DAI-ICHI CUTTER KOGYO K.K.

Climate Impact & Sustainability Data (2020, 2020-06 to 2020-06, 2021-06 to 2021-06, 2022)

Reporting Period: 2020

Environmental Metrics

ESG Focus Areas

Greenhouse gas emissions control
Suppression of vibrations and noise
Water and drainage management
Human capital
Specialized technologies and high-standard services
Contribution to local communities
Fostering of employee job satisfaction
Education and training system
Employee health and safety
Business model and innovation
Risk management and governance

Environmental Achievements

Introduced carbon offset with two services: Intermediate Sludge Treatment Service with Carbon Offset and PlaCon floor®.
Developed ECOA hydraulic drive cutting method, eliminating oil leaks and waste oil treatment.

Social Achievements

Implemented a takeout subsidy to support local restaurants during COVID-19.
Selected as Chigasaki’s first naming rights partner for Chuo Park (renamed Daiichi Cutter Kiiro Park).
Donated yellow safety hats to first-grade elementary school students in Chigasaki.

Governance Achievements

Appointed two outside audit & supervisory board members and two outside directors to ensure management transparency and soundness.
Aims to have all four outside audit & supervisory board members and outside directors as independent officers.

Climate Goals & Targets

Medium-term Goals:

Raise the Sales Composition Ratio of transportation and industrial infrastructure to 50% by FY ending June 2024.

Short-term Goals:

Reduce overtime hours to less than 60 hours per month (FY ending June 30, 2021).

Environmental Challenges

Shortage of personnel and engineers due to declining birthrate and aging society.
Curbing working hours while maintaining attractiveness as an employer.
Improving profitability and productivity while improving the workplace environment.
Impact of COVID-19 on capital investment and order volume.
Risks associated with accidents and compliance with laws and ordinances.

Mitigation Strategies

Work-Life Balance Project to conform to 2024 industry standards.
Efforts to reduce working hours and improve working conditions.
Strengthening relationships with partner companies to maintain order volume.
Development of labor-saving and work visualization technologies.
Comprehensive safety measures, including safety checks, patrols, and training.

Climate-Related Risks & Opportunities

Opportunities

Increased business opportunities through large-scale renovations to reduce carbon emissions.

Reporting Standards

Frameworks Used: SASB

Certifications: Carbon Offset Certification

UN Sustainable Development Goals

Goal 6
Goal 8
Goal 9
Goal 11
Goal 12
Goal 13
Goal 14
Goal 15
Goal 17

Contributions to social infrastructure, takeout subsidy, carbon offset, ECOA method, and work visualization.

Sustainable Products & Innovation

ECOA hydraulic drive cutting method
CoolLaser technology (investment in TOYOKOH Inc.)

Reporting Period: 2020-06 to 2020-06

Environmental Metrics

ESG Focus Areas

Environmental
Social
Governance

Environmental Achievements

Launched "Carbon-Offset Intermediate Sludge Treatment Service" and promoted carbon offset in "PlaCon floor®" service.
Developed water-pressure driven cutting and cutting method ECOA, eliminating oil leakage risks and reducing environmental burden.

Social Achievements

Introduced "Takeout Subsidy" to support local restaurants during the COVID-19 pandemic.
Selected as the first naming rights partner for the central park in Chigasaki City, contributing to the local economy.
Donated yellow hats to first-grade elementary school students.

Governance Achievements

Established a corporate governance system to ensure transparency and soundness of management.
Appointed external auditors and directors to strengthen management oversight functions.

Climate Goals & Targets

Long-term Goals:

Not disclosed

Medium-term Goals:

Increase sales ratio of transportation and industrial infrastructure to 50% by 2024.

Short-term Goals:

Reduce working hours to comply with 2024 regulations.

Environmental Challenges

Workforce shortage in the construction industry due to aging population and industry image.
Need to reduce working hours in line with government regulations.
Maintaining profitability and productivity while improving working conditions.

Mitigation Strategies

Implementing a "Work-Life Balance Project" to reduce overtime and improve work-life balance.
Improving employee engagement through various initiatives, including branding and training.
Developing new technologies and methods to improve efficiency and productivity.
Strengthening cooperation with subcontractors.

Climate-Related Risks & Opportunities

Opportunities

Increased demand for infrastructure maintenance and repair due to climate change.

Reporting Standards

Frameworks Used: SASB Materiality Map

Certifications: Carbon-Offset Certification

UN Sustainable Development Goals

SDG 6
SDG 8
SDG 9
SDG 11
SDG 12
SDG 13
SDG 14
SDG 15
SDG 17

Various initiatives contribute to these goals.

Sustainable Products & Innovation

ECOA water-pressure driven cutting and cutting method
PlaCon floor®

Reporting Period: 2021-06 to 2021-06

Environmental Metrics

ESG Focus Areas

Human Capital
Environmental Initiatives (Greenhouse gas emission reduction, noise and vibration reduction, water and wastewater management)
Innovation and Business Model
Corporate Governance
Social Capital (Specialized technology and high-level services, contribution to local communities)

Environmental Achievements

Launched "Carbon-Offset Intermediate Sludge Treatment Service" and promoted carbon offset in "PlaCon floor®" service.
Developed water-driven cutting and machining method ECOA (Ecoa), eliminating oil leakage risk and reducing environmental burden.

Social Achievements

Implemented detailed training programs and safety manuals for employees.
Improved work-life balance through reduced overtime, increased holidays, and enhanced welfare benefits.
Enhanced employee engagement through branding initiatives and internal communication.
Community investment through naming rights contracts, work experience workshops, and donations to children's canteens.

Governance Achievements

Increased the number of outside directors to more than half of the board of directors following an incident of embezzlement in a subsidiary.
Established an external whistleblowing system to enhance psychological safety for employees.

Climate Goals & Targets

Medium-term Goals:

Achieve a market capitalization of ¥100 billion.
Become the world's leading engineering group.

Short-term Goals:

Achieve less than 45 hours of overtime, including holidays, by 2024.
Further enhance work-life balance through flexible work arrangements and improved benefits.

Environmental Challenges

Shortage of skilled labor due to Japan's aging population and declining birthrate.
Maintaining profitability as a subcontractor in a competitive construction industry.
Addressing the environmental impact of construction activities.
Ensuring corporate governance and compliance.

Mitigation Strategies

Aggressive recruitment and training programs, including a mentorship system and a month-and-a-half-long training for 3rd-year employees.
Development of new technologies and methods to improve efficiency and reduce environmental impact.
Strengthening corporate governance through increased external board representation and an external whistleblowing system.
Strengthening the network with partner companies.

Supply Chain Management

Climate-Related Risks & Opportunities

Opportunities

Increased demand for infrastructure maintenance and repair due to climate change impacts.

Reporting Standards

Frameworks Used: SASB Materiality Map

Sustainable Products & Innovation

ECOA (Ecoa) water-driven cutting and machining method
PlaCon floor®

Reporting Period: 2022

Environmental Metrics

ESG Focus Areas

Environment
Social
Governance

Environmental Achievements

Construction of new intermediate treatment facilities in Tochigi and Mito, reducing environmental impact and differentiating services.
Launched "Intermediate Sludge Treatment Service with Carbon Offset" and "PlaCon floor®", promoting carbon offsets.
Switching to GTL fuel, reducing CO2 emissions by 8.5% compared to light oil.

Social Achievements

Held workshops for all employees to reaffirm the significance of working at DAI-ICHI CUTTER.
Relocated and renovated Mito office to increase employee labor productivity.
Renovated three offices in the northern Kanto region to improve work efficiency.
Donated 100 tablets to an NPO.
Introduced donation-type vending machines.
Achieved ahead-of-schedule targets for reducing overtime hours.

Governance Achievements

Increased the number of outside directors, establishing a system where outside directors make up the majority of the Board of Directors.
Began disclosing a skill matrix to ensure management transparency.
Newly formulated a sustainability policy and materialities.

Climate Goals & Targets

Short-term Goals:

Reduce overtime hours to basically less than 45 hours per month by 2024.

Environmental Challenges

Insufficient sales for work performed directly due to the departure of construction personnel in the building maintenance business.
Need to curb working hours in the construction industry by 2024.
Securing human resources in an industry with a widening supply-demand gap.

Mitigation Strategies

Promoting a work-life balance project to reduce overtime and improve working conditions.
Strengthening recruitment and training of human resources to improve the brand value of "technicians".
Implementing a more flexible paid leave system, adopting a complete five-day workweek system, and expanding retirement benefit programs.