Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Achieved ISO14001 certification across all production sites.
• Developed perovskite solar cells, aiming for mass production in 2023.
• Continued efforts in energy efficiency improvements and CO2 emission reduction.

Social Achievements

• Maintained 100% return rate for employees after maternity/paternity leave.
• Implemented various employee well-being programs, including health check-ups and subsidies.
• Promoted diversity and inclusion through increased female and international hires.

Governance Achievements

• Implemented a robust corporate governance structure with independent board members.
• Established a Sustainability Committee to oversee ESG initiatives.
• Introduced a stock-based compensation plan for directors (excluding outside directors).

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impact on global production.
• Global supply chain disruptions, particularly semiconductor shortages.
• Rising energy consumption due to automation and labor-saving initiatives.

Mitigation Strategies

• Implemented countermeasures to mitigate the impact of the pandemic.
• Closely monitoring the semiconductor shortage situation.
• Balancing automation/labor-saving with environmental considerations.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Perovskite solar cell development

Reporting Standards

Frameworks Used: TCFD

Certifications: ISO 14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Perovskite solar cells
• Eco-friendly materials for high-speed connectors

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Corporate Governance

Environmental Achievements

• Installed solar power generation equipment in two plants
• Switched to LED lighting in offices and production facilities
• Purchasing electricity generated from renewable energy sources
• Acquired ISO 14001 certification at all production bases

Social Achievements

• Maintained a 100% return-to-work ratio after maternity or childcare leave
• 10% of all female employees have changed their career path from general to career/business positions
• Initiatives to reduce overtime hours, including flextime system and planned annual leave system
• Subsidizing the cost of complete physical checkups for employees and their spouses

Governance Achievements

• Increased corporate value by enhancing compliance, CSR, internal control, information security, and risk management systems
• Strengthening management foundations based on compliance with Japan’s Corporate Governance Code
• Introduced an Audit & Supervisory Board system with two of three members being Outside Audit & Supervisory Board Members

Climate Goals & Targets

Environmental Challenges

• Semiconductor shortages
• Exchange rate fluctuations
• Need for decarbonization and carbon neutrality
• Insufficient assertiveness and competitive drive among employees

Mitigation Strategies

• Developed alternative sourcing strategies
• Implementing appropriate air conditioning temperature control, switching to LED lighting, stopping unnecessary lighting and equipment, reducing the number of company-owned vehicles, and promoting “stop idling” measures for vehicles.
• Clarifying the path toward carbon neutrality as a Group, led by our Sustainability Committee
• Offering training for managers to foster assertiveness and competitive drive

Supply Chain Management

Supplier Audits: Internal audits by suppliers and audits by Hosiden

Responsible Procurement

• Green procurement
• OECD Due Diligence Guidance Annex II for Responsible Supply Chains of Minerals from Conflict and High Risk Areas

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters

Transition Risks

• Regulatory changes

Opportunities

• Development of energy-efficient products
• Perovskite solar cells

Reporting Standards

Frameworks Used: TCFD

Certifications: ISO 14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 13 (Climate action)

Not disclosed

Sustainable Products & Innovation

• Perovskite solar cells
• Energy-saving products

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Corporate Governance
• Human Rights
• Supply Chain Responsibility

Environmental Achievements

• Reduced CO2 emissions by approximately 20% through solar panel installation at UK subsidiary in FY2023
• Achieved a B+ CDP climate change score in FY2023, exceeding the target of B-
• Reduced inventories by 8.7 billion yen year on year through comprehensive inventory control

Social Achievements

• Maintained a 100% return-to-work ratio after maternity or childcare leave
• 10% of female employees changed career paths to career/business positions
• Implemented various initiatives to create a safe and healthy work environment, including health and safety patrols, risk assessments, and work hour management

Governance Achievements

• Strengthened compliance system, CSR system, internal control system, information security management system, and risk management system
• Increased equity-to-asset ratio to 77.1%
• Introduced an Audit & Supervisory Board system with two of three members being Outside Audit & Supervisory Board Members

Climate Goals & Targets

Environmental Challenges

• Declining global demand for electronic components impacted FY2023 results
• Some automakers did not meet their annual sales forecasts, resulting in decreased sales of electro-mechanical and display components
• Difficulty in formulating a company-wide Medium-Term Management Plan due to the dependence on amusement-related sales

Mitigation Strategies

• Strengthened corporate structure by improving balance sheet soundness through thorough inventory control
• Allocated funds to repurchase own shares, maintain dividend payout ratio, and undertake capital investment
• Formulated a three-year plan (FY2025) for focus markets excluding amusement, covering mobile communication, automotive, medical, and IoT/IoE

Supply Chain Management

Responsible Procurement

• Due Diligence Guidance Annex II for Responsible Supply Chains of Minerals from Conflict and High Risk Areas

Climate-Related Risks & Opportunities

Physical Risks

• Wind and flood damage
• Rising temperatures affecting air conditioning efficiency

Transition Risks

• Strengthening of regulations
• Increased demand for energy-saving designs and low-carbon materials
• Increased customer requests for CO2 emission reductions

Opportunities

• Business expansion in decarbonization technologies
• New orders and product switching due to satisfying customers' environmental requirements
• Improved corporate image and increased stock prices

Reporting Standards

Frameworks Used: TCFD

Certifications: ISO 14001

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 13 (Climate Action)

Sustainable Products & Innovation

• Solar panels
• Perovskite solar cells

Awards & Recognition

• Excellence Performance Award from Subaru of Indiana Automotive, Inc. (SIA)
• Supplier Quality Excellence Award from General Motors Company