BANDAI NAMCO Group CSR Report 2008 CONTENTS The BANDAI NAMCO Group Corporate Philosophy ・・・・ 01 NAMCO BANDAI Holdings Corporate Data ・・・・ 02 The BANDAI NAMCO Group Business Portfolio ・・・・ 03 Message from the President ・・・・ 06 Feature Story on China ・・・・ 08 CSR Management 1 The BANDAI NAMCO Group's CSR Initiatives ・・・・ 18 2 Corporate Governance ・・・・ 19 3 Internal Control ・・・・ 20 4 Commitment to Compliance ・・・・ 21 5 Risk Management ・・・・ 23 Editing Policy In BANDAI NAMCO Group CSR Report Safety, Quality, and Universal Design 2008, the activities that the Group is 1 Quality Management conducting to fulfill its corporate social responsibility (CSR) are described in for Safety and Product Development ・・・・ 24 an easy-to-understand manner, giving 2 Initiatives for Universal Design ・・・・ 28 specific numerical values. This report is the second CSR report Environmental Conservation for the Group, and as one of its features, the report introduces the activities of 1 Environmental Management ・・・・ 30 the BANDAI NAMCO Group in China, 2 Enlightenment Activities for Employees ・・・・ 31 which is now attracting the attention of the international community for its 3 Anti-Global Warming Measures ・・・・ 34 quality and safety achievements. Also, to Development and Marketing of 4 make the report easier to read, we have Environment-Friendly Products ・・・・ 36 adopted a universal design font for the 5 Reducing Waste and Recycling Resources ・・・・ 40 text of the report. We hope that this report will give our readers a deeper 6 Establishing a Recycling System ・・・・ 43 understanding of the BANDAI NAMCO 7 Reducing the Environmental Impact of Logistics ・・・・ 44 Group. 8 Environmental Communication ・・・・ 46 Period Covered Cultural & Social Contributions This report presents actual data for fiscal 1 Social Contribution ・・・・ 52 2007 (From April 1, 2007 to March 31, 2 Contribution to Culture and Society・・・・ 53 2008) and also covers some activities 3 Regional Contributions ・・・・ 57 that were begun in fiscal 2008. 4 For the Welfare of Children ・・・・ 59 Organizations Covered Enhancing Corporate Value This report covers the consolidated 1 Building Excitement and domestic companies of the Group listed a Sense of Fulfillment in the Workplace ・・・・ 62 on p. 04 and 05, but excluding equity 2 Career Advancement Support ・・・・ 64 method affiliates. Third-Party Opinions ・・・・ 66 Guidelines Referred to References between this Report and GRI Guideline Indicators ・・・・ 68 Environmental Reporting Guidelines (Fiscal 2007 Version) Postscript ・・・・ 69 The 2006 Sustainability Reporting Guidelines The BANDAI NAMCO Group Corporate Philosophy This Group Corporate Philosophy acts as the foundation for the Group's decision-making processes and a source of inspiration for every Group employee. In short, it represents the fundamental policy underpinning all the Group's activities. The Group Corporate Philosophy encompasses all the separate corporate philosophies formulated by individual companies in the BANDAI NAMCO Group. Anchored by this corporate philosophy, the BANDAI NAMCO Group respects the independence and autonomy of every affiliated company, aiming to boost the corporate value of the entire Group by maximizing the creativity of these companies and generating new synergies. The BANDAI NAMCO Mission Statement Dreams, Fun and BANDAI NAMCO will continue to provide Dreams, Fun and Inspiration Inspiration to people around the world through entertainment based on creativity and boundless enthusiasm. BANDAI NAMCO believes that: Dreams, Fun and The meaning of Dreams, Fun and Inspiration will essentially change Inspiration are over time, but BANDAI NAMCO holds one unshakable belief: that Dreams, Fun and Inspiration will always hold the key to happiness. the Key to Happiness BANDAI NAMCO's basic ethos is defined by: More Passion, ・Unparalleled curiosity and boundless enthusiasm More Innovation, ・Abundant creativity unrestrained by the status quo More Perceptive ・Open to people's needs and satisfaction from giving inspiration Our Vision To become the World's The BANDAI NAMCO Group will constantly strive to be a pioneer, Most Inspiring aiming to deepen and widen the appeal of entertainment and winning the hearts of people worldwide who enjoy having fun. Entertainment Group Our ultimate goal is to become the World's Most Inspiring Entertainment Group. The BANDAI NAMCO Group symbol will be used widely by NAMCO BANDAI Holdings Inc. and its affiliated companies, acting as the visual icon for the entire Group. Brand Concept Fusion and Evolution Like a newly energized life form, Bandai and NAMCO will organically integrate and fuse, constantly evolving to generate unparalleled Dreams, Fun and Inspiration-a concept represented in the BANDAI NAMCO Group symbol. Group Symbol Color Red, orange and yellow Our passion and unbridled approach to entertainment is expressed by the layered red, orange and yellow colors in the Group symbol. CSR Report 2008 01 NAMCO BANDAI Holdings Corporate Data Corporate Data Corporate Name NAMCO BANDAI Holdings Inc. Head Office 9th Floor, Taiyo Seimei Shinagawa Building, 2-16-2, Konan, Minato-ku, Tokyo 108-0075, Japan Capital ￥10 Billion Main Business Planning and execution of medium- and long-term management strategies for the BANDAI NAMCO Group; provision of support for business strategy implementation by Group companies and management of business activities. Number of Employees 6,948 people Number of Consolidated Subsidiaries 62 companies (Including equity method subsidiaries) *As of March 31, 2008 cial Data Consolidated Finan ● Net Sales (Unit: Billions of yen) ● Operating Income (Unit: Billions of yen) BANDAI NAMCO NAMCO BANDAI Holdings BANDAI NAMCO NAMCO BANDAI Holdings 500 50 460.4 450.8 459.1 42.2 400 40 35.6 33.4 300 30 269.9 27.6 263.1 25.8 244.9 24.3 200 20 172.5 178.5 154.7 15.4 15.0 100 10 9.4 0 0 FY03.3 FY04.3 FY05.3 FY06.3 FY07.3 FY08.3 FY03.3 FY04.3 FY05.3 FY06.3 FY07.3 FY08.3 *Figures for FY03.3 to FY05.3 are the consolidated figures for BANDAI and NAMCO prior to the management integration. 02 CSR Report 2008 The BANDAI NAMCO Group Business Portfolio The BANDAI NAMCO Group comprises five Strategic Business Units (SBUs) and the affiliated business companies, which support the work of the SBUs. The SBUs, which encompass the operating companies in each field, formulate and implement operat- ing strategies and provide a diverse range of entertainment in Japan and overseas. The BANDAI NAMCO Group is developing businesses in a wide range of entertainment fields. We have established a holding company, which we believe is the ideal organizational structure for making use of the originality of the brands in each of our fields while fully leveraging Group synergies. In formulating and implementing operating strategies for Japan and overseas, a central role is played by our five Strategic Business Units (SBUs)-Toys and Hobby, Amusement Facility, Game Contents, Network, and Visual and Music Content-which encompass the operating companies in each field. In addition, we have clarified the lines of responsibil- ity and authority. At the same time, the Affiliated Business Companies provides support for the operations of each SBU. Strategic Business Units (SBUs) Toys and Amusement Hobby Facility Strategic Strategic Business Unit Business Unit Affiliated Game Contents Business Strategic Companies Business Unit NAMCO BANDAI Holdings Visual and Network Music Content Strategic Strategic Business Unit Business Unit The key objectives of the management integration into the BANDAI NAMCO Group were to focus the strengths of Bandai and NAMCO, to further enhance the breadth and depth of our business activities in the entertainment industry, which is marked by intense change and competition, and to maximize the enterprise value of the Group. The management integration has allowed us, as an entertainment group, to operate in a wide range of fields-such as toys, amusement facilities, arcade game machines, game software for home video game consoles, network services, and visual software-in the global market. We will aim to secure stable growth and to leverage Group synergies that make full use of these operational fields. CSR Report 2008 03 Toys and Hobby SBU Constantly strive to create unique value for customers We are working to further advance character Engine Gattai Series Yeah! Family Iroiro! DX Engine Oh Tamagotchi Plus merchandising, one of the Group's strengths, Bandai Co., Ltd. Bandai Co., Ltd. and constantly striving to create unique value These products have The Tamagotchi Plus series, for customers. In the domestic market, we are remained popular among which was brought back children for more than in 2004. broadening our target customer groups and are 30 years. moving beyond our previous focus on toys by advancing into new fields. In overseas markets, Official Othello My First Seika Megahouse Corporation Hasami Asobi/ we are aggressively expanding our operations. Hajimeteno Hasami 35 years after its launch, Seika Co., Ltd. Moreover, to implement a range of strategies the game still remains more rapidly, we are aggressively building popular around the world. Seika offers a range of stationery from strategic relationships with external partners. entertainment stationery to school goods. Main Group Companies Bandai Co., Ltd. Megahouse Corporation Seika Co., Ltd. CCP Co., Ltd. Seeds Co., Ltd. Plex Co., Ltd. People Co., Ltd.* Bandai America Incorporated BANDAI S.A. BANDAI U.K. LTD. BANDAI ESPANÃ S.A. BANDAI（H.K.）CO., LTD. BANDAI ASIA CO., LTD. BANDAI INDUSTRIAL CO., LTD. BANDAI KOREA CO., LTD. CREATIVE B WORKS CO., LTD. BANDAI（SHENZHEN）CO., LTD. Amusement Facility SBU Leverage Group synergies and provide comfortable and fun facilities that can be enjoyed by large numbers of people Drawing on distinctive BANDAI NAMCO Group NAMCO NAMJATOWN NAMCO WONDER PARK NAMCO LIMITED HERO'S BASE strengths, such as Group synergies, we are One of the largest indoor NAMCO LIMITED providing highly original facilities and high value theme parks in Japan, The appealing added services that can be enjoyed by custom- featuring a wide range of entertainment facilities attractions. integrate amusement and ers of all ages. At the same time, we will characters.