Foundation Supporting Value Creation
Research and Technological Development
Our founder's spirit of "Always one step ahead of the rest" Technology born from watch manufacturing for precision processed parts and Craftsmanship leading to cutting-edge technologies electronic device products The Seiko Holdings Group utilizes its precision processing technologies cultivated in watch manufacturing to develop Caliber 68 Series dedicated movement for Credor and provide key parts and modules with stable quality to boasting one of the thinnest various industries, such as ABS parts for automobiles, designs in the world printing devices, hard disk components, medical components, and smartphones. This is also thanks to the Producing thin and compact watches with technological capability we have cultivated via integrated advanced assembly and machining in-house production since the founding of our company. For example, we have achieved robust industrial inkjet technologies print heads that continuously eject ink quickly and The precision technologies common to our products accurately at intervals of approximately 70 microns. were born from the integrated assembly, adjustment, This was made possible by our technological capability and casing conducted during our in-house watch to perform stable and high-precision manufacturing. manufacturing. Our compact and thin watches condense Furthermore, telecommunication systems that accurately all the elements required to mark the passage of time and seamlessly connect devices are required for the into a tiny package. We take pride in the fact that we coming IoT society. We have developed the smallest are a true manufacture d'horlogerie as we have the crystal oscillators in the world that remain practical with a high capability required to consistently produce these thickness of 0.5 mm, as well as manganese-silicon type major components in-house. For example, with the lithium rechargeable microbatteries (MS621R) that enable Caliber 68 Series products that are one of the thinnest reflow mounting. movements in the world, our expert craftsperson perform final finishing with their fingertips to perform shape Production management systems of in-house manufacturing lines give birth to "Craftsmanship, Miniaturization, Efficiency" is a technological adjustment at a precision of hundredths of a millimeter and hinge adjustment to ensure the appropriate gap philosophy that means: "Craftsmanship" creates new value based systems solutions between components. We have also developed various on our advanced techniques and know-how. "Miniaturization" mechanisms for improving the precision of timing, such We also develop time servers and master clocks that reduces product size through precision processing and high- as the Mechanical Hi-Beat and quartz mechanisms. support the stability and fairness of lifestyles via the stable density assembly technologies. "Efficiency" promotes the most supply of time information, which is a common lifestyle efficient use of all resources including energy. infrastructure, as well as time authentication, financial and logistics software, and environment monitoring/building management systems, etc. Our time servers maintain the Adopt high-difficulty accuracy of the time running in computers and network The technological philosophy of "Craftsmanship, watches. These efforts have increased our development inspection Develop revolutionary capability that leads to the creation of new products and techniques and new technologies and devices in the field of IT. This improves the reliability Miniaturization, Efficiency" leads to technologies to processing system for technologies unique to the Group. higher efficiency of transactions between companies such as financial enhance our Establish research and development and In addition to this advanced development capability, inspection capability processing institutions, and customers also adopt our systems production engineering technology the innovations in production engineering technologies production for the management of electronic data that requires capability that we have pursued over long years have led to the Inspection technologies to Processing accurate times, such as digital medical records at birth of cutting-edge technologies, such as our ability to achieve medical institutions. Since its establishment in 1881, the Seiko Holdings assemble movements at a high speed of less than one differentiation Group has been involved in clock and watch production second per movement. The Seiko Holdings Group will as a Japanese manufacturer. The principles that have continue to pass on its production engineering technology Mounting ECM formulated the foundation of the Seiko Holdings Group capability to the next generation and develop future Utilize external research Promote the development of Assembly institutes and super computers during this time are "Craftsmanship" for creating technologies for a new age. mounting technologies and to improve performance in process technologies to new value based on our advanced techniques and Develop and implement product design support new products know-how, "Miniaturization" for reducing product assembly/elemental technologies to int in nd ui d nd uti i e size through precision processing and high-density en nce sic beat the manufacturing e tern net or s technologies of other companies assembly technologies, and “Efficiency” for promoting tec no o ies the most efficient use of all resources including energy. Mastering technologies based on these principles of Craftsmanship "Craftsmanship, Miniaturization, Efficiency" has enabled us to assemble more than 200 components and develop Ultra compact SMD type crystal oscillator RC1536 series inkjet head technologies for the stable manufacturing of high-quality Miniaturization Efficiency A mere 1.2 x 1.0 mm and maximum Supporting the high productivity requires for thickness of 0.5 mm industrial printers with a unique ink circulation watches. We have simultaneously researched how One of the smallest in the world that system and high ejection pressure to miniaturize and improve the precision and power remains practical consumption efficiency of each component, such as Promote t e Pro ide the small gears used in mechanical watches and the de e opment o de e opment ne e ement support too s nd crystals, semiconductors, and batteries used in quartz tec no o ies ser ices
36 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 37 Foundation Supporting Value Creation
Research and Technological Development
Technology succession and global Creating new fields of business engineer training The Seiko Holdings Group also actively pursues product The Seiko Holdings Group has adopted a "professional development in new fields. TOPICs system" for passing on the skills and techniques For example, we also work on research and development cultivated in our manufacturing of products such of new technologies and new businesses that target Developing leading technologies as watches and precision components to the next new growth fields where we can utilize our strengths. In generation. This system certifies highly skilled employees regard to image processing technologies, we promote in a wide range of businesses in various positions as specialists or "meisters" and is development and fundamental research via the promotion systematically implemented to perform assessment and of ICT such as 3D-CAD, and develop equipment such as remuneration according to technical standards, train automatic inspection devices via image processing. We successors, and pass on skills in order to raise the level are also working to develop AI learning for sign prediction of specialization and ensure that skills and techniques are systems and high-precision time synchronization Development of new technology/ carried on. solutions, as well as enhance our IoT solutions. first exhibit at MEDTEC Since establishing an overseas manufacturing subsidiary We speed up this development via initiatives such as in the 1960s, the Seiko Holdings Group has gained long design-based thinking and open innovation. In March 2019, we collaborated with Ohara Inc. to exhibit for the first years of experience as a pioneer in global manufacturing time at Medtec Japan 2019, Asia's largest tradeshow for the design for a Japanese company. We also promote and train local and manufacture of medical devices. There we exhibited a "trace employees as executives and focus on improving the liquid feeding pump module" for use with devices such as insulin Trace liquid feeding pump module technical development capability of local employees to pumps for diabetes treatment, which we had been working on and cultivate a large number of excellent engineers. developing for commercialization. The "trace liquid feeding pump module" is a compact portable medical device for the continuous injection of liquid medicines in order to improve the QOL of patients, and achieves miniaturization and improved precision and power consumption efficiency by utilizing our strength of Craftsmanship, Miniaturization, and Efficiency. We will continue to promote our unique technologies in the growing market of the medical device industry.
Spring Drive Color tones appealing to the emotions/ In the pursuit of precision in mechanical watches, we provide watches with ingenious mechanism the first practical application of anodization technology in wristwatches called the Spring Drive to replace the regulator and escapement, in order to completely eliminate We have utilized our unique technologies such as mirror finishing cases, zaratsu polishing, and multiple errors due to friction between the pallet fork and the escape wheel. Although it is a mechanical face cutting to elevate a uniquely Japanese sense of beauty to a high-quality watch. We have also watch that uses the force of an successfully adopted anodization technology in unwinding spring to drive the gear Second hand watch components for the first time in the world train, it does not use a balance, Fourth wheel (sweep second pinion) to achieve high resistance to discoloration and a pallet fork, or an escape wheel. wear. This also enables us to achieve the color Instead, an IC applies a magnetic Second wheel Accelerating gear-train tone intended by the designer in the required brake on the rotation of the last Mainspring (barrel) locations without the need for coloring agents. This wheel of the gear train, based technology generates an artificial oxide film via a on a signal provided by a quartz Third wheel Glide wheel metal electrolysis process to generate color via oscillator, to precisely control the light interference, and since this process requires rotational speed at 8 Hz. Through particular control of the oxide film thickness, we Coil block were able to achieve it thanks to our high-precision The bezel text is finished in The rotor is finished with a multi-color this mechanism, the Spring Drive IC component processing technologies and surface gold via a laser anodization gradation via an anodization process. achieves the same level of precision Quartz Oscillator process. This means no Depicts the light of dawn rising from the as a quartz watch. processing technologies cultivated over our long peeling or discoloration. darkness of night. years of watch manufacturing.
38 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 39 Foundation Supporting Value Creation
Branding Strategy
Enhancing Digital Communication
In order to create contact points with people who are Moving ahead. Touching hearts. not familiar with Seiko, we utilize SNSs and have started a new Web magazine called "SEIKO HEART BEAT For Playfulness, excitement and a sense of thrill. MAGAZINE" on our website (available only in Japanese). The magazine includes articles regarding sports, music, and the businesses of our Group companies. Seiko has continued to provide the world with more than just products, services, and technologies. To demonstrate our strong commitment to "Moving ahead and Touching hearts," we seek to support and encourage those with real passion in the areas of sport, where athletes strive for new achievements in time and scores, and music, which provides people with quality time and uplifting experiences. In this, we wish to share fun and excitement with the world, and thereby aim to improve our brand value as a company that appeals to human emotions in a manner that transcends generation and language. MUSIC Music branding Seiko supports music and cultural activities based on the idea of "delivering quality time via music."
Radio program Music program SPORTS SEIKO SOUND STORAGE Seiko presents Sports branding This monthly J-WAVE radio program invites Sound Inn "S" famous guests active in various circles to Our Sound Inn "S" music program spotlights We continuously enhance our brand investment to strengthen the image of hear about their music and life. various artists, from the young and upcoming "sports timing = SEIKO." to established talent. Talk and sound deliver quality time and emotions that transcend the IAAF World Athletics Championships, boundaries of generation, genre, and language. the pinnacle of athletics.
Seiko supports the championships by measuring accurate time as the Official Timer of the event. Starting in 1985, we have now been in charge of timing and measurement at 16 consecutive championships as of the IAAF World Athletics Championships Doha 2019. Seiko strives to be a partner that understands the feelings of people that are serious about facing the challenges of
sport as we support timing at various competitions, both 2019 Japan Open 2019 World Judo Championships professional and amateur. IAAF World Athletics Championships Doha 2019 Co-sponsored events Each year, Seiko sponsors many sports events and provides timing and measurement with millisecond precision to convey the dynamics and emotions of each moment.
Major events co-sponsored by Seiko (FY2019) Team Seiko was formed in 2018 with Seiko Golden Grand Prix (Osaka) Gymnastics All-Japan Artistic Gymnastics Championships (Tokyo) Athletics athletes Ryota Yamagata and Chisato IAAF World Athletics Championships (Doha) Judo World Judo Championships (Tokyo) Mumbai Marathon (India) Fukushima, swimmer Masato Sakai, Marathons Figure Tokyo Marathon (Tokyo) NHK Trophy (Sapporo) and trampolinist Ginga Munetomo. skating Japan Swim (Tokyo) Swimming Fencing Japan Fencing Championships (Tokyo) They work hard together with Japan Open (Tokyo) Tennis Toray Pan Pacific Open Tennis (Osaka) friendly rivalry.
40 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 41 Foundation Supporting Value Creation
Human Resources Strategies
Aiming for sustainable growth of the Group by creating a Supporting the development of employees' abilities In addition to stratified training, we provide various understanding as well as giving virtuous cycle of "recruiting," "cultivating," and "leveraging" opportunities for improving the motivation and skill of our our younger employees English employees, such as executive candidate cultivation and conversation lessons by outside human resources career training. We also focus on cultivating global human teachers. resources, and hold seminars for deepening cross-cultural
Basic policy English conversation lesson
In the 7th Mid-Term Management Plan of the Seiko N ra ua Promoting the active role of all employees Holdings Group, the basic policy of our human resources strategy involves preparing an environment Improving the ratio of women Parental leave and parental shortened i ar r ecruit G o a a op ion where personnel with diverse senses of value can in managerial positions working hours work enthusiastically, aiming for sustainable growth of In regard to the empowerment of women, we have held The Seiko Holdings Group is making efforts to ensure a the Group by creating a virtuous cycle of "recruiting," Culti ate training and seminars, transmitted information via a Group good balance between work and childcare for employees "cultivating," and "leveraging" human resources. Promo h a i Pro u i i intranet, and adopted various systems from FY2013 and eligible for parental leave. We offer a program of reduced We have established an "Employee Empowerment ro o a mp o mana m n continue to do so. The 7th Mid-Term Management Plan working hours in line with the Child Care and Family Care Leave Act. We are striving to create a pleasant Committee" to promote further diversity across the entire om n S nior sets a goal of 15% women in managerial positions in Japan environment in which employees can work with peace of Group, promote the sharing of information and exchange e era e and strives for further promotion of women empowerment. of opinions, and prepare a workplace environment where mind and to their full potential. all employees can play an active role, including women, Emp o i h p op （ ） Usage of System for Parental Leave and Shortened im on rain ■Num r o om n in mana ria po i ion seniors, and employees with time constraints, while also H a h mana m n Impro p r onn Ra io o om n in mana ria po i ion Working Hours for Parental Care e elo or m promoting initiatives for improving productivity and health (Major subsidiaries in Japan) en ironment management. (FY) 2014 2015 2016 2017 2018 Parental leave (people) 75 87 74 100 101 Health management Shortened working hours for 100 112 115 112 109 parental care (people) The Seiko Holdings Group started initiatives for promoting the empowerment of women from fiscal year 2013, and has / expanded to activities for promoting the active role of all employees and work style reforms from fiscal year 2017. From fiscal year 2019, we have added the perspective of health management to our initiatives for promoting the active role of all Employing individuals with disabilities employees, and the Employee Empowerment Committee, HR management at each company, and health insurance union Vitalization of senior human resources The Seiko Holdings Group actively promotes the The revised Act on Stabilization of Employment of Elderly work together to achieve this goal. employment of individuals with disabilities. At our special Persons of Japan was enacted in April 2013 and, in subsidiary, Aoba Watch Service Co., Ltd., many persons principle, all persons wishing to work will be offered
os inobu Nakamura m n ement t mp o ee empo erment and other legal provisions of Japan relating to safety response to the shift to mandatory stress check tests e t insur nce union President e c comp n committee and health. We aim to ensure the safety and health of following revisions to the Industrial Safety and Health Act Plan, consider, decide, and execute policies SEIKO HOL INGS CORPORATION employees through such means as appointing persons in of Japan in December 2015, we are promoting employee e d o mp o ee mpo erment ommittee charge of overall safety and health, health supervisors and stress check tests, management training, specialized care [Committee head] Seiko Holdings Corporation President [In charge of practical work] Seiko Holdings Corporation officer in charge of HR industrial physicians, providing periodic health checks and from industrial physicians, and the establishment of an establishing the Health Committee. external consultation desk, etc.
42 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 43 Foundation Supporting Value Creation
Corporate Governance - List of Directors (current as of October 1, 2019)
SEIKO HOLDINGS CORPORATION SEIKO NPC CORPORATION Executive Director Senior Executive Director Public Relations, Sports Branding, and Director, Senior Vice President Chairman & Group CEO President Human Resources and IT Planning Corporate Culture Production & Human President Resources Executive Officer Director Director Director Shinji Hattori Yoshinobu Nakamura Akihiro Okuma Hiromi Kanagawa Hiroaki Okawa Kimio Yomogida Yoshinobu Nakamura Akihiro Okuma Shimesu Takizawa
Executive Director Director Senior Vice President Senior Vice President Director Finance & Corporate Strategy Planning Legal & Intellectual Property and Real Director General Administration Sales & Design Solution Watches Business and Accounting Estate Secretariat and General Affairs Director Director Corporate Auditor Executive Officer Executive Officer Shimesu Takizawa Kazuhiko Sakamoto Makoto Ichimura Shuji Takahashi Kunio Nakajima Hitoshi Murakami Haruhiko Takagi Hideaki Tadokoro Toshimitsu Ogasawara
Director Outside Director Outside Director Corporate Auditor Tetsu Kobayashi Tsuyoshi Nagano Yasuko Teraura Seiichi Mikami SEIKO Solutions Inc.
Director, Chief Executive Vice President Director, Senior Executive Vice Director, Executive Vice President Corporate Auditor Outside Corporate Auditor Outside Corporate Auditor Outside Corporate Auditor CTO and Senior Executive Manager, Director, Senior Executive Vice President Senior Executive Manager, President Business Promotion Unit President Strategic Business Unit I & II Corporate Affairs Unit Haruhiko Takagi Tomoyasu Asano Hideki Amano Masatoshi Yano Jun Sekine Tatsumi Hasegawa Akihiro Okuma Yoshio Kobayashi Takashi Nishimoto Director, Executive Vice President Senior Executive Manager, Business Finance & Accounting Unit Director Director Corporate Auditor Corporate Auditor Yoshiyuki Hashimoto Yoshinobu Nakamura Makoto Ichimura Shunji Tanaka Haruhiko Takagi Executive Vice President Executive Vice President Executive Vice President Executive Vice President Senior Executive Manager, Senior Executive Manager, Systems Senior Executive Manager, Senior Executive Manager, Network Solutions Business Unit and Mobile Solutions Business Solutions Business Unit and Executive SEIKO WATCH CORPORATION Data Service Business Unit Executive Manager, Network Solutions Technology Division Unit Manager, Region Business Division Hiroyuki Watanabe Hiroaki Onishi Toshimasa Ike Junichi Fujii Director, Chief Executive Vice President Director, Senior Executive Vice President Chairman & CEO President & COO & CMO Sales Division I Sales Division II Senior Vice President Senior Executive Manager, Senior Vice President Shinji Hattori Shuji Takahashi Minoru Ishiguro Akio Naito Digital Transformation Senior Executive Manager, Strategic Business Unit I, Business Unit Executive Manager, IoT Division and Mobile Solutions Sales Division Director, Executive Vice President Director, Executive Vice President Director, Senior Vice President Nobuchika Matsuoka Takeshi Ichikawa Director, Executive Vice President Marketing Planning & Development Product Planning & Development Sales Division II and Management Corporate Strategy & Planning Division Division Division Planning Dept.(Americas) Taku Yoneyama Kiyoko Niwasaki Hiroshi Nakahara Teruyo Ishimaru
Director, Senior Vice President SEIKO Clock Inc. Sales Division I and Management Planning Dept.(Asia II) Director Director Corporate Auditor Director, Senior Executive Director, Senior Vice Director, Senior Vice Director, Senior Vice Vice President President Director, Senior Vice President President Yoshikatsu Kawada Yoshinobu Nakamura Hiromi Kanagawa Atsushi Kaneko Business Strategy & Domestic Marketing President General Administration Research & Technology President Product Planning Division Division International Marketing Division Division Senior Vice President Kenji Hagiwara Ichiro Doi Akira Banno Koichi Fukumuro Satoshi Morita Osamu Sugita Sales Division I and Sales Planning Dept., Operations Dept. and Customer Senior Vice President Corporate Auditor Corporate Auditor Outside Corporate Auditor Service Dept. Research & Technology Director Director Director Director Corporate Auditor Division Seiichi Mikami Hideo Hattori Yutaka Nishimura Hiroshi Shimizu Yoshinobu Nakamura Kazuhiko Sakamoto Satoshi Yoshino Hitoshi Murakami Seiichi Mikami Hironori Yamada Senior Vice President Senior Vice President Product Planning & Development Marketing Planning & Development Senior Vice President Division and Movement Design & Senior Vice President Division, Marketing Dept. I, Marketing Sales Division I and Management Engineering Dept. and Product Corporate Strategy & Planning Division Dept. II and Marketing Dept.(CR) Planning Dept.(Asia I) Engineering Dept. and Corporate Strategy & Planning Dept. Yasunori Hagiwara Toru Tsuchiya Masato Takenaka Naoaki Tanimura WAKO Co., Ltd.
Representative Senior Managing Director, Managing Director, Honorary Chairman Chairman President Executive Director Senior Vice President Senior Vice President Seiko Instruments Inc. Shinji Hattori Tatsuhiko Adachi Shuntaro Ishii Masahiko Shoyama Hidetoshi Okamoto Kazuhiko Sakamoto Director, Executive Vice President Director, Senior Vice President Director, Chief Executive Vice President Director, Executive Vice President General Manager, Corporate President Director Director Director Director Corporate Auditor General Manager of Internal General Manager, Electronic Components General Manager, Watch Business Headquarters and Precision Technology Division and Quartz Chairman Controls Planning Office Device Business Headquarters Business Headquarters Crystal Division Takeshi Endo Shuji Takahashi Kiyoko Niwasaki Takashi Aizawa Makoto Ichimura Seiichi Mikami Yoshinobu Nakamura Tetsu Kobayashi Kazunari Watanabe Hiroshi Nakahara Shinji Nureki Senior Vice President Senior Vice President Senior Vice President Senior Vice President Director, Executive Vice President Director, Senior Vice President Director, Senior Vice President Director, Executive Vice General Manager, Corporate Deputy General Manager, General Manager, Motion Toshihiro Machida Mitsuo Shibuya Akiko Seno Takayuki Arai President Strategy Division Corporate Strategy Division Device Division Director Akihiro Okuma Shimesu Takizawa Hideo Hattori Takahiro Naito Kazuhiko Sakamoto Executive Vice President General Manager, Human Resources Corporate Auditor Outside Corporate Auditor Corporate Auditor Corporate Auditor & General Administration Division SEIKO Time Systems Inc.
Makoto Hirota Norimasa Kuroda Hiroaki Sahara Haruhiko Takagi Yumiko Ishida Executive Director Director Director President's assistant and Timing Division Sales Division Headquarters and Head Engineering Division Headquarters and Senior Vice President Seniore Vice President President Jurisdiction of Construction Management General Manager, Manufacturing Corporate Management Dept. Jurisdiction Administration Office Watch Division Senior Vice President General Manager, Senior Vice President Kenji Hagiwara Hiromi Kanagawa Shogo Sumida Ryozo Suenaga and Deputy General Manager, General Manager, Real Estate Printing Device Business General Manager, Precision Production Engineering Center Senior Vice President Dept. Headquarters Mechanical Device Division Director Director Manufacturing Division Headquarters and Yasuto Nakamura Tatsuo Sagami Takumi Yoshitomi Kenji Otsuka Masao Kasuga Sales Division Deputy Headquarters Factory Automation Division Headquarters Director Director Senior Vice President Kazuo Yamamura Mitsunaga Yata Shuntaro Ishii Satoshi Yoshino Senior Vice President Deputy General Manager, General Manager, Printek Corporate Technology Division Division Director Director Corporate Auditor Corporate Auditor Yoshihiro Takeda Kunio Nakajima Naoki Tajima Hitoshi Murakami Seiichi Mikami Hideo Hattori
44 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 45 Foundation Supporting Value Creation
Corporate Governance
Basic Principles of Corporate Governance (2) Appropriate Cooperation with Stakeholders (4) Responsibilities of the Board In addition, Outside Directors have abundant experience other than Shareholders As a company based on the principles to being a The Board of Directors is committed to a free, open and and high degree of knowledge on corporate management company that is trusted by society, Seiko Holdings As well as with shareholders, the Company also strive to constructive style of management. The Company aims and specific fields and help to improve the monitoring Corporation sees as core business challenges compliance cooperate with other stakeholders including customers, to ensure that it executes its duties timely and decisively functions over management from their independent with all laws and regulations, implementation of employees, business partners and members of the and that its actions create an environment where good standpoints. management transparency and fairness, and honoring communities where our facilities are located. The decisions can be taken by the senior management to social ethics—and to realize these goals by striving to Company believes that it bears a social responsibility to achieve sustainable growth and increased corporate value Evaluation of the Effectiveness apply and reinforce our corporate governance framework. contribute fully to the realization of a sustainable society over the mid- to long-term. of the Board of Directors We will work to drive sustainable growth and enhance the and to honor the Group's fundamental policy of "being a (5) Dialogue with Shareholders As part of efforts to strengthen the corporate governance company that is trusted by society." corporate value of the Company and the Group. The Company promotes constructive dialogue with system, the Company evaluates the effectiveness of the (3) Ensuring Appropriate Information Disclosure Board of Directors each year. and Transparency shareholders so as to support sustainable growth and Basic policy increase corporate value over the mid- to long-term Analysis and evaluation methods The Company shall appropriately make information (1) Securing the Rights and based on "Basic Policy on constructive dialogue with All Directors and Corporate Auditors were asked to fill out disclosure in compliance with the relevant laws and Equal Treatment of Shareholders shareholders." a questionnaire regarding the effectiveness of the Board regulations, but also strives to provide clear and useful The Company strives to develop a necessary environment of Directors, and replies were collected from all of them. information in a timely and detailed way beyond that for appropriately and effectively securing shareholder Corporate Governance Structure External consultants tabulated and analyzed the results by required by law in order to facilitate accurate evaluations ensuring the anonymity of the respondents. rights such as voting rights at the general meeting As the holding company, the Company clarifies the by the Company’s shareholders and other stakeholders The questionnaire was prepared based on initiatives and of shareholders and provide necessary information management responsibilities in each business and and to engage in constructive dialogue with them. discussions on the Company’s corporate governance to accurately to ensure that shareholders can appropriately develops an organizational structure for accelerating date, and the following evaluation items were set. exercise their rights. The Company is also committed to management decision-making, enhancing the function of
Accounting auditors analysis and evaluation of board effectiveness by referring the purpose of deliberating basic matters of business Accounting audit to these results. Appointment Termination execution and promoting management activities appropriately and promptly. Office for Corporate ethics Reporting Representative Audit Board of Auditors external reporting Committee Director, Chairman Furthermore, the Company establishes the Corporate Reporting Consultation services and Group CEO The Board of Auditors is composed of two Corporate Strategic Governance Committee as an advisory body for the Coordination Risk Management Conference Instructions Board of Directors. Auditors of the Company and three Outside Corporate for Management Discussion Representative Committee Director and Reporting Auditors. Its role is to make decisions on all matters President related to the audit. The Corporate Auditors audit the Information Board of Directors Disclosure compliance and validity of the Directors' business Committee Supervision The Board of Directors is composed of 11 Directors execution by participating in the Board of Directors Supervision (including two female directors), of whom two are Management Internal meetings and other important meetings. The Outside Council Audit Dept. Outside Directors. The Board of Directors, pursuant to Corporate Auditors offer necessary advice, suggestions the Regulations of the Board of Directors, is engaged in Audit and opinions, making use of their broad experience and decision-making concerning fundamental management insight in business management. matters and important business execution, in addition to Monitoring Units Operating companies matters set forth in laws and regulations and the Articles
Operating organizaitions of Incorporation, as well as the monitoring of business execution. Decisions regarding business execution other
(Note) Other than the above, the Company has advisory contracts with law firms for legal advice. than the above have been delegated to the management pursuant to the Regulations of Administrative Authority.
46 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 47 Foundation Supporting Value Creation
Corporate Governance
Corporate Governance Committee 2. Compensation system for officers Appointment and Dismissal a significance of holding them, taking comprehensively In order to enhance the objectivity and transparency of Compensation for Directors who execute business of Senior Management and Nomination into consideration the Company’s management strategy, management, the Company establishes the Corporate duties consists of “basic compensation,” which is a fixed of Candidates for Directors business relationships with clients, and the benefits and Governance Committee where outside officers account compensation, and “bonuses” (short-term incentive and Corporate Auditors risks, etc., associated with holding in view of its capital for the majority of members, as an advisory body for compensation) and “stock compensation” (mid- to long- The Company believes that it is essential that candidates cost. the Board of Directors. The Committee deliberates on term compensation), which are performance-linked for Directors and Corporate Auditors have the character Disclosure of the verification of the propriety of matters relating to compensation for officers, nomination compensation. Compensation for Directors who do not and knowledge suitable for their respective duties. cross-shareholdings of officer candidates, appointment and dismissal of execute business duties, including Outside Directors, and Based on this concept, in the nomination of candidates The Company’s Board of Directors verifies each year Representative Directors, Directors with special titles, and Corporate Auditors consists of “basic compensation only.” for internal Directors and the selection of senior the rationale for the holding of all listed shares held in Directors who execute business duties, and other matters The ratio of payment of the fixed compensation to the management, comprehensive consideration is given from cross-shareholding by the Group through examination of regarding corporate governance from an objective and fair performance-linked compensation is determined at an the standpoint of appointing the right person for the right the importance of the issuer as a business partner and perspective, and reports to the Board of Directors. appropriate level to serve as an incentive to contribute to position, so that talent is appointed in a well-balanced benefits and risks of shareholding in light of capital costs The members and the chairperson of the Corporate improving the corporate value of the Company, taking into manner to cover functions of the Company as a holding and other factors. Governance Committee are as follows: account the levels of the above peer companies. The ratio company as well as the Group’s business fields, while Most recently, an individual verification was conducted at of payment of each type of compensation is as follows: the meeting of the Board of Directors held in August 2019. Chairperson President Yoshinobu Nakamura ensuring accurate and timely decision-making. With regard to certain shares, which were determined Chairman & Group CEO Shinji Hattori Fixed Performance-linked In the nomination of candidates for internal Corporate compensation compensation to be lacking in significance or rationale for continued Outside Director Tsuyoshi Nagano Auditors, comprehensive consideration is given from Basic Stock-type the standpoint of whether the candidate possesses holding, the Company proceeds with discussions toward Outside Director Yasuko Teraura compensation Bonus compensation Members knowledge of the Group’s businesses as well as insight their disposal. Outside Corporate Auditor Tomoyasu Asano Representative Directors 1 0.2 0.2 Outside Corporate Auditor Hideki Amano regarding finance, accounting and legal affairs, and Based on the above policy on cross-shareholdings, the Directors who execute Outside Corporate Auditor Masatoshi Yano business duties other than 1 0.15 0.15 whether the candidate can contribute to ensuring the Company sold four stocks among the shares held by its Representative Directors soundness of management. subsidiaries in the fiscal year ended March 31, 2019. The above 1. and 2. were determined by the Board of In the nomination of candidates for Outside Directors, Standards for exercising voting rights on cross- Directors after being deliberated on by the Corporate comprehensive consideration is given from the standpoint shareholdings Governance Committee, a majority of the members of of whether the candidate possesses abundant experience With regard to the exercise of voting rights on cross- which are outside officers. and high degree of knowledge of corporate management shareholdings, the Company exercises its voting rights, 3. Calculation method for performance-linked and specific fields. upon fully respecting management policies and strategies, compensation In the nomination of candidates for Outside Corporate etc. of the issuing company, by comprehensively (Bonuses) Auditors, comprehensive consideration is given from the determining on whether the proposal contributes to the The standard payment amount of bonuses is the amount standpoint of whether the candidate possesses insight sustained growth and the mid- to long-term enhancement determined by multiplying the basic compensation by regarding finance, accounting and legal affairs, as well as of corporate value of the issuing company, and whether or the coefficient set by position. The individual payment abundant experience and high degree of knowledge of not it undermines shareholder value, among other factors. amount is determined by multiplying the standard specific fields. In addition, in making such decisions for particularly important proposals, the Company holds dialogue with (From left) Yasuko Teraura, Tsuyoshi Nagano, Tomoyasu Asano, Hideki Amano, Masatoshi payment amount by the payment rates according to the Based on the above policy, the Board of Directors Yano performance achievement ratio. Bonuses vary from 0% to determines the candidates proposed by the representative the issuing company, as necessary. The proposals directors, upon deliberation by the Corporate Governance deemed important by the Company are as follows. Compensation of Officers 200% according to the target achievement level. (Stock compensation) Committee, the majority of which comprises outside ・ Proposals on appointment of Directors and Corporate 1. Basic policy of the compensation of officers For stock compensation, points that the individual officers. In addition, with regard to the dismissal of senior Auditors For determining compensation for officers of the payment amount converted into the number of shares are management, in situations in which dismissal standards ・ Proposals of reorganization including mergers Company, the basic policy is as follows: granted in each fiscal year. The individual payment amount determined by the Board of Directors apply, such as ・ Proposals on takeover defense measures - To ensure transparency and objectivity of compensation is a total of the standard payment amount (fixed portion), when senior management is not fully fulfilling his or her ・ In addition to the above, proposals that may undermine as well as to set the compensation level appropriate for calculated by multiplying the basic compensation by the function in light of evaluations including the Company’s shareholder value their roles and responsibilities. coefficient set by position, and the amount (performance- performance, the Corporate Governance Committee - To encourage the execution of duties in line with the linked portion), obtained by multiplying the standard conducts deliberations in a timely manner, and the Board Internal Control System management philosophy and the management strategy, payment amount by the payment rate according to the of Directors, based on the results of such deliberations, The Company, in accordance with its basic policy on the and to motivate the achievement of management performance achievement ratio. The performance-linked dismisses the Directors from the office of representative internal control system, has established a Group-wide objectives, in order to achieve sustainable growth of the portion of stock compensation varies from 0% to 200% directors, Directors with special titles and Directors who internal control system, including the Group’s business Company and the Group and to enhance corporate value according to the target achievement level. The ratios of execute business duties. management, corporate ethics, compliance with laws in the mid to long term. the fixed portion and performance-linked portion are 50% and regulations, risk management and internal audits. The level of compensation for officers is determined based each. Cross-Shareholdings Furthermore, the Company monitors the operation status on results of the survey on compensation for officers Indicators for performance-linked compensation are From the perspective of improving the corporate value of internal controls and periodically reports the results to by third parties targeting similar companies in terms of consolidated net sales and consolidated operating profit, of the Group in the mid- to long-term, the Company has the Board of Directors. business contents and scale, etc. which are set as important management indicators for a policy to reduce shares that are deemed not to have the company’s performance evaluation to serve as an incentive for achieving the Group’s management targets. 48 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 49 Foundation Supporting Value Creation
Corporate Governance Corporate Ethics / Compliance
Initiatives to Revitalize the General Meeting of Shareholders and Facilitate the Exercise of Voting Rights Seiko Holdings Corporation fulfills its corporate social responsibility by complying with statutes, respecting social ethics, and setting up healthy and sensible corporate ethics. Based on this approach, Early dispatch of the convocation notice operated by ICJ, Inc. from the 155th Ordinary General ● Seiko Holdings Corporation has established the following as its Basic Principles of Corporate Ethics. of the general meeting of shareholders Meeting of Shareholders held in June 2016. The convocation notice of the Ordinary General ●Providing an (abridged) English version Meeting of Shareholders held on June 27, 2019 was of the convocation notice dispatched on June 7, 2019 (three business days prior The Company prepares an English version of the to the statutory date). In addition, prior to the dispatch convocation notice and posts it on the Company’s Basic Principles of Corporate Ethics of the convocation notice, it was digitally disclosed on website and the website of the Tokyo Stock Exchange. ● Complying with the laws and rules of the countries and regions where business is conducted the Company’s website and the website of the Tokyo ●Others and engaging in fair practices in the light of social ethics. Stock Exchange on May 29. The Company makes efforts to operate the general ● Aiming to become a sensible corporate citizen, and striving for harmony with society. ●Exercise of voting rights by electromagnetic means meeting of shareholders so that it is easy for ● Disclosing information in a timely fashion, and engaging in honest and transparent The Company has adopted the exercise of voting shareholders to understand, such as by providing communications. rights by electromagnetic means from the 155th visual presentations of the business report. In addition, ● Protecting the irreplaceable earth and contributing to the preservation of the environment. Ordinary General Meeting of Shareholders held in June the Company posts the convocation notice (Japanese ● Respecting fundamental human rights and individuality, and building up a corporate culture 2016. and English versions) and extraordinary reports on the with a broad vision which fosters the spirit of corporate ethics. ●Initiatives to improve the environment for institutional results of exercise of voting rights on its website. investors to exercise voting rights The Company has adopted the proxy voting platform Structure for the Promotion Implementing Corporate Ethics of Corporate Ethics and Compliance and Compliance Structure In accordance with the Basic Principles of Corporate The Company regards maintaining and implementing Status of IR Activities Ethics, the Company has established the Corporate Ethics Corporate ethics and compliance structure as a crucial Committee and Action Guidelines for Corporate Ethics, management issue and therefore implements business ●Preparation and announcement of the Disclosure Policy Plan, financial results information, timely disclosure and consistently promotes education and enlightenment, ethics training for all executives and employees. In March 2009, the Company established the IR Policy information other than financial results information, consultation and reporting, auditing, and evaluation, etc. The Company distributes the Law Handbook to and disclosed on its website. IR Presentation materials, and summary Q&As at the to all its officers and employees. executives, including those of operating companies, which ●Briefing sessions for individual investors IR Presentation in Japanese and English, in principle, Each operating company of the Group has established its contains information about their authority and obligations The Company holds (irregular) seminars for individual on its website. The Company also posts its annual own system of corporate ethics and action guidelines in for the purpose of avoiding legal risk and undertaking investors at branches, etc. of securities companies reports, notice of the ordinary general meeting of accordance with characteristics of its business, relevant proper management. The Company also provides them throughout Japan. In addition, the Company has shareholders, notice of resolution of the ordinary laws, regulations, and rules. Accordingly, when an with compliance-related training once a year on such established a page for individual investors on general meeting of shareholders and other information. incident involving corporate ethics occurs at an operating areas as risk of corruption. its website, which provides explanations of the ●Establishment of a department for IR company, the operating company is responsible for In addition, the Company provides training on corporate Company’s businesses and performance in an easy to The Corporate Strategy & Planning Department is resolving the issue. When requested by an operating ethics to employees twice a year that includes training on understand manner. responsible for IR. company, the Company provides full cooperation and harassment and e-learning so they can gain fundamental ●Briefing sessions for analysts and institutional investors support toward resolving issues involving corporate knowledge on information security. The Company holds quarterly results briefing sessions ethics. for analysists and institutional investors, as well as Internal Reporting System briefing sessions on businesses and factory visits. The Company has established a “Corporate Ethics ●Briefing sessions for overseas investors Managers and staff of administrative divisions of Helpline” as a contact point to receive consultations and Officers in charge visit overseas shareholders and overseas subsidiaries were gathered and a seminar reporting from employees regarding corporate ethics institutional investors once or twice a year. The on governance and fraud risks was held. and compliance. In addition to the internal contact point, Company also participates in conferences sponsored the Company has set up an external contact point at by securities companies. a law firm and provides an environment that facilitates ●Posting of IR materials on the website consultation and reporting for the user. Under this system, The Company posts its Mid-Term Management rules have been established to protect the user from any disadvantageous treatment on account of the consultation or reporting, and information that may identify the user and information relating to the consultation and reporting are strictly managed.
The 7th Mid-Term Management Plan presentation for analysts and institutional investors
50 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 51 Foundation Supporting Value Creation
Risk Management
In order to respond promptly and properly to the under normal use. However, due to changes in the social market tends to be low, over 80% of interest rates of Risk Management Committee, with the president of the various risks in business management, Seiko Holdings environment, such as stricter legal regulations on product the existing long-term loans payable has already been Company as chairperson. In addition, each operating Group promotes risk management based on the Risk accidents, or changes in the business environments, fixed. Although there is no significant risk of interest rate company independently promotes risk management, Management Rules that set the basic policy for risks there may be an increase in costs related to quality fluctuations, interest rate trends for future procurement while the Company’s Risk Management Committee facing the Group. issues and product liability, such as product recalls and may affect business results of the Group. supports the collection of risk information, the progress of compensation liability. (11) Market price fluctuations risk measures and the promotion of risk management at Business Risks (8) Intellectual property rights The Group holds investment securities for business each company. Furthermore, the Group Risk Management Risks that may seriously affect the operating results and/ The Group has taken measures, such as obtaining patent reasons. The Group also owns idle real estate, including Committee, made up of the representative directors of or financial position of the Group are outlined below. rights and protecting confidential information, in order to part of the former factory sites. In the case where the each operating company, has been established that (1) Economic trends protect important proprietary development technologies. market price of such investment securities and real estate allows the representative directors of each operating The Group handles certain products directly related However, there is a possibility that adequate protection fluctuate significantly, the Group’s business results and company to verify and share information on the risks to personal consumption, such as watches, clocks, may not be implemented depending on the region. financial position may be affected. facing the Group. electronic components for digital products and Furthermore, even though such measures are taken, there (12) Environmental issues The Company has also established the Crisis automobiles, high-end jewelry, apparel and fashion is a possibility that the superiority of the Group’s products The Watches Business, the Electronic Devices Business Management Manual in preparation for when crises occur, accessories, and household goods, etc. Consequently, may be impaired, if the Group cannot effectively eliminate and the Clocks Business engage in business activities and in normal times, has set out a system capable of consolidated business results are strongly affected by third parties’ products similar to its products. in accordance with various environmental laws and responding to crises, such as prompt collection of the trends in domestic and overseas economies, especially In addition, the Group has taken measures, such as regulations that regulate energy conservation, air and necessary information. trends in personal consumption. patent investigation to prevent infringement of intellectual water pollution, use of chemical substances, waste (2) High dependence on procurement property rights of other companies in developing new disposal, recycling, chemical substances contained in Group Risk Management Structure from specific supplier products. However, there is no reasonable way to products and soil and groundwater pollution, etc. These Board of Directors Due to the high dependence on procurement from eliminate every single possibility of infringements. In the businesses regard environmental conservation activities specific watch supplier, business results of the Watches case where the Group infringes intellectual property rights as one of the management tasks and promote various Strategic Conference for Management Business may be significantly affected by changes in of other companies, there is a possibility that business activities, including complying with laws and regulations results may be affected by a claim for an injunction or a as well as setting stricter voluntary goals. However, there terms of transactions with this supplier. Reporting Sharing claim for damages. are possibilities of bearing compensation for damages Risk Management Seiko Holdings Corporation Group Risk (3) Market environment Committee at each Risk Management Management operating company Committee (9) Currency exchange rate fluctuations and expenses for taking response measures, due to Monitoring Verifying Committee of the Electronic Devices Business Support Within the Group, the Watches Business and the an increase in expenses for responding to enforced Sharing Business results of the Electronic Devices Business are Reporting affected by demand trends of electronic devices, etc., Electronic Devices Business mainly engage in business regulations or occurrence of environmental problems in Group Risk in Japan and overseas. In this business field, the speed development for overseas markets. Some of those are the future. Management iaison Committee of development of new technologies and their mass engaged in business development for overseas markets (13) Information securities production is high, and the price competition is also from domestic manufacturing bases, and fluctuations The Group prevents information leaks through measures intense. Therefore, the possibility that delays in response in exchange rates may affect product prices, etc. In such as establishment of internal regulations and employee Initiatives to Address Significant Risks to changes in these market environments may have a addition, for the Systems Solutions Business and education concerning protection and management of The Group defines risks that could cause tremendous loss significant impact on business results is getting stronger. the Clocks Business that mainly engage in business personal information and confidential information obtained to the management of the Company and its consolidated (4) Country risks on manufacturing bases overseas development for domestic markets, foreign exchange in business operations. However, it cannot be guaranteed subsidiaries, regardless of whether the risk is inherent in The Watches business, the Electronic Devices Business fluctuations may affect procurement costs for parts that that there is no possibility of information leaks due to the Company or consolidated subsidiaries, as Significant and the Clocks Business have manufacturing bases are procured from overseas manufacturing bases in unforeseen circumstances. In the event of such situation, Risks. The Risk Management Committee of the Company in Singapore, Malaysia, Thailand and China. Changes foreign currencies. Furthermore, all items denominated there is a possibility this will affect business results of the or consolidated subsidiaries selects the Significant in social situations due to politics and economics, in local currencies, such as profits or losses and assets, Group due to a decline of the Group’s social credibility and Risks each fiscal year, determines the departments etc., in these areas may have a significant impact on for overseas subsidiaries are translated into Japanese a substantial cost burden to respond to such situation. responsible for the risks, formulates the annual risk manufacturing activities of these businesses. yen for preparation of consolidated financial statements. (14) Natural disasters response plans, and carries out prevention measures and (5) Dependence on sales to major customers Therefore, the Japanese yen-translated value of local In the case where domestic and overseas manufacturing countermeasures. In addition, Significant Risks that must For some of the Electronic Devices Business, the currencies may be affected by the exchange rate at the bases and facilities of the Group suffer damage due to be addressed in a cross-organizational manner are defined dependence on sales to major customers tends to be time of conversion. In particular, fluctuations of Japanese natural disasters such as earthquakes and typhoons, as Group Significant Risks, and the Company responds high, and a decrease in the volume of orders from these yen against U.S. dollars and euro, etc. may affect there is a possibility this will affect business results due directly to such risks. Responses to Significant Risks and customers may have an impact on business results of business results and the financial position of the Group, to manufacturing disruption, stagnation of sales, logistics Group Significant Risks are monitored by the Company’s this business. including foreign currency translation adjustment under and procurement functions, etc. Risk Management Committee, and information is shared (6) Increase in price of resources net assets of overseas subsidiaries. with the Group Risk Management Committee. The If resources such as crude oil and other raw materials (10) Interest rate fluctuations Group Risk Management Structure Group Risk Management Liaison Committee comprising surge due to changes in the supply and demand Currently, the relationship between the Group and financial In order to perform centralized management of risks secretariats of the Risk Management Committees of each environment, manufacturing costs may rise that causes institutions is favorable, and the Group can procure funds that could greatly influence the Group’s business, Seiko operating company supports the promotion of measures an impact on business results. necessary for business development including overseas Holdings Corporation is engaged in the development and against the Significant Risks of each company through (7) Quality issues and production liability without any problems. However, there is no guarantee that strengthening of the risk management structure for the inter-Group collaboration and cooperation. Products manufactured and sold by the Group do not it will be possible to continue to procure funds sufficiently entire Group as well as responses to risks that must be cause any accidents that have effects on human bodies in the future. In addition, as the interest rate level in the addressed in a cross-organizational manner, led by the
52 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 53 Foundation Supporting Value Creation
Social Contribution Activities
Supporting earthquake Social contribution in the spirit of Seiko to achieve a rich reconstruction via music society via sports, music, and education A Concert to Support Eastern Japan in a Spirit of Harmony
Since great earthquake attacked east-Japan area in in Fukushima Prefecture, and Tono in Iwate Prefecture. 2011, Seiko has been holding concerts to support Local school choirs and brass bands joined regional reconstruction in disaster areas. We have also been choirs and musicians to hold a special one-day event that holding the sound of "wa" Concert to Support Eastern unified a desire for reconstruction. Exciting experiences for the next generation Japan in a Spirit of Harmony in three prefectures of On March 11, 2019, it was held in the Bunkamura the Tohoku region and in Tokyo from 2013, in order to Orchard Hall in Shibuya, Tokyo. Tickets sold out in provide an opportunity for people in disaster areas and advance and more than 2,000 people attended the Seiko Exciting Clock School their supporters to deepen ties. In September 2019, concert. & Athletics School this was held in Matsushima in Miyagi Prefecture, Soma
At the Seiko Exciting Clock School, we visit elementary schools to communicate the entertainment of time and clocks to children so that they can experience the Supporting the social participation of fun of the manufacturing things and the importance of persons with intellectual disabilities teamwork. The Seiko Holdings Group employees have At the Seiko Exciting Athletics School, employee athletes worked as teachers Ryota Yamagata and Chisato Fukushima give children at these lessons lessons where they experience the fun of running. 80 Special Olympics since started in children participated in FY2018. Not only does this enable The international sports organization called the "Special 2017, and more children to experience the joy of moving their body and Olympics" has continuously conducted sports programs than 900 children playing sports, but it is also an opportunity to greatly that enable persons with intellectual disabilities to are scheduled to stimulate the athletes working as teachers. experience sports for the goal of independence and participate including social participation, as well as holding many competitions Seiko has co-sponsored the 2015 Special Olympics lessons in FY2019. that provide participants with an opportunity to put their World Summer Games in Los Angeles, the 2017 Special experiences into practice. Olympics World Winter Games in Austria, and the 2019 The first summer games were held in 1968, and now both Special Olympics World Summer Games in Abu Dhabi as summer and winter events are held every four years, in an official supporter. More than 7,000 athletes from 200 the same manner as the Olympics. countries and regions attended the games in Abu Dhabi, as well as more than 21,000 volunteers. Cultivating a rich spirit via music
Seiko Summer Jazz Camp Seiko supports children and young performers aspiring to become Contributing to the enrichment of education with Seiko products musicians. Seiko Summer Jazz Camp is a special co-sponsored event where Assisting primary education in Laos education as a top priority issue. instructors who are active on the world stage teach talented young As part of this project, Padeco Co., Ltd. and Tokyo Japanese people who want to be jazz musicians performance Seiko endorses the aim of the "Project for Improving Shoseki Co., Ltd. were contracted by JICA to assist the techniques, theory, and how to enjoy jazz. Teaching and Learning Mathematics for Primary production of national mathematics textbooks and the The 4th event was held in 2019 over a four day period and featured Education" conducted in Laos by the Japan International curriculum include the topic of how to read the time. talented musicians in New York as instructors. On the final day, an Cooperation Agency (JICA), and donated 300 Seiko However, since schools in Laos often lack clocks and open concert was held clocks in August 2019. many children have not seen one, we decided to donate to allow the students to The Laotian clocks in order to improve demonstrate their results, government aims to the effect of learning. The and various prizes were graduate from Least clocks we have donated awarded. Developed Country are assisting mathematics Several past students have status by 2020, and lessons at places such as also succeeded in turning defines disseminating elementary schools. professionals. and improving the quality of primary
54 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 55 Foundation Supporting Value Creation
Environmental Activities
Environmental Philosophy Seiko is cognizant that the protection of the global Biodiversity Conservation environment is the highest priority issue of humankind and Cultivating endangered plants Participating in "Green Wave" takes actions by giving considerations to preserving the In Chiba Prefecture where the Morioka Seiko Instruments head office and business locations Inc. has participated in environment as a good corporate citizen. of Seiko Instruments Inc. are "Green Wave" since fiscal located, Japanese white pine is year 2017, where they designated as an endangered maintain green areas, create species. Seiko Instruments Inc. insect hotels (see photo) and has registered as a supporter of conduct "green area tours" Products that are Kind or Contribute to the Environment Chiba Prefecture's preservation for introducing the organisms initiative, and is carrying out that live in the green areas of the company sites. The Seiko Holdings Group’s basic approach to product ratio of sales of green products was 97.6% in FY2018. planting of this endangered variant Green Wave is a global effort for understanding and promoting development is to develop "products that never break" Seiko Clock Inc. sells clocks that comply with the Act on of the Japanese white pine at biodiversity via interactions with forests and trees on the International and "products that can be used for a long time," and we Promotion of Procurement of Eco-Friendly Goods and business locations. Day for Biological Diversity. have delivered products that are kind to the environment, Services by the State and Other Entities of Japan (the products that improve the environmental performance "Green Purchasing Law"), focused on sales to offices. of customer products, and products and services that The Seiko Holdings Group recognizes that corporate Tree-planting efforts at factory sites Support for Marine Protection Activities "Save the Ocean" can actively contribute to improving the environment to environmental efforts are an important factor when Seiko Watch the market based on our technological philosophy of customers select goods and products, and will continue Corporation "Craftsmanship, Miniaturization, Efficiency." to strive to develop services and products that are kind donates part Since the mechanical watches that Seiko Watch and contribute to the environment. of its sales of Corporation focuses on require no battery or electricity Seiko Prospex and operate via the tension of a wound spring, they can diver's watches be used semipermanently provided they receive periodic to a marine environment maintenance. The Spring Drive mechanism that is only protection sold by Seiko Watch Corporation achieves a precision organization comparable to a quartz watch, despite also being Dalian Seiko Instruments Inc. has established a biodiversity area and established by powered by a spring. This may be the ultimate watch for promotes tree-planting. The company plants acacia, elm, and fig ocean explorer an age that requires both environmental kindness as well trees to create a stratified green structure. Maintenance of the green and ocean conservationist Fabien Cousteau, who is also the brand as precise time information. Seiko Watch Corporation area avoids the use of pesticides and herbicides in consideration ambassador of the Seiko Prospex. provides many other products with mechanisms that are of biodiversity and promotes the composting of material such as The company also runs an Instagram page for raising awareness on marine environment conservation, which shares the spirit of kind or contribute to the environment, such as solar and fallen leaves. adventure and experiences of ocean professionals to the world. Kinetic based on unique technology. SII Green Product Label Seiko Instruments Inc. provides products that are kind or * contribute to the environment, based on our technological Environmental Data philosophy of "Craftsmanship, Miniaturization, Efficiency." Clock complying Seiko Instruments Inc. operates the SII Green Product with the Green Purchasing Law Power consumption Water consumption Copy paper consumption m （ ｈ） ■O r a ■O r a Label system adopted in 2001 while continuing efforts for , apan apan ■ ■ promoting customer awareness of such products. The , , 96,278 95,511 92,842 89,441 92,777 Environmental Policy INPUT 1 , 1. We set environmental targets, systematically implement 1 , 156,141 154,572 157,768 104,172 measures and confirm the results leading to continuous improvements. , 2. We comply with relevant environmental laws, rules and 0 regulations in Japan and other countries, as well as industry- wide initiatives, and undertake efforts to prevent environmental pollution. 3. We ensure the effective use of resources and reduction of greenhouse gases and waste throughout the lifecycle, from CO2 emissions Industrial waste emissions Plastic container and packaging emissions manufacturing to sales, by such measures as green purchasing, CO ■O r a environmentally friendly production processes, management ■ apan of chemical substances, products, packaging materials and transportation methods, and thereby contribute to the conservation of biodiversity. 4. We share the Company's environmental policy, environmental OUTPUT issues and trends with our employees, and encourage their understanding and participation in environmental activities. 5. We strive for communication with society by conveying our policies and activities regarding environmental issues.
*Scope of calculation: Seiko Holdings Corporation and 20 operating companies in Japan and overseas Semiconductor operating companies excluded from scope of calculation from FY2018 due to being excluded from the scope of consolidation in January 2018 56 SEIKO HOLDINGS GROUP VALUE REPORT 2019 SEIKO HOLDINGS GROUP VALUE REPORT 2019 57