Revision History
Dec. 23 2020

First Edition

JFE GROUP CSR REPORT 2020

Contents
1
4
6
17
22
29
37
39
46
61
63
74
90
95
100
103
106
109
111
117
124
134
135
138
147
149
158
161
164
165
187
192
197
198
201
204
207
210

Message from the CEO
JFE Group VisionCorporate Vision/Business Conduct
JFE Group Value Chain
Value of SteelCSR Management
Material CSR Issues
CSR Structure
Supply Chain Management
Environment
Environmental Management
Development and Provision of Eco-friendly Processes and Products
Material Flow
Climate Change (Climate Change Mitigation)
JFE Group’s Response to the TCFD
Steel Industry Initiatives
Prevention of Pollution (Protecting the Global Atmosphere and Water)
Efficient Use of Resources (Resource Recycling)
Water Security (Conservation of Water Resources)
Biodiversity (Initiatives to Preserve Biodiversity)
Environmental Communication
SocialCustomer Responsibility (Provide Quality Products and Enhance Customer Satisfaction)
Occupational Health and Safety
Labor Standards (Recruit and Nurture Diverse Human Resources)
Action Plan based on the Act on Promotion of Women’s Participation andAdvancement in the Workplace
Human Rights (Respect for Human Rights)
Community
Shareholders and Investors
GovernanceCorporate GovernanceCompliance (including Anti-corruption)
Risk Management
Tax Transparency
ESG Data
Environmental Data
Social Data
Governance Data
Independent Assurance Statement
External Evaluations and Awards
External ESG Evaluations
External Awards
Third-party Comments
Editorial Policy
Guideline Content Indices

JFE GROUP CSR REPORT 2020

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Message from the CEO

September 2020

Koji Kakigi

Representative Director, President and CEO of JFE Holdings, Inc.

Contributing to the Creation of a Sustainable Society by Leveraging theWorldʼs Most Innovative Technology to Resolve Climate Change Issues andAddress Other Global Challenges
Where We Stand and What We Intend to Do
The JFE Group is committed to its corporate vision, “contributing to society with the world’s mostinnovative technology,” and by leveraging its comprehensive strengths gained through a broad range ofbusinesses centered on iron and extending to steel, engineering, and trade, it has provided solutions
that contribute to the sustainable development of society amid a rapidly changing businessenvironment.
We face a severe economic environment as the US-China trade dispute, which has persisted sincelast year, along with other global trends toward protectionism, become more deeply entrenched,leading to stagnating steel demand and falling export steel prices. At the same time, the price of ironore remained high as China expands its crude steel production, making it difficult for us to secure profit.
Moreover, given the declining birthrate, an aging society, and falling population in Japan, we expect
steel demand to decline over the medium to long term. In addition, the current global pandemic of
COVID-19 has restricted economic activities around the world. The resulting sharp plunge in the global
economy and slowing economic activities in Japan represent unprecedented challenges.

JFE GROUP CSR REPORT 20201

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
I believe the JFE Group must flexibly and effectively adapt to these immense changes in thebusiness environment and demonstrate two qualities of sustainability: economic sustainability bycreating economic value through sustainable growth and environmental and social sustainability bycontributing to the resolution of social issues. We must become a resilient enterprise capable ofconsistently providing value over the long term.

Becoming a Truly Strong Enterprise through Efforts to Restructure the Steel Business and Address
Climate Change
Given the continued uncertainty and severe environment, we have decided to take action on structuralreform to create an optimal production framework within Japan. In our steel business, we will halt one
blast furnace at the East Japan Works as part of our attempt to build a strong business structure
capable of generating stable profit under any circumstances. At the same time, we will actively promote
our ESG initiatives in environmental, social, and related aspects by positioning 2020 as the turning point.
As an enterprise engaged in iron and steel manufacturing, which is associated with emitting massive
volumes of CO2, the issue of climate change is a critical managerial concern from the perspective of
business continuity. In May 2019, the JFE Group endorsed the final recommendations report releasedby the Task Force on Climate-related Financial Disclosures (TCFD) in 2017, which called for disclosing
such information as a company’s climate change strategies, and we included information such as our
scenario analysis in our CSR report issued in September 2019. Our steel business, which emits 99.9%of the Group’s total CO2 emissions, has been developing various technologies for saving energy andreducing CO2 emissions. Applying these to steel manufacturing has successfully reduced CO2 emission
intensity to the lowest level worldwide. In our disclosures consistent with TCFD recommendations, we
explained our progress in developing innovative iron-making processes such as COURSE50 and ferrocoke as well as our initiatives to realize zero-carbon steel. We also described our broad contributions toaddressing climate change by explaining how we are reducing CO2 emissions through the construction
and operation of renewable energy plants in our engineering business and responding to the promotionof national resilience across the three business domains.
In 2020 the JFE Group set two ambitious targets: (1) reduce CO2 emissions in fiscal 2030 by 20%

or more compared to fiscal 2013 in the steel business, which accounts for most of the JFE Groupʼs
CO2 emissions, and (2) strive to be carbon neutral within the JFE Group as soon as possible after
2050, in line with the social transformation to establish carbon-free infrastructure over the long term.
With regard to the aforementioned structural reorganization of the steel business, we are trying toenhance economic sustainability by becoming a slim, stronger company with higher profitability. At thesame time, by reinforcing initiatives against climate change, we intend to improve environmental
sustainability, a critical concern the Group faces in its various ESG-related challenges. We plan toincrease overall and sustainable corporate value through these efforts. This year will be the turning
point for our business based on having made these major decisions, and we will take our first big step
forward.

Risk Response in the Value Chain and Follow-up on KPIs to Resolve Material CSR Issues
In order to maintain the sustainability of the Group as a whole, it is extremely important to recognize
the CSR challenges of the Group’s global business and respond to the associated risks andopportunities. In this report, we treat our steel, engineering, and trading companies as well as all our
stakeholders including suppliers and clients as a single value chain and organize and examine CSR
challenges associated with each of them, particularly to confirm that we have not overlooked any risks
or responses.

JFE GROUP CSR REPORT 20202

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
From the perspective of diverse stakeholders, the JFE Group has identified material CSR issues in
the Group’s business activities and set up KPIs for each operating company as a means of evaluatingeach of their initiatives. In FY2019, along with disclosing the initiatives, results, and evaluations of theprevious year, we partially revised the KPI to strengthen initiatives to be taken during and after FY2020.
The new KPIs will clarify the positioning of each material issue in management terms while ensuringthat they are appropriate indices for measuring achievement and progress. They are also quantified
insofar as possible to allow efficient implementation of PDCA cycles. Going forward, we will continue
to regularly review each issue as well as the appropriateness of each index and enhance theireffectiveness to further reinforce CSR management and strengthen the Group’s sustainability.

Contributing to the Sustainable Development of Society
A female full-time Audit & Supervisory Board member was appointed at the JFE Group in 2019,
followed by the appointment of the first female outside director in June 2020. We expect that theexchange of diverse opinions will enhance in achieving effective Group governance. We are also
actively hiring female employees and mid-career talent to maximize the potential of employees withdiverse values and background.
Under the JFE Group’s corporate vision of contributing to society with the world’s most innovativetechnology, we will deliver solutions that leverage our comprehensive strength and thereby strive tomaintain the Group’s sustainable growth, increase our corporate value, and ensure the development ofa sustainable society.

JFE GROUP CSR REPORT 20203

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Corporate Vision/Business Conduct
The JFE Group’s corporate values and standards ofbusiness conduct are manifested in the company’s vision ofcontributing to society with the world’s most innovativetechnology. We proactively address critical issues regarding
safety, disaster prevention, product quality, human rights,
compliance, environmental protection and climate change.
The JFE Group considers the perspectives of all
stakeholders, including customers, clients, shareholders,investors, community residents and employees, guided by afair, objective and transparent system of corporate
governance. In the spirit of its corporate values of
Challenging Spirit, Flexibility and Sincerity, the JFE Group
strives to earn society’s trust by undertaking CSR withintegrity.

JFE Group Standards of Business Conduct
All JFE Group personnel are required to faithfully adhere to the following Standards of Conduct in all
corporate activities. These standards embody the JFE Group’s Corporate Vision and go hand in handwith its Corporate Values.
Senior managers are responsible for communicating these standards to employees of Group
companies and their supply chain partners, and in creating effective systems and mechanisms toensure adherence to ethical standards.
Senior managers are also responsible for measures to prevent the recurrence of any violation ofthese standards. Additionally, they must report violations promptly and accurately to internal andexternal stakeholders, determine the persons of relevant authority and accountability, and resolve
matters rigorously.
1

Provide quality products and services
Earn the trust and acclaim of customers by endeavoring to provide safe, high-quality
products and services based on superior technologies, and by fully respecting andprotecting the privacy of personal and customer information. Also, leverage our superior
technologies for the sustainable growth of our Group and society.

2

Be open to society
Disclose corporate information actively and engage in constructive dialogues with diverse
stakeholders to enhance our corporate value.

3

Work with communities
Actively contribute to host communities as a good corporate citizen by emphasizing
harmony and cooperation.

4

Globalize
Endeavor to achieve understanding with people around the world, working from a global
perspective and with respect to international norms, and also local cultures and customs.
JFE GROUP CSR REPORT 20204

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）5

Exist harmoniously with the global environment
Actively work to exist harmoniously with the global environment, as well as to raise living
standards and advance societies.

6

Maintain proper relations with governments and political authorities
Endeavor to build and maintain sound and proper relationships with governments andpolitical authorities.

7

Maintain crisis readiness
Firmly resist all elements and organizations that threaten social order and stability, andrefuse all illegal or improper demands. Also, contribute to order and safety in society bythoroughly and methodically preparing for crises such as terrorism, cyberattacks, natural
disasters and others, including by ensuring the stable availability of products and services.

8

Respect human rights
Respect all employees and members of the general public as individuals and refrain fromany discrimination in corporate activities.

9

Provide challenging work environments
Provide employees with attractive, safe, healthy and challenging work environments.

10Comply with laws and ordinances
Comply with all applicable laws and ordinances, endeavor to compete fairly and freely,
refrain from illegal business activities, promote sound business practices, and be faithfuland sincere in all activities and dealings.

JFE GROUP CSR REPORT 20205

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Group Value Chain
The JFE Group’s value chain encompasses upstream and downstream activities across the globe. In
conducting business, we seek to accurately identify and steadily respond to: (1)*1 the social
challenges that the Group needs to address and (2)*2 the risks and opportunities that the Group must
resolve through its business operations.
We will continue to implement further countermeasures throughout our value chain and strengthen
the sustainability of the entire Group.

*1: Corresponds to social challenges in the Overview of the Value Chain*2: Corresponds to risks and opportunities in the Overview of the Value Chain

Steel Business and Trading Business

Overview of the Value Chain

Procurement

Suppliers

Local communities near suppliers

To ensure stable supply of iron ore and coal used as raw materials in the production of steel products,
we purchase from various sources around the world such as Australia, North and South America,
Russia, and Africa and transport materials to the steelworks on a special vessel. Equipment andmaterials used at steelworks plants are also purchased globally.
● Social◆ Environment

JFE GROUP CSR REPORT 20206

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Social Challenges● Exercise fair procurement● Complete abolition of child labor andforced labor● Prohibit the use of conflict materials● Respect human rights● Implement workstyle reform◆ Transition to decarbonized society (climatechange actions)◆ Conservation of natural resources

Risks<Common><Raw material: iron ore>

● Occurrence of accidents, including
industrial accidents● Potential human rights risks● Labor risks◆ Disruptions to the supply chain causedby climate change-related disasters,
natural disasters such as earthquakes,
and COVID-19◆ Increased environmental impact (rawmaterial procurement)

Opportunities●◆<Raw material: coal>◆ Increased environmental impact (rawmaterial procurement)◆ Introduction of a carbon tax<Machinery>◆ Increased environmental impact (machineryprocurement)

Develop a system to ensure stableprocurement by expanding CSR procurement

Initiatives●◆●

Publicly release information on thePurchasing and Procurement Policies
to suppliers and request that they takeactionConfirm that suppliers are not using
conflict materials◆ Reduce CO2 emission during transportation by
improving logistics efficiency◆ Secure an alternative source of supply anddistribute<For more information:>
Supply Chain Management (P. 37)

JFE Group’s Response to the TCFD (P. 74)

JFE GROUP CSR REPORT 20207

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Manufacturing, Production, and Shipping
Employees

Local communities near manufacturing sites

The JFE Group is one of the world’s largest steelmakers and has cutting-edge technologies for theefficient production and stable supply of high-quality steel products, used in products indispensable todaily life such as automobiles, infrastructure, and home appliances. We also promote resource
recycling by recycling steel scrap generated in the process of producing steel products while also
repurposing iron and steel slag in cement and other construction materials.
● Social◆ Environment

Social Challenges●●●●

Ensure occupational health and safety
Provide stable supply of products
Ensure quality
Achieve co-existence and mutual
prosperity with local communities● Respect human rights● Implement workstyle reform● Ensure information security◆ Transition to decarbonized society (climatechange actions)◆ Conservation of natural resources◆ Reduction of waste◆ Prevention of water resource exhaustion

Risks● Lose credibility with customers due toissues related to production andquality● Culture of passing down technicalskills is dying out● Occurrence of accidents, including
industrial accidents● Potential human rights risks● Labor risks● Labor shortage● Cyber security risks◆ Physical and transitional impact of climatechange (CO2 emissions, water risk, etc.)◆ Heightened decarbonization needs in iron andsteelmaking process◆ Risk of floods associated with rising sea levels◆ Risk of drought in the water intake area, risk ofpollution in the discharge area
◆ Shortage of disposal sites for waste generated
by facilities and offices◆ Tighter environmental regulations

Opportunities● Ensure competitiveness throughstable production and stable quality● Construct favorable relationships withlocal communities● Secure excellent human resources
through workstyle reform◆ Expand electric furnace steelmaking andelectric furnace engineering businesses◆ Develop eco-friendly innovative technologies
and ensure competitiveness

JFE GROUP CSR REPORT 20208

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Initiatives● Testing, inspections and quality audits● Strategic investment and renovation offacilities including R&D● Production site tours for stakeholders◆ Increase the efficiency of the iron andsteelmaking process, develop andintroduce super innovative technology◆ Develop eco-friendly products◆ Develop and install energy-saving equipment
for environmental protection◆ Recycle industrial water by water purification◆ Conduct 3R (reducing, reusing, and recycling)
activities◆ Implement measures against flood anddrought

For more information:
Environmental Management (P. 39)
Development and Provision of Ecofriendly Processes and Products(P. 46)
Climate Change (P. 63)
JFE Group’s Response to the TCFD
(P. 74)

Sales and Usage

Employees

Efficient Use of Resources (P. 100)
Water Security (P. 103)
Customer Responsibility (P. 111)
Community (P. 138)

Customers

The JFE Group is committed to developing eco-friendly products such as high tensile strength steel
sheets that help reduce the weight of automobiles as well as electromagnetic steel plates used inelectric vehicles. We support the frontier of production by responding to the diverse needs of different
industries through research and development and by improving production technologies.
● Social◆ Environment

Social Challenges● Compete fairly● Respect human rights● Implement workstyle reform● Ensure information security◆ Transition to decarbonized society (climatechange actions)◆ Conservation of natural resources

Risks● Legal risks such as violations ofantitrust law or competition law● Occurrence of accidents, including
industrial accidents● Potential human rights risks● Labor risks● Cyber security risks◆ Increased environmental impact during
product use

JFE GROUP CSR REPORT 20209

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Opportunities● Secure excellent human resources
through workstyle reform◆ Renewed interest in recyclability ofsteel◆ Contribute to reduced CO2 emissions byproviding high-performance steel such as hightensile strength steel sheets andelectromagnetic steel plates

Initiatives● Conduct compliance training◆ Reduce CO2 emissions during productuse◆ Promote a shift in transportation modes◆ Provide eco-friendly products<For more information:>
Climate Change (P. 63)
Development and Provision of Ecofriendly Processes and Products(P. 46)

Collecting Steel Scrap

Employees

Compliance (including Anti-corruption) (P. 158)

Customers

Society

Steel products at the end of their product life cycle are collected as steel scrap and recycled asmaterials for the steel production cycle.
● Social◆ Environment

Social Challenges●●●◆

Respect human rights
Implement workstyle reform
Ensure information security
Transition to decarbonized society(climate change actions)◆ Conservation of natural resources◆ Prevention of resource depletion◆ Increase the volume of scrap generated

Risks● Occurrence of accidents, including
industrial accidents● Potential human rights risks● Labor risks● Cyber security risks◆ Decline in the grade of obsolete scrap◆ Rising price and difficulty of obtaining obsolete
scrap

JFE GROUP CSR REPORT 202010

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Opportunities◆ Increased use of scrap◆ Expand the scrap distribution businessInitiatives◆ Efficient transportation for collecting
steel scrap◆ Efficient use of resources based on increased
use of scrap<For more information:>
Climate Change (P. 63)

Efficient Use of Resources (P. 100)Engineering Business

Overview of the Value Chain

Engineering (Creating the Foundations for Daily Life)
The JFE Group has built many high-functioning, high-quality facilities in fields such as energy, theenvironment, and bridges while satisfying the needs of our customers every step of the way, fromdesign to delivery. We have combined and evolved the technologies for processing and assembling in
shipbuilding business and technologies relating to materials and combustion in the steel business tocreate next-generation energy and to address environmental issues. Many of our technologies support
society. In addition, we are assembling our resources to develop new business models and newtechnologies based on existing technologies. We produce high-quality products at low cost by
establishing production sites, including one of the largest steel structure production factories in Japan,
overseas bases centered on Asian countries, and global engineering structures.
JFE GROUP CSR REPORT 202011

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

Planning, Development, and Design● Social

SocialEmployees

Governance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesCustomers◆ Environment

Social Challenges● Maintenance of social infrastructures,
aging of facilities● Disaster prevention and mitigation,national resilience● Respect human rights● Implement workstyle reform● Ensure information security◆ Transition to decarbonized society (climatechange actions)◆ Resource restriction◆ Conservation of natural resources◆ Reduce waste plastic◆ Reduce food waste

Risks● Lose credibility with customers due toissues related to production and quality● Potential human rights risks● Labor risks● Labor shortage● Cyber security risks◆ Tighter environmental regulations

Opportunities
●◆
●◆
●
◆
◆

Implement requested functions
Need for cost reduction and energy
savingExpand ESG investment
More sophisticated needs in theenergy-environment area
Increased need for renewable energy
solutions◆ Increased demand for CCU/CCS facilities◆ Increased response to climate change related
disasters (disaster prevention and mitigation,
disaster waste processing)◆ Increased demand for plastic recycling◆ Increased demand for food waste power
generation

Pursue research and development
Design products that meet quality
requirements, regulations, cost
reduction, and energy-saving
requirements
Deliver solutions that meet customer
needs● Secure competitiveness by creating a new
business model that contributes to addressing
social problems (plastics and food products)● Use big data and AI in design◆ Plan for construction and operation of a power
plant that utilizes renewable energy as well as
the sales of electricity

Initiatives
●◆
●◆

●

<For more information:>
Development and Provision of Eco-friendly
Processes and Products(P. 46)
Climate Change (P. 63)

Customer Responsibility (P. 111)
Business Model (JFE GROUP REPORT 2020 pp.
19–20) (https://www.jfeholdings.co.jp/en/investor/library/group-report/)

JFE GROUP CSR REPORT 202012

Message fromthe CEO

JFE Group
VisionProcurement● Social

CSR
Management

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Suppliers◆ Environment

Social Challenges● Fair procurement● Complete abolition of child labor andforced labor● Respect human rights● Implement workstyle reform● Ensure information security◆ Transition to decarbonized society (climatechange actions)◆ Conservation of natural resources

Risks
●
●
●
●

Potential human rights risks
Labor risks
Labor shortage
Cyber security risks◆ Increased environmental impact (material
procurement)◆ Disruptions to the supply chain caused byclimate change-related disasters, and natural
disasters such as earthquakes◆ Risk of drought in the water intake area, risk ofpollution in the discharge area

Opportunities●◆

Development of stable procurement
though expansion of CSR procurement.

Initiatives●◆●◆

Making public the procurement policy
and requesting the commitment of
suppliers
Requesting suppliers to take action in
CSR initiatives◆ Promote green procurement<For more information:>
Supply Chain Management (P. 37)

JFE Group’s Response to the TCFD (P. 74)

JFE GROUP CSR REPORT 202013

Message fromthe CEO

JFE Group
VisionCSRManagement

Production and Construction● Social

Environment

SocialEmployees

Governance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Business associates◆ Environment

Social Challenges
●
●
●
●
●

Ensure quality
Ensure occupational safety and healthRespect human rights
Implement workstyle reform
Ensure information security◆ Transition to decarbonized society (climatechange actions)◆ Conservation of natural resources◆ Issues regarding waste reduction◆ Preserve living environments

Risks● Culture of passing down technicalskills is dying out● Occurrence of accidents, including
industrial accidents● Potential human rights risks● Labor risks● Labor shortage● Cyber security risks◆ Effects of meteorological disasters◆ Violation of environmental regulations andlaws◆ Environmental accidents◆ Pollution of the environment

Opportunities● Saving labor through new technology

Initiatives● Introduce a labor-saving construction
method◆ Promote waste recycling<For more information:>
Efficient Use of Resources (P. 100)

JFE GROUP CSR REPORT 202014

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Business Operation/Operation Support(Bearing the Responsibility of Supporting Daily Life)
The JFE Group engages in many private-public initiatives in the field of public services by applying theoperational and maintenance know-how acquired over many years, primarily with regard to theenvironment and water and sewage plants. Furthermore, we build plants, engage in the recycling
business and renewable energy business, and take the initiative to realize a recycling-oriented
sustainable society. Going forward, we intend to expand our initiatives even further.

Maintenance and Operations● Social

Employees

Customers◆ Environment

Social Challenges
●
●
●
●
●
●

Improve productivity
Disaster prevention and mitigation
Ensure occupational safety and healthRespect human rights
Implement workstyle reform
Ensure information security◆ Transition to decarbonized society (climatechange actions)◆ Reduce CO2 emissions◆ Conservation of natural resources◆ Issues regarding waste reduction

Risks● Cyber security risks● Culture of passing down technicalskills is dying out● Occurrence of accidents, including
industrial accidents◆ Meteorological disasters affecting
operations◆ Risk of floods associated with rising sea levels◆ Risk of drought in the water intake area, risk ofpollution in the discharge area
◆ Violation of environmental regulations andlaws◆ Environmental accidents

Opportunities● Expand the business scale throughprivatization of public services● Need for remote monitoring andautomation due to a lack of humanresources◆ Need for improving operational efficiency andreducing environmental impact

JFE GROUP CSR REPORT 202015

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Initiatives● Use AI and IoT to develop
technologies for remote monitoring
and automation as well as predictionof mechanical breakdowns◆ Optimize operations by analyzing incinerator
combustion conditions, reduce environmental
impact<For more information:>
Development and Provision of Ecofriendly Processes and Products(P. 46)

JFE GROUP CSR REPORT 202016

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesValue of SteelIron makes up approximately 30% of the Earth’s mass. Because of its rich reserves, steel can be mass
produced at very low cost. Compared to other materials, the environmental impact of its production isextremely low and it has excellent recyclability. Steel can be recycled repeatedly and reborn as various
products (closed-loop recycling) with little or no environmental impact, contributing to the sustainablegrowth of our society.

Life Cycle Assessment of Steel
Steel’s excellent recyclability contributes to the creation of a sophisticated value chain encompassing
three components: Produce, Use, and Recycle. Steel products can be repeatedly reborn as various
products. It is therefore important that the environmental impact of steel be assessed across its entire
life cycle, including at the recycling stage. JFE Steel participates as a key member in an initiative led by
the Japan Iron and Steel Federation (JISF) to quantify the environmental impact of the entire life cycleof steel products and developed the ISO/JIS standard* calculation methodology. Corresponding to thisstandard, materials with higher recyclability are found to have lower environmental impact such as on
global warming.
* ISO 20915: Life cycle inventory calculation methodology for steel products (2018.11)
JIS Q 20915: Life cycle inventory calculation methodology for steel products (2019.6)

JFE GROUP CSR REPORT 202017

Message fromthe CEO

JFE Group
VisionProduce

CSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesHigh Economic Efficiency and Low Environmental
ImpactEarth, a Planet of Iron (Abundant Resources)
As much as 85% of the Earth’s metal resources are iron ore (190 billion tonnes).
Source: Mineral Commodity Summaries (2016)

Recoverable Reserves of Iron Ore on the Earth

Mass Production at Low Cost
Iron is a material with rich reserves and a long history of development. It can be mass produced atreasonable price and supplied stably, thereby contribute to the sustainable growth of society.

Global Demand(2017)

Created by JFE Holdings with documentsfrom Mizuho Bank Industry Research Divisionand economic forecasts by Fuji Kenzai Co.,Ltd.

Price*

Research: JFE Holdings* Cost of producing one unite weight of ironis indexed at 1 for comparison with othermaterials.

JFE GROUP CSR REPORT 202018

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Extremely Low Environmental Impact at the Manufacturing Stage when Compared to Other
Materials
Greenhouse gas (GHG) emissions of steel at the manufacturing stage*1 is 1/5 to 1/9 of that ofaluminum and approximately 1/11 of that of carbon fiber. 。

GHG Emissions at the Manufacturing Stage*2

Source: Steel Recycling Institute*1 From mining raw materials to factory shipment.
*2 Comparison with other materials’ GHG emissions per unit weight, with steel as 1.

Japanʼs Steel Industry Keeps the Top Energy Efficiency in the World
Japan’s steel industry (converter steel) produces steel with the lowest environmental impact comparedto other major countries. This is a result of its longstanding efforts toward environmental conservation,
including developing and spreading the use of energy-saving technologies.

Worldʼs Quotient, with Japan as 100 (2015)

Source：Research Institute of Innovative Technology for the Earth(RITE)JFE GROUP CSR REPORT 202019

Message fromthe CEO

JFE Group
VisionUse

CSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Foundation of Daily Life and Society

The Potential to Grow on a Global Scale
Global average of annual consumption of steel is approximately 220 kg per capita. The long-term
global demand for steel is expected to keep growing alongside the economic development of emerging
countries.

Trends in Annual Steel Consumption per Capita by Country (kg/person/year)

Source: World Steel Association

Potential for Evolution
Steel can be elongated two to three times more than aluminum at the same rigidity and is three to fivetimes stronger at the same extended rate, making it the optimal material for new world-classstructures such as TOKYO SKYTREE. And yet there is still potential for further evolution. The
emerging needs of society will advance the development of steel and contribute to a productive future.

Comparison of Strength and Elongation between Steel, Aluminum, and Carbon Fiber

Research: JFE Holdings
JFE GROUP CSR REPORT 202020

Message fromthe CEO

JFE Group
VisionRecycleCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Excellent Recyclability

Steel is a highly recyclable material that can be easily recovered and separated using magnets. It canbe efficiently recovered, separated, and recycled into high-quality, high-functioning products over andover again through closed-loop recycling.

Closed-loop Recycling of Steel
Steel can be recycled a number of times as a raw material for steel products while retaining its original
properties.
Closed-loop recycling is superior to open-loop recycling in terms of sustainability, because closedloop recycling reduces the consumption of natural resources, as well as the amount of environmentallyhazardous substances and wastes.

Closed-loop Recycling* In open-loop recycling, the material recycling process involves two types of finite recycling which
are thermal recycling and cascade recycling. Thermal recycling means that heat generated byincineration is recovered while cascade recycling indicates recycling the material accompanied by
the degradation or alteration of the material’s properties.

JFE GROUP CSR REPORT 202021

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesMaterial CSR Issues
Identifying material CSR issues
The JFE Group identified material CSR issues that strongly impact where and how it should invest its
resources, making every effort to minimize negative societal impact and maximize the societal value as
only the JFE Group can.
The following table summarizes five areas of focus and 13 specific issues identified as material CSR
issues. The JFE Group will respect human rights as a fundamental aspect of its business and activities
contributing to society and will advance its efforts to address these material CSR issues based on fair
and transparent corporate governance. Such initiatives will demonstrate the Group’s vision of“Contributing to society with the world’s most innovative technology” and will contribute to its
sustainable growth as well as the sustainability of society.

Contribution to the Sustainability Development Goals (SDGs) through Business Activity
In September 2015, a UN Summit adopted 17 SDGs to beaddressed through worldwide efforts to achievesustainable development. The JFE Group is responding tothis call through contributions achieved by its businessactivities.

JFE GROUP CSR REPORT 202022

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Process for Identifying Material Issues

STEP1

Identification

By measuring the businesses of the JFE Group against the following yardsticks, we have identified 35
core issues with respect to society’s expectations for our CSR initiatives.
 GRI G4 Sustainability Reporting Guideline
 ISO 26000
 Sustainability Development Goals (SDGs)
 ESG survey via external assessment organization
 Internal documents on employee satisfaction surveys, etc.
 Benchmark surveys conducted to the three businesses

35 Core Issues

EconomyEnvironment

SocietyThorough complianceAppropriate disclosure
Corporate governance
CSR management
Customer satisfaction
Supply chain management
Risk management
Transparent resource
management
9. Tax management
10. Financial performance
improvement
11. Innovation management
12. Provision of quality
products
13. Information-security
management

14. Environment management
15. Financial benefits throughenvironmental investment
16. Eco-friendly products
17. Global warming mitigation
18. Energy efficiency
improvement
19. Efficient use of water
resources
20. Air pollutant emissions
control
21. Resource recycling
22. Biodiversity
23. Renewable energy
24. Chemical substancesmanagement and release
control

25. Ensure occupationalsafety and health
26. Stakeholder engagement
27. Sound labor-management
relations
28. Respect for human rights
29. Human resources
diversity
30. Fair valuation andcompensation for
employees
31. Securing and cultivating
outstanding humanresources
32. Employee satisfaction
improvement
33. Societal contribution
through business34. Societal contribution
activities
35. Work-life balance

1.
2.
3.
4.
5.
6.
7.
8.

JFE GROUP CSR REPORT 202023

Message fromthe CEOSTEP2

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesPrioritization (Group-wide Meeting)The 35 core issues identified in STEP 1 are prioritized through two criteria:(1) Vertical axis: Stakeholder expectations(2) Horizontal axis: Relevance to business (societal impact)(1) We identified 13 issues in 5 focus areas by measuring the impact of decision-making on
stakeholders for (1), and holding a Group-wide review meeting for (2).

Group-wide Meeting to Prioritize Material CSR Issues
Held on November 29, 2016
Managers from each operating company discussed the prioritization of the 35 core issues from theperspectives of group management and their respective operating companies’ interests.

STEP3

Validation

The following process validated 13 material CSR
issues in five focus areas: Confirmation and examination by each operating company
 Examination and approval by the JFE Group CSR Council** Participants: president of JFE Holdings (chairperson), executive vice president, corporate officers,
full-time Audit & Supervisory Board members, presidents of operating companies, etc.

JFE GROUP CSR REPORT 202024

Message fromthe CEOSTEP4

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Review and Set KPIs

We reviewed material CSR issues identified in FY2016 and set KPIs in FY2017.
 Review
 Review by the JFE Group CSR Council
 Examine comments by third-party experts on the CSR report Set KPIs
Set KPIs in accordance with the following process and implement PDCA cycles
 Review at each operating company
 Submit draft KPIs to the JFE Group Environmental Committee for deliberation
 Examination and approval by the JFE Group CSR Council

KPIs for Material Issues
KPIs for Material CSR Issues-Results for FY2019 and Revision to be Applied on and after FY2020
The JFE Group has established KPIs to address the CSR issues identified in FY2016. It tackles these
KPIs by focusing the power of the entire Group.
In FY2020, the Group assessed the previous year’s KPI results. Assessment results together with
opinions exchanged with stakeholders were used to further review the KPIs.
The Group will efficiently implement PDCA cycles and promote effective CSR management by
setting KPIs that take into consideration the business characteristics of each operating company.

JFE GROUP CSR REPORT 2020

25

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■KPIs for Material CSR Issues
Results for FY2019 and Revision to be Applied on and after FY2020

Message fromthe CEO

JFE GROUP CSR REPORT 2020

26

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

Message fromthe CEO

JFE GROUP CSR REPORT 2020

27

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

Message fromthe CEO

JFE GROUP CSR REPORT 202028

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesCSR Structure
JFE Group CSR System
The JFE Group realizes corporate responsibility by understanding itself as part of the society andconsiders corporate social responsibility (CSR) to be the foundation of its business as it contributes tothe realization of a better society.

Supervision over CSR Initiatives (JFE Group CSR Council, Group Management
Strategy Committee, and Board of Directors)
The Group established the JFE Group CSR Council, chaired by the president of JFE Holdings andcomprised of the executive vice president (director), corporate officers, full-time Audit & Supervisory
Board members, the presidents of operating companies, and other members to oversee and direct the
CSR initiatives of the entire organization. Three independent, cross-Group committees have been
established under the council, JFE Group Compliance Committee, JFE Group Environmental Committee,
and JFE Group Internal Control Committee to discuss specific topics as well as to oversee and direct
the Group’s CSR initiatives. Topics regarding CSR policies and initiatives discussed at the meetings ofthe Group CSR Council and deemed important to management will also be deliberated at the GroupManagement Strategy Committee and reported to the Board of Directors. The board oversees theGroup’s CSR activities by discussing the key matters reported.

JFE Group CSR Council Activities
The Group CSR Council meets approximately once every three months to discuss policies related to theGroup’s CSR initiatives, including instruction and guidance on material issues, to monitor the
penetration of the policies within the Group, and to share information and carry out horizontal
communication regarding examples of our responses to issues and problems. The council deals with abroad scope of issues, including those related to compliance, the environment, climate change, humanresources, labor issues, safety, disaster prevention, social contribution, addressing antisocial forces,and ESG-related risks.

Cooperation with Operating Companies
Entities with functions similar to those of the Group CSR Council are set up at each operating company
as well and coordinate the promotion of Group-wide CSR initiatives. JFE Steel established the CSR
Council chaired by the President in July 2005, following the establishment of the CSR Section in April
2005. Specific committees and sub-committees in areas such as compliance, global environment, risk
management, safety and disaster prevention, customer satisfaction, social contributions, etc.
established under the CSR Council have been actively conducting the activities in each area, while
promoting CSR awareness together with the Group companies. JFE Engineering and JFE Shoji also leadin the promotion of CSR through establishment of committees in areas such as compliance andenvironmental committees.

JFE GROUP CSR REPORT 202029

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ CSR Structure

Confirmation and Improvement through the Employee Awareness Survey
The JFE Group regularly conducts a Corporate Ethics Awareness Survey for directors and employees of
the Company as well as the operating companies to confirm the penetration and thorough complianceof the Group’s Corporate Vision, Corporate Values, and Standards of Business Conduct, along with theidentification of potential risks. The survey conducted in 2019 confirmed that many employees
acknowledged the vision and corporate policy and are aware of compliance matters when carrying out
their work. On the other hand, the survey also brought to our attention issues to address going forward.
The survey results were reported to the Board of Directors and JFE Group CSR Council, and eachcompany worked on reflecting the information in their specific initiatives.

JFE GROUP CSR REPORT 202030

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesCSR Audit
To ensure that CSR activities are conducted properly, the JFE Group systematically audits
environmental management, Antimonopoly Law compliance, expense management, overseas officemanagement, tax law compliance, safety management, and disaster prevention. If an audit reveals a
problem, the internal audit departments of JFE Holdings and relevant operating companies share
information to support the implementation of corrective measures in their CSR activity.

Initiatives and Relevant SDGs
The JFE Group is taking action to address CSR issues, even in non-material areas.
The following chart summarizes all activities introduced in this report. Through these activities, theJFE Group intends to contribute to the achievement of the SDGs.

Activities

Related SDGs

CSR Management
Supply Chain
Management(P. 37)••

Procurement Policy andInitiatives for EachBusiness
Promoting Green
Procurement

Addressing ESG Issues
Environmental
Management(P. 39)•Climate Change(P. 63)•••
Prevention of
Pollution(P. 95)•••

Efficient Use of
Resources(P. 100)•••

Environmental
Management System
Environmental
Education
Saving Energy andReducing CO2 in Iron
and Steelmaking
Process
Initiatives for Reducing
CO2
Controlling Air
Emissions
Preventing Water
Pollution
Management ofChemical Substances
Reducing Generationand Emission of Coproducts and Reusing
Co-products
Promoting Recycling
Resource Recycling
Solution

JFE GROUP CSR REPORT 202031

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Water Security(P. 103)・Efficient Use of Water

Biodiversity(P. 106)•••

Environmental
Communication(P. 109)•

Customer
Responsibility(P. 111)

•
•

•

•
•
Occupational
Health and
Safety(P. 117)•

Labor Standards(P. 124)

•
•
•

•

•
Human Rights(P. 135)•

Community(P. 138)

•
•

•

•
•

Biodiversity Initiatives
Commitments toExternal Initiatives
Products andTechnologies to
Preserve Biodiversity
Disclosing
Environmental Data
Disclosure andExchange ofInformation
Quality Initiatives
Quality Improvementand Enforcement of
Quality Assurance
Systems
Improving Customer
Satisfaction
Responsible Export
Practices
Occupational Healthand Safety
Employee HealthWorkstyle Reform
Operational Reform
Workforce Diversity
Promotion
Developing Dynamic
Work Environments
Respecting Human
Rights Initiatives
Respecting the Rights
of Workers
Local Activities
Support for External
Organizations
Support for Youth
Development
JFE 21st Century
Foundation

JFE GROUP CSR REPORT 202032

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Shareholders
and Investors(P. 147)•

Proactive Information
Disclosure

Compliance(including Anticorruption）(P. 158)•

Adherence to EthicalStandard; Legal
Compliance

Tax
Transparency(P. 164)•

Basic Policy

JFE GROUP CSR REPORT 202033

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Stakeholder Engagement
The JFE Group strives to maintain agreeable and favorable relationships with all stakeholders,
including Stakeholder Engagement shareholders, customers, clients, employees, and local
communities, for the sustainable growth and medium- to long-term increase of corporate value.
■ JFE Group’s Major Stakeholders
Approach

Major Communication Methods,
etc.

OthersFrequency(per year）

Scale, etc.

Shareholders/Investors

We work to disclose
information accurately,
fairly and in a timely andappropriate manner aswell as strive for active
communication. We
established the Investor
Relations and Corporate
Communications
Department as anorganization responsible
for communication withdomestic andinternational shareholders
and investors, and topromote constructive
dialogue as well as
provide management with
the information acquired,with the aim ofmaintaining and improving
the relationship of trust.

Ordinary general meeting ofshareholders (convocation
notices, notices of resolutions,
etc.)

1

Approx. 150,000
shareholders

Investors meeting (financial
results, medium-term businessplan, etc.)

5

Approx. 500
persons in total

Individual meeting (financial
results, medium-term businessplan, etc.)

As needed

Approx. 400
persons in total

Briefings (at the branch offices of
securities firms, etc.)

11

Approx. 800
persons

Plant tours for shareholders(steel, engineering, shipbuilding
bases, etc.)23

Approx. 1,800
persons

2 (mid-year
and annual)

Approx. 220,000
copies/issues

1

Approx. 40,000
copiesPublishing shareholder
newsletters (JFE Dayori)
Various reports, including
integrated reports and CSR
reports
Information via websites (forshareholders and investors), etc.

As needed

Communication through sales
activities and support for quality
assurance

As needed

Conducted at each
operating company

Interviews and questionnaires,such as that on customer
satisfaction

As needed

Conducted at each
operating company

Information via websites (productinformation), etc.

As needed

Customers
The Group believes thatthe stable supply of
products and services andreliable quality assurance,along with advancing
research and development,
are necessary to meetcustomer needs. We will
work to establish win-win
relationships bycontinuously meetingcustomer needs and thetrust they place in us.

JFE GROUP CSR REPORT 202034

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Clients
CSR initiatives are being
actively pursued together
with our clients, who areimportant business
partners. We haveestablished Purchasing
and Procurement Policies
to promote fair andsincere procurement
activities and to construct
healthy relationships withclients.

Communications throughpurchasing activities

As needed

Conducted at each
operating company

Briefing and discussions

As needed

Conducted at each
operating company

Information via website, etc.

As needed

Communications through daily
operations and in the workplace

As needed

Internal newsletters and intranet

As needed

Employees

With the recognition of
top management thatcreating workplaces toprovide dignity and job
satisfaction for all isessential for maximizing
the potential ofindividuals, we haveformulated the Basic
Policy on Human
Resource Managementand Health Declaration
and are conducting
various activities towardattaining the goals.

2 to 4

Management andlabor unions at
each operatingcompany

Corporate Ethics Hotline

As needed

101 calls in
FY2019Various training sessions

As needed

Position-specific,
compliance,
human rights, etc.

Family days (visits by employee
families, lunch at employees’cafeterias, etc.)

As needed

Conducted at each
operating company

1 (every 3 years)

At the company
and operatingcompanies

Various labor-management
committees

Corporate Ethics Awareness
SurveyJFE GROUP CSR REPORT 2020

35

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

Local communities

To ensure business
continuity at
manufacturing bases
where steelworks arelocated and elsewhere,
constructing a
relationship of trust withcitizens in local
communities and realizing
coexistence andprosperity are crucial. We
will pursue various
activities with the aim ofrealizing sustainablegrowth and regional
development, including
continued initiatives
toward ensuring safety
and reducing ourenvironmental impact.

Communication through local
residents’ associations, events,
etc.

As needed

Events at manufacturing bases(festivals, etc.)

Approx. once ineach region

Approx. 270,000
persons a year

Plant tours

As needed

100,000 or more
persons a year

Clean-up activities (vicinity of
manufacturing bases, regional
cleaning, etc.)

As needed

Sports promotion (baseball or
jogging workshops, various
sports competitions, etc.)

As needed

Others (education at elementary
schools, craft workshops,
workplace experience events,
etc.)

As needed

Information via websites(environmental info, etc.)

As needed

Social contribution through JFE
21st Century Foundation(http://www.jfe-21st-cf.or.jp/eng/)(various research support,
regional activity support, etc.)

As needed

JFE GROUP CSR REPORT 202036

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Supply Chain Management
Basic Policy
Through the adoption of the Sustainable Development Goals (SDGs) and the Paris Agreement, theinternational community has called on companies to actively engage in actions to resolve global issues
toward realizing a sustainable society. Existing harmoniously with the global environment, respecting
human rights, and providing challenging work environments are some of the JFE Group’s commitmentsin the JFE Standards of Business Conduct and the Group promotes initiatives under these standards. In
order to realize a sustainable society, we believe it is important to address these challenges within theGroup itself as well as across the entire supply chain. We will continue to push forward with our
initiatives supported by the understanding of our suppliers and other business partners.

Promoting Green Procurement
The JFE Group’s procurement policies help to conserve resources and protect the environment by
ensuring adherence not only to all laws and regulations but also to procurement principles stated in theCharter of Corporate Behavior developed by the Japan Business Federation. Going forward, the JFEGroup expects to accelerate such efforts in its supply chains.

Procurement Policy and Initiatives by Each Business
JFE Steel

Basic Policy on Procurement
JFE Steel upholds its Basic Policy on Procurement to conduct purchasing activities with fairness andsincerity and thereby continue earning supplier trust as a good business partner.
JFE Steel’s basic purchasing and procurement policies are summarized below.
Basic Policy on Procurement (https://www.jfe-steel.co.jp/en/company/purchase_policy.html)
As for material procurement, the company has established the Raw Material Purchasing Policy todevelop and operate a sustainable procurement system for sourcing raw materials. Through the system,
JFE Steel pays due consideration to human rights, including the prohibition of child labor and forcedlabor, as well as legal compliance and environmental protection. In addition, the company purchases
raw materials after confirming that suppliers are not using conflict minerals.
JFE Steel’s Raw Material Purchasing Policy is summarized below.
Raw Material Purchasing Policy (https://www.jfe-steel.co.jp/en/company/purchase_policy.html#purchase_policy)

Requesting Suppliers to Promote CSR
JFE Steel believes that its social responsibility is to raise stakeholder satisfaction and enhance its
corporate value. To that end, the company prioritizes efforts in areas such as environmental protection,
safety, disaster prevention, and compliance, which are fundamental to its survival, and requests its
suppliers to pursue their own CSR initiatives.
JFE Steel’s CSR Procurement Guidelines are summarized below.
CSR Procurement Guidelines(https://www.jfe-steel.co.jp/en/company/purchase_policy.html#to-our-business-partners)

JFE GROUP CSR REPORT 202037

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Win-Win Relationships with Suppliers
JFE Steel establishes win-win relationships with our suppliers by leveraging their ideas for improving
materials, designs, shapes, specifications and production methods. The company’s value-analysis
activities allow them to propose how to reduce costs, improve materials functions, and upgrade quality,
safety and work efficiency. The company then strives to implement the ideas wherever possible.

JFE Engineering

Fair and Sincere Procurement
JFE Engineering, viewing its suppliers as key partners in achieving mutual growth, strives to nurture
mutual trust and reinforce partnership relationships. The company seeks to engage in procurement
activities with integrity by complying with guidelines on fair procurement and codes of conduct forbuilding sound and equitable relationships with suppliers and providing training for staff who areresponsible for contracts.
The company collaborates with suppliers on CSR initiatives and upholds its Purchasing andProcurement Policies as a standard for fair and transparent procurement activities.
JFE Engineering’s Purchasing and Procurement Policies are summarized below.
Purchasing and Procurement Policies (Japanese Only)(https://www.jfe-eng.co.jp/information/basic_policy.html)

JFE Engineering requests that suppliers implement the following measures.

Requests to Suppliers Regarding CSR Initiatives(1) Comply with laws, regulations and social norms(2) Implement thorough information management(3) Provide safe and competitive products and services(4) Observe human rights, work environments and occupational health and safety(5) Respect the global environment(6) Develop an organization for promoting CSR

JFE Shoji

Ensuring a Safe, Fair Supply Chain
Corporate social responsibility (CSR) is a pivotal element in JFE Shoji’s supply chain for the provision of
products, functions, and services through its global business. Customer demand for CSR-based
procurement is increasing every year. In addition to its initiatives for quality, stable supply, safety, andreasonable prices, the company will also further consider the global environment, human rights, andoccupational safety and health in terms of its procurement.

JFE GROUP CSR REPORT 202038

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Management
Environmental Philosophy and Strategies
The JFE Group’s environmental philosophy and strategies target the development of innovativetechnologies and international cooperation aimed at protecting the global environment by having theintention to achieve “Accordance with Global Environment” and “Improvement of Global Environment”
within the corporate activity.

Environmental Philosophy
The JFE Group puts top priority on protecting and enhancing the global environment to maintainits business in harmony with the environment, ultimately for the prosperity of society as a whole.

Environmental Strategies

1. Reduce the environmental impact of all businesses
2. Contribute through technologies and products
3. Conserve resources and energy
4. Communicate with society
5. Facilitate international cooperation

Framework for Environmental Management
The JFE Group Environmental Committee, chaired by the president of JFE Holdings and operating
under the JFE Group CSR Council, sets goals for environmental protection, monitors the progress ofsuch initiatives and works to improve the Group’s overall environmental performance.
Key issues for corporate management such as climate change are deliberated at the GroupManagement Strategy Committee as well and reported to the Board of Directors. The board oversees
environmental challenges by discussing the reported material. Additionally, specialized committees set
up by JFE Group operating companies and affiliates implement specific activities.
For the Group CSR System, please refer to the following information.
CSR Structure: JFE CSR System (P. 29)

JFE GROUP CSR REPORT 202039

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■Environmental Management System

Environmental Management System
Acquisition of ISO 14001 certification is an important part of every JFE Group company’s environmental
program. All global production sites of JFE Steel and JFE Engineering and major offices of JFE Shoji
have received the certification, encompassing 75% of 41,305 employees at 80 companies covered inthis report and 58% covered for total sites. In FY2019, there was no material breach of any
environmental law or regulation involving fines by any operating company, and the total amount of finesand penalties was zero yen.
JFE SteelJFE Steel has an Environment Management Department at its head office and in each business office,and the Environmental Committee chaired by its president and the Environment Management
Committee in each local office.
JFE Engineering
JFE Engineering’s Environmental Management System, which encompasses all employees, works tominimize environmental impact at production sites and branch offices and contribute to environmental
protection through all products and services. The major strategies for FY2020 are (1) promote
environmental contribution through products for mitigating global warming and climate change, (2)promote effective energy conservation and resource recycling that reflect the actual circumstances ofeach site and operation, and (3) prevent violations of the Waste Management and Public Cleansing
Law.
JFE Shoji
JFE Shoji obtained ISO 14001 certification for its head office, Osaka branch, and Nagoya branch in2000.
For quantitative data related to ISO 14001, please refer to the following information.
ESG Data: Environmental Data (P. 165)
JFE GROUP CSR REPORT 202040

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Audits
In addition to the regular internal and external audits at ISO 14001-certified sites, the audit andenvironment departments at each operating company’s head office conduct independent environmental
audits at their production sites.

JFE SteelOnce a year, JFE Steel’s Audit Department and the Environment, Disaster Prevention and Recycling
Department conduct an environmental audit at each operational site. For group companies, companies
are grouped by risk assessments of equipment, etc., using self-checks based on checklists, part of an
extensive audit conducted every one to five years.

Environmental audit of JSGI in Indonesia
JFE Engineering
JFE Engineering places a top priority on complying with environmental laws and regulations.
To verify compliance with these regulations, environmental inspections are conducted at all
construction sites by the department responsible for construction, and the Tsurumi and Tsu
manufacturing sites conduct self-checks on an annual basis to confirm legal compliance. In addition,
about 50 locations, selected from among the manufacturing sites, construction sites in Japan, andgroup company sites, are audited each year by the Safety and Environment Department to confirm
compliance with environmental laws and regulations. JFE Engineering also conducts internal audits on
its own environment management system to evaluate and enhance the effectiveness of various
environment-related initiatives.
JFE Shoji
At JFE Shoji, the Environmental Auditing Department conducts internal environmental audits at all of
its affiliate companies that are ISO 14001-certified annually. Non-certified group companies are also
audited once every three years by the Audit Department.
For quantitative data related to environmental audits, please refer to the following information.
ESG Data: Environmental Data (P. 165)
JFE GROUP CSR REPORT 202041

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Education
The JFE Group actively provides education to foster a corporate culture of environmental protection.
Education at operating companies includes training for new recruits and newly promoted employees aswell as specific environmental-protection training organized by position and job.
JFE SteelJFE Steel encourages employees to obtain qualifications as pollution-control managers. A training
program for environmental managers at group companies was launched in FY2011. In addition, JFE
Steel provides employees with training to ensure compliance with environmental laws, disseminates
information about regulatory revisions at its Environmental Liaison Committee meetings for Group
companies, and organizes brush-up training in waste management skills for onsite personnel.

JFE Engineering
JFE Engineering educates all employees about environmental issues to increase their understanding of
the company’s related policies and initiatives. To ensure proper environmental management at its
production sites and construction sites, training is often tailored to the specific operations of
employees, helping them to enhance their capabilities.
In FY2020, the Safety and Environment Department and other departments worked together tocreate and implement an education program with details tailored to the specific needs of eachdepartment.

JFE Shoji
JFE Shoji provides all employees with general environmental training in compliance with ISO 14001 andspecialized training for internal audit staff on an annual basis. In addition, each company performs aself-check using its own extensive checklist to ensure understanding and rigorous compliance withenvironmental laws. Also, JFE Shoji provides environmental training to new executives and information
about revised laws and regulations to environmental management personnel.
For quantitative data related to environmental education, please refer to the following information.
ESG Data: Environmental Data (P. 165)

JFE GROUP CSR REPORT 202042

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Accounting
Basic Policy
The JFE Group is saving energy and reducing its environmental impacts by making its production
facilities increasingly efficient and introducing more environmentally friendly equipment. Suchinvestments, which are categorized as environmental costs, cover equipment, facilities, and related
expenditures for environmental protection and impact reduction.

Environmental Investment and Expenses
Environmental capital investment totaled 46.8 billion yen and expenses amounted to 113.1 billion yen
in FY2019. Capital expenditure included 26.7 billion yen for measures to prevent global warming(measures to address climate change), 11.0 billion yen for air pollution countermeasures, and 4.1
billion yen for water pollution prevention. Environmental capital investment as a percentage of overall
capital investment was roughly 19%.
Environmental expenses for environmental activities included 34.1 billion yen for air pollution
countermeasures, 27.6 billion yen for global warming countermeasures (measures to address climatechange) and 18.3 billion yen for industrial water recycling. Environmental R&D expenses came to 11.3
billion yen.

Capital Investment
To save energy and reduce environmental impacts stemming from production, the JFE Group invests inenvironmental technologies for plants and equipment. Cumulative investment in energy savings,
totaling 532.1 billion yen since 1990, has enabled the company to achieve energy efficiencies that areamong the highest in the world. In total, the Group has invested 727.6 billion yen in environmental
protection since 1973.

Results of Environmental Activities
Environmental protection costs include efforts to lower unit-based CO2 emissions to prevent global
warming and measures to reduce final-disposal waste and conserve natural resources throughrecycling. Other benefits include reduced discharges of airborne and waterborne substances with
pollution loads and compliance with statutory regulations concerning exhaust gas emissions anddischarged water.
The monetary value of energy savings realized through environmental capital investments andexpenses in FY2019 is about 4.6 billion yen.

JFE GROUP CSR REPORT 202043

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Breakdown of Environmental Costs
FY2019Main Items

Investment(billion yen)

Cost(billion yen)Management

Impact monitoring and measurement, and EMS
expenses and education

0.1

2.6

Global warming
countermeasures

Saving and efficiently using energy

26.7

27.6

Recycling industrial water

3.9

18.3

Recycling and waste management of internallygenerated materials, etc.

0.06

5.1

Air pollution countermeasures

11

34.1

Water pollution countermeasures

4.1

11.3

Prevention of soil contamination, noise,
vibration, and subsidence

0.04

0.6

Conservation ofnatural resources

Environmental
protection

Other

Charges, etc.

-

1.5

R&D

Technologies for protecting the environment,saving energy, and preventing global warming

1

11.3

Societal activities

Support for nature preservation and forestation,
information disclosure, exhibitions, and public
relations

-

0.7

46.8

113.1

Total

Note: Data cover all investment activities of JFE Steel Corporation and R&D activities of JFE Engineering
Corporation.
For quantitative data related to environmental accounting, please refer to the following information.
ESG Data: Environmental Data (P. 165)

Development and Provision of Eco-friendly Processes and Products
For more on this, please refer to the following information.
Development and Provision of Eco-friendly Processes and Products (P. 46)

JFE GROUP CSR REPORT 2020

44

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesMaterial Flow
For more on this, please refer to the following information.
Material Flow (P. 61)

Related Links
JFE Steel’s Website: Environmental Initiatives (Japanese only)(https://www.jfe-steel.co.jp/research/environment.html)

JFE Engineering’s Website: 360° JFE Engineering(https://www.jfe-eng.co.jp/en/360_jfe_engineering/#env)

JFE Shoji’s Website: Environment Management (https://www.jfe-shoji.co.jp/en/csr/environment/)

JFE GROUP CSR REPORT 202045

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesDevelopment and Provision of Eco-friendly Processes andProducts
JFE Steel

Ferro Coke
Ferro coke, an innovative raw material for blast furnaces, is made by mixing low-grade coke and ironore. The ultra-fine metallic iron inside ferro coke acts as a catalyst and accelerates the reduction
reaction rate in the blast furnace, significantly reducing the amount of coke required.
Since FY2017, JFE Steel has been conducting the New Energy and Industrial Technology
Development Organization (NEDO)’s project, “the development of environmental technology forsteelmaking process / technological development of iron making process utilizing ferro coke.”As part of the project, a medium-scale facility with the capacity to produce 300 tonnes of ferrocoke per day is currently being constructed in the Fukuyama district of the JFE Steel West Japan Works,
covering 12,600 square meters. The facility is designed to handle all steps involved in the productionof ferro coke, from crushing and drying to molding and dry distillation. It is also capable of recycling
ferro tar, a byproduct of ferro coke production, as a binding agent for briquetting.
Facility construction is scheduled for completion in September 2020. It will begin operations in
October and demonstrate the effect of using ferro coke in blast furnaces over a long period. We expect
to reduce energy consumption in the iron making process by 10% by 2023 and in turn achieve asignificant reduction in CO2 emissions.
■Process Flow of the Medium-scale Ferro Coke Production Facility

Medium-scale Ferro Coke Production Facility
JFE GROUP CSR REPORT 202046

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■Ferro Coke・Briquette・Ferro coke

・Cross section of ferro coke

Coke Metallic ironIntroducing Data Science Technology at All Steelworks Blast Furnaces
JFE Steel is introducing advanced data science technology (DS) at our blast furnaces.
To reduce CO2 emissions from our steelworks, it is extremely important that blast furnaces, whichremove oxygen in iron ore for the production of iron, operate stably and at high efficiency. However,attaining this level of operation is challenging because it is not possible to directly view the inside of
the furnace and because operating conditions can change moment by moment depending on the raw
materials used.
Consequently, JFE Steel is now deploying data science technology to convert its eight blast furnaces
in Japan to cyber-physical systems (CPS) managed with computer-based algorithms. The conversion
applies artificial intelligence to analyze sensor data collected from the physical manufacturing process
and then creates a virtual (cyber) process in digital space using proprietary techniques, after which thetwo processes are linked in real time. The virtual process enables the visualization of the blast
furnace’s internal state to predict future conditions, allowing the blast furnace to operate stably, which
in turn reduces CO2 emissions.
In the longer term, JFE Steel intends to extend CPS conversion to other processes to realize
innovative productivity and greater stability across all steel manufacturing operations.
■ Blast Furnace CPS Concept

JFE GROUP CSR REPORT 2020

47

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Introducing a Guidance System to Manage Fuels and Electricity Consumptions in Steelworks-Optimization of Consumption Based on Cyber-physical Systems
JFE Steel developed what it calls the Guidance System for operators to efficiently utilize fuels andelectricity in domestic steelworks to reduce energy consumption and CO2 emissions. So far, the system
has been rolled out in the Kurashiki and Fukuyama districts in the JFE Steel West Japan Works and will
be rolled out in other sites to increase the overall benefits in reduced energy consumption and CO2
emissions.
In steelworks, gases, electricity and steam that are generated as byproducts by upstream processes
are consumed within the same premises. We also purchase fuel and electricity from external sources
to meet actual demands. To efficiently utilize fuel and electricity, many different factors need to be
managed to minimize cost and energy losses, including the ratio of byproduct gases to be distributed toeach process, the amount of electricity and fuel to be purchased, and the storage volume of byproductgases.
The Guidance System (1) uses the vast amount of real-time data obtained based on CPS and eachfactory’s detail manufacturing plan, (2) calculates precise future demands, (3) considers operationaland contractual limitations, (4) runs simulations to determine the optimal operational plan forminimizing external purchases and (5) guides operators toward this optimal plan.

■ Steelwork’s Energy Flow

■ Guidance System Overview

Technology Development for Realizing Zero-Carbon SteelJFE Steel Corporation, together with Nippon Steel Corporation, Kobe Steel, Ltd. and Japan Researchand Development Center for Metals Foundation applied to NEDO’s public project “technology
development for realizing zero-carbon steel” and were selected as the participating members as ofJune 11.

JFE GROUP CSR REPORT 2020

48

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Based on the knowledge gained from a previous project, “the development of environmental
technology for steelmaking process / development of hydrogen reduction and other technologies(phase II - step 1)” (COURSE50), we will conduct research over the project duration of FY2020–2021,
which will involve assessing current challenges and creating a research and development roadmap forthe research and development toward zero-carbon steel. These activities can serve as the foundation
for future research and development and help to accelerate them. JFE Steel will be involved inholistically assessing various technologies, including the latest blast furnace technology and hydrogen
reduction technology.

Conserving Energy by Reducing Energy Loss from Molten Steel Vessels
The vessels used in steelmaking to carry hot metal and molten steel are made of iron with inner walls
covered in refractories. However, because the surface temperature of these vessels can exceed 300
degrees Celsius across such a large surface area, the vessel loses a significant amount to heat. To
overcome this, we have developed a new technology that uses high-quality insulation material to lower
the surface temperature and prevent radiation heat transfer.
After optimizing the insulation material layout, we conducted tests using production vessels over along period and confirmed that the heat loss from the vessel surface was reduced to 55–75% ofconventional vessels. Applying the technology to all of our molten metal vessels could achieve energy
savings (in crude oil equivalent) of 21,000 kl annually, which equates to the annual consumption of
26,000 per the average household*.
The energy saving quality of this technology is highly regarded, and it received the ECCJ Chairman’s
Award (The Energy Conservation Center, Japan Chairman's Award) in Energy Conservation Grand Prize
2019’s Best Practice Category.
* Calculated using a 31.3 GJ/household, the actual energy supply-demand data for FY2018 provided by
the Agency for Natural Resources and Energy■ Insulating Effect of High-quality Insulation Material

Anode Material for All-polymer Battery, a Next-generation Lithium-ion Battery(JFE Chemical Corporation)
Electric vehicles and renewable energy are key pillars for realizing a decarbonized society in the future,and the further advance of these technologies will depend on the development of high-quality lithiumion batteries. The all-polymer battery is a next-generation lithium-ion battery. It realizes greater safety,
durability and energy density and will significantly reduce production costs and ensure high reliability
under abuse. This innovative battery overcomes the shortcomings of conventional lithium-ion batteries
and is expected to stabilize the use of solar power generation and other renewable energies while
accelerating the pace of transition toward a decarbonized society. APB Corporation is a start-up
company engaged in the development, manufacturing and sales of all-polymer batteries.
JFE GROUP CSR REPORT 2020

49

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
JFE Chemical, JFE Group’s driving force in its chemical businesses, has been involved in massproducing and selling anode materials for lithium-ion batteries using pitch derived from coal-tar, a steel
manufacturing byproduct. Recently, the company invested in the above mentioned APB Corporation
and agreed to supply them with hard carbon, a critical anode material for all-polymer batteries.
Using the technologies and know-how that it has accumulated over the years, JFE Chemical will
work with APB Corporation and contribute to the mass-production of all-polymer batteries through the
production and supply of hard carbon, which features low expansion and shrinkage and is suitable forthe anode material of all-polymer batteries.
■ Structure of All-polymer Battery (Single Cell)

Steel Slag Hydrated Matrix
Steel slag hydrated matrix is a steel slag product that can be used as a substitute for concrete but uses
ground granulated blast furnace slag instead of cement and steel slag instead of natural gravel andsand aggregate as its ingredients. It effectively uses steel slag and does not rely on natural aggregate,
thereby reducing environmental impact, uses less cement and in turn reduces CO2 emissions.
There are many examples of blocks and artificial stones made from steel slag hydrated matrix being
used as a substitute for concrete blocks and natural stones in harbor works, including the runway D
construction project at Haneda Airport by the Ministry of Land, Infrastructure, Transport and thecoastal reconstruction project after the Great East Japan Earthquake. In addition, we are conducting
onsite monitoring in the Katsunan Central Zone in Chiba port with the help of a local fishingassociation to assess the impact of these blocks on marine diversity.

Breakwater armor block
JFE GROUP CSR REPORT 202050

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Coastal construction work using artificial stones made from steel slag hydrated matrix

Use of Granulated Blast Furnace Slag to Reduce CO2 Emission
Granulated blast furnace slag in crushed and powdered form can be mixed with cement and used as a
substitute for cement for making concrete. This leads to reducing the production of cement hence
lower CO2 emissions. For example, producing one tonne of blast furnace slag cement with 45% of its
content substituted with granulated blast furnace slag emits 41% less CO2 than conventional cement.
In FY2019, JFE Steel supplied approximately 6.8 million tonnes of granulated blast furnace slag to
cement production, equivalent to a reduction of approximately 4.83 million tonnes of CO2 emissions.
In addition, we are focusing on blue carbon (carbon removed from the atmosphere by ocean
ecosystems), which has been a field of active research in recent years. We are involved in creating
seagrass beds using steel slag products, measuring the amount of carbon absorbed and fixed by the
seagrass beds and testing steel slag products as beds for seaweeds and corals.
■ CO2 Emission for Producing 1 Tonne of Cement (Unit: kg- CO2)

CO₂ Emissions Source

Regular Cement

Blast Furnace Slag Cement

Limestone

473

272

Electricity/energy

311

190

Total

784

463

Coral attached to Marine Block™
JFE GROUP CSR REPORT 2020

51

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Precast Concrete Products Mixed with Finely Ground Blast Furnace Slag
Finely ground blast furnace slag can be used as a cementing material in concrete. This type ofconcrete exhibits significantly higher durability under harsh conditions such as applications in seweres
and exposure to anti-freeze. Its effectiveness in reducing enviromental impact has been widely
understood, although there has recently been growing interest in its practical applications for concrete
constructions that require higher durability.
As one of the deliverables for the Japanese government’s Strategic Innovation Promotion Program(SIP), the Japan Society of Civil Engineers published a (draft) guideline in March 2019 on theapplication of finely ground blast furnace slag to precast concrete product and its application now
includes precast concrete slabs installed in highways and piers. With the application of finely groundblast furnace slag in concrete, the durability of precast products is expected to be greater and moreconsistent, allowing them to contribute to building a stronger nation.

Precast concrete products for extending road width

Restoring Marine Ecosystems Using Steel Slag Products
Marine Stone™, a gravel-type steel slag product, is a habitat forming material that suppresses
hydrogen sulfide, which arises from an unhealthy seabed and improves water and sediment quality inenclosed coastal waters. Its effectiveness in improving marine environments has been widely
recognized, and the joint project with Hiroshima University received the Minister’s Prize (Ministry ofAgriculture, Forestry and Fisheries) in the 12th Eco Products Awards and the Grand Prize in the 26th
Nikkei Global Environmental Technology Award.
Hiroshima Prefecture has used a total of 38,000 tonnes of Marine Stone™ in its Fukuyama Port
Marine Environment Creation Project (inner harbor area). Its marine environment improvement
property was confirmed to still be effective in 2019, four years after its initial placement.

Inner harbor area of Fukuyama Port, Hiroshima Prefecture, at low tide, where Marine Stone™ is laidout. The entire area is covered by seaweed and the marine ecosystems restored!
JFE GROUP CSR REPORT 202052

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Contributing to the Creation of an Attractive Seaside Town by Utilizing Steel Slag Products(Partnership Agreement with Yokohama City)
In a joint research project with Yokohama City, JFE Steel has confirmed that steel slag products,
including Marine Block™, which is steel slag absorbing CO2 gas, provide a highly effective base for
nurturing and growing sea organisms while also facilitating the natural cleansing of seabeds andseawater. To continue improving the marine environment in Yokohama Bay and developing an
attractive seaside town, we signed a new partnership agreement* with Yokohama City in March 2020.
Under this new agreement, we will continue to work toward improving the marine environment.
* Partnership agreement to improve the marine environment in Yokohama Bay and develop an
attractive seaside town

Marine Block™ covered by marine bivalves (Yokohama Bay area)

JFE GROUP CSR REPORT 202053

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Engineering

JFE-METS (Multisite Energy Total Service) Receives the Minister of Economy, Trade andIndustry Award in Energy Conservation Grand Prize 2019
Typically, energy optimization is considered and addressed at a site level. JFE-METS is a new energy
optimization service that offers energy optimization across multiple sites, for example, for an entire
company or region. It offers a holistic energy conservation solution by analyzing what the customer’s
energy consumption currently looks like, installing and operating the most appropriate energy facilities
that work across all their sites on their behalf and managing overall energy demand, including offsite
locations.
■ Example of JFE-METS

Commercialization of the New Sewage Sludge Treatment Technology OdySSEA—an Innovative Technology Satisfying Both a Large Reduction in Greenhouse Gas (GHG) andHigh-efficiency Power Generation
In a joint project with the Japan Sewage Works Agency (president: Toshihiro Tsujihara, head office:Bunkyo-ku, Tokyo) and Kawasaki City extending over the two-year period of FY2017-2018, JFE
Engineering carried out demonstration research combining a high-efficiency power generation
technology that utilizes unused waste heat from a sewage sludge incineration facility and a technologythat simultaneously reduces nitrous oxide (N2O) and nitrogen oxides (NOx) by optimizing the air
injection method. The demonstration research was also selected in the B-DASH Project*1 of Japan’s
Ministry of Land, Infrastructure, Transport and Tourism (MLIT).
In this demonstration research, JFE Engineering verified that high-efficiency power generation ispossible even in small-scale incinerators with a capacity on the order of 60 wet-t/d by introducing a
newly developed condensing-type steam turbine and a system that utilizes treated sewage water forcooling. This confirmed that the OdySSEA technology realizes so-called complete electric energy selfsufficiency, in which the amount of generated power exceeds the power consumption of the facility.*2

JFE GROUP CSR REPORT 2020

54

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）This research also confirmed that NOx generation can be suppressed while simultaneously
promoting decomposition of N2O by efficiently burning sewage by concentrated spot stirring injectionof air into the furnace from the optimum position and stirring the air in the furnace. While compact insize, OdySSEA realizes high performance, achieving reductions of more than 50 % in both N2O and NOx.
*1 B-DASH is an abbreviation for the “Breakthrough by Dynamic Approach in Sewage High Technology
Project” of the Ministry of Land, Infrastructure, Transport and Tourism (MLIT).
*2 Under conditions of an incineration rate of 140 wet-t/d and 73% water content.
■ System

Realization of Fully Automatic Operation of Waste Incinerator by New System Incorporating
Operators’ Know-how
In waste treatment facilities, the stable operation of the incinerator is performed by an automatic
combustion control system (ACC). However, because waste incinerators handle wastes of different
sizes, shapes and materials, operation must be monitored by the operators from the central control
room of the facility or from JFE Engineering’s Global Remote Center*, with manual interventions asnecessary.
JFE Engineering has been working on advancing its ACC technology and on developing a systemthat automates the manual intervention operations, which are conventionally performed by operators.
In October 2018, a new system that fully automated incinerator operation was rolled out in the Niigata
City Shinden Clean Center and began its demonstration run.
The system successfully ran without requiring any manual interventions by the operators andmaintained a combustion state more stable than a conventional system for more than two weeks. The
stability of steam generated by the boiler also improved, leading to an increase in the amount ofelectricity generated. In the future, we will continue to run and monitor the incinerator operation using
this system to verify its long-term stability and at the same time work on commercializing the system
and installing it in waste treatment facilities delivered by JFE Engineering and to newly constructed
plants.
JFE Engineering will continue to work on these advanced initiatives toward achieving total plant
automation. As a company that creates and supports the foundations for life, we will make full use of
our abundant knowledge and leading-edge technologies to contribute to the formation of a recycling
society and preservation of the global environment.
JFE GROUP CSR REPORT 2020

55

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）* Global Remote Center (GRC): A centralized monitoring center for various types of plants, which began
operation at the JFE Engineering Yokohama head office in March 2018. GRC performs remotemonitoring and operation support for object plants throughout Japan through a 24-hour system.

Conventional operation(manual interventions by operators)

Operation using the new system(fully automated)

Example tool of the newly developed system(screens that visualize the AI analysis performed on flame images)

The distribution area of controlled combustion temperature is more than 20% smaller→ combustion is more stable and generation is also more stable

JFE GROUP CSR REPORT 2020

56

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Construction of a New Recycled PET Resin Manufacturing Factory to Realize Bottle-to-Bottle
Recycling
In response to the marine pollution caused by plastic wastes, beverage manufactures have declared
their intention*1 to shift completely from using petroleum-based PET bottles to PET bottles made fromrecycled PET resin*2 by FY2030. Following this trend, Kyoei Industry Co., Ltd., which was the first inJapan to establish the bottle-to-bottle*3 mechanical recycling system*4, and J&T Recycling Corporation,
which has been supplying ingredient materials to the company for many years, have set up a new joint
venture company in an effort to realize the system and build a new recycled PET resin manufacturing
factory, the largest of its kind in Japan. The factory is to become the first recycling base for the JFE
Engineering Group and Kyoei Industry Group in the Chubu/Kansai region.
*1 Declaration of Plastic Resources Recycling by the Soft Drinks Industry in November 2018
*2 Recycled PET resin is the raw material recovered from recycled PET bottles. The PET bottles arecrushed, washed and dried to form flakes, which are then melted to even out quality and shaped
into granular forms called pellets; resins are manufactured by extracting moisture from these pellets.
*3 The creation of a new PET bottle from recycled bottles*4 Recovered resin obtained through material recycled (returning used products to material status via
pulverization, cleansing and other processing) is processed for a regulated period under a hightemperature and low pressure to remove impurities from the regenerated materials.

■ Bottle-to-Bottle Recycling

JFE GROUP CSR REPORT 202057

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesResource Recycling Businesses of JFE Engineering
For more on the resource recycling businesses, please refer to the following information.
JFE Engineering’s Website: Recycling (https://www.jfe-eng.co.jp/en/products/recycle/rec01.html)

Promotion of Renewable Energy
JFE Engineering has established an array of electrical power generation plants that use renewablesources such as waste, biomass, solar and geothermal and has been commissioned to manage theiroperations. In response to the increasing number of corporations becoming more environmentally awarein recent years, its subsidiary, Urban Energy Corporation, introduced the special electricity tariff Zero
Emission Plan in July 2018 for corporations and organizations, which supplies them with 100% renewableenergy. JFE Engineering will continue its electricity retail business using its renewable energy sources
through Urban Energy Corporation and contribute to renewable energy dissemination.
For more on this, please refer to the following information.
Urban Energy Corporation’ Website: Electricity Retail Business (Japanese only)(https://u-energy.jp/service/retail.html)

Regional Electricity Retail Businesses in Partnership with the Local Municipal Governments
JFE Engineering has established several regional electricity retail companies in partnership with local
municipal governments. It is actively involved in the regional electricity business, with a particular focus
on the distribution of renewable energy.
It sources its electricity from waste-fueled and other renewable-energy power generation plants thatit has built and distributes the electricity to local areas and public facilities, thus promoting local
production and consumption of electricity. Through these regional electricity businesses, JFE
Engineering intends to promote renewable energy, reduce electricity cost for public facilities, and expand
the region’s industrial infrastructure.
For more on this, please refer to the following information.
Urban Energy Corporation’s Website: Regional Electricity Supply Business (Japanese only)(https://u-energy.jp/service/municipality.html)

Waste Incinerator that Uses a Counter Current Combustion Method
Massive demand for waste incinerators has recently emerged to cope with such concerns as reducing
environmental impact, improving the efficiency of electricity generation, and lowering operational costs.
JFE Engineering became the first in the world to adopt the counter current combustion method,developed by deriving from high temperature air combustion technology, for waste incinerators, and it
successfully reduced NOx concentration in exhaust gas by 20% to 30%, compared to the conventional
method, while maintaining the same carbon monoxide (CO) concentration level. This eliminates the needfor equipment to reduce the NOx concentration in exhaust gas and makes possible a more compact
facility requiring less maintenance. In addition, the steam that had previously been consumed bydenitration equipment can now be fed to turbines to generate electricity.
For more on this, please refer to the following information.
JFE Engineering’s website: Won the Minister of Economy, Trade and Industry Prize in the 44th
Excellent Environmental Instrument Award (Japanese only)(https://www.jfe-eng.co.jp/news/2018/20180625.html)

JFE GROUP CSR REPORT 202058

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Shoji

Building a Global Supply Chain for the Steel Sheets Business
The key factor in initiatives for countering climate change, including those aimed at reducing CO2
emissions, is minimizing electricity loss and using generated electricity without loss.
Motors found in places such as power plants, factories and homes are responsible for 40–50% of allelectricity consumed globally. In Japan, the ratio is approximately 60%. Improving the efficiency of
motors by 1% in Japan that would contribute to the equivalent of a 500,000 kw-class power generation
plant in energy savings.
Technological advances are expected in electrical vehicle’s engine motors, for which demand is
expected to rise as we transition to a decarbonized society as well as in the various types of motors
used inside cars, which could be as many as 50 to 100 motors per car. We expect improvements inefficiency, smaller size and lighter weight.
In addition, in order to minimize energy loss while distributing electricity from source to factories andhomes, continuous improvement, not just at JFE, is required in transformers, where the most loss ofelectricity occurs, to make them more efficient.
JFE Steel’s electrical steel sheets significantly contribute to improving the efficiency of manufacturing
motors and transformers. In addition to supplying these high-quality products to customers, JFE Shoji
has the necessary infrastructure to ensure the stable supply of processed products tailored to eachcustomer’s requirements.
Customers who require high-quality electrical steel sheets, such as motor manufacturers andtransformer manufacturers, typically operate manufacturing facilities across the globe. We are aligningourselves to this trend and establishing a global quad-polar organization that includes Japan, America,
China and ASEAN. This enables us to respond to the specific needs of customers, which in turn willcontribute to tackling climate change.

Biomass FuelIn response to growing demand for biomass fuels by biomass power generation companies, JFE Shoji
imports palm kernel shells to Japan from Malaysia and Indonesia.
In addition, as the trend toward reducing CO2 emissions accelerates, demand for renewable energy
is rising, especially for biomass power generation which is not affected by weather conditions. We will
respond to this demand by exploring other types of biomass fuels, such as wood pellets, to ensure astable supply of biomass fuels.
Wood pellets are a biomass fuel that allows for the effective reuse of wood materials from thinningand pruning forests or waste materials from woodworking operations.
We will continue to supply fuel to biomass power generation companies, including JFE Engineering,and do our part in the JFE Group’s overall contribution toward realizing an eco-friendly society.
■ Shipping Bases for Palm Kernel Shells

JFE GROUP CSR REPORT 2020

59

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Expansion of Scrap Trading Helps in the Development of a Recycling Society
JFE Shoji’s recycling business for steel and aluminum scrap includes the export of steel scrap to Asian
countries, where it is sold for both offshore and domestic trading. Although steel scrap exported fromJapan is mainly transported by bulk carriers in general, timely shipments of small lots is now also
possible due to the container loading system introduced by JFE Shoji, contributing to the developmentof recycling societies in Asia.

JFE GROUP CSR REPORT 2020

60

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesMaterial Flow
JFE Steel works to reduce the environmental impact of its iron and steelmaking processes, including
through the effective use of resources. The company recycles 93.4% of the water it uses for production
and uses 99.7% of its co-products, such as ironsteel slag. In addition, 100% of co-product gas
generated during production is reused as fuel for reheating slabs, generating power for internal use andsupplying power to the public.

JFE Steel (Non-consolidated)

JFE GROUP CSR REPORT 2020

61

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Engineering (Head Office and Works)

JFE GROUP CSR REPORT 2020

62

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Climate Change (Climate Change Mitigation)
Basic Policy
As an enterprise engaged in iron and steel manufacturing, which emits massive volumes of CO2, theissue of climate change is a critical managerial concern from the perspective of business continuity. Our
steel business, which emits 99.9% of the Group’s total CO2 emissions, has been developing various
technologies for saving energy and reducing CO2 emissions. Applying these to steel manufacturing has
successfully reduced CO2 emission intensity to the lowest level worldwide.
Furthermore, the JFE Group has developed and maintained a variety of eco-friendly products andtechnologies, including high-performance steel materials that help save energy when customers use
them, as well as renewable energy power generation.
We will continue to develop and promote the widespread use of these processes and products whileat the same time seeking to turn this challenge into an opportunity to address climate change issues bydeploying the technologies we have fostered across the globe.

The JFE Group’s Medium- to Long-term Vision
Aiming to Reduce CO2 Emissions by 20% or More by FY2030 and To Be Carbon Neutral After 2050
The JFE Group intends to increase sustainability through solutions that address global climate change
issues while restructuring its business to respond to developments in the environment facing the steelbusiness. We regard this year to be a landmark year to further reinforce our efforts to tackle the issuesof climate change, and we are actively promoting initiatives for reducing CO2 emissions with the targets
set up as follows:■ JFE Group’s Target for Reducing CO2 Emission

Towards 2030
● In the steel business, which accounts for most of the JFE Group’s CO2 emissions, we are
exploring feasible scenarios with the aim of reducing CO2 emissions in fiscal 2030 by 20% ormore compared to fiscal 2013, maximizing the use of the best available technologies andinnovations.
● JFE continues to share the Japan Iron and Steel Federation’s commitment to a low-carbon
society and to play an active role. At the same time, JFE has launched a new project team to
reduce our CO2 emissions as much as possible for an individual company, and will start
examining various measures to achieve our targets.

Towards 2050
● In line with the social transformation to establish carbon-free infrastructure over the longterm, JFE will strive to be carbon neutral within the JFE Group as soon as possible after 2050.
● JFE is carrying out research and development to be ready to show a lineup of carbon neutral
technologies in its business processes well ahead of 2050.

JFE GROUP CSR REPORT 2020

63

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Roadmap for Reducing CO2 Emissions toward Realizing Carbon Neutral at the JFE Group

Examples of the JFE Group’s initiatives for achieving carbon neutral operations are as follows.

CO2 Reduction in the Conventional Iron and Steelmaking Process
Technologies that apply AI and data science
Introducing Data Science Technology at All Steelworks Blast Furnaces (P. 47)
Introducing a Guidance System to Manage Fuels and Electricity Consumptions in Steelworks (P. 48)
Technologies for expanding the use of scrap metal
Ecological and Economical Arc Furnace (ECOARC™) (https://steelplantech.com/en/product/ecoarc)
Improved energy efficiency at facilities
Conserving Energy by Reducing Energy Loss from Molten Steel Vessels (P. 49)

JFE GROUP CSR REPORT 202064

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Products and Technologies that Help Reduce Emissions
Eco Products
JNSF Core™ and J-STAR (https://www.jfe-holdings.co.jp/en/csr/pdf/2019/2019_09.pdf)
Steel Slag Hydrated Matrix (P. 50)
Use of Granulated Blast Furnace Slag to Reduce CO2 Emission (P. 51)
Precast Concrete Products (P. 52)
Hard carbon for next-generation lithium-ion batteries
Anode Material for All-polymer Battery, a Next-generation Lithium-ion Battery (P. 49)
Renewable Energy
Promotion of Renewable Energy (P. 58)
Regional Electricity Retail Businesses in Partnership with the Local Municipal Governments (P. 58)
JFE-METS (P. 54)
Use of Waste and Biomass
Waste Incinerator that Uses a Counter Current Combustion Method (P. 58)
Fully Automatic Operation of Waste Incinerator (P. 55)

Innovative Technologies and Super Innovative Technologies
Ferro coke
Ferro Coke Demonstration Plant (P. 46)
COURSE50
COURSE50 (https://www.jisf.or.jp/course50/index_en.html)
CCS (carbon capture and storage) and CCU (carbon capture and utilization)
Initiatives on CCU and CCS (NEDO Project) (P. 70)

Initiatives by industry groups
The Japan Iron and Steel Federation “Commitment to a Low Carbon Society”(https://www.jisf.or.jp/en/activity/climate/documents/tekkowg_ppt_en.pdf)

The Japan Iron and Steel Federation “Challenge Toward Zero-Carbon Steel”(https://www.jisf.or.jp/en/activity/climate/documents/JISFLong-termvisionforclimatechangemitigation.pdf)

Keidanren (Japan Business Federation) “Challenge Zero” (https://www.challenge-zero.jp/en/)

JFE GROUP CSR REPORT 2020

65

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Group’s Response to the TCFD
For more information, please refer to the following information.
JFE Group’s Response to the TCFD (P. 74)

Steel Industry Initiatives
For more information, please refer to the following information.
Steel Industry Initiatives (P. 90)

CO2 Emissions of the JFE Group
JFE’s CO2 emissions are mainly generated by its steel business. However, beyond reducing CO2
emissions from steel production process, each company sets specific targets corresponding with theiroperations to further save energy and reduce CO2 emissions.

■ CO2 Emissions of the JFE Group

Data cover 76 companies
JFE Steel and 30 major domestic and overseas subsidiaries
JFE Engineering and 10 major domestic subsidiaries
JFE Shoji and 33 major domestic and overseas subsidiaries.
Notes:• Data for JFE Steel include CO2 emissions from non-energy sources.
• Starting with FY2018, data for JFE Steel’s subsidiaries and JFE Engineering’s subsidiary include
CO2 emissions from non-energy sources.
• Data from FY2013 to FY2016 includes the Sendai Works of JFE Bars & Shapes Corporation.

JFE GROUP CSR REPORT 202066

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）■ Scope 3 Emissions of the JFE Group (FY2019)

Coverage:(Categories 1, 2, 3, 4, 5) JFE Steel, 25 JFE Steel domestic subsidiaries, JFE Engineering, andJFE Shoji(Category 6, 7) JFE Steel, 25 JFE Steel domestic subsidiaries, JFE Engineering, 10
JFE Engineering domestic subsidiaries, and JFE Shoji(Category 15) Japan Marine United, and 9 JFE Steel equity-method affiliates(7 domestic and 2 overseas)
Sources: Green Value Chain Platform (Ministry of the Environment) and others
For more on quantitative data related to CO2 emissions, please refer to the following information.
ESG Data: Environmental Data (P. 165)

Energy Savings and CO2 Reduction in Iron and Steelmaking
JFE SteelInitiatives to Save Energy and Reduce CO2
JFE Steel has always aggressively pursued CO2 reduction and energy savings, including the
introduction of energy-saving equipment.

JFE GROUP CSR REPORT 202067

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Energy Consumption and CO2 Emissions in FY2019
Energy consumption and CO2 emissions in iron and steelmaking are greatly influenced by production
volume. To accurately assess the effects of improvements due to operational technologies and capital
investments, JFE Steel is working to reduce its intensity (energy consumption and CO2 emissions perunit of production) and related energy-conservation activities.
JFE Steel’s crude steel production was 26.73 million tonnes in FY2019, up 1.6% from FY2018 andup 13% from FY1990. However, thanks to ongoing energy-saving activities, energy consumption was
down 8% and CO2 emissions were down 10% from FY1990.
The company’s energy consumption intensity in FY2019 was 19% below the FY1990 level at 23.2
GJ/t-steel, while CO2 emission intensity was down 18% to 2.03 t- CO2 /t-steel. The results prove thesuccess of JFE Steel’s energy-saving activities in recent years, including capital investments in energy
conservation and promotion of energy conservation through the visualization of the reheat furnace fuelbasic unit.
■ Production of Crude Steel of JFE Steel

Note: Figures for FY2013 to FY2016 were calculated by adding data for JFE Bars & Shapes Corporation’s
Sendai Works.

■ Energy Consumption and Unit Energy Consumption of JFE SteelNotes:
・Data for past fiscal years were retroactively revised for increased accuracy.
・Figures for FY2013 to FY2016 included data for JFE Bars & Shapes Corporation’s Sendai Works.
JFE GROUP CSR REPORT 2020

68

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ CO2 Emissions from Energy Sources and Unit CO2 Emissions of JFE SteelNotes:• The CO2 emissions and emission intensity in FY2019 are calculated using the CO2 emission
factor for electricity purchased in FY2018, adopted by the Japan Iron and Steel Federation’s
Commitment to a Low Carbon Society.
• FY2018 data was revised by applying the CO2 emission factor for electricity purchased in
FY2018, adopted by the Japan Iron and Steel Federation’s Commitment to a Low Carbon
Society.
• Figures for FY2013 to FY2016 included data for JFE Bars & Shapes Corporation’s Sendai Works.

CO2 Emissions from Non-energy Sources
Lime and dolomite, used as auxiliary materials in blast furnaces and converters, emit CO2 duringdecomposition. JFE Steel manages these emissions as CO2 derived from non-energy sources.
For more on quantitative data related to CO2 emissions, please refer to the following information.
ESG Data: Environmental Data (P. 165)

JFE GROUP CSR REPORT 2020

69

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

CO2 Reduction Initiatives
JFE SteelInitiatives toward CCU/CCS
In order to reduce CO2 emissions from the steel manufacturing process, JFE Steel is actively engaged
in the development of new technologies to separate and recover CO2 from blast furnace gas. This is
in line with the JISF’s COURSE50 project (CO2 Ultimate Reduction in Steelmaking Process by
Innovative Technology for Cool Earth 50), which focuses on hydrogen reduction of iron ore andseparation and recovering of CO2 from blast furnace gas. JFE Steel has been working on developing
for practical use a physical adsorption technology for separating and capturing CO2, which could thenbe fed to carbon capture and storage (CCS).
More recently, JFE Steel has also initiated R&D into the effective use of CO2 separated andrecovered from blast furnace gas and is one of the first domestic steel manufacturers to explore thisfield. JFE Steel is a participating member of NEDO*1 projects such as for the development of nextgeneration thermal power generation technologies, development of basic technologies for nextgeneration thermal power generation, and development of CO2 utilization technology, and it isworking on an initiative together with RITE*2 to develop new technologies for separating andrecovering CO2 from blast furnace gas and utilizing it to synthesize methanol (CH3OH).
In this project, JFE Steel is developing technologies that lower the cost of CO2 separation andrecovery that meets the objectives of CCU and process design for effective use of CO2. The expertisein CO2 separation and recovery technologies it has acquired through the COURSE50 project isapplied to CCU.
*1 New Energy and Industrial Technology Development Organization*2 Research Institute of Innovative Technology for the Earth■ CCU Technology

JFE GROUP CSR REPORT 202070

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Engineering
JFE Engineering strives to reduce CO2 emissions in society through its clients and their daily
operations by providing them with eco-friendly products and technologies, including those that harness
renewable energy and energy-saving products.
For example, if all of the renewable energy-related plants that JFE Engineering has constructed by
FY2019, including those currently under construction, were in operation, their estimated contribution*
to CO2 reduction would mount up to 4.13 million tonnes per year. Furthermore, JFE Engineering strives
to reduce its own CO2 emissions in accordance with the Energy Conservation Law, from its head office,branch offices, and works and has been achieving the reduction target set by the Energy Conservation
Law every year since FY2015. And JFE Engineering’s Yokohama head office was presented with the
Yokohama Global Warming Countermeasures Award for FY2019 in recognition of these initiatives.
Companies of the group each have their own energy saving initiatives that are appropriate for theirbusinesses to make their contribution in reducing overall CO2 emissions.
* For renewable energy power generation plants, the characteristics of each plant is taken into
consideration while estimating their CO2 emissions.
■ JFE Engineering Group’s CO2 Emissions from Energy Sources (Thousand t- CO2)

Data cover CO2 emissions from energy sources by JFE Engineering and 10 consolidated subsidiaries inJapan.

■Contribution to CO2 Emission Reductions by Renewable Energy Plants (FY2019)

JFE GROUP CSR REPORT 202071

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Shoji
Under the environmental strategies formulated in 2001, JFE Shoji offices in Japan have consistently
worked to reduce their use of energy and paper as well as strictly manage waste separation.
Efforts to cut energy consumption such as leave-on-time days, prohibition of night work, andpinpoint lighting have become firmly rooted. In FY2019, reductions in environmental impact wereprimarily achieved by improving the working environment through 5S activities, reducing power
consumption by replacing computers, and promoting activities to raise operational efficiency byintroducing robotic process automation (RPA).
JFE Shoji has also sought to raise awareness of environmental activities by creating a pocket card
listing environmental strategies, fiscal year targets, and environmental initiatives related to office andtrading activities. The card has been distributed to all employees.

■Electric Power Consumption by JFE Shoji (Thousand kWh)

■ CO2 Emissions of the JFE Shoji Group (FY2019)

The graph shows CO2 emissions from electric power consumption by JFE Shoji and 33 consolidated
subsidiaries (steel-processing companies) in Japan and overseas.

JFE GROUP CSR REPORT 202072

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Products and Technologies that Reduce CO2 Emissions
For more information, please refer to the following information.
Development and Provision of Eco-friendly Processes and Products (P. 46)

Related Links
The Japan Iron and Steel Federation Website: Climate Change Policy(https://www.jisf.or.jp/en/activity/climate/index.html)

JFE GROUP CSR REPORT 202073

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Groupʼs Response to the TCFD
The JFE Group leverages its innovative technology to address climate change and is committed tocreating a resilient, sustainable society. The Group also seeks to disclose information on how it willaddress climate change risks and opportunities in accordance with TCFD recommendations, including
scenario analysis.

JFE’s Initiatives on Climate Change and Future Response
As an enterprise engaged in iron and steel manufacturing, which is associated with emitting massive
volumes of CO2, the issue of climate change is a critical managerial concern from the perspective of
business continuity. Our steel business, which emits 99.9% of the Group’s total CO2 emissions, hasbeen developing various technologies for saving energy and reducing CO2 emissions. We have actively
addressed the risks by applying these technologies to steel manufacturing and have also successfully
reduced CO2 emission intensity to the lowest level worldwide. We will continue to develop processes toreduce environmental impact further while at the same time seeking to turn this challenge into an
opportunity for addressing climate change issues by deploying the technologies we have fosteredacross the globe.
The JFE Group has developed and maintained a variety of eco-friendly products and technologies,
including high-performance steel materials that help save energy when customers use them, as well as
renewable energy power generation. We view the current challenges as an opportunity and arecontributing to solving the climate change problem. Automobiles are expected to become lighter inweight while the number of electric cars increases. We will support this by improving the functions of
the JFE Group’s high tensile strength steel sheets and electrical steel sheets. In addition, we will help
reduce our carbon footprint by further disseminating renewable energies and implementing recycling
initiatives as well as energy conservation.
The Group will continue to develop and disseminate the technologies for achieving the 2℃ target
stipulated in the Paris Agreement and contribute to the prevention of global warming. We will also
support national resilience by providing steel for social infrastructure and construction to address the
emerging risks associated with the growing severity of meteorological disasters.
For more on this, please refer to the following information.
Climate Change (Climate Change Mitigation) (P. 63)
Addressing Climate Change Issues：
Development and Provision of Eco-friendly
Technologies and Products Related to CO2 Emissions：
Processes and Products (P. 46)

Environmental Movement across the World Surrounding JFE’s Business
1997
2008
2013
2015
2018
2020

Kyoto Protocol adopted at COP3 in Kyoto
JISF’s Voluntary Action Plan launched
JISF’s Commitment to a Low Carbon Society launched
Paris Agreement adopted at COP21
JISF announced the Long-term Vision for Climate Change Mitigation
Keidanren launches the Challenge Zero initiative

The “Challenge Zero (Innovation Challenges Towards a Net Zero Carbon Society)” is a new joint
initiative by Keidanren (Japan Business Federation) and the Japanese government for proactively
publicizing and supporting companies and organizations that pursue innovative actions toward realizing
a decarbonized society, which is the long-term goal of the Paris Agreement.
The JFE Group endorses the Challenge Zero declaration and will rise to the challenge in pursuit ofinnovation.
JFE GROUP CSR REPORT 202074

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
The JFE Group publishes information on specific initiatives through the following website.
Challenge Zero (https://www.challenge-zero.jp/en/member/34)

Disclosure Consistent with TCFD Recommendations

On May 27, 2019, JFE Holdings announced its
endorsement for the final report of the Task Forceon Climate-related Financial Disclosures (TCFD)*.
* The TCFD was established by the Financial Stability Board (FSB) at the request of G20 finance ministers and central bankgovernors.

TCFD Recommendations
Climate-related risks and opportunities will significantly impact medium- to long-term corporate
finance. To reduce the risk of instability in the financial market, the G20 called on the FSB to establish
the TCFD. The TCFD considers disclosure methodologies that can be used to appropriately assessclimate-related risks and opportunities and releases its findings as a final recommendations report.
It is important for investors to accurately understand the financial impact of climate-related risks
and the opportunities of investee companies when they make financial decisions. In this context, thetask force recommends disclosures to be made in four core elements of organizational management:
governance, strategy, risk management, and metrics and targets.
For the TCFD content index, please use the following link.
Guideline Content Indices (P. 210)

Governance
The JFE Group actively strives to exist harmoniously with the global environment as well as to raise
living standards and advance societies under the JFE Group Standards of Business Conduct. We areaware that protecting the global environment by reinforcing our environmental protection activities andaddressing climate change issues are extremely important for creating a sustainable society.
In FY2016 we identified the mitigation of global warming as a material CSR issue to facilitate the
PDCA cycle and promote appropriate management of ongoing initiatives, such as reducing CO2 in theiron and steelmaking process and developing and providing eco-friendly products.
The JFE Group Environmental Committee, chaired by the president of JFE Holdings and operating
under the JFE Group CSR Council, supervises and guides these initiatives by deliberating goals,
monitoring progress and improving the Group’s overall environmental performance.
Key issues for corporate management such as climate change are deliberated at the GroupManagement Strategy Committee as well and reported to the Board of Directors. The board oversees
environmental challenges by discussing the reported material. Additionally, specialized committees set
up by JFE Group operating companies and affiliates implement specific activities.

JFE GROUP CSR REPORT 202075

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Examples of climate change-related agendas reported to the Board of Directors for deliberation
 Declaration of endorsement for the final TCFD recommendation report Information disclosure consistent with TCFD recommendations (scenario analysis andother information)
For Outside Executive Group Interview on the status of supervision by the Board of Directors over thegovernance system and ESG challenges for the whole Group, please refer to the following information.
Corporate Governance System (P. 149)
Framework for Environmental Management (P. 39)
JFE Group Report 2020 “Outside executives share perspectives on ESG as the foundation of value
creation for the JFE Group”(https://www.jfe-holdings.co.jp/en/investor/library/group-report/2020/pdf/9.pdf)

Monitoring Method for Core Issues Related to Climate Change
Issues that may affect management are being monitored by the JFE Group CSR Council, GroupManagement Strategy Committee and the Management Committee. As for the method, measures are
implemented based on a quarterly report on climate change-related issues deliberated by theEnvironmental Committee and other organs of each Group company. The JFE Group Environmental
Committee collects information on risks and strengthens controls to reduce the frequency and impactof the risks and maximize opportunities.

Countermeasures Based on Monitoring
1. Group-wide deliberations
2. Monitoring penetration of policies within Group
3. Monitoring deployment of policies throughout GroupFor more on our risk management system, please refer to the following information.
Risk Management (P. 161)

Strategies
Risks and opportunities associated with climate change issues are integrated into the Group’sbusiness strategies as follows. We formulated the JFE Group Sixth Medium-term Business Plan as ourbusiness management policy for FY2018 to FY2020. As part of our plan to strengthen the businessstructure for sustainable growth, we have placed high priority on contributing to the establishment of asustainable society. Our efforts to address climate change issues have been incorporated into ourbusiness strategy by pursuing what we term as “ongoing ESG initiatives” as a key measure. We selectimportant factors that may affect business to identify and evaluate risks and opportunities byadvancing information disclosure in line with the TCFD recommendations, including scenario analysis.
The JFE Group gives high priority to protecting the global environment and has a strategy in place
for reducing environmental impact by developing eco-friendly products and process technologies andproviding material recycling solutions, in addition to reducing CO2 emissions in the steelmaking
process and recycling water resources and energy. Furthermore, the JFE Group expresses its views on
public policies concerning climate change issues and environmental protection through the Japan Iron
and Steel Federation and actively participates in related activities.

JFE GROUP CSR REPORT 202076

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Scenario Analysis
Setting the Scenario
Scenario analysis is performed to provide an accurate understanding of climate-related risks andopportunities and assess implications to the current business strategy, thereby enabling theorganization to establish business strategies that reflect this assessment. We selected the following
two scenarios by considering the fact that our business has potentially high exposure to the impacts ofclimate change.
Both scenarios are based on those developed by the International Energy Agency (IEA). Analysis isconducted under the assumption that a uniform carbon price is implemented in major emitting
countries toward the realization of the 2℃ target.
Selected Scenario

Reference
Scenario

2℃ Scenario

4℃ Scenario

Transition
Risks

Transition scenarios developed by
the IEA• Sustainable Development
Scenario (SDS)*1• 2℃ Scenario (2DS)*2

Transition scenarios developed by
the IEA• New Polices Scenario (NPS)*1• Reference Technology Scenario(RTS)*2

Physical
Risks

Climate change projection scenario developed by the Intergovernmental
Panel on Climate Change (IPCC)
Representative Concentration Pathways (RCP) Scenario*3

How Society will Look

Dynamic policies will be adopted
and technical innovations will
progress to limit the averagetemperature rise by the end of thiscentury to 2℃ and realize
sustainable development.
Assume a society in which ourbusiness is affected by socialchanges accompanying transition
to a decarbonized society.
• World-wide/industry-wide
uniform carbon pricing*4• Increase in the ratio of sales ofelectric vehicles to overallvehicle sales

Despite new policies implemented
in each country based on
approaches under the Paris
Agreement, average temperaturerises about 4℃ by the end of thiscentury.
Assume a society in which ourbusiness is affected bytemperaturerise and other climate change.
• Increase in the occurrence offlooding• Sea level rise

*1 Source: IEA “World Energy Outlook 2018”*2 Source: IEA “Energy Technology Perspectives 2017”*3 Source: IPCC Fifth Assessment Report*4 If prices of carbon differ from country to country, there will be a gap in international
competitiveness between countries that impose strict CO2 emissions regulations and less strict
regulations. This will result in carbon leakage where CO2 emissions of a strict climate policy
country is reduced due to decreased production and investment, while production at andinvestment to other countries with laxer emission constraints increase, in turn increasing the CO2
emissions in those countries. One reference scenario, SDS, assumes that carbon pricing is
implemented in developed countries and some developing countries. By taking this into account,
we formulated the 2℃ scenario based on the assumption that a uniform carbon pricing is
introduced to major emitting countries to push toward achieving the target of two degrees.

JFE GROUP CSR REPORT 202077

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Scope of Business and Period for Analysis
This analysis covers the following businesses: the steel business by JFE Steel, the engineering businessby JFE Engineering, the trading business by JFE Shoji, and businesses carried out by some of the otherGroup companies. The period covered is up to 2050.

Relevance with JISFʼs Long-term Vision for Climate Change Mitigation
The JFE Group’s steel business is led by its operating company, JFE Steel. JFE Steel is a member of theJapan Iron and Steel Federation (JISF), which has committed to the achievement of a low carbon
society with the target year of 2030. In November 2018, JISF also formulated and published the Longterm Vision for Climate Change Mitigation for 2030 and beyond. JFE Steel was a core member when
the long-term vision was formulated.
While JISF’s Long-term Vision for Climate Change Mitigation represents the industry’s challenge
toward realizing zero-carbon steel with an eye on 2100, our scenario analysis is intended to ensure
resiliency in our Group’s business strategy at the mid-point of the long-term challenge.
■ CO2 Emissions Based on Long-term Scenarios for Climate Change Mitigation*1 BAU Scenario: A scenario based on the idea of “business as usual”*2 BAT Max Introduction Scenario: A scenario based on maximum introduction of the best available
technology

JFE GROUP CSR REPORT 202078

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Initiatives to Achieve the Long-term Vision for Climate Change Mitigation

Process to Identify Key Factors that Impact the Business
Step 1: Examine the entire value chain from a holistic perspective and sort out factors that impact thebusinesses under analysis(For more information on risks and opportunities in the value chain, refer to
JFE Group Value Chain (P. 6))
Step 2: Examine all factors from a holistic perspective and identify key factors by taking into
consideration the level of impact and stakeholder expectations and concerns
2℃ Scenario

4℃ Scenario
5. Unstable raw materials
procurement due to increased
occurrence of climatic hazards

Impact on Procurement

Impact on Direct Operation

1. Decarbonization of iron andsteelmaking process
2. Increased needs for effective
utilization of steel scrap

6. Damage to production bases
and offices caused by climatic
hazards

Impact on Product andService Demand

3. Change in demand forautomotive steel, etc.
4. Increase in demand forsolutions to promotedecarbonization

7. National resilience

Level of impact

Expectations and concerns ofstakeholders

Axis for identifying
key factors

Axis for identifying key factors:● Level of impact (possibility of risks and opportunities arising × Level of impact if it manifests)● Expectations and concerns of stakeholders
JFE GROUP CSR REPORT 2020

79

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesResults of Scenario Analysis

JFE GROUP CSR REPORT 202080

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Overview of a Scenario Analysis Assessment
FOCUS Key Factor (1) Decarbonization of Iron and Steelmaking Process
We are developing innovative technologies to emerge as the pioneer in realizing a decarbonizedsociety. With a strong financial base to meet investments for implementing innovativetechnologies, we are significantly contributing to the transition to a decarbonized society.

JFE Steel has been committed to developing energy-saving technologies toward increasing theefficiency of the iron and steelmaking process and decarbonization. These initiatives have helped JFE
Steel acquire technologies that realize the world’s top energy efficiency in iron and steelmaking. To
further push ahead with decarbonation, the Company will enhance the development of innovative ironmaking processes such as COURSE50 and ferro coke, which are expected to reduce the carbon
footprint through hydrogen reduction and CCS.
COURSE50 applies hydrogen reduction technology and CCS to reduce CO2 emissions by about 10%
and 20%, respectively, through each technology, for a total reduction of about 30%. The first facility is
expected to come online by 2030, followed by the implementation of other plants by 2050,
corresponding with the timing for upgrading blast furnace facilities. Ferro coke is a technology forsignificantly reducing CO2 emissions by improving the reduction rate of iron ore put into blast furnaces.
In addition to these technologies, we will push forward to establish a hydrogen reduction iron making
technology which we will aim to put it into practice after 2030 in order to realize the ultimate goal of
creating zero-carbon steel.
We consider implementing innovative technologies as critical and will advance with this strategy
together with the government. Furthermore, we have a sufficient financial base to meet necessary
investments.
A medium-scale pilot plant with the capacity to produce 300 tonnes of ferro coke per day wasconstructed in the Fukuyama district of the JFE Steel West Japan Works, and experimental runs will
begin in FY2020 toward commercialization.

■ Example of Developing an Innovative Technology: Ferro Coke Production Process

JFE GROUP CSR REPORT 202081

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Cost competitiveness will be maintained in case uniform carbon pricing is introduced across all
countries.

Uniform carbon pricing is being discussed or introduced around the world. If it is introduced to major
emitting countries, the increase in operating cost will be reflected reasonably on the price of steel
products both in Japan and overseas, thus maintaining the Company’s cost competitiveness. In
addition, since CO2 emissions per unit of steel production is the lowest of all competing materials, steel
retains its superior position in cost competitiveness.
On the other hand, the introduction of carbon pricing in a manner that is biased toward certain
regions would have a major impact on the JFE Group and particularly on its steel business, which maylead to the loss of its cost competitiveness. For this reason, we must remain vigilant to future
developments.

FOCUS Key Factor (2) Increased Need for Effective Utilization of Steel Scrap
While the use of steel scrap increases, demand for crude steel will also rise over the long-term.
This will result in an increase for pig iron production by blast furnace (converter steel).
Furthermore, the entire JFE Group will benefit from opportunities arising from the expanded useof electric furnaces, and it will utilize the construction technology of electric furnaces while
expanding the scrap logistics business.

Steel scrap, a raw material for electric furnace steel, is used efficiently, as it is almost completely
recovered in the steel value chain. For society, which expects the realization of the under 2℃ scenario,
steel is utilized as a basic material that will help achieve the SDGs. Steel accumulation will increase as
well as the amount of scrap used. Global steel demand is expected to grow alongside the overall
growth in the population and economy, and production of pig iron (converter furnace steel) is also
expected to rise to support the development of a sustainable society (JISF: Long-term Vision for
Climate Change Mitigation). In addition, under the current technology, the quantity of high-grade steel
materials is only feasible using converter furnace steel. This steel and electric furnace steel will coexist and be used in applicable places.
The JFE Group is viewing the increase in demand for electric furnace steel as well as the worldwide increase in the amount of scrap generated as an opportunity, and it will enhance its electric
furnace steel production while applying its engineering technology for constructing an entirely cuttingedge, energy-saving electric furnace facility with the ultimate goal of opening up other business
opportunities. Moreover, the Group will advance the development of technologies to utilize scrap andincrease the industry-wide use of this material.
Meanwhile, expanding the use of scrap will bring about an increase in logistics for distributing it,
and this will provide an opportunity for JFE Shoji to expand its logistics business.
■ Estimated Supply and Demand for Steel Production and Scrap Use

JFE GROUP CSR REPORT 202082

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

FOCUS Key Factor (3) Change in Demand for Automotive Steel
Demand for electrical steel sheets for EV motors as well as special steel is increasing as
global car sales rise. The increase in the intensity of high tensile strength automotive steel
sheets contributes to further weight reductions.

The trend of increasing electric vehicles has given rise to rapidly expanding demand for electrical steel
sheets used in EV motors. JFE Steel has already marketed the JNE series of non-oriented electricalsteel sheets, used in building motors, as part of its eco-product lineup. It also commands a strong
share of the market.
On the other hand, it has been pointed out that an increase in EVs may lead to a decline in theamount of special steel used in engine components. The amount of this type of steel, used in hybrid
vehicles and electric vehicles, is 80% and 60% of gasoline cars, respectively. We believe that the risk
level for this matter, however, is low since car sales are expected to increase even under the 2℃
scenario and total demand for special steel for cars is increasing.
Nonetheless, the situation for EV remains the same in terms of strong demand for weight reductionof body structure. JFE Steel has developed a cold-rolled steel sheet boasting 1.5 GPa-grade tensile
strength as an eco-product and has put it into practical use as an automotive steel sheet. With its highstrength, the product can significantly reduce the weight of a car frame and thus dramatically reduce
CO2 emissions from cars in motion.

■ Estimated World Demand for Automotive
Special Steel■ Estimated World Demand for Automotive
Electrical Steel Sheets

Vertical axis: Steel demand (comparison by year with the year 2020 as 1.00)
Source: Estimated by JFE Holdings based on reports by Strategic Commission for the New Era ofAutomobiles (METI)

Estimated by JFE Holdings based on reports by Strategic Commission for the New Era ofAutomobiles (METI)

Steel is a highly recyclable material that can be reborn as many different products over and over again
with no loss in its intrinsic quality. In the future, public resource recycling is expected to increase
toward establishing a decarbonized society. We believe that the high recyclability of steel will gain
attention once again in light of this transition.

JFE GROUP CSR REPORT 202083

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Effect of trend to use multi-materials is limited.

Aluminum and carbon fiber reinforced plastic are potential alternative materials for reducing the weightof cars. It has been pointed out, however, that the production cost of these materials and the amountof CO2 emitted throughout their life cycles is higher than those of steel. Therefore, under the 2℃
scenario, which assumes the introduction of a carbon price, the price differential between steel andalternative materials will be larger. Under this scenario, while the trend of using multi-materials may
show some progress for luxury cars, their use would be limited for economy cars. Moreover,considering a situation in which all panels used for doors and other parts of a luxury car were changed
to aluminum, the effect on weight reduction could be expected to be 5% of all materials used in luxury
and economy cars together. Multiplied by the number of cars produced, the impact over the total
demand for automotive steel can be assumed to be limited.

FOCUS Key Factor (4) Increase in Demand for Solutions to Enhance Decarbonization
Contribution through the provision of solutions (renewable energy power generation, Multisite
Energy Total Service, recycling plants, and energy-saving steel technologies“Renewable Energy Power Generation”
Demand for power generation plants using non-carbon emitting renewable energies is expected toincrease. The JFE Group engages in designing, procuring, constructing, and operating biomass*1,
geothermal*2, and solar power*3 generation plants in its engineering domain.
We are also working on increasing power output at waste processing facilities from the perspectiveof resource recycling and the effective utilization of resources. JFE Engineering is striving to develop a
fully automated operation*4 to facilitate higher power output at incinerators.
Moreover, we are utilizing renewable energy as the main power source for our retail electricity
business *5 and in helping to establish and operate regional electricity retail companies*6 focused on
local production and consumption of electricity based on renewable energy.

Biomass power generation plants
Waste-to-energy power generation plant*1 The JFE Engineering Corporation’s Website: Biomass(https://www.jfe-eng.co.jp/en/products/power/s02.html)*2 The JFE Engineering Corporation’s Website: Power generation plant(https://www.jfe-eng.co.jp/en/products/power/gene01.html)*3 The JFE Technos Corporation’s Website: Solar power generation (Japanese only)(https://www.jfe-technos.co.jp/photovoltaics)

JFE GROUP CSR REPORT 202084

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）*4 The JFE Engineering Corporation’s Website: Operation & maintenance(https://www.jfe-eng.co.jp/en/products/environment/ope03.html)*5 The Urban Energy Corporation’s Website: Electricity retail business (Japanese only)(https://u-energy.jp/service/retail.html)*6 The Urban Energy Corporation’s Website: Regional electric power support business(targeting local governments) (Japanese only) (https://u-energy.jp/service/municipality.html)“Multisite Energy Total Service”
In addition to the conventional service of optimizing energy use for single sites, JFE Engineering offers
the Multisite Energy Total Service (JFE-METS)*1, which optimizes energy use for multiple sites throughcentralized management. We realize overall energy savings and CO2 reduction by analyzing energy
consumption at multiple sites and achieving total optimization by installing and operating energyrelated equipment at each site to circulate energy throughout the network, including remote locations.
*1 The JFE Engineering Corporation’s Website: JFE-METS (Japanese only)(https://www.jfe-eng.co.jp/news/2019/PDF/20200130.pdf)“Recycling Plants”
We are working on reducing the additional use of materials derived from fossil fuels by using recycledmaterials in the production of plastic products. JFE Engineering undertakes the construction ofrecycling plants*1 from design to procurement and construction as well as operation, and J&T Recycling
Corporation operates a plastic recycling business*2.
Industry-wide decarbonization cannot be achieved only through technical developments in the
manufacturing process alone. Therefore, we believe that demand for CCU and CCS facilities will
increase as they facilitate the efficient use and storage of CO2. JFE Engineering is able to undertake theentire process of building CCU and CCS facilities from design and procurement to construction.
*1 The JFE Engineering Corporation’s Website: Recycling(https://www.jfe-eng.co.jp/en/products/recycle/rec01.html)*2 The J&T Recycling Corporation’s Website: Recycling(https://www.jt-kankyo.co.jp/en/business/products/)“Energy-saving Steel Technologies”
From the perspective of the steel industry, there is space for disseminating eco solutions (energysaving steel technologies) in nations such as China, where close to 50% of the world’s crude steel isproduced, and India, where further growth in production is expected. The potential CO2 reduction
achieved by internationally transferring and disseminating advanced energy-saving technologies widelyused in Japan will exceed 400 million t- CO2 world-wide. Japan is estimated to contribute to the
reduction of approximately 80 million t- CO2 in 2030 through these technologies.

JFE GROUP CSR REPORT 202085

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

FOCUS Key Factor (5) Unstable Raw Material Procurement due to Increased Occurrence of
Climatic Hazards
Ongoing initiatives to address the issue, such as alternative procurement and dispersed
supplier bases, and increasing plant capacity

In Australia, our major source country for raw materials, the occurrence of typhoons is predicted to
double. We may be vulnerable in terms of continuous production and suffer a loss if production andshipping are interrupted for too long.
To address this issue, we are promoting alternative procurement and dispersed supplier bases.
Alternative
procurementand dispersed
supplier bases:

Respond to disaster by carrying out spot procurement from China’s port stocks,
increasing procurement from closer source countries such as Russia and Indonesia
and front-loading the purchase and/or increasing the purchase contract of different
brands from outposts in unaffected regions of Australia. Also, use the stock andexternal yard of the Group company Philippine Sinter Corporation.

FOCUS Key Factor (6) Damage to Production Bases and Offices Caused by Climatic Hazards
Measures against flood and drought in progress; impact of flooding caused by rising sea levels
can be addressed with current countermeasures.

We are taking action to minimize damage under the assumption that typhoons and heavy rains will
become stronger and that the occurrence of disasters comparable to the torrential rain in westernJapan in 2018 will rise. We have currently invested approximately 6.5 billion yen for disaster prevention
at steelworks and strengthened drainage facilities and other assets. About 3.5 billion yen of separate
investment has already been made to prepare for water shortages at steelworks by installing
desalination facilities at some of the steelworks. Although no severe drought disaster has struck sincethe 1994 disaster, we are preparing to minimize any damage even if the frequency of occurrence should
increase.
All steelworks are exposed to the risk of floods associated with rising sea levels because of theirlocation in coastal areas. The estimated sea level rise by 2050 is 20 to 30 cm (70 cm by 2100 if the
impact of climate change manifests itself at the highest level.) We believe that current measuresagainst storm surge, which generates more sea level rise, are sufficient to address the risk. However,
we will continue analyzing climatic hazards going forward so as to prepare for the changing
circumstances.

FOCUS Key Factor (7) National Resilience
Contribute to infrastructure enhancement with products such as a high-strength H-shaped
steel, high-strength steel pipe pile, and hybrid tide embankments.

The JFE Group takes seriously the increased frequency and severity of recent climatic hazards in Japan.
Also, the daily life of the Japanese citizenry is being exposed to a heightened risk of danger. The JFEGroup defines its mission as promoting disaster prevention and mitigation as well as national resilience
to maintain vital infrastructure that are essential to daily life and economic activities.
The JFE Group will gather its collective energy to protect key structures from earthquakes using
structural steel such as a high-strength H-shaped steel and steel pipe piles as well as steel sheet piles.
It will also help to reinforce embankments that are prone to bursting and provide disaster prevention
products such as hybrid tide embankments *1 and steel slit dams, in addition to reconstructing
infrastructure.

JFE GROUP CSR REPORT 202086

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

Hybrid tide embankments
Steel slit dams
*1 The JFE Engineering Corporation’s Website: Steel infrastructure (Japanese only)(https://www.jfe-eng.co.jp/products/bridge/co01.html)

Risk Management
JFE Holdings is responsible for comprehensive risk management in accordance with its Basic Policy for
Building Internal Control Systems. The JFE Group CSR Council chaired by the president of JFE
Holdings, collects specific information for the purpose of reducing the frequency and impact of risks.
The executive officer responsible for risk works to identify potential ESG risks such as those
associated with climate change. As necessary, the relevant committee confirms and evaluates risks
and discusses and makes decisions on countermeasures.
The Board of Directors supervises initiatives on ESG risks such as those related to climate change
and CSR by receiving reports and deliberating over key issues.
Climate-related risks are identified and evaluated based on a scenario analysis conducted under theframework recommended by the TCFD. Important factors that may affect management are selected forfurther analysis and used in formulating business strategies for the future.
For more on this, please refer to the following information.
CSR Structure (P. 29)
CSR structure including ESG risk management：
Enterprise risk management：
Risk Management (P. 161)
Environmental management including climate change issues：
Environmental Management (P. 39)

JFE GROUP CSR REPORT 202087

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Metrics and Targets
The JFE Group’s steel business is led by its operating company, JFE Steel, which is a member of theJapan Iron and Steel Federation (JISF). The JFE Group is promoting the JISF’s Commitment to a Low
Carbon Society, which focuses on the Three Ecos initiatives and the development of innovative newiron and steelmaking processes. Under the initiative, the JISF plans to reduce emissions by 3 million tCO2 compared to the BAU (Business As Usual emissions: Estimated level of emissions in the absenceof any special measure) by FY2020 and by 9 million t- CO2 by FY2030. JFE Steel is aggressively
pursuing activities toward these goals.
In addition, JISF has formulated and announced its long-term vision for climate change mitigationin 2030 and beyond, which is intended to realize zero-carbon steel. JFE Steel played an important rolein formulating this vision.
The JFE Group intends to increase sustainability through solutions that address global climatechange issues while restructuring its business to respond to developments in the environment facing
the steel business. We regard this year to be a landmark year to further reinforce our efforts to tackle
the issues of climate change, and we are actively promoting initiatives for reducing CO2 emissions
with the targets set up as follows:■ JFE Group's Target for Reducing CO2 Emissions

Towards 2030
● In the steel business, which accounts for most of the JFE Group’s CO2 emissions, we are
exploring feasible scenarios with the aim of reducing CO2 emissions in fiscal 2030 by 20% ormore compared to fiscal 2013, maximizing the use of the best available technologies andinnovations.
● JFE continues to share the Japan Iron and Steel Federation’s commitment to a low-carbon
society and to play an active role. At the same time, JFE has launched a new project team to
reduce our CO2 emissions as much as possible for an individual company, and will start
examining various measures to achieve our targets.

Toward 2050
● In line with the social transformation to establish carbon-free infrastructure over the long term,
JFE will strive to be carbon neutral within the JFE Group as soon as possible after 2050.
● JFE is carrying out research and development to be ready to show a lineup of carbon neutral
technologies in its business processes well ahead of 2050.

For more on this, please refer to the following information.
Steel Industry Initiatives (P. 90)
Commitment to a Low Carbon Society：Targets and Results Related to Climate Change：
Material CSR Issues (P. 22)
Initiatives on Climate Change：
Climate Change (Climate Change Mitigation) (P. 63)

JFE GROUP CSR REPORT 202088

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Addressing Climate Change Issues
The JFE Group considers addressing climate change issues as an extremely importantmanagerial challenge. We respond to risks and opportunities to enable sustainablegrowth and disclose information about our related actions.
Addressing climate change issues is an extremely
important managerial challenge for the JFE Group,
not only from the perspective of business risks but
also in terms of opportunities to contribute to therealization of a sustainable society.
The TCFD’s final recommendations, published in2017, encourage companies to disclose theirresilience strategies for responding to climatechange issues through scenario analysis. The JFEGroup announced its endorsement of therecommendations in May 2019, and the CSR Report2019 was our first disclosures in line with TCFD
recommendations. The report provides informationon our risk management for the 2℃ and 4℃
scenarios in addition to our commitment toaddressing issues through the development of an
innovative iron and steelmaking process, ecofriendly products and technologies, and efforts forstrengthening national resilience. We regard thisyear to be a landmark year to further reinforce ourefforts to tackle the issues of climate change, andintend to advance into a new stage.
In the steel business, which accounts for most of
the JFE Group’s CO2 emissions, we are exploring
feasible scenarios with the aim of reducing CO2
emissions in fiscal 2030 by 20% or more comparedto fiscal 2013. We will also pursue diverse initiatives
to strive to be carbon neutral within the JFE Group
as soon as possible after 2050.
In addition, we will continue enhancing our
scenario analysis to evaluate the impact on ourbusiness strategy and use the results in formulating
future strategies while actively engaging in thenecessary initiatives. We hope this information will
be noted by many investors and other stakeholders
and encourage dialogues for deepening
understanding of the measures that the Group is
taking.

Hiroyuki Fujiwara
Senior Vice President of
JFE Holdings, Inc.

JFE GROUP CSR REPORT 202089

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Steel Industry Initiatives
The Japan Iron and Steel Federation (JISF) Initiatives
Long-term Vision for Climate Change Mitigation
In addition to ongoing efforts to achieve the Commitment to a Low Carbon Society, JISF has formulated
and announced the long-term vision for climate change mitigation in 2030 and beyond, which isintended to realize zero-carbon steel. JFE Steel played an important role in formulating this vision.
Mid-term (−2030) Initiatives••

Promotion and expansion of The Three Ecos Initiatives.
Development and implementation of innovative new iron andsteelmaking processes.

Long-term (−2050) Initiatives••

Promotion of innovative new iron and steelmaking processes.
Development of super innovative iron and steelmaking
processes and CCS/CCU technologies.

Final (−2100) Vision••

Realization of zero-carbon steel.
Implementation of super innovative iron and steelmaking
processes.

The Commitment to a Low Carbon Society
The Japan Iron and Steel Federation (JISF) is promoting its Commitment to a Low Carbon Society,which focuses on the Three Ecos initiatives and the development of innovative new iron andsteelmaking processes. JFE Steel is actively implementing initiatives to help achieve the plan’s targets.
■ CO2 Reduction Medium- to Long-term Targets (The Japan Iron and Steel Federation’s“Commitment to a Low Carbon Society”)
Three Ecos

Further improve energy
efficiency by taking
full advantage ofcutting-edge
technologies

Goal

Targets

Eco Processes

FY2020(phase-I)

Reduce CO2 emissions
by 5 million t-CO2
compared to the BAU
benchmark• Energy-saving:
3 million t-CO2• Efficient use ofwaste plastics, etc.:
2 million t-CO2

Eco Products

Eco Solutions

Provide highperformance steel
materials
that result in highperforming endproducts
and thus reducing CO2
emissions

Reduce CO2 indeveloping countries
through the transfer
and application ofworld-leading, energysaving Eco Process
technologies

The use of major highperformance steel
materials to contributeto a CO2 reductionof approximately 34.0
million t-CO2

Estimated CO2
reduction impact of 70
million t-CO2

JFE GROUP CSR REPORT 202090

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）Three Ecos

Eco Processes

Eco Products

Eco Solutions

FY2030(phase-II)

Reduce CO2 emissions
by 9 million t-CO2
compared to the BAU
benchmarkThe use of major highperformance steel
materials to contributeto a CO2 reductionof approximately 42.0
million t-CO2

Estimated CO2
reduction impact of 80
million t-CO2

Status as of FY2018
year-end

Reduced 2.21 million tCO2 emissions(energy conservationetc.), compared to the
BAU benchmark

Domestic andinternational use
contributed
to a CO2 reduction of
31.06 million t-CO2

CO2 reduction impact of
65.53 million t-CO2

Targets

Source: Public data from the Japan Iron and Steel Federation (JISF)

Assessment of Commitment to a Low Carbon Society Results (JISF)
In FY2018 emissions by the Japanese steel industry decreased by 2.21 million t- CO2 compared to the
BAU emissions* benchmark. Various self-improvement efforts, such as raising the efficiency of cokeovens and generation facilities, are steadily contributing to this reduction. JFE Steel is actively working
on these self-improvement efforts as well as investing in research and development for new energysaving technologies.
* Business As Usual emissions: Estimated level of emissions in the absence of any special measure

Revolutionary Iron and Steelmaking Process Development
COURSE50
About 30% of CO2 emissions can be reduced through hydrogen reduction along with separation andcapture of CO2 from blast furnace gases. The first facility is expected to come online by 2030, followedby other plants by 2050.

Ferro Coke
The Japanese steel industry intends to develop ferro coke that accelerates and lowers thetemperatures of the reduction reaction in a blast furnace as well as its operational processes toconserve energy further and expand the use of low-rank materials. Currently, a medium-scale plantcapable of producing 300 tonnes of ferro coke per day has being constructed in JFE Steel’s West Japan
Works (Fukuyama district) and test for practice use aimed for the FY2020 operation will be started.

JFE GROUP CSR REPORT 202091

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Reduced CO2 Emissions through High-performance Steel Materials (Effects of Eco Products)
The Japan Iron and Steel Federation (JISF) expects the use of high-performance steel materials to
reduce CO2 emissions. It is estimated that the use of 5 major high-performance steel materials for cars,transformers, ships, power generator boilers, and trains in Japan and overseas (FY2018 production:
6.97 million tonnes, 6.8% of crude steel production) helped to reduce CO2 emissions by 31.06 million
tonnes (10.10 million tonnes in Japan, 20.96 million tonnes overseas) in FY2018.
•••

Estimates created by the Institute of Energy Economics, Japan
Materials included are steel sheets for automobiles, directional electrical steel sheets, thick steel
sheets for shipbuilding, steel tubes for boilers, stainless steel sheets.
For the domestic figures, the calculation includes data from FY1990 onward. For the export figures,the calculation includes data from FY2003 onward for automobile and shipbuilding, from FY1998
onward for steel pipes for boilers and from FY1996 onward for electrical steel sheets.

CO2 Reduction Resulting from the Use of Five Highperformance Steel Materials in Japan and
Abroad (FY2018)

JFE GROUP CSR REPORT 202092

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesGlobal Scale Initiatives
Addressing Global Warming
ISO 14404 is an international standard proposed by the Japan Iron and Steel Foundation (JISF) to theInternational Organization for Standardization (ISO) as a methodology for the globally unified
calculation of CO2 intensity from iron and steel production, ultimately to assess the energy efficiency ofsteelworks. The Japanese steel industry is addressing global warming through international publicprivate collaborations, including ISO 14404-based assessment of steelworks in developing countries
and recommending specific technologies best suited to India and ASEAN countries. It is continuing thiseffort together with the Ministry of Economy, Trade and Industry (METI) in order to enhance ISO 14404
so that it can be applied to steel manufacturing facilities with more complex structures.
JFE Steel is also addressing global warming by participating in international activities, such as theJapan India Public and Private Collaborative Meeting, the Japan-ASEAN Steel Initiative and the JapanChina Steel Industries Exchange. In addition, JFE Steel is involved as a member of World Steel
Association (WSA)’s Climate Action Program, which uses ISO 14404 as the standard for measurement
and calculation.

JFE SteelContribution to the Development of Calculation in LCA
In order to accurately evaluate the environmental impact of products, assessment and quantification isrequired over their entire life cycles, from raw resource mining to material production, productmanufacture, use and final disposal. Life Cycle Assessment (LCA) is one method for conducting thisevaluation.
After final products such as automobiles and buildings finish their mission in society, all of theirsteel components can be recycled and reused. This closed loop recycling ability is an excellent
characteristic of steel materials. If LCA is conducted and this characteristic is taken into account, steel
can be viewed as having extremely low environmental impact compared to other materials.

JFE GROUP CSR REPORT 202093

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
The standard for appropriately considering this ability of steel products to undergo closed-loop
recycling was published in November 2018. ISO 20915 (life cycle inventory calculation methodology forsteel products) was developed by The Japan Iron and Steel Foundation (JISF) with JFE Steel playing amajor role, and provides a life cycle inventory (LCI) calculation method specific to steel products thattakes into account the effects of recycling.
In addition, the Japan domestic version of this standard, JIS Q 20915 (life cycle inventory calculation
methodology for steel products), was published in June 2019.
Notes: JFE Steel, together with the WSA (World Steel Association, comprising of approximately 170
steel manufacturers and steel related organizations) and the Japan Iron and Steel Foundation(JISF), is working to establish LCA as an international standard methodology for calculating LCI
for steel materials.
■ Life Cycle of Steel Materials

Related Links
The Japan Iron and Steel Federation (JISF) website:Climate Change Policy page(https://www.jisf.or.jp/en/activity/climate/index.html)

The Japan Iron and Steel Federation (JISF) website:LCA of Steel Products page(https://www.jisf.or.jp/en/activity/lca/index.html)

The Japan Iron and Steel Federation (JISF) website:Publication of ISO 20915(https://www.jisf.or.jp/en/activity/lca/iso/index.html)

The Japan Iron and Steel Federation (JISF) website:Publication of 2JIS Q 20915(https://www.jisf.or.jp/en/activity/lca/iso/index.html)

JFE GROUP CSR REPORT 202094

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesPrevention of Pollution (Protecting the Global Atmosphereand Water)
Basic Policy
The JFE Group regards co-existence and mutual prosperity with local communities, the global
environment, and society at large as a critical managerial challenge in terms of business continuity. It
strives to control air and water pollutant emissions and aggressively invests in environmental
protection. Related internal controls and education are steadily being strengthened as well. Also, thetransfer and widespread application of proprietary technologies, mainly in developing countries,
contribute to pollution prevention on a global scale.

Controlling Air Emissions
JFE SteelJFE Steel is controlling emissions by installing low-nitrogen oxides (NOx) burners in reheat furnaces,
switching to low-sulfur fuels and deploying desulfurization and denitration devices in sintering plants,
all major sources of sulfur oxides (SOx) and NOx emissions.
In addition, the company suppresses dust dispersion through measures that include enhancing onsite cleaning, installing sprinklers and windbreak fences in raw material yards, and improving theperformance of dust collectors.

■ SOx Emissions* 13 JFE Steel consolidated subsidiaries in Japan.

JFE GROUP CSR REPORT 202095

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）■ NOx Emissions* 13 JFE Steel consolidated subsidiaries in Japan.

JFE Engineering
To ensure compliance with the Air Pollution Control Law and relevant local regulations, JFE Engineering
properly manages facilities that emit soot and smoke, by regularly measuring NOx emissions, etc., at its
Yokohama head office, Turumi works, and Tsu works. In addition, efforts are being made atconstruction sites to protect the environment through the use of construction machinery and on-site
vehicles in compliance with the Automotive NOx and PM Law and Act on Regulation, Etc. of Emissions
From Non-road Special Motor Vehicles (Off-Road Vehicle Law).

Preventing Water Pollution
JFE SteelJFE Steel strives to reduce its environmental impact on waterways by thoroughly purifying water usedin iron and steelmaking processes before releasing it into public waterways or sewers. The company
has concluded agreements with the administrative entity in each area that set out more rigorous
effluent standards, compared to those stipulated under the Water Pollution Prevention Act. It alsoestablished a strict voluntary control standard to improve water quality. For FY2019, chemical oxygen
demand (COD), the water-quality index for wastewater, was 3.2 tonnes per day.

JFE GROUP CSR REPORT 202096

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）■ Chemical Oxygen Demand (COD)* 12 JFE Steel consolidated subsidiaries in Japan.

JFE Engineering
Wastewater from the JFE Engineering Yokohama head office, Tsurumi works, and Tsu works, isreleased into public waterways or sewer systems. Nitric oxide, phosphorus, and COD in the wastewater
are measured on a regular basis and effectively managed in accordance with the Water Pollution
Prevention Act and Sewerage Act.
■ Chemical Oxygen Demand (COD) in Wastewater Released Publicly

This report uses the maximum value of each year.

JFE GROUP CSR REPORT 202097

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesManagement of Chemical Substances and Emission Control
JFE SteelJFE Steel lowers its environmental impact by voluntarily reducing the chemical substances it releases.
Release and transfer amounts of substances subject to Japan’s Law concerning Pollutant Release andTransfer Register (PRTR Law) are reported in accordance with the law. In FY2019, chemical
substances released into the atmosphere and public waterways totaled 488 tonnes.
The Japan Iron and Steel Federation formulated a voluntary action plan to reduce VOC emissions by
30% from FY2000 levels by FY2010. As part of this action plan, JFE Steel set a target for reducing
emissions to 1,078 tonnes or less. As a result of our initiatives, we achieved a significant reduction thatexceeded the 30% reduction target in FY2010 and have been consistently cutting VOC emissions, bymore than 50%. We will continue with follow-up efforts to prevent any increase in emissions.
■ Release and Transfer Amounts of PRTR-registered Substances at JFE Steel* 18 JFE Steel consolidated subsidiaries in Japan.

■ VOC Emissions

JFE GROUP CSR REPORT 202098

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Engineering
Major chemical substances subject to the PRTR Law for the JFE Engineering works in Tsurumi and Tsu
include organic solvents such as xylene used for painting products, manganese and its compounds
generated during welding. We report the release and transfer amounts of these substances inaccordance with the law.
■ Release and Transfer Amounts of PRTR-registered Substances at JFE Engineering* 4 JFE Engineering consolidated subsidiaries in Japan.
For more on quantitative data related to PRTR, please refer to the following information.
ESG Data: Environmental Data (P. 165)

PCB Waste Management at JFE
Polychlorinated biphenyl (PCB) waste is properly stored and managed at the JFE Group’s facilities.
High concentration PCB waste is treated in accordance with guidelines set by the Japan Environmental
Storage & Safety Corporation (JESCO). The Yokohama Eco Clean Plant and Mizushima Eco-Works of
J&T Recycling Corporation treat insulating oil contaminated with slight amounts of PCB, helping to
reduce pollutants both in and outside the JFE Group.

Products and Technologies (Protecting the Environment)
For more on products and technologies related to environmental protection, please refer to thefollowing information.
Development and Provision of Eco-friendly Processes and Products (P. 46)

JFE GROUP CSR REPORT 202099

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Efficient Use of Resources (Resource Recycling)
Basic Policy
Economic growth in emerging countries is intensifying the need to conserve nonrenewable resources
and prevent pollution. Iron can easily be separated and is thus highly recyclable. It can be recycled andreused to make other steel products infinite times (closed-loop recycling). The JFE Group is leveraging
each Group company’s strengths to enhance resource recycling through recycling co-products fromiron and steelmaking, reducing waste at construction sites, and promoting the global recycling of steel
scrap.

Promoting Resource Recycling
Each operating company of the JFE Group carries out resource recycling suited to its particularbusiness. We continue to pursue increasingly efficient uses of resources in both the production andproduct/service phases of its businesses, including steel scrap recycling, biomass fuel production andwaste-to-energy power generation.

Reducing Generation and Emission of Co-products and Reusing Co-products
JFE SteelJFE Steel carefully controls the generation and emission of iron and steelmaking slag (coproduct), iron
dust from blast furnaces and converters, sludge from water treatment facilities, and other coproducts.
The target rate for recycling is 99% or more. Dust and sludge with high iron content are recycled as raw
materials for steelmaking. Iron and steelmaking slag is effectively recycled for reuse in cement andother construction materials. We are also promoting their use as environment recovery material such as
Marine Stone™, which works effectively as a base for the adhesion of organisms and for improving themarine environment. As a result of such efforts, the company achieved a 99.7% recycling rate for slag,
dust, and sludge in FY2019, consistently maintaining the target of 99% or higher.
■Landfill of Co-products and Recycling Rates* 25 JFE Steel consolidated subsidiaries in Japan.
For more on quantitative data related to co-products, please refer to the following information.
ESG Data: Environmental Data (P. 165)
JFE GROUP CSR REPORT 2020100

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Promoting Recycling
JFE Engineering
Most of JFE Engineering’s waste is either rubble and sludge discharged from construction sites orindustrial waste discharged by the Tsurumi and Tsu works. We strive to reduce industrial waste andpromote resource recycling through various measures, which include setting environmental goals forrecycling rates and properly separating the waste on-site before sending it to disposal companies
known for achieving high recycling rates.
The City of Yokohama has named JFE Engineering’s Yokohama head office as a Workplace with
Excellent 3R Activities every year since FY2012 to recognize its waste reduction, reuse, and recycling
activities. The JFE Engineering Group is also working to realize a recycling-oriented society through its
PET bottle and food waste recycling initiatives.
■ JFE Engineering Group Waste Disposal for FY2019

Data cover JFE Engineering and 10 consolidated subsidiareis in Japan.
■ Waste Generated at Construction Sites

For more on waste generated at the steelworks, please refer to the following information.
ESG Data: Environmental Data (P. 165)

JFE GROUP CSR REPORT 2020

101

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Products and Technologies (Resource Recycling)
For more on this, please refer to the following information.
Development and Provision of Eco-friendly Processes and Products (P. 46)

Resource Recycling Solutions
The JFE Group is involved in establishing a recycling oriented society through a variety of initiatives.
Steelworks promotes the efficient use of raw materials, water, and other resources in the process ofiron and steelmaking in addition to encouraging the application of recycled resources such as usedplastics for blast furnaces. Moreover, we are striving to more efficiently use co-products generated in
the iron and steelmaking process through initiatives such as the international recycling of steel scrap.
In the engineering field, in addition to constructing and providing customers with waste incineration
plants and plants for treating sludge, we are developing a waste recycling business and an energy
supply business to offer resource recycling solutions.

JFE GROUP CSR REPORT 2020102

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Water Security (Conservation of Water Resources)
Basic Policy
The JFE Group uses large quantities of fresh water for cooling and cleansing products and facilities in
its core business of steel manufacturing. For this reason, the efficient use of water resources with due
consideration to the source of the water and stakeholders in the area is a key challenge. In response,
we have established a system for reducing water intake by maximizing the use of recycled water at oursteelworks, and we manage the system by setting high goals for water recycling rates.
And while we have always taken measures against meteorological disasters such as droughts andfloods at our manufacturing sites in Japan, we are further reinforcing them in anticipation of theincreased frequency and severity of weather events associated with climate change by securing
alternative means and raising the height of embankments. We also seek to identify water-related risks
throughout our business sites and supply chain in Japan and overseas, such as the risk of drought at
the source of water intake and pollution at the point of discharge. In areas under water stress, we will
respond appropriately through dialogue with stakeholders.

Response to Water Risks
The JFE Group recognizes the issue of water resources as a risk that may significantly impact
operations, and we have taken action against meteorological disasters such as droughts and floods. In
recent years, we have been seeking to adequately identify and manage water risks based on theassumption that disasters due to climate change will increase in frequency and severity.
With regard to Group risk management, the JFE Group Environmental Committee, under theleadership of the CEO, who heads the JFE Group CSR Council, discusses, supervises, and guides
Group-wide environmental initiatives, including the proper use of water resources.
As part of overall risk management, we identify, analyze and evaluate water risks based on past
incidents of droughts and floods in the JFE Group’s businesses, forecast data from the Meteorological
Agency and results of our scenario analysis. In particular, we consider damage to business sites anddisruption of the supply chain caused by restrictions on water intake due to droughts or increasing
severity of meteorological disasters as key risks. In response, we are further reinforcing measures suchas using recycled water, securing alternative means, and strengthening drainage facilities.
Furthermore, to ensure the stability of our steel business’s procurement throughout its supply chain,
we are striving to reduce risks by evaluating them based on past data concerning water-related
disasters and results of scenario analysis for materials such as coal and iron ore, securing alternativeroutes of procurement and diversifying suppliers.

JFE Steel

Water Risks and Mitigation
JFE Steel identifies and evaluates water-related risks based on past incidents of damage caused bydroughts and floods, forecast data from the Meteorological Agency and results of scenario analysis.
We conduct a further evaluation of water risks around each manufacturing site from different
perspectives by also using the World Resource Institute (WRI)’s Aqueduct, a mapping tool forevaluating overall water risks from droughts and floods in each region around the world. While Japan
has not been designated as a water-scarce region by the WRI, there are risks of water shortages andflooding associated with climate conditions. JFE Steel identifies steelworks having risks that are
affected by climate change and mitigates their risks by creating a BCP.

JFE GROUP CSR REPORT 2020

103

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Efficient Use of Water Resources
The JFE Group uses large quantities of fresh water for cooling and cleansing products and facilities
during the process of steel manufacturing, which is its core business. Therefore, it is important toefficiently use water resources with due consideration to the source of water and stakeholders in thearea. To address this, we have established a system for reducing water intake by maximizing the use
recycled water at our steelworks, and we manage the system by setting high goals for water recycling
rates.

JFE SteelCyclic Use of Water
A large amount of water is used in the iron and steelmaking process to cool facilities and process
products. The target water recycling rate at JFE Steel is 90% or more, which is extremely highconsidering the amount evaporated when water is used. We are striving to improve the recycling rate byadopting purification processes such as biological and chemical wastewater treatments, and we havebeen successfully achieving the target. Our recycling rate of industrial water in FY2019 maintained ahigh level of 93.4%.
■ Industrial Water Accepted/Circulated*1 Industrial water circulated (%) = (Total amount used − industrial water accepted)/total amount used × 100*2 25 JFE Steel consolidated subsidiaries in Japan.

JFE GROUP CSR REPORT 2020104

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Engineering

Water Consumption
JFE Engineering and its subsidiaries strive to efficiently use water in their business operations at eachsite.
■ JFE Engineering Group’s Water Consumption for FY2019

Data cover JFE Engineering and 7 consolidated subsidiaries in Japan.

For more on quantitative data related to water, please refer to the following information.
ESG Data: Environmental Data (P. 165)

JFE GROUP CSR REPORT 2020

105

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Biodiversity (Initiatives to Preserve Biodiversity)
Basic Policy
The JFE Group recognizes biodiversity preservation as a key challenge and conducts assessments tominimize the ecological impact from business activity. Our initiatives include cooperating with thecommunity to monitor biodiversity and carry out preservation activities in order to minimize ecologicalimpact around the steelworks, as key facilities for our business, and in surrounding areas. It also
involves developing iron and steelmaking slag products that can help restore the marine environment.
Furthermore, outside of our business operations, we launched a joint research program with the local
government and are conducting environment-related training for local communities.

Initiatives to Preserve Biodiversity
The JFE Group engages with members of the community in activities to preserve biodiversity.
JFE Steel

Environmental Impact Assessment
To minimize the ecological impact of our business activities on surrounding areas, we are monitoring
biodiversity around all of our business sites and planting trees while also preserving rare species in thecompound. An environmental impact assessment is conducted in accordance with laws and regulations
before launching construction of a new manufacturing site or business. We assess the biodiversity ofthe surrounding areas as well as our premises to fully understand the situation and to implement thenecessary measures for preserving the ecosystem.

Replanted a Rare Species of Orchid Found at a Planned Construction Site
We conducted an environmental prediction and evaluation for the renovation of an aging facility, Plant
No. 1 in the JFE Ohgishima Thermal Power Plant, in accordance with the Environmental Impact
Assessment Act and Electricity Business Act. As a result, the Kugenuma orchid, a plant listed in Japan’s
Ministry of Environment Red List 2017 as an endangered species, was discovered at the planned
construction site for power generation facilities. To preserve the orchids, we replanted them in adifferent location of the site that had a similar environment.

Kugenuma orchid

JFE GROUP CSR REPORT 2020106

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Firefly Festival
JFE Steel has opened its Environment Pond at the Chita Works to the community for a firefly festival
every year since 2014. Children at the event have the opportunity to release fireflies.

Participants observing fireflies

JFE Engineering

Initiatives in Relation to Construction Works
For large-scale construction or construction work carried out near watersheds or mountainsides,
customers and/or the relevant authorities may conduct preliminary investigations depending on theimportance of preserving the surrounding environment. Various preservation conditions may then be
required, including the protection of living creatures.
In an example of how JFE Engineering has responded to such requirements, the company proposed
a construction method that minimizes the impact of noise or drainage pollution on biodiversity. We
respect the proposed conditions and thoughtfully consider biodiversity preservation by keeping theimpact of construction works at a minimum. The condition of biodiversity in areas surrounding thesteelworks or its premises are checked, and necessary measures are taken to ensure preservation.

Biotope for the Children’s Learning Experience
Since 2009, JFE Engineering has been inviting children in the community to learn about the ecosystem
at a biotope, Dragonfly Pond, along the JFE Dragonfly Path in the Tsurumi Works.
In 2019, the JFE Dragonfly Path Fan Club, a group mainly composed of neighborhood residents,organized a research event that involved capturing dragonflies in order to learn about their ecology andthe local environment. Furthermore, an organization dedicated to dragonflies, composed of members
from businesses, residents, administrations, and professionals, is conducting a habitat study to help
improve the quality of a green space along the Keihin coastal areas as well as to support biodiversity.
The organization captures dragonflies that gather around the biotope and tags them for follow-up
surveys.

JFE GROUP CSR REPORT 2020107

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE 21st Century Foundation
The JFE 21st Century Foundation has been cosponsoring the dragonfly organization as part of its
activities to support cultural development in FY2019.
For more on social-contribution activities related to JFE 21st Century Foundation, please refer to the following
information.
Community: JFE 21st Century Foundation (P. 143)

Endorsing and Participating in External Initiatives
As a member of the Keidanren Committee on Nature Conservation, the JFE Group endorses the
Declaration of Biodiversity by Keidanren and Action Policy and actively engages in the conservation ofnature and biodiversity. It also participates in the Japan Business and Biodiversity Partnership andexchanges information with various parties, including NGOs, researchers, and public agencies.

Products and Technologies (Preserving Biodiversity)
The JFE Group endorses and participates in the Challenge Zero initiative that is being jointly sponsoredby Keidanren and the Japanese government. And we are collaborating with Yokohama City on a projectthat uses steel slag to improve the marine environment while also developing various products aimed atconserving biodiversity.
For more on products and technologies related to environmental protection, please refer to thefollowing information.
Development and Provision of Eco-friendly Processes and Products (P. 46)

JFE GROUP CSR REPORT 2020108

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Communication
The JFE Group gives utmost priority to communicating with all stakeholders, including in mattersrelating to the environment.

Disclosing Environmental Data
The East Japan Works of JFE Steel discloses realtime environmental data on local air and water quality.
Visitors can review this information in the first-floor lobby of the Visitor Center in the Chiba District
and in the Amenity Hall and the first-floor lobby of the Keihin Building in the Keihin District.

Environmental data display in the Leihin District

Disclosure and Exchange of Information“ecobeing” Environmental Website
The JFE Group cooperates with the “ecobeing” environmental website, which helps to broaden
awareness of eco-activities. One of the tabs on the website called “ecopeople” contains a series ofarticles featuring persons from different fields.
Please see the following for further details.
“ecobeing” (Japanese only) (http://www.ecobeing.net/)Sponsoring “Midori no Komichi” Environmental Diary
The JFE Group sponsors the “Midori no Komichi (Green Trail)” environmental diary project hosted by
Green Cross Japan with the hope that children will become more aware of environmental issues bykeeping diaries of their activities and thoughts about ecology.
Please see the following for further details.
“Midori no Komichi” Environmental Diary (Japanese only) (http://www.midorinokomichi.net/)

JFE GROUP CSR REPORT 2020109

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Participating in the Environmental Exhibition EcoPro 2019 and the Tokyo Bay Thanks Giving Day
The JFE Group exhibited its environmentally friendly products and technologies at EcoPro 2019, Japan’slargest environmental exhibition, in December 2019. The booth’s theme was “JFE Technologies for a
Sustainable Society – Produce → Use → Recycle.” In addition, we supported Green Cross Japan byrunning tours for children, called the EcoPro EcoKids Tour.
And we showcased our efforts to revive marine environments using steel slags and our contribution
to preserving biodiversity during Tokyo Bay Thanks Giving Day 2019, an event aimed at reviving themarine flora and fauna around Tokyo Bay and held in October.

Many children stopped by the JFE Group’s
exhibition booth at EcoPro 2019.

Children were amazed by the overwhelming
audiovisuals of the domed theater.

The JFE booth for Tokyo Bay Thanks Giving Day
was popular with families.
Coral and tropical fish around Marine Block™
(iron and steelmaking slag) attracts visitors
every year.

JFE GROUP CSR REPORT 2020110

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesCustomer Responsibility (Provide Quality Products andEnhance Customer Satisfaction)
JFE Group Standards of Business Conduct(1) Provide quality products and services
Earn the trust and regard of customers by endeavoring to provide safe, high-quality products andservices based on superior technology, and by fully respecting and protecting the privacy of personaland customer information. Also, leverage our superior technologies for the sustainable growthof the Group and society.

Quality Initiatives
The JFE Group manages quality by ensuring compliance with quality standards set by each operatingcompany. All manufacturing sites that require ISO 9001 certification for their quality management havebeen duly certified.

Strengthening Quality Assurance System
JFE Steel
To serve customers by meeting their quality requirements and delivering products that boast theworld’s highest quality, JFE Steel has established a quality assurance system with advanced sensors
for process monitoring, in addition to its ongoing efforts to develop new products and advanced
manufacturing technologies.
The company’s quality assurance system is being continually improved based on the Guidelines forEnhancing Quality Assurance Systems, issued by the Japan Iron and Steel Foundation (JISF). Moreover,in an effort to enhance reliability in its product testing, the company has introduced high-precisionequipment and is working to thoroughly eliminate human error and data tampering by automating
various testing components, including reporting.
JFE Steel has received all quality assurance certifications required for steel products, including the
JIS mark and approvals from ship classification bodies, regarding its quality management system
based on ISO 9001. In response to customer demand, the company has also received certification
under the national standards of relevant foreign countries.
JFE Engineering
Products and services that JFE Engineering designs, procures, manufactures or constructs must comply
with all required rules and regulations, and quality must satisfy the needs of our customers. Under thiscorporate policy, the company continually strives to improve the quality of its products and services.
For example, certified inspectors conduct inspections at each phase of a plant construction project,including the design, construction, and test-run phases. Immediately prior to final delivery to thecustomer, a witness inspection is conducted so that the customer can be directly assured of its quality
with their own eyes.
JFE GROUP CSR REPORT 2020111

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
In addition, JFE Engineering has published quality-management manuals based on the specificcharacteristics of each product and obtained ISO 9001 certification for each product category.
To further strengthen its quality assurance system, JFE Engineering is raising employee awarenessthrough training while also seeking to prevent omissions in inspection data and data tampering by
introducing an electronic document processing system into quality inspections.
JFE Shoji
JFE Shoji is constantly striving to enhance the level of its quality assurance. Its processing centers inJapan and abroad are systematizing and automating operations to eliminate human errors. Raising
employee awareness is essential for preventing human error at every stage, including receiving orders,processing and shipping. The company continues to strengthen quality education for employees byintroducing case studies of non-conformance at other companies as well as at Group companies inJapan and abroad. JFE Shoji also conducts a quality audit at all relevant Group companies in andoutside of Japan to confirm the quality of each processing center and to provide advice. Moreover, it
follows up as necessary by continuously monitoring the progress of improvements to maintain andenhance the level of quality assurance.

Ensuring Stable Supply
JFE Steel
Under its Sixth Medium-term Business Plan, JFE Steel is continuously strengthening its manufacturingbase while also seeking to bolster the capabilities of the West Japan Works by maximizing its
performance. The company is establishing a system for promoting stable furnace operations andintroducing technologies and facilities for detecting abnormalities at an early stage of operation.
Through these activities JFE Steel will realize stable facility operations and production to continue
providing high-quality products to customers.
Meanwhile, the global spread of COVID-19 has caused a rapid downturn in the world economy andstagnation in the Japanese economy, resulting in dramatically significant declines in demand. We have
responded with a thorough commitment to efficiency from the rolling process upward by front-loading
renovation work for the No. 4 blast furnace in the Kurashiki district and banking (suspending
operations) at the No. 4 blast furnace in the Fukuyama district to shift temporarily from a system ofeight furnaces to six.
JFE Engineering
As a licensed contractor undertaking mechanical, civil engineering, and construction work, JFE
Engineering is required by the Construction Business Act to assign dedicated managing engineers atconstruction sites to oversee the technical aspects of construction work. The smooth implementationof plant construction projects depends on licensed specialists. The company is always striving tosecure the necessary human resources by encouraging employees to acquire qualifications bygranting expenses and through mid-career hiring of licensed personnel.
JFE Shoji
JFE Shoji will maintain and expand its processing and distribution operations to ensure stable supply bystrengthening regional marketing channels, making capital investments for the Group and raising
efficiency to realize an optimal system for sales and processing.
JFE GROUP CSR REPORT 2020112

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Improving Customer Satisfaction
JFE Steel

Aggressive Advancement of DX
JFE Steel’s Digital Transformation (DX) strategy revolves around technological innovation based on theactive introduction of IoT, AI and data science (DS) and the application of data assets. Compared tomills in other countries, we possess an enormous amount of know-how and data accumulated throughmany years of production operations. Our abundant data assets are the source of our value creation.
We will harness the latest DS and AI technologies to make versatile use of such data in achieving
innovative improvements in productivity, enhancing quality and ensuring stable operations to raise ourcompetitiveness.
■ Advancement of Digital Transformation (DX)

Testing and Research Centers for Collaboration with Customers on Product Development
JFE Steel collaborates with customers in research and development. The Customers’ Solutions Lab(CSL) for auto industry customers, the Steel Structural Materials Solutions Center (THiNK SMART) for
infrastructure-related customers and the JFE Welding Institute - Center for Integrity against Fatigue
and Fracture (JWI-CIF2) are located in eastern Japan, while the Customer Center Fukuyama (CCF),
which develops materials and conducts applied technology research, is in western Japan. Using thesefacilities to strengthen early vendor involvement (EVI)* enables the company to quickly identify
customer needs and develop products based on cutting-edge evaluation techniques and innovative
production processes.
* Customer participation in product development is from an early stage to facilitate innovative new
methods, functions, processes and evaluations for new steel materials.
JFE GROUP CSR REPORT 2020113

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

Customers’ Solutions Lab (CSL)

Unified Customer Care
JFE Steel regularly conducts customer questionnaires and interviews to draft strategies for greater
customer satisfaction. Business strategies are shared among the sales divisions, business sectors andsteelworks to facilitate unified customer care and proposals that leverage the collective strengths of
the JFE Group.

Training Sales Personnel to Excel in Customer Relations
To strengthen customer-oriented sales efforts, the Sales Department holds training sessions by
position and job, according to their work experience, targeting sales personnel from the headquarters
and branch offices (i.e., newly appointed sales employees, mid-rank sales employees, managers andother office heads). The department also provides group training in Japan for regional employees ofoverseas offices to enhance job performance. Training goals include developing abilities in areas suchas engaging in technical conversations, picking up clues from customer relations and using them inproduct development, offering suggestions to improve logistics and distribution, and analyzing financial
indicators and costs.

JFE Engineering

Company Assessments Based on Customer Evaluations
JFE Engineering uses customer surveys, interviews, and contractor performance evaluation forms tocollect and assess data on the company’s construction management, quality, advanced technologies
and innovation. Each division analyzes and applies the data for quality improvement, new productdevelopment and the overall strengthening of aftersales service, to ultimately enhance customer
satisfaction.

JFE GROUP CSR REPORT 2020114

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Shoji

Meeting Customer Needs
To respond quickly to diversifying markets and increasingly sophisticated requests from customers, JFE
Shoji is strengthening its entire supply chain from materials procurement to processing and distribution.
The company is also aware that equipping employees to respond with information and proposals is a
key element in serving customers and provides training to upgrade their abilities. Furthermore, selected
regional employees of overseas subsidiaries and offices receive group training in Japan to strengthen
the satisfaction of the company’s customers in Japan and overseas.
For more details related to customers, please refer to the following information.
ESG Data: Social Data (P. 187)

Responsible Export Practices
Each JFE operating company promotes international peace and security by working against the spreadof weapons of mass destruction and excess accumulation of conventional weapons. Specifically, thecompany carries out internal inspections to confirm the final destinations, customers and applicationsof its exported products, and then ensures that export procedures are carried out properly. In addition,
the Legal Affairs Department conducts internal briefings to disseminate knowledge of export-related
laws and regulations, such as the Foreign Exchange and Foreign Trade Act. Also, JFE provides
education on export security controls and related measures for the employees of Group companies
involved in trading.

Promotion of Research and Development
JFE SteelJFE Steel views automobiles, infrastructure materials and energy as the three key areas for researchand development. In each area, the company intends to accelerate the pace of introducing new
products and solutions. In regard to its manufacturing process, the company will work on developing
innovative manufacturing technologies such as eco-friendly raw material pre-processing. These
technological developments leverage data science and robotics to closely align with the needs ofcustomers and society at large.
JFE Steel plans to invest 110 billion yen into research and development over the span of three years,
starting in 2018.

JFE Engineering
JFE Engineering develops technology as a company that “creates and continues to care for thefoundation for life.” In regard to “create,” the company developed its own combustion technology for
waste-treatment and power-generation facilities. In the area of “creating” the foundation, the company
developed proprietary high-efficiency boilers that realize stable, clean incineration treatment andgenerate power at the highest level of efficiency in Japan. In the area of “care” JFE Engineeringcontinues to develop technologies that collect and analyze a range of data from the plants it operates inJapan as well as technologies that utilize AI to achieve optimal plant operation and automation.

JFE GROUP CSR REPORT 2020115

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
IndicesInternal Awards
The following technical and product developments were awarded in FY2019.
■ Internal Awards (FY2019)
Prize/Award

JFE SteelJFE
Engineering

ExcellenceAward, JFE Steel
President’sAwardsGrand Prize, JFE
Engineering
President’sAwards

Project

Recipient

Realization and deployment of
surface inspections based on thetwin-illumination and subtraction
technique

Cyber-Physical System
Research & Development Dept.,
Steel Research Laboratory andothersDevelopment of a topology
optimization technology for
reducing automobile weight

Forming Technology Research
Dept., Steel ResearchLaboratory and others

Establishment of a manufacturing
technology based on the endlessrolling process for high-quality,
hot-rolled high strength steel

Hot Rolling Dept.t, East Japan
Works (Chiba district) andothers

Early start of stable operations at
JSGT, and expansion in profit andproduction capacity throughconcerted improvement activities
by local staff

JFE Steel Galvanizing (Thailand)and others

Advancement of an operation
technique for incinerators basedon flame image processing

Research Center of Engineering
Innovation and Environmental
Solutions
Sector Innovation Center

For more on external awards, please refer to the following information.
External Awards (P. 201)

JFE GROUP CSR REPORT 2020

116

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesOccupational Health and Safety
Initiatives on Employee Health and Safety
Providing for the health and safety of employees is a basic requirement of companies, particularly
manufacturers, and is fundamental to the continued existence of any company. The JFE Group adheresto the philosophy of safety first, and, together with its group companies and business associates, works
to consistently maintain safe working environments and secure workplaces for all employees. Top
managers from each Group company conduct safety patrols and inspections to enhance occupationalsafety.
In addition, the Group exchanges ideas on safety and health with the labor union through its
Occupational Safety and Health Committee.
For lost-work injury data, please refer to the following information.
ESG Data: Social Data (P. 187)

Training Programs for Health and Safety
The JFE Group organizes seminars for newly appointed managers and supervisors to provide
information on the Industrial Safety and Health Act and risk assessment regulations and on formulating
work plans and policies for health and safety management. In the construction operations department,
we offer programs for local superintendents in charge of construction work (Overall Safety and HealthController ) centered on the Industrial Safety and Health Act as well as related regulations for
subcontractors and the Construction Business Act (577 participants in 2019). We also conduct new
employee training and position-specific training on mental health (198 participants in 2019).

Initiatives for Health and Safety by Business Segment

JFE SteelIn 2020, we are following two basic strategies: practicing autonomous safety activities while developing
communication between employees and business associates and taking action based on the Group’s
Health Declaration. Our slogan is “Nurture close communication across all employees from frontline
staff to management supervisors.” With this in mind, management supervisors make a point to visit
work sites every day, while workers are striving to handle their tasks with discipline. We are also
proactively applying IT, such as by introducing safety monitoring systems* for safety management.
To date, we have implemented safety activities based on the advice from Du Pont. We are going todevelop these activities into an occupational health and safety management system in accordance with
the ISO 45001 international standard as we seek to establish a corporate culture of safety that isvoluntary and independent.
* A system that provides managers with information about, for example, carbon monoxide
concentration and oxygen concentration in real time along with the location information of workers.

JFE GROUP CSR REPORT 2020117

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Governance Structure for Health and Safety

JFE Steel seeks to prevent and mitigate risks associated with disasters by assessing risks at theplanning stage for new facilities to evaluate and lower the risk level. We conduct risk assessments
during regular and non-regular repairs of facilities for the same reason. Additionally, we consistently
strive to lower the risk level to make each facility intrinsically safer for our workers.
We respond to industrial accidents by setting up a disaster investigation committee to determine thecause and offer recommendations for improvement to the department in charge of implementing
countermeasures. At the same time, we inform the relevant departments and labor union through the
Occupational Safety and Health Committee, while the department in charge implements and reports on
countermeasures, which is a mechanism designated by company-wide rules. In the event of a serious
disaster, a response is deployed across the company, and a standard progress report is submitted to theBoard of Directors until countermeasures are completed. This practice has also been standardized
across the entire company.
In addition, we immediately report accidents to the Japan Iron and Steel Federation (JISF) under theguidelines for reporting industrial accidents. We file an update once we have determined the cause anddecide on countermeasures. We also promptly submit a report on safety, disaster prevention andenvironmental issues to the Ministry of Economy, Trade and Industry, the Ministry of Health, Labor andWelfare, and the JISF.

JFE Engineering
JFE Engineering strives to eliminate accidents at its construction and operating sites and manufacturing
plants. By establishing “priority items to be shared across the company” to which all employees and all
members of associated companies adhere and promoting “identification of sources of danger and safetymeasures based on risk assessments” in accordance with each operation, the company is committed todisaster elimination. Additionally, driving efforts such as “physical and mental health promotion” and“creation of comfortable working environments” help to ensure the health of employees and raise thelevel of occupational health. In 2016, the company obtained OHSAS 18001 certification, an international
standard for occupational health and safety management systems, for its construction activities in Japanan overseas as well as its manufacturing operations at the Tsurumi and Tsu Works. Certification was
upgraded to ISO 45001 in 2019.

JFE GROUP CSR REPORT 2020

118

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Shoji
JFE Shoji is actively working on eliminating unsafe operations that could lead to severe accidents andtargeting zero severe accidents at its processing sites such as coil centers.
For each of its group companies, JFE Shoji assigns a safety manager, who is responsible for
improving safety at each company. Every safety manager is also responsible for activities such as (1)strengthening on-site patrols, (2) establishing safety monitors, (3) enforcing risk assessment andhazard prediction, and (4) identifying unsafe operations. Safety managers meet every other month toshare information. All workplace accidents that result in employees being absent from work must bereported to the top management from the president of each Group company as part of the JFE Shoji
Group-wide effort to address safety management. Annual safety awards are also presented. Throughthese initiatives, the company will raise the level of safety management within the whole group andcontinue to maintain safe working environments.

Employee Health
The JFE Group seeks to create safe, attractive environments where everyone can enjoy working andaggressively promotes the establishment of environments in which personnel with diverse backgrounds
can demonstrate their full potential. To that end, it has developed the JFE Group Health Declarationand collaborates with its health insurance union and industrial health staff to strengthen employee
health so that everyone can work with vigor.

JFE Group Health Declaration

１ JFE, recognizing that safety and health are fundamental for fulfilling its mission, creates
workplaces in which every employee can work with vigor.

2 JFE and its health insurance union work together to advance initiatives for maintaining andupgrading the physical and mental health of employees and their families.

3 JFE gives top priority to safety and health and to creating a health culture in which each
employee takes personal responsibility.

Physical Health Initiatives
 Ensure the implementation of regular physical examinations and strengthen cancer screenings.
 Prevent aggravation of lifestyle diseases by conducting metabolic syndrome checkups and offering
health guidance.
 Utilize the health insurance union’s health promotion app, PepUp, to educate employees on physicalexercise and other healthy habits.
 Promote non-smoking areas and maintain separate areas for smokers and non-smokers in buildings.
Provide guidance to help employees quit smoking through industrial physicians and public healthnurses.
JFE GROUP CSR REPORT 2020

119Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Metabolic Syndrome and Smoking Rates

Maintaining and Promoting the Health of Employees’ Families
The JFE Group works with the health insurance union to maintain and improve the health of employees
and their families by, for example, encouraging spouses to undergo health examinations. The rate ofhealth examinations for dependents (age 40 or older) has been steadily increasing over four years, to51.4% in FY2019, up 13.8 points from 37.6% in FY2014.
For employee health data, please refer to the following information.
ESG Data: Social Data (P. 187)

Mental Healthcare
The JFE Group conducts four basic initiatives to maintain the mental health of employees: “self-care”
for workers who strive to remain aware of stress and take preventive measures; “care by management
supervisors” who provide advice to subordinates; “care by industrial health staff” who support
employees, managers and supervisors; and “care by human resources outside workplaces,” including
specialist clinics and individuals.
JFE’s health insurance union also provides mental health counseling, including a 24-hour hotline for
employees and their families (spouse and dependents).

Initiatives on Health Issues
We operate a health management system for effectively managing the health of all employees,
including those on overseas assignments and business trips and those studying abroad.
We particularly seek to ensure that employees working abroad can maintain a healthy lifestyle,along with their accompanying family members, by conducting health checkups and vaccinations
before they move overseas, and we also provide information on preventing infectious diseases such as
HIV, tuberculosis and malaria during assignment briefings. We will continue to monitor andappropriately respond to global health issues (HIV, tuberculosis and malaria).

JFE GROUP CSR REPORT 2020

120

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE SteelDevelopment of the Health and Productivity Planning Management Promotion System,
Company-wide Goals and Follow-ups
To drive initiatives regarding maintaining and improving the health of employees and their families, JFE
Steel launched the Health and Productivity Management Promotion WG upon the establishment of its
Group Health Declaration in 2016, and it is monitoring the achievement of medium- to long-term goals
applicable to all affiliate companies.

■ JFE Steel’s Company-wide Targets (2020)
Targets

2020 Results (est.)

Rate of complete exams: 100%

77.0%

Rate of complete exams for dependents: 60%

48.2%

Rate of providing specific health guidance: atleast 60%

47.5%

Rate of obesity (BMI: 25% or higher) 25% or
less

29.5%

Maintaining andimproving healthParticipation in the Powering Up Health Care
program: at least 50%

40.3%

Promotion of nonsmoking

Smoking rates: 25% or less

33.8%

Thoroughimplementation ofphysical examinations
Preventive health
Measures■ Health and Productivity Planning Management Promotion System

JFE GROUP CSR REPORT 2020121

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Health and Productivity Management Promotion WG•
Members

Discussion Topics
Frequency

Each region, works,
main office•••

Industrial physicians and public health nurses
Manager of Labor Management Office, Labor
Management HR Department, Organizational
HR Department
Office of Safety and Health (health staff),
Safety and Health Department•

Health Insurance
Union

•
•
•

Evaluation of Health and Productivity Management (physical, mental andwork environment) (evaluation of indices and activities)
Company-wide activities
Reporting to the management team•February, May, August, November (once a quarter)•

Directing Manager, Manager of Health
Development Office

Active Exercise
JFE Steel business sites offer the Active Exercise program, which the West Japan Works designed tohelp people increase their physical strength and prevent injuries due to falling. The program’s
effectiveness in preventing occupational accidents and improving health has even attracted attention
outside the company, so it is being shared as a contribution to society.
JFE Engineering

Activities for Boosting Health Based on Health Checkup Data
JFE Engineering is pursuing initiatives for improving health focused on five domains, including sleep,smoking and obesity issues extracted from past health checkup data, along with cancer and mental
health.
■ Initiatives Based on Past Health Checkup Data
Year
Launched
2018

2019

Purpose

Initiatives

Strengthen cancer checkups

Stomach endoscopy during regular health checkups

Encourage a better
understanding of healthconditions to nurture awarenessand promote behavioral changes

Interviews with all new employees

Measures for preventing passive
smoking

Designate the 22nd of each month as a day formaking an effort to stop smoking

Promote self-care among all
employees

Selfcare seminars to practice methods for raisingconcentration through short naps and breathing
techniques

Address obesity

Recommend increased physical exercise bydisplaying the calories consumed by climbing stairs
and healthy strides
JFE GROUP CSR REPORT 2020122

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Response to the COVID-19 Pandemic
The JFE Group is addressing the COVID-19 pandemic through a variety of measures against infections
from the perspectives of securing the health and safety of employees as well as avoiding business
continuity risks. Each company practices thorough health management, including the wearing of masks,
washing and disinfecting hands and monitoring body temperature. We also encourage employees towork from home as much as possible and promote off-peak commuting based on flexible workstyles
without setting core work hours. We have installed partitions in offices and conference rooms, havebeen limiting the number of persons entering each room, and are also promoting online meetings inaddition to other measures for avoiding crowded conditions.
Nonetheless, the steelworks and waste incineration facilities of JFE Steel and JFE Engineering must
continue their operations even under a state of emergency, and the following measures are taken toprevent infection.
We minimize the number of participants attending meetings required for safety and operational
management by dividing them into groups while also taking care to avoid gaps in communication withregard to necessary information. When holding meetings with many people in one place, we seek toavoid crowding while providing adequate ventilation, limiting attendance to the absolutely necessary
number of personnel and maintaining distance between participants. We also adhere to industry
guidelines and conduct thorough daily checks of employees’ physical conditions.
In the lounge areas, we place vinyl sheet partitions at the center of the table to avoid that people doface each other while sitting. Each work site is striving to avoid physical contact by adopting measures
such as creating push-rods bearing employees’ names for pressing the buttons of drink servers.
Other measures include limiting the number of employees coming to work by dividing them into
three groups to stagger commuting and setting up temporary parking spaces for factory workers todisperse crowds in the parking lots.

Group meeting

On-site meeting

JFE GROUP CSR REPORT 2020123

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesLabor Standards (Recruit and Nurture Diverse Human
Resources)
JFE Group’s Basic Policy on Human Resource Management

１ Respect Human Rights and Facilitate Fair Management of Human Resources
The Group manages human resources fairly by respecting the human rights of all employees
and nurturing employees who embrace the Group’s corporate values and standards ofbusiness conduct.

2 Foster a Corporate Culture that Nurtures People and Promotes Satisfying Workplaces
The Group facilitates interactive communication among employees to cultivate a corporate
culture that nurtures human resources and creates safe, attractive environments where
everyone can enjoy working.

3 Diversify Human Resources
The Group ensures that diverse all people, including women, non-Japanese, the elderly andthe disabled, can demonstrate their full potential.

4 Recruit and Steadily Nurture Excellent Human Resources
To survive in an increasingly complicated and diversified global environment, the Group
steadily recruits diverse, high-quality skilled human resources, ensures that they receive theskills and knowledge necessary to continue strengthening the Group’s technologicalcapabilities, and nurtures their global capabilities.

Posters displayed at each workplace
JFE GROUP CSR REPORT 2020124

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Workstyle Reform
To ensure the sustainable development of the JFE Group, it is essential to fundamentally review pastcustoms and develop workstyles that enable each employee to be highly productive in creating newvalue with pride and satisfaction in their work. We intend to realize a working environment that enables
diverse personnel to fully demonstrate their abilities by pursuing flexible workstyles that cater to theneeds of each employee.

JFE Steel

Systems to Support Workstyle Reform
JFE Steel is accelerating its efforts to enhance productivity and respond to more diverse needs of
employees in their workstyles to help drive initiatives such as strengthening its manufacturing base andexpanding overseas. Specific initiatives have been implemented to improve employee awareness andcultivate an organizational climate in which everyone can maximize their abilities. These include
designating days in which employees are encouraged to leave work on time, conducting programs instandardizing the number of hours between work shifts* and work-at-home systems, and encouraging
employees to take paid leave.
JFE Steel also has a work-life-balance vacation program to support employees in taking vacations
for personal life events, self-enlightenment, or participation in volunteer activities.
* A program to set a certain length of time between clocking out and clocking in on the next day toprotect an employee’s private life and sleeping hours.

Employees arrange their own schedules and choose the day when they will leave on time automatically.

JFE GROUP CSR REPORT 2020

125

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Engineering

Flexible Workstyle
JFE Engineering is striving to nurture a corporate culture of coming to work early and leaving early bydesignating 8:00 am to 4:45 pm as its standard working hours and in principle prohibiting work after 8
pm. Other initiatives include planning vacation schedules through discussions between employees andtheir supervisors and designating days when employees are encouraged to take paid leave or leave
work on time. Telecommuting has been implemented to facilitate flexibility in workstyles. Now the
working environment encompasses working from home or choosing one of the dozen shared offices
around the country owned by a partner real-estate company.
JFE Engineering’s next goals are to enhance workstyle reform by taking advantage of the findings
from an employee satisfaction survey conducted in FY2018 and to realize a five-day workweek in its
construction operations department in order to overcome the difficulty in taking days off, which has
been a problem faced by the entire industry. The company is also encouraging employees to apply forthe annual paid break program, which allows them to take five consecutive days off once construction
work is completed.

JFE Shoji

Initiatives to Support Various Workstyles to Realize a Work-life-balance
As a measure to realize a work-life-balance, initiatives have been implemented to reduce work hours,
such as designating Wednesdays as the day to encourage everyone to leave on time, prohibit all work
after 10 pm, and also encourage taking paid leave.
To support more diverse workstyles, JFE Shoji changed its flexible working hour program in April
2016 by setting the core worktime between 11 am to 2 pm, and by introducing work-at-home systems
for employees pressed for time due to childrearing or nursing duties. The Company also implemented a
program called Challenge Days as a trial, in which employees can experience teleworking and sharedoffices, regardless of their time constraints.

Operational Reforms
JFE Steel

Promoting Operational Reforms that Leverage the Newest ICT
To reduce employee time spent on simple for repetitive tasks and free up more time for creative work,
JFE Steel implemented robotic process automation (RPA), a software to facilitate the automation ofhuman work done on terminal devices. In FY2019, RPA was deployed in over 200 types of operation,
releasing over 30 thousand hours to be spent on other productive work. In FY2020, we will identify
tasks to which RPA can be applied even amid the coronavirus pandemic.
JFE Steel is pushing ahead with a companywide project launched in FY2016 to upgrade missioncritical systems at each steelworks toward promoting operational reform as well.
The company will actively engage in operational reform by leveraging the newest ICT and use thetime generated by the operational reform to improve customer service.
JFE GROUP CSR REPORT 2020126

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Engineering

Smart-Work Project
JFE Engineering has been actively working on workstyle reforms since August 2014 and set up “Officeof Smart-Work Promotion” in April 2018 to further expand this effort.
By leveraging various IT tools and systems, and creating an unconventional working style in terms oftime, location and method, the company aims to achieve both work-life-balance and improved
productivity while maximizing overall output.

JFE Shoji

J-SLIM Activities
JFE Shoji will continue to drive its J-SLIM activities, which is an operational reform aimed at increasing
work efficiency and performance. We have been raising productivity by actively implementing cuttingedge IT tools, and the number of organizations using RPA has been rising since FY2018, when theimplementation project took off. It has provided numerous advantages such as significantly reducing
time spent on certain jobs through automation as well as expediting the provision of services. At the JSLIM presentation for 2019, 22 teams chosen from JFE Shoji and its group companies reported on the
improvements attained through activities addressing various issues. JFE Shoji will continue with its
effort to think outside of the box and flexibly address change to create a corporate culture thatencourages continuous innovation.

Invigorating Workplaces through Small Group Activities
JFE SteelJFE Steel has approximately 1,500 small groups that carry out J1 Activities* for quality and work
improvement. In addition, the JFE Family Result Reporting Conference, which includes participationfrom domestic and overseas Group companies, is held twice a year. Also, groups selected throughcompetition are given opportunities to go overseas as incentives.
* Designed to turn JFE into an excellent company and propel it to the number one position in its
industry (called JE1 Activities at JFE Engineering and J1 Activities at JFE Steel and JFE Shoji).

JFE Engineering
JFE Engineering has about 180 teams and 1,500 employees, including those of group companies
worldwide, involved in JE1 Activities. The results of these activities are showcased at a company-widecompetition held at the end of the fiscal year. Activities focused on topics such as quality, efficiency,
safety or costs contribute significantly to workplace vitality and corporate performance.

JFE GROUP CSR REPORT 2020127

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Shoji
Since 2012, JFE Shoji has been conducting J1 Activities in production divisions of its group companies inJapan as a means of improving their problem-solving skills in areas such as safety, quality, cost,
operations and delivery target. The company holds annual competitions in which about 20 teams fromthe east and west districts report their activity results and compete against each other. Awards are
given to the highest achieving teams. The company will continue to promote J1 Activities to improve
workplace vitality and performance and share survey results among Group companies.

Workforce Diversity
By designating workforce diversity as a key business objective and to address the ever-evolving
business environment, the JFE Group is promoting efforts to maximize the potential of employees
regardless of gender, nationality, creed or lifestyle.
Moreover, in the face of the recent trends of a declining birthrate and aging population as well as adecreasing labor force, diversity has become increasingly important for reliably securing excellent
human resources.

Company Policy Explained by the President
The president of JFE Holdings has endorsed the Declaration on Action that was introduced by a groupof male leaders in Japan who intend to create “A Society in which Women Shine” with the support of
the government’s Gender Equality Bureau Cabinet Office. He also announced additional measures tosupport the professional development of female personnel, thereby communicating both inside andoutside the company that women can play active roles at JFE.
For more on this, please refer to the following information.
Declaration of Action by a Group of Male Leaders Who Will Create a Society in Which Women Shine(http://www.gender.go.jp/policy/sokushin/male_leaders/pdf/declaration_body_en.pdf)

Supporting Women in Professional Development
The JFE Group is implementing a broad range of initiatives to support female employees, such asincreased hiring, enhanced childcare-support programs that significantly exceed statutory requirements,
and training and education.
In April 2019, the Group tripled the number of women in managerial positions from August 2014, farahead of the targeted year of 2020. We have already set a new target of raising the number of women in
managerial positions fivefold from August 2014 by year 2025, and we remain committed to appointing
women to managerial positions.
The JFE Group formulated an action plan to support women in their professional development incompliance with the Act on Promotion of Women’s Participation and Advancement in the Workplace(enforced in April 2016), based on which the company discloses relevant information. In recognition of
its efforts to encourage the empowerment of women, JFE Holdings was selected three times as aNadeshiko Brand* since FY2013.
* The Nadeshiko Brand represents a joint initiative by the Ministry of Economy, Trade and Industry and
the Tokyo Stock Exchange. It recognizes exemplary efforts by companies to encourage women to play
active roles and continue working long-term. A single company is selected for each business sector
represented in the TSE first section.
For more on this, please refer to the following information.
Action Plan based on the Act on Promotion of Women’s Participation and Advancement in the
Workplace (P. 134)
JFE GROUP CSR REPORT 2020

128

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Activities by Diversity Promotion Sections
To ensure the consistent promotion of diversity, each operating company has a Diversity Promotion
Section to organize educational activities, such as rank-based training and women’s exchange
meetings, and to share and implement best practices across the Group.

Key Initiatives at Each Operating Company
JFE SteelJFE Steel provides career support and management training for managers and other employees tocultivate a culture in which diverse human resources can demonstrate their full potential. About 400
women currently work on-site at the steelworks. The company also supports employees who are using
childcare and nursing care by providing workplace nurseries and holding nursing care seminars. In April
2019, workplace nurseries opened in all districts of our east and west steelworks. Moreover, thecompany has recently been actively hiring foreign nationals to secure human resources to meet thecompany’s globalization strategy. Various measures have been implemented to support comfortable
work environments for non-Japanese employees such as a training program for supervisors who will beworking with them.
JFE Engineering
JFE Engineering actively hires personnel with diverse characteristics and values, as well as people fromother business sectors. Around 70 people are hired each year as mid-career placements. The head
office regularly receives about 80 regional employees from overseas group companies and provides
training through daily operations to cultivate mutual understanding and transcend differences in culture
and customs. In addition, the company is striving to provide opportunities for management to improveawareness of diversity as well as providing leadership training and seminars for female employees.
JFE Shoji
JFE Shoji is expanding opportunities for female employees by promoting them to managerial positions
and dispatching them on overseas assignments. It is also supporting career development through theintroduction of a mentor program and enhanced training programs.
Management training in Japan is provided for employees hired overseas to promote global personnel
development and increased interaction.
The company is creating increasingly sound and flexible working environments by introducing a workat-home systems, rehiring former employees, expanding nursing care support, encouraging employees totake paid leaves, and other efforts.

Employment of People with Disabilities
The JFE Group has three special subsidiaries, JFE Apple East Corporation, JFE Apple West Corporationand Mie Data Craft Co., Ltd., to employ people with disabilities and create enjoyable workplaceenvironments for them.
For more on the employment of people with disabilities, please refer to the following data.
ESG Data: Social Data (P. 187)

JFE GROUP CSR REPORT 2020

129

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Reemploying Retirees
The JFE Group reemploys people after mandatory retirement at age 60, largely to ensure that the skills
and experience of veteran employees are handed down.
In the spirit of Japan’s Act on Stabilization of Employment of Elderly Persons, the Group has createda system for all employees to work until the age of 65.
As of April 2020, 904 elderly employees, about 4% of the total, are working at JFE Steel, JFE
Engineering, and JEF Shoji.
JFE SteelFor an enhanced work-life-balance, JFE Steel employees can choose full-time employment or shorter
workweeks after reaching their retirement age.
JFE Engineering
JFE Engineering created the Skilled Partner Program to rehire employees who want to continue working
after mandatory retirement at age 60.
JFE Shoji
For an enhanced work-life-balance, JFE Shoji employees who reach retirement age may choose from avariety of working arrangements, including full-time employment, shortened workweeks, and shortened
daily work hours.

Respect for Sexual Minorities (LGBTQ)The JFE Group is creating a workplace that does not discriminate on the basis of gender, sexual
orientation or gender identity by conducting internal human rights seminars and position-specificcurriculums. LGBTQ concerns have also been incorporated into the Group’s compliance guidebook,which is distributed to all employees and used as a common textbook during the annual Compliance
Month of October toward nurturing greater understanding. At JFE Steel, LGBTQ study groups are held
for human resources representatives in each district of its business locations.

Securing Diverse Human Resources

Sixth Medium-term Business Plan

: Around 1,040 people per year
(FY2018–FY2020)

FY2020 Results: 1,248 people (three operating companies,
excluding their subsidiaries)• Women in positions with prospects for promotion：12% (58 out of 475)

Of the above, those in white-collar positions：24% (37 out of 157)

• Mid-career and year-round recruits：24% (304 out of 1,248)

Of the above, recruits in positions with prospects for promotion：25% (121 out of 475)

Of the above, recruits in on-site positions at steelworks：24% (183 out of 758)

To ensure sustainable growth, the JFE Group steadfastly recruits from a diverse pool of applicants andactively hires women, foreign nationals and midcareer personnel, and recruits year-round.
JFE GROUP CSR REPORT 2020130

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Recruitment Results (Three Operating Companies, Excluding their Subsidiaries) in FY2020
Category

Career-track Positions

On-site andClericalPositions

Total

Total

White-collar

Technical

Male

120

297

417

703

1,120

Female

37

21

58

70

128

Total

157

318

475

773

1,248

Ratio ofwomen (%)

23.6

6.6

12.2

9.1

10.3

■ Target Ratios for Female Recruits
Position

JFE Steel

JFE Engineering
JFE Shoji

TargetCareer-track white-collar positions

At least 35%

Career-track technical positions

At least 10%

On-site positions for regular recruitment

At least 10%

Career-track position

At least 20%

Production/construction positions(technical)

At least 5%

Career-track position

At least 25%

For more on employees, please refer to the following data.
ESG Data: Social Data (P. 187)

Human Resource Development
The JFE Group collectively carries out human resource development with an emphasis on nurturing thecapacities of each employee and cultivating global human resources to support the expansion of ouroverseas business.

JFE SteelUtilizing Skill Data for Training Programs
The company utilizes an evaluation system at manufacturing sites to quantitatively analyze the skill
level of each employee. By focusing on infrequent or irregular tasks involving relatively high skill levels,
the training program is linked organically to accumulated skill data, backed by practical guidance fromfull-time instructors (technical experts) who possess advanced skills.

JFE GROUP CSR REPORT 2020131

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Engineering

Training Programs to Support Independent Learning
To enhance the knowledge of underlying technologies that represent a technological foundation for anengineering enterprise, the Company’s leading expert lectures over 30 different courses on basic
technology for younger employees and mid-career hires.
A web-based learning curriculum launched in FY2018 offers employees opportunities to acquirebusiness skills that cater to each job responsibility, including accounting and marketing.
JFE ShojiTraining and Measures to Maximize Employee Potential
In order to unlock the potential of employees with diverse backgrounds and exploit their maximum
abilities, JFE Shoji offers female employees a variety of training opportunities, including next-generation
female leader training for increasing their active participation in business. JFE Shoji also invites regional
employees hired at overseas offices that require a high level of competency to Japan for training in order
to increase their skills and motivation, and the company offers training for newly hired midcareer
employees as well. In addition, we provide training aimed at developing the basic skills required of
trading company personnel, such as those for negotiation, finance and strategic thinking, to those above
the level of young, career-track employees.

Developing Global Personnel
In addition to hiring and developing non-Japanese for career-track positions in Japan and hiring more
local personnel overseas, the JFE Group is enhancing programs for Japanese employees to gain
overseas study and training. The company is also developing younger employees through practicalexperience by dispatching them on overseas assignments.
■ Global Personnel Development Programs
JFE SteelJFE
Engineering

JFE Shoji

Study abroad

〇

〇

〇

Short-term overseas language training

〇

―

〇

Overseas assignments for younger employees

〇

〇

〇

Dispatching engineers to international
conferences

〇

―

―

Training for regional employees of overseas
offices〇〇〇On-the-job training in Japan for regional
employees of overseas offices

―

〇

―

Internship for international students

〇

〇

―

JFE GROUP CSR REPORT 2020132

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesDeveloping Dynamic Working Environments
The JFE Group is developing dynamic working environments through sincere discussions with labor
unions and conducting employee satisfaction surveys.
We also seek to reflect the results of the corporate ethics survey, conducted every three years, tocreate employee-friendly working environments.
JFE Steel
Recognizing that labor-management cooperation is essential for the company to fully tackle its
business challenges, JFE Steel has established a strong relationship with its labor union based onunderstanding and trust. The company convenes its Labor-Management Business Discussion
Committee four times a year to bring the president and other executives together with labor
representatives for the purpose of exchanging ideas on business challenges. The two sides also shareviews on working conditions and workplaces and hold joint consultations whenever the labor system isrevised.
JFE Engineering
JFE Engineering strives to ensure sound labor-management relations. In addition to Central Labormanagement Committees, which are regularly convened for the company’s president and otherexecutives to share views with representatives of its labor union, a labor-management committee on
work-life-balance helps to maintain friendly working environments.

JFE Shoji
JFE Shoji management and labor regularly exchange opinions and share information. The company
president and other executives exchange views with representatives of its labor union during
semiannual Management Committee meetings.

Promoting Satisfying Work Environments
In addition to meeting legal requirements for the minimum wage, upper limits for overtime, and othermandates, the JFE Group establishes challenging and satisfying work environments by providing our
employees with one of the top levels of employment conditions in the industry as well as performancebased bonuses linked to company profits.
Furthermore, the Group offers generous welfare benefits, including dormitories and company
housing in order to provide a stable environment for our employees and encourage them to remain withthe company for many years.

JFE GROUP CSR REPORT 2020133

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Action Plan based on the Act on Promotion of WomenʼsParticipation and Advancement in the Workplace
Formulation of an Action plan for Promoting Women’s Professional Development
The Act on Promotion of Women’s Participation and Advancement in the Workplace went into effect on
April 1, 2016.
The JFE Group has designated the promotion of workforce diversity as a key management strategy
for maximizing the potential of every employee and has been actively hiring and supporting theadvancement of female employees.
We have recently formulated an action plan in accordance with the Act on Promotion of Women’sParticipation and Advancement in the Workplace to establish a work environment that encourages
female employees to advance in their careers as managers and for male employees to participate
proactively in childcare.

Action Plan Period
Period of five years starting on April 1, 2016 and ending on March 31, 2021

Target of the Action Plan
The JFE Group’s common goal regarding women’s advancement is to triple the number of female
officers and managers in 2020 from 2014.
Please review the following documents for further details, including the specific targets andinitiatives of each operation company.

Action Plan for Each Operation Company
JFE Steel (Japanese only) (https://www.jfe-holdings.co.jp/csr/pdf/female_plan_st.pdf)
JFE Engineering (Japanese only) (https://www.jfe-holdings.co.jp/csr/pdf/female_plan_eng.pdf)
JFE Shoji Corporation (Japanese only) (https://www.jfe-holdings.co.jp/csr/pdf/female_plan_shoji.pdf)

JFE GROUP CSR REPORT 2020134

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Human Rights (Respect for Human Rights)
The JFE Group endorses and abides by the Universal Declaration of Human Rights, the International
Covenant on Human Rights and other international conventions as well as the International Labour
Organization’s Declaration on Fundamental Principles and Rights at Work.
The JFE Group views respect for human rights as both a corporate social responsibility and afoundation of its business. Our determination to not engage in discrimination in our business activities
is clearly expressed in our Standards of Business Conduct, which we have upheld throughout ouractions. Recent Group-wide initiatives, based on the United Nations Guiding Principles on Businessand Human Rights, include establishing the JFE Group Human Rights Basic Policy in FY2018 andorganizing seminars on business and human rights in FY2019, by external experts who spoke about
international trends.

Human Rights Basic Policy

１ Respect for basic human rights
We recognize the diverse values of individuals in all aspects of corporate activities andrespect and defend all human rights in accordance with international norms.

2

Abolition of discrimination
We respect each person as an individual in corporate activities and shall not discriminate inany way with regard to race, nationality, ethnicity, creed, religion, social status, family origin,age, gender, sexual orientation, gender identity, or presence or absence of any disability.

3 Prohibition of harassment
We shall not engage in harassment with respect to gender, position or in any other way, orby any behavior that demeans degrades the dignity of others or causes mental discomfort.

4 Respect for fundamental labor rights
We value healthy labor-management relations and work to solve problems through constantdialogue between management and employees in good faith and in accordance withinternational norms, taking into account the laws and labor practices of each country. In
addition, we always strive to upgrade worker safety and work environments that are
rewarding for all employees.

5

Prohibition of child labor and forced labor
We shall not engage in any way in child labor or forced labor in any country or region.

6

Seek the cooperation to all stakeholders
Respecting and defending human rights is not only mandatory of all officers and employeesof the JFE Group, we also seek the cooperation of our supply chain members and all otherstakeholders to observe these principles and practices.

JFE GROUP CSR REPORT 2020

135

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Promoting Human Rights
In order to steadily work on human rights initiatives, we established the JFE Group Human Rights
Promotion Council, chaired by the executive officer in charge of general administration, under the JFEGroup Compliance Committee, chaired by the president of JFE Holdings. This framework allows us todefine Group-wide policies and share information with departments responsible for human rights
issues that have been set up at each operating company.
In addressing human rights risks, we emphasize communicating with stakeholders through suchinitiatives as setting up a Corporate Ethics Hotline at each operating company and dedicatedconsultation desks on harassment issues at major offices. The Board of Directors receives regular
reports on the operational status of these help desks and cases of harassment as well as other humanrights violations.
■ Governance Structure for Human Rights Awareness Promotion

Human Rights Promoting Activities
We conduct human rights training courses, offer guaranteed employment opportunities, promote fairhuman-resource management, and work to prevent workplace harassment. Our training courses
encourage employees to develop a thorough understanding of the JFE Group’s Human Rights Basic
Policy and the respect for human rights expected of a company in the international community. To thisend, we continuously monitor and following up on seminars by designating 100% attendance as a KPI.
We seek to prevent sexual harassment, the abuse of power and other forms of harassment byaddressing these issues in company regulations, displaying posters in workplaces and organizing
training for each position, individual offices and executives. In 2019, we invited an outside attorney tohold a seminar for about 150 hotline staff within the JFE Group. We regularly organize such training
sessions for hotline and consultation desk personnel.
Furthermore, we actively support and take part in initiatives undertaken by public organizations andgroups promoting human rights as well as groups in which private enterprises participate, such as theIndustrial Federation for Human Rights, Tokyo and the Corporate Federation for Dowa and Human
Rights Issue, Osaka. By attending seminars and workshops of such organizations and groups, we havebecome increasingly aware of human rights trends and challenges as well as issues specific toJapanese business. In turn we apply this knowledge in JFE human-rights awareness training programs
and related initiatives.

Human Rights Initiatives for the Supply Chain
Tantalum, tin, tungsten and gold produced in certain regions, such as the Democratic Republic of theCongo, are defined as conflict minerals under the U.S. Wall Street Reform and Consumer Protection Act.
There is concern that such minerals provide a funding source for militias causing human rights
violations and environmental destruction.

JFE GROUP CSR REPORT 2020136

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
JFE Steel recognizes that human rights violations and environmental issues pose actual businessrisks in procuring raw materials. We therefore established the Raw Material Purchasing Policy todevelop and operate a sustainable procurement system for sourcing raw materials and practicepurchasing with due respect for human rights, regulatory compliance and environmental protection. We
also established Business Conduct Guidelines, asking suppliers to comply with this initiative, and seek
to publicize the guidelines across the supply chain via our website.
With regard to conflict minerals, we have clearly stated our policy to avoid purchasing them in our
Business Conduct Guidelines. We comply with Japanese and overseas regulations governing the
responsible procurement of minerals as well as international rules and investigate and confirm with
suppliers that they are not selling conflict minerals.
For more on the procurement of raw materials, please refer to the following information.
Business Conduct Guidelines of the Raw Materials Purchasing Policy(https://www.jfe-steel.co.jp/en/company/purchase_policy.html)

Respecting the Rights of Workers
The JFE Group adheres to the laws and regulations of various countries as well as collective
agreements. It also respects the rights to freedom of association as well as their right to collective
bargaining.
Upper management, including the president and the representative of the union, meets regularly to
discuss matters such as management issues, work life-balance, working environments, and working
conditions. By conducting earnest labor-management consultations, we strive to create a vigorous
workplace while working to maintain healthy and sound labor-management relations.
In addition to meeting legal requirements for the minimum wage, upper limits for overtime, and othermandates, the JFE Group establishes challenging and satisfying work environments by providing our
employees with one of the top levels of employment conditions in the industry as well as performancebased bonuses linked to company profits.
We regularly review the wage situation in each region and business sector and engage in honest
discussions with the labor union to ensure a fair return to our employees while also paying due
consideration to management and business performance.

Respect for Freedom of Expression
The JFE Group upholds basic human rights in its Human Rights Basic Policy and is committed torespecting and protecting the human rights of each individual throughout its corporate activities. We
pay due care to prevent violations of the freedom of expression, as recognized by the International
Covenant on Human Rights and other international conventions, and to fully protect the right to privacy.

Respect for Children’s Rights
The JFE Group supports the Convention on the Rights of the Child and Children’s Rights and Business
Principles and will seek to eliminate child labor and respect every child’s right to survival , right todevelopment, right to protection and the right to participation, the four pillars of the Convention on the
Rights of the Child.
The JFE Group Human Rights Basic Policy upholds recognizing the diverse values held by eachindividual in all aspects of corporate activity as well as respecting and protecting the human rights ofeach person in compliance with international conventions. It also explicitly prohibits child labor andforced labor. To promote concrete initiatives, the JFE Group has focused on nurturing the next
generation as a key area of its public service and is engaged in activities that support the sounddevelopment of younger generations.
JFE GROUP CSR REPORT 2020137

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Community
JFE Standards of Business Conduct

3 Work with communities
Actively contribute to host communities as a good corporate citizen by emphasizing harmony
and cooperation.

Local Activities
We are engaged in corporate activities across the globe. Continuing to do business requires that weforge relationships of trust with local communities and realize sustainable growth together bycontributing to the development of each region in which we operate as well as by pursuing development
at manufacturing sites where our steelworks are located. In addition to consistently taking action toensure safety and reduce the environmental impact of our corporate operations, we also conduct
initiatives that serve the public with a focus on protecting the environment, nurturing the next
generation, promoting sports and culture, and revitalizing regional communities.
The operation of our steelworks involves massive production facilities and significantly impact theregion’s employment and economy as well as environmental air and water quality. Our steel businessseeks to revitalize local communities as an important means for deepening understanding of the JFEGroup among local residents and mutually promoting regional development.
In addition, we provide paid leave programs that can be used to promote volunteer work to
encourage the active participation of employees.

Opening Manufacturing Sites to the Public
Every year, the JFE Group opens its manufacturing facilities to residents in local host communities fordemonstrations, tours and other events.
■ On-site Events in FY2019
Location

JFE SteelJFE
Engineering

Event

Date

East Japan Works,
KeihinKeihin Community Festival

East Japan Works,
Chiba

JFE Chiba Festival

West Japan Works,
Fukuyama

Attendees

May 2646,000

October 27

30,000JFE West Japan Festival in
Fukuyama

May 1285,000West Japan Works,
Kurashiki

JFE West Japan Festival in
Kurashiki

November 3

80,000Chita Works

Handa Community Industrial
Festival

November 9

20,000Tsu Works

Autumn Festival 2019

October 19

4,000

JFE GROUP CSR REPORT 2020138

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Keihin Community Festival
In addition, on-site recreational facilities are made available for community sports such as soccer,
baseball, volleyball and basketball as well as other events sponsored by Group companies. Coachingsessions are offered by company baseball and track teams, which compete in Japan’s top-level
corporate leagues. Such activities promote sports and health as well as stronger relationships with hostcommunities.
JFE SteelTour of Steelworks
Every year, JFE Steel invites over 100,000 guests, mostly elementary and junior high school students
from host communities, to tour steel production sites at each steelworks, in conjunction with festivals
and other events.

Education at Elementary Schools
JFE Steel conducts plant tours for students at nearby elementary schools. In addition, company
employees visit schools to give lectures on iron and steelmaking processes, the features of steelworks,
environmental initiatives and other topics to deepen understanding of the steel industry. These lectures
have been given to over 195 classes since its start in FY2012. In FY2017, the company conducted thefirst class at a school for hearing impaired children.

Visiting lecturer at Samugawa Elementary School in Chiba City
JFE GROUP CSR REPORT 2020139

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Support for External Organizations
Contributing to the realization of a sustainable society is a key management concern for the JFE Group,
which actively seeks to address issues in collaboration with external groups and NGOs in pursuingsolutions for the 17 SDGs.

UN World Food Programme
The JFE Group seeks to resolve the global hunger issue by supporting the cause and activities of theJapan Association for the World Food Programme*.
* An NPO-accredited supporter of the UN World Food Programme (WFP), which works to eliminate
hungerSupporting Training for Foreign Medical Professionals
The JFE Group supports the Japanese Council for Medical Training, spearheaded by the Toranomon
Hospital in Tokyo. The council offers a training program in which doctors from developing countries,
primarily in Southeast Asia, are invited to study in Japan to foster stronger relationships between thosenations and Japan. The program also contributes to resolving health issues in local communities byenhancing the medical standards of those countries.

Japanese Foundation for Cancer Research
Since its establishment in 1908, the Japanese Foundation for Cancer Research has upheld its basic
philosophy of aiming to improve the well-being of people everywhere by achieving better cancer
control. The JFE Group supports this foundation, which has played a leading role in research andtreatment as well as human resource development in Japan.

Fund to Support Children’s Future
The JFE Group endorses the Japanese government’s national campaign for creating a society in which
every child can grow with dreams and hopes. The Group supports the Fund to Support Children’s
Future, which provides assistance to NPOs and other groups engaged in activities to eliminate poverty
throughout Japan.

JFE GROUP CSR REPORT 2020

140

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Support for Youth Development
Japanese Language Speech Contest
The JFE Group supports the All-China Japanese Speech Contest for university students in China as away to promote stronger international exchange. The contest has been held since 2006 to further
Japan-China relations through language and communication, and JFE has provided support from its
launch. Through this activity, the JFE Group contributes to the development of Japanese language
education in China and the promotion of friendly exchanges between the two countries.

Contest to help build the friendship between Japan and China (awards ceremony in FY2019)
JFE SteelHigh School Science and Engineering Contest
The Japan Science & Engineering Challenge is a national science-paper contest for high school andtechnical college students. Under the sponsorship of the Asahi Shimbun Company and TV Asahi
Corporation, the contest has been supported by JFE Steel since 2006 to nurture future scientists andengineers.

From left: 2019 JFE Steel Award recipients Fukushi Ogawa, Yuki Mimuro and Serena Aihara of Shizuoka
Kita High School, affiliated with the Shizuoka Institute of Science and Technology
JFE GROUP CSR REPORT 2020141

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Career Education for Students
JFE Steel and JFE Engineering provide plant tours for female junior high school, high school anduniversity students to encourage them to pursue careers in science and technology.
Since 2006, JFE Steel has participated in the Keizai Koho Center’s “Business Training for Japanese
School Teachers.” Teachers from primary, junior high and high schools learn about business operations,human resource development, safety and environment-protectionrelated initiatives, among other topics, with the intention of sharing that knowledge with theirstudents and leveraging it for better school management. In addition, some facilities invite local juniorhigh students and host work-experience sessions.
As part of career education for high school and junior high school students, Kawasho Foods
Corporation, a member of the JFE Shoji group, cooperates with the School Support Center, a specified
Nonprofit Corporation, to invite students for training. The participants learn how society is supported by
specific kinds of work as well as the products and services related to such work.

Business training for schoolteachers

FY2019 Internships
The JFE Group annually hosts many trainees and interns from overseas to help them gain practicalexperience at plants as well as design and construction sites. They also participate in group work.
Since FY2017, the JFE Shoji Group has been providing opportunities for children with special needs
to study outside the school. Students gain workplace experiences such as serving coffee or cleaning
offices while also learning about distribution by introducing and selling sweets and coffee shop goods
that are produced at their school. The Group received 188 students in FY2019.
■ Number of Interns Accepted by Each Operating Company (FY2019)
JFE Steel
460 (desk work: 191; technical: 269)

JFE Engineering
Approx. 910

JFE ShojiApprox. 640

JFE GROUP CSR REPORT 2020142

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Shoji

Supporting Elementary Schools in Ghana and Nigeria
Since 2011, the JFE Shoji Group has continuously supported elementary schools in the West Africancountries of Ghana and Nigeria as part of its CSR activities. To address deficiencies in the local
educational environment, it has also focused on donating goods related to education and food, which
are essential for the sound development of children and greatly appreciated by the schools andgovernments in the countries. Donations in FY2019 included 700 sets of desks and chairs, 17,000
notebooks, and 12,500 cans of food. The ceremony was attended by many children and local educators.
The JFE Shoji Group is committed to continuing this project into the future that symbolizes theGroup’s commitment.

Naosuke Oda, president of JFE Shoji, with students at an elementary school in Ghana

Supporting School Meals in Developing Countries
JFE Shoji participates in an activity led by TABLE FOR TWO International, a specified Nonprofit
Organization, in which a donation equivalent to one school meal for children in developing countries ismade for every designated meal purchased by employees in the company’s cafeteria.

JFE 21st Century Foundation
The JFE 21st Century Foundation was founded in 1990 through a donation from the JFE Group (theformer Kawasaki Steel) to operate as a public-service corporation that contributes to society. It
engages in various public services, such as supporting research at universities and culturaldevelopment.
For more on the JFE 21st Century Foundation, please refer to the following information.
JFE 21st Century Foundation (http://www.jfe-21st-cf.or.jp/eng/)
ESG Data: Social Data (P. 187)

JFE GROUP CSR REPORT 2020

143

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Support for Technology Research
The foundation has been highly acclaimed by many universities for its support of technology research
since FY1991.
In FY2019, it fielded 195 grant requests and provided a total of 50 million yen in the form of grants
valued at 2 million yen each for 12 projects involving iron and steel technologies and 13 projects related
to environmental technologies, including those designed to prevent global warming.

Support for Asian History Studies
The foundation began awarding grants in support of Asian history studies at Japanese universities in
FY2005. In FY2019, 69 applications were received and 10 grants worth 1.5 million yen each wereawarded, bringing the total to 15 million yen.

Support Regional Activities
The foundation financially sponsors community cultural activities including music, art, traditional events,
community revitalization, community activities and the conservation of cultural property.
In FY2019, it sponsored events in regions across Japan where the Group operates its steel business,
including Chiba, Kawasaki, Handa, Kurashiki and Fukuyama cities.

Supporting the Japan Overseas Educational Services Writing Contest and Anthology Donation
The Japan Overseas Educational Services organizes contests in the areas of essays, poems, tanka andhaiku for Japanese students attending elementary and middle schools overseas. The JFE Group has
been cosponsoring the contest by offering JFE 21st Century Foundation prizes since FY1991. The
foundation also donated 2,400 copies of “Chikyu ni Manabu” (Learn from the Earth), a collection of thewinning entries again in FY2019, to 671 elementary and middle schools and 73 public libraries in theregions where the Group operates its steel business.

List of Social-contribution Activities
Local Communities and Society
Supported World Food Programme
Supported Japanese Foundation for Cancer Research
Gave plant tours (https://www.jfe-steel.co.jp/en/company/csr.html#anc01-01)
Held festivals and events (https://www.jfe-steel.co.jp/en/company/csr.html#anc01-02)
Donated to Japan National Council of Social Welfare(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-03)

Lectured at elementary schools (https://www.jfe-steel.co.jp/en/company/csr.html#anc01-04)
Joined local cleanup activities (https://www.jfe-steel.co.jp/en/company/csr.html#anc01-05)
Conducted disaster response and prevention activities with local governments(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-06)

Implemented and promoted Active Exercise®

(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-07)

Launched on-site daycare centers open to local residents(https://www.jfe-steel.co.jp/en/company/csr.html#anc01-08)

JFE GROUP CSR REPORT 2020

144

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Cooperated with traditional events (https://www.jfe-steel.co.jp/en/company/csr.html#anc01-09)
Joined Nishinomiya tourism event (https://www.jfe-steel.co.jp/en/company/csr.html#anc01-10)
Held Manufacturing Class for children (https://www.jfe-steel.co.jp/en/company/csr.html#anc01-11)
Sponsored children’s eco activities under World Food Programme
Supported local festivals
Organized public viewing of "Dragonfly Street" and Station Square
Joined Where Do Dragonflies Fly Forum
Supported Tsurumi Line stamp rally
Volunteered for Kasumigaura Marathon
Volunteered for disaster reconstruction
Organized in-house reconstruction-support fairs

Nurturing the Next Generation
Supported Chinese students’ Japanese speech contest
Supported Japanese Council for Medical Training
Supported Welfare and Medical Service Agency’s Children’s Future Support Fund
Supported technician education in Southeast Asia
(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-01)

Organized internships (https://www.jfe-steel.co.jp/en/company/csr.html#anc03-02)
Supported Japan Science & Engineering Challenge(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-03)

Provided work experience (https://www.jfe-steel.co.jp/en/company/csr.html#anc03-04)
Supported career education (https://www.jfe-steel.co.jp/en/company/csr.html#anc03-05)
Accepted teachers for private-sector training (https://www.jfe-steel.co.jp/en/company/csr.html#anc03-06)
Cooperated with School Support Center (https://www.jfe-steel.co.jp/en/company/csr.html#anc03-08)
Helped women chose careers in science or engineering(https://www.jfe-steel.co.jp/en/company/csr.html#anc03-07)

Certified as company supporting child rearing (Kanagawa Prefecture and Nagoya City)
Certified as Work-Life Balance Business (Kanagawa Prefecture)
Accepted foreign technical interns (welding training)
Supported elementary schools in Ghana and Nigeria
Supported off-campus training by special-needs schools

JFE GROUP CSR REPORT 2020

145

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Protection
Organized firefly larvae release and viewing party (https://www.jfe-steel.co.jp/en/company/csr.html#anc04-01)
Held environmental exhibitions (https://www.jfe-steel.co.jp/en/company/csr.html#anc04-02)
Voluntarily fertilized cherry trees (https://www.jfe-steel.co.jp/en/company/csr.html#anc04-03)
Eco-purposed steel slag (https://www.jfe-steel.co.jp/en/company/csr.html#anc04-04)
Certifed for outstanding 3R-activities (8th straight year) by Yokohama
Donated PET bottle caps
Cooperated with nonprofit Green Bird in volunteer garbage collection

Sports and Cultural Promotion
Held local sporting events (https://www.jfe-steel.co.jp/en/company/csr.html#anc02-01)
Baseball and racing clubs held instructional classes(https://www.jfe-steel.co.jp/en/company/csr.html#anc02-02)

Sponsored Chochikun Go Cup (https://www.jfe-steel.co.jp/en/company/csr.html#anc02-03)
Promoted parasports (https://www.jfe-steel.co.jp/en/company/csr.html#anc02-04)
Keihin Symphonic Band gave performances (https://www.jfe-steel.co.jp/en/company/csr.html#anc02-05)

JFE 21st Century Foundation
The JFE 21st Century Foundation was established in 1990 with the support of JFE, including the former
Kawasaki Steel. As a public-interest foundation it undertakes various civic-minded services, including
providing financial aid for university research and promoting local culture.
JFE 21st Century Foundation (http://www.jfe-21st-cf.or.jp/eng/)
Issued technical research grants
Issued grants for Asian historical researchDonated materials and steel publications
Sponsored cultural activities in communities hosting steel facilities
Held Overseas Literary Contest and donated literary works

JFE GROUP CSR REPORT 2020146

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Shareholders and Investors
JFE Standards of Business Conduct (Excerpt)

2 Be open to society
Disclose corporate information actively and engage in constructive dialogues with diverse
stakeholders to enhance our corporate value.

Returns to Shareholders
The JFE Group positions returns on shareholder investment as one of its top priorities. Profits arebasically returned in the form of dividends. The Group’s basic policy under its Sixth Medium-term
Business Plan is to achieve a payout ratio of about 30%.

Proactive Information Disclosure
The JFE Group strives for fair disclosure based on established internal policy. The Group actively
communicates with investors by holding meetings when announcing financial results, medium-termbusiness plans or other important information. The executive directors explain the announced results
and answers questions at investor meetings, and they also hold small-group briefing sessions andconducts individual interviews with institutional investors and securities analysts. In addition, they
regularly visit investors in Japan and overseas, including institutional investors in North America andEurope.
For individual investors, briefings are held at the branch offices of securities firms around Japan.
The Group also distributes e-mails regarding IR information. Important press releases and Notices of
the Ordinary General Meeting of Shareholders are provided in English for overseas investors.
In addition, JFE Holdings is committed to fair disclosure of information under its disclosure policy.
■ Major IR Activities (FY2019)
Activity

Participants

Investor meetings

Approx. 500

Individual interviews with institutional inverstors and securities analysts

Approx. 400

Briefings for private investors at securities firms

Approx. 800 in 11 briefings

For more on this, please refer to the following information.
Disclosure policy (https://www.jfe-holdings.co.jp/en/investor/management/disclosure-policy/index.html)
Investor information: Japanese version (https://www.jfe-holdings.co.jp/investor)
Investor information: English version (https://www.jfe-holdings.co.jp/en/investor)

JFE GROUP CSR REPORT 2020147

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesEnhancing Communication with Shareholders
JFE Holdings created its Investor Relations and Corporate Communications Department in April 2015
to facilitate more interactive communication with diverse stakeholders. The collection anddissemination of integrated information is being enhanced to provide management with more useful
information for constructive dialogues with shareholders, including individual investors as well as
domestic and foreign institutional investors.
General meetings of shareholders are opportunities for dialogue with shareholders, so JFE sends
invitations at the earliest possible date to maximize attendance and avoid overlapping with theshareholder meetings of other companies. The company has been posting an invitation on its website
at the earliest possible date while allowing online voting for shareholders who are unable to attend.
For data related to plant tours and company briefing sessions for shareholders, please refer to thefollowing information.
ESG Data: Social Data (P. 187)

JFE GROUP CSR REPORT 2020

148

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Corporate Governance
Basic Policy
With the steel business, engineering business and trading business at its core, the JFE Group develops
a broad range of businesses in a wide range of areas together with many group companies andpartners. Establishing a proper governance system is essential towards improving independence andraising efficiency in each operating company, along with the optimal management of risks, which
include those related to the environment, safety and disaster prevention in the Group. It is also
necessary for the sustainable growth of the Group and the medium-to long-term improvement of its
corporate value.
We have also established the JFE Holdings, Inc. Basic Policy on Corporate Governance to express
concretely the JFE Group’s Corporate Vision of pursuing best practices in corporate governance andachieving further development in this area.
JFE Holdings, Inc. Basic Policy on Corporate Governance(https://www.jfe-holdings.co.jp/en/company/info/pdf/basic-policy.pdf)

Corporate Governance Report(https://www.jfe-holdings.co.jp/en/company/info/pdf/corporate-governance.pdf)

Part of the governance data is also disclosed under “Governance Data (P. 192) ” in the ESG Data.

JFE GROUP CSR REPORT 2020

149

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Corporate Governance System
Group Governance System
The JFE Group comprises a holding company and three operating companies JFE Steel, JFE Engineeringand JFE Shoji.
JFE Holdings, a pure holding company at the core of the Group’s integrated governance system,
guides Group-wide strategy, risk management and public accountability.
Each operating company has developed its own system suited to its respective industry, ensuring
the best course of action for competitiveness and profitability.
ESG Data: Corporate Governance System (P. 192)

Major Topics Discussed at the FY2019 Board of Directors Meeting M&A projects (e.g., acquisition of Cogent Power Inc. in Canada, acquisition of Mitsui E&S Plant
Engineering Inc.)
 Investments in overseas business (e.g., specialty bar steel joint venture in China) Large-scale capital expenditures (e.g., revamping of the No. 4 blast furnace at West Japan
Works(Kurashiki)) JFE Steel’s structural reform and long-term strategy
 ESG initiatives (e.g., assessment and review of KPIs for material CSR issues)

Governance System
JFE Holdings and each operating company have their respective Audit & Supervisory Board Members.
The companies are crosschecked by the Directors, who supervise operational execution, and the Audit& Supervisory Board members, who conduct audits. Also, a Corporate Officer system separates
decision making and execution to clarify authority and responsibility, as well as to accelerate execution.
JFE Holdings’ Board of Directors is responsible for maintaining and enhancing management efficiency
and passing resolutions as legally required, laying down key management policies and strategies andsupervising operational execution. The Audit & Supervisory Board oversees management for the
purpose of strengthening its soundness.

JFE GROUP CSR REPORT 2020

150

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Major Initiatives to Strengthen the Governance System

Independent Outside Directors
We elect Independent Outside directors with the aim of ensuring one-third or more of the Directors are
Independent Outside Directors. Independent Outside Directors will be elected from persons who areappropriate to bear the responsibility of strengthening governance such as those who possess
abundant experience as management in global enterprises or experts who possess profound knowledge
and satisfy our independence standards. Currently, of the eight Directors, three are Independent
Outside Directors.

Independent Outside Audit & Supervisory Board Members
More than half of the Audit & Supervisory Board Members are from outside. Independent Outside Audit& Supervisory Board Members will be elected from persons who are appropriate to bear the role ofenhancing the auditing function such as those who possess abundant experience as management inglobal enterprises or experts who possess profound knowledge and satisfy our independence standards.
Currently, of the five Audit & Supervisory Board members, three are Independent Outside Audit &Supervisory Board Members.
Standards for Independence of Outside Directors/Audit & Supervisory Board Members of
JFE Holdings, Inc. (https://www.jfe-holdings.co.jp/en/company/info/pdf/independence.pdf)
ESG Data: Directors and Audit & Supervisory Board Members (P. 192)

JFE GROUP CSR REPORT 2020

151

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Approach to Diversity in the Board of Directors
With regard to the composition of the Board of Directors, the company elects officers following
deliberations by the Nomination Committee by focusing on the enhancement of diversity of the Board
members, such as their expertise, knowledge and experience in various fields, while balancing with theappropriate size of the Board. One female Audit & Supervisory Board Member was appointed in June
2019, and one female Director was appointed in June 2020. The company is also working to enhance
gender and global diversity mainly by electing Directors and Audit & Supervisory Board Members who
possess a wealth of knowledge and experience as management in global enterprises. The company willcontinue to systematically engage in initiatives to foster such human resources suitable for candidates
for Directors and Audit & Supervisory Board Members by setting specific targets.

Nomination Committee and Remuneration Committee
In October 2015, JFE Holdings set up the Nomination Committee and the Remuneration Committee asadvisory bodies to the Board of Directors to secure fairness, objectivity and transparency in theappointment of and remuneration for Directors and Audit & Supervisory Board Members. For bothcommittees, the majority of committee members are Outside Directors/Audit & Supervisory Board
Members and the chairs are chosen from among these people.
The Nomination Committee deliberates and reports to the Board of Directors on matters pertaining
to the basic stance on the election and dismissal of the President of the company, proposals for theelection of candidates for the President of the company, succession plans of the President of thecompany, and the nomination of candidates for Outside Directors and Outside Audit & Supervisory
Board Members. Four meetings were held in FY2019. The Remuneration Committee deliberates
matters pertaining to the basic stance on the remuneration of directors, etc., of the company and each
operating company and reports to the Board of Directors. Three meetings were held in FY2019.
ESG Data: Nomination Committee and Remuneration Committee (P. 195)

Support for Directors and Audit & Supervisory Board Members
Directors and Audit & Supervisory Board Members are provided with opportunities and funding toreceive training in legal matters, corporate governance, risk management and other subjects that help
them fulfill their roles and duties.
In addition, a briefing is held for Outside Directors and outside Audit & Supervisory Board Members
prior to Board of Directors meetings.
Furthermore, Outside Directors and Outside Audit & Supervisory Board Members are provided with
relevant information and opportunities to exchange opinions with the president and other top managers,
attend key hearings on the operational status of individual departments, and inspect business sites andGroup companies inside and outside Japan.

Analysis and Evaluation of the Board’s EffectivenessSince FY2015, JFE Holdings has worked to improve the overall effectiveness of its Board of Directors by
analyzing and evaluating it every year.
In FY2019, third-party questionnaires were sent to all Directors and Audit & Supervisory Board
Members. Based on the discussions by the Board of Directors in light of the survey results andevaluation by the third-party organization, the Board of Directors determined that its overall
effectiveness has been ensured through vigorous discussions among members, including Outside
Directors, based on a preliminary briefing session attended by all Outside Directors/Audit &Supervisory Board Members and appropriately facilitated by the chairperson. In addition, theappointments of a female Audit & Supervisory Board member in June 2019 and a female Director in
June 2020 have helped further diversify the composition of Directors and Audit & Supervisory Board
Members, thereby enabling more fruitful discussions.
JFE GROUP CSR REPORT 2020

152

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Furthermore, in addition to accurate and fair audits performed by the Audit & Supervisory Board
Members, the members also express opinions and actively ask questions at Board of Directors
meetings on management decisions and reports to further invigorate deliberations. Such outcomessupport the conclusion that JFE functions more efficiently as a company with an Audit & Supervisory
Board.
Meanwhile, we are implementing measures to further improve the effectiveness of the Board of
Directors, including enhancing the Board’s response to drastic changes in the business environment asthey relate to the Business Plan and promoting concrete initiatives on ESG issues essential forsustainable growth.

Operating System
Key Decision Making
JFE companies are responsible for business decisions in accordance with their respective rules andprocedures, whereas JFE Holdings makes decisions about Group-wide matters. Each operatingcompany determines key matters through a deliberative process by its own Management Committee
and Board of Directors. In April 2017, JFE Holdings changed the operating structure of key committees.
Management strategies involving the entire group are now deliberated by the Group Management
Strategy Committee and core issues of JFE holdings, the operating companies and the Group aredeliberated by the Management Committee before they are submitted to the Board of Directors forresolution.
ESG Data: Operating System (P. 195)

Executive Remuneration
Executive remuneration is based on the basic policies founded on discussions and reports by the
Remuneration Committee, and it is decided through either a resolution of the Board of Directors ordeliberations by the Audit & Supervisory Board M embers, for an amount within the total limit
approved at the General Meeting of Shareholders.

Basic Stance on Determination of Remuneration for Directors and Audit & Supervisory Board
Members and Corporate Officers
 The Board of Directors shall determine remuneration system for Directors and Corporate Officers
based on deliberations regarding its appropriateness by the Remuneration Committee to ensure
fairness, objectiveness and transparency.
 The remuneration level for Directors and corporate Officers shall be determined to secure excellent
human resources who are able to put the Group’s corporate vision into practice, taking into
consideration the business environment of the Group and remuneration levels at other companies inthe same industry or of the same scale.
 The ratio between basic remuneration and performance-linked remuneration (annual bonus andstock remuneration) shall be properly established according to the roles and responsibilities, etc., ofeach Director and Corporate Officer so as to function as sound incentives toward the sustainablegrowth of the Group.
The company pays only basic remuneration to Outside Directors and Audit & Supervisory Board
Members, given their respective roles of supervising and auditing management from an independentand objective standpoint.
JFE GROUP CSR REPORT 2020

153

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesComposition of Remuneration for Directors and Audit & Supervisory Board Members andCorporate Officers
Medium- to long-term performance-linked remuneration system for Directors and Audit & Supervisory
Board Members has been introduced from FY2018. Remuneration for Directors and Audit &Supervisory Board Members after the introduction of this system is as follows.
 Basic Remuneration
A fixed amount is paid every month according to positions and other factors.
 Annual Bonus
Directors and Corporate Officers, excluding Outside D irectors, receive cash bonuses once a year,
based on a standard determined according to single-year consolidated results. From FY2018 to
FY2020, the “total amount of segment profit” will be used as a performance indicator.
 Medium- to long-term Performance-linked Remuneration
The stock remuneration plan is a plan that provides the company’s shares and an amount of cash
equivalent to the market price of the company’s shares to Directors (excluding Outside Directors)
and Corporate Officers. Remuneration based on this system is paid based on the payment level,
which is determined in accordance with the performance targets, etc., in the Group’s medium-termbusiness plan, and as a rule, it is provided at retirement through a trust in the form of thecompany’s shares or cash.
From FY2018 to FY2020, the payment level is determined according to the level of achievement of
the target profit attributable to owners of the parent company of 200 billion yen per year, set under the
Sixth Medium-term Business Plan. Furthermore, 5% or more ROE is the minimal requirement for thepayment.
Remuneration for the company president when the target goals have been attained is set so that theratio of basic remuneration (fixed remuneration), annual bonus (short-term performance-liked) andstock remuneration (medium- to long-business performance-linked) roughly stands at 6:2:2.
■ Composition of Remuneration for the Company’s Directors and Part-time Audit& Supervisory Board Members

ESG Data: Executive Remuneration (P. 195)

JFE GROUP CSR REPORT 2020

154

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesInternal Control
The JFE Group’s internal control system, in accordance with the Basic Stance for Building an Internal
Control System, is maintained through various committee regulations including the Rules of the Boardof Directors, Regulations for Group Management Strategy Committee, Regulations for Management
Committee, Regulations for the JFE Group CSR Council, Regulations for Organization and Operations,
Regulations for Document Management, Regulations for Addressing Violence Directed at Companies,
and the installation of Corporate Ethics Hotline. The Basic Stance for Building Internal Control Systems
is revised and improved from time to time to boost sustainable corporate value.
Basic Stance for Building an Internal Control System (Japanese only)(https://www.jfe-holdings.co.jp/company/info/pdf/naibutousei.pdf)

Strengthening Internal Control
Internal Audits
JFE Holdings, its operating companies and key Group companies had internal audit organizations
comprising 164 people as of April 1, 2020. These organizations share information to enhance overall
auditing within the Group.

Audits by Audit & Supervisory Board Members
Audit & Supervisory Board Members attend meetings of the Board of Directors, Group Management
Strategy Committee and Management Committee as well as other important meetings. To audit how
Directors execute their responsibilities, they conduct hearings with Directors and corporate officers
regarding operational status and receive operational reports from subsidiaries. In addition toundergoing statutory audits, JFE companies take the following initiatives to ensure the effectiveness ofinternal auditing by the Audit & Supervisory Board Members and to strengthen coordination among theMembers.
A total of 34 full-time Audit & Supervisory Board Members have been appointed to 28 companies,
including JFE Holdings. Operating company personnel are dispatched to Group companies as part-time
Outside Audit & Supervisory Board Members. Each absentee Audit & Supervisory Board Member
serves one to four subsidiaries to raise the quality of the audits by their Audit & Supervisory Board
Members and enhance Group governance. Eleven absentee Audit & Supervisory Board Members
served 30 companies in total.
The JFE Group Board of Auditors includes both full-time Audit & Supervisory Board Members ofeach Group company and part-time Audit & Supervisory Board Members. Subcommittees and working
groups created to address specific issues meet autonomously to share information, investigate issues
and enhance understanding. The findings of the year’s activities are presented at the general meetingof JFE Group Auditors and used for audits.
ESG Data: Operating System (P. 195)

JFE GROUP CSR REPORT 2020

155

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Structure of JFE Group Board of Auditors

Cooperation between Audit & Supervisory Board Members and Accounting Auditor
In FY2019, the Audit & Supervisory Board Members held eight scheduled or unscheduled meetings
with Ernst & Young ShinNihon, JFE’s outside accounting auditor, in which the latter presented its audit
plan, completed work and detailed results. The firm also presented a detailed explanation of its quality
management system to confirm its validity. In turn, the Audit & Supervisory Board Members explained
their own audit plans and other matters to the firm. The two sides also shared opinions on related
matters.

Cooperation between Audit & Supervisory Board Members and Internal Auditing Department
In FY2019, the Audit & Supervisory Board Members held six scheduled or unscheduled meetings with
the internal auditing department, in which the latter presented its internal audit plan, work status anddetailed results. During the meetings, the Audit & Supervisory Board Members also shared opinionswith the department.

Operating Company GovernanceSome Directors, Corporate Officers and Audit & Supervisory Board Members of JFE Holdings serve
concurrently as the Directors or Audit & Supervisory Board Members of operating companies tostrengthen governance and information sharing across the Group. To strengthen governance, JFE
Holdings’ managers attend each operating company’s General Meeting of Shareholders andManagement Planning Briefing, receive reports on their activities and discuss the managerial policies
of subsidiaries.

JFE GROUP CSR REPORT 2020

156

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Policy on Listed Subsidiaries
To realize sustainable growth and enhancement of medium to long-term corporate value, the JFEGroup forms a corporate group comprising companies with high expertise, divides business functions
within the Group and conducts businesses development outside of the Group. Among the Group
companies, Gecoss Corporation, JFE Container Co., Ltd. and JFE Systems, Inc., which are subsidiaries
of JFE Steel Corporation, maintain their listed status as a means to enhance their competitiveness fromthe perspectives of their specialized business areas as well as to secure market recognition andcredibility in funding, sales and marketing, and hiring. The aforementioned 3 companies are subject torules different from those applicable to other consolidated subsidiaries, and other measures are also
taken so as to ensure that each of the companies conducts autonomous corporate activities exercisingautonomy and flexibility, secure management independence as listed companies, and make sure thatthe interest of the said subsidiaries’ shareholders other than the said subsidiaries and the Company
will not be unfairly impaired. In addition, with respect to matters necessary for the Group’s risk
management, prior consultation and reporting are required from the 3 companies while securing their
independent decision making, so as to implement risk management as a member of the Group
companies.
Furthermore, the Company shall regularly verify the significance of maintaining the listing of thelisted subsidiaries and take necessary measures upon confirmation at its Board of Directors.

Basic Policies for Strategic Shareholdings and Exercise of Related Voting Rights
All shares held by the company are the shares of subsidiaries or affiliates. In principle, the company’s
wholly owned subsidiaries and operating companies, JFE Steel Corporation, JFE Engineering
Corporation and JFE Shoji Corporation (hereinafter the “Operating Companies”), do not hold stocks as
strategic shareholdings. Strategic shareholdings, however, are allowed as an exception when holding
the stocks of a company is determined to be necessary for maintaining and achieving growth for theGroup.
The Board of Directors meetings regularly confirm the significance of the strategic shareholdings
and whether the benefits and risks of such holdings are commensurate with their capital cost, and sell
strategic shareholdings if there is no significance of such shareholdings or there is a risk of damage toshareholders’ interest. In April 2016, the Company decided to reduce its strategic shareholdings byapproximately 100 billion yen and sold its strategic shareholdings in the amount of approximately 140
billion yen (on a market value basis) by FY2018.In November 2019, the Company decided on a policy tofurther sell its strategic shareholdings in the amount of 100 billion yen and sold all or part of 45 stocks
in FY2019. (Total sales amount: approximately 23.2 billion yen (on a market value basis).
Furthermore, in FY2019 the Board of Directors at a meeting held in August 2019 examined thesignificance of its strategic holdings and the return on investment. The exercise of voting rights ofstrategic shareholdings is decided upon reviews by Operating Companies on the content of the
proposal and is appropriately implemented in a way that will maximize shareholder interest. To be
specific, the content of the proposal is to be checked by the investment application department and theinvestment control department, and approval will be given to proposals which are considered not topose any threat to the maximization of interest of these Operating Companies as shareholders. Of theshares for investment purposes held by JFE Steel, which has the largest balance sheet amount andaccount for the majority of the shares for investment purposes posted in the consolidated financial
statements of the company, those shares of JFE Steel that are held for purposes other than pureinvestments are shown below.
■ Number of Issues and Amount Reported in the Balance Sheet
End of 2017
Number of issues
Total balance sheet amount (billion yen)

End of 2018

End of 2019

242

238

219

259.1

241.0

166.1

JFE GROUP CSR REPORT 2020157

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesCompliance (including Anti-corruption)
Basic Policy
In expanding our businesses in Japan and abroad, it is important that JFE maintains relationships oftrust with all stakeholders, including its customers, shareholders and local communities. Trust can only
be built upon a strong foundation of ensuring thorough compliance. Misconduct and scandals resulting
from compliance violations can instantly shatter the trust that has taken many years to establish.
Therefore, JFE believes it is extremely important that all members of the organization deepen theirknowledge and awareness of compliance and perform their jobs accordingly. It conducts training on
various topics such as the antimonopoly law, regulations on subcontractors and Anti-corruption
including bribery of public officials via e-learning, guidebooks, guidebook reading sessions, and othermeans.

Compliance System
The JFE Group Standards of Business Conduct guide employees to conduct their business activities
based on the Corporate Vision and Corporate Values. They also help to strengthen awareness among
all JFE Group executives and employees and ensure adherence to corporate ethics.
The Compliance Committee chaired by the president of JFE Holdings generally convenes every
quarter to deliberate basic policies and issues and then supervise their implementation. Each operatingcompany has a similar in-house system for promoting and supervising compliance. In addition,
operating companies have introduced a Corporate Ethics Hotline to ensure that crucial information
regarding compliance can be communicated directly from the front lines to top management.
For more on the JFE Group Standards of Business Conduct, please refer to the following information.
JFE Group Standards of Business Conduct(https://www.jfe-holdings.co.jp/en/company/philosophy/guideline.html)

Ensure Adherence to Corporate Ethical Standards and Compliance
Thorough ComplianceAs part of its initiative to raise awareness of compliance, the JFE Group compiled a Compliance
Guidebook that was distributed to employees and executives (domestic and overseas) to be used in
activities such as collation and to ensure that the rules are fully communicated and informed. The
guidebook provides a simple explanation of concrete standards for complying with laws and internal
rules and for acting in line with social mores with over a hundred case studies.
Questions that come up in the course of daily operations as well as situations and cases that test
our judgment have been compiled in the guidebook with explanations by the relevant department. The
content has been reviewed by legal counsel.
The JFE Group also conducts training on compliance with the Antimonopoly Act, insider trading
restrictions, security export controls, the Construction Business Act, laws against bribery of public
officials, and more.

JFE GROUP CSR REPORT 2020158

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Whistleblowing System
The JFE Group has established a Corporate Ethics Hotline to ensure that crucial information regarding
compliance, including violation of the Antimonopoly Act, bribery, or all kinds of workplace harassment
can be communicated directly from the front lines to top management rapidly and accurately. The
hotline is accessible to all officers and employees of the JFE Group as well as those of suppliers andother business partners. Reports and consultations are accepted via e-mail, a dedicated phone line andpostal mail, and an external hotline to an independent law firm is also provided.
To encourage the active sharing of information, the Corporate Ethics Hotline is operated underrules and regulations that ensure strict confidentiality and protect people who report information or
seek advice against acts of retaliation. We investigate the facts of any reported incident only after
consulting with the whistleblower to protect their privacy.
In the event that violations of human rights and other laws are confirmed, corrective measures aretaken with regard to the organization involved. We provide feedback on the result of investigations to
the whistleblower upon request. Whistleblowing and requests for advice are regularly reported to fulltime Audit & Supervisory Board M embers, and the operational status of the system is reviewed by the
Board of Directors.
We accept inquiries on compliance and other issues from outside stakeholders via a form on thecorporate website. The content is handled as confidential and appropriately addressed.
■ Whistleblowing System

Anti-corruption
Under its Standards of Business Conduct, the JFE Group endeavors to comply with laws andordinances, compete fairly and freely, refrain from illegal business activities, and build and maintainsound and proper relationships with governments and political authorities.
We explicitly prohibit bribery, such as the offering and receiving of illegal payoffs, excessive
entertaining or favors, as well as corruption such as embezzlement from a position of advantage andpromotion of conflicting interests. The company rules state that these offenses will be penalized.
JFE GROUP CSR REPORT 2020

159

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesPreventing Bribery
Under its Standards of Business Conduct, the JFE Group endeavors to build and maintain sound andproper relationships with governments and political authorities. The bribing of public officials has
become a major business risk in recent years due to growing global awareness of corruption and astronger drive by authorities to expose such wrongdoing. The JFE Group does not tolerate any kind ofillegal activity in Japan or any other country, including bribery, such as offering money or other benefits
to public officials, and never resorts to these illegal activities to gain profit or resolve problems. Basedon these thoughts, the Group issued JFE Group’s Basic Stance on Preventing Bribery of Public Officials
and disseminate it throughout the Group including operating companies. The JFE Group also maintains
various systems to prevent the bribery of public officials.
For our stance on preventing bribery, please refer to the following information.
JFE Group’s Basic Policy on Preventing Bribery of Public Officials(https://www.jfe-holdings.co.jp/en/company/philosophy/anti-bribery.html)

Resisting Organized Crime
The JFE Group declares in its standards of business conduct that it will firmly resist all antisocial
forces and has established the JFE Group Policies for Addressing Antisocial Forces and Regulations for
Addressing Violence Directed at Companies to clarify the measures to be taken against antisocial
forces, including an initial response manual.
The JFE Group Policies for Addressing Antisocial Forces has been approved by the Board of
Directors, and we will seek to establish sound corporate management based on an organized andunified response to the issue within the framework of our system of compliance. We have specificallyset up a section responsible for handling antisocial forces in the General Administration and Legal
Affairs departments of each Group company to completely discontinue any dealings with antisocial
forces. We will also set up rules for reporting and responding to any related incidents and will
resolutely stand against antisocial forces by cooperating with law enforcement.
In addition, we will seek to establish thorough awareness of the JFE Group Policies for Addressing
Antisocial Forces and specific rules governing our response among all executives and employees by
providing e-learning and distributing the Compliance Guide Book.

Compliance with the Antimonopoly Law
The JFE Group views past violations of the Antimonopoly Act seriously and continues to implement
thorough measures to eliminate the possibility of future infringements. The internal audit departmentsof the two Group companies involved in the violations, JFE Steel and JFE Engineering, are auditingtransactions with other companies to ensure compliance with the Antimonopoly Law by confirming thatno activities are suspected of violating the law. The audits are being conducted regularly at each office,including branches and branch offices. Each Group company is implementing similar measures toprevent violations of the Antimonopoly Law.

Confirmation and Improvement through the Employee Awareness Survey
The JFE Group regularly conducts a Corporate Ethics Awareness Survey for directors and employees of
the Company as well as the operating companies to confirm the penetration and thorough complianceof the Group’s Corporate Vision, Corporate Values, and Standards of Business Conduct, along with theidentification of potential risks. The survey conducted in 2019 confirmed that many employees
acknowledged the vision and corporate policy and are aware of compliance matters when carrying out
their work. On the other hand, the survey also brought to our attention issues to address going forward.
The survey results were reported to the Board of Directors and JFE Group CSR Council, and eachcompany worked on reflecting the information in their specific initiatives.
JFE GROUP CSR REPORT 2020160

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Risk Management
Risk Management System
JFE Holdings is responsible for comprehensive risk management in accordance with its Basic Stancefor Building an Internal Control System. The JFE Group CSR Council, which is chaired by the Presidentof JFE Holdings, collects specific information and enhance management for the purpose of reducing
the frequency and impact of risks. The Corporate Officer responsible for risk works to identify potential
risks associated with business activities, ethical and regulatory compliance, the disclosure of financial
reports and information, as well as ESG risks such as climate change, which have become increasingly
important in risk management. If potential risks are identified, they are reviewed and assessed at an
appropriate meeting as necessary for further examination or the deployment of countermeasures. The
Board of Directors supervises the ESG risks of the JFE Group by receiving reports and holding
discussions on its material issues.
For our risk management policies and systems, please refer to the following information.
Basic Policy for Building Internal Control Systems (Japanese only)(https://www.jfe-holdings.co.jp/company/info/pdf/naibutousei.pdf)

CSR Structure: JFE Group CSR Council (P. 29)
Compliance (including Anti-corruption) : Development of the Whistleblowing System (P. 159)

Response to Specific Risks
Response to Climate Change Risks
As an enterprise engaged in iron and steel manufacturing, which is associated with emitting massive
volumes of CO2, climate change is a critical managerial concern from the perspective of business
continuity. Risks are identified and evaluated based on a scenario analysis conducted under theframework recommended by the TCFD, and important factors that may affect management are
selected for further analysis and used in formulating future business strategies.
For climate change risks and opportunities, please refer to the following information.
JFE Group’s Response to the TCFD (P. 74)

Intellectual Property Management
The JFE Group meticulously manages intellectual property across its diverse business activities. To
prevent infringement on third-party intellectual property, it constantly monitors the latest information
on intellectual property and implements all necessary measures.

JFE GROUP CSR REPORT 2020

161

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Privacy Protection
JFE has established the JFE Group Privacy Statement for managing information including “My
Numbers,” which are personally identifiable numbers under Japan’s social security and tax number
systems. To maintain the appropriate protection of personal information, employee trainings on therules, which have been set in place in accordance with the privacy statement, have been conducted as
stipulated in applicable laws of each country related to businesses and guidelines.
To reduce information security risks, including cyber-attacks and improper system use such asleaks of personal information, and to promote safe business activities, the JFE-Security Integration andResponse Team (JFE-SIRT), comprising the IT division managers of each operating company,
participates in the Nippon CSIRT Association, established by private sector volunteers and corporate
Computer Security Incident Response Teams (CSIRTs) active in Japan. We seek to enhance the levelof our initiatives by exchanging information and coordinating on security incidents.
For privacy protection policies, please refer to the following information.
JFE Group Privacy Statement (https://www.jfe-holdings.co.jp/en/privacy.html)

Information Security
The JFE Group formulates various rules on information security management to prevent information
leakage and system failures due to cyber-attacks and improper system use. Efforts are made toenhance information-security knowledge and awareness of rules among employees through training
and education. Additionally, shared IT measures are applied in each Group company and regular
information security audits are conducted to reinforce the overall information security managementlevel in the Group.
Key issues related to information security are deliberated by the JFE Group Information Security
Committee to determine Group policy.
Applying the policies set by the committee, the JFE-SIRT* formulates and implements informationsecurity measures, performs information security audits, offers guidance on responding to incidents
and generally enhances the level of Group-wide information security management. JFE-SIRT reports
on its activities to the Group CSR Council as appropriate.
* Established in April 2016.
■ JFE Group Information Security Governance System

JFE GROUP CSR REPORT 2020

162

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Group’s Business Continuity Plan
Anticipating the possibility of natural disasters caused by typhoons and major earthquakes as well as a
rapid expansion of infectious diseases such as a new strain of influenza, the JFE Group has formulated
a business continuity plan (BCP) to address contingencies.. We conduct regular training based on the
BCP while also pursuing other countermeasures.

Response to Major Natural Disasters
We are preparing to respond in the event of a major earthquake through measures such as establishingtsunami shelters, maintaining a Company-wide line of command under restricted communications andpower outages, and securing data backup. We have also strengthened drainage at our steelworks toaddress the impact of typhoons and torrential rains that are occurring in Japan with increasing severity.

Response to the COVID-19 Pandemic
We have addressed the COVID-19 pandemic by quickly setting up a response team and implementing
measures based on the policies for an assumed outbreak of a new strain of influenza. We have sought
to reduce commuting by relaxing internal requirements to recommend various styles of working at
home. For employees who must work at the office, we have adopted staggered commuting, installed
office partitions and are using teleconferencing and other means to reduce the risk of infection insofar
as possible. In particular, JFE Steel has reviewed its BCP for the novel influenza epidemic andconducted a simulation to gauge the effects on operations in case an increase in the number of
infections leads to a rise in the absence rate. The company is preparing responses to diverse
situations to maintain key businesses including operations at our steelworks. We will continue to place
top priority on the safety and wellness of employees and others involved in the company by practicing
thorough hygiene management and implementing a remote working infrastructure.
Through these initiatives, we also seek to explore more flexible workstyles and improve theproductivity of our workforce.

JFE GROUP CSR REPORT 2020

163

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesTax Transparency
Basic Policy
The JFE Group upholds the JFE Standards of Business Conduct and complies with both the letter andspirit of the tax laws of each country as well as international rules, including the taxation guidelines
issued by the Organization for Economic Co-operation and Development and other international
institutions. We will pay taxes in every country where we do business in a timely, appropriate, and fairmanner.
Moreover, we seek to forge relationships of trust with the tax authorities in each country by raisingtransparency and without resorting to tax planning or the use of tax havens to evade taxation.

JFE GROUP CSR REPORT 2020

164

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Environmental Data
* Abbreviations indicated under "scope" represent the following group or company:
JFE Group [All]; JFE Steel Group [ST Gr]; JFE Steel [ST]; JFE Engineering Group [EN Gr];JFE Engineering [EN]; JFE Shoji Group [SH Gr]; JFE Shoji [SH]

Environmental Management■ Data Regarding Environmental Management
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019

%

54

50

54

54

58

ST Gr

%

21

19

20

20

21

EN Gr

%

5

5

5

5

8

SH Gr

%

28

26

29

29

29

%

77

76

70

72

75

ST Gr

%

-

-

-

72

75

EN Gr

%

-

-

-

60

66

SH Gr

%

-

-

-

88

92

ST Gr

sites

37

34

31

31

32

EN Gr

sites

48

46

48

50

48

EN Gr

people

1,127

1,426

996

1,059

1,063

All
Base
% covered by
ISO 14001
certification

All
Empl
oyee

Environmental audit(number of sites)
Environmental
education conducted(total participants)■ Environmental Accounting Data (1)Breakdown of environmental protection cost

FY2018FY2019Investment(billion yen)

Cost(billion yen)

Investment(billion yen)

Cost(billion yen)

Impact monitoring and measurement,
and EMS expenses and education

0.3

2.7

0.1

2.6

Global warming
countermeasures

Saving and efficiently using energy

12.4

28.6

26.7

27.6

Recycling industrial water

2.4

17.8

3.9

18.3

Conservation ofnatural resources

Recycling and waste management ofinternally generated materials, etc.

1.77

4.8

0.06

5.1

Air pollution countermeasures

9.9

31.6

11

34.1

Water pollution countermeasures

1.8

10

4.1

11.3

Prevention of soil contamination, noise,
vibration, and subsidence

0

0.6

0.04

0.6

Other

Charges, etc.

-

1.6

-

1.5

R&D

Technologies for protecting theenvironment, saving energy, andpreventing global warming

1.2

12.9

1

11.3

Management

Environmental
protection

JFE GROUP CSR REPORT 2020

165

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
FY2018

Breakdown of environmental protection cost

Investment(billion yen)

Cost(billion yen)

Investment(billion yen)

Cost(billion yen)

-

0.7

-

0.7

29.8

111.3

46.8

113.1

Support for nature preservation andforestation, information disclosure,exhibitions, and public relations

Societal
activities

FY2019Total

Note: Data cover all investment activities of JFE Steel Corporation and R&D activities of JFE Engineering
Corporation.
■ Environmental Accounting Data (2)
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019Energy-saving investment(accumulated)Allbillion
yen

466.2

474.9

492.9

505.4

532.1

Environmental protection
investment (accumulated)Allbillion
yen

634.0

668.5

692.4

708.5

727.6

Environmental Management (Supplementary Data)■ List of ISO 14001 Certified Companies (includes certification limited to certain sites of a company)
Operating company*1

JFE Steel Corporation

Group company
JFE MINERAL COMPANY, LTD.

JFE Plant Engineering Co., Ltd.*2

Mizushima Ferroalloy Co., Ltd.

JFE Techno-Research Corporation*2

JFE Material Co., Ltd.

JFE Metal Construction Inc.*2

JFE Plastic Resource Corporation

JFE KYOWA YOKI CO. LTD*2

JFE Bars & Shapes Corporation

Japan Pail Corporation*2

JFE Galvanizing & Coating Co., Ltd.

JFE SETOUCHI LOGISTICSCORPORATION*2

JFE Container Co., Ltd.

Guangzhou JFE Steel Sheet Co., Ltd.*3

JFE Welded Pipe Manufacturing Co.,Ltd.

Thai Coated Steel Sheet Co., Ltd.

JFE Pipe Fitting Mfg. Co., Ltd.

Philippine Sinter Corporation

JFE LOGISTICS CORPORATIONJFE Steel Galvanizing (Thailan)

JFE Chemical Corp.

PT. JFE Steel Galvanizing Indonesia

DAIWA KOHTAI CO. LTD*2
JFE Engineering
Corporation

J&T Recycling Corporation

Fujikako, Inc.

JFE Aqua Machine and Service
Corporation

Asuka Soken Co,. Ltd.

JFE Environmental Service Corporation

JFE GROUP CSR REPORT 2020

166

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Operating company*1

JFE Shoji Corporation

Group company
JFE Shoji Coil Center Corporation

JFE Shoji Matech Inc.*2

JFE Shoji Kohnan Steel Center Co.,Ltd.

Kawasho Foods Corporation*2

Taisei Kogyo Corporation

K&I Tabular Corporation*2

Toyo Kinzoku Corporation

Tohsen Corporation*2

Naigai Steel Corporation

Hoshi Kinzoku Corporation*2

NIHON JISEIZAI KOGYO CO., LTD.

Dongguan JFE Shoji Steel Products Co., Ltd.

Hokuriku Steel Co., Ltd.

Guangzhou JFE Shoji Steel Products Co., Ltd.

Mizushima Steel Corporation

Zhejiang JFE Shoji Steel Products Co., Ltd.

Mizushima Metal Products
Corporation

Jiangsu JFE Shoji Steel Products Co., Ltd.

JFE Shoji Electrical Steel Co., LTD.

JFE SHOJI STEEL PHILIPPINES, INC.

JFE Shoji Usuitakenzai Corporation*2

CENTRAL METALS (Thailand) Ltd.

JFE Shoji Electronics Corporation*2

JFE SHOJI STEEL VIETNAM CO., LTD.

JFE Shoji Pipe & Fitting Corporation*2

JFE SHOJI STEEL HAI PHONG CO., LTD.

JFE Shoji Service Corporation*2

JFE SHOJI STEEL MALAYSIA SDN. BHD.

JFE Shoji Machinery & Materials
Corporation*2

PT. JFE SHOJI STEEL INDONESIAJFE Shoji Steel Construction Materials
Corporation*2

JFE SHOJI STEEL DE MEXICO,S.A. DE C.V.

JFE Shoji Terre One Corporation*2

JFE SHOJI STEEL INDIA PVT. LTD.

JFE Shoji Business Support, Inc.*2*1 ISO 14001 certification is acquired at all manufacturing bases of JFE Steel and JFE Engineering and at
all JFE Shoji's business establishments in Japan.
*2 Excluded from the scope of ESG data collection.
*3 Equity-method affiliates.

JFE GROUP CSR REPORT 2020

167

Message fromthe CEO

JFE Group
VisionGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyUnit

FY2015FY2016FY2017FY2018FY2019million
t-CO2

61.5

61.8

62.2

59.9

60.4

million
t-CO2

61.4

61.7

62.1

59.7

60.0

ST*3

million
t-CO2

57.3

57.5

58.5

55.4

56.1

ST
subsidiaries

million
t-CO2

4.1

4.2

3.6

4.3

3.9

EN Gr

thousand
t-CO2

63.7

62.9

56.5

212

403

EN

thousand
t-CO2

18.3

16.6

17.3

17.5

16.8

EN
subsidiaries

thousand
t-CO2

45.4

46.3

39.3

195

386

SH Gr

thousand
t-CO2

33.2

31.4

35.0

35.6

34.7

SH

thousand
t-CO2

0.6

0.5

0.5

0.5

0.5

SH
subsidiaries

thousand
t-CO2

32.7

30.9

34.6

35.1

34.2

million
t-CO2

54.7

55.0

54.9

52.3

52.9

million
t-CO2

-

-

-

52.1

52.5

ST*3

million
t-CO2

52.3

52.6

52.5

49.2

49.8

ST
subsidiaries

million
t-CO2

-

-

-

3.0

2.7

EN Gr

thousand
t-CO2

-

-

-

171

361

EN

thousand
t-CO2

-

-

-

7.8

3.8

EN
subsidiaries

thousand
t-CO2

-

-

-

163

357

CSR
Management

Environment

SocialGuideline
Indices

Climate Change■ CO2 Emissions by Scope
Items

Scope
All
ST Gr

Scopes 1 and 2 total*1

All
ST Gr

Scope 1*4*5

JFE GROUP CSR REPORT 2020168

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019million
t-CO2

6.6

6.4

7.4

7.6

7.6

million
t-CO2

-

-

-

7.5

7.5

ST*3

million
t-CO2

5.0

4.9

6.0

6.2

6.3

ST
subsidiaries

million
t-CO2

-

-

-

1.3

1.2

EN Gr

thousand
t-CO2

-

-

-

41.6

42.2

EN

thousand
t-CO2

-

-

-

9.7

12.9

EN
subsidiaries

thousand
t-CO2

-

-

-

31.9

29.3

SH Gr

thousand
t-CO2

33.2

31.4

35.0

35.6

34.7

SH

thousand
t-CO2

0.6

0.5

0.5

0.5

0.5

SH
subsidiaries

thousand
t-CO2

32.7

30.9

34.6

35.1

34.2

All
ST Gr

Scope 2*2

Unit CO2 emissions(numerator: Scopes 1 and 2
total; denominator: sales)*6

All

t-CO2/
billion yen

17,923

18,684

16,89815,463

16,206

Scope 3*7*8All

thousand
t-CO2

8,885

13,907

16,272

16,751

16,382Category 1
Purchased goods andservicesAll

thousand
t-CO2

7,334

11,01913,04813,371

12,557

Category 2
Capital goods

Allthousand
t-CO2

−

840

921

1,180

1,401

Category 3
Fuel and energy related
activities not included in
Scopes 1 or 2

All

thousand
t-CO2

269

348

386

370

728

Category 4
Upstream transportationand deliveryAllthousand
t-CO2

341

647

650

491

489

Category 5
Waste generated inoperations

All

thousand
t-CO2

92

155

87

100

57

Category 6
Business travelAll

thousand
t-CO2

2

4

4

4

4

JFE GROUP CSR REPORT 2020

169

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019Category 7
EmployeecommutingAll

thousand
t-CO2

29

46

54

49

49

Category 15
InvestmentsAllthousand
t-CO2

818

848

1,122

1,186

1,097

*1 Data cover 76 companies• JFE Steel and 30 major domestic and overseas subsidiaries• JFE Engineering and 10 major domestic subsidiaries• JFE Shoji and 33 major domestic and overseas subsidiaries.
*2 CO2 Emission Factor for Purchased Electricity in FY2019:• JFE Steel uses the emission factor of the Commitment to a Low Carbon Society of the Japan Iron and SteelFederation for energy purchased in FY2018.
• JFE Steel’s domestic consolidated subsidiaries, the JFE Engineering Group, and the JFE Shoji Group apply the
adjusted emission factors of each electric power company for each fiscal year.
• Overseas: based on each country’s GHG protocol*3 Data from FY2015 to FY2016 includes the Sendai Works of JFE Bars & Shapes Corporation.
*4 Data for JFE Steel include CO2 emissions from non-energy sources.
*5 Starting with FY2018, data for JFE Steel’s subsidiaries and JFE Engineering’s subsidiary include CO2 emissions from
non-energy sources.
*6 The JFE Group changed its accounting standards from JGAAP to IFRS in FY2018.
*7 Coverage:(Categories 1, 2, 3, 4, 5)

JFE Steel, 25 JFE Steel domestic subsidiaries, JFE Engineering, and JFE Shoji(Category 6, 7)

JFE Steel, 25 JFE Steel domestic subsidiaries, JFE Engineering, 10 JFE Engineering
domestic subsidiaries, and JFE Shoji(Category 15)

Japan Marine United, and 9 JFE Steel equity-method affiliates (7 domestic and 2
overseas)*8 Sources: Green Value Chain Platform (Ministry of the Environment) and others

JFE GROUP CSR REPORT 2020

170

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices■ Other Greenhouse Gas
Items

CO2
emissionsfromenergysources

Unit

FY2015FY2016FY2017FY2018FY2019ST*1

million
t-CO2

55.5

55.7

56.6

53.5

54.2

EN Gr*2

thousand
t-CO2

63.7

62.9

56.5

66.7

67.5

Scope1

ST*1

million
t-CO2

50.5

50.8

50.5

47.3

47.9

Unit: CO2
emissions(denominator:
crude steel
production)

ST*1

t-CO2/t-s

1.98

1.94

1.99

2.03

2.03

ST Gr*3

million
t-CO2

−

−

−

2.61

2.65

ST

million
t-CO2

1.85

1.85

1.91

1.87

1.89

ST
subsidiaries

million
t-CO2

−

−

−

0.74

0.76

million
t-CO2

−

−

−

0.15

0.34

thousandt-CO2e

91.0

93.7

94.8

88.7

103.3

All (ST only)

thousandt-CO2e

71.3

73.4

76.2

72.2

72.9

All

thousandt-CO2e

19.7

20.3

18.6

16.5

30.4

ST

thousandt-CO2e

19.7

20.3

18.6

16.5

20.0

J&T
Recycling
Co.*4

thousandt-CO2e

-

-

-

-

10.4

ST Gr

million
t-CO2

0.45

0.65

0.65

0.66

0.65

ST

million
t-CO2

0.34

0.33

0.37

0.40

0.40

ST
subsidiaries

million
t-CO2

0.11

0.32

0.28

0.26

0.25

CO2 emissions(Scopes 1 and 2
total)

Scope

CO2 emissions from nonenergy sources

J&T Recycling
Co.*4
GHG emissions other than CO2 All
Methane (CH4)N2O

GHG emitted duringtransportation*5

Contribution to CO2 emission
reductions by renewableenergy plantsENmilliont-CO2/year

-

3.17

4.06

4.12

4.13

Biomass power
generationEN

milliont-CO2/year

-

1.30

1.97

2.12

2.12

Waste power
generationEN

milliont-CO2/year

-

1.61

1.64

1.53

1.53

Biogas,geothermal, solar
power, wind, etc.

EN

milliont-CO2/year

-

0.26

0.46

0.47

0.48

JFE GROUP CSR REPORT 2020

171

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices（Continued from the previous page.）*1 Data from FY2015 to FY2016 includes the Sendai Works of JFE Bars & Shapes Corporation.
*2 Data cover JFE Engineering and 10 consolidated subsidiaries in Japan.
*3 Data cover JFE Steel and 2 consolidated subsidiaries in Japan.
*4 J&T Recycling Co. is a domestic subsidiary of JFE Engneering.
*5 Data cover JFE Steel and 11 domestic and overseas subsidiaries, which are specified consigners designated under
the Japanese Energy Saving Act. For Others, data up to FY2015 consist of emissions from trucks and railways usedby the Group companies, while the scope is expanded to truck, rail and ship from FY2016.

■ Energy
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019

PJ

-

-

-

-

670.1

All
ST Gr

PJ

-

-

-

-

668.6

ST*1

PJ

632.8

640.9

644.0

613.3

619.8

ST
subsidiaries

PJ

-

-

-

-

48.8

EN Gr

PJ

-

-

-

-

1.3

SH Gr

PJ

-

-

-

-

0.2

Energyconsumption

Energyconsumption
and unit
energyconsumption

Recoveredenergy forrecycling

Unit energy
consumption(crude steel
production)

ST*1

GJ/tsteel

22.6

22.3

22.6

23.3

23.2

Energyconsumption(Crude petroleum
equivalent)

EN

kl

9,189

10,665

10,96010,886

8,788

YOY ratio of unit
energyconsumption

EN

%

96.2

92.9

97.4

95.4

80.7

Supplied tosociety

ST

%

35

35

37

39

39

Consumedinternally

ST

%

65

65

63

61

61

*1 Data from FY2015 to FY2016 includes Sendai Works of JFE Bars & Shapes Corporation.

■ Modal Shift Rate
Items
All transportation
Transportation of a
distance of 500 km or
more

Scope

Unit

FY2015FY2016FY2017FY2018FY2019Ship and rail

ST

％

61.5

66.1

66.1

60.2

59.6

Truck

ST

％

38.5

33.9

33.9

39.8

40.4

Ship and rail

ST

％

95.5

94.7

92.7

91.6

90.9

Truck

ST

％

4.5

5.3

7.3

8.4

9.1

Scope of calculation: All products and half-finished products transported in JapanJFE GROUP CSR REPORT 2020172

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Climate Change (Supplementary Data)■ CO2 Emissions and Energy Consumption of JFE Steel Group Subsidiaries (FY2019)
Company name

CO2 emissions (unit: t-CO2)

Energy consumption (unit: GJ)

JFE MINERAL COMPANY, LTD.

1,119,896

6,323,962

JFE Bars & Shapes Corporation

532,848

9,828,342

Mizushima Ferroalloy Co., Ltd.

324,790

3,123,575

JFE Chemical Corp.

253,340

4,907,869

JFE LOGISTICS CORPORATION

167,7032,392,170

JFE Material Co., Ltd.

61,8981,095,040

JFE Galvanizing & Coating Co., Ltd.

68,151

1,382,272

JFE ROCKFIBER CORPORATION

38,077569,191

JFE Pipe Fitting Mfg. Co., Ltd.

16,337351,791

JFE Plastic Resource Corporation

22,142389,888

MIZUSHIMA RIVERMENT CORP.

12,801

168,198

JFE Container Co., Ltd.

10,397

218,321

J-Logitec Co., Ltd.

8,960

130,706

Galvatex Corporation

7,986

153,038

JFE Metal Products & Engineering Inc.

8,403

210,285

JFE Welded Pipe Manufacturing Co., Ltd.

8,257

177,660

JFE Techno-wire Corporation

6,662

142,912

JFE PRECISION CORPORATION

6,439

117,672

K-PLASHEET CORPORATION

4,447

95,381

JFE LIFE CORPORATION

6,714

131,256

CHIBA RIVERMENT AND CEMENT CORP.

4,601

87,655

JFE KENZAI FENCE CO., LTD.

4,274

80,167

JFE Steel Pipe Co., Ltd.

3,160

65,744

GECOSS CORPORATION

3,333

67,268JFE Kozai Corporation

3,440

73,0835 overseas companies

1,217,681

16,549,387

Total

3,922,737

48,832,833

JFE GROUP CSR REPORT 2020173

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ CO2 Emissions from Energy Sources and Energy Consumption of JFE Engineering Group Subsidiaries (FY2019)
Company name

CO2 emissions (unit: t-CO2)

Energy consumption (unit: GJ)

J&T Recycling Corporation

41,475810,841

J Farm Corporation

2,819

53,319Fujikako, Inc.

2,198

44,112NORTHERN JAPAN MACHINERY Corporation

1,055

17,738

Tohoku Dock Ironworks Corporation

994

18,259JFE Environmental Service Corporation

894

13,519Asuka Soken Co,. Ltd.

726

12,356

JFE Pipeline Engineering Corporation

376

5,849

JFE Technos Corporation

172

2,891

JFE Aqua Machine and Service Corporation

45

955

50,754

979,839

Total

Prevention of Pollution■ Air Emissions
Items

Scope

FY2015FY2016FY2017FY2018FY2019ST Gr

million Nm3

4.0

4.5

4.7

4.1

4.3

ST

million Nm3

4.0

4.5

4.6

4.1

4.3

ST
subsidiaries

million Nm3

0.03

0.03

0.05

0.04

0.04

ST Gr

million Nm3

10.6

11.1

11.7

10.7

11.3

ST

million Nm3

10.4

10.9

11.5

10.5

11.1

ST
subsidiaries

million Nm3

0.24

0.22

0.20

0.19

0.17

SOx emissions*1

NOx
emissions*1

Unit*1 13 JFE Steel consolidated subsidiaries in Japan.

■ Release to Waterways
Items
COD (chemical
oxygen demand)

Scope

Unit

FY2015FY2016FY2017FY2018FY2019

ST

t/day

3.1

3.1

3.0

3.3

3.2

ST
subsidiaries*1

t/day

0.08

0.13

0.14

0.17

0.15

EN

kg/day

6.0

6.1

5.6

6.8

8.4

*1 12 JFE Steel consolidated subsidiaries in Japan.

JFE GROUP CSR REPORT 2020174

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices

FY2018FY2019■ Chemical Substances Management
Items

Scope
All*1

Amountreleased

PRTR-registeredsubstances*2

FY2015FY2016FY2017

t

-

-

-

1,019

925

ST Gr

t

842

842

897

814

773

ST

t

456

429

516

545

488

ST
subsidiaries

t

386

413

381

269

285

EN Gr

t

-

-

-

205

152

EN

t

104

87

85

147

107

EN
subsidiaries

t

-

-

-

58.4

45.4

t

-

-

-

9,210

7,867

ST Gr

t

8,638

7,047

8,934

9,176

7,833

ST

t

3,590

2,212

2,726

2,533

1,866

ST
subsidiaries

t

5,048

4,835

6,208

6,643

5,967

EN Gr

t

-

-

-

34

34

EN

t

24

28

28

28

29

EN
subsidiaries

t

-

-

-

5.7

5.4

All*1

Amounttransferred

Unit*1 JFE Shoji is not included in the scope of the report as the company is not subject to PRTR registration.
*2 Coverage:• JFE Steel and 18 consolidated subsidiaries in Japan.
• JFE Engneering and 4 consolidated subsidiaries in Japan.

JFE GROUP CSR REPORT 2020

175

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
IndicesPrevention of Pollution (Supplementary Data)■ SOx and NOx Emissions of JFE Steel Group Subsidiaries (FY2019)
Company name

SOx emissions(unit: Nm3)

NOx emissions(unit: Nm3)

JFE Material Co., Ltd.

10,167

20,269JFE Chemical Corp.

9,514

34,728JFE MINERAL COMPANY, LTD.

7,919

64,174JFE Bars & Shapes Corporation

13,1409,749

JFE Galvanizing & Coating Co., Ltd.

1,874

11,535

JFE PRECISION CORPORATION

192

1,313

Mizushima Ferroalloy Co., Ltd.

338

22,603K-PLASHEET CORPORATION

175

0JFE Container Co., Ltd.

145

0

JFE Plastic Resource Corporation

165

464

CHIBA RIVERMENT AND CEMENT CORP.

35

610

JFE Metal Products & Engineering Inc.

53

1,803

JFE Pipe Fitting Mfg. Co., Ltd.

24

858

MIZUSHIMA RIVERMENT CORP.

0

1,027

Galvatex Corporation

0

683

43,741

169,817

Total

Efficient Use of Natural Resources■ Natural Resources
Items

Input

Products
supplied

Scope

Unit

FY2015FY2016FY2017FY2018FY2019Raw materials forsteel production

ST

milliontonnes

69.0

70.1

71.3

66.0

67.0

Iron oreSTmilliontonnes

43.4

43.5

43.5

40.1

41.4

Coal

ST

milliontonnes

19.9

21.0

22.0

20.6

20.3

Lime

ST

milliontonnes

5.7

5.6

5.8

5.3

5.3

Recycled
materials (steel
scrap)

ST

milliontonnes

0.6

0.7

1.2

1.3

1.1

Raw materials

EN

thousandtonnes

32.9

39.1

41.8

47.3

39.4

Steel products

ST*1

milliontonnes

28.0

28.8

28.5

26.3

26.7

Engineering
products

EN

thousandtonnes

31.2

36.1

39.7

44.5

36.6

*1 Data from FY2015 to FY2016 includes the Sendai Works of JFE Bars & Shapes Corporation.
JFE GROUP CSR REPORT 2020

176

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices■ Co-products and Wastes
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019ST Gr

milliontonnes

15.4

15.3

16.2

16.1

15.6

ST

milliontonnes

14.6

14.5

15.7

15.3

15.1

ST
subsidiaries

milliontonnes

0.771

0.776

0.539

0.792

0.546

Amountgenerated*1

Co-products

Amountrecycled
internallySTmilliontonnes

3.6

3.7

4.2

6.0

5.0

Internal recycle
rate

ST

%

24.6

25.4

27.5

39.3

32.9

ST Gr

milliontonnes

-

0.087

0.081

0.081

0.074

ST

milliontonnes

0.042

0.045

0.047

0.052

0.043

ST
subsidiaries

milliontonnes

-

0.042

0.034

0.029

0.031

Landfillamount*1

Recycling rate

ST

%

99.7

99.7

99.7

99.7

99.7

Co-products
generatedST

milliontonnes

14.6

14.5

15.4

15.3

15.1

ST

milliontonnes

11.0

10.8

11.2

9.2

10.1

ST

%

75.1

74.3

72.2

60.4

66.8

-

-

158.0

131.7

211.0

t

340.2

320.8

429.8

386.4

367.1

Yokohama
HO

t

258.4

241.7

357.1

299.9

299.0

Tsu works

t

81.8

79.1

72.7

86.5

68.2

t

816.3

973.2

773.0

1,039.3

1,340.5

Tsurumi
works

t

252.1

443.4

302.3

506.6

653.8

Tsu works

t

564.2

529.8

470.7

532.7

686.7

Marine, land,
Used by local
and civil
communities
engineering
material (using
Rate of local
co-products)
communities
use
Amountgenerated*2*3

thousandtonnesEN Gr
ENOfficesWastesEN
Productions

JFE GROUP CSR REPORT 2020

177

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019ConstructionsENt91,308.9

101,812.2

88,140.4

109,045.2

145,397.7

Subsidiaries

EN
subsidiaries

t

-

-

69,835.7

22,634.4

63,876.7

EN Grt

1,877.5

1,954.4

1,666.5

2,125.1

4,489.3

EN

t

9.2

8.4

9.0

10.7

8.5

Yokohama
HO

t

3.2

3.3

4.3

4.1

3.3

Tsu works

t

6.0

5.1

4.7

6.6

5.2

t

374.0

329.8

289.0

353.3

312.6

Tsurumi
works

t

99.4

67.0

70.6

83.2

77.3

Tsu works

t

274.6

262.8

218.4

270.1

235.3

EN

t

1,494.3

1,616.2

1,368.5

1,761.1

4,168.2

EN Gr

%

94.0

96.3

96.7

97.0

95.8

EN

%

97.1

96.9

97.6

96.7

97.3

Yokohama
HO

%

98.7

98.5

98.7

98.5

98.8

Tsu works

%

91.5

88.9

89.0

85.2

85.2

%

39.1

53.4

45.3

46.8

68.0

Tsurumi
works

%

49.8

78.9

61.0

68.7

79.4

Tsu works

%

34.0

32.5

37.0

32.1

60.9

%

98.3

98.4

98.4

98.4

97.1

Landfill

OfficesEN
Productions
WastesConstructions
Recycle rate

OfficesEN
Productions

Constructions

EN*1 Data cover JFE Steel and 25 consolidated subsidiaries in Japan.
*2 Data cover JFE Engineering and 10 consolidated subsidiaries in Japan.
*3 Data from FY2019 includes wastes generated at offices and productions of JFE Engneering.

JFE GROUP CSR REPORT 2020

178

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyFY2015FY2016FY2017FY2018FY2019

Guideline
Indices■ Wastes at JFE Engineering Construction Sites
Items

RubbleSludgeIndustrial waste
excluding rubble
and sludge

Scope

Unit

Amountgenerated

ENt

60,37356,767

58,82478,410113,637

Landfill amount

EN

t

40

414

94

297

1,533

Recycle rate

EN

%

99.9

99.3

99.8

99.6

98.6

AmountgeneratedENt

11,84021,814

23,463

16,142

17,225Landfill amount

EN

t

53

98

849

199

205

Recycle rate

EN

%

99.5

99.5

96.3

98.8

98.8

AmountgeneratedENt

19,09623,231

5,853

14,494

14,535Landfill amount

EN

t

1,401

1,103

425

1,265

2,430

Recycle rate

EN

%

91.7

95.0

92.2

91.0

82.1

■ Paper Consumption at JFE Shoji
tems

Scope

Unit

FY2015FY2016FY2017FY2018FY2019

boxes

4,838

4,904

5,100

4,832

4,675

Tokyo

boxes

2,623

2,614

2,674

2,661

2,516

Osaka

boxes

610

545

527

372

399

Nagoya

boxes

212

305

308

217

293

Branch

boxes

1,393

1,440

1,591

1,582

1,467

SH
Consumption of copierpapers

Efficient Use of Natural Resources (Supplementary Data)■ Examples of Recycling and Processing at JFE Group (FY2019)
Content

Unit

Volumemilliontonnes0.10

Used directly in the iron and steelmaking
process

milliontonnes0.06

Collected as gas and used as fuelmilliontonnes0.05

Treating fluorescent tubes

milliontubes

20

Waste home appliances

million
units

0.50

Plastic containers and packaging bidding

Using waste plastics in the iron andsteelmaking process

JFE GROUP CSR REPORT 2020179

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ List of JFE Group's Recycling Businesses
Area
SapporoName of company, plant,
business establishment, etc.
Sapporo Bio Food Recycle
Corporation

Plant

Addresses

Food waste recycling plant45-53 Nakanuma-cho, Higashi-ku
Sapporo-shi, Hokkaido

Sendai plastic packaging-wastesorting and baling plant

1-6-1 Minato, Miyagino-ku Sendaishi, Miyagi

Plastic material recycling plantsame as above

Fluorescent tube recycling plantsame as above

Recycled pallet manufacturing
plant

same as above

Confidential documents disposal
plantsame as above

Rifu Plant

Refuse paper and plastic (RPF)
manufacturing plant

6-5-14 Shirakashidai, Rifu-cho
Miyagi-gun, Miyagi

JFE Bars & Shapes Corporation

Electric furnace recycle plant

J&T Recycling Corporation
Sendai Plant

Sendai

KashimaDirect current arc furnace

7 Minamihama, Kamisu-shi,
Ibaraki

Chiba Recycle Center

Waste gasifying and melting
furnace

1 Kawasaki-cho, Chuo-ku Chibashi, Chiba

Chiba Biogas Center

Food waste recycling plantsame as above

Fluidized bed gasification andmelting furnace (industrial)

Oumi 3-chome chisaki, Koto-ku,
TokyoVertical furnace (medical)

same as above

Ohgishima Plant

Waste plastic recycling plant

10 Ohgishima, Kawasaki-ku
Kawasaki-shi, Kanagawa

Kawasaki PET Bottle
Recycling Plant

Waste PET bottle recycling plant

5-1 Mizue-cho, Kawasaki-shi
Kawasaki-ku, Kanagawa

Kawasaki Eco Clean

Kiln-stoker incinerator

5-73 Ohgimachi, Kawasaki-ku
Kawasaki-shi, Kanagawa (andother locations)

Solid waste recycling plantsame as above

Mizue Recycling Plant

Waste plastic recycling plant699-23 Mizue-cho, Kawasaki-ku
Kawasaki-shi, Kanagawa (andother locations)

NF Board® manufacturing
plant

NF Board® manufacturing plant

5-1 Mizue-cho, Kawasaki-ku
Kawasaki-shi, Kanagawa

Consumer/office appliancerecycling plant

6-1 Mizue-cho, Kawasaki-ku
Kawasaki-shi, Kanagawa

J&T Recycling Corporation
Chiba

J&T Recycling Corporation
Tokyo

Tokyo Waterfront Eco Clean

J&T Recycling Corporation

Kawasaki

JFE Plastic Resource
Corporation

JFE Urban Recycle Corporation
Home Appliance Recyclingplant

JFE GROUP CSR REPORT 2020180

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Area

Name of company, plant,
business establishment, etc.

Plant

Addresses

J&T Recycling Corporation
Kiln-stoker incinerator

2-1-5 Suehiro-cho, Tsurumi-ku
Yokohama-shi, Kanagawa (andother locations)

Kiln-ash melting furnace

same as above

Liquid/sludge waste
intermediate-treatment plant

3-1 Benten-cho,Tsurumi-ku
Yokohama-shi, Kanagawa

Dry cell battery and battery
recycling plant

2-1-8 Suehiro-cho, Tsurumi-ku
Yokohama-shi, Kanagawa

Tsurumi Fluorescent Tube
Recycling Plant

Fluorescent tube recycling
plant

same as above

Yokohama Plastics Recycling
Plant

Yokohama City plastic
packaging-waste sorting andbaling plantsame as above

Kanazawa Recycling Plant

Solid waste recycling plant

1-14-5 Fukuura, Kanazawa-ku
Yokohama-shi, Kanagawa

Yokohama Plant

Food waste recycling plant

2-1-5 Suehiro-cho, Tsurumi-ku
Yokohama-shi, Kanagawa

Mizushima Eco-works Co., Ltd.

Waste gasifying and melting
furnace

1-14-5 Kawasaki-dori,
Mizushima, Kurashiki-shi,
OkayamaKurashiki Works

Waste wood carbonizing
facility

1-14-1 Kawasaki-dori,
Mizushima, Kurashiki-shi,
Okayama

JFE Bars & Shapes Corporation

Electric furnace recycling plant

Yokohama Eco Clean

Chemical Works

Yokohama

J Bio Food Recycle Co., Ltd.

JFE Environmental Service
Corporation Kurashiki Works
Kurashiki(Mizushima)

Direct current arc furnace

1-5-2 Kawasaki-dori,
Mizushima, Kurashiki-shi,
Okayama (and other locations)

Waste plastic recycling plant

113 Minoki-cho, Fukuyamashi, Hiroshima

Fukuyama RPF Plant

RPF manufacturing plant

115-1 Minoki-cho, Fukuyamashi, Hiroshima

Fukuyama PM Recycling Plant

Plastic material recycling plantsame as above

Fukuyama Palette Plant

Recycled pallet manufacturing
plant

same as above

Steel Works

Kiln incinerator

1 Kokan-cho, Fukuyama-shi,
HiroshimaControlled landfill

same as above

Liquid waste neutralization
plant

same as above

JFE Plastic Resource
Corporation
Fukuyama Recycling Plant
J&T Recycling Corporation

Fukuyama

JFE GROUP CSR REPORT 2020

181

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Name of company, plant,
business establishment, etc.

Area
Fukuyama

ToyamaPlant

Addresses

Fukuyama Recycle Electric
Generation Co., Ltd.

Refuse-derived fuel (RDF)
gasifying power generation
plant (commissioned
operation)

107-8 Minoki-cho, Fukuyamashi, Hiroshima

JFE Material Co., Ltd.

Rare metal recovery plant for
spent catalysts

2-9-38 Shosei-machi, Imizushi, Toyama

Water Security■ Water
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019milliontonnes

-

-

241

240

242

ST Gr

milliontonnes

229

237

241

238

241

ST

milliontonnes

203

212

220

218

221

ST
subsidiaries

milliontonnes

26.4

24.9

20.6

20.5

19.8

EN Gr

thousandtonnes

-

-

832

918

1,410

EN

thousandtonnes

95

94

97

102

106

EN
subsidiaries

thousandtonnes

-

-

735

816

1,304

SH Gr

thousandtonnes

247

140

166

165

149

SH

thousandtonnes

-

-

-

-

-

SH
subsidiaries

thousandtonnes

247

140

166

165

149

ST Gr

milliontonnes

-

-

146

144

143

ST

milliontonnes

128

126

128

126

126

ST subsidiaries

milliontonnes

-

-

17.8

18.0

17.0

thousandtonnes

165

148

140

146

126

All

Amount of water
accepted*1

Amount of water
released*2

EN

JFE GROUP CSR REPORT 2020

182

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019ST Gr

milliontonnes

-

3,679

3,690

3,665

3,616

ST

milliontonnes

3,326

3,340

3,410

3,376

3,323

ST subsidiaries

milliontonnes

-

339

280

289

293

Amount of water
consumption*2

Amount evaporated

ST

milliontonnes

75

86

92

92

95

Ratio of amountreleased andevaporated

ST

%

6.3

6.3

6.5

6.5

6.6

ST Gr

milliontonnes

-

3,442

3,449

3,427

3,375

ST

milliontonnes

3,123

3,128

3,190

3,158

3,102

ST subsidiaries

milliontonnes

-

314

259

269

273

Amount recycled*2

Recycling rate*2*3

ST

%

93.9

93.7

93.5

93.5

93.4

ST subsidiaries

%

-

91

93

93

93

*1 Coverage:
・ JFE Steel and 25 consolidated subsidiaries in Japan.
・JFE Engineering and 7 consolidated subsidiaries in Japan.
・ 33 JFE Shoji domestic and overseas consolidated subsidiaries.
*2 25 JFE Steel consolidated subsidiaries in Japan.
*3 Industrial water circulated (%) = (Total amount − industrial water accepted)/total amount used × 100

JFE GROUP CSR REPORT 2020

183

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Water Related Data by Water Intake Source and Discharge Source
Items

Scope

Unit

FY2017FY2018FY2019milliontonnes

219.6

218.3

220.9

River/lake

milliontonnes000Groundwater

milliontonnes000milliontonnes

219.6

218.3

220.9

Ocean

milliontonnes000

Rainwater

milliontonnes000Other intake source

milliontonnes000

Total amount released

milliontonnes

128.8

126.0

126.6

Ocean

milliontonnes

128.3

125.6

126.2

Surface water

milliontonnes000milliontonnes000Off-site water processing

milliontonnes

0.4

0.4

0.5

Beneficial use/other use

milliontonnes000Other discharge source

milliontonnes000

Total amount acceptedIndustrial
water/waterworks

Underground/well

All*1

All*1

*1 Data cover JFE Steel and JFE Engneering.

JFE GROUP CSR REPORT 2020

184

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Water Security (Supplementary Data)■ Amount of Water Accepted and Released at JFE Steel Group Subsidiaries (FY2019)
Company nameAmount accepted(unit:tonnes)

Amount released(unit:tonnes)

JFE MINERAL COMPANY, LTD.

2,357,033

2,332,290

JFE ROCKFIBER CORPORATION

52,92652,926

Mizushima Ferroalloy Co., Ltd.

431,617

15,0653,860,186

3,860,186

CHIBA RIVERMENT AND CEMENT CORP.

6,977

6,977

MIZUSHIMA RIVERMENT CORP.

17,001

17,001

JFE PRECISION CORPORATION

575,747

575,747

JFE Plastic Resource Corporation

17,355

13,744JFE Bars & Shapes Corporation

4,875,906

2,964,831

JFE Metal Products & Engineering Inc.

101,075

136,362

JFE KENZAI FENCE CO., LTD.

68,532

68,532

1,029,897

870,286

JFE Container Co., Ltd.

297,120

297,120

JFE Welded Pipe Manufacturing Co., Ltd.

64,47564,475

JFE Steel Pipe Co., Ltd.

1,463

1,463

Galvatex Corporation

699,911

699,911

JFE Pipe Fitting Mfg. Co., Ltd.

4,246

35,329JFE Techno-wire Corporation

89,53589,535

JFE Kozai Corporation

14,87914,879GECOSS CORPORATION

63,00563,221

JFE LOGISTICS CORPORATION

117,257

117,257

J-Logitec Co., Ltd.

3,217

3,217

JFE Chemical Corp.

4,488,973

4,210,610

K-PLASHEET CORPORATION

35,416

11,142

JFE LIFE CORPORATION

492,413

470,335

19,766,162

16,992,441

JFE GROUP CSR REPORT 2020

185

JFE Material Co., Ltd.

JFE Galvanizing & Coating Co., Ltd.

Total

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices■ Amount of Water Accepted at JFE Engineering Group Subsidiaries (FY2019)
Company nameAmount accepted (unit: thousand tonnes)

J&T Recycling Corporation

1,216

JFE Environmental Service Corporation

0.03

NORTHERN JAPAN MACHINERY Corporation

0.003

Tohoku Dock Ironworks Corporation

57.3

JFE Aqua Machine and Service Corporation

0.002

Fujikako, Inc.

0.02

J Farm Corporation

30.6

Total

1,304

JFE GROUP CSR REPORT 2020

186

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices

Social Data
Customer Responsibility■ Customer Training (FY2019)
Name of training

Scope

Unit

Participants

Technical presentation by overseas Group companies(number of participating companies*)

JFE Shoji

People(companies)

National staff training

JFE Shoji

People33 (15)24* Data covers 9 countries for the number of participating companies.

Occupational Health and Safety■ Lost-work Injuries and Accidents
Items
Lost-work
injuries*2

Scope

FY2015FY2016FY2017FY2018FY2019

-

0.15

0.21

0.17

0.17

0.28

-

0.16

0.15

0.15

0.15

0.30

JFE
Engineering*1

-

0.28

0.19

0.71

0.82

0.45

-

0.01

0.30

0.02

0.02

0.62

JFE ShojiGroup*1

-

0.67

1.16

1.22

0.60

1.00

-

1.02

0.41

0.97

0.04

0.02

Manufacturingindustry average

-

1.06

1.15

1.02

1.20

1.20

-

0.06

0.07

0.08

0.10

0.10

Cases

-

35

42

41

49

Cases

-

3

3

2

6

Cases

-

22

18

18

30

Cases

-

2

2

2

4

Cases

-

4

14

18

11

Cases

-

1

0

0

2

Cases

-

9

10

5

8

Cases

-

0

1

0

0

JFE Steel*1

Severity*3

Lost-work
Injuries andSeverity(Rates)Lost-work
injuries*2
Severity*3
Lost-work
injuries*2
Severity*3
Lost-work
injuries*2
Severity*3
Lost-work injuries
Fatal injuries
Lost-work injuries

Number of
lost-work
injuries

Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries

JFE Group
JFE Steel
JFE Engineering
JFE Shoji GroupUnit

JFE GROUP CSR REPORT 2020187

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Items

Scope

Lost-work injuries
Fatal injuries
Lost-work injuries
Lost-work
Injuries Involving
Employees

Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries

Lost-work
injuries involving
employees ofcontractors

Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries
Lost-work injuries
Fatal injuries

JFE Group
JFE SteelJFE
Engineering
JFE ShojiGroup
JFE Group
JFE SteelJFE
Engineering
JFE Shoji
Group

Unit

FY2015FY2016FY2017FY2018FY2019

Cases

-

14

13

13

18

Cases

-

1

2

1

1

Cases

-

6

4

7

10

Cases

-

1

1

1

1

Cases

-

0

0

1

2

Cases

-

0

0

0

0

Cases

-

8

9

5

6

Cases

-

0

1

0

0

Cases

-

21

29

28

31

Cases

-

2

1

1

5

Cases

-

16

14

11

20

Cases

-

1

1

1

3

Cases

-

4

14

17

9

Cases

-

1

0

0

2

Cases

-

1

1

0

2

Cases

-

0

0

0

0

*1 Scope of data:
・JFE Steel and JFE Engineering: parent company, business associates and contractors in Japan
・JFE Shoji : parent and consolidated subsidiaries, business associates and contractors in Japan*2 Lost-work injuries (rate) = number of employees with lost-work injuries/total working hours × 1,000,000*3 Severity = number of lost working days/total working hours × 1,000■ Health and Safety Training (2019)
Items

Unit

Participants*

Training for chief of construction site (responsible for controlling health andsafety matters)

People577

Mental healthcare education for new hires and at rank-based training

People198* Total of 3 operating companies.

■ Employee Health Data
Items

Scope

Unit

FY2015FY2016FY2017FY2018FY2019Metabolic syndrome
rates

Insured by the JFEGroup's health insurance
union (age 40 and above)

%

35.2

35.4

35.9

36.0

35.6

%

33.7

33.2

32.6

31.7

31.1

Age 40 and above

%

40.8

42.1

43.7

48.2

51.4

Smoking rates
Rate of healthexamination for
dependents

JFE GROUP CSR REPORT 2020

188

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialExternal
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Governance

ESG Data

Unit

FY2015FY2016FY2017FY2018FY2019JFE Steel

%

15.9

17.8

36.8

56.9

56.9

JFE Engineering

%

7.3

12.9

22.7

22.1

28.9

JFE Shoji

%

38.1

21.9

25.0

45.2

36.8

JFE Steel

%

45.9

45.7

46.0

52.3

48.2

JFE Engineering

%

47.4

46.4

47.3

54.2

51.7

JFE Shoji

%

50.0

53.5

55.1

52.4

51.0

■ Health Data for Employees and Their Family
Items

Scope

Provision rate ofhealth guidanceRate of healthexamination for
dependents** Scope: dependents (including spouses and others) age 40 and above

Labor Practice■ Employee Data (2019)category

Consolitaded/
non-consolitaded

Unit

JFE
Engineering

JFE SteelJFE Shojipeople45,844

10,265

7,855

Male

people40,215

8,851

5,707

Femalepeople

5,629

1,414

2,148

people11,549

3,387

1,709

people10,899

3,224

1,480

people

650

163

229

%

5.6

4.8

13.4

people15,998

3,841

987

Male

people14,6363,307

603

Femalepeople

1,362

534

384

people

2,800

2,348

630

people

2,650

2,216

591

people

150

132

39

%

5.4

5.6

6.2

people

1,022

143

83

Male

people

935

132

53

Femalepeople87

1130

New graduatespeople

795

79

70

Mid-career

people

227

64

13

Employees

Management positions
Male

Conslidated*1

FemaleRatio of women in
management
positions
Employees

Management positions
Male
FemaleRatio of women in
management
positions
Recruits

Non-consloitaded*2

JFE GROUP CSR REPORT 2020

189

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
Consolitaded/
non-consolitaded

category
Years of continuous
employment (average)

Unit

JFE
Engineering

JFE SteelJFE Shoji

year

15.9

13.8

13.9

Male

year

15.8

13.8

14.3

Female

year

17.9

13.8

12.9

Job turnover rate*4

%

2.5

1.5

2.9

Rehired employees

people

824

48

32

%

5.2

1.2

3.2

Average annual leave taken

day/year

17.0

18.7

12.7

Average overtime

hours/
month

27.4

27.6

26.8

Employees working shorter
hours for childcare(aggregated)people

129

79

21

Temporary staffs

people

214

732

16

Ratio of rehired employees

Non-consloitaded*2*1 Consolidated subsidiaries (JFE Steel: 148, JFE Engineering: 55, JFE Shoji: 87)*2 As of April 1, 2020. Other figures are as of FY2019.
*3 Management positions at JFE Engineering and JFE Shoji include employees on loan.
*4 Job turnover rate: percentage of employees who voluntarily choose to resign from the organization.

■ Recruiting (FY2020)
Career-track Positions
category

Unit

White
-collarTechnical

On-site andClericalPositions

Total

Total

Male

people

120

297

417

703

1,120

Femalepeople

37

21

58

70

128

Total

people

157

318

475

773

1,248

%

23.6

6.6

12.2

9.1

10.3

Ratio of women (%)■ Employment of People with Disabilities (as of June 1 of each year)
Category
Employment ofPeople with
Disabilities

Scope

Unit

2016

2017

2018

2019

2020

JFE Steel

%

2.24

2.34

2.33

2.41

2.48

JFE Engineering

%

1.59

2.01

2.14

2.39

2.23

JFE Shoji

%

2.11

1.86

2.20

2.62

2.50

JFE GROUP CSR REPORT 2020

190

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices

Community■ Social Contributions (FY2019)
Activities

Scope

Unit

JFE Group
Internships

PeopleApproximately 2010

JFE SteelPeopleApproximately 460

JFE Engineering

PeopleApproximately 910

JFE Shoji

PeopleApproximately 640

Desks andchairsSupporting elementary
schools in Ghana and Nigeria

Notebooks

Achievements

JFE Shoji

Canned
foods

Sets

700

Books

17,000Cans

12,500■ JFE 21st Century Foundation (FY2019)
Grants

Projects

Technology research (accumulated)

Value (million yen)632

1,271.8

Iron and steel technology research

1224

Global environment and global warming
prevention technology research

13

26

Asian history studies (accumulated)

130

195

Asian history studies for FY201910

15

Technology research
for FY2019

Activities

Sets donatedSupporting the Japan Overseas Educational Services Writing Contest andanthology donation (to elementary and middle schools and also public
libraries in the regions related to steel*)

2,400* Donated to 671 elementary and middle schools and 73 public libraries.

Shareholders and Investors■ Major IR Activities (FY2019)※ 寄贈先：小・中学校671校、73図書館
Major communication methods, etc.

Number of sessions

participation (people)

5

Approx. 500

As needed

Approx. 400

11

Approx. 800

Investors meeting
Individual interviews with institutional investors and securities
analysts
Briefings for Individual investor (at the branch offices of
securities firms, etc.)■ Plant Tours and Company Briefing Sessions (FY2019)
Activities
Plant tours and company briefing
sessions

Scope
JFE Steel JFE Engineering Japan
Marine United

Number ofsessions
23

Participants
Approximately
1,800

JFE GROUP CSR REPORT 2020

191

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Governance Data
Corporate Governance■ Corporate Governance System

As of July 1, 2020

Items

Overview of the system

Organizational design typeCompany with an Audit & Supervisory Board

Number of Directors (members)

8

The number of Independent Outside Directors (members)

3

The number of female Directors (member)

1

Number of Audit & Supervisory Board Members (members)

5

The number of Independent Outside Audit & Supervisory
Board Members (members)

3

The number of femal Audit & Supervisory Board Members(members)

1

Term for Directors (years)

1

Term for Outside Directors (years)

1

Corporate Officer System

AdoptedVoluntary advisory committees of the Board of Directors

Nomination Committee and Remuneration
Committee■ Directors and Audit & Supervisory Board members

Position

Director

As of July 1, 2020
Number ofmeetings of
the Audit&
Supervisory
Board
attendedin FY2019

Significant
concurrent post

Independent
executive

Number ofmeetings ofthe Board of
Directors
attendedin FY2019

Koji Kakigi

Chairman of the Boardof Directors of JFE
21st Century
Foundation(Public Interest
Incorporated
Foundation)-

14/14(100%)-

Yoshihisa Kitano

Representative
Director, President
and CEO of JFE SteelCorporation-

11/11(100%)

-

Name

InsideJFE GROUP CSR REPORT 2020

192

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

Position

Significant
concurrent post

Independent
executive

Masashi Terahata

Director of JFE SteelCorporation,
Representative
Director of JFE 21stCentury Foundation(Public Interest
Incorporated
Foundation)-

11/11(100%)-

Naosuke Oda

Representative
Director, President
and CEO of JFE Shoji
Corporation-

14/14(100%)-

Hajime Oshita

Representative
Director, President
and CEO of JFE
Engineering
Corporation-

14/14(100%)-

Masami Yamamoto

Director and Senior
Advisor of Fujitsu
Limited,Outside Director ofMizuho Financial
Group, Inc.

〇

14/14(100%)-

Nobumasa Kemori

Executive Advisor of
Sumitomo Metal
Mining Co., Ltd.,
Outside Director of
NAGASE & CO., LTD.,
Outside Director of
Sumitomo Realty &Development Co., Ltd.

〇

14/14(100%)-

Yoshiko Ando

Audit & Supervisory
Board Member of Kirin
Holding Company,
Limited, Outside
Director of Sansei
Technologies, Inc.

〇

-

-

Name

InsideDirector

OutsideNumber ofmeetings of
the Audit&
Supervisory
Board
attendedin FY2019

Number ofmeetings ofthe Board of
Directors
attendedin FY2019

JFE GROUP CSR REPORT 2020

193

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

Position

Significant
concurrent post

Independent
executive

Nobuya Hara

Audit & Supervisory
Board Member of JFE
Steel Corporation-

14/14(100%)

20/20(100%)

Kumiko Baba

Audit & Supervisory
Board Member of JFE
Engineering
Corporation,
Audit & Supervisory
Board Member of JFE
Shoji Corporation-

11/11(100%)

13/13(100%)

Shigeo Oyhagi

Advisor of Teijin
Limited,Outside Director ofKDDI CORPORATION,
Outside Director of
MUFG Bank, Ltd
Outside Director ofTokyo Electric Power
Company Holdings, Inc.

〇

14/14(100%)

20/20(100%)

Isao Saiki

Partner Lawyer of Abe,
Ikubo & Katayama Law
Firm〇

14/14(100%)

20/20(100%)

Tsuyoshi Numagami

Professor, Graduate
School of Business
Administration,
Department of
Business
Administration of
HITOTSUBASHI
UNIVERSITY〇

14/14(100%)

20/20(100%)

Name

InsideAudit &
Supervisory
Board
MemberOutsideNumber ofmeetings of
the Audit&
Supervisory
Board
attendedin FY2019

Number ofmeetings ofthe Board of
Directors
attendedin FY2019

Note:• The number of meetings of the Board of Directors held during FY2019 differ for Mr. Yoshihisa Kitano and
Mr. Masashi Terahata, as they were newly elected as directors at the previous year's Ordinary General Meetingof Shareholders (held on June 21, 2019).
• The number of meetings of the Board of Directors and Audit & Supervisory Board held during FY2019 differ for
Ms. Kumiko Baba, as she was newly elected as an Audit & Supervisory Board member at the previous year’s
Ordinary General Meeting of Shareholders (held on June 21, 2019).

JFE GROUP CSR REPORT 2020

194

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyAs of July 1, 2020

■ Nomination Committee and Remuneration Committee
Items

Members

Nomination Committee

6

Inside Director

2

Outside Director

2

Outside Audit & Supervisory Board Member

2

Remuneration Committee

6

Inside Director

2

Outside Director

2

Outside Audit & Supervisory Board Member

2

Guideline
IndicesNumber of meetings
held during FY2019

Chairperson

Masami Yamamoto(Outside Director)

6

Nobumasa Kemori(Outside Director)

3■ Operating System
Committee

Company

Chairperson

Attendees

Group Management
Strategy Committee

JFE Holdings

President

Inside Directors (including 3 operating company
Presidents), Corporate Officers and full-time
Audit & Supervisory Board Members

JFE Holdings

President

Inside Directors (excluding 3 operating company
Presidents), Corporate Officers and full-time
Audit & Supervisory Board Members

Each operatingcompany

President

Directors, major Corporate Officers and Audit &Supervisory Board Members

Management Committee■ Executive Remuneration

FY2019

Executive remuneration
Total remuneration, etc.
(thousand yen)

Number of Executives(members)

Directors (excluding Outside Directors)

267,653

7

Audit & Supervisory Board Members (excluding Outside
Audit & Supervisory Board Members)

78,296

3

Outside Directors/ Audit & Supervisory Board Members

86,535

6

Position

Officers whose consolidated remuneration exceeded 100 million yen
Per company(thousand yen)

Position

Koji Kakigi

Director

JFE Holdings

127,181

Director

JFE Holdings

9,000

Director

JFE Steel

Yoshihisa Kitano

Company

Total(thousand yen)Name

127,181
126,340

117,340

Ratio of remuneration for each
Basic remuneration:
fixed (%)

Annual bonus:
linked to short-term performance(%)

Stock remuneration:linked to medium- tolong-term performance (%)

60

20

20
JFE GROUP CSR REPORT 2020

195

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards■ Internal Control System

Editorial
PolicyGuideline
Indices

As of April 1, 2020

Internal control system
Number of companies(companies)

Number of people
assigned(members)

Internal audit organizationー

164

Full-time Audit &Supervisory Board Members

28

34

Dispatched Audit &Supervisory Board Members(part-time Audit &Supervisory Board member)

30

11

Items
Internal audit

Audit & Supervisory Board

Cooperation of Audit & Supervisory Board members
Items

Number of meeting held during FY2019

Accounting auditor

8

Internal Audit Department

6Compliance（including Anti-corruption）■ Whistleblowing
Items

Scope

Unit

FY2017FY2018FY2019Cases handled by the
Corporate Ethics Hotline

JFE Holdings and operatingcompanies

Cases

89

80

101

JFE GROUP CSR REPORT 2020196

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Independent Assurance Statement

JFE GROUP CSR REPORT 2020

197

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

External ESG Evaluations
Constituent of the FTSE4Good Index Series and FTSE Blossom Japan Index
In July 2020, JFE Holdings was chosen as a constituent of
the FTSE4Good Index Series and FTSE Blossom Japan
Index, investment indexes developed by FTSE Russell, asubsidiary of the London Stock Exchange Group. The
FTSE4Good Index Series selects companies that
demonstrate strong environmental, social, and governance(ESG) practices. It is widely used in the creation orassessment of sustainable investment funds or otherfinancial products. The FTSE Blossom Japan Index is anindex designed to reflect the performance of Japanesecompanies that demonstrate strong ESG practices. It is an
ESG investment index adopted by the GPIF.

Evaluation by CDP 2019
Established in Britain in 2000, the Carbon Disclosure Project (CDP) is a nongovernmental organizationthat conducts ESG evaluations. It calls on companies to disclose ESG-related information by
responding to CDP questionnaires to facilitate the ESG investment decisions of institutional investors.
Currently, the CDP covers three environmental areas: climate change, water security, and forests, andcompanies are rated on an eight-point scale for each area. The volume of information collected by the
CDP has become one of the largest in the world, with currently over 300 companies responding to thequestionnaires, which are widely used in various indexes by institutional investors and for socially
responsible investment.
The JFE Group responds to climate change and water security questionnaires every year. We madesure to disclose appropriate information for the CDP 2019 questionnaire, and as a result we received ahigh rating.
CDP 2019 score: climate change: B, water security: A-, supplier engagement: A-

DBJ Environmentally Rated Loan Program
The Development Bank of Japan (DBJ) Environmentally Rated
Loan Program uses a screening (rating) system developed by DBJ
to evaluate environmental management and then assign acorresponding interest rate from three levels. This was theworld’s first loan program to incorporate environmental ratings in
its financing menus. In March 2016, JFE Holdings was rated as a
top-ranking company that pursues excellent and advanced
environmental initiatives resulting in outstanding environmentalmanagement performance, based on which the company secured
a loan under the program.

JFE GROUP CSR REPORT 2020

198

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

SOMPO Sustainability Index
JFE Holdings has been chosen for eight consecutive
years as a constituent of the SOMPO Sustainability
Index (former: SNAM Sustainability Index), which waslaunched by Sompo Asset Management Co., Ltd. The
index, which encompasses companies with highly
evaluated ESG ratings, contributes to investor asset
formation by evaluating corporate value from a longterm perspective.

DBJ Employees’ Health Management Rated Loan Program
The DBJ Employees’ Health Management Rated Loan
Program is the world’s first financing menu that bases loan
conditions on DBJ’s proprietary system for rating healthmanagement for the purpose of selecting and evaluatingcompanies based on their performance in this area.
JFE Holdings’ efforts in pursuing employee healthmanagement has been highly regarded, and it is rated as a
top-ranking company under the program.

Caterpillar Quality Assurance Certification
In 2020, JFE Steel West Japan Work (Kurashiki District)and JFE Shoji were named for four consecutive years asGold Level SQEP suppliers for the Supplier Quality
Excellence Process, a quality certification of the U.S.based construction equipment manufacturer Caterpillar
Inc. The program ranks suppliers for compliance with
ISO 9001 standards and Caterpillar’s own specifications
and certifies the top firms as Platinum, Gold, Silver, orBronze. Only a few companies in Japan have received
Gold Level certification, and JFE Steel is the world’s
first blast furnace company to be certified.
Receiving the Gold certification plaque

JFE GROUP CSR REPORT 2020

199

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Non-ESG External Evaluation
Digital Transformation Stocks 2020
JFE Holdings was selected as one of the Digital Transformation
Stocks (DX Stocks) 2020 by the Ministry of Economy, Trade andIndustry (METI) and the Tokyo Stock Exchange (TSE) in recognitionof its active promotion of digital transformation. For each of theprevious five years, METI and TSE had selected the company as aCompetitive IT Strategy Company Stock because of its strategic IT
investments to increase medium- to long-term corporate value andbolster competitiveness. With this stock selection renamed to DX
Stocks to reflect its current focus on digital transformation for new
corporate growth, the company has essentially been recognized for
its efforts in this area for six consecutive years.

JFE GROUP CSR REPORT 2020

200

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

External Awards
Excellence Award of the 23rd Environmental Communication Awards
JFE Group CSR REPORT 2019, issued in September 2019, won
the Excellence Award of the 23rd Environmental Communication
Awards, hosted jointly by the Ministry of the Environment andGlobal Environmental Forum. This marks the first recognition for
the JFE Group.
Environmental Communication Awards recognize outstanding
environmental reports targeting multi-stakeholders with the goalof promoting environmental communication between parties
involved in the business and to further invigorate environmental
initiatives among various media, such as CSR reports, integrated
reports, and environmental management reports. For the 23rd
awards, 180 reports were submitted for judgement under theenvironmental report category and 118 reports under theenvironmental management report category. The JFE Group wasrecognized as one of 25 excellent reports under the environmental
reporting category. The award ceremony was held on Wednesday,
February 19, 2020 at Shinagawa Prince Hotel.。
Please see the following for further details.
JJFE Group CSR REPORT 2019 receives Excellence Award of the 23rd Environmental Communication
Awards (Japanese only)(https://www.jfe-holdings.co.jp/release/2020/02/200220.html)

JFE-METS Receives Grand Prize of the Minister of Economy, Trade and Industry for the 2019
Energy Conservation Grand Prize Award
Multi-site integrated energy network services, offered by JFE Engineering under the service brand JFEMETS, received the Grand Prize of the Minister of Economy, Trade and Industry under the Product andBusiness Model Category of the 2019 Energy Conservation Grand Prize Award, the highest-ranking
award in this category. Instead of applying the conventional method for optimizing energy by site, JFEMETS offers an energy optimization service for collectively managing multiple sites by business unit,
area, or other entity. The service enables comprehensive energy saving through the interchange ofelectricity within a business including remote sites. JFE Engineering takes responsibility for analyzingeach customer's actual energy consumption and implementing and operating relevant equipment at
each site to achieve overall optimization.
Please see the following for further details.
JFE-METS is awarded Grand Prize of the Minister of Economy, Trade and Industry for the 2019
Energy Conservation Grand Prize Award for realizing energy saving through collective energy
management of multiple sites (Japanese only) (https://www.jfe-eng.co.jp/news/2020/20200130.html)

JFE GROUP CSR REPORT 2020

201

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

External Awards for Research and Development■ Awards for Technologies and Product Developments (FY2019)

JFE SteelJFE
Engineering

Prize/Award

Project

Sponsor

The Commendation for Scienceand Technology by the Minister of
Education, Culture, Sports,
Science and Technology (Prizes
for Science and Technology,
Development Category)

Development of high-strength,
high-workability thin steel sheets
using innovative micro system
control technology

Ministry of Education,
Culture, Sports,
Science andTechnology

Japan Society for the Promotionof Machine Industry President's
Award (Machine Promotion
Award)Development of the world's
fastest temper millJapan Society for the
Promotion of Machine
Industry

Okochi Memorial Prize

Development of assembled organ
control-type brittle crack
propagation arrest thick steel
plate

Okochi Memorial
Foundation

Prize of the Chairman of ECCJ for
Energy Conservation Best
Practices at Workplaces, Energy
Conservation Grand Prize Award

Energy saving by reducing heatloss during the use of molten irontransport container at steelworks

The Energy
Conservation Center,
Japan

Prime Minister's Prize for
Monozukuri Nippon Grand Award

Development of resource saving Si
gradient magnetic material
contributing to energy saving ofelectronic devices

Ministry of Economy,
Trade and Industry

Japan Institute of Invention andInnovation Chairperson's Award(National Commendation forInvention)

Invention of a magnetic steel
sheet that facilitates
miniaturization and higher
efficiency electronic devices

Japan Institute ofInvention andInnovation

Derwent Top 100 Global
Innovators 2018-19

JFE Steel's activities forintellectual properties

Clarivate Analytics

Grand Prize of Minister of
Economy, Trade and Industry for
Energy Conservation Grand PrizeAwardJ-METS: multiple-site integrated
energy network service

The Energy
Conservation Center,
Japan

Progress Award (Technology)

Establishment of boiler corrosion
countermeasure technology andincreased power generation atwaste incineration facilities

The Japan Institute ofEnergyPrize of Director-General,
Industrial Science andTechnology Policy andEnvironment Bureau, METI, for
Excellent Environmental
Equipment Award

Fully automatic general waste
incineration equipment using AI
and data analysis technology

The Japan Society ofIndustrial Machinery
Manufacturers

JFE GROUP CSR REPORT 2020202

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyJapan Society for the Promotion of
Machine Industry President's Award(Machine Promotion Award)

Okochi Memorial Prize

Monozukuri Nippon Grand Award(Prime Minister's Prize)

The Commendation for Science andTechnology by the Minister of
Education, Culture, Sports, Scienceand Technology(Prizes for Science and Technology,
Development Category)

JFE GROUP CSR REPORT 2020

Guideline
Indices203

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesThird-party Comments

Yoshinao Kozuma

Emeritus Professor
Sophia University

1. Long-term Vision and Targets
Your most creative and astonishing achievement this year is the disclosure of a long-term target for reducing
CO2 emissions. Your goals to work toward being carbon neutral within the JFE Group as soon as possible after
2050 and reduce CO2 emissions in fiscal 2030 by 20% or more compared to fiscal 2013 in the steel business isan innovative commitment akin to one of the most advanced long-term targets in the global steel industry set
up by ArcelorMittal. These are by far the most ambitious targets, unrivaled by any other Asian steel
companies. Moreover, the targets were referred to in the Group's long-term vision: to demonstrate twoqualities of sustainability-economic sustainability and environmental and social sustainability-and become aresilient enterprise capable of consistently delivering value over the long term. This is the first time the JFEGroup has made any definitive statements on its long-term vision, demonstrating its management style ofearnestly adapting to a sustainable society by clearly defining its long-term vision and targets.

2. Measures Regarding Gender Inequality
With regard to measures for addressing gender inequality, I should particularly mention JFE Holdings’
achievement in appointing a female director in 2020, following the appointment of a female Audit &Supervisory Board member in 2019. As for the number of female managers, the group of employees expected
to shore up the number of female executives in the future, JFE has updated its target to achieve a fivefold
increase by 2025 compared to August 2014, since the previous goal of tripling the figure by 2020 had alreadybeen achieved in April 2019. It is said there is a significant correlation between appointment of female
executives, a long-term concern for Japanese companies, and improvement in business performance. I feelthat the JFE Group's steadfast efforts are gradually coming to fruition, and I have great expectations for future
developments.

3. Quantifying KPIs
The Group has made solid progress in addressing the issue of quantifying KPIs as it reviewed some of the
KPIs this fiscal year. In order to prepare for evaluating the achievement of initiatives, the Group also
quantified evaluation standards, further improving the transparency of its information disclosure. For a major
corporation made up of different groups of companies, I imagine it required significant courage to undertake
this internal alignment to establish and publicly declare quantitative evaluation standards applicable to theactivities of the organization. I believe the JFE Group's actions to take on this formidable task demonstrates
its strong commitment to becoming a sustainably growing corporate enterprise.

4. Future Challenges
Disclosure of this report on your website will allow the accumulation of a vast amount of information in cyber
space while also giving rise to the need for time and technique to search for necessary data. I advise you tomake your website more user-friendly by creating links between different reports and reorganizing thestructure of the site. Furthermore, the Group will need to create an effective internal system to adapt to therising expectations across the world for compliance with human rights and environmental due diligence.
JFE GROUP CSR REPORT 2020

204

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesMariko Kawaguchi

Specially appointed professor of
Graduate School of Social Design Studies,
Rikkyo University

This is my fourth year to offer comments on the JFE Group's report. These reports have given me theopportunity to observe the deepening of the Group's environmental strategy over time. In the context of all
four reports, the creation of a TCFD scenario, presented in last year's edition, was an example of anadvanced initiative by a Japanese corporation. While this year public concern has been focused on COVID19, the Group has made a leap forward in its climate change initiative by establishing long-term targets,
including reducing its CO2 emissions by 20% by 2030 and being carbon neutral by 2050. Since blast
furnaces use coal as a raw material and not for fuel, the complete phase-out of coal is virtually impossible
without assuming a revolutionary innovation in the production process and a bold business conversion
strategy. I respect this dramatic managerial decision. I also believe that management could not have cometo this determination if the TCFD scenario established last year had not laid out a road map for managing
decarbonization.
The seven key factors under 2℃ and 4℃ scenarios (decarbonization of iron and steelmaking process,increased needs for effective utilization of steel scrap, change in demand for automotive steel, etc., increasein demand for solutions to promote decarbonization, unstable raw materials procurement due to increased
occurrence of climatic hazards, damage to production bases and offices caused by climatic hazards, andnational resilience) identified in "JFE Group's Response to the TCFD" in this year's report indicate
management's recognition of the Group's medium- to long-term risks and opportunities. These risks
confront the global environment, industries, and society in a time of climate crisis and will serve as useful
information to other entities. How will management be able to steer business operations, presuming that allthese risks are indeed a matter of concern for many stakeholders? Furthermore, a road map for reducing
CO2 emissions and being carbon neutral provides convincing evidence for the bold decarbonization strategy
mentioned above. The reports for coming years could become even more persuasive by emphasizing thatthe long-term strategy was based on the TCFD scenario.
While society calls for a green recovery as the COVID-19 crisis moves to the center of public concern, theclimate crisis has certainly been exacerbated worldwide. The impact of natural disasters associated withhurricanes and typhoons of a massive scale, bushfires, and other events has intensified at an accelerating
pace. I would hope the next report will upgrade your scenarios from 2℃ and 4℃ to 1.5℃. In this case, I feel
you will need to shift toward strengthening resilience and actions for adapting to extraordinary weather
events in addition to reinforcing your mitigation initiatives to be carbon neutral. Also, more specific actions
are required for risks that are described in relatively abstract terms under the current 4℃ scenario.
On the other hand, constructing resilient buildings and developing urban infrastructure can also be seen as
an opportunity for the steel business. This year's report introduces various technologies and products
applied to the Group's eco-friendly processes and products. However, it creates the impression of being atechnology catalogue. Organizing this information by strategy to emphasize its relationship to corporate
value could be more effective.

JFE GROUP CSR REPORT 2020

205

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）This year's report discloses at the outset social issues, risks, and opportunities within the value chain of the
JFE Group as a whole and by business division. This is useful for understanding the Group's entire business.
Especially for climate-related risks, the report clearly conveys the pressing worksite situation calling forurgent action in terms of both mitigation and adaptation. In contrast, the themes of social challenges,
human rights, and workstyle felt like a list of keywords and lacked intensity. The importance of human rights
issues is increasing across the supply chain, including the mining sites for iron ore and coal and marinetransportation for these resources. In a recent marine accident, the crew is said to have steered a Japanesecargo ship off course to pick up a Wi-Fi signal, resulting in the ship running aground off Mauritius. I view
this incident as demonstrating the importance of respecting human rights during long voyages. And I believethat respecting the human rights of workers at mines, the crew members of vessels, and harbor workers will
emerge as an issue requiring increased attention from management.
Speaking of these issues as they relate to workers, I know you are doing what you can for female
advancement in the Group, notwithstanding the fact that women represent only a small proportion of its
employees. Unfortunately, I must say that you are still far behind the rest of the world in this matter.
Promoting the gender diversity of the board is not for the sake of supporting women; it increases corporate
value by broadening the understanding of management risks and opportunities. I expect to see further
efforts regarding this matter. To some extent, the fact that the ratio of female employees remains low due tothe characteristics of the industry is a challenge. It may be more practical to increase the ratio of female
employees at the stage of hiring while also establishing a target to maintain that ratio through their careerdevelopment from junior management to senior management and ultimately to executive officer. As a global
entity, I also expect greater diversity in the nationality of Board of Directors members.
Finally, I would like to point out that the report explains the value of steel, industry trends, and eco-friendly
technologies and can serve as a textbook for environmental action by the steel industry. One area for
improvement would be to make it easier for readers to distinguish whether the activity is attributable to theindustry as a whole or the company. One way to deal with this would be to separately present information
regarding industry trends and steel as a subordinate design element.
Now that the report has clearly indicated your value chain, as a next step I would expect to see a Groupwide strategy for the engineering business, electric furnaces, and other factors that contribute to a circular
economy. Steel is a predominant yet finite resource. Mines pose various environmental and social issues. I
hope that the company's commitment to creating a circular economy is included in the next report inaddition to decarbonization, which was mentioned in this year's report. I look forward to your businesstaking the lead in decarbonization, resilience, and the circular economy worldwide as well as in Japan.

JFE GROUP CSR REPORT 2020

206

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Editorial Policy
Editorial Policy
This report provides stakeholders with information about the JFE Group’s CSR activities and elicits
feedback to support further enhancement of the company’s activities and information disclosure. The
2020 report includes:
 Transition from a paper-based publication to disclosure of in-depth information through our
corporate website to more effectively update information and keep it linked to other media
 Unification of quantitative data collected from the report as a set of ESG data Categorizing social issues, risks, opportunities, and initiatives associated with our value
chain by each phase taking into account impact on stakeholders
 Evaluation of KPIs for material CSR issues based on performance results for FY2019 andthe use of those results to review KPIs for FY2020
 Recognition of climate change issues as a vital managerial concern; formulation of the JFEGroup medium- to long-term vision that includes targets for reducing CO2 emissions.
 Enriched the disclosure of information addressing climate change risks and opportunities bychanging composition in line with TCFD recommendations such as disclosure of scenario
analysis

CSR Report Composition and Format
A comprehensive report on the JFE Group’s CSR activities andquantitative ESG data

Scope of Report
Reporting Period
FY2019 (April 1, 2019 to March 31, 2020) Reports on some activities undertaken before or after thisperiod are included.

Organizations Covered
The report mainly covers the activities of JFE Holdings, Inc. and its three operating companies: JFE
Steel Corporation, JFE Engineering Corporation, and JFE Shoji Corporation, but also includes reports
on activities of other companies in the JFE Group (398 companies, of which 321 are consolidated
subsidiaries and 77 are equity-method affiliates). Quantitative information includes data from thefollowing JFE Group’s operating companies
JFE GROUP CSR REPORT 2020

207

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

JFE Steel Group: JFE Steel Corporation and 30 consolidated subsidiaries (total: 31 companies)［25 domestic companies］
JFE MINERAL COMPANY, LTD., Mizushima Ferroalloy Co., Ltd., JFE Material Co., Ltd., CHIBA
RIVERMENT AND CEMENT CORP., MIZUSHIMA RIVERMENT CORP., JFE PRECISIONCORPORATION, JFE Plastic Resource Corporation, JFE Bars & Shapes Corporation, JFE Metal
Products & Engineering Inc., JFE Galvanizing & Coating Co., Ltd., JFE Container Co., Ltd., JFE Welded
Pipe Manufacturing Co., Ltd., JFE Steel Pipe Co., Ltd., Galvatex Corporation, JFE Pipe Fitting Mfg. Co.,
Ltd., JFE Techno-wire Corporation, JFE Kozai Corporation, JFE LOGISTICS CORPORATION, JFE
Chemical Corporation, JFE LIFE CORPORATION, GECOSS CORPORATION, JFE ROCKFIBERCORPORATION, JFE KENZAI FENCE CO., LTD., J-Logitec Co., Ltd., K-PLASHEET CORPORATION［5 overseas companies］
Nova Era Silicon、JFE Steel Galvanizing（Thailand）Ltd.、Thai Coated Steel Sheet Co., Ltd.、
Philippine Sinter Corporation、PT．JFE STEEL GALVANIZING INDONESIAJFE Engineering Group: JFE Engineering Corporation and the following 11 consolidated domestic
subsidiaries (12 companies in total)［11 domestic companies］
J&T Recycling Corporation, JFE Environmental Service Corporation, NORTHERN JAPAN MACHINERY
Corporation, Tohoku Dock Ironworks Corporation, JFE Aqua Machine and Service Corporation, Fujikako,Inc., Asuka Soken Co,. Ltd., JFE Pipeline Engineering Corporation, JFE Technos Corporation, J Farm
Corporation, JFE Business Support YOKOHAMA Corporation

JFE Shoji Corporation Group: JFE Shoji Corporation and the following 33 domestic and overseas
consolidated subsidiaries (steel-processing companies) (total: 34 companies)［19 domestic subsidiaries］
JFE Shoji Electrical Steel Co., Ltd.* JFE Shoji Coil Center Corporation, JFE Shoji Kohnan Steel Center
Co., Ltd., Shoji Tinplate Center Corporation, Aichi Kanzai Kogyo Corporation, Kyusyu-Tech
Corporation, JFE Shoji Kohnan Steel Center Co., Ltd. Shin Nihon Kogyo Corporation, Taisei Kogyo
Corporation, Toyo Kinzoku Corporation, Tochigi Shearing Corporation, Naigai Steel Corporation,
Nagano Can Corporation, Niigata Steel Corporation, Nihon Jiseizai Kogyo Co., Ltd., Hokuriku Kogyo
Corporation, Hokuriku Steel Co., Ltd., Mizushima Steel Corporation, Mizushima Metal Products
Corporation* The data was collected as JFE Steel Group before FY2016.
［14 overseas subsidiaries］
Dongguan JFE Shoji Steel Products Co., Ltd., Guangzhou JFE Shoji Steel Products Co., Ltd., Zhejiang
JFE Shoji Steel Products Co., Ltd., Jiangsu JFE Shoji Steel Products Co., Ltd., JFE SHOJI STEELPHILIPPINES, INC., CENTRAL METALS (THAILAND) LTD., STEEL ALLIANCCE SERVICE CENTER CO.,LTD., JFE SHOJI STEEL VIETNAM CO., LTD., JFE SHOJI STEEL HAI PHONG CO., LTD., JFE SHOJISTEEL MALAYSIA SDN. BHD., PT. JFE SHOJI STEEL INDONESIA, JFE SHOJI STEEL INDIA PRIVATELIMITED, VEST INC., JFE SHOJI STEEL DE MEXICO, S.A. DE C.V.
JFE GROUP CSR REPORT 2020

208

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Reference Guidelines
GRI Sustainability Reporting Standards 2016 and 2018
Ministry of the Environment (Japan): Environmental Reporting Guidelines 2018
Ministry of the Environment (Japan): Environmental Accounting Guidelines 2005
Final Report: Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD)

Publication Date
Website: September 2020; PDF file: October 2020(previous issue: October 2019; next issue: scheduled for October 2021)

Related Reports
The following information is available at

http://www.jfe-holdings.co.jp/en/

Company Profile
Outline of the JFE Group, corporate governance, etc.

Investor Information
JFE Group business information, financial data, stock and rating information, etc.

JFE GROUP Report (Integrated Report)
Financial information including the JFE Group’s mid- to long-term business strategies, businessperformance, management strategies and non-financial information, including CSR activities,
corporate governance, etc.

JFE GROUP CSR REPORT 2020

209

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

Guideline Content Indices
GRI Content Index
This report is prepared with reference to the GRI Sustainability Reporting Standards 2016/2018.
Note: We refer to JFE GROUP REPORT 2020 (Integrated Report), Securities Report from April 1, 2019
to March 31, 2020) and Corporate Governance Report as of June 21, 2020.
GRI 102: General Disclosures 2016
Disclosure

Pages
CSR Report

Other Reports

1. Organizational profile
102-1

Name of the organization

-

102-2

Activities, brands,
products, and services

-

102-3

Location of headquarters

-

102-4

Location of operations

-

102-5

Ownership and legal form-

Overview of JFE Holdings(https://www.jfeholdings.co.jp/en/company/info/index.html)

JFE GROUP REPORT(Integrated Report): p.17-20
Overview of JFE Holdings(https://www.jfeholdings.co.jp/en/company/info/index.html)

About JFE Group (https://www.jfeholdings.co.jp/en/company/gabout/index.html)

Overview of JFE Holdings(https://www.jfeholdings.co.jp/en/company/info/index.html)

Overview of JFE Holdings
102-6Markets served-(https://www.jfeholdings.co.jp/en/company/info/index.html)

About JFE Group (https://www.jfeholdings.co.jp/en/company/gabout/index.html)

Scale of the organization

Social Data (P. 187)

JFE GROUP REPORT(Integrated Report): pp.15-16, pp.3132, pp.33-41, p.98

102-8

Information on employees
and other workers

Social Data (P. 187)

JFE GROUP REPORT(Integrated Report): p.96

102-9

Supply chain

JFE Group Value Chain(P. 6)

102-10Significant changes to theorganization and its supply
chain

102-7

102-11

Precautionary Principle orapproach

Not applicable
Environmental
Management (P. 39)
JFE Group’s Responseto the TCFD (P. 74)
Risk Management(P. 161)--

JFE GROUP CSR REPORT 2020

210

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）102-12External initiatives

Steel Industry Initiatives(P. 90)
Biodiversity (P. 106)
Human Rights (P. 135)
Community (P. 138)

102-13

Membership of associations

Steel Industry Initiatives(P. 90)-

Message from the CEO (P. 1)-

Message from the CEO (P. 1)
JFE Group Value Chain (P. 6)
Material CSR Issues (P. 22)
JFE Group’s Response to the
TCFD (P. 74)--

2. Strategy
102-14102-15

Statement from seniordecision-maker
Key impacts, risks, andopportunities

3. Ethics and integrity
102-16

Values, principles, standards,
and norms of behavior

Corporate Vision/BusinessConduct(P. 4)-

102-17

Mechanisms for advice andconcerns about ethics

Compliance （including Anticorruption）(P. 158)

JFE GROUP REPORT(Integrated Report): p.93

4. Governance102-18Governance structure

Corporate Governance(P. 149)-

102-19Delegating authority

CSR Structure (P. 29)-

102-20Executive-level responsibility
for economic, environmental,
and social topics

CSR Structure (P. 29)-

102-21

Consulting stakeholders on
economic, environmental, andsocial topics

CSR Structure (P. 29)
Compliance （including Anticorruption）(P. 158)-

102-22102-23Composition of the highest
governance body and its
committees
Chair of the highest governancebody

Corporate Governance(P. 149)-

JFE GROUP REPORT(Integrated Report): pp.8384, pp.85-88
Corporate
Governance Report: p.7
JFE GROUP REPORT(Integrated Report): pp.8688

102-24

Nominating and selecting thehighest governance body

Corporate Governance(P. 149)

102-25

Conflicts of interest

Corporate Governance(P. 149)

102-26

Role of highest governancebody in setting purpose, values,
and strategy--

102-27

Collective knowledge of highest
governance body--

Corporate
Governance Report: p.2

JFE GROUP CSR REPORT 2020

211

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）102-28

Evaluating the highest
governance body’s performance

Corporate Governance(P. 149)-

102-29Identifying and managing
economic, environmental,
and social impacts

CSR Structure (P. 29)
Environmental Management(P. 39)-102-30Effectiveness of risk
management processes

Risk Management(P. 161)-

CSR Structure (P. 29)-

CSR Structure (P. 29)-

102-31
102-32

Review of economic,
environmental, and social
topicsHighest governance body’s rolein sustainability reporting

102-33

Communicating criticalconcerns

Compliance （including Anticorruption） (P. 158)-

102-34Nature and total number ofcritical concerns

Compliance （including Anticorruption） (P. 158)-

102-35

Remuneration policies

Corporate Governance(P. 149)

102-36

Process for determining
remuneration

Corporate Governance(P. 149)

102-37

Stakeholders’ involvement inremuneration--

102-38Annual total compensation ratio--

102-39Percentage increase in annual
total compensation ratio--

JFE GROUP REPORT(Integrated Report): pp.8889
JFE GROUP REPORT(Integrated Report): pp.8889

5. Stakeholder engagement102-40102-41
102-42102-43102-44

List of stakeholder groups
Collective bargaining
agreements
Identifying and selecting
stakeholders
Approach to stakeholder
engagement
Key topics and concerns raised

CSR Structure (P. 29)

-

-

-

-

-

CSR Structure (P. 29)-

Third-part Comments(P. 204)-

6. Reporting practice102-45

Entities included in the
consolidated financial
statements

Editorial Policy (P. 207)-

102-46

Defining report content andtopic Boundaries

Editorial Policy (P. 207)-

102-47

List of material topics

Material CSR Issues (P. 22)-

JFE GROUP CSR REPORT 2020

212

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
102-48

Restatements of information

Climate Change (P. 63)
Environmental Data (P. 165)-

102-49Changes in reporting

Editorial Policy (P. 207)-102-50

Reporting period

Editorial Policy (P. 207)-102-51

Date of most recent report

Editorial Policy (P. 207)-102-52

Reporting cycle

Editorial Policy (P. 207)-102-53

Contact point for questions
regarding the report

Submit Comments on the JFEGroup CSR Report (Japanese
Only)(https://www.jfe-

102-54Claims of reporting inaccordance with the GRI
Standards

102-55102-56

GRI content index
External assurance

Contact Us(https://www.jfeholdings.co.jp/en/contact.html)

holdings.co.jp/csr/pdf/form_er2020j.
html)

Reference-

This table-

Independent AssuranceStatement (P. 197)-

GRI103：Management Approach 2016
Disclosure

Pages
ReportEnvironmental Data Book

Material CSR Issues (P. 22)-

Material CSR Issues (P. 22)
CSR Structure (P. 29)
Supply Chain Management(P. 37)
Environmental Management(P. 39)Climate Change (P. 63)
JFE Group’s Response to the
TCFD (P. 74)
Prevention of Pollution(P. 95)
Efficient Use of Resources(P. 100)
Water Security (P. 103)
Biodiversity (P. 106)
Customer Responsibility(P. 111)
Occupational Health and
Safety (P. 117)
Labor Standards (P. 124)-

GRI- 103: Management Approach
103-1
103-2

103-3

Explanation of the material
topic and its Boundary
The management approach andits components

Evaluation of the management
approach-

JFE GROUP CSR REPORT 2020

213

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

GRI200: Economic topics
Disclosure

Pages
CSR Report

Other Reports
Securities Report:
pp.2-3 (Transition of Key
Management Indicators,etc.),
p.14 (Status of
Employees),
p.50 (Dividend Policy),p.84 (Consolidated Income
Statement)

GRI- 201: Economic Performance 2016

201-1

Direct economic value
generated and distributed

Environmental Management(P. 39)Community (P. 138)

201-2

Financial implications and otherrisks and opportunities due toclimate change

JFE Group’s Response to the
TCFD (P. 74)
Environmental Management(P. 39)201-3

Defined benefit plan obligations
and other retirement plans

-

201-4

Financial assistance received
from government

-

-

-

-

-

-

Securities Report:
p.127(Postemployment
Benefits)

GRI- 202: Market Presence 2016
202-1
202-2

Ratios of standard entry level
wage by gender compared to
local minimum wage
Proportion of senior
management hired from thelocal community

GRI- 203: Indirect Economic Impacts 2016
203-1

Infrastructure investments andservices supported

Environmental Management(P. 39)Community (P. 138)

-

203-2

Significant indirect economic
impacts

Message from the CEO (P. 1)
JFE Group Value Chain (P. 6)
Material CSR Issues (P. 22)

-

-

-

-

-

Compliance (including Anticorruption) (P. 158)

-

-

-

GRI- 204: Procurement Practices 2016
204-1

Proportion of spending on local
suppliers

GRI- 205: Anti-corruption 2016
205-1
205-2
205-3

Operations assessed for risks
related to corruption
Communication and training
about anti-corruption
policies and procedures
Confirmed incidents ofcorruption and actions taken

JFE GROUP CSR REPORT 2020214

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
GRI-206： Anti-competitive Behavior 2016
206-1

Legal actions for anticompetitive behavior, antitrust, and monopoly practices--

GRI300: Environmental topics
Disclosure

Pages
CSR Report

Other Reports

Materials used by weight orvolumeMaterial Flow (P. 61)
Environmental Data (P. 165)

-

301-2

Recycled input materials

Material Flow (P. 61)
Efficient Use of Resources(P. 100)
Environmental Data (P. 165)

-

301-3

Reclaimed products and theirpackaging

Material Flow (P. 61)
Efficient Use of Resources(P. 100)
Environmental Data (P. 165)-

Material Flow (P. 61)
Climate Change (P. 63)
Environmental Data (P. 165)

-

-

-

GRI-301:Materials 2016
301-1

GRI-302：Energy 2016
302-1

Energy consumption within

302-2

Energy consumption outside of
the organization

302-3

Energy intensity

Climate Change (P. 63)
Environmental Data (P. 165)

-

302-4

Reduction of energy
consumption

Climate Change (P. 63)
Environmental Data (P. 165)

-

302-5

Reductions in energy
requirements of products andservices

Steel Industry Initiatives(P. 90)-

GRI-303: Water 2018
303-1

Interactions with water as ashared resources

Water Security (P. 103)

-

303-2

Management of water
dischargerelated impacts

Prevention of Pollution(P. 95)
Environmental Data (P. 165)-

Water withdrawal

Material Flow (P. 61)
Water Security (P. 103)
Environmental Data (P. 165)

-

303-3

JFE GROUP CSR REPORT 2020

215

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
303-4

Water discharge

Material Flow (P. 61)
Environmental Data (P. 165)

-

303-5

Water consumption

Material Flow (P. 61)
Water Security (P. 103)
Environmental Data (P. 165)

-

-

-

GRI- 304: Biodiversity 2016

304-1

Operational sites owned,
leased, managed in, or adjacentto, protected areas and areas ofhigh biodiversity value outside
protected areas

304-2

Significant impacts ofactivities, products, andservices on biodiversity

304-3

Habitats protected or restored

-

-

304-4

IUCN Red List species andnational conservation list
species with habitats in areas
affected by operations--

Biodiversity (P. 106)-

GRI-305: Emissions 2016
305-1

Direct (Scope 1) GHG
emissions

Material Flow (P. 61)
Climate Change (P. 63)
Environmental Data (P. 165)

-

305-2

Energy indirect (Scope 2) GHG
emissions

Material Flow (P. 61)
Climate Change (P. 63)
Environmental Data (P. 165)

-

305-3

Other indirect (Scope 3) GHG
emissions

Climate Change (P. 63)
Environmental Data (P. 165)

-

305-4

GHG emissions intensity

Climate Change (P. 63)
Environmental Data (P. 165)

-

305-5

Reduction of GHG emissions

Climate Change (P. 63)
Environmental Data (P. 165)

-

305-6

Emissions of ozone-depleting
substances (ODS)

-

-

305-7

Nitrogen oxides (NOx), sulfur
oxides (SOx), and othersignificant air emissions

Material Flow (P. 61)
Prevention of Pollution(P. 95)
Environmental Data (P. 165)-

GRI- 306: Effluents and Waste
306-1

Water discharge by qualityand destination

Material Flow (P. 61)
Environmental Data (P. 165)

-

306-2

Waste by type and disposal
methodMaterial Flow (P. 61)
Efficient Use of Resources(P. 100)
Environmental Data (P. 165)

-

306-3

Significant spills

Not applicable

JFE GROUP CSR REPORT 2020

216

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

External
Evaluations
and Awards

ESG Data

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
306-4

Transport of hazardous
waste

-

-

306-5

Water bodies affected bywater discharges and/or
runoff--

GRI- 307: Environmental Compliance 2016
307-1

Non-compliance withenvironmental laws andregulations

Environmental
Management (P. 39)-

GRI- 308: Supplier Environmental Assessment 2016308-1

New suppliers that werescreened using
environmental criteria

-

-

308-2

Negative environmental
impacts in the supply chain
and actions taken--

GRI400: Social topics
Pages

Disclosure

CSR Report

Other Reports

Labor Standards (P. 124)
Social Data (P. 187)

-

-

-

Social Data (P. 187)-

GRI- 401: Employment 2016
401-1

New employee hires andemployee turnover

401-2

Benefits provided to fulltime employees that are notprovided to temporary or
part-time employees

401-3

Parental leave

GRI- 402: Labor/Management Relations 2016
402-1

Minimum notice periods
regarding operationalchanges--

GRI- 403: Occupational Health and Safety 2018403-1

Occupational health andsafety management system

Occupational Health and
Safety (P. 117)

-

403-2

Hazard identification, risk
assessment, and incident
investigation

Occupational Health and
Safety (P. 117)

-

403-3

Occupational healthservices

Occupational Health and
Safety (P. 117)-

JFE GROUP CSR REPORT 2020

217

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

403-4

Worker participation,
consultation, andcommunication on
occupational health andsafetyOccupational Health and
Safety (P. 117)

-

403-5

Worker training on
occupational health andsafetyOccupational Health and
Safety (P. 117)

-

403-6

Promotion of worker healthOccupational Health and
Safety (P. 117)

-

403-7

Prevention and mitigation ofoccupational health andsafety impacts directly
linked by business
relationships

Occupational Health and
Safety (P. 117)

-

403-8

Workers covered by an
occupational health andsafety management system

403-9Work-related injuries

Social Data (P. 187)-

403-10Work-related ill healthOccupational Health and
Safety (P. 117)

-

-

-

GRI- 404: Training and Education 2016
404-1

Average hours of training
per year per employee

-

-

404-2

Programs for upgrading
employee skills andtransition assistanceprograms

Labor Standards (P. 124)

-

404-3

Percentage of employees
receiving regularperformance and careerdevelopment reviews--

GRI-405: Diversity and Equal Opportunity 2016405-1

Diversity of governancebodies and employees

Labor Standards (P. 124)
Social Data (P. 187)

-

405-2

Ratio of basic salary andremuneration of women to
men

-

-

-

-

GRI- 406: Non-discrimination 2016406-1

Incidents of discriminationand corrective actions taken

JFE GROUP CSR REPORT 2020

218

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
GRI- 407: Freedom of Association and Collective Bargaining 2016

407-1

Operations and suppliers inwhich the right to freedomof association andcollective bargaining may
be at risk

-

-

-

-

-

-

-

-

-

-

412-1

Operations that have been
subject to human rights
reviews or impact
assessments

-

-

412-2

Employee training on
human rights policies orprocedures

Human Rights (P. 135)

-

412-3

Significant investment
agreements and contracts
that include human rights
clauses or that underwent
human rights screening--

GRI- 408: Child Labor 2016
408-1

Operations and suppliers at
significant risk for incidents
of child labor

GRI- 409: Forced or Compulsory Labor 2016409-1

Operations and suppliers at
significant risk for incidents
of forced or compulsory
labor

GRI- 410: Security Practices 2016
410-1

Security personnel trainedin human rights policies orprocedures

GRI- 411: Rights of Indigenous Peoples 2016
411-1

Incidents of violations
involving rights ofindigenous peoples

GRI- 412: Human Rights Assessment 2016

GRI- 413: Local Communities 2016413-1

Operations with local
community engagement,
impact assessments, anddevelopment programs

Community (P. 138)-

JFE GROUP CSR REPORT 2020

219

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）

413-2

Operations with significant
actual and potential
negative impacts on local
communities

Not applicable-

GRI- 414: Supplier Social Assessment 2016414-1

New suppliers that werescreened using social
criteria

-

-

414-2

Negative social impacts inthe supply chain andactions taken

JFE Group Value Chain(P. 6)

-

-

-

416-1

Assessment of the healthand safety impacts ofproduct and service
categories

Customer Responsibility(P. 111)-416-2

Incidents of noncompliance concerning thehealth and safety impacts
of products and services

-

-

-

-

Not applicable

-

-

-

-

-

-

-

GRI- 415: Public Policy 2016
415-1

Political contributions

GRI- 416: Customer Health and Safety 2016

GRI- 417: Marketing and Labeling 2016
417-1

Requirements for productand service information andlabeling

417-2

Incidents of noncompliance concerning
product and service
information and labeling

417-3

Incidents of noncompliance concerningmarketing communications

GRI- 418: Customer Privacy 2016
418-1

Substantiated complaints
concerning breaches ofcustomer privacy andlosses of customer data

GRI- 419: Socioeconomic Compliance 2016
419-1

Non-compliance with laws
and regulations in the socialand economic area

JFE GROUP CSR REPORT 2020

220

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
IndicesComparison with Environmental Reporting Guidelines 2018 (Ministry of the Environment, Japan)
Chapter 1: Basic Information of Environmental Reporting
Items

Contents

1. Basic requirements for environmental reporting(1) Boundary

Editorial Policy (P. 207)(2) Reporting period

Editorial Policy (P. 207)

(3) Reporting standards and guidelines

Editorial Policy (P. 207)
Guideline Content Indices (P. 210)(4) Overview of the environmental report

Editorial Policy (P. 207)

2. Trends in key performance indicators(1) Trends in major performance indicators

Material CSR Issues of the JFE Group(P. 22)

Chapter 2: Items to Be Included in Environmental Reporting
Items

Contents

1. Top Management Commitments(1) Top management commitments to the JFE Group’s
response to material environmental issues

Message from the CEO (P. 1)

2. Governance(1) JFE Group governance structure

CSR Structure (P. 29)(2) Manager responsible for material environmental
issuesEnvironmental Management (P. 39)
JFE Group’s Response to the TCFD
(P. 74)(3) Roles of the board of directors and board of
executive officers in the management of material
environmental issues

Environmental Management (P. 39)
JFE Group’s Response to the TCFD
(P. 74)

3. Stakeholder Engagement(1) Corporate policies to stakeholders

Environmental Management (P. 39)(2) Overview of stakeholder engagement activities
conducted in the reporting period

JFE Group Value Chain (P. 6)
Environmental Communication (P. 109)
CSR Structure (P. 29)

4. Risk Management(1) Environment-related risk identification, assessment,
and management processes

CSR Structure (P. 29)
JFE Group’s Response to the TCFD
(P. 74)
Risk Management (P. 161)

(2) Positioning of the above processes in the JFEGroup’s overall risk management

CSR Structure (P. 29)
Risk Management (P. 161)

JFE GROUP CSR REPORT 2020

221

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
5. Business Model(1) JFE Group business model

JFE Group Value Chain (P. 6)
JFE GROUP REPORT(Integrated Report): pp.17-20

6. Value Chain Management(1) Value chain overview

JFE Group Value Chain (P. 6)(2) Green procurement policy, objectives, and results

Supply Chain Management (P. 37)(3) Status of eco-friendly products and services

Development and Provision of Ecofriendly Processes and Products (P. 46)

7. Long-term Vision(1) Long-term vision

Message from the CEO (P. 1)
Climate Change (P. 63)
JFE Group’s Response to the TCFD
(P. 74)(2) Time period covered by the long-term vision

Message from the CEO (P. 1)
Climate Change (P. 63)
JFE Group’s Response to the TCFD
(P. 74)(3) Reasons why that time period was selected

Climate Change (P. 63)
JFE Group’s Response to the TCFD
(P. 74)

8. Strategy(1) JFE Group business strategy for contributing to theachievement of a sustainable society

Message from the CEO (P. 1)
Material CSR Issues (P. 22)
JFE Group’s Response to the TCFD
(P. 74)
Steel Industry Initiatives (P. 90)

9. Methodology for Identifying Material Environmental Issues(1) Procedure by which the JFE Group identified its
material environmental issues

Material CSR Issues (P. 22)
JFE Group’s Response to the TCFD
(P. 74)(2) List of identified material environmental issues

Material CSR Issues (P. 22)
JFE Group’s Response to the TCFD
(P. 74)(3) Reasons that the identified environmental issues
were judged material

Material CSR Issues (P. 22)
JFE Group’s Response to the TCFD
(P. 74)(4) Boundaries of the material environmental issues

JFE Group Value Chain (P. 6)
Material CSR Issues (P. 22)
JFE Group’s Response to the TCFD
(P. 74)

JFE GROUP CSR REPORT 2020

222

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
10. JFE Group Material Environmental Issues(1) Policies and/or action plans

Corporate Vision/Business Conduct(P. 4)JFE Group Value Chain (P. 6)
Material CSR Issues (P. 22)
JFE Group’s Response to the TCFD
(P. 74)(2) Targets and results of policies/action plans based on
performance indicators

Material CSR Issues (P. 22)
CSR Structure (P. 29)(3) Methodologies used for calculating eachperformance indicator

Material CSR Issues (P. 22)(4) Aggregation scope of data for each performanceindicator

Material CSR Issues (P. 22)
Editorial Policy (P. 207)(5) Financial impact of risks and opportunities, andcalculation methodologies if the financial impact issignificant

Environmental Management (P. 39)
JFE Group’s Response to the TCFD
(P. 74)
Environmental Data (P. 165)

(6) Assurance report by an independent third party

Independent Assurance Statement(P. 197)

Reference: Major Environmental Issues and Their Performance Indicators
Items

Contents

1. Climate Change
Greenhouse Gas Emissions(1) Scope 1 emissions

Material Flow (P. 61)
Climate Change (P. 63)
Environmental Data (P. 165)

(2) Scope 2 emissions

Material Flow (P. 61)
Climate Change (P. 63)
Environmental Data (P. 165)

(3) Scope 3 emissions

Climate Change (P. 63)
Environmental Data (P. 165)

Emission Intensity(1) Greenhouse gas emission intensity

Climate Change (P. 63)
Environmental Data (P. 165)

Energy Usage(1) Breakdown of energy usage and overall energy usage(2) Renewable energy usage as a percentage of overall
energy usage

Material Flow (P. 61)
Climate Change (P. 63)
Environmental Data (P. 165)-

JFE GROUP CSR REPORT 2020

223

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
2. Water Resources(1) Water resource inputs(2) Water intensity

Material Flow (P. 61)
Water Security (P. 103)
Environmental Data (P. 165)-(3) Water discharge

Material Flow (P. 61)
Environmental Data (P. 165)

(4) Status of water stress

Water Security (P. 103)

3. Biodiversity(1) Impact of business activities on biodiversity

Biodiversity (P. 106)(2) Status and extent of the dependency of the JFEGroup’s business activities on biodiversity

Biodiversity (P. 106)

(3) Business activities that contribute to biodiversity
conservation

Biodiversity (P. 106)(4) Status of cooperation with external stakeholders

Biodiversity (P. 106)

4. Resource Circulation
Resource Inputs(1) Volume of nonrenewable resource inputs

Material Flow (P. 61)
Environmental Data (P. 165)

(2) Volume of renewable resource inputs

Material Flow (P. 61)
Environmental Data (P. 165)

(3) Volume of recycled materials used

Material Flow (P. 61)
Environmental Data (P. 165)

(4) Rate of recycled and reused resources(= volume ofrecycled materials used/ volume of resource inputs)

Material Flow (P. 61)
Efficient Use of Resources (P. 100)
Environmental Data (P. 165)

Resource Waste(1) Total production of waste

Material Flow (P. 61)
Efficient Use of Resources (P. 100)
Environmental Data (P. 165)

(2) Total final disposal volume of waste

Material Flow (P. 61)
Efficient Use of Resources (P. 100)
Environmental Data (P. 165)

JFE GROUP CSR REPORT 2020

224

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）
5. Chemical Substances(1) Volume of chemical substances in storage-(2) Volume of chemical substance emissions

Material Flow (P. 61)
Prevention of Pollution (P. 95)
Environmental Data (P. 165)

(3) Volume of chemical substances transferredMaterial Flow (P. 61)
Prevention of Pollution (P. 95)
Environmental Data (P. 165)

(4) Volume of chemical substances handled (volume
used)

-

6. Pollution prevention
General(1) Status of legal compliance

Environmental Management (P. 39)

Air quality conservation(1) Air-pollutant emissions volume, emission
concentration in air pollution regulations

Material Flow (P. 61)
Prevention of Pollution (P. 95)
Environmental Data (P. 165)

Water pollution(1) Water pollution load, emission concentration inemissions regulations

Material Flow (P. 61)
Prevention of Pollution (P. 95)
Environmental Data (P. 165)

Soil pollution(1) Status of soil pollution

Environmental Management (P. 39)

JFE GROUP CSR REPORT 2020

225

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices

TCFD Content Index
Overview of TCFD
Recommendations

Recommended Disclosures【Governance】
Disclose the organization’s
governance around climaterelatedrisks and opportunities.

【Strategy】
Disclose the actual and potential
impacts of climate-related risks
and opportunities on theorganization’s businesses,
strategy and financial planningwhere such information ismaterial.

Contents

a. Describe the board’s
oversight of climate-relatedrisks and opportunities
b. Describe management’s rolein assessing and managing
climate-related risks andopportunities
a. Describe the climate-relatedrisks and opportunities theorganization has identified
over the short, medium, andlong termb. Describe the impact ofclimate-related risks andopportunities on theorganization’s businesses,
strategy, and financial
planningc.

Describe the resilience ofthe organization’s strategy,
taking into considerationdifferent climate-related
scenarios, including a 2℃ orlower scenario

a. Describe the organization’s
processes for identifying andassessing climate-related
risks【Risk Management】
Disclose how the organization
identifies, assesses, and manages
climate-related risks.

b. Describe the organization’s
processes for managing
climate-related risksc.

Describe how processes for
identifying, assessing andmanaging climate-relatedrisks are integrated into theorganization’s overall risk
management

Corporate Governance(P. 149)
Risk Management(P. 161)
Climate Change (JFEGroup’s Response to the
TCFD：Governance)(P. 75)

JFE Group Value Chain(P. 6)
Climate Change (The JFEGroup’s Medium- to
Long-term Vision) (P. 63)
Climate Change (JFEGroup’s Response to the
TCFD：Strategies)(P. 76)

Risk Management(P. 161)
Environmental
Management (P. 39)
Climate Change (JFEGroup’s Response to the
TCFD：Risk
Management) (P. 87)

JFE GROUP CSR REPORT 2020

226

Message fromthe CEO

JFE Group
VisionCSRManagement

Environment

SocialGovernance

ESG Data

External
Evaluations
and Awards

Editorial
PolicyGuideline
Indices（Continued from the previous page.）a. Disclose the metrics used by
the organization to assessclimate-related risks andopportunities in line with its
strategy and risk
management process【Metrics and Targets】
Disclose the metrics and targets
used to assess and manage
relevant climate-related risks andopportunities.

b. Disclose Scopes 1 and 2 and,if appropriate, Scope 3
greenhouse gas (GHG)
emissions and related risksc.

Describe the targets used by
the organization to manage
climate-related risks andopportunities andperformance against targets

Material CSR Issues(KPIs for Material CSR
Issues) (P. 26)
Climate Change (JFEGroup’s Response to the
TCFD：Metrics andTargets) (P. 88)
Climate Change (CO2
Emissions of the JFEGroup) (P. 63)
Environmental Data
(P. 165)
Material CSR Issues(KPIs for Material CSR
Issues) (P. 26)
Climate Change (The JFEGroup’s Medium- to
Long-term Vision) (P. 63)
Climate Change (JFEGroup’s Response to the
TCFD：Metrics andTargets) (P. 88)

JFE GROUP CSR REPORT 2020227