Material Issues and KPIs

Committed to Sustainability Initiatives in Development, Design, Production, and Sales

As part of strengthening the sustainability management of the THK Group, an interdepartmental project to review material issues in light of the most recent state of society and changes to THK’s internal environment was launched in 2021. Specifically, project members deliberated together about the social issues that surround the THK Group, evaluating and examining these issues based on two axes: impact on business (horizontal axis) and societal demands and expectations (vertical axis). The result was graphed into a matrix, and 13 topics under four themes received final approval by the Board of Directors.

Defining Material Issues

Matrix

Themes and Topics Related to Material Issues

Metrics and Targets

Five working groups were established for the defined themes to pursue concrete initiatives for the material issues. After several rounds of deliberation among these working groups, the official metrics and targets were decided at a Sustainability Committee meeting held in October 2023. The entire THK Group will pursue activities aimed at the achievement of these metrics and targets.

Organization Structure

Theme	Topic	Head department	Metric and target	Scope	Target year	2024 results
Creating an affluent society and solving social issues through innovation	Solving social issues through innovation	Engineering Division	Develop and provide new products and services (including DX and other solutions) for aerospace, automotive, logistics, medical, and other consumer fields	THK Japan, Group companies in Japan, Group companies outside of Japan	2026	Developed new solutions and engaged in activities to expand sales Developed and proposed next-generation automotive components that are compact, low-cost, and suited to extreme environments Engaged in activities to expand sales of transfer robots to logistics centers Released a slide unit for aircraft galley container retrieval systems Released remote monitoring and control system for small sluice gates
	Quality and safety of products	Quality Assurance Department	Promote the appropriate operation of quality management systems, including ISO 9001 and IATF 16949, and the maintenance of certifications at relevant locations	THK Japan	2026	For ISO 9001: Upper management reviews and internal quality audits (at five plants) were performed and Japan Quality Assurance Organization (JQA) certification was renewed For IATF 16949: Regular IATF audit was performed (Automotive & Transportation Headquarters)
Decarbonization and realization of a recycling-oriented society	Climate change	Risk Management Department	Reduce Scope 1 and 2 CO₂ emissions to 50% of 2018 levels (2018 emissions: 106,514 tons, 2030 target: 53,257 tons)	THK Japan, Group companies in Japan	2030	Scope 1 and 2 CO₂ emissions: 80,406 tons Specific activities: Installed solar power generation systems, upgraded to more efficient production equipment, introduced insulation panels and insulation paint, and took countermeasures against air leaks
	Sustainable procurement	Risk Management Department	Distribute sustainable procurement guidelines to suppliers and conduct interviews and surveys through questionnaires	THK Japan	2026	Currently drafting sustainable procurement guidelines
	Recycling and conserving resources	Risk Management Department	Maintain zero emissions¹	THK Japan, Group companies in Japan (Production Division)	2026	Emissions rate less than 0.50% Specific activities: Continued waste sorting and reduction initiatives, recycled waste oil and other fluids, recycled steel material (cut remnants and shavings), and selected appropriate waste disposal contractors and managed them with regular audits
	Managing harmful substances	Risk Management Department	Distribute green procurement guidelines and obtain certificates of non-use	THK Japan, Group companies in Japan, Group companies outside of Japan	2026	Obtained certificates of non-use that conformed with our green procurement guidelines from 258 companies
Realization of a diverse and meaningful work environment	Respecting and considering human rights	Human Resources & General Affairs Department	Achieve a 100% completion rate for online human rights training	THK Japan	2026	Completion rate: 98.86% Specific activities: Issued company-wide notices, invited all members in leadership positions to mandatory trainings, contacted all locations and departments concerning training completion status, and sent reminders to those who had not yet completed the training
	Promoting diversity	Human Resources & General Affairs Department	Achieve a ratio where women constitute 20% or more of new hires in the sales, administrative, and engineering divisions	THK Japan	2026	Female employee ratio: 24.5% Specific activities: Continued to publish details about our system of shortened working hours for accommodating childcare and the number of individuals on childcare leave in job postings
	Occupational health and safety	Human Resources & General Affairs Department	Achieve and maintain a severity rate of 0.01 or less and an incident rate of 0.50 or less	THK Japan (Production Division)	2026	Severity rate: 0.00, Incident rate: 0.60² Specific activities: Established standards and implemented training for irregular work
	Talent development	Human Resources & General Affairs Department	Maintain a 95% or higher completion rate for basic data utilization training	THK Japan	2026	Completion rate: 97.67% Specific activities: Invited mid-career hires and new graduates to trainings, organized completion status information, and sent reminders to those who had not yet completed the training
Strengthening of a sustainable value creation platform	Corporate governance	Risk Management Department	Continue conducting annual evaluations of the effectiveness of the Board of Directors	THK Japan	2026	Annual evaluation performed by a third-party organization
	Compliance	Risk Management Department	Strengthen the diversity of internal reporting contacts and investigators	THK Japan	2026	Designated and trained female reporting contacts
	Risk management	Risk Management Department	Continue conducting annual risk assessments	THK Japan, Group companies in Japan, Group companies outside of Japan	2026	Annual assessment performed for 31 departments within THK Japan and 29 Group companies within and outside of Japan

1 Zero emissions: An emissions rate (volume of waste disposed/total discharged) of less than 0.50%.
2 Severity rate: The number of lost workdays multiplied by 1,000 and divided by the total number of hours worked.
Incident rate: The number of deaths or injuries multiplied by 1,000,000 and divided by the total number of hours worked.