Sustainability Management

Society

Environment

Governance

External Evaluation

Performance Data / Independent

Guideline

Practitioner's Assurance

Comparison Table

SUSTAINABILITY MANAGEMENT

  • Basic Policy and StructureMateriality
    Status of Sustainability Targets

Sustainability Management

Basic Policy and Structure

Message from the CEO

The "Sysmex Way", the corporate philosophy of the Sysmex Group, defines our mission of "Shaping the advancement of healthcare." With its business centered on the field of in vitro diagnostics (IVD), which has been its focus since the Company's founding, Sysmex works to resolve global medical issues. The value Sysmex provides to society includes the extension of healthy lifespans, improvement in accessibility to healthcare, and advancement of medical care. We respond to the universal human desire to live long and healthy lives.

One key action under our mid-term management plan is to "formulate a vision and roll out measures to reinforce and implement sustainability management." Sysmex regularly reviews its materiality based on changes in the external environment, societal expectations and demands, and the progress of its strategies. In fiscal 2021, we revisited our KPIs alongside our new mid-term management plan, and set the reviewed KPIs as our new sustainability targets.

Society's expectations and demands are growing by the day with respect to the materiality items Sysmex has identified, such as the environment, diversity and inclusion (D&I), supply chain management, human rights, and governance. In light of these changes, Sysmex believes that sustainability management is of the utmost importance in order to build a sustainable structure while promoting efforts to address each issue from a long-term perspective and aligning the vector of our management strategy with these social trends.

In product development, it has become essential to create products that increase testing value while also being are environmentally friendly. For example, new products in the hematology field that we launched in 2021 shorten the time to

diagnosis, improve laboratory work efficiency, and lower environmental impact by reducing power consumption by 40%* compared to conventional products.

With D&I, it is important to have employees with diverse values and backgrounds who can share different ideas, and for each of them to demonstrate their abilities. For the Group as a whole, we will accelerate D&I initiatives. We will also promote human resource development and human resource strategies that leverage diversity from a D&I perspective. Gender is also an issue, especially in Japan, where the economic world has long been male dominated. We are working to create an environment and culture in which female employees can easily demonstrate their abilities, and are striving to increase the ratio of women among our employees and managers.

Corporate culture and human resources are of particular importance for enhancing corporate value. Sysmex positions human resources as the source of value creation. Accordingly, we are focused on revamping our HR system, attracting a diverse workforce, and cultivating the next generation of managers. Looking beyond strategy and system design, we also emphasize the accumulation of various types of experience and opportunities and an environment that allows employees to build diverse contacts, including with customers. Underpinning these efforts is the "Sysmex Way", the corporate philosophy of the Sysmex Group. Our ideal is for employees to think and draw up strategy in terms of the Sysmex Way, and to align our corporate culture with this philosophy. Sysmex's management is unwavering in its corporate stance toward this philosophy; we share the Sysmex Way when recruiting human resources and conduct awareness activities at each Group location. In corporate culture surveys of employees, the rate of penetration for the Sysmex Way has remained at around 70%

for the past few years. To improve this further, we will continue to promote dialogue with employees and increase engagement.

We strive toward the realization of a sustainable society and engage in initiatives to enhance corporate value, based on our mission as expressed in the Sysmex Way, of "Shaping the advancement of healthcare." We would like to ask our stakeholders for their continued support and understanding of our endeavors.

* Sample transportation system modules

Hisashi Ietsugu

Chairman and CEO

  • Corporate Philosophy and Core Behaviors
  • Sysmex Report (Sysmex's Value Creation)

Sysmex Sustainability Data Book 2022 3

Sustainability Management

Society

Environment

Governance

External Evaluation

Performance Data / Independent

Guideline

Practitioner's Assurance

Comparison Table

SUSTAINABILITY MANAGEMENT

  • Basic Policy and StructureMateriality
    Status of Sustainability Targets

Management Structure

Sysmex has established a specialized Sustainability Promotion Department for planning, drawing up proposals for, and promoting sustainability activities, as well as disseminating ESG-related information both inside and outside the company. The department's activities are conducted under the control and management of a senior managing director and member of the Managing Board.

We have also identified priority issues (materiality) with a view to realizing a sustainable society and achieving sustainable growth for the Group. In fiscal 2020, we reviewed materiality while working on our mid-term management plan (fiscal 2021 to 2023), taking account of changes in economic, environmental, and social issues. We also revisited our KPIs linked to materiality and set the reviewed KPIs as our new sustainability targets. Our departments roll out their execution plans and activities to achieve these sustainability targets. They also report their progress regularly at management meetings, including the Managing Board meetings. The targets are then reviewed, and new measures are considered in a PDCA cycle.

The UN Global Compact

Sysmex Corporation signed the United Nations Global Compact in February 2011 to proactively promote its CSR initiatives. When identifying priority issues (materiality) and promoting CSR activities, Sysmex refers to the Ten Principles of the Global Compact and the Sustainable Development Goals (SDGs) that the United Nations adopted in September 2015.

The UN Global Compact

Logo for the Sustainable Development Goals (SDGs)

  • The UN Global Compact's Ten Principles

Sysmex Sustainability Data Book 2022 4

Sustainability Management

Society

Environment

Governance

External Evaluation

Performance Data / Independent

Guideline

Practitioner's Assurance

Comparison Table

SUSTAINABILITY MANAGEMENT

Basic Policy and Structure

  • Materiality
    Status of Sustainability Targets

Sustainability Management

Materiality

Sysmex has identified priority issues (materiality) with a view to realizing a sustainable society and achieving sustainable growth for Sysmex.

Sysmex's materiality items are priorities we have identified by taking into account the needs and expectations elicited through stakeholder engagement and Sysmex's internal and external operating environments. We identified these priorities by making an overall assessment along two axes, the "degree of importance for Sysmex's stakeholders" from a medium- to long-term perspective, and from the perspective of risks and opportunities, the "degree of importance for Sysmex."

In addition, we review and verify these items when formulating mid-term management plans. These were previously verified in fiscal 2020. Some of the content was updated to reflect changes in the operating environment, such as growing demands from outside the Group.

To make progress toward our targets more visual and effective,

partners and employees to provide products and services to

Sysmex will continue to engage proactively in dialogues with

medical institutions and other customers in an effort to

stakeholders to co-create value in a sustainable manner.

resolve healthcare issues.

Materiality

SDGs Targets

Resolution of Medical Issues

Resolution of medical issues through

through Products and

innovation

Services

Improvement in accessibility to healthcare

Responsible Provision of

Pursuit of quality and trust

Products and Services

Society

Strengthening of supply chain management

Provision of a comfortable working environment

Realization of an Attractive

Promotion of diversity and inclusion

Workplace

Development of human resources

in the fiscal 2021 revision we set "sustainability targets" as specific KPIs in line with the mid-term management plan. We also developed action plans and activities for responsible divisions. Members of the Managing Board confirm progress toward sustainability targets, which is reported regularly by each department at meetings of the Managing Board and at quarterly management meetings. In addition, the entire

Environment Environmental Consideration

Promotion of health and occupational safety

Environmental consideration through product lifecycle

Reduction in environmental burden through activities at business offices

Corporate governance

Company works together on initiatives when discussing new measures.

As our business expands, our stakeholders have grown more diverse. Nevertheless, our fundamental management philosophy of instilling confidence among our stakeholders has remained unchanged. As a Group conducting business in the healthcare sector, Sysmex works alongside its business

Governance Strengthening of Governance Compliance

Risk management

  • The Process of Identifying Materiality

Sysmex Sustainability Data Book 2022 5

Sustainability Management

Society

Environment

Governance

External Evaluation

Performance Data / Independent

Guideline

Practitioner's Assurance

Comparison Table

Sustainability Management

Status of Sustainability Targets

Materiality

throughissuesmedicalofResolution servicesandproducts

Resolution of

medical issues

through

innovation

Improvement

in accessibility

to healthcare

ofprovisionResponsible servicesandproducts

Pursuit of

management

quality and

trust

Strengthening

of supply

chain

Realization

Provision of a

comfortable

of

working

environment

workplace attractive an

Promotion of

diversity and

inclusion

KPI

Target

Results

Progress and Future Initiatives

Fiscal 2023

Fiscal 2025

Fiscal 2017

Fiscal 2018

Fiscal 2019

Fiscal 2020

Fiscal 2021

(Eco-Vision)

Hematology market

Percentage of consolidated sales to market size of

52.7

53.8

54.7

55.6

55.7

instruments, reagents, and services in a single year in

share1 5

the field of hematology

Number of patents

Total number of patents, utility model rights and

2,709

2,987

3,143

3,485

3,680

Though the impact of the COVID-19 pandemic remains in some regions, our share of the hematology market slightly increased in

design rights obtained

fiscal 2021 compared to the previous fiscal year, as sales of hematology products grew due to the expansion of direct marketing

Number of new patents

Total number of patents, utility model rights and

301

346

306

287

298

and service areas. In the future, new flagship models will be sequentially introduced.

design rights applied for

In addition, the number of tests for breast cancer using the OSNA method increased because the number of surgeries has

returned to its previous level.

Number of cancer

Number of cancer genomes analyzed by the NCC

1,6 thousand

1,6 thousand

In conjunction with business activities, the numbers of patents held and patent applications have steadily increased.

genomes analyzed2

OncoPanel

Number of breast

Number of breast cancer tests using the OSNA

46 thousand

54 thousand

cancer tests using the

OSNA™ method

method

Sales in emerging and

Consolidated sales in emerging and developing

In fiscal 2021, sales grew by approximately 12% for several reasons, including favorable business in the direct marketing and service

¥122.0 billion

¥143.0 billion

areas in emerging countries such as India and the number of tests returning to its previous level in areas where the demand had

developing markets

markets

fallen due to the COVID-19 pandemic. We are also taking actions to improve the quality of healthcare in collaboration with

international institutions such as the WHO and JICA.

Number of recalls

Number of voluntary recalls/repairs for products sold

4

2

There were only two recalls in fiscal 2021, which was half the number as in the previous fiscal year. Of these recalls, none were Class

(instruments and reagents)

I; two were Class II (one for an instrument and one for a reagent). As in the previous fiscal year, no FDA warning letters were issued.

As well as constructing a framework to fully comply with regulations in each country around the world, defective products are

Number of FDA

prevented from entering the market by conducting regular quality audits, timely collection of information from the market through

Number of FDA warning letters issued to Sysmex

0

0

our global quality complaint processing system, and full investigations into the causes of defective products. We will maintain and

warning letters

improve the safety and quality of our products in the future.

CSR survey response

Percentage of raw material suppliers that responded to

90

81

84

85

89

90

rate

CSR surveys (primary suppliers in Japan and overseas)

The CSR survey response rate was 90% in fiscal 2021. This was a high rate, as in the previous fiscal year. The number of training

Number of training

Number of briefings, training, and other training

6

2

5

sessions for suppliers increased from two in the previous fiscal year to five. We held BCP training for business partners, assuming a

sessions for suppliers3

sessions for domestic suppliers (single year)

Nankai Trough megathrust earthquake, as well as explanatory meetings on sustainability, including SDGs and environmental

issues, and approximately 250 business partners in total participated in these activities.

Third-party certification

Percentage of primary raw material suppliers

86

88

We will continue to strengthen relationships between the Group and our business partners.

rate of suppliers3

(domestic) obtaining third-party certification for

manufacturing and product quality

75

72

66

65

The engagement score in fiscal 2021 decreased by 1 % compared to the previous fiscal year. This was mainly due to a decrease in

Engagement score

Corporate climate survey result

the scores in China and West Asia. The turnover rate increased by 0.6%. This is a result of activation of the human resource market,

(except EMEA4)

(except EMEA)

which had slumped due to the COVID-19 pandemic. However, our turnover rate is lower and the employee retention rate is

considered to be high compared to an average turnover rate of about 9% in the manufacturing industry.

Turnover ratio2

Turnover ratio of regular employees, excluding those

2.7

3.3

We will continue to promote establishment of a globally consistent job-based human resource management system, conversion to

a globally competitive remuneration system, securing and training talented personnel, creating a comfortable working

who have reached the mandatory retirement age

environment, and engaging in labor-management dialogues in the future.

The outcome for fiscal 2021 increased by 1.1% compared to the previous fiscal year. Several measures were taken, including setting

Percentage of days of

Percentage of days of annual paid leave taken per

61.3

62.4

recommended dates for paid leave, sharing the results of this with division managers, and proactively encouraging employees to

take paid holidays.

paid leave taken2

regular employee

In addition to activities to raise awareness amongst our employees, we aim to increase the rate at which annual paid leave is taken

due to improved productivity.

The outcome for fiscal 2021 increased by 23.3% compared to the previous fiscal year. The rate at which male employees take

Percentage of men

Percentage of male employees (including part-time

childcare leave largely increased due to several measures such as changes in the awareness of working patterns as a result of the

workers) taking childcare leave after their spouse

30.0

33.8

57.1

introduction of the "smart work" system, educational activities in the previous fiscal year (hosting a diversity roundtable discussion

taking childcare leave3

bears a child

and issuing a guidebook for male employees), and training of managers.

We will continue to take actions to improve the rate at which male employees take childcare leave in the future.

The outcome for fiscal 2021 increased by 1.1% compared to the previous fiscal year. The achievement rate increased particularly in

Female managers ratio

Ratio of women at director level or above

17.0

15.2

15.2

15.5

16.2

17.3

the Japan region due to the introduction of a job-based personnel system and "smart work" system.

We promote the establishment of a comfortable working environment and the use of diversity training to facilitate diverse

working patterns.

Percentage of

Percentage of employees with physical, intellectual

The outcome for fiscal 2021 was at the same level as in the previous fiscal year, and Sysmex Harmony has continued to achieve a

2.38

2.04

2.21

2.30

2.30

2.31

zero turnover rate.

employees with

or mental disabilities

We will continue to create tasks and a comfortable working environment to allow persons with physical, intellectual, or mental

disabilities2

disabilities to fulfill their potential in accordance with their individual abilities.

1 Some figures have been revised from previous reporting. 2 Target: Group companies in Japan 3 Target: Sysmex Corporation on a non-consolidated basis 4 EMEA: Europe, the Middle East, and Africa 5 Source: Clearstate and Sysmex's assumption

Sysmex Sustainability Data Book 2022 6

Sustainability Management

Society

Environment

Governance

External Evaluation

Performance Data / Independent

Guideline

Practitioner's Assurance

Comparison Table

Materiality

Development

of human

anofRealization workplaceattractive

resources

Promotion of

health and

occupational

safety

Environmental

consideration

through

product

lifecycle

Environmental

consideration

Reduction in

environmental

burden

through

activities at

business

offices

Corporate

ofStrengthening

governance

Compliance

governance

Risk

management

KPI

Target

Results

Progress and Future Initiatives

Fiscal 2023

Fiscal 2025

Fiscal 2017

Fiscal 2018

Fiscal 2019

Fiscal 2020

Fiscal 2021

(Eco-Vision)

Training time per

Average training time per employee for training

40.0 hours

24.5 hours

31.4 hours

The outcome for fiscal 2021 increased by 6.9 hours compared to the previous fiscal year. Expansion of mission leader training,

provided by HR and each division (including online

on-board training, and online training was carried out in Japan, and specialized education was enhanced in each division.

employee

training)

We will continue to expand and enhance our employee training in the future.

Total annual working

The outcome for fiscal 2021 increased by 15 hours compared to the previous fiscal year. We were not able to alleviate staff

Total annual hours worked per regular employee

1,950 hours

2,030 hours

2,045 hours

shortages in response to the COVID-19 pandemic while also taking actions for technological innovation and business restructuring.

hours2

In the future, we aim to reduce working hours by introducing a system to monitor a value-added labor productivity index, in

addition to promoting "smart work" system, managing working hours, and conducting employee training.

Lost-time injury

Number of employee death or injuries resulting from

0.58

0.78

0.91

The lost-time injury frequency rate increased by 0.13 points for fiscal 2021, and there were seven industrial accidents (six in the

frequency rate2

work-related accidents per million hours actually worked

previous fiscal year), including injuries in factories. As a measure to prevent industrial accidents, we held training sessions by

industrial physicians to prevent falls.

Number of days absent from work due to

Lost work day rate2

0.02

0.05

0.04

In order to reduce the lost-time injury frequency rate, we are enhancing risk forecast training and will continue to provide training

work-related injuries per 1,000 hours actually worked

sessions by external lecturers in the future.

Reduction of CO2

Percentage reduction of CO2 emissions per

Cut 20

Cut 15

Cut 12

Cut 10

Cut 2

Cut 8

Cut 22

emissions

CO2 emissions per instrument decreased by 14% in fiscal 2021 from the previous fiscal year. This reduction was mainly due to

instrument unit with FY2016 as the base year

(instruments)

increased sales of power-saving products and global improvement in CO2 emission factors.

Reduction of water

Percentage reduction of water consumption per

Cut 10

Cut 15

Cut 8

Cut 2

Cut 4

Cut 6

Cut 13

Going forward, we will continue to promote reductions in CO2 emissions and water consumption by developing and selling new

consumption

products requiring less electricity and water.

instrument unit with FY2016 as the base year

(instruments)

The outcome for fiscal 2021 increased by 24% from the previous fiscal year. This increase was mainly due to delays in instrument

Reduction of CO2

Percentage reduction of CO2 emissions per S-Corp

Cut 20

Cut 15

Cut 17

Up 1

Cut 17

Cut 25

Cut 1

production due to a shortage of semiconductors and an increase in the use of air transport in response to a fire at a contracted

distribution center.

emissions (shipping)

sales with FY2016 as the base year

We are reducing CO2 emissions associated with product transport by promoting modal shifts and a shift in reagent production

from Japan to local production sites.

Reduction of

Percentage reduction of total packaging material

Cut 4

Up 9

The outcome for fiscal 2021 increased by 13% from the previous fiscal year. This was due to an increase in product packaging

packaging and labeling

materials (paper packages) due to growing reagent sales.

weight with FY2019 as the base year

materials

We are promoting a reduction in packaging materials by downsizing boxes to best fit products and changing packing methods.

The Scope 1 and 2 emissions in fiscal 2021 increased by approximately 2% from the previous fiscal year, because CO2 emission

Reduction of CO2

Percentage reduction of CO2 emissions from business

factors worsened at our main business locations in Japan, and there was an increase in PCR tests after our CoviLab started

Cut 40

Cut 50

Cut 14

Cut 17

Cut 13

Cut 35

Cut 44

operation at the Research and Development Center. CO2 emissions per unit were reduced due to an increase in consolidated sales.

emissions (business

activities per consolidated sales with FY2016 as the

We continue to promote optimization of our operations and energy-saving measures. At the same time, we are strengthening our

activities)

base year

approach to achieving carbon neutrality by gradually switching the electricity consumed at our business locations to renewable

energy sources.

Reduction of water

Percentage reduction of water consumption from

The outcome for fiscal 2021 increased by approximately 3% from the previous fiscal year due to an increase in production. Water

Cut 5

Cut 15

Cut 8

Cut 7

Up 6

Cut 7

Cut 19

consumption per unit decreased by 12% due to an increase in consolidated sales.

consumption

business activities per consolidated sales with

(business activities)

FY2016 as the base year

We are taking actions to reduce water consumption by revising production methods and introducing equipment to optimize the

efficiency of water usage and using recycled water at each business site.

Recycling rate

Resources recycled per total waste generated

85 or higher

93 or higher

89

76

67

78

79

The recycling rate for fiscal 2021 increased by 1% from the previous fiscal year. The total volume of waste increased by

Percentage of reduction of total waste generated by

Reduction of total

Cut 10

Cut 8

Cut 15

approximately 11% due to an increase in PCR tests after starting operation of the CoviLab at our Research and Development

waste1

business activities per consolidated sales with

Center, while waste generated per unit decreased due to an increase in consolidated sales.

FY2019 as the base year

We are continuing to take measures to reduce waste and to increase recycling rates by utilizing recyclable materials and

consumables, implementing appropriate inventory management, and extending expiry dates for reagent products.

Ratio of product waste

Ratio of product waste caused by expiry and other

0.6

0.6

to sales

reasons to consolidated sales

Number of meetings

Number of meetings with institutional investors and

506

485

Amidst the ongoing COVID-19 pandemic, we continued to have many meetings with institutional investors and analysts from

with investors and

securities companies. As a result, the number of meetings in fiscal 2021 was at the same level as in the previous fiscal year. We will

analysts3

securities analysts

continue to proactively hold dialogues with them through online meeting and other methods.

Number of internal

Number of internal reports of incidents received

32

14

11

12

28

There were 14 unethical incidents in fiscal 2021, but none were significant violations. A total of 28 internal reports were received in

reports

Japan and from overseas. We conducted investigations regarding these reports and dealt with each of them appropriately.

Total number of incidents in which the violations of

Number of unethical

9

7

5

14

We conduct training and educational activities for our employees as a foundation to promote and ensure compliance, and provide

incidents

the law were found, and disciplinary actions were

continuous training to employees to act in accordance with the Global Compliance Code.

taken for the violation of the Global Compliance Code

Number of

Number of participants in information security

In fiscal 2021, we held e-learning on cyber security in multiple languages for all our Group employees, as well as temporary

information security

2,720

3,601

employees and independent contractors.

training (gross)

trainees2

We provide regular training for employees to strengthen the information security management structure throughout the Group.

Participation rate in

Percentage of participants in training using safety

98.7

98.7

In fiscal 2021, disaster drills and e-learning were conducted.

confirmation tool assuming a disaster, etc. (including

We continue to enhance our response to risks in business continuity by conducting regular exercises and training, introducing a

disaster drills2

employees on long-term leave)

system to confirm employees' safety, and setting out rules and manuals to respond to disasters.

Sysmex Sustainability Data Book 2022 7

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Sysmex Corporation published this content on 26 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 October 2022 08:03:05 UTC.