CSR Report 2007
Corporate Social Responsibility ReportCorporate Data
Corporate Name NTN Corporation
Brand Name
Date founded
March 1918
Head Office
1-3-17 Kyomachibori, Nishi-ku, Osaka,
550-0003, Japan
Representative Yasunobu Suzuki, President
Number of
5,445 (stand-alone), 17,306 (consolidated)
Employees
Fiscal term
CapitalNet Sales
Stock listing
Description ofBusiness
Number of
Subsidiaries

List of Main NTN-group Companies
Japan: NTN Kongo Corporation/ NTN Engineering Plastics Corporation/ NTN
Powder Metal Corporation/ NTN Mikumo Co., Ltd./ NTN Mie
Corporation/ NTN Omaezaki Corporation/ NTN Casting Corporation/
NTN Kinan Corporation/ NTN Kamiina Corporation/ NTN Fukuroi
Corporation/ Hikari Seiki Industry Co., Ltd./ NTN Bizen Corporation/
NTN Bearing Service Co., Ltd./ Kyoei NTN Co., Ltd.
Asia: NTN Manufacturing (Thailand) Co., Ltd./ NTN-NIDEC (Thailand) Co., Ltd./NTN (China) Investment Corporation/ Shanghai NTN Corporation/
NTN-NIDEC (Zhejiang) Corporation/ Guangzhou NTN-Yulon Drivetrain
Co., Ltd./ NTN-RAB (Changzhou) Co., Ltd./ NTN Manufacturing India
PVT. Ltd./ NTN Bearing-Singapore (PTE) Ltd./ NTN China Ltd./ NTN
Bearing-Thailand Co., Ltd./ NTN-Malaysia SDN. BHD./ NTN Korea Co., Ltd.

March 31st
¥42.3 billion (as of March 31, 2007)¥336.8 billion (stand-alone), ¥483.8 billion(consolidated)
The first section of the Tokyo Stock Exchange
and the Osaka Securities Exchange
Manufacture and sales of bearings, constantvelocity joints, precision equipment and otherNorth : NTN USA Corporation/ NTN Bearing Corporation of America/
America
American NTN Bearing Manufacturing Corporation/ NTN-Bower
Corporation/ NTN Driveshaft, Inc./ NTN-BCA Corporation/ NTN
Bearing Corporation of Canada/ NTK Precision Axle Corporation/NTN Sudamericana, S.A.

Japan: 18; Overseas: 31

Europe: NTN WaLzlager (Europa) G.m.b.H./ NTN Kugellagerfabric (Deutschland)
G.m.b.H./ NTN Transmissions Europe/ NTN Bearings (UK) Ltd./NTN France S.A.

America

EuropeAsia
Asia, etc.

Asia, etc.

5,690

59.2

12.2%
32.9%

Regular
Employee(Mar. 2007)

40.0%

Europe17,306(employees)

Europe

6.6%

1,135

Japan

Sales in
16.1% Geographicalsegment(Mar. 2007)

77.7

6,932

46.2%

483.8

(billion yen)

25.5%

Japan

223.6

20.5%

North America

3,549

North America

123.3

1

NTN Corporation CSR ReportJapan

Headquarters
Production Base
Sales Base

Editorial LineNTN started issuing an “Environmental Action Report” in1999 and upgraded it in 2006 to the “CSR Report,” adding
social activities.
This year, we incorporate feature articles in the report
to introduce social contribution activities in which NTN has
engaged. The activities include a case of “creating products
for solving social problems,” activities in China included aspart of “social responsibility associated with NTN’s global
business expansion,” and “events to commemorate thecompany’s 88th anniversary.”In the “Report on Social Activities,” topics are arranged
by stakeholder so that readers can more easily identify
whether the company has fulfilled its responsibility torespective stakeholders. The “Report on Environmental
Activities” focuses on NTN’s environmental targets up to2010, thus making it easier for readers to understand NTN’s
efforts and achievements toward the final targets.
NTN is striving to further improve interactive
communication with its stakeholders. We would be mostappreciative if you would share with us your opinions byfilling out the questionnaire at the end of the report. Thankyou for your cooperation.

Period reported
Fiscal Year 2006 (from April 1, 2006 to March 31, 2007)(Some subjects report information before and after fiscal year 2006.)

Organizations Included in Report
NTN Corporation and its main affiliates(Details are listed in page 1)

Guidelines used for reference
Ministry of the Environment “Environmental Reporting
Guideline (2003 edition)” and “Environmental Reporting
Guideline (2007 edition)” (latest edition)
GRI “Sustainability Reporting Guidelines 2002” and GRI“G3 Guidelines”

Schedule for issuing next report
End of June, 2008
Descriptions of Future Projection
This report describes not only current and past facts, but also the
future outlook and plans of NTN Corporation and its groupcompanies (NTN Group). The future outlook or plans are
assumptions or estimates based on information available at the time
this report was prepared, and include uncertainty. Actual results ofbusiness activities or events occurring in the future may differ fromthe future outlook or plans described in this report.
NTN shall not be liable for such results and asks for yourunderstanding in this regard.

Contents
1

Corporate Data

Report on Social Aspects

2

Editorial Line, Contents

22 Responsibility to Customers

3

Business Scope

25 Responsibility to Suppliers

NTN is supplying products that support “Smooth
motion” in various industries, and contributing toenvironmental conservation and improvement in safety.
5

Message from the President
We aim to establish ourselves as a company in which the
public can have confidence by enhancing Customer Value,
Shareholder Value, Employee Value and Social Value, andalso by actively addressing environmental conservation.

7

Feature Article 1)
Production for Solving Social Problems

13 Feature Article 2)Social Responsibility Amid Global Business
Expansion
15 Feature Article 3)

Memorial Works for 88th Anniversary of
NTN’s Founding
17 Approach to CSR

26 Responsibility to Employees
29 Responsibility to Shareholders
30 Responsibility to Local Communities

Report on Environmental Aspects
32 Environmental Management
35 Targets and Results
37 INPUT & OUTPUT
38 Conservation of the Global Environment
41 Creating a Recycling Society
42 Maintaining and Promoting theEnvironmental Management Structure

44 R&D Efforts to Reduce Environmental

Impacts

45 Site Reports
47 Environmental Performance Data
48 Third Party Opinions

NTN Corporation CSR Report2

Automotive
NTN offers a wide variety of vital products forautomotive applications such as the engine,suspension, transmission, as well as the body andelectric auxiliary equipment.
Today, the automotive industry isconcentrating its efforts on energy saving and theimprovement of safety. Accordingly, NTN is
striving to develop technologies for high function,high precision, and weight reduction, as well as
new processes and hybrid technologies.

Constant velocity joints (CVJ)The CVJ is an important component totransmit the rotational force of an
automotive engine smoothly at constantvelocity to wheels.
In recent years, weight reduction,
power increase and complexity in drive train system are progressing withcars. However, these may become possible factors to may increase noise or
vibration. On the other hand, customers are asking for a comfortable ride.
In response to these requirements, NTN is providing the automotive
industry with CVJs featuring long life, high function, light weight andcompact designs.

NTN is supplying products that support “SmoothBusinessmotion” in various industries, and contributing toScopeenvironmental conservation and improvement in safety.
NTN offers parts and equipment to all areas of industry through its “High precision processing technology” (toprevent “out of roundness” in rolling elements for bearings) and using research in “Tribology” (the study offriction, wear and lubrication). Throughout the world, NTN responds to severe requirements and expectations
from high-tech and other industries through in-house development and production of most products insteadof outsourcing.

Bearings
A bearing reduces energy loss (such as heatgeneration) due to friction at rotating positions ofmachines and allows efficient operation. Bearings
are classified broadly by their rolling element intoball bearings and cylindrical roller bearings. The
roundness of the rolling element is very importantfor smooth rotation.
NTN uses its own Tribological research on
friction, wear and lubrication to develop a wide
variety of high-quality bearings with “out ofroundness” limited to the nano-level.

3

NTN Corporation CSR ReportIndustrial machinery(Earth moving equipment, etc.)

NTN bearings have an excellent reputation for highquality and customers appreciate NTN’s shortdelivery times in response to sudden production
increases. They are often used for wheels anddriving mechanisms of earth moving equipment,
which are essential for infrastructure development.
Recently, projects to develop natural
resources and energy are quite active andbearing demand is becoming higher,
increasing domestic andoverseas sales.

Railway

Sales(Consolidated)

NTN bearings are used for passenger trains andfreight cars as well as Shinkansen bullet trains.
NTN makes every effort to maintain and improve
quality under a special management system, sinceeven a minor defect in the large-scale railway
transport of people and commodities may result inserious damage.
In the interests of environmental conservation
the modal shift to rail transport is increasing andbearing demand is growing worldwide.

(Billion yen)

600
500
400

484

343

357

388

435

300
200
100
0

2002 2003 2004 2005 2006

(Fiscal year)

Operating profit(Consolidated)

29.1

6%
Constant
velocity
joints147.5

30%

Sales bySegment(Term of March 2007)

483.8(billion yen)64%

Bearings

307.2(Billion yen)

60

Office Equipment

Precision equipment etc.

50

Office equipment industries, in which Japan leads
the world market, are our main customer for small
bearings and engineered plastic products. These
industries are in the vanguard of environmental
conservation, and set internal criteria before
environmental regulations become effective. NTN
develops and supplies products that eliminate or
reduce the need for environmentally hazardous
substances.
NTN strives for environmentally-friendly
product development and encourages recycling.

47
38

40

33

30
20

21

25

10
0

2002 2003 2004 2005 2006

(Fiscal year)

Shareholders’ equity(Consolidated)(Billion yen)

250

Fluid dynamic bearing units
Fluid dynamic bearings that have superior
running accuracy and do not cause any
run-out in the rotation of motor spindles
are used for hard disc drives (HDD) in
personal computers, etc.
Lubricating oil is impregnated in
NTN fluid dynamic bearings. They havehigh running accuracy and maintain highreliability for reading data from the HDD
and writing data to the HDD.

203

200
150

183
135

143

158

100
50
0

2002 2003 2004 2005 2006

(Fiscal year)

Total asset(Consolidated)(Billion yen)

800

600
467

460

517

562

612

400

200

0

2002 2003 2004 2005 2006

(Fiscal year)

Number of employees

Precision equipment
Liquid crystal panels and PDPs (plasma display panel) arebecoming larger in screen size and higher in accuracy. At
production sites, NTN’s liquid crystal repair devices andpattern repair devices (NTN’s ultra high precision
positioning technologies) are contributing to improvements
in productivity.
In addition, NTN is continuously supplying highprecision units that are essential for accuracy in the mostadvanced industries, such as semiconductor production
or record storage production, and that are competingwith high density products.

(Consolidated)(100 people)

200

173
146

150
118

119

128

100

50

0

2002 2003 2004 2005 2006

(Fiscal year)

NTN Corporation CSR Report4Message from the President

We aim to establish ourselves as a company in which the
public can have confidence by enhancing Customer Value,
Shareholder Value, Employee Value and Social Value, andalso by actively addressing environmental conservation.

NTN Group strengthens its CSR efforts aspart of the business plan targeting
increased “Enterprise Value”
Fiscal 2006 was the final year of our Rapid Advance
21, medium-term business plan started in fiscal 2004.
The plan aimed to leap the NTN Group forward byachieving targets such as sales of 450 billion yen andoperating profit of 42 billion yen on a consolidated
basis, and also by linking the corporate actions of
employees with increased Enterprise Value.
We are grateful that NTN succeeded in achieving
the targets set, while at the same time expanding ourglobal business by increasing business in China,
establishing a production company in India, andsuccessfully acquiring business in Europe.
In an effort to further promote the NTN GroupCSR activities, we set up the CSR Department at our
Head Office, formulated a set of basic policies,
established the CSR Committee and implemented
CSR-related training programs.
Furthermore, we held a variety of events tocommemorate the company’s 88th anniversary. The
events included an essay contest among NTN Group
employees on the subject “Environmental
Conservation” and social contribution activities atmany locations to express our appreciation to
stakeholders for their support.

We place emphasis on value forstakeholders: Customers, Shareholders,
Employees, and Society
NTN sees CSR as a “core element for management.”
NTN places importance on communication withstakeholders. We aim to become a company that istrusted by society by sincerely responding to the
expectations, interests, and concerns of5

NTN Corporation CSR Reportstakeholders, which we learn through communication
with them. Viewing such trust as a source ofEnterprise Value, NTN will make every effort toincrease customer value, shareholder value,
employee value and social value.
In order to provide our customers with productsof the highest quality available worldwide, we focus
our efforts on research and development, strengthen
partnerships with suppliers and build quality
management structures looking at the total supply chain.
We will carry out intensive IR activities to individual
investors as well as to domestic institutional investors
to explain NTN’s vision and management strategies sothat NTN can be better understood by them.
We promote “HITOZUKURI”*1 through sharing
practical and technical skills at the “MONOZUKURI”*2
manufacturing site, while making efforts to provide a
workplace where female employees can demonstrate
their ability and respond appropriately to diverse
working styles. NTN has set up “Ideal Workshops” at
Iwata, Kuwana, and Okayama Works with the aim to
help disabled people become financially independentand to expand employment opportunities for them.
In the communities where NTN has its businesslocations, we develop closer relations with thecommunity through promoting and supporting
greening activities and sports. NTN also promotes
joint industrial-academic research activities andprovides support to reconstruct after devastating
disasters. Participating in this wide range of activities,
NTN will strive to create Enterprise Value.
*1 HITOZUKURI is NTN’s concept of a system designed to continuously
develop staff who possess essential technical skills and are capable ofworking in an international environment. By identifying the skills of eachindividual and passing down various engineering and technical skills,
NTN plans to increase its on-site capabilities, achieve world class highquality and low cost operations and shorten its production time.

*2 MONOZUKURI is a comprehensive concept of creating value at NTN
throughout the entire business process, including marketing R&D,
engineering, manufacturing and distribution. MONOZUKURI ensures aneven higher level of customer satisfaction thanks to NTN’s competitive
advantages in quality, cost, delivery, development and service.

NTN works to reduce CO2 emissions andwaste materials, and develops eco-friendly
products
In recent years, the global economy has been
continuing its expansion largely driven by the
economic growth in emerging countries such as the
BRIC countries (Brazil, Russia, India and China.)
However, as the economy expands, it worsens
environmental problems. NTN is determined toreinforce efforts to address environmental issues
every time we hear reports saying that global
warming is accelerating.
NTN, across its group companies, focuses ondeveloping its unique “eco-friendly products,” which
are indispensable for realizing an energy efficientsociety. NTN is also working to reduce waste materials.
Regarding reduction of CO2, we are promoting
energy saving by setting up a reduction target for CO2
emissions at every business establishment in Japanand overseas. Further, at newly-established plants, weare making efforts to reduce the amount of CO2
emissions through the use of clean energy by installing
wind generators and solar power generation panels.
In the reduction of waste materials, for example,
NTN has succeeded in substantially reducing wastematerials by pioneering the “grinding swarf briquetting
machine,” which allows the re-use of grinding sludge
generated in the process of manufacturing bearings.
NTN not only uses the machine internally, but also
sells it in the market. NTN is also working proactively
to develop processing machines which allow
significant reduction in consumption of oil andcompact machines which allow conservation ofenergy. NTN is delighted to contribute toenvironmental conservation - the quality ofenvironmentally-conscious management is further
enhanced by these products and activities.
In the development of “eco-friendly products,”
NTN has been making every effort to launch newtechnology and products which help reduce energy
consumption and CO2 emissions. Bearings andconstant velocity joints are respectively used in therotating parts of various machines and fortransmitting engine torque to wheels. Reducing
friction on rotating parts and achieving a high torquetransmission ratio conserve energy that, as a result,will lead to the reduction of CO2 emissions.
In line with these perspectives, NTN is promoting
research and development to produce world-class“eco-friendly products.”

Design, Manufacturing and Sales areworking together for MONOZUKURI to
enhance quality
NTN provides parts that are incorporated in machines
and systems that are necessary to manufacturemachinery. These parts and systems affect theperformance of the machines and end-products. In
other words, the quality of the manufactured goods
can be said to be the most important element for
NTN’s Enterprise Value.
In order to dramatically increase quality, theability to visualize from the design phase to all of thesubsequent processes in MONOZUKURI is required.
Accordingly, our design departments arecontinuously implementing “designs that are easy to

New Medium-term Business Plan
“Growth through Creativity and
MONOZUKURI
Achievements 21”
Further increase quality

HITOZUKURI
Pass down technology
and skills
Optimize working
conditions

Shareholder
Value

Product development
capabilities
Intellectual property
rightsContribute to theenvironment

SocialValue
Employee
Value

Customer
Value

Increasing Market Presence
Establish a strong market presence capitalizing on our global
best-in-class business and products unmatched by our competitors.
Establish a presence in the five major global markets: Japan, theAmericas, Europe, Asia and China.
Become a global company that is capable of bringing out the best inpeople and that contributes to society.

understand and manufacture and that prevent
mistakes” based on the concept that “design
determines everything.” Manufacturing departments
are working to “build in” quality and to pass on quality
control and quality technology, while sales
departments are making efforts to improve customer
satisfaction by quickly identifying technological trends
and changing needs.
We believe that ensuring MONOZUKURI throughunified design, manufacture and sales is thefoundation of further trust from our customers andour stakeholders.

NTN works to create new Enterprise Value
Recently, there have been growing voices demanding
businesses to reinforce legal compliance, risk
management and internal controls. NTN,
understanding these are important CSR issues,
started its response in the early stage.
Requests from society regarding CSR changewith the times. Therefore, each and every employee isrequired to have a broad perspective toward society
and sense social changes. In other words, we believe
CSR requires businesses to take on new challenges
at any time to constantly create new Enterprise Value.
NTN started a new medium-term business plan,“Growth through Creativity and Achievements 21,” infiscal year 2007. “Growth through Creativity andAchievements 21” means to create new Enterprise
Value through continued growth and realizing
significant achievements.
I would be grateful if NTN can get frank opinions
or requests from our stakeholders. We look forward
to your continued support.

Yasunobu Suzuki
President

NTN Corporation CSR Report6Feature Article 1) Production for Solving Social Problems

Development of High-Reliability
Bearings for Wind Power Generators
Toward Expanding Use of Clean Energy
The force of wind is a clean energy that does not discharge CO2.
NTN contributes to the harmonious coexistence of humans and the global
environment by promoting the utilization of clean energy through pursuing
improvement in the performance and reliability of wind generators.

Accelerator

3
1

4

2
GeneratorCoexistence with global
environment as top issue

To prevent global warming, expanding
the use of clean energies is being called
for worldwide. Wind power generationis one source. Wind power is energythat does not discharge CO2 and is
widely used in Europe and America
where there is much level land andstable winds. In Japan, which has
rugged terrain and suffers fromtyphoons, it is used less. However, withimproved facilities and technology, it isattracting attention.
Wind power generation will spreadhereafter and worldwide capacity is
expected to increase from 60,000 MW
in 2005 to 210,000 MW in 2014.
NTN actively strives to develop
environmentally responsible products,
having “coexistence with the global

NacelleBlade

1 Spherical roller bearing

for main shaft

7

NTN Corporation CSR Report

2 Angular contact ball bearing

for reduction gears

3 Cylindrical roller bearing

for step-up gears

4 Insulation bearing forelectrical generator

B
Inspection of bearing for wind generator

environment” as a top management
issue. NTN develops and sells
bearings for main shafts to support
rotation of the blade, step-up gears toincrease the rotation of input shafts,
drive units to change the angle of thenacelle in line with the wind and themain body of the wind generators.

Bearings for wind generators
durable in high speed rotation

Wind power generators are mostly
built in areas far from humandwellings. Windmills are large and arecommonly attached at a height so thatmaintenance is difficult. High reliability
and a long warranty are required forthe key parts.
In recent years, a high-power,large-sized wind power generator has
been in development for greater
efficiency of electricity generation. It
demands an ultra-sized bearing toendure increased loading.
NTN’s “high capacity roller
bearing” responds to the strict needs
imposed by wind generators.
Generally, a bearing increases its
capacity as the number of rollers
increases. Therefore “full complementcylindrical roller bearings” are used inapplications with a high load.
However, a full complement bearing is
not suitable to high rotation speed
since contact of adjacent rollers
increases friction. On the other hand, a“cylindrical roller bearings with cage” issuitable to high rotation speed, but
due to the smaller number of rollers,
the capacity is low.
NTN has tried to develop abearing, that has high capacity as wellas high rotation durability. The
breakthrough was the “rolling element
separator” that enabled the twocontradictory characteristics toco-exist. Placing the plastic separator
between the rollers allowed thebearing to have the advantage of boththe high capacity full complement type
and the high rotational performance ofbearings with a cage. This kind of“high capacity cylindrical roller
bearing” with the “rolling element
separator” attained a rated life* 1.5
times longer than the conventional
bearing.

High capacity

which 90% of similar bearings under identicalconditions can run without fail. It is the standard
scale to evaluate bearing reliability.

New product fulfills to world’s
requirements at Intl. Trade Fair
“WindEnergy 2006”

Cage type

Disadvantage

Advantage

High rotation

Disadvantage

Low rotation due toroller to roller contact
Difficult to separate
sub-assembled innerand outer rings

Newly developed high capacity
cylindrical roller bearing

NTN exhibited its “high capacity
cylindrical roller bearing” with the twoadvantages of a high loading capacityof full complement type bearings andhigh rotational performance of cage
type bearings at the International Trade
Fair “WindEnergy 2006” held in
Hamburg, Germany, exhibiting its clear
advantage of high capacity and highrotational performance. NTN received
high evaluations from many wind power
generator manufacturers.
This product will be thecenterpiece for NTN to strengthen its
lineup of bearings to respond to thedemands from wind power generator
manufacturers. NTN has a plan to build
a production plant for ultra-sized
bearings at Kuwana Works to deploy
this product not only for wind power
generators but for construction
machinery that demands high capacity
and long life, such as wheel loaders(small power shovels running on tires)and dump trucks.

* Rated life is the total number of rotations overConventional type cylindrical roller bearing
Full complement type Advantage

earing lineup strengthened
for wind power generators

Low capacity due tofewer rollers forsecuring cage strength

Developed
With cage
Full complement

Capacity

Rolling element separator(resin made)Permissible
rotation
speed

Handling

On May 16 to 19. 2006, International
Trade Fair “WindEnergy 2006” washeld in Hamburg, Germany, one of thebiggest users of wind energy, andNTN exhibited a new product: the“high capacity cylindrical roller
bearing” developed for wind power
generators.
This trade fair is the third since
2002 and 330 companies from 26
countries exhibited and more than ten
thousand experts and interested
persons attended. Among them were
4 Japanese bearing makers including
NTN and 4 from the West. NTN’s“cylindrical roller bearing” attracted
attention from many experts for its
innovative feature of more rollers toincrease capacity compared to othercompanies.

Rated life

NTN Corporation CSR Report8Feature Article 1) Production for Solving Social Problems

Supplying Key Parts To Improve
Environmental and Safety Performance inAutomobiles
NTN supplies many kinds of products to automakers. Like the automakers,
the important issue for NTN is improving “environmental performance” and“safety performance.” The sense of responsibility that our products directly
influence the performance of the final product is leading to various
groundbreaking technologies.

High rigidity ultra low torquetapered roller bearing

9

NTN Corporation CSR Report100

bearings per car support safety
and the environment

Bearings are a key part supporting the
movement of every machine. In an
automobile, about one hundred
bearings are used - in the engine, drive
train, suspension, transmission,differential, continuously variabletransmission, body, electric auxiliary
devices, etc. to support smooth
motion.
Recently, with the enhancement ofsafety and comfort features, thenumber of motors (and thus thenumber of bearings) has increased.
In 2006, 70 million automobiles
were produced in the world. For an
automobile, the most important issues
are improvement in “environmental
performance” and “safety
performance.” The ever-increasing
automobile has a great impact on theenvironment, and its performance andquality affects many people - including
not only occupants but pedestrians.
Even for bearings used in massquantities, improvement inenvironmental performance and safety
is required.

Measurement of rotational torqueMeasurement of torque loss in differential

Cutting torque in half while
maintaining rigidity and life

The most important thing for increasing
environmental performance isincreasing fuel efficiency.
To increase fuel efficiency, howshould bearings be? A tapered roller
bearing with high rigidity and ultra-low
torque developed by NTN is one
answer. This product cuts rotational
torque in half while maintaining therigidity and life equivalent toconventional tapered roller bearings.
Rotational torque is the force
necessary to rotate the shaft and thesmaller it is, the greater the energy
savings and the higher the fuelefficiency.
Generally, tapered roller bearings
have higher capacity and higher rigidity
than ball bearings, but have thedisadvantage of higher rotational
torque.
To overcome this disadvantage,
NTN focused on the lubricating oil.
Lubrication is essential to reduce rolling
friction in order to prevent seizure, but itis the source of “stirring resistance.” It
is derived from the fact that the
lubricant retained between the rollers
and the cage is stirred by the rollers tobump against the stationary cage,

creating resistance and disturbing thesmooth rotation of the rollers.
NTN development staff
investigated the optimum shape of abearing to minimize the stirring
resistance and finally devised a
specially-shaped cage to make the oilflow easily to reduce resistance. Thisnew type of cage achieved the very low
torque that is half that of conventional
tapered roller bearings.
Diffusing the load by increasing
the number of rollers, thereby
decreasing the load per roller leads tohigher rigidity and longer life, directly
increasing the safety performance of
the automobile.
NTN maintained the bearing lifeand rigidity equivalent to theconventional bearing by increasing thenumber of rollers and by increasing
fatigue strength through special heat
treatment.

Bearing and sensing
technologies combine to
make it intelligent

The high rigidity, ultra-low torquetapered roller bearing is a bearing that
decreases rotational torque to half while
keeping the life and rigidity equivalent tothe conventional bearing.

Shape of cage pocket

Conventional typeHigh rigidity ultra low torque tapered roller bearing

Rotational torque measured

Image of oil flow

Rotational torque (Nm)

1.2

Oil flow

1.0
0.8

Conventional

0.6
0.4
0.2
0.0

High rigidity ultra
low torque tapered
roller bearing

Developed
0

500

1000

1500

This product is used in a driving
unit such as a transmission or differential
where high load is applied, contributing
to higher fuel efficiency in theautomobile. Further, it can be used inindustrial machines such as
construction machines, transportation
machines or hydraulic equipment wherehigh loading is applied. It is expected to
exhibit the same power-saving effect asin the automobile.
NTN will seek to enhance the“intelligence” of constant velocity joints
or hub unit bearings as well as increase
fuel savings, long life and reliability byintegrating rolling bearings and load
sensing technology (such as antilock
brake system), thus improving theenvironmental and safety performanceof automobiles.

“Split type” needle roller
bearing improves fuelefficiency by 3% for
crankshafts and camshafts
NTN has developed a low frictionneedle roller bearing for the support ofcrankshafts or camshafts in
automobile engines resulting in a
sharp decrease in torque.
As a supporting member for the
concave portion of a shaft, a split type“sliding bearing” (slid by means of oil)is conventionally used. By
substituting a “rolling bearing,” we candecrease friction greatly. However it
was considered difficult to split therolling bearings.
However, NTN devised a split
type outer ring and needle(longitudinally long roller) type bearing,assembled by enhancing the accuracyof processing. Torque decreased by
90% for starting the bearing and by
50% for rotation, resulting in
improvement of 3% (10.15 mode) in
fuel efficiency.

2000

Rotation speed (r/min)
For practical rotation speed of 500-2000r/min,
torque decreases half that of the conventional.

NTN Corporation CSR Report10Feature Article 1) Products for Solving Social Problems

Force Sensor for Cerebral Aneurysm
Treatment Reduces Trauma of Patients andSurgeons
NTN technology is also contributing in medical fields.
NTN and the Nagoya Institute of Technology announced the development of
the world’s first “Force sensing system for cerebral aneurysm treatment” inMarch 2007. This is a fusion between technology cultivated by NTN and theresults of research by the Nagoya Institute of Technology
to avoid medical accidents in catheter treatment.

N

TN technology also contributes
in the medical field

NTN developed an artificial heart assist
blood pump in 1991. This productapplied a magnetic bearing floating an
impeller which is also used insemi-conductor manufacturing
equipment where even a little amountof dust is not allowed. Making use of
mechatronics technology (such as asensor, an actuator and a control)
completed the pump. NTN’s originaltechnology used in industrial equipment
proved to be useful in treating
intractable diseases.
NTN currently collects the latest
information from medical equipment
manufacturers, university hospitals andmedical departments to investigate
further our role in the medical field.

C

reating a safer
catheterization treatment

A major trend in modern medical
science, especially in surgery, is“minimally invasive operations,” that is,making incisions as small as possible
and reducing the patient’s trauma asmuch as possible. A typical example isa catheter treatment, where a tiny tube

Lab in Nagoya Institute of Technology

11

NTN Corporation CSR ReportMeasurement of inserting force using silicone cerebral aneurysm

is inserted into a blood vessel to treat
disease inside a body by passing
various devices or medicines through it.
Catheter treatment uses a smaller
incision than a surgical operation with ascalpel, reducing the load for thepatient. For the doctor, a high degreeof technical skill handling medical
devices is required.
Because an inexperienced doctor
may induce a medical accident,
requiring further measures. NTN thus
began research and development on
catheter operations.

Insertion force measured by
sensorInsertion force (N)

0.5

0.4

0.3

0.2
0.1

0.0

0

2

4

Cerebral aneurysm
Coil

6

8

10

12

Time elapsed (s)Force sensing system for
cerebral aneurysm
treatment

While the catheter operation is used forvarious diseases, NTN focused its
attention on the treatment of cerebral
aneurysms. It is the main cause ofsubarachnoid hemorrhage, which has
been increasing, and requires hightechnical skill.
In cerebral aneurysm treatment,
there are methods of using catheters
and of cutting the skull. The catheter
treatment is increasing because it does
not leave an external wound. In theWest, catheterization is used 50% of
the time, but in Japan it is currently
about 20%. Japan’s catheterization
rate is expected to increase to 50%.
NTN worked jointly with theresearch team of Prof. Fujimoto of the
Nagoya Institute of Technology, who iswell acquainted with medical
technology and was the first to tackle
the problems in this procedure. The
most critical issue was thetechnological skill to insert a very thinwire into the catheter with minuscule
force so as not to rupture theaneurysm. For this, significant
experience and skill is needed.
This was the world’s first sensing
system for cerebral aneurysm treatment
developed jointly with the Nagoya
Institute of Technology. This system
can measure and display the minuteforce of the surgeon’s fingertips being

Coil to be packed into
the aneurysm is
attached to the tip ofwire

Sensor integrated with
Y connector
Wire

Insertion force

applied to the very thin wire by opticallydetecting the curvature of the wire. It
uses a sensing technique that NTN has
cultivated in the development of
mechatronics equipment.
With this system, the surgeon can
perform the operation safely, confirming
the appropriate insertion of the wire.
Additionally, as the force applied by asurgeon can be monitored, the systemallows more surgeons to easily learn
and perform the operation.
Further, it is compatible withconventional devices and hygienic due
to being non-contact and disposable.
Catheters are used in many
medical cases besides cerebral
aneurysms. NTN plans to apply thissystem to various other medical
treatments. NTN will deploy its
technology in the medical field to help
maintain and improve the health of thegeneral public.

Prof.

Hideo Fujimoto
Nagoya Institute ofTechnology
Graduate School

Cooperative development with
NTN assures “Best treatment
through the optimal
technique”
Minimally invasive operations, such as
catheterization, which reduce trauma
for patients, is becoming moreprevalent in the medical field.
However, minimally invasive
operations impose burdens on thesurgeon and need very advanced
technology. Quantification of asurgeon’s skill and training
methodology are needed to solve thisproblem.
The recent linking of NTN’sfavorite technology with the pastachievements and strength of our lab.
has resulted in the cooperative
development of a sensing system for
cerebral aneurysm treatment. Thisnew technology pays attention to thetactile feeling of a surgeon’s finger andis expected to apply not only tocerebral aneurysm treatment but tomany other fields. With this system,
I believe we can realize the besttreatment through the optimal
technique.

NTN Corporation CSR Report12Feature Article 2) Social Responsibility Amid Global Business Expansion

Treating Employees and Local People Rightin China and in the WorldA fundamental idea of the NTN Group, having 49 companies and more than
17,000 employees worldwide, is treating people right. We think that it is oursocial responsibility as a global enterprise to give consideration toemployees and people where we are located.
HarbinChangchun

Shenyang
Beijing

DalianChina

Qingdao
NTN-RAB (Changzhou)
Shanghai

Shanghai NTN

Office of General
Manager-China Region,
Shanghai Rep. Office

NTN-NIDEC
FuzhouTaiwanGuangzhou
Hong Kong

Location: Changzhou,Jiangsu Product: Rocker arm bearing
Start of Production: February 2004

Shanghai NTN Corp.
Location: ShanghaiStart of
Production: June 2003

Dandong
Beijing NTN-SEOHAN

Tianjin

NTN-RAB (Changzhou)

Guangzhou NTN-YULON

Product: Hub-unit Bearing
Half-finished product for
constant velocity joint
Ball bearing
Torque limiter

Office of General Manager-China Region,
Shanghai Rep. Office
Location: ShanghaiStart of Office: April 2003

NTN-NIDEC (ZHEJIANG) Corp.
Location: Pinghu, Zhejiang
Start of
Production: March 2003

Product: Fluid dynamic
bearing unit

Guangzhou NTN-YULON Drivetrain Co., Ltd.
Location: Guangzhou, Guang
Start of
Production: June 2003

Product: Constant velocity
joint

China NTN Sales

S

View of NTN Shanghai

Factory entryway

13

NTN Corporation CSR Report

ocial responsibility
accompanies global
expansion

NTN declares “improvement in market
presence” as its long-term vision
toward 2010. To achieve this goal, we
aim to 1) have a strong market
presence and be No.1 in the world in
key products that are unmatched bycompetitors; 2) have a presence in thefive major markets: Japan, theAmericas, Europe, Asia and China;
and 3) be a global corporation being
good to people and contributing tosociety.
NTN entered the markets in North
America and Europe in the 1970s andestablished a production base in Asia in
the 1990s to manufacture and sellbearings, constant velocity joints,
precision equipment, etc. NTN
recognizes the social responsibility
accompanying this global expansion
and thinks that it is most important not
only to comply with laws andregulations as a member of the local
community, but to celebrate thethinking, culture and practices of local
people.

Shanghai NTN also treating
people right

A base of strategic supply for theworld market
Vigorous China has transformed from“the world’s factory” to “the world’s
market” and is expected to groweconomically while awaiting the big
events of the Beijing Olympics in 2008
and the Shanghai International Expo in
2010.
In China, NTN has sited a supply
base for products, semi-finishedproducts and parts, establishing
Shanghai NTN as its first Chinese
production base in 2003. Now, it isoperating to supply strategiccommodities to strengthen NTN’s pricecompetitiveness in the world and toenhance NTN’s presence in the
expanding Chinese automobile market.
Of Shanghai NTN’s sales in2006, 70% is for half-finished andfinished products sold to the NTNGroup and 30% is finished productsthat go directly to customers (direct
sales users).

Dining room in NTN-NIDEC

Production in Shanghai NTN

More than 90% of the sales to the NTNGroup are parts for constant velocity
joints, and by supplying such strategiccommodities, NTN Shanghai is
contributing to the growth of the entire
NTN Group including four Chinese
production sites.
Attaching importance to theeducation/training of
employees
At Shanghai NTN, employees are
increasing in number to enhance
production power to cope with the
expansion of the Chinese market (1,020
persons as of March 2007). In addition,
because many experienced workers areneeded for production, we stress thetraining of employees.
Various plans have been
implemented such as basic education athire, fundamental education on safety,
inspection and measurements, OJT at
each workplace, training in Japan or byengineers dispatched from Japan,
outside training,* etc., based on theannual training plan.
* Training such as safety control, fireman,drainage, heat treatment, chemical control,
training by machine manufacturers andinternal auditors for ISO 14001 and TS16949
are performed by outside companies.

Environment where we canwork with security
NTN Shanghai, for thorough control ofsafety and health, organized a safetycommittee as in Japan and appointed afull-time safety professional. We also
have various activities such as making
every December “safety month” andposting it on the bulletin board andholding a competition about safetyknowledge in order to improve safety
awareness.
Thinking that raising employee
satisfaction is necessary to improve thewill to work and consciousness of safety
and the environment, we give annual
questionnaires about “satisfaction” toemployees and installed an opinion box
in the cafeteria to listen to the voice of
employees. Once we had dissatisfaction
on a caterer in the opinion box and wecorrected the lunch. We are deepening
communication and friendship throughshort trips or having lunch with local andJapanese employees.
To local suppliers
For local suppliers, we conduct site
inspections at manufacturing sites,
100% inspection by machine at delivery
and periodic auditing.
We request each supplier to makedelivery on the 20th of each month andto bill on the 25th, and we makepayment at the end of the next month.
Concern for local environment
To preserve the local environment, we
treat waste water, collect waste by typeand restrict noise levels, based on the
ISO 14001 environmental management
system and we do environmental audits
each year.

Making much of “People”
at all local sites

In China we have three production sites
other than Shanghai NTN: Guangzhou
NTN-Yulong, NTN-NIDEC andNTN-RAB (Changzhou).
Their local contribution activities
have just begun, NTN-NIDEC
implemented a cleaning activity near
the office on January 2007. Guangzhou
NTN-Yulong plan to provide tuition forpoor students starting in 2007.
NTN wants to contribute to local
people in China and in the world.

View of office in Shanghai NTN

Local cleaning activity by NTN-NIDEC

I relish the corporate philosophy of NTN to make much of “People”

Jin XuShanghai NTN Quality Eng.
Dept. Production Eng.
SectionNTN is a top level bearing manufacturer and a huge multinational enterprise. At NTN, I am presently
in charge of introducing new equipment and maintaining and controlling existing equipment as amember of the Production Engineering Section. The meticulous control methodology of Japaneseenterprises is well known in China. Chinese employees were initially doubtful and dissatisfied with it.
However, owing to efforts by top management, improvement in the work environment progressed
rapidly under the Japanese-style control method, and now it is established as the corporate cultureof Shanghai NTN.
With the founding of the labor union, the distance between the company and employees
narrowed at once, I feel. I understood the company is very concerned with the physical conditions,family life, spirit and lifestyle of individuals. All employees feel NTN’s effort to spread and enhance
NTN’s philosophy of “making much of people.”

NTN Corporation CSR Report14Feature Article 3) Memorial Works for 88th Anniversary of NTN’s Founding

NTN Hosts Various Activities Thinking of theEnvironment and Local People
Essay contest called for proposals on safeguarding the environment
NTN celebrated the 88th anniversary of its founding in March 2006. In Japan a
special birthday celebration is held for a person who becomes 88. Then NTN
developed various memorial works for the 88th anniversary throughout all groups.
As a part of this celebration, essays on specific environmental proposals wererequested from group employees. Seventy were submitted. The President’s Award,
the most excellent, was given to Ms. Mika Kohara of the New Product Development
Dept. for her essay entitled “A Proposal of Technology and Commodities which NTN
Should Introduce to Preserve the Environment.”

Mika Kohara
New Product Development Dept.

Thank you for giving me thisaward. Thinking of theenvironment and taking action tobenefit it is very important not only
to maintain our life right now but tomaintain the lives of our children
for the next generation.
I hope all essays submitted will
foment environmental measures tobe promoted by NTN and give an
opportunity to think more deeply
about the environment.

Photo of awardees

Themes of awarded internal essays
AwardeePresidentAward

Excellent
Award

Award

15

Title of essay

New Product Development R&D Center
New Product Development Dept. Mika Kohara

A Proposal of Technology and Commodities which NTN Should
Introduce to Preserve the Environment

NTN USA Corporate Environmental, Health and Safety
Kevin Bulatek

Protecting the Environment through “The Ichiro Principle”

Production Engineering R&D Center
Equipment Development Dept. Shozou Gotou

Contribution to Preventing Global Warming by Steel Dust
Solidification Technology

New Product Development R&D Center
Mechatronics Research Dept. Hiroshi Isobe

New Technology for Hub Unit Bearings to Help Prevent
Global Warming

NBCA NTN Automotive Center, CVJ Business Unit
Paul Tervo

Save Money and the Environment – Overseas Packaging Change

Kuwana Works Personnel and General Affairs Dept.
Masayuki Hiramatsu

The Concept of the “NTN Hometown Forest” and the
Global Environment

Environment Management Dept.
Masayuki Yamazaki

On the Possibility of a Recycle-type Production System – The Futureof NTN’s “Environmentally-advanced Enterprise”

Industrial Sales HQ Osaka Sales Office
Koji Aoyama

Environmental Activity in the Sales Area: A Proposal on
Evaluating the Environmental Contributions of Controlled Sales

NTN Corporation CSR Report

Kuwana Works addressed activity rooted in local area
As a part of 88th anniversary memorial events, each location of our company held
their own activities to contribute to local areas, such as planting vegetation.
NTN has also engaged in social exchanges with local groups and in social
contribution activities, and will promote broader activities in the future in
conjunction with local areas.
Letters formed by persons celebrating 88th anniversary

List of local contribution in 88th memorial works
Procurement : Commemorative tree planting for
HQ
affiliates: Phlox subulata planting and letters
KuwanaWorks
by 650 persons “NTN 88
Celebration”
Practice of “clean operations”
Presentation of grand piano to
Kuwana City (planned)
Wind-instrument contest for 88th
Anniversary
Concert at rest home for the aged
Holding boys baseball tournament

Iwata Works : Donation of “cottage, tea stall andwood wall” to Mitsuke Square(planned) and sidewalk blocks to
Futagoduka Park (planned): Joint tree planting with Bizen City
OkayamaWorks
Presenting care and welfare
vehicle (planned)
Takarazuka : Presentation of hybrid solar street
Works
light
: Cherry tree planting Kayano
NaganoWorks
PlateauNTN Fukuroi : Planting of 88 cherry trees
Corp.
Tree planting activity with affiliated companies

Examples of local contribution activity at Kuwana Works
Maintaining the local
environment

Promoting sports andcultureTree planting of Phlox subulata

Wind-instrument music contest

As part of the 88th Anniversary in March
2007, Kuwana Works, which has beenplanting Phlox subulata for 3 year plans
since 2006, presented 9,000 plants(300m2) of Phlox subulata, (twice that of2006) to Kuwana City and 230
employee volunteers planted them inHarima Central Park.

On March 22, 2007, a contest was held
for wind-instrument music clubs inschools in Kuwana city. The chairman
and adviser of the wind-instrument
league was asked to be the judge andKofu middle school won the award forthe most excellent.
We will make further efforts topromote music in local areas.

Phlox subulata planting

Wind-instrument music contest

Social welfare
Concert at rest home for the agedBoys baseball tournament

We planned a concert by the Kuwana
String Orchestra in the “Heart” rest
home for the aged and held it on
March 2, 2007 with attendance by 140
tenants.
We also donated nursing utensils
and received a letter of thanks from thehead of the facility.

A boys memorial baseball tournament
was held in July 2007, inviting hardrubber ball teams.
This tournament began with thewish of bringing-up sound youth andgrowing amateur sports. The 20th event
was held this year with 16 teams. The
number of teams was doubled as partof 88th memorial celebration.

Concert at rest home

Boys base ball match to compete for NTN Flag

General explanation of
bearings published for thedevelopment of industry
On May 25, 2007 “Understanding
Bearings” was issued from Kogyo
Chosakai Publishing, Inc. This is a
general explanation of bearing
technology, written by 10 employeesof NTN putting their hearts and souls
into it as a part of 88th anniversary.
Kogyo Chosakai issues manytechnical books and said, “There aremany technical books on bearings, but
no book is an easy explanation for
new engineers. Please write such a
primer.” An editing team wasorganized and we expect it willcontribute to the development of the
bearing industry.

NTN Corporation CSR Report

16

Approach to CSR

CSR Structure Established and Full-scale
Activities Started
NTN’s corporate group established a CSR structure as part of its management plan in fiscal 2006, aimed at “Increasing
corporate value.” Considering the “Employee Code of Conduct” and the “Business Code of Conduct” as two supporting
pillars, our CSR activities started full-scale. We distributed CSR guidebooks to every board member and every employee.

NTN’s conceptual framework

Corporate Philosophy
We shall contribute to an international society
through creating new technologies
and new products.
For New Technology Network:
Connect through new technologies
1. Creation of original technologies
2. Offering technologies with added value and services
that are suitable for each customer and end user.
3. Improvement of employees’ standard of living,
distribution of fair returns to stockholders, andcontribution to a society based on the steady growthof our business.
4. Promotion of globalization and formation of acorporate management system, which are essential
for NTN as a leading international company.

CSR Policy
1. Legal compliance/Policy for activities: We shallcomply with both the letter and the spirit of laws andregulations, and carry out our business activities in an
open and honest manner.
2. Customers: We shall strive to develop newtechnologies and new products, as well as to provide
safe and reliable products.
3. Business partners: We shall engage in fair and freecompetition, and at the same time establish excellent
partnerships with our business partners.
4. Stockholders/Disclosure of information: We shall work
to develop this corporation and increase stockholder
return, while at the same time communicating broadly
with society and actively disclosing information.
5. Employees: We shall value the individuality and diversityof our employees, work to create a safe and pleasantwork place, and achieve comfort and prosperity.
6. The environment: With ample consideration topreserving the global environment and protecting theecosystem, we shall work toward the creation of asustainable, progressing society.
7. Society: We shall make every effort to interact
meaningfully with society on a local level, and to engage
in activities that contribute to society.
8. International activities: We shall, as a matter ofcourse, obey all international rules as well as the lawsof each country and each region that we operate in;we shall also respect local cultures and practices andcontribute to local development.

17

NTN Corporation CSR Report

Corporate Philosophy
Basic concept of values as a corporation
Aims of corporate activities

CSR Policy
Corporate Code of Conduct to stakeholders
2 pillars promoting
CSR activities

Employee Code of Conduct

Business Code of Conduct

Guideline to encourage
aggressive actions

Guideline forcompliance actions

Establishment of CSR basic policy
CSR involves all the stakeholders of the company and its
scope is widening.
Also, it is important for the promotion of CSR
activities that the corporate policy be disclosed both
inside and outside the company and that every employee
takes concrete action at their work site.
Accordingly, we defined NTN’s “CSR Policy” toclarify the essential points as basic concepts. The newly
established “Employee Code of Conduct” wasdistributed to all the board members and employees of
NTN Group companies.
We already established the “Business Code of
Conduct” in 2003 that must be complied with by the boardof directors and employees. In December 2006, theBusiness Code of Conduct was revised to correspond with
the CSR policy (see p. 20) and with the Employee Code of
Conduct were regarded as two pillars.
CSR activities are company-wide efforts byeveryone in all departments and at all operation sites inorder for the NTN Group to be needed by society. The
structure promotes positive activities, and the activities
reflect the interests of stakeholders. We aim to be a
corporation that is trusted by society.

Employee Code of Conduct
1. We respect social ethics and act as good membersof society.
2. We have noble ambitions and always make efforts tobrainstorm and achieve the set target.
3. We accept changes, have broad vision and act
voluntarily.
4. We deepen mutual understanding and enhance thevitality of our work site.
5. Management and supervisors in particular, as faces of
the corporation, improve their qualifications, makeefforts to develop individuals, always take care ofsafety and show leadership.

Approach to CSR

Corporate governanceCorporate Governance Structure Chart
Stockholder meeting

One of our most important issues for management
Regarding the strengthening and enrichment of corporate
governance as one of our most important issues, we are
striving to improve management transparency by disclosing
information swiftly and accurately as well as pursuing
greater efficiency and soundness in our management.
We employ an auditor system; auditors monitor theboard’s execution of business operations. The independence
and objectivity of the corporate auditors are assured by
employing three outside auditors among the four auditors(Standing: 2, Part-time: 2), comprising the audit team.
In May 2006 when Japan’s new corporation law wasenacted, the corporate internal control policy wasestablished. It defines a structure to ensure proper
operations by employees as well as by the board of
directors and auditors.

Assignment/
RemovalAuditors

Assignment/
RemovalAssignment/
Removal

Accounting
Auditors(Audit firm)

Board ofDirectors

Audit

Business Strategy
Committee
Operating Officer
Committee(Other positions omitted)

CSR Committee Organization Chart
Chief Management Officer(CSR Department)

Sales Planning Department

Procurement Department

Quality Management
Department

Intellectual Property
Management Department

Environment Management
Department

Personnel Department

Legal Department

General Affairs
Department

CSR Committee as a Promoter
In April 2006, we established the CSR Department andcreated a structure to promote CSR activities, assigning a
director as the chief management officer and started CSR
activities in full scale. This new structure assigns a CSR
manager to each department under the “CSR Committee”
and aims to implement CSR activities on a day-to-day basis.
Also, in order to deepen the understanding of CSR
and integrate it into daily business operations, NTN
distributed approximately 7,500 “CSR Guidebooks” that
introduce many examples and “Response Cards” inDecember 2007 to the board of directors and employees
at NTN and its domestic group (including employees
temporarily transferred to overseas sites). Furthermore, inJanuary to March 2007, explanatory meetings on the
CSR Guidebook were held for managers (616) of NTN
and its domestic group companies at 22 operating sites.

OfficeCSR Committee

Management Planning
Department

Creation and activities of
CSR promotion structure(Director in charge of CSR Department)

Relevant Departments
in Charge at Head Office

Board of Directors Meeting
Makes decisions related to fundamental management policy andsignificant items. and supervises the board’s execution.
Audit Team
Composed of four auditors (three of whom are outside auditors). The
auditors team audits the board’s execution of business operations
and works to maintain and improve the transparency and fairness ofthe management structure.
Business Strategy Committee
Composed of the board of directors and designated executive
officers. The Business Strategy Committee determines management
strategy and measures based on the policies determined by theboard of directors.
Executive Officers Meeting
The executive officer structure was introduced to slim down theboard of directors and to make swift decisions.

CSR Managers in Plant, Engineering Department,
Research & Development, Sales, Head Office, Group Companies

CSR Report
Committee

Compliance
Committee

Risk Management
Committee

Social Contribution
Committee

Left) “CSR Guidebook”
Compiled focusing on instilling the corporate philosophy andclarifying compliance
Right) “Response Card”
For use at meetings, etc. in production departments

NTN Corporation CSR Report18Compliance management structure

Clarifying compliance criteria for board of directors
and employees
In 1997, we established the “Corporate Code of
Conduct,” which declared NTN’s dedication to its
responsibilities to customers and stockholders, NTN’s
respect for the human rights of employees, its aim tocontribute to society and NTN’s environmental
conservation as well as NTN’s compliance with both theletter and the spirit of laws and the maintenance offairness in corporate conduct. Also the “Employee Codeof Conduct” was established to encourage employees tocomply with laws and corporate regulations, to takeresponsible actions and to serve society’s interests. In
2003, the Corporate Code of Conduct and the Employee
Code of Conduct were united to further strengthcompliance and the Business Code of Conduct wasestablished as a matter of mandatory compliance for theboard of directors and employees.
In fiscal 2006, after preparing the CSR Policy(specifying the corporate social responsibilities) and the
new Employee Code of Conduct, the Business Code of
Conduct was revised to clarify the nature of compliancecriteria for the board of directors and for employees.

CSR / Compliance Education
At NTN and its domestic group companies, training on
CSR, compliance and corporate legal work are
conducted as part of newly hired employees’ training
and as managers’ training after promotion.
In 2006, “CSR / Compliance Education” and“Corporate Legal Work Education” were conducted for
employees having worked for two years. Explanatory
meetings on compliance were held for all managers.
In 2007, an electronic “Compliance Message
Board” for self study concerning compliance will be
developed and put into use.

Explanatory meeting tomanagers about theimportance of CSR andcompliance.

Compliance Committee and Help LineManagement Structure
Compliance Promotion

Reorganization toward management structure
centered on the CSR Committee
Since 1997, the Corporate Ethics Committee has taken
charge of ensuring compliance at NTN.
In July 2006, the CSR promotion structure wasformed and the compliance management structure wasreorganized under the newly established CSR
Committee. The CSR Department is in charge ofinvestigations and analysis of compliance risks, The
Legal Department is for education and help-line
management concerning laws. The Personnel
Department is for drafting and enforcement of personnel
policies and measures etc. Accordingly, acomprehensive judgment of the NTN Group’s
compliance situation is made under this structure.
Furthermore, from December 2006, the ComplianceGroup of the CSR Committee has promoted compliancemanagement and its management duty was transferredfrom the Legal Department to the CSR Department.
Compliance Audit
The compliance status regarding laws and corporate
ethics is audited by the Internal Audit Group of the CSR
Department.
The audit was formerly conducted by the Legal
Department. In the past five years, no major problems wereobserved although minor improvements were directed. In
2006, the security export control operation (concerning
Japan’s foreign exchange law) at the International Trade
Department was audited and no violations were found.

19

NTN Corporation CSR Report

Help Line Management

Chief Management Officer

Chief Management Officer(Board Director in charge of CSR Department)(Board Director in charge of Legal Department)

CSR
Committee

Office(CSR Department)

Legal
Department

Compliance
Sub-Committee
CSR
Legal
Personnel
Management
Department Department Department

External
Consultation Desk

Internal
Consultation Desk

CSR Manager

Directors and employees in NTN Group

Corporate
Philosophy

CSR Basic
PolicyEmployee
Code of
Conduct

Business
Code of
Conduct

Help desk for inquiry/consultation/
reporting
Available not only for NTN employees but also
for suppliers
At NTN and its domestic group companies, in the casethat any directors and employees find or foresee illegal
or suspicious conduct, NTN has made available since
May 2003 the Operation Code of Conduct, Corporate

Approach to CSR

Business Code of Conduct
1. Compliance with laws and norms
We shall do our utmost to act according to high principles as corporate employees and as socially responsible adults bycomplying with laws, our internal rules and the ethical norms of society.
Code for business activities
2. Pursuit of quality and safety
3. Compliance with the Anti-Trust Law 4. Fair trade with suppliers
5. Honoring agreements
6. Refusal to engage in improper conduct with business partners
7. Proper labeling and specification
8. Respect for intellectual property rights
9. Proper control of confidential information 10. Ensuring security by strengthening export controls
11. Compliance with industrial laws
12. Compliance with corporate accounting principles
Code for co-existence with society
13. Compliance with international rules 14. Promotion of environmental conservation 15. Positive contribution to society
Code for ensuring a positive work environment
16. Compliance with labor-related laws and company work rules
17. Realization of a safe and positive work environment 18. Respect for human rights 19. Prohibition of sexual harassment
20. Proper control of information about individuals
Code for corporate employees
21. Strict distinction between public and private matters 22. Confronting harmful social forces
23. Proper utilization of our information system
24. Prohibition of insider trading
25. Self-restraint regarding entertainment and gifts
26. Lawful donations/political donations

regulations and help lines that the person may consult
directly through telephone, fax or e-mail without going
through organizational lines. Two routes are available:
our Legal Department is an internal desk and our
corporate lawyer serves as an outside help desk. Bothroutes are operated so as not to be detrimental to those
who contact the desks.
In April 2006, a whistleblower protection law,
specifying that dismissal due to disclosing information in
the public interest is illegal, was enacted.
In response to this, our suppliers were informed of
the opening of our Help Line, “CSR Guide Books” were
distributed, describing how to use the Help Line andeveryone was informed about compliance at explanatory
meetings.

Compliance status regarding laws
and corporate ethics
Making our attitude clear aiming at eradication of
drunk-driving
If laws or corporate ethics are violated, our Legal
Department investigates the case and reports to thedirector in charge of the Legal Department and theCompliance Group of the CSR Committee. The
Compliance Group shall study countermeasures andcorrective actions based upon the report and deploy them.
In fiscal 2006, there were no problems inoperations, but there were two violations of the Road
Traffic Act outside of business activities (property
damage and an accident due to driving under the
influence of alcohol). Concerning these, the Personnel
Department informed the NTN Group in Japan andreinforced the corporate attitude about eradicating
drunk-driving by adding a new regulation: “Serious
violations of working regulations shall result in a
disciplinary discharge.”

Risk management and confidential
information management
Strengthening preventative management of risk
In 2001, we established the Emergency Management
Center* to manage the response and countermeasureswhen risks arise. Risks relating to quality, the environment,
natural disaster and compliance are emphasized.
In March 2007, the “CSR activity managementrule” was revised to strengthen preventative risk
management and the Risk Management Group under
the CSR Committee was established.
* Emergency Management Center: Responsible for receipt of emergency
information, study of proper counter measures, reporting of emergency
information, establishing of emergency Headquarters, document
retention and education.

Management of Confidential Information
For proper management of information, a “confidential
information retention rule,” “electronic confidential
document handling rule” and an “information security
countermeasure procedure” were prepared andcirculated to all operating sites and affiliates.
When confidential information is taken outside thecompany, permission of the department manager must
be obtained. For electronic media, use of UBS memory
with a password is required. No incidents have occurredunder this system.

NTN Corporation CSR Report

20Report on Social Aspects
The company group recognizes its responsibility to all stakeholders andendeavors to abide by that responsibility in its corporate activities.

22

Responsibility to Customers

25

Responsibility to Suppliers

26

Responsibility to Employees

29

Responsibility to Shareholders

30

Responsibility to Local Communities

Responsibility
to customers

Responsibility
to localcommunities
R

Responsibility
to shareholders

21

NTN Corporation CSR Report

Responsibility
to suppliers

Responsibility
to employees

Responsibility to Customers
Report on Social Aspects

Aiming to Provide Optimum Quality and Service
The company made “improvement of corporate value” as the basic policy for the medium-range management plan. One
part gives importance to customer satisfaction - provision of optimum quality and service. In 2006, we promoted
continuous activity to ensure customer satisfaction as well as to maintain safety and quality.

Basic quality policy

Quality Assurance System Chart
Quality Basic Policy

Quality improvement for customer satisfaction
This company thinks the most important thing forcustomers is to maintain and improve quality.
Under NTN’s “basic quality policy,” we pursue
appropriate quality for customers from three points ofview, “applicable quality,” “competitive quality” and“economic quality.”

Quality control policy for 2006

Aiming at top quality with zero claims
Based on its basic quality policy, the company
determines an annual “quality control policy” in theEngineering, Production and Sales departments.
The Policy and details for each department for 2006
are as shown below.
In 2006, for manufacturing quality that satisfies(Quality Control Provision)
Director in charge of Engineering
R&D General Manager
QA Dept.
Manager Meeting

Quality Control Policy(every year)

R&D Center

Quality Management Dept.

Division General Manager

Eng. Dept.
Action Policy

Basic Quality Policy
Pursuit of appropriate quality satisfying performance andspecification requested by customers
Quality applicable to the various requests of customers(applicable quality)
Superior quality in the marketplace (competitive quality)
Quality profitable to the enterprise (economic quality)

Instruction
Feed backDivision Quality Policy

Engineering Dept Manager
Plant Manager

R&D Center Policy

R&D and Eng.
Development Plan
Review Meeting[HQ Management Dept.]

Coordination
Meeting

QA Dept. Manager

Major issue/Goalsetting
by Dept./Section
Manager

Coordination
Meeting

Plant Manager

Deployment andpromotion throughorganization,
QC Circle Activity

Follow-up
Meeting

Plant Manager Dept./
Section Manager

Plant Quality Policy
Dept./Section Manager

customers, the annual theme was “Quality is NTN’s brandpower. We will achieve zero claims and attain No.1 global
quality by building quality into the manufacturing process.”
The theme was posted and engaged in by the NTN group.
We set a new theme for 2007, aiming at further
improvements in quality.

Quality Control Policy for 2006
Engineering : “Design determines all” will be continued
Continued from 2005, this concept aims at claim prevention at the root source, with enhanced verification at thedesign stage, with drawings conforming to production needs. We promote the following views: 1 ) to understand theperformance demanded by customers and service conditions, 2 ) robust design* aimed at eliminating claims in themarket, 3 ) designs easy to understand, easy to manufacture and difficult to mistake.

Production : Prevention of claim recurrence and ensuring quality of new products
For newly launched products, to improve quality through building quality into the product and preventing claim
recurrence, we promote the following points, 1 ) reorganization of the domestic quality control system, 2 ) constructionof a global quality control system, 3 ) handing down of quality-oriented technology and skills, 4 ) guidance to affiliatedcompanies.

Sales : Provide what the customer demands
To satisfy customers, we promote, 1 ) better evaluation of and knowledge of what satisfies customers 2 ) knowing
customer requirements and communicating them.
* robust design:design not affected by variations in production and the environment during service.

NTN Corporation CSR Report22Responsibility to Customers

Quality management system

Quality management system conforming tointernational standards
NTN has devised a quality management system
conforming to the requirements of ISO 9001:2000 in all
business divisions. Moreover, in business divisions
manufacturing automotive products, we also acquired
ISO/TS 16949:2002 certification*.
By operating such a management system andstressing continuous improvement, we prevent
nonconformances and provide products that can berelied on by customers.
* ISO/TS 16949:2002: The highest quality standard system incorporating
specifications established by American and European manufacturers
based on ISO 9001:2000.

Highest quality certification in theautomotive industry
The company acquired certification of ISO/TS 16949:2002
in its 5 domestic business divisions in 2004 and has
Scope of application
Automaker-specificrequirements
Automotive
commodities

Automotive
industry-specificcommon requirements

ISO/TS 16949
Scope ofcertification

ISO/TS 16949
Requirements

Industrial commodities
ISO 9001 Requirements
and others

expanded it to 10 sites including 9 overseas businessdivisions.
Under this quality management system, which
satisfies requirements for automotive products, we arecontinuously addressing the prevention of
nonconformities and troubles in the supply chain andthe reduction of quality variation and waste to provide
the highest quality product to automobile manufacturers
worldwide.

User support system

The importance of information provision anddirect communication
NTN, as part of promoting an “increase in customer
satisfaction by providing the highest quality andservice,” allocates fulltime sales personnel and sales
engineers for major customers and sales agents so as
to be able to directly respond to all requirements. As tobasic product information, we distribute productcatalogues and handbooks by product and provide
technical information directly.
We seek to increase opportunities to hold exhibitionsof products at customers’ facilities and for engineers to go
and hear directly from customers. In 2006, we held 8
exhibitions at customers’ facilities. The results ofquestionnaires after exhibitions have been favorable andwe are judging that we have been successful.
For questions and claims from customers after
delivery, we have a system to receive them at eachbranch and respond quickly to them.

Response to major problems
Major customers who require conformity to
ISO/TS 16949:2002, sites and commodities
Customer

Ford

Customer-specificrequirement
Ford Motor Company
Customer-Specific
Requirements For Use
With ISO/TS 16949

Site in charge

Cylindrical roller bearings
Kuwana Works
for automobiles
Iwata Works

Daimler
Chrysler

Belt-tensioners

Okayama Works Axle bearings
Iwata Works

Guideline for Quality
Assurance in ProductRealization (Europe)

Commodity

Ball bearings for automobiles
Needle roller bearings
for automobiles

Ball bearings for automobiles
Kuwana Works Cylindrical roller bearings
for automobiles
Tapered roller bearings
Okayama Works for automobiles
Axle bearings
NTN Kongo Corp. Ball bearings for automobiles

Customer-Specific
Requirements for use
Nagano Works Autotensioners
with ISO/TS 16949 (US)GM

23

Customer Specific
Requirements
For Use With
ISO/TS 16949

NTN Corporation CSR Report

Iwata Works

Needle roller bearings
for automobiles

Sales, Quality Assurance and Engineering/Research divisions combine
For any major quality problem, the company has asystem that will immediately organize a special
emergency structure across the Sales, Quality Assuranceand Engineering/Research divisions to handle and settle
it as soon as possible.
In 2006, we had no major quality problems.

Thorough education of employees
Since the establishment of confidentiality rules in 1991,
the company has endeavored to make it known toemployees to protect information obtained from
customers.
To those who are transferred or dispatched todepartments handling much customer information, we
explain our policy of how to respond based on
confidentiality rules as introductory training. In 2006, 54
people assigned to the Sales Division were trained on
confidentiality rules and document control.
As a result, there were no violations of proprietary
information procedures in the company or at affiliates.

Report on Social Aspects

Appropriate control and protection ofcustomer information

Educating sales agents on product technology
The company uses a Sales Agent System and organizeda Domestic Sales Agent Association consisting of 65
companies. NTN periodically holds exhibitions andtraining courses. It also educates about producttechnology in order to improve the understanding of theconstruction and performance of products and how tohandle them.
In 2006, we held a domestic sales agent meetingand conducted a technological class at that meeting aswell as at each area. We received favorable evaluations
and judged that certain results were obtained regarding
technological understanding. In the future, we plan tocontinue and enhance this technological class.

Asking affiliates for cooperation

Addressing quality improvement with suppliersThis company holds annually quality audits or “affiliatequality improvement meetings” with business partners(suppliers) from whom we receive parts and materials. At
affiliate quality improvement meetings, the top
management of affiliates are invited to participate andthe results of activities are presented.
In 2006, under the theme “Quality shows NTN’s
brand power to customers,” 128 companies
participated. Quality improvement successes were
presented by 3 companies with customers participating
and giving lectures on quality.

Awards Ceremony for successful results

Domestic Sales Agent Meeting Awards Ceremony for overall excellence
From left: Daijiku Co.
Nitto Shokai Co., Ltd.
NTN President Suzuki
Toamec Inc.
Hamasho Corp.

Contact windows for customers

Aiming to improve customer satisfaction
Communications from customers are received throughtelephone as well as through the internet homepage andthe sales agent order system (e-Wings). A system has
been prepared so that the person in charge of the contact
window immediately responds to any communication.
The company included “brand power
improvement” in its medium range management plan,and to realize this, is especially promoting theimprovement of customer satisfaction as the mostimportant activity. As one project, a system wasconstructed so that a fulltime sales person and engineer
are assigned to respond directly to inquiries from major
customers and sales agents. We strive to holdexhibitions or engineering seminars at customers’facilities to increase the opportunities for NTN engineers
to hear from customers.

Affiliate quality improvement meeting

NTN Corporation CSR Report24Responsibility to Suppliers

Creating a Good Partnership with Suppliers
The company is striving to create a good partnership with suppliers through clarifying its basic policy of procurementand developing and maintaining fair transactions with suppliers.

Basic procurement policy

Basic Policy on CSR Procurement
1. To pursue stable procurement for best quality/costand prepare for market fluctuations.

Improving corporate value together with suppliers
Our basic policy of procurement is to improve corporate
value long-term together with suppliers throughprocuring better and cheaper products from the world
while assuring quality (including impact on theenvironment) and performing just and fair transactions.
The procurement strategy of this company is torealize the most appropriate procurement while
continuously improving quality and technology, by
attaching great importance to long-term relationships while
fostering mutual trust and cooperation with commission
agents who are positioned to be strategic partners.
Procurement policy of 2006 and the summing up
NTN’s procurement policy for 2006 is “to maintain stabledelivery quality” and “decrease procurement costs.” We
continuously worked on VA*1 and VE*2 together with
suppliers.
As a result, we have improved our quality further
and reduced costs. In 2007, to strengthen the activity,
we will promote cost reductions throughout allprocesses from raw material to products at suppliers’
production sites.
*1 VA (Value Analysis): Systematic control method for changing design or
specifications, reviewing alternate products, etc. to achieve the bestbalance between performance and cost.
*2 VE (Value Engineering): A series of methods to enhance relative valueof products by factor analysis and review of product value and cost.

Opening of Supplier Meeting
This company holds Supplier Meetings to explain
production to major suppliers twice a year (in March and
September).
In the March 2007 meeting, suppliers were evaluatedon various aspects such as production (increased
production), cost, VA/VE, certifications such as ISO 9001,
ISO 14001 etc., and 8 companies received an award.
In addition, the 4 basic policies of CSR
procurement was
explained in order to sharethe idea of CSR. We gavethem guidance regarding
the acquisition ofenvironmental certification
Luncheon at Supplier Meeting as specific assistance.

25

NTN Corporation CSR Report

2. To improve corporate value for both sides throughmutual cooperation.
3. To create trust with affiliated companies by observing
rules, regulations and social precepts.
4. To comply with social duties (such as preservation of
the global environment) through procurement activity.

To maintain fair and appropriate
relationships
System to implement fair transactions
through auditing
This company created a “voluntary audit manual for
subcontractors” in 1997 and created a system to audit
internally and ensure fair transactions. In addition, in
November 2001, we issued the “Control manual for raw
material procurement” for the purpose of respecting
suppliers’ interests and performing fair transactions
based on the principle of faith and honesty as we haveselected, contracted with and evaluated suppliers.
As of March 2007, the company has 1,294
domestic suppliers in total and 409 companies are subject
to the subcontract law (the Act against delay in payment
of Subcontract Proceeds etc. to Subcontractors).
Based on the voluntary audit manual for
subcontractors, Procurement HQ audits each plant on
payments and found no improper transactions in 2006.

Contact window for suppliers

Operation of help line for suppliersWith NTN’s public interest whistleblower protection
system established in April 2006, we made a system thatreceives communications from suppliers and linking to
NTN’s Help Line (see p. 19) for public interest reporting.

Responsibility to Employees
Report on Social Aspects

Respect Diversity and Create a Safe and Easyto-Work Workplace
NTN supports these measures so prosperity materializes for all. NTN aims to create an evaluation system that allows
diverse individuals to demonstrate their ability, to provide equal opportunity in employment, to provide a safe, healthfuland comfortable working environment and to support career planning and personal development.

Employee circumstances

Increased employees for succession oftechnology and skill
With business expansion at home and abroad and justbefore the retirement of the baby-boom generation, thecompany increased consolidated employees by 2,675
from the previous year, securing persons to succeed tocore technology and skills.
As a means to retain persons for succession ofskills, we introduced a system for temporary
employment from 2005 and employed persons for aneffective term of 6 months, mainly for production. As of
March 2007, this company has 172 persons and 184
persons consolidated (an increase of 78 and 80
respectively vs. previous year). Also we have a system
where a temporary employee who has worked over one
year and is recommended by the workplace may
become a regular employee. In 2006, 82 persons (89 inconsolidation) became full-time.
Number of employees

Non-consolidated regular
employees (male and female)
Consolidated regular employees(persons)

20

17,306

11,18011,885

12,78810562

0Basic policy for personnel affairs

14,631

15

5

We think that holders of diverse thoughts andsenses of value will stimulate each other and bring
dynamism and originality to the corporation. For that, wemust prepare a working environment to improve
productivity and employee satisfaction, where various
able persons can display the most of their ability, It isalso important to allow a variety of working styles formaking use of their various abilities.
Based on this concept, we strive to create a justand fair workplace environment where human rights arerespected and no discriminating acts such as sexual
harassment exist. Such an attitude is defined in the CSR
basic policy. To become awareof this policy, all are
instructed thoroughly, for example, at new manager
training on labor management or newcomer training.
With business globalization, we do not admit any
child labor nor forced labor, and request the same fromsuppliers.
Female employees are 8.0% and female managers
are as yet few, but are increasing.
We will bring up personnel adapted to their
qualities so that they can play active roles in various
workplaces and we will expand opportunities forfemales to work.

5,867

2002

467

445

436

434

5,109

5,020

5,006

5,011

2003

2004

2005

2006

(Fiscal year)

Basic policy of employment andprotection of diversity in theworkplaceCreation of a workplace respecting human rights
NTN and related companies defined the basic policy of
employment in a Labor Agreement in 1982 that “for thecause of nationality, belief or social rank, we shall notdiscriminate on wages, working hours and other working
conditions.” NTN also declared the respect of humanright as a major principle.

Just and fair performance evaluations andemployment decisions
As to payment for the employees, as the basic policy,
corporate performance is reflected in bonuses andindividual performance is reflected in raises orpromotions through the personnel performance
evaluation system.
Evaluation criteria to determine pay and position isbased on implementation of just and fair performance
evaluations and determination of treatment according to
NTN’s “personnel performance evaluation manual.”
Payment is systemized with a combination of
person-based wages and performance based wages. In
Japan, the person-based wage is determined by age,whereas the performance-based wage is determinedusing a wage table based on the assessment according
to the personnel performance evaluation manual.
A comprehensive evaluation is made by several
evaluators from various points of view. We endeavor topractice just and appropriate performance evaluations.

NTN Corporation CSR Report26

NTN supports job and family balance

Enriching the system to help balance family
and career
NTN tries to enrich various systems to support
employees who aim to balance job and family.
In Japan in 2006, we introduced a reemployment
system (the momback system*) for female employees
who resigned their job due to childbirth or childcare. We
increased half-day vacations available in January 2006 toenable male and female employees to utilize paid
holidays for child care purposes.
We also have a nursing holiday system that allows
a one-year leave of absence and one person is utilizing
this system now.
We are now designing a new welfare program tobegin in 2008 to assist childcare and nursing.
* momback system: by registering at resignation, reemployment ispossible as demanded once a working environment is arranged.

Outline of Assistance System for child raisingThis company

Designated by law

Hospital visit leave
for pregnant female

Officially admitted−

Leave before
childbirth

6 weeks with pay

Without pay

Leave afterchildbirth

6 weeks with pay

Without pay

Childcare leave

Guaranteed bonus ofWithout pay or bonus
150,000 yen minimumChildcare time

Twice a day with pay(1 hour each time)

30 min/each time
without pay

Exemption fromovertime

Until child enterselementary school“Best efforts”
obligation from
3 years old* There are also measures to reduce overtime, exemptions from midnight“dynamic vigor“ is to perform conventional duties while
making the most of cultivated technology, skill andspecial knowledge.
In 2006, 79 qualified persons are in this system
and more than 77% of the applicants are reemployed.

Employment of the disabled

Addressing employment of the disabled in the“dream workshop”
As the main policy for employment of the disabled, we
strive to surpass the official rate of disabled employment
and to ensure all employees play an active role in theworkplace. In addition to NTN’s standard workplaces,
we opened a dream workshop in 2004 in three plants,
creating a workplace specially adapted for the disabled.
In 2006, our employment of the disabled is 82
persons, including 6 in “dream workshops.” This is a
1.98% employment rate for the disabled, compared tothe official rate of 1.8%.
Hereafter we will try to expand the kinds of jobs
and increase the number of persons participating to
expand employment opportunities for the handicapped.

Operation of packaging in “Dream Workshop”

shift and system of leave for nursing.

Occupational health and safety
Reemployment system

System to ensure technology, skills and special
knowledge are handed down
The company has operated a reemployment system for
employees including related companies from 1982. In
2006, we started a reemployment system for those in
their early 60s and we reemploy persons irrespective of
the kind of work under two courses: “certain transfer”
and “dynamic vigor.”
The certain transfer course is to pass down
technology, skill and special knowledge and to guide theyounger employees who inherit them. The course

27

NTN Corporation CSR Report

Improvement in occupational health and safety
In order to assure safety and health in the workplace andprovide an environment comfortable to work in, we set
and execute a “safety control plan” every year.
In 2006, we set “preventive control measures” as
the major target and addressed important issues such as1 ) acquiringcompany-wide safety and health management
system certification (OSHMS); 2 ) implementation of risk
assessments; and 3 ) strengthening of mental healthmeasures.
We acquired the OSHMS certification for sevendomestic divisions in April 2007. Based on the OSHMS

Frequency rate/Severity rate
Frequency rate (Numberof dead and injured)

2.5
1.79
2.0
1.5
0.85
1.0
0.5
0.15
0
0.16

Severity rate(days of leave)

0.12

0.130

1.77

1.78

1.85

1.95

1.90

0.87

1.01

0.99

0.95

1.17

0.15

0.26

0.120

0.120

0.120

0.040

0.030

0.23

0.35

Rewarding job-related inventors

Rewards for job-related and un-related inventions
We encourage employees to develop patents and to
improve NTN’s technological competitiveness. We
attribute patents and judge their potential worth throughour “patent control program” and “patent reward
program.” There is no upper limit for the reward.
Inventions to be kept as trade secrets may also receivea reward.
In 2006, NTN paid awards for 2,233 patentapplications, 191 registrations and 32 awards forachievements.

0.34

Reducing overtime
0.120

0.120
0.070

0.08
0.04

Average in Japan
Average in bearing manufacturing
Domestic group (5 divisions and3 group companies)

Report on Social Aspects

system, we plan to improve the level of health and safety.
Our risk assessments involve investigating andidentifying dangers based on an analysis of past labor
accidents and preparing work instructions to decreaserisk levels.
In the health and safety control plan for 2007, theeradication of labor accident at non-stationary works andthe firm establishment of OSHMS are important items for
implementation.

0.030

0 0.003

2001

0.003

2002

0.003

2003

0.020
0.004

2004

0.040
0.010

2005

0.004

2006

(Fiscal year)

Supporting health and safety at affiliated companies
We support suppliers in business areas such astechnology, the environment and health and safety.
We implemented a training course on joint healthand safety, patrols and accident cases, under thenational “Group Health and Safety Assistance Project,”
for two companies doing business with the Iwata Works
in Shizuoka Prefecture.
For physical and mental health
To help each employee manage their own health, NTN
not only promotes regular physical examinations but also
encourages preventive health measures such as early
detection of cancer and appropriate measures forlifestyle-related diseases.
For mental health, we set up counseling areas ateach location where all can consult with a counselor. We
implemented the “MINI diagnostic exam” which candiagnose melancholia, panic disorder or obsession
neurosis. Further we are “noticing” and “listening” in theworkplace, and promoting mental health education.
We assist employees with personal care andeducate managers on mental health.

Interviews by industrial physician started
In order to prevent overworking employees, we monitor
working hours and holidays worked. Those who haveoverworked contrary to the agreement on overtime andworking holidays, are issued a warning when theirworking hours go over the limit.
In 2006, excessive working hours per employee
were 15.3 hours on average, reduced slightly from 16.2
hours in 2005. From March 2007, all whose working
hours exceed 60 hours per month and those whose
working hours exceed 45 hours as proposed bythemselves or their supervisors are interviewed by anindustrial physician.

Communication window for
employees
Evaluation by interview and utilization of help line
A biennial interview with general employees is held to
make an agreement between them and their supervisorson their evaluation and goalsetting for the next term.
Interviews are conducted based on the personnel
performance evaluation manual and by multiple persons
to maintain fair evaluations.
A help line (see p. 19) was established as aninternal and external window for all employees to be able
to report such issues as human rights violations, sexual
harassment and other harassment.

NTN Corporation CSR Report28Responsibility to Shareholders

Fair and Rapid Disclosure of Information to
Enhance Enterprise ValueNTN will strive to timely and properly disclose information and to forge good relations with all of our shareholders andinvestors in order to earn their trust and a fair valuation in the market.

Information disclosures

Shareholder returns

Timely disclosure and enhanced communication
NTN is working to provide our shareholders and investors
with fair, timely and rapid disclosure of information incompliance with relevant rules and regulations.
In investor relations (IR) activities, we are making
efforts to provide our shareholders and investors withperformance results, financial positions, management
strategy, and NTN’s vision for the future as accurately
and clearly as possible. At the same time we are working
to further improve communications with shareholders
and investors by incorporating their feedback into ourmanagement system.
At the annual shareholders’ meeting held on June29, 2006, we gave due consideration to such items as
exhibiting our products and making businesspresentations on panels to create a relaxed atmospherethat makes shareholders feel free to ask questions.
We will further study the annual shareholders’meeting to determine a date that is more convenient for
to attend and to make meeting materials that are easierto understand.

Optimized return to shareholders
NTN considers returning profits to shareholders a principal
management policy. For the medium and long-terms,
NTN’s goal is to provide a steady and sustainabledividend payment, which is determined according to its
consolidated earnings and dividend payout ratio.
The annual cash dividend for the fiscal year ended
March 2007 was ¥16 per share (compared to ¥11 forthe fiscal year ended March 2006).

Communication with shareholders

Communication with investors and analysts
NTN held four conferences with institutional investors
and analysts to explain its performance results in 2006.
In addition, NTN also held “small meetings” and plant
tours separately with certain groups of analysts. For
individual investors’ convenience, we transmit IR
information on the company website as well as in apresentation at an event targeted to individual investors.
SRI FundShareholders’ Meeting

Product-exhibiting Space

Evaluation of firm byexternal organizations
NTN stock is included in SRI funds and SRI indices
NTN is acknowledged to be a company that proactively
lives up to its social responsibilities and is included inwell-known SRI (socially responsible investing) indices.
NTN has also been named a select company by
Morningstar in Japan, and by FTSE4Good and ETHIBEL
overseas.

29

NTN Corporation CSR ReportJapanese Stock SRI Fund (STB Asset Management
Co., Ltd.)A fund investing in “Japanese companies that are
addressing CSR positively”
Family Friendly (Mitsubishi UFJ Asset Management
Co., Ltd.)A fund investing in “companies that offer diversified
and flexible working conditions amenable to career andfamily life”
Asahi Life Social Responsible Investment Fund
“ASUNOHANE” (Asahi Life Asset Management Co., Ltd.)A fund “evaluating companies on the basis of theenvironment, employment, response to customers,social contribution and corporate ethics from thestakeholders’ standpoint”

SRI Indices
MS-SRI (Morningstar Japan K.K.)“The first socially responsible investing index, which
includes 150 companies of excellence listed in Japan”
EFTSE4Good {FTSE International Limited (England:
Joint venture company between the London Stock
Exchange and The Financial Times)}“Evaluate corporations from the standpoints ofenvironmental sustainability, social issues andrelationship with stakeholders”

Responsibility to Local Communities
Report on Social Aspects

Active volunteerism as a Good Corporate Citizen
The NTN Group volunteers for community programs where NTN has operations.
In 2006, NTN held a variety of programs to commemorate its 88th anniversary (see pp. 15-16).

Supporting voluntary activities

Promoting charitable activities
NTN has pledged to “contribute to society” in its corporate
philosophy and CSR policy. The basic policy is that
activities that contribute to society should be participatedin on a voluntary basis, choosing the most appropriate
program out of the many issues faced by society. NTN
sees such participation as an “investment in society.”
In regard to emergency disaster response andfostering the environment and culture, NTN promotes
cooperation with appropriate partners, such as local
communities and non-profit or non-governmentalorganizations to solve public concerns. NTN also
participates in benevolent activities that our industry or
the general business world engage in.
NTN also encourages its employees to participate
in such activities, as taught in the Business Code of
Conduct, such as contributing through work, charitable
activities and support for educational and culturalcauses. NTN supports its employees’ voluntary activities.
NTN participates in a broad range of activities suchas local greening projects, public service projects,
amicable coexistence with local communities, supporting
local education and the support of academics, sports
and culture.

Assuring the safety of thelocal community

In 2006, NTN’s main office in Nishi-ward, Osakajoined the Business Protection Council within thejurisdiction of Nishi Police Station in Osaka prefecture.
Exchanging information regarding issues such as billing
fraud and its countermeasures, NTN cooperates with thepolice to eliminate any type of crime and violence.
As part of a traffic safety campaign, Kuwana Works(Kuwana city, Mie prefecture), had several employees
participate in monitoring drivers on the street once amonth. Okayama Works participated in a similar activity.

Communication with local
communities
Answering questions from the local community
Communication with neighbors is done by eachbusiness location. For example, a complaint was lodged
at Iwata Works in May 2003 by nearby residents about
factory noise during night operations. The Iwata City
Government, which notified Iwata Works of thecomplaint, sent environmental officers to examine thesituation. The investigation showed no legal violation by
Iwata Works, but recommended certain
countermeasures. Iwata Works responded on the same
day by closing the shutters and then quickly installingsound insulation to improve the situation. A series of
NTN responses satisfied the neighbors. NTN takes care
not to cause problems regardless of whether we arelegally required to act.
NTN will continuously work to fulfill its responsibility
as a member of local communities by listening earnestly
to the voices of people in the community.

Crime-prevention and traffic safety activities
NTN and its group companies cooperate with traffic
safety and crime-prevention campaigns to better
communities with improved security and safety.

Annual local summer festival

Sponsoring cross-culturalexperience event (USA)Donation of school supplies toelementary school (Thailand)

Okayama Works
In August 2006, “NTN Okayama
Summer Festival,” now established as
the local’s summer event, was held.
3800 people including NTN
employees and their families, local
residents andguestsenjoyedvarious
events andsnack booths.

NTN DRIVESHAFT, INC. (NDI)
NTN, together with other Japanesecompanies operating in the community,
sponsored and participated in “Ethnic
Exposition 2006” held over two days in
October 2006. Interaction with people
from different
countries waspromoted byintroducing
Japanesefood andculture.

NTN MANUFACTURING (THAILAND) CO., LTD. (NMT)NTN donated elementary schoolsupplies bought with money collectedfrom its employees and unwanted
books. NTN will continue to support thechildren who are willing to learn but are
in a difficult
situation foreconomicreasons.

NTN Corporation CSR Report30Wind Power Generator at Export Center (Kuwana)

Report on Environmental Aspects
Emphasizing conservation of the environment, ourgroup aims to create a sustainable society while
NTN Environmental at Targets toward 2010
defining our environmental targets for 2010.

32

Environmental Management

35

Targets and Results

37

INPUT & OUTPUT

38

Conservation of the
Global Environment

41

Creating a Recycling Society

42

Maintaining and Promoting
the Environmental Management
Structure

Conservationof the global
environment
Maintaining
and promoting
the environmental
management
structure

Creating a
recyclingsociety44

R&D Efforts to Reduce
Environmental Impacts

45

Site Reports

47

Environmental Performance Data

CO2 emissions*

Emission per added value production amount
Domestic: 25% reduction compared tofiscal 1997
Overseas: 4.5% reduction compared tofiscal 2006
Total emissions: 297,000 tons or less /year

Complete phaseout of halon
extinguishers

Paper consumption* Separate targets are set at
new NTN sites that started
operations after fiscal 2003

50% reduction comparedto fiscal 1998

Reduction ofwaste materials
Domestic: Maintain zero emissions
Overseas: Recycling more than 98%

Complete phaseout of Styrofoam

Acquisition of
ISO 14001 certification
at all NTN sites (Global)

Solar light panels at
NTN Kamiina Corporation

31

NTN Corporation CSR Report

Environmental Management
Report on Environmental Aspects

Toward a Harmonious Co-existence with
the Global Environment
The NTN group established our Basic Concept and Action Guideline, aiming at a harmonious co-existence with the global
environment, and we are making every possible effort to fully develop a structure and environmental management
activities in order to realize our objectives.

Basic Concept
Advocating harmony with the global environment is our most important issue and we will make constant efforts tocontribute to the harmonious development of society, while aiming to reduce environmental impacts and create arecycling society.

Action Guideline
In connection with its manufacture and sales of bearings, constant velocity joints and precision equipment, the NTNGroup will comply with the following guidelines, which state our commitment to continuously reduce the impact ofour products and business activities on the environment, and to maintain a safe environment for the future.
1. NTN will contribute to world-wide energy conservation
by developing and providing eco-conscious products
using tribological technologies and high precision
processing technologies.
2. NTN not only will comply with the requirements set forth
in applicable governmental laws and regulations but
also with customers’ requirements and internal
standards, as NTN deems necessary.
3. Beginning at the research, development and design
stage, NTN will endeavor to reduce environmental
impacts.
4. In its purchase of raw materials, parts and equipment,
NTN will take into account protection of theenvironment, preservation of resources and more
efficient use of energy. In its production and sales
activities, NTN will endeavor to reduce energy
consumption and waste generation while promoting
recycling.

Environmental conservation
structure
Environmental Management Committee promotes
activities as a central bodyCreation and maintenance of the best environmental
conservation structure is one of the important social
responsibilities for the corporation.
Our group established the Environmental
Conservation Committee in 1993 in each department at
the Head Office and in the Engineering, Production,
Sales and Logistics Departments. Company-wide
environmental conservation activities started.
In 1998, the committee was renamed theEnvironmental Management Committee. The
management scope was clarified and targets were set
regarding pollution prevention, energy conservation,
environmental conservation, materials management andenvironmental impact reduction in logistics, etc..

5. NTN will endeavor to implement production methods anddistribution systems that have less environmental effectin terms of pollution, waste and use of resources andenergy.
6. NTN will conduct environmental audits and will maintainand improve corporate environmental management
systems.
7. NTN will cooperate in programs for environmental
protection conducted by national and local government
entities and will actively participate in regional
environmental activities.
8. NTN will conduct environmental education. NTN will
promote improved awareness of this Environmental
Policy and environmental protection to all persons
working on behalf of the NTN Group.
April 1, 2007
Osamu Wakisaka
Chief Environmental Management Officer
Senior Managing Director
NTN Corporation

Structure Chart
President
Strategy Meeting

Pollution Prevention
Subcommittee

Environmental
Management Committee

Energy and Natural
Resources Conservation
Subcommittee
Hazardous Substances
Management Subcommittee

Environmental
Management Department

Sales and
Administration Division

Manufacturing DivisionOn-site Environmental
Management
Committee

Logistics Environmental
Subcommittee

Internal
Environmental
Auditing TeamOn-site Environmental
Management
Committee

Internal
Environmental
Auditing Team

Pollution
Prevention
Action Committee

Safety/Environment
Management
Section*

Logistics
Environmental
Action Committee

Product Center
Distribution Center

Energy and Natural
Resources Conservation
Action Committee

Plant

OfficeEnvironmental
Action Committee

Head Office/Branches/Sales
Branches

Hazardous
Substances Action
Committee* At some sites, the Management Section or General

Administration Section is in charge of this operation.

NTN Corporation CSR Report32

Environmental management system

Environmental management structure strengthenedat each global operating site
We have been working to obtain ISO 14001 certification
at every site since fiscal 1996. To efficiently carry out
unified environmental management at all NTN Group
companies, we have obtained multi-site certification for
14 sites: the Head Office, all the production sites and the
R&D division. Eight related companies manufacturing
finished products as well as manufacturers NTN Kinan
Corp. and NTN Tado Corp. also obtained certifications.
Thirteen overseas sites have obtained certifications so far.
In October 2006, a surveillance audit of themulti-site certification was conducted and passed.
Items that were pointed out by the audit had beenchecked at other sites and corrected if necessary.
We will be working to obtain ISO 14001 multi-site
certification by 2010 for all the NTN Group companies
including part processing companies. Based on thispolicy, NTN Kamiina Corp. and NTN Bizen Corp. beganefforts last year to obtain simplified environment
certifications such as “Eco-stage” (see p. 42) as apreliminary step to obtaining ISO 14001.
In fiscal 2007, we will seek ISO 14001 certificationon the following schedule to ensure further improvementof the management structure at global business sites, aswell as transferring NTN Kinan Corp. and NTN Fukuroi
Corp. to the multi-site certification.

Certified operating sites
Operating site
Area

Company Name

Plant Name

Year/Month
Obtained
Year Month

AgencyMulti-site certification obtained collectively 1999
11
JSAE176
JSA(Included sites) Kuwana Works, Iwata Works, Okayama Works, Takarazuka Works,
Nagano Works, NTN Kongo Corp., NTN Mikumo Co., Ltd., NTN Engineering
Japan Plastics Corp., NTN Powder Metal Corp., Hikari Seiki Ind. Co., Ltd., NTN Casting
Corp., NTN Omaezaki Corp., NTN Mie Corp., The Head Office
NTN Tado Corp.
JSA2005
JSAE1058
3

U.S.A.

No.

AgencyNTN-BCA Corp.

2000

7

A8699

UL

NTN Driveshaft, Inc.

1999

12

A8478

UL

Canada NTN Bearing Corp. of Canada, Ltd.

1999

7

287

KPMG

NTN Kugellagerfabrik(Deutschland) G.m.b.H.

Area
U.S.A.

Company Name

Plant Name

Registration

1999

6

201167-2

LRQA

2003

1

19479

AFAQ

LRQA

France NTN Transmissions Europe
Thailand NTN Manufacturing Thailand

2003

3

31634

TÜV

112115LRQA

NTN-NIDEC (Zhejiang) Corp.

2005

1

02005E10013ROL

CNAB

6

111998LRQA

Guangzhuo NTN-Yulon Drivetrain Co., Ltd. 2005

4104043247

TÜV

6111999LRQA

Shanghai NTN Corp.

7

CH05/0489

SGS

NTN Kinan Corp.

2004

10

JSAE947

JSA

Elgin Plant
American NTN
Bearing Mfg. Corp. Schiller Park Plant

2000

6

111994

2000

9

Macomb Plant

2000

Hamilton Plant

2000

NTN-Bower Corp.

Year/Month
Obtained
Year Month

Operating site

Registration
No.

Germany

China

2005

Operating sites expected to be certified
Area
Japan
U.S.A.

Operating site

Year/Month Obtained

Operating site

Year/Month Obtained

Month

Year

Month

NTN Kinan Corp.

2007

10

Thailand NTN-NIDEC (THAILAND) Co., Ltd.

2008

3

NTN Fukuroi Corp.

2007

10

India

NTN MANUFACTURING INDIA PRIVATE LTD

2009

3

NTK Precision Axle Corp.

2008

3

China

Changzhou NTN-Guangyang Corp.

2009

3

Environmental auditing

Conducting internal audits and cross-audits
In addition to ISO 14001 assessments by externalorganizations, we conduct “internal audits” by operatingsites, as well as “cross-audits” done by a separate
operating site.
A cross-audit is an opportunity to learn usefulthings and to improve the environmental management
system as well as to enhance the environmental
awareness of employees. In fiscal 2006, six operatingsites were audited with a single finding concerning noise.
Equipment noise was reduced accordingly. Aninternal audit was conducted at every operating site andthere were no serious findings.

33

Area

Year

NTN Corporation CSR Report

Response to environmental risks
and emergencies
Responding quickly to emergency situations
We have a structure to respond quickly to emergency
situations such as earthquake, fire, explosion and flood.
Such may have serious effects on the environment both
inside and outside the company.
Each operating site complies with the “Emergency
management rules” and the “Pollution prevention
management rules” etc. Instructions for responding toemergency situations involving equipment that may
relate directly or indirectly
to the environment are
prepared. Through thesearrangements and daily
training, negative effects on
the environment can be
minimized.
Training for emergency situation

Results in fiscal 2006
In fiscal 2006, a total of 4,575 million yen was spent onenvironmental equipment and other expenses. This
generated a financial effect of 476 million yen, 100

million yen more than in fiscal 2005. This is mainly due tothe expansion of recycling and energy conservation frominstallation of the grinding swart briquetting machine.
[Accounting standard for environmental accounting:
Applicable period: April 2006 to March 2007
Organizational scope: All operating sites in Japan thatobtained ISO 14001 (multi-site) certification]

Environmental conservation cost
Classification
1) Cost of in-factory facilities(Environmental conservation
cost for limiting environmental
hazards caused by businessactivities)

Unit: Million yen/year

Equipment Investment
Details

AmountAmountPollution prevention costs

139

Global environmental
conservation expenses

135

Energy conservation equipment such as new
inverters (Motor, illumination, air conditioning),
equipment for natural gas

73

Equipment cost and peripherals for changing to
inverters (motor, illumination, air conditioner) andnatural gas

Resource recycling
expenses

61

Grinding swarf briquetting machine,
recycling of waste,equipment to reduce waste

512

Grinding swarf briquetting machine, waste material
recycling/reduction measures, general industrial
waste treatment

05Green procurement (plant base cushioning material)

02713) Management activity expenses

1,077

4) R&D expenses

R&D equipment related to environmental
conservation

126

Maintenance, inspection, and management ofenvironmental equipment (dust collector, particulate
smoke removal device, wastewater treatment equipment)

R&D costs related to environmental conservation
Greening and beautification outside the company

046) Environmental remediation expenses

0142

Grand total

1,412

3,163

(Reference) Grand total for previous year

1,193

3,433

Impact on environmental conservation
Result for fiscal 2006

CO2 emission rate

20.1% reduction compared to fiscal 1997

Reduction of waste

Recycle rate: 98.7%

Reduction in paper purchases

30.9% reduction compared to fiscal 1998

Reduction in Styrofoam purchases

81.0% reduction compared to fiscal 1999

Environmental communications

Internal environmental education
In fiscal 2006, we educated employees at various levels
and in various departments.
1.General explanatory education on environmental issues to
newly hired employees/younger employees (done twice)
2.Education on environmentally hazardous substances to
employees in the R&D and Engineering Departments(done twice)
3. Education on revised contents of internal regulations to persons
in charge of environmental affairs at each operating site
4. Education on environmentally hazardous substances toall employees at domestic production sites as an activityof the Environment Month

We previously provided environmental education
primarily for general employees but will extend sucheducation to executives and managers.

Labor cost for EMS, disclosure of information(advertising, CSR report), greening andbeautification of company grounds)

2,030

5) Social activity expenses

Indicator

Investment Cost
Details

Environmental equipment (dust collector,
particulate smoke removal device,
wastewater treatment equipment)2) Upper stream/down stream expenses

Report on Environmental Aspects

Environmental accounting

Soil remediation

Financial effect of environmental
preservation activities
Items

Unit: Million yen/year

AmountDetails

Profit from sale of valuable
materials by recycling

171

Profit from sale of saleable materials
such as metallic sludge

Deduction of expenses by energy
conservation

143

Cost reduction through energy
conservation (air conditioning, illumination)

Reduction of waste treatment costby resource conservation or recycling

162

Benefit from installing grinding swarf
briquetting machine

Grand total

476(Reference) Grand total for previous year

376

Environmental communication to third parties
In order to publicize NTN’s environmental activities, we
are working aggressively to inform the public throughexpos, advertisements in newspapers and magazines,
cooperation and participation in various events anddisplays at the Head Office and each operating site.
In July 2006, taking an opportunity at the “5thenvironmental forum” organized by Kawachinagano-city,
Osaka-prefecture, the home town of NTN Kongo Corp.,
our booth introduced our environmental activities andproducts. Also, from August, an
exhibit about NTN’s recycling
activities has been exhibited in
the basement of the Head
Office. The exhibit featured thewaste sand and waste slag
discharged during production
process at NTN Casting Corp.
that is used as construction
materials.
Environmental advertisementin the NIKKEI BUSINESS DAILYNTN Corporation CSR Report34

Targets and Results

Promoting Activities to Achieve Targets in Three Areas
In fiscal 2006, we continued our efforts from the previous year by setting targets in three areas: “Conserving the global
environment,” “Creating a recycling society” and “Maintaining and promoting the environmental management structure.”

Results in fiscal 2006 and targets
for fiscal 2007
Targets in three areas and promotion activities
We established environmental targets in the areas of“Conserving the global environment,” “Creating a
recycling society” and “Maintaining and promoting theenvironmental management structure” and are working
toward these goals.
Conserving the global environment
In fiscal 2006, seven items (six domestic, one overseas)from the previous fiscal year, were set as targets.
The target of a 20% reduction in CO2 emissions(per added value production) compared to fiscal 1997 at
all domestic operating sites was achieved by
implementing an energy conservation project at Iwata
Works and other projects. Overseas, eight operatingsites (out of 13) achieved the target of a 2% reduction
compared to the previous fiscal year.
As a result of continuous efforts from the year
2000, chlorine-containing coolant that is used in grindingor pressing operations to manufacture bearings was
replaced with an alternative at Iwata Works, completingthe phase out for the NTN Group.
The fiscal 2006 target for eliminating halon
extinguishers that contain ozone destroying substances
was achieved and we are following the plan toward
complete elimination in 2010.

Environmental results in fiscal 2006
Objective

TargetCO2 emission rate:
20% reduction compared to fiscal 1997

P38

Development of Energy conservation diagnosis(promotion of energy conservation issues for
major Works, extension to other sites)

Renovation work for energy conservation
completed in Iwata.
Same project is under way at other sites.

P38
P39

8 of 13 sites achieved the target of 2%
reduction compared to previous year.

P38

No. of halon extinguishers replacedwith CO2 types:
170 units (364 remaining)

P39

Coolants with chlorine:
totally eliminated

P39

Decontamination at Kuwana (5 of 6 sites
completed)

P39

Kuwana, Iwata, Nagano, Mikumo, Kinan et al.

P40

Promote zero emissions:
Domestic recycle rate*3 98%

Recycle rate in all sites incl. NTN Casting:
98.7%

P41

Promote zero emissions:
Overseas recycle rate 94%

Recycle rate:
92.5%

Reduce CO2 emissions

CO2 reduction rate:
Overseas 2% compared to previous year
No. of halon extinguishers replaced with
CO2 types:
125 units
Prevent air, water andground pollution

Domestic Elimination of coolants with chlorine
Response to Soil Contamination
Countermeasures Law

Participation in regional
Participation in regional green activities (allenvironmental preservation Domestic
the companies)
activities

Reduce waste materials
Createing a recycling
society
Protect resources

Domestic

Paper purchase in weight:
31% reduction compared to 1998

Paper purchase in weight:
30.9% reduction compared to 1998

Styroform:
84% reduction compared to 1999

Reduction of Styroform:
81.0% reduction compared to1999

Respond to EU directives

Maintaining andpromoting theenvironmental
management
structure

Promote green
procurement

Establish and promote green procurement
Domestic policy

Complete response to EU directives.
Replacing hazardous substances even in
non-subject products.
Completed (Environmental management
standards specifying revision/deletion of thegreen policy were also revised)

P43
P42

Responded and complied with customer audit

P43

Promote environmental
management of the
supply chain

Of 281 primary suppliers, 227 obtained
Support suppliers’ acquisition of ISO 14001 etc.
certifications.
Domestic(promote installation of Eco-stage entry version)
13 suppliers obtained Eco-stage entry versions.

P42

Respond to new laws

Domestic

Respond to customer audits

Respond to revised Energy Conservation Law Collecting logistics data for Yes/No(extend to logistics companies)
judgment on specific shippers.

Achieved/promotes
Pending*1 Symbols for evaluation:*2 CO2 emissions (ton/million yen)=CO2 emissions (ton) / Sales of value-added production (million yen)
*3 Recycle rate (%)=(1- Final amount disposed (ton) / Total amount discharged (ton) ) x 100

35

Evaluation*1 Page

CO2 emission rate*2:
20% compared to fiscal 1997
Domestic

Conservation of
the global
environment

ResultNTN Corporation CSR Report* At NTN, a recycling rate of 98% or more is defined as zero emissions.

Maintaining and promoting the environmental
management structure
In fiscal 2006, five targets (all domestic) were establishedbased on efforts in the previous fiscal years. As a resultof our efforts in supporting our business partners to
obtain ISO 14001 or other certifications, 227 of NTN’s
281 main business partners obtained certifications. We

Report on Environmental Aspects

Creating a recycling society
In fiscal 2006, we worked toward achieving four targets(three domestic, one overseas) that were based onefforts in fiscal 2005. As for zero emissions*, the total
recycling rate at all domestic operating sites was
98.7%. This was the first time that all domestic sites(incl. NTN Casting Corp.) achieved a 98% score (zeroemissions). Overseas results, however, were 1.5%
below target.
In fiscal 2007, we will further improve the recycling
rate at NTN Casting Corp. and NTN Mikumo Corp. andaim at 99% recycling rate at every operating site.

supported small companies in particular to obtaincertifications under our planned “Eco-stage entry
version” (see p. 42), and 13 companies obtained
certification.
In fiscal 2007, concrete numeric targets anddeadlines were set based on the results and efforts ofprior years. One new item is to enrich the ISO 14001
multi-site certification structure, and we will work forfurther improvement of overall environmental
management.
In response to the EU’s ELV and RoHS directives(see p. 42), we promoted green procurement. Goingforward, we will also work to reduce hazardous
substances according to our original management
criteria in other applications in addition to electrical,
electronic and automotive applications. Also, to respondto Japan’s Amendment to the Law Regarding the
Rationalization of Energy Use, we will promote energy
conservation for shipping cargo.

Environmental targets in fiscal 2007 and fiscal 2010
Objective

Targets in fiscal 2007

Domestic
Reduce CO2 emissions
Conservation of
the global
environment

CO2 emission rate:
22% reduction compared to fiscal 1997
Reduction of total CO2 emission: 261,000 tons per year
Implementation of energy conservation diagnosis results(Large-scale energy conservation measures at major Workspromoted, horizontal development to overseas plants)
NTN Mie receives NEDO energy conservation diagnosis.
Drastic reduction of air leaks

Prevent air, water andground pollution

Maintaining andpromoting theenvironmental
management
structure——

CO2 emission rate:
Overseas 1% reduction compared to fiscal 2006

CO2 emission rate:
4% reduction from fiscal 2006

No. of halon extinguishers replaced with carbon dioxide
extinguishers:
Domestic 125 units (239 units remaining at the end of fiscal year)

Phase out of all halon extinguishers

Respond to Soil Contamination Countermeasures Law

Creating a recycling
society

Targets in fiscal 2010
CO2 emission rate:
25% reduction compared to fiscal 1997
CO2 total emission: 297,000 tons or less per year

Participation in regional
Participation in regional green activities (through allenvironmental preservation Domestic
companies)
activities
Promote zero emissions:
Domestic achieve recycle rate of 99% (improve recycle rate at
NTN Mikumo and NTN Casting )Reduce waste materials
Promote zero emissions:
Overseas recycle rate of 94% (improve recycle rate inNorth America and NMT)——
Continue zero emissions
Achieve zero emissions:
recycle rate 98%

Paper purchase in weight:
38.5% reduction compared to fiscal 1998

Paper purchase in weight:
50% reduction compared to fiscal 1998

Styroform purchase in price:
85% reduction compared to fiscal 1999

Complete phase out of Styroform purchase

Protect resources

Domestic

ISO 14001 multi-site
Certification

Integrate NTN Fukuroi and NTN Kinan to ISO 14001 multi-site
Domestic Obtain preliminary environmental certifications at
Acquisition of ISO 14001 certification at all sites
NTN Kamiina and NTN Bizen(global)Overseas NNTC and NTK obtain ISO certifications
Promote elimination of hazardous substances in
products not subjected to EU (RoHS, ELV) directives

Promote green
procurement

Domestic

Ensure NTN green procurement standards—

Respond to customer audits
Promote environmental
management of the
supply chain
Respond to new laws

Encourage and support suppliers to obtain ISO 14001
Domestic certifications etc.:
certification acquisition rate 95%
Respond to revised Energy Conservation Law
Domestic (Establishment and implementation of energy
reduction plan as cargo owner)

Acquisition of certification at all suppliers—

NTN Corporation CSR Report36

INPUT & OUTPUT

Grasping the Entire Picture of Environmental Impact
To understand environmental impacts, it is essential to grasp all the effects of business activities on the environment
precisely. NTN is striving to grasp environmental impact over the entire life cycle of products.

Business activities andenvironmental impact
Big reduction in amount of industrial waste despite
increase in production
In fiscal 2006, the total amount of raw material usage(steel and secondary materials) in the whole NTN Groupwas 385,000 tons. Although production increased due tothe pace of NTN’s business expansion, raw material
usage remained almost the same as that of the previous
fiscal year due to resource conservation activities.
Also, the amount of industrial waste disposed was
greatly reduced.

At 13 domestic operation sites

OUTPUT

INPUT
Secondary materials
Steel

Material
recycling20
1002003 2004 2005 2006

(Fiscal year)1
2003 2004 2005 2006

(Fiscal year)

600

Thermalrecycling

400
200
0

2003 2004 2005 2006

(Fiscal year)

CO2 emission
270,000 tons

Waste oil
4,600 tons

2003 2004 2005 2006

100

Use ofcirculating
water
620,000 m3

300

Wastewater (10,000 m3/year)

Water usage

Water(10,000 m3/year)

200

NTN Corporation CSR Report

100

Wastewater
1,980,000 m3(Fiscal year)

20(Fiscal year)300

2003 2004 2005 2006

2003 2004 2005 2006

30

(Fiscal year)

0

37

0

CO2 emission

Water
2,250,000 m3

2

1,000

(10,000 tons CO2/year)

Electricity consumption(GWh/year)

EnergyElectricity
562 GWh

Metallic
waste
32,400
tons

3

0

2,000

Production process

23,900 kL

Purchased amount(crude oil
equivalent)(10,000 kL/year)

Fuel

3,000
Disposal ofindustrial waste
711 tons

30

Disposal (tons/year)

Purchased amountSecondarymaterials
21,000tons

Products

40(10,000 tons/year)

Raw materials

Steel364,000
tons

200

100

0

2003 2004 2005 2006

(Fiscal year)

Conservation of the Global Environment
Report on Environmental Aspects

Important Steps to Address the Preventionof Global Warming
We are promoting the prevention of global warming, emphasizing energy conservation measures at production sites andthe utilization of natural energies.

Reducing greenhouse gases

Ensuring energy conservation measuresat production sites
In Japan, most of the CO2 that causes global warming is
generated by production activities. Accordingly, energy
conservation at production sites is the most effective
measure in reducing CO2 emissions.
NTN is promoting efficient production at every
operating site (domestic and overseas) and is pushingenergy conservation measures such as fuel changeovers
for heat treatment furnaces, integrated operation ofcompressors and air conditioning equipment and use of
inverter lighting equipment. Also, to enhance energy
conservation awareness among employees, we arepromoting even small energy conservation activities suchas switching off unnecessary lighting during rest breaks.
Furthermore, we are aggressively pushing the use ofnatural energies like wind and solar.
In domestic operating sites, we established atarget of “25% reduction of CO2 emissions in 2010 fromfiscal 1997,” nearly double the industry’s target of a 13%
reduction*. The Japan Bearing Industrial Association(JBIA), to which we belong, established that target aspart of the voluntary activity plan of the Japan Economic
Federation.
In fiscal 2006, a target of a 20% reduction
compared to fiscal 1997 at our domestic operating sites
was set and achieved (20.1% reduction). In fiscal 2007,
in addition to the conventional target of CO2 emissions
rate (22% reduction), we will work for a new target: total
CO2 emissions less than 260,000 tons.
On the other hand, in fiscal 2006, overseas
operating sites set a target of a 2% reduction comparedto the previous fiscal year at each site, and eight of 13
sites achieved the target. In fiscal 2007, a target of 1%
reduction compared to fiscal 2006 was set for all
overseas operating sites in seven countries.
* Japan Bearing Industrial Association defines 1997 as the baseline year
since some companies of JBIA had difficulties in obtaining CO2
emission amounts in 1990 (the baseline year of the Kyoto Protocol).

NTN’s CO2 emissions by energy source
Kerosene 4%
City gas 6%

Annual trend of CO2 emission rate
2.0

(10,000 tons/year)

CO2 emissions rate
30

1.0

0.5
0

60

CO2 emissions
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

0

Annual trend of CO2 emissions rate in logistics(kg-CO2/km)

TargetResult0.55

0.50

Annual energy consumption
Electricity
562 GWh
Heavy oil
3,450 kL
Kerosene
3,870 kL
LPG/Butane/
6,660 tons
Gas Propane gas
City gas
7,330,000 m3
OilElectricity 80%

Efforts to conserve energy(Fiscal year)* Excludes entities organized after fiscal 2003.

0.60

CO2 emissions

CO2 emissions rate

1.5

(1,000 tons/Million yen)

Heavy oil 3%

LPG/Butane/
Propane gas
7%

Aggressive use of energy conservation diagnostics
We are aggressively working toward a drastic reductionof CO2 at our whole company. NTN will also receive anenergy conservation diagnosis under a grant fromNEDO (an independent administrative agency-“New energy/National organization of Advanced
Industrial Science and Technology”).
NTN receives information and advice from energy
experts for drastic energy conservation, andrefurbishment of our plants’ equipment is performed asneeded.

1998 1999 2000 2001 2002 2003 2004 2005 2006

(Fiscal year)

NTN Corporation CSR Report38

Refurbishment for energy conservation at
Iwata Works
In autumn of 2006, equipment to utilize waste heat for
power generation was introduced at Iwata Works(Iwata-city, Shizuoka-pref.), NTN’s main plant that
accounts for approx. 30% of our total energy usage.
Warm wastewater is transferred to the adjacent CVJ
plant through the pipe line, then used for heating in
winter via a heat exchanger. By this, a reduction of
approximately
1,600 tons of
CO2 wasaccomplishedin one winterand fuel
expense forkeroseneboilers was
reduced.
Wastewater pipeline and heat exchanger

Aggressive use of wind and solar power generation
We are working aggressively to use natural energy. We
have installed wind and solar power generators when
installing equipment.
As a result of these investments, NTN’s rating
output of natural energy totaled 210kW (Solar: 190kW;Wind 20kW), and the power generation is 243MWh/year.
The reduction in CO2 is 168 tons/year. This is almost thesame reduction as would be obtained by 47ha (the areaof 36 Tokyo Domes) of forest. NTN’s total of 190kW ofsolar power generation is ranked 38th among
approximately 1,000 domestic companies*.
NTN plans to achieve CO2 emissions of less than
297,000 tons in 2010 (emission rate 25% reduction
compared to fiscal 1997). NTN will work to achieve thistarget using an appropriate balance of natural energy
use and energy conservation measures at each plant.
* This is according
to publishedrankings on
accumulated
values bycompanies with arating output ofsolar power, thatwere installedbased on NEDO
“Solar power
generation fieldtest project”(results from 1998
to 2005)
Solar light panels at NTN Fukuroi Corp.

39

NTN Corporation CSR Report

Efforts to prevent air pollution

Eliminating halon extinguishers and coolants
containing chlorine
Halon extinguishers are widely used for fire suppressionof electricity-related equipment, but decompose theozone layer because they contain brominechlorofluorocarbon. For this reason, the NTN groupplanned to entirely eliminate halon extinguishers in 1998
and is working to replace them with alternative
extinguishers. In fiscal 2006, 170 units were replaced
and remaining 364 units are scheduled to be entirely
replaced by 2010.
Also, we set a voluntary target to completely
eliminate coolants containing chlorine used in grinding
and pressing processes in fiscal 2000. As a result of ourefforts, the last equipment was replaced in 2006 with analternative coolant.
Annual trend of number of remaining units ofhalon extinguishers(Units)

2,000

1,500

Target number forremaining units

1,000
Number of remaining units

5000Completeelimination

1999 2000 2001

2002

2003 2004 2005 2006 2010 (Fiscal year)
TargetEfforts to prevent ground pollution

Decontaminating ground pollution at Kuwana Works
In November 2002, at Kuwana Works (Kuwana-city,
Mie-prefecture), slight VOC (volatile organic compound)contamination was discovered in a well. This finding
was not a violation of the Soil Contamination
Countermeasures Law, but we are voluntarily working todecontaminate this site.
As a result of a detailed investigation of the wholearea in Kuwana Works, ground pollution was found at
three locations including the well mentioned.
Decontamination work at two locations has been
completed and the remaining one is almost within theenvironmental regulation specification. We willcontinuously monitor the VOC concentration and workfor complete decontamination.

Cleaning pavements
Head Office (Osaka-city, Osaka-prefecture)
In March 2006, the Environment Management
Committee made a plan to “Clean the pavement on
Yotsubashi-suji Street using corporate volunteers.” On
the 1st day of June during “the month of environment,”
the 1st cleaning activity was conducted for the
pavement surrounding the Head Office.
On that day, participants from each department in
the Head Office conducted the early morning cleaning,such as picking up
cigarettes butts.
Subsequently, thecleaning activity was
conducted at the
beginning of every
month as an activity
for all employees in
Cleaning activity in neighborhood
the Head Office.
of Head Office

Employees promote “satoyama”-recovery greening
activity in neighborhood participation
Iwata Works (Iwata-city, Shizuoka-prefecture)
All employees at Iwata Works are working on an“all-employee district greening project.”
In five years, 2,200 azalea trees were planted on“satoyama” (semi-natural areas located adjacent topopulated areas that were traditionally cared for andutilized by local residents) in the neighborhood andbenches made from the thinned woods were installed.
Also, we are continuing to work with the local people forthe beautification and cleaning of the mountains in theneighborhood (for example, by cutting the grass
periodically). In 2007, it was named “Interaction
Common” and a 1.4ha wide common intersecting withnature has come into being.
Also, the Shizuoka Greening Promotion Association
presented a certificate of appreciation to Iwata Works asa large donor. Fiscal
2007 will be the 6thyear for theemployees’
participation in“Green Fund Raising”
to make a donation
for planting expenses
Grasscutting at a neighborhood mountainand similar causes.

Report on Environmental Aspects

Participating in environmental
conservation activities

Teaming with local government for forest
improvement project
Nagano Works (Kamiina-gun, Nagano-prefecture)
Nagano Works is supporting a program of “Forest
sponsorship,” in which cities, towns, villages andcompanies work together for the recovery of a forest.
The Works supports the improvement of a forest(approx. 20ha),
coordinating with
Komagane-city.In
May 2006, 60
employees
participated in thegrasscutting work.
We will continue
to cooperate in theforest recovery andthrough the forestry
experience become
friendly to forests andopen space and learn
the value of thenatural environment.
Grasscutting work
Planting activity in the park
NTN Mikumo Corporation(Matsuzaka-city, Mie-prefecture)
In March 2006, as part of a local greening activity,
employees of NTN Mikumo Corp. and their families
planted about 60 trees at the Matsuzaka ChubudaiPark. A letter ofappreciation waspresented to ourcompany from
Matsuzaka-city.
We will
continue to donate
trees every year.

Commemorative picture after planting

Initial planting in the forest
NTN Kinan Corporation(Nishimuro-gun, Wakayama-prefecture)
NTN Kinan Corp. stated its plan to plant 2,000 broadleaf
trees in a 1 ha forest named “Nagomi-no-mori(Harmonious forest)” over the next 10 years.
This is part of the “Corporate forest” project
promoted by the local government and we are working
together with the “green thumb team” organized by
local children andlocal people.
In February
2007, a planting wasorganized and over
100 employees, theirchildren and local
persons planted trees.

Planting young trees

NTN Corporation CSR Report40Creating a Recycling Society

Creating a Recycling Society
For the effective use of limited resources, we are emphasizing “Improving the recycling rate” and “Reducing usage ofcontainer packaging,” and are producing steady results.

Our operating sites are using the new machines tofurther improve the recycling rate. Both Kuwana andOkayama Works already installed two machines, and NTN
Mie Corp. and NTN Kamiina Corp. one machine each.

Activities in fiscal 2006

Toward Zero emissions
The NTN group is aiming at zero emissions for the wholegroup. One large obstacle was that there was norecycling method for waste sand and slag produced
during the casting process at NTN Casting Corp.
In fiscal 2006, NTN Casting Corp. together with thelocal Tatenui Construction Cooperative Union developed
an effective method to use waste sand and slag as
paving material for roads, and increased the recycling
rate to 85.0% (the previous fiscal year was 67.5%). As aresult of that success, the overall recycling rate for the
NTN group became 98.7% and the goal of zero
emissions was achieved. For fiscal 2007, we increased
the target to 99% and are working to increase recycling.
Annual trend of recycling rate and final dispositionat the whole NTN Group
120

(%)

(Tons/year)

Recycling rate

100

5,000
4,000

Final disposition

60

3,000

40

2,000

20

1,000

0

2001

2002

2003

2004

2005

0
2006 (Fiscal year)* Including data of NTN Casting from fiscal 2004 (because of addition to
ISO 14000 multi-site certification)

Promoting NTN use of new briquetting equipment
We developed a grinding swarf briquetting machine tore-use metallic waste (grinding sludge) mixed with grinding
coolant that is generated in the
bearing manufacturing process.
We gained favorable reviews
with the machine from both
inside and outside thecompany. In the last fiscal year,
a new high-performancemachine with better capabilities
was developed and we begansales inside and outside the
New grinding swarf briquetting
machine (NTN Kamiina Corp.)
company.

41

NTN Corporation CSR Report* U.S. gallon=3.8 litters

Reducing packaging material usage

6,000

Final disposition

Recycling rate

80

Separation of waste oil and wastewater
recycles resources
NTN DRIVESHAFT, INC. (NDI) was generating 814,000
U.S. gallons* per year (2005 results) of waste oil andwastewater in its manufacturing processes in the past,and relying on certified industrial waste disposers. The
introduction of a new wastewater treatment systemallowed NDI to separate the oil and water.
As a result, a 49% (399,000 U.S. gallons)
reduction of waste oil and wastewater was achieved andtreatment costs also decreased. The separated waterand oil are re-used within the company and it helps
conserve resources.

Improvement of container collection rate
In fiscal 2006, with wooden pallets, steel box pallets orplastic containers for transportation and storage of
products, we worked to improve the collection rates
and to curb new purchases by managing the quantities
shipped to customers. As for shipping external packing
boxes for overseas plants, cardboard packaging waschanged to a returnable steel box.
By this change, the collection rate of pallets andplastic boxes was improved from 92% in the previous
year to 95%. Aiming at a 100% collection rate, we will
strengthen the management structure at distribution
sites and manufacturing plants, as well as ask logistics
companies for their cooperation.

Cardboard packaging

Steel returnable box

Maintaining and Promoting the Environmental Management Structure
Report on Environmental Aspects

Creating an Environmental Management Structure
for the Entire Supply Chain
As part of a manufacturer’s social responsibility, we are creating an environmental management structure andstrengthening the management of environmentally hazardous substances for not only NTN, but also for the entire
supply chain.

Supporting supplier certifications

Expanding environmental management systems tosmall companies
To expand the circle of environmental management
systems to suppliers, we are requesting our main
suppliers to obtain environmental management system(EMS) certifications of ISO 14001 and “Eco-stage”*1 formedium sized companies, and providing them withsupport to acquire the certification.
As part of our efforts, we planned and suggested“Eco-stage entry version”*2 that is an abridged versionof Eco-stage for small companies, and since 2005, wehave supported the certification process. In the entry
version, minimum requirements for environmental
management are defined as a primary purpose and thecost to obtain the certification is less than theconventional certification. In fiscal 2006, former NTN
employees supervised suppliers with less than 15
employees to establish appropriate targets for improving
defect rates and other management aspects. As a result,
13 companies obtained the Eco-stage entry certification
through March 2007.
And 227 of 281 suppliers (81%) have obtained theenvironmental management certifications of ISO 14001.
We requested the remaining suppliers to work
aggressively and are encouraging all the suppliers to
obtain certification by the end of fiscal 2008. We
established asystem to present
environmental
awards to suppliers
who workaggressively toobtain thecertification andachieve remarkable
Assisting company to obtain Eco-stage
results.

“Green Procurement”

Management of environmentallyhazardous substances
We are making efforts to produce products that do not
negatively impact the environment. All procured parts andmaterials for production are subjected to our Green
Procurement program. Suppliers’ cooperation is essential
for Green Procurement and we are striving to involve theentire supply chain management, from initial sources up
to material makers. Also, we are promoting our purchasesystem, paying attention to the environment, andsupervising initial sources since many of our initialsources are small and medium sized companies.
To respond to the regulations on environmentallyhazardous substances of the E.U. ELV directive (End ofLife Vehicles Directive) *1, RoHS directives (Electrical andElectronic Directive) *2 and customers’ green
procurement criteria, we conducted explanatory
meetings for suppliers and requested a reduction ofenvironmental impacts at the stage of material
procurement and the stage of production. Also, werequested suppliers to conduct internal environmental
audits and when necessary, we visited them to verify the
results of the audit and to supervise.
In November 2006, we established an internal
engineering standard of “Limited use of environmentallyhazardous substances for raw materials and parts.” In
the standard, NTN’s criteria on hazardous substancesand description methods on drawings are specified.
*1 ELV (End of Life Vehicles) directives: Substances subject to regulation

are mercury, cadmium and hexavalent chromium. Enacted in July
2003. (Only hexavalent chromium for rustproof surface finishing wasprohibited from July 2007)*2 RoHS (Restriction of the use of certain Hazardous Substances inelectrical and electronic equipment) directive: Substances subjected toregulation are polybrominated biphenyls and polybrominated diphenyl
ether in addition to the substances of the ELV directive. Enacted inJuly 2006.

entry certification*1 Environmental management system of Eco-stage association:
Mid-sized, limited liability company*2 We presented to the Eco-stage association the concept of a cheaper,
secondary certification for companies with less than 15 employees. It
was adopted as a trial level of EMS certification.

NTN Corporation CSR Report42Response to hazardous
substances regulation
Response completed prior to the effective date
NTN has completed its response to the ELV directive forvehicles and the RoHS directive for electrical andelectronic equipment on environmentally hazardous
substances prior to the effective date of those directives.
However there are still some products not yet inaccordance with some customer-specific requirements.
We will approach these customers and promote theswitch to other products under the ideals of CSR andeliminating corporate risk.

Revision of environmentallyhazardous substancesmanagement standards

Environmental audit

Customers’ audits
NTN is actively responding to customers’ audits
concerning hazardous substances. In fiscal 2006, wewere audited by three customers. We received highappraisals for items such as NTN’s “System for review atthe development stage” and “Hazardous substances
avoidance based on analysis” among other items.
NTN Powder Metal Corporation, for example, wasaudited in March 2007 by Panasonic Communications
Co,. Ltd. and received a 96.5% conformity rate (an “A”
ranking).
Utilizing such results, we will work for further
improvement in our management of environmentallyhazardous substances.

Review and enhancement of the entire hazardous
substances management structure
We established “Environmentally hazardous substancesmanagement standards” in 1998 to properly manage
such substances. Due to increasing demands from
customers regarding hazardous substances, ourstandards were reviewed entirely.
The following are the main points of the revision.
1. Addition of new concepts required for environmentallyhazardous substances management.
The same treatment shall be used regarding
substances applied to sub-materials (rinsing oil,preservatives etc.) in production that are not specified
on drawings.
2. Clear descriptions of customer requirements, including:Establish a new provision on “Education and Training
on Hazardous Substances Management”
Establish a new provision of “Management ofSuppliers”

In the meantime, the Environmentally Hazardous
Substances Management Manual (a part of the above)that defines actual operations, was also revised.

43

NTN Corporation CSR Report

Customer audit at NTN Powder Metal Corporation

R&D Efforts to Reduce Environmental Impact
Report on Environmental Aspects

Research and Development Directly Benefiting
Environmental Conservation
Bearings and CVJs are “Eco products” that decrease energy loss due to friction. We are working on technologicaldevelopments to contribute to further energy conservation by improving the performance of our products used in various
equipment worldwide.

Products responding to
the environment
Research and Development focusing on reducing
environmental impact
We are working for R&D with main products of bearings,
CVJs and others, focusing on long life, light weight, lowfriction and high efficiency that directly contribute toconserving the environment.
We are also aggressively working on the recyclingof industrial waste, such as grinding swarf briquetting
equipment and steel dust briquetting equipment.
Most of our R&D expense in fiscal 2006 was spent
on long life, light weight, low torque and high efficiency
themes that contribute directly to energy conservation.

[ Main R&D results ]Long life: Long life tapered roller bearing-steel fatigue
life is extended by a special heat treatment refining the
crystalline structure.
Weight reduction of main products: Ultra-lightweight
hub bearing for small cars.
Low friction: Ultra-low torque tapered roller bearing-rotational torque was remarkably reduced by low
friction that resulted from improvements in the bearing
cage pocket (hole) enhancing oil lubrication.
High efficiency: EBJ and EUJ series CVJ-torquetransmission efficiency was improved by means ofincreasing the number of balls from six pieces to eight.

Railroad Journal Bearing Unit with longer maintenance intervals
Bearing demand in railroad applications isincreasing substantially in China where the railroad
network is expanding in response to economic
growth; and in the EC market where higher-speed
railroad networks are being promoted along with
European integration. These bearings are key
control components that directly affect safe runningand require high reliability. Also, for cost reduction,
extending maintenance intervals has been an
important issue.
NTN has developed a new “high speed
bearing unit” that allows a doubling of themaintenance period to 1.2 million km run (from theconventional 450,000-600,000 km) by using newtechnologies, including a plastic specialized cage, aspacer with rubber lip and a new configuration
seal. Recently, this bearing was adopted in the
Chinese market.
Railroads have been viewed in a favorable lightas mass transportation vehicles that consume low
energy and are environmentally friendly. We
contribute bearings as a key component to railroads
that have less environmental impact by balancing
safety and economy.

New high-speed railroad journal bearing unit

NTN Corporation CSR Report44Site Reports (Comments from environmental managers)

Environmental managers talk about each department’s efforts on the environment. At this time, we introduce the Environmental Management Department (Head Office) that set the new environmental targets along with the new medium-term
management plan; NTN Fukuroi Corporation, a new addition to the NTN Group; NTN MANUFACTURNG (THAILAND) Co., LTD(NMT), which has received good appraisals on their environmental efforts; and NTN DRIVESHAFT, INC. (NDI), which
achieved remarkable results from recycling efforts.

Head Office (Osaka-city, Osaka-prefecture)
In 2010, you will see an environmentally-advanced NTN.
environmental education, and(f) Development of local greening activities.
These efforts are targeted towards the
Kyoto Protocol, improvement of theenvironmental management structure,strengthening the management of
hazardous substances and improvementof NTN’ s environmental reputation.

Toyoko Saka
Environmental
Management Department

What kinds of efforts are being
made to promote environmental
activities at overseas sites?

NTN disclosed its new medium
term management plan. Whatkind of plans were included forthe environment?

We will increase opportunities forexchanging information as well as
aggressively introduce energy
conservation technologies / recycling
technologies from Japan. For doing this,
we think it is important to improve the level ofstaff in charge through periodic interactions
with overseas plants.

The emphasized issues for the next three
years are (a) Reduction of CO2,(b) Achievement and continuation of arecycling rate of 99% or more,(c) Acquisition of ISO certifications at all
NTN operating sites in Japan andoverseas, (d) Improvement of hazardous
substances management (including the
supply chain), (e) Improvement of internal

What actions are taken towards
suppliers?
We will ask all the suppliers to acquire
environmental certification. We will support

suppliers to obtain certification, andpropose that all suppliers obtaincertification by the end of fiscal 2008.

What will the status of the entire
NTN Group look like in 2010?
We have clear concrete numeric targets for2010. For example, in plants, 25%
reduction of CO2 emissions compared tofiscal 1997 and total emissions of 297,000
tons or less per year, in logistics, 12%
reduction of CO2 emissions per kilometercompared to fiscal 1998, and at alloverseas operating sites, 4.5% reduction of
CO2 emissions compared to fiscal 2006.
Zero emissions will be achieved not only inJapan but also overseas, and the Green
Procurement structure will be further
improved.
Through these efforts, NTN’s brandimage will be established as “anenvironmentally advanced company.” Also,
we would like to establish our position as acompany that emphasizes social
contributions, through greening activities.

NTN Fukuroi Corporation (Fukuroi-city, Shizuoka-prefecture)
Aiming to be the world’s No.1 CVJ plant, while improving the environmental awareness of every employee.
friendly plant, adopting a state-of-the-art
technology of “hardened steel turning” thateliminates the grinding process and uses
no oil. It also utilizes the natural energy ofwind power and solar power.

Tomomi Sugaya
Administration Department

What is the role of NTN Fukuroi
Corporation in the NTN Group?
Our operation started in 2006 as one ofmembers of the NTN Group, which isaiming to be a top global maker of
constant velocity joints (CVJs). We are the
3rd CVJ plant in Japan and supply partsfor CVJs to Iwata, Okayama and overseas
CVJ plants. We aim to become theworld’s No.1 CVJ plant in all aspects-productivity, quality and delivery.
Also, we are an environmentally45

NTN Corporation CSR Report

What affects the environment inproduction processes?
There is waste cooling water that is
generated by the heat treatment process
and noise that is caused by the production
equipment (although at a very low level).
For this reason, we periodically check
environmental measurements and ensure
the proper monitoring and management ofrelevant equipment.

In fiscal 2007, NTN Fukuroi Corp.
will be integrated into the ISO
multi-site certification. What kindsof issues do you have on thismatter?
Improving the environmental awareness of
employees is the 1st issue, because ourplant is quite new and there are many
inexperienced employees. Therefore ourenvironmental management committee
and the environmental staff will conduct
environmental training. We are trying to
improve environmental awareness among
all employees by displaying NTN’s
environmental policy andenvironment-related posters, and bysaving electricity and segregated waste
collection.

What are the new targets andambitions for the future?
We would like to expand our activities not
only in our work site but also by individuals
or in homes toward preventing global
warming. Also we are thinking ofenvironmental conservation, such as
through greening activities.

Report on Environmental Aspects

NMT (Thailand)
Certified as an excellent plant by the Thai Industrial Ministry and improved environmental awareness of employees.
persons who failed the test were re-trained
to improve their environmental awareness.

It is said that NMT was highly
evaluated by the Thai
environment authority. Whatefforts were focused on theenvironment in 2006?

Anan Kunthataworn
Administrative General Manager

What has been done to improvethe environmental awareness of
employees?
In fiscal 2006, a company training course-an essential item in the 2004 edition of
ISO 14001 -was developed. All
employees attended both an orientationand company training to improve theirawareness on waste management,
wastewater management, energy
conservation and air pollution
management. After the training, acomprehensive test was conducted andPrograms were implemented to improve
employee comprehension concerning two
environmental targets: “5% reduction inelectricity consumption” and “3% reduction
in waste disposal expense.” Also, projects
based on 5S activities and fringe-benefit
concepts were implemented.
As a result of these efforts, in May 2006,
NMT was certified as one of “999 excellent
companies” by the Thai Industrial Ministry
and the environmental awareness of
employees was enhanced. All employees
became proud of their plant and working
environment. It is believed that these results
greatly influenced the continuation of 5S
activities and the improvement of working
conditions and additional fringe-benefits.

It is said that the Thai investmentcommittee (BOI)* will encourage
corporate investment in pollution
prevention measures in fiscal
2007. What activities does NMT
plan for that?
MNT thinks the “grinding swarf briquetter”
developed by NTN Japan will be an
investment in pollution prevention. We will
improve our recycling rate with thisequipment and start selling the briquettes
to steelmakers and recycling companies.
We believe this advanced equipment willfurther the zero emissions goal at NMT.
* Thai investment committee (BOI): Thaigovernmental organization for promoting
investment established in 1977. Broad
incentives and protections are provided toinvestment projects that meet with national
economic developments, such as: “Enhancing
technology in Thai industry” and “Reducing
environmental problems.”

NDI (U.S.A.)
Continuing energy conservation and recycling activities. Improving the results.

Bill Miller
Environment, Health and Safety Supervisor

NDI implemented an environmental
management system in December
1999. What kinds of environmental
improvements have been achieved?
NDI reduced power consumption, wastematerials and wastewater. In fact, we have
twice received the Indiana state“Governor’s Award for Environmental
Excellence” for our improved recycling rate.

What was your environmental
focus in fiscal 2006?

Our efforts were focused on four
important issues:
1) Reduction of power consumption
Target: 2% reduction of power
consumption per joint comparedto the previous fiscal year.
Result: Achieved 4.3% reduction byenergy conservation measures
such as changeover to highefficiency electric motors andenergy saving lights. CO2
emissions reduced 1,800 tons.
2) Recycling of grinding swarf
Target: Continue 100% recycling ofgrinding swarf.
Result: 160 tons (100%) of grinding swarf
were recycled by effective
maintenance of filtering equipment
for grinding coolant (We also received$9,300 from selling the material).
3) Reduction of wastewater
Target: 300,000 gallon (1,140 kL)
reduction in wastewater that istreated by external companies.

Result: 400,000 gallon reduction in
wastewater by expanding oil /water separation, using awastewater treatment plant($76,000 reduction in wastewater
treatment cost).
4) Promoting recycling activities
Target: 100% recycling of office paper,
aluminum cans etc.
Result: Collection containers were installedat appropriate locations, andcollection was endorsed by
employees. Achieved 98.1%
recycling rate.

Where will you focus your future
efforts?
We are aiming at continuous reductions ofenergy consumption and CO2 emissions,
expanding recycling activities and acontinuous reduction of air pollution.
Also, we are making efforts to educate
every employee to be aware of energy
conservation and air pollution prevention.

NTN Corporation CSR Report46

Environmental Performance Data
Collection period: Grand total for April 2006 to March 2007
Number of sites: 13 domestic operating sites

Energy
Oil
(kL)

Gas
(Ton)

Electricity(1,000 kWh)

CO2 emissions(Ton)

Natural energy generation(kWh)

Kuwana Works
Iwata WorksOkayama Works
Takarazuka Works
Nagano Works

2,332
938
1,958
334
40

1,078
1,492
4,035
1,606
265

98,800186,000
122,800
21,60021,80047,20077,90064,00014,4009,200

61,10011,500-NTN Kongo Corp.
NTN Engineering Plastic Corp.
NTN Powder Metal Corp.
NTN Mikumo Co., Ltd.
NTN Casting Corp.
Hikari Seiki Industry Co., Ltd.
NTN Omaezaki Corp.
NTN Mie Corp.

31
75
1
56
1,744
98
15
13

454
6
206
3
145
0
0
2,133

32,200
5,100
6,400
16,10015,7003,300
3,700
28,70013,800
2,200
3,100
6,300
11,1001,500
1,500
18,00058,400Waste materials
Total waste emissions(Ton)

Final disposition(Ton)

Recycling rate(%)

Kuwana Works
Iwata WorksOkayama Works
Takarazuka Works
Nagano Works

7,320
22,13011,600
1,870
810

49
85
42
6
0

99.3
99.6
99.6
99.7
100

NTN Kongo Corp.
NTN Engineering Plastic Corp.
NTN Powder Metal Corp.
NTN Mikumo Co., Ltd.
NTN Casting Corp.
Hikari Seiki Industry Co., Ltd.
NTN Omaezaki Corp.
NTN Mie Corp.

1,890
230
90
1,170
3,350
1,770
1,000
720

6
0
0
13
503
0
2
5

99.7
100
100
98.9
85.0
100
99.8
99.4

Air and water quality
Air emissions
Kuwana Works
Iwata WorksOkayama Works
Takarazuka Works
Nagano WorksNTN Kongo Corp.
NTN Engineering Plastic Corp.
NTN Powder Metal Corp.
NTN Mikumo Co., Ltd.
NTN Casting Corp.
Hikari Seiki Industry Co., Ltd.
NTN Omaezaki Corp.
NTN Mie Corp.

Discharged water quality

SOx (K value)
2
1
<0.02
<0.01
<1

NOx (ppm)
55
408
95
14
28

BOD (mg/l)
8
10
6
<1
2

COD (mg/l)
10
18
12
1
13

<0.01
0.15
<6
0.16

142
43
60

5
2
23
7
180
88
4

12
32
13
5
29
5

* Air emissions is a Max value when there is more than one machine at a site.
* This means that there is no subject machine at a site.

47

NTN Corporation CSR ReportThird Party Opinions
Third party opinion on the CSR report of
NTN Corporation
This report explains simply how NTN’s products arecontributing to society. NTN is a corporation thatdevelops and manufactures and is not often in the viewof the general public. Their environmental and social
efforts are reported faithfully. Thus this report has a very
favorable impression.
This is an excellent report since the special topicsof this report convey the clear message that NTN iscontributing, to the creation of a sustainable society. As
its main business, NTN is utilizing its strengths todevelop and supply long-life and energy-conserving
bearings to various industries that are working on
environmental measures (such as preventing global
warming). The general public may discover that
products made by NTN are used in windmills thatpeople happen to see and in cars that people ride inwithout much thought. The report will be useful todevelop the capability required in this age to “extend
one’s thoughts and ideas to unseen things.”
It is excellent that NTN is supporting small-sizedcompanies to obtain environmental certificates because
many of their business partners are small and medium
sized companies. The reports from environmental
managers, who introduce situations at operating sites,
are also favorable. As seen in the special topics
section, eco-products for many industries are greatly
reducing the environmental impact on society. If NTN
reported on the percentage of eco-product sales
relative to the total sales, how the company thinks of its
present status, and what NTN will do going forward inaddition to the R&D expense, the CSR report would be
more effective.
I will make additional comments below for further
improvement.
With global warming being an urgent global
issue, promoting various activities and reducing CO2
emission are appreciated. However, global warming is
impelled not just by the emission rate, but by total
emissions. Think one step deeper about how anincreased impact from your company affects thephysical condition of the earth, and set a target for
total emissions.
Also, for an indirect effect on your company, makea firm road map to where NTN will be in 10, 30 and 50
years as an environmentally advanced company.
In social aspects, reports of your ideas and thepresent status of human rights issues in less-developed
countries are required. Also, although the rates ofwomen employees and women managers are reported
to be low, make clear NTN’s concrete policy, numerictargets and action programs to actually support the idea

Junko Edahirothat “we would like to increase opportunities for
women’s performance.”
As a CSR report, not many descriptions of financial
aspects are found. From the viewpoint of contribution to
the local economy and the creation and distribution ofassets (particularly distribution to the underprivileged), a
CSR report should contain financial information different
from a standard financial report.
This kind of CSR report must be arranged in a
“PDCA” format: Check Status Plan Do Check
Status and Reporting. In this report, there is a
description of “Reflecting the interests of stakeholders in
the next activities.” Explanation of the actual system fordoing this is required.
Various good activities have been developed and
NTN clearly perceives that a relationship withstakeholders is important. It is expected that using thisreport as a stepping stone, your company will progress
toward “constructive, two-way communication” byhaving bidirectional communication in its real sense
above and beyond the stages of “one-way
communication,” “tour opportunities” and “listening toopinions”

Junko Edahiro
Environment journalist, Interpreter, Chairperson of Change
Agent Ltd., Representative of Ease Ltd., Cooperative
representative of the NGO, Japan for Sustainability (JFS)
Finished Master’s Course of Educational Psychology at
Graduate Course, Tokyo University. She studies systems ofaction modification and its extension, extending the wave of“Communication and continuity” through lectures, writing andinterpretation. For individuals, she teaches courses on“Thinking of personal growth in a systematic way,” “Draw yourown vision and apply your own management system” andcorrespondence courses of “Next stage” to enhance“Communication capabilities.” She holds training courses insystematic thinking for educational bodies. She also provides
facilitation consulting that provides skills for innovative changes
in systematic thinking and to create a “Learning organization”
for companies and organizations.

NTN Corporation CSR Report48For further information about this CSR report, contact:

Corporate Social Responsibility Department
Environmental Management Department
1-3-17 Kyomachibori, Nishi-ku, Osaka, 550-0003 Japan
Tel: 81-6-6449-3561
Fax: 81-6-6449-1578
E-mail: csr_report@osa.ntn.co.jp