TOPSustainabilitySustainability at the Asahi Kasei Group Sustainability at the Asahi Kasei Group Basic Approach The Asahi Kasei Group has set "contributing to life and living for people around the world" as our Group Mission, and we have grown through repeated contribution to solving social issues. Our commitment to solving social issues has been a constant ever since our company was founded with the aim of "improving human culture." Today, discussions aimed at achieving "sustainable society" are taking place around the world. Since the challenge of a "sustainable society" is a challenge that concerns people and the global environment, the Asahi Kasei Group believes that the pursuit of "living in health and comfort" and "harmony with the natural environment" set out in our Group Vision will lead to "sustainable society." In "Cs+ for Tomorrow 2021," our new three-year medium-term management initiative, launched in fiscal 2019, we expressed the stance of the Asahi Kasei Group, which will continue contributing to sustainable development for people and the Earth going forward, in the phrase "Care for People, Care for Earth." This expresses the approach to sustainability that the Asahi Kasei Group aims for. The mission of the Asahi Kasei Group is to continue proactively contributing to the world as a leader in solving social issues, carrying on the commitment we have had since the founding of our company. "Enhancing sustainable growth of corporate value" in conjunction with "contributing to sustainable society" is also important. "Contributing to sustainable society" produces business profit, which enhances the corporate value of the Asahi Kasei Group. Enhancing corporate value will lead in turn to further "contribution to sustainable society" through business development. Sustainability for Asahi Kasei means achieving the two mutually reinforcing aspects of sustainability, "contributing to sustainable society" and "enhancing sustainable growth of corporate value." Contribution through Business Activities Management Configuration Actions for sustainability throughout the Asahi Kasei Group are guided by our Sustainability Committee in coordination with the more specialized Risk Management & Compliance Committee and Responsible Care Committee which implement individual projects. All three of these committees are chaired by the President of Asahi Kasei. Our Global Environment Committee, chaired by the Executive Officer for Technology Functions, holds specialized discussions on global environmental measures as a subcommittee of the Sustainability Committee. Framework for Sustainability Strategy (as of September 1, 2020) Message from the General Manager, Sustainability Strategy Planning Department Since the start of our medium-term management initiative in fiscal 2019, the Sustainability Strategy Planning Department, a department dedicated to Group-wide sustainability, has been promoting relevant efforts. Conventionally, when it came to expanding our corporate value, we tended to focus on the financial aspects, such as sales and profits. However, we believe that addressing the non-financial aspects as well, such as what to do and how to go about doing it, is what ultimately leads to the true expression of corporate value. In the past one to two years, there has been a marked increase in awareness regarding problems of greenhouse gases, plastic waste, and other issues related to achieving harmony between the development of human society and the global environment. In addition, initiatives for issues related to the "S" in "ESG," such as human rights and a sound supply chain, have become even more essential. The spread of COVID-19 has presented our society with yet another major issue as well. With this wide range of significant issues in mind, Asahi Kasei will focus on sustainability to figure out what it can do to help achieve a sustainable society, then take decisive action . We will strive to listen to the views of all of our stakeholders so that we can earn society’s trust and meet its expectations as a company that creates value. Tatsuhiko Tokunaga General Manager, Sustainability Strategy Planning Department Asahi Kasei Corp. Asahi Kasei Group effort for the SDGs The 2030 Agenda for Sustainable Development was adopted by the UN Sustainable Development Summit in September 2015. The agenda includes 17 Sustainable Development Goals (SDGs) and 169 targets such as ending poverty and inequality, and taking action on climate change. The Asahi Kasei Group contributes to achievement of the SDGs through diverse businesses that provide new value to society by enabling its Group Vision of "living in health and comfort" and "harmony with the natural environment." Materiality In fiscal 2017 the Asahi Kasei Group organized the priority issues and themes it aims to address and designated these as the materiality of the Asahi Kasei Group. We have organized our activities according to the demands of society and indicated the items of the highest importance to stakeholders and the Asahi Kasei Group, taking into consideration ISO 26000, GRI standards, and the key elements of ESG. We organized the relationships between this materiality and the sustainable development goals (SDGs) as follows. Our Group will advance our initiatives while incorporating the perspectives of various stakeholders. Materiality List Theme Materiality Related SDGs Supervising organization (Joint supervision: Sustainability Strategy Planning Department) Harmony with the environment We position initiatives for the global environment as important issues, and we are working on measures regarding climate change, preservation of biodiversity, development of a recycling-oriented society, and other initiatives. Using our diverse technologies, we will also develop materials and products that contribute to conserving energy and reducing CO2 emissions. Global environment* Each business division and operating company Corporate Research & Development Greenhouse gas Corporate ESH Wastewater Corporate ESH Industrial waste Corporate ESH Biodiversity Corporate ESH Living in health and comfort We will contribute to healthy and comfortable lifestyles and affluent living with our distinctive products and technical capabilities. Health and longevity* Each business division and operating company Corporate Research & Development Comfortable life* Each business division and operating company Corporate Research & Development Basic activity We will strengthen the base for business development, leading to the creation of new value. Governance General Affairs Compliance /sincerity General Affairs Risk management General Affairs Safety/quality Corporate ESH/Corporate Quality Ensurance Human rights Human Resources /Corporate Procurement & Logistics Human resources Human Resources Diversity Human Resources Supply chain management Corporate Procurement & Logistics Communication with stakeholders Investor Relations /Human Resources /General Affairs and others Social contribution General Affairs * Contribution through business Participation in initiatives (major initiatives) Global Compact The Asahi Kasei Group supports the United Nations Global Compact. UN Global Compact Business Call to Action (BCtA), a multilateral alliance led by the United Nations Development Programme (UNDP), challenges companies to advance core business activities that contribute to the achievement of the Sustainable Development Goals (SDGs). Asahi Kasei joined with an initiative to support the fiber industry in India throughout the supply chain for Bemberg™ cupro. Business Call to Action Clean Ocean Material Alliance (CLOMA) The Clean Ocean Material Alliance (CLOMA) is a platform established to accelerate innovation by strengthening collaboration among a wide range of stakeholders across industry sectors amid a need to implement worldwide initiatives to overcome the marine plastic litter problem, a global-scale challenge. Clean Ocean Material Alliance White Logistics Movement The White Logistics Movement is aimed at ensuring stability in logistics needed for people's daily lives and industrial activity and contributing to economic growth in response to the truck driver shortage, which continues to intensify. The Ministry of Land, Infrastructure, Transport and Tourism, the Ministry of Economy, Trade and Industry, and the Ministry of Agriculture, Forestry and Fisheries are the advocates of the movement. Asahi Kasei has made a statement of voluntary action endorsing the movement and is working to improve logistics. White Logistics Movement portal site (in Japanese) Challenge Net Zero Carbon Innovation (Challenge Zero) Challenge Zero is an initiative promoted by the Japan Business Federation (Keidanren) in coordination with the Japanese government to support companies and groups in their efforts to achieve a decarbonized society. Asahi Kasei supports this initiative and has announced specific efforts and policies: Challenge Zero Keidanren Biodiversity Declaration Initiative The Keidanren Biodiversity Declaration Initiative is a support effort by the Japan Business Federation (Keidanren) to promote autonomous, active efforts by companies to partake in biodiversity preservation activities, with the aim of achieving harmony between the environment and the economy. Asahi Kasei supports this initiative and has announced specific efforts and policies: Keidanren Biodiversity Declaration Initiative (in Japanese) Membership in organizations (main organizations) Name of organization Asahi Kasei's role Japan Business Federation (Keidanren) Vice Chair of Board of Councillors Chair of Committee on Environment and Safety, Chair of Committee on Social Security Japan Chemical Industry Association (JCIA) Vice Chairman Relationships with Stakeholders Our business operations depend on relationships of trust with our stakeholders. We believe that corporate value is raised by understanding the requirements and meeting the expectations of various stakeholders such as customers, suppliers, shareholders, investors, the general public, local communities, and employees. We provide many opportunities for communication to enable our business operations to be improved through dialog with stakeholders. Communication with stakeholders Main stakeholders Basic premises Main opportunities for communication Customers We believe that it is by maintaining customer satisfaction and providing reliable and enjoyable products and services that we contribute to society. Face-to-face discussion by marketing and sales personnel Taking inquiries via telephone, website, etc. Shareholders and investors We strive to disclose information in a timely and fair manner to enable our domestic and international investors to gain an accurate understanding of the Asahi Kasei Group. Meeting with securities analysts and institutional investors Seminars for individual investors Website disclosure of information Taking inquiries via telephone, website, etc. Suppliers A relationship of mutual trust with our suppliers is fostered through fair and principled purchasing practices based on regulatory compliance and respect for the environment and human rights. Safety discussion forums CSR surveys Compliance hotline (whistleblower system) Local communities and the general public We work to honor and respect the local culture of each community where our operations are based, and to maintain effective dialog and communication with community members. Periodic community dialog meetings Community outreach initiatives Employees The Asahi Kasei Group considers fulfilling and satisfying working conditions and workplace culture, in which personnel feel motivated to achieve and take pride in their career, to be a key to business performance. Training and interviews Discussion and interaction with management Internal magazine and intranet Compliance hotline External evaluation Inclusion in socially responsible investment indexes Continuing from 2019, in 2020 our company was selected as a component stock for the FTSE4Good Index Series and FTSE Blossom Japan Index, which are stock indexes used by the Government Pension Investment Fund (GPIF) for investments related to ESG. In addition, we were also selected as a component stock in the MSCI Japan ESG Select Leaders Index, the MSCI Japan Empowering Women Index (WIN), and the S&P/JPX Carbon Efficient Index, which are also used by the GPIF as ESG investment indexes. FTSE4Good Index Series FTSE Blossom Japan Index MSCI ESG Leaders Indexes MSCI Japan ESG Select Leaders Index MSCI Japan Empowering Women Index (WIN) S&P/JPX Carbon Efficient Index Selected as "A-" company by CDP in the "climate change" and "water security" categories In the CDP's survey for 2019, our company was selected as an "A-" (A minus) company in the "climate change" and "water security" categories. This was the fifth consecutive year we received an evaluation of A- for climate change (fiscal 2015 to fiscal 2019) and the first year we received it for water security. Related information Information Disclosure Policy Accurate and timely disclosure of information to our shareholders and investors is performed in accordance with the Asahi Kasei Group Information Disclosure Policy. 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