YOKOWO
Integrated
Report2023

Corporate Philosophy

PurposeBe a good company by employing people and technologies
that work for the benefit of society today and tomorrow.

CONTENTS
Yokowo 2023 Integrated Report
Contents and Editorial Policy

01

Corporate Philosophy

02

Yokowo Global Network / Company Profile

03

Technical Evolution and History of Businessand Product Development

05

Value Creation – Our Track Record

09

Yokowoʼs Value Creation

Segment Overview

Sustainability

ESG Report

01

As an ever-evolving company, we seek to develop new
ideas that challenge our people and our technologies while
anticipating and addressing the changing needs of society.

Top Message

11

Yokowoʼs Value Creation Process

15

Yokowoʼs Materiality

17

Yokowoʼs Manufacturing

21

Research and Development

23

Product Technology

25

Yokowoʼs Business Domain

27

VCCS Segment

28

CTC Segment

29

FC/MD Segment

30

Sustainability Promotion Framework

31

Editorial Policy

Stakeholder Engagement

32

Corporate Governance33

Covered Organization: YOKOWO CO., LTD.
5 Domestic Group Companies
19 Overseas Group Companies
Period: Fiscal Year 2022 (April 1, 2022 - March 31, 2023)
Some of these activities include those from before
and after this period.

Directors, Auditors and Executive Officers 37

Appendix

VisionComplisance and Risk Management

38

Information Security

39

Environment

40

Employees

43

Diversity

45

Human Rights

47

Occupational Health & Safety: OH & S

48

Procurement

49

Local Communities

50

Financial Highlight51

Non-financial Highlight52

Financial Information

53

Independent Practitionerʼs
Assurance Report

62

Yokowo 2023 Integrated Report

ValuesRespect
Fairness
Ownership
Challenge
Innovation

Respect human diversity, keep an open mind and treat others with sincerity.
Act with fairness and transparency.
Take the initiative and be personally responsible for all your actions.
Be fearless, try new things and make the most of any situation.
Be flexible and consistently apply your skills to encourage innovative change.

Brand Slogan

Developing, Delighting

Published: November 21, 2023
Publishing Cycle: Annually
Information Disclosure:
The Yokowo Group discloses information accurately,
promptly and proactively in order to build long-term
relationships of trust with its shareholders, investors
and other stakeholders.
Forward-looking Statements:
Certain statements in this report such as “plan,” “forecast”
and “strategy” constitute forward-looking statements
and are based upon reasonable assumptions given theinformation available at the time of publication. Please
note that due to various factors, actual results may differ
significantly from those anticipated in such statements.
Department Responsible for the Report:
Public Relations & Equity Department,
SCI (Sustainability & Corporate Integrity) Promotion H.Q.
Tel: +81-3-3916-3111 (main number)
Inquiry Form:
https://www.yokowo.co.jp/english/inquiry/

Yokowo 2023 Integrated Report

02

YOKOWO GLOBAL NETWORK
Since establishing its Taiwan Plant in 1967, the Yokowo Group has been actively shifting production bases to overseas
locations so that it can build an optimal global production system. It currently operates mass production plants
primarily in Malaysia, China, Vietnam, and the Philippines. Overseas production now accounts for more than 80% of
Yokowoʼs total production.
In terms of sales, Yokowo has opened overseas offices in countries and regions worldwide with offices in fivecities in the Americas, in Germany in Europe, and in nine Asian countries to provide local-based sales services closely
matched to market needs around the world.

USA
YOKOWO AMERICA CORPORATIONYOKOWO AMERICA CORPORATION
Silicon valley office

Korea

YOKOWO AMERICA CORPORATION
Tempe office

YOKOWO KOREA CO., LTD.

YOKOWO MANUFACTURING OF AMERICA LLCChina

YOKOWO MANUFACTURING OF AMERICA LLC
Detroit office

DONGGUAN YOKOWO CAR COMPONENTS CO., LTD.
DONGGUAN YOKOWO COMMUNICATIONCOMPONENTS CO., LTD.

ChicagoYOKOWO CORP. (H.K.) LTD.

Germany

Silicon Valley

YOKOWO (HONG KONG) LTD.

YOKOWO EUROPE GmbHYOKOWO VIETNAM CO., LTD.

India

Hong Kong OKOWOYMICRO TECH
CO., LTD.

Japan
Utsunomiya
Tomioka
Tokorozawa
Tokyo

Philippines

Lumax Yokowo Technologies Pvt. Ltd.

ThailandYOKOWO (THAILAND) CO., LTD.

Malaysia

Production

TaiwanDongguan

YOKOWO ELECTRONICS VIETNAM CO., LTD.

YOKOWO ELECTRONICS (M) SDN.BHD.

Sales

Columbus

Tempe

VietnamYOKOWO EUROPE GmbH
Düsseldorf office

Detroit

Production & Sales

 OKOWOY
MANUFACTURING OF
THE PHILIPPINES, INC.

Osaka

 OKOWO (SINGAPORE)Y
PTE.LTD.

Headquarters
Itabashi officeOsaka branch

Chubu

Chubu branch
Utsunomiya branchPhilippine office

MEMS development center

Singapore

Tomioka plant

YOKOWO (SINGAPORE) PTE.LTD.

LTCC Materials Co., Ltd.

Company Profile (As of March 31, 2023)
Company Name

Head Office
LocationFoundedIncorporated
Capital
Number ofshares issuable
Number ofshares issued
Number ofshareholders

YOKOWO CO., LTD.
JR Kanda Manseibashi Bldg. 14F,
1-25, Kandasuda-cho, Chiyoda-ku,
Tokyo 101-0041,
Japan

Shareholder

Number ofPercentage ofshares held
shares held
(in thousands)

The Master Trust Bank of Japan, Ltd.

3,820

16.3

Custody Bank of Japan, Ltd.

2,362

10.1
4.2

September 1, 1922

The Gunma Bank, Ltd.

990

June 14, 1951

Yokowo Business Partners Shareholders’ Association

799

3.4

¥7,819 million

BNP PARIBAS SECURITIES SERVICES LUXEMBOURG/JASDEC/FIM/LUXEMBOURG FUNDS/UCITS ASSETS

790

3.3

Mitsubishi UFJ Trust and Banking Corporation

595

2.5

JP MORGAN CHASE BANK 380684

534

2.2

The Dai-ichi Life Insurance Company, Limited

450

1.9

Companyʼs Stock Investment

447

1.9

40,000,000 shares
23,849,878 shares, including
538,808 treasury stock shares
6,425* The head office location was changed by a resolutionof the general meeting of shareholders in June 2023.

03▼ Major Shareholders (As of March 31, 2023)

Yokowo 2023 Integrated Report

MUFG Bank, Ltd.

446

▼ Net Sales by Region (FY2022)
18,58026,400▼ Net Sales / Share of Total Overseas Sales

32,980Net sales (million yen)0

10,000Japan

20,00030,00040,000Europe and America

50,00060,00070,000(million yen)Asia

70,00063.2

66.4

Share of total overseas sales (%)
76.2
80
72.2
67.3
70

60,00050,000▼ Number of Employees by Region (FY2022)
2,417

3,261

600

984

1,042

1.9

* The Company holds 538 thousands of its treasury stocks, but not counted as a major shareholder.
* The number of shares is rounded to the nearest thousand.
* Percentage of shares held is calculated without 538 thousands of treasury stocks and is rounded
to the nearest third decimal with numbers of less than one-hundredth of one percent omitted.

80,0000

1,000China*1

2,000

3,000

Vietnam*1

4,000
Malaysia*1

5,000

6,000

Japan*2*1 Major Production Bases *2 YOKOWO CO., LTD.

7,000

8,000

(Unit: person)

Other

60

54,75260,59559,976

66,84877,96250

40,00040

30,00030

20,00020

10,00010

02018■ Net sales

2019
2020
2021
2022
Share of total overseas sales （FY）

Yokowo 2023 Integrated Report

004since 1922

History of its TechnicalFounding - 1960s

1970s

VehicleCommunication
Equipment
Business 1957〜

The rod antenna for transistor
radios, hit products at that time,
was what propelled Yokowo
Manufacturing Co., Ltd. to theforefront. Yokowoʼs high-quality
antennas with their smooth
extendibility based upon precisionpipe processing technologies
garnered recognition fromelectronics manufacturers. In thisway, antenna technologies becamea core business for the Company.

Car Antenna(Pillar Type）

Rod Antenna

100years

Evolution and Business/Product Development
1980s

AM/FM
Motor Antenna

Extension
Cable A’ssy

Motor Operated Conner Pole

Microwave Components
1983〜

Low Noise Block Down Converter

Outdoor Unit
for BS

1956〜2003

Personal
Communication
Antenna

Rod AntennaSporting Goods
1959〜1995

Golf clubs andshafts

Metal Bats
for Softball

In the midst of the leisure boom
during the period of high economic
growth, Yokowo took advantage
of our pipe technologies to begin
manufacturing and selling golf
clubs and shafts. The Company has
also expanded into metal bats andshafts for rackets.

Metal Bats

Microwave Technology
Pipe
Drawing
Technology
Spring Bar,
Founderʼs
Invention

Antenna Technology

Golf Shafts Promate

Micro Precision Processing Technology
Precision
Pipe
Processing
Technology

Spring bar craftsmanship transformed
into advanced, world-classtechnologies. These advanced, micro
precision processing technologies
bring unique, original products that
only Yokowo can provide, and theseare bearing fruit in diverse eldssuch as semiconductor inspection,connectors for electronic devices, andadvanced medical equipment.

As the founder of Yokowo Manufacturing Co., Ltd., the predecessor of YOKOWO CO.,LTD., Chutaro Yokoo (1894 to 1977) refined his skills as a craftsman producing precisionpipes used in pocket watch hinges. When wristwatches entered the mainstream, heinvented the spring bar. This is a belt-attachment component comprising a spring
inserted into an ultra-thin pipe, so it can expand at both ends. This landmark invention
became widely adopted overseas, capturing the worldʼs largest market share. This was
the starting point of “technical Yokowo” that exists to this day.

Everything Started with Pipes
After having finished his apprenticeship in 1922, Chutaro Yokoo decided to go out on
his own and start a business, opening the Seirinsha bicycle shop the next year. This wasdestroyed on the day of opening by the Great Kanto Earthquake, but reopened just one
month later.
In 1926, using the skills he had acquired over 15 years as a craftsman, he opened aprecision pipe processing factory in Mukojima, Tokyo.
Thus was born Yokowo Manufacturing Co., Ltd., the predecessor of YOKOWO CO., LTD.

05

Full-scale introduction of
microwave technologies at thelaunch of satellite broadcast
services. Since then, Yokowo has
deployed microwave equipment
for satellite broadcasting and VSAT,
and it is now an important coretechnology in the Companyʼs VCCS
and CTC business, with significant
contributions to supporting 5G
throughout its product line-up.

Yokowo 2023 Integrated Report

Circuit Testing
Connector Business
1979〜

Specications required for probes
and sockets for semiconductor
testing are becoming more
and more exacting, due to theminiaturization and increased
performance of semiconductors.
Yokowo started its circuit
testing connector businessin 1979, providing the world
with semiconductor testing jigs
developed using microwave
technology, in addition to its
world-class micro precision
processing technologies.

Contact Probe

Interface
Connector

IC TestSocketFine Connector
Business 1986〜
SPRING CONNECTOR™

Board to Board
Coaxial Connector

Yokowo 2023 Integrated Report06Until now, and from now on.
Using technology, Yokowo will continue to pioneer
1990s

the next generation.

2000s

VehicleCommunication
Equipment BusinessGPS
Antenna

Amplifier for
Glass Mounted
Automobile
Antenna

Diversity
Antenna for
Automobile TV

AM/FMMicro Antenna

Antenna for
SDARS

Microwave Components
Transmitter
for VSAT

Tollgate Antenna
for ERP

Rod Antenna

Cellular AntennaSporting Goods

2010s
Laminated Antenna for Digital
Terrestrial Wave (Front Type)

Yokowo provides the worldʼs leading
automotive manufacturers withhigh-sensitivity, high-quality, and durable
vehicle antennas supporting wide
frequency bands. The world-leading microantennas developed by Yokowo havetransformed vehicle radio antennas frombeing mechanical to electrical components.

Multiband Internal Antenna
for Cellular Phone

Wire Coupled Antenna

Yokowo — towards a new 100 years

Combined Roof
Antenna (Hex Band)

Tollgate Antenna
for ETC

AM/FM
Shark Fin Antenna

2020sCombined Roof Shark Fin
Antenna (Cellular/GPS/SDARS)GNSSAntenna

These days, the communications
environment continues its
dramatic evolution, with 5G,
IoT, etc. Yokowo will continue
to leverage its world-leading
technology and originality
to offer the unique antennas
demanded by society.

Tire Pressure
Monitoring System

Yokowoʼs LTCC business, based upon ceramics
technologies, has been in commercialization since
the early 2000s. In 2019, Yokowo established a joint
corporation as LTCC Materials Co., Ltd., achieving
an integrated production system from materials
development through to product manufacturing.

OpticalTransceiver

Ceramics &Electronic Devices
1996〜

Golf Shafts
Prelude Pro

Incubation
Center 2023〜

Patch Antenna
for GPS

Chip Antennafor Bluetooth

LTCC Interposer
Substrate

12inch Interposer
Substrate

Ultra Thin
LTCC-CSP
Substrate for LED

Ultraminiature
LED Ring Lightof LTCC

4G/5G Antenna
Supporting 2×2
MIMO

Substrate for
VehicleMicrowave Components
Antenna Technology
Special surface processing ofmaterials adds value to products,
including in terms of abrasion
resistance, heat resistance, adhesive
capabilities, and appearance. This is apromising technology that promotes
product differentiation and highfunctionality.

Micro Precision Processing Technology
Ceramic Technology

Surface Modication Material Technology
Circuit Testing Connector Business

LCD Panel
Test HeadBGA Test
SocketLow Profile
Contact Probe

High Giga
SocketVertical Probe
Card

Micrograph of
Mechanics Parts

Penprobe

MEMS Probe
Card (YPX)High Giga Full
Shield Coax Socket

Fine Connector BusinessCoaxial Connector
for Antenna

Multi-Contact CoilConnector

2-Piece Blade
Connector

Board to FPC/
Micro Wire Connector

Waterproof
I/O Connector
Lead Socket Connector

Optical Connector

Test Tools for
FPC/FFC, Connectors
1993〜

Clip Connector

Microwave Module
Test HeadMicrowave
Function Probe

Probe Connector /Giga Holder

Clip Connector for Board
to Board Connector

Board to Board Stamp

Medical Device
Business 2006〜
Micro Precision
Tip Terminal
Processing Devices for Catheter
for Medical(Radiopaque Marker)

07

Yokowo 2023 Integrated Report

Core Wire

Coil for
Guidewire

Assembly of Atrial
Septal Needle

Inspection Tools
for Interface
Connector

Waterproof 2-Piece
Blade Connector

Board to Board Connector
Test Tool for 5G Smartphones

Yokowo has been commercializing medical devices as its fourthpillar since 2006, taking advantage of its micro precision processing
technology. In 2012, Yokowo acquired ISO 13485 (medical equipment
quality management system) certification, and through a startup
ecosystem in collaboration with academia, industry, and government,
is aiming to provide innovative medical equipment.

Yokowo 2023 Integrated Report08Value Creation – Our Track Record'94

Established DONGGUANYOKOWO ELECTRONICS
CO., LTD. in China.
'01(merged with DONGGUANYOKOWO CAR COMPONENTS
CO., LTD. in 2017)●

Yokowo started with precision metal pipe processing developed by its founder, Chutaro Yokoo, at the time when he
was a craftsman in the industry. From these beginnings, Yokowo introduced various new technologies centered on
micro precision processing, expanding the business to a wide range of fields.
With Tomioka Town within Kanra District, Gunma Prefecture (now Tomioka City), where the founder was born andraised, as the center of development and production, Yokowo is developing and providing cutting-edge products forthe global market while expanding its bases overseas.

'02

2000

2010

Listed on the first sectionof the Tokyo Stock
Exchange.

●'11Established YOKOWOVIETNAM CO., LTD. in
Vietnam.

●

2020
'20

Established YOKOWO
MANUFACTURING OF
AMERICA LLC in Hilliard,
Ohio, U.S.A.

Established YOKOWOEUROPE GmbH inGermany.

●

●

●

 stablished Lumax
E
Yokowo Technologies
Private Limited in India.
E stablished YOKOWO
MANUFACTURING OF
THE PHILIPPINES, INC. in
Philippines.

●

1920
'22

●

1960

F ounded YOKOWO MFG.
'61
CO., LTD. in Sumida, Tokyo.

1980

Established Tomioka plant '83
in Kanohara, Tomioka.

● 	

●

Around 1930
Developed a Spring Bar for
watches that, at that time,
captured the largest share of
the global market.

●

'87

S tarted PersonalCommunication Antennabusiness.
(withdrew in 2014)

'62

●

'56

●

'96

●

Established DONGGUANYOKOWO CARCOMPONENTS CO., LTD.
in China.

Established YOKOWOELECTRONICS (M) SDN.
BHD. in Malaysia.

Developed the world’s
first Micro Antenna for
automotive AM/FM radio.

'67

Began OEM supply ofvarious satellite broadcast
reception devices in tandemwith NHK’s launch ofsatellite broadcast services.

Listed on the second
section of the Tokyo
Stock Exchange.

Cellular Phone Antenna

Micro Antenna

Established YOKOWO
MFG. CO., (TAIWAN) Ltd.
(now YOKOWO MICROTECH CO., LTD.)

Incorporated.

1970

●

Established YOKOWO(HONG KONG) LTD.

● 	

Completed new head
office in Tokyo.

● 	S tarted Microwave
Component business.
(transferred to the Vehicle
Communication Equipment
business in 2002)

Started Vehicle Communication
Equipment business.

●

'79

	Established YOKOWO(SINGAPORE) PTE. LTD.
Started Circuit Testing
Connector business.

● 	

'84

'97

●

'86

Established YOKOWOAMERICA CORPORATION
in Chicago, U.S.A.

●

S tarted Fine Connectorbusiness.

'90

●

'92

●

Changed company
name to YOKOWO
CO., LTD.

Developed asmall-sized ceramic
patch GPS Antenna.

SPRING CONNECTOR™

'07

'99

Established
DONGGUAN YOKOWOCOMMUNICATIONCOMPONENTS CO., LTD.
in China.

●●

GPS Antenna

09

Yokowo 2023 Integrated Report●E stablished YOKOWO
Europe Ltd. in London,
U.K.

2-Piece Blade Connector

Started Medical Device
business.

'21●H eadquarters

relocated to JR Kanda
Manseibashi Building.

Commercialized the YPXprobe card series for thetesting of high frequency
devices using MEMS
technology.

YPX Series

'14

●

'16

●

●

'22

Transitioned tothe prime marketof Tokyo Stock
Exchange, in
accordance withthe restructuring ofmarket segments.

●

Acquired ISO 27001
certificate.

Acquired OHSAS 18001
certificate.(Transferred to
ISO 45001 in 2020)

Established YOKOWO
FUTURE-ORIENTEDSUPPORT CO., LTD.

●Installed aphotovoltaic power
generation system atVietnam Plant.

●

Established Advanced
Measurement Technology
Center in Tomioka plant.

●

Established YOKOWOELECTRONICS
VIETNAM CO., LTD. in
Vietnam.

●

Established YOKOWO
Advanced Device Center.
(reorganized into a joint
corporation in 2019)●

YOKOWO
Advanced
DeviceCenter'08

Acquired ISO 13485
certificate.

D eveloped a 2 Piece
connector to make a fullentry into the rugged
handheld device market.

Components for Medical Devices(Tip Terminal of Catheter)

BGA Test Socket

Started Sporting Goods
business. (withdrew in 1995)

Golf Goods eveloped a BGA Test
D
Socket to make a full entry
into the semiconductor'06
inspection market.

1990

●

Contact Probe

'13

'18

● 	

AM/FM Motor Antenna

'59

●

Established YOKOWO CORP.
(H.K.) LTD. in Hong Kong.

Microwave Components
●

'12

●

Ceramic Antenna

Rod Antenna

Pillar Antenna'05

Outdoor Unit for BS

'89

'78

Guide Wire for
Medical Treatment

Hi-Giga Sockets

Started Microwave
Ceramics business.

●●Started Rod Antennabusiness. (withdrew in 2003)D eveloped the industry’s
first socket for
high-frequency testing.

● 	Personal Communication Antenna

'73

'57

Established YOKOWO
KOREA CO., LTD. in
Korea.

●

●

● 	

1950
'51

●

●

●

Tomioka Plant

Spring Bar'95

Began OEM supply of
Guide Wire for medical
treatment.

●

Took over probe cardbusiness from Genesis
Technology Inc.

●

Established YOKOWOMEMS development center.

●

AMT Center'19

Registered the®
SmartWeld trademark
for its original technology
for bonding different
metallic materials.

●

Established a joint
corporation as LTCC
Materials Co., Ltd.

●

'23

●

 stablished the Micro
E
Process R&D Center(MP Center) in the
Tomioka Plant.

Yokowo 2023 Integrated Report10

Yokowoʼs Value Creation

Top Message

More than a century after
our founding,remaining relevant for
the next 100 years
GO BEYOND~Challenge the Next Stage~

Takayuki Tokuma

Representative Director,
President and Executive Officer
YOKOWO CO., LTD.

structure (industry, customers, technologies, supply chains, andother layers).
By promoting this sustainable evolution of business
management and a multi-layered business structure, we hope toachieve our “Minimum 10” medium-term management index(secure at least 10% in operating profit growth rate, operating
profit margin, return on equity (ROE), and return on invested
capital (ROIC)).
For the fiscal year ending March 31, 2024, areas ofparticular focus are human capital management and capital
cost management. In human capital management, we aremethodically implementing initiatives to respect human rights,
such as the establishment of the Yokowo Group Human
Rights Policy (see p.47), and under the leadership of the newly
established Human Resources Development Center, we areworking to both develop superlative human resources, andraise their operational abilities and skill levels. In capital costmanagement, in the medium term we hope to achieve a
ROIC of 10% after calculating the Groupʼs cost of capital withreference to competitors and comparable companies. We have
moved from a profit-and-loss bias toward a focus on capitalefficiency, and are concentrating efforts on maximizing returns
with methods such as the so-called reverse ROIC tree.

Yokowo will work towards achieving its new “Minimum 10” medium-term
management index, to ensure that it is a constantly evolving company.
Constantly evolving, advancing to the next level.
Performance and earnings forecasts, along with our vision for the future are presented below.

Basic Management Policy
In 2022, on the occasion of our 100th anniversary, we set forth
Purpose, Vision, and Values as our new corporate philosophy
looking towards the next 100 years (see p.2). To this end, Yokowo
has instituted two management policies—the sustainable evolutionof business management, and a multi-layered business structure.
As per our slogan of “Constantly on the cutting edge”
put forward since our founding, sustainable evolution ofbusiness management refers to constant evolution andprogress. Measures for realizing the sustainable evolutionof business management are product innovation (including
business model, product and business structure innovation),process innovation (the innovation of business processes) andpersonnel innovation (human resources innovation). In otherwords, these measures aim to substantially change the businessstructure, including products, technologies, and markets andbusiness operating process through the optimal placement

11

Yokowo 2023 Integrated Reportof business sites and the active introduction of production
processes, processing technologies, and IT. The diversity of
the human resources who operate the above will expand toensure the development of highly professional teams. In linewith management innovation (the innovation of corporate
management and business operations), substantial changes will
be made to how the elements and systems involved in thesethree innovation measures, as well as how these measures
themselves are managed, in order to accelerate the evolutionof business management.
The other management policy of the multi-layered businessstructure aims to enhance the stability of our corporate
management and our companywide earnings structure. In otherwords, we aim to improve sustainability. As the management
environment surrounding Yokowo is changing drastically, thismanagement policy aims to establish a tenacious businesssystem capable of responding flexibly to these changes in thebusiness environment by creating a multi-layered business

Recent Operating Results and Forecasts
Performance in the Fiscal Year Ended March 31,
2023, Current Status and Forecasts
The fiscal year ended March 31, 2023 saw a general slowing in
new COVID-19 infections, however the global economy has still
not fully recovered from its impact. In particular, the automotive
and other industries which depend on complex global supply
chains have needed a long time to normalize their procurement
and logistics operations.
In addition to the situation in Russia and Ukraine and the
deepening friction between the United States and China,
rapidly rising prices in countries around the world have caused aslowdown in the global economy. The semiconductor industry saw
booming demand from stay-at-home and teleworking demandduring the COVID-19 infections, however this slowed sharply inthe second half of the fiscal year due to the economic downturn.
Under these circumstances, the Yokowo Groupʼs consolidated
net sales reached a record high of 77,962 million yen (up 16.6%
from the previous year) thanks to steady growth in overseas
sales, due in part to the continued significant depreciation of
the yen. The Wireless Communication Equipment segment
saw sales decline slightly from the previous fiscal year, however

New Corporate Vision● Purpose: Be a good company by employing people and technologies that work for the benefit of society today and tomorrow.
● Vision: As an ever-evolving company, we seek to develop new ideas that challenge our people and our technologies while

anticipating and addressing the changing needs of society.
● Value: Respect, Fairness, Ownership, Challenge, and Innovation

Evolution of Business Management

Multi-layered Business Structure● Multi-layered business structure● Product innovation(industry, customers, technologies, supply chains and other layers)● Process innovation● Personnel innovation

Global paradigm shift/Establishing a business systemcapable of responding to drastic changes in businessenvironment and competitive environment● Management innovation

Realization of Minimum 10● Operating profit growth rate
● Operating profit margin● Return on invested capital● Return on equity

10% or more
Yokowo 2023 Integrated Report

12

Yokowoʼs Value Creation

both the Vehicle Communication Equipment and Circuit Testing
Connector segments recorded record highs. Operating profit
increased 1.2% year-on-year to 4,739 million yen, a significant
drop from the target of 7,200 million yen in the medium-term
management plan. This was due to the Circuit Testing Connector
segment posting remarkable profits in the first half, but seeing
a sharp drop in the second half due to reduced demandin semiconductor testing, and the Vehicle Communication
Equipment segment posting a large operating loss.
In the current fiscal year ending March 31, 2024, the 101st
year since our founding, we are continuing to face an adverse
business environment. As of November 2023, we are projecting
a very difficult situation with consolidated net sales at 75 billion
yen (down 3.8% from the previous year) and operating profit
at 200 million yen (down 95.8% from the previous year). The
VCCS (platform business split off from Vehicle Communication
Equipment in the previous fiscal year) segment returned tooperational profitability because of fluctuations in orders,normalization of ocean freight rates, and business structurereforms, however the CTC (until last fiscal year, Circuit Testing
Connector) segment is expected to see a halving in sales due tothe ongoing recession in semiconductors, making an operating
loss unavoidable. Sluggish sales in the Fine Connector (FC)business meant that the FC/MD (advanced devices business split
off from Wireless Communication Equipment in the previous
fiscal year) segment is also expected to post an operating loss.

Reaffirming our original corporate DNA,and having this guide our actions
While we may be facing difficult times, I am not in myself
pessimistic. Rather, I feel this is a good opportunity to reaffirm
the corporate DNA that we have inherited since the companyʼsestablishment, and by using this in our activities, further embed

it into our culture. Our corporate DNA comprises a spirit ofchallenge in leveraging our strengths to boldly explore new fields
and markets, along with a flexibility to strategically withdraw
from businesses that no longer appear to present prospects
for profitability and growth and to consistently develop new
businesses, combined with the tenacity and determination tounderpin these. When looking back at our companyʼs history,
the most serious periods were the business crunch at the end of
the 1970s, and the Global Financial Crisis (GFC) following thecollapse of the Lehman Brothers in 2008. The former resulted
in us carrying out a major transformation—within the company
we referred to this as our second founding. We started our CTC
and FC businesses at this time, and these became driving forces
behind a major transformation of our business structure. Afterthe GFC, incoming orders dropped to 70% of previous levels. As
well as making drastic cuts to our fixed cost structure that had
previously ballooned due to our expansion policy, we enhanced
the stability of our business operations and performance throughmulti-layered business structure measures. These were achievedby creating new sales and rebuilding our earnings structurewith the three innovation measures that make up sustainableevolution of business management.
Demand for semiconductors and semiconductor testing iscurrently declining, but it is expected to return to growth in thenear future, given that more advanced and higher numbers ofsemiconductors will be used in CASE*1 / MaaS*2 / AI / 5G / IoT, for
cutting-edge applications, which are seeing further developments.
Until that point, we will prove our worth by tenaciously enduring
and taking the next bold steps, thus ensuring we seize theopportunities for recovery and advancement.

■ New medium-term

Net Sales

Net sales (million yen)

■ Full-year

management plan

performance¥72 billion¥

77.9 billion

Operating profit (million yen)

90,0008,000

80,0007,000

70,0006,000

60,0005,000

50,000Operatingprofit13¥

7.2 billion¥

4.7 billion

Ordinary
profit¥

7.0 billion¥

5.6 billion

Profit attributableto owners of parent¥

5.0 billion¥

3.1 billion

Yokowo 2023 Integrated Reportissues: the environment, local communities and diversity andinclusion.

Since being appointed as President in 2007, I have constantly
conveyed my desire to make Yokowo a good company to ouremployees. I think that a better company is:

Confronting sustainability issues is a part of our business
operations, and we must continue these without interruption.
Accordingly, we are focusing on our succession plan. We areworking on a succession plan that covers not only top management
but also officers and general managers, and we believe that this willlead to our company becoming sustainable, and thus bring about
the realization of our goal—becoming an ever-evolving company.

■

■

■

*1 Acronym for Connectivity / Autonomous / Shared / Electric, new trends inautomobiles.
*2 Mobility as a Service▼ Earnings trends during the period of the
new medium-term management plan
<Fiscal year ending March 31, 2023>

So we can achieve sustainability with
our stakeholders

4,000

40,0003,000

30,00020,0002,000

10,0001,000

0FY ended
March 2020
Performance

FY ended
March 2021
Forecast at
start of term/
Performance

Personal Communication Equipment
Circuit Testing Connector
Vehicle Communication Equipment

FY ended
March 2022
Forecast at
start of term/
Performance

FY endingMarch 2023
Medium-term
objectives/
Full-year performance0

Operating profit
Operating profit forecast at start of term/Targets

A company about which customers say, “It was good that wehave conducted business with Yokowo. We will expand ourbusiness relationship with Yokowo.”
A company about which contractors say, “It was good that
we performed business operations for Yokowo. We will work
harder to contribute more.”
A company about which local communities say, “Iʼm glad
Yokowo is in our town. Iʼd be very happy for my children tojoin Yokowo.”

And most importantly, a company where the employees of the
Yokowo Group think, “I am very satisfied with to be working
for this company. I will work harder to make it an even better
company.”
I think that a company such as that is truly a good company.

■

To make Yokowo a good company, we should ensure that
officers and employees of the Yokowo Group both within
Japan and overseas, regardless of nationality, gender and other
differences, are content and fulfilled in their work, and havea foundation of reliability and trust. Through the evolution of
our technology, we will continue to offer quality products andservices to improve customer satisfaction. We will contributeto local communities which we rely on to ensure that we arewelcomed by them, and to bring satisfaction to our neighbors.
As a resident of this world, we will contribute to solving climatechange and other issues to preserve the natural environmentthat sustains the lives of people around the world, including of our
stakeholders. Based on the above, we have the three top-priority

The Yokowo Group will continue to enhance our governancesystem, a foundational, basic part of our corporate activities, inorder to achieve Purpose, Vision, and Values in our actions.
Further, so that we can be a Company needed over the next
100 years, we will confront sustainability issues such as climatechange through our business activities, and contribute to thesustainable development of our global society.
In the years to come, we look forward to the ongoingsupport, guidance, and encouragement of our shareholders andother stakeholders.

Yokowo 2023 Integrated Report

14

Yokowoʼs Value Creation

Yokowoʼs Value Creation Process
While utilizing our “six types of capital,” the Yokowo Group provides value to society through a multi-layered combinationof our core competencies (micro-precision processing, microwaves (high-frequency), and advanced devices). Looking forward,
our aim is to achieve a sustainable society through our business activities that are based upon the four pillars of our basic
management policies, and to strive to continue to create value unique to Yokowo.

Key Inputs●

Production capital●

77.96 billion

Proposing products needed by
future generations, utilizing ourcore technologies
Details→ p.23●

CTC
Details → p.29

Expanding sales to five cities in
the Americas, and ten countries
and regions in Europe, Asia, andaround the world
Details→p.3

Improved, more resilient social
infrastructure

Details → p.30

・Probe Cards
・Hi-Giga Sockets

Human resource training
making the most of diversity

FC/MD
・SPRING CONNECTOR™
・Guide Wires / Catheters
Assembly Products

Building of a fair working
environment* SDGs: Abbreviation of Sustainable Development
Goals. These were adopted by the United Nationsin 2015 as common goals for 2030, to confront
issues such as poverty and climate change

Social capital

Basic Management Policy・Overseas group companies:

Details: https://www.yokowo.co.jp/english/ir/message/

5

19

Quality first(establish the “Yokowo Quality Brand”)

Natural capital・Electricity 36,633 MWh
273,845 m3
・WaterTechnology-based enterprise

Yokowo 2023 Integrated Report●

Vision to be an ever-evolving company

Greenhouse gas
emissions(Scope1+Scope2)

Promotion of evolutionary
management(four innovations)

Multi-layered businessstructure

Global business base

15

FC/MD

・Domestic group companies:●

Improved traffic and transport

CTC

4. Sales・Total assets: ¥70.65 billion
・Cash & cash equiv.:¥17.68 billion●

Building the worldʼs preeminent
local production system

Financial capital

Innovations in information andcommunication technology

Improvements in daily safety
and comfort

Representative
products

・Shark Fin Antennas
・GNSS Antennas

3. Production

8,304

Related SDGs*

VCCS

Carrying out green procurement

Human capital

Addressing social issues

Providing minimally invasive
medical equipment

2. Procurement

●

Sales

1. Development

Intellectual capital・Employees:

Reduction in environmental
impact¥Details → p.28

・Patents held:
1,053
・R&D expenses:¥4.36 billion●

Value Provided to Society(FY2022)

VCCS

・Non-current assets:¥24.3 billion
・Capital investment:¥5.44 billion●

Key Outputs

Yokowoʼs Business Activities(FY2022)▶VisionYear-on-year+749 t-CO

2

As an ever-evolving company, we seek to develop new ideas thatchallenge our people and our technologies while anticipating andaddressing the changing needs of society.

Yokowo 2023 Integrated Report

16

Yokowoʼs Value Creation

Yokowoʼs Materiality
In 2020, Yokowo identified our materiality as a Group. This clearly states managementʼs will and the contribution
to society made through our business activities, and incorporates the desire of our management to “make Yokowo
a good company.” Through the promotion of innovation and reforms to business models, we are both sustainably
growing our business, and contributing to the environment, society, and diversity.
① Be a company that customers and theircustomers feel comfortable working with

② Be a company that society (including local
communities) and its business partners feel
comfortable interacting with

● Establishing the “Yokowo Quality Brand” focusing on thehighest quality, and on zero hazardous chemical substances● Dialog with local communities and contributions to theirdevelopment“Make Yokowo a good company”
̶ Three Wills❶ Be a company that customers and theircustomers feel comfortable working with■

❷ Be a company that society (including local
communities) and its business partners
feel comfortable interacting with■

❸ Be a company where employees feel

comfortable being employed, and which
ensures that employeesʼ families are
happy for them to work there

High quality, high productivity, and reduced environmental impact resulting fromreforms in production processes through the New 5S (Simple, Slim, Small, Short,
Smooth) Concept, and through AI
Enhancing a research and development system that promotes more in-depth andadvanced world-class micro precision processing and microwave (high frequency)
technologies, as well as reducing our environmental impact through thedevelopment of ultra-compact, energy-saving products(3) After reviews by the Board of Directors
including outside directors and outside
Audit & Supervisory Board Members,
approval of items and KPIs.

■

Entering into a naming rights partnership agreement with Tomioka City■

Trash cleanup activities around the Tomioka plant■

Tomioka City Educational Fund, Tomioka World Heritage Exhibition
Maintenance and Management■

Agreement on Gunma University Industry-academia Collaboration■

Promoting the F0 (zero defects) Conference and other quality improvement activities■■

Integrated management of technologies using PLM, and improvements to quality
pre-verification functions using Digital Twins

Donations to the Rotary Yoneyama Memorial Foundation and Disaster Relief
Funds through the Tomioka Rotary Club■Work through Tomioka City and the Tomioka Chamber of Commerce &Industry to promote solutions to local issues■

Education assistance for elementary, junior high, and high schools■

Participate in Gunma Tech Planter as a regional development partner■

Contribution to local revitalization through expanded hiring of foreign staff
in the Tomioka area (utilizing TISP)■

Promoting activities to provide support for SMEs and for the cultivation ofyoung people who will play important roles in the future, as a sponsoring
member of the Certified Management Support NPO Club, a Specified
Nonprofit Corporation registered with Tokyo Metropolitan Government

Reducing environmental impact through our business activities
Promotion of recycled materials in plastic molding, and reductions in waste
Moving to plastic-free packaging and transport pallets, and conversion to biodegradable plastics
Recycling of cutting oils, etc. (joint research with universities and technical colleges)
Establishment and operation of Green Procurement Guidelines● Contributions to treatment of illnesses and rare diseases(2) Refine themes and set targets throughworkshops with General Managers ofbusiness divisions and Chief Officers ofbusiness strategy divisions.

Donations to local governments, and sponsorship of local events

Utilizing our antenna and software technologies to break into the field of MaaS

Process to Identify Materiality(1) List themes considered by the company
or its stakeholders to be important frommanagement policies, medium-term
management plans, specific materiality by
SASB industry, etc.

Employment of local residents

■

■

■

Specific processes are as follows:■■

Development of innovative medical devices through the use of our world-classmicro precision processing and microwave (high frequency) technologies■

Industry-academia open innovation (Gunma University, University of Tsukuba,
Tokai University, Kobe City Medical Center General Hospital, UCLA, etc.)■

Construction of an ecosystem with universities, hospitals, and startup businesses(startup ecosystem)■

Fair and equitable selection, and compliance with the Subcontracting Law■

Building relationships as an equal partner■

Formulating and promoting concrete measures in response to climate change inorder to realize carbon neutrality by 2050.

Building a checking system to eliminate unethically mined resources, etc.
(conflict minerals monitoring system)■

Multi-layered product sites (VCCS segment: Stabilization of a third production base)Responding to climate change■

Construction of a fault-tolerant supply network (duplicated lines andnetworking)■

Strengthened support system with Tier 2 and Tier 3 suppliers● Contribution to the conservation of biodiversity■● Fulfilling social responsibility throughout the supply chain

Formulating concrete measures that conform to the recommendations of the
Task Force on Climate-related Financial Disclosures (TCFD)
Disclosure using the Carbon Disclosure Project (CDP) framework■

Water resource management (reductions in water usage, improved wastewater
treatment)■

Resource recycling (reductions in waste quantities, promotion of zero emissions)(4) Organize the relationship with CSR issues,and clearly detail the specified results in
the integrated report and on the website.
● Strengthened compliance and governance● Establishment of a global BCP system, and constant testing to
improve its effectiveness● Building of a check system in cooperation with local
governments and NPOs to eliminate child labor andunethically mined resources, etc.

■■■

Three Priority Issues (Materiality)

Related SDGs

③ Be a company where employees and their families feel
comfortable being employed, and which ensures that
employeesʼ families are happy for them to work there● Promotion and development of workforce diversity andinclusion■

Promotion of the TISP (Tomioka International Specialist Park) concept
Employing around 100 specialists from overseas and establishing business management
processes in which collaboration with overseas staffs is considered normal will stimulate
business activities that make the most of this diversity, and through improved living
environments we will contribute to regional interaction and revitalization.

■

Expansion and development of womenʼs careers
Revising and promoting the action plan in accordance with the Revision of the Act
on Promotion of Womenʼs Participation and Advancement in the Workplace, andexpanding and reinforcing this throughout the PDCA cycle
Revising and promoting the action plan in accordance with the Act on Advancementof Measures to Support Raising Next-Generation Children, and expanding andreinforcing this throughout the PDCA cycle
Improving work-life balance by establishing on-site company nurseries■

Creating a workplace environment allowing all employees to play an activerole regardless of age■

Establishing a special subsidiary to provide employment for persons withdisabilities and expand their opportunities for participation● Achieving an appealing, rewarding work environment■

Improving work-life balance by establishing a teleworking system■

Improving work-life balance by encouraging employees to take annual paid leave■

Improve employee satisfaction by expanded support for injury and illness
prevention and treatment■

Establishment of awards system, including for social contributions■

Get-together Interactive meetings (product technologies, production
technologies, QC)■

Establishment of a global employee promotion and HR treatment system■

Establishment of an Advanced Technical Research and Development Center toprovide an appealing working environment for technical personnel■

Offering advanced technical training opportunities (AI and other graduate
education, business school, external research organizations)■

Reform of the human resources system with a focus on career development
support and enhanced engagement● Expanding long-term training and apprenticeship programsin Japan for employees in locations overseas thus improving
their abilities, and establishing a human resources system with
global applicability

Strengthened risk management (establishment of Business Risk Management Committee, disclosure of major risks)
Achieving fair market competition (setting of Group rules, and monitoring of compliance)
Avoidance of corruption, bribery, and anti-competitive behavior

Related SDGs

Related SDGs

From the candidate issues that were extracted
and analyzed using the process outlined
above, we identified the following threepriority issues:

17●

Environment●

Local Communities●

Diversity and inclusion

Yokowo 2023 Integrated ReportMore advanced

business activities and social contribution
GO BEYOND〜Challenge the Next Stage〜
Yokowo 2023 Integrated Report

18

Yokowoʼs Value Creation▼ Materiality targets and progress status
Materiality① Be a company that customers and theircustomers feel comfortable working with

Establish Yokowo as a quality brand by using thehighest quality, and by a move to zero hazardous
chemical substances
Contributions to treatment of illnesses and rarediseases

Response to climate change
Formulating concrete strategies that conform to
TCFD recommendations
Disclosure using the CDP framework
Planning and progress management by the
Board of Directors

Target Value

Number of innovative medical devices createdbacked up by IP (annual)5

Establishment of micro precision and microwave
laboratories

Established

Number of treatments provided to the fieldof rare diseases with low patient numbers andwithout established treatment methods (annual)

3

Achievement Level by FY2022
2 devices under development(specification finalized)
Establishment of Micro Process R&D
Center (new R&D building)
1 treatment under development(prototyping stage)

GHG emissions
Compared to FY2014
Target for 2030

Scope 1 and 2
35% reduction

Introduced photovoltaic power
generating facilities at the Tomioka
Plant and Vietnam Plant, which are theCompanyʼs core plants
Started Scope 3 calculations, andpromoted consideration of specificreduction measures

Water use (basic units)
Target for 2030

10% reduction
compared to FY2020

25.6% reduction compared to FY2020

Waste generation
Target for 2030

10% reduction
compared to FY2020

42.0% increase compared to FY2020

Training participation rate (annual)

0
100%

0
Information security e-learning: 92%
Compliance e-learning: 98%
Anti-bribery e-learning: 86%② Be a company that society(including local communities)
and its business partners feel
comfortable interacting with
③ Be a company where employees and theirfamilies feel comfortable being employedDialog with local communities and contributions
to their development

Number of community service projects undertaken(annual)10

Promoted activities in local communities.
For more details, please see the Local
Communities section (p.50)

Fulfilling social responsibility throughout the
supply chain

Violations of the Subcontracting Law

00

Establishment of a global BCP system, andconstant testing to improve its effectiveness

BCP strategy-based best mix of overseas anddomestic production

BCP certification

Promoted the establishment of a new
business continuity planning (BCP)
system in the Fine Connector business in
the FC/MD segment

Concern for human rig
Building of a check system in cooperation withlocal governments and NPOs to eliminate childlabor and unethically mined resources, etc.

In-house checks, and actively contributing to
the promotion of fair labor practices throughcollaboration with NPOs in each country

NPO cooperation
activities
5 (annual)

Promoted the development of ahuman rights policy. Complying with all
customer human rights status checks andexploring possibilities for collaboration
with NPOs to strengthen our own
internal checking function

Ratio of female leaders (overall ratio of female
employees who are section heads or higher)

Comparable with levels
for males

Male 39.0% Female 8.3%
Currently implementing roundtablediscussions
For more details, please see the
Employees section (p.44)

Create a workplace environment allowing all
employees to play an active role regardless of age

Employment age limit
70 and above

Adopted a framework that enables
persons aged 65 or over to continue
working as contract employees underoutsourcing or consulting agreements

120

Number of TISP hires at the Company 72

150% of legally
stipulated ratio (2.3%)

1.5%
Obtained certification as a special-purpose
subsidiary of YOKOWO FUTURE-ORIENTEDSUPPORT CO., LTD. in March 2023

Promotion and development of workforce
diversity and inclusion

Number of TISP hires
Ratio of employees with disabilities

Achieving an appealing, rewarding work
environment

Expanding long-term training andapprenticeship programs in Japan for employees
in locations overseas thus improving theirabilities, and strengthening the business mindset
of Japanese employees through interaction withthese employees

19

Performance Indicator

Number of major compliance violations (annual)Strengthened compliance and governance

TopicsTargets for 2030

Yokowo 2023 Integrated Report

Percentage of annual paid leave taken

90%

71.5％

Number of on-site company nurseries established３

Preparations are underway as part of the
Tomioka Plant renewal plan. We are also
introducing a GLTD system. We are alsoplanning to introduce a childcare plan.

Number of workplace accidents (annual)

0

2

20

0
Although recruitment at overseas facilities
went ahead as normal, the acceptance ofoverseas long-term trainees in Japan was
put on hold because of the spread of the
COVID-19 pandemic.

Number of overseas long-term trainees
nominating (annual)

Initiatives for Employees̶ Reforming Human Resources System
toward the Next Century
Here at The Yokowo Group, we celebrated the 100th anniversary since ourfounding in September 2022, while at the same time we are embarking on
the next 100 yearsʼ journey.
As one part of our idea to “Be a good company” (see the p.17 “YokowoʼsMateriality”), the Yokowo Group has as our objective to “Be a company
where employees feel comfortable being employed, and which ensures that
employeesʼ families are happy for them to work there.”
In order that employees can feel good about the company, we feel that
as well as their achievements being recognized and them being satisfied
financially, their job satisfaction and sense of growth along with how they areachieving self-fulfillment are also important factors.
On the other hand, this rapidly changing and uncertain future meansthat existing frameworks are no longer as immediately applicable, and thatthe creation of new value is constantly required. And it is our people whowill create this value. This is achieved by each one of our diverse humanresources enhancing their own abilities, and combining them together.
This growth and self-realization of our employees is the source of thiscreation of new value, and an asset to the company. Looking forward, we
will promote a human resources system that can support active employee
growth, and that maximizes these abilities while achieving self-realization
for diverse human resources. At the same time, we will sublimate this intoa system that promotes the provision of opportunities that can lead to thecreation of new value (For specific efforts, see the p.43 “Employees”).

External Engagement Initiatives
̶ Toward External Assessment Responses
in ESG Management
As well as disclosing details of the measures taken to confront climatechange through the Carbon Disclosure Project (CDP) framework, an external
evaluation organization, the Group is aiming for a “B” rating, together withaiming to improve its rating with other ESG evaluation organizations. As one
part of our efforts in fiscal 2022, as well as publishing the Integrated Report,
we also expanded the content on our website and published a collection of
ESG data*. In addition to starting Scope 3 calculations for greenhouse gas
emissions, we will disclose detailed DEI (Diversity, Equity, and Inclusion) data
and update this as needed.
We were able through these initiatives to obtain an FTSE Russel ESG
rating of 3.2 (2.5 in previous year). We still have progress to make, but we are
steadily moving toward better evaluations.
The Group will strive to keep enhancing our corporate value as an evolving,
enduring company that continues to create something new for our customers.
At the same time, we will proactively confront new social issues on a global
level, and looking forward contribute to bringing about a sustainable society.
*Refer to our corporate website for details regarding ESG data collection.
https://www.yokowo.co.jp/english/company/csr/esgdata.html

Yokowo 2023 Integrated Report20

Yokowoʼs Value Creation

Yokowoʼs Manufacturing
The Yokowo Group actively incorporates cutting-edge technologies while reaching greater heights with its coretechnologies, such as micro precision processing technology, antenna technology, and microwave technology,
providing a wide variety of original products for the worldʼs leading companies.
Furthermore, Yokowo is promoting innovation each and every day in the production process and enhancing oursoftware development capabilities in order to evolve our business model from “things” to “services” — this is so that
we can achieve high levels in terms of quality, cost, delivery, and safety (QCDS).

Multi-Layer
Building Products

Basic Research

Vehicle antennas

Fields for Product Roll-Out

Vehicle Antennas
Amid the development of automated driving and 5th generation mobile communications systems (5G),
microwave technology is becoming increasingly more important in the fields of vehicle communicationand semiconductors. Yokowo is progressing with the establishment of the worldʼs highest-level
microwave technology in terms of both wireless communication and semiconductor testing.

Micro Precision
Process

Software applications

In addition to the worldʼs highest-level micro precision
processing technology, Yokowo is strengthening its
competitiveness in precision plating and MEMS processing.
Semiconductor testing

Process
Development

Production
Process

All major elemental technologies are developed within Yokowoʼsproduction engineering department, which also promotes AI
applications in production and quality control.

DesignProcess

Yokowo is establishing an integrated system from design tomaintenance that utilizes 3D computer-assisted design information.

Expanding and Strengthening

Microwave
Technology● Automated driving systems

Semiconductor Testing Tools● 5G● Turnkey

Connectors for Electronic Devices● Small, low prole, waterproof,

high current

Medical Devices● Precision parts● Assembly productsHigh frequency
device testing
Social Platforms

Connectors forelectronic devices

Applied Research● System proposals related to building social platforms that utilize wireless technology and software development

capabilities● Development of high-speed optical communication devices and connectors, and automatic testing technology for

wireless antennas incorporated in semiconductor devices essential for the evolution in automated driving and 5G

Medical devices

Strategic Development

Commercialization
Research

Yokowo has established a system in which the R&D department, the process technology
department and the department responsible for new product development andcommercialization can work together closely. By incorporating cutting-edge technologies
in collaboration with other companies and universities, Yokowo is also promoting productevolution and a multi-layered business structure.

● Car sharing● Drones

High Frequency Device Testing● Amps● Filters

Optical Communications● Connectors● Photoelectric conversion

The worldʼs number one manufacturer for high-frequency,
wireless applications, and precision parts

Cutting-Edge Research and Development

Precision Plating
● Wet

● Dry

● Turnkey system proposals for semiconductor testing tools

21

Yokowo 2023 Integrated Report

Yokowo 2023 Integrated Report

22

Yokowoʼs Value Creation

Research and Development
The Yokowo Group has set the five fields of micro precision processing technology, microwave technology,
antenna technology, surface modification materials technology (surface processing/modification of material), andsemiconductor application technology as the Companyʼs core technologies supporting its competitiveness in themarketplace. Through greater sophistication and wider use of all its technologies, Yokowo is building a multi-layered
business structure to create innovative, high-tech products.

Research and Development
Basic & Applied Research

Product design R&D

R&D Investment

Main R&D Themes

Based on the Yokowo Groupʼs company-wide growth strategy,

Main objectives over the medium to long term include: thethe R&D department, the business divisionʼs technology
department, and local development centers work together topromote research and development centered on the Companyʼscore technologies. In particular, Yokowo is focusing on the
research and development of new technologies and new productswith an emphasis on developing products with a higher degree oftechnological integration and increased added value.

expansion of the MaaS (Mobility as a Service) business modelthat combines a hardware vehicle with software services
including the integration of payment for multiple modes oftransportation in line with the concentration of investment
in CASE (Connectivity/Autonomous/Shared/Electric) nextgeneration technologies and development in CASE. Other
objectives include the actualization of new semiconductor
demand for next-generation high-speed, large capacity
communications typified by 5G and Beyond 5G (6G); the riseof next-generation products such as wearable devices; and the
spread of minimally invasive treatment and advances in genetic
testing technology.
The main R&D themes for each segment related to the above
markets are as follows:Business Development in Growth Fields▼ R&D Expenses

Automotive

Production R&D(million yen)
Microwave
technology

Advanced ProductCreation
Semiconductor
application
technology

Antennatechnology
Wireless
communication
technology

Micro precision
processing
technology

Stable Supply of
Advanced Products
Surfacemodificationmaterials
technology

Social infrastructure(MaaS/ETC)

3,260
Semiconductor
testing

Ceramic devices(joint venture with
Nippon Electric Glass)

5G

Application Development
for New Products

Production Engineering
Research Department

Core Technology
Development H.Q.

Manufacturing
Engineering Research
Department

New Technology &New Business Incubation

2018

2019

2021

CTC

2022

■ Development of test sockets for high-current, high-speed andhigh-frequency devices■ Research and development aimed at improving performance,
durability, and functionality, e.g. probe surface modification
technology■ Development of probe cards that keep pace with thesemiconductor device technology roadmaps(FY)

With its sights set squarely on target business fields and businessdevelopment for intellectual property, Yokowo is strengthening
the foundations of its intellectual property, the cornerstone of its
business strategy, by steadily increasing the number of patents
it holds in Japan and overseas and by making use of licensing
agreements, etc.

Production Process
Innovation H.Q.

(Basic technologies andresearch related to production
process technology)

Innovation Promotion
Division(case)
1,200
1,000

737

658

Development of applications for new products is conducted by engineering departments in each business division, with the Technical H.Q.
overseeing the whole product development process along with technology development. The Management Planning H.Q. and Incubation
Center are in charge of new technology and new business incubation, whereas for research and development, the Core Technology
Development H.Q. is in charge of the development of technologies, such as microwave technology, micro precision processing, and MEMS
technologies, needed to give our products a competitive advantage. Likewise, the Production Process Innovation H.Q. is in charge of
research related to the production of products.

200
0

2018

2019

2020

383

363

349

284

247

2021

【Fine Connector (FC) Business】■ Development of high rated connectors■ Development of optical connectors for high-speed opticalcommunication

670

586

495

453

411

400

1,053

949

844

FC/MD

【Medical Device (MD) Business】■ Joint development of new minimally invasive medical
equipment and testing systems with universities and medical
institutions in Japan and the United States that utilize micro
precision processing technology and microwave technology▼ Patents held

600

Yokowo 2023 Integrated Report

2020

Intellectual Property Rights

800

23

■ Antenna system for V2X essential for ADAS and automateddriving■ Technology development for communication systems,
equipment and devices for the CASE era

Decliningbirthrate
and aging
population

Research and Development System(Business Strategy, M&A)

VCCS

3,405

1,000
0

Policy Product design R&D and production R&D are essential and inseparable elements of Yokowoʼs research and development. With the two
running in sync Yokowo is able to create advanced products at the cutting edge, providing a stable supply to the Companyʼs customers.

Management Planning H.Q.,
Incubation Center

3,201

2,000

Mobile communication
terminals*1 Material evaluation technology and ceramic technology promote evolution through alliance*2 An acronym for the new trend in automobiles: Connectivity, Autonomous, Shared, Electric(Product Development Supervision,
Intellectual Property)

3,592

3,000

Medical devices

Technical H.Q.

4,366

4,000

SoftwarePackagingTechnology

Material
evaluation
technology*1
Ceramic
technology*1

5,000

CASE*22022(FY)

Overseas patents (including actual plans, designs and trademarks)
Domestic patents (including actual plans, designs and trademarks)

Yokowo 2023 Integrated Report24

Yokowoʼs Value Creation

Product Technology
The Yokowo Group develops a whole range of innovative products based on its unique technological capabilities
built up over many years, supplying electronic, electrical and automotive manufacturers around the world.

Innovative Product Development through the Fusion of Yokowoʼs Technologies

Antenna
Technology

Surface Modification
Materials
Technology

Microwave
Technology

Micro Precision
Processing
Technology

Product
Development

Production
Engineering

・MEMS Technology

New Core
Technology

・Ultra Fine Pitch Microwave
Contactor
・Advanced Millimeter-Wave
Module Technology/Measurement
Technology

By combining Yokowoʼs production engineering
for increased production efficiency with its
core technologies of micro precision processing
technology, microwave technology, antenna
technology, and surface modification materials
technology, the Company is able to develop
products with innovation and creativity. Amassing
technical expertise with greater sophistication,
Yokowo remains committed to the fundamental
research and development of new core technologies.
Through these unique technologies, Yokowo
manufactures a whole range of innovative
products such as: vehicle antennas; testing
tools for semiconductors and electronic
components; connectors for electronic devices;and medical devices. Yokowo continues to supply
these products and more to the automotive,
semiconductor testing, mobile communication
terminals and medical device markets.

Technology
Research &Development

Semiconductor Testing Market
More than ever before semiconductors andelectronic components are required to have faster
speeds, higher frequencies, and better integration,with similar expectations also for the testingprocess. By making full use of MEMS technology,
in addition to Yokowoʼs micro precision processing
and microwave technologies developed over many
years, Yokowo develops and supplies products
globally in all areas of high-speed, high-frequency
as well as front- and back-end testing processes.

▼ CTC Segment Business Domain

MEMS Technology

Contact Bumps

Core Connector
Technologies for
Semiconductor
Testing

Micro Precision
Processing
Technology

Ceramic Technology

Microfabricated Parts

Mobile Communication
Terminal Market
In the rapidly expanding mobile communications
terminal market, there is an increasing need for
detachable, low profile space-saving connectors withdetachable durability and environmental worthinessbecoming even more important in commercial
information devices. Yokowoʼs proprietary SPRING
CONNECTOR™ accurately capture these market
needs, becoming used more widely in a variety of
applications.

Evaluation Systems▼ Features and Main Uses of the SPRING CONNECTOR™

4 features

High Reliability

Multimedia

Main Uses

Products Developed

Yokowo 2023 Integrated Report

Mobile phone

Point of Sales

Health equipment

Wireless device

Connected

AM/FM

Navigation

Shark Fin
Antennawithbuilt-incameraHigh
precision
GNSS
Antenna

DigitalBroadcasting

Telematics

Laminated
Antenna

5G/V2X
compatible
Shark Fin
Antenna

Shark Fin Antenna with built-in camera

25

Informationequipment

Medical Device Market
SystemTo meet the needs required for smaller, multi-use,lower profile, smart vehicle antennas, Yokowo isdeveloping antenna systems that support nextgeneration vehicle communication by making fulluse of modular technologies as well as the antenna
and microwave technologies Yokowo has built up
over many years.
Along with Yokowoʼs state-of-the-art facilities,
including an electromagnetic field simulator and an
anechoic chamber for measuring millimeter-wave
frequencies (up to 40GHz) in 5G communications,
Yokowo makes full use of its world-leading
technological prowess to manufacture innovative,
industry-leading products.

High Durability

Automotive
equipment▼ VCCS Segment Business Domain

Space Saving

Design Freedom

Video equipment

Automotive Market

Microwave
Technology

Electronic
Toll Collection/
Dedicated Short
Range
Communications

GNSS/DSRC
HybridAntenna

5G compatible anechoic chamber

Yokowo is making full use of technologies such a
micro precision processing, coating, assembly, as
well as product design and evaluation to develop
such products as OEM guide wires, catheters andother items in the field of minimally invasive medical
equipment. Yokowo possesses its own equipment
and manufacturing lines to provide a complete
service from product processing and finishedproduct assembly to hydrophilic coating, packaging
and sterilization. In the assembly process, various
connections methods can be selected depending on
the productʼs use.

Enlarged Figure of Hydrophilic
Coating

Assembly of Esophageal Temperature Probe

Tip Terminal of Catheter

Radiopaque Marker

Coil for Guide Wire

Yokowo 2023 Integrated Report

26Segment Overview

Yokowoʼs Business Domain

VCCS Segment
VCCS

The Yokowo Group has implemented and refined a number of technologies such as antenna and microwave
technologies, while further deepening the technologies in micro precision processing. We are branching out today
into three segments: VCCS (formerly Vehicle Communication Equipment), CTC (formerly Circuit Testing Connector),and FC/MD (formerly Personal Communication Equipment), and as of FY2023, have added an Incubation Center
segment focusing around the promotion of new businesses.

▼ Business Domain Map

VCCS(formerly Vehicle Communication Equipment)

Sales: ¥46,520 million(+16.1% YOY)
Vehicle Antennas

Shark Fin Antennas

GNSS Antennas

CTC

FC/MD

(formerly Circuit Testing Connector)(formerly Wireless Communication Equipment)

Sales: ¥22,374 million(+26.9% YOY)

Sales: ¥9,067 million(-0.8% YOY)
Connectors forElectronic Devices(Fine Connectors)

Semiconductor
Testing Tools▼ VCCS segment - Consolidated Sales(million yen)

FY2018FY2019FY2020

FY2021

FY2022

38,18339,26437,29240,081

46,520SPRING CONNECTOR™

Hi-Giga-Socket

Segment Policy

In the VCCS (Vehicle Communication Comfort & Safety) segment,
Yokowo manufactures vehicle antennas, including Shark Fin and
GPS antennas for all areas from low to high frequency, mainly in
China, Vietnam, and the Philippines with over 90% of production
taking place overseas. Regarding sales, we mainly provide ourvehicle antennas to Japanese automobile manufacturers, not onlyin Japan but also globally in the United States and ASEAN markets.
Overseas sales account for over 70% of all sales in this segment.
As a leading company of antenna systems that support
next-generation vehicle communications, Yokowo will continue
to strengthen its core technologies including antennas, andpromote drastic reforms to its profit structure to continue togenerate long-term profits.

Looking ahead, Yokowo will continue to approach newmarkets including the rapidly expanding Indian market, using
this as an opportunity to take advantage of major shifts inthe business environment—these include the development of
new business fields such as CASE*, rapid growth in EVs, andreductions in greenhouse gas emissions. While working on
the development of more advanced strategic products withhigher levels of added value, Yokowo will work toward stableprofitability as a business through comprehensive and thoroughreforms in everything from product costs to business structure.
In addition to carefully selecting investment projects aimed
at improving capital efficiency, Yokowo will forge ahead
in rebuilding its profit strategy and creating a multilayered
development and production system by stably expanding laborsaving, automatic assembly lines, moving more production
from its Chinese plant to its plant in Vietnam, rapidly achieving
full production at the Philippines plant as a third production
base (began operations in April 2022), and making the most of
strategic alliances.

Medical
Devices

VCCS

CTC

Coils for Guide Wires
and Catheter Shafts

FC/MD（Vehicle Communication Comfort & Safety）（Circuit Testing Connector）（Fine Connector/Medical Device）

Yokowo manufactures antennas for cars (vehicle
antennas), such as the Shark Fin antenna, mainly
for the automotive market.
By continuing to develop and propose
antenna systems to the customers that support
next-generation vehicle communication whichmeet the basic needs required for smaller,
multi-use, lower profile and smart vehicle
antennas, Yokowo is helping to create safe andcomfortable mobility services.

Yokowo manufactures probe cards for frontend testing and sockets for backend testing
mainly for the semiconductor and electronic
component testing market.
By making full use of its micro precision
processing and microwave technologies, theCompany provides solutions for all processes
in the area of testing for electronic devices,such as semiconductors and electronic
components, so as to meet the demands forsmaller size and greater speeds.

〈Fine Connector (FC) Business〉
Yokowo is globally developing and providing
minute SPRING CONNECTOR™ that meet theneeds for miniaturization and space saving
in various electronic devices, mainly for themobile communications terminal market.

Incubation Center(Segment added in FY2023)

27

Yokowo 2023 Integrated Report〈Medical Device (MD) Business〉
Yokowo provides a complete service from thedesign to the development and manufacturingof OEM guide wires, catheters and othermicro precision parts and assembly products,
mainly for the minimally invasive medical
equipment market.

This segment comprises a Platform Business in response to new markets such asadvanced driver-assistance systems (ADAS), automated driving, and connected cars,
and an Advanced Device Business that promotes the development of high-speedtransmission device products for the optical communication market.

FC/MD

Segment Overview

Segment Review (Fiscal 2022)
Probe Cards

CTC

In the automobile market, the main market for this segment,
the global shortage of semiconductors and the delays in partsprocurement and other impacts persisted in part, but from thesecond quarter onward, the semiconductor shortage graduallyeased, with sales trending upward. A breakdown by region
shows that new vehicle sales decreased year on year in China,
but increased in the US, ASEAN, and Japan markets.
In these circumstances, overseas sales of antennas forautomobile manufacturers such as Yokowoʼs mainstay Shark Fin
and GPS antenna products increased year on year due to theweaker yen and the rebound in automobile production from thesecond quarter onward.
As a result, net sales in this segment grew year on year to￥46,520 million (up 16.1% on previous year). In regard tosegment profit and loss, the segment reported a loss of ¥2,094
million (a loss of ¥1,443 million in the previous year). This was
as a result of cost increases resulting from ongoing higher raw
material prices and ocean freight rates, in addition to higher
raw material and labor costs at production sites in China andVietnam resulting from currency appreciation, and a one-timeinventory write-down resulting from the application of thelower-of-cost-or-market method in the fourth quarter, in spite ofa partial recovery from cost increases.

*CASE: Connectivity / Autonomous / Shared / Electric, new trends in automobiles.

Shark Fin Antennas

GNSS Antennas (supports multiple
satellite positioning systems, including
GPS, GLONASS, and Galileo, etc.)

Yokowo 2023 Integrated Report28Segment Overview

CTC Segment

FC/MD Segment
VCCS▼ CTC Segment - Consolidated Sales

FY20189,138

FY201912,832

FY202013,242In the CTC (Circuit Testing Connector) segment, Yokowo
manufactures contact probes making full use of its micro
precision processing technology, and also manufactures probe
cards for front-end testing and sockets for back-end testingin semiconductor manufacturing processes, both of which
use contact probes. Yokowo has production bases in Japan,
Malaysia, and Vietnam with overseas production accounting forover 60% in this segment. Products are supplied worldwide,
mainly to semiconductor manufacturers and foundries, withover 80% of sales going overseas.
In recent years, Yokowo has expanded its product lineup
in cutting-edge fields, such as testing sockets for testing 5G
devices that use microwave technology, and probe cards forthe testing of high-frequency electronic components (YPX) thatmake use of MEMS technology.

Segment Review (Fiscal 2022)
In the semiconductor testing market, the main market for thissegment, there was strong demand the first half of the year
due to firm demand in servers and automobiles combined withexpanded supply capacity from semiconductor manufacturers
in order to eliminate semiconductor shortages, but this slowed
sharply from the second half onward due to declining demand in
PCs and smartphones.
In these circumstances, sales of semiconductor back-end
testing tools, the main product of the Group, increased year on
year because of higher orders for logic semiconductor testingsockets and depreciation in the yen, despite a decline from thesecond half of the year. Sales of semiconductor front-end testing
tools increased year on year due to the launch of new models
in the turnkey business that offers one-stop solutions services
including peripheral devices, and sales of MEMS probe cards (YPX)
for high-frequency electronics components testing also exceeded
the previous year on the back of increased orders.
As a result, net sales in this segment grew year on year to￥22,374 million (up 26.9% on previous year). In regard tosegment profit and loss, the segment reported a profit of ￥6,169
million (up 26.6% on previous year) due to increased profits

Yokowo 2023 Integrated Report▼ FC/MD Segment - Consolidated Sales(million yen)Segment Overview

29

VCCS

FY2021

FY2022

22,374

17,625CTC

FC/MDfrom higher net sales and the impact of the weaker yen in thefirst half of the year, despite a deterioration in profits due to a
sharp drop in orders in the fourth quarter.

Segment Policy
Going forward, Yokowoʼs policy is to steadily capture theincrease in demand for semiconductor testing in fields suchas 5G, IoT, in-vehicle, and AI. To this end, Yokowo willstrongly promote the strengthening of full-scale systems to;develop and launch strategic products that target the market
for high-frequency and high-speed signal testing related to
5G communications, invest in capacity increases at domesticand Malaysian plants as well as achieve stable operation atdomestic branch plants and the Vietnam plant established in
the second half of fiscal 2022, and invest in improved efficiency
and streamlining such as by building automatic assembly lines
and introducing automatic testing systems. Further, as wellas promoting fundamental structural maintenance toward
expanding our turnkey business in the area of semiconductor
front-end testing and strengthening our production and business
continuity planning (BCP) systems in anticipation of a recovery of
demand in the semiconductor testing market, Yokowo will also
strive to build a more profitable business structure and maintainstable business operations.

Contact
ProbesYPXProbe Head

Sockets(million yen)

FY2018FY2019FY2020

FY2021

FY2022

7,429

8,498

9,441

9,141

9,067

Segment Overview
This segment consists of two businesses; FC (Fine Connector)
and MD (Medical Device).
In the FC business, Yokowo manufactures SPRING
CONNECTOR™ which allow for easy attachment anddetachment to electronic devices. These connectors are
manufactured in Japan, Malaysia, and China, with over 80%
being produced overseas. Yokowo supplies a wide range ofelectronic device manufacturers in Japan and overseas, with over
80% of sales going outside Japan.
In the MD business, in addition to micro precision parts suchas OEM guide wires and catheters, Yokowo designs, develops,
and manufactures assembly products at its Tomioka plantin Japan. Yokowo mainly supplies domestic medical device
manufacturers, with approximately 10% of sales going overseas.

Segment Review (Fiscal 2022)
In the market for mobile communication terminals, a main market
for this segment, sales of smartphones were sluggish due to theimpact of the global shortage of semiconductors and of a business
downturn. However, sales of wearable terminals are expected
to grow given their diversification and greater sophistication.
The POS terminal market has been growing steadily in a wide
range of industries, including those engaging in logistics andmanufacturing, with a view toward improvements in operational
efficiency through information management, however demand issoftening due to the global economic slowdown.
In these circumstances, net sales for the FC business, for whichfine SPRING CONNECTOR™ act as core products decreased year
on year due to lower sales in wearable devices such as wirelessearbuds because of customers production adjustments, along witha decrease in orders for POS terminals.
In the MD business, which is included in the segment, sales
increased year on year, reflecting sales of products to major
customers.
As a result, net sales in this segment decreased year on yearto ￥9,067 million (down 0.8% on the previous year). In regard
to segment profit and loss, in addition to a drop in profits fromreduced income in the FC business, an increase in the labor-

CTC

FC/MD

cost ratio at production bases in China caused in part by theappreciation of the Chinese yuan together with changes in thebusiness composition meant that profit decreased to ￥664 million(down 47.1% on previous year).

Segment Policy
In the FC business, Yokowo aims to establish a competitive
advantage by honing our core competencies, and to evolve into
a connectors solution provider by creating new customer value
through leveraging our unique strengths as a company. The
Group will redefine the wide variety of markets, and provide anadvanced user experience (UX) by using product planning andsales strategies tailored to our target markets.
In the MD business, Yokowo aims to further grow thebusiness by increasing the production capacity of micro precisionparts with the installation of cutting-edge production equipment
and by expanding sales of guide wire and catheter assembly
products in Japan and overseas, and by shifting over to a global
quality control system covering the entire product life-cycle.
Yokowo will strengthen our efforts in the venture ecosystem
as a manufacturing partner that brings product ideas fromventure companies in Japan to reality, and as a planning productdevelopment and development-type OEM supplier in theadvanced medical field, will achieve active business expansion.

SPRING CONNECTOR™

Coils for guide wires

Yokowo 2023 Integrated Report30

Sustainability

Sustainability Promotion Framework

Stakeholder Engagement

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

At the Yokowo Group, our purpose is based upon a commitment to make Yokowo a good company by employing
people and technologies that work for the benefit of society today and tomorrow. We are also communicating withall our stakeholders including our customers, local communities, business partners, employees and their families,
shareholders, and investors to envision a better and more prosperous future, and we aim to become an evolving,
enduring company that continues to create something new.

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

Themes handled by the Sustainability
Committee, and Outline
Theme

OutlineEnvironment

Deliberation, planning, and progress
management of measures towards achieving
the targets of the Group GHG emissions
reduction, water resources, waste recycling,
and biodiversity, and monitoring of chemical
substance management status in accordancewith laws and regulations in each country

Human Rights
Protections

Deliberation and progress management forthe protection of human rights in the Groupʼs
supply chain

Local Communities

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

Diversity andInclusion

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

Opinions anddecisions on reports

Sustainability Committee
Chairperson
President and Executive Ofﬁcer
Secretariat

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

Information Security(Audit & Supervisory Board
Member, Outside Director)

Occupational Healthand Safety

Treatment of
Employees

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

Fair Trade

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

Risk Management

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

Business Continuity
Planning (BCP)

Collaboration with each business division
regarding construction of BCP and its updates

Role of Sustainability Committee
1. To prepare and review draft sustainability policies andmateriality policies in light of factors such as the Group
Corporate Philosophy structure and business environment.
(Decisions are made by the Board of Directors)
2. To receive reports from relevant internal organizations onmateriality and ESG-related themes, and to report and assist
in reporting to the Board of Directors.
3. To disseminate information accumulated from the cycleof “report to Board of Directors → disseminate opinions
and suggestions from the Board of Directors to relatedorganizations → further improve initiatives” in 2 above, alongwith decisions made by the Board of Directors.

31

Yokowo 2023 Integrated Report

Customers

Concepts and Vision
The Yokowo Group has as our objective to “Be acompany that customers and their customers feel
comfortable working with.”
To achieve this, as well as establishing the“Yokowo Quality Brand” focusing on the highest
quality and on zero hazardous chemical substances,
Yokowo is making proposals from the planningstage keeping in mind the development of productsthat meet customer needs, always striving tounderstand their requests, and working to build
long-term relationships of trust with customers.

Local
Communities

The Yokowo Group has as our objective to“Be a company that local communities feel
comfortable interacting with,” and to this end,
we feel it important to promote dialogue withlocal communities, as well as to contribute to theirdevelopment.
Our aim is to build relationships of trust withmembers of local communities while helping themunderstand our business and initiatives throughactivities that support their development, andinitiatives that contribute to solving societal issues.

Business Partners

The Yokowo Group has as our objective to“Be a company that our business partners feel
comfortable interacting with,” and to this end we
ensure fair and equitable transactions with our
suppliers. We are focused on building relationships
with business partners as an equal partner, abide by
all relevant laws and regulations, and are building
trust relationships based around social ethics. We
are also promoting corporate activities that take into
consideration human rights and the environment.

Collaboration with the Information Security
Committee regarding information security
activities based upon ISO27001
Collaboration with the Health and Safety
Promotion Committee regarding occupational
health and safety activities based upon
ISO45001

ObserverStakeholder

Employees andtheir families

The Yokowo Group has as our objective to “Be acompany where employees feel comfortable being
employed, and which ensures that employeesʼ
families are happy for them to work there.”To this end, we are striving to respect individuality,
engage in fair and equitable treatment, and create an
appealing, rewarding work environment under ourbasic policy of promoting DEI*. Aimed at fostering aculture in which each and every employee can feelcontent in their day-to-day work and continue togrow, we are working on a range of environmental
improvements and initiatives.

Shareholders andInvestors

The Yokowo Group discloses information
accurately, promptly, and proactively in orderto build long-term relationships of trust with its
shareholders and investors and other stakeholders.
The Group is also conducting active, constructive
dialogues with shareholders and investors in orderto achieve continuous growth and to improve
corporate value over the medium to long term.

Main Methods and Opportunities● Daily sales activities

Department
Responsible

Sales H.Q.
Each Business Division● Product exhibitions● Website● Dialogue with local governments, local

residents, NPOs, and others in the areas
where our plants and offices are located● Participation in, and sponsorship ofcommunity events● Community volunteer activities by
employees● Cooperation with, and support for local
educational institutions

General Affairs
Department● Daily purchasing activities● Presentations on chemical substances

contained in products● Environmental assessment that includes

constituent analysis of supplied items

Purchasing H.Q.
Quality Assurance H.Q.

● Questionnaires for customers, and visits● Measures towards quality improvements● Implement employee engagement● Employee training (training by position,

education in philosophy, etc.)● Holding of employee exchange meetings(product engineering, productionengineering, QC)● Internal portal site, in-house newsletters● Internal reporting system and hotline

Personnel
Department
Public Relations &Equity Department
Each Engineering
Department● Shareholder meetings● Financial results briefings for securities

analysts and investors● Meetings with Japanese and overseas

Public Relations &Equity Department

securities analysts and investors● Website (IR, investor relations)*DEI: Diversity, Equity, and Inclusion

Yokowo 2023 Integrated Report32

ESG Report

Corporate Governance

Audit & Supervisory Board

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

Corporate Governance System

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

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

January 2023: Deliberated and decided upon a draft proposal

In addition to one full-time internal Audit & Supervisory Board

regarding the executive structure (directors, auditors,

Member with sufficient knowledge in finance and accounting,and executive officers) and the establishment of thethe Company has appointed three highly independent outside
Audit & Supervisory Board Members to further strengthen the
management audit function, and these include a female outside
Audit & Supervisory Board Members.

Yokowo Scholarship Foundation for the fiscal year
ending March 31, 2024.

Executive Officers
By adopting the Executive Officer system, the strategic decisionmaking and operational supervisory functions are clearly
separate from the executive function, in order to create a systemfor prompt and appropriate execution of operations. In addition
to four internal directors, the Company has appointed elevenexecutive officers in the positions of Chief Officer, General
Manager, and General Manager at Tomioka plant, etc.

February 2023: Conducted interviews with candidates for outside
directors.
April 2023: Deliberated and decided upon draft proposals regarding
the payment of bonuses to executive directors andexecutive officers for the fiscal year ended March 31,
2023, and regarding compensation for the fiscal year
ending March 31, 2024. Drew up succession plan anddeliberated on developing human resources.
August 2023: Deliberated and decided upon draft proposals
regarding changes to the executive officer system,and deliberated the succession plan.

Board of Directors
To speed up the decision-making process, the Board of
Directors consists of only a limited number of directors (a totalof seven—four internal and three outside directors) (as of end
June 2023). The Company has appointed three independent
outside directors (with a high level of independence) to further
strengthen the management supervisory function, and theseinclude a female outside director.

▼ Corporate Governance System (As of April 1, 2023)

Elect

Board of Directors outside
Consultation
SuperviseElect
Cooperate

Audit

Audit & Supervisory Board

Independent Auditors

Management/Supervision

Reporting

Nomination andCompensation
Advisory Committee

Cooperate

Measures to Enhance Auditing andSupervisory Functions

Nomination and Compensation Advisory Committee

As well as sharing information and exchanging ideas in advanceof the Board of Directorsʼ agenda, the Companyʼs outside
directors share matters of deliberation and reports from the
Audit & Supervisory Board to the extent necessary. Full-time
internal auditors ensure compliance and appropriateness byattending important monthly meetings to regularly monitor
how business is conducted. For the fiscal year ended March 31
2023, we conducted site audits of three domestic subsidiaries,
and of seven overseas subsidiaries in the United States, Vietnam,
and Malaysia, and audits based on unique management
environments of local facilities and on country-specific risks.

The Company established the Nomination and Compensation
Advisory Committee as an advisory body for the Board of
Directors, with the aim of enhancing the transparency of thedecision-making process for matters relating to corporate
governance, such as directorsʼ nomination and compensation.
The Committee has three members, composed of theCompanyʼs two independent outside directors Ms. Kuniko
Muramatsu and Mr. Makoto Tobari, and the Representative

General Meeting of Shareholders
Elect

Initiatives to Improve Governance

Audit

Audit

Business Execution
President and Executive Officer

Director, President and Executive Officer Mr. Takayuki Tokuma, with
Ms. Kuniko Muramatsu serving as chairperson. The Committee
receives requests for consultation from the Board of Directors,
deliberates and decides on proposals, and then submits reporssts
to the Board of Directors. The rules governing the operation of theBoard of Directors specify that, in its decision-making, the Board
must respect the content of the reports received from theCommittee to the utmost possible extent.
A summary of the meetings held from April 2022 throughAugust 2023 and the main agenda items are as follows.

Business Risk Management Committee

April 2022: Deliberated and decided upon a draft proposal
regarding the payment of bonuses to executive
directors and executive officers for the fiscal year
ended March 31, 2022.

Internal Audit Dept.

Management Planning H.Q.
Administration
Management H.Q.

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

June 2022: C hairperson appointed under the new committee
structure (Ms. Kuniko Muramatsu reappointed).

Sales H.Q.
Technical H.Q.

VCCS
Business Div.

CTC
FC
MD
Business Div. Business Div. Business Div.

Incubation
CenterCore Technology Development H.Q.
Production Process Innovation H.Q.

Functional
Organization

Business Risk Management Committee
The Company has established the Business Risk Management
Committee as an organization under the direct control of the
President. Its aim is to strengthen the Companyʼs competitivenessand ability to manage risk, such as by forming alliances throughjoint ventures, mergers and acquisitions to further advancebusiness, and by verifying the profitability of large-scale investments.
In addition to regular reports to the Board of Directors, theCommittee conducts activities in close cooperation with theoutside directors.
This was conducted seven times in the fiscal year ended
March 31 2023, to verify the profitability of large-scale
investment projects such as automation facilities, and to
conduct follow-up on alliance projects.

September 2022: Discussed the direction of the Board of
Directors and operational methods.

Purchasing H.Q.
Quality Assurance H.Q.

Business Organization

33

Yokowo 2023 Integrated Report

Yokowo 2023 Integrated Report34

ESG Report

Analysis and Evaluation of theEffectiveness of the Board of Directors
Since 2016 Yokowo has been conducting self-evaluation
surveys and, when necessary, interviews with all its directors andauditors, collecting the results and analyzing them.
This year (2023), the survey was conducted in May, and items
classed as either favorable or issues/requests were as follows.
<Favorable>■ The Board of Directors has atmosphere that actively listens
to the opinions of outside directors, and that emphasizes
active discussions.
<Issues/requests>■ The Company should ensure more diversity in the compositionof the Board of Directors in terms of gender, nationality, age,and other backgrounds.
■ The Company should ensure a sufficient number of independent
outside directors who are qualified to contribute to enhancing
corporate value over the medium to long term.
■ Agenda items have increased at Board of Directors meetings,
but require more in-depth discussion.
In general, the effectiveness of the Companyʼs Board of Directors
was determined to be sufficient, but we will work to further
improve effectiveness by addressing issues, including those above.

Director and Executive Officer
Compensation
Policy on Determining Director and Executive
Officer Compensation
With regards to compensation for the directors of the Company,
an upper limit for the total compensation in each fiscal year is set
by resolution at the General Meeting of Shareholders.
Compensation for individual directors is then determined bya process whereby the Nomination and Compensation Advisory
Committee receives a request for consultation from the Boardof Directors, and then deliberates and decides on proposals
regarding the amount to be paid to individual directors before
reporting to the Board of Directors, which then makes the
final decision, while respecting the reports received from theCommittee to the utmost possible extent.
In the same way, with regards to compensation for the35

Yokowo 2023 Integrated Report

auditors, an upper limit for the total compensation in each fiscal
year is set by resolution at the General Meeting of Shareholders.
Individual compensation is then determined within the boundsof the upper limit through consultation with auditors.

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

comprises monthly compensation in monetary terms.
The amount of basic compensation is determined by discussion
among the auditors at the Audit & Supervisory Board meetingtaking into consideration the roles and responsibilities of each
auditor and based on guidelines stipulated in advance.
In the event of bonuses to auditors, these are paid after gaining
approval at the General Meeting of Shareholders.

draws up a proposal regarding the amount of stock options tobe granted to each individual executive director based on theroles and results of each individual executive director, within theupper limit (in terms of the value of shares or number of shares)
set by the Shareholders Meeting. A request for consultation
is submitted to the Nomination and Compensation Advisory
Committee, and then reported to the Board of Directors, which
deliberates on the matter and makes the final decision.
As a general rule, internal directors are obliged to contributea certain amount or more of their basic compensation to the
Executive Shareholdersʼ Association every month as stipulated
by internal rules. Yokowo shares accumulated by the Executive
Shareholdersʼ Association shall be transferred under the nameof the individual executive directors every six months (in late
September and late March).
In principle, Directors shall hold their shares and not sell themwhile holding their position of director.
Regarding the ratio of executive directorsʼ overall compensation to
be held by each category of compensation, this shall be determinedbased on the roles and responsibilities of each executive director andon trends in compensation at other companies with a similar scale ofoperation to Yokowo. In the case where stock options are granted up
to the specified upper limit, the target ratios for each of the categories
of compensation are: basic compensation: 60%; performance-linked
compensation:20%; compensation in the form of shares: 20%.

▼ Compensation Figures（FY2022）(million yen)

Total amount of remuneration by type
Basiccompensation
Directors(outside)
Auditors(outside)
Total(outside)

Executive
bonus

194
（18）
42
（21）
237
（39）

Compensationin the form ofshares

―
（―）
―
（―）
―
（―）

14
（―）
―
（―）
14
（―）

Total

Upper Limit(annual)

209
（18）
42
（21）
252
（39）

280
（40）
60

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

Compensation for Auditors
Compensation for auditors is limited to basic compensation, which▼ Company Officers Skill Matrix

Specialist Expertise and Experience
Legal affairs
and riskmanagement

Name

Position

Corporate
management

ESG andsustainability

Takayuki Tokuma

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

〇

〇

〇

〇

〇

〇

〇

〇

Koichi Fukagawa
Kenji Yokoo
Naohito Odani

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

Outside Director

Human
resources andlabor affairs

〇

〇

〇

〇

〇

〇

〇
〇
〇
〇
〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇
〇

〇

〇

〇

TechnologicalInternationality
strategy〇〇

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

Finance and
M&A

〇
〇

〇

Yokowo 2023 Integrated Report36

ESG Report

Directors, Auditors and Executive Officers(As of June 28, 2023)

Audit & Supervisory
Board Members

Board of Directors

Takayuki
TokumaKoichi
Fukagawa

Kenji
Yokoo

Naohito
Odani

Kenji
KamachiToshiakiTochigi

Representative Director,
President and Executive
Officer

Director,
Senior Managing
Executive Officer

Director,
Managing Executive
Officer

Director,
Managing Executive
Officer

Audit & Supervisory
Board Member

Outside Audit &Supervisory Board
MemberAttendance rate at
Board of Directors
Meetings:
17/17 times (100％)
Number of Company
shares held:
290,038 shares

Attendance rate at
Board of Directors
Meetings:
17/17 times (100%)
Number of Company
shares held:
52,948 shares

Attendance rate at
Board of Directors
Meetings:
17/17 times (100%)
Number of Company
shares held:
91,869 shares

Attendance rate at
Board of Directors
Meetings:
12/13 times (92%)
Number of Company
shares held:
8,841 shares

KunikoMuramatsu

MakotoTobari

Outside Director

Outside Director

Attendance rate at
Board of Directors
Meetings:
16/17 times (94%)
Number of Company
shares held:
0 shares

Attendance rate at
Board of Directors
Meetings:
13/13 times (100%)
Number of Company
shares held:
0 sharesByeongwoo
Kang
Outside Director
Attendance rate at
Board of Directors
Meetings:－ (New appointment)
Number of Company
shares held:
0 shares

Attendance rate at
Board of Directors
Meetings:
13/13 times (100%)
Attendance rate at
Audit & Supervisory
Board Meetings:
13/13 times (100%)
Number of Company
shares held:
2,383 shares

Attendance rate at
Board of Directors
Meetings:
17/17 times (100%)
Attendance rate at
Audit & Supervisory
Board Meetings:
17/17 times (100%)
Number of Company
shares held:
0 sharesEmi
YonedaOutside Audit &Supervisory Board
MemberOutside Audit &Supervisory Board
MemberAttendance rate at
Board of Directors
Meetings:
13/13 times (100%)
Attendance rate at
Audit & Supervisory
Board Meetings:
13/13 times (100%)
Number of Company
shares held:
0 shares

Attendance rate at
Board of Directors
Meetings:
13/13 times (100%)
Attendance rate at
Audit & Supervisory
Board Meetings:
13/13 times (100%)
Number of Company
shares held:
0 shares

Executive Officers
President and Executive Officer
Senior Managing Executive Officer

Executive Officer cum Deputy General Manager,
Technical H.Q., cum General Manager, VCCS Engineering
Management Division cum General Manager,
Human Resource Development Center

Koichi Fukagawa

Tsuyoshi Sakata

Managing Executive Officer cum General Manager,
Incubation Center

Executive Officer cum General Manager, Advanced Devices
Business Promotion Division, Incubation Center

Takayuki Tokuma

Kenji Yokoo

Motoaki Matsuura

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

Executive Officer cum General Manager,
CTC Business Division

Managing Executive Officer cum General Manager,
VCCS Overseas Plant

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

Managing Executive Officer cum General Manager,
Tomioka Plant

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

Naohito Odani

Katsuhei Yanagisawa
Mitsuaki Okazaki

Naoki Kawata

Tatsuo Tsunoda

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

Approaches to Compliance

Initiatives to Improve Risk Management

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

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

Initiatives to Improve ComplianceTo ensure compliance, the Yokowo Group works to firmly establish
the CSR Code of Conduct (available in Japanese, English, andChinese), which sets out the actions to be taken by the Groupʼsofficers and employees. We are working in order that they are fully
aware of this Code, and that this is well established.
Furthermore, in April 2023 we established the Yokowo Group
Human Rights Policy, and in August of the same year revised the
CSR Code of Conduct in accordance with the Responsible Business
Alliance (RBA) code of conduct.
Additionally, to further raise awareness of compliance, we areconducting compliance-related e-learning programs for officers
and employees at our Group and at subsidiaries in Japan, and arealso conducting e-learning for overseas subsidiaries as well on theprevention of global bribery and corruption. We have also put inplace a whistleblowing system as well as an external hotline topromptly detect and correct any violations of laws and regulations.
Furthermore, under the CSR Code of Conduct, we have establishedand started utilization of regulations compliant with anti-bribery
regulations in each country. The Internal Audit Department also
audits business processes in each department at Yokowo and at
subsidiaries in Japan and overseas, providing guidance on detecting
and preventing misconduct and improving processes.
In FY2022, there were no compliance violations.

Executive Officer cum General Manager,
MD Business Division▼ Schematic diagram showing the internal whistleblowing system
Contact points for reports andrequests for consultation

External consultation window

Responsible department within
the Company

Demonstrating concern for
the feelings of the reporting party

Clarifying the reporting
party’s intent

Collating the issues
Support for exploring solutions

Investigations and interviews

Consultation
with external
experts

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

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

Where theReporting party
wishes to havethe matterhandled by theCompany

Resolving the issue

Hisao
TsunodaCompliance and Risk Management

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

Reoccurrence prevention
and follow-up

Koichi Tachikawa

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

Toshihisa Tagaya

Executive Officer cum General Manager,
VCCS Business Division

Syunichi Nagaoka

Executive Officer cum Chief Officer,
Production Process Innovation H.Q.

Takeshi Akao

Tomohisa Hoshino

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

* For details regarding the reasons for appointment of individual Directors and Audit & Supervisory Board Members, please visit our official corporate website.
https://www.yokowo.co.jp/english/company/csr/governance.html

37

Yokowo 2023 Integrated Report

Yokowo 2023 Integrated Report38

ESG Report

Information Security

Environment

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

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

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

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

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

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

Enacted: April 1, 2013

* The full text of the Information Security Policy can be viewed on the
Yokowo website.
https://www.yokowo.co.jp/english/company/csr/security.html▼ Information Security Management Framework▼ ISO 27001 Certification Status
2014

YOKOWO CO., LTD., 3 Japanese subsidiaries

2016

Chinese subsidiaries (3 locations)

2017

Malaysia subsidiary

2021

German and Vietnamese subsidiaries

Chief Information Security Officer, as CISO
Chairman, Information Security Committee

Information Security Officer
Secretary General, Information Security Committee

Information Security Manager
General Managers, Chief Officers,
Managing Directors

Information Security Administrator
Assigned by General Managers, Chief Officers,
Managing Directors
By Business Div., Headquarters, Department, Section

Information Security Committee Office
Assigned by CISO

Yokowo CSIRT
Assigned by CSIO
Assigned by all companies

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

39

Yokowo 2023 Integrated Report

Protection of Confidential Information
Under its Information Security Policy, the Group has establishedconfidentiality rules for the protection of confidential
information, and disseminated these to the Group and all
suppliers, etc. engaged in Yokowoʼs business. Throughcompliance with these rules, the Group handles and protects,
both strictly and appropriately, all information assets possessedby Yokowo, and information disclosed to it by its customers. In
addition, it is our social responsibility to promote cyber security
measures not only within our group but throughout the supply
chain as a whole, and as such we are working to confirm andenhance the status of security measures at our suppliers andsub-suppliers. As of April 2022, Yokowo has decided to prohibit
the use of password-protected compressed files. In FY2022,
there were no specific complaints regarding either violations ofcustomer privacy, or losses of customer data.

Approaches to the Environment
Environmental Policy

Action Guidelines

Today, when Japan and the rest of theworld are starting to make a serious
effort to realize carbon neutrality by
2050, Yokowo is also responding to
the demands of our stakeholders andsociety by formulating more concretemeasures to address climate change,
and working actively to implement
them. Reflecting this stance, we support
the recommendations of The Task Forceon Climate-related Financial Disclosures(TCFD), and we are implementing
specific initiatives to achieve the targetof reducing greenhouse gas emissions
from our plants (Scope 1 and 2) by
35% by FY2030, compared to FY2014,
and promote specific climate-related
information disclosure.
Yokowo is also committed to helping
to create a rich natural environment.
We seek to do this through ourenvironmental management systemand through activities designed toachieve continuous improvements inenvironmental performance. As partof our commitment, we take into
consideration the environmental impactof our business activities and comply
with all relevant environmental laws,
regulations, and guidelines, as well aswith each customerʼs specific guidelines.

1. Yokowo supports the TCFD recommendations, and besides
formulating and implementing concrete measures to achieve thetarget of reducing greenhouse gas emissions at our plants (Scope
1 and 2) by 35% by FY2030, compared to FY2014, we will also
be disclosing details of the measures taken, through the Carbon
Disclosure Project (CDP) framework.
2. Yokowo will continuously and actively promote energy saving,
resource conservation, and recycling to contribute to theprotection of the global environment.
3. In respect of chemical substances which are harmful to boththe environment and human body, Yokowo will prevent
environmental pollution by implementing preventive measuresand action plan, which include those for the case of abnormal andemergency operation, and will minimize the use of hazardous
chemical substances.
4. Yokowo will comply with all relevant environmental laws,
regulations, and each customerʼs specific requirements, and intend
to enhance our environmental management by our original
internal standards.
5. Yokowo will set objectives and goals for our environmental
activities and also improve our environmental management system
continuously by periodically reviewing the objectives and goals.
6. Through in-house education and publicity, Yokowo will promote
all the employeesʼ recognition of involvement in environmental
preservation and will make these activities take root as daily duties.
7. Yokowo ensures that all the employees including those ofaffiliated companies are fully aware of the environmental policies,
and will disclose them to the public on request.
8. Yokowo will contribute to the development of a sustainable society
by considering the impact on biodiversity in all its business activities.
Enacted: June 1, 2005 Revised: October 15, 2021

Environmental Management Systems

Issues and Results of Activities

ISO 14001 Certification

The Yokowo Group identified four issues that need effort —addressing climate change, management of water resources,
resource recycling, and zero hazardous chemical substances
usage.For these issues, Yokowo sets annual goals and activities
to be achieved.
At a meeting of the Board of Directors held in October 2021,
Yokowo decided to express its support for the recommendationsof the TCFD, made revisions to the Action Guidelines, anddisclosed the status of these efforts through CDP.

Since its individual production bases received ISO 14001
certification starting in 1998, the Yokowo Group has continued
with its work in environmental activities. Furthermore, theEnvironmental Management Committee at each plant has
been central in setting objectives and targets, and in promoting
initiatives in all workplaces aimed at achieving these.
* Please see our website for more details on the status of ISO14001
Certification Acquisitions.
https://www.yokowo.co.jp/english/company/csr/environment.html

Yokowo 2023 Integrated Report40

ESG Report

Targets
Responses toclimate change

Reduce greenhouse gas (GHG) emissions(Scope 1 and 2) by 35% by FY2030
compared to FY2014, aimed at realizing
carbon neutrality by 2050

Water resource
management

Reduce water consumption by 1% fromthe previous year

Waste reduction &recycling

Reduce waste emissions from businessactivities, and achieve a recycling rate of
80% or above

Chemical substancemanagement &pollution prevention

Promote zero hazardous chemical
substances usage for those chemicals thathave a harmful effect on the environmentand human health▼ GHG emissions (including Scope 3*3)

Waste reduction & recycling

GHG emissions (t-CO2) *The Yokowo Groupʼs main products are electronic components,
and the main types of waste that we generate are metal andplastic waste, and waste cutting oil, that are generated during the
production processes. With regard to these main types of waste,
we are working to conserve resources. As well as promoting a
reduction in the quantities of waste generated by our businessactivities, we have also set a recycling rate of at least 80% as atarget. The inclusion of Yokowo Vietnam in the data aggregationfrom FY2020 onwards has led to an increase in the recycling rate.

1300,000
200,000
100,000

Addressing Climate ChangeWith the aim of reducing direct greenhouse gas emissions(Scope 1 and 2), Yokowo is implementing plans for the adoptionof renewable energy at our plants in Japan (in Tomioka City,
Gunma Prefecture), China, Vietnam, and Malaysia, which are ourCompanyʼs main sources of greenhouse gas emissions. In October
2022, we installed a photovoltaic power generation system at ourVietnam Plant using a bilateral credit system, and in June 2023,
we installed the second solar panel system at our new Micro
Process R&D Center at our main plant—the Tomioka plant (Gunma
Prefecture). Furthermore, as another initiative, we have introduced
solar-powered electric vehicle charging facilities at the Tomioka
Plant for the use company cars as well as commutersʼ and visitorsʼ
cars, and are implementing a plan to switch to commuting bytrain, by attracting the placement of a railway station.
As of 2020, the Yokowo Group had implemented a varietyof activities directed towards meeting the goal of a year-on-year
1% reduction in the greenhouse gas (GHG) emission factor,
however we revised these targets in 2021.

20,3710

20,00015,00020,371

0.372

0.334

0.4

0.334

0.280

10,000

0.2
0.1

0

0.0

2018

2019

2020

Yokowo 2023 Integrated Report

2021

2022
(FY)

Emission factor

87.1

1,600
1,400

1,150

1,250

344,632

8
7

5.687

6

4.722

6.134

3.892

283,178

287,500
275,000

3.513

273,845
260,179

262,5002018■ Water usage

2019

85.2

1,500

90
70.5

1,430

80
70

1,056

60
50

59.4

40
30

400

20

200
0

10
2018
■ Waste2019
2020
Recycling rate

The Group is taking the following actions as regards chemical
substances contained in its products.

Support for REACH regulations*6
Recycling rate (%)*5600

Usage rate (water usage / sales)*4

335,868

53.8

Handling of chemical substances
contained in products

2021

2022

0

(FY)

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

In order to comply with the obligation to communicate
information regarding substances of very high concern (SVHC)*7
and the content of regulations regarding restricted substances,
the Group obtains and manages information concerning chemical
substances obtained through our suppliers.
*6 European Union (EU) regulations on the registration, evaluation,authorization and restriction of chemicals*7 Chemical substances stipulated as requiring authorization and registration
under the REACH regulations

Compliance with RoHS directives*8
We check for RoHS compliance of all delivered parts and materials,
and are establishing an internal inspection system.
*8 Directives relating to restrictions on usage of hazardous substances in electricaland electronic equipment

Chemical substance management &pollution prevention

Water usage (m3)250,000

5,000

Total GHG emissions（■Scope1 ■Scope2）

41

0.3

0.316

Waste (t)800

▼ Water usage and usage rates

300,000

20,007(FY)

Of the water used within the Yokowo Group, the majority is fordomestic-type uses; because of the characteristics of our products,
hardly any water is used in the production processes. We areworking to achieve our goal of a year-on-year 1% reduction inwater consumption, measured by per unit of sales.
Additionally, we are monitoring the quality of plant wastewaterusing our internal standards, which are more rigorous thanlegal requirements. At the Tomioka plant, we are recovering all
hazardous chemical substances in discharge from our galvanization
processes, and have achieved zero emissions into public waterways.

0.5

20,222

2022

Management of Water Resources

312,500

21,853

2018
2019
2020
2021
Total GHG emissions（■Scope1・2 ■Scope3）

1,000

Emission factor (CO2 emissions/sales value)*2

21,10430,001

1,200

325,000

25,00020,007▼ Quantity of waste and recycling rate

337,500▼ GHG emissions and emission factor

20,222*1 Electricity CO2 conversion factor is calculated using the following:
Domestic: TEPCO Energy Partner, Inc Basic Emission Factor
Overseas: Until 2021, IEA Official Factor, 2022 uses the market coefficient*2 Emission factor: GHG emissions per million yen of sales*3 From FY2022, we started detailed Scope3 calculations.

350,000

GHG emissions (t-CO2)*1

380,456

400,000

Through these initiatives, we are establishing preventive
measures and response plans, including those for abnormal
or emergency situations. Additionally, we are preventing
environmental pollution, and promoting zero hazardous chemical
substances usage for those chemicals that have a harmful effecton the environment and human health.

2020
Usage rate

2021

*4 Emission factor: Water usage per million yen of sales

5
4
3
2
1

2022
(FY)

0

In the Yokowo Group, the Environmental Action Guidelines
include compliance with relevant environmental laws andregulations, as well as with each customerʼs specific guidelines.
Based on the above, we have established chemical substancemanagement standards (below: “Standards”), are clarifying
management targets for products manufactured and sold by
the Group as well as for chemical substances contained in
products, parts, and materials, and are ensuring that these are
well known within the Group and by business partners, andworking to improve environmental quality. The Standards specify
management methods for chemical substances right fromreceipt of raw materials and parts through to shipment.
We also place an emphasis on sharing information with
suppliers regarding the constituent components used in our
products. As well as conducting rigorous checks of these using
ICP analyzers and fluorescent X-ray spectrometer, we provide
products that meet the changing chemical substance regulatory
requirements of worldwide automobile and electronics
manufacturers.

Measurement of components (energy dispersive fluorescent X-ray spectrometer)

TopicsIn July 2023, we received third-party certification(scope 1 and 2) for greenhouse gas emissions.
In the future, we will further expand coverageof our understanding GHG emissions, including
Scope 3 emissions, and strive to further enhance
information disclosure.

Yokowo 2023 Integrated Report

42

ESG Report

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

Further reforms to human resources system
to encourage proactive employee growth

Basic Data on Employees▼ Number of Employees
Yokowo total
Total employees (persons)＊1

Breakdown bybusiness segment

Europe andthe U.S.

Japan

Asia

8,304

1,504

79

6,721

VCCS

6,087

264

53

5,770

CTC

961

406

14

541

FC

406

78

10

318

MD

300

299

1

0

Other employees

550

457

1

92

*1 Includes temporary staff

Performance Evaluation

In 1998, given external factors such as Japanʼs aging society
and declining birthrate as well as advancing globalization,
we reformed our personnel system, replacing the former job
qualification system with a role-based pay system for managers,
and a job-grade system for general employees. Since theintroduction of this system, we have continued its operationin order that each employee can transform themselves into a
specialist by using a dynamic, competitive system that rewards
work value, role responsibility, and results in line with changing
employee roles in the midst of a changing business environment.
Also, as a global specialist company with a highly competitive
human resources structure, our aim is to have our employees
achieve self-fulfillment through their own efforts. To achieve theabove, we are using the SAP SuccessFactors talent management
system introduced in 2022.

Engagement
Composition of Employees
The main production bases in each segment are China, Vietnam,
and the Philippines for the VCCS segment, Malaysia, Vietnam,
and Japan for the CTC segment, Malaysia and China for the
Fine Connector business in the FC/MD segment, and Japanfor the Medical Device business in that same segment. Our
production bases are concentrated in Asia. In particular, there area large number of employees in China and Vietnam, which areproduction bases for the VCCS segment.

▼ Recruitment and Turnover▼Average age and years of service

YOKOWO CO., LTD.

Total number of
new recruitments

79

Male

63

Female16

Total number of
job leavers

26

Male

21

Female5

YOKOWO CO., LTD.

Average age

40.7

Male

40.5

Female41.9

Average years ofservice

11.7

Male

11.3

Female15.2

Work-Life Balance■ Hourly paid leave■ Special COVID-19 vaccination leave■ Long service incentive system (newly established in FY2023)

General manager

New general manager training

Deputy General
Manager

New deputy general manager training

Manager

New manager training

Assistant Manager

Mid-career employee (leader) training

MemberYoung employee training

Induction

Self-education

43

Yokowo 2023 Integrated Report

Specialty training

Common training

Next-generation leader
selective training

Sales
department
training

Technology
department
training

Tentative assignment/basic training

Production
department
training

Administration
department
training

Self-education
Online education (position-specific) andlanguage training

Yokowo has established a childcare leave system to support
employees in balancing work with childcare. In FY2022, 23.1%
of male, and 100% of female employees took childcare leave.

Other work-life balance measures

Position-specific training

Training on current affairs

Use of childcare leave

We have established an “integrated human resource
development system starting with new employees” in order
to cultivate “globally-minded human resources” who will
support the full-scale globalization of our business and toactively promote the strengthening of management at alllevels. In addition to training that is common to all employees,
we provide diverse position-specific and specialty training
to encourage employee growth. In the future, Yokowo will
create a “new training system” to better support employeesʼ
independence in their skill and career development, and aim tobecome a company that can provide more specialized training
opportunities to employees.
Furthermore, in FY2023 we established the new Human
Resource Development Center. As well as having an oversight
position to raise the job performance of all officers and employees,
and to establish a competitive advantage in the ability of top-level
talent to implement advanced technologies, this is responsible
for building an education system covering management andbusiness operations. We are currently compiling human resources
development plans for each department, and moving forwardwith the development of specific training plans.

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

The Group has established a nursing care leave system to support
employees in balancing work with nursing care. In FY2022, noemployees took nursing care leave.

Non-management
position

We promote the use of annual paid leave aiming for an annual paid
leave utilization rate*2 of 70%, which is the target for FY2022.

Management
position

Use of nursing care leave*2 Number of annual paid leave days taken ÷ number of annual paid leavedays newly granted each fiscal year

Human Resources Development▼ Conceptual Diagram of Training System

Percentage of annual paid leave taken

In FY2022, the annual paid leave utilization rate was 71.5%.

Yokowo conducted its first engagement survey in FY2022. In
addition to understanding the degree of congruence between
our direction (Purpose, Vision, and Values) indicated in our
corporate philosophy and individual employeesʼdirections(diverse self-actualization), this has as its objective understanding
areas for improvement in the workplace environment, so that
the Group can achieve sustainable growth.
We will improve workplace environments in each department
as indicated through these results, then review and constructinternal mechanisms. Looking forward, we will promote employee
engagement in order that every employee has trust in thecompany and in our organization, and that they are motivated towork toward both personal and corporate growth.

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

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

Yokowo 2023 Integrated Report

44

ESG Report

Diversity
Through the promotion of DEI (Diversity, Equity, and Inclusion), the Yokowo Group is promoting the recruitment
and development of human resources without regard to nationality, gender, or age, with the aim of becoming Team
Yokowo, a “sustainably evolving company.”

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

Concrete Measures Relating toDiversity
The Yokowo Group treats “diversity and inclusion” as one of ourmanagement strategies. We are striving to become a company
where employees with the diverse values of global Yokowo areable to come together and work together on a global basis toachieve their full potential. In terms of diversity, we are steadily
promoting measures based on the TISP Project to expand thefield of activities of non-Japanese employees. However, there arestill many issues to be addressed in increasing the ratio of female
leaders and the ratio of employees with disabilities.
In 2021, the revised Child Care and Family Care Leave Law
was enacted, requiring companies to encourage male employees
to take childcare leave. The ratio of male employees taking thisin FY2021 was 5.3% and in FY2022 23.1%, showing a definite
uptake, but we feel there is more progress to be made.
In order to clarify these issues in our organizational culture
and systems, and to share the direction for improvement andreform, Yokowo is holding “roundtable meetings” where theemployees concerned can frankly exchange opinions, and so thatdiverse personnel are able to work comfortably, we are putting
in place initiatives such as making head office buildings and the“Micro Process R&D Center” research and development facility
at the Tomioka plant barrier-free, and installing a prayer room.

Promoting Active Participation by Women
Due to the fact that Yokowo is a manufacturing company, thenumber of permanent female employees hired is small, andthe ratio of female leaders is currently lower than that of male
employees due to the small pool of female employees. However,our goal is to increase the ratio of female leaders to at least thesame as that of male leaders. So that we can reach this goal,
we have started appointing women as outside directors andinto management positions. We are also taking steps to identify
gender-based wage gaps, and to reform the system to eliminate
any disparities.

45

Yokowo 2023 Integrated Report▼ Male-female wage gap
Percentage wage difference (%)
Executives

84.1

Supervisors (SV)*1

94.5

Creative (C)*

85.2

2

Technical (T)*112.4

Routine (R)*4－(No corresponding male employees)

3*1 Business management: Role that leads a team of a particular size, thatmanages overall promotion of the business, and that uses their high levels of
specialist knowledge and know-how to create high added value*2 Creative work: Role that performs creative work in order to acquire new
business opportunities*3 Vocational work: Role that performs specialized work of a defined type
*4 Basic work: Role that performs routine operations with fixed procedures andmethods▼ Percentage of female employees★
(persons)

1,000

600
400

16.3

14.9

800

665
11.1

17.8

764

710

11.5

12

10.7
8.3

7.2

2018

16

814

798

2019

2020

Number of YOKOWO CO., LTD. employees*

5

2021

Promoting Active Participation
by Senior Human Resources
In addition to the existing system of re-employment(reemployment after transfer to an affiliated company),
we established a new system to extend employment after
retirement at the age of 60 as permanent employees at our
Head Office in 2020 in order to promote the active participation
by senior human resources. This is subject to approval by the
Personnel Committee if the Company deems it necessary andthe employee agrees to do so for the purpose of transferring
technology to younger employees or utilizing proprietary
technology and know-how.This system also allows those whoare 65 years old or older to continue to playing an active role
under an outsourcing contract or consultant contract if theCompany deems it necessary and agrees with the individual.
Furthermore, we hold roundtable meetings for senior humanresources to further improve the system while incorporating
the opinions of the people concerned.

20

16.3

200
0

（％）

19.2

disabilities work without undue concern, but that employees canfurther deepen their knowledge.

8▼ Number of older employees re-employed★
（FY）

2018

2019

2020

2021

2022

(persons)

19

22

30

34

38

★: YOKOWO CO., LTD.

2022

(FY)
Percentage of female managers*6

Percentage of permanent female employees*7*5 Number of Yokowo Co., Ltd. employees: Does not include temporary staff*6 Overall ratio of female employees who are section heads or higher (excludes
specialists)*7 Ratio of female employees out of all employees★: YOKOWO CO., LTD.

Employment of People with Disabilities
Yokowo is a manufacturing company focusing on micro-precision
processing. As such, we have not made progress on hiring people
with disabilities, and we have not met the legally mandated
employment rate. Nevertheless, from the perspective of the SDGs,
we have set a goal to at least double the employment rate ofpeople with disabilities compared to the legally mandated rate.
In order to achieve this goal, we determined the need to develop
both tangible and intangible company-wide infrastructure anddevelopment of jobs that would enable people with disabilities toplay active roles, and set up the “Project Team for Establishing aSpecial Subsidiary.”
Yokowo Future-Oriented Support was established in FY2022,
and certified as a special subsidiary in March 2023. By introducing
public health nurses and holding supporter training courses
for employees, we are ensuring that not only can people withAt the Yokowo Group, we are promoting the “TISP (Tomioka
International Specialist Park) Project” as a central part of ourdiversity and inclusion initiatives.
This project brings together specialists from around theworld (in product design, production engineering, elemental
technologies, quality assurance, production control, etc.) to ourmain plant—the Tomioka plant (Gunma Prefecture).
Hiring criteria place no particular requirements as regards
Japanese conversational ability, and have a focus on expertisefor midcareer hires, and potential for new graduates. Looking
forward, we aim to bring together 120 foreign specialists
centered around the Tomioka plant. With this project, we are
actively recruiting foreign employees living in Japan, and thoseliving overseas. In particular at our main production bases in China,
Vietnam, and Malaysia, we have in place a multi-year training
program in Japan for new graduate hires who have graduatedfrom local universities in those countries. For these trainees, wecreate an individualized CDP (Career Development Plan) with which
we provide systematic human resource training, and many of the
trainees who have completed their training in Japan return to workin their own countries.
▼ Changes in TISP human resources★
(persons)

80

66

4
0

TISP Project

60

Strengthened Mid-career Hiring
The Yokowo Group corporate vision incorporates the message
that “as Team Yokowo, by creating new products that40

incorporate cutting-edge advancements based upon the Groupʼs
proprietary technology, we want to be a company that while
evolving, achieves persistent growth.”
The Yokowo Group in principle enhances our workforce byhiring new graduates, however recent years have seen an increasein the ratio of mid-career hires supported by strong businessperformance. We are bringing together all employees who
sympathize with this message, regardless of new graduate or midcareer hires, irrespective of gender, age, or nationality.

20▼ Changes in new graduate hires and mid-career hires★
（FY）

2018

2019

2020

2021

2022

New graduate hires

20

18

22

28

22

Mid-career hires

45

49

30

60

57

0

71

72

2021

2022

61

54

2018

2019

2020

★: YOKOWO CO., LTD.

(FY)

Introduction of secondary job system
In FY2022, we established a new secondary job system to help
employees achieve a variety of work styles, as one way to support
their autonomous career development. We will continue to lookfor ways to enhance the system itself, with the aim of supporting
employees in further bettering themselves.

★: YOKOWO CO., LTD.

Yokowo 2023 Integrated Report46

ESG Report

Human Rights

Occupational Health & Safety: OH & S

In the future, the Yokowo Group will continue listening to the diverse voices of our colleagues, seeking guidancefrom around the world. We will work together with all stakeholders who support our business activities, including
the families supporting our employees, our customers and business partners, and local communities, and we will also
always envision a better and more prosperous future, and aim to be an evolving, enduring company that continues
to create something new.

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

Concepts around Human Rights

Performing Human Rights Due Diligence

In order to achieve our purpose, the Yokowo Group will
strive to respect human rights by placing respect—having ahigh regard for diverse ranges of individuality and treading all
individuals with sincerity—at the top of our sense of values at
all stages throughout the value chain.

Based upon the United Nationʼs Guiding Principles on Businessand Human Rights, the Yokowo Group has put in place asystem to identify, prevent, and mitigate adverse impacts onhuman rights through our business activities, to evaluate theeffectiveness of our efforts, and to both explain and disclose
information on how we have addressed concerns.

Human Rights Policy
So that we can realize respect for human rights, one of
the important themes in sustainability, the Yokowo Group
formulated the Yokowo Group Human Rights Policy on April,
2023. This policy illustrates our commitment and responsibility torespect the human rights of all stakeholders engaged with ourbusiness activities, based around the Yokowo Groupʼs purpose.
The Human Rights, Labor, and Ethics Management
Committee is responsible for this policyʼs operation under thesupervision of the Board of Directors.
* Refer to our corporate website for details regarding our Human Rights Policy.
https://www.yokowo.co.jp/english/company/csr/humanright.html▼ Human Rights, Labor, and Ethics Management Committee structure
Steering Committee
Chairperson
Committee Members (4)Complaint Handling Mechanisms
The Yokowo Group has in place a contact point for consultation
and reporting that can be used anonymously. If necessary, thisconsults with external experts in order to resolve issues and takemeasures to prevent recurrence. We have put in place a complainthandling mechanism to identify and address in a timely mannerhuman rights concerns raised by stakeholders.
▼ Complaint handling mechanism structure
Consultation

Company

External experts
AdviceContact

State concern with adverse
impact on human rights,
and file complaints

Project Leader

Internal stakeholders(employees)

Investigate received
concerns and complaints,
and provide relief measures,
thus creating credibility

External stakeholders(workers in the supply chain,
local residents, consumers,
NGOs, etc.)

Secretariat

Human Rights Education
Related departments including
Personnel Department,
General Affairs Department

Domestic Subsidiaries

In May 2023, the Group conducted training into “Responding tohuman rights, and sustainable corporate growth” for directors,
executive officers, and the Human Rights, Labor, and Ethics
Management Committee. In September of the same year, we
conducted training for management on the Yokowo Human Rights
Policy, promoting its spread and understanding witin the company.

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

Occupational Health and Safety Framework
Yokowoʼs Health and Safety Promotion Committee meets on amonthly basis. The Committee is headed by senior management
and consisting of the OH&S managers and promoters of eachdepartment, who play a central role in practical health and safety
activities. The Committee strives to realize continued improvementof OH&S activities by sharing the progress made in individual
departmentsʼ OH&S action plans, the results of monthly OH&S
inspections, and details of occupational accidents and the remedial
measures taken. In addition, the Committee holds monthly
meetings to provide a venue for talks between its members, bothfrom labor and management, with the participation of occupational
physicians, etc., as required by law. The Risk Assessment Committee
evaluates remedial measures when responding to unexpectedoccupational accidents. It discusses and confirms whether themeasures proposed by the department where the accident occurred
are effective from an objective viewpoint, and whether there are
any oversights in preventing reoccurrence.
In April 2021, the Occupational Health and Safety Section
was established within the General Affairs Department. This new
department aims to further expand measures that contributetowards OH&S, with a particular focus on promoting the activitiesof the various committees.
▼ Occupational Health and Safety Management Framework
Chief Occupational Health and Safety Management Officer
President & Executive Officer / General Manager, Tomioka Plant
General Managers, Health and Safety Management /Senior Health and Safety Management Officer
Occupational Health and
Safety Section

47

Yokowo 2023 Integrated Report

FY2020

FY2021

FY2022

Coverage

Frequency of occupational
accidents*1

0.59

2.20

1.02

Non-consolidated

No. of serious occupational
accidents*2

0

0

0

Consolidated(Japan)No. of occupational
accidents (accidents withlost work days)

2

3

2

Consolidated(Japan)*1 Frequency of occupational accidents: Number of occupational accidents leading toinjury or death per million working hours, indicating the frequency of accidents.
*2 No. of serious occupational accidents: Number of serious occupational
accidents resulting in permanent disability or death.

To Realize Improvements in
Occupational Health and Safety
Yokowo has constructed an occupational health and safety
management system (OHSMS), and is working to advance its OH&S
efforts as the entire Group under the OH&S Policy.
YOKOWO CO., LTD., including the following subsidiaries, has
acquired “ISO 45001” certification, the international standard for
occupational health and safety management systems.
▼ ISO 45001 Certification Status
2020

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

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

An energetic
workplace
Work
style

Healthy mind
and body
A healthy
Healthworkplace

SafetyHealth and Safety Committee
Health and Safety
Promotion Committee

Head Office, Tomioka Plant
Domestic Offices▼ Occurrence of Occupational Accidents Over the Past Three Years

Domestic Subsidiaries

Risk Assessment
Committee
Cooperative Company
in Tomioka Plant

A safe and secure workplace
Eliminate unsafe conditions
Eliminate unsafe behaviors

Follow rules / Self-management / Compliance

Yokowo 2023 Integrated Report48

ESG Report

Procurement

Local Communities

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

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

Approach to Procurement

On Contributing to Local Communities

Activities in Local Communities

As a member of local communities, the Yokowo Group is
promoting a range of social action programs. Focused around
activities grounded in the community, activities towards
achieving a sustainable society, and activities that contributeto community development, our aim is to develop alongside
local communities through initiatives that contribute to solving
societal issues.

Sports Classes

Besides striving to ensure fair and equitable transactions with our
suppliers, the Yokowo Group also aims to provide required goods
for corporate activities in the required time, at the required quality,
in the required location and at the required price, while promoting
proactive procurement activities that contribute towards theCompanyʼs sales and maximizing profitability. We not only comply
with all relevant laws and regulations, such as the Act against
Delay in Payment of Subcontract Proceeds, etc. to Subcontractors,
but also strive to fulfill our social responsibility within the supply
chain in order to build multilayered production bases and a reliablesupply network when undertaking day-to-day purchasing activities.

Details of the Business Policies
Cost Reduction■ Striving to reduce costs (principle cost)■ Ensuring that costs are set early (DFC)■ Thorough implementation of the principle ofSangenshugi—the Three Actuals (the actual
place, the actual part, and the actual situation)

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

Strengthening
Procurement
Capability■ Developing human resources and continuityof operations■ Compliance with relevant laws, ordinances,and specifications■ Consideration for the environment and forsociety

Basic Policies
Vision (future aspirations)

Aim to be a Purchasing H.Q. that can achieve proactive purchasing activities.
“Transformation from a passive to an active Purchasing H.Q.”

Mission (tasks to perform)

Provide required goods for corporate activities in the required time, at therequired quality, in the required location and at the required price, andcontribute towards the Company’s sales and maximizing profitability.

Policies (business policies)

Use Cost Reductions, Enhanced BCP, and Strengthening Procurement
Capabilities as basic policies to work as a Purchasing Professional.

Measures Relating to Procurement
Compliance with the Act against Delay inPayment of Subcontract Proceeds, Etc. to
Subcontractors (Subcontract Act)■ Having employees attend external seminars■ Implementation of internal education■ Responding to Japan Fair Trade Commission (JFTC)

questionnaire surveys■ Checks and inspections performed in day-to-day operations(negotiations, unit price setting, acceptance inspection, and payment)

Elimination of child labor, prohibited chemical
substances, and use of conflict minerals■ The requirement to eliminate child labor, use of prohibited chemical

substances, and use of conflict minerals is clearly stipulated in
the Code of Conduct for Business Transactions (and Agreement),
which was compiled as an annex when Yokowo revised its masteragreements pursuant to the revision of Japanʼs Civil Code49

Yokowo 2023 Integrated Report■ Surveys of the substances contained in mass-produced products

are being implemented at all Yokowo Group plants■ When launching production of a new model, suppliers are

required to provide data on the substances contained at the timeof the first sample inspection■ The prohibition on conflict minerals applies to materials that havecobalt, cassiterite, tungsten or gold as a raw material

Implementing Green Procurement
The Yokowo Group holds presentations for our suppliers on chemical
substances contained in products, and we implement environmental
assessment that includes constituent analysis of the items that
suppliers deliver. In addition, the master agreement that we sign with
suppliers includes provisions relating to not using harmful chemical
substances, our procurement activities prioritize purchasing items
that have a smaller environmental footprint, and product verificationis performed in collaboration with our Quality Assurance H.Q.

▼ Three Areas of Activities

Activities groundedin the community

Activities towards
achievinga sustainable society

Activities that
contribute tocommunity development

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

In February and August 2023, Yokowo held a sports event
inviting children from basketball teams at Tomioka City
elementary schools to the Yokowo Silk Arena Tomioka, a civic
gymnasium in Tomioka City with which we have a naming rights
agreement.
As well as having coaches and staff from the Gunma Crane
Thunders professional basketball team participate as instructors,
NPOs from Tomioka City and students from local high schools
also offered their help as volunteers.
The Yokowo Group is working together with local governmenton activities to interact with the local community through sport,
and to increase the number of people playing sport.

Tomioka Donto Festival
Every two years, the Tomioka Plant participates in the Tomioka
Donto Festival, a two-day festival characteristic of the region heldin the center of Tomioka City.
Many employees participated in the last festival held in
October 2022, enhancing exchanges with local residents throughthe “Odori Nagashi,” a 40-minute dance processing through thestreets of Tomioka City.

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

Yokowo 2023 Integrated Report50Appendix

Financial Highlight▼ Net sales
Sales growth rate (％）

77,96280,00054,75260,595

16.6

66,84859,976

20.0

Operating profit (million yen）

4,916

5,179
8.6

8.1

15.0

12.0

10.7
10.0

11.5

6.1

5.5

2,000
20,000

10.0
8.0

7.0

3,028

3,000

4,739

4,684

4,000

40,000

6.0
4.0

5.0
5.5

0

Operating profit margin (％)

6,000
5,000

2018
■ Net sales

1,000

-1.0
2019 2020
Sales growth rate

2021

2022

0

▼ Ordinary profit

2018

6,529

7,000
6,000

5,675

5,320

■ Operating profit

4,000

2020

2021

Operating profit margin

3,286

16.3

14.9

800

710

665

600

11.1

400

764

16.3
16

814

798
11.5

12

10.7
8.3

7.2

200

2022

0

0.0

(FY)

2018

2019

2020

2022

0.0

(FY)

2018

2019

2020

2021

2022
(FY)

▼ Basic earnings per share
(yen)
250

169.85

184.55

(％)

3,440

0

1.6

1.5

1.5

135.01

100

2018

2019

2020

2021

2022

0.0

2018

(FY)

2019

2020

2021

0

2022
(FY)

2019

2020

2021

2022

38

40

1,899.19
1,209.3630

30

1,640.21
1,306.58

20

20,000

22

19

0

0
2018

2019

2020

2021

2022

2018

2019

2020

4,366
3,260

3,592

3,000

3,201

3,405

0

337,500
325,000
312,500

6,000

335,868

2018

2019

* Borrowing + lease liabilities

Yokowo 2023 Integrated Report

2020

2021

2022

（FY）

20,2220.372

20,0070.334

21,104

21,853

Waste (t)

8

2,000

6

4.722
3.892

283,178

275,000

2018

2019

2020

2021

2022

（FY）

250,000

3.513

273,845
260,1792018■ Water usage

2019

0.5
0.4

0.334

0.3

0.316
0.280

0.2
0.1

2018

2019

2020

2021

2022

0.0

(FY)

Emission factor

Recycling rate (%)
87.1

85.2

7

262,500
0

Emission factor (CO2 emissions/sales value)*5

Total GHG emissions（■Scope1 ■Scope2）

Usage rate (water usage/sales) *5.687

287,500

1,000

(FY)

344,632

6.134

0

2022

6

300,000

2,000

2,000

(FY)

▼ Quantity of waste and recycling rate

3

4,000

2021

（FY）

350,000

4,000

20,371

2022

5,000

Water usage (m )

7,773

71.5

10,000

5,000

7,589

2021

15,000(million yen)

8,000

2020

25,00034

2,022.92(million yen)

9,155

2019

GHG emissions (t-CO2)*4▼ Water usage and usage rates

10,000

2018

(yen)

▼ Research and development expenses

10,43565.2▼ GHG emissions and emission factor（FY）

11,18063.6(persons)▼ Interest bearing debt*

12,00065.2▼ Number of older employees re-employed★

10

2018

67.2

▼ Net assets per share

1,500

(FY)

20

500

0

2022

40

1,000

50

2021

60

3,147
1.0

2,000

109.18

2020

80

1.7
1.5

3,818

202.28

150

2019

(％)

2,500

200

2018

Number of Yokowo Co., Ltd. employees*1
Percentage of female employees*2
Percentage of female management leaders*3

2.0

4,000

3.5

3.0

(million yen）

4,663

3.6

3.2

1.0

0

1,000

0

3.4

5,000

2,209

1,000

4.0

2.0

4

2021

(％)
5.0

2.0

8

2,000

2,000

51

（％）
20

19.2

17.8

▼ Uptake of paid leave★

3,000

3,000

1,000

▼ Employment rate of people with disabilities★

4,583

5,000

2019

▼ Profit attributable to owners of parent(million yen）

(persons)

2.0

0

(FY)

▼ Employee turnover rate★

▼ Percentage of female employees★

▼ Operating profit

Net sales (million yen)

60,000Non-financial Highlight

2020
Usage rate

2021

5

(FY)

1,200

4
3
2
1

2022

1,600

0

53.8

1,150

59.4

1,430

1,250

90
70.5

80

1,500

60
50

1,056

800

70

40
30
20

400

10
0

2018
■ Waste

2019

2020

Recycling rate

2021

2022

0

(FY)

★: YOKOWO CO., LTD.
*1 Number of Yokowo Co., Ltd. employees: Does not include temporary staff *2 Ratio of female employees out of all employees*3 Overall ratio of female employees who are section heads or higher (excludes specialists)*4 Electricity CO2 conversion factor is calculated using the following:Domestic: TEPCO Energy Partner, Inc Basic Emission Factor
Overseas: Until 2021, IEA Official Factor, 2022 uses the market coefficient*5 Emission factor: GHG emissions per million yen of sales *6 Emission factor: Water usage per million yen of sales
Yokowo 2023 Integrated Report52

Appendix

Financial Information
Analysis of Operating Results and Financial Position in Fiscal 2022

Business Environment and Operating Results
During the fiscal year under review (April 1, 2022 to March
31, 2023), the global economy trended toward recovery as the
COVID-19 pandemic eased, however global inflation continues
despite hikes in policy rates in major countries, and in combination
with the longer shortage of semiconductors, supply chains continued
to be disrupted and stagnant.
Market structure in the Groupʼs core markets — automotive,▼ Minimum 8

As a result, total liabilities stood at ¥23,431 million at the end of the

production facilities at the production subsidiary in Vietnam, and（%）

fiscal year under review (a gain of ¥890 million from the end of thethe expansion of processing facilities at the production subsidiaryprevious fiscal year).

in Malaysia. In and after the fiscal year ended March 31, 2023, the

20

16.6
13.5

15

11.6
11.5

8.6

8.1

5

5.5

semiconductor testing, mobile communication terminals, andadvanced medical equipment markets — has intensified with both

10.7

9.3

10

12.2

Group plans to construct plants within Japan and in Vietnam for the

7.0

6.9
6.1

-1.0
0

2018

the widespread adoption of advanced applications that could

2019

Sales growth rate

dramatically change industry structures and business models with 5G

2020

2021

Operating profit margin

2022
(FY)

ROE

mobile communication systems at the forefront, and competition in
product and technology development.
In these circumstances, the Group continued working to advance

Financial Position

the four forms of innovation (innovation in products, processes,(Assets)

personnel, and management) specified in the Basic Management

Although there were a decrease in notes and accounts receivable-

Policy to achieve high-quality, full-scale growth. In the VCCS

trade of ￥707 million and a decrease in inventories of ¥1,399

segment, costs at overseas production bases ballooned due to themillion, current assets stood at ¥46,355 million at the end of therapid, ongoing depreciation of the yen, however the Group has beenfiscal year under review (a gain of ¥1,815 million from the end of thenegotiating to revise sales prices in response to higher raw material

previous fiscal year) due to an increase in cash and cash equivalents

prices, and is working to rebuild its earnings structure. In the CTCof ¥3,870 million. The decrease in notes and accounts receivable-

segment, as well as strengthening technology and manufacturing

trade is primarily as a result of decreased sales due to a decrease insystems in order to grasp business growth opportunities arising fromorders received in the CTC segment in the fourth quarter. Further,

5G, the Group has continued with establishing production sites in

the large decrease in inventories is due to a decrease in shipping

Japan and Vietnam targeting a future increase in orders.

inventories resulting from a normalization of lead times in ocean andAs a result, while the FC/MD segment saw a year-on-year decline

air logistics in the VCCS segment.

in consolidated net sales, both the VCCS and CTC segments saw

Non-current assets stood at ¥24,300 million at the end of theyear-on-year increases in sales, resulting in increased sales overall.

fiscal year under review (a gain of ¥1,970 million from the end of

In operating profit and loss, while the FC/MD segment saw a year-

the previous fiscal year) due to an increase in property plant andon-year decrease in sales and a decrease in profits due to changes

equipment of ¥1,532 million and an increase in investments andin business structure, and the VCCS segment posted a loss dueother assets of ¥390 million. This was due to vigorous investment into dramatically higher distribution costs and higher costs resulting

mass production and development in each business segment.

from higher raw material prices and the low yen, the CTC segment

As a result, total assets stood at ¥70,656 million at the end of thesaw a significant year-on-year increase in profits due to higher

fiscal year under review (a gain of ¥3,786 million from the end of thesales, resulting in increased profits. While ordinary profit and losses

previous fiscal year).

recorded gains from foreign exchange, recording of equity losses
due to worsening business performance of investees resulted(Liabilities)

in decreased profits. Profit attributable to owners of the parent

Current liabilities stood at ¥17,890 million at the end of the fiscal

company decreased due to an impairment loss on non-current assets

year under review (a decrease of ¥2,294 million from the end of

in the VCCS segment.

the previous fiscal year). This was as a result of a decrease in trade
payables of ¥1,507 million and of income taxes payable of ¥961
million, in spite of an increase in short-term loans payable of ¥233
million. The decrease in trade payables is primarily because of
decreased purchasing of parts based on forecasts of a decrease inorders in the next fiscal year in the CTC segment.
Non-current liabilities stood at ¥5,541 million at the end of the
fiscal year under review (a gain of ¥3,184 million from the end of theprevious fiscal year) due to an increase in long-term loans payable of¥3,000 million and an increase in lease assets of ¥168 million.

53

Yokowo 2023 Integrated Report(Net Assets)

CTC segment as well as further boost capacity at the production

Net assets stood at ¥47,224 million at the end of the fiscal year undersubsidiary in Malaysia. To fund this capital investment, in addition toreview (a gain of ¥2,896 million from the end of the previous fiscal

operating cash flow, the Group has refinanced long-term loans, butyear). This was mainly due to an increase in foreign currency translation

has reduced the amount through partial repayment. On the otheradjustment of ¥871 million, profit attributable to owners of parent

hand, under the new medium-term management plan, in order tocompany of ¥3,147 million, and dividends of surplus of ¥1,095 million.

break through the limitations of existing businesses and technologies

Cash Flowsand acquire new growth potential from a medium- to long-term
perspective, the Group plans to invest in basic research to further(1) Cash and Cash Equivalents

deepen its core technologies and in capital investment to enter new

Cash and cash equivalents stood at ¥17,687 million in the fiscal year

fields, such as the construction of new MEMS probe card production

under review (a gain of ¥3,870 million from the previous fiscal year).

lines. To raise funds for these purposes, the company issued 3 million(2) Net Cash Provided by Operating Activities

new shares thus raising approximately ¥7.6 billion from the issuanceNet cash provided by operating activities stood at ¥7,312 million (aof stock acquisition rights through a third-party allotment that theygain of ¥3,635 million from the previous fiscal year) with the main

resolved to issue in November 2020, and the exercise of these rights.

factors for increase including profit before income taxes of ¥4,433

However, funds have been allocated to product and parts inventories

million and depreciation of ¥3,833 million, and the main factors forthat have ballooned due to supply chain disruptions and longer leaddecrease including a decrease in trade payables of ¥2,652 million

times for ocean freight in the VCCS segment, and as a result, thebecause of decreased purchasing of parts based on forecasts of aGroupʼs cash and cash equivalents stood at ¥17,687 million at thedecrease in orders in the next fiscal year in the CTC segment.

end of the fiscal year under review, up ¥3,870 million from the end(3) Net Cash Used in Investing Activitiesof the previous fiscal year.

Net cash used in investing activities stood at ¥5,857 million (adecrease of ¥110 million from the previous fiscal year). The main
factors for decrease included purchase of property, plant andequipment, including construction of the MP Center (new R&D
building), of ¥4,645 million, and purchase of intangible assets of¥591 million.

(4) Net Cash Provided by Financing Activities
Net cash provided by financing activities stood at ¥1,531 million (again of ¥1,360 million from the previous fiscal year). Main factors forincrease included proceeds from long-term loans payable of ¥3,000
million, whereas the main factors for decrease included payment ofdividends of ¥1,093 million.

(5) Information on Liquidity and Capital Resources
The Groupʼs working capital is mainly spent on procurement of raw▼ Net Assets / Capital Adequacy Ratio
Net assets (million yen)
50,000

57.2

63.6
55.1

40,00030,00036,202
24,486

Capital adequacy ratio (％)
66.7
66.2
70

44,32847,22450

26,53240
30

20,00020

10,000
0

60

10
2018
■ Net assets

2019
2020
2021
Capital adequacy ratio

2022

0

(FY)

materials and parts used in the manufacture of products, and is alsosimilarly expended on goods and services recorded in manufacturing,
selling, and general and administrative expenses. In addition, capital
investment funds are expended on establishing and strengthening
production systems, such as the acquisition of production
equipment, and on maintaining information systems. The Companyʼsbasic policy is to provide for the funding necessary for these throughinternal funds generated by the recorded profit and depreciation.
In the fiscal year under review, the Group actively invested in
expanding mass production facilities including research anddevelopment as well as product development, construction of aplant at the production subsidiary in the Philippines, expansion of

Yokowo 2023 Integrated Report54Appendix

CONSOLIDATED BALANCE SHEETSCapital Investment

fields, development of technology in new businesses, and in tapping

In the fiscal year under review, the Group continued to make capitalnew markets.

investments, primarily in the expansion of production facilities.
Investment in intangible assets is included in addition to investment(millions of yen)

dividend twice a year: an interim dividend and a year-end dividend.
The decision-making bodies for dividends are the Board ofin property, plant and equipment.
Total capital investment in the fiscal year under review was¥5,448 million, and an overview of capital investment is as follows.

Fiscal 2021
(As of March
31,2022)

The Companyʼs basic policy for dividends from surplus is to pay a

Fiscal 2022
(As of March
31,2023)ASSETS

Directors for the interim dividend and the General Meeting ofCurrent assets

Shareholders for the year-end dividend.
In business performance for the fiscal year under review, sales in

Cash and deposits

13,816

17,687

Notes and accounts receivable-trade

13,057

12,350

Merchandise and finished goods

8,900

7,781

(1. Property, plant and equipment)(1) VCCS

the FC/MD segment were sluggish, but there was an increase in sales

The Group implemented total capital investment of ¥2,377 million.

yen, resulting in record-high consolidated net sales. In terms of profit,

Inventories

742

427

This included expansion of capacity at the Vietnamese plant aimed

full-year consolidated net sales remained at a level only slightly above

Raw materials and supplies

6,037

6,073

at increasing work volume in parallel with the strengthening of

the previous year. Reasons for this were continued losses in the VCCS

Other

1,992

2,040

development functions at the China plant, along with completion ofsegment and decreased profits in the FC/MD segment, coupled with

Allowance for doubtful accounts

construction work at the Philippines plant.

the CTC segment, which had performed very well in the first half ofTotal current assets(2) CTC

the fiscal year, but experienced a sharp drop from the second half of

The Group implemented total capital investment of ¥2,043 million.

the fiscal year on the back of reduced demand from customers andThis included expansion of mass production facilities and of image

the industry as a whole. Additionally, consolidated ordinary profit

measurement equipment at production sites in Japan to accommodate

and profit attributable to owners of the parent company dropped

order growth and shorter delivery times for semiconductor test tools inover the same period in the previous fiscal year. Reasons included

the first half of the fiscal year.

(3) FC/MDin both the VCCS and CTC segments due to the significantly weaker

(8)

(4)

44,54046,355

8,085

10,433

Accumulated depreciation(4,341)(5,176)

recording of equity losses due to worsening business performance

Buildings and structures, net

3,744

5,256

of investees, and an impairment loss on non-current assets in the

Machinery, equipment and vehicles

Non-current assets
Net property, plant and equipment
Buildings and structures

14,626

16,482The Group implemented total capital investment of ¥384 million,

VCCS segment. As a result, in the Groupʼs “Minimum 8” medium-

Accumulated depreciation(9,651)(10,988)

carrying out updates and expansion at the Chinese plant, including massterm management targets (ensure 8% growth in sales growth rate,

Machinery, equipment and vehicles, net

4,975

5,493

production facilities in the Fine Connector business.

minimum operating profit margin, and return on equity (ROE)), we

Tools, furniture and fixtures

achieved the growth in sales growth rate of 8%, but failed to meetthe minimum operating profit margin (6.1%) and ROE (6.9%).

(2. Intangible assets)
The Group implemented total capital investment of ¥643 million.

Based on the circumstances outlined above, and comprehensively

This included improving and updating the environment for coretaking into account the return of record high profit to shareholders,

information systems in order to realize Group-wide businessdemand for funds in the next fiscal year onward and the securing ofstreamlining, introducing a human resources management system,

financial stability, the Company submitted the proposal for a yearend

and enhancing and updating CAD systems.

dividend for the fiscal year under review of 25 yen per share to the▼ Capital expenditures

6,000
5,000

5,092

Tools, furniture and fixtures, net

2,852

2,776

Accumulated depreciation
Leased assets, net

761

761

1,820

1,790

(1,012)(1,070)

808

720

433

702

85th General Meeting of Shareholders, and it was approved. With an

Right-of-use assetsinterim dividend of 25 yen per share for the fiscal year under review

Construction in progress

2,970

2,366

already paid, the Companyʼs annual dividend is 50 yen per share

Total property, plant and equipment

16,544

18,077

Intangible assets

Furthermore, the Companyʼs Articles of Incorporation stipulate

5

－

Other

1,156

1,210

Total intangible assets

1,162

1,210

1,587

1,979

680

466

Leased assetsthat an interim dividend can be paid.

3,625

Investments and other assets

3,000

Investment securities

2,000▼ Dividend per share

1,000
0

(9,708)

Land

4,430

4,231

4,000

5,448

12,485(8,479)Leased assets(consolidated payout ratio of 37.0％).

(million yen)

11,331

Accumulated depreciation

Retirement benefit asset

2019

2020

2021

2022
(FY)

50

50
40

Basic Policy for Dividends
The Company views the strengthening of returns to shareholders as
an important task for management. The basic policy for dividends

30
20

40

36
23.8

Deferred tax assets

Consolidated payout ratio (％)

Dividend per share (yen)
2018

40
37.0

Total investments and other assets
30

30
20

26
17.7

Other
Total non-current assets
Total assets

678

901

1,676

1,666

4,623

5,013

22,33024,30066,87070,656

19.8

19.5

10

10

in each fiscal year defines stable and continuous distribution ofdividends with due consideration for retained earnings, for the
purposes of investments in production facilities in growing business

55

Yokowo 2023 Integrated Report

0

2018

2019

■ Dividend per share

2020

2021

2022

0

(FY)

Consolidated payout ratio

Yokowo 2023 Integrated Report56

Appendix

CONSOLIDATED STATEMENTS OF INCOME(millions of yen)

Fiscal 2021
(As of March
31,2022)(millions of yen)

Fiscal 2022
(As of March
31,2023)

Fiscal 2021
Fiscal 2022
(From April 1, 2021 (From April 1, 2022
to March 31, 2022) to March 31, 2023)

LIABILITIESCurrent liabilities

Net sales

66,84877,962

Cost of sales

53,63863,067

Notes and accounts payable-trade

7,991

6,483

Gross profit

13,20914,894

Short-term loans payable

5,570

5,804

Selling, general and administrative expenses

8,525

10,155343

348

Operating profit

4,684

4,739

Income taxes payable

1,476

515

Non-operating profit

Provision for bonuses

871

956

Interest income

24

63

Other

3,930

3,781

Dividend income

44

61

Total current liabilities

20,184

17,890Capital return using equity method

Lease obligations

Non-current liabilities
Long-term loans payable

Foreign exchange gains (losses)
1,600

4,600

Lease obligations

259

427

Deferred tax liabilities

123

105

Net defined benefit liability

368

402

Long-term accounts payable

66

Total non-current liabilities

2,357
22,541

Total liabilities

Other

73

164
1,808

Interest expenses

51

112

Share of loss of entities accounted for using equity method

－

688

5,541

Commission expenses

16

28

23,431

Share acquisition rights issuance costs

18

－

Other

16

42

Non-operating expenses

Shareholdersʼ equity

Total non-operating expenses

103

873

6,529

5,675

Gains on liquidation of subsidiaries－

10

Gain on sales of non-current assets

2

6Gain on sales of investment securities

2

22

Total extraordinary profit

4

40

Loss on retirement of non-current assets

73

41

Capital stock

7,819

7,819

Capital surplus

Ordinary profit

7,804

7,804

Retained earnings

Extraordinary profit

25,95028,001-634-634

40,93942,990430645Foreign currency translation adjustment

2,635

3,506

Remeasurements of defined benefit plans

267

13

Total valuation and translation adjustments

Loss on sales of non-current assets

1

2

3,332

4,165

Loss on sales of investment securities

0－

Treasury stock
Total shareholdersʼ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities

Non-controlling interest
Total liabilities and net assets

Extraordinary losses

56

68

Business restructuring expenses－

220

44,32847,224Compensation payments－

153

66,87070,656

Impairment losses－

863

Total extraordinary losses

74

1,281

Profit before income taxes

6,459

4,433

Income taxes - current

2,027

1,490

Income taxes - deferred

(240)

(209)

Total income taxes

1,786

1,280

Profit

4,673

3,153

Profit (loss) attributable to non-controlling interests
Profit (loss) attributable to owners of parent

57

Yokowo 2023 Integrated Report

－
1,519

1,948

Total non-operating profit

NET ASSETS

Total net assets

42
1,763

9

6

4,663

3,147

Yokowo 2023 Integrated Report58Appendix

CONSOLIDATED STATEMENTS OFCOMPREHENSIVE INCOMECONSOLIDATED STATEMENT OFCHANGES IN EQUITY(millions of yen)

Fiscal 2021
(From April 1, 2021
to March 31, 2022)

Fiscal 2022
(From April 1, 2022
to March 31, 2023)

4,673

3,153

Valuation difference on available-for-sale securities

(112)

214

Foreign currency translation adjustment

1,795

877

Remeasurements of defined benefit plans

(170)

(253)

Total other comprehensive income

1,512

838

6,185

3,992

6,170

3,979

14

12

ProfitOther comprehensive income

Comprehensive income(Comprehensive income attributable to)Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

Fiscal 2021 (From April 1, 2021 to March 31, 2022)(millions of yen)

Shareholdersʼ equity
Capitalstock
Balance at beginningof period

6,387

Capitalsurplus

6,373

Cumulative effectof change inaccounting policy
Balance at beginning of
period, reflecting changein accounting policy

Accumulated other comprehensive income

Retainedearnings

Treasury
stock

Total
shareholdersʼ
equityValuationdifference on
available-forsale securities

22,199(633)

34,326

543

(51)
6,387

6,373

Share
Foreignacquisition Noncontrolling Total net
interests
assetscurrency Remeasurements Total valuationrightsofdefinedandtranslationtranslation
adjustments
adjustment benefit plans

845

437

1,825

8

41

36,202(51)

22,147(633)

34,274

(51)
543

845

437

1,825

8

41

36,150Changes during period
Dividends ofsurplusIssuance of newshares(exercise of shareacquisition rights)

(860)
1,431

1,431

Profit (loss)
attributable toowners of parent

4,663

Purchase oftreasury shares

(1)

(860)

(860)

2,862

2,862

4,663

4,663

(1)

(1)

Disposal oftreasury shares
Net changes of
items other thanshareholdersʼ equity

1,431

1,431

3,802

(1)

Total changes of
items during period

7,819

7,804

25,950

(634)

(112)

1,789

(170)

1,507

(8)

14

1,513

6,664

(112)

1,789

(170)

1,507

(8)

14

8,177

40,939

430

2,635

267

3,332

－

56

44,328

Fiscal 2022 (From April 1, 2022 to March 31, 2023)(millions of yen)

Shareholdersʼ equity
Capitalstock
Balance at beginningof period

7,819

Capitalsurplus

7,804

Accumulated other comprehensive income

Retainedearnings

Treasury
stock

Total
shareholdersʼ
equityValuationdifference on
available-forsale securities

25,950(634)

40,939430

Foreign currency Remeasurements Total valuationtranslationof defined
and translation
adjustment
benefit plansadjustments

2,635

267

3,332

Noncontrollinginterests

Total net assets

56

44,328Changes during period
Dividends of surplus(1,095)(1,095)(1,095)

Profit (loss)
attributable toowners of parent

3,147

3,147

3,147

(0)

(0)

Purchase of treasury
shares（0)

Net changes of
items other thanshareholdersʼ equity

59

Yokowo 2023 Integrated Report

214

871

(253)

832

12

844

Total changes of
items during period

－

－

2,051

(0)

2,051

214

871

(253)

832

12

2,896

Balance at end of period

7,819

7,804

28,001(634)

42,990

645

3,506

13

4,165

68

47,224

Yokowo 2023 Integrated Report60Appendix

CONSOLIDATED STATEMENT OF CASH FLOWS

Independent Practitionerʼs Assurance Report(millions of yen)

Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment losses
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in net defined benefit asset and liability
Interest income and dividend income
Interest expenses
Foreign exchange losses (gains)Share of loss (profit) of entities accounted for using equity method
Loss (gain) on sales of non-current assets
Loss on retirement of non-current assets
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Decrease (increase) in trade receivables
Increase (decrease) in trade payables
Other
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Payments for short-term loans receivable
Proceeds from sales of investment securities
Proceeds from withdrawal of time deposits
Purchase of shares of subsidiaries and associates
Payment for outgoings for capital investments
Long-term loan advances
Proceeds from long-term loans receivable
Other
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Net increase (decrease) in short-term borrowings
Proceyeds from long-term loans payable
Repaments of long-term loans payable
Proceeds from issuance of shares
Repayments of lease obligations
Proceeds from exercise of employee share options
Proceeds from issuance of exercise of share acquisition rights
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

61

Yokowo 2023 Integrated Report

Fiscal 2021
(From April 1, 2021
to March 31, 2022)

Fiscal 2022
(From April 1, 2022
to March 31, 2023)

6,459
3,302
－
4
181
(33)
(69)
51
(320)
(42)
(0)
73
(2)
(612)
(4,190)
(100)
338
5,039
69
(52)
(1,378)
3,677

4,433
3,833
863
(3)
79
(119)
(124)
112
(663)
688
(4)
41
(22)
1,538
2,263
(2,652)
(468)
9,795
124
(105)
(2,501)
7,312(4,739)
19
(530)
(20)
－
2
175
(287)
(500)
－
－
(86)
(5,967)(4,645)
71
(591)
(105)
(80)
32
－
(525)
－
(70)
10
45
(5,857)300
1,600(3,400)
2,853
(322)
(858)
(1)
171
640
(1,478)15,295
13,816

－
3,000
－
－
(374)
(1,093)
(0)
1,531
882
3,870
13,816
17,687

Yokowo 2023 Integrated Report62

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Tokyo 101-0041, Japan
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