MEIDENSHA REPORT2015

Editorial policy

Meiden Group Corporate Philosophy
Corporate Mission

Illuminating a more affluent
tomorrow
We continue to create value and technologies for therealization of a more affluent and environmentallyaware society.

Value Provision

For customer peace of mind
and satisfaction
We offer complete environmental consideration andappropriate support for our customers.
From product design to commissioning, our highly skilled
staff help customers solve various issues and realize
their dreams by providing high-quality, socially
responsible products and services.

Since fiscal 2013, Meiden Group has issued the Meidensha
Report combining our annual report and CSR report.
Meiden Group aims to fully integrate our business andCONTENTS
Meiden Group Corporate Philosophy

01

Message from Management

03

prosperous tomorrow. We hope that the Meidensha Report

Meiden Group Businesses

07

will inform and let our readers know about Group-wide

Financial / Non-Financial Highlights

09

initiatives for achieving our Corporate Philosophy.

Overview by Business Segment

11

Medium-term Management Plan13

CSR initiatives. This will let us better support the social
infrastructure people need and lead the way to a more

SPECIAL FEATURE
Meiden Group Corporate Philosophy
Corporate Mission
It defines the raison d'être and corporate mission

Value Provision
It defines the unique value provision and core competence

Under the Meiden Group’s definition of CSR, “Each and every
employee shall work to realize the Group’s corporate philosophy sothat the Meiden Group is needed by society.”

2 Corporate Code of Conduct
This code defines compliance in conducting our CSR programs andactivities.

3 President’s CSR Policy Order
1 CSR Definition

2 Corporate Code of Conduct

This policy sets forth the policy of our CSR programs and activities in themedium term. The Policy Order asks each Group employee to implement
CSR programs and activities in their daily work. We will draw up
specifications that reflect the given business climate and CSR challenges
under the then current stage of the POWER 5 management plan.

4 MEIDEN CYCLE
3 President’s CSR Policy Statement

4 MEIDEN CYCLE

Challenges of Meiden Group

1 CSR Definition

MEIDEN CYCLE shows the guiding spirits shared by all members of theGroup in realizing the Group’s corporate philosophy.

Scope of Report
Reporting period
This report mainly covers initiatives taken in fiscal 2014
(April 1, 2014 - March 31, 2015)

1

Scope of Report
The report mainly covers initiatives of Meidensha Corporation(“Meiden”) and its Group companies. Human resources dataapplies to Group companies in Japan, while environmental reporting2

data applies to Meiden and 41 major Group companies (23 in Japanand 18 overseas).
Guidelines Used as References• GRI “Sustainability Reporting Guidelines Version 4”

3* Although this report is based on the reporting principles, thecontent does not necessarily conform to them.

MEIDEN CYCLE• Ministry of the Environment “Environmental Reporting Guidelines(Fiscal Year 2012 Version)”4

We contribute to the spreadingof renewable energy resources by
converting rich water
resources into power

17

We support a stable power supply
with lightning protection devices
renowned worldwide for theirreliability and track records

19

We support various infrastructure
systems in many parts of the world
through our high-quality
engineering services

21

We promote diversity programs andincrease the competitive edgeof our Group23

Publication• Publication of this report: September 2015

Build Loyalty

Build Loyalty

Keep in Touch
In order to realize our Group Corporate Philosophy, we must
identify the direction for each individual employee to aim towards
and provide signposts to help them proceed without losing theirway. To enable us to do so, we have made these five actions ourwatchwords. The actions are mutually linked, with one action
calling forth the next, creating a cycle of action and growth. Basedon this image, we call this the Meiden Cycle.
By sharing and practicing the Meiden Cycle as the ethos
underlying our actions, we seek to maximize the growth cycle foreach of our employees. And at the same time, this means that the
Meiden Group continues to grow sustainably, looking towards therealization of the Group Corporate Philosophy.

01

MEIDENSHA REPORT 2015

To realize the “best product experiences” for the customers, let’s
produce the new added-value.
Take a pride and responsibility that you are engaged in the job that iscreating the “backbone or social infrastructure of the society.”
Make a solid growth as a personal level as well as the corporate leveland should reach the level of being “admired” or “trusted” withloyalty by the stakeholders.
Do not be afraid the potential conflict of opinion with the “associates”
and keep in touch with each other beyond the mental barrier.
Have a genuine dialogue with the “customers” to learn their insights.
Have a consciousness of being in touch with the community, thesociety and the global climate.

Think Big

“Is this O.K.?” : Put a question to the status quo.
“Inquisitive mind” and “curiosity.” : You should keep such mind habit.
“The road leading to a solution is not just one” : Please explore every
possibility.

Move Ahead“Act now or perish.” : Take a first step with your strong will.
“Action of today will make your future.” : Make your way towards thegoal without hesitation.
“Come from your own action with the challenging target” : Take apositive action.

Have Fun

Let’s enjoy the moment of “personal growth.”
Let’s sincerely enjoy your “job.”
Let’s get “the passion for Manufacturing Excellence”• Next scheduled publication: July 2016

A Foundation for Building Value

Inquiries about the CSR Report

Corporate Governance

25

General Affairs & Public Relations Division,

Compliance27

Risk Management

28

General Affairs & Public Relations Section
ThinkPark Tower, 2-1-1, Osaki, Shinagawa-ku,
Tokyo 141-6029 Japan

Research and Development /TEL: 81-3-6420-8100

Capital Investment /Intellectual Property

29

Quality and Product Safety

31

Protection of the Environment

33

In addition to past and current facts about Meiden Group, thisHuman Resources Management

37

report contains forecasts for the future based on plans, outlooks

Supply Chain Management

39

Social Contribution Programs

40

Outline of Meiden Group41

FAX: 81-3-5745-3027
Website: http://www.meidensha.co.jp/pages/top/index.html
Disclaimer

and business policies and strategies in effect at the time of
publication. These forecasts are our assumptions and judgments asbased on information available at the time they were stated, andmay differ from actual business activity results and events in futureowing to changes in conditions. Thank you for your understanding.

MEIDENSHA REPORT 201502

Message from Management

We aim to become a Company Group trusted bysociety through our social contributions.
While keeping “Our Passion for Manufacturing Excellence,”
we hope to grow our business.

Wrap-up of POWER 5 Phase III and its Business Climate

emerging economies, particularly in Asia. We expect there will be solid market

We were able to pave a new way to expand overseas
businesses in markets showing growth potential.

demand in the infrastructure markets such as power, sewage and drinking― Please wrap up the results of POWER 5 Phase III for us.

The new Medium-term Management Plan, V120

In our Medium-term Management Plan POWER 5 Phase III, we were able to

By projecting our ideal future in fiscal 2017 (120th
anniversary year) and beyond, we aim to have astrong market presence and become a company
group trusted by society.

expand growth areas such as environmentally conscious products including our“motor drive system for pure and hybrid EVs” and “PCSs for solar power,” andwe were able to grow these businesses to the level contributing to thewater treatment and rail.

profitability of our overall business. As a result, despite a turbulent andchallenging business environment, we positioned our Group on a new growth
track by turning around our overall performance.

Yuji Hamasaki
Representative Director
President
Meidensha Corporation― You created a new Medium-term Management Plan,
V120.

While we could not reach our target of an overseas sales contribution rate

Fiscal 2017 will mark the 120th anniversary of the Meiden Group. In formulatingof 30%, we did increase our ratio significantly, from 13.9% in the initial year of

our new Medium-term Management Plan, we looked beyond fiscal 2017 and

POWER 5 Phase III, to 24.3% in the final year. We will continue to work hard andvisualized a future ideal image of the Meiden Group as a “heavy electric

aim to make a leapfrog growth at our overseas markets.

machinery supplier in support of social infrastructure building and withsustainable growth and development power. ” In order to get there, we drafted― How do you see the coming management climate for the
Meiden Group?

our “V120” management plan as the Group’s ideal image in fiscal 2017.

For infrastructure markets in Japan, we can expect some construction demandsustainable, offer better products and services and contribute the progress of

impact from the 2020 Tokyo Olympics and Paralympics. At the same time, we

society. In the previous medium-term Management Plan, POWER 5, we realized

can now see large changes in market needs and challenges in the power-related

our target of turning around our overall business and putting it on the proper

businesses due to the business model changes in the power utilities (such as

recovery track. In our new management plan, “V120,” we aim to produce a

separating the power generation and distribution operations) and rethinking ofvirtuous cycle for our sustainable growth as a social infrastructure builder atthe energy resources portfolio. However, given the medium and long-term

home and abroad. To be specific, we will strengthen our profit generating bases

perspective, it is difficult to predict a market scale increase. We need to face thein our Japanese businesses and work on expanding the Group’s size by growing

The major missions of the Meiden Group are to make the Group

Reflecting the results of fiscal 2014

These products are for three segments with medium and long-term growthissues from the declining population, financial difficulty in the national and local

overseas. In order to get there, we will beef up our competitive edge, especially

We worked hard to build the business’s growth
foundations and grow overseas. Our Group
performance in fiscal 2014 produced solid results.

potential: “Power Energy Systems,” “Auto and Public Transportation Systems

governments and the drive towards offshoring at private companies. We expectthat of our core heavy electric products (e.g., electric motors, which have been

like Rail” and “Water Treatment Systems.”

such factors are the prelude to the age of downsizing of our markets in Japan.

our signature products since our founding.)

As a result, the Group recorded consolidated sales of 230.299 billion yen

In overseas markets, medium- and long-term growth is expected in the(up 14.122 billion yen year on year), operating income of 11.163 billion yen (up― What was your year of fiscal 2014 in review?

1.616 billion yen year on year), ordinary income of 10.502 billion yen (up 2.711

When I think back on the business environment of fiscal 2014, I view it as a year

billion yen year on year) and net income of 6.868 billion yen (up 0.287 billion yenof mild sustained economic recovery. Against the backdrop of fiscal policy andyear on year).
Strategic Importance of our Medium-term Management Plan V120

monetary easing policy, it demonstrated the correction of the high yen and highTarget identity

stock prices throughout the year. However, when I look at the global situation,
there was increasing tension in the Middle East and concern for the economic

Results for consolidated orders, net sales, and income

slowdown of the emerging nations. I view that uncertainty of business climate(million yen)

Fiscal 2014 (Planned)

Fiscal 2014 (Results)

Orders received

240,000

241,232

Management Plan POWER 5 Phase III. In order to achieve at our target numeric,Net sales

230,000

230,299

we worked hard to build foundations for growth and to grow overseas. This was

Operating income

10,50011,163

Ordinary income

9,500

10,502

Net income forthe current period

6,000

6,868

will remain.
For the Meiden Group, fiscal 2014 was the final year of our Medium-term

made possible by offering competitive products such as transmission anddistribution (T & D) products, power generation products and power conversion
products, or by offering unique original products featuring ICT technologies.

03

MEIDENSHA REPORT 2015

Corporate
expansion

V120(FY2015〜2017)

FY

2014

Increased
profitability

FY

2017

A heavy electric machinery supplierthat supports the future of social
infrastructure and has sustainablegrowth and development
potential*See pages 11-12 for details of results for each segment.

MEIDENSHA REPORT 201504

President’s CSR Policy Statement
Society

Environment

Human
resources― Tell us about the basic concept and policies of V120.

― Tell us about the strategy of each business segment

is essential to build a beneficial and strong partnership with local companies.

Under V120, we will inherit the results of POWER 5 Phase III and will leapfrog

We can broadly divide the Meiden Group’s business into three segments:

Further, for the earliest development of innovation in technology, it is necessary

from recovery phase to growth phase. Based on this basic concept, we will

“Social Infrastructure Business,” “Industrial Systems Business” andto actively promote joint research programs with the leading universities,

realize both targets: “Beef up the Profit Base in Japan Operations” and “Grow“Maintenance and After-sales Service Business.”

technical institutions and other companies of the same or different industries.

Management foundation of our business activities
Compliance, Corporate Governance and Risk Management

First, regarding our “Social Infrastructure Business,” we aim to beef up theUnder V120, we will actively promote the policy of “Build new partnerships,”

By strengthening these building blocks of management foundation, we hope to further cultivate thecorporate culture necessary for CSR management.

First, regarding “Beef up the Profit Base in Japan Operations,” we will

power transmission and distribution (T & D) products business by expanding our

reinforce efficient and speedy technical development and secure new sales andbusinesses for overseas rail companies and sales to the overseas production

business channels.

[ Environment ]seek to innovate our business models in order to maintain our profit level against
the expected demand decrease in the infrastructure markets in Japan. To behubs of Japanese subsidiary companies. At the same time, we will make more

In addition, we will investigate the ideal future conditions of each businessspecific, we will seek to increase our product competitiveness and reinforce ourinroads into the overseas power utilities markets, mainly focusing on the ASEAN

unit and each Meiden Group company and define the future directions (selection

system technologies by actively using ICT and IoT technologies. In addition, weand the Middle East markets. In the area of power generation products, we are

and focus) of our key businesses. In so doing, we will be able to allocate ourwill work hard to enhance our ability to provide solutions proposals to ourseeking to increase our lot orders from Japanese and overseas prime mover

management resources such as human resources (HRs) properly and implement

We accept our responsibilities as good corporate citizens through many initiatives, including:resolution of customer issues; promotion of community involvement and proactive communication;
proper information disclosure at the correct time, etc.

customers and increase added value. These goals will be realized by improving(engine or turbine) suppliers. In our systems business, we will increase our

the resource-shift to the high-growth areas.

[ Human resources ]our “one-stop services” for overall facilities, which covers

product

revenue in existing fields in Japan by increasing our ability to provide proposals

In order to further increase our corporate value, we will also work on

manufacturing, maintenance and inspection, facility management and operation

to our customers using ICT or our “one-stop services.” We will also focus our

improving our corporate governance based on the Corporate Governance Codemanagement.

efforts to expand overseas, such as in overseas rail projects. We will seize thejointly drafted by Japan’s Financial Services Agency (“FSA”) and the Tokyo StockRegarding “Grow Overseas,” we aim to grow our businesses following theopportunity of renovation demand for small and medium-sized hydro power

Exchange (“TSE”), which entered into force on June 1, 2015. We will makegrowth of the emerging nations by making inroads into the social infrastructure

plants in Japan. We will seek to win overseas projects and aim to work on

efforts to formulate our policies and improve our systems to ensure proper

businesses there, with a key focus on Asian markets. To date, the Meiden Group

expanding new growth areas.

corporate information disclosure and promote dialogues with investors. We will

the appointment to management positions of our local staff members

seek to further increase the efficiency and fairness of our corporate(engineers, sales and administration). In addition, we will promote diversity, by

management.

working to change awareness and upgrade our personnel system in order toOverseas.”

has extensive track records in the area of private industry and rail in Southeast

Regarding “Industrial Systems Business,” we will strive to develop the

Asia and the Middle East. Going forward, we will create more business focusedbusinesses of our unique products such as energy-saving and environmentallyon overseas power utility fields by making inroads there. In addition to

conscious high-efficiency products, motor drive products, vacuum condensers,

significantly increasing our local sales and technical personnel and improving

etc. Specifically, we will focus special efforts on opening new business fields

The Meiden Group’s CSR activities

quality assurance and after-sales maintenance service systems there, we willthrough our new innovations in technology, such as our recently developed

implement investments for growth in a speedy and proactive manner.

transformer-less medium voltage inverter with the world’s highest level ofThrough our business activities, we will promote
our programs to contribute to society

In order to realize the two strategic targets of V120, it is essential to beef

efficiency and a compact design. In our systems business, we will reinforce ourup the competitive edge of ourability as a solutions provider and aim to leapfrog to be a system integrator in the

products. In this regard, we

automotive key component development process.

Promote strategic environmental management
We contribute to society through the offering of products and services for the environment andenergy. At the same time, we will work to reduce the environmental impact of our business activities.

[ Society ]Provide values needed by society

Produce work that gives pride to our employees andcreates positive working environments
We will tackle these issues: create a positive working environment that brings out the best potential
and unique talents of each employee; promote better work-life balance; and develop abundant anddiverse talent, as human resources are precious to the Group.

provide female employees, the staff of Group companies, and employees over

― Tell us the Meiden Group’s programs to promote CSR
activities.

60 years of age greater chances to demonstrate their abilities in the workplace.
By drawing on our long-standing technological power and by cultivating
HR, we will make consistent efforts to make our Group needed by society.
To our stakeholders

We will steadily grow through our “Sense ofMission,” “Power of being in Touch,” “Agility” and“Passion for Manufacturing Excellence.”

Lastly, concerning our “Maintenance and After-sales Service Business,”

In addition to working hard to reduce the carbon footprint from our business

April 1, 2015 to produce “Strong

we will expand our maintenance service scope to include machinery andactivities, it is important that we contribute to society in terms of energy and theProducts” in our core Meiden

equipment. At the same time, we will reinforce our “One-Stop Service Offering”

environment through the Meiden Group’s businesses, products and service

Group products.

to overall facilities including key equipment production, maintenance andofferings. In fiscal 2012, we enacted the “Meiden Group Environmental Vision”

The following three values are the greatest assets of the Meiden Group:

Under this reorganization,

periodic inspection, facility management and operation management. Throughto contribute to society with sustainable growth. With the changing energy•“Sense of Mission” in support of the social infrastructure;

we established four “product-such service offerings in Japan, we will capture the outsourcing needs for public

policies in Japan and the challenges faced by global climate control issues, we•“Power of being in Touch, ” which refers to the deep level of communication

driven business units,” whose

utility facility management and operation, as well as those for extending the life

were able to see that there will be growing opportunities to which we canacross the wide spectrum of networks with our customers andmission is to expand our productof infrastructure facilities. In so doing, we aim to increase our profitability. In

contribute in alleviating energy and environmental issues through the Meiden

across-the-board co-operation among Meiden Group companies; andbusiness by increasing productaddition, we will reinforce our maintenance services system in the emerging

Group’s technologies and innovation development power.

•“Agility,” which refers to our ability to respond quickly and flexibly to meet thecompetitiveness (see page 14),

nations – mainly in Asia – and work hard to grow our business in maintenanceand one “new product planning

services for renewable energy system fields.

The source of power that promotes our business activities is definitely ourneeds and solve the problems of our customers.

human resources. The Meiden Group’s CSR activities imply “Practicing theDuring the nearly 120 years since our founding in 1897, we have beenGroup’s corporate philosophy by each and every employee to make the Meiden

engaged in the continuous innovation of various technologies as a supplier ofwhose mission is to launch new― Tell us about the key policies under V120.

Group needed by society.” We stand on the perspective that the common

heavy electrical industry. Our long years of history reflect our spirit of challenge

products for the future.

In order to support implementation of the growth strategy of V120, we will

ground enabling all of our business strategies at the Meiden Group is our

known as “passion for manufacturing excellence.” Through these values andpromote four key policies: “Build new partnerships,” “Shift management

personnel. We will strive to secure global talent and will actively promote thepassion, we will work to contribute to creating an affluent future society withresources following the designated business directions,” “Set and implement

deployment of right people at the right workplaces inside the Meiden Group.

sustainable growth. At the same time, we aim to increase our corporate value.

financial targets” and “Reinforce corporate governance.”

Specifically, we will assign young employees overseas, provide more training

We would like to ask all our shareholders, together with our customers

programs for our local engineers at our training facilities in Asia, and promoteand business partners, to continue providing us with your support and advice.

In offering “One Stop Services” for the social infrastructure businesses, it

MEIDENSHA REPORT 2015

vitiesation of our business acti

created an reorganization on

and development business unit,”

05

Management found

MEIDENSHA REPORT 201506

7

Meiden Group Businesses

Substations
6

Since its inception in 1897, we have been engaged in the innovation of various
technologies, products and services as well as the constant pursuit of improvement
for the benefit of the society as an electrical equipment manufacturer.
This reflects our spirit of challenge to meet the expectations of the times by ourcustomers and society and our “passion for manufacturing excellence.”

11

Hydroelectric power plants

Wind turbine power plants
Supervisory control anddata acquisition (SCADA) systemfor power stations and substations

Transformer

Hydraulic turbine generator

3

Railways
Wind turbine generator system

Meiden Customer Center

Vacuum circuit breaker

694Traction substation for
railwaysProtection relay &control panel for“Shinkansen Line”

4
3

7

10

Solar power plants
5High-rise buildings

2
2

1

8

Automobile plants

1

Mega solar farm

Factories

12

PV Inverter

8Electric vehicles (EV)Parks (place for disaster refuge)

Elevator inverter

Motor drive systemfor elevators

12

5

Dynamometer
Dynamic voltage compensator

11

9

10

Drinking water treatment plants
and Sewage treatment plants

In-house power generation system
PV power generating system

Mobile power generating system

Hospitals
Drive system for EV
Disaster information
management system

Industrial controller

In-house water supply system

Vacuum condenser
Total monitoring system forwater supply and sewage
systemAutomated guided vehicle (AGV)

Meiden Group History
The first 1 Hp three-phaseinduction motor
built by Meiden(1901)

Construction of Meiden Osaki Works (1912)

07

MEIDENSHA REPORT 2015

1897

• Establishment of company

1912• Construction of Meiden Osaki Works

1917• Registration as limited company(Establishment of Meidensha Co., Ltd.)1935• Construction of Meiden Nagoya Works

1937• Construction of Meiden Shinagawa Works

1939• Construction of Meiden Nishio Works

1955• Technological alliance with AEG(air-blast breakers and transformers)

1958• Opening of Head Office in Chiyoda-ku, Tokyo

1961• Construction of Meiden Numazu Works,
commencement of operation of transformer factory
Technological alliance with ASEA (turbine generators)

1968• Technological alliance with GE (VI)

1969

1970

Operation and Maintenance,
Outsourcing Service for Facility
Management• Technological alliance with SEVCON (electricalappliances for forklift trucks)• Technological alliance with AEG (thyristor
rectifiers, processing lines)• Construction of system equipment and device
factory in Numazu• Technological alliance with GE (synthetic fiber
heaters, control equipment, large DC devices)

1972• Adoption of the term “powertronics”

1973• Technological alliance with GE (high-frequency
thyristor inverters)

1976• Opening of Gotanda Office

1977• Construction of Meiden Ohta Works

1979• Opening of factory in Singapore

1980• Adoption of the phrase “Powertronics &mechatronics”

Sling hoist

1983• Adoption of the phrase “Powertronics,
mechatronics & electronics”

1987• Holding of technology exhibition as a 90th
anniversary project

1993• Construction of Meiden R & D Center

1995• Transfer of Head Office to Chuo-ku, Tokyo

1997• Celebration of 100th anniversary

2000• Establishment of Japan Motor & Generator Co.,
Ltd. through three-way merger to oversee
high-voltage motor and low- andmedium-capacity generator business2001• Transfer of power transformation business(transformers, breakers, switchgear, etc.) to
Japan AE Power Systems Corporation

2003• Merger with Meiden Engineering Co., Ltd.

2006

2007
2008
2009

2012

2013

Cogeneration system(combined heat and power system)• Absorption of motor development and manufacture
operations by Kofu Meidensha Electric Mfg. Co.,
Ltd. via corporate divestiture• Establishment of Meiden Hangzhou Drive Systems
Co., Ltd., commencement of production of motors• Celebration of our 110th anniversary• Transfer of Head Office to Osaki, Shinagawa City,
with completion of ThinkPark Tower• Appointment of Keiji Kataoka as Chairman and
Junzo Inamura as President• Formulation of Medium-term Management Plan
POWER 5
• Business and capital alliance with Ono Sokki Co.,
Ltd. in the area of automotive testing instruments• Dissolved Japan AE Power Systems Corporation(AEP), a T & D business joint venture of Hitachi, Fuji
Electric and Meiden, to allow better organizationand separated growth and Meiden inherited someof the AEP businesses.
• Technological alliance with Myanmar-basedtransformer manufacture and sales company Asia
General Electric Co., Ltd.

2014

2015

• Appointment of Junzo Inamura as Chairman andYuji Hamasaki as President• Transfer of maintenance and inspection services
business to Meiden Engineering Corporation,
Meiden Engineering East Japan Corporation,
Meiden Engineering Central Japan Corporation, andMeiden Engineering West Japan Corporation
through corporate divestiture• Capital alliance with India-based transformer
manufacture and sales company Prime Electric
Limited• Merger of Meiden Kankyo Service Co., Ltd. andMectechno Co., Ltd. to form Meiden Facility Service
Corporation• Release of the new medium-term management
plan, “V120”• Consolidation of four firms (see 2013) performing
maintenance and service business into Meiden
Engineering Corporation and Meiden O&M
Corporation• Acquisition of Tridelta ÜberspannungsableiterGmbH from Tridelta GmbH (see Page 20)

MEIDENSHA REPORT 201508

Financial / Non-Financial Highlights

Meidensha Corporation and Consolidated Subsidiaries

Financial indicators

FY2010FY2011FY2012FY2013

FY2014

Net sales (millions of yen)

167,729

181,107

197,733

216,177

230,299

Overseas net sales (millions of yen)

27,31825,25737,97745,70455,864

Overseas sales ratio (%)

16.3

13.9

19.2

21.1

24.3

Operating income (millions of yen)

5,778

6,279

7,881

9,547

11,163

Net sales (millions of yen)Overseas sales ratio (%)

Operating income (millions of yen)

216,176

11,163

230,299

4,613

5,266

5,946

7,790

10,502

Net income (millions of yen)

1,196

1,679

4,025

6,580

6,868
16.3

Net assets (millions of yen)

52,72253,422

58,07760,60767,405

Total assets (millions of yen)

206,871

211,733

224,623

248,379

255,519

Net assets per share (yen)222.56225.63251.64262.50291.35

Net income per share (yen)

5.27

7.40

17.74

29.00

30.27

2010

7,881

13.9

2011

21.1

19.2

2012

24.4

24.2

25.4

24.0

25.9

Return on equity (%)

2.3

3.3

7.4

11.3

10.9

6,279

4,025

24.3

1,679
1,196

2013

2014

FY

Total assets (millions of yen)

Equity ratio (%)

6,868

181,106

5,778

Ordinary income (millions of yen)

6,580

9,547

197,733
167,729

Net income (millions of yen)

2010

2011

2012

2013

2014

2010

FY

Net income per share (yen)

2011

2012

2013

2014

FY

Cash flows from operating activities (millions of yen)
Cash flows from investing activities (millions of yen)
Cash flows from financing activities (millions of yen)
18,239Cash flows from operating activities (millions of yen)

14,71011,443

9,306

18,239

11,165

Cash flows from investing activities (millions of yen)

(4,318)(5,640)(7,136)(11,316)(8,772)

Cash flows from financing activities (millions of yen)

(9,599)(5,048)(7,749)(3,873)(5,282)

248,379 255,519
206,871 211,733

29.00

30.27

14,710224,623

11,44317.74
0Notes: 1. Net sales figures do not include consumption tax, etc.

-4,318

5.27

Number of consolidated subsidiaries

FY2010FY2011FY2012FY2013

40

43

42

39

Japan

26

25

26

25

21

Outside Japan

13

15

17

17

18

Number of employees

6,994

7,145

7,920

8,047

8,173

33

39

40

42

42

CO2 emissions (Japan) (kt-CO2)

Notes: 2. Figures for employee numbers exclude those employees on temporary contracts.
3. The historic Federation of Electric Power Companies (FEPC) nationwide average electric power CO2 coefficient (receiving end) for each year through FY2013 wasused to calculate CO2 emissions for that year. The historic coefficient for FY2013 was used for calculating FY2014.
4. With the dissolution of the joint venture Japan AE Power Systems Corporation, the Japan AE Power Systems Corporation Numazu Works (AE Power Numazu)
was incorporated into the Meiden Group as Meiden T&D Corporation in April 2012. CO2 emissions figures for FY2010-2011 include data for AE Power Numazu.

For the Meiden Group, fiscal 2014 was the final year of our Medium-term Management Plan POWER 5 Phase III. In order to achieve our target
numeric, we worked hard to build foundations for growth and to grow overseas. This was made possible by offering competitive products
such as transmission and distribution (T & D) products, power generation products and power conversion products, or by offering uniqueoriginal products featuring ICT technologies. These products are for three segments with medium and long-term growth potential: “Power
Energy Systems,” “Auto and Public Transportation Systems like Rail” and “Water Treatment Systems.”
As a result, the Group recorded consolidated sales of 230.299 billion yen (up 6% year on year), operating income of 11.163 billion yen(up 16.9% year on year), ordinary income of 10.502 billion yen (up 34.8% year on year) and net income of 6.868 billion yen (up 4.4% year
on year).

09

MEIDENSHA REPORT 2015

-5,640-9,599

2010

2011

2012

2013

2014

FY

Number of employees

7,920
6,994

7,145

2010

2011

2010

2011

2012

2013

2014 FY

2010

2011

-5,282-7,136-7,749FY201439-3,873-5,048

7.40

Non-financial indicators

11,1659,306

2012-8,772-11,31620132014 FY

CO2 emissions (Japan) (kt-CO2)

8,047

8,173

39

40

42

42

2012

2013

2014

33

2012

2013

2014

FY

2010

2011

FY

MEIDENSHA REPORT 201510

Overview by Business Segment

Social Infrastructure Systems Business

Fiscal 2014
Consolidated net sales in fiscal 2014
increased 6.5% over the previous
fiscal year to ¥230,299 million, while
operating income grew 16.9% to¥11,163

million.

Breakdownbybusiness segment is shown on theright.

Consolidated Sales

230,299
Millions of yen

Net Operating Income

11,163This sector includes the manufacture and marketing of equipment for
emergency and non-emergency power generation, hydroelectric power
generation, and power transmission and distribution facilities. We sell theseto power companies, government agencies, railways, and buildings andfactories in Japan and abroad. Other products include traction substations
for railways. We provide the product offerings of power quality stabilization
systems or power generation systems such as solar, wind and hydro power
and offer energy solution services such as smart grid systems.
We are also involved in the fields of drinking water and seweragetreatment for local governments in Japan. Our activities include
manufacturing and sales of electrical facilities for water processing systems
and the related products and services: process control systems and ICT
system improvement services. We also offer solutions services such as
contract facility management services for drinking water treatment plants.

Net sales in the segment increased 7.8% over the previous fiscal year to ¥141,014 million,
while operating income grew 13.9% to ¥6,414 million.
Regarding the social infrastructure systems business, there were needs for renovation ofaged facilities at the power utilities and increasing demands for the hydro power systems inJapan. In this fiscal year, we faced a difficult business climate including such issues as thepower utility’s suspension of grid connection applications by independent power producers ofrenewable energy resources in Japan, etc. Yet, the sales of converters for solar power
remained strong during this fiscal year and we also experienced goods sales for transmission
and distribution (T&D) products as well as power generation systems for private facilities. In
total, this business recorded increases in revenue from the previous fiscal year.
Sales of the water and environmental business increased over the previous fiscal year.
Orders from the renovation projects of large-scale sewage treatment plants in Japan and salesof our drinking water treatment facility management service contributed to this increase.
Sales from the overseas system business increased over the previous fiscal year. For
markets in the ASEAN nations mostly in Singapore, we sold T&D facilities for power utilities andtraction substation facilities for rail and T&D facilities for Japanese firms’ overseas production
hubs. Such sales contributed to the increase.

Industrial Systems BusinessThis sector includes the manufacture and marketing of motors andinverters for elevators, textile machinery, industrial vehicles, and electricvehicles. Other products are vacuum capacitors and industrial
computers for makers of semiconductor manufacturing equipment.
We also manufacture and market dynamometers and other testing
systems for automobile manufacturers, and logistics support systems
for factories and warehouses.

Net Sales

Millions of yen

130,7242013

141,014
5,633

2014

Net Sales
Reflecting the recovery trend of active private capital spending in the manufacturing sectors ingeneral such as auto and steel in Japan, the net sales in this segment increased 7.7% over theprevious fiscal year to ¥55,414 million and the operating income grew 88.8% to ¥2,941
million.
Our motor and inverter business saw increased sales over the previous fiscal year.
The steady demand for our the motors and inverters for Mitsubishi Motor Corporation’s
Outlander PHEV, electrical components for forklifts, motor drive units for semiconductor
manufacturing systems and for elevators, and motors for injection molders contributed to theincreased sales.
The segment’s dynamometer and logistic systems business remained at the same level asin the previous fiscal year. The steady demands of our testing system for R & D facilities ofJapanese overseas hubs and the production items transportation system for production lines
contributed to the sales.

Net Operating Income

FY

Millions of yen

2013

Millions of yen

6,414

2014

Net Operating Income

FY

Millions of yen

55,41451,440

1,557

2,941

Millions of yen
2013

Net Sales

197,733

Millions of yen

216,177

Net Sales

Engineering Systems BusinessThis sector provides services relating to the remote management andmonitoring of facilities and the proposal of measures for extending thelife of facilities, energy conservation, and other such services related
primarily to the maintenance of products we supply. We also engage inthe maintenance of semiconductor manufacturing equipment and thereconditioning of used manufacturing equipment.

230,299

As the Japanese business climate showed a recovery trend, the demands for our maintenanceservices increased and we secured many new project orders by offering “one-stop field
services.” The temporary merger cost increases due to the consolidation of four maintenanceservices companies into two in Japan (see Page 8, 2015) subsided. The net sales increased
2.2% over the previous fiscal year to ¥29,773 million and the operating income rose 31.3%
over the previous fiscal year to ¥2,582 million.

2012

2013

Net Operating Income

2014This sector includes rentals of real estate holdings, including ThinkPark
Tower (Osaki, Shinagawa City, Tokyo).

29,1222014

FY

Millions of yen

3,285

2013

9,547

Other BusinessThis sector includes marketing companies not tied to specific businessfields, and companies that contract accounting, payroll, and otheradministrative functions, as well as welfare services for employees.

11

Net Operating Income

FY

Millions of yen

29,773

Net Sales
The Group is engaged in the real estate leasing business, centering on the office andcommercial building ThinkPark Tower (Osaki, Shinagawa City, Tokyo). The net sales in thesegment totaled ¥3,289 million – nearly the same level of the previous fiscal year, andoperating income amounted to ¥1,240 million.

2014

2013

2,582

2014

Net Operating Income

FY

Millions of yen

3,289

1,229

1,240

2013

2014

Millions of yen

7,881

2013

2013

1,965

11,1632012

FY

Millions of yen

2013

Real Estate Business
FY

2014

2014

MEIDENSHA REPORT 2015

FY

Net Sales
This segment includes categories not included in any of the above segments, such as
Manufacturing and marketing of electrochemical measuring equipment and electric insulationmaterials, welfare services for employees and good merchandising.
Due to the impact of the consolidation of the Group companies in Japan and subsequent
segment category change of some companies, etc., net sales decreased by 15.9% from theprevious year to ¥20,467 million and operating income fell by 50.1% from the previous fiscal
year to ¥423 million.

FY

Millions of yen

24,354

Net Operating Income

FY

Millions of yen

20,467848

2013* From April 1, 2015, we changed our conventional segment names from “Engineering Systems Business Segment” to“Maintenance and Service Business Segment.”
This is merely a name change and does not affect the content of the segment information.

2014

2014

FY

2013

423
2014

MEIDENSHA REPORT 2015

FY

12

Medium-term Management Plan

The Meiden Group started V120, a Medium-term Management Plan, which is a three-year plan from fiscal 2015 to fiscal
2017. The plan represents our strategy that will realize both targets: “Beef up the Profit Base in Japan Operations” and“Grow Overseas.”
The Meiden Group will welcome its 120th Anniversary in fiscal 2017, which is the final year of V120. By
implementing V120, we will gain the traction for the new growth and we also aim to increase corporate value.

The Concept of V120

2017

FY

2014
230.2 billion yen

Consolidated
sales

POWER5Phase III• Grow the businesses of growth potential
and develop new businesses

Ideal
Group
VisionFY

V120 (FY2015〜FY2017)

270.0 billion yen

Heavy electrical supplier withsustainable growth and development
potential by supporting social
infrastructure buildings for the future.

V120• Beef up the Profit Base in Japan Operations• Grow Overseas• Beef up Product Competitiveness• Sustainable growth and development athome and abroad by virtuous growth cycle• Growth and development by integratingproducts with broader system and by
virtuous growth cycle

Develop Competitive Products and Create a Better Future.

Ideal Group Vision:

Heavy electrical supplier with sustainablegrowth and development potential by supportingsocial infrastructure buildings for the future.
Origin of the name of the plan:

Our growth vision to make our 120th
anniversary special in FY2017
Under V120, we will focus on “Beef up the ProductCompetitiveness,” especially our heavy electrical productsthat have been our core and early-day products of Meiden
Group. We will build a virtuous cycle of sustainable growth
at home and abroad.
SloganV120

Develop Competitive Products andCreate a Better Future.

Key Phrases (Acronym “MIRAI” (meaning ‘future’ in Japanese)):Make better productsInternational drive
Relationship management withcustomers and key partners
Additional Value to the maximum level
IoT Age Challenge

13

MEIDENSHA REPORT 2015

V120 Basic Policies and
Key Action Plan
[ Three Basic Policies]❶ Beef up the Profit Base in Japan Operations❷ Grow Overseas❸ Beef up Product Competitiveness(T&D products, power generation products, power conversion products,
and motor drive application products)❶ Beef up the Profit Base in Japan Operations
Given the anticipated decline in demand in the Japanese
infrastructure market, the Group will work to change ourbusiness model with added value in order to maintain andimprove our profitability. We will also improve productcompetitiveness and system technologies by actively using
our ICT and IoT technologies. We will strengthen our“one-stop services” by providing comprehensive contract
offerings
ofprocurement,
product
production,
maintenance & inspection service, facility management,
and up-to-facility-operation management. In so doing, we
will improve our problem-solving proposal power to ourcustomers and increase our added value.

Japan

Overseas

Change the business modelthrough added value

Grow business along with “therise of nations”

V120• Strengthen thesystem technologies
and productcompetitiveness by❶adding ICT and IoT.
Beef up the Profit• Strengthen ourBase in Japan“One-stop Service”
offerings
Operations❷

Grow Overseas• Expand business in
ASEAN emerging
nations• Strengthen oursales, sales
engineering andmaintenanceservices• Make investment for
growth❸ Beef up Product CompetitivenessBeef up product competitivenessequals
Improve price competitiveness + make original and unique products• Deploy the business strategy with the consistent and vertical integration of productdevelopment, production and sale (four newly established business units (BUs) eachhaving such activities under one BU) manufacture, and sales• Build new partnerships❷ Grow Overseas

By making inroads into the social infrastructure-building
sectors in emerging nations mostly in Asia, we will grow ouroversea businesses along with “the rise of the nations.” In
addition to private industry and rail sectors in ASEAN
nations and the Middle East where we have extensive
supply records, we will focus on entering into businesses foroverseas power utility sectors, will greatly increase the local
sales and engineering staff members and will work on to
improve our quality assurance and after-sales maintenanceservice systems there. We will make investment for our
growth in a timely manner.

❸ Beef up product competitivenessWe will work on strengthening our product competitivenessby benchmarking our heavy electrical products such as T&D
products, power generation products, motor drive
application products and industrial components in terms of
quality, originality and price level. In so doing, we will create“strong products.”
In order to make an effective implementing organization
for the above plan, we newly established four
product-driven business units (BUs) for T&D products,
power generation products, motor drive application
products and industrial components on April 1, 2015 as partof our organizational changes. Each BU will implement a
consistent business strategy to make product development,
production and sales under one arm of the BU organization.
By increasing the integration between the system andour individual products, we will work to solve the issues andrealize the needs of our customers in the social
infrastructure sectors (energy, public transportation andwater) at home and abroad. In so doing, we will realize
sustainable growth and development.

[Four Key Action Plans]❶ Build new partnerships❷ Shift management resources based on “business direction”(selection and focus)❸ Set and implement financial targets❹ Strengthen corporate governance❶ Build new partnerships

To make “strong products” and business growth, we will
actively work on building “new partnerships” at home andabroad, such as with other firms in different businesssectors, universities and research institutions. In so doing,
we will strengthen our technology power in an efficient andspeedy manner and make products with competitive edge.
Further, by acquiring new sales and product distribution
channels, we will develop new markets and increase ourmarket share.
ONO SOKKI CO., LTD.
Joint
businessonautomotive testing systems
and our stock investment

ORGANO CORPORATION
Joint business in drinking water andsewage treatment system sector for
public water utilities in JapanEAMLEngineering
Co., Ltd.

Prime Meiden Ltd.
in India

Water Processing
Public Water
Utility Sector

Foster stronger relations with existing partners

Meiden Group
Build new partnerships

Different sector firms

Local suppliers inemerging nations

Public utility sectors athome and abroad

Research institutions❷ Shift management resources based“business direction” (selection and focus)on

We will review the “ideal” operations of BUs and Groupfirms, as well as how each BU or Group firm should share
the business functions. In so doing, we will formulate the“direction” (selection and focus) of the business. Throughsuch exercises, we will implement effective distribution ofmanagement resources such as HR and strengthen the
migration of management resources into high-growthareas.

❸ Set and implement financial targets

To deal with the changing business climate, we will improve
our financial shape to realize sustainable growth.
We will set financial targets aimed to realize ourobjectives: improve self-capital by improving the
profitability, improve the free-cash-flow level by effective
use of assets, and secure a stable financial position byrealizing various methods of capital procurement. We will
work on improving our financial shape by achieving thefinancial targets through Group-wide efforts.

❹ Strengthen corporate governanceTo comply with the “Corporate Governance Code,” we will
promote programs to reinforce corporate governance.
Through such programs, we will further improve
management efficiency and fairness.
In addition, we will continue to implement our investor
relations (IR) programs and Shareholder relations (SR)programs. Through such programs of enhanced
information disclosure, we hope to fulfill our accountability
for our shareholders and investors.

MEIDENSHA REPORT 201514

SPECIAL FEATURE

Strategies for each business segment❶ Social Infrastructure Business
Products business
Regarding Meiden Group’s core product portfolio in thissegment, which includes T&D products (transformers,
switchgear, surge arresters) and power generation products(engine generators, turbine generators, mobile gensets), we will
focus and continue our efforts in strengthening thedevelopment of such environmentally conscious technologies
as vacuum insulation technologies and core fundamental
technologies for higher efficiency and more compact design. In
so doing, we will realize our policy of “Beef up the productcompetitiveness.”
In T & D products, we will increase the local sales andengineering personnel at Meiden Singapore Pte. Ltd. who are
overseeing our operations in Asia. We will also improve andreinforce the sales and production hubs in ASEAN nations andthe quality assurance and after-sales services there. We willdevelop the business for overseas rail sectors, the business for
production hubs of Japanese subsidiaries in the ASEAN
Region and the business for the power utility sector in ASEAN
nations and the Middle East Region.
In addition, we will promote business development for themarkets in India and the Western Asian countries by utilizing thesales channels and T&D products production capacity of our
joint venture in India, Prime Meiden Limited, founded in March
2014. For power generation products, we will aim to increase
large-quantity order sales for prime mover suppliers (engine or
turbine) at home and abroad. We will work to secure orders for
new renovation needs of small and medium-scale hydro power
plants in Japan and will also try to secure orders for overseas
hydro power projects.
Systems business
By strengthening our solutions proposal power by effective useof our “one-stop service” offerings, we will realize increasing the
profitability in our existing strong fields in Japan such as power,
rail, water-processing and broadcasting. Further, in new
growth fields such as integrated EMS using the power
conversion system for energy storage and storage batteries,
we will work hard to make such businesses our key
businesses.
We will grow our businesses for overseas rail projects andceramic flatsheet membranes for sewage water treatment
plants, etc.

❷ Industrial Systems Business
Products businessWe will work to expand sales of environmentally conscious
and unique products (motor drive units for plug-in hybrid cars,
pure EVs, elevators and forklifts; vacuum capacitors, etc.).
Regarding the motor drive units for EVs, we will increase our
supply to other automakers by improving our corefundamental technologies for higher efficiency and morecompact design as well as our serial production technology.
Currently, we succeeded in technical development of theworld’s smallest-sized and highest-efficiency transformer-lessmedium voltage inverter. We also made new technicaldevelopment for high-speed motors. Through such R & D
programs, we will develop our businesses in new fields.
Systems businessFor dynamometer testing systems, we will work on reinforcing
our solutions proposal power by improving our simulation

15

MEIDENSHA REPORT 2015

Challenges of Meiden Grouptechnologies on engine vibrations, etc. and by establishing a“simulation model base” development support tool. In sodoing, we aim to make a big leap forward as a system
integrator for automotive analysis and evaluation.

❸ Maintenance and Servicing BusinessWe will work to expand the scope of the maintenance services
from conventional services for mostly electrical facilities to include
services for mechanical facilities. At the same time, we willreinforce our “one-stop service” offerings for overall facilities that
include product productions, maintenance & inspection services,
facility management services, and outsourcing services for plant
operation management.
By offering such a variety of services, we will quickly seize
the outsourcing needs for public utility facilities such as facility
management and operation management, as well as the needs
for extending the life of infrastructure systems. Through such
efforts, we would like to improve the profitability of our services.
We will work on improving the maintenance service
systems in emerging nations, mostly in Asia, and will continue
to work hard to develop business for maintenance services forrenewable energy resources (wind and solar power, etc.).

Meiden Group started a new Medium-term Management Plan – “V120” covering the three-year period from fiscal
2015 to fiscal 2017. V120 has a strategy to realize both “Beef up the Profit Base in Japan Operations” and “GrowOverseas.” Under the V120, we will devote our efforts to increasing the competitive edge of our products,”
especially our heavy electrical products – our founding period products of Meiden Group. We aim to create avirtuous cycle for sustainable business growth at home and abroad.
At the same time, Meiden Group will also contribute to society both in Japan and abroad by means of the

Financial targets(Unit: 100 million yen)

FY 2014 results

FY 2015 estimate

FY 2017 target

2,302

2,350

2,700

Operating income

111

115

140

Ordinary income

105

110

135

Net income*

68

75

90

Net sales

We aim to become a heavy electrical industry
supplier in support of future social infrastructures
and with sustainable growthand development potential

Group’s high quality and reliable product-making, our innovations in technology and R & D power. By drawing on
our long-term experience and by cultivating our human resources (HRs), we will make incremental progress byworking hard to become the company group needed by society.

* Projected fiscal 2015 current net income and target fiscal 2017 current net income is current net
income attributable to shareholders in new companies(Unit: 100 million yen)

FY 2014 results FY 2015 estimate

1,410
64
554
29
297
25
32
12
8
(20)
2,302
111

Net sales

Social Infrastructure
Systems

Operating income
Net sales

Industrial Systems

Operating income
Net sales

Maintenance
Service

Operating income
Net sales

Real Estate

Operating income
Net sales

Other(including eliminations)Operating income
Net sales

Total

Operating income

1,450
65
560
32
300
26
33
12
7
(20)
2,350
115

FY 2017 target

1,660
77
630
40
340
32
34
12
36
(21)
2,700
140

1
2

Profitability target
FY 2014 results FY 2015 estimate FY 2017 target
ROE

10.9%

10.9%

At least 10%

ROA (Operating profit basis)

4.4%

4.4%

At least 5%

3

We contribute to the spreadingof renewable energy resources by convertingrich water resources into power

17

We support a stable power supply withlightning protection devices renowned worldwide
for their reliability and track records

19

We support various infrastructure systems
in many parts of the world through our
high-quality engineering services

21

We promote diversity programs
and increase the competitive edge of our Group

23

Investment Plan
Cumulative amountFY 2014 results FY 2015 estimate FY 2015~2017 over three years
Capital investment

8.8 billion yen

9.6 billion yen

Growth investment
budgetR&D expenses

At least 28 billion yen
Scale: 12 billion yen

10.2 billion yen 10.3 billion yen

Dividend ratio
Consolidated dividend ratio: Target of 30%

At least 30 billion yen

4

MEIDENSHA REPORT 201516

SPECIAL FEATURE 1

1

Challenges of Meiden GroupWe contribute to the spreading of
renewable energy resources by convertingrich water resources into power
Among the power generated from renewable energy resources such as solar, wind, geothermal, biomass, etc., hydro-power
offers the most stable power supply. Not only limited to general rivers, small-scale hydroelectric power systems can be
sewage facilities, erosion-control dams, etc.). Due to this reason, there are many possible project sites for hydroelectric
power systems at home and abroad. Recently, there is a growing attention toward hydroelectric power for its future growthpotential.
Drawing on more than 100 years of experiences in generator control technology in hydroelectric power, Meiden– A 450kW small-scale hydroelectric plant inPhongsaly Province, Laos –Laos, a key nation in the Mekong Delta Region, is located in
the center of the Indochina Peninsula. The government of
Laos established a target to realize 90% electrification of
the country by 2020. The electrification rate of Phongsaly
Province, in Laos’ northernmost region, is 23% (as of July2012), the lowest figure among all of Laos’ 17 provinces.
Phongsaly Province buys power from China to compensate
for their power shortage.
This project has the target of increasing theelectrification rate in the Gnot-Ou District of Phongsaly
Province from 32% to 60%. As a Japanese ODA project, a450kW small-scale hydroelectric power plant wasconstructed. It uses our small-scale hydroelectric powersystem. The completion of this power plant realized theprovision of electricity access to about 580 households in
10 villages.
Supplying power
to villages without
power accessrealized the most effective hydroelectric power system operation at high efficiency to suit a given water volume.

PRC

Special Featureestablished in any area in which there is a certain level of drop and flow of water (agricultural waterways, drinking water andBringing power to villages
without electricity access.

A variable-speed submersible
turbine generator

A small-scalehydroelectric facility sitein Phongsaly Province

Vietnam

MyanmarA Foundation for Building Value

Laos
Vientiane

ThailandCambodia

Outline of Meiden Group

TOPICS
More Stock Investment and Working Closelywith EAML Engineering Co., Ltd.
In order to get more project orders from hydro-power, one of the renewable energy resources, we
strengthened our business alliance with EAML Engineering Co., Ltd., a Japanese company
specializing in small and medium-sized hydroelectric systems.
EAML Engineering is strong in small and medium-scale hydroelectric power systems. By
conducting joint product development programs to realize improvements in their hydro-turbines –higher efficiency, compact design, lower costs and by demonstrating the maximum synergy effects
from the business alliance, we would like to grow our small and medium-scale hydro-power systembusiness.

Completion ceremony of main factory rebuilding
work at EAML Engineering Head Office

A 450kW small-scale hydroelectric plant in Phongsaly Province, Laos

17

MEIDENSHA REPORT 2015

MEIDENSHA REPORT 201518

SPECIAL FEATURE 2

2

Challenges of Meiden GroupWe support a stable power supply withlightning protection devices renowned
worldwide for their reliability and track records
In August 2014, the IEEE1, the world’s largest professional association of electrical and electronicengineers headquartered in the U.S., designated the world’s first gapless metal oxide surge arrester
received the awards in Japan and Meiden’s MOSA is the first in the country to receive the IEEE
Milestone for an individual heavy electrical product.
The award was granted in recognition of the MOSA’s enhanced resistance against multiple
lightning strikes and contamination – weak spots for the conventional gapped-type surge arrester –and for making significant contributions toward the development of arresters.
Our developed MOSAs are known around the world as a purely Japanese technological innovation for power devices and the MOSA technology has been adopted as the world standard. Even about
40 years after its first release, this technology is still playing an active role as a mainstream technol-*2 IEEE Milestone
An award that honors a historical
technological achievement developed at least
25 years in the past, which is recognized ashaving made a significant contribution tosocietyogy for world surge arresters for power systems.

A Foundation for Building Value

Surge arresters are devices that protect power equipment
such as transmission lines and transformers from theovervoltage damage resulting from lightning strikes, etc. They
prevent power outages and ensure a stable supply of power.
Meiden’s MOSAs (trade name “SORESTER”) as well as
zinc oxide elements are sold in Japan and exported to morethan 70 countries worldwide.
In the power sector business, given the rising power
demands from the economic development and urbanization in
the emerging nations, we expect there will be increasing
capital spending on power infrastructure systems. We believe
there will be high growth potential in the long- andmedium-term range for MOSAs as a protection device forpower systems.
Going forward, in order to realize a more compact MOSA
design, we are working on developing high-performance andcompactzincoxideelements. In addition, we also
engage in the development ofpolymer-type
MOSAs
featuringcompact
andlightweight design and withexcellent anti-contamination
and anti-seismic resistance.
In so doing, will focus on thedevelopmentofenvironmentally conscious Zinc oxide elements
MOSAs.

Special Feature(MOSA) that we developed in 1975 as an IEEE Milestone2. Twenty-six technological innovations*1 The Institute of Electrical and Electronics
Engineers (IEEE) is the world’ s largest
professional association for engineers in theelectrical and electronics fields. Based in theUSA, the IEEE has more than 420,000
members from 190 countries throughout theworld, and plays a leading role in the areasof electrical, electronic, information andcommunications technologies.

Preventing power outages due tolightning strikes

Polymer-type MOSATOPICSFor sales growth in global MOSA markets
Meiden agreed with TRIDELTA GmbH of Germany to acquire its surge arrester supplier company, TRIDELTA Überspannungsableiter GmbH (TRIDELTA)
and completed the transaction with TRIDELTA in June 2015.
With acquisition of TRIDELTA, Meiden Group now has three surge arrester business hubs in Japan, China and Germany. By expanding its sales,
technical and production capabilities, and by optimizing the production bases for different products and through joint product development programs,
we will provide high-quality and high-performance surge arresters to global markets.

Outline of Meiden Group

Contract signing ceremony with TRIDELTA(Top) The award presentation ceremony(Bottom) The IEEE Milestone plaque19

MEIDENSHA REPORT 2015

In 1975, Meiden delivered the world’s first 66kv MOSA for power systems
for Kyushu Electric Power Co., Inc.

MEIDENSHA REPORT 201520

SPECIAL FEATURE 3

3

Challenges of Meiden GroupWe support various infrastructure systems
in many parts of the world through our
high-quality engineering services
Regarding power facilities, every country has differing laws and standards and each also has many related regulations andrules for acquiring clearance on the facilities and on the materials to be used. Should any trouble occur at the facility, it is vital
The Meiden Group has overseas engineering service bases in Thailand, Malaysia, Singapore, Indonesia, the U.S. andChina. In each country, we have local engineers (who are familiar with local regulations and rules) and Japanese engineers.
We offer engineering services and resolve the various issues related to overseas construction projects and facility maintenance. We offer the same high-quality engineering services as in Japan and provide the proper technical support services. We
provide the full spectrum of support to our customers, drawing on our global perspectives and varied know-how.

In April 2014, we established the Meiden Southeast Asia Training
Center in the suburbs of Bangkok, Thailand to provide maintenanceengineering training.
The Training Center was established to improve the overall
engineering capability of our service engineers there. It includes theengineering knowledge and skills related to the installation andmaintenance of not only electrical facilities, but also machinery
facilities. In so doing, we intend to gain further trust from ourcustomers in the Southeast Asian region where Meiden Group has along history of doing business.
We conduct practical training programs using the actual
facilities available in the Meiden Southeast Asia Training Center,
Meiden Electric (Thailand) Ltd. and Meiden Singapore Pte. Ltd. We
thus cultivate good field service engineers. Further, eligible
participants are not limited to our overseas Meiden Group engineers,
and we also offer training programs for the customer’s engineers toenable them to learn maintenance skills and specific knowledge.
The participating members of the programs are able to learnsuch professional engineering knowledge as design, installation andmaintenance, and also to receive training on such basic practices as
quality control (QC), safety control, etc., for which we practice andaccumulate knowledge and experience in Japan.
We hope, through such learning experience from our programs,that participating members will increase their awareness as a Meiden
Group member and strengthen the personal connections with otherservice engineers across the company line.

Overseas sales contribution

3.2

point year-on-yearincrease

21.1%

Targets for Medium-termManagement Plan V120
(Fiscal 2015~2017)30%

FY2013

FY2012or moreFY2014

Number of overseas employees

1,086

24.3%
Special Feature

to have quick field service support from suppliers.

Opening of Meiden Southeast
Asia Training Center

1,147

1,096

FY2013

FY2014
A Foundation for Building Value

Our overseas engineers receiving technical training

External view of Meiden Southeast Asia Training Center

Outline of Meiden Group

Preventing facility shutdown
before it happens

A training session for our Southeast Asian engineers

21

MEIDENSHA REPORT 2015

Meiden Group offers “One-Stop Services” based on our facility
lifecycle engineering. Our services utilize our unique maintenancetechnologies for various facilities – beginning with electrical facilities.
In countries with our engineering service hubs, we offer “Japan
Quality” high-level engineering services (field and technical support)
to meet the needs of our customers. The services are based on ourservice systems there and draw on our long-term service
experiences in Japan.
MEIDENSHA REPORT 201522

SPECIAL FEATURE 4

4

Challenges of Meiden GroupWe promote diversity programs andincrease the competitive edge of our GroupThe world economy has witnessed the rise of globalization and we now live in a “borderless society” with business
transactions occurring across national boundaries. As we seek to realize a 30% overseas sales contribution to consolidated
becoming increasingly diverse.
In Japan, we face a declining birthrate and a growing proportion of elderly people, and the nation’s productive working
population is projected to decline by more than 10 million between 2000 and 2020. Given such a background, for thesustainable growth of the Meiden Group it is a vital challenge for us to utilize our human resources (HRs) without focusing on
nationality or gender.
Given the above background, since fiscal 2014 the Group has strengthened its diversity programs. By adopting fairpersonnel evaluation systems that enable diversified members of our Group to demonstrate their individual potential, we aim
to increase the competitive advantage of our Group and increase our corporate value.

– Meiden Group’s “Awareness-raising” programsand “Improvements of Various Personnel Systems” –A workplace inspection tour for female employees

A seminar on how to balance workand elder nursing care

Talented team with passion to win in global competition

Existing employees

New employees

All current employees will
demonstrate their ultimate job
performance

The best talent will be chosen towork at the Meiden GroupAn environment that allows all of ourGroup employees be highly
motivated and demonstrate theirpotential

Our culture is to evaluate
on the basis of competence
and ability rather than
attributes

Review and change in-housetraining programs● Improve training programs● Obtain input●

Awareness-changing
programs

Personnel systems reform●●●

Review of personnel evaluation system and merit-based fair treatment
More working options to allow flexible work styles (staggered working hours,
half-day holidays, etc.)
Create a positive job-continuation environment (childcare and nursing care leave,
return-to-work program, etc.)

Technical training for our local engineersfrom our retirement-age engineers

We have reviewed the conventional generic working style (working
at the same place, same time) and we aim to provide more flexible
working options to fit each employee’s working style. As a way toincrease job efficiency, we started trial “work-from-home”
programs.
In so doing, we aim to cultivate a corporate culture ofevaluating job performance on job results, not working hours. We
aim to create a working environment where employees cancontinue to work and demonstrate their potential against issues
such as child-care, elder nursing care, disease, injury, etc.

Example of a work-at-home timetable
Time

Activity Items

7:30

Drop the child at the nursery school

7:45~8:15

Household work (cleaning and laundry)

8:30~12:30

Get a call from the manager andrespond to his request

time (including a visit to the city
12:30~13:30 Lunch
office for an application)some documents and send
13:30~17:30 Preparethem by e-mail17:30~18:00 Prepare dinner
18:15~

Pick up the child at the nursery school

A workplace scene at Meiden Asia, Singapore

23

MEIDENSHA REPORT 2015

MEIDENSHA REPORT 201524

Outline of Meiden Group

TOPICS
Work-from-home programs

A Foundation for Building Value

In order to enable our employees to develop their talents
without regard to their personal attributes, and thus boost
our competitiveness, we believe that it is essential to doaway with the evaluation of employees based on factors
such as gender, age, nationality, years of employment andacademic record, instead becoming an appealing
company that evaluates its employees’ work fairly and acompany able to excel globally.
The Meiden Group intends to effectively utilize our HR
in three genres:❶Female employees
We are working hard to realize a positive workplaceenvironment in order to prevent unfair evaluations againstmaternity leave or child-care leave, or due to the favoring ofmale employees.
❷Overseas local talent and employees of Group
companies
For the local talent of overseas Group companies andemployees of Group companies, we will work to build thepersonnel systems to ensure competence andability-based promotions and better treatment.
❸Employees of 60 years of age and above
To best utilize employees with rich professional expertisesuch as technical knowledge and work experience, we willoffer various working options that allow them todemonstrate their abilities by passing on their professional
know-how to young employees, etc. These options aredesigned to suit their “second working life.”

Meiden GroupSpecial Feature

revenue, the Meiden Group’s business is also going global, and the nationalities of our customers and business partners are

Our programs to promote diversity

A Foundation for Building Value

Corporate GovernanceWe strive to conduct corporate management in a fair, highly transparent, fast and efficient manner and to improve thegovernance structure to secure the fairness of business practices.

Corporate Governance System
Basic Approach

The Governance Structure to Secure the Fairness ofBusiness Practices
1. System to ensure the directors’ performance of their duties complies

Policy Actions Update *As of June 26, 201525

MEIDENSHA REPORT 2015

Corporate Governance Structure: Supervision andManagement and Internal Control System
General Meeting of Shareholders
Board of Directors(includes two outside directors)
Representative
Directors
Executive
Officers

Board of Corporate Auditors(includes two outside auditors)
Accounting Auditor

Internal
Auditing Unit

Each Business Unit

Compliance Committee
Compliance Manager

Compliance Hotline

Board of Directors

Representative Director,
Chairman

Representative Director,
President

Junzo Inamura

Yuji Hamasaki

Representative Director,
Executive Vice President

Representative Director,
Executive Vice President

Koichi Yamamoto

Kozo Masaki
Director and Senior Managing Executive Officer
Mamoru Sugii

Outside Director
Hiroyuki Takenaka

Director and Senior Managing Executive Officer
Tadayoshi Machimura

Outside Director
Kazuhiro Takada

Representative Director,
Executive Vice President

Takeshi Miida
Outline of Meiden GroupIn June 2003, the Company adopted an executive officer
system. At the same time, we sought to reinforce thefunctions of the Board of Directors. For a part of these
efforts, we separated the “decision-making authority andsupervisory functions” and the “business performance
functions” from the Board of Directors. The former functions
were assigned to the Company’s directors, and the latterto the representative directors and executive officers who
were delegated duties by the representative directors. As
a result, the Board of Directors is responsible for making
decisions from the standpoint of the entire Group, and foroverseeing the overall management of the Group.
Two of the ten members of the Board of Directors
are outside directors.* This structure is designed to

As of June 26, 2015

A Foundation for Building Value — Corporate Governancewith applicable laws and regulations and the terms of the provisions in
the Articles of Incorporation
2. System to manage and store information relating to the directors’
performance of their duties
3. Internal rules and risk management system against risk-causing losses
4. System to secure directors’ efficient execution of their duties
5. System to ensure employees’ performance of their duties complies withapplicable laws and regulations and the terms of the provisions of the
Articles of Incorporation
6. System to ensure appropriate business conduct by the group comprising
the Company as well as its subsidiaries
7. Matters relating to employees who assist the performance of duties bycorporate auditors
8. Matters relating to the separation of corporate auditors assisting
employees from the supervision of the directors
9. System for directors and employees of the Company and subsidiaries toreport to auditors, and other systems pertaining to reporting to auditors
10. Matters pertaining to procedures for advance payment or reimbursementof costs arising from the performance of auditors’ duties and policies
relating to performance of said duties
11. Other systems to ensure effective enforcement of auditing by the
corporate auditor

Board of Directors / Corporate Auditors

Special Feature

In order to realize the Group’s philosophy, we view it isessential to secure self-sustainability and self-governanceand formulated the “Basic Policy to Improve theGovernance Structure to Secure the Fairness of Business
Practices” in May 2006, and thus have been promoting
stronger corporate governance. Certain basic policies
were amended at the meeting of the board of directorsthat occurred in May, 2015, to reflect a revision of theCompanies Act.

reinforce corporate governance by enhancing the Board’s
supervisory function concerning the execution of duties.
Executive officers appointed by the Board of Directors
comply with the Group management policies decided by
the Board of Directors. They are responsible for executing
their delegated and designated duties and performtheir duties quickly while receiving the supervision of therelated representative directors. The Company has a
Board of Corporate Auditors. The Board of Corporate
Auditors consists of four members, two of whom areoutside corporate auditors. The Board of Corporate
Auditors communicates with directors, the internal auditing
department, and other related departments, while adhering
to auditing policies, the division of duties, and auditing rules
for corporate auditors stipulated by the Board of Corporate
Auditors. The corporate auditors attend Board of Directors
Meetings and other important meetings, and audit theduties of directors by means of monitoring the business
operations and financial conditions of the Group. We havean Internal Auditors Office to assist the Board of Corporate
Auditors, which works under the direct control of the Board.
In addition, we have an Internal Auditing Division,
which directly reports to the president, fulfilling the role ofdiagnosing the Group’s corporate fitness level in a regularmanner. This Internal Auditing Division conducts internal
audits to check the effectiveness and efficiency of business
operations, the reliability of financial reporting, the status ofcompliance with laws and regulations, and the maintenanceof assets covering the Company and all Group companies
at home and abroad. It also reports the results of internal
audits to top management, and offers advice to the related
employees on their performance of business duties.
With respect to requirements regarding the guidanceof the internal control system for financial reporting inaccordance with the Financial Instruments and Exchange
Law in Japan, the Company adopted basic policies that
conform to the Implementation Guidance for Management
Assessment and Audit of Internal Controls over Financial
Reporting (ICFR) by Japan’s Financial Services Agency.
The Internal Auditing Division independently audits theeffectiveness of internal control systems in terms of
implementation status and improvements at the Company
as well as at the overall Group level.

Director and Senior Managing Executive Officer
Masamichi Kuramoto

Corporate Auditors
Senior Corporate Auditor

Kazuyuki Tanaka

Corporate Auditor

Masakiyo Inoue

Senior Corporate Auditor

Toshihiko Ando

Corporate Auditor

Yoshiaki Shin

MEIDENSHA REPORT 2015

26

A Foundation for Building ValueA Foundation for Building Value

Compliance

Risk Management

Meiden Group considers compliance initiatives to be a key part of our practice of CSR. We work to comply with the law,

The entire Meiden Group is stepping up its risk management program, working to prevent various risks and minimize

society’s expectations, and social norms and ethics in general.

impacts if such events occur.

Compliance System at MeidenGroup
Compliance Policy and System

Relations between Company-Wide RMC and existing organizations
Representative(President)

Board of Managing Directors

Instructions

Reporting (accountability)

RMC Office, General Affairs, Legal Affairs

Company-Wide RMCWorks with existing committees to address new problems and issues affecting
more than one committee

MEIDENSHA REPORT 2015

Information exchange meeting

In fiscal 2014, we implemented regulations concerning
information transfer at times when risks arise etc. Further,as part of our efforts towards disaster prevention, we
conducted a simulation of an earthquake occurring directly
beneath Tokyo, which is outlined in the following section.
In fiscal 2015, we will continue to implement andstrengthen our overseas risk management systems.

President
Information Security Committee

Persons responsible in departments

Information Security Office

Person responsible for enacting security measures

MEIDENSHA REPORT 201528

Outline of Meiden Group

Overseas affiliate disaster response offices

Area disaster response offices

27

Meiden Group understands that ensuring the security of
the information assets we handle is a most critical issue.
Thus we protect these assets from disasters, accidents,
criminals, errors, and other threats. We also establish andmaintain information security controls to prevent lapses in
information security caused by leaks, tampering, or theft.
In fiscal 2014, all Meiden Group firms in Japan continued
to implement information security learning programs by
e-learning, and worked on strengthening the prevention ofsensitive information leakage from hardware (PC, laptop,
PC tablet, memory device, etc. ). By doing so, we further
strengthen our information security management.
Information security control system

Priority Initiatives for Fiscal 2014

Meiden has a whistleblower system on compliance. This
is to prevent illegal actions or misconduct and to solve
problems as early as possible if such illegal action or
misconduct occurs.

Strengthen Information Security
Management

A Foundation for Building Value — Compliance / Risk Management

Disaster drill planningworking teamOperation of the Company-Wide RMCConsider response to individual major risks

Whistleblower System on Compliance

Special Feature

4. Decide on company policies on crises that do happen.

Company-Wide Disaster Response OfficeCompliance managers

happen.

New Influenza Strains Emergency Response OfficeCompliance managers

3. Encourage measures to prevent crises before they

Company and area safety and health committees

Compliance Officerisk management, and encourage improvements.

Product and Technology Deliberation Committee

Compliance Office

In Fiscal 2014, we made a simulation analysis of anearthquake centered directly under Tokyo. The purposesof this analysis were to confirm the expected damage tothe major business premises of Meiden Group in the Tokyo
area, and we also performed a simulation of how we could
maintain the head office functions of the Company evenafter such a quake. Based on the results of the simulation
analysis, we will continue to work on the issue of how tomaintain the head office function of the Company.
In fiscal 2015, we will draw up a disaster drill scenario
assuming a quake directly hitting the Tokyo area andfeaturing an earthquake occurring directly below Tokyo,
and will conduct disaster drills including contact exercises
between our Tokyo Head Office and the offices of other key
manufacturing hubs in Japan.

organizations are functioning effectively in terms of

Quality Assurance Council

Compliance Committee

2. Periodically check and evaluate whether relevant

Product Liability Committee

Compliance Committeeorganizational risks

Meiden Group Environmental Committee

Meiden Group Compliance System

1. Establish basic policies on major and cross-

Information Security Committee

Meiden Compliance System

Compliance Committees hold Compliance Information
Exchange Meetings at major business premises inJapan every year. The purpose is to maintain and raisecompliance awareness and receive input from people ineach workplace. The Compliance Information Exchange
Meetings also serve as education for compliance managers
and selected employees, who also have the opportunity to
exchange views with the Compliance Committees. These
events were held at 22 locations in fiscal 2014, inviting a
total of about 1,242, including compliance managers andselected Group employees. The committees reported on
their companies’ compliance activities, including individual
whistleblower cases and how the Company responded.
Training was also given on workplace harassment and the
Act against Delay in Payment of Subcontract Proceeds, Etc.
to Subcontractors. Legal affairs staff gave further training to
inform participants about especially unacceptable behavior,using specific examples. For their part, the participants
talked about their workplace conditions, expressing theiropinions and hopes to the committees and asking plentyof questions. We aim to reflect these participants’ input informulating fiscal 2015 compliance program policies foreven better compliance activities.

Meiden Group has a system in place to oversee risk
management over potential problems in the Group. Our
Company-Wide Risk Management Committee (RMC)
functions as described below to respond to major, crossorganizational crises. The Company-Wide RMC also
partners with working group committees (WGCs) to study
anticipated risks and their level of seriousness and toprioritize responses to them.

Safety and Trade Control Committee

Meiden Group Compliance System

Compliance Education and Information
Exchange Meetings

Implementation of Total Disaster Reduction
DrillsA Stronger Risk Management
SystemCompliance Committee

Meiden Group Code of Conduct (COC) defines that weshall strive to ensure compliance with applicable laws andregulations of our business operations-related matters,other applicable laws and regulations at home and abroad,social and ethical norms, and its underlining spirit, and weshall conduct our businesses with strong corporate ethics
and good corporate social sense.
Given this policy, Meiden and its Group companies
established a compliance committee at each level asper Meiden Group Compliance Promotion Rules. These
committees actively communicate with each other andpromote CSR programs.
The purpose of our Compliance Committee is to decideon policies for compliance programs, arrange complianceawareness campaigns, respond to internal information on
COC violations, and compile the common committee’s
opinions on various events that have occurred and takeaction to resolve the issues. The activities of the Committee
are reported to the representative director (Compliance) andlawyer and we strongly promote our compliance programs
and secure the transparency of those programs.
Each workplace has a compliance manager, who makes
sure that the Committee’s policies are well understood andthe business activities comply with the applicable laws,
regulations and social norms. The compliance manager
also offers consultation to any employee who seeks advice
on some problem and, when necessary, reports to the headof the workplace to offer advice to correct the problem. The
compliance manager reports periodically on these activities
to the Committee.

For this whistleblower system, there are two routes: aninternal hotline system for compliance violations (Internal
Hotline System) and a whistleblower hotline for public
interests (Public Whistleblower System).
For the Internal Hotline System, any employee in Japan
can enter the ‘hot-line site on compliance violations’ on an
anonymous basis. For the Public Whistleblower System, thecontact points by phone are available at internal telephones
and the external third-party phone. The third-party phone
is located at the law firm to protect the whistleblower andto secure fairness in response to compliance violation
information.
The Compliance Committee studies information that isbrought to the above points of contact, and, if necessary,consults with a lawyer for resolution. Those who reportproblems are protected under the Whistleblower ProtectionAct.

A Foundation for Building Value

Research and Development /Capital Investments / Intellectual Property
We are actively engaging in research and development programs, capital investment and intellectual property-related
activities to assist the progress of our “Power of Collaborative Manufacturing Excellence” in preparation for a new leap
forward of Meiden Group.

Research and Development

Lighting

Combined Heat andPower (CHP) System

Smart BEMS

9,680
8,424

Millions of yen

Programs for Intellectual Property(IP) Rights Protection and Use

10,261
9,090

Under Meiden Group Corporate Code of Conduct, we
strive to comply with the laws, regulations and social norms.
Regarding IP rights, we respect the IP rights of other firms
and at the same time, we work on programs to protect andactively use the Group’s IP rights.
2011

2012

2013

2014

FY

Capital Investments
Based on our mission to support social infrastructure, wehave focused on investment in production facilities in orderto improve the competitiveness of our products. In the
Numazu area of Japan, we enhanced our systems toprovide long-term support for social infrastructure facilities
that we have delivered up to this point, and restructured our
CAD system to improve the efficiency of our production
processes. Further, in order to support productcompetitiveness, we updated our A/C generators fortesting transformers, and our sheet-metal working facilities.
Trends in value of capital investments

EnergyStorage
System

8,882

9,249

Millions of yen

8,887

EnergyDemandEnergySupplySolar Power
System

2011

2012

2013

2014

In the Medium-term Management Plan, “V120,” “Beef up
Product Competitiveness” is listed as a basic policy. We,at the Intellectual Property Division, support the R & D
activities and work hard to obtain the results of suchactivities as our original proprietary technologies. In sodoing, we aim to increase the competitiveness of our
products.
Furthermore, we will assist the business units as wellas the corporate management by reducing the risks ofinfringing on other companies’ IP rights.

Organization

Our Intellectual Property Division engages in application,
registry and maintenance of IP rights for the entire Meiden
Group. We also assign Patent Managers to each of ourresearch and engineering-related business units (BUs).
Each Patent Manager co-operates with the Division topromote IP rights strategy to fit each BU's research anddevelopment and its business.

Initiatives in support of Meiden Group Going
Global

6,823

EV Charging
StationBasic Policy for IP Rights

FY

In the Medium-term Management Plan, “V120,” “Beef up
the Profit Base in Japan Operations” and “Grow Overseas”
are listed as basic policies. We promote acquiring andideally utilizing IP rights in support of our overseas businessstrategy. We also proactively avoid IP rights disputes byconducting prevention research programs for any possible
patent infringements. In so doing, we help the Meiden
Group grow overseas.

MEIDENSHA REPORT 201530

Outline of Meiden Group

MEIDENSHA REPORT 2015

Air conditioning

Trends in R&D expenses

In the Ota area of Japan, we renovated and upgraded ourplant buildings to improve the working environment andsafety, as well as product quality. Additionally, as part of ouroverseas investments, following on from fiscal 2013, wehave continued to invest in order receiving, procurement,
and planning systems that support the development of ourbusiness. In the Osaki area of Japan, we are constructing
rental apartments for our real estate business as an effective
use of the site of our old company housing.

A Foundation for Building Value — Research and Development / Capital Investments / Intellectual Property

29“Smart BEMS” Energy Demand and Supply Control Image

demonstration project of the Yokohama Smart City (YSCP)Project, we secured an order for an EMS from the Yokohama
City University Medical Center.
Through the development of these fundamental coretechnologies, we aim to increase the competitiveness of ourcore product line-ups and improve our ICT technologies. In
so doing, we also aim to produce exciting new products andincrease the profitability of our system products business.

Special Feature

We are making R & D investments focusing on developmentof fundamental core technologies to improve the competitive
advantages of our technologies in the areas of “generators,”“transformers,” “switchgears,” “surge arrestors,” and “motor
drive systems,” which comprise the Group’s core productportfolio.
In the field of generators and transformers, we areworking on establishing the “front-loading” method andaim to introduce it to our design work. This method uses
simulation-based analysis technologies to find the mosteffective cooling designand low-noise structure or
to select the most suitable
insulating materials, etc.
In so doing, we will realize
faster market release of
price-competitive products
withhigherefficiency
and compact design. In
145kV V-GIS
the field of switchgear,
we commercialized the
145kV V-GIS, which uses environmentally friendly vacuum
insulation for the first time in the world in 145kV-classmodels and is completely free fromconventional SF6 gas, which is agreenhouse gas. This product uses
our fundamental core technologies
such as new material searching
methods or determining the correct
combination of the composite
materials, etc.
In the field of power conversion,
we developed the world’s mostcompact and highest-efficiency
Transformer-less(98.5%) transformer-less mediummedium-voltage inverter
voltage inverter prototype and weare working hard on the related
development programs for the earliest release to themarket. This technology uses our original methods andwas awarded an Award for Excellence at Japan’s JEMA
Technical Awards. Furthermore, we exhibited our prototype
model at the world’s largest power generation exhibition,“Power-Gen International 2014” in the U.S. and received
many inquiries from the oil and gas industry.
In the field of electricity generation, we commercialized a
new type of converter for small hydroelectric power systems.
The hydroelectric power markets are expected to growat home and abroad. Introducing these converters allows

the user to make variable-speed operation of generators
to match the speed of the turbines, and such operation
enables stable power output. This technology was awarded
an Encouragement Award at the JEMA Technical Awards(see p.17 for related information.)In the industrial field,
we developed a new
motor drive unit for EVs.
Thanks to the integrationof gear and inverter, thismotor drive unit realized
an approximately 30%
reduction of product sizein the axial direction.
Integrated drive unit combining motor
and gearbox
This size reduction
increases vehicle design
freedom for automakers and leads to the overall cost
reduction of the vehicle. This also allows us to promote our
product competitiveness against the competition.
In the field of water and the environment, we received
an order for ceramic flat membrane units for the industrial
wastewater processing plant at the Changi Water
Reclamation Plant run by Singapore’s Public Utility Board(PUB). The processing plant has the world’s largest
processing capacity of industrial wastewater. The order was
granted in recognition of our system engineering capability
for systems combining ceramic membrane technology and
USAB technology through the demonstration plant underoperation at PUB’s Jurong Water Reclamation Plant.
Furthermore, in order to grow next-generation
technologies, we have devoted ourselves to the developmentof a next-generation energy management system (EMS) thatrealizes both stable power supply and a lower environmental
footprint. As an example of the commercialization of
our technological know-how and expertise through theA Foundation for Building Value

Quality and Product Safety
Meiden Group attempts to define the customer’s requirements and our challenges and we aim to make Meiden Grouptrusted and relied upon by our customers and society through the offering of high-quality products and services. We
practice the following Basic Policy.

President’s Quality Management Policy Directive for Fiscal 2013
Offering customers peace of mind and satisfaction
Value “our passion for producing the best products and services” and provide the high-quality products, erection & construction works and various services. We aim to help
our customers in solving their issues and to produce the best product experiences. Implement various QC-related key policy programs to get positive results.

Promote Programs to Collect Customer Needs

Flow of initiatives for finding customer needs

Draft targets
and policies

Individual
responseand daily
initiatives

Individual
response

Evaluation

Concrete action
Prompt response to individual requests

Initiatives for error-proofing program against
3F situations (first time, far from norm, far lessfrequency)
We are working on practicing our design review programswith the presence of experts so that people participatingin the programs are aware of the potential risks. This isa part of the action programs to build the QC system forstudy, verification and management of the 3Fs (first time,
far from norm, far less frequency) as key checkpoints. Thisis designed to train our workers so that they will take preemptive measures by noticing the potential risks using theirknowledge of changing points (moments) likely to cause
errors.”

Improving QC Skills
In order to acquire essential knowledge of QC, we conduct
QC engineering education courses, not only for people
at production-related Bus, but also for people at nonproduction-related BUs. The programs are available inJapan for the following groups of people: new recruits, young
employees, middle management leaders, etc. The courses
cover such topics as “Role of QC,” “How to Proceed with
Kaizen,” “QC 7 Tools,” “5 Whys of Analysis,” “Human Error
Prevention – Poka Yoke,” “Proactive Prevention of Defects
and Prevention of Reoccurrence,” etc. The courses include
Group-based actual case study training. We provide the
QC engineering education courses to people at Meiden
Group firms at home and abroad.

Analysis

Evaluate
Evaluate targets
and link them tonext stage

Responsefrom total
information:
analysis,
investigationof problem

Extraction ofproblem

Evaluation
Organization
into themes

From the information collected, findcommon problems and solve themExamination through 3-dimensional
x-rays and CT scans

Examination of contents after
removal of packaging

Meiden Group focuses R&D programs on strength andtemperature analysis that supports the development of
products featuring eco-friendly, compact, highly efficient,and long-lasting design. For instance, regarding theanti-seismic design of switchgear frames and electricalequipment inside switchgear panels, from the earliest stageof design, we perform aseismic analysis simulation. After
finishing the design, we do a detailed evaluation on a digital
prototype model. In so doing, we realize a highly reliable
product design. We also do thermal fluid analysis simulation
for rotating machinery and panel products to produce
effective cooling design. This realizes compact and longlasting design.

Our programs for more compact design toincrease product competitivenessBy “smart visualization” of physical phenomena using
computer analysis tools, we can correctly determine thephysical phenomena taking place inside our products. In
so doing, we conduct problem-solving support for issues
emerging during the new product development stage.
For example, for the cooling design for large-size rotatingmachinery, we conduct analysis of heat transfer throughheat generation and conduction and perform fluid analysis
of cooling air, and as a result, we determine the mostefficient air-ventilation design. Through these programs,
we realize compact design and reduced cost.

Improve Product Performance and Promote‘Front-Loading’ by Computer Analysis
The Analysis Center practices ‘front-loading,’ which iscomputer-based validation of design by analysis simulationfrom the earliest stage, thereby determining the effective
design. Such practice realizes improvement of productquality, shorter development time by reducing development

Coil
Rotor

StatorCoilHeat analysis of rotary machine

TOPICS
Maintenance Engineering Training Courses for safety andsystem reliability
At Meiden Engineering Center located next to Meiden Numazu Works, Numazu City, Japan,
we provide technical skill training and engineering education courses for training maintenanceengineers. Through training using actual power equipment that is very close to on-the-job
training, we are cultivating maintenance engineers who can contribute to reliable, safe andeffective operation of the customer’s facilities.
Training courses are taught by veteran maintenance engineers with rich and varied on-siteexperience. The curriculum covers nearly all Meiden power products, including high-voltage
substations, industrial PC facilities, power conversion products, power generation equipment,
induction motors, etc. The courses are designed to obtain the required knowledge throughhands-on experience. Trainees learn about the internal structure of equipment by using crosssection models. They perform actual operation training by operating disconnect switches, andcircuit breakers, power generation systems and inverters, and by conducting protective relay test,
etc. Teaching materials include the latest systems such as photovoltaic power systems.

Outline of Meiden Group

Plan targets andpolicies basedon departmental
strategy

Determining needs

Initiatives for Improving Quality

The Analysis Center evaluates product reliability, prevents
defects, and provides diagnosis of deteriorated product life.
These Center activities are based on the Three Pillars of its
policy: “Improve product quality,” “Produce new products”
and “Think Eco.”
For new parts and components, we evaluate thecompliance with our internal benchmarking standards byconducting: (1) observation by non-destructive inspection;(2) observation of the internal parts by removing the
package; and (3) observation of the internal structure
through cross-sectional views, etc.
We are working hard on reliability evaluation andare improving our system to check defects of electronic
components.

Programs to Realize Eco-Friendly, Strong,
Compact, and Long-Lasting Products

Maintenance technology
training

Training technical staff
overseas

Scene from a training session

31

MEIDENSHA REPORT 2015

A Foundation for Building Value — Quality and Product Safety

In order to provide the products and services for thebest product experiences of our customers, Meiden
Group listens, collects and analyzes the actual feedback/comments from our customers (information from ourcustomers, requirement information, unsatisfactory points)
as well as the market trends, etc. as “Customer Needs,”
and we link these inputs with our other programs/activities
such as solutions proposals, new product developments,
services, and various kaizen programs.
Each of the BUs having contact with customers suchas R&D, sales and marketing, engineering, production, andproject site construction will make an operational review at
each BU level, define the evaluation items and summarize
the plan for the next half-fiscal year. Each BU gives selfevaluation on operational results and by applying the PDCA
(Plan-Do-Check-Action) Cycle and aiming to improve theoperational performance level.

❷ Recognize the social responsibility and importance of our products, erection &construction works and various services. Each employee shall be aware that poor
quality of our offerings will greatly damage our corporate management and that weshall perform QC-related actions properly. Improve and build the quality gate for zero
defects.

Promoting “Front-Loading” Methods to Prevent
Defects

rework, and improvement of product performance andsafety.

Special Feature

Basic Policy❶ A s a customer problem-solving partner, all employees should actively listen to input
from our customers, act quickly and produce the best product experiences.

Environmentally Conscious ProductDevelopment by Improving ProductQuality, Life-span, and Energy Efficiency

MEIDENSHA REPORT 201532

A Foundation for Building Value

Protection of the Environment❸ We strive to promote environmentally conscious business processes with green
initiatives: promoting energy saving, promoting the 3Rs (reduce, reuse and recycle)
and reducing the release of hazardous materials to reduce the environmental impact
from our business activities.
❹ While complying with all environmental laws, regulations and other requirements, wewill establish our own internal standards and work hard to prevent pollution from ourbusiness activities.

*Note: The Plan-Do-Check-Act Cycle means: Plan: Identifying and analyzing the problem. Do:
Developing and testing a potential solution. Check: Measuring how effective the test solution
was, and analyzing whether it could be improved in any way. Act: Implementing the improved
solution fully.

❻ W e strive to implement initiatives including environmental education and PR
activities in order to increase all of our employees’ understanding of environmental
management and make our environmental programs more proactive.
❼ We will broadly promote communication with our stakeholders by disclosing internallyand externally the environmental impacts from our business activities and programsin order to reduce such impacts.
Second revised edition dated June 30, 2013
Yuji Hamasaki, President, Meidensha Corporation○Achieved △Not achieved (better than previous year) ×Not achieved (not as good as previous year)

Mitigating Climate Change
Realize a recycling society

What we can dofor Planet EarthConserving biodiversity

Meiden Group Environmental Vision
A.Mitigating Climate Change

B.Conserving Resources(Building a Recycling Society)

C.Conserving biodiversity

D.Foster a corporate culture thathighly values the environment

Meiden Group Environmental Vision
A Corporate Culture that Highly Values the Environment

Targets that express our Environmental Vision
Vision(Fiscal 2020)

Deployment of Action Plans

Develop to
Action Plans

Corresponding“Environmental Vision”● Expand products and businesses
1. Expandthat contribute to the environment
products’contribution to ● Strengthen management of
the environment chemicals in products

3. Promote
environmental
management●

Reduce greenhouse gas emissions●

Promote reduction of waste discharge
by 3Rs (Reduce, Reuse and Recycle)●

Eliminate hazardous chemical
substances in products

B. Realize a recycling society●

Promote environmental communication

C. Conserve biodiversity●

Promote value chain management●

Promote maintenance of
biodiversity and managementof green zones

4. Improve employees’● Improve environmental education
environmental
awareness

33

A. Mitigating Climate Change

MEIDENSHA REPORT 2015

D.Foster a corporate culture thathighly values the environment

Evaluation

Contribute 400,000 t/year CO2 emission reduction effects by
ECBs

Contribute 590,000 t/year CO2 emission reduction
effects by ECBs○

1) Promote environmentally conscious design

Expansion of scope of subjects for environmentally-conscious
designExpansion of environmentally-conscious design of
newly developed products○

2) Promote green procurement

Achieve green procurement through its green quality supplierapproval program – more than 50 certified suppliers per year

Achieve green procurement through its green quality
supplier approval program – more than 51 certified
suppliers per year○

1) Reduce CO2 emissions from businessactivities*1

Reduce 1% in CO2 emissions per unit of energy (against
previous fiscal year)

Reduced 9.9% in CO2 emissions per unit of energy○

2) Promote initiatives to eliminate hazardous
chemical substances in products

Reduce 48% in volatile organic compounds (VOC)
Reduce 30% in volatile organic compounds (VOC) released fromreleased from burning fuels (against the level ofburning fuels (Maintained) (against the level of fiscal 2000)
fiscal 2000)○

3) Promote reduction of waste discharge by
3Rs (Reduce, Reuse and Recycle)

Achieve “zero emissions”*2 (major production hubs in Japan*3,
engineering service business units (BUs) and construction service
business units (BUs))○

1) Protection of biodiversity

Organization of activities in cooperation with regional community Conducted environmental conservation activities etc.
(Main four locations*4)
at our 4 main locations

II. Develop environmentally conscious
products (ECPs)

III. Promote environmentally conscious
business processes

IV. Promotion of environmental
communication

Strategic Targets
1. Expand products’ contribution to theenvironment

Actions
Expand products and businesses that contributeto the environment○

2. Reduce the environmental impact ofbusiness activities

3. Promote environmental management

V120 Targets (Fiscal 2017 Targets)
Contribute 800 thousand t/year reduction in CO2 emissions by ECBs

Fiscal 2015 Targets
Contribute 620 thousand t/year reduction in CO2 emissions by ECBs

Conduct LCA assessments in each product category

Conduct LCA assessments for new products

Reduce energy consumption per unit of production by 3% from 2014
levels*1

Reduce energy consumption per unit of production by 1% from2014 levels

Reduce SF6 output amount to less than 3% of purchased amount(against the level of fiscal 2014)

Reduce SF6 output amount to less than 3% of purchased amount(Major production hubs in Japan*3, engineering service business units(BUs) and construction service business units (BUs))(Major production hubs in Japan, engineering service business units(BUs) and construction service business units (BUs))

Reduce waste emissions per unit of production*5 by 8% (against thelevel of fiscal 2014)

Reduce waste emissions per unit of production by 2% (against thelevel of fiscal 2014)

Eliminate hazardous chemical substances in
products

Reduce VOC emissions by 30% (against the level of fiscal 2000)

Reduce VOC emissions by 30% (against the level of fiscal 2000)

Promote value chain management

Support supplier EMS systems (50 companies)

Support supplier EMS systems (20 companies)

Promote maintenance of biodiversity andmanagement of green zones

Utilize green zones by factories in a manner that is considerate ofbiodiversity<Main four locations>*4

Manage green zones by factories in a manner that is considerateof biodiversity<Main four locations>

Reduce greenhouse gas emissions

D. Foster a corporate culture that highly values the environment❶ Promote environmental communication: Actively disclose ourenvironmental activities and results and promote two-way
communication with our stakeholders.
❷ Foster environmental awareness: For mitigating Climate Change,
increase environmental literacy to promote environmentally conscious
R&D and product development and cultivate the Group’s individuals
who actively perform local community and social contribution programsby acting on their own initiative.

Achieved zero emissions at all applicable locations

Meiden Group Fiscal 2015 Targets and V120 Medium-term Targets (in Japan)

C. Conserving biodiversity❶ Contribute to securing water resources through our water processing
systems business.
❷ Conduct risk management on chemical materials and promote thereduction of very risky hazardous chemical materials, as well as
initiatives to find alternative materials on a basis to reduce or replace
harmful chemicals.

Environmental initiatives

Promote reduction of waste discharge by 3Rs(Reduce, Reuse and Recycle)*1 Target: “Reduction of CO2 emissions from business activities”: Activities in line with levels proposed in “the Action Plan Towards a Low-carbon Society” by the Japanese Electrical Industry*2 Meiden Group definition of zero emissions: To achieve efficient use of resource rate in a range that is less than 1.0% of the total volume of waste (including industrial waste, general waste, and saleable waste, but excluding construction sludge, etc.) is not recycled.
*3 Major production hubs: Meiden Numazu Works, Meiden Ohta Works, Meiden Nagoya Works, Kofu Meidensha Electric, Meiden Chemical (Sagami Works), Hokuto Denko (Atsugi Works)*4 Main four locations: Meiden Numazu Works, Meiden Ohta Works, Meiden Nagoya Works, and Kofu Meidensha*5 Waste emissions per unit of production (t/million yen) is the amount of waste produced (t) for a given amount of production yield (million yen)

MEIDENSHA REPORT 201534

Outline of Meiden Group

2. Reduce theenvironmental
impact ofbusiness
activities❶ Contribute to the reduction of CO2 emissions through the sale ofenergy-related products and systems (i.e., products for renewableenergy resources, etc.)❷ Promote environmentally conscious product design and reduce CO2
emissions in the product life cycle.
❸ Reduce CO2 emissions in our production activities.
❶ Promote the 3Rs (Reduce, Reuse and Recycle) of waste materials in thevarious stages of the product life cycle.
❷ Promote zero emissions of waste products from our production
activities.

Action Plan (Fiscal 2015 – Fiscal 2017)

Actions

Strategic Targets

Fiscal 2014 results

A. Mitigating Climate Change

B. Conserving Resources (Building a Recycling Society)

V120 Plan

POWER 5 Targets (Fiscal 2014 targets)

I. Promote businesses that contribute to theIncrease the contribution to the environment
environment (“Eco-contributing Businesses”
via products(ECBs))A Foundation for Building Value — Protection of the Environment

As a medium-term guideline to assist us in advancing environmental management, the Meiden Group has formulated an Environmental Vision that indicates the stance that we should adopt andthe appropriate direction for our environmental activities. We seek to contribute to the realization of a sustainable society by means of the reduction of the environmental impact resulting from ourbusiness activities and the deployment of the businesses, products and technologies that we have developed to date in the fields of energy and water treatment to support social infrastructure. Our
Environmental Vision identifies the mitigation of climate change, the building of a recycling society, and the conservation of biodiversity as the missions of a 21st century company, and establishes
targets for how we should perform in our business activities and what we should aim for in our products. We work to implement environmental management with a corporate culture that highly
values the environment as the foundation that helps us to achieve these targets.

EMS Measuresand Promotion WG

Meiden Group Fiscal 2014 Environmental Targets / Status of Achievement of Targets (in Japan)

Basic measure

Environmental Vision

Administrative Office (EMPAD)

Meiden Group companies❷ We strive to design and develop green products by conducting environmental impact
evaluation for the product’s life cycle, from initial material procurement to final
disposal.

❺ After establishing an environmental management system, we strive to maintain andimprove it through the QC tool of the PDCA (Plan-Do-Check-Act) Cycle.*

GM in charge of EMS(GM of EMPAD)

Special Feature❶ For the environment, we will promote the development of new environmentallyconscious products and innovations in eco-friendly technologies. We will provide
such products for broader world markets. In so doing, we will positively contribute to
mitigating climate change, creating a recycling society and maintaining biodiversity.

Meiden Group Environmental Committee
Chairman: Executive Officer(Environment)

All Meiden Environmental
Internal Audit GroupInternational Business Planning& Management Division

The Meiden Group’s Environmental Action Guidelines

President (CEO of EMS)
Executive Officer (Environment)（Executive Duties of EMS）

Plant Construction &Engineering Business Division

With our basic environmental philosophy of “contribute to people, society, and the global environment,” the Meiden Group aims to develop our business, while tackling theimportant environmental management issues involved in creating a sustainable society, mitigating climate change, fostering a recycling-oriented society and maintaining
biodiversity.

Meiden Group EMS Promotion Organization

Research andDevelopment Department

The Meiden Group Basic Environmental Philosophy

Meiden Group promotes an environmental management system (EMS) at
each level and at the Group-wide level. In our EMS organization, the chief
executive officer is our President and the officer carrying out EMS executive
duties is our executive officer (environment) who oversees the overall EMS
management of the entire Meiden Group.
The general manager (GM) in charge of EMS is the General Managerof the Environmental Management Program Administration Division(EMPAD). The GM maintains and improves EMS of the Meiden Group. The
GM organizes the All-Meiden Environmental Internal Audit Group (AMEIAGroup) as an independent organization and the AMEIA Group inspects andmonitors the status of the EMS program, conditions of compliance withrelated laws and regulations and makes proposals for EMS improvements.
Our executive officer (environment) is the chairman of the Meiden
Group Environmental Committee (MGEC), which is our EMS Organization’s
highest decision-making body in relation to environmental activities. The
MGEC sets environmental targets and formulates action plans, conducts

Branch Offices and Branches

Basic Environmental Philosophy

Head Office

Our Programs for Environmental Management

Meiden Nagoya Works

our core business.

management reviews, responds to emergency situations and reviews andreports on the activities of environmental measures and working groups(WGs) and EMS promotion WGs. The MGEC decides the policy directionsof our EMS.

Meiden Ohta Works

management that contributes to the protection of the global environment and the realization of an affluent society throughPromoting Strategic Environmental Management

Meiden Numazu Works

Under our Basic Environmental Philosophy, every individual employee of Meiden Group promotes environmental

Promoting Business thatContributes to the Environment(“Eco-contributing Businesses” (ECBs))

Contribute to mitigating Climate Change
through the CO2 reductions achieved by ECBs

CO2 emission reduction(10,000t-CO2)

CO2 emission reduction target – 400,000 t/year

A Meiden Green Product* newly certified infiscal 2014

Reducing CO2 Emissions from Our Business
Activities

4-Pole Turbine Generator with Solid Salient
Pole Rotor

The majority of Meiden Group’s greenhouse gas emissions
occur through energy consumption for our businessactivities. We aim to streamline our power consumption,
including that for production processes, by such measures
as energy-saving of lighting inside the factories, renovationof air-conditioning systems, energy-efficient operation ofexisting facilities, and reviewing of our energy management.
Further, the entire Meiden Group has reduced energy
consumption by the equivalent of about 260kl of crude oil (equal
to 1.3%) through the grass roots-level activities of our energysaving study circles in Japan. We were thereby able to reduce
CO2 emissions by 440t. In addition, due to favorable production,
we were able to reduce energy consumption per unit of production
by 9.9% in fiscal 2014, in spite of our target being only 1%.
Due to the robust production, we were able to improve theenergy consumption per unit at the rate of 9.9% gain from theprevious year despite our target of 1% gain from the previous year.

Turbine generators are synchronous generators for turbine
drive powered by steam or combustion gas.
In fiscal 2014, we developed the 4-pole turbine generator withsalient solid pole rotor. This generator has a 10-60MVA capacity
and we changed the rotor design from the conventional cylindricalto a salient pole. This change reduced loss and greatly improved
efficiency from the conventional design model. Due to the simple
construction, we were able to realize the compact design, resulting
in total weight reduction of the generator.
Compared with our conventionally designed model withcylindrical rotor, it has the following environmentally conscious
design considerations.

Reduction of product weight
By adopting salient pole rotor design and using the latest
structural analysis, we were able to reduce the generator’smass by approximately 30%.

2009
result2010
result2011
result2012
result2013
result2014
resultFY* The results figure for each fiscal year shows the aggregated figure of the annual CO2 emissions
reduction effect from products shipped since fiscal 2009

Conservation of energy and resources
By adopting salient pole rotor design, generating efficiency
improved from 97.6%
to 98.3%.
* Typical value for 48.75MVA(11kV, 50Hz) unit

Trends in CO2 emissions (Domestic)
Automobile fuel2010

Outlander PHEV

35

Wajima Community Wind Farm

MEIDENSHA REPORT 2015

New AC-DC Conversion Power Conditioning
Subsystem (PCS) for NAS Battery
We installed a new type of PCS for the NAS battery for “Kashiwa-no-ha Smart
City Project” in Kashiwa City, Chiba Prefecture. This PCS system allows
power-interchange of distributed
energy resources so the power canbe used among the different-purpose
facilities located in the various city
blocks. On a wider area level, thesystem is able to realize both peaksharing of power and reinforcementof disaster prevention capability at
A panoramic view of the project site
the regional level.

39,792

42,3191,813

41,879

1,910

1,857

40,40937,97937,430

2011

2012

2013

40,0222014

FY* Until fiscal 2013, average annual figures published by The Federation of Electric Power Companies of Japan havebeen used for the emissions factor (receiving end). The average annual figure for fiscal 2013 published by The
Federation of Electric Power Companies of Japan has been used for the fiscal 2014 emissions factor.

Energy consumption and rate of improvement in energy
consumption per unit of production (Domestic)
Rate of reduction ofenergy consumption

Fiscal 2013energy consumption

Fiscal 2014
energy consumption

1.3%

19,239kℓ

18,980kℓ

Rate of improvement in energy
consumption per unit of production
due to increased efficiency inproduction processes

9.9%

Overview of Environmental Impacts by Our Business Activities (Fiscal 2014)
At Meiden Group, we monitor the environmental impacts from our business activities. Our rate of use of major resources andour environmental impacts from our business activities are shown below.

OUTPUT

INPUT
Item

Japan

Overseas

Item

Electricity

53,968

10,994

MWh

Fuel oil

1,210

469

kℓ

Fuel gas

3,450

89

1,000m3

Heat

3,598

–

GJ

Tap water

57

37

1,000mIndustrial water94

171,000m3

1,239–

1,000m3

Groundwater

OverseasJapan

Release to Air

EnergyCO2 (enegy)*1

40,022

7,686

t-CO2

CO2 (automobile fuel)

1,857

729

t-CO2

77

–

t

VOCs
SF6

299

236

kg

SOX

0.3

–

t

NOX

7.8

–

t

Wastewater

1,495

54

1,000m3

BOD*

5,201

–

kg

Release into public water area

3

2

Wastes from our business activities(excluding sludge from construction)

Chemical substances
VOCs

445

–

t

Products

Amount not recycled

35

300

t

Amount recycled

8,047

1,516

t

69

–

t

Product weight

50,243–t

CO2 release by transportation

2,010

–

t-CO2

Construction sludge

Greenhouse gases
SF6

Transportation
17,9504,591

kg

Transportation*1 Average figures for the period from 2010 to 2012 published in the International Energy Agency (IEA)’s CO2 Emissions from Fuel Combustion (2014 Edition) were used for the emission coefficient for power use for each country. For fuel oil and fuelgas, emission coefficients for each country published by the Greenhouse Gas Protocol Initiative were used.
*2 Calculated as a measure of impact based on oxygen concentration and wastewater volume.

MEIDENSHA REPORT 201536

Outline of Meiden Group

Mega Solar Shimizu (Shizuoka Prefecture)

4 pole turbine generator with salient solid pole rotor

1,834

1,593
31,500

Water

TOPICS

Energy usage

39,26433,093（t-CO2）

A Foundation for Building Value — Protection of the Environment

590,000 t/year reduction
in CO2 emissions

Environmental Initiatives related toBusiness Activities

Special Feature

We identified the related businesses of three business fields (solar
power, wind power and electrical components for electric vehicles(EV)) as ECBs with high levels of contribution and enlisted the resulting
contribution of CO2 emission effects through the related products asenvironmental contribution volume and thereby set the eco-efficiency
targets (for fiscal 2014, reduction of 400,000 t-CO2).
In fiscal 2014, we steadily expanded our photovoltaic
generation-related business, resulting in an emissions reductionof 590,000 t-CO2, a figure that greatly exceeded our target.

Environmentally Conscious Product(ECP) Development

A Foundation for Building Value

Human Resources Management
Meiden Group aims to maintain a fair and just employment system and a positive workplace to enable each employee torealize his or her potential.

Building a Positive Workplace with
Job Satisfaction
Personnel Treatment System

Promote Fair and Just Employment Practices
and Respect Diversity in the Workplace

Human Resource Development

Employment Policy

From April 2013, the mandatory hiring level of people withdisabilities was increased by the Japanese Labor Law
to 2.0%. We have been hiring such individuals not only
through our designated subsidiary company but also at
the principal company – Meiden. In Japan, we amended
our re-employment system initially applicable to those who
reach the mandatory retirement age of 60 as of April 2013.
We offer job openings to all applicable and re-employmentseeking people by displaying the job descriptions andentering re-employment contracts.
Rate of employment of people with disabilities (Meiden Group)
2011/6

2012/6

2013/6

2014/6

2015/6

2.09%

2.12%

2.13%

2.18%

2.19%

Legally required employment percentage: 1.8% through March 2013; 2.0% from April 2013

Promoting Diversity

Female employees ina session to talk about
working styles

MEIDENSHA REPORT 2015

Various Training Programs
We provide various training programs for the personal
development of our employees as members of society, as
Meiden Group employees and as professionals. In fiscal
2014, we conducted training programs for overseas Meiden
Group managers and engineers with the training courses
given in Japanese, English and Chinese.
We also invite overseas Meiden Group engineers(production-related) toJapan, where they join
the training programs
at their firms’ related
mother factories. We
will continue to reinforce
theseeducational
programs for globally
Training programs for overseas Meiden
oriented talent.

Major initiatives
MBO Performance Measuring System
In order to ensure high evaluation transparency, we use the MBO (management by
objectives) performance measuring system. This enables each employee to evaluate
their individual performance results in the light of each BU’s performance objectives
under POWER 5. This is in line with each BU’s MAP* activities.
* We named our management policy-related activities at Meiden Group “MAP
Programs.”
MAP: Meiden Advantage Program

Self-reporting system
The self-reporting system helps employees develop personally and form careerplans.

Meister program
The Meister program gives special benefits to employees who contribute to Meiden
Group through excellent craftsmanship. We treat them as high-level experts. So far,
we have certified nine employees as Meisters between fiscal 2008 and fiscal 2014.
(One person was so honored in fiscal 2014.)

Job rotation program
We have adopted a job rotation program to develop the abilities of our young employees.

Occupational Safety and Health(OSH) Management Initiatives

Group engineers

Main Training Programs❶ New-recruit training to help them get a smooth start as a working member ofsociety and subsequent followup training after one year
❷ Newly promoted-employee training to enable them to have the necessary
knowledge and way of thinking for their new job performance* We are reinforcing the training for younger cluster employees; in particular, young employees withthird and fourth year company experience after joining.
We added the training for such company age groups. For newly promoted assistant managers,
assistant senior engineers and senior managers, we have training programs for immediately
following their appointment as well as follow-up training. These training series will help them toacquire practical knowledge.

❸ Subjectively based and participative training program in the form of collective
training or by correspondence course. This program is for career developmentof each employee to enable him or her to acquire the necessary knowledge orskills for the career goal set by themselves.
❹ Life-planning and career-design training program to help senior employees
prepare for their retirement or post-company life-plan in Japan. This training will
enable them to acquire the life-planning skills including budgeting.

First aid workshop

Safety and Health Initiatives Based on
President’s Safety and Health Management
PolicyEach fiscal year, Meiden Group draws up a President’s Safety
and Health Management Policy and undertakes safety andhealth initiatives in keeping with the policy. We also draw up
English- and Chinese-language versions of the same policy.
In so doing, we apply the related initiatives to overseas
Meiden Group companies.

Stop-smoking Session

New Safety and Health System
We view as vital to have daily and continuous OSH activities
at each workplace to enable us to improve and upgrade
our OSH management. In this connection, in fiscal 2014,
we newly established a BU called “Operational Health and
Safety Management Department.” This new BU promotes
overall Meiden Group OSH-related programs. It focuses on
its activities by visiting project sites and teaching and advisingon OSH matters.
Health management matters are addressed at “HealthManagement Liaison Meetings (HMLMs),” which compriseeach major manufacturing hub’s personnel department
and Health Care Office at the Meiden Head Office. The
HMLMs discuss various OSH issues and take appropriate
measures.
Going forward, we will continue to implement andexpand various programs for the safety and fitness of ouremployees.

Outline of Meiden Group

Since fiscal 2014, Meiden Group has implemented diversity
promotion programs. Through such efforts, we aim to
produce new value by making the best use of the uniquedifferences and individual talents of each employee.
Going forward, we will position diversity promotion
as one of our key management policies and will provide
opportunities foreach employee toprove and show
their individuality.
To this end, we will
foster a positive①We will develop human resources capable of contributing
to the management philosophy and to securing thenecessary profit for such objectives.
②We will provide advice and support to each person sothat he or she can find their unique potential and canhave career development to maximize their current andfuture job performance.

TOPICS
More OHAS 18001 Certifications Planned to Follow Acquisition at Numazu Works in Fiscal 2013
After obtaining OHSAS 18001 certification for our occupational health and safety management system at Meiden Numazu Works in fiscal 2013, we initiatedprograms to obtain certification at Meiden Ohta Works (Rotating Machinery Factory), Meiden Nagoya Works and Kofu Meidensha Electric Mfg. Co., Ltd.

❺ J ob-based training programs to foster professional people in each job
description such as engineers, technicians, sales and marketing people.

They all plan to obtain certification during fiscal 2015.

❻ Basic engineering course for back-office staff to know our products. This is tostrengthen the basic knowledge necessary for a supplier’s employee.

new ISO 450001 OSH Management System Standard (an international OSH management system standard), which will come into force in fiscal 2016.

Meiden Group aims to obtain full OHSAS 18001 certification at our major manufacturing hubs in Japan, thereby leading to swift migration to the

MEIDENSHA REPORT 2015

A Foundation for Building Value — Human Resources Management

Hiring of People with Disabilities andAmendment in Our Re-Employment System

Human Resource Development Policy

Special Feature

We are working on providing fair opportunities to enablea diverse range of employees to prove and demonstrate
their potential, free from obstacles based on age, gender,
nationality, etc. We are working hard to build a positiveenvironment that provides the opportunities for each
employee to prove and show their unique individuality
through action programs such as diversity education
programs at all levels, a personnel treatment system forcareer development and review of personnel evaluation, as
well as holding opinion-exchange working group meetingsby female workers in Japan, etc.

37

corporate culture and conduct reviews of various personnel
systems.

Since April 2015, we have revised our personnel treatment
system for general staff members in Japan in order toinspire our employees to contribute to the Company andincrease their motivation to work. This system aims to reward
employees who have made higher contributions or worked
harder according to their actual contributions through ourmulti-track job qualification systems by balancing the “jobrole” and “job contribution.” This system additionally aims tomeet various working styles and also allows those working
styles in the preferred working area (no transfers to locations
far from one’s family).

Recognizing that the occupational safety and health(OSH) of each employee are fundamental to the Group’s
operations, we work to eliminate occupational accidents
and maintain and improve each employee’s health at work.
This follows our Basic Policy: “To secure a safe and positive
work environment and help in realizing the work-life balanceand better lives of our employees.”38

A Foundation for Building ValueA Foundation for Building Value

Supply Chain Management

Social Contribution Programs

The Meiden Group’s CSR initiatives and Code of Conduct are based on our Corporate Philosophy, and we ask our

By contributing to the community as based on Meiden Group Social Contribution Policies, we work to maintain good

suppliers to practice CSR in every aspect of their business activities to the same degree as we do in our own.

communication with the community and other stakeholders.

Meiden Group Basic Procurement Policy

Our Response to Conflict Minerals Issue

Basic Procurement Policy

Promote CSR Programs that
Include the Supply Chain

Promote Green Procurement Activities
Green Procurement

Meiden Group asks our suppliers to understand and cooperate with our response to conflict minerals as part ofensuring socially responsible procurement.

Communication with Our Suppliers

Examples of social contributions (FY2014)
Teaching Children the Fun of Crafting
ThingsKofu Meidensha received a Certificate of Appreciation from the
Minister of Health, Labour and Welfare (MHLW) for Blood Donations

Since fiscal 2007, the 110th anniversary of our founding,we have conducted “Meiden Handicraft Sessions” at Hosui
Elementary School and other elementary schools in communities in Japan where we have our manufacturing hubs.
As of fiscal 2014, we have provided hands-on experiencein the fun out of making things to more than 7,000 children.

This certificate was given to Kofu Meidensha, our Groupfirm in Yamanashi Prefecture, in recognition of its longterm active support for blood donation and public relation
activities for MHLW’s blood donation programs, etc. Kofu
Meidensha has conducted blood donations twice a year
since 1981 and about 33% of employees participate. Kofu
Meidensha first received
such a certificate ofappreciation from thegovernor of Yamanashi
Prefecture in 2000.
As a second similarrecognition, this time
the certificate is from Certificate of appreciation from the
Minister of Health, Labour and Welfare
MHLW.

Production Plan Briefings for Our Suppliers
Twice a year (April & October), our major works in Nagoya,Numazu and Ohta City, our production hubs in Japan, invite
major suppliers for a briefing session to outline the businessenvironment and plan at Meiden and each related BU.
During these briefing sessions, we present excellent supplierawards to those who have greatly assisted us in materials
procurement. This selection comprises several candidates
and the award represents our special appreciation.
Also, we use Web-EDI to streamline the ordering,delivery period response, and the post-delivery paper
exchange work. In so doing, we promote paperlesstransaction using electronic information.

Promote Group Procurement
Organization
We are working to build a stronger procurement organization
throughout Meiden Group. We conduct periodic Meiden
Group Procurement Meetings and refine the programs to
improve the Group’s common procurement platform.

Programs to improve the procurement platform◦Strictly comply with rules and regulations.
◦Strictly implement CSR procurement◦Strengthen risk management (BCP and internal controls)◦Strengthen HR development

Children have fun assembling a motorized ball-type “Scroller” andlearning how to move it around.

Meiden Group Sponsors Azul Claro
Numazu Soccer Team
Meiden is an official sponsor of the JFL soccer team, Azul
Claro Numazu, which is based in Numazu City. Azul Claro
Numazu is a community-based club team that was created through a program to teach soccer to local children.
Meiden has a long history with Numazu City as our production hub and a close relationship with the community there.
Azul Claro Numazu values its community, and Meiden endorses the team’s
goal: “Contributeto a happy andprosperous community-building.”
We support thesuccess of theteam as bothsponsor and fan.

Nature Observation Events in Osaki, Tokyo“ThinkPark Forest,” a zone in our head office premises in Osaki, Tokyo, offersa greenery space integrated with the greenery of other firms located in theneighborhood. Since fiscal 2012, we have held early-morning nature observation
events together with the employees of neighborhood firms. With the help of the
Nature Conservation Society of Japan and through observation and recording of
the four seasons, we came to the realization that there is a variety of creatures inOsaki’s urban green space. In fiscal 2014, we further expanded the activities byconducting “Evening Nature Observation Meetings” after working hours.
Furthermore, we are conducting other programs such as fixed-point
observations where participants observe the trees of “ThinkPark Forest” in every
season, installation of watering places for wild birds, and creation of a leaflet
about Osaki’s green space. Going forward, we hope to utilize the findings ofthese nature observation eventsand to make such events moreproactive by involving more
people in the local community.
Our activities at “ThinkPark
Forest” have been registered as acivil society program for the “Nijumaru Project” to achieve the UN’s
Aichi Biodiversity Targets.
A leaflet titled “Osaki’s Forest”

39

MEIDENSHA REPORT 2015

MEIDENSHA REPORT 201540

Outline of Meiden Group

Based on our Basic Environmental Philosophy: “Contributeto people, society and the global environment,” we are
implementing many programs in line with the Meiden
Group’s Environmental Action Guidelines. Regarding thematerial procurement and product development, we strive
to produce environmentally conscious products (ECPs)
throughout their entire lifecycle, from material procurement
to final disposal. In doing so, through energy- and materialsaving, reduction of hazardous material use, etc., we areworking hard to mitigate climate change.
We consider green sourcing as a part of our supply
chain CSR activities. Since fiscal 2014, we have issued
the “Green Procurement Guidelines” as our environmental
guiding principles in our supply chain activities. By issuing
CSR survey sheets (environmental activities survey sheets)
to our suppliers, we are able to understand their programsfor CSR and environmental protection activities. In thismanner, they help us in our CSR procurement activities
including our green sourcing.

Meiden Group works to prohibit the use of conflict minerals – theminerals tantalum, tin, gold, and tungsten mined in the Democratic
Republic of the Congo and surrounding nations when those minerals
are used to help fund armed forces that repeatedly engage in humantrafficking, forced labor, child labor, abuse, or other inhumane acts.

A Foundation for Building Value — Supply Chain Management / Social Contribution Programs

Meiden Group practices CSR to maintain fair trade thatallows for mutual growth. This includes our procurementof materials. We drafted a “Meiden Group Supply Chain
CSR Deployment Guidebook” based on CSR initiatives that
the Group practices throughout its business. We present
the guidebook to suppliers along with a request that theyand their own suppliers practice similar CSR initiatives.
Guidebook content conforms to the Supply Chain CSR
Deployment Guidebook (August 2006 Edition) of theJapan Electronics and Information Technology Industries
Association (JEITA).

Meiden Group policy on disputed minerals Issue

Special Feature❶ Compliance with applicable laws and social norms❷ F air trade based on free competition❸ Consideration for the environment❹ Building healthy partnerships

In 1918, Mrs. Take Shigemune, the second President of the Company and wife of our founder, Mr. Hosui Shigemune, used her
own funds to establish Hosui Elementary School in Osaki (Shinagawa City, Tokyo), an area where the Company had a factory.
Following in her footsteps, Meiden Group makes a wide variety of social contributions through our active involvement with local
communities and with society.

Outline of Meiden Group

Corporate Data as of March 31, 2015

Area CodeCorporate NameMEIDENSHA CORPORATION

Capital¥17,070 million

Established

June 1, 1917
(Since December 22, 1897)

Consolidated Sales¥230,299 million

Consolidated Number of Employees

8,173

Representative
Director, President

Yuji Hamasaki

Consolidated Subsidiaries

39 (21 in Japan, 18 overseas)

Head Office

ThinkPark Tower, 2-1-1, Osaki,
Shinagawa-ku, Tokyo, 141-6029 Japan

Company Name

CapitalBusiness Entity

Singapore

MEIDEN SINGAPORE PTE. LTD. Note 3

S$25.4 million

Manufacture and sale of transformers, switchboards, andcircuit breakers, maintenance and after-sale service ofelectrical equipment, electrical engineering and import/export
operations, and overseas procurement

Singapore

MEIDEN ASIA PTE. LTD.

S$5 thousand

South-East Asian controlling company

Thai

THAI MEIDENSHA CO., LTD.

TB30.0 million

Electrical engineering, technical consulting, after-sale service,
and import/export operations

U.S.A.

MEIDEN AMERICA, INC. Note 3

US$21.5 million

System engineering, sales, technicalafter-sale service of dynamo products

China

MEIDEN HANGZHOU DRIVE SYSTEMS CO., LTD. Note 3

US$19.0 million

Manufacture of PM motors and other specialist electricaldevices, general purpose inverters, and assembly units forautomatic guided vehicles

consulting,andSpecial Feature

Consolidated Subsidiary Companies as of June 1, 2015
Another 22 companies

Note 1. This is the company created by the acquisition by Meiden Engineering East Japan Corporation of
Meiden Engineering Central Japan Corporation and Meiden Engineering West Japan Corporation on June 1, 2015

Area Code
Japan

Japan

Company Name
Kofu Meidensha Electric Mfg.Co.,Ltd.

Meiden Engineering Corporation Note 1

CapitalBusiness Entity¥400 million

Manufacture and sales of electric motors¥400 million

Manufacture, sale, lease, installation, wiring and provision ofmaintenance services (maintenance and inspection,
modification, repair, etc.) for electrical equipment, machineryand devices

Meiden Plant Systems Corporation¥400 million

Construction services

Japan

M WINDS Co., Ltd.

¥330 million

Business of wind farm and consulting services

Japan

MEIDEN SHOJI Co., Ltd.

¥300 million

Sales of electric components

Japan

Japan

Meiden O&M Corporation Note 2

Meiden Facility Service Corporation¥100 million¥100 million

Strategic proposal and comprehensive management of
manufacture, sale, lease, installation, wiring and provision ofmaintenance services (maintenance and inspection,
modification, repair, etc.) for electrical equipment, machineryand devices and provision of related education
Operation and maintenance of facilities etc., management
and consulting relating to facilities to provide energy such as
electricity, gas, water, and steam, as well as air conditioning
facilities etc. for factories and hospitals etc. and operationand maintenance of tap water, sewage, and industrial water
facilities etc.

MEIDEN KOHSAN CO., LTD.

¥100 million

Japan

MEIDEN CHEMICAL CO., LTD.

¥95 million

Insulating varnish and molded instrument transformer

Japan

Meiden System Manufacturing Corporation¥90 million

Manufacture and sale of switchboards, control panels, andtheir components¥50 million

Software development, design, production, sale, and rental,
and maintenance and management of computer systems
and networks¥25 million

Manufacture and sale of electrochemical measurement
devices, and manufacture of water quality measurement
devices

Japan

Japan

Meiden System Solution Corporation

Hokuto Denko Corporation

Share data (As of March 31, 2015)
Stock Listing
Total number ofauthorized shares
Total number
of issued shares
Number of shareholders

Tokyo Stock Exchange,
Nagoya Stock Exchange

Distribution of shares by shareholder
6576,000,000
227,637,704(Including treasury shares of 733,800)
16,934

5
1

4

3

2

1.

Financial institutions

2.

Securities companies

3.20%

3.

Business companies

21.44%

4.

Overseas investors

13.19%

5.

Individuals

23.14%

6.

Other

0.32%

38.70%

Major shareholders
Name of shareholder

Number of shares held
(1,000 shares)

Shareholding ratio (%)

The Master Trust Bank of Japan, Ltd.

16,216

7.15

Sumitomo Electric Industries, Ltd.

13,156

5.80

Japan Trustee Services Bank, Ltd.

11,212

4.94

Sumitomo Mitsui Banking Corporation

11,209

4.94

NEC Corporation

8,730

3.85

Sumitomo Mitsui Trust Bank, Limited

7,500

3.31

SUMITOMO LIFE INSURANCE COMPANY

5,307

2.34

Meidensha employees stock ownership

5,025

2.22

Mitsui Sumitomo Insurance Company, Limited

4,377

1.93

Friends of Meidensha Shareholders Association

2,767

1.22

Outline of Meiden GroupJapan

Sales of products and materials, and agent services of
insurance

Note 3. Specified subsidiary(Note) The shareholding ratio excludes treasury shares.

41

MEIDENSHA REPORT 2015

A Foundation for Building ValueJapan

Note 2. Meiden Engineering Corporation changed its name on June 1, 2015

MEIDENSHA REPORT 201542

MEIDENSHA REPORT 2015

ThinkPark Tower, 2-1-1, Osaki, Shinagawa-ku, Tokyo 141-6029 Japan

Only environmentally friendly printing
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This report is printed on
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Printed on paper made with woodfrom forest thinning. “Morino
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Association)—Supporting soundforest management.

Only environmentally-friendly, zero-VOC(Volatile organic compounds) 100%vegetable oil inks were used in theprinting of this report.

This report was printed using thewaterless printing method, which
contributes to reduced output ofsolutions from the printing
process that contain organic
compounds.