- Yokogawa Sustainability Report
Utilizing our ability to measure and connect, we fulfill our
responsibilities for the future of our planet.
(Yokogawa's Purpose established in 2021)
Aspiring to address social issues by leveraging Yokogawa's ability to measure and connect,
we adopted Yokogawa's Purpose. No single organization or system alone can solve the serious issues the world faces, such as climate change, plastic and waste, and COVID-19.
We need to look for ways to address issues by assessing situations, sharing various information, and organically connecting organizations and systems.
It is also important to respect the human rights of all people and build a world without discrimination as our basic premise. Yokogawa will continue to seek reform together with stakeholders around the world, striving to make the world a better place for future generations.
Statement on Yokogawa's Aspiration for Sustainability
Yokogawa will work to achieve net-zero emissions, ensure the well-being of all, and make a transition to a circular economy by 2050, thus making the world a better place for future generations.
We will undergo the necessary transformation to achieve these goals by 1. becoming more adaptable and resilient, 2. evolving our businesses to engage in regenerative value creation, and 3. promoting co-innovation with our stakeholders.
(Formulated(2017in年2017)制定)
The Yokogawa Philosophy
As a company, our goal is to contribute to the realization of a sustainable society through broad- ranging activities in the areas of measurement, control, and information
Individually, we aim to combine good citizenship with the courage to innovate..
2023 Yokogawa Sustainability Report 1
Introduction | Our Goals | Our Stories | Social | Environment |
Governance | Information |
Contents
01 Introduction
03 | Message from the President | |
05 | Yokogawa Business Overview | |
05 | Business | |
06 | Network | |
07 | Technology | |
09 | 08 | Extensive Achievements and Transformation |
Stakeholder Engagement |
11 Our Goals
- Sustainability Goals "Three goals"
- Six Contribution Areas
- Setting Contribution Areas Based on Materiality Analysis
- Indicators for Six Contribution Areas (Social Impact Indicators)
- Indicators for Six Contribution Areas (Business Activity Indicators)
17 Our Stories
18 Our Stories of Growing our Businesses and Contributing to Society
20 | 1. Achieving Carbon Neutrality |
22 | 2. Improving Efficiency in Society & Industry |
25 | 3. Optimizing Plant Lifecycle & Protecting |
Environment | |
27 | 4. Improving Health & Safety |
32 | 5. Creating a Resource-Recycling Ecosystem |
33 | 6. Creating Workplaces Where People Can |
34 | Fulfill Their Potential |
Climate Risks and Opportunities Response to TCFD | |
39 | Biodiversity-related Disclosure Response to TNFD |
41 Social
42 | Human Resource Management |
45 | Safe and Comfortable Work Environment |
50 | Respect for Human Rights |
52 | Community Engagement |
53 Environment
54 | Environmental Management |
56 | Environmental Practices |
57 | Greenhouse Gas (GHG) Emissions Reduction |
61 | Environmental Initiatives at Business Facilities |
63 Governance
- Sustainability Governance
- Risk Management
- Code of Conduct and Compliance
- Supply Chain Management
- Information Security
- Quality Assurance
79 Information
- Sustainability Data
- Third-partyVerification
- Company Profile / Editorial Policy
2023 Yokogawa Sustainability Report 2
Introduction | Our Goals | Our Stories | Social | Environment |
Message from the President
We are moving forward with our contributions and growth while refining Yokogawa's unique strengths
Understanding changes in our business environment to enhance our ESG management
Based on Yokogawa's Purpose, which reads, "Utilizing our ability to measure and connect, we fulfill our responsibilities for the future of our planet," we focus on the environment, society, and governance (ESG) in our management.
Environmental and social issues grow increasingly serious year by year, and we have witnessed a variety of events over the past year. At the COP27 international climate change conference, which was held in November 2022 in Egypt, the participants reaffirmed the importance of limiting the global temperature increase to no more than 1.5°C above pre-industrial levels (the 1.5°C goal). And the COP15 international biodiversity conference, which was held in Canada in December 2022, saw the adoption of the Kunming-Montreal Global Biodiversity Framework, which includes nature- positive goals. Amid the heated debate on measures to address environmental issues at international conferences such as these, it has become clear that any delay in their implementation will result
in an even more serious environmental crisis, as seen in developments such as the average global temperature for July 2023 being the highest on record for any month.
In light of such changes, at Yokogawa we are working to further enhance our ESG management. So far, we have defined "Three goals" for sustainability as our vision for society in the year 2050, and in the Accelerate Growth 2023 (AG2023) mid-term business plan that was formulated in fiscal year 2021, we employed a materiality analysis process to select six areas where we will contribute toward their achievement. In line with these six contribution areas, we perceive the task of resolving the social issues faced by our customers as business opportunities, and we will make contributions and achieve growth in each of our businesses. In last year's Yokogawa Sustainability Report, the article "Story of growing our businesses and contributing to society" summarized this process. This year, we have expanded on this and are presenting stories on all our focus areas. Also, we have worked for some time to strengthen governance, the foundation for our contributions and growth, focusing on the Board of Directors, which engages in vigorous discussions on various ESG issues. The Sustainability Committee, which was established in 2022 as an advisory body to the Management Board, has engaged in discussions on a broad range of topics, such as materiality analysis and the formulation of the above-mentioned "Story of growing our businesses and contributing to society." Committee meetings are chaired by myself and attended by all executive officers. This fiscal year, we are promoting ESG management with the intention to further integrate our contributions and business growth, and are pushing ahead with deeper discussions of matters such as Scope 3 GHG emissions reduction strategies and product resource recycling.
Governance
Information
President and CEO
2023 Yokogawa Sustainability Report 3
Introduction
Our Goals
Our Stories
Social
Environment
Governance
Information
Message from the President
Expanding business opportunities by contributing to sustainability
Over the past year, I have visited our customers in various regions and industries. With society facing ever more serious issues, I have gained a first-hand appreciation of the challenges that industries are taking on. In Europe, for example, the shift to a hydrogen economy is accelerating, amidst the energy transition trend.
Under AG2023, we have established three industry business subsegments under our main control business that match up with our customers' industry sectors: Energy & Sustainability, Materials, and Life. This structure enables us to provide our products and solutions to customers in diverse industries and contribute to a wider range of areas. With our customers facing increasingly diverse and complex issues, I sense that they are responding positively to the solutions we are providing that leverage Yokogawa's strengths, such as the ability to integrate information technology (IT) and operational technology (OT), based on our extensive project track record. For example, Yokogawa is in charge of optimizing operations as the main automation contractor for a green hydrogen project at the Port of Rotterdam in the Netherlands. Also, at a chemical plant in Japan, we have successfully field-tested an AI solution that autonomously controlled a distillation column that previously has been controlled manually. In addition to maintaining quality and reducing workload, the system reduced both steam consumption and CO2 emissions by 40%.
These are only a couple of our many initiatives. We will continue to work with our customers to zresolve the various issues arising from social and environmental changes.
The growth of our employees creates Yokogawa's future
I believe that Yokogawa's strength lies in its resilience and its capacity to transform itself to adapt to changing circumstances. At the same time, the business environment continues to change at an ever greater speed, and it is vital that we boldly step ahead and take on the challenge to transform. To achieve this, the growth of each employee is ever more important.
Yokogawa is a global company, with approximately 70% of our net sales generated overseas. Our organization brings together personnel with a wide range of experience, perspectives, and cultural backgrounds, and so initiatives for diversity, equity, and inclusion are extremely important to us. When diverse people are gathered together, it gives rise to something like a chemical reaction, generating new perspectives and methods that go beyond conventional ways of thinking and doing things. Along with this diversity in perspectives and methods, collaboration with other companies also fuels transformation. The cumulative results of this transformation will mold Yokogawa's future.
In addition to accelerating this transformation, we are promoting various initiatives to cultivate a corporate culture and organizational environment that encourages employees to make proposals and take on challenges. We will link together the growth of each of our employees to create Yokogawa's future.
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Three goals and six contribution areas
Six contribution | Priority issues | |
areas | ||
Achieving carbon | Reducing GHG emissions and enabling | |
the transition to affordable, reliable, and | ||
neutrality | sustainable forms of energy | |
Improving efficiency | Optimizing production, enabling autonomy, | |
and facilitating the efficient use of resources | ||
in society & industry | and energy through DX | |
Optimizing plant | Supporting both the long-term optimal | |
lifecycle & protecting | operation of plant assets and the reduction | |
environment | of their environmental footprint | |
Improving health & | Promoting life-related innovation and | |
safety | improving safety in plants and communities | |
Creating a resource- | Fostering the development of the | |
recycling ecosystem | bioeconomy and a circular economy | |
Creating workplaces | Establishing an equal opportunity | |
where people can | workplace where employees can be treated | |
fulfill their potential | with dignity and fulfill their potential |
2023 Yokogawa Sustainability Report 4
Introduction
Our Goals
Our Stories
Social
Environment
Governance
Information
Yokogawa Business Overview
Business
Yokogawa contributes to solving social issues, utilizing its ability to measure and connect.
We have divided the control business, our main business, into three industry subsegments: Energy & Sustainability, Materials, and Life. That allows us to provide products and solution services that can solve issues of customers in various industries and social issues.
Energy & Sustainability
The energy & sustainability business segment protects the environment by supporting the effective use
of energy and contributing to the realization of a sustainable society. Capitalizing on its expertise and strong customer relationships in the oil & gas, petrochemical, renewable energy, power, energy management, and energy storage fields, Yokogawa supports safe and optimal operations throughout the increasingly diversified energy supply chain, from production and supply through to use, disposal, and recycling.
Oil & gas
Petrochemical
Renewable energy
Power
Energy management
Energy storage
Areas for exploration
Materials
The materials business segment is helping to bring about a circular economy that offers comfort and convenience and is in harmony with the environment. For our customers in the specialty chemicals, biomass materials, pulp & paper, textiles, steel, non-ferrous metals, mining, mobility, and electrical/electronics fields, we provide solutions that improve productivity, reduce environmental impact, and save energy.
Specialty chemicals
Biomass materials
Pulp & paper
Textiles
Steel
Non-ferrous metals
Mining
Mobility
Electrical/electronics
Life
The life business segment provides solutions that support people's lives and protect health and safety. In addition to our activities in the pharmaceuticals and healthcare fields, we are engaged in businesses that ensure everyone has access to safe water and food. To improve productivity throughout the pharmaceutical and food value chains, we utilize the sensing and control technologies that Yokogawa has developed over the years to support innovations in product and production processes. In the water field, we aim to create new value by using the measurement technologies that have been acquired through our activities in such fields as genome analysis and scientific instrumentation.
Pharmaceuticals
Healthcare
Food
Water
Disaster prevention, space, and ocean
Measuring Instruments,
New Businesses and Other
The measuring instruments business helps our customers achieve technological innovation. We provide total solutions, including software and services to customers in three industrial fields (decarbonization, telecommunication, and well-being), making full use of high- precision measuring technology. Our new businesses include bio-related businesses.
Measuring instruments
Energy
Info-comm
Healthcare
New businesses and other amnimo Inc.
Bio-related businesses
2023 Yokogawa Sustainability Report 5
Introduction
Our Goals
Our Stories
Social
Environment
Governance
Information
Yokogawa Business Overview
Network
Yokogawa conducts business in more than 80 countries around the world. We are actively recruiting local human resources at each location and have built trust with customers and local communities over many years. Moreover, based on our corporate philosophy, we are engaged in businesses for the realization of a sustainable society as good citizens.
Employees by Region | Global Network Supporting Business Growth | |||
(At the end of FY2022) | ||||
6.�% | Netherlands | China | United States | |||||||||||
Yokogawa Europe B.V. | Yokogawa China Co., Ltd. | Yokogawa Corporation | ||||||||||||
��.� | 6.�% | of America | Service Network | |||||||||||
% | ��.8% | ■ Japan | Korea | |||||||||||
��,��� | Countries and | |||||||||||||
■ Asia and Oceania | Bahrain | Yokogawa Electric Korea Co., Ltd. | ||||||||||||
■ Europe and CIS | sites served | |||||||||||||
employees | ■ North and South America | Yokogawa Middle East & | 200+ | |||||||||||
��.� | % | ■ Middle East and Africa | Africa B.S.C. (c) | YokogawaJapan | Electric Corporation | Brazil | ||||||||
India | Singapore | Service sites | ||||||||||||
Yokogawa America do | 180+ | |||||||||||||
Yokogawa India Limited | Yokogawa Engineering Asia Pte. Ltd. | Sul Ltda. | ||||||||||||
2,500 | ||||||||||||||
Business sites | Subsidiaries and Affiliates | Manufacturing sites | Service engineers | |||||||||||
World Headquarters/ | countries | in Japan | outside Japan | countries | + | |||||||||
Regional Headquarters | (At the end of FY2022) | |||||||||||||
Manufacturing sites | 60 | 13* | 115 | 12 | ||||||||||
Includes branches and representative offices |
Activities with External Organizations
2009
Joined the Global Compact (United Nations)
This report covers initiatives for addressing the Compact's ten principles for four areas (human rights, labor, the environment, and anti-corruption).
2017
Joined the WBCSD*
- World Business Council for Sustainable Development
We are participating in projects for sustainable development.
2019
Expressed support of the TCFD* recommendations
* Task Force on Climate-related Financial Disclosures
We disclose information in accordance with TCFD recommendations.
For more details, see the Climate Risks and Opportunities (Response to TCFD) page.
2023 Yokogawa Sustainability Report 6
Introduction
Our Goals
Our Stories
Social
Environment
Governance
Information
Yokogawa Business Overview
Technology
Yokogawa contributes to solving social issues through its ability to measure and connect, which has developed throughout its history.
The Ability to Measure
The origins and starting point for Yokogawa's business lie in measurement. We seek value in the information that is derived by measuring things, grasping their current state, and making predictions.
Based on its ability to measure things, Yokogawa continues to provide value and support industries by offering oscilloscopes, power analyzers, optical test equipment, and other high-precision measuring instruments that are commonly referred to as "the mother tools of industry." For use in plant facilities, the company also provides a full range of field instruments, including flowmeters, pressure and temperature transmitters, and process analyzers.
The Ability to Connect
By connecting, Yokogawa not only combines valuable information, but also builds trusted relationships with customers from multiple industries and brings together companies and industries, giving resonance to the value that the company creates.
Yokogawa has cultivated its ability to connect by offering control systems and solutions that provide a solid footing for highly efficient and safe plant operations and the production of high-quality products. The company has broadened its offering of solutions to cover entire value chains and supply chains, and aims to expand its collaboration to take the creation of value even further.
Main Product and Solution Portfolio in the Control Business
At Yokogawa, we integrate our high-quality, highly reliable products and solutions, from the measurement and control technologies we have developed over many years to leading-edge technologies such as digital twins and AI, to solve the issues faced by our customers and contribute to resolving social issues.
Control | Energy & Sustainability Business | Materials Business | Life Business | ||||||||||||||
Business | We provid comprehensive | ||||||||||||||||
Technology) | Optimization at | Corporate | Supply chain & | products, services, and | |||||||||||||
Production | Feedstock | Energy carbon | solutions from on-site to the | ||||||||||||||
Corporate | strategy | logistics | management level | ||||||||||||||
management | and business | planning/ | management/ management/ | ERP management/ | |||||||||||||
(InformationIT | (SCM/ERP) | planning | optimization | optimization | optimization | optimization | Security | ||||||||||
Optimization of | Production | Advanced | Quality | Asset lifecycle | Safety | Operational | and Solutions | ||||||||||
factory operation | management/ | control and | management/ | risk | Industrial Cloud | ||||||||||||
(MES) | optimization | optimization | optimization | optimization | management | management | |||||||||||
Applications | |||||||||||||||||
Operation/ | |||||||||||||||||
Technology) | Monitoring/ | ||||||||||||||||
Control/Safety | Distributed control systems | Safety instrumented | Programmable logic | Collaborative | |||||||||||||
systems | controllers | information | |||||||||||||||
OT(Operational | server | ||||||||||||||||
Data generation | Field instruments | ||||||||||||||||
and acquisition | Process analyzers | IIoT | Data acquisition systems | Film/sheet | Distributed | ||||||||||||
Pressure and temperature transmitters | |||||||||||||||||
Wireless transmitters | Process gas | wireless | Paperless recorders, | thickness | temperature | ||||||||||||
Coriolis/magnetic/vortex/variable | chromatographss | sensors | data loggers | gauges | sensors | ||||||||||||
area flowmeters | |||||||||||||||||
Consulting | Design & | Lifecycle | |||||||||||||||
engineering/ | Installation | Training | services | ||||||||||||||
system | |||||||||||||||||
integration | |||||||||||||||||
2023 Yokogawa Sustainability Report 7
Introduction
Our Goals
Our Stories
Social
Environment
Governance
Information
Yokogawa Business Overview
Extensive Achievements and Transformation
Yokogawa has contributed to solving the issues faced by its customers and society around the world. We will build on our extensive achievements as we continue to transform ourselves to further expand our contribution and growth.
Building on Yokogawa's Extensive Delivery Track Record to Achieve Contribution and Growth
Since its foundation in 1915, Yokogawa has been contributing to social development by providing innovative products and solutions to industries based on its measurement, control, and information technologies. Over the six decades since we began our global business development rooted in local communities, Yokogawa has undertaken over 40,000 projects worldwide. By expanding into diverse industries, we boast a high market share not only in Japan, but also in the Middle East, China, ASEAN, and other resource-rich regions and emerging countries.
This extensive track record of deliveries testifies to the relationships of trust we have built with customers over many years. It is the foundation for Yokogawa's sustainable growth and contribution to solving social issues.
Europe and CIS | China | ||
9.9% | North America | ||
15.6% | |||
Japan | 9.5% | ||
Middle East | |||
India | 27.1% | ||
and Africa | Central and | ||
14.0% | 4.3% | ||
Southeast Asia | South America | ||
and Far East | 3.5% | ||
16.0% |
Fiscal year 2022 control business net sales by region
Transforming to Further Expand Contribution and Growth
Amid dramatic changes in the business environment, companies are expected to take an ever greater part in solving social issues. Yokogawa perceives these changes as a business opportunity. We will strengthen our ability to measure and connect, transforming into a company that continues to create value. Under our mid-term business plan, Accelerate Growth 2023 (AG2023), we are expanding our contribution and growth capabilities, including through the utilization of M&A and alliances, to widen the range of solutions we provide and strengthen industry responsiveness.
Main Topics in Fiscal Year 2022 (New Companies, M&A, and Alliances)
Expanding the range of solutions we provide
Established Yokogawa Digital Corporation to support DX in the manufacturing industry Invested in Waylay NV, a leading enterprise software company in Belgium
Acquired Votiva Singapore Pte. Ltd. to accelerate the growth of our ERP business in Southeast Asia
Acquired Fluence Analytics, Inc., a pioneer in the digitalization of polymerization reaction process measurement
Strengthening industry responsiveness
Acquired Dublix Technology ApS, a Danish company with efficiency improvement technology for waste and biomass power plants
Formed a capital and business alliance with Ideation3X Pte. Ltd., a company engaged in the recycling-based waste disposal business in India
Established SynCrest Inc., a joint venture with Otsuka Chemical Co., Ltd., and commenced a full-scale entry into the contracted research, development, and manufacturing business for middle-molecule pharmaceuticals
2023 Yokogawa Sustainability Report 8
Introduction
Our Goals
Our Stories
Social
Environment
Governance
Information
Stakeholder Engagement
Yokogawa is engaging with diverse stakeholders on a wide range of themes.
Customers
Objectives and themes
Solve social issues faced by customers Establish a support system
Key Initiatives
Shareholders and investors
Disclose information in a timely and appropriate manner
Have active and continuous dialogue Feedback to management
Employees | Suppliers | |||
Employees' engagement | Equal and fair business relationships | |||
Human resource development and | Promote supply chain sustainability | |||
capability development | ||||
Establish a comfortable working environment | ||||
Respect workers' rights |
Local communities and society
Contribute to the sustainable development of an international society Protect the Earth's environment Contribute to local communities
Provide consulting services to identify and solve issues
Develop and provide products and services utilizing cutting-edge technologies and DX
Establish a global service structure
Related information
Financial results briefings (quarterly) and general shareholders meetings (annually) IR events including business strategy briefings
Individual meetings with investors and analysts
Conduct engagement surveys to identify the status and respond to it Leverage Yokogawa University (an in- house institution) to promote learning Establishing the occupational health and safety committees Consultation between labor and management
Implement sustainable procurement based on self-assessment questionnaires (SAQ)
Promote green procurement with less environmental burdens
Participate in international projects to help emerging and developing countries develop further
Reduce greenhouse gas and preserve water resources
Cooperate with NGOs and NPOs Engage in volunteer activities in local communities
Network (P.06) Our Stories (P.17)
"Investor Relations" on our website https://www.yokogawa.com/about/ir/
Improvement of Employee Engagement (P.42)
Human Resources Development (P.44) Safe and Comfortable Work Environment (P.45)
Supply Chain Management (P.72)
Our Stories (P.17)
Community Engagement (P.52)
Greenhouse Gas (GHG) Emissions
Reduction (P.57)
Environmental Initiatives at Business Facilities (P.61)
External Ratings Yokogawa's ESG (environment, social, governance) management has received high external ratings.
Global
See Yokogawa's website for more details on external ratings:https://www.yokogawa.com/about/ir/
Japan
2023 Yokogawa Sustainability Report 9
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Yokogawa Electric Corporation published this content on 28 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 November 2023 09:41:13 UTC.