Climate Change Data

Environmental Metrics

ESG Focus Areas

• Quality education
• Decent work and economic growth
• Industry, innovation and infrastructure
• Reduce inequalities
• Responsible consumption and production

Environmental Achievements

• Reduced paper use by 23.5% (FY23/3 compared to FY21/3)

Social Achievements

• Increased percentage of female employees to 36% in FY23/3
• Increased retention rate for employees who concluded an employment agreement to 74.4% in FY23/3
• Increased number of new recruits by 76.5% to 1,472 in FY23/3
• Expanded career opportunities and increased work satisfaction of experienced dispatched employees by providing them with opportunities to acquire more advanced technical and specialized skills

Governance Achievements

• Increased the number of outside directors
• Established a Board of Auditors, a majority of whose members are outside auditors
• Established a Nomination and Compensation Committee

Climate Goals & Targets

Environmental Challenges

• Slow expansion overseas compared to other major companies in the same industry
• Potential upward trend in recruiting and education costs due to a seller's market for temporary staff and limited number of experienced workers
• Lack of female or non-Japanese directors, and currently faces the problem of expertise in technology and ESG

Mitigation Strategies

• Established COPRO VIETNAM CO., LTD. in April 2021 to build a human resource training and temporary staff dispatching and introduction business in Vietnam
• Continually recruiting and educating new graduates and inexperienced workers to expand the universe of temporary staff technicians and maintain high quality worksites
• Recognizes the need to sell off some of his holdings at an appropriate time and using an appropriate method that does not impact the market to improve governance

Supply Chain Management

Climate-Related Risks & Opportunities

UN Sustainable Development Goals

• Goal 4
• Goal 8
• Goal 9
• Goal 10
• Goal 12

Initiatives related to human resource development, sustainable industrialization, and responsible consumption and production.

Environmental Metrics

ESG Focus Areas

• Human Resources
• Work Style Reform
• Cost Ratio Improvement
• Sales Innovation
• Operating Efficiency
• Compliance

Social Achievements

• Increased number of COPRO engineers by 36 to 2,020 as of March 31, 2021.
• Implemented workstyle reforms including telecommuting and employee webinars.
• Opened new branches (Niigata, Chiba, Shizuoka, Kitakyushu Plant) and rebuilt existing ones.
• Established/renovated training centers for COPRO engineers.

Governance Achievements

• Changed stock listings to the First Sections of the Tokyo Stock Exchange and the Nagoya Stock Exchange in September 2020.
• Established a Remuneration Advisory Committee to ensure transparency and fairness in determining officer compensation.
• Implemented a restricted stock compensation system.

Climate Goals & Targets

Environmental Challenges

• Securing and developing human resources in a seller's market for skilled engineers.
• Responding to revisions in the Worker Dispatch Law (equal pay for equal work).
• Strengthening sales skills to increase business transactions.
• Controlling long working hours due to stricter workstyle reform laws.

Mitigation Strategies

• Utilizing employee referrals and Gen-Kyari recruiting site to secure high-value human resources.
• Implementing practical training programs at training facilities.
• Providing support for acquiring qualifications and career advancement for dispatched engineers.
• Improving sales processes, matching, and introducing efficiency-improving tools.
• Compiling and analyzing client/project data to maintain high operating rate.
• Providing IT devices to monitor dispatched engineers' working hours and collaborating with client companies to improve working environment.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Engineer retention and training
• Workforce diversity
• Sustainable business practices
• SDG alignment

Environmental Achievements

• Not disclosed

Social Achievements

• High engineer retention rate (around 80%) through education, training, and mental healthcare support.
• Active recruitment of engineers, increasing the total number to 2,002 by the end of FY3/21 2Q.
• Implementation of a welfare program (COPRO Mileage Club).

Governance Achievements

• Upgraded listings to the Tokyo Stock Exchange First Section and the Nagoya Stock Exchange First Section in September 2020.
• Increased dividend payout.

Climate Goals & Targets

Environmental Challenges

• One-time costs impacting profits in FY3/21 1H.
• Responding to the Equal Pay for Equal Work for Dispatch Workers system.
• Seasonal factors in the construction industry.

Mitigation Strategies

• Negotiations to increase charges to offset increased costs.
• Strategic management of orders to avoid periods of engineer standby.
• Active recruitment to increase engineer numbers and mitigate seasonal variations.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Improving the training rate for inexperienced employees, promoting the recruitment of inexperienced employees, improving the ratio of female employees, improving the retention rate, improving the ratio of foreign employees, and promoting paperless work.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Stock Liquidity
• Sustainability

Governance Achievements

• Aiming to satisfy the level required of the Prime Market in order to achieve sustainable growth and increase corporate value over the medium to long term.
• Working toward the implementation of the Corporate Governance Code, which was revised in June 2021, with a focus on principles that are applied only to, or weighted by, the Prime Market.
• Appointing at least 1-third independent outside directors
• Establishing a Nomination Committee and Compensation Committee, which are composed of a majority of independent outside directors
• Publishing a skill matrix
• Publishing policies, targets, and status of recruitment of core human resources for women, foreigners, and mid-career recruits
• Enhancing the quality and quantity of disclosures based on climate-change TCFD
• Formulating policies on sustainability initiatives

Climate Goals & Targets

Environmental Challenges

• Tradable Share Market Capital below the Prime Market’s continued listing criteria (5.31 billion JPY vs. required 10 billion JPY)

Mitigation Strategies

• Enhancing corporate value with a focus on expanding business performance to achieve a tradable share market capital of at least 10 billion JPY by March 2027.
• Enhancing corporate governance and improving stock liquidity.
• Promoting each business strategy based on the medium-term management plan (FYE2023 to FYE2027).
• Raising awareness in the capital markets and promoting understanding among individual and institutional investors.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD

Environmental Metrics

ESG Focus Areas

• SDGs
• ESG

Environmental Achievements

• Reduced paper usage (specific quantification not provided)

Social Achievements

• Certified as a Health & Productivity Management Excellent Company 2021 (large-scale business sector) by the Ministry of Economy, Trade and Industry and the Japan Health Conference.
• Increased number of trainees, increased number of inexperienced employees, increased percentage of female employees, increased number of foreign employees, increased retention rate

Governance Achievements

• Statement of intent to comply with the Prime Market listing maintenance standards

Climate Goals & Targets

Environmental Challenges

• Increase in cost of sales due to the 'Equal Pay for Equal Work' system implemented in April 2020.
• Temporary decrease in assignment cases due to the COVID-19 pandemic leading to increased turnover of less experienced engineers.
• Seasonal fluctuations in construction projects

Mitigation Strategies

• Negotiating charge-ups (increase in contract price per engineer) with clients.
• Measures to level out orders and improve human resource mobility to avoid temporary periods of standby for engineers.
• Active recruitment to maintain a steady increase in the number of engineers.

Supply Chain Management

Climate-Related Risks & Opportunities

UN Sustainable Development Goals

• Goal 4
• Goal 8
• Goal 9
• Goal 10
• Goal 12

Copro Holdings' four human resource creation flows ('recruitment, training, matching, retention') are closely related to these SDGs.

Awards & Recognition

• Health & Productivity Management Excellent Company 2021

Environmental Metrics

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Sustainability
• Human Capital
• Intellectual Property
• Climate Change
• Diversity & Inclusion

Environmental Achievements

• Not disclosed

Social Achievements

• Promoting the advancement of women (30% of technical employees are female)
• Promoting and actively supporting the employment of global human resources (established COPRO VIETNAM CO., Ltd. in 2021)
• Investing in human capital through various types of education and training programs

Governance Achievements

• Established a Nomination and Compensation Committee with independent outside directors and auditors
• Established a Special Committee to oversee transactions with the controlling shareholder
• Implemented a performance-linked remuneration system and stock option system for directors

Climate Goals & Targets

Environmental Challenges

• Shortage of human resources in the construction industry
• Climate change risks
• Need for further diversity in the board of directors

Mitigation Strategies

• Established a local subsidiary in Vietnam to address human resource shortages
• Risk management committee considers climate change risks and opportunities, using TCFD recommendations as a benchmark
• Nomination and compensation committee will deliberate on increasing board diversity in the future

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: TCFD

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Human Resource Development
• Work Style Improvement
• SDGs

Social Achievements

• Developing a career path for each individual technician, providing training programs and a learning environment
• Expanding the follow-up system for client companies and technicians
• Constructing programs and evaluation & compensation systems that promote the growth of technicians

Climate Goals & Targets

Environmental Challenges

• Shortage of technicians due to declining birthrate and aging population
• Difficulty differentiating from competitors in the technician dispatch market
• Need to improve productivity in sales and recruitment

Mitigation Strategies

• Investing in HR and operational standardization
• Developing a Technician Support Platform with a wide range of services to support career advancement
• Streamlining work via DX to improve efficiency and provide value to clients and technicians
• Focusing on hiring and utilizing new graduates and mid-career inexperienced people
• Dispatching skilled and young technicians as a set
• Improving matching accuracy and strengthening follow-up to improve work quality and working environment

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Governance
• Human Capital
• Climate Change
• Diversity & Inclusion

Social Achievements

• Cultivating a culture in which women can play an active role, incorporating new career advancement training for women.
• Promoting the building of the “Technician Support Platform” that actively supports engineers and technicians in forming their career paths.
• Promoting work-life balance by targeting a reduction in average monthly overtime hours.
• Improving employee engagement with a target positive response rate of 60% by FYE2026.

Governance Achievements

• Established a Nomination and Compensation Committee to ensure independence and objectivity in director nominations and compensation.
• Established a Special Committee to review important transactions with the controlling shareholder to protect minority shareholder interests.
• Conducts annual effectiveness evaluations of the Board of Directors.

Climate Goals & Targets

Environmental Challenges

• Potential impact of government carbon tax, renewable energy policies, and advancements in environmental technology on customer needs and the Group's business performance.

Mitigation Strategies

• Utilizing TCFD recommendations as a benchmark to verify the appropriateness of the Group's response to climate change and to identify growth opportunities and address risks for sustainable growth.

Supply Chain Management

Climate-Related Risks & Opportunities

Transition Risks

• Government policies (carbon tax, renewable energy)
• Technological advancements

Reporting Standards

Frameworks Used: TCFD