CSR Report 2019

CSR Report 2019
GLOBAL CSR EYE

Sumitomo Electric Group Executive Conference of Greater China

E d it oria l P o licy

Period Covered by This CSR Report
April 1, 2018 through March 31, 2019 (ﬁscal 2018).
Some activities conducted in ﬁscal 2019 are
alsocovered.

Boundary of This CSR Report
Sumitomo Electric Industries, Ltd. and its consolidated
subsidiaries (357 companies)
In this CSR Report, Sumitomo Electric, the Company
or our company refers to Sumitomo ElectricIndustries, Ltd., Group companies or aﬃliates refers
to the consolidated subsidiaries of Sumitomo Electric,
and the Sumitomo Electric Group or the Group
refers to Sumitomo Electric and its Group companies.
● Whenquantitative information is disclosed,
Sumitomo Riko Company Limited, Nissin ElectricCo., Ltd. and Sumitomo Densetsu Co., Ltd., which
are listed on stock exchanges in Japan, and theirconsolidated companies are excluded. In somecases, Sumitomo Electric alone or only theCompany and limited consolidated subsidiaries orsome of the equity-method companies are included.
The items referenced within such a speciﬁcallylimited boundaries are indicated in the text orfootnotes in the table or graph. CSR promotion
activities conducted by our aﬃliates are introducedin P79 to 80.

● For details of the boundary of data collection forenvironmental indicators, see Explanation of theBoundary in P78.

Guidelines Referenced■ GRI Standard

This report presents information on the standard
disclosures.
The GRI Content Index is published on the following
website:https://global-sei.com/csr/download/■ Environmental Reporting Guidelines 2018 issued

by the Ministry of the Environment of Japan.

Eﬀorts to Improve the Reliability of
the Disclosed Information● To ensure the accuracy and completeness of theperformance indicators, we have engaged an
independent third party to provide assurance onthem, and the indicators subject to the assurancearemarked accordingly. In addition, commentson our initiatives and disclosure from an external
expert in this ﬁeld are published to enhance thecredibility.

Introduction of the Disclosed Media
Other Than This CSR Report
The acquisition of ISO 14001 certiﬁcation and a tableshowing correlation of employee support programswith relevant laws are published on the following
website:https://global-sei.com/csr/download/

Date of Publication
November 2019
(Last CSR Report: published in November 2018; andnext CSR Report: scheduled for release in November
2020)

01 CSR Report 2019

CSR

REPORT

2 019

CONTENTS

03

Basic Value Standards

Business Outline

05

Top Message
Mid-term Management Plan VISION 2022

09

Financial and Non-Financial Highlights

11

Our History and Business13

2018 Highlights

15

Global Business Expansion

17

The 4th Sumitomo Electric Group
Executive Conference of Greater China

21

Corporate Governance23

Risk Management

25

Compliance

27

Respect for Human Rights

28

Relationships with Stakeholders

29

CSR Management

31

Targets and Actual Results in Fiscal 2018 /Targets for Fiscal 2019

Business Outline

07

Basis for Management

Basis for Management

GLOBAL CSR EYECore Category

Social Contribution 33

CSV Activities

37

Automotive

38

Infocommunications

39

Electronics

40

Environment & Energy

41

Industrial Materials

42

New Business Development

43

Social Contribution Activities

Supply Chain

51

Supply Chain

Core Category

Human Resources

55

Diversity

59

Safe and Sound Workplace62

Human Resources Development

65

To Be the Safest Company in the World

67

Environmental Management

71

Activities to Prevent Global Warming

74

Promotion of Resource Conservation and Recycling

75

Reduction of the Release of Harmful Chemical Substances

76

Expansion of Environmentally Conscious Products

77

Initiatives to Address Water Risks

78

Biodiversity / Material Balance

79

Promotion of CSR Activities in Aﬃliates

81

Independent Third Party Assurance Report82

Comments from an External Expert

Environmental
Preservation

Environmental
Preservation

Core Category

Human Resources

Product Quality & Product Safety

Supply Chain

47

Quality

QualitySocial Contribution

R&D GroupCore
Category

36

Core Category

Core Category

Group's CSR Activities

Groupʼs CSR Activities

Governance

Governance

CSR Report 201902

Basic Value Standards
The Sumitomo Spirit
The Sumitomo Spirit grew out of the guiding principles set down in his later years by the founding father of the House of Sumitomo,
Masatomo Sumitomo (1585 - 1652), in Monjuin Shiigaki (the Aphorisms of Monjuin, which describes how a merchant should
conduct his business). The Sumitomo Spirit has been passed down and elaborated through the history of Sumitomo, which mainly
operated copper business. The essence of the Spirit was distilled in the Business Principles codiﬁed in 1891. Also integrated into
the Sumitomo Spirit are other beliefs and principles behind business decisions, and remarks made by Sumitomo managers, whichhave been handed down through generations. The pioneering ideas of the Sumitomo Spirit, which also reﬂect today's concepts ofcompliance and CSR, have been steadfastly inherited as a commonly held asset of Sumitomo Group companies.

Business Principles
Article 1

Article 2

Sumitomo shall achieve prosperity based on solid
foundation by placing prime importance on integrity andsound management in the conduct of its business.

Sumitomo's business interest must always be in harmony
with public interest; Sumitomo shall adapt to good times
and bad times but will not pursue immoral business.

Traditional Beliefs and Principles●

Attaching Importance to Technology

Sumitomo's original copper business centered on the nanban-buki(foreign-style) reﬁning technique, which at the time comprised theleading edge of smelting technology. The business policy of valuing
technology and tackling the development of new technology has
been a driving force in the evolution of Sumitomo business fromthe very beginning.
●

Respect for Human Resources

Sumitomo's history is accentuated with events that demonstrate
the great value that is attached to opinions of those working in theﬁeld. Over the years, Sumitomo has established a corporate culture
in which frank discussions are cherished and human resources are
given the utmost importance. Sumitomo has always considered thatpeople make the enterprise and attached importance to humanresources. This tradition has coexisted with the commitment
among Sumitomo personnel to character cultivation.

●

Long-Range PlanningThis principle is derived from Sumitomo's original experience incopper mine management which requires long-term, continuous
consideration. Business development with a future-looking,long-term view, complemented by a wider perspective to ensure
national and social interests, is one of the factors that have madeSumitomo distinctive.
●

Mutual Prosperity, Respect for the Public GoodThis phrase represents the principle that Sumitomo's businessmust beneﬁt not only Sumitomo but also the nation and society ingeneral, and everyone in Sumitomo is required to focus not only
on making money but always conduct business in harmony withpublic interests. Also demonstrated by its more than century-longeﬀorts to solve environmental problems in the Besshi Copper Mine,
this spirit has always remained unchanged at Sumitomo.

Monjuin Shiigaki (the Aphorisms of Monjuin)
Masatomo Sumitomo was born in 1585 of the late Sengoku Period, in Maruoka,

Echizen (now Maruoka-cho, Sakai-shi, Fukui Prefecture) as the second son of asamurai warrior family, but entered priesthood in Kyoto at the age of 12. His

intelligence led him to be given the name Monjuin, after Monju Buddhist saint who
embodies enlightened wisdom. He later left the priesthood and started his own
business to trade books and medicines, which was the origin of the House of

Sumitomo. Even after he left the priesthood, many people continued to ask for histeachings and respect his faithful instructions. The fact that the founding father was a
widely respected Buddhist priest is the unique feature of the Sumitomo Group. A

letter written by Masatomo Sumitomo (Monjuin) in response to a family member's
request for guidance on conducting business was Monjuin Shiigaki.

Banji-nissei

Figure of Masatomo
Sumitomo (Monjuin)※

Signboard of the
medicine shop operatedby Masatomo※(do your sincere best in not only business but also every aspect of your life)

Consisting of ﬁve articles, Monjuin Shiigaki contains ideas reﬂecting the unstablesocial conditions of Kyoto in the 17th century, when it was written. The preamble
admonishes us to pay attention to any matters including business and workwholeheartedly on everything. This precept “Banji-nissei” has been passed down

continuously, by way of hoping that each one of us in Sumitomo does not focus only
on making money but improves the personality and develops the character. This lofty
document urges us to persist in sincere and careful eﬀort and to cultivate goodcharacter.

The Sumitomo Electric Group positions this “Banji-nissei” as the keyword representing

the Sumitomo Spirit.

Calligraphy work Banji-nissei, which was given by
Chairman Wang Jianyi of Futong Group Co., Ltd.,
China to commemorate the launch of joint ventures※ Collection of Sumitomo Historical Archives

03 CSR Report 2019

Basis for Management

The Sumitomo Electric Group Corporate Principles
On the occasion of Sumitomo Electric's centennial celebration in 1997, the Sumitomo Electric Group deﬁned the Sumitomo
Electric Group Corporate Principles as a new management philosophy arising from the Sumitomo Spirit. The Corporate
Principles underscore our basic policy of commitment to our important stakeholders--our clients, shareholders, society, theBusiness Outline

environment and our employees--and rededicate the Group to the importance of compliance and trust.

Each company of the Sumitomo Electric Group shall●Oﬀer the very best goods and services to satisfy customer needs.

●

Build technical expertise, realize changes and strive for consistent growth.

●●

Maintain high corporate ethics and strive to become a company worthy of society's trust.

●

Nurture a lively corporate culture that enables employee self-improvement.

GovernanceContribute to creating a better society and environment,with a ﬁrm awareness of our social responsibility.

Group's CSR Activities

The Sumitomo Electric Group Charter of Corporate Behavior
To realize a Glorious Excellent Company, which is the ideal state of the Sumitomo Electric Group, we must uphold the Sumitomo
Spirit and the Sumitomo Electric Group Corporate Principles as a basis of all business activities and conduct business with ourstrong will and sincerity in an honest manner. In September 2005, the Sumitomo Electric Group Charter of Corporate Behavior was
created to express the essence of our Group-wide code of conduct in a more straightforward and easy-to-understand manner, so
as to help each and every administrator and employee in the Group make judgments and act to realize the principles presented in
the Sumitomo Spirit and the Sumitomo Electric Group Corporate Principles.

We will aim to provide useful and safe products andservices that will satisfy customers in all aspects
including quality and cost.

2. Development of New andOriginal Businesses and Products
We will aim to develop new, original and proﬁtablebusinesses and products by using our unsurpassed
creativity in meeting customer demands.

●

We will strive for consistent growth of the Sumitomo
Electric Group, by consistently conducting our businesses
with a global perspective and taking full advantage ofthe Group's dynamic business operations.

●

We will contribute to the building of a sustainable
society, taking voluntary and active initiatives to preserve
the global environment.

5. Observance of Laws and Regulations●●●

We will contribute to creating a better society, with a
ﬁrm awareness of our social responsibility as a good
corporate citizen.
We will maintain a strong stand against any force thatthreatens public order and safety.

8. Harmony with the International Community●

As a corporate member of the international community,
we will respect the culture and customs of every regionof the world and contribute to the development of thoseregions.

9. Safe, Sound Workplace and
Employees' Growth and Development●●

We respect the rights of all individuals and will endeavor
to make our workplaces safe, sound and energetic.
We will strive to respect personality and individuality ofthe employees and support their professional
development and career to enable self-realization.

10. Disclosure of Relevant Information andPromotion of Communication with Society●●

We will aim to disclose appropriate corporate
information to our various stakeholders, including
shareholders.
We will also promote good communication with society
through public information and hearings.

CSR Report 2019

Environmental
Preservation

We will observe national and international laws andregulations and always act fairly and openly.

7. Conduct as a Member of Society

Human Resources

4. Contribution to Preservation of
the Global Environment

We will promote fair, transparent and free competitionand sound trade.

Supply Chain

3. Growth and Development of
the Sumitomo Electric Group throughGlobal Business Activities●

Quality●

6. Fair and Proper Business Activities

Social Contribution●

Core
Category

1. Provision of Useful and
Safe Products and Services04

To p M e s s a ge

With the concerted eﬀorts of the entire group,
we will work to make society"environmentally friendly," "safe and secure," and"comfortable with much potential for growth."
Osamu Inoue

President & COO Sumitomo Electric Industries, Ltd.

Preface

The business environment surrounding the Sumitomo

I sincerely express my gratitude for your continued support

However, a decrease in car production in China andand understanding of Sumitomo Electric Group's businessactivities. I also thank you for reading this CSR Report
2019.
During the period covered by this report, while theJapanese economy remained strong in the first half withsupport from domestic demand mainly due to thefavorable employment situation and capital investment, theeconomic slowdown in China and Europe led to decreases
in exports and production in the second half. In the global
economy, US-China trade conflict and uncertainty in theeconomic outlook have led to a decline in consumption
and investment in China, affecting other economies andleading to a gradual slowdown in their economic growth.

05 CSR Report 2019

Electric Group remained mostly stable in the first half.
Europe began to be remarkable in the second half of 2018
and the circumstances for our group became increasingly
severe, which was also attributed to sluggish sales ofsmartphones on a global scale and a decline in demand for
cemented carbide tools in some markets. In particular, thesigns of protectionism including the US-China trade conflicthas started to affect the value chain we have establishedand it is necessary to carefully determine the degree.
Under these circumstances, our consolidated results forfiscal 2018 recorded a revenue increase with net sales of
3,178.0 billion yen, a year-on-year increase of 3.1%. On theother hand, operating income dropped by 4.0%
year-on-year to 166.3 billion yen.

Making the Sumitomo Spirit and the Sumitomo ElectricGroup Corporate Principles the basis of our businessactivities, our group is committed to taking "SEQCDD＊" onestep further. In addition, to become a "Glorious Excellent"VISION 2022," which was launched under the concept of"Contributing to a better society by leveraging our
expertise in connectivity and transmission technologies
through concerted efforts of the entire group" in fiscal
2018. To achieve the goal, we set the three priority
initiatives of "Enhancement of Manufacturing Capabilities,"
Enhancement of Leading Technology."
Some of the topics during fiscal 2018 are as follows. Firstly,
for the enhancement of manufacturing capabilities, we
focused on the creation of even stronger factories, which
also underlie our manufacturing capabilities. Each division
promoted a wide range of activities for it with the IoT R&D
involved in those activities, playing a pivotal role. Throughclose coordination with the plants in our group, as well as
Plant & Production Systems Engineering Division, thedivisions worked for productivity improvement, automatedinspection, predictive maintenance, work safety and otherissues using AI and promoted the improvement of theireffects. Secondly, for increasing global presence, we took
measures to strengthen our foundation on a global scale
automotive parts business and the expansion of investmentin the wiring harness business in Southeast Asia. Lastly, forthe creation and enhancement of leading technology, we
took flexible measures to promote the new combination oftechnologies, such as an organizational reform that
Business Unit and Infocommunications Business Unit, in
consideration of the major changes that will lead to theincreasingly grow in the future. To meet demand forrectangular wires used in vehicles that help reduce the sizeof motors and increase their output, we established a baseto manufacturer them in Jiangsu Province, China in March
2019 and plan to start its full-scale operation in 2022.
In the environment and energy field, we received an orderfor power transmission and transformation equipment andits installation work for Wind Farm Tsugaru, Japan's largest
onshore wind farm, last year. In recent years, large-scale
projects for renewable energy have increased. To respondto demand for large-capacity and long-distance powertransmission, this project aims to start the operation of theequipment in April 2020 by using the collective strength of
our group, including Nissin Electric Co., Ltd. and Sumitomo
Densetsu Co., Ltd., to undertake the design, manufacturing
and installation of electrical equipment in a comprehensive
manner. In related moves, we have been committed tohigh-voltage DC cable projects that help curb global
warming, one of the major challenges for the conservationof the global environment; we completed the work for the
250-kV DC XLPE cable system of the Hokuto-Imabetsu DC
Trunk Power Line, which was an order from Hokkaido
Electric Power Co., Inc., in March 2019, as well as a 400-kV
DC XLPE cable system connecting the UK and Belgium in
May 2019.
In the meantime, demand for water treatment products
has been increasing in China and we are promoting theestablishment of a system to increase the production of
POREFLON membrane, which contributes to theprevention of water pollution. We also focus on thecommercialization of other products including thoserelated to the next-generation communications networkthat can meet social demand for high-speed andlarge-capacity communications.

Qualityremoves the conventional border between Automotivethat demand for drive motors mounted in them will

Social Contribution

including the acquisition of a European manufacturer in thethe more widespread use of electric vehicles, it is expected

Core
Category

respective production fields, which has produced actual

by about 10 billion yen from fiscal 2017. In particular, withGroup's CSR Activities

Center, which has been set up as an organization to be

the budget for research and development for the businessGovernance"Increasing Global Presence" and "Creation andrespond quickly and flexibly to the changes, we increased

Business Outline

Company," we announced mid-term management plan

revolutionary period with the development of CASE＊. To

Basis for Management

Priority initiatives forthe realization of VISON 2022

connection of vehicles with traffic communications andenergy infrastructure.

The businesses of the Sumitomo Electric Group are

Supply Chain

Creation of new businesses inour business fields

The Sumitomo Spirit andthe Sumitomo Electric Group
Corporate Principles,
which relates to SDGs
Positioning the Sumitomo Spirit and the Sumitomo Electric

In consideration of social challenges beyond our customers

Group Corporate Principles as its key management value,("to-B"), we have worked to solve them together with thethe Group has been committed to the creation andcustomers, continuously provided new products andexpansion of businesses as well as CSR activities. We

consider that these activities are also related to the SDGs＊

The global environment and social system are affected byadopted by the UN in 2015. For the achievement ofvarious new risks. Our group will be continuously"environmentally friendly society," "safe and secure society"committed to the creation of new businesses and newand "comfortable society with growth potential," which areproducts that are original and profitable, meet social

targets for the mid-term management plan VISION 2022,

demand and expectation and help solve social challenges.

we will continuously make concerted efforts to provide

The automobile-related business has entered avarious values.

Glossary ＊SEQCDD

An acronym for Safety, Environment,
Quality, Cost, Delivery and Research &Development＊CASE

A term for the trends in the automotive
industry; an acronym for Connected,
Autonomous, Shared and Electric

Environmental
Preservation

services to society and achieved growth and development.

Human Resourcesclassified into the category of the so-called B-to-B business.

＊SDGs（Sustainable Development Goals）

An acronym for Sustainable Development Goals, which are composedof 17 goals and 169 targets presented by the UN along withlong-term development guidelines for the period from 2015 to 2030

CSR Report 201906

Mid-term Management Plan VISION 2022
Basic Concepts

Contributing to a better society by leveraging our expertise in connectivity andtransmission technologies through concerted efforts of the entire group.
Overall Concept Diagram
A Glorious Excellent Company is Sumitomo Electric Groupʼs ideal future state.
Positioning the Sumitomo Spirit and the Sumitomo Electric Group Corporate Principles as our basic management value, wewill help create a better society through business activities.
In our growth strategy, we aim to diversify our technologies and products and create innovations that meet new social
demand in the fields of Automotive, Infocommunications, Electronics, Environment & Energy and Industrial Materials basedon the Manufacturing Base, Human Resources and Organizational Base and Financial Base we have developed, and will becommitted to enhancement of manufacturing capabilities, increasing global presence and creation and enhancement ofleading technology.

VISION 2022

Glorious
ExcellentCompany

Net Sales¥

Sumitomo Electric Group’s Ideal Future State

Operating Income

ROIC

ROE

3,600 billion ¥230 billion 9 % or more 8 % or more

Communications

EnergyMobilityosolutis, and, product
A diversity of materials

s
ain
dom
ese
h
t
rt
ppo
ns su

Innovation Through Concerted Effort
Increasing
Global Presence
Enhancementof Manufacturing
Capabilities

Creation and Enhancementof Leading Technology

Automotive

Infocommunications

Industrial Materials

Man
ufac
turin
g Ba
se

Environment & Energy

Electronics

Human Resources and Organizational Base

e
l Bas
ncia
Fina

Corporate Social Responsibility (CSR)
The Sumitomo Sprit andthe Sumitomo Electric Group Corporate Principles

Growth Strategy

Enhancement and Expansion of Five Business Segments
The Sumitomo Electric Group continues to strive for growth in five business segments focusing on Mobility, Energy andCommunications fields as well as materials, products and solutions supporting these fields. We aim to grow every segment
by strengthening revenue bases and improving capital efficiency and to achieve a balanced business portfolio.

Further Growth Through Innovation
As exemplified by major innovation in the automobile industry, widespread use of renewable energy and effective use of big
data, the markets surrounding the Sumitomo Electric Group are undergoing dramatic changes. While new social demand iscreated and new markets are growing, we will create innovation in a holistic approach based on the diversity in technologies
and business expertise we have cultivated over the years, offering new technologies, products and services that help
facilitate the realization of a better society.

07 CSR Report 2019

Basis for Management

Targets
FY2020 Interim Target

FY2022 Target¥3,600 billion¥200 billion¥230 billion

5.9%

6.4%

ROIC

8.5% or more

9% or more

ROE

8% or more

8% or more

Operating Income
Operating Margin Ratio¥950 billion

R&D expenditures¥600 billion(5-year cumulative amount)

GovernanceCapital investment (5-year cumulative amount)

Business Outline¥3,400 billion

Net Sales■ We aim for a new-product sales ratio of 30%.
Group's CSR Activities■ We aim to keep our shareholders' equity ratio at 50%.
■ We aim to maintain a stable dividend for shareholders and increase the dividend payout ratio toabout 40% by the fiscal year 2022.

Industrial
Materials

Portfoliopresented in the graph on the right.

Environment &Energymore than 50% of the entire portfolio while ensuring a growth in total profit level.

Automotive

45%

20%

Electronics

10%

Social Contribution

We aim to grow the non-automotive segments at a higher rate so that they result inCore
Category

15%

Our target business portfolio in operating income to be achieved by fiscal 2022 is

Infocommunications

10%

Quality

Our Priorities
Taking SEQCDD one step further●●

Aim for the world s top safety company
Create strong factories through continuous improvement (kaizen)

Supply Chain

Enhancement of
Manufacturing
Capabilities● Exert our strength by sharing and propagating technologies and bestpractices among Group companies worldwide

Work to increase market share with global customers●

Create new business models that anticipate market changes●

Enhance the efficacy of our marketing efforts●

Continue to enhance core technologies from materials to processes●●

Innovation that anticipates change in the automotive and energy fields and exploitscommercialization opportunities with agility
Challenge ourselves to create innovative technology that encourages social reform

CSR Report 2019

Environmental
Preservation

Creation andEnhancement of
Leading Technology●

Human Resources

Increasing
Global Presence08

Financial and Non-Financial Highlights

F i n ancia l O verview
Sales in Japan and overseas and ratio of overseas sales by year

Operating Income and Proﬁt Attributable to
Owners of the Parent (Consolidated)

Ratio of overseas sales (%)(100 million yen)

30,00025,00020,00015,000

59.5

58.3

55.2

35,00025,68814,17028,22859.7

58.8

29,331

28,145

58.5

60
55

30,822 31,780

50

16,46817,461

16,537

18,38818,583

1,731

1,600
1,400
1,200

1,435

1,201

1,345
1,198

1,000

910

800

1,505
1,076

1,663

1,203

1,181

667

600

10,0005,000(100 million yen)

1,800

400

11,518

11,76011,87011,60812,434

13,197

2013

2014

2015

2016

2017

2018

200
0

0

Overseas

Ｉn Japan

2013(Fiscal year)

2014

Operating Income

Ratio of Overseas

2015

2016

2017

2018

(Fiscal year)

Proﬁt Attributable to Owners of the Parent※Sumitomo Electric and consolidated subsidiaries

Return on Equity (ROE) and Return on Invested Capital (ROIC)＊

Total Assets and Net Assets (Consolidated)(100 million yen)

35,00029,25830,00025,00025,54827,42829,07329,99930,533

（％）
10

9.1

8

20,00015,00013,79916,46915,613

16,286

17,641

17,763

10,000

6.6

6.5

6

6.5

5.9

4

6.8

7.7
7.2

8.1
7.9

7.6
7.3

5,000
2

0

2013

Total Assets

2014

2015

2016

2017

2018

(Fiscal year)

Net Assets

0

2013

(Note) We have adopted Partial Amendments to Accounting Standard for Tax Eﬀect
Accounting (Accounting Standards Board of Japan Statement No. 28, February 16,2018), etc. since the beginning of FY2018; therefore, with respect to FY2017, we haveretrospectively adopted the Amendments to Accounting Standard, etc. on those ﬁgures.

Capital investment(100 million yen)

1,508

1,482

1,673

1,837

2017

1,152

1,177

2016

2017

2018

(Fiscal year)

ROIC

1,711

1,300

1,903

1,200
1,000

1,200

995

1,056

1,108

1,296

800

1,000

600

800
600

400

400

200

200
0

0

2013

2014

2015

2016

2017

2018

(Fiscal year)

2013

2014

Glossary ＊ROIC：Return on Invested Capital

09 CSR Report 20192016(100 million yen)

1,800
1,400

2015

R&D expenditures

2,000
1,600

ROE

2014

2015

2018

(Fiscal year)

Operating Proﬁt / Invested Assets =Operating Proﬁt/(Total Assets−Interest-Free Liabilities)

Basis for Management

N o n - fina ncia l O verview
Number and share of women in
section managers or higher positions

as of January 16 ofeach ﬁscal year

Ratio of overseas employees (%)(Persons)

83.3

300,000
250,000

83.8

225,484

84.2

84.0

240,798 240,865 248,330

84.5
255,133

85.3
272,796

85
83
81
80

187,76930

1738,53739,236

39,63740,231

2013

2014

2015

2016

2017

2018

Overseas

Ｉn Japan

2013

2017

2.4

Employment rate as ofJune 15 of each year

2.29

2.2
2.1

2.17

2.11

2.17

2.21
Legally required
percentage

2.0

0

0

2013

2014

2015

2016

2017

2018

2014

(Year)

Lost Time Injuries Frequency Rate＊for Employees in Japan by Year

2016

2017

0.94

Greenhouse Gas Emissions and Reduction Ratio(in Japan and overseas)

1.61

1.06

1.06

1.63
1.15

1.66
1.02

1.20

1,600
1,400

0.14

0.11

0.13

0.11

0

0

0.07

0.07

0

0

2013

2014

2015

2016

2017

2018 (Fiscal year)

All industries
Manufacturing industry
Sumitomo Electric Group
Sumitomo Wiring Systems, Ltd. (SWS)

800

1,497

1,575

1,541

681

711

700

732

848

833

761

744

730

764

727

708

600
400
200

0

2013
ResultIn Japan2014
ResultOverseas

2015
Result2016
Result

2017
Base

2018
Result(Fiscal year)

Reduction ratio(Note) See Notes 1-4 of the graph of Greenhouse Gas Emissions and Reduction Ratio(in Japan and overseas) in P71.

Environmental
Preservation(Note) The lost time injuries frequency rate for employees in Japan in the Sumitomo ElectricGroup covers Sumitomo Electric and its 41 aﬃliates in Japan (excluding SWS and theother listed companies), and the frequency rate in SWS covers SWS.

1,000

1,430

Human Resources

0.19

0.03

0
1
2
3

2.2
1,456

1,442

Reduction ratio (%)

0

Emissions converted toCO2 equivalent(thousand tons-CO2e/year)

1,200

0.5
0

1.66

(Year)

Supply Chain

1

1.58

1.83

2019

(Note) Total for Sumitomo Electric and its qualiﬁed Group companies including
Sumiden Friend, Ltd.

（Frequency rate）

2

2018

Quality(Note) Average of the total working hours in each year from January to December of
each of the Sumitomo Electric employees (including those on loan to
Sumitomo Electric aﬃliates and other organizations within the Works)

2015

Social Contribution

1,988

2.29

Core
Category

2,024

1,950

1.5

(Fiscal year)

No. of general managers or higher positions

2.3

1,999

15
2018

Group's CSR Activities

（％）

2,000

12

10
2016

Employment Rate of the Physically or
Mentally Disabled by Year

2,100

2,047

10
2015

38

34

30

(Note) Above graphs cover personnel data for Sumitomo Electric employees,
including those on loan to Sumitomo Electric aﬃliates and other organizations.

(Hours)

2,042

28

1.0

Share in section managers or higher positions

Ratio of Overseas

Average Total Working Hours by Year

2,042

2014

No. of section managers(Fiscal year)※Sumitomo Electric and consolidated subsidiaries

2,050

10

8

0

22

53

46

40

38

32

25

10

38,892

1.2

50

20

37,715

1.4

1.0

40

201,906 202,328 209,094 215,496 232,565

50,000060

1.6

Governance

150,000(Persons)

1.8

1.5

1.4

1.3

（％）
2.0

1.9

1.7

84
82

200,000

100,000

86

Business Outline

Number of employees in Japan and overseas andratio of overseas employees by year

Glossary ＊Frequency rate

Number of deaths and injuries caused by industrial accidents per million working hours. Used to express accident frequency.
The formula is: Number of deaths and injuries caused by industrial accidents / Total working hours x 1,000,000.

CSR Report 201910

Our History and BusinessStarting with copper wire production, the electric wire and cable business of Sumitomo Electric has expanded in the respective segments,
including the manufacturing of power cables and communication cables and then magnet wires, automotive wiring harnesses and electronic
wires for information equipment, in line with the development of society. In the meantime, we also began to diversify our business in earlyyears based on the technology to produce electric wires and cables. The production of cemented carbide tools and special steel wires
launched in 1931 and 1932 respectively was a firm step into the areas outside the electric wire segment. We have accelerated thediversification with the target of increasing the ratio of the non-electric wire business to 50% since the 1960s, and offeredinnovative products and technologies such as compound semiconductors, optical fibers, artificial diamonds andhigh-temperature superconductivity in sequence so as to support the changing times. The Sumitomo
Electric Group has thus continued to develop unique technologies and persistently
pursued new business opportunities, and is now conducting global business
operations in the following five major business segments:
automotive; electronics; environment & energy;
infocommunications; and industrial materials.

History

1897

Sumitomo Copper Rolling Works was founded.

1943

Started production of anti-vibration rubber and fuel tanks.

1900

Started production of coated wires.

1946

Opened a branch oﬃce in Tokyo (now the Tokyo Head Oﬃce).

1908

Started production of power cables.

1948

Started marketing sintered powder metal products.

1909

Started trial production of telecommunication cables.

1949

Entered into the business of construction of overhead transmission lines.

1911

Established Sumitomo Electric Wire & Cable Works(the foundation of the Company).

1957

Delivered the ﬁrst Japan-made television broadcasting antennas.

1961

Opened the Yokohama Works.

1962

Started production of IRRAXTM Tube electron beam irradiation tubes.

Manufactured and supplied the ﬁrst Japan-madeunderground high-voltage (11,000 V) cables.
1916

The Head Oﬃce was moved from Osaka's Konohana Ward to
the present address in Chuo Ward.

Started production of enamel wires.
1920

11 CSR Report 2019

Opened a new factory (now the Osaka Works)

Delivered the wiring harnesses for four-wheel vehicles for the ﬁrst time in its history.

Incorporated Sumitomo Electric Wire & Cable Works asa limited company (the establishment of the Company).

1931

Started production of cemented carbide ( IGETALLOY ) tools.

1932

Started production of special steel wires.

1939

Company name changed to the current name,
Sumitomo Electric Industries, Ltd.

1941

Opened the Itami Works.

1963

Started production of disc brakes.

1964

Started production of electron beam irradiation wires.

1968

Entered into the business of traﬃc control systems.

1969

Established its ﬁrst overseas production subsidiary.

1970

Started production of compound semiconductors.

Started development of ﬂexible printed circuits (FPCs).

Automotive
Basis for Management

Contributing to accelerating improvement delivered by
CASE and to the evolution of mobility

Business Outline

Our main automotive products are wiring harnesses, which are laid throughout an automobile to transmit power and information. Wiring harnesses
require advanced technologies to reliably transmit electricity and information to electrically-driven components and control equipment in theautomobile despite intense vibration and heat. In the Sumitomo Electric Group, Sumitomo Wiring Systems, Ltd. and AutoNetworks Technologies, Ltd.
have established such a prominent presence in the market that one out of four automobiles in the world uses Sumitomo Electric's wiring harnesses.
Steady advances in the use of aluminum wiring harnesses have been helping reduce automobile weight. Our connecting technologies are essential for
realizing connected cars and autonomous driving, which must handle a huge amount of information, as well as for achieving widespread use of hybrid
and electric vehicles. We intend to become a mega-supplier with the wiring harness business at the core for an excellent harmony between
automobiles, people and society in the next generation.

Electronics
Supporting further evolution of mobile devices,automobiles and aviation equipment

GovernanceThe diverse range of raw, wiring and other materials supplied by our group have supported the evolution of various electronic equipment at the core.
Flexible printed circuits (FPCs) are one of the main products of the Group. Their versatility in forming high-density circuits in a small area makes thema wiring material adaptable to all kinds of increasingly complex equipment. We have electron beam irradiation technology used to produce electric
wire products and heat-shrinkable tube, and fluorine resin processing technology applied to printer toner fixing rollers. In addition to these proprietary
material development, design and processing technologies, we are experts in high-speed data transmission technology, constantly creating products
to meet demand for sophisticated functionality. We aim to become a global supplier of high-performance cables, components and materials byrefining these technologies and strengthening our supply chain to be successful in global competition.

Environment & Energy

Group's CSR Activities

Building next-generation energy systems forthe widespread use of renewable energy and other purposes
We melt, solidify and roll copper. Sumitomo Electric's electric wire and cable products evolved from its copper wire production since its foundation.
With a solid foundation and proven track record of achievements among Japan's top-tier businesses in the category of low to ultra-high voltage
electric wire and cable products, we support energy infrastructure throughout Japan. Currently, the technical expertise of our group is required for theconstruction of new energy systems in line with trends such as international grid interconnection projects, primarily in Europe, infrastructuredevelopment in emerging countries, increasing use of renewable energy and widespread use of electric vehicles. We aim to build a stronger global
presence drawing on our strengths such as diverse high-value product families and associated services, project-planning expertise, overall capabilities
involving affiliate companies in the heavy electrical machinery and engineering fields and end-to-end system development from raw material tofinished product.

Core
Category

Infocommunications
Endeavoring to realize high-speed, high-capacity telecommunications meetingthe challenge of the increasing data traﬃc volume

Quality

Industrial Materials

Social Contribution

Communication infrastructure is essential for society. Optical fiber cables and other components and equipment that support communications, suppliedby the Sumitomo Electric Group, play an active role in communication infrastructure. We began manufacturing optical fiber products in the 1970s. Amongthem, those for over 10,000 km ultra-long distance submarine systems are required to exhibit high quality and high reliability. We have built a presencein the industry with our high technical expertise as represented by the Z fiber, which is an optical fiber developed for ultra-long distance submarine
system applications. The Z fiber broke the world record for low-loss optical fiber. Our strengths also extend to Ultra-High-Fiber-Count Optical Cable
manufacturing technology and software development for visual- and optical-access devices. Increasing volumes of information are currently exchanged
throughout the world. With our technologies playing a key role in important connections, we will lead the age of high-speed, high-capacity
telecommunications by working on developing innovative new products that are one step ahead of and exceed various customer expectations, such ascompound semiconductors for optical/wireless applications developed via collaborative vertical integration from raw materials to finished devices.

Contributing to the growth of industries and social infrastructure bydeveloping and supplying high-functionality materials

Opened the Kanto Works.

1974

Started production of optical ﬁber cables.

2003

Sumiden Hitachi Cable Ltd.
(wires and cables for buildings and industrial equipment) started operation.
Sumitomo Electric Hardmetal Corp.
(powder metal and diamond products) started operation.

2004

A.L.M.T. Corp. was made a wholly-owned subsidiary.

2006

The HTS cable used in a power transmission grid in the U.S. started supplying electricity.

2007

Sumitomo Wiring Systems, Ltd. was made a wholly-owned subsidiary.

1975

Contracted to construct a power transmission line in Iran.

1976

Received an order for a large telecommunications network project in Nigeria.

1978

Delivered and put into operation the world's ﬁrst bi-directional ﬁber
optic CATV system Hi-OVIS.

1981

Delivered the ﬁber optic LAN system for the ﬁrst time in its history.

1982

Succeeded in producing the world's largest synthetic
monocrystalline diamonds (1.2 carats).

2008

Opened the Technical Training Center.

1996

Developed a technology for producing long-length oxide
high-temperature superconducting wires.

2009

Sumitomo Electric Device Innovations, Inc. was organized.

2010

Opened the WinD Lab, a new laboratory building.

2014

J-Power Systems Corporation was made a wholly-owned subsidiary.

2015

Started a demonstration test of the world's-largest-class redox ﬂow battery system.

Developed and started marketing ecology wires and cables.

1999

Sumitomo Electric Fine Polymer, Inc. (ﬁne polymer products) started operation.

2001

J-Power Systems Corporation (high-voltage power cables) started operation.

2002

Sumitomo Electric Networks, Inc. (network equipment) started operation.
Sumitomo (SEI) Steel Wire, Corp. (special metal wires) started operation.
Sumitomo Electric Wintec, Inc. (magnet wires) started operation.

Environmental
Preservation

1998

Nissin Electric Co., Ltd. was made a consolidated subsidiary.

Human Resources

1971

Supply Chain

Materials produced by the Sumitomo Electric Group have evolved on the basis of its thin copper wire-making technology. Our cutting and grinding
tools made of materials such as diamond, cubic boron nitride and cemented carbide alloys support all fields of manufacturing throughout the world.
Additionally, special steel wires that reinforce concrete structures and tires and sintered powder metal parts used primarily in automobiles are
essential for the growth of society and industries. In response to the growing demand for lightweight automotive materials and the growth in the
medical and aviation industries, we will offer tangible forms of innovative solutions for customer and social challenges, drawing on our world-classmaterials development capabilities and production technologies.

Sumiden Friend, Ltd. (Special subsidiary) started operation.

SEI Optifrontier Co., Ltd. was organized.

CSR Report 201912

2018 Highlights

Major events during ﬁscal 2018 are listed below.

2018

5

●

Enter into a contract for a high-voltage underground cables project in Phnom Penh,
the Kingdom of Cambodia
Cambodia

Thailand

Laos

Cable routes ofthe project

GS1
Substation

Route 12.18kmSiem Reap
MekongRiver

Phnom Penh

Vietnam
Route 43.4km

Gulf ofThailandSouth China
Sea

6
9
12

●

●

Substation in
EDC

Route 23.37kmSubstation in
the Olympic Stadium

NCC Substation

PalaceSubstation in
Hun Sen Park

Route 33.28kmReleased "Q'z TAG™ walk plus", a new model that enables
automatic measurement of TUG＊

POWER DEPO™Ⅲ, a lithium-ion energy storage system fordomestic use was registered as a model to receivea subsidy of FY2018 ZEH＊ support project
POWER DEPO™Ⅲ●●

Successfully developed next-generation SiC transistors withthe world's lowest on-state resistance jointly with
the National Institute of Advanced Industrial Science and Technology
Initiated the operation of Redox flow batteries in the US wholesale power market(Demonstration project of New Energy and Industrial Technology Development Organization)

2019

2

●

Won an Excellence Award in the Environmental Reporting
Category of the 22st Environmental Communication Awards

Glossary ＊TUG

13 CSR Report 2019

An acronym of "Timed Up and Go," which
is a test to assess mobility function＊ZEH (net zero energy house)

A house that aims to make the balance of annual primary energy consumption "zero" by reducing
energy use while also generating energy through photovoltaic power generation, etc.

●Founded a manufacturing company toproduce rectangular magnet wires usedin vehicles in Jiangsu Province, China

Governance●●Selected as an FY2018 Nadeshiko Brand●

Received the highest environmental rating from the Development Bank of Japan●

Started to supply BS4K set-top box●

Core
Category

BS4K set-top box "Cable Plus™ STB-2"

Group's CSR Activities

5

Business Outline

Receipt of the certiﬁcate of appreciation

3

4

Received a certificate ofappreciation from Mongolia's
National Power Transmission
Grid for our contribution to
the reduction of CO2 emissions
by supplying low-loss conductor
to the country

Basis for Management

2

Social Contribution

Acquired two Group companies of Sinterwerke,a powdered metal component manufacturer in Europe

Group Global Award Ceremony

Supply Chain
Human Resources
Environmental
Preservation

CSR Report 2019

Quality

On August 2, 2018, the Sumitomo Electric Group Global Award Ceremony was held at Nakanoshima, Osaka.
The Group Global Award program intends to commend activities and groups in recognition of their signiﬁcant
contributions to achieving the target of becoming a Glorious Excellent Company. An international ceremony is held for theawards every ﬁve years. In the ceremony in 2018, which was attended by 450 people from Sumitomo Electric and its
Group companies in Japan andoverseas, a total of 106 teams
and companies were commended
and three teams among thempresented their achievements
as representatives of the award
winners.
The event helped us share ourvision, business policies, etc. torealize VISION 2022 and develop
a sense of unity towards therealization across the Group on a
global scale.
As one of the 120th anniversarycommemorative programs, Small
Group Activity Convention was
also held on the same day (seeP64 for the Small Group Activity
Convention).

14

Global Business Expansion
The Sumitomo Electric Group is developing business activities on a global scale, with 390 consolidated companies andover 270,000 employees around the world. While providing superior products and services, we respect the cultures andcustoms of the countries and regions in which we operate. As a corporate entity we conduct business in harmony withsociety, so as to contribute to the sustainable development of the economy and society.

Asia

EUROPE

56

166

GlobalNetwork
North/SouthAmericaJAPAN

105
Oceania & Middle East& Africa

15

390

(as of March 31, 2019)●

Company Name

Sumitomo Electric Industries, Ltd.

Established

April 1897

Incorporated

December 1920

Capital Stock
Head Oﬃce

Osamu Inoue
99,737 million yen (as of March 31, 2019)4-5-33, Kitahama, Chuo-ku, Osaka, JAPANNet Sales by Region (Consolidated)

Europe and others 3,501

Asia 9,590

Total forFiscal 2018

31,780(100 million yen)

America 5,491

15 CSR Report 2019

in total

Breakdown ofcompanies consolidated●

President

48

Companies
Consolidated

Japan 13,197

Consolidated subsidiaries (357)
Equity-method companies (33)

Number of consolidated companies by country or area
EUROPE

North/South America

JAPAN

105

USA

27

Argentina

1

Canada2

7

Paraguay

1

Indonesia

12

Brazil7

2

Cambodia1

Mexico10

Serbia1

Singapore4

Czech Republic

1

Thailand

23

Germany

12

Philippines

11

Oceania &Middle East & Africa

Turkey4Vietnam

10

Egypt

2

Hungary

3

Malaysia

5

Australia

2

France4South Korea

7

Saudi Arabia 1

Bulgaria

1

China

75

Tunisia4

Belgium

1

Hong Kong

5

Morocco4

Poland4

Taiwan6South Africa

2Mordova

1

Romania

3

Russia

5

UK

7

Italy

2

Japan

Ukraine1

Asia

Netherlands

3

India

Spain

1

Slovakiasingle company. A total of 300 Japanese staff and 2,000

Sumitomo Electric started to export electric wires, which

In the two power transmission line construction projects for

Basis for Management

History of the business development
on a global scale

locals worked together on the project for 11 and a half years

underlie the industry, during the era of its forerunner,

Sumitomo Electric Wire & Cable Works, which was founded

in 1911. In the postwar period, we expanded our business byelectric wire products and all services from design toconstruction. This leads to the establishment of foundations
for the social and economic development of developing

which we received orders in Iran in 1975 and 1977, we faced
not only harsh geographical and weather conditions in theconstruction area but also unstable political circumstancessuch as revolution and war. Still, we managed to connect

Business Outline

exporting full turnkey projects, which covered exports ofuntil its completion in 1988.

major industrial bases of the country and eventuallycomplete the projects in 1987.

countries and regions all over the world.

With respect to products in the business segments as well,

we have promoted localization of the business by setting up a

number of production bases in the trend of customer demand
Governancefor overseas operation and so on. Through these activities, wehave provided technical guidance and have established an
integrated system of production and sales outside Japan.

Full turnkey projects
Since our first project in Venezuela in 1963, we have

Global development by business segment
Beginning with the foundation of our first overseas

serve as an

the establishment of overseas bases in consideration ofand South America to lay power transmission lines, whicharterythat conveys electricity throughout

society, and to build communication networks, which serve
as a nerve system that conveys information.

In particular, the order we received to construct an urban

telephone network in Nigeria in 1974 was at that time an

unprecedentedly large communication network construction(Persons)
300,000
250,000

83.8

83.3
225,484

84.5

84.2

84.0

85.3

255,133
240,798 240,865 248,330

86
85
84

272,796

83
82
81
80

150,000
100,000

187,769

201,906

202,328

209,094

215,496

232,565bases, we are committed to job creation and humanresource development while aiming to stabilize the local
operation. We now have a total of 285 overseas
consolidated companies with more than 230,000 employees.

Sales in Japan and overseas andratio of overseas sales by year
(100 million yen)

30,00025,000

59.5

58.3

55.2

35,00025,68828,22820,00015,00029,331

Ratio of overseas sales (%)

58.8

28,14559.7

58.5

30,822

31,78018,38818,58360
55
50

16,46817,461

16,537

11,518

11,76011,87011,60812,434

13,197

2013

2014

2015

2016

2017

2018 (Fiscal year)

14,17010,00050,0000

In the parts of the world in which we have established our

Quality

200,000

market characteristics and needs for each business segment.

Social Contribution

Number of employees in Japan and overseas andratio of overseas employees by year
Ratio of overseas employees (%)

manufacturing base in Thailand in 1969, we have promoted

Core
Category

project, even by worldwide standards, to be placed with aGroup's CSR Activities

undertaken construction works in Asia, Middle East, Africa

5,000

37,71538,53739,236

39,63740,231

2014

2015

2016

2017

2018

Ｉn Japan0(Fiscal year)

Overseas

Ratio of Overseas

Ｉn Japan※Sumitomo Electric and consolidated subsidiaries

Ratio of Overseas※Sumitomo Electric and consolidated subsidiaries

Supply Chain

2013

Overseas

38,892

Number of Group Employees in the World by Year
2010

2011

2012

2013

2014

2015

Americas13,852

15,164

19,712

24,27329,47034,828

2016

2017

2018

Male

Female

Total

Male

Female

Total

Male

FemaleTotal

33,50022,481

15,47837,95920,381

18,542

38,923

20,52320,00840,531

33,834

41,23047,73547,64454,24556,47756,273

22,13534,662

56,79724,09736,44060,537

24,73341,01465,74734,31037,53843,00049,86856,40858,27861,84821,44044,404

65,84425,00946,52071,52928,46650,77979,245

China

37,84351,887

46,78847,39047,64652,32350,707

20,19628,29848,494

19,716

24,79144,50722,85324,18947,042

Japan

37,36436,95437,49937,14837,71538,892

38,537

31,915

7,321

39,23632,201

7,436

39,63732,488

7,743

40,231

Total

157,203 182,773 194,734 206,323 225,484 240,798 240,865 118,167 130,163 248,330 121,404 133,729 255,133 129,063 143,733 272,796

Ratio ofoverseas employees

76.2%

79.8%

80.7%

82.0%

83.3%

83.8%

84.0%

84.2%

84.5%

85.3%

※Sumitomo Electric and consolidated subsidiaries

CSR Report 2019

Environmental
Preservation

Europe/Africa
Southeast Asia

Human Resources

2009

16

GLOBAL CSR EYE
The 4thSumitomo Electric Group
Executive Conference ofGreater China

Executive Talent Developmentin Greater China
The Sumitomo Electric Group holds theRegional Executive Conferences in theAmericas, Europe, Southeast Asia/Australia andGreater China every year. This report presents
the 4th Sumitomo Electric Group Executive
Conference of Greater China held in Tianjin in
December 2018.
Date
Venue

December 17, 2018 (Mon.)The Ritz-Carlton, Tianjin

Schedule■ President speech■ Reports on the executive talent development inGreater China and Area Committee activities■ Reports on Area Committee activities

Reports from ﬁve committees on PR and other subjects■ Final reports on the Action Learning program

Reports from ﬁve teams on the Sumitomo Spirit,
CSR in Greater China and other subjects■ Reports from the Corporate Staﬀ Group of Sumitomo Electric

Reports from seven divisions including the Corporate Planning Department■ Comments from the management of Sumitomo Electric■ Social gathering

Tianjin, China
17 CSR Report 2019

Basis for Management

The 4th Sumitomo Electric Group Executive Conference ofGreater China received 168 persons from 52 companies
At the conference held in Tianjin, China in
December 2018, executives and other personnelof the Sumitomo Electric Group companies in

Business Outline

Greater China gathered to report the recent
situation of each company and make reports on
Area Committee activities as well as final reportson the Action Learning program. In addition, theCorporate Staff Group of Sumitomo Electricreported on VISION 2022 and other subjects.
From Japan, President Osamu Inoue, Executive

Governance

Vice President Mitsuo Nishida and Senior
Managing Director Yoshitomo Kasui also
participated in the conference, which was very
productive with an active exchange of opinions
and interactions among the participants.

Group's CSR Activities

Area Committee activities andexecutive talent development in Greater China
The Area Committee activities were first launched in North America in 2011and have been developed in the four regions of the Americas, Europe,
Southeast Asia/Australia and Greater China until now. At the initiative of
Sumitomo Electric Group (SEG) Global Executives in each region, thecommittees work to address common challenges in their region beyond theexecutives of Sumitomo Electric at the Regional Executive Conference. The
committees also serve as a forum for interactions among the personnel.
A feature of the Area Committee activities in Greater China is that they
candidates from Group companies, in which participants work to address
management issues unique to the region. The subjects to be examined, as wellas participants, in the Action Learning program were taken over by the Area
Committee activities, which have then grown while promoting activities withSocial Contribution

originally started with "Action Learning," a training program for executiveCore
Category

borders of individual companies and businesses and report the activities to

SEG Global Executives. In fiscal 2019 and thereafter, the committees are
originally planned for the promotion of Area Committee with a more organizedstructure and financial resources for personnel.

Supply Chain

Sumitomo Electric Group Executive Conference ofGreater China also helps executive talent development

Quality

expected to be strengthened in a phased manner to develop a system

As a feature of the Regional Executive Conference in Greater China, final
reports on the Action Learning program are made along with reports on Area
Committee activities. Since there are only three SEG Global Executives inGreater China, it is an important challenge to promptly develop executive

Human Resources

talents for the next generation among the local employees. Many of those whoreport on the Action Learning program are young, and the Regional Executive
Conference gives them opportunities to present their training results directly tothe management of the Group and receive feedback from them. Thus, theoperation of the conference is also significant for the cultivation of executive
talents.
The subjects of the reports on the Action Learning program made in thisEnvironmental
Preservation

Regional Executive Conference included the dissemination of the Sumitomo
Spirit in Greater China as well as the development of CSR activities. The resultsof active studies on other subjects were also reported respectively.

CSR Report 201918

Comments from participants

We will contribute to raising our profilein Greater China through unique activitiesof the Area Committees
We are sales staff from two different sales companies. It is ourpleasure that we can contribute to the growth of the Sumitomo
Electric Group in Greater China.
Both of us are currently working as a PR committee member. At
the Sumitomo Electric Group Executive Conference of Greater
China held in December 2016, the enhancement of the brandingof the Group in Greater China was selected as a subject for the
Action Learning program. The initiative evolved into the PR
Committee, one of the Area Committees, in the following year.

SHMS Jin Guanghe
General Manager and
SEPH＊ Wu Huaming Vice
HR Manager (right)＊

Manager of ALMT &Direct Sales Department (left)

The Group, which is in the B-to-B business, has a low profile inGreater China and no Group company in the region has a PR
function. We were a little surprised when salespersons like us

Starting with CSR procurement,
which is becoming increasingly important,
we will make our CSR activities inGreater China more active
I joined the Shanghai-based company selling harnesses to car
manufacturers across China in April 2017 after working for a
Chinese car manufacturer and other companies. I started toparticipate in the executive talent development program in March2018 and was committed to the Action Learning program
included in the second half of the training. While the original
subject of the program was shared services, the program
members voluntarily suggested the change of the subject to CSR

SEWS-STC Hui Jianming Vice General Manager＊

after discussions because demand for CSR efforts has been
growing recently in Greater China, and actually adopted CSR as
the subject. Considering the fact that European and US car

TJWS TIANJIN JIN ZHU WIRING SYSTEMS Co.,Ltd.
I certainly feel that our efforts to
executive talent development inGreater China are producing results

Toshihiko Niki

General Manager, TJWSTJWS was jointly established by the Sumitomo Electric Group andformer Tianjin Automotive Corporation, a state-run enterprise in
China, in 1994 as the Group's first company to manufacture andsell wiring harnesses for local automotive companies in China.
While it is said that there is a labor shortage in China, TJWS isfocusing on training new hires to create an industry-readyworkforce and reduce the employee turnover rate.
TJWS also provides local students with learning opportunities in
response to the requests from schools. In fiscal 2017, TJWS won
the GEC Award＊ in the Sumitomo Electric Group and also took firstplace in the commendation of the performance of Group19 CSR Report 2019

Glossary ＊ＳＨＭＳ： Sumitomo Electric Hardmetal Trading (Shanghai) Co., Ltd.
＊ＳＥＰＨ： Sumitomo Electric Interconnect Products (Hong Kong), Ltd.
＊ＳＥＷＳ-ＳＴＣ： SEWS-STC Co., Ltd.

＊GEC Award

GEC stands for Glorious Excellent Company. The Group companies
recognized to be especially excellent for their performance, safety, quality,
etc. are commended once a year with this award.

The 4th Sumitomo Electric Group Executive Conference of Greater China

Regional Executive Conference, we reported our achievements
for the two years, which was the launch of an official account of
our Group for WeChat, an SNS application commonly used in
China, from scratch to successfully increasing the number ofof videos introducing the Group. We assume that we were able
to adopt this approach, which leveraged the SNS, because we
did it as part of the Area Committee activities.
Participation in the Regional Executive Conference allowed us towiden our perspectives and find colleagues from other divisions
with whom we can have discussions. We consider that ourInnovation," a new tagline for the Group.

We will further strengthen andpenetrate the Sumitomo Spirit
and the Sumitomo Electric Group
Corporate Principles toenhance synergy among the GroupAt the 4th Sumitomo Electric Group Executive
Conference of Greater China, I listened to reports
on Area Committee activities and suggestions
from the Action Learning program, whichreminded me of the importance of working for

Governancecollective efforts in the Group will also lead to "Connect with

After the 4th Sumitomo Electric Group
Executive Conference of Greater China

Business Outline

followers to more than 50,000 through initiatives such as posting

Basis for Management

were expected to work as PR committee members. At thisGLOBAL CSR EYE

human resource development with the Sumitomo
Spirit and the Sumitomo Electric Group Corporate
Principles set as the basis.
This conference was attended by SEG Global
Executives in Greater China as well as many
executives from the Group companies. I was

manufacturers have increased the items to be assessed for CSR
procurement from suppliers, we expected that CSR-related
assessment by customers will become ever more important, andthat the Group companies in Greater China, as well as
headquarters in Japan, will have to promote CSR activities.
We carefully examined our report for the conference throughteleconferences and SNS, with focus on how to make theimportance of CSR understood by even those who learn CSR for
the first time. During the breaks between my daily duties of sales
which was fun and rewarding.
Many local employees also attend the Regional Executive
Conference and can learn the policy of the Group to placeemphasis on their development. I believe that VISION 2022 canbe achieved through the commitment of the whole Group based

companies. In particular, while the "disseminationof the Sumitomo Spirit" was one of the subjects
for the Action Learning program, I was greatly
impressed when a participant strongly claimed
the need of sharing the Sumitomo Spirit among all
Group employees, with an acute awareness of its
importance, in a presentation on the subject.
Efforts to develop human resources areindispensable for the Group to continue toexpand its business activities and achieve growth
on a global scale. In those efforts as well, theSumitomo Spirit presents the "ideal future state"and "direction" for us. Sharing of the philosophy
will be a significant initiative for us to reaffirm oursocial roles and learn our relationships withsociety. I felt that the executives in Greater China
who participated in the conference deeply
understand and sincerely agree to the Sumitomo

Qualityon the Sumitomo Spirit.

Group beyond the borders of individualSocial Contribution

activities, I thought about what subjects can be implemented,

discussions from the perspective of the wholeCore
Categorymonthly meetings where the six members gathered, as well asGroup's CSR Activities

pleased to see them have enthusiastic

Electric Group Corporate Principles and havegreat potential to support and lead the Group.
We at the Human Resources Development
Department will continue to work for thedevelopment of a variety of global humanresources based on the Sumitomo Spirit and theSumitomo Electric Group Corporate Principles.

CSR Report 2019

Environmental
Preservation

General Manager,
Human Resources
Development
Department

Human Resources

Yoichi Seki

Supply Chain

companies in the Sumitomo Wiring
Systems Group. I assume that we
received the prizes for therecognition of our efforts to restore
the management of Group
companies through the expansionof sales channels in China and improvement of profitability byseeking reasonable prices, as well as the aforementioned
educational activities.
Vice General Manager He Shihong, who is at the highest position
among the local employees of TJWS and concurrently serves as
General Manager of another Group company, completed the Global
Leadership Development Program. In the workplace, she puts what
she has learned into practice. Even when she is away, the top
management of TJWS functions well and I suppose this factdemonstrates that our efforts to executive talent development are
producing results. We will continue to be committed to developing
human resources in Greater China.

20

Corporate Governance
Basic Approachboard members with various specialized knowledge andUnder our corporate philosophy of the Sumitomo Spirit and theSumitomo Electric Group Corporate Principles, our group
maintains its unwavering basic policy of contributing to society
through our fair business practices. While adhering to this basic
policy, in order to seek sustainable corporate growth and toincrease corporate value over the mid-to-long term, we believethat it is critical to ensure transparency and fairness ofmanagement activities through appropriate corporate
governance, as well as to draw up and implement a growthstrategy fully utilizing our management resources, with the key
word being innovation. We will be committed to further
enhancing our corporate governance in accordance with thefollowing basic ideas:

members occupy the majority of the Audit & Supervisory(1) We will develop an environment in which shareholders can
exercise their rights appropriately.

Board, which aims to reinforce the monitoring system for the
purpose of ensuring lawful and proper management.

Sumitomo Electric Group's corporate governance structure
General Meeting of Shareholders
Appointments / dismissals

Board ofDirectors
Chairman of
the Board of
Directors

Management
Conference

President

We have established Corporate Governance Guidelines setting
forth our basic ideas and policy concerning corporate
governance, which are made available on our website ※ . We
also implement all of the principles in the Corporate
Governance Code.

Outline of the Structure
Sumitomo Electric has employed the system with the audit &supervisory board in consideration of the contribution of audit &supervisory board members and the Audit & Supervisory Board
to ensuring sound business management. The Board of

Directors, the business execution system, audit & supervisoryboard members and the Audit & Supervisory Board arecommitted to fulfillment of their respective duties in order toachieve sustainable growth and medium- and long-term
increases in the corporate value based on the basic philosophy.

In addition, three outside directors are appointed to adopt anexternal perspective with the aims of further strengthening thesupervising functions of the Board of Directors and enhancing
the transparency and objectiveness of the business

management. We also select three outside audit & supervisory

21 CSR Report 2019

Web

Accounting
Audit

Sales UnitsAﬃliates in Japanand Overseas

R&D Unit

Aﬃliates in Japanand Overseas

Production UnitsAﬃliates in Japanand Overseas

Accounting
Auditors

Cooperateop(4) We will emphasize the board of directors functions to(5) In order to contribute to sustainable growth and increase
corporate value over the mid-to-long term, we will engage
in constructive dialogue with shareholders to a reasonable
extent.

Audit &
Supervisory
Board
Members

Co(3) We will disclose corporate information appropriately andensure transparency.
make decisions on basic policy, including strategies, as wellas to supervise management. We will also focus onorganizing systems and operating the Board of Directors toensure the effectiveness of such functions. In respect ofexecutive operations, we have introduced an executive
officer system and a business unit system, for the purposeof clarifying authority and responsibilities, and of
establishing a flexible system to execute operations in
response to changes in the business environment. From aviewpoint of ensuring sound management, we commit tostrengthening audits by audit & supervisory board members
and adopting a supervisory system under which
independent outside audit & supervisory board members
and full-time audit & supervisory board members work with
our internal audit department and accounting auditors toensure the lawful and proper management.

Audit &
Supervisory
Board

Audit

er

at

Audit

e

Cooperate(2) We will take the interests of shareholders and otherstakeholders into consideration, and will appropriately
cooperate with them.

multifaceted views so that outside audit & supervisory board

Internal
Auditing
Department

Cross-Sectional
Risk Management
Activity etc.

Risk Management Committee
Corporate
Staﬀ Group

Compliance Committee
Corporate Environment Committee
Information Management Committee
CSR Committee

The Board of Directors andthe Business Execution System《 Functions and Operations of the Board of Directors 》
While the board of directors of a company with an audit &supervisory board serves functions to make decisions on andsupervise business execution, the Board of Directors of

Sumitomo Electric deliberates only important issues amongindividual subjects, such as major investment items, and focuseson the medium-term business plan, annual plans based on it andquarterly follow-ups of the plans, so that it can appropriately

perform the function to decide basic matters concerning thedirection of the Company, as well as the supervising function.

Independent outside directors are appointed in the Board of
Directors as mentioned above to ensure multifaceted andsufficient discussions in the meetings, in which independent

outside audit & supervisory board members are also provided
with opportunities to present their opinions actively. As tosupervising function of the Board of Directors, while we respect
opinions of the independent outside directors and otherindependent outside officers to ensure the independence andobjectiveness, we have set up the Nominating Advisory

Committee and the Compensation Advisory Committee, which
are both chaired by an independent outside director and madeup of a majority of independent outside officers, to enhance theeffectiveness. The Committees give advice when the Board of
Directors appoints candidates for directors and audit &supervisory board members and makes a decision on thecompensations of directors.

Sumitomo Electric holds monthly meetings of the Board of

Directors as well as extraordinary meetings when necessary.

※ For the details of the Corporate Governance Guidelines, please see the following page.

https://global-sei.com/company/pdf/governance.pdf

Directors deliberates and takes decisions on the matters

mentioned above, makes decisions on the basic policy of theinternal control system and supervises the development andoperation of the system. There are currently 13 Directors in the
Company, who are comprised of 10 Executive Directors andthree outside Directors not involved in business execution, andDirectors (excluding four outside Directors) received 830
million yen in total.

《 Effectiveness Analysis and Assessment of the Board of Directors 》《 Business Execution System 》

To clarify authority and responsibility in the business execution
system and establish a flexible system that can respond tochanges in the business environment, Sumitomo Electric adopted
the Executive Officer System and the Business Unit System.
Authority to execute business operations has been transferred toBusiness Units while their responsibility has been clarified, and toestablish an internal check function, our corporate regulations
specify the scope of authority of each of the Business Units
including the Corporate Staff Group, responsible personnel forthe execution and appropriate business procedures.

board members including outside officers in March 2019 andmade discussions based on the results at a Board of Directors

meeting held in May of the same year. The results of the analysis
and assessment and future initiatives are summarized below:① Operation of the Board of Directors and advisorycommittees for the nomination and compensation of
executives, directors, etc.

The findings showed that the operation of the Board of

Directors has been improved through the promotion of

initiatives including the review of the matters to be discussed
at the Board of Directors meetings. On the other hand, it wasalso indicated that we should strive to improve the operation
by making key points clearer in the handouts for discussions

and simplifying the explanation of the issues to be discussed sothat sufficient time for discussions can be set aside. In themeantime, the operation of the Nominating Advisory

Committee and the Compensation Advisory Committee andthe reporting of the discussions to the Board of Directors were
found to have been conducted generally properly.

② Structure of the Board of Directors

The findings showed that the increase in outside directors andother structural changes have enabled the Board of Directors

to make more active and multifaceted discussions and that thestructure and other aspects of the Board of Directors are

the overall balance of their knowledge and experience. In the
future, while also considering social trends and other issues,
we will continue to examine the ideal state of the Board of

Directors in terms of structure and other aspects to contributeto the sustainable growth of Sumitomo Electric and mid- to③ Role of the Board of Directors

The findings showed that the Board of Directors basically plays
its role in "deliberating and determining on the basic

management policy and other important corporate issues" and"supervising the business execution of directors" through its

important matters and at the time of quarterly performance
reporting and reporting on the progress of the improvement of
the internal control system. In the future, we will continue towork for improvement through measures including the reviewof the matters to be discussed at the Board of Directors

meetings from the perspective of importance, in addition to theThus, we have confirmed that the Board of Directors of

Sumitomo Electric is effective in general at present. We willcontinue to strive for the improvement of the Board of
Directors to further enhance its effectiveness.

CSR Report 2019

Environmental
Preservation

improvement of operation as mentioned in ① above.

We have established the Financial Reporting Internal Control
Committee, chaired by the President, and an organization topromote control in the Corporate Staff Group. Under their policy,
guidance and support, we promote development and proper
operation of the internal control system in each division andaffiliate in accordance with the Financial Instruments andExchange Act, as well as the assessment, audit criteria andenforcement criteria specified by the Financial Services Agency.
Thus, we are committed to further improving the systems toensure appropriateness of financial reporting. The Internal
Auditing Department assesses the effectiveness of the internal
control system of the whole group for each fiscal year. Based on
the results of such assessment, the department is required tocompile an internal control report to be submitted to the Financial
Services Agency and obtain the approval of the Financial
Reporting Internal Control Committee and the Board of Directors.

Human Resources

activities including active discussions in deliberation on

Ensuring Appropriateness ofFinancial Reporting

Supply Chain

long-term improvement of the corporate value.

Qualitygenerally appropriate in terms of the number of members andSocial Contribution

As to the audit & supervisory board members and the Audit &Supervisory Board, as mentioned above, the majority of the audit& supervisory board members are independent outside audit &supervisory board members with various specialized knowledge
and multifaceted views. These members of the board, along withfull-time audit & supervisory board members and dedicated staff
to audit & supervisory board members, are in charge ofmonitoring in cooperation with the Internal Auditing Department
and accounting auditors to ensure lawful and proper corporate
management.
Five audit & supervisory board members, consisting of two
full-time members of the board and three outside members of
the board including a female one, constitute the auditing system
to audit the business execution of directors. The Audit &Supervisory Board establishes audit plans and policies, inaccordance with which each audit & supervisory board member
fulfills his role, as assigned by the Audit & Supervisory Board.
Specifically, audit & supervisory board members attend
important meetings including those of the Board of Directors,
conduct hearings with the directors, Internal Auditing
Department and other employees regarding their duties,
inspect important authorization documents and visit majorestablishments to conduct audits. Audit & supervisory board
members also receive reports from other members of the board
regarding their audit status, and exchange information with theaccounting auditor when required.
The section in charge of internal audits is the Internal Auditing
Department, which surveys any problems and makes proposals
on improvement to ensure proper and efficient businessperformance through audits, including on-site surveys, of ourGroup companies and other establishments. The department
also collaborates with audit & supervisory board members andaccounting auditors on an as-needed basis in the audits.
The accounting audits and internal control audits to be conductedby accounting auditors are outsourced to KPMG AZSA LLC.

questionnaire survey of all directors and audit & supervisory

Core
Category

2015. As an initiative for fiscal 2018, it conducted aGroup's CSR Activities

Auditing and Supervision Systems

effectiveness and disclose a summary of the results in fiscal

Governance

The Board of Directors started to analyze and evaluate its

Business Outline

one of them is a female outside Director. For fiscal 2018, 12

Basis for Management

In the meetings, which are chaired by Chairman, the Board of22

Risk Management
Basic Approach

Risk Management Activities

The Sumitomo Electric Group identifies, analyzes and assesses
business risks, which include the factors that prevent theimplementation of its business activities or achievement ofmanagement goals and strategies, as well as the factors that
potentially have adverse impact, and then seeks to reduce andminimize them at a reasonable cost and with reasonable
efforts.
With respect to cross-sectional risks common to all divisions
and affiliates in the Group, the relevant corporate staff
divisions, as well as company-wide committees organized by
officers in charge, identify, analyze and assess the risks
according to their duties, and then take measures to mitigate
them.
The divisions and sales and R&D groups individually identify,
analyze and assess the risks associated with their business
operations, and then take measures to reduce them.

Risk management activities of the Sumitomo Electric Group arebased on taking inventory of risks that is conducted by each
unit and each affiliate. In the inventory, which is conductedannually, the signiﬁcance of each of the risk items isdetermined by scoring its severity, frequency of occurrence andother factors. Measures to deal with any significant risks are
discussed and taken.
Annual results of the risk inventory are shared with executives
and the corporate staff divisions. With mutual cooperation
between them, group-wide risk management activities arepromoted steadily.

Basic Policy of Risk Management
Risk management is performed based on the significance ofthe risks determined in consideration of the following issues:
●

●
●

●
●

Impact on business performance, maintenance of quality
and safety
Social responsibility to ensure stable supply
Maintenance of favorable relations with stakeholders
such as customers, suppliers, shareholders/investors,
local communities and employees
Continuous compliance with laws and corporate ethics
Statements in the Sumitomo Spirit, the Sumitomo ElectricGroup Corporate Principles and the Sumitomo ElectricGroup Charter of Corporate Behavior

Risk Management System
The Sumitomo Electric Group holds a meeting of the Risk
Management Committee, which controls overall risk
management activities, in conjunction with a meeting of the
management conference. The Risk Management Steering
Committee is responsible for actual implementation under the
Risk Management Committee, and its tasks include formulationof risk management policies, establishment of task forces at thetime of an emergency, collection of information and planningand implementation of risk management education. The
Compliance & Risk Management Office serves as the organizer
for these committees.

Risk Management System
Board of Directors

Company-wide
Committees

Management Conference

Compliance Committee

Risk Management Committee

CSR Committee

Risk Management Steering Committee
Compliance & Risk Management Oﬃce
Corporate Staﬀ Group

Public Relations
Committee
Corporate Environment
Committee

Risk manager
Legal, Public Relations, Human Resources, Accounting,Information Systems, Procurement, Logistics,
Safety & Environment, Plant & Production Systems Engineering

Business Units, Sales Units,
Research & Development Unit

Divisions

Risk manager

23 CSR Report 2019

Aﬃliates

Risk manager

Risk manager《 Creation and Management of a Risk Heat Map 》

The Sumitomo Electric Group is making efforts to establish amore efficient mechanism for risk management so that it can
respond to the expansion of the business fields and changes inthe external environment effectively. We compiled a databaseof the results of risk inventory and information on the identified
risks, as well as the results of operational audits and othermonitoring activities, and created a risk heat map based on the
database to visualize the risks to each of the units andaffiliates. This map enables each of them to take measures toaddress the items with higher risk levels preferentially andenhance the efficiency and effectiveness of the risk
management activities.

Initiatives for Business Continuity《 Promotion of Business Continuity Management (BCM) 》
Sumitomo Electric has developed Business Continuity Plans(BCPs) since fiscal 2007 to ensure that our importantbusinesses can be continued even in the event of an
emergency, such as an earthquake and pandemic of influenza,
and that we can swiftly resume operations when ouroperations are interrupted. We also promoted business
continuity management (BCM) for continuous improvement of
the BCPs. In addition, we review the BCPs periodically, verify
the effectiveness of the emergency response plan and takeinventory of supply chain risks every fiscal year.
In line with the growing importance of overseas bases, westarted to promote development of BCPs in each of theoverseas subsidiaries as well in fiscal 2014.
Moreover, to reinforce our business continuity capabilities, we
provide BCP training to risk managers appointed in thedepartments and affiliates once a year to ensure that they canpromote the preparation and revision of the BCPs for theirdepartments and affiliates and further enhance theeffectiveness of the BCPs.

《 Continuous Implementation of Group-wide Joint Emergency Drills 》
The Sumitomo Electric Group enhances disaster awareness of
employees by implementing joint emergency drills to conduct
the drills in Group companies at the same time twice a year (inthe daytime and at night).
Our production facilities carry out evacuation drills, which
include confirmation of the safety of employees, as well as
inspection of places where hazardous materials are used andsimulation of the initial response to emergency situations.
In the meantime, drills of information transmission and sharing
are also implemented by establishing headquarters ofcountermeasures with the aims of grasping disaster information
promptly, reporting it accurately and promptly to executives
and sharing the information among the Group.

《 Cooperation with Local Communities 》

As a corporate citizen, we are committed to enhancing disaster
preparedness abilities of the local communities, through theconclusion of disaster preparedness agreements with local
governments and other means, in the areas where our bases
are located.

The Sumitomo Electric Group improves the information
management system and revised rules and enhance themechanism to prevent information leakage in each of its
have also established a social media policy, which specifies ourbasic approach to its use, as well as social media guidelines,
which provide specific issues to be noted. The policy andguidelines serve to raise the awareness of employees. We willcontinue to promote information management of the Group by
improving the system in domestic and overseas affiliates andenhancing the internal training program designed for《 Protection of Personal Information 》

In accordance with its Personal Information Protection Policy,
Personal Information Protection Rules and other rules,
Sumitomo Electric properly deals with the personal informationof customers, business partners and employees handled in thecourse of its business while complying with laws, regulations

Sumitomo Electric has set forth internal rules on security tradecontrol to ensure compliance with export control regulations
aimed at international security, and established an export control
system headed by a representative director.
Our export activities are conducted after proper screening ofindividual business transactions and obtainment of necessary
export licenses such as comprehensive export license.
Our employees and persons concerned are provided withposition-based training, as well as periodical training, which deals
with the latest cases, and training at the time of their appointment
to the position, so that they are aware of their responsibility forsecurity trade control and obtain necessary knowledge.
We also conduct audits in the Company and its affiliates in Japanand overseas constantly to monitor export activities, and share
information between different divisions within the Company andbetween affiliates through various committees to reduce the risks
in the security trade control activities of the entire group.
Record of Various Training Sessions in FY 2018
Target of
the training

No. ofNo. ofsessions participants

Main content

20

134

Tasks on how to classify
goods and technologies

Export control
sections

30

1,180

Export control practiceGeneral employees〈e-learning〉

―

3,310

Outline of export control
and internal rules

problems. In addition, we revised the aforementioned policy

Domestic aﬃliates

682

Outline of export control

and rules in May 2017 in response to the full implementation

Overseasaﬃliates

21

282

Outline of export control and issues
to be noted in foreign countries

personal information. We also formulated the rules for handlingspecified personal information in November 2015 to ensurethat such information is handled properly in accordance withlaws and regulations and to prevent leakage and otherof the amended Act on the Protection of Personal Information.

General Data Protection Regulation (GDPR) in May 2018 toby GDPR. Contract procedures to smoothly share personal dataof EEA residents in our group have been also completed.
Furthermore, we have put in place a system to promptly reportany leak, loss, damage or other infringement of personal data of
EEA residents to the supervising agency in the EEA.
We have set up an ICT Management Committee in the fivecountries of China, Thailand, Indonesia, Malaysia and theUnited States as the basis of our global expansion and worked
to enhance information security measures through theCommittee. This commitment has led to such results as the
reduction of the risk of infection by computer viruses and the
We are taking measures to prevent the leakage of information
on trade secrets and other important management assets on a
global scale, including installation of antivirus software andintrusion prevention systems (IPS), data encryption in mobile
computers and USB devices, automatic encryption of files
emails and introduction of AI-based anti-malware software toenhance protection from unknown malware. In addition, we
have set up a mechanism for the investigation of the traces ofhacking as well as the investigation and detection of any illicit
acts using log information of servers and network devices.
With respect to the corporate structure, SEI-CSIRT (Computerplaying a central role in our efforts to promptly identify andrespond to any incidents relating to information security in ourGroup companies.

Environmental
Preservation

Security Incident Response Team), established in 2017, is now

Human Resources

attached to emails, training to respond to targeted attack

Supply Chain

implementation of information security training.

Quality《 Strengthening of Information Security Measures 》

Sumitomo Electric develops and manufactures various products
based on its unique technologies. Proper protection andmanagement of those products based on intellectual property
rights (IPRs) is an important issue for our business management.
Therefore, while promoting technical development, we are actively
committed to the appropriate management of technical know-how
and internal data as well as acquisition and use of IPRs such as
patent rights and design rights. At the same time, we pay
scrupulous attention and respect to the IPRs of other companies.
To this end, we have developed a rule on handling of trade
secrets and intellectual property, and established an organization
to provide business units and R&D units including those in our
subsidiaries with necessary support, such as management of
inventions, investigation of prior arts and IPRs of other companies,
promotion of technology standardization activities and formulationof strategy and response from the perspective of intellectual
property-related laws and regulations, in the Intellectual Property
Department. Actual intellectual property activities, including
planning and implementation of them, verification of the progressand results and correction of any inappropriate points, arepromoted through concerted efforts among respective divisions,R&D units and the Intellectual Property Department in the IP
strategy meeting, which led by strategic IP committee members ofthe divisions and responsible persons in the Intellectual Property
Department, based on the PDCA (plan-do-check-act) cycle.
To improve the IP activities of our group as a whole, we continue
to organize IP training sessions that match the experience andlevel of proficiency of each employee and publish related in-housenewsletters. We also hold an Intellectual Property Right andStandardization Convention every year as a company-wide eventto commend excellent IP activities.
Through these IP-related efforts, we promote the generation ofbusiness opportunities and reduction of IP risks in the whole group.

Social Contribution

properly protect the personal data of EEA residents as specified

Intellectual Property Protection

Core
Category

Also, we have newly developed EEA＊ Residents Personal Data
Handling Rules in response to the enforcement of the EU

Group's CSR Activities

Staﬀ in chargeof classiﬁcationand other standards relating to the protection and use of

Governancedisseminating the rules.

Security Trade Control

Business Outline

divisions and affiliates. Regarding the use of social media, weBasis for Management

Protection of Personal Information,and Information Security

Glossary ＊EEA

EEA stands for European Economic Area, which consists of the EU
member states as well as Iceland, Liechtenstein and Norway.

CSR Report 201924

Compliance
Efforts to Pursue Fair Business
Activities Worthy of Society's Trust
The Sumitomo Electric Group believes that compliance,
which represents both complying with laws and regulations
and acting in accordance with corporate ethics, comprises
the backbone of its management and forms the absolutebasis for its continued existence and development. In light of
the recent trend of various compliance items, including
competition laws, prevention of bribery, trade control rules
and quality data issues, and under the principles of theSumitomo Spirit, which values doing your sincere best not
only in business but also every aspect of your life, placing
prime importance on integrity and sound management andnot pursuing immoral business, we will continue to make all
efforts to ensure that all corporate activities are conducted
fairly and honestly and can be trusted by society.

《 Sections in Charge of Compliance Items 》

The sections in charge of each of the compliance items in the
Sumitomo Electric Group are listed below:

Sections in charge of compliance items
Compliance items

Human Resources
Development Department

Competition laws
Prevention of bribery

Compliance &Risk Management Oﬃce,
Legal Department

Security trade control

Security Trade Control Oﬃce

Prevention of insider trading, preventionof illegal money transfer

Finance Department

Political contributions and donations
Elimination of antisocial forces
Construction business and electric business

Organization That Supports Complianceand Its Structure《 Compliance Committee 》

Sumitomo Electric Group has established the Compliance
Committee, chaired by the President, as an organization thatdesigns and promotes measures necessary to develop andfurther strengthen the compliance system and holds its
meeting roughly four times a year. The Committee engages invarious activities, including identification and analysis ofgroup-wide and overall compliance risks, monitoring of theimplementation of programs for the compliance items andinterviews with divisions and Group companies concerning
their activities to comply with laws. Compliance & Risk
Management Office and Legal Department serve as theorganizers of the Committee.

Structure of the Compliance Committee

Chairperson: President
Vice Chairperson: Senior Managing Director
Committee members:

Senior Managing Director (1 person)
Managing Director (1 person)
General Manager of Compliance & Risk Management Oﬃce
General Manager of Legal Department
General Manager of Internal Auditing Department

Attendants:

Audit & Supervisory
Board Member
General Manager of Oﬃce
of Audit & Supervisory
Board Members

While planning and coordinating overall compliance activities
in the Sumitomo Electric Group, Compliance & Risk
Management Office plans and implements relevant activities
including the development of a system and organization oftraining for compliance with competition laws and preventionof bribery. The office also operates the whistle-blowing
system (Speak-Up System) of the Group. Led by the General
Manager, the office is composed of members including
employees from Corporate Staff Group such as Legal
Department, Human Resources Division and Internal Auditing
Department as well as persons in charge of compliance tasks
in Business Units and Sales Units. The responsible persons forcompliance activities at overseas legal and compliance bases
concurrently serve as the members as well. A compliance
meeting is held every month to share relevant informationand monitor the progress of compliance activities.
Sales Units and Automotive Business Unit respectively havean internal organization dedicated to compliance (Sales
Compliance Office and Automotive Compliance Office).

Account settlement and tax aﬀairs

Accounting Division

Prevention of conﬂicts of interest(competitive operation)
Information management(conﬁdential information, personal information)
Prevention of unfair competition(illegal acquisition of conﬁdential information)

Compliance &Risk Management Oﬃce,
Legal Department

Indication of origin
Intellectual property (service inventions,
IP contracts, IP-related laws)

Intellectual Property
Department

Proper use of information systems

Information Systems Division

Information security (cyber security)

SEI-CSIRT Oﬃce

Timely disclosure of company information

Public Relations Department

Respect for human rights, prohibition of discrimination
Prohibition of harassment
Employment management(compliance with labor-related laws)

Human Resources
Division

Prohibition of any act that abuses opportunities given
for business

Health and safety
Environmental conservation

Safety & Environment
Department

Prevention of quality problems(defects in products, quality disguise, etc.)

Quality Management Division

Relevant laws, energy saving andsafety assessment associated with capital investments

Plant & Production
Systems Engineering Division

Customs (in Japan)
Procurement Division

Prevention of improper trading (purchasing)
Customs (overseas)

Logistics Management
Department

Subsidy

R&D Planning &Administration DivisionInternal control

Internal Auditing
Department

Compliance Activities《 Code of Conduct 》

The Compliance Committee established and issued Code of
Conduct, which serves as guidelines setting out the standardsof conduct expected of each of us and helping us conductbusiness with integrity, based on the Sumitomo Spirit with theapproval of the Board of Directors in April 2018. The Code of
Conduct is basic rules on compliance commonly applied to
all Group companies across the world. In addition to legal
compliance, it specifies the basic policy on fair competition,
prevention of bribery, protection of confidential information

Glossary ＊Subcontract Act

25 CSR Report 2019

Administration Division

Business decisions of directors, lawful operation of
the Board of Directors meetings and general meetingsof shareholders

Subcontract Act＊《 Compliance & Risk Management Office 》

Sections in charge

The Sumitomo Spirit

The Act against Delay in Payment of Subcontract
Proceeds, etc. to Subcontractors Japanese law

environmental conservation and other issues. Printed

booklets (in Japanese, English and Chinese) are distributed to
officers and employees in our groupwhile multilingual versions inapproximately 30 languages, including

addition, to inform employees of thesummary posters in Japanese, English

External contacts

11

54

Total
65

2017

24

50

74

2018

31

63

94

《 Compliance with Competition Laws 》

and Chinese and display them in the

Code of Conduct

preventive measures and develop and enhance awareness ofcompliance, the Compliance Committee organizes regulartraining seminars for all officers and managers every year.
New employees and newly promoted personnel are also
provided with position-based training seminars. The regulartraining seminars for managers are held from April to July

Group's CSR Activities

concerning such subjects as

The Sumitomo Electric Group prioritizes global competition
law compliance as the most important compliance activity
and has taken measures to eliminate, and prevent a
recurrence of, cartel and collusion, including suspicious acts
within the Group. These measures include the formulation of
the Rules for Compliance with Competition Laws in June
2010, which contain a provision that restricts contact withcompetitors only in the cases with legitimate businessreasons, and mandatory compliance training (including online
training) organized for sales staff and other employees
around the world.

GovernanceTo check compliance risks, ensure implementation of

Number of Employees Who Took Competition Law Compliance Training(Including Online Training)

prevention of quality

disguise, compliance withcompetition laws andprevention of bribery, and
we also disseminate the

Speak-Up System mentioned

FY

Number of attendants

2014

approx. 4,400

Attendance rate
99%

2015

approx. 4,700

95%

2016

approx. 5,00091%

Compliance training

Number of attendants (period)《 Prevention of Bribery 》

The Sumitomo Electric Group introduced an anti-bribery

program in April 2013 to enhance its anti-bribery compliance42（Dec. 2018）

Newly promoted personnel

approx. 600 (Feb. - Mar. 2019)

New employees of Sumitomo Electric

approx. 300 (Apr. 2018)

markets, this program has established anti-bribery rules,

Managers of Sumitomo Electric andits subsidiaries in Japan

approx. 6,100 (Apr. - Jul. 2018)

ex-post report on gifts, hospitality and donations, andThe Sumitomo Electric Group established the Speak-Up

System as a system to identify any compliance-related issues
at an early stage and resolve them by ourselves in a prompt
and proper manner. Specifically, we set up contacts forexternally (by appointing a law firm and a specialized service
provider), and the issues reported through this system areaddressed with immediate investigation to take corrective

action and prevent recurrence where necessary. The contacts

for consultation and reporting have been established to allow
any employees of Group companies in and out of Japan as

outline of the system at the time of various internal training
sessions and also disseminate it through monthly in-housenewsletters, Code of Conduct, our website, intranet,

workplace posters, notice to business partners and othermeasures. We established an external contact for

our Group companies outside Japan in 2014. As a result of
our active efforts to disseminate it, the number ofconsultations and reports continues to increase year by year,
helping to eliminate inappropriate actions and circumstances.

manager to implement the rules.

Five years have passed since the anti-bribery program

started. Based on environmental changes during that period,

we revised it in January 2018 to focus on high risk in giving
inappropriate hospitality. We have also distributed a bribery
prevention manual to the bribery prevention managers ofGroup companies, who are in charge of operation of the

program, and provided them with detailed training. We willkeep working to maintain and enhance the global bribery
prevention system through continuous education,

improvement of the program and its manual as well as
collection and dissemination of relevant information.

《 Compliance on Quality 》

In response to recent scandals of data falsification andimproper inspection, the Sumitomo Electric Group took
measures to enhance compliance on quality throughinitiatives including survey targeting divisions of Sumitomo
Electric and its Group companies on business rules andoperation systems for quality and inspection procedures,
clarification of company-wide rules to prevent quality data
falsification, improvement of relevant training andstrengthening of the audits again in fiscal 2018 (see "Quality
Compliance" in P49-50 for details).

CSR Report 2019

Environmental
Preservation

consultation and reporting that can be used commonly byrequested each division to appoint a bribery prevention

Human Resources

well as other interested persons to access. We present theincluding prohibition against bribery, prior approval andSupply Chain

consultation and reporting not only internally but also

and foreign public officials in the US, Europe and emerging

Quality《 Speak-Up System 》

the recent tightening of anti-bribery regulations on domestic

Social Contribution

system and has developed it on a global scale. In response toOﬃcers (including executive oﬃcers)

Core
Category

Targets of the Training and Number of Attendants (Period)
Target of the training

In-house contacts

Priority Matters

Code of Conduct, we prepare

below in the seminars.

FY
2016

Business Outline

posted on our website and intranet. In《 Compliance Education 》

Number of Consultations at the Contacts of the Group-wide System※Note that consultations were also requested at contacts established individuallyby Group companies in addition to the consultations above.

Japanese, English and Chinese, areoffices and plants of relevant bases.

Basis for Management

and intellectual property, respect for human rights,

26

Respect for Human Rights
Establishment of the Sumitomo Electric Group Policy on Human Rights
Based on the Sumitomo Spirit and the Sumitomo ElectricGroup Corporate Principles, which serve as its basic
philosophy, we have been promoting initiatives to ensure
respect for human rights including efforts to eliminate
discrimination. The Sumitomo Electric Group Code of
Conduct also sets a standard that guarantees respect forhuman rights and prohibits any form of discrimination orharassment. In March 2019, the Sumitomo Electric Group
Policy on Human Rights was established to respond to thevarious needs of our stakeholders and to clearly show ourcommitment to respecting human rights in conformance withinternational standards.
To ensure that our initiatives are promoted in line with thispolicy, we will implement training programs to educate
employees about human rights and conduct fact-finding
investigations regularly at relevant stakeholders, including
domestic and overseas affiliates and business partners, whilesetting specific operational guidelines, etc. as necessary.

The Sumitomo Electric Group Policy on Human Rights※
The Sumitomo Electric Group, in accordance with the Sumitomo
Spirit and the Sumitomo Electric Group Corporate Principles,shall strive to be a group of companies worthy of society's trustby conducting business activities in an honest manner.
As we continue to develop together with the global community,
the Sumitomo Electric Group recognizes that all of its businessactivities must be based on respect for human rights. The
Sumitomo Electric Group will work ethically and responsibly forthe respect of human rights ensuring that our entire group will
uphold this standard.

１. Stance

The Sumitomo Electric Group hereby sets The Sumitomo
Electric Group Policy on Human Rights (hereinafter referred toas the Policy ) to promote initiatives for respect to humanrights. The Policy shall be guided by the following documents:
International Bill of Human Rights (the Universal Declaration of
Human Rights and the International Covenants on Human Rights)
that sets forth fundamental human rights to be enjoyed by all
people in the world; the ILO Declaration on Fundamental
Principles and Rights at Work set forth by the International
Labour Organization (ILO) which stipulates basic rights at work
i.e. freedom of association and the effective recognition of theright to collective bargaining, the elimination of forced orcompulsory labour, the abolition of child labour and theelimination of discrimination in respect of employment andoccupation; and the Guiding Principles on Business and Human
Rights of the United Nations. The Policy represents theSumitomo Electric Group s commitment to respecting humanrights based on The Sumitomo Spirit and The Sumitomo ElectricGroup Corporate Principles as described in the Code of
Conduct.

２. Scope of Application

The Policy will apply to all executives and employees of theSumitomo Electric Group (all employees including executives,
permanent employees and contract employees.) The Sumitomo
Electric Group also expects all business partners related to its
business activities to comply with the Policy.

３. Responsibility to Respect Human Rights

The Sumitomo Electric Group will aim to fulfil its responsibilities
by ensuring that its business activities respect and enhance
human rights. In the event our business activities should make

《 Human Rights Education and Training 》

We are also making continuous efforts for human rights

training and enlightenment to solve a wide range of humanrights issues including discrimination and sexual harassment.

In 2018, a total of 17,811 persons participated in the humanrights-related seminars, including the education provided

mainly by Human Rights Task Committee members at theirworksites.

27 CSR Report 2019

Web

※This policy is posted on our website.

Date of establishment: March 19, 2019any adverse impact on human rights, it shall be handledappropriately for correction.
Furthermore, we expect our business partners and stakeholders
to respect the same standards of human rights as the Sumitomo
Electric Group, to prevent violation and correct any breaches.

① Human Rights Due Diligence

To fulfill our responsibilities in regard to respect for humanrights, the Sumitomo Electric Group will establish a system of
human rights due diligence through the implementation of
Guiding Principles on Business and Human Rights of theUnited Nations, and implement this in an ongoing manner.
Human rights due diligence includes specifying and evaluating
negative impacts imposed potentially or actually and taking
measures to prevent or mitigate such risks.

② Remedy

In the event the Sumitomo Electric Groupʼ s business activities
result in violation of human rights or it becomes clear that it wasinvolved in making such adverse impact, we will provide for an
appropriate remedy.

③ Training and Education

The Sumitomo Electric Group will provide appropriate training
and education to its executives and employees.

④ Compliance with Applicable Laws and Regulations

The Sumitomo Electric Group will comply with the laws andregulations of all countries where it conducts its businessactivities. In the event that we face contradiction between
internationally recognized human rights standards and the lawsof the relevant country, the Sumitomo Electric Group will pursue
ways to honor the principles of internationally recognizedhuman rights.

⑤ Dialogue and Consultation

The Sumitomo Electric Group, in various efforts under the Policy,
will make use of the independent and external expertise
concerning human rights and will engage sincerely in holding
dialogues and consultation with the stakeholders.

⑥ Information Disclosure

The Sumitomo Electric Group will disclose the progress of theinitiatives regarding human rights based on the Policy on its
website and reports.

《 Establishment of Consultation Services 》

We have set up two consultation services regarding humanrights. One is supervised by the Compliance Committee andintended to support employees with focus on laws andregulations in general. Another is managed by the Human
Resources（HR) Division and deals with various kinds ofharassment in working environments such as sexual
harassment, pregnancy discrimination and abuses ofauthorities. With these services, Sumitomo Electric has inplace a system to quickly gather information on any violationof human rights and take appropriate measures against them.

https://global-sei.com/csr/sociality/office.html

Relationships with Stakeholders

GlobalEnvironment

We promote environmental management
based on our policy that places environmental
conservation activities as a top businesspriority.

Customers

We provide customers across the world witha wide range of products and services in ﬁve
categories: Automotive; Infocommunications;Electronics; Environment & Energy; andIndustrial Materials.
The Sumitomo Electric Group conducts
business activities through 390 companies
located in approx. 40 countries/areas allover the world (as of March 31, 2019).

Shareholders
andInvestors

The total number of our shareholders is approx. 60,000,
and the number of shares issued and outstanding isabout 800 million. By type of shareholders, ﬁnancial
institutions and foreign holders own 41.7% and 37.2% of
the shares respectively, followed by Japaneseindividuals and others (13.0%) (as of March 31, 2019).

Suppliers

The Partners' Meeting held in ﬁscal 2018
gathered approx. 93 of our main suppliers.
(FY2018)

Reduction of greenhouse gas emissions
Promotion of energy saving and recycling● Reduction of the amount of waste, reduction of
the release of harmful chemical substances

Comply with the relevant laws and regulations
Environmental conservation activities inaccordance with the PDCA cycle● Stakeholder dialogue

●

●

●

●

Supply of socially useful andsafe products and services
Improvement of customer satisfaction
on all aspects including delivery time, etc.
● Provision of accurate andappropriate information on products

Communication through daily operations
Newsletters, e-mail delivery, websites● Information exchange at exhibitions etc.

●

●
●

●

Respect for culture and custom,
contribution to development● Prevention of accidents and disasters,
environmental conservation● Cooperation and coordination for the solutionof environmental and other problems●

Respect for human rights,
personality and individuality
Development, use and evaluation of human resources● Creation of a work environment where all
employees can demonstrate their capabilities● Contribution to occupational safety and health●●

Maintenance and improvementof the corporate value
Proper return of the proﬁts (as dividends)● Timely and proper disclosureof corporate information●

Surveys to create a lively work environment
In-house magazines, Global Magazines
Intranet, President's blog
● Management council meetings fordiscussion between labor and management● Informal meetings between executives and employees
●
●
●

●
●

●

●

●

General meetings of shareholders
Financial result brieﬁngs
Reception of investors and interviewers● Annual reports● Investor relations website●●

Participation in events, support of traditional performing arts
Factory tours, opening of facilities, joint hosting of festivals
Employees' contribution to local communities● Communication through cooperation and support● Stakeholder dialogue●●

Fair trade
Support and cooperation for
the achievement of CSR procurement●●●

Communication through daily procurement activities
Partners' meetings
Communication through the supplier survey sheet andother channels

Results of Information Transmission through SEI's Main Media by Year
（Number）

100

84

105
79

67

0

30
2016

2017

2018

Press release

2016

2017

Interview

2018

2016

22

23

2017

2018

President's blog

(Fiscalyear)

CSR Report 2019

Environmental
Preservation

50

89

61

Human Resources

Sumitomo Electric believes that an important goal of its
investor relations is to notify market participants of accurate
information in a timely and fair manner, so as to obtainappropriate evaluation of our corporate value in the capital
market.
The Company works to enhance communication withinstitutional investors and analysts at such occasions as
briefings on financial results and interviews. For generalshareholders and investors, we post a wide range of
information on our websites, including financial information,press releases and materials distributed in financial result
briefings as well as relevant video images.
We will continuously promote fair and prompt information
disclosure and further improvement of the content.

Supply Chain

Sumitomo Electric has actively disseminated information on awide range of activities of the Group through various media
such as press releases, interviews and websites to help our
stakeholders improve understanding of the Group. This fiscal
year, while implementing the annual activities, we also
renewed our tagline to adopt "Connect with Innovation" in
conjunction with the release of the mid-term management
plan VISION 2022 in May 2018 and promoted theapplication of it to various media including posters,
signboards and business cards. Meanwhile, we also reviewed
the visual identity (VI) that aims to give consistency todesigns, logos, colors and fonts throughout the Sumitomo
Electric Group and establish a common impression andworldview. We are continuously working to disseminate the
new VI by applying it to various publications and promotional
materials.
Moreover, with the aim of improving our brand image, wehave thoroughly updated our company profile video andbrochure.
In the meantime, we will enhance the communication of
information on the activities of our athletics club and our
support to sports events such as Lake Biwa Mainichi
Marathon, to increase a sense of unity within the Group, as
well as to help promote sports and physical exercises.

Quality

The Sumitomo Electric Group Charter of Corporate Behavior
stipulates that we will aim to disclose appropriate corporate
information to our stakeholders to promote communication
with society. In accordance with the charter, we haveestablished a system in which information on occurredmaterial facts and decisions is collected and confirmed bypublic relations sections in cooperation with relevant
divisions so as to promote timely and accurate information
disclosure. In addition, Sumitomo Electric established the
Public Relations Committee in 2006 as a cross-sectionalorganization to enhance the information disclosure system.
The committee engages in activities such as development ofrules on corporate information disclosure, related educationand knowledge dissemination within the Group and planningof measures to enhance the corporate brand value.

Social Contribution

Efforts to Disseminate Information

Core
Category

Disclosure of Corporate Information

Communication with
Shareholders and Investors

Group's CSR Activities

Employees

The Sumitomo Electric Group has approx.
273,000 employees consisting of approx.
40,000 employees in Japan and approx.
233,000 employees in other countries.
More than 80% of the Group employees thus
work outside Japan (as of March 31, 2019).

Main means of communications
Communications through economic
organizations and trade associations● Notiﬁcations, response to surveys and questionnaires● Consultation with competent authorities,
public comments●

Governance

Local Communities
andNPOs/NGOs

Compliance with laws, regulations,administrative guidance, etc.
● Tax payments● Cooperation for government policies tosolve public problems●

Business Outline

Sumitomo Electric Group

CentralandLocal Governments

Main responsibilities of the Sumitomo Electric Group

Basis for Management

Outline of the stakeholder
For us, central and local governments
around the world are not only regulators
but also customers of our products andservices.

28

CSR Management

eﬀorts to achieve the target of becoming a "Glorious
Excellent Company." In consideration of the growing social
demand for CSR activities, I presume that it is now thetime to examine how to communicate with stakeholders
such as the explanation of our initiatives in a morecomprehensible manner.
The overall concept diagram of the mid-term management

Based on the tenets of
the Sumitomo Spirit, we aim to reacha higher stage with business activities
and CSR activities as the two pivotal
components of our corporate management.
Tetsuya Tohno General Manager, Corporate Planning Department

plan VISION 2022 presented below clearly shows ourstance to fulﬁll corporate social responsibility throughbusiness activities. We have also incorporated SDGs into
VISION 2022 in order to inform various people in Japanand overseas of the ideal state for the Sumitomo ElectricGroup to be achieved by 2030.
The businesses of our group, which focus on materials
and parts, are classiﬁed into the category of the so-called
B-to-B business. This gives us an advantage that we do nothave to be excessively aﬀected by trends but can

The purpose of commercial enterprises is to create value
and make proﬁts through business activities. However,there has been growing recognition that society may not
be maintained only with it, partly due to a recent increase
in awareness of social issues. In response to such social
demand, it is important to position CSR as one of the two
key components of the management strategy based on aview that companies should make proﬁts and help
overcome social challenges in parallel through businessconcentrate on identifying the essence. Still, instead ofbeing satisﬁed with it, we would like to be a company
that considers what value should be provided beyond"B-to-B," namely customers, society and stakeholders ("Bto B to C and S").
We at the Sumitomo Electric Group will strive to achieve
the goal of becoming a Glorious Excellent Company bycombining all forces across the Group worldwide on bothaspects of "Glorious" and "Excellent."

activities.
Setting the Sumitomo Spirit as a basis for the entire group,
we have already promoted CSR activities as part of our

CSR Basic Policy
The Sumitomo Spirit, which gives top priority to social
credibility and corporate ethics, is deeply instilled into theSumitomo Electric Group. With the Sumitomo Spirit, as wellas the Sumitomo Electric Group Corporate Principles, serving
as the basic value standards that guide us, we will enhance
our eﬀorts for CSR management, communication withstakeholders and human rights while setting governance, risk
management and compliance as the foundations. Then,through business activities based on them, we will createsocial values and contribute to a better society andenvironment.
In accordance with the establishment of VISION 2022 inﬁscal 2018, we revised part of the CSR core categories. With"quality," "supply chain," human resources," "environmental
preservation" and "social contribution" as the new ﬁve core
categories, we will promote business activities.
We will fulﬁll our corporate social responsibility and establish
good relationships with stakeholders with the aim of
becoming a Glorious Excellent Company, i.e., realizing theideal state of the Sumitomo Electric Group.

29 CSR Report 2019

Five CSR
core categories

Basis for Management

CSR Core Categories, Priority Themes and Main Targets
current level to 3.6 trillion yen under VISION 2022. It is

the CSR core categories and priority themes as presented

actually challenging to set and declare quantitative CSR

below and also set main targets including new key

targets amidst accelerating market changes. Still, with theperformance indicators for fiscal 2022 in a way to link themrecognition that CSR activities are one of the two key

to VISION 2022, instead of setting separate targets for eachcomponents of our management strategy and are essential tofiscal year.

becoming a Glorious Excellent Company, the ideal state of

We aim to further increase our net sales by 20% from theour group, we will enhance our efforts to meet the targets.

Core categories

Main targets (including KPIs for ﬁscal 2022)

Quality

Product quality &product safety

Reduce the index for the number of complaints※
by 30% from the FY2017 level

Supply chain

Promotion of
CSR procurement

Promotion of CSR procurement covering
the suppliers that represent 90% of
the value of our domestic procurement
Promotion of appointment and development
of SEG Global Executives

Promotion ofdiversity andoccupational safety

Serious accidents + Accidents resulting in remaining disabilities: 0
Accidents resulting in lost work time + No lost work time accidents+ Accidents causing minor injury: 23 or lessGroup's CSR Activities

Human
resources

Main related SDGs

Governance

Priority themes

Business Outline

In line with the announcement of VISION 2022, we revised

Accident score※＊: 80 or lessPrevention of
global warming

Socialcontribution

CSV＊ activities andsocial contribution
activities

Achieve no increase in CO2 emissions fromthe FY2017 level
Maintain and expand the projects that
help solve social problems

Core
Category

Environmental
preservation

Enhance the activities of
the SEI Group CSR Foundation

Sumitomo Electric Group CSR Promotion System
In July 2004, Sumitomo Electric established the CSR Committee, whichadministration and comprised by the managers of the departments in

2. Promoting internal and external information
disclosure and public hearings on CSR.

charge of CSR-related areas. The Committee set up CSR Promotion
Office as its secretariat in July 2010 and conducts its activities as a

3. Promoting CSR education programs throughout the
Sumitomo Electric Group, etc.

cross-sectional organization to promote CSR initiatives in the Sumitomo
Electric Group under the system shown in the figure below.

External disclosureManagement Conference: Deciding CSR basic policy

Public hearing function

Report on objectives and results

Instructions and guidance

Department in charge

ComplianceRiskmanagement

Compliance &Compliance &Risk Management
Risk Management
Oﬃce
Oﬃce
Information
Legal Dept.
Systems Div.

Public Relations
Dept.
IR Oﬃce,
Accounting Div.

Supply Chain

Quality
Quality Management Div.
Safety & Environment Dept.
Logistics Management Dept.
Information Systems Div.

Sales Planning & Marketing Div.
Business Units
Departments in charge of planning and administration

Procurement
Div.

Human Resources
Development Dept.
Plant & Production
Systems Engineering Div.
Safety &Environment Dept.

Target and achievement report

Employees

Glossary ＊Accident score

Environmental
Preservation

SocialContribution

Human Resources Div.

Social Infrastructure Sales & Marketing Unit/
Electronics Sales Unit

Public hearing function

Human Resources

An accident score is calculated by weighting the accidents that have occurred by type.
Class 1: Accidents that can result in a serious accident (forklifts, hoist cranes, rotatingparts, moving parts, etc.); Class 2: Accidents caused by an edged tool, jig or device;
and Class 3: Falling accidents, collides while walking, backache, etc.

Safety &Environment Dept.
Logistics
Management Dept.

Administration
Div.

Environmental
Preservation

Promotion and education ofbusiness philosophy and visions

Five core categories

Information
disclosure

Human Resources

Category

CSR Committee : Promoting business philosophy and visions, compiling the results of CSR activities and disclosing information inside and outside the Company

Supply Chain

Society (stakeholders)

Quality

1. Holding semiannual meetings to review the CSR
activities from a group-wide perspective and give
support and guidance on the future development.

is chaired by the officer in charge of personnel and generalSocial Contribution※ The target announced in 2018 has been revised in accordance with the introduction of a new target indicator "accident score."

Support and guidance

Sumitomo Electric Group companies＊CSV: Creating Shared Value

CSV is a concept advocated by Michael E. Porter, an American
academic specialized in corporate competitive strategies, as aframework for the business strategy that aims to balance the economic
activities of companies to gain proﬁts with the creation of social value.

CSR Report 201930

Targets and Actual Results in Fiscal 2018 / Targets for Fiscal 2019
In the Sumitomo Electric Group, the departments in charge of the CSR core categories respectively set various annual targets for theachievement of the main targets mentioned in P30, prepare specific action plans based on the annual targets and work to achieve themautonomously. The table below shows the main targets and results in fiscal 2018 and targets for fiscal 2019 on the main initiatives in core
categories. To meet the targets, we will continue to promote the initiatives based on the PDCA (plan-do-check-act) cycle.
Core
Category

Targets for FY 2018

Priority Theme

Reduce the index for the number of complaints by 21% fromthe previous ﬁscal year

Results in FY 2018
Decreased by 3% from the previous ﬁscal year

Evalu
ation Page

△

49

○

47
〜
50

○

52

Conducted the survey targeting about 710 suppliers in Japan andoverseas
Interviewed 86 suppliers in Japan through a meeting or on-site
inspection and asked them to make improvement● Compliance training: Provided to 1,804 persons in Production Groupand Corporate Staﬀ Group and 13 persons in R&D Group● Inspected 19 overseas aﬃliates and gave instructions

○

51
〜
54

Newly appointed 7 SEG Global Executives
As of April 1, 2019, the total number of SEG Global Executives is 41.
● Promoted measures to develop SEG Global Executives

○

56

○

55
〜
56

△

66

○

65
〜
66

○

71

○

67
〜
73

○

33
〜
42

○

43
〜
46

○

43
〜
46

Supply chain

Quality

Continue to promote Own Process Quality Assurance Activities(ninth year)

Product Quality& Product Safety

Promotion of
CSR
Procurement① Company-wide development of important measures toprevent complaints② Company-wide development of the 3 points control of quality(development of procedures to promote quantitative improvement)③ Expansion of the results of the activities on practical themes④ Continuance of activities for company-wide dissemination(through the issuance of booklets, holding of exchange
meetings and other initiatives)① Disseminated the cause investigation results of major complaints
and measures to address them across the company andconducted an inspection to identify similar risks in the divisions② Involved 5 divisions in the model activities of "3 points control of
quality". Reduced the number of complaints by 42% on averagein the model divisions③ Conducted a total of 247 activities on practical themes in the entire company④ Held an exchange meeting for Own Process Quality Assurance
Activities twice a year. Added 23 cases of latest and usefulactivities to the collections of good practices and dissemination
the information across the company

Continue the promotion of CSR procurement covering the suppliers
that represent 90% of the value of our domestic procurement● Continuous implementation of the survey based on the CSR
procurement self-assessment sheet● Excluding Sumitomo Wiring Systems, Ltd. and the listed subsidiaries

Conducted the CSR survey covering the suppliers that represent
90% of the value of our domestic procurement

Continue to implement the training program that supports
compliance● Extend the application of the procurement guidelines tooverseas aﬃliates●●●

Appointment of new SEG Global Executives
Promotion of measures to develop SEG Global Executives

Human resources

Priority items● Continuance of promotion of the talent management cycle● Further activation of Regional Executive Conferences andArea Committee activities● Continuance of the executive training program

Promotion ofDiversity andOccupational
SafetyReduce serious accidents and accidents resulting in remaining
disabilities to zero, and reduce the total number of accidents
resulting in lost work time, no lost work time accidents andaccidents causing minor injury to 38 or lessAccident score: 216 or less

●

●

●

●

Continued to conduct Business Unit HR Meetings
Continued to hold the Regional Executive Conference andenhanced Area Committee activities● Continued to hold the executive training program (with theparticipation of 2 SEG Global Executives)●●

Serious accidents + Accidents resulting in remaining disabilities: 0
Accidents resulting in lost work time + No lost work time accidents+ Accidents causing minor injury: 39
Accident score: 162

Implement priority items●

Safety VISION 2022
Safety measures in facilities
Development of human resources with high safety awareness
Fostering safety culture

●
●

●
●

●

●

●

Activities in each site
Priority safety activities●●●

Activities to be conducted continuously●Group-wide structural reinforcement activities
Emergency / priority safety management activities
Safety education Plant disaster prevention
Global safety diagnosis Group-wide sharing of best practices

●

●

●

●
●

Social contribution

Environmental preservation●●

Achieve no increase in CO2 emissions from the FY2017 level

Prevention of
GlobalWarming●●●

CSV Activities
and Social
Contribution
Activities●●

Achievement of the targets in all items of the Action ECO-22V campaign
Implementation of environmental audits
In Japan: Legal compliance audits
Overseas: Legal compliance audits (China, ASEAN, the US)
Continue the practical training, in which simulated diagnosis
is conducted using the actual products based on hiyari ornear-miss reports and past audits●

Reduced accidents that can result in a serious accident
Provided new training programs on a trial basis, which were allreceived well
Disseminated the slogan "All accidents can be eliminated"
Continuously conducted voluntary inspection
Continued 1-2-3 activities and developed S-T-O-P accident campaign＊Continued to implement both emergency / priority safety
management activities (similarly to the development of humanresources with high safety awareness)
Started to strengthen the supervision of construction work
Completed activities with follow-ups
Conducted interdivisional meetings

Reduced CO2 emissions by 2.2% from the FY2017 level●●●

Out of the 9 items, the performance achieved the targets for 7
items; the performance failed to achieve the targets for the
reduction of CO2 per unit of sales in logistics and Eco-products
In Japan: Conducted at 8 sites
Overseas: Conducted at 5 site (Indonesia, Thailand and the US)
739 persons participated in managerial post-based training

Maintain and expand the projects that help solve social
problems

See the articles from P33

Enhance the activities of the SEI Group CSR Foundation

Enhance the activities of the SEI Group CSR Foundation

Implement the following fund projects① Monetary contributions to university courses: 113 million yen② Subsidies for academic and research programs: 30 million yen③ Supply of scholarships: 43.7 million yen● Promote partnership and cooperation with nonproﬁtorganizations (NPOs) for the support the reconstruction of the
Tohoku Region and other initiatives●●

Implement the following fund projects① Monetary contributions to university courses: 108 million yen② Subsidies for academic and research programs: 35.7 million yen③ Supply of scholarships: 40.9 million yen

Legend ◎: Target achieved and performance far exceeding the target by more than about 50%; ○: Target achieved; △ : Target not achieved (performance improved from the previous ﬁscal year);▽ : Target not achieved (performance similar to that in the previous ﬁscal year); ▼ : Target not achieved (performance deteriorating from the previous ﬁscal year)

Glossary ＊S-T-O-P Accident Campaign

31 CSR Report 2019

This slogan represents basic rules to be followed while walking. S: Do not take a ｓhort cut and watch your step; T: Do not ｔext or ｔalk on thephone while walking; O: Hold on to the handrails when using stairs; and P: Do not put your hands in your pocket while walking

Targets for FY 2022

Reduce the index for the number of complaints by 16% from the previous
ﬁscal year

Basis for Management

Targets for FY 2019

Related SDGs

Reduction of the index for the number ofcomplaints by 30% from the FY2017 level

Business Outline

Continue to promote Own Process Quality Assurance Activities(tenth year)① Company-wide development of important measures to prevent majorcomplaints (continued)② Company-wide development of the 3 points control of quality(continued)③ Expansion of Own Process Quality Assurance Activities on practical themes(continued)④ Continuance of activities for company-wide dissemination (through theissuance of booklets, holding of exchange meetings and other initiatives)●●●

Promotion of CSR procurement covering the
suppliers that represent 90% of the value ofour domestic procurement (Note 1)

Continue to implement the training program that supports compliance
Extend the application of the procurement guidelines to overseas aﬃliates

Appointment of new SEG Global Executives
Promotion of measures to develop SEG Global Executives

Group's CSR Activities●

GovernanceContinue the promotion of CSR procurement covering the suppliers that represent
90% of the value of our domestic procurement● Continuous implementation of the survey based on the CSR procurement self-assessment sheet● Expansion of the scope to include Sumitomo Wiring Systems, Ltd., Sumitomo RikoCompany Limited and Nissin Electric Co., Ltd.

Promotion of appointment and development
of SEG Global Executives

Serious accidents + Accidents resulting inremaining disabilities: 0

Implement priority items

Accident score: 80 or less●Social Contribution

Reduce serious accidents and accidents resulting in remaining disabilities tozero, and reduce the total number of accidents resulting in lost work time, nolost work time accidents and accidents causing minor injury to 36 or less（Note 2）
Accident score: 142 or less（Note 2）Core
Category

Implement priority items● Continuance of promotion of the talent management cycle● Further activation of Regional Executive Conferences and Area Committee
activities● Continuance of the executive training program

Accidents resulting in lost work time
+ No lost work time accidents+ Accidents causing minor injury: 23 or less

Safety VISION 2022
Safety measures in facilities
Development of human resources with high safety awareness
Fostering safety culture●●●

Quality●

Activities to be conducted continuously with the participation of all employees
Recognition of problems by top management S-T-O-P accident campaign
Activities to comply with rules and standards

●

●

●

●

Group-wide structural reinforcement activities
Emergency / priority safety management activities
Safety education Plant disaster prevention
Global safety diagnosis Group-wide sharing of best practices

●
●
●

●

●

No increase from the FY2017 level●●

Achievement of the targets in all items of the Action ECO-22V campaign
Implementation of environmental audits
In Japan: Continuance and completion of the second round of legal
compliance audits
Overseas: Legal compliance audits (China)
Continue the practical training, in which simulated diagnosis is conducted using
the actual products based on hiyari or near-miss reports and past audits
Maintain and expand the projects that help
solve social problems

Enhance the activities of the SEI Group CSR Foundation

Enhance the activities of the SEI Group CSRFoundation

Human Resources

Maintain and expand the projects that help solve social problems●

Supply Chain●

Achieve no increase in CO2 emissions fromthe FY2017 level

Implement the following fund projects(Note 1) Domestic procurement by Sumitomo Electric and its domestic aﬃliates (excluding Sumitomo Densetsu Co., Ltd.) is covered.
(Note 2) The ﬁgure is diﬀerent from that mentioned in P66 because the target was set with the Sumitomo Wiring Systems Group excluded.

CSR Report 2019

Environmental
Preservation① Monetary contributions to university courses: 108 million yen② Subsidies for academic and research programs: 30 million yen③ Supply of scholarships: 40 million yen

32

CSR Core Category

CSR Priority Theme

SocialContribution

CSV Activities andSocial Contribution Activities

Since its foundation as a manufacturer of copper wires and cables, Sumitomo Electric Group has continuously grown throughthe development of related materials and manufacturing technologies and celebrated its 120th anniversary in 2017. Basedon the Sumitomo Spirit, we will continue to create a large number of technologies and products that help solve social
challenges and contribute to a better society and environment.

Energy Infrastructure
Redox Flow Battery

Concentrator Photovoltaic (CPV) System

Power Line Communication (PLC)

High-temperature
superconducting (HTS)Information andCommunication Infrastructure
10G-EPON system

Public Infrastructure
POREFLON™ membrane-separation
wastewater treatment module

Air springs for vehicles

33 CSR Report 2019

DC XLPE insulation cable

Ultra-low-loss optical fiber（Z-PLUS Fiber™）
Basis for Management
Business Outline

Automotive/Transportation
High-strength aluminum wiring harness

Tab-Lead for on-vehicle batteries
GovernanceHigh durability prestressing strands

Group's CSR Activities

CELMET ™(porous metal)

Sintered parts

Core
Category
Social Contribution
Quality

GaN transistors forcellular phone base stations

Multicore optical fiber cables

Supply Chain
Human Resources

Traffic control systems

Environmental
Preservation
CSR Report 201934

CSV Activities
Basic Approach

To meet such social demand and fulfill our corporate social

In addition to monetary donations and charitable
activities, we will continuously be committed tothe creation of shared value (CSV) throughbusiness activities.

(Creating Shared Value) activities" as a theme of "social

The business activities of the Sumitomo Electric Group arevery wide-ranging in terms of technology, market andresponsibility, the Sumitomo Electric Group added "CSV
contribution," one of the CSR core categories that werereviewed in fiscal 2018, along with the conventional theme of"Contribution at business locations and through thefoundation" to make them two pillars for making social
contribution.

business, involving various stakeholders. Our group has
always supplied useful products, technologies and services tosociety through business activities and promoted CSV

Relevance to the SDGs

activities based on our CSR basic policy. We will contribute

The picture below illustrates the values offered by theto a better society and environment through a proactive andautonomous commitment to solving social challenges andcontinuous supply of new value to society while always being
conscious of our role as a member of society.

Re-definition of the Priority Theme"Social Contribution"
While there are a host of global problems including global
warming today, companies are required to develop businessactivities that consider the environment and help create asustainable society. In addition, a wide range of measures aretaken to solve social problems on a global scale andcompanies are expected to help solve global issues throughtheir business activities. In 2015, the Sustainable
Development Goals (SDGs) were adopted at a UN summit.
An international framework where private companies, as wellSumitomo Electric Group for the development of a societythat is projected around the year 2030 in VISION 2022.
Widespread use of IoT technologies, the introduction ofsmart energy networks and connection of electrified vehicles
and various other things will generate new services. Thesechanges will also allow people to live a safe, prosperous andcomfortable life with a sense of security in a sustainable
manner around the world, according to our estimate. We
have specified three forms of the ideal society we seek insuch a future world, as well as nine fields for our initiatives tooffer values for the society. Those values we offer are also inline with the SDGs.
While some of the initiatives are expected to be fullycommercialized and contribute to the performance of theSumitomo Electric Group only after fiscal 2022, we plan topromote them to respond to social changes proactively
during the period of this mid-term management plan.

as national governments and NGOs, can assist in solving the
problems has been developed and many companies are now
engaged in the activities.

Relevance of the business of the Sumitomo Electric Group to the SDGs

35 CSR Report 2019

R&D Group(Number of patents)
18,000Industrial Materials

16,00014,00012,000179

Electronics

33
182

10,0008,000

FY201815,954 15,601 16,698
8,129

6,824

7,030

7,067

7,611

7,449

7,064

7,621

8,014

8,343

8,152

8,569

2013

2014

2015

2016

2017

2018 (Fiscal year)

6,000¥129.6billionin total

15,081
13,888 14,651

Business Outline

84

Environment &EnergyBasis for Management

Number of Patents Year by YearR&D cost by business segment

4,000
2,000

819

0

Automotive

In other countries

Infocommunications●●

Figure as of December 31 of each year
The ﬁgures in Japan are the total number of patents, utility models and designs.
The ﬁgures in other countries are the sum of the total number of patents,
utility models and designs in each country.

Governance●

In Japan

VISION 2022 Mid-term Management Plan:

By combining the core technologies we have developed withincluding SDGs, our R&D Group will work for various

advanced IoT, AI, computational science, analysis techniques

innovations such as drastic changes in automobiles, theand security, we will promote the development of new

widespread use of renewable energy and the use of big data.

products and new businesses.

We will pursue the growth of our businesses in Mobility, Energy

Furthermore, looking at a future society, we will make efforts

and Communications as well as the products and services thatto develop innovative technologies that are expected to bringunderpin them while taking advantage of the diversity of ourmajor social reforms such as carbon wires, hydrogen energy

businesses and technologies to create innovations and thereby

and innovative materials.

Core
Category

To meet new needs on social and environmental aspects,

Group's CSR Activities

Research and Development for the Next Generation

contribute to the creation of a better society.

Social Contribution
Quality
Supply Chain
Human Resources
Environmental
Preservation
CSR Report 201936

Automotive
The automotive industry is facing an era ofonce-in-a-century change. We will work for the future withthe technology and reliability that we have established.
It is said that the automotive industry is facing an era of once-in-a-century change.
For automated driving, which is part of the change, vehicles need to have newfunctions such as cameras that serve as the eye of the vehicle and an ability to
download high-precision maps from the server. To this end, it is essential toestablish a high-speed communications network that allows various information to
be integrated inside a vehicle. We at AutoNetworks Technologies are committed
Wiring harness

to the development of on-vehicle Ethernet electronic control units (ECUs), which
serve as the hub of ECUs that function to communicate a large amount of data athigh speed in such next-generation vehicles.
European car manufacturers are currently taking a lead in this field, followed by
Japanese manufacturers. The Sumitomo Electric Group has worked to develop
high-quality networks that can function continuously 24 hours a day, 365 days ayear in products for major telecommunications carriers. Based on the technology
and reliability, we continue to conduct research activities to support theinnovations of on-vehicle network
infrastructure.
The market for products related toautonomous car is still in its
infancy. It is expected that theAnti-vibration rubber products

market for the products related to
on-vehicle Ethernet will further
grow in the future. As the project
leader, I will work to ensure that
we maintain a presence in this field,
in which absolute safety andsecurity must be provided, by
continuously making use of thetechnological capacity andflexibility that our group has
developed.

Charging connector for EVs

Social challenges
Traﬃc accidents● Traﬃc jams●

Social expectations●

Realization of automated driving

New products and technologies contributing
to the solution of the challenges● Technologies that allow
high-speed, high-capacity
telecommunications in a vehicle

37 CSR Report 2019

Takeshi Hagihara

Senior Manager, Communication Technology R&D
Department, Information Network R&D Division
AutoNetworks Technologies, Ltd.

On-vehicle Ethernet ECU, which supports high-speed,
high-capacity telecommunications
A vehicle is equipped with a large number of electronic control units (ECUs). An
on-vehicle Ethernet ECU connects those ECUs to serve as a communication basestation that arranges the exchange of information. At the beginning of the electronic
control of vehicles, ECUs were connected separately to individual switches andsensors to control the target devices. Later, as the functions of a vehicle increased,some related ECUs were linked to form a network. A vehicle is equipped with many
ECUs and the number reaches 100 in some vehicles these days.
The on-vehicle Ethernet ECU manages the information communicated between
the ECUs in an integrated manner toallow them to share the information. Thisis a very key product for information
communication. The development oftechnology for the product is essential
for the high-speed , high-capacity
telecommunication inside a vehicle
required for the commercialization ofself-driving technology in the future.

Infocommunications
Basis for Management

We support the integration of broadcasting technology
and information communication withadvanced technology.

Business Outline

Sumitomo Electric started to develop and commercialize internet protocols (IPs)and set-top boxes (STBs) for business use around 1997. Then, we supplied STBs
that support video distribution services of major communications carriers. Sincearound 2008, we have provided STBs compatible with the retransmission services
and standards for IP terrestrial broadcasting, and now supply 4K-STBs forhigh-precision 4K broadcasting services. We also supply STBs to cable televisioncompanies across Japan via major communication carriers. In April this year, we
released an STB that supports BS4K broadcasting. The STB for cable television

Governance

Multicore optical ﬁber cables

companies is a hybrid type that can be used for both IP and RF broadcasting. With
Android TV™ built in, this product can be operated by a voice to further improvethe convenience.
Our department plans to develop IP-STBs in preparation for a full shift to IP
broadcasting in the future. One of the features of IP-STBs is that terrestrial digital
broadcasting and BS4K broadcasting can be watched via a broadband IP network

Group's CSR Activities

even in mountainous and otherareas where it is difficult to viewground and satellite broadcasting
due to poor television reception.
I joined the company as a
Optical transceivers

mid-career employee in 2007 andhave engaged in projects for theplanning and development of STBs.

Core
Category

We will continue to supply highly
functional STBs that can be used ina simple and user-friendly mannerSocial Contribution

by effectively using voice searchand voice operation based on theinteractivity of IPs and features ofAndroid TV™.

Atsushi Takagi
Broadband network service products

Social challenges●

Social expectations●

New products and technologies contributing
to the solution of the challenges●

major communication carriers. This model supports BS4K broadcasting andcan be used by many cable TV operators because it supports BS and BS4K
trans modulation systems and pass-through systems. Equipped with a triple

tuner, this product can record up to two programs simultaneously while
another cablecast programis being watched. It alsooffers a comfortableviewingenvironment

with Google Assistantsupported to enable voicecommand and eliminate

the need for operation witha remote controller.

Environmental
Preservation

Cable television that supports
BS4K broadcasting

Cable Plus™ STB-2 is supplied to cable television companies across Japan via

Human Resources

Establishment of a comfortablebroadcast reception environment
for everyone

Set-top box supporting BS4K broadcasting Cable Plus™ STB-2
Supply Chain

Areas where it is diﬃcult to viewterrestrial and satellite
broadcasting

QualityGroup Leader System Planning GroupVideo Products Department
Broaed Networks Division* Android TV is a trademark of Google Inc.

CSR Report 201938

Electronics
Satellites are also entering the era of the all-electric type.
We are developing GaN HEMT that helps reduce
their size and weight.
Used for various purposes including GPS and other navigation systems as well as
observation and communications, satellites are essential for modern society. In
recent years, their size and weight have been reduced and all-electric satellites,
which require no solid or liquid fuel, have been more widespread. The rockets
used to launch satellites are also required to be smaller, lighter and more powersaving to reduce the cost.
Flexible printed circuits (FPC)

We at Electron Device Division developed gallium nitride high electron mobility
transistor (GaN HEMT) to be mounted in satellites. This product helps produce
high-output power amplifiers that are smaller, lighter and more power saving thanconventional waveguide devices and thereby reduce the size and weight ofsatellites and rockets. GaN HEMTs are also used in synthetic-aperture radars,
which are effective in various earth observation missions such as the investigationof impact of natural disasters and global warming on forests.
Our GaN HEMTs meet all quality
and reliability requirements forapplication to satellites and has
already been used in satellites on
the orbit.

SUMITUBE TM

I have been involved in thedevelopment of GaN HEMTs forsatellites for about three years.
When I see news of the launch of asatellite equipped with our devices,
I recognize the significance andachievement of our job and feelgreatly rewarded.

Tomio Sato

General Manager Electron Device Development Department
Electron Device Division
Sumitomo Electric Device Innovations, Inc.

SUMI-CARD TM

Social challenges
Low resolution of location accuracy● Changes in the global environment
due to global warming●

GaN HEMTs to be mounted in satellites,
which helps reduce their size and weight
Gallium nitride (GaN) is one of the compound semiconductor materials, so

called wide band-gap semiconductors. GaN HEMT, made of this material, hashigh breakdown voltage and can realize high output-power amplifiers. SuchSocial expectations●

Cost reduction by making
satellites smaller and lighter

high output-power amplifiers are now practically used for high-frequency radio
communications systems and radar systems. Sumitomo Electric Group has
developed GaN HEMTs to be

mounted in satellites, where
both high performance andNew products and technologies contributing
to the solution of the challenges●

GaN HEMT to be mounted insatellites

39 CSR Report 2019high reliability are required.

They are widely used in various

satellites for global positioning
systems, earth observation orcommunication.

Environment & Energy
Basis for Management

Our low-loss high-capacity conductors drastically reducetransmission loss.We will help reduce CO2 emissions
from power generation all over the world.

Business Outline

Overhead conductors are mounted on steel towers to convey high-capacity,
extra-high-voltage power as electric power transmission lines. How to reducetransmission loss caused by the electrical resistance of the transmission lines is achallenge in the efforts to save energy and create a low-carbon society.
It is said that transmission loss from the cable that occurs between the power plantand demand areas accounts for approximately 5% of the total loss. Therefore,
Copper wire rods

measures to handle the transmission loss are also important for the reduction of CO2
emissions from power generation. The low-loss high-capacity conductors developed

GovernanceAluminum wire rodsby Sumitomo Electric have the maximum aluminum area as current carrying portion,
thereby reduce transmission loss by roughly 25%. The maximum aluminum area isrealized by a combination of the smaller area of steel core, which has been achievedby using extra high-strength aluminum-clad steel that is 1.3 times as strong as
conventional materials, and trapezoidal aluminum wires, tightly placed without gap.
In addition, while the high-strength steel core was traditionally galvanized, which doesGroup's CSR Activities

have enough corrosion protection
and caused a problem of corrosion
between steel and the aluminum
wires, our aluminum-clad steel corehas higher corrosion protection to
High-voltage optical ﬁber composite submarine cables

prevent the corrosion of conductor
and can extend its life.
This product helps reduce CO2

Core
Category

emissions from power generation
over a long period. In July 2019, thestringing work in Habarana-Veyangoda,

Social Contribution

Sri Lanka was finally started. This is thefirst large overseas project using the
low-loss high-capacity conductors.
We hope that we can continuously
c o n t r i b u t e t o society w i t h o u r
products used i n overhead

Social challenges

Social expectations

New products and technologies contributing
to the solution of the challenges

Low-loss high-capacity conductors

CSR Report 2019

Environmental
Preservation●

For overhead transmission, aluminum conductor steel reinforced (ACSR), in which
aluminum wires are stranded around a steel core, are widely used. Sumitomo
Electric has developed low-loss high-capacity conductors with the combination of asmaller diameter of steel core, which is covered with aluminum, while increasing
the aluminum area by tightly placing trapezoidal aluminum wires without gap
around the core. As a result, while maintaining the similar outer diameters andtensile strength compared to conventional ACSRs, our new conductors have
reduced electrical resistance and thustransmission loss by approximately
25% compared to conventional ACSRs.
In addition, our conductors adopting
thermal-resistant aluminum alloys havepower capacity of about twice that ofconventional ACSRs, which enables the
conductors to serve as a backup in an
emergency to contribute to the further
improvement of the reliability of thewhole transmission lines.

Human Resources

Construction of low-loss
transmission networks● Reduction of power generation to
curb CO2 emissions●

Low-loss high-capacity conductors that reducetransmission loss by approximately 25%
Supply Chain

Loss in power transmission● CO2 emissions from power generation●

Assistant General Manager Foreign Activity GroupEngineering Department
Overhead Transmission Line Division

Quality

Magnet wires

transmission lines around the world.

Tomohiro Kagami

40Industrial Materials
We will further expand our tungsten recycling business
to use more recycled materials.
A.L.M.T. Corp. in the Sumitomo Electric Group deals in powders and hard metals,
tungsten/molybdenum products, heat spreaders and Precision diamond products.
The

company has four production bases in Japan and also expands overseas

operations. We at Powder and Hard Metal Division manufacture tungsten powder
and other items.
Tungsten is designated by the Ministry of Economy, Trade and Industry of Japan as
one of the five priority rare metals to be recycled. Since approximately 80% oftungsten is supplied by China, its national policy influences the market.
Cutting tools

Accordingly, we began research on tungsten recycling in 2007 and launched it as abusiness in 2011. Tungsten is a raw material of cemented carbide (composite
material of tungsten carbide and metallic cobalt), which is mainly used in cutting,drilling and other tools. With the cooperation of many customers in Japan, we
have established an efficient system to collect used cemented carbide tools
through collection boxes. In Japan, which produces no tungsten, this recovery
system will become more important in the future.
While the ratio of tungsten in natural ore is only 1% or less, the ratio in the used
cemented carbide tools, which arecollected in this recycling business,
is more than 80%. By developing
innovative technology for molten

Sintered parts

salt smelting, we have also reduced
energy consumption in the process
to produce tungsten powder byrecycling. We will continue toresearch tungsten recycling
technologies and work to expand
the business for a more stablesupply and an increase in the
supply of recycled materials.

Fumiatsu Sato, Section Manager (left),
Takehiko Hayashi, General Manager (right),
Engineering Department

Takahisa Iguchi, General Manager (center),

RM Engineering OfficePowder & Hard Metal Division, A.L.M.T. Corp. (Toyama)

Prestressed steels

Social challenges●

Shortage of rare metals

Social expectations●

Use of recycled rare metals

Establishment of a system to recycle tungsten
In the Sumitomo Electric Group, in addition to Toyama Works of A.L.M.T. Corp.
presented above, Sumitomo Electric Hardmetal Corporation in Ono, Hyogo
Prefecture and Niagara Refining LLC in the suburb of Buffalo, New York, U.S.
respectively operate their unique tungsten recycling businesses.
In 2014, Sumitomo Electric, jointly with a Japanese automotive manufacturer,
received a Rare Metal Recycling Award at the Resource-Recycling Technologies
and Systems Award 2013 Ceremony, which was organized by the Japan
Environmental Management Association for Industry, in recognition of thedevelopment of the tungsten recycling system from used cemented carbide tools.

New products and technologies contributing
to the solution of the challenges●

Establishment of a rare metal
recovery system

Used cemented carbide tools

41 CSR Report 2019

Tungsten powder

New Business Development
Basis for Management

We will provide products and technologies forthe new human-oriented society ("Society 5.0") tomake it safer and more secure.

●

Improvement of the quality of life
Extension of healthy life expectancy●

Improvement of motor function
with a walking monitoring system

CSR Report 2019

Environmental
Preservation

One of the current social problems is locomotive syndrome, which is a decline
in locomotor function due to the deterioration of the motor system includingbones, joints and muscles. Sumitomo Electric has developed and released "Q'z
TAG™ walk," a product that visualizes walking, which is the most basic
movement, to help prevent locomotive syndrome and improve motor function.
The measurement is easy;
you just have to prepare
this dedicated sensor of
approximately 15 g alongwith a PC or tablet withthe dedicated software
installed and walk 10 m
there and back. It is
expected that the tool
helps many peoplecasually maintain andimprove their health.

Human Resources

New products and technologies contributing
to the solution of the challenges

Walking monitoring system "Q'z TAG™ walk"
Supply Chain

Social expectations●

Life Science Development Division

Quality

Response to the aging society

Social Contribution●

Core
Category

Social challenges

and medical practice in the future.

Group's CSR Activities

Lithium-ion power storage system

Governance

POREFLON™

Business Outline

Magnesium alloy

Life Science Development Division, which was set up in 2014, currently operates in thetwo fields of medical equipment and health/nursing care. We developed Q'z TAG™
series, which are walking monitoring systems, and placed them in the market as our
first products in the health/nursing care field.
Middle-aged and elderly people can fall more easily due to a decline in muscle
strength, which may cause a fracture and make them bedridden. Such a risk grows as
the aging of population advances. Our Q'z TAG™ analyzes the lateral balance,
longitudinal movement and other data in the walking form of a person with anaccelerometer and feeds back the data. They can be used for fall prevention,encouragement of patients to rehabilitate injuries, etc.
While the main customers are currently nursing care facilities, we are expanding the
distribution channel to introduce them to general companies as a tool to improve thehealth of middle-aged and elderly people in response to the growing demand for
health and longevity.
In the Sumitomo Electric Group, which mainly operates B-to-B business, this is a rarebusiness model in that the establishment of channels to sell products to customers is
also considered with focus on B-to-C
business and that the staff members
are also in charge of planning formarket development. Accordingly,
we will engage directly withcustomers and aim to provide
products that flexibly incorporate
their needs.
In a future society, all people andthings will be connected with the IoT
and each person will be able to feel
comfortable and play an active role.
While Sumitomo Electric has
contributed to the construction ofKoichi Fujimoto, Section Manager (center),social infrastructure, we would also
Sales and Marketing Group
like to help people have a safe andShinobu Hotta, Assistant Manager (left),Engineering Groupsecure life through the development
Satoshi Yasui, Section Manager (right), Engineering Groupof products that support nursing care42

Social Contribution Activities
We value exchanges with local people for the growth of
the Works together with them
Sumitomo Electric is committed to various activities to support local communities.
Yokohama Works invites family members of its employees and local people to Inari
Festival, which is held to celebrate our foundation anniversary on the ﬁrst Sunday of April.
The participants have increased year by year and approximately 1,700 people join thefestival nowadays. The main event is an ekiden race. Cherry blossoms on the premises
usually bloom around the date of the festival and we oﬀer access to our cafeteria tovisitors so that they can enjoy a cherry blossom viewing picnic. We also organize asummer festival, in which music band performance and a "B-grade gourmet" fareare popular. In addition, as a tool for communication with local people, we issue"Sumiden Yokohama Dayori" (newsletter) twice a year. About 10,000 copies are
distributed each time and the 20th issue was released in July 2019.

Yokohama Works also organizes a factory tour for students of nearby
elementary schools to give them an opportunity to learn what products are
manufactured there. The other day, students who joined the tour madepresentations in an event held at their school on the subject ofneighborhood exploration. We were very pleased that they introduced(From left)

our S-T-O-P accident campaign. We

Hiromi Kato, Senior Assistant General Manager
Masanori Sugawara

will continue to attach importanceto various exchanges with the

Administration Group

local community and makeRyota Ochiai
Takao Watanabe, Assistant Manager

eﬀorts to ensure thatYokohama Works can grow

HR Group

together with local people.

Yokohama Works

Basic Policies on Social Contributions

Social Contribution through Donations

Sumitomo Electric stipulated the Sumitomo Electric GroupWe are making social contribution through donations
from a global perspective

Basic Policies on Social Contributions, which are based on
the Sumitomo Spirit and the Sumitomo Electric Group
Corporate Principles, on the occasion of the 110th
anniversary of its founding in 2007.

The Sumitomo Electric Group Basic Policies
on Social Contributions
The Sumitomo Electric Group will proactively address voluntarysocial action programs, as a member of society, focusing on
respect for human resources,
attaching importance totechnology, and creating a better society and environment inaccordance with the Sumitomo Spirit and the Sumitomo ElectricGroup Corporate Principles, as well as widely contributing tosociety through its business activities, including the provision of
products, technologies and services that beneﬁt society.
● Globally promote eﬀorts toward the development of humanIn fiscal 2018, we made donations in various areas including
schools and education, industrial and academic development,
R&D, art and culture, welfare, local development,
environmental conservation and sports. For example, we gave
financial support to symphony orchestras and opera
performance as part of our efforts to assist art and culturalactivities, as well as important social activities such asenvironmental conservation by nature conservation funds andother organizations.
We also collected matching gifts＊ from employees to make adonation to the Japan Committee for UNICEF, the Japanese
Red Cross Society and WWF Japan. In addition, we donatedrelief money for the areas affected by natural disasters. We
thus developed a wide range of social contribution activities.
Amount of Donations by Category (Sumitomo Electric alone)
Total 376,689,927 yen

resources, the promotion of research and learning andenvironmental conservation.

● Promote community-oriented social contribution activities in the

The SEI Group CSR Foundation

Group's business locations all over the world.

Other 194,029,809 yen

182,660,118 yen● Provide continuous support to employees' voluntary social

Industrial and academic development,
research and development 40,815,064 yencontributions.

Welfare projects 43,136,286 yen

Sports, arts and culture 32,050,000 yen

contribution activities suitable for the Sumitomo ElectricGroup, which is aiming to be a

Glorious Excellent

Company. These activities include the establishment of the
SEI Group CSR Foundation as a vehicle to contribute toencouragement of research and learning activities and humanresource development, as well as on donations, collaboration
with NPOs, support of volunteer activities by employees andpromotion of contribution to local communities.

1,000,000 yen

Other 5,980,000 yen

Amount of Donations by Year(thousand yen)

800,000

749,738

400,0000

500,000
2013

Accumulated endowment in the SEI Group CSR Foundation

216,582 245,042 271,069 259,941
2014

2015

2016

2017

376,6892018 (Fiscal year)(Note) We completed the accumulation of 2 billion yen of endowment of the fund, which was
the initial target, in 2013 and have donated fund for operation only since ﬁscal 2014.

Glossary ＊Matching gift system

43 CSR Report 201912,167,000 yen

Environmental conservation

Schools and education 58,881,459 yen

Under the Basic Policies, we are committed to the social

Local development

The company concurrently donates an amount equal
to the donation made by an employee in this system.

Basis for Management

CSR VOICE

Balance between my athlete life and social contribution activities

Naoka Miyake, Track&Field Team, Sumitomo Electric / Sumitomo Electric Intellectual Property & Technology Center, Ltd.

GovernanceContributions
to LocalCommunities

Business Outline

In addition to the development of industrial products through business activities, the Sumitomo
Electric Group is also committed to the development of ties and harmonious relations with thelocal communities through local contribution activities. One of the activities is the organization of
athletic lessons in Itami. The lessons in Noma Kindergarten are given every year, covering thebasics of running and the practice of relay races. I do my best to coach the children so that they
can fulfill their hope of running cool at the sports meet while also enjoying the coaching.
The track&field team members, including me, are always working hard to achieve good results internationally. There is nodifference between the children and the athletes in their desire to improve themselves as much as possible. In the athletic
lessons, I try to use simple words, as well as gestures, whenever possible. I believe that this initiative also helps themembers grow. Some of the children who participated in the athletic lessons may become athletes who play a leading rolein the track & field in the future. While also aiming to further improve my performance as an athlete, I would like tocontinue to contribute to the development of ties with the local community.

The Sumitomo Electric Group operates in more than 40 countries and regions around the world.
While respecting the culture and customs of every region and country, we are committed to various
Group's CSR Activities

activities to support local communities with the aims of contributing to the development of local
economy and society through business activities and building harmonious relations with them.

Contributions to Local Communities Activities in Japan
A total of 54 companies of Sumitomo Electric and its group companies are covered. They include Sumitomo Riko Company
Limited, Nissin Electric Co., Ltd. and Sumitomo Densetsu Co., Ltd., which are listed in stock exchange. The expenditure for our
corporate philanthropic activities was 517,420,000 yen.
※The amount is calculated based on the criteria mentioned in Attachment 2 "Examples of conversion into monetary value concerning the giving access to facilities andparticipation and dispatch of personnel" of the Survey on Corporate Philanthropic Activities in Fiscal 2017 by Keidanren (Japan Business Federation).

Core
Category

Promoting community support activities and exchange with local communities● Local cleaning activities, promotion of greening, environmental conservation activities, etc.

Social Contribution

Nissin Electric Co., Ltd.: Cleanup of the peripheral area of Kujo Works (three times a week), etc.

●

Cleanup activities are performed in 31 of the 54 companies including the company mentioned above.

● Support of local fire-prevention, anti-crime and traffic safety activities

A.L.M.T. Corp.: Watch for traffic safety at three locations of the entrance of the industrial complex,
the front gate of the facilities and the company's parking lot every month and other initiatives●

Performed in 20 of the 54 companies including the company mentioned above.

Quality● Opening corporate facilities (sports grounds, gyms, etc.) to the public

Sumitomo (SEI) Electronic Wire, Inc.: Opening gyms and tennis courts to local residents and other initiatives●

Performed in 7 of the 54 companies including the company mentioned above.

● Inviting local residents and students (from elementary, junior high and high schools) to plant tour

Sumitomo Electric Device Innovations, Inc.: Plant tours for the students of local junior high schools and highschools: 38 and 35 high school students in January and February, respectively●

Supply Chain

Performed in 10 of the 54 companies including the company mentioned above.

● Opening company sites to the public to organize event

Hokkaido Sumiden Precision Co., Ltd. and Hokkaido Electric Industries Ltd.: Jointly organized ShibazakuraFestival in May to receive about 1,800 visitors●

Performed in 6 of the 54 companies including the company mentioned above.

● Publishing local community magazines

Contributing to sports and cultural activities● Contributing to sports activities

Sumitomo Electric: Sponsoring the 74th Lake Biwa Mainichi Marathon in March 2019, organization of four athletic
practice sessions for Noma Kindergarten in Itami in July and September
Performed in 20 of the 54 companies including the company mentioned above.

Environmental
Preservation●● Contributing to arts and cultural activities

Sumitomo Riko Company Limited: Conducting the fourth competition of Sumitomo Riko Student Essay Award foruniversity students, international students and postgraduate students in Japan●

Human Resources

Osaka Works of Sumitomo Electric in July 2018 and January 2019, Itami Works in May and December 2018
and Yokohama Works in May and November 2018

Performed in 7 of the 54 companies including the company mentioned above.

CSR Report 201944

Supporting education and training● Offering a work experience program for students and practical trainnings for adults and other support

SEI Optifrontier Co., Ltd.: Offers a work experience program for students from schools for handicapped children
in June, October 2018 and March 2019●

Performed in 21 of the 54 companies including the company mentioned above.

● Sending lecturers and holding on-site seminars

Nissin Electric Co., Ltd. and Nippon ITF, Inc.: Jointly sending lecturers toan elementary school for a science class in July and offering other support

Contributions to Local Communities Activities in other countries● Initiative to show respect for the aged in China

on the Double Ninth Festival

Sumitomo Electric Interconnect Products (Shenzhen), Ltd.: Visits to a
total of approximately 150 elderly people in Shenzhen Fuya Nursing
Home for Elderly People in the neighborhood to provide daily
necessities for elderly people (milk, bread, fruits, futon mattresses,
cups, etc.) and cake on the Double Ninth Festival (September 9 in
the Chinese calendar) every year for eight years from 2010

Activities of the SEI Group CSR Foundation,a Public Interest Incorporated Foundation
The SEI Group CSR Foundation is a public incorporated
foundation established for the purposes of developing
human resources and promoting academic activities
In fiscal 2018, the SEI Group CSR Foundation received

●

●

●

●

contributions of a little over 184.6 million yen in total from
Sumitomo Electric (with the whole amount, including a little●

over 660 thousand yen donated through the cafeteria plan,
appropriated for operation) and (1) donated 108 million yen in
total to university courses, (2) supplied subsidies of 35.7 million
yen in total to academic and research activities and (3)provided scholarships of approximately 40.9 million yen in total
for 34 Japanese students and 18 foreign students learning inJapan and 130 local students studying at overseas universities.
In the program to make donations to university courses, we
provided monetary support for one new courses along with theeight courses continued from the previous ﬁscal year.
●●

Endowed lab. Innovation Management Science at Kyoto University
Data Entrepreneur Program (IT innovation human resource
development programs for data science and new business)at the University of Electro-Communications●●

Initiative to show respect for the aged in China
on the Double Ninth Festival

Hands-on training program for the development of young
entrepreneurs at the University of Tokyo
Elucidation of molecular mechanisms responsible forpathophysiology of diseases and clinical application by analysis ofendoplasmic reticulum microfragments. at Hiroshima University
Basic glycobiological research for elucidating the pathologicalmechanism and its clinical application" at Hokkaido University
Laboratory for Water, Food and Health Risk in Asia at
Yamagata University
Development of new cancer biomarkers that allow early
diagnosis of liver metastasis at Kobe University
Microbial dark matter resource use and biochemicalengineering at the University of Tsukuba"Eco-epidemiological control of mosquito-borne disease inSoutheast Asia" at Ehime University (new)For the program to support academic and research activities,
we received 185 applications. Out of them, we have selected
29 research programs including basic science research thatneeds research funds and exploratory study by young
researchers, and offered subsidies to them.
Details on the program are introduced in the SEI Group CSRFoundation page of our website※.

CSR VOICE

I hope that more companies fulﬁll their social responsibility like Sumitomo Electric
Ms. Ha Tran Thi Thu, 4th-year student, Engineering English Department, School of Foreign Languages, Hanoi University of Science and Technology
First of all, I would like to express my sincere gratitude to Sumitomo Electric for providing me with theprecious scholarship. This support definitely means a lot to my student life. From an economic
perspective, the scholarship covered almost all of my tuition fee for the last year and reduced thefinancial burden on my parents. My parents sell fruits and vegetables. To feed and educate their three children, they wake up at
two in the morning and work until eight at night. My parents do so every day in all weather. So, the financial support is not only
precious assistance for me but also gives my parents happiness and incentive to work. In addition to the quality of products, I
was strongly impressed by the social responsibility fulfilled by Sumitomo Electric in various fields including human resource
development, environmental conservation and global development. I feel that it is certainly the principle and philosophy I
should also follow in my life. I will obtain a bachelor's degree at Hanoi University of Science and Technology in July 2019 andwant to become an English teacher after graduation. I believe that I can teach the spirit of charity I learned from thescholarship, as well as knowledge, to students. While the weather conditions in Hanoi are getting severer, my parents keep
working diligently for the bright future of their children. I will do my best to meet their expectation and ensure that they can feelproud of me. Lastly, I would like to show my deep appreciation to Sumitomo Electric again. I also hope that companies become
involved in society more actively than ever.

45 CSR Report 2019Web

※ Details are available at the SEI Group CSR Foundation page of our website.

https://www.sei-group-csr.or.jp/e/index.html

"Laboratory for Water, Food and Health Risk in Asia"
at Yamagata University
Basis for Management

Programto MakeDonations to
University
Courses

We aim to cultivate human resources who canaccurately assess health risks associated withsafe water and foods in Asia through education
and research beyond the boundaries of academic fields
Dr. Pham Viet Dung, Assistant Professor (left)

Dr. Masateru Nishiyama, Assistant Professor (right),
Faculty of Agriculture, Yamagata University

with an aim of ensuring that the students can obtain a degree
during the period when this program is operated.
The "Research" activities we have conducted include a survey ofcontamination of oysters with norovirus in the estuary of Huong
River in Vietnam and a survey of contamination of agricultural
fields around a landfill site for municipal wastes in Thailand.
As "International exchange," we actively interact with universities
in five Southeast Asian countries. We send students, mainly
graduate students of Yamagata University, to those universities
every year and organize a seminar attended by them with local
students for about one week. In the seminar, the students visit
facilities, conduct field surveys and have debates for solving
problems. It was held at Hue University in Vietnam in September
2017 and at Kasetsart University in Thailand in September 2018.

■ Participating universities
Kasetsart University(Thailand)

Yamagata University(Japan)Hue University

De La Salle University

Social Contribution(Philippines)

Research

International
exchange(Cambodia)

Sending 15 students
enrolled in the program(including those who
do not belong to thefaculty) to foreigncountries every year

"Lecture on Global
Food, Agriculture andEnvironment" byprofessors of thisprogram andsupporting professors

Introduction of
cutting-edge knowledges
and technologies
through researchers andteachers invited fromoutside the university

Visits to relevant local
facilities, field surveys
and workshops withlocal students

Students can acquireabilities that can beused for research andinternational
exchange in Asia.

Students can conduct
world-leading
researches on water,food and health risk in
Asia.

Students can directly
experience andunderstand various
problems in Asia andalso obtain English
discussion skills.

Coordination with the globalization of
Yamagata University and the Faculty of Agriculture

We consider that this program
can contribute greatly to several
themes of SDGs including health(Goal 3), access to water (Goal 6)
and sustainable cities and communities (Goal 11). While ourtargets are Asian countries, we think that it is consistent with thepolicy of addressing the most vulnerable first, which is afundamental approach to SDGs. We greatly appreciate theacceptability and inclusiveness of the SEI Group CSR Foundationthat has selected this course despite the fact that it tackles such agrand subject in a low-key and diligent manner.
We will continue to address water pollution in association withindustrial development and global warming, as well as
subsequent damage to agricultural products and health risk due
to contaminated foods. Backed by the support from theFoundation, we will promote cross-sectoral and comprehensive
education and research covering all of those subjects.

CSR Report 2019

Environmental
Preservation

In the aspect of "Education," we have invited three international
Ph.D. students (including one student in the master's program)from Asian countries so far. The Assistant Professor Dr. Pham Viet
Dung and other members are working to cultivate experts who
can assess water, food and health risk in a sustainable manner

Through the promotion of human resource
development and academic research,
we will also contribute to the achievement of SDGs

Human Resources

Cooperation of 5 universities in
5 Asian countries(Indonesia)

Supply Chain

Setting of issues
based on past andcurrent research
projects

Padjadjaran University

Quality

Education in theinternational
development programof Faculty ofAgriculture, Yamagata
University

Core
Category

Institute ofTechnology ofCambodia(Vietnam)■ Donated Course Laboratory for Water, Food and Health Risk in Asia

Education

Group's CSR Activities

In the Asian countries experiencing remarkable economic
development, the presence of the agricultural sector is still
significant and the food production activities to support thegrowing population are causing the deterioration of the production
circumstance and the ambient environment due to the excessive
use of fertilizers and pesticides. In addition, the effluent and waste
generated in the industrial and consumer sectors have a large
impact, and flooding and drought due to climate change are alsorisk factors that can affect stable production and supply of food.
Although the safety of water has been also regarded as an issue tobe addressed in Asia in recent years, people have not paid
attention to food pollution yet or sufficiently recognized it as a risk.
This program aims to conduct research from a wider perspective
ranging from water and foods to human health risk. Its goal is tocultivate human resources who understand the safety of waterand food, which underlies the sustainable development ofindustry and society in Asia, as well as various problems that posea threat to it, and can accurately assess the risks.
The three key pillars of this program are education, research andinternational exchange.

Professor Toru Watanabe (center)

Governance

The research subject is food-related healthrisk in Asia caused by environmental pollution

Business Outline

The SEI Group CSR Foundation makes donations to excellent university coursesthat contribute to social development. One of them is a program of the Facultyof Agriculture of Yamagata University for comprehensive education, researchand human resource development covering water, food and health risk in Asia.

46

CSR Core Category

CSR Priority Theme

Quality

Product Quality & Product Safety

We support the creation of strong factories throughGlobal Quality Management System Audits
One of the priority initiatives for VISION 2022 is "Enhancement of Manufacturing
Capabilities." For quality management, we promote company-wide quality improvement
activity (QR-1 campaign) that aims to prevent serious complaints, reduce the numberof complaints and total loss for the achievement of Zero Accidents to Products .
For the prevention of quality problems, it is important to systemize tasks andestablish their mechanism and also to implement a cycle to continuously improvethe mechanism through actual operation of the tasks. We are in charge of Global
Quality Management System Audits, which check whether each division has
systemized its necessary tasks and established their mechanism or not, as
well as whether it operates the mechanism properly or not, based on the
Sumitomo Electric Group Quality Management Global Standards, which are
the fundamental rules for quality in our group. The audits were conductedin a total of 110 divisions in Japan and a total of 42 divisions overseas
by ﬁscal 2018. In addition to indicating individual defects andnon-conformances, the audits also place an emphasis on identifying
the weak areas in quality management by the target division to giveit an opportunity to start measures to improve its quality structure.
While our products are wide ranging, they share some measures
for the improvement of the quality structure. The audits focus
on the common issues to support the creation of strong
factories.

Toshio Akiyoshi

Senior Assistant General Manager,
Quality Management Division,
Manufacturing Management &Engineering Unit

Product Quality & Product Safety
Basic Approachquality assurance systems based on the standards so thatAs a corporate entity involved in manufacturing, thecompany-wide quality improvement activity called the QR-1

Sumitomo Electric Group aims to provide safe, reliable andhigh-quality products to customers in a stable manner as afundamental principle based on customer-oriented andquality-oriented policies. To continue to achieve this, ourgroup works to strengthen its underlying manufacturing
competence and continuously makes steady efforts tosystematize daily duties as a mechanism, implement themsoundly and further improve the mechanism.
Sumitomo Electric has historically strived to enhance the
manufacturing competence under its basic policies including
participation of all employees and continuous improvement.
To promote these activities even more strongly, we set up
Monozukuri Technology Improvement Committee as acompany-wide organization in 2015, and promotegroup-wide activities to strengthen its manufacturing
capabilities.
As part of the efforts to systematize the daily operation, theSumitomo Electric Group Quality Management Global
Standards were established as a common framework to be
applied to divisions throughout the Group in 2013. In
addition, the content of the standards is reviewed andrevised on an as-needed basis. The divisions of our groupmake continuous efforts to develop and strengthen their own

47 CSR Report 2019

customers can use our products with a sense of security. A
campaign was also developed, in which we have madecontinuous efforts to enhance the awareness of quality
among all employees through the three activities of Own
Process Quality Assurance Activities, Quality Management
Education and Global Quality Management System Audits.

3 Activities That Support
the Company-wide Quality
Improvement Activity
1．Promotion of Own Process Quality
Assurance Activities
2．Quality Management Education
3．Global Quality Management System Audits

occurrence is 2nd (no defect produced in a normal

We develop the QR-1 Campaign for the improvementof quality and reliability

process is 4th (defects cannot be prevented from being

mainly of business-to-business (B2B) transactions, we believe
will lead to greater customer satisfaction. Thus, we launched
the reliability improvement campaign throughout the Groupin 1975 based on our customer-oriented and quality-oriented
policies. Since then Sumitomo Electric has carried out the
campaign with the priority subjects selected according to theneeds of the times. We launched the
QR-1 campaign in ﬁscal 2002, aiming tocustomers, prevent quality risk andestablish its structure for quality andreliability to overtake the competition.

QR-1 campaign logo
QR：Quality & Reliability

may be passed on to the customer if no action is taken in thiscase, and efforts have to be made to improve the Degree of
Quality Assurance to B or higher.
This system has enabled an objective assessment of quality
risks and made risk reduction efforts more effective. We willcontinue to develop these Own Process Quality Assurance
Activities on group-wide and global scales.
Degree of
Quality
Assurance

Rank of prevention of
defect ﬂow-out

Rank

Status of the processes and operations

1st

2nd

3rd

4th

1st

A suﬃcient foolproof mechanism is in placeand defects are prevented from being
produced or passed to the following process

1st

A

A

2nd

No defect is produced or passed to thefollowing process during normal operations

3rd

There is a possibility that defects can beproduced or passed to the following
process

4th

Defects cannot be prevented from being
produced or passed to the following
process

S

S

2nd

S

A

B

C

3rd

A

B

C

D

4th

A

C

D

E

Enhancement of
Quality Management Education

Since fiscal 2010, we have promoted Own Process Quality
prevent defects in each process from being produced or

Quality Management Education is developed throughout
the Group including overseas companies to cultivate
the culture of quality firstpassed down to the following process. As part of these

The Sumitomo Electric Group provides employees with

Assurance Activities, which are comprehensive efforts toinitiatives, defect-free process conditions are established at
the design stage and the conditions are maintained throughthat any defect still occurs, we work to identify the cause andimprove the quality in the pursuit of defect-free process
conditions. Each division of the Sumitomo Electric Group isconstantly committed to Own Process Quality Assurance
Activities for their products. In addition, the Quality
Management Division in the Corporate Staff Group strives tostaff members who implement the initiatives, exchange
meetings between different divisions and other support for
the activities.

Since fiscal 2014, we have organized a quality management
training course on a nomination base for managers in chargeof product development, design, manufacturing and quality
assurance, and the course was taken by 1,241 managers inJapan by the end of fiscal 2018. We will continue to give thetraining for managers and improve the content.
We work to improve various domestic education programs,
such as position-based training for all employees,
nomination-based training in accordance with specializedjobs and special issues and optional training to learn relevant

Process

Process

Produceno defect

Good
products

Pass
no defect

Good
productsGood
products

Shipment

Inspection

knowledge, along with practical education including QR-J,＊
MKP＊ and GKP.＊ Overseas, we have initiated the personnel

education activities of the Sumitomo Monozukuri
Development Committee in the U.S., as well as the meetingsof Quality Management Committee in China, as opportunities
to organize exchanges of information on model cases, andWe also promote the introduction of the Degree of Quality
Assurance, which is an indicator that visualizes quality risks,system, the probabilities of the prevention of defectoccurrence and defect flow-out are respectively determinedby type of defect in each process on a four-point scale from1st (sufficiently prevented) to 4th (not prevented), andcombined to determine the Degree of Quality Assurance on aprovided training sessions on Own Process Quality Assurance
Activities. In fiscal 2018, a total of 6,386 persons, including
overseas employees, completed Quality Management
Education programs. The cumulative number of the persons
who participated in the programs since fiscal 2010 has
reached 44,497. We will continue to develop the culture ofquality first through various quality management education
programs.

Environmental
Preservation

six-point scale from S to E.
To prevent complaints from occurring, we should ensure thatthe Degree of Quality Assurance for the type of the defect is
B or higher. For example, when the prevention level of defectGlossary ＊QR-J

Own Process Quality Assurance practitioner training
course to develop key persons for the Own Process
Quality Assurance activities in each division.

＊ＭＫＰ

Abbreviation of MONOZUKURI-KAKUSHIN professional training
Program that is the practical training program to develop
key-personnel (engineers) who are to drive manufacturing innovation.

Human Resources

as an initiative to eliminate defects in processes. In thisSupply Chain

Produceno defect
Pass
no defect

ensure the quality of products and services at higher levels.

Qualityfurther stimulate the activities through training to develop

Resource Development in P62 for details) to improve andSocial Contribution

process management at the mass production stage. In casetraining on quality control at the SEI University (see Human

Core
Category

We are introducing the Degree of Quality Assurance
Level-based assessment and implementing initiatives
to improve the degree at overseas sites

Group's CSR Activities

Own Process Quality Assurance Activities
Aiming for Zero Complaints

Assurance is only C. There is still a possibility that defects

Governanceimprove quality from the viewpoint ofpassed to the following process), the Degree of Quality

Business Outlinethat above all further quality improvement for our products

operation) and that of defects being passed to the following

Rank of prevention of
defect occurrence

As the Sumitomo Electric Group's business activities consist

Basis for Management

Development of QR-1 Campaign＊ＧＫＰ

Abbreviation of GENBA-KAIZEN professional training
Program that is the practical training program to develop
key-personnel who are to promote shop-ﬂoor improvement.

CSR Report 201948

Global Quality Management System Audits
We conducted audits of 110 Japanese bases and42 overseas bases by fiscal 2018
We systematically conduct Global Quality Management
System Audits to evaluate the quality control initiatives ofeach business unit in light of the Sumitomo Electric Group
Quality Management Global Standards from the perspectiveof customers. In these audits, we identify weaknesses of each
unit in terms of management, design, manufacturing andcenter function to provide an opportunity to improve its
quality assurance system and support its follow-up activities
to reinforce the structure.
Since the start in fiscal 2010, the audits have been conducted
at 110 sites in total in Japan. Progress in the improvement of
the quality structure is seen as the audits are repeated. We
will repeat the audits with the aim of promoting continuous
improvement of the quality assurance system. Overseas, theaudits were conducted in a total of 42 sites in China andSoutheast Asia through collaboration with domestic units
having the center function, in an effort to enhance awarenessof quality among local employees.
To maintain and improve the quality assurance system basedon the Group Quality Management Global Standards, we willcontinue to check progress in compliance with the standards
through the global quality management system audits.

Monozukuri Technology
Improvement Activities
We promote manufacturing strengthening activities
based on Own Process Quality Assurance activities
and SEI's Just-In-Time approach
The Sumitomo Electric Group conducts business operations
in five business segments, and the types of its products andproduction systems are wide ranging. Irrespective of type, weshould meet various customer needs, produce top quality
products sought by customers in a safe and environmentallyfriendly production system with the shortest lead time anddeliver them to customers in a reliable and timely manner.
This is the ideal manufacturing in SEIPS.＊

To this end, we will pursue Own Process Quality Assurance

Customer Satisfaction Improvement
Activities by the Sales GroupWe are committed to activities to understand the problems
of customers and make proposals to help solve them
Our Group's business activities consist mainly ofbusiness-to-business transactions, and we therefore believethat the proper identification of the opinions and demands
from customers (companies) through daily sales activities andfurther quality improvement of products and services willlead to greater customer satisfaction.
Based on this recognition, we focus on the training of theemployees engaged in sales activities to enhance theirabilities to understand the problems of customers andpropose solutions to them. We also cooperate with external
consultants to give training to management staff in Japan tolearn methodologies for making proposals and methods tomanage and instruct their subordinates. In addition, action
guidelines to stimulate organizations have been formulated
for management staff in charge of customer satisfaction (CS)
improvement. We will also conduct surveys to listen to theopinions of customers, analyze the results and give feedback
to ensure CS improvement.
To further increase customer satisfaction and strengthen theSales Group as a whole in response to progress inglobalization, we will make use of the opinions ofstakeholders collected through our visits to customers, trade
fairs, websites and other means for our future initiatives.

Outcomes of the Quality Management Activities
We will continue to make steady efforts toeliminate complaints
Thanks to our ongoing quality management activities, thenumber of complaints is on the decrease and has been
reduced by about 30% from the figure in fiscal 2012. In fiscal
2018, the number also decreased by 2.5% from the previous
fiscal year level. However, many issues still need to be
improved to eliminate complaints. We will continue to makesteady efforts to eliminate complaints with the three main
pillars of Own Process Quality Assurance Activities, Quality
Management Education and Global Quality Management
System Audits, in addition to Monozukuri Technology
Improvement activities.

activities and SEI's Just-In-Time approach as the two main

Number of Complaints by Year (results in 2012 = 100)

pillars to identify problems, thoroughly eliminate overburden,

100

waste and irregularity, establish a structure of continuous
improvement and become a company with the highest
competitiveness in manufacturing.

① Pursuit of Own Process Quality Assurance activities:
We will make continuous efforts to ensure quality in theprocesses and prevent defects from being produced or
passed down to the following process in each process② Pursuit of Sumitomo Electric s Just-In-Time approach:
We will make continuous efforts to pursue just-in-time
manufacturing by producing what is needed in the rightquantity and right timing.
While our group adopts a wide range of systems andmethods to produce various types of products, they all headin the same direction to further evolve and deepen them.

Glossary ＊SEIPS

49 CSR Report 2019

100
84.3

80

79.1

89.5
72.5

68.1

66.4

2017

2018 （Fiscal year）

60
0

2012

2013

2014

2015

2016

(Note) The data cover Sumitomo Electric and its manufacturing aﬃliates in Japanand overseas (including the Sumitomo Wiring Systems Group)

Quality Compliance
We aim to become a company trusted by society
The attitude of companies towards quality is evaluated bysociety more strictly than ever these days. Supply of productsthat surely have the quality required by customers incompliance with laws and rules is an absolute foundation forcompanies to grow in a sustainable manner. The Sumitomo
Electric Group takes the measures mentioned below toensure quality compliance.

SEI Production System (SEIPS) is the concept of the production system focusing
on Own Process Quality Assurance activities and SEI's Just-In-Time approach.

Under the corporate principles of offering the very best goods
and services to satisfy customer needs and contributing tocreating a better society and environment, with a firmGroup is making efforts to enhance the safety of products.

We adopt the basic approach that the products to be
introduced to the market should undergo thoroughexamination of safety, especially at the development anddesign stages.

For product safety, we hold annual technical seminars on the
Product Liability Act and the revised Consumer Product Safety
Act through cooperation between the Quality Management
Division and the Legal Department.

The seminars are based on the idea that the safety standards
predictable misuses. The content is designed to deepen the
trainees' understanding of the laws with reference to actual

cases, as well as to provide practical lessons on the issues

such as the review of product safety at the development anddesign stages, proper display of warning labels, maintenance of
product safety, collection of product safety information andAs part of the product safety initiatives, we conduct voluntary

inspection of the check items applied to the whole Group once

RoHS Directive
Glossary ＊RoHS stands for Restriction of the use ofcertain Hazardous Substances. This EU
Directive restricts the use of certain
hazardous substances in electrical andelectronic equipment.

＊ELV Directive

ELV stands for End of Life Vehicles. This EU
Directive restricts the use of lead and threeother hazardous heavy metals in automobiles
to reduce the impact of end-of-life vehicles on
the environment.

Compliance with Regional Regulations on
Chemical Substances across the Globe
We are promptly responding to progressive tightening ofregional regulations on chemical substances across the globe
The Sumitomo Electric Group has taken measures to replace
the substances listed in the EU RoHS＊ and ELV Directives,＊ andis meeting customer demand for products that contain noprohibited substances. For example, we already discontinued
the direct use of the four types of phthalates to be banned by
the RoHS Directive from 2019 in our products by the end of
fiscal 2017 in advance. We are also making efforts to avoid theuse of these substances in the parts to be used in our products
through cooperation with suppliers.
At the same time, to comply with the REACH＊ regulation, we
are working for final registration of chemical substances one by
one as required and completed the registration of gallium
arsenide (GaAs) in 2012 and tungsten carbide (WC) in 2017.
We are also making efforts to ensure appropriate responses tothe requirements of the REACH regulation including reportingof the SVHC＊ contained in products.
To quickly respond to progressive tightening of regional
regulations on chemical substances across the globe, ourgroup is working to collect information on regulations in
Europe, China, Southeast Asia and other countries and sharethe information within the Group.

＊REACH regulations

REACH stands for Registration, Evaluation,
Authorization and Restriction of Chemicals.
Regulations of the European Parliament and of theCouncil for protection of human health and theenvironment in the European Union.

Environmental
Preservation

response to accidents.

《 Voluntary Inspection on Product Safety 》(Note) As the types of products and requirements from customers diﬀer greatly
between divisions and aﬃliates, the guidelines and standards are applied
ﬂexibly according to their respective circumstances.

Human Resources

established by companies should also take into account the

conducting product assessment at the design and development
stages. Through these initiatives, we strive to prevent hazardous
chemical substances with large
environmental impact such as
mercury and cadmium from being
contained in products.
The Sumitomo Electric Group also
has the Chemical Management Task
Committee in place to enhancecoordination within the Group.

Supply Chain《 Training on Product Safety 》

In pursuit of reducing environmental impact of the products of
the Group and our customers, as well as improving compliance,
the Sumitomo Electric Group is committed to proper
management of chemical substances in products. To this end,
we implement the SEI Guidelines for the Management ofChemical Substances in Products (note), which was established to
specify the items to be carried out at each stage of the
manufacturing process such as procurement, design, production
and quality assurance based on JIS Z7201 Management ofChemical Substances in Products - Principles and Guidelines.
We have also established the SEI Standards for Chemical
Substance Management, which are the standards for the
management of chemical substances in products to be managed
at each of the stages, and implement the SEI Guidelines forGreen Quality Purchases (note) based on the standards, while

Qualityawareness of our social responsibility, the Sumitomo Electric

We are managing chemical substances properly inaccordance with our own guidelines based onJapanese Industrial Standards(JIS) guidelines

Social Contribution

We are striving for the improvement of the safety level throughpractical training and voluntary inspection with focus on the pursuitof product safety at the product development and design stages

Management ofChemical Substances in ProductsCore
Category

Product Safety (Product Liability)

promote product safety measures.

Group's CSR Activities

While the Quality Management Division conducts Global
Quality Management System Audits of each division in the
Sumitomo Electric Group, we will enhance inspections for theprevention of quality data falsification in the audits. Our groupalso has a mechanism where all divisions conduct
self-examination of their main operations every year. We haveadded the prevention of quality data falsification to theinspection items of the self-examination to ensure the absenceof quality data falsification and check the efforts of eachdivision to develop rules for the prevention of quality data
falsification and provide quality compliance training each year.

and implemented autonomously to strengthen the system toGovernance《 Strengthening of the Function to Check Quality Data Falsification 》

Based on the inspection, necessary measures are discussed

Business Outline

We have established the Sumitomo Electric Group Quality
Management Global Standards as the basic rules on quality
to be followed by all divisions as mentioned above. In
consideration of the cases of other companies on data
falsification and improper inspection, we have formulated
internal rules on the prevention of quality data falsificationand incorporated them into the standards to disseminate therules and ensure compliance with them. In fiscal 2018, we
provided education on the prevention of quality data
falsification in the training programs on compliance for the
managers of our group in Japan. The course was attended byabout 6,000 persons, which account for approximately 75%of the managers who are required to take it, and we willcontinue the initiative. In addition, we have added acurriculum on the prevention of quality data falsification to
the quality management education for employees in different
positions (15 position-based courses and eightnomination-based courses) to expand and reinforce our
education on quality compliance.

every two years in order to identify any product safety risks.

Basis for Management《 Clarification of Rules on the Prevention of Quality
Data Falsification and Improvement of the Education 》＊ＳＶＨＣ (Substances of Very High Concern)

SVHC stands for Substances of Very High
Concern .Chemical substances designated by the
EU as substances which may cause serious
eﬀects to human health or the environment.

CSR Report 201950

CSR Core Category

CSR Priority Theme

Supply Chain

Promotion of CSR Procurement

Under the slogan, "make best eﬀorts and never give up on improvement,"
we communicate with our partners in a "sincere and open-minded" manner.
I belong to System Parts Group, which is in charge of the procurement of raw materials
and supplies for infrastructure products such as traﬃc products and information
communication network devices. The group is committed to an initiative to evaluate
suppliers (partners scoring katsudo (activities) or PSK) as a foundation for dialogues
in the promotion of fair and impartial procurement activities based on mutual trustwith them, which is speciﬁed in the Basic Procurement Policies of the Sumitomo
Electric Group.
PSK was launched ahead of other parts of our group in 2006 as an initiative toenhance communication with suppliers, which are our partners, and improvetheir abilities to deal with quality, cost, delivery and other items, as well as
the quality of the supply chain as a whole. All staﬀ members who work topromote PSK, including me, believe that the improvement of the supply
chain helps enhance our product capabilities and PSK, which underlies
it, will promote fair and impartial procurement activities. To further
develop PSK, the level of the promotion of CSR activities by suppliers
is also included in the evaluation indicators of PSK. For "make besteﬀorts and never give up on improvement," we also plan to
conduct improvement activities through on-site inspections ofsuppliers to enhance their CSR activities in the future.

Susumu Suga

Assistant General Manager,
System Parts Group
Materials Department,
Procurement Division

Supply Chain
Basic Procurement Policies

Group Procurement System

We share our Basic Procurement Policies with main
suppliers and seek their understanding and cooperation

We are working to ensure thorough compliance with
our policies and enhance awareness amongprocurement staff on a global scale

The Sumitomo Electric Group considers procurement to be aservice that supports the foundation of its businessactivities, and in May 2006, established Basic Procurement
Policies in line with the Sumitomo Spirit and the Sumitomo
Electric Group Corporate Principles. We have distributed the
Basic Procurement Policies to our main suppliers, along with
our Group companies, and have sought their understanding
and cooperation.

Basic Procurement Policies (extract)※
1．Promoting procurement activities that contributeto creative and global corporate activities
2．Promoting fair and impartial procurement activities

Based on the Basic Procurement Policies, the procurement
measures and activities of the Sumitomo Electric Group aredeveloped under the initiative of the Group Procurement
Collaboration Oﬃce, an organization established in the
Procurement Division and composed of the staﬀ in charge ofprocurement in 22 divisions and Group companies.
Speciﬁcally, the oﬃce members work together to promotevalue analysis (VA＊) and provide education to enhancecompliance related to procurement and improve
procurement skills. An e-mail magazine is also distributed tomore than 400 procurement staﬀ members to sharenecessary information throughout the Group.
Overseas, we promote coordinated procurement on aregional basis under the initiative of the International

3．Promoting compliance-based procurement activities

Procurement Oﬃces (IPOs) of the Procurement Division

4．Promoting procurement activities based on
mutual trust and cooperation with supplierspart of the eﬀorts, we organize meetings of liaison

5．Promoting procurement activities friendly to
the global environment

51 CSR Report 2019Web

※ For the entire policies, please see the following page.

located in China, ASEAN, the United States and Europe. As
committees composed of IPOs and procurement staﬀ ofGroup companies to develop group-wide initiatives andprovide related training to procurement staﬀ.

https://global-sei.com/csr/sociality/procurement.html

Glossary ＊Value Analysis (VA)

VA is conducted to replace Material X with cheaper
Material Y that still provides the quality required forthe product.

We also ask our suppliers to comply with the
CSR Procurement Guidelines by specifying compliancewith them in the basic transaction agreement

6. Social Contribution and Elimination of Antisocial Forces
7. Respect to Human Rights and Considerations ofOccupational Health and Safety(Including Response to the Issue of Conﬂict Minerals)

9. Maintenance of Conﬁdentiality and Information Security

Web※ Please see the following page forthe entire guidelines.

https://global-sei.com/csr/guideline/

●

2022

●

Launch of coordination with Sumitomo Wiring Systems, Ltd.,
Sumitomo Riko Company Limited and Nissin Electric Co., Ltd.
Promotion of CSR procurement covering the suppliers that
represent(note) 90% of the value of our domestic procurement

Gradual expansion to include major suppliers of our overseas aﬃliates(Note) Domestic procurement by Sumitomo Electric and its aﬃliates in Japan(excluding Sumitomo Densetsu Co., Ltd.) is covered.

CSR VOICE

We are grateful for the opportunities tolearn various issues through responding to
the requests for CSR activities
Mr. Shuzo Sonoda, President (right)
Mr. Hiroki Fukuda, Managing Director, Administration Division (left)
Fukuda Metal Foil & Powder Co., Ltd.

Fukuda Metal Foil & Powder has a long history. Our
company was originally founded as a wholesaler of goldand silver foil and powder in Muromachi, Kyoto in 1700.
Based on the policy that we should do jobs with a fullunderstanding of our roles and capabilities, which is
mentioned in the family dictum "Ie-no-Nae" (family
seedlings), we have steadily promoted research anddevelopment and operated businesses in the field of
non-ferrous metal foil and powder. With the sales volumeof 55.4 billion yen in fiscal 2018, we provide the mostappropriate products as a specialist of metal foil andpowder.
Our relationship with the Sumitomo Electric Group started
in the 1960s and we have supplied metal powder for
sintered powder metal products since then. We also
supply other products nowadays, such as those in theelectronic printed circuit board business. We feel that we
maintain a good relationship partly because the Sumitomo
Electric Group and our company share some characteristics
including simplicity, fortitude and sincerity.
About six years have passed since the Sumitomo ElectricGroup started CSR procurement, and other companies also
make similar requests for CSR activities to us these days.
The requests give us good opportunities to be aware ofsocial demand. While we have been asked about our
response to conflict minerals and chemical substances
contained in our products, as well as issues to be checked
in relation to BCP, we also received more multifaceted
inquiries including those concerning management based on
the RBA Code of Conduct＊ recently. With the recognition
that CSR activities are indispensable for the survival ofcompanies, we will continue to promote various activities
for CSR items such as environmental conservation, solutionof labor shortage and contribution to the local community.

Glossary ＊Issue of conﬂict minerals

Armed groups that are involved in serious violations of humanrights obtain funding from trading of tantalum, tungsten, tin,gold and their derivatives produced in the Democratic
Republic of the Congo and its neighboring countries.

Environmental
Preservation

8. Disclosure of Information and Promotion ofCommunication with Society

2019

On-site inspections and interviews of suppliers to ask for improvement(86 companies in ﬁscal 2017 and 86 companies in ﬁscal 2018)

Human Resources

5. Compliance with Laws and Social Norms andFair and Proper Business Activities●

Continuance of the survey of suppliers (a total of 1,560 companies)

Supply Chain

4. Contribution to Preservation of
the Global Environment

2018

●

Quality

3. Promotion of Sound Business Management(covering the suppliers that represent 90% of the value of the domestic
procurement excluding that for Sumitomo Wiring Systems, Ltd. andthe listed subsidiaries, as well as suppliers of some of our overseas aﬃliates)

●

2017

Implementation of a survey with a CSR procurement"self-assesment sheet" (a total of approximately 1,930 suppliers)

Social Contribution

2. Improvement of Technological Capabilities

2016

Core
Category

1. Provision of Useful and Safe Products and Services●

Group's CSR Activities

The Sumitomo Electric Group aims to contribute to creating abetter society and environment, with a ﬁrm awareness of oursocial responsibility. To this end, the suppliers that directly or
indirectly provide their products and services for us are also
required to work on the activities together with us. Therefore, wehave summarized our requests to the suppliers of the Sumitomo
Electric Group in these guidelines, and the suppliers are requested
to promote compliance with them. Our suppliers are also asked torequest their suppliers to comply with the guidelines.

2013

Establishment and dissemination of
the CSR Procurement Guidelines

Governance

Sumitomo Electric GroupCSR Procurement Guidelines (extract)※●

Business Outline

To promote our commitment to CSR in the procurement
activities, we established the Sumitomo Electric Group CSR
Procurement Guidelines based on the Sumitomo Electric Group
Corporate Principles and Charter of Corporate Behavior in
August 2010. The guidelines were revised to include provisions
concerning response to the issue of conﬂict minerals＊ in ﬁscal
2014. To enhance promotion of the guidelines, we also ask
suppliers to take proper action by specifying relevant
requirements in the basic transaction agreement.
For the promotion of CSR procurement, in addition to activities
to disseminate the guidelines among suppliers, we need tocheck the progress in the dissemination through CSR
procurement self-assessment of suppliers and also promote
improvement activities in full coordination with suppliers.
As shown in the table on the right, we expanded CSR
procurement self-assessment to receive answers from about
1,800 suppliers, which represent 90% of the value of thedomestic procurement by our divisions and domestic aﬃliates(excluding Sumitomo Wiring Systems, Ltd. and the listed
subsidiaries), by ﬁscal 2016. We also started to include
suppliers for some of our overseas aﬃliates in the survey targets
and still continue the survey. In ﬁscal 2018, we surveyed
approximately 710 suppliers, selected 86 out of them to havean interview or conduct an on-site inspection concerning
particularly important items and asked them to enhancecompliance, information management and other relevant
activities. We also began to cooperate with Sumitomo Wiring
Systems, Ltd., Sumitomo Riko Company Limited and Nissin
Electric Co., Ltd. to enhance the activities of Group companies.
From ﬁscal 2019, we will further improve the conventional
activities and enhance coordination with Group companies tomeet the target of "Promotion of CSR procurement covering
the suppliers that represent 90% or more of the value of ourdomestic procurement."

Activities from ﬁscal 2013 to ﬁscal 2018 and future initiatives

Basis for Management

Commitment to CSR Procurement＊RBA Code of Conduct

Code of conduct formulated by the Responsible
Business Alliance (RBA) concerning the working
environment, the environment and ethics mainly inthe electronics industry and its supply chain

CSR Report 201952

Contribution to Preservation of
the Global Environment

relevant products in the aﬀected area on a real-time basis,

We are committed to green procurement as
an essential quality factor

of natural disasters including Northern Osaka Earthquake andTo promote environment-friendly procurement activities, theSumitomo Electric Group has made eﬀorts to eliminate the useof banned substances in its products and enhance control ofother harmful substances contained in products, based on the
Sumitomo Electric Group Green Procurement Guidelines sinceﬁscal 2003. In ﬁscal 2012, these guidelines were revised toissue SEI Guidelines for Green Quality Purchases as a newversion. We consider the guidelines as part of essential quality
standards and use them to maintain green procurement
activities.

While we introduced the ECO Factoring System incollaboration with Sumitomo Mitsui Banking Corporation in

2009, 58 suppliers have applied for the system and 44 of them
use it now. In this system, a favorable interest rate is applied towhich has been operated since then.

In ﬁscal 2018, we had fears of a supply shortfall due to a series
heavy rain in western Japan, as well as Typhoon Jebi, whichcaused a crush of a tanker into the bridge connecting the
Kansai International Airport and the mainland. In thesesituations, nevertheless, we were able to procure materials

without impact on our production or that of our customers by,for example, using the alternative products that had been
examined in the above-mentioned activities, receiving supply
preferentially with the cooperation of our suppliers andpromptly investigating the products for which quality data werefalsiﬁed. These incidents reminded us of the signiﬁcance ofsuch activities.

We will maintain these activities to strengthen our

procurement system that can supply products and services in astable manner.

suppliers that promote a certain level of environmental

Organization of Partners' Meetings

perform such activities.

Ninety-three suppliers participated in Partners' Meetings

conservation activities in order to encourage suppliers to

Response to the Issue of Conflict Minerals
We recognize this issue as a major social challenge andaim to eliminate conflict minerals from our business
As an initiative for promoting compliance-based procurement
activities, the Sumitomo Electric Group recognizes that thematter of conﬂict minerals from Congo and its neighboring

countries is a serious social issue in the supply chain. To fulﬁll
our social responsibility in procurement activities, we aim to
procure or use no conﬂict minerals involving any illegal or
dishonest acts. To this end, we also stipulate the approaches
to the initiatives in the CSR Procurement Guidelines andinvestigate the supply chain on conﬂict minerals. In the eventthat the use of minerals that may cause a social problem orserve as fund for armed groups is found, we will take measures
to avoid their use.

As a speciﬁc initiative, we ask suppliers to cooperate with ourinvestigation mentioned above, which is conducted every year.
In case that there is any concern over the use of minerals, therelevant suppliers are requested to take measures to avoid theuse as we do in the Group.

Response with Business Continuity Plan (BCP)
Our efforts to strengthen the system forstable procurement are producing steady results
Sumitomo Electric Group is committed to the development andimplementation of a business continuity plan (BCP) for

procurement divisions, which prepares for large-scale disasters
and other emergency situations, to ensure stable supply of
products and services and thereby avoid impact on the

production activities of our customers. The BCP assumes asituation that the suppliers of our parts and materials have

suﬀered damage from disaster and suspended production

The Sumitomo Electric Group organizes Partnersʼ Meetings

every year to enhance its relationships with suppliers. We use
this opportunity to explain the outline of our business activities

and the Basic Procurement Policies and commend the suppliers
that have contributed to the business activities of our groupthrough good proposals and support activities in order toestablish amicable and cooperative relationships with

suppliers. At Partnersʼ Meeting, we also present the CSR

Procurement Guidelines, as well as the Basic Procurement
Policies, to ask for their cooperation and promote theguidelines actively.

Partnersʼ Meetings were also held in eastern Japan, westernJapan and some of thedivisions and Group

companies in Japan, as
well as some overseas
facilities, in order todisseminate CSR
procurement ongroup-wide and global
scales.

Initiatives to Ensure Compliance withLaws Related to Procurement
We are conducting on-site inspections of divisions andaffiliates and giving them instructions to facilitate their
independent activities for compliance in procurement
The Procurement Division is committed to the following threepriority matters in its eﬀorts to ensure compliance with laws
related to procurement:

Priority matters●activities. In addition, to ensure that we know the impact ofdamage immediately after a disaster, we also reviewed●

as information on production and logistics bases, and in ﬁscal●

emergency contact information received from suppliers, as well
2017 we developed a system that enables us to check andupdate information on any sites that manufacture or store

53 CSR Report 2019

Partners' Meetings

Compliance with the Subcontract Act in regard to
appropriate dealings with subcontractors
Compliance with the Customs Law in regard to
appropriate custom reports and payments
Compliance with internal control rules in regard to
procurement in the Sumitomo Electric GroupBasis for Management

As to the priority matters, we continued to conduct on-site
inspections in Sumitomo Electric and its aﬃliates in ﬁscal 2018
to conﬁrm compliance with the rules as mentioned in the tablebelow.
Inspection results
In Japan: 6 aﬃliates

Internal
Control

In Japan: 6 aﬃliates
Overseas: 19 aﬃliates

Customs
Law

In Japan: 26 divisions of Sumitomo Electric and its
aﬃliates importing directly from overseas

In the on-site inspection, the Procurement Division visits thet a r g e t s i t e s t o check compl i ance wi t h l aws relate d to
Act and internal control, we selected the target sites again in
ﬁscal 2018 on the assumption that we will regularly visit all
domestic aﬃliates, and conﬁrmed their compliance with
relevant laws and rules. With respect to the Customs Law, allof the sections and companies importing directly from overseas
were inspected to check the correctness of the amounts incustom reports and other items, and we gave guidance on
The Procurement Division will continue to expand and improvethe education and inspection activities to promote compliancewith laws related to procurement.

Education System

In the Procurement Compliance Training Seminars in ﬁscal
2018, we organized seminars for Production Group and
The training seminars for Production Group and Corporate
Staﬀ Group are organized with the same content every year
to further enhance the understanding among the attendants
and establish and improve their awareness of compliance.
The seminars were organized as delivery lectures and asgroup employees as shown in the table below. To further
enhance the awareness of compliance related to the
procurement of materials within our group, we will continue
to organize training seminars in a way that more group
employees can attend them.
to ensure that researchers can not only learn the procedures
to obtain necessary materials and other items for R&D
activities but also establish a proper cooperative relationshipwith suppliers at the time of the commercialization of R&D
outcomes. The results of the training are presented in thetable below.

Production
Groupand Corporate
Staﬀ Group

Organized in 28 regions (video conference: 12
regions; delivery lecture: 16 regions)● Attended by 1,804 persons● Themes: Subcontract Proceeds Act, Customs Law andinternal control

R&D Group

No. ofcourses

1st half of
FY2018

7

26

132※

24

2nd half of
FY2018

7

26

117※

24

Key personnel
development program

2nd half of
FY2018

1

4

12

8

Training for overseas
purchasing managers

2nd half of
FY20181

1

9

9OFF-JT
Education program※Number of those who passed the ﬁnal exam

Environmental
Preservation

Organized in 3 regions● Attended by 13 persons● Themes: Subcontract Proceeds Act, internal control andprocurement for the commercialization of research outcomes●

No. ofNo. ofNo. ofparticipants
lecturescompanies(total)Date●

Human Resources

Results of Education

Results of training

Supply Chain

Training seminars for R&D Group were organized especially

Qualitytraining via a video conference system, attended by many

Social Contribution

Corporate Staﬀ Group as well as for R&D Group.

We continued to organize a training program to develop key
personnel on the Subcontract Proceeds Act in ﬁscal 2018 andprovided a certiﬁcate for 12 persons from eight divisions of
Sumitomo Electric and its aﬃliates who completed theprogram. For the understanding of the Subcontract Proceeds
Act, we have to make it known widely not only in the divisions
in charge of procurement but also in manufacturing anddevelopment divisions. Key personnel on the Subcontract
Proceeds Act means core personnel for the establishment of anautonomous system to comply with the act in each divisionand company, and we develop the personnel in a planned
manner.
A training program for overseas purchasing managers waslaunched in ﬁscal 2018 with an aim to develop the corepersonnel for the improvement of our procurement capabilities
on group-wide and global scales. In this program, we provide
the managers with opportunities to learn procurement-related
methods for cost reduction, risk management and other issues,
as well as the Sumitomo Spirit and CSR and other procurement
policies, in order to improve their skills and encouragethem to share the learning with the procurement staﬀ of
their companies. While
improving the content of
the training, we will
gradually expand thescope of the employees
who need to attend theprogram in the next ﬁscal
Training program to develop key personnel
year and thereafter.
on the Subcontract Act

Core
Category

We organize training seminars to improve procurement
skills on group-wide and global scales

In the Procurement Division, an OFF-JT＊ program for working
staﬀ is provided for the purposes of development of reliable
procurement staﬀ and handing down of procurement ethics,
knowledge and expertise. This program is also combined withexisting OJT＊ to create a synergistic eﬀect that will improve
procurement skills.
The OFF-JT program in ﬁscal 2018 was composed of sevencourses including "procurement-related laws and regulations, andCSR Procurement," each of which was provided by an expert in
the Procurement Division. The experts used textbooks they
prepared, and gave lectures through teleconferences with sites inJapan and overseas. In total, 249 persons attended the lectures.

Group's CSR Activities

revisions of the Customs Law and other laws.

Procurement Compliance Training Seminar for
Production Group and Corporate Staﬀ Group

Governanceprocurement. For the inspection on the Subcontract Proceeds

Business Outline

Subcontract
Proceeds Act

Glossary ＊OJT and OFF-JT

OJT (On-the-Job Training) is education and training received while the trainees
perform daily work. On the other hand, trainees receive OFF-JT (OFF the Job Training),such as group training sessions, when they are temporarily away from daily work.

CSR Report 201954

CSR Core Category

CSR Priority Theme

Human
Resources

Promotion of Diversity andOccupational Safety

We will work to support human resource development from a global
perspective to enhance the organizational strength of the entire group
I have engaged in global human resources since 2009. We support local managers outside
Japan for their career development and the promotion of their appointment as executives
and work to establish a foundation for the human resources who play a pivotal role in thesustainable growth of the Sumitomo Electric Group.
Particularly for local subsidiaries, we provide practical support to ensure that thepresident, who is often replaced in several years, can use human resources and run
the organization in a eﬀective manner from a medium- to long-term viewpoint.
More managers and presidents in overseas aﬃliates have been appointed fromamong local personnel in recent years and a total of 41 SEG Global Executives are
currently working actively. I hope that our group will become an organization
where talented employees have equal opportunities to pursue careerdevelopment within the Group, no matter whether they are recruited in
Sumitomo Electric or Group companies.
Our eﬀorts to promote diversity have produced results. Again in 2019,
Sumitomo Electric was selected as a Nadeshiko Brand in recognition of ouroutstanding achievement in the encouragement of women to work
actively by the Ministry of Economy, Trade and Industry of Japan and theTokyo Stock Exchange, and also certiﬁed as the top L-boshi company
by the Minister of Health, Labour and Welfare of Japan. We were also
awarded the ﬁrst prize of "Leading Companies with Actively
Participating Women in Osaka City."
In addition, we established the Sumitomo Electric Group Policy on
Human Rights in March 2019 to promote our initiatives for
Hiroshi Otagaki
respect for human rights in accordance with international
General Manager,
standards. We are thus making continuous eﬀorts to meet the
Global HR Office,various needs of stakeholders.
Human Resources Division

Diversity
Global HRM Policy

leaders, in order to accelerate our global human resource

We are actively promoting the establishment of
HR systems and guidelines to be commonly applied
on a global scale within the Group

inform people in and outside of the Group about it.

In the Sumitomo Electric Group, over 270,000 employees areworking actively in about 40 countries around the world. We
believe that for Sumitomo Electric to win the global
competition and grow further, it is essential that we fully

recruitment and promotion. We have declared the policy to

Global Human Resource Management(HRM) Policy●

mobilize the Group's technologies, products, business models
and all other resources, and we acknowledge that it is mostimportant to secure and utilize highly capable employees
who support the efforts.

●

The Group has traditionally attached a high value to humanresources based on the Sumitomo Spirit. To clarify the basic
policies on human resources, we instituted the Sumitomo
Electric Group Global Human Resource Management Policy●(Global HRM Policy) in September 2011.
This policy specifies the Group's commitment to creation ofan environment that helps employees realize growth andself-actualization through work, provision of various career
opportunities regardless of race, ethnicity, national origin,religion, age, gender, gender identity, sexual orientation, or
disability, promotion of diversity and development of global

55 CSR Report 2019●

We provide workplaces where all the employees canwork actively, grow both personally and professionallythrough work, achieve self-actualization, andcontribute to society.
We oﬀer various career opportunities and globally
pursue "the right person in the right position" regardlessof race, ethnicity, national origin, religion, age, gender,
gender identity, sexual orientation, or disability.
We value and promote diversity in the workplacein order to enhance the creativity of the organizationand to sustain the growth of the business.
We develop global leaders who lead and give energy
to our global business. Global leaders arethose who understand and share the Sumitomo Spirit
and the Corporate Principles and can lead highly
diversiﬁed teams.

encourage international employees to work in Japan. We

We will promote the involvement of
SEG Global Executive and other international employees
in the business management

continue to make efforts to improve the supporting program

resource development system that allows talented andqualiﬁed persons to seek career development beyond theborders of individual companies to engage in the

management of Group companies in Japan and overseas or
perform even higher duties. We give board members andequivalents from overseas subsidiaries, except for those oflisted companies, the global leader (GL) grade, and recognizeof whom are executives of overseas Group companies, arerecognized as the SEG Global Executives. They are provided

with a wide range of career opportunities to help them play
more active roles as global leaders.

《 Area Committee 》

We introduced the Area Committee system in 2015 to allow
beyond the borders of individual companies. The system aims
to 1) enhance the presence of each business/base inconsideration of the regional characteristics, 2) make use of

the knowledge and experience of SEG Global Executives and3) establish a network of the SEG Global Executives. We have
set up four committees of Americas, Europe, Southeast

Asia/Australia and Greater China, which are committed to adevelopment and strengthening of manufacturing abilities in
the respective regions.

the proposals presented by the Area Committees into the
management of the Sumitomo Electric Group. In thisconference, which is held in the four regions of Americas,
Europe, Southeast Asia/Australia and Greater China, top

executives of Sumitomo Electric and its overseas affiliates

will continue to make the conference more active to further
promote diversity management in the Sumitomo ElectricGroup and coordination between affiliates.

Area Committees and Regional Executive Conference

SEG Global Executive Conference
SEG Executive
Conference ofEurope(SEECE)SEG Executive
Conference of
APAC(SEEC-APAC)

SEG Executive
Conference of
the Greater China(SEEC-CHINA)

Area Committee

Area Committee

Area Committee

Area Committee

Activities by theme＊

Activities by theme

Activities by theme

Activities by theme

Support from the responsible departments of Sumitomo ElectricWith the aims of providing SEG Global Executives with more
opportunities to demonstrate their abilities and cultivating
the next generation of SEG Global Executives, we will

Our Group companies conventionally formulated their own
human resources rules，established and operated different

HR measures. We recognized that it is necessary to
standardize the HR measures and management processes tosome extent among our Group companies in Japan andoverseas in order to further proceed with group-wide andglobal management based on the Global HRM Policy. In fiscal
year 2017, through collaboration on a global scale involving
HR of overseas companies, we started to issue "Global HR
Document," which clearly states our global HR philosophy,
standards and guidelines on each HR-related topic. We havepublished eight key documents so far. In the future, we will
make steady efforts to implement released documents ateach Group company and also publish documents on new
topics.

CSR VOICE

From overseas to JapanXue Hong

Assistant Manager,
Global Planning Group
Human Resources Development Department

I joined Sumitomo Electric Photo-Electronics
Components (Suzhou), Ltd., which was founded in
October 2007, to engage in the launch of the company
as a Manager of Human Resources and General Affairs,
and have also been committed to the establishment of
the internal HR systems since then. I have also
participated in the Eastern China HR Conference for HR
staff of Group companies in the eastern area of China,
China Leadership Development Program for Group
companies in China and the Global HR/HRD Conference
held in the Head Office in Japan every year. Throughthose experiences, the scope of my duties has steadily
expanded from Suzhou to eastern China, to the Greater
China and then globally.
I have been working in the Human Resource
Development Department at the Head Office of
Sumitomo Electric since April 2018. As a project leader
for the establishment of a global training system, I am
committed to the expansion of SEI University in China.
Since the Head Office is developing large-scale andadvanced initiatives, I would like to learn actively fromthem. After my return to China, I hope to contribute to
the further advancement of human resource
development in Group companies in the country.

Environmental
Preservation《 Encouragement of International Employees to Work in Japan 》《 Establishment of a human resources infrastructure throughthe application of common human resources measures andprocesses to all Group companies in Japan and overseas 》

Human Resources

SEG Executive
Conference of
the Americas(SEECA)

database. Business Units also hold meetings with executives
to identify excellent staff and create development andpromotion plans.

Supply Chain

Sumitomo Electric Board Members Meeting

career opportunities to competent and enthusiastic staff andcultivate and promote them, we are establishing a global HR

Qualitygather every year to discuss global management issues. We

To understand human resources of the Group on a global
scale in a seamless manner, as well as to provide various

Social Contribution

We also use the Regional Executive Conference to incorporate《 Development of a Global HR Database with an aim
to establish processes for development and promotion 》

CoreCategory

wide variety of subjects, such as human resource

for international employees working in Japan.

Group's CSR Activities

SEG Global Executives to participate in business management

selection of the candidates to acceptance in Japan. We will

Governancethem as SEG Global Executives. At present 41 persons, mosthave established guidelines for the procedures from theBusiness Outline

We have adopted the Global Grade System, which is a human

Basis for Management

Global Grade System andGroup Global Executive Personnel System

Glossary ＊Activities by theme

Activities on research, risk management, PR, human resources/HR development, accounting, information system,
procurement, safety & environment and production engineering. The themes for the activities are set for each region.

CSR Report 201956

Women's Empowerment

Ratio of Male/Female Employees and Ratio ofMale/Female Managers in Sumitomo Electric (Note 1)

We strive for Women's empowerment with recognition
that it is one of the driving forces to promote diversity
Sumitomo Electric regards Women's empowerment as one of thedriving forces to promote diversity, and strives for it. We consider

that the development of an environment where women can fully
demonstrate their skills and keep playing important roles will

also lead to the cultivation of culture that helps each employee
work more actively. This is therefore a significant initiative for the
future growth and development of our company.

《 Response to the Act on Promotion of Women's
Participation and Advancement in the Workplace 》

In accordance with ｔhe Act on Promotion of Women's

Participation and Advancement in the Workplace, we set

targets on recruitment of women and appointment of womenand formulated an action plan in March 2016.

We have achieved the targets for both categories ofMale

Full-time
employees
Section managers
or higher positions(Note 2)

Femalepromoting initiatives to meet the targets in the action plan forthe 2nd phase (from April 1, 2018 to March 31, 2020).

● Establishment of the action plan for the 2nd phase■ TargetsCategory

Targets

11,338 persons

2,737 persons 53 persons（98.1％）（1.9％）

2,790 persons(Note 1) Above graphs cover data for Sumitomo Electric employees,
including those on loan to Sumitomo Electric aﬃliates and other organizations.
(Note 2) Section managers or higher positions: section managers,
division managers and management

Group employees in the world (Note 1)
Female143,733 persons
52.7％

Male

129,063 persons
47.3％

Total
number offull-time
employees

Total
number of
section managers
or higherpositions

272,796

Clerical staﬀ: 40% or more
Technical staﬀ: 15% or more

Women's share in
Appoint
assistant managers or
menthigher positions

Section managers or
higher positions: 2.0% or more
Assistant managers: 13% or more

Number and share of women in
section managers or higher positions

30

25

40
20

1.3
32
17
8

10
0

2013

1.4

1.5

38

40
28

22
10

2014

No. of section managers

10

2015

1.9

1.7

53

30
10

2016

34
12
2017

38

（％）
2.0
1.8
1.6
1.4
1.2
1.0

15
2018

(Fiscal year)

No. of general managers or higher positions(Persons)

100
80
60

7.1

7.6

7.8

62

71

73

2014

2015

as of January 16 of each ﬁscal year

9.1
88

10.3
106

11.3
125

（％）
12.0
10.0
8.0
6.0

40
20
0

2013

Number of assistant managers

2016

2017

2018

(Fiscal year)

Share in assistant managers(Note) Above graphs cover personnel data for Sumitomo Electric employees,
including those on loan to Sumitomo Electric aﬃliates and other organizations.

57 CSR Report 2019

88.1％

(Note 1) Sumitomo Electric and its consolidated subsidiaries(Note 2) Section managers or higher positions: section managers, division managers andmanagement (including executive oﬃcers and other oﬃcers)《 Support of Career Development 》

In comparison with men, women are more susceptible to life

events and accordingly tend to have difficulty in imagining theircareer path at present. In 2016, we launched a management

and importance of developing female subordinates and consider
suitable support for the growth of each of them. We also set up

a training program to raise the awareness of female employees

and thereby strengthen the organization as a whole.

as of January 16 of each ﬁscal year

46

Number and Share of Women in
Assistant Managers

120

11,805persons

release the potential of the female employees on general track

Share in section managers or higher positions

140

Male

on general track and their superiors in 2017, with an aim to（Appointment）● Implementation of measures to support female employees
on main career track in their career development● Active development and appointment of competent andenthusiastic female employees on general track● Monitoring of promotion of women in each division● Realization of flexible work styles

1.0

11.9％

female main career track employees to understand the necessity（Recruitment）● PR activities mainly targeting female students● Improvement of capabilities to recruit women

50

1,592

persons

track employees. This program gives lessons to the superiors of■ Initiatives

60(Note 2)

13,397

Femaletraining program for the development of female main career

Women's share in the new
Recruitgraduates for main career
ment
track

(Persons)

Total

9,783 persons 1,555 persons（86.3％）（13.7％）

recruitment and appointment in the action plan for the 1stphase (from April 1, 2016 to March 31, 2018) and are currently

As of March 31
of 2019

Commitment to "SWING"
We will support women's empowerment throughcoordination on a group-wide scale
SWING stands for Sumitomo Electric Group Women's
Innovative Networking Group, which was launched at theinitiative of Sumitomo Electric, Sumitomo Wiring Systems,
Ltd., Sumitomo Riko Co., Ltd. and Nissin Electric Co., Ltd. in
2016. This group provides female employees of theSumitomo Electric Group with opportunities for mutual study
and networking across the companies to cultivate female
employees and improve their skills and to assist women inplaying active roles on a group-wide scale.
In fiscal 2018, we held a forum attended by 65 female
employees on general track from 10 Group companies. Withthe theme of "Let's work energetically and contribute to theteam!," the forum included a panel discussion by arepresentative from each of Sumitomo Electric, Sumitomo
Wiring Systems, Ltd. and Sumitomo Riko Company Limited aswell as a group discussion about the creation of the best andstrongest team, as it did last year. Such an exchange withfemale workers from other companies gave the attendants anopportunity to consider what they can do for their teams andother issues.

Evaluation by External Organizations《 Certification with "L-boshi" 》

We were certified as the top L-boshi company
in August 2016. L-boshi is certification grantedby the Ministry of Health, Labour and Welfare of

《 Selected as a Nadeshiko Brand 》《 Awarded the first prize of fiscal 2018 "Leading Companies
with Actively Participating Women in Osaka City" 》

12.4
8.6

5
0

2013

5.3

2014

7.9

9.3

2017

2018

5.0

2015

2016

(Fiscal year)(Note) Ratio of the number of the employees who were hired as new graduates
three years before the relevant year and have left the company within three
years to the total number of the new graduates hired three years before

Promotion of Employment of the Persons
with Physical or Mental Disabilities
We are making steady efforts to help create a society whereanyone can work vividly with or without their disabilities
Sumitomo Electric has been traditionally working to promote

Governance

Osaka City certifies the companies and other entities that
actively encourage women to work actively as "Leading
Companies with Actively Participating Women in Osaka City"
and grants the mayor's awards to the companies and otherentities involved in especially outstanding activities. In
recognition of our steady efforts for the cultivation,
appointment, etc. of female employees, we received the firstprize in March 2019.

10

Business Outline

In recognition of its outstandingachievement in the encouragement of
women to work actively, Sumitomo
Electric was selected as a Nadeshiko Brand among listedcompanies by the Ministry of Economy, Trade and Industry ofJapan and the Tokyo Stock Exchange in March 2019 for thesecond time following the first in March 2017.

Turnover Rate in Sumitomo Electric（%）
15

Basis for Management

Japan to companies that are outstanding in terms of
encouraging women to play more active roles based on the
Act of Promotion of Women's Participation and Advancementin the Workplace.

employment of persons with physical disabilities. To further

promote employment of persons with physical or mental

disabilities and increase their employment rate, we establisheda special subsidiary＊, Sumiden Friend, Ltd., on the premises of

Sumitomo Electric's Itami Works, specifically for employment ofDiversity in Recruitment

persons with disabilities in July 2008 (certified in February

We aim to promote diversity through recruitment ofa wide range of personnel

Sumiden Friend has expanded its operations gradually to also2009). Beginning with loan and maintenance of foliage plants,

In fiscal 2018, Sumitomo Electric employed 196 new graduates

for main career track in Japan, 49 of whom were female and 18
were non-Japanese and graduates from overseas universities("global" employees). We also hired 163 mid-career employees.
With the awareness of the need for diversification of humanresources, we have set a target of increasing the percentage ofefforts to achieve the target in our activities to recruit new
graduates to be employed in fiscal 2018 and thereafter.

diverse talents can demonstrate their capabilities regardless ofnationality, race, gender, age or other background in the Group.

200

296
51

238

245

100

Female

2013

Male

63

2014

420

2015

2016

total, five of which joined during the period from July 2018 toJune 2019) was 2.29% in June 2019.

Number of Employees with Disabilities at Sumiden Friend as ofJune 15 of each year
2014

2015

2016

2017

2018

28

33

39

45

54

2019

56

2.3

2017

2.2

412

326

2.1

2018

Employment rate as ofJune 15 of each year

（％）
2.4

113

94

322

257

companies including Sumiden Friend, Ltd. (13 companies in(Fiscal year)

2.11

2.17

2.17

2.21

2.29

2.29

Legally required
percentage

2.0
0

2014

2015

2016

2017

2018

2019

(Year)(Note) Total for Sumitomo Electric and its qualiﬁed Group companies including Sumiden Friend, Ltd.

Ratio of Global Employees in the Employees Hired by Sumitomo Electric
8.6(Persons)

200
150

152

141

9.2

4.6

3.0
167

（％）
10.0
6.0
2.0

2.7

177

185

196

Company Limited and Nissin Electric Co., Ltd. have alsoestablished their special-purpose subsidiaries, which are SWS
Smile Corporation, SumiRiko Joyful Company Limited andNissin Heartful Friend Co., Ltd., respectively. An exchange

meeting between these subsidiaries was held twice in 2018 to100

facilitate their coordination.

50

13

2013

4

2014

5

2015

New graduates for main career track
Ratio of global employees

8

2016

5

2017

We will continue to develop a system to create places where

18

2018

(Fiscal year)

Global employees among them

(Note) Employees who were hired in months other than April are included.

persons with disabilities can work while feeling rewarded inmany Group companies and worksites and to ensure that all

Group companies will achieve and maintain the legally required
percentage in response to legal revisions and other changes.

Environmental
Preservation0

In our group, Sumitomo Wiring Systems, Ltd., Sumitomo Riko
Human Resources

2.8

Supply Chain

0

320

281
43

mentally disabled for Sumitomo Electric and its qualified Group

Quality300

result, the overall employment rate of the physically or

Employment Rate of the Physically or
Mentally Disabled by Year

525
381
59

bases including Yokohama, Tokyo and Osaka branches. As a

(Persons)(Persons)400

the company, including 56 persons with disabilities, in the four

The disabled

Number of Male/Female Employees Hired by
Sumitomo Electric (All Functions)500

waste paper. As of June 2019, 94 employees are working at

Social Contribution

We will continue to take various measures to ensure that

documents into electronic files and shredding and recycling ofCore
Category

global employees to 10% or more and are currently making

600

Group's CSR Activities

engage in the conversion of drawings and other paper

Glossary ＊Special-purpose subsidiary

The subsidiary is established by a company for the purpose of hiring persons with disabilities under the Law for Employment Promotion etc. of the Disabled.
Permission from the national government is required for the establishment. Persons with disabilities employed by a special-purpose subsidiary can be considered
to be the parent company's (or corporate group's) employees when the percentage of the employment rate of persons with disabilities is calculated.

CSR Report 201958

Safe and Sound Workplace
Work Style Reforms
Sumitomo Electric promotes company-wide campaigns withthe aim of ensuring that employees can achieve the properbalance between work and life in order to create a workplacethat allows diverse staff to work comfortably
We have conducted various initiatives for work style reforms
since 2008, including the promotion of work styles thatbalance work and life and the review of the operations of eachdivision to improve the efficiency. At present, we conduct bothcompany-wide and division-specific initiatives to review work
styles and thereby reduce total annual working hours,
encourage employees to take paid holidays and improve work
efficiency and productivity. One of the initiatives is a system of
paid holidays that can be taken by the hour, which wasintroduced in 2018. With this system, we aim to establish amechanism that meets various needs including those for childrearing, provision of nursing care and a visit to a hospital andallows employees to take paid holidays more easily.
In 2019, we plan to introduce a "work-interval system," whichaims to ensure that employees have a sufficient amount of rest
from the finish time of a day to the start time of the following
business day, on a trial basis. Through this initiative, we will
strive to maintain the health of employees and also sustain andfurther improve productivity.
We are taking measures in response to the issues of individual
workplaces and persons identified based on findings in the

Implementation of the Survey toCreate a Lively Working Environment
We have added questions about progress inthe dissemination of the mid-term management plan,
as well as questions about harassment, for
the understanding of the current situation of each workplace
Sumitomo Electric has been conducting Survey to Create a
Lively Working Environment, a questionnaire survey toinvestigate the awareness of employees, since fiscal 2006. In
fiscal 2018 as well, about 22,000 employees of Sumitomo
Electric and Group companies were surveyed, including staff ofsome overseas Group companies.
The content of the survey is reviewed every year. While theresults for most of the items checked for the change over time
showed improvement, there were still issues to be addressedin some areas including "Career Development" and we havedesigned and implemented personnel measures or training to
respond to them. In addition, we started to analyze thecorrelation between the survey results and the results of thestress check, which measures the stress level of individuals, infiscal 2018. The overall results are fed back directly to the
responsible person in each organization to encourage each
workplace to consider specific measures against the issues andto use the results for the establishment of workplaces where
people can work in a healthy and energetic manner.
Results of the Survey to Create a Lively Working Environment
Dissemination ofBusiness Spirit andCorporate Principles

Survey to Create a Lively Working Environment, a questionnaire
survey to investigate the awareness of employees, with an aim
to make the workplaces more attractive.

Manager'sManagement

We now set the slogan of "Be brave to change, be serious to

Workplace Discipline

work and be patient to continue" and conduct initiatives from
culture and awareness, as well as enhancement of productivity
work rules and processes. We will continue to review the work

performance, for the growth of our business.

Average number ofpaid holidays taken by
employees per year

2014

2015

2016

2017

2018

19.3

20.4

20.8

20.2

19.3

18.7

10.4

12.1

12.1

14.1

16.0

16.5

days

days

hours

days

hours

days

hours

days

(Note) Average among labor union members of Sumitomo Electric from January
to December in each year

Average Total Working Hours by Year
(Hours)

2,100
2,050

2,042

2,042

2,047

2,024
1,999

2,000

1,988

1,950
0

2013

2014

2015

2016

2017

2018

(Year)(Note) Average of the total working hours in each year from January to Decemberof each of the Sumitomo Electric employees (including those on loan to
Sumitomo Electric aﬃliates and other organizations within the Works)

FY 2018
FY 2017
FY 2016

3.57
2

3
5-grade scale

4

5
Good

Support for Balancing Work and LifeWe actively promote the development ofchild and family-care related systems
To support employees in balancing work and life, Sumitomo
Electric is committed to promoting the work style that achieves
the proper balance between work and life and has also developed
child and family-care related systems actively. For these efforts,
the Company has been certified by the Ministry of Health, Laborand Welfare as a company that helps its employees balance workand childcare based on the Act on Advancement of Measures to
Support Raising Next-Generation Children.
In fiscal 2018, we newly allowed employees to use the work fromhome arrangements for other purposes than child rearing andnursing care and also introduced a system of paid holidays that canbe taken by the hour so that employees can work in a more
flexible manner. We also use training sessions
and in-house magazines on nursing care to give
relevant information and encourage them toprepare for the achievement of a balance
between nursing care and work. Through thesemeasures, we are working to help employees Special certiﬁcation mark"Platinum Kurumin"＊balance work and life now and in the future.

Glossary ＊Special certiﬁcation mark "Platinum Kurumin"

59 CSR Report 2019

3.39

0
Bad

2013

days

3.34

Satisfaction in
Working

Average Overtime Hours and Average Number ofPaid Holidays Taken by Employees by Year

hours

3.47

Communicationin the workplace

contribute to the maintenance and improvement of business

hours

3.26

Motivationstyles, which will not only reduce working hours but also

hours

3.95

Devotion to Job

through the use of infrastructure and IT tools and the review of

Average overtime
hours per month

3.59

Workplace
Atmospherevarious perspectives including efforts to change the corporate

Year

3.65

The Minister of Health, Labour and Welfare granted this mark to Sumitomo Electric for achieving the goals set under its First Action Plan(from April 2005) to Sixth Action Plan (to March 2018) based on the Act on Advancement of Measures to Support Raising Next-Generation
Children, as well as for meeting the certiﬁcation criteria for special cases set by the Ministry of Health, Labour and Welfare.

《 Work from Home Arrangements 》

We introduced work from home arrangements, which allows
employees who face restrictions on their work due to

We support the life of each employee in various aspects

childcare, nursing care, etc. to work at home or other locations
in fiscal 2016. On October 16, 2018, we started to allow other《 Reemployment System 》

In April 2008, Sumitomo Electric introduced a scheme toreemploy employees resigning due to circumstances beyond

include the realization of flexible and efficient work styles andthe improvement of productivity through the review of work

persons when they are able to return to work (within three
years or, for those who moved overseas, five years from theirresignation) and, as a general rule, assign them to theirstyles. We will continue to work to enhance the flexibility ofworking styles and develop an environment where diverse
human resources can play more active roles.

former workplaces.

《 Volunteer Holiday System 》

who is assigned overseas and return to work after the leave.
This system allows temporary retirement in such a situation

used for various social contribution activities such as coachingof local children in sports activities and accompanying of

In April 2017, we introduced a system in which an employee
can take a leave of absence to accompany his/her spouse

Employees can take up to 10 holidays in a year to engage involunteer activities approved by the Company. This system iswith the aim of preventing employees from retiring.

children on trips for residential training and games.

《 Childcare Centers 》《 Childbirth and Rearing Support Program 》

In the activities to find childcare facilities to take care ofchildren ( hokatsu in Japanese), various kinds of know-how
are needed because the approach and schedule of suchactivities depend on the childcare environment in the placeof residence and the month of birth of the children.
This Hokatsu Concierge system, which was started inand the organization of a networking event for international
employees to know each other.

on childcare facilities, is provided in this system.

Male

FemaleTotal

Employees who used
the short-time work system

Enrollment in thereemployment system

Male

Female

Total

Male

FemaleTotal

Users of
Users of
Users ofinternal child the volunteer
the workcare centersholiday
from homefor children
systemarrangements

55

21

245

266

3

23

26

62

7

‑

2014

16（12）134（54） 150 （66）

71

19

264

283

1

29

30

57

7

‑

2015

29（28）124（57） 153 （85）

92

20

276

296

1

30

31

56

9

‑

2016

40（25）137（42） 177 （67）

94

22

262

284

1

25

26

57

8

18

2017

52（52）105（49） 157
（101）

112

19

263

282

0

23

23

52

6

40

2018

46（35）108（39） 154 （74）

121

19

268

287

4

24

28

59

5

209

The number in brackets indicates the number of the employees who took the leave for the ﬁrst time in the ﬁscal year.

(persons)(Note) The table above covers data for Sumitomo Electric employees, including those on loan to Sumitomo Electric aﬃliates and other organizations.

CSR Report 2019

Environmental
Preservation

15（13）106（56） 121 （69）

Human Resources

2013

Supply Chain

Number of Users of the Employee Support Programs
Employees who
took leave when
their spouses
gave birth

Qualitytransportation expenses and other items, issuance of pay
slips and internal regulations in English, creation of prayer
rooms in Osaka Head Office and Osaka Works, training
sessions to become familiar to the business culture in Japan

November 2014, aims to help employees during childcare
leave return to work smoothly at the time she hopes toreturn. Know-how on hokatsu depending on thecircumstances of individual employees, as well as information

Social Contribution

To create a work environment where international
employees can work comfortably, we set up a project teamin the HR Division in 2017. The team has taken various
measures to support them, including the establishment of a
support desk where staff can give support in Japanese,
English and Chinese, development of bilingual systems(Japanese and English) for time tracking, business tripCore
Category《 International Employees Support Project 》《 Hokatsu Concierge System 》

Group's CSR Activities

For female workers during pregnancy and parenting, it isespecially important to have dialogue with their superiors in a
detailed manner.
In fiscal 2015, we introduced a system to organize dialogue
between such an employee and her superior when she isfound pregnant, one month before maternity leave, before
return to work from childcare leave and two months after
return to work from childcare leave, to help her return towork smoothly and work actively after the return fromchildcare leave.

As a measure to foster a supportive environment for
employees working full-time while raising children, Sumitomo
Electric opened childcare centers at its Yokohama and Osaka
Works in March and April 2008 respectively and Itami Worksin March 2009. In 2018, a new childcare center was
established in the neighborhood of our Tokyo Head Office.
As of March 31, 2019, these centers take care of 59 children
in total.
In addition, for employees who cannot use our childcare
centers, we are taking other supportive measures such as
subsidizing their use of other childcare centers.

Governance《 System to take a leave to accompany his/her spouse
who is assigned overseas 》

Employees who tookchildcare leave

Business Outline

employees who meet specific requirements, such as abilities
to autonomously fulfill duties and make achievements, to use
the system. The purposes of the expansion of the system

their control such as childbirth, childcare and nursing care. In
the scheme, we organize interviews and reemploy eligible

FY

Basis for Management

Various Types of Support

60

Sumitomo Electric Group
Health Management Declaration

also station counselors in and outside the company toestablish a system where employees and their family members
can consult with them.

Toward the realization of health and productivity management＊《 Prevention of Passive Smoking 》

We consider that the Sumitomo Electric Group cannot achievesustainable development or growth without the health of each
employee. Announcing the Sumitomo Electric Group HealthManagement Declaration in 2015, we launched "Kenkatsu!"＊
activities in June 2017 to manage and improve the health of
employees in workplaces and have since actively supported
the health promotion activities of employees.

《 Initiatives to Prevent and Improve Metabolic Syndrome 》
To prevent metabolic syndrome and reduce the employees
who have its symptoms, we promoted special health guidanceand dealt with the following issues:
Improvementof thedietary life

Improvementof theexercisehabitsEnhancementof special
healthguidance
Preventionof cancers

Dietary life seminar: Attended by 256 persons
Learned about dietary balance and intake
Walking event: Joined by 1,934 persons(3-month program to meet the target of walking
8,000 steps in a day)
Gave rewards to the participants and made donations
to areas aﬀected by the heavy rain in western Japanaccording to the total number of their steps

Exercise habit seminar (for prevention andimprovement of metabolic syndrome) by sports
trainers: Attended by 463 persons in total
3-month intensive lifestyle improvement programby health nurses of Sumitomo Electric and sports
trainers: Joined by 85 persons●

Recognition as a Sports Yell Company:

We were recognized as a Sports Yell Company by
the Japan Sports Agency in December 2018 for ouractive engagement in the implementation of sports
activities for the health promotion of employees.
While also involving Group companies, we will continue topromote various health promotion measures to realize healthand productivity management.

The union and management are committed tosolving various problems through in-depth discussions

Invited baseball, table tennis and soccer players
including former Japanese national team members

Athletic exchange meeting by Sumitomo Electric
Track and Field Team
Athletic lessons for elementary school and juniorhigh school students jointly organized with Itami
City, Hyogo: Joined by 2,204 persons in total(held 17 times)
Games between baseball clubs and circles of thesix business locations: Joined by 262 persons
Subsidy for ﬁtness gym (monthly or annual)memberships: Used by 2,052 persons
Subsidy for expenses for the purchase of sports
items: Used by 1,272 persons《 Mental Healthcare 》

We distributed a related handbook to all employees andprovided "self-care" training, which was taken by 316 persons,as well as "care by supervisor" training for management-level
employees, which was taken by 434 persons. In addition, we
started new working environment improvement activities(named "workplace health checkup") based on the results ofstress level tests to create a more comfortable workplace. We

Glossary ＊Health and productivity management

61 CSR Report 2019

In recognition of our strategic commitment
to the health management of employees
from a management perspective, Sumitomo
Electric was certified as a 2019 Health andProductivity Management Organization(White 500) in February 2019 by the
Ministry of Economy, Trade and Industry ofJapan and Nippon Kenko Kaigi.

Cancer seminar by Dr. Keiichi Nakagawa,
Associate Professor of Tokyo University Hospital:
Attended by 72 persons

Sumitomo Electric Sports Academy: Joined by 800
persons

Subsidy for
expenses
for sports
activities：● Certification as the "White 500"

Labor-Management Relationship

We organized the following programs to encourage employees
and their family members as well as local people to engage insports and have exercise habits:

SEI
Challenge
Cup《 External Assessment 》

The participants reduced their weight by 6.6 kg, abdominal
girth by 7.7 cm and body fat by 3.2% on average《 Contribution to Sports Activities 》

Sportslessons

We closed 417 indoor smoking areas including those in Group
companies during the period from July 2017 to March 2019.
Through continuous efforts including the establishment of a day
to encourage employees to quit smoking and the organizationof seminars to encourage them to do so, we aim to create aworking environment with no passive smoking.

A registered trademark of Workshop for theManagement of Health on Company and
Employee, an NPO＊ Kenkatsu!

Sumitomo Electric believes that the development of a company
goes hand-in-hand with the well-being of its workers' union
members. On the basis of this belief, Sumitomo Electric strives toaddress various relevant issues by thorough discussion between
the union and management, each party respecting the other's
standpoint. In particular, the Central Management Council
Meeting, which is held four times a year, has a history of about
70 years, and has served as a forum for exchange of opinions
between representatives of the union and management
concerning business environments and managing conditions.
While working styles are increasingly diversified, we have also set
up expert committees of various kinds to create an environment
where all employees can work lively with smiles by improving
various working systems and reinforcing monitoring functions.

Organization of Town Meetings
We provide employees with opportunities to havedirect dialogue with executives and make use of
their opinions to facilitate various initiatives

To enhance communication inside the Company, we organize
town meetings at each of our sites, in which a group of
employees from different sections directly and openly talk withboard members, general managers or other executives. The
participants have precious opportunities to inform theexecutives of problems and requests concerning humanresource development, promotion of diversity and work stylereforms, as well as those specific to their functions, and sharesuch problems to seek clues and solve them. The opinions andother comments presented in the meetings are communicatedto the relevant divisions on a timely basis and used fororganizational operation, planning of personnel systems andother purposes, as well as for the facilitation of the initiative.

A coined term used in Sumitomo Electric to collectively refer to health maintenance and improvement
activities promoted in companies and worksites and by individuals to extend healthy life expectancy anddevelop a sense of unity in worksites. The three key activities are "prevention and improvement of metabolic
syndrome," "promotion of sports and improvement of exercise habits" and "mental healthcare."Human Resources Development

Personnel needed by Sumitomo Electric are defined as those
who honor the Sumitomo Spirit, understand the Sumitomo

Electric Group Corporate Principles, possess high levels of skill

and knowledge rooted firmly in the basics, and who can play

active roles in the global community. We provide various training

the Sumitomo Spirit in their own words in their new
workplaces is organized before the transfer. We are also
cultivating internal lecturers to enable the Sumitomo Spirit tobe learned periodically in Group companies in Japan andabroad.

Training categories of SEI University

motivation for self-development and on-the-job coaching andclose communication between superiors and subordinates.

SEI University

HumanskillsProblemsolving
skillsTechnical skills

Manufacturing

The Sumitomo Spirit

SEI University represents the Sumitomo Electric Group's

comprehensive training and education system. With the aims ofachieving corporate targets and becoming a Glorious Excellent
Company, we provide various training programs in a wide rangeof areas at SEI University.

SEI University will serve as a venue for:① Disseminating the Sumitomo Electric Group's corporate philosophy,② Sharing the Sumitomo Electric Group's management strategies
and vision, and③ Developing employees' abilities, skills and knowledge so thatthey may play active roles in the global community.

Corporate philosophy

Record of the training sessions organized acrossthe Sumitomo Electric Group in FY 2018
Applicable employees

Total number ofparticipants(persons)

Total length oftraining(hours)Sumitomo Electric employees

65,369394,101

Employees ofGroup companies in Japan

21,493

94,607

Employees ofoverseas Group companies

10,16355,280Total

97,025543,988

Record of unique training sessions organized inindividual Group companies in FY 2018
Applicable employees

Total number ofparticipants(persons)

Domestic Group companies(26 companies)

Total length oftraining(hours)34,228184,009

Overseas Group companies(83 companies)

147,967

330,550

Total

182,195

514,559

SEI University（OFF-JT）

Management By
Objectives
Dialogue on Career

OJT

We have conventionally operated a system that has superiors
interview with their subordinates about self-enlightenmentand career development when annual business targets areset, and also continue to organize training that helps

SEI University provides more than 300 training programs

understand the importance of the dialogue and specificmethods to promote it.
In the training session for superiors, they learn (1) the

position-based compulsory programs for all group employees
ranging from executives to new employees, in the three areasof human skills, problem-solving skills and technical skills. Our
Group companies and divisions also organize their original

the importance of motivating subordinates to work andattaching meanings to their jobs in (1) and learning thedevelopment of an atmosphere for dialogue, attentive(commonly developed across the Group), including

opportunities to learn about it in the training programs for
new employees and various position-based training

programs. In addition, we always explain the relations of theSumitomo Spirit to compliance and human rights in therelevant training programs.

video once in six months and the video is also translated into
multiple languages and distributed to Group companies inJapan and overseas. For the employees to be assigned
overseas, a training program to ensure that they can convey

video of real interviews and exchanging opinions on goodand bad points in the video with each other. We also provide
them with opportunities to exchange information on the

problems they individually face so that they acquire skills andknowledge that can be used in dialogue with subordinates.

For subordinates, we organize a training session that makes
them consider their career and encourages them to share thecareer they envisage with the superiors through the dialogue.
We also provide training to newly promoted management
staff and employees who have reached the age of 50 toprompt them to reflect on their own career and examine
what in the career was interesting for them and why. The
participants also consider their future career through group
discussions in the training.

CSR Report 2019

Environmental
Preservation

Furthermore, the president asks all employees to performtheir duties in accordance with the Sumitomo Spirit via alistening for receiving empathy and how to ask questions in(2), the superiors deepen their understanding by watching a

Human Resources

trainees acquire the unique knowledge and skills especiallyrequired in the respective workplaces.
In particular, the Sumitomo Spirit is positioned as the basis for
employees to perform their duties. We give themnecessity of dialogue on career and (2) specific methods topromote dialogue, as basic knowledge. After understanding
Supply Chain

training programs in the field of technical skills to have theQuality

The Sumitomo Spirit
Corporate philosophy

We help employees consider their career andbe committed to their growthSocial Contribution

Promotion of Dialogue on Career
Employee
performance evaluation
Job rotation

Core
Category

Human Resources
Development

ExpertiseGroup's CSR Activities

Fundamental Principles of SEI University

Basicliteracy

Governance

We work to improve the value ofhuman resources throughout the Group

Business Outline

programs to support employees in becoming such personnel
based on the concepts of the individual employees' strong

Basis for Management

Personnel Needed by Sumitomo Electric62Addressing Globalization across the GroupWe develop training activities globally across the Group①Development in Group companies in JapanTo promote human resources development across theSumitomo Electric Group, we provide employees of ourGroup companies in Japan with opportunities to attend

training sessions organized by Sumitomo Electric. The numberof the participants from our Group companies in Japan in the

training for new employees, mid-career employees and newly
promoted personnel is increasing year by year.

When it is difficult for a Group company to run training

programs, internal lecturers are delegated from Sumitomo
Electric to provide necessary training and other services.

②Development on a global scale

To promote the development of human resources that meet

local demand, HR manager meetings are held regularly on acountry basis to discuss the planning and operation ofvarious training programs with focus on those for generalemployees. In addition, persons in charge of HR developmentin our Group companies across the world are invited toJapan once a year to hold the Global Human Resources

Development Meeting and discuss the development systemcommonly applied on a global scale.

We also organize the following training programs for
management personnel commonly in Japan and overseas.
Target： Executives

Executive training program

Executives are developed through action learning as wellas understanding of the Sumitomo Spirit and acquisition ofmanagement knowledge. This training program is held
once a year and attended by about 50 persons each time.
Target： General Managers

Global Leadership Development Program (GLP)

Human resources that can show leadership on a global scale
are cultivated through discourses of executives, leadershipworkshops and understanding of the Sumitomo Spirit. The
program was held twice a year until 2015 and is held once a
year from 2016. Each session receives about 30 participants.
Target： Managers

SEG Management Program based on
the Sumitomo Spirit (MPSS)

This program aims to diﬀuse the Sumitomo Spirit andimprove skills to manage subordinates. The sessions areprovided in six cities in Germany, the United States,
Singapore, China (Shanghai and Shenzhen) and Mexico anda total of approximately 150 persons attend the common
program in those locations in a year.

The Number of Participants in MPSS (cumulative total)(persons)
800

740

700

576

600
500

436

400

270

300
200
100
0

63 CSR Report 2019

59
2013

144
2014

2015

2016

2017

2018

(Fiscal year)③Response to globalization in the Company

In line with progress in the globalization of our businessactivities, international employees working in Japan are also
increasing year by year. To develop an environment where all
employees can play an active role beyond differences inlanguage, culture or value, we enhance our Japanese
language training program for international employees andprovide them with training on the business culture in Japan
as part of the project to support them. We also give training
for workplaces to ensure that those who receive international
employees can properly understand the issues to be noted.

CSR VOICE
I am impressed with
the Sumitomo Spirit, which has
a history of 400 years
Monica Carreño

Senior Staff, HR & Administration Department
Sumitomo Electric Sintered Components México,
S.A. de C.V.

I learned the Sumitomo Spirit for the first time in a training
session for new employees. Although the explanation in thesession was not detailed, I became keenly interested in the
Sumitomo Spirit. Later, I luckily had an opportunity toparticipate in MPSS. In the program, I understood thegreatness of the Sumitomo Group, to which I belong, andhad a different impression of the company. I was especially
impressed with the fact that the spirit, which has
underpinned the history of Sumitomo for 400 years, is still
effective in the current era.
Moreover, in March 2019, a young employee of the Human
Resources Development Department, who was sent to ourcompany as a trainee from Japan, provided us with training
to cultivate internal lecturers to teach the Sumitomo Spirit.
Her lecture was so enthusiastic and I recognized that she
was talking sincerely based on the true understanding of thespirit. I was extremely struck and felt that I must accurately
communicate the Sumitomo Spirit to employees responsiblyas a lecturer next time. As she did, I would also like to tellwhat I believe to employees in an honest andcomprehensible manner.

CSR VOICE
For the dissemination of theSumitomo Spirit in Group
companies in Greater China
Tian Weijun

Deputy General Manager,
HR/Admin. Department
Sumiden Asia(Shenzhen) Co., Ltd.

In February 2019, I participated in a training session tocultivate trainers on the Sumitomo Spirit for the personnel
and training managers in Group companies in South China,
which was held at the Shenzhen Office of Sumitomo ElectricManagement (Shanghai) Co., Ltd. The lecturer, who was a
Chinese employee currently belonging to the Human
Resources Development Department in Japan, described
the history of Sumitomo and the Sumitomo Spirit in a waythat Chinese people can understand them easily. I also
learned skills and know-how for lecturers, which are very
helpful when I provide training.
I was able to understand that the Sumitomo Electric Grouphas maintained its operation through various eras because
the Sumitomo Spirit has been handed down as spiritualsupport for employees. Accordingly, each employee isrequired not only to passively recognize and understand theSumitomo Spirit but also to actively and consciously act andpass it down to the people around him/her. As a member ofthe Area Committee in Greater China, I will cooperate with
SMS and the Human Resources Development Department inJapan to instill the Sumitomo Spirit in Group companies inGreater China more widely and deeply.

Basis for Management

Cultivation of Manufacturing Personnel
Based on the basic concept that manufacturing ishuman resources development, we promote cultivationof manufacturing personnel through the three main
initiatives of ① basic training on manufacturing,② practical training and ③ small group activities
is to learn with actual machines and products. Subjects in the

Sumitomo Electric Group Small Group Activity Convention

curriculum are wide ranging from SEQCDD, which are essential

for manufacturing, to the Group's proprietary technologies andtechniques and the latest technologies including equipment
control and maintenance technologies. The number of theparticipants is also growing every year. Overseas as well, we
maintenance of equipment in China and Southeast Asia.

The practical professional training is given in programs that aim
to cultivate key personnel who are anticipated to drive

manufacturing innovation and reinforce the SEQCDD

competitiveness. Important challenges of the respective

divisions are selected as the themes, and trainees are assigned
to the divisions of their themes to perform practical activities
The small group activities (called "SGA") are developed andpromoted to solve problems and achieve objectives voluntarily
on a workplace basis with the aims of developing humanresources and energizing the workplace.

Among these three key activities, we placed particularemphasis on the following initiatives in fiscal 2018.

This program aims to develop "strong" plant managers

Namiko Miura
Hiyokko Group
A.L.M.T. Corp.

Through the small group activities, I learned theimportance of cooperation between different divisions andcompletion of efforts. Although I felt that I had to do
everything as the leader with a sense of responsibility at
first, the members always helped me when we engaged in
the activities. As a result, we overcame failures andsuccessfully achieved the target. I realized the significanceof small group activities, which is that the united efforts ofall members can produce greater results than the activitiesof the leader alone.
I am proud that we received the Best President's Awardand would like to thank the members who have worked
with me, as well as the divisions that supported us.
The activities gave me an opportunity to grow a lot.

(equivalent to the manager of a manufacturing section) who
will play a pivotal role in manufacturing. In the program,essential for plant managers in a six-day training course andthen have an opportunity to deepen their understanding

through practical operations. In the meantime, to create"strong" plants, those who are appointed as plant managers
participate in a two-day training course and a designateddevelop 20 to 30 plant managers or so every year through thisprogram and also use it to cultivate general managers ofoverseas manufacturing divisions in the future.

● Sumitomo Electric Group Small Group
Activity Convention

also been introduced into overseas companies and expanded
to involve a total of 38,000 participants from 179 companies
across the Group in activities on 2,966 themes in a year.

The Sumitomo Electric Group Small Group Activity Convention

was held in Osaka in August 2018 with the participation of 10
divisions and four groups representing four overseas areas(Americas, Europe, China and ASEAN).

After a rigorous evaluation, Hiyokko Group from A.L.M.T. Corp.,

the representative of the Industrial Materials Group, won theBest President's Award, followed by Ruizhi Group from

Sumitomo Electric Photo-Electronics Components (Suzhou), Ltd.,
Each of the representative groups made a presentation about

the achievements of their activities in an enthusiastic manner,which made us aware of the improvement in the activities on a

Winning the Special Award in the Small Group Activity
Convention was a moment of pride for not only thepresenters and the group but also all people working in SPEC.
Ruizhi Group, which is one of the eight groups involved in
improvement activities in Suzhou Plant of SPEC, is in charge ofmass production of optical transmitter/receiver modules for
optical communication. A major challenge for us is to
respond to changes, especially a sudden increase, in the
demand. In our activities, we achieved error-free delivery bytraining workers who were transferred from other lines tomake them effective operators for a short period of time.
A sudden growth in demand substantially changes thesituation for the production line and poses challenges
about various issues including education, training, efficiency
and quality. We became more aggressive and developed
teamwork by considering solutions by ourselves, instead ofleaving them to others, and providing ideas to each other.
In addition, we feel that the experience also made us more
active in housework and child rearing.
We are glad that we realized "the company that makes us
feel proud of working there," as mentioned in thecompany's slogan, through the activities.

global scale.

CSR Report 2019

Environmental
Preservation

the representative of China, which received the Special Award.

Ruizhi Group,Sumitomo Electric
Photo-Electronics Components(Suzhou), Ltd. (SPEC)

Human Resources

groups in total, consisting of six groups representing domestic

Qiu Fang (left),
Li Yueqing (right)

Supply Chain

Sumitomo Electric launched SGA in 1958. This initiative hasSpecial Awardin the Small Group
Activity Convention

Qualityworkshop that is held once in three months. We plan to

CSR VOICE

Social Contribution

assistant plant managers learn the concepts and knowledge

Core
Category● Program to develop plant managers

Best President's Awardin the Small Group
Activity Convention

Group's CSR Activities

for the solution of the challenges and problems.

CSR VOICE

Governanceregularly provide training on basic knowledge and theBusiness Outline

The underlying concept of the basic training on manufacturing

64

To Be the Safest Company in the World
Basic Approaches

on-site inspection, etc. When it is difficult to design measures

The Sumitomo Electric Group considers that securing ofdevelopment, the relevant division will cooperate withhealth and safety of employees is the basis of the business.

We promote the establishment of culture to prioritize safety
above all else and continuously perform safety and healthactivities involving all employees to eliminate risk factors fromto deal with an issue that is closely related to technical
Manufacturing Management & Engineering Unit to promote
the safety of the equipment.

our workplaces with the aim of becoming the world's safest

Priority Safety Activities

Sumitomo Electric Group Safety and Health Targets. To meet

We are promoting measures to separate forklifts from people

company. Specifically, we have set medium- to long-term

the targets, we specify priority activities and priority subjects
for each fiscal year at the Health and Safety Committee,

which is composed of members from management and theunion.

(Separation of Vehicles from People)
to prevent serious accidents involving forklifts. In fiscal 2018,
we defined a set of levels on the progress of the measures tobe commonly applied across the Company, and the divisions
launched activities to raise their respective levels. We will

Sumitomo Electric Group Safety and Health Targets

make efforts to ensure that all sites can reach the level where
simple management methods using simple fences, chains,

1．Realizing accident-free worksites andcreating comfortable working environments

etc. have been adopted by March 2021.

2．Maintaining and improving compliance《 Strengthening of the measuresin the S -T-O-P accident campaign 》

3．Promoting employees' physical and mental health care

The S-T-O-P accident campaign underlies the establishment

Priority Safety Activities(Equipment Systems)

In the "Power OFF Activity," we identify risks in the operationsof a culture of safety and represents rules stipulated by
the company. While recognizing that it is a foundation of
our work and positioning it as an item that must be
followed by all employees, the Sumitomo Electric Groupin which workers may directly touch or approach any rotating

as a whole is committed to the S-T-O-P accident campaign.

or moving parts and then promote equipment safety

S Do not take a short cut and watch your step;measures (hardware-related measures) to address them. In
fiscal 2018, we started to manage the identified risks basedon a company-wide registration system in domestic sites withthe aim of completing the hardware-related measures. For
any uncompleted hardware-related measure for an operation,a registration sticker is put, the operators are informed of theuncompleted measure and the manager/supervisor in charge
checks the predetermined details of the operation through an

T Do not text or talk on the phone while walking;
0 Hold on to the handrails when using stairs; andP Do not put your hands in your pocket while walking
We will improve the campaign to further enhance theawareness of safety among employees.

Targets and Results in Fiscal 2018
Targets for FY2018

Safety VISION
2022

Results in FY2018

Safety measures in facilities

Reduced accidents that can result in a serious accident

Development of human resources withhigh safety awareness

Provided new training programs on a trial basis,
which were received well

Establishment of safety culture

Disseminated the slogan "All accidents can be eliminated"

Priority safety activities① Activities to prevent serious accidents② Safety! Power OFF activity

Activities ineach site③ Hearing of problems by top management

Continuously conducted the voluntary inspection

Activities to be conducted continuously

Continued the 1-2-3 activities① 1-2-3 activities

Developed the S-T-O-P accident campaign② S-T-O-P accident campaign③ 3-pillar safety management④ Thorough training for unskilled workers

Group-wide
structural
reinforcement
activities

65 CSR Report 2019

Emergency /priority safety management activities
Safety education
Plant disaster prevention
Global safety diagnosis
Strengthening of group-wide sharing ofbest practices

Continued to implement both emergency /priority safety management activities
Plant disaster prevention
Started to strengthen the supervision of construction work
Global safety diagnosis
Enhanced the completion of activities with follow-ups
Group-wide sharing of best practices
Conducted interdivisional meetingsparticular, accidents by inserting a hand into rotating or moving

Executives show their commitment to safety andlead by example

considered to be an outcome of our past efforts. On the otherIn accordance with our policy that a culture of safety can be
fostered when executives provide leadership and especially
was attended by all executives ranging from the president togeneral managers of the divisions while inviting external
lecturers.
In the training session, based on the belief that safety is the
top priority and all disasters can be prevented, theattendants reviewed safety from the aspects of its impact on
business and risk management and had discussions as part ofvarious issues for the establishment of a foundation for safety
activities, including the theory of leadership to motivate
others as a practical skill.
The session finished with the rediscovery of their own roles
and the declaration of their respective commitment.
In the future, we will work to develop safety culture in thethe general managers who lead by example in the respective
divisions. The ultimate goal is the creation of an organization

is a challenge to enhance the safety awareness of employees.
In fiscal 2019, we are making efforts to achieve a target ofzero serious accidents and accidents resulting in remaining
disabilities, 50 or less accidents resulting in lost work time,
no lost work time accidents or accidents causing minor injury
and an accident score of 212 or less in the Sumitomo ElectricGroup (including the employees of the Sumitomo Wiring
Systems Group) as part of our commitment to "becoming acompany with the highest level of safety in the world."
Specifically, we will 1) implement safety measures in facilities,
2) develop human resources with high safety awareness and3) foster a culture of safety, which are the core initiatives of
Safety VISION 2022. We will particularly take measures toachieve "zero Power OFF Activity accidents" including theacceleration and completion of hardware-related measures,
as well as measure to achieve "zero accidents attributed tounsafe actions" including the promotion of the S-T-O-P
accident campaign.
Accidents involving injuries

where all employees enlighten each other.

Sumitomo Electric GroupTotal

In fiscal 2018, the number of the accidents involving
injury increased slightly from fiscal 2017
During fiscal 2018, we had a total of 39 accidents, which
27 no lost work time injuries and 5 minor injuries (excluding
employees of the Sumitomo Wiring Systems Group) and theaccident score was 162. Thus, while we set a target of zero
serious accidents and accidents resulting in remaining

Overseas

Japan

Overseas

11

4

0

3

7

0

4

No lost work
time injuries

36

16

8

3

27

1

8

Minor
injuries

20

1

4

0

5

2

13

Accidents
resultingin lost work
time

Total

67

21

12

6

39

3

25

Accidents
resultingin lost work
time

14

5

3

2

10

0

4

No lost work
time injuries

36

11

10

4

25

1

10

Minor
injuries

17

3

3

1

7

3

7

Total

67

19

16

7

42

4

21

(Note) The data on employees of the Sumitomo Electric Group cover Sumitomo Electric andits 110 aﬃliates (excluding Sumitomo Wiring Systems, Ltd. (SWS) and the other listedcompanies), as well as the companies that are not aﬃliates of Sumitomo Electric but
subject to occupational health and safety-related guidance and supervision by
Sumitomo Electric. Employees of the SWS Group cover SWS and its aﬃliates.

Lost Time Injuries Frequency Rate＊ for
Employees in Japan by Year
（Frequency rate）

2

1.66

1.83

1.66

1.61

1.06

1.06

0.19

0.14

0.11

0.13

0.11

0

0

0.07

0.07

0

0

occurred by type, serves as an indicator to reduce accidents

2013

2014

2015

2016

2017

that can be serious. It was introduced as a new target in

All industries

disabilities and 38 or less accidents resulting in lost work
time, no lost work time accidents or accidents causing minor
target for the number of accidents, we had zero serious
accidents and accidents resulting in remaining disabilities andalso satisfied the target accident score. (An accident score,

1.58

1.5

0.94

1
0.5

0.03

0

which is calculated by weighting the accidents that have

Looking at the accidents by situation, we had fewer accidents
attributed to causes that can result in a serious accident. In

1.15

Manufacturing industry

1.02

1.20

2018 （Fiscal year）

Sumitomo Electric GroupSWS(Note) The lost time injuries frequency rate for employees in Japan in the Sumitomo ElectricGroup covers Sumitomo Electric and its 41 aﬃliates in Japan (excluding SWS and theother listed companies), and the frequency rate in SWS covers SWS.

Environmental
Preservation

Safety VISION 2022 in fiscal 2018.)

1.63

Human Resources

injury and an accident score of 216 and failed to meet theSupply Chain

were broken down into 7 injuries resulting in lost work time,Japan

Employees

Quality

Safety Performance and Future Actions

TemporarySub
worker,total
subcontractor

Social Contribution

FY
2017

Employees

SWS GroupCore
Category

FY
2018

Oﬃcer training session

Group's CSR Activities

divisions through continuous activities under the initiative ofhand, accidents by fall or by other actions of people increased. It

Governancethe group work. In-depth discussions were carried out on

parts were reduced for two consecutive years, which isBusiness Outline

lead by example, we organized an officer training session that

Basis for Management

Establishment of Safety culture

Glossary ＊ Frequency rate

Number of deaths and injuries caused by industrial accidents per million working hours. Used to express accident frequency.
The formula is: Number of deaths and injuries caused by industrial accidents / Total working hours x 1,000,000.

CSR Report 201966

CSR Core Category

CSR Priority Theme

Environmental
Preservation

Prevention of Global Warming

We will promote the establishment of a robust and reliable system throughconcerted eﬀorts of the entire group that can deal with the tightening ofenvironmental regulations, which is accelerated on a global scale
In response to growing awareness of the importance of environmental conservation insociety, we have expanded eﬀorts to conserve the environment to involve not only the
Safety & Environment Department but also the Sumitomo Electric Group as a whole.
As an initiative for the prevention of global warming, we are now analyzing thecurrent situation of the whole supply chain extending to Scope 3, which is scheduledfrom 2019 to 2020, as part of our eﬀorts to achieve VISION 2022. We will deﬁne amedium- to long-term target based on the results in 2020 and then promote more
extensive activities to reduce CO2 emissions towards 2022. In ﬁscal 2018, whileenergy consumption increased in the production sites of the Sumitomo ElectricGroup in Japan and overseas, the total CO2 emissions were reduced by 2.2%
year-on-year due to the promotion of energy saving eﬀorts and otherreasons.
As represented by the issue of microplastics, the reduction of waste isalso a major challenge. In ﬁscal 2018, we reduced the amount of waste
discharge per unit of sales by 8.7% from the previous ﬁscal year. We
will survey the status of waste discharge from each site in a thoroughand continuous manner to pursue measures for eﬀective use inindividual sites.
The reduction of environmental accidents is also recognized as animportant subject. In China, environmental regulations are being
rapidly tightened as exempliﬁed by the requirement to proper
description of waste details labeling of containers. We will
Takaya Morifurther enhance overseas environmental management to
Deputy General Manager,
prevent environmental accidents.
Safety & Environment Department

Environmental Management
Environmental Policy
The Sumitomo Electric Group has developed its environmental policy based on its business philosophy, which forms the basis for its
business management. The environmental policy, detailed below, places the highest managerial priority on activities related topreservation of the global environment.

Environmental Policy (extract)※
Basic Philosophy
The Sumitomo Electric Group thinks it is primarily important to establish a society that is sustainable and has less environmental
impact, and contributes to society by providing products and services.

Action Guidelines
1.Considering environmental preservation activity is one of the most important issues for corporative management,
the Sumitomo Electric Group promotes the activity based on its action plan.
●

Reduce environmental impacts in manufacturing activities

Prevention of global warming, saving and recycling of resources and prevention of environmental pollution●

Increase environmentally-conscious products and services

Phase out of harmful substances, and implementation of product assessment and product LCA＊

2.The Group will fulﬁll and enforce environmental management system.
●

Provision of educational programs on environmental preservation and implementation of environmental audits

3.The Sumitomo Electric Group will maintain and improve compliance action.
4.The Sumitomo Electric Group's Environmental Policy will be opened to the public upon request.

67 CSR Report 2019

Web

※ See our website for details.

https://global-sei.com/csr/environment/management.html

Glossary ＊Product Life Cycle Assessment (LCA)

Method of quantitatively assessing inputs (resources, energy etc.), outputs(substances of environmental concern etc.) and their associated impact on
the natural environment, throughout the life cycle of a product, from relatedresource intake through manufacture, distribution and use to disposal.

Basis for Management

Organizations for Promoting Environmental Management
The Corporate Environment Committee deliberates and makes decisions on the Group's environmental preservation activities
and oversees the activities on a global basis.

President
Corporate Environment Committee

Business Outline

Chairperson: Oﬃcer in charge of the environment
Members: General Managers of Business Units, Administration Division, Safety & Environment
Department, Procurement Division, Plant & Production Systems Engineering Division andLogistics Management Department, General Managers of Works

Energy Saving Task Committee

Environment Task
Committees

Resource Saving and Recycling Task Committee
Chemical Management Task Committee
GovernanceGreen Logistics Promotion Task Committee

Business Unit Environment
Committees

Business Unit Environment Committees
Chairperson: General Manager of the Business Unit
Members: Acting General Manager of the Business Unit,
environmental managers of the Business Unit (aﬃliates)

DivisionsAﬃliates locatedinside Works in Japan

Group's CSR Activities

Works Environment
Committees

DivisionsAﬃliates locatedoutside Works in Japan

Overseas aﬃliates

Core
Category

The Sumitomo Electric Group has conducted the Action ECO-21 Campaign since April 2003, focusing on E: Environmental
engineering C: environmental Communication O: Originality. Since fiscal 2018, we have conducted the Action ECO-22V Campaign
as a five-year plan.

Targets of the Action ECO-22V Campaign

Reduce 0% from FY 2017

Reduce 0%

Reduce 2.2％◎

Reduce 5% from FY 2017

Reduce 1%

Reduce 1.3％○

Reduce 5% from FY 2017

Reduce 1%

Reduce 3.3％◎

Reduce 5% from FY 2017

Reduce 1%

Reduce 0.6%△

Promotion of resource （1）Amount of waste (in Japan and overseas):
reduction of the per unit amountconservation and recycling[Amount of waste (excluding valuable materials) / sales]

Reduce 5% from FY 2017

Reduce 1%

Reduce 8.7%◎

Reduction of substances of （1）Release of chemical substances (in Japan):reduction of the absolute amount ofenvironmental concern
PRTR-designated substances

Reduce 5% from FY 2017

Reduce 1%

Reduce 25％◎

Register 100%of new products

１００％

１００％

○

62％

61％

▽

（1）CO2 emissions (in Japan and overseas):
reduction of the absolute amount（2）Energy saving (production sites): reduction ofenergy consumption per unit of sales[Consumption in crude oil equivalent / sales]（3）Energy saving (oﬃces): reduction of energy

consumption per unit of ﬂoor area
[Consumption in crude oil equivalent / ﬂoor area x the number of employees]（4）Reduction of CO2 in logistics:
reduction of CO2 per unit of sales（1）Eco Mind products（2）Eco-products（3）Products with less CO2 emissions

70% of the ratio in sales(in Japan)

Contribute to reducing CO2 emissions
by 150 thousand tons/year

130 thousand 131 thousand
tons/year

tons/year○

Legend ◎：Performance far exceeding the target (by more than about 150%); ○：Target achieved; △：Target not achieved (performance improved from the previous ﬁscal year);▽：Target not achieved (performance similar to that in the previous ﬁscal year); ▼：Target not achieved (performance deteriorating from the previous ﬁscal year)

CSR Report 2019

Environmental
Preservation

Expansion ofenvironmentallyconscious
product range

Human Resources

Evaluation

Supply Chain

FY 2018
results

Global warming
prevention /Promotionof energy saving

Targets for
FY 2022

Descriptions

Quality

Reduction of environmental impacts frombusiness activities

Period: FY 2018 ‒ 2022
Targets for
FY 2018

Item

Reduction ofenvironmental impact
from products●

Social Contribution

Action ECO-22V Campaign

68

Measures and Activities for the Environmental Risk Management Items of Sumitomo Electric
We examine measures to address risks and problems and formulate a growth strategy
Main environmental risks
Risk Factor

ImpactCountermeasures and Activities

Temperature rise
Physical risks

Sea level rise
Increase in the size and frequency of typhoons
Regulations on atmospheric emissions and wastewater discharge

ClimatechangeCarbon pricing
Regulatory risks

Energy saving (evaluation, investment and activities),
renewable energy
Implementation of detailed compliance audits
Energy saving (evaluation, investment and activities)

Reduction of emissions
Display of environmental labels

Development and marketing of eco-friendly products

Renewable energy

Cost reduction and promotion of renewable energy

Supply shortage, seasonal and interannual ﬂuctuations
Physical risks

Flood and drought

Reduction of water withdrawal,
formulation of emergency countermeasures,development of infrastructure

Deterioration of water quality
Water

Regulatory risks
Reputation risks

Restriction on water withdrawal/discharge
Soaring water prices
Opposition from the local community

Connection with the local community

Negative media coverageDiﬃculty in the disposal due to disqualiﬁcation of the disposer, etc.
Notiﬁcation of diﬃculty in the disposal from the disposer

Reduction and recycling of waste,management of the disposer through on-site checks

Chemical substances

Certiﬁcation that no prohibited substances arecontained in products

Evaluation at the development stage and management
at the purchase and manufacturing stages

Environmental accidents

Shut-down (suspension) of operation

Prevention through the evaluation of facilities

Waste

Non-compliance with law

Shut-down (suspension) of operation
Payment of ﬁne

Implementation of detailed compliance audits〈Direct risks〉Investment in equipment for responses to regulations, increases in energy cost, restriction on energy use,
shut-down (suspension) due to wind or water damage〈Indirect risks〉Increases in the costs of raw materials, energy, water, waste, etc., suspension of operation due to an accident or non-compliance with law

Education and Training

Global Environmental Audits

We provide systematic education programs on
environmental conservation

We implement audits of overseas sites, as well assites in Japan, according to the environmental laws
in the countries and regions where they are locatedTo realize environmental management, the Sumitomo ElectricGroup works to enhance every employee's environmental
awareness and knowledge. We provide all employees witheducation on the history of measures to protect the global
environment as well as the Group's environmental policy andthe Action ECO-22V Campaign.
The managerial post-based career training program involves
legal and general education on the environment. Since fiscal
2014, the program has been provided through on-site practicaltraining sessions including on-site inspection of environmental
facilities to enhance sensibility in environmental management.
We also organize training on environmental laws and technicaleducation on chemical management and other issues on aregular basis. Training for assistant plant managers was added
to the program in fiscal 2018.
Training opportunity

Title of the training

Career(managerial post-based)

Position-based training

Nominationbased

Training on the management of poisonous anddeleterious substancesTraining on the notiﬁcation of facilities subject toenvironmental laws

Optional

Professional education on environmental laws
Training on energy saving design
Training on the Japanese Chemical Substances Control Act
PRTR（Pollutant Release and Transfer Register）training
Training on the management ofchemical substances in products

On-siteTraining on Energy Saving Handbook
Action ECO-22V

69 CSR Report 2019

《 Environmental legal compliance audit 》

In addition to examinations based on ISO 14001, the Sumitomo
Electric Group implements environmental audits with focus oncompliance with environment-related laws and the efforts in the
Action ECO-21 Campaign to ensure compliance with relevantlaws and reduce environmental impact. The first round of theaudits of all manufacturing sites in Japan was started in fiscal
2008 and completed in fiscal 2011, and we have conducted
the second round since fiscal 2016.
Environmental audits of manufacturing sites outside Japan werealso launched in fiscal 2010. As of the end of fiscal 2018, we
have completed 48 of the 53 sites subject to audits: We areplanning the audits with focus on our sites in China in fiscal 2019.

《 Evaluation of Facilities That May Affect Water Quality 》
In response to a revision of Japanese Water Pollution Control Law
in 2012, we started the evaluation of facilities that use any of thehazardous substances, designated substances, oils, etc. and may
thereby affect water quality. The equipment and ancillary facilities
are inspected to assess the management status on the check
items set for each of the parts such as liquid storage and pipes.
In Japan, we completed the first round of the evaluation by
fiscal 2016 and have conducted environmental audits thatcombine legal compliance checks with evaluations on water
quality since fiscal 2016. We also started the evaluation ofoverseas sites in fiscal 2013 and conduct environmental auditsthat combine legal compliance checks with evaluations onwater quality as we do in Japan.

《 Check of the Progress in the
Activities of the Action ECO-22V Campaign 》

and its Group companies to the Safety & Environment

We have set check items for environmental audits and evaluate

An affiliate in Taiwan received an order to pay a fine from thethe activities and progress.

authority for non-compliance in April 2018, and so did an

Basis for Management

Department of Sumitomo Electric.

affiliate in China in May 2018 and April 2019.

《 Conﬁrmation of Legal Compliance 》

We will continue to strive for a proper understanding of the

In fiscal 2018, five violations of laws and regulations (cases

regulations in the respective regions to ensure thoroughwhere guidance, recommendation or order to pay fine wascompliance.

issued by the authority) were reported by Sumitomo ElectricBusiness Outline

Environmental Accounting
Financial items
Investment

Expense(million yen)

Non-ﬁnancial items
Economic eﬀect(million yen)

Change factors in FY 2018
(in Japan)(million yen)2016 2017 2018 2016 2017 2018 2016 2017 2018
Reduction ofenergy cost

(Note 1)

(Note 1)

Reduction ofgreenhouse gas（GHG) emissions(Note 4)GHG emissions(thousand tons-CO2e/year)
900
750

727

49

0

▲68

600

708

450

882

723

268

300
150
0

2017 Change due Change due Actual
to boundaries
changeInvestment inresource saving
and recycling

Waste
disposal cost

(Note 2)

Sale ofvaluables materials(Note 3)(Note 3)

39.3

0

69

43

20
10

2017 Change due Change due Actual
to boundaries
change975

to saleschangechange2018 (Fiscal

year)

ISO 14001 is the core of
our environmental
management activities, andthe certiﬁcation isrequested by customers.
We consider cleanup of theneighboring areas as a basicsocial activity, and will continue
our commitment tocommunication with local
communities through thisinitiative.

We continuously restore
the contaminated soil andgroundwater identiﬁed in
our facilities.

Cost ofsocialactivities

10

9

8

Cleanup of areas outside company
sites, external environmental
education, etc.

Cost ofenvironmental
remediation

52

8

11

Restoration of contaminated soil
and groundwater

Environmental
Preservation

CSR Report 2019

Human Resources

Boundaries of tabulation: Sumitomo Electric + aﬃliates in Japan(Note 1) Only the amount of investment in the activities mainly aimed at energy saving among the activities certiﬁed as energy saving activities by the Energy Saving Oﬃce of the Safety &Environment Department is subject to the calculation (the activities mainly for the purposes other than energy saving, such as renewal of aging facilities and peak cut, are notcovered). The economic eﬀect includes that of the energy saving activities in which no investment has been made.
(Note 2) The amount of investment does not include investment related to eﬃcient use of resources but covers investment for reduction of waste generation and recycling.
(Note 3) The cost is calculated based on payment to the waste disposal contractor. Metals are not included in the calculation of either cost or economic eﬀect.
(Note 4) Change due to boundaries change: Emissions or amount of waste in ﬁscal 2017 from the boundaries of collection newly added or excluded in ﬁscal 2018 (no boundaries were
newly added or excluded in this ﬁscal year).
Change due to sales change: [Emissions or amount of waste in ﬁscal 2017 from the boundaries of collection for ﬁscal 2018] x (Sales in ﬁscal 2018 / Sales in ﬁscal 2017 - 1)
Actual change: Calculated by subtraction

Supply Chain

934

Cost of environmental organization,
ISO 14001 registration andmaintenance, etc.

Quality

1,049

37.2
▲4.8

Social Contribution

1,175 1,294 1,240 127

0Cost ofmanagement
activities

2.7

We have set the target of
reducing the amount of waste
per unit of sales by 1% fromthe ﬁscal 2017 level and takevarious resource-saving
measures. To reduce theamount of waste, we arepromoting the conversion ofwaste into valuable materials.
While the amount of waste
has increased due to thesuspension of imports ofrecyclable waste by China, wewill continue the activities tosell valuable materials
produced from waste throughthe concentration of waste
liquid, etc. as a method to
reduce the amount.

Core
Category0

year)(Note 4)30

182018 (Fiscal(excluding valuable materials)(thousand tons/year)40

61changeAmount of waste
50

Waste
reduction

to saleschangeWe set no increase in CO 2
emissions from the FY2017
level as a KPI for ﬁscal 2022.
To achieve it, we have deﬁned
the target of reducing energy
consumption per unit of sales
by 1% from the ﬁscal 2017
level and make various energy
saving eﬀorts. These activities
are also important for the
reduction of energy cost.
The knowledge learned
through the activities is also
introduced into overseas
Group companies.

Group's CSR Activities

1,034 2,630 2,857

Governance

Investment inenergy saving

Strategy/
opportunity and risk

70

Activities to Prevent Global Warming
Reduction of Greenhouse Gas Emissions

Factor Analysis of Changes in Greenhouse Gas Emissions (in Japan and overseas)
Emissions converted to CO2 equivalent(thousand tons-CO2e/year)

Our greenhouse gas (GHG) emissions decreased fromthe base year both in Japan and overseas

1,600

The Sumitomo Electric Group sets the target for fiscal 2022

1,400

of achieving no increase in GHG emissions from the fiscal
2017 level as an initiative to prevent global warming.
We have conventionally positioned the promotion of energy
saving as a core target in our environmental activities andpromoted it actively in our sites and divisions.
With the Energy Saving Office serving as the organizer, wehave appointed a new task committee member from eachdivision to encourage the divisions to promote energy saving
activities in a more organized and autonomous manner. With
these efforts, improvement of energy efficiency in ouroverseas companies is in progress while we are shifting our
production facilities to overseas sites.
With these activities and partly due to a decrease in CO 2

0

2017

in Japan and overseas despite an increase in the production

600

volume in the Group as a whole. The emissions in the whole

500

1,600
1,400

1,456

1,442

1,200

681

1,000
800

1,430

711

700

1,497

1,541

848

732

761

200

744

730

764

727

In Japan2014
Result2015
ResultOverseas

2016
Result

2017
Base

708
2018
Result0(Fiscal year)

GHG emissions are calculated based on the Greenhouse Gas Emissions Accounting and Reporting
Manual Ver. 4.3.2 (2018) by the Japanese Ministry of the Environment and Ministry of Economy,
Trade and Industry (except the emission factors, which are mentioned below).
Basic policy on the emission factors: The latest available emission factors at the time of the calculation
are used for purchased electricity while ﬁxed emission factors areused for other than purchased electricity.
CO2 emission factor for purchased electricity:[In Japan] Adjusted emission factor of each electricity power supplier published in the "Disclosureof basic emission factor, adjusted emission factor, etc. of each electricity power supplierfor ﬁscal 2017" (2018) by the Japanese Ministry of the Environment[Overseas] Emission factor in each country for 2016 mentioned in "CO 2 Emissions from Fuel
Combustion 2018" (2018) by IEA
CO2 emission factor for other than purchased electricity (excluding GHG emissions from non-energy sources):[Both in Japan and overseas] Emission factor in "Guidelines for accounting of greenhouse gas emissions
from industrial commercial sectors" (2003) by the Japanese Ministry of
the Environment
CO2 conversion factor for GHG emissions from non-energy sources:[Both in Japan and overseas] Global warming potential in "Greenhouse Gas Emissions Accounting andReporting Manual Ver. 4.3.2" (2018) by the Japanese Ministry of theEnvironment and the Ministry of Economy, Trade and Industry

GHG emissions are calculated based on the Greenhouse Gas Emissions Accounting and Reporting
Manual Ver. 3.5 (2014) by the Japanese Ministry of the Environment and Ministry of Economy, Tradeand Industry (except the emission factors, which are mentioned below).
Basic policy on the emission factors: ﬁxed emission factors are applied

Europe, etc.

2013267 285 285

295

104 107 99 96

2014

China

Asia (except China)

Japan

2015

2016

2018

2017

139 140

America

Reduction of Energy Consumption
In fiscal 2018, we reduced energy consumption per unit ofsales by 1.3% from the fiscal 2017 level. This improvement
was attributed to the steady efforts of our divisions to raiseenergy efficiency. In the future, we will continue theevaluation of energy consumption per unit of production ineach division for further improvement, and strive to meet thetarget for the whole Group through the achievement of thetarget in each division.
Energy Consumption and Energy Consumption per Unit of Sales(in Japan and overseas)[In Japan] Actual emission factor of each electricity power supplier published in the "Disclosure ofactual emission factor, adjusted emission factor, etc. of each electricity power supplierfor ﬁscal 2012 " (2013) by the Japanese Ministry of the Environment[Overseas] Emission factor in each country for 2011 mentioned in "CO 2 Emissions from Fuel
Combustion Highlights 2013" (2013) by IEA
CO2 emission factor for other than purchased electricity:[Both in Japan and overseas] Emission factor in "Guidelines for accounting of greenhouse gas emissions
from industrial commercial sectors" (2003) by the Japanese Ministry of
the Environment(Note 3) The ﬁgures in ﬁscal 2017, which was the base year for the target, and thereafter were calculated withseven companies including SEEV＊ and SSWT＊ newly added for data collection. As a result of thechange in the boundaries of data collection, overseas GHG emissions in ﬁscal 2017 increased by 157
thousand tons-CO2e.
(Note 4) The CO2 emission factor for purchased electricity in Japan was changed from basic emission factor toadjusted emission factor for the calculation of ﬁgures in ﬁscal 2017 and thereafter. The impact of thischange on the calculation of GHG emissions is only minor.

＊SSWT

Energy consumption per unit of sales(kl/100 million yen)

Energy consumption(TJ/year)32
30,00025,000CO2 emission factor for purchased electricity:

71 CSR Report 2019

220 21047 52 57 65 60 56(Note 2) The results for the period from ﬁscal 2013 to 2016 were calculated as mentioned below.

SEI Electronic Components (Vietnam), Ltd.

727 708

Production efficiency has been improved

Reduction ratio(Note 1) The results in ﬁscal 2017 and thereafter were calculated as mentioned below.

Glossary ＊SEEV

764(Note 2) The CO 2 emission factor for purchased electricity in Japan was changed from basic
emission factor to adjusted emission factor for the calculation of ﬁgures in ﬁscal 2017 andthereafter. The impact of this change on the calculation of GHG emissions is only minor.

0

2013
Result100

730(Note 1) The ﬁgures in ﬁscal 2017, which was the base year for the target, and thereafter were
calculated with seven companies including SEEV and SSWT newly added for data collection. As
a result of the change in the boundaries of data collection, GHG emissions in Asia and America
in ﬁscal 2017 increased by 105 thousand tons-CO2e and 52 thousand tons-CO2e, respectively.

833

600
400

263 268 258 276

200
0
1
2
3

(Fiscal year)

429 428

300

2.2
1,575

761 744

400

Reduction ratio (%)

2018

Actualchange(thousand tons-CO2e/year)

700

0Change due tosales change

Greenhouse Gas Emissions from the Global Operations of
the Sumitomo Electric Group by Region

emissions decreased from the previous fiscal year level both

Emissions converted to CO2 equivalent(thousand tons-CO2e/year)

Change due toboundaries change(Note 1) Change due to boundaries change: Emissions in ﬁscal 2017 from the boundaries ofcollection newly added or excluded in ﬁscal 2018.
Change due to sales change: [Emissions in ﬁscal 2017 from the boundaries of collection
for ﬁscal 2018] x (Sales in ﬁscal 2018 / Sales in ﬁscal 2017 - 1)
Actual change: Calculated by subtraction(Note 2) The ﬁgures in ﬁscal 2017, which was the base year for the target, and thereafter were
calculated with seven companies including SEEV and SSWT newly added for datacollection. As a result of the change in the boundaries of data collection, overseas GHG
emissions in ﬁscal 2017 increased by 157 thousand tons-CO2e.
(Note 3) The CO 2 emission factor for purchased electricity in Japan was changed from basic
emission factor to adjusted emission factor for the calculation of ﬁgures in ﬁscal 2017 andthereafter. The impact of this change on the calculation of GHG emissions is only minor.

800

Greenhouse Gas Emissions and Reduction Ratio(in Japan and overseas)

1,541
▲77

1,200

emission factor for electricity, in fiscal 2018 our GHG

Group declined by 2.2% from the fiscal 2017 level.

43

0

1,575

40

29

28

30

31

30

23,829 23,958 23,707 24,390 27,786 28,177

35
30
25

20,00015,00010,000
5,000
0

2013
Result2014
Result2015
ResultIn Japan and overseas operations

2016
Result

2017
Base

2018
Result(Fiscal year)

Energy consumption per unit of sales(Note 1) Energy consumption per unit of sales: Crude oil equivalent of energy consumption divided by sales(Note 2) The ﬁgures in ﬁscal 2017, which was the base year for the target, and thereafter were calculated withseven companies including SEEV and SSWT newly added for data collection. As a result of the change
in the boundaries of data collection, energy consumption in ﬁscal 2017 increased by 3,146 TJ.

Sumiden Steel Wire (Thailand) Co., Ltd.

Number of Subjects in the Submitted Ideas andCost Reduction Eﬀect by Fiscal Year

We provide data to CDP＊

(million yen/year)

In ﬁscal 2014, we increased the number of the categories for

Scope 3 of CDP to publish our emission data, and we started
to receive independent assurance on Category 4: Upstream

1,400

400

600

Scope 2

1,332

Scope 3

8,272

Capital goods

538

3

Fuel- and energy-related activities notincluded in Scope 1 or Scope 2

262

4

Upstream transportation and distribution

38

5

Waste generated in operations

30

6

Business travel

35

7

Employee commuting

78

8

Upstream Leased Assets−

9

Downstream Transportation and Distribution−

10

Processing of Sold Products−

11

Use of Sold Products

12End-of-Life Treatment of Sold Products−

13

Downstream Leased Assets−

14

Franchises−

15

Investments−

0Energy Saving Activities in Production Units《 Energy Efficiency Improvement Measures to Reduce Energy Use 》

539

2013

2014

2015

2016

2017

2018

(Fiscal year)

Number of Subjects in the Submitted Ideas《 Specific Measures 》

To promote energy saving activities of Group companies anddivisions, we have taken such measures as energy saving
evaluation, measurement-based evaluation, adoption of relevant
technologies and development and evaluation of newtechnologies, and proposed new ideas. From ﬁscal 2016, inaddition to the proposal of ideas, we promote cooperation inpriority areas, in which we actually implement improvement
activities in cooperation with divisions, and continuously enhanceother initiatives by conducting the PDCA cycle to ensure theimprovement of the effectiveness. The speciﬁc measures aredescribed below.
●●●

Measurement-based evaluation :We use ultrasonic wave or infrared based instruments todetermine the volume of steam and compressor air leaks. In
addition to judgment on whether there is a leak or not, expected
cost reduction effects are shown in a quantitative manner tofacilitate improvements. We started to promote IoT-based
diagnosis in fiscal 2018 for the monitoring of data in remotesites, which has been effective for the elimination of wasteful
power consumption and the prompt detection of problems inequipment.
Development and evaluation of new technologies：
Among the latest energy-saving technologies that have not been
introduced in our group, we identify those that are likely to beeffective and evaluate their performance. We initiated measuresthat focus on the recovery of waste heat to make effective use ofunused heat in fiscal 2018. The new technologies evaluated as
being effective will be adopted on a group-wide scale in the
future.
Cooperation in priority areas :Divisions and the Manufacturing Management & Engineering
Unit closely cooperate for improvement of overall efficiency
while giving priority to the divisions with a relatively large sharein energy consumption. In addition to tangible aspects such as
equipment, intangible aspects such as production engineering
are also considered in the improvement activities.

Energy Saving Activities in Offices
We are working to make employees always aware of energy saving

reducing energy consumption per unit of sales by 1% per

We have assigned a member and a vice member of the
Workplace ECO Activity Promotion Committee in each
workplace in the head offices, district offices and branch
offices. The committee members perform and promote thefollowing activities:

annum from the ﬁscal 2017 level in the Action ECO-22V
Campaign. Meanwhile, Group companies and divisions set thetarget of reducing energy consumption per unit of production
by 1% per annum from the ﬁscal 2017 level and strive to meetit through the discovery of subjects for energy saving andpromotion of activities in a planned manner. In ﬁscal 2018,
while the target was a reduction of 1% from the ﬁscal 2017by 2.2%.

② Turning off all office lights during lunch break③ Turning off lights and air conditioners in meeting rooms andtoilets when not in use

The number of subjects in the submitted ideas and cost

④ Introducing economy mode for PCs and power-saving
OA devices on a preferential basis

reduction eﬀect are presented below.

⑤ Using zone lighting during overtime hours

Environmental
Preservationlevel, we reduced energy consumption per unit of production① Dressing cool in summer and warm in winter,to keep air conditioning moderate

Human Resources

We work to meet the group-wide energy saving target ofSupply Chain

We are working to reduce wasteful use and improve efficiency
with the effects of ideas for energy efficiency improvement

0

Quality(Note 4) Basic Guidelines on Accounting for Greenhouse Ｇas Emissions Throughout the Supply Chain,Ver. 2.2 of the Japanese Ministry of the Environment were referred to for the calculation.

200

871

Cost Reduction Eﬀect(Note 1) (-) indicates that the calculation method is under consideration or the category is not applicable.

(Note 3) The data for Category 4 in the table above cover logistics data in Japan only.

400

200

4,848

(Note 2) Scope 1: Direct emissions from the use of fossil fuels, etc. in our facilities(including SF6 and other greenhouse gases)
Scope 2: Indirect emissions from the use of electricity and steam supplied from outside our facilities
Scope 3: Total emissions not only from the reporting organization but also from all sources
related to its business activities

600

Social Contribution

2

2,442

800

Core
Category

Purchased goods and services

1,200

367

Group's CSR Activities

1

1,193

(subject/year)

705

Governance

Description

716

556

Business Outline

Greenhouse Gas Emissions in FY2018 (thousand tons-CO2e/year)

209

1,237

1,000

transportation and distribution.

Scope １

464

712

670

1,200
800

Category

Basis for Management

Emission data for Scope 3

Glossary ＊CDP (former name: Carbon Disclosure Project)

In CDP, an international NPO, institutional investors collaborate to implement a project that requests
companies to establish strategies against climate change and publish data on GHG emissions.

CSR Report 201972

Reduction of CO2 Emissions in Logistics

ExportChanges in per-unit CO2 emissions from transportation in Japan

International
air
37,971t- CO2(tons-CO2/million ton-km)(tons-CO2/100 million yen)

105.0
100.0

101.2
97.9

95.0

3.52

90.0

96.2
3.47

95.3

3.50
3.00

2.76

0

2014

2015

4.00

97.2

3.35

85.0

2016

4.50

2017

2.50

2.55
2018

0
(Fiscal year)

Sumitomo Electric Group (Sumitomo Electric + 32 manufacturing companies
in Japan (excluding Sumitomo Wiring Systems, Ltd.))
Sumitomo Wiring Systems, Ltd.
(Note 1) Sumitomo Electric and its 32 manufacturing companies in Japan (excluding
Sumitomo Wiring Systems, Ltd.)(Note 2) Per unit CO2 emissions in the Sumitomo Electric Group compared withthe previous ﬁscal year
Sumitomo Wiring Systems, Ltd. adopts CO2 emissions per sales amount as thebasis for the calculation while other Group companies use CO 2 emissions per
cargo transport (t-km). Therefore, the weighted average of each year-on-year
CO2 emission reduction rate is calculated based on the CO2 emissions.

Changes in CO2 emissions from transportation
CO 2 emissions from transportation in Japan increased byapproximately 5.1% in Sumitomo Electric and decreased byapproximately 2.8% in Sumitomo Wiring Systems, Ltd. from thefiscal 2017 level. The emissions in the Sumitomo Electric Group
as a whole increased by approximately 2.0% to 37,577 tons.
CO2 emissions from exports from Japan declined byapproximately 9% in Sumitomo Electric due to a decrease in theuse of international flights to Europe and North America andmarine transportation to North America while the emissions
increased by approximately 6% in Sumitomo Wiring Systems, Ltd.
with an increase in the use of international flights. The emissions
in the Sumitomo Electric Group as a whole decreased byapproximately 0.6% from the fiscal 2017 level to 95,993 tons.
We will continue to work on group-wide efforts to reduce CO2
emissions.

Glossary ＊Eco Rail Mark73 CSR Report 201936,839t- CO2
Truck etc.
33,876t- CO2

96,600Railroad
817t- CO2
Vessel in Japan
2,146t- CO2

t-CO2

Transportation in Japan

Export58,416t- CO2
International
air
36,874t- CO2

FY ２０１8
Annual CO2
emissions

95,993t-CO2

Ocean vessel
21,542t- CO2

37,577t- CO2
Truck etc.
34,746t- CO2

Railroad
667t- CO2
Vessel in Japan
2,164t- CO2(Note) Boundaries of data collection: Sumitomo Electric + 32 manufacturing companies in Japan +Sumitomo Wiring Systems, Ltd.
CO2 emissions in Japan are calculated on an improved ton-kilometer basis and a fuel-eﬃciency basis.
CO2 emissions from export activities are calculated using the conventional ton-kilometer method.
Based on the simple calculation tool for logistics CO2 emissions by Policy Research Institute for Land,
Infrastructure, Transport and Tourism (PRILIT)

Improvement of efficiency in the transportationof overhead transmission cable from Ibaraki Pref.
to Yamaguchi and Saga Pref.
We reviewed the route and means of the transportation of thealuminum overhead transmission lines delivered from thealuminum wire plant in Hitachi, Ibaraki Prefecture to theinstallation sites in Yamaguchi and Saga Prefectures to improvethe efficiency. We originally planned to take two separate
routes for the delivery as the customers are different.
To deliver the products according to the respective schedulesof the installation works, we originally planned the constructionof a warehouse for temporary storage in both Hiroshima andFukuoka Pref. We also considered coastal transportation fromthe plant to the warehouse for delivery to Saga and landtransportation by 15-ton trucks for delivery to Yamaguchi.
However, it was difficult to prepare more than 90 trucks in total
and inefficient to set up warehouses in two locations.
Accordingly, we decided to construct a warehouse on a site in
Kitakyushu City after coordination with both customers throughthe respective sales staff in charge to improve the operation.
We also shifted all of the transportation from the plant to thewarehouse to coastal transportation in order to reduce truck
transportation. In addition, the establishment of the warehousein Kitakyushu reduced the distance for the delivery to thedestinations in Yamaguchi.
Through these improvement measures, we reduced CO 2
emissions from theInitial plantransportation, which
Saga 1delivered 432 cables
Relay point A(in Fukuoka City)
Saga 2of approximately 1,430
Hitachinaka Port ➡ Oita Port
tons in total over 10
Yamaguchi 1
months from June
Yamaguchi 2
Relay point Ｂ
2018 to March 2019,(in Hiroshima City)
Yamaguchi 3
by approximately 51
Yamaguchi 4
tons.
Ibaraki Pref.

Per Unit CO2 emissions by Year

Ocean vessel
21,790t- CO2

Transportation in JapanFY ２０１7
Annual CO2
emissions

After improvement
Ibaraki Pref.

Per-unit CO2 emissions from transportation in Japan were reduced
by approximately 7.8% from the fiscal 2017 level in Sumitomo
Wiring Systems, Ltd. but increased by approximately 4.1% in
Sumitomo Electric (Note 1). The emissions in the Sumitomo ElectricGroup as a whole decreased by approximately 0.6% (Note 2).
Sumitomo Wiring Systems, Ltd. raised the loading ratio of trucks to
reduce the number of long-distance regular transport services andalso reviewed the transportation network to shorten thetransportation distance, which led to the improvement of about 8%.
In Sumitomo Electric, with the aim of reducing emissions from thedelivery of high-strength steel wires from Itami Works, thenumber of transport services to Fukushima Prefecture was
reduced and the port of shipment for exports to Thailand andother destinations was changed to shorten transportation
distance in Japan. Other efforts to reduce emissions included theimprovement of efficiency in the transportation of overheadtransmission cable from Ibaraki Pref. to Saga and Yamaguchi Pref.
Nevertheless, the emissions increased by approximately 4.1%
year-on-year for reasons including the use of truck and coastaltransportation mainly to Hiroshima Pref. and Kyushu Area for thedelivery of products including copper wire rods from Osaka
Works, high-strength steel wires from Itami Works and electric
wires to be used in indoor wiring from Hiroshima Plant instead ofrailway transportation, which was unavailable due to long-time
disconnection in some sections of JR Sanyo Line as a result of theheavy rain in western Japan, as well as a decrease in the use ofrailway and coastal transportation due to a decline in the ordersof copper wire rods.

59,761t- CO2

Saga １
Saga 2

Relay point C(in Kitakyushu City)

Yamaguchi １
Yamaguchi 2
Yamaguchi 3

Hitachinaka Port ➡ Oita Port

Yamaguchi 4

Sumitomo Electric has acquired certification as acompany engaged in the initiatives of Eco Rail Mark＊
from the Railway Freight Association.

A certiﬁcation mark awarded by the Ministry of Land, Infrastructure, Transport and Tourism, Government of Japan. The use of the mark is allowed only for
products or companies that use rail transportation, which generates relatively less CO2 emissions and is therefore environmentally friendly, in accordancewith designated criteria. The mark included in packages and advertisements of products serves as a judgment standard for customers' purchase decisions.

Promotion of Resource Conservation and Recycling
Amount of Waste by Type in FY 2018 (in Japan)
Waste landﬁlled or incinerated without heat recovery Total : 617 tons/year

We aim to manage waste in a proper manner

Waste plastics
Waste paper

26

SludgeOthers823

Waste glass andceramics《 Promotion of Zero Emissions 》

Amount of industrial waste+ Amount of general waste+ Amount of valuable materials

15

Heat recovery

7,852 tons/year

Material recycling

29,352 tons/year

×100

Amount of
waste

81,385

Valuable materials

43,564 tons/year

tons/year

GovernanceAmount of waste incinerated without heat recovery+ Amount of landﬁll waste

545

Business Outline

To help solve social problems such as shortage of landfill sites
and illegal waste dumping and to make effective use ofresources, it is necessary to avoid landfilling of industrial waste
without serious efforts and recycle waste to the extent possible.
The Sumitomo Electric Group works to reduce the zero emission
rate.
The rate increased year-on-year in fiscal 2018 due to the issue of
waste plastic in China.

Zero emission=
rate (%)

Basis for Management

Efforts to Achieve Zero Emissions andReduce the Amount of Waste (in Japan)(Note) From the Action ECO-21 (Phase Ⅵ) Campaign launched in ﬁscal 2015, all valuable materials,
part of which were not included in the denominator until ﬁscal 2014 (the materials thatwere already treated as valuables in ﬁscal 2000), are included in the denominator.

Amount of recycled waste Total : 72,916 tons/year

Amount of Waste and Zero Emission Rate (in Japan)

100
80
60
40
20
0

Waste metal

Zero emission rate (%)

0.76

0.04

0.03

79.3

81.4

48.4

48.8

30.9
0.0

32.5
0.0

73.3
43.3
30.0
0.1

2014

Valuable materials
Zero emission rate

2015

0.03

88.5

81.6

0.4
0

48.9

43.6

37.3

39.3

37.2

0.0

Recycled waste

Waste alkali

Waste plastics

81.4

44.2

2016

Waste acid

0.8

0.22

0.2

0.6

2017

2018

Waste oil
Waste paper

Wood waste

Waste glass andceramics

Others(Fiscal year)

Incineration and landﬁll wastes《 Reduction of the Amount of Waste 》

Reduction of the Waste to Be Incinerated
Without Heat Recovery or Landfilled (Overseas)
Waste management outside of Japan
While the situation of landfill sites overseas is different from thatin Japan, we work to refrain from landfilling industrial waste
without efforts and recycle and convert waste into valuable
materials to the extent possible through separation of waste andother efforts to maintain proper waste management.
We also operate in countries where the environment for recycling
has not been developed, and will be continuously committed to
the reduction of the zero emission rate on a global scale.

Amount of Waste and Zero Emission Rate (Overseas)

8.7

100
60
20

35.1

37.4

39.8

40.7

30.9

32.5

30.1

37.3

2013

In Japan

2014

Overseas

2015

2016

57.6

53.3

39.5

37.8

2017

2018

(Fiscal year)

Reduction rate per unit of sales(Note) Amount of waste per unit of sales: Amount of waste (excluding valuable
materials) divided by consolidated sales

8.7

100
80

20

93.4

81.8

86.2

41.1

44.4

46.4

52.6

26.2

29.1

32.3

32.4

76.2

8.9

0

2013

8.3
2014

Valuable materials
Zero emission rate

7.5
2015

108.1

109.4

50.4

56.1

43.8

Recycled waste

2017

10
0

43.0
13.8

8.3
2016

20

9.4

10.3
2018 (Fiscal year)

Incineration and landﬁll wastes(Note) ・ The ﬁgures in ﬁscal 2017, which was the base year for the target, and thereafter were
calculated with four companies including SEEV and SSWT newly added for datacollection. As a result, the amounts of valuable materials, recycled waste and incinerationand landﬁlled wastes in ﬁscal 2017 increased by approximately 2.1 thousand tons, 9.9thousand tons and 2.9 thousand tons, respectively.
・ The results in ﬁscal 2017 have also been corrected for the improvement of accuracy.
・ The data for waste indicators in three companies including KPMC＊ are not included in thecollection of data on the environmental performance indicators because they are stillworking to establish a system.

Environmental
Preservation

0

5

10

80
40

0

12.8

8.9

Human Resources

Reduction rate (%)

10.1

120

40

0

Amount of waste(excluding valuable materials)(thousand tons/year)

Zero emission rate (%)

11.7

Supply Chain

Amount of waste(thousand tons/year)

60

Amount of Waste (excluding valuable materials) andReduction Rate per Unit of Sales (in Japan and Overseas)

1,149

Quality

The Sumitomo Electric Group is also committed to reducing theamount of industrial waste generated in its facilities by improving
production efficiency.
To reduce the amount of waste, we promote conversion of thewaste into valuable materials through separation and search ofuses, and also focus on reduction of defects and review of theprocess that caused defects in production sites, which are
fundamental activities for manufacturing, as well as in-house reuseof the waste generated and reduction of waste volume.
In fiscal 2018, we reduced the amount of waste per unit of sales
by 8.7% through our efforts for the Action ECO-22V Campaign
despite changes in the treatment mode as a result of therestriction on the imports of waste plastic in China, which
occurred in fiscal 2017, as well as troubles in the waste liquid
treatment equipment.
We will continue to make efforts with focus on recycling of plastic
through the thorough separation of waste plastic and the reductionof unneeded materials generated through waste liquid treatment.

410

Social Contribution(Note) The results in ﬁscal 2017 have been corrected retrospectively for the
improvement of accuracy.

36,781

8,175
6,728
6,284
5,806
3,722
3,087
774

Core
Category

2013

0.10

SludgeGroup's CSR Activities

Amount of waste(thousand tons/year)

Glossary ＊KPMCKeystone Powder Metal Company

CSR Report 201974

Reduction of the Release of Harmful Chemical Substances
Chemical Substance Management System
We have established an original system to unify
the management of chemical substances
The Sumitomo Electric Group established a chemical
management system, and started the management of poisonousand deleterious substances and PRTR-designated substances in
Sumitomo Electric's three Works in Osaka, Itami and Yokohama,and our affiliates in the Works in fiscal 2011. The system is also
used to collect data for reporting under the PRTR Law＊.
In fiscal 2012, domestic affiliates outside the three Works also
launched the operation of this system in sequence, which enabled
the search of the companies using poisonous and deleterious
substances and safety data sheets (SDS) concerning all poisonousand deleterious substances used in affiliates in Japan.
We will continue our efforts to enhance the management ofchemical substances used in the Group.

Release and Transfer of Chemical
Substances Specified in the PRTR Law
The whole Group, including overseas affiliates,
is submitting reports in accordance with the applicable laws
Sumitomo Electric and its affiliates in Japan, using the chemical
substance management system developed by the Company,
measure the amount of PRTR substances treated per month,and calculate the amount of these substances released andtransferred in order to report annually in accordance with thelaw. A total of 42 sites of Sumitomo Electric's Osaka andYokohama Works and 25 Group companies submitted suchreports for ﬁscal 2018. Sumitomo Electric Group's total releaseand transfer of PRTR-designated substances in Japan were 39
tons and 123 tons, respectively.

119

100

66

50

the release of chemical substances specified in the PRTR Law
by 5% as an initiative of the Action ECO-22V Campaign fromfiscal 2018 to fiscal 2022. In fiscal 2018, we made efforts tomeet the target of reducing the amount by 1% from the fiscal
2017 level. We worked to cut the atmospheric release in thesites that release 1 ton or more to the air in a year to reduce
the annual release by 25.0% from the fiscal 2017 level to38.8 tons in fiscal 2018, which met the above-mentioned
target.

Soil and Groundwater Remediation
We disclosed the pollution status of three major Works (Osaka,
Itami and Yokohama) in August 2001. At those three Works andother domestic sites where pollution has been identified
through our surveys conducted thus far, we are continuing soil
and groundwater remediation by soil replacement, groundwater
pumping and soil gas absorption. We also conduct groundwater
monitoring on a regular basis, and have confirmed that thepollution has not spread outside the sites.

Measures against Dioxins and Asbestos
The aluminum alloy manufacturing facility and its exhaust gas
purification facility at Sumitomo Electric Toyama Co., Ltd. aresubject to the Law Concerning Special Measures against

At present, the Sumitomo Electric Group produces noproducts using asbestos.

140

131

We will be committed to reducing the absolute amount ofremain within regulated standards.

Release and Transfer (tons)

200

143

We are committed to reducing the release ofchemical substances specified in the PRTR Law

Dioxins. We have ensured that emissions from these facilities

Release and Transfer of Chemical Substances
Speciﬁed in the PRTR Law by Year

150

Reduction of the Release of Chemical
Substances Specified in the PRTR Law

133

59

53

51

52

2014

2015

2016

2017

123
39

0

2013

Release2018 (Fiscal year)

Transfer

・The amounts are calculated in accordance with PRTR Release Estimation Methods
Manual, version 4.1 (2011) by the Ministry of the Environment and the Ministry of
Economy Trade and Industry of Japan.

Release and Transfer of Chemical Substances Speciﬁed in the PRTR Law
Chemical substancePhenolInto soil

Into landﬁll

Total release

By sewage

By disposal

Total transfer

Total
amount

4.9

0.0

0.0

0.0

4.9

0.0

13.8

13.8

18.7

0.0

0.2

0.0

0.0

0.2

0.0

15.3

15.3

15.5

4.3

Toluene11.0

ethanolamine

0.0

Cresol

3.0

Lead

0.0

FormaldehydeBis(2-ethylhexyl) phthalate
1-bromopropane

37 other substances
Total

Transfer

Into water

1,2-dichlorobenzene
Nickel compounds

ReleaseInto air

0.0
0.0
5.2
9.1

37.5

0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
1.1
1.3

0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

4.3

0.0
0.0

11.0

0.0

0.0

3.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

5.2

0.0

10.2

0.0

0.0

38.8

0.0
0.0
0.0
0.4
0.0
0.0
0.0
0.0
0.2
0.6

14.0
4.3
8.9
8.3
8.4
6.5
6.5
0.4

36.0

122.4

14.0
4.3
8.9
8.7
8.4
6.5
6.5
0.4

36.2

123.0

18.3
15.3
11.9
8.7
8.4
6.5
6.5
5.6

46.4

161.8
(Unit: tons)

Chemical substanceDioxins

ReleaseInto water

Into soil

Into landﬁll

Total release

By sewage

By disposal

Total transfer

1

0

0

0

1

0

2

2

(Note) Boundary of data collection: Sumitomo Electric + PRTR obligatory companies among its aﬃliates in Japan

Glossary ＊ PRTR Law

75 CSR Report 2019

Transfer

Into airTotalamount3(Unit: mg-TEQ)

Act on Conﬁrmation, etc. of Release Amounts of Speciﬁc Chemical Substances inthe Environment and Promotion of Improvements to the Management Thereof.

Expansion of Environmentally Conscious Products
We are actively promoting assessment anddevelopment of environmentally conscious products
Along with the reduction of environmental impact from ourbusiness activities, Sumitomo Electric is striving to increase

environmentally conscious products as an initiative stated its
environmental policy.

and environmental contribution and classified into, forexample, Eco Mind products, Eco-products and anti-global
warming products based on the levels. The assessment
results are also used for development of new products.

《 Eco Mind Products 》

We perform environmental assessment of products when
design changes to existing products. The products having《 Anti-Global Warming Products 》

In this system, we register the Eco products that especiallycontribute to the reduction of CO2 emissions in the
production stage or when they are used by customers, andcalculate the reduction effect.
The products contributed to the reduction of CO2 emissions
by a total of 131 thousand tons in fiscal 2018.
Percentage of Eco-Products in Sales and Contribution to
the Reduction of CO2 Emissions
Percentage of Eco-products in sales (%)

70
60
50
40

undergone product assessment are registered as Eco Mind30

By the end of fiscal 2018, a total of 1,184 items have been

10

products in the Sumitomo Electric Group.

20

registered as Eco Mind products.

0

44

41

53

59
114

61
126

61

Contribution toemission reduction(thousand tonsCO2/year)

140

131

120
100

78

80

63

59

60

《 Eco-Products (Eco Symbol Program) 》

40

Among Eco Mind products, the products with particularly

ISO14021, and those that meet the criteria are certified as
Eco-products. Through this system, we aim to promote

development of environmentally conscious products andstrive to penetrate the market with them.

2014

2015

2016

2017

2018

(Fiscal year)

・ Calculation method
The percentage of Eco-products in sales is calculated as the value of the shipments* ofthe products certiﬁed Eco-products divided by the total value of shipments*.
(* Shipments are those from manufacturing departments in Japan. However, they exclude
shipments from electronic conductor departments, which mainly work to supply
intermediate goods within the Group.)

Redox ﬂow batteries of Sumitomo Electric keep evolving.
We will further promote the dissemination of
the batteries in the world to reduce environmental burdens.

Quality
Supply Chain

Yokohama Works currently operates a total of eight redox flow batteries with a capacity of 4.5
MWh, which consist of four plant-type (first generation) units and four container-type (second
generation) units, next to 15 concentrator photovoltaic panels with a total output of up to 130 kW.
While the batteries are mainly operated for research purposes, some of them are sometimes used tosupply energy to the Works.
Redox flow batteries are characteristically environmentally friendly. While lithium-ion batteries
contain combustible metals such as lithium and sodium and accordingly involve a risk of fire, redox Nobuo Shiga
Chief Engineer
flow batteries, in which the constituent fluid is vanadium dissolved in dilute sulfuric acid, are highly Power Systems R&D Centersafe and involve no risk of fire. They are also practically harmless to the environment and health. The R&D Unit
fluid does not deteriorate even if it is used for many years and can be reused or recycled at the endof life. The chemical substances to be used can also be selected from among multiple options, which leads to the potential oflaunching more reasonable versions in the future.
The challenge of the low storage capacity per volume was solved with the container type, which is the second generation. The
container type currently has a similar level of storage capacity per volume to that of lithium-ion batteries. Sumitomo Electric has
a track record of providing long-life and large-scale (1 MWh or more) redox flow batteries, and I am confident that its
technological know-how is highest in the world in terms of quality and quantity.
We will continuously work to advertise the advantages and reduce the introduction cost to establish the market ofstorage batteries.

Social Contribution

REPORT

0

2013

Core
Category

Eco-ProductsGroup's CSR Activities

20

outs tanding environmental features are exam in e d inaccordance with our Eco Symbol Program, which is based on

Governancedeveloping new products, as well as when making major

registered as Eco-products. The sales ratio in fiscal 2018
was 61%.

Business Outline

Our products are assessed to determine their levels of social

By the end of fiscal 2018, a total of 288 items have been

Basis for Management

Expansion of Environmentally Conscious Products

Human Resources
Environmental
Preservation

Container type redox ﬂow batteries

Concentrator photovoltaic (CPV) system

CSR Report 201976

Initiatives to Address Water Risks
Basic Approach
The impact of global warming on the global environment has
attracted much attention in recent years and water resource
problems are also recognized as large risks that can affectthe operation of the Sumitomo Electric Group. Institutional
investors and clients require us to respond to the problems
to sustain the operation. In addition to the shortage of watersupply, water-related issues include deterioration of water
quality, flood damage, tightening of relevant government
regulations and relationships with communities in theneighborhood. The Sumitomo Electric Group is working tounderstand the current situation of these issues and taking
measures to address them.

Evaluation of Water Risks on a Global Scale
We set up Water Risk Countermeasure Working Group
While Sumitomo Electric has used CDP questionnaires for
information disclosure since fiscal 2016, we did notunderstand what water risks exist in the locations of our basesaround the world or take measures to address them until thefirst half of 2017. Therefore, in the second half of the same
year, we set an activity goal of "establishing a group-widesystem to ensure that the production bases around the world
independently understand the current situation of water risk, ifany, identify the issues and design and implement measures toaddress them."
As the first specific initiative, we set up Water Risk
Countermeasure Working Group with members recruited fromdivisions and affiliates in January 2018 to establish a system topromote the unification of the action procedures to be applied

throughout our group.
Next, we evaluated water risks in a total of 184 areas where our
production bases are located in Japan and overseas. Aqueduct＊

was used as the tool to evaluate the risks based on 12 indicators
in total, including water quantity, water quality, regulations andrelations with neighboring communities, on a five-point scale.
With the results of this evaluation based on Aqueduct, we
identified 32 production bases in Japan and overseas with manyhigh-risk items and surveyed them through interviews tounderstand the actual situation. We also conducted a similarevaluation using Aqueduct in fiscal 2018 and identified fourbases in China where the risk was elevated by one level incomparison with that in fiscal 2017. This information will be usedin the environmental audits of those bases.

Development of the Activities on
a Company-wide Scale
We surveyed risks in our bases in Japan and overseas
On the basis of findings from the above-mentioned risk

survey with Aqueduct, we prepared a questionnaire tounderstand the actual situation of water risks throughout the
Sumitomo Electric Group based on the CDP 2019 water
management indicators. The questionnaire was thendistributed to the 93 production bases in Japan and overseas
selected as the targets for the promotion of environmental
activities to collect information on the risks.

As an overall result, none of the bases were facing any majorrisk that could result in stopping their operation. Accordingly,
we are currently designing measures to avoid risks withpriority given to the risks that are shared by multiple bases
and could have a major impact if they occurred.

Glossary ＊Aqueduct

77 CSR Report 2019

Future Initiatives
We will promote activities involving the supply chain
I n c o r p o r a t i n g t h e c o n c e p t o f t h e C D P 2019 w a t e rquestionnaire into the management indicators, we aim toreach a level where the actual situation of water risks isunderstood and measures to address them are taken. We

will place particular emphasis on the following issues
because we recognize that our activities to address them are
insufficient at present:(1) We will establish the governance, business strategy andtarget of our Group for water-related issues in addition to
the reduction of water consumption.
(2) We will diffuse the risks identified in the above-mentioned
survey and examples of the countermeasures and share
information throughout the Group.
(3) We will also manage the suppliers (the supply chain) as
an initiative to respond to water risks.

Water Use Reduction
We monitor the total amount of water withdrawal
While the Sumitomo Electric Group launched activities toreduce water consumption in fiscal 2008, we set targets forthe reduction of water consumption (with fiscal 2017 as thebase year) as internal indicators in fiscal 2018 and our bases
have individually worked for the reduction since then. Our
water consumption slightly increased year-on-year in fiscal
2018 partly due to the growth of production in domestic
bases where a large volume of water is used. On the other
hand, our water intake decreased from the fiscal 2017 levelas a result of the efforts to reduce it in each of the bases. In
terms of water withdrawal by source, we take 87% of waterfrom municipal water and 13% from groundwater.
In the meantime, the destinations of the effluent are sewer
systems (68%) and rivers (30%) while 2% is discharged into
unknown destinations.
In the course of the reduction activities, we found waterleakage in our facilities, which motivated us to promote efforts
to address and manage water leakage in a steady manner. We
are working to reduce water withdrawal through suchinitiatives as the reuse of effluent that used to be discharged.

Water Withdrawal and Reduction Rate per Unit of Sales(in Japan and Overseas)
Reduction rate per0

Water withdrawal(thousand m3/year)

16,00014,00012,0008,000

14,601

14,260

6,955

8,374

8,104

5,901

5,966

6,227

6,156

2015

2016

2017
Base

2018

11,835

12,381

12,665

12,921

5,757

6,466

6,764

6,078

5,915

2013

2014

10,000unit of sales (%)
0
1
2
3
4.9
4
5

6,000
4,000
2,000
0

Consumption in Japan(Fiscal year)

Consumption in other countries

Reduction rate per unit of sales(Note 1) Water withdrawal is calculated as the sum of the withdrawal of city water, industrial
water and groundwater.
(Note 2) ・ The ﬁgures in ﬁscal 2017, which was the base year for the target, and thereafter were
calculated with four companies including SEEV and SSWT newly added for datacollection. As a result, the water intake in ﬁscal 2017 increased by approximately 1,500
thousand m3.
・ Results in three companies including KPMC are not included in the collection of data on
the environmental performance indicators because they are still working to establish asystem to collect data for water indicators.

A tool developed by the World Resources Institute (WRI) to evaluate water risks in various parts of the world.
Water risks to the bases located on a world atlas are quantitatively evaluated on a ﬁve-point scale.

Biodiversity / Material Balance
Basis for Management

Basic Approach
We work to understand the big picture of environmental burdens and reduce them with the basic idea that all of theenvironmental burdens accompanying business activities have an impact on the biodiversity. In addition, we promote initiatives
that can help protect the biodiversity throughout the businesses of the Sumitomo Electric Group, including the expansion ofenvironmentally conscious products.

INPUT

OUTPUT

Raw materials
353 thousand tons

Iron

399 thousand tons

Aluminum

29 thousand tons

Resin

99 thousand tons

Chemical substances ＊ 14 thousand tons
Product packaging materials‑

2,572 million kWh

LPG

55 million m3

Other fuels

8 thousand kl(converted into crude oil equivalent)

CO2

14,260thousand m3

1,489 thousand tons

Greenhouse gases other than CO2 52 thousand tons

Product design
Manufacture
Shipment

Scope １

209 thousand tons

Scope 2

1,332 thousand tons

Scope 38,272 thousand tons

NOX ＊83 tons

SOX ＊10 tons

Wastewater

Resource
circulation

Wastewater

12,465 thousand m3

WastesRawmaterials
EnergyGeneral wastes

18 thousand tons

Industrial wastes

74 thousand tons

Chemical substance emissions
Into the air ＊48 tons

Into the water ＊1 tonsAs industrial waste ＊(converted into crude oil equivalent)＊●●

Materials (copper, iron, aluminum and resin): Total quantity of the
product materials managed on a weight basis (those used by abusiness unit in the amount of 100 tons or more in total)
Chemical substances: Chemical Substances speciﬁed in the PRTR
(Pollutant Release and Transfer Register) Law
Product packaging materials : Corrugated cardboard, paper, resin
and wood
Electricity : Purchased from electric power companies●

Other fuels: Heavy oil, kerosene, gas oil and natural gas●

Water : City water, industrial water and well water (groundwater)●

Transportation fuel : Gasoline, gas oil etc.

Boundaries of data integration

CO2 emissions ＊38 thousand tons

Product shipments: Total shipments of the product materials
managed on a weight basis (those shipped by a business unit in
the amount of 100 tons or more in total)● CO 2 : CO2 emitted from the use of electricity, gas and fuels● Greenhouse gases other than CO 2 : SF 6 , HFC, PFC and othergreenhouse gases converted to CO2 equivalent● NOx : Nitrogen oxides emitted from the use of gas and liquid fuels● SO x : Sulfur oxides emitted from the use of liquid fuels● Wastewater : Wastewater discharged from plant production
processes, and household wastewater● General wastes: Non-industrial wastes (including paper, wood, ﬁbers and othertrash) generated through business activities (excluding valuable materials)● Industrial wastes: Wastes speciﬁed in Japanese "Waste Management andPublic Cleansing Law," including sludge, waste oils, waste acids/alkalis,
waste plastics, metals, glass, ceramics, cinders and other substances
generated through business activities (excluding valuable materials)●

Supply Chain●

Logistics

132 tons

Quality●

14 thousand kl

Social Contribution

Water

Transportation fuelCore
Category

Water

611 thousand tons

Atmospheric emissions

Research &Development

8 thousand tons

City gas

Water

Product shipments

Group's CSR Activities

EnergyProduction and sales volume

Withinfacilities

Governance

Copper ※Electricity

Business Outline

Material Balance (Environmental Impacts)

Items with ＊: Sumitomo Electric + aﬃliates in Japan; Items without ＊: Sumitomo Electric + aﬃliates in Japan and overseas※In the Environment and Energy Group, which is included in the boundary of data collection, only data on the amount of the materials purchased by
the Procurement Division of Sumitomo Electric alone are covered.

CSR Report 2019

Environmental
Preservation

In promotion of environmental management, Sumitomo Riko Company Limited, Nissin Electric Co., Ltd. and Sumitomo Densetsu Co., Ltd., which arelisted in the stock exchange in Japan, and their consolidated companies are excluded from the boundaries of the environmental management of theSumitomo Electric Group although these companies are included in the boundaries of consolidation for financial reporting.
When the comprehensiveness of the boundaries is assessed based on greenhouse gas (GHG) emissions, a representative environmental indicator, theemissions from the boundaries of the environmental management of our group, 1,541 thousand tons, account for the vast majority of 1,970 thousand
tons, which are estimated GHG emissions from the boundaries of consolidation for financial reporting in fiscal 2018.
In the meantime, out of the 247 consolidated subsidiaries excluding the 3 listed companies mentioned above, the environmental management of ourgroup covers 151 companies in production units (42 in Japan, 33 in China, 38 in Asia (except China), 18 in the Americas and 20 in Europe and other infiscal 2018). Our trial calculation indicates that environmental impact, such as GHG emissions, of the 151 companies is estimated to occupy 99% ofthat of the 247 subsidiaries.

Human Resources

Explanation of the Boundary78

Promotion of CSR Activities in Aﬃliates

Sumitomo Rubber Industries, Ltd.

Web

http://www.srigroup.co.jp/english/csr/

This Basic Philosophy is composed of the CSR Philosophy
and CSR Guidelines. Our CSR Philosophy proclaims that,through our CSR activities, the Sumitomo Rubber Groupaims to become a corporate group that earns the trust ofsociety and is always positively accepted by society.
Meanwhile, our CSR Guidelines specify how we should act
based on this philosophy. There are five core components
to our CSR Guidelines: Green (as in green initiatives),
Ecology (as in reducing the environmental impact of ourbusiness activities), Next (as in next-generation productdevelopment), Kindness (as in kindness to employees andothers) and Integrity (as in integrity for all stakeholders).
Put together, these components spell out the word "GENKI"

GYROBLADE Airless Tire, a product for"Next (Next-Generation Product Development),"
which eliminates the need for the repair of
ﬂat tires or air pressure management
Sumitomo Rubber Industries has created the Sumitomo
Rubber Group's Basic CSR Philosophy in the belief that it isnecessary to establish a clear code of conduct for the(Japanese for "energetic") in reference to the Group's
GENKI Activities, which is an internal initiative that welaunched in 1988 with the aim of energizing employees.
Based on the basic philosophy and guidelines behind our
CSR activities, the Sumitomo Rubber Group will accelerate
the development of its unique ESG activities and contributeto the achievement of SDGs.

Group's overall CSR activities while pursuing social valueeven more actively.

Sumitomo Wiring Systems, Ltd.

Web

https://www.sws.co.jp/en/csr/index.html

CSR priorities, we recognize the significant impact ofcorporate activities on the environment and promote

initiatives to establish a sustainable society based on theEnvironmental Preservation Principles and the Environmental
Preservation Action Guidelines under the slogan of "clean
factories that lead to the future."

For "Contributing to Local Communities," more than 200,000
employees are continuously committed to community-based
activities in their respective areas. As our initiatives forregional revitalization through the promotion of sports, wegive support to PEARLS, a local women's rugby team,including the assistance of the players in their employment.
As of April 2019, seven of the players belong to Sumitomo

Wiring Systems. We also organized a sports festival mainly

79 CSR Report 2019

PEARLS, a women's rugby team supported by
Sumitomo Wiring Systems

for the welfare of employees in conjunction with theSumitomo Wiring Systems is committed to CSR activities

approximately 1,940 employees and their family members in

can serve as centers and foundations for sustainable growth

for the support of athletes and the promotion of sports asenable the Sumitomo Wiring Systems Group to realize its

Toward the next 100 years, Sumitomo Wiring Systems willfamiliarity and accessibility" and "Living with local

environmentally friendly products to as many customers as

For "Global Environment Conservation," which is one of the

loved by local people.

women's rugby competition held in our neighborhood in

Suzuka, Mie Prefecture. The two-day event was visited bywhile setting its eight priorities for them, including areas that

total to help cultivate a sense of unity. We will keep striving

as well as our roles as better corporate citizens, which will

mentioned above.

ideal image ("Globally common best quality," "Trust,

continue to deliver safer, more convenient and morecommunities").

possible to become a company rooted in the region andSumitomo Riko Company Limited

Web

https://www.sumitomoriko.co.jp/english/csr/portal"Automotive (Mobility)," "Infrastructure and Housing
Environment," "Electronics" and "Healthcare," as well as thebusinesses for the next generation, to achieve the targets
presented in the table on the left.
We also revised our Corporate Action Charter, which
describes the action principles to become a company that
contributes to a sustainable society, in April 2019. Basedon social demand, which is typified by SDGs and therevision of the Charter of Corporate Behavior by Keidanren(Japan Business Federation), we incorporated new
perspectives, including solution of social challenges
through innovations, responsible procurement, respect forhuman rights and diversity & inclusion, into the charter tomake it a business foundation for the achievement of
2022V.
Sumitomo Riko issued the Sumitomo Riko Group 2022

With 2022V as the milestone to be reached, Sumitomo

Vision (2022V) in May 2018, which aims to create social

Riko aims to become a Global Excellent Manufacturing

value by enhancing corporate value (financial objectives)

Company, which we define as a company that contributes

and public value (non-financial objectives) simultaneously.

to safety, comfort and the environment of people, societyWith the three business strategies of "Creation of new

and the Earth.

businesses and new customers," "MONOZUKURI
innovation" and "Strengthening of global businessfoundations," we are committed to the four fields ofNissin Electric Co., Ltd.

Web

http://nissin.jp/e/company/report.html

an extension the development of the industry. Throughout
the period, we have constantly upheld the "Five Trusts" withstakeholders embodied in our Principles of Activities whichstate "Integrity, Trust and Long-term Relationships."
Based on the Basic CSR Promotion Policy, our group iscommitted to initiatives to reduce environmental burdensand conserve the environment with focus on coexisting withthe environment, as well as fair and transparent corporate
management grounded in compliance with laws and social
norms at its core, while striving to further enhance the Five
Trusts.
For example, as a social contribution activity in fiscal 2018,
we started forest preservation activities through cooperation
between local people and our employees. Also, we havecontinued the maintenance and preservation of Sekison-tei,which is the former residence of literary legend Junichiro
Tanizaki and currently used as a guest house of our group,
as well as a full grant-based scholarship program fortechnical graduate students through Nissin Electric GroupThe Nissin Electric Group was founded in 1910 by Nobu

Foundation for Social Contribution.

Tomizawa with the mission to contribute to the new

The Nissin Electric Group will continue to contribute todevelopment of the power system equipment industry. Since

creating a vibrant society in harmony with the environment

then, we have continued with our efforts to assist thethrough Corporate Activities that support the foundations ofdevelopment and expansion of power infrastructure, and associety and industry.

CSR Report 201980

Independent Third Party Assurance Report

81 CSR Report 2019Comments from an External Expert

My ﬁndings from CSR Report 2019 (hereinafter "this Report") on Sumitomo Electric Groupʼ s activities and eﬀorts to
fulﬁll their social responsibility, and disclose relevant information, are as follows:
The century of electricity and the pride of the Sumitomo Electric GroupOne of the expressions that describe the 20th century is "thecentury of electricity." Also in the 21st century, people havegreat expectations for progress in technologies that cannot be
achieved without electricity such as electric vehicles, 5G and
artiﬁcial intelligence.
It is considered that the widespread use of various
electricity-based technologies has made society prosperous.
Telecommunications explosively expanded communication
activities between people. Railway services were abreakthrough that enabled people to travel easily. Moreover,when the light is switched on for the ﬁrst time in an area thatwas unelectriﬁed before, its greatest impact is considered to
be to allow children to read books at night.
The target 7.1 of the sustainable development goals (SDGs)
adopted by the UN also includes a phrase "to ensure universal
access to aﬀordable, reliable and modern energy services by2030" and one of the indicators proposed to measure theprogress is the proportion of population with access to electricity.
The widespread use of electricity, as well as technologies thatuse it, will be also a steady trend in this century.
Originating from the Sumitomo copper business, the Sumitomo
Electric Group has provided the world with various productsthat are essential for the widespread use of electricity andvarious technologies based on it. Although this may be too
obvious to say, I guess that the Group has pride and belief thatthey have already contributed to society through their main
business and can continue the contribution in the future.

I dare to expect even more contribution
On the other hand, even if the widespread use of electricity andtechnologies that use it is a steady trend, it is also a fact thathuman beings are facing big challenges about how to generate
and use electricity. They include (1) generation of electricity
without posing a threat to people, (2) storage, distribution anduse of electricity as eﬃciently as possible and (3) eﬀorts torecycle all items related to electricity. Unless such challenges are
overcome, people would not be completely happy even if
electricity and technologies that use it are more widespread.
Such a prediction makes people anxious about the future.
I believe that the Sumitomo Electric Group can play a role ineﬀorts to respond to the challenges and make further social
contribution in the future through activities such as the expansionof renewable energy projects, the development of high-voltage
DC cable projects, the exploration of technologies for power
storage systems and the promotion of the recovery and recyclingof various products. There are a large number of ﬁelds for the
future in which the Group can clearly aim to make contribution.

For the improvement of the CSR report
I can say that this report is successfully completed in terms ofthe comprehensive and detailed description of how the Grouphas handled the items required in corporate activities in recent
years based on the pride that it has already contributed tosociety through its main business and can continue thecontribution in the future. Even when it is compared with thereport for the previous ﬁscal year, major improvements havebeen made especially on the disclosure of the description andexamples of initiatives in overseas business sites.
I hope that the next report has more pages on the "ﬁelds forthe future in which the Group clearly aims to makecontribution." Although articles on pages 33 to 42 of this reportdeal with a similar subject, the current and future perspectives
are so mixed. While the articles introduce the activities of eachdivision, I could not ﬁnd linkage with the target businessportfolio to be achieved, which is described in P8. It is notnecessary to refer to SDGs or ESG. While concentrating on
businesses in the electric industry, the report should mention
the awareness of social problems and commitment to newchallenges a little more eloquently. I am sure that this is the
only way to clarify to the readers the elements of "better
society". And I am also sure that this is a way to communicate
the process of creating societal
values by the Group, citing"Contributing to a better society byleveraging our expertise inconnectivity and transmission
technologies through concerted
eﬀorts of the entire group".

Eiichiro AdachiCounselor,
The Japan Research Institute, Limited

Sumitomo Electric's Response to the Findings

Yoshitomo Kasui

Senior Managing Director
and Chairperson of
the CSR Committee

We thank Mr. Eiichiro Adachi for assessing the content of this report and providing suggestive opinions on our group's
activities to fulﬁll our social responsibility and information disclosure. We are humbled by his great expectations on us, suchthat, while a vague feeling of anxiety that the future may not be imagined as an extension of the current status is spreading
in society, we can play a role in addressing it and other challenges for the future, in addition to conventional social
contribution through the main business.
Sumitomo Electric has tackled social demand under the Sumitomo Spirit since its founding. "Fusu-furi" indicates theimportance of working proactively, pursuing proﬁt by quickly and appropriately responding to changes in society and making
decisions on the adoption or abolition of business projects without being content with the status quo while also strongly
admonishing us against acting rashly or carelessly in pursuit of immoral business. In the meantime, "Mutual Prosperity,
Respect for the Public Good" represents the principle that we should not only pursue proﬁts but always seek the harmony ofbusiness gains with the public interest. We have renewed recognition that companies are required to pay deﬁnite attention
to future generations along with the current generation more clearly than ever.
In VISION 2022, which we announced last year, we aim at "Contributing to a better society by leveraging our expertise inconnectivity and transmission technologies through concerted eﬀorts of the entire group" to become a Glorious Excellent
Company, which is our ideal future state. The comments from Mr. Adachi made us conﬁrm that we are in the right direction.
To ensure that our stakeholders enhance their understanding of our activities in the "ﬁelds for the future in which the Group
clearly aims to make contribution" and attach a higher value to them, we will continue to further develop the CSR activities inthe entire group.
The Findings by an External Expert in this English version are a translation of the original text in the Japanese version.

CSR Report 201982

Administration Division (CSR Promotion Oﬃce)
1-3-13, Motoakasaka, Minato-ku, Tokyo, 107-8468 JAPAN

Phone: +81-3-6406-2611 Fax: +81-3-6406-2700［URL］https://global-sei.com/csr/

A（2）-060002

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Sumitomo Electric
supports an initiative
to preserve forests bypromoting the use ofdomestic timber

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［Published November 2019］