CSR REPORT 2022

We dedicate ourselves to manufacture products valuable for the society
and welcomed by all the people making extensive use oftechnologies and wisdom available in every corner of the world
CSR Basic Policy

YGK Group will make people's lives more comfortable, protect theenvironment and continue pushing towards a sustainable global
society by constantly striving to manufacture useful products whichbring true happiness and meaningful value to everyone.

S D G sAiming for a Sustainable Society -YGK's Goals
Business Activities

Corporate Profile (as of March 31, 2022)
Corporate Name
YUKI GOSEI KOGYO CO., LTD.
Date of Establishment
November 4, 1947
Capital3,471 million yen

Safety and Health/Environmental Preservation/
Quality Assurance Activities

Location and Contact Details of Head Office10-4, Nihonbashi-Ningyocho 3-chome,
Chuo-ku, Tokyo 103-0013
TEL : +81-3-3664-3980
FAX : +81-3-3664-3998

Amino AcidsBusiness Description
	Production and sale of organic synthetic
chemicals, general chemicals, pharmaceuticals,
food additives, industrial chemicals, etc.

Enriching Lifestyles
Our products in the field of nutrition and umami enrich lifestyles

Specialty Chemicals
Improving the Future
Our products support cutting-edge technology to create a better future

Number of Employees
296

I N D E X
Corporate Philosophy ································································· 2
CSR Basic Policy ··············································································· 2
SDGs ·············································································································· 2
Corporate Profile ············································································· 3
President's Message ···································································· 4
Overview of YUKI GOSEI KOGYO CO., LTD. (YGK)YGK's History ····················································································· 5
Overview of Each Product Category ······························· 6
Major YGK Products that Contribute to SDGs ··········· 6
Financial Position ··········································································· 7
Operating Results ·········································································· 7Intellectual Property ··································································· 7

Corporate Management
Corporate Governance ······························································ 8
Medium-term Management Plan and Basic Policy ······ 10
Key Measures ·················································································· 10
Numerical Targets ······································································· 10
Dialogue with Shareholders and Investors ··············· 10
Risk Management ·········································································11Compliance ·······················································································11

Environmental Initiatives
Basic Policy ······················································································· 12
Reduction of CO2 Emissions ················································· 12Prevention of Water Pollution ············································ 12Prevention of Air Pollution ···················································· 13
Reduction of Waste and Recycling ································· 14
Material Flow ·················································································· 14
Environmental Management System ··························· 14

Safety and Health Initiatives
Safety and Disaster Prevention Basic Policy ············· 15

Pharmaceuticals
Protecting Lives
Our products and operations meet the highest international standards
for quality and safety to protect people’s lives.

Factory Reform Activities (Safety Initiatives) ··········· 15
Safety and Health ·········································································16
EHS Initiatives ··················································································16
Quality Policy ···················································································17
New Product Safety Inspections ·······································17
Logistics Safety ··············································································17
Logistics Accident Prevention ·············································17

Engagement with Local Communities
Food Loss Initiatives ·································································· 18
Donations ·························································································· 18
Sponsorship ····················································································· 18
Preservation of Regional Natural Environments ····· 18

2 | CSR REPORT 2022

CSR REPORT 2022 | 3

P r esident 's Message
Based on our philosophy of "We dedicate ourselves to manufacture products valuable for the society
and welcomed by all the people making extensive use of technologies and wisdom available in every
corner of the world "YUKI GOSEI KOGYO aims to contribute to the achievement of a sustainable society
by developing, manufacturing, and marketing unique and valuable products, and supplying such safeand reliable chemical products to people around the world. Through this CSR report, we aim to raiseawareness about our CSR initiatives and meet the expectations of a wide range of stakeholders including
our shareholders and investors, our business partners, local communities and our employees.
Our company was founded in 1947 as a high-tech chemical manufacturer engaged in the industrial
development of natural sweet fragrances. Under the subsequent post-war recovery, the company
expanded through "manufacturing," launching a wide range of chemical products, including industrial
chemicals, food additives and active pharmaceutical ingredients (APIs).
In recent years, we have strengthened our portfolio of products in the three fields of amino acids,
specialty chemicals and pharmaceuticals, with particular emphasis on products in the healthcare sector,
and we have also focused on new product development, thereby establishing a balanced businessstructure across these three fields. As a first step to further fortifying this foundation and enhancing
business continuity, we set "improving quality culture" as a top priority under our three-year mediumterm business plan beginning FY2020 and are making groupwide efforts to achieve this goal.
The rationale behind this goal is that the materials we supply are pharmaceuticals which protect people's
lives, industrial products which are essential for industrial development, and food products which enrich
lifestyles and, for some of these materials, we are the only supplier in the world. We are committed to
improving the quality culture because we recognize that every single product we produce comes with ahuge social responsibility and we intend to remain worthy of everyone's trust in the future.
Using the sustainability assessment service provided by
EcoVadis, a French environmental, social, and governance(ESG) sustainability rating provider, we achieved a high Gold
medal rating, which is given to companies that score within
the top 5% of all companies. We are also striving for carbon
neutrality, and even after switching to fuels that allow us tosignificantly reduce our CO2 emissions and introducing cogeneration systems, we have still continued with activities toreduce our greenhouse gas emissions.
We are also keen to make our own technologies available
if this technology will contribute to society. Supplying
APIs to meet unmet medical needs is one such example.
We are also actively pursuing open innovation andcollaborating with universities over the discovery of new
functions of amino acids, most recently entering the foodsupplements market. Looking ahead to an aging society, we
also anticipate that amino acids will have applications forpresymptomatic disease, with healthy life expectancy andimmunity as keywords.
Leveraging our technology and speed, we will continue
taking on new challenges as a company which creates usefulproducts which bring happiness.
October 2022
Seiichiro Matsumoto, President & CEO

Overview of
YUKI GOSEI KOGYO CO., LTD. (YGK)01

YGK's History2022

Net sales 12,361 million yen

2021 Obtained FSSC 22000 certification (Joban Factory)
Quality enhancement

2016 Installed membrane separation activated sludge system
2014 Installed co-generation system

Environmental measures

CO² reductions

2012 ❾ Started manufacture of active pharmaceuticalingredients for generics

2007 Switched to LNG fuel CO² reductions

1999 Obtained ISO 14001 certification (Joban Factory) Environmental measures1998 Obtained ISO 9001 certification Quality enhancement
1996 ❽ Started manufacture of trifluorothymidine

1985 ❸❹ Started manufacture of organosilicon compounds

1978 Installed activated sludge treatment facilities Environmental measures1965 ❼ Started manufacture of protamine sulfate
1964 Started operation of Joban Factory in Iwaki City, Fukushima Prefecture1962 Listed on the Second Section of the Tokyo Stock Exchange ( TSE)
1960 ❺ Started manufacture of 2-vinylpyridine
1958 ❷ Started manufacture of β-alanine

1952 Started manufacture of ❶ glycine, and ❻ isoniazid
1947 YUKI GOSEI KOGYO CO., LTD. was established to produce flavors for tobacco* ❶〜❾ above are linked to "Major YGK products that contribute to SDGs" on the next page.

4 | CSR REPORT 2022

CSR REPORT 2022 | 5

Overview of YUKI GOSEI KOGYO CO., LTD. (YGK)01

Overview of Each Product Category (FY3/2022)
Amino Acids

Specialty Chemicals

Financial Position (Million yen)

Current
assets

8,916

4,411

million yen

Net sales

3,143

million yen

Net sales

4,806

million yen

Sales Trend by Business Segment■ Amino Acids ■ Specialty Chemicals ■ Pharmaceuticals（Million yen）

14,0002020 Medium-term Plan
(underway)

12,000181

10,362 8,523
Intangible assets
216

Fixed
assetsInvestments andother assets

Property, plantand equipment

Current
assets9,718

Intangible assets

Net sales

21,172

20,998Property, plantand equipment

6,539

Total assets

Total assets

Pharmaceuticals

Current liabilities

Fixed
assetsInvestments andother assets

2,181 11,279

10,810 2,070

At end of theprevious fiscal year

End of fiscal year
As of March 31, 2022

As of March 31, 2021

Non-current
liabilities

3,512

Shareholders'equityTotal
liabilities andnet assets

Total
liabilities andnet assets

20,998Current liabilities

6,969

21,172

Non-current
liabilities

3,199

Liabilities

Liabilities

10,16810,052

Shareholders'equity10,131

Valuation andtranslation
adjustments

815

10,307
Net assets

Valuation andtranslation
adjustments

Net assets

10,946

11,004

At end of theprevious fiscal year696

End of fiscal year
As of March 31, 2022

As of March 31, 2021

10,000Operating Results (Million yen)

8,000
6,000

Net
sales

Net
sales

12,361

11,091

4,000

0

2,356

Gross
profit

2,000

1,821
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

OperatingprofitMajor YGK Products that Contribute to SDGs (Sustainable Development Goals)

Operatingprofit413

Profit218

Fiscal Year (As of March 31)

Grossprofit288

Ordinary
profit397

Profit248

Ordinary
profit176

Previous fiscal year

Fiscal year under review

From April 1, 2020 to March 31, 2021

From April 1, 2021 to March 31, 2022

Our corporate activities are closely linked to the SDGs. The section below explains how major YGK products
contribute to the SDGs.

Amino Acids

Specialty Chemicals

Pharmaceuticals❶ Glycine
Glycine is used as a food additive toimprove the shelf life of food products,
thereby helping to reduce food loss. It isalso used in pharmaceuticals as a sleeppromoting supplement and an irrigating
fluid.

❸ Hexamethyldisilazane
Hexamethyldisilazane is used as a surface
treating agent for semiconductor siliconwafers, thereby contributing to economic
growth and industrial development.

❻ Isoniazid
Isoniazid is used to treat tuberculosis not onlyin Japan, the United States and Europe but
also in many developing countries, helping
safeguard people's health and livelihoods.

❹ Triisopropylsilylacrylate
Triisopropylsilylacrylate is used to makeantifouling boat-bottom paints which are
not harmful to marine life, contributing to
the goal of protecting life below water.

❼ Protamine sulfate
Protamine sulfate is a medication that is used
to reverse the effects of heparin and is alsoutilized as an additive for insulin preparations,protecting the lives of patients all over theworld.

❺ 2-Vinylpyridine
2-Vinylpyridine is used in tire cordadhesives, supporting the automobile
society and contributing to a comfortable
lifestyle.

❽ Trifluorothymidine
Trifluorothymidine is used as an active
ingredient in antiviral agents to treat infectionsof the eye and as an active ingredient in
anticancer drugs, safeguarding the health ofpatients around the world.

❷ β-alanine
β-alanine forms a part of vitamin B5(calcium pantothenate) which is added topetfoods and is also used as a supplement
for increasing muscle endurance.

❾ Active pharmaceuticalingredients (APIs) for generics

6 | CSR REPORT 2022

APIs for generics help reduce patients'
medication costs and improve government
health spending efficiency, helping maintainthe prosperity of society.

Intellectual Property
We are focusing our efforts on developing manufacturingmethods for synthetic organic compounds with specificphysical properties. Here we are also working to ensurethat we protect our investments by strategically securing
intellectual property rights.
Number of patentregistrations

FY2021
Number ofapplications Acquired Pending

Japan

Overseas(Japan and overseas)

Patents

6

1

10

16

6

Trademarks

1

9

1

13

2

WebsiteInvestor relations
information

Click!

All the latest
information about
our company as well
as more detailed
financial information
is available on our
website.

YUKI GOSEI KOGYO

Search

https://www.yuki-gosei.co.jp/

CSR REPORT 2022 | 7

02Corporate Management
Matters on Functions of Business Execution, Auditing, Oversight, Nomination,
and Compensation Decisions (Overview of Current Corporate Governance System)

Corporate Governance
Basic Views Regarding Corporate GovernanceWe recognize that improving the soundness, efficiency and transparency of management, properly meetingthe expectations of shareholders and other stakeholders, and enhancing corporate value are fundamentals ofcorporate governance and a top priority of management.
Our basic policy is to disclose our quarterly financial results and management policies promptly and accurately toshareholders and investors and we will continue increasing corporate transparency in the future.
The basic views and basic policies described above are disclosed on our website.
Basic Views and Policies on Corporate Governancehttps://www.yuki-gosei.co.jp/governance/

We have also established a Nomination and Compensation Advisory Committee of which the chair and a majorityof the members are outside directors, in order to ensure the independence and objectivity of decisions concerning
nomination and compensation and to strengthen the Board of Directors' oversight function through such decisions.

Corporate Governance Structure
Form of organization: Company with an Audit & Supervisory Committee

General Meeting of Shareholders
Appoint/Dismiss

Reasons for Adoption of Current Corporate Governance System
Appoint/Dismiss

Appoint/Dismiss

We adopted the system described in above judging that, under this system, decisions will be made appropriately andefficiently and there will be effective management oversight.

Board of Directors
Executive
directors

Audit &
Supervisory Committee

Audit"Audit & Supervisory
Committee Members"
Coordination(including Outside Audit &Supervisory Committee Members)"Directors"

Appoint/Dismiss
Supervision

President& CEO

Reporting

Promoteactivities

Audit
Division

Coordination

Accounting
auditInternal
control audit

Management
meeting(Deliberation on
important matters, etc.)
Officers, etc.
Promoteactivities

ExecuteInternal audits

Internal Departments, Subsidiaries

8 | CSR REPORT 2022

Accounting
AuditorCooperation
and reporting

Risk Management
and Compliance
Committee

FinancialreportingInternal control
confirmation team

The Board of Directors consists of directors (excluding directors who are Audit & Supervisory Committee members)
and directors who are Audit & Supervisory Committee Members (of whom a majority are outside directors), and it
meets once a month, in principle, and holds ad hoc meetings as needed.
The Board of Directors makes decisions on matters stipulated by laws and regulations and the articles ofincorporation as well as important matters stipulated in internal regulations and it also functions as a body thatoversees management in general.
The Audit & Supervisory Committee consists of internal directors who are Audit & Supervisory Committee members
and independent outside directors, and it meets once a month, in principle, and holds ad hoc meetings as needed.
Directors who are Audit & Supervisory Committee Members express opinions as appropriate on the execution ofduties by directors and also hold regular meetings with the Audit Division and Accounting Auditor to exchange
information and opinions with them, with the aim of improving the effectiveness and efficiency of audits throughthe use of internal control systems. Internal audits are conducted by the Audit Division and the status of such internal
audits is reported on a regular basis to the President and the Audit & Supervisory Committee. The Audit Divisionalso liaises closely with the Audit & Supervisory Committee and Accounting Auditor to assess transactions that are
deemed to required readjustment or require prompt action, etc., aiming to conduct audits with reasonable care.

From left to right in the front row: Seiichiro Matsumoto, President & CEO
Keisuke Yamada, Outside Director, Audit & Supervisory Committee Member
From left to right in the back row: Tatsuya Komatsubara, Director & Executive Officer
Masahiro Kusano, Director & Executive Officer
Naotake Suto, Director, Full-time Audit & Supervisory Committee Member
Norito Ohori, Outside Director, Audit & Supervisory Committee Member

CSR REPORT 2022 | 9

Corporate Management

02

Medium-term Management Plan and Basic Policy

Risk Management

Since our founding in 1947, our executives and employees have worked together based on our corporate
philosophy "We dedicate ourselves to manufacture products valuable for the society and welcomed by all
the people making extensive use of technologies and wisdom available in every corner of the world." Under
our Medium-term Business Plan, we are pursuing a basic policy of "achieving liftoff with the continuous
market introduction of new products and development of new applications, whilst urgently generating
sales and profit in a dramatically changing operating environment, thus laying the foundations forstable operations over the coming 10 years" and implementing the five key measures outlined below. The
fundamental task of enhancing data integrity (DI) is already complete, and the upgrading of the Enterprise
Resource Planning (ERP) system is also underway.

Our risk management activities include establishing emergency manuals in case of earthquake, fire or flood inlight of lessons learned from the Great east Japan Earthquake, establishing a Business Continuity Plan (BCP) for the
purpose of continuing business operations whilst ensuring the safety of employees and their families, developing
large-scale earthquakes countermeasures, climate-related flood countermeasures, pandemic countermeasures
and BCP and providing relevant training on a regular basis.

Key Measures
Key Measures

Basic Policy

Improving quality culture

Through improvement of the quality culture, increase management
efficiency and contribute to society by means of business continuity.

Implementing workstyle reformand developing human resources

Introduce new measures to realize workstyle reform and alsoseek to enhance the development of human resources.

Turning around and rebuilding
the amino asset business

Turn around and rebuild the amino acid business and maintainand expand our leading market share of the global market.

Leverage new pharmaceutical facilities andenhance new product development structure

Leverage new pharmaceutical facilities to enhance new productdevelopment structure and expand sales.

Strengthen business basein specialty chemicals market

Seek to strengthen business base in specialty chemicals market
by building partnerships.

Numerical Targets(Million yen)

FY3/2021 (101st term)

FY3/2022 (102nd term)

FY3/2023 (103rd term)

Net sales

11,30011,80012,400Operating profit

250

370

430

Ordinary profit

220

330

400

Profit

160

180

220

ROA

1.3%

1.9%

2.3%

Compliance
Basic Policy
1.	Recognizing that good corporate compliance is essential for corporate survival, all our officers and employees
act fairly, upholding high ethical standards, and complying with laws and regulations. We also act in a sociallysensible manner, including taking a firm stance against anti-social forces, and exercise integrity in accordancewith our management philosophy and internal regulations. Through such conduct, we endeavor to establish amanagement structure which is widely trusted by society.
2.	Under a structure for promoting compliance with the Risk Management & Compliance Committee at its center,
we will strive to establish a corporate culture which is even fairer and more transparent through initiatives such as
the revision of the YGK Group Compliance Manual, enhancement of the "whistleblowing hotline" for compliancerelated inquiries and whistleblowing reports about improper conduct, and the provision of training to raiseawareness of compliance.

YGK Group Code of Conduct① We will aim to act with high ethical standards as members of society and to conduct ourselves professionally atwork.

② We will aim to develop together with society by conducting ourselves as corporate citizens.
③ We will respect each other's character and values, increase "employee satisfaction" as a company, and strive tocreate a healthy and comfortable working environment.

④ We will endeavor to conduct research and development based on outstanding technologies and provide safe,

reliable, high-quality products, to support people's lifestyles and health and wellbeing.

⑤ We will work to promote transparent and sound business activities, aiming to increase our attractiveness as acompany.

Dialogue with Shareholders and Investors
We publish information about our shareholders' meeting, timely disclosures,
IR and news releases on our website.
Investor relations information
https://www.yuki-gosei.co.jp/ir/

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CSR REPORT 2022 | 11

03

Environmental Initiatives
Prevention of Air Pollution

Basic Policy
We aim to be a "company which coexists with nature and is kind to the planet" in accordance with our basic
management policy concerning quality, safety and the environment.

Small Once-through Boiler

Reduction of CO² Emissions

This fiscal year, we upgraded the aging LNG small once-through boiler (August 2021). The upgraded small oncethrough boiler, when used in combination with the co-generation system, can demonstrate the performance of theprevious boiler at 60% capacity.
Moreover, the upgraded boiler allows more optimized operating mode settings and can therefore be expected to be
more effective in saving energy.

Since obtaining certification for our environmental management system(ISO14001：2015) at Joban Factory in 1999, we have been working to reduce
the CO2 emissions we produce from our business activities. In recent years,
we set ourselves the target of reducing CO2 emissions (Scope 1 and Scope 2
based on estimated supply chain emissions) by 50% from FY2006 by FY2030.
We are achieving our CO2 reduction target way ahead of schedule throughinitiatives implemented to date, such as switching from heavy oil toliquefied natural gas (LNG) and significantly reducing the amount ofelectricity purchased by introducing a cogeneration system in 2014. Even
after switching from heavy oil to LNG, we continued pursuing initiatives toreduce CO2; however, we understand that reducing our CO2 emissions whilst
continuing to expand our business operations will be extremely challenging.
We are exploring a solution to this problem which involves using carbon
neutral fuel, and began using carbon neutral fuel on a trial basis from FY2022.
Going forward, we will work to protect the environment and strive to becomea sustainable company through continued energy saving initiatives.

Liquefied Natural Gas
We completely switched our boiler fuel from heavy oil to liquefied natural gas (LNG), which delivers lower CO2
emissions and does not produce sulfur oxides (SOx) and particulate matter (PM).

Co-Generation System
We installed a co-generation system which uses sources of heat to produce
and supply electricity and steam, in an effort to reduce emissions of CO2.

Wastewater Incinerator
We upgraded our wastewater incinerator to an incinerator which generates
less particulate matter.

Medium-to-Long-Term Vision

Types of Waste and Treatment Capacity

100%

Waste oil

△33%
△50%

FY2021Results0%

In 2007, we replaced the heavy oil boiler used as the heat source for steam with an LNG small once-through boiler,
and we also installed an LNG cogeneration boiler and began generating our own electricity.

2006

2021

CO2 emissions

33% reduction(Compared to FY2006)

13.56m3/day

78 t/day

FY2030Target2030

FY2021 Results
Targets

Waste alkali

FY2021 Results

19,446 t

Prevention of Water Pollution
We use an activated sludge treatment system to purify wastewater from ourfactory before discharging it into public water areas.
To increase treatment capacity, we installed a membrane separation typeactivated sludge system (MBR) in March 2016, enabling more reliable
treatment and wastewater management.

Reduction Rate

38.5%

Target achieved

Trend of Energy Intensity

Changes in CO2 Emissions■ Energy consumption (crude oil equivalent (kL))■ Total amount of CO2 generated (tons)

Energy intensity

0.16730.17539,033

FY2019CO2 per unit

0.1576

2.22

8,904

9,770

18,09017,672

FY2020

FY2021FY2019FY20202.09

2.03

19,446FY2021

Capacity of Activated Sludge Treatment System

Quantity of treated water

2,400m3/day

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CSR REPORT 2022 | 13

04

Environmental Initiatives

03

Safety and Disaster Prevention Basic Policy

Reducing Waste Disposal and Conducting Recycling
Treatment of waste oil and alkali waste is performed based on a two-pronged approach: treatment by YGK itself using
its own incinerator and treatment by outside contractors.
Surplus sludge from the activated sludge treatment system is dried and turned into pellets, which are then reused asa valuable resource in the form of sludge fertilizer.
Waste plastics are reused in material recycling and thermal recycling, scrap wood is made into chips, and scrap paper
is recycled.
High-calorie waste oil is reused as a combustion improver (valuable resource).

Reduction of the Volume ofIndustrial Waste Generated

FY20196,191

FY2020■ Recycling rate (%)

6,598

FY2021

Factory Reform Activities (Safety Initiatives)

29.2
20.9

FY201917.6
FY2020

FY2021

Material Flow
INPUT

Energy(Crude oil equivalent)Our basic policy is to "Achieve safe and stable operations" and we implement safety patrols by managers andsafety and disaster prevention drills by factory employees, to achieve this policy.

Trend of Recycling ofIndustrial Waste■ Volume of waste generated (tons)

7,780

Safety and Health Initiatives

Products

The Company's Plant

9,590 t8,451kLOUTPUT

Water

Carbon dioxide

4,985,000m3

19,446 t

Raw materials

Waste

26,730 t

6,598 t*Emissions reported under PRTR system 202kg

Environmental Management Systems
To promote safety and environmental initiatives, we establish initiative
targets each year and check and verify their achievement. We utilize
ISO14001 to encourage continuous improvement.

Factory Reform Activities
At Joban Factory, we conduct all kinds of activities such as QC activities (*1), TPM activities (*2), 5S activities (*3) and
responsible care activities under the collective name of "factory reform activities." These activities consist of sevenspecialist committees chaired by the head of each department and are used as a tool for achieving our annual factory
activities plan. In addition, through overall optimization activities, we are aiming to achieve our goal of "improving
quality culture." We have also established a Factory Reform Taskforce to coordinate and oversee all activities andreview activities once every quarter.

① Factory Reform Committee
	The Factory Reform Committee fosters a quality culture (factory reforms) by identifying, solving and sharing
information about problems and risks associated with factory facilities and operations through 5S activities
involving all members.
② EHS(*4) Committee
	The EHS Committee aims to realize a safe, secure and comfortable workplace and to eliminate accidents atwork and environmental problems by identifying potential risk factors and making improvements.
③ Specialist Maintenance Committee
	The Specialist Maintenance Committee is responsible for increasing equipment maintenance awareness andmaintenance skills and preventing losses due to sudden breakdowns and suchlike through periodic maintenancethroughout the lifecycle of equipment and tools.
④ Operational Improvement Committee
	The Operational Improvement Committee reviews operations to completely eliminate loss, and increases
operational efficiency and improves performance to stabilize production.
⑤ Industrialization Committee
	The Industrialization Committee uses lean startup methodology to enable swift startup for new products andimproved versions of existing products.
⑥ Skills Improvement Committee
	The Skills Improvement Committee organizes skills improvement training for Joban Factory employees aimed atdeveloping human resources who can think and act independently, establishing a system of training programs,
etc. for "transforming the workplace through the development of human resources."⑦ GMP(*5) Committee	In line with its mandate of "providing products that meet with high levels of customer satisfaction to customers inJapan and overseas," the GMP Committee strengthens corrective measures and preventive measures, aiming forcompliance with international quality assurance standards.
*1 QC activities are activities aimed at improving the quality of products and improving the quality of work.
*2 TPM activities promote management aimed at boosting productivity in manufacturing.
*3	5S activities aim to maintain the quality of the work environment through Seiri, Seiton, Seiso, Seiketsu and Shitsuke (Sort, Set in order,
Shine, Standardize and Sustain).
*4 EHS is a management approach integrating environment, health and safety.
*5 GMP are standards for manufacturing control and quality control.

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Safety and Health Initiatives

04

Safety and Health

Quality Policy

At Joban Factory, we are dedicated to maintaining safe and stable operations day in, day out, in accordance with
the Joban Factory Safety Policy.

Joban Factory Safety Policy
Basic Policy: Workplace safety management based on a back-to-basics approach
Priority Goal: Achieve zero accidents through daily efforts and responsible behavior
The Safety and Health Committee and the EHS Committee, which forms part of our Factory Reform activities, play
central roles in implementing measures and training related to safety and health.
In safety-related activities, we established a liaison meeting to promote safety and environmental initiatives under
the EHS Committee and we are striving to ensure safety through initiatives such as utilizing near-miss information
submitted by each workplace, making employees more sensitive to danger through hazard prediction training,
addressing risks associated with non-routine work, and providing training for dealing with emergency activities.
Every year, we also provide training to increase our employees' sensitivity to danger through the use of outside
seminars and suchlike; however, this training was cancelled in FY2021 due to the COVID crisis.
In safety patrols held once a month, we patrol factory premises to identify any problems or hazards and encourage
employees to implement safety measures.
In health-related activities, we implement measures with particular focus on promoting healthy lifestyles,
implementing and stepping up measures to improve mental health, and measures to prevent overwork.
In addition, every year, during National Safety Week in July and National Industrial Health Week in October, weformulate plans based on the implementation guidelines and conduct activities aimed at improving workplace safety
and health.
However, in FY2021, three lost-time injuries occurred. We used the 5 whys technique to properly investigate thecause and implement adequate countermeasures to prevent such work accidents from occurring again.
Through activities such as these, we will continue promoting safe and stable operations.

Lost-time injury
frequency rate

Lost-time injury
severity rate

3.8

FY20190.113
2.09

FY2020

FY2021❶ Improving quality as an organization by fostering a quality culture❷ Contributing to society through business continuity❸ Developing human resources through regular training and thoroughly

implementing the 5S methodology❹ Reducing Muri (overburden), Muda (waste), and Mura (unevenness) inoperations through systemization and allocation of resources to necessary
operations❺ Maintaining stable supply by reducing deviations and building trustwith customers

New Product Safety Inspections
We implement new product safety inspections based on domestic and foreign laws and regulations and our own
voluntary standards to ensure the safety of the products we supply to customers. When launching new products,
we conduct stringent inspections covering all aspects including safety data sheets (SDS) and intellectual property
rights.

Logistics Safety

5.8

1.8

To realize our basic policy of "achieving liftoff with the continuous
market introduction of new products and development of new
applications of existing products, whilst urgently generating sales andprofit in a dramatically changing economic environment, thus laying
the foundations for stable operations over the coming 10 years," we arefocusing on the following priority areas.

2021

national
average

0.012

0.009
FY2019FY2020

FY2021

0.09
2021

national
average

EHS Initiatives
Our basic environmental philosophy is that
"we believe we have a responsibility to society to protect and continuously improve the environment in all
aspects of our business activities and products based on our corporate philosophy “We dedicate ourselves
to manufacture products valuable for the society and welcomed by all the people making extensive use oftechnologies and wisdom available in every corner of the world,” and we aim to be a company which "coexists
with nature and is friendly to the planet." Every one of us will act responsibly based on in-depth knowledgeof and insights into the environment, economy and society and contribute to therealization of a sustainable society."

For all products, we prepare SDS and provide information about hazards required by users. In addition, to ensure
safety and protect the environment during the use and transportation of products, we ensure our products arelabelled with hazard information, emergency measures and GHS aligned labels, and also ensure logistics safety
through the use of yellow cards, thereby fulfilling our social responsibilities as a chemicals manufacturer.
* GHS: The Globally Harmonized System of Classification and Labeling of Chemicals was issued as UN Guidelines in July 2003. GHS
classifies the hazards of chemicals according to certain standards and GHS labelling uses easy to understand pictograms, etc. which
when used to communicate hazards on a label or SDS help to prevent accidents and protect human health and the environment.

Logistics Accident Prevention
When a logistics accident occurs, it is mandatory to submit a report and by implementing our own quality
assurance system to investigate the cause of accidents and prevent a recurrence, we endeavor to prevent logistics
accidents. Furthermore, through regular audits focusing on environment and safety, quality assurance and quality
control, conducted in collaboration with logistics companies, we share information and provide training about
logistics accidents.

We implement a range of measures to realize this philosophy, including obtaining
ISO14001 certification in 1999.As a result of such activities, in assessments in Sedex/
SMETA audits and EcoVadis audits, we have been highly rated based on global
standards for the environment, health and ethics. We have also received favorable
results in EHS audits by other external organizations. We will continue actively
responding to requests for the provision of EHS-related information and meeting EHSrelated auditing requirements, all of which are likely to increase in the future.

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05

Engagement with
Local Communities

Food Loss Initiatives
Striving to Eradicate Food Loss and Hunger
Japan generates approximately 6 million tons of food loss a year, 5%(approximately 300,000 tons) of which is said to be generated by convenience
stores (calculated with reference to the Ministry of the Environment's
summary of information released about the amount of food waste generated
and its control, etc. at supermarkets and convenience stores). When added
to food products, the glycine we produce can be expected to extend their
shelf life. We will continue striving to solve the problem of food loss throughthe development of applications of shelf-life extending glycine and its stablesupply.

Donations
Donations to Japan Anti-Tuberculosis Association
Responsible for making the active pharmaceutical ingredient of antituberculosis agents available to people all over the world since 1952, we
make a donation to the Japan Anti-Tuberculosis Association's double-barredcross seal campaign every year.

Seal boySponsorship
Support for Regional
Environmental Activities
We support and sponsor on an ongoing basis the
MINYU ECO TSUSHIN environmental plan and the
Fukushima SDGs plan for the development of asustainable society of THE FUKUSHIMA MINYUSHIMBUN.
THE FUKUSHIMA MINYU SHIMBUN,

October 29, 2021

Support for Regional Development
We agree with the vision of Iwaki FC and are an official sponsor of the club.

Preservation of Regional Natural Environments
Weeding the River Bank
Every year, we weed the river bank of Fujiwara River (Class A River) whichruns along the side of Joban Factory, to help maintain the regional landscapeand protect the environment.

Picking Up Trash on Public Roads
We endeavor to keep the public roads around the Joban Factory, which arealso used by the local children to get to school, clean and presentable.

CSR REPORT 2022
Published by: YUKI GOSEI KOGYO CO., LTD.
10-4, Nihonbashi-Ningyocho 3-chome, Chuo-ku, Tokyo 103-0013
Printed using environmentallyfriendly "waterless printing" that
does not produce hazardous
liquid waste.

18 | CSR REPORT 2022