The Japan Steel Works Group Basic Sustainability Policy
Based on its Purpose, “Material Revolution™, making the world sustainable and prosperous,” JSW Group will contribute tostakeholders as follows through the development and implementation of industrial machinery and new materials that solve social
issues, and simultaneously realize the creation of social value and the sustainable enhancing of corporate value.
For our customer and society
Through our supply of highly reliable products that emphasize quality, we aim to solve the problems faced by customers andsociety, and to realize a sustainable and prosperous society.

Sustainability
Management

For the global environment
We will strive to reduce the environmental impact of our business activities and the entire supply chain and contribute toenhancing a circular economy and curbing a climate change.
For our people working together
We respect human rights and provide a healthy, safe, and open working environment where everyone can find their work rewarding.
For our business partners
Through fair and equitable transactions, we create social value together and build partnerships for co-existence and co-prosperity.
For local communities
We engage actively in community involvement activities and contribute to community development as a good corporate citizen.
For shareholders and investors
We will ensure the transparency, soundness, and efficiency of management, and strive to continuously improve corporate value.
In addition, we will strive to disclose appropriate corporate information in a timely and appropriate manner.

Message from the Director in Charge of Promoting ESG
In November 2022, we established a new corporate philosophy for JSW Group, starting with the Purpose, and identified six key
issues, or Materiality, as priority items to be addressed to realize the Purpose. By clarifying these, we were able to reaffirm thechallenges that need to be undertaken to realize the future and mission we would like to realize, as well as the very reason for
the Group’s existence.
Furthermore, we are making steady efforts to organize and build a framework for sustainability management, including byexpressing our support for the recommendations of the TCFD, establishing our Human Rights Policy, and enhancing our Basic
Procurement Policy.
Amid ongoing environmental changes for our business, we will use thisframework as a basis for speedy action going forward. In addition, we intend to
set KPIs related to our Materiality in our next medium-term management plan,
JGP2028, which is currently being formulated.
Looking ahead, we aim to further enhance our corporate value by leveraging
our core competencies to solve social issues through products, technologies,
and services relied upon by all.

In putting the above into practice, we will strive to ensure compliance and work to enhance corporate governance.

Governance and Promotion System for Sustainability
Sustainability promotion activities are carried out by the ESG Promotion Committee, which was established in April 2021 andchaired by the Director in charge of Promoting ESG. In addition to considering strategies related to climate change, the committee
also discusses all manner of ESG-related issues. The Board of Directors exercises appropriate oversight on the basis of input suchas reports on the ESG Promotion Committee’s activities.
In April 2022, the Company established the ESG Promotion Office as an organization dedicated to promoting ESG activities on
a company-wide basis. The ESG Promotion Committee plays a central role in the Group’s climate change response and ESGrelated activities, which are promoted through the ESG Promotion Office in cooperation with head office divisions, businessdivisions, plants and Group companies.

ESG Activities Promotion Organization Chart

Junichiro Deguchi

Board of Directors

Representative Director & Executive Vice President
In charge of Export Control Administration; In charge of CSR & Risk Management,
In charge of Promoting ESG, In charge of Environmental Management,
In charge of General Affairs Department,
In charge of Material and Engineering Products Business

Inside Directors

Supervise

Outside Directors

Report

ESG Promotion Committee

Foundations for Creating Value: Table of Contents
Environment

SocialGovernance

36 Environmental Management

40 Quality Management

48 Corporate Governance38 Response to Climate Change

42 Human Resources Strategy

54 Management Team

39 Reduction of Environmental
Impact45 Occupational Health and Safety
46 Human Rights

56 Message froman Outside Director

46 Local Communities

57 Risk Management

47 Supply Chain Management

58 Compliance

Plan (target setting)
Check (monitoring)

Chair: Junichiro Deguchi, Director in charge of Promoting ESG
and Representative Director & Executive Vice President
Office: ESG Promotion Office
ESG Promotion Office(newly established on April 1, 2022)

Do (implementation of measures)
Action (review of activities)

Head Office
Divisions

Business
Divisions

PlantsGroup
Companies

59 Information Security
34 JSW Integrated Report 2023

JSW Integrated Report 2023 35

Environmental Management

Environmental Policy

Targets and Progress of the Medium-Term Environmental Plan
Achievement Level:

JSW Group is committed to being an environmentally responsible corporate citizen. We emphasize environmentally responsible
production and technology as means to support sustainable social development in harmony with ecosystems.

Priority Issues

Shared Business Site Policies

	
Systematically implement environmental initiatives and1

Business sites set environmental policies, objectives andgoals in accordance with international standards with due
consideration of their operations and nearby communities.

	
Set appropriate objectives and targets to reduce2environmental impact, including on biodiversity.

	Provide society with products and services that contribute3
to environmental conservation.
( 1 ) Improve the social value of our products in terms of the		
environment, health and safety.
( 2 ) Provide products and services that reduce environmental		
impact by understanding environmental needs anddeveloping technologies.

( 3) Use resources more productively by saving energy and by saving	and recycling resources.
( 4) Require employees and on-site companies to understand and	abide by business site policies.

Environmental Management Structure

Maintain existing ISO 14001 certifications
Obtain new ISO 14001 certification ofdomestic manufacturing Group companies

33.75% reduction in CO2 emissions(compared with fiscal 2013)

41.9% reduction in CO2 emissions(compared with fiscal 2013)

60% reduction in CO2 emissions by the endof fiscal 2030 (compared with fiscal 2013)
45% reduction in CO2 emissions by the endof fiscal 2025 (compared with fiscal 2013)

Improvement of 1% or more in energy
usage intensity(year-on-year and average change in
intensity over 5 fiscal years)

15.5% improvement over the previous year
3.0% improvement over average change in
intensity over 5 fiscal years

Improvement of 1% or more in energy usage
intensity (year-on-year and average change
in intensity over 5 fiscal years)

Promotionof Resource
Conservation
and Recycling

Recycling rate of 95% or higher(excluding slag and refractories)

Recycling rate of 95.2%(excluding slag and refractories)

Recycling rate of 95% or higher(excluding slag and refractories)

Managementof Chemical
Substances

Improvement of 1% or more emissions
and transfers intensity of chemical
substances subject to the PRTR* law(year-on-year and average change in
intensity over 5 fiscal years)

15.5% improvement over the previous year
Improvement of 1.9% in the averagechange in intensity over 5 fiscal years

Improvement of 1% or more emissions andtransfers intensity of chemical substances
subject to the PRTR law(year-on-year and average change in intensity
over 5 fiscal years)

Legal or regulatory violations: 0

Legal or regulatory violations: 0

Legal or regulatory violations: 0

Treat low-concentration PCB waste by
the legal deadline (March 2027)

Progressing appropriately

Treat low-concentration PCB waste by thelegal deadline (March 2027)

Issuance of integrated reportIssuance of integrated report

Disclose environmental management
activities in an integrated report
Conduct training for employees

Climate Change
Measures

Compliance

Recognizing the importance of conducting its business activities in harmony with both the international and local communities,
JSW Group has been promoting environmental management activities throughout the Group since 1997. The Environmental
Management Committee, headed by the director in charge of environmental management, formulates group-wide annual
environmental management policies and action plans, and monitors and evaluates the progress of environmental management

Achievement
Level

Less than 80% achieved

Medium-Term Environmental Plan
(under JGP2025)
Fiscal 2025 Targets

Maintained ISO 14001 certification of plants
and Nikko-YPK Shoji( 1) Comply with laws, regulations and JSW Group agreements with	
external entities.
( 2) Prevent pollution and reduce and properly process waste with	
due consideration for impact on ecosystems.

Fiscal 2022 Actual Results

80% or more achieved

Maintain ISO 14001 certification ofplants and Nikko-YPK Shoji

Environmental
Management

Action Plan
continuously promote environmental conservation.

Fiscal 2022 Targets

Fully achieved

Raising
Environmental
Awareness* PRTR: Pollutant Release and Transfer Register

activities. Each plant has its own environmental supervisory committee and works to promote environmental management
activities, as part of JSW Group’s unified approach to reducing its environmental impact.
Environmental Management Committee

JSW Plant Environmental Supervisory Committee
JSW Plants(Hiroshima, Yokohama, Meiki)

President

Chief Environmental
Management Supervisor(Director in charge ofEnvironmental Management)

Environmental
Management
Administrative OfficeEnvironmental
Management Supervisors(JSW Plant Managers)

Environmental
Management Officers(President,
Japan Steel Works M&E, Inc.)

Renewable Energy Use Initiatives

The fiscal 2022 environmental impact of the manufacturing

energy used, the Group has set the target at 25% or more byprocesses of the Industrial Machinery Products Business and

JSW plants
affiliated companies

the Material and Engineering Business is as indicated below.

Environmental
Management Officers

Muroran Plant
M&E affiliatedcompanies

such as energy and intake water, and outputs, such aswaste generated in manufacturing processes, carbon dioxide
and waste water, and applies those in its environmental

Materials

Business Site

Original Certification Date Current Certification Body

MANUFACTURING

in fiscal 2022.

Metals, rubber,
timber, etc.

2,728 TJ

In addition, there is active rebuilding and expanding of

7,128 tbuildings at the Hiroshima Plant with an aim to achieve
generation equipment in all new buildings. The total capacity

16.16 million m

3

Industrial machinery products
Materials and engineering products

renewable energy sources.

December 18, 1998

JQA

ISO 14001 certification, an international standard

Yokohama Plant

September 4, 2006

JQA

CO2 (Scope1+2)

for environmental management systems.

Meiki Plant

March 4, 2005

JQA

148,425 t

Japan Steel Works M&E

December 18, 1998

LRQA

Nikko-YPK Shoji

February 7, 2005

JQA

* Certification bodies: LRQA (Lloyd’s Register Quality Assurance Limited), JQA (Japan Quality
Assurance Organization)

Intakewaterof all installations as of fiscal 2022 is 400 kW.

Hiroshima Plant

36 JSW Integrated Report 2023

Chemical
substances(of which 5.3% renewable energy)

Inc. and Nikko-YPK Shoji Co., Ltd. have obtained

OUTPUT

derived from renewable energy sources. Use of renewable

JGP2025, and plans are in place to install solar power
Energyand Group companies Japan Steel Works M&E,

the Hiroshima Plant, Yokohama Plant, and Meiki Plant isenergy sources covered 5.3% of the Group’s total energy use

INPUT

Business Site ISO 14001 Certification

fiscal 2030.
Hiroshima Plant, but a portion of the electricity purchased at

improvement activities.

Head OfficeEnvironmental
Management Division

the end of fiscal 2025 and 40% or more by the end of
Not only do we conduct solar power generation at the

JSW Group carries out quantitative assessments of inputs,

Head Office
General Manager,
Corporate Planning
Division

JSW’s Hiroshima, Yokohama and Meiki plants

In terms of the percentage of renewable energy sources in all

JSW plants

Japan Steel Works M&E
Environmental
Management Supervisor

Business Activities andEnvironmental Impact

Total waste volume

84,061 t

We will continue initiatives toward increasing the use ofChemical substances(amounts emitted and transferred)

Waste water

214 t

16.16 million m

Waste emission
volumeFinal waste
disposal volume

41,577 t

325,371 t

Waste recycling volume

Waste recycling ratio

58,690 t

70%
JSW Integrated Report 2023 37

Response to Climate Change

Indicators and Targets

Support for the TCFD recommendations

Strategy
Financial “Risk” Impact Assumed for FY2030

Financial “Opportunity” Impact Assumed for FY2030

200,000(%)

100,000

140,570 102,233

0
2013

2018

(benchmark year)

CO2 emissions (left axis)

2019

2020

2021

2022

60
40

192,630 188,551
161,972 162,229 148,425

2025

Target20
0〜Classification

CO2 emissions reduction target

255,582〜

Climate change response: https://www.jsw.co.jp/en/sustainability/environment/climatechange.html

45% reduction 60% reduction
by the end of by the end of
FY2025
FY2030(compared with FY2013)(t-CO2/year)

300,000〜

JWS Group considers climate change as one of the important management issues, and in June 2022, we have expressed ourendorsement for the recommendations of the TCFD (Task Force on Climate-related Financial Disclosures). In the same year, we
completed a scenario analysis and impact assessment. In accordance with the TCFD’s disclosure framework, we analyze andconsider the impact of climate change-related risks and opportunities on the Group’s business activities and earnings, anddisclose the resulting information.
Please refer to our website for details.

The “Indicators and Targets” that measure and manage risks
and opportunities related to climate change have set thefollowing targets for a carbon-neutral decarbonized society.
We are engaged in environmentally friendly business activities
that aim for improvement in terms of both “decarbonization by
products” and “decarbonization of production processes.”
Regarding the CO2 emission reduction target, we haveinitiatives underway from Scope 1 and Scope 2. As Scope 3
emissions are being calculated, we are proceeding with efforts
toward setting publication and management indicators.

CO2 Emission (Scope 1, 2) Reduction Plan and Renewable Energy
Introduction Plan

2030 (FY)

TargetPercentage of renewable energy introduced (right axis)* In terms of the scope covered, the CO2 emissions calculation includes the totalof the head office and the Group’s main manufacturing sites (Hiroshima Plant,
Yokohama Plant, Meiki Plant, Japan Steel Works M&E, JSW Aktina System).
Target (by end of year)

Management Indicator

2025

2030

Reduction of CO2 emissions in production activities(Scope 1, 2)CO2 emissions reduction rate (compared with FY2013)

45% reduction

60% reduction

Promotion of the introduction of renewable energy

Percentage of renewable energy among all energy used (Scope 1, 2)

25% or more

40% or more

Degree of
Impact2˚C

Policies andregulations
Technology
Transition risks

Details
Imposition of a carbon tax
Introduction of border adjustment tax
Cost of switching fuels at production
facilities and R&D
Decrease in demand for the products
due to the reduction in the constructionof conventional thermal power plants

Markets

Reputation

Category

Type

4˚C

Major

–

–

Moderate

Moderate Moderate
Minor

–

Increased procurement costs due toincreased demand for steel-making raw
Moderate Moderatematerials as a result of the shift fromblast furnaces to electric furnaces
Damage to our ESG evaluation andreputation due to delays in CO2emission reduction measures at the
product manufacturing stage

Response to carbon taxes
In the 2˚C scenario, we assume a carbon tax of 120 USD/t-CO2.
In order to reduce the financial impact of taxation, the Groupis working to introduce electricity generated from renewableenergy and install solar power generation facilities, in addition
to taking various energy conservation measures.
In fiscal 2022, we have increased the percentage ofelectricity generated from renewable energy sources to 30%
of Scope 2 at the Hiroshima Plant, 16.3% at the Yokohama
Plant, and 20% at the Meiki Plant. Furthermore, the Hiroshima
Plant once again expanded its solar power generation facilities
in fiscal 2022, following expansion in fiscal 2021.
•

 esponse to decreasing demand for thermal powerR
related products due to the reduction in theconstruction of conventional thermal power plants
The market is shifting to prefer power generation facilities
with technologies that curb CO2 emissions. Specifically, thispower generation takes place in ultra-supercritical andultra-high-temperature environments, and the requirementson these are ever-evolving. The Group has been consistently
pursuing research and development to address theserequirements. These efforts have resulted in ongoing strong
orders for products related to power generation, following
the shift to higher-efficiency gas turbine combined cycle
power generation.

Details

Degree of
Impact2˚C

4˚C

Expansion of the EV market

Major

Major

Expansion of power electronics market
and 5G infrastructure market

Moderate Moderate

Energysources

Increased demand for renewableenergy power generation

Moderate Moderate

Resource
efficiency

Tax relief after the introduction ofcarbon pricing on CO2 emissions fromproduction facilities

Major

–

Expansion of products and services
that contribute to the demand for the
reduction of CO2 emissions

Major

Major

Minor

Minor

Response to the demand for plastic

Products andrecycling, contribution to social
services
implementation of non-fossil-fuel-Moderate Moderate

Specific Initiatives to Address Risks

Type

Markets

Opportunities

Category

Impact on operating income: Minor: less than ¥100 million/year; Moderate: ¥100-1,000 million/year; Major: ¥1,000 million/year or morederived plastics

Response to the demand for nuclear
power plants

Moderate Moderate

Specific Initiatives to Address Opportunities
Initiatives for increased demand for renewable energy
power generation
With greater introduction of renewable energy around theworld, there has been a marked increase in demand for resinsused for encapsulation of photovoltaic panels, such as
ethylene vinyl acetate resin. Demand for pelletizers, the mass
production equipment used for this kind of resin material, is
expected to remain at a high level going forward.
To meet demand, we will advance our investment plan at
the Hiroshima Plant to increase the production capacity andefficiency of these large pelletizers and to improve theassembly capacity of large pelletizers.
For details, please refer to p. 22-23.
••

38 JSW Integrated Report 2023

Response to the demand for nuclear power plants
Nuclear power capacity is expected to trend upward in themedium to long term as nations transition toward policies
emphasizing energy security and decarbonization. We will
provide the appropriate products to the market by leveraging
our extensive development and manufacturing technologies inlarge cast and forged steel components for nuclear power
plants (reactor pressure vessel components, turbine rotor
shafts, and generator shafts) and our knowledge of nuclear
power standards in various countries.
For details, please refer to p. 28-29.
•

Reduction of Environmental Impact
Policy and Initiatives for Water Resources
JSW Group recognizes that climate change and population growth are causing water resource shortage problems in regions allover the world.
The Group utilizes the World Resources Institute’s (WRI) Aqueduct assessment tool and other tools to check water stress at its
manufacturing sites. As of July 2023, our assessment indicates that the Group has no manufacturing sites in water-stressed
areas.* Japan Steel Works M&E, which accounts for more than 99% of the Group’s water withdrawals, is located in Japan’s
Hokkaido Prefecture, where water stress is rated as Low in both Aqueduct’s
current assessment and future projections. At Japan Steel Works M&E, we
Intake Water Consumption
are working to reduce freshwater intake by recycling cooling water after use(Million m3/year)
20
and utilizing sea water, and are also practicing water source management for
16.33 16.86 16.28 16.91 16.16
some industrial water used. We will continue to regularly check the water
15
stress at Group manufacturing sites and strive to use water resources
10
appropriately considering the water stress level.
5
In terms of waste water quality, we will continue to conduct strict water
quality management based on government ordinances.
02018*Areas rated with High or Extremely High water stress by Aqueduct

Proper Management of Chemical Substances
At JSW Group, we manage chemical substances and other substances withenvironmental impact and are working to reduce emissions of hazardous substances.
Based on the PRTR Law, we report to local governments annually about our releaseand transfer of the substances that are subject to that law. Substances that are
subject to the PRTR law are used primarily in manufacturing processes, such as steel
manufacturing, welding, galvanization, cleaning and coating.

2019

2020

2021

2022 (FY)

Release and Transfer of PRTR Substances
FY2021

FY2022

Amountreleased (t)

65.1

59.2

Amounttransferred (t)

161.0

154.3

Total (t)

226.1

213.5

Initiatives to Reduce Waste
JSW Group is working to reduce waste volumes founded in
3Rs of waste: Reduce, Reuse, and Recycle. Our Industrial
Machinery Products Business is maintaining a high recycling
rate through thorough implementation of 3Rs of waste. Our
Material and Engineering Business is contributing to therealization of a recycling-oriented society by utilizing internaland external steel scrap as raw materials.

Industrial Machinery
Products Business

Material andEngineering Business

FY2021

FY2022

Waste final disposal
volume (t)

124

101

Recycling rate (%)

98.7

99.2

Waste final disposal
volume (t)20,94325,270Recycling rate (%)

72.2

64.7

JSW Integrated Report 2023 39

Quality Management

Progress to Date
1

Customer relations and acquisition of certifications at M&E
 &E temporarily suspended manufacturing, shipment, and new order acceptance for principal products where inappropriate conduct
M
was confirmed in fiscal 2022, prioritizing its response to customers, but resumed manufacturing, shipment, and new order acceptance for
products where quality and manufacturing processes were successively confirmed as sound (substantially remedied as of the end of fiscal
2022). Nuclear products are undergoing quality assurance verification processes by certain customers, and manufacturing has resumed for
products approved by customers.
• Suspended ISO manufacturing certifications were reinstated in March 2023. Revoked certifications were re-certified to ISO 9001 in August
2023, and re-certified by a testing laboratory under ISO/IEC 17025 in September 2023.
•

Summary of Circumstances Surrounding Inappropriate Conduct in ProductQuality Inspections
In May 2022, the Company announced that a subsidiary, Japan Steel Works M&E (hereinafter, M&E) had engaged in inappropriate
conduct, including falsifications, fabrications, and misstatements of product inspection results. Subsequently, we have taken withthe utmost seriousness the findings and recommendations of a special investigation committee, consisting of outside attorneys,
and are continuing efforts to prevent recurrence. Please refer to the URL below for details of the inappropriate conduct and thefindings and recommendations of the Special Investigation Committee.

2

 ay 2022: Non-reappointment of one director with past experience as an executive director of the Material & Engineering Products
M
Business, and resignation of one Audit & Supervisory Board member were accepted.
• November 2022: Monthly salaries of the eight executive directors and executive officers serving when inappropriate conduct occurred werereduced in line with their responsibilities.
To clarify management and supervision responsibility, the Company reduced monthly salaries or took disciplinary action (including demotion)
against officer- and manager-level employees (including those seconded from the Company to M&E) in line with their responsibilities, andpublicly announced the disciplinary action internally and on M&E’s website.
•

In Response to Inappropriate Conduct in Quality Inspections by Our Subsidiary
https://www.jsw.co.jp/news/news_file/file/20230509_news_en.pdf

3Roadmap to Prevent Recurrence, and Progress Status

Situation (as of
October 2023)

FY2024

Established Quality Management Office (September 2022)

Complete

Plant quality audits (biannual) and affiliated companies audits (annual) by the Quality Management Office
Established Quality Assurance Division reporting directly to the President, M&E (June 2022)

Complete

Consolidated product division delivery and cost control functions in the Production Management Department (January 2023)
Quality audits by the Quality Management Office (minimum biannually)

Complete

President’s employee lunch meeting (monthly)

Ongoing

President’s site inspection and town hall meetings with employees (monthly)

Ongoing

Quality Compliance Month (annually, May)

Subdivide M&E regular meetings (completed) to stimulate discussion with wider range of young employees

Ongoing

Self-assessment to foster a culture of product safety (annually, February)

Ongoing

Established Purpose (November 2022)

Complete

Promote Organizational Culture Reform Project

Ongoing

Enlarge scope of application (deploy across Company)

Appropriate investment of management
resources in quality control

Increase quality control personnel, promote personnel mobility (multi-skills training, promote rotation)

Revision of standards for the storage of
quality-related documents and data

Quality Assurance Group reconciliation of inspection/test source data with final results

Ongoing
Ongoing

Capital investment to enhance inspection operations efficiency (renew inspection equipment, consolidate inspection stations, automate and digitize inspections)

Ongoing
Ongoing

Define retention period of inspection records (original data and submitted rating form) in Quality Manual

Quality Control Framework
In June 2022, a Quality Control Department was established, reporting directly to the president, M&E. In September 2022, tostrengthen corporate monitoring and supervisory functions, the Quality Management Office was established to oversee quality
assurance at each business division and manufacturing plant. To ensure personnel control, the managers in charge of quality
control at each manufacturing plant, including M&E, are incorporated as concurrently serving in the Quality Management Office.
In January 2023, delivery and cost control functions were separated from M&E’s product departments and brought under
Production Management Department. A Muroran Branch of the Quality Management Office (staffed by a full-time employee) wasestablished to further strengthen supervision, guidance, and mutual monitoring.
General Meeting of
Shareholders

Complete (in operation)

Strengthen in-production monitoring by Quality Assurance Division (e.g., unannounced inspections, monitoring, etc.) Complete (in operation)

Board of Directors

Review internal quality audit procedures (e.g., random sampling of construction documents on day of audit) Complete (in operation)

Complete (in operation): Overall JSW Group measures: M&E-specific measures

The Japan Steel Works

40 JSW Integrated Report 2023

Engineering Services Department

Strengthen board structure (perform more monitoring, boost proportion of outside directors, ensure diversity)…

Concurrently
serving
Material Products Department

Complete (in operation)

Muroran Plant

Production Management
Department

Strengthen internal whistleblower system (further publicize system, etc.)

Quality Control Department

General Affairs Department

Complete (in operation)

Muroran Branch (staffed bya full-time employee)…

Testing and Analysis Center

Strengthen internal audit function (timely operational status audits of the Quality Management Office by head office Internal Auditors Office)… Quality Management OfficeInternal Auditors Office

Supervision andguidance

Inspection Group

Ongoing
Complete (in operation)(Quality Assurance Department
General Manager, M&E)

Strengthen Board of Directors monitoring function

Clarify characteristics of customer requirements (concerns about requirements, if any, to be discussed with customer through to resolution)
Review internal pre-inspection and testing operations (such pre-inspection and testing to be described clearly in specifications, with records disclosure upon request)(Quality Assurance Department
General Manager, Hiroshima)Strengthen internal controls

President

Ongoing*Concurrently serving as General
Manager in charge (Hiroshima)

GovernancereformPresident

Ongoing

Management evaluation/approval of order acceptance/rejection (order acceptance/rejection based on appropriate judgment)

Quality Assurance Group

Permanent posting of Quality Management Office member to M&E

Upgrade communication with customers

Board of Directors

Strengthen involvement of Quality Assurance Group (approval and review at each stage of nonconformity reporting, action orders, outcome confirmations) Complete (in operation)

Dedicated Office staff: 2
Deputy Office Manager: 2
Office Manager: 1 (director in
charge of quality management)

Strengthen quality assurance process

General Meeting of
Shareholders

Audit & Supervisory Board
MemberAudit & Supervisory Board*Concurrently serving as General
Manager in charge (Muroran)

ProcessreformOngoing

Establish an inspection operation system to digitize inspection and test record preparation
Partial system launch

Ongoing(Ordnance Quality Assurance
Department General Manager,
Hiroshima)

Digitize inspection work

Ongoing*Concurrently serving as General
Manager in charge (Ordnance)

Organizational culture reform

Ongoing(Senior management message distribution, compliance education/training)
National Product Quality
Month (annually, November)
M&E management get-togethers with frontline employees and young managers (monthly)

The Special Investigation Committee found a culture of discouraging free expression of opinions, a lack of communication
between departments, and a corporate culture that did not encourage or value taking on challenges. We recognize that this is an
important challenge, not only for enhancing quality compliance, but for innovation and corporate growth. In response, the Board of
Directors has approved a fundamental policy of pursuing initiatives to cultivate high ethical standards and a spirit of taking onchallenges, as well as psychological safety in all operations and situations.
With respect to corporate culture reform, we are formulating and pursuing measures at multiple levels, with ongoing followup
through employee surveys, engagement surveys, etc., the results of which are reported to the Board of Directors as appropriate.
In addition, we have launched an Organizational Culture Reform Project Team made up of internally recruited young employeeswith a passionate desire to reform the Group’s organizational culture. This team commenced activities in August 2023.

(Quality Assurance Group Manager,
Yokohama)

Organizational
culture reform

Complete
Ongoing

Established Quality Policy and Quality Code of Conduct (September 2022)

Strengthen and raise awareness of theneed for quality compliance

Ongoing

Culture reform initiatives*Concurrently serving as General
Manager in charge (Yokohama)

Qualityassurancesystem reform Strengthen the independence of thequality assurance function

From October 2023
to March 2024

Pending Issues and Future Response(Quality Assurance Department
General Manager, Meiki)

Establish company-wide quality
assurance system

From May 2022
to September 2023

 he Board of Directors undertook to ensure diversity by increasing the number of outside directors (independent officers). Going forward,T
we will continue to shift the functions of the Board of Directors toward a greater monitoring role, to prevent the recurrence of misconduct ingeneral.
• To strengthen our internal control functions, we established a company-wide Quality Management Office in September 2022 and appointed
a director in charge of quality management. In conjunction with separation of business execution from business division supervisory
functions, the second line function in the three-line of risk defense in risk management model was clarified, and personnel were deployed toensure effectiveness.

*Concurrently serving as General
Manager in charge (Meiki)

Measures to Prevent Recurrence

Strengthening governance•

Based on analysis of the causes of the inappropriate conduct, and after considering the recommendations of the Special
Investigation Committee, JSW Group formulated measures to prevent recurrence, and is implementing them following overall
approval by the Board of Directors. From the four standpoints of System, Culture, Process, and Governance, we are working
diligently to develop specific measures to prevent recurrence, some to be carried out by the Group as a whole and some by M&E.
Regarding implementation, the Quality Management Office as the second line leading, directing, and supervising, and the Internal
Auditors Office as the third line is auditing progress periodically and reporting results to the Board of Directors.
Category

Disposition of officers and others…

Japan Steel Works M&E

JSW Integrated Report 2023 41

Human Resources Strategy

Recruitment

Human Resource Strategies to Realize Our Purpose
To realize its Purpose while enhancing corporate value and creating social value, JSW Group must
formulate and pursue a human resource strategy contributing to strengthening human capital improvementand diversity and inclusion, which we have established as a Materiality. Based on our shared Purpose andVision, we will pursue our human resource strategy by promoting policies that focus on the organization asa whole as well as on individuals, respectively.
While organizational performance is first and foremost a function of the sum total of individual abilities,
we have defined the skills we want our personnel to acquire in the course of their careers to execute ourbusiness, and are undertaking to promote individual growth through a variety of human resource policies.
Through skills development, employees will help realize our Purpose, and by promoting an organizational
culture that encourages diverse personnel to grow and play active roles autonomously, we will generatesynergy between organizational performance and individual growth.

The portable skills that should be acquired by personnel who

sales positions. We also offer internships as an opportunity

contribute to the realization of our Purpose, are defined as:

for interns to gain work experience, and a deeper

openness to diversity, ability to identify issues, capacity to takeunderstanding of our work environment and corporate

on challenges, and autonomous learning ability. In our

culture.
Hiring of experienced personnel
To continue attracting an even larger and more diverse
workforce, we strive to hire experienced personnel. We arealso working on a new compensation system that will help us
secure core personnel with high-level expertise who can
become the leaders of the future.
In addition to general recruitment routes, we also use awide range of targeted recruiting in our search for diverse
personnel, such as employee referrals and proactively
approaching prospective candidates.

recruiting activities, we are engaged in a range of efforts tohire a diverse workforce that possesses these portable skills.

Motoyuki Shibata
Director, Executive Officer
In charge of Export Control
Administration,
In charge of Health & Safety
Management,
General Manager, Personnel
Department• Hiring of new university graduates
To obtain contact with a broad range of people from acrossthe country, we are engaged in in-person and online recruiting
activities. When recruiting personnel with a technicalbackground, we conduct on-site tours and interviews at our
manufacturing sites. When recruiting personnel with ahumanities background, we provide opportunities forroundtable discussions with young employees, particularly in

Development
Level-specific training and self-development support
We provide level-specific training for all employees, from newhires to managers. Furthermore, to support self-development,
we make online learning platforms available, and strive tocreate an environment where people can acquire the skills
they are seeking.
•Maximizing organizational performance

Individual growth and participation

To realize our Purpose, society must continue to need us.
To this end, it is necessary to maintain the JSW Group Value
Creation Process, and to enhance sustainable corporate
value while simultaneously creating social value. We recognizethat to create these types of value, we must undertake togrow as an organization that can generate innovation and link
it to value, thereby maximizing performance. Therefore, basedon the results of our group’s workforce composition analysis
and engagement survey, we are furthering a wide range ofmeasures and Organizational Culture Reform projects.

We believe that leveraging diversity and fostering a culture ofautonomous problem-solving is essential if an organization is tocreate innovation and link it to value. The most important factor
among those that determine culture is the individual abilities ofthe people making up an organization. In terms of individual
abilities, we define portable skills as basic skills that are required
for any job title or position, and technical skills as specializedskills acquired through work.
Our human resource strategy emphasizes individual growthand participation, and we collaborate with individuals at eachstage—recruitment, deployment, development, evaluation,and compensation—to develop their skills and link them toorganizational performance.

Portable skills (basic skills required for any job title/position)

Technical skills (specialized skills acquired through work)

Openness todiversity

Openness to diverse values and ideas, capable ofleveraging them to boost team performance

Ability toidentify issues

Capable of identifying and raising issues proactively
to keep the organization’s awareness of issues current

Capacity totake onchallenges

Able to take on challenges without being
constrained by precedent, and capable of involving
others in the process

Autonomous
learning ability

Capable of adapting flexibly and promptly to changes
in the environment, of learning autonomously, and ofgrowing throughout their career

Maximizingorganizational
performance

Individual
growth andparticipation

Foster a corporate culture ofleveraging diversity, of taking
on and solving challenges
autonomously
Portable skills(basic skills required for any job title/position)
Openness to diversity

Ability to identify issues

Capacity to take on challenges

Autonomous learning ability

42 JSW Integrated Report 2023

Technologicalcapacity

High-level specialist knowledge that reinforces theCompany’s core competences (melting, mixing,
and solidifying technologies)

Management
skillsAbility to maximize organizational performance andsupport management strategies and corporate
foundations

Global business Skills that enable the individual to extend and grow
the Company’s business on a global scale
skillsGrowing into an organizationthat creates innovation andCompensation Recruitment
links it with value

Evaluation

Diversity

Deployment

Development

Technical skills(specialized skills acquired through work)
Technological capacity

Management skills

Global business skills•

PurposeMaterial Revolution™
Material Revolution™,
making the world sustainable
and prosperous.

Growth support for middle-level managers
Based on the results of the engagement survey, we believethat to raise the level of performance for the organization as awhole, it is important to enhance the skills of middle-level
employees who drive the workplace as well as businessstrategy execution, in order to enable them to boost the levelof job satisfaction and desire to take on challenges felt by
employees at each workplace. As such, by designingeducational content for middle-level employees that takes into
consideration the needs of each workplace, we will support
these employees in enhancing their guidance and development
skills, and this will in turn vitalize our workplaces. We also
promote the development of personnel who are capable ofleading strategy execution without being constrained byprecedent. Consequently, we actively fast-track young highperformers into management in anticipation of futureadvancement to senior management. We task these
individuals with critical missions involving significant
responsibility, and actively conduct development programs
through internal recruitment and rotation.
•• IT skills education
All employees will be categorized into levels according to
responsibilities and IT skills, and the target percentage of
employees at each level will be set. As we work to achievethese percentages, we will formulate a system to provide
appropriate educational content to each employee, thereby
undertaking to maximize the effectiveness of efforts toimprove IT literacy throughout JSW Group. In addition to theforegoing, we will also work to develop department leaders,familiar with business as well as IT, who will promote
digitization of business operations to derive concrete resultsfrom DX activities.

Support and monetary incentive programs for technology
and skills transfer, and acquisition of official certifications
We have established in-house training environments such as
Ginou-Dojo (Technical Skills Dojo) (Hiroshima Plant) andHagane-Juku (Steel Academy) (Japan Steel Works M&E
Muroran Plant). We are transmitting skills that have been
passed down by generations of skilled technicians to younger
employees, and broadening the base of employees withtechnical backgrounds.
We also encourage employees to obtain official
certifications and reward them when they do, and haveintroduced a skills certification system to promoteautonomous learning and growth.
•• Global business skills
We offer employees educational opportunities to acquire
global business skills. In addition to improving skills such as
negotiating and presenting in English, this training also gives
participants the opportunity to learn styles of thinking thathave global resonance. Moreover, we provide the basic andspecialized education required for global business, such as
language training including study abroad, and flexible rotation
for personnel development, including to the Company’s
international locations. These efforts are fostering the humanresources who will lead the development of our business on a
global scale.
Going forward, we will begin to structure an educational
system to effect management skills acquisition, including theexpertise to formulate and execute growth strategies andestablish corresponding management structures, andknowledge of M&A.

JSW Integrated Report 2023 43

Occupational Health and Safety

Deployment
employees to the most suitable positions for businessIn addition, in fiscal 2023, we are embarking on initiatives
that will promote autonomous career development, including

execution, after consideration of their individual aptitudes andimplementing planned internal open recruitment in certain

personalities. This will ensure that all employees can exercise

divisions, with the aim of developing personnel by encouraging

their abilities and acquire technical skills (specialized abilities)
through their work.

them to take on the challenge of developing new businesses.

To deploy the right person into the right job, we assign

FY2020

FY2021

FY2022Training cost per employee(thousands of yen)

Indicators

29.8

28.5

42.9

Number of participants in job levelspecific training

285

277

266

Completion rate of job level-specifictraining (%)

98.6

98.9

98.1

Number of employees newly certified
under The National Trade Skill Test &Certification (NTSTC)

47

111

100

Policy for Health and Safety Activities
In JSW Group, which operates primarily in manufacturing, ensuring the health and safety of employees has always been a toppriority. We consider our health and safety initiatives to be part of a corporate foundation and corporate culture rooted in anemphasis on human capital and respect for human rights.
We are carrying out these activities in accordance with the policy below, with the aim of maintaining and improving the health of
employees and preventing occupational accidents.
1

Basic Philosophy

 o fulfill our social responsibility, we have positioned health and safety as a vital part of our management policy, and work toTensure the health and safety of everyone involved in our business.
• We have established and operate an occupational health and safety management system, and prioritize health and safety inall of our business activities to foster workplaces where employees can work safely and with peace of mind.
•

2

Evaluation and Compensation
Separate systems established for general employees andmanagers. Evaluation of general employees focuses on job
performance. Upon advancement to assistant manager level,
the highest general employee level, the Company sets goals
based on the individual’s scope of responsibility, andevaluates based on achievement of those goals.
Management-level employees set goals autonomously withrespect to problem solving and organizational development
linked to business objectives, and work autonomously toachieve them. Communication with supervisors is mandatory
in setting goals for managers and assistant managers. Suchcommunication reinforces the link between management andindividual goals, and ensures that all employees can exercise
their individual abilities and play an active role in furthering theorganization’s pursuit of management strategy.
Going forward, we will further clarify our goal-setting
priorities, and aim to make the system even more conduciveto the achievement of the medium-term management plan.

Basic Policy(1) We will comply with health- and safety-related laws and regulations, as well as internal standards, and steadily promote
their establishment as rules, customs, and culture.
(2) Based on strong leadership from top management, employees, the labor union, and JSW Group will work in unison toestablish a safety management system to prevent occupational accidents and health hazards.
(3) We will invest the resources necessary for effective workplace improvements.

Health and Safety Promotion Structure
The promotion structure for health and safety activities in JSW Group is as follows.
Companywide Health and Safety Council

Plant Health and Safety Committee
JSW Plant(Hiroshima, Yokohama, and Meiki)

Workplace Success for Diverse
Human Resources
The Group recognizes that the execution of its management
strategy hinges on the active participation of diverse humanresources that can bring about new added value through avariety of thinking styles and ideas.

Activities to promote diversity and inclusion
We provide onboarding training for experienced hires, toensure smooth integration and participation. We provide
advance training to departments hiring persons withdisabilities, to ensure smooth personnel integration anddepartmental understanding of the nature of the disability.
We are also developing educational content addressing
female health issues, and working to obtain support andunderstanding at each workplace.
JSW Group’s relatively low percentage of female employees
overall, and female managers in particular, presents achallenge. We have women in management positions—at thegeneral manager level in sales, and at the section manager
level in technical and corporate departments. However, toplace women in leadership positions, we will hire more careertrack women and, through retention measures, steadily expand
the number of assistant manager-level women who aspire to
become managers. In parallel, we will actively promote generallevel individuals with demonstrated competence, and makemore experienced-female hires. In conjunction, we will provide
support that is attentive specifically to women’s needs, such as
training and networking.
44 JSW Integrated Report 2023

Companywide Healthand Safety Manager

President(Director in charge of Health &Safety Management)

Companywide Healthand Safety Management
Administrative Office

Support for work-life balance

To accommodate the diverse values and needs of ouremployees, we are undertaking to enhance our system byoffering them a cafeteria (benefit) plan from which they can
select the benefits that fit their needs.
Indicators

FY2020

FY2021

FY2022

Percentage of female new graduate
hires for career-track positions (%)1

10.0

15.0

15.6

Percentage of women amongassistant managers (%)

7.8

8.7

10.2

Number of employees who tookchildcare leave

11

16

34

Percentage of employees withdisabilities (%)2

1.90

2.21

2.46

1. The percentage of female new graduate hires for career-track positions isbased on the number of women who were offered employment during the
fiscal year in question and who joined the Company on April 1 of the next
fiscal year.
2. A
 s of June 1 of each fiscal year

Health and
Safety Manager(JSW Plant Managers)

Labor union
JSW plants,
affiliated companies

Japan Steel Works M&E
General Health and
Safety Managers

In addition to establishing a childcare and family care leavesystem and ensuring that it conforms with current law, we areworking to create an environment that facilitates a balance ofwork with childcare and family care, with telecommuting,staggered work hours, and an hourly paid leave system.
In terms of education, we are promoting measures tosupport self-development, so that employees can upgrade
their skills in line with their motivation.

Employee benefits

JSW plants

General Health and
Safety Managers

Muroran Plant
Health and
Safety Manager(President, Japan Steel Works
M&E, Inc.)

M&E labor union
M&E affiliated companies

Head Office Safety and
Health Department

Head Officelabor union

Health and Safety Initiatives and Results
In JSW Group, we specify priority items for health and safety activities
each fiscal year, and the Group (as well as the labor union) and suppliersof each plant work together on activities aimed at achieving zero
occupational accidents.
Our major sites have acquired certification for their occupational healthand safety management systems, and are enhancing the effectiveness of
their activities.
To promote employee health, including mental health care, the Group
conducts periodic stress checks and strives to properly manage working
hours, among other activities.
Site

Certification

Date Acquired/Renewed

Hiroshima Plant

ISO 45001

August 12, 2022

Japan Steel Works
M&E

OSHMS

June 5, 2021

Frequency Rate of Accidents per
Million Workhours1
Domestic Group companies2,3
Manufacturing Industry Average4

1.5
1.2

Target

1.31

1.25

0.46

0.51

0.41

0.41

0.41

2020

2021

2022

1.21

0.9
0.6
0.3

0.66

0
(FY)

1. Frequency rate of accidents calculated from lost-worktime,
serious and fatal accidents during the fiscal year
2. Including partner companies on Company premises
3. Excluding certain Group companies
4. Manufacturing industry averages are from the surveyof occupational accident trends (Ministry of Health,Labour and Welfare).

JSW Integrated Report 2023 45

Human Rights

Supply Chain Management

Respect for Human Rights
JSW Group respects internationally recognized codes such as
the International Bill of Human Rights and the ILO Declaration
on Fundamental Principles and Rights at Work. We also
promote efforts to respect human rights based oninternational guidelines such as the United Nations’ Guiding
Principles on Business and Human Rights.
In accordance with these, we have established The Japan
Steel Works Group Human Rights Policy, which clearlyprohibits discrimination, harassment, child labor, and forcedlabor; indicates our respect for basic labor rights; andexpresses our commitment to respecting all human rights inall aspects of our business activities. To ensure that this policy
is propagated throughout the Group’s business activities, we
use in-house newsletters, bulletin boards, portal sites,
e-learning programs and other means to disseminate thepolicy and educate employees.
In this context, JSW Group has focused on health andsafety activities and harassment prevention, with the primary
aim of ensuring that each and every employee can performtheir work in a healthy and pleasant environment where they
are respected as individuals and their human rights are not

Our Perspective and Basic Procurement Policy
violated. We have established internal and external
consultation hotlines and a resolution process through theHarassment Countermeasures Committee. We conduct fairhiring practices that respect the human rights of all individuals,
and have also established systems that support a favorable
work-life balance, foster a workplace environment that isinclusive of diverse personnel, and strive to provide equal
opportunities so that individuals can excel.
In building our supply chain, we request, as appropriate,that suppliers understand and respect human rights andcomply with relevant laws and regulations. In an effort to build
human rights due diligence, we began conducting CSR
Procurement Survey in fiscal 2023.
Recognizing that its business activities are extremely vast interms of the fields covered, involving a wide variety of individuals,
JSW Group will engage in dialogue with labor unions and allother stakeholders, set priorities and address them appropriately,and step up the monitoring of human-rights-related risks toprevent any direct or indirect negative impacts on humanrights. For details concerning The Japan Steel Works Group
Human Rights Policy, please refer to our website.

The Japan Steel Works Group Human Rights Policy, please refer to our website.
Respect for human rights:
https://www.jsw.co.jp/en/sustainability/social/diversity.html

Local Communities
The Group believes that companies are members of society, and that they progress in collaboration with various communities,
including local communities. In addition to contributing to society through its business, JSW Group also engages in socially
responsible activities with the aim of realizing a better society and becoming a company that is rooted in the local community. Pleaserefer to our website for details regarding the activities we engage in, such as cleanups, education, and community exchange.

JSW Group has established The Japan Steel Works Group
Standards of Business Conduct, which states, among otherthings, that the Group will respect the human rights of all
people, conduct business transactions properly as based onfair and free competition, and engage in responsible
procurement. In September 2022, The Japan Steel Works
Group Human Rights Policy was established to promoterespect for human rights in accordance with international
norms. Furthermore, in September 2022, we revised theexisting The Japan Steel Works Group Basic Procurement
Policy to have our suppliers achieve an understanding ofand cooperate with the above standards and policies, andto facilitate product procurement that takes into
consideration matters such as human rights, labor, healthand safety, the environment, and information management ina manner consistent with the move toward a sustainable

society. We also formulated our Request to Business
Partners, a document that outlines the specifics regarding
our vision of how we hope suppliers conduct business.
The Japan Steel Works Group Policies and Request to
Business Partners are published on our website, and we arerequesting confirmation of agreement.
Going forward, we will work to comprehensively
disseminate these Policies and Request, strive to monitor thesustainability initiatives of our major suppliers, conduct
dialogue and other interactions with suppliers as needed, andcontinue to strengthen our supply chain risk management andits sustainability. To ensure that all suppliers in our supply
chain can continue to play indispensable roles within society,we will share with them the Group’s policies and work
together to promote sustainable procurement practices thatsustain sound growth together through our business dealings.

For details concerning The Japan Steel Works Group Basic Procurement Policy and Request to Business Partners, please refer to our website.
Supply Chain: https://www.jsw.co.jp/en/sustainability/social/supplychain.html

Supplier Survey
Since fiscal 2023, we have been soliciting participation in a
CSR Procurement Survey of our major suppliers, to monitor
the status of their sustainability initiatives. The survey is
divided into nine major sections, based on such themes as
Request to Business Partners and The Ten Principles of the
UN Global Compact. Representative survey topics include
child labor and forced labor prevention (Labor), respect forhuman rights and discrimination prevention (Human Rights),
and initiatives to prohibit conflict minerals (Supply Chain). In
addition, in conjunction with soliciting response to the CSR
Procurement Survey, we also request that suppliers confirm
their agreement with The Japan Steel Works Group Human
Rights Policy, The Japan Steel Works Group Basic

Procurement Policy, and Request to Business Partners.
Suppliers whose response was requested to the CSR
Procurement Survey for fiscal 2023 were selected based on
the actual value of procurement made by each of the Group’s
major manufacturing locations. We are currently collecting thesurvey responses. Once we have completed this process, wewill analyze the responses and provide feedback to suppliers.
If our analysis reveals the presence of high-risk challenges, wewill seek to grasp the actual situation in more detail andencourage improvement through dialogue with suppliers.
Beginning with the next fiscal year, we will strive to establish
a periodic survey system, updating its content as needed
based on our analyses and the latest social trends.

Survey System (first-time initiatives in parentheses)

1. Initiative request

Social Contribution Activities: https://www.jsw.co.jp/en/sustainability/social/socialcontribution.html

CSR Procurement Survey Items
1. Corporate Governance Relating to CSR(In 2022, published The Japan Steel Works Group Human Rights Policy,
The Japan Steel Works Group Basic Procurement Policy, and Request to
Business Partners on our website)

2. Human Rights
3. Labor
4. Environment

2. Monitoring status of initiatives

5. Fair Corporate Activities(In 2023, requested response to CSR Procurement Survey from major
suppliers. Responses currently being collected)

6. Product Quality and Safety
7. Information Security

Work experience activities

8. Supply Chain

3. Analysis of initiatives

9. Co-existence with Local Communities(Planned)

Sponsor and exhibitor at Hiroshima Skill Fair

4. Feedback to suppliers(Planned)

46 JSW Integrated Report 2023

JSW Integrated Report 2023 47

Corporate Governance

Building a Stronger Governance System
Governance Policy of The Japan
Steel Works, Ltd.
• Formulated Policies in Relation to

Basic Approach

Cross-Shareholdings• Formulated Basic Policy for

Based on our Philosophy and the Standards of Business Conduct, the Group recognizes that it is essential to earn the trust of all
stakeholders, including shareholders, customers, business partners and employees, in order to simultaneously create social value
and enhance sustainable corporate value. We therefore continue to strengthen corporate governance to ensure the transparency,
soundness and effectiveness of management.

Officer Nominations• Formulated Criteria for

Independence of Outside
Officers

implement a policy for determining
the content of remuneration, etc., forindividual directors• Apr. Established ESG Promotion
Committee• Jun. Changed the membership of the• Jun. Introduced
Nomination Advisory Committee andrestricted stock-based
Remuneration Advisory Committee
compensation planso that the majority of members, andfor officers
the chairs, are outside directors

2011

Overview of Corporate Governance Structure
The Japan Steel Works, Ltd. (“the Company”) has adopted thestructure of a company with an audit and supervisory board.
The Board of Directors consists of nine directors (four of whom
are outside directors) and the Audit & Supervisory Board
consists of four Audit & Supervisory Board members (two ofwhom are outside Audit & Supervisory Board members).
The term of office for directors is set at one year. The
Company has also introduced an executive officer systemthat separates management decision-making andsupervisory functions from business execution functions
conducted by executive officers, thereby speeding up
decision-making, strengthening supervision and improving
business execution. Since April 1, 2023, the Company has
implemented a system that, in principle, ensures that in thecase of head office divisions directors and executive officers,
and for business divisions executive officers and other2015• Jun. Amended Articles of Incorporation* At the 85th Annual General Meeting of
Shareholders held in June 2011, the numberof directors was reduced to 7 (from 13 in theprevious year).
• Jun. Appointed first outside director(one director)

50
25

Auditing

Outside directors

Remuneration Advisory
Committee

Decision-making

Cooperation

25.0

12.5
2014

2015

• Head Office divisions• Business divisions• Plants

Information Security
Committee

Companywide Health and
Safety Council

Export Control
Administration Committee

Business execution organizations

Environmental Management
Committee

Directors with business execution
responsibilities and executive officers

ESG Promotion Committee

Auditing• Apr. Conducted evaluation of Audit &Supervisory Board effectiveness• Apr. Established Liaison Council of Outside

Officers• Jun. Changed the number of members on

the Board of Directors from nine to eight

2016

2017

2018

2019

2020

2021

2022

44.4

2023

Percentage of Female
Audit & Supervisory
Board Members

Percentage ofFemale Directors

(FY)

1

1

11.1%

25.0%

8

3

Male
FemaleRemuneration Advisory
Committee

Nomination Advisory
Committee

Board of Directors

Executive Board

Attendees(with voting right)

Directors(5 inside, 4 outside)

Inside directors (5)Non-director executive officers (5)President (1)Director in charge of Personnel Department and Secretary Office (1)Outside directors (4)Observers/
Advisors(no voting rights)

Audit & Supervisory Board members(2 inside, 2 outside)

Inside Audit & Supervisory Board
member (1)–Chairperson/
Committee Chair

President

President

Outside director

Objectives andAreas of Authority

Decides and reports on basic
management policies, matters stipulated
by laws and regulations, and otherimportant management matters, andmonitors the execution of duties bydirectors and executive officers

Meetings in FY2022

18

Composition

Attendees

Chairperson••

 eliberates and decides on importantDmanagement matters and matters thathave a significant impact on the
Company’s profit and loss iscusses and reports on basicDmanagement policies and mattersrelating to overall management

39

As an advisory body to the Board of
Directors, deliberates on matters relating
to the remuneration of directors andexecutive officers, and reports theresults to the Board of Directors

 s an advisory body to the Board ofA
Directors, deliberates on mattersrelating to the nomination and dismissalof directors, Audit & Supervisory Board
members and executive officers, andreports the results to the Board of
Directors• Consult on the succession planning forthe president, and report the results to
the Board of Directors•

43Management Council

Audit & Supervisory Board

Liaison Council of Outside
Officers

Inside directors (5)Inside Audit & Supervisory Board members (2)Non-director executive officers (5)Business division directors and business division deputy directors,
general plant managers, Head Office division managers

Audit & Supervisory Board members(2 inside, 2 outside)

Directors (3 inside, 4 outside)
Audit & Supervisory Board members(2 inside, 2 outside)

President

Inside Audit & Supervisory Board member

President

Objectives andAreas of Authority

Coordinates and reports on the following important management matters and shares
management information
1. Analysis of business environment, progress of business plans
2. Important matters relating to research and development
3. Matters relating to Group companies
4. Matters that have a significant impact on management including those relating tosales, production, funding, profit and loss
5. Other important management matters

Reports, discusses and makes
resolutions on important matters relating
to auditing; this does not preclude theexercise of individual Audit & Supervisory
Board members’ authority

Advance explanation of the resolution
matters and deliberation matters of theBoard of Directors, and report on thestatus of operations and importantmanagement matters of the Company
and the Group

Meetings in FY2022

12

13

12

• Group subsidiaries, etc.

* The Liaison Council of Outside Officers was established as a venue to provide outside officers with advance explanations about the agenda for Board of
Directors meetings, and as a forum for outside directors and executive officers to verify, report on, and exchange opinions about business execution.

48 JSW Integrated Report 2023

2023

Role and Composition of Governance Bodies

Representative Director &President

Management Council

2022

Business execution

Executive Board

Internal Auditors Office2021• Apr. Established ESG Promotion Officeoutside directors

37.5

33.3

Oversight/Monitoring

Risk Management
Committee

Accounting auditors

Cooperation

Nomination Advisory
Committee

Internal Control Committee

Cooperation

Executive directors• Jun. Appointed three0

Board of Directors

Outside Audit & Supervisory
Board members

2020

Percentage of Outside Directors

Composition

Auditing

Advisory Committee andRemuneration Advisory
Committee• Mar. Conducted evaluation ofBoard of Directors effectiveness(once a year since 2016)• Jun. Appointed two outside
directors

Maximum number of directors: 20 10
Term of office: 2 years 1 year

Appointment and Dismissal

Audit & Supervisory
Board members

2018• Feb. Established Nomination

regarding directors

General Meeting of Shareholders

Reporting2016

business divisions and supervision by the Board of
Directors• Jun. Appointed four outside directors, and changed
the number of members on the Board of Directors
from eight to nine• Jun. Appointed one female outside director and one
female outside Audit & Supervisory Board member• Jun. Appointed executive officers with specialist
knowledge and skills in legal affairs and internal controls• Apr. Introduced executive officer system

employees, are each responsible for oversight and businessexecution for the tasks they are delegated or assigned by
the Board of Directors. This clearly delineates businessexecution of the business divisions from supervision by the
Board of Directors.
Audit & Supervisory Board members attend important
meetings including those of the Board of Directors, theExecutive Board and the Management Council. Once every
fiscal half in principle they visit plants, sales locations andGroup companies, and receive reports on necessary
information from each division. They also exchange opinionswith directors, executive officers and other keypersons, andbased on these exchanges, advise management from an
objective and impartial standpoint, while strictly monitoring theexecution of duties by directors.

Corporate Governance Structure

Audit & Supervisory Board• Apr. Clearly delineated business execution of• Mar. Board of Directors resolved to• Nov. Formulated Corporate

JSW Integrated Report 2023 49

Major Matters Discussed at the Board of Directors Meetings in FY2022• Medium-term management plan JGP2025• Digital Transformation Promotion• Executive structure• Evaluation of the effectiveness of the Board of• Measures to prevent recurrence of• R&D Framework

Directors• Agreement with the TCFD’s recommendations
and disclosure of information• Business portfolio• Review of the rationality of cross-shareholdings

inappropriate conduct• Feedback on IR/SR activities• Formulation of the Purpose• Report on the status of complianceline operations• Quality Control Framework

2

Results of the FY2021 Analysis and Evaluation Results and an Overview of the Resultant FY2022 Initiatives

	In response to the three issues identified in the fiscal 2021 effectiveness evaluation, the Board of Directors proceeded forward withthe following actions in fiscal 2022. As a result, the effectiveness evaluation for fiscal 2022 confirmed that improvements have beensteadily made for each of the issues and that effectiveness has been generally ensured.

• Talent development strategy• Identification of Materiality

Issues identified in FY2021• Status of operations of internal control systems• Risk Management

Skill Matrix
We identified six issues (i.e., Materiality) as themes that should be prioritized in order to realize our Purpose at the Board of
Directors meeting in November 2022. After verifying the importance of the Materiality identified, we selected the skills needed to
implement effective management initiatives aimed at resolving these issues.
Moreover, during the selection of candidates for roles as directors or Audit & Supervisory Board members at the Annual General
Meeting of Shareholders held in June 2023, with consideration to responding to inappropriate conduct—and preventing its recurrence—
we increased and strengthened human resources with skills and knowledge in the areas of legal affairs and internal controls.
We also undertook a partial revision of quality-related skills, separating the previous category of “Manufacturing, Quality Control,
Technology and R&D” into two: “Quality” and “Manufacturing, Technology and R&D.”
For information on the skill matrix, please refer to p. 54-55.

FY2022 initiatives

Deeper discussions at the Board of
Directors meetings to work towardsustainable growth for the Group(1) W
 e systematically provided multiple opportunities for discussions, and made decisions on
TCFD-related disclosure, the formulation of the Purpose, and identifying Materiality.
(2) During discussions on important topics such as the business portfolio and the R&D system (including
the establishment of the Innovation Management Headquarters), there were repeated deliberations
about the approach the Group should take to achieve sustainable growth.

Close scrutiny of the progress being
made by the medium-term
management plan JGP2025 amidchanges in the business environment(1) A s the business environment undergoes dramatic changes, in order to adjust the medium-term
management plan as necessary, we looked carefully at the progress of business-specific strategies
in Q1.
(2) W hen discussing individual resolutions (important investments, etc.), members exchanged opinionswith a focus on the next medium-term management plan.

Upgrading of risk management that
includes a review of the quality
control system(1) R esponding to the inappropriate conduct, and preventing recurrence, has been set as a highestlevel priority, and a company-wide quality assurance system.
(2) W e have developed a mechanism (the Liaison Council of Outside Officers) to reflect the opinions ofoutside officers in agenda items put before the Board of Directors. We have also worked to improveawareness and sensitivity toward risk-taking, and while not perfect some progress has been made.
Governance initiatives related to our response to the inappropriate conduct
For the 97th Annual General Meeting of Shareholders held in June 2023, we strove to provide shareholders
with information to help guide them in exercising their voting rights with due care in advance (publishing
information on the website, by posting out letters, etc.).

Reasons for Appointment of Outside Directors
JSW believes that the function and role of outside directors in corporate governance is to strictly supervise the execution of duties
by directors and to make management judgments and decision-making from a neutral and objective standpoint with no conflict ofinterest with the Company, and from an independent standpoint with no risk of conflict of interest with general shareholders. To
that end, the Company has appointed four outside directors.
The roles expected of outside directors are stipulated in the Corporate Governance Policy.
 or information on the Corporate Governance Policy of The Japan Steel Works, Ltd., please refer to the following.
F
https://www.jsw.co.jp/pdf/sustainability/governance/governance/GovernancePolicy_en.pdf

1
Formulation and Implementation of Succession Plan for the President
	With respect to the formulation and implementation of the succession plan for the president, the Nomination Advisory Committee
holds appropriate discussions, considering the qualities of the candidate, such as experience, ability and character, based on thecorporate philosophy of JSW Group and management strategies, and reports to the Board of Directors as necessary.
2
Appointment Criteria and Procedures	The appointment of the president is decided by the Board of Directors after receiving a report from the Nomination Advisory
Committee based on the succession plan.

Dismissal Criteria and Procedures	Dismissal of the president is decided by the Board of Directors if circumstances make it difficult for the president to carry out his or her
duties, or if his or her suitability comes into question, after receiving this recommendation from the Nomination Advisory Committee.
3

Materiality
Creating Value and Solving Social Issues
through JSW Group’s Businesses

Realization of a
Plastic-Resource-Recycling Society

Contribution to a
Low-Carbon Society

Contribution to a
Super-Smart Society(1) Acquiring and training of humanresources, investigating measures
to improve human capital(2) Investigating and strengthening
value creation capabilities andinnovation management systems(3) Investigating and improving
engagement with different
stakeholder groups(4) Investigating and strengthening
corporate governance, internal
controls, and risk management

It was evaluated that deeper, continuous
discussions are required into how to acquire
and train human resources, and into
promoting diversity. As such, by steady
implementing these discussions, we will tie
these into formulating and enacting
medium-term personnel plan, and by
periodically conducting monitoring andreviews, this can be tied into reforms toworkplace culture and employee awareness.

Evaluations also suggested a need to review
our value creation capabilities, such as byputting in place an R&D system, expanding
business via M&As, and promoting DX. As
such, we plan to deepen discussions intovalue creation capabilities, including into ourbusiness portfolio, and connecting these tobusiness activities.

We have ascertained the importance ofengaging with, and providing information to,various stakeholders with the aim of achieving
sustainable growth for the Group. As such, aswell as working on setting Materiality KPIs, weplan to strengthen information sharing withdifferent stakeholder groups and enhancedialogue.

We will work to redevelop and review ourinternal controls—including on quality
management—discuss how to further
strengthen the Group’s governance andcompliance, and establish and review risk
management systems.

Materiality
Bolstering JSW Group’s Management
Foundation for Sustainable Growth

Human Capital Improvement andDiversity and Inclusion

Investment in the Future with
Innovation Management

Governance Reinforcement of
JSW Group

Evaluation of the Audit & Supervisory Board’s EffectivenessEvaluation of Board of Directors’ Effectiveness
The Board of Directors continues to enhance its functions by conducting an annual questionnaire-based analysis and evaluation.
The following is a summary of the analysis and evaluation for fiscal 2022.
Analysis and Evaluation Methodology(1) During February 2023, an anonymous questionnaire was administered to all directors and Audit & Supervisory Board members.
As well as reorganizing and revising the questions of the questionnaire around strengthening monitoring functions, we plan to
identify issues from the comments we receive, and so we increased the number of open-ended questions.
The planning of the subjects covered and the collection and tabulation of the survey results were outsourced to a third-party
organization.
(2) The Board of Directors Secretariat compared the results of the questionnaire with previous evaluations, and recompiled andanalyzed the results, including identifying subjects given low evaluations and extracting important comments from the openended responses. In addition, the secretariat compiled and analyzed data on discussion times in fiscal 2022 and verified
differences between annual activity plans and actual results.
Questionnaire content(3) At the April and May 2023 Board of Directors meetings, the board discussed
I. Purpose of the Board of Directors
its effectiveness from the perspective of improving the medium-to-long-term
II.	Composition, discussion, and monitoring functions
corporate value of the entire Group, based on the compiled results of theof the Board of Directors
III.	Performance of inside and outside directors
questionnaire, the re-tabulation and analysis of those results by the Board ofIV.	Management of the Nomination Advisory
Directors Secretariat, and advice from a third-party organization.
Committee and Remuneration Advisory Committee
V.	Miscellaneous (pertaining to the Board of Directors
in general)

50 JSW Integrated Report 2023

Future Initiatives Based on the FY2022 Analysis and Evaluation Results

Major issues to be addressed in FY2023

Succession Planning for the President and Procedures for Appointment and Dismissal

1

3	Based on the fiscal 2022 effectiveness evaluation and the Group’s Materiality, we identified the following as major issues to beaddressed in fiscal 2023.

The Audit & Supervisory Board evaluates its own effectiveness so as to clarify areas of its activities that require consideration or
improvement. These are then reflected in audit plans for the following fiscal year. By doing so, the board aims to improve thequality of its audits and its effectiveness overall.
As part of the evaluation, the four Audit & Supervisory Board members, the president, one outside director, and the generalmanager of the Internal Auditors Office, answer a questionnaire about the effectiveness of the board’s responsibilities,
composition, and operations; Group audits; interaction with the Board of Directors; its three-way audits; and internal controls.
The evaluation for fiscal 2022 showed that improvements had been made in areas identified in the previous fiscal year as
needing improvement namely, (1) greater diversity in the selection of Audit & Supervisory Board members, (2) cooperation withoutside directors, (3) cooperation with the Internal Auditors Office, and (4) involvement in company-wide risk management—and
was determined to be largely carrying out its auditing activities appropriately and functioning effectively. The following four areas of
improvement were identified for the following fiscal year: (1) more effective operations through a more suitable composition for the
Audit & Supervisory Board, (2) stronger cooperation with auditors at subsidiaries for better Group governance, (3) opportunities forperiodic discussions with outside directors, and (4) enhanced auditing with regards to company-wide risk management activities
and compliance.
To reflect these, the fiscal 2023 auditing policy that the board follows in its auditing activities is as follows: (1) carrying out auditsof the Group’s internal controls from the perspective of Group governance; (2) auditing the status of appropriate risk controls, that
follow the three lines of defense model, in company-wide risk management activities; and (3) placing greater importance oninternal controls audits during the fiscal year and year-end follow-up audits to achieve more effective auditing activities.
JSW Integrated Report 2023 51

Officers’ Remuneration

obtained by dividing the standard amount by position
according to the director’s position by the closing
price of the Company’s shares on the Tokyo Stock
Exchange on the day before the date of resolution by
the Board of Directors regarding the execution of therestricted stock remuneration allocation agreement.
Moreover, in consideration of the period of time it takes
management measures to contribute to businessperformance, the restricted transfer period is five years
in accordance with the five-year length of the mediumterm management plan JGP2025.

The Company’s policy for determining the directors’ remuneration (the “policy for determining”) was resolved at the Board of
Directors meeting held on March 16, 2021, and was partially revised at the Board of Directors meeting held on March 23, 2022,with the aim of improving incentives for achieving the medium-term management plan JGP2025. In accordance with the revision,
the Company revised a part of the officers’ remuneration system, focusing on the evaluation method related to variable remuneration.
(Outline of the revision of the policy for determining and review of the officers’ remuneration system)
As a result of the revision of the policy for determining and the review of the officers’ remuneration system, the variable
remuneration portion of annual remuneration, which previously consisted solely of remuneration linked to divisional performanceand results, was partially changed to be linked to company-wide performance. In addition to this move to clarify the responsibility
all inside directors hold for company-wide performance, the portion of the bonus evaluation linked to dividends was changed toreflect individual performance results. The percentage of fixed remuneration was reduced for representative directors. Thesechanges were designed to increase performance-linked incentives.

1

Basic Policy for Directors’ Remuneration

	The maximum amount of directors’ remuneration
is decided by resolution of the General Meeting of
Shareholders. The basic policy is to set remunerationthat provides sound incentives for sustainably enhancing
corporate value, at a level corresponding to respectiveroles and responsibilities, and that ensures fairness andtransparency in remuneration-related decision processes.
2

Procedures for Determining Directors’ Remuneration

	The directors’ remuneration is determined by the Board of
Directors after receiving a report from the Remuneration
Advisory Committee. However, the allocation of annual
remuneration by position and by individual and theallocation of bonuses by individual may be delegated tothe president by resolution of the Board of Directors.
	In this case, the president makes decisions in accordancewith the content of the report.
3

Composition of Directors’ Remuneration

	The composition and percentage breakdown of directors’
remuneration are as follows(1)	Representative director & president and representative
director & executive vice president		The composition shall be annual remuneration ((1) baseportion, (2) company-wide performance-linked portion)and stock-based remuneration.
		The president’s remuneration comprises anapproximate 55:35:10 ratio of fixed remuneration ((1)
base portion): variable remuneration ((2) companywide performance-linked portion): stock-based
remuneration. For the vice president, the approximate
ratio is 60:30:10 of fixed remuneration ((1) baseportion): variable remuneration ((2) companywide performance-linked portion): stock-based
remuneration.
(2)	Inside directors		The composition shall be annual remuneration ((1) baseportion, (2) company-wide performance-linked portion,(3) divisional performance/results-linked portion),bonuses, and stock-based remuneration.
The approximate ratio of fixed remuneration ((1) baseportion) to variable remuneration ((2) company-wide
performance-linked portion, (3) divisional performance/
results-linked portion, and bonus) to stock-based
remuneration is 60:30:10.

President
Vice President
Inside directors
Outside directors

55

35

10

60

30

10

60

30

10

(%)

100
Fixed remuneration
Variable remuneration
Stock-based remuneration

52 JSW Integrated Report 2023(3)	Outside directors
		Outside directors, who are responsible for supervisory
functions, shall be paid only fixed remuneration (baseportion of annual remuneration) in consideration of
their independence from management, objectivity,and in light of their supervisory duties, which include
mutual checks on directors.
4	Matters Relating to the Method of Calculation of

Directors’ Remuneration, Etc.
	The summary of each type of remuneration is as follows.
Variable remuneration is calculated by comparing actual
performance against the consolidated operating income,net profit attributable to shareholders of the parent
company, and other indicators set forth in JGP2025 astargets for fiscal 2022, and multiplying the percentage ofachievement by the base amount of remuneration for eachposition.
(1) Annual remuneration
1) Base portion		The base portion is fixed remuneration determined on
the basis of the particular position and the number ofyears the position has been held by the individual.
2) Company-wide performance-linked portion		The company-wide performance-linked portion isvariable remuneration that is determined on the basisof consolidated performance during each fiscal year.
		It consists of a net profit attributable to shareholdersof the parent company and a consolidated operating
income portion.
		This indicator was selected because of its importancein terms of indicating how performance directly links tothe company-wide performance targets in the mediumterm management plan.
3) Divisional performance- and results-linked portion		The portion linked to divisional performance and results
is determined as variable remuneration based on theperformance evaluation of the division for which thedirector is in charge.
(2) Bonuses
		Bonuses are variable remuneration determined on thebasis of the performance evaluation of the division forwhich the director is in charge and the performance
results of each individual.
		The ratio of the performance evaluation portion foreach division and the performance evaluation portionfor each individual is 50:50.
		However, directors in charge of head office divisions
receive only the individual performance portion.
(3) Stock-based remuneration
		Stock-based remuneration is granted in the formof restricted transferable shares as remuneration
for the purpose of providing medium-to-long-term
incentives to increase corporate value and to further
the sharing of value with shareholders. The number ofshares to be allocated shall be the number of shares5	
Remuneration for Audit & Supervisory Board

Members, Etc.
	The remuneration of each Audit & Supervisory Board
member shall consist only of fixed remuneration (baseportion of annual remuneration) from the viewpoint ofemphasizing independence and objectivity with respect tomanagement.

Group Governance
JSW Group consists of The Japan Steel Works, Ltd. and 45
subsidiaries (33 consolidated, 12 non-consolidated). The
Group operates the Industrial Machinery Products Business,
Material and Engineering Business, and other businesses inJapan and around the world.
For Group companies, the JSW business division withprimary responsibility leads the formulation of management
policies and short- and medium-term management plans, andmonitors their progress. In order to enhance the effectivenessof these efforts, we assign full-time or part-time directors or
Audit & Supervisory Board members with the responsibility ofsupervising and auditing the execution of duties at Group
companies, in principle, thereby ensuring that the execution ofduties by directors, etc., and employees at Group companies
comply with laws and regulations and the Articles ofIncorporation. In addition, regarding risks relating to specificfunctions, such as health and safety, environmental
management, and export control administration, each Group
company participates in the various committees formed by
the relevant divisions of the Company, or follows theregulations developed by the Company, and appropriately

manages these risks.
Each company in the Group also appoints individuals to be
in charge of general affairs, accounting, and IT matters related
to internal control. The appointed individuals receive guidance
and training from the Internal Control Committee Office andconduct self-assessment of implementation and operation ofinternal control in step with risk assessment.
The status and results of the self-assessment of internal control
operations are reported to the Office and each company.
In response, the Internal Audit Division of the Company, which
also serves as the Office of the Internal Control Committee,
monitors the governance and risk management status ofeach company by directly or indirectly auditing the status ofeach company and the methods and results of self-assessments.
With regard to internal control over quality assurance
processes at Japan Steel Works M&E, Inc., the Company ispromptly implementing its reorganization, includingorganizational reforms to strengthen mutual checks andbalances among divisions and eliminate the concentration of
authority, moving ahead with operations and assessments
under the guidance and management of the Company.

Cross-Shareholdings
1

Policy on Cross-Shareholdings

The Company holds shares that it judges, through regular confirmation and review, to be necessary for policy
purposes, and that contribute to the Company’s businesses over the medium to long term in ways suchas maintaining and strengthening sound, ongoing relationships with business partners, forming businessalliances, and supporting the sound development of investee companies.
Each year, the Company confirms the purpose of individual cross-shareholdings and current transaction	Regular Confirmation and Review status, etc., and the Board of Directors verifies whether shareholdings are appropriate by comprehensively
2

considering the significance and purpose of the Company’s acquisition and holding of the shares, as well as
the safety, profitability, economic viability, risks and other factors associated with the shareholdings.

of Shareholdings	Policy on Exercise of Voting
3
RightsThe Company makes decisions on the exercise of voting rights based on factors including the businessconditions of the investee company and its business relationship with the Company, having confirmed thedetails of each proposal from the standpoint of increasing the investee company’s corporate value over the
medium to long term and fulfilling that company’s social responsibilities.

Status of Holdings
Number of listed and unlisted stocks held; Market value of cross-shareholdings
on balance sheet ÷ Consolidated net assets
Number of stocks held (left axis)
Market value of stocks ÷ Consolidated net assets (right axis)(Stocks)

100
80
60
40

(%)

88

50

85
69

21.6

20

15.5

16.9

2019

2020

40

62

56

12.3

11.4

10.0

10

2021

2022

2025
Target

(FY)

30
20

0

0
2018

Based on the Corporate Governance Policy of The Japan
Steel Works, Ltd., we regularly confirm and review thesignificance of our policy cross-shareholdings, and we are
gradually selling shares whose significance has diminished.
In addition, setting forth in our medium-term management
plan JGP2025 the financial strategy of ensuring an appropriatebalance between investment in growth and shareholder
returns in order to sustainably increase corporate value, theCompany plans to reduce its cross-shareholdings to less than
10% of net assets by the end of fiscal 2024, and to allocate
the funds obtained from the sale of cross-shareholdings into
areas such as investment growth and shareholder returns.

JSW Integrated Report 2023 53

Management Team (As of June 30, 2023)
Directors / Audit & Supervisory Board Members

NameToshio Matsuo

Junichiro Deguchi

Hiroki Kikuchi

Shigeki Inoue

Motoyuki Shibata Yoshiyuki Nakanishi

Title

Representative Director& President

Representative Director &Executive Vice President

Director & Managing
Executive Officer

Director & Managing
Executive Officer

Director & Executive
Officer

CareerApr. 1984 Joined theCompany
Apr. 2013 Deputy General
Plant Manager, Hiroshima
Plant
Apr. 2015 General Plant
Manager, Hiroshima
Plant
Apr. 2016 Executive Officer
Apr. 2017 Managing
Executive Officer;
Director of Injection
Molding Machinery
Business Division; In
charge of Hiroshima
Plant
Jun. 2017 Director &Managing Executive
Officer
Apr. 2020 Representative
Director & Executive Vice
President; In charge ofExport Control
Administration; In chargeof Plastics Machinery
Business Division,
Injection Molding
Machinery Business
Division, Industrial
Machinery Business
Division; In charge of
Meiki Plant
Apr. 2021 In charge ofOrdnance Business
Headquarters;	In charge of Business
Development Office; Incharge of Hiroshima
Plant and Yokohama
Plant
Apr. 2022 Representative
Director & President(current position)

Apr. 1981 Joined the Company
Apr. 2013 Deputy General
Plant Manager, Muroran
Plant
Apr. 2015 Executive Officer;
Deputy Director of SteelBusiness Division
Oct. 2017 General Manager,
Personnel Department
Apr. 2018 In charge of CSR &Risk Management (current
position); In charge ofExport Control
Administration; In chargeof Health & Safety
Management; In charge ofEnvironmental
Management (current
position); In charge of
Secretary Office andGeneral Affairs Department
Jun. 2018 Director & Executive
OfficerJul. 2018 In charge ofGeneral Affairs Department(current position); General
Manager, Secretary Office
Apr. 2019 Director &Managing Executive
Officer
Apr. 2020 Chief Information
Security Officer; In chargeof Office of Information
Technology; In charge of
Personnel Department
Apr. 2021 In charge of
Promoting ESG (current
position)
Apr. 2022 Representative
Director & Executive Vice
President(current position); In
charge of Export Control
Administration (current
position); In charge of
Personnel Department
Jun. 2022 In charge ofMaterial and Engineering
Products Business (current
position)

Apr. 1985 Joined MitsuiBank (currently
Sumitomo Mitsui Banking
Corporation)
Apr. 2012 General Manager,
Nihonbashi-higashi
Corporate Business
Office, Sumitomo Mitsui
Banking Corporation
Apr. 2015 Joined theCompany
Jul. 2015 General Manager,
General Affairs
Department
Apr. 2016 General Manager,
Secretary Office
Apr. 2018 Executive Officer
Jul. 2018 General Manager,
Corporate Planning
Office (current position)
Apr. 2020 Chief Financial
Officer (current position),
In charge of Finance &Accounting Department(current position);
General Manager,
Business Development
OfficeJun. 2020 Director &Executive Officer
Apr. 2021 Director &Managing Executive
Officer (current position)
Apr. 2022 In charge of
Plastics Machinery
Business Division,
Injection Molding
Machinery Business
Division, Industrial
Machinery Business
Division and OrdnanceBusiness Headquarters;
In charge of Business
Development Office
Apr. 2023 General Manager,
Business Development
Office (current position)

Apr. 1986 Joined theCompany
Apr. 2015 Deputy General
Plant Manager, Hiroshima
Plant
Apr. 2017 General Plant
Manager,
Hiroshima Plant
Apr. 2018 Executive Officer
Apr. 2021 Managing
Executive Officer;
Director of Industrial
Machinery Business
Division, General
Manager, Business
Development Office
Apr. 2022 Chief Technology
Officer (current position);
In charge of Quality
Management (current
position); In charge ofIntellectual Property
Department (current
position); In charge of
Yokohama Plant
Jun. 2022 Director &Managing Executive
Officer (current position)
Sep.2022 General Manager,
Quality Management
Office (current position)
Apr. 2023 In charge of New
Business Promotion
Headquarters (current
position); General
Manager, Innovation
Management
Headquarters (current
position)

21,778 shares

18,775 shares

11,570 shares

11,209 shares

100% (18/18)

100% (18/18)

100% (18/18)

100% (12/12)

Number of shares of
the Company heldRecord of attendance at Boardof Directors meetings (FY2022)
Committee

Hisao Mitsui

Yasuyuki Kuriki Junko Kawamura

Audit & Supervisory
Board Member

Audit & Supervisory
Board Member

Apr. 1979 Joined the Ministryof Education (currently
Ministry of Education,
Culture, Sports, Scienceand Technology, Japan)
Aug.1988 Councilor,
Legislative Bureau of theHouse of Representatives
Apr. 2006 Board Member,
National Institute ofTechnology
Jul. 2008 Director of Private
Education Institution
Department, Higher
Education Bureau,
Ministry of Education,
Culture, Sports, Scienceand Technology
Sep.2011 General Manager,
Department of Facilities
Planning, Minister’s
Secretariat, Ministry of
Education, Culture,
Sports, Science andTechnology
Jan. 2012 Deputy
Commissioner, Agency
for Cultural Affairs
Jul. 2014 Director-General,
Lifelong Learning Policy
Bureau, Ministry of
Education, Culture,
Sports, Science andTechnology
Jan. 2016 Director General,
National Institute for
Educational Policy
Research
Jun. 2016 Counsellor,
Cabinet Secretariat(retired in September
2017)
Apr. 2018 President, Japan
Arts Council (retired in
March 2023)
Jun. 2023 Director, theCompany (current
position)

Apr. 1984 Joined theCompany
Jul. 2006 General Manager,
Personnel Department
Jul. 2011 Deputy General
Plant Manager, Hiroshima
Plant
Apr. 2014 Deputy Director of
Machinery Business
Division
Apr. 2016 Deputy Director of
Research andDevelopment
Headquarters
Apr. 2017 Executive Officer
Oct. 2017 Deputy Director of
New Business Promotion
Headquarters
Apr. 2021 Director of New
Business Promotion
Headquarters
Jun. 2021 Director &Executive Officer
Apr. 2022 Director &Managing Executive
Officer
Apr. 2023 Director, theCompany
Jun. 2023 Audit &Supervisory Board
Member (Full-Time)(current position)

Apr. 1984 Joined theCompany
Oct. 1998 Houston Office
ManagerJun. 2008 Nagoya BranchManager
Sep.2015 Deputy General
Manager, Corporate
Planning Office
Apr. 2017 Kansai BranchManager
Apr. 2019 Deputy Director of
Machinery Business
Division (SalesManagement Supervisor)
Apr. 2020 Representative
Director, President andCEO of GM Engineering
Co., Ltd.
Jun. 2022 Audit &Supervisory Board
Member (Full-Time)(current position)

Apr. 1981 Joined The Mitsui
Trust and Banking
Company, Ltd. (currently
Sumitomo Mitsui Trust
Bank, Limited)
Jul. 2008 Executive Officer,
Chuo Mitsui Asset Trustand Banking Company,
Limited. (currently
Sumitomo Mitsui Trust
Bank, Limited)Feb. 2011 Managing Executive
Officer, Chuo Mitsui Asset
Trust and Banking
Company, Limited.
Apr. 2012 Managing Executive
Officer, Sumitomo Mitsui
Trust Bank, Limited
Jul. 2012 Advisor, Sumitomo
Mitsui Trust Bank, Limited(retired in September
2012)
Oct. 2012 Director and Vice
President, Sumitomo
Mitsui Trust AssetManagement Co., Ltd.
(retired in March 2016)
Apr. 2016 Audit & Supervisory
Board Member, Sumitomo
Mitsui Trust Bank, Limited(retired in March 2017)
Apr. 2017 Advisor, Sumitomo
Mitsui Trust Bank, Limited(retired in June 2017)
Jun. 2017 Deputy Chairman of
the Board of Directors,
Director and Audit &Supervisory Committee
Member, Sumitomo Mitsui
Trust Holdings, Inc. (retired
in June 2019)
Jun. 2019 Audit & Supervisory
Board Member, Sumitomo
Mitsui Trust Business
Service Co., Ltd. (retired in
March 2021)
Jun. 2020 Audit & Supervisory
Board Member, theCompany (current position)
Apr. 2021 Advisor, Sumitomo
Mitsui Trust Business
Service Co., Ltd. (current
position)

Apr. 1982 Joined
MITSUBISHI GASCHEMICAL COMPANY,
INC. (retired in July
1985)
Oct. 1986 Joined Tohmatsu
Awoki & Sanwa (currently
Deloitte Touche Tohmatsu
LLC)
Aug.1990 Registered as a
Certified Public
Accountant
Jun. 2005 Appointed Partner
at Deloitte Touche
Tohmatsu LLC (retired in
December 2019)
Jan. 2009 Member of the
Defense Equipment
Procurement Council,
Ministry of Defense(retired in December
2018)
Dec. 2019 EstablishedYamaguchi Saori Certified
Public Accountant Firm
Representative (current
position)
Jun. 2023 Audit &Supervisory Board
Member, the Company(current position)

0 shares15,232 shares

2,961 shares

1,488 shares

0 shares100% (18/18)

100% (12/12)

100% (18/18)

Director

Director

Apr. 1986 Joined theCompany
Jun. 2015 Deputy General
Plant Manager, Hiroshima
Plant
Apr. 2018 General Manager,
Finance & Accounting
Department
Apr. 2020 Director, Japan
Steel Works M&E, Inc.
General Manager,
Business Promotion
OfficeApr. 2022 Executive Officer,
the Company; In chargeof Export Control
Administration (current
position); General
Manager, Personnel
Department (current
position)
Apr. 2023 In charge of Health& Safety Management(current position)
Jun. 2023 Director &Executive Officer (current
position)

Apr. 1978 Joined Dainippon
Ink and Chemicals,
Incorporated (currently
DIC Corporation)
Apr. 2010 Executive Officer,
DIC Corporation
Jun. 2011 Director andExecutive Officer, DIC
Corporation
Apr. 2012 Representative
Director, President andCEO, DIC Corporation(retired in December
2017)
Jan. 2018 Chairman of theBoard of Directors, DIC
Corporation (retired in
January 2021)
Jun. 2020 Director, theCompany (current
position)
Jun. 2020 Outside Director,
IHI Corporation (current
position)Jan. 2021 Director, DIC
Corporation (retired in
March 2021)
Mar. 2021 Executive Advisor,
DIC Corporation (retired
in March 2023)
Jun. 2021 Outside Director,
Shimadzu Corporation(current position)

Apr. 1978 Joined Kao Soap
Co., Ltd. (currently Kao
Corporation)
Jun. 2006 Executive Officer,
Kao Corporation
Jun. 2010 Director andExecutive Officer, Kao
Corporation
Jun. 2012 Director andManaging Executive
Officer, Kao Corporation(retired in March 2014)
Apr. 2015 Auditor, National
Institute of Technology
and Evaluation (retired inJune 2019)
Jun. 2020 Director, theCompany (current
position)
Jun. 2020 Outside Auditor,
LiveDo Corporation(current position)

Apr. 1979 Joined Tokyo
Electron Ltd.
Apr. 1999 Executive Officer,
Tokyo Electron Ltd.
(retired in March 2005)
Apr. 2005 President &Representative Director,
Tokyo Electron Korea Ltd.
(retired in May 2010)
Jun. 2010 President &Representative Director,
TOKYO ELECTRONDEVICE LIMITED (retiredin December 2014)
Jan. 2015 Corporate Director,
TOKYO ELECTRONDEVICE LIMITED (retired
in June 2015)
Jul. 2015 Representative
Chairman, Tokyo Electron
Korea Ltd. (retired inJune 2018)
Jul. 2018 Chairman, Tokyo
Electron Korea Ltd.
(retired in June 2019)
Jul. 2019 Senior Advisor,
Tokyo Electron Korea Ltd.
(retired in March 2020)
Jun. 2023 Director, theCompany (current
position)

4,327 shares

0 shares461 shares

0 shares100% (18/18)

100% (18/18)—(Chair)Remuneration
Advisory Committee(Chair)—Hiroyuki Shimizu Hiroshi Misawa Saori Yamaguchi
Audit & Supervisory Board
Member (Full-Time)

Director

Nomination Advisory
Committee

Shingo Mito
Audit & Supervisory Board
Member (Full-Time)

Director——

Corporate
Management andGovernance
Finance andAccounting
Legal Affairs, Internal
Controls, and Risk
Management
Personnel, Labor
Administration, andSkill Matrix Human Capital

Information Systems andDigital Transformation
Sales and Marketing
Quality
Manufacturing,Technology, and R&D
Environment

Executive Officers

Takashi Iwamoto

Managing Executive Officer
54 JSW Integrated Report 2023

Seiji Umamoto

Managing Executive Officer

Shoji Nunoshita

Managing Executive Officer

Yoshitaka Sato
Executive Officer

Takeshi Shinmoto
Executive Officer

Masayuki Aoyama
Executive Officer

JSW Integrated Report 2023 55

Message froman Outside Director

56 JSW Integrated Report 2023

The Group has challenged itself, as an ideal for where it wants
to be in 10 years’ time, to achieve net sales of ¥500 billion in
fiscal 2033. To achieve that I think that improving human capitaland managing the business portfolio will be key points.
For the former, in addition to securing demographic diversity,
we also need to secure task-based diversity so as to enhance
the Group’s strengths in R&D, marketing, and global expansion.
In recent years, there has been greater recruitment of external
experts or individuals with experience at other companies, andI hope that the Group will continue to actively push forwardwith this.
In the case of the latter key point, this is something we have
only just started to work on and so discussions are currently
underway. For product groups in which the business divisions
have strengths, it is vital that instead of just changing businessportfolios, we consider how to manage these going forward.
To that end, we need to set KPIs for business evaluations, for
ROIC for instance.
Toward future growth, a Materiality that has been identified is
the realization of a plastic-resource-recycling society. We must
look at both the risks and opportunities associated with this,but I think that it will present us with many business chances.
In addition to the above, there is a need to focus on expanding
the business into new regions globally. I want the Group to
have more in-depth regional strategies that take into accountgeopolitical risks.
JSW Group has been continuously striving for material
innovation and solving social issues. The role that we fulfill as
outside directors is to make the public more aware of theGroup’s strengths and appeal as it works to develop andfabricate the industrial machinery and new materials able toaddress society’s issues. This is the part I will do my best to play.

The Group has established JSW Group Risk Management
Regulations, which clearly stipulate that the Company andGroup companies manage risks in accordance with theirrespective management structures and division of duties, andthat all employees, from officers to general employees, areresponsible for implementing appropriate and effective risk
management in accordance with their respective roles.
In addition, the Company has appointed a director in chargeof risk management (CRO), who oversees risk management of
the Company and Group companies. The Operations
Management Division acts as the risk management
secretariat, and the Company has constructed a risk
management framework based on the three lines of defense
model. The Company is pushing forward with risk
management for the entire Company by strengthening the risk
management divisions, which forms the second of those lines.
Also, to deal with risks by divisional function, divisions such as
those in charge of health and safety, environmental
management and export control management are eachconducting appropriate operations through steps such as
forming committees or putting in place regulations from acompany-wide, cross-sectional perspective.
With regard to company-wide risk management, the Risk
Management Committee (chaired by the CRO) endeavors toshare information on role-specific risks and on evaluations,for important issues, whether potential or apparent problems
in different management organizations. Where necessary, thecommittee responds to these and discusses specific efforts
and as needed utilizes the lines of reporting shown in the risk

management framework diagram to guide or instruct
relevant divisions.
As the third line of defense, the Internal Audit Divisionmonitors risk management, and reports to the Board of
Directors and the Executive Board. Information on major risks
and related efforts are suitably announced via the annual
financial reports and the website.
In the event of a major accident, disaster or any other riskthat could cause serious damage to JSW Group, the Crisis
Management Headquarters, led by the director in charge ofrisk management, is promptly established to offer response.
As the COVID-19 virus spread during the period from fiscal
2020 to fiscal 2022, a Crisis Management Headquarters was
set up to provide functions such as ascertaining the healthstatus of employees, establishing a telecommuting systemand offering response to those infected.
In fiscal 2021, it was revealed that inappropriate conduct inquality inspections by Japan Steel Works M&E, Inc. had takenplace (see p. 40–41 of this report) and this was the case of an
operational misconduct risk that manifested itself in the quality
assurance process. After this discovery, in September 2022,
the Group set up the Quality Management Office to control
quality assurance functions and by as clarifying the functionsof the second line of risk defense in risk management (under
the three lines of defense model), it has strengthened the work
processes and the management framework to secure work
suitability and efficiency. In these ways, the Group is striving toprevent recurrence.

Risk Management Framework
Board ofDirectors

Reporting
Reporting of major matters

Risk Management Committee
Selection of major risks; discussions, instruction, and advice about risk countermeasures; information sharing[First Line of Defense]
Business execution divisions
Business divisions
PlantsGroup companies, etc.
Business execution as a risk owner[Second Line of
Defense]Risk management divisions[Third Line of
Defense]Internal Auditors Office

Support for risk countermeasures
Advice/guidance

Risk management secretariat

Sharing status of

Support management divisions

risk countermeasures

Support for the first line—such as setting the direction of risk
countermeasures—and management of risk

Auditing

Tackling Issues with an Eye on
Long-term Targets

Framework

Information sharing

In response to the inappropriate conduct by one of our
subsidiaries, Japan Steel Works M&E, with regard to productchecks, JSW Group is working to ensure it does not happen
again and these measures have been evaluated as appropriate.
We are making steady progress, first with framework andsystem reforms, such as organizational changes andsystemization. That said, the corporate culture is somethingthat has taken root, formed as it was over many years of theCompany’s history. It is therefore not something that can betransformed overnight, but top management needs to continue
promoting that message. President Matsuo is frequently visiting
M&E and different plants, and we are working hard to take up
opinions from those on the frontlines wherever possible.
The Group’s plants have impressive frontline capabilities, andseem to have discretion in how they act. Firstly, M&E shouldhave a sense of urgency in promoting reforms and rolling theseout within the Group to other plants too, and I hope thatthrough these and similar measures, the Group will continue towork on these in earnest. It is important that information on thisprogress is also communicated to stakeholders on a regularbasis. I too will play my part in offering proper advice andoversight to management so that the Group can once again
earn the trust of society as soon as possible.

Instruction/advice

Need for Steadfast Publicization of
Reforms by Top Management

Outside Director

JSW Group’s businesses, and bolstering JSW Group’s
management foundation for sustainable growth. Based onthese, we will encourage awareness that there are both risks
for the sake of sustainable growth that should be taken
actively and risks that should never be taken, even if for thesake of making profits. We will also carry out appropriate andefficient risk management.

Reporting

As an outside director, I recognize that my role is to monitor
management, and so while ensuring I remain objective as I
oversee the executive side (those in charge of businessexecution), I must also look at things from their perspective andbe careful to neither watch on as a passive bystander nor to
criticize needlessly. During communication with the executive
side, I utilize my experiences from my own time in management
and take care so that they can make use of my knowledge as
an outside director. Also, throughout revisions to the Corporate
Governance Code, we outside directors had more
opportunities for direct dialogue, whether it be Q&A sessions at
general meetings of shareholders or small meetings withinvestors. I think our role in this area is growing.
Three years have now passed since I was appointed back in
2020, and in that time the Company’s governance structure
has steadily been strengthened. In April 2022, the Liaison
Council of Outside Officers was established. At its meetings,
we receive advance explanations of items on the Board of
Directors’ agenda, and can check the content of discussions
by the Executive Board and the Management Council. Then, in
2023, we went for a system that clearly separates oversight by
the Board of Directors from business execution of businessdivisions. In the same year, we saw the Company appoint its
first female outside director and outside Audit & Supervisory
Committee member. As well as enhancing diversity, this change
has resulted in four of the nine directors (44.4%) being outside
directors, and as such the Board of Directors is shifting to moreof a monitoring role.
On the other hand, if there is one issue that stands in theway of strengthening the effectiveness of the Board of
Directors, it is a sense of urgency. I do feel that this is
somewhat lacking when it comes to implementing the PDCA
cycle for instructions and advice at the Board of Directors.
We need to further strengthen monitoring if we are to speed
up the “check” and “action” steps of the cycle. Anotherproblem to address is strengthening Group governance atoverseas subsidiaries. As overseas sales increase,governance at the subsidiaries will become increasingly
important, and the Company will need a system in place thatcan lead the entire Group. Looking to the future, there is alsoa need for more full-on discussions into CEO succession
plans. It is a topic that requires time, and one I hope we will
cover properly.

Yoshiyuki Nakanishi

The Company and other companies in the Group work to
avoid and mitigate different types of risk, and manages theseto keep their impact to a permissible amount. In this way, theGroup recognizes that working on continuous development
and sufficiently fulfilling its social responsibilities are importantmanagement issues.
In selecting Materiality, the Group considers two
perspectives: creating value and solving social issues throughInstruction/
adviceStrengthen Our Governance System andEnhance Its Effectiveness

Basic Approach

Committee
composition

Expectations for Steady
Reforms and Efforts Focused on
Meeting Long-term Targets

Risk Management

JSW Integrated Report 2023 57

Compliance
JSW Group has established its Standards of BusinessConduct and engages in business activities in compliancewith ethics, laws and regulations, and international rules inboth letter and spirit. In particular, the Group will continue to
conduct business activities based on the understanding thatcompliance is not only legal compliance, but also includes
adherence to internal rules and contracts, and is an importantelement for building a relationship of trust with society as well
as a fundamental driver for increasing employee engagement.
In addition, the Board of Directors has decided on the Basic
Policy on Internal Control and is developing internal control
systems. Recognizing the importance of the proper operationof these systems, the Internal Control Committee regularly
reports on matters relating to internal control and its progressto the Board of Directors. The Group will also review its Basic

Policy on Internal Control to ensure quality compliance andprevent the recurrence of inappropriate conduct.
Regarding compliance with codes such as laws andregulations, and internal rules, on a regular or as-neededbasis, the Internal Auditors Office audits the overall operationsof JSW, and reports the results to the Board of Directors andAudit & Supervisory Board, as well as the representative
director & president and, the Executive Board or theManagement Council, or other relevant parties, as necessary.
In fiscal 2022, there were no violations of relevant laws andregulations* that resulted in fines or penalties.
*Relevant laws and regulations: Laws and regulations regarding the environment,
Industrial Safety and Health Act, Financial Instruments and Exchange Act, laws
and regulations regarding export control administration, laws and regulations
regarding competition, laws and regulations regarding bribery, and Whistleblower
Protection Act

charge of risk management, investigates reported cases, andif a problem is identified, the committee will take appropriate
action and implement corrective measures. During thisprocess, the office of the Whistleblowing Committee and Audit& Supervisory Board members share information as
appropriate, while the Audit & Supervisory Board members
monitor the progress made in individual cases and the statusof operation of this system. In principle, the Board of Directors
confirms proper operations of the whistleblowing system twicea year, as based on reports from the Committee.
The number of reports made was 16 in fiscal 2021 and 42
in fiscal 2022, most of which were consultations about
workplace environment, including instances of harassment.
As a result of changing the contact point for whistleblowing toexternal specialists, and efforts to raise awareness of thesystem, the number of reports—which includes those fromGroup subsidiaries—is increasing. Reports were investigatedby the Committee and appropriately addressed.

Information Security
Basic Approach

Promotion of Compliance Training
The Company is implementing the following measures to further enhance compliance awareness.
• E-learning for JSW employees and Group company officers and employees was offered to enhance compliance awareness and ensure

thorough risk management. (In fiscal 2022, the participation rate was 97%)
• Harassment awareness videos, which are required viewing by managers are streamed on the company intranet. (Can also be viewed bygeneral employees)• Information and articles are posted on the in-house portal site launched in October 2022, intranet noticeboard, posters, and newsletters to

help raise awareness of compliance.
• E-learning was provided for employees of the Company and Group companies to ensure compliance with laws, regulations and internal rules

on export control administration. (In fiscal 2022, the participation rate was 100%)• Internal mock examinations, preparatory courses for examinations and e-learning were provided to increase the number of current employees
who have passed the export control administration practical skills certification examination.
• Intellectual property education seminars were held online for managers of technical divisions to learn more about the technical scope of
patented inventions and their application.
• Information security training was enacted for all employees.
• The president and director in charge of quality throughout the Company posted video messages on the company intranet. As part of Quality
Compliance Month in May 2023 and the National Quality Month in November 2023, the Company implemented e-learning and quality
compliance training via educational videos.

Whistleblowing System
JSW Group has formulated and operates whistleblowing rules
for the purpose of strengthening and promoting compliancemanagement, and has established a system for the proper
handling of reports and consultations from employees andothers regarding potential organizational or individual violationsof laws and regulations that may have been committed by
employees or others associated with JSW or Group
companies. This enables JSW Group to promptly detect
potential violations of laws and regulations and take corrective
action, thereby minimizing risk and damage to the Group thatwould otherwise arise from such a violation. This system
brought about events such as the discovery of inappropriate
conduct in quality inspections by Japan Steel Works M&E,
Inc. (see p. 40–41 of this report) and the system is functioning
effectively in line with these goals.
Anonymous reports and consultations are accepted and

58 JSW Integrated Report 2023

disadvantageous treatment of persons who make reports or
seek consultation is prohibited. In the event of
disadvantageous treatment received, the Company will
respond with appropriate measures, including disciplinary
action. In October 2021, the whistleblowing rules wereamended so that the contact point for whistleblowing waschanged to external specialists in order to ensure greater
protection for the confidentiality of whistleblowers andindividuals with whom they consult, while also reducing thepsychological burden of whistleblowing. Furthermore, in orderto facilitate further awareness of the whistleblowing system toreach even Group subsidiaries as well, we display the manualon internal workplace bulletin boards and have distributed apocket version of the manual that employees and others canrefer to at any time.
The Whistleblowing Committee, chaired by the director in

There is a continued increase in the importance of information and information systems in improving the efficiency of office
work and production technology, as well as speeding up decision-making. At the same time, threats such as information
destruction, leaks, and tampering and system destruction due to cyberattacks are increasing, and the risks associated withinformation and information systems are on the rise. In this environment, in order to continue to maintain the satisfaction andtrust of customers and to fully fulfill our role, we recognize that an important management challenge is to accurately identify
information-associated risks and protect both the information entrusted to us by customers and the information and systems
necessary for us to do business.

Framework

Training

The Chief Information Security Officer (CISO), appointed byresolution of the Board of Directors, oversees information
security measures at JSW. Persons in charge of information
security management and information security administrators
are assigned at the Head Office and each plant. The Information
Security Committee, chaired by the CISO, comprehensively
discusses the status of information security incidents, recent
threats to information systems, the environment in which theCompany operates, and opinions and requests regarding theusability of various security measures, and conducts detailed
verification on a regular basis.
In addition, we are constantly working to maintain andimprove security while continuously evaluating the adequacyof countermeasures against various cyber-attacks based on
detailed analysis results from continuous monitoring data fromone of Japan’s leading security vendors.

We conduct information security training (e-learning) for JSW
officers and employees to improve their security awarenessand literacy.

Information security risk
assessment–(Implemented with every major
system change)

Structure of the Information Security Committee

Information leakage
communications assessment

Information leakage
communications assessment overallrating: A(no communications corresponding
to information leakage)

Chair: Chief Information Security Officer (CISO)
Executive Office: Office of Information Technology, Head Office
Head Office ommittee members (each division)
CPersons in charge of information
security management• 
Information security administrators••

Each plant ommittee members
CPersons in charge of information
security management• 
Information security administrators••

Participation Rate in Information Security Training (E-Learning)
Participation rate

FY2020

FY2021

FY2022

99.3%

100%

100.0%

Evaluation by Third-Party Organizations
Diagnostic Assessments in FY2022
Assessment*

Results of evaluation* Assessments consist of intrusion inspections and vulnerability assessments ofcompany network systems, based on information security benchmarks andcarried out by security vendors with information security management system(ISO/IEC 27001) certification.

JSW Integrated Report 2023 59