In 2016, the Nabtesco Group established the “CSR Basic Policy” with the aim of promoting sustainability in a more systematic manner. The “CSR Basic Policy” explicitly states that the Group strives to address its material CSR issues by implementing The Nabtesco Way in its effort to fulfill corporate social responsibilities in order to meet stakeholders’ demands and expectations.

To facilitate sustainability management, Nabtesco established its CSR Committee under the direct supervision of the CEO. With the Corporate Communications Department serving as the committee’s administrative arm, the Committee convenes at least twice a year. Its chairperson and committee members are selected from among the management team members, including directors, and its meetings are attended by the managers of relevant departments.
The Committee formulates policies for a range of issues, and discuss and decides important issues, while also conducting regular reviews and evaluations regarding the main sustainability-related activities reported by departments. The Committee reports its activities to the CEO while simultaneously providing reports and suggestions for relevant meetings.

Committee members

• Related linkComposition of related committees

The policy to “Ensure management transparency” and “Provide safety, comfort and a sense of security” upheld under the CSR Basic Policy represents the Group’s material issues. By incorporating the concept of materiality into the CSR Basic Policy, we are strategically tackling CSR issues that are important to the Group as well as to its stakeholders.

General Category	ESG Category	Materiality （Material CSR Issues）	Major SDGs of Relevance
Ensure management transparency	Governance (G)	Strengthen corporate governance
		Promote risks management and compliance behavior
		Ensure proactive dialogue with stakeholders
comfort and safety, Provide a sense of security	Society (S)	Enhance customer satisfaction Ensure quality and safety
		Develop human capital and promote workplace diversity Provide safe and comfortable workplaces
		Respect human rights Prevent corruption
		Fair, proper and transparent procurement activities
		Local community development
	Environment (E)	Countermeasures for climate change
		Environmentally friendly manufacturing
		Reduction of environmental impact through products and services
		Recycling, reuse and remanufacture of products

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We identified materiality for the first time in 2014. Since then, we have been reviewing them regularly to reflect trends in international society, stakeholders’ expectations and other factors.

Step 1: Listing issues

We identified the issues faced by the Nabtesco Group and grasped what our stakeholders needed based on our customer CSR questionnaire results, various guidelines on sustainability*¹ and information provided by ESG research organizations*². We then listed the issues that need to be tackled for the Nabtesco Group’s sustainable growth.

• *1 ISO 26000 (Guidance on organizations’ social responsibility)/International Integrated Reporting Council (IIRC) International Integrated Reporting Framework/Sustainability Accounting Standards Board (SASB) SASB Standard/Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines/Sustainable Development Goals (SDGs)
• *2 RobecoSAM/FTSE4Good/Sustainalytics/VigeoEiris

Step 2: Deciding on the materiality of each issue

Next, we assessed the materiality of the issues identified in Step 1 from the perspectives of “importance for stakeholders” (vertical axis) and “importance for our company” (horizontal axis) and specified those assessed as particularly material to be included among our material CSR issues. Regarding “importance for stakeholders,” we referred to the evaluation made by ESG research organizations, while for “importance for our company,” we decided on priorities based on relevance to business plans of our operating and corporate departments and divisions.

Step 3: Selection of material CSR issues

Based on the opinions given by external experts, we reexamined the issues deemed important in Step 2. Then, finally, the Board of Directors selected the material CSR issues through discussion.

We are in the process of reviewing materiality in sync with the formulation of the Group’s next long-term vision and medium-term management plan.

Participation in the United Nations Global Compact

The United Nations Global Compact (UNGC) is an international initiative that calls on companies and organizations to demonstrate responsible and creative leadership and take action as good corporate citizens for the achievement of sustainable growth. Signatories of the UNGC are required to comply with the “ten principles” set in the areas of human rights, labor standards, the environment, and anti-corruption, and implement voluntary measures with a strong commitment from their senior management.

Nabtesco signed the UNGC to show its support for the initiative in April 2014 and is also a member of Global Compact Network Japan (GCNJ). We have been proactively participating in symposiums and study groups organized by the GCNJ, including the study groups on ESG, reporting, environmental management, supply chains, anti-corruption, disaster risk reduction (DRR) and the WEPs*. Through these events, we interact with other participating companies and learn from advanced examples how to better foster CSR-oriented management at our company.
*WEPs: Women’s Empowerment Prnciples

Measures for SDGs (Sustainable Development Goals)

We have taken proactive measures for achieving the Sustainable Development Goals (SDGs). By setting targets associated with those goals among the 17 SDGs that have strong relevance to our material CSR issues, and thereby addressing materiality, we are striving to realize a more sustainable society.

• Related linkAbout SDGs

Science Based Targets（SBT）Initiative

Our long-term greenhouse gas emissions goal was approved in 2017 by the Science Based (SBT) Initiative as a science-based target.

The SBT Initiative was created in 2015 jointly by the CDP, the World Resources Institute (WRI), the World Wide Fund for Nature (WWF) and the UN Global Compact for the purpose of promoting greenhouse gas emissions goals in line with scientific initiatives aimed at holding the temperature rise to less than 2 °C above pre-industrial levels.

Task Force on Climate-Related Financial Disclosures（TCFD）

In 2019, we expressed our endorsement of the recommendations made by the Task Force on Climate-Related Financial Disclosures.

In June 2017, the TCFD announced its recommendations on how voluntary disclosures should be made, with the aim of ensuring that the Financial Stability Board (FSB), an international organization whose members include representatives from central banks, financial supervisory authorities, and finance ministries of major countries and regions, among other institutions, better understand and disclose the financial impact of the risks and opportunities posed and provided by climate change.