Digest 2016 - Daido Metal · market for plain bearings, and the only manufacturer in the world to...

13F Nagoya Hirokoji Bldg.2-3-1 Sakae, Naka-ku, Nagoya, Aichi 460-0008, JAPAN

DAIDO METAL CO., LTD.

● Universal Design Fonts are utilized to ensure good visibility and legibility.

［ Contacts ］● For inquiries regarding environmental or safety issues:　Environmental & Safety Management Dept. 　TEL 81-568-61-2976 FAX 81-568-62-1361● Other CSR-related inquiries:　General Affairs Dept.　TEL 81-52-205-1400 FAX 81-52-205-1408

http://www.daidometal.com

Corporate Social Responsibility Information Digest

2016

Global NetworkMajor Products by Business SegmentCompany Outline

Message from Management

Special Feature 1

Daido Metal Group’s products that contribute to society Plain bearings manufactured by Daido Metal Group contribute in a multitude of ways

Special Feature 2

Daido Metal Saga commences operationsDaido Metal Group bolsters production operations in accordance with the goals of its Midterm Business Plan

DAIDO METAL GROUP CSR Policies

Organizational Governance

Human Rights/Labour Practices

Environment

Consumer Issues

Fair Operating Practices

Community Involvement and Development

2

4

6

8

9

10

11

14

15

16

18

CONTENTSMajor Products by Business Segment Company Outline

(As of 31 March 2016)

Global Network(As of 1 July 2016)

(As of 31 March 2016)

80,000

60,000

40,000

20,000

0

(JPY millions)

(FY)2011 2012 2013 2014

■ Sales

61,673

70,326

57,454

70,886

58,978

77,350

67,269

85,015

2015

64,665

81,400

North America

Japan

Asia

ChinaEurope

DAIDO METAL U.S.A. INC. DETROIT H.Q.

DAIDO METAL U.S.A. INC. BELLEFONTAINE OFFICE

AMERICAN TECHNICAL CENTER

CHUNG YUAN DAIDO CO., LTD.

EUROPEAN TECHNICAL CENTER (UK)

DAIDO METAL GERMANY GmbH

DAIDO METAL RUSSIA LLC

DAIDO METAL CZECH s.r.o.

DAIDO METAL KOTOR ADTHE EUROPEAN TECHNICAL CENTER

PT. DAIDO METAL INDONESIA

DAIDO PRECISION METAL (SUZHOU) CO., LTD.

BBL DAIDO PRIVATE LIMITED

DONGSUNG METAL CO., LTD.KOREA DRY BEARING CO., LTD.

DAIDO INDUSTRIAL BEARINGS EUROPE LTD.DAIDO METAL EUROPE LTD.

CHUNG YUAN DAIDO (GUANGZHOU) CO., LTD.

DAIDO METAL MEXICO S.A. DE C.V.

DAIDO METAL MEXICO SALES, S.A. DE C.V.

DYNA METAL CO., LTD.

■ PolicyThe CSR activities that are carried out by DAIDO METAL CO., LTD and some of its affiliated companies are detailed in this report. This report is based on DAIDO METAL GROUP'S CSR philosophy. This report also aims to facilitate communication with our stakeholders as well as raising awareness for all DAIDO METAL employees.

■ ScopeThis report covers the activities of DAIDO METAL GROUP and some of its subsidiaries.

■ Period under reviewFY 2015 (April 2015 - March 2016) In some cases, information was updated to include more recent activities.

■ Relevant guidelinesISO26000Ministry of the Environment’s “Environmental Reporting Guidelines (2012 version)”,

■ Publication dateNovember 2016 (A revised edition will be published in autumn 2017.)

Non-consolidated Consolidated

Company Name

Established

Head Quarters

Representatives

Common Stock

Sales Amount

Number of Employees(Regular Employees)

Main BusinessOperations

Main Domestic Production Facilities

Main Domestic Sales Offices

Subsidiaries


4 November 1939

■ Nagoya Office13F Nagoya Hirokoji Building 2-3-1 Sakae,Naka-ku, Nagoya, Aichi 460-0008, JAPAN

■ Tokyo Office17F Tennozu Central Tower 2-2-24 Higashi Shinagawa,Shinagawa-ku, Tokyo 140-0002, JAPAN

Seigo Hanji, Chairman & Chief Executive Officer (CEO)Kotaro Kashiyama, President & Chief Operating Officer (COO)

JPY 7,273 million

JPY 81,400 million (Consolidated) JPY 64,665 million (Non-consolidated)

4,637 (Consolidated)1,285 (Non-consolidated)

● Automotive engine bearings● Other automotive bearings● Non-automotive bearings and other products

Inuyama Factory (Located on Inuyama site)Maehara Factory (Located on Inuyama site)Bimetal Division factory (Located on Inuyama site)Gifu Factory (Located in Gifu prefecture)TMBS (Turbo Machinery Bearing Systems)(Located on Inuyama site)

Tokyo Branch, Nagoya Branch, Osaka Branch, Kita Kanto Sales Office,Hamamatsu Sales Office, Hiroshima Sales Office, Kyushu Sales Office

● 8 domestic subsidiaries● 16 overseas subsidiaries　 (6 in Asia, 1 in China, 6 in Europe,　　3 in North America)

Shock absorber bushesThrust bearings for turbochargers

Large-sized Ship Engine BearingsThe bearings used in the diesel engines of large ships are enormous, often having a diameter of more than one meter.DAIDO METAL is the global leader in bearings used for large ship engines, with a 50%* share of global sales.(*Company estimate for 2015)

Bearings for Construction Equipment and Medium and High-speed Diesel EnginesDAIDO METAL has a large share of the domestic and global markets for bearings used in the engines of construction and excavator equipment, as well as medium and high-speed diesel engines. The company’s bearings are used not only in the engines, but in other components of construction equipment including agricultural equipment.

Industrial Machinery Bearings and Other ProductsDAIDO METAL has been expanding its operations to include bearings for a broad range of industrial equipment, ranging from office equipment to power generation turbine, high-speed train and coach axles, shock absorption and vibration control equipment, among others. The company is developing and selling products other than bearings such as lubrication application products including pumps and centralized lubrication equipment.

Automotive Engine BearingsA typical car engine contains around 20 bearings. DAIDO METAL is a leading manufacturer of these products, controlling a 32%* share of the global market for automotive engine bearings. (*Company estimate, as of 2015)

Other Automotive Bearings (Automotive Parts Bearings)　Bearings are used not only in automotive engines, but in many other key automotive parts. DAIDO METAL makes bearings for many automotive parts, particularly automotive turbochargers, shock absorbers and other components, holding a large share of the domestic market for these bearings.

Bearings used in key automotive components (transmissions, shock absorbers, compressors, steering columns, etc.)

Main products

Main productsBearings used in automotive engines (passenger cars and trucks), racing engines, motorcycle engines, etc.

DAIDO PLAIN BEARINGS CO., LTD.NDC CO., LTD.DAIDO INDUSTRIAL BEARINGS JAPAN CO., LTD.DAIDO METAL SAGA, CO., LTD. (Established on April 10, 2015)DAIDO METAL SALES CO., LTD.NDC SALES, CO., LTD.DAIDO LOGITECH CO., LTD.ASIA KELMET CO., LTD.


Bearings for medium and high-speed diesel engines

Bearings for low-speed diesel engines

Turbo machinery bearings (for turbines, etc.)

Rotary pumpsCentralized lubricationequipment (MR-LUB)

Regional HeadquartersSales subsidiariesProduction subsidiaries

R&D centers

DAIDO METAL CSR Report 2016 3DAIDO METAL CSR Report 20162

The goal of the DAIDO METAL GROUP is to apply our expertise in plain bearings to all industries that use such products. In this way, we aim to broaden our global impact, and capture the top share of the market for all types of plain bearings. The company’s current Midterm Business Plan (a six-year endeavor which runs from FY2012 to FY2017) provides the blueprint for business expansion on a global basis.The main objectives of the plan are:1. To consolidate our position as the leader* in the global market for plain bearings, and the only manufacturer in the world to serve all segments of the bearings market. (*based on company estimates)2. To further increase our market-leading share* of the market for automotive engine bearings ‒ one of the core products in the overall plain bearings industry. (*based on company estimates)3. While enhancing the company’s existing leadership in the market for bearings used in large ship engines, to also pursue the largest share* of the global market for non-automotive engine bearings, including those used in turbo machinery, construction equipment and smaller marine-use diesel engines. (*based on company estimates)4. To build and expand a network covering five regions worldwide, in order to support growth in both domestic and international sales.5. To pursue R&D activities that cultivate our status as the technological leader in plain bearings, and apply these technical skills to address the needs of customers in each region worldwide.6. To establish a solid financial base to support operations.

In the first stage of this effort, between FY2012 and 2014, the company began to rebuild and expand its business foundation, particularly by creating a larger, more global based production capacity in order to

support sales growth. Building on existing facilities, the Group developed a more solid production structure spanning five main regions ‒ Japan, North America, Europe, China and Asia (excluding -Japan and China).Between FY2015 and 2017, we are moving into the second stage of this effort. In the final year of the current plan Daido Metal aims to increase “consolidated sales to ¥111 billion JPY, with an operating profit of ¥16.7 billion JPY and an average operating profit margin of 15%”. In addition, we aim to capture “The leading global share of the market for plain bearings in all industries”.

The Daido Metal Group’s CSR philosophy states that “the Group strives to act as a responsible corporate citizen, not only by producing high-quality products that contribute to society in general, but also by faithfully observing all laws and regulations and behaving with the highest standard of responsibility (CSR) toward customers, shareholders, employees, business partners and the local communities in which we operate.” This philosophy guides all of our CSR activities.During FY2015, the company focused on developing new products and materials that reduce energy consumption and environmental impact, conducted a variety of IR activities and presentations at exhibitions in each of the company’s business segments, and bolstered PR activities. In the area of product quality, our QC circle groups held global quality control conventions, making advances in product quality and fostering QC activities on a global basis.The company is taking steps to improve communication with the citizens of towns where Daido Metal Group factories are located and thus make a more valued social contribution. For example, the Gifu Plant held a summer festival for local residents, and co-sponsored the “Fureai Trio Concert” in Inuyama City. We also continue to offer factory tours and events for elementary school students in the region.Environmental management efforts also are a priority, as

the company continuously seeks ways to reduce CO2 emissions (mainly through energy-saving measures) and reduce the amount of industrial waste generated by its operations. Finally, in the area of safety and personnel training, the company has implemented measures to improve the working environment and introduced programs such as the Job Return System, to provide employees with a pleasant and flexible working environment, where they can develop their skills and promote their careers.

The business environment in which Daido Metal operates

is changing at a frenetic pace. Nevertheless, the company strives to respond astutely and appropriately to the needs of every market in which the Group operates, developing new products, cultivating new markets and exploring new applications for our technology, while also trying to minimize costs, enhance competitiveness and improve customer service. Furthermore, we are working to strengthen the systems of compliance, corporate governance, and CSR, in an effort to provide value and earn the trust of shareholders, business partners, and all of the Group’s stakeholders. The entire Group will pool its efforts in this ongoing effort to enhance corporate value.

All members of the Daido Metal Group are working together to boost corporate value, and thereby benefiting all of the Group’s stakeholders.

*Top share of the global market (based on company estimates for 2015)

Midterm Business Plan(FY2012 - FY2017)

Gain the largest global share of all fields

“Together To The Top”

Expand and upgrade operating base to help capture top market share

Stage 2Stage 1 [FY2015 - FY2017][FY2012 - FY2014]

S l o g a n

Message from Management

Establishglobal systemsfor production,sales and R&D

Increase productivity(new manufacturingmethods, bimetal,

quality)

Strengthenproduction control(Pull production)

Increaseglobal production

capability

Strengthen R&Dto maintaintechnicalsuperiority

Strengthendevelopment ofnon-automotive

fields

Establishstrongfinancialfoundations

Improvequality

Stabilisemanagementat all globallocations

Group object ives

Seigo Hanji, Chairman & Chief Executive Officer (CEO)

Kotaro Kashiyama, Kotaro Kashiyama, President & Chief Operating Officer (COO)

Daido Metal contributes to society through its day-to-day operations, striving to be the global market leader in plain bearings Midterm Business Plan ‒ “Together To The Top”

Daido Metal’s approach to corporate social responsibility (CSR)

Working as a Group to enhance corporate value over the medium and long term.

*

*

Bearings forSmall Turbo

PolymerBearings

Bearings forLow SpeedEngines

TurboMachinery Bearings

Current Target

Bearings forMedium and High-Speed

Disel Engines

Automotive Halfshell Bearings*


Daido Metal Group’s products that contribute to society

Daido Metal’s turbo machinery bearings are used in a thermal power plant.

Environment and energy-related products

In addition to the engine bearings of automobiles, the company makes bearing components used in turbochargers, steering columns, shock absorbers, transmissions, and a multitude of other automotive parts.

Automobiles and trucks

The bearings used in the diesel engines of large ships can be enormous, often having a inner diameter of more than one meter.

Shipping

Oilless bearings are used in canal locks, water wheels, and other infrastructure-related industrial equipment.

Infrastructure and industrial equipmentDaido Metal’s special

resin-coated bearings help to increase the reliability of hydroelectric power plants.

Environment and energy-related products

The marks indicate applications for Daido Metal Group products.

The Group manufactures a variety of products that improve the safety and convenience of home appliances and interior furnishings, to enhance the living environment of your home.

Products that enhance the living environment

Civil engineering and construction equipment

Daido Metal bearings are used in both the engines and the cylinder joints of excavator and other types of construction equipment.

1SpecialFeature

Plain bearings manufactured by Daido Metal Group contribute in a multitude of ways


On 10 April 2015, Daido Metal Saga was established in Takeo City, Saga Prefecture. This manufacturing subsidiary produces bearing materials to meet both domestic and overseas demand. The company commenced operations during FY2016.

2SpecialFeature Daido Metal Saga

commences operationsDaido Metal Group bolsters production operations in accordance with the goals of its Midterm Business Plan

A ceremony was held in Saga to celebrate the opening of the new plant and the start of operations at Daido Metal Saga. Attending the ceremony were Saga Prefecture Governor Yoshinori Yamaguchi, Takeo City Mayor Tadashi Komatsu.

Working with the local community to foster growth as a well-respected corporation.Daido Metal Saga became the newest member of the Daido Metal Group.In the past most of the Group’s domestic production activities were handled by plants on the main island of Honshu, but the establishment of a subsidiary in Saga Prefecture on Kyushu island (Daido Metal Saga) expands our production scope while also dispersing production activities as a hedge against the impact of natural disasters. The facility is located close to Imari Port and a major interchange on the expressway. Saga Prefecture is well known for its diligent and hard-working citizens. Following the decision to open a new subsidiary in Saga, the Group began preparing to commence operations, and held a completion ceremony on 24 March 2016. On 1 April a ceremony was held at the Inuyama Site Office of the parent company to welcome the new employees of Daido Metal Saga into the company. On 1 June the new facility in Takeo City held its opening ceremony.At present, the plant is manufacturing bimetal materials to be used in bearings, and it has 50 employees including local workers. In the future we hope to work closely with the employees of Daido Metal Saga as well as the local citizens of Saga, as we strive to become a valued corporate member of the local community.

DAIDO METAL GROUPCSR Policies

Established : 10 April 2015 Commenced operations : June 2016Location : Takeo Kitagata Inter Industrial Park, Takeo City, Saga PrefectureBusiness activities : Production of bearings materials, etc.

Daido Metal Saga Co., Ltd.

A welcoming ceremony for new employees of Daido Metal Saga was held at the Inuyama Site Office.

Welcoming ceremony for new employees(1 April 2016)

New plant opening ceremony(1 June 2016)

(From left :) Mayor Tadashi Komatsu, Daido Metal Chairman & CEO Seigo Hanji, Governor Yoshinori Yamaguchi

Corporations have a responsibility to behave as responsible “citizens” or members of society. With this in mind, if the DAIDO METAL GROUP hopes to continue to grow, it must not only contribute to society as a product manufacturer through corporate activities, it must also behave in a responsible way, respecting laws and regulations while making a positive contribution to society through non-business activities. By striving to always act in this way, the company can earn the respect and support of its clients, shareholders, employees, business partners, and the local community in which it operates. To meet the above objectives, the DAIDO METAL GROUP has introduced a multitude of programs and activities which cultivate the qualities of self-discipline, self-correction, creativity and responsibility in every employee or executive officer, under the slogan: “Self-discipline, Self-correction and Creativity.”

DAIDO METAL GROUP’s Approach to CSR

Increase awareness ofDAIDO METAL GROUP’s rolein society while increasing

corporate value

Cultivating Self-discipline,Self-correction and Creativity

Contribute tosociety as a

manufacturer throughcorporate activities

Comply with allpertinent laws andregulations anddemonstrate

responsibility throughactive contributions

to society

Our Corporate Philosophy Our Principles Our Principles

1.Our Duty: We hold ourselves responsible for the happiness of everyone in our organization and the contributions we make to global society.

2.Our Resolve: We will create a vigorous and open-minded corporate culture through diligent self-discipline and ethical behavior.

3.Our Foundation: We will learn from our markets, respond to our customers' requirements, and surpass our customers' expectations.

4.Our Approach: We will devote ourselves to creation, innovation,and the realization of dreams.

5.Our Objective: We will strive to be the world leader in tribologythrough constant technical improvement, development, and innovation.

1. We will always approach business from a global perspective.

2. We will always attend to the needs and desires of our customers.

3. We will continue to recognize the importance of the environment.

4. We will continue to value individuality and work to achieve synergy between people.

5. We will always remain open to new ideas and proposals.

6. We will always respond with speed and agility.


■ Corporate Governance Structure (As of 1 July 2016)

Nagoya Stock Exchange Stock Investment Summer Seminar 2015 (Chuden Hall, 17 September 2015)

Website

Nagoya Stock Exchange IR Expo 2015 (Fukiage Hall, 24-25 July 2015)

■ Training Structure

Position-specific Training Daido Metal College Courses

Departmentmanagertraining

Managementprogram

Self-improvementtraining

Selectivetraining Management

training priorto overseassecondment

Training forthird-year employees

Training forsecond-year employees

Follow-up training fornewly hired employees

Training program fornewly hired employees

Technical instructio

n

Entry-level course

Mid

-level course

Training fo

r Sup

ervisor

cand

idates I

Training fo

r Sup

ervisor

cand

idates II

11Division

Managers

Topmanagement

level

DepartmentManagers

ExperiencedEmployees

GeneralEmployees

Newly HiredEmployees

22

The Daido Metal Group has adopted a Board of Directors structure as part of the continuing effort to earn the trust of shareholders, customers, employees and other stakeholders, by pursuing a future of sustainable growth and endeavoring to boost corporate value over the medium

and long term. An executive officer system has been introduced in order to further elevate management efficacy, and the company has appointed board members from outside the company in an effort to improve transparency, fairness and propriety. These external directors perform an oversight function to monitor the performance of other directors, and external auditors have been appointed to strengthen the Group’s auditing functions.

Corporate Governance Structure

■ Personnel principlesAs global markets grow increasingly competitive, a company like Daido Metal needs to respond swiftly to the changing conditions and steadily improve productivity to enhance its global competitiveness. Employees are the cornerstone of this competitiveness.

The company’s personnel principles emphasize “self-discipline” (maintaining personal sense of responsibility and swift action), “sincerity” (teamwork and a desire to satisfy customers and society as a whole) and “ambition” (a constant desire to develop creativity and improve performance). The company strives to foster a working environment in which all employees can make the most of their abilities and take both pride and enjoyment in their work.

■ Employee Training Programs DAIDO METAL’s Human Resources Planning Division oversees a training system which provides employees with continuous training in the skills and qualities needed at each stage of their employment. The knowhow, technical skills and expertise that the company has amassed over the years is passed on to workers through “Daido Metal College (*1)”, and new training programs are developed over the course of the year. By educating employees at each stage of their career, the company promote effective personnel development throughout the company.

Personnel Training

Investor Relations (IR) Activities

Organizational Governance[Corporate Governance]

Human Rights/Labour Practices[Personnel training and working conditions]

Company policy on human rights Daido Metal’s policy on human rights is spelled out in the “Performance Standards” for the Daido Metal Group. All employees are expected to understand this policy and apply it in all company activities.

■ Respect for Human Rights・We maintain accepted moral standards and a high standard of ethics. We comply with labor laws and conform to rules. We respect individuals, do not discriminate against others, strive to be considerate to others and improve the working environment and human relations.・We respect one another’s personal privacy and do not infringe on human rights through discrimination for reasons of race, skin color, beliefs, nationality, gender, national origin, religion, physical appearance, disability or language. We will not tolerate any form of sexual harassment or abuse of power.

Investor relations activities are conducted with the aim of actively increasing corporate value and gaining favorable evaluations from financial markets.

■ IR-related EventsDaido Metal took part in the “Nagoya Stock Exchange IR Expo 2015”, and the “Nagoya Stock Exchange Stock Investment Summer Seminar 2015”. This year we again had the opportunity to communicate directly with investors, to discuss the content of our business and the goals of our Midterm Business Plan.

■ Global Internet website launchedIn February 2016, Daido Metal upgraded its online presence with the launch of an Internet site aimed at both domestic and overseas stakeholders. The new site provides information on company products, financial results announcements, search functions that help users locate specific products, and even download CAD data on some of the company’s products. In the future we will continue the effort to inform stakeholders worldwide, by disseminating information promptly and effectively.

■ Earnings announcement and explanatory meeting (Nagoya Stock Exchange)Daido Metal Group convened meetings for institutional investors to discuss results of the second half of the year and year-end results. The Chairman and CEO was on hand to describe the company’s operations, announce the earnings results, and discuss the progress of the current Midterm Business Plan. The company will continue its proactive IR effort to attract the interest of institutional investors.

Auditors(3 members including 2 from outside the company)

Auditing

Selects and dismisses Board members

Suggestions on how to manage operations

Reporting onoperatingactivities

Instructions

Proposals

Advice

Reporting

• Director and Managing Executive Officer (1 member)• Executive operations manager (5 members)• Senior operations manager (4 members)• Operations manager (8 members)

Board of Directors

Board of Auditors

Auditing Center(internal auditing activities)

Corporate auditors(accounting auditor)

Individual operating divisions

Board Members(5 members including at least 2 from outside the company)

(Reports directly to the President & COO)Selected from among Board members,executive officers and managers

Reporting

• Chairman & Chief Executive Officer (CEO)• President & Chief Operating Officer (COO)

Chief Representative Officers (2 members)

Corporate GovernanceCommittee(7 members)

Corporate Activities EthicsCommittee(10 members)

Risk ManagementCommittee(12 members)

Advisory Board(4 members)

Auditing

Auditing

CooperationCooperation

(Auditors’ evaluation and report)

Cooperation

Termination

Selection

Decisions on the appointment or termination of corporate auditors

Shareholders Meeting

Management Strategy Council

Management of operations

Includes 2 members from outsidethe company and 2 from within

Selection or terminationNon-reappointment

　　Selective training for management-level personnelThis program focuses on management-level personnel, training them to become the next generation of company executives. The program seeks to develop leadership skills, foster a global perspective, and teach managers the skills needed to manage and lead company operations in the future.

　　Training for employees selected for overseas transfers (“management training prior to overseas secondment”)This program aims to give management-level personnel the knowledge and management skills needed to assume responsibilities at overseas subsidiaries and affiliate companies. This wide-ranging program includes cultural and historical knowledge for their area of assignment. In light of current trends in world affairs managers also need the decision-making principles and skills to handle crisis management situations.

11

22

(*1) Daido Metal College, established in May 2005, offers programs that help employees hone their technological skills, hand them down, and also developmental qualities needed in their individual job roles.

Org

an

izat

ion

al

Go

vern

an

ceH

um

an

Rig

hts/

Lab

ou

r Pra

ctices


Number of employeesPercentage of work force

（%）

(FY)2011 2012 2013 2014 2015

35

30

25

20

27 2729

32 31

2.0

1.5

1.0

0

1.8

2.07 2.02 2.072.21

2.02

(People)

Government statutory target level

Employees taking part in the reduced hours program (Men)Employees taking part in the reduced hours program (Women)

(FY)2011 2012 2013 2014 2015

15

10

5

0

12

6 6

11

11

11

1010

55

(People)

Employees taking child care leave (Women)Employees taking prenatal/postnatal leave (Women)

Employees taking child care leave (Men)

2011 2012 2013 2014 2015

25

20

15

10

5

0

20 21

18

15

18

88

88141488

77

77

22

991212

771010

(People)

(FY)

A state of patrol by manager of management and labor

Promoting Diversity

■ Work-life BalanceIntroducing a new Job Return programDuring FY2016, the company introduced a new “Job Return program” which is intended to allow full-time employees once to resign from a job for reasons such as child care, nursing care, or the relocation of a spouse, and to be rehired to their job when they are able to do so. This program offers employees new options to balance the demands of work and personal life. In the future, we hope that this program will offer employees greater security and the ability to contribute to Daido Metal over a longer period of time, thus reaping benefiting for those who use the program and the company alike.

Conditions of child care leave programThe company is continuing to seek new ways to improve the working environment in ways that help parents to balance work and child-rearing commitments. While parents are on child-care leave the company continues to periodically send them company information, and arranges a meeting with the employee’s direct supervisor and the head of personnel when they are ready to return to work. This support helps to ensure that the employee can make a smooth transition back into the workforce. During FY2015 18 employees took either prenatal/postnatal leave or child care leave, the latter category including two fathers.

Safety-related ActivitiesConditions of short-term reduced-hours programDaido Metal is continuing to seek new ways to improve the working environment in ways that help parents to balance work and child-rearing commitments. In FY2015 the company introduced a program that allows parents to apply for temporary reductions in their working hours in order to care for children. The program, which applies to parents with children who are preschool age was expanded to include parents of elementary school children up to third grade. The program allows the employees to adopt more flexible working hours, and the number of people applying for the program is increasing. During FY2015, eleven individuals took advantage of the program.

Employing workers with disabilitiesDaido Metal has been very proactive in employing individuals with disabilities, surpassing the government’s statutory employment targets in FY2015.

Human Rights/Labour Practices[Personnel training and working conditions]

Fundamental PolicyBased on its people-oriented management philosophy,DAIDO METAL does its utmost to protect the health andsafety of its valued employees. Maintaining high levels ofemployee safety is a top company priority, and the companyinvests whatever management resources are required tomaintain the highest possible levels of safety.

Operations covered byOHSAS18001 certification• Inuyama Plant • Maehara Plant• TMBS Plant • NO.4 company • Bi-Metal Division • Gifu Plant • Environmental & Safety Management Dept.

Certificate number: JQA-OH0045

Workers learning to avoid potential back injuries when lifting heavy objects

■ OHSAS18001 CertificationDAIDO METAL has adopted a management philosophy that places great emphasis on people. Accordingly, the company pursues employee safety policies aimed at completely eliminating workplace accidents. The company’s domestic production facilities have been certified as compliant with the global standards set for management systems under OHSAS. The company has continuously complied with these standards since 2003.

■ Implementing “Safety Week” at all Domestic Plants　 Cooperation between management and 　 the workforce to address risk 　 (status of plans to address accident/　 risk assessment targets)In conjunction with the Safety Week (held in July) at all domestic plants, Daido Metal conducts safety checks involving representatives of company management and labor unions, to address worker safety.

They re-confirm the progress of measures taken in response to past factory incidents. Risk assessments are conducted and the status of safety programs are evaluated. These activities help boost safety awareness. Similar events are conducted as part of Sanitation & Health Week (in November), and Safety Data Sheets (SDS) are prepared to support risk assessments of potentially hazardous chemicals. To further raise awareness of workplace safety, workers were informed of a stress check system which the company introduced in December 2015.

■ Experience learning fosters safety awarenessOne key element of safety training is something we call “KYT” (kiken yochi training), which teaches employees to foresee potential dangers before they occur. Workers are also taught the proper way to operate machines to give them direct, experiential understanding of dangers.

■ Global safety activitiesDaido Metal is taking steps to prevent fires or other workplace accidents and enhance disaster preparedness at overseas plants as well. By providing information on past accidents and fires we can prevent them from happening again. In 2015, in addition to providing information, the company also began to monitor the actual safety training activities that take place at overseas facilities, and took steps to sharpen safety awareness.

Hu

ma

n R

igh

ts/

Lab

ou

r P

ract

ice

s Hu

ma

n R

igh

ts/La

bo

ur P

ractice

s


Lighting inside plant facility Lighting in office buildings

Mon Tue Wed Thu Fri Sat Sun Mon

Compressor 2 Volume of air flow

Compressor 1 Volume of air flow

Diagram showing load volume of air used by compressors

Diagram showing load volume of air used by compressors

■ Details of changes

45,000

40,000

35,000

30,000

（ t ）650

600

550

500

(g-CO2 /thousand JPY)

Emissions per unit of productionCO2 emissions■ Trends in CO2 emissions

(FY)20152011 2012 2013 2014

* CO2 emissions volume is calculated using the methodology provided by the “Energy Saving Act”, which can change from year to year.

633.3648.3 618.8618.8

40.91340.91339,56939,569 40,35740,35743,01843,018565.1565.1609.3609.3

38,87838,878

Presentation at the “Global DQC Circle Convention”

Members of the American Technical Center (ATC)

Event at Université de Poitiers, France

Q&A session following a technology presentation

Half-shell bearings for automobiles

Turbocharger bearings

“Del-Eco” electrode sheets for capacitors

Environment

Efforts to Address Environment

DAIDO METAL GROUPEnvironmental Policy

Fundamental philosophyDaido Metal Group views the global environment as a precious resource for all people to share, and considers protection of the environment to be one of the most important issues facing mankind. The company will focus all of its efforts and technology on preserving the environment.

Fundamental policies1) The Daido Metal Group will fulfil its responsibility to preserve the global environment, while observing all relevant laws and regulations.

2) The entire Group will take steps to address environmental issues and strengthen environment management.

3) In all work activities, comprehensive efforts will be made to reduce energy consumption and use of materials, recycle materials, and reduce industrial waste to a minimum.

4) Through the development of products and technologies, the Group will employ its overall technical abilities in an effort to preserve and clean up the environment.

5) The Group will take active steps to inform customers, the local community and other related parties of its efforts to preserve the environment, and promote communication regarding the issue.

6) Through environmental education and informative activities, the Group will seek to boost environmental awareness among all employees, and encourage them to take it upon themselves to participate in environment-related activities.

■ Reducing Power ConsumptionThe Group does its utmost to combat the risk of climate change and make the most efficient use of natural

resources, promoting activities to cut power consumption. The company aimed to “emit less CO2 than in 2014” in 2015 and due to energy saving measures and a reduction in production amounts was able to limit emissions to 40,913 tonnes which was down 5.1% on 2014. However, one key measure of energy efficiency - CO2/1000JPY of sales - showed an increase of 1.5% on 2014 to 618.6g. The main reason for this was the lower sales recorded in 2015. This mainly reflected the sales decline registered during the fiscal year.

■ CO2 Reduction at Company Site OfficesA new compressorThe fabrication process in our materials factories requires the use of two compressors. One of the two compressors in operation at the plant had already been converted to an energy-saving inverter-type model. When it came time to install a new compressor, the second one was also switched over to the inverter-type model. This reduced electric power consumption particularly during weekend operations requiring less air volume.

Conversion to LED lightingAnother measure that the company is taking to reduce power consumption is to install energy-saving LED bulbs at its offices and factories.

■ Promoting environmental management systems Daido Metal Group Environmental PolicyDaido Metal recognizes the need for all operations to conform with principles of environmental protection, and to contribute to a sustainable society. With this in mind in April 2004 we adopted the “Daido Metal Group Environmental Policy.” The slogan “limited resources and limited emissions” reflects the company’s awareness of the need to minimize the impact of operations on the global environment. The Group as a whole will continue working energetically to ensure that Daido Metal remains an “environmentally friendly company”, contributing to a sustainable society.

Serving Customers

■ Quality Control (QC) policy for FY2015The company’s QC policy for FY2015 was developed to raise the initiative and self-reliance of company employees. The slogan for this year was “Take quick action not to ship bad parts to the next process. Turn PDCA cycle by seeing Genba & Genjitsu and achieve “Zero” recurrence!” This motto reflects the company’s dedication to improving quality.

■ DQC Circle Convention holds “Global Convention” to promote QC activities worldwideThe Daido Quality Control (DQC) Circle Convention is held once a year. In FY2015 the company opened up the convention to participants from around the world, in a “Global Convention” as it does once every five years. Nine groups from the company’s domestic plants were selected in a preliminary convention, and joined three groups selected from overseas offices (Indonesia, Thailand and China) to take part in the Global Convention. All twelve groups had a chance to report on the quality control achievements they have made. The slogan for this year’s convention was: “New QC Circle Activities.” We believe that these conventions, and the energy generated by QC Circle activities, are contributing to the “personal growth of participants, and energizing the work environment at our plants.”

■ Strengthening the research & development structure (Establishing technical centers in the US and Europe)In 2014 the Daido Metal Group established the European Technical Center (ETC) as part of its efforts to bolster the global research and development structure. This structure will enhance the Group’s ability to provide technical support and develop new technology to meet the actual needs of customers.Furthmore the American Technical Center (ATC) was established in 2015 and this facility allows us to respond even more swiftly to provide technical support, to design bearings with the features that customers need, and to reduce energy loss and contribute to a longer

operating life for the equipment in which Daido Metal bearings are installed.

■ Introducing new materials and new technologies at exhibitions and academic conferencesIn the US, Daido Metal has a history of cooperation with the Society of Automotive Engineers, which is the largest exhibition for automotive technology in the world, and the Group also has been an active participant in the EDF/Pprime Workshop, which brings together specialists in the turbo machinery bearing technology. These activities have attracted attention and interest from many people in related fields. For example, in FY2015 the company published the results of its research into the tribology characteristics of special resin-coated bearings, which are used in hydroelectric power plants both in Japan and overseas.In addition, the company has exhibited “Del-Eco” electrode sheets used in lithium ion batteries, which take the power storage technology used in engine bearings and applies it to enhance the electrical storage capacity of batteries.

■ Introducing new technology and materials for automotive bearings (Tokyo Motor Show)At the Tokyo Motor Show on October 28, Daido Metal unveiled new materials and new technology for automotive bearings. The company has developed a new type of coated bearings for the half bearings used in the start/stop mechanism of engines. These bearings use a solid lubricant film coating without environmently hazardous substances to reduce the bearing and prevent seizing, thus greatly limiting the environmental impact of engines. The company is steadily expanding the range of applications for these new products. The company also introduced the bearing for small turbo chargers with wear-resistant and seizure-resistant bearings for turbochargers at this Auto Motor Show.

Consumer Issues[Product Quality Control and PR Activities]

En

viro

nm

en

tFa

ir Op

eratin

gP

ractice

s


Explanatory session

Students at a Subcontractor Proceeds Act training session

Evening disaster drill

Legal Affairs Dept. Newsletter

Students at an insider trading course

Compliance Activities

■ Promoting compliance activitiesThe Daido Metal Group has a Code of Conduct which is designed to encourage constant awareness of compliance issues in all daily business activities. In addition to observing all laws, regulations and company rules, this code seeks to make compliance a fundamental element of all Group operations. To ensure that this focus on compliance continues the Legal Affairs Department actively disseminates information on compliance issues and holds training sessions.

■ Distributing information on compliance issues to employees News from Legal Affairs DepartmentThe “Legal Affairs Dept. Newsletter” is distributed occasionally to introduce legal issues and concerns to Daido Metal employees. The newsletter aims to make workers keenly aware of issues such as copyright infringement and leaks of confidential business information, which may occur unintentionally or accidentally.

■ Conducting compliance training sessionsInsider trading and Anti-Monopoly Act issues (in-house training)A part of ongoing compliance training activities in 2015, the Group conducted four sessions teaching personnel about the details of the Anti-Monopoly Act. The sessions are intended to ensure appropriate decision-making and compliance with this Act in the course of sales

activities and other operations. Teaching materials were developed to illustrate situations in which employees might face a possible compliance problem, and explain the appropriate responses. The company also held two training sessions during FY2015 to address “insider trading regulations” and their relation to compliance.

Subcontractor Proceeds Act (in-house training)In order to ensure appropriate adherence to regulations in the Group’s purchasing activities, the company held seven training sessions in FY2015 to boost awareness of the “Act Against Delay in Payment of Subcontract Proceeds Etc. to Subcontractors.” Not only were training sessions held to inform employees of Daido Metal about this Act, but teachers were also dispatched to conduct training sessions for employees of Group subsidiaries and affiliates. Furthermore, the sessions were not only provided to those employees who take part in purchasing activities, but also management-level personnel, to foster awareness of this compliance issue among all members of the Group.

Risk Management

The Risk Management Committee was established to oversee and manage all risks that affect the company. Risk management activities include “risk brainstorming” to identify all of the potential risks to Group business activities, “risk evaluation” and “risk response planning” to address each item, and “reporting results to the Risk Management Committee or the Board of Directors.” This cyclical process helps to reduce the risks affecting the Group and provide a structure for the Group to manage risks.In September 2015 the Risk Management Committee approved a report that compiled and addressed all the potential risks to overseas affiliated company in the Daido Metal Group. In February 2016, each office appointed a “Risk Management Director” to promote risk management activities at each overseas affiliate. In the future, the Group’s risk management

structure will strive to identify and plan for risks that might affect not only our operations in Japan, but also the operating environment at overseas offices, and thereby develop a risk management structure that can take appropriate actions for the Group as a whole.

■ Managing the supply chain To address safety and environmental issues at plants and offices (explanatory session)

On 25 June 2015, the company’s purchasing divisions conducted an explanatory session for subcontractors, to discuss safety and environmental issues. The company is naturally concerned with issues of environmental safety at the company itself, but it also addresses the issue from the perspective of our entire supply chain. Issues relating to safety and the environment need to be considered when making purchasing decisions, and all members of the supply chain need to fulfil their corporate social responsibility in all of their business.

■ Evening drills to practice the business continuity plan (BCP) ‒ (Disaster Risk) Drills conducted using “emergency earthquake warning system” and systems to “confirm personal safety”

At on 20 May 2015, 7:00 PM, the Inuyama Site Office conducted an evening earthquake evacuation drill. In FY2015 the company introduced an “emergency earthquake warning system” for use in evacuation drills, and a system for confirming the location and safety of employees during disasters.Training drills are conducted to confirm the number of evacuees, the number of people who returned home safely, and those who face difficulty in returning home. Once this is confirmed, the information is reported to the company’s disaster response headquarters. Other offices and affiliated companies are also carrying out periodic drills to test their preparedness for a natural disaster that strikes outside of business hours.

Environmental Safety Risk

Risk of fire/disaster

Committee Chairman: President &Chief Operating Officer (COO)

Vice-Chairman: Human ResourcesPlanning Division Manager

Risk Management CommitteeSecretariat (Legal Affairs Dept.)

Board Members andExecutive Officers (9 members)

Type of risk Division responsible

Bi-Metal Division

BCP Secretariat

Legal Affairs Dept.

Finance Dept.

Production-related risk

Fire/disaster risk

Sales risk

Financial risk

Business Promotion Dept. of each company

Technology Division

Quality Management & Planning Dept.

Environmental & Safety Management Dept.

Business Promotion Dept. of each company

Purchasing Dept., Legal Affairs Dept.

General Affairs Dept., Corporate Planning Dept.

Human Resources Planning Dept.

Information Systems Dept.

Technologicalrisk

Product quality risk

Environmental safety risk

Purchasing risk

Management risk

Human resources-related risk

IT-related risk

Production capacity risk

Technological development risk, information disclosure risk

Product failure risk, product liability lawsuit risk

Environmental pollution risk, safety and health risk

Fire/disaster risk (includes earthquake, flood, lightning and other disasters)

Customer-related risk, anti-monopoly law-related risk

Subcontractor Act-related risk

Business continuity risk, overseas expansion riskFinancial information reporting risk, insufficient funds risk and exchange rate risk

Human resources and labor-related risk

IT systems interruption risk, information disclosure risk

Risk Management Committee Members (As of April 2016)

Fair Operating Practices[Compliance and Risk Management]

Co

nsu

me

r Is

sues

Co

nsu

me

r Issues


Receiving the Certificate of Appreciation from members of the fire department

Tour guide provides an overview of the company

Explaining the applications of bearings

Employee of Daido Precision Metal (Suzhou) taking part in table tennis match (at back)

Company employees who took part in the competition

Participants relaxing in the cafeteria

Photo with children at the orphanage

Opening remarks at the festival

The bustle of the day

Tour of Inuyama Site Office (29 October 2015)

Tour of Gifu Plant (27 January 2016)

“Fureai Trio Concert”Performance at Inuyama international sightseeing center.

Plant tours for local elementary schools

Activities of overseas subsidiaries ■ Participation in safety training activities [Daido Metal U.S.A Inc.]As part of its effort to contribute to the local community Daido Metal U.S.A. Inc. has been regularly taking part in safety training activities including fire and rescue drills in the city of Bellefontaine, Ohio. The company received a Certificate of Appreciation from the organizers for its support. The safety training activities are conducted by fire and rescue personnel from the city of Bellefontaine who visit local schools and other public facilities to offer fire and first aid training and to raise awareness of safety issues. The company as a whole takes an active part in community activities including the maintenance of trees and landscaping in the plant and surrounding residential neighborhood.

■ Supporting local children in Nizhny Novgorod [Daido Metal Russia LLC]Daido Metal Russia LLC helps support an orphanage in Gorojets, in the Nizhny Novgorod region of Russia. Every year the company takes part in maintenance and repairs to the buildings, as well as providing supplies, and donating presents to the children.

Social contribution activities/localcontribution activities/sports activities

■ Plant tour event Daido Metal convened a “DMC* Open Doors Day 2015” in the Czech Republic [Daido Metal Czech s.r.o.]To commemorate the tenth anniversary of its establishment, Daido Metal Czech s.r.o. held an “Open Doors Day 2015”, on 21 November 2015. Employees at Daido Metal Czech and their family members or neighbors took part, with about 100 people visiting to take a tour of the plant and learn more about the manufacturing activities of the Daido Metal Group. Tour guides showed visitors products and materials produced by the Group, sorted by client industry, and explained the many applications for bearings. This event was intended as a way to make workers and their family members better acquainted with the Group’s operations.

■ Taking part in the Suzhou Industrial Park’s sports competition [Daido Precision Metal (Suzhou) Co., Ltd.]Daido Precision Metal (Suzhou) Co., Ltd. took part in a sports competition organized by Suzhou Industrial Park. Four company employees represented Daido Precision Metal at the event, and finished second in the table tennis competition.

Social Contribution Activities

■ Gifu Plant holds summer festival (9 August 2015)In order to recognize the contributions of company employees and their family members, Daido Metal’s Gifu Plant held a summer festival open to all residents of the area, fostering communication between the company and the community. The event featured refreshment booths, an open bazaar, and a variety of games such as ring toss and “balloon fishing.” Musicians and street performers provided entertainment on the main stage. Although it has been eight years since such a festival has been held it was extremely well received, with around 1,300 visitors attending.

■ Cooperating to stage local concerts Local companies cooperated to hold two school visits and concertsDaido Metal took part in organizing the “Fureai Trio Concert” in Inuyama City. In addition to the concert the “Fureai” program included performances at local schools and an “open market” in the lobby where social welfare groups from the area sold craft items and snacks. Initiated by violinist Kyoko Yoshida, these performances are closely allied with the company’s values. Daido Metal has co-sponsored the event in both FY 2015 and FY 2016.

■ Plant tours for local elementary schools (Inuyama Site Office, Gifu Plant)Plant visits by elementary school students have become a regular part of Daido Metal’s social contribution activities. The youngsters watch a video showing the nature of the company’s operations and tour the plant to see products and displays. After their visit the students wrote letters telling how much they enjoyed meeting the workers and watching the production activities. We hope to conduct many more such plant visits in the future, to let young people in the region know about the company’s business activities. During FY2015 plant visits were conducted at the Inuyama Site Office and at the Gifu Plant.

Community Involvement and Development [Social Contributions to Local Communities]

*DMC = “Daido Metal Czech”

Co

mm

un

ity Invo

lvem

en

t a

nd

Deve

lop

me

nt

Co

mm

un

ity

Invo

lve

me

nt

an

d D

eve

lop

me

nt


Digest 2016 - Daido Metal · market for plain bearings, and the only manufacturer in the world to...

Documents

Transcript of Digest 2016 - Daido Metal · market for plain bearings, and the only manufacturer in the world to...