Materiality

Chiyoda Group was founded in 1948 as a pioneer of engineering company that solves social issues using high level of technologies with the company slogan 'serving the society with technologies'.
Since then we have been moving forward together with the society with the mission 'Grow as a fully integrated engineering company aiming for harmony between energy and the environment while contributing to a healthy, prosperous and sustainable society through our profound engineering expertise and systematically developed technology' by capturing demands of international community precisely and by fully utilizing trained skills.
'Paris Agreement' adopted in UN in 2015 reached international community's consensus, aiming for decarbonized society to promote climate change and all companies are strongly required to promote these global issues through business with the universal goal 'Sustainable Development Goals (SDGs)'.

Under these circumstances, besides CSR basic policy which is the foundation in our business operation, we redefined social issues that need to be promoted in medium to long term as materiality to increase the company's value. Chiyoda Group will further strengthen its efforts to realize sustainable society through our business activities using materiality as an indicator.

Materiality

Materiality		Key Themes	Initiatives
E	Society with Reduced Environmental Impact	Mitigate climate change by reducing GHG emissions Stable supply of clean energy Establish a circular value chain	Lead the decarbonization of LNG and contribute to energy security Contribute to carbon a neutral society through CCUS and hydrogen technology Contribute to the stable supply of renewable energy through battery energy storage, renewable energy facilities and VPP
S	Prosperous and Healthy Life-style	Contribute to the healthy lives of people by providing life science solutions Build sustainable industrial fundamentals Respect human rights	Contribute to advanced medicines through continuous synthesis technology and business investment Realize the transformation of plant O&M Contribute to the stable supply of materials that are key to realizing a decarbonized society Conduct business with consideration for human rights
	Organizational Culture that enables Diverse Human Resources to Challenge Value Creation	Develop organization for diversified values Implement a general change of organizational managers leading organizational reform and their education Promote diversity and inclusion Further enhance Health Management Robust labor-management relations	Develop and expand key human resources who accept the challenge of business transformation by further expanding our company's strengths with a adaptive mindset Build a sustainable cycle in which human resources and organizations work as 'One Team' to achieve 'Well-Being' and accept the challenge of creating value to embody our new purpose
	Human Resources addressing Social Issues Autonomously	Expand key human resources Establish specialized education combining off-the-job training and on-the-job training for business execution abilities Maximize performance of seniors Develop digital human resources
G	Equitable and Fair Corporate Management	Equitable, fair and respectful behavior Promote fair trade and appropriate disclosure of information Stringent and comprehensive supply chain risk management Stringent and comprehensive compliance and risk management	Prevent damage to corporate value due to compliance issues by engaging in equitable, fair and respectful behavior

Materiality analysis

Step1. Business Areas and Identifying Issues

When identifying materiality, interdepartmental working group was formed inside the company. Issues that our company must promote were figured out comprehensively by comparing our business areas, GRI standard and SDGs as well as by referring the opinion from external experts.

Step2. Identifying Materiality

Materiality is defined as theme of high importance by following the below 3 steps from the issues figured out in Step1.

Analyze both perspectives of social and business impact
Pick up the themes that the stakeholders who evaluate our company bring up in common as themes of high importance
Give assessment on opportunities and risks for our business on each key theme

Identifying Process of Materiality

1. Analyze social and business impact

2. Pick up Themes of High Importance

Picked up themes of high importance（Grouping）

1

Inhibition of climate change by reduction of GHG emissions
Stable supply of clean energy
Building circular value chain

2

Contribution to people's healthy life by providing life science solutions
Building sustainable industrial base
Respect human rights of all people

3

Promoting diversity and inclusion
Reform of organization culture
Further fulfillment of healthy management base
Sound management and labour relations

4

Establishing specialized/basic education to support the ability to carry out work
Powerful development of professional human resources who play key role in our business
Development of digital human resources

5

Fair and square behavior with dignity
Promoting fair trade and appropriate information disclosure
Thorough risk management of supply chain
Thorough Compliance and Risk Management

3. Opportunities・Risks Evaluation on Each Main Theme

Step3. Decision of Materiality

After identifying important issues in Step 2 discussion and careful examination will follow in the Sustainability Committee. Upon approval from Board of Directors' Meeting, they will be defined as materiality.

Sustainability