CSR Report 2018

CSR Report 2018

Editorial Policy
Period Covered by This CSR Report
April 1, 2017 through March 31, 2018 (ﬁscal 2017).
Some activities conducted in ﬁscal 2018 are
alsocovered.

Boundary of This CSR Report
Sumitomo Electric Industries, Ltd. and its consolidated
subsidiaries (358 companies)
In this CSR Report,“Sumitomo Electric,”“the Company”
o r“ o u r c o m p a n y ”r e f e r s t o S u m i t o m o E l e c t r i c
Industries, 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 P73 to 74.

● For details of the boundary of data collection forenvironmental indicators, see Explanation of theBoundary in P65.

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 2012 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 2018
(Last CSR Report: published in November 2017; andnext CSR Report: scheduled for release in November
2019)

01 CSR Report 2018

Basic Value Standards

Business Outline

05

Top Message

07

Mid-term Management Plan 22VISION

09

Financial and Non-Financial Highlights

11

Our History and Business

13

Automotive

14

Infocommunications

15

Electronics

16

Environment & Energy

17

Industrial Materials

18

R&D Group

19

Global Business Expansion

212017 Highlights

23

Corporate Governance25

Risk Management

27

Compliance

29

Respect for Human Rights

30

Relationships with Stakeholders

31

CSR Management

33

Targets and Actual Results in Fiscal 2017 /Targets for Fiscal 201835

CSV Activities

39

Social Contribution Activities

C S R
R E PORT
2 0 1 8C O N T E N T S

Social Contribution

Social Contribution

Quality

41

Product Quality & Product Safety

Core Category

Supply Chain45

Supply Chain

Core Category

Human Resources

49

Diversity

53

Safe and Sound Workplace

57

Human Resource Development

59

To Become a Company with the Highest Level of Safety

61

Environmental Management

66

Activities to Prevent Global Warming

69

Promotion of Resource Conservation and Recycling

70

Reduction of the Release of Harmful Chemical Substances

71

Initiatives to Address Water Risks

72

Environmentally Conscious Products

73

Promotion of CSR Activities in Aﬃliates

75

Independent Third Party Assurance Report

76

Comments from an External Expert

Human Resources
Environmental
Preservation

CSR Report 2018

Supply Chain

Environmental
Preservation

QualityCore Category

Core CategoryCore
Category

Core Category

Group's CSR Activities

Group's CSR Activities

Governance

GovernanceBusiness Outline

03

Basis for Management

Basis for Management

02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 2018

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

Business Outline

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“goodcorporate 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 2018

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

We contribute to a better society
by leveraging our expertise inconnectivity and transmission technologies
that we have developedsince our foundation

Osamu Inoue

President & COO Sumitomo Electric Industries, Ltd.

fibers and cables.

Preface

Despite the fact, we failed to reach the numerical targets

I sincerely express my gratitude for your continued
support and understanding of Sumitomo Electric Group'sbusiness activities.
In fiscal 2017, which was my first year as the president
as well as the final fiscal year for our

mid-termmanagement plan "VISION 2017," we achieved
consolidated net sales of 3,082.2 billion yen, operating
income of 173.1 billion yen and profit attributable toowners of the parent of 120.3 billion yen, which were allrecord highs. The factors contributing to this included
strong demand for wiring harnesses, powder alloy andsintered parts with an increase in car production mainly
outside Japan, as well as growth in demand for

set in the interim revision in fiscal 2015 except the one
for ROE＊. By business segment, while most of thenumerical targets were achieved in the three segmentsof Automotive, Infocommunications and Industrial
Materials, the results were slightly below the targets in
Environment & Energy and far below the targets inElectronics. Although we failed to reach the targets, thesegments covered for each other to increase net sales
by about 900 billion yen and operating income by about
100 billion yen over the five years from fiscal 2012,
which was the concluding fiscal year for VISION 2012. I
think that we have managed to show a steady growtheven in the uncertain economic conditions.

information and communication products such as optical

Glossary ＊ROE(Return On Equity)

05 CSR Report 2018

Proﬁt Attributable to Owners of the Parent/Owner's equity

Basis for Management

New Mid-term Management Plan
"VISION 2022"

information network fields and commercialization withagility, as well as the development of forward-looking
innovative technologies.

Our new mid-term management plan "VISION 2022" was2022 is to contribute to a better society with theconcerted efforts of the entire Sumitomo Electric Group
based on the connectivity and communications
technologies that have been continuously cultivated by
the Group for 120 years since its foundation. This idea
has also been incorporated into our new taglinewith "Connect" representing our intent to strongly
connect our business to society and stakeholders andwith "Innovation" showing our commitment to
responding to social changes by further evolving
wide-ranging core technologies of our Group. With thistagline, we will strive for growth in the conventional
for the creation of new products and services that
support the development of a better society throughinnovation.

Electric Group Corporate Principles continue to serve as
the basic value standards that guide us in our efforts to
help make society "safe and secure," "environmentallyfriendly" and "comfortable and have much potential for
growth." Especially in terms of contribution toenvironmental issues, in addition to energy saving inindividual products, we will propose a power systemthat also addresses the management of renewableenergy to facilitate the more widespread use ofenvironment-friendly energy. A major problem in theGroup's CSR Activities

fields of Mobility, Energy and Communications as well as

In VISION 2022, the Sumitomo Spirit and the Sumitomo

Governance"Connect with Innovation." This tagline was generated

Deepening of CSR Commitment in
an Environmental Context

Business Outline

launched in May 2018. The basic concept of VISION

world, particularly in Asia, is water pollution. We plan to
introduce a water processing project based on theunique membrane technology of our Group into various
parts of the world. These and various other values
offered by our Group will correspond to the Sustainable
Development Goals (SDGs) adopted at a UN summit in2015, which are now widespread among companies.

Core
Category

Priority Initiatives
VISION 2022 has set three priority initiatives under the(manufacturing base, human resources andorganizational base and financial base). The first initiativeis "Enhancement of Manufacturing Capabilities." Each

Deepening of CSR Commitment ina Social Context

Management & Engineering Unit is now promoting

working hours. For example, we set reduction ofcross-departmental activities throughout the Company.

overtime work and encouragement of employees to take

Our targets are the achievement of zero accident inpaid holidays as the targets and work to improve thepeople, goods and equipment to become a company

productivity as an initiative to solve the root cause.

with the highest level of safety in the world;

We also intend to become a company where employees

development of "strong factories" through continuous

can select a work style from among various options

improvement; and promotion of the sharing of best

according to their own circumstances irrespective ofpractices among Group companies to demonstrate ourgender or whether they have disabilities or not, bystrength in an integrated manner.

promoting diversity management that is more in tune

The second is "Increasing Global Presence." We willwith the times. In addition, we will enhance CSR

further increase global transactions to gain a higher

procurement to establish a healthy partnership withshare and also aim to create innovative business models

suppliers.

that anticipate market changes in the world.

"Glorious" of the "Glorious Excellent Company," which is

The third is "Creation and Enhancement of Leading

our goal, represents an unchanging value for us as aTechnology." With our R&D Group playing a pivotal role,

corporate person. We will continuously strive to

we will continue to enhance core technologies andmaintain such a state and work to fulfill our social

combine them to propose superior solutions andresponsibility with the unshakable principle that also

strengthen the competitiveness of our existing business.

corresponds to the ideas of compliance and CSR today.

In particular, the keys are the creation of innovation that
anticipates changes in the automotive, energy andEnvironmental
Preservation

Group is likewise promoting the reduction of long

Human Resources

crucial issue throughout Japan. The Sumitomo Electricmanufacturing company, and the Manufacturing

Supply Chain

Work style reforms have been recently recognized as a

S E Q C D D＊, w h i c h a r e e s s e n t i a l s u b j e c t s f o r a

Qualitydivision of our Group is committed to strengthening

Social Contribution

three bases of the Sumitomo Electric Group

Glossary ＊SEQCDD

SEQCDD stands for safety, environment, quality, cost, delivery and R&D, which are
fundamental components in the business activities of the Sumitomo Electric Group.

CSR Report 201806

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 Group’ s ideal future state. With focuses on commitment to enhancing
corporate values founded on the Sumitomo Spirit and the Sumitomo Electric Group Corporate Principles, we will fulfill oursocial responsibility through business activities.
While striving for the improvement of our Manufacturing Base, Human Resources and Organizational Base and Financial Base,as well as growth of our business in the five business segments of Automotive, Infocommunications, Electronics, Environment& Energy and Industrial Materials, we will be committed to enhancement of manufacturing capabilities, increasing global
presence and creation and enhancement of leading 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

Energy

s
ain
dom
ese
h
t
t
por
s sup
lutionand so
,
s
t
c
u
d
o
, pr
A diversity of materials

Mobility

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 2018

Basis for Management

Targets
FY2017
ResultFY2020Interim Target

FY2022
Target¥3,600 billion¥173 billion¥200 billion¥230 billion

Operating Margin Ratio

5.6%

5.9%

6.4%

ROIC＊

7.9%

8.5% or more

9% or more

ROE

8.1%

8% or more

8% or more

Operating Income

Capital investment (5-year cumulative amount)¥950 billion

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

Governance¥3,400 billion

Business Outline¥3,082 billion

Net SalesGroup's CSR Activities■ We aim for a new-product sales ratio of 30%.
■ 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

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

Glossary ＊ROIC：Return on Invested Capital
Operating Proﬁt / Invested Assets=Operating Proﬁt/(Total Assets－Interest-Free Liabilities)

CSR Report 2018

Environmental
Preservation

Creation andEnhancement of
Leading Technology●

S (Safety)
E (Environment)
Q (Quality)
C (Cost)D (Delivery)
D (Research ＆
Development)

Human Resources

Increasing
Global Presence※ SEQCDD

Supply Chain

Enhancement of
Manufacturing
Capabilities

Taking“SEQCDD※”one step further

08

Financial and Non-Financial Highlights

F i n ancia l O verview
Sales in Japan and overseas and ratio of overseas sales by year
Ratio of overseas sales (%)(100 million yen)

48.6

30,00025,00020,00015,00025,688

59.5

58.3

55.2

35,00028,22814,17028,145

60

1,731

1,600

30,82250

16,46817,461

16,537

18,388

40

1,400

1,201

910

768

11,76011,87011,60812,434

2012

2013

2014

2015

2016

2017

1,076

1,203

380

400

11,518

1,505

667

600

11,111

1,435
1,345
1,198

1,000
800

10,0005,000(100 million yen)

1,800

1,200

21,59910,48829,331

59.7

58.8

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

200
0

0

Overseas

Ｉn Japan

2012(Fiscal year)

2013

Operating Income

Ratio of Overseas

2014

2015

2016

2017

(Fiscal year)

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

Total Assets and Net Assets (Consolidated)

Return on Equity (ROE) and Return on Invested Capital (ROIC)(100 million yen)（％）
10

35,00029,25830,00025,00022,97625,54812,447

29,0739.1

30,1738

6.6

20,00015,00027,42816,46913,79915,613

16,286

17,6416

4.8

410,000

6.8
6.5

5.9

7.2

8.1
7.9

3.7

2

5,000

6.5

7.7

0

0

2012

Total Assets

2013

2014

2015

2016

2017

Net Assets

ROE

Capital investment(100 million yen)

1,479

1,508

1,482

1,673

1,837

1,200

1,711

1,000

2015

2016

2017

1,152

1,177

2016

2017

(Fiscal year)

943

995

1,056

1,108

800

1,200
1,000

600

800

400

600
400

200

200
0

0

2012

09 CSR Report 20182014(100 million yen)

1,800
1,400

2013

ROIC

R&D expenditures

2,000
1,600

2012

(Fiscal year)

2013

2014

2015

2016

2017

(Fiscal year)

2012

2013

2014

2015

(Fiscal year)

Basis for Management

N o n - fina ncia l O verview(Persons)

82.0

250,000

206,323

200,000

225,484

84.5

84.2

84.0

83.8

83.3

300,000

100,000

187,7691.68

84

240,798 240,865 248,330

83

255,133

82
81(Persons)

50

1.20
1.02

40

29

30

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

20

7

0

0

37,14837,71538,892

38,53739,236

39,637

2012

2013

2014

2015

2016

2017

Overseas

Ｉn Japan

1.45

38

40
28

10
2014

（％）

2,024

1,999

2.1

2.01 2.02

2.00
1.91

1.9

1,800

2.05

2.11

2.17 2.17

2.29

Legally required percentage

1.8

0

0

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (Year)(Note 1) The graph above covers personnel data for Sumitomo Electric employees (including thoseon loan to Sumitomo Electric aﬃliates and other organizations within the facilities).

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

(Note 2) The data are based on January to December in 2017

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

1.5
1

1.9

1.83

1.8

1.62 1.61 1.62 1.59 1.58 1.66 1.61 1.63 1.66

1.15
1.02
1.02 1.09 1.12 0.99 0.98 1.05 1.00 0.94 1.06 1.06

1,600
1,400
1,200
1,000

0.5 0.33

00.16 0.10
0.08

0

0
0

0

0.08 0.14

000.07 0.07

02006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

(Fiscal year)

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

1,456

-3

2.3

2.7
1,430

1,497

1,503

0

(Note 2)

3

1,436

682

681

711

700

732 728

696

787

761

744

730

764 776

741

600
400
200

0

2012
Base

In Japan2013
ResultOverseas

2014
Result2015
Result2016
Result2017 (Fiscal year)
ResultReduction ratio(Note) For detailed notes on the above graph, see Note 1 and Note 2 of the graph ofGreenhouse Gas Emissions and Reduction Ratio (in Japan and overseas) in P66.

Environmental
Preservation(Note) The lost time injuries frequency rate for employees in Japan in the Sumitomo ElectricGroup covers Sumitomo Electric and its 40 aﬃliates in Japan (excluding SWS and theother listed companies), and the frequency rate in SWS covers SWS.

800

1,442

Reduction ratio (%)▲2.3

Human Resources

00.20 0.14
0.19 0.14 0.11 0.13
0.06
0.03

0.9

1.9

1,469

▲1.9

Supply Chain

Emissions converted
to CO2 equivalent(thousand tons0
CO2e/year)（Frequency rate）

2

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

Quality2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 (Year)

Social Contribution

2.0

1,965

1,850

2.2

2.21

Core
Category

2,031 2,042 2,023

2,042 2,042 2,047

2,000
1,900

Employment rate as ofJune 15 of each year

2.3

2,049

(Fiscal year)

Group's CSR Activities(Hours)

2,050

2017

Share in section managers or higher positions

Employment Rate of the Physically or
Mentally Disabled by Year

2,068

12

10
2016

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

Average total working hours by year

2,100

34

30

10
2015

46

No. of general managers or higher positions

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

2013

1.40

22

17
8

2012

Ratio of Overseas

32

25
22

10

50,000

1.28

（％）
1.7
1.6
1.5
1.4
1.3
1.2
1.1
1.0

Governance

169,175

as of January 16 ofeach ﬁscal year85

80

150,000

Number and share of women in
section managers or higher positions

Business Outline

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

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 201810

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
1900
1908
1909
1911

1916
1920
1931

1932

Sumitomo Copper Rolling Works was founded.

1939

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

Started production of coated wires.

1941

Opened the Itami Works.

Started production of power cables.

1943

Started production of anti-vibration rubber and fuel tanks.

Started trial production of telecommunication cables.

1946

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

1948

Started marketing sintered powder metal products.

1949

Entered into the business of construction of overhead transmission lines.

1957

Delivered the ﬁrst Japan-made television broadcasting antennas.

1961

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

1962

Started production of IRRAXTM Tube electron beam irradiation tubes.
The Head Oﬃce was moved from Osaka's Konohana Ward to
the present address in Chuo Ward.

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.
Started development of ﬂexible printed circuits (FPCs).

Established Sumitomo Electric Wire & Cable Works(the foundation of the Company).
Manufactured and supplied the ﬁrst Japan-madeunderground high-voltage (11,000 V) cables.
Opened a new factory (now the Osaka Works)
Started production of enamel wires.
Incorporated Sumitomo Electric Wire & Cable Works as a limited company(the establishment of the Company).
Started production of cemented carbide “IGETALLOY”() tools.
Started production of special steel wires.

11 CSR Report 2018

Basis for Management

Automotive
Responding to safety, amenity and environmental needs of future motorized society

Business Outline

With a focus on the interface between the vehicle and driver, Sumitomo Electric oﬀers various products to the global market. A
representative example of these products is a wiring harness that transmits electric power and information to various points in an
automobile. Growing public demands for more eco-friendly vehicles require the supply of sophisticated hybrid and electric vehicle partsand ITS-related products based on a wide variety of advanced technologies. Keeping in mind“the next generation with harmony
between vehicles and people,”Sumitomo Electric will continue developing a variety of new automotive products in order to contributeto the creation of a comfortable automobile society.

Electronics
Supporting advancement in the functions and performance of electronics

GovernanceIn the electronics ﬁeld, devices are required to be ever smaller, lighter, more functional, and more sophisticated. To meet theserequirements, Sumitomo Electric has been expanding its product lineup by continuously developing new materials, wires and otherparts. Sumitomo Electric's leading-edge Technologies have been employed eﬀectively for advanced medical, automotive and aircraft
equipment, as well as for widely used products such as smartphones and tablet PCs.

Environment & Energy
Group's CSR Activities

Supporting a stable energy supply
Since its establishment, Sumitomo Electric has made eﬀorts to develop wire and cable technologies that are essential for ensuring astable power supply. The Company is now moving toward new businesses in the ﬁeld of renewable energy and smart grids to supply
environmentally friendly and energy-eﬃcient products to the global market, thereby contributing to upgrading social infrastructure.

Core
Category

Infocommunications
Sumitomo Electric provides various solutions that make our society safer, more secure and more comfortable. A wide array of thesesolutions include optical ﬁbers/cables and other telecommunication-related products necessary for FTTH and other optical network
construction and access-based network products. We will continue to develop innovative technologies and products and supply themto customers, thereby contributing to the construction and upgrade of broadband network infrastructures.

Social Contribution

Supporting communications

Quality

Industrial Materials
Using a wide range of technologies for the prosperity of industrial society
Taking advantage of its material development capabilities based on electric wire/cable drawing technology, Sumitomo Electric hasdeveloped various products with unique features, including PC steel wires, steel tire cords, and other special steel wires essential forand household appliances and synthetic diamond called the ultimate material. Various products made from these sophisticatedindustrial materials support the bases of industries, thereby contributing to the development of society.

Started production of compound semiconductors.

1971

Opened the Kanto Works.

1975

Contracted to construct a power transmission line in Iran.

1974

1976
1978
1982
1996
1998
1999

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

2008

Opened the Technical Training Center.
Sumiden Friend, Ltd. (Special subsidiary) started operation.

2009

Sumitomo Electric Device Innovations, Inc. was organized.

2010

Opened the WinD Lab, a new laboratory building.
SEI Optifrontier Co., Ltd. was organized.

2014

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

Started production of optical ﬁber cables.
Received an order for a large telecommunications network project in Nigeria.
Delivered and put into operation the world's ﬁrst bi-directional ﬁber
optic CATV system“Hi-OVIS.”
Delivered the ﬁber optic LAN system for the ﬁrst time in its history.
Succeeded in producing the world's largest synthetic monocrystalline
diamonds (1.2 carats).
Developed a technology for producing long-length oxide
high-temperature superconducting wires.
Developed and started marketing ecology wires and cables.
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.

CSR Report 2018

Environmental
Preservation

1981

2003

Human Resources

1970

Supply Chain

civil structure construction. The Company also supplies a wide variety of superior materials including sintered parts used in automobiles

12Automotive

Pipe-shielded wiring harnesses for HEVs

Anti-vibration rubber products

Charging connector for EVs◆ VISION 2022 Mid-term Management Plan:

Segment Strategy

Ideal Future State

Become a mega-supplier withthe wiring harnesses business at the core.

Ratio of thebusiness unit
in the total sales

51.6％

1,631,952(million yen)

Ratio of thebusiness unit in thenumber of employees

Growth Strategy
●
●

●

●
●

76.9％

Promote“Concept-in Activities for Customers”

Strengthen collaborative relationships withthird parties (OEMs, the public sector, service providers, etc.)
Strengthen our business base throughthe consolidation of the Group’s resources.
Expand sales targeting global customers
Generate new CASE -related products※※CASE: A concept of connectivity, autonomous driving, shared services andelectric mobility formulated in the automotive industry(Note) The net sales in eachsegment include internalsales between segments.

196,177(persons)〈Growth Strategy〉
While the development of CASE-compliant products is
accelerated, it is forecast that the global sales ofautomobiles continue to increase and the market forenvironment-friendly vehicles significantly grows withtightening regulations and other factors. Under such anenvironment, the Sumitomo Electric Group will
introduce a wide range of new products based on ourState of the Market
●
●

●

●

Continuously growing automotive sales worldwide
Growth in eco-friendly vehicles in line with tightening
environmental regulations (ZEV＊, CO2 regulation, diesel bans)
An auto industry revolution; accelerating improvement
delivered by CASE
Vendors from other industries entering the market,changing the supplier vantage-point
Our Strengths●●●

Comprehensive and dominant market presence in the wiring harnesses
business via the trinity system, comprising Sumitomo Electric,
Sumitomo Wiring Systems and AutoNetworks Technologies

Global business deployment (33 nations)
Our business in power systems, telecommunications andindustrial materials enables shared expertise benefiting
the development of applicable products for the auto industry

comprehensive and dominant market presence in thewiring harness business on a global scale that has beencultivated via the trinity system with Sumitomo Electric,
Sumitomo Wiring Systems, Ltd. and AutoNetworks
Technologies, Ltd. respectively in charge ofmarketing/planning, manufacturing and development,
as well as the Group's technologies related to power,
communications and materials.
We will enhance our capabilities to make aggressive
proposals to customers and also accelerate thedevelopment of new products by enhancing internaland external cooperation and making effective use ofresources. We will expand our sales to global
customers including those in China, Europe and theUnited States in addition to our conventionalcustomers, and aim to become a mega-supplier ofvibration control materials and other products
centering on wiring harnesses.

Glossary ＊ ZEV

13 CSR Report 2018

Zero Emission Vehicle

Basis for Management

Infocommunications

Business Outline

Optical transceivers

Broadband network service products

Governance

Multicore optical ﬁber cables◆ VISION 2022 Mid-term Management Plan:

Segment Strategy

Ideal Future State

7.0％

220,326(million yen)●Pursue the development of innovative products andproposals that exceed customer expectations while
increasing global market presence.

innovate IoT-related production technologies andfacilitate expansion of our global business base.

●

Increase in the amount of data traffic due to development ofhigh-capacity mobile networks (4G to 5G); spread ofvideo streaming services; and transition to cloud services
Further expansion of infocommunication network market●

Increasing demand for sensors to be used for facial recognition
and autonomous driving
Our Strengths●●

Superior manufacturing technology for ultra-low loss optical fiber
cable enabling high-speed, high-capacity telecommunication●

Leveraging optical precision-molding and mechatronics technologies●

Software development capability for visual- and optical-access devices●

Compound semiconductors for optical/wireless applications developed
via collaborative vertical integration from raw materials to finished devices

Due to the rapid spread of IoT, the growth of video
streaming services and cloud services and otherfactors, we expect to see a sharp increase in traffic
data and investment in the expansion of data centersto respond to them. It is also anticipated in this fieldthat technical innovation will be made at a furious paceto facilitate the development and commercialization ofhigh-speed optical communications and 5G wirelesscommunications.
Sumitomo Electric will develop and propose uniqueproducts based on capabilities to develop andmanufacture special optical fibers andultra-high-fiber-count optical cables enablinghigh-speed, high-capacity telecommunication, opticalprecision-molding and mechatronics technologies,
capabilities of development via vertical integration fromcompound semiconductor materials to finished devices
and capabilities to develop software related to
network access devices. We also aim to expand our

global market share and especially become a leading
supplier in the high-capacity network andinterconnection markets centering on the technologies
for high-end optical fibers, optical fiber connection,transmission devices, compound semiconductors andnetwork access devices.

CSR Report 2018

Environmental
Preservation

Established manufacturing technology for ultra-high-fiber-count
optical fiber cables〈Growth Strategy〉

Human Resources• Growth in the capacity of submarine/onshore cables and cables fordata centers and rising demand for optical fibers and their connection• Advances in the speed and capacity of optical/electronic devices• Expanded demand for data security

7,218(persons)

Supply Chain

State of the Market●(Note) The net sales in eachsegment include internalsales between segments.

Quality

Continuous enhancement of our business base:

2.8％

Social Contribution●

Consolidate our core technology to support
IoT-based societies.

Core
Category

Ratio of thebusiness unit in thenumber of employees

Growth Strategy●

Group's CSR Activities

Become a leading supplier in high-capacity network andinterconnection markets centering on the technologies forhigh-end optical fibers, optical fiber connection,transmission devices, compound semiconductors
and network access devices.

Ratio of thebusiness unit
in the total sales

14Electronics

Flexible printed circuits (FPC)

SUMITUBE TM

SUMI-CARD TM◆ VISION 2022 Mid-term Management Plan:

Segment Strategy

Ideal Future State
Become a top global supplier of unique

Ratio of thebusiness unit
in the total sales

7.8％

high-performance cables, components and materials

246,319with a focus on mobile devices and mobile electronics.

(million yen)

Ratio of thebusiness unit in thenumber of employees

Growth Strategy●●●

Strengthen global sales and manufacturingassets primarily in North America,
China and other Asian nations.
Strengthen our development and proposition systems
to meet market demands for new functions andmore innovative, light, tough and precise productsthat facilitate high-speed data transmission.
Strengthen manufacturing capabilities andbusiness bases to become more agile and responsive
to client demands within a shorter business cycle.

9.2％(Note) The net sales in eachsegment include internalsales between segments.

23,529(persons)〈Growth Strategy〉
We anticipate that smartphone, tablet and othermobile device markets will continue to grow and thatan increase in the transmission information volume will
boost demand for new functions and new standards.
We also expect a rising demand for our high-function

State of the Market●●●

Continuous growth of the mobile device market and introductionof new functionalities and new standards in association withan exponential increase in data transmission volumes
Shifting demand from traditional electronics sector to
the auto industry as demand for greater sophistication in
EVs and autonomous driving continues to riseContinuing demand for further computerization andweight reduction of aircraft and vehicles
Our Strengths●●●

Solid partnerships with clients who lead growing markets
Unique materials development, design and processing expertise
including high-speed transmission, heat-resistant, high-precision,
porous-membrane and electric-beam irradiation technologies
Providing customers around the world with high-function
wiring, protective-layer wiring and other high-functionality
products via our global supply chain

15 CSR Report 2018

wiring materials with the widespread use ofEVs(electric vehicles) and growth of the aircraft
industry.
Sumitomo Electric will accelerate the development of
new products and ensure commercialization of thembased on our unique core technologies for materials,
processing and mounting that include high-speed datatransmission, heat-resistant, high-precision andporous-membrane technologies. We also aim tobecome a top global supplier of uniquehigh-performance cables, components and materials
with a focus on mobile devices and mobile electronics.

Basis for Management

Environment & Energy

Business Outline

High-voltage optical ﬁber composite submarine cables

Magnet wires

Governance

Copper wire rods

◆ VISION 2022 Mid-term Management Plan:

Segment Strategy

Ideal Future State

22.7％
７１７,９７２(million yen)

Meet demand for new products such asrectangular wire for drive motors supporting
EV development and environmental issues.

(Note) The net sales in eachsegment include internalsales between segments.

13,651(persons)〈Growth Strategy〉
We anticipate growth in major international
grid-interconnection projects primarily in Europe andinfrastructure demand in emerging countries, as well as

Quality●

Provide products and systems that fit a rapidly changing
energy market as evidenced by growing investment inrenewable energy and growth in EVs.

5.4％

Social Contribution●

Build a stronger global presence for the development
and provision of electrical power infrastructure
including long-distance submarine cables, etc.

Core
Category

Ratio of thebusiness unit in thenumber of employees

Growth Strategy●

Group's CSR Activities

Become a global supplier thatoffers a whole range of environmental andenergy products and systems.

Ratio of thebusiness unit
in the total sales

increasing use of renewable energy and rising demand
for the development of power feeding infrastructure in

●

●
●

●

Launching of major international grid-interconnection projects,
primarily in Europe

Sumitomo Electric will strive for the establishment of a
global presence in the power infrastructure market,

Growth in infrastructure demand in emerging nations

proposal of products and systems that fit a rapidly

Expansion of the energy-system market in response to upgradedelectric power infrastructure and increasing use of renewable energy

marketing of new products that support the use of EVs.

Among Japan's top-tier businesses with an impressive recordof achievementschanging energy market and development andLeveraging our business bases and technicalcapabilities as a comprehensive manufacturer of power
cables with an integrated development systemcovering all stages from raw materials to finished

Prominent technologies that enable creation of
new high-value added products

products, we aim to become a global supplier that●

Diverse product family with associated services relating to infrastructure
Extensive project-planning experience in the energy-system field

products and systems.

●

●

●

Environmental
Preservation●

offers a whole range of environmental and energy

Human Resources

New business opportunities for eco-friendly vehicles and related
infrastructure as market continues to embrace high-efficiency transport
Our Strengths●

response to the widespread use of EVｓ.
Supply Chain

State of the Market

Comprehensive strength as a corporate group with powerful affiliatecompanies in the heavy electrical machinery and engineering fields
End-to-end development capabilities from raw material to finished product

CSR Report 201816

Industrial Materials

Cutting tools

Sintered parts

Prestressed steels◆ VISION 2022 Mid-term Management Plan:

Segment Strategy

Ideal Future State

Become a leading global supplier of high-performance,high-functionality products by leveraging
world-class materials and process technology.

Ratio of thebusiness unit
in the total sales

10.9％
343,126(million yen)

Ratio of thebusiness unit in thenumber of employees

Growth Strategy●●

Strengthening Proposal Capability for Customers
Pitch our products with a full understanding of customer
needs to emphasize differentiation from our competitors.

●

5.7％

Innovation and Enhancement of Core Technologies
Deepen our advanced high-efficiency lines and develop
new products in preparation for vehicle electrification.

Accelerating Overseas Businesses
Maintain consistency of quality regardless of region andprovide services in a context that is sensitive to local issues.

(Note) The net sales in eachsegment include internalsales between segments.

14,558(persons)〈Growth Strategy〉
While it is expected that demand for lightweightmaterials will increase for EV development and that
medical and aircraft markets will grow, we predict anintensification of competition for procurement ofcobalt and other raw materials.
Sumitomo Electric will make use of the manufacturing

State of the Market●

Increasing demand for lightweight materials for EV development●

Growth in the medical and aviation industries●

Further intensification of the global competition●

Intensified competition for cobalt procurement to meetincreasing demand for battery applications
Our Strengths●

Excellent materials development capabilities• Strong differentiation from competitors through the application of
our unique materials and recycling technologies●

Manufacturing capabilities• Production and product-evaluation technologies for sophisticationand efficiency improvement of the production lines of our customers●

Global supply system• Support for the globalization of our customers’business

17 CSR Report 2018

capabilities that we have cultivated, including thematerial development, recycling, production andproduct-evaluation technologies, for sophisticationand efficiency improvement of the production lines ofour clients and will enhance its global business systemwith an aim to become a leading global supplier ofhigh-performance, high-functionality products byleveraging world-class materials and process
technology.

Number of Patents Year by YearR&D cost by business segment(Number of patents)
18,000Industrial Materials

Infocommunications

14,00012,000160

10,00015,954 15,601

6,824

7,030

7,067

7,611

7,449

6,225

7,064

7,621

8,014

8,343

8,152

2012

2013

2014

2015

2016

2017 (Fiscal year)

6,000¥117.7

4,000
2,000

billionin total

183

15,081
13,888 14,651

6,651

8,000

FY201733

12,876

Business Outline

Electronics

16,00083

Environment &EnergyBasis for Management

R&D Group

0718
Automotive●●●

In Japan

GovernanceIn other countries

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.

VISION 2022 Mid-term Management Plan:

widespread use of renewable energy and integration of them,

we will further enhance our wide-ranging core technologies

provide new opportunities for growth, we will promoteby combining them with advanced analysis techniques, AI,innovations based on a wide range of technologies owned by

IoT and computational science and work to strengthen thethe Sumitomo Electric Group for timely commercialization.

competitiveness in each business segment.

Furthermore, looking at future society, we will make efforts toWith recognition that drastic changes in the automobile

develop innovative technologies that are expected to bringsociety, such as increasing use of EVs, autonomous driving

major social reforms such as carbon electric wire, hydrogenand car sharing, revolution in the energy field as a result ofenergy and innovative materials.

Automotive

Multimaterials

Batteryrelatedparts

Highstrength
sinteredparts

Magnesium
alloysOverheadtransmission
lines

CentralGW

SiC power
devicesEVcharging

Hydrogentechnology

Traffic
info
service

EnergymanagementNew
technology
for system
maintenance

High-speed
network

Environment&
EnergyCableconnecting
parts

Ultrahighvoltage
cablesSuperconductivity

Challenge to
Advanced Technology

Opticalfiber

Fine-pitch
FPC

Opticaldevices

Electronic
devices

Highdensity
opticalwiringCommunications

Enhancement ofCore Technology
Lifescience

Human Resources

Electronics

EnergyPowertransmission/storage

Automotive
wireless
devicesNew-function
sensor/deviceInnovation
Anticipating ChangeHighvoltageDCcontrol

Supply Chain

Industrial
Materials

Nextgeneration
harness

New toolmaterials

Quality

Carbonelectricwire

Social Contribution

Water
treatment

Motor
parts

MobilityCore
Category

With a focus on Mobility, Energy and Communications fields,

Group's CSR Activities

Research and Development for the Next Generation

Infocommunications

Environmental
Preservation
CSR Report 201818

Global Business Expansion
The Sumitomo Electric Group is developing businessactivities on a global scale, with 395 consolidated
companies and over 250,000 employees around theworld.
While providing superior products and services, we
respect the cultures and customs of the countries andregions in which we operate. As a corporate entity weconduct business in harmony with society, so as tocontribute to the sustainable development of theeconomy and society.

History of the business development
on a global scale
Sumitomo Electric started to export electric wires, which
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 byexporting full turnkey projects, which covered exports ofelectric wire products and all services from design toconstruction. This leads to the establishment of foundations
for the social and economic development of developing
countries and regions all over the world.

With respect to products in the business segments as well,Company Name

Sumitomo Electric Industries, Ltd.

we have promoted localization of the business by setting up a

Established

April 1897

for overseas operation and so on. Through these activities, weIncorporated

December 1920

President

Osamu Inoue

number of production bases in the trend of customer demand
have provided technical guidance and have established an
integrated system of production and sales outside Japan.

Capital Stock

99,737 million yen (as of March 31, 2018)

Full turnkey projects

Head Oﬃce

4-5-33, Kitahama, Chuo-ku, Osaka, JAPAN

Since our first project in Venezuela in 1963, we haveundertaken construction works in Asia, Middle East, Africa
and South America to lay power transmission lines, which
serve as an“artery”that conveys electricity throughout

Net Sales by Region (Consolidated)society, and to build communication networks, which serve

Europe and others 3,601

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

Total forFiscal 2017

Asia 9,602

Japan 12,434

30,822

unprecedentedly large communication network construction
project, even by worldwide standards, to be placed with asingle company. A total of 300 Japanese staff and 2,000(100 million yen)

locals worked together on the project for 11 and a half years
until its completion in 1988.

America 5,185

In the two power transmission line construction projects forwhich we received orders in Iran in 1975 and 1977, we faced
not only harsh geographical and weather conditions in the

Number of consolidated companies by region
EUROPE

construction area but also unstable political circumstances

JAPAN

North/South America

Japan

USA

27

Still, we managed to connect

Argentina

1

Canadacountry and eventually2

Paraguay

1

12

Brazil7

1

Mexico

10

109

UK

7

Italy

2

Ukraine1

Asia

Netherlands

3

India

Spain

1

Indonesia

Slovakia

2

Cambodia

Serbia1

Singapore4

Czech Republic 1

Thailand

23

7

Germany

12

Philippines

11

Oceania &Middle East & Africa

Turkey4Vietnam

10

Egypt

2

Hungary

3

Malaysia

5

Australia

3

France5South Korea

7

Saudi Arabia 1

Bulgaria

1

China

75

Tunisia3

Belgium

1

Hong Kong

5

Morocco4

Poland4

Taiwan6South Africa

2Mordova

1

Romania

3

Russia5

19 CSR Report 2018such as revolution and war.

major industrial bases of thecomplete the projects in 1987.

EUROPE57

Basis for Management

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

bases, we are committed to job creation and humanthe establishment of overseas bases in consideration ofoperation. We now have a total of 280 overseas affiliates

manufacturing base in Thailand in 1969, we have promoted
market characteristics and needs for each business segment.

In the parts of the world in which we have established our(Persons)

250,000

84.0

83.8

83.3

300,000

225,484

240,798

240,865

84.5

84.2

85
84

248,33083

255,13382
81
80

150,000
100,000

187,769

201,906

202,328

209,094

215,496(100 million yen)

30,00025,68825,00058.3

55.2

35,00020,00028,228

Ratio of overseas sales (%)

59.5
29,331

59.7

58.8

60

30,82228,14550

18,38816,46817,461

16,537

11,518

11,76011,87011,60812,434

2013

2014

2015

2016

2017

14,17015,00040

10,00050,000
0

Sales in Japan and overseas andratio of overseas sales by year

Governance

200,000

with more than 200,000 employees.

Business Outline

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

resource development while aiming to stabilize the local

5,000

37,71538,89220132014

Ｉn Japan

39,236

39,637

2015

2016

2017

0
(Fiscal year)

Overseas

Ratio of Overseas

Ｉn Japan(Fiscal year)

Ratio of Overseas

Group's CSR Activities

Overseas38,537※Sumitomo Electric and consolidated subsidiaries※Sumitomo Electric and consolidated subsidiaries

Number of Group Employees in the World by Year
2008

2009

2010

2011

2012

2013

2014

Americas15,744

13,852

15,164

19,712

24,27329,470

2015

2016

2017

Male

Female

Total

Male

Female

Total

Male

FemaleTotal

34,82818,061

15,43933,50022,481

15,47837,95920,381

18,542

38,923

33,834

41,23047,73547,64454,24556,477

21,41334,86056,273

22,13534,662

56,79724,09736,44060,537

34,792

34,31037,53843,00049,86856,40858,27820,032

41,816

61,84821,44044,404

65,84425,00946,52071,529China

33,80837,84351,887

46,78847,39047,64652,323

20,76029,94750,707

20,19628,29848,494

19,716

24,79144,507

Japan

35,53637,36436,95437,49937,14837,71538,892

31,371

7,166

38,537

31,915

7,321

39,23632,201

7,436

39,637

Total

152,547 157,203 182,773 194,734 206,323 225,484 240,798 111,637 129,228 240,865 118,167 130,163 248,330 121,404 133,729 255,133

Ratio ofoverseas employees

76.7%

76.2%

79.8%

80.7%

82.0%

83.3%

83.8%

84.0%

84.2%

84.5%

※Sumitomo Electric and consolidated subsidiaries

395

JAPAN

Asia

in total

Breakdown ofcompanies consolidated

Supply Chain

166

109

QualityCompanies
Consolidated(as of March 31, 2018)●

Consolidated subsidiaries (358)
Equity-method aﬃliates (37)●North/SouthAmerica

Global Network
CSR Report 2018

Environmental
Preservation

15

48

Human Resources

Oceania &Middle East
& Africa

Social Contribution

32,667Core
Category

Europe/Africa
Southeast Asia

20

2017
Highlights

Major events during ﬁscal 2017 are listed below.

2017
April
●
●

Celebrated our 120th anniversary
Introduced new personnel systems including the system to take a leaveto accompany his/her spouse who is assigned overseas andthe expansion of the teleworking system

June●

Started the sales of the walking monitoring system "Q'z TAG™ walk"

July
●

●
●

Launched "Kenkatsu!" activities, which encourage
employees to maintain and improve their healthParticipated in the FY2017 Virtual Power Plant Project
ENERGYMATE™-Factory＊ incorporating Sumitomo Electric's sEMSA™ received
the Minister of the Environment Award at the 56th Product Contest in JECA Fair 2017

＊ENERGYMATE™-Factory is a system that Nissin Electric Co., Ltd. has developed.

August●In collaboration with Nippon Telegraph and Telephone Corporation and others,
demonstrated the world's largest transmission capacity ofthe standard-diameter optical fibers

September●●

Launched the mass production of high-quality SiC
epitaxial substrate "EpiEra™"
In collaboration with KDDI Research Inc. and others,
sucｃeeded in ultra-high-capacity optical fiber transmission
experiment with a capacity of 10-petabits/second/fiber,
which is substantially exceeding the previous world record

High-quality SiC epitaxial substrate "EpiEra™"

October●●

Increased the capacity to produce water treatment
membrane modules to respond to the sharp rise in
the demand in China and other countries
Updated the web pages concerning the response to
substances of concern under the upcoming RoHS 2
Directive in the electronic wire products
Water treatment membrane modules

21 CSR Report 2018

November
Basis for Management●

Tohoku Sumiden Precision Co., Ltd.
went into full-scale operation

Business Outline

2018

Tohoku Sumiden Precision Co., Ltd.

January

Launched the sales of string monitoring solution that can be retrofitted toexisting utility-scale solar power plants

Governance●February●

Group's CSR Activities●

Donated our ｓpaced aerial cable for demonstration testwith Mandalay Electricity Supply Corporation in Myanmar
Won an Excellence Award in the Environmental Reporting
Category of the 21st Environmental Communication Awards

March

Developed PLC string monitoring unit
for 1,500 V DC solar power plants
in Japan and abroad

Core
Category●

May

Electric power collected fromwind turbines via the 33-kV
underground distribution lines

North Project substation

Tsugaru City,
Aomori PrefectureSouth Project
substation
Connection
switchyard

154-kV undergroundpower transmission line
(approx. 34 km)

Supply Chain

Grid connection
substation

Developed a simplified POREFLON™
membrane bio reactor (MBR) device thatcan be attached externally forlivestock wastewater treatment,in collaboration with Institute of Livestock
Industry's Environmental Technology

Human Resources●

Received an order for powertransmission andtransformation equipment
and its installation work forWind Farm Tsugaru,
Japan's largest wind farm

33-kV underground distribution line

Quality●

154-kV underground power transmission line

Social Contribution

PLC string monitoring unit for 1,500 V DC plants

CSR Report 2018

Environmental
Preservation

Simpliﬁed POREFLON™ MBR device that can be attached externally22

Corporate Governance
Basic Approachwith various specialized knowledge and multifaceted views so

Under our corporate philosophy of the Sumitomo Spirit and theBoard of Corporate Auditors, which aims to reinforce 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 corporatethat outside corporate auditors occupy the majority of themonitoring system for the purpose of ensuring lawful andproper management.

The Board of Directors andthe Business Execution Systemgovernance, as well as to draw up and implement a growth《 Functions and Operations of the Board of Directors 》

word being“innovation.”We will be committed to further

corporate auditors serves functions to make decisions on andfollowing basic ideas:

Sumitomo Electric deliberates only important issues among(1) We will develop an environment in which shareholders can
exercise their rights appropriately.

on the medium-term business plan, annual plans based on it andstrategy fully utilizing our management resources, with the key

While the board of directors of a company with a board ofenhancing our corporate governance in accordance with thesupervise business execution, the Board of Directors of(2) We will take the interests of shareholders and otherstakeholders into consideration, and will appropriately
cooperate with them.
(3) We will disclose corporate information appropriately andensure transparency.
(4) We will emphasize the board of directors’functions tomake 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 corporate auditors and adopting a
supervisory system under which independent outside

corporate auditors and full-time corporate auditors workwith our internal audit department and accounting auditors
to ensure the lawful and proper management.

individual subjects, such as major investment items, and focusesquarterly 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 corporate auditors are also provided with opportunities
to present their opinions actively. As to supervising function of
the Board of Directors, while we respect opinions of the

independent outside directors and other independent outside

officers to ensure the independence and objectiveness, we have
set up the Nominating Advisory Committee and theCompensation Advisory Committee, which are both chaired byan independent outside director and made up of a majority of
independent outside officers, to enhance the effectiveness. The

Committees give advice when the Board of Directors appoints
candidates for directors and corporate auditors and makes adecision on the compensations of directors.

Sumitomo Electric holds monthly meetings of the Board of

Directors as well as extraordinary meetings when necessary. In
the meetings, which are chaired by Chairman, the Board of
Directors deliberates and takes decisions on the matters(5) In order to contribute to sustainable growth and increase

mentioned above, makes decisions on the basic policy of thein constructive dialogue with shareholders to a reasonable

operation of the system. There are currently 13 Directors in thecorporate value over the mid-to-long term, we will engage

internal control system and supervises the development andextent.

Company, who are comprised of 10 Executive Directors andWe 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.

three outside Directors not involved in business execution, andone of them is a female outside Director. For fiscal 2017, 13
Directors (excluding two outside Directors) received 917
million yen in total.

《 Effectiveness Analysis and Assessment of the Board of Directors 》

Outline of the Structure
Sumitomo Electric has employed the system with the board ofcorporate auditors in consideration of the contribution of

corporate auditors and the Board of Corporate Auditors toensuring sound business management. The Board of Directors,
the business execution system, corporate auditors and theBoard of Corporate Auditors are committed to fulfillment of

The Board of Directors started to analyze and evaluate its
effectiveness and disclose a summary of the results in fiscal
2015. As an initiative for fiscal 2017, it conducted aquestionnaire survey of all directors and corporate auditors

including outside officers in March 2018 and made discussions
based on the results at a Board of Directors meeting held in
May of th e same ye ar. Th e re su lts o f th e an alysis andassessment and future initiatives are summarized below:

their respective duties in order to achieve sustainable growth① Operation of the Board of Directors

based on the basic philosophy.

through our past efforts including narrowing down of theexternal perspective with the aims of further strengthening therevising the criteria for selecting the important matters,

the transparency and objectiveness of the businesstime for meetings in accordance with the content of theand medium- and long-term increases in the corporate value

The findings showed that the operation has been improved

In addition, three outside directors are appointed to adopt anmatters to be discussed at the Board of Directors meetings by

supervising functions of the Board of Directors and enhancing

improvement of the handouts for discussions and setting of the

management. We also select three outside corporate auditors

subjects to be discussed. In the future, we will continue to

23 CSR Report 2018Web

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

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

hearings with the directors, Internal Auditing Department andand enhancing the information to be provided in advance toauthorization documents and visit major establishments todiscussions in which the key points can be understood easily
outside officers.

② Structure of the Board of Directors

The findings showed that the increase in outside directors andto make more active and multifaceted discussions and that thestructure and other aspects of the Board of Directors are

generally appropriate in terms of the number of members andthe overall balance of their knowledge and experience. In the

future, we will continue to examine the ideal state of the Boardof Directors in terms of structure and other aspects tocontribute to the sustainable growth of Sumitomo Electric and③ 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

conduct audits. Corporate auditors also receive reports fromother auditors regarding their audit status, and exchange
information with the accounting 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 corporate auditors and accounting
auditors on an as-needed basis in the audits.

The accounting audits and internal control audits to be

conducted by accounting auditors are outsourced to KPMG
AZSA LLC.

Governancemid- to long-term improvement of the corporate value.

other employees regarding their duties, inspect important

Ensuring Appropriateness ofFinancial Reporting
We have established the Financial Reporting Internal Control

reporting and reporting on the progress of the improvement ofpromote control in the Corporate Staff Group. Under theirenhancement of risk analysis and monitoring on important

proper operation of the internal control system in each division

directors to share information and other issues.

Exchange Act, as well as the assessment, audit criteria andimportant matters and at the time of quarterly performance

Committee, chaired by the President, and an organization to

the internal control system. In the future, we will strive for thepolicy, guidance and support, we promote development andmatters, the expansion of opportunities for outside and internal

and affiliate in accordance with the Financial Instruments andSumitomo Electric is effective in general at present. We willcontinue to strive for the improvement of the Board ofenforcement 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. Basedon the results of such assessment, the department is required

system and establish a flexible system that can respond to

Financial Services Agency and obtain the approval of the

adopted the Executive Officer System and the Business Unitof Directors.

To clarify authority and responsibility in the business execution

to compile an internal control report to be submitted to thechanges in the business environment, Sumitomo Electric

Financial Reporting Internal Control Committee and the Board

System. Authority to execute business operations has beentransferred to Business Units while their responsibility has beenclarified, and to establish an internal check function, our

Sumitomo Electric Group's corporate governance structure

the Business Units including the Corporate Staff Group,

responsible personnel for the execution and appropriate

General Meeting of Shareholders
Appointments / dismissals

business procedures.

Board ofDirectors

Auditors, as mentioned above, the majority of the corporate
auditors are independent outside corporate auditors with

Audit

Chairman of
the Board of
Directors

Management
Conference

President

Accounting
Audit

Board ofCorporate
Auditors
Corporate
Auditors

opauditors, along with full-time corporate auditors and dedicatedstaff to corporate auditors, are in charge of monitoring inaccounting auditors to ensure lawful and proper corporate
management.

R&D Unit

Aﬃliates in Japanand Overseas

Production UnitsAﬃliates in Japanand Overseas

Five corporate auditors, consisting of two full-time auditors andCross-Sectional
Risk Management
Activity etc.

constitute the auditing system to audit the business execution

Risk Management Committee

three outside corporate auditors including a female one,plans and policies, in accordance with which each corporate

auditor fulfills his role, as assigned by the Board of Corporate

Auditors. Specifically, corporate auditors attend important

meetings including those of the Board of Directors, conduct

Corporate
Staﬀ Group

at

Audit

e

Internal
Auditing
Department

Compliance Committee

Environmental
Preservationof directors. The Board of Corporate Auditors establishes auditer

Human Resources

cooperation with the Internal Auditing Department andSales UnitsAﬃliates in Japanand Overseas

Cooperate

Covarious specialized knowledge and multifaceted views. These

Accounting
Auditors

Cooperate

Supply Chain

Auditing and Supervision Systems
As to the corporate auditors and the Board of Corporate

Quality

corporate regulations specify the scope of authority of each ofSocial Contribution《 Business Execution System 》

CoreCategory

Directors to further enhance its effectiveness.

Group's CSR Activities

activities including active discussions in deliberation on

Thus, we have confirmed that the Board of Directors ofBusiness Outline

other structural changes have enabled the Board of Directors

Basis for Management

improve the operation by preparing concise handouts for

Corporate Environment Committee
Information Management Committee
CSR Committee

CSR Report 201824

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, probability of occurrence
and other 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《 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.

Maintenance of favorable relations with stakeholders
such as customers, suppliers, shareholders/investors,
local communities and employees

Initiatives for Business Continuity

Continuous compliance with laws and corporate ethics《 Promotion of Business Continuity Management (BCM) 》

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

25 CSR Report 2018

Aﬃliates

Risk manager

Risk manager

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 further enhance the effectiveness of BCPs, weorganize a table top exercise in which interested persons fromrelevant divisions gather to check the BCPs of specific units andaffiliates. This exercise is conducted twice a year to reinforce
our business continuity capabilities.

《 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.

No. ofNo. ofsessions participants

Main content

Staﬀ in chargeof classiﬁcation

18

141

Tasks on how to classify
goods and technologies

Export control
sections

34

1,143

Export control practiceGeneral employees〈e-learning〉

―

2,776

Outline of export control
and internal rules

Domestic aﬃliates

284

Outline of export control

Overseasaﬃliates

6272

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

Intellectual Property Protection

Supply Chain
Human Resources
Environmental
Preservation

CSR Report 2018

Quality

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 (10 courses in a year) andpublish in-house newsletters such as "IP news" and"Standardization activity news." We also hold an Intellectual
Property Right and Standardization Convention every year as acompany-wide event to commend outstanding IP activities.

Social Contribution

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 theimplementation of information security training.
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
attached to emails, training to respond to targeted attack
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 in specific divisions as well as the investigation anddetection of any illicit acts using log information of servers andnetwork devices and implemented it on a trial basis.
With respect to the structure, the newly established SEI-CSIRT(Computer Security Incident Response Team) is now playing acentral role in our efforts to promptly identify and respond to
any incidents relating to information security in our Group
companies.

Target of
the training

Core
Category《 Strengthening of Information Security Measures 》

Record of Various Training Sessions in FY 2017

Group's CSR Activities

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
and other standards relating to the protection and use of
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 otherproblems. In addition, we revised the aforementioned policy
and rules in May 2017 in response to the full implementationof the amended Act on the Protection of Personal Information.
Also we have newly developed EU Residents Personal Data
Protection Rules in response to the enforcement of the EU
General Data Protection Regulation (GDPR) in May 2018 toproperly protect the personal data of EU residents as specified
by GDPR. Contract procedures to smoothly share personal
data of EU 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 dataof EU residents to the supervising agency in the EU.

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 for security 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.

Governance《 Protection of Personal Information 》

Security Trade Control

Business Outline

The Sumitomo Electric Group improves the information
management system and revised rules and enhance themechanism to prevent information leakage in each of its
divisions and affiliates. Regarding the use of social media, wehave 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 fordisseminating the rules.

Basis for Management

Protection of Personal Information,and Information Security

26

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.

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:
Director in charge of accounting
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《 Compliance & Risk Management Office 》

Compliance & Risk Management Office is in charge ofplanning and coordination of overall compliance activities in
the Sumitomo Electric Group and planning andimplementation of activities to comply with competition laws
and prevent bribery, and also operates the whistle-blowing

Sales Units and Automotive Business Unit respectively havean internal organization dedicated to compliance (Sales
Compliance Office and Automotive Compliance Office).

《 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

Sections in charge

The Sumitomo Spirit

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

Finance Department

Political contributions and donations

Administration Division

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

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

Safety & Environment
Department
Quality Management Division

Relevant laws, energy saving andsafety assessment associated with capital investments

Plant & Production
Systems Engineering Division

Customs

Procurement Division, Logistics
Management Department

Subsidy

R&D Planning &Administration Division

Elimination of antisocial forces
Construction business and electric business

Administration Division

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

Subcontract Act＊
Prevention of improper trading (purchasing)

Procurement DivisionInternal control

Internal Auditing
Department

Indication of origin

Compliance &Risk Management Oﬃce,
Legal Department

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.

Compliance Activities in Fiscal 2017
《 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 conduct

Glossary ＊Subcontract Proceeds Act

27 CSR Report 2018

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

approval of the Board of Directors in April 2018. The Code of
Conduct is basic rules on compliance commonly applied to
all Group companies across theworld. In addition to legal
compliance, it specifies the basic

Number of Consultations at the Contacts of the Group-wide System
FY

In-house contacts

External contacts

2015

6

45

Total
51

2016

11

54

65

2017

24

50

74

prevention of bribery, protectionof confidential information andintellectual property, respect for

Priority Mattershuman rights, environmental《 Compliance with Competition Laws 》

conservation and other issues.
Versions in different languages(Japanese, English, Chinese, etc.)《 Compliance Education 》

To check compliance risks, ensure implementation of
preventive measures and develop and enhance awareness ofcompliance, the Compliance Committee organizes regulartraining seminars for all officers and managers every year.

Group's CSR Activities

New employees and newly promoted personnel are also

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.

Governance

Code of Conduct

Business Outline※Note that consultations were also requested at contacts established individuallyby Group companies in addition to the consultations above.

policy on fair competition,

are posted on our website.

Basis for Managementbusiness with integrity, based on the Sumitomo Spirit with theprovided with position-based training seminars. The regulartraining seminars for managers are held from April to July
concerning such subjects

Number of Employees Who Took Competition Law Compliance Training(Including Online Training)as prevention of illicit acts,

FY

Number of attendants

compliance2014

approx. 4,400

99%

2015

approx. 4,700

95%

2016

approx. 5,000

91%

with

competition laws andprevention of bribery, andSpeak-Up System asmentioned below.

《 Prevention of Bribery 》
Compliance training

Target of the training

Number of attendants (period)40（Dec. 2017）

Newly promoted personnel

approx. 640 (Feb. - Mar. 2018)

New employees of Sumitomo Electric

approx. 250 (Apr. 2017)Managers of Sumitomo Electric andits subsidiaries in Japan

approx. 6,000 (Apr. - Jul. 2017)《 Speak-Up System 》

The Sumitomo Electric Group established the Speak-Up
at an early stage and resolve them by ourselves in a prompt
and proper manner. Specifically, we set up contacts forreporting and consultation by employees, business partners
and other parties not only in the Company but also outside it
by appointing a law firm and a specialized call center firm,
and the issues reported through this system are addressedand prevent recurrence where necessary. The contacts for
consultation and reporting have been established to allow
any employees of Group companies in Japan and overseas orother interested persons to access (overseas contacts were
established in 2014). We present the outline of the system atdisseminate it through monthly in-house magazines, Code of
Conduct, our website, correspondenses to business partners
and other measures.

In response to recent scandals of data falsification andimproper inspection, the Sumitomo Electric Group strives toenhance compliance on quality through initiatives including
emergency survey of divisions of Sumitomo Electric and its
Group companies on business rules and operation system for
quality and inspection procedures, clarification ofcompany-wide rules to prevent quality data falsification,
improvement of relevant training and strengthening of theaudits (see "Quality Compliance" in P43 for details).

CSR Report 2018

Environmental
Preservation

the time of various internal training sessions and also work to《 Compliance on Quality 》

Human Resources

with immediate investigation to take action to correct them

Supply Chain

System as a system to identify any compliance-related issues

QualityOﬃcers (including executive oﬃcers)

Social Contribution

Targets of the Training and Number of Attendants (Period)

The Sumitomo Electric Group introduced an anti-bribery
program in April 2013 to enhance its anti-bribery compliancesystem and has developed it on a global scale. In response to
the recent tightening of anti-bribery regulations on domestic
and foreign public officials in the US, Europe and emerging
markets, this program has established anti-bribery rules,
including prohibition against bribery, prior approval andex-post report on gifts, hospitality and donations, andrequested each division to appoint a bribery prevention
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 of Group
companies, who are in charge of operation of the program, andprovided them with detailed training. We will keep working tomaintain and enhance the global bribery prevention systemthrough continuous education, improvement of the program andits manual as well as collection and dissemination of relevant
information.

Core
Category

we also disseminate theAttendance rate28

Respect for Human Rights
Basic Approach to Respect for Human Rights
In adherence with the Universal Declaration of Human Rights,

Examples of human rights training and enlightenment programs in 2017●

Harassment prevention training for all employees
Human rights training for oﬃcers, new employees andnewly promoted employees in each position

which stipulates that“All human beings are born free and●committed to respecting and promoting human rights in all of●

Section-based human rights training at worksites in each base●Development of human rights training promotion leadersequal in dignity and rights,”the Sumitomo Electric Group is
the communities in which it operates.

(The HR Division and managers/supervisors at worksites attended
the Buraku Liberation and Human Rights Leadership Course.)

More specifically, the Sumitomo Electric Group Charter ofCorporate Behavior, which was instituted based on the

Sumitomo Spirit and the Sumitomo Electric Group Corporate●

Organization of an in-house contest for human rights slogans(received 4,242 slogans in 2017)

Principles in September 2005, specifies respect for humanrights, professional development and establishment of safe
and sound workplaces.

While constantly responding to increasing social demand as
to human rights and other changes in the environment, theSumitomo Electric Group takes a wide range of measures asa corporation to solve various human right issues, and strives

Human rights leader development course(Itami Works)

with enthusiasm.

《 Establishment of Consultation Services 》

to create lively workplaces where each employee can work

Sumitomo Electric Group Code of Conduct

Lecture meeting on human rights(Itami Works)

We have set up two consultation services regarding humanrights. One is supervised by the Compliance Committee and(established in April 2018)

intended to support employees with focus on laws andSumitomo Electric Group Code of Conduct, which clarifies
the acts to be conducted by all officers and employees in
all Group companies, clearly states the following rules onhuman rights along with specific examples:

Resources（HR) Division and deals with various kinds of●●●Commitment to respect for human rights, opposition tochild and slave labor
Prohibition of discrimination and harassment
Encouragement of contractors and suppliers to respecthuman rights

Commitment to Respect for
Human Rights among Employees

regulations in general. Another is managed by the Human
harassment 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.

Commitment to Respect for Human Rights
in the Supply Chain
We also pay attention to human rights widely in the supply chain
in addition to the working environment for employees.

We set respect for human rights as a basic value standard
and work to disseminate it in workplaces throughcontinuous enlightenment activities and other initiatives.

《 Sumitomo Electric Group CSR Procurement Guidelines 》《 Sumitomo Electric Group Global Human Resource
Management (HRM) Policy 》"Respect to Human Rights and Considerations of(established in September 2011 and revised in January 2017)

While the Sumitomo Electric Group has traditionallyconducted its business with a focus on human resources in(established in August 2010, revised in April 2014)

For the supply chain of our Group, we have specified rules on
Occupational Health and Safety" in the Sumitomo ElectricGroup CSR Procurement Guidelines. Suppliers of our Groupare asked to follow them at the time of procurement.

accordance with the Sumitomo Spirit, we establishedExcerpt from CSR Procurement Guidelines

Management Policy (Global HRM Policy) to clarify our basic

７．Respect to Human Rights and Considerations ofOccupational Health and Safety

Sumitomo Electric Group Global Human Resource

policy on human resources. This policy specifies the Group's

commitment to the provision of various career opportunities
regardless of race, ethnicity, national origin, religion, age,gender, gender identity, sexual orientation or disability,

promotion of diversity and other related initiatives. We havedeclared the policy to inform people in and outside of theGroup about it.

※See P49 for the text of the Global HRM Policy.

《 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 2017, a total of 13,539 persons participated in the humanrights-related seminars, including the education provided

mainly by Human Rights Task Committee members at theirworksites.

29 CSR Report 2018

Suppliers are requested to respect fundamental human rights of all
individuals and endeavor to make their workplace safe, sound andenergetic.
The use of forced labor or child labor, inhumane treatment or
discrimination of workers or illegal employment of foreign workers is
not allowed. The employment conditions including wage and work
environment as well as occupational health and safety standard must
be compliant with laws and regulations in the countries and regions
where suppliers are doing business.

《 Cooperation with Human Rights Organizations and Governments 》
Sumitomo Electric participates in human rights organizations
including the Corporate Federation for Dowa and Human Rights
Issue, Osaka. In cooperation with relevant governmental
agencies and other organizations, we work toward therealization of a society in which human rights are guaranteed
for all.

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 395 companies
located in approx. 40 countries all over theworld (as of March 31, 2018).

Shareholders
andInvestors

The total number of our shareholders is approx. 57,000,
and the number of shares issued and outstanding isabout 800 million. By type of shareholders, ﬁnancial
institutions and foreign holders own 40.0% and 39.8% of
the shares respectively, followed by Japaneseindividuals and others (12.9%) (as of March 31, 2018).

Suppliers

The Partners' Meeting held in ﬁscal 2017
gathered approx. 96 of our main suppliers.
(FY2017)

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
●

●
●

●

●

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
●
●
●

●
●

●

●

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●

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

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

●

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

71

84

79

61

50

2015

2016

2017

Press release

2015

2016

Interview

45

2017

2015

30
2016

22
2017

President's blog

(Fiscalyear)

CSR Report 2018

Environmental
Preservation

0

105

85

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. Meanwhile,
we totally renewed the conventional newsletter "SEI WORLD"
and started to publish "id" in July 2017. This new newsletter
introduces the efforts of our Group to tackle social issues
from various angles.
In our activities to send information via our websites, we kept
them updated by adding new information and enhancing theircontent. For example, we produced and posted a video on
our history to celebrate our 120th anniversary. In December
2017, we also set up a website to support the Lake Biwa
Mainichi Marathon, for which Sumitomo Electric has been a
special sponsor since 2013.
In January 2015, in an effort to enhance awareness of ourbrand, we launched a visual identity (VI) project, which aims
to give consistency to designs, logos, colors and fonts used
for company communications throughout the Sumitomo
Electric Group and establish a common impression andworldview. Since the launch, we have made continuous efforts
to disseminate the VI concept by applying it to various
publications and promotional materials.

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.
255,000 employees consisting of approx.
40,000 employees in Japan and approx.
215,000 employees in other countries.
More than 80% of the Group employees thus
work outside Japan (as of March 31, 2018).

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.

30

CSR Management"Glorious" represents the far-reaching qualitative goal. Thisphrase indicates that we become a company that does not
only achieve numerical targets for sales and proﬁts but also
constantly meets social demand and continues to exist.
This spirit is clearly reﬂected in the CSR activities of theSumitomo Electric Group. We promote the activities in theﬁve CSR priority themes of quality, supply chain, humanresources, environmental preservation and social
contribution, which are comprehensively covered in oureﬀorts to seek "SEQCDD" according to the priority order.
The ﬁrst priority is safety, followed by the environment andthen quality. Those factors are also expected to be applied

We will sincerely respond tothe continuously changing social
demand based on the unshakable
Sumitomo Spirit
Yoshitomo Kasui

Senior Managing Director andChairperson of the CSR Committee

to the supply chain in addition to our company and we will
endeavor to enhance CSR procurement in the future.
As a theme in the category of human resources, it isnecessary to promote diversity in consideration of local
features and wide-ranging characteristics of employees in
response to the globalization of our business. When we makea social contribution through business, we will handle it inconsideration of the time and space axes without doing
something extraordinary. As to the issues not directly related

Demand from society to companies changes over time.

to our business, we will continue to make social contributions

Companies would not be able to survive if they fail tothrough the CSR Foundation.

respond to such changes in social needs.

Although it is a diﬃcult challenge to establish CSR

We at the Sumitomo Electric Group have responded to suchmanagement covering the entire group including listed

needs of times based on the Sumitomo Spirit, which is our

subsidiaries as well as overseas subsidiaries andbasic philosophy we have inherited since our foundation.

sub-subsidiaries, we will continue to sincerely deal with it and"Mutual Prosperity, Respect for the Public Good" -- thismake steady eﬀorts by trying what we can do ﬁrst. Also forunchanging basic philosophy is also consistent with Glorious

the SDGs, which have been recently adopted by more

Excellent Company, which is our ideal state in the future. The

companies, we will seek reliable solutions through theword "Excellent" symbolizes the quantitative aspect while

process to achieve SEQCDD.

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 response to the formulation of our new mid-term
management plan "VISION 2022" in ﬁscal 2018, we revisedsome 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.

31 CSR Report 2018

New
5 CSR Core
Categories

Basis for Management

New CSR Core Categories, New Priority Themes and Main Targets
We aim to further increase our net sales by 20% from the

management plan "VISION 2022," we revised the CSR corecurrent level to 3.6 trillion yen under VISION 2022. It iscategories and priority themes as presented below and also

actually challenging to set and declare quantitative CSR

set new main targets including new key performancetargets amidst accelerating market changes. Still, with theindicators (KPIs) for fiscal 2022.

recognition that CSR activities underlie our efforts to meet the

While we set a target of reducing global greenhouse gas

targets for VISION 2022 and are essential to become aemissions by 5% from the fiscal 2012 level as a KPI for

Glorious Excellent Company, the ideal state of our Group, we

VISION 2017, we failed to meet the target with a reduction

will enhance our efforts to meet the targets.

Business Outline

In line with the announcement of our new mid-termof 2.3% due to the situation where our sales grew byapproximately 20% over the past five years.

Core categories

Priority themes

Main related SDGs＊

Main targets (including KPIs for ﬁscal 2022)

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 diversity
and occupational safety

Environmental
preservation

Prevention of
global warming

Socialcontribution

CSV＊ activities andsocial contribution
activities

Promotion of measures to appoint anddevelop Group Global Executives

Group's CSR Activities

Human
resources

Governance

Quality

Achieve zero serious accidents and reduce thenumber of accidents by half from the FY2017 level
Achieve no increase in CO2 emissions fromthe FY2017 level

Core
Category

Maintain and expand the projects that
help solve social problems※Improvement rate in the number of complaints from ﬁscal 2017 (results in FY2017 = 100)

Sumitomo Electric Group CSR Promotion System
In July 2004, Sumitomo Electric established the CSR Committee, whichadministration and comprised by the managers of the departments incharge of CSR-related areas. Under the system shown in the figure
below, the Committee conducts its activities as a cross-sectionalorganization to promote CSR initiatives in the Sumitomo Electric Group.

2. Promoting internal and external information
disclosure and public hearings on CSR.
3. Promoting CSR education programs throughout the
Sumitomo Electric Group, etc.

The roles of the CSR Committee include:

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.

Five core categories

Information
disclosure

Public Relations
Dept.
IR Oﬃce,
Accounting Div.

Environmental
Preservation

SocialContribution

Human Resources Div.

Social Infrastructure Sales & Marketing Unit/
Electronics Sales Unit

Procurement
Div.

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

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

Public hearing function

Employees

Glossary ＊CSV: Creating Shared Value

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

Human Resources

Target and achievement report

Safety &Environment Dept.
Logistics
Management Dept.

Administration
Div.

Environmental
Preservation

Promotion and education ofbusiness philosophy and visions

Supply Chain

Quality

Support and guidance

Sumitomo Electric Group companies

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

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

Enhance the activities of
the SEI Group CSR Foundation＊SDGs: Sustainable Development Goals
See P35 for details.

CSR Report 201832

Targets and Actual Results in Fiscal 2017 / Targets for Fiscal 2018
In the Sumitomo Electric Group, the departments in charge of the CSR core categories respectively set various annual targets inaddition to the main targets mentioned in P32, 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 2017 and targets for fiscal 2018 on the main initiatives incore 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 2017
Reduce complaints by 9% fromthe previous ﬁscal year

Quality

Continue to promote Own Process
Quality Assurance Activities (eighthyear)① Strengthening of quality
initiatives in the design process② Company-wide development of
the“3 points control of quality”(improvement of the activities)③ Expansion of activities
performed on practical themes

Supply chain④ Continuance of activities forcompany-wide dissemination (throughthe issuance of booklets and holdingof exchange meetings about Own
Process Quality Assurance Activities)

Request suppliers in Japan andoverseas to take actions based on
the CSR Procurement Guidelines,
and promote the implementationof the CSR procurement
questionnaire survey●●●

Human resources●

Continue to implement thetraining program that supports
compliance
Extend the application ofcommon basic rules on
procurement to overseas
aﬃliates

Realization of the Global HRM
Policy① Continuance of promotion of
the talent management cycle② Continuance of eﬀorts toclearly deﬁne the HR rules tobe commonly applied on a
global scale in writing
Develop global activities of the
HR Division① Dispatch of trainees from the
HR Division② Continuance of HR manager
meetings of overseas Group
companies③ Use of English as thelanguage at the monthly HR
Centers Meetings

Results in FY 2017
Decreased by 6.1% from the previous
ﬁscal year

Evalu
ation

Page

△

43

② Started model activities aimed atquantitative improvement○④ Held 2 exchange meetings and added
9 examples to the booklets tointroduce good practices●●

Conducted a CSR procurement
self-evaluation questionnaire survey targeting
about 850 suppliers in Japan and overseas
Interviewed 86 suppliers in Japan andasked them to make improvement

Reduce the index for the number ofcomplaints by 21% from the previous
ﬁscal year
Continue to promote Own Process
Quality Assurance Activities (ninth year)① Disseminated the cause investigation
results of design-related complaints
and checked for similar risks③ Conducted a total of 276 activities onpractical themes in a year

Targets for FY 201842
43

① Company-wide development ofimportant measures to prevent
complaints② Company-wide development of the“3 points control of quality”(development of procedures topromote quantitative improvement)③ Expansion of the results of theactivities on practical themes④ Continuance of activities forcompany-wide dissemination (throughthe issuance of booklets, holding of
exchange meetings and other initiatives)
●

○

46
●

●

●

Compliance training: Provided to 1,786
persons in Production Group andCorporate Staﬀ Group. Provided new
training that simulates the process toadvance to commercialization for 33
persons in R&D Group

●

○

47

《Develop global activities of the HR Division》① Dispatched an HR staﬀ member from
Headquarters (HQ) as an overseas
trainee as we did last year
② Held a Global HR Conference that HR
managers of overseas groupcompanies attended from October 23
to 25 as planned③ Conducted an HR Center Conferencein Japan and a monthly HR Center
conference call using English
language●●●

33 CSR Report 2018

Continuous implementation ofcommunication measures ineach establishment andexamination of company-widemeasures
Launch of "Kenkatsu!" activities toassist employees in maintaining andimproving their health “Kenkatsu!”(
isa coined term meaning activities
seeking health)
Discussion of action guidelines
for ﬁscal 2018 and thereafter

●

●

●

●

●

Extend the application of the
procurement guidelines to overseas
aﬃliates

48《Realization of the Global HRM Policy》① Conducted Business Unit (B.U.) HR
Meetings. Drafted a global standard
for the workﬂow of "position
management and human resource
management" to implement a global
HR database② Documented and issued the common
Global HR standards and guidelines
on 8 topics (as planned)●

Continue to implement the training
program that supports compliance

Basic rules (procurement guidelines):
Inspected 17 overseas aﬃliates andgave instructions●○② Continuance of eﬀorts to clearlydeﬁne the HR rules to be commonly
applied on a global scale in writing

49

Prepare for the implementation of the HR
rules to be commonly applied on a global
scale in writing. Consider adding new
standards to the issued documents andreleasing new documents

50③ Further activation of Regional
Executive Conferences and Area
Committee activities
Based on the operation policy, allocate
budget for these activities and provide
support from the related divisions anddepartments in Sumitomo Electric. Work todevelop the next generation of SEG Global
Executives through the relevant activities

Set targets on work style reforms foreach division and conducted initiatives.
Achieved the targets on total working
hours and paid holidays mentioned on
the left

Conducted stress check and follow-up
activities including training andinterviews based on the results
Subsidized health promotion activities(cafeteria points for the cost of a sports
gym and fee for participation in a
sports convention)
Examined a roadmap for work stylereforms toward VISION 2022

Develop global activities of the HR
Division① Dispatch of trainees from the HR
Division
Dispatch HR staﬀ member from HQ as we
did last year

Introduced a system of paid holidays
that can be taken by the hour
Used the results of the Survey toCreate a Lively Working Environment,
as well as comments from town
meetings, for the examination of HR
measures

Realization of the Global HRM Policy① Continuance of promotion of thetalent management cycle
Continue conducting B.U. HR Meetings andstart using the Global HR Database(SuccessFactors) to further improve thetalent management cycle to identify anddevelop the next generation of Sumitomo
Electric Group (SEG) Global Executives●

Develop the SWiTCH 17 Campaign(ﬁnal year)● Strengthening of initiatives withfocus on the review of working
styles. Aim to reduce total
working hours to 1,900 to 2,000
hours in a year and encourage
each employee to take 15 paid
holidays on average in a year

Request suppliers in Japan andoverseas to take actions based on the
CSR Procurement Guidelines, andpromote the implementation of the
CSR procurement questionnaire survey② Compliance with the standards inthe global HR document "SEG
Common Languages"

53
○

54
55

Observation of the rules that requirepreparation of important documents
published by the HR Division in multiple
languages and use of interpreters in
HR-related meetings (when the attendees
cannot communicate in a common
language.)③ Continuance of Global HR
Conferences in JapanTo be held on October 22 and 23 at the
Osaka HQ

Related SDGs

Targets for FY 2017●

Promote the establishment of
the following priority safety
activities① Activities to prevent serious
accidents② "Safety! Power OFF Activity"③ Activities for ensuring safetyin multi-worker operations④ Prevention of recurrence ofsimilar accidents involving
injuryRe-establish safety culture① Promotion of S-T-O-P
Accident Campaign＊ andelimination of unsafe actions② Identiﬁcation of weaknesses
to share them on acompany-wide scale andsetting of the "state that thecompany aims to be"●

Serious accidents: 0
Accidents resulting in remaining
disabilities: 1
Accidents resulting in lost work time,
no lost work time accidents andaccidents causing minor injury: 42(including accidents resulting inremaining disabilities)▼

Targets for FY 201860

Reduce serious accidents and accidents
resulting in remaining disabilities to zero,and reduce the total number ofaccidents resulting in lost work time, nolost work time accidents and accidents
causing minor injury to 38 or lessAccident score: 216 or less

《Promotion of the establishment of thepriority safety activities》●●

Implement priority items for ﬁscal 2018●

In ﬁscal 2017, developed activities on
the items ① to ③ mainly through self
inspection in each division or basewith "viewpoint of workers" and"standardization + education work" as
the key points (activities on ④ were
performed by each division)
The number of each of the target
tasks was determined as follows andthe countermeasures are currently inprogress:① Serious Accident Prevention: 5,666② Power OFF: 3,045③ Safety for multi-worker operation:
1,641

Related SDGs

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●① Activities to prevent serious
accidents② Safety! Power OFF activity③ Hearing of problems by top
management

○

59

●

Group's CSR Activities

Human resources

●

●

Page

Governance

Implement priority items for ﬁscal
2017 (measures to be taken
continuously)

●

Evalu
ation

Business Outline

Reduce serious accidents andaccidents resulting in remaining
disabilities to zero, and reduce
the total number of accidents
resulting in lost work time, no lostwork time accidents andaccidents causing minor injury to
24 or less

Results in FY 2017

Activities to be conducted
continuously① 1-2-3 activities② S-T-O-P accident campaign③ 3-pillar safety management④ Thorough training for unskilledworkers《Re-establish safety culture》① Promoted S-T-O-P Accident
Campaign through enlightenment
with posters and other tools②-1．Identiﬁed weakness of theSumitomo Electric Group with asafety awareness survey●-2．Designed a draft improvement
plan (the state that the company
should aim to be) at an
improvement review meetingGroup-wide structural reinforcement
activities
Emergency / priority safety management
activities
Safety education
Plant disaster prevention
Global safety diagnosis
Group-wide sharing of best practices●

Core
Category●●●

Social Contribution●

Conduct environmental audits
In Japan: Continue legal
compliance audits
Overseas: Conduct legal
compliance audits(China, ASEAN and the
US)

In Japan: Conducted at 9 sites
Overseas: Conducted at 3 site (China,
Vietnam and the US)

650 persons participated in managerial
post-based training

Implement the following fundprojects

Implement the following fund projects③ Supply of scholarships: 42.1
million yen

●

●

○

○

63
64

③ Supply of scholarships: 40.5 million
yen

●

●

Held a market of specialties from the
Tohoku region at the Tokyo HeadOﬃce to support its reconstruction
from the Great East Japan Earthquake
Participated in the TABLE FOR TWO
program and donated 20 yen from thesale of each low-calorie meal

Continue the practical training, in which
simulated diagnosis is conducted using
the actual products based on“hiyari”
or near-miss reports and past audits

Implement the following fund projects① Monetary contributions to university
courses: 113 million yen○② Subsidies for academic and research
programs: 30 million yen

39③ Supply of scholarships: 43.7 million
yen
●

●

Implementation of environmental
auditsIn Japan: Legal compliance audits
Overseas: Legal compliance audits(China, ASEAN, the US)

63① Monetary contributions to university
courses: 93 million yen② Subsidies for academic and research
programs: 30.6 million yen

Achievement of the targets in all itemsof the Action ECO-22V campaign▽

Promote partnership and cooperation
with nonproﬁt organizations (NPOs) for
the support the reconstruction of the
Tohoku Region and other initiatives

39

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)

Environmental
Preservation

Promote partnership andcooperation with nonproﬁtorganizations (NPOs) for the
support the reconstruction of the
Tohoku Region and otherinitiatives

62

Human Resources② Subsidies for academic andresearch programs: 30 million
yen

●

▼

Supply Chain

Continue the practical training, inwhich simulated diagnosis isconducted using the actual
products based on“hiyari”ornear-miss reports and past audits① Monetary contributions touniversity courses: 93 million yen

Social contribution

Out of the 14 items, Performanceachieved the targets: 11 items,
Performance failed to achieve thetargets: 3 items

Quality

Environmental preservation

Achieve the targets in all items in
the Action ECO-21 (Phase Ⅵ)
campaign

Basis for Management

Core
Category

Glossary ＊S-T-O-P Accident Campaign

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

CSR Report 201834

■

CSR Core Category

SocialContribution■

CSR Priority ThemeCSV Activities and Social Contribution Activities

CSV Activities
Basic Approach

responsibility, the Sumitomo Electric Group added "CSV

We will be committed to the creation of shared value(CSV) and activities that support the growth of
local communities through business activities

contribution," one of the CSR core categories that were

The business activities of the Sumitomo Electric Group arevery wide-ranging in terms of technology, market andbusiness, involving various stakeholders. We recognize thatsocial contribution of our Group is not limited to donations
and philanthropy but also includes the supply of usefulproducts, technologies and services to society throughbusiness activities to create shared value based on our CSR
basic policy. At the same time, We are determined tocontribute to a "better society and environment" throughproactive and aggressive commitment to solving social
challenges while always being conscious of our role as amember of society.

Re-definition of Priority Themes
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 wellas national governments and NGOs, can assist in solving the
problems has been developed and many companies are now
engaged in the activities.
To meet such social demand and fulfill our corporate social

What are the SDGs?
The Sustainable Development Goals (SDGs) are
17 goals and 169 targets presented by the UN
along with long-term development guidelines forthe period from 2015 to 2030. They include
specific initiatives to solve all types of social
challenges, including those in developing
countries such as poverty and health andhygiene, as well as global warming and otherenvironmental problems, improvement ofworking conditions and consideration of diversity.

35 CSR Report 2018

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

Relevance to the SDGs
The picture on the right page illustrates the values offered by
the Sumitomo Electric Group for the development of asociety that is projected around the year 2030 in our
mid-term management plan 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.

Basis for Management

3 Forms of the Ideal Society We Seek and 9 Fields for Our Initiatives
Forms of the ideal society we seek

9 Fields for our initiatives
Encouraging useof renewableenergy with smart
energy systems

Promoting recycling
technologies
and pursuing materials
development lessdependent
on scarce resources,
driving resource-friendly
practices

A SafeandSecure Society

Safer and more secure society realized
through the development ofcommunication systems that support
automatic driving, improvement of
infrastructure durability and practical useof sophisticated security technology

Car-to-car andcar-to-roadconnectivity for asafer
driverless society

Creating a secureurban
environment withenhanced
infrastructure
durability

Increasing
telecommunications
security for safety
and privacy

A Comfortable
andViable Society

More comfortable society with higher
potential for growth realized through thedevelopment of new technologies to transmit
large volumes of information at higher speeds
and the establishment of new systems thatconnect cars with society, people and cities

Achieving faster datatransmission throughadvancedinfocommunication
technologies
underpinningan IoT-based society

Providing technologythat connects
automobiles
to society, liberatingtransportation andincreasing comfort

Developing solutions
that connect cars,
houses,people, andcommunities,
enabling eﬀectiveenergy-sharing

Governance

Development of
eco-friendly productsthat limit CO2
emissions

Business Outline

A Green Society

More enviroment-friendly society realizedwith products and services that facilitate
the reduction of CO2 emissions,widespread use of renewable energy andreplacement and recycling of rare
resources

Group's CSR Activities

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

Core
Category
Social Contribution
Quality

Encouraging useof renewable
Promoting recycling technologies
energy with smart
and pursuing materials
energy systems
development less dependent

Car-to-car andCreating a secure urban
car-to-road
environment withconnectivity for a safer
enhanced
driverless society
infrastructure durability

Increasing
telecommunications
security for safety
and privacy

an IoT-based society

Human Resourceson scarce resources,
driving resource-friendly
practices

Developing solutions
that connect cars, houses,

Providing technology people, and communities,
that connects automobiles
Achieving faster data
enabling effective
transmission through advanced to society, liberatingenergy-sharing
transportation andinfocommunication
increasing
comforttechnologies underpinning

Supply Chain

Development of
eco-friendly productsthat limit CO2
emissions

Environmental
Preservation
CSR Report 201836

Main Business Groups That Support CSV Activities
Since its foundation as a manufacturer of copper wires and cables, Sumitomo Electric Group has continuously
grown through the development of related materials and manufacturing technologies and celebrated its 120th
anniversary in 2017. Based on the Sumitomo Spirit, we will continue to create a large number of technologies andproducts 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

37 CSR Report 2018

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 201838

Social Contribution Activities
Basic Policies on Social Contributions
Sumitomo Electric stipulated the Sumitomo Electric Group
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“respectfor human resources,”“attaching importance to technology,”and“creating a better society and environment”in accordance with theSumitomo Spirit and the Sumitomo Electric Group Corporate
Principles, as well as widely contributing to society through its
business activities, including the provision of products, technologies
and services that beneﬁt society.
● Globally promote eﬀorts toward the development of humanresources, the promotion of research and learning andenvironmental conservation.

● Promote community-oriented social contribution activities in theGroup's business locations all over the world.

● Provide

continuous support to employees' voluntary social
contributions.

Under the Basic Policies, we are committed to the social
contribution activities suitable for the Sumitomo ElectricG r o u p , w h i c h i s a i m i n g t o b e a“ G l o r i o u s E x c e l l e n t
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.

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“Basic glycobiological research for elucidating the pathologicalmechanism and its clinical application" at Hokkaido University●“Laboratory for Water, Food and Health Risk in Asia”atYamagata University●“Development of new cancer biomarkers that allow early
diagnosis of liver metastasis”at Kobe University (new)●●“Microbial dark matter resource use and biochemicalengineering”at the University of Tsukuba (new)For the program to support academic and research activities,
we received 166 applications. Out of them, we have selected
28 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※.

Social Contribution through Donations
We are making social contribution through donations
from a global perspective
In fiscal 2017, 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, WWF Japan. In addition, we provided
financial assistance for the relocation of Osaka Suita House,
which are accommodations for the families of critically ill
children hospitalized in the National Cerebral andCardiovascular Center. We thus developed a wide range ofsocial contribution activities.

Amount of Donations by Category (Sumitomo Electric alone)
The SEI Group CSR Foundation

156,000,000 yen

Other103,941,630 yen

Total

259,941,630 yen

In fiscal 2017, the SEI Group CSR Foundation received
contributions of a little over 156,590 thousand yen in total

Other 4,657,576 yen

Environmental conservation
1,000,000 yen

from Sumitomo Electric (with the whole amount, including alittle over 590 thousand yen donated through the cafeteria

Local development
12,612,000 yen

plan, appropriated for operation) and (1) donated 93 million
yen in total to university courses, (2) supplied subsidies of 40.5

Sports, arts andculture25,510,000 yen

million yen in total to academic and research activities, and (3)provided scholarships of approximately 30.6 million yen in total
for 35 Japanese students and 18 foreign students learning in

103,941,630
yenIndustrial and academic
development, researchand development
28,736,000 yen
Welfare projects
7,063,704 yen
Schools and education
24,362,350 yen

Japan and 110 local students studying at overseas universities.
In the program to make donations to university courses, we
provided monetary support for two new courses along with thesix 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●“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●

39 CSR Report 2018

Web

Amount of Donations by Year(thousand yen)

1,000,000
800,000

809,526 749,738

600,000
400,000
200,000

500,000

500,000

2012

2013

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

0

2014

2015

2016

2017 (Fiscal year)

Accumulated endowment in the SEI Group CSR Foundation(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.

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

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

Glossary ＊Matching gift system

The company concurrently donates anamount equal to the donation madeby an employee in this system.

Based on the principle of“Harmony with the International Community”set forth in the Sumitomo Electric Group Charterof Corporate Behavior, the Sumitomo Electric Group, which has presence in more than 40 countries and regions aroundthe world, aims to contribute to development of local economy and society while respecting the culture and customsof every region and country. To this end, along with social contribution through business activities, we are committed tovarious activities to support local communities and build harmonious relations with them.

Basis for Management

Contributions
to LocalCommunities

Activities in Japan

Business Outline

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 776,260,000 yen.
※The amount is calculated based on the criteria mentioned in Attachment 2 "Examples of conversion intomonetary value concerning the giving access to facilities and participation and dispatch of personnel" of
the Survey on Corporate Philanthropic Activities in Fiscal 2017 by Keidanren (Japan Business Federation).

Promoting community support activities andexchange with local communities

Local cleaning
activities＊1● Local cleaning activities, promotion of greening, environmental conservation activities, etc.

Inspection tour for local children in
the Inari Festival＊2
Governance

Sumiden Fine Conductors Co., Ltd.: Monthly cleanup of public roads andside ditches around the facilities＊1 and other initiatives
Cleanup activities are performed in 34 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.
●● Opening corporate facilities (sports grounds, gyms, etc.) to the publicGroup's CSR Activities

Sumitomo (SEI) Electronic Wire, Inc.: Opening gyms and tennis courts tolocal residents and other initiatives
Performed in 12 of the 54 companies including the company mentioned above.
●● Inviting local residents and students (from elementary, junior high and high schools) to plant tour

Jointly organized Shibazakura Festival ＊3

Osaka Works of Sumitomo Electric: Factory tour for local students in the Inari Festival heldin commemoration of its foundation in April＊2
Performed in 13 of the 54 companies including the company mentioned above.
●● Opening company sites to the public to organize eventsCore
Category

Hokkaido Sumiden Precision Co., Ltd. and Hokkaido Electric Industries Ltd.:
Jointly organized Shibazakura Festival in May to receive about 1,000 visitors＊3
Performed in 7 of the 54 companies including the companies mentioned above.
●● Publishing local community magazines

Athletic lessons for elementary andjunior high school students ＊4

Contributing to sports and cultural activities● Contributing to sports activities

Quality

Sumitomo Electric: Sponsoring the 73rd Lake Biwa Mainichi Marathon in March 2018
In Itami Works of Sumitomo Electric, organizing athletic practice sessions for elementary schooland junior high school students (a total of 18 sessions including those jointly organized with
Itami City received 2,395 participants in total)＊4
Performed in 11 of the 54 companies including the company mentioned above.

●● Contributing to arts and cultural activities

Sumitomo Electric Intellectual Property & Technology Center, Ltd.: Participation of employees
as staff of the secretariat of Giving Art to Museums (an organization working to donate
artworks to public museums; http://www.art-okuru.org) and other initiatives
Performed in 7 of the 54 companies including the company mentioned above.

Social Contribution

Osaka Works of Sumitomo Electric in July 2017 and January 2018,
Itami Works in May and December 2017 and Yokohama Works in May and November 2017

Work experience program forelementary school students ＊5●

Supply Chain

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

adults and other support

Tokai Sumiden Precision Co., Ltd.: Reciving local elementary school students fora work experience program in November＊5
Performed in 22 of the 54 companies including the company mentioned above.
●

Dispatch of lecturers toan elementary school for a science class＊6
Human Resources● 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＊6 and offering other support
Performed in 3 of the 54 companies including the companies mentioned above.
●

Activities in other countries
Sumitomo Electric Bordnetze GmbH: Donation of IT equipment and school supplies
to fourth-grade students of a local secondary school in Moldova in May＊7

Environmental
Preservation● Donations of money and goods to local schools and communities

Donation of school supplies and other goods in Moldova＊7

CSR Report 201840

■CSR Core Category

Quality■

CSR Priority Theme

Product Quality & Product Safety

We strive for the maintenance and improvement of product quality andthorough compliance for "Enhancement of Manufacturing Capabilities"
Scandals on quality data falsiﬁcation by Japanese companies occurred insuccession in 2017 and raised concerns about corporate compliance. This
reminded me that, along with the maintenance and improvement of productquality, thorough compliance with laws and rules is an absolute foundation
for the development of companies. The quality management staﬀ of theSumitomo Electric Group work not only to establish a mechanism thatprevents defective products but also to respond to illicit acts as well as risksof generating illicit acts.
In our commitment to VISION 2017, we promoted Own Process Quality
Assurance Activities, which sought to achieve zero defects on the design
and planning stage, and newly established the Sumitomo Electric Group
Quality Management Global Standards, which serve as the constitution for
quality in our Group and have been introduced on a global scale. In
addition, we have thoroughly provided quality education to all managers
involved in manufacturing.
While a target for VISION 2022 is "Enhancement of Manufacturing
Capabilities," quality management is positioned as an important componentof it. VISION 2022 sets a numerical target of reducing complaint incidenceby 30% from the ﬁscal 2017 level. By responding to each defect witheﬀective countermeasures to prevent its recurrence, we will work toenhance quality management.

Yoshinori Makio

General Manager, Quality Management Division

Product Quality & Product Safety
Basic Approachmake continuous efforts to develop and strengthen their own

As a corporate entity involved in manufacturing, thecustomers can use our products with a sense of security. A

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 Group41 CSR Report 2018

quality assurance systems based on the standards so thatcompany-wide quality improvement activity called the QR-1
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

We are introducing the Degree of Quality Assurance
Level-based assessment and implementing initiatives
to improve the degree at overseas sites
Since fiscal 2010, we have promoted Own Process Quality
Assurance Activities, which are comprehensive efforts toprevent defects in each process from being produced or
initiatives, 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.

Process

Process

Pass
no defect

Produceno defect

Good
products

Pass
no defect

Good
products

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”
Quality Management Education is developed throughout
the Group including overseas companies to cultivate
the culture of“quality first”
The Sumitomo Electric Group provides employees withtraining on quality control at the SEI University (see“Human
Resource Development”in P57 for details) to improve andensure the quality of products and services at higher levels. In
fiscal 2014, we started a new quality management training
course on a nomination base for managers in charge of
product development, design, manufacturing and quality
assurance, and have since worked to meet the target ofproviding the training to all managers who are required totake it. Eventually, by the end of fiscal 2017, the course wastaken by 1,141 persons, which represented 95% of the
managers who are required to take it in Japan.
We work to improve various domestic education programs,
such as position-based training for all employees,
nomination-based training in accordance with specialized

Shipment

Inspection

jobs and special issues and optional training to learn relevant

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 meetings

We 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 a
To prevent complaints from occurring, we should ensure thatprovided training sessions on Own Process Quality Assurance
Activities. In fiscal 2017, a total of 6,855 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 38,111. 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 organize exchanges of information on model cases, andthe 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

Human Resources

as an initiative to eliminate defects in processes. In thisof Quality Management Committee in China, as opportunities

Supply Chain

Produceno defect

Good
products

This system has enabled an objective assessment of quality

Qualityfurther stimulate the activities through training to develop

Quality Assurance to B or higher.

Social Contribution

process management at the mass production stage. In casecase, and efforts have to be made to improve the Degree ofCore
Category

passed down to the following process. As part of these

may be passed on to the customer if no action is taken in thisGroup'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

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

＊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 201842

Global Quality Management System Audits
We conducted audits of 99 Japanese bases and36 overseas bases by fiscal 2017

Customer Satisfaction Improvement
Activities by the Sales GroupWe systematically conduct Global Quality Management

We are committed to activities to understand the problems
of customers and make proposals to help solve themeach business unit in light of the Sumitomo Electric Group

Our Group's business activities consist mainly ofbusiness-to-business transactions, and we therefore believe

System Audits to evaluate the quality control initiatives of
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 99 sites in total in Japan. Our domestic facilities are

currently undergoing the fourth round of the audits, andprogress in improvement is seen as the audits are repeated.

The divisions that have proceeded with alignment with the

Quality Management Global Standards tend to receive fewer
complaints. The audits are repeated with the aim ofpromoting continuous improvement of the quality assurance

system. Overseas, the audits were conducted in a total of 36

sites in China and Southeast Asia through collaboration withdomestic units having the center function, in an effort tothat 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 give feedback based on surveys ofsuperiors and subordinates at an annual group training
session to encourage management staff to take the initiativein making changes and to ensure CS improvement.

through the global quality management system audits.

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.

Monozukuri Technology Improvement Activities

Outcomes of the Quality Management Activities

We promote manufacturing strengthening activities
based on Own Process Quality Assurance activities
and SEI's Just-In-Time approach

We will continue to make steady efforts toeliminate complaints

enhance awareness of 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

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

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.
However, there are still many issues to be improved. We willcontinue to make steady efforts to eliminate complaints withthe 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.
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

80

improvement and become a company with the highest

60

competitiveness in manufacturing.

40① 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 process

20② 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

43 CSR Report 2018

0

100

2012

84.3

2013

79.1

2014

89.5
72.5

2015

2016

68.1

2017

（Fiscal year）(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 today. Compliance with laws
and rules is an absolute foundation for companies to betrusted and respected by society and grow in a sustainable

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.

《 Clarification of Rules on the Prevention of Quality
Data Falsification and Improvement of the Education 》

We have established the Sumitomo Electric Group Quality

Management Global Standards as the basic rules on quality toManagement ofChemical Substances in Products
We are managing chemical substances properly inaccordance with our own guidelines based onJapanese Industrial Standards(JIS) guidelines
In pursuit of reducing environmental impact of the products offalsification and, improper inspection, we have formulated new

the Sumitomo Electric Group is committed to proper

incorporated them into the standards. In the meantime, while

we implement the“SEI Guidelines for the Management of

position-based training on compliance, we will also add a

specify the items to be carried out at each stage of thecurriculum to make all employees recognize the necessity andand quality assurance based on JIS Z7201“Management ofconsideration of the cases of other companies on data

the Group and our customers, as well as improving compliance,internal rules on the prevention of quality data falsification andmanagement of chemical substances in products. To this end,
Chemical Substances in Products”(note), which was established to

manufacturing process such as procurement, design, production

importance of quality compliance.

Chemical Substances in Products - Principles and Guidelines.”

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 Group
self-examination of their main operations every year. We will
add the prevention of quality data falsification to the inspection
items of the self-examination to ensure that quality data
falsification is eliminated each year.

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
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.

Product Safety (Product Liability)

Under the corporate principles of“offering the very best goods
creating a better society and environment, with a firm

awareness of our social responsibility,”the Sumitomo ElectricGroup 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 thoroughdesign stages.

Committee in place to enhancecoordination within the Group.

(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.

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,＊ and《 Training on Product Safety 》

is meeting customer demand for products that contain noprohibited substances. For example, we already discontinued

Act through cooperation between the Quality Management

the RoHS Directive from 2019 in our products by the end of

The seminars are based on the idea that the safety standards

use of these substances in the parts to be used in our products

predictable misuses. The content is designed to deepen the

At the same time, to comply with the REACH＊ regulation, we

the direct use of the four types of phthalates to be banned by

Division and the Legal Department.

fiscal 2017 in advance. We are also making efforts to avoid theestablished by companies should also take into account thethrough cooperation with suppliers.

trainees' understanding of the laws with reference to actual

are working for final registration of chemical substances one bysuch as the review of product safety at the development andarsenide (GaAs) in 2012 and tungsten carbide (WC) in 2017.

product safety, collection of product safety information andthe requirements of the REACH regulation including reportingcases, as well as to provide practical lessons on the issues

one as required and completed the registration of gallium

design stages, proper display of warning labels, maintenance ofWe are also making efforts to ensure appropriate responses to

response to accidents.

of the SVHC＊ contained in products.

《 Voluntary Inspection on Product Safety 》

As part of the product safety initiatives, we conduct voluntary

inspection of the check items applied to the whole Group once
Based on the inspection, necessary measures are discussed

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.

and implemented autonomously to strengthen the system topromote product safety measures.

certain 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.

＊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

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

To quickly respond to progressive tightening of regional

Human Resources

Product Liability Act and the revised Consumer Product Safety

Supply Chain

For product safety, we hold annual technical seminars on the

Qualityexamination of safety, especially at the development andhas the Chemical Management Task

Social Contribution

and services to satisfy customer needs”and“contributing to

The Sumitomo Electric Group alsoCore
Category

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

RoHS Directive
Glossary ＊RoHS stands for Restriction of the use ofGroup's CSR Activities

also has a mechanism where all divisions conduct

Governancecourse on the prevention of quality data falsification to the《 Strengthening of the Function to Check Quality Data Falsification 》

Business Outline

be followed by all divisions as mentioned above. In

our Group has already provided employees with

Basis for Management

manner. In this context, the Sumitomo Electric Group takes
the measures mentioned below for quality compliance.

＊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 201844

■CSR Core Category

Supply Chain■

CSR Priority Theme

Promotion of CSR Procurement

We will work to establish a healthy supply chain incooperation with suppliers
When we formulated the CSR Procurement Guidelines in 2010, we
experienced diﬃculties in disseminating them at ﬁrst because of insuﬃcientunderstanding of the signiﬁcance of CSR procurement even in thecompany. But CSR procurement has become a crucial indicator of thematurity of the supply chain.
Sumitomo Electric has been supported by many excellent suppliers in its
history of 120 years in Japan. I believe that the objective of CSR
procurement is to reconﬁrm the healthy trade relations with those
suppliers and establish a win-win relationship.
To this end, it is necessary for the entire group to work together toimplement initiatives. We are making continuous eﬀorts to cooperate with
suppliers by, for example, explaining the concept of CSR procurement
face-to-face even to small suppliers. It is key not to regard CSR
procurement as something special but to disseminate it as daily activities.
In line with the ongoing globalization, our supply chain keeps expanding
and becoming more complicated. We sometimes have talks with suppliers
that had few opportunities to engage in CSR procurement before. Also
covering those overseas sites, we would like to endeavor to continuously
promote CSR procurement.

Kazuo Okami

General Manager, 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 a“service 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

45 CSR Report 2018Web

※ 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

Future initiatives based on the activities from ﬁscal 2013 to ﬁscal 20172017Group Corporate Principles and Charter of Corporate
Behavior in August 2010. The guidelines were revised toinclude provisions concerning response to the issue of

conﬂict minerals＊ in ﬁscal 2014. To enhance promotion of

CSR procurement self-evaluation questionnaire surveyof approximately 850 suppliers in Japan and overseas● Interview with 86 suppliers to ask for improvement●●

2018 to2022●

Business Outline

Procurement Guidelines based on the Sumitomo Electric

Establishment and dissemination of
the CSR Procurement Guidelines● CSR procurement self-evaluation questionnaire
survey of a total of approximately 1,930 suppliers●

2013 to2016

To promote our commitment to CSR in the procurement
activities, we established the Sumitomo Electric Group CSR

Basis for Management

Commitment to CSR Procurement

Promotion of CSR procurement covering the suppliers that
represent 90% of the value of our domestic procurement
Gradual expansion to include major overseas suppliers

the guidelines, we also ask suppliers to take proper action by
specifying relevant requirements in the basic transaction
For the promotion of CSR procurement, in addition toactivities to disseminate the guidelines among suppliers, weneed to check the progress in the dissemination through aself-evaluation questionnaire survey of suppliers on CSR andCSR VOICE

Governanceagreement.

Connecting people and people, technology andtechnology, we will strongly contribute tosociety through our main businessalso promote improvement activities in full coordination with
suppliers.
Group's CSR Activities

As shown in the table on the right, we have gradually
expanded the scope of the questionnaire survey since its
start in ﬁscal 2013 to include Japanese and overseas
suppliers of the divisions and aﬃliates of Sumitomo Electric. In
ﬁscal 2017, approximately 850 companies in Japan andoverseas cooperated with the survey and we interviewed 86
of them concerning especially important items and asked
them to enhance compliance, information management andMr. Tsutomu Nishikawa, Manager of Osaka Branch
Mr. Ko Fujii, Head of Sales Section II

CSR procurement covering the suppliers that represent 90%of the value of our domestic procurement."

Sumitomo Electric GroupCSR Procurement Guidelines (extract)※
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
to request their suppliers to comply with the guidelines.

1. Provision of Useful and Safe Products and Services
2. Improvement of Technological Capabilities

3. Promotion of Sound Business Management
4. Contribution to Preservation of
the Global Environment

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

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.

＊ FA Systems

Factory Automation Systems

Web

Environmental
Preservation

8. Disclosure of Information and Promotion ofCommunication with Society

Human Resources

Since its foundation in 1926, Takebishi has dealt in electricand electronic devices for industrial use, mainly the
products of Mitsubishi Electric Corporation, as atechnological trading company primarily based in Kyoto
and Shiga prefectures. While the commitment of companies
to the SDGs attracts public attention, we have presented
solutions to social challenges in our mid-term vision"T-Link1000," which was announced in June 2018, including
the expansion of our medical business to address thehyper-aged society, as well as the expansion of ourenvironmental business for the post-carbon society. We
have also revealed our initiatives that are conscious of CSV.
It is our joy and mission to solve social challenges based on
our corporate philosophy of "Connecting people andpeople, technology and technology, with trust to create abright future." We believe that the diversification of ouractivities will give us business opportunities.
We are aware that CSR procurement is a foundation for
ensuring our healthy relations with the partner companies
that have established a win-win relationship with us. We
consider that, in addition to the exchanges in the CSR
procurement questionnaire survey, our abilities to"connect," which is our strength in business, will contributeto the entire society through procurement.
We started business with Sumitomo Electric in 1972 andprovided services such as the organization of training
sessions on FA systems＊ for overseas facilities and theintroduction of local suppliers. We now propose IoT and
AI-based total solutions to meet demand for the use ofrobots for automation as well as inspection andmeasurement. We would like to establish and maintain agood partnership with the Sumitomo Electric Group andwork to help solve social problems.

conventional activities, to meet the target of "Promotion of

Supply Chain

companies, in addition to further improvement of the

Quality

Takebishi Corporation

Social Contribution

From ﬁscal 2018, we will strive for coordination with GroupCore
Category

other relevant activities.

※ Please see the following page for the entire guidelines.

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

CSR Report 201846

Contribution to Preservation of
the Global Environment

re-collected and updated on a real-time basis, in cooperation

We are committed to green procurement as
an essential quality factor

store the products in the aﬀected area at the time of disaster.

To 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 tosuppliers that promote a certain level of environmental

conservation activities in order to encourage suppliers to
perform such activities.

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 thewith suppliers so that we can know the impact of disaster in ashort time and ﬁnd any sites where we can manufacture orIn ﬁscal 2017, we had fears of a supply shortfall due to Kyushu
deluge, troubles in the production lines at plants of chemical
manufacturers in Japan and other countries, suspension ofoperation caused by ﬁre and other reasons and cases on

quality data falsiﬁcation. In these situations, nevertheless, wewere able to procure materials without impact on our

production or that of our customers by, for example, using thealternative products that had been examined in theabove-mentioned activities, receiving supply preferentially withthe cooperation of our suppliers and promptly investigating the

products for which quality data were falsiﬁed. These incidents
reminded us of the signiﬁcance of such activities.

We will maintain these activities to strengthen our

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

Organization of Partners' Meetings
Ninety-six suppliers participated in Partners' Meetings
The Sumitomo Electric Group organizes Partners’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 Partners’Meeting, we also present the CSR

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

Partners' Meetings were also

held in some of the divisionsand Group companies inJapan, as well as someoverseas facilities, in order todisseminate CSR procurementon Group-wide and global
scales.

Partners' Meetings

use 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
activities. To minimize the impact of such suspension on our

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●

production and enable quick recovery, we have examined●with commodity items. We have also developed a●alternative suppliers and products, in addition to replacement
communication network, as well as a system where
information on production and logistics bases can be

47 CSR Report 2018

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 2017

to conﬁrm compliance with the rules as mentioned in the tablebelow.

Inspection results
In Japan: 3 division of Sumitomo Electric, 4 aﬃliates

Internal
Control

In Japan: 3 division of Sumitomo Electric, 4 aﬃliates
Overseas: 17 aﬃliates

Customs
Law

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

No. ofcourses

1st half of
FY2017

7

26

133※

21

2nd half of
FY2017

7

26

125※

25

Key personnel
development program

2nd half of
FY2017

1

4

10

7

Training for overseas
purchasing managers

2nd half of
FY20171

1

6

6

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

Environmental
Preservation

Organized in 3 regions● Attended by 33 persons● Themes: Subcontract Proceeds Act, internal control andprocurement for the commercialization of research outcomes

No. ofNo. ofNo. ofparticipants
lecturescompanies(total)

Date

●

●

R&D Group

Results of Education
Human Resources

Organized in 29 regions (video conference: 7
regions; delivery lecture: 22 regions)
Attended by 1,786 persons● Themes: Subcontract Proceeds Act, Customs Law andinternal control

Supply Chain

Production
Groupand Corporate
Staﬀ Group●

Quality

Results of training

Training program to develop key personnel
on the Subcontract Act

Social Contribution

While Procurement Compliance Training Seminars have beenorganized for Production Group and Corporate Staﬀ Groupevery year, we newly organized the seminars for R&D Group inﬁscal 2017.
The content of the training seminars for Production Group andCorporate Staﬀ Group was signiﬁcantly revised to further
enhance the understanding among the attendants. The
seminars were organized as delivery lectures and as training via
a video conference system, attended by many Group
employees as shown in the table below. To further enhance
the awareness of compliance related to the procurement ofmaterials within our Group, we will continue to organize
training seminars in a way that more Group employees canattend them.
Training seminars for R&D Group were launched to ensure that
researchers can not only learn the procedures to obtainnecessary materials and other items for R&D activities but alsoestablish a proper cooperative relationship with suppliers at
the time of the commercialization of R&D outcomes. The
results of the training are presented in the table below.

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 2017 was composed of sevencourses including“procurement-related laws and regulations,and CSR Procurement,”each of which was provided by anexpert in the Procurement Division. The experts used textbooks
they prepared, and gave lectures through teleconferences withsites in Japan and overseas. In total, 258 persons attended thelectures.
We continued to organize a training program to develop key
personnel on the Subcontract Proceeds Act in ﬁscal 2017, andprovided a certiﬁcate for 10 persons from seven aﬃliates whocompleted the program. This program develops core personnel
for the establishment of an autonomous system to comply withthe act in each division and company because the Subcontract
Proceeds Act has to be made known widely not only in thesections in charge of procurement but also in manufacturing
and development sections.
As a new initiative, we set up a training program for overseas
purchasing managers in ﬁscal 2017 with an aim to improve our
procurement capabilities on Group-wide and global scales
through the development of the core personnel. The training
provides 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 improvetheir skills and encourage them to share the learning with theprocurement staﬀ of
their companies. We
will gradually expand
the scope of the
program and also
improve the content
in the next ﬁscal year
and thereafter.

Group's CSR Activities

Education System

Procurement Compliance Training Seminar for
Production Group and Corporate Staﬀ Group

GovernanceIn 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 re late d to
procurement. The inspection of Sumitomo Electric anddomestic aﬃliates in Japan aimed to conﬁrm compliance with
the Subcontract Proceeds Act, the Customs Law and internal
control rules. For inspection on the Subcontract Proceeds Act
and internal control rules, we selected the target sites on theassumption of regular visits to them in the future. With respect
to the Customs Law, all of the sections importing directly fromoverseas were inspected to check the correctness of theamounts in custom reports, and we gave guidance on revisionsof the Customs Law and other laws.
In ﬁscal 2017, Hitachi Works received on-site investigation by
the Small and Medium Enterprise Agency of Japan concerningcompliance with the Subcontract Proceeds Act and otherissues, which was completed with no indication of particularly
major issues.
The Procurement Division will continue to expand and improvethe education and inspection activities to promote compliancewith laws related to procurement.

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 201848

■CSR Core Category

Human
Resources■

CSR Priority Theme

Promotion of Diversity and Occupational Safety

We will continue to actively invest in human resources,
which are a base of a company
During the ﬁve-year period of VISION 2017, we promoted diversity in an eﬀort to establish
the human resources base that serves as a pillar for the sustainable growth of theSumitomo Electric Group.
In particular, our eﬀorts to promote the use of global human resources have been achieving
signiﬁcant results. At present, 35 Sumitomo Electric Group (SEG) Global Executives organize
Area Committees, which are a cross-border initiative developed in four key areas of theworld (Americas, Europe, Southeast Asia/Australia and Greater China), promoting activities
to solve common challenges in the respective areas. We have also promoted women's
empowerment through steady eﬀorts including the active recruitment of female main career
track employees and the appointment of them as managers. In recognition of these eﬀorts,
Sumitomo Electric was selected as a Nadeshiko Brand, an organization that actively
promotes empowerment of women in the workforce, by the Ministry of Economy, Tradeand Industry of Japan and the Tokyo Stock Exchanges, in 2017. We have also invested inhealth promotion initiatives since the Health Management Declaration in 2015, such as
prevention of metabolic syndrome among employees, improvement of exercise habits andmental health measures, to develop a working environment where employees can work
vividly over a long period.
In the coming ﬁve-year period of VISION 2022, we will accelerate the establishment of acommon infrastructure for human resources and organizations on a global scale andcontinue to promote diversity management. In the meantime, the globalization of ourbusiness is also changing the awareness of human rights among the stakeholders. While ourGroup has conducted business management with respect for human rights based on the
Sumitomo Spirit and the Global Human Resource Management (HRM) Policy, we will also
consider the formulation of a clearer policy on human rights in response to such changes.
For occupational safety, we set equipment safety measures, develop human resources who
prioritize safety and establish a culture of safety as the three main pillars. With Safety &Environment Department playing the pivotal role, we will make eﬀorts to materialize theslogan of "Safety First."

Kazuo Oe

General Manager, 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.

recruitment and promotion. We have declared the policy toworking actively in about 40 countries around the world. We

Global Human Resource Management(HRM) Policy

believe that for Sumitomo Electric to win the global●

In the Sumitomo Electric Group, over 240,000 employees arecompetition and grow further, it is essential that we fully
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

49 CSR Report 2018●

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.

《 Encouragement of International Employees to Work in Japan 》

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

the next generation of SEG Global Executives, we will

resource development system that allows talented andqualiﬁed persons to seek career development beyond theWith the aims of providing SEG Global Executives with more
opportunities to demonstrate their abilities and cultivating
encourage international employees to work in Japan. We will
set up a program to have them work in Japan either as
expatriation or short-term assignment. We will also makeefforts to improve the supporting program for international
employees working in Japan.

management of Group companies in Japan and overseas or《 Development of a Global HR Database with an aim
to establish processes for development and promotion 》

perform even higher duties. We give board members andTo understand human resources of the Group on a global

equivalents from overseas subsidiaries, except for those ofscale in a seamless manner, as well as to provide various

listed companies, the global leader (GL) grade, and recognize

career opportunities to competent and enthusiastic staff andthem as SEG Global Executives. At present 35 persons, mostcultivate and promote them, we are establishing a global HRof whom are executives of overseas Group companies, arerecognized as the Global Executives. They are provided with a

database. Business Units also hold meetings with executives
to identify excellent staff and create development andactive roles as global leaders.

promotion plans.

Our Group companies conventionally formulated their own

to 1) enhance the presence of each business/base inmeasures. We recognized that it is necessary to standardize

the knowledge and experience of SEG Global Executives andamong our Group companies in Japan and overseas in order

up four committees of Americas, Europe, Southeast

based on the Global HRM Policy. In fiscal 2017, throughwide variety of subjects, such as human resourcecompanies, we started to issue "Global HR Document," which

the respective regions.

(mandatories) and guidelines (recommendations) on eachincorporate the proposals presented by the Area Committees

2017. In the future, we will make steady efforts to implement

conference, which is held in the four regions of Americas,

documents on new topics.

beyond the borders of individual companies. The system aims

human resources rules，established and operated different HR

consideration of the regional characteristics, 2) make use of

the HR measures and management processes to some extent3) establish a network of the Global Executives. We have set

to further proceed with Group-wide and global management

Asia/Australia and Greater China, which are committed to acollaboration on a global scale involving HR of overseas

development and strengthening of manufacturing abilities inclearly states our global HR philosophy (approach), standards

We also use the Overseas Top Executives’Conference toHR-related topic. We published eight key documents in fiscal

into the management of the Sumitomo Electric Group. In thisreleased documents at each Group company and also publish

Europe, Southeast Asia/Australia and Greater China, top

gather every year to discuss global management issues. We

Group Global Magazine“ALL SEI ”

will continue to make the conference more active to further
promote diversity management in the Sumitomo Electric

We are committed to the promotion ofcommunication within the Group

Group and coordination between affiliates.

Qualityexecutives of Sumitomo Electric and its overseas affiliates

Social Contribution

SEG Global Executives to participate in business management

Core
Category《 Establishment of a human resources infrastructure throughthe application of common human resources measures andprocesses to all Group companies in Japan and overseas 》
Group's CSR Activities《 Area Committee 》

We introduced the Area Committee system in 2015 to allow

Governanceborders of individual companies to engage in thewide range of career opportunities to help them play more

Business Outline

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

Basis for Management

Global Grade System andGroup Global Executive Personnel System

We deliver“ALL SEI,”a periodical commonly distributed
across the Group, as a communication tool for Group

Area Committees and Overseas Top Executives’Conference

SEG Global Executive Conference(Japanese, English, Chinese, German, Spanish and Thai) fourtimes a year.
This magazine conveys the Sumitomo Spirit and theSumitomo Electric Group Corporate Principles, as well as
information on our business and social contribution activities

SEG Executive
Conference of
the Americas(SEECA)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

We also started to provide

Activities by theme※

Activities by theme

Activities by theme

Activities by theme

the President of Sumitomo

Support from theresponsible departmentsof Sumitomo Electricin various regions, in order to share information and cultivate
a sense of unity among Group
employees.

Human Resources

articles on interviews between
Electric and SEG Global
Executives in fiscal 2016 topresent what we expect ofEnvironmental
Preservation※Activities on research, risk management, PR, humanresources/HR development, accounting, information system,
procurement, safety & environment and productionengineering. The themes for the activities are set for eachregion.

↑Supply Chain

Sumitomo Electric Board Members Meeting

employees both in Japan and overseas in six languages

Group employees and our
vision about them in a specificmanner.

ALL SEICSR Report 201850

Diversity in Recruitment

and production of buffer materials for packaging, Sumiden

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

conversion of drawings and other paper documents into

Friend has expanded its operations gradually to also engage inelectronic files and shredding and recycling of waste paper.

In ﬁscal 2017, Sumitomo Electric employed 184 new graduates for

We also established Yokohama Branch in 2013, Tokyo Branchoverseas students, etc. We also hired 99 mid-career employees.

respective areas. As of June 30, 2018, 87 employees are

set a target of increasing the percentage of "global" employees,

As a result, the overall employment rate of the physically oruniversities, to 10% or more and started to work to achieve thecompanies including Sumiden Friend, Ltd. (eight companies inmain career track in Japan, 46 of whom were female and 5 werein 2014 and Osaka Branch in 2015 to promote activities in the

As an initiative to promote the diversity of human resources, weworking at the company, including 54 persons with disabilities.

who indicate non-Japanese and graduates from overseas

mentally disabled for Sumitomo Electric and its qualified Grouptarget in our activities to hire new graduates for fiscal 2017.

total) was 2.29% in June 2018.

including those in new ﬁelds and global markets, as well as to

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

To support the development of our various business activities
promote women's empowerment, we continue to actively

recruit women, non-Japanese, students from foreign countries,
mid-career employees and other diverse personnel.

2011 2012 2013 2014 2015 2016 2017 2018
The disabled

12

12

20

28

33

39

45

regardless of nationality, race, gender, age or other backgroundin the Group, we will continuously offer various training

opportunities for human resource development and promote thedeployment and appointment of diverse personnel throughout
the Group to give them a wide range of career opportunities.

350
300

268
36

250
200
150

281

232

100
50

296

320

43

51

238

245

257

Female2.00

2.17 2.17

2.29

Legally required
percentage

0942009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (Year)(Note) Total for Sumitomo Electric and its qualiﬁed Group companies including Sumiden Friend, Ltd.

In our Group, Sumitomo Wiring Systems, Ltd., Sumitomo Riko

326

322

Co., Ltd. and Nissin Electric Co., Ltd. have also established their

2012

Male

2013

2014

2015

2016

2017

(Fiscal year)

Number of Employees Working for Sumitomo Electric
As of March 31 of each ﬁscal year
Who Were International Students(Persons)

70
60
50
40
30
10

1.91

2.11

2.21

special-purpose subsidiaries, which are SWS Smile Corporation,

020

2.01 2.02

2.05

1.8

420

59

63

2.2

1.9

381

400

Employment rate as ofJune 15 of each year

（％）
2.3

2.0

(Persons)

450

Employment Rate of the Physically or
Mentally Disabled by Year

2.1

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

54(Persons)

To ensure that diverse talents can demonstrate their capabilities

11

0

18

25

29

33 33 36

41

43 India
Vietnam
4 TaiwanKorea
4 Malaysia
Indonesia 3 USA
China

52 51
48

62

70

SumiRiko Joyful Company Limited and Nissin Heartful FriendCo., Ltd., respectively. An exchange meeting between thesesu bsid iarie s was h e ld twice in 2017 to facilitate t hei r
coordination.

For further promotion on a Group-wide scale in the future, weestablished a team to promote the employment of persons

with physical or mental disabilities within the Human Resources

Division of Sumitomo Electric in January 2018. We will develop
a system to create places where persons with disabilities can

3
2
2
1

Italy
CanadaSingapore
Sri Lanka

111
1Thailand
Nepal
Philippines
France1111work while feeling rewarded in many Group companies andworksites and to ensure that all Group companies can achieve
and maintain the legally required percentage and respond toenvironmental changes such as legal revisions.

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 (Fiscal year)(Note 1) Employees who have obtained Japanese nationality or permanent residency
are excluded.
(Note 2) Above graphs cover personnel data for Sumitomo Electric employees,
including those on loan to Sumitomo Electric aﬃliates and other organizations.

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
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 of
persons with disabilities in July 2008 (certified in February2009). Beginning with loan and maintenance of foliage plants

Glossary ＊Special-purpose subsidiary

51 CSR Report 2018

Women's Empowerment
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.

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.

■ Period

Ratio of Male/Female Employees andRatio of Male/Female Managers

2 years from April 1, 2016 to March 31, 2018

Sumitomo Electric employees (Note 1)■ Targets and results
Category

FemaleTargets

1,451

Result Achieved◯◯

Section managers or higher
Women's share in
1.7%
positions: 1.5% or more
Appoint
assistant managers
Assistant managers:
ment
10.3％
or higher positions
10% or more◯◯

persons

13.0％

4.0％

Women's share in
Appoint
assistant managers or
menthigher positions

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

persons

98.4％

Group employees in the world (Note 4)（Recruitment）

PR activities mainly targeting female students

Female133,729

Male

persons

52.4％

Total
number offull-time
employees

255,133

Improvement of capabilities to recruit women（Appointment）

Implementation of measures to support female employees
on main career track in their career development

Monitoring of promotion of women in each division

Realization of flexible work styles

47.6％

Female1,471
persons

Total
number of
section managers
or higherpositions(Note 3)

13,34311.0％
Male

11,872
persons89.0％(Note 1) Above graphs cover data for Sumitomo Electric employees,
including those on loan to Sumitomo Electric aﬃliates and other organizations.
(Note 2) Managers: assistant managers, section managers, division managers and management(Note 3) Section managers or higher positions: section managers,
division managers and management(Note 4) Sumitomo Electric and its consolidated subsidiaries《 Childbirth and Rearing Support Program 》
Number and share of women in
section managers or higher positions(Persons)

50

1.02

40
30

25

20

32

2013

1.45

38

40
28

10

2014

10

2015

46
30
10

2016

（％）
1.7
1.6
1.5
1.4
1.3
1.2
1.1
1.0

34

《 Support of Career Development 》

12
2017

(Fiscal year)

No. of section managers
No. of general managers or higher positions
Share in section managers or higher positions

Number and Share of Women in
Assistant Managers
120
100
80
60

7.1
62

7.8

71

73

2014

2015

9.1
88

40
20
0

2013

Number of assistant managers

2016

2017

(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.

CSR Report 2018

Environmental
Preservation

7.6

Human Resources(Persons)

as of January 16 ofeach ﬁscal year
（％）
10.3
11.0
10.0
9.0
106
8.0
7.0
6.0
5.0

In comparison with men, women are more susceptible to life
events and have fewer role models. Accordingly, women tend tohave difficulty in imagining their career path at present, which isalso due to the impact of monoculture in organizations. In 2016,
we launched a training program to develop female main career
track employees. This program gives lessons to the superiors offemale main career track employees to understand the necessity
and importance of developing female subordinates and consider
suitable support for the growth of each of them with recognitionof the existence of stereotypical views on female subordinates.
We also set up a training program to raise the awareness offemale employees on general track and their superiors in 2017,with an aim to release the potential of the female employees
and thereby further strengthen the workforce of the organization
as a whole. We will continue to improve diversity management
and strive to create workplaces where women and various otherhuman resources can work lively.

Supply Chain

8

0

1.40

22

17

10

1.68

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 is foundpregnant, one month before maternity leave, before return towork from childcare leave and two months after return to workfrom childcare leave, to help her return to work smoothly andwork actively after the return from childcare leave.

Quality1.28

as of January 16 ofeach ﬁscal year

Social Contribution

Establishment of a network of employees that responds
to diversity

personsCore
Category

Active development and appointment of competent andenthusiastic female employees on general track

121,404

Group's CSR Activities■ Initiatives

●

Male

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

1.6％

2,713

96.0％

Targets

persons(Note 3)

2,757

Male

persons

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

●

Female3,６４０Category

●

87.0％
44

(Note 2)■ Targets●

persons

Total
number of
section managers
or higherpositions

Total
number ofmanagers

3,790

2 years from April 1, 2018 to March 31, 2020

●

9,749

150

■ Period●Male

11,200Femalepersons● Establishment of the action plan for the 2nd phaseTotal
number of
employees

Business Outline

Women's share in
Clerical staﬀ: 40% or more 42.9％
Recruitthe new graduates
Technical staﬀ: 15% or more 15.4％
ment
for main career track●

As of March 31 of 2017

Basis for Management● Targets and results of the action plan for the 1st phase

52

Safe and Sound Workplace《 Evaluation by External Organizations 》●

Certification with "L-boshi"

We were certified as the top L-boshi company in August 2016.
L-boshi is certification granted by the Ministry of Health, Labourand Welfare of Japan to companies that are
outstanding in terms of encouraging women toplay more active roles based on the Act ofPromotion of Women's Participation andAdvancement in the Workplace.

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 2017, we held a forum attended by about 70 female

employees on general track from 11 Group companies. With

Work style reforms
We promote company-wide campaigns with the aim of
ensuring that employees can achieve the properbalance between work and life
To win the global competition in the future, it is important tocreate a workplace that allows diverse staff to work
comfortably. Sumitomo Electric launched a company-wide
three-year campaign called SWITCH Campaign in 2008 to
conduct various initiatives including the promotion of work
styles that balance work and life and the review of theoperations of each division to improve the efficiency. Since
then, while changing the name to SWITCH Plus Campaign
and then SWiTCH 17 Campaign, we have worked for various
themes centering on the initial activities. We now placeparticular emphasis on work style reforms and conduct bothcompany-wide and division-specific initiatives to reduce total
annual working hours, encourage employees to take paid
holidays and improve the work efficiency and productivity.
With respect to working hours, we set quantitative
company-wide targets of reducing total annual working hours
to the range from 1,900 to 1,999 hours in a year andincreasing the average number of paid holidays taken by an
employee in a year to 15 days or more in 2017. The divisions
also set their own targets and worked to meet them

the theme of showing the abilities of the workplace to theindividually. As a result, we achieved the company-wide

representative from each of Sumitomo Electric, Sumitomo

We also introduced a system of paid holidays that can begroup discussion about the creation of the best and strongest

mechanism that meets various needs including those for childcompanies gave the attendants an opportunity to widen their

allows employees to balance their work and life. We havefullest, the forum included a panel discussion by atargets.

Wiring Systems, Ltd. and Sumitomo Riko Co., Ltd. as well as ataken by the hour in 2018 with an aim to establish ateam. Such exchange with female workers from otherrearing, provision of nursing care and a visit to a hospital andviews and consider how to address their jobs.

also re-examined the upper limit of overtime based on an

CSR VOICE

Career development whileraising children
Kayo Hashizume

Assistant Manager, Circuit Process Group,
Circuit Technology Department,
Energy and Electronics Materials Laboratory

I am working for research anddevelopment using the short-time work
system to raise a boy who is a 1st-grade
elementary school student and a
two-year-old boy.
When I returned to work from childcare leave, I worried about
the availability of a daycare center to leave my children andwhat job I could do. As for the daycare center, I was able toleave them to the internal child care center of Osaka Works
using the quota for an early return to work (system to givepriority to a child less than one year old for using the center).
For my job, I attended the training program to develop female
main career track employees, which gave me an opportunity
to think about my career deeply together with my boss andallowed me to imagine my potential and the specific figurethat I want to be. I still have a dialogue with the boss regularly
after the training.
While I already recognized that the Company has
well-developed systems, I suppose that employees areprovided with opportunities to explore how to use theirabilities and play their role together with their superiors. Witha sense of security that I can consult with my boss or otherpeople around me, I will continue to do my best to contributeto the Company while raising children.

53 CSR Report 2018agreement under Article 36 and also worked to prevent
overwork through education of managers on working hours
and other activities.
We are taking measures in response to the issues ofindividual workplaces and persons identified based on
findings in the 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.
We now set the slogan of "Be brave to change, be serious towork and be patient to continue" and conduct initiatives fromvarious perspectives including efforts to change the corporate
culture and awareness, as well as enhancement of
productivity through the use of infrastructure and IT tools andthe review of work rules and processes. We will continue toreview the work styles, which will not only reduce working
hours but also contribute to the maintenance andimprovement of business performance, for the growth of ourbusiness.
Average Overtime Hours and Average Number ofPaid Holidays Taken by Employees by YearYear
Average overtime
hours per month

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 201722.1 21.0 14.2 19.1 20.5 18.6 19.3 20.4 20.8 20.2 19.3
hours hours hours hours hours hours hours hours hours hours hours

Average number ofpaid holidays taken by 11.4 12.1 12.4 11.5 12.3 11.7 10.4 12.1 12.1 14.1 16.0
days days days days days days days days days days days
employees per year
(Note 1) Average among labor union members of Sumitomo Electric(Note 2) The data are based on January to December in 2017.

(Hours)

2,100
2,050

2,068 2,049

1,950
0

2,047

2,031 2,042 2,023 2,042 2,042

2,000

2,024

The union and management are committed tosolving various problems through in-depth discussions

1,999

Sumitomo Electric believes that the development of a

1,9652007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 (Year)(Note 2) The data are based on January to December in 2017.

company goes hand-in-hand with the well-being of its
workers' union members. On the basis of this belief,
Sumitomo Electric strives to address various relevant issues
by thorough discussion between the union and management,each party respecting the other's standpoint. In particular, theImplementation of the Survey toCreate a Lively Working Environment

Central Management Council Meeting, which is held fourtimes a year, has a history of about 70 years, and has served

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 2017 as well, about 23,000 employees were surveyed

Results of the Survey toCreate a Lively Working Environment

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 in speciﬁc functions from different sections
directly talk with board members, general managers or otherexecutives.
The participants have precious opportunities to inform theexecutives of problems and requests concerning humanresource development, promotion of diversity and work stylereform, as well as those speciﬁc to their functions, and sharesuch problems to seek clues and solve them. The meetings
also provide the participants with opportunities to listen
directly to the policies of the Company and opinions ofexecutives and to help them create networks with employees

Dissemination ofBusiness Spirit andCorporate Principles

Specifically, we organized the town meetings for section
chiefs and deputy section chiefs in production sites at Itami
Works, for managers and main career track employees at

3.62Manager'sManagement

Tokyo Head Office, Chubu District Office and Kanto Works
and for employees on general track at Osaka Head Office
and Tokyo Head Office in fiscal 2017. We also held town
meetings for mid-career workers and employees of various
nationalities at Osaka Head Office and Yokohama Works to

3.29

have talks with employees with diverse career backgrounds.
The opinions and other comments presented in the town

3.47

meetings are communicated to the relevant divisions on atimely basis and used for organizational operation, planningof personnel systems and other purposes, as well as for the

3.25

facilitation of the initiative.

Motivation

3.44

3.54
Satisfaction in
Working2

35-grade scale

4

Environmental
Preservation

FY 2017
FY 2016
FY 2015
FY 2014
FY 2013

Human Resources

Devotion to Job

0

Supply Chain

3.94

Communicationin the workplace

Qualityin other divisions who are close in age.

3.64

Workplace
Atmosphere

Social Contribution

surveyed the degree of penetration and effect of themeasures to promote health and productivity management
and used the results to review our health-related programs.

environments and managing conditions. While working styles

Core
Category

workplace to consider specific measures against the issues,
such as strengthening of dialogue and transmission of the top
message, and promote activities for improvement.
We also set questions that respond to the problems
recognized in the respective years. In fiscal 2017, weof the union and management concerning businessGroup's CSR Activities

in October and November, including those o f G r o u pcompanies. Some overseas Group companies were also
covered by the survey from fiscal 2015.
The content of the survey is reviewed every year. While theresults for most of the items checked for the change overtime showed improvement, there were still issues to beaddressed in some areas including "Motivation" and we havedesigned and implemented personnel measures or training to
respond to them. The survey results are also fed back to the
responsible person in each organization to encourage eachas a forum for exchange of opinions between representatives
Governance

We have added questions about dissemination andsharing of the mid-term management plan for a better
understanding of the current situation of each workplace

Workplace
Discipline

Business Outline(Note 1) The graph above covers personnel data for Sumitomo Electric employees (including thoseon loan to Sumitomo Electric aﬃliates and other organizations within the facilities).

Bad

Basis for Management

Labor-Management Relationship

Average total working hours by year

5
Good

CSR Report 201854

Sumitomo Electric Group
Health Management Declaration《 Mental Health 》

We will further promote the maintenance and improvementof employees' health to realize health and productivity
management＊ in cooperation with the Health Insurance Societyof a related handbook and supply of relevant information on

Sumitomo Electric is committed to dissemination of basic

knowledge regarding mental health care through distribution

The Sumitomo Electric Group cannot achieve sustainable
development or growth without the health of each employee.
Having announced the Sumitomo Electric Group HealthManagement Declaration in 2015, we position the humanresources base as one of the most important management
resources for the sustainable development and growth of acompany. We will actively assist employees in developing theirhealth and work to establish a lively workplace through theorganization of in-house sports events and other initiatives.

《 Launch of "Kenkatsu!"＊ Health Maintenance andImprovement Activities 》

conducted initiatives including walking events, subsidization of
fitness gym memberships, organization of exercise experienceseminars and moderate and responsible drinking/quitting
smoking seminars, measures to prevent passive smoking andmental health measures. We also organized Health Festa, as
well as athletic practice sessions with current and previous
members of our athletics club, to help employees, their family
members and local people promote their health. In December
2017, we created Kenkatsu! webpages in our internal website
to diffuse the basic knowledge of health and productivity
management, enhance awareness of health among employees
and promote Kenkatsu! activities.

《 Initiatives to Prevent and Improve Metabolic Syndrome 》
These initiatives mainly aim to improve the eating and exercise
habits of employees. As an initiative to improve their eating
habits, we organized a seminar on moderate and responsible
drinking and 59% of the 427 participants now follow theadvice including having two or more alcohol-free days a week
and moderation of drinking. We also jointly organized aseminar on quitting smoking and 21% of the participants now
work on it. In the future, we will enhance special healthguidance, which has been given conventionally, to reduce theemployees who have symptoms of metabolic syndrome.
To improve the exercise habits of employees, we organized awalking event to set and achieve a target of walking 8,000
steps in a day for three months. This event was held twice andjoined by 3,126 persons in total. We also introduced a system
to subsidize fitness gym memberships and have received
2,125 applications. In June2017 and January 2018, we
invited trainers from RIZAP, a

encourage employees to pay attention to any signs of theirown mental health problems, which was taken by 605
p e r s o n s , a s w e l l a s“ c a r e b y s u p e r v i s o r ”t r a i n i n g f o r

management level employees, which was taken by 316

persons. In addition, we station counselors at operating sites
and external counselors with whom family members of
employees can also consult.

In the future, we will conduct working environment

improvement activities (named "workplace health checkup")
comfortable workplace.

《 Contribution to Sports Activities 》

With the current and former members of our athletics club

serving as lecturers, we organized an athletic practice session
for employees and their family members as well as

elementary school, junior high school and high school

students and local runners twice and a total of 181 persons
joined the sessions. Starting with warm-up exercises, theparticipants received lessons suitable for the level of each ofthem to learn the joy of running and improve their runningabilities. Going forward, in addition to Health Festa, which isalso joined by local residents, we will work to organize

company-wide sports matches between internal sports clubs
and circles, as well as sports academies with experts, inorder to develop a sense of unity in each worksite, involve
more people in sports activities and improve exercise habits.

《 External Assessment 》●

Certification as the "White 500"

The Ministry of Economy, Trade and Industry of Japan has
established a system to certify organizations engaging instrategic efforts for the health management of employees
from a management perspective jointlywith Nippon Kenko Kaigi. Sumitomo
Electric was recognized as a 2018
Certified Health and Productivity

Management Organization under theLarge Enterprise Category (White 500)of this system in February 2018.

We will further enhance our efforts to give health guidance

and assist employees in improving their exercise habits toprevent and improve metabolic syndrome while developing
productivity management in our Group companies in Japan.

Support for Balancing Work and Lifeto receive 410 participants.

Sumitomo Electric & RIZAP exercise habit seminar《 Prevention of Passive Smoking 》

We are working to close our indoor smoking areas inprinciple by the end of March 2019 and have closed 108 ofthem as of March 2018. We also established a day to
encourage employees to quit smoking and stopped sellingcigarettes in our facilities in March 2018. Through these
initiatives and other efforts, we aim to create a working
environment with no passive smoking.

55 CSR Report 2018

company-wide scale by providing“self-care”training tovarious health-related initiatives to realize health andmajor fitness gym chain, toorganize a "Sumitomo Electric &RIZAP exercise habit seminar"

A registered trademark of Workshop for theManagement of Health on Company and
Employee, an NPO

work to manage mental health care for employees on a

based on the results of stress level tests to create a more

We launched activities for the maintenance and improvementof employees' health called "Kenkatsu!" in June 2017 and have

Glossary ＊Health and productivity management

the corporate website and in-house magazines. We also

＊ Kenkatsu!

We 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 stylethat achieves the proper balance between work and life andhas also developed child and family-care related systems
actively. For these efforts, the Company has been certified by
the Ministry of Health, Labor and Welfare as a company thathelps its employees balance work and childcare based on

A coined term used in Sumitomo Electric to collectively refer to health maintenanceand improvement activities promoted in companies and worksites and by individuals
to extend healthy life expectancy and develop a sense of unity in worksites

the Act on Advancement of Measures to Support Raising
Next-Generation Children.

In fiscal 2017, we expanded the coverage of the teleworking
system introduced for the employees subject to constraints

2018, these three centers take care of 52 children in total.

on their work at various life stages(pregnancy/childbirth, child rearing andnursing care) and also provided

We also established a childcare center operated jointly withother nearby companies in the neighborhood of our Tokyo
Head Office in April 2018.
In addition, for employees who cannot use our childcare

employees with opportunities to obtainrelevant information including nursing care

help employees balance work and life.

centers, we are taking other supportive measures such as
subsidizing their use of other childcare centers.
Mark Certifying
Corporate Support for
Parenting, Kurumin＊《 Hokatsu Concierge System 》

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 place

Various Support Programs

their control such as childbirth, childcare and nursing care. In
the scheme, we organize interviews and reemploy eligible

circumstances of individual employees, as well as information
on childcare facilities, is provided in this system.

leave return to work smoothly at the time she hopes toreturn. Know-how on hokatsu depending on the

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

We introduced a teleworking system, which allows
employees who face restrictions to their work due tochildcare, nursing care, etc. to work at home or otherlocations in fiscal 2016. We will continue to work to enhance
the flexibility of working styles and develop an environment
where diverse human resources can play more active roles.

《 System to take a leave to accompany his/her spouse
who is assigned overseas 》《 Volunteer Holiday System 》《 Childcare Centers 》

As a measure to foster a supportive environment for
employees working full-time while raising children, Sumitomo

Number of Users of the Employee Support Programs

Male

FemaleTotal

Enrollment in thereemployment system

Users of internal
child care centers
for children

Users ofthe volunteer
holiday system

FemaleTotal

12（10）115（60） 127（70）

65

18

254

272

1

21

22

64

6

2013

15（13）106（56） 121（69）

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

2017

52（52）105（49）157（101）

112

19

263

282

0

23

23

52

6

Supply Chain

Male

2012

Quality

FY(persons)

Employees who used
Employees who took
the short-time work system
leave when theirspouses gave birthMale Female Total

Social Contribution

Employees can take up to 10 holidays in a year to engage involunteer activities approved by the Company. This system isused for various social contribution activities such as coachingof local children in sports activities and accompanying ofchildren on trips for residential training and games.

Core
Category

In April 2017, we introduced a system in which an employee
can take a leave of absence to accompany his/her spouse who
is assigned overseas. This system allows temporary retirementin such a situation in order to prevent employees from retiringand encourage them to return to work after the leave.

Group's CSR Activities

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 theirformer workplaces.

Governance《 Reemployment System 》

of residence and the month of birth of the children.
This Hokatsu Concierge system, which was started in
November 2014, aims to help employees during childcare

We provide each of the employees with various types of support

Employees who tookchildcare leave

Business Outline

seminars that helped understand physicaland mental preparation for nursing care offamily members. We thus make efforts toBasis for Management

Electric opened childcare centers at its Yokohama and Osaka
Works in March and April 2008 respectively, and added athird center in Itami Works in March 2009. As of March 31,

The number in brackets indicates the number of the employees who took the leave for the ﬁrst time in the ﬁscal year.
(Note) The table above covers data for Sumitomo Electric employees, including those on loan to Sumitomo Electric aﬃliates and other organizations.

Human Resources

CSR VOICE

I used the system to take a leave to accompany my husband, who is assigned overseas
Toshimi Suzuki Assistant Manager, Optical Communications Laboratory (currently on leave)
When the overseas assignment of my husband was decided, I initially thought of using the reemployment
system to retire once and then return to work in the form of reemployment. However, there was no

guarantee to be reemployed and, most importantly, I felt uneasy about retiring from the Company for which
could be reemployed or not after retirement and also allowed me to concentrate on handover in Japan and preparation for starting anoverseas life. I would like to improve my language skills and learn various cultural differences to improve myself during the leave. Although
women thus face a choice at each life event, I hope that the Company keeps increasing options for women to continue to work.

Environmental
Preservation

I worked for 25 years. Just then, this system was introduced and it eliminated my concern over whether I

Glossary ＊Mark certifying corporate support for parenting, Kurumin

The Ministry of Health, Labor and Welfare granted this mark to Sumitomo Electric for achieving thegoals set under its First Action Plan (from April 2005) to Fifth Action Plan (to March 2015) basedon the Act on Advancement of Measures to Support Rising Next-Generation Children.

CSR Report 201856

Human Resources Development
Personnel Needed by Sumitomo Electric
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

Training categories of SEI University

Humanskillsand knowledge rooted firmly in the basics, and who can play

active roles in the global community. We provide various training
programs to support employees in becoming such personnel
based on the concepts of the“individual employees' strong

Problemsolving
skillsTechnical skills

Basic
literacy

Manufacturing

The Sumitomo Spirit

Expertise

Corporate philosophy

motivation for self-development”and“on-the-job coaching andclose communication between superiors and subordinates.”SEI University

Record of the training sessions organized acrossthe Sumitomo Electric Group in FY 2017
Applicable employees

We work to improve the value ofhuman resources throughout the GroupSEI 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:Total length oftraining(hours)Sumitomo Electric employees

61,729358,981

Employees ofGroup companies in Japan

19,37979,3898,930

62,824

Total

90,038501,194

Employees ofoverseas Group companies

Record of unique training sessions organized inindividual Group companies in FY 2017
Applicable employees

Fundamental Principles of SEI University

Total number ofparticipants(persons)

Total number ofparticipants(persons)

Domestic Group companies(24 companies)

Overseas Group companies(63 companies)

Total length oftraining(hours)25,548

161,735

95,986

246,025

121,534

407,759① Disseminating the Sumitomo Electric Group's corporate philosophy,

Total③ Developing employees' abilities, skills and knowledge so thatthey may play active roles in the global community.

Addressing Globalization across the Group② Sharing the Sumitomo Electric Group's management strategies
and vision, andWe develop training activities globally across the Group①Development in Group companies in Japan

Human Resources
Development

To promote human resources development across theSumitomo Electric Group, we provide employees of ourGroup companies in Japan with opportunities to attend

SEI University

Employee
performance evaluation
Job rotation（OFF-JT）

Management By
Objectives
Discussion on careerOJTThe Sumitomo Spirit
Corporate philosophy

training sessions organized by Sumitomo Electric. The numberof the participants from our Group companies in Japan in the

training programs for new employees, mid-career employees,
newly promoted personnel and technical trainees isincreasing 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.

SEI University provides more than 300 training programs,
including position-based compulsory programs for all Group
employees ranging from executives to new employees, in thethree areas of human skills, problem-solving skills andtechnical skills. Our Group companies and divisions alsoorganize their original training programs in the field oftechnical skills to have the trainees acquire the uniqueknowledge and skills especially required in the respective
workplaces.
In particular, the Sumitomo Spirit is positioned as the basis for
employees to perform the business. We give them
opportunities to learn about it in the training programs for
new employees and various position-based training
programs. The pre-transfer training program provided for theemployees to be assigned overseas is also designed toensure that they can convey the Sumitomo Spirit in their own
words in their new workplaces. Likewise, we are developing
an environment where the Sumitomo Spirit can be learned
periodically in Group companies in Japan and abroad.

57 CSR Report 2018

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
Outline of the training program：

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.

Outline of the training program：

Global Leadership Development Program (GLP)

Target： Managers
Outline of the training program：

SEG Management Program based on the Sumitomo Spirit (MPSS)The Number of Participants in MPSS (cumulative total)(persons)
600

576

500

436

400

59

100
0

2013

144
2014

2015

2016

2017

③ Small-group activities

Sumitomo Electric develops and promotes small-group
activities (called“SGA”) to solve problems and achieve
objectives voluntarily on a workplace basis with the aims ofdeveloping human resources and energizing the workplace.
This initiative, launched in 1958, has been also introduced into
overseas companies and expanded to involve a total of 45
thousand participants from 166 companies across the Group in
working on 2,895 themes.

Group's CSR Activities

270

200

GovernanceThis program aims to diﬀuse the Sumitomo Spirit and improveskills to manage subordinates. The sessions are provided in six
cities in Germany, the United States, Singapore, China (Shanghai
and Shenzhen) and Mexico and a total of approximately 150
persons attend the common program in those locations in a year.

We organize two types of practical professional training aimed
at cultivating key personnel who are anticipated to drive
manufacturing innovation and reinforce SEQCDD improvement,
namely MKP (Monozukuri Kakushin Pro Jissen Dojo, or
manufacturing innovation professionals' workshop) and GKP(Genba Kaizen Pro Jissen Dojo, or on-site improvement
professionals' workshop). MKP has also been positioned aspart of the program to develop plant managers since this fiscal
year with an aim to improve the problem-solving skills of
successors of plant managers (candidates for plant managers in
the future). In both training programs, important challenges of
the respective divisions are selected as the themes, andtrainees are assigned to the divisions of their themes toperform practical activities.

Business Outline

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.

300

Basis for Management② Practical training

Target： General Managers(Fiscal year)

Cultivation of Manufacturing Personnel

The underlying concept is to learn with actual machines andWe held the Sumitomo Electric Group Small Group Activity
Convention in August 2018 with the participation of 10 groups
in total, consisting of six groups representing domestic divisions
and four groups representing four overseas areas (Americas,
Europe, China ※ and ASEAN ※ ). To prepare for this event, atechnologies. These programs are systematically organized and※ These groups were selected from among the representatives of thecountries/regions in the area.

latest technologies, the curriculums are wide ranging fromtraining on SEQCDD, which are essential subjects fortechniques and equipment control and maintenanceprovided in a planned manner. The number of the participants

Quality

manufacturing, to the Group's proprietary technologies andregional convention was held in each of the four overseas areasfrom October 2017 to May 2018. The participating companies
also used the regional conventions as an opportunity tostimulate their small group activities (Group-wide kaizen
activities) and to interact with other companies.

products using all the five senses. Designed to deal with theSocial Contribution①Basic training on manufacturing

Training session on how to promote SGA in China

Core
Category

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 also growing every year. We have also launched a program
to support Group companies in Japan by developing humanSupply Chain

resources that can serve as trainers within the respective
companies so that they can organize training independently.

Overseas, in China and Southeast Asia, in addition to basic
training on SEQCDD, we organize training on basic

Vietnam

10,000Europe

China

8,000

Award ceremony for the representing group in each regional convention

Number of participants in training on manufacturing by year
(persons-days)
16,00015,336 15,500

14,00012,000

6,000
2,000
0

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (Fiscal

Employees from Overseas Aﬃliates

Aﬃliate employees

Targetyear)

Sumitomo Electric employees

We are working to further enhance the contents of these three
types of education through information exchange andinteraction between planning/operations divisions and thedivisions of the participants to enhance our manufacturing
capabilities even more.

CSR Report 2018

Environmental
Preservation

4,000

Human Resources

Americas

maintenance of equipment on a regular basis.

58

To Become a Company with the Highest Level of Safety
Basic Approaches
The Sumitomo Electric Group considers that securing ofhealth and safety of employees is the basis of the business.

《 Promotion of Structural Reinforcement on a Company-wide Scale 》●

Dissemination and application of safety global standards●

We promote the establishment of culture to prioritize safety
above all else and continuously perform safety and health●activities involving all employees to eliminate risk factors fromour workplaces, as well as to become a company with thehighest level of safety. Specifically, we have set medium- tolong-term Sumitomo Electric Group Safety and HealthCommittee, which is composed of members frommanagement and the union.

●●

Improvement of safety awareness to eliminate unsafe actions
Development of S-T-O-P Accident Campaign

Recognition of weaknesses to specify the ideal state we seek

Strengthening of chemical management●●

Sumitomo Electric Group Safety and Health Targets

Development of education to increase risk awarenessRe-establishment of safety culture●

Targets. To meet the targets, we specify priority activities andpriority subjects for each fiscal year at the Health and Safety

Development and training of human resources inJapan and overseas●●

Dissemination of Sumitomo Electric's safety standards
on a global scale

Strengthening of the management of speciﬁc chemical
substances and poisonous and deleterious substances
Cooperation with the Occupational Health and Safety
Management Committee

1．Realizing accident-free worksites andcreating comfortable working environments
2．Maintaining and improving compliance

3．Promoting employees' physical and mental health care

Activity targets for ﬁscal 2017
Serious accidents and accidents resulting in remaining disabilities: 0● Total number of accidents resulting in lost work time, no lost work
time accidents and accidents causing minor injury: 24 or less●Examples of Priority Safety Activities

Identification of Serious Disaster Risks■ Self inspection in the bases

We reviewed the checklist prepared to prevent serious
accidents based on the analysis of such accidents that
occurred in the Japanese manufacturing industry withinspection items including becoming caught inPriority subjects for ﬁscal 2017

equipment, forklift-related accidents, falls and electric

Safety activities involving human lives withparticipation of all employees under the initiativeof top management"activities for ensuring safety in multi-worker operations"《 Reinforcement of fundamentals in each division 》●

Priority safety activities① Activities to prevent serious accidents
Conformity with global standards and continuous
implementation of inspections●② "Safety! Power OFF Activity"
Identiﬁcation of operations involving access to any
moving part without turning oﬀ the power andcountermeasures●③ Activities for ensuring safety in multi-worker operations●in accordance with this checklist and identified morethan 10,000 issues that require countermeasures, which
are currently taken for improvement.
■ Local inspection (instruction to parent divisions)With focus on the parent divisions of Business Units incharge of instruction on self inspections in the bases, we
conducted local inspections that were also used toinspection was conducted in 28 bases including all

Identiﬁcation of daily changes and problems throughthe 1-2-3 activities

risk identification and assessment activities. We will

Global safety evaluation

Identiﬁcation of weak points in safety management andsafety activities and support of their improvement●

Emergency / priority safety management activities●

Plant disaster prevention activities●●

Structural improvement based on the recognition of the weaknesses

Inspection of special material gas and combustible gas
facilities, electrical devices and outdoor utilities to
identify any problems and assess the degree ofobsolescence

Strengthening of horizontal diﬀusion activities●●●

59 CSR Report 2018

concerning serious disaster risks in their own processes

Stimulation of the bottom-up activities with a
top-down approach●●

Japan and overseas conducted a self inspection

provide the parent divisions with training on confirmation《 Strengthening of Weak Points on a Company-wide Scale 》●(nine categories, 70 items) to the checklist. Our bases in④ Prevention of recurrence of similar accidents involving injury
Horizontal diﬀusion and completion of the preventive measures●●

shocks, and newly added "Power OFF Activity" andEﬀective use of information on minor injury and serious"hiyari" (near-miss) cases
Measures to prevent accidents on the way to work
Campaign to prevent falling accidents

and instruction methods. In fiscal 2017, a local
parent divisions to check the appropriateness of the
manage the risks identified through self inspections by
the bases and progress of the countermeasures at
the initiative of the parent divisions, and seek thethorough implementation and establishment of thecountermeasures to prevent serious accidents.

Accidents involving injuries
Sumitomo Electric GroupIn fiscal 2017, the number of the accidents involving
injury increased slightly from fiscal 2016

Japan

injury, which were broken down into 10 injuries resulting inserious accidents and accidents resulting in remaining

FY
2017

time, no lost work time accidents or accidents causing minor
injury. Meanwhile, there were no serious accidents for threeconsecutive years. We believe that this is a result of the
FY
2016

0

4

14

4

25

1

10

36

3

1

7

3

7

17

2

No lost work
time injuries

11

10

Minor
injuries

3

Total

19

16

7

42

4

21

67

Accidents
resultingin lost work
time

4

4

3

11

1

2

14

No lost work
time injuries

13

6

2

21

7

1

29

Minor
injuries

3

3

1

7

3

6

16

Total

20

13

6

39

11

9

59

activities for ensuring safety in multi-worker operations and 4)(Note) The data on employees of the Sumitomo Electric Group cover Sumitomo Electric andits 103 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.

Group's CSR Activities

to equipment decreased from the fiscal 2016 level with the103serious accidents, 2)“Safety! Power OFF Activity,”3)

Looking at the injuries by situation, while injuries attributed

Overseas5

launched in fiscal 2016, which were 1) activities to prevent

prevention of recurrence of similar accidents involving injury.

Total

Governancehalf of fiscal 2014 as well as the priority safety activities

Employees
Japan

Accidents
resultingin lost worktime

disabilities and 24 or less accidents resulting in lost work

activities to prevent serious accidents launched in the second

Temporaryworker,Sub
Overseas subcontractor total

Business Outline

lost work time, 25 no lost work time injuries and 7 minor
Systems Group), and thus failed to meet the target of zeroSWS Group

Employees

During ﬁscal 2017, we had a total of 42 accidents involving

injuries (excluding employees of the Sumitomo Wiring

Basis for Management

Safety Performance and Future Actions

effect of disseminating the Global Standards for Equipment
and the priority safety activities, injuries by inserting a hand
into moving parts, by fall or by other actions of people
remained unchanged or increased in fiscal 2017. It is achallenge to enhance the safety awareness of all employees.
In fiscal 2018 we are making efforts to achieve a target ofzero serious accidents and accidents resulting in remaining
no lost work time accidents or accidents causing minor injury（Frequency rate）

2
1.5
1

1.9

0

3) foster a culture of safety, which are the core initiatives of
Safety VISION 2022, and promote Power OFF Activity andother activities to prevent serious accidents.

1.62 1.61 1.62 1.59 1.58 1.66 1.61 1.63 1.66

00.16 0.10
0.08

0

0

0.06

0.20 0.14

000.08 0.14

0.03

0.19 0.14 0.11 0.13

000.07 0.07

02006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 （Fiscal year）

All industries

Manufacturing industry

Sumitomo Electric GroupSWS(Note) The lost time injuries frequency rate for employees in Japan in the Sumitomo ElectricGroup covers Sumitomo Electric and its 40 aﬃliates in Japan (excluding SWS and theother listed companies), and the frequency rate in SWS covers SWS.

Social Contribution

0.5 0.33

to“become a company with the highest level of safety.”2) develop human resources with high safety awareness and

1.8

1.15
1.02
1.02 1.09 1.12 0.99 0.98 1.05 1.00 0.94 1.06 1.06

and an accident score of 216 or less, as part of our activities
Specifically, we will 1) implement safety measures in facilities,

1.83

Core
Category

disabilities, 38 or less accidents resulting in lost work time,

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

Quality《 Initiative Using an Accident Score 》

We will introduce "accident score" as a new target index
for Safety VISION 2022.

An accident score is calculated by weighting the accidents
that have occurred by type. This index is established toreduce accidents for which the management andSupply Chain

supervisory responsibility is large.

Accidents are specifically classified into:
Class 1: Accidents that society strongly demands to prevent;e.g.: Accidents covered by the activities to prevent
serious accidents, etc.

Human Resources

Class 3: Accidents that can occur anywhere in social life; ande.g.: Falling accidents, accidents while walking
normally, accidents causing backache, etc.
Class 2: Accidents other than those in Class 1 or Class 3.
e.g.: Accidents caused by an edged tool, burr or jig, etc.
Then, a score is given according to the type and level (serious
accidents/accidents resulting in remaining disabilities,

accidents resulting in lost work time, no lost work time
Environmental
Preservation

accidents, accidents causing minor injury) of the accident.

With the introduction of the accident score, we will facilitate
the visualization of risk reduction.

CSR Report 201860

■CSR Core Category

Environmental
Preservation■

CSR Priority Theme

Prevention of Global Warming

There is still much more we can do.
There is no end to our environmental preservation activities.
Companies are increasingly required to promote environmental preservation
activities, which are also a part of Environmental, Social and Governance(ESG) investing now.
While the Sumitomo Electric Group set the target of reducing the total
amount of CO2 emissions by 5% from the ﬁscal 2012 level in VISION 2017,
the actual result was a reduction of 2.3%. Although we thus failed to meet
the target, the growth of our sales by about 20% over the ﬁve years was areason for it. We are proud of the result as an outcome of the eﬀorts of our
ﬁeld staﬀ to reduce CO 2 emissions per unit of sales by 4% every term in
addition to our activities to lower power consumption after the Great East
Japan Earthquake.
For VISION 2022, while aiming to achieve another 20% sales growth, we set
a target of achieving no increase in the total amount of CO 2 emissions fromthe ﬁscal 2017 level. It is actually diﬃcult to meet it because we havealready taken almost all of the measures we can take. Still, we will analyze
the current situation of the entire supply chain concerning the items
including those of Scope 3 in the ﬁrst two years of VISION 2022 (Phase 1) toestablish medium- and long-term targets and strive for wide-ranging
reduction activities in the last three year of VISION 2022 (Phase 2).
We also consider that there are still measures for energy saving, such as theuse of waste heat and unused heat in factories. In addition to commitment
to renewable energy and eﬀorts to address water risks, we will continue toenhance our activities for energy saving.

Nobuya Ooka

General Manager, 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 to preservation of the global environment.

Environmental Policy (extract)※
Basic Philosophy

The Sumitomo Electric Group thinks it is primarily important toestablish 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 mostimportant issues for corporative management, the Sumitomo
Electric Group promotes the activity based on its action plan.
●●

Organizations for
Promoting Environmental Management
The Corporate Environment Committee deliberates andmakes decisions on the Group's environmental preservation
activities and oversees the activities on a global basis.

President
Corporate Environment Committee
Environment Task Committees
Business Unit Environment
Committees

Reduce environmental impacts in manufacturing activities
Prevention of global warming, saving and recycling ofresources and prevention of environmental pollution

Increase environmentally-conscious products and services
Phase out of harmful substances, and implementation of
product assessment and product LCA＊Internal Environment
Audit Teams

Works Environment Committees

Divisions

Divisions2. The Group will fulﬁll and enforce environmental management system.
● Provision of educational programs on environmental
preservation and implementation of environmental audits

Domestic aﬃliates
located inside Works

Domestic aﬃliates
located inside Works

3. The Sumitomo Electric Group will maintain and improve
compliance action.

Domestic aﬃliates
located outside Works

Domestic aﬃliates
located outside Works

Overseas aﬃliates

Overseas aﬃliates

4. The Sumitomo Electric Group's Environmental Policy will be
opened to the public upon request.

61 CSR Report 2018

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

Action ECO-21 Campaign
The Sumitomo Electric Group has conducted the Action ECO-21 Campaign since April 2003, focusing on environmental
engineering, environmental communication and originality. We developed the Action ECO-21 (Phase VI) Campaign as a three-yearplan from fiscal 2015 and will promote the Action ECO-22V Campaign from fiscal 2018.

Item
Environmental
eﬃciency

Descriptions

FY 2017 results

Evaluation

Monetary value of environmental impacts(CO2, wastes, harmful substances, NOx and SOx) / sales

Reduce 5% from FY 2012

Reduced 29%◎（1）CO2 emissions (in Japan and overseas):
reduction of the absolute amount (Note)

Reduce 5% from FY 2012

Reduced 2.3%△

Reduce 5% from FY 2012

Reduced 21%◎（4）Reduction of CO2 in logistics:
reduction of CO2 per unit of sales

Reduce 5% from FY 2012

Reduced 15%◎（1）Reduction of the zero emission rate (in Japan)

0.3% or less

0.2%

○

（2）Reduction of the zero emission rate (overseas)

9% or less

9.1%

▼

（3）Amount of waste (in Japan):reduction of the absolute amount

Reduce 5% from FY 2012

Increased 16%▼（4）Water use: reduction of water use per unitof sales [Water use / sales]

Reduce 5% from FY 2012

Reduced 25%◎

Reduction of substances of （1）Release of chemical substances (in Japan): reduction of
the absolute amount of PRTR-designated substances
environmental concern

Reduce 5% from FY 2012

Reduced 17%◎

Management of chemical（1）Management of chemical substances in products
substances in products

Ensure compliance with laws
in Japan and overseas

No issues○（1）“Eco Mind”products

Register 100% of new products

１００％

○

（2）Eco-products

60% of the ratio in sales (in Japan)

61％○（3）Products with less CO2 emissions

Contribute to reducing CO2 emissions
by 100 thousand tons/year

126 thousand
tons/year○

Promotion of
resource
conservation
and recycling

Expansion ofenvironmentallyconscious
product range

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)

Targets of the Action ECO-22V Campaign
Descriptions

Targets for FY 2022

Targets for FY 2018

Reduce 0% from FY 2017

Reduce 0%（2）Energy saving (production sites): reduction ofenergy consumption per unit of sales[Consumption in crude oil equivalent / sales]

Reduce 5% from FY 2017

Reduce 1%（3）Energy saving (oﬃces): reduction of energy
consumption per unit of ﬂoor area
[Consumption in crude oil equivalent / ﬂoor area]

Reduce 5% from FY 2017

Reduce 1%（4）Reduction of CO2 in logistics:
reduction of CO2 per unit of sales

Reduce 5% from FY 2017

Reduce 1%

Promotion of resource （1）Amount of waste (in Japan and overseas):
conservation and recycling
reduction of the per unit amount

Reduce 5% from FY 2017

Reduce 1%

Reduction of substances of （1）Release of chemical substances (in Japan): reduction of
the absolute amount of PRTR-designated substances
environmental concern

Reduce 5% from FY 2017

Reduce 1%（1）“Eco Mind”products

Register 100% of new products

１００％（2）Eco-products

70% of the ratio in sales (in Japan)

62％（3）Products with less CO2 emissions

Contribute to reducing CO2 emissions
by 150 thousand tons/year

130 thousand
tons/year

Global warming
prevention

Expansion ofenvironmentallyconscious
product range

Environmental
Preservation（1）CO2 emissions (in Japan and overseas):
reduction of the absolute amount

Human Resources

Reduction ofenvironmental impact
from products

Period: FY 2018 ‒ 2022

Supply Chain

Reduction of environmental impacts frombusiness activities

Item

●

Quality(Note) While the calculation had been based on a ﬁxed emission factor until ﬁscal 2016, the latest available emission factor was used for the calculation of results for ﬁscal 2017.
If the same emission factor used until ﬁscal 2016 was applied to the calculation, the result in ﬁscal 2017 would be an increase of 2.3%.

Social Contribution○

Core
Category

Reduced 27%

energy consumption per unit of sales[Consumption in crude oil equivalent / sales]Group's CSR Activities

Reduce 20% from FY 2012（3）Energy saving (oﬃces): reduction of energy
consumption per unit of ﬂoor area
[Consumption in crude oil equivalent / ﬂoor area]

Global warming
prevention

Governance

Reduction of environmental impacts frombusiness activities

Period: FY 2015 ‒ 2017
Targets for FY 2017（2）Energy saving (production sites): reduction of

Reduction ofenvironmental impact
from products●

Business Outline

Targets of the Action ECO-21 (Phase Ⅵ) Campaign

CSR Report 201862

Response to Environmental Risks and Opportunities through Environmental Management
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

Implementation of detailed compliance audits

Payment of ﬁne〈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

Monitoring Based on Environmental Efficiency
In fiscal 2017, environmental efficiency was
improved by 29% from the ﬁscal 2012 level
The Sumitomo Electric Group has adopted environmental
efficiency calculated based on various environmental impacts
according to LIME＊ as a group-wide indicator on environmental
management. The environmental efficiency was improved by
29% from the fiscal 2012 level in fiscal 2017.
Environmental Eﬃciency

on-site inspection of environmental facilities to enhancesensibility in environmental management was added to theprogram.
We also provide technical education on chemical management
and other issues on a regular basis.
Training opportunity
Career(managerial post-based)
Nominationbased＝Monetary value of environmental impacts (CO2, wastes, harmful substances, NOx and SOx) / Sales
Environmental eﬃciency（×10－4）

16

16.02

12

13.28

11.98

12.09

12.97

11.45

Optional

8
4
0

2012
Base

2013
Result2014
Result2015
Result2016
Result2017
Result・Position-based training
・Training on the management of poisonous anddeleterious substances

・Training on the notiﬁcation of facilities subject toenvironmental laws

・Professional education on environmental laws
・Training on energy saving design
・Training on the Japanese Chemical Substances
Control Act

・PRTR training
・Training on the management ofchemical substances in products(Fiscal year)(Note) Data on CO2 emissions and wastes are collected from Group companies in Japan and overseas
while those on harmful substances, NOx and SOx are from Group companies in Japan only.

Title of the training

On-site・Training on Energy Saving Handbook
・Action ECO-21

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-21 Campaign.
The managerial post-based career training program involves
legal and general education on the environment. In fiscal 2014,

Glossary ＊L I M E

63 CSR Report 2018

《 Audit Implementation Plan and Its Progress 》

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

Life Cycle Impact Assessment Method Based on Endpoint Modeling (LIME) is a method forevaluating the impact of products and services on the environment.

《 Check of the Progress in the
Activities of the Action ECO-21 Campaign 》

2008 and completed in fiscal 2011, and we have conducted
the second round since fiscal 2016.
Environmental audits of manufacturing sites outside Japan
were also launched in fiscal 2010. As of the end of fiscal 2017,
we have completed 48 of the 50 sites subject to audits: We
are now planning to audit the sites that newly joined theGroup in fiscal 2018.

Basis for Management

We have set check items for environmental audits and evaluate
the activities and progress.

《 Conﬁrmation of Legal Compliance 》

In fiscal 2017, any violation of laws and regulations (cases《 Evaluation of Facilities That May Affect Water Quality 》
In response to a revision of the Water Pollution Control Act in2012, we started the evaluation of facilities that use any of thehazardous substances, designated substances, oils, etc. andmay thereby affect water quality. The equipment and ancillaryfacilities are inspected to assess the management status on the
check items set for each of the parts such as liquid storage andpipes.
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 evaluated three sites in fiscal
2017. We will continue to conduct these audits.

where guidance, recommendation or order to pay a fine wasissued by the authority) was not reported to the Safety &Environment Department of Sumitomo Electric.

Business Outline

During fiscal 2017, we had a total of nine cases where anaffiliate received an order to pay a fine from the relevant
authority of the country/region for non-compliance in pastfiscal years, which consisted of six cases in affiliates in Mexico,
Taiwan and Thailand for non-compliance in fiscal 2015 andthree cases in affiliates in Thailand for non-compliance in fiscal
2016. In addition, in April 2018, an affiliate in Taiwan received

Governancean order to pay a fine from the authority for non-compliance.
We will continue to strive for a proper understanding of theregulations in the respective regions to ensure thoroughcompliance.

Environmental Accounting
Financial items
Expense(million yen)

Non-ﬁnancial items
Economic eﬀect(million yen)

Investment inenergy saving

Reduction ofenergy cost

(Note 1)

(Note 4)GHG emissions(thousand tons-CO2e/year)
900
750

764

60

0

▲48

776

600
450

608

2,036 1,034 2,630

882

723

300
150

2016 Change due Change due Actual 2017 (Fiscal
to boundaries
changeInvestment inresource saving
and recycling

Waste
disposal cost

(Note 2)

Sale ofvaluables materials(Note 3)(Note 3)(Note 4)(excluding valuable materials)(thousand tons/year)
50

0

2.9

39.5
▲0.7

61

18

1,037 1,175 1,294 104

127

69

20
10
0

2016 Change due Change due Actual 2017 (Fiscal

1,097 1,049

to saleschangechangeyear)

Cost of environmental organization,
ISO 14001 registration andmaintenance, etc.

ISO 14001 is the core of ourenvironmental management
activities, and the certiﬁcationis requested by customers.
We consider cleanup of theneighboring areas as a basic social
activity, and will continue ourcommitment to communication
with local communities throughthis initiative.

We continuously restore thecontaminated soil andgroundwater identiﬁed in ourfacilities.

Cost ofsocialactivities

7

10

9

Cleanup of areas outside company
sites, external environmental
education, etc.

Cost ofenvironmental
remediation

8

52

8

Restoration of contaminated soil
and groundwater

CSR Report 2018

Environmental
Preservation

Boundaries of tabulation: Sumitomo Electric + domestic aﬃliates(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 2016 from the boundaries of collection newly added or excluded in ﬁscal 2017 (no boundaries were
newly added or excluded in this ﬁscal year).
Change due to sales change: [Emissions or amount of waste in ﬁscal 2016 from the boundaries of collection for ﬁscal 2017] x (Sales in ﬁscal 2017 / Sales in ﬁscal 2016 - 1)
Actual change: Calculated by subtraction

Human Resources

975

Supply Chain

to boundaries
changeWe set the reduction of 5%
from the ﬁscal 2012 level as
the target for ﬁscal 2017. To
reduce the amount of waste,
we are promoting theconversion of waste into
valuable materials.
While the amount of waste
increased due to the impact of
the suspension of imports ofrecyclable waste by China, wewill continue our commitment
to the concentration of waste
liquid as a method to reduce
the amount.

Quality

37.3

30

210

Cost ofmanagement
activities

year)changeAmount of waste

40

Waste
reduction

to saleschangeSocial Contribution

0

We set the reduction of 5%
from the ﬁscal 2012 level inﬁscal 2017 as the target. To
achieve it, we aimed to reduceenergy consumption per unit ofsales by 20% from the ﬁscal
2012 level, and have madevarious energy saving eﬀorts.
These activities are also
important for the reduction ofenergy cost, which has risen
steeply in recent years.
The knowledge learned throughthe activities is also introduced
into overseas Group companies.

Core
Category

Reduction ofgreenhouse gas（GHG) emissions(Note 1)Strategy/
opportunity and risk

Change factors in FY 2017
(in Japan)(million yen)2015 2016 2017 2015 2016 2017 2015 2016 2017

Group's CSR Activities

Investment

64

Material Balance (Environmental Impacts)

I N PUTOUT PUT

Raw materials
Copper ※324 thousand tons

Iron

374 thousand tons

Aluminum

25 thousand tons

Resin

87 thousand tons

Chemical substances ＊ 15 thousand tons
Product packaging materials
67 thousand tons

Production and sales volume

Withinfacilities

Product shipments

Atmospheric emissions

Research &Development

CO2

2,264 million kWh

LPG

Product design
Manufacture

43 million m3

Other fuels

9 thousand kl(converted into crude oil equivalent)

13,102 thousand m3(converted into crude oil equivalent)＊ 14 thousand kl

●

●

●

●

●

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)●

Boundaries of data integration

19 tons

11,167 thousand m3

General wastes

18 thousand tons

Industrial wastes

65 thousand tons

58 tons

CO2 emissions ＊●Transportation fuel : Gasoline, gas oil etc.

223 tons

SOX ＊4 tonsAs industrial waste ＊

●

●

NOX ＊

Into the water ＊●●3,150 thousand tons

Into the air ＊●Product packaging materials : Corrugated cardboard,paper, resin and wood

Scope 3Chemical substance emissions

Logistics

Chemical substances : Chemical Substances speciﬁed in the
PRTR Law

1,326 thousand tons

WastesEnergyMaterials (copper, iron, aluminum and resin): Total quantityof the product materials managed on a weight basis (thoseused by a business unit in the amount of 100 tons or morein total)

177 thousand tons

Scope 2

Wastewater

Resource
circulation

Water

Transportation fuelScope １

Wastewater

Rawmaterials

Water
Water

Shipment

8 thousand tons

City gas

1,461 thousand tons

Other gases (converted into CO2) 43 thousand tons

EnergyElectricity

624 thousand tons●

160 tons

37 thousand tons

Product shipments: Total shipments of the productmaterials managed on a weight basis (those shipped by abusiness 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 andother greenhouse gases converted to CO2 equivalent
NOx : Nitrogen oxides emitted from the use of gas andliquid 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 other trash) generated through business activities
Industrial wastes : Wastes speciﬁed in the "Waste
Management and Public Cleansing Law," including sludge,
waste oils, waste acids/alkalis, waste plastics, metals,
glass, ceramics, cinders and other substances generated
through business activities

Items with ＊: Sumitomo Electric + domestic aﬃliates; Items without ＊: Sumitomo Electric + domestic and overseas aﬃliates※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.

Explanation of the Boundary

In promotion of environmental management, Sumitomo Riko Company Limited, Nissin Electric Co., Ltd. and Sumitomo Densetsu Co., Ltd., which
are listed in the stock exchange in Japan, and their consolidated companies are excluded from the boundaries of the environmental
management of the Sumitomo 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, the emissions from the boundaries of the environmental management of our Group, 1,503 thousand tons, account for the vast
majority of 1,867 thousand tons, which are estimated GHG emissions from the boundaries of consolidation for financial reporting in fiscal 2017.
In the meantime, out of the 248 consolidated subsidiaries excluding the 3 listed companies mentioned above, the environmental managementof our Group covers 145 companies in production units (42 in Japan, 33 in China, 34 in Asia (except China), 15 in the Americas and 21 inEurope and other in fiscal 2017). The two sites of SEEV＊ and SSWT＊ are not covered because a data collection system is currently being
established in each of them. GHG emissions from the two companies are estimated to be around 78 thousand tons, which accounts for about
5% of the total GHG emissions from the entire scope of the environmental management of our Group.

Glossary ＊SEEV

65 CSR Report 2018

SEI Electronic Components (Vietnam), Ltd.

＊SSWT

Sumiden Steel Wire (Thailand) Co., Ltd.

Activities to Prevent Global Warming

Our CO2 emissions decreased in Japan but grew
overseas from the base year.
We will promote energy saving activities

Emissions converted to CO2 equivalent(thousand tons-CO2e/year)

1,430

Change due tosales change

2017

Actualchange(Fiscal year)(Note) Change due to boundaries change: Emissions in ﬁscal 2016 from the boundaries ofcollection newly added or excluded in ﬁscal 2017.
Change due to sales change: [Emissions in ﬁscal 2016 from the boundaries of collection forﬁscal 2017] x (Sales in ﬁscal 2017 / Sales in ﬁscal 2016 - 1)
Actual change: Calculated by subtraction

Greenhouse Gas Emissions from the Global Operations of
the Sumitomo Electric Group by Region(thousand tons-CO2e/year)

800

787

700

761 744730

764 776

600
500
400

285 285 295
263 263 268 258 276 255 278 267

300
200
100
0

312

93 104 107 99 96 95

48 47 52 57 65 66
Europe, etc.

2012

2013

China

2014

Asia

Japan

(except China)

2015

2016

America

2017

0（Note 2）

1,503

1,436

682

681

711

700

732

728

696

787

761

744

730

764

776

741

3

Production efficiency has been improved
We reduced energy consumption per unit of sales by 27%
from the ﬁscal 2012 level in ﬁscal 2017. This signiﬁcant
improvement was attributed to overseas sales growth alongwith improvement of energy efficiency. In the future, we willcontinue the evaluation of energy consumption per unit ofproduction in each division for further improvement, andQuality

800

-3

2.3
1,497

Change due toboundaries
changeSocial Contribution

1,000

▲2.3

2.7

1,456

2016

Core
Category

1,200

1,442

0

Group's CSR Activities

1,400

1,469

1,200

Governance

1,600

1,400

Reduction of Energy Consumption
Reduction ratio (%)

0.9

1.9

1,503
▲151

Business Outline

0

157

0

1,497

Greenhouse Gas Emissions and Reduction Ratio(in Japan and overseas)▲1.9

Factor Analysis of Changes in Greenhouse Gas Emissions(in Japan and overseas)
1,600

The Sumitomo Electric Group sets the target of reducing GHG
emissions by 5% from the fiscal 2012 level in fiscal 2017 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.
Since fiscal 2012, especially in response to skyrocketing energy
costs in Japan, we have enhanced our system for energy saving
efforts with the Energy Saving Office serving as the organizer.
We have appointed a new task committee member from eachdivision to encourage the divisions to promote energy saving
activities in a more organized and voluntary manner. With
these efforts, improvement of energy efficiency in our overseas
companies is in progress while we are shifting our production
facilities to overseas sites.
While GHG emissions had been calculated based on theemission factor of the base year as a fixed value in order toevaluate the results of our energy saving activities without
external influences, we decided to apply the latest emission
factor for each fiscal year from fiscal 2017 to calculate anddisclose emissions in a way that the amount is closer to theactual value.
As a transitional measure, we disclose both of the results in fiscal
2017 calculated based on the same emission factor used until
fiscal 2016 and those based on the latest emission factor.
As a result, while the production volume in the Group as a wholeincreased, our GHG emissions in fiscal 2017 decreased in Japanbut grew overseas from the fiscal 2012 level. The emissions in
the whole Group decreased by 2.3% from the fiscal 2012 level.

Emissions converted to CO2 equivalent(thousand tons-CO2e/year)

Basis for Management

Reduction of Greenhouse Gas Emissions

strive to meet the target for the whole Group through the

600
400
200

0

In Japan2013
ResultOverseas

2014
Result2015
Result2016
Result2017
Result(Fiscal year)

Reduction ratio(Note1) 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).

Energy Consumption and Energy Consumption per Unit of Sales(in Japan and overseas)
37[Both in Japan and overseas] Emission factor in“Guidelines for accounting and reporting ofgreenhouse gas emissions from industrial commercial sectors”(2003) by the Japanese Ministry of the Environment(Note 2) For the results in ﬁscal 2017, the values calculated based on the following emission factor are presented together.
CO2 emission factor for purchased electricity[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 2016”(2017) by the Japanese Ministry of the Environment

28

30,00025,00030

35

27

23,42023,82923,95823,707

24,39024,710

2012
Base

2013
Result2014
Result2015
Result2016
Result2017
Result30
25

20,00015,00010,0005,000
0In Japan and overseas operations(Fiscal year)

Energy consumption per unit of sales(Note) Energy consumption per unit of sales: Crude oil equivalent of energy consumption divided by sales

CO2 conversion factor for greenhouse gas emissions from non-energy sources:[Both in Japan and overseas] Global warming potential in "Greenhouse Gas Emissions Accounting
and Reporting Manual Ver. 4.3.2" (2018) by the Japanese Ministry of
the Environment

CSR Report 2018

Environmental
Preservation[Overseas] Emission factor in each country for 2015 mentioned in“CO2 Emissions from Fuel
Combustion Highlights 2017”(2017) by IEA

CO2 emission factor for other than purchased electricity (excluding greenhouse gas emissions from non-energy sources)[Both in Japan and overseas] Emission factor in“Guidelines for accounting and reporting ofgreenhouse gas emissions from industrial commercial sectors”(2003) by the Japanese Ministry of the Environment

29

Human Resources

CO2 emission factor for other than purchased electricity

40

32

Basic policy on the emission factors: ﬁxed emission factors are applied to the values for all ﬁscal years
presented in the graph.
CO2 emission factor for purchased electricity[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

Energy consumption per unit of sales(kl/100 million yen)

Energy consumption(TJ/year)Supply Chain

2012
Base

achievement of the target in each division.

66

Emission data for Scope 3
We provide data to CDP＊
In ﬁscal 2014, we increased the number of the categories for

Scope 3 of CDP to publish our emission data, and we started

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.
●

to receive independent assurance on Category 4: Upstream
transportation and distribution.

Greenhouse Gas Emissions in FY2017 (thousand tons-CO2e/year)
Scope １

178

Scope 2

1,326

Scope 3

3,150

Category●

Description

Change in emissions

1

Purchased goods and services

2

Capital goods

2,255

Increased

519

Decreased3

Fuel- and energy-related activities not
213
included in Scope 1 or Scope 2

Decreased

4

Upstream transportation and distribution 37

Increased

5

Waste generated in operations

20

Decreased

6

Business travel

33

Increased

7

Employee commuting73

Increased●(Note 1) 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: Sum of Categories 1 to 7
(Note 2) The data for Category 4 in the table above cover logistics data in Japan only.
(Note 3) 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.

Energy Saving Activities in Production Units
We are working to reduce wasteful use and improve efficiency
with the effects of ideas for energy efficiency improvement《 Energy Efficiency Improvement Measures to Reduce Energy Use 》
We work to meet the group-wide energy saving target of
reducing energy consumption per unit of sales by 4% per annum
from the ﬁscal 2012 level in the Action ECO-21 Campaign.
Meanwhile, Group companies and divisions set the target of
reducing energy consumption per unit of production by 4% perannum from the ﬁscal 2012 level and strive to meet it throughthe discovery of subjects for energy saving and promotion ofactivities in a planned manner. In ﬁscal 2017, while the target
was a reduction of 20% from the ﬁscal 2012 level, we reduced
energy consumption by 20%.
The number of subjects in the submitted ideas and cost
reduction eﬀect are presented below.

Number of Subjects in the Submitted Ideas andCost Reduction Eﬀect by Fiscal Year(million yen/year)
1,400
1,200

549

611

497

166

328

464

600
400
200
0

227

363

610

548

622

712

556

705

1,237 1,193 1,200

1,000
800

670

716

871

(subject/
year)
800
600
400
200
0

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 (Fiscal year)

Cost Reduction Eﬀect

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

Glossary ＊CDP (former name: Carbon Disclosure Project)

67 CSR Report 2018

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 also conduct measurement andanalysis of power consumption during holidays and at night, as
well as the diagnosis in overseas affiliates.
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. 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
We have assigned a member and a vice member of the
Workplace ECO Activity Promotion Committee in each workplacein the head offices, district offices and branch offices. The
committee members perform and promote the following activities:① Dressing cool in summer and warm in winter,to keep air conditioning moderate② Turning off all office lights during lunch break③ Turning off lights and air conditioners in meeting rooms andtoilets when not in use④ Introducing economy mode for PCs and power-saving
OA devices on a preferential basis⑤ Using zone lighting during overtime hours

Reduction of CO2 Emissions in Logistics
We reduced CO2 emissions by offsetting a decrease inrailroad and coastal transportation by shortening
the transportation distanceIn fiscal 2017, per-unit CO2 emissions from transportation in the
Sumitomo Electric Group as a whole in Japan were reduced byapproximately 5.8%(Note 1) with improvement in Sumitomo Wiring
Systems, Ltd. despite the deterioration in Sumitomo Electric due
to a decrease in railroad and coastal transportation.
Sumitomo Electric increased CO 2 emissions in logistics byapproximately 2.1% from the previous fiscal year due to reasons
including a decrease in mass railroad and coastal transportationin the final phase of a large project, as well as a decrease in the
shipment of high-strength steel wires from Itami to thedestinations in Fukuoka Prefecture, although the emissions werereduced with integrated transportation of the freight to be
shipped from Sumitomo Electric Tochigi Co., Ltd. to thedestinations in Fukushima and Aichi Prefectures along with theuse of trailer trucks for the shipments instead of 15-ton vehicles.
Sumitomo Wiring Systems, Ltd., on the other hand, reduced CO2
emissions in logistics significantly by approximately 17.5% as aresult of modal shift from truck transportation to coastaltransportation for shipment from Yokkaichi to Kitakyushu,
shortening of transportation distance in Japan by changing theport of discharge for imported parts, growth of tripartite
trades(Note 2) and other factors.(Note 3)

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.

Per Unit CO2 emissions by Year
98.6

100.0

(tons-CO2/100 million yen)

97.9

96.2

95.0

3.77

85.0

4.50

97.2

95.3

4.00
3.50

3.52

3.47

（％）
34.0

3.35

80.0

2.76

32.0

31.8

31.8

32.0

2013

2014

2015

32.8
31.1

31.0
30.0
0

2016

2017

Business Outline

90.0

Modal Shift Rate※ of the Sumitomo Electric Group by Year

33.0

(tons-CO2/million ton-km)

Basis for Management

We will continue the group-wide efforts to reduce CO2 emissions
from transportation.

(Fiscal year)

3.00(Note) Boundaries of data collection: Sumitomo Electric + 32 manufacturing companies
in Japan (excluding Sumitomo Wiring Systems, Ltd.)

2.50※ Modal shift rate (%) =Cargo transport by rail or ship (ton-km)
×100
Total amount of cargo transport in Japan (ton-km)

0

0

2013

2014

2015

2016

2017

(Fiscal year)

Sumitomo Wiring Systems, Ltd.
(Note 1) 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.
(Note 2) In a tripartite trade, an operator in a third country intermediates between the
supplier country and the destination country. This trade has no impact on CO2emissions in the third country because the goods are exported directly from the
supplier country to the destination country without going through the third country.

CO2 Emissions from Transportation

Sumitomo Wiring Systems, Ltd., an affiliate of Sumitomo
Electric, introduced a 21-meter full trailer truck forlong-distance transportation from the Suzuka and Yokkaichiarea in Mie Prefecture to Sayama City, Saitama Prefecture in
November 2017.

Conventionally, two 10-ton vehicles were used to deliver the
products collected at the five plants in the Yokkaichi and

Suzuka area to Sayama Storing & Shipping Center twice a day.

Now, the products are collected with different trucks and thenmoved to a full trailer truck, which transports the freight thatused to be carried with two 10-ton vehicles. With thisimprovement, the number of drivers required for the operation
was reduced from four to two, which helped address thecost were reduced by approximately 23% and 5%, respectively.

The introduction of full trailer trucks is also being planned fortransportation between Mie Prefecture and Miyagi Prefecture
and between Saitama Prefecture and Iwate Prefecture.

Social Contribution

shortage of truck drivers, and CO 2 emissions and operation

Core
Category

In light of the globalization of our business activities, we strive tocalculate data on CO2 emissions concerning transportation fromJapan to the ports or airports in the destination countries fordelivery of products to overseas destinations, the supply of raw
materials and parts to overseas affiliates and other export
activities.
At present, CO 2 emissions from our export activities wereapproximately 1.6 times higher than those from our transportation
activities in Japan and accounted for roughly 62% of the total
CO2 emissions from our transportation activities. About 78% of
the emissions from export activities were attributed tointernational air delivery.

Introduction of
a 21-meter Full Trailer Truck

Group's CSR Activities(Note 3) When the sales amount from tripartite trades is excluded from the total sales
amount, per-unit CO 2 emissions from Sumitomo Wiring Systems, Ltd. in ﬁscal
2017 are 3.31, a year-on-year reduction of 1.2%.

Sumitomo Electric has acquired certification as a company
engaged in the initiatives of Eco Rail Mark＊ from the Railway
Freight Association.

Governance

Sumitomo Electric Group (Sumitomo Electric + 32 manufacturing companies
in Japan (excluding Sumitomo Wiring Systems, Ltd.))

CO2 Emissions from Transportation in the Sumitomo Electric Group in FY 2017
Transportation in Japan

59,761t- CO2（61.9%）

Truck
33,863t- CO2（35.1%）■

International air
37,971t- CO2（39.3%）■

Sayama area

36,839t- CO2（38.1%）
FY ２０１7
Annual CO2
emissions96,600Ocean vessel
21,790t- CO2（22.6%）■

Suzuka/Yokkaichi
area■

Vessel in Japan
2,146t- CO2（2.2%）■

Air in Japan
12t- CO2（0.0%）■

2 times/day

Human Resources(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)NIPPON KONPOUNYU SOKO
CO., LTD.
Suzuka Center

Sumitomo Wiring
Systems, Ltd.
Sayama Storing &Shipping Center

Promotion of Modal ShiftEnvironmental
Preservation

Sumitomo Electric is active in promoting modal shift mainly inthe case of heavy and long-distance (500 km or longer) freighttransportation.
In fiscal 2017, the modal shift rate deteriorated due todecreases in railroad transportation to Miyagi Prefecture andcoastal transportation to Oita Prefecture from Osaka Works, inaddition to the reasons mentioned above.

Supply Chain

t-CO2

Railroad
817t- CO2（0.8%）

Quality

ExportNewly introduced 21-meter full trailer truck

Glossary ＊Eco Rail MarkA 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.

CSR Report 2018

68

Promotion of Resource Conservation and Recycling
Efforts to Achieve Zero Emissions andReduce the Amount of Waste (in Japan)

Amount of Waste by Type in FY 2017 (in Japan)
Waste landﬁlled or incinerated without heat recovery Total : 144 tons/year

We aim to manage waste in a proper manner

Waste plastics《 Promotion of Zero Emissions 》

Waste glass andceramics

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 sets the zero emission rate as theindicator for the efforts and works to meet the target of reducing
the rate to 0.3% or less.

Zero emission=
rate (%)

Amount of waste incinerated without heat recovery+ Amount of landﬁll waste
Amount of industrial waste+ Amount of general waste+ Amount of valuable materials

6
3
5

Waste paper

SludgeOthers

92

38

Heat recovery

7,682 tons/year

×100

Amount ofwaste

Material recycling

88,48931,709 tons/year(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.

tons/year

Valuable materials

48,954 tons/year

Amount of Waste and Zero Emission Rate (in Japan)
Amount of waste(thousand tons/year)

0.05
90

82.2

80

Zero emission rate (%)

0.04

0.03

79.3

81.4

48.4

48.8

70
60

48.0

50
40

0.10

73.3
43.3

0.2
0.03
81.6
44.2

0.3
0.2
0.1
0

88.5

Amount of recycled waste Total : 80,663 tons/year
Waste acid
Sludge49.0

Waste alkali
Waste plastics

30
20
10
0

34.1

30.9

32.5

30.0

0.0

0.0

0.0

0.1

2012

2013

Valuable materials
Zero emission rate

2014

2015

Recycled waste

37.3

39.4

0.0

0.1

2016

2017

Waste paper
Waste oil

Wood waste(Fiscal year)

Waste glass andceramics

Incineration and landﬁll wastes(Note) The boundary of data collection for valuable materials has been reviewed and part of
the waste metal generated outside of the facilities of the Sumitomo Electric Group
that used to be included in the boundary is not included from this ﬁscal year. Thischange has been retroactively applied to the data for ﬁscal 2015 and ﬁscal 2016 tocorrect the respective amounts of valuable materials for the two ﬁscal years. The
amounts of valuable materials without this change would be as follows:
FY2015: 47.0 thousand tons; FY2016: 48.0 thousand tons; FY2017: 52.7 thousand tons

《 Reduction of the Amount of Waste 》

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 reuse of thewaste generated by the company and reduction of waste volume.
In fiscal 2017, we failed to achieve the target with an increase in
the amount of the waste disposed of by outside contractors due
to troubles in the waste liquid treatment equipment. We willcontinue to make efforts with focus on the reduction of
unneeded materials generated through waste liquid treatment.

8,787
8,093
7,931
6,201
3,170
2,540
1,108
562
5,966

OthersReduction 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 fromthat in Japan, we work to refrain from landfilling industrial
waste without serious efforts and recycle waste to the extent
possible through separation of waste and other efforts tomaintain proper waste management.
Partly due to the fact that we also operate in countries where
the environment for recycling has not been developed, we
failed to meet the target with a zero emission rate of 9.1% in
fiscal 2017, which slightly exceeded the target.
Amount of Waste and Zero Emission Rate (Overseas)
Amount of waste(thousand tons/year)

Zero emission rate (%)

11.7

10.5

10.1

8.7

Waste Reduction Rate (Excluding Valuable Materials) in Japan

Amount of waste(excluding valuable materials)(thousand tons/year)

0

50
40

34.1

30

9.4
30.9

4.7
32.5

▲9.4
11.9
30.1

37.3

▲15.9
39.5

Reduction rate (%)

-20
-10
0
10
20

90
80

70
60
50

40

10

10

76.5

76.2

43.1

41.1

30
20

20

25.4

0

2012

0

2012 Base2013

Amount of waste

69 CSR Report 2018

2014

2015

2016

2017

Reduction rate from the ﬁscal 2012 level(Fiscal year)

36,306

Waste metal

81.8

86.2

44.4

46.4

29.1

26.2
8.9

8.1
2013

Valuable materials
Zero emission rate

2014

9.1

93.4

93.1

52.6

50.1

32.4

32.3
8.3

8.9

7.5
2015

Recycled waste

10
0

34.5
8.3

2016

20

8.5
2017 (Fiscal year)

Incineration and landﬁll wastes

Reduction of the Release of Harmful Chemical Substances

We have established an original system to unify
the management of chemical substances

other 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.

The aluminum alloy manufacturing facility and its exhaust gas

remain within regulated standards.

169
134
81

50

100

119

143

131

140

At present, the Sumitomo Electric Group produces no133

products using asbestos.

66

59

53

51

52

2012

2013

2014

2015

2016

2017 (Fiscal year)

Quality

63

0

2010

Release2011

Social Contribution

Dioxins. We have ensured that emissions from these facilities

Core
Category

Measures against Dioxins and Asbestos
subject to the Law Concerning Special Measures against

Release and Transfer (tons)

95

Itami and Yokohama) in August 2001. At those three Works andpurification facility at Sumitomo Electric Toyama Co., Ltd. are

Release and Transfer of Chemical Substances
Speciﬁed in the PRTR Law by Year100

We disclosed the pollution status of three major Works (Osaka,Group's CSR Activities

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 2017. Sumitomo Electric Group's total releaseand transfer of PRTR-designated substances in Japan were 52
tons and 133 tons, respectively.

150

We were committed to reducing the release of chemical
substances specified in the PRTR Law as an initiative of the
Action ECO-21 (Phase VI) Campaign from fiscal 2015 to fiscal
2017. In fiscal 2017, we made efforts to meet the target of
reducing the release by 5% from the fiscal 2012 level. We
worked to cut the atmospheric release in the sites that release 1
ton or more to the air in a year to reduce the annual release by
17.4% from the fiscal 2012 level to 51.7 tons in fiscal 2017,
which met the above-mentioned target.
From fiscal 2018, we will continuously strive to reduce therelease of chemical substances specified in the PRTR Law as an
initiative of the new Action ECO-22V Campaign.

Soil and Groundwater Remediation

The whole Group, including overseas affiliates,
is submitting reports in accordance with the applicable laws

200

We are committed to reducing the release ofchemical substances specified in the PRTR Law

GovernanceRelease and Transfer of Chemical
Substances Specified in the PRTR Law

Reduction of the Release of Chemical
Substances Specified in the PRTR Law

Business Outline

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.

Basis for Management

Chemical Substance Management System

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.

Chemical substanceReleaseInto water

Into soil

Into landﬁll

Total release

By sewage

Toluene

18.0

0.0

0.0

0.0

18.0

0.0

1,2-dichlorobenzene

4.8

0.0

0.0

0.0

4.8

0.0

Cresol3.2

ethanolamine

0.0

Lead

0.0

Phenol5.1

Formaldehyde

0.01-bromopropane

Copper salts(water-soluble, except complex salts)
Xylene37 other substances
Total

7.6
0.0
1.4
9.9

50.0

0.0
0.0
0.0
0.0
0.0
0.0
0.1
0.0
1.6

1.7

0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0

0.0

0.0

0.0

5.1

0.0

3.2

0.0

0.0

0.0

0.0

0.0

7.6

0.0

0.1

0.0

1.4

0.0

11.5

0.0

0.0

51.7

Transfer

By disposal
6.8

Total transfer

Total
amount

6.8

24.8

16.0

20.8

0.0

23.0

23.0

0.0

15.2

15.2

0.0
0.0
0.6
0.0
0.1
0.0
0.1
0.8

16.0
10.0
9.3
8.5
0.6
6.1
4.8

32.1

132.4

10.0

9.3
9.1
0.6
6.2
4.8

32.2

133.2

23.0
20.3
13.2
9.3
9.1
8.2
6.3
6.2

43.7

184.9

Dioxins

ReleaseTransfer

Into airInto water

Into soil

Into landﬁll

Total release

By sewage

By disposal

Total transfer

2

0

0

0

2

0

2

2

(Note) Boundary of data collection: Sumitomo Electric + PRTR obligatory companies among its aﬃliates in Japan

Total
amount4(Unit: mg-TEQ)

Environmental
Preservation(Unit: tons)

Chemical substance

Human Resources

Into airSupply Chain

Release and Transfer of Chemical Substances Speciﬁed in the PRTR Law

Glossary ＊ PRTR Law

Act on Conﬁrmation, etc. of Release Amounts of Speciﬁc Chemical Substances inthe Environment and Promotion of Improvements to the Management Thereof.

CSR Report 201870

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 affect theoperation of companies. Institutional investors and clientsrequire companies to respond to the problems to sustain theiroperation. In addition to the shortage of water supply,
water-related issues include deterioration of water quality,

flood damage, tightening of relevant government regulations
and relationships with communities in the neighborhood. The
Sumitomo Electric Group is working to understand the current
situation of these issues and taking measures to address them.

Establishment of an Organization to
Promote the Measures
We have started to evaluate water risks on a global scale
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 and relations with neighboring communities, on a
five-point scale. With the results of this evaluation based on
Aqueduct, we identified 32 production bases in Japan andoverseas with many high-risk items and surveyed them throughinterviews to understand the actual situation.
According to the answers from those 32 bases in the survey,

they were actually facing risks in an average of about 20% of
the items specified by Aqueduct as high risk. We also identified
cases that directly affected their operation such as inundation
into the plant site due to concentrated heavy rain, temporary
suspension of water supply due to water repair work or power

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.

Future Initiatives
We will promote activities involving the supply chain
Incorporating the concept of the CDP 2018 waterquestionnaire 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
The Sumitomo Electric Group added the reduction of water
consumption to its action items for the Action ECO-21
Campaign in fiscal 2008 and has actively worked for it sincethen. Our water consumption slightly increased year-on-year infiscal 2017 partly due to the growth of production in domestic
bases where a large volume of water is used. In terms of water
withdrawal by source, we take 86% of water from municipal
water and 14% from groundwater.
In the meantime, the destinations of the effluent are sewer
systems (63%) and rivers (31%) while 6% 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)

failure and abnormal water quality in an upstream area.

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 ourGroup based on the CDP 2018 water management
indicators. The questionnaire was then distributed to the 87
production bases in Japan and overseas selected as thetargets for the promotion of environmental activities and theiranswers were collected in March and April 2018.

Glossary ＊Aqueduct

71 CSR Report 2018

Reduction rate perunit of sales (%)

0
17.3
Water withdrawal(thousand m3/year)

14,00012,00010,000
8,000

23.2

24.0

18.2

0
5
10
15
20
25

24.9

12,172

11,835

12,381

12,665

12,921

13,102

5,957

5,757

6,466

6,764

6,955

6,928

6,215

6,078

5,915

5,901

5,966

6,174

2012
Base

2013

2014

2015

2016

2017

6,000
4,000
2,000
0
(Fiscal year)

Consumption in Japan
Consumption in other countries
Reduction rate per unit of sales(Note) Water withdrawal is calculated as the sum of the withdrawal of city water,industrial water and groundwater.

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.

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
environmental policy.

Our products are assessed to determine their levels of socialand 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.

By the end of fiscal 2017, a total of 275 items have beenregistered as Eco-products. The sales ratio in fiscal 2017
was 61%.

《 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, andBusiness Outline

environmentally conscious products as an initiative stated its

Basis for Management

Expansion of Environmentally Conscious Products

calculate the reduction effect.
The products contributed to the reduction of CO2 emissions
by a total of 126 thousand tons in fiscal 2017.
Percentage of Eco-Products in Sales and Contribution to
the Reduction of CO2 Emissions
Percentage of Eco-products in sales (%)

We perform environmental assessment of products whendeveloping new products, as well as when making major

70
60
50

design changes to existing products. The products having

40

products in the Sumitomo Electric Group.

20

undergone product assessment are registered as“Eco Mind”
By the end of fiscal 2017, a total of 923 items have beenregistered as“Eco Mind”products.

41

44

53

59
114

61
126

Contribution toemission reduction(thousand tonsCO2/year) 130
120
110

30
10
0

Governance《“Eco Mind”Products 》

100

59

63

90

78

80
70
60
50
40
30
20

《 Eco-Products (Eco Symbol Program) 》

outstanding environmental features are examin e d inaccordance with our Eco Symbol Program, which is based on
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.

10
0

2013

2014

2015

2016

2017

(Fiscal year)

・ Calculation method
The percentage of Eco-products in sales is calculated as the value ofthe shipments* of the 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.)
For methods to calculate the contribution to the reduction of CO2 emissions,see“Examples of Eco-Products”below.

Core
Category

Examples of Eco-Products
Contributing to energy saving in basestations with compound semiconductor
power amplifying elements

CELMET TM (porous metal)

GaN HEMT

Sumitomo Electric Device Innovations, Inc.
The contribution is calculated by estimating
the reduction of CO2 emissions achieved ata base station in accordance with the criteria
set by Sumitomo Electric.

Contributing to the improvementof fuel eﬃciency of cars bytrimming the weightContributing to resource savingby extending the service life

The contribution is calculated by estimating
the amount of CO 2 emissions reduced by
improvement of fuel eﬃciency of a carachieved by reducing the weight in accordancewith the criteria set by Sumitomo Electric.

Sumitomo Electric Hardmetal Corp.
The contribution is calculated by estimating
the amount of the resources saved and CO2
emissions reduced from the production inaccordance with the criteria set by
Sumitomo Electric.

Supply Chain

Sumitomo Wiring Systems, Ltd.

Cemented carbide tools
with longer service life

Quality

The contribution is calculated by estimating
CO2 emissions reduced with a hybrid car inaccordance with the criteria set by
Sumitomo Electric.

Lightweight wire harness

Social Contribution

Contributing to the improvementof fuel eﬃciency of hybrid cars aselectrodes of secondary batteries
Sumitomo Electric Toyama Co., Ltd.

Group's CSR Activities

Among“Eco Mind”products, the products with particularly

Human Resources

Contributing to the improvement of
productivity of processed materials
and fuel eﬃciency of automobiles

Sintered products

Sumitomo Electric Sintered Alloy, Ltd.

Environmental
Preservation

The contribution is calculated by estimating
the amount of CO2 emissions reduced in the
production of the processed materials and in
the use of oil pumps in accordance with thecriteria set by Sumitomo Electric.

CSR Report 201872

Promotion of CSR Activities in Aﬃliates

Sumitomo Rubber Industries, Ltd.

Web

http://www.srigroup.co.jp/english/csr/

This Basic Philosophy is composed of a CSR Philosophy
and CSR Guidelines. Our CSR Philosophy proclaims that,through our CSR activities, the Sumitomo Rubber Groupwill aim to become a corporate group that earns the trustof society such that our continued existence is always
viewed as a positive thing. 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 theenvironmental impact of our business activities), Next (asin next-generation product development), Kindness (as inkindness to employees and others) and Integrity (as inintegrity for all stakeholders). Put together, thesecomponents spell out the word“GENKI”(Japanese for

Dunlop Nationwide Tire Safety Checks
Conducted as Part of "Integrity" Initiatives“energetic”) in reference to the Group's GENKI Activities,
which is a separate initiative that we launched in 1988
with the aim of energizing employees.

Sumitomo Rubber Industries created the Sumitomo

Based on the basic philosophy and guidelines behind our

Rubber Group's Basic CSR Philosophy in 2008 in the belief

CSR activities, the Sumitomo Rubber Group is working tothat it is necessary to establish a clear code of conduct for

create new value throughout our business activities by

the Group's overall CSR activities while further

developing and implementing new and unique CSR

accelerating the shift to a management style that actively

activities with the aim of further enhancing our social value

pursues greater social value.

and, by extension, our economic value.

Sumitomo Wiring Systems, Ltd.

Web

https://www.sws.co.jp/en/csr/index.html

international competition of boccia, a sport designed for
persons with disabilities, for the first time in Japan and we
supported the competition held in March 2018 as an official
sponsor.
Other CSR activities included the continuance of free loan of
welfare vehicles to a specified nonprofit organization in theneighborhood, encouragement of employees to participate insports events for persons with disabilities and participation in
the operation of such events as volunteers. We will continue
to give active support for the promotion of the understandingof persons with disabilities and for their independence andsocial participation.
As our initiatives for regional revitalization through the

The 100th Anniversary Celebration Concert of
Sumitomo Wiring Systems, Ltd.

promotion of sports, we gave support to PEARLS, a local

Sumitomo Wiring Systems celebrated the 100th anniversary ofclimbing, which is an official event at the 2020 Tokyo Olympic

its founding in December 2017. In commemoration of it, we
held various events to express our gratitude to the local
community. One of them was a concert by a violinist from
Yokkaichi City with a symphony orchestra organized in July.
We invited 1,700 residents in the region for free to express
our gratitude to the local community as well as to contributeto the promotion of local arts and culture. We received
positive comments from many visitors.
Mie Prefecture, in which we are based, successfully invited an

73 CSR Report 2018

women's rugby team, including the assistance of the players intheir employment, and have recruited one athlete of sport
Games. We will make social contributions throughsport-related initiatives including support of athletes andpromotion of sports as mentioned above.
Toward the next 100 years, Sumitomo Wiring Systems willcontinue to contribute to society through the delivery of safe,
convenient and environment-friendly cars to as manycustomers as possible and actively promote social
contribution activities to become a company rooted in theregion and loved by local people.

Sumitomo Riko Company Limited

Web

https://www.sumitomoriko.co.jp/english/csr/

are positioned as activities that help meet society's
challenges. In line with social demand, we have specified
five priority areas for the activities, namely diversity, thesound development of young people, building community,
civil activities and the promotion of coexistence with thenatural environment, and implement various activities inthose fields.
As an initiative for contribution to "building community,"
we organized the "Sumitomo Riko Emergency Medical
Care Experience Fair in APiTA Komaki Store" in as h o p p i n g mall for the public last year. Our product"Shinnosuke-kun," a training and evaluation system forchest compression, was used in this event to make theEmergency Medical Care Experience Fair
organized in APiTA Komaki StoreThe Sumitomo Riko Group considers that social
contribution activities generate social values and also help
improve corporate values. With our slogan "Along with
You, Together with Society," which symbolizes the social
contribution of our Group, we are actively conducting
social contribution activities to become a company thatmoves forward in harmony with society.
We aim to make value-creating social contributions, which

Nissin Electric Co., Ltd.

need and effect of basic life support known to people,
including those who are not interested in it, and provide
them with an opportunity to experience critical care inorder to thereby save as many lives as possible. We held
this unique event directly related to our business incollaboration with wide-ranging members of the local
community such as other companies, public bodies andcitizen groups.
We will continue our social contribution activities to be acompany that is appreciated by the local community.

Web

http://nissin.jp/csr/index.html

three areas of "Support of the development of engineers,""Preservation of historical and cultural assets mainly in Kyoto"and "Cooperation with local environmental conservation
activities."
We are especially committed to the development of humanresources who will lead the next generation with an idea thatengineers who create innovations are essential for thecontinuous growth of the Japanese industry.
One of the initiatives is an on-site science class, which aims tohelp more elementary school students develop an interest inscience. In the classes, students generate, store and use
electricity by themselves using a "hands-on eco-power
generation system," a new learning material developed andcreated jointly by our group companies. This system includes
experiences generating electricity with solar panels and by

On-site science classes forelementary school students to learn with joy

pedaling, and riding in a solar car. We provide the students
with an opportunity to think of the effective use of renewableenergy through the classes.
In addition, to support the research activities of talented

Principles of Activities of the Nissin Electric Group are"Integrity, Trust and Long-term Relationships." Through thecorporate activities that solidify the trusts with stakeholders
and support social and industrial foundations, we are aiming
to help create a vibrant society in harmony with theenvironment. Our group is making concerted efforts topromote various social contribution activities with focus on thestudents who are ambitious to learn advanced technologies,
the Nissin Electric Group Foundation for Social Contribution
provides scholarships for technical graduate students studying
to be an engineer/researcher.
Through these initiatives, we will contribute to thedevelopment of human resources that support the industry of
the future.

CSR Report 201874

Independent Third Party Assurance Report

75 CSR Report 2018

Comments from an External Expert

My ﬁndings from CSR Report 2018 (hereinafter "this Report") on Sumitomo Electric Group’ s activities and eﬀorts to
fulﬁll their social responsibility, and disclose relevant information, are as follows:

Changes of the times and what is expected of
the Sumitomo Electric GroupThe opening of Top Message in this Report mentions that
consolidated net sales, operating income and proﬁt attributableto owners of the parent were all record highs in ﬁscal 2017. Afterseeing results, I am convinced that the business activities of theSumitomo Electric Group are responding accurately to the needsof the times.
In addition, when the future outlook is considered, the eﬀorts of
the industrial world to ensure sustainability of the global
environment and society such as promotion of activities to meetdemand for CASE (Connected, Autonomous, Shared, Electric)
and growth of environment-friendly vehicles in the automobile
industry, as well as implementation of large international
interconnector projects and progress in the use of renewableenergy in the power industry, will also provide new business
opportunities for the Sumitomo Electric Group. I expect that theGroup serves as a leader in responding to such changes of thetimes.
Meanwhile, it was diﬃcult from this Report to understand "thevision of the society that the company aims to achieve" or "thewill of the company to lead the changes" probably because it is anature of a B-to-B company. I hope that the next report will show
a stance to "build a sustainable future through business activities"
more clearly.

Aspects needing improvement■ Information for evaluating the eﬀectiveness ofinternal control

In recent years, quality data falsiﬁcation and other scandals haveoccurred frequently in Japanese companies. Conventional
initiatives like campaigns to reduce defects would not prevent
such cases eﬀectively. The key to preventing such cases isinternal control systems in place to detect, correct and prevent
willful acts attempting to cover up or alter information. While itis not easy to present the eﬀectiveness of internal control toexternal stakeholders, I paid attention to the article on the
Speak-Up System in this Report as the number of consultations
has continued to increase in recent years. I suggest that the
Sumitomo Electric Group consider the disclosure of the
background factors, the contents of the consultations and therecords of the issues that have been solved.

large as more than 210,000, data on overseas business bases
are essential to understanding the entire picture of the Sumitomo
Electric Group. The situation in the overseas bases was not easy
to understand in some sections of this Report including thearticles on occupational accidents, quality-related activities,
working hours and health and productivity management. I
suggest that the Sumitomo Electric Group consider expanding
and improving the disclosure of the activities of overseas
business bases and their results.
■ Concept of backcasting and setting of targets

This Report explains that the target of reducing greenhouse gas
emissions by 5% from the ﬁscal 2012 level on a global scale was
not met and the reduction stayed 2.3% because the sales
increased by about 20% over the ﬁve years. In recent years, on
the other hand, the concept of setting targets from theperspective of environmental restrictions has emerged in theworld, as exempliﬁed by the diﬀusion of new ways of addressing
climate change such as the introduction of two-degree goal andcarbon budget, as well as the incorporation of "Zero Challenge"(aiming to have practically no environmental impact) or "RE100"(meeting all energy demand with renewable energy) into targets
in some Japanese companies. I suggest that the Sumitomo
Electric Group also consider a way to reestablish the businessportfolio that consists with a decarbonized society from along-term viewpoint.
■ Response to new challenges

As a recent problem, marine pollution by microplastics has been
rapidly attracting attention. Products of the Sumitomo ElectricGroup such as wiring harnesses and ﬂuororesin products canalso be related to the problem. In developing countries, improper
disposal of wiring harnesses in discarded cars, such as open
incineration, is causing health damage. It is also indicated thatthe sites for mining cobalt and other rare metals still involve
harsh working conditions and child labor. I suggest that the
Sumitomo Electric Group consider initiatives to proactively
address emerging problems in scope of the entire value chain.

■ Disclosure of the contents and results ofactivities in overseas business bases

Sumitomo Electric has 280 overseas aﬃliates with an overseas
employee ratio of 84.5% and an overseas sales ratio of 59.7% asof ﬁscal 2017. Since the total number of employees is also as

Eiichiro AdachiCounselor,
The Japan Research Institute

Sumitomo Electric's Response to the Findings

Yoshitomo Kasui

Senior Managing Director
and Chairperson of
the CSR Committee

We thank Mr. Eiichiro Adachi for providing suggestive opinions on our Group's activities to fulﬁll our social responsibility andinformation disclosure. We are humbled by his great expectations on us, such as an expectation that we play a leading rolein meeting the changes of the times.
In the Sumitomo Spirit, which has been inherited as the basic value standards for the Sumitomo Electric Group since its
foundation, one of the traditional beliefs and principles is "long-range planning." This indicates that business developmentwith a future-looking and long-term view, complemented by a wider perspective to secure national and social interests, is
one of the factors that have made Sumitomo distinctive. While a basic concept in our new mid-term management plan
VISION 2022 is "Contributing to a better society by leveraging our expertise in connectivity and transmission technologies
through concerted eﬀorts of the entire group" to become a Glorious Excellent Company, which is our ideal state, thecomments from Mr. Adachi made us conﬁrm that we are in the right direction.
Mr. Adachi's indications include great issues that should be addressed in an independent business with time and care. Still,
we will consider each of the challenges and further enhance our activities to contribute to a better society and environment
based on the basic value standards. While also helping achieve the Sustainable Development Goals, we will continue tofurther develop our CSR activities so that our stakeholders enhance their understanding of our activities and attach a higher
value to them.
The Findings by an External Expert in this English version are a translation of the original text in the Japanese version.

CSR Report 2018

76

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［Published November 2018］