Material Issues

Through a resolution passed by the Board of Directors in 2020, the SHI Group has identified seven material issues from both the perspectives of their importance to society and stakeholders as well as their importance to the SHI Group itself.
In January 2024, we reviewed our material issues.
Through our efforts to address these material issues, we seek to meet the expectations of our stakeholders while pursuing our vision of achieving sustainable growth for the Group.

Material issues for value creation

Create better ways to live and work: We are working to help alleviate the operational burden on our customers and end-users, implement work-style reforms, and improve safety through the automation and digitalization of our products. We hope to contribute to work-style reforms and better lifestyles for people working in various industries through the further strengthening of these efforts.

Reduce environmental burden: Our Group recognizes the importance of both reducing the environmental burden of our production activities and reducing the environmental burden of our customers when they use our products, so we engage in related efforts.
We are also working on creating a circular economy by taking steps that include reducing waste through the effective utilization of resources and reducing the environmental burden associated with the procurement of raw materials.

Material issues for strengthening our business foundation

Prioritize employee safety, health, and development: We believe that the management of human capital is a particularly significant theme for our Group in order to accelerate globalization and provide products and services that meet the needs of society.
Based on our ethos of “People are our most important asset.” which runs throughout the SHI Group, we not only put safety first in all our business operations but also actively engage in activities that include health management, human resource development, and diversity promotion.

Ensure high product quality: We believe that it is our responsibility to continue to provide our customers with a stable supply of high-quality, safe, and reliable products and services.
We also believe that product quality is not only about the product’s functional properties but also involves important attributes such as its safety for users. We therefore focus on improving our product safety.

Strengthen governance: As a corporate group with a global value chain, we believe that robust compliance and risk management are essential building blocks for the sustainable growth of our business.
We are also continuously strengthening our corporate governance in order to enhance the soundness and transparency of management.

Building a Sustainable Supply Chain: For our group, which is building a global supply chain, we believe that responding to ESG risks such as human rights and climate change is important from the perspective of corporate social responsibility and business continuity.
For this reason, our group has established CSR procurement guidelines and asks our business partners to conduct business activities that take into account not only quality, cost, and delivery, but also ESG.

Emphasize coexistence and co-prosperity with local communities: With our numerous business sites, we believe that fostering a spirit of coexistence and co-prosperity with local communities is essential for business continuity.
We therefore contribute to the development of local communities by engaging in social contribution activities that leverage the resources and strengths of our Group.
Through such activities, we seek to strengthen employee engagement and raise social and environmental awareness.

Identification Process

(1) Extraction of Issues: After reviewing the SDGs, SASB, ISO 26000, and GRI standards, as well as the initiatives of other companies in the same industry, we identified the most relevant ESG material issues for machinery manufacturers.

(2) Narrowing Down of Issues: Importance to the Society and Stakeholders

Mapping of Issues Extracted

Through dialogue on ESG material issues with 14 head office divisions and 15 main business divisions, as well as listening to the opinions of external advisors, we have narrowed down ESG material issues based on the following two axes: the scale of impact on the society and how important those issues are to our Company.
At management meeting and business strategy committee, which are made up of executive officers, we reported on the progress of these activities and confirmed that there were no objections to the narrowed down ESG material issues.

(3) Expert Hearings

In order to confirm the validity of the narrowed-down ESG material issues, we held a hearing with Ms. Mari Yoshitaka as the opinion of sustainability expert.
She commented that material issues for creating value should incorporate not only issues related to the environment but also related to society (eg.a decline in the labor population).

*Principal Sustainability Strategist, Deputy General Manager, Corporate Planning Dept., Mitsubishi UFJ Research and Consulting Co., Ltd.

(4) Resolutions at the Board of Directors Meetings: We reviewed the framework and importance of the issues through hearings with internal parties and outside sustainability experts.
The resolution for these issues was adopted as management materialities at the meeting of the Board of Directors held in March 2020.
We will continue to monitor trends in social and environmental issues and regularly review our ESG material issues.