Promotion of Sustainability Management

We seek to achieve both economic activity and sustainability by putting our corporate philosophy into practice.

GS Yuasa Group's Sustainability

"Innovation and Growth", our corporate philosophy, is the basis of the GS Yuasa Group's Sustainability management. We believe our mission is to create “innovation” through the development of new technologies and the renewal of business processes without the restrictions of old customs. Accordingly, we aim to achieve sustainable development of business and society, by not only expanding profits, but also contributing to people, society, and the global environment. Furthermore, by responding swiftly through our business to global social issues and the needs and expectations of interested parties, we aim to become a company in which society places long-term trust and hopes for us to remain a presence into the future.

See details of GS Yuasa's philosophy

Sustainability Promotion Framework

The Group has in place a governance framework centering on the Sustainability Promotion Committee under the supervision of the Board of Directors, to promote sustainability initiatives by the entire Group from a medium- to long-term and multilateral perspective. In October 2024, the Group also established a new “Sustainability Committee” comprised of members of the Management Meeting of GS Yuasa International Ltd., its core operating subsidiary, and chaired by a Representative Director. Using these means, the Group is further enhancing its framework for the promotion of sustainability management under the leadership of the highest levels of management.

In this framework, the Company’s President supervises group-wide sustainability activities as the “Chief Commanding Officer for Sustainability Promotion,” and its corporate governance framework centering on the Board of Directors supervises and manages the appropriateness of sustainability management of the entire Group. In addition, GS Yuasa International Ltd. has established a Sustainability Promotion Committee to serve as a conference body responsible for deliberating on sustainability issues, and planning and promoting sustainability-related initiatives, to promote sustainability management throughout the Group.

The Sustainability Committee discusses important matters deliberated at the meetings of the Sustainability Promotion Committee and provides feedback to the Sustainability Promotion Committee on guidelines for implementing effective sustainability management. The Sustainability Promotion Committee utilizes this feedback as the basis for determining response measures and management resources, which are then subject to resolutions at the Boards of Directors of the Company and GS Yuasa International Ltd. before deployment throughout the Group.

When the Group discloses its sustainability information externally, the Sustainability Promotion Committee first reviews the information, followed by a final review and approval by the Board of Directors to ensure the transparency and reliability of the information to be disclosed.

Sustainability Promotion Process

The Group aims to enhance corporate value and stakeholder satisfaction by implementing a sustainability promotion process based on the corporate philosophy reflecting the Group’s enduring values.

To practice the corporate philosophy, the Group has created the Sustainability Management Policy, which determines its future direction for realizing a sustainable society and enhancing corporate value. This policy indicates the Group’s commitment to emphasize dialogue with stakeholders, contribute to solving sustainability issues, and maintain a strong business foundation.

To achieve the Sustainability Management Policy, the Group is currently operating a medium- to long-term business strategy process (including the Mid-Term Management Plan aimed at achieving the long-term vision and taking into account sustainability issues). The Group also promotes initiatives to address sustainability issues relating to its employee action guidelines (hereinafter the “CSR Policy”), which it has formulated to achieve the Sustainability Management Policy. For both policies, the Group has devised business plans to ensure economic growth and sustainability in society and the Group, taking into account the needs and expectations of stakeholders and social, environmental and economic issues. Furthermore, the Group makes continuous efforts to improve its sustainability initiatives by properly analyzing and assessing the status of responses to significant risks and opportunities related to sustainability issues and reviewing the plans as necessary. For practicing the CSR Policy, the Group has compiled the CSR Code of Conduct to define specific action standards for responsible business conduct, which has been shared with all employees.

Overview of Sustainability Promotion Process

image:Overview of CSR Promotion Process

Promoting Company-Wide Sustainability Initiatives

To promote company-wide sustainability initiatives, the Group distributes the document, the Vision Book, that clarifies our corporate philosophy to all our employees. Through the distribution of our Vision Book, which provides a clear overview of our corporate philosophy, sustainability management policies, Long-Term Vision, and action guidelines, the direction, future vision, and values of the Group’s sustainability management are shared with all our employees.

Our CSR Manual, detailing the Group’s policy on responsible corporate conduct (CSR Policy) which serves as action guidelines for sustainability management, is also distributed to all our employees. Behavioral standards underpinning the CSR Policy are clarified for employees in Q&A sections and columns covering key topics, along with a checklist for employee self-assessment of behavioral conformity with the CSR Policy. Our CSR manual, translated into local languages (six languages) that local employees can understand, has been distributed to overseas Group companies. The Group is committed to ensuring that all domestic and overseas employees are cognizant of sustainability issues related to our CSR Policy and is making efforts for the promotion of sustainability initiatives through business activities.

Management of key sustainability issues

Materiality-Related Initiatives

The Group identifies the risks and opportunities relating to the action guidelines (the CSR Policy) aimed at achieving the Sustainability Management Policy and assesses the impacts on its businesses and society to determine key sustainability issues (materiality) concerning the CSR Policy. In addition, the Group has compiled business plans to deal with materiality (the materiality response plans), taking into account such aspects as enhancement of business foundation and corporate value, and has set management indicators and targets to track the progress of the plans. The conference body (the Sustainability Promotion Committee), tasked with promoting sustainability in the Group, regularly reviews and determines materiality and the materiality response plans, taking into account the needs and expectations of stakeholders and sustainability issues. As for significant risks relating to the CSR Policy, the Group implements appropriate responses to them by utilizing its risk management system.

By managing the business process incorporating materiality into the long-term vision and the Mid-Term Management Plan, the Group seeks to improve the management quality of financial and non-financial operations and ensure sustainable growth of businesses and society.

See details of GS Yuasa’s Long-Term Vision and Mid-Term Management Plan

Materiality Specification Process

Step 1: Select risks and opportunities relating to the CSR Policy

The Group selects risks and opportunities relating to the CSR Policy, taking into account key issues of the Mid-Term Management Plan formulated based on the Sustainability Management Policy. When selecting risks and opportunities, the Group refers to international guidelines related to responsible business conduct.

Step 2: Identify significant risks and opportunities relating to the CSR Policy

The Group conducts a scoring evaluation on the risks and opportunities selected in Step 1 and identifies the risks and opportunities that may have significant impacts on businesses. Regarding the risks and opportunities with significant impacts, the Group then assesses the impacts of its business activities on society and identifies significant risks and opportunities relating to the CSR Policy.

Domains for identifying significant risks and opportunities relating to the CSR Policy (key CSR domains)

graph:Domains for identifying significant risks and opportunities relating to the CSR Policy (key CSR domains)

Step 3: Determine materiality

The Group analyzes the risks and opportunities identified in Step 2 and determines key sustainability issues (materiality) relating to the CSR Policy. The Group determines materiality, incorporating the opinions of external experts and other stakeholders, to ensure the appropriateness of materiality.

Materiality and Response Plan

A summary of the Group's materiality response plans and the impact of these plans on society and business are presented in the following table.

With respect to materiality shown in the table, we are conducting operations and management based on the measurable target management and management criteria, make ongoing improvements and perform effective maintenance and management. The details of the plans are periodically reviewed and revised according to changes in sustainability issues and the needs and expectations of stakeholders.

When carrying out the Mid-Term Management Plan, the first year of which is fiscal 2023, we formulated new materiality response plans to address significant sustainability issues. After summarizing the fiscal 2022 materiality response plans and reviewing the materiality, we established materiality response plans for fiscal 2023 and later. In these plans, we not only establish indicators and targets to manage the impact of significant sustainability issues on society, but also assess the impact on business using financial indicators.

Summary of Materiality Response Plans
(Fiscal 2023–2025)

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Materiality Activity outline Scope of application* KPI
(key performance indicator)
FY 2025 targets Impact on Society Impact on Business
Ensuring compliance Provision of legal information and promotion of compliance training Global Number of significant compliance violations None Maintenance of a sound and well-ordered society Avoidance of financial losses from compliance violations
Domestic Number of times compliance education information disseminated annually 16 times
Overseas
  1. Achievement rate of compliance training plan
  2. Achievement rate of significant compliance violation risk response plan
100%
Respect and protection for intellectual property Promotion of the use of company intellectual property rights Global Achievement ratio of plan for acquisition of patents that contribute to business growth and new business creation 100%
  • Promotion of high value-added technological innovations
  • Maintenance of a fair competitive order
  • Increased profits in conjunction with the expansion of business
  • Avoidance of financial losses arising from infringement of third-party intellectual property rights
  • Prevention of lost sales in the future due to sales of counterfeit products
Thorough avoidance of infringement third party intellectual property rights Domestic Number of incidents of third-party intellectual property rights infringements None
Elimination of counterfeit products Overseas
  1. Number of websites shut down for selling counterfeit products
  2. Number of civil lawsuits filed against makers and sellers of counterfeit products
  1. 1,000
  2. 100
Strict management of confidential information Promotion of security measures and strengthening of illegal /inappropriate access monitoring Global Cyberattack response ratio at time of detecting high security alerts 100% Achieve a safe and secure information society Avoidance of financial losses from leaks of confidential information
Domestic Information leak confirmation and response ratio at time of large data output 100%
Promotion of information security training Domestic Ratio of employees passing information security proficiency test 95% or more
Respect for individuality Promoting human rights education Domestic Achievement rate of human rights training plan 100% Raise awareness concerning respect for human rights Avoidance of financial losses from human rights violations
Overseas Achievement rate of harassment education plan 100%
Thorough management of human rights risks Domestic Harassment incident response ratio 100% Promotion of safe work environments that provide peace of mind
Respect for Diversity Women’s empowerment Domestic
  1. Ratio of women in managerial positions
  2. Ratio of women in new graduates hired for career-track positions
  3. Ratio of women in the workforce
  4. Achievement rate of training plan for female senior managers
  1. 6.0% or more
  2. 30% or more
  3. 17% or more
  4. 100%
  • Realization of rewarding workplaces
  • Promotion of participation by women in decision-making
  • Acquisition of shareholders' equity in conjunction with higher external assessment of measures regarding women's empowerment
  • Securing labor capacity by increasing the retention rate for female employees
Promotion of the employment of persons with disabilities Domestic Employment rate of persons with disabilities (average over the fiscal year) 2.7% or more Promotion of full employment Avoidance of financial losses in conjunction with failing to satisfy the statutory standard for the employment ratio of persons with disabilities
Human resources development Promotion of human resource development programs Domestic
  1. Achievement rate of training plan for development of autonomous-minded human resources
  2. Achievement rate of next-generation manager education plan
100% Promotion of skill development for young people
  • Reinforcement of organizational capabilities through the utilization of the diverse individuality of employees
  • Avoidance of human resource losses through separation
  • Enhancement of human resource performance
Enhancement of work environments and occupational health and safety Promotion of the thorough management of employees’ working hours and prevention of the recurrence of long working hours Domestic
  1. Response ratio to prevent the recurrence of long working hours
  2. Annual frequency of labor-management consultations relating to working hours
  3. Operational achievement rate of standard for number of days of paid leave taken annually
  1. 100%
  2. 12 times
  3. 100%
  • Realization of rewarding workplaces
  • Prevention of health damage
  • Promotion of safe and secure working environment
  • Avoidance of financial losses from occupational accidents
  • Avoidance of financial losses from work in excess of statutory working hours and failure to use paid leave
Overseas Number of instances of overtime work in excess of the statutory limit None
Promotion of a work-life balance Domestic Job turnover of full-time employee 2.3% or less
Thorough implementation of appropriate employment management Domestic Number of corrective recommendations from the Labor Standards Inspection Office based on spot inspections None
Promotion of health management Domestic Rate of high stress individuals 10% or less
Promotion of occupational health and safety risk management Global
  1. Number of serious occupational accidents
  2. Number of accidents resulting in missed work
  3. Number of workers not meeting internal blood lead concentration management standards
  1. None
  2. 28 or less
  3. None
Provision of high-quality products Promotion of quality improvement and strengthening of quality communication Global
  1. Achievement rate of targets for claims and in-process defects
  2. Number of serious product accidents
  1. 100%
  2. None
  • Improvement in energy efficiency
  • Responses to natural resource depletion
  • Reduce waste generation
  • Creation of highly reliable and robust infrastructure
  • Development of a safe and secure society
  • Reduction of financial losses from quality defects
  • Expansion of profits in conjunction with promotion of services
  • Avoidance of financial losses from the occurrence of product accidents
Reinforcement of product safety management Global
  1. Achievement rate of product safety-related incident reduction target
  2. Achievement rate of product safety education plan
100%
Reinforcement of service provision Domestic Achievement rate of service promotion project plan 100%
Promoting environmental protection Promotion of effective use of water resources Global Ratio of reduction of water use (compared with FY 2018) 15% or more
  • Elimination of water shortage problems
  • Improvement in energy efficiency and resource efficiency
  • Climate change mitigation
  • Prevention of water pollution and air pollution
  • Reduction of natural resource consumption
  • Reducing waste generation
  • Avoidance of loss of sales opportunities due to delayed responses to issues concerning water security, carbon neutrality, and a recycling-oriented society
  • Avoidance of financial losses from the occurrence of environmental accidents
Contribution to realization of low-carbon society Global Ratio of reduction of CO2 emissions (compared with FY 2018) 15% or more
Prevention of environmental pollution Global Number of major environmental accidents None
Improvement in ratio of use of recycled materials in products provided to markets Global Ratio of recycled lead used as lead raw materials in lead-acid batteries 70% or more
Developing and popularizing environmentally considered products Expansion of market for GS Yuasa products contained in products contributing to the curbing of global warming Global Percentage of environmentally considered products in total sales of all products 45% or more
  • Improvement in energy efficiency
  • Reduction of natural resource consumption
  • Climate change mitigation
  • Avoidance of loss of sales opportunities due to delayed responses to carbon neutrality
  • Increased profits from expanded sales of environmentally considered products
Responsible procurement promotion Responses to responsible mineral procurement Global Achievement rate of responsible mineral survey plan 100%
  • Curtailment of the provision of funding to armed groups
  • Realization of sustainable supply chains
Avoidance of financial losses from occurrence of supply chain CSR risks
Management of supply chain CSR risks Global Achievement rate of supplier CSR issues improvement plan 100%
Domestic
  1. Achievement rate of internal education plan concerning responsible procurement
  2. Achievement rate of supplier education plan concerning responsible procurement
100%

The scope of application may not
cover all Group companies.

Refer here for detailed information concerning
materiality response plans