Diversity and a comfortable working environment

Policy and Basic Approach
System
Targets and Results
Initiatives

Policy and Basic Approach

Our Approach to Diversity

In order to become a company which brings happiness and delight to society under the KAYAKU spirit corporate vision, we believe it is vital to have a workplace environment that accepts diversity and a diverse range of opinions and ideas. As such, we place importance on the diversity of our organization, based on acceptance of, and mutual respect for, one another regardless of sex, age, nationality, ethnicity, religion, disability, skin color, culture, ideas, convictions, political opinions, and sexual orientation. We are also working to guarantee diversity through a structure which offers equal opportunities to all employees with respect to recruitment, advancement, promotion, treatment and education. Through such initiatives do we aim to guarantee human resource diversity and, through mutual acceptance of that diversity, foster a comfortable and rewarding workplace environment through promotion of free and open discussion, thereby increasing employee engagement.

Internal Environment Preparation Policy

System

Human Capital (System)

Targets and Results

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Key sustainability issues	Corresponding SDGs	Action plans	Indicators（KPI）	FY2025 Targets	Results		FY2024 Initiative-related Topics
Key sustainability issues	Corresponding SDGs	Action plans	Indicators（KPI）	FY2025 Targets	FY2023	FY2024	FY2024 Initiative-related Topics
Maintaining and Expanding Employment, Developing Human Resources, and Respecting Human Rights		Promoting diversity and inclusion through the recruitment of diverse human resources, effective HR assignment and exchanges Pass down and strengthen technical capabilities in monozukuri (manufacturing) and achieve globalization in human resources through ongoing human resource development	Percentage of female employees in management posts^*	(Non-consolidated) 10% or higher	(Non-consolidated) 8.8%	(Non-consolidated) 8.3%	In each workplace, we are selecting female candidates for managerial positions, confirming their managerial intentions via interview, and delivering systematic development training. In order to change attitudes, we have also held a panel discussion involving female managers and urged women to challenge for management roles. We have also increased the percentage of women recruited. (New female hires are up by 9.2 points on the previous FY, while career female hires are up by 4.3 points) With the aid of specialist support and advice, we are preparing better work introductions and working environments for disabled people, and continue to promote disabled hires as well as expanded job opportunities. Our actions going forward will see us fix Key Initiative Business Sites on which to expand recruitment and prepare a suitable working environments. We shall also link up with a specialist support school to further boost recruitment and continually strengthen working environments
			Percentage of employees with disabilities	(Non-consolidated) Achieve legal minimum employment rate	(Non-consolidated) 1.93%	(Non-consolidated) 2.11%

*Target values at the end of FY2024

Initiatives to Promote More Active Roles for All Employees

We aim to achieve a sustainable society and increased corporate value by creating a workplace climate as rewarding as it is work-friendly, and by ensuring employee diversity without regard for age, gender, academic record, nationality or disability considerations. To that end, we have fixed the following action plan.

1. Period Covered

2024-04-01 to 2026-03-31 (2 years)

2. Our Company Issues (Extracted from items which should be publicly disclosed according to the Act on the Promotion of Women’s Active Engagement in Professional Life)

The proportion of female workers recruited is low
The proportion of female subsection chiefs is low
The proportion of women in managerial roles is low
The proportion of women in executive roles is low
There are few examples of women switching occupations (their work roles are limited)
Disparities exist between male and female wages
Take-up rates for paternity leave are lower than those for maternity leave
Take-up rates for paid leave among managers and men are low

3. Targets

At least 10% of E-Class managerial roles to be filled by women
To maintain paid leave take-up rates of at least 70%

4. Initiative Details and Implementation Timings

The drive towards having at least 10% of E-class managerial roles filled by women
1. The E-class managerial appointments system will see women selected from each business site
  - Candidates are to be selected from their business sites in August 2024
  - The run-up to that will see a panel discussion held on the above, featuring female E-class managers, with the period to reform organizational thinking
  set for June-July 2024
2. Conducting systematic development guidance sessions to increase applicant numbers for E-class management positions
  - Conducting careers training sessions for selected participants, confirming their intentions via interview and reviewing job contents
  - Initiative commenced in June 2024 and to be linked to better results for initiative ① in FY2025
3. Working towards improving the proportion of female workers being recruited
  - Initiative commenced in June 2024, ahead of the FY2025 Recruitment Plan
4. Examining possible expansion of the work-from-home system to help employees better balance their home and work activities
  - Possible expansion to new workplaces and job categories
  - Possible expansion to five days per month for childcare, nursing care, or fertility treatment purposes
  - Exploration of the above commenced in June 2024
Initiatives to maintain the paternity leave take-up rate at 70% or higher
1. Getting management and male employee paid leave take-up rates to 70% or higher
  - Drawing up a “Five Days or More” Paid Leave Take-up Plan and sharing that plan within workplaces
    (The Plan also includes Anniversary Leave and will be released to each department by October 2024)
2. Exploring a possible increase of Paid Leave Promotion Days for each business site
3. Systematically adding to annual paid leave
4. Making use of internal company bulletins and the intranet to call for periodical promotions of paid leave
  - Initiatives ② and ④ to run from September 2024

Performance Report (FY 2024)

Action Plan for Next-generation Development Support Measures

Based on the Act for Measures to Support the Development of the Next Generation, Nippon Kayaku is promoting various initiatives under the action plan described below which aim for an employment environment designed to help employees balance work with childcare commitments, and to create a work-friendly environment for employees not engaged in childcare.
The details of the plan have been shared with labor unions, released outside the company, and diffused to all employees via the company intranet.

Next-generation Development Support Measures: Action Plan 5

To create a comfortable workplace environment which allows employees to demonstrate their ability and strike a balance between work, life and childcare, we have drawn up the following action plan.

1. Plan Period

2 years: April 1st 2025 to March 31st 2027

2. Contents

Target 1: To raise paternity leave and childcare-related leave take-up rates to over 70%.

Measures

April 2025: Utilize companywide notice boards such as the intranet to diffuse information promoting paternity leave
April 2025: Utilize companywide notice boards such as the intranet to diffuse guidance on taking up paternity leave
April 2025: Conduct training for managers of employees planning to give birth on the work requirements and basic information they need to consider

Target 2: Working hours outside of legal working hours and legal holiday working hours should not exceed 30 per month for full-time workers.

Measures

April 2025: Utilize companywide notice boards such as the intranet to diffuse information on designated No Overtime Days.
April 2025: Advisory Committee on Working Hours to explore initiatives related to working hours management.

Performance Report (FY 2024)

Initiatives

Support for Enhanced Roles for Diverse Human Resources

Promotion of Enhanced Roles for Women

We are engaged in initiatives to enhance the roles of female employees, and have fixed as a KPI the goal of having 10% of managerial posts filled by women by the end of FY2025. In addition to moving forward with ability-based recruitment and appointments free from gender discrimination, we are managing and developing female management candidates through the preparation of workplace environments and construction of organizational systems in which women can aim to further advance their careers.
As of end-March 2025, the percentage of all management posts filled by women stood at 8.3% (as compared with 8.8% at the end of FY2024). Moving forward, we will request the cooperation of each workplace in the recruitment and appointment of women to managerial positions, as well as set up Management Position Seeker Support and training for female leaders.

Supporting Enhanced Roles for Employees with Disabilities

We are also engaged in employment initiatives for those with disabilities, and as of end-June 2024, could count 50 employees with disabilities among our workforce (a disability employment rate of 2.11%). FY2024 has seen us continue with efforts to increase disabled employment rates at the Asa Plant and Tokyo’s R&D Administration Office through providing fixed recruitment period and post-recruitment support, and receiving extra support from a consulting company. As society demands that we proactively employ disabled persons, we have further advanced initiatives such as fixing key initiative workplaces, expanding recruiting, readying the internal company environment, partnering with a special support school, and setting up continuous recruitment of disabled persons. Beginning with guaranteeing the legal rate of disabled employment, we are continuously launching initiatives such as creating a rewarding work environment for disabled people in which they can output both vitality and ability, as well as opening up and expanding the range of work they can do.

Rates of disabled employees

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Indicators	Covering	Unit	2020	2021	2022	2023	2024
Disabled employees	consolidated	persons	-	-	92	68	82
Disabled employment rate^*1	consolidated	%	-	-	1.44	1.04	1.26
Disabled employment rate^*2	non-consolidated	%	2.01	2.00	1.98	1.93	2.11
(Statutory employment rate)	non-consolidated	%	2.2	2.3	2.3	2.3	2.5

*1Disabled employee numbers have been removed from the total of regular employees, contracted employees and part-time employees, hence calculation methods differ from those used for statutory employment rates.
*2Each year's data is accurate as of Jun 1st

Supporting Enhanced Roles for Employees over the Statutory Retirement Age (Senior Partners)

Our current system for reemployment of employees who have reached the company retirement age (Nippon Kayaku Senior Partner System) was introduced in April 2006. The purpose is to give post-retirement-age employees of sound mind and body and with the desire to work a chance to continue fulfilling company roles by making ample use of the knowhow and experience they have cultivated over their long careers. We ask each individual to name their preferences as to work location, work contents and working style, and are pleased to report that since the system came in, almost 100% of applicants were employed on the terms they desired. Most of these applicants then went on to serve us until 65.

Employment of retired employees

Scroll sideways for an overview of the table below.

Indicators	Covering	Unit	2020	2021	2022	2023	2024
Employment of retired employees	non-consolidated	persons	42	22	29	30	33
Employment rate of retired employees	non-consolidated	%	95.4	84.6	85.2	85.7	68.75

LGBTQ+-related initiatives

At the Nippon Kayaku Group, we are aiming to create a working environment in which everybody can be themselves while on the job. In order to deepen understanding of LGBTQ+matters, we are setting up an Ethics Managers Liaison Committee as well as e-learning training on LGBTQ+ themes. Our Human Resource Management Meeting is also conducting training on The Act on Promoting Public Understanding of Diversity in Sexual Orientation and Gender Identity.

Global Human Resources Exchanges

One of our diversity promotion initiatives is to ensure that not only Japanese employees but local staff in our overseas Group companies can play bigger roles in a global environment. Through our Global Human Resources Development Program are we offering “bottom-up” foreign language training to younger employees and equipping our mid-level employees with better ability to drive their work forward on a global stage. By thus raising language skills and adaptability to foreign cultures are we working on developing human resources with global perspectives who can take on international roles. We are also vigorously promoting personnel exchanges between overseas Group companies and Japanese business bases as part of our solid system for helping employees experience all kinds of foreign cultures and business environments.

Topics: Safety Systems Group Initiatives

Our Safety Group already derives over 70% of its sales from overseas, and its opportunities for overseas interactions will only increase going forward. Our quest to develop human resources capable of performing in the global market has seen us aim for mastery of strategic thinking for global business, foreign languages, communicative abilities, and responsiveness to different cultures. As such, since FY2023, we have been bringing human resources from overseas group companies into Japan.
In addition to gaining a greater understanding of head office values and business processes, these seconded individuals are able to construct yet better personal networks, and, upon returning to their country of origin, serve as bridges between the Japan side and overseas group companies. The Japanese employees who work with them can hone their senses of overseas cultures and business styles, and then utilize such learning in future dealings with overseas businesspeople.
Going forward, we will further promote human resource exchanges between Japan and overseas so that our employees’ roles can be expanded onto the global stage. We are also, both domestically and overseas, preparing a thorough and effective training program which can welcome a wider range of employees.

Promoting a Work-life Balance

With the aim of achieving compatibility between work, childcaring and nursing, and delivering a rewarding workplace in which each individual increases their productivity and displays their unique abilities to the fullest, we are working to introduce a variety of systems and policies which promote next-generation development and more advanced roles for women.
Furthermore, in order to enrich work-life balance, we are aiming to further increase take-up of paid leave by creating a 5-days-plus paid leave take-up plan (Yu You Plan) for each employee and sharing within workplaces, as well as instituting an Anniversary Leave System. We are thus making every effort to create a workplace environment in which annual leave can be easily taken.

The Various Systems in Place for Promoting a Work-Life Balance

System Title	Details
Flextime	Introduced at headquarters and in some of our research labs.
Childcare Leave	Can be taken until a child reaches two years old, subject to meeting the fixed requirements.
Childcare Support Leave	10 days of special leave can be obtained by either men or women for childcare purposes.
Child Nursing Care Leave	10 days of (paid) leave (5 days for health checks and vaccinations) can be obtained by employees for looking after their children of preschool age. This leave can also be taken in half-day units.
Anniversary Leave	3 days of annual paid leave can be obtained by employees for celebrating their own, or a household relative's, birthday, attending a child's school entrance ceremony or graduation ceremony, and observing their child's school lessons.
Nursing Care Leave	Up to 1 year of paid leave can be acquired for looking after a specified relative.
Reduced Working Hours System	Fixed working hours can be shortened by up to 2 hours of 30-minute units for the purpose of caring for children below middle-school age, and by up to 3 hours of 30-minute units for the purpose of looking after relatives.
Work-from-Home System	Introduced at headquarters, research labs, and for medical reps.
Staggered Working Hours	With starting times, finishing times, and fixed daily working hours set by business sites serving as the standard, employees can either move back or bring forward their start times by up to 2 hours in 30-minute units.
Annual Paid Leave	We have several days per year on which the taking of leave is encouraged. We also encourage the taking of 3 consecutive days during the summer season.
Paid Half-day Leave	Up to 30 half-day units per year can be acquired.
Planned Annual Paid Leave	1-3 days of leave can be acquired at headquarters and business sites during the May "Golden Week" Period under a particular labor agreement.
Time-Unit Annual Paid Leave	We are currently implementing a system by which up to 3 days per year (24 working hours) can be acquired in 1-hour units of annual paid leave.
Special Paid Leave	Up to 60 days of lapsed annual paid leave can be stored up for use in times of personal sickness or injury, family sickness or injury, child-caring, nursing of relatives, nursing of children, volunteering, donating bone marrow, and using up Active Life Leave for 10, 20 and 30 years of company service.

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