ESG Report

Corporate Governance
The Yokowo Group aims to achieve its management goals by ensuring management efficiency, transparency andcompliance through the continuous strengthening of its corporate governance, positioned as one of the Groupʼsimportant management challenges.

Board of Directors

Basic Principles Concerning Corporate
GovernanceTo speed up the decision-making process, the Board of Directors
consists of only a limited number of directors (four internal
and two outside directors). The Company has appointed two
independent outside directors (with a high level of independence)
to further strengthen the management supervisory function, andthese include a female outside director.

Recognizing that Yokowo exists today through the supportof its various stakeholders, the Group positions strengthening
corporate governance as one of its important management
challenges. As well as building smooth relations with its
stakeholders, the Group aims to maximize corporate value
through further enhancing its corporate governance.

In addition to one full-time internal Audit & Supervisory Board
Member with sufficient knowledge in finance and accounting,
the Company has appointed two highly independent outside
Audit & Supervisory Board Members to further strengthen the
management audit function.

Executive Officers

Yokowo is a company with auditors and has a system ofcorporate governance consisting of: a Board of Directors
responsible for management strategy and supervisory functions,an Executive Officer system that fulfills business execution, andan Audit & Supervisory Board that performs management audit
functions.

By adopting the Executive Officer system, the strategic decisionmaking and operational supervisory functions are clearly
separate from the executive function, in order to create a systemfor prompt and appropriate execution of operations. In addition
to four internal directors, the Company has appointed eleven▼ Corporate Governance System (As of October 1, 2022)
General Meeting of Shareholders
Elect

Consultation
Supervise

Elect

Audit

Board of Directors outside

Elect

Cooperate

Audit & Supervisory Board

Independent Auditors

Management/Supervision

Reporting

Nomination andCompensation
Advisory
Committee

Cooperate

Audit

Business Execution

Business Risk Management Committee

Administration
Management H.Q.

Management Planning H.Q.
SCI (Sustainability & Corporate Integrity)
Promotion H.Q.

Sales H.Q.
Technical H.Q.

VCCS
Business Div.

CTC
Business Div.

FC
Business Div.

Core Technology Development H.Q.

MD
Business Div. Production Process Innovation H.Q.
Purchasing H.Q.
Quality Assurance H.Q.

Business Organization

33

Yokowo 2022 Integrated Report

The Company established the Nomination and Compensation
Advisory Committee as an advisory body for the Board of
Directors, with the aim of enhancing the transparency of thedecision-making process for matters relating to corporate
governance, such as directors' nomination and compensation.
The Committee has three members, composed of the Company's
two independent outside directors Ms. Kuniko Muramatsu andMr. Makoto Tobari, and the Representative Director, President
and Executive Officer Mr. Takayuki Tokuma, with Ms. Kuniko
Muramatsu serving as chairperson.
The Committee receives requests for consultation fromthe Board of Directors, deliberates and decides on proposals,
and then submits reports to the Board of Directors. The rules
governing the operation of the Board of Directors specify that,in its decision-making, the Board must respect the content of
the reports received from the Committee to the utmost possible
extent.
A summary of the meetings held from April 2021 throughSeptember 2022 and the main agenda items is as follows.

April 2022: Deliberated and decided upon a draft proposal
regarding the payment of bonuses to executive directors andexecutive officers for the fiscal year ended March 31, 2022.
June 2022: Chairperson appointed under the new committee
structure (Ms. Kuniko Muramatsu is reappointed).
September 2022: Discussed the direction of the Board of
Directors and operational methods.

Measures to Enhance Auditing and Supervisory
Functions
As well as sharing information and exchanging ideas in advanceof the Board of Directorsʼ agenda, the Companyʼs outside
directors share matters of deliberation and reports from the
Audit & Supervisory Board to the extent necessary.
Full-time internal auditors ensure compliance andappropriateness by attending important monthly meetings toregularly monitor how business is conducted.

Business Risk Management Committee
Furthermore, the Company has established the Business Risk
Management Committee as an organization under the directcontrol of the President. Its aim is to strengthen the Companyʼscompetitiveness and ability to manage risk, such as by forming
alliances through joint ventures, mergers and acquisitions tofurther advance business, and by verifying the profitability oflarge-scale investments. In addition to regular reports to theBoard of Directors, the Committee conducts activities in close
cooperation with the outside directors.

Audit

President and Executive Officer

Internal Audit Dept.

Initiatives to Improve GovernanceNomination and Compensation Advisory
Committee

Audit & Supervisory Board

Corporate Governance System

executive officers in the positions of Chief Officer, General
Manager, and General Manager at Tomioka plant, etc.

Functional
Organization

May 2021: Deliberated and decided upon a draft proposal
regarding the payment of bonuses to executive directors andexecutive officers for the fiscal year ended March 31, 2021.
September 2021: Discussed the direction of the Board of
Directors, and the succession plan.
October 2021: Deliberated and decided upon a draft proposal
regarding the direction of the Board of Directors, and thesuccession plan.
December 2021: Deliberated and decided upon a draft proposal
regarding the executive structure (directors, auditors, executive
officers) and their compensation for the fiscal year ending March
31, 2023.
February 2022: Deliberated and decided upon a draft proposal
regarding the executive structure (additional) for the fiscal year
ending March 31, 2023.

Analysis and Evaluation of theEffectiveness of the Board of Directors
Since 2016 Yokowo has been conducting self-evaluation
surveys and, when necessary, interviews with all its directors andauditors, collecting the results and analyzing them.
This year (2022), the survey was conducted in May, and items
classed as either favorable or issues/requests were as follows.
<Favorable>■ The Board of Directors has atmosphere that actively listens to
the opinions of outside directors, and that emphasizes active
discussions.

Yokowo 2022 Integrated Report34

ESG Report<Issues/requests>■ The Company should ensure more diversity in the compositionof the Board of Directors in terms of gender, nationality, age,and other backgrounds.
■ The Company should ensure a sufficient number of
independent outside directors who are qualified to contributeto enhancing corporate value over the medium to long term.
■ Agenda items have increased at Board of Directors meetings,
but require more in-depth discussion.
In general, the effectiveness of the Company's Board of
Directors was determined to be sufficient, but we will work tofurther improve effectiveness by addressing issues, including
those above.

Director and Executive Officer
Compensation
Policy on Determining Director and Executive
Officer Compensation
With regards to compensation for the directors of the Company,
an upper limit for the total compensation in each fiscal year
is set by resolution at the General Meeting of Shareholders.
Compensation for individual directors is then determined by aprocess whereby the Nomination and Compensation Advisory
Committee receives a request for consultation from the Boardof Directors, and then deliberates and decides on proposals
regarding the amount to be paid to individual directors before
reporting to the Board of Directors, which then makes the
final decision, while respecting the reports received from theCommittee to the utmost possible extent.
In the same way, with regards to compensation for theauditors, an upper limit for the total compensation in each fiscal
year is set by resolution at the General Meeting of Shareholders.
Individual compensation is then determined within the boundsof the upper limit through consultation with auditors.

Compensation for Directors
Compensation for the Companyʼs directors consists of fixedmonthly compensation, a monetary executive bonus, and a sharebonus in the form of stock options, etc.
Based on guidelines that take into account individualsʼ roles
and responsibilities, the Representative Director, President and35

Yokowo 2022 Integrated Report

Executive Officer draws up a proposal regarding the amount of
fixed compensation after taking into consideration the businessresults of the previous fiscal year, the management plan of
the current fiscal year, and the roles of each director, etc. A
request for consultation is submitted to the Nomination andCompensation Advisory Committee, and then reported to theBoard of Directors, which deliberates on the matter and makes
the final decision.
Executive bonuses are paid based on their extent to whichinternal Executive Directors' performance targets have been
met to enhance their motivation for improving the Companyʼs
performance in each (consolidated) fiscal year. The three indicesof consolidated sales, consolidated net sales, and profit (loss)
attributable to owners of parent ("three indices") are used as
performance targets.
Regarding the question of whether executive bonuses arepaid, and the total amount paid, the Representative Director,
President and Executive Officer draws up a proposal based on theextent to which the relevant three indices have been achieved ineach (consolidated) fiscal year. If it is determined that executive
bonuses will be paid that year, the Representative Director,
President and Executive Officer draws up a proposal regarding
the amount to be paid to each individual based on the roles
and results of each individual executive director (including theircontributions to solving sustainability issues). The proposal for
consultation is submitted to the Nomination and Compensation
Advisory Committee, and then reported to the Board of Directors,
which deliberates on the matter and makes the final decision.
With the aim of sharing value with shareholders whileproviding increased incentive to build corporate value overthe medium to long term and enhance shareholder value,stock options are granted to executive directors. However, thedecision as to whether to grant stock options, and the period,is determined after comparing the impact of the necessary
expenses on performance with the anticipated incentive effect.
The Representative Director, President and Executive Officer
draws up a proposal regarding the amount of stock options tobe granted to each individual executive director based on theroles and results of each individual executive director, within theupper limit (in terms of the value of shares or number of shares)
set by the Shareholders Meeting. A request for consultation
is submitted to the Nomination and Compensation Advisory
Committee, and then reported to the Board of Directors, which
deliberates on the matter and makes the final decision.

As a general rule, internal directors are obliged to contributea certain amount or more of their basic compensation to the
Executive Shareholdersʼ Association every month as stipulated
by internal rules. Yokowo shares accumulated by the Executive
Shareholdersʼ Association shall be transferred under the nameof the individual executive directors every six months (in late
September and late March).
In principle, Directors shall hold their shares and not sell themwhile holding their position of director.
Regarding the ratio of executive directorsʼ overall
compensation to be held by each category of compensation, thisshall be determined based on the roles and responsibilities ofeach executive director and on trends in compensation at othercompanies with a similar scale of operation to Yokowo. In thecase where stock options are granted up to the specified upper
limit, the target ratios for each of the categories of compensation
are: basic compensation: 60%; performance-linked compensation:
20%; compensation in the form of shares: 20%.

of each auditor and based on guidelines stipulated in advance.
In the event of bonuses to auditors, these are paid after
approval at the General Meeting of Shareholders.
▼ Compensation Figures(million yen)

Fiscal 2021
Upper Limit(annual)Basic
compensation

Executive
bonus

Compensationin the form ofshares

Total

Directors(outside)

280
(20)

165
(15)

48
(―)

―
(―)

213
(15)

Auditors(outside)

40

37
(15)

―
(―)

―
(―)

37
(15)

Total
(outside)

320

202
(31)

48
(―)

―
(―)

250
(31)

Company Officers Skill Matrix
Among the various areas of expertise and experience possessedby each current Director and Member of the Audit & Supervisory
Board, up to three items are listed for which there are particularly
strong expectations regarding that individualʼs ability to utilize
these items effectively in the performance of their duties. The tablebelow thus does not show the entirety of the specialist experienceand experience of each individual.

Compensation for Auditors
Compensation for auditors is limited to basic compensation,
which comprises monthly compensation in monetary terms.
The amount of basic compensation is determined bydiscussion among the auditors at the Audit & Supervisory Board
meeting taking into consideration the roles and responsibilities▼ Company Officers Skill Matrix
Specialist Expertise and Experience
Name

Takayuki Tokuma
Koichi Fukagawa
Kenji Yokoo
Naohito Odani

Corporate
management

ESG andsustainability

Representative Director,
President and Executive Officer
Director, Senior Managing
Executive Officer
Director, Managing Executive
Officer
Director, Managing Executive
Officer

〇

〇

〇

〇

〇

〇

〇

〇

Kuniko Muramatsu Outside Director
Makoto Tobari
Kenji Kamachi
Toshiaki Tochigi
Hisao Tsunoda
Emi Yoneda

Legal affairs
and riskmanagement

Position

Outside Director
Audit & Supervisory Board
MemberOutside Audit & Supervisory
Board Member
Outside Audit & Supervisory
Board Member
Outside Audit & Supervisory
Board Member

Finance and
M&A

Human
resources andlabor affairs

〇

〇

〇

〇
〇

〇

〇

〇

〇

〇
〇

〇

〇

〇

〇
〇

Internationality〇〇〇

Technologicalstrategy

〇
〇

〇
〇
〇

〇
〇

〇

Yokowo 2022 Integrated Report36

ESG Report

Directors, Auditors and Executive Officers

Sustainability Promotion Framework

Board of Directors

We are conscious of our corporate social responsibility. As such, Yokowo is constantly striving to improve ourcorporate value as well as establish a sustainability promotion framework, and we will expand our corporate activities
to both meet the expectations of all stakeholders and to earn their trust.

(As of June 28, 2022)

Establishment of Sustainability
Committee
Takayuki
TokumaKoichi
Fukagawa

Kenji
Yokoo

Naohito
Odani

KunikoMuramatsu

MakotoTobari

Representative Director,
President and Executive
Officer

Director,
Senior Managing Executive
Officer

Director,
Managing Executive
Officer

Director,
Managing Executive
Officer

Outside Director

Outside Director

Attendance rate at Boardof Directors Meetings:
18/18 times (100％)
Number of Company
shares held:
288,178 shares

Attendance rate at Boardof Directors Meetings:
18/18 times (100%)
Number of Company
shares held:
51,668 shares

Attendance rate at Boardof Directors Meetings:
18/18 times (100%)
Number of Company
shares held:
90,128 shares

Attendance rate at Boardof Directors Meetings:－ (New appointment)

Attendance rate at Boardof Directors Meetings:
17/18 times (94%)
Number of Company
shares held:
0 shareAttendance rate at Boardof Directors Meetings:－ (New appointment)

Number of Company
shares held:
7,600 shares

Number of Company
shares held:
0 shareAudit & Supervisory Board Members

In October 2022, we decided to establish a Sustainability
Committee to act as a body to comprehensively address thethree materialities identified by the Group — Environment,
Community, and Diversity and Inclusion.
This Sustainability Committee is tasked with formulating
policies aimed at achieving the goals of these materialities andissues with implementation, and with reporting and sharing
information regarding the status of Group initiatives towards
sustainability to the Board of Directors.

and suggestions from the Board of Directors to relatedorganizations → further improve initiatives” in 2 above, alongwith decisions made by the Board of Directors.

Themes handled by the Sustainability
Committee, and Outline
Theme

OutlineEnvironment

Deliberation, planning, and progress
management of measures towards achieving
the targets of the Group GHG emissions
reduction, water resource, waste recycling, andbiodiversity

Human Rights
Protections

Formulation of draft policies, deliberation, andprogress management for the protection ofhuman rights in the Groupʼs supply chain

Local Communities

Deliberation and progress management of2030 targets (numbers of projects contributing
to local communities, etc.), and support forreviewing of action plans

Diversity andInclusion

Deliberation and progress management of2030 targets (increasing ratio of female leaders,
number of TISP hires, etc.), and support forreviewing of action plans▼ Sustainability Committee Framework
Board of Directors
Reporting of ESG themes, etc.

Opinions anddecisions on reports

Sustainability Committee

Kenji
KamachiToshiakiTochigi

Hisao
TsunodaEmi
YonedaAudit &
Supervisory Board Member

Outside Audit &Supervisory Board Member

Outside Audit &Supervisory Board Member

Outside Audit &Supervisory Board Member

Attendance rate at Boardof Directors Meetings:－ (New appointment)

Attendance rate at Boardof Directors Meetings:
17/18 times (94%)

Attendance rate at Boardof Directors Meetings:－ (New appointment)

Attendance rate at Boardof Directors Meetings:－ (New appointment)

Attendance rate at Audit& Supervisory Board
Meetings:－ (New appointment)

Attendance rate at Audit& Supervisory Board
Meetings:
16/17 times (94%)

Attendance rate at Audit& Supervisory Board
Meetings:－ (New appointment)

Attendance rate at Audit& Supervisory Board
Meetings:－ (New appointment)

Number of Company
shares held:
1,251 share

Number of Company
shares held:
0 shareNumber of Company
shares held:
0 shareNumber of Company
shares held:
0 shareChairperson
President and Executive Ofﬁcer
Secretariat

Committee Members(Senior Managing Executive Ofﬁcer,
Managing Executive Ofﬁcer)

ObserverTakayuki Tokuma

Executive Officer cum Deputy Chief Officer,
Technical H.Q. cum General Manager,
VCCS Engineering Management Division

Senior Managing Executive Officer

Tsuyoshi Sakata

Koichi Fukagawa
Managing Executive Officer

Kenji Yokoo

Executive Officer cum Chief Officer,
Quality Assurance H.Q.

Masaki Shimizu

Managing Executive Officer cum General Manager,
Technical H.Q.

Executive Officer cum Chief Officer,
Purchasing H.Q. cum General Manager,
VCCS Manufacturing Department

Naohito Odani

Yoshiro Furumi

Managing Executive Officer cum General Manager,
VCCS Overseas Plant

Executive Officer cum General Manager,
FC Business Division

Katsuhei Yanagisawa

Motoaki Matsuura

Managing Executive Officer cum General Manager,
Tomioka Plant

Executive Officer cum General Manager,
CTC Business Division

Mitsuaki Okazaki

Naoki Kawata

Executive Officer cum Chief Officer,
Management Planning H.Q.

Tatsuo Tsunoda
Executive Officer cum Chief Officer,
Core Technology Development H.Q.

Tomohisa Hoshino
Executive Officer cum General Manager,
MD Business Division

Koichi Tachikawa
Executive Officer cum Chief Officer,
SCI (Sustainability & Corporate Integrity) Promotion
H.Q. cum General Manager, Sustainability Promotion
Department cum General Manager,
Corporate Secretary Department cum General Manager,
Public Relations & Equity Department

Toshihisa Tagaya

Collaboration with the Information Security
Committee regarding information security
activities based upon ISO 27001

Occupational Healthand Safety

Collaboration with the Health and Safety
Promotion Committee regarding occupational
health and safety activities based upon ISO
45001

Treatment of
Employees

Issues related to reforms in the personnel
system (transition to a job-based personnel
system, improved treatment, etc.) and thewelfare system in general

Fair Trade

Issues related to status of compliance with laws,
regulations, and internal rules concerning fairtrade practices, and to the status of internal andexternal education in order to ensure thoroughcompliance

Risk Management

Collaboration with the Business Risk
Management Committee and each ISO Division
regarding progress and changes in measures tohandle each risk assessment item

Business Continuity
Planning (BCP)

Collaboration with each business division
regarding construction of BCP and its updates(Audit & Supervisory Board
Member, Outside Director)

Executive Officers
President and Executive Officer

Information Security

Role of Sustainability Committee
1. To prepare and review draft sustainability policies andmateriality policies in light of factors such as the Group
Corporate Philosophy structure and business environment.
(Decisions are made by the Board of Directors)
2. To receive reports from relevant internal organizations onmateriality and ESG-related themes, and to report and assist inreporting to the Board of Directors.
3. To disseminate information accumulated from the cycleof “report to Board of Directors → disseminate opinions* For details regarding the reasons for appointment of individual Directors and Audit & Supervisory Board
Members, please visit our official corporate website.
https://www.yokowo.co.jp/english/company/csr/governance.html

37

Yokowo 2022 Integrated Report

Yokowo 2022 Integrated Report38

ESG ReportCompliance and Risk Management

Information Security

In accordance with the CSR Code of Conduct, the Yokowo Group will comply with laws and regulations in good faithand engage in fair corporate activities on a daily basis, and will also fulfill the social responsibilities of a corporation
by responding appropriately to risks through our Risk Management System and efforts to continuously improve ourrisk management performance.

In our current networked era, we are seeing increasing worldwide demand for strengthened information security.
The Yokowo Group constantly recognizes the importance of all the information assets and we promote information
security activities globally to meet these requirements.

Approaches to Compliance
The Yokowo Group will contribute to the development of asustainable society by engaging in activities that impact on theeconomy, the environment, and society in a transparent andhighly ethical manner in order to earn the trust of stakeholders
with the constant aim of enhancing corporate value.

Initiatives to Improve ComplianceTo ensure compliance, the Yokowo Group works to firmly
establish the CSR Code of Conduct, which sets out the actions to
be taken by the Groupʼs officers and employees, and distributes
it as a leaflet in Japanese, English, or Chinese that can be carriedaround easily, to make all officers and employees familiar with its
content. Additionally, to further raise awareness of compliance,along with conducting e-learning programs for managers inJapan, China, Hong Kong, Vietnam, and Malaysia, we havealso equipped an internal reporting system at Yokowo and at
subsidiaries in Japan and overseas. We are also using an external
hotline to promptly detect and correct any violations of laws andregulations. Furthermore, under the CSR Code of Conduct, wehave established and started utilization of regulations compliant
with anti-bribery regulations in each country.
Furthermore, the Internal Audit Department audits businessprocesses in each department at Yokowo and at subsidiaries
in Japan and overseas, providing guidance on detecting andpreventing misconduct and improving processes.
In FY2021, there are no compliance violations.

Aware of the potential impact of risk on our business activities,
besides complying with relevant laws and regulations, theYokowo Group also strives to fulfill our social responsibility andput organizational operation on a stable footing by responding
appropriately to risk, through measures to continually
improve our risk management systems and risk management
performance.

39

Yokowo 2022 Integrated Report

Approaches to Information Security

The Yokowo Group has established and maintains the Risk
Management System (RMS), which conducts identification,
analysis, planning, implementation, evaluation, improvement,
and review for diversifying loss risks in order to ensure morestable and smoother business activities. Under the Risk
Management Rules, we have established risk management
policies and risk management guidelines, and we are striving tocontinually enhance the RMS.
We are also working to identify risks at an early stage,
share and analyze them and to formulate and implement
countermeasures, with the establishment of the Business Risk
Management Committee (see the Corporate Governance pageon p. 34).

The Yokowo Group aims to ensure that it always recognizes
the importance of all information assets handled thereby,
including information provided by its customers and business
partners, in order that the Group may continue to be a trusted
member of society. To this end, the Group has stipulated andimplemented its Information Security Policy in order to prevent
all improper disclosure, divulgence, and unauthorized use ofsuch information assets.

Information Security Policy (Overview)
1. Compliance
2. Framework
3. Management of Information Assets
4. Training
5. Preventing and Responding to Incidents

and is working together with the entire Group to advance its
information security activities.

Information Security Education
The Group considers the basis for information security to be foreach employee to have a high level of awareness with regard
to information management, and works to keep all officers andemployees (including temporary staff) well informed regarding
laws and regulations as well as corporate policy and rules, etc.
governing information security.
Furthermore, Yokowo implements various activities in order
to increase awareness of information management, such as
carrying out yearly e-learning sessions on information security,and issuing all employees with an Information Security Handbookthat details practices which should be followed during the courseof everyday duties.

Enacted: April 1, 2013

▼ Schematic diagram showing the internal whistleblowing
systemContact points for reports andrequests for consultation* The full text of the Information Security Policy can be viewed on the
Yokowo website.
https://www.yokowo.co.jp/english/company/csr/security.html▼ Information Security Management Framework
Responsible department within
the Company

External consultation window

Chief Information Security Officer, as CISO
Demonstrating concern for
the feelings of the reporting party

Clarifying the reporting
party’s intent

Collating the issues
Support for exploring solutions

Investigations and interviews▼ ISO 27001 Certification Status
2014

YOKOWO CO., LTD., 3 Japanese subsidiaries

2016

Chinese subsidiaries (3 locations)

2017

Malaysia subsidiary

2021

German subsidiary2021

Vietnamese subsidiary

Chairman, Information Security Committee

Information Security Officer

Consultation
with external
experts

Clarifying the reporting
party’s intent(1) Handling the matter outside the Company(2) Submitting a non-anonymous report to
the Company(3) Submitting an anonymous report to theCompany
Where the reporting
party does not wish
to have the matterhandled by theCompany

Selection of a strategy for resolving
the issue based on the reporting
party’s own insights

Where thereportingparty wishes
to have thematterhandled by theCompany

Examination to resolve the issue
and/or decision on disposition by
the Rewards and Penalties Committee

Resolving the issue

Approaches to Risk Management

Initiatives to Improve Risk
Management

Secretary General, Information Security Committee

Information Security Manager

Information Security Committee Office

General Managers, Chief Officers,
Managing Directors

Assigned by CISO

Information Security Administrator

Yokowo CSIRT

Assigned by General Managers, Chief Officers,
Managing Directors

Assigned by CSIO

By Business Div., Headquarters, Department, Section

Assigned by all companies

Enhancement of Information Security
Reoccurrence prevention
and follow-up

Under the Groupʼs Information Security Policy, Yokowo
recognizes the management of information security as oneof the most important issues in business management. In
order to manage the information assets appropriately, it hasconstructed an information security management system (ISMS),

Protection of Confidential Information
Under its Information Security Policy, the Group has establishedconfidentiality rules for the protection of confidential information,and disseminated these to the Group and all suppliers, etc. engaged
in Yokowoʼs business. Through compliance with these rules,
Yokowo handles and protects, both strictly and appropriately, allinformation assets possessed by Yokowo, and information disclosed
to it by its customers. In addition, it is our social responsibility topromote cyber security measures not only within our group but
throughout the supply chain as a whole, and as such we areworking to confirm and enhance the status of security measuresat our suppliers and sub-suppliers. As of April 2022, Yokowo has
decided to prohibit the use of password-protected compressed
files. In FY2021, there were no specific complaints regarding either
violations of customer privacy, or losses of customer data.

Yokowo 2022 Integrated Report40

ESG Report

Environment
The Yokowo Group recognizes that conducting business activities in harmony with the global environment isan essential responsibility for a corporation. The Yokowo Group continues to implement a range of Group-wide
environmental preservation activities and address climate change based upon defined environmental policies in orderthat we can pass on our irreplaceable global environment to future generations.

Approaches to the Environment

Environmental Policy
Today, when Japan and the rest of the world
are starting to make a serious effort torealize carbon neutrality by 2050, Yokowo
is also responding to the demands of our
stakeholders and society by formulating
more concrete measures to address climatechange, and working actively to implement
them. Reflecting this stance, we support therecommendations of the FSB Task Force on
Climate-related Financial Disclosures (TCFD),
and we are implementing specific initiatives
to achieve the target of reducing greenhousegas emissions from our plants (Scope 1 and 2)
by 35% by FY2030, compared to FY2014, andpromote specific climate-related information
disclosure.
Yokowo is also committed to helping
to create a rich natural environment. We
seek to do this through our environmental
management system and through activities
designed to achieve continuous improvements
in environmental performance. As part of ourcommitment, we take into consideration theenvironmental impact of our business activities
and comply with all relevant environmental
laws, regulations, and guidelines, as well aswith each customerʼs specific guidelines.

Action Guidelines
1. Yokowo supports the TCFD recommendations, and besides formulating
and implementing concrete measures to achieve the target of reducing
greenhouse gas emissions at our plants (Scope 1 and 2) by 35% by
FY2030, compared to FY2014, we will also be disclosing details of
the measures taken, through the Carbon Disclosure Project (CDP)
framework.
2. Yokowo will continuously and actively promote energy saving, resource
conservation, and recycling to contribute to the protection of the
global environment.
3. In respect of chemical substances which are harmful to both theenvironment and human body, Yokowo will prevent environmental
pollution by implementing preventive measures and action plan, which
include those for the case of abnormal and emergency operation, andwill minimize the use of hazardous chemical substances.
4. Yokowo will comply with all relevant environmental laws, regulations,and each customerʼs specific requirements, and intend to enhance ourenvironmental management by our original internal standards.
5. Yokowo will set objectives and goals for our environmental activities
and also improve our environmental management system continuously
by periodically reviewing the objectives and goals.
6. Through in-house education and publicity, Yokowo will promote all theemployeesʼ recognition of involvement in environmental preservation
and will make these activities take root as daily duties.
7. Yokowo ensures that all the employees including those of affiliatedcompanies are fully aware of the environmental policies, and will
disclose them to the public on request.
8. Yokowo will contribute to the development of a sustainable society byconsidering the impact on biodiversity in all its business activities.

Addressing Climate ChangeWith the aim of reducing direct greenhouse gas emissions(Scope 1 and 2), Yokowo is drawing up plans for the adoptionof renewable energy at our plants in Japan (in Tomioka City,
Gunma Prefecture), China, Vietnam, and Malaysia, which are ourCompanyʼs main sources of greenhouse gas emissions. In October
2022, we installed a photovoltaic power generation system at ourVietnam Plant using a bilateral credit system.
Regarding the reduction of Scope 3 greenhouse gas emissions,as most of the employees at the Tomioka Plant currently commute
to work by car, we are implementing a plan to persuade a local
railway company to establish a station near the plant, so that
employees will be able to commute to work by train, and weare also planning to establish charging points for electric vehicles
at the plant. Through the implementation of these concrete
strategies, we are aiming, initially, to secure a “B” evaluationfrom the CDP. We will be steadily disclosing details of theimplementation status of these concrete measures through the
CDP platform, and also on our Company website.
As of 2020, the Yokowo Group had implemented a variety ofactivities directed towards meeting the goal of a year-on-year 1%
reduction in the greenhouse gas (GHG) emission factor.
We are currently still in the process of collecting data regarding
greenhouse gas emissions in 2014—the base year for determining
greenhouse gas emissions reduction—and will disclose thisinformation once the calculations have been completed.

galvanization processes, and have achieved zero emissions into
public waterways.
▼ Water usage and usage rates
Water usage (m3)

Usage rate (water usage / sales)

350,000
6.389

337,500

335,868

344,6328

331,726

312,500
300,000

4

283,178

287,500
275,000
250,0002017■ Water usage

2018

2019
Usage rate

2020

1,400

20,000

Enacted: June 1, 2005 Revised: October 15, 2021

0.334

21,104

20,156
20,361

20,22220,007

0.316

0.3
0.2

18,000

1,200

1,052

1,150

Recycling rate (%)*2
87.1
85.2
90

1,249
1,056

1,111

1,000

Environmental Management Systems
ISO 14001 Certification
Since its individual production bases received ISO 14001
certification starting in 1998, the Yokowo Group has continued
to work in environmental activities. In FY2021, indicated by an
external audit, the Group has taken appropriate measures suchas upgrading to septic tanks with higher performance.
* Please see our website for more details on the status of ISO14001
Certification Acquisitions.
https://www.yokowo.co.jp/english/company/csr/environment.html

41

Yokowo 2022 Integrated Report

Issues and Results of Activities
The Yokowo Group identified four issues that need effort—
addressing climate change, management of water resources,
resource recycling, and zero hazardous chemical substances usage.
For these issues, Yokowo sets annual goals and activities to beachieved. At a meeting of the Board of Directors held in October
2021, it was decided that Yokowo would express its support for
the recommendations of the TCFD, and revisions were made to theCompanyʼs Environmental Policy and Action Guidelines.
In July 2022, the status of these efforts was disclosed through
CDP.

0.1

14,000

0.0

56.4

600

2017
2018
2019
2020
Emission factor■ CO2 emissions

2021
(FY)

*1 Electricity CO2 conversion factor is calculated using the following:
Domestic: TEPCO Energy Partner, Inc Basic Emission Factor
Overseas: IEA Official Factor

70
50

59.4

53.8

40
30
20

200
0

80
60

800

400
16,00002021

The Yokowo Groupʼs main products are electronic components,
and the main types of waste that we generate are metal andplastic waste, and waste cutting oil, that are generated during the
production processes. With regard to these main types of waste,
we are working to conserve resources. As well as promoting a
reduction in the quantities of waste generated by our businessactivities, we have also set a recycling rate of at least 80% as atarget. The inclusion of Yokowo Vietnam in the data aggregationfrom FY2020 onwards has led to a substantial increase in therecycling rate.

0.5
0.4

1

Resource Recycling

Waste (t)

0.334

2

(FY)

Emission factor (CO2 emissions/sales)

22,0003

260,179

262,500

CO2 emissions (t)*1

0.372

5

3.892

▼ Quantity of waste and recycling rate

0.388

6

4.722

6.134

▼ CO2 emissions and emission factor
24,0007

5.687

325,000

102017■ Waste2018
2019
Recycling rate

2020

2021

0

(FY)

*2 The recycling rate is the share of waste handed over to recycling firms.
We are experimenting with the use of recycled plastic in plastic molding
processes. We are also working on the development of original recycling
technology for cutting oil, in collaboration with a local vocational college.

Management of Water Resources
Of the water used within the Yokowo Group, the majority is fordomestic-type uses; because of the characteristics of our products,
hardly any water is used in the production processes. We areworking to achieve our goal of a year-on-year 1% reduction inwater consumption, measured by per unit of sales.
Additionally, we are monitoring the quality of plant
wastewater using our internal standards, which are more rigorous
than legal requirements. At the Tomioka plant, we are recovering
all hazardous chemical substances in discharge from our

TopicsIn July 2022, we received third-party certification (scope
1 and 2) for greenhouse gas emissions. In the future, wewill expand the scope of monitoring of our greenhousegas emissions, and ensure this information is disclosed tothe public.

Yokowo 2022 Integrated Report

42

ESG Report

Employees
The Yokowo Group aims to promote and advance diversity and inclusion among our employees and strives to create arewarding and attractive workplace environment with the aim to “Be a company where employees feel comfortablebeing employed, and which ensures that employeesʼ families are happy for them to work there.”

Holding Roundtable Meetings to Further
Improve the Workplace Environment

Basic Data on Employees▼ Number of Employees
Yokowo total

Asia

8,499

1,322

79

7,098

Vehicle Communication Equipment

6484

253

51

6180

Circuit Testing Connectors

816

322

15

479

Personal Communication Equipment—Fine Connectors

446

77

11

358

Personal Communication Equipment—Medical Devices

273

272

1

0

Other employees

480

398

1

81

Total employees (persons)

Breakdownbybusiness segment

Europe andthe U.S.

Japan

Composition of Employees
The main production bases in each segment are China andVietnam for the Vehicle Communication Equipment segment,
Malaysia and Japan for the Circuit Testing Connectors segment,
Malaysia and China for the Fine Connector business in the
Personal Communication Equipment segment, and Japan for
the Medical Device business in the Personal Communication
Equipment segment. Our production bases are concentrated
in Asia. In particular, there are a large number of employees in
China and Vietnam, which are production bases for the Vehicle
Communication Equipment segment.

▼ Recruitment and Turnover
YOKOWO CO., LTD.

88

New recruitment
Male

Total

74

FemaleTotal

14

Number of job leavers

Yokowo is holding roundtable meetings to clarify issues in ourorganizational culture and systems, to build and strengthen
specific improvement measures and systems, and to share themamong employees in order to realize a rewarding and attractive
workplace environment. The roundtable meetings are held with
employees divided according to eight attributes to stimulate
discussion within each attribute and ensure the identification ofareas for improvement in the current situation at Yokowo. We
intend to use the identified areas when we revise the personnel
system and other systems in the future.
In FY2021, a list of employee opinions was made available
throughout Yokowo, and necessary improvements are being
made as needed. Looking forward, Yokowo will continue tohold round tables to take on board multiple opinions, aiming tobetter create a "good company."

1Female62

Non-Japanese

7

Total

20

Female

Total

0

3
4
5

Young employees in their first
three years at the Company
Mid-career employees intheir 30s
Employees raising children

89

At the beginning of each fiscal year, every employee preparesa job description in consultation with their superiors which
includes their duties and goals, and carries out their duties.
Superiors evaluate employee performance every six months andhold interviews to provide feedback on the results to employees.

Human Resources Development▼ Roundtable Meeting Attributes

20

Male

Performance Evaluation

Specialists (employees withspecific qualifications)
Production line employees andsupervisors
Veteran employees aged 55 andolder

We have established an “integrated human resource
development system starting with new employees” in order tocultivate “globally-minded human resources” who will support
the full-scale globalization of our business and to actively
promote the strengthening of management at all levels. In
addition to training that is common to all employees, we provide
diverse position-specific and specialty training to encourage
employee growth.
In the future, Yokowo will create a “new training system” tobetter support employeesʼ independence in their skill and careerdevelopment, and aim to become a company that can provide
more specialized training opportunities to employees.

Roundtable suggestion box*

* We have set the “Roundtable suggestion box” on the Company intranet
as an opportunity to enable employees with opinions to speak out freely.
The opinions we collect will be used to initiate new roundtable meetings
depending on the content.

Work-Life Balance▼ Conceptual Diagram of Training System

Other work-life balance measures

Use of childcare leave
Yokowo has established a childcare leave system to support
employees in balancing work with childcare. In FY2020, four
female employees took childcare leave.

■ Hourly paid leave■ Special COVID-19 vaccination leave

New general manager training

Deputy General
Manager

New deputy general manager training

Manager

New manager training

Assistant Manager

Mid-career employee (leader) training

MemberYoung employee training

Induction

Self-education

43

Yokowo 2022 Integrated Report

Next-generation leader
selective training

Sales
department
training

Technology
department
training

Production
department
training

Administration
department
training

Tentative assignment/basic training

Self-education
Online education (position-specific) andlanguage training* Number of annual paid leave days taken ÷ number of annual paid leavedays newly granted each fiscal year

General manager

Common training
Training on current affairs

Yokowo has established a nursing care leave system to support
employees in balancing work with nursing care. In FY2020, twoemployees took nursing care leave.

Specialty training

Global adaptation training(cross-cultural adaptation, etc.)

We promote the use of annual paid leave aiming for an annual
paid leave utilization rate* of 70%, which is the target for
FY2020. In FY2020, the annual paid leave utilization rate was
65.2%.

Position-specific training

Non-management
position

Use of nursing care leave
Management
position

Percentage of annual paid leave taken

Online education (support for occupational training and acquisition of qualifications)

Yokowo 2022 Integrated Report

44

ESG Report

Diversity
Through the promotion of diversity and inclusion, the Yokowo Group is promoting the recruitment and developmentof human resources without regard to nationality, gender, or age, with the aim of becoming Team Yokowo, a“sustainably evolving company.”

Approaches to Diversity
The Yokowo Group hires and trains diverse human resources,
irrespective of nationality, gender, or age, and strives to create
an employee-friendly workplace where there is respect forindividuality and fair and equitable treatment to enable each andevery employee to achieve their full potential.

our organizational culture are hindering active participation
by women, and how to make improvements. Results of thisgathering of information showed that tasks such as greeting
visitors have traditionally remained the role of female employees,
and so we are reviewing the nature of this work and considering
remedial measures, and also working to bring about a genderneutral work style and culture.
▼ Percentage of female employees★
(persons)

906

1,000

Concrete Measures Relating toDiversity
The Yokowo Group treats “diversity and inclusion” as one of ourmanagement strategies. We are striving to become a company
where employees with the diverse values of global Yokowo areable to come together and work together on a global basis toachieve their full potential. In terms of diversity, we are steadily
promoting measures based on the TISP Project to expand thefield of activities of non-Japanese employees. However, there arestill many issues to be addressed in increasing the ratio of female
leaders and the ratio of employees with disabilities.
In 2021, the revised Child Care and Family Care Leave Act
was enacted, requiring companies to encourage male employees
to take childcare leave. However, it is necessary clarify the issues
involved for this measure to become established at Yokowo.
In order to clarify these issues in our organizational culture andsystems, and to share the direction for improvement and reform,
Yokowo is holding “roundtable meetings” (see the Employees
page on p. 44) where the employees concerned can frankly
exchange opinions and reflect them in changes to the humanresources system and in management.

Promoting Active Participation by Women
Due to the fact that Yokowo is a manufacturing company, thenumber of permanent female employees hired is small, andthe ratio of female leaders is currently lower than that of male
employees due to the small pool of female employees. However,our goal is to increase the ratio of female leaders to at least thesame as that of male leaders. To achieve this goals, we havestarted to appoint women as outside directors and promoting
them to management positions. At the same time, Yokowo
has held a roundtable meeting on womenʼs active participation(with female employees) as a place to discuss what aspects of

800
600

839

817

769

15.1

（％）

960

16
12

11.3

11.1

10.7

10.5

8

400
200

3.1

2.6

1.3

3.1

2.2

4

Promoting Active Participation by Senior Human
Resources▼ Changes in new graduate hires and mid-career hires★

In addition to the existing system of re-employment (reemployment after transfer to an affiliated company), we
established a new system to extend employment after retirement
at the age of 60 as permanent employees at our Head Officein 2020 in order to promote the active participation by seniorhuman resources. This is subject to approval by the Personnel
Committee if the Company deems it necessary and the employee
agrees to do so for the purpose of transferring technology toyounger employees or utilizing proprietary technology andknow-how.
This system also allows those who are 65 years old or older tocontinue to playing an active role under an outsourcing contract
or consultant contract if the Company deems it necessary andagrees with the individual.
Furthermore, we hold roundtable meetings for senior humanresources to further improve the system while incorporating theopinions of the people concerned.

(Person)▼ Number of older employees re-employed★
(persons)

40
0

2017

2018

2019

Number of YOKOWO CO., LTD. employees

2020

2021

34

0

(FY)
Percentage of female managers*1

30

30

Percentage of permanent female employees*2*1 Female managers at end of fiscal year ÷ executive and management positions
at end of fiscal year (includes assistant managers, excludes specialists)

20*2 Number of female employees at end of fiscal year ÷ number of full-timepermanent employees at end of fiscal year10★: YOKOWO CO., LTD.

Employment of People with Disabilities
Yokowo is a manufacturing company focusing on microprecision processing. As such, we have not made progresson hiring people with disabilities, and we have not met thelegally mandated employment rate. Nevertheless, from theperspective of the SDGs, we have set a goal to at least double
the employment rate of people with disabilities compared to
the legally mandated rate. In order to achieve this goal, we
determined the need to develop both tangible and intangible
company-wide infrastructure and development of jobs thatwould enable people with disabilities to play active roles, andset up the “Project Team for Establishing a Special Subsidiary.”
The immediate goal is to establish a special subsidiary in FY2022
and build a system that will stably meet the legally mandated
employment rate for people with disabilities.

0

19

22

11

2017

2018

2019

2020

2021

（FY）

★: YOKOWO CO., LTD.

Strengthened Mid-career Hiring
The Yokowo Group corporate vision incorporates the message
that “as Team Yokowo, by creating new products thatincorporate cutting-edge advancements based upon the Groupʼs
proprietary technology, we want to be a company that while
evolving, achieves persistent growth.”
The Yokowo Group in principle enhances our workforce
by hiring new graduates, however recent years have seen an
increase in the ratio of mid-career hires supported by strong
business performance. We are bringing together all employees
who sympathize with this message, regardless of new graduate
or mid-career hires, irrespective of gender, age, or nationality.

60

60
50

49

45

40

20

30

29

30

18

20

18

2018

2019

28

22

10
0

2017

New graduate hires

2020

Mid-career hires

2021

（FY）

★: YOKOWO CO., LTD.

TISP ProjectAt the Yokowo Group, we are promoting the “TISP (Tomioka
International Specialist Park) Project” as a central part of ourdiversity and inclusion initiatives.
This project brings together specialists from around theworld (in product design, production engineering, elemental
technologies, quality assurance, production control, etc.)
to our main plant—the Tomioka plant (Gunma Prefecture).
Hiring criteria place no particular requirements as regards
Japanese conversational ability, and have a focus on expertisefor midcareer hires, and potential for new graduates. Looking
forward, we aim to bring together 120 foreign specialists
centered around the Tomioka plant.
With this project, we are actively recruiting foreign employees
living in Japan, and those living overseas. In particular at our
main production bases in China, Vietnam, and Malaysia, we havein place a multi-year training program in Japan for new graduate
hires who have graduated from local universities in thosecountries. For these trainees, we create an individualized CDP(Career Development Plan) with which we provide systematic
human resource training, and many of the trainees who havecompleted their training in Japan return to work in their own
countries.
▼ Changes in TISP human resources★
(Person)

66

70
60

61

61

54

50
40
30

31

20
10
0

2017

2018

2019

2020

2021

（FY）

★: YOKOWO CO., LTD.

45

Yokowo 2022 Integrated Report

Yokowo 2022 Integrated Report46

ESG Report

Occupational Health & Safety: OH & S

Procurement

The Yokowo Group positions the management of health and safety of its employees as well as stakeholders in theGroupʼs activities as the top priority issue for its management, and will pursue a workplace where they are able to workwithout undue concern by always securing their safety, and that will strive to promote their mental and physical health.

The Yokowo Group strives to engage in fair and equitable transactions with suppliers, and we are focused onbuilding equal partner relationships. We are working to transform our system away from a passive procurement
function towards more dynamic procurement.

Approaches to Occupational Healthand Safety
The Yokowo Group positions proper management of the safety,
peace of mind, and health of employees and other stakeholders
as a number one priority. In order to safeguard every individual
employee—each of whom is vital to the Groupʼs business
continuity and growth—we have formulated the Occupational
Health and Safety Policy, and we promote occupational healthand safety activities on the basis of this policy.
* Please see our website for more details on the Occupational Health and
Safety Policy of the Yokowo Group.
https://www.yokowo.co.jp/english/company/csr/safety.html

Occupational Health and Safety Framework
Yokowoʼs Health and Safety Promotion Committee meets on amonthly basis. The Committee is headed by senior management
and consisting of the OH&S managers and promoters of eachdepartment, who play a central role in practical health and safety
activities. The Committee strives to realize continued improvementof OH&S activities by sharing the progress made in individual
departmentsʼ OH&S action plans, the results of monthly OH&S
inspections, and details of occupational accidents and the remedial
measures taken. In addition, the Committee holds monthly meetings
to provide a venue for talks between its members, both from laborand management, with the participation of occupational physicians,
etc., as required by law. The Risk Assessment Committee evaluates
remedial measures when responding to unexpected occupational
accidents. It discusses and confirms whether the measures proposedby the department where the accident occurred are effective froman objective viewpoint, and whether there are any oversights inpreventing reoccurrence. In April 2021, the Occupational Health &Safety Section was established within the General Affairs Department(in April 2022, Environmental issues were added, and this was thus
reorganized to the Occupational Health, Safety, and Environment
Section). This new department aims to further expand measures that
contribute towards OH&S, with a particular focus on promoting theactivities of the various committees.
▼ Occupational Health and Safety Management Framework
Chief Occupational Health and Safety Management Officer
President & Executive Officer / General Manager, Tomioka Plant▼ Occurrence of Occupational Accidents Over the Past Three Years
FY2019FY2020

FY2021

Accidents withlost work days

0

2

3

Accidents without
lost work days

1

4

6

Total accidents

1

6

9

To Realize a Continued Improvementof Occupational Health and Safety
Yokowo has constructed an occupational health and safety
management system (OHSMS), and is working to advanceits OH&S efforts as the entire Group under the OH&S Policy.
YOKOWO CO., LTD., including the following subsidiaries, has
acquired “ISO 45001” certification, the international standard
for occupational health and safety management systems.
▼ ISO 45001 Certification Status

2020

YOKOWO CO., LTD., domestic subsidiaries(3 companies)
Chinese subsidiaries (2 locations)* OHSAS 18001 certification was obtained in 2016 in Japan and in 2017 in
China, however this was transferred to ISO 45001 certification in August
2020.

The Key Pillars of the Promotion of
Occupational Health and Safety Activities
The Yokowo Group has designated safety, health and workstyle as the three key pillars of the annual plan for promotionof occupational health and safety. Based on these three key
pillars, each department carries out occupational health andsafety activities systematically after setting its own targets andperforming risk assessment.

An energetic
workplace

Health and Safety
Promotion Committee

Besides striving to ensure fair and equitable transactions
with our suppliers, the Yokowo Group also aims to realize a
procurement function to purchase high-quality, reasonablypriced items from all over the world at the right time and in
the right quantities, while promoting proactive procurement
activities that contribute towards the Companyʼs profitability.
We not only comply with all relevant laws and regulations, suchas the Act against Delay in Payment of Subcontract Proceeds,
Etc. to Subcontractors, but also strive to fulfill our social
responsibility within the supply chain in order to build multilayered production bases and a reliable supply network when
undertaking day-to-day purchasing activities.

Compliance with the Act against Delay inPayment of Subcontract Proceeds, Etc. to
Subcontractors (Subcontract Act)

Policies
Yokowoʼs Purchasing H.Q. conducts its operationsin accordance with the following basic policies:
Cost Reduction, BCP Strategies, and Strengthening
Procurement Capability.
Date of formulation: April 1, 2020

Details of the basic policies

Cost Reduction

Work
style

A safe and secure workplace
Eliminate unsafe conditions
Eliminate unsafe behaviors

Risk Assessment
Committee■ Striving to reduce costs■ Ensuring that costs are set early■ Thorough implementation of theprinciple of Sangenshugi—theThree Actuals (the actual place,the actual part, and the actual
situation)

BCP Strategies■ Stable procurement■ Supplier quality enhancement■ Fair and equitable selection of
suppliers

Strengthening
Procurement
Capability■ Training and developing humanresources■ Compliance with relevant laws,
ordinances, and specifications■ Consideration for the environment
and for society

Healthy mind
and body
A healthy
Health workplace

SafetyHealth and Safety Committee

Measures Relating to Procurement

Ideal Form

General Managers, Health and Safety Management /Senior Health and Safety Management Officer
Occupational Health, Safety,
and Environment Section

Approach to Procurement■ Having employees attend external seminars■ Implementation of internal education■ Responding to Japan Fair Trade Commission (JFTC)
questionnaire surveys■ Checks performed in day-to-day operations (with rigorous
verification of negotiations, unit price setting, acceptanceinspection, and payment)

Elimination of child labor, use of prohibitedchemical substances, and use of conflict minerals■ The requirement to eliminate child labor, use of prohibitedchemical substances, and use of conflict minerals is clearlystipulated in the Code of Conduct for Business Transactions(and Agreement), which was compiled as an annex when
Yokowo revised its master agreements pursuant to therevision of Japanʼs Civil Code.
■ Surveys of the substances contained in mass-produced
products are being implemented at all Yokowo Group plants■ When launching production of a new model, suppliers are
required to provide data on the substances contained at thetime of the first sample inspection■ The prohibition on conflict minerals applies to materials thathave cobalt, cassiterite, tungsten or gold as a raw material

Implementing Green Procurement
The Yokowo Group holds presentations for our suppliers on
chemical substances contained in products, and we implement
environmental assessment that includes constituent analysisof the items that suppliers deliver. In addition, the masteragreement that we sign with suppliers includes provisions
relating to not using harmful chemical substances, ourprocurement activities prioritize purchasing items that havea smaller environmental footprint, and product verification is
performed in collaboration with our Quality Assurance H.Q.

Follow rules / Self-management / Compliance
Head Office, Tomioka Plant,
Domestic Offices

47

Domestic Subsidiaries

Yokowo 2022 Integrated Report

Cooperative Company
in Tomioka Plant

Yokowo 2022 Integrated Report48

ESG Report

Local Communities
Operating in a range of locales both within Japan and overseas, the Yokowo Group values our relationships withlocal communities, and is promoting multifaceted social action programs. As a company rooted in local communities,
we will contribute to their development, and towards achieving a sustainable society.

On Contributing to Local Communities
As a member of local communities, the Yokowo Group is
promoting a range of social action programs. Our aim is todevelop alongside local communities, through activities that
support their development, and initiatives that contribute tosolving societal issues.
▼ Three Areas of Activities
Activities groundedin the community

Activities towards
achievinga sustainable society

Policy for Community Social Contribution
Activities
We will listen to the voices of local residents, andimplement genuine initiatives and contribute to thehappiness of the community and society regarding
diverse issues so that we can be recognized as apartner.

Yokowo 2022 Integrated Report

Sports Classes (Tomioka Plant)
In September 2022, Yokowo held a baseball event for the children of local residents and employees at the Yokowo Silk Stadium Tomioka, a civic baseball field in Tomioka City with which wehave a naming rights agreement.
Yokowo is working together with local government on activities to increase the number of people playing sport, and tointeract with the local community through sport such as Tee-ball,which is enjoyed by beginners up to early elementary school age.

Yokowo participated in a blood donation event at DONGGUAN YOKOWO CAR COMPONENTS CO., LTD., at the request of
Dongguan City. A blood collection bus came to the plant, where
133 employees donated.

Support for an Orphanage(YOKOWO VIETNAM CO., LTD.)

Activities that
contribute tocommunity development

Also, in order that we can make steady contributions to dialogue
and development with local communities, In April 2022,
the Social Activity Promotion Section was established within
the General Affairs Department. At the same time we haveformulated a policy for community social contribution activities,
and have started by promoting activities in cooperation withmunicipal governments, mainly in Tomioka City and Gunma
Prefecture.

49

Participation in blood donation event(DONGGUAN YOKOWO CAR COMPONENTS
CO., LTD. [China])

Community-based Activities

In January and June 2022, in collaboration with other like-minded Japanese companies located in the same industrial park,
YOKOWO VIETNAM provided a local orphanage with material
support such as clothing, food, and beverages, including milk.

Activities that Contribute toCommunity Development
Naming Rights Partnership Activities(Tomioka Plant)
Wishing to contribute to the development of Tomioka City,
Yokowoʼs hometown, the Tomioka Plant participated in the
open bidding for the naming rights for three local sports facilities
and was chosen as a partner enterprise by Tomioka City. As of
August 2022, the facilities have used new sobriquets with theaddition of "silk" — this is representative of Tomioka's uniquenature. Tomioka Plant will encourage its employees and theirfamily members to use these facilities, which will improve theirhealth and foster the building of closer connections throughsports, while at the same time this will also support the joint
development of both the local community and Yokowo.
The naming rights agreement
covers the three-year period
between February 2021 andMarch 2024.

Total cost of naming rights:

4.5

million yen

YUKA Volunteer Team(DONGGUAN YOKOWO CAR COMPONENTS
CO., LTD. [China])
In 2016, DONGGUAN YOKOWO CAR COMPONENTS CO., LTD.
formed the YUKA Volunteer Team, which promotes activities tosupport the elderly and people with disabilities in the community.
These activities include holding volunteer events, environmental
conservation activities, and PCR testing for COVID-19, and thesesee many employees volunteering to participate.

155

Employees who have participatedin volunteer activities (2016 to present)      Activities towards Achieving a
Sustainable Society
Volunteer tree planting activities (YOKOWO
MANUFACTURING OF THE PHILIPPINES, INC.)
Having begun operations in May 2022, YOKOWO
MANUFACTURING OF THE PHILIPPINES, INC, volunteered toplant 500 saplings in cooperation with local industrial parks andauthorities, aimed at protecting and preserving the environment.

Vocational Training Activities with Universities(YOKOWO VIETNAM))
YOKOWO VIETNAM works in tandem with local universities to
accept new students and graduates for internships and plant
tours. The Company also engages in activities to deepen exchanges with local communities as well as to contribute to local
development. These include support activities to familiarize students with Japanese language and culture.

Yokowo 2022 Integrated Report50