Climate Change Data

Environmental Metrics

ESG Focus Areas

• Decarbonization
• Technology and product development
• Safe and secure manufacturing
• Strengthening corporate governance
• Creating an organization in which diverse employees can play an active role
• Communication with investors and stakeholders
• Occupational health and safety

Environmental Achievements

• Obtained ISO 14001 certification
• Underwent an "Energy Conservation Optimization Assessment" in 2022 to reduce energy consumption
• Launched parts cleaning service in 2019 to reduce environmental impact
• 10% reduction in carbon dioxide emissions per unit sales in FY2023 (Compared to FY2022)

Social Achievements

• Obtained ISO 45001 certification in July 2022 for occupational health and safety
• Improved workplace environment through work-style reform, increasing the rate of employees taking long-term leave to 80% in FY2022 (Goal: 85% in FY2023)
• Revised "Corporate Code of Ethics" and held explanatory briefings for all employees in FY2022
• Conducted mental health and harassment seminars in FY2022
• Support circle activities to invigorate interactions among officers and employees

Governance Achievements

• Introduced an executive officer system in April 2022 to separate supervisory and executive functions
• Established a Nomination and Compensation Committee
• Evaluation of the effectiveness of the Board of Directors in FY2022 confirmed proper management and effectiveness
• Public disclosure of activities to strengthen governance

Climate Goals & Targets

Environmental Challenges

• Climate change and other environmental issues
• Digital and other technological innovations
• Post COVID-19
• Demographic changes
• Increased geopolitical risks
• Growing interests of investors and stakeholders in social issues
• Shortage of human resources and increased labor costs
• Raw material procurement risks
• Risks of reduced manufacturing volume by customers
• Risks of customer defection due to delayed response to climate change
• Risks of cash flow impairment due to introduction of carbon tax
• Risks of damage to the local environment due to chemical spills

Mitigation Strategies

• Strengthening production and sales systems at the Taiwan plant
• Acquiring/training human resources
• Improving business continuity planning
• Strengthening initiatives related to ESG foundation
• Exploring business opportunities overseas and in other industries
• Development of materials for next-generation high-performance semiconductors
• Study of initiative policies for grasping and reducing GHG emissions in the supply chain
• System introduction and improvement of efficiency of emission calculation
• Identification of water risks and implementation of countermeasures, diversification of raw material sources
• BCP formulation/continuous review at each supplier
• Strengthening of proactive measures (Review of inventory levels, Consideration of multiple purchases and locations, etc.)
• Setting long-term GHG reduction targets

Supply Chain Management

Responsible Procurement

• Transition to low-carbon products/suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Flooding
• Increased energy procurement costs

Transition Risks

• Policy and regulation (carbon tax)
• Technology
• Market
• Reputation
• Rise in interest rates

Opportunities

• Cost reductions through the introduction of renewable energy
• Increase in semiconductors for EVs
• Proactive response to climate change issues

Reporting Standards

Frameworks Used: GRI, SASB, TCFD

Certifications: ISO 14001, ISO 45001, ISO 9001

Sustainable Products & Innovation

• Recycled products
• Low-carbon products

Environmental Metrics

ESG Focus Areas

• Decarbonization and carbon neutrality
• Technology and product development
• Manufacturing in harmony with the environment
• Safe and secure manufacturing
• Strengthening corporate governance
• Creating an organization in which a diverse workforce can thrive
• Communication with investors/stakeholders

Environmental Achievements

• Parts cleaning service launched in 2019, with increasing orders and preparation for new equipment and local support in Taiwan.
• 4.5% reduction in carbon dioxide emissions in FY2023 compared to FY2022.
• Effective use of resources through returnable product containers (collection and reuse).
• Thorough management of wastewater and exhaust gas to reduce environmental burden.

Social Achievements

• Launched "Health Management" initiative in 2023, recognized as a "Yamanashi’s Excellent Health Management Company."
• Improved employee turnover rate and retention through enhanced benefits, evaluation system, and health management.
• Promotion of work style reform, increasing long-term leave acquisition rate to 80% in FY2023.

Climate Goals & Targets

Environmental Challenges

• Decline in semiconductor demand due to decreased stay-at-home demand and rising prices.
• Inventory adjustments and production cutbacks by semiconductor manufacturers.
• Stringent safety inspections at customer plants, increasing time to handle new chemical products.

Mitigation Strategies

• Operational reforms and improved cost performance to respond to customer requests.
• Development of new chemicals and their introduction into the market.
• Aggressive proposals and development to ensure timely responses, considering increased personnel and new local bases.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Periodic surveys of suppliers
• Evaluation and management of suppliers
• Securing alternative suppliers in case of emergency

Climate-Related Risks & Opportunities

Physical Risks

• Flooding
• Plant shutdowns of suppliers

Transition Risks

• Carbon tax
• Increase in energy procurement costs
• Increase in electricity costs
• Increase in unit cost of raw materials for plastic packaging materials
• Increase in interest rates
• Conversion to renewable raw materials

Opportunities

• Cost reductions through the introduction of renewable energy
• Increase in revenue from new product development and sales (semiconductors for EVs)

Reporting Standards

Frameworks Used: International Integrated Reporting Framework (IIRC), Guidance for Collaborative Value Creation (METI), GRI, SASB

Certifications: ISO 9001, ISO 14001, ISO 45001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 9 (Industry, innovation, and infrastructure)
• Goal 12 (Responsible consumption and production)
• Goal 13 (Climate action)

The company's initiatives contribute to these goals through decarbonization efforts, sustainable manufacturing practices, resource conservation, and technological innovation.

Sustainable Products & Innovation

• New etching material for next-generation 3D-NAND
• CVD material for advanced logic semiconductors
• High-k material for logic applications

Awards & Recognition

• Yamanashi’s Excellent Health Management Company

Environmental Metrics

ESG Focus Areas

• Sustainability
• Human Capital
• Governance

Environmental Achievements

• Calculation of GHG emissions for the fiscal year ended January 31, 2024
• Conclusion of a green partnership agreement with Minami-Alps City

Social Achievements

• Certification as a Yamanashi Company with Excellence in Health and Productivity Management
• Establishment of a subsidiary in China to enhance local services and direct sales

Governance Achievements

• Commencement of the Sustainability Committee’s operations
• Appointment of external officers (two directors and two auditors)

Climate Goals & Targets

Environmental Challenges

• Increase in labor expenses for manufacturing
• Increase in selling, general and administrative expenses
• Increase in manufacturing expenses
• Soaring prices of some raw materials

Mitigation Strategies

• Sales price negotiations
• Improving productivity and ability of existing materials of the Second Plant and other facilities
• Preparing for the establishment of a production system for next-generation semiconductor materials at the Minami-Alps Business Office
• Continuing to enhance the management systems for safety and quality
• Expanding and promoting product assessment by customers at the Taiwanese subsidiary

Supply Chain Management

Climate-Related Risks & Opportunities