Materiality for the Advantest Group Materiality for the Advantest Group

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Our Approach to Materiality

At Advantest, we believe that it is vitally important to first identify the impacts that our company’s operations have on society and the problems that society expects us to help solve, as a basis for clarifying the key issues that we need to address in our CSR activities, so that we can then go on to implement effective management based on specific key performance indicators (KPIs).
To this end, in FY2015 we used a three-step process with reference to the Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines, to identify what constitutes materiality for the Advantest Group.

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The Process of Identifying Materiality

Step 1: Collation of materiality aspect candidates and formulation of assessment criteria

A total of 50 materiality aspect candidates were identified on the basis of the 46 aspects listed in the Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines, the requirements of the EICC® *, industry standards such as SASB*, and information obtained from CSR surveys submitted to customers.
Assessment criteria were then formulated so as to be able to rank the materiality aspect candidates in priority order, taking into account the need to maintain consistency with respect to boundaries and business risk.

* EICC®: Electronic Industry Citizenship Coalition / Electronic Industry Code of Conduct

* SASB: Sustainability Accounting Standards Board (U.S.A.)

Step 2: Examining the degree of importance from both internal and external perspectives

A Materiality Identification Project Team was established (with Team members that included CSR Working Group members, representatives of relevant departments and responsible directors), and three Workshops were held. Materiality was examined in terms of both the level of importance as viewed by stakeholders, and the degree of importance to the Advantest Group.

Step 3: Identify materiality and set KPI

The identified materiality items were submitted to the Managing Executive Officers Committee for approval.
Following the approval of the materiality items by the Managing Executive Officers Committee, the Materiality Identification Project Team discussed the key performance indicators (KPIs). KPIs were set with 1 – 2 indicators per materiality aspect.

Identified Materiality Aspects and Corresponding KPIs Aspects

Category Identified materiality aspect Related G4 indicator KPI
Economy Economic performance G4-EC1 Sales and operating income margin
Intellectual property rights protection - Percentage of employees who have undergone e-learning training relating to intellectual property rights protection
Environment Energy G4-EN3 Rate of improvement in per-unit energy consumption
Emissions into the atmosphere G4-EN15 Greenhouse gas emissions
(Scope 1 and Scope 2)
Discharged water and waste G4-EN23 Waste recycling rate
Hazardous substances - Percentage of suppliers covered by hazardous substance surveys
Products and services G4-EN27 Percentage of products meeting own green products criteria
Compliance G4-EN29 Number of environmental non-compliance
Supplier environmental assessment G4-EN32 Percentage of new suppliers that were screened using environmental impact criteria
Society Conflict minerals - Continuing efforts to use materials where the risk that said minerals have been produced using conflict minerals is low, by asking business partners to ensure transparency in regard to the sources of materials and components, etc., and by working together with industry organizations and business partners to investigate information relating to conflict minerals (i.e. mineral processing firm information).
Employment G4-LA3 Percentage of employees returning to work after taking childbirth and/or childcare leave
Occupational health and safety G4-LA6 Occupational accident rate in Japan
Training and education G4-LA9 Average number of hours of training per employee per year
Diversity and equal opportunity G4-LA12 Female employees as percentage of total workforce
Supplier labor practices assessment G4-LA14 Percentage of new suppliers that were screened using labor practices criteria
Non-discrimination G4-HR3 Number of complaints submitted to the helpline that are properly resolved
Supplier human rights assessment G4-HR10 Percentage of new suppliers that were screened using human rights criteria
Anti-corruption G4-SO5 Number of confirmed incidents of improper behavior
Compliance with anti-monopoly legislation G4-SO7 Number of incidents relating to relevant legislation
Compliance G4-SO8 Number of non-compliance instances relating to social issues
Supplier assessment for impact on society G4-SO9 Percentage of new suppliers that were screened using criteria for impacts on society
Customer health and safety G4-PR2 Number of non-compliance of own safety standards
Customer privacy G4-PR8 Number of complaints relating to information security
Compliance G4-PR9 Number of non-compliance relating to products/services

A Message from Advantest’s Director of CSR

Advantest’s stakeholders want the company to achieve an appropriate balance between contributing to society-wide sustainability and generating profits to enhance corporate value. The common starting point for our business activities and our CSR activities is the long-term vision of using our test and measurement technologies to help address many of the problems that affect contemporary society. Working from this starting point, we strive to fulfill our social responsibility in every aspect of our corporate activities, including our supply chain.

In fiscal 2015, we established a Materiality Identification Project Team with members that include CSR Working Group members, representatives of relevant departments, and executive directors. After working to determine society’s precise expectations of the Advantest Group, and discussing which items the Group should focus on, the team drew up a list of 24 specified key materiality aspects. This initiative has become the starting point for a new approach to business development that takes into account both the complexity of our supply chain and Advantest’s responsibilities with respect to it. The initiative has also conducted a follow-up survey to verify whether or not any “3TG” (tungsten, titanium, tin and gold) conflict minerals* are used as materials in the manufacturing of semiconductors used in computers, smartphones and other precision instruments and electrical devices.

In fiscal 2016, Advantest set targets for fiscal 2018 with regard to the specified key materiality items, and also formulated key performance indicators (KPIs) to serve as benchmarks for related activities; these have provided the basis for substantive, concrete measures. To achieve our goals, we are currently implementing CSR activities at business locations throughout the world, coordinated from bases in 18 countries in North America, Europe, Asia, and elsewhere.

*Conflict minerals: This refers to the “3TG” (tin, tantalum, tungsten, and gold) minerals as well as the ores from which they are derived, i.e. cassiterite, columbite-tantalite (coltan), wolframite, and gold. The Democratic Republic of the Congo (which has seen almost unceasing conflict in recent years) and neighboring countries are important locations for the mining of these minerals; the mining and trading of conflict minerals has come to be seen as playing a significant role in providing funding for armed groups and leading to human rights violations, labor rights violations, etc.

Tsukui Koichi (Director and Managing Executive Officer)