Basic Policy

In an environment where the working population continues to decline, the Group considers that securing human resources to support its medium/long-term business strategy and increasing the value of each employee are the urgent issues to be addressed as our management challenges. We will strengthen recruitment activities while enriching our recruitment methods and tools. At the same time, we increase engagement by promoting DE&I by creating a system which enables diverse work styles. In order to realize “Our Ideal State in 2030”, we will promote initiatives to strengthen the foundation of human capital management, which is a core element of enhancing corporate value through sustainable growth.

Initiatives on human resource strategy

Talent Acquisition

Securing skilled human resources is essential for the Group’s business growth amid a declining working population. While improving recruitment capabilities by increasing salaries and the popularity of the Company, expanding recruitment methods, and reviewing the personnel system, we are actively engaging in recruitment activities to secure and retain excellent human resources.

Initiatives to raise the popularity of the Company

When job seekers send applications or accept a job offer, the popularity of a company is becoming more and more important. As a BtoB manufacturing company, our popularity is poor when compared to BtoC companies, and we are making efforts to boost it.

• “All Night Nippon” radio commercial (from January 2025)
• Sponsorship contract with the Ibaraki Robots (from December 2024)
• Holding a sponsored Kashima Antlers match (March 2025)

Career-track system for a specific area

In March 2024, we launched a career-track system for a specific area with the goal of attracting and retaining individuals who want to be career-track employees, but are unable to transfer because of specific circumstances. We want them to obtain work experience in their preferred areas and eventually become highly skilled managers. In 2024, one individual was hired as a careertrack employee for a specific area.

Support system for scholarship refunds

We plan to introduce a support system for scholarship refunds with the aim of strengthening recruitment and job security for career-track positions. By supporting the employees in reimbursing their scholarship, we will create an environment in which young employees can work with peace of mind for a long time.

Referral hiring system

In April 2025, the Company implemented a referral hiring system with the goal of acquiring human resources by introducing qualified individuals through personal ties. We believe that this will not only increase our recruitment capabilities, but also help us improve retention rate.

Compensation (improvement of working conditions)

The Company believes that it is important to improve working conditions of employees in order to realize a virtuous cycle of securing human resources, investing in human capital, and achieving business growth. In the spring labor offensive of 2024 and 2025, we raised the base pay to fully satisfy the labor union’s request. Furthermore, in 2024, we also improved the position and working environment allowances for frontline workers. The Company will strive to realize a virtuous cycle of employees and business growth.

Creating Human Added Value

Recognizing human resources as the source of our competitiveness, we will create added value by providing education and training through mainly on-the-job training and growth opportunities.

Active participation of women (training for female leaders)

In 2016, we established a Committee for the Promotion of the Active Participation by Women. Since then, we have continued to improve our in-house systems, provide training, and raise awareness through in-house public relations. Currently, we have set a target of increasing the ratio of female managers to 2% by 2027 in order to reflect diverse opinions in management. In 2024, we provided training for female leaders who were the candidates for the management. Currently, the ratio of female managers is 1.7%.

Study program at educational institutions in Japan (study at a junior college of industrial technology)

We have established a study program at educational institutions in Japan with the aim of developing human resources useful for the Company’s operations.

DC&M activities

Maintaining and improving practical capacities is essential to the sustainable growth of a company. Therefore, we have formulated an education and training plan to acquire skills and techniques related to manufacturing and equipment, and competence evaluations are conducted upon completion. Furthermore, with the goal of achieving “continuous improvement” and creating an “autonomous and strong workplace” that promotes growth, we are developing DC&M (Denko Circle & Management) activities on a company-wide scale, which are small-group initiatives with increased active management involvement.

Dialogue between managers and the President & CEO

In April 2025, the President & CEO and all managers engaged in a dialogue, like in 2024. The managers prepared a report in advance on the theme “Questions to the President & CEO and Business Issues in 2025: How to Achieve Our Ideal State” and engaged in dialogue with the President & CEO. The members of the group exchanged their opinions on what should be done. In parallel with these efforts, we are promoting information sharing and active communication through dialogue at each workplace and level.

Strengthening the Foundation of Human Capital Management
(well-being management and diversity promotion)

In order to strengthen the foundation of human capital management, we are working on well-being management and diversity promotion through DE&I, work-style reform, and engagement. We are also developing systems and environments in which each employee can play an active role to create a workplace where diverse human resources can work with peace of mind.

Well-being management

Flexible work style

The Company is promoting a flexible work style with no restrictions on time and place. For clerical staff, we have adopted a flex-time work system and a telecommuting system. We have also established a career return system that allows employees who have left the Company due to childbirth, childcare, nursing care, or relocation of their spouses to re-join the Company.

• Telecommuting system
• Flex-time work system
• Career return system

Balancing work with childcare and nursing care

We have designed a system that allows employees to take leave according to their individual circumstances and life stages. We made it mandatory for employees to take at least six days of annual paid leave, which is more than the minimum needed by law, and have established an environment that encourages people to take paid leave. In 2024, 75.6% of employees used paid leave. In terms of childcare leave, we have implemented a system that goes above and beyond the legal requirements by paying salaries for a portion of the leave. When an employee or an employee’s spouse becomes pregnant, we conduct an explanatory session on childcare leave and shortened working hours so that employee’s whole family can make preparations for childcare. In 2025, we have implemented a paid special leave program for attending school activities. As a result of these efforts, we have obtained “Kurumin” certification for the first time in 2019 and the second time in 2021 and will continue to obtain Kurumin certification.

	FY2024	FY2027
Rate of Paid Holidays Taken	Results 75.6%	Target 70% or higher
Ratio of Male Employees Who have Taken Childcare Leave	Results 90.5%	-

• System for taking paid leave on a half-day basis and mandatory use of six days per year
• Childcare leave program that goes beyond the legal requirements (partially paid)
• Shortened working hours for childcare (until the end of the third year of elementary school) and work restrictions (overtime, late at night, etc.)
• Allowances for babysitting fees
• Special leave for caring for a child (paid, up to 10 days)
• Special leave for attending children’s school events (paid, up to 2 days)
• Nursing care leave program (period of nursing-care leave: 1 year) and leave for nursing (paid, up to 10 days)

Mental and physical health care

We provide allowances for medical checkups and follow up on the results so that employees can work in good physical and mental health and maximize their performance.

• Subsidizing the cost of complete physical examinations in addition to health checkups
• Full subsidies for specific health checkups that lead to early treatment of female-specific cancer diseases
• Allowances for the cost of vaccinations
• Implementing a stress check (establishment of a system to promptly conduct interviews with an industrial physician when it is determined that the worker is overworked)
• Establishing an external consultation service consisting of a group of specialists as a stress reduction measure

Updating the personnel management system

We have updated the personnel management system to improve operational efficiency and visualize human resource information. In the future, we will gradually expand access rights to employees and add new functions to create a more efficient and transparent job execution system.

Improving the employee evaluation system (dialogue sheets)

In November 2024, we have modified the dialogue sheets used in the periodic review and made the evaluation criteria open to employees, with the goal of creating deeper dialogue between superiors and subordinates and achieving “Our Ideal State in 2030.” Individual goals related to the realization of “Our Ideal State” are established in the new dialogue sheets at the start of the fiscal year, and progress toward the goals and the process are reviewed throughout and at the end of the fiscal year. We aimed to create an employee evaluation system in which superiors and subordinates can communicate in every situation and share their findings and issues, allowing them to take the next step with confidence.

Diversity promotion

Active participation by people with disabilities

We are working to promote employment and create a productive workplace environment for people with disabilities, as we consider that this is an important social issue. In May 2024, we held an in-house seminar on this theme to deepen awareness of the employment of people with disabilities. We will continue to recruit and maintain those employees and create an environment in which they can play an active role. The employment rate in 2024 was 1.88%.

Active participation by senior talent

The mandatory retirement age has been set at 65 years old so that employees with plenty of knowledge and experience can continue to work after reaching 60 years old, which maintains and strengthens practical capacities and ensures stable life. We have established a consistent employment system in which employees engage in the same work even after turning 60 years old.

Respecting Human Rights

We recognize that compliance with laws and regulations and respect for human rights are not only social responsibilities companies must fulfill, but also essential ethical standards in realizing our management philosophy. Based on this belief, we have formulated the “Nippon Denko Group’ Basic Policy on Human Rights.” By creating an open workplace that respects human rights, we aim to be a company in which each employee, regardless of gender, nationality, or educational background, can make the most of his or her individuality and strengths and diverse human resources maximize their various attractions.