In 2021, the Daifuku Group reviewed the material issues (materiality*1) that form the core of our CSR activities since 2014 with the aim of both achieving the sustained growth of our business and the sustainable society envisioned by the SDGs. We have set KPIs*2 for each of the issues in the 18 newly-identified materiality aspects, and we have launched a company-wide Sustainability Action Plan with specific goals for the next three years. Materiality will be revised in line with the timing of the Group’s three-year business plan and changes in the business environment and social trends.
- *1Issues that need to be addressed as top priorities, as they have a significant influence on the environment, society, and governance or the evaluation and decision making of stakeholders
- *2Key Performance Indicator, a quantitative performance evaluation index that measures target achievement
|Initiatives||Materiality||Reason for importance|
|Contribute to a smart society||Promote innovative technological development and invention||In terms of deploying our corporate activities through manufacturing, intellectual property is the most crucial asset to both strengthening our competitive edge and supporting our business going into the future. We will promote constant invention, such as with investment into innovation, to create new value and solve salient problems.|
|Develop new business domains||Making efforts to expand existing fields and carve out new ones is essential to operating as a sustainable materials handling manufacturer. To these ends, we actively engage in open innovation with universities and other companies, and we promote synergistic M&As.|
|Cater to customer needs through smart logistics||The introduction of cutting-edge technology like AI, IoT, 5G, and robotics to material handling systems has allowed us to dramatically increase the value we provide to our customers. Benefits include the optimization of costs and time spent on distribution, a reduction in our environmental footprint, and improvements to information security. Moreover, by effectively integrating these technologies into not only our products and systems but the entirety of our value chain, from procurement to service and disposal, we are contributing to the early adoption of smart logistics.|
|Maintain and improve the quality of products and services||Optimize production through globalization||Considering that overseas sales account for 60% of our overall sales, pursuing the optimal production site for each stage of our processes, from procurement to construction and service, is indispensable to solving issues and maintaining quality, as well as reducing our environmental footprint and manufacturing costs. We bring in localized labor, goods, and systems to establish a genuine global production structure.|
|Pursue product quality and safety||We believe that, as a leading materials handling company, it is crucial for us to continue to make efforts at all of our sites to sustain and improve product and service quality so that we may gain the trust of our customers and provide the most suitable and optimized solutions to every region in the world. We also consider it a critical mission of ours as a mechanical device manufacturer to take every possible precaution in our processes to provide the safe use of our products by our customers.|
|Enhance operational framework||Strengthen governance||For Daifuku to achieve the sustainable business we envision, we cannot do without corporate governance and internal controls. The former builds a fair management system, while the latter governs business through company internal rules. These two systems are crucial in running our business so that we may gain the confidence of the stakeholders involved with the company and improve our corporate value.|
|Ensure compliance||Laws and regulations are being established and revised on a daily basis according to social and regional context. Even if there is no conflict with laws and regulations, a deviation from corporate ethics and an inability to meet the expectations of society could result in harm to our credibility, as well as decreased corporate value. Activities to counter any tendencies towards corruption that threaten the continuity of business operations must be implemented for all employees without fail.|
|Manage risk||We must assume and take all conceivable measures against the various risks that may threaten business continuity, such as natural disasters, lapses in compliance, hindrances to the acquisition of personnel, problems with safety and product quality, etc. It is important to build a resilient corporate structure that is capable of minimizing the impact of such emergencies.|
|Ensure responsible procurement in the supply chain||In developing our business, it is essential to work together with our business partners who provide goods and services to respond to social demands in areas such as labor, human rights, the environment etc., including beyond that of just legal compliance. This kind of long-term relationship with stakeholders leads to true trust building.|
|Strengthen information security||Threats to information security are becoming increasingly sophisticated and malicious, meaning it is important for us to establish and properly utilize a system that enables sufficient protection and management of information about our company and various stakeholders.|
|Ensure transparent information disclosure and strategic communication||As the business environment expands to a global scale, the relationship of trust we have with the stakeholders involved with Daifuku, including our customers, shareholders and investors, employees, business partners, and municipal and regional societies, is the bedrock of our operations. Therefore, we must engage with them in constant good faith and from a multifaceted perspective, and we must disclose information in a transparent manner.|
|Respect human dignity||Protect employee safety and health||Based on the concept that safety is the ultimate priority, Daifuku strongly believes that sound business operations are only possible by establishing a corporate culture that gives top priority to workers' safety and health at all workplaces. As a result of this belief, we provide a safe and healthy work environment to all of our employees.|
|Achieve diversity and inclusion||To expand our business around the world and continuously grow while producing new value, it is essential that we value diversity, not only by gender and race, but by creed, religion, nationality, educational background, disability, and values.|
|Create a workplace environment that motivates employees||To foster the open and transparent corporate culture that is part of our management philosophy and to contribute to the advancement of customers and society, each employee must be able to experience job satisfaction and feel that their work is rewarding. Moreover, such a corporate culture enhances our corporate value, improves our competitive edge, and aids us in acquiring high-quality talent.|
|Cultivate human resources||The capabilities required of each employee differ considerably by job category, position, country or region, etc. In order to enable departments and individuals to fully develop their performance potential, the company must support and enhance these capabilities through a suitable training framework based on a clear understanding of what is required.|
|Respect human rights||Many people across the globe currently suffer from human rights violations. Respect for human rights is a major responsibility that we must take on as a corporate organization active around the world.|
|Contribute to the environment through our business||Keep business operations environmentally friendly||Daifuku's various business activities have a considerable impact on issues of global concern, such as climate change and biodiversity conservation. There are also legal risks directly linked to business opportunities related to energy, resources, hazardous chemical substances, etc., which require appropriate countermeasures.|
|Expand environmentally friendly products and services||Products and services that Daifuku offers to society through our customers are affecting the global environment through the use of electricity and resources. As we move into the future, responding to the demand for environmentally sound products and services across national and organizational barriers is a very important task for business continuity.|
Materiality Identification Process
The Daifuku Group identified materiality using the sequence below. Further, we identified and organized issues by taking into account international guidelines and dialog with stakeholders and confirmed compatibility with corporate policies, such as our company creed and management philosophy.
STEP 1Identifying and classifying issues
- ①ESG evaluative analysis:
We have compiled evaluation results by multiple global ESG evaluation bodies and assessed both the expectations of our primary stakeholders as well as our issues and strengths.
- ②Impact analysis:
We have examined the risks and opportunities in our value chain and classified the impacts to our management in line with the SDGs vision of the world in 2030.
STEP 2Identifying materiality
- ①Extracting candidates:
Materiality candidates were extracted from the results of Step 1 by a 10-person internal project team representing each business unit and Corporate Functions.
- ②Impact evaluation by issue:
Regarding these materiality candidates, five outside experts (investors, university professors, NGO experts), three of our customers, and four of our outside directors evaluated the degree of impact they would have on stakeholders and Daifuku business.
- ③Identifying materiality:
Based on the impact evaluation results by multiple individuals, low-priority issues were excluded, new issues added, and a draft materiality list created.
STEP 3Confirming adequacy
The identified materiality list was deliberated (verification and review of the adequacy of the selected issues) and approved by the Sustainability Committee, which is chaired by the CEO, and the Board of Directors.
STEP 4Target setting and review
We set up KPI for the 18 materiality aspects and conducted initiatives, disclosures, and reviews after setting goals for the of progress of each materiality.
We conducted an evaluation of the materiality candidates extracted by the internal project team according to the following methods and identified 18 materiality aspects.
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