Annual Report 2015

Creating Value,
The AMITA Way
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AMITA HOLDINGS Co., Ltd.

The morality that pollution is crimiral only after legal conviction is
the mordity that causes pollution.
Eugene Smith*Quoted with permission from Smith’s wife Aileen M. Smith.
Contents
01 Message from the CEO

08 Bussines Domains of the AMITA Group

34 Risk Management

04 Interview: Bringing about the business recovery in 2016.

24 Regional Systems Design Business

38 Stakeholder Communication

02 Creating Value, the AMITA Way (Input-Output)

Specific measures to overcome problems and achieve sustained growth

10 Environmental Strategy Design Business
30 Financial Report for FY 2015

Eisuke Kumano,Founder and CEO / Taro Shimizu, CFO / Emile H. Ishida, Non-exective Director 32

Future Plans

37 Realizing a Sustainable Society
41 Stakeholder Survey

44 Restructuring Aimed at Value Creation & Earnings ReboundMessage from the CEO

Moving forward
From budding to growth and harvesting.
The AMITA Group aims to realize a sustainable society in which nature becomes more abundant the moresociety develops, and the more bonds and trust between people grow.
In 2006, AMITA became Japan’s first specialty environmental sector company to be listed. The company
moved its headquarters to Kyoto in 2012, after theGreat East Japan Earthquake. It has since engaged
wholeheartedly in business aimed at boosting corporate and regional sustainability. However, in August
last year, due mainly to delays in starting up operations at the company’s plant in Taiwan, the company
announced a substantial downward revision to guidance. It raised guidance in February 2016, but revised
its three-year plan. It has to be said that the company’s
forecasts were optimistic and that it was slow to deal
with risk. Management accepts full responsibility andapologizes sincerely to all concerned, including ourshareholders and trading partners.
We launched the radical group business restructuring
in FY 2014 and took off in earnest in FY 2015 has
had a clear impact since the second half of lastyear.
In January 2015, we revised our business domain structure and merged subsidiaries. As aresult, in the Environmental Strategy Design
Business, which supports companies’ environmental strategies, our waste management outsourcing business (BestWay to Manage Waste), which is a

new business, and sales, including orders for related
services, far surpassed initial targets. With our enviURQPHQWDOFHUWLoFDWLRQDVVHVVPHQWVHUYLFHVE\PHUJ
ing a specialty subsidiary with AMITA we achieved
DGPLQLVWUDWLYHHIoFLHQF\JDLQVDQGERRVWHGRXUPDU
keting capabilities, and won twice as many new orders as in 2014. At the Regional Systems Design Business, which supports regional recycling, we started
operating biogas facility, Minamisanriku BIO, AMITA’s sixth plant in Japan, in Minamisanriku in Miyagi
Prefecture.
In January 2016, we changed CEO at two subsidiaries, while at AMITA HOLDINGS, an additional director was appointed at a general meeting of shareholders in March.
The main aims were: (1) to bring about a change instyle at existing operations and strengthen development of innovative new business, and (2) to nurturenext-generation and younger managers.
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move ahead with further restructuring, boost enterprise value and promote solutions to social issues,
and achieve steady improvement in earnings in linewith a new three-year plan.

Environmental strategy
support seminars hosted

Preliminary survey for ASC$TXDFXOWXUH&HUWLoFDWLRQAMITA HOLDINGS Co., Ltd.
Founder and CEO
Eisuke Kumano

Minamisanriku BIO opens

01

INPUTOUR ORGANIZATION

Amount of energy used

Electricity

1.95mn kWh

Cr e a ti n g Va l u e ,Th e A M I TA Way(300,000kWh from renewable energy)

Since the company’s founding in 1977, the AMITAGroup has been engaged in business that creates newvalue by harnessing neglected social resources, basedon the principle of "nothing wasted."
In the following, we outline the kind of value we created from the resources and raw materials the AMITAGroup used in 2015.

Volume of water used

145kl
Kerosene 59kl
Gasoline 7kl
Diesel oil

Mains water

6,044㎥

Raw materials

Industrial waste (raw materials for recycling)

963business premises
2,238 types
136,000t received
12,000t
From

Own plants

6plants

Minamisanriku BIO,
a new biogas facility,
opened in October 2015.

Number of employees

AroundRecycling network
companies

150 Around 300*Based on actual business overthe past five years

CO2 emissions due to manufacturing940t-CO2

Relationship with staff

61%

80%

Proportion who think workat AMITA is worth devoting
their lives to

Propor tion who areproud to work at AMITAOther raw materials*Figures above are actual figures for six AMITA plants.
Does not include headquarters or other offices.

Promoting the harnessing of renewable energy
Kyotango Plant and Minamisanriku BIO use electricity
generated by internal biogas facilities.Kitakyushu Plant
uses solar panels mounted on the plant roof. Ibaraki Plant
purchases renewable energy. The whole company is committed to using green energy.

02

Waste products value analytics database

Around14,500 entries*In this report, “Resource Recycling Plant” is abbreviated to “Plant” as required.

OUTPUT

Manufacturing capital
We manufacture terrestrial resources (natural resource
alternatives) at our six domestic plants (recycling plants).
In 2015, one more company joined AMITA Terrestrial Resources Development Partners (a network of companies
that use AMITA recycling technology).
▶ See p.10 for details about AMITA Terrestrial Resources Development Partners, pp.14-15 for details about Taiwan business.

Financial capital

Net sales¥4,557mn

Due mainly to delays in the start of operation of AMITA’s
plant in Taiwan, net sales missed initial guidance by around¥200mn, coming in at ¥4,557mn, while ordinary income
missed guidance by roughly ¥90mn, giving losses of ¥10mn.
In FY 2016, AMITA will strive for an earnings rebound via
actions such as stable operation of its plant in Taiwan andthe marketing of new Environmental Strategy Support Services.

Operating income¥8mn

Ordinary income

1,154¥-10mn

We want our staff to feel motivated, and to feel a sense ofachievement they cannot attain alone, by working together
with colleagues who share the same vision. We strive invarious ways to develop employees into “human resources
who can create value” based on the idea that “people arean asset, not a cost”.
▶ See p.40 for details about AMITA’s structure, p.43 for details
about survey results.

Intellectual capital
Manufactures terrestrial resources (natural resource alternatives) from over 2,000 types of waste per year leveraging
AMITA’s unique “blending”* process. AMITA has around
14,500 entries in terms of waste analytics, which it uses todevelop new terrestrial resources and boost the quality ofrecycled products, among other things.
▶ See p.13 for details about AMITA’s recycling track record.
*Blending is AMITA’s unique recycling process in which waste is analysedat the chemical element level and adjusted and combined according to theclient’s product specifications.

80

AMITA Group environmental education support(number of seminar participants)

Net income

Human capital

Number of companies that use
multiple services

Number of clients¥-99mnaround5,000*Production
volume of nickel
substituteProduction volume of copper
substitute102,970 t ▶
2,071 t ▶
717 t ▶

Savings in coalmine
production volume
Savings in nickel
mine production
volumeSavings in coppermine production
volumeAMITA supports drafting and implementation of environmental strategy that enhances its sustainability and boosts
enterprise value. Provided services to around 1,100 companies in 2015. In FY 2016, AMITA will expand its range ofstrategic support.
▶ See pp.10-23 for details about Environmental Strategy Design
Business.

379,072 t
16,596 t
43,349 t

AMITA contributes to reducing mining and the use ofnatural resources, promoting resource recycling by manufacturing and supplying terrestrial resources. The company
also contributes to preventing overfishing and sustainable
forestry management via environmental certification assessments, and to preservation of regional biodiversity via
technical training related to symbiotic farming.
▶ See p.37 for details about the environmental value AMITA creates.

Social capital

Number of users of group website

Fudenkan community space

30,000 570,000/year

Through its business activities AMITA promotes improvement in environmental value of the whole society, while
reducing environmental impacts caused by the activities ofcorporations and local municipalities.
Ex.: At Minamisanriku BIO, the company produces liquid
fertilizer and biogas from local food waste. The liquid fertilizer is used on local fields, while the biogas is used togenerate electricity. AMITA is working to construct a comprehensive cyclical system of resource usage in the area.

Number of visitors:▶See p.24 for details about AMITA’s initiatives in Minamisanriku.
▶ See p.37 for details about the environmental value AMITA creates.

*Calculated from Ni alternatives among specialty steel raw materials (Ni, etc.).
▶ See p.13 for details about AMITA’s production track record for all resources.

Email newsletter subscribers

AroundClient value

Natural capital

Actual figures for, and environmental contribution of AMITA’s four plants(No relevant products at Kyotango Resource Recycling Plant, Minamisanriku BIO)
Production volume
of cement substitutematerials▶See pp.30-31 for details on financial information.

around2,500

03

Interview

Bringing about the business recovery in 2016
— Specific measures to overcome problems and achieve sustained growth —Interviewer

AMITA HOLDINGS Co., Ltd.
Founder and CEO

Eisuke Kumano

AMITA HOLDINGS Co., Ltd
CFO

Taro Shimizu

AMITA HOLDINGS Co., Ltd.
Non-exective Director

Emile H. Ishida

What is the root cause of AMITA’s sluggish recent earnings? We spoke with Chairman and CEO Eisuke Kumano, Director and CFO Taro Shimizu, and External Director
Hideki Ishida about the fundamental structural issues facing the AMITA Group andmeasures to tackle them, and about how the company plans to achieve the targets in its
three-year plan announced in February 2016.
Date of the interview: Wednesday 27 January 2016

*See homepage (http://www.amita-hd.co.jp) for detailed information about the executives.

04

Interview

What is the structural root causethat has led to AMITA’s sluggish
earnings?
External Director Ishida (hereafter Ishida): Getting right to the point, the AMITA Group incurred
losses of ¥550mn in 2010, and although earnings
bounced back in 2011, earnings subsequently weresluggish. In FY 2015, the company booked net salesof ¥4.557bn, versus guidance of ¥4.757bn, and ordinary losses of ¥10mn, versus guidance that called
for ordinary income of ¥80mn. I’m aware that I also
bear responsibility as a member of the board, buttoday, I’m going to try and ask questions from an
objective standpoint. The main reason for the sluggish earnings this year is the delay in starting up
operations at the AMITA Taiwan Resource Recycling
Plant (hereafter the Taiwan plant). Chairman Kumano, what do you think about the structural issues
and fundamental reasons for the company’s sluggish
earnings over the past few years?
Chairman Kumano (hereafter Kumano): When I
visited all our bases in Japan and abroad and had alook around last year I noticed that many staff had
fallen into the “division of roles” trap.
Our employees all have a strong sense of responsibility and are very serious, but they are too focusedon “fulfilling their own responsibilities” and organizational capabilities are not being leveraged. This is
the case with teams and departments, and at subsidiaries. For example, one of AMITA’s strengths is that
we have a nationwide network of plants and sales
offices. However, at present we are not trying to expand value via mutual collaboration, and opportunity losses are arising due to insufficient information
sharing.

I think this is also the fundamental cause of the delays in new business development. As a result ofexcessive focus on carrying out individual tasks,
overall design and management is neglected.
In the Taiwan plant construction project, while eachteam leader and person responsible was doing all
they could to solve the various problems that arose
within the areas for which they were responsible, theproblems grew and it became impossible to avoid
delays when the situation was grasped at an organizational level.
In a bid to escape from a structure in which there
is a stubborn adherence to individual results rather
than the overall plan, we embarked on restructuring
in 2014 and ramped it up in 2015. This started tohave a visible impact in the second half of last year.
Ishida: I think this is quite a deeply rooted organizational problem at AMITA. Why did this attitude
spread through the company? And why did management not do something about it sooner?
Kumano: Since the 1970s, when AMITA was founded, many companies have copied efficient, smart European and US management methods. We chose notto, however. I think this nurtured our company spirit of helping each other, and a corporate culture ofmaking things we need by pooling our knowledge.
However, in 2006 after the company was listed, in abid to make business more efficient, we hired a lotof people who are very familiar with previous European and US management methods, and entrusted
the management of hived-off subsidiaries to thesepeople. Immediately after that, the subprime loan
problem arose, and amid a global financial crisis werealized that already we couldn’t compete using theold management techniques. Also, organizational
governance as a whole weakened due to spin-offs.
Realizing that this would not do, in 2010 we cutloose unprofitable businesses, merged subsidiaries
and so forth, but due to dividing businesses vertically and to spin-offs, regrettably the view took holdamong staff that they should “work within the limitsof their responsibility”. They ceased to care about
the bigger picture. There has been a recovery over
the years but that atmosphere has not been entirely
eliminated. As a result of demanding “efficient management” too strongly as a listed company, AMITA
has lost its original strength of “blending inconsistent individual resources to achieve the most appropriate, stable solution for the whole”.

Why results missed guidance, andregarding future measures
Ishida: It is true. Director Shimizu was the person
responsible when AMITA was listed and today as
CFO he is the person with overall responsibility
for the group’s finance. Why has the group not revamped its financial strategy in the face of sluggish
results over the past few years?
Director and CFO Shimizu (hereafter Shimizu):
AMITA has made a number of major business investments over the past few years, and the weighting ofinvestment in new business has become substantial
relative to profits. The main reason for the decline
in earnings during this period is that recouping investment in new business took longer than expected
as sales have been broadly flat. As a result, improvement in existing business, which is the company’sbusiness base, and investment in relatively lucrative
business dried up, resulting in a further deterioration in earnings.
Our financial department always considers three lev-05

els of targets:(1) Internal targets: Very high targets drawn up by
sales assuming all businesses go as planned.
(2) Targets the company should achieve: Obtained byreflecting historical results, various risks, and futurebusiness and funding plans in (1).
(3) Minimum targets: The lowest targets, obtained
assuming the worst case scenario with respect to uncertainties.
Target (2) above is the company’s official target forexternal consumption, but (1) is shared by all thecompany’s executives, who regularly check on progress with sales. Meanwhile, management also draws
up financial measures in case results only reach (3).
In recent years, AMITA has frequently revised guidance, which is very embarrassing as CFO. We havenot missed minimum targets, but it’s true that in

06

dealing with the problems that led us to achieve
only minimum targets, we have not taken the strategic financial steps we should have. From now on,
we intend via a companywide business revamp toincrease the precision and pace of development ofinvestment businesses, definitely hit the targets thecompany should achieve, and implement a more aggressive financial strategy as AMITA nears its internal targets.
Ishida: The company needs to forge closer links
between executives responsible for sales and development, and spread risk and danger management
methods from a financial perspective among local
staff, doesn’t it? Could you now please outline themeasures AMITA is taking to improve the “divisionof responsibility” trap into which AMITA staff havefallen and revamp outmoded working practices?
Kumano: Everyone understands that measures
are needed with regard to business that is poorly
cost-effective and delayed development projects.
However, using the methods employed to date canbe counterproductive in some cases.
Thus, although we have all been calling for innovative improvement measures since the Tohoku earthquake and tsunami, most team leaders only move
within the bounds of their experience.
Accordingly, from this year we have tried to move
personnel with specific experience-based ideas for
new measures into support roles, and have positioned people who are likely to come up with specific innovative measures at the centre of management.
Also, since FY 2015, we have been developing a service structure and creating added value. This year,
we revised the company’s structure to match.
We have created integrated manufacturing andsales teams that facilitate links between manufacturing and sales, strengthened our non-face-to-face,high-quality customer service division, and integrated client management, which was previously split
among offices.
The Regional Systems Design Business makes onlya modest contribution to earnings, but it is very effective from a PR standpoint in boosting enterprisevalue. So we plan to strengthen the PR transmission
structure at the parent company (AMITA HOLDINGS).

Strategy for turning a profit at the Regional Systems Design Business
Ishida: There are great expectations of the Regional
Systems Design Business, but it looks as though it isgoing to be some time before it actually becomes amajor source of earnings.
Kumano: We plan to develop the business in threestages. First, biogas-fuelled power generation facilities and liquid fertilizer. This started operatingin earnest in Minamisanriku in October last year.
Second, total recycling of waste in the region. We
are preparing for this, aiming to start the year after
next. Third, creation of industry in the region. We
have fielded a lot of inquiries about this model, andsupport for creating the vision in Kamimachi, Miyagi Prefecture has begun. Based on our track recordin Minamisanriku, we will strive to boost businessprofitability, including by working out the optimum
staffing levels for biogas business and considering ashift towards high earnings business such as accepting sludge and leftovers from local food processing
plants. If we realize this, it will also be possible tolink up and merge with the Environmental Strategy
Design Business’s recycling platform, considerably

Interview

broadening the scope of the company’s business. We
plan to form this local recycling model into a package and export it in a few years’ time.

Basis of the forecasts in
AMITA’s three-year plan
Ishida: Since the Regional Systems Design Businesswill not become a key source of profits unless weprovide it in a certain number of regions, it is time
to develop regions where we can win orders thatwill become strategic stock in a few years’ time.
It’s the same with strategy support for companies.
Drawing up plans for next year’s sales this year is
key as it takes time for orders to translate into actual
earnings in projects worth several tens of millions ofyen. We released a new three-year plan in February.
Let’s ask Director Shimizu how he sees AMITA’s
medium-term sales and profits.
Shimizu: We don’t expect substantial growth in thedomestic recycling market. We plan to boost overallsales and profits via business efficiency gains and by
expanding the range of services we offer. However,
we do expect major growth in overseas business inthe near term. We expect group operating income togrow ¥74mn in 2016-17 and ¥87mn in 2017-18.
We think some 70% of this will be due to the Taiwan
plant. Thus, earnings should steadily increase after
the plant starts operating this year, and we are aiming to further boost earnings from the second year inoperation by expanding facilities.
In addition, in domestic business, we are developing
plants and making existing facilities more efficient
via cooperation with partner companies, boostingearnings by reducing COGS and steadily improving

earnings by expanding consulting services. We expect these trends to continue. As regards consulting,
we have great expectations of The Sustainable Stage,a total environmental strategy support package westarted offering in February 2016.
*See pp.19-23 for details about The Sustainable Stage.

Boosting enterprise value
Ishida: It seems as though the Taiwan plant will be
key. AMITA’s business is ESG itself, which stands
for Environment, Social, and Governance. Thus
I believe the company should strengthen its own
ESG and proactively communicate our social value.
Won’t this lead to an increase in enterprise value
and be reflected in the share price?
Kumano: We’ve arrived in the era of enterprisevalue management. How AMITA, which proposesthat clients shift from boosting product value toincreasing enterprise value, increases its own enterprise value is key. For example, we are promoting so-called “company design”, in which aspectsof how a company is managed, such as systems enabling staff to bring children to work and systems
that provide ways of working to people who forvarious reasons find it hard to obtain employment,
are considered and then created. We want to continue striving to create a sustainable future in bothbusiness and corporate systems.
Ishida: AMITA is a company that thinks about andcreates an ideal society together with its clients.
However, as the company has grown, we decided totry and systematize our business, organization, andeven our people to achieve efficiency. Staff joined

in with this, and in a sense slacked off. I think thisis why we have arrived at a major turning point.
The main reason I became an AMITA executive isthat I thought the company was a leader in termsof grasping and understanding historical and social
developments. However, its ability in this regard is
now waning. I think AMITA will change enormously if it returns to first principles and improves andrestructures, re-incorporating its original characterin staff development and organizational changes.
It’s not easy to inject life and soul simply by making
organizational changes. I think that is the role of thecompany’s directors. Thank you.

07

Business Domains of the AMITA Group
Promoting sustainable resource and energy usage through the harnessingof neglected resources.

Environmental Strategy
Design Business

Regional Systems
Design Business

Environmental
Business Outsourcing

Improving compliance

Supporting primary industries

Promoting material andenergy self-sufficiency

08

Producing biogas
and fertilizer fromfood waste

Preserving natural resources

Green energy usage

100% recyclingof waste

Building a new social system

The group’s core business, accounting for 90% of net sales

Future development business due to get under way in earnest in FY 2016

Supports planning and implementation of corporate environmental strategies and making industry more environmentally friendly.

Creates thriving regions that connect people with natureby harnessing neglected local resources.

Corporate services

Services for regions

Environmental Strategy
Design Business

Regional Systems
Design Business

Solves social issues and boosts corporate sustainability via environmental strategy support. Realizes increases in companies’ social value via comprehensive
support from environmental strategy planning to environmental management
outsourcing, sustainable procurement, environmental risk consulting, environPHQWDOFHUWLoFDWLRQDXGLWVDVVHVVPHQWVDQGZDVWHUHF\FOLQJ

The AMITA Group supports creation of compact autonomous regions that harness
neglected local resources. Designs regions where people can live with peace of mind
and builds resources, economy, employment, and rich human relationships byconstructing a Comprehensive Cyclical System of Resource Usage using social technology including biogas plants, symbiotic farming, fuel production from neglectedmaterial resources and waste, and local production and consumption of energy.

6SHFLoFVHUYLFHV

6SHFLoFVHUYLFHVStrategic planningsupportEnvironmental strategy
planning support

Strategy implementation supportv UHF\FOLQJ RI
waste
v5HF\FOLQJ VXSSRUWvia networksv ( Q Y L U R Q P H Q W D Omanagement outsourcing
v(QYLURQPHQWDO ULVN
reduction consulting

v&65DFWLYLWLHV
consulting
v&65DQGHQYLURQPHQtal marketing support
v6XSSRUW IRU DGRSWLRQ
of IT platforms in environmental managementv)RUHVWU\oVKHULHV&HUWLoFDWLRQ
v6DOHVDQGSXUFKDVHVRI
green electric power,
etc.

Supporting strategicplanning

Supporting urban
planning

Supporting strategy
implementation

v+DUQHVVLQJQHJOHFWHGUHJLRQDO
resources(household waste, sewage sludge,
timber offcuts, etc.)
v%LRJDVSRZHUJHQHUDWLRQ
v6XSSRUWLQJV\PELRWLFIDUPLQJHWF

Details from p.10

Date
創業期
established
Resources
資源
tradingcompany
商社

1992
1992年

Around 1998
1998年ごろAround 20072007年ごろ資源
Resources
tradingcompany
商社

地上資源
Terrestrial
Resources
Business
事業

地上資源 resources
Terrestrial
manufacturing
製造

環境SL
Environmental
SL
Business
事業

2013
2013年

2015
2015年

Terrestrial
Resources Business
地上資源事業

Terrestrial
Resources Business
地上資源事業

Environmental
SL Business
環境SL事業

Information
Resources Business
情報資源事業Natural Products Business
自然産業事業

Regional
Resources Business
地域資源事業*Only major events noted from establishment through 2013.

Details from p.24

2016年
・
・
・
・
・
・
・
・2029年
2016・
・
・
・
・
・
・
・
2029

Environmental
Strategy
環境戦略デザイン事業 Design Business
Regional Systems
地域デザイ
ン事業Design Business

From 2030
2030年〜SocialDesign
社会デザイ
ン
Business
事業

The AMITA Group was originally established in 1977 as a metal
resources trading company. The group has revised its businessdomains as it has developed with the changing of the times. By
2030, we plan to merge the functions of the current Environmental Strategy Design Business and Regional Systems Design
Business and develop a Social Design Business which forms richsocieties that connect people with nature.

09

Business
Topics 2015

topic

Environmental
Strategy Design
Business01

Pr omote mar k eting of Be s t Wa y to Ma n a g e Wa s te

The support tailored to clients’ needs
offered via this service released in
FY2014, including risk reduction,
PDQDJHPHQWHIoFLHQF\JDLQVDQGUH
alization of knowledge transmission,
has been positively received. In FY 2015, net sales came toroughly double the ¥25mn target, due mainly to growth in
the number of companies that introduced our services andbundled orders for other services due to the introduction of
the main services.
Demand for outsourcing of specialized management at companies is expected to grow, and AMITA aims to widen therange of outsourcing services it provides in the environmenWDODQG&65oHOGVFY 2015 results
FY 2015 target net sales¥25mn

FY 2015 net sales*¥50mn*Includes bundled orders for other services due
to Best Way to Manage Waste orders.

Supplied from FY 2016 as part of the The Sustainable
Stage program total service for corporations.
▶ For details about Best Way to Manage Waste see p.22.
▶ For details about The Sustainable Stage program see pp.19-23.

topic

02

Opening of AMITA Terrestrial Resources Development Partners

Since 2013, AMITA has been developing AMITA Terrestrial
Resources Developmentng Partners, a network of companies
that provide 100% recycling technologies. As a result, it became
possible to rapidly develop AMITA-quality recycling bases
QDWLRQZLGH,WDOVREHQHoWWHGFOLHQWVLQUHJLRQVZLWKQRQHDUE\AMITA plant by reducing transportation costs.

Start of operation of
FUJI TRANSPORT Co., Ltd. Recyclable Resources Plant
T he s e co nd pa r t ne r pl a nt
after AICHIKAIUN Co.,Ltd.’s
Gamagori Recycle S.C. (Aichi
Prefecture), FUJI TRANSPORT
Co., Ltd.’s Recycle Resources
Plant (Niigata Prefecture) started operating in June 2015. The
plant is promoting recycling in
the Hokushinetsu region.

10

AMITA’s resource manufacturing platform, which supports
manufacturing in the environmental era.
Map of Resource Recycling Plant, recycling facilities, and offices
As of March 2016

AMITA Terrestrial Resources Development Partners
FUJI TRANSPORT Co., Ltd.’s Recycle Resources Plant
AMITA CORPORATION Kyotango Resource Recycling Plant(Kyotango City Eco Energy Center)
AMITA CORPORATION Himeji Resource Recycling Plant
AMITA CORPORATION
Kitakyushu Resource Recycling Plant

AMITA CORPORATION Minamisanriku BIO
Started operating in October 2015

AMITA CORPORATION Ibaraki Resource Recycling Plant
AMITA CORPORATION Kawasaki Resource Recycling Plant
AMITA Terrestrial Resources Development Partners
AICHIKAIUN Co.,Ltd.’s Gamagori Recycling Service Center

AMITA CORPORATION Resource Recycling Plant

Taiwan Resource Recycling Plant
Opened in March 2016

AMITA CORPORATION Offices
AMITA Terrestrial Resources Development Partners recycling facilities

03

Delay in start of operation of Taiwan Resource
Recycling Plant

The Taiwan Resource Recycling Plant was due tostart operating in FY 2015. However, due mainly
to local administrative procedures there was adelay, and the plant actually started operating on
24 March 2016. The plant manufactures recycled
products such as silicon metal and recycled coolant made from liquid waste generated in the solar
panel manufacturing process. It is aiming for FY
2016 net sales of ¥210mn.
Following the survey we conducted in FY 2014, we
also conducted an investigation into the feasibilityof turning waste recycling, resource recycling systems and the like into businesses in Malaysia, Palau, Vietnam, Indonesia, and Thailand. Especiallyin Malaysia, we are engaged in business preparation including tie-ups with local companies in advance of construction of recycling plants, following
construction of the plant in Taiwan.

topic

04

Taiwan Resource Recycling Plant▶See pp.14-15 for details about overseas development.

Environmental strategy support seminars and productdevelopment

We held six seminars for corporate senior
executives and managers of environmental
divisions in Tokyo, Osaka, and Fukuoka on
the theme of sustainable corporate growth under environmental constraints. More than 400
people attended. Surveys completed on the
day and subsequent interviews and marketing
revealed strong corporate demand for environmental strategy planning with an eye on futureenvironmental constraints.
Accordingly, in the second half of 2015, wedeveloped The Sustainable Stage program total service that supports sustainable corporate
development. We started offering it to clientsin February 2016.

Environmental Strategy Support Seminar looking ahead to2030, held in Tokyo in June 2015
▶See pp.19-23 for more details about The Sustainable
Stage program.

topic

05

Kawasaki and Kitakyushu Resource Recycling Plants
obtained superior certification

In 2015, AMITA’s Kawasaki and Kitakyushu Resource Recycling Plants obtained
the certification system for businesses
detoxifying waste from the local governments in recognition of their stable andsecure operation since 2010 when they
opened.
The five-year approval usually granted
to industrial waste disposal companies
becomes valid for seven years when companies are so recognized. Such recognition
can also be the deciding factor in client
selection of a disposal company.
AMITA intends to maintain its efforts interms of compliance and safety measures
so that clients can continue to use it withfull confidence in the company.

topic

06

Environmental Strategy Design Business

topic

Kawasaki Resource Recycling Plant▶See p.13 for details about recycling plant results, and p.36
for details of AMITA’s efforts with respect to plant safety.

Implemented first-ever ASC Certification assessment
in Japan

In November 2015, AMITA conducted the first
ASC aquaculture certification assessment in Japan at an oyster farm in Minamisanriku, Miyagi
3UHIHFWXUH7KHIDUPZDVDZDUGHGFHUWLoFDWLRQLQ
2016.
$6&&HUWLoFDWLRQLVDQLQWHUQDWLRQDOFHUWLoFDWLRQ
system which certifies whether fish farms' environmental and social aspects comply with standards of sustainable management. Aquaculture is
growing and developing worldwide. The numberof companies in Japan that have obtained ASC$TXDFXOWXUH&HUWLoFDWLRQLVH[SHFWHGWRJURZLQthe run-up to the 2020 Tokyo Olympics.
AMITA is already an ASC COC certifying bodythat inspects manufacture, processing, and distriEXWLRQ$VDUHVXOWRILWVODWHVWFHUWLoFDWLRQLWKDV
become Japan’s sole certifying body that assess allstages from manufacture through to distribution.

Assessment under way in Minamisanriku, Miyagi Prefecture▶6HHSIRUGHWDLOVDERXWFHUWLoFDWLRQVHUYLFHUHVXOWVSfor details about Minamisanriku’s efforts.

11Performancein 2015

FY 2015 Environmental Strategy Design Business results

Comprehensive support for client companies· environmental initiatives
Environmental strategy implementation support service provision results *Clients include local governments.
Environmental risk management/consultingOutsourcing(including partial outsourcing)Training support(seminars, education, training)

$MITA’s free information service

Page views*

No. of consulting service client companies:
38 (+20 increase) in 201458

No. of outsourcing companies:
14 (+1 increase) in 2014

Services provided

:DVWH0DQDJHPHQW2SHUDWLRQV
Visibility
(QYLURQPHQWDOPDUNHWVXUYH\V/
consulting
&RPSOLDQFHFRQVXOWLQJHWF.

:DVWHPDQDJHPHQWRSHUDWLRQV%32
%HVW:D\WR0DQDJH:DVWH 

Number of user places of business
1200
289
Number ofuser companies

1000

Number of user
places of business

236
214

200

800

163
150
100
50
0

600

119

companies

Services provided

2015
Around

1.5 mn2.0 mnUsers*

AroundAround389,000

570,000

Number of recipientsof information

AroundAround25,00030,000*Actual results with respect to group website.

In FY 2015, we laid the groundwork for a revampof group websites and the "Daily AMITA Update"website. In addition, free information service circulation and views of web-based media increased
needs-grasped via face-to-face and indirect marketing-in our content. The marketing capabilitiesof the group as a whole have improved.

FSC® FM Certification
System of certifying foreststhat are appropriately
managed

FSC® COC Certification

MSC COC Certification

A system for certifying the manufacture,
A system for certifying the manufacture,processing and transportation of products madeprocessing, and transportation of
from lumber derived from FM certified forests. appropriately managed marine products

Area AMITA handles

Cases handled by AMITA

Cases handled by AMITA

268,788ha

229

44

Total area of certified woodland in Japan

Total certified location in Japan

Total certified location in Japan

393,243ha

1,046

400

77

5,000
46

:DVWHPDQDJHPHQWODZDQGSUDF
tices seminar
%LRGLYHUVLW\VHPLQDU
(QYLURQPHQWDOODZVHPLQDUHWF

6HHSIRUUHVXOWVIRU%HVW:D\WR0DQDJH
:DVWHDORQH

Number of user companies/places of business

59

On-demand training:

:DVWHGDWDPDQDJHPHQW
'RFXPHQWPDQDJHPHQWHWF

Number of user companies
300
250

Seminars held:

Seminar attendees: around

Services provided

Digital waste management system

Number of companies thatuse
multiple services
複合サービス提供企業数
100

77(As of end-December 2015)

66

75

80

2013

2014

2015

50

Net increase (decline) in 2015

45

200

135
13
5

428
42
8

543
54
3

651
65
1

775
77
5

851

1137

2009

2010

2011

2012

2013

2014

2015

Penetration among top 20 environmental brand companies (2015)*Based on Nikkei Business Publications
Eco-brand Survey 2015.Regarded as anindicator, although ranking changes
every year.

12

15

2014
Around7companies
20companies

FSC ® Certification
FSC ® FM0

Introduction

Japan
AMITA

0
(Increase 2 / decline 2)ïFSC® COCMSC COC

ï52

10

ï16

3

ASC COC
13(Increase 13 / decline 0)

4(Increase 1 / decline 2) (Increase 14 / decline 30) (Increase 4 / decline 1) (Increase 4 / decline 0)

in Minamisanriku, Miyagi Prefecture. In 2016, it was recognized

AMITA comprehensively supports the implementation of client companies’ environmental plans. The number of companies that haveversus last year to 80. The total number of thegroup’s clients is 1,154 companies.

Environmental Strategy Design Business

Performance of resource recycling plants&KDQJHLQFDORULoFFHPHQWUDZ
materials output（t ）150,000
120,000

136,514

146,341

158,624
136,632 138,751

150,646

Cement raw
material

150,646 t

90,0004,000(Ni, etc.)

3,000

1,500

FY 2010

11

12

13

14

15

*Includes production
at AMITA Terrestrial
Resources Development Partners.

The recycling plant of a partner company in Niigata started operating in June 2015. However, overall production volume has since
fallen slightly due to a decline in volume handled and in the number of companies that receive the products.
▶See p.23 for details about efforts to boost production volume.

Change in production volume at each
recycling plant
120,000

Ibaraki Resource Recycling Plant
Kawasaki Resource Recycling Plant

100,000

Himeji Resource Recycling Plant
Kitakyushu Resource Recycling Plant

80,000Terrestrial Resources Development
Partners plants

60,00040,000

Metal (Cu)

3,500
2,675

2,000

30,0000（t）4,500 Specialty steel materials

2,500

60,000Total amount of electric power generated
and liquid fertilizer produced

Change in metal raw
materials output

1,000

1,284

2,758

1,497

4,398

4,305 t11（k W h ）1,600,000

Liquid fertilizer
production (t)1,400,000

Power generated(kWh)1,200,000

12

800,000

Metal (Cu)

1,403

13

737

717

0

15

Production volume of specialty steel raw materials (Ni, etc.) and
PHWDOPDWHULDOV &X KDVWUDFNHGEURDGO\pDW,QZHGHYHORSHG
new metal raw materials and started to supply them to clients.

Types ofby-products andresidues handled

2,238

Business
partner sites
served963

11

FY 2010

11

12

13

14

15

Manufacturing costs at Himeji Resource Recycling Plant rose due
to demands for higher product standards of recycled resource.
Production volume has also fallen due to a decline in volumes
received by big clients and business partners. At Kitakyushu Resource Recycling Plant, volumes received increased due to favourable geography, and production volume has continued to rise.

Stable supply ofrecycled resources

Number of user
companies to which
AMITA supplies products

37

Recycling network companies
Types ofby-products andresidues handled

511

Business
partner sites
served

313

4,000
3,000
2,000

12

13

14

15

0

8000
7000

Liquid fertilizer
6000

7,993
5000t
4000

Power generated
3000
2000kWh
686,000
1000

0

In October 2015, Minamisanriku BIO started operating. Meanwhile,liquid fertilizer was used more extensively near Kyotango Resource Recycling Plant (Kyotango City Eco Energy Center*), with the result thatliquid fertilizer production volume increased.
*The AMITA Group runs the Kyotango City Eco Energy Center as thedesignated operater.

20,000
0

5,000

3,883

1,000

Business Accomplishments
FY 2015
100% recycling at AMITA’s own
plants and those of partners

6,000

280
10

（t ）
8,000
7,000

1,849

400,000
200,000

14

3,551

600,000

717t

7,993

5,268

1,000,000

679
FY 2010Specialty steel
materials (Ni, etc.)

3,072

500
0

4,201

(Kyotango Resource Recycling Plant and Minamisanriku BIO)

4,305

*Results via agency that links
companies that generate wastewith more than 300 partnercompanies nationwide.

art
to st
Due 2016
inTotal service that supports sustained
corporate and social development"The Sustainable Stage"
A comprehensive service that supports client companies from environmental strategy
planning through implementation, started
in 2015. Went into full-scale operation in
February 2016.
Development resu lts
2015: Supplied model to two companies
2016: Started full-scale expansion(see pp.19-23 for details)

13Overseas
Project 2015

Overseas business development

March 2016: Taiwan Resource Recycling Plant, AMITA’s first overseas
manufacturing plant, opened for business
In March 2016, the AMITA Group opened a new manufacturing plant in Taiwan in order to develop in
overseas markets, especially rapidly growing Asia, the 100% industrial waste recycling technology it
has nurtured in Japan since Japan’s period of rapid economic growth.
The plant recycles silicon slurry waste from solar panel manufacturing in Taiwan and sells it to user
companies (in Japan, Taiwan, and elsewhere) as a resource.

B u s i ne s s mo d e l i n Taiw an

Waste generators

Silicon metal,
recycled coolant

Silicon slurry
waste, etc.

Solar panel
makers

Product flow

User companies

100% recycling

Sce nari o fo re cas ts f or t h e c umulat iv e market f ors o l ar p o we r ge ne ra t ion syst ems worldw ide
The global solar power generation system market is still expected to grow substantially andis currently expanding in China
and India in addition to in Europe, North America, and Japan.
Against this background, production volume is also expected toincrease in Taiwan, which has an
around 16% share of global solar
cell production (FY 2013 data).

（MW）
600,000

540,009

Low-growth scenario
500,000

High-growth scenario
Medium-growth scenario

400,000

Local company nameAMITA TAIWAN CORPORATION

Location

Changhua County Taiwan (R.O.C.)

Area

6,976m 2

Date opened

March 2016

Items accepted

Silicon slurry waste

Products manufactured

Silicon metal, recycled coolant

Investment

Around ¥407mn (forecast)*Additional investment to be decided in stages
depending on results and market conditions

300,000
178,391

200,000
100,000
0

2010

2011

2012

2013

2014

2015

2016

2017

2018

EPIA (Global Market Outlook For Solar Power/2015-2019)14

Taiwan Resource Recycling Plant

2019

Net sales targets

2016: ¥210mn 2017: ¥370mn
2018: ¥540mn

Taiw an ( op ened i n M a r c h 2 0 1 6 )Following Taiwan and Malaysia, the AMITA Group is currently conducting surveys
seeking business development possibilities mainly in countries in Southeast Asia.
It is looking at production and disposal of industrial waste in each country, and at
how technology and expertise built up in Japan to date could be used there.

AMITA has established a business in Taiwan, where around 16% of the world’s solar cells are
made, fully recycling the silicon slurry waste generated in the manufacturing process (see p.14 for details).

Current situation

There are many local waste disposal companies. However, few have the technology to fully
recycle waste including recycling by-products, and we think AMITA has a considerable
advantage here.

AMITA has been commissioned by Japan’s Ministry of the Environment to conduct
FY 2015 Feasibility Studies on Joint Crediting Mechanism (JCM) Projects in Indonesia, Thailand, and Vietnam, to help realize a low-carbon society in Asia. The company is conducting surveys aimed at commercialization in all three countries.

Survey details
1. Consider candidate users of recycled products
2. Survey target waste
3. Survey and classify relevant laws and regulations
4. Feasibility survey including economic aspects
5. Consider tie-ups with existing companies and obtain legal licence to operate, etc.

Environmental Strategy Design BusinessIndonesia, Thailand, Vietnam (surveys in progress)

Key points

Operational structure
Dispatch a Japanese engineer and hire several workers locally.
In addition, during the start-up phase, dispatch one person with responsibility for overseas
business who supervises how the business progresses.

M a la y s i a (ai mi ng fo r s tart-up in 2016- 17)
AMITA is in the final stages of preparing to develop waste cement recycling business via a
joint venture with a local company, aiming for construction to be completed in FY 2016-17.

Key points
Malaysia is aiming for a recycling rate of 22% by 2020. More than 90% of waste is currently
incinerated or goes to landfill. We therefore believe there is strong demand for AMITA’s
100% recycling technology, especially among Japanese companies operating in the country.

How AMITA will progress the project through to starting the business
Leveraging experiences gained when the company moved into the Taiwanese market, AMITA will reduce legal and administrative risk by exchanging information with related plants,
including plants operated by local companies. It will also host seminars, especially for Japanese companies, establishing a path toward them becoming clients, thereby securing input
sources and output products.

15

Case Studyin 2015

Client interview – 01

AMITA is your partner in "creating" and "expanding"the environmental cities of the future
Kitakyushu City was a driver of Japan’s industrial development in the early 20th century. However, it also faced serious problems
with pollution. Today, these problems have been overcome due to efforts both in the public and private sectors, and various steps arebeing taken to spread, both in Japan and overseas, the expertise and networks built up in the course of overcoming the problems. As
a partner in realizing these efforts, AMITA is involved in various initiatives including Kitakyushu Eco-town (a major centre of environmental industry) via the establishment of the AMITA Kitakyushu Resource Recycling Plant, and by being commissioned by the
Ministry of the Environment to come up with joint proposals for surveys aimed at commercialization of recycling industry overseas.
We spoke with Kengo Ishida of the Kitakyushu Asian Center for Low Carbon Society about AMITA’s relationship with Kitakyushu
City and the outlook for the future.

Joint efforts by industry,the government,
and academia are key to realizing an "eco-town".
We see three key points with regard to promoting the realization of a recycling-oriented society.

1

Establishing laws andregulations to recycle
waste

2

Support from companies thatpossess outstanding recycling
technology and provide
wide-ranging ongoing services

3

Developing new resource
recycling technology via
academic approaches

Executive Director, Kitakyushu Asian Center for Low Carbon Society,
Environment Bureau, City of Kitakyushu

Kengo Ishida

Looking to become
an international resource recycling baseKitakyushu City is aggressively promoting international environmental business cantered on
rapidly growing Asia, leveraging partnerships with companies, local governments, and research organizations, and technology and expertise acquired in the process of overcoming its
own pollution problems. We aim to contribute internationally on the environmental front andboost Kitakyushu City’s presence as a "green city" both in Japan and overseas by supporting
the international development of the city’s outstanding environmental industry companies.
In particular, as we think AMITA’s 100% recycling technology is extremely advanced, we
intend to support overseas development leveraging our network as an administrative body.

Key examples of links between AMITA and Kitakyushu City
Partly because Kitakyushu City overcame serious pollution problems, many companies that possess outstanding recycling technology are concentrated in the city. Kitakyushu Eco-Town is the heart of industrial development over a wide area, centred on Kitakyushu City, and of waste processing and recycling
into resources. I think the 100% recycling technology of AMITA, which has joined the project, is key bothin terms of promoting zero emissions and in relation to the issue of exhaustion of natural resources.
Local residents are concerned about the burden on the environment of waste recycling. However, AMITA is also cooperating in efforts
to raise local residents’ environmental awareness, including by
accepting requests for periodic
inspections. Companies that havevarious recycling technologies
such as AMITA are participating in
Kitakyushu Eco-Town and intend
to create "an Eco-Model City underJapan’s Future City Initiative" they
can be proud of via mutual ties between industry, government, and
The AMITA Kitakyushu Resource Recycling Plant in Kitakyushu
academia.
Eco-Town, where various recycling industries are concentrated

16vAMITA Kitakyushu Resource Recycling Plant in Kitakyushu Eco-Town (2010- )vWinning of order to conduct feasibility study for JCM project in cooperation with various bodies including Kitakyushu City (2013- )vWinning of order to conduct feasibility study of Ministry of the Environment overseas commercialization project jointly with Kitakyushu City (2013- )Formation of inter-government, inter-city cooperation platform
Inter-city
linksPartner country
governments

Kitakyushu
City

Partner cities

Inter-company links
Localcompanies

Approval, support
as national project

Businessdevelopment via
public-private
partnershipJapanesegovernment

Japanesecompanies

Support from behind via discussion, agreement between governments, etc.

Client interview – 02
Environmental Strategy Design BusinessTotal support of "corporate activity = environmental activity"
Kyokuto Kaihatsu Kogyo Co., Ltd. is developing business closely related to the environment, including manufacturing of special vehicles such as waste collection trucks, and construction and operation of recycling facilities. The company is currently
striving to standardize and stabilize environmental business on a companywide basis and establish and implement CSR activities and environmental strategies linked with its business. We spoke with staff from the company’s headquarters, and leaders ofindividual bases which AMITA has been supporting, who outlined how they see things from their perspectives.

Headquarters

Bases

vEstablishing and promoting CSR activities
integrated into core business
vCSR education for all employees

vEngaged in appropriate and efficient waste
management businessvImplementing CSR activities in correlation
with the headquarters

Supporting drawing up and implementation of companywide policies

Support for efforts that match companywide
policies and conditions at individual bases

HQ-led, unique planning and execution of CSR
activities and environmental strategies!
Client problems+HDGRI&65RIoFH &KLHIFOHUN&65RIoFH

Hideki Oka

Saori Murasawa

Reducing business risk and burden via theintroduction of systems and compliance checks!

Services provided by AMITA

Client problems

Services provided by AMITA

Improving employees’ CSR and environmental awarenessOn-demand CSR training
Details: “CSR basics: CSV”

$SSRLQWLQJDVSHFLoFSHUVRQWR
be responsible for waste management business and securing
time for management business

Waste management system
Digital waste management
systemInformation gathering
supporting environmental strategy planning

Free information supply service
Ex.: Environmental strategy
seminar looking ahead to 2030

Reducing compliance risk
when concluding disposal
contracts

Support for document preparation and project compliancechecks ahead of conclusion ofwaste disposal contracts

We intend to lead companywide environmental
activities via implementation of ISO14001 standards and promote unique CSR activities and environmental strategies. To achieve this, the CSR
RIoFHQHHGVWRWDNHWKHOHDGLQERRVWLQJLQWHUQDO
awareness and proposing and promoting environmental activities closely linked with business.
In June (designated Environment Month inJapan), AMITA provided CSR training at thecompany headquarters as one of the activities
designed to boost internal awareness. The training covered everything from CSR basics throughto the latest trends, deepening employee awareness. We hope employees will come to view CSR

activities as “part of business” rather than “voluntary”.
We use AMITA’s information service to gather
information needed in environmental strategy
planning. For example, in 2015, Kyokuto participated in the “Environmental Strategy Support
Seminar looking ahead to 2030”. The seminar
was extremely useful. We learned about how
companies should act under future social conditions and ways of thinking when planningenvironmental strategies. We intend to continue
to promote environmental efforts, together withother departments, to more closely link the environment with our business.

Chief clerk, management section, Miki plant

Nobumoto Kasahara

As I was the person chiefly responsible forwaste management at the Miki plant at the time,
I wasn’t able to get around to doing my own
management work. Although doing existing
work more efficiently was a major preconditionof dealing with new work that arose in those circumstances, we couldn’t neglect risk managementwith respect to breaching laws and ordnances.
So we introduced AMITA’s digital waste management system, and while standardizing work and
GRLQJLWPRUHHIoFLHQWO\ZHDOVRVWURYHWRUHGXFH
risk of breaching laws and ordnances as a resultof human error.
We also asked AMITA to draw up documentation

for the conclusion of contracts and conduct compliance checks of contracts exchanged up untilthat date. This is because up until then we had
used contracts in the form supplied by business
partners, so the conditions and items in the conWUDFWVZHUHQRWVWDQGDUGL]HGPDNLQJLWGLIoFXOWWR
compare them with the details of other contracts.
AMITA proposed standardizing contracts as asolution to this problem. This made it easy to
FRQoUPFRQWUDFWGHWDLOVPDNLQJWKHSURFHVVPRUH
HIoFLHQW,WDOVRUHGXFHGULVNRIYLRODWLQJODZVDQG
ordnances. Helped by AMITA’s reliable support,
we can now also focus on our primary management business.

17

Approach andProgress
in 2015

Review of FY 2015 efforts

New service Best Way to Manage Waste was received positively.
Also tapped new client needs
Waste management outsourcing and ancillary service orders were firm in FY 2015.
In recycling-related services, although new applications were developed for recycled resources, overall volumes handled declined. We clarified client needs in terms of responding to future environmental constraints via market development seminars.
Three key measures

Results in 2015v)8-, 75$163257 &R /WG 5HF\FOH 5HVRXUFes Plant, a member of Terrestrial Resources
Development Partners that used AMITA recyProvision of stable andcling technology, operates in Niigata (June).
secure recycling services
v6HFXULQJFOLHQWVIRUUHF\FOHGUHVRXUFHVLQFOXGing in Hokkaido and Tohoku.
v7RWDOYROXPHVKDQGOHGGHFOLQHG

Evaluation

ColumnGrowing need for environmental strategy
As mentioned in business topics, we hosted environmental strategy support seminars
in 2015. Participant surveys revealed the main issues to be "environmental initiatives
on the defensive", "environmental forecasts", and "links to products and services".

△

Opinions of seminar participants(issues associated with eﬀorts with respect to environmental strategy)

Environmental initiatives on the defensive
Examining and forecasting future environmental constraints and social trends
Links to management and business strategy and products and services
Shortage of labour for strategic planning
Shortage of labour for strategy implementation
Environmental strategy PR, and efforts in this area

v:H LQWHUYLHZHG -DSDQHVH UDZ PDWHULDOV PDNers about the materials they needed and as
a result of developing new applications for
Reduction in productrecycled resources we successfully developed
development and recythree types of product including a calcium
cling costs
substitute for steel and non-ferrous metal
manufacturers. Developments in the use ofwaste composed of ingredients not handled todate.
v5HGXFHG UHF\FOLQJ FRVWV LQ 7RKRNX YLD RSHUDWLRQ RI )8-, 75$163257 &R /WG 5HF\FOHResources Plant.

Strengthen environmental
strategy support

The number of companies using Best Way
to Manage Waste increased and we promoted contracted ancillary work. Achieved net
sales totalling around ¥50mn versus target of¥25mn.
As a result of holding six environmental strategy support seminars in three locations in Japan,
we clarified the latest needs of corporate clientsand decided to develop The Sustainable Stage, a
new service. (Provision of the service started in
February 2016)

18

0

25

50

75

100 (persons)*N=183 From results of surveys of middle management who attended AMITA’s environmental strategy support seminars△◎

Since 2011, due to the substantial global risk they pose, environmental issues havebeen high on the list of topics at the Davos World Economic Forum, where theworld’s leaders meet. This implies that the environment has steadily risen up theranks of corporate management issues.
2009

2010

2011

2012

2013

2014

2015

1st

Collapse of
asset values

Collapse of
asset values

FinancialcrisisCollapse of
asset values

Collapse of
asset values

Collapse of
asset values

Watercrisis2nd

Curbs onglobalization(industrializedcountries)

Curbs onglobalization(industrializedcountries)

Damagecaused byclimatechangeWater
supplycrisisWater
supplycrisisClimatechangeRapid
spread ofinfectious
disease overa wide area

Sharp rises
3rd in oil & gas
prices

Sharp rises
in oil & gas
pricesGeopolitical
FRQpLFWV

Food
shortagecrisisLong-termoQDQFLDO
imbalances

WatercrisisWeaponsof mass
destruction■ Economic ■ Environmental ■ Geopolitical ■ Social
From Global Risks 2015 10th Edition (World Economic Forum)

Start of provision of new service The Sustainable Stage
Environmental Strategy Design Business

In February 2016, the AMITA Group started to provide a comprehensive service called The Sustainable Stage through which it supports
corporate sustainable development under future environmental constraints.

Background to development
Corporate environmental strategy has entered a period of change
Environmental strategy to date

Environmental strategy from now on≒ Mainly strategy for “the environment”≒ Strategy that has been sublimated into a business model

Environmental strategy issues as revealed via
interviews with companies

12
3

Key conditions for environmental strategy from now on
Environmental and CSR efforts are
separate from business activities

Meeting various standards such as ISO has become the aim. The original aim has been lost.
Evaluation of the impact of environmental
HIIRUWVRQoQDQFLDODQGQRQoQDQFLDOLQIRUPDWLRQLVLQVXIoFLHQW

Developments in Japan

Strategies have not been drawn up or triedthat would boost enterprise value and lead to
a competitive advantage and development of
new markets.

Reference
The eco-productdilemmaClaimed to be "energy
saving", per-household
home electronics penetration has increased
sharply, resulting in
growth in CO2 emissions
from households.

80
60

Global developments
Growth in the world’s population
Exhaustion and concentration ofnatural resources
Climate change, etc.

Business
activities

Environment
and CSR％

Change in CO 2 emissions
by source in Japan

Businesses
Households

Declining population
Shortening of the productcycle, etc.

How companies should
strive to be

Environmental strategy planning and implementation thatmeets the following conditions will be demanded from now
on, not just from environmental departments, but also with
input from administration, production, and sales divisions.

1
2

Not contradicting management strategy, but
united with it.
Factors in the impact of
future environmental
constraints.

3
4

Contributes to improved
sustainability of one’s own
company and society.
Can evaluate the impactof efforts on enterprisevalue.

Improve sustainability of own
company and society

40

Minimum resources andenergy input

20
Transportation0

Industry

-20
1990

2000

2010

2012

⇒Sustainable procurement⇒Product design that considers the environment⇒Active use of recycledresources, etc.

Resolution of social issues
Provision of products and services
Business activities

Minimum environmental burden⇒Reduce waste volume, fully recycle⇒Reduce CO2 emissions⇒Reduce waste water
volume, etc.

Source: Greenhouse gas emissions in Japan, National environment research institute (NIES, Japan)

19

A total service that supports sustainable corporate development

The Sustainable Stage
What is The Sustainable Stage?
The Sustainable Stage is a program to boost enterprise value by solving social problems through business activities andguaranteeing business sustainability even under strict environmental constraints.

S er v i c e ou t lin e
The Sustainable Stage is divided into four major stages.

Company senior executives, department heads

Retranslates corporate missions and philosophies, bringing them up to date.

StagesSustainable
management
perspective

Mai n ta r ge ts

Support for boosting enterprise value

Drama Stage

Drama Stage

Support for boosting
enterprise value

Creating a style that generates sympathy
A moving vision

Period provided(rough guide)
Fee (rough guide)

Sustainable strategy support

Strategy Stage
Support for strategy planning and plan formulation to boost enterprise value

Around 3-6
monthsFrom ¥5mn

Strategy Stage

Sustainable strategy support
Period provided(rough guide)
Fee (rough guide)

Around 8-15
monthsFrom ¥10mn

Example$PLVVLRQVXFKDVSURYLGHDpRXULVKLQJOLIHVW\OH⇒What is genuine prosperity today, and what will it be in the future?
What will a sustainable lifestyle be in a given era?
How can we realize that in our products and services?
We clarify such questions specifically and in structural terms
and draw up a moving vision.

Mai n ta r ge ts

Compan y manager s, depar tment h eads

We design business and business models companies should aim for and proYLGHVXSSRUWIRUSODQQLQJVSHFLoFVWUDWHJLHVWRUHDOL]HWKHVHDLPVGUDZLQJXS
roadmaps, etc., using both backcasting, which involves forecasting changes inthe business environment including environmental constraints and technological advances, and forecasting, i.e., thinking about the future based on current
business conditions.

Environmental tactics support

Solution Stage
Support for activities to improve and solve
problems that impact corporate sustainability

Solution Stage

Environmental tactics support

Operation Stage

Environmental activity support
Environmental activity support
Actualwork efforts
perspective

20

Operation Stage
Partner based on sustainable management

Period provided and fee dependon content of support

Mai n ta r ge ts

Department leaders and front-line site manage:HVXSSRUWVSHFLoFWDFWLFVDQGDFWLYLWLHVWRVROYHSUREOHPVLQDFFRUGDQFHZLWK
strategies and roadmaps drawn up in the Strategy Stage.
Support menu examples
CSV business producing and cooperation; support for formation of agreement with stakeholders; total work design; compliance, etc., education andtraining; partner evaluation and selection support; ongoing monitoring ofefforts and activities and plan revisions; outsourcing of business operations;
100% recycling, etc.

Environmental Strategy Design BusinessSpecial features of The Sustainable Stage
Special features

Special features1

3

Fusion of environmental and management strategies

Environmental strategy that mutually links products, production, marketing, sales, procurement, etc., strategies without separating it from management strategy can be planned via the Drama and Strategy stages.
Product strategy
Management Production strategy
strategy Marketing strategy
Procurement strategy
Other strategies

Environmental strategy
Not contradicting other strategies, but united with them.
&DQH[SHFWV\QHUJ\EHQHoWVSpecial features

2

Makes impact on enterprise value visible(QWHUSULVHYDOXHDVVHVVPHQWVWKDWUHpHFWERWKoQDQFLDODQGQRQoQDQFLDOLQIRUPDWLRQKDYHUHFHQWO\EHFRPHPDLQstream. In this service, we forecast the impact of the current business environment and future environmental conVWUDLQWVDQGFRUSRUDWHHIIRUWVLQWKHDUHDRIHQYLURQPHQWRQoQDQFLDODQGQRQoQDQFLDOLQGLFDWRUV*Forecast impact madevisible based on the six
capitals advocated by
the International Integrated Reporting Council(IIRC) and can be used as
basic information among
various types of corporate
information disclosures.

Improvement in capital

Implementation

P planning

D Implementation

C Monitoring

A Revision

Planning the vision
Sustainable strategy planning

Implementation support menu which has a solid track record

HumancapitalManufacturing
capitalFinancial
capitalIntellectual
capitalHumancapitalManufacturing
capitalThe support menu provided in the Solution and Operation stages is based on the environmental services AMITA
has provided to many companies for nearly 40 years. AMITA’s strength is its ability to implement measures andrespond in a comprehensive fashion from defensive environmental measures through to offensive CSR planning.

NaturalcapitalFinancial
capitalNaturalcapitalWide variety of implementation support examples▶Total waste recycling (recycling of previously incinerated waste, zero-emission support, etc.)▶Green procurement support (support for drawing up green procurement standards, provision of alternative raw materials,
HQYLURQPHQWDOFHUWLoFDWLRQDXGLWVDVVHVVPHQWVHWF
▶Support for revising product manufacturing and sales processes (support for reducing volume of waste produced, vending
machine recovery, etc.)▶Support for adoption of IT platforms in environmental management (provision of environmental management systems)▶Support for CSR and environmental marketing (environmental service market research, sales promotion support, etc.)▶CSR activity consulting (CSR activity planning and operations support, support for making corporate events more environmentally friendly, support for publicizing efforts, etc.)▶Environmental risk reduction consulting (risk assessments, compliance training, etc.)▶6XSSRUWIRUDFKLHYLQJHIoFLHQF\JDLQVLQHQYLURQPHQWDOEXVLQHVV PDNLQJEXVLQHVVYLVLEOHRSWLPL]LQJEXVLQHVVpRZPDQ
ual creation support, etc.)▶Environmental business outsourcing (waste management business representation, personnel dispatch, etc.)▶Employee education support (environmental knowledge testing, environmental education and training, provision of materials for correspondence courses, etc.)▶Biodiversity consulting (establishment of biotopes in factories, surveys of introduced species, etc.)▶(QYLURQPHQWDOFHUWLoFDWLRQDXGLWVDVVHVVPHQWV )6&®IRUHVWU\FHUWLoFDWLRQ$6&DTXDFXOWXUHFHUWLoFDWLRQDVVHVVPHQWVVXU
veys of proportion of used paper in recycled paper products, etc.)▶6XSSRUWIRUUHVSRQVHWRQHZHQHUJ\ VXSSRUWIRUVDOHDQGSXUFKDVHRIUHQHZDEOHHQHUJ\LVVXDQFHRIJUHHQHQHUJ\FHUWLoFDWHVHWF

Intellectual
capitalRelational
capitalRelational
capitalTimeline

Correlation with capital

Sales target
Sales in 2018
(third year of sales)¥4.5

bn/yearDrama stage and strategy stage¥100mnSolutions stage and operation stage ¥4.4bn*Solutions and operation stages include all services for corporations
provided in 2015 including recycling and outsourcing.
Net sales from these services totalled around ¥4.2bn in FY 2015.

21

Solution and operation programs for implementing environmental strategies
The Sustainable Stage offers numerous solution and operation programs for designing and implementing corporate environmental
strategies. This section outlines two major programs and our initiatives for FY 2016 and beyond.

Supportprogram

Waste management outsourcing ser vices
Best Way to Manage Waste
Ou t l i n e

Value propositions to our clients

This waste management outsourcing service provides each client with tailor made comprehensive operational support that ensures its decisions are properly implemented. Combining automated and personal service solutions, this includes negotiating terms and conditions with intermediate waste treatment companies
and collection and transportation companies, writing up contracts and generating manifest information.

Best Way to Manage Waste provides solutions to clients’ problems:

Main features L e v e r aging synergies w ith other s ur v ic es
Best Way to Manage Waste is a waste management infrastructure service that makes the most of$0,7$jVH[SHUWLVHZKLOHHQVXULQJWKHpH[LELOLW\QHHGHGLQPHHWLQJWKHFOLHQWjVLQGLYLGXDOQHHGVAs a result, in FY 2015, orders for service programs that stem from or couple with Best Way toManage Waste increased.
6HH3IRUDFWXDOoJXUHV 

1 Lack of environmental business personnel; cannot afford to spend time on training.
2 Compliance risks regarding improper or illegal waste disposal or management.
3 Different management procedures for each plant. Operations are handled by specific individuals.

Issues in delive ring ser vices
In order to minimize internal costs and risks, an increasing number of companies are choosing tooutsource certain business operations. To meet the increasing needs of all Best Way to Manage Waste
clients, AMITA must act swiftly to establish a system that ensures service quality will be maintained.

Client (Waste generetor) plant

Initiatives for FY 2016
Establishing a solid system for providing services

Waste management
needs

Realtime individual
consultation and services

Handles waste management
operations on behalf of client

Since its launch in 2014, the Best Way to Manage Waste service has met with high approval from clients. In
2015, we began developing customized products to provide betterBest Way to Manage Waste services.
In 2016, in preparation for a further increase in clients, we are working on a system that will make it possible
for us to maintain the current level of high quality services in waste management.

Details of
FY 2016
initiatives
Waste treatmentcompany A

22

Waste treatmentcompany B

Collection andtransportationcompany A

Collection andtransportationcompany B● Review risk management procedures and quality management systems to ensure that the
UHTXLUHPHQWVVSHFLoHGLQWKH6/$ VHUYLFHOHYHODJUHHPHQW ZHH[FKDQJHZLWKHDFKFOLHQW
are met● Standardize business operations and train operators● Develop new products in response to client needs

Environmental Strategy Design BusinessSupportprogramValues propositions
Provides solutions to client problems such as:

100% recycling service

1 Increase in the risk of resource procurement
2 Processing of hard-to-recycle waste[Initiatives for FY 2016]
Closely ascertain the resource procurement needs of companies and step up efforts to develop alternative (recycled) resources.
Goals

New users companies

8

New alternative (recycled) resources 8

E x p a n d u s e o f a lte rn a tiv e re so u rc e s among indus tries and bus ines s es
AMITA has a proven track record in developing and delivering newly improved alternative resources for the cement industry. In 2015, we applied our knowhow to developing new alternative
resources for the ferrous and nonferrous metal industries and succeeded in creating 3 products.
In 2016, we aim to expand the number of industries using alternative resources and develop moreproducts in a systematic and organized manner.

Eg. Steel manufacturers

Naturalresources A

Naturalresources B

Naturalresources C

Naturalresources D

Providealternative
resources!

Product (steel bar)

4

RollingSlab (crude steel)3

Continuous
casting

2

2XWSLOHUHoQLQJ
(ladle)Steel production(electric furnace)1

Develop resources recycled from waste-derived materials as aalternative for the natural resources A-D used in production.

Design a process flow within the area that covers everything from waste collection
to the production and delivery of alternative resources
Alternative resources are made from waste. In order to ascertain the needs of user clients anddevelop new alternative resources within a short time frame, a team responsible for cultivating
new users will work together with procurement staff who are able to obtain detailed information on waste, so as to design and promote optimum recycling of resources for that region.
8VHUVRI
alternative resources

8SXQWLO
The function ofwaste collection andcustomer reclamation were conducted separately. The
system divided thetwo functions and
SULRULWL]HGHIoFLHQ
cy in each.

From 2016
The function ofwaste collection andcustomer reclamation will be integrated in each area,
Japan being divided
into four areas.
Operations will beclosely coordinated.

Lack of aggregatedinformation!

Information onuser needs

Waste generetors

Waste
information

Dedicatedsales division

Dedicatedsales division
Development andproduction division

Waste generetors

Waste
information

Aggregate
information!

Sales and production
division
8VHUVRIDOWHUQDWLYH
resources

Aggregate information on raw
materials (waste) and the needsof companies using alternative
resources (recycled resources)!

Information onuser needs

23

Business
Topics 2015

Regional Systems
Design Business

Major progress on developing a model system for Comprehensive Cyclical
System of Resource Usage in Minamisanriku, Miyagi Prefecture.
Model for developing Minamisanriku

The AMITA Group's Regional Design Business supports
compact and independent
regional development thatmakes the most of neglected
regional resources. In 2015,
we were able to make major progress in developing
business model prototypes,
including Minamisanriku
BIO, our biogas facility in
Minamisanriku, Miyagi Prefecture that began full-scale
operations.

*Based on information provided by Minamisanriku

D
Forest(s)Appropriate development of forests
Maintenance of environment andlandscape, disaster mitigation

Accredited
FSC® certification

B
Waste separation
stations

A
Pellet stove boilers

Community
Hot spring facilities
Morisatoumi Restaurant
Industrial tourism

A

Return to symbiotic farming
Branding and increasing
competitivenessPellets

Biogasfacility

Emergency disasterprevention center

Converting waste into a
resource
Disaster-resistant community

FieldsWood pellet
facilityC

Boilers

Medicinal herbs
Symbiotic farming+ Firewood station

E
Sea
Boilers

Sustainable fisheries and aquaculture farms
MSC certification
ASC aquaculture certification

AMITA's biogas facility

Oct. Minamisanriku BIO begins

Restoring fisheries and theseafood processing industry
Increase competitivenessfull-scale operation.

*For details, please refer to thenext page.

B

C

6WDUWRI0LQDPLVDQULNX%,2

Oct. triggers separate collectionof food waste throughout
the Minamisanriku area.

24

D

fertilizer is sprayed
Apr. Liquid
on Minamisanriku farms on
a test basis.
*Full-scale spraying is scheduled to
FRPPHQFHLQ$SULO

E

Minamisanriku's forestry

Oct. FRRSHUDWLYHDFTXLUHG)6&®

IRUHVWFHUWLoFDWLRQ7KH
assessment was conductedby AMITA.

$0,7$FRQGXFWHGWKHoUVW$6&

Nov. VXVWDLQDEOHDTXDFXOWXUHFHUWLo
cation assessment in Japan.

*The farm is expected to receive certioFDWLRQLQ01&ROXPQ
Minamisanriku BIO in Miyagi Prefecture
c ommences operation !

6LQFH VSULQJ  WKH $0,7$ *URXS KDV EHHQ
working with the local government of Minamisanriku, Miyagi Prefecture to turn the town into asustainable society that recycles its resources andenergy. We are developing the Minamisanriku
Model, the prototype of a comprehensive comPXQLW\UHVRXUFHFLUFXODWLRQV\VWHP&HQWUDOWRWKH
system, which is scheduled for completion in 2018,is the biogas facility Minamisanriku BIO which
commenced commercial operation in October 2015.
Making full use of biogas technologies, food waste
collected from throughout the town is transformed
into electricity and liquid fertilizer, forming the basis of a cyclic society in which waste is recycled into
resources.

Minamisanriku BIO

Facility type: biogas facility/LTXLGIHUWLOL]HUSURGXFWLRQW\HDU
6LWHDUHDP2
Revenue: 70-80 million yen/year%XLOGLQJDUHDP2
Payback period: Estimated at 7 years
Processing capacity: 10.5t/day
2SHUDWLQJERG\$0,7$&25325$7,21(OHFWULFLW\JHQHUDWHGN:K\HDU

topic

02

Surveys and negotiations continue for developing a Comprehensive Cyclical System of Resource Usage in Palau and Vietnam

AMITA has been commissioned by the Ministry of
the Environment to work on the government projectfor FY 2015—Incubation and Overseas Promotion ofWaste Management and Recycling Industry. In orderto develop a comprehensive resource circulation
V\VWHPPRGHOIRUWKHLVODQGRI&DW%D+DLSKRQJFLW\
Vietnam and the Republic of Palau, we conductedfeasibility studies and consensus building negotiations. In November, we invited the Governor of Koror
6WDWHLQ3DODXDQGVHYHUDORWKHUGLJQLWDULHVWRYLVLWMinamisanriku BIO and meet with local government
OHDGHUV6LQFHWKH5HSXEOLFRI3DODXLVFRQVLGHULQJ
building a similar biogas plant, visiting Minamisanriku provided guests with concrete images of what
could be achieved as well as the challenges that needed to be overcome in order to realize their goals. We
were able to discuss these and other issues with them
DQGSURYLGHVSHFLoFFDVHH[DPSOHV

7KH*RYHUQRURI.RURU6WDWHDQGRWKHUGLJQLWDULHVYLVLWMinamisanriku BIO

5HJLRQDO6\VWHPV'HVLJQ%XVLQHVV

topic

Japan pledges a 26% reduction in CO2 emissions at COP21.
Renewable energy is key to achieving this goal.
$W&23 7KHVW&RQIHUHQFHRIWKH3DUWLHVWR
WKH8QLWHG1DWLRQV)UDPHZRUN&RQYHQWLRQRQ&OLPDWH&KDQJH KHOGLQ3DULVIURP1RYHPEHU
2015, Japan announced that it would aim for a
UHGXFWLRQLQJUHHQKRXVHJDVHPLVVLRQV FRPSDUHGZLWKOHYHOV E\6LQFHWKHPRVWGRPLQDQWJUHHQKRXVHJDVLV&22, Japan also set
DUHGXFWLRQWDUJHWIRU&22 household emissions. This would mean cutting back from the current 200 million tons of emissions to 122 million
tons; a reduction of roughly 78 million tons.
This calls not only for a reduction in garbage
GLVSRVDODQGWKHGHYHORSPHQWRI&22 reduction
technologies, but changes in both lifestyle and
PLQGVHW+DUQHVVLQJQHJOHFWHGUHVRXUFHVWRFUHDWH

topic

03

renewable energy is key to meeting this goal.
$0,7$SURSRVHVEXLOGLQJD&RPSUHKHQVLYH&\
FOLFDO6\VWHPRI5HVRXUFH8VDJHWKDWWUDQVIRUPVfood waste from the community into renewableenergy without the use of incineration. In addiWLRQWRWKHRIIVHWRI&22 emissions that would
have been released if food waste and sludge were
disposed of, the system in Minamisanriku transIRUPVZDVWHLQWRHOHFWULFLW\UHVXOWLQJLQWRWDO&22
HPLVVLRQVDYLQJVRIWRQVD\HDU
While this is only a tiny percentage of the reduction target, if other municipalities were to adopt asimilar system, this would go a long way towards
enhancing the sustainability of not just one particular region but the entire world.

Growth of local resource cycling businesses
based on the Minamisanriku Model

6HPLQDUVWDUJHWHGDWUHSUHVHQWDWLYHVIURPORFDOJRY
HUQPHQWVZHUHKHOGLQ6HQGDLDQG2VDND,QDGGL
tion to introducing the initiatives in Minamisanriku
and other areas, we also provided advice on how to
go about implementing similar systems in their municipalities.The seminars attracted 30 participantsfrom 18 municipalities, all of whom showed avid
interest in the initiatives. Their questions provided
us with an insight on the hopes pinned on sustainability from communities faced with a declining
population and aging public infrastructure. In addition to the municipalities represented by the seminar participants, a number of other municipalities
have asked us to present proposals for public-private partnership projects for harnessing neglectedresources.

6HPLQDUVRUJDQL]HGIRUUHSUHVHQWDWLYHVIURPQXPHURXV
municipalities,Q)HEUXDU\$0,7$UHFHLYHGDFRPPLVVLRQIURPWKHWRZQ
of Kamimachi in Miyagi Prefecture to develop a plan for their%LRPDVV,QGXVWULDO&LW\,QLWLDWLYH

25

Business Development Plan—Achieving profitablility in the Regional Design Business:KLOHSURPRWLQJWKHGHYHORSPHQWRID&RPSUHKHQVLYH&\FOLFDO6\VWHPRI5HVRXUFH8VDJHLQ0LQDPLVDQULNXZLWK0LQDPLVDQULNX%,2DWLWVFHQWHUZH
DUHDOVRRUJDQL]LQJVLWHYLVLWVDQGEULHoQJVWRDWWUDFWLQWHUHVWIURPRWKHUUHJLRQVERWKLQDQGRXWVLGH-DSDQ7KLVZLOOOHDGWRDQDQQXDOLQFUHDVHLQUHJLRQDOFOLHQWVHQDEOLQJXVWRWXUQUHJLRQDOGHVLJQLQWRDSURoWDEOHEXVLQHVVPayback model for biogas plants and other core infrastructure initiatives
After forming a partnership with municipal clients, AMITA develops a local circulation system toharness neglected resources. Mid and long term operations of the core infrastructure is contracted out
WR$0,7$ZKLFKLVKRZZHDFKLHYHSURoWV)HDVLELOLW\VWXGLHVDQGYLVLRQGHYHORSPHQWXVXDOO\WDNH
about three years and are conducted with subsidies from national or local governments. Payback fromGHYHORSLQJFRUHLQIUDVWUXFWXUHVFDQEHH[SHFWHGLQRU\HDUVIURPWKHVWDUWRIWKHSURMHFW＋Conceptual model forachieving profitability▶Studies and pilot testing
Vision development(Utilize subsidies)

0 year 3 years 0 year

Fiscal Year 2015



Minamisanriku

17

18



20

21

22

23

Payback period

25$IWHU

Profitable period

Changes in accumulated earnings
Core infrastructure initiative 2Core infrastructure initiative 1
5 years
7 years

Forging relationships
Project development−

6LQFH UHJLRQDO GHVLJQ ZLOO IRUP D PDMRU SLOODU RI JURXS HDUQLQJV
$0,7$DLPVWRFRQGXFWWZRUHJLRQDOIHDVLELOLW\VWXGLHVD\HDUVWDUWLQJLQ

15 years▶ Business investment 1

Region A

Feasibility study period

Payback period

Profitable period

Region B

Feasibility study period

Payback period

Profitable period

5HJLRQ&Feasibility study period

Payback period

Profitable period

Region D

Feasibility study period

Payback period

Profitable period▶ Business investment 2*Since the Minamisanriku Model is a pilot project that is meant to serve as the prototype for product development, thepayback period is estimated to be 7 years, which is slightly longer than usual.

Initiatives to enhance profitability
In order to develop, propose and deliver a new and sustainable social system, regional design initiatives will be undertaken in three phases as shown on the right.
%DVHGRQRXUWUDFNUHFRUGLQ0LQDPLVDQULNXZHDLPWRLQFUHDVHSURoWDELOLW\E\FRQVLGHULQJDVKLIW
towards high earnings business such as recycling waste other than food waste.

26

Phase 1

Phase 2Phase 3

Building core infrastructures business'HYHORSLQJDQGRSHUDWLRQmanagement of biogas plants andRWKHUIDFLOLWLHV'HYHORSLQJD&RPSUHKHQVLYH
&\FOLFDO6\VWHPRI5HVRXUFH8VDJH
7XUQLQJZDVWHRWKHUWKDQIRRG
ZDVWHLQWRUHVRXUFHV&UHDWLQJORFDOLQGXVWULHVorchestrating local development
1DWXUDOLQGXVWULHVVXFKDV
cultivating medicinal herbs and
V\PELRWLFIDUPLQJSocial needs: Aging of existing social infrastructure
RIZDVWHLQFLQHUDWRUV RI DQGRIQLJKWVRLOWUHDWPHQWSODQWV RI DUHSDVWtheir 20 year service life. As the population declines and ages, the rebuilding and renovation of suchsocial infrastructures will pose a serious problem to an increasing number of municipalities.
Our regional design business aims to support such municipalities in the creation of sustainable and
DWWUDFWLYHFRPPXQLWLHVE\SURSRVLQJ&RPSUHKHQVLYH&\FOLFDO6\VWHPRI5HVRXUFH8VDJHFHQWHULQJaround biogas facilities that can turn food waste, night soil and other waste products into resources
while minimizing initial costs.

Example of value propositions: Biogas plants that contribute to
the development of a sustainable society)RRGZDVWHLQFLQHUDWLRQOHDYHVDURXQGLQUHVLGXHVZKLFKKDVWREHGLVSRVHGRILQODQGoOOV,Q
VRPHPXQLFLSDOLWLHVWKHFRVWRISURFHVVLQJWKHLQFLQHUDWLRQUHVLGXHFDQEHDVKLJKDV\HQSHU
ton. Biogas plants can convert all byproducts into resources that can be reused by society. In addition, such plants can be expected to create jobs and add value to local agricultural products, thereby
contributing to the creation of a local resource cycling society.

Age distribution of municipal waste incinerators and night soil treatment plants
Waste incinerators and night soil treatment plants generally need to be rebuilt or renovated after 20 years.
An increasing number of such facilities in Japan fall under this category. The declining population, however,calls for the development of new social infrastructures.
(Number of facilities)
300
250

278
227

200

100
50
0

52 45

89 82

1XPEHURILQFLQHUDWRUVRYHU\HDUVROG
RIWKHWRWDOQXPEHURIIDFLOLWLHV 

215
166

150

■ Incinerators

165

117

138142

91

5-

10-

15-

20-

25-

30-

35-

40-

Source: Ministry of the Environment Data on the State of Generation andTreatment of Municipal Waste

Incinerator

Number of plants over 20 years old/558 of
WKHWRWDOQXPEHURIIDFLOLWLHV 

66

46 52

*Numbers as of the end of 2012

Liquidfertilizer

Biogas facility(Yen/t)Incineration
residue

Ref: Maintenance costs of landfills (Top 10 municipalities in terms of processing 1 ton of incineration residue)¥45,000(Age)

Fields

6KRSV■ Night soil treatment plants

133

6

0-

◎

+RPHV

¥40,000¥35,000¥30,000¥25,000¥20,000/DQGoOOV
*Waste incineration results inLQUHVLGXHVZKLFKKDYH
WREHGLVSRVHGRILQODQGoOOV&DOFXODWLRQV EDVHG RQ WKHnational average ascertained
from the FY 2013 survey
RQ WKH 6WDWH RI *HQHUDWLRQ
and Treatment of Municipal:DVWH¥15,000¥10,000¥ 5,000
0

Mie
Kanagawa Tokushima
Prefecture Prefecture Prefecture

Yamanashi
Prefecture

OkayamaPrefecture

Chiba
Prefecture

Nara
Prefecture

KagawaPrefecture

Kochi
Prefecture

SaitamaPrefecture%DVHGRQGDWDDVRIWKHHQGRI)<UHJDUGLQJWKH6WDWHRI*HQHUDWLRQ
and Treatment of Municipal Waste, Ministry of the Environment.

27

Progress
in 2015

Progress in FY 2015

Minamisanriku BIO completed in October 2015
Accelerated roll-out to other regions aimed at making regional design more profitable
In 2012, the AMITA Group set up a pilot biogas facility for the purpose of future commercialization that could turn household waste
into electricity and unutilized timber offcuts into wood pellets. After four years of feasibility studies and testing, the bio gas plant
Minamisanriku BIO began full-scale operation in October 2015, providing us with a source of long-term and stable earnings.

3 c o r e p r o j e ct s

P ro gre s s in 2015

Promoting theMinamisanriku
Model

v%LRJDVIDFLOLW\0LQDPLVDQULNX%,2VWDUWVIXOO
scale operation.
v3URPRWLQJWKHXVHRIOLTXLGIHUWLOL]HUVv(QFRXUDJLQJUHVLGHQWVWRVHSDUDWHIRRGZDVWH
v&RQGXFWHG)6&®)RUHVWFHUWLoFDWLRQDQG$6&DTXDFXOWXUHFHUWLoFDWLRQDVVHVVPHQWVLQ0LQDPLVDQULNX
)6&®FHUWLoFDWLRQDZDUGHGLQ2FWREHU
$6&FHUWLoFDWLRQH[SHFWHGVRPHWLPHLQv)HDVLELOLW\VWXGLHVDQGSURPRWLRQRIZRRGSHOOHW
business.

Introducing&RPSUHKHQVLYH
&\FOLFDO6\VWHPRIResource Usage inother parts of Japan

Overseas roll out
RI&RPSUHKHQVLYH
&\FOLFDO6\VWHPRIResource Usage

28

v6HPLQDUVRQHQKDQFLQJWKHVXVWDLQDELOLW\RIORFDOFRPPXQLWLHVZHUHKHOGLQ6HQGDLDQG2VDND
Around 30 representatives from 18 municipalities
took part.
vInvited many observers and visitors to Minamisanriku BIO and other locations in the area.
v2 feasible studies conducted with the aim of introGXFLQJ&RPSUHKHQVLYH&\FOLFDO6\VWHPRI5HVRXUFHUsage to the Keihoku district of Kyoto and Kaga
&LW\v&RQGXFWHGIHDVLEOHVWXGLHVLQWKH5HSXEOLFRI
3DODXDQG&DW%D,VODQGLQ9LHWQDPLQSUHSDUDtion for implementation.
v,QYLWHGWKH*RYHUQRURI.RURU6WDWHLQ3DODXWR
visit Minamisanriku and meet with municipal
DXWKRULWLHVWRREVHUYHoUVWKDQGWKH0LQDPLsanriku BIO so as to get a concrete image of theresource circulation system.

Evaluation

6SUHDGLQJOLTXLGIHUWLOL]HU◎&KDOOHQJHVIDFLQJEXVLQHVVSURPRWLRQ

1
2
3
4

1
2
○

6HFXULQJ XVHUV RI OLTXLG IHUWLOL]HU SURGXFHG DW
Minamisanriku BIO.
Effectively ascertaining and approaching municipalities
interested in developing sustainable communities.
'HOD\LQUHDFKLQJDPXWXDODJUHHPHQWZLWK&DW%D,VODQG
9LHWQDPGXHWRSHUVRQQHOUHVKXIpHVLQWKHORFDOJRYHUQPHQW

Tactics to mitigate problems○
Visitors to Minamisanriku BIO

Improving segregation of food waste collected at
Minamisanriku BIO.

3
4

&ROODERUDWHZLWKWKH0LQDPLVDQULNXWRZQRIoFHWRSURvide an incentive to separate food waste by promoting
and informing residents on the importance of segregating food waste, separation methods and effects.
&ROODERUDWHZLWKWKH0LQDPLVDQULNXWRZQRIoFH-$
Minamisanriku, the Miyagi Prefectural Agriculture and+RUWLFXOWXUH5HVHDUFK&HQWHUDQGRWKHURUJDQL]DWLRQVWR
start all-out promotion to farmers.
Further efforts to generate information and promotedialog via the internet and opportunities to address
people outside the loop.
Enhance information-gathering capacity by furtheringongoing communication with competent personnel inthe community.

0DMRU,QLWLDWLYHVIRU)<

Improve profitability of biogas plant operations and promote theMinamisanriku Model to other regions

5HJLRQDO6\VWHPV'HVLJQ%XVLQHVV

Actions
LQ

,Q)<ZHDLPWRDFKLHYHVWDEOHRSHUDWLRQRI0LQDPLVDQULNX%,2DQGVWXG\IXUWKHUZD\VWRHIIHFWLYHO\UHF\FOHQHJOHFWHGUHVRXUFHVVXFKDVIRRGZDVWH
and night soil. We also intend to make full use of our expertise from setting up various pilot programs in Minamisanriku, including full-scale operations
RI0LQDPLVDQULNX%,2DQGWKHUHVXOWLQJQHWZRUNWRLPSURYHSURoWDELOLW\E\RSHUDWLQJWKHELRJDVIDFLOLW\ZLWKWKHRSWLPXPQXPEHURISHUVRQQHOWRHQKDQFHHIoFLHQF\DQGLQFUHDVHSURFHVVLQJFDSDFLW\
We will also put together a package on Minamisanriku to expand business in regions plagued by similar concerns both in and outside Japan.

&RUH
projects,Q LW LDW LY HVI RU

Promote theMinamisanriku
Model

v$FKLHYHVWDEOHRSHUDWLRQRI0LQDPLVDQULNX%,2DQGGHYHORSSHULSKHUDO
technologies.*,QFOXGHVLPSURYLQJZDVWHVHJUHJDWLRQDQGXVHRIOLTXLGIHUWLOL]HUV
v3URYLGHVXSSRUWWRFRPPXQLW\HIIRUWVWRVHWXSDZRRGSHOOHWEXVLQHVVv2QJRLQJGHYHORSPHQWRI&RPSUHKHQVLYH&\FOLFDO6\VWHPRI5HVRXUFHUsage that rely on technologies other than biogas.
,QFOXGHVWULDOWHVWLQJRIDUHVRXUFHUHF\FOLQJVWDWLRQWKDWFRQYHUWVQHJOHFWHG
PDULQHSURGXFWVLQWRIHUWLOL]HUUDZFHPHQWPDWHULDOVDQGRWKHUSURGXFWV 

A MITA's advantage in regional design
A wealth of knowhow and expertise throughout each stage,
from feasibility studies to commercial operation
6LQFHIRXQGLQJWKH$0,7$,QVWLWXWHIRU6XVWDLQDEOH(FRQRPLHV&R/WGLQZHKDYHVXSSRUWHGWKH
GHYHORSPHQWRIORFDOEXVLQHVVHVWKDWXWLOL]HQHJOHFWHGUHVRXUFHVIURPWKHIRUHVWVoHOGVDQGVHDLQRYHU
areas throughout Japan. In doing so, we have succeeded in developing a wide range of social and recycling
technologies. We are able to apply our vast experience in providing total support and collaboration throughout every stage of business development tailor made to the area, from feasibility studies, pilot testing, vision
design, and business planning to the construction and operation of facilities.

Contents of Comprehensive Cyclical System of Resource Usage package and business flow
Domesticroll out of&RPSUHKHQVLYH
&\FOLFDO6\VWHP
of Resource
Usage

Roll out&RPSUHKHQVLYH
&\FOLFDO6\VWHP
of Resource
Usage to otherregions
RYHUVHDV

v,PSOHPHQWVXSSRUWPHDVXUHVIRUWKH%LRPDVV,QGXVWULDO&LW\,QLWLDWLYHLQ
Kamicho, Miyagi Pefecture.
v&RPPLVVLRQHGWRFDUU\RXWIHDVLELOLW\VWXGLHVDQGYLVLRQGHVLJQIRU
comprehensive resource circulation systems in two municipalities.
v5HSRUWRQWKH0LQDPLVDQULNX0RGHO,QFOXGHVRJDQL]LQJUHODWHGV\PSRVLXPVDQGORFDOREVHUYDWLRQWRXUVDQG
SURPRWLQJPHGLDUHODWLRQV
v6HWXSZHEVLWHLQWURGXFLQJEXVLQHVVDFWLYLWLHV

v2QJRLQJUHVHDUFKDQGVWXGLHVLQ3DODXDQGRWKHUUHJLRQV
$LPIRUUHDFKLQJDPXWXDODJUHHPHQWZLWK$0,7$jVFRXQWHUSDUWLQ3DODXWKH.RURU6WDWHJRYHUQPHQWUHJDUGLQJSURMHFWVFKHPHVSODQVDQG
LPSOHPHQWDWLRQHWF
v$FWLYHO\HQJDJHZLWKRYHUVHDVPHGLDHPEDVVLHVDQGRWKHURUJDQV*We eventually hope to single out areas that put out collection buckets containing a large volume of waste other thanfood waste and provide detailed instructions on segregation so that in the future, the percentage of foreign matter
will be as close to zero as possible.

Business flow
Investment scheme

1. Examine
potential local
resources

2. Trial tests and 3. Design andadjustfeasibility
business plan
studies

4. Business investment 5. Operation andand development ofoperational
infrastructure
supportStart with public funding and gradually increase business investments.

Advantages and features of each flow stage

1, 2

Boasting an excellent track record in developing natural industry technologies,
including the cultivation of medicinal herbs and symbiotic farming, and vast
H[SHUWLVHDVDFHUWLI\LQJERG\LQHQYLURQPHQWDOFHUWLoFDWLRQ$0,7$FDQZRUNRQ
2015 年
every stage in the development of systems2014
that年utilize neglected resources.

2, 3

ココ！
In addition to developing businesses
for corporate clients, we have vast experiencein collaborating with partner companies, enabling us to propose public-private
partnerships requiring community and corporate participation. As proven by our
DFFRPSOLVKPHQWVLQ0LQDPLVDQULNXZHDUHDEOHWRGHOLYHU&RPSUHKHQVLYH&\FOLFDO
6\VWHPRI5HVRXUFH8VDJHEDVHGRQORFDOQHHGVDQGDWWULEXWHV

2, 3


Drawing on over 30 years experience in operating recycling plants, we are able toformulate business plans and design and operate facilities that take into account
SURoWDELOLW\VRFLDOFRQWULEXWLRQHIoFLHQF\DQGVDIHW\

いま29Financial Report for FY 2015

Recent performance and financial statements
These are the AMITA Group's financial results for FY 2015 (Jan. 1, 2015 – Dec. 31, 2015)

Recent businessresults
These are the AMITA Group's consolidated sales, operating income andnet income for the past six years.

Consolidates sales (in millions of yen)
4,735

251

4,987
4,412

4,676

4,360

4,557

135
84

●

Financialstatements
Comparison of Consolidated Balance
Sheets, Consolidate Statement of
Income and Consolidate Cash Flow
Statements for FY 2015 and FY 2014.

2011

2012

2014

2015

Consolidated Balance Sheets （in thousands of yen）
Account（Assets）
Current assets

2010

●

2011

2012

Current period Previous period
Dec. 31, 2015 Dec. 31, 2014

Account
Net sales

1,664,661
2,072,570

Cost of sales

7DQJLEOHo[HGDVVHWVproperty, plant and equipment

2,219,948

1,836,599

Selling, general andadministrative expenses,QWDQJLEOHo[HGDVVHWV

57,816
187,057
4,141,247

67,814
168,155
3,737,231

Operating income oroperating loss

1,783,043
1,755,050
3,538,094

1,599,993
1,434,194
3,034,187

Ordinary losses

604,095
474,920244,683△115,324△183

703,157
474,920244,683△16,262
△183

△941

△113

603,153703,043

4,141,247

3,737,231

Fixed assets

Total assets（Liabilities）
Current liabilities
Fixed liabilities
Total liabilities（Net assets）
EquityCommon stock
Capital surplus
Retained earnings
Treasury stock
Other comprehensive
incomeTotal equity
Total liabilities andequity

2013

△ 84

8

△ 553

2014

2015

2010

Consolidated Statement of Income（in thousands of yen）

1,676,424
2,464,822

Investments and other assets

30

2013

115

80

△ 350

2010

Consolidated net income（in millions of yen）

Consolidated operating income (in millions of yen)

*URVVSURoW

Non-operating income
Non-operating expenses
Extraordinary income
Extraordinary losses

Current period Previous period
Jan. 1, 2015Jan. 1, 2014Dec. 31, 2015 Dec. 31, 2014
4,557,791 4,360,599
3,171,637 3,030,345
1,386,153 1,330,254
1,377,258 1,414,891
8,894△84,636

19,036
8,384
38,14525,449△10,214 △101,702
34,453
110,605
44,602
17,122

Net income before income taxes
and minority interests（losses）△20,363△8,219

Income taxes - current

39,24339,456△99,062

33,854△44,419
2,345

Income taxes - deferred
Net income or net losses

●

18

2011

2012

2013

2

△ 99

2014

2015

&RQVROLGDWHGVWDWHPHQWRIFDVKpRZV（in thousands of yen）
Account

Net cash provided by (usedin) operating activities

Current period Previous period
Jan. 1, 2015Jan. 1, 2014Dec. 31, 2015 Dec. 31, 2014
49,04978,197

Net cash provided by (used△360,600in) investing activities△75,017

Net cash provided by (usedLQ oQDQFLQJDFWLYLWLHV

281,345△317,396

Effect of exchange rate changes
on cash and cash equivalents

5,959

△959

Net increase/decrease in
cash and cash equivalents△24,245△315,176

Cash and cash equivalents
at beginning of period

737,775

1,052,952

Increase in cash andcash equivalents fromnewly consolidated
subsidiaries

1,327

Cash and cash equivalents at end of period

714,857

737,775

Business results and financial report

Ordinary income/net income/profit sharing

In August, the AMITA Group made significant downward revisions to originally forecasted
consolidated results for FY 2015. Thanks to effective manufacturing cost reduction strategies, healthy
LQYHQWRU\pRZVIURPDQXPEHURIPDQXIDFWXULQJSODQWVDQGRWKHUIDFWRUVFRQVROLGDWHGUHVXOWVDWWKH
end of FY 2015 exceeded August expectations, with net sales of 4,557,791 thousand yen and net losses of
99,062 thousand yen.

Foreign exchange losses from Taiwan related investments resulted in ordinary losses of 10,214 thousandyen (+91,488 thousand yen year-on-year). Reductions in compensation received from TEPCO in relation
to damages from the Fukushima Daiichi nuclear plant accident; the recording of Gamagori Recycle SC's
impairment loss; and a reversal of deferred tax assests resulting from a decline in losses carried overfrom the previous term, resulted in net losses of 99,062 thousand yen (loss of 101,408 thousand yen yearon-year).

Items on the income statement

Balance sheet items

Net sales

AssetsSales of valuable materials from recycling operation services, the increased processing capacity of the
AMITA Kitakyushu Resource Recycling Plant, and the increase in environmental consultancy contracts
and other factors resulted in net sales of 4,557,791 thousand yen (up 4.5%/+197,191 thousand yen year-onyear).

Increases in notes and accounts receivable, development of Minamisanriku BIO facilities, and construction of the AMITA Taiwan Resource Recycling Plant etc., led to a 404,016 thousand yen increase fromthe previous consolidated accounting period, resulting in 4,141,247 thousand yen.

Cost of sales, selling, general and administrative expenses
Increase in cost of sales resulted in a 141,292 thousand yen increase in net sales from the previous period.
Selling, general and administrative expenses were 1,377,258 thousand yen, an approximately 3% reduction
from 1,414,891 thousand yen recorded in the previous consolidated accounting period. We will continue tomake ongoing efforts to reduce selling, general and administrative expenses.

Liabilities and net assets
Increases in: notes and accounts payable; the portion of long-term debts due within the year: and accounts payable on construction of the Minamisanriku BIO facility led to an increase of 503,906 thousand
yen in liabilities from the previous consolidated accounting period, resulting in liabilities of 3,538,094
thousand yen.
Net assets amounted to 603,153 thousand yen, 99,889 thousand yen less than the previous consolidated
accounting period as a result of accounting net losses.

Cash flow status
Consolidated operating income variation analysis(year-on-year)
FY 2014 results

FY 2015 results(in millions of yen)

200

-100

69.58

70
60

Sales

100
0

Changes in the ratio of cost of sales ratio and selling,（%） general and administrative expenses
80

Cost of sales

197

141

Selling, generaland administrative＋8
expenses
37

84

50

Net cash provided by (used in) operating activities

40
30.21

30

-200
Gross profit

55*

Operating income

2SHUDWLQJLQFRPHDQGJURVVSURoWUHVXOWVKDYHEHHQURXQGHGGRZQ

Increases in accounts payable and receipt of compensation for damages etc., resulted in a 49,049 thousand yen increase in net cash from operating activities.

20

Net cash provided by (used in) investment activities

10

Investment activities and spending on the acquisition of tangible fixed assets and investment
securities resulted in a decline of 360,600 thousand yen in assets.

093*

Despite increases in accounts receivables, receipt of compensation for damages resulted in an increase in
QHWFDVKIURPRSHUDWLQJDFWLYLWLHV+RZHYHUVSHQGLQJRQWKHDFTXLVLWLRQRIWDQJLEOHo[HGDVVHWVUHVXOWHG
in a decline in net cash from investment activities. Together, this led to a 22,918 thousand yen decline in
FDVKpRZIURPWKHSUHYLRXVFRQVROLGDWHGDFFRXQWLQJSHULRGUHVXOWLQJLQFDVKpRZVRIWKRXVDQG
yen.

2010

2011

2012

Ratio of cost of sales

2013

2014

2015

Ratio of selling, general andadministrative expenses

Net cash provided by (used in) finance activities
Despite expenditures due to repayment of long-term debt, proceeds from long-term debt led to a 281,345
WKRXVDQG\HQLQFUHDVHLQDVVHWVIURPoQDQFHDFWLYLWLHV

31

Financial Report for FY 2015

Summary and status of accounts

Future Plans

Plans for FY 2016
Net sales(in millions of yen)

Operating income Ordinary income

Three-year plan (2016-2018)(in millions of yen)

Plan for period ending Plan for period ending Plan for period endingin December 2017
in December 2018
in December 2016

Net income

Plans for 2016

4,868

70

41

19

Net sales

4,868

5,078

5,318

2015 businessresults

4,557

8

△ 10

△ 99

Operatingincome

70

144

231

Ordinary
income

41

137

248

Major initiatives for FY 2016
FY 2016 is the focal year of our business restructuring. We will work on enhancing functional structure, corporate value and values propositions by focusing on the following initiatives.

1. Strengthening organizational foundation:HZLOOFDUU\RXWDPDQDJHPHQWUHVKXIpHDWWZR$0,7$+2/',1*6VXEVLGLDULHVZLWKWKHDLP
of introducing a more comprehensive approach to sales operations and strengthen developmentof innovative new business. We believe in the importance of nurturing next-generation andyounger managers to further corporate growth.
*Please refer to pages 44 and 45 for details on governance.

2. Regrouping of services offering environmental strategies
2016 sees the start of our The Sustainable Stage program , a new service that supports client companies from environmental strategy planning through operation. With regards to supporting
100% recycling, we will continue to strive for the production and delivery of valuable resources
without having to deal with cost competition by cultivating new users of resource circulation systems and developing methods to procure necessary raw materials.
*Please refer to pages 19-23 for details on The Sustainable Stage.

3. Further development of overseas business activities
Our key focus will be to ensure the start and stable operations of the AMITA Taiwan Resource Recycling Plant. We will also make steady inroads into setting up the Malaysia Resource Recycling
Plant (provisional naming).
*Please refer to pages 14 and 15 for details on overseas business development.

4. Establishing and developing the Regional Design Business/DVW\HDUZHVXFFHHGHGLQRSHQLQJWKHELRJDVIDFLOLW\0LQDPLVDQULNX%,27KLV\HDUZHDLPWR
stabilize its operations as well as apply our knowledge and experience from this project towards
offering small-scale biogas facility recycling packages as part of our efforts towards rolling out
Comprehensive Cyclical System of Resource Usage both in and outside of Japan.
*For details on Minamisanriku BIO, please refer to page 25. More on resource circulation systems on page 24.

32

Three-year Plan
Forecasts for our new three-year plan starting in 2016 see net sales of 4,868 million yen (2016),
5,078 million yen (2017) and 5,318 million yen (2018) and a net income of 19 million yen,（2016）
55 million yen（2017）and 143 million yen.
（2018）
With regards to our existing core initiative of providing 100% recycling services, since domestic waste emissions have hit a ceiling, we cannot expect major growth in this market. However,the start of our new The Sustainable Stage service for corporate clients; the development ofoverseas business activities such as the opening of the AMITA Taiwan Resource Recycling
Plant in March 2016; the development of new products for the non-ferrous and ferrous industries; stable operations of Minamisanriku BIO and the rollout of Regional Design businesses toother communities based on the knowhow gained from this project, will enable us to achieve
VWHDG\JURZWKLQVDOHV:HDUHFRQoGHQWWKDWWKH7DLZDQSODQWZLOOSOD\DPDMRUUROHLQERRVWLQJSURoWDELOLW\DQGH[SHFWHDUQLQJVRIPLOOLRQ\HQ  PLOOLRQ\HQ（2017）
and 549
million yen
:LWKUHJDUGVWRGRPHVWLFUHF\FOLQJVHUYLFHVZHZLOOHQVXUHSURoWDELOLW\E\（2018）
implementing various cost reduction measures, including reducing production costs.

Future plans

Dividends:KLOHVWULYLQJWRDFKLHYHoQDQFLDOVRXQGQHVVVWUHQJWKHQRXUPDQDJHPHQWEDVHDQGUHWDLQQHFessary internal reserves for future development, we also recognize the importance of continually
UHWXUQLQJDSSURSULDWHSURoWVWRRXUVKDUHKROGHUV2XUEDVLFSROLF\IRUGLYLGHQGVLVWKHUHIRUHWRGLVWULEXWHDURXQGRIFRQVROLGDWHGQHWLQFRPHDWWKHHQGRIWKHoVFDO\HDU8QIRUWXQDWHO\
due to sluggish earnings, we have not been able to pay dividends for the past several years.
6LQFHEXVLQHVVUHFRYHU\DQGoQDQFLDOVRXQGQHVVLVRXUPDLQSULRULW\ZHUHJUHWKDYLQJWRPDNH
WKHGLIoFXOWGHFLVLRQWRVXVSHQGGLYLGHQGVLQ)<DVZHOORecent dividends and forecast for FY 2016

(in yen)

FY 2010

FY 2011

FY 2012FY 2013

FY 2014

FY 2015

FY 2016(forecast)

0

0

0

10.00

0

0

0

AMITA Group's sustainable growth
In order to achieve our goal of realizing a sustainable society, the AMITA Group itself must beable to achieve sustainable growth.
The AMITA Group is proud of its talented and committed employees and cutting edge technolRJLHVDQGDSSUHFLDWHVWKHVXSSRUWRILWVVKDUHKROGHUVFOLHQWVDQGDIoOLDWHGSDUWLHV:KDWjVPRUH
we are blessed with clients who appreciate our services and goals and are willing to commit toour business activities. We believe that nurturing our relationship with each and every one ofthese stakeholders is key to achieving sustainable growth.
The overseas expansion of domestic companies, the shrinking domestic recycling market, andthe declining population are all factors in sluggish domestic consumption.
The AMITA Group is aiming to strengthen its partnership with corporate clients and deliver
added value to its existing recycling services. By providing corporate clients with environmental strategy support services that include the designing and implementation of environmental
strategies, we hope to support the environmentally sound and sustainable growth of our corporate clients. We believe this will lead to the development of new and potential markets, which
in turn will enable us to achieve sustainable growth in earnings.
We believe there is a strong demand in overseas markets, including Southeast Asia, for the
AMITA Group's diverse recycling technologies and consulting skills. This year's opening of the
7DLZDQSODQWPDUNVRXUoUVWPDMRUVWHSLQWRGHYHORSLQJDQRYHUVHDVSUHVHQFH:HDLPWRPDNH
the most of this experience in making steady inroads into diversifying and expanding ouractivities overseas.
In order to realize these projects and achieve sustainable growth while deliveringsocial values, we need to consider optimum funding measures commensurate toinvestment risks and returns over time and be flexible in implementing such measures.
We must be especially careful of financial stability, and balance investment and
EXVLQHVV SODQV WR HQKDQFH SURILW PDQDJHPHQW /RRNLQJ DKHDG RQFH ZH HVWDEOLVK D
stable business base, we aim to increase our net worth and reduce interest-bearing
debt so that we can achieve a capital-to-asset ratio of over 40% and manage withoutbank borrowing.
The AMITA Group vows to live up to stakeholder expectations and trust and continue its pursuit
towards realizing a sustainable society. Your commitment and support in achieving this mutual goalis the driving force of AMITA Group's sustainablegrowth.

Taro Shimizu, Director (CFO)33

Risk Management

Risk management
Enhancing corporate sustainability
Risk structure

Risk overview
Indentifying potential risks and developing appropriate measures is key to minimizing andreducing damages in emergency situations.
The AMITA Group prioritizes possible risks based on the potential impact on company trust,business target and stakeholder relationships etc., and risk probability. It also develops preventive and mitigation measures for each risk.
*Please refer to page 36 for main risks and mitigation measures.

Economic climate
Fluctuations in the 7KHEXVLQHVVFRQoGHQFH
prices of crude oil, met- of clients, partners andals and other resources
user companies

Financial risks[AMITA's business and risks]

Impact on business activities/earnings

The AMITA Group's diverse operations range from supporting our corporate client's sustainable strategies to developing comprehensive resource circulation systems for local communities. From the perspective of risk potential, the risks likely to have a serious impact on ourbusiness activities fall into two major categories: the handling of terrestrial resources (waste
and recycling resources) and the handling of client information.

Accidents/natural disaster risks
Operation of AMITA-owned
and partner-owned
production plants

Pollution/trouble
with residents
Facility defects

Mediating between
recycling partners

AMITA
CORPORATIONThe AMITAGroup/HJDOULVNVConsulting, information
services, cloud services,FHUWLoFDWLRQVHUYLFHVInformation
leakage risks

Development andpromotion of new
projects

Project delays,
exceeding of thebudget*Especially Waste
Management and Public
Cleaning Act

AMITA Institutefor Sustainable(FRQRPLHV&R/WG

R&D/pilot tests

The hazard of not being
able to determine the risks
involved in developing
new businesses
Stakeholder
relations*Describes major risks only34

Causes and measures taken to deal with the delay in the AMITA
Taiwan Resource Recycling Plant projectBecause of the delay in starting up the AMITA Taiwan Resource Recycling Plant, the Group failed tomeet its overall plans for FY 2015. We would like to take this opportunity to explain the circumstances behind the delay and the remedial measures we have developed for future project management.

Circumstances of delay in starting up the AMITA Taiwan Resource Recycling Plant

Measures to streamline implementation of future major projects
Management planning team set up in 2016 (former 2015 management planning preparatory office).
The management planning team will regularly monitor due dates, budgets and quality of major group projects managed by project managers and directors. Viewing the
project from various perspectives will enable prompt response to unforeseen circumstances and allow projects to be managed in line with corporate strategies.

● July 2012: Memorandum of Understanding signed with Tainan City
▶Revision of plant site undertaken because of concern that it would take time to receive
district entry and construction permits.

● Aug. 2014: Announcement of plans to construct a recycling plant in Changhua County● Feb. 2015: Announcement of change in start of operations▶Due to a delay in administrative procedures, the start of operations originally scheduled forJuly 2015 was postponed to October.

Monitoring reports
Project priority
Proposals for decisions, etc.

Response measures to the initial delay

Report to the Board of Directors at
the start, mid-term andcompletion of projects

Board of directors

Referred to the success factors of the Minamisanriku BIO project.
v3URMHFWPHPEHUVKHOGZHHNO\PHHWLQJVWRGLVFXVVEXGJHWVVFKHGXOLQJWKHGLVWULEXWLRQRIKXPDQ
resources and to develop contingency plans.
vEngaged actively with local residents and other stakeholders to develop positive relations andsecure their support for the project.
vApplied advice and expertise of notary publics and other experts outside the company in various
stages of the project. Others● May 2015: Start of construction (completed)● Aug. 2015: Announcement of change in start of operations

Management
planning department

Management
Project directors willreport to the project
managing directors

Regular monitoring(due dates, budget, quality)

Project managers▶Due to a delay in administrative procedures, the start of operations revised to Oct. 2015 wasagain postponed to Mar. 2016.
Project leader

Response measures to the second delayR e g a rd e d a s a n im p o r t a n t i s s u e fo r t h e e n t ir e o rg a ni z a t i o n w i t h
AMITA HOLDINGS taking the helm in handling the response.
vDispatched manager in charge of overseas businesses to Taiwan to negotiate with local parties.
v$0,7$+2/',1*6PDQDJHPHQWSODQQLQJSUHSDUDWRU\RIoFHZRUNHGZLWKWKHOHJDOGHSDUWPHQW
to ascertain the risks regarding the remaining construction and revised ways to manage scheduling. Efforts were made to step up communication between Japan and Taiwan, especially withregard to streamlining administrative procedures that were a major cause of the delay. By doing
so, we were able to avoid bringing progress to a halt.

Project members

Project members

Project members○ Dec. 2015: Plant completed○ Mar. 2016: Plant operation begins

35

Risk management

Challenges and measures in developing new businesses

Risk Management

Major risks and mitigation measures
In 2015, the development of new businesses such as the overseas development of recycling plants and the operation of the
Minamisanriku biogas facility called for investigations into new potential risks and deliberation of mitigation measures.

Category

Type of risk

All-out organizational response to the delay in opening the AMITA Taiwan Resource Recycling Plant led to thestrengthening of project management.
(Please refer to page 35 for details)↑

Since 2014, the development of services such as Best Way to Manage Waste that involve handling client information,and the company policy of supplying employees with smartphones, tablets and other intelligent devices, has madeinformation management an important priority. In addition to enforcing internal regulations and organizing IT training sessions, data operations are now restricted to physically secured areas. Additional security measures include
regular upgrades of website software.

→

v%HIRUHVLJQLQJFRQWUDFWVRURSHQLQJQHZDFFRXQWVZHFDUU\RXWVWULFWVFUHHQLQJWRDYRLGDQ\LQYROYHPHQWZLWK
antisocial elements.
v5DQGRPO\KHOGIRFXVJURXSPHHWLQJVRQZDVWHGLVSRVDODFWV PHHWLQJVLQ
v:HKDYHFRPSLOHGDGDWDEDVHRQUHF\FOLQJSDUWQHUVZLWKZKRPZHKDYHFRQWUDFWV:HUHIHUWRWKLVLQFDUU\LQJRXW
regular site audits and retrieving audit reports to make sure we are up to date on our partners' circumstances.
v0HDVXUHVLQFOXGHUHTXLULQJDOOHPSOR\HHVWREHWHVWHGDQQXDOO\IRUFRPSOLDQFH

→vDevelopment and regular reviewing of a disaster manual that provides guidelines on what to do in case of major accidents. Based
RQWKLVPDQXDOHPHUJHQF\GULOOVDUHFDUULHGRXWWZLFHD\HDUDWDOOSURGXFWLRQIDFLOLWLHVWRSUHSDUHIRUHDUWKTXDNHVoUHVOHDNDJHVWHPSHUDWXUHSURJUDPPHGUHDFWLRQDQGLQpDPPDEOHJDVHPLVVLRQVHWF
v:HKDYHWDNHQRXWoUHLQVXUDQFHWRHQVXUHWRWDOFRPSHQVDWLRQIRUGDPDJHV
vProvide alternative supply routes dependent upon our nationwide network of facilities and the amicable relationship we havewith partner companies.

Contamination of surrounding
environment→v)LYHSURGXFWLRQEDVHVKDYHUHFHLYHGDQGDUHLQFRPSOLDQFHZLWK(QYLURQPHQWDO0DQDJHPHQW6\VWHP,62FHUWLoFDWLRQ:LWKUHJDUGWRSURFHGXUHVWKDWPD\FDXVHVHULRXVLPSDFWRQWKHHQYLURQPHQWZHKDYHFOHDUPHDVXUHment requirements and conduct regular monitoring.
v:HKDYHWDNHQRXWHQYLURQPHQWDOOLDELOLW\LQVXUDQFHHWFWRVHFXUHSROOXWLRQFOHDQXSFRVWVUnderstanding and cooperation towards businessactivities from local residents↑

v$QDQQXDOWRWDORIORFDOUHVLGHQWVDQGFRPSDQ\UHSUHVHQWDWLYHVZHUHLQYLWHGRQSODQWWRXUVWRSURPRWHXQGHUstanding towards our activities. Minamisanriku BIO organized resident meetings with the help of local authorities
to promote awareness and support towards separating food waste from other household waste.
(AMITA took part in 30 of the 64 resident meetings held since 2014.),PSDFWRIH[FKDQJHUDWHpXFWXDWLRQV
Risk of yen/dollar exchange rate and assets denominated in foreign currency→v,QDGGLWLRQWR86GROODUGHQRPLQDWHGWUDQVDFWLRQVFDUULHGRXWZLWK7DLZDQHVH.RUHDQDQGRWKHURYHUVHDVFRPpanies, we expect an increase in local currency denominated transactions as we further our overseas presence.
To minimize risks resulting from changes in the exchange rate, we have established derivative risk management
policies and risk aversion measures.

Dependency on Loans/increase in interest expenses
GXHWR,QWHUHVWUDWHpXFWXDWLRQV↑

v/RDQVDFFRXQWIRURIWRWDODVVHWV DVRIWKHHQGRI'HF ,QDGGLWLRQWRORZHULQJRXUGHSHQGHQF\RQORDQV
E\LQFUHDVHGHDUQLQJVRXUSROLF\LVWRUHO\PDLQO\RQo[HGLQWHUHVWUDWHORDQVWRPLQLPL]HWKHULVNRILQWHUHVWUDWH
pXFWXDWLRQVRQORQJWHUPORDQV

Information leakage/DZVXLWVDQGWKHULVNRIORVLQJWUXVWIURPWKHOHDNDJHRISULYDWHLQIRUPDWLRQDQGFRQoGHQWLDOFRUSRUDWHFOLHQWLQIRUPDWLRQ

Violations and revoking of permits
Risk of AMITA CORPORATION's intermediate processing
business permit being revoked or operations shutdown due to violations of Waste Management and Public Cleaning Act and otherrelevant laws and regulations. Also, risk of violations committed
by companies for which we provided mediation or introductions.
Risk of other violations committed by the overall group or individual businesses.

Accidents/natural disasters
6KXWGRZQGXHWRoUHRXWEUHDNVDWSURGXFWLRQIDFLOLWLHVCommunity
relations

Financial risks

36

Mitigation measures↑↑

Project delays, exceeding budget

Business
operations

Changes in risk
level (2015)

Realizing a Sustainable Society

Reducing usage of natural resources

Energy input 1/2, greenhouse gas emissions 1/20

Saving vastly increased amounts of natural resources through recycling

Recycling methods that require large inputs of energy will not help realize a sustainable society.
$0,7$jVUHF\FOLQJWHFKQRORJLHVGRQRWLQYROYHWKHXVHRILQFLQHUDWRUVRUODQGoOOV%\DYRLGLQJWKH
XVHRIoUHDQGZDWHUDVPXFKDVSRVVLEOHRXUWHFKQRORJLHVERDVWORZHQYLURQPHQWDOLPSDFW2XU
CO2 emissions are 1/20 of the industry average. We aim to develop recycling technologies witheven lower environmental impact.

:KLOHWKHPLQLQJRIQDWXUDOUHVRXUFHVEHQHoWWKHUHVRXUFHSURGXFLQJFRXQWULHVDQGUHJLRQVLQWKH
form of employment creation and economic development, excessive mining and haphazard development may result in the removal of topsoil and rock, forest destruction and water contaminationthat can have a serious impact on the surrounding environment and people. Through the manufacturing of recycled products, AMITA is indirectly helping to reduce the use of natural resources.

INPUT
Raw materials

AMITA's recycled resource(alternative resource) products

Measurements

Period: Jan. 1-Dec. 31, 2015
Target plants: Minamisanriku*3, Ibaraki, Kawasaki,
Himeji, Kyotango, Kitakyushu

136,000 t
Other raw materials 12,000 t's performance

Energy1.95million kWh* Kerosene 59 kl
Diesel oil 145 kl
Gasoline 7 kl
Electricity

1

Waste processing industry average as
released by the National Institute forEnvironmental Studies

4.8 GJ/million yen
10 GJ/million yen

6,044 m102,970t

If this amount of recycled
specialty steel raw
materials (Ni, nickel) is
produced in one year...

3

2,071tIf this amount of recycled
copper...

717t

OUTPUT
Recycled products

EqualsReduction in amountof coal extracted is
3.7 times thevolume of recycledresources.

379,072 t
Reduction in amountextracted is 8.01
times the volume ofrecycled resources.

Amount of nickel saved:
Equals

16,596 t*

Amount of copper saved:
EqualsReduction in amountextracted is 60.5
times the volume ofrecycled resources.

43,349 t*Calculated from Ni substitutes among specialty steel raw materials (Ni, etc.). Please refer to page 13 fordetails about AMITA's production track record for all resources.

135,000 t
7,732 tLiquid fertilizer
Raw materials for metal substitutes 5,022 t
500,000 kWh
Electricity sold2,997tOthersCement materials (calorific)

Reducing CO 2 emissions by using renewable energy's track record
Waste processing industry averageas released by the National Institutefor Environmental Studies

Atmospheric emissions
Greenhouse gas emissions

Amount of coal saved:

Energy consumption rate per sales (million yen)

Water*2
Mains water

Savings in natural resources

If this amount of recycled
cement materials(calorific) is produced in
one year...

Industrial waste

Risk management/Realizing a sustainable society

Material balance

0.3 t-CO /million yen
6.1 t-CO /million yen
22

Rate of greenhouse gas emissions per sales (million yen)

AMITA promotes the use of natural energy at all its plants. For instance, the Kyotango Resource
Recycling Plant and Minamisanriku BIO use internally generated biogas electricity; the Kita※特殊鋼原料
（Ni等）
のうち、
Ni代替資源に該当するものから算出。
アミタの全資源製造実績はP22をご参照ください。panels; and the
kyushu Resource
Recycling
Plant uses
solar energy
produced by rooftop
solar
Ibaraki Resource Recycling Plant purchases renewable energy.

940 t-CO

2

Annual consumption ofnatural energy*1 Includes biomass generated electricity from Kyotango Resource Recycling Plant and Minamisanriku BIO.
*2 Excludes rainwater used at Kyotango Resource Recycling Plant and mains water used at Kawasaki Resource Recycling Plant. Mains water generally
UHIHUVWRWKHZDWHUXVHGDWRIoFHVDGMDFHQWWRWKHSODQW
*3 Minamisanriku BIO began operations in Oct. 2015.
=HURZDVWHZDWHUIURPSURGXFWLRQSURFHVV([FOXGHVZDWHUXVHGDWRIoFHVDGMDFHQWWRWKHSODQW

680,000 kWh

Reduction ofgreenhouse gas emissions

370 t-CO

2

Performance of Minamisanriku BIO, Ibaraki, Kyotango andKitakyushu plants

37

Stakeholder Communication

Fostering stakeholder relations to develop businesses
Generating stakeholder trust and empathy is crucial to the realization of a sustainable society. The AMITA Group iscommitted to providing stakeholder engagement in order to convey its beliefs, visions and strategies and encourage an
H[FKDQJHRIRSLQLRQV)HHGEDFNRQVWDNHKROGHUQHHGVDQGH[SHFWDWLRQVDUHUHpHFWHGLQRXUEXVLQHVVGHYHORSPHQWFramework for routing stakeholder feedback directly to management

Major needs/expectations from stakeholders
and response measures
Needs/expectations● Realization of environmental strategies in line with company visionemployees

Corporate clients,
municipalities

Seminars and eventsexecutives ascend(ten times a year)
Clients survey(once a year)

and strategies

Business ideas, feelings about
the company and desiredchanges go directly to the top
without being filtered throughthe chain of command.

Dialogue meetings(held several times a year at each facility)
CEO hotline (once a year)
Worker's council meetings (twice a year)
Employee survey (once a year)
Please refer to page 43 for results● Achieve safe, stable and inexpensive recycling● Improve cost performance and provide quicker service

Customers

Response

Shareholders→Develop system to integrate manufacturing and sales services→Restructure organization to better respond to customer needs→Development of new service that supports client companies fromenvironmental strategy planning through operation

General meeting of shareholders
Shareholder survey (once a year)

Needs/expectations

Please refer to page 42 for results

Implemented measures based on survey results
Ascertain customer concerns, demands anddissatisfaction and provide response measures
Reflect feedback on business strategies
Please refer to page 41 for results

Executive visits
Partner survey(once every three years)● Development and proposal of new environmental services● Reliability of three-year -plan● $FKLHYHoQDQFLDOVRXQGQHVV

Director
Interactive events(13 times a year)
Resident meetings/Supportof environmental education

Shareholders/investors

Participation in committee meetings
Exchange of opinions and ideas● Strengthen PR activities and release more information to raiseawareness and recognition of the company and its businesses

Actions→Strengthen management planning functions→5HYLHZDQGUHYLVHQH[W\HDUjVEXGJHWSODQQLQJpRZ→Improve website's IR (Information Retrieval) page

Needs/expectations
Government andregulatory bodies

Partners● Clarify standards and guidelines for business investments● Appropriate sharing of corporate earnings

Employees
Local communities,
students

38● Participation in business strategy design

Actions→5HYLHZDQGUHYLVHQH[W\HDUjVEXGJHWSODQQLQJpRZ→Explain business strategy policy to employees and provide opportunities for discussion

7KH81*OREDO&RPSDFW 81*& LVD8QLWHG1DWLRQVLQLWLDWLYHHVWDEOLVKHGLQDIWHUDSURSRVDOE\WKHQ816HFUHWDU\*HQHUDO.Ro$QQDQ,Q-XQHoQGing ourselves in total agreement with the 10 UNGC principles on human rights, labor, environment and anti-corruption, the AMITA Group became the fourth Japaneseorganization to join the initiative. We also put our efforts into establishing a Japanese local network GC-JN with other initial signees from Japan (Dec. 2003).
As a GC member, the AMITA Group is moving ahead with its commitment to align its business operations with UNGC principles and provides stakeholders with information on its actions via Communication on Progress (COPs) reports submitted to UNGC headquarters.
COPs(Communication on Progress)
The Ten Principles of the UN Global Compact

Details and aims of actions in FY 2015

Human rights■ Maintaining employee health

Covered partial costs of follow-up health checks and strengthened efforts to
support employees in need of further diagnosis.

1. Support and respect the protection ofinternationally proclaimed human rights■ Promote local employment measures and hire local nationals.
Promoted employment practices that comply with local customs.

■ Help to preserve the human dignity of disaster victims.
Aided and supported disaster stricken areas.

2. Make sure not to be complicit in humanrights abuses
3. Upheld the freedom of association andthe effective recognition of the right tocollective bargaining.
Labor

4. Support the elimination all forms of forced
and compulsory labor

5. Support the effective abolition of child labor
6. Support the elimination of discriminationin respect of employment and occupation
7. Support a precautionary approach toenvironmental challenges

Environment

8. Undertake initiatives to promote greater
environmental responsibility■ Support activities to tackle human rights issues and other social problems.
1. Provide employees and management with opportunities to discuss theworking environment together.
2. Create an environment that enables employees to propose suggestions for
improving the work environment.

■ Improve work environment (develop an environment that enables
employees to continue working)

1. Improved AMITIME System to support employees who needed to take leave or work
shorter hours in order to care for children or sick or elderly relatives.
2. Develop a variety of work styles.
3. Study the possibility of rehiring former employees after retirement.

■ Prohibit and prevent discriminatory practices with regards to thework environment of employees at overseas plants.

Develop local resource circulation models based on symbiosis and biomass
technologies.

■ Technology development

Anticorruption◎

v6L[RIWKHHPSOR\HHVDWRXUELRJDVIDFLOLW\0LQDPLVDQULNX%,2ZHUHKLUHGORFDOO\v7ZRORFDOQDWLRQDOVZHUHKLUHGDWWKH$0,7$7DLZDQ5HVRXUFH5HF\FOLQJ3ODQW

-◎v3URSRVHGHQHUJ\VHOIVXIoFLHQF\DWWKHGLVDVWHUSUHYHQWDZDUHQHVVHYHQWFukushiga Project vol. 2 Sonaeru marushe(Disaster preparedness fair).
v&RVSRQVRUHGPrivate University Network 36 , a networking study tour of the Tohoku region to promote reconstruction.

-◎

v*DYHEDFNLQJWRKurashi no Manabi-an , an initiative to develop mutual aid and self-help projects to prevent social isolation.
v&RRSHUDWHGLQWKHSODQQLQJRISocial Cinema Dialogue@Kantele (Organized by Kansai Telecasting).

-◎

1. Organized company meetings where management and employees were able to discuss improvements
to the work environment.
2. Created an internal SNS network where everyone could post their opinions to provide a forum fordeveloping a better working environment and create a positive corporate culture.

P40○

1. Decided to ease requirements for using the AMITIME System. (Revisions effective from April 2016)
2. Studied the possibility of introducing a shorter-hour work system and allowed one employee to make use of thesystem on a trial basis. (Full-scale implementation to begin in 2016)
3. Reviewed personnel management systems in preparation for rehiring retired employees. (Effective from 2016)

P40○

In order to maintain the same work environment level as in Japan, employees scheduled to work atoverseas plants underwent on-the-job training in Japan. (In Jan. 2016)○

v7KH.\RWR.\RWDQJRELRJDVEXVLQHVVDFKLHYHGWDUJHWSHUIRUPDQFHYDOXHV
v6WDUWRIELRJDVIDFLOLW\0LQDPLVDQULNX%,2LQ0LQDPLVDQULNX0L\DJL3UHIHFWXUH
v6XSSRUWHGWKHSURPRWLRQDQGLQWURGXFWLRQRIV\PELRWLFIDUPLQJLQ.DJD&LW\,VKLNDZD3UHIHFWXUHWRHQKDQFHELRGLYHUVLW\
Pages 24-29
v)HDVLELOLW\VXUYH\VDQGSLORWWHVWVFRQGXFWHGLQ-DSDQ .\RWR DQGRYHUVHDV 9LHWQDPWKH5HSXEOLFRI3DODXHWF ◎

Developed new products with the aim of becoming a business partner for companies that need to achievesustainability despite increasing environmental constraints. (Full-scale provisions from 2016)△

Implement pilot testing of new recycled products. Considering patent application for new technologies
developed for this purpose.

○

1. Expand domestic recycling network.
Establish AMITA Terrestrial Resources Manufacturing Partners.
6WDUWHGRSHUDWLRQVRI)XML7UDQVSRUW&RUS/WGjVUHVRXUFHUHF\FOLQJSODQWLQ1LLJDWD3UHIHFWXUHDQGRSHQHG$0,7$&RUSRUDWLRQ1LLJDWDRIoFH
2. Signed 14 contracts for waste management business outsourcing and other services. Expanded sales of Digital Waste ManPages 10-23
DJHPHQW6\VWHPDVHUYLFHWKDWLPSURYHVZDVWHPDQDJHPHQWEXVLQHVVHIoFLHQF\DQGHQVXUHVFRPSOLDQFHWROHJDOUHJXODWLRQVv'HOD\LQRSHQLQJWKH$0,7$7DLZDQ5HVRXUFH5HF\FOLQJ3ODQW 6WDUWRIRSHUDWLRQVH[SHFWHGLQWKHoUVWTXDUWHURI)<v)XUWKHUSURJUHVVRQGHYHORSLQJUHF\FOLQJEXVLQHVVLQ0DOD\VLD
v$FFHSWHGWUDLQHHVDQGYLVLWRUVIURP6RXWKHDVW$VLDDQGSURYLGHGWUDLQLQJ

◎1. Continuing FY 2014 practice of thoroughly investigating clients.
2. In addition to compliance testing, sexual harassment awareness checks were conducted in FY 2015.
3. vIn order to avoid compliance violations, we contracted local law agencies well versed in the overseas
regions in which we operate to serve as consultants.
vOverseas risk management training was provided to relevant employees.

■ Preventive measures
10. Work against corruption in all its forms,
including extortion and bribery

1. Continue to conduct investigations and screening to prevent transactions, etc., with
anti-social elements.
2. Conduct compliance testing to raise awareness of compliance issues among employees.
3. Make preparations for overseas business development.

Relatedpages-■ Technology diffusion

1. Develop recycling market by providing recycling technologies and support
to factories of partner companies
2. Promote and enhance quality of waste management outsourcing services.
3. Develop recycling markets outside Japan.

FY 2015 Performance
Covered full cost (100%) of four such applications received.

Maintain the same level of work environment as in Japan.

■ Revitalize communities with environmental technologies

Please refer to the UN website for details on
the UN Global Compact.
http://www.unglobalcompact.org/◎■ /DERUQHJRWLDWLRQVDevelop and manufacture new recycled products (terrestrial resources).

9. Encourage the development and diffusionof environmentally friendly technologies

Assessment

Stakeholder communication

Participation in the UN Global Compact and our activities-

Pages 10-23

P36

39

Stakeholder Communication

Defining AMITA's structure
The AMITA Group hopes to create a working environment that allows employees to feel that they are part of a "work family" that compliments their blood relations and community life.
We envisage a community of motivated people who are able to inspire each other and work together as colleagues towards a common goal. We believe this leads to the creation of new values and provides
them with a sense of accomplishment and purpose that cannot be achieved on an individual basis.

Initiatives to create value

The AMITA Group's Employment conditions,Welfare and Benefits

To support the development of "value-creating human resources," the Human Resources Department
organizes various educational programs for employees. We also encourage and support employees whotake the initiative to pursue other sources of education and training.

The numbers cover Jan. 1 to Dec. 31 of each year.
(The number of days taken off, childcare leave and leave taken to care for relatives cover Jan. 11 to Jan.
10 the following year)

Educational programsGroup training for
employees of the same grade
Organized to develop individual
capacity and performance and enhance communication.

Employee organized initiatives
Empathy withmissionCollaboration
capacity

Valuecreating
capacity

Executive training

Reading assignment system

Number of employees (full time)

Qualities of value-creating
human resources
vStrong empathy with mission
vWillingness to work andcollaborate with colleagues
vHigh value-creating capacity

This is a project launched in 2007 to identify and addressideas from the perspective of employees. Employees areinvited to submit ideas for new businesses. If the proposal
is recognized, a preparation committee moves to develop
and realize the business. The Emergence Project was organized in 2015 for theoUVWWLPHLQVL[\HDUVUHVXOWLQJLQSURSRVDOV)RXUZHUHDSSURYHGDQGDUH
in the process of being developed.
The AMITA Group encourages employees to take initiative and create value
regardless of division or grade. The Emergence Project is one example of thiscreative working environment.

FY 2013

FY 2014

FY 2015

149

143

147

Male

76%

75%

71%

Female

24%

25%

29%

3%

8%

5%

39.05 years

38.18 years

39.90 years

Average period of employment

8.42 years

7.81 years

8.95 years

Employee turnover rate

12%

13%

6%

Employment of people with disabilities

2%

2%

2%

AMITA "Waigaya" Brainstorming Sessions

Number of days taken off per employees*

11.3 days

13.14 days

12.24 days

Employees get together to holdbrainstorming sessions on subjectsof interest. Held 20 times a year tobring about a richer social climate
and deepen knowledge.

Caring-for-sick children leave-

5 days9 daysShort time working hours

4 days

5 days

5 days3

Study groups
Organized by employees to further
their knowledge on various topics.
Employees who are well versed on the
FKRVHQWRSLFVHUYHDVOHFWXUHUV/HFWXUers are also invited from outside thecompany. Held ten times a year.

Male to female ratio

Employment Proportion of management positions occupied by female staff
conditions
Average age

Welfare andEHQHoWVV\VWHP

Childcare leave
Days acquiredChildcare leave

2

5

Number of employees taking care leave

-

1

1

Use of AMITIME System

1

4

5

Book club
Employees get together to discussa book that has been recommended
by a club member. Held to further
insight and develop perspective, theclub meets nine times a year.

Emergence Project organized for the
first time in six years
TOPIC

40

Initiatives/Performance

Topic examples: Excessive exploitation ofmining resources in the Philippines
Global water problems
Fundamental CSR, Product focus groups

Held every month to enhance leadership qualities and management
skills.

Books are assigned for each grade
to acquire necessary knowledge
and deepen perspective.

Categories* Total amount of annual paid leave, special incentive leave, community engagement leave and anniversary leave.

AMITIME System "Let your colleagues take advantage of leave otherwise lost"$UHpHFWLRQRI$0,7$jVSKLORVRSK\WKDWQRWKLQJLQWKLVZRUOGVKRXOGJRWRZDVWHWKLVV\VWHPZDVLQWURGXFHGLQWR
allow employees to work with peace of mind.
Instead of letting unused paid leave expire, the unused leave is stored up so that other employees who need to take care of
their children or relatives can make use of this otherwise wasted paid leave to take off or work shorter hours. The system
is overseen by employees and is continuously being revised. Application requirements, for instance, have been eased.

User feedback

2015
Emergence Project presentation

Work division:
Environmental strategic support teamName: Hiromi Takahashi
Number of years employed: 12 years

I've taken advantage of the Shorter-Work Hours and AMITIME System
to spend more time with my three children. The use of these two systems
has allowed me to witness their day-to-day growth and respond to theirneeds. Since I don't have to rush to work, I can cater to my children's
demands and take a leisurely stroll to day care. I think it's very importantto provide hands-on care for one's children. My colleagues recognize thevalue of spending quality time with the family and are so supportive that
I feel motivated to give the best I can to my work as well as my family.

Stakeholder Survey

Survey outline

01

Survey group: clients
Respondents: 304 clients of recycling services (out of 915 who received the survey), 104 clients of
HQYLURQPHQWDOFHUWLoFDWLRQVHUYLFHV RXWRIZKRUHFHLYHGWKHVXUYH\

02

O p inions on A MITA's ser v ic es

Recycling services
7KHSHUFHQWDJHRIUHVSRQGHQWVZKRZHUHVRPHZKDWVDWLVoHGVDWLVoHGRUYHU\VDWLVoHGLPSURYHG
VOLJKWO\IURPODVW\HDUDQGWKH\HDUEHIRUHODVW+RZHYHUWKHWRWDOQXPEHURIVDWLVoHGDQGYHU\VDWLVoHGUHVSRQGHQWVUHJLVWHUHGDIDOO:KLOHVRPHH[SUHVVHGVDWLVIDFWLRQDWKRZWKHVDOHVVWDIIFRQWDFWHGWKHPUHJXODUO\RWKHUVFLWHGLQVXIoFLHQW
visits from sales staff, pointing to discrepancy in service quality depending on the region and individual
staff. We intend to come up with measures that will allow us to provide quality services far and wide.
(QYLURQPHQWDOFHUWLoFDWLRQVHUYLFHV
6DWLVIDFWLRQRI$0,7$jVHQYLURQPHQWDOFHUWLoFDWLRQVHUYLFHVDOVRVKRZHGDVOLJKWLQFUHDVHRYHUODVW\HDU
We will continue to implement measures that will enable us to meet demands for lower assessment costs
and step up promotion and publicity.

Stakeholder communication/Stakeholder survey

Client survey results
Survey period: October 9 – November 30, 2015
Survey method: E-mail and postal mailPro d u c ts a n d s e r v ic e s

Satisfaction levels on our recycling services were itemized as follows. While we received high marks on ourphilosophy, vision, compliance levels, expertise, attitude and responsiveness of sales staff, there was a somewhat lack of satisfaction regarding cost performance and response speed in providing estimates and results.
Very satisfied

Satisfied

NeutralUnsatisfied

Not at all satisfied

1. AMITA's philosophies and vision
2. Appeal and quality of AMITA products
3. Cost performance
4. Quick provision of estimates and prompt delivery
5. Level of compliance
6. Knowledge and expertise of sales staff
7. Attitude of sales staff
8. Troubleshooting response speed/HYHORIFOLHQWVDWLVIDFWLRQHQYLURQPHQWDOFHUWLoFDWLRQVHUYLFHV/HYHORIFOLHQWVDWLVIDFWLRQ UHF\FOLQJVHUYLFHV（％）100
80

20
6

13
11

8

Not at all
satisfied

23

Unsatisfied
Somewhat
unsatisfied

60（％）100
80

54

60

54

20
0

SomewhatsatisfiedSatisfied

15

13

13

2013

2014

2015

Very satisfied

6

40
20
0

25
9

60

Neutral
40

15

57

45

19

16

2013

2014

13
11

57

10

2015

0

50％

100％

Response to survey results
The results showed that our clients regard us in a satisfactory light as an environmental business
partner who can provide problem solutions, speedy troubleshooting, with a high level of compliance.
Clients also pointed out that our information-providing tools such as Recycling Bulletins and Daily
AMITA Update (http://www.amita-oshiete.jp/）and various seminars were helping to boost theirenvironmental value. Unfortunately, we received quite a few comments from clients who pointedout discrepancies in the expertise and responsiveness of individual sales and support staff. We will
work on improving the expertise of all staff members, making sure they visit clients regularly andspend more time with them, while improving response speed. By enhancing the hospitality we extend
towards our clients, we hope to cultivate better trust and improve our proposal-making capacity.

Management response
We are truly grateful for the understanding and empathy of our clients with regards to our philosophy that "Nothing in this world should go to waste" and our vision of realizing a sustainable society. We also appreciate yourthought provoking feedback on cost performance, client response speed and frequency, which has made us bitterly
aware of the need to improve our operations. In 2016, we begin fundamental reviews on business and product de-velopment strategies and will work towards improving client response speed and frequency by strengthening back
RIoFHFDSDFLW\:HZLOODOVRLQWHJUDWHPDQXIDFWXULQJDQGVDOHVIXQFWLRQVLQHDFKUHJLRQWRLQFUHDVHRXUFOLHQWHOHDQG
provide more client-oriented services. By doing so, we hope to live up to your expectations and strengthen our environmental business partnership and enhance your corporate value.

41

Stakeholder Survey

Shareholder survey results
Survey outline

01

Survey period: October 9 – November 30, 2015
Survey method: Enclosed with "Designing the Future Newsletter" sent to shareholders and investors

Survey group: shareholders (as of June 30, 2015)
Respondents: 23 shareholders (out of 586 who received the survey)

Opinions and expectations regarding AMITA Group businesses andthe areas which call for improvement. (Multiple answers allowed)

The most common opinions expressed in the survey
were: agreement and encouragement for AMITA's business at 31%; expectations for a higher stock price and
LPSURYHGoQDQFLDOSHUIRUPDQFHDWDQGEHWWHUSURPulgation of IR information and corporate communication
activities at 11%.
The 2015 survey generated a considerable amount ofcriticism regarding the stagnancy in business recovery
and stock price. The opinions and expectations of ourshareholders provide us with valuable feedback, which ismade available to all managers. We are sincerely gratefulfor your constructive criticism and vow to do our best
to live up to your expectations. FY 2016 will see our directors standing on the frontline of business operations.
They will take the help in developing measures to improve performance and recover stakeholder trust.

No response 31%

Bolster IR
and corporate
communication activities
11%

Agreement andencouragement 31%

Higher stock price andimproved financial
performance 27%

02

What aspect of the AMITA Group would you like to know
about in more detail? (Multiple answers allowed)

The most common response was: mid- tolong-term management strategy, followed
by trends in major business domains andnew businesses. We interpret these results
as an interest in how the group businesses
and performance will evolve. In order toenhance understanding of our financial
situation, profitability and future growthstrategies, we are in the process of revitalizing corporate communication activities.
In 2016, we aim to enhance understanding
and recognition by increasing opportunities to communicate directly with ourshareholders and organize seminars forinvestors.

Mid- to long-term managmenet strategy
Trends in major business domains
Trends in new businesses
Dividends policy
Management policy and philosophy
Approach of top management
Finances and results
Environmental contributions
Policies for human resources development
Investment plans
Governance structure

0

2

4

6

8

10(name)■Common comments- Make a speedy business recovery- Remember the starting point and vigorously pursue robust strategies. A company for which everyone ishappy to work for.
(YHU\HPSOR\HHVKRXOGFRQVLGHUPHDVXUHVWRLQFUHDVHSURoWDELOLW\0DQDJHUVVKRXOGWDNHWKHKHOPLQdeveloping and implementing such measures.
&RQVLGHUpXFWXDWLRQVLQVWRFNSULFHIURPWKHVKDUHKROGHUjVSHUVSHFWLYH/LYHXSWRVKDUHKROGHU
expectations and trust by improving the stock price.
'LIoFXOWWRWUXVWDFRPSDQ\WKDWIRUHFDVWVSURoWVDWWKHEHJLQQLQJRIWKHSHULRGDQGUHYLVHVWRGHoFLWVright before the end of the period. The lack of trust limits stock trading volume and explains theminimum growth in the number of shareholders.
%HOLHYHVWKHFRPSDQ\LVVLJQLoFDQWWRVRFLHW\DQGZRXOGOLNHWRUHPDLQDORQJWHUPVKDUHKROGHU
However, the steady decline in the stock price makes one feel whether it's worth holding on to the stock.

03

What sort of IR information would you like to see on our website?

The most common response echoed thatof Question No.2: More information on
the stock price and business forecasts. We
intend to make the most of web features todisclose up-to-date information which wehope will help cultivate the understandingof shareholders and investors.

18％

18％

Information on finances and stock price,
future prospects
64％

Business description
OthersManagement response
We deeply regret not being able to live up to your expectations for the past several years. AMITA's leadership promises tomake the most of your valuable feedback to make utmost efforts to improve performance and regain your trust. 2016 will
EHD\HDURIPDMRUFRUSRUDWHUHVWUXFWXULQJ,Q-DQXDU\ZHUHSODFHGWKH3UHVLGHQW &(2VRIWZR$0,7$+2/',1*6VXEVLGLDULHVDQGLQ0DUFKDSSRLQWHGQHZH[HFXWLYHVWR$0,7$+2/',1*6ZLOODOVRVHHWKHGHYHORSPHQWRIQHZPDUkets and improvements in existing businesses. After being delayed for some time, the AMITA Taiwan Resource Recycling
3ODQWKDVoQDOO\EHHQRSHQHG:HEHOLHYHWKDWVWHDG\RSHUDWLRQVRIWKH7DLZDQSODQWWKHSURYLVLRQRIQHZHQYLURQPHQWDO
strategy support services and the increase in IR information output will enable us to meet your expectations.

42

In addition to meeting the legal disclosure requirements for IR materials, we also issue an annual report(voluntary annual reporting document) each spring, which is the publication you are reading at the moPHQW7LWOHG&UHDWLQJ9DOXH7KH$0,7$:D\LWSURYLGHVoQDQFLDOUHVXOWVIRUWKHSUHYLRXVoVFDO\HDU
and outlines our future vision. We also publish a "Designing the Future Newsletter" for shareholders and
LQYHVWRUVLQWKHDXWXPQ,WUHODWHVPLGWHUPSURJUHVVRQEXVLQHVVDFWLYLWLHVDQGWKHoQDQFLDOVLWXDWLRQIRU
he second quarter. Past articles can be accessed from our website.
http://www.amita-hd.co.jp/ir/future.html

Survey outline

01.H\oQGLQJVKLJKOLJKWHGEHORZ

Survey group: AMITA Group employees (around 150)
*The survey did not include executives, contract workers and part-timers

Respondents: 114

Response rate: 76.0%

02

E mployee perce ptions of their jobs

Is your current job with the AMITA Group worth
In response to the question "Is your current job worth
devoting your life to? (Three year transition)
devoting your life to?" 61 % of the 114 respondents
VDLG\HV0DQ\RIWKHDIoUPDWLYHDQVZHUVUHpHFWHGWKH
Yes
Not sure (average)Noempathy they felt with AMITA's mission and business（％）100activities. The reasons cited included the feeling of
22.8
23
making a contribution to society, and sharing the same80
ideals and vision for the future. Also, in response to
47
16.7
15
the question, "Do you feel proud of working for AM-

ITA?" close to 80% of the respondents (90 employees)
said yes. However, only 38% answered yes to the question "Do you have expectations towards the company's
future?" The reasons citied included "Poor business
UHVXOWVDQG/DFNRIKXPDQUHVRXUFHV

60
40
20
0

■Common comments"Feel strong empathy towards the mission
and ideals. But am seriously concerned overthe stagnant sales and growth in recent
years." "The sense of pride and fulfillment
is what you make of it. Instead of leaving
things in the hands of the management, we
all need to work together to achieve better
results by designing and implementing
business strategies, develop new products
and improve operational efficiency." "We
need to implement concrete measures as soon
as possible to bridge the gap between lofty
ideals and reality."

62

53

2013

2014

60.5

2015

*The response choice "Not sure (average)" was not offeredin the 2013 survey.

Do you feel proud of working for AMITA?
4
1

26

19

Very much soFairly so
Average/not sure64

Survey period: August 31 – September 17, 2015
Survey method: E-mail and postal mailNot veryNo

Sense of mutual trust and communication with the management

In response to the question, "One human resources
development principle is that people are to be considered an asset, not a cost. Do you feel this thinking
is being implemented?", the percentage of people
who answered, "yes" fell from last year's 40% to 29%.
Major reasons cited included: cuts in bonuses andEHQHoWVGXHWRSRRUEXVLQHVVUHVXOWVLQFUHDVHRIZRUNORDGHWFUHpHFWLQJWKHQHHGWRSULRULWL]HRSHUDWLRQDO
reforms and improve business performance in orderto develop a relationship of mutual trust between
management and employees. In response to questions
about whether managerial decisions were trustworthy
and convincing, many respondents approved of the
Chairman Town Hall Meetings held at every base.
However, regarding the question, "Do you feel emSOR\HHDQGFXVWRPHUIHHGEDFNLVUHpHFWHGLQPDQDJHrial decisions?" only 31% answered "yes", which showsthat there is much need for improvement.

■Common comments"Top leadership visits operational bases to personally explain structural reforms and strategies forthe next period." "Chairman Town Hall Meetings
provided understanding of the company's intentions. But there's no sense of our voices being
heard by the management." "There are times when
it feels like the opinions and reports from a small
group of people who are right behind the management are regarded as the majority opinion." "Themanagement needs to understand the reality offront-line operations." "Improvements in employee
education programs gives a sense of investment
being made on human resources."

One human resources development principle is that people are to be considered an asset, not a cost. Do you feel this thinking is being implemented?
(Three year transition)

Yes
No

Not sure (average)（％）100

21
80

35

47
39

60

36

40

32

20

21
0

2013

Are managerial decisions
trustworthy and convincing?

40

29

2014

2015

Do you feel employee andclient feedback is reflected inmanagerial decisions?

7 4

4 9
16

31

25
46
39

46

Very much so

Not very

Fairly soNoOrdinary/not sureManagement response:HWUXO\DSSUHFLDWHKRZVRPDQ\HPSOR\HHVEHOLHYHLQ$0,7$jVVRFLDOVLJQLoFDQFHDQGDUHZLOOLQJWRFRPPLWDSUHFLRXVSDUW
of their lives to realize a sustainable society. At the same time, we realize we must act promptly to improve sentiments about
how our "people should be considered an asset and not a cost" principle is not being implemented properly and how employee
IHHGEDFNLVQRWEHLQJUHpHFWHGLQPDQDJHPHQWVWUDWHJLHV:HDLPWRPDNHWKLVLVRQHRIWKHSULRULWLHVRIRXURSHUDWLRQDOUHIRUPVDQGLQWURGXFHPHDVXUHVV\VWHPDWLFDOO\6SHFLoFDOO\WRKDYHDOOGLUHFWRUVYLVLWIURQWOLQHRSHUDWLRQVDQGHQJDJHLQ7RZQ+DOO
meetings; improve employee education and evaluation systems and strengthen mutual aid programs; balance work load andreduce overtime work through the development of IT infrastructures, organizational and structural reforms; and provide more
opportunities for employees to partipate in corporate and business strategy design.

43

Stakeholder survey

Employee survey results

2016$0,7$’S

ORGANIZATION

Organization structural reforms to improve business performance and value propositions
The AMITA Group is aiming to build an organizational structure that will enable sustainable earnings andsocial value propositions.
,Q)<ZHDSSRLQWHGDQHZGLUHFWRUWR$0,7$+2/',1*6&R/WGDQGPDGHVRPHFKDQJHVLQWKH
leadership, including CEOs, of our two subsidiaries, AMITA CORPORATION and the AMITA Institute for
6XVWDLQDEOH(FRQRPLHV&R/WG7KHQHZPDQDJHPHQWZLOOZRUNWRJHWKHUWRDFKLHYH$0,7$jVJRDOVNew Organizational Structure of
AMITA HOLDINGS Co., Ltd.

New Management structure of
subsidiaries([HFXWLYH'LUHFWRUV1RQH[HFXWLYH'LUHFWRU$XGLW 6XSHUYLVRU\%RDUG0HPEHU

1
2

Five directors were reappointed and one new director appointed at the General meeting of Shareholders on March 29, 2016.

*For bios of Audit & Supervisory Board Member, please refer to the company website at: http://www.amita-hd.co.jp/ir/management.html

Name

Responsibility

Founder & CEO

Eisuke Kumano (reappointed)

Strategy design

COO

Kenichi Sugimoto (reappointed)

Business operations, general andlegal affairs

CSO

Takafumi Hasegawa (reappointed)

Resources manufacturing andproduction management

CBO

Hiroyuki Sato (newly appointed)

Business development and sales

CFO

Taro Shimizu (reappointed)

Finance and accounting

Non-exective Director

Emile H. Ishida (reappointed)-

On the appointment of Hiroyuki Sato as CBO

To nurture next generation leadership and younger managers.

With the expectation of achieving these two main goals, Sato was appointed CEOof AMITA's subsidiary on January 1, 2016.

AMITA CORPORATIONBusiness
outlineTitle

To bring about a change in style at existing operations and strengthen thedevelopment of innovative new business.

Environmental Strategy Design Business

Regional Design Business

Provides companies with comprehensive
support on environmental strategies*Please refer to pages 10-23 for business details.

Development of comprehensive resource
circulation systems tailor made for each region*Please refer to pages 24-29 for business details.

Executives after change

Executives prior to changes
Title

Name

Chairman

Eisuke Kumano

Managing Director

Kenichi Sugimoto

Senior Managing
Director

Takafumi Hasegawa

Director

Eizo Takimoto

Director

Taro Shimizu

In 2015, the AMITA Group consolidated its business domains into the Environmental Strategy Design
Business and Regional Design Business. Existing directors were mainly in charge of environmental strategy design. The decision to appoint Sato as director was based on his track record in developing many new
regional design businesses.

Title

Name

Chairman

Eisuke Kumano(reappointed)

CEO

Hiroyuki Sato(newly appointed)

CBO

Takafumi Hasegawa(reappointed)

CFO

Taro Shimizu(reappointed)

AMITA Institute for Sustainable Economies Co., Ltd.
Profile of new executive

44

Business
outlineBorn 1965. After serving as Managing Director of Green Purchasing Network; and the Secretary-General of the Global Ecolabelling Network, hejoined the AMITA Group in 2008 where he was primarily in charge ofdeveloping new businesses in the domains of regional design and naturalindustries. In January 2015, he was appointed President and CEO of the$0,7$,QVWLWXWHIRU6XVWDLQDEOH(FRQRPLHV&R/WGDQGSURPRWHGWKH
development of new markets for resource circulation models in regions
such as Minamisanriku, Miyagi Prefecture. As project leader of corporate
environmental strategy support services, he has been at the helm of operational reforms since FY 2015. On January 1, 2016 he was appointed CEO of
AMITA CORPORATION.

R e g i o n a l Desi g n Bu si n ess
Development of local comprehensive resource circulation systems*Please refer to pages 24-29 for business details.

Executives after change

Executives prior to changes

Hiroyuki Sato&%2 RI $0,7$ +2/',1*6&R/WGDQG&(2RIAMITA CORPORATION

Title

Name

CEO

Hiroyuki Sato

Senior Managing
Director

Takafumi Hasegawa

Director

Taro Shimizu

Title

Name

CEO

Shiro Kadoshin(newly appointed)

CSO

Hiroyuki Sato

CFO

Taro Shimizu

Interviews with CEOs of subsidiaries

AMITA HOLDINGS Organizational Structure for FY 2016

CBO, AMITA HOLDINGS Co., Ltd. andCEO of AMITA CORPORATION Hiroyuki Sato

$0,7$+2/',1*6VHUYHVDVWKHFRPSDVVZD\oQGHUIRUWKHHQWLUH$0,7$*URXSVHWWLQJVWUDWHJLFGLUHFWLRQ
and management strategy. It consists of the Business Strategy Group that performs the functions of Business
Design; General and Legal Affairs and Human Resources; Corporate communications and IR: Sales Promotionand Marketing: and IT; and the Finance and Accounting Management Team and the Internal Auditing Team.

Interview 1

Q. How do you see your role as a CBO of AMITA HOLDINGS and the CEO of AMITA CORPORATION?
A. In the past, the AMITA Group relied on its 100 % to engage with a wide range of stakeholders andrecycling services for much of its earnings. However, amidst increasing environmental restraints,
we need to be able to provide corporations withsupport in designing comprehensive environmental strategies to enhance sustainability. At the sametime, we also need to provide regional support bydeveloping cycling systems that make the most of
locally available natural resources.
Because of my involvement in developing numerous new businesses, I have experienced more
failures than most other people. I regard such
failures to be my major asset. I believe my role iscultivate a relationship of mutual understanding
while taking on the responsibility of new businessdevelopment. This year, AMITA CORPORATION,
in particular, will undergo a change of styles inevery single department, ranging from sales, manufacturing and customer service. I believe that our
unrivaled capacity to design Comprehensive Cyclical System of Resource Usage that bring together different ways of realizing a common vision,a capacity nurtured by our experience in developing a comprehensive resource circulation model in
Minamisanriku since 2011, will serve us well.

Major changes in 2016
■ A new team dedicated to management planning was set up to strengthen strategic design

capacity and PDCA management functions of on-going projects■ Abolished the Management Support Group and consolidated management functions under

the Company Design Team
General meetingof shareholders
Board ofdirectors

An independent corporate governance body that determines audit
Audit andSupervisory Board policies and scheduling and attends Board of Director meetings.

CEOInterview 2

AMITA Institute for Sustainable Economies Co., Ltd.
Shiro Kadoshin, CEO

Q. How do you see your role as CEO of the AMITA Institute for Sustainable Economies Co., Ltd.?
A. I was responsible for starting up the Kyotango

Resource Recycling Plant in 2005. Otherwise
known as the Kyotango City Eco Energy Centre,
it's one of the largest biogas facility in Japan.
Minamisanriku BIO, which started operation in
2FWREHUUHpHFWVDOOWKHOHVVRQVZHOHDUQHG
through trial and error in the Kyotango project.
0\PLVVLRQLVWRUHpHFWP\WUHDVXUHWURYHRIWULDO
and error in developing the technologies anddesigning the businesses that will help realize
a sustainable society and complete the resource
circulation model in Minamisanriku promptly allowing expansion into other areas. My main role,
however, will be to pass on the baton of life to
the next generation; in other words, to serve as a
guide and pass on the philosophy and knowhow
of the AMITA Group to younger people.

New
Business
StrategyGroup

Management
Planning
Team

Is in charge of management planning of the
AMITA Group, including the development of
AMITA's 10-year vision, management strategy
designs, and the PDCA management of major
projects.

Company
DesignTeam

Performs human resources functions. Cultivates
human resources with the empathy and skills
necessary for value-creation. Integrated with legal
and general affairs in FY 2016 to reduce corporaterisk and create systems for increasing value.

Empathy
CapitalTeam

Performs PR and IR functions. Enhances
corporate value and invests in human resources
development to turn people into assets byencouraging participation, utilization andcooperation.

MarketingTeam

Performs marketing and sales promotion functions. Incorporates customer perspective intobusiness management.

IT Team

Performs IT strategy design and development functions. Builds essential IT
platforms for management strategies.

Accounting
Management
Team

Enhances corporate value by setting budgets based on business plans; manages
performance; and implementing meaVXUHVWRLPSURYHSURoWDELOLW\

New executive profile
Born 1974. Joined the AMITA group in 2000. After serving as the project leaderof the biogas facility in Kyotango and setting up various other businesses suchas Forest Farm, transferred to the AMITA Institute for Sustainable Economies
Co., Ltd. in 2011. He worked mainly on developing resource circulation technologies for Minamisanriku and was responsible for business development.
His strengths lie in his detailed business design capacity and excellent communication skills that enable him to establish relations and negotiate with a wide
range of stakeholders. He has served as the driving force behind the development of new business domains for many years.

Shiro Kadoshin
AMITA Institute for Sustainable
Economies Co., Ltd.
CEOCollaborates in establishing AMITA's
corporate culture
and style.
Collaborates in enhancing AMITA's
corporate value anddeveloping clientsin new markets.

Internal
Auditing
Team

45

Our Mission Ⅱ
Wisdom and life are infinite.
Through changes in our surroundings and the evolution of sympathy,
The formation of external and internal relationships create us.
There are no stable phenomena; the universe is in flux.
Because we are who we are,
We need to have a good relationship with infinite life.
Our hearts hold everything that humanity seeks.
What humanity seeks is to protect the dignity of our future children.
We have the passion to give this goal a form and offer it.

We declare.
To attest that life is capital to create value,
To give priority to building cyclical relationships for realizing
a sustainable society,To conduct only business that contributes to increasing natural capitaland human relation capital, andTo protect the dignity of living systems.

AMITA HOLDINGS Co., Ltd.
AMITA HOLDINGS Co., Ltd.
535 Akinono-cho, Oshikoji-agaru, Karasuma-doriNakagyo-ku, Kyoto, 604-0847 Japan
TEL: 075-277-0378 FAX: 075-255-4527
e-mail: press@amita-net.co.jp
JASDAQ (Securities Code 2195)
http://www.amita-hd.co.jp/

Published by: AMITA HOLDINGS Co., Ltd.
Publisher: Eisuke Kumano
General Editor: Akari Fujimoto
Written and edited by Empathy Capital Team© 2016 AMITA HOLDINGS Co., Ltd. All rights reserved