SBS GROUP

Integrated report2022

CONTENTS

02

About This Report

33

03

Our Management Philosophy andits Implementation

Environment

05

Commitment from Top
Management

35

Major Indicators (Fiscal 2021 Results)

09

36

Review of Fiscal 2021 Initiatives

SBS Group Business Overview

15

37

Mid-to-Long-Term Environmental Plan

The SBS Group’s Value Creation
Process

38

Action Plan

17

Business Overview and Financial
Status39

Climate Change Risks and Countermeasures

40

The SBS Group's CO2 Reduction Measures

CSR Message & Key Topics

21

External Environment andMid-to-Long-Term Management
Strategy

23

41

Key Indicators [Safety] (Fiscal 2021 Results)

Rolling out 3PL

25

42

Review of Fiscal 2021 Initiatives [Safety]

SDGs at the SBS Group

27

43

Education and Awareness-Raising, Accident Prevention

Controlling Management Risks

31

44

Safe Driving Management

Responding to the Effects of the
COVID-19 Pandemic

45

Engagement Between the SBS Group and Society, Engagement with Customers
Engagement with Employees, Engagement with Business Partners,
Communication with Stakeholders

47

Social Contribution Activities

Safety & Social

Governance

49

Major Indicators (Fiscal 2021 Results)

50

Corporate Governance System

51

List of Directors, Executive Officers

53

Ensuring Effectiveness56

Maintaining Constructive Ties with Shareholders

58

Compliance

59

Risk management

60

Information Security

Data Section

61

Financial and Business Information

63

CSR Data

652021 Highlights, Corporate Profile and Stock Information

Editorial Policy
The SBS Group, as a mega-venture that is “transforming the world of logistics,” publishes an Integrated Report toinform stakeholders interested in the Group's short, medium and long-term value creation to report on its
business activities as well as on its CSR management plan and its progress, its accomplishments, and futurechallenges. To ensure the accuracy and reliability of information, the report is designed to be simple and clear sothat it can be easily read even without prior knowledge of the SBS Group.
On the SBS Group website, we disclose comprehensive IR information and general company information in
addition to CSR information not listed in this report. https://www.sbs-group.co.jp

01 SBS GROUP Integrated report 2022

About This Report

Reporting Process

Reporting Scope

This report is structured around the key challenges thathave a significant impact on the SBS Group's ability tocreate value in the short-, mid- and long-term. The
identification and weighting of key challenges isconducted carefully as the starting point in the annual
reporting cycle, and serves as the basis for the
information reported. After being combined organicallywith related information, the prepared report undergoes
review by management and is then provided to
stakeholders in printed and electronic form.

■ 25 Domestic Subsidiaries
SBS Toshiba Logistics Corporation / TL Logi Service Co., Ltd. /SBS Ricoh Logistics System Co., Ltd. / SBS San-Ai Logistics Co.,
Ltd./ Jas Co., Ltd. / SBS Logicom Co., Ltd. / SBS Logicom Kanto
Co., Ltd./ SBS Freight Service Co., Ltd. / SBS Global Network Co.,
Ltd. / K.U.K. LINE Co., Ltd. / SBS Flec Co., Ltd. / SBS Flecnet Co.,
Ltd. /Hinomaru Kyuso Co., Ltd. / SBS Zentsu Co., Ltd. /SBS
Sokuhai Support Co., Ltd./ Ai&Ai Co., Ltd./ SBS Staff Co., Ltd.
/Jobright Co., Ltd. / SBS Finance Co., Ltd. / SBS AssetManagement Co., Ltd. / L-MAX Co., Ltd. / Marketing Partner, Inc.
/Global Pet Nutrition, Inc./ SBS Driving School Co., Ltd. / Toyo
Warehouse and Transportation Co., Ltd.

Identificationand Weightingof
Key Challenges

Dialogue with
Internal andExternal
Stakeholders■ Public Interest Incorporated Foundation
SBS Kamata Foundation

Collection andIntegration ofRelatedInformation

Reporting Period
Fiscal 2021 (January to December 2021)

Review by
Management

9 Energy and climate change
Addressing the energy demand-supply
gap and climate change risks from along-term perspective

5 Technology
Key Challenges

1 Changes to the structure of thelogistics market
We analyze rapid changes to the structure of the logistics market, so that a
strategic response can be facilitated

2 M&A and group synergy
M&A activities as the core of our growthstrategy, and the processes to maximize
those effects

3 3PL
Strengthening the expanding services tocomprehensively handle and optimize
corporate logistics operations

Strategically utilizing LT* and IT to link
value creation with improved competitiveness6 Quality and safety
Ensuring the quality and safety of transportation and service that form the basisof our business activities

7 Human resources
Securing and developing a diverse rangeof human resources supporting the
growth of the SBS Group and Japaneselogistics

10 Crisis management
Preparedness for natural disasters andother crises for management

11 Relationship with society
Coexistence rooted in dialogue with a diverse range of stakeholders

12 Governance
Ensuring corporate governance systems
that represent the basis of value creation

8 Working styles and productivity
Taking on the challenge of new working
styles and pursuing ongoing improvements to business productivity* Logistics Technology

4 Logistics facility development
Systematic expansion of floor space as acore of increasing logistics infrastructure
and the foundation of 3PL

SBS GROUP Integrated report 202202

Our Management Philosophy and its Implementation

Management Philosophy

We provide services to achieve client satisfaction, to meet shareholders'
expectations, and to be a company caring of its employees.
Long-term prosperity is rooted in paying the necessary attention to people
and in the enthusiasm of our employees.
Social responsibility is essential to corporate growth.
Harmony within the community, efforts to make those around us happy, andcontribution to society far and wide, is crucial.

The Group Slogan, "For Your Dreams," expresses
sentiments the SBS Group has continually pursued since
its founding - the importance of chasing dreams, andhow doing so shapes the future.
We conduct business to realize the dreams of all
stakeholders and strive to enhance corporate value.

03 SBS GROUP Integrated report 2022

Highlights of our Management Philosophy Implementation (Fiscal 2021)

Customers

Employees

Society and theEnvironment

138,110,305 km
Consolidated Net Sales 403.4 billion yen

Total Distance Driven

23 Subjects
Actual Training Participants 8,966
Training Conducted All

Number of Business Sites with G-Mark Certification (Certification Rate)
Logistics Research Grants

169 business sites (89.4%)

4

Scholarships for Students Receiving Social Care
Investment in the Environment

76

3,580 million yen

Environmental Efficiency (CO2 emissions per unit of sales)28.23 t(46% improvement over the past five years)

12,666 kW
Waste Processing Logistics Handling Volume 8,360 t

Renewable Energy Generating Capacity

Sustainable
Development

Shareholders

19.4%
ROA 7.7%
ROE

Dividend per Share

55 yenSBS GROUP Integrated report 202204Commitment from Top Management

Aiming to achieve net sales of
one trillion yen as a mega
venture channeling an
unrelenting passion to transformthe world of logistics.
Ushering in a transformation in the world oflogistics as a mega venture
The SBS Group has been relentlessly taking on new challenges
since its founding in 1987 when it started with what was thenconsidered an innovative service: same-day delivery in the Tokyo
metropolitan area. Even as a series of companies handling thelogistics functions of national brands have joined the SBS Group, ourindomitable venture spirit has continued to thrive as the DNA of theGroup. As a result, since its founding the Group has achieved anumber of milestones largely as planned, reaching 10 billion yen in
net sales by its 10th anniversary, 100 billion yen by its 20th, and 200
billion yen by its 30th year in operation. The Group now has its sights
set on the next stage: net sales of one trillion yen.
Looking ahead, with a wide range of logistics functions spread
globally, the ability to propose innovative solutions and as a "megaventure" with an unrivaled sense of speed, we will shape the futureof logistics.

Posting record business performance in four
consecutive periods
In the fiscal year ended December 2021, the COVID-19 pandemic
continued to impose enormous restrictions on economic activity inJapan and abroad. However, logistics demand related to electroniccommerce (EC) for daily necessities and online shipping expanded

Net sales(100 million yen)

Fiscal 2021 Results

5,000

2020: Toshiba Logistics (currently: SBS Toshiba Logistics) Logistics

Net Sales
2018: Ricoh Logistics (currently: SBS Ricoh Logistics System)

4,000

2006: Zentsu (currently: SBS Zentsu)
and one other company

3,000

2005: Tokyu Logistic (currently: SBS Logicom)
and eight other companies

2,000

2004: Yukijirushi Butsuryu (currently: SBS Flec)and nine other companies

1987

1995

2000

05 SBS GROUP Integrated report 2022

1,000

2005

2010

2015

2022

0

403.4
20.7

billion Yen (+56.9%)

Operating Income

billion yen (+88.9%)

Fiscal 2022 Plan
Sales

430.0
21.5

Operating Income

billion yen

billion yen

further. The SBS Group has taken the initiative to respond to
growing demand while placing top priority on preventing infections
and ensuring safety among customers, business partners andemployees.
In our logistics operations we saw strong performance, withexpanded business with existing customers, capturing demand fromnew customers, the recovery of intercompany logistics that were hit
hard by the spread of COVID-19, the capturing of e-commerce
demand in the same-day delivery business, and catering to demandfor daily necessities and online supermarket usage. Additionally inthe real estate business where the SBS Group implements a uniquebusiness model of in-house logistics facility development andsecuritization, we transferred trust beneficiary rights for the Nanko
Logistics Center (Osaka Prefecture).
As a result of these efforts, the Group posted consolidated net
sales of 403.485 billion yen (up 56.9% year on year) andconsolidated operating income of 20.706 billion yen (up 88.9% year
on year) for the year under review, setting new records in both
metrics for the fourth consecutive year.
For the fiscal year ending December 31 2022, we plan to achieve
moderate year-on-year increases in sales and income, withconsolidated net sales of 430 billion yen and consolidated operating
income of 21.5 billion yen. This will shore up the Group's businessstructure after its rapid expansion in the previous year, and maximize
growth in the next fiscal year and beyond.

Growth Strategies Aimed at Reaching the Top
Tier of the Logistics Industry
The SBS Group's growth strategies aimed at reaching the top tierof the logistics industry comprise a strategy to achieve
non-consecutive growth and a strategy to accelerate autonomous(organic) growth.
The engines of non-consecutive growth are M&A activities to add
new members to the Group and the post-merger integration (PMI)
activities for mutual collaboration thereafter. The SBS Group's
approach is to view the process up to this point as a series of steps.
On the other hand, the keys to autonomous growth lie in the●

Furukawa Logistics

K.U.K. LINE●

Hinomaru Kyuso

●

●

●

●

●

●

●

Toyo Warehouse &Transportation

●

●

M&A

Jas, and othercompanies

AI logistics prediction
systems
Trunk line network visualization
systemBulk inspection systems, etc.

Through M&A actions targeting carefully selected companies, theGroup will extend the size and breadth as a corporate group andtake measured steps to produce synergy. Instead of relying on
simple restructuring, we focus our wisdom on helping new member
companies become better logistics providers, thus enhancing theearning and growth potential of the Group as a whole.
In the fiscal year ended December 2021, a number of companies
joined the SBS Group, including Furukawa Logistics, Toyo
Warehouse & Transportation, K.U.K. LINE, Hinomaru Kyuso andJas. While leveraging their individual strengths, we are strengthening
the structure to more effectively support the logistics supply chainsof diverse customers Group-wide. We have also been investing in
the maintenance and development of regional delivery networks
through the Japan Future Logistics Fund, a joint partnership
between the Development Bank of Japan and SBS Holdings.
Meanwhile, we also pursued PMI activities with SBS Ricoh
Logistics and SBS Toshiba Logistics, which had joined the SBSGroup by the fiscal year ended December 2020. SBS Ricoh
Logistics, which joined the Group shortly ahead of SBS Toshiba
Logistics, has been winning new projects through intra-Group
coordination. Its sales have grown 23% since the fiscal year ended
December 2018, and 49%, almost half of its business, falls outside
its previous parent company. The first steps of PMI with SBS
Toshiba Logistics involved the migration of information systems,
mutual sharing of knowledge regarding LT and IT, and theintegration of overseas sites. The relocation to a new head office inNishi-Shinjuku and the consolidation of head office functions in
Spring 2022 was aimed at encouraging this process.

SBS Toshiba Logistics

Target Company Name Target Company NameSBS Ricoh Logistics
SystemFurukawa Logistics

Expertise in transportation of telecommunications equipment and motor vehicles, etc.
Expanded business with the Furukawa ElectricGroup

Toyo Warehouse &Transportation

Customs clearance, international logistics
Location potential in Tokyo waterfront area

K.U.K. LINE

Small lot joint deliveries, furniture deliveries,
logistics supply chain in western Japan

Hinomaru Kyuso

Food logistics at the three temperature zones
Delivery network throughout Shikoku

Jas

Trunk line network between the Tohoku andKanto districts serving small lot deliveries in
the Tohoku district and deliveries for massmerchandisers

PMI

Sustainable
Group
Management

LT×IT
AutoStore
Logistics
Shelf-carrying robots Facilities

Non-consecutive growth through M&A
and PMI activities.

M&A activities in Fiscal 2021

SBS Group Growth Strategy●

utilization of logistics technology (LT) and IT, and in the developmentof logistics facilities and new businesses.
While maintaining the unique business model that has growth with
3PL at its core as a common foundation, we will combine these two
approaches to growth and facilitate their interaction to achievesustainable growth.

Business
Development
and Marketing●●

Development of the
e-commerce logistics
business
Expansion of home delivery
business service areas

SBS GROUP Integrated report 202206

Commitment from Top Management

Developing Logistics Facilities Through LT × IT

Business Development and MarketingTechnology and logistics facilities are the key infrastructure
enabling the SBS Group to operate as a 3PL corporate grouppossessing omnidirectional logistics functions, and need to beenhanced in both qualitative and quantitative terms.
Rapidly evolving logistics technologies give rise to new
approaches that transform the world of logistics. The SBS Groupestablished an information system division that spans the Group in
April 2020, and has been developing advanced vehicle and logistics
management while implementing projects to introduce LT and IT in
the field. From robots used to carry shelf units or sort items tohigh-precision inspection systems using image processing
technologies and systems that visualize the status of trunk linedelivery networks, we are piloting methods with the potential tosignificantly enhance the productivity of logistics facilities.
The Yokohama Kanazawa Logistics Center which enteredoperation in October 2021 is a prime example of theseadvancements being deployed in the field. The center is the first
facility developed by the SBS Group as a large-scale 3PL centerusing state-of-the-art LT and IT. Inside a building with a total floorarea of around 52,000 square meters, we have installed Japan's firstand one of Asia's largest implementations of the AutoStore system
in which robots place and retrieve containers. Robots and othercutting-edge logistics technologies will also be utilized at alarge-scale facility where construction will begin in 2022.
We have developed of logistics facilities in each region, with oneof our targets being a total operational area of one million tsubo(approx. 3.3 million square meters). As of December 31, 2021, we
had reached an operational area of 765,000 tsubo (around 2.52
million square meters), and have reached 966,000 tsubo (3.19
million square meters) when forecasts in our floor expansion plans
are included, indicating we are close to achieving this milestone.
We are working to enhance the added value of our logistics
facilities in various ways, such as installing solar panels andwall-mounted signage. By December 2021, we had installed solar
panels at 14 facilities, with a combined generating capacity of
approximately 11 MW.

We will particularly focus on e-commerce (EC) as a future area of
business growth. While the products handled and participating
players become increasingly diverse with each day, EC is expected
to enjoy considerable growth in the future. To seize this opportunity,
a Groupwide project to start new EC logistics services waslaunched. The team, which is mainly made up of junior employees, isworking at a rapid pace to begin service within the year. As the basis
for the project, we will build a service platform dedicated to EC
logistics and develop dedicated EC logistics facilities equipped with
cutting-edge technologies. We will also provide total support for EC
operators, from center operation to final delivery. Our plan is todevelop EC logistics into a 100 billion-yen business by the fiscal year
ending December 2030 in a way that differentiates it from existing
EC-related businesses.
We are also working to expand our home delivery service area,
which was previously focused in the Tokyo metropolitan area, tospan all of Japan. This will be tackled through a multi-layered
approach that includes coordination between SBS Sokuhai Support,
whose main service areas is the Tokyo metropolitan area, and SBS
Ricoh Logistics, which maintains a delivery network reaching every
corner of the country, as well as tie-ups with external partners.

CSR Management and Raising the Levelof ESGFor the SBS Group, CSR (corporate social responsibility)
management, which is based on responding to the demands ofsociety, is an initiative that should be consistent and strategic.
Climate change, which continues to emerge as a global risk, is anurgent issue for logistics companies. In Sincere Challenge 2030, themedium-to-long-term environmental plan, reducing CO2 emissions
from our vehicles and facilities is a major theme. As a part of thiseffort, over the next five years or so we plan to replace theapproximately 2,000 vehicles that are operating as e-commercevehicles in last mile logistics with electric vehicles (EV). We are also

The AutoStore units (two units) installed at the
Yokohama Kanazawa Logistics Center can perform theSize of Logistics Facilities

storage and picking of around 80,000 items in total.

(as of December 31, 2021)

Operations can be carried out by up to 24 people,

Operational
Area:

765,200

boosting productivity twofold for warehousing
operations and threefold for shipping operations

tsubo(approx. 2.5 million square meters)

PlannedFloor Area
Expansion:

201,600

tsubo(approx. 666,000 square meters)

07 SBS GROUP Integrated report 2022

compared with before.

encouraging our affiliates to adopt EVs and expect EV replacements
to number around 10,000 in the medium term. In addition, we haveconducted risk assessments, studied countermeasures anddisclosed our findings based on the framework of the Taskforce on
Climate-related Financial Disclosures (TCFD).
The SBS Group owns 4,884 vehicles (excluding those used at its
driving schools, etc.), and takes a multifaceted approach to safetymeasures that extends to the health of vehicle crew based onsafety-first principles. Additionally, to optimize and enhance safety
management systems at each business site, we have been working
to obtain "G Mark" certification, which is evaluated and authorized
by the Japan Trucking Association. In the fiscal year ended
December 2021, three business sites newly obtained thecertification. 169 business sites now maintain this certification, whichcorresponds to a certification rate of 89.4%.
Other ongoing initiatives including the cultivation of humanresources in Japan and overseas, efforts to maintain optimal
workplace environments, grants for outstanding research into
logistics, scholarships for students receiving social care, and support
for food banks.
Toward the future vision laid out by the SBS Group through the
Sustainable Development Goals (SDGs), we will continue to envision
the future of the logistics business and organizations that support it,
and achieve our vision one step at a time. We are confident that thiswill raise the level of the SBS Group's ESG efforts in a natural way.

Shareholder Return
The SBS Group considers the return of profits to shareholders
while achieving value creation for a wide range of stakeholders to be
one of its most important management priorities. We seek tobalance shareholder return with the retention of sufficient internal
reserves to build a more robust management base, while
endeavoring to maintain continuous dividends and improving thelevel of dividends in light of business performance.
In the fiscal year ended December 2020, we raised the dividend
per share by 20 yen from the previous period to 55 yen, in light of
the important progress the SBS Group had made. In the fiscal year

ending December 2022, we plan to raise dividends another 4 yen to
59 yen per share.
Also note that all of the indicators (total asset turnover, return on
equity and net D/E ratio) that the SBS Group monitors closely tomaintain its financial soundness have further improved over theprevious year, and we believe shareholder return is at a sustainablelevel.

Expanding the Infrastructure of Hope Together
with Growth
In an increasingly unstable world, logistics is playing an
increasingly important role in supporting daily life in society bybridging the gaps between various locations and entities in eachcountry. We will continue to search for better ways to provide
logistics while pursuing growth that represents the "infrastructure ofhope" delivering on the dreams of people around the world basedon our slogan, "For Your Dreams."
In March 2022, operations commenced at our new head office inNishi-Shinjuku (Shinjuku-ku, Tokyo), which consolidates the head
office functions of SBS Group companies. The new head office will
facilitate deeper intra-Group coordination and accelerate integration,
ushering in the next stage of the Group.
At the Board of Directors meeting held on December 10, 2021,
SBS Holdings decided to select and apply for Prime Market listingunder the new market segments of the Tokyo Stock Exchange. We
will continue to engage in constructive dialogue with investors from a
global perspective and create value in the medium and long term.
To the readers of this report, I would like to again thank you foryour interest in where the SBS Group is today, and the path we aretaking into the future.

Number of Business Sites with
G-Mark Certification andCertification Rate

President, SBS Group

Masahiko Kamata

Indicators of Financial Soundness(Assessment as business sites withexcellent safety in fiscal 2021)

169
89.4

business sites

Since December 31, 2021, the SBSGroup has been conducting
demonstration testing on public roads ofa compact EV truck (1-ton class, thefirst introduced in Japan) provided by
the Kyoto-based venture company
Folofly.

%

Dividend Paid (fiscal 2021)

55

Total Asset Turnover:

Return on Equity:

Net D/E Ratio:

1.52
19.4
1.19

x (+0.34x)% (+5.2%)(improvement
x of 0.15 points)yen (+ 20 yen)
SBS GROUP Integrated report 2022

08

SBS Group Business Overview

Transporting all manner of things safely,
securely and in an optimal environment
The SBS Group has organically developed its
General Logistics, Property Management andLogistics Support businesses. In the General

General Logistics Business
Truck Transportation
Rail Transportation

Logistics Business, we perform the transpor-

Low Temperature Logistics

tation and delivery of raw materials and prod-

Logistics Center Operationucts, as well as the associated storage, load-

International Logistics

ing, unloading, packaging, distribution pro-

Processing in Logistics

cessing and information management. This isSame-Day Delivery for Corporations

a third-party logistics (3PL) related business
in which we propose logistics reforms to corporate clients and are entrusted with their lo-

Home Delivery (for Individuals)
Company Relocation / Individual Relocation
On-site Logistics
3PL Consulting

gistics operations on a comprehensive basis.
The 3PL-related business makes full use of
the logistics facilities the Group has planned

Logistics Support Businessand developed through the Property Manage-

Marketing Businessment Business. By securitizing facilities as

Pet Wellness Businesshigh-utilization properties at the time they are

Insurance and Leasing

sold, we obtain a gain on sale and recoup ourEnvironmental Business

investment. The Logistics Support Business

Personnel Support

provides the supplementary functions thatthese businesses require.

Property Management Business
Rent Business
Development Business

SBS Holdings, Inc.
Holding company for the SBS Group
Number of Employees: 325
Number of Business Sites: 1
Renewable Energy Generating Capacity: 2,826 kW
Main Business: Group-wide strategies(Group strategy functions, corporate governance functions)Management, otherhttps://www.sbs-group.co.jp/

09 SBS GROUP Integrated report 2022

Number of Business Sites

Number of Vehicles Owned

Number of Employees

674

4,884
1,488

23,950* Excluding driving schools(Trucks andother roadvehicles)* All figures are the total number of employees anddiffer from the figures listed in securities reports.

(Forklifts)

SBS GROUP Integrated report 2022

10

SBS Group Business Overview

SBS Toshiba Logistics Co., Ltd.
* Various figures include TL Logi Service Co., Ltd.

A Fourth Party Logistics (4PL) company going beyond the boundaries of the Toshiba Group that
proposes and realizes logistics strategies in line with management strategies for a wide range ofcustomers. Working in partnership with SBS Group companies, SBS Toshiba Logistics provides
integrated services from logistics engineering (planning and design) to the operation of logistics
functions at the implementation stages, both in Japan and overseas. By providing total logistics
solutions that are not only of a high quality but competitive, the company provides powerfulsupport for solving customers' management issues.
Number of Employees: 2,581 / Number of Business Sites: 87/ Number of Vehicles: Trucks and other roadvehicles: -, Forklifts: Certifications: ISO14001, ISO9001, ISO/IEC17025, ISO/IEC27001, AEO
Consolidated Subsidiaries: TL Logi Service Co., Ltd., Toshiba Logistics (Shanghai) Co., Ltd., Toshiba Logistics(Hangzhou) Co., Ltd., Toshiba Logistics (Dalian) Co., Ltd., Toshiba Logistics Hong Kong Co., Ltd., Toshiba
Logistics (Singapore) Pte. Ltd., Toshiba Logistics (Philippines) Corporation, TL Forwarding Service (Philippines)
Corporation, Toshiba Logistics (Thailand) Co., Ltd., TL Service (Thailand) Co., Ltd., Toshiba Logistics Malaysia
Sdn. Bhd., Toshiba Logistics Vietnam Co., Ltd., Toshiba Logistics India Private Limited, Toshiba Logistics
America, Inc., Toshiba Logistics Europe GmbHSBS Ricoh Logistics System Co., Ltd.
* Various figures include SBS San-Ai Logistics Co., Ltd. and Jas Co., Ltd.

Managing the supply chains of precision equipment manufacturers played a key part in theestablishment of SBS Ricoh Logistics System. With the impressive quality and "KAIZEN"
capabilities for which national brands are renowned in our DNA, we support the success of ourcustomers through domestic and overseas 3PL. With our outstanding logistics technologies wecontinue to propose the best methods for a wide range of customers' logistics needs based on a
backbone of "recycling-oriented logistics" that integrates procurement, production, sales andvenous logistics.
Number of Employees: 4,189 / Number of Business Sites: 125 / Number of Vehicles: Trucks and other roadvehicles: 529, Forklifts: 497
Certifications: SO14001, ISO9001, ISO27001, AEO
Consolidated subsidiaries: SBS San-ai Logistics Co., Ltd., RICOH LOGISTICS CORPORATION [USA], RICOH
INTERNATIONAL LOGISTICS (H.K) Ltd. [Hong Kong], RICOH INTERNATIONAL FREIGHT FORWARDING(SHENZHEN) CO., LTD. [China], SBS Logistics (Thailand) Co., Ltd. [Thailand], SBS Vietnam Co., Ltd. [Vietnam],Jas Co., Ltd.

SBS Logicom Co., Ltd.
* Various figures include SBS Logicom Kanto Co., Ltd. and K.U.K. LINE Co., Ltd.

As a partner company to its customers, SBS Logicom provides total logistics services covering
everything from logistics consulting and strategy to planning and operations. With various waves ofchange sweeping through the logistics industry, SBS Logicom continues to make strides forward
as a logistics company meeting the needs of a wide range of customers across various industries
and supporting social infrastructure through a focus on warehouse management, cargo handlingand distribution processing services, along with logistics centers, truck and rail transportation,
special transportation, customs clearance and international transportation, government, corporate
and school relocations, and on-site logistics.
Number of Employees: 6,881 / Number of Business Sites: 134 / Number of Vehicles: Trucks and other roadvehicles: 1,146, Forklifts: 482
Renewable Energy Generating Capacity: 6,812 kW
Certifications: G-Mark, ISO14001, ISO27001, Green Management Certification, GPN Certification, Relocation
Safety Mark
Consolidated subsidiaries: SBS Freight Service Co., Ltd., SBS Logicom Kanto Co., Ltd., SBS Global Network
Co., Ltd., K.U.K. LINE Co., Ltd.

M&A

3PL/4PL

Truck
Transportation

11 SBS GROUP Integrated report 2022

International
Logistics

Modal Shift

Logistics andDelivery for
E-commerce

Logistics
Center Operation

Processing in
Logistics

Support for
LT Planning andIntroduction

Company
Relocation

Packaging
Design andDevelopment

SBS GROUPSBS Flec Co., Ltd.
* Various figures include SBS Flecnet Co., Ltd. and Hinomaru Kyuso Co., Ltd.

SBS Flec was founded in 1956 as Yukijirushi Logistics Co., Ltd. It handled food logistics as thelogistics subsidiary of the Yukijirushi Group, and has honed its expertise in food distribution
technologies and quality control through its nationwide network. Today, SBS Flec provides
comprehensive support for food manufacturers from production to the placement of products instores as one of the few 3PL companies able to handle all three temperature zones, namely dry(room temperature), chilled (refrigerated) and frozen. As a leading company in low temperaturelogistics, SBS Flec is committed to delivering foods with safety and peace of mind.
Number of Employees: 4,208 / Number of Business Sites: 98 / Number of Vehicles: Trucks and other roadvehicles: 868, Forklifts: 262
Certifications: G-Mark, ISO14001, ISO9001
Consolidated subsidiaries: SBS Flecnet Co., Ltd., Hinomaru Kyuso Co., Ltd.

SBS Sokuhai Support Co., Ltd.
* Various figures include Ai & Ai Co., Ltd.

In December 1987, the SBS Group started SBS Sokuhai Support as a same-day delivery
business. Revolutionary for its time, this business model is still utilized by many users. Morerecently, SBS Sokuhai Support has been using the expertise it has developed in the same-day
delivery business for the e-commerce home delivery business, which is experiencing rapid growthin demand, and is in the process of expanding its operations to major Japanese cities. The
company also combines venous logistics functions to play a part in recycling-oriented logistics.
Number of Employees: 612 / Number of Business Sites: 31 / Number of Vehicles: Trucks and other roadvehicles: 298, Forklifts: 46
Certifications: G-Mark, ISO14001, ISO27001
Consolidated Subsidiaries: Ai & Ai Co., Ltd.

SBS Zentsu Co., Ltd.
SBS Zentsu provides total support for the food supply chain by building logistics systems that
consolidate pre-cooled and temperature-controlled transportation, joint delivery and food in four
temperature zones. In response to increasingly sophisticated and complex logistics needs, SBS
Zentsu uses the "creativity" it has cultivated providing operations and services for many years as a
powerful tool, overcoming difficulties and issues one after another while continually creating new
solutions.
Number of Employees: 4,095 / Number of Business Sites: 110 / Number of Vehicles: Trucks and other roadvehicles: 1,626, Forklifts: Renewable Energy Generating Capacity: 6,812 kW
Certifications: G-Mark, ISO14001, ISO9001, JAS Organic Agricultural Product Subdivider Certification

SBS Furukawa Logistics* Various figures include Yokohama Drum Manufacturing Co., Ltd.

Catering to all manner of needs utilizing expertise cultivated as a manufacturer-linked logistics
company including electrical cables, nonferrous metals and synthetic resins. The company
operates global logistics services with a focus on Asia. By providing logistics solutions optimized
to the customer, the company achieves efficient logistics.
Number of Employees: 186 / Number of Business Sites: 28 / Number of Vehicles: Trucks and other roadvehicles: -, Forklifts: Certifications: ISO14001, ISO9001
Consolidated Subsidiaries: Yokohama Drum Manufacturing Co., Ltd., Hong Kong Dehe Logistics Ltd.,
Furukawa Logistics (Shanghai) Co., Ltd.

Environmental
Business

Low
Temperature
Logistics

Logistics
Facility
Development

On-siteLogistics

Property
Management
Business

Same-Day
Delivery for
Corporate
Customers

Personnel
SupportMarketingBusiness

Pet Wellness
Business

Insurance andLeasing

Safe Driving
Training

SBS GROUP Integrated report 2022

12

SBS Group Business Overview

SBS Freight Service Co., Ltd.
Transportation and delivery network covering the Pacific side of eastern Japan to Kansai. SBS
Freight Service offers an extensive range of transportation services from three-temperature-zonetransportation, special transportation such as shipping for filming locations, marine container
drayage transportation, warehousing, storage and distribution processing, and office relocation
services. The company is also focusing on distribution center operation in response to expanding
e-commerce needs.
Number of Employees: 372 / Number of Business Sites: 22 / Number of Vehicles: Trucks and other roadvehicles: 373, Forklifts: 61
Renewable Energy Generating Capacity: 212 kW
Certifications: G-Mark, ISO14001, ISO9001, Privacy MarkSBS Global Network Co., Ltd.
Based on its extensive overseas distribution network that extends from Japan to Asia and theworld, SBS Global Network supports supply chains in Japan and abroad. The company conducts
analyses of the current status of international logistics being implemented by customers(consulting). It then proposes and implements optimum import and export operations based on
cargo characteristics and supply chain strategies.
Number of Employees: 154 / Number of Business Sites: 8 / Number of Vehicles: 5
Certifications: AEO certification (planned)

Toyo Warehouse & Transportation Co., Ltd.
Based on large warehouses in Wakasu, Higashi-Ogishima, the company helps strengthen
logistics infrastructure in Tokyo waterfront area. The company primarily engages in 3PL andcustoms clearance services, dealing with a wide range of products. By aiming to build a logistics
management system that can cater to every business type, the company proposes optimum
warehouse environments and logistics businesses.
Number of Employees: 153 / Number of Business Sites: 6 / Number of Vehicles: Trucks and other roadvehicles: 6, Forklifts: 39

SBS Asset Management Co., Ltd.
* Various figures include L-MAX Co., Ltd.

SBS Asset Management is an asset management company responsible for developing thelogistics facilities of the SBS Group. Using expert knowledge and know-how regarding finance,
real estate and logistics, the company independently develops specialized logistics facilities
optimized for 3PL. With a strength in highly functional design informed by an intimate knowledgeof logistics in the field, SBS Asset Management handles increasingly sophisticated logistics while
responding to changes in the value chain based on in-depth research. SBS Asset Management
operates a total asset management business specializing in everything from land acquisition andleasing to asset securitization.
Number of Employees: 11 / Number of Business Sites: 1
Renewable Energy Generating Capacity: 1,500 kW
Consolidated Subsidiaries: L-MAX Co., Ltd.

M&A

3PL/4PL

Truck
Transportation

13 SBS GROUP Integrated report 2022

International
Logistics

Modal Shift

Logistics andDelivery for
E-commerce

Logistics
Center Operation

Processing in
Logistics

Support for
LT Planning andIntroduction

Company
Relocation

Packaging
Design andDevelopment

SBS GROUPSBS Staff Co., Ltd.
* Various figures include Jobright Co., Ltd.

SBS Staff operates a worker dispatch business which specializes in the logistics business and is
tailored to customer needs. With its unique matching system, the company is able to respond tosudden job openings. Fee-based job placement services are also available.
Number of Employees: 140 / Number of Business Sites: 18 / Number of Vehicles: 20
Renewable Energy Generating Capacity: 1,500 kW
Certifications: Privacy Mark
Consolidated Subsidiaries: Jobright Co., Ltd.

SBS Finance Co., Ltd.
SBS Finance provides a wide range of services from leasing and sales to insurance. As a financecompany excelling in the area of logistics, SBS Finance provides a range of functions including
the joint purchasing of consumables for logistics businesses.
Number of Employees: 22 / Number of Business Sites: 1

Marketing Partner, Inc.
* Various figures include Global Pet Nutrition Inc.

Providing one-stop service for e-commerce site development and operation. The company
provides e-commerce business support covering the four areas of marketing, analysis, creativeand fulfillment.
Number of Employees: 57 / Number of Business Sites: 1
Certifications: Privacy Mark
Consolidated Subsidiaries: Global Pet Nutrition Inc.

SBS Driving School Co., Ltd.
We operate driving schools with the aim of developing safe drivers in the SBS Group and local
community. Students can obtain licenses for regular cars, mid-sized vehicles and motorcycles.
Number of Employees: 43 / Number of Business Sites: 3 / Number of Vehicles: 72 (training vehicles (cars andmotorcycles, shuttle cars, etc.)
Renewable Energy Generating Capacity: 6,812 kW
Certifications: G-Mark, ISO14001, ISO9001, JAS Organic Agricultural Product Subdivider Certification

Japan Logistics Future Limited Partnership for Investment (Japan Logistics Future Investment Fund Co., Ltd.)

Overseas Group Companies
SBS Logistics Holdings Hong Kong Ltd. [Hong Kong]
Shanghai Qingqiliu Plastic Processing Co., Ltd. [Shanghai]
SBS Total Logistics Malaysia Sdn. Bhd. [Malaysia]
SBS Logistics Philippines, Inc. [Philippines]
TAS Logistics Co., Ltd. (Thailand) [Thailand]Overseas Affiliate Companies
Atlas Logistics Pvt Ltd. (India) [India]

Environmental
Business

Low
Temperature
Logistics

Logistics
Facility
Development

On-siteLogistics

Property
Management
Business

Same-Day
Delivery for
Corporate
Customers

Personnel
SupportMarketingBusiness

Pet Wellness
Business

Insurance andLeasing

Safe Driving
Training

SBS GROUP Integrated report 2022

14

The SBS Group’s Value Creation Process

The SBS Group sees capital that will support its business activities as a "3PL corporate group possessing
omnidirectional logistics functions" from a broad perspective and seeks to effectively utilize and enhance that capital.

INPUTS
Capital utilized for corporate activities

CapitalFinancial
CapitalCapital for
the Provisionof Services

Human and
Organizational
CapitalIntellectual
CapitalManagement Approach

We seek to maintain an equilibrium between active investment activities andensuring financial health. Accordingly, atarget shareholders' equity ratio of 30%
has been set. In terms of shareholder
return, the Company maintains continuous dividends and makes every effort
to raise dividend levels in line with business performance.

We are committed to developing comprehensive logistics infrastructure including logistics facilities, vehicles,
equipment, information systems andservice sites, at a scale and quality
level that adequately satisfies our needto grow.

To secure and develop talented humanresources, the SBS Group makes improvements to its personnel systems,
provides training and education to all
employees, and develops a workplacethat offers job fulfillment. The SBSGroup also enhances the operational
quality of the organization by developing and operating management systems.
We will further enhance our wide-ranging logistics service operational capabilities while systematically accumulating, sharing and developing knowledge
leading to solutions to customer
issues.

ChangeIndicators

2017

2020

2021

Total assets (million yen)

127,802 171,796 180,047 254,550

277,197

Net assets (million yen)

38,51048,17354,077

68,14680,707

Shareholders' equity ratio (%)

28.5

23.1

25.1

19.9

21.9

Net DE ratio (times)

1.26

1.44

1.21

1.39

1.19

Number of shareholders

3,702

2,921

2,878

3,911

4,501

Number of business sites

425

531

655

716

674

-

-

386

401

412

Number of Vehicles

4,103

4,497

4,570

4,405

4,884

Number of forklifts

814

1,382

1,436

1,369

1,488

Investment in facilities and equipment(million yen)

9,576

11,607

11,71011,507

14,501

Number of Employees*

14,91319,017

19,37923,27023,950

Actual training participants

2,585

Number of warehouses(number of company-owned and leased buildings)

SocialCapital

2019

5,095

7,173

6,824

8,966

Number of companies with ISO 9001
(quality) certification

5

5

6

7

Number of companies with ISO14001(environmental) certification

7

7

8

9

Number of companies with ISO 27001(information security) certification

4

4

5

5

Group-average fuel efficiency (km/L)

4.94

4.93

4.93

5.01

5.03

Number of employees taking eco-driving training(cumulative total)

1,449

1,500

1,570

1,570

1,617

3

2

2

4

7

129

153

162

167

169

Awards and Commendations
Number of business sites with G-mark certification

The SBS Group gains an understanding of varied expectations and demands through dialogue with stakeholders, reflects that insight in its corporate activities, and strives to work inharmony with society. We make particular efforts with respect to ensuringsafety, the most important social
demand for a logistics business operator.
We also contribute to society and local
communities as a corporate citizen.

2018

3,239

3,554

3,692

3,692

Equipped in all
vehicles except for
shuttle vehicle andsales vehicles

2,452

2,937

3,752

3,752

Equipped in all
vehicles

3,194

3,589

2,407

2,407

Equipped in
80% of cargovehiclesLogistics Research Grants

7

9

6

6

4

Scholarships for students receiving social care

30

34

57

74

76

12

18

Digital / analog tachographs
Number ofvehiclesequipped with Dashcams
driving support
equipment
Rear-View Cameras

Number of times Food Bank support provided(cumulative)

NaturalCapitalThe SBS Group pursues efforts to continually reduce its environmental impact
from a medium-to-long-term perspective, positioning CO2 emission reductions, the promotion of resource recycling and the preservation of natural resources as key issues.

Environmental Efficiency(CO2 emissions per unit of sales)

52.09

47.77

38.09

40.77

28.23

Quantity of Renewable Energy Delivered (kWh)10,257

11,017

11,017

11,017

11,146

Waste Processing Logistics Handling Volume (t)8,889

10,943

8,817

9,371

7,579

Investment in the environment (million yen)

3,677

3,854

3,202

4,444

3,584

* All figures are the total number of employees and differ from the figures listed in securities reports.

15 SBS GROUP Integrated report 2022

BUSINESS
Our businesses

General Logistics
Business

Food Logistics
Business

The SBS Group continues to implement aunique business model that has enabled
growth while balancing logistics operations,
M&A activities and the development of logistics facilities. At the same time, we enhance competitiveness by actively investingin IT and LT while accelerating collaboration
with other industries, and aim to reach the
top tier of the logistics industry.

Medium-to-long-term value creationand capital adequacy

Rolling out 3PL in every direction

Financial Capital

Upgrading the delivery network

Achieve net sales of 500
billion yen at an early stage
and look further ahead

LT×IT
Increasing logistics facility floor area

Property

OUTCOMES

M&A activities and pursing synergy

Management
Business

CSR
Social responsibility

Environment

Capital for the Provision of
To fulfill our social responsibility as a logistics company, we have set up promotionalorganizations (Group meetings) to address
important themes across four fields, namely
environment, safety, social and governance.
Through this framework we promote activities that span the Group and work to share
information.
Consideration of the environment●

Promotion of the medium-to-long-term
environmental plan

Ensuring safety●

Safety & Social●

GovernancePursuing zero accidents

Social engagement
Maintaining and improving the quality of transportation and service, developing humanresources, ensuring occupational health andsafety, making social contributions

Sound management●

Enhancing the governance framework andinternal control, ensuring thorough compliance,
taking risk countermeasures

Services
Logistics systems that respondto the evolving needs of society

Human and organizational
capitalMaximizing the capabilities ofeach human resource andGroup synergyIntellectual Capital
Accumulating and utilizing theexpertise that will support future
3PL/4PL business models

FOUNDATIONFoundation of
corporate activities

Social CapitalManagement
Philosophy

SloganCode of Behavior

By achieving the Group Management Philosophy and Code of Behavior establishedbased on its founding spirit, the SBS Group
maintains a positive relationship with its
stakeholders and endeavors to build an effective management structure by enhancing
the efficiency, soundness and transparencyof its management.

Building trust andcooperative relationships
with a wide range ofstakeholders

Natural Capital
Roadmap for achieving the 2°C
target for climate change

SBS GROUP Integrated report 2022

16

Business Overview and Financial Status

Business Environment■ Logistics BusinessIn fiscal 2021 (January 1, 2021 to December 31, 2021), the
COVID-19 pandemic that began in the previous year continued tospread, and the associated state of emergency declarations issued
throughout the country had a significant impact on economic activity.
However, e-commerce-related markets including those for daily
necessities and online shopping have continued to expand, and the
SBS Group has strived to actively respond to meet this demand
while giving top priority to preventing infections and ensuring thesafety of customers, partners and employees.
Additionally, from November 2020, a number of companies joined
the SBS Group, starting with Toshiba Logistics Co., Ltd. andfollowed by Toyo Warehouse & Transportation Co., Ltd., K.U.K. LINE
Co., Ltd., Hinomaru Kyuso Co., Ltd., Jas Co., Ltd. and Furukawa
Logistics Co., Ltd. This further enhanced our service lineup and put
in place a structure that will firmly support the logistics supply chain.

In the Logistics Business, in addition to expanding transactions
with existing customers, we focused on acquiring new customers
looking for advanced logistics functions. As shown on the left, in
addition to making Toshiba Logistics Co., Ltd. and Toyo Warehouse& Transportation Co., Ltd. new consolidated subsidiaries,
intercompany logistics that was hit hard by the spread of COVID-19
has recovered, including overseas, and together with the capturing of
e-commerce demand in the same-day delivery business andexpanded demand for logistics associated with daily necessities andonline supermarket usage, logistics operations overall saw strong
performance. Net sales in the Logistics Business rose 137.517 billion
yen (up 57.1%) year on year to 378.335 billion yen, with operating
income up 9.555 million yen (up 159.5%) over the same period to
15.546 billion yen.

■ Property Management Business

Sales and Profits
Net sales in fiscal 2021 were 403.485 billion yen, an increase of
146.293 billion yen from the previous fiscal year (a 56.9% increase
compared with the previous fiscal year). The logistics businessaccounted for 93.8% of net sales by value, while the property
management business and other businesses accounted for 4.2%
and 2.0% respectively.
Operating income stood at 20.706 billion yen, rising 9.746 billion
yen over the previous fiscal year (an 88.9% increase).
Additionally, net income attributable to owners of parent rose
3.964 billion yen year on year to end at 10.790 billion yen, a 58.1%
jump.
The net sales and each income level achieved new records.

Net sales

403.4

billion yen

378.3 billion yen +57.1%

Logistics Business17.0 billion yen +82.3%

Property Management Business8.1 billion yen +15.4%

Other Businesses

Operating
Income20.7

billion yen+88.9%

15.5 billion yen +159.5%

Logistics Business
Property Management Business

Net income
attributableto ownersof parent+56.9%

6.3 billion yen +39.0%

Other Businesses

0.4 billion yen +71.0%

Adjusted-15 billion yen

10.7

17 SBS GROUP Integrated report 2022

billion yen+58.1%The Property Management Business comprises the development
business and rent business. In the development business, we pursue
an integrated approach to developing large-scale warehouses thatmeet customers' logistics needs from land acquisition to
construction, in order to promote 3PL and 4PL businesses. In therent business, we generate rental income from Group-owned
warehouses, office buildings, residences and other properties. SBS
Holdings securitizes logistics real estate to recoup funds for future
investment, and income recorded from securitization is included in
the property management business.
In terms of the results of logistics real estate securitization in thefiscal year under review, trust beneficiary rights in the Nanko Logistics
Center (Osaka) were transferred. In connection with this, revenue
exceeded that generated in the previous year from the securitizationof logistics real estate, and as a result, net sales in the Property
Management Business rose 7.694 billion yen (up 82.3%) to 17.043
billion yen, with operating income rising 1.775 billion yen (+39%) to
6.333 billion yen.

■ Other Businesses
The main other businesses are a worker dispatch business,marketing business, solar power generation business andenvironmental business. Net sales rose 1.081 billion yen (up 15.4%)
year on year to 8.106 billion yen, with operating income up 180
million yen (up 71.0%) over the same period to 435 million yen.

Capital Investment
The SBS Group has actively pursued investments in logistics
facility development and plans to increase the total floor area offacilities developed in-house by approximately 430,000 square
meters (approximately 495,000 square meters when leasing is also
included) over a six-year period from 2018 to 2023.
Capital investments made in fiscal 2021 totaled 14.500 billion yen.
In the Logistics Business, we made investments of 12.544 billion yen
on the acquisition of land for logistics facilities and their construction,
routine vehicle upgrades, and so on. In the Property Management
Business, total investments of 145 million yen were made in areas
such as repairs for lease properties. In Other Businesses, 128 million
yen was invested in routine vehicle upgrades and other things. In
terms of company-wide assets, investments totaling 1.682 billion yen
were made in areas such as the purchase of software for in-house
use and interior construction at the new head office. In the fiscal year
under review, there were no major disposals or sales of equipment.

Factorial Analysis of the Change in Net Sales inthe Logistics Business (100 million yen)

Net Sales (million yen)
2017

152,870
203,516

2018

2,408

2020

+1,144Contribution of SBS Toshiba Logistics

2019

255,548

Contributions of Toyo Warehouse & Transportation,
K.U.K. LINE, Hinomaru Kyuso and Jas

2020

257,192

Sharp rise in marine and air freight charges
Contribution of new logistics sites

403,485

2021

+51
+83
+23

Increase in B-to-C logistics volume,
new development, fee optimization

2021

+104

3,783

+1,375 million yen (+57.1%)
Composition of net sales by business

Factorial Analysis of the Change in Operating
Income in the Logistics Business (million yen)
2020

93.8%

Profit contribution of SBS Toshiba Logistics■ Property Management Business 4.2%

Increase in B-to-B logistics
volume, new development, etc.

■ Logistics Business
Fiscal 2021

5,990

■ Other Businesses

2.0%+6,558+2,827+617

Fee optimization+1,073

Reductions in other expenses, etc.
Launch of new logistics sites-923

Increased amortization of goodwill, etc.
Sharp rise in unit prices for light oil

Operating Income and Ordinary Income (million yen)
2017
2018

6,229
6,475

-150

-447

15,5462021+9,555 million yen (+159.5%)■ Operating income■ Ordinary income

8,240
7,607

2019

10,176
10,172

2020

10,96010,88320,706
20,4892021

Capital investment of

14.5

billion yen

Change in Capital Investment Amount (million yen)
2017

2018

2019

2020

2021

Total
Logistics
Business
Property Management
Business

9,576

11,607

11,71011,507

14,501

8,727

10,77010,89910,971

12,544

691

502

153

75

145

Other Businesses

60

151

319

107

128

Company Assets

-

-

-

-

1,682

Net Income Attributable to Owners of Parent (million yen)
2017
2018
2019
2020
2021

4,446
4,409
6,079
6,826
10,790* Amount of purchases of software for in-house use was previously included under"Other Businesses" but has been included under "Company Assets" from 2021.

SBS GROUP Integrated report 2022

18

Business Overview and Financial Status

Assets and Liabilities

Cash Flow

Total assets as for the fiscal year stood at 277.197 billion yen, an
increase of 22.646 billion yen from the end of the previous fiscal
year. This was due to an increase in inventories associated with landacquisition for the construction of a logistics warehouse, and anincrease in fixed assets due to the addition of Toyo Warehouse &Transportation Co., Ltd. as a consolidated subsidiary.
Liabilities stood at 196.489 billion yen, an increase of 10.085
billion yen compared with the end of the previous fiscal year. This ismainly due to an increase in long-term loans payable in connection
with the acquisition of shares in Toyo Warehouse & Transportation
Co., Ltd.
Net assets stood at 80.707 billion yen, an increase of 12.561
billion yen compared with the end of the previous fiscal year. The
increase was due to higher retained earnings resulting from therecording of net income attributable to owners of parent and anincrease in non-controlling interests.

As of December 31, 2020, cash and cash equivalents ("cash,"hereafter) had decreased by 3.741 billion yen to 23.795 billion yen
from the end of the previous fiscal year. The main reasons for thechanges in each cash flow are as follows.

Trends in Finances
Working from a medium-to-long-term perspective, the SBSGroup intends to achieve the sustainable growth of its businesses
and boost earnings capability and capital efficiency. Additionally, as
a part of key business and investment strategies, we will promote
the unique business model of pursuing the stable growth of the 3PL
and 4PL businesses by systematically iterating on a cycle of the
in-house development and securitization of logistics facilities. Due tothis approach, we have placed an emphasis on maintaining abalance between active investment activities and maintaining
financial health, have set a target shareholders' equity ratio of 30%,
and position this as a decision-making indicator.
In fiscal 2021 the shareholders' equity ratio was 21.9% (up 2.0%
year on year).
Meanwhile the net DE ratio, which represents the ratio of net
interest-bearing debt to shareholders' equity, has been trending
downward due to profit accumulation after peaking in fiscal 2015. In
the previous year it temporarily rose to 1.39 due to M&A activity, but
improved to 1.19 in the fiscal year under review due to profit
accumulation.
Moving forward, we will continue to undertake business operationthat is mindful of financial health and pursue the optimum balance
between investment and returns.

Shareholders’ equity ratio

21.9

%

■ Cash Flows from Operating Activities
Net cash provided by operating activities was 27.472 billion yen(inflow of 17.262 billion yen in previous fiscal year). This was mainly
due to an increase in income before taxes and other factors in thebottoming out of profitability.

■ Cash Flows from Investing Activities
Net cash used in investing activities was 22.343 billion yen(outflow of 30.48 billion yen in previous fiscal year). This was mainly
due to the acquisition of fixed assets such as vehicles andequipment, and the new acquisition of shares in Toyo Warehouse &Transportation Co., Ltd.

■ Cash Flows from Financing Activities
Net cash used in financing activities was 9.278 billion yen (inflow of
22.726 billion yen in previous fiscal year). This was mainly due to theproceeds from 26 billion yen in long-term loans payable, comparedwith the repayment of long-term loans payable of 11.802 billion yen,a net decrease in short-term loans payable of 20.18 billion yen, anddividends paid to the amount of 1.39 billion yen.

Balance of Cash and Cash
Equivalents as ofDecember 31, 2020

billion yen

Shareholder Return
The Company considers the return of profits to shareholders to be
one of its most important management priorities. The Company’s
basic policy on the distribution of profits is, while retaining sufficientinternal reserves, to maintain continuous dividends, and improve thelevel of dividends in line with business performance.
The Company's basic approach is to pay once-yearly dividends ofsurplus funds. In comprehensively taking in to account the results inthe fiscal year under review and the Company's financial status, ayear-end dividend of 55 yen per common share was issued. This
represents an increase of 20 yen per share compared with theprevious fiscal year.

Year-End Dividend
Per Common Share

19 SBS GROUP Integrated report 2022

23.7

55

yen

Change in Consolidated Balance Sheet (100 million yen)

Change in the Balance of Cash and Cash Equivalents(100 million yen)

As ofDecember 31,

1,045

Current assets

2020

+170

1,215

254.5

+56

1,556

+274

Total Assets:

1,500

Fixed assets

275

2020

-223

billion yen

-50

1,060

Total Assets

753

Long term
liabilities

+226

+151

904

billion yen
As ofDecember 31,

+125

807

2021

Change in the Shareholders’Equity Ratio■ Shareholders’ equity■ Total assets (100 million yen)2012 274

1,044

26.3

2013 289

1,083

26.7

2014 318

1,311

24.3

2015 280

1,248

22.5

2016 325

1,223

26.6

2017 364

1,278

28.5

237

2021

Cash Management System Utilization
The main working capital of the SBS Group is sales cost including vehicle hire,outsourcing expenses and personnel expenses, and operating expenses including
selling, general and administrative expenses. Additionally, demand for funds aimed
at investment includes routine vehicle upgrades, the acquisition of shares insubsidiaries and affiliate companies, the acquisition of land associated with logistics
facilities developed in-house, the costs of construction work, capital investment, andso on.
The SBS Group procures the funds required for the entire Group in a centralizedfashion through its holding company. In addition to receiving lines of credit frommultiple banks so that working capital can be secured flexibly, the SBS Group also
procures long-term funding in a systematic fashion to address the capital demand
for the purpose of investment. The procured funds are put to the best and mosteffective use within the Group through a cash management system. Specifically, thissystem adjusts funding surpluses and shortages between subsidiaries (cash pooling)
and performs payment operations on their behalf.

Change in Dividends (yen)2018 397

1,717

23.1

2013

2019 451

1,800

25.1

2014

19.9

2015

0

21.9

2016

17

2017

18

2020

507

2021

606

2,545
2,771

Shareholders' equity ratio (%)

2018
Change in Net DE Ratio

Financing CF

277.1

681

Net assets

Investing CF

-92

1,111

Current
liabilities

Operating CF■ Shareholders’ equity■ Net interest-bearing debt (100 million yen)

2019

2012

274

381

1.39

2020

2013

286

392

1.37

2021

2014

307

512

1.66

2022

2015

264

515

1.95

2016

319

471

1.48

2017

357

449

2018

393

565

1.44

2019

445

539

1.21

2020

502

2021

596

30

10

■ Regular dividend40
15June 2014
1:3 Stock Split

16
3■ Regular dividend

33

21
22

Quarterly dividend basedon the end of March 2016
standard: 16 yen +year-end dividend: 17 yen

30
35
55
59
(planned)

1.26

700
708

1.39
1.19
Net DE ratio (times)

Net Interest-bearing Debt = Long-term Debt & Short-term Debt + Corporate Bonds - Cash and Deposits
Net DE Ratio = Net Interest-bearing Debt ÷ Shareholders' Equity

SBS GROUP Integrated report 2022

20

External Environment and Mid-to-Long-Term Management Strategy

The SBS Group takes a broad view of external environmental changes in implementing its medium- and long-term
management strategies. Based on the concepts of being a "group of 3PL companies possessing logistics functions inevery direction" and a "mega venture," we continue to strengthen our comprehensive proposal-making capabilities,
expertise and problem-solving abilities while establishing a management base.

The External Environment Surrounding the SBS GroupThe SBS Group identifies and analyzes the short-, mid- and long-term impacts due to changes in the external environment,
and uses that insight as a basis for formulating management strategy and reviewing strategy in a flexible manner.

EconomyMarketChanging consumption patterns due to the COVID-19 pandemic

Diversification of services / high frequency and small lots / last

/ slumping employment and income environment, inboundmile delivery issues / need for stable and flexible transportation

demand and capital investment sentiment / destabilization of

capacity / increased competition due to e-commerce operators

share markets / stunted expansion of global economy due todevelopment in-house logistics systems / cooperation on

COVID-19 pandemic / uncertainty in international affairs /logistics / complementary logistics functions and services /requirement to recognize climate change and disclose climate

alliances with other companies including those in the samechange action / ESG requirements / expansion of the sharing

industry / fluctuating energy prices

economyMedium-to-long-term Management Strategies■ The Simultaneous Pursuit of Co-existence, Symbiosis■ Securing the Human Resources to Support theand Synergy in M&A Activities

Logistics Business and Facilitating Their SuccessThrough M&A activities, regarded as a pillar of its management
strategy, the SBS Group pursues coexistence and symbiosis rather
than dominance. We maintain the employment of staff and welcome
new human resources into the Group. We also implement measures
to enhance Group-wide synergistic effects, including market
development, expanded sales channels, and the sharing andenhancement of service provision, knowledge, people andorganizational capital. These post merger integrations (PMIs) are
positioned as a pillar of our current growth strategy, as they ensurethat the series of M&As we have carried out bear results and are
crucial in maximizing those results.

To continue to achieve future growth, it will be essential to retain
the logistics human resources promoting our core 3PL business, theglobal human resources driving overseas development and theprofessional human resources driving logistics facility development
and incorporating future technological innovations. At the same time,with the dwindling working population, we see the stable retention ofdrivers and other management resources that support thefoundations of the logistics business as a key management issue.
To that end, we are taking steps to improve personnel systems,
hire and cultivate talented human resources, and develop a
workplace environment in which each individual employee withdiverse capabilities and backgrounds can enjoy job satisfaction,
pride and motivation. In developing the workplace environment, we
will also consider the public health risks that have become evident
due to the spread of COVID-19.

■ Business Expansion Leveraging 3PL as a Strength
Our business structure is being developed around a core ofthird-party logistics (3PL), which involves providing comprehensive
logistics services to shippers. We are also enhancing our strengths
by expanding new orders gained through web marketing andenhanced sales activities, pursuing improved efficiency throughstronger field capabilities and investment in LT/IT, and expanding ouroperating base through the development of logistics facilities.

■ Maintaining Financial Health Through the Logistics
Facility Development Cycle
We work to develop logistics facilities in-house in order topromote the expansion of the 3PL business and higher service
levels, and maintain financial health through the systematic
securitization of existing facilities.

21 SBS GROUP Integrated report 2022

■ Continual Promotion of CSR Management
In addition to ensuring work safety and taking measures toprevent traffic accidents, we implement thorough environmental
conservation initiatives, including the promotion of eco-driving andmeasures to reduce the environmental impact attributed to ourvehicles and logistics facilities.
Moreover, we pursue the further enhancement of our corporate
governance system that includes these initiatives.

■ Initiatives to Address Logistics Industry-Wide Issues
We seek out collaboration with strong partners while promoting
initiatives that help solve the short-, mid- and long-term issues facing
the logistics industry from various angles. These initiatives mainly
address the shortage of truck drivers and climate change.

Technology

Society

Logistics DX in general / supply chain management (SCM) / IoT

Development of COVID-19 into a pandemic / materialization ofand AI / big data / data warehousing / automation and robotics /the effects of climate change / need to appropriately operate and

AutoStore / telematics / ETC 2.0 / EVs / autonomous driving /manage vehicles, and strengthen safety measures / increasingly

dronesserious labor shortages / truck driver work environment /expected increase in foreign workers / long-term decline inworking age population / revisions to labor laws / need to
improve productivity of Japan overall / human rights issues inJapan and overseas / diversity & inclusion requirements

SBS' Unique Logistics Facility Development Model

3PL business cycle
Development cycle

Customerdevelopment

●

●

●

Confirming customer needs
Collecting land information
Recovery of investment
funds

Stableoperation

Securitization●

Obtainingapproval for
intendeduse●●

Logistics
facility
development

Start ofconstructi
on

Logistics facilities, planning and design of LT and IT
Selection of construction companies
Formulation of property acquisition schemes

Receipt oforder forproposal

The SBS Group's Logistics Facility Development Track Record●●●

Finance and real estate market
analysis
Refinancing negotiations withfinancial institutions
Negotiations with prospective
buyersConstruction

●

●

●

Selection of PM
company
Leasing
Formulation of
repair plan

Development
Results

23 buildings Total Floor Area Approx. 629,000 meters

On hold

12 buildings Total Floor Area Approx. 198,000 meters

Securitized

11 buildings Total Floor Area Approx. 429,000 meters

Lease backSite startup

squaresquaresquaresquare8 buildings Total Floor Area Approx. 347,000 meters* Properties developed in-house including securitized properties account for about
a quarter of operating area, or approx. 2.52 million square meters

Recovery phase

Investment phase
SBS GROUP Integrated report 2022

22

Rolling out 3PL

The SBS Group emphasizes 3PL that comprehensively supports corporate logistics and isfurther enhancing its strengths in this area. We are also tackling 4PL, which helps solve
management issues from a strategic and organization-wide perspective.

3PL is positioned at the core of ourmanagement strategy

Ongoing Improvements to 3PL Infrastructure

3PL (third-party logistics), which the SBS Group positions at thecore of its management strategy, is a service where we propose
logistics reforms to consignors and are entrusted with their logistics
operations on a comprehensive basis. To achieve the ideal form oflogistics envisaged by customers, we plan and operate a range of
operations arising in the supply chain on behalf of customers,
including transportation, packing, storage, cargo handling andinformation management.
The SBS Group defines logistics services meeting the criteria of
direct contracts with consignor companies, medium-to-long-termplans and the joint entrustment of multiple services as 3PL. We
consistently work to maximize the benefits of 3PL. Based on the
low-cost operations the Group has honed, we flexibly combine
various elements including consulting, information systems andlogistics centers to provide valuable 3PL services to customers invarious industries and lines of business.
The Ministry of Land, Infrastructure, Transport and Tourism hastaken a multifaceted approach to support measures including thedevelopment of laws and guidelines, special tax exemptions forlogistics sites and facilities and the development of humanresources, based on the belief that logistics efficiency improvements
through the spread of 3PL will not only improve the productivity ofindustry and the economy as a whole, but also pose considerablesocial benefits such as reduced CO2 emissions.

To deliver the benefits of 3PL services to as many customers as
possible, the SBS Group is systematically developing its business
infrastructure.
Logistics facilities are the most important element as infrastructure
supporting 3PL. The SBS Group has made it a goal to develop
logistics facilities with a total operational area of one million tsubo(approx. 3.3 million square meters). As of the end of 2021, ourlogistics facilities including those currently being planned account for
960,000 tsubo (approx. 3.17 million square meters), showing thatour goal is almost within reach (see table below).
Improving the efficiency of logistics through 3PL is accelerated by
the development of logistics technologies (LT). Through proactive
investment in LT and IT, the SBS Group is making progress in
updating and redesigning the entire logistics systems it operates.
Through the introduction of the latest technologies including robots
and AI systems, logistics facilities are the basis for a new generationof 3PL services.
We are concentrating on improving and updating our operating
vehicles, innovating our management techniques, developing andreorganizing 3PL-related organizations and continually investing inhuman resources responsible for implementing 3PL.
In addition, as a mechanism supporting 3PL from a finance
perspective, we have established a cycle of logistics facility
development-centric investment and recovery, and a cash
management system that ensures flexible working capital (see page20), as part of a series of improvements connected with businessgrowth and environmental changes.

Plans for Increased Logistics Facility Floor Area
Name

Location

Timing of Operation(Consolidated)

Type

Operational Area as of December 31, 2020

Total floor area / tsubo

Operating Companies

531,000

SBS Toshiba Logistics

Nationwide

January 2021

M&A

200,000

SBS Toshiba Logistics

Toyo Warehouse & Transportation

Kanagawa and Tokyo

January 2021

M&A

18,000Toyo Warehouse & Transportation

Kanagawa

October 2021

In-house

16,200SBS Ricoh Logistics

Yokohama Kanazawa Logistics Center

765,200

Operational Area as of December 31, 2021
SBS Furukawa Logistics
Logistics Center Atsugi Morinosato
Ami Logistics Center 2

January 2022

M&A

23,000SBS Furukawa Logistics

Kanagawa

May 2022

Lease ofentire building

17,400SBS Ricoh Logistics

IbarakiJune 2022

In-house

5,300

SBS Flec

Nationwide

Logistics Center Ichinomiya

Aichi

April 2023

In-house

21,100SBS Ricoh Logistics
SBS Asset Management

Building A, Seto, Noda

Chiba

January 2024

In-house

50,800SBS Asset Management

Building B, Seto, Noda

Chiba

PlannedIn-house

39,500SBS Asset Management

Tomisato Land

Chiba

PlannedIn-house

30,000SBS Asset Management

Tokorozawa Land A

SaitamaPlannedIn-house

10,000SBS Logicom

Tokorozawa Land B

SaitamaPlannedIn-house

4,500

SBS Sokuhai Support

Plans for Increased Floor Area from January 2022 Onward

201,600

Total Operational Area (existing + planned facilities)

966,800 tsubo (approx. 3.19 square meters)

23 SBS GROUP Integrated report 2022

Rollout of 3PL in Each Region
The SBS Group, which is a collection of logistics business
operators with a diverse range of strengths, is rolling out 3PL in a
multifaceted way.
SBS Logicom Co., Ltd., a logistics company affiliated withmultiple electric railway companies in the past, provides 3PL
services to customers across various industries including
manufacturers, retail chains and e-commerce businesses, and is
involved with a wide range of operations from integrated
international transportation to logistics center operation and store
deliveries. The company also has a track record of accepting
contracts to strengthen logistics functions as a business continuity
planning (BCP) initiative.
SBS Flec Co., Ltd, which provides food logistics at the threetemperature zones (refrigerated, frozen and room temperature),
p rovides Fo od 3 PL se rvi c e s t ha t offe r on e -st op l og is t ic s
management services from food production sites to customers. The
Company responds to the need for food safety and security, taking
action by expanding trading zones, as well as streamlining logistics
and reducing its costs.
SBS Ricoh Logistics System Co., Ltd., which boasts a trackrecord as a logistics subsidiary for a precision equipment
manufacturer, provides 3PL services that make full use of its
technologies, expertise and business infrastructure. In addition tologistics for precision equipment, the company supports a wide
range of customers spanning everything from electrical component
and machinery component logistics that require high levels of
expertise to procurement and production logistics catering to theneeds of factories, logistics for mass retailers supporting increasingly

complex delivery services and office e-commerce logistics, as well
as logistics for cosmetics and quasi-drugs.

4PL as an Evolved Form of Logistics
Taking 3PL one step further, 4PL describes the SBS Group's
efforts to propose and realize logistics strategies that reflect
customer management strategies (and solve management issues).
From a medium-to-long-term perspective, we conceptualize
measures aimed at optimization of the entire supply chain, andpromote those measures together with customers.
Toshiba Logistics Corporation, which has built up experience inproviding solutions from a management perspective as a subsidiary
allotted logistics functions for an electric appliance manufacturer,
has added more advanced 4PL-based operations to the services of
the SBS Group by becoming a Group company.

EC Logistics Based on 3PL and 4PL
The SBS Group plans to operate an e-commerce (EC) logistics
service by the end of 2022. With the Business Strategy Departmentof SBS Holdings playing a leading role, the LT Planning Department
driving the introduction of LT across the SBS Group and young
leaders with expert knowledge at each Group company areorganizing this Group-wide project. Based on 3PL and 4PL, we will
utilize knowledge of know initiatives including fulfillment and last miledelivery to build services that leverage the SBS Group's uniquestrengths. We aim to generate 100 billion yen in net sales by FY2030.

TOPICS
Launch of the Yokohama Kanazawa Logistics Center (October 2021)
In October 2021, the Yokohama Kanazawa Logistics Center was completed, and began operating
as the first large-scale 3PL center developed by the SBS Group using cutting-edge LT and IT.
The facility caters to the expansion of logistics value in the Kanto area, and mainly handles 3PL
operations for the Tanomail office supply e-commerce business operated by Otsuka Corporation.
SBS Logicom Co., Ltd. undertook construction of the facility, spending roughly two years on theendeavor as a project that took advantage of synergies within the SBS Group. The development
concept was "automation, labor saving and space saving." Using two AutoStore units, a robotic
storage system with at least three times the storage capacity compared with conventional storage
equipment, the digital picking system has been enhanced, and automation equipment including
automated packing machines and shuttle racks have been installed. In addition, through integration
with support systems that utilize AI and big data, automation, labor saving and storage efficiency are
all improved.
The facility employs a seismically isolated construction, and is equipped with the latest business
continuity planning (BCP) functions including emergency generators and redundant networks andsystems. Moreover, the entire facility uses LED lighting and has solar power generating equipment for
in-house consumption installed.

SBS GROUP Integrated report 2022

24

SDGs at the SBS GroupThe SBS Group is keenly aware of its responsibility as a company handling logistics as a key partof social infrastructure. We also place an importance on the sustainable development goals (SDGs)
and their role in providing direction for solutions to the various issues facing the world. Helping toachieve the SDGs is one of the key aspects to our management policy.

The Future Vision the
SBS Group is Shaping
Through the SDGs
Build efficient and sustainable logistics
systems in Japan and around the world

Maximize opportunities for social
activities to be helpful

Making full use of evolving technologies, we will take the convenience,safety and environmental performanceof logistics systems - the foundation ofsocial lives and industrial activity - tothe next level.

To the extent that is reasonably possible, we will maximize opportunities forlogistics systems to contribute to social
activities across a wide range of actions, from the transportation of relief
supplies to the promotion of recycling.

Make opportunities for anyone todemonstrate their individuality andsucceed the new normal

Expand partnerships with a diverse range

To build an inclusive world, we will
create direct and indirect opportunities
for all kinds of people to demonstrate
their individual and pursue their true
potential.

of entities to every corner of society
In each area where the SBS Group operates, it will expand cooperative relationships with a wide range of parties, fromgovernments and financial institutions
to research organizations, non-profit
groups and individual consumers.

The SBS Group views the SDGs as its vision for
creating a better world with all stakeholders
towards the year 2030. Additionally, in thecontext of the SBS Group's business activities,
we have shaped four future vision and are
pursuing efforts aimed at its realization.

25 SBS GROUP Integrated report 2022

The 12 SDGs the SBS Group is Currently Tackling
Goal

Targets Towards 2030

Current Initiatives

End hunger, achieve food security
and improved nutrition andpromote sustainable agriculture

2.1: End hunger and ensure access by all people, in particular
the poor and people in vulnerable situations, including
infants, to safe, nutritious and sufficient food all year round.

Ensure healthy lives and promote
well-being for all at all ages

3.6: Halve the number of global deaths and injuries from roadtraffic accidents.
3.9: Substantially reduce the number of deaths and illnesses
from hazardous chemicals and air, water and soil pollution
and contamination.

Ensure inclusive and equitable
quality education and promote
lifelong learning opportunities
for all

4.3: Ensure equal access for all women and men to affordable
and high-quality technical, vocational and tertiary
education, including university.
4.4: Substantially increase the number of youth and adults who
have relevant skills, including technical and vocational skills,
for employment, decent jobs and entrepreneurship.

Achieve gender equality andstrive to empower all women andgirls

5.1: End all forms of discrimination against all women and girls
everywhere.
5.5: Ensure women’s full and effective participation and equal
opportunities for leadership at all levels of decision-making
in political, economic, and public life.

Ensure access to affordable,
reliable, sustainable andmodern energy for all

7.2: Increase substantially the share of renewable energy in the
global energy mix.
7.3: Double the global rate of improvement in energy efficiency.

Promote sustained, inclusive
and sustainable economic
growth, full and productive
employment and decent work
for all

8.2: Achieve higher levels of economic productivity throughdiversification, technological upgrading and innovation,
including through a focus on high-value added andlabor-intensive sectors.
8.5: Achieve full and productive employment and decent work
for all women and men, including for young people andpersons with disabilities, and equal pay for work of equalvalue.
8.8: Protect labor rights and promote safe and secure working
environments for all workers, including migrant workers, inparticular women migrants, and those in precarious
employment.

Build resilient infrastructure,promote inclusive andsustainable industrialization,and foster innovation

9.1:`Develop high-quality, reliable, sustainable and resilient
infrastructure, including regional and trans-borderinfrastructure, to support economic development andhuman well-being, with a focus on affordable and equitable
access for all.
9.4:`Upgrade infrastructure and retrofit industries to make themsustainable, with increased resource-use efficiency andgreater adoption of clean and environmentally soundtechnologies and industrial processes, with all countries
taking action in accordance with their respective
capabilities.

Make cities and humansettlements inclusive, safe,
resilient and sustainable

11.2: Provide access to safe, affordable, accessible andsustainable transport systems for all, improving roadsafety, notably by expanding public transport, with special
attention to the needs of those in vulnerable situations,
women, children, persons with disabilities and older
persons.
11.6: Reduce the adverse per capita environmental impact of
cities, by paying special attention to air quality andmunicipal and other waste management.

Ensure sustainable consumption
and production patterns

12.5: Substantially reduce waste generation through prevention,
reduction, recycling and reuse.

●

13.3: Improve education, awareness-raising and human andinstitutional capacity on climate change mitigation,
adaptation, impact reduction and early warning.

●

Take urgent action to combat
climate change and its impacts
Protect, restore and promotesustainable use of terrestrial
ecosystems, sustainably manage
forests, combat desertification, andhalt and reverse land degradationand halt biodiversity loss

15.2: By 2020, promote the implementation of sustainable
management of all types of forests, halt deforestation,
restore degraded forests and substantially increaseafforestation and reforestation globally.

Strengthen the means of
implementation and revitalize theglobal partnership for sustainable
development

17.17: Encourage and promote effective public, public-private
and civil society partnerships, building on the experienceand resourcing strategies of partnerships.

●

Support by providing logistics services tofood bank groups (transportation andstorage of donated food)

Promotion of transportation safety
management aimed at zero serious
accidents●
Introduction of next-generation vehicles andpromotion of eco-driving●

Systematic education and training plans
based on the Basic Policy on Human
Resource Development●
Scholarship Program (SBS Kamata
Foundation) for students receiving social
care
●

●

●

●

Creating a workplace in which women can
succeedTransmission of renewable energy throughsolar power generation
Improved fuel efficiency

Maintaining and expanding employment,
ensuring decent work
Promotion of diversity●
Declaration on respect for human rights andelimination of harassment●●

Strengthening and expanding logistics
functions as social infrastructure
Promoting logistics DX●
Fostering logistics research (SBS Kamata
Foundation)
●

●

●
●
●

●

●

●

●

●

Improving last mile logistics
Addressing modal shift
Development of green logistics services

Recycling waste
Expand functions of the venous logistics
business
Reducing the carbon footprint of vehicles
and facilities
Climate Change Risks andCountermeasures

Supporting groups engaged in forest
preservation activities

Partnerships associated with businessactivities and CSR management
Support for the social sector

SBS GROUP Integrated report 2022

26

Controlling Management Risks

Uncertainty in the management environment for logistics business operators has increased due to the COVID-19
pandemic and a fluctuating international climate. The SBS Group takes a broad view in identifying risks that could impact
management results, financial situation or share price, analyzes the nature and impact of these risks, and responds tothem in a more precise manner.

Risk Management Policy and System

Major Risks to be Addressed

The SBS Group has established the SBS Group Risk
Management Regulations and endeavors to manage all risk events
that could pose threats to management activities. In addition to risks
whose effects are immediately apparent, risks we determine need tobe addressed from a medium or long-term perspective are also
subject to management.
We have also established the SBS Group Risk Management
Council, comprising members selected from SBS Group companies,
to ensure that risk management is continually implemented on aGroup-wide basis. At meetings generally held twice a year, thecouncil separates risks into Group-wide risks and risks affecting
individual Group companies, monitors the status of measures to deal
with each risk, and strives to prevent risks from occurring or
minimize the damages that occur in the event of an emergency.

We have currently established 15 categories of risk events thathave the potential to affect the SBS Group's short, medium andlong-term management results, share price and financial condition.
While the risks differ as to whether they are mainly caused byexternal factors, caused by mistakes or other action by the SBSGroup or exhibit both aspects, we manage all of these risks in acomprehensive fashion in the interest of enhancing the soundness
and continuity of management.
Additionally, in light of the enormous impact on the global
economy and business activities of the SBS Group due to the
COVID-19 pandemic, from fiscal 2020 "risks associated withpandemics" have been added as a new risk event.

The Risk Management Process● Basic Policy

SBS Holdings and each Group company start by identifying therisks to be handled by each department. Next, factors including the
likelihood of occurrence, impact and potential for control are
carefully examined and analyzed for each risk. We then implement
response measures and work to prevent or minimize damages andlosses due to risks.
The SBS Group Risk Management Council receives reports fromSBS Holdings and Group companies to verify and evaluate theimplementation status and effectiveness of the measures taken toaddress risks. The results of the evaluation are reported to the SBSGroup CSR Promotion Committee for approval.
This cycle is repeated annually in an effort to not only ensure thatexisting risks are being appropriately handled, but to response
quickly to newly emerging risks.

SBS Group Risk Management Regulations (Key Points)
In light of the social significance of the SBS Group, on a daily
basis its officers and employees shall manage risks by placing thehighest priority on safeguarding human life and ensuring safety, andin the event a risk occurs, endeavor to contain the risk, minimize
damages and enable a quick recovery.
● Establishment and Operation of the Risk Management

CouncilMonitoring, evaluation and approval of measures to address risks● Emergency Risk Response

Establishment of Business Continuity Plan

Report to CSR Promotion Committee

The Risk Management Process

Verify and evaluate

Implement response measures

Examine and analyze

Identify

27 SBS GROUP Integrated report 2022

SBS Group Risk
Management Council

Management Status of Major Risks

Risks due to changes in
economic conditions[Short-term]
Likelihood of
Occurrence

Overview

EffectResponse Status

The businesses operated by the SBSGroup are affected by economic andbusiness trends in Japan and overseas, and by -fluctuations in transportation demand among enterprise customers.

In the event of sluggish consumption
due to a domestic economic contraction, a fall in import/export volumes
triggered by a sharp appreciation of
the yen or a serious contraction in an
overseas economy, a reduction in thenumber of orders received or downward pressure on transportation fees
could occur.

Promotion of business diversification

The use of fuels such as light oil andgasoline is essential in the logistics
business. But when fuel prices increase due to steep rises in crude oil
prices or fluctuating exchange rates,
they represent a factor that increases
costs.

It may not be possible to changetransportation charges to reflect higher-than-expected fuel prices andequivalent increased costs due tosharp rises in global oil prices or theeffects of currency exchange markets.

Creation of budgets that incorporate
fuel price fluctuations (predictions) bykeeping close watch on market
trendsIn implementing M&A activities as animportant growth strategy and developing logistics facilities to promote
the 3PL business, we primarily procure funding through loans from financial institutions, and a worseningof the financial environment could bea factor in rising costs.

Difficulties in obtaining funding forstrategic investments, or increased
interest rates to finance loans could
occur.
Additionally, these situations could
confl-ict with provisions in the case ofdebt with financial covenants.

Measures including paying downinterest-bearing debt through thesecuritization of logistics facilities andoperating cash flow, and securing
fixed interest rates

When expanding its existing businesses and entering new fields ofbusiness, the SBS Group implements
M&A activities, capital participationand capital tie-ups as part of its business strategy. There is a risk thatthese activities might not go as wellas initially planned.

Due to unexpected circumstances,the progress of a business plan following an acquisition or tie-up could
be significantly delayed comparedwith initial forecasts.

Thorough due diligence conducted inadvance

The key activities of the SBS Group's Property Management Business are the development of real estate such as logistics facilities,
and the provision of that real estate (throughsale or leasing) to customers. If we areunable to acquire customers who will use thedeveloped real estate according to ourplans, it could be a factor in declining sales
and profits. In addition, there may be cases
in which the posting of sales and profits isdelayed or is disproportionately allocated tocertain time periods due to the timing ofwhen an order for a logistics facility is received, the scale and specifications of the
project, or the timing for completion or sale.

The impact on sales and profits whencustomers cannot be acquired asplanned could be non-negligible, depending on the investment amount.
Additionally, the same would apply if
the sales and profits were skewed towards certain time periods or delayed.

Degree of Impact

Diversification of risks by expandingusiness partners
Promotion of an enhanced andoptimized business portfolio in
conjunction with the above measures

Potential forControl

Risks due to sharp rises
in fuel prices[Short, Medium and Long-term]
Likelihood of
Occurrence
Degree of Impact*1
Potential for Control

Risks associated with aworsening financial
environment[Short-term]
Likelihood of
OccurrenceGroup Joint Purchasing
Switching to logistics services withhigher fuel efficiency through the
adoption of eco-driving practices, thephased introduction of next-generation vehicles, and other measures

Degree of Impact
Potential for Control

Risks due to M&A
activities[Short-term]
Likelihood of
Occurrence
Degree of Impact

Careful arrangements with the top
management of the company to beacquired* Even in the cases of capital participation
or tie-ups, similar action is taken

Potential for Control

Risks due to the realestate business[Short and Medium-term]
Likelihood of
Occurrence
Degree of Impact
Potential for Control

Development of logistics facilities
predicted on securing customers* We begin construction work on facilities
after determining tenant consignors andsales destinations, as well as factors suchas intended use, specifications, rent andrental period

Detailed development schedulemanagement
Preparation of various schemes tosecuritize developed logistics facilities*1. The impact rating was raised by 1 due to the seven-year high in spring 2022.

SBS GROUP Integrated report 2022

28

Controlling Management Risks

Management Status of Major Risks

Risks due to legislativechanges[Short and Medium-term]
Likelihood of
Occurrence
Degree of Impact
Potential for Control

Risks related to natural
disasters and otherincidents[Short, Medium and Long-term]
Likelihood of
Occurrence
Degree of Impact
Potential for Control

Risks associated withpandemics[Short, Medium and Long-term]
Likelihood of
Occurrence

Overview

EffectResponse Status

The SBS Group's operation is affected byvarious laws and regulations, and changes
to these laws and regulations in responseto changing social conditions. In our corelogistics business, for example, various
business laws related to logistics apply tocargo vehicle transportation operations,warehousing services and customs brokerage. In the property management business, the Building Standards Act and Financial Instruments and Exchange Act
play a part, and in personnel support, theWorker Dispatch Act must be followed.

New cost burdens could be imposed,or changes could be required in business expansion due to systems being
revised, strengthened or subjected toa different interpretation based on related laws and regulations changing
in line with changing social conditions.

Collecting information throughindustry groups and otherorganizations

The business activities of the SBS Grouprevolve around truck-based transportation and the operation of logistics centers, and these operations are susceptible to natural disasters and other incidents. In particular, the SBS Group has
situated many logistics sites in the Tokyo
metropolitan area to cater to robust logistics demand in that region, and if theTokyo metropolitan area was affected bysuch a disaster, it would have a significant impact on the SBS Group.

When an event such as a major disaster occurs, SBS Group operations
could be cut off and the Group may
be unable to provide some or all of its
logistics services, due to damage toconsignor companies or Company facilities, disruption or cutting off oftransportation networks, and the
shutdown of lifelines.

Anticipating the state of damage
through the formulation of business
continuity plans (BCP), and preparingof response measures

When an outbreak of a serious infectious disease occurs, the SBS Groupbusinesses would be forced to takemeasures not usually implemented toprevent the spread of infections, andif the situation worsened, it could
even threaten continued operations.

The outbreak of an infectious diseasecauses various restrictions on thebusiness activities of the SBS Group.
Taking measures to prevent infectious causes higher costs. In addition,
if an infected person is confirmed in
the SBS Group or shipping consignee, the SBS Group or the shipping
consignee could be forced to restrictor shut down operations.

Thorough hygiene management forbusiness sites and vehicles

As the SBS Group uses public roads
to transport customers' products andgoods by truck and other vehicles,
there is always a risk of traffic accidents.

If a major accident in which many
people's lives are lost occurred, theCompany could be sued by the victims, suffer a decline in credibility
among customers and society, or be
subjected to action imposed by authorities, such as being suspended
from operating vehicles or conducting
business.

Continued operation of SBSGroupwide transportation safety
management under the Transportation Safety Promotion Meeting

The SBS Group utilizes computersand networks for a range of applications from business systems to
manage customers’ cargo information, inventory control and customs
processing to in-house systems that
handle accounting, staff, salaries andother operations. There is a risk ofthese systems failing or operating incorrectly due to malfunction, computer viruses, cyberattack, natural disasters or other incidents.

If any of these systems were to fail oroperate incorrectly due to malfunction, computer viruses, cyberattack,natural disasters or other incidents,
the provision of services to customers
and business partners may be interrupted, business processing may bedelayed, or operations could bethrown into confusion. There is also arisk of causing unintentional damage
to a third party.

Promotion of Group-wide security
measures, training and awareness-raising under the Information
Security Promotion Meeting

Degree of Impact
Potential for Control

Risks due to serious
incidents[Short-term]
Likelihood of
Occurrence
Degree of Impact[Short and Medium-term]
Likelihood of
Occurrence
Degree of Impact
Potential for Control

29 SBS GROUP Integrated report 2022

Periodic implementation of training toprepare for major disasters and otherincidents
Ensuring the earthquake resistance ofthe main buildings used for projects
Decentralization of major businesssites to the extent possible

Potential for Control

Risks due to system
shutdowns

Preparations and actions in
anticipation of legislative changes

Having employees thoroughly
implement infection prevention
measures consistent with government guidelines (temperature checks
when arriving at work, checking
health status, washing anddisinfecting hands, wearing masks)
Taking swift measures to prevent the
spread of infections when a person is
confirmed to be infected

Promotion of transportation safety
based on the three pillars ofeducation and awareness-raising,
accident prevent, and safe
driving/operation management

Strengthened defenses with AI-based
anti-virus tools and next-generation
firewalls
Enhanced monitoring and checking
functions through security operation
center (SOC) service
Third-party verification

Risks due to the leaking ofcustomer information[Short and Medium-term]
Likelihood of
Occurrence

Overview

EffectResponse Status

The businesses conducted by the
SBS Group involve handling large
amounts of customer information, including personal information, andthere are potential risks of the leakingof customer information or the destruction of data.

If an incident such as the leaking ofcustomer information or destructionof data were to occur, the trust
earned from customers could be lost,
and the incident could affect theGroup's business performance and financial situation.

Clearly establishment of the proper
management of customer informationin corporate ethics regulations

The SBS Group conducts its business activities based on laws related
to the logistics business and a wide
range of rules and social norms. Infringements of these requirements inany way could have a serious impact.

In the event of an infringement of related regulations or improper conduct
on the part of an officer or employee,
the SBS Group could suffer the lossof social credibility, suspension ofbusiness from customers, or claims
for costly monetary penalties or compensation.

Establishment of the SBS Group
Code of Behavior and SBS Group
Compliance Regulations

Degree of Impact

Continued implementation of
measures ensuring the proper
management of customer informationand personal information as part of
information security management

Potential for Control

Risks related tocompliance[Short and Medium-term]
Likelihood of Occurrence
Degree of Impact
Potential for Control

Conducting awareness-raising
activities, monitoring, confirming andinvestigating compliance violations
and driving improvements, primarily
through the SBS Group Compliance
Meeting in which Group companies
take part
Distribution of awareness-raisingtools and periodically conduct
awareness surveys

Risks related to overseas
expansion[Short and Medium-term]
Likelihood of
Occurrence*2

While the SBS Group has worked to
expand its business overseas toensure continued growth into the
future, those businesses are affectedby conditions in the countries and regions in which we operate.

There are possibilities of changing
economic conditions, recessions, exchange rate fluctuations, political or
legislative changes, and social unrest
due to terrorism, war or disease, in
addition to trouble stemming from ora lack of understanding of the local
culture or international standards, andmatters in conflict with international
norms, standards or guidelines.

Ongoing collection and analysis of
information concerning the countries
and regions in which we operate

The SBS Group recognizes the importance of human resources and focuses on hiring activities, educationand training, but there is intensecompetition to continually secure thenecessary human resources, andsuch efforts may not proceed asplanned.

If we are unable to secure human resources in a timely fashion, experience a large exodus of human resources to elsewhere or if the development of human resources does notproceed according to Group plans,
our business development, operating
results or growth forecasts could besignificantly impacted.

Proactively hiring talented humanresources without drawing
distinctions between graduate or
mid-career hires

Due to the advance of climatechange, the businesses of the SBSGroup could be affected by changes
to the environment or systems surrounding the market (transitional risks)or phenomena such as abnormal
weather and rising temperatures(physical risks).

The rising price of CO 2 emissions,costs to shift to low-emission technologies, the sharp rise in fuel energy
costs and similar developments leadto increased operating expendituresand put pressure on management. In
addition, abnormal weather events
could damage products and operating assets or reduce production capacity.

Promoting systematic businessstrategies and environmental
strategies based on a low-carbon
approach

Degree of Impact*2
Potential for Control

Risks related to theacquisition and developmentof human resources[Medium-term, Long-term]
Likelihood of Occurrence
Degree of Impact

Ensuring alternate means during an
emergency

Various training for all employees ofGroup companies based on the basic
policy on human resource
development Conducting training,supporting skill improvement andcareer development

Potential for Control

Risks associated withclimate change[Medium-term, Long-term]
Likelihood of
Occurrence
Degree of Impact
Potential for Control

Strengthening environmental
management systems
Stockpiling for emergencies
Enhanced disaster responsemanagement* See page 39 for details.

*2. The likelihood of occurrence and impact ratings have been increased by 1 each in light of multifaceted impacts associated with the situation in Ukraine.

SBS GROUP Integrated report 2022

30

Responding to the Effects of the COVID-19 Pandemic

Impact on the business environment due to COVID-19 andthe SBS Group's response
Continuing on from the previous fiscal year, in FY2021 the COVID-19 pandemic was a restricting factor on social and economic activity
in Japan and overseas. State of emergency (SOE) declarations issued by the national government for various locations in Japan continued
to change in terms of length and the regions affected, and as a result, our businesses were under state of emergency conditions for atleast seven months in total across two SOEs, from January 7 to March 18, and from April 23 to September 28.
Under this environment, logistics entered a new stage. Demand for intercompany logistics, which had been hit hard in the previous fiscal
year due to the pandemic, recovered both domestically and overseas as industry in general began to adapt to the new environment. In
addition, logistics demand for food, daily necessities and the various products handled by online shopping also continued to grow, in partdue to changing consumption styles.
Working under the COVID-19 Task Force and Basic COVID-19 Response Policy established during the first wave of COVID-19
infections, we have ensured thorough coordination of information within the Group, taken measures to prevent infections at each site,
responded quickly and accurately when infections have occurred, and continued to disclose information. These initiatives have formed thebasis for responding to new logistics demand in a way that places top priority on the safety and peace of mind of customers andemployees.
The Tokyo 2020 Olympic and Paralympic Games ended up being held under state of emergency conditions, but we maintained smoothbusiness operations by working to respond to the various policies and requests from the national government and local municipalities.

Framework Development
In connection with the emergence of COVID-19, the SBS Group
has set up a task force, formulated basic response policies, andmade efforts to conduct its business during the COVID-19 pandemic.
■ Our Changing Response

March 30, 2020 In response to the rise in infections (first wave), the
COVID-19 Task Force is launched
April 3, 2020
Basic COVID-19 Response Policy is formulatedApril 8, 2020
To coincide with the first state of emergency
declaration, we begin the introduction andoperation of the work system required to operate
under the COVID-19 pandemic such as at-home
work, distributed work and staggered shifts forsales and administrative department employees.
■ The taskforce plays a central role in coordinating information

The taskforce mainly comprises members of the Board of
Directors of SBS Holdings and the representatives of core SBSGroup companies, and is responsible for determining and approving
various measures while notifying and maintaining contact with SBSGroup companies.

taking measures to prevent infection, ensuring the infrastructure thatis essential for continuing with operations, cash flow measures), theBasic COVID-19 Response Policy was formulated and we have been
pursuing business activities based on this policy.
The SBS Group Basic COVID-19 Response Policy
1 The SBS Group's basic philosophy is to value employees●

Maintain the employment of staff●

Pay 100% of salaries during home furlough periods●

Ensure the health and safety of employees

2 Prevent infection clusters from forming within the Group●

General ban on face-to-face meetings●

General ban on business travel●

Requiring employees to report on their physical condition●

Appropriate measures when a person is infected

3 Continue current business operations with a focus on logistics●

Prompt resumption of operations after an infected person is
discovered (flexible support systems, advance preparations such astransferring some operations to other companies in the Group)●

Maintaining employee motivation (reaffirming the significance oflogistics as a part of social infrastructure, providing livelihood security

Taskforce

Notification andContact

to non-permanent employees)
Representatives of SBS Group Companies
and Risk Management Committee

Administrative Office(CSR Promotion Division)

Notification andContact●

Establishing and maintaining the minimum necessary chain ofcommand and management functions

4 Ensure basic infrastructureGroup Employees●

Ensuring a framework that can maintain the administrative operations●

Implementing measures in response to the situation (at-home work,that are essential for business continuity
distributed work, staggered shifts, etc.)

Fiscal 2021

5 Adequate cash flow measures

Taskforce Notices

Administrative Office Notices

5 times

12 times●

Implementing financial measures at each Group company such as
postponing non-urgent investments

6 Implement specific measures based on the above policy
7 Maintain lines of notification and communication within the Group

Information is also communicated to employees via email and theGroup's portal website.
As part of the Group wide policy that places an emphasis on
business continuity during the pandemic (maintaining employment,

31 SBS GROUP Integrated report 2022

Based on decisions and approvals from the SBS GroupCOVID-19 Taskforce, notices and communications related to thispolicy are issued and communicated by SBS Group company
representatives and the Risk Management Committee.

Measures to Prevent Infections
Based on the "list of reference materials to prevent COVID-19
infections and manage health in the workplace" released by the
Ministry of Health, Labour and Welfare, the SBS Group has instituted
key measures to prevent infection and provided guidance toemployees.
(1) Through implementation of infection prevention measures atworkplaces
Washing and disinfecting of hands
●

●

●

●

●

●

●

●

Wearing of masks, observance of coughing etiquette
Hygiene management and ventilation (ensuring distancing, regularventilation, measures in break rooms and changing rooms,
disinfecting areas touched by multiple people)
Health management (checking body temperature and physicalcondition, creating an environment that makes it easy for
employees to report feeling unwell)
Promoting work from home and staggered shifts (adjusting thepercentage of employees coming into work based on the spread of
infections)Utilizing online meetings, ensuring adequate distancing duringface-to-face meetings and discussions
Ban on non-essential outings and business travel (handled basedon the state of infections)
Ban on non-essential parties and dinners

Definitions Related to COVID-19 andAction to Take in the Event of Infection
The SBS Group formulated guidelines summarizing definitions
related to COVID-19 (affected persons, close contacts, persons
requiring observation) and action to take in the event of infection
based on guidance from the Ministry of Health, Labour and Welfare
and local governments, and rolled out the guidelines throughout theGroup.
While our basic policy is to always follow the guidance of local
health centers, when health centers are under strain and cannot be
contacted or when active epidemiological studies have been scaled
down, we make preparations to ensure accurate judgment andaction, including measures to quickly identify close contacts andpersons requiring observation and have them standby at home, andmaking sure that PCR tests and antigen testing kits are always
available at each location. In addition, while sets for performing initialdisinfection when infected persons are discovered have been
allocated to each business site, in anticipation of constraints onmarket supply, sets of disinfectant solution and protective equipment
have been stockpiled at four major locations throughout Japan as apart of a system to deliver needed supplies to business locations ineach region.

(2) Private activities
Moderation in behavior (wearing masks when going out, avoiding●●

dinners and parties, avoiding crowded situations, etc.)
Vaccinations (encouraging employees to get vaccinated)

Situation in the SBS Group Regarding Infections and Other Developments
Standards for announcing infections
When an infection occurs within the Group, the SBS Groupconsiders the need to protect the personal information and privacyof the people affected to prevent prejudice, discrimination anddamage to the reputation of business locations, and announces
information in the following way.
1. When it is determined that a cluster has formed and there is alarge impact on society
2. When an announcement is deemed necessary as a result ofconsultation with a customer (shipping consignor, etc.)

Cumulative figures starting from the first infection (as of June 30, 2022)
Infected Persons

Close Contacts

Persons Requiring
Observation

1,598

777

284

Details of announcement: The necessary information regarding
the infection person(s) and business locations is announced to theextent that the individual person(s) infected cannot be identified.

SBS GROUP Integrated report 2022

32

CSR Message & Key Topics

Through CSR that leverages our strengths as a logistics provider, we will contribute to the stability of daily live
and a sustainable society.

CSR Message
What does it mean to deliver goods?
To deliver goods is to connect goods with people
To connect goods with people is to link people's lives together, and to connect society
We will continue to deliver goods
To bring stability to people's lives and realize a sustainable society

In a degree of recognition for its efforts to date, SBS Holdings was made a
constituent stock of the FTSE Blossom Japan Sector Relative Index at the
beginning of April 2022.
The index was created by global index provider FTSE Russel, and is designed to
be a sector-neutral index reflecting the relative performance of Japanesecompanies that excel in responding to the environment, society and governance(ESG) in each sector. Additionally, to encourage the shift to a low-carbon
economy, for companies with particularly large greenhouse gas emissions, only
the companies evaluated for their improvement efforts according to the TPIManagement Quality Score are included.

TOPICS

The latest CSR topics (CSR news) are listed on the SBS Group website.
Top page → CSR Initiatives https://www.sbs-group.co.jp/sbsh/csr/

SBS Holdings
Fiscal 2021 SBS Group Safety Slogan is set● Number of business sites with G-Mark Certification increased to 169!
● SBS Group Awarded Eruboshi Certification for Promoting Women's
Participation and Advancement in the Workplace● SBS Group Vehicle Database System (commonly known as Sais)started operation● Conclusion of Official Partnership Agreement with Ricoh Black RamsTokyo●

SBS Ricoh Logistics
Took part in the KANSAI LOGIX 2021 logistics expo
Began operation of a trunk line network visualization system● Atsugi Baseball Club held classes for infants and early
elementary school students● Implemented forest volunteer and corporate forest activities● Received award for excellence in 2021 Eco-Driving Activity
Contest●●SBS Toshiba Logistics
SBS Group
Two SBS Group companies received the Logistics Optimization Effort
Award at the All Japan Logistics Improvement Case Conference● SBS Group Companies Awarded in Japan Packaging Contest 2021
● BUSINESS & CSR REPORT 2021 integrated report published● Adoption of Electric Trucks in Last Mile Logistics in Japan First●

33 SBS GROUP Integrated report 2022

Automation-promoting shelf-carrying robots began operation
Bulk image inspection system that improves productivity andquality was developed● Kansai Branch received 2021 Osaka City Environmental
Bureau Director's Award●●

SBS Flecnet
Second group of technical interns from Vietnam started working!
● Won a price for the first time in the female (truck girl) category at the 53rd
Truck Driver Context!
●

SBS Sokuhai Support
Launched a business matching service!
Obtained ISMS certification at six new business sites● Held the 1st Sales Driver Customer Service Manners
Contest●●SBS Freight Service●●

Local logistics in the Izu Peninsula posted to the company website
Received certificate of appreciation from TB Logistics Service

Marketing Partner●

Released Sustainability POCHI VISIONSSBS Logicom
Responded to the rapidly growing online shopping logistics needs under the
COVID-19 pandemic● Published issue 9 of the LOGILINK logistics PR magazine● Opened anti-flooding barrier-free trunk rooms following renovations● Released an introductory video for the iGOQ vehicle dispatch matching
service●

SBS GROUP Integrated report 2022

34

Environment

Environment
Major Indicators (Fiscal 2021 Results)
Number of employees taking
eco-driving and safe-driving training(cumulative total)

1,617
Total CO2 emissions(compared with the previous year)

3% increase

Number of eco-friendly
vehicles introduced(cumulative total)
From the following fiscal year, thiswill be reported as "Number ofnext-generation vehicles
introduced."

CO2 emissions per unit of sales(compared with the previous year)

30.77% decrease

For details about our basic policy on the environment and the structure for promoting
environmental initiatives, please check our website.
TOP → CSR Initiatives
https://www.sbs-group.co.jp/sbsh/csr/

35 SBS GROUP Integrated report 2022

Modal shifttransportation volume265,351t

Business sites whereenergy-saving lighting
has been introduced(cumulative total)

55

business sites

Environment Review of Fiscal 2021 Initiatives

In fiscal 2021, total CO2 emissions increased 3% year on year, inpart due to the addition of environmental data from SBS Toshiba
Logistics, which joined the SBS Group the year before. However,CO2 emissions per unit of sales, which indicates the environmental
efficiency of the entire SBS Group, declined 30.77% year on year,
enabling the Group to attain a higher level of environmental
efficiency.

In addition, we began a new span (Environmental Action 2023) of
the action plan under our Sincere Challenge 2030
medium-to-long-term environmental plan. Also note that starting
fiscal 2021 the SBS Group began to consider the specifics ofintroducing next-generation vehicles. As a first step in that effort, wehave been conducting demonstration testing of EV vehicles (1 ton)
for last mile delivery service.

Energy Usage and CO2 Emissions (Scope 1, Scope 2)

VehiclesFacilities
Electric PowerLight Oil

74,149,743 kWh

55,764 ℓ

LP GasType A Heavy Oil

65,447 m

Vehicle Fuel (light oil, CNG, LNG, gasoline)

73,033 ℓ

326,394,817 ℓ

City Gas

Running Water

349,546 m

151,070 ℓ

3Gasoline

11,537 ℓ
Vehicle Total

Facility Total

66,820 t / 1% increase

34,595 t 5.5% increase
Total Emissions

101,405 t 3.0% increase
Scope1

Scope2

Direct Emissions from Energy Sources

Indirect Emissions from Electric Power Purchasing, etc.

68,375 t 0.5% decrease

33,030 t 9.5% increase* Increase or decrease is in comparison to the previous year

Usage of Electric Power, Paper and Water (fiscal 2021)

Electric
Power
Usage

Paper
Usage

Water
Usage

74,149,000 kWh

89,880,000 pages

151,070 t

Specific Consumption

Specific Consumption

Specific Consumption

3,100 kWh

3,753 sheets

6.31 m(up 8.1% year on year)(up 4.1% year on year)(up 4.1% year on year)3* Specific consumption is per employee (fiscal 2021: 23,950 employees)

SBS GROUP Integrated report 2022

36

Environment Mid-to-Long-Term Environmental Plan

The SBS Group started its third mid-to-long-term environmental plan from fiscal 2018.

slogan, medium-to-long-term priority issues and a
medium-term action plan (Environmental Action 2023). We will

Dubbed “Sincere Challenge 2030,” the plan comprises awork on this plan in a sincere and proactive way.

SBS Group Mid-to-Long-Term Environmental Plan

Plan Name

Sincere Challenge 2030

Slogan“We take on the challenge of making an eco-friendly society full of green!”

Priority Issues

Mid-term

Curtailment of CO2 emissions (reduction of carbon emissions
from vehicles and facilities)
Promotion of resource recycling (effective use and recyclingof waste)
Conservation of natural resources (reduction of use of
copying paper and water)Long-term Strengthening reduction of CO2 emissions from vehicles(formulation and implementation of plan for introduction of
next-generation vehicles)
Strengthening Reduction of CO2 Emissions from Vehicles
If based on Japan’s nationally determined contributions in terms
for target energy-derived carbon dioxide emissions in each sector in
the Paris Agreement made at the Framework Convention on Climate
Change, 2030 energy-derived CO2 emissions in 2030 will need to bea 26% reduction from 2013 levels (24% reduction from 2005 levels,
corresponding to roughly 927,000,000 tons of CO 2 ), and in thetransportation sector, a reduction of 28% from 2013 levels (32%reduction from 2005 levels), or roughly 163,000,000 tons of CO 2.

37 SBS GROUP Integrated report 2022

To achieve these reductions by the year 2030, the SBS Groupcalculates it will need to replace at least 1,000 medium-sized
vehicles with next-generation vehicles (such as electric orhydrogen-powered vehicles). Moving forward, we will pay close
attention to national policies and the development trends ofautomotive manufacturers to formulate solid plans and find the righttime to introduce these vehicles.

Environment Action Plan

The SBS Group is implementing Environmental Action 2023 as
the action plan of the Sincere Challenge 2030 Mid-to-Long-Term
Environmental Plan. The plan sets six aims and 10 environmental
actions related to priority issues in the medium term, and defines
medium-term goals (currently covering fiscal 2021 to fiscal 2023) tobe achieved.
In fiscal 2021, we largely achieved our goals for CO2 emissions,amount of paper used for PPC, despite actively promoting paperlessmeetings in administrative settings, effective reduction measures
were not taken in operational settings, and the amount used has
increased as the size of the business has grown. Going forward, we
will reexamine measures with the aim of making fundamental
improvements. Moreover, since the goals set for these activities
were too far from reality, for the meanwhile we will change our action
plan with the goal of achieving reductions of "at least 1% year on
year."

mainly on a per-unit basis. However, regarding reductions in theEnvironmental Action 2023
Goal
Aim

2021

Preventing
globalwarmingResource
conservation[water andforests]

Resource
recycling

Developmentof greenlogistics
services

Education

Socialcontribution

Results

Achievement

Action
2022

2023

2020

2021

StatusReduction in CO2emissions per unit ofsales

At least 3% year-to-year

40.77 tons /100 million

28.23 tons /100 million

Reduction in CO2emissions per distancetraveled in vehicles

At least 1% year-to-year

0.50 kg/km

0.48 kg/km

4.21%
decrease

Reduction in water
usage peremployee

At least 1% year-to-year

6.32 m3

6.31 m3

0.21%
decrease

Reduction in PPC
paper usage per
employee

At least 1% year-to-year

3.598 sheets

3.753 sheets

4.28%
increase

Visualization ofindustrial waste
product recycling

Expansionofapplicablebusiness
sites

Sampling

Activepromotion

Under Consideration○
30.77%
decrease

○

△

△

△

Improved fuel efficiency

At least 1% year-to-year

5.01 km/ℓ

5.03 km/ℓ

Improvedeco-friendly vehicle
ownership rate*1-

92.45%-

Commendations
awarded to 6
business sites

Commendations
awarded to 4
business sites○

2,218 vehicles

Completedintroduction ofcargo vehicles○

Eco-driving
promotion

Development ofan evaluation andcommendation
systemLaunch of theevaluation andcommendation
systemFirm establishmentof the evaluationand commendation
systemYear-to-year increase in EMS introduction rate

0.4%
decrease

Raising awareness ofenvironmental action(putting up posters, etc.)

Active promotion

Sincere Challenge 2030 posters and"Environmental Actions Taken Within a
5-Meter Radius" posters weredisplayed.

○

Support forenvironmental groups

Providing support to at least one group

One environmental group was
supported and provided assistancewith its activities.

○*1 From the following fiscal year this will be set as "number of next-generation vehicles introduced"

SBS GROUP Integrated report 2022

38

Environment Climate Change Risks and Countermeasures

The SBS Group recognizes risks due to climate change asimportant management challenges. As an enterprise responsible forpart of social infrastructure, risks due to climate change are an issue
that cannot be ignored. To achieve sustainable management, we
believe it is necessary to appropriately ascertain and manage theserisks, and to respond and adapt to them as appropriate.

■

Risks Due to Physical Impact

To the SBS Group, which maintains many business sites aroundports and harbors, disasters caused by weather phenomena
believed to be affected by global warming, including typhoons ofincreased severity, storm surges and frequent torrential rains, poserisks to business continuity. To address these risks, we consider site
conditions and facility design with flood damage in mind whenestablishing new logistics sites, and have prepared for emergencies
with the creation of the SBS Group Business Continuity Plan, whichsets out the measures to be taken in the event of a disaster.
Additionally, with rising temperatures in recent years, workers face asignificantly heightened risk of heat stroke. To the SBS Group as an
employer of large numbers of drivers and warehouse personnel,risks to employee health represent a serious issue. We will takemultifaceted measures to deal with these risks, including the
installation of additional water supply equipment, the regular
stocking of supplies, the provision of goods to help workers copewith the heat, careful monitoring of high-temperature warning
information, and efforts to alert workers to the dangers.

■

Risks Due to Regulations

The strengthening of regulations based on international
agreements such as the United Nations Framework Convention on
Climate Change (Paris Agreement) could be a risk that placespressure on management costs. There is a possibility of new
regulations and systems (carbon taxes, taxes on fuel and energy
consumption, etc.) being advanced. For the SBS Group as atransportation business operator, for example, we may be pressured
to upgrade our vehicle fleet to next-generation vehicles and switch tomore energy-saving facilities at an early stage. To address theserisks, we will pay close attention to national policies while developing
steady plans and make preparations so that we can swiftly invest in
vehicles and equipment when the time comes.
SBS Group Business Continuity Plan
This is a plan to ensure business continuity in the event of a major disaster and isprepared in according with the SBS Group basic policy on business continuity
planning. The plan gives top priority to safeguarding people’s lives.

United Nations Framework Convention on Climate ChangeThis convention sets out an international framework to prevent the various adverse
effects that are caused by global warming, with the ultimate aim of stabilizing theconcentration of greenhouse gases in the atmosphere. The Paris Agreement (2015)
was adopted as a new international framework that includes greenhouse gas
emissions reductions for the year 2020 onwards.

The SBS Group’s Climate Change Risks and Countermeasures
Type

Cause

Details

EffectDetailed Effects

Countermeasures

Rising greenhouse gas
emissions prices

Strengthening of domestic
environmental
regulations
due to international agreements (carbon taxes, taxes
on fuel and energy consumption, emissions trading)

Increased business expenditures (rising costs to comply
with laws and regulations,rising insurance premiums)

Pressure on management due to business expenditures / pressure on management due torising environmental investment costs (higher
expenditures due to the decarbonization of vehicles and other equipment) / rising costs andlower revenues associated with stronger CSR
procurement on the part of customers

Formulating and executing systematic business strategies (andenvironmental strategies) basedon a low-carbon approach

Costs to transition to
low emissions technologies

Pressure on management
due to increased environmental investment costs

Increased time and costs
spent adopting and deploying new activities and processes

Higher expenditures due to the decarbonizationof vehicles and other equipment / introduction of
next-generation vehicles / introduction of energy-saving measures / introduction of other environmental conservation measures / usage andcreation of renewable energy

Formulation and execution ofsystematic business strategies(and environmental strategies)

Changes in the market
environment

Market stoppages or the cutting off of import/export
routes due to disasters or
conflicts caused by global
warming

Sudden and unpredictablefluctuations in energy costs
and energy shortages

Pressure on management or reduced production capacity from sharply rising fuel and energy
costs and supply shortages causing increased
expenditures

Increased installation and upkeepof in-tanks to prepare for emergencies / In addition to theabove, supplementary measures
such as providing fuel supply services during disasters will betaken

Damage to reputation
due to delays in environmental measures under
decarbonization trends
against the backdrop ofinternational agreements
and other developments

Rise in stakeholder concernsor feedback from negative
stakeholders

Damage to public trust arising from breaches of stakeholder trust

Falling share prices / reduced competitiveness /personnel exodus

Enhanced environmental management structure (environmental initiatives, information disclosure, etc.)

Other impacts due toclimate change

Risk of customer difficulties
with operations or business
continuity from the effects ofclimate change causing lower
revenue for the SBS Group

Decline in order amounts andlosses due to changes to theoperational status of customers

Reduced revenue and lost orders due to worsening financial conditions for customers

Ascertaining market conditions
and strengthening CSR management

Increased severity ofabnormal weather phenomena including cyclones and flooding

Increasingly frequent weather-related disasters including
typhoons of increasing severity, frequent torrential rain,
heavy snowfall and so on

Direct damage to facilities
and adverse impact on production capacity and workforce

Compensation for loss of product value due todamage to customer products or flooding, etc.
/ losses due to direct damage to businessassets (business facilities, vehicles, etc.) / accidents suffered by employees while commuting
or at work / reduced production capacity due
to difficulties securing operational personnel or
disruptions to vehicle operations

Strengthening of risk countermeasures (hazard management
at sites and the associated responses) and disaster responsemanagement

Adverse impacts on thehealth of employees and reduced production capacity
due to rising temperatures

Lower sales and rising costs
due to the adverse impacts
on the workforce (Examples:
health, safety and absenteeism)

Workforce reductions due to employee healthhazards such as heat stroke / increased installation of air conditioning in warehouses and facility/equipment investments to combat rising truck
cabin and body temperatures / compensation
for loss of product value for refrigerated orfrozen goods / facility investment to maintainquality to prevent accidents involving products

Implementation of measures, including, careful monitoring of related information and warnings
to workers / increased installation of air conditionings andwater supply equipment, regular
stocking of supplies, provision of
goods to cope with the heat / facility and equipment investment
to curb in-vehicle temperatures

Transition

Physical Rising mean temperatures

39 SBS GROUP Integrated report 2022

Environment Climate Change Risks and Response Measures / The SBS Group's CO2 Reduction Measures■

Responding to the Taskforce on Climate-related
Financial Disclosures (TCFD)

As a part of its ESG information disclosures, SBS Holdings willdevelop climate change-related information disclosures based on
the TCFD recommendations.
●●

Declaration of support for TCFD: during 2022
Start of information disclosures based on the TCFD
recommendations: 2023 onward

To mitigate climate change, we will engage in multifaceted efforts
focusing on vehicles and facilities, which are major sources of CO 2
emissions but which can also create energy with innovative
approaches.

■

Modal Shift

The SBS Group also supports modal shift. Modal shift refers tosocial contribution-oriented modes of transportation that not only
reduce the impact on the environment but also address the shortageof drivers. In 2015, SBS Logicom Co. Ltd. participated in promoting
the model shift of sales routes for liquor dealers and helped
significantly reduce CO 2 emissions as a result. The company
received a joint award under the Excellent Green Logistics
Commendation Program.
Companies targeted for modal shift(SBS Toshiba Logistics / SBS Ricoh Logistics / SBS Logicom)
Modal shift is to shift the means of transportation for cargo and people, and in cargotransportation, it means the movement of goods by cargo truck is switched to rail orcoastal vessel-based transportation. Since attention was drawn to modal shift at the■Initiatives Related to Vehicles

1 Eco-driving
The SBS Group is striving to foster a deeper culture of eco-driving
through eco-driving (fuel-efficient driving) training (eco andsafe-driving training: eco-driving workshops conducted in groupsettings) and through actual practice (voluntary fuel efficiency
management: having drivers ascertain the effects of their own drivingby recording supplied fuel, distances driven and fuel efficiency byhand to raise awareness of fuel-efficient driving) in a two-pronged
effort.

3rd Conference of the Parties under the United Nations Framework Convention on
Climate Change (Kyoto Meeting) in 1997, various countries have pursued initiatives,and efforts have also been promoted by Japan’s Ministry of Land, Infrastructure,
Transport and Tourism.

■

Preventing Air Pollution

Harmful air pollutants emitted from vehicles are continually
measured and managed. In recent years we have continued to
update our vehicles and these emissions have been decreasing
with each year.

2 Introduction of next-generation vehicles
With options for cargo vehicles extremely limited at the moment,
we have begun practical verification tests aimed at the practical useof EVs for last mile delivery service. SBS Group is planning to
replace approximately 2,000 vehicles that are operating as
e-commerce vehicles in last mile logistics with electric vehicles in the
coming five years or so, and to adopt approximately 10,000 electricvehicles over the medium term as vehicles of partner companies as
well.

■

Initiatives Related to Facilities

The SBS Group is promoting energy savings at its facilities
through a range of energy conservation measures including the
introduction of energy-saving lighting (LED, electrodeless lamps,etc.), primarily at existing large-scale centers and new centers.
Energy-saving lighting has now been introduced at 55 businesssites, and the effects of doing so have been visualized. We willcontinue to actively promote these activities.

■

Creation of Renewable Energy

The SBS Group maintains solar power generating equipment(total generating capacity of approx. 13megawatts) at 16 locations(facility rooftops and dedicated installations), contributing to thecreation of renewable energy. Although on-site use accounts for only
several percent of total generation, in the future we plan to shift toon-site use.

2019

2020

2021

Nox (unit: kg)

141,085

138,977

104,815

Year-on-year decline (%)-10.93%-1.49%-24.58%

Usage / Fiscal YearPM (unit: kg)

3.729

3,458

2,587

Year-on-year decline (%)-11.72%-7.27%-25.19%

16

Solar
power
generating
equipment

locations

Number of employees
taking eco-driving andsafe-driving training

13

Total
power
Approx.
generating
capacity

mega
watts

1,617

(as of December 31, 2021)

Number of businesssites whereenergy-saving lighting
has been introduced

55

business sites(cumulative total including sites with partial introduction)

Modal shifttransportation volume(fiscal 2021)

265,351t(fiscal 2021)
Rail cargo: 242,610 t, ship cargo: 22,740 t

SBS GROUP Integrated report 2022

40

Safety & Social

Safety & Social
Key Indicators [Safety] (Fiscal 2021 Results)
Number ofTransportation Safety
Promotion Meetings Held

4

times

Number of Group
Safety Training
Sessions Conducted

37

times

For details about our basic policy and promotion system
regarding safety, please check our website.
TOP → CSR Initiatives
https://www.sbs-group.co.jp/sbsh/csr/

41 SBS GROUP Integrated report 2022

Group-Average
Fuel Efficiency

5.03

km/ℓ

\Number of Business Sites with
G-Mark Certification (certification
rate)

169

business sites (89.4%)

Safety & Social Review of Fiscal 2021 Initiatives [Safety]

In fiscal 2021, as usual we identified points of improvement in termsof safety and reflected them in operation and management work,
took measures against health-related incidents (SAS measures,
prevention of overwork, heat stroke, etc.) and the prevention of truck

and forklift accidents (analysis and training) as priority issues, andpromoted operational safety management. We are also pleased toreport zero serious accidents throughout the SBS Group.

Priority Risks
Strengthening employee health management, reducing major accidents, strengthening fire prevention measures at logistics facilities

Priority Issues
Improving fuel efficiency through eco-driving training and enhancing awareness of safe driving
Preventing accidents by conducting safe operational training for trucks and forklifts
Skill improvement initiatives to foster the development of operational managers, health officers and other key personnel

SBS Group Transportation Safety Management
Risk Management

Policies and Priority Issues

Transportation Safety Promotion Meeting

Education and Awareness-RaisingGroup Safety Education●

Operation manager examination preparatory
seminars

Accident Prevention

Accident factor analysis

Roll calls and alcohol checks

Near miss incident information collection
and dashcam video analysis

Regular inspections●

Operational manager basic classes●

Operational manager general classes

Risk prediction training

Health officer examination preparatory
seminars

Aptitude diagnosis●●

Regular first-aid classes●

Eco-driving courses●

Eco and safe-driving training●

Truck safe driving training●

Forklift safe operation training●

Forklift operator contests●

Truck driver contests

Safe Driving and Safe Operation
Management

Regular SAS screening examinations andhealth checkups
Stress checks / consultations with industrial
physicians
Training for persons causing accidents

Call for proposed safety slogans

Introduction of vehicles equipped with safety
features (collision avoidance, reduced
braking, road deviation prevention)

Affixing of eco and safe driving vehicle stickers

Blood pressure measurements
Heat stroke countermeasures

Fitting of driving support equipment(digital tachograph, dashcam, rear-view
camera)Business audits, touring follow-ups,business site self-inspections
Acquiring certification (G-mark) as abusiness site with excellent safety
Truck driver / forklift operator contests
Occupational health and safety movement
Safe operation award
Logistics facilities fire prevention measures
Eco and safe-driving evaluation andcommendation system

SBS GROUP Integrated report 2022

42

Safety & Social Education and Awareness-Raising, Accident Prevention■

Group Safety Education■

Regular determinations made by operational managers are
extremely important in minimizing the risks of serious accidents andother risks. The SBS Group focuses on cultivating and improving theskills of operation managers and strives to raise the level oftransportation safety management capabilities across the Group. In
fiscal 2021 we resumed several training sessions that had been
postponed due to the COVID-19 pandemic.

Standardization of
Operational Management

The SBS Group, which is made up ofmultiple logistics companies, has preparedan operational management manual (inbooklet and video form) that is common to
the Group and makes efforts to standardize
the knowledge and business operations ofoperational managers, maintenancemanagers and crew.
■

Safety Slogan

Each year the SBS Group accepts proposals from employees fora safety slogan to be used in Group-wide awareness-raising
activities to foster pride as professionals with responsibility for safety.
For fiscal 2022, one entry each was selected for the traffic safetyslogan and business site safety slogan.

Fiscal 2022 Traffic Safety Slogan

Drive with a broad mind
and wide field of vision

SBS Group Safety Education Curriculum Implementation
Status for 2021
Number of
Sessions
Held

Curriculum

Number ofTrainees

Operation manager examination preparatory seminars

12

229

Operational manager basic classes

12

180

Operational manager general classes

4

120

Health officer examination preparatory seminars

1

65

Regular first-aid classes

230

Eco-driving courses

1

23

Eco and safe-driving training

1

24

Truck safe driving training

1

26

Forklift safe operation training

2

45

Forklift operator contests

Cancelled-

Truck driver contests

Cancelled-

Meetings

Number ofTrainees■

36

Tomoya Nomura, Kodaira Sales Office, SBS Zentsu Co., Ltd.

Fiscal 2022 Business Site Safety Slogan

Preconceptions, carelessness andimpatience cause accidents
Isao Kihara, Matsuyama Center, Hinomaru Kyuso Co., Ltd.

■

Affixing of Eco and Safe Driving Vehicle Stickers

Since December 2017, this sticker has been affixed to all SBSGroup cargo vehicles. The sticker represents our promise to societythat SBS Group vehicles take the environment and safety into
consideration. We are conscious of being eco-friendly and safe
drivers, and are committed to eco and safe driving.

742

Driver Health Management

The SBS Group not only takes steps to prevent overwork but also
makes thorough efforts to regularly conduct health checkups andperform SAS (sleep apnea syndrome) screenings to prevent
accidents attributable to employee health. SAS screening tests not
only involve secondary screening but also regular monitoring after
testing. Additionally, since there has also been an uptick in accidents
related to brain disorders across society in recent years, we
continually monitor the state of health of drivers by conducting brain
MRI scans as necessary in order to ensure safety and peace of mindin our transportation operations.

43 SBS GROUP Integrated report 2022■

Employee Health Management

In light of recent rising temperatures, since fiscal 2018 the SBSGroup has stepped up measures to combat heat stroke in its
warehouses. We have thoroughly investigated information related toincidences of heat stroke and installed additional air conditioning
equipment to enable proper temperature management within
warehouse facilities. In addition, we actively advise drivers to run air
conditioning continuously. As a result, we have managed to reduceincidences of heat stroke. We will continue to address this issue withthe aim of completely eliminating cases of heat stroke among our
employees.

Safety & Social Safe Driving Management■

Truck Driver / Forklift Operator Contests

We have been holding contests since fiscal 2016 with the aim ofhaving drivers and operators compete over their knowledge ofadvanced driving skills, inspection technologies and related laws andregulations, and hone skills through friendly competition. In addition,
the contests aim to raise awareness of their social responsibilities asdrivers and operators by acting as exemplary representatives of theirrespective workplaces. Each contest will improve the awareness andskills of individual drivers and cultivate a Group identity that pursues
safe driving and operation.

■

Fitting of Driving Support Equipment

All cargo vehicles operated by the SBS Group are fitted withdigital tachographs. These devices not only ensure compliance withspeed limits but also record, evaluate and analyze a range of
information including sudden accelerations and decelerations, theopening and closing of doors, and idling information. This is used toprevent accidents, improve mileage and raise awareness about safe
driving. In addition, all vehicles are equipped with dash cams, andwe make every effort to improve safe driving habits by monitoring
driving conditions. New vehicles are also equipped with rearcameras and collision avoidance support systems to prevent
collisions when reversing. Going forward, the SBS Group willcontinue to enhance support for the safety of crew members.
■

Fire Prevention Measures at Logistics Facilities

The SBS Group has created its own prevention measures checksheet based on guidelines from the Ministry of Land, Infrastructure,
Transport and Tourism and the Fire and Disaster Management
Agency. All Group logistics facilities are required to perform periodic
checks and report on the results. Criteria have been established forthe items to be checked, and when the criteria are not met, facilities
are obligated to take corrective action. We strive to raise the level offire prevention methods by iterating on this cycle of checks andimprovements.
■

The FY2021 Truck Driver Contest and Forklift Operator Contest
were postponed due to the COVID-19 pandemic.
■

Raising Awareness of Accident Prevention and
SafetyThe SBS Group creates and displays various posters as part ofefforts to prevent vehicles and occupational accidents, and to raiseawareness about safety.

Eco and Safe-Driving Evaluation andCommendation System

We implement an Eco and Safe-Driving Evaluation andCommendation System with the aim of achieving transportation
safety and appropriate business operation by widely disseminating
eco and safe-driving awareness and skills among SBS Group
companies. The system awards commendations to business sitesthat have achieved excellent results in eco and safe-driving (basedon evaluation items including fuel efficiency improvement ratecompared with the previous year, and the implementation status ofsafe driving management and safety education). The SBS Group
strives to improve quality in both environmental and safety terms
through this system.

Business Sites Awarded Eco and Safe-Driving Evaluation
and Commendations in FY2021
Company Name

Branch NameSBS San-ai Logistics Co., Ltd.

Tohoku Office, Southern Tohoku
Branch, East Japan Branch
OfficeSBS Logicom Kanto Co., Ltd.

Keiyo Branch

SBS FlecNet Co., Ltd.

Nagoya Sales Office

SBS Zentsu Co., Ltd.

Kaihin Office, Chiba Delivery
Section, No. 2 Delivery
Department

SBS GROUP Integrated report 2022

44

Safety & Social Engagement Between the SBS Group and Society, Engagement with Customers, Engagement with Employees

The SBS Group undertakes its corporate activities with the
involvement of various stakeholders.
The SBS Group regards the customers to whom it provides
services, as well as shareholders and investors, the employees
who work together with the Group, business partners including
suppliers and contractors and the local communities where theGroup does business as major stakeholders.
To stakeholders, we commit to putting the customer first,■

Quality Management System

Each Group company in the SBS Group has established a quality
management system and we endeavor to maintain and improve thequality of the transportation and services we provide. In addition to
the international ISO9001 standard that indicates systematic
requirements for quality management systems, we have also
obtained other appropriate certifications including ISO27001
certification for information security management systems, thePrivacy Mark related to the protection of personal information, as
well as JAS Organic Agricultural Product Subdivider Certification andthe Relocation Safety Mark.
* See the CSR data on page 64 for more information on certification status.

■

Implementation of Improvement Activities

The SBS Group conducts a wide range of improvement activities
and holds an Improvement Contest designed to recognize
achievements in those endeavors and share outstanding expertise.
For its part, SBS Ricoh Logistics System holds a Global KAIZEN
Contest under the themes of KAIZEN and Reform incorporating
management issues. Meanwhile at SBS Zentsu, the Home Delivery
Division responsible for the delivery of foods at the four temperature
ranges holds Improvement Example Presentations to develop a
comfortable workplace environment, and has workers compete and■Respect for Human Rights and Eradicating
Power Harassment

To coincide with the enactment of power harassment prevention
legislation, the SBS Group established a Declaration on Respectfor Human Rights and the Eradication of Harassment. In our management philosophy, we at the SBS Group state the belief that"long-term prosperity is rooted in paying the necessary attention topeople and in the enthusiasm of our employees." In keeping with thisbelief, we will make every effort to respect human rights and prevent
harassment.

making appropriate information disclosures, developing a
comfortable workplace, cultivating partnerships andcontributing to local communities, and we endeavor to reflect
these commitments in our corporate activities throughwide-ranging dialogue with stakeholders. We have establisheda Code of Behavior prescribing compliance with laws, manners
and morals, environmental conservation and social contribution
as a corporate citizen, and strive to coexist with society.

learn home delivery customer service skills through the “Customer
Service Master Contest.” SBS Flecnet holds Business Improvement
Presentations with the aim of providing better services anddeveloping an improved work environment. Each of these initiatives
is not only an opportunity to raise awareness of issues and sharelessons, but is also positioned as an opportunity to develop a
positive corporate culture.
■

Provision of Information

In addition to disclosing information about the business
operations it is entrusted with, the SBS Group earns the trust of
stakeholders by providing a range of information with a focus on
customers.
The LOGILINK, a logistics-oriented PR publication issued by SBS
Logicom for customers, has earned a favorable reception among
companies, groups and government organizations as a medium fordisseminating useful information to those responsible for andinvolved with logistics, including case studies of logistics solutions
and the latest information. Everything from the expertise andfunctions of SBS Logicom logistics services to the ingenuity of its
staff is introduced in an easily understood format that illustrates SBS
Logicom’s collective strength as a logistics company.

SBS Group Declaration on Respect for Human Rights
and Elimination of Harassment
All people are born equal with dignity and rights, and no one
may harm their character.
Based on this basic philosophy, we deepen our understandingof human rights and act in accordance with a respect forhuman rights.
To maintain a workplace environment in which everyone canthrive, we will eradicate harassment.
To achieve this, we will actively take part in educational andawareness-raising activities, heed compliance information,acquire knowledge and develop the ability to take action.
Whenever we suffer or witness harassment, we will consult
with or report it to a consultation service and never leave it
unaddressed.

45 SBS GROUP Integrated report 2022

Safety & Social Engagement with Employees, Engagement with Business Partners, Communication with Stakeholders■

Diversity

The SBS Group ranks the promotion of diversity among its key
issues in the medium term and is working on the following issues.
1. Cultivating a workplace environment that considers individual
differences to be something of value

The services provided by the SBS Group are supported throughthe cooperation of many business partners. We regard our business
partners as fellow entities executing business goals in tandem with
the SBS Group. Accordingly, we endeavor to fulfill our obligations
and develop in step with these business partners, in keeping withlaws and ethics.

2. Conducting diversity & inclusion training andawareness-raising to eliminate prejudice
3. Enhancing organizational strength through the proactive
hiring of a diverse range of human resources
4. Establishment and enhancement of support for minorities

The SBS Group strives to engage in dialogue as well as discloseand provide information by developing and utilizing means ofcommunication with various stakeholders.

5. Development of a workplace environment enabling all
employees to maintain a healthy work-life balanceCommunication with Employees■

Development of Telework and Work-From-Home
Systems

In response to measures addressing the recent COVID-19
pandemic, telework and work-from-home systems were developed(drawing up of rules and practical development of various functions)for the administrative divisions. The SBS Group will ensure that newstyles of working can take root and work to promote a healthy
work-life balance while strengthening business continuity functions.
■Publication of the SBS
Express Group magazine

Compliance Training Tools

The SBS Group provides wide-ranging education and training to
all employees working at Group companies in accordance with thefollowing Basic Policy on Human Resource Development.
1.We will implement human resource development as a part ofour management strategy and human resource strategy, andfoster human resources able to contribute to the growth anddevelopment of the Group
2. We will cultivate human resources through a broad range ofeducation and training, and strive to build up the Group’s
personnel-based assets

times

times

* Individual educational tools for divisions
and business sites

Communication with Shareholders and Investors
Total Financial Results
Briefing Attendees

Human Resource Development

47

Responses toInvestors and Analysts

173
131

(twice a year)/ yearMedia Communication

Press Releases Issued

Web Information

3. We will assist employees in achieving their self-actualization
goals through life-long education73
7

Website Communication
The composition of training is systematically organized into tiered
training, specialized theme-specific training, department-specifictraining and personal development support, and is designed to help
employees improve their skills and develop their careers.
* See the CSR data on pages 64 for a breakdown of the curricula.
■

Number of Visitors(1,183,665)

Page Views

Developing a Pleasant Workplace

The SBS is committed to developing a workplace in whichanyone can work with peace of mind and demonstrate theircapabilities based on the promotion of diversity and workstylereforms.

Eruboshi Certification for Promoting
Women's Participation andAdvancement in the Workplace* SBS Holdings

Kurumin Certification forcompanies offering childcare
support to employees* SBS Holdings

3,639,514
14,784,487

PV(6,259,040) * Figures in parentheses are for SBS Holdings, Inc.

Certification System for Pleasant Workplace
Development (Automotive Transport Business
Operators)* SBS Ricoh Logistics, SBS Zentsu

SBS GROUP Integrated report 2022

46

Safety & Social Social Contribution Activities■

Food Bank Support Through the Provision of
SBS Group Resources

The SBS Group began food bank support activities in 2018. A
food bank is an activity or organization that collects from corporates
and other organizations food that has not yet expired but cannot besold for various reasons and distributes it to people in need (people
in distress).
We support Certified NPO Organization Second Harvest Japan(2HJ), the largest food bank in Japan which is based in
Asakusabashi, Tokyo. We were looking for ways to contribute tosociety through logistics, and 2HJ's needs for logistics support
coincided with our capabilities, leading to the conclusion of a
support agreement. We provide support in two main ways, firstly
providing the temporary transportation of goods between fooddonors and 2HJ sites, and secondly providing advice andrecommendations on warehouse management and vehicle
operation.
For the temporary transportation of goods, 2HJ usually uses its
own vehicles to pick up donated foodstuffs (at the request of
manufacturers, etc.), but when there is no way to secure a vehicle ormanpower, such as when there are no available vehicles or drivers(who are all volunteers), an SBS vehicle can be used as analternative transportation service. On rare occasions when the 2HJ
warehouse is full, we receive requests to store supplies and respondas needed.

The food bank support is a very meaningful initiative that not only
contributes to strengthening the food lifeline for people in need, butalso contributes to the reduction of food loss, which is a recentsocial problem. In the future, we will continue to work together with
2HJ to create a society where people have a place they can turn towhen they encounter difficulties with food.

Manufacturers

Importers andWholesalers

Retail Outlets

Regular Companies

Donations

Food Bank

Orphanages
WelfareFacilities

Local Public
Entities
Social Welfare
Councils

NPO
Local Food Bank
Organizations
Organizations

IndividualHouseholds

Food Bank Support Results (Transportation and Storage)

Number ofTimes Support
Was Provided

18

Major Support Initiatives in Fiscal 2021 (Storage)
times(Since 2018 launch to 2021 present)

Cup noodles

1080 cases, 36 pallets

Canned soup stock2500 cases, 29 pallets

Packaged cooked rice

768 cases, 16 pallets

Mayonnaise

3584 cases, 45 pallets

Oatmeal32 cases, 32 pallets

Canned fruit

562 cases, 11 pallets

The SBS Group's Major Social Contribution Initiatives
Type

Nature of Support and Recipients

Support for food banks
Coordination (Certified NPO Organization, Second Harvest Japan)
with theSocial Sector* Support for environmental conservation activities(Public Interest Incorporated Foundation, OISCA)

Contributing
to the local
community

Social contribution-oriented sales drives(Sumida Ward Welfare Workplace Network <kai>)Donation of used stamps(Sumida Ward Council of Social Welfare)Collection of toothbrushes<Toothbrush Collection Program>(LION / TerraCycle Japan G.K.)

Others(Collection ofused items, etc.)

Collection of school backpacks<Randoseru for Life Collection>(NPO, International Consulting Association)

Details of Support
Transportation support connecting companies that wish to donate food to
Second Harvest Japan (2HJ) with 2HJ logistics sites. In addition, advice andproposals on warehouse management and vehicle operation are also provided.

Implemented at therequest of 2HJ

Sponsoring and support activities (participation in forest conservation activities,
donations of collected items such as used books, CDs and DVDs)

Collected items are
accepted at any time

We sell sweets and bread made at about 20 welfare workplaces in Sumida
Ward (where people with disabilities are involved in the work).

2 to 3 times / year
OlinasProceeds (stamps are purchased by a stamp company) are used for social
welfare projects in Sumida Ward

Accepted at any time

This initiative collects used toothbrushes and recycles them into new plastic
products, such as flower pots. The program aims to reduce plastic waste andpromotes the use of recycled resources.

Accepted at any time

An initiative to send "randoseru" school backpacks to children in Afghanistan
who still lack educational opportunities due to the civil war and other factors.
This is recognized as supporting the empowerment of girls in their schooling,
especially because of the lack of cultural understanding female education.
(As the support has spread, the "randoseru" backpacks have become asymbol of education in Afghanistan.)

Accepted at any time

* In addition to the activities listed above, individual SBS Group companies also undertake various social contribution activities.

47 SBS GROUP Integrated report 2022

Reception /Implementation■Endowed Course at the University of Tokyo■SBS Kamata Foundation

The SBS Kamata Foundation is a support foundation thatprovides grants for excellent logistics research and offers
scholarships to students receiving social care.

Together with Yamato Holdings Co., Ltd. and Suzuyo & Co., Ltd.,SBS Holdings Co., Ltd. has established the Endowed Research
Department for Advanced Logistics Science at the Research Center
for Advanced Science and Technology, the University of Tokyo, andfrom April 2020, began offering lectures for graduate students of theuniversity's School of Engineering. The course aims to develop
high-level logistics human resources who can use advanced scienceand technology to transform logistics, to solve issues faced bylogistics companies, and to contribute to the development of theJapanese economy.

SBS Kamata Foundation Website (https://www.sbs-kamatazaidan.or.jp/)

Logistics Research Grants

Scholarships for Students Receiving Social Care

The foundation conducts aid activities with the aim of supporting
academic research into logistics, which is part of the social
infrastructure, and contributing to the development of the industry as
a whole and the betterment of people’s lives, for instance by using
the fruits of research to improvelogistics efficiency and prevent
Grants Issued
accidents.

This project provides scholarship funding to motivated and talented students and other persons to prevent them from abandoning
education for economic reasons, with the aim of contributing toequal opportunity in education and the development of humanresources, while helping
enhance education and Number of Scholarship
Recipients inwelfare.

Applicable Research: (1) academic research and (2) the holding ofresearch workshops, symposiums, seminars, etc.
that contribute to the promotion or developmentof logistics are eligible.

Application Requirements: Students who are generally at least 18 years
old and have been accepted for enrollment
into higher education, who are children
residing in a child welfare home or living in a
foster home in the Kanto region, and whoplan to advance to university, junior college,
a vocational school or similar
Scholarship Amounts:
300,000 yen per student (as a higher
education allowance)

4in Fiscal 2021

Fiscal 2021

* Examples of the themes addressed : improving logistics efficiency, improving safety incargo transportation and reducing the impact on the global environment (reducing CO2
emissions) through better logistics systems
Grant Amounts: Total of 3,000,000 yen, up to 500,000 yen per individual grant.

76

Results of Issued Grants and Awarded Scholarships
2015

2016

2017

2018

2019

2020

2021

Logistics research grants

6

7

7

9

6

6

4

Number of scholarships granted (number of recipients)

-

-

30

34

57

74

76

Results of Logistics Research Adopted in Fiscal 2021
Name of Affiliate Organization

Position

Name

Research Subject

Grant Amount(thousand yen)

Nihon University College ofCommerce

Associate
Professor

Takuya Akikawa

Survey of young women's perceptions of employment
in the logistics industry

500

Faculty of Education, Gifu
University

Assistant
Professor

Shumpei Harada

Study on the possibilities of freight and passenger
consolidation as a measures for persons with limited
opportunities for shopping.

500

Academic Research Institute,Tokyo University of Marine
Science and Technology

Associate
Professor

Toshimasa AsouWork instruction support systems at logistics facilities

500

Graduate School of Informatics
and Engineering, The University
of Electro-Communications

Associate
Professor

Dairoku Muramatsu

Development of a passive-type intra-bodycommunication-based picking system to improve theefficiency of logistics work

500

SBS GROUP Integrated report 2022

48

Governance

Governance
Major Indicators (Fiscal 2021 Results)

Outside Directors

5(out of 12 directors)

Board of Directors meeting attendance rateby outside directors
All
Directors:

98%

OutsideDirectors:

97%

Audit & Supervisory
Committee meeting
attendance rate

97%

Basic Approach
As the holding company of the SBS Group, SBS Holdings ("the Company") ensures theefficiency, soundness and transparency of overall SBS Group management. Additionally, tocontinually enhance corporate value and become a company that earns the trust of society,
the Company promotes compliance and risk management Group-wide.
At the Board of Directors meeting held in December 2020, the Board resolved to shift to thestructure of a company with an Audit & Supervisory Committee. The resolution was approvedat the Ordinary General Meeting of Shareholders held in March 2021. The purpose of the shift
to this structure is twofold, as described below.
(1) Enhancing management transparency
Audit & Supervisory Committee members responsible for auditing and otherwise
overseeing directors in the execution of their duties having voting rights on the Board of
Directors enhances its monitoring function and further improves managementtransparency.
(2) Speeding up decision making
The provisions of the Articles of Incorporation make it possible to delegate decisions
regarding the execution of important business to directors, and directors can makedecisions on the execution of business without requiring resolution by the Board of
Directors, which is designed to further improve the flexibility of management decisions.

See the SBS Group website for details about corporate governance. The website includes the SBS Holdings
Corporate Governance Guidelines, which summarize the SBS Group's basic framework and approach regarding
corporate governance, as well as the Report on Corporate Governance submitted to the Tokyo Stock Exchange.
TOP → Investor Relations → Corporate Governancehttps://www.sbs-group.co.jp/sbsh/ir/governance/

49 SBS GROUP Integrated report 2022

Assessment of Internal
Control Related to Financial
Reporting for Fiscal 2020

ValidGovernance Corporate Governance System

SBS Group through their attendance at Board of Directors meetings.
An executive officer system has been introduced to speed up
decisions on management strategy and further enhance systems forthe execution of business.

The Company has established a General Meeting of Shareholders,
Board of Directors, Audit & Supervisory Committee and Accounting
Auditor as corporate bodies.

■

General Meeting of Shareholders

The Company regards those shareholders listed or registered in
the final shareholders' register as of December 31 of each year to be
the shareholders entitled to exercise their rights at the Ordinary General Meeting of Shareholders in that fiscal year. The Ordinary General
Meeting of Shareholders is convened within three months of the day
following the last day of each fiscal year. In addition, extraordinary
general meetings of shareholders are convened whenever necessary. The General Meeting of Shareholders is convened and chairedby the President and Representative Director. Resolutions made as
decision-making mechanisms at the General Meeting of Shareholders are carried out based on a majority of the voting rights of shareholders who are present and entitled to exercise their rights, except
when otherwise provided for by law or the Articles of Incorporation.

■■

Audit & Supervisory Committee

The Audit & Supervisory Committee is made up of three directors who
are Audit & Supervisory Committee members, two of whom are outside
directors. The Audit & Supervisory Committee meets at least once amonth and on an extraordinary basis when necessary, and fulfills the roleof auditing and supervising the execution of duties by members of theBoard of Directors other than Audit & Supervisory Committee members
and matters of legality. The Audit & Supervisory Committee members,
primarily its chairperson, also attend Board of Directors meetings andother key internal meetings where they provide advice as necessary.

■

Accounting Auditor

The accounting auditor retained by the Company is selected by aresolution of the General Meeting of Shareholders. The term of appointment of the Accounting Auditor shall expire at the end of the Ordinary General Meeting of Shareholders that is the final such meeting
within the fiscal year ending within one year of the Accounting Auditor's appointment. Compensation and other matters concerning the
Accounting Auditor shall be designated by the Representative Director with the consent of the Audit & Supervisory Committee.
There are two reasons why the Company has adopted this current
structure: (1) to ensure the swift decision making and the flexibility ofdecision-making bodies as the greatest management strengths of SBS
Holdings and the SBS Group; and (2) to firmly maintain sound management through the objective and neutral monitoring of management.

Board of Directors

The Company's Board of Directors comprises 12 members, fiveof whom are outside directors. Except when otherwise provided forby law, the Representative Director and President shall convene andchair meetings of the Board of Directors, but an Audit & Supervisory
Committee member appointed by the Audit & Supervisory Committee may also convene Board of Directors meetings. As a decision-making body, the Board of Directors decides on matters required by law, matters set forth in the Articles of Incorporation, management policy and important matters related to management. The
board also monitors and supervises directors in the performance of
their duties. Resolutions of the Board of Directors are passed whena majority of directors eligible to take part in votes are present,
based on a majority of the votes of those directors in attendance.
The Board of Directors meets at least once a month and on an
extraordinary basis when necessary, operating under a structure thatenables swift and effective decision making on the part of directors.
In addition, some directors with the exception of outside directors
serve concurrent roles as directors of the Group's major subsidiaries, in order to enable the deliberation of important matters concerning subsidiaries and facilitate smooth communications within the

Number of Board of Directors Meetings and Status of Attendance(FY2021)

Meetings

13

AttendanceRate (%)

All Directors (12 members)

98%

Outside Directors (5)97%Number of Audit & Supervisory Committee Meetings and Status of
Attendance (FY2021)
Meetings

14

Attendance Rate (%)

97%

Organizational Chart of Corporate Governance
General Meeting of Shareholders
Reporting Stating opinions
Appointment Dismissal
Coordination

Appointment Dismissal

Audit & Supervisory
Committee
Director

Board of Directors(Audit & Supervisory
Committee members)

Accounting Auditor

Investigation

Auditing
Department
Audit

Audit

Audit
Supervision

Instruction
Reporting

Reporting

Risk Management Meeting
Compliance Meeting
Reporting

Representative Director

Instruction Direction

SBS Holdings Departments and Group Companies

Reporting

Environmental Management
Promotion Meeting
Transportation Safety
Promotion Meeting
Information Security
Promotion Meeting

Internal Reporting System

ReportingExecutive Officer

CSR Promotion Committee(Chairperson: Representative Director)(Not Audit & Supervisory
Committee members)

Instruction Supervision
Correction
Reporting

ReportingDirector

Selection Dismissal

Coordination

Coordination

Appointment Dismissal

Consultation
and reporting

General Workplace Consultation
OfficeAudit & Supervisory Committee
Member Hotline
Attorney hotline
SBS GROUP Integrated report 202250

Governance List of Directors, Executive Officers * As of July 1, 2022

Board of Directors

Masahiko Kamata

Yasuhito Tanaka

President, Representative Director and CEO

Director, Executive Officer

Number of Shares Held: 14,388,400

Number of Shares Held: 4,400

Mr. Kamata has served as the Company's President
and Representative Director since March 1988,
and as CEO since March 2004. He also serves asrepresentative director of SBS Group companies,
including SBS Logicom Co., Ltd. and SBS Sokuhai
Support Co., Ltd., and as a director of SBS Flec Co.,
Ltd., SBS Zentsu Co., Ltd., SBS Ricoh Logistics
System Co., Ltd. and SBS Toshiba Logistics Co.,
Ltd. Additionally, he assumed the post as director of
the SBS Kamata Foundation in July 2013.

After working at The Sumitomo Bank, Ltd. (nowSumitomo Mitsui Banking Corporation Group), heassumed the post of Assistant General Manager of
the Corporate Planning Department of SBS Holdingsin November 2010. He has served as an executive
officer (General Manager of Corporate Planning
Dept.) since December 2018 and as a director since
March 2021. He also serves as a director of SBS
Asset Management Co., Ltd., L-MAX Co., Ltd., SBS
Ricoh Logistics System Co., Ltd. and SBS Toshiba
Logistics Co., Ltd.

Masato Taiji

Katsuhisa Wakamatsu

Director, Managing Executive Officer

Director

Number of Shares Held: 13,100

Number of Shares Held: 6,700

He has served as General Manager of the Human
Resources Division of Tokyu Logistics Co., Ltd. And
TL LOGICOM Co., Ltd., both of which are currently
SBS Logicom Co., Ltd., and has been a Director of
SBS Holdings since March 2017. From March 2019,has also served as Managing Executive Officer (incharge of Human Resources and General Affairs).

After working as head of the Production Management
Center at Ricoh Company, Ltd., in October 2011 hebecame a Director and Executive Officer of Ricoh
Logistics System Co. Ltd. (now SBS Ricoh Logistics
System Co., Ltd.) as Representative Director,
President and Chief Executive Officer of Ricoh
Logistics in October 2013. He has also served as a
Director of SBS Holdings since March 2019.

Kenichi Iriyama

Gen Kato

Director

Director

Number of Shares Held: 144,000

Number of Shares Held: -After working at the Long-Term Credit Bank of Japan(now Shinsei Bank, Limited), he took on the post as
General Manager of the Corporate Planning Officeof SBS Co., Ltd. (now SBS Holdings Co., Ltd.) from
June 2002. He served as Director and General
Manager of the Administration Department, Managing
Executive Officer, and from March 2019 Senior
Executive Officer of the SBS Holdings. He took on his
current post as Director from March 2022. He also
serves as a Director of SBS Group companies.

After working as General Manager of the Logistics
and Production Division of Kirin Business System
Co., Ltd., as Director and East Japan BranchPresident of Kirin Logistics Co., Ltd., President andRepresentative Director of Kirin Group Logistics Co.,
Ltd. and Executive Officer of Kirin Brewery Co., Ltd.
From December 2019 he became Vice President andExecutive Officer of SBS Flec Co., Ltd., and since
March 2020 has served as Representative Director,
President and Executive officer of SBS Flec Co., Ltd.
and as a Director of SBS Holdings.

Male / Female Ratio of Directors

Male:

Female:11
1(Male: 92%, Female: 8%)
For more detailed information on the biographies ofeach director, please refer to the "Company
Officers" section in SBS Holdings' securities report.

51 SBS GROUP Integrated report 2022

Audit & Supervisory Committee

Jiro Iwasaki

Takashi Endo * Newly appointed

Outside Director

Director (Full-time Audit & Supervisory
Committee Member)
Number of Shares Held: -Number of Shares Held: 200
Mr. Iwasaki serves as a Director and Senior Executive
Officer at TDK Corporation and as a Director andManaging Executive Officer at JVC Kenwood
Corporation (General Manager of Corporate
Strategy). He has served as an Outside Audit &Supervisory Board Member and now Outside Directorof GCA Corporation, and also serves as an Outside
Director of Renesas Electronics Corporation. At
SBS Holdings, he was appointed Outside Audit &Supervisory Board Member from March 2011, andhas served as an Outside Director since March 2015.

After working at the Long-Term Credit Bank of Japan(now Shinsei Bank, Limited) for 30 years, he took
on the post of General Manager of the Corporate
Planning Department, Executive Officer and General
Manager of Finance at the Company, and served as
Representative Director of Japan Logistics Future
Investment Fund (now Japan Logistics Future
Investment). From March 2022, he has served as a
Director (Audit & Supervisory Committee member) of
the Company.

Tetsuya Sekimoto

Masato Matsumoto

Outside Director

Outside Director (Audit & Supervisory

Number of Shares Held: -Committee Member)

In April 1991 Mr. Sekimoto established Sakurasogo
Law Offices (now Del Sole Sakura Law Office).
In November 2012 he assumed the post ofRepresentative Director of Del Sole Consulting
Corporation. He serves as an Audit & Supervisory
Board Member of Koyo Chemical K.K., Outside Audit& Supervisory Board Member of Premium Value Bank
K.K., and as an Outside Director of Mitsumi ElectricCo., Ltd., Samantha Thavasa Japan Limited and IBJ
Inc. He has served as an Outside Director of SBS
Holdings since March 2014.

* Serving concurrently
as director

He has served as a Managing Executive Officer,
Vice President and Representative Director at
Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.,and in the same capacity as Managing Executive
Officer at Mitsubishi UFJ Financial Group, Inc. Since
March 2019, he has served as an Outside Audit &Supervisory Board Member of SBS Holdings, and as
an Outside Director (Audit & Supervisory Committee
member) since March 2021.

Shuichi Hoshi

Sachie Tsuji

Outside Director

Outside Director (Audit & Supervisory

Number of Shares Held: 2,000

Committee Member)

After working as General Manager and Executive
Officer of the Food Products Marketing & Distribution
Department of Itochu Corporation and as President
and Representative Director of Itochu-Shokuhin Co.
Ltd., Mr. Hoshi assumed the role of Outside Directorof SBS Holdings from March 2019. Since June
2020 he has also served as an Outside Director ofMorinaga & Company, Ltd.

Executive
OfficerNumber of Shares Held: -Masahiko Kamata

Representative Executive Officer*

Masato Taiji

Executive Officer*

Yasuhito Tanaka

Executive Officer*

Natsuki Gomi

Executive Officer

Number of Shares Held: As a certified public accounting, Ms. Tsuji has served
as a Representative Director of SPLUS Corporation,
Director of Tsuji Sachie Public Accounting Office,Director of the Association of Certified Fraud Examiners, as an Outside Audit & Supervisory Board
Member of C’BON COSMETICS Co.,Ltd, and as an
Outside Audit & Supervisory Board Member of Shindengen Electric Manufacturing Co., Ltd. Since March
2021, she has served as an Outside Director (Audit &Supervisory Committee member) of SBS Holdings.

Responsibilities:
Human resources and general affairs
Assigned Departments: CSR Promotion Department, Human Resources Division, General Affairs Division, Legal Office, Logistics Quality
Control Division

Responsibilities:
Corporate planning, business oversight
Assigned Departments: Corporate Planning Division, Business Development Division, Business Strategy Division

Responsibilities:
Finance, IT/LT oversight
Assigned Departments: IR and Corporate Communications Division, Finance Division, Accounting Division, Information Systems Division 1,
Information Systems Division 2, IT Planning division, LT Planning Division, Group Common Infrastructure Promotion
Division

SBS GROUP Integrated report 2022

52

Governance Ensuring Effectiveness■Appointment of Directors

As directors of SBS Holdings, the President nominates individuals who
possess a vast array of knowledge and expertise concerning SBS Groupmanagement, financial strategy, risk management and legal compliance,
are of outstanding character, and who possess the knowledge, experience and skills to fulfill their responsibilities. After seeking feedback fromoutside directors, the Board of Directors is consulting on draft nominations, which are then approved by the General Meeting of Shareholders.
In addition, in the appointment of the representative directors of Group
companies and other top management, the President nominates individuals of outstanding character who possess the knowledge, experienceand skills to fulfill their responsibilities. After receiving approval by the
SBS Holdings Board of Directors, the nominations are approved by theGeneral Meeting of Shareholders of the Group company concerned.
Also note that SBS Holdings lists the individual reasons for nomination
for all candidate directors in the Convocation Notice for the General
Meeting of Shareholders.

Number of independent officers
among outside directors■

4(out of 5)

Restrictions on Concurrent Positions Held by
Company Directors

An internal director of SBS Holdings shall only serve concurrently as
an officer at another publicly listed company when there are clear reasons for doing so, such as helping to strengthen the business relationship with that company, and the officer concerned shall focus on theirduties at SBS Holdings as much as possible. The status of these concurrent positions is disclosed in business reports on an annual basis.

■

Outside Directors

SBS Holdings has been working to expand its ranks of outside officers to bolster management supervisory functions. These efforts
are also expected to achieve highly independent and transparent

monitoring functions and play a part in the formation of new ideas
and principles that are not beholden to customary practices. Standards on the independence of outside directors are set forth in Appendix 1 of the Corporate Governance Guidelines to prevent conflicts of interest with regular shareholders.
To encourage lively discussions at Board of Directors meetings, meeting materials are sent to members in advance, and at the request of outside directors, the departments raising agenda items may provide priorbriefings to outside directors on the matters to be discussed, as part of efforts to minimize information disparities with internal directors. In addition,
one member of staff is appointed to assist the duties of outside audit & supervisory board members, and the Auditing Department, the internal auditing organization of the Company, also provides assistance as needed.

■

Balance of knowledge, experience and abilities
on the Board of Directors overall, and approachto the board's diversity and size

When appointing candidates for director, in addition to the perspectiveof strengthening management oversight functions, a balance between
the number of people in supervisory and executive roles is also considered. In addition, to effectively fulfill the role and purpose of the Board of
Directors, the board is made up of personnel who possess experienceand knowledge of priority issues that related to business management.
When appointing candidates for outside director, people with management experience at companies from other industries are considered, not limited to those from the logistics industry which constitutes
the core business of the SBS Group, and candidates are appointed
with diversity in mind, including those with expert knowledge related tolaw and accounting audits.
Candidates for internal director are selected from among those witha wide range of knowledge and expertise related to the managementof the SBS Group, financial strategy, risk management and compliance, and the representatives of the SBS Group's core subsidiaries
are also considered.
The Company is considering disclosing the combination of skills
and other qualities possessed by its directors by way of a skills matrix.

Appointment of Outside Directors
NameAudit & Supervisory
Committee Members

Jiro
Iwasaki

Tetsuya
Sekimoto

Shuichi
Hoshi

MasatoMatsumoto

SachieTsuji

Independent
Officer

Reason for Appointment

Concurrent Posts○

Jiro Iwasaki brings a wealth of experience and broad insightconcerning management from many years as a company Outside director (full-time audit & supervisory committee
officer, and was appointed on the expectation that his member) of GCA Corporation
experience and knowledge as an outside officer can be Outside director of Renesas Electronics Corporationreflected in the management of SBS Holdings.

○

Tetsuya Sekimoto possesses extensive experience andexpert knowledge as an attorney as well as experience andknowledge as an outside officer, and was appointed on the Outside director of IBJ Inc.
expectation that these experience and knowledge can beutilized for the compliance management of SBS Holdings.

○

Shuichi Hoshi worked for many years as the head of the foodlogistics department for a general trading company and was
appointed on the expectation that the business experience Director of Itochu-Shokuhin Co. Ltd.
he accumulated there and managerial acumen he has Outside director of Morinaga & Company, Ltd.
cultivated as a company officer can be utilized as a director of
SBS Holdings.

○

Masato Matsumoto possesses extensive experience as acorporate manager at a financial institution along withconsiderable knowledge regarding finance and accounting.
He was appointed on the expectation that his broad Outside director of Sundrug Co., Ltd.
knowledge in these areas can be reflected in the auditing of
SBS Holdings.

○

Sachie Tsuji possesses many years of experience working on
internal control, internal auditing and compliance in addition
to her specialized knowledge and experience as a certified
public accountant, and was appointed on the expectationthat her specialized knowledge in these areas can bereflected in the auditing of SBS Holdings.

53 SBS GROUP Integrated report 2022○

Representative director of SPLUS Corporation
Director of Tsuji Sachie Public Accounting OfficeDirector of the Association of Certified Fraud Examiners
Outside audit & supervisory board member of C’BON
COSMETICS Co., Ltd.
Outside audit & supervisory board member at
Shindengen Electric Manufacturing Co., Ltd.

■

Officer Remuneration

To coincide with the shift to a company with an Audit & Supervisory Committee, the Company resolved a policy at a Board of Directors meeting concerning decisions related to the amount and calculation methods of remuneration for directors (excluding directors
who are Audit & Supervisory Committee members).
With the aim of incentivizing sustained growth and enhanced corporate value, in accordance with the Internal Regulations on Director
Remuneration the remuneration of the Company's executive directors comprises base remuneration determined on a positional basis,and performance remuneration linked to the Company's businessresults. The ratio of performance remuneration to total remunerationis set at around 15%. As the subsidiaries concerned conduct theperformance evaluations of directors who concurrently serve as therepresentative directors of subsidiaries, the remuneration of those directors at SBS Holdings comprises only the base remuneration, pursuant to the Internal Regulations on Director Remuneration. The remuneration of outside directors (excluding directors who are Audit &Supervisory Committee members) comprises only base remuneration, pursuant to the Internal Regulations on Director Remuneration.
To better link with Company business performance with remuneration and to enhance objectivity and transparency, performance remuneration uses consolidated operating income as a measure for
evaluation. Amounts for performance compensation are calculated
by taking the sum of quantitative points based on the achievementof consolidated operating income targets and qualitative points thatassess each officer's required roles, functions, responsibilities andachievements, and multiplying it by a base amount determined foreach officer. The target consolidated operating income (excluding
gain on the sale of real estate) related to performance compensationin the fiscal year under review was 10,700 million yen, and the Company posted 10,790 million yen, achieving this target.
The remuneration of directors (excluding directors who are Audit& Supervisory Committee members) is determined by the President
and Representative Director Masahiko Kamata, having been entrusted to do so by the Board of Directors, by formulating remunerationplans for each director in accordance with internal regulations on director remuneration and seeking feedback from directors who are
Audit & Supervisory Committee members and outside directors. The
reason for this delegation of authority is that the Board of Directors
has determined that it is most reasonable for the President and Representative Director, who has been responsible for the managementof SBS Holdings and the SBS Group for many years, to evaluate theperformance of each director's assigned duties in the broader context of the Company's overall performance. Also note that the Boardof Directors has determined that the details of individual remuneration of directors in the fiscal year under review were set in light ofCompany performance and in accordance with the aforementioned
internal regulations.
Upper limits on the total remuneration of the directors of SBS
Holdings were approved by the 35th General Meeting of Shareholders held on March 25, 2021. Remuneration for directors who are not
Audit & Supervisory Committee members is limited to 200 million
yen annually (of which up to 40 million yen is allocated to outside directors), and remuneration for directors who are Audit & Supervisory
Committee member is limited to 50 million yen annually.

Composition of Director Remuneration
Consolidated Operating Income Associated with
Performance-Linked Remuneration in the Fiscal Yearunder Review

Base Compensation (approx. 85%), set by position

Target:Performance Compensation (approx. 15%),
linked to Company performance

Results:

10,70010,790

million yen
million yen* Excluding gains from the sale of real estate

Remuneration for Each Officer Category (Fiscal 2021 Results)
Officer Category

Directors who are not Audit & Supervisory
Committee members (of which, those who

Total Amount of
Remuneration, etc.

Total Amount of Remuneration, etc. by Type (million yen)

Number of
Eligible Officers(million yen)

Base
Compensation

Performance
Compensation

113 (20)103 (20)

10 (-)

10 (3)

20 (9)

20 (9)

- (-)

3 (2)

10 (3)

10 (3)

- (-)

4 (2)

are outside directors)

Directors who are Audit & Supervisory
Committee members (of which, those who
are outside directors)

Audit & Supervisory Committee members(of which, those who are outside Audit &Supervisory Committee members)

SBS GROUP Integrated report 2022

54

Governance Ensuring Effectiveness■

Effectiveness of the Board of Directors

SBS Holdings has conducted anonymous questionnaires toself-evaluate the effectiveness of the Board of Directors annually
since 2017. From fiscal 2017 to fiscal 2020 the same initial questions were maintained to enable comparisons from year to year, but
in light of the shift to the structure of a company with an Audit & Supervisory Committee and the market segment change in Tokyo
Stock Exchange, the questionnaire was revised, including the addition of questions.
The average score on all questions in the questionnaire that was
conducted among all directors (13 people) including Audit & Supervisory Committee members in fiscal 2021 was 3.95 (5-point scale),suggesting in summary that the level at which the Board of Directors
should function has been largely maintained. For the items andquestions that were problematic, the Board of Directors will take thenecessary action following extensive discussions, and work to makeongoing improvements to enhance its effectiveness.
Format of the Survey(each question graded on a five-point scale)Composition of the Board of Directors (three questions)Operation of the Board of Directors (five questions)
3 Matters taken up by the Board of Directors (ten questions)
4 Systems supporting the Board of Directors (fourquestions) 22 questions in total
2* The survey included a space for respondents to supplement their assessments anddescribe other opinions.

■

3.95

points(5-point scale)

Improving the Skills of Directors

To ensure that directors fulfill their expected roles, the Company
describes their obligations and responsibilities as directors when
they assume their posts. In conjunction with this, outside directors
receive briefings on the management policy of the SBS Group andother matters related to its business activities.
As ongoing training for directors, SBS Holdings invites outside instructions to conduct training sessions around twice a year, and also
provides the necessary support for directors to improve themselves.

55 SBS GROUP Integrated report 2022

Operation of the Audit & Supervisory Committee

The Audit & Supervisory Committee members of SBS Holdings
attend important internal meetings and are able to provide advice asnecessary. They are also given the right to freely view the minutes ofvarious meetings and other documents.
To facilitate the smooth operation of the Audit & Supervisory
Committee, the company has assigned one individual as a full-time
staff member of the Board to assist with its duties, and the Company's Auditing Department also assists with tasks as needed. Mattersconcerning authority of personnel matters such as the appointment
or transfer of Audit & Supervisory Committee staff are decided after
obtaining consent from the Audit & Supervisory Committee in advance.
Audit & Supervisory Committee members, the SBS Holdings Auditing Department and the accounting auditor appointed by SBS
Holdings coordinate with the internal control departments of SBS
Holdings and SBS Group companies to formulate and execute auditing plans and to report the results to the Board of Directors.

■

1

Average Score Obtained in
the Evaluation of theEffectiveness of the Boardof Directors■

Status of Accounting Audits

The Company's accounting audits are handled by Ernst & Young
ShinNihon LLC. This auditing firm has been selected based on acomprehensive evaluation, including that it possesses a certain sizeand global network enabling effective auditing consistent with theCompany's business activities, that it has developed review systems, as well as its auditing track record. Note that the Company
has been continually audited by the same auditing organization for
21 years.
Two certified public accountants carried out the auditing work forfiscal 2021, designated limited liability partners and managing partners Yoichi Tsukimoto and Katsuya Ishida. They were assisted byseven certified public accountings and 24 other personnel.
Compensation for the auditing work is determined based on thedetails of the auditing plans presented by the auditing firm, by way of
producing an estimate of the valid number of days spent engaging in
the auditing work.

Governance Maintaining Constructive Ties with Shareholders■

Ensuring Shareholder Rights

The Corporate Governance Guidelines of SBS Holdings state thatin light of the importance of shareholder rights, the Company shallendeavor to enhance management transparency through the proactive disclosure of information, and develop an appropriate environment in which the rights of all shareholders are ensured. As a part ofthese efforts, the Company reports to the Board of Directors on thestatus of approval or rejection of the Company's proposals submitted to the General Meeting of Shareholders, and if more than 20% of
votes are cast in opposition to a Company proposal, the Company
considers action, including dialogue with shareholders, as necessary.

following approval by the Board of Directors, while taking into
account the business performance of the Company and the Group,
the impact on the stock market, and other factors.
Regarding the exercising of voting rights, as a general rule theCompany makes individual determinations regarding the management policies, business strategies and other information about thecompanies in which it holds stock, judges whether the details of proposals to be voted on by shareholders contribute to the improved
corporate value of that company, SBS Holdings and the SBS Group,and decides whether to approve or reject proposals on that basis.

■■

Reinvigorating the General Meeting of
Shareholders and Facilitating the Exercising of
Voting Rights

The Company places an emphasis on constructive dialogue withshareholders and endeavors to develop an appropriate environment regarding the exercising of rights by shareholders at the General Meetingof Shareholders. In addition, the Company recognizes that the exercising of shareholder voting rights as the General Meeting of Shareholders
is one of the important rights of shareholders, and makes every effort toprovide appropriate information that will aid in decisions concerning theexercising of voting rights in a timely and appropriate fashion.
To ensure that as many shareholders as possible can attend general meetings of shareholders and exercise their voting rights, theCompany sets the dates on which such meetings are convened so
as not to overlap with days on which many such meetings are heldby other companies.
To give shareholders an ample period of time to consider the proposals put forth at a general meeting of shareholders, the Company
endeavors to send out the Convocation Notice for the General Meeting of Shareholders earlier than required by law. In addition, the convocation notice is posted to the websites of the Company and theTokyo Stock Exchange without delay following a resolution by the
Board of Directors on convocation.
Shareholders can choose the manner in which they exercise theirvoting rights, either in writing, or via the Internet by accessing a
Company-designated website for exercising voting rights from a PC,
smartphone or mobile phone.
Also note that when the voting rights held by overseas investors
as a percentage of total voting rights 20% or more, the Company willtranslate financial results briefing materials and convocation notices
into English, and endeavor to develop an environment that makes it
easier for overseas investors to exercise their voting rights.

■

Handling of Cross-Shareholdings

The Company holds stocks in another company only when it determines doing so to be important in building a cooperative relationship with a partner company for the sustainable growth of SBS
Holdings and the SBS Group into the future, and when there is significance in maintaining cross-shareholdings from the perspective ofenhancing the corporate value of the Company and the Group.
For major cross-shareholdings, the Company verifies the benefits
gained by maintaining or strengthening business relationships foreach individual stock, and when it determines that "continuing tohold stock in a certain company will have minimal contribution to theenhanced corporate value of SBS Holdings and the SBS Group in
the medium and long term," the stock in such a company is soldTakeover Defense Measures

The basic policy of the Company is to not employ so-called "takeover defense measures." When shares in the Company are subjected to a tender offer, the Board of Directors will clearly explain its position to shareholders and ensure that the appropriate proceduresare followed.
Overview of the 36th Ordinary General Meeting of
Shareholders
Date and Time
Friday, March 25, 2022, from 10:00 a.m.
Location
Nishiki Room, 4th Floor, Tobu Hotel Levant Tokyo,1-2-2 Kinshi,
Sumida-ku, Tokyo, Japan
Matters Reported
1. The Business Report and Consolidated Financial Statements for theCompany’s 36th Fiscal Year (January 1, 2021 - December 31, 2021)
and results of audits by the Accounting Auditor and the Audit &Supervisory Committee of the Consolidated Financial Statements
2. Non-consolidated Financial Statements for the Company’s 36th
Fiscal Year (January 1, 2021 - December 31, 2021)
Proposals for Resolution and the Results
Proposal 1: Partial Amendments to the Articles of Incorporation
1. To strengthen the head office functions and make further
improvements to operational efficiency by consolidating the head
offices of the Company and of the individual companies in the Group,
the Location of Head Office stipulated in Article 3 of the current Articles
of Incorporation shall be changed from “Sumida-ku” to “Shinjuku-ku."
2. The amended provisions stipulated in the supplementary provisionsof Article 1 of the “Act Partially Amending the Companies Act” (Act No.
70 of 2019) will be enforced on September 1, 2022. Accordingly, toprepare for the introduction of the system for electronic provision ofmaterials for general meetings of shareholders, the Company’s Articles
of Incorporation shall be amended.
Proposal 2: Election of Ten (10) Directors Not Serving as Audit &Supervisory Committee Members
Masahiko Kamata, Kenichi Iriyama, Masato Taiji, Yasuhito Tanaka,
Katsuhisa Wakamatsu, Gen Kato, Hiroaki Sato, Jiro Iwasaki, Tetsuya
Sekimoto and Shuichi Hoshi will be elected as directors not serving as
Audit & Supervisory Committee members.
Proposal 3: Election of One (1) Director Serving as Audit & Supervisory
Committee Member
Takashi Endo will be elected as Director serving as Audit & Supervisory
Committee member. As Mr. Endo has been elected to fill the position
vacated by former Director serving as Audit & Supervisory Committee
member Yasuhiro Yamashita, under the provisions of the Company's
Articles of Incorporation, the term of office will be until the original
expiry of the term of office of the retiring Director serving as Audit &Supervisory Committee Member.
Proposal 4: Election of One (1) Substitute Director Serving as Audit &Supervisory Committee Member
Tomoyuki Suzuki will be elected as substitute Director serving as Audit& Supervisory Committee member.
The Convocation Notice for the General Meeting of Shareholders and the Extraordinary
Report (including "The Number of Voting Rights for Approval, Disapproval and Abstention in
the Matters Resolved, the Requirements for Adoption of the Matters Resolved, and theResults of the Resolutions") can be viewed on the SBS Holdings website.
Top → Shareholder and Investor Information → General Meeting of Shareholders
https://www.sbs-group.co.jp/sbsh/ir/meeting/

SBS GROUP Integrated report 2022

56

Governance Maintaining Constructive Ties with Shareholders■

Capital and Dividend Policies■

The Company strives to improve corporate value and shareholder
value through the sustainable growth of SBS Holdings and the SBSGroup. To maintain financial health that can withstand strategic
investments made for corporate growth, we target a shareholders'equity ratio of 30% or higher and do our utmost to achieve this.
The Company considers shareholder return to be one of its mostimportant management issues. The Company's basic policy is tocontinuously maintain dividend levels and endeavor to raise dividendlevels based on business performance while retaining sufficientinternal reserves to build a solid management base.

Shareholders’Equity Ratio

Dividend per Share(Year ended December 31, 2021)

■

21.9

%

55

yen

Disclosures

In addition to making appropriate disclosures in accordance withlaw, the Company makes disclosures when it has formulated plansconcerning the management foundations, business strategies andother action needed to ensure future business growth in order toachieve improved corporate value in the medium and long term.
We have been making information disclosures in English to theextent reasonable to gain corporate recognition from shareholders,investors and other stakeholders in Japan and overseas, and tocontribute to enhancing corporate value to a global level throughdialogue with stakeholders including shareholders and investors.
As the points of contact in promoting dialogue with shareholders
and investors, the Company has appointed an officer in charge of IR
and designated the IR and Corporation Communications
Department. Primarily the General Manager of the IR and Corporate
Communications Department handles individual dialogue withshareholders and investors, with the President and officer in chargeof IR also taking part as appropriate.

Collaboration With Stakeholders Other Than
Shareholders

Structure

The Company has established the SBS Group CSR Promotion
Committee as a joint effort of SBS Holdings and the SBS Group topromote action on the issues surrounding sustainability. Meetingbodies operated under the committee decide on and implement
action policies to deal with various issues.

Responding to the Corporate Governance Code
The Company places an importance on the Corporate
Governance Code (formulated and published by Tokyo Stock
Exchange, Inc. in cooperation with the Financial Services Agency) asa document that summarizes the key principles contributing to thesustainable growth and medium-to-long term improvement incorporate value of publicly listed companies. The Company has also
embraced the "comply or explain" stance required by the code.
In its corporate governance report, SBS Holdings reports on its
disclosure status according to the principles of the Corporate
Governance Code, and for those supplemental principles whichhave not been immediately addressed in their entirety, the Company
explains the reasons and describes its outlook for the future.

●

●

●

●

●

Measures for substantial shareholders' attendance at meetings ofshareholders (Supplementary Principle 1-2-5)
Oversight of plans for successors for CEO, etc. (Supplementary
Principle 4-1-3)
Procedures for appointment or removal of representative director(Supplementary Principles 4-3-2, 4-3-3)
Coordination between independent outside directors and top
management, such as the appointment of a lead independent
outside director (Supplementary Principle 4-8-2)
Establishment of a Nomination Committee and Compensation
Committee (Supplementary Principle 4-10-1)

The Corporate Governance Report submitted to Tokyo Stock Exchange, Inc. isposted on the SBS Holdings website.
TOP → Investor Relations → Corporate Governancehttps://www.sbs-group.co.jp/sbsh/ir/governance/■

Basic Approach

Seeking enhanced corporate value in the medium and long termon keeping with the SBS Group Code of Behavior, SBS Holdings
and the SBS Group make every effort to respect stakeholders, clarify
the purpose of the Company and the Group to them, and maintainpositive relationships.
In addition, the Board of Directors of SBS Holdings takes
responsibility for periodically evaluating whether the SBS Group
Code of Behavior is being broadly put into practice.

57 SBS GROUP Integrated report 2022

Governance Compliance■Management

The SBS Group has established the SBS Group Code of Behavior
and SBS Group Compliance Regulations, and is committed todeveloping its compliance systems and promoting compliance.
Playing a central role in this effort is the SBS Group Compliance
Meeting, which comprises members appointed from SBS Group
companies. In addition to playing a pivotal role in awareness-raising
activities, the Compliance Meeting also monitors, confirms andinvestigates compliance violations and drives improvements.
Awareness-raising tools (compliance cards, compliance manuals,
compliance rulebooks) are also distributed among all Group
employees in an effort to promote fair and ethical conduct andactivities through shared awareness and knowledge.

Number of times the Compliance
Meeting was convened■

2

Also note that a protection system has been put in place byprescribing internal regulations that prohibit the disadvantageous
treatment of those who seek consultation or make reports.

Number of Consultations Fielded byCompliance Consultation Hotlines* Check the CSR data on page 64 for details about
consultations fielded.

■

257

Compliance Awareness Survey

The SBS Group periodically conducts compliance awarenesssurveys to ascertain the extent of compliance awareness among
employees and to monitor changes in the environment surrounding
employees. The survey results are used to roll out new measures,and when issues come to light in the consultation or reporting
hotlines, corrective measures are implemented.

Initiatives to Increase Awareness

The SBS Group tries to increase awareness of compliance by
providing regular training and disseminating information toemployees. In tiered training, we provide instruction focused oncompliance in a broad sense, while in training for specialized
themes, we provide guidance to managers under the theme ofharassment. We also regularly distribute educational materials to thepersons in charge and conduct follow-ups to ensure they canprovide on-site guidance. “Compliance Newsletter” is issued to all
employees to communicate compliance-related paradigms andnews, and we also produce original compliance training videos to bescreened during training and on-site.

Number of Compliance-Related Training Sessions* Tiered training + specialist training (harassment)■

14

Establishment of Consultation and Internal
Reporting Hotlines

The SBS Group has established and operates hotlines throughw hich all employ ee s w ork i n g i n t h e S BS G rou p c a n s e e kconsultation or make reports when they become aware of an issue
with the workplace environment or business operations, or of
conduct that violates laws, internal regulations or corporate ethics.
There are three hotlines, the General Workplace Consultation Office
fielded by the administrative office of the Compliance Meeting, theAudit & Supervisory Committee Member Hotline fielded by full-time
Audit & Supervisory Committee members, and the Attorney hotline
fielded by consulting attorneys. The General Workplace Consultation
Office allows a choice of contact details (direct dial) for consultation
staff (male or female) at the discretion of the person seeking
consultation.
The consultations and reports received by each hotline arereported to the Board of Directors by the administrative officer of the
SBS Group CSR Promotion Committee. After conducting an
objective investigation and verifying the facts of a case, the response
is discussed with the relevant departments of SBS Holdings and the
SBS Group.

"General Workplace Consultation OfficeCounseling room for all workplace concerns"
posters

Reporting and Consultation Flow
SBS Group Employees
ReportingConsultation

SBS Group Internal Reporting Hotline
Internal Reporting Hotline
General Workplace Consultation Office
Audit & Supervisory Committee
Member Hotline
ReportingAttorney hotline

Request for investigation

SBS Group Compliance Meeting(Chairperson: CSR Officer, Administrative Office:
CSR Promotion Department)
ReportingOutside Reporting
HotlineReporting

Request forinvestigation
ReportingInstruction

SBS Holdings Board of Directors

Internal
Investigation
Committee* Established when
it is determinedthat a matter
seriously impacts
management

SBS Group CSR Promotion Committee

SBS GROUP Integrated report 2022

58

Governance Risk management■

Crisis Management Framework

With the SBS Group Risk Management Meeting playing a central
role, information is shared on crisis management matters under thejurisdiction of each meeting body, namely the Transportation Safety
Promotion Meeting, Compliance Meeting and Information Security
Promotion Meeting. When a determination is made that a crisis has
occurred, a company-wide response is initiated in accordance with
the Crisis Management Manual. Note that the response when a
COVID-19 infection has occurred is carried out based on procedures
set forth in SBS Group guidelines.

Main Crisis Matters●

Information Security Promotion Meeting
Major security incidents, cyber-attacks, system failures●

Transportation Safety Promotion Meeting
Vehicle and industrial accidents that involve human life●

Compliance Meeting
Corporate scandals such as inappropriate labor management,■ Development of an Intra-Group Emergency Contact Network
An emergency contact structure and emergency contact network
is maintained and managed to confirm the safety of employees andshare site damage reports as quickly as possible in the event of an
emergency, facilitating business continuity.
■ Developing Site Information and Sharing Hazard Risks
As part of BCM initiatives, site information including hazard risks*
is centrally managed and shared throughout the Group. Sharing
information allows the SBS Group to standardize the measurestaken to address issues and facilitates coordination with nearby
business sites.
* Government-issued hazard maps are used.

■ Ensuring Driver Safety
To ensure driver safety, all Group-operated vehicles are provided
with emergency supplies (water, emergency toilets, thermal sheets
for protection against cold). Additionally, mutual acceptancearrangements have been made so that certain locations can be usedas driver evacuation locations during an emergency.

fraudulent accounting or inadequate information management●

Disaster Response Management (Business Continuity Plan)
Natural disasters such as major earthquakes

Risk Management
Meeting

Transportation Safety Promotion Meeting
Compliance Meeting
Information Security Promotion Meeting■

BCP and BCM

The SBS Group recognizes that in the interest of safeguarding
people’s lives, it has a social responsibility to continue to performbusiness activities with a focus on logistics as a part of social
infrastructure in the event of a major disaster, and has formulated abusiness continuity plan (BCP) accordingly. The BCP clearlystipulates matters such as conditions for countermeasures, advance
preparation, initial response and restoration efforts. We also focus on
business continuity management (BCM), to ensure that the BCP wehave formulated functions properly.
■ Emergency Response Drills
The SBS Group periodically conducts emergency response drills
to prepare for major disasters and other emergencies. The drills
focus on setting up an emergency headquarters and alternate sites
during an emergency, coordinating information such as the state ofdamage and safety at each Group company and site, and sharing all
related information. The specific scenario is changed for each drill.

59 SBS GROUP Integrated report 2022

■ Dedicated Disaster Information Portal Site for Employees
The SBS Group has set up the SBS Group Disaster Information
Portal Site as a dedicated site for employees to share business
continuity-related information such as the state of damage in theGroup in the event of an emergency. At regular times the site
provides useful disaster prevention information.

■

Certified by the Tokyo Metropolitan Government
as a Company Discouraging the Simultaneous
Return Home of Employees during a Disaster

In December 2018, SBS Holdings, Inc. was certified by the Tokyo
Metropolitan Government as a Company Discouraging the
Simultaneous Return Home of Employees during a Disaster. The
certification recognizes the steps taken by SBS Holdings to stockpile
food and supplies for a disaster and the status of various facilities
and intra-Group coordination allowing employees to take refuge inthe offices. Going forward, SBS Holdings will continue to pursue
these initiatives as a certified company.
SBS Holdings is also part of disaster prevention cooperative
agreements with Sumida-ku and non-governmental organizations.

Governance Information Security

The SBS Group recognizes that appropriately protecting andmanaging all kinds of information on customers and otherstakeholders is an important social responsibility. Based on thisbelief, we have established an information security policy and various
standards, and have established an effective management structure
to deal with various information and cyber-security risks.

■Information Security Policy

We have established the SBS Group Basic Policy on Information
Security and declared a Group-wide commitment to tacklinginformation security.

■

Information Security Governance

The SBS Group has established an information security
governance framework through which it strives to maintain astandard Group-wide infrastructure and share information. We havealso set up internal systems enabling us to effectively respond tosecurity incidents and issues. Incident response organizations not
only respond when an incident occurs, but also plan and implement
prevention, education and awareness-raising efforts during normal
times to control security management across the Group.

SBS Group Information Security Governance
CSR Promotion Committee(Chairperson: President of the SBS Group)

SBS Group Basic Policy on Information Security

Periodic reporting

1. We will observe laws, government-issued guidelines andother norms related to information security.
2. We will clarify responsibilities related to information security
and establish systems to implement information security
measures.
3. We will identify information security risks and take appropriate personal, organizational, technical and physical measures.
4. We will conduct training and raise awareness concerning
information security, and ensure that all employees are able
to carry out their work with an awareness of information
security.
5. We will carry out inspections of our information security-related management systems and initiatives, and conduct ongoing reviews and make continual improvements.

■ Information Security Management
The SBS Group has established the SBS Group Information
Security Policy. In accordance with the policy we strive to firmly
maintain security levels, with the Information Security Promotion
Meeting playing a central role in monitoring the status of security
measures on a Group-wide basis while promoting education andawareness-raising related to information security.
■ Protection from Threats
To deal with high-level threats, we have installed an antivirus toolthat employs artificial intelligence (AI). We have also installed anext-generation firewall that strengthens our defenses, not only
against attacks from the outset, but also in the event of an attackfrom the inside.
■ Responding to Vulnerabilities
By introducing a security operation center (SOC) service, we haveenhanced monitoring and checking functions. We also perform
inspections of public server vulnerabilities and perform vulnerability
tests on the necessary servers in an effort to maintain safety.
■ Third-Party Verification
We periodically commission management reviews by specialist
information security firms to improve the level and quality of our
information security management.

Information sharing

SBS Group Information Security
Promotion Meeting(Chairperson: CIO)

Planning of
Proposalsmeasures

Determination

Planning Subcommittee
Auditing andReportingmonitoring

Execution

Group Companies* Formulation and promotion of information security infrastructure
within the Group / disseminating the latest security information
throughout the Group / Measures to quickly establish control
when an incident occurs / education and awareness-raising /development of information security policies and standards forvarious measures■

Education and Awareness-Raising■ Seminars
We offer purpose-built curricula for employees at various levels
and for information security personnel of Group companies.
■ e-Learning
We conduct regular awareness-raising activities, including
requiring employees across the Group to undergo e-learning training
once a year.
■ Investigating Actual Conditions Using Simulated Emails ofTargeted Attacks
Follow-ups (targeted training, etc.) will be conducted based on
the results in an effort to raise literacy levels regarding these threats.

Employees Undergoing Training in Fiscal 2021
Seminarse-Learning

339
6,978
SBS GROUP Integrated report 2022

60

Financial and Business Information

PeriodYear of Financial Results

27th fiscal period

28th fiscal period

29th fiscal period

30th fiscal period

FY2012FY2013

FY2014FY2015Net sales

million yen

127,935

132,205

141,535

157,996

Ordinary income

million yen

2,746

3,779

3,648

5,772

Net income attributable to owners ofparentmillion yen

1,626

1,549

2,725

-3,815Comprehensive income

million yen

1,788

1,817

3,702

-4,693

Net assets

million yen

27,78029,21835,091

29,947

Total assets

million yen

104,496

108,354

131,120

124,817

Net assets per shareYen

716.61742.68811.23706.32

Net income per share

Yen

43.56

40.26

69.77

-96.84

Diluted net income per share

Yen

-

40.09

69.65

-

Shareholders’ equity ratio

%

26.3

26.7

24.3

22.5

Return on equity

%

6.2

5.5

9.0

-12.7

Times

7.7

13.0

14.4

-9.8

Cash flows from operating activities

million yen

7,329

6,257

6,603

7,728

Cash flows from investing activities

million yen-5,520-6,214-15,101-7,081

Cash flows from financing activities

million yen

-829

80

8,893

-2,685

Balance of cash and cash equivalents

million yen

10,175

10,306

11,037

8,984

4,645
(7,999)4,662(7,906)

5,572(8,512)

5,555(8,636)

24

23

27

23

7,196

8,478

15,988

11,142

Stock price to earnings ratio

Number of Employees(additionally, average number of
temporary employees)
Consolidated subsidiaries
Capital Investment

million yen

Notes
1. Net sales do not include consumption taxes.
2. Diluted net income per share in the 30th fiscal period is not listed because of a net loss in that period despite there being potential shares that have a dilutive effect.
Diluted net income per share in the 26th and 27th fiscal periods is not listed as there are no potential shares that have a dilutive effect.
3. For the 31st fiscal period, figures after retrospective application are listed due to the early application of "Current Handling of Accounting for Foreign Subsidiaries in
the Preparation of Consolidated Financial Statements" (Practical Report No. 18, March 29, 2017) and "Current Handling of Accounting for Equity Method Affiliates"(Practical Report No. 24, March 29, 2017) from the 32nd fiscal period onwards.
4. "Partial amendments to the Accounting Standards for Tax Effect Accounting, etc." (Accounting Standards Board of Japan Statement No. 28, February 26, 2018) has
been applied since the beginning of the 34th fiscal period, and for the 33rd fiscal period figures after retrospective application are listed.
5. Diluted net income per share is not listed as there are no potential shares that have a dilutive effect.
6. The number of employees indicates the number of full-time employees.

61 SBS GROUP Integrated report 2022

31st fiscal period

32nd fiscal period

33rd fiscal period

34th fiscal period

35th fiscal period

36th fiscal period

FY2016FY2017FY2018FY2019FY2020

FY2021

149,054

152,870

203,516

255,548

257,192

403,485

7,832

6,475

7,607

10,172

10,883

20,489

5,111

4,446

4,409

6,079

6,826

10,790

5,346

4,702

4,494

6,923

7,181

13,93634,53338,51048,17354,077

68,14680,707

122,330

127,802

171,796

180,047

254,550

277,197818.55916.501,001.05

1,136.22

1,277.92

1,527.58

128.69111.94111.01153.06171.88271.67

-

-

-

-

-

-

26.6

28.5

23.1

25.1

19.9

21.9

16.9

12.9

11.6

14.3

14.2

19.4

6.3

10.1

12.8

12.4

15.2

12.0

12,201

11,671

12,39816,872

17,262

27,472-10,043-8,127-22,433-12,579-30,480-22,343-1,733-1,42014,815-2,08422,726-9,278

9,383

11,53416,303

18,49527,537

23,7955,189(8,652)

5,515(8,911)

6,979(10,575)

7,124(10,674)

9,742(12,098)

10,689(12,805)

17

16

25

24

28

33

10,455

9,576

11,607

11,71011,507

14,501SBS GROUP Integrated report 2022

62

CSR Data

CO2 Emissions

Water Usage

CO2 (t)Emissions per unit of net sales

120,000
100,000

100

9.0■ Usage

60,00040,00020,000(per person) m3: consumption per unit

160,000■Facilities ■Vehicles ■Emissions per unit of net sales

80,0000

Water Resource Usage (t)■ Consumption per Unit80

140,000

8.0

60

120,000

7.0

40

100,000

6.0

20

80,0005.0

060,000

2017

2018

2019

2020

2021

Facilities

16,47522,22326,09032,782

34,595

Usage

Vehicles

61,026

68,572

65,15766,08866,820Total

77,50190,79591,247

98,869101,405

Consumption
per Unit

Emissions perunit of net
sales

52.09

47.77

38.095

40.77

28.23

2016

2017

2018

2019

2020

2021

101,642

111,175

127,524

149,681

147,097

151,070

7.01

7.45

6.71

7.72

6.32

6.31

4.0

* Emissions per unit of net sales are figures for every 100 million yen in sales

Power Consumption

Copy Paper Usage

Electricity Usage ( thousand kWh)(per person: 1,000 kWh) consumption per unit

100,000

4.0■ Usage■ Consumption per Unit

60,00040,00020,000
2016

2017

2018

2019

2020

2021

Usage

33,40532,75444,74052,264

66,386

74,149Consumption
per Unit

2.30

2.19

2.35

2.70

2.85

3.10

(per person: pages) consumption per unit

4,000
■ Usage

80,0000

Copy Paper Usage (thousand sheets)

100,000

3.5

80,0003.0

60,0002.5

40,0002.0

20,000■ Consumption per Unit

3,700
3,400
3,100
2,800
2016

2017

2018

2019

2020

2021

Usage

46,04944,20559,25153,68583,74789,880Consumption
per Unit

3,173

2,964

3,116

2,770

3,598

3,753

2,500

* Calculations are made in accordance with "Joint Guidelines on Methods for Calculating CO2 Emissions in the Logistics Field, Version 3.1" provided by the Agency for Natural Resources and Energyof the Ministry of Economy, Trade and Industry.
* As the majority of CO2 emissions are produced by the operation of vehicles, emissions are influenced by the activity level and efficiency of the SBS Group's overall business activities. For thisreason, net sales, an indicator reflecting the activity level of the company overall, is used as the denominator. However, environmental impacts including water, electricity and copy paper mainly
occur within offices and facilities, and therefore, there is significant room for reduction through employees' environmental conservation efforts. For this reason, these figures are calculated on a
per-person basis.

Status of Environmental Certifications Acquired (as of the end of fiscal 2021)
Certification

Company Name (number of business sites with certification)

ISO14001(Environmental management systems)

SBS Toshiba Logistics, SBS Ricoh Logistics, SBS San-ai Logistics, SBS Logicom, SBS Flec, SBS Freight
Service, SBS Zentsu, SBS Sokuhai Support, SBS Furukawa Logistics

Green Management Certification

SBS Logicom

GPN Certification(Green Purchasing Network)

SBS Logicom * Certified as a delivery service for the Eco Product Net

Investment in the Environment
Investment

Vehicle-related investments(Unit: million yen)

2016

2017

2018

2019

2020

2021

CNG vehicles, LPG vehicles, hybrid vehicles, vehicles
that meet heavy vehicle fuel efficiency standards, etc. 3,250

3,616

3,791

3,055

4,379

3,514

Details

Improved fuel efficiency (eco and safe-driving training,
etc.)

2

1

3

1

19

8

Investments related to improved
energy savings at facilities

Demand monitoring andenergy-efficient lighting, etc.

9

35

45

131

26

14

Investments in global environmental
conservation

Solar power generation, etc.

0

13

6

6

6

29

Environmental management

Environmental management registration andmanagement activities, etc.

8

6

3

3

4

8

Environmental communication

Internal and external awareness-raising, creation ofreporting materials, etc.

5

6

6

6

10

8

3,274

3,677

3,854

3,202

4,444

3,580

Total

* While referencing the Environmental Accounting Guidelines (2005 edition) of the Ministry of the Environment, classifications are made in light of the SBS Group's business characteristics as acomprehensive logistics business operator.
* "Investments in global environmental conservation" are expenditures for the installation, operation, maintenance and upkeep of renewable energy-derived power generating equipment operated by
the Company at its facilities. To date, all such facilities employ solar power generation.

63 SBS GROUP Integrated report 2022

Renewable Energy Generating Capacity

SBS Sokuhai Support waste processing volume(as of the end of fiscal 2021)* Figures in parentheses are within the Group

Generating
Capacity (kW)Facility Name

Generating
Capacity (kW)Facility Name

Amount handled(t)

Item Name

Odawara Sales Branch

210

Waste plastics

2,826

Nagatsuta Logistics Center

935

Recycled plastics

Kawagoe Logistics Center

830

Toyohashi Logistics Center

221

Scrap metal

Nishinihon Logistics Center(Kyotanabe)

617

1,072

Waste wood

Shibayama No. 2 Solar Power Plant

710

Nanko Logistics Center

Kimitsu Branch

268

Daito Warehouse Solar Power Plant

Yoshikawa Branch

223

Yokohama Kanazawa Logistics Center

1,520

Takasaki Sales Office

161

Total

12,666514

Noda Yoshiharu Logistics Center
Shibayama Solar Power Plant

Sugita Logistics Center

940

Tokorozawa Logistics Center

1,490

5,375 (525)0771 (45)208 (102)
1,223 (107)

Paper and other waste

8,360 (1,563)

Total

129

G-Mark Certification Status (as of the end of fiscal 2021)
Company Name

Number of Newly
Certified Business Sites

Number of Business Sites
with Existing Certification

Total Number of G-MarkCertified Business Sites

SBS Ricoh Logistics

-

21

21

23

91.30%SBS Logicom

-

34

34

36

94.40%SBS Freight Service

-

14

14

14

100%

SBS Flecnet

1

22

23

26

88.50%SBS Zentsu

2

67

69

81

85.20%SBS Sokuhai Support

-

8

8

9

88.90%SBS Group Total

3

166

169

189

89.40%

G-MarkNumber of G-MarkEligible Business Sites Certification Rate

* 1 Certification rate of nationwide truck transportation business sites: 32.1% (figure as of December 17, 2021 *from the website of the Japan Trucking Association)* 2 Applicable business sites includes newly established business sites (business sites under three years old that do not meet the requirements for G-mark application).

Status of Human Resource Development Initiatives: SBS Group Training Results (as of the end of fiscal 2021) (Unit: number of employees)
Category

Details

Job class-specifictraining

For each job grade, the knowledge and techniques required for that job grade are taught
Training for new employees Training for managerial employees

7547

For each theme, the specialized knowledge and techniques are taught
Sales skills improvement training
Business skills training, etc.

7

348

Truck safe driving training
Business training provided by each business division
Operation manager skill improvement training
Information security, etc.

9

7,720

Self-directed acquisition of knowledge and skills through correspondence courses, etc.
Correspondence courses
e-Learning
Business Career Certification, etc.

-

351

Specialized themespecific training
Division-specifictraining
Self-development

Number of courses Number of trainees

●

●

●

●

●

●

●

●

●

●

8,966

Total

Status of Quality-Related Certifications Acquired (as of the end of fiscal 2021)

Number of Consultations Fielded byCompliance Consultation Hotlines (FY2021)*

Certification

Company Name (number of business sites with certification)

Details of Consultations

ISO9001

SBS Toshiba Logistics, SBS Ricoh Logistics, SBS Flec, SBS
Flecnet, SBS Furukawa Logistics, SBS Freight Service, SBS
Zentsu, SBS San-ai Logistics

Consultations regarding laws,
regulations and internal rules

129

ISO27001(environmental management systems)

SBS Ricoh Logistics, SBS San-ai Logistics, SBS
Logicom, SBS Sokuhai Support

Consultations regarding interpersonal
relationships in the workplace

107

ISO/IEC27001*

SBS Toshiba Logistics

Others

21

Total

257

(Quality Management Systems)

ISO/IEC17025*(Testing and Calibration Organization
Management Systems)

SBS Toshiba Logistics

Privacy MarkSBS Freight Service, SBS Staff, Marketing
Partner, Nippon Record Center

JAS Organic Agricultural
Product Subdivider Certification

SBS Zentsu

Relocation Safety MarkSBS Logicom

Number ofConsultations* Total consultations fielded by hotlines set up inside and outside
the company from which employees are able to seek direct
consultation* Jointly with the International Organization for Standardization (ISO) and International Electrotechnical Commission (IEC)SBS GROUP Integrated report 202264

Toyo Warehouse & Transportation and Furukawa
Logistics join the SBS GroupSBS Group

Procedures to acquire the shares of Toyo
Warehouse & Transportation were completed on January 29. Following this, weannounced the acquisition of shares inFurukawa Logistics, the logistics subsidiary of Furukawa Electric Co., Ltd. on April
27, and the procedures completed on
December 1. From that day forth, Furukawa Logistics became SBS Furukawa
Logistics and began to fully operate as a member of the SBS Group.
SBS Group
Completed acquisition of shares in Toyo Warehouse & Transportation Co., Ltd.

Jan

Feb

Mar

Apr

May

SBS Logicom
Kyokushin Unyu Kaihatsu (K.U.K. Line) becamea member of the SBS GroupSBS Flec
Acquired all shares of Hinomaru Kyuso Co., Ltd.

Introduced automation system and database system using 3PL(logistics technology)
SBS Toshiba Logistics / SBS Ricoh Logistics

SBS Group

SBS Toshiba Logistics installed 20 shelf-carrying robots. In October, a bulk image inspection system
was developed and introduced to improve productivity and save on labor. In addition, in October
SBS Ricoh Logistics opened the Yokohama Kanazawa Logistics Center. The latest systems including
AutoStore, cutting-edge logistics DX, and material handling equipment were installed.
SBS Holdings introduced SAIS (SBS Automobile Information System), a database system that centrally manages Group vehicle information over the web.

▶▶ Corporate Profile and Stock Information
Corporate Profile
Company Name

* As of July 1, 2022

SBS Holdings, Inc.

Representative Director Masahiko Kamata
Established

December 16, 1987

Paid-in Capital

3,920.75 million yen

Net Sales

403.485 billion yen (consolidated)* For the year ended December 31, 2021

Head Office

Sumitomo Fudosan Shinjuku Grand
Tower 25F, 8-17-1, Nishi-Shinjuku,
Shinjuku-ku, Tokyo, 160-6125, Japan
Tel: 03-6772-8200 (main switchboard)Lines of Business

Logistics business, property
management business, marketingbusiness, human resources business, etc.

Listed ExchangeTokyo Stock Exchange Prime Market(Security Code: 2384)

65 SBS GROUP Integrated report 2022

Officers* As of July 1, 2022

Representative Director

Masahiko Kamata

Director
Director
Director

Masato Taiji
Kenichi Iriyama
Yasuhito Tanaka

Director
Director
Outside Director

Katsuhisa Wakamatsu
Gen Kato
Jiro Iwasaki

Outside Director
Outside Director

Tetsuya Sekimoto
Shuichi Hoshi

Director (Full-time Audit & Supervisory Committee Member) Takashi Endo
Outside Director (Audit & Supervisory Committee Member) Masato Matsumoto
Outside Director (Audit & Supervisory Board Member) Sachie Tsuji

Stock Information
Number of shares authorized 154,705,200 shares
Number of shares issued

39,718,200 shares Including 2,590 fractional shares

Unit stock system

Yes (100 shares)

Number of shareholders

4,501

Acceleration of small M&A
activities by Group companies

Strengthening environmental
conservation efforts

SBS Group

SBS Group

On April 1, SBS Logicom acquired allshares of K.U.K. Line, and SBS Flec
acquired all shares of Hinomaru Kyuso
Co., Ltd. In July, SBS Ricoh Logistics
acquired shares in Jas Co., Ltd, and in
October SBS Sokuhai Support acquired
shares in Ai&Ai. SBS Group companies
have been actively engaged in small M&A
activities aimed at strengthening regionaldelivery capabilities.

In October, the full-scale introduction of EV trucks
commenced in an effort to strengthen reductions tovehicle CO2 emissions. The Group plans to switch
around 2,000 vehicles providing last mile delivery
service to EVs over the next five years. Additionally,
the Kansai Branch of SBS Toshiba Logistics
received a 2021 Osaka City Environmental Bureau
Director's Award in recognition of its waste reduction activities. SBS Ricoh Logistics is pursuing environmental conservation efforts including the implementation of corporate forest activities as aforest volunteer.
SBS Ricoh Logistics
Received award for excellence in 2021
Eco-Driving Activity Contest

Jun

Jul

Aug

Sep

Oct

SBS HoldingsAwarded Eruboshi Certification for
promoting women's participation
and advancement in the workplace

SBS Sokuhai Support
Ai&Ai Chiba Chuo Co., Ltd. became a member of the
SBS Group
SBS Group
Adoption of Electric Trucks in Last Mile Logistics inJapan FirstSBS Sokuhai Support
Obtained ISMS certification at six new business sites
SBS Ricoh Logistics
Logistics Center Yokohama Kanazawa opened

SBS Holdings / SBS Flecnet

In August, SBS Holdings was awarded Eruboshi certificationby the Minister of Health, Labour and Welfare based on the
Act on the Promotion of Female Participation and Career
Advancement in the Workplace. In addition, at the national
truck driver contest held in October, a female driver fromSBS Flecnet placed 5th for the first time, drawing attention
to the active participation of women.

Major Shareholders

Number of
Shares HeldDec

SBS Group
Furukawa Logistics Co., Ltd. (nowSBS Furukawa Logistics Co., Ltd.)
became a member of the SBS GroupSBS Ricoh Logistics
Acquired all shares of Jas Co., Ltd.

Rapidly progressing into a group thatinvolves active women participation

Nov

Shareholding
Ratio

Shareholder NameDistribution of shares by shareholder type
Number of Shares Issued: 39,718,200 shares

Masahiko Kamata

14,388,400

36.22%

Custody Bank of Japan, Ltd. (trust account)

5,156,200

12.98%The Master Trust Bank of Japan, Ltd. (trust account)

1,575,700

3.96%

SBS Holdings Employee Share Ownership Association 1,354,100

3.40%

SMBC TRUST BANK Designated Securities Trust

1,200,000

3.02%

Sumitomo Mitsui Trust Bank, Limited (Trust Account A-13) 1,000,000

2.51%

TOBU Properties Co., Ltd.

986,000

2.48%

Junichi Ouchi

800,000

2.01%

Masaru Wasami

576,700

1.45%

Hiroshi Date

449,800

1.13%* The ratio of shares held against the number of shares issued is truncated after the second decimal place.

■ Individuals and others

21,531,011 shares (54.21%)■ Financial institutions

10,802,800 shares (27.20%)■ Non-Japanese corporations

3,892,373 shares■Japanese corporations

2,513,120 shares(6.33%)

978,321 shares(2.46%)

575 shares(0.00%)■ Securities firms
Treasury stock(9.80%)

Rounded to the nearest three decimal places

SBS GROUP Integrated report 2022

66

Contact for Inquiries
CSR Promotion Department, SBS Holdings, Inc.
Sumitomo Fudosan Shinjuku Grand Tower
25F, 8-17-1, Nishi-Shinjuku, Shinjuku-ku,
Tokyo, 160-6125, Japan
Tel: 03-6772-8200
https://www.sbs-group.co.jp