Material Issues and Results

Process for Identifying Material Issues

JVCKENWOOD has revised the material issues based on the new Medium-Term Management Plan VISON 2023. We determined social issues strongly connected with its business on the basis of the Sustainable Development Goals (SDGs) and identified material issues while considering their relevance to VISION 2023.

List of Material Issues

The JVCKENWOOD Group has identified material issues for contributing to sustainable societies through business. We will be formulating KPIs from a mid- to long- term perspective, at the same time developing mechanisms that can be managed globally.

The JVCKENWOOD Group’s materiality matrix

The key management indicators for achieving Medium-Term Management Plan VISION 2023 (FY2021)

JVCKENWOOD has established the following KPIs linked to materiality toward the realization of the new medium-term management plan, VISION 2023 and the new environmental plan JK Green 2025.

See Products Products & Services that Help Resolve Social Issues for more details of business activities corresponding to each materiality.

No	Material issues	Key initiatives	KPIs and Targets（FY 2021）
1	Addressing climate change	Reducing greenhouse gas emissions (Scope 1+2)	Reduce greenhouse gas emissions (Scope 1+2): Reduce by 25.2% by FY 2025 compared to FY 2019
2	Addressing climate change	Reducing greenhouse gas emissions (Scope3)	Reduce greenhouse gas emissions (Scope3): Scope 3 Calculation and reduction for categories 1,4, and 11
3	Conserving water resources	Manage water use	Manage water consumption: 6% reduction from FY 2019 levels by FY 2025
4	Reducing environmental impact	Reduce wastewater and waste	Improve waste recycling rate: 90% or more recycling rate by FY 2025
5	Sustainable manufacturing	Identify and reduce the amount of plastic used	Reduce the amount of plastic used
6	Supply chain management	Prohibiting forced labor and child labor	Conduction human rights due diligence activities
7	Promoting active roles for employees	Promoting active roles for women	Ratio of women in executive positions: 5.8% or more
8	Initiatives for risk management	Product quality & safety	Number of recalls and response costs: Maintain 0 cases/0 yen
9		Corporate governance	Evaluation of the effectiveness of the Board of Directors: Conducted once a year Attendance rate at Board of Directors meetings: 100%
10		Information Security	IT security training attendance rate: 92% or higher Number of Cyber Security incidents: 2 or less
11	Preventing traffic accidents	Create value with mobility products & services	Expansion of market share in the navigation market Market development of dashcams equipped with new functions
12	Initiatives for disaster prevention/mitigation	Create value with disaster-prevention and disaster-mitigation products & services	Received one project order for disaster prevention solutions
13	Secure and safe community development	Create value with security products & services	Solve customer issues through image analysis and introduce products and systems that address the risk of COVID-19 infection
14	Ensuring secure and safe transport systems	Create value through telematics services	Introduce telematics services Market introduction of CABmee, a next-generation IoT vehicle dispatch system
15	Accelerating innovation	Accelerate innovation	Develop new genre products Introduce new edge AI cameras
16	Accelerating innovation	Manage/utilize intellectual property	The number of patent applications related to SDGs 3 (Good health and well-being), 9 (Industry, innovation and infrastructure), and 11 (Sustainable cities and communities) will account for at least 10% of all patent applications.
17	Stakeholder partnership	Collaborate with stakeholders	Succeed and construct a social implementation platform inside and outside the university to continuously create innovation through industry-government-academia collaboration

Main Indicators and Initiative Results Related to Material Issues (FY 2020)

In order to understand the status of initiatives for material issues so that further improvement can be made, JVCKENWOOD has formulated indicators (KPIs) associated with each of the material issues and has been implementing initiatives with targets set for fiscal 2020. The results of initiatives for each item is as follows.

Important issues for the realization of profitable growth and the solution of social issues (Smart service & Wellness)

JVCKENWOOD believes that making a contribution to a sustainable society provides good opportunities for a business and leads to profitable growth. Based on this belief, we have established indicators related to material issues and we are implementing initiatives for them in order to actively work to solve various social issues with our products.

No	Material issues	KPIs	Targets (FY 2020)	Results (FY 2020)	Status
1	Preventing traffic accidents	Market development of driving recorders with new functions including two-cameras	Actively provide the market with driving recorders equipped with new functions, such as two-cameras, from FY 2020 (9 models are scheduled to be introduced)	Two-cameras and 360℃ camera driving recorders have been provided actively the market and increased both in terms of volume and value (1.5 times in terms of volume and 1.4 times in terms of value compared to the previous year)	〇
2	Sustainable manufacturing	Launching new environmentally friendly products	Reduce 11.6 t of plastic	Reduce 11.9 t of plastic	〇
3	Secure and safe community development	Plan to launch new security products/services	Plan to introduce new security products and services: 20	21 products/services＋AI body temperature measurements solutions 178 cases	〇
4	Initiatives for disaster prevention/mitigation	Plan to launch new disaster-prevention and disaster-mitigation products/services	Plan to introduce new disaster prevention and mitigation products and services: 40	66 products/services	〇
5	Ensuring secure and safe transport systems	Plan to launch new IoT solution products/services	Plan to launch new telematics services: 5 projects (plus contribution to emerging countries through orders for ODA projects)	6 projects	〇

Important issues for the promotion of new business creation (Technological innovation)

JVCKENWOOD is working to create an environment in the company that will promote opportunities for innovation within the company.

No	Material issues	KPIs	Targets (FY 2020)	Results (FY 2020)	Status
1	Accelerate innovation	Innovation Act results (cumulative)	Collaboration in new business initiatives: 3	New business initiatives promoted and transferred to business units: 3	〇
2	Accelerate innovation	Conducting patent idea meetings	175 meetings/year	259 meetings/year	〇
3	Accelerate innovation	Conducting intellectual property skills training	20 sessions/year	10 sessions/year (Fewer times due to COVID-19)	△
4	Stakeholder partnership	Implementing social implementation projects through industry-government-academia collaboration	Develop plans to address the social issues caused by COVID-19 and apply for the government funding: 1 or more	23 cases	〇

Important issues for the strengthening of our business foundations (Resilience enhancement)

JVCKENWOOD is working to enhance its resilience with initiatives in fundamental domains (that support business) as a strategic base supported by robust, transparent, fair and inclusive mechanisms.

No	Material issues	KPIs	Targets (FY 2020)	Results (FY 2020)	Status
1	Diversity &inclusion	Percentage of female managers	5.0% or more	5.0%	〇
2	Addressing climate change	Greenhouse gas (Scope 1 and Scope 2) 　emissions / intensity (per unit of sales)	18,900t-CO₂ （it only covers emissions from domestic offices and production sites）	17,349 t-CO₂ （it only covers emissions from domestic offices and production sites）	〇
3	Addressing climate change）	Greenhouse gas (Scope 3) 　emissions / intensity (per unit of sales)	Improve accuracy of disclosure of FY 2019 results (review the calculation criteria, focusing on products with large emissions)	Improve accuracy of disclosure （650,548 t-CO₂e）	〇
4	Manage water use	Number of water quality-related legal violations*	Keep the number of violations to zero	Keep the number of violations to zero	〇
5	Reduce wastewater and waste	Amount of hazardous waste generated (management of 28 hazardous substances specified under the Water Pollution Prevention Act)	Less than 0.1443 t （emissions from domestic offices and overseas production sites）	Less than 0.6900 t （emissions from domestic offices and overseas production sites）	〇
6	Corporate governance	Evaluating the effectiveness of the Board of Directors	Evaluate annually	Evaluated	〇
7	Product quality & safety	Number of product recalls and cost incurred	Keep the number of recalls and associated cost for each fiscal year to zero	Keep the number of recalls and associated cost for each fiscal year to zero	〇
8	Information Security	Percentage of employees receiving IT security training	90.0%	92.7%	〇
9	Prohibiting Child Labor/ Forced Labor	Human rights policy formulation	Formulate the JVCKENWOOD Group's human rights policy	Formulate and disclose the "JVCKENWOOD Group Human Rights Policy“	〇

*Covering business locations in Japan and overseas

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