Our Approach to Materiality
In 2016, we formulated key issues (materiality) that we must tackle by identifying the impacts that our company's operations have on society and understanding issues that society expects us to help solve. In addition, we set specific indicators (KPIs) and objectives to achieve by 2018 to promote our activities, and have been disclosing information proactively to our stakeholders and communicating with them in a responsible manner.
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 based on global social issues, issues related to the environment, economy and society, 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 the information obtained from questionnaire surveys with 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.
* Materiality items were identified in reference to the Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines.
Currently, the GRI Sustainability Reporting Standards is used to identify materiality aspects.
* EICC® : Electronic Industry Citizenship Coalition or Electronic Industry Code of Conduct
It was renamed to Responsible Business Alliance (RBA) in October 2017.
* 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. The identified materiality items were 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 what key performance indicators (KPIs) were needed and set one or two indicators per materiality aspect.
Identified Materiality Aspects and Corresponding KPIs Aspects
|Category||Identified materiality||KPI||Measures implemented||Items related to SDGs|
|Economy||Economic performance||Net sales, operating profit margin, ROE & EPS||Economic Impact|
|Environment||Energy||Rate of improvement in per-unit energy consumption||Mitigation of Climate Change (Global Warming Prevention)|
|Emissions into the atmosphere||Greenhouse gas emissions (Scope 1 and Scope 2)||Mitigation of Climate Change (Global Warming Prevention)|
|Discharged water and waste||Waste recycling rate||Recycling Resources|
|Hazardous substances||Percentage of suppliers requested to do hazardous substance surveys||Initiatives with Business Partners|
|Products and services||Percentage of products meeting the company's own green products criteria||Green Products|
|Compliance||Environmental compliance violations||Environmental Communication / Environmental Contribution Activities|
|Supplier environmental assessment||Percentage of new suppliers that were screened using environmental impact criteria||Procurement Practices|
|Society||Conflict minerals||Continuing efforts to use materials with a lower risk by asking business partners to ensure transparency with 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).||Procurement Practices|
|Employment||Re-employment rate following maternity and parental leave||Employment and Diversity|
|Occupational health and safety||Occupational accident rate in Japan||Occupational Health and Safety|
|Training and education||Average number of hours of training per employee per year||Human Resources Development, Fair Evaluation and Treatment|
|Diversity and equal opportunity||Ratio of female employees||Employment and Diversity|
|Supplier labor practices assessment||Percentage of new suppliers that were screened using labor practices criteria.||Procurement Practices|
|Non-discrimination||Number of complaints submitted to the helpline that are properly resolved||Compliance|
|Supplier human rights assessment||Percentage of new suppliers that were screened using human rights criteria||Procurement Practices|
|Anti-corruption||Number of confirmed incidents of improper behavior||Compliance|
|Compliance with anti-monopoly legislation||Number of incidents relating to relevant legislation||Compliance|
|Compliance||Number of non-compliance instances relating to social issues||Compliance|
|Supplier assessment for impact on society||Percentage of new suppliers that were screened using criteria for impacts on society||Procurement Practices|
|Customer health and safety||Number of non-compliance of own safety standards||Supporting Product Safety and Quality|
|Customer privacy||Number of complaints relating to information security||Risk Management|
|Intellectual Property Protection||Percentage of employees who have undergone e-learning training relating to intellectual property protection||Intellectual Property Protection|
|Compliance||Number of non-compliance relating to products/services||Supporting Product Safety and Quality|