Sustainability

Seven Promises and Materialities

Identified materialities to achieve our ambitions

We have summarized our sustainability approach as Sustainable Management and established Seven Promises with our stakeholders to promote this approach. To put these Seven Promises into action, we have identified the gaps between our current status and the targets of VISION 2030 from a long-term perspective. In addition, we have identified materialities that will have a particularly large impact on our stakeholders and KH Neochem. Specific initiatives and milestones for these materialities during the period of the 4th Medium-Term Business Plan have been set as KPIs.

We will fulfill our Seven Promises to promote sustainable management by establishing KPIs and working diligently toward addressing these materialities. Progress on KPIs is periodically monitored by the Board of Directors, and measures will be taken if any items are not being achieved. We will continuously disclose the status of achievement of these KPIs and use this as a basis for enhancing constructive dialogue with our stakeholders.

Seven Promises and Materialities

Seven Promises
Materialities
1
We will develop businesses that help resolve social issues
  1. Expansion of social problem solving businesses centered on strategic domains
  2. Promotion of innovation
  3. Strengthening of intellectual property strategies to strengthen the foundation for growth
2
We will conduct business conscious of reducing our impact on the environment
  1. Improvement of energy efficiency and reduction and management of CO2 and other emissions
  2. Proper management of chemical substances
3
We will strive to secure trust through safe and stable operations
  1. Safety and disaster prevention at plants with consideration of the local region
  2. Responsible and stable supply to customers
4
We will practice management transparency with high ethical standards
  1. Strengthening of corporate governance and risk management
  2. Compliance
  3. Transparent and responsible communication with stakeholders
5
We will provide a lively work environment that motivates and rewards diverse human resources
  1. Health and safety of employees
  2. Human Resource Development and Recruitment to support Sustainable Management
  3. Improvement of employee engagement and creation of comfortable workplaces to improve productivity
6
We will promote responsible supply chain management
  1. Promotion of Corporate Social Responsibility (CSR) procurement
7
We will strengthen our earning power
  1. Optimization of business portfolio for stable profit generation
  2. Pursuit of higher productivity and efficiency at plants

List of KPIs

KPIs for each materiality
Targets for 2024
1
Rate of increase in sales volume of refrigeration lubricants raw materials (compared to 2021)
over 17% increase
2
3
Number of collaborations with external organizations in research and development
over 10 per year
4
Greenhouse Gas (GHG) emissions (CO2 equivalent)
30% reduction from FY2017 level (2030 target)
4
Energy intensity
1% or more improvement per year
5
Volume of final landfill disposal of industrial waste
1% or less of waste generated
6
Systematic introduction of Smart Industrial Safety
Production achieved as planned
7
Production plan achievement status
Implementation as planned
8
Identification of important risks by using risk maps and implementation of countermeasures
Implementation as planned
9
Number of compliance education and training sessions at all sites
over 5 times per year
10
Number of dialogues with investors
over 220 times per year
11
Number of employee accidents resulting in lost workdays
0
12
Ratio of female employees in managerial career track positions
over 15%
12
Rate of recruited personnel leaving work (in less than 3 years)
less than 10%
13
Engagement survey score
10% or more improvement
13
Rate of taking of annual paid leave
over 80%
14
Coverage ratio of Corporate Social Responsibility (CSR) questionnaire survey of main raw materials (based on purchase amount value)
over 70%
15
Operating income of core products (performance materials + electronic materials)
over 14.1 bn yen
15
ROE
over 15%
16
Improvement of productivity through introduction of advanced control systems
Introduced as planned and productivity increased
16
Status of progress in DX related installations
Implementation as planned

Note: Materiality No. 15 is consolidated, while No. 1-14 and 16 are not consolidated. Operating profits in results by business field and administrative expenses common to the Group are not allocated upon calculation.

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