kuraray


Management Report

CSR Management

Compliance

Basic Approach to Compliance

“Our Commitment” states the principles of our conduct wich we should observe in doing our business. “Kuraray Group Code of Conduct” serves as guidelines to implement the commitment in performing day-to-day work. Top management of Kuraray Group has declared that we will comply with laws and regulations and “Our Commitment” under any circumstances. In order to share these principles and commitments among all Kuraray Group personnel throughout the world, Compliance Handbook has been compiled containing the foregoing declaration by the top person and explanations of “Kuraray Group Code of Conduct.”

In order to disseminate these principles and commitments among all Kuraray Group employees, a compliance handbook has been distributed to the Group employees throughout the world. The handbook contains the foregoing declaration by the top executive and explanations of the Kuraray Group Code of Conduct and is written in eight languages, Japanese, English, German, Chinese, Hangul, Russian, Flemish and Czech.

We plan to appoint compliance officers at Plants, Offices and Laboratories of Kuraray and group companies and to organize a compliance committee in each region to effectively and sustainably promote and implement compliance activities within the group as a whole.

Whistleblower System

As a whistleblower system to prevent and to identify and troubleshoot any compliance violation at an early stage, Kuraray Group Employee Counseling Room has been set up for all employees of domestic Kuraray group including part-time employees, contract employees and dispatched staffs. Whistleblower contact windows are also provided at major subsidiaries in Europe and North America. In recent years, globalization of Kuraray Group has accelerated rapidly through M&A and other activities and the group is building a system at subsidiaries that do not have such contact windows yet, allowing all employees of the group inside and outside Japan to access a contact window.

Number of Consultations at Kuraray Group Employee Counseling Room
FY 2012 2013 2014 2015 2016
Number of Consultations at Kuraray Group Employee Counseling Room 5 1 1 3 4

Actions Taken for More Thorough Compliance with the Law

In March 2016, the Fair Trade Commission of Japan made an on-the-spot inspection of Kuraray, involving competitive bidding on textile products purchased by the Acquisition, Technology and Logistics Agency, Defense Ministry. Subsequently, in March 2017, the commission ruled that Kuraray had violated the Anti-Monopoly Law and issued a cease-anddesist order. Responding sincerely to this fact, Kuraray has implemented the following measures to enable each of the officers and employees of the Kuraray Group to more thoroughly comply with the laws and regulations.

Nevertheless, in February 2017, the Fair Trade Commission of Japan made an on-the-spot inspection again at Kuraray on the manufacture and sale of activated carbon used in water purification facilities, waste incinerators and other facilities. We take the series of these events seriously and sincerely and will implement all necessary measures to ensure such incidents will never recur, as we fully cooperate with the inspection by the commission and will clarify the points that should be improved on the following aspects and will reinforce the countermeasure.

Status of Activities
[Message from Top Executive]

In response to the on-the-spot inspection by the Fair Trade Commission of Japan, the top executive issued a message to all the officers and employees of the Kuraray Group instructing stricter compliance with the Anti-Monopoly Law. The message from the top executive was posted on Kuraray’s intranet, bulletin boards and other places in order to ensure information dissemination and stricter compliance.

[Amendment of Guidelines on Compliance with the Anti-Monopoly Law]

To assist and ensure more thorough compliance with the Anti- Monopoly Law, Kuraray’s Guidelines on Compliance with the Anti- Monopoly Law were newly published, adding an easy-to-understand e xplanation o f those mat t er s that should r ec eiv e at t ention in accomplishing routine work as viewed from a global perspective. The newly published guideline handbook was distributed to the officers and employees of Kuraray and related parties in Japan. In the light of the violations and other cases, all the divisions checked their transactions thoroughly.

[Enlightenment, Education and Training]

An outside expert was invited to seminars held by Kuraray on the Anti- Monopoly Law attended by the sales personnel of Kuraray, as well as all the managerial personnel in the Tokyo and Osaka Head Offices. All the Kuraray employees in Japan received a course of e-learning lessons to further raise their awareness about compliance with the laws and regulations.

[Creation and Updating of Rules]

A variety of measures have been implemented including a revision of the employment rules with an emphasis on compliance with laws and regulations and the setting of new rules of contact in dealing with other companies in the same trade.