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Hitachi Sustainability Report 2018 Fiscal 2017 Results Contents Hitachi Sustainability Report 2018 Fiscal 2017 Results Contents Introduction 02 Activities 38 How to Use This Report 02 Corporate Governance 39–51 Customers (Consumer Issues) 79–86 Editorial Policy 02 Pursuing Management Efficiency and Transparency 40 Pursuing Customer Satisfaction 80 Hitachi Group Profile 04–05 Sharing the Hitachi Group Identity 45 Ensuring Accessibility to Products and Services 82 Advancing Risk Management on Multiple Fronts 48 Ensuring Thorough Management of Quality and Safety 84 Management Approach 06 Human Rights 52–56 Community Involvement and Development 87–90 Respect for Human Rights Throughout the Value Chain 53 Promoting Sustainable Community Involvement Leadership 07–08 Respect for Workers’ Rights 56 and Development 88 CEO’s Message 07 Executive Officer’s Message: CSR and the Environment 08 Labor Practices 57–70 Environment 91–127 Achieving a Fair and Equitable Work Environment 58 Advancing Our Environmental Vision and Long-Term Recognition of Social Responsibility 09–33 Promoting Diversity and Inclusion 60 Environmental Targets 92 Realizing Sustainable, Innovative Management 10 Promoting Occupational Health and Safety 65 Managing Environmental Risks and Opportunities 96 The Key Social Challenges Hitachi Faces 13 A Strategy for Growing Together with Our Global Continuous Enhancement of Environmental Governance 100 Our Business Units and the SDGs 16 Human Capital 68 Promoting the Environmental Action Plan (Metrics and Targets) 111 Innovation Management 21 Understanding Issues Through Dialogue and Taking Fair Operating Practices 71–78 Part in Initiatives 28 Promoting Work Practices in Line with International Performance Data 128 Ethics Codes 72 Review and Improvement of CSR Activities 34–37 Engaging in Responsible Procurement 74 Indicators and Data 129–132 Enhancing CSR Management 35 Main Assessments and Awards 133–134 Independent Assurance 135 Hitachi Sustainability Report 2018 1 How to Use This Report Use the category tabs, navigation icons, and link buttons to go directly to different sections of this report. Click to go back one page Link Buttons Click to go to corresponding website Click to go to corresponding page Navigation Icons 1 Click to go forward one page Category Tabs Go to the beginning of the Contents Introduction Management Approach Activities Performance Data corresponding section Contents Introduction Management Approach Activities Performance Data Editorial Policy Basic Concept We are continuously improving our CSR activities and have What This Report Covers (Boundary of Reporting) identified nine key themes for our CSR management frame- Period: The main period covered is fiscal 2017 (April 1, 2017, to March 31, 2018) work: (1) recognition of social responsibility, (2) corporate gov- Companies: 1,287 companies, namely Hitachi, Ltd. and 1,286 consolidated subsidiaries (including 407 equity-method associates and ernance, (3) human rights, (4) labor practices, (5) environment, joint ventures) (6) fair operating practices, (7) customers (consumer issues), Boundary of Data: Financial data: 1,287 companies, namely Hitachi, Ltd. and 1,286 consolidated subsidiaries (including 407 equity-method associates and joint ventures) (8) community involvement and development, and (9) review Social data: Boundary of data indicated under each indicator and improvement of CSR activities. With reference to these nine key themes, the Hitachi Environmental 880 companies, namely Hitachi, Ltd. and 879 consolidated subsidiaries. However, for environmental data: performance data associated with Hitachi’s business operations, Hitachi, Ltd. and consolidated subsidiaries Sustainability Report 2018 details the social and environmental whose environmental load comprises 90% of the total (based on Hitachi calculations) are included. issues that are vital to the sustainability of our operations and Reporting Cycle: Published every year as an annual report society, presenting our stance and the activities undertaken in Date Published: October 2018 fiscal 2017. Notes: Inasmuch as the report is a tool with which we engage with • The data for each fiscal year are the results according to the boundary of data in that fiscal year. our stakeholders through honest and transparent disclosures • The base fiscal year data has been revised to match the boundary of data for fiscal 2017. of information, it contains our basic policies, promotion sys- tems, key performance indicators, and specific measures for our CSR initiatives in line with the disclosure requirements of the GRI Sustainability Reporting Standards (GRI Standards). Hitachi Sustainability Report 2018 2 [Symbol Marks Used in This Report] Independent Assurance was carried out in accordance with the International Standard * Technical terms, proper nouns, tables, diagrams, etc. requir- To enhance the credibility of this report, we have engaged on Assurance Engagement (ISAE) 3000 and 3410. ing explanation KPMG AZSA Sustainability Co., Ltd. to provide assurance on Performance indicators for fiscal 2017 that have been environmental and social performance indicators. This assurance assured are marked with in the report. [Hitachi References in This Report] Hitachi, Ltd.: Information on or initiatives of Hitachi, Ltd. Financial and Non-Financial Information Reports on Hitachi’s Value Creation Financial Information Reports Hitachi and the Hitachi Group: Information on or initiatives of all Group companies in and outside Japan Hitachi Integrated Report 2018 Year ended March 31, 2018 [Key Guidelines Referred to in Preparing This Report] • GRI Standards, Global Reporting Initiative • Environmental Reporting Guidelines (2012 version, 2018 version), Ministry of the Environment, Japan Web Investor Relations http://www.hitachi.com/IR-e/ Note: Information about Hitachi, Ltd. is also disclosed in the Annual Securities Report and the Disclosure of Financial and Non-Financial Hitachi Integrated Report 2018 (To be published late October in 2018) Report on the 149th Business Term. Information Hitachi, following closely the deliberations of the European Non-Financial Information Reports Union (EU) and the International Integrated Reporting Council The Hitachi Sustainability Report 2018 provides non-financial information to investors, auditors, and CSR experts in an easily searchable, interactive PDF format (A4, (IIRC) about non-financial disclosure, presents information to 137 pages). The CSR website contains not only the contents of this report but also news releases to provide up-to-date information to our diverse stakeholders. match the needs of stakeholders reading this report. Since the 2016 edition, the Hitachi Integrated Report has Hitachi Sustainability Report 2018 presented both financial and non-financial information Fiscal 2017 Results showing how Hitachi is striving to create value. The Hitachi Sustainability Report continues to serve as a comprehensive tool providing detailed non-financial information. Hitachi Sustainability Report 2018 Web Sustainability Web Environmental Activities Web Global Community Relations and http://www.hitachi.com/sustainability/ http://www.hitachi.com/environment/ Activities (Social Contribution Activities) http://www.hitachi.com/sustainability/sc/ Note: We also disclose information about Hitachi, Ltd. in the Corporate Governance Report. Hitachi Sustainability Report 2018 3 Hitachi Group Profile Company Profile (as of March 31, 2018) Consolidated Financial Highlights for Fiscal 2017, Revenue and Share by Segment (Consolidated for fiscal 2017, based on IFRS) Based on the International Financial Reporting Standards (IFRS) Information & Telecommunication Systems Corporate name Hitachi, Ltd. Revenue 9,368.6 billion yen 2,008.9 billion yen (20%) Incorporated February 1, 1920 (founded in 1910) (up 2%, year on year) Others Head office 1-6-6 Marunouchi, Chiyoda-ku, EBIT*1 644.2 billion yen (up 36%) 557.7 billion yen (6%) Tokyo 100-8280, Japan Income from continuing 638.6 billion yen (up 36%) Smart Life & Ecofriendly Systems Representative Toshiaki Higashihara operations, before income taxes 540.1 billion yen (5%) Representative Executive Officer, Net income attributable to 362.9 billion yen (up 57%) Automotive Systems Subtotal of Revenue by Segment President, and CEO Hitachi, Ltd. stockholders 1,001.0 billion yen (10%) 10,186.1 billion yen Capital 458.79 billion yen Capital expenditure*2 374.9 billion yen (down 1%) High Functional Materials & Components 1,657.5 billion yen (16%) Consolidated Revenue Number of employees 34,925 (unconsolidated basis) R&D expenditure 332.9 billion yen (up 3%) 9,368.6 billion yen Construction Machinery 307,275 (consolidated basis) Total assets 10,106.6 billion yen 959.1 billion yen (9%) Number of consolidated 879 (Japan: 202, outside of Japan: 677) Electronic Systems & Equipment *1 EBIT: Income from continuing operations before income tax, less interest income, plus subsidiaries (including 1,086.5 billion yen (11%) interest charges. variable interest entities) *2 Since fiscal 2015, the amount of investment in leased assets that fall under the heading of Social Infrastructure & Industrial Systems Number of 407 finance and leases included in conventional capital expenditure are deducted from capital 2,375.0 billion yen (23%) equity-method associates expenditure for disclosure. Note: Hitachi’s consolidated financial statement is prepared based on the International and joint ventures Financial Reporting Standards (IFRS). Revenue and Share by Region (Consolidated for fiscal 2017, based on IFRS) Other Areas 502.3 billion yen (5%)
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