Corporate Report 2021

2-11, Kanda Nishiki-cho, Chiyoda-ku
Tokyo, 101-0054 Japan
Tel: +81-3-3518-1111
Fax: +81-3-3518-1230
https://www.sanyo-trading.co.jp/english/
Date of issue: February 11, 2022

Mission

Sanyo Trading Co., Ltd.’s philosophical framework (shown on the right) indicatesthe values shared throughout the Company. The framework breaks down our
mission, from the Management Mission, which is the overarching concept, to the
Credo, which provides guidelines for our business activities. Our Slogan, shown
below, sums up our approach. This framework guides all employees of Sanyo
Trading Co., Ltd. as they work to fulfill the Company’s mission.

Management
MissionValue and significanceas a company

With an unwavering and enterprising spirit, and a free and open
corporate culture, we will supply the best solutions in a flexible
and timely fashion, working to realize a process of “co-creation”
by which we contribute both to the sustainable development of theinternational community and the happiness of our employees.
Industrial Products
No.1 & No.2 Business Unit

Rubber Business Unit

Business
MissionBusiness mission
and values

SloganCredo

The Slogan expresses our philosophical framework, which starts with the Management Mission, in asingle phrase. We are a complex and specialized trading company tasked with resolving social
issues through the provision of various products and technologies. To that end, we will always work
to find the BEST solution for our customers. We also need to constantly “challenge ourselves” to findthe BEST solution. We must pursue the BEST solution by not only utilizing our existing knowledge
and resources, but also by flexibly expanding our ideas to new fields and technologies.

Guidelines forbusiness activities

With the trust that we have won and theresults that we have achieved over thecourse of our history as a foundation, we
will contribute to the development of the
global rubber industry through a pioneering
spirit and timely services.

Chemical Business Unit
Through the provision of the best solutions
based on wide-ranging technologicalknowledge and niche specialty products, inaddition to the active pursuit of investment
initiatives, we will contribute to thedevelopment of the fine chemicals field.

Working agilely and with sure knowledge,
we will utilize our just-in-time system toprovide our customers with advanced
technologies able to transform society,thereby contributing to social developmentwith a focus on the mobility field.

Machinery & Environmental
Business Unit
We will contribute to food safety and theadvancement of renewable energies by
seeking out and supplying the best
technologies and equipment from aroundthe world in the powder processing andwoody biomass fields.

Life Science Business Unit
We will contribute to improving people’squality of life (QoL) and realizing anenvironment-friendly society by providing
materials and scientific instruments that
contribute to the development of a wide
range of industrial fields including healthcare,food, chemicals, and the environment.

Integrity

We comply with laws and regulations, and act with integrity

Spirit of challenge

We aim towards a future of development and creativity

Speed

We make decisions and act on them quickly and accurately

Innovation

We understand the trends of the times and anticipate change

Contents
1	
1 Mission / Slogan / Management Mission / Business Mission / Credo

Our Initiatives for Value Creation

Foundations of Our Value Creation2

Progress in Business Growth

6

Top Message

14

4

At a Glance / Materiality

8

Long-Term Management Plan / Business Portfolio

Editorial Policy

16

Corporate GovernanceRubber Business Unit

19

ComplianceThis report aims to inform a wide range ofstakeholders about the management
status, business overview and external
environment of the Company and the
Sanyo Trading Group, from financial andnon-financial perspectives.

10

Chemical Business Unit

20

SocialReporting Scope

11

Industrial Products No.1 & No.2 Business Unit

22

Environment

12

Machinery & Environmental Business Unit

Sanyo Trading Co., Ltd. (“the Company”)
and its consolidated subsidiaries(“the Sanyo Trading Group”)

13Life Science Business Unit

	  9Corporate Officers

Company Information
24

Financial Highlights

25

Corporate Data / Stock Information

Regarding ForwardLooking Statements
Forward-looking statements in this reportare based on forecasts made by theCompany in light of information available
at the time of writing, and involve a
number of risks and uncertainties. Actual
business results may differ substantiallyfrom the forward-looking statements andforecasts in this report.

Reporting Period
October 1, 2020 to September 30, 2021
(Please note that this report includes information
regarding the results of activities outside thereporting period.)

SANYO TRADING Corporate Report 2021

1

Progress in Business Growth

Overseas Group companies

Net sales (fiscal year ended September 2021)

89,788 million yen

Since its establishment in 1947, Sanyo Trading Co., Ltd. has been continuously
guided by a spirit of challenge. We have expanded the regions in which we dobusiness not just within Japan but throughout the world. Our operations now
span four locations in Japan and include 17 overseas Group companies. We
continue to pass down our spirit of challenge, cultivated over a history of morethan 70 years, to each new generation of employees—it is this spirit that is thedriving force of the Group’s development and growth.

(Millions of yen)

100,000

80,000In 2018, we renewed our Mission and Slogan, and embarked on a new era.
We will continue to pursue “finding the BEST solution for our customers.”

60,00040,000Net Sales
20,000

0
1947

1950

1955

1960

1965

1970

1975

1980

1985

1990

Founding Period (1947–1954)

Business Diversification (1955–1964)

Solidifying the Group Structure (1965–1996)

Began establishing group structure● 
Established North American
subsidiary, began overseas sales●	S pan off Scientific Instruments Business Unit

● E stablished industry position

through the import and exportof synthetic rubbers and otherbusinesses (Polysar Limited)● B egan chemical pesticide sales

1996

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011



1964

1973

1990

Completed Sanyo Tradingbuilding; transferred
headquarters from Kobe
to Tokyo

Established Sanyo
Machinery Co., Ltd.

Established representative
office in Hanoi

1988

Established representative
office in New York

Established representative
office in Bangkok

Launched automobile
parts business

1992

2006

2008

Established Sanyo
Trading (Shanghai) Co.,
Ltd. in China

Established Sanyo
Technos Co., Ltd.

Completed new
headquarters building

Began capital participationin Chem-Inter Corporation

2010
Established representative
office in New Delhi, India

1994
Established representative
office in Detroit

2013
Established Sun Phoenix Mexico
S.A. de C.V. in Mexico

2

2021

2016
Sort Co., Ltd. and Nihon RufutoCo., Ltd.

2017

Established PT. Sanyo Trading
Indonesia in Indonesia

Freeman (Japan) Co., Ltd.

2017
Established representative office in
Düsseldorf, Germany

Synthetic rubbers(Polysar Limited)

Execution of M&A

2014

2015

1948

SocialSituation

2020

Acceleration of Global Expansion

Began capital participation in Bestrade
Precision Singapore Pte. Ltd.
(now Singapore Sanyo Trading Pte. Ltd.)

Established Tokyo Branch

2019



2003

Made Cosmos Shoji Co.,
Ltd. a subsidiary2018● B egan handling environmentally friendly materials

2004

Established representative
office in Ho Chi Minh City2017

● E xecuted M&A● Transitioned to business unit organization

1959
Established Nagoya
Branch2016

(systemization and management functions)

Established Osaka Branch2015● A ccelerated globalization (North America, China and ASEAN)● L aunched automobile parts business



1952

2014

● L isted on Tokyo Stock Exchange, First Section

withdrew from agricultural and fisheries business● Reinforced internal management system

Sanyo Trading Co., Ltd.
founded by members of theKobe branch of the former
Mitsui & Co., Ltd. following thezaibatsu dissolution.
Headquarters in Kobe andstarting capital of 195,000 yen.

2013

To the Next Stage (2012 onward)● E xecuted decisive business reorganization,

profitability of core businesses

1947

2012

Selection and Concentration (1997–2011)● E xpanded business scale by reinforcing

and products related toagriculture and fisheries, etc.

1954

1997

from the Chemical Business Unit

● B egan sales of feed equipment(Rohm & Haas Company)

1995

2019
YPTECH Co., Ltd.

2021
Established Life Science Business Unit

1955–

1973

1986

1991

2008

2012–

2020–

High economic growth period

First oil crisis

Bubble economy period

Burst of bubble economy

Global financial crisis

Abenomics economic policies

COVID-19 pandemic

SANYO TRADING Corporate Report 2021

SANYO TRADING Corporate Report 2021

3

At a Glance / Materiality
Consolidated Financial Highlights

Non-Financial Highlights

Operating Income / Operating Income Ratio(Millions of yen)

7,000

7.3

7.1

6.7

6.3

Earnings Attributable to Owners of the Parent / ROE(%)(Millions of yen)

8

5,000

15.2

(%)

14.5

14.5

13.1

6.1

16

(Employees)

(%)

(%)

500

70

100

10.1
3,500

5,263

4,938

5,871

4,791

5,506

0

4

2,500

3,351

0

9/17

9/18

9/19

9/20

9/21 (FYE)

61.1

38,98741,60625,00024,60043,731

64.9

67.5

31,03826,756 29,343

9/20

9/21 (FYE)(%)(Times)

70

0.16

33

33

35

35

193

211

224

234

241

9/17

9/18

9/19

9/20

34,725

9/19

9/20

35

50

0

0

9/21 (FYE)

0.15

85

96

100

100

100

100

100

100

100

100

100

9/18

9/19

9/20

9/21 (FYE)● Childcare leave utilization rate (non-consolidated)● Rate of return to work after childcare leave (non-consolidated)

Retention Rate of New Graduate Employees /Turnover Rate
(%)

100

9/17

■ Number of employees (consolidated) (left scale)■ Number of employees (non-consolidated) (left scale)● Ratio of female employees (consolidated) (right scale)

100

100

75

33

326

0

D/E Ratio

Electricity Consumption (Non-Consolidated)
（%）

(MWh)

900

67
35

0.08

0.07

450

50

0.07

0.07

617

0.05

0

9/18

9/19

413

368

47,230 50,834

0

9/17

9/18

442

349

3,013

■ Earnings attributable to owners of the parent (left scale)● ROE (right scale)

66.2

63.5

250

8

0

9/17

Total Assets / Net Assets / Equity Ratio

50,0004,018

0■ Operating income (left scale)● Operating income ratio (right scale)(Millions of yen)

3,635

4,256

Childcare Leave Utilization Rate /Rate of Return to Work after Childcare Leave(Employees)

Number of Employees / Ratio of Female Employees

2.4

4.0

3.4

7.1

9/17

9/18

9/19

9/20

9/21 (FYE)

9/17

9/18

9/19

9/20

9/21 (FYE)

895

887

872

9/19

9/20

9/21 (FYE)

0

0

0

9/21 (FYE)

6.7

761

9/17

9/18

● Retention rate of new graduate employees (non-consolidated)● Turnover rate (non-consolidated)■ Total assets (left scale) ■ Net assets (left scale)● Equity ratio (right scale)

Retention rate of new graduate employees= Ratio of employees still employed by the Company as of reference date among new
graduate employees who joined the Company during the preceding three-year period
Turnover rate = Number of employees who left the Company over one-year period since
start of year ÷ Total number of employees at start of year

To determine our material issues, we evaluated impact on
stakeholders while referencing the SDGs (covering many social
issues), action plans issued by the Japanese government andthe evaluation items of an ESG ratings agency.

Very highMaterial Issues for Achieving Sustainable Development (Materiality)
Material Issue

Overview

Main Initiatives

Initiatives for environmentalload reduction

Transition from petroleum-derived
materials to environmental load-reducing
materials and naturally derived materials• Non-phthalate plasticizers• Carbon black derived from biomass• Materials for UV ink and UV coating

Initiatives to address
climate change

Contributing to a sustainable society byproviding services and products related
to renewable energy• Sales and maintenance of woodpellet gasifiers with combined heatand power (CHP) plants• Supply of geothermal development
machines

Contribution to the
procurement of scarce
resources

Contributing to the establishment oftechnologies for extraction of rare earth
elements through the lifting and recovery
method•P rocurement and supply of pipes forlifting and recovery, and buoyancy
bodies for trial demonstrations to lift
and recover rare earth elements

Enhancing workplaceenvironments

Further improving education systems andworkplace environments• Revision of personnel system• Overseas training system• Establishing a system for remote work
• Universal Manners Test

Reinforcing corporate
governanceReinforcing corporate governancesystems• Establishing corporate governancesystems• Increasing the ratio of Outside
Directors to more than one third• Establishing the Nomination andCompensation Committee

Material issues
Process for Determining Materiality

Extraction and organization of candidates
for materiality items
STEP 2

Evaluation from the perspectivesof the Company and stakeholders
STEP 3

Determination of materiality items

4

SANYO TRADING Corporate Report 2021

Impact on stakeholders

STEP 1

Impact on the Group’s business

Very high

SANYO TRADING Corporate Report 2021

5

Our Initiatives for Value Creation

Top Message
Sanyo Trading’s Management Mission is “With anunwavering and enterprising spirit and a free and open
corporate culture, we will supply the best solutions in a
flexible and timely fashion, working to realize a process of‘co-creation’ by which we contribute both to the sustainable
development of the international community and thehappiness of our employees.” With this mission in ourhearts and the goal of becoming a company with a
100-year history, we will continue serving our customers
and society while further developing our capabilities.

Masanobu Shintani

President & CEO

history reflects the strengths of our company, and among those strengths is the solid financial
foundation built through the efforts of our predecessors. No matter the situation, corporations have a
responsibility to ensure the continuity of their business activities. To that end, as President & CEO
I believe I have two vital roles to play: (1) indicate and implement a clear direction and policy forsteady growth, and (2) embrace and maintain the foundations of our core businesses.
The priority business fields we will focus on are mobility, fine chemicals, life sciences and sustainability.
The first vehicles with internal combustion engines were developed around 1900. More than a century
has passed since then and such vehicles are being gradually replaced with electric vehicles (EVs).
Our mobility business will meet the needs of this shift. Moreover, we expect higher-than-everdemand in the fine chemicals and life sciences business fields, including for environmentally friendly
products and products that enable people to maintain and improve their health. Finally, we havepositioned sustainability as a priority business field in the belief that we should steadily contribute to
the environment and sustainable development in whatever ways we can. Specifically, we are alreadydeveloping products related to power generation from renewable energy sources as well as rareearth mining, through which we will help achieve the SDGs and establish a circular society. We
believe that when making a proposal to our customers, it is important to consider not only theircurrent situation, but to also thoroughly consider their future, and propose the best solution flexibly
and speedily.

See also

Page 8Long-Term
Management Plan /Business Portfolio

Our ESG Initiatives

See also

Pages 2–3

Progress in
Business GrowthCharacteristics and Strengths of Sanyo Trading
Sanyo Trading was established by members of the Kobe branch of the former Mitsui & Co., Ltd.
following its dissolution in 1947 by GHQ.* In the immediate post-war period, we set out to importhigh-quality products in order to play our part in supporting the revitalization of Japan. As part ofthose efforts, we became the first company in Japan to import synthetic rubber. Since that time wehave steadily developed our businesses. While the products we have handled are numerous, foreach product we designate only one supplier from which we purchase that product. This is one ofour basic policies, and in strictly following this policy we have forged relationships of trust with
suppliers over the course of our 75-year history. Many of our suppliers have been doing businesswith us for as long as 40 or 50 years, and with their support we are able to challenge ourselves tofind and provide the best solution according to customer needs. I believe that this is one of our mostnotable characteristics and strengths.
In reconsidering our mission, we adopted “Challenging ourselves for the BEST solution” as our
Slogan to sum up our Management Mission. However, we must do more to ensure our
employees truly understand the Management Mission and Slogan. As such, we are providing our
employees around the globe with a variety of opportunities to improve this understanding,including through day-to-day conversations, in-house training and internal media.

A trading company cannot exist without its people. Our growth as a company is the total sum of thegrowth of our employees. Today, many companies are pursuing work style reforms, and at Sanyo
Trading we are working to create environments where all employees can make the most of theirabilities. We have introduced a remote working system as one measure to combat the current
pandemic. We also established Kaeru College as an in-house training system. Instead of thinking
about “who owns a company,” when we thought about “for whom does a company exist,” wenaturally concluded that employees are a company’s driving force. Given employees’ role insupporting Sanyo Trading’s growth, we believe that investing in employees is essential and as such
we will continue to implement various measures.
Regarding the importance of addressing climate change, we have already started discussions
through a variety of internal meetings. Such discussions also include how to reflect therecommendations of the Task Force on Climate-Related Financial Disclosures (TCFD). We will review
our existing climate change initiatives, such as the sale of environmentally friendly products andwoody biomass from unused forest thinnings in Japan. Nevertheless, recognizing the need to makeeven further efforts, we will select appropriate products while applying the unique perspective
afforded us as a trading company, which is distinct from that of manufacturers.
Among our corporate governance initiatives, we have been expanding the functions of Outside
Directors and have established a Nomination and Compensation Committee. We expect the numberof subsidiaries in Japan and around the globe to increase with the growth of the Sanyo TradingGroup, which will require the continuous enhancement of governance at a group level. To that end,
all Group companies will work together with the spirit of “One Sanyo.”

Pages 20–21

SocialPages 22–23

Environment*GHQ: General Headquarters, the Supreme Commander for the Allied Powers

Recognition of the External Environment
and Overview of the Fiscal YearThe world is now in an age of innovation. We cannot expect to achieve long-term growth without
clearly defining what kind of company we want to become, the direction we are headed, ourpositioning and our goals. However, we must also remember that even when we have set high goals
and work toward them, crises such as the COVID-19 pandemic are beyond our control. Our long

6

SANYO TRADING Corporate Report 2021

To Our Shareholders and Stakeholders
Our shareholder return policy is centered on increasing the dividend per share over the medium tolong term, thereby ensuring stable long-term shareholder returns. Our businesses are fundamentally
B-to-B, so our name may not be as well-known as those of B-to-C companies. However, we believethat the contributions only a B-to-B company can make to its customers will eventually benefit
end-users, and society as a whole. We invite our shareholders and stakeholders to look forward tofurther social contribution and enhancement of our corporate value over the medium to long term.

SANYO TRADING Corporate Report 2021

7

Our Initiatives for Value Creation

Long-Term Management Plan / Business Portfolio

Rubber Business Unit
A Central Role in Supply and Import/Export for the Rubber Industry in Japan and around the World

Sanyo Trading aims to be a company that increases added value and establishes a presence in niche markets byproviding the best solutions for its customers. VISION 2023 is our long-term management plan for ensuring business
continuity as a healthy company, with the fiscal year ended September 2023 as the plan’s final milestone year. With theManagement Mission as our guide, we will put our Slogan, Business Mission and Credo into practice, and pursue
continuous enhancement of corporate value.

Long-Term
Management Plan
VISION 2023
Management
MissionStrategy A

Challenging ourselves for the BEST solution
We will build a corporate structure that enables us to challenge ourselves
for the BEST solution, as stated in our Slogan, under the Management
Mission, Business Mission and Credo.

Strategy B

Strengthening the Company’s foundation
Maintaining a free and open corporate culture, a flexible organizational
structure and compliance with laws and regulations, we will apply IT,
advance ESG activities and strengthen the financial base.

Strategy C

Investing in human resources
We will increase investment in human resources by enhancing educationand training, including the establishment of various new training programs,by flexibly utilizing diverse human resources and by making transfers thattake into account career development.

Strategy D

Enhancing business in certain fields
We will pursue and enhance high-value-added business in niche areas inaddition to our core business fields.

Strategy E

Developing new businesses
We will launch projects to promote new businesses in which we canachieve a certain level of results by 2023.

Strategy F

Accelerating globalization
We will accelerate globalization, making our bases in the USA, China andThailand hubs. We aim to achieve annual growth of 10% at overseas bases.

Strategy G

Advancing new investment projects
We will promote investment in projects that are related to the Company’s
current business fields and can be expected to contribute to (i) synergies
with existing businesses, (ii) future growth, and (iii) globalization.

Purpose
1. Group that rises to challenges
and provides the best solutions
2. Continuous earnings growth

Basic strategies
Strengthening thecorporate structure
Challenging ourselves

Strengthening theearnings baseEnhancing business in

A for the BEST solution

D certain fields

B Strengthening theCompany’s foundation
C Investing in humanresources

E Developing new businesses
F Accelerating globalization
Advancing new investment
G projects

Business Portfolio

Chemicals Segment(Results for the fiscal year ended September 2021)
Rubber Business Unit

Domestic Subsidiaries
Chem-Inter Corporation,
Sanyo Life Material Co., Ltd.

Chemical Business Unit
Net Sales

89.7 billion yen

Life Science Business Unit*
Material Solutions Department

The Rubber Business Unit became the sole agent of Polysar Limited of Canada (present ARLANXEO)
in 1952, which made us the first company to introduce synthetic rubber and its processing
technologies on a full scale in Japan. Since then, we have served as one of the main distributors ofvarious synthetic rubbers and auxiliary materials produced in Japan and overseas, and contributed tothe development of the domestic rubber industry. Moreover, each year we have expanded the variety
of raw materials we sell to Japan-based companies overseas. Also, in response to changes in market
demand, we have been expanding our product lineup of high-performance fillers made in Japan andoverseas, as well as sales of next-generation materials such as environmentally friendly plasticizers,
plant-derived fillers, and epoxidized natural rubbers.

External Environment and Future Outlook

Yasushi Komiya
Executive Officer and Rubber Business Unit, General Manager

In the fiscal year ended September 2021, demand for raw
materials had rapidly recovered in many industries including
the automobile industry. Meanwhile, the supply of imported
materials, especially those from Europe and the USA,further tightened and prices soared. As such, the external
environment changed dramatically during the fiscal year.
Global sales of our core products sharply recovered, salesof high-performance fillers such as heat dissipation additives
expanded rapidly, while environmentally friendly materials
have also been receiving increased attention. Materials
imported from Thailand and the USA are receiving
consideration and being adopted for new applications.
Namely, epoxidized natural rubber that is an alternative toconventional synthetic rubber and is the main raw materialof new alternative materials to leather (i.e., vegan leather),and carbon derived from woody biomass that is analternative to conventional petroleum-derived carbon black.
In our future outlook, we expect accelerated expansion ofsales of synthetic rubbers such as ethylene propylene dienemonomer (EPDM) rubber produced by ARLANXEO, a top

Machinery & Industrial Products Segment
Industrial Products No.1 Business Unit
Industrial Products No.2 Business Unit

Operating Income

5.5 billion yen

Machinery & Environmental Business Unit

Domestic Subsidiaries
Cosmos Shoji Co., Ltd.,Sanyo Machinery Co., Ltd.,YPTECH Co., Ltd.,
Nihon Rufuto Co., Ltd.,
Freeman (Japan) Co., Ltd.

Life Science Business Unit*
Scientific Instruments Department

global manufacturer of synthetic rubbers, especially to
Japan-based companies overseas. Our rubber molding
manufacturing customers in Japan are accelerating theirshift to new mass-production sites overseas, including otherparts of Asia. In response to this trend, we have posted
more employees to overseas subsidiaries. We expect thisinitiative to lead to faster information sharing with our offices
in Japan, improved response to customer needs and amore stable supply of products.

Epoxidized natural rubber

Plant-derived filler CarbonNeat

Main Trading Products▶ Synthetic rubbers of ARLANXEO (NBR, PNBR, HNBR, IIR,

H-IIR, EPDM, EVM, CR, etc.)▶ Functional synthetic rubbers including silicone rubber,
fluororubber, epichlorohydrin rubber, acrylic rubber, ethylenepropylene rubber, etc.
▶ Environmentally friendly plasticizers (LANXESS AG, Germany)▶ Functional inorganic fillers (KaMin LLC, USA; Huber Engineered

Materials, USA; and Nippon Steel Chemical & Material, Japan;etc.)▶ Carbon derived from woody biomass (CarbonNeat, USA)▶ Other products include additives related to rubber and resin, as
well as various equipment

Overseas Subsidiaries Segment
Chemicals Segment
Machinery & Industrial Products Segment
Overseas Subsidiaries Segment
8

SANYO TRADING Corporate Report 2021

USA, Mexico, China, Thailand, Vietnam and Indonesia* As of October 1, 2021, due to organizational changes, the Scientific Instruments Business Unit was
reorganized as the Life Science Business Unit, and part of the business of the Chemical Business
Unit was transferred to the Life Science Business Unit.

SANYO TRADING Corporate Report 2021

9

Chemical Business Unit

Industrial Products No.1 & No.2 Business Unit

The Sale of High-Performance Products and Provision of High-Standard Services in the Field of Fine Chemicals

Developing, Importing and Selling High-Value-Added, High-Performance
Parts and Components for Automotive Seating and Interiors

The Chemical Business Unit is involved in the import, domestic sales, export and trilateral trade ofhigh-value-added chemicals. We develop products for growing markets, which in recent years haveincluded the medical, energy and environmental markets. In our import business we handle various
high-quality resins, additives and other functional chemicals and sell them to customers including paintand ink manufacturers.
Furthermore, we have built close and solid relationships of trust with dozens of major chemical
suppliers across North America, Europe and Asia. While importing various fine chemical products, we
also gather information from our suppliers on overseas technology development trends and market
trends, and provide this information to our customers.

The Industrial Products Business Unit conducts sales of high-performance parts and components
for automobile seating and interiors. Our diverse product lineup includes components for seatheaters and seating air conditioning systems, lumbar supports, seat adjuster motors, seat
sensors and genuine leather products used in automobile seats. In recent years, we also handle
non-destructive scanning data of automobiles as well as gas springs, thus adding high value toautomobiles in a variety of ways.

External Environment and Future Outlook

External Environment and Future Outlook

Naoki Tanahashi
Senior General Manager and Chemical Business Unit, General Manager

In the fiscal year ended September 2021, we received
many inquiries from a variety of industries regarding raw
materials. Among our core products related to paints andinks, sales of raw materials for environmentally friendly
UV ink were strong. We also began trading various newly
developed products and expanded the scope of ourbusiness over the year. Products included naturallyderived, environmentally friendly products made by
Perstorp Holding AB (of Sweden) using renewable energy.
From October 2021, regulations on perfluorooctanoic
acid (PFOA) were tightened. PFOA is used as a raw
material for various products including surfactants, but
contains specified chemicals that are restricted forconventional usage. We handle polytetrafluoroethylene(PTFE), a regulation-compliant alternative with far
less PFOA content. We propose this and other moreenvironmentally friendly alternatives to our customers,
many of whom adopt such products. We will continue

expanding our business mainly through the sale ofenvironmentally friendly products.

Main Trading Products▶ Fine powder waxes for paints and inks; cosmetics; lubricants;

waxes for engineering plastics (Shamrock Technologies, USA)▶ Plasticizers for polyvinyl chloride and rubber (HallStar, USA)SANYO TRADING Corporate Report 2021

Akira Watanabe

Industrial Products No.1
Business Unit, General Manager

Industrial Products No.2
Business Unit, General Manager

In the fiscal year ended September 2021, Japan-based
automobile manufacturers maintained a high level ofproduction, and demand for our core products—
components used in automobile seating and related
equipment—greatly increased. However, from thesummer onward we were affected by the production
adjustments of automobile manufacturers due to ashortage of parts such as semiconductors. We also feel
it is necessary to keep an eye on issues such asincreasing logistics costs and US–China trade friction.
Nevertheless, our new automated lock-releasemechanism (latch release actuator) was adopted by aJapanese automobile manufacturer for luxury models.
We have started working toward mass production anddelivery, and will focus on increasing the number ofmodels that use this product and promoting sales toother automobile manufacturers.
We expect the shift to electric vehicles to continue. For
the interior components we handle, we believe companies
will demand high performance and high functionality inorder to create a comfortable “living space.” We will work
to swiftly respond to new needs in Japan and overseas. In
January 2021, we opened a new office in Alabama, USA,through which we will respond in a timely fashion to thestart of operation of a new plant operated by Japanese
automobile manufacturers.

Seat sensor

Lumbar support

Leather for seating

Seat heater

Main Trading Products▶ Clays for paints and inks (KaMin LLC, USA)▶ Seat heaters (Gentherm Incorporated, USA)▶ Genuine leather for automobiles (Pangea Made, USA)

▶ Thiocyanate; cellulose thickeners (Nouryon, Netherlands)▶ Seat sensors (IEE S.A, USA)▶ Gas springs (SUSPA, Germany)▶ Flame retardants (ICL, Israel)▶ Lumbar supports (L&P Automotive Group, USA)

Affiliated Companies

10

Rintaro Harada▶ Benchmarking services (Caresoft Global, USA)

Freeman (Japan) Co., Ltd.

SANYO TRADING Corporate Report 202111

Machinery & Environmental Business Unit

Life Science Business Unit

Promoting Food Safety and Renewable Energy in Japan

Improving People’s Health and Quality of Life (QoL), and Achieving an Environmentally Friendly Society

The Machinery & Environmental Business Unit comprises the Powder Processing Group, theBiomass Group and other groups. We introduce outstanding overseas technologies to Japan infields relating to powder processing, including food, feed and fertilizer, and pelletizers for woody
biomass. Among our subsidiaries, Cosmos Shoji Co., Ltd. handles equipment for developing
marine rare earth elements and YPTECH Co., Ltd. provides functional feeds. As such, the entire
business unit is promoting food safety and renewable energy in Japan.

The Life Science Business Unit was newly established in October 2021, and comprises theMaterial Solutions Department and the Scientific Instruments Department. The Material Solutions
Department handles export/import and sales, trilateral trading of high-value-added chemicals,such as food additives and raw materials for cosmetics, and materials that contribute to thedevelopment of a wide range of industries, such as electronic materials and high-performancefilms. The Scientific Instruments Department imports analysis, testing and medical equipmentfrom overseas manufacturers that possess cutting-edge technologies, and provides totalsolutions tailored to the needs of a wide variety of customers, including government agencies.

External Environment and Future Outlook

External Environment and Future Outlook

Yoshifumi Oyabu

Koji Taguchi

Machinery & Environmental Business Unit, General Manager

Life Science Business Unit, General Manager

In the fiscal year ended September 2021, due to proactive
capital investment by domestic feed manufacturers, sales ofimported granulators for feed processing (pellet mills) andancillary maintenance services performed strongly. While
several projects were affected by issues such as the soaring
price of wood due to the current lumber crisis, for woody
biomass combined heat and power (CHP) plants, which
gasify pellets made from unused forest thinnings in Japan,
we delivered six plants to Tobetsu-cho, Hokkaido.
Furthermore, subsidiary Cosmos Shoji Co., Ltd.
supplied equipment to a project for lifting and recoveryof rare earth elements of the Cross-ministerial Strategic
Innovation Promotion Program (SIP) led by Japan’s
Cabinet Office. This project aims to establish thetechnology for lifting and recovery of rare earth elementsfrom the sea bed at a depth of up to 6,000 meters, andto that end we will also work to procure submersible
dredging machines and other equipment. Meanwhile,
we are actively making proposals to feed manufacturers

for ways to improve production efficiency, work safety andpellet feed quality. We are also proposing solutions forfunctional feed additives in conjunction with subsidiary
YPTECH Co., Ltd. Through our contributions to theJapanese livestock industry, we aim to support therealization of a sustainable society.

Pellet mill

Wood pellet gasifier
with CHP plant©JAMSTEC. Equipment fordeveloping marine resources

In the fiscal year ended September 2021, there was highglobal demand for materials and equipment in the life
science field. Even under the COVID-19 pandemic,
businesses that showed firm growth included sales ofwater absorption resin in North America, export ofelectronic materials to South Korea, export of films to
North America, sales of surface property analyzers, andsales of tribology-related equipment.
Inhaler testing equipment—used to test delivery andparticle size of inhalers used for treating asthma, influenza
and pulmonary hypertension—saw vigorous demandduring the pandemic. Given that the societal aging is
expected to continue, we will provide solutions in areas
such as innovative materials, equipment and services toimprove people’s health and QoL and achieve an▶ Surfactants (Dow, USA)▶ Food additives (taurine, organic acids, etc.)▶ Pharmaceutical ingredients (drug precursors and intermediates)▶ Hot melt products (glue guns, applicators, adhesives)▶ Pellet mills (CPM, US)▶ Wood pellet gasifiers with CHP plants (Burkhardt, Germany)▶ Cosmos Shoji: Equipment for developing geothermal power,

equipment for developing marine resources▶ YPTECH: Palm oil fatty acid calcium, oil cake made fromenzymatically treated and peeled soy, active yeast

Affiliated Companies

12

Sanyo Machinery Co., Ltd.
Cosmos Shoji Co., Ltd.

SANYO TRADING Corporate Report 2021

YPTECH Co., Ltd.
Shin-Toyo Kikai Kogyo Co., Ltd.

Films

Bioreactors

Main Trading Products▶ Ceramic-related products, boron compounds (3M, Germany)

Main Trading Products

environmentally friendly society. We will focus on materials
and equipment related to bioscience, healthcare, food,cosmetics, hygiene materials, electronic materials, film andcellulose fiber, and develop essential products in nichemarkets.
We will continue to focus on these and other products
related to life science, which can contribute to improving
people’s health and QoL.

Affiliated Companies

Chem-Inter Corporation
Sanyo Life Material Co., Ltd▶ Synthetic genes; bioprocess sensors; bioreactors; handheld

X-ray fluorescent (XRF), laser-induced breakdown spectroscopy(LIBS), atomic emission, near-infrared (NIR) and mid-infrared(MIR) spectroscopy, and handheld Raman spectroscopy
systems; optical interferometry thin-film thickness measurement
systems; cavity ring-down spectroscopy (CRDS) gas analyzers;
sun protection factor (SPF) analyzers; plasma cleaners; particle
size distribution measurement equipment; zeta potential
measurement equipment; surface tension, contact angle andfoam analyzers; dispersion stability analyzers; glossmeters;
accelerated weathering testing equipment; cyclic corrosion
testers; friction and wear testers; tribology equipment; smalland wide-angle X-ray scattering (SAXS/WAXS) analyzers

Sanyo Technos Co., Ltd.
Nihon Rufuto Co., Ltd.

Test Materials Co., Ltd.

SANYO TRADING Corporate Report 2021

13

Foundations of Our Value Creation

Corporate Officers(As of December 22, 2021)

Directors

Masanobu
Shintani

Apr. 1982 Joined the Company
Oct. 2008	Tokyo Rubber Business Unit 3,
General Manager
Oct. 2010	General Manager assistant toOperational Headquarters
Jan. 2012	Sanyo Corporation of America,
President
Oct. 2012	Executive Officer and Sanyo
Corporation of America, President
Dec. 2013	Director & Executive Officer andOperational Headquarters, General
Manager
Oct. 2014	Director & Executive Officer andCorporate Strategy Dept., General
Manager
Dec. 2018 President & CEO (incumbent)

HirotoNakamura

Apr. 1984 Joined the Company
Oct. 2006	Tokyo Rubber Business Unit 1,
General Manager
Oct. 2010	Rubber Business Unit, General
Manager
Oct. 2013	Executive Officer and Rubber
Business Unit, General Manager
Dec. 2017	Director & Executive Officer andRubber Business Unit, General
Manager
Dec. 2018	Director & Executive Officer in chargeof Business Divisions and Rubber
Business Unit, General Manager
Dec. 2019	Director & Executive Officer in chargeof Business Divisions (incumbent)

Hirotaka
Sugihara
Outside Director(Independent Officer)

President & CEO

Director & Executive Officer
in charge of Business Divisions

Number of shares owned

Number of shares owned

0

40,00065,600Attendance at Boardof Directors meetings
14/14 (100%)

Attendance at Boardof Directors meetings
14/14 (100%)

Attendance at Boardof Directors meetings

Number of shares owned

HiroshiShirai

Apr. 1982 Joined the Company
Oct. 2006	Sanyo Corporation of America,
President
Apr. 2009	Tokyo Chemical Business Unit 2,
General Manager
Oct. 2013	Executive Officer and Corporate
Planning Dept., General Manager
Oct. 2014	Executive Officer and General
Affairs Dept., General Manager
Oct. 2015	Executive Officer supervising
Administration Divisions
Dec. 2017	Director & Executive Officer incharge of Administration Divisions(incumbent)

KenichiShindoDirector & Executive Officer
in charge of Administration
Divisions

Director & Executive Officer
in charge of Business Divisions

Number of shares owned

Number of shares owned

13,60027,400Attendance at Boardof Directors meetings
14/14 (100%)

Attendance at Boardof Directors meetings
14/14 (100%)

Toshiaki
Mizusawa

Apr. 1982	Joined Taiyo-Kobe Bank (present
Sumitomo Mitsui Banking
Corporation)
May 2012 Joined the Company
Apr. 2013 Credit Dept., General Manager
Dec 2019	Executive Officer supervising
Administration Divisions and Credit
and Legal Dept., General Manager
Oct. 2020	Executive Officer supervising
Administration Divisions andHuman Resources Dept., General
Manager
Dec. 2020	Director & Executive Officer incharge of Administration Divisionsand Human Resources Dept.,
General Manager (incumbent)

Director & Executive Officer in chargeof Administration Divisions and Human
Resources Dept., General Manager

Attendance at Boardof Directors meetings
10/10 (100%)(Since appointment on December 22, 2020)

14

SANYO TRADING Corporate Report 2021

Apr. 1985 Joined the Company
Oct. 2006	Machinery & Environmental Business
Unit 1, General Manager
Apr. 2009	Industrial Products Business Unit,
General Manager
Oct. 2013	Executive Officer and Industrial Products
Business Unit, General Manager
Dec. 2013	Executive Officer and Sanyo
Corporation of America, President
Oct. 2016	Executive Officer and Chemical
Business Unit, General Manager
Dec. 2017	Executive Officer and Machinery andEnvironmental Business Unit, General
Manager
Dec. 2018	Sanyo Machinery Co., Ltd.,
Representative Director and President
Dec. 2019	Director & Executive Officer in chargeof Business Divisions, and Machineryand Environmental Business Unit,
General Manager
Jun. 2020	Director & Executive Officer in charge ofBusiness Divisions, Machinery andEnvironmental Business Unit, General
Manager and Scientific Instruments
Business Unit, General Manager
Oct. 2021	Director & Executive Officer in chargeof Business Divisions (incumbent)

Directors (Audit and Supervisory Committee Members)
Apr. 1980	Joined The Bank of Tokyo, Ltd.
(present MUFG Bank, Ltd.)
Nov. 2003	The Bank of Tokyo, Ltd., Marunouchi
Branch, Corporate Sales II, General
Manager
Dec. 2004	The Bank of Tokyo, Ltd., Oji Branch,
General Manager
Mar. 2009	Joined the Company; Finance Dept.,
General Manager
Dec. 2019	Sanyo Trading Co., Ltd., Director(Audit and Supervisory Committee
Member) (incumbent)

Yukio
Miyajima
Outside Director(Independent Officer)

Number of shares owned
0
Attendance at Boardof Directors meetings
14/14 (100%)

Apr. 1988 Joined Kanematsu Corporation
Oct. 2000	Joined Asahi Audit Corporation(present KPMG AZSA LLC)
Dec. 2004	Hasegawa CPA Office,Representative (incumbent)
Dec. 2017	Sanyo Trading Co., Ltd., Director(Audit and Supervisory Committee
Member) (incumbent)

Yasuhiko
Nishimura

Asako
Hasegawa

Director (Full-Time Audit andSupervisory Committee Member)

Outside Director (Audit and Supervisory
Committee Member) (Independent Officer)

Number of shares owned
29,200Attendance at Boardof Directors meetings
14/14 (100%)
Attendance at Audit andSupervisory Committee meetings
15/15 (100%)

Number of shares owned
0
Attendance at Boardof Directors meetings
14/14 (100%)
Attendance at Audit andSupervisory Committee meetings
15/15 (100%)

Apr. 1978	Joined Nichimen Co., Ltd.
(present Sojitz Corporation)
Apr. 2004	Sojitz Corporation, Senior Managing
Executive Officer
Apr. 2005	Sojitz Insurance Agency Corporation,
Representative Director and President
Dec. 2017	Sanyo Trading Co., Ltd., Director(incumbent)
Jun. 2019	Zensho Holdings Co., Ltd., Outside
Director (Audit and Supervisory
Committee Member) (incumbent)

Number of shares owned
4,900—(Newly appointed on December 22, 2021)

Apr. 1981 Joined ITOCHU Corporation
May 1994	ITOCHU Corporation, Assistant to CEO for
Asian Bloc (residing in Hong Kong)
Apr. 2004	ITOCHU Corporation, Financial Business
Development Dept., General Manager
Apr. 2005	Seconded to Orient Corporation(Executive Officer)
Jul. 2007	ITOCHU Corporation, Financial Business
Dept., Acting General Manager and
Financial Retail Promotion Dept., General
Manager
Apr. 2008	ITOCHU Corporation, Finance, Real Estate,
Insurance & Logistics Management Planning
Dept., General Manager
Apr. 2010	ITOCHU Corporation, Financial & Insurance
Business Dept., Acting Manager
May 2010	POCKETCARD CO., LTD., Director (part-time)
Apr. 2012	ITOCHU Corporation, Chief Corporate
Planning Officer for ASEAN & South West
Asia Bloc (residing in Singapore)May 2014	POCKETCARD CO., LTD., Director, Vice
President supervising Sales Group
Mar. 2018	POCKETCARD CO., LTD., Vice President,
Executive Officer, Planning Headquarters,
General Manager
Dec. 2021	Sanyo Trading Co., Ltd., Director (incumbent)

Apr. 2000 Joined YUASA and HARA
Sep. 2013	Joined Yamada, Goya & Suzuki(incumbent)
Jun. 2014	Outside Director (Audit andSupervisory Committee Member)of Kanematsu Sustech Corporation(incumbent)
Dec. 2021	Sanyo Trading Co., Ltd., Director(Audit and Supervisory Committee
Member) (incumbent)

Kuniaki
Kobayashi
Outside Director (Audit and Supervisory
Committee Member) (Independent Officer)
Number of shares owned
0
Attendance at Boardof Directors meetings—
Attendance at Audit andSupervisory Committee meetings—

Executive Officers
Masanobu Shintani*

Mitsuyasu Hirasawa

President & CEO

Senior Executive Officer, Industrial
Products No.1 & No.2 Business Unit,
Senior Director and Business
Development Office, Manager

Hiroto Nakamura*
Executive Officer in charge ofBusiness Divisions

Hiroshi Shirai*
Executive Officer in charge of
Administration Divisions

Kenichi Shindo*
Executive Officer in charge ofBusiness Divisions

Yasushi Komiya
Executive Officer and Rubber Business
Unit, General Manager

Ryuichi Otani
Executive Officer and Corporate
Strategy Dept., General Manager

Toshiaki Mizusawa*
Executive Officer in charge of
Administration Divisions and Human
Resources Dept., General Manager(Note) Executive Officers marked with an asterisk (*) also serve as Directors.

(Newly appointed on December 22, 2021)

SANYO TRADING Corporate Report 2021

15

Foundations of Our Value Creation

Corporate Governance
Basic Approach to Corporate GovernanceSanyo Trading has defined its Management Mission as “Withan unwavering and enterprising spirit, and a free and open
corporate culture, we will supply the best solutions in a flexible
and timely fashion, working to realize a process of ‘co-creation’by which we contribute both to the sustainable developmentof the international community and the happiness of ouremployees.” We believe that fulfilling this Management Mission
will meet the expectations of all our stakeholders.

To that end, our Credo states: “We comply with laws andregulations, and act with integrity,” “We make decisions andact on them quickly and accurately,” and “We understand thetrends of the times and anticipate change.” By following these
aspects of this Credo, we aim to reinforce our corporate
governance system.

Corporate Governance Structure

General Meeting of Shareholders

Nomination andCompensation
Committee

Deliberation,offering
opinion

ReportingAppointment,
dismissal

Reporting

Auditing,supervision

Board of Directors
Consultation

Audit and Supervisory
Committee
Auditing

ReportingAppointment,
dismissal

Cooperation

Accounting Auditor
Cooperation

Compliance Committee

Selection,
dismissal,
supervision

President & CEO

Risk Management
Committee

In May 2020, the Nomination and Compensation Committee
was voluntarily established as an advisory body to the Boardof Directors for the purposes of enhancing the independence,
objectivity, and accountability of the functions of the Board of
Directors concerning the appointment and dismissal of the
President & CEO and Directors with special titles, the nominationof Director candidates, and the remuneration of Directors(excluding Audit and Supervisory Committee Members), etc.,
and further enhancing corporate governance.
The committee, which comprises at least three Directors
appointed by the Board of Directors (a majority of whom must
be Outside Directors), deliberates on matters concerning thenomination and remuneration of Directors and reports its
conclusions to the Board of Directors.

Committee of Executive Officers
The Company introduced an executive officer system in 2003.
The Committee of Executive Officers currently comprises eight
members (five of whom are Directors). It meets monthly toshare information and strives to improve day-to-day operations
in respective areas of responsibility.

Auditing

Accounting
audit

Name

Board of Directors

Audit and Supervisory Committee

The Board of Directors comprises seven Directors who are
not Audit and Supervisory Committee Members, two of whom
are Outside Directors; and three Directors who are also Audit
and Supervisory Committee Members, two of whom are
Outside Directors. The Board of Directors makes decisions onimportant matters relating to Group management. It also
audits and supervises business execution. The Board of
Directors holds a regular monthly meeting, as well as
extraordinary meetings for any urgent matters. The term ofoffice of Directors who are not Audit and Supervisory
Committee Members is one year. The term of office of
Directors who are also Audit and Supervisory Committee
Members is two years.

The Company established the Audit and Supervisory Committee
to strengthen auditing and supervision of the Board of Directors’
execution of duties, and to increase agility and speed in decisionmaking by separating auditing and supervision from businessexecution. The committee comprises three Directors (onefull-time member and two Outside Directors). These Directors
audit and supervise the legal compliance and adequacy ofthe execution of duties of Directors who are not Audit andSupervisory Committee Members. The Audit and Supervisory
Committee holds a regular monthly meeting, as well as
extraordinary meetings for any urgent matters. Each Audit andSupervisory Committee Member follows the policies set by thecommittee, and requests Directors who are not Audit andGenderCorporate
ESG/
International
management Sustainability experience

Masanobu Shintani

Male

●

●

●

Hiroto Nakamura

Male

●

●

●

Hiroshi Shirai

Male

●

Kenichi Shindo

Male

●

Toshiaki Mizusawa

Male

OutsideYukio Miyajima

Male

●

●

OutsideHirotaka Sugihara

Male

●

●

Business Divisions andAdministration Divisions

Major Governance Bodies

SANYO TRADING Corporate Report 2021

When appointing an executive officer or a Director, thePresident & CEO creates an appointment plan that takes
into consideration the composition (in terms of diversity, etc.)of the Board of Directors, qualities required of executive
officers and Directors (e.g., management ability, experienceand expert knowledge) and other factors. The plan isdeliberated on by the Nomination and Compensation
Committee, the majority of whom are independent Outside
Directors. Following the committee’s deliberations, theBoard of Directors makes a decision on the proposed
appointment of an executive officer or Director in accordancewith the appointment plan.
In the event that an executive officer or a Director has
committed a potentially dishonest or improper act, or isdeemed not to able to perform the responsibilities of hisor her role, an investigation is conducted as necessary.
Following deliberation by the Nomination and Compensation
Committee, the majority of whom are independent Outside
Directors, the Board of Directors makes a decision on thedismissal of the executive officer or Director, or other response.
For remuneration of Directors who are not Audit andSupervisory Committee Members and Directors who
are Audit and Supervisory Committee Members, pleaserefer to Corporate Officer Remuneration, Etc. on thefollowing page.

Nomination and Compensation Committee

Skill Matrix
Cooperation

Executive Officers

16

Appointment and Remuneration, Etc. of
Corporate Officers

Internal Audit Section

Appointment,
dismissal,
supervision

Supervision

Appointment,
dismissal

Supervisory Committee Members and other personnel toprovide reports and conduct investigations as needed. The
committee audits and supervises management in cooperation
with the Internal Audit Section and the accounting auditor.

Yasuhiko Nishimura

Audit andSupervisory
Committee Member

Male

OutsideAsako Hasegawa

Audit andSupervisory
Committee Member

FemaleOutsideKuniaki Kobayashi

Audit andSupervisory
Committee Member

Male

OutsideKiitsu Sugita

Substitute Audit
and Supervisory
Committee Member

Male

Legal affairs/
Finance/
Risk
Accounting
management

●
●

●

●
●

●

●

●

●
●

●

●

Kiitsu Sugita●

SANYO TRADING Corporate Report 2021

17

ComplianceCorporate Officer Remuneration, Etc.

Compliance(1) Policy for determining corporate officer remunerationand calculation method
1) Basic policy
With regard to remuneration for Directors (excluding Audit and Supervisory
Committee Members), the Company has formulated a remuneration systemthat closely aligns with the interests of shareholders and effectively incentivizes
Directors to continuously improve corporate value. The basic policy when
determining remuneration for each Director is to set remuneration at a level thatreflects the responsibilities of the position.
Remuneration for Directors (excluding Audit and Supervisory Committee
Members) consists of fixed remuneration (monetary remuneration) as basic
remuneration, performance-linked remuneration, and share-based remuneration
as non-monetary remuneration. Remuneration for Outside Directors responsible
for supervisory functions consists of only fixed remuneration (monetary
remuneration) in consideration of the responsibilities of the position. To enhance
objectivity and transparency when determining remuneration for Directors, theNomination and Compensation Committee, the majority of whom are Outside
Directors, discusses approaches and the policy for determining remuneration of
corporate officers, as well as remuneration levels, after which the Board of
Directors determines remuneration based on the advice and suggestions of thecommittee. Remuneration, etc. for corporate officers in the fiscal year ended
September 2021 was determined at the Board of Directors meeting held on
November 5, 2021.
2) Policy for determining remuneration, etc. for each Director(excluding Audit and Supervisory Committee Members)
The policy for determining remuneration, etc. for each Director (excluding
Audit and Supervisory Committee Members) is decided on at the Board of
Directors meeting.
A) Fixed remuneration (monetary remuneration)
Basic remuneration for Directors (excluding Audit and Supervisory Committee
Members) consists of monthly fixed remuneration, which is the total of thesalary as a company representative, supervisor and/or executive officer. The
same amount is paid for each equivalent position. Basic remuneration isdetermined taking into account remuneration levels at other companies andemployee salary levels, among other factors, while also comprehensively
considering changes in the economic and social environment, etc.
B) Performance-linked remuneration
Performance-linked remuneration consists of monetary remuneration thatreflects the business performance of the Company, in order to incentivize
Directors to improve business performance each fiscal year. Consolidated
ordinary profit is used as the index of business performance, because it isused as a performance target when deciding internal budgets, and is also
considered to be the easiest index for understanding the management statusof the Group. Performance-linked remuneration is paid as a bonus at the endof each fiscal year and is calculated based on the consolidated ordinary profit
that fiscal year. Performance-linked remuneration is calculated by multiplying
the base amount of the bonus defined for a given position by the performancelinked coefficient, which is calculated from the achievement rate of thebusiness target (consolidated ordinary profit) for the fiscal year. The upper limitof the performance-linked coefficient is 150%. If consolidated ordinary profit isbelow a certain threshold, the performance-linked coefficient shall be 0%. The
following methodology is used to reflect business performance in theperformance-linked remuneration amount: for the President, 100% of thisremuneration reflects the business performance of the Company; for other
Directors, 80% reflects the business performance of the Company and 20%
reflects the qualitative evaluation of the individual Director, which is determinedby the President.

C) Non-monetary remuneration
Non-monetary remuneration consists of a stock compensation-type
stock option, which is issued to registered Directors (excluding Outside
Directors and Audit and Supervisory Committee Members) every
February with comprehensive consideration of the position, degree ofcontribution and business performance (consolidated ordinary profit) that
fiscal year. The details are as follows: stock acquisition rights the exerciseof which entails the issue of common shares at the exercise price pershare of 1 yen on the condition that Directors can only exercise theserights after retiring from their position.
D) Guideline for ratio of fixed remuneration, performance-linked remunerationand non-monetary remuneration within the total remuneration amount for
Directors (excluding Audit and Supervisory Committee Members) (whenperformance-linked remuneration is at its base amount)
Fixed remuneration

Performance-linked
remuneration

Non-monetary
remuneration

President

55%

35%

10%

Other Directors

65%

25%

10%

E) Items concerning resolutions of the General Meeting of Shareholders related
to remuneration, etc., of Directors (excluding Audit and Supervisory
Committee Members)
At the 73rd General Meeting of Shareholders held on December 19, 2019, a
resolution was passed to limit the total amount of monetary remuneration(fixed remuneration and performance-linked remuneration) for all Directors(excluding Audit and Supervisory Committee Members) to a total of no morethan 250 million yen per year (of which, for Outside Directors, a total of no
more than 20 million yen per year), and at the 69th General Meeting of
Shareholders held on December 17, 2015, a resolution was passed to limit
the amount of stock compensation-type stock option to a total of no morethan 20 million yen per year. The number of Directors (excluding Audit andSupervisory Committee Members) subject to these resolutions of the 73rd
and 69th General Meetings of Shareholders at the time of their adoption was
six (including one Outside Director) and four, respectively.
3) R easoning why the Board of Directors deems the content of remuneration, etc.
for each individual to be in line with the policyGiven that the Nomination and Compensation Committee reports its
conclusions after checking consistency, etc., between the content of
remuneration, etc., for each Director and the policy for determining
remuneration, and that the Board of Directors basically respects thecommittee’s report, the Board of Directors deems the content of
remuneration, etc., for individual Directors to be in line with the policy.

The Company has formulated the Sanyo Trading Group Code of
Conduct Manual, which specifies how officers and employees of
the Company and its subsidiaries should act to ensure theiractions are in accordance with the Management Mission, and incompliance with laws and regulations as well as the Articles ofIncorporation. To ensure the effectiveness of the manual, thePresident appoints a Director in charge of Compliance. In
addition, in accordance with the Compliance Regulations, theCompany has established the Compliance Committee, which is
responsible for supervising Group-wide compliance. As such, theCompany has established an effective compliance system. The
committee periodically reports the status of compliance to theBoard of Directors.
Subsidiaries make periodic reports to the Board of Directors
and the relevant supervising division, and a system is in place bywhich they are able to report their status regularly throughparticipation in meetings of the Committee of Executive Officers

or other means under the Subsidiary Management Regulations
and the Standards for Decision-Making Authority. Depending on
the matters stipulated by the relevant regulations, legal andregulatory compliance is ensured by the final decision of theBoard of Directors.
The Internal Audit Section audits the business activities of theCompany and its subsidiaries to ensure effective management
and compliance with laws and regulations, internal regulations
and trade practices, etc., and reports audit results to the Boardof Directors.
The Company has established and continues to operate
whistleblower hotlines, whereby acts that violate or risk violatinglaws and regulations or social norms can be reported internally to
the Compliance Committee and externally to a third party(attorney). Internal regulations have been established to protect
reporters from receiving unfair treatment.

Risk Management
The Company takes all reasonable steps to identify a variety ofrisks that arise in business execution by applying consistent
standards, and implements comprehensive risk management
in order to ensure sound management and maximize
shareholder value.
Specifically, under the Risk Management Regulations, theCompany ensures the clarity of its risk management system byspecifying the divisions responsible for different types of risks
and managing risks exhaustively and comprehensively. A
Director in charge of Risk Management is appointed by the
President and the Risk Management Committee has been

established so as to monitor various risks intrinsic to theCompany’s operations as well as risks that the Company
should prevent from manifesting to ensure business continuity,and promptly respond to changes in the risk landscape. The
committee regularly reports to the Board of Directors with risk
management overviews, including countermeasures for whena risk that should be avoided manifests. For subsidiaries, asystem has been established under the Risk Management
Regulations for preempting losses. It involves holding
interviews with representative directors and other relevant
parties as needed.

4) Remuneration for Directors who are also Audit and Supervisory
Committee Members
At the 69th General Meeting of Shareholders held on December 17, 2015, a
resolution was passed to limit remuneration for Directors who are also Audit andSupervisory Committee Members to a total of no more than 40 million yen per
year. Remuneration is determined within that range through discussions among
the Directors who are also Audit and Supervisory Committee Members. The
number of Directors who are also Audit and Supervisory Committee Members
subject to the resolution of the General Meeting of Shareholders at the time ofits passing was three.

Total Remuneration, Etc.
Position18

Total remuneration, etc.
(Thousands of yen)

Total of each type of remuneration, etc. (Thousands of yen)Fixed remuneration

Performance-linked
remuneration, etc.

Non-monetary remuneration,
etc.

Eligible corporate officers

Directors (excluding Audit andSupervisory Committee Members)(excluding Outside Directors)

168,956

104,064

47,00017,892

6

Directors (Audit and Supervisory
Committee Members)(excluding Outside Directors)

14,40014,400――1

Outside Corporate Officers

19,80019,800――3

SANYO TRADING Corporate Report 2021

For details of business and other risks, please see our Securities Report.
(Available only in Japanese.)https://www.sanyo-trading.co.jp/ir/library/securities/

SANYO TRADING Corporate Report 2021

19

Foundations of Our Value Creation

SocialWorking Conditions at Sanyo Trading in Numbers

Diversity & Inclusion

Employees(consolidated)

Monthly average
overtime

Retention rate of new
graduate employees1

442

12.7 hours

100 %Rate of return to work
after maternity leave2

Average annual paid
leave used

Employees assigned
overseas

93 %12.3 days

29(As of September 30, 2021)(FYE 9/2020)

Sanyo Trading aims to maintain an environment where each
employee can work comfortably. Employees can takechildcare leave for up to two years and on return they canchoose their working style flexibly, such as opting for
reduced hours per day.
It is standard at many companies to give only 10 days ofannual paid leave to first-year employees. However, at
Sanyo Trading, we give employees 20 days of paid leavefrom their first year.

Initiatives for Society
In February 2021, the Company held the Universal Manners Test for the second time. More than half of ouremployees have taken the test and acquired Grade 3 certification. As another initiative, we provide support forchildren living in foster care facilities as they seek to become independent adult members of society. We willcontinue engaging in these and other such social contribution activities.

1. Ratio of employees still employed by the Company as of reference date (September 30, 2021) among new graduate employees who joined the Company during the preceding
three-year period
2. Ratio of employees returning to work among all employees taking maternity leave during the preceding five-year period

Universal Manners Test

Working Conditions at Sanyo Trading (Training System)
Sanyo Trading has set “investing in human resources” as one of the basic strategies of its long-term management
plan and aims to nurture globally successful professionals. We strengthened investment in human resources by
establishing a dedicated Human Resources Department in October 2020 and greatly expanding our training system.
We are also focusing on creating an environment that enables various working styles, such as by revising our
personnel system, and promoting telework and staggered working hours.

Overseas Training System
Young managerial track employees areable to apply via an in-house recruitment
system for year-long training programs
at our offices in China, Thailand, Vietnam
and other countries. In 2021, one person
was posted to Shanghai, China and one
to Ho Chi Minh City, Vietnam. While
working at the local office, employees
are provided with strong support fromthe Company so that they can get themost from this one-year experience,such as through enrollment at a
language school.

Short-Term Training in New York
Young managerial track employees are
eligible to apply for a three-monthtraining program in New York. Those
selected are given on-location language
training, thereby helping them to acquire
the skills for global success.

External Training and E-Learning
We take part in a variety of external
training programs for developing
employees and improving their businessskills. Furthermore, we offer more than
100 e-learning programs that enable
employees to learn the skills that theywant. We also have an incentive system
for rewarding employees who acquire
certain certifications.

Level-Based Training
Our support for the ongoingdevelopment of new employees

20

SANYO TRADING Corporate Report 2021

continues in their second year andbeyond. Our level-based training enables
them to learn the skills and mindset
required relative to their respective
length of service and role, including
leadership and management skills.

New Employee Training
Internal training for new employees includes
an overview of the business dealings ofeach business unit and training workshops
on basic knowledge conducted by theadministration divisions. New employees
receive external training as well. They also
have opportunities to deepen theirunderstanding of import and export
through training at facilities involved ininternational trade, such as customs andwarehouse facilities. Prior to theirassignment to a specific department,
managerial track employees undergo about
two months of training to learn businessbasics at our administration divisions.

The Universal Manners Test is administered by the Japan Universal Manners
Association. The goal of this certification is to cultivate “universal manners,”
i.e., the ability to act responsibly, mindful of people’s differences, for example
when interacting with seniors, people with disabilities, baby-stroller users or
people of a different nationality. The Japan Universal Manners Association
oversees curriculum development so as to provide better understanding of
the viewpoints and ideas of the beneficiaries of such manners.
Employees of the Sanyo Trading Group vary in gender, nationality, age andother characteristics, as well as in background and values. As thediversification and globalization of our businesses rapidly progresses,
achieving the Management Mission of the Sanyo Trading Group—“With anunwavering and enterprising spirit and a free and open corporate culture, wewill supply the best solutions in a flexible and timely fashion, working to realizea process of “co-creation” by which we contribute both to the sustainable
development of the international community and the happiness of ouremployees”—requires that diverse employees respect each other's values,
and perform at their full potential.
As a trading company, we value every one of our employees to the highest
degree and consider embracing diversity to be a vital corporate strategy. The
Sanyo Trading Group will continue to emphasize the establishment of various
training programs and improvement of the working environment, with the aimof ensuring that all employees can continue to advance their careers while
enjoying long-term fulfillment and peace of mind.

Bridge for Smile
Our company donates to Bridge for Smile, a specified nonprofit corporationthat supports children living in foster care facilities in achieving independence.
Our donation in the fiscal year ended September 2021 was used to support a
volunteer mentorship program that aims to prevent children from becomingsocially isolated after leaving foster care.
We support children as a precious part of our society, sharing in Bridge for
Smile’s belief that all of society carries the responsibility of creating anenvironment where children can safely find their own place in society, and livewith dreams, hopes and smiles.

SANYO TRADING Corporate Report 2021

21

Foundations of Our Value Creation

Environment
Basic Environmental Approach

Contributing to a Circular Society

In recent years, global environmental issues have become a serious social problem and it is increasingly
important that corporations engage with these issues. Sanyo Trading actively works to preserve theglobal environment and makes the utmost effort to ensure the sustainable development of society
through sound business activities.

Transition to Environmentally Friendly Materials
Environmental Load Reduction
through ENR Derived from Plants
We trade in epoxidized natural rubber (ENR) derived
from plants. This material is characterized by highperformance—it adds functions such as heat resistance,
abrasion resistance and adhesiveness to conventional
natural rubber. It is used for rubber products and as analternative material to leather (i.e., vegan leather).
Furthermore, we expect the commercialization of
epoxidized natural rubber latex (ENRL) to find a variety
of product applications in the future.
Sanyo Trading will contribute to environmental load
reduction by actively selling such plant-derived materials.

New PTFE Wax Contributes
to Reducing PFOA Use
Perfluorooctanoic acid (PFOA) is used as a surfactant
for various products. However, there are concerns
about its persistence in the environment and potential
for bio-accumulation, and given the global trend toward
stricter regulation, we expect the import, production
and use of PFOA to become increasingly restricted. The
polytetrafluoroethylene (PTFE) we previously handledcontained PFOA as an impurity. However, we now trade
in a newly developed, fine powder PTFE wax that
contains considerably less PFOA, thereby contributing
to the preservation of ecosystems.

Initiatives to Address Climate Change
Supplying Greenhouse Gas Analyzers
The Scientific Instruments Department of the Life Science Business Unit
handles a greenhouse gas analyzer that measures greenhouse gases
such as CO2 and methane—these gases may have been emitted directly
into the atmosphere or have been emitted from the soil to the atmosphere.
The analyzer can stably obtain data in harsh hydrothermal environments
such as in polar regions, deserts, paddy fields or subtropical regions.
This product is mainly provided to the Japan Meteorological Agency, theMinistry of the Environment and the National Institute for Environmental
Studies, and is also installed on the Tokyo Skytree. We will continue
contributing to the resolution of issues related to climate change andrealizing a decarbonized society.

Circular
Systems in the Livestock Industry(Production of Organic Fertilizer by Pelletizing Livestock Manure)

Raising livestock for meat, egg and milk consumption
naturally involves feeding animals and disposing of theirmanure. If manure piles up in the open, it can be
washed away by rain and pollute rivers and other water
bodies, so in order to help prevent that, the Japan
government introduced the Act on the Appropriate
Treatment and Promotion of Utilization of Livestock
Manure in 1999. The act mandates the appropriate
processing of livestock manure. As a result, the livestockindustry has increasingly adopted measures that makeeffective use of manure as fertilizer.
Sanyo Trading had been selling a pellet mill for livestock
manure as a single piece of equipment, but in 2005 webegan supplying an entire production system for livestock
manure pellets. To date, we have supplied 11 plants. We
will continue supplying circular systems that enable theeffective use of manure in the livestock industry.

S econd Project for Establishing Wood Pellet
Gasifiers with Combined Heat and Power(CHP) Plant Systems in Hokkaido
In May 2019, the Shimokawa Forest Biomass Cogeneration
Facility started operation in Shimokawa-cho, Kamikawagun, Hokkaido. Owned by Hokkaido Biomass Energy Co.,
Ltd., a company jointly established by Mitsui & Co., Ltd.
and Hokkaido Electric Power Co., Inc., the facility is a CHP
power plant (2-MW class manufactured by BurkhardtGmbH of Germany), equipped with 11 wood pellet
gasifiers. The facility neighbors a pelletizing factory. In May
2021, as the second such project, the Tobetsu Forest
Biomass Cogeneration Facility, a CHP power plant (1-MWclass) with six such gasifiers, started operation in Tobetsucho, Ishikari-gun, Hokkaido. This facility is expected tosupply power equivalent to the annual demand of morethan 2,000 households. During test operation of the facility,
supervisors from Burkhardt were unable to enter Japan due
to the COVID-19 pandemic. However, our skilled engineers
were able to cooperate with them remotely and complete
testing without issue and within the scheduled time.

Focusing on the Importance of Biodiversity andPromoting Social Contribution through Our Businesses
In June 2020, we announced ourendorsement of the Initiative based on the
Declaration of Biodiversity by Keidanren(published by Keidanren, the Japan
Business Federation). We will utilize marine
equipment (underwater drones) handled bysubsidiary Cosmos Shoji Co., Ltd. formonitoring coral ecosystems and theenvironment, including surveys of marine
refuse, thereby contributing to the preservationof the environment and biodiversity.

（UNDB-J）

経団連生物多様性宣言
イニシアチブBoxfish ROV (underwater drone)

Initiative based on the Declaration of
Biodiversity by Keidanren

22

SANYO TRADING Corporate Report 2021

SANYO TRADING Corporate Report 2021

23

Company Information

Financial Highlights

Corporate Data / Stock Information

Consolidated Management Indicators

Corporate Overview

Fiscal year ended
September 2017

Fiscal year ended
September 2018

Fiscal year ended
September 2019

Fiscal year ended
September 2020

Fiscal year ended
September 2021

Operating results (Millions of yen)

(As of September 30, 2021)

Breakdown of Stocks by Stockholder

		Company
Name

Sanyo Trading Co., Ltd.

		
Establishment

May 28, 1947

		
Head
Office2-11, Kanda Nishiki-cho, Chiyoda-ku
Tokyo, 101-0054 JapanNet sales

67,73878,45083,23076,08789,788		Tel: +81-3-3518-1111

Gross income

12,264

13,41014,883

14,206

15,510		
Capital¥1,006,587,450

Operating income

4,938

5,263

5,871

4,791

5,506

		
Employees

442 (Consolidated)

Ordinary income

5,270

5,575

6,075

5,271

6,190

Earnings attributable to owners of
the parent

3,351

3,635

4,018

3,013

4,256

Total number ofoutstanding shares

29,007,708

Stock Status
		 Listing
StockFirst Section of the Tokyo Stock Exchange

Financial indicators (%)

		 CodeSecurities

3176

Ordinary income to net sales ratio

7.8

7.1

7.3

6.9

6.9

		
Tokyo Securities Transfer Agent Co., Ltd.
Shareholder
Registry
Administrator

Financial institutions

38.4%

Individuals, etc.

36.0%

ROE

15.2

14.5

14.5

10.1

13.1

40,000,000

Other corporations

15.5%

ROA

14.8

13.8

14.2

11.6

12.6

Total
Number of		
Authorized Shares

29,007,708

Foreign corporations, etc.

7.9%

Equity ratio

61.1

63.5

66.2

64.9

67.5

Total
Number of		
Outstanding Shares

4,882

Financial instruments
business operators

1.1%

Total
Number of		
Stockholders

Treasury shares

1.1%

Per share (Yen)
Earnings per share

117.10126.99140.36105.22148.52

Net assets per share

831.88922.67

1,011.31

1,069.41

1,195.18

29.5

32.0

37.0

37.5

39.0

Total assets

38,98741,60643,731

47,23050,834Non-current assets

7,586

7,694

7,355

7,738

8,300

Annual dividends per share

Fiscal year-end (Millions of yen)

Major Stockholders
Number of shares held(Thousand shares)

Shareholding ratio (%)

Custody Bank of Japan, Ltd. (Trust Account)

2,839

9.90

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

2,572

8.97

Toagosei Co., Ltd.

1,497

5.22

1,137

3.96

Name

Interest-bearing debt

1,666

1,929

1,325

4,543

2,443

MUFG Bank, Ltd.

Net assets

24,60026,75629,34331,03834,725

Sumitomo Mitsui Banking Corporation

1,137

3.96

Sumitomo Mitsui Trust Bank, Limited

1,136

3.96

Cash flows (Millions of yen)
Cash flows from operating activities

178

1,583

5,088

6,186

2,253

Cash flows from investing activities(1,359)(408)(1,057)(2,189)(1,009)Cash flows from financing activities(15)(1,297)(1,957)

1,834(3,301)

Cash and cash equivalents, end of year

2,601

2,468

4,548

10,4188,663

BOT Lease Co., Ltd.

1,128

3.93

Susumu Tamaki

1,095

3.82

Meiji Yasuda Life Insurance Company

675

2.35

Mitsui Sumitomo Insurance Co., Ltd.

637

2.22

Note: Shareholding ratio is calculated excluding treasury shares (315,120).

Note: Per share indicators are calculated taking into consideration the effect of the 2-for-1 stock split conducted on February 1, 2020.

Stock Price
Trading volume (Shares)

Stock price (Yen)Net Sales

Ordinary Income

Earnings Attributable to Owners of
the Parent(Millions of yen)

(Millions of yen)

(Millions of yen)

100,000

7,000

5,000

50,000

3,500

2,500

2,000

4,000,000

1,000

2,000,000

0

0
8 9
2018

10 11 12Stock price

0

0

9/17

24

9/18

9/19

9/20

9/21 （FYE）

SANYO TRADING Corporate Report 2021

0

9/17

9/18

9/19

9/20

9/21 （FYE）

9/17

9/18

9/19

9/20

9/21 （FYE）

1 2
2019

3

4

5

6

7

8

9

10 11 12

1 2
2020

3

4

5

6

7

8

9

10 11 12

1 2
2021

3

4

5

6

7

8

9

(Month)Trading volume

Note: The Company conducted a 2-for-1 stock split of common shares on February 1, 2020. Historical stock prices and trading volumes have been retrospectively recalculated
to take into consideration the effect of the stock split.

SANYO TRADING Corporate Report 2021

25