Management for Sustainability

Our Basic Stance

Sumitomo Chemical’s Heritage - The Sumitomo Spirit

Carrying on the Sumitomo Spirit, which goes back to the 17th century, Sumitomo Chemical was founded to manufacture fertilizer from copper smelting emissions, helping to simultaneously overcome an environmental problem and increase crop yields.
In 1915, the Company opened for business as Sumitomo Fertilizer Works. Part of the Sumitomo Spirit is the concept of harmony between the individual, the nation, and society, meaning that our business must benefit society, not just our interests. This principle
is the heritage of Sumitomo Chemical’s founding. By honoring and carrying on this heritage, the Company has developed diverse businesses and helped enrich lives through constant technological innovation.

What Sumitomo Chemical Strives to Be

Based on the Sumitomo Spirit, Sumitomo Chemical has made creating new value by building on innovation to contribute to society through its business activities part of its Business Philosophy. Furthermore, based on the Business Philosophy, in 2004 we established the Basic CSR Policy. Under this policy, Sumitomo Chemical strives to not only pursue economic opportunities, but to contribute to solving the problems facing society and the environment, enrich people’s lives, and achieve the sustainable growth of the Sumitomo Chemical Group while contributing to the creation of a sustainable society. In 2016, this basic policy was amended to become the Group’s Basic CSR Policy.

Initiatives through the Sumitomo Chemical Group’s Businesses

The Sumitomo Chemical Group boasts the capability to develop innovative solutions by leveraging its technological expertise in diverse areas based on technologies developed through its many years of broad-ranging R&D (see “Six Core Technologies” on page 6 of Annual Report 2018); the capability to reach global markets; and loyal employees. These three core competencies are strengths of the Group.
The Sumitomo Chemical Group has designated environment and energy, ICT, and life sciences as business sectors to focus on, sectors where it can use the above strengths to the fullest. While working to solve problems that society faces in the areas of the environment, food, resources, and energy, we will provide solutions that help improve quality of life, including health promotion and enabling comfortable living, and build an affluent and comfortable society.

Our Approach to Sustainability

  • What Sumitomo Chemical Strives to Be

  • Initiatives through the Sumitomo Chemical Group’s Business

Priorities and Performance of the Sumitomo Chemical Group

Leveraging the strengths developed based on its Business Philosophy, Sumitomo Chemical strives to provide solutions that address the challenges it has taken on, thereby achieving the ongoing growth of the Group and contributing to the realization of a sustainable society.

Challenges & Business Opportunities

Working to Solve Issues Facing Society and Build an Affluent and Comfortable Society

Sumitomo Chemical is putting its full strength into solving issues facing society, such as environmental and food supply problems, and improving quality of life. In particular, to address urgent environmental problems, we have set common Group goals for environmental activities in such areas as climate change action and the use of valuable water resources and are working to reduce our environmental footprint. Furthermore, to fulfill its social responsibilities as a company in the chemical industry, Sumitomo Chemical strives to establish and maintain safe and stable operations; secure safety, the environment, and health with respect to the Sumitomo Chemical Group’s products; and maintain and improve the quality of those products.

Sumitomo Chemical’s Strength (Core Competence)

Capabilities to Develop Innovative Solutions by Leveraging Its Technological Expertise in Diverse Areas

Through its many years of broad-ranging R&D, Sumitomo Chemical has established six core technologies. We have designated environment and energy, ICT, and life sciences as three focus areas where we can make maximum use of these core technologies and are working to bring to market products and technologies under development.

Capabilities to Reach Global Markets

Aiming to become truly global, the Sumitomo Chemical Group has expanded its businesses around the world. Today, more than 60% of the Group’s total sales are outside Japan. Going forward, the Sumitomo Chemical Group will continue to actively develop businesses in which it has competitive strength in markets around the world to achieve sustained growth.

Loyal Employees

The strong loyalty that all employees bring to their daily work is one of the great strengths of the Sumitomo Chemical Group. We consider it essential to provide all employees with motivating workplaces where they can fully demonstrate their skills and abilities in a variety of situations. As a part of that effort, the Group is focusing on the active advancement of women and promoting priority measures aimed at creating an environment in which as many women as possible can excel.

Working with Society

Participation in Initiatives

Sumitomo Chemical is working to address a wide range of issues confronting society, including poverty, climate change, educational disparity, and gender inequality. We believe that in doing so, it is important to not only comply with international standards, but to collaborate with various international organizations, NGOs, and other companies, and we are actively participating in initiatives with such entities.

Dialogue with Stakeholders

The Sumitomo Chemical Group’s Basic CSR Policy dictates that the Sumitomo Chemical Group shall take into consideration the interests of all stakeholders when pursuing and promoting CSR activities. To ensure that we maintain appropriate accountability to all stakeholders, we will continue working to deepen mutual understanding with stakeholders as well as to live up to the trust of society through a variety of efforts, including not only our business activities but also initiatives that contribute to society and regional dialogues.

Priorities and Performance of the Sumitomo Chemical Group

Challenges & Business Opportunities

[J-GAAP] SSS* - designated Product Net Sales
[IFRS]SSS* - designated Product Sales Revenue

  • [J-GAAP] SSS<sup>*</sup> - designated Product Net Sales /  [IFRS]SSS<sup>*</sup> - designated Product Sales Revenue

Fiscal 2017 SSS sales revenue came to ¥335.7 billion, a rise of 6% year on year, mainly attributable to increased sales of existing products. SSS-designated products accounted for 15.3% of all sales revenue.

  • Sumika Sustainable Solutions

Carbon Intensity Index in Japan* /
Carbon Intensity Index outside Japan*

  • Carbon Intensity Index in Japan<sup>*</sup> / SSS*-designated Product Sales Revenue Carbon Intensity Index outside Japan<sup>*</sup>

The reason for the deterioration in the intensity index of CO2 emissions outside Japan in fiscal 2017 is due to factors such as new and expanded plant facilities. Sumitomo Chemical is working to improve this index, both inside and outside Japan, putting greater focus on saving energy.

  • Index reflects the total production plants of Sumitomo Chemical and its major Group companies that share CO2 emission intensity index reduction goals.

Water Usage in Japan*1, 3 /
Water Usage outside Japan*2, 3

  • Water Usage in Japan<sup>*1</sup>, 3 / Water Usage outside Japan<sup>*</sup>2, 3

Water usage in Japan increased 4.3% year on year in fiscal 2017, while water usage outside Japan increased 1.4%. We will continue working to reduce water usage.

  1. Total for Sumitomo Chemical and its major Group companies in Japan (for production plants)
  2. Total for major overseas Group companies (for production plants)
  3. Water usage includes seawater

Lost-workday Incident Rate*

  • Lost-workday Incident Rate<sup>*</sup>

The frequency rate of lost-workday incidents for fiscal 2017 was 0.26, failing to meet the goal of less than 0.1. To achieve this goal, Sumitomo Chemical is working to ensure thorough compliance with basic safety rules and implementing policies to prevent recurrence.

  • Indicates the frequency of industrial incidents as the number of deaths and injuries per one million hours of total work time.

Utilizing Sumitomo Chemical’s Strengths (Core Competencies)

Research and Development Expenses

  • Research and Development Expenses

Fiscal 2017 research and development expenses came to ¥165.3 billion, up 4.7% year on year. Around 90% of research and development expenditure is earmarked for the specialty chemicals field, chiefly in the life sciences sector.

Number of Female Managers /
Percentage of Female Managers among Managers (Non-consolidated)

  • Number of Female Managers / Percentage of Female Managers among Managers (Non-consolidated)

In order to promote the advancement of female employees, Sumitomo Chemical is aiming for women to account for at least 10% of positions equivalent to manager or above by 2020.

  • All numbers as of April 1 of that year

Number of People Taking Childcare Leave /
Number of Men Taking Childcare Leave (Non-consolidated)

  • Number of People Taking Childcare Leave / Number of Men Taking Childcare Leave (Non-consolidated)

Sumitomo Chemical is encouraging male employees who have had children to take childcare leave, with a goal of achieving a ratio of male employees taking childcare leave of at least 50%* by 2020 (the ratio for fiscal 2017 was 18.7%).

  • The number of people who have taken leave divided by the number of male employees who have had children in the relevant period (one year).

Promoting the SDGs:
Posts on our Sustainable Tree

  • Promoting the SDGs: Posts on our Sustainable Tree

The Sustainable Tree is a project in which posts about contributions to achieving the SDGs are made on a dedicated website. The Sustainable Tree is a global initiative, and we aim to have all Group companies participate.