Materiality

Materiality Initiatives

About Materiality Initiatives

To ensure effective and steady implementation of our materiality initiatives, Nidec has set 15 action themes in the five materiality categories. And, for each theme, we have set KPIs, which we intend to achieve by FY2025. We incorporate the KPIs into the new medium-term strategic goal Vision 2025, and work on them to enhance the sustainability of our business. We may change the materiality issues, action themes and KPIs taking into consideration their validity according to the business environment in the future.
As a structure to check that each activity is being conducted steadily and effectively, a Sustainability Promotion Meeting is held periodically. In this meeting, held every other month in principle, its participants check the status of the execution of materiality-related business operations, and deliberate and resolve policies and important matters related to Nidec’s sustainability activities.

Materiality and theme to be addressed

KPIs for each themes to be addressed

Category	Materiality	Theme to be addressed	Sub-theme	KPI (FY2025)	Progress in FY2023
Environment	Contribute to environmental sustainability	Realize a carbon-free society	Contribute to decarbonization through products	Contributing through Automotive Products Reduce CO₂ emissions by introducing the EV traction motor system (E-Axle/BSG): Cumulative total from FY2020 to FY2025: 11,700,000 t-CO₂ Reduce CO₂ emissions by introducing electric power steering (EPS-PP/EPS) motors: Cumulative total from FY2020 to FY2025: 26,261,000 t-CO₂ Reduce CO₂ emissions by introducing electronic brake booster (EPS-PP/EPS) motors: Cumulative total from FY2020 to FY2025: 10,029,000 t-CO₂ Contributing through the small precision motors Reduce CO₂ emissions by introducing motors for compact EVs: 35,000 t-CO₂ per year Reduce CO₂ emissions by introducing motors for e-bikes: 32,000 t-CO₂ per year	In the Automotive Products business, we are developing the third generation of E-Axle models, which have technological advantages such as low cost, high profitability, functional integration, and high-speed rotation, and we plan to increase sales volume in FY2024. In the small precision motors business, we are developing and improving our production system for drive motors for e-bikes. We are preparing for the growth of the e-Bike market by starting up a new plant, and we aim to contribute to a decarbonized society with environmentally friendly next-generation models.
		Realize a carbon-free society	Reduce GHGs emissions attributable to business activities	By FY2025, increase the introduction ratio of renewable energy to 40% on a consolidated basis Annually disclose a climate change scenario in line with the Task Force on Climate Related Financial Disclosures (TCFD) recommendations	Aiming to increase the introduction ratio of renewable energy, we are promoting initiatives that focus on both energy conservation activities and the introduction of renewable energy at each business site. Regarding the TCFD Recommendations, we have completed scenario analysis of climate change impacts.
		Manage waste and hazardous waste	ー	Reduce the volume of waste generated in intensity per unit sales by at least 3% from the level of FY2022	We are promoting activities to save resources and reduce defective products by reviewing product design, and we aim to reduce the amount of waste and valuable resources generated in FY2023 by 4.7% compared to FY2022 on a per-unit sales basis. We also place importance on improving material yield, and we aim to achieve reductions by improving processing losses during manufacturing.
		Handle water risks	ー	Fully complete water risk assessments at all production sites	Using Aqueduct and the Water Risk Filter, we assessed the water risks at all production sites. We investigated the impact on business in five areas: flooding, water shortages, water quality, water supply fluctuations, and regulations/ reputation, and identified flooding and water shortages as important risks. We identified 12 sites with high risk: five in China, three in Thailand, two in Vietnam, and two in India, and confirmed that risk countermeasures were being taken at these sites.
Products	Provide products and services adapted to social change	Pursue product safety and quality	ー	Create a database for chemical substances contained in products to make it easier for the development department to determine the choice of materials, and shift to an environment-oriented development system Implement quality management reforms in the automotive-related business, and establish an overall quality control organization and system by FY2025 Conduct assessment of all newly developed products and all products during the manufacturing process to reduce product safety risks	The Small Platform Motor & Solutions Business Unit has already complied with the current regulations of advanced environmental countries. In preparation for future legal regulations and stricter social demands, we are working to reduce the amount of lead used and to utilize recycled resin materials. The Automotive Products Business Unit is focusing on improving quality, and is ensuring product quality and process quality through project deliverable audits. The global quality management division is holding meetings attended by the quality assurance departments of each NIDEC Group company, and is working to understand and share quality information.
		Respond to changes in the technological environment and the industrial structure	ー	Continuously launch new products that lead the Five Big Waves to resolve social issues Continue to pursue the high efficiency and miniaturization of motors that contribute to energy and resource saving	We strive to develop products and technologies that contribute to reducing the environmental impact on society and our customers, and we continue to promote the spread of these products. We promote research and development that contributes to energy and resource conservation, CO₂ emissions reduction, and improved recyclability through the development of more efficient motors and products that are smaller, lighter, thinner, and more compact.
		Protect and utilize intellectual properties	ー	Transform our IP portfolio to one that responds to social and business changes, including decarbonization and power and manpower saving, and use the new IP portfolio	Strengthened the construction and management of IP portfolios in line with product lifecycles, respect for the intellectual property rights of other companies, and market trend analysis. The proportion of the IP portfolio related to the SDGs, centered on the “Five Big Waves”, also remained at a high level of 56%. In 2024, the company was selected for the “Clarivate Top 100 Global Innovators 2024” for the second year in a row.
Human Resources	Retain and develop diverse talent	Maintain and foster globally competitive human resources	ー	Promote the discovery and development of global leaders ーStrengthen the development of management personnel, including global human resources Establish and make functional a global talent management system ーEstablish regional HR management ーClarify positions subject to head office management ーEstablish a global mobility policy	In terms of executive development, the Human Resources Development Committee discusses succession plans from a medium- to long-term perspective, identifies candidates for the next generation of management personnel, and carries out strategic training. In addition, the Nomination Committee appoints the new president. In terms of career development support, we provide career support for young employees through career plan sheets and training. We also provide leadership training and educational videos for managers, and strengthen support for the career development of their subordinates.
		Promote diversity	ー	Achieve the targets below related to women’s empowerment (non-consolidated) ーRatio of female directors: 20% or higher ーAll managerial positions held by women: 9% or higher ーRatio of female candidates for managerial positions: 15% or higher * Executive officer or higher position, including outside directors * Referring to female employees in positions immediately prior to managerial positions Recruit non-Japanese directors	We promote organizational development that aims to revitalize relationships between employees and improve the performance of the organization as a whole. We have introduced organizational performance surveys and workplace workshops, and are working to foster an organizational culture that promotes decision-making based on a vision while respecting diverse opinions.
		Promote occupational safety and health, and healthoriented business management	ー	Ensure a safe and comfortable work environment Reduce the number of serious accidents (those resulting in death or permanent disability) to zero Improve the Lost-time injury frequency rate Realizing health management as a unified NIDEC Group Receive certification as a White 500 Company (in the large enterprise category) under the 2025 Certified Health & Productivity Management Outstanding Organizations Recognition Program	Health seminars are held by occupational physicians to improve employees’ health literacy. Themes are set based on the results of annual health surveys. Employees with high health risks are given individual health guidance and encouraged to undergo detailed examinations, and efforts are made to improve and enhance the health of all employees.
		Respect human rights and follow proper labor practices	ー	Follow proper labor practices Manage working hours of employees, including those in managerial positions, from the perspective of occupational safety Reduce average overtime hours by improving productivity Respect human rights Clarify human rights policies for workers including those in the supply chain, and spread them among employees	We raise awareness of human rights in conjunction with International Human Rights Day and Human Rights Week, and implement e-learning and compliance training. We use SAQs at NIDEC Group sites to ensure that the NIDEC Group Human Rights Policies are well known and to promote individual corrective action. In order to prevent human rights risks in the supply chain, we are implementing SAQs with our suppliers and prioritizing risk assessment and response. We are also conducting micro-management of working hours, and making employees and their superiors aware of the need to adjust work when employees reach their working hours.
Supply Chain	Build an internationally competitive supply chain to solve social issues	Sustainable procurement considering environmental and social aspects	ー	Conduct human rights due diligence on major suppliers: Implementation rate for high-risk suppliers by 2025: 100%	Examined internal operational rules with reference to industry trends regarding human rights due diligence. To address the issue of identifying human rights risks in the NIDEC Supplier CSR Self-Assessment (SAQ), we conducted a survey by adding questions about specific products and regions. We measured the probability of human rights violations occurring and the severity of the damage based on supplier information, and identified human rights risks and prioritized initiatives. We are planning to conduct individual interviews and surveys with suppliers that are considered to be at high risk by further refining the evaluation of SAQ items.
Corporate Governance	Create a solid governance system	Build a fair, transparent and highly effective governance system	Board of Directors	Continue to have the effectiveness of the Board of Directors evaluated by a third party Always maintain the ratio of outside directors in the Board of Directors at 50% or more, and the ratio of female directors at 20% or more	In order to ensure the effectiveness of the Board of Directors’ Meetings, a questionnaire is conducted every year for the members of the Board of Directors’ Meeting, including outside members of the Board of Directors, and an evaluation of effectiveness and analysis of issues is carried out. An evaluation by a third party (external law firm) has also been introduced, and it was confirmed that the supervisory function was highly evaluated in FY2023. A Nomination Committee has been established for the appointment of directors and Vice Presidents, and the appointment of the President and review of executive remuneration are carried out.
			Nominating Committee / Remuneration Committee	Increase transparency and fairness in the retirement and dismissal process of directors Improve the effectiveness of the Remuneration Committee and ensure the objectivity and transparency of remuneration decisions for directors	In order to ensure the effectiveness of the Board of Directors’ Meetings, a questionnaire is conducted every year for the members of the Board of Directors’ Meeting, including outside members of the Board of Directors, and an evaluation of effectiveness and analysis of issues is carried out. An evaluation by a third party (external law firm) has also been introduced, and it was confirmed that the supervisory function was highly evaluated in FY2023. A Nomination Committee has been established for the appointment of directors and Vice Presidents, and the appointment of the President and review of executive remuneration are carried out.
			Management and enforcement of internal control	Based on the assumption of 4 trillion yen for sales volume, enhance audit resources in both quality and quantity	We are working to improve and streamline internal audit operations in order to establish a global internal audit system. And we are strengthening our voluntary audit system and monitoring all consolidated companies by utilizing DX.
		Follow thorough compliance with laws and regulations	ー	Expand the legal affairs and compliance system to all Group companies starting from Nidec Corporation and the regional management companies (China, the U.S. and Europe) Identify serious non-compliance risks and take priority measures Provide compliance education to all employees of NIDEC Corporation once a year	The hazard map project is ongoing. Highrisk companies are visualized based on information on remoteness and corruption risk, and measures to mitigate risk are implemented. Human rights due diligence is also carried out to confirm that there is no forced labor or child labor within the NIDEC Group.
		Build a risk management system	ー	All risks disclosed on the securities reports are evaluated by the department in charge, and the risks to be addressed in priority are identified Reduce the impact of the risks to be addressed in priority on our business Manage the progress of reducing such impact and the residual risks	Each department in charge of risk management will carefully examine whether the risk events that are the subject of evaluation reflect changes in the internal and external business environment and customer requests. In addition, the scope of risk events will be narrowed down with the aim of reducing the workload of risk evaluators.
		Promote information security measures	ー	Reduce the number of serious information security incidents to zero	In addition to taking measures against external threats such as conventional cyber attacks, we are also promoting measures against “threats that lie within the company”. We are focusing on education and raising awareness to prevent information leaks due to employee carelessness or rule violations, and have introduced a system to deter and detect malicious acts by internal parties.