Sustainability Issues and Goals

OMRON Sustainability

Sustainability Issues and Goals

Sustainability issues identified through decision process, FY2020 goals, and OMRON's initiatives

Sustainability Issues and Goals

In fiscal 2017, OMRON set key sustainable issues based on it sustainability policy, which are made up of two main areas. The first are social issues OMRON should solve through the focus business domains defined in its VG2.0 medium-term management plan. The second are issues that should be addressed by building a strong platform to carry our VG2.0 to meet the expectations of stakeholders. OMRON set fiscal 2020 goals and is working since fiscal 2017 to achieve the goals. By aligning visions and directions of sustainability initiatives with VG2.0, OMRON is working toward sustained enhancement of corporate value.

Issues to solve through business
Response to social needs Factory Automation: Respond to labor shortages and diversifying manufacturing practices Healthcare: Zero brain and cardiovascular diseases, respiratory diseases Social Solutions: Contribute to secure, safe, and pleasant lifestyles for people around the world
Issues to respond to stakeholder expectations
Human Resource Management Talent Attraction and Development Diversity and Inclusion Wellness Management Occupational Health and Safety Respect for Human Rights and Labor Practices	Manufacturing Product Safety and Quality Reduction of Greenhouse Gas Emissions Appropriate Management and Reduction of Hazardous Substances Supply Chain Management	Risk Management Fair Business Practices Privacy and Data Security

Goals to Solve Social Issues through Business

OMRON will contribute to society by solving social issues in focus domains defined by VG2.0, while also achieving business growth.

Factory Automation

Details: Solving social issues through our businesses Factory Automation

Social Issues	・Shrinking labor force in developed countries, and lack of skilled workers in emerging economies ・Responding to increasingly advanced, diversifying manufacturing processes
FY2020 Goals	Sales Goals	Industrial Automation Business (IAB) JPY480 billion
FY2020 Goals	Sustainability Goals	Create new products leading to innovative-Automation in four focus industries　 —Create Controls Technologies for Manufacturing Innovation—
2018 Progress	Net Sales	Industrial Automation Business (IAB) JPY391.8 billion
2018 Progress	Progress Toward Sustainability Goals	Created innovative applications and new products through co-creation with customers, and innovated on production floors ・integrated: Together with evolutions in high-speed, high-precision motion control, innovated in the field of detection. ・intelligent： Started provision of the i-BELT service that utilizes production floor data, and that contributes to passing on the knowledge of skilled workers, and to workplace improvements. ・interactive: Released a cooperative robot that can take over simple work and that can bring about flexible production sites enabling collaboration between human and machines.
Case Studies	New products and services from developments using these three “i's” ・X-ray PCB inspection equipment (doubled speed of 3D high-precision PCB inspections) ・Mobile robots ・Collaborative robots

*innovative-Automation is the unique OMRON concept to bring innovations to production floors. This comprises three concepts: (1) Evolution in control (integrated); (2) Intelligence developed through ICT (intelligent); and (3) New harmonization between humans and machines (interactive).
*i-BELT uses IoT technology to collect data from manufacturing equipment. This data is then used to provide visibility for production floor conditions and identify issues to improve productivity. Based on this data, AI controllers provide optimized manufacturing line control for factories, eliminating line stoppages and product defects.

[Product line-up giving form to innovative-Automation, driving growth]

integrated (Evolution in Control)
interactive (New harmony between humans and machines)
interactive (New harmony between humans and machines)

Healthcare

Details: Solving social issues through our businesses Healthcare

Social Issues	・Increased incidence of brain and cardiovascular diseases attributable to high blood pressure ・Increased worldwide prevalence of asthma and other respiratory diseases
FY2020 Goals	Sales Goals	Healthcare business JPY150 billion
FY2020 Goals	Sustainability Goals	・Blood pressure monitors: 25 million units/year ・Development of analytical technologies to continuously track blood pressure fluctuations ・Nebulizers and asthma wheeze monitors: 7.65 million units/year
2018 Progress	Net Sales	Healthcare business JPY115.5 billion
2018 Progress	Progress Toward Sustainability Goals	・Expanded sales area for blood pressure monitors and nebulizers, as well as for asthma wheeze monitors ・Developed wearable blood pressure monitors to track blood pressure variations, and launched in the US in December 2018
Case Studies	[Support for brain and cardiovascular diseases] ・Information campaigns for doctors, who are key to the spread of measurement using home-use blood pressure monitors in India and other emerging economies (OMRON Academy has been held 5 times in India, with 250 doctors participating). Set up measurement booths at outlets stocking blood pressure monitors. ・Consensus Article Regarding the Significance of Night time Measurement of Hypertension announced in the journal of the European Society of Hypertension, looking towards the establishment of analysis tools to enable monitoring of variable blood pressure. [Nebulizer] ・In cooperation with Chinese pharmaceutical manufacturers, a decision to place nebulizers in hospitals. In Mexico, we are raising awareness amongst pediatricians of treatment of respiratory diseases.

[Initiatives in areas in which a sufficient global market scale is forecast, and in which we can demonstrate our strengths]

As well as aiming for zero events (preventing the onset of serious disorders (events) such as strokes and myocardial infarctions that are caused by high blood pressure) and zero asthma attacks, we are aiming to solve social issues by achieving personalized medicine.

Information campaigns in India

Social Solutions

Details: Solving social issues through our businesses
Social Solutions

Social Issues	・Contribute to secure, safe, and pleasant lifestyles for people around the world ・Global warming from CO₂ emissions ・Slow expansion of the renewable energy market
FY2020 Goals	・Creation of safe driving support systems and technologies ・Cumulative shipped capacity of solar power/storage battery systems:11.2GW ・Build an energy resource aggregation business using solar power/storage battery systems (Japan)
2018 Progress	・Introduced DriveKarte safe driving management service ・Completed advancement of safe driving indicators, and completed verification towards commercialization ・Cumulative shipped capacity of solar power/storage battery systems: 8.8GW ・The storage battery system business performed well
Case Studies	・Introduced DriveKarte safe driving management service to several hundred company-owned vehicles ・After demonstration testing, a low-voltage integrated receiving package for small condominiums and apartments is expected to be adopted by one major developer

Goals to Respond to Stakeholder Expectations

Human Resource Management

Under VG2.0, our human resources strategy calls for creating a strong company where employees grow, enjoy their work, and improve performance continually. OMRON envisions an organization in which individual members of a diverse workforce can put their unique talents to use and achieve personal growth on their own initiatives. By so doing, these workforce members drive the growth of OMRON by contributing to customers and society as a whole, through improvements of productivity and added value.

Talent Attraction and Development

Details: Talent Attraction and Development

OMRON’s Initiatives	＜Human Resources Strategy＞・Securing and training of next-generation leaders (candidates for important positions) ・Providing of a workplace environment that can attract and empower the diverse talent necessary for business growth ・Fostering of self-motivated employees who can achieve self-transformation and development
FY2020 Goals/KPIs	(1) Continued evolution of TOGA* towards meeting OMRON Principles (2) Ratio of non-Japanese in managerial positions overseas: 66% (3) Accelerate PDCA implementation through employee engagement surveys
2018 Progress	(1) Increase in employee participation in TOGA: +22% vs. prior year (2) Ratio of non-Japanese in managerial positions overseas: 62% (+15% vs. prior year) (3) Increased opportunities for communications between management and employees based on engagement results
Case Studies	(1) With the aim of bringing about greater empathy and mutual resonance, the fiscal 2019 TOGA conference involved approximately 100 company influencer employees. (2) Used periodic talent reviews in the selection of successors, and in localized positions. Systematic provision of opportunities for rotating roles and responsibilities as well as training aimed at the appointment of selected successors. (3) Based upon engagement survey results, identified issues common to organizational units and implemented countermeasures such as ensuring the full permeation of our full vision and structure, increasing personnel training, and improving business productivity.
Social Value	・OMRON is creating leaders who can drive innovation and both acquire and train diversely talented employees to solve social issues through our businesses.

*TOGA: an abbreviation for The OMRON Global Awards, a participation-type approach for employees worldwide to foster a challenge-oriented corporate culture that uses our business activities to put into practice the OMRON Principles. Through these activities, each and every employee seeks to voluntarily take on the challenges of solving social issues, and of creating value.

Diversity and Inclusion

Details: Diversity and Inclusion

OMRON’s Initiatives	<Diversity and Inclusion> (1) Promoting career advancement for women (OMRON Group in Japan) (2) Promoting career advancement for the disabled
FY2020 Goals/KPIs	(1) Ratio of women in managerial roles: 8%^*1 (OMRON Group in Japan) (2) Ratio of employees with disabilities: Increase number of such employees to above the legally-mandated ratio
2019 Progress^*2	(1) Ratio of women in managerial roles: 5.9% (OMRON Group in Japan) (2) Ratio of employees with disabilities: 2.8% (OMRON Group in Japan)
Case Studies	(1) Promoting career advancement for women ・Provided leadership training, career counseling, and networking opportunities for female employees ・Trained managers in employee development skills ・Female management mid-career hires ・Enhanced systems that enable flexible work styles (2) Employment of employees with disabilities ・Supported the activities of Group companies, and confirming that reasonable consideration taken ・Established a consultation system and support for activities using professional counselors ・Expanded duties aimed at increasing employment opportunities ・Implemented heart barrier-free — an awareness amongst everyone of accessibility issues
Social Value	・Achieving a workplace in which diverse human resources can play an active role, regardless of the presence of limitations such as gender or disabilities.

*1 Ratio of women in managerial roles — April 2021 Goal/KPI
*2 (1) is for April 2020, (2) is for June 2019

Wellness Management

Details: Wellness Management

OMRON’s Initiatives	＜Wellness management＞・Issuing of employee health management declaration ・Implementation of employee education ・Implementation of initiatives towards ameliorating factors that inhibit good health
FY2020 Goals/KPIs	・Improve awareness of wellness management (spread activities based on Boost5* globally)
2018 Progress	Established Boost5, and promoted it throughout the domestic group ・Set Boost5 activity goals for each overseas region, and started initiatives worldwide ・Jointly selected for the first time by the Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange as a “Management Health Brand 2019” (Feb. 2019)
Case Studies	[Within Japan] ・Published the OMRON White Paper, and made employees aware of the relationship between Boost5 and employee health and performance. ・As one measure to support smokers in quitting tobacco, the Graduation Marathon was held to offer them team support. [Overseas] ・Implemented individual activities in each area based upon Boost5 (In Europe, we are implementing exercise support programs, mental health care counseling, and food education programs tailored to each country. In other areas, we have developed other initiatives including health seminars and smoking cessation support programs to meet the needs of each region.)
Social Value	・Promoting employee health management and fitness increases productivity and employee creativity, as well as contributing towards job satisfaction and a sense of meaning for all employees. This is also effective in reducing medical costs.

*Boost5: Five areas of physical and mental health: Exercise, Sleep, Mental Health, Nutrition, Smoking

Occupational Health and Safety

Details: Occupational Health and Safety

OMRON’s Initiatives	＜Health and Safety related Management System and Improvement Activities＞・Promote the acquisition of international health and safety standards at major production centers ・Ensure personnel for promotion, and carry out education
FY2020 Goals/KPIs	(1) Number of major production centers acquiring international health and safety standards: Acquisition at centers comprising 80% of production (2) Stationing of promotion personnel: All covered sites (3) Rate of promotion personnel undergoing training
2018 Progress	(1) Introduced OSH at sites comprising 60% of production (OSH certification acquired: 5 sites, launched: 6 sites) (2) Placed managers at all covered sites (3) Standardized educational content globally by hierarchical roles, and local education implemented
Case Studies	・Carried out occupational health and safety compliance assessments using an external health and safety consultant, in cooperation with the environment department
Social Value	・While ensuring compliance with laws and regulations concerning workplace occupational health and safety, we are creating a work environment in which all employees at the OMRON Group can maximize their abilities, by striving to create workplaces at which employees can work safely and comfortably — both physically and mentally.

Respect for Human Rights and Labor Practices

Details: Respect for Human Rights and Labor Practices

OMRON’s Initiatives	＜Human Rights related Management System and Improvement Activities＞・Establishment of management system (human rights policy and organizational structure) ・Human rights risk analysis and corrective actions at production sites
FY2020 Goals/KPIs	(1) Define and adopt due diligence process (2) Human resources risk analysis and corrective actions at production centers
2018 Progress	(1) Carried out a survey into actual conditions of employees at on-site contractors in Japan (2) Investigated and analyzed risks to human rights at 21 global production centers (up +5 centers from the prior year)
Case Studies	・Investigated and analyzed risks primarily at production sites in China and Asia (Examples: forced labor, child labor, harassment, foreign labor, dispatched/contract labor) ・Implemented improvements and countermeasures based upon these survey results (Examples: review of work rules, improvements to welfare facilities, implementation of training, wider application of internal reporting systems, etc.)
Social Value	・Achieving a better work environment in which the human rights of all people working in the OMRON Group are respected.

Manufacturing

By putting the OMRON Principles into practice in a way that complies with its Manufacturing Policy*, OMRON will create social value and strives to contribute to sustainable manufacturing. In conformance with OMRON’s Purchasing Policy, OMRON also seeks to achieve sustainable procurement together with suppliers through purchasing practices that conform to our guidelines.

*OMRON’s manufacturing policy comprises three principles-Quality First, 3F (Front-loading, Flowing & Flexible), and H&E (Human-oriented & Eco-manufacturing). The "3F" policy refers to the creation of the value sought by customers in the upstream of the development process. This value is built into products and services so that we can deliver what customers require in the needed quantities and at the needed times. In this way, the policy addresses the creation and delivery of customer value. The H&E policy aims to achieve the best match between people and machines and promote humanity-focused, environmentally friendly manufacturing to use limited resources.

Product Safety and Quality

Details: Product Safety and Quality

OMRON’s Initiatives	＜Advancing Group-Wide Product Quality Management＞・Conducting group-wide product quality management reform ・Reducing product safety risk
FY2020 Goals/KPIs	・Ratio of newly developed products undergoing safety assessment: 100% ・Improve product safety assessments
2018 Progress	・These assessments: 100% ・Improved details of assessments, and started trials with new processes ・Completed revision of guidelines for OMRON Group rules*
Case Studies	・Expanded assessment details for the application of latest safety standards, laws, and regulations and to improve market and customer usability, and apply this to assessment processes in each business.
Social Value	・Incorporating quality, safety, environmental, and human rights into products and services, to bring about sustainable manufacturing.

*OMRON Group Rules: Internal rules established as a foundation for management in order to ensure transparency, fairness, and globality of management, and to ensure appropriate and prompt decision-making. These encompass 24 separate topics, including ethical conduct, risk management, unauthorized control, information security, safety assurance business management, IT controls, accounting and funding, labor and occupational health, environmental management, procurement, and brand logo management.

Supply Chain Management

Details: Supply Chain Management

OMRON’s Initiatives	＜Engagement with Partners＞・Holding of Global Partner Conference ・Promotion of sustainability self-assessment for important suppliers^¹ ・Introduction of management compliant with RBA^², and initiatives to maintain and improve this
FY2020 Goals/KPIs	・Sustainability self- assessment for important suppliers (Partner Suppliers): 100% implementation ratio ・Sustainability self- assessment: Achieved RBA score of 85 or more
2018 Progress	・Implementation of sustainability self- assessment has become a requirement for Partner Suppliers ・75 points or less: 0 companies (covering 47 companies, excluding 4 new important suppliers)
Case Studies	・At the Global Partner Conference, requested that Partner Suppliers conduct sustainability assessments and improvements ・Used individual meetings to dialogues with these suppliers, and to further communicate that sustainability is an issue for business ・Visited suppliers who have not implemented sustainability self-assessment, and requested their cooperation ・Conducted individual dialogues with suppliers with less than 75 points, and conducted follow-up to improve understanding
Social Value	・By solving social issues in the supply chain in cooperation with suppliers, achieving a society capable of sustainable production and consumption.

*1: Sustainability self-assessment: Supplier self-evaluation of their own initiatives into labor, safety, and health, using a questionnaire.85 points or above is considered low risk, whereas 65 points or less is considered high risk. Compliant with RBA (Responsible Business Alliance)
*2 RBA: abbreviation of Responsible Business Alliance. Global CSR alliance centered around the electronics industry.

Reduction of Greenhouse Gas Emissions

Details: Environmental Contribution
Details: Reducing Greenhouse Gas Emissions

OMRON’s Initiatives	＜Advancement of Green OMRON 2020＞・Reduction in greenhouse gas emissions by improving the efficiency of power usage, and by introducing renewable energy ・Provision of products and services that contribute to the spread of clean energy
FY2020 Goals/KPIs	・Reduce total GHG emissions by 4% (vs. fiscal 2016) ・Environmental contribution exceeds CO₂ emissions from production centers
2018 Progress	・Completed the action plan for a 4% reduction by fiscal 2020 ・Promoted wide-scale energy-savings and usage of clean energy ・Environmental contribution of 1,055 thousand tons of CO₂ saved vs. 193,000 tons of CO₂ emissions from production centers
Case Studies	・Introduced a system to visualize electricity usage in our factories (Ayabe, Kyoto) ・Moved to clean energy through in-house generation (China, Guangzhou Factory) ・Conduct assessment on potential of GHG reductions, and formulated a plan to introduce energy-savings and renewable energy at Japan and China locations, which comprise 70% of OMRON's energy usage ・Started procurement of zero CO₂ electricity in the Kanto and Kansai regions
Social Value	・Making sustainable manufacturing a reality by reducing greenhouse gas emissions, and bringing about a low-carbon society.

Appropriate Management and Reduction of Hazardous Substances

Details: Reducing Mercury by Promoting Replacement
Details: Stop Use of CFCs/HCFCs and Mercury (Fluorescent Lamp Use)

OMRON’s Initiatives	＜Advancement of Green OMRON 2020＞・Build a framework for chemical substance management s used in production processes ・Stop use or reduce the use of harmful chemical substances, responding to high social demand
FY2020 Goals/KPIs	(1) Reduce mercury through prevalent usage of digital thermometers and blood pressure monitors: 69 tons/year (2) Stop use of CFCs in FY2018. Also stop use of HCFCs and mercury (fluorescent lamps) in FY2020
2018 Progress	(1) 56 tons/year (thermometers: 1,093 million units, blood pressure monitors: 900,000 units) (2) Devices using CFCs: full abolition, devices using HCFCs: 64% reduction, fluorescent lights: 71% reduction
Case Studies	・By carrying out exhibitions in China and providing blood pressure monitors to research laboratories, we have promoted the introduction of blood pressure monitors in hospitals
Social Value	・Realization of a low-carbon society that is in harmony with nature, by reducing negative impacts of chemical substances on people, organisms, and the environment

Risk Management

OMRON promotes risk management that integrates all risk-related activities at the global level, in order to ensure business continuity and the achievement of goals, while also fulfilling its social responsibilities. By disseminating the polices and rules established in-house, OMRON seeks to build long-term relationships of trust with stakeholders while helping employees engage in work and business with pride and a sense of security.

Fair Business Practices

Details: Compliance and Risk Management

OMRON’s Initiatives	＜Enhanced compliance program＞・Periodic reviews of OMRON Group Rules for Ethical Conduct on a regular basis in order to reflect laws and regulations, and social demand of countries around the world ・Offer continuous, periodic and necessary training and education in order to maintain awareness of compliance and instill stipulated in rules ・Assess issues using the whistle-blower system and promptly take corrective actions
FY2020 Goals/KPIs	Continuous evolution of group governance ・Instilling OMRON Group Rules (OGR)^*¹ at locations worldwide ・Offer global training regarding the OMRON Group Rules for Ethical Conduct
2018 Progress	Completed construction of group governance system [Self-checking, monitoring, and auditing] ・OGR self-check and improvements (92 group companies) ・Started visualization of companywide monitoring and auditing, and load leveling at worksites [Education] ・Established content, and started education at each defined target level (executives, managers, all employees)
Case Studies	・Released a business risk case example book - the OMRON Risk Book, and shared this within the company ・To expand Corporate Ethics Month worldwide, the message from the CEO has been translated into 25 languages and sent to all employees worldwide ・Offer global training regarding the OMRON Group Rules for Ethical Conduct based upon the General Data Protection Regulation (GDPR)^*² in the EU (Europe) ・Holding of Wear Green Day event to improve employee awareness of ethics (Asia, Pacific)
Social Value	・Implementing appropriate anti-corruption measures taking into account the political, economic, and cultural circumstances of each country, and contributing to the maintenance of an orderly and healthy society based upon the rule of law. 　・Ensuring fair business practices in conformance with applicable laws of respective countries and global rules, thereby contributing to the realization of the society that allows fair and free competition.

*1 OMRON Group Rules (OGR): Internal rules established as a foundation for management in order to ensure transparency, fairness, and globality of management, and to ensure appropriate and prompt decision-making. These encompass 24 separate topics, including ethical conduct, risk management, unauthorized control, information security, safety assurance business management, IT controls, accounting and funding, labor and occupational health, environmental management, procurement, and brand logo management.

*2 GDPR: Abbreviation of General Data Protection Regulation. EU legislation on the protection of personal information. This regulates personal protection and the free exchange of personal data when handling these which applies to EU member states.

Privacy and Data Security

Details: Compliance and Risk Management

OMRON’s Initiatives	＜Rebuilding an Information Security Management System＞・Support for revised and newly enacted laws worldwide concerning the protection of personal information ・Strengthened technical measures to counter the sharply increasing cyber attacks ・Implement revisions in education on information security, and continue with education
FY2020 Goals/KPIs	・Build a new information security system
2018 Progress	・Completed support for laws and regulations such as GDPR^*¹ ・Started intensive monitoring of threat information regarding information security
Case Studies	・Contract regarding data migration concluded between Group companies ・Survey into personal information protection laws in each country, and updated OMRON Group Rules (OGR) ^*² ・Improved training of employees in personal information security (cyber attack training, etc.)
Social Value	・Enable appropriate management of confidential data and personal information to help conduct business safely and securely in a digitized society

*1 GDPR: Abbreviation of General Data Protection Regulation. EU legislation on the protection of personal information. This regulates personal protection and the free exchange of personal data when handling these, and applies to EU member states.

*2 OMRON Group Rules (OGR): Internal rules established as a foundation for management in order to ensure transparency, fairness, and globality of management, and to ensure appropriate and prompt decision-making. These encompass 24 separate topics, including ethical conduct, risk management, unauthorized control, information security, safety assurance business management, IT controls, accounting and funding, labor and occupational health, environmental management, procurement, and brand logo management.

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