NGK SPARK PLUG GroupCSR Report 2015
CSR Report <Digest Version>
sion>Our Main Products

1 Igniter PlugC
Contributing
tossafe and reliableable
flflight in harshh
eenvironmentss

1

6
4

5

Exhibiting
Visible Effects
in Unseen Places
Even though many of our products are small,they actually make a big contribution to yourlife, society and the environment.

4 Ceramic Inserts

2
3

Contributing to high quality
manufacturing throughwear resistant cutting tools

5 Zirconia Exhaust Gas Oxygen Sensor
C
Contributing
to cleaner
er exhaustggas as a key component
ent
in air-fuel ratio controll

1

CSR Report 2015 Digest Version

CONTENTS
2 Crystal Device/

SAW Filter Package

Contributing to miniaturization
and weight reduction of
telecommunications devices withachievement of super compact
and thin ceramic packages

1 Our Main Products
3 Our Business Activities
5 Message from the President
7 Our CSR
9 Special Feature

9 Renovating NGK SPARK PLUG

Providing new value to people
worldwide through new products
and new businesses

11 Renovating NGK SPARK PLUG

3 Iridium Plug
Contributing to low fuelconsumption through outstanding
andi
ignitability and ddurabilityy

Introducing CSR activitiesin Thailand
13 CSR Promotion Activities Targets
15 Responsibilities and Actionsfor Stakeholders
With Our Customers
15
With Our Shareholders and Investors
17
With Our Suppliers
18
With Our Employees
19With Local Communities and International Society
23

25 Responsibilities and Actions
to Environment25

For Environmental Protection

29 Management

29 Corporate Governance/Compliance
30 Risk Management

Content of Business Area

6 Bone Filling Materials

Automotive
Components

Technical Ceramics(Bio Ceramics)

Contributing to recovery from bone
fractures and bone loss on the frontlineof advanced medical treatment· Plugs· Sensors

Ceramics· Semiconductor
packages/
substrates· Cutting tools· Fine ceramics

Editorial Policy
The CSR Report 2015 is edited with the intention of
informing all of our various stakeholders about the CSR
activities of the NGK SPARK PLUG Group.
Please refer to the Company’s website for detailed
information.
http://www.ngkntk.co.jp/english/csr/

NGK SPARK PLUG Group2

Our Business Activities

Contributing to Local Communities
and the Environment Right
Across the World
Asia, South America, Other
Consolidated subsidiaries ····· 17
Unconsolidated subsidiaries ····· 1
Equity method affiliates ····· 1
Non-equity method
affiliates ····· 3

EuropeConsolidated subsidiaries ····· 4

Net Sales by Segment
Other 1%

Percentage of Sales Outside Japan
Automotive
Components
84%

Technical
Ceramics
15%

347,636

Other 13%

Asia 19%

Europe 26%

CSR Report 2015 Digest Version

North
America
26%

347,636(million yen)(million yen)

3

In Japan 16%
Japan 16%

Outside
Japan

84

%

Net Sales

Net Income
Consolidated

Non-consolidated(million yen)

347,636

Non-consolidated(million yen)329,758
302,798
269,232 284,746
266,468 278,166
280,000
231,123 224,811 220,328
210,000

35,000140,000

14,00070,0007,000

350,000

0

2010

2011

2012

2014

2013

28,00021,00025,524
23,68024,475

21,3480Consolidated

36,75332,704
31,791
31,04920,90915,737

2010

2011

2012

2013

(fiscal year)

2014(fiscal year)

Japan
Consolidated subsidiaries ····· 9
Unconsolidated subsidiaries ····· 1
Equity method affiliates ····· 2
Non-equity method affiliates ····· 1North America
Consolidated
subsidiaries ····· 4

Manufacturing & Sales
Organization
Sales Organization
Other

Corporate Outline (as of March 31, 2015)

No. of Employees
Non-consolidated(People)No. of Group
employees:

15,00012,00012,563

12,76013,197

9,000
6,000

5,881

5,809

Consolidated

5,823

3,000
0

2012

2013

2014 (fiscal year)

Company name:
Headquarters:
Establishment:
Capital:Business:

NGK SPARK PLUG CO., LTD.
14-18, Takatsuji-cho, Mizuho-ku, Nagoya
October 26, 1936
47,869 million yen
1. Manufacturing and selling spark
plugs and related products forinternal-combustion engines
2. Manufacturing and selling technicalceramics and applicable productsGroup companies: 36 subsidiaries (ten in Japan and 26
outside Japan) and seven affiliates

NGK SPARK PLUG Group4

Message from the President

Fulfilling NITTOKU SHINKARON
Initiatives Under the 2nd SHINKA (Renovating)
Shinichi Odo

President & Chief Executive Officer
NGK SPARK PLUG CO., LTD.

NITTOKU SHINKARON (The Evolution of NGK SPARK PLUG)
In fiscal 2010, the NGK SPARK PLUG Group formulated a long-term management plan called
NITTOKU SHINKARON (The Evolution of NGK SPARK PLUG), which sets out the vision for NGKSPARK PLUG in 2020. Under this plan, our goal is to become a distinguished manufacturing
company, a highly profitable company, a progressive company, and a personnel “assets” company.
Having achieved these goals, we will deliver real value to stakeholders around the world.
The Evolution of NGK SPARK PLUG has been broken down into three separate three-yearstages called the 1st SHINKA (Delving), 2nd SHINKA (Renovating), and 3rd SHINKA (Evolving).
In the Delving stage that lasted until fiscal 2012 we focused efforts on changing the foundationof the company, or our organizational structure and culture, as well as adopted the corporate officer
system and formulated new human resources systems.
For the three-year period of the 2nd SHINKA (Renovating) launched in fiscal 2013 we haveadopted a basic policy to fully leverage our management resources to tackle bold challenges in new
business domains and fields, with the aim of evolving to the final stage of the long-term management
plan. Using the foundation constructed during the three years of the 1st SHINKA (Delving), we now
accelerate decision making and execution as well as work on launching new products.

Overview of Long-Term Management Plan NITTOKU SHINKARON

NGKexisting
SPARK business
PLUG

5

1st SHINKA
Delving

2nd SHINKA
Renovating

FY2010 to 2012

FY2013 to 2015

Delve into existing
business and seek
new business

Launch new
products or new
business

CSR Report 2015 Digest Version

3rd SHINKA Real
Evolving ValueFY2016 to 2018

Develop existingand new businessat an accelerated rateNGK
SPARK PLUG
in 10 years• A distinguishedmanufacturing
company• A highly profitablecompany• A progressive
company• A personnel“assets” company

Towards “Evolution” Under NITTOKU SHINKARON
Fiscal 2015 is the final year of NITTOKU SHINKARON representing the 2nd SHINKA (Renovating).
Currently, we are making steady progress on our most important issues that include further
enhancing our spark plugs and sensors, exiting or restructuring unprofitable businesses, andquickly commercializing new products and business ventures.
Specifically, in February 2015 we completed the acquisition of Nihon Ceratec Co., Ltd. Thisacquisition will enable us to utilize Nihon Ceratec’s advanced technical strengths and costcompetitiveness from small-lot, high mix production in the field of components for semiconductor
manufacturing equipment. We will be able to expand our lineup to include all new products neveroffered before. We also determined that synergies can be realized between both companies bycombining these with our overseas sales network and technological development capabilities frommaterials. From now on, we will work to deliver new value in the growing components businessfor semiconductor manufacturing equipment.
In May 2015, we determined the acquisition of Wells Vehicle Electronics from UCI Holdingsof the United States. We examined various possibilities for further strengthening our Automotive
Components Business, and among these we focused on ways to utilize our worldwide sales
network, which is one of our greatest strengths. This brought us to Wells, which is a leading
company in the United States automotive repair market. We determined that an acquisition would
enable us to expand our product lineup further. We will continue to embrace new challenges
going forward as we work to strengthen our Automotive Components Business further.
As for new business ventures, we have committed management resources predominantly tothe environment/energy, healthcare, and next-generation vehicle segments. We finalized a partnershipwith United States venture company Spirometrix in order to gain a toehold in the healthcare sector
as part of our medium- to long-term strategy. Under this partnership, we will aim to create new
products together utilizing our existing sensor technologies. At the same time, we will continue tolaunch new products and new businesses, but to beat out competition globally, we will improvecompany-wide productivity, including not only the production floor but also the back office, andproactively engage in the development of personnel “assets” who will power these activities.

Promotion of CSR Management
To fulfill NITTOKU SHINKARON and achieve sustainable growth, we are strengthening our governancesystem across the entire group and steadily addressing important risks, including crisis management
and raising awareness about compliance in accordance with our CSR policy. However, in fiscal 2014business transactions from the past fiscal year were found to be in violation of competition andanti-trust laws in the United States and South Korea. We take this matter very seriously and have
implemented a preventive program across the entire group to prevent future reoccurrences.
Additionally, we are actively developing environmentally-friendly products and reducing ourCO2 emissions to help preserve the natural environment. At the same time, we are carrying out
citizenship activities closely in tune with our philosophy and policy. The NGK SPARK PLUG Group iscommitted to fulfilling its corporate social responsibilities and accountability as a corporation.
Going forward, we will provide succinct and easy-to-understand information disclosures to all of
our stakeholders about the processes we use to select important issues and the progress of suchprocesses, among other information.
We are pleased to announce the release of CSR Report 2015, which details our activities during fiscal 2014.
We very much appreciate your honest and unreserved comments and opinions.
NGK SPARK PLUG Group6

Our CSR

To Realize Our Corporate Philosophy,
We Act Based on Our Corporate Codeof Conduct and CSR Policy
Three elements constituteour corporate philosophy.

Philosophy and Policy Organization

Enhancement of Corporate Value

Corporate
Philosophy

Corporate
Philosophy

2Management
Policy3
1

Corporate Codeof Conduct

ActionGuideline

Commitment

CSR Policy• Risk Management Policy• Compliance Policy• Information Security Policy• Corporate Quality Policy• Information Disclosure Policy• Procurement Policy

Management Policy
We offer a working
environment in which eachone of us is encouraged tomake full use of his or her
personality and capability.
With all our power we arededicated to pursue
management based ontrust and confidence.

Commitment
With full use of the mostsuitable technology andour accumulated
experience, we continue
striving to offer new values
to the people of the world.

• Human Resource Policy• Occupational Safety and Health
Basic Policy• Social Contribution Policy• Environmental Policy

Action Guideline
Ever onward ! Always
mindful of what is the best
course, we swiftly put it
into action.

SloganWith established trust and confidence inside and outside the Corporation, we aim to contributeto the peoples of the world by creating and putting at their disposal new values for the future.

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CSR Report 2015 Digest Version

WEB

Important Notification
Plea Agreement with the United States Department ofJustice Regarding Our Automotive Parts and Announcementfrom Korea Fair Trade Commission
In August 2014, NGK SPARK PLUG CO., LTD. consented to a plea agreement with
the United States Department of Justice that included the payment of a fine andother details as there had been some violations of U.S. antitrust laws with respect
to some transactions related to automobile spark plugs and oxygen sensors forautomobiles.
In addition, in March 2015, Korea Fair Trade Commission announced that it
would impose a fine for violations of the country’s Monopoly Regulation and Fair
Trade Act. There is a risk that NGK SPARK PLUG Group may be a party tolitigation and penalties and other legal procedures from regulatory authorities inrelation to possible violations of anti-monopoly laws in other countries andregions in the future. NGK SPARK PLUG CO., LTD. apologizes profoundly for theserious concern caused to stakeholders, including shareholders, in relation to thisseries of incidents.
The NGK SPARK PLUG Group has positioned legal compliance as animportant subject for management and has established a compliance system. We
are taking this situation very seriously and are striving to prevent any recurrence
and further strengthen our compliance system as we work to restore confidence.
Specifically, we have established a special team for competition law compliance,
and we are committed to making compliance with competition laws well known
to all through awareness raising activities that include running special seminartraining again for officers and employees throughout the group as well as
progressively carrying out system audits that include group companies overseas.

NGK SPARK PLUG Group8

Renovating NGK SPARK PLUG
Special Feature

Providing new value to people worldwide

The NGK SPARK PLUG Group will provide new value in diverse fields in order to realize our corporate philosophy.

New
products

Developing an intake oxygen sensor to prevent
global warming and atmospheric pollution
IntakeNGK SPARK PLUG decided to develop andcommercialize the intake oxygen sensor ahead ofothers in the industry, applying technology fromautomobile exhaust oxygen sensors, extensively
used in many automotive sensors. The intake oxygen
sensor will contribute greatly to further reducing
NOx generated in diesel engines and CO2 produced
by gasoline engines by precisely controlling the
EGR system that recirculates exhaust gas. In the
future, we will make preparations for mass
production and aim to expand deployment.

Newbusinesses

Throttle

Intake

EGR
valve
EGR
cooleroxygensensorlocation

ExhaustCatalyst

Exhaustoxygensensorlocation

Promoting the fuel cell business to contribute tosolving environmental problems
The commercialization of fuel cells as a next
technology of power generation for businessand industry is approaching. In 2014, NGKSPARK PLUG and Mitsubishi Hitachi Power Systems,
Ltd. formed a business tie-up targeting mass
production of cylindrical cell stacks, the power
generating elements used in solid oxide fuel cells(SOFC). Combining our technologies, the twocompanies are working to construct a production
line in fiscal 2017 in order to contribute to
the realization of a low carbon society.

New
products

Promoting improvements to products to lighten
the load on the medical frontline

A bone filling material in paste-form is used
for sites where a bone transplant is necessary
such as bone loss or a fracture. Cerapaste isa paste-form bone filling material developed
by NGK Spark Plug.
For the conventional product, mixing is
performed by rotating a mixing rod, butlightening the workload involved in mixing wasa challenge. In order to solve this, NGK SPARKPLUG has developed Cerapaste (improved) thatcan be mixed by just moving the mixing rod backand forth, which will contribute to lightening
the load on the medical frontline.

9

CSR Report 2015 Digest Version

Cerapaste

Cerapaste (improved)through new products and new businesses
Pursuing the DNA Project:
an engine to promote new businesses
The DNA (Dynamic New Approach) Project is an engine to promote new businesses launchedin 2009. It is a new company-wide initiative to create new businesses separately from theconventional approach in research and development departments.
The 4th series of DNA initiated in spring 2014 brought together about 30 passionate
volunteers with diverse skills and ideas, ranging from young employees through to veterans.
They met up about once a week to pursue in-house and external investigations by each of theteams that were formed on a voluntary basis and pieced together proposals for new businesses.
Following a final review in spring 2015, a number of proposals are now progressing
through investigation into commercialization. It is expected to produce rapid progress as
a project to drive the future of the NGK Spark Plug Group, not only in the creation of new
businesses, which was the original objective, but also in the development of human resourcesand organizational culture.

Voice of Our Project Member

What I got out of theactivities was huge
Daisuke Tahira

Sensor Engineering Dept. II,
Sensor Division

I am very grateful to get the opportunity to actuallyshape the ideas that I want to try.
I think that experiencing the flow of a businessproposal that cannot be experienced in the normal
course of business, such as the difficulty of making
a business materialize, interviews with potential
customers following detailed study, and making
a proposal to management, will be a great asset
for me in tackling my work in the future.

NGK SPARK PLUG Group10

Renovating NGK SPARK PLUG
Special Feature

Introducing CSR activities in Thailand

2015 marked 41 years since the NGK SPARK PLUG Group expanded into Thailand in 1974 as SiamNGK Spark Plug Co., Ltd. Today, three group companies are based in Thailand and are promoting
the construction of a global production response to the increasing expansion in demand, mainlyin emerging countries.
In Special Feature 2, we will report on activities in Thailand which is expected to continue
playing an active role in the future as a core site in the Asia region.

Siam NGK Spark Plug Co., Ltd.

SparkTec (THAILAND) CO., LTD.

NGK Spark Plugs (Thailand) Co., Ltd.

Risk management and compliance
In 2011, there was large-scale flooding in Thailand, and local Japanese-affiliated companies
also suffered significant damage. Fortunately, the NGK SPARK PLUG Group did not suffer any
damage, but we have formulated
a business continuity plan (BCP) in
preparation for mitigating damageand early recovery of operations in
the event that risks do materialize.
Moreover, in order to maintain
fair and transparent relationships
with customers and suppliers, weregularly conduct education oncompliance, including Thailand’sCompetition Act, to raise awarenessamong employees.
Compliance study session

11

CSR Report 2015 Digest Version

Aiming for an environmentally- and people-friendly
plant that is also risk-resistantWe established two concepts taking the environment and safety into consideration whenconstructing the plant at SparkTec (THAILAND) CO., LTD., which commenced operations in April
2015. The first concept is “an environmentally- and people-friendly plant.” We have created anenvironment that is easy for employees to work in by establishing places for recreation, such as sports
areas. The plant is also environmentally-friendly with consideration given to energy and cost savings,
including measures to counter the heat with high ceilings and natural ventilation, and the use of
sunlight for lighting. The second concept is “a plant that is disaster-resistant.” We have avoided
risks due to heavy rain and flooding by taking measures against rainwater discharge that take into
account maximum local rainfall and measures to prevent the inflow of rainwater from outside.

Plant using natural lighting

Sports area inside the plant grounds

Actively participating in social contribution andenvironmental preservation activities
We have continuously taken part in donating
blood to the local Red Cross and making
contributions to foundations that provide
support to AIDS patients. NGK Spark Plugs(Thailand) CO., LTD. and Siam NGK Spark PlugCo., Ltd., are also involved in anti-drugs
activities run by the local Labour Protection
and Welfare Offices. All the employees atboth companies have received certificationthat they are drug-free.
In the area of the environment, we
actively participate in coastal clean ups andbeachside tree planting activities withinvolvement from employees.

Participants in tree planting

Voice of a Participant in Tree-planting
In the area where our plant is located, there is a mangrove forest along the coastline. Therefore,
we run tree-planting activities to protect the mangroves. Through these activities, we cancontribute to protecting the environment and also get to know people in other departments.

NGK SPARK PLUG Group12

CSR Promotion Activities Targets

We identified the priority themes for the NGKSPARK PLUG Group and established 30 items.
We Established CSR targets Based on our Corporate Philosophy, Corporate
Code of Conduct and CSR Policy, and Considering the Expectations and
Demands of Stakeholders.
We view CSR not just as a responsibility but
as an opportunity to be accountablethrough review of the NGK SPARK PLUG
Group's economic, environmental andsocial activities from a global perspective,
to enhance corporate value, and tocontribute to the sustainable developmentof society in accordance with our Corporate
Philosophy.
The CSR Committee, established in
2010, determines the priority themes foreach fiscal year, to implement CSR Policy.
The Committee also oversees and evaluates
CSR-related activities implemented by therespective committees and divisions, andmakes appropriate proposals regarding
them, so as to achieve full optimization of
CSR activities, thereby strengthening ourbusiness foundations.
The NGK SPARK PLUG Group isconnected to and supported by customers,
shareholders, investors and various otherstakeholders. For that reason, for the group
to be sustainable in the future, we must
aim to grow our business while meetingthe expectations and needs of our
stakeholders.
When we set our targets for fiscal
2015, first each expert committee anddivision confirmed the expectations anddemands of all our stakeholders. Thenthey compared them to our corporate
philosophy, Corporate Code of Conduct
and CSR Policy and drafted targets. Finally,
the CSR Committee approved them.

13

CSR Report 2015 Digest Version

Customers
Environment

shareholders
and investors

Local Communities
and International
Society

Employees

Suppliers

CSR Committee

Corporate Philosophy
Corporate Code of Conduct
CSR Policy· Risk Management Policy· Compliance Policy· Information Security Policy· Corporate Quality Policy· Information Disclosure
Policy· Procurement Policy· Human Resource Policy· Occupational Safety and
Health Basic Policy· Social Contribution Policy· Environmental Policy

Setting CSR Targets

WEB

CSR Targets and Results
Field of activities

CSR management

Medium-term targets (by fiscal 2015)

Department in charge Page

· Implement PDCA cycle to promote CSR on a global basis

CSR Promotion Office· Promote CSR awareness-raising activities on a global basis

13p

Compliance· Develop a compliance promotion system and ensure an appropriate response toviolations, on a global basis.
Promotionsystem29p
Compliance Committee· Implement activities for violation prevention· Understand the actual situation through awareness surveys etc. conducted on aregular basis

Management

Security control· Continuously improve the PDCA cycle for security control and its global
expansion

Confidentiality
Management Committee

Export control· Strengthen professional education on export controls and reinforce the export
control surveillance system

Export Control
Committee

Information
security· Establish network security standards on a global basis

Information Systems
Dept.

Intellectual
property· Establish security control and compliance systems regarding intellectual property

Intellectual Property
Dept.

30p

· Recheck and improve our BCP and shift to BCM

BCM Working Group

30p· Establish our BCP for procurement on a global basis

Procurement Group· Implement IT-BCP measures

Information Systems
Dept.

· Establish enterprise risk management that is suitable for our company

Risk Management
Working Group· Continuously improve our products, work and mechanisms across the company
in order to strengthen our manufacturing capabilities

Quality Committee· Maintain and improve internal control over financial reporting

Accounting & Finance
Dept.

· Disseminate information in an easy-to-understand and friendly manner on a
global basis

Public Relations Officeand CSR Promotion Office· Disseminate information in response to stakeholders’ expectations and thechanges in social trends

CSR Promotion Office

Risk management

BCP/BCMEnterprise risk
management
With Our
Customers

Safety and quality

With our
Information
shareholders
disclosure
and investors· Establish personnel and education systems to realize our management strategies
and policies
Employment andhuman rights

17p

20p

· Establish a human resource development system by occupational ability
Human Resources Dept.

· Establish personnel recruitment management

19p
20p
22p

· Promote personnel appointment on a global basis· Promote diversity

With Our
Employees

15p· Promote and entrench our new risk assessment system· Educate employees to be able to behave safely and establish a corporate cultureof “safety first” on a global basis
Occupationalsafety and health · Develop a framework for minimizing health risks, and achieving a betterawareness of these risks, and establish an appropriate system

Safety and HealthCommittee

21p· Educate employees to be well-versed in safety, and establish an educationalframework and system· Implement new criteria for supplier evaluation

With Our
Suppliers

CSR procurement

With Local
Communities
and International
SocietySocial contribution · Enhance social contribution activities

For Environmental
Protection

Environment· Implement CSR procurement on a global basis· Achieve Eco Vision 2015 and globalize environmental management

Procurement Group and
CSR Promotion Office

18p

General Affairs
Department and CSR
Promotion Office

23p

Environment committee

26p

NGK SPARK PLUG Group14

Responsibilities and Actions for Stakeholders

With Our Customers—— Workplace CSR Activities

To Raise Global Customer Satisfaction Levelsin After Sales Market, Including Repairs
We also provide high quality services based on the appropriate technology andknowledge in the automobile aftermaket and promote diverse activities around theglobe to increase customer satisfaction.
So that they acquire the correct technology and knowledge, we focus on technicalknowledge education for sales staff in Japan and overseas and training for technicalsales staff overseas. In addition, we promote market research activities that include
maintaining and expanding existing needs, exploring and fulfilling new needs, andcollecting and providing technical information and new car and model information.
Furthermore, we work on initiatives to further increase customer satisfaction byoffering tailored assistance such as holding lectures on technology for customers inJapan and overseas, responses to customer inquiries and complaints to our website,
and technical support for customers’ racing activities as sales promotion activities.

Responding to a defect ona customer’s site (Thailand)

Providing support at a repair shop
(India)Providing support at an automobile
components store (India)

Voice of a Member of our Service Staff

We listen to the opinions of customers and arealways conscious of improvement
In the Aftermaket Technical Service Department, we aim
to raise customers’ levels of satisfaction andunderstanding related to products and services.
As an example, we provide support for holding
technical lectures. We constantly strive for improvementby conducting a survey on levels of satisfaction with thecontent of the lecture for each lecture and reflecting theresults of the surveys into the content of lectures toenable greater customer satisfaction levels.

Daisuke Goto

Aftermaket Technical Service Dept.
Sales & Marketing Div.

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CSR Report 2015 Digest Version

WEB

Making People Raising the Quality of Our Manufacturing
We are working to develop our personnel“assets”as “making things is making
people.” We have established training
programs that include quality control,
management engineering techniques, QC
circle activities, quality management
systems, and measurement control andoffer practical guidance and support for theapplication of knowledge learned. We raiseawareness of quality and provide motivation
through quality expos and lectures,
including training for new recruits.

Yuji Kimura

Corporate Quality
Control Dept.

Voice of Our
Training Leader

Participatory Training Heldfor Recruits to Think for Themselves
In training for new recruits, we run participatory trainingthat facilitates learning through experience in order toachieve a high degree of understanding. We haverealized the effectiveness of participatory training witha lot of feedback stating that having a go at doing
things makes it really easy to understand. In the future,
we want to contribute to raising employee awarenessof quality and the quality of products and work througha range of innovative training.
My

Training for new recruits

Item

A text that explainsbasic knowledge
on quality

Serving as Company Chairing the QC Circle Tokai Regional Chapter (Outside Organization)
Voice of the Executive Office,
QC Circle, Tokai Regional Chapter

Applying the Valuable Experience to
NQC Activities
In my duties for the Executive Office of the TokaiRegional Chapter, I worked with people from executive
offices in other areas to organize regional chapter
events and endeavored to popularize and expand
QC Circle activities. Through these duties, I was able
to acquire know how on organizing regional chapter
presentation meetings and ways to promote and run
QC Circle activities. I will apply these experiences tocontinue contributing to invigorating NQC activities.

The Union of Japanese Scientists andEngineers has established nine chaptersaround Japan for QC Circle activities. NGKSPARK PLUG served as the company
chairing the Tokai Regional Chapter
composed of the Aichi, Gifu, Mie, andShizuoka area for one year in fiscal 2014.
Under the slogan for the fiscal year, whichwas “Activating the workplace withrewarding and exciting activities,” we andthe 63 member companies put together
policies and events and worked on
popularizing and expanding them.

Takahiro Abe

Corporate Quality
Control Dept.

My

Item

Knowledge and know howlearned from outsideorganization activities

NGK SPARK PLUG Group16

Responsibilities and Actions for Stakeholders

With Our Shareholders and Investors—— Workplace CSR Activities

Eliminating the Information Gap andDistributing a Variety of Informationin Japan and Overseas in a Timely Manner
In order to disclose information fairly in Japan and overseas, we prepare materials
related to business results and press releases in Japanese and English and post themat the same time on the company website. We also actively make contact with allshareholders and investors inboth Japan and overseas in our
day-to-day investor relations
activities, striving for speedy andaccurate disclosure of information.
We will continue to establish
systems that enable us to meetthe needs of all shareholders andinvestors in Japan and overseas
with the focus on fair information Materials for businessresults briefing anddisclosure.
press releases in English

Engaging in Activities to Make Shareholders and Investors Familiar with NGK SPARK PLUG
We hold company briefing session so thatshareholders and investors have accurate
and deep knowledge about NGK SPARK
PLUG. In fiscal 2014, we visited areas allover Japan to get the unedited opinions of
our shareholders and investors.
Going forward, we will continue
working to focus on and encouragecommunication with all of our shareholders
and investors.

Voice of Our Investor Relations Representative

Accurately Communicating NGK SPARK PLUG
As media exposure for NGK SPARK PLUG increases,
the number of opportunities to hear voices that
support the company and conversely harsh voices
has also increased. In the future, we will continue
listening to diverse opinions and strengthen our
activities so that there is an accurate, deep, andlasting understanding of NGK SPARK PLUG.

Riki Matsuno

Public Relations Office
My

Item

17

Data collecting theopinions of shareholders
and investors

CSR Report 2015 Digest Version

Responsibilities and Actions for Stakeholders

WEB

With Our Suppliers—— Workplace CSR Activities

Enhancing Seminars and Practical
Onsite Courses for Suppliers
NGK SPARK PLUG holds seminars for
suppliers on themes that include process
improvement, quality control, industrial
safety and health, and the environment
as well as practical onsite courses inwhich we visit the production sites ofsuppliers to work for improvements. In
addition, we are working to enhancethese courses so that even more suppliers
are able to take advantage of them.
We implement the activities to help
with human resource development at our
suppliers, enhancing the capabilities of
their companies. Last fiscal year, weestablished a new course for beginners
and held a total of 23 lectures. We aim
to work in partnership with our suppliersin the future to enhance their
manufacturing capabilities.

Scene at a seminar

Completion ceremony for a practical onsite course

Voice of a Practical Onsite Course Organizer

Where There is a Will, There is a Way
In practical onsite training, we not only
communicate techniques alone, but also try
to create an activity that will be sustained byvaluing free exchange of information andautonomy of the participants and theenhancement of their awareness andmotivation.

Masanori Maeda

Supplier Relations & Development
Procurement GroupNGK SPARK PLUG Group18

Responsibilities and Actions for Stakeholders

With Our Employees—— Workplace CSR Activities

Holding the ASEAN Human Resources Conferencein Thailand Aimed at Building Global Mechanisms
for Human Resource Development
We have been holding the Global Human Resource Conference every year since2013 aimed at a global human resources system and human resources
development. Under the initiatives to date, we have created a system for overseas
employees to leave their home countries and take on new environments tocapitalize on their careers at other group companies. Using this system, exchangesof human resources have commenced on a global scale through temporarytransfers (cross-border temporary transfers from overseas group companies).
In order to expand the program further, we held the ASEAN Human Resources
Conference in Thailand in 2015. Human resource managers from Group companies
in Thailand, Indonesia, Malaysia, Vietnam, the Middle East and India took part in a
lively exchange aimed at the introduction of unified policies and mechanisms related
to human resource developmentin the ASEAN region, including
India. Going forward, we willcontinue working to establish aframework in partnership with
the Human Resource Dept. basedon a global consciousness, as we
strive for group-wide developmentof human resources.
Participant in the ASEAN Human Resources Conference
Voice of a Global Human Resources Organizer

Aiming to be a Personnel “Assets” Company
The participation of overseas human resources accounting
for over one third of the group as a whole is a major
driving force at NGK SPARK PLUG. There are differencesin culture, religion, and customs, but I feel that discussing
and working toward the major common objective ofdeveloping personnel “assets” with human resource
organizers from countries around the world is reallyworthwhile. I will aim to further enhance the global
network of the Human Resources Dept. to establish anenvironment that allows individual skills to develop andplay an active part in the group overall.

Tomoyuki Kato

Human Resources Dept.

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Strengthening and Maintaining Initiative to Promote Active Participation of Women
In fiscal 2013 we held training primarily for
managers, and in fiscal 2014 we held
training primarily for women. The actionplans organized by the manager of eachdepartment, which commenced in fiscal
2013, have been maintained, increasingawareness of acting as a department.
Members of DIAMOND Project (Front row, center: Otsuka)

Voice of the project Leader

We aim to create a company where all
employees can play an active role
Training for Next Generation
Female Leaders
We held training for female supervisors and subsection
chiefs, who are close to management positions, to learn
about management, leadership, corporate strategy
and other areas and to interact with officers of NGKSPARK PLUG and managers from other companies.

Our company has many excellent female
employees. I hope we will to be a company
where all employees can work comfortably andtheir ideas can be realized.

Etsuko Otsuka

Human Resources Dept.

CareerAdvancement
Support Program
Women who are aiming for supervisor positions took part with their bosses toattempt challenges one rank above them. In March, the participants presented
the results of their efforts to the President and the Vice President.

Expanding the New Human Resources System to Group Companies in JapanWe are working to consolidate our new
human resources system, which was
overhauled in April 2014, while repeating
Plan-Do-Check-Act cycles in order toestablish an environment for thedevelopment and active participation ofdiverse human resources and appropriately
reward initiatives aimed at creating value.
In addition, we will introduce our new
human resources system at groupcompanies in Japan as well in order tostrengthen governance. In April 2015, we
began introducing our new humanresources system at NTK Ceramic Co. Ltd.
and Ceramic Sensor Co., Ltd.
Main human resources systems• Occupation type, qualification and managerial
position systems• Wage, bonus and retirement money systems• Annual salary system• Rating system and objective management system• Continued employment system

NGK SPARK PLUG Group20

Responsibilities and Actions for Stakeholders

With Our Employees—— Workplace CSR Activities

Equipment Safety Activity in Production
Engineering Depts.
Equipment safety in production sites is one of the important issues for a manufacturing
company. Labor safety initiatives are required that not only conform to Japan’s Industrial
Safety and Health Act but also to international standards such as ISO (International
Standards Organization) and IEC (International Electrotechnical Commission).
In this situation, we have been striving to make production equipment evensafer at the stage of introduction under the Equipment Standardization Projectsince fiscal 2013. In addition
to defining hazard sourcesand evaluating safety basedon risk assessment, and taking
measures to reduce risk, weare identifying residual risk
and providing information
to the production sites. In
this way, we are promoting
the establishment of a safe
workplace through theintroduction of equipment.

Communicating equipment risks using labels

Voice of Our Project Leader

We Provide Safe Equipment, Aiming to Realize“Zero Accidents”
As suppliers of equipment, one of our goals is “zeroaccidents,” and we work to strengthen the provision of
information to ensure this does not end up as a unilateral
hope, but is a recognition that is shared with the
production sites.
Going forward, we will aim to provide even safer
equipment by working to upgrade the skills of designers
and reviewing measures to reduce risk.

Kazuhiro Nozawa
Equipment Dept.

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Toward the Spread and Consolidation of New Risk Assessment (RA)There are a variety of potential risks in theworkplace. New RA is a tool for systematicallyand objectively studying and evaluatinghazard sources related to equipment andwork in the workplace following the
introduction of equipment and visualizing thedegree of danger in the form of a risk level. It
is an activity that we have been expanding instages since fiscal 2013. We can pave theway to the creation of safe and secure
workplaces by determining the order ofpriority according to the magnitude of risk
and implementing workplace management
measures that include countermeasures tosystematically reduce risk and awarenessraising about hazardous locations.

Takahiro
Kawakita

Environment
and Safety
Management Dept.

Voice of Our Safety
and Health Leader

We Aim for Penetration and
Entrenchment of Risk Assessment
The power of every individual worker working on
the frontline is essential for the implementation ofrisk assessment. In order to ensure that many
people learn the right risk assessment philosophy
and techniques, we hold regular Practical Risk
Assessment Training. The training covers
classroom lectures through to learning about
identifying and evaluating hazard sources andmanaging residual risk using actual equipment,
and we hope that they apply these skills to risk
assessment in the workplace.
My

Scene from hands on
RA training using actual equipment

Item

A text compilingsafety and healthknowledge

Strengthening Mental Health Care
We are working on had in-house andexternal Line-Care educational programsfor managers, and implementing to readthe Self-care hand book in our workplace
to make our employee prevent awarenessof disease and self-management of health.
Also we are strongly working on held
in-house lectures and setting up the
Support-line for employees who feel stressand problems mentally.
The Self-Care Handbook(Japanese only)

NGK SPARK PLUG Group22

Responsibilities and Actions for Stakeholders

With Local Communities and International Society—— Workplace CSR Activities

We Support a Professional Soccer
Team that Has a common Philosophy
Based on our social contribution policy of “contributing to society as a good corporate
citizen,” NGK SPARK PLUG concluded an official partner agreement in January 2014
with FC GIFU, a professional soccer club. Based in Gifu Prefecture, a region withwhich NGK SPARK PLUG has strong ties, FC GIFU actively conducts social contribution
activities under the theme of “a team for citizens of Gifu Prefecture.”
In July 2014, we establishedthe NGK SPARK PLUG Prize for the
MVP of the season determinedby the votes of supporters
strengthening the connections
between the team and its
supporters and creating a platform
to push for promotion to the J.
League Division 1. From now on,
all of our employees, including
those at group companies, will be
NGK SPARK PLUG thank you match
united in boosting up FC GIFU.

Voice of FC GIFU “Gifu Genki Activities” Leader

We will Bring Gifu to Life in Partnership with Everyone at NGK SPARK PLUG!
Under the slogan “Competing, Together: Bringing Gifu to Life, Bringing Gifu Together,”
we carried out activities that contributed to the local community a total of 467 times in 42
towns and villages in Gifu Prefecture during the 2014 season. These activities included
holding soccer classes, participating in
local events, providing exercise classes atsenior citizens’ facilities, soccer coachingat child care centers and kindergartens,
and lecture meetings. We have boasted
the highest number of such activities in
the J. League for some time.
In the 2015 season, we will rename
our social contribution program “Gifu
Genki Activities,” and further extend
them to enliven Gifu in partnership witheveryone at NGK SPARK PLUG based on
our desire to bring Gifu to life.
Scene from the Doronko Soccer Tournament

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CSR Report 2015 Digest Version

WEB

Expanding our Locally Rooted Social Contribution Activities both in Japan and Abroad

NGK Spark Plug Middle
East FZE

Bujias NGK de Mexico S.A.
de C.V.

Ceramica e Velas de Ignicao
NGK do Brasil Ltda.

Participated in Clean Up UAE,
organized by an environmental
NGO in Dubai, and conductedclean-up activities in the desert.

Provided food and clothing forchildren in an orphanage, whowere thrilled and sent thank you
letters.

Supported a local basketball teamas a sponsor, contributing todevelopment of local sport.

NGK SPARK PLUG CO., LTD.
Komaki Plant

NGK Spark Plugs (UK) Ltd.

NGK Spark Plugs (U.S.A.), Inc.

Participated in and supported a rally
for wounded soldiers and theirfamilies.

Donated funds and provided a
training area by giving access tocompany site in cooperation withlocal firefighting activities.

NGK SPARK PLUG CO., LTD.
Miyanojo Plant

NGK Spark Plugs (India)
Pvt. Ltd.

Hosted students on work experiencefrom local junior and senior highschools, and students experienced
plug shipment packing work.

Donated water coolers so thatchildren can drink cool water atschool in India, where it is extremely
hot in summer.

Participated in urban planning to
reduce traffic accidents as membersof a company in Aichi Prefecture
which has the highest number offatal traffic accidents in Japan.

NTK Ceramic Co., Ltd.
Ran blood donation drive at requestof the Red Cross.

NGK SPARK PLUG Group24

Responsibilities and Actions to Environment

For Environmental Protection—— Workplace CSR Activities

Establishing System for Environmental
Commendations
We have launched a system ofenvironmental commendations for the
NGK SPARK PLUG Group in Japan tocommend outstanding environmental
initiatives with the aim of encouraging
environmental activities. The best
examples from improvements
implemented in each area are selected toreceive commendations from the President
at the Central Environment Committee.
Greening of area around Miyanojo Plant
In fiscal 2014, which was the firstyear of the system, the four examples below received commendations.
Area
Komaki Plant
Komaki Plant

Department
Sensor Production Engineering Dept.
Production Support Engineering Dept.

Miyanojo Plant

Entire plant

NTK Ceramic Co., Ltd.

Management Dept.

Details
Increased batch size in combustion furnaces
Response to Revised Water Pollution Control Act
Outstanding Green Factory(Minister of Economy, Trade and Industry Award)
Integrated management of firing production plans acrossentire plant

Voice of Our Maintenance and Management Department

We will continue to promote creation ofan environment that coexists with the community

Environment Group

Miyanojo
Nittoku Alpha Service Co., Ltd.

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CSR Report 2015 Digest Version

The Kagoshima Miyanojo Plant, where an integrated production
system for spark plugs has been established, produces thelargest number of plugs for a single plant in the world.
Up to now, we have been promoting the beautificationand greening of the environment in addition to carryingout diverse initiatives over many years. These include
measures to tackle noise using plantings, development ofa ground with natural turf which is provided to local highschool rugby teams for matches and training camps, andthe establishment of cherry trees and a promenade on thesouth side of the plant, which promotes health for employees
who are encouraged to walk.
The hopes involved in each of these individual activities
have led to the receipt of this award, and we take pride in being
the department involved in the maintenance and management.

WEB

Meeting Our Target for Reducing CO2 Emissions
Trend of Emission Volume ofEnergy-Origin CO2 (Offices and Plants)

In fiscal 2014, our CO2 emissions was
163,600 tons, meeting our fiscal 2014
target of 175,000 tons and also lower thanin fiscal 2013. In addition, intensity ofemissions improved by 17% comparedwith fiscal 2007. The target was attained
through energy transformation in the
manufacturing process, updating offacilities (for energy efficiency), achieving
an energy-savings effect by revising ourmanufacturing conditions, and transferring
processes to affiliated companies.

CO2 emissons (10,000 t-CO2)
0.79
0.71

32

0.59

24

20.89
14.57

16
8
0

Non-consolidatedGroup
Intensity (Group)
Intensity (t-CO2/million yen)
0.78
0.8
0.65
0.65
0.6

17.74 17.19 17.35 16.36 18.80
11.53 12.07

0.4

11.23 10.04

7.01

0.2

1990

2007

2011 2012 2013 2014

0

2015

(fiscal Eco Vision
year)
2015
target value

Trend in CO2 Emissions (Group companies in Japan and overseas manufacturing and sales subsidiaries)
Domestic Group

Overseas Factories(10,000 t-CO2)

North
America24%

Africa 2%

30
25

23.84
2.95

20

20.80

20.76

20.38
3.06

3.19

17.74

17.19

3.41

15
20.89

10

16.36

17.35

5
0

2007

2011

2012

2013

Asia 30%

19.65
3.28

2014

(fiscal year)

Overseas
Factories

South
America41%

Europe 3%

Note: For the CO2 emissions factor of purchased
electricity, the Greenhouse Gas Protocol’s factor
for each country was used. A factor the same as
Japan’s was used for fuel.

Trends in Waste Generated
In fiscal 2014, the waste intensity was
0.040 tons/million yen. By reducing theamount of ceramic sludge produced in our
manufacturing process and increasing the
manufacturing process yield, we havelowered the waste intensity 59% comparedwith the fiscal 2007 level.

Trends in Volume of Waste Generated
Volume generated (tons)
40,00030,00020,000

0.100

0.098
28,8550.067

26,052

10,000

2007

0.075

0.058
0.044

11,9000Non-consolidatedGroup
Intensity (Group)
Intensity (tons/million yen)

15,05912,744 11,906
9,513
8,308

2011

0.040

0.050

0.025
7,453
10,997

2012

2013

2014

0

(fiscal year)

NGK SPARK PLUG Group26

Responsibilities and Actions to Environment

For Environmental Protection
Soundly managing chemicals to comply with the international
regulations of different countries
To satisfy customer requests and regulations
such as the ELV Directive, RoHS Directive
and REACH Regulation of the EU, we assign
hazard ranks to substances of environmental
concern. With handling standards for eachrank, we carefully manage non-containmentand reduce their use.
Management System
Customer request

Legal regulation

Masanori Nishi

Electronic Component
Engineering Dept.

Information acquisition
Information control
Hazard rank (internal standards)

Control of amountto be used

Control of content
on products

Voice of Our Controls Organizer

We strive for thorough managementof chemical substances
Amidst progressing globalization, requests from
customers relating to regulation of substances ofenvironmental concern are increasing every year.
In order to provide customers with even safer
products, we strive for thorough management of
the chemical substances in all the products wehandle and compliance with laws and regulations
in partnership with the Environment and Safety
Management Dept.

Reducing the Amounts of Tap and Well Water Used
In fiscal 2014, the water use intensity was
4.90 m3/million yen. Water use intensity
improved by 35% compared with fiscal
2007 due to conserving water by changing
manufacturing conditions and upgrading
and updating to equipment with a highwater-savings effect.

Trends in Volume of Tap Water/Well Water Used
Non-consolidatedGroup
Intensity (Group)3
Intensity (m /million yen)

Volume used (10,000 m3)
350
280
210

10
7.58
190

140

7.52
224

5.35

169
108

8

6.98

154
99

143
89

70
0

2007

2011

2012

2013

4.90
136
75
2014

(fiscal year)

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CSR Report 2015 Digest Version

6
4
2
0

WEB

Developing Environmentally Friendly Products

Hexagon Socket Machining Tools that Last

Longer and Conserve Resources
Shaper Duo
Shaper Duo

Machining

Shaper Duo has been accredited
as an environmentally-friendly
product by the Japan Cutting &Wear-resistant Tool Association forconserving resources and energy.

Conserving Resources
Comparative lifespanof tools

Carbide tool(conventional product)Lasts
approximately

30
times
longerC
Cutting
tools for hexagonal socketmmachining of male screw heads on allathe need to be durable.
SShaper Duo contributes to reducing
tthe volume of tool waste as it can last
aapproximately 30 times longer thanthe conventional carbide tools inwhich the cutting blade is integrated
with the holder.

Shaper Duo

Conserving Energy
Shaper Duo does not only have the advantage of conserving resources. The
hexagonal socket machining of male screw heads, which was previously carriedout through separate processes, can now be performed continuously immediately
after processing of the shaft with a small automatic lathe.
This makes it possible to integrate the processes, thus contributing toconservation of energy in production.

NGK SPARK PLUG Group28

Management

Corporate GovernanceNominating Outside Directors and Strengthening Corporate GovernanceOur company aims to become a true global
company and is endeavoring to further
strengthen corporate governance. As one
aspect of that, one outside director was
appointed in June 2014, following theappointment of one outside director in
June 2013, bringing the number of outside

directors to two.
The outside directors attend regular and ad
hoc meetings of the Board of Directors,
providing supervision for the execution ofduties as well as advice where it is needed
based on their great experience at global
companies and deep insight.

Corporate Governance System
General meeting of shareholders
Appointment/dismissal

Appointment/dismissal

Board of Corporate Auditors

Board of Directors(includes outside directors)

Indication

Audit

Appointment/dismissal

Corporate Management
Committee
Corporate Officers’
Meeting

Cooperates mutually

Independent Auditors

President and CEO
Indication

Corporate
Officers

Cooperates mutually
Indication

Administration Officer in Charge(includes outside directors)

Indication

Business Operation Section/
Group Companies

Internal Auditing Office
Audit

Various Conference and Committees(CSR Committee etc.)

Disclosure

Compliance
Promoting Compliance Education
To reinforce employee awareness ofcompliance, we have been continuing toconduct workplace training based onconventional seminars aimed at different levelsof the corporate structure, the Compliance
Guidebook, and Compliance Newsletter.
In fiscal 2014, we also ran seminars withexternal lecturers aimed at officers anddivisional compliance promotion staff toencourage education and awareness-raisingin all divisions and Group companies.

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CSR Report 2015 Digest Version

Seminar for divisional compliance promotion staff

WEB

Promoting Measures to Stamp Out Counterfeit Goods
Counterfeit NGK SPARK PLUG goods are
spreading, mainly in emerging nations.
To ensure the safety of users and protect
our corporate brand, we are working incooperation with police and customs officials
in various countries to expose counterfeitersand destroy counterfeit goods. We will
also proactively participate in educational
activities to stamp out counterfeit goods
in cooperation with government bodies
and industry organizations.

Exchange of views with customs officials

Risk Management—— Workplace CSR Activities

Distributing Disaster Prevention Goods to
NGK SPARK PLUG Group Employees to
Prepare for the Eventuality of a Disaster
In April 2014, we distributed survival kits, which are essential disaster prevention
items, to NGK SPARK PLUG Group employees in Japan. The contents of the kits
include a helmet, emergency food and water, work gloves, a mask and other items.
These will be essential items for employees in a large-scale disaster. As much as
possible, employees keep the kits close at hand to take with them immediately inthe event of an emergency evacuation.
Disaster prevention items

Survival kits at the workplace

NGK SPARK PLUG Group30

14-18 Takatsuji-cho, Mizuho-ku
Nagoya, Aichi Prefecture 467-8525, Japan
http://www.ngkntk.co.jp
For inquiries, please contact our CSR Promotion OfficeTel: +81 52-872-6248 Fax: +81 52-872-5999
E-mail: csr@mg.ngkntk.co.jp[Period covered]
From April 1, 2014 to March 31, 2015
Some other very recent activities and cases are also
included.
[Organizations Covered]Social aspects: NGK SPARK PLUG CO., LTD.
However, this Report may also cover the activities ofsubsidiaries and affiliates inside and outside Japan.
In such cases, specific company names are indicated.
Environmental aspects: NGK SPARK PLUG Group· NGK SPARK PLUG CO., LTD.
· Nine consolidated subsidiaries and one affiliate in Japan[Publishing Director]
Shinichi Odo, President & Chief Executive Officer[Editor in Chief]
Yukashi Ukai, General Manager of the CSR Promotion
Office[Published]
September 2015 (Publication of the next report isplanned for August 2016.)