Fujikura Group
FujikuraFujikura Ltd.
Ltd.
1-5-1,
1-5-1,Kiba,
Kiba,Koto-ku,
Koto-ku,Tokyo
Tokyo135-8512
135-8512
Corporate
CorporateCommunications
CommunicationsDiv.
Div.
fjk.esg@jp.fujikua.com
fjk.esg@jp.fujikua.com

Integrated
Report 2021

2021

“Tsunagu”
Technology

To Stakeholders(Announcement from person in charge of governance)

Online process explanations

Discussion via the web

Quality Pledge Day

Message from the President to employees

Having weathered past errors concerning unsuitable quality,
we must instill awareness of quality compliance and fomenta culture in which past mistakes are not repeated. To thisend, since FY2019 we have held a Quality Pledge Day inwhich all Fujikura employees pledge to prevent a recurrenceof unsuitable quality. In the headquarters region, we holdmeetings which all personnel above the managerial level
attend, and broadcast the details of those meetings. In otherregions we distribute the President's message.
In FY2020, to ensure the President’s message reached
all employees, a recording was made available on thecompany intranet. It stressed, to each and every member ofthe organization, the importance of considering complianceviolations themselves, rather than thinking they are someone
else’s problem. Addressing all employees, the President
expressed his strong conviction that we must recognize thatmaintaining the quality our customers have contracted isthe essence of our corporate value, and work to improve ourcorporate value.

Fujikura Group Integrated Report 2021

Corporate GovernanceFujikura Group Integrated Report 2021

We continue to encourage two-way communication between senior management and front-line workers. This shrinks the distance
between management and the worksite, and promotes an open corporate culture. In FY2020, restrictions on movement between
locations due to the pandemic made face-to-face audits difficult. But senior management was able to use teleconferencing software
to inspect workplaces themselves and exchange ideas with front-line workers. This allowed them to get an idea of the degree towhich awareness of compliance had spread throughout the entire company, as well as workplace challenges and the status ofefforts to address them. It also gave them a chance convey a message of placing a priority on compliance directly to workers.

ESG Integration1

Dialog with Front-line Workers

Business Opportunities

Masahiko Ito

The Fujikura Group is working on improvement of awareness of quality compliance based on the preventative measures announced
on April 25, 2019. These efforts include governance reforms, appropriate understanding of production process capabilities andtesting capacity, and verification of requested customer specifications. We started work on all preventative measures during FY2019.
In FY2020, we evaluated the effectiveness of the measures we had taken to date, and moved forward steadily on the preventative
measures that needed to be continually implemented. In FY2021, we will work to continue thoroughly implementing thesepreventative measures.

Value Creation with “Tsunagu”
Technology

Director, President and CEO■ Concerning Preventative Measures

Messages from Management

Please allow me to express my deepest appreciation
for your continued support. I want to convey mydeepest condolences for everyone who has losttheir lives due to COVID-19, as well as express
my sympathies to the families of those who havecontracted the disease. I also want to thank thoseworking in healthcare settings, and everyone doing
their part to help prevent the spread of infection.
Now then, since last fiscal year’s sudden
downturn in performance, our group has set
focusing on prompt recovery of business as ourbasic strategy. And we have narrowed down ourimportant strategies to the unreserved selection
and concentration of existing businesses andstrengthening of corporate governance. Following
our 100-Day Plan to turn around operations,formulated in September 2020, we are pursuing
various measures towards drastic reform of ourmanagement practices and business structure.
Especially with regards to strengthening ofcorporate governance, in April 2021 the general
meeting of stockholders approved decisive action
toward drastic reform of our management structure.
Specifically, we created the new roles of CEO (Chief
Executive Officer) and COO (Chief Operating Officer).
As CEO, I will continue to solve management
challenges for the entire company and vigorously
pursue reform of our business structure. Meanwhile,
Mr. Okada will continue in the role of COO.
In this capacity, he has the authority to carry out
operations related to our core business. This improves
maneuverability in advancing projects and increases
the speed of business decisions. In addition, bydecreasing the number of internal directors, we cancreate a structure in which half of the board consistsof outside directors, allowing for more effective
governance. Moreover, we have abolished the current
internal company structure and moved toward
greater vertical integration with a business unit
structure under the direct control of the COO.
This reorganization placed corporate officers directly
under the COO and makes clear their responsibilities
and authority to take charge of business. This has halved
the number of these personnel.
I promise to devote myself completely toachieving our business reconstruction plan toquickly turn around operations, by carrying throughstrategic policies. These include this drastic reformof our management structure. We would sincerely
appreciate the further support of all stakeholders
going forward.

Measures to Prevent Recurrence ofCases of Unsuitable Quality

2

Contents / Editorial Policy
To Stakeholders (Announcement from officer in-charge of governance)

2

Measures to Prevent Recurrence of Cases of Unsuitable Quality

3-4

Contents / Editorial Policy

5-8History

9-16

Message from the CEO

21-24

Messages from Outside Directors

17-20

Message from the COO

25-26

Top Management

Purpose29-30

Fujikura Group Corporate Philosophy (MVCV)

31-32

2030 Vision33-34	Fujikura Group Long-term Environmental
Vision 2050
35-40

Sustainability Target 2025

41-44

Capital for Value Creation

Business Process

45-46

In editing the Fujikura Group Integrated Report 2021,

Please see Financial Data for details about FY2020 settlement

we focused on giving shareholders, investors, and otherof accounts.

stakeholders an understanding of initiatives targeting sustained

https://www.fujikura.co.jp/eng/ir/index.html

are aiming to achieve greater understanding of our efforts[Important Points Concerning Forecast]concerning ESG and sustainability through disclosure of the

The financial forecast and descriptions relating to future

information contained in this report and use of this information

predictions for Fujikura Ltd. and its consolidated subsidiaries

by everyone who has read it. This edition includes corporate

contained in this report describe the outlook at the timegovernance reforms and examples of Clean Tech.

of editing, and include latent risks, uncertainties and otherfactors. Therefore, these forecasts are not a guarantee of future

OutputReference Guidelines

performance, and results may vary widely due to various

47-48	The “Tsunagu” Connecting Technologies that
Support Our Lives• IIRC (International Integrated Reporting Council)

important factors.

Strategy and Business Performance

International Integrated Reporting Framework
Scope of Report• GRI (Global Reporting Initiative) Sustainability ReportingStandard

Target period: April 1, 2020 to March 31, 2021

49-52

Progress on the 100-Day Plan

53-54

Business Results by Unit

for Integrated Corporate Disclosure and Company-Investor

55-56

Telecommunications Systems Business Unit

Dialogues for Collaborative Value Creation

57-58

Electronics Business Unit

59

Automotive Business Unit

60

Real Estate Business Unit

Source of Value Creation• METI (Ministry of Economy, Trade and Industry) Guidance(Includes some content from after April 2021)
Target organization: Fujikura Ltd. and the Fujikura Group• World Economic Forum ESG Metrics

Business Opportunities

Input

Detailed Information Concerning Account Settlement• TCFD Guidelines 2.0• SASB Standard■ Communication Tools

61 Business Opportunities
61-64

Fujikura Group Clean Tech73

Human Resource Development

65-68

Response to Climate Change (TCFD)

74

Health Management

69-72

Research & Development

Integrated Report
ESG Integration

Integrates financial and non-financial information, and tells
the story of Fujikura’s medium and long-term value creation.

75 ESG Integration
75-76

Respect for Human Rights

77

Responsible Mineral Sourcing

78

Health and Safety

79 Corporate GovernanceCorporate Governance87

Export Control

85

Risk Management

88

Instilling the Corporate Philosophy

86

Compliance

89-90

Supporting Fujikura Gakuen

91-92

Fujikura Kiba Millennium Woods

93-94

Corporate Profile

Fujikura Group Integrated Report 2021

Investor Information

ESG Information

Product/
Technology Information

Data file

ESG Data

Fujikura News

Securities Report

Corporate Governance
ReportFujikura Technical Journal

Corporate Governance

3

79-84

Value Creation with “Tsunagu”
Technology

27 Value Creation with “Tsunagu” Technology
Value Creation Model

Basic Policy

growth of the Fujikura Group from multiple perspectives. We

Messages from Management27-28■ Editorial Policy

Messages from Management

91

Fujikura Group Website

Fujikura Group Integrated Report 2021

4

History

1885 — The Beginning

Five large braiding machinesimported from the USA by
Zenpachi Fujikura

1932

44 kV triple-core SL cable supplied
to the Yamaguchi Prefecture ElectricPower Bureau (a first in Japan)

EnergyTelecommunication systems

1935

Patent acquired on
Fujikura’s proprietaryhigh-frequency coaxial
cable

Phase of1945 — 2nd
Reinvention

1981

Japan’s first OPGW (Optical Fiber
Composite Overhead GroundWire)*1 developed

Expansion into the energy and network
information services and diversification
leading to current business

1984

Provided coiled cords to connect
keyboards to PCs, and grew to hold a 70%
share of the global market

EnergyTelecommunication systems
Electronics
Automotive electronics

1985

Value Creation with “Tsunagu”
Technology

1887

Known for its technology, Fujikura
has contributed to the creation of anabundant society by establishing electric
power and communications infrastructure

Messages from Management■ From Our Founding to Today

World’s first core alignment
optical fiber fusion splicer
developed*2

Business Opportunities*1 OPGW: An abbreviation of Optical fiber composite overhead ground wire. An overhead cable incorporating optical fibers.
*2 Optical fiber fusion splicer: A machine used to fuse optical fiber cables together.

■ Establishment
1901

1910
Fujikura Electric Wire Corporation
is established (Now Fujikura Ltd.)

Fujikura Waterproof FabricCorporation (Now Fujikura
Composites Inc.*)* Equity method affiliate

5

Post-war Era of Recovery & High Growth1885	Zenpachi Fujikura founds the company and begins

manufacturing silk and cotton insulated winding wires in
Kanda-Awajichō1887	Zenpachi Fujikura imports five large braiding machinesfrom the USA
1893	Company begins manufacture of first rubber-insulated
wires in Japan1901	Fujikura Electric Wire & Rubber Co., Ltd. established andbegan producing rubberized fabricLaying the Foundations of Fujikura

1945	Complete destruction of Fukagawa plant during bombing of Tokyo(Rebuilt the same year)

1949	Delivery of Japan's first 24-core TV camera cables to NHK (Japan
Broadcasting Corporation)

Founding location:
Kanda-Awajichō plant1910 Fujikura Electric Wire Corporation established1919	Established Fujikura Gakuen, a special facility for mentallychallenged children, on Oshima island

1923	Head office and plant relocated to Fukagawa where it
1931

is totally destroyed by fire in the aftermath of the Great
Kanto Earthquake (Rebuilt the following year)
Began manufacturing “Fujikousen” electric wire for aircraft

Post-earthquake Recovery and Technological Advances

1935	Patent acquired on the Fujikura-type high-frequency

Reconstructed Fukagawa plant1954 Numazu plant completed
1957 Began manufacturing wire harnesses
1958	Established Tama Fujikura Gakuen
1965	Completion of the Sakura plant and beginning of manufacturing ofprinted circuits using a die stamp method*3	1970 Suzuka plant completed
1974	Began inspecting optical fiber base materials manufactured by the CVD
method*4
1979	Began manufacturing FPCs (Flexible Printed Circuit boards) for
electronic devices*3 Die stamp method: A wiring circuit pattern is etched into a die to create a press die.
Copper foil is then layered on top of a plastic substrate and pressed while being
heated. This causes copper foil to be pressure bonded to the surface of the substrate
only in the pattern of the circuit etched into the die.
*4 CVD method: Chemical Vapor Deposition method.

Fukagawa Plant being rebuilt
following damage in WW2

Numazu Plant upon completion

Sakura Plant upon completion

Suzuka Plant upon completion

Corporate Governance

1910

Beginning

ESG Integration

Fujikura Electric Wire & Rubber Co.,
Ltd. is established(Representative : Tomekichi
Matsumoto)■ Primary Endeavors

coaxial cable1941	Began manufacturing aluminum wire
1943 Began manufacturing Fujikura-type 100 kW coaxial cables

Fujikura Group Integrated Report 2021

Fujikura Group Integrated Report 2021

6

History

1998

500 kV CV cablesupplied for the cableline between ShinKeiyo and Shin-Toyosu
substations

Supplied world’s largest
500 kV OF submarine DC
cable to Kansai Electric Power
Co., Inc. and J Power (ElectricPower Development Co., Ltd.)

Telecommunication systems
Electronics
Automotive electronics

2002

Supplied high-speed transmission
cable for connecting servers

EnergyPhase of2005 — 3rd
Reinvention

2007

Critical current record* shatteredwith Yttrium-based oxide
superconducting wire*2
1

Set forth a long-term vision and pursued
further technological development andmarket access

Telecommunication systems
Electronics
Automotive electronics
Real estate

2018

Released optical cable with themost cores in the world (6,912 cores
Wrapping Tube Cable® (WTC®))

2020

Value Creation with “Tsunagu”
Technology

1996

EnergyMessages from Management

Strengthened our technological footing
while pressing forward with globalizationand new businesses

Our company’s cold plates used in
the Fugaku supercomputer

Business Opportunities*1 New world record for high performance and length.
*2 Chemical compounds that cause transition to a superconductive state at 90 K or higher.

Era of Turbulence and Trials

1992	Changed corporate name from Fujikura Electric Wire

Corporation to Fujikura Ltd.
1993	Tokyo R&D center completed
Delivered 500 kV CV cables and Hokkaido-Honshu optical fiber
integrated submarine cables
1998	Supplied world’s largest 500 kV DC OF submarine cables to
Kansai Electric Power Co., Inc. and J Power (Electric Power
Development Co., Ltd.)
2000	Established optical component manufacturer, Fujikura Fiber
Optics Vietnam Ltd., in Vietnam
2001	Commercialization and marketing of FTTH*2 optical fiber products
Established FESL and DDK Kunshan
2002 Supplied high-speed transmission cable for connecting servers

2005	120th anniversary; adoption of new management principles:

MVCV (Mission, Vision, Core Value); and establishment of America
Fujikura Ltd. to manufacture and sell electrical components fortelecommunications and automotive applications
2007	Shattered the critical current record with an yttrium-based oxide
superconducting wire2008	Spanish wire harness manufacturer becomes a wholly owned
subsidiary of Fujikura and changes corporate name to Automotive
Europe S.A.U.
2009	Began manufacturing fiber lasers
2010	Established Fujikura Electronic (Thailand) Ltd. by unifying seven
Thai group companies; completed ‘Fukagawa Gatharia’ (Fukagawa
re-development project); opened Fujikura Kiba Millennium Woods
Bio-Garden*2 FTTH is an abbreviation of Fiber to the Home. It is an access method for linking
telecommunication provider equipment to each home via optical fiber.

Manufacturing opticalfiber preforms using
the VAD method
Developed world’s
first multi opticalfiber fusion splicers

7

Fujikura Group Integrated Report 2021

2011	Great East Japan Earthquake, and Fujikura Group's

manufacturing bases damaged by floods in Thailand

2013	Introduced in-house company system throughreorganization

2015	The VAD Method is Recognized as a Prestigious IEEE
Milestone*3

2016	The Fujikura Group declares complete recovery from floodsin Thailand
Established Fujikura Group Long-term Environmental
Vision 2050
2017	Transitioned to a corporate structure with an Audit &Supervisory Committee
Established 2030 Vision2018	Released optical cable with the most cores in the world(6,912 cores Wrapping Tube Cable® (WTC®))
2019	Joined the RE100 global corporate leadership initiative
2020	Our company’s cold plates used in the Fugaku
supercomputer
2021 Abolished in-house company system through reorganization

Corporate Governance*1 VAD method: Vapor-phase Axial Deposition Method

Era of Globalization and New Technologies

ESG Integration

1980	Development of single-mode optical fusion splicers
Lead the world in developing ultra-low OH fibers using the VAD
method*1, an independent technology developed in Japan
1981	Japan’s first OPGW (Optical Fiber Composite Overhead GroundWire) is developed
1984	Established local subsidiary Fujikura Electronics (Thailand) Ltd.
1985	100th anniversary of Fujikura's founding, and development of theworld's first core alignment fusion splicer
1987	Successful fabrication of oxide superconducting wires, andcompletion of the Optical Electronics Laboratory
1988	Developed world's first multi optical fiber fusion splicers
Established local subsidiary Fujikura Europe Ltd. in the UK
Established PCTT Ltd., DDK (Thailand) Ltd. (Began manufacturing
FPCs and connectors in Thailand)*3 IEEE Milestone: A program administered by the world’s largest
professional association, IEEE (Institute of Electrical and Electronics
Engineers) which recognizes technological innovations that are at least
25 years old and have received high praise internationally.
Established Fujikura Electronics(Thailand) Ltd.

External view of head office

Fukagawa Gatharia
redevelopment project

Established Fujikura Kiba Millennium
Woods bio-Garden

Fujikura Group Integrated Report 2021

8

Message from the CEO	Expression of Gratitude for Employees on
the Frontlines during the COVID-19 Pandemic

Messages from Management

Rapid achievement of the 100-Day Plan
and beginning to draw a clear pictureof the growth phase

Value Creation with “Tsunagu”
Technology

I would like to offer my heartfelt gratitude to all of our stakeholders for your continued
support of Fujikura Group business activities.
We are continuing to respond to the COVID-19 pandemic, which has persisted since2020. The Fujikura Group regards ensuring the health and safety of employees who workon the frontlines as our highest priority as we continue business operations. Our overseas
manufacturing locations in Vietnam, Mexico, and elsewhere are the locations currently
maintaining strict response measures. Our location in Mexico is striving to maintain stable
operations while placing the highest priority on preventing infection of employees who
work on the frontlines. They are implementing measures to prevent clusters of infections bycreating multiple work teams, implementing preventive measures to minimize the impact
to the extent possible if someone is infected, and providing education on personal healthconsciousness, among other measures. The speed of response to such a crisis is giving me asense of the hidden reserves of strength in local operations and I am very thankful for eachand every member of executive management and the management teams at our locations.
Recent financial performance has been affected by severe conditions in the energy
business, domestic cable-related business, and automotive products business, while
receiving an extremely strong boost from electronics-related demand from people who
are telecommuting and staying at home. Such conditions have also stimulated demandfor oxygen sensors, pressure sensors, and other healthcare-related electronic devices. FPC,
connectors, and electronic components all recorded growth.
Fujikura is midway through the transformation aimed at completing the 100-Day Plan
to turn operations around, which was formulated in 2020. The entire company continues towork as one team with unwavering determination to achieve a turnaround.

Business Opportunities■ Decisive Strengthening of Governance9

Fujikura Group Integrated Report 2021

Fujikura Group Integrated Report 2021

Corporate Governance

Masahiko Ito

ESG Integration

Director, President and CEO“The unreserved selection and concentration of existing businesses” and “strengthening ofGroup governance” are the two key measures in the 100-Day Plan.
In regard to strengthening governance, governance is said to be corporate governanceor control, but I see it as forming a consensus to align the direction of everyone’s efforts,from management to employees. To strengthen governance, we simplified the structure
for communicating intent and the chain of command and switched to an organizational
structure that enables quick formation of an accurate consensus.
More specifically, we eliminated the in-house company system and transitioned to abusiness unit system with the change in business structure on April 1, 2021. A multilevelstructure of individual in-house companies with sub-companies underneath them existed
up to this point, and the head of each in-house company was listed as an executive director.
The revised structure established the post of Chief Operating Officer (COO) to assume
responsibility for all business execution in the Company’s core businesses. We also revised
the corporate officer composition. While I cannot deny that the seniority system was one
aspect of corporate officer selection up to now, we reconfirmed the mission and significanceof each organization based on the new organizational structure and then appointed the best
person to execute the mission of each organization as an Corporate Officer. These changes
consequently reduced the number of directors and corporate officers by half. Halving thenumber of directors increased the percentage of outside directors to 50%. Some outside
directors were also replaced and new Directors were added who possess the experience andknowledge necessary for Fujikura in its current turnaround phase. Some were people whohave actually completed an operational turnaround. The Board of Directors will engage in
effective discussions aimed at a turnaround.
10Message from the CEO

Director

Director[Core Businesses]• PC Business Unit
• Connector Business Unit
• Automotive Products
Business Unit

• Corporate Governance Unit
• North American
Operations*• Electronic Components
Business Unit
(Corporate officers not concurrently serving as directors: 11)

11

Fujikura Group Integrated Report 2021

• Industrial Cable
Business• Real Estate Business• Corporate Unit
• Corporate Quality
Control Unit
• New Business Creation
and R&D Unit

* North American telecommunication systems business,
mainly involving AFL Telecommunications LLC

I will explain progress on the other key measure in the 100-Day Plan, “The unreserved
selection and concentration of existing businesses.”
First, in the Telecommunication Systems business, we are working to switch the coreof the business from the business of selling optical fiber and preform and to an opticalcable business that adds high value. We will use our strength in SWR®/WTC® as leverageand combine it with the ancillary optical cable solutions business to meet the vigorous
demand from European and U.S. carriers and hyperscale data centers (HSDC) operated by
IT corporate groups.
While the FPC business has grown with the smartphone market, we unfortunately
cannot set prices commensurate with the technological capabilities because costcompetition is intensifying. We have therefore decided to withdraw from unprofitableproducts and specialize in products that focus on quality and add high value. Fujikura will
eliminate and consolidate some locations and shrink the business scale to accomplish that.
Although we have followed the expansion strategy of our main customers and invested
in the automotive wire harness business, we received orders exceeding manufacturing
capacity and resorted to outsourcing to cover that gap. This has consequently become abusiness that invites high costs. To extricate ourselves from such conditions, we replaced
the person in charge of the business and normalized the order volume accepted. We
also streamlined the plant production structure and made labor adjustments. An early
retirement incentive program was introduced and this caused hard feelings and pain
among employees. These efforts accounted for 8.2 billion yen in cost reductions in FY2020,
out of the 15 billion yen fixed cost reduction target for the operational turnaround. We will
make sure we achieve the remaining cost reductions targeted during this fiscal year.

Fujikura Group Integrated Report 2021

Corporate Governance• Telecommunication Systems
Business Unit	Steady Progress on Selection andConcentration

ESG Integration

Director & COO

Business Opportunities

Structural Reforms
Taskforce

President & CEO

Value Creation with “Tsunagu”
Technology

The posts of Chief Executive Officer (CEO) and Chief Operating Officer (COO) establishedas part of this management reform are positions established for the first time in Fujikura’s
history. I was appointed as CEO and Naoki Okada, who was a senior vice president and headof the Corporate Strategy Planning Division up to last fiscal year, was appointed as COO.
First of all, the role of the COO is to look at all five of the business units positioned
as core businesses and integrate business execution. The five business units are
Telecommunication Systems, Printed Circuit (PC), Connector, Automotive Products,
and Electronic Components. In particular, the COO is expected to serve as an interface
providing a cross-organizational connection among the individual business units. In theexisting in-house company structure, each business unit was able to mine the depths ofthe business, but cooperation with other business units was an issue.
The Fujikura Group possesses outstanding technologies and solutions that cancontribute to society. We therefore need to share information across business units to fully
utilize these assets to create new value. If we can introduce the technologies and solutionsof other business units to our business unit’s customers, or introduce our business unit’s
technologies and solutions to the customers of other business units, this will naturally
increase points of contact with our customers. It should also make it possible to multiply
the number of business opportunities as seen from a company-wide perspective. I am
directing the COO to establish an environment that eliminates barriers between business
units and makes it possible for everyone to converse freely so they can propose the manykinds of technologies and solutions the Fujikura Group possesses to customers. We are
currently in the turnaround phase, so first solidifying the ground we stand on is the highest
priority. However, I also have my sight set on the growth phase beyond the turnaround,
and will have the COO play an extremely important role in this. I have instructed the
COO to build a structure that will stimulate many types of chemistry among the various
technologies and solutions and activate metabolism by eliminating the barriers between
business units.
As the CEO, I will focus more on the role of delineating a broad strategy to ensurethat the Fujikura Group continues to exist as a sustainable company far into the future. I
also aim to speed up decision-making and manage in way that is easy for stakeholders tounderstand by establishing a vertically integrated line between the CEO and COO.

Messages from Management■ The Roles of CEO and COO

12

Message from the CEO

Exchanging Opinions via the Web	Exploring the Vision for Digital
Transformation (DX) in Fujikura
Fujikura is pursuing the use of digital technologies, such as the early introduction of AIbased automated inspection systems in manufacturing plants. We also plan to turn ourplants into smart factories and use digital technology in other ways in the future.

	Maintaining an Entrepreneurial Mindset
in R&DI will introduce an example of an initiative involving new business creation. While Fujikura
is pursuing a process of selection and concentration in the operational turnaround phase,
we need to achieve reliable growth of our core businesses and create and develop new
businesses to adapt to changes in the world in order to create a bridge to the growthphase beyond the turnaround phase. The New Business Development Center was
integrated with R&D to achieve that. The purpose of this integration is to foster a more
entrepreneurial mindset among team members in R&D and enable them to perform R&D
with an awareness of end-user trends and needs, and an awareness of the value that
Fujikura is uniquely positioned to provide.
An example of success in the New Business Development Center is the entrance into
new areas of the medical business with an entrepreneurial mindset. The reason why thissucceeded is because the center used optical fiber technology, one of Fujikura’s coretechnologies, to develop and propose products based on the needs of end-users. The
center is sharing such experiences and the enthusiasm generated with members of the
R&D team as they anticipate new kinds of chemistry.

Value Creation with “Tsunagu”
Technology

There is no end point in our efforts to earn back the trust of society in regard to the casesof impropriety related to quality control announced in 2018. I continue to communicate
the fact that quality constitutes corporate value itself to employees. As the saying “badnews first” expresses, I think that communication activities to create a culture of quickly
delivering bad news to superiors and management is more important than anything else. I
am therefore continuing activities to hear the actual comments of those involved in quality
control and assurance directly.
Members of top management are fiercely determined to make sure that the cases ofimpropriety relating to quality control are never forgotten. We will continue to communicate
messages concerning measures to prevent recurrence, including changing the culture.

DX is not only for the manufacturing domain. I also want to use DX to expand business
opportunities by strengthening existing businesses, creating new businesses, and inother ways. I intend to use digital technology to discover the wants and latent needsof customers and increase the appeal power of Fujikura’s products and technologicalcapabilities. I also want to create new businesses by finding new businesses that go
beyond the concepts of existing businesses.

Messages from Management

	Never Allowing the Cases of Impropriety
Related to Quality Control to Be Forgotten

Fujikura Group Integrated Report 2021

A cooperative corporate initiative in which
influential companies around the worldcommit to switching to 100% renewableenergy use in their businesses. The use ofrenewable energy will lead to reduction
in company emissions, and enable broadscope energy cost management.

We will achieve a sustainable society byanalyzing the risks and opportunities
presented by climate change, working toresolve issues, and disclosing information
to stakeholders, based on the TCFD
recommendations.

Fujikura Group Integrated Report 2021

14

Corporate Governance13

 See the Fujikura Group Longterm Environmental Vision 2050
on P. 33 for more information.

ESG Integration

The greatest problem we are confronting in capturing the changes in the world is our
response to climate change. There are global cries for decarbonization. Japan has alsodeclared the goal of achieving carbon neutrality by 2050 and some customers are also
demanding reduction in CO2 emissions. We formulated the Fujikura Group Long-term
Environmental Vision 2050 in 2016 and are aiming to conquer four challenges. The mostambitious challenge is achieving net zero CO2 emissions from our plants in 2050. Introducing
renewable energy is an effective way to achieve that and Fujikura has joined the RE100, a
global initiative by companies committed to the proliferation of renewable energy.
Recognizing the need for active disclosure of information, we are also taking
advantage of the opportunity presented by endorsing the recommendations of the
Task Force on Climate-related Financial Disclosures (TCFD) and are organizing internal
information on carbon neutrality and other initiatives to combat climate change. We will
use such information to engage in constructive dialog with customers, investors, and otherstakeholders by analyzing the impact of climate change-related risks and opportunities
and disclosing information appropriately.
As I stated in the FY2020 Integrated Report, ESG is management itself and I feel thateven more strongly now. However, achieving carbon neutrality is an extremely highhurdle for manufacturers like Fujikura to clear. The ideas for achieving carbon neutrality
are not novel. They entail the main response measures of cogeneration to generateenergy in-house, purchase of credits, and other measures in addition to comprehensive
energy conservation. We are aiming to achieve more efficient operations by consolidating
scattered locations to achieve the medium-term targets for 2030, which are based onenergy conservation. That is also linked to the “selection and concentration” of businesses
in the 100-Day Plan and I would like to derive synergistic benefits from this.

Business Opportunities■ Achieving Carbon Neutrality

Message from the CEO See Fujikura Group Clean Techon P. 61 for more information.

	Establishing a Human Resource
Development System

15

There has been a bright spotlight on human rights issues in business in recent years. This is
one of the main business risks in managing businesses. I do not think that earning a profit
should be balanced against human rights. I intend to share the awareness that appropriate
business management is achieved by continuously and repeatedly checking on businessand human rights as the foundation of business with the entire company and instill thatawareness in everyone.

Fujikura Group Integrated Report 2021

Fujikura formulated and announced
Fujikura Group 2030 Vision in March2017 as the long-term vision thecompany will strive to achieve.
The vision declared the intent tocontinually enhance corporate
value by providing solutions to thechallenges in a “Mirai” (future) society.

Fujikura Group Integrated Report 2021

16

Corporate Governance See Respect for Human Rights on
P. 75 for more information.

The Fujikura Group is aiming to complete the operational turnaround phase together with
implementation of governance reforms. Although I feel that the earning power we need as
a company is returning, we are confronting new issues such as carbon neutrality, which I
mentioned before, as we integrate ESG into management. Corporate governance must be
strengthened to control various issues, and I also think we need to increase our sensitivity
to risk in corporate management.
Moreover, we are pursuing four areas of business through our 2030 Vision, as themedium and long-term vision of Fujikura, but I think we need to express our vision for the
future more clearly. We have the completion of the operational turnaround phase in sightin FY2021 and will draw the blueprint for the future aimed at growth phase in FY2022. I
will stand at the helm as we consider how to realize the mission in our MVCV corporate
philosophy, which states “The Fujikura Group’s mission is to create exceptional value for ourcustomers around the world using “tsunagu” (the Japanese word meaning “connecting”)
technologies.” We also want to reduce the cost of capital by establishing governance ofsustainability.
I would like to ask all of our stakeholders for your continued understanding and support.

ESG Integration

	“Business and Human Rights” Is a Preliminary
Condition for Operating a Business	Completing the Operational Turnaround
Phase

Business Opportunities

The Fujikura Group needs to establish an environment that enables all Group employees
to actively contribute from a global perspective as the overseas sales ratio of theCompany increases year after year. We are pursuing more global human resource
development by developing, finding, and hiring talent to foster an organizational culturethat synchronizes corporate growth with employee growth and to lead innovation. A
particular initiative we are working on is formulating succession plans for management.
Providing an environment that enables employees to take on challenges and have avariety of experiences from a young age is important for securing and developing thetalent who will become management in the future. I want to boost their desire to take theinitiative to improve their own skills in addition to providing the programs necessary for
management and other opportunities. We have also formulated a new human resource
development policy as a guide for creating an organizational culture in which employees
mutually acknowledge and improve one another, in addition to the systems for supporting
independent career building and providing growth opportunities, etc. Human resource
development has mainly involved establishing a training program for each job type withtraining by grade level up to now. I recognize the need for training that is carefully tailoredto the abilities of each individual in the future. I also want to maximize the benefits ofhuman resource development by providing systems and opportunities that stimulate
motivation in relation to drive.

Four market areas envisioned
in the 2030 Vision

Value Creation with “Tsunagu”
Technology

I will explain WTC® small-diameter, high-density optical cable WTC® offers productperformance that makes it possible to insert high-density cable into existing smalldiameter spaces while also contributing to reduction in the customer’s total cost ofownership (TCO). Telecommunication construction has required ducts and hand holes
to accommodate higher fiber counts up to now, increasing the percentage of civilengineering costs. However, WTC® is thin and light, and existing equipment can be used.
This renders additional civil engineering construction unnecessary and can substantiallyreduce construction costs for the customer. Producing WTC® also takes 78% less energy
than manufacturing cable possessing the same functions. WTC® has many properties
that add environmental value such as reducing the amount of plastic used in products,
reducing electricity use by improving manufacturing efficiency, and reduction in CO2emissions with improved transport efficiency. In the future, how many energy-efficient
products we can produce will be important. I want to continue to develop green products
based on the good practices for WTC® and contribute to achieving the sustainable
development goals (SDGs).

The Fujikura Group Policy on Human Rights was established in 2017. We are working
to establish human rights due diligence based on the UN Guiding Principles on Businessand Human Rights and other guidelines. In the process of conducting due diligence, we
became aware that we have not been able to achieve a sufficient response at present
and there are numerous issues that we had not recognized as risks. When considering thematerialization of procurements risks in the supply chain, in particular, there were several
instances in which I was struck at the extent to which Fujikura is connected to the supply
chain. I would also like to strengthen the response to business and human rights in theentire supply chain because some suppliers have not established human rights policies
and taken other steps.

Messages from Management

	WTC® Adds Environmental Value toInnovative Products

Message from the COO

PROFILE See Progress on the 100-Day Plan
on P. 49 for more information.

Business Opportunities

My name is Naoki Okada and I recently assumed the position of Chief Operating Officer(COO). I have been involved in the Telecommunications Systems business since I joined
Fujikura Electric Wire Corporation (now Fujikura Ltd.) in 1986. The Telecommunication
Systems business is now the core business of Fujikura, but there was a time when thesurvival of the business was threatened by saturation of the domestic market and harshconditions for maintaining profitability of the business. When I reflect back on that time, I
understand that I was able to gain many kinds of experience related to management, suchas a broad perspective that enabled Fujikura to establish superiority in technology that
other companies could not replicate and secure sustained profit.
I subsequently transferred to the Corporate Strategy Planning Division (now theBusiness Planning Department) in April 2020, and compiled the 100-Day Plan as theadministrative office for structural reform. I have spent more than thirty years in plants sowhen I was appointed as COO, I had some concerns about whether I would be able to fully
accomplish this important mission. However, I want to fulfill the mission I have been tasked
with to achieve the growth of Fujikura.
As the Chief Operating Officer, the COO is responsible for executing and managing thebusiness strategy, based on the policy established by the CEO (Chief Executive Officer).
The first thing that I must do as COO is complete the 100-Day Plan. I recognize that theCompany’s financial condition has improved compared to what it was a one point. WhenI think about the additional structural reforms in the future though, I cannot say that thefinancial condition is sufficient yet and will continue to focus on further improving financial
soundness. To achieve sustained growth of Fujikura in the future, we need to manage thebusiness in a well-modulated manner with an eye toward the future rather than simply
focusing on the turnaround in front of us. To accomplish that, we have designated fivebusiness units as core business units: The Telecommunication Systems Business Unit,
Printed Circuit (PC) Business Unit, Connector
Business Unit, Automotive Products Business Unit, and Electronic Components
Business Unit. The COO will execute business strategically while keeping watch over all ofthese core businesses.

Value Creation with “Tsunagu”
Technology

Apr. 2008: General Manager of the Optical Cable Research andDevelopment Department
Jun. 2012: General Manager of the Optical Cable Research andDevelopment Department and General Manager of
the Optical Cable Manufacturing Department
Apr. 2013: General Manager of the Cable and Equipment R&D
CenterMar. 2014: General Manager of the New Optical Fiber Cable
Business Development Department
Apr. 2018: General Manager, Head of the Optical Cable
Systems Division
Apr. 2020: Managing Executive Officer, Head of the Corporate
Strategy Planning Division
Apr. 2021: Corporate Officer & COO
Jun. 2021: Director and COO

	Targeting Completion of the 100-Day Plan
as COO

Naoki Okada
17

Fujikura Group Integrated Report 2021

Fujikura Group Integrated Report 2021

Corporate GovernanceDirector and COO

 See Achievements by IndividualBusiness Units on P. 53 for more
information.

ESG Integration

	Constant Search for New Business
Opportunities in Core Businesses
Fujikura formulated the 2030 Vision in 2017 as our medium-term vision. We have specified
Advanced Communication, Vehicle, Life-Assistance, and Energy & Industry as the four corebusiness domains. The areas of telecommunication systems, automotive products, andelectronics within those domains will undergo more transformation in the future and areareas in which there are diverse range of technological innovations. I will talk about the
future direction of the five core business units that I am responsible for.
Telecommunication Systems Business Unit Data centers and other telecommunication
systems infrastructure are expected to become increasingly important with the expansionof 5G/6G, IoT, AI, and other technologies, and we are pursuing investment worldwide.
Optical fiber networks are also the foundation of wireless 5G and 6G. The Fujikura Groupis one of the few companies in the world that possesses all of the technologies needed tobuild massive optical fiber networks economically. These technologies include optical fiber,
optical cables, fusion splicers, optical connectors, optical components, and construction
for installation. We are taking advantage of the tail wind provided by increased demandfor optical fiber, mainly in North America and Europe, to expand our optical cable businessthrough SWR®/WTC® high-performance optical cable, and also by expanding business inperipheral components and targeting business expansion in SWR® cable solutions. I am

Messages from Management

Rebuilding Fujikura’s brand as a technology
leader and targeting new social contributions
and customer value creation18

Message from the COO
group on achieving carbon neutrality to contribute to achievement of the sustainable
development goals (SDGs) over the medium and long term. This is also an important
initiative in the Production Engineering Unit.

Messages from Management

	Operational Turnaround and Targeting
Subsequent Growth
The terms “structural reform” and “turnaround” probably evoke a strong negative
impression, but I see these as perfect opportunities for the Fujikura Group to change. These
are not just superficial words; they are underpinned by my own experience.
I have been involved in the optical cable business for many years. The optical cablebusiness was previously an outstanding, highly profitable business for Fujikura as well, due
in part to the fact that Japan led the world in building optical cable networks. However,it fell into red ink as the domestic market became saturated, and suffered persistently
severe conditions for four to five years. As we were being asked, “How long will you engage
in a business that is bleeding red ink?” we realized that we had no other choice but tomake drastic changes, and embarked on the challenge of targeting overseas markets
with Fujikura’s unique technologies. SWR®/WTC® was born from that effort. We were able
to transform the optical cable business and generate innovation amid severe, painful
circumstances. This experience taught me that it is necessary to continually metabolizechange precisely because products and businesses have finite lifespans. I definitely want toutilize this experience in the turnaround of Fujikura.
Fujikura is currently experiencing tough, severe circumstances. There is not much needfor big changes when business is steady. However, the current circumstances demandchange. The Fujikura Group will not be reborn if we simply continue doing the same things.
I believe that innovation is born precisely when circumstances are tough and severe. I will
therefore seize the current circumstances as a positive opportunity for change and will
strive to complete the operational turnaround and achieve growth thereafter.

Value Creation with “Tsunagu”
Technology
Business Opportunities

confident that providing solutions while using these technologies will also lead to theresolution of social issues and the creation of value for customers.
Printed Circuit (PC) Business Unit Price competition in FPC for smartphones isintensifying. We will prioritize profitability rather than pursuing scale and concentrateon areas where we can win with highly complex products that add high value amidsuch competition. Under this basic policy, Fujikura will also pursue structural reform tonormalize business scale and refine production technology to reduce defects, improve
productivity, and shorten lead times. In the future, we will use the technologies we havecultivated in FPC for smartphones to break into new markets such in-vehicle and medical.
Automotive Products Business Unit This business unit will focus on profitability
rather than pursuing scale, and we will complete structure reform first to achieve abusiness scale that we can confidently control. To be more specific, we will relocate
production locations in Europe to Morocco and consolidate them, and increase profitability
based on efficient production structure.
We also want to utilize our connections to top customers to create new products andnew businesses on an automotive platform amid a revolution in CASE (Connectivity,
Autonomous, Sharing and Electrification) and other automotive technology on ascale that once in a hundred years. Such products and businesses include high-voltage
harnesses for electric vehicles, electrical power control systems, and rapid charging.
Connector Business Unit This business unit will utilize the strength we cultivated in
the electronics area of being able to produce highly integrated, high-precision connectors
efficiently, to target business expansion in in-vehicle uses and other areas. We began mass
production of high-speed vehicle-to-everything (V2X) connectors for use in vehicles this fiscal
year, for example. The connector market is expected to grow in the future, along with theelectronic optical, and other markets. This business unit would also like to cooperate with theTelecommunication Systems Business Unit in identifying even more new business opportunities.
Electronic Components Business Unit This business unit is an aggregate of highly
profitable niche businesses and possesses many unique technologies. I think theseproducts and technologies can be used in a wide range of domains targeting a future
highly digital society. We will search for ways to use electronic component technologies inmany more business areas; for example, expanding use of components for hard disks andthermal components to data centers. In particular, the growth in demand for data centers
is a market area that the Telecommunication Systems Business Unit is also focusing on, andthese two business units share information as they pursue business.

Fujikura Group Integrated Report 2021

Corporate Governance19

ESG Integration

As I mentioned before, each of Fujikura’s business units possesses many outstanding
technologies that they should be proud of. I also think there are a multitude of new
business opportunities for using the outstanding technologies Fujikura possesses in areasof social change and technological advancement. Business opportunities will expand
enormously if we get the point where we can expand use of such technologies in new
areas, without being confined to existing business areas. To accomplish that, we areestablishing opportunities for each business unit to become familiar with the businesses
and technologies of other business units and are beginning strategic discussions about
whether business units can utilize their mutual strengths to create something new.
The Production Engineering Unit has also been put under the control of the COO,
in addition to these core businesses. I want to strive for even greater active business
contributions than now. While it is important to create new high-performance, highvalue-added products as a manufacturer, this requires new production technology inmany cases. Innovative production technologies are also important for improving pricecompetitiveness. One example of this is in the SWR®/WTC® business, where we also
developed the manufacturing equipment based on the concept of developing new
products and new technologies as a set. This approach is leading to strength in thisbusiness. We will also focus on innovations in core company-wide systems and production
systems utilizing the latest technologies in the future, such as digital transformation (DX),AI, and stress/thermal/fluid analysis simulations. We have also launched a new working

Fujikura Group Integrated Report 2021

20

Messages from Outside Directors
Helping to create a better governancestructure

On April 1, 2021, we enacted drastic changes to our management structure to enable flexible and rapid execution of our 100-Day
Plan to turn operations around.

[After Changes]

Total No. of Personnel: 15

Total No. of Personnel: 10(10 internal, 5 outside)(5 internal, 5 outside)

Internal

Internal

OutsideOutsideIncreased the ratio of outside directors to
50% and strengthened the supervisory
function of management

Hamako Hanazaki
Attorney-at-law

Contributing to Fujikura’s growth anddevelopment as a global company

21

Fujikura Group Integrated Report 2021

Keiji Yoshikawa
Experience in management (manufacturing industry)

Fujikura Group Integrated Report 2021

22

Corporate GovernanceExperience in management (manufacturing industry)

I served as the CEO of Nippon Sheet Glass Co., Ltd. and have experiencein corporate management and in strengthening corporate governancestructures. My role as an outside director of Fujikura is to use my experienceand ideas to assist managers in making decisions concerning challenges andproblems related to management. I will provide advice and recommendations
for efforts such as reviewing the company's business portfolio, and formulatinga medium and long-term management strategy for a growth phase to makeFujikura’s business sustainable.
Fujikura’s strength lies in its technical prowess. And in order to further
enhance this strength, the company needs to cultivate engineers and utilize
IT technology such as DX and IoT. Regarding the cultivation of humanresources, I think one of the most important challenges at present is training
management personnel, including as part of a succession plan. I myself
realized the importance of training management personnel following myexperience as president. This is a common issue for Japanese companies, but
I feel that we lag behind overseas firms when it comes to systematizing thecultivation of management personnel. For managers, changes in the external
environment continue to increase the difficulty of corporate management.
This makes it necessary to systematize the abilities, experience, and otherqualities that leaders of organizations should possess. I hope to help increase
Fujikura’s corporate value by continuing to actively recommend this kind ofsystematization of management training.

ESG Integration

Yoshio Shirai

This is my fifth year as an outside director at Fujikura, and I have watched
the company change first-hand. I think Fujikura is now beginning to see theresults of its efforts toward accomplishing the business revitalization plan.
Hereafter, I think it is important to proceed with delegating authority
to the operations side through corporate governance reforms. It isalso crucial for the Board of Directors to determine what is needed to
become a company that will remain competitive in the global market. To
this end, the board should deepen discussion on various themes such as
Fujikura’s business portfolio, human resource strategy, human resource
development, diversity, and DX.
Creating an image of the kind of company Fujikura should be, andmaking this a reality, requires a strong desire from each and every
employee to support and lift up the company. I feel that the fact thatmost people in management roles see the challenges facing Fujikura as
their own challenges, is a sign of positive change.
I hope to use my managerial experience to thoroughly fulfill my roleas an outside director, and help ensure that Fujikura can continue togrow and develop as a true global company.

Using my own experience to support
management while helping to build a systemfor cultivating management personnel

Business Opportunities■ Messages from Outside Directors

Value Creation with “Tsunagu”
Technology[Before Changes]

This is my third year since being appointed an outside director
for Fujikura. As a lawyer, I have assisted with the planning andimplementation of a system for establishing a risk management
framework at Fujikura. Starting in April 2021, the company abolishedits former governance system and concentrated authority related
to conducting business in the office of COO. At the same time, itestablished the new Corporate Governance Control Division, andtemporarily integrated the functions of legal affairs, internal regulations,and internal auditing. Fujikura aims to accelerate decision-making
through a framework in which the CEO demonstrates strong leadershipto address management challenges facing the entire company. And it isconsidering creating a structure that effectively utilizes governance todiscover and rectify business management risks while moving forwardwith business revitalization. At present, management personnel are
striving to successfully execute the business revitalization phase. At
the same time, they are continuing to discuss how governance can beeffectively utilized to prevent recurrence of past mistakes through efforts
such as clarifying the role that each director should fulfill. Hereafter,
I recognize that an important role will be deeper consideration of amore appropriate governance structure and organizational form forthe coming growth phase. I do not believe that there is an endgame forcorporate governance reform. So, I hope to continue helping to create abetter governance structure at Fujikura from here on out.

Messages from Management■ Reform of Management StructureMessages from Outside Directors

Yoji Yamaguchi
Experience in FinanceKozo Meguro
Certified Public Accountant

Director Skills Matrix
Experience / Abilities / Expertise
Management(CEO)Management(Planning)

Successor
Training

Experience / Abilities / Expertise
Governance

GlobalFinancial Accounting

Legal Affairs andComplianceAttributes
Telecommunication
Networks*

GenderNationality

Male

Japan

Director who is not an Audit &Supervisory Committee Member

Naoki Okada

Male

Japan

Director who is not an Audit &Supervisory Committee Member

Joseph E. Gallagher

Male

U.S.

Director who is not an Audit &Supervisory Committee Member

Masato Inaba

Male

Japan

Director, Audit & Supervisory
Committee Member

Shigeo Sekikawa

Male

Japan

Outside Director, Audit &Supervisory Committee Member

Yoshio Shirai

Male

Japan

Outside Director, Audit &Supervisory Committee Member

Hamako Hanazaki

FemaleJapan

Outside Director, Audit &Supervisory Committee Member

Keiji Yoshikawa

Male

Japan

Outside Director, Audit &Supervisory Committee Member

Yoji Yamaguchi

Male

Japan

Outside Director, Audit &Supervisory Committee Member

Kozo Meguro

Male

Japan

Corporate Governance

Masahiko Ito

ESG Integration

Director who is not an Audit &Supervisory Committee Member* The item “Telecommunication Networks” indicates expertise related to the telecommunications business, which is a driver of sustainable growth and our company’s early stage
business revitalization.

23

Fujikura Group Integrated Report 2021

Fujikura Group Integrated Report 2021

Business Opportunities

As a certified public accountant, I have thus far been involved in areas
such as auditing and due diligence for mergers and acquisitions. Whilestationed in Germany and China in such capacities, I had to seek the truth,
whether good or bad, without judging the other party based on my own
way of thinking. This taught me the necessity of communication andthe importance of open dialogue. This experience has become my basic
stance as an outside director for Fujikura. In particular, I deeply identify
with the idea of “bad news first,” which President & CEO Ito advocates.
My role is to use my expertise as a Certified Public Accountant tobuild the foundation necessary for steadily executing the management
plan. Successful execution of the business revitalization plan is essential
for transitioning from the business turnaround phase to the growthphase. And data-based monitoring is required to ascertain whether
this plan is being appropriately executed. I will check, from an auditing
perspective, whether the route to achieving this goal has been
established, whether indices have been set which front-line workers
understand, and whether there is any disconnect between management
and front-line workers.
Meanwhile, as I was only recently appointed, I will work to makesure management and workers are on the same page by deepening
communication with front-line workers and gaining a deeper
understanding of the current situation at Fujikura.

Value Creation with “Tsunagu”
Technology

I have spent a long time as a member of financial institutions and haveample experience in supporting companies in a variety of industries andbusiness conditions. And I also have experience in managerial auditing
as a full-time auditor. I hope to use my past experience to help improve
Fujikura’s corporate value.
Fujikura’s operations rest on a foundation of extremely high technicalcapabilities. I see this a the biggest reason the company has been able topersist for over 130 years. At the same time, many of Fujikura’s core linesof business are in the mature stage of their lifecycles. A big challenge
facing the company is to leverage its existing high technical prowess
while also developing new markets. It is important for the company
to regularly review its business portfolio, and realign the vectors of its
management resources to future growth areas. But this of course needs
to be backed by numerical data.
By pursuing discussions based on objective data with President& CEO Ito and the other directors, I hope to ascertain future trends
and work toward improving shareholder value. Moreover, amidst a
climate of high uncertainty, further efforts to support globalization anddiversity will be necessary in order to successfully execute Fujikura's
business revitalization plan and return to a growth phase. To thisend, I will also provide proactive recommendations in areas such as
foundational development.

Supporting execution of a management planthat front-line workers can understand andtake decisive action on

Messages from Management

Promoting discussion based on objective
data and help to improve shareholder value

24Top Management (as of June 30, 2021)
Outside Directors

Director, Audit & Supervisory Committee Member

Reappointed

Reappointed

Representative Director, Director & COO

Masahiko Ito

Naoki Okada
Newly Appointed• Chief of the Corporate Governance Unit, Chief of the Corporate Staff
Unit, Chief of the Corporate Finance & Accounting Unit, Chief of the
Corporate• Quality Control Unit, Chief of the Research and New Business
Development Unit, and Chief of the Structural Reforms Task Force• No. of shares held in Fujikura, Ltd.: 57,599• Time in role: 6 years• Responsible for Telecommunication Systems Business Unit, Printed
Circuit Business Unit, Connector Business Unit, Automotive Products
Business Unit, Electrical Components Business Unit, and Production
Engineering Unit
• No. of shares held in Fujikura, Ltd.: 11,845

Outside Director

Keiji Yoshikawa
Newly Appointed

Outside Director

Independent Officer

Independent Officer

Independent Officer• No. of shares held in Fujikura, Ltd.: 0• Time in role: 4 years• No. of shares held in Fujikura, Ltd.: 0• Time in role: 2 years• No. of shares held in Fujikura, Ltd.: 0

Director, Audit & Supervisory Committee Member

Director, Audit & Supervisory Committee Member

Newly Appointed

Newly Appointed

Business Opportunities

Reappointed

Outside Director

Hamako Hanazaki

Director, Audit & Supervisory Committee Member

Value Creation with “Tsunagu”
Technology

Director, Audit & Supervisory Committee Member

Yoshio Shirai
Representative Director, President & CEO

Messages from Management

Directors

Outside Director

ESG Integration

Yoji Yamaguchi

Kozo Meguro

Outside Director

Independent Officer

Independent Officer• No. of shares held in Fujikura, Ltd.: 0• No. of shares held in Fujikura, Ltd.: 0

Corporate Officers
Director

Director, Audit & Supervisory Committee Member

Keiko Shindo
Corporate Governance Unit

Tatsuya Banno
Telecommunication Systems Business Unit

Reappointed

Reappointed

Newly Appointed

Akira Saita
Corporate Staff Unit

Koji Ueda
Printed Circuit (PC) Business Unit

• Responsible for North American Business• No. of shares held in Fujikura, Ltd.: 3,011• Time in role: 3 years• Responsible for Industrial Electric WireBusiness, Marketing & Procurement Unit,
and Real Estate Business Unit
• No. of shares held in Fujikura, Ltd.: 29,257• Time in role: 2 years• No. of shares held in Fujikura, Ltd.: 18,804• Time in role: 9 months*

Kazuhito Iijima
Corporate Finance & Accounting Unit

Jason Peng
Connector Business Unit

* Shigeo Sekikawa was newly appointed as a director
who was not an Audit & Supervisory Committee
member at the 172nd periodic General Meeting of
Shareholders held on September 16, 2020.

Munehisa Fujimaki
Research and New Business
Development Unit

Shuichi Nasu
Automotive Products Business Unit

Joseph E. Gallagher

25

Fujikura Group Integrated Report 2021

Masato Inaba

Shigeo Sekikawa

Junji Fukuhara
Electronic Components Business Unit,
Sales & Marketing Unit

Corporate GovernanceDirector

Tetsuya Mangyoku
Production Engineering Unit

Fujikura Group Integrated Report 2021

26

Value Creation Model

PurposeWhy we exist

Achieving the medium and long-term visionand contributing to a sustainable society
New sustainability
targets ➜ P. 35

Fujikura Group Corporate Philosophy (MVCV) ➜ P. 29

Manufacturing Capital

Re

Technological
Capabilities

pment
velo
De

“Tsunagu” (Connecting)Technologies
Platform consisting of seven technologies
Electric wires & cables Optical Internal wiring in devices
Wireless Sensors

Human Capital

Thermal Superconductors

Contributing to anadvanced informationsociety• Optical fiber cable, FPC,
connectors, etc.

Enhancement of
the Fujikura brand

Customers, Shareholders,and Employees■ Value created• Sustainable growth of Fujikura• Creation of customer value■ Issues recognized• Maintaining & strengthening
competitiveness• Evaluation in the capital markets■ Stakeholders impacted
Customers, shareholders, andemployees

Accessing New Areasof Business(Backcasting)Searching out newtechnologies andbusiness areas

Utilization of various
energy sources andefficient management• Electric power,
telecommunication
cables, etc.

Global Environment
Business Opportunities

Sa
le(Forecasting)

Rapid materialization of next-generation
technologies and products

Concentrating investment
in key areas where
Fujikura’s leadership intechnology is necessary■ Value created• Contribution to transition to carbon
neutrality• Product lifecycle■ Issues recognized• Controlling all GHG emissions• Responding to the risks of climatechange■ Stakeholders impacted
Global Environment

Brand

c tu
ri n

g

Improving quality oflife (QoL)

Possessing excellent customers
and building strong
relationships of trust

Organizational culture capableof responding to change• Medical products, etc.

Three elements ofcompetitive superiority
M a t e ri a

ls

c
Pr o

u

m
re

■ Value createdeContributing to asociety with nextgeneration mobility• Wire harnesses,
charging connectors,
and other products forelectric vehicles (EV)

Input ➜ P. 41

Business Process ➜ P. 45

Output ➜ P. 47

Inputs for businessactivities

Source of value creation

What we deliver to society

Fujikura Group Integrated Report 2021

Society• Abundant lifestyles through anadvanced information society• Improving labor productivity throughHealth Management®
■ Issues recognized• Ethical supply chain management• Ascertaining & responding to social
trends■ Stakeholders impacted
Suppliers, society

Corporate Governance

Minimizing negative
impact on the global
environment, in line withthe long-term vision

Ability to Respondto Social Changes

nt

ufa

Natural Capital

Long-term
Relationships of Trust

ESG Integration

M an

Building deep relationshipsof trust with customers andsuppliers

27

ale
t-s
s
Po
s/

Evolving & Developing
Existing Businesses

p
ow-u
foll

(R&D)

Intellectual CapitalSocial Relationship
Capital“Tsunagu” (connecting) solutions tosolve the problems of a comfortable andsustainable “Mirai” (future) society

&
ch
ar
se

Prioritizing occupational
health and safety while
engaging in rigorously
selected capital investments

Developing humanresources to lead innovationand fostering a culture tofacilitate leadership

Long-term
Environmental Vision
2050 ➜ P. 33

We work with the customer as
one team to provide solutions

Investment in growthbusinesses while also
carefully managing
earnings and assets

2030 Vision ➜ P. 31

OutcomeValue Creation with “Tsunagu”
Technology

Fujikura contributes to customer value creation and society
through our “tsunagu” (connecting) technologies.
Financial Capital

ImpactWhat we strive for

Messages from Management

The Fujikura Group will work with customers as one team to find solutions to issues facing customers and society
through our connecting technologies. This will enable us to achieve sustainable growth of the Fujikura Group andcreate an even better society, based on MVCV, the Group’s corporate philosophy.

* Health Management® is a registered trademark of the non-profit
organization, Kenkokeiei.

Fujikura Group Integrated Report 2021

28

Purpose

Fujikura Group Corporate Philosophy (MVCV)Core Value

Since the start of our Third Era in 2005, we have striven to create new paths based on the Group Corporate Philosophy, MVCV.
In a society that is undergoing dramatic transformation, the Fujikura Group resolves to create new paths with renewed strength,
in order to become a company with the potential to continue long into the future.
• The only way to create these new paths is to provide a value experience exceeding our customers’ imaginations.
• To exceed our customers’ imaginations, we must be fully aware of the issues our customers face, and consider everything from[Commentary]

Customer Satisfaction“Are you doing enough to ensure customers
are perfectly satisfied?”

their points of view.
broad range of knowledge and information as highly-active, flexible, and open-minded teams.

We dedicate ourselves to providing exceptional
products and solutions, earning our customers’
trust and contributing to society.

Tsunagu technology refers to the Fujikura Group’s unique setof capabilities (including skill and knowledge). Through the

Collaboration“As a Fujikura associate, are you driven
to work together with others to deliver the best
possible result for our company?”

In order to respond to ever-changing social and customer
needs, each of us will challenge current norms and values. By
doing so, every one of us is accountable for creating changes
for the better in people, organizations, products, and solutions.
In the Fujikura Group, each one of us acknowledges
individual differences and talents. We encourage and support
one another’s efforts. As a whole, we strive to create products
and solutions that meet the existing and potential needs ofcustomers through cross-organizational cooperation.

application of our technology, we create opportunities toconnect people, information and power sources.
We proactively seek better ways to solve customer issues
using our products, skills, and services. By doing so, we deliver
value that fulfills customer needs and thus contributes tosolving social issues and building a better society.

Vision
We want our customers to reach out to us first with their issues
and concerns. We can ensure this by building trust throughconsistently fulfilling our promises and working together withour customers as their partner of choice. With credibility built

Standards of Conduct

1

Let’s proactively take an interest in social and market trends
and reflect on our work

Show interest proactively

2

Let’s always think about how to provide value that exceeds
expectations

Exceed expectations

3

Let’s be open to diverse opinions and create new ideas

4

Let’s be bold in trying something different

5

Let’s start with our aspirations and work back from those to
calculate what the next action should be

Aspire first6

Let’s be professional and accountable for our own actions

Take ownership with integrity

Embrace different opinions

ESG Integration[Commentary]

Fujikura’s vision is to be the most trusted
partner in our markets.

customers’ viewpoints, think about how to truly fulfill eachBusiness Opportunities

The Fujikura Group’s mission is to create
exceptional value for our customers aroundthe world using “tsunagu” (the Japanese word
meaning “connecting”) technologies.

as fellow employees. We consider internal and external

Value Creation with “Tsunagu”
Technology

Change“Are you willing to take up challenges
to drive progress?”

Finally, the key factor in following this path is for each of us to proceed virtuously as a member of society.

[Commentary]customers and consumers, but also internal customers suchneed, and then reflect this in our products and services.

• To be fully aware of the issues our customers face and consider everything from their points of view, we must strive to acquire a

MissionCustomer satisfaction refers not only to satisfying external

Messages from Management■ Foreword

over time, we can create a better tomorrow for our customers.

Each individual within the company will
endeavor to become an essential player,
thus developing a team that can truly help
Fujikura make its mark on the world stage.
29

Fujikura Group Integrated Report 2021

We strive to always be the pioneers in our field and tohave a positive impact on society. We realize this throughDrive change

being aware of changes in the world. In addition, we
continuously develop products and solutions that meet theexisting and potential needs of our customers.
Everyone in the Fujikura Group understands our common
goal and plays his/her part in achieving it. With everyone
working together as one, the Fujikura Group competes on theworld stage.

Fujikura Group Integrated Report 2021

30

Corporate GovernanceWe strive to become the leading player inour markets by utilizing our “tsunagu”
technologies, and tirelessly developing
innovative and useful products and solutions.

Purpose2030 Vision
Life-Assistance

The Fujikura Group formulated the 2030 Vision in March 2017 because we felt that accurately responding to the issues of the“Mirai” (future) society we aspire to amid the unprecedented scale and speed of change in the world is essential to carving out ourown future. We are working to create new value in four envisioned market areas under the slogan, “The Fujikura Group solves the
problems of a comfortable and sustainable “Mirai” (future) society by continuously providing “tsunagu” (connecting) solutions, andcontinually enhances corporate value.”■ Four Market Areas and Business Opportunities
Contributing to the realization ofan advanced information society

We will improve healthcare, increase health literacy, and contribute to extending the healthy
lifespan of people and improving QoL that extends through a person’s entire life by providing
various solutions aimed at advanced healthcare, local communities, and occupations based on
a QoL platform.

Creating business opportunities and value for society in Fujikura• Expansion into the medical field using existing technology (hearing aids, endoscopes,
pressure sensors)• Expansion of consulting services in the health management field• Joint development of new employment services for people with disabilities through open
innovation

Value Creation with “Tsunagu”
Technology

Advanced Communication

Improving quality of life (QoL)

We will contribute to the realization of a comfortable society that is full of vitality and thaterases the boundaries between people, goods, and information by providing even moreadvanced communication in various forms, based on the evolution of sensing networks.

Creating business opportunities and value for society in Fujikura• Continuous expansion of the telecommunications systems business through optical
networking solutions (optical cables + equipment components + fusion splicers +construction + route design)• Entrance into the 5G mmWave infrastructure market through phased array antenna modules• Establishment of telecommunication infrastructure to handle the growth in data transmission
capacity (wireless and 6G, Innovative Optical and Wireless Network (IOWN) concept, etc.)
Fusion Splice Tray
Optical Closure

Fiberscope using image fibers

IVUS* catheter

WABE* Package®, a device-embedded board built
into thin components

Business Opportunities

Optical Connectors

Electronic scope using CMOS

Factory Processed
Products* For Intravascular ultrasound examination

SWR®/WTC®

Messages from Management■ What is the 2030 Vision?

* WABE: Wafer And Board level device Embedded package

Optical Network Solutions

VehicleEnergy & Industry

Efficient management using a broad range of energy sources

Creating business opportunities and value for society in Fujikura• Demand for renewable energy transmission cables, upgrades, etc. in the renewable energy area
• Supporting new technological innovations in the superconductor technology area
• IoT solutions using dye-sensitized solar cells (DSSC), which are environmentally friendly
power generation devices

We will contribute to the realization of a society that enables comfortable and safe mobility
and transport by providing new means of mobility that anyone can enjoy, the means totransport goods on-demand at a low cost, and the transportation infrastructure and systems to
support those means.

Creating business opportunities and value for society in Fujikura• Supporting electric vehicle (EV) demand with rapid charging connectors, etc.
• Organic use of technologies Fujikura possesses in the electronics field, such as FPC,
connectors, sensors, and thermal• Technological support for MaaS start-ups for realizing a society with new forms of mobility

ESG Integration

We will contribute to the realization of sustainable planet by building systems for highlysustainable power sources, storage, and management that will result in a stable supply ofenergy, and by using processing technology and digital technology powered by highly
efficient, high density energy to achieve advanced manufacturing.

Contributing to a society with next-generation mobility

Corporate GovernanceHigh voltage CV cables for grid connection

31

Fujikura Group Integrated Report 2021

High-temperature superconductor (HTS) tape

Rapid charging connector

Fujikura Group Integrated Report 2021

32

Purpose

Fujikura Group Long-term Environmental Vision 2050
To Achieve Carbon Neutrality

The response of the Fujikura Group began with the establishment of the Fujikura Group Global Environmental Charter in 1992.
It specifies our policy on environmental activities that are consistent with our management strategy, which we formulated
by referencing the forecasts of external institutions. In 2016, the Fujikura Group performed a scenario analysis using theMain Initiatives
Zero CO2
emissions at plants

Intergovernmental Panel on Climate Change (IPCC) RCP 2.6* (a scenario of a 2°C increase in temperature) and established FujikuraGroup Long-term Environmental Vision 2050. We are working on four challenges aimed at minimizing negative environmental
impact by the future target of 2050.

History of Climate Change Initiatives
Established the Fujikura Group Global Environmental Charter

Jul. 2012

Began responding to CDP Climate Change questionnaire

Apr. 2013

Revised the Fujikura Group Global Environmental Charter (to add protection of biodiversity)

Long-term Environmental Vision 2050
Challenge 1

Became a signatory supporting the UN Global Compact

Sep. 2013

Jul. 2016

Established Fujikura Group Long-term Environmental Vision 2050

Jul. 2017

Began responding to the CDP questionnaires on water and the supply chain

Apr. 2019

Became a supporting member of the Japan Climate Leaders’ Partnership (JCLP)

Jul. 2019

Became a Task Force on Climate-Related Financial Disclosures (TCFD) supporter

Oct. 2019

Joined the RE100 global corporate leadership initiative

Apr. 2021

Enacted Ver. 6 of the Fujikura Group Environmental Activity Guidelines (FY2021 to FY2025)

The Fujikura Group has joined the RE100 and istargeting use of renewable energy for 100% ofelectricity used in business activities. We aim toreach our target of 100% renewable energy use
for electricity in 2050 by setting 45% in 2030
and 90% in 2040 as interim goals.

•	Currently working on obtaining SBTi approval• Projects selected for support by the Ministryof the Environment

Roadmap to Zero CO2 Emissions
Energy usage forecast

The Four Challenges in Fujikura Group Long-term Environmental Vision 2050

1

Zero CO2 emissions at
plants by 2050

3

Symbiosis between
plant workers and nature

33

Fujikura Group Integrated Report 2021

Targeting net zero emissions based on
a combination of energy conservation,use of renewable energy,
carbon credits, etc.

2

Minimize use of water atplants and wastewater
management
Challenge

4

Effective use of resources
and resource cycle

Total CO2 emissions volume
Net zero
total CO2
emissions2020

CO2 reduction
targets set

2025

2030

[Short-term] FY2025:
Reduction of at least 20%
compared to FY2018[Medium-term] FY2030:
Reduction of at least 40%
compared to FY2018

Renewable energy reduction targets

Renewable energy for
45%

2040

2050

Corporate Governance

Challenge

Challenge

To achieve carbon neutrality, we plan to expand
initiatives to our supply chain in addition to
pursuing initiatives in Fujikura and its Group
companies. Fujikura is currently engaged in
activities aimed at obtaining SBTi approval,
which we plan to obtain in FY2021.

ESG Integration

Enacted Ver. 5 of the Fujikura Group Environmental Activity Guidelines (FY2016 to FY2020)

Business Opportunities

Apr. 2016

Pursuing
decarbonizationof the supply chain

Promoting useof renewable energy

WE SUPPORT

Challenge

Value Creation with “Tsunagu”
Technology

One of the challenges set in Fujikura Group
Long-term Environmental Vision 2050 is net zeroCO2 emissions at plants by 2050. We establisheda roadmap for reducing CO2 emissions andwill implement specific measures that include
promoting energy conservation, using nonfossil fuels, certifying carbon neutral plants, andestablishing an energy conservation fund in-house.

* RCP 2.6: The Fifth Assessment Report of the IPCC (published in 2014) details four scenarios of how much the average temperature will rise over the next 100 years. This is
the lowest temperature increase among the four scenarios.

Apr. 1992

Messages from Management■ Fujikura Group Policy on Responding to Climate Change(Fiscal year)[Long-term] FY2050: Challenge of net zero
total emissions at plants
Renewable energy for
90%

Renewable energy for100%

Fujikura Group Integrated Report 2021

34

Purpose

Sustainability Targets 2025
STEP 2

We need to engage in two types of activities to achieve sustainability based on the Fujikura Group Corporate Philosophy (MVCV):
Activities necessary for sustainable corporate management and activities that facilitate building a sustainable society.
Up to this point, we have specified the five-year CSR Priority Measures 2020 (FY2015 to FY2020) as environmental and social
materialities and pursued each measure in cooperation with the relevant divisions. However, rapid social changes after establishingtargets have necessitated radical revisions. We therefore established targets that also added the perspective of financial materialities

Reformulated core SDG targets

The Fujikura Group established six core SGD targets to focus on in 2016 and linked these to the CSR Priority Measures. These targets
were revised from the perspective of financial materialities when establishing Sustainability Targets 2025. We discussed internallywhat contributions the Fujikura Group businesses can make toward achieving the SDGs. The targets were revised to the following
four core targets based on the opinions voiced during discussions and management opinions.

to environmental and social materialities in our new 5-year Sustainability Targets 2025 (FY2021 to FY2025), beginning in FY2021. We
have set more future-oriented goals by linking this to the long-term visions the Fujikura Group has established (the 2030 Vision andFujikura Group Long-term Environmental Vision 2050).

Current
Environmental and Social Materialities

FutureFinancial materialities added

Value Creation with “Tsunagu”
Technology

Sustainability Targets 2025 was deliberated and approved by the Sustainability Strategy Council (chaired by the president).

Six core SDG targets the Fujikura Groupis working toward

Sustainability Targets 2025 Formulation Process
Reflect

Ascertain the latest trends

Set goals

Sort out governmental trends, the demandsof ESG rating institutions and ESG investors,
and other external environmental factors(1) Verify results of Fujikura GroupCSR Priority Measuresfor 2015-2020.
(2) Six SDG targets Fujikura
is working toward

Set top priorities (materialities)
and targets to achieve withproposed KPIs

* Main sources for compiling information
Ministries and agencies, ESG rating institutions,
Principles for Responsible Investment (PRI) andthe UN Global Compact, and dialogs with
ESG-based institutional investors* Implemented by the officer in chargeof each and progress reports in
Sustainability Strategy Council meetings

Business Opportunities

Introduced double materiality perspectives

STEP 1

When establishing Sustainability Targets 2025, we verified the results of CSR Priority Measures 2020 and sorted out the newperspectives that should be incorporated based on the latest trends. To ascertain the latest trends, we referenced domestic andinternational issues and international guidelines, the elements rated by ESG rating institutions, and comments from stakeholders.
We also added the perspective of F (Finance & Future), incorporated the impact of environmental and social aspects

Contribution to SDG Targets
Core SDG targets

Messages from Management■ Views on Sustainability Targets 2025

TargetKeyword

Associated 2030 Vision

on corporate performance, and considered achievement of the 2030 Vision and other long-term visions of the Company in
Sustainability Targets 2025.

“Tsunagu” (Connecting)Technologies

Energy and Industry

Target 8.2: Achieve a high level of economic productivity
through diversification, technological improvements,
and innovation by prioritizing sectors offering highadded value, labor-intensive sectors, etc.

Engagement

Quality of Life

Target 9.1: Develop highly reliable, sustainable, resilient
local and trans-regional infrastructure and support
economic development and human welfare focused on
inexpensive access for everyone.

“Tsunagu” (Connecting)Technologies

Advanced Communication /Energy and Industry / Vehicle

Target 13.1: Strengthen resilience and adaptability to
climate-related disasters and natural disasters in all
countries.

Climate Change
Mitigation

Advanced Communication

ESG Integration

Target 7.1: Secure universal access to inexpensive andreliable modern energy services by 2030.

Expansion to ESG + F (Finance & Future)

Environmental and Social Materialities

E

S

Environment

SocialFinancial Materialities

Finance & Future

Corporate GovernanceF

G
Governance

Reduce negative impact
35

Fujikura Group Integrated Report 2021

Generate positive impact
Fujikura Group Integrated Report 2021

36

Purpose
Sustainability Targets 2025

Created a materiality matrix

STEP 4

Added new targets

The Fujikura Group created a materiality matrix specifying the themes of Sustainability Targets 2025 based on the Fujikura Group

When establishing Sustainability Targets 2025, we verified the results of CSR Priority Measures 2020 and sorted out the new

CSR Basic Principles and the four focus areas. We performed a materiality matrix analysis with stakeholder inclusiveness in mind,

perspectives that should be incorporated based the latest trends. To ascertain the latest trends, we referenced domestic andand evaluated and verified materiality from the two perspectives of the degree of stakeholder concern and degree of impact oninternational issues and international guidelines, the elements rated by ESG rating institutions, and comments from stakeholders.

Messages from Management

STEP 3We also added the perspective of F (Finance & Future), incorporated the impact of environmental and social aspects

Fujikura’s business.
This resulted in establishment of three items in F (Finance & Future), five items in E (Environment), three items in S (Social), andfive items in G (Governance). The targets and results are evaluated annually with the goal of achieving them by FY2025. Progress on
the targets is disclosed in the Integrated Report and on the corporate website every year.

on corporate performance, and considered achievement of the 2030 Vision and other long-term visions of the Company in
Sustainability Targets 2025.

Four Sustainability Themes According to ESG + F

Finance & Future (F)F• Fujikura Group Long-term
Environmental Vision 2050
(pursuing the Four Challenges)• Response to TCFD recommendations• Achieving the 2030 Vision• Further expansion of environmentallyfriendly products• Promoting digital transformation(DX)

G• Human resources capable of active
contribution globally• Workstyle reform• Diversity & inclusion• Added a long-term perspective of achieving carbon
neutrality (linked to Fujikura Group Long-term
Environmental Vision 2050).
• Added response to TCFD recommendations(consideration of economic feasibility in reducing CO2
emissions and business performance).
• Included human resource development and diversity& inclusion linked to employee engagement andmanagement strategy to strengthen the perspectiveof “business and human rights.”

Social (S)• To protect the human rights of employees, we managed working
hours, conducted anti-harassment training, implemented othermeasures, and also established a telecommuting environment
and encouraged male employees to take childcare leave, etc.
• For the supply chain, we communicated the demand to respecthuman rights, etc. through the CSR Procurement Guidelines, inaddition to continuing to hold Partners Meetings and provide
other networking opportunities.

Governance G)• Held workshops on interpreting the Fujikura Group Corporate
Philosophy (MVCV), used MVCV Book to instill MVCV in all
employees, and will reinforce future initiatives.
• In information disclosure and communication, continued to be
included in the ESG Index and strengthened ESG meetings withinstitutional investors, among other efforts.

STEP 5* Moved supply chain to Governance (G) in Sustainability
Targets 2025.

• Incorporated establishment of Board of Directors
functions under the revised Corporate Governance
Code, putting the Fujikura Group Corporate
Philosophy (MVCV) into practice, and strengthening
supply chain engagement.

Deliberated in Sustainability Strategy Council

The administrative office first produced a draft proposal and discussed it with each division when establishing the priority measures,targets to achieve, and measures and indicators for achieving the targets in Sustainability Targets 2025. Progress reports were
subsequently presented and deliberated in Sustainability Strategy Council meetings, and Sustainability Targets 2025 was approvedin August 2021 at the second Sustainability Strategy Council meeting in FY2021.

Overall Image of Sustainability Targets 2025
Corporate Philosophy

Four Sustainability ThemesF

Achieving the 2030 Vision (CSV)

E

Achieve Fujikura Group Long-term
Environmental Vision 2050

S

Develop a pool of human resources
with globally versatile talentG

Strengthen corporate governance

Strive to contributeto a sustainable
society andenhance corporate
value

Each of us must follow an ethical path as a member of society.

37

Fujikura Group Integrated Report 2021

Fujikura Group Integrated Report 2021

38

Corporate GovernancePutting the
Fujikura Group
Corporate
Philosophy(MVCV) into
practice

Existing Value
Double materiality
Also considered the financial impact
in addition to the CSR perspective

Degree of impact on Fujikura’s business (internal factor)• Generally achieved reduction of CO2 emissions and water usage.
• Also continued activities in protecting biodiversity, mainly inFujikura Kiba Millennium Woods.

ESG Integration• Establishing Board of Directors functions• Putting Fujikura Group Corporate
Philosophy (MVCV) into practice• Building Group governance• Strengthening supply chain
management• Comprehensive security export
control management

S

Environment (E)Additions to Sustainability Goals 2025
• Incorporated the impact of environmental and social
aspects on corporate performance.
• Added development of existing businesses andfinding new areas of business in the four market areas
specified in the 2030 Vision.
• Added pursuit of digital transformation (DX).

Business Opportunities

Degree of stakeholder concern (external factor)

E

Results of CSR Priority Measures 2020
• Pursued CSV as a strategy for contributing to the achievements ofprofit growth for Fujikura and SDGs. Organized internal educationand concrete initiatives.

Value Creation with “Tsunagu”
Technology

Sustainability Theme

Materiality Matrix (with only high priority items excerpted)

Purpose
Sustainability Targets 2025

Theme

Finance &Future(F)
Maximizing
opportunities toachieve the 2030
Vision (CSV)

Priority Measure

Strengthening Governance of Sustainability

Target to Achieve in FY2025 (Key Goal Indicator (KGI))

Solve problems in a comfortable andsustainable “Mirai” (future) society byproviding “tsunagu” (connecting) solutions
and thereby continuously enhances
corporate value

Find new businesses in the four areas envisioned in the 2030 Vision(1) Evolve and develop core technologies in existing businesses• Expand core technologies and develop products and services that add high value• Sell products and services for which there is a high willingness to pay (WTP)(2) Find new technologies and business areas• Also consider open innovation• Find businesses through the sale of information as well as the sale of goods

Develop products that are friendly to theglobal environment and can be used withconfidence

Replace all Fujikura products with environmentally friendly products (Green-related products) by 2050.
FY2020 results: Approx. 40%

Launch of Sustainability Strategy Council Meeting
Since 2009, the Fujikura Group has mainly pursued sustainability through a management structure centered on theGroup’s CSR Committee.

Expand green product creation activities to the entire Group in 2030.
FY2020 results: One company in Japan (Nishi Nippon Electric Wire & Cable Co., Ltd.)■ Improve production efficiency (pursue energy conservation)
Intensity of energy used for production (versus net sales): Improvement of at least 10% in FY2025,
compared to FY2020

Japan
Overseas■ Improve product distribution efficiency
Intensity of energy for product distribution: Improvement of at least 5% in FY2025, compared to
FY2020Japan■ Contribute to reduction in water risks
Water usage intensity: Improvement of at least 5% in FY2025, compared to FY2020

Japan
Overseas

monitoring and supervision, and in execution.

[Challenge 3]■ E ffectively utilize nature at business sites and contribute to expansion of biodiversity
Symbiosis between plant workers and nature ■ Pursue local activities to preserve the natural environment

Japan
Overseas[Challenge 4]
Effectively use resources and resource cycle■ Reduce resource inputs and promote efficient use of resources

Japan
Overseas■ Reduce amount of waste generated in business activities
Intensity of waste generated: Improvement of at least 5% in FY2025, compared to FY2020

Japan■ Achieve net zero waste generation

Japan

Build climate change governance system(response to TCFD recommendations)(1) Ascertain risks and opportunities of climate change(2) Ascertain impact on strategy and financeJapan
Overseas

Implement workstyle reform (strengthen
engagement)

Ensure that employees grow as a person through self-actualization in both their public and private lives• Increase the motivation of employees to contribute independently• Establish an environment where people can work anywhere, at any time
• Improve motivation through health management • Improve labor productivity

Develop globally versatile human resources
Diversity & inclusion(Respecting the human rights of employees)

Maintain Board of Directors functions● All Fujikura Group employees acting from a global perspective•C reate a corporate culture in which the growth of employees is synchronized with the growth of thecompany• Develop, find, and acquire human resources to lead innovation• Support independent career development and provide opportunities for growth•C reate an organization in which employees mutually recognize and improve one another (individual
respect and trust)● Active contribution by human resources who possess diverse backgrounds and views•A n environment where diverse individuals can actively contribute•P rovide career opportunities regardless of nationality, ethnicity, gender, religion, age, or other attributes•C onsider physical or sexual minorities
Enhance medium and long-term corporate value• Improve effectiveness of the Board of Directors and strengthen the supervisory function• Increase transparency and impartiality in management and strive for swift decision-making• Ensure diversity of the Board of Directors
Growing the leaders who will become the CEOs and other leaders of the next generation• Formulate and employ successor plans • Appropriately supervise development plans

Strengthen
corporate
governance39

Put the Fujikura Group Corporate Philosophy(MVCV) into practice

Each of us must follow an ethical path as a member of society• Implement a new code of conduct for putting the Fujikura Group Corporate Philosophy (MVCV) into
practice

Build Group Governance(Strengthen the risk management structure)

Build a risk management structure that facilitates strategic management and control risks (PDCA)

Supply chain management(including responsible mineral sourcing)• Establish supply chain management that addresses social issues (child labor, forced labor, etc.)• Establish a system of responsible mineral sourcing (a system for performing due diligence, mainly on the
3TG minerals (Tin, Tantalum, Tungsten and Gold), as well as cobalt, mica, and other minerals• Zero findings by NGOs and other external organizations (or rapid correction when there are findings)• Cooperate with other companies (learn from the initiatives of other companies and use such lessons inFujikura’s own initiatives)

Comprehensive security export control• Comply with export control laws and regulations
Number of serious legal violations: 0 incidents/year

Fujikura Group Integrated Report 2021

Strengthen investment management

Board of Directors (chaired by the president)• Makes decisions on main action plans, reviews matters,
and provides guidance. Monitors and supervises
climate change response goals and progress onachieving those goals.

Sustainability Strategy Council(Chairperson: President; Committee members:
Members of the Management Committee)• Shares and deliberates on policies and measures for
Fujikura Group ESG activities.

Determines
strategy
Monitors &supervises

Report on
execution
statusExecutive function

Manager in charge of department(in charge of non-environmental issues)

Global Environment Committee(Chairperson: Director in charge of environment;
Committee members: Related line managers)

Green Product Management Committee• Implements overseas global environmental protection
activities, formulates annual and medium-term goals,
including climate change goals, and monitors progress
toward achieving these goals.
• As the screening organization for Green products
awarded the Green Project logo and Green Mind
products, the committee uses a proprietary check sheet
and approves and registers products that meet or
exceed the standards.

Council Member List
Masahiko Ito, Director, President & CEO; Naoki Okada, Director & COO; Masato Inaba, Director; Shigeo Sekikawa,Director, Audit & Supervisory Committee Member; Keiko Shindo, Corporate Officer; Akira Saita, Corporate Officer;
Kazuhito Iijima, Corporate Officer; Munehisa Fujimaki, Corporate Officer; Tatsuya Banno, Corporate Officer; Koji Ueda,
Corporate Officer; Shuichi Nasu, Corporate Officer; Junji Fukuhara, Corporate Officer; Tetsuya Mangyoku,
Corporate Officer; Masataka Mito, Division General Manager

Corporate Governance

Governance(G)sustainability management system was updated at the same time to clarify the roles of existing meeting bodies in

ESG Integration

Develop a pool ofhuman resources
with globallyversatile talentJapan
Overseas

Administrative Office(Corporate Communications Div.)

Social(S)[Challenge 2]
Minimize use of water at plants andwastewater management

ESG perspective into business plans, enhance corporate value, and achieve sustained growth (sustainability). The■ Reduction in total CO2 emissions
FY2025 target: Reduction of at least 20% compared to FY2018 (to 350,000 tons/year or less)
FY2030 target: Reduction of at least 40% compared to FY2018
FY2050 target: Net zero CO2 emissions at plants

Business Opportunities

Achieve FujikuraGroup Long-term
Environmental
Vision 2050

The existing CSR Committee established the new Sustainability Strategy Council meetings to incorporate theValue Creation with “Tsunagu”
Technology

Environment(E)

In recent years, striving for sustainable growth based in ESG activities, rather than corporate social responsibility(CSR) alone, is being viewed as important, in an era where society is demanding response to climate change issues andinstitutional investors are basing investments on ESG.

Use data and digital technologies to improve (1) DX at manufacturing sites (conversion to smart factories and use of AI)
the efficiency of existing businesses and(2) DX in the Sales & Marketing Unit (digital marketing)create new business models[Challenge 1]
Zero CO2 emissions at plants by 2050

Messages from Management■ Sustainability Targets 2025 List

Main Tasks in FY2020• Considered FY2020 results of CSR activity plans, and the new sustainability targets for 2025
• Reported on holding of Global Environment Committee meetings• Responded to demands for sustainability from customers• Shared comments received from institutional investors at ESG meetings• Determined editorial policy on and content of Fujikura Group Integrated Report 2021, etc.

Fujikura Group Integrated Report 2021

40

InputCapital for Value Creation■ Natural Capital

Net Sales/Operating Income

Net Sales by Region and Japan/Overseas(Billions of yen)Overseas

653.7

740.0

710.7

34.3

672.3

27.6

34.2

643.7

Environmental impact accompanying business activities

428.5 billion yen
67%

INPUT

24.4
Other

112.0 billion yen
2016

2017

2018

2019

U.S.

2020

Energy BusinessTelecommunication Systems BusinessElectronics Business

Automotive Products Business

Other

215.2
billion yen

FY2020Net sales

167.5

33%

643.7 billion

billion yen¥

Asia (excluding Japan)

Raw materials(tons)● Optical fiber cables

GHG emissions(tons)● Municipal gas● Electrical wires and cables● CO2 from energy sources● Electronic equipment

125,213

8,488● Silicon tetrachloride 4,150● Copper91,020

components● CO2 from product● Polyethylene12,103● Automotive components● PVC10,649● Industrial wiring● Aluminum7,066● Manufacturing of cable● Steel1,525

148.8 billion yen

Operating Income

OUTPUT

distribution3,398
Waste (tons)● Waste generated

connector components, etc.

● Of which, final disposal  66

Energy (Gigajoules)
Net Income and ROE

Cash Flows(Operating, Investing, and FCF)
ROE (%)

Operating cash flow (Billions of yen)
Investing cash flow (Billions of yen)

8.7
6.43
12.9

43.6
18.3

Free cash flow
(Billions of yen)

0.67
1.4

–38.5

42.0

46.4

62.6

● PRTR*1 releases● Tap water –0.34● Industrial water

845,109● Groundwater 

1,187,870

–34.3

63.4

● VOC* emissions

48*1 PRTR: Pollutant Release and Transfer Register*2 VOC: Volatile Organic Compounds

CO2 Emissions by Scope (Japan)

2016

2017

2018

Capital Investment Expenses(Billions of yen)(Billions of yen)

262

245
2019

56.9

257

57.9
248

243

1,200,000

1,000,000

2020 (Fiscal Year)
170

Research and Development Expenses

58.5

173

159

ESG Integration

2020 (Fiscal Year)17

CO2 emissions (t-CO2)

58.8

–39.4

–60.6
2019

and transfers 
2CO2 Emissions and Intensity Based on Net Sales

–0.23

–48.1
–20.9

235,277

–7.1
–1.43

2018

Water resources(tons)

58.1

–3.41

2017

Chemical substances(tons)

27.8

–5.4

10.6

2016

2,790,863

800,000

140

125

600,000

400,000

15.6

17.4
16.2

17.2

55.7

16.5

2016
45.6

2017

(Thousand t-CO2)

42.5Group emissions in Japan
Group emissions overseas

17.7

2016

41

2017

2018

2019

Fujikura Group Integrated Report 2021

2020 (Fiscal Year)

2016

2017

2018

2019

2020 (Fiscal Year)

2018

2019

2020 (Year)(t CO2/100 million yen)

200,000

0

2016

Intensity based on net sales(Emissions volume/Net sales)• Electric power CO2 emission coefficient[Japan]FY2013 to FY2017: Published on December 5, 2013 by the Ministry of
the Environment and Ministry of Economy, Trade and Industry
Fixed emission coefficients by electric power provider
FY2018 to FY2019: Adjusted emission coefficients by electric power
provider published by the Ministry of the Environment and Ministryof Economy, Trade and Industry (using the coefficients from the mostrecent fiscal year)[Overseas] FY2013 to FY2018: “CO2 emissions per kWh from electricity generation”
fixed at the FY2012 values, published by IEA in 2014
FY2019 and FY2020: “CO2 emission factors for electricity only generation”
published by IEA (using coefficients for the most recent year)

Scope 1

2017

2018

Scope 220192020 (Fiscal Year)

Scope 3-1 Purchased goods and services
Scope 3-3 Fuel- and energy-related activities

Scope 3-2 Capital goods

Scope 3-4 Transportation and distribution (upstream)
Scope 3-5 Waste generated in operations

Scope 3-6 Business travel

Scope 3-7 Employee commuting

Scope 3-8 Leased assets (upstream)

Scope 3-9 Transportation and distribution (downstream)
Scope 3-10 Processing of sold products

Scope 3-11 Use of sold products

Scope 3-12 End of life treatment of sold products
Scope 3-13 Leased assets (downstream)

Scope 3-14 Franchises

Scope 3-15 Investments

Fujikura Group Integrated Report 2021

42

Corporate Governance

30.1

Business Opportunities

Net income (Billions of yen)

10,157

Value Creation with “Tsunagu”
Technology

3.3

Japan

Manufacturing

Messages from Management■ Financial CapitalInputCapital for Value Creation■ Intellectual CapitalGroup Employees

Employees by Business Unit

(No. of people)(No. of people)

56,96158,42257,22855,93653,717Japan

Americas

132

373

179

667

2,707

2016
2019

No. of products

314
413

366
210

734

430
818

236

372
447
204
844

361
430

Percentage of net sales (%)
739
665
597

536
474

872

2,993

2,978

2,981

2,840

2017

2018

2019

2020 (Fiscal Year)

37.1

37

37

40

37

2016

2017

2018

2019

2020 (Fiscal Year)

2020 (Fiscal Year)

Employees by Region

Percentage of People with Disabilities Employed(Fujikura)(No. of people)(%)

Official Fujikura Group Accounts

Japan
5,805

LinkedInBusiness Opportunities

Europe & Africa
9,846

Other

• America Fujikura Ltd.
https://www.facebook.com/AFLcorp

2.05

Asia
(excluding
Japan)
21,665

North &South America
16,401

Value Creation with “Tsunagu”
Technology

Electronics
13,505

2018

China

(No. of patents)

280

Automotive
Products
27,6912017

Europe(No. of patents)

Telecommunication
Systems
11,283

2016

Number of Environmentally Friendly Products
Developed and Percentage of Net Sales

Number of Patents Held(in Japan and internationally)

Real Estate and Other
1,238

Messages from Management■ Human Capital

2.12

2.22

2.29

2.39

• Fujikura Ltd.
https://www.linkedin.com/company/fujikura-ltd-/

Medicalhttps://www.linkedin.com/company/fujikura-medical/• Fujikura Europe Ltd.
https://www.facebook.com/FujikuraEuropeLtd• Fujikura Asia Ltd.
https://www.facebook.com/FujikuraAsiaLimited

mmWave
2016

2017

2018

2019

2020 (Fiscal Year)https://www.linkedin.com/company/fujikura-mmwavetech-team/YouTubeSuperconductors• Fujikura Ltd.

■ Manufacturing Capital• America Fujikura Ltd.
https://www.linkedin.com/company/afl-2/• Fujikura Europe Ltd.

ISO 45001 Certifications Obtained (Group)

Lost Time Accident Rate (Fujikura)https://www.linkedin.com/company/fujikura-europe-ltd/(Rate)(No. of companies)

5
0.34

0.37

• Fujikura Asia Ltd.
https://www.linkedin.com/company/fujikura-asia/

0.18

0.18

• Fujikura Ltd.

2https://www.facebook.com/FujikuraLtd

1
0
2016

43

2017

2018

2019

Fujikura Group Integrated Report 2021

2020 (Fiscal Year)

0

0

2016

2017

• America Fujikura Ltd.
https://www.youtube.com/channel/
UCHjhdvfS5rKyAHRf3phPsA• Fujikura Europe Ltd.
https://www.youtube.com/user/FujikuraEuropeLtd

Twitter
Corporate Governance

Facebook

https://www.youtube.com/channel/UCQsU4lsfBEEJh_
asJ3fagPg

ESG Integration

https://www.linkedin.com/company/
fujikurasuperconductor/• America Fujikura Ltd.
https://twitter.com/AFLglobal• Fujikura Europe Ltd.
https://twitter.com/FujikuraEurope/

Fukagawa Gatharia
https://www.facebook.com/fukagawa.gatharia

2018

2019

2020 (Fiscal Year)

Fujikura Group Integrated Report 2021

44

Business Process

Sources of Value Creation■ Three Advantages Providing Competitive Superiority

The Fujikura Group views value creation from the perspective of the general public, what services they really need, and how to meetand resolve their many needs and issues in their lives. Together with our customers, we survey the society and lifestyles that weshould expect and create the products and services desired.
The Fujikura Group utilizes its outstanding technologies and knowledge to achieve the best solutions for social problems
through “tsunagu” (connecting) technologies. In other words, we contribute to achieving the sustainable development goals (SDGs)
by providing value in both products and services.
Features• We can quickly ascertain the need for products andtechnologies and develop them, based on our close
relationships with our customers.

Challenges• Establishing and pursuing R&D themes proactively
to respond to rapid changes in technology in theworld

Strengths

Challenges• Relationships of trust and cooperation with
suppliers (Social relationship capital)• Development purchasing(Intellectual and human capital)• Buyer skills (Human capital), etc.

Strengths

Manufacturing• We engage in small group activities at eachplant and continually work for improvement at
production sites.
• We pass on technical skills to technicians at plants
in Japan and overseas, and conduct hands-on
practice and training to improve technical skills.

Challenges• Using IoT to improve productivity (smart factory
concept, etc.)• Shifting to production equipment and production
processes that contribute to global environmental
protection and reduction in CO2 emissions

Strengths

Challenges• Strengthening initiatives aimed at reducing
environmental burden associated with the
distribution, product use, and product disposal• Ascertaining participation in human rights
infringement through the unintended use of
products soldTechnological Capabilities (R&D)“Tsunagu” (connecting) technologies to solve
social problems

The Fujikura Group has built technology platforms for creating high added value in the
Telecommunication Systems, Electronics, and Energy areas. We are expanding initiatives infurther evolution of our “tsunagu” (connecting) technologies based on those platforms.
As digital transformation progresses in all domains of society, we are accelerating new
R&D through collaboration with research institutions, open innovation, and other efforts
in Japan and overseas. These efforts are aimed at being a company that provides products
and services which solve social problems.

New 90S+ core alignment fusion splicer

Technological
Capabilities(R&D)

Long-term
Relationshipsof Trust

Ability to
Respond to
SocialChangesCompetitive advantage 2Long-term Relationships of Trustwith Customers

Customers
Consultation on
new productdevelopment, etc.

We work with the customer as one team toprovide solutions• Production plants and equipment(Manufacturing capital)• Accumulated production technology andexpertise (Intellectual capital)• Technical production skills (Human capital)• Suppliers and local communities(Social relationship capital)• Steel materials, components, oil, electric power,
water, and other raw materials (Natural andmanufacturing capital) etc.

The Fujikura Group integrates sales, business units, manufacturing, and development toprovide products that meet the needs of customers. The Fujikura Group builds strong
relationships with customers and works with customers as one team to provide solutions
by meeting the needs and exceeding the expectations of customers. We call this “customer
value creation.” We are working to ensure sustainable growth of the Fujikura Group andcreate a better society by finding solutions to issues experienced by customers and society.
We accomplish this by making customer value creation part of the business activity cycle.

Technological
Capabilities(R&D)• Sustained customer contact in post-sale followup (customers, agencies, sales locations) (Social
relationship capital)• Product investigation and analytical data
(Intellectual capital) etc.

SWR®/WTC®

Long-term
Relationshipsof Trust

Ability to
Respond to
SocialChanges

Provision ofsolutions andstable supply

Fujikura Group
Search out the latent needs of ourcustomers’ end-users and society anddevelop products and services
demanded by the public.

Fujikura’s concept for building relationshipsof trust

Competitive advantage 3

Ability to Respond to Social Changes
The ability to maintain resilience developed byovercoming difficulties

Fujikura has always succeeded in recovering from the numerous disasters it has
experienced. Our high degree of unyielding resilience in the face of difficulties is a partof Fujikura’s DNA. The major flooding in Thailand is 2011 is a symbolic example of this.
Fujikura Group manufacturing locations also suffered catastrophic damage, but the entire
Group exhibited strong will in working as one team on recovery and restoration, andwe declared recovery from the flooding complete in 2016. We were also able to recoversuccessfully precisely because of our deep relationships with our customers, who havegiven us another chance.

Flooded plant in Thailand

Corporate Governance

Sales/Post-sale
Follow-up• We have accumulated advanced analyticalexpertise and technology based on a wide rangeof data on customer and end-user malfunctions,breakdowns, etc.

Ability to
Respond to
SocialChanges

Declaration of recovery from flooding in 201645

Fujikura Group Integrated Report 2021

ESG Integration

Customer Needs (Needs of Society)• Stable procurement (ensuring flexibility in supply,
more effective BCP implementation)• Reducing environmental burden throughout
the supply chain (appropriate management ofenvironmentally burdensome substances, measures
to combat global warming)

Long-term
Relationshipsof Trust

Business Opportunities

Materials
Procurement• We achieve a high level of quality, cost, and delivery(QCD) through continual improvement activities incooperation with suppliers and joint development.

• Technically skilled human resources(Human capital)• Accumulated technology and R&D centers(Intellectual capital)• R&D system with external cooperation(Social relationship capital)• Financial base to support R&D funding(Financial capital)(R&D)

Competitive advantage 1

Value Creation with “Tsunagu”
Technology

Research &Development

Strengths

Capital Inputs

Technological
Capabilities

Messages from Management■ Customer Value Creation Cycle

Fujikura Group Integrated Report 2021

46

Output

The “Tsunagu” Connecting Technologies
that Support Our Lives
The Fujikura Group uses the “tsunagu” (connecting) technologies it has developed through electrical wire and cablemanufacturing since its founding in 1885 to provide products for people’s lives and society in a wide variety of areas.
Our goal is to realize a “Mirai” (future) society that is comfortable and sustainable.

5G

Power Generation Plants
Fujikura is involved in ultra-high voltage transmission systems andmany other high capacity power distribution systems used to provide astable supply of electricity from remote areas and improve the reliabilityof line routes.

920 MHz band small-diameter
LCX (leaky coaxial cable)

Power cables

Optical fiber composite
overhead ground wires (OPGW)Electrical wires
and cables

ThermalHouseholds
Fujikura provides the optimal flexible printed circuits (FPC) tomake the latest smartphone and other devices smaller, lighter, andthinner, and total solutions combining a wide variety of electronic
components and modules.

Improving Quality of Life (QoL)

Wire components
in electronicequipment

OpticalWireless

FPC

Superconductors

Earphone cableconnectors

Business Opportunities

We achieve advancements in healthcare andhealth literacy by delivering many kinds ofsolutions for advanced healthcare, communities,
and occupations, and want to continue tocontribute to extending the healthy lifespan ofpeople and improve their quality of life.

Compact oxygen sensors
Conventional sensor on the left,
newly developed sensor on the right

60 GHz mmWave wirelesscommunications module

Sensors

Value Creation with “Tsunagu”
Technology

Coaxial cables

Platform consisting of seven“tsunagu” (connecting) technologies

Messages from Management

We are working to commercialize mmWave communication
devices for use in next-generation high-density high-speed
wireless communications in the 5G era.

Heat pipe fornotebook PCs

WABE Package®, a deviceembedded board built
into thin components

Offices and Data Centers
ESG Integration

We provide the optimal optical cabling system forthe customer’s needs with our extensive line-up of
the latest in optical fiber technology.

PlantsAutomotive

We provide many types of products for industrial equipment in plants, including fiber lasers
used in cutting metal, welding, and other types of processing.
Optical fiber mass fusion
splicers

SWR®/WTC®

47

Fujikura Group Integrated Report 2021

kW-grade highvoltage fiber laser

Connectors forindustrial robots

LILIA Live wire sheathfault locator

Partial discharge
measuring device

We are pursuing development of new products and new technologies
that integrate electronics technology and automotive products
technology to respond to trends such as CASE (Connectivity,
Autonomous, Sharing and Electrification), in addition to theconventional environmental, safety, and comfort needs.

Automotive products

Rapid charging connector

Seat belt reminder

We have focused on imaging and miniaturization, which are coretechnologies in the medical sector that derive from fiber optic andelectronic technology, and are working to expand the electronic
medical device business.

Fiberscope using
image fibers

IVUS* catheter* Intravascular ultrasoundCorporate Governance

Optical termination racks
and termination boxes

Hospitals

Electronic scopeusing CMOS

Fujikura Group Integrated Report 2021

48

Strategy and Business Performance

Progress on the 100-Day Plan
Fujikura is in an operational turnaround phase after the deterioration in performance in FY2019. Having set our basic strategy
as concentrating on a rapid operational recovery, we narrowed down the key measures to (1) “the unreserved selection andconcentration of existing businesses” and (2) “strengthening of Group governance” and formulated the 100-Day Plan. In FY2020, we
pursued business structural reform and other measures in accordance with this 100-Day Plan and succeeded recovering profit to acertain extent. However, we are still in the red at the net level. For this and other reasons, we are still only mid-course on the path tobusiness recovery and will persist in decisively implementing a wide range of measures based on the 100-Day Plan in FY2021.

To implement the 100-Day Plan to turn around operations swiftly and agilely, we implemented radical reform of the management
structure on April 1, 2021, before electing directors at the annual General Meeting of Shareholders.
The new positions of Chief Executive Officer (CEO) and Chief Operating Officer (COO) were established as part of the new structure
for pursuing business. The authority to forcefully pursue solutions to company-wide management issues and business structural reform
was concentrated in the Director, President & CEO, and the authority over business execution in the Company’s core businesses wasconcentrated in the Executive Officer & COO. The purpose of these reforms is to improve agility in pursuing business and speed inbusiness decisions. Fujikura introduced an in-house company system in April 2013. Under this system, a director in charge of business
operations in each in-house company was responsible for execution of business operations. However, the in-house company system
was constructively dissolved, a business unit system was introduced, and a vertically integrated organizational structure reporting
directly to the COO was created to facilitate agile, swift implementation of the 100-Day Plan to turn around operations. The internalorganizational structure was also simplified along with these reforms to clarify the responsibility and authority of executive officers whoreport directly to the COO for business execution, and the number of executive officers was reduced by half.
The revised organizational structure is shown below.

2020 Mid-term Business Plan

Operational Turnaround Phase

Sustained Growth Phase

Abandoned the 2020
Mid-term Business Plan andswitched to the operational
turnaround phase

Before revision

Director

Radical reform of
the management &business structure2020 Mid-term
Business Plan

Creating corporate
value throughsustained growth

Director
Corporate
Sales &
Marketing Unit

Corporate
R&D Unit

Director

Director

Director

Director

Director

Director

Power &
Telecommunication
Systems C

Electronics,
Automotive &Connector
Business C

Finance &Accounting
Div., etc.
Real EstateBusiness C

NorthAmericanoperations*

New
Businesses

Corporate
Staff Unit

(Corporate officers not currently serving as directors: 22)

Afterrevision

FY2019Director & COO■ Progress on the 100-Day Plan

[Core Businesses]• Telecommunication
Systems Business Unit
• Printed Circuit (PC)Business Unit
• Connector Business Unit
• Automotive Products
Business Unit
• Electronic Components
Business Unit

(As of May 2021)

The 100-Day Plan to turn around operations is generally progressing according to plan. The main initiatives are detailed below.

Structural Reform
Task Force

Director, President & CEO
Director

Director• North American
operations*• Industrial Electric
Wire Business• Real EstateBusiness Unit

Business Opportunities

FY2016

Director and President“C” is an abbreviation for Company

Value Creation with “Tsunagu”
Technology■ Management Structural Reform

Messages from Management■ Execution of the 100-Day Plan to Turn Around Operations• Corporate
Governance Unit
• Corporate Unit
• Corporate Quality
Management Unit
• Research andDevelopment Unit

(Corporate officers not concurrently serving as directors: 11)* North American telecommunication systems business centered on AFL Telecommunications LLC

Initiative TypeFPC business

Automotive wire harness business

Implementation of an early retirement incentive system (for around 200 people)

The changes in management structure are intended to further strengthen the supervisory function of the Board of Directors andcreated a structure in which outside directors comprise 50% of the Board of Directors.

Management structure reform
Personnel reductions, mainly at overseas locations
Impairment losses on manufacturing equipment
Consolidation and elimination of locations in the European region
Personnel reductions

Before revision

Board of Directors Composition(Total number: 15)

Director and President

Energy business

Exit from the overseas EPC business*

Telecommunication systems business

Pursuit of total solutions in optical cables
Rigorous selection of investments in growth businesses* EPC business: An abbreviation of Engineering, Procurement, and Construction. This refers to a business that provides integrated services including electrical wire andcable supply, construction installation design, and execution of construction.

Director & COO

Director (Sales & Marketing)Director (North American operations)

Director (Finance & Accounting Div., etc. and Real Estate Business C)

Internal

10

directors

Director (North American operations)Audit and Supervisory Committee member (Outside)

Audit and Supervisory Committee Member (Internal)

directors

Audit and Supervisory Committee member (Outside)

Audit and Supervisory Committee member (Outside)

Director (Corporate Staff)

Internal

5

Audit and Supervisory Committee member (Internal)

Audit and Supervisory Committee member (Outside)

Director (New businesses)

Outside5

directors

Audit and Supervisory Committee member (Outside)

Audit and Supervisory Committee Member (Outside)
Audit and Supervisory Committee Member (Outside)
Audit and Supervisory Committee Member (Outside)

Audit and Supervisory Committee Member (Outside)

Fujikura Group Integrated Report 2021

Director (Industrial Electric Wire and Real Estate Business)

Director (Power & Telecommunication Systems C)

Audit and Supervisory Committee Member (Outside)49

Director, President & CEO

Corporate GovernanceSelection and concentration of businesses

Board of Directors Composition(Total number: 10)

Director (R&D)

Director (Electronics, Automotive & Connector Business C)

Effective closure of overseas manufacturing locations

After revision

ESG Integration

Strengthening governance, etc.

Description

Outside5

directors

Strengthens the supervisory
function of the Boardof Directors

Fujikura Group Integrated Report 2021

50

Strategy and Business Performance
Progress on the 100-Day Plan

The goals in the FY2021 business plan are 600 billion yen in net sales (down 6.8% from FY2020), 20 billion yen in operating income(down 18.0% from FY2020), 16.5 billion yen in ordinary income (down 10.3% from FY2020), and 11.9 billion yen in profit attributableto owners of parent, an improvement of 6.5 billion yen. We have not yet determined the return to shareholders since we are still in
mid-course on the path to recovery.
As mentioned above, Fujikura previously had an in-house company system consisting of two in-house companies: The Power &Telecommunication Systems Company and the Electronics, Automotive & Connector Business Company. This was reorganized into
five core business units: The Telecommunication Systems Business Unit, PC Business Unit*, Connector Business Unit, Electronic
Components Business Unit, and Automotive Products Business Unit.
* The “Printed Circuit Business Unit” is a business unit that covers products that utilize circuit-formation products with printing technology, with a focus on printed circuits.

● Automotive Products Business Unit

Demand for telework increased in conjunction with the spreadof COVID-19 and demand has also emerged for next generation
infrastructure, such as 5G and IoT. We therefore expect active
investments to continue in the construction and enhancementof communications infrastructure networks, including FTTx anddata centers, with a focus on Europe and the U.S. in particular.
Our strategic SWR®/WTC® products are small diameter,
lightweight, and high density. They are easy to install so they
have been well received as the best solution for enhancing
communication infrastructure. Fujikura intends to concentrate
resources by further reinforcing production capacity and othermeans so that we do not miss out on these opportunities. We
will provide total solutions targeting enhancement of opticalinfrastructure networks with the addition of peripheral parts, etc.

The automotive industry will continue to face uncertainties
such as the continued spread of COVID-19 and semiconductor
shortages in FY2021 and beyond. Despite these uncertainties,
we are seeing a rebound in “earning power” in the automotive
wire harness business. We will aim to restore this entire business
unit to profitability by pursuing restructuring of locations in Asia
and reducing costs in Europe by further improving productivity
and achieving greater consistency in quality.

● PC Business Unit

● Connector Business Unit

● Electronic Components Business Unit
We will maintain high profitability and promote metabolismof change, including accessing new markets and attracting
new customers, by providing thermal and other solutions in
response to the increase in HDD capacity.
51

Fujikura Group Integrated Report 2021

*2 The term “infotainment” was coined by combining information withentertainment. It refers to products for navigation systems and audiovisual
devices mainly in the automotive field.
*3 The term “lighting” refers to automotive lighting such as headlights, direction
indicators, and cabin lights, etc.

● Structural Reforms Task Force
We collectively refer to the various initiatives under theoperational turnaround phase as the Structural Reforms Task
Force. Such initiatives include reforms to improve the businessstructure for better business stability and cost reductions
through the elimination and consolidation of locations. The
Structural Reforms Task Force is essential for accomplishingan operational turnaround. The activities of the task force
have therefore been specially designated as the mission of the
Director, President & CEO, and the various initiatives are being
executed under the leadership of the CEO.

■ Strengthening of Corporate GovernanceTo strengthen corporate governance, Fujikura 1) increased the percentage of outside directors to 50% and 2) established a
Corporate Governance Unit on April 1, 2021.

(1) Increase in the percentage of outside
directors(2) Establishment of the Corporate
Governance Unit

To strengthen the supervisory function of the Board of
Directors over the executive side, the internal directors whocomprised a majority of directors resigned as of March 31,
2021 and a Board of Directors structure of 10 directors in total(five outside directors and five internal directors) was adopted
from April 1, 2021. This increased the percentage of outside
directors on the Board of Directors from the previous onethird to 50%. The reduction in the number of internal directors
resulted in a change in composition from a Board of Directors
composed of many directors who represented the interests ofbusiness divisions to a Board of Directors composed of 50%
outside directors who are independent of the Company andpossess management experience and expertise in finance, law,and other areas. This more independent Board of Directors
will debate and make decisions on matters of importance tomanagement (formulation of medium and long-term strategy,
business portfolio restructuring, etc.).

To build a governance system that appropriately monitors
operational execution in the entire Group, we established the
Corporate Governance Unit to provide a cross-organization
function for exercising checks, monitoring, and supervisingeach business unit executing operations.

Corporate Governance

Optimization of the production structure through the businessstructural reforms we have implemented thus far have enabled
stable business operation. We intend to achieve sustained
growth by entering new markets areas in the future.

*1 The term “powertrain” refers to the overall drive transmission system, and it
also refers to the electronic components used in the system for facilitating
vehicle movements such as traveling forward, turning and stopping.

We will continue to narrow down R&D to key themes
where we can utilize our core businesses and technologies tocreate new businesses and development new products, whiletargeting new value creation and discerning market needs,
trends in demand, and other relevant information.

ESG Integration

The competitive environment continues to intensify as
smartphone demand peaks out. We anticipate a substantial
decline in sales in FY2021, due in part to a change in productmix. We will decisively implement business structural reforms
that extend to the elimination and consolidation of locations,strive to reduce costs further, and build a production structurethat adapts to changes in product mix. We will further refine
our existing efforts to improve quality and strengthen
technological capabilities, and will shift to businesses in areas
where we can maintain competitive superiority.

In terms of future initiatives in electronics related businessin general, we will work on the introduction of electronic
products in the automotive market. The automotive
market is undergoing a once in a century transformation intechnology including CASE (connected cars, autonomous
driving, sharing, and electrification) technologies. We havealready jointly developed technologies that support highspeed communication, power control systems, and othertechnologies. In the Connector Business Unit, we beganmass production of a connector for next generation vehicleto-vehicle communication from FY2021. In the Printed
Circuit Business Unit, we will also accelerate development of
products in the powertrain*1 area, in addition to our existing
infotainment*2 and lighting*3 areas.

We are always searching for ways to metabolize change inour businesses, products, and technologies, even during
the turnaround phase. Continuing R&D is essential for theCompany and we must do so to pursue initiatives targetingsustained growth in the future, after completing theturnaround phase. Therefore, we integrated the previously
established new business promotion function and R&D
function to establish the Research and Development Unit in
April 2021.
This integration was effected for the following three purposes:• To maintain the technologies that support existing
businesses at world-class level and develop innovative new
products• To integrate the entire process from considering new sites tobuilding a technology base and commercialization• To discern the vision of what Fujikura should be in the futurefrom a technological viewpoint and contribute to building a
growth strategy.

Business Opportunities● Telecommunication Systems Business Unit

● Research and Development Unit

Value Creation with “Tsunagu”
Technology

Core Business Units

Other Business Units, etc.

Messages from Management■ The Unreserved Selection and Concentration of Existing Businesses

Fujikura Group Integrated Report 2021

52

Strategy and Business Performance

Business Results by Unit
Net Sales (Billions of yen)
Net Sales

305.9billion yen

Fujikura will support the energy
and information infrastructure
underpinning society andconnect people, goods, and allmanner of things.

Operating Income (Billions of yen) /Operating Income (%)

371.7
371.7371.7
354.8
354.8354.8
327.8
327.8327.8
305.9305.9

22.4 22.4
305.9
6.0

Total Assets (Billions of yen)
269.5269.5
261.5 269.5
261.5261.5
248.4248.4
247.4
247.4247.4

22.4

17.7 17.7
6.0
6.0
5.0 5.0

18.1
17.7 18.1
5.9 5.9
5.0

248.4

18.1
5.9

4.5

1.4

1.4

Value Creation with “Tsunagu”
Technology

4.5 4.5
1.4

Messages from Management

Telecommunications Systems Business Unit2017 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal year)2017 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal2017year) 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal year)

Electronic Components Business Unit
Net Sales (Billions of yen)
Net Sales

199.9

billion yen

This segment pursues next
generation development throughglobal top-class technologies inmarkets that are changing rapidly.

Operating Income (Billions of yen) /Operating Income (%)

195.9 199.9199.9
195.9195.9
185.0
185.0185.0
175.1
175.1175.1

10.4 10.4

199.9

10.4

8.3 8.3
5.3

5.3
4.5

Total Assets (Billions of yen)

4.5

158.3158.3
158.3
150.0150.0
150.0147.8
147.8
147.8
131.3131.3

8.3
5.3

4.5
4.9 4.9

4.9

2.4 2.4

2.4

Business Opportunities–1.3 –1.3-2.2 -2.2

131.3

–1.3
-2.2

2017 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal year)2017 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal2017year) 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal year)

Automotive Products Business Unit
Net Sales (Billions of yen)
Net Sales

121.9

billion yen

157.0152.4
157.0157.0
154.1
154.1154.1
152.4

Operating Income (Billions of yen) /Operating Income (%)

Total Assets (Billions of yen)

152.4

110.2110.2

121.9121.9

110.2

96.1 96.1

121.9

96.1

72.2 72.2
72.2
66.2 66.2-2.0 -2.0-2.1 -2.1 -2.0
-2.1
-2.5 -2.5
-2.5
-3 -3

66.2

ESG Integration

Fujikura will work to develop andprovide new products and solutions
to the automotive industry,
which is undergoing its biggest
transformation in the last century.

-3-3.1 -3.1-3.2 -3.2-3.1-3.2-3.7 -3.7-3.7 -3.7-3.7-3.7(Fiscal2019
year)(Fiscal year)(Fiscal2019
year)(Fiscal year)
year) 2017
(Fiscal2019
year)(Fiscal year)2017 20172018 2018201920172019
2020
20182020
2020 (Fiscal year)2017 20172018 2018201920172019
2020
20182020
2020 (Fiscal2017
2018 2018201920172019
2020
20182020
2020 (Fiscal year)

Real Estate Business Unit
Net Salesbillion yen

Net Sales (Billions of yen)

Operating Income (Billions of yen) /Operating Income (%)

120
11.2 11.2
11.2 12010.9
10.9 10.9
10.8 10.810.9 10.9
10.810.9

120

60

60

60

0

0

0

Total Assets (Billions of yen)

5.5 5.5
5.5 5.3
5.3
5.2 5.2 5.3
5.0 5.0
5.0

5.2

50.2 50.2
50.2
46.1 46.147.7 47.747.7
46.1 47.747.7

47.7

500 500

43.3 42.042.7
43.3 43.3
42.7 42.7
42.0
42.0
39.7 39.7

500

Corporate Governance

10.9

We will strive to maintain andimprove asset value over the
medium and long term, and strive
to coexist and prosper together
with surrounding communities.

39.7

250 250

250

0

0

0

2017 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal year)2017 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal2017year) 20172018 2018201920172019
2020
20182020(Fiscal2019
year)(Fiscal year)
2020 (Fiscal year)

53

Fujikura Group Integrated Report 2021

Fujikura Group Integrated Report 2021

54

Strategy and Business Performance
Business Results by Unit

Telecommunications Systems Business Unit

Providing Solutions for Building Infrastructure Platforms● Optical cable● Optical fiber

Networks continue to evolve in a quest for faster, higher quality, and higher capacity connections.
The Fujikura Group continues to be the front runner with the No. 1 global share in the optical fiber
development and manufacturing technology that provides the backbone support for this goal.
We were also the first in the world to develop optical cable (SWR®/WTC®) that achieves high fiber
density in a slim cable. Plus, Fujikura is No. 1 in optical fiber fusion splicers, which connect opticalfibers with low loss, and provides total solutions for building optical networks.

● Optical installationequipment and components● Optical components● Optical fiber fusion splicer● Network equipment● Engineering■ Social Challenges Faced

2

Improving the efficiency
of cable-laying work fortelecommunications
infrastructure3

Curtailing the amountof energy used in
manufacturing products

Implementation Details

2

Carefully select growthbusinesses for investment

3

55

Fujikura Group Integrated Report 2021

(completely dry structure)

SZ Bunching Unit(for easy maneuverability)

Strength Member(long-distancetransmission)

Stripe Ring Mark(to easily
distinguish fibers)

Sheath(low friction)

AB-WTC™ Structure

New Core Alignment Fusion Splicer “90S+”
We have now begun sales of our new core alignment fusion splicer “90S+”. Up to now, we have striven to reduce
repeat work while splicing through remote wireless connectivity to the optical fiber cutter that makes mirror-finish
cuts through optical fibers. But this new product is equipped with the electrical discharge functions listed below,
which improve work efficiency by achieving stable, low-loss connections.
• Function for performing the optimal electric discharge depending on the condition of the cut face before splicing• Function for selecting the optimal electrical discharge based on automatic discernment of fiber type
• Function to control electrical discharge through real-time analysis of the thermoluminescent intensity of opticalfiber during electrical discharge

90S+

TOPIC
Reduce Fixed Costs• Sell off domestic engineering
company

Sales of Fusion Splice Racks for Ultra-High Count Multi-Core
Optical Fiber Cable Begin
Fujikura has begun sales of fusion splice rack for ultra-high count multi-core optical fiber
cable. While this product supports ultra-high count multi-core optical fiber cable, it has been
made as compact as possible by adjusting the size of the optical fiber reception tray, package
connection wiring, and housing. We were able to reduce work time by employing newly
designed protective tubing for the optical fiber and a removable optical fiber housing tray.
These make it possible for multiple workers to splice cores simultaneously. In addition toindoor splicing racks, we are earnestly developing outdoor and wall-mounted types.

Corporate Governance• Expanding investment in HSDC and FTTx suppliers is a big business
opportunity for our company• Continue to roll out FTTx, CATV, 5G, and HSDC in Europe and America• Concentrate management resources on optical network solution businessfocused on SWR®/WTC®
• Reduce environmental impacts with SWR®/WTC®, contributing to ESG
initiatives(long-distance transmission, thin,high density, and lightweight)

Reduce fixed costs

Initiatives for This Fiscal Year
Promote total solutions for optical cables as a growth businesswith pneumatic feed technology not only enables installation of longcable lengths, but contributes greatly to more economical cable route
construction through its ability to reduce the labor involved in opticalfiber splicing work.

ESG Integration

Promote total solutions for
optical cables

The proliferation of remote work has accelerated the installation of optical fiber cables, particularly in Europe and America. Among themethods used to install cable in Europe and America is the pneumatic cable feed method. The AB-WTC™ optical cable can be used with thismethod to reduce work time while simultaneously increasing capacity
Water Blocking Tape
200 μm Spider Web Ribbon®
through its high-density, multi-core structure. Combining SWR®*1/WTC®*2*1: SWR® (Spider Web Ribbon®) is a highly flexible ribbon applied to cables to create
slim high density cables.
*2: WTC® (Wrapping Tube Cable®) is the name for slim high density optical fiber
ribbon cable that uses SWR®.

	Implementation Details of Structural Reform and Initiatives forThis Fiscal Year

1

Air Blown Wrapping Tube Cable™ (AB-WTC™)

Business Opportunities

1

Maintaining atelecommunications
infrastructure that canhandle changes in lifestyles
following the pandemic■ Main Products

Value Creation with “Tsunagu”
Technology

Main Products

Messages from Management■ Unit Overview

Fusion Splicing Rack for
Ultra-High Count Multi-Core
Optical Fiber Cable: FDF-102

Fujikura Group Integrated Report 2021

56

Strategy and Business Performance
Business Results by Unit

Electronics Business Unit

■ Main Products
Demand is growing for long FPC, primarily for vehicle on-board applications and in the
medical field. The background for this is the use of FPC to save weight and reduce space forcable distribution, while also simplifying customer assembly. The circuit board processing
technology that we have cultivated over many years has made possible a flexibility incable distribution that is not limited by the size of the FPC. Alongside efforts to leverage
microtechnology to make products small, light, and thin, we are striving to further expand
the potential of FPCs to respond flexibly to society’s needs.

■ Unit Overview

Main Products● FPC● Electrical wire
● HDD components● Sensors● Thermal solutions● Membranes● Connectors

We Were Awarded the 2020 Scientific Contribution Award of the Heat Transfer
Society of Japan for Development of an Ultra-thin Heat Pipe and Vapor Chamber
Accelerating digitalization,and new lifestyles post-covid

3

Further improvements in
product quality throughuse of AI, and stronger
efforts toward DX

Implementation Details

1

2

Reduce stock on hand3

Declare impairment of
manufacturing equipment

This is one of four prizes awarded by the Heat Transfer Society of Japan, and is conferred on those who have developed
outstanding heat transfer technology.
This time, the award was given in recognition of achievements such as our patent applications, our contributions to thedevelopment of heat transfer technology through Heat Transfer Society publications, and the commercialization of a thincooling unit based on our company’s advanced technology.
Hereafter, we hope to contribute to the development ofheat transfer technology, and boost the performance of avarious devices. We will achieve this by further improving theheat transfer performance of our pipe and vapor chamber,
as well as developing and commercializing a compact heattransfer unit with good cooling efficiency.

ESG IntegrationI mplementation Details of Structural Reform and Initiatives forThis Fiscal Year
Optimize employee
placement both in Japanand abroadBusiness Opportunities

2

These connectors help to save space by being more compact than existing connectors of
the same type. Intended for connecting circuit boards together, these connectors featurelarge ground terminals on both sides. A 0.6 mm pitch, and two contact points ensure highly
reliable contact. The ground terminals make contact before the signal terminals fit together
to ensure adequate grounding. Connection through these ground terminals reduces noise,
and increases compactness and reliability.

TOPIC■ Social Challenges Faced1

Connectors to connect circuit boards infactory automation equipment

Value Creation with “Tsunagu”
Technology

The electronics business manufactures printed circuits, electrical wire, connectors, and otherelectronic components that create the delicate “neural network” of compact, highly-integrated
electronic products. The Fujikura Group demonstrates the quality and technological capabilities
cultivated in its global operations over many years in the total solutions it provides. Suchsolutions include the optimal FPC (flexible printed circuits) and broad variety of other electronic
components and modules for producing advanced devices such as smartphones and wearable
devices that are compact, lightweight, and thin.
We are also working to enter the automotive market with electronic products for “CASE”
and other aspects of the once-in-a-century transformation that the automotive industry isundergoing. We are already developing electric power control systems, support for high-speed
telecommunications, and more in collaboration with multiple customers.

Supporting increased
functionality and datatransmission speed indevices such as smartphones

Messages from Management

Long FPC* Heat Transfer Society of Japan: An academic society whose goals are to spread knowledge and advance scientific theory and technique related to heattransfer, and to foster exchange between members and the international community. (http://www.htsj.or.jp/en/)

TOPIC
Initiatives for This Fiscal Year

57

Fujikura Group Integrated Report 2021

Corporate Governance

Structural reform of our business
which tackles reorganization of locations

Pressure and Oxygen Sensors to Support the Medical Field
Our pressure sensors and oxygen sensors each maintain high sensing accuracy, and are employed by well-known medical
equipment manufacturers around the world. As COVID-19 has swept around the world demand has grown for medical equipment.
Our sensors are used as the active devices supporting important functions
in many of these devices, including sphygmomanometers, oxygen
concentrators, and ventilators. Fujikura supports everyone involved in
medical care by providing a stable supply of sensors manufactured to ahigh degree of reliability and with a proven track record.

Fujikura Group Integrated Report 2021

58

Strategy and Business Performance

Strategy and Business Performance

Business Results by Unit

Business Results by Unit

Automotive Business Unit

Real Estate Business Unit

Main Products● Electrical Components● Seat Sensors

1

Once-in-a-century
transformation of theautomotive industry

2

Maximizing Use of Assets and Maintaining Stable Revenue
We are effectively utilizing the former plant site next to Fujikura headquarters to expand our real estate business. Redevelopment
began in 1998, and we are operating a real estate leasing and management business, mainly for five office buildings and twocommercial buildings. The office buildings have a total leasable office space of around 107,000 m2. This property offers theadvantage of being located within 4 km of the Marunouchi district in central Tokyo, and has banks and many other excellent
tenants. It has continued to operate at full occupancy since FY2014.
The basic policy of Fujikura’s real estate business is to utilize long-held land effectively and increase revenues and profit. We plan
to increase tenant satisfaction through systematic investment and improvement to increase the value of currently owned buildings
and facilities, and maintain a high occupancy ratio for rental units over the medium and long term.

■ Social Challenges Faced
Shift to electrification of
automobiles

3

Development and provisionof new products andsolutions1

Development of communities that use lessenergy to realize a low-carbon society

2

Business Opportunities■ Social Challenges Faced■ Unit Overview

Value Creation with “Tsunagu”
Technology

In the automotive products business, we have 46 locations in 16 countries worldwide for the
manufacture, development, and sale of products in Asia, North and South America, and Europe.
And we continue to strengthen our production capabilities, including quality.
Our main products include automotive wire harnesses, in-vehicle LAN, and other total wiring
systems. These products support the evolution of mobility, which is accelerating globally.
The Fujikura Group is fusing electronics and vehicles to develop and provide new products
and solutions in the automotive industry as it undergoes a once-in-a-century transformation.
For our European business, we have been shrinking operations in Eastern Europe according
to plan. And, in FY2020, our sales ratio for Eastern Europe was at 35%.

● Wire Harnesses (WH)

Messages from Management■ Unit Overview

Development of communities capable ofsustaining business activities even during
a disaster and rapid response in restoring
residents’ livesI mplementation Details of Structural Reform and Initiatives forThis Fiscal Year
Keep operations profitable in North
Africa (Morocco), where earning
power is improving

Focus on the high-voltage
harnesses that accompany
automotive electrification

ESG Integration

Continue the downsizing of ourEastern European business which iscurrently underway

TOPIC
Renovation Work to Replace Poles in Safety Net at Fujigolf Center
In FY2020, the Real Estate Business Unit carried out renovation work
to replace the safety net poles. This was done to prevent damage fromthe increase in large-scale typhoons in recent years. It has significantly
improved safety. Moreover, the use of white nets has increased the
feeling of openness and drawn positive comments from customers.

Corporate Governance• Design strength is sufficient to withstand wind speeds in excess ofthe max wind-speed recorded at Edogawa the seaside: gusts of
43.8 m/s (Typhoon Hagibis, 2019).
New safety net poles updated to prevent wind damage

59

Fujikura Group Integrated Report 2021

Fujikura Group Integrated Report 2021

60

Fujikura Group Clean Tech
■ Reducing the Environmental Impact of Production and Transport
SWR®/WTC® also helps to reduce environmental impacts by making possible lighter cables with smaller diameters, reducing
production processes, and enabling the use of small-diameter drums.

Comparison
1,728 Core Loose Tube Type Optical Fiber Cables

What is Clean Tech?

1,728 core Wrapping Tube Cable® (WTC®)

Products, processes, or services which reduce the burden on the environment through significant improvements in energy
efficiency, sustainable use of resources, or environmental conservation activities.

Value Creation with “Tsunagu”
Technology■ Fujikura Group Optical Fiber Cables which Underpin 5G Society
Outer diameter: Φ31.5 mm
Weight: 749 kg/km

Outer diameter: Φ23.0 mm
Weight: 356 kg/km

EffectReduction in
the amount of plastic
in products

Reduction in
the amount of electricity
consumed throughmore efficient productmanufacturing

Reduction inwood used bysmaller diameter
wooden drums

CO2 reduction
from improved
transport efficiency

56

78

23

47

%

%

%

Business Opportunities

The demand for optical fiber cables has been growing worldwide as avariety of telecommunication services like 5G and IoT gain popularity.
Fujikura has commercialized its Spider Web Ribbon®/Wrapping Tube
Cable® (SWR®/WTC®), some of the world’s lightest and highest density
optical fiber cables. This technology allows optical fiber networks to bebuilt economically by effectively utilizing existing equipment. In FY2020,
we responded to growing global demand for data centers by developing
multi-core optical cable using slim optical fibers, and highly fire-resistant
optical cable for indoor installation that meets the CPR European
construction materials standard. In addition, we achieved practicalapplication of 3,000-core optical fiber cables suited to Japan’s domestic
telecommunication environment. It boasts the greatest number ofcores of any cable in Japan—1.5 times more than existing cables. Goingforward, we plan to develop a revolutionary optical fiber cables basedon SWR®/WTC® technology, and contribute to the development oftelecommunications networks in countries around the world.

Messages from Management

The Fujikura Group has thus far responded to the societal challenge of social infrastructure, and contributed tothe development of, not just Japan, but countries and regions throughout the world. We see thinking about how
to overcome the challenges facing the world through achieving the SDGs, as a great opportunity that will lead tosustainable growth for the Fujikura Group. And we are working to create shared value (CSV) by increasing social value
while obtaining economic value through our core business. This time, we would like to share those initiatives related to
Clean Tech, an area which has been gaining attention in recent years.

%

SWR®/WTC®

	Contributing to Decreased Total Cost of Ownership (TCO)
for Customers

SWR®/WTC® Product Features

ESG Integration

Our cable distribution solutions business, centered around SWR®/WTC®, also contributes to reduced TCO for customers.
Conventional telecommunications construction requires ducts and hand holes in order to support increased fiber capacity. So thecost of earthwork is a large percentage of expenses. However, the thin, lightweight nature of SWR®/WTC® means they can utilize
existing equipment. So there is no need for additional earthwork, and customer expenses are significantly decreased.

Illustration of Comparative Cost to Conventional
Telecommunications Construction*Without earthwork

Construction cost
Cable

Conventional Products

61

Fujikura Group Integrated Report 2021

SWR®/WTC®

Fujikura Group Integrated Report 2021

62

Corporate GovernanceThin,lightweight,
high-density

Effective utilization ofexisting equipment
eliminates the needfor additional earthwork,
helping to reduce costs

Fujikura Group Clean Tech

■ Concrete Example of Reduction in TCO
1 Ducts, hand holes

2 Benefits for handling

Increasing fiber capacity requires infrastructure that can contain

SWR®/WTC® cables can be installed by fewer workers

the new fibers. This has previously necessitated additional

because they are small and light.

construction. However, SWR®/WTC® makes it possible to avoid the

MOREcost of installing additional ducts by reusing existing ducts.

NO

LESS

YES

We have determined that we should focus our management resources on the optical network solution business centered around
SWR®/WTC®, and aimed at Europe and America. So, we have positioned this business as one of Fujikura’s core domains. We aim to
expand business by creating further differentiated products that can continue to make a good impression on many customers.

Main Markets
Data Center Market

SWR®/WTC® Net Sales by Region

3 Benefits in transport
SWR®/WTC® cables help to reduce the cost of transportbecause are small and light.

• Pursue development of a family of productsthat support next-generation data centerarchitectures
Other

FTTx
Utility pole

LESS

Since SWR®/WTC® can be made longer, fewer splices

MORE

U.S.

• Air-Blown WTC® (single package) has a good
reputation in Europe and America, wherecontracts are on the rise
• Going forward, we will continue to promotecustomization and expansion of types,
primarily in Europe and America

EuropeJapan
2018need to be made when installing the cables. This reduces

2019

2020

2021
(Forecast)

2025 (Fiscal year)(Future forecast)

the burden on workers.

Hand hole	Plant Relocation and Expansion, and New Production Lines
at Overseas Production Base■ Synergy with Peripheral Equipment

MPO Connector

Our UK group company, AFL Telecommunications Europe Ltd.,
has commenced operations at its relocated and expanded
its optical cable plant, after installing new production lines.
The new production lines manufacture Air Blown Wrapping
Tube Cable™ (AB-WTC™)*. This contributes to the construction
and development of FTTx and 5G networks in Europe and theUK. By starting local production, the Fujikura Group is able todeliver improved customer service to customers in Europe. It
also enables us to further elevate our ability to consistently
supply products by strengthening our supply chain. Beginning
local production also helps to vitalize the local economy andcreate new jobs.

Corporate Governance* Pneumatic cable feeding is a method for installing cable which uses compressed
air to blow optical cable through tubing. It is widely used in Europe and America.

ESG Integration

Cable distribution solutions centered around SWR®/WTC® help to meet client demands and reduce environmental impacts, thanks
not only to the cables themselves, but through synergy with peripheral equipment.

AFL Telecommunications Europe Plant

Traction Tube
3,456 Core WTC with
Multi-core Connectors

63

Fujikura Group Integrated Report 2021

Business Opportunities

4 Reduced burden on workers
during installation

Value Creation with “Tsunagu”
Technology

Japan
EuropeU.S.
OtherCore length• Expand business by supplying cabledistribution solutions
Ducts

Messages from Management

	Focus Management Resources on Optical Network
Solution Business

Ultra-High Count Optical Fiber
Fusion Splice Rack

Fujikura Group Integrated Report 2021

64

Response to Climate Change (TCFD)
Messages from Management■ Specifying Climate Change-related Risks and Opportunities
The Fujikura Group is working to specify the risks and opportunities that could materialize in the process of transitioning to a lowcarbon economy. We are analyzing what kind of impact climate change will have on growth of Fujikura Group businesses, basedon the long-term forecasts of international research institutions (OECD, IPCC), social concerns, and requests for response to climatechange from customers. The specified risks are reviewed as appropriate.

Risks
Type

Opportunities
Climate Change Risk

[Market Risk]• Changes in demand for products and services• Temporary increase in capital investment cost from climatechange countermeasures requested by customers or thecommunity• Rising raw material prices and diversification of suppliers
from climate change-related factors

Telecommunication
Systems[Reputation Risk]• Demands for information disclosure on and response to
climate change by customers, investors, and various ratingorganizations

Fujikura Group Integrated Report 2021

Electronics

Automotive
Products

Real Estate• Increase in demand for power, especially electric power
demand, mainly in developing countries due to economic
growth, urbanization, population growth, and otherfactors• Power supply stabilization, increased efficiency, andprogress on energy savings under the 2°C scenario
through the use of digital technology• Diversification of both power supply and demand forcompanies, individuals, etc., and increase in renewableenergy use under the 2°C scenario• Increased concern over natural disasters under the 4°C
scenario• Response to the Act on Promoting the Elimination of
Utility Poles (disasters, etc.)[Markets]
Proliferation and expansion of renewable energy[Products/Services]
Expansion of Green products[Energy Sources]
Products related to highly efficient electrical powersystems• Promotion of digital technology use[Resilience]Strengthening the resilience of social infrastructuresuch as electrical wire and cable• Exponential growth in data distribution, storage, andanalysis volume due to the advancement of digitalization• Rapid expansion in new service businesses that use digitaltechnologies such as big data, IoT, 5G, and AI• Advancement in CASE/MaaS• mmWave (wireless communication)• Concerns over response to natural disasters under a 4°C
scenario[Products/Services]
Roll out of solutions mainly for high density, smalldiameter optical cable (SWR®/WTC®)[Markets]
Expansion of Green products• Products for highly efficient IT systems• Promotion of digital technology use• Strengthening the resilience of communicationlines as social infrastructure• Increase in industrial robots• Entrance into medical products• Increase in automotive electronic components• Increase in mmWave-capable components• Pursuit of R&D to respond to CASE
• Promotion of digital technology use• Expansion of Green products• Increase in demand for industrial andautomotive connectors

CASE advances• Increase in wire harnesses accompanying increase inelectronic components• Advancement of move to electric vehicles under a 2°C
scenario• Increase in demand for lighter wire harnesses• Lighter wire harnesses• Pursuit of R&D to respond to CASE
• Combining knowledge of the automotive
products business with the telecommunication
systems, power, and other businesses to generate
new businesses related to electric vehicles• Strengthening response to automotive
components other than wire harnesses andelectric vehicles• Expansion of Green products

Promotion of digital technology use• Need to consider the positive environmental impact of
ZEB and other measures, etc.

• Securing and maintaining tenants that demandenvironmental friendlinessFujikura Group Integrated Report 2021

66

Corporate Governance65[Chronic Risk]• Health considerations for employees who work in the areaof operation due to a rise in the temperature, or otherchanges• Securing the safety of employees due to an increase in theamount of rainfall• Impact on operations from a future rise in sea level• Disaster preparedness/prevention response for
affected locations- We used the lessons learned from the damage
caused by the 2011 flooding at FETL in
Thailand and implemented measures such as
diversifying locations and building a flood wallnear the business, from the perspective of BCP• Slope face maintenance around office sites andresponse to high tides and tsunami at plants
near the ocean- Domestic locations that would be impacted byflooding and a rise in sea level
Head office, Fujikura Engineering Ltd.,FUJIKURA HIGH OPT Co., Ltd. (Kiba, Kotoku, Tokyo), Suzuki Giken Co., Ltd. (Tajiri,
Ichikawa-shi, Chiba Prefecture), Numazu
Copper Refining and Rolling Co., Ltd. (Kanaya
Izumi-Cho, Shimada-shi, Shizuoka Prefecture),
Nishi Nippon Electric Wire & Cable Co., Ltd.
(Kasugaura, Oita-shi, Oita Prefecture)* Survey of government hazard maps

Opportunities

ESG Integration

4°C Scenario(Physical risk)
Short Term/
Medium Term

[Acute Risk]• Impact on operations from flooding, a large typhoon, orother natural disaster- Impact on business results if a production facility isdamaged and this reduces operating capacity or requires
equipment restoration, etc.
- Impact on production plans due to partial severance ofthe supply chain→Fujikura Group companies suffered massive damage fromflooding in Thailand in 2011, and it took five years to recoverPower

Social Trends

Business Opportunities

2°C Scenario(Migration risk)
Short Term/
Medium Term

[Technology Risk]• Disruption of existing technology• Demand to minimize energy consumption during productmanufacturing or use renewable energy• Following the road map to 100% renewableenergy, move forward with extensive use ofenergy savings, introduction of renewableenergy, credits, and other tools based on
Fujikura Group Environmental Long-term Vision
2050• Pursuing use of renewable energy in businessactivities (at head office, plants, etc.)• Strengthening response by joining the RE100
and affirming TCFD, and regularly monitoring
and responding to ESG rating indicators

IndividualBusinesses

Value Creation with “Tsunagu”
Technology[Policy/Legal Risk]• Stricter CO2 emissions regulations in various countries
through the introduction of a carbon tax, etc.
- Trial calculation of financial impact from a carbon tax• Demands from customers and the countries Fujikura
operates in and obligation to reduce greenhouse gas
emissions and our carbon footprint

Future ResponseResponse to Climate Change (TCFD)

Pursuit of CSV
Solving social issues through business activities (CSV)
We are pursuing CSV as a strategy for contributing to the achievement of sustainable development goals (SDGs) alongwith profit growth for Fujikura. Creating Shared Value (CSV) is defined as increasing social value (solving social issues)and gaining economic value (profit) through a company’s main business activities. The Fujikura Group has always
engaged in business activities aimed at solving social issues in the past and we designated 2017 as the first year of CSV
in the Fujikura Group, the year in which we began seriously thinking about CSV.
Increase positive impact

Value Creation with “Tsunagu”
Technology

The Fujikura Group is developing environmentally friendly products (Green products) to contribute to the achievement of a lowcarbon society by reducing resource use, saving energy, and other measures.
The Green Product Management Committee
Green Products
screens Green products using the productenvironmental assessment check sheet submitted by
Green Products Awarded
the Green Project Logoeach business division, and registers products that
Products and services achieving significantly
meet or exceed the standards as Green Mind products.
higher environmental performance throughThe product environmental assessment check sheet
reductions in resource use and energy, etc.
was codified in 2011 and is updated regularly. The
Green Product Management Committee is chaired by
Green Mind Products
a member of the Corporate R&D Unit, and committee
Products and services assessed as achieving
members are selected from each business division.
higher environmental performance thanconventional products on the environmental
The goal for registering Green products is set at 60
impact assessment
products or more a year. In FY2020, there were 64 Greenproduct registrations, amounting to 37% of net sales.

Messages from Management■ Expansion of Environmentally Friendly Products

Target profit growth by instilling CSV internallyResearch&
Development

Materials

Manufacturing

CSV strategy
aimed at solvingsocial issues

Sales

Success incustomervalue creation

Minimize negative impact

Product Introduction 1

The use of retainerless connectors reduced weight by
10% and reduced the number of connector assembly
parts by 50% compared to conventional products. We
are contributing to energy conservation during productmanufacturing by making products lighter and easier towork with.

Business Opportunities

Wire harness using retainerless connectors

Using the SDG Compass
In the Fujikura Group, we are using the SDG Compass guide to pursue initiatives aimed at achieving the SDGs. We
promote internal awareness and understanding by following the activities in each step.
Step 1

Wire harness using retainerless connectors

Rare-earth High-temperature Superconducting (HTS) tape is characterized
by its superior critical current characteristics in high magnetic fields, and ismainly used in magnet applications. The application of high-temperature
superconductors holds promise for making superconductor magnets
smaller and lighter, and increasing current densities, thereby helping to
reduce negative environmental impact.

Step 2

Step 3

Step 4

Step 5

Defining priorities

Setting goals

Integrating

Reporting and communicating

ESG Integration

Product Introduction 2

Superconducting tape used in nuclear magnetic resonance (NMR)
spectrometer with high-field core

Understanding the SDGs

RepeatRaising awareness by communicating information

Corporate Governance

We are raising awareness of contributing to the achievement of SDGs internallyand externally by including the SDG logos corresponding to products in Fujikura
News, which is published on a regular basis. We are increasing the depth of mutually
cooperative relationships aimed at achieving SDGs by promoting understanding ofcontributions through Fujikura’s products.

High-temperature superconducting (HTS) tape

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68

Research & Development■ Approach to R&D

In March 2021, Fujikura and five other companies*1 conducted a joint driving assistance system demonstration test in Himeji“Tsunagu” (Connecting) Technologies Platform and Markets
Markets“Tsunagu” (Connecting) Technologies Platform

Sensors

Wireless

Optical• Optical devices• Optical fiber
fusion splicers
Optical• Optical
telecommunication components
systems• Optical
connectors• Optical cables• Optical fiber• Coaxial cables

Platform
technologies

Fiber lasers

Wire components
in electronicequipment• Electrical wire
• FPC
• Membrane switches• WABE• Connectors

Electrical wires
and cables• AI technology• Analytical technology

Thermal• Micro heat pipes• Cold plates• Material technology• Advanced equipment
technology• Automotive wire harnesses• Industrial wiring

Telecommunication
Systems

Industrial
equipment

Electronics

Medicalequipment

Automotive

Power• Observation & analysis
technology• Precision processing technology

mmWave Wireless Technology

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Fujikura Group Integrated Report 2021

Fixed-route bus driving assistance demonstration test

Membership in the Advanced Research Core (ARC) MIT.nano Consortium
MIT.nano is an organization established by the Massachusetts Institute of Technology (MIT) in the U.S. for advanced research in theareas of nanoscience and nanoengineering. The vast 200,000 ft2 research facility boasts dedicated lab space for inventing cuttingedge tools, machinery, processes and technology. And expert technical staff are on hand to provide support.
Fujikura’s Advanced Research Core (ARC), a new unit established in 2019 to handle advanced fundamental research, takes
the lead in cooperation with MIT.nano. As a member of the MIT community, we are accelerating the development of new coretechnologies in a new way.
Professor Vladimir Bulović, who created MIT.nano, had the following to say. “For more than a century, Fujikura has been in thebusiness of making connections.
This spirit is a perfect match forMIT’s culture of innovation throughcollaboration. We look forward toconnecting our new colleagues
from Fujikura to the MIT community
and the members of the MIT.nano
Consortium. ”

Group photo with MIT.nano’s first director, Prof. Vladimir Bulović

Fujikura Group Integrated Report 2021

70

Corporate Governance

The fifth generation (5G) telecommunications services that will underpin the telecommunications infrastructure from here out,
utilize extremely high frequencies known as “millimeter” waves (roughly 30 Ghz or more). And they are expected to bring about
the diffusion of high-speed, high-capacity wireless communication services. Compared to microwaves (a few GHz or less) whichhave been widely used thus far, mmWave wireless transmission is prone to attenuation and deterioration from a variety of factors.
Because of this, the materials, design, and manufacture of the various devices used in telecommunication equipment require
sophisticated techniques and a completely different approach than before.
Fujikura is pursuing research and development to improve the performance and reduce the cost of communications devices in
the mmWave band. We have developed a phased-array type mmWave wireless communications module in the 60 GHz band, which
integrates Phased Array Antenna with signal processing components. It achieves both world-class transmission speeds (greater than
2 Gbps) and long distance transmissions (greater than 500 m). We have also developed a high frequency (RF) IC, and FutureAccess,Phased Array Antenna Module equipped with an RF-IC, in the 28 GHz band. We hope these will be employed in 5G base stations.
And we are developing low-loss, high-performance devices, such as bandpass filters, in the mmWave band to provide total support
for next-generation mmWave communications devices.

60 GHz mmWave wirelesscommunications module

ESG Integration■ Research Areas

Prototypecommunication device*1 Kansai Transmission and Distribution, Inc., KYOCERA Corporation,
SHINKI BUS Co., Ltd., Panasonic System Networks R&D Lab. Co., Ltd.,
Magellan Systems Japan, Inc.
*2 Road-to-vehicle Communications: Bidirectional communication
carried out between vehicles and communications equipment
installed on the roadside to enable various types of support.
*3 GNSS correction data: Data containing corrections to compensate
for GNSS (Global Navigation Satellite System) satellite clock
errors and signal latency from passing through the ionosphere,
generated by terrestrial base stations and transmitted to devices
via wireless or the Internet to achieve centimeter-level positioning
accuracy.
*4 V2X: Vehicle to X. Two-way connection and data exchange
between a vehicle and another vehicle, person, or network.

Business Opportunities• mmWave modules• Energy-harvesting
sensor network
systems

Opticalsensing
applications

Superconductors• Pressure,oxygenCutting-edge Fundamental Research
Open Innovation

Value Creation with “Tsunagu”
Technology

Future-oriented R&D

Messages from Management

The Fujikura Group is using its “tsunagu” (connecting) technologies platform as the foundation for pursuing initiatives aimed atsolving societal challenges. We aim to develop our business by tackling societal challenges such as energy and environmental
problems. And we are actively promoting development of new products and technologies centered around the fields of energy,
telecommunications, electrical components, and connectors.

City, Hyogo Prefecture. The test made use of utility poles for road-to-vehicle communications*2, and achieved high-speed wirelesscommunications using a 60 GHz wireless communication module that we developed.
This demonstration test was the first of its kind in Japan to verify the effectiveness of a driving assistance system on a fixedroute bus in operation at intersections that lack signals and have poor visibility. We mounted a prototype communications device,equipped with a 60 GHz mmWave wireless communications module, to utility poles and fixed-route buses. Using the high-speed
road-to-vehicle wireless connection, we successfully transmitted real-time images from the bus-mounted camera, as well as the
GNSS correction data*3 needed for driving assistance.
The 60 GHz mmWave wireless communications module that we have developed achieves world-class transmission speed andrange. In addition to our traditional field of fixed-line communications, we hope it will be adopted for V2X*4 on a wide array ofvehicles (general and transport-related vehicles, construction and work vehicles, unmanned carriers in factories, etc.).

Research & Development

Superconductors

Telecommunications using optical fibers (development of which began in the 1970s) has become an essential element of our social
infrastructure. We expect the need for low-latency, high-capacity communications to become increasingly important as fifthgeneration telecommunication systems (5G) is rolled out. Multi-core optical fibers, which pack multiple cores into a single opticalfiber, are seen as a promising approach to meet the requirements for next-generation optical fibers. Our efforts toward practicalapplication are focused on development of four-core multi-core optical fibers (4c-MCF) with the same standard cladding diameteras 125 μm diameter general single-mode fibers. We have been successful in producing 4c-MCF with a step-index type refractive
index distribution that can reduce costs, as well as 4c-MCF with small trenches added to create a refractive index distribution withlow loss from bending. By developing these kinds of MCF mass production technologies, we are helping to build the high-capacity
telecommunications infrastructure of the future.

Contribution Towards a Low-Carbon Society

MarkerCore

MarkerWe are engaged in research and development, manufacture, and sales of rare-earth (RE) type high temperature superconducting
wire. This superconducting wire has excellent critical current characteristics at low temperatures and high magnetic fields. We
look forward to its use in a wide variety of industrial equipment such as superconducting magnets. In recent years, RE type hightemperature superconducting wire has begun to be considered for practical applications in electric aircraft, and is expected tocontribute to low carbon technology. At Fujikura, we will help to achieve a next-generation low carbon society through further
development of RE type high temperature superconducting wire.

Award from a Scientific Body with Global Influence
Yasuhiro Iijima, a fellow of our Superconductor Business Promotion Office, was awarded the Dr. James Wong Award by the IEEE,the world's largest scientific research organization and technical standardization body in the fields of electrical and computerengineering. The award was given for the discovery of film formation by the Ion-Beam-Assisted Deposition method (which isessential to implementation of RE type high temperature superconducting wire, and for his remarkable contributions to theindustrialization of high performance long length superconducting wire by effective application of IBAD and artificial pinningtechnology. We will continue to contribute to society by enhancing our world-class technological development capabilities.

Value Creation with “Tsunagu”
Technology

Core

Messages from Management

Multi-core Optical Fiber

Operating temperature

Current
limiters

Cladding

Trench4-core multi-core fiber with standard cladding diameter(Step-index type refractive index distribution)

4-core multi-core fiber with standard cladding diameter(Trench-added type refractive index distribution)

LN22Wind power

Areas in which
Bi type HTS
can be applied

LHe

Areas in which
metallic typecan be appliedPower storage
facilities
Ship motors

Siliconmonocrystal
pullers
MRI

Medicalaccelerators

Fusion(ITER)

External view of HTS tape produced by Fujikura
Nextgeneration
fusionreactors

NMR

Magnetic field strengthAward plaque from IEEE

Medical Products
We develop and manufacture functional components for medical devices to help people maintain their health and improve their
quality of life. This year we began mass production of ultrafine-diameter CMOS camera modules for use in disposable endoscopes
by a medical device manufacturer. And, we are helping to miniaturize a variety of solutions from implants to wearables, byleveraging the ultra-compact characteristics of our device-embedded circuit boards.

Acoustic information

AI

Anomaly notification

Generators

Sensors

AI boxUser interface

Equipment applications
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Fujikura Group Integrated Report 2021

AI acoustic sensor

Electronic scope using CMOS

Fiberscope using image fibers

IVUS* catheter* Intravascular ultrasound

WABE* Package®, a device-embedded board
built into thin components* WABE: Wafer And Board level device
Embedded package

Fujikura Group Integrated Report 2021

72

Corporate GovernanceTurbines

ESG Integration

We have developed acoustic sensors that use artificial intelligence (AI) to determine whether plant equipment is operating normallyor abnormally based on acoustic information. Using AI, these acoustic sensors can detect abnormalities in equipment early on, andsupport preventative maintenance by prompting repairs to equipment before these abnormalities lead to accidents or breakdowns
on plant production lines. They also respond to the current need to reduce reliance on remote monitoring and experienced inspectors.
A microphone or vibration sensor is employed for the sensing component, and the acoustic information detected is input to the
AI box following analog-to-digital conversion. The acoustic information includes, frequency, acoustic pressure, period, and pattern.
The AI analyzes these aspects to distinguish abnormal sounds. In addition, real-time displays of acoustic information, or notifications
about abnormalities, can be sent to a PC or mobile device at the customer’s request.
When a customer decides to use our acoustic sensors, we record sounds from the structure or air around the equipment to bemonitored. Then we incorporate this into the anomaly detection algorithm used by the AI box we provide to the customer.

Transformers
Industrial
motorsAI Acoustic Sensors

Business Opportunities

Cladding

Areas in which
RE type HTS can be applied

Superconducting
cablesHuman Resource Development

Workplace
Employee(selfdevelopment)

OJT

Motivation

Training
programs

Careerdevelopment
Personnel
systemOFF-JT

2) Elective training

1. Career Development
Assistance

Goals of Health Management

Health is a state of being fulfilled
physically, mentally, and socially. It
is not simply the absence of illness
or infirmity.

• Employees working in vigor• Company supporting employee
health• To improve the ability of
employees to maintain their health• To improve organizational
productivity• To enhance corporate value

Fujikura was recognized as a Certified Health & Productivity Management
Organization (large enterprise category) in 2021 for its initiatives in healthmanagement.

• Group training (group training for employees starting out their career,in their first or second year with the company)• Individual programs led by mentors (OJT)

A system is in place to work with supervisors to identify the necessary
knowledge and skills for each career stage and role through a
promotion system and evaluations, to create individual careerdevelopment plans, and to select from a wide range of training
programs suited to individual needs (outside group training, e-learning,correspondence education, etc.)

3) Next-generation
management career support(selective training)

Leadership training that develops leaders in individual fields andintensive management training to develop the executives of tomorrow4) Lifelong learning programs

Life planning seminars for employees who will retire in a few years

3. Operational specialist-related programs

Specialized training supervised by the relevant divisions(quality and manufacturing, intellectual property, legal affairs, labor,
accounting)Fujikura has established various rules on health to create a workplace in which employees can work in health and peace of mind
and to support diverse workstyles. We are implementing measures to prevent excessive work, establish an environment in which
employees can seek consultation on concerns, support return to the workplace, support medical care while working, and are
conducting various types of training, including training on self-care and care of team members.

	Collaborative Health with Health Insurance Associations and Fujikura
Social Health Research Institute Ltd. (Various kinds of training aimed
at improving health and preventing lifestyle-related diseases)

1

Regular and specified healthexams that exceed the legally
mandated exams (activities by
the health insurance association)2

Education and training
on improving healthconsciousness andknowledge (health literacy)

4

Measures to prevent passive
smoking

5Programs to establish
exercise habits

3

Establishment of various
consultation contacts

6

Introduction of the @Switch!
app (pronounced as “At
Switch”), a next-generation
health management solution

Fujikura Group Integrated Report 2021

74

Corporate Governance2. Compliance-related programs■ Strengthening Occupational Health
ESG Integration

Examples: Logical thinking, communication skills, problem solving, teamand organizational management, business administration, language,
and IT

Fujikura Group Integrated Report 2021

View on Health Management

Program Details

Various kinds of training on social responsibilities as a member of thebusiness community(related to fair trade, export control, labor relations, etc.)

73

Definition of HealthBusiness Opportunities

1) Career start-up assistance

The Fujikura Group’s Understanding of Health Management

	Recognized as a Certified Health & Productivity Management
Organization (Large enterprise category) in 2021

Human Resource Development Programs
Theme

The Fujikura Group believes that corporate competitive strength is based on good employee health. We recognize that the health of
our employees is an important management resource for continuing to be a company that is needed by society. Fujikura announced
the Fujikura Group Health Management Declaration in 2014. We actively support individuals in taking care of their own health andalso promote organizational activities for healthcare as part of our goal to be a corporate group that is appreciated by customers,
highly evaluated by society and whose employees work in vigor.

Value Creation with “Tsunagu”
Technology

Fostering a culturethat develops its human resources

The Fujikura Group thinks it is important to have talent that canoperate effectively globally in order to continually develop highly
innovative and useful products and solutions. Human resource
development activities targeted at this are therefore an important pillarof management that will pave the way for the Group’s future.
Human resource development involves a continual cycle thatconnects development and evaluation, focused mainly on on-the-job
training (OJT) in each workplace, based on the Fujikura Group HRM
Vision. The individual employee and his or her superior identify andshare the individual’s strengths and weaknesses, and expand on thestrengths while improving the weaknesses. This is a total system of
human resource development that links efforts to further growth.
A career challenge system has also been introduced. It was built
on internal open recruitment that makes it easy for an individual to
implement his or her own career plan. This fosters autonomy.

■ Employee Health is an Important Foundation of Management

Messages from Management■ Development of Human Resources to Support Global Business

Health Management

Respect for Human Rights
Specification of Foreseen Human Rights Risks

The Fujikura Group Policy on Human Rights clearly expresses the responsibility to respect basic human rights stipulated in the
Universal Declaration of Human Rights and elsewhere during the course of our business activities globally.
In addition, we strive to promote understanding and the actualization of human rights. As we establish policies and measureson human rights, we reference international norms such as the Guiding Principles on Business and Human Rights established by theUN, the OECD Guidelines for Multinational Enterprises, International Labor Standards, and the International Labour Organization’s
Declaration on Fundamental Principles and Rights at Work.

Foreseen Human Rights Risks

Main Policies on Business and Human Rights
Year Enacted

Name

Messages from Management■ Philosophy and Policy on Human Rights

The Fujikura Group uses international guidance on human rights, surveys from customers, and questionnaires from ESG rating
institutions to establish human rights risks that could materialize through business activities and carefully examine them on aregular basis.

Business Activity

Procurement

Manufacturing

Sales

Child labor, forced labor, abuse of
superior position, discrimination,
non-payment of wages, wrongfuldismissal, safety and health, etc.

Occupational health and safety,
labor-management relations,foreign workers, freedom of
association, harassment, etc.

Human rights violations due
to product safety and quality,
unintended use, etc.

Stakeholders

Suppliers
Local communities

Group employees

Customers
Local communities

Impact on
Business

Impact on stable procurement andrisk of customer losses

Reduction in engagement

Damage to brand value

Risk Assessment

Communication with suppliers
through Partners Meetings andconducting surveys

Use of the internal reporting
system, internal audits by aspecialized department, responses
to RBA audits from customers

Understanding trends in legislation
concerning human rights

Description

Criteria for the management of
employees’ health and safety and for
ethical considerations

Establishes rules on respect for human rights and building a work
environment that is easy to work in, and promotes building workplaces thatenable diverse human resources to work vigorously and contribute actively

2013

Fujikura Group CSR Activity Guidelines

Guidelines on response to The Ten Principles of the UN Global Compact

2015

Fujikura Group Harassment Prevention
PolicyPolicy expressing the responsibility to ensure a healthy workplace environment
free of harassment and raise awareness of harassment prevention

Sep. 2017

Group HRM Vision

Basic points and compass guiding human resource management aimed at
succeeding in global competition and prospering in the futureJan. 2017

Fujikura Group Policy on Human Rights

Clearly details the basic human rights specified in the Universal Declarationof Human Rights and other human rights principles that must be respected
when conducting business globally

Raising Internal Awareness of Business and Human Rights

2017

Fujikura Group Statement on theModern Slavery Act and Human
Trafficking (revised annually)

Response to UK Modern Slavery Act 2015

The Fujikura Group continually engages in awareness-raising activities to foster awareness of human rights and promote understandingof human rights issues through activities that instill the Fujikura Group Code of Conduct in all employees, including officers.

2020

Fujikura Group Code of Conduct(revised)Specifies a code of conduct that each employee should follow to avoid
damaging corporate value

Main Activities
Main Content

For all employees

Every year, Fujikura conducts a World Human Rights Day Campaign in conjunction with World Human Rights Day
on December 10
Provide e-learning courses on promoting understanding of and response to harassment

For officers

News concerning human rights and cases at other companies selected from the latest ESG topics is shared in
Sustainability Strategy Council meetings (four times a year)

For new employees

Basic training on sustainability is provided while promoting understanding of SDGs and engaging in discussion

For those in chargeof procurement

Facilitate understanding of the content of the CSR Procurement Guidelines and share basic information on
business and human rights* See P. 77 for the Fujikura Group Basic Procurement Policy■ Practicing Human Rights Due Diligence
Based on the Fujikura Group Policy on Human Rights, the FujikuraGroup takes steps internally to address human rights issues when
they emerge through the company’s internal reporting system andPartners Meetings with suppliers. The practice of human rights
due diligence is now required to protect human rights and ensuretransparency in procurement, manufacturing, and other businessactivities. In FY2020, we continued to build a human rights due
diligence framework based on the procedures outlined in the
Guiding Principles on Business and Human Rights.

Plan

Do

● Formulate together with the
new sustainability targets andthe relevant divisions● Specify envisioned human rights risks● Perform assessment using customer
survey responses, ESG rating
institution survey items, suppliersurveys, etc.

Dynamic
improvement
activitycycle● Revise rules and standards

Act

Check

Assistance

Dialogue/Consultation

Education/AwarenessInformation disclosure(handle complaints, correct)(stakeholder engagement)

Compliance with laws, regulations, and rules
concerning respect for human rights
Respect for human rights in all business activities

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Fujikura Group Integrated Report 2021

Consultation Hotlines for Employees EstablishedFujikura has established a harassment consultation desk, internal reporting system, internal reporting contacts at FujikuraGroup overseas locations, and a childcare consultation hotline. We have established a system for receiving reports and providing
consultations on human rights, discrimination, harassment, and many other issues of concern to employees in the workplace, in
addition to internal reporting, and strive to detect, resolve, and correct problems quickly. We have also established a system forreceiving anonymous consultation that enables people to consult directly with an external attorney.

Corporate Governance● Confirm current status andsort out issues● Exchange opinions withinvestors, experts, etc.

ESG Integration

Designed for

Future Initiatives• Promoting understanding of LGBT in the company• Formulating and implementing plans to promote business and human rights according to the national action plans (NAP)of different countries• Dialog and engagement with stakeholders concerning revision of human rights risks• Further cooperation with suppliers (conducting suppliers audits and training, establishing assistance measures, etc.)

Fujikura Group Integrated Report 2021

Business Opportunities

2007

Value Creation with “Tsunagu”
Technology

Human Rights
Risks

76

Health and Safety	Action Taken to Ensure Responsible Mineral Sourcing, Including
Conflict Minerals

	Fujikura Group Occupational Health and Safety Policy(Established on 1 April, 2021)

The Fujikura Group recognizes regional human rights violations, labor problems, and many other risks and illegal acts as serious
social issues related to mineral procurement in conflict-affected and high-risk areas/countries. We promote responsible mineralsourcing across our entire supply chain. We also participate in the Responsible Minerals Trade Working Group established by theJapan Electronics and Information Technology Industries Association (JEITA) and gather the latest information. An information
sharing meeting is held once a year for those in charge of the conflict minerals survey in each business unit to share and disseminate
the latest information in the Fujikura Group.

Initiatives in Responsible Mineral Sourcing Up to the Present
Main Initiatives

Aug. 2011

Fujikura Group Policy for Non-Use of Conflict Minerals formulated

Jun. 2016

CSR Procurement Guidelines formulated

Feb. 2017

Fujikura Group Statement on the Modern Slavery Act and Human Trafficking establishedMay 2019

Fujikura Group Policy for Responsible Mineral Sourcing formulatedAug. 2021

CSR Procurement Guidelines revised to the 5th version (to respond to the Responsible Business Alliance (RBA))

The promotion and penetration of CSR procurement requires direct dialogue with all suppliers. The Fujikura Group hosts the
Fujikura Group Partners Meeting in Tokyo, Shanghai, and Bangkok every year to obtain the understanding and cooperation of
suppliers and work toward CSR procurement across the entire supply chain.
Fujikura Group business plans, procurement policy, and other information are explained to participating suppliers at thePartners Meeting. We distribute the CSR Procurement Guidelines to help our suppliers understand the procurement activities of the
Fujikura Group and ask for their cooperation. In recent years, we have shared information on the importance of due diligence on
conflict minerals and other human rights issues in the supply chain as well as information on our response to climate change andother ESG themes.

In the Occupational Health and Safety Management System (OHSMS), proactive activities centered on risk assessment aredesignated as important activities for reducing occupational accidents. We implement activities to reduce the risks that have alreadybeen identified on an ongoing basis while also working to identify potential risks that have not yet been recognized. We aim tofoster a culture of safety under the shared theme of “reducing all risks to a tolerable level.”■ Health and Safety Patrols
Since we launched our OHSMS in FY2010, we have continued to confirm theprogress made by each of our plants, review the structure, and conduct site safety
patrols. This has improved the level of safety. The EHS Management Center has
visited the locations of Group companies in Japan since FY2016 and the locationsof Group companies overseas since FY2018. It conducts health and safety patrols
to instill our view on inherent safety and check on health and safety activities at
each location. In FY2020, remote health and safety patrols were conducted via
web conferencing because the COVID-19 pandemic made it difficult to travel andvisit sites.

Occurrence of Occupational Accidents at Fujikura in
FY2020 (Lost time accident rate)(Non-consolidated)
2018

2019

2020

Fujikura

0

0.34

0.37

Electrical wire and cablemanufacturing industry

0.87

0.23

0.92

Manufacturing industry

1.2

1.2

1.21

On a safety patrol

Corporate Governance

The Fujikura Group conducts regular supply chain management surveys of our main suppliers to ascertain the status of CSR
activities in the supply chain. We provide feedback on survey results to suppliers and share information with them. The survey
contains the following:• Dissemination of the Fujikura Group CSR Procurement Guidelines• Implementation status of CSR procurement at the supplier• Supplier evaluation• Action taken to ensure responsible mineral sourcing, including conflict minerals• Initiatives to prevent greenhouse gas emissions and inclusion of environmentally harmful substances• Response on human rights, including the UK Modern Slavery Act, etc.

■ Promoting Risk Assessment

ESG Integration■ Conducting Supply Chain Surveys

April 1, 2021
Fujikura Ltd.
Director, President & CEO

Source: Overview of labor accident trend survey (Ministry of Health, Labor and Welfare)77

Fujikura Group Integrated Report 2021

Business Opportunities■ Communication with All Suppliers

The Fujikura Group will implement the following:
1. We will comply with legal and other occupational health and safety requirements.
2. We will set specific targets related to occupational health and safety, implement measures and evaluate the results, andmake continuous improvements.
3. All divisions will conduct risk assessments and work to reduce risks.
4. We will promote maintaining and enhancing mental and physical health and support improving the working
environment and the health management of employees so that they can work actively.
5. We will provide the necessary resources to continuously improve our occupational health and safety management
systems through consultation with and participation by employees.

Value Creation with “Tsunagu”
Technology

EnactedMessages from Management

Responsible Mineral Sourcing

Fujikura Group Integrated Report 2021

78

Corporate GovernanceFaced with the rapid deterioration in business performance in FY2019, the Fujikura focused on a basic strategy of concentrating onan early business recovery from FY2020 and narrowed our focus to two key measures: 1) the unreserved selection and concentrationof existing businesses and 2) strengthening of corporate governance. We are resolutely implementing business structural reform,
management reorganization, and organizational restructuring based on the 100-Day Plan to turn around operations formulated in
September 2020. The top priority mission of management is to switch to the phase of creating corporate value through sustained
growth after achieving early completion of the operational turnaround. Fujikura’s basic views on corporate governance aimed at thesteady implementation of this mission are detailed below.

Fujikura switched to the organizational form of a company with an Audit & Supervisory Committee in 2017 to separate theWhen the Board of Directors makes decisions on the following matters concerning nomination of directors, the Nomination
Advisory Committee (composed of a majority of outside directors and chaired by an outside director) verifies the impartiality andappropriateness of the decision-making process, as an advisory body to the Board of Directors.
• Drafting General Meeting of Shareholders’ proposals on the election and dismissal of directors• Standards for election and dismissal of directors• Successor plans• Standards of independence for outside directors
When making decisions on the following matters concerning remuneration of directors, the Remuneration Advisory Committee(composed of a majority of outside directors and chaired by an outside director) verifies the impartiality and appropriateness of thedecision-making process, as an advisory body to the Board of Directors.

supervisory and executive functions. A majority of internal directors resigned as of March 31, 2021 and the Company adopted the• Discipline in determining director remuneration and amountstructure of a Board of Directors with 10 members in total, five of whom are outside directors (all Audit & Supervisory Committee• Amount of remuneration for individual directors

Members). This raised the percentage of outside directors on the Board of Directors to 50%, strengthening the supervisory functionof the Board of Directors over the business execution side. The outside directors who comprise a majority of the Board of Directors
are independent of Fujikura management, and are equipped with management experience and expertise in finance, legal affairs, andCorporate Governance Structureother areas. They engage in sufficient discussion of and make decisions on important business matters (formulation of the medium

General Meeting of Shareholders

and long-term strategies, revision of the business portfolio, etc.) together with internal directors at Board of Directors meetings.

Cooperation

Auditing/
Supervision

In Fujikura, a Chief Executive Officer (CEO) and Chief Operating Officer (COO) may be appointed from among the executive directors
by resolution of the Board of Directors, in principle. The CEO (hereafter, “Director, President & CEO”) serves as the chairman of theSupervision

Board of Directors and is the chief executive officer in charge of the corporate group consisting of Fujikura and its subsidiaries. As

Audit & Supervisory Committee(One full-time andfive independent members)

the person in charge of all business execution in Fujikura, the Director, President & CEO is also ultimately responsible for the pursuitof business in each business unit, structural reforms, and monitoring and supervision by the Corporate Unit. The COO is responsible

Assistancefull-time dedicated personnel.

Internal
Audit Division

Director,
President & CEO

Director & COO

Individual
directors

Core businesses

North American
operations
Industrial Cable
Business
Real EstateBusiness

Auditing
Supervision

Group Companies

Fujikura Group Integrated Report 2021

Management
Innovation Committee

Regulation

Risk Management
Committee

Internal Reporting
SystemSupervision

Research &Development

Support

Corporate
Staff

ReportingInternal Reporting
Contact
General Manager
of General
Affairs Division
External Reporting
Contact
External Law Office

Fujikura Group Integrated Report 2021

Corporate Governance

Quality
Control Unit

79

Remuneration
Advisory
Committee

Reporting

Structural Reforms Task Force

Auditing

Reporting

Reporting

Reporting
Cooperation

Corporate
Governance
Unit

Inquiry

Nomination
Advisory
Committee

ESG Integration

organization which assists the Audit & Supervisory Committee in its activities, at the direction of the committee. It is staffed withAccounting Auditors

directors who are independent of Fujikura management. An Audit & Supervisory Committee Office was established as the(10 members, six of whom are
Audit & Supervisory Committee Members)

Audit and Supervisory
Committee Officefor overseeing pursuit of the core businesses of the Fujikura Group.

The Audit & Supervisory Committee consists of six committee members in total, one full-time internal director and five outside

Board of Directors

Business Opportunities

Election

Executive Structure

Audit & Supervisory Committee(as of July 9, 2021)

Value Creation with “Tsunagu”
Technology

Board of Directors

Nomination and Remuneration of Directors

Messages from Management■ Basic View on Corporate Governance80Corporate Governance

Remuneration Categories
Categories
Composition

Number of Meetings Held

RiskManagement
Committee

The body that verifies Fujikura’s
operational execution structure and thestatus of execution from the perspectiveof risk (including compliance), preventsand evaluates losses, formulates a
response policy, and shares information,
among other activities

Chairperson: Masahiko Ito, Director,
President & CEO
Composed of executive directors andcorporate officers

23 times
Cooperates with the Corporate
Governance Promotion
Department established in
April 2020 on implementing
various activities to strengthen
the system of risk management

Nomination
Advisory
Committee

An advisory committee to the Board of
Directors established to ensure objectivity
and transparency in the decision-making
process concerning nomination ofcandidates for director positions

Four committee members
Chairperson: Yoshio Shirai, Director*
Members: Keiji Yoshikawa, Director*,
Yoji Yamaguchi, Director*, andMasahiko Ito, Director, President & CEO

Remuneration
Advisory
Committee

An advisory committee to the Boardof Directors established to ensure
objectivity and transparency in thedecision-making process concerning
remuneration of directors

Four committee members
Chairperson: Keiji Yoshikawa, Director*
Members: Yoshio Shirai, Director*,
Kozo Meguro, Director*, and MasahikoIto, Director, President & CEO

Management
Innovation
Committee

The body that works to improve theefficiency of management resources(including governance)(Management
Resource Efficiency Subcommittee),
improve efficiency through cost reduction(SAVE Committee), and improve
profitability by strengthening sales andpurchasing power (GAIN Committee)

Each executive director pursues
management items with MasahikoIto, Director, President & CEO as thegeneral chairperson

Basic compensation

Compensation for the monitoring and supervision functions of each director shall be a fixed amountaccording to his/her rank.

Short-term
performance-based
compensation

Compensation ranges from 0% to 200% of the basic compensation set by rank, according to corporate
performance and performance of the division the director is in charge of, and performance is based on
certain indicators (operating margin, ROE, etc.). These indicators are used because they easily reflect
management policy, strongly correspond to shareholder return, and are highly compatible with the Fujikura’s
growth strategy.
The indicator targets used as the basis of short-term performance-linked compensation for the current
fiscal year are the above noted indicators calculated from the consolidated plan for fiscal year ended March
31, 2020, decided by the Board of Directors at the end of March 2019. The degree of achievement is measured
by comparison with these same indicators calculated from consolidated performance during the same fiscal
year to determine the amount paid as short-term performance-linked compensation in the current fiscal year.

Stock-based
compensation

In addition to the monetary compensation mentioned above, Fujikura also grants common stock of Fujikura
Ltd. as compensation. This scheme is intended to enhance the motivation of directors to contribute to anincrease in the corporate value of Fujikura by placing directors in a position to enjoy the advantage of a rising
share price as well as to bear the risk of a falling share price, so that directors and shareholders share theadvantages and disadvantages of such fluctuations.

12 times

8 times

26 times

Details

Description of Remuneration Advisory Committee Activities
Date

Business Opportunities

Description

Details
Sorted out issues with the officer remuneration system* Outside director

Feb. 17, 2020

Set officer remuneration for FY2020 (Total annual base salary (ABS), short-term incentive (STI), andmanagement by objectives (MBO) allocation)■ Officer Remuneration

Jun. 23, 2020

Regarding FY2019 STI results and executive director remuneration in the 172nd period, regarding paymentof stock-based compensation to retired officers, regarding revision of the rules on officer remuneration, andregarding report to the Board of Directors

Aug. 4, 2020

Regarding confirmation of the FY2020 STI numerical plan and revisions to officer remuneration, report to theBoard of Directors, and confirmation of revisions to the rules on granting of stock

Sep. 14, 2020

Regarding explanation of the background, etc. for the resolution to reduce remuneration, and the report to
the Board of Directors

Fujikura Group Integrated Report 2021

Description of Board of Directors Activities
Date

DetailsJun. 26, 2020

Resolution on FY2020 officer remuneration and resolution on payment of stock-based compensation to
retired officers

Sep. 14, 2020

Resolution on reducing the amount of director remuneration

Fujikura Group Integrated Report 2021

Corporate Governance81

ESG Integration

Nov. 25, 2019

In addition to handling a large variety of products, Fujikura operates its business globally, and director duties are also highly
complex and varied. Our basic policy is that director remuneration should be at a level appropriate for outstanding humanresources who are capable of accomplishing such duties. We have therefore classified director remuneration into the following three
specific categories based on the survey results from multiple research groups, mainly on listed companies. We have established a
new system of remuneration based on objective indicators and evaluation, while also strengthening the link to performance.
The Board of Directors determines the policy on determining remuneration of directors who are not Audit & Supervisory
Committee Members and the remuneration amount after receiving the report of the Remuneration Advisory Committee, which
is an advisory body to the Board of Directors (consisting of the director in charge of human resources and three outside directors,
and chaired by an outside director). The Board of Directors judges the content of individual remuneration of directors who are
not Audit & Supervisory Committee Members for this fiscal year to be consistent with the policy on determination because theindividual director remuneration amounts were determined through the process stated in the policy on determination mentioned
above. To determine the remuneration, etc. of directors who are not Audit & Supervisory Committee Members, the Remuneration
Advisory Committee also evaluates the performance of each director, examines whether the level of compensation is in line withthe market, and confirms that the decision-making process concerning the remuneration structure and specific remuneration is fair
and appropriate. Based on the report from the Remuneration Advisory Committee, we have confirmed that the remuneration wasdetermined fairly and appropriately.
Variable compensation linked to performance and stock prices (short-term performance-linked compensation and stockbased compensation) is expected to be around 40%, at maximum. Remuneration of directors who are not executive directors shallconsist only of basic compensation in a fixed amount, according to the role of each director. No short-term performance-linked
compensation or stock-based compensation will be paid.

Value Creation with “Tsunagu”
Technology

Name

Messages from Management■ Committee Activities

82

Corporate GovernanceTotal Amount by Type of Compensation, etc. (Millions of yen)
Basic
Compensation

Performancelinked
Compensation

Stock-based
Compensation

Other

Numberof Officers
Remunerated

Directors (excluding Audit &Supervisory Committee
Members and outside
directors)

325

198

16

64

46

10

(excluding outside directors)

23

23

—

—

—

1

Outside officers

67

67

—

—

—

5

Officer Category

Total Amount of Consolidated Remuneration, etc. for Each Officer

Name

Joseph E. Gallagher

Total
Amount ofConsolidated
Remuneration,
etc.

170

Officer
Category

Director

Company
Category

Amount of Consolidated Remuneration, etc. by Type(Millions of yen)
Basic
Compensation

PerformanceStock-based
linkedCompensation
Compensation

Other	Measures to Ensure that Corporate Pension Funds Perform Their
Role as an Asset Owner
Fujikura has established a corporate pension fund (the Fujikura Corporate Pension Fund) to which it has entrusted the managementof Fujikura’s pension assets. Fujikura Corporate Pension Fund subcontracts the entire management of the assets to asset
management firms and monitors the management of those assets.
Fujikura takes care to provide the Fujikura Corporate Pension Fund with the necessary personnel and organizational structure toensure that the fund can monitor the asset management firms (handling practical management) effectively.

——

America Fujikura
Ltd.

■ Policy on Constructive Dialogue with Shareholders

42

97

—

23

(1) Fujikura promotes initiatives that enable the president and senior management to engage in constructive dialogue withshareholders and investors as a means to achieve sustained growth and increase corporate value over the medium to long term.
(2) Fujikura appoints a director in charge of investor relations to handle constructive dialogue and ensure the effectiveness of
dialogue and information disclosure. This director oversees the IR Group of the Business Strategy Planning Division, which
cooperates with related departments to conduct timely, fair, and appropriate disclosure of information.
(3) Other ways in which Fujikura discloses information include its periodic conferences for analysts and institutional investors held
four times a year (May, August, November, February), plant tours, and publications such as business reports and annual reports.
The president and the director in charge of investor relations (the Director, President & CEO has served concurrently as the director
in charge of investor relations from April 1, 2021) directly visit institutional investors in Europe, North America, and Asia to provide
an overview of Fujikura’s business operations, give briefings on earnings performance, and present an explanation of the Mid-term
Business Plan. In addition, dialog is enhanced through pertinent visits with investors, allowing opportunities to exchange opinions
on matters such as the agenda of the General Meeting of Shareholders, the corporate governance structure, and ESG.
(4) The Director, President & CEO and the director in charge of investor relations (currently serving concurrently as Director,
President & CEO) provide adequate feedback on the results of interviews with the aforementioned shareholders and investors to
directors and others.
(5) Fujikura has established a quiet period to prevent the leakage of financial information and ensure fairness. During this quiet
period, Fujikura does not comment on its financial information and does not respond to questions about this information.
Fujikura also works to prevent the leakage or spreading of important information, and prevent insider trading, under its rules oninternal information management.

A survey is conducted on the effectiveness of the Board of Directors and applies to all directors. The survey includes questions on
the adequacy of Board meetings overall (time, frequency, management of meeting proceedings, minutes, etc.), adequacy of agenda
items (timing, importance, volume of information, etc.), aspects of Board members (participation in discussions, etc.), and executive
office function. Fujikura considers the results of the survey and takes remedial measures as necessary.
Based on the items pointed out in the survey, Fujikura is taking the following specific steps: 1) improving various materials tofacilitate fuller discussion in Board of Directors meetings and providing various briefings to outside directors to enable them togain a deeper understanding, 2) strengthening the system to create ways for the business units to foresee risks and analyze them in
depth, and enable a swift response when risks materialize, in light of the losses incurred in business operations, and 3) revising thestandards for referral to the Board of Directors and other steps to reduce the number of proposals on routine business operations
and enable the Board of Directors to focus on medium and long-term strategy and other more important discussions.
The survey responses also suggested the need for more discussion of medium and long-term strategy and issues, and the future
vision for the Company.

Fujikura Group Integrated Report 2021

84

Corporate Governance—

ESG Integration

7■ Analysis and Evaluation of the Effectiveness of the Board of Directors

Fujikura Group Integrated Report 2021

Fujikura does not engage in cross-shareholding in principle. However, Fujikura may hold the shares of a company as a crossshareholding only if it is necessary for Fujikura to enter into a strategic business partnership in the course of its business activities
and this will contribute to an increase in corporate value of Fujikura over the medium to long term.
Fujikura sells off shares that it has decided to stop holding, and the Board of Directors receives reports on the sell-off of theseshares. At the same time, the Board of Directors treats the shares it has decided to continue holding as capital invested in eachbusiness unit and decides whether to continue holding them after examining their utility.

Submitting
company

Note: The total amount of consolidated remuneration is omitted for individuals receiving total consolidated remuneration, etc. of less than 100 million yen.

83

■ Policy on Cross-shareholding

Business Opportunities

Notes: 1. The amount of remuneration for directors who are not Audit & Supervisory Committee Members was set at a maximum of 600 million yen a year at the 169th
General Meeting of Shareholders held on June 29, 2017.
2. Introduction of a stock-based compensation system to grant common stock in Fujikura upon retirement as compensation to directors who are not Audit &Supervisory Committee Members was approved at the 169th General Meeting of Shareholders held on June 29, 2017. The amount of such compensation
approved for one fiscal year is a maximum of 120 million yen and a maximum of 285,000 shares.
3. The amount of remuneration for directors who are Audit & Supervisory Committee Members approved at the 169th General Meeting of Shareholders held on
June 29, 2017 is a maximum of 100 million yen a year (including compensation of outside directors of a maximum of 70 million yen a year).
4. Fujikura is currently implementing an operational turnaround plan in light of the deterioration in performance last fiscal year. This operational turnaround plan
includes management reform, and the number of directors who are not Audit & Supervisory Committee Members was reduced by one-half as of March 31,
2021. In doing so, the Company made the decision to pay one director who retired the amount noted above, as special additional director remuneration within
the amount of remuneration for directors who are not Audit & Supervisory Committee Members in Note 1 in order to dissolve the relationship with Fujikura
and the Fujikura Group in the future. Please note that this special additional remuneration is a special measure accompanying the implementation of the above
noted operational turnaround plan. The Board of Directors received a report from the Remuneration Advisory Committee stating that the specific content anddecision process was fair and appropriate when making the decision.

In Fujikura, when the Board of Directors nominates and dismisses directors who are not Audit & Supervisory Committee Members(excluding outside directors), it makes a decision after these matters have been deliberated by the Nomination Advisory Committee,
which is an advisory body to the Board of Directors (chaired by an outside director and consisting of the Director, President & CEO,the director in charge of human resources (who is concurrently serving as Director, President & CEO), and three outside directors).
The Nomination Advisory Committee deliberates on the standards for director nomination and the reasons for nominating eachcandidate, including their performance. The committee confirms that the decision-making process for the candidates proposed by
the Board of Directors is fair and appropriate, and reports the results of such deliberations to the Board of Directors. The Board of
Directors makes a decision on the proposal to elect directors for referral to the General Meeting of Shareholders based on this report.

Value Creation with “Tsunagu”
Technology

Total Amount of
Remuneration,
etc.
(Millions of yen)	Policy and Procedures for Appointment and Dismissal of Executive
Management and Nomination of Candidates for the Position of Directorand Audit & Supervisory Committee Member by the Board of Directors

Messages from Management

Total Amount of Consolidated Remuneration, etc. for Each Officer

Risk Management

Compliance■ Fujikura Group Code of Conduct

The Fujikura Group has established a policy to prevent or minimize losses in Group management and to maintain and enhance

A code of conduct governs conduct based on standards of conduct designed to enhance the value of the Fujikura Group and put

corporate value by building a foundation for sustainable, sound growth, through various risk management activities.

the Group Corporate Philosophy (MVCV) into practice. It is also necessary to ensure that conduct does not damage the corporate

Fujikura classifies risks to be managed into risks related to business opportunities (strategy risks) and risks related to theperformance of its business activities (operational risks). Strategy risks are managed by top executives jointly through the Boardof Directors and the Management Committee, while operational risks are managed by the Risk Management Committee basedvalue we have built up to now.
We therefore established the Fujikura Group Code of Conduct to specify the principles of conduct that every employee should
comply with and are implementing initiatives aimed at establishing firm corporate ethics in the entire Group.

on the Fujikura Risk Management Rules. For crisis management, we provide information to top management promptly and haveestablished a response organization and a management system in the Fujikura Risk Management Rules. Our risk management
structure is the same as our compliance structure.

■ Internal Reporting
protection, confidentiality, and prohibition of disadvantageous treatment of

Risk Management Structure● Initiatives in FY2020

Board of Directors

The Risk Management Committee met 23
times in FY2020. The committee regularly

Risk Management Committee

reports on the status of risk management

Chairperson: President

Audit &
Supervisory
Committee

Deputy Chairperson:
Officer responsible for general administration
Members:
Members of the Management Committee
Secretariat:
General Manager of General Affairs Department

Internal contact

and BCM*1 promotion from each division

External contact

and business unit. The Risk Management
Committee also convened extraordinary
meetings to respond to earthquakes andFujikura and its domestic and overseas Group companies*1 BCM is an abbreviation of Business Continuity Management. BCM refers to a management processduring normal times in preparation for unforeseen events. It includes training and education for
employees and implementing countermeasures in advance.

to fraud/compliance, harassment, violation of work rules, etc. In Japan, an
external contact has been set up by an external attorney in addition to the

FY2019FY202037

4741internal contact, to receive reports from Fujikura Group employees.
For Fujikura Group’s overseas locations, an external professional firm has been retained to establish an internal reporting
contact, in addition to the reporting contact established by each overseas subsidiary. The Fujikura head office receives these reports.

■ Anti-corruption Initiatives

and take action on accidents at Group

Understanding the need to prevent bribery and corruption in all countries

companies, and to investigate the impact on

and regions where the Group operates its business, the Fujikura Group

Fujikura from cases of impropriety in quality

revised its Fujikura Group Anti-Corruption Policy on June 1, 2020.

control at other companies.

The revision states that entertainment and gifts should be handledappropriately even when these do not constitute a legal violation. This

■ Ensuring Tax Transparency

FY2018policy also regulates compliance in the supply chain. We perform regular

Anti-corruption e-learning Course
Total No. of Course Participants

4,602

Total No. of Course Hours

6,903* An e-learning course (study/test) for officers and employees isheld once a year, at minimum.

Business Opportunities

other natural disasters, provide support

whistleblowers. The purpose of this system is to detect and respond quickly

Number of Internal Reports andConsultations

Value Creation with “Tsunagu”
Technology

The Fujikura Group operates an internal reporting system that stipulates

Messages from Management■ Risk Management Structure

audits of account ledgers and other documentation and provide e-learning
courses to ensure compliance with this policy.

With operations taking place globally, the Fujikura Group prepares to comply with tax rules by constantly gathering BEPS*2
information and concluding consulting agreements with licensed tax accountants. Following the BEPS project on international

Anti-corruption Initiatives in the Supply Chain
ESG Integration

taxation and pursuant to Japan’s revised tax system of FY2016, we have submitted our master file since FY2016, the initial fiscal year

The Fujikura Group includes provisions on anti-corruption and exclusion of anti-social forces in the basic business agreements it

for each applicable transaction since FY2017.

concludes with suppliers for the procurement of materials and components.

*2 BEPS stands for Base Erosion and Profit Shifting. It indicates actions by multinational corporations to shift profits to Group companies located in a country with a lower
tax rate to reduce tax burden.

advantageous position to prevent corruption, including among suppliers.

■ Cyber Security■ Privacy Protection

The Fujikura Group Electronic Information Security Committee is the lead on cyber security and held e-learning training on

On March 22, 2005, we established the Fujikura Privacy Policy. This policy stipulates the management system for personal information

information security for employees at locations in Japan and overseas. Fujikura also conducted a training exercise using a pseudo

protection and compliance matters. We have appointed an executive director as Chief of Personal Information Protection andemail as a way to combat targeted email attacks and make everyone aware of the correct response. At the same time, we informed

established a compliance and operating system for personal information protection by establishing company-wide personal

employees of how to respond to prevent damage through the company intranet as well, and made efforts to ensure thoroughinformation protection managers and department personal information protection managers in each department. We are currently

compliance. We also ran diagnostics to detect security weaknesses in devices that are connected to the Internet and took correctivein the process of revising our rules, including the specific response to the General Data Protection Regulation (GDPR) in the EU.

The Fujikura Group CSR Procurement Guidelines also include provisions prohibiting corruption and bribery and abuse of anaction on points where findings indicated weakness.
The CSIRT (Computer Security Incident Response Team) was launched and an emergency response established to minimize theimpact of cyber security incidents on our operations and customers. We intend to continue implementing such measures in the future.

85

Fujikura Group Integrated Report 2021

Fujikura Group Integrated Report 2021

86

Corporate Governanceof application, along with tax reports for each country where we operate, to the tax authorities. We have been preparing local files

Export Control

Instilling the Corporate Philosophy■ Publication of MVCV BOOK

Fujikura established the Basic Policy on Export Control in 2015. This policy makes it clear that the entire Group engages in security

Fujikura reviewed and revised the Fujikura Group Corporate Philosophy (MVCV) to respondto changes in the business environment. We compiled MVCV BOOK as a tool that will enable
everyone to understand the significance of Fujikura and our cherished Corporate Philosophy(MVCV). MVCV BOOK specifies the new Standards of Conduct that all employees should be
mindful of in their day-to-day work to enhance corporate value and a new Code of Conduct that
all employees should comply with in their day-to-day work to avoid damage to corporate value.
Based on this Fujikura Group Corporate Philosophy (MVCV), we will quickly identify changes
in society and solve social issues through our businesses to contribute to the creation of an evenbetter society in which people lives full of vitality and abundance.

export control as part of the international community.

Fujikura Group Basic Policy on Export Control (Established in October 2015)

MVCV BOOK, a tool for putting
the Fujikura Group Corporate
Philosophy (MVCV) into practice■ Activities to Instill MVCV■ Internal Activities to Raise AwarenessType

We conduct activities to raise awareness and enable all employees to practice the Fujikura Group Corporate Philosophy (MVCV)
naturally in their conduct.

Description

The COVID-19 pandemic resulted in the postponement of many activities to instill MVCV in FY2020. MVCV activities that were

For export control to function properly, it is important for all employees to be knowledgeable about
export controls. Fujikura is concentrating on providing e-learning to all employees. A mandatorye-learning course providing basic knowledge of export controls was established for employees involvedin export control in domestic Group companies in FY2020. A number of voluntary e-learning and open
courses on different topics (basic knowledge, determining applicability*, transaction screening) werealso established (in FY2020, all courses were e-learning courses to prevent the spread of COVID-19).
4,405 people in total have taken these e-learning courses.

2. Internal audits

We conduct a combination of written and onsite audits of all head office divisions. (Audits are being
through Web conferences to prevent the spread of COVID-19.) Individual guidance is provided on audit
findings, and this guidance is linked to improvement activities.

3. Streamlining of export
control operations

We aim to streamline operations by systemizing export control with the help of IT. Operations include
transaction screening, determination of regulated goods and screening of problem customers.

each person think about and state their own standards of conduct based on the new Standards of Conduct, and other means. Throughthese activities we were able to gain a fresh recognition of the values and views (insights, shared values) cherished by Fujikura.
We plan to conduct seminars for all Fujikura Group employees again this fiscal year to give them a deeper understanding of the
Fujikura Group Corporate Philosophy (MVCV) (MVCV interpretation) and to enhance the Fujikura’s corporate value (brand).

FY2020 Plans and Activity Results and FY2021 Plans for Instilling MVCVKey Activity Themes

Firmly Instilling FujikuraGroup Corporate
Philosophy (MVCV)

4. Education and training forGroup companies

FY2020Plan

FY2021
Activity Results

Plan

1. Develop the trainers• Postponed to next fiscal year orlater due to COVID-19

1. Develop the trainers

2. MVCV training by grade level• New employees and second year
training: 117 participants

2. MVCV training by grade level

3. 	MVCV educational activities inwhich all employees participate• 406 workplaces reported
activities during October, themonth for reinforcing MVCV

3. MVCV educational activities inwhich all employees participate

4. Preparation for roll-out tooverseas groups• Postponed to next fiscal year orlater due to COVID-19

4. Preparation for roll-out tooverseas groups

5. Communicating and sharing
information• Continued to host an MVCV
website for overseas

5. Communicating and sharing
information

5. Professional certificationfor export control
employees

Corporate GovernanceStudy sessions were held through Web
conferences that connected telecommuting
employees with workplace meeting rooms via
the Internet.

Employees working in export control at Fujikura who wish to become professionals can obtaincertification. Employees who have obtained national certification as an STC Expert by the Center for
Information on Security Trade Control (CISTEC) or as a Registered Customs Specialist by the Ministry of
Finance are responding to many requests for consultation internally.

* Determining applicability refers to determining whether the goods you want to export or the technology you want to provide (including programs) is a control-listed item.
MVCV training by grade level conducted through Zoom

87

Fujikura Group Integrated Report 2021

ESG Integration

Although we were unable to travel to Group companies toprovide education and training in FY2020 due to efforts toprevent the spread of COVID-19, we conducted e-learning
courses for domestic Group companies and a total of 683
people participated.

possible in a telecommuting environment were conducted by providing seminars by grade-level through Web conferences, having

Business Opportunities

1. Internal training

Fujikura has established October of each year as the month in which we reinforce our Mission, Vision, and Core Values (MVCV).

Value Creation with “Tsunagu”
Technology• It is the basic policy of the Fujikura Group to refrain from participating in transactions that could disrupt the maintenance ofinternational peace and security.
• We comply with the laws and regulations on export control in the countries and regions where we operate our business.
• We establish an export control system and rules to ensure compliance with the basic policy and laws and regulations
noted above.

Messages from Management■ Fujikura Group Basic Policy on Export Control

Fujikura Group Integrated Report 2021

88Special Initiatives of the Fujikura Group

Supporting Fujikura Gakuen■ Main Supporting Activities

Messages from Management

Our support of Fujikura Gakuen forms part of the Fujikura Group’s social contribution activities. The goal is to support
its users, namely children with cognitive disabilities, in developing physically and mentally in a wholesome mannerand gaining essential skills for living independently in the local community while preserving their dignity.

Support is provided through fundraising donations, volunteer activities, and product sales, which also contribute to fostering theright mindset (thinking, action, and belief ) for each individual employee.

Group company
donations

Distributing Fuji Café products
at the General Meeting of Shareholders

Fujikura Sakura Works
conducts fundraising
activities in support of
Fujikura Gakuen. In FY2020,
due to the pandemic, wewere not able to deliver thecollected funds directly tothe business office, but it
will continue its support
activities in the future.

Many Fujikura Group
companies, including
Fujikura Ltd., makedonations. The entire
Fujikura Group considers
the support provided to
Fujikura Gakuen to be thefocal point of our social
contribution activities,
and this support will besustained going forward.

We distribute cookies made at Fuji Café, which is operated by Fujikura
Gakuen in Izu Oshima, to those who come to the General Meetingof Shareholders to help our shareholders understand our efforts insupport activities.

Value Creation with “Tsunagu”
Technology

Presenting Donations
from the Works

Distribution to General Meetingof Shareholders attendees■ What is Fujikura Gakuen?
Supporters Club
(wage deductions)

Distributing
Fuji Café products at
the General Meetingof Shareholders

Fujikura Gakuen Circle of Support
On-site sale ofFuji Café products

Works donations

Employeedonation drive

Vending machines
donations

Fujikura Group Integrated Report 2021

Facilities

2

locations

Izu Oshima, Tama (Hachioji City)

Volunteer activities of new employees

On-site sale of Fuji Café products

Each year, newly hired employees participate involunteer activities at Tama Fujikura Gakuen as partof their new hire training. These activities enable new
employees to foster bonds with their colleagues,
appreciate the mission of the Group’s founders, andrecognize the importance of supporting Fujikura Gakuen.

Located in Izu Oshima, Fuji Café is a living assistance center where students ofFujikura Gakuen undergo vocational training to gain independence. The Fuji Café
exhibition and sale, which features products made by Fuji Café (pound cakes,
cookies, etc.), has been hosted at the Fujikura head office and Nishi Nippon
Electric Wire & Cable with ongoing support.

Corporate Governance89

Fuji Café, operated by Fujikura Gakuen

Seconding officers

Participationin events(founding festival,
Christmas)

ESG Integration

Fujikura Gakuen in Izu Oshima

1919

Purchase of
Fuji Café products
within the Group

Group company
donations

Volunteering by
new employees

Established

Corporate
donations

Business Opportunities

Harukichi Nakauchi,
founder of Fujikura Gakuen

Fujikura Gakuen, a social welfare corporation, was founded on June 7, 1919 in the town ofMotomachi on Izu Oshima. Harukichi Nakauchi, the blood brother of the founder Zenpachi
Fujikura, donated a sizable amount of his personal assets (currently worth approximately 2 billion
yen) and 40,000 tsubo of land (approx. 132,000 m2) on Izu Oshima for the land and building toestablish the school and residence for mentally handicapped children and adults. Today, Fujikura
Gakuen has facilities on Izu Oshima and in Tama (Hachioji City). These facilities have around 100
workers who provide 24-hour care and education to approximately 130 individuals.
Since its inception, the Fujikura Group has made donations as a company and its individual
employees have donated their own money, too, in supporting the organization to continue its
operations. The support provided to Fujikura Gakuen is considered the focal point of the FujikuraGroup’s social contribution activities, and this support will be sustained going forward.

No. of clients

Approx.

130

On-site sale at head office
Painting (FY2019)

On-site sale at Nishi Nippon
Electric Wire & Cable

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Special Initiatives of the Fujikura Group

Fujikura

PlantsFish● 80 species native to the Kantoarea; 500 tall and medium-sizedtrees, 2,000 shrubs● 65 grass, moss, and aquaticplant species; approx. 15,000
plants

Birds● Limited to fish, shrimp, andshellfish in the Arakawa
watershed● Approximately 800 fish of
10 different species werereleased; there are now around
1,300 fish

● Around 20 species, including

the common kingfisher,brown-eared bulbul, andspotbilled duckInsects● Over 50 species of dragonflies,

butterflies, and other insects
spottedAt Fujikura Kiba Millennium Woods, we place importance on active
communication with employees and members of the community. The
woods are mainly used for educational activities to raise environmental
awareness among employees, nature education for local preschools,
kindergartens, and elementary schools, as well as for graduate schoolclasses and government-sponsored ecological tours.

Bird’s Eye View
Walking path around the water’s edge
(Koto-ku)

Features
Lower
pond

2010
Area: 2,200 m
Built in2

Open path ujikura’s Resolve to Protect
F
Biodiversity

	Fujikura Kiba Millennium Woods

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Fujikura Group Integrated Report 2021

We became the first recipient of
the Award of Excellence (large
company division) in the 2020
Environmental Human Resource
Development Company Awards
sponsored by The Ministryof the Environment and theEnvironmental Consortium
for Leadership Development
Certificate of Commendation(EcoLeaD). This award was given
in recognition of the aforementioned kinds of environmentally-friendly
production activities, efforts toward employee education, and othercomprehensive initiatives, and activities to promote biodiversity incooperation with the local area and government, as represented by
the Fujikura Kiba Millennium Woods. The 2020 Environmental Human
Resource Development Company Awards recognizes companies
which support activities to nurture and produce personnel to leadenvironmentally-friendly company activities. It is based on the Act
on the Promotion of Environmental Conservation Activities throughEnvironmental Education.

Certified as Edo-Midori Green Area Registration(Excellent Green Area)
In 2017, Fujikura Kiba Millennium Woods was registered as a goodgreen area under the Edo-Midori Green Area Registration. This system
restores the environment suitable for the creatures of Tokyo, including
wildlife such as insects and birds, by planting vegetation (native species)
naturally distributed in Tokyo on the premises of buildings, etc. Fujikura
was registered because of its participationin the Edo Green Restoration Program,a project to plant native species being
implemented by the Tokyo Metropolitan
Government as a public-private
partnership, where relevant industries
join together to formulate measures for
spreading native species in Tokyo.

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92

Corporate Governance

When we redeveloped the grounds of our head office in November
2010, we opened a biotope and garden called Fujikura Kiba
Millennium Woods next to our head office in response to requests
from local schools and citizens for more greenery and the increasing
interest in biodiversity.
The name, Fujikura Kiba Millennium Woods, incorporates thehope shared with everyone in the Kiba area of Koto-ku that theabundance of nature will persist in the future for 1,000 years.
Fujikura Kiba Millennium Woods covers 2,200 m2 and contains two
ponds and a river that connects them, a floating island, walking paths,
and other features. We gave preference to native species in designingit to replicate the abundant forests and woods that existed in theMusashino plateau several hundred years ago, as a space dedicatedto wildlife. The woods have now grown enough for the chicks of the
spotbilled duck and the common kingfisher to fly out of their nests.

(Recognizes corporations promoting development ofenvironmental human resources)

ESG Integration

Created as a Symbol of the Local
Community ujikura Given the Award of ExcellenceFin the 2020 Environmental Human
Resource Development Company Awards
from the Ministry of the Environment

Business Opportunities

The Fujikura Group is keenly aware of the close relationshipbetween its business activities and the global environment, andhas set the goal of being a corporate group that is good for bothpeople and the environment and strives to make every effort toprotect the global environment. All living things live by mutually
supporting one another either directly or indirectly, and our lives
and lifestyles are supported by the many blessings generated
through biodiversity. The Fujikura Group formulated “Roadmap
2030: A Long-Term Vision for Biodiversity” in January 2013 and ispursuing initiatives aimed at increasing every employee’s awarenessof protecting biodiversity.

Limited tonative species

Use for graduate school classes

Value Creation with “Tsunagu”
Technology

Upper
pond

Use for nature education activities for
local children

Messages from Management

Kiba Millennium Woods■ Communication with Local Residents

Wildlife and Plants inFujikura Kiba Millennium Woods

Corporate Profile■ Stock Information (as of March 31, 2021)

Company name: Fujikura Ltd.

Capital:Founded:February 1885

Headquarters: 1-5-1, Kiba, Koto-ku, Tokyo 135-8512

Established:

March 1910

53 billion yen (as of March 31, 2021)

1. Authorized shares:

1,190,000,000

2. Issued Shares:

295,863,421 (including 19,455,441 treasury shares)

3. Major Shareholders
Shareholding
Composition (%)

The Master Trust Bank of Japan, Ltd. (Trust Account)

31,750

11.49

Custody Bank of Japan, Ltd. (Trust account)

19,492

7.05

ThailandTAIJU LIFE INSURANCE COMPANY LIMITED

10,192

3.69

FUJIKURA HIGH OPT Co., Ltd.

Fujikura Electronics (Thailand) Ltd.

Sumitomo Mitsui Banking Corporation

8,456

3.06

Fujikura Components Ltd.

DDK (Thailand) Ltd.

6,777

2.45

Fujikura Solutions Ltd.

Fujikura Automotive (Thailand) Ltd.

Custody Bank of Japan, Ltd.
(Sumitomo Mitsui Trust Bank, Limited Retirement Benefit Trust Account)
Dowa Metals & Mining Co., Ltd.

6,564

2.37

The Shizuoka Bank, Ltd.

5,789

2.09

Japan

DDK Ltd.
East, South, and Southeast Asia

Nishi Nippon Electric Wire & Cable Co., Ltd.

Fujikura Asia Ltd.

Numazu Copper Refining and Rolling Co., Ltd.

Fujikura Federal Cables Sdn. Bhd.

Fujikura Shoji Co., Ltd.

PT Fujikura Indonesia

Fujikura Precision Ltd.

Fujikura Electronics Vietnam Ltd.

Fujikura Automotive Asia Ltd.

Fujikura Fiber Optics Vietnam Ltd.

Suzuki Giken Co., Ltd.

DDK VIETNAM Ltd.

Fujikura Engineering Ltd.

Fujikura Automotive Vietnam Ltd.

Precision Fiber Optics Ltd.

Fujikura Automotive India Private Ltd.

Shinshiro Cable, Ltd.

Fujikura Korea Automotive Ltd.

Fujikura Employees Shareholding Association

4,844

1.75

Custody Bank of Japan, Ltd. (Trust account 5)

3,656

1.32

JP MORGAN CHASE BANK 385781 (Authorized agent: Mizuho Bank, Ltd.)

3,415

1.24

(Notes)1. The numbers presented in “Number of shares held” are based on the list of shareholders.
2. The Company owns 19,455,000 treasury shares in addition to those noted above. Treasury shares do not include the 900,000 shares held by the trust account relating
to the stock distribution trust established for the stock-based compensation plan for directors (excluding outside directors) and executive officers.

■ External Evaluation
FTSE4Good Global Index (from June 2016)

Aomori Fujikura Kanaya Ltd.
EMEA (Europe, Middle East, and Africa)

Fuji Materials Ltd.

Fujikura Europe Ltd.

Fujikura Dia Cable Ltd.

Fujikura Automotive Europe S.A.U.

Yonezawa Electric Wire Co., Ltd.

Fujikura Automotive Europe GmbHFiberTech Co., Ltd.

Fujikura Automotive Romania S.R.L.

Optoenergy, Inc.

Fujikura Automotive Morocco Tangier, S.A.S.

■ Equity method affiliates

Fujikura Automotive Morocco Kenitra, S.A.S.

FUJIKURA COMPOSITES Inc.

Fujikura Automotive Ukraine Lviv LLC

Fujikura Kasei Co., Ltd.

Fujikura Automotive Russia Cheboksary LLC

This index was developed by FTSE Russell, which is part of the London Stock Exchange Group. It
evaluates the sustainability of major companies in countries around the world on the three elementsof Environment, Social, and Governance (ESG). Companies with a superior overall rating are includedin the index.

FTSE Blossom Japan Index (from June 2017)* Selected as a Government Pension Investment Fund (GPIF) ESG Index
Developed by FTSE Russell, this index consists of Japanese company stocks deemed outstanding
from the perspectives of Environment, Social, and Governance.

S&P/JPX Carbon Efficient Index* Selected as a Government Pension Investment Fund (GPIF) ESG Index

This index was jointly developed by S&P Dow Jones Indices and Japan Exchange Group, Inc.
Companies in Japan that disclose sufficient environmental information and companies in Japan thatare highly carbon efficient are selected for this index.

Fujikura Automotive MLD S.R.L.
China
North and South America

Fujikura Electronics Shanghai Ltd.

America Fujikura Ltd.

Fujikura Shanghai Optical Components Co., Ltd.

Fujikura America, Inc.

DDK (Shanghai) Co., Ltd.

AFL Telecommunications LLC

Fujikura Fiber-Home Opto-Electronics Material Technology Co., Ltd.

Fujikura Automotive America LLC

Fujikura Zhuhai Co., Ltd.

Fujikura Automotive Mexico, S. de R.L. de C.V.

Fujikura Automotive Guangzhou Co., Ltd.

Fujikura Automotive Paraguay S.A.

Fujikura Hong Kong Ltd.

Fujikura Cabos Para Energia e Telecomunicacoes Ltda.

MSCI Japan Empowering Women Index (WIN)This ESG investment index was developed by the major US financial services company, MSCI. It is
composed of Japanese companies that lead their industries from the standpoint of gender diversity
through data and diversity initiatives such as the employment and promotion of women.
Note: F ujikura Ltd.'s incorporation of this MSCI index, and its use of the MSCI logo, trademark, service mark, and index name in thisrelease, does not constitute a sales endorsement, warranty, or support of Fujikura Ltd. by MSCI. MSCI indices are the soleproperty of MSCI. MSCI index names and logos are trademarks or service marks of MSCI and its affiliates.

Fujikura is a signatory to the UN Global Compact.
WE SUPPORT

93

Fujikura Group Integrated Report 2021

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94

Corporate GovernanceFujikura (China) Co., Ltd.

ESG Integration

Fujikura Logistics Co., Ltd.

Business Opportunities

Tohoku Fujikura Ltd.

Value Creation with “Tsunagu”
Technology

Number of shares held(Thousands)

Name of Shareholder■ Main Consolidated Subsidiaries (as of March 31, 2021)

Messages from Management■ Corporate Profile