Sustainability Management

In 2021, to further promote initiatives aimed at making a sustainable society a reality, we established the Asahi Kasei Group Sustainability Policy.

Asahi Kasei Group Sustainability Policy

The Asahi Kasei Group is contributing to life and living for people around the world. We strive for two mutually reinforcing aspects of sustainability: “contributing to sustainable society” and “sustainable growth of corporate value.” By creating value for “contributing to sustainable society” we seek to gain high earnings that lead to “sustainable growth of corporate value" which enables us to make further contributions in a virtuous cycle.

In order to achieve this, we pursue the optimal corporate governance while practicing the following.

Value creation through contribution to sustainable society

Resolving issues for People and the Earth through our high value-added businesses (Care for People, Care for Earth)
Leveraging our strengths of diversity and capability to change for the creation of value (Connect, Communication, Challenge)

Responsible business activities

Complying with laws/regulations and respecting international standards regarding business activities (Compliance)
Prioritizing ESH (environment, safety, and health), human rights, and quality assurance throughout all of our activities
Performing appropriate information disclosure and dialogue with our stakeholders

Empowerment of personnel

Respecting diversity,equity and inclusion
Encouraging each employee’s growth, performance, and challenging spirit

Asahi Kasei Group Sustainability Policy

Our Group Mission is "contributing to life and living for people around the world," and we have grown by continually contributing to solutions for society. Our commitment has remained constant ever since our founding with the aim of improving people’s standard of living.
Today, discussions about achieving sustainability are taking place around the world. Since sustainability is a challenge that concerns people and the global environment, we believe that the pursuit of “living in health and comfort” and “harmony with the natural environment” as set forth in our Group Vision will lead to sustainability.
"Sustainable growth of corporate value" in conjunction with "contributing to sustainable society" is also important." Contributing to sustainable society" leads to earnings which enhance the corporate value of the Asahi Kasei Group, which in turn enables further "contributing to sustainable society."

To make this virtuous cycle a reality, we will strive to create value by contributing to a sustainable society, conduct our business activities in a responsible manner, and promote the empowerment of our employees based on our approach of “Care for People, Care for Earth.”
Our ultimate aim is to continue to proactively contribute to the world as a leader in solving challenges for society, carrying on the commitment we have had since the founding of our company.

Message from the Head of Sustainability Strategy Planning

Our Group Mission is “We, the Asahi Kasei Group, contribute to life and living for people around the world.” while our Group Vision is to realize “living in health and comfort” and “harmony with the natural environment.” The Asahi Kasei Group Sustainability Policy sets out our management approach to achieving these things, based on two pillars of a mutually reinforcing cycle of sustainability: contributing to sustainable society and sustainable growth of corporate value. Under this policy in fiscal 2023, we promoted the reduction of GHG emissions by focusing on low-carbon energy, and by developing hydrogen and other businesses and technologies that are expected in a sustainable society. In addition, we have committed to people-related initiatives, such as human rights, DE&I, and health and productivity management. We have also made steady progress with other important initiatives related to responsible business activities, such as environmental protection, process safety, occupational health and safety, quality assurance, and legal compliance. Although the global state of affairs is becoming more complex with increasing challenges, we will remain steadfast as we continue in fiscal 2024 toward realizing a sustainable society with the understanding and cooperation of everyone involved.

Asahi Kasei Corp.
Executive Officer
Senior General Manager, Sustainability Strategy Planning Dept.
Tatsuhiko Tokunaga

Management Framework

The Asahi Kasei Group considers sustainability as a pillar of management and incorporates it into both its medium-term and annual management plans, in addition to discussing it at Board of Directors meetings. We have also established a Sustainability Committee to promote sustainability group-wide.
The Sustainability Committee consists of the President, Executive Officers for Business Sectors, and Executive Officers for business administration and technology functions, and is responsible for disseminating information, orienting sustainability-related activities, and so on. Particularly important activity results and deliberations of the Sustainability Committee are reported to the Board of Directors, which oversees the committee. The Sustainability Committee coordinates with the Risk Management & Compliance Committee, the ESH & QA Committee, and the DE&I Committee, which all handle more technical and specific matters.
All four of these committees are chaired by the President of Asahi Kasei. We have also established the Human Rights Committee and the Global Environment Committee as subcommittees of the Sustainability Committee.

Framework for Sustainability Strategy (as of August 1, 2024)

About the Sustainability Committee

Purpose

To share information on sustainability
To deliberate on action policies
- 1.Policies for promotion
- 2.Internal and external dissemination
- 3.Instilling ideas throughout the company (enhancing mindsets)
- 4.Key challenges (plastics, Environmental Contribution Products)

Constituent Members

Chair: President
Members: Executive Officers for the 3 Business Sectors
Executive Officer for technology functions
Executive Officer for business administration functions
Secretariat: Sustainability Strategy Planning Dept.

Asahi Kasei Group efforts for the SDGs

Transforming our world: the 2030 Agenda for Sustainable Development was adopted by the UN Sustainable Development Summit in September 2015. The agenda includes 17 Sustainable Development Goals (SDGs) and 169 targets such as ending poverty and inequality, and taking action on climate change.
Through its diverse array of businesses and technologies, the Asahi Kasei Group contributes to achievement of the SDGs in accordance with the Group Vision of providing new value to society by enabling “living in health and comfort” and “harmony with the natural environment.”

Asahi Kasei Group's Materiality

In fiscal 2017 we designated the priority issues and subjects to address as the materiality of the Asahi Kasei Group. Since then, as climate change has progressed and sustainability-related trends have accelerated worldwide, we reviewed our materiality in 2021 and added "Decarbonization" and "Circular economy" as matters of the highest importance.

Identifying Our Materiality

1.Identifying Issues
We referred to international guidelines including ISO 26000 and the GRI Standards, as well as the evaluation items used by major ESG evaluation organizations (FTSE, etc.), to identify issues according to the demands of societies and our mission, vision, and values.
2.Determining the Impact
We assessed the level of impact on both society and the Asahi Kasei Group and mapped it onto two axes.
3.Evaluating Validity
We confirmed the validity of the plan by examining it from a variety of perspectives, such as through deliberations among divisional managers, discussions with other companies, and interviews with outside directors.
4.Deliberation and Approval
After deliberation by the Management Council, the proposal was approved by the Board of Directors.

The relationships between this materiality and the sustainable development goals (SDGs) are shown in the following table. We will continue to advance our initiatives while incorporating the perspectives of various stakeholders.

Materiality List

Theme	Materiality	Related SDGs	Supervising organization (Joint supervision: Sustainability Strategy Planning Department)	Main KPIs	Target	Results
Coexistence with the Environment We position initiatives for the global environment as important issues, and we are working on measures regarding climate change, preventing pollution, development of a circular economy, and other initiatives. Using our diverse technologies, we will also develop materials and products that contribute to conserving energy and reducing CO₂ emissions.	Global environment^*		Strategic Business Units and Core Operating Companies Corporate Research & Development	Environmental Contribution Products	(1)At least double our GHG reduction contribution by FY2030 (compared to FY2020) (2)Increasing the proportion of sales of Environmental Contribution Products (total sales excluding Health Care sector)	(1)FY2023: 40% increase (2)FY2023: 29%
	Decarbonization		Corporate ESH, Strategic Business Units, and Core Operating Companies Corporate Research & Development	GHG emissions	FY2030: Reduction of 30% or more (compared to FY2013) FY2050: Carbon neutral	FY2023: approximately 38% reduction
	Circular economy		Corporate ESH, Strategic Business Units, and Core Operating Companies Corporate Research & Development	―	―	―
	Wastewater		Corporate ESH	Number of accidents involving environmental pollution and number of significant issues	FY2023 Target: Maintain zero environmental accidents and serious environmental incidents Zero environment incidents (air, water, etc.)	FY2023 Results: Environmental pollution incidents/significant issues: None Problems with water, air quality, etc.: 0 Freon leaks: 9
	Industrial Waste		Corporate ESH	―	FY2023 Target: Reduce industrial waste and promote recycling Reduction of industrial waste emissions from products using plastics, etc. and promotion of recycling, etc.	FY2023 Results: Ascertained current amount of plastic waste generated and processed based on the Act on Promotion of Resource Circulation for Plastics Failed to increase recycling rates for industrial waste of products using plastic, etc. (FY2022: 47.4% versus FY2023: 46.6%)
	Biodiversity		Corporate ESH	Awareness-raising Activities	FY2023 Target: Promote preservation of biodiversity Promote initiatives in line with the next National Biodiversity Strategy of Japan Promote awareness-raising activities for employees in relation to biodiversity	FY2023 Results: Participated in the 30by30 Alliance, “Asahi Woods of Life” in Fuji was certified. A Machimori animal observation event was held as an initiative to familiarize employees with nature.
Living in health and comfort We will contribute to healthy and comfortable lifestyles and affluent living with our distinctive products and technical capabilities.	Health and longevity^*		Strategic Business Units and Core Operating Companies Corporate Research & Development	―	―	―
	Comfortable life^*		Strategic Business Units and Core Operating Companies Corporate Research & Development	―	―	―
Basic Activity We will strengthen the base for business development, leading to the creation of new value.	Corporate Governance		General Affairs	Effectiveness assessment and improvement	―	―
	Compliance/sincerity		General Affairs	―	―	―
	Risk Management		General Affairs	―	―	―
	Safety/quality		Corporate ESH/Corporate Quality Assurance	Serious process safety accidents Lost time frequency rate	FY2023 Target: Zero serious process safety accidents Zero process safety accidents Process safety accident intensity: 0.5 or less (average)	FY2023 Results: Serious process safety accidents: None Process safety accidents: None Process safety accident intensity: 0.46
	Human rights		Human Resources/Corporate Procurement & Logistics	―	―	―
	Human Resources		Human Resources	―	―	―
	Diversity,equity and inclusion		Human Resources	Proportion of women in managerial positions who play a leading role	Proportion of women working as managers and Group Masters FY2030 Target: 10%	Proportion of women working as managers and Group Masters June 2024 result: 4.4%
	Diversity,equity and inclusion		Human Resources	Number of Group Masters	FY2024 Target: 360	2023 Result: 347
	Supply chain management		Corporate Procurement & Logistics	Administered CSR Procurement Questionnaire	―	―
	Communication with stakeholders		Investor Relations/Human Resources/General Affairs and others	―	―	―
	Community fellowship		Corporate Communications	Amount of activity (in monetary terms)	―	―

*Contribution through business

Participation in initiatives (major initiatives)

(as of August 2024)

Global Compact	The Asahi Kasei Group supports the United Nations Global Compact. UN Global Compact
GX League	The GX League is an initiative led by the Ministry of Economy, Trade and Industry (METI) involving efforts to transform the overall economic system through measures such as decarbonization and carbon neutrality. Asahi Kasei is a member of the GX League. GX League
Challenge Net Zero Carbon Innovation (Challenge Zero)	Challenge Zero is an initiative promoted by the Japan Business Federation (Keidanren) in coordination with the Japanese government to support companies and groups in their efforts to achieve a decarbonized society. Asahi Kasei supports this initiative and has announced specific efforts and policies: Challenge Zero
Clean Ocean Material Alliance (CLOMA)	The Clean Ocean Material Alliance (CLOMA) is a platform established to accelerate innovation by strengthening collaboration among a wide range of stakeholders across industry sectors amid a need to implement worldwide initiatives to overcome the marine plastic litter problem, a global-scale challenge. Clean Ocean Material Alliance
Battery Association for Supply Chain (BASC)	The Battery Association for Supply Chain (BASC), established as a general incorporated association on April 1, 2021, is an organization engaged in activities such as the international standardization of the battery supply chain (industries related to battery materials, components, and raw materials) and the creation of a battery ecosystem, with the aim of achieving a decarbonized society. BASC
RE100	RE100 is an international collaborative initiative consisting of companies committed to running their business operations on 100% renewable energy. As a member of this initiative, Asahi Kasei Homes became the first Japanese house builder to achieve this goal in fiscal 2023. RE100
Keidanren Biodiversity Declaration Initiative	The Keidanren Biodiversity Declaration Initiative is a support effort by the Japan Business Federation (Keidanren) to promote autonomous, active efforts by companies to partake in biodiversity preservation activities, with the aim of achieving harmony between the environment and the economy. Asahi Kasei supports this initiative and has announced specific efforts and policies. Keidanren Biodiversity Declaration Initiative
Pinfa (Phosphorus, Inorganic & Nitrogen Flame Retardants Association)	Through Asahi Kasei Europe GmbH , its European headquarters, Asahi Kasei has become the first Japanese resin manufacturer to join Pinfa (Phosphorus, Inorganic & Nitrogen Flame Retardants Association), an organization dedicated to improving the safety and lowering the environmental impact of both non-halogenated flame retardants and plastic products that use non-halogenated flame retardants. Pinfa
Clean Fuel Ammonia Association	Ammonia shows promise as an energy carrier for hydrogen. This association aims to establish a value chain from supply to utilization of CO₂-free ammonia through technology development/evaluation, economic evaluation, policy recommendations, international collaboration, and other efforts. Clean Fuel Ammonia Association
Japan Hydrogen Association (JH2A)	The Japan Hydrogen Association (JH2A) advances global collaboration in the hydrogen field as well as the creation of hydrogen supply chains. As a chemical manufacturer that utilizes hydrogen, Asahi Kasei will take an active role in offering proposals in the Association's working group activities with regard to issues that should be addressed to generate and expand demand for hydrogen. Japan Hydrogen Association (JH2A)
Hydrogen Council	The Hydrogen Council is a global initiative that aims to promote the use of hydrogen to encourage the transition to clean energy for the realization of a sustainable society. As a Steering Member, Asahi Kasei works together with various companies and organizations in the supply chain, helping to promote the use of hydrogen while building a future business. Hydrogen Council
Hydrogen Europe	Hydrogen Europe is an organization that promotes the building of a global hydrogen industry in Europe and beyond, with the aim of realizing a zero-emission society. As a supplier of water electrolysis equipment, Asahi Kasei will sponsor this activity and actively make recommendations. Hydrogen Europe Home
30by30 Alliance	Asahi Kasei and Asahi Kasei Homes are participating in the 30by30 Alliance for Biodiversity, a program established by the Ministry of the Environment to conserve natural environments, with the goal of conserving biodiversity in 30% of Japan’s land and sea areas by 2030. 30by30 Alliance
Led by the UN Development Programme Business Call to Action (BCtA)	Business Call to Action (BCtA), a multilateral alliance led by the United Nations Development Programme (UNDP), challenges companies to advance core business activities that contribute to the achievement of the Sustainable Development Goals (SDGs). Asahi Kasei joined with an initiative to support the fiber industry in India through the creation of a comprehensive value chain for Bemberg™ cupro. Business Call to Action (BCtA) Asahi Kasei Case Study (in Japanese)
CPs (Circular Partners)	The Ministry of Economy, Trade and Industry (METI) established CPs to organically link government, industry, and academia in an ambitious and pioneering partnership aiming to realize a circular economy that maximizes added value while effectively and cyclically utilizing resources. Asahi Kasei participates in CPs. Circular Partners website (in Japanese)
National movement (Deco Actions) to create new, affluent lifestyles that lead to decarbonization	Deco Actions (decarbonization actions) is a new national movement launched in October 2022 to encourage behavioral change and lifestyle transformation with the aim of realizing the goal of carbon neutrality in 2050 and GHG emissions reduction targets in 2030. Asahi Kasei has declared its commitment to “Deco Actions.” Deco Actions website (in Japanese)
Declaration for Partnership Building	In 2022, Asahi Kasei endorsed the Declaration for Partnership Building in support of the Council for Promoting Partnership Building to Open Up the Future, promoted by the Cabinet Office, the Small and Medium Enterprise Agency, and other organizations. Asahi Kasei Homes, Asahi Kasei Pharma, and Asahi Kasei Medical have also announced their endorsement of the Declaration for Partnership Building. Declaration for Partnership Building portal site (in Japanese)
White Logistics Movement	The White Logistics Movement is aimed at ensuring stability in logistics needed for people's daily lives and industrial activity and contributing to economic growth in response to the truck driver shortage, which continues to intensify. The Ministry of Land, Infrastructure, Transport and Tourism, the Ministry of Economy, Trade and Industry, and the Ministry of Agriculture, Forestry and Fisheries are the advocates of the movement. Asahi Kasei has made a statement of voluntary action endorsing the movement and is working to improve logistics. White Logistics Movement (in Japanese)
Responsible Care (RC) Global Charter	The Responsible Care (RC) Global Charter is a voluntary action policy for the chemical industry enacted by the International Council of Chemical Associations (ICCA) to further enhance and strengthen RC activities worldwide. RC activities are proposed and promoted by the Japan Chemical Industry Association, with companies that handle chemical substances acting voluntarily to ensure that they protect the environment, health and safety at each stage from development, manufacture, distribution, use, and final consumption of the end product through to its disposal, while taking measures to gain greater public trust through disclosure and communication. We endorsed this action policy when we signed a Declaration of Support for the RC Global Charter in 2008, and again in November 2014, when we signed a Declaration of Support for the Revised RC Global Charter, which was revised in May 2014. Companies that signed the RC Global Charter Declaration

Membership in organizations (main organizations)

Name of organization	Asahi Kasei's role
Japan Business Federation (Keidanren)	Vice Chair Chair of Environment Committee Chair of Committee on Social Security
Japan Chemical Industry Association (JCIA)	Director
Plastic Waste Management Institute	Chairman

Relationships with Stakeholders

The Asahi Kasei Group’s business operations depend on relationships of trust with our stakeholders. We believe that corporate value is raised by understanding the requirements and meeting the expectations of various stakeholders such as customers, shareholders and investors, business partners, local communities, the general public, and employees.
We provide many opportunities for communication to enable our business operations to be improved through dialog with stakeholders.

Communication with stakeholders

Main stakeholders	Basic premises	Main opportunities for communication
Customers	We believe that it is by maintaining customer satisfaction and providing reliable and enjoyable products and services that we contribute to society.	Face-to-face discussion by marketing and sales personnel Providing product and service information on websites Taking inquiries via telephone, website, etc.
Shareholders and investors	We strive to disclose information in a timely and fair manner to enable our domestic and international investors to gain an accurate understanding of the Asahi Kasei Group.	Briefings and meetings with securities analysts and institutional investors Seminars for individual investors Website disclosure of information Taking inquiries via telephone, website, etc. Shareholders meeting
Suppliers	A relationship of mutual trust with our suppliers is fostered through fair and principled purchasing practices based on regulatory compliance and respect for the environment and human rights.	Safety discussion forums CSR Procurement Questionnaire Whistleblower System (Compliance Hotline)
Local communities and the general public	We work to honor and respect the local culture of each community where our operations are based, and to maintain effective dialog and communication with community members.	Periodic community dialog meetings Community outreach initiatives
Employees	The Asahi Kasei Group considers fulfilling and satisfying working conditions and workplace culture, in which employees feel motivated to achieve and take pride in their career, to be a key to business performance.	Training and interviews Discussion and interaction with management Internal magazine and intranet Whistleblower System (Compliance Hotline) Engagement Surveys, etc.