ESG Initiatives

ESG Challenges

Upon the start of Obayashi Group Medium-Term Business Plan 2017, Obayashi sets its sights on Vision for the Future. Inspired by it, we are better clarifying the social challenges we are addressing and promoting initiatives to overcome those challenges.

In FY2018.3, we followed the Obayashi Philosophy to begin pinpointing the challenges that are relevant to the Obayashi Group's business domains and that have a major impact on both society and on the Group. By seeking the advice of outside institutions and referencing sources such as international guidelines*1 and the Sustainable Development Goals (SDGs), we have narrowed down to 22 ESG challenges out of around 300 salient ESG issues.

We will use these selected ESG challenges to evaluate their interest to and impact on stakeholders, as well as their importance and impact on the Obayashi Group. We will then identify our ESG Priority Challenges as we assign numerical targets (KPI) for each challenge. We will work to communicate with a wide range of stakeholders by disclosing information. This will include the status of the specified challenges and of the action we are taking through our business, as well as how well we are achieving goals. Meanwhile, we are continuously implementing action toward overcoming the challenges.

*1 International guidelines
We referenced global frameworks from the following international institutions, NGOs and other organizations.
- International Integrated Reporting Council (IIRC)
- Sustainability Accounting Standards Board (SASB)
- Global Reporting Initiative (GRI)
- World Economic Forum (WEF)
- Morgan Stanley Capital International (MSCI) ESG Index

Obayashi Code of Conduct & ESG Challenges

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Supporting Global Initiatives

Initiatives for Sustainable Development Goals

The UN Sustainable Development Summit was held at UN Headquarters in New York City in September 2015. The outcome was "Transforming our World: the 2030 Agenda for Sustainable Development," a document adopted by the more than 150 heads of UN member states in attendance. The plan of action for people, planet, and prosperity sets out 17 goals with 169 specific targets as the Sustainable Development Goals (SDGs). It calls on enterprises to make proactive efforts to achieve these.

At the Obayashi Group, we link SDG's goals to our business in accordance with the Obayashi Philosophy. We will continue making contributions through our business to overcome the ESG challenges and achieve the goals of the SDGs.

Relationship between the ESG Challenges and SDGs

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Participation in the UN Global Compact

Obayashi joined the UN Global Compact*2 in August 2013. The UN Global Compact supports 10 principles covering Human Rights, Labor, the Environment and Anti-Corruption. As a global company, we run our business responsibility to contribute to the creation of a sustainable society.

*2 UN Global Compact
The Compact was advocated by then UN Secretary-General Kofi Annan in 1999, then officially launched in 2000 at UN Headquarters in New York. It is an international initiative to achieve healthy globalization and a sustainable society. It calls for the rollout of corporate strategies and activities that comply with and put into practice 10 principles in four areas: Human Rights, Labor, the Environment and Anti-Corruption.

UN Global Compact Action in Accordance with the Obayashi Philosophy
Human Rights Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights; and

Value every one of our associates
(Human resources)

Principle 2: make sure that they are not complicit in human rights abuses.
Labor Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;

Value every one of our associates (Human resources)(Health and safety)

Principle 4: the elimination of all forms of forced and compulsory labor;
Principle 5: the effective abolition of child labor; and
Principle 6: the elimination of discrimination in respect of employment and occupation.
Environment Principle 7: Businesses should support a precautionary approach to environmental challenges;

Foster an environmentally responsible society

Principle 8: undertake initiatives to promote greater environmental responsibility; and
Principle 9: encourage the development and diffusion of environmentally friendly technologies.
Anti-Corruption Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.

Ensure strict adherence to corporate ethics

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Stakeholder Engagement

We consider stakeholders to be anyone who is impacted economically, environmentally or socially by our business, as well as those who have an impact on the Group. Through various aspects of our business, we value interactive communication with stakeholders, we reflect the opinions and requests of stakeholders in our business activities, and we respond to the expectations and demands of society. Below are our specific communication tools.

For Stakeholders Main Communication Tools & Details

Customers

  • Consistent quality control based on a quality management system provides high-quality buildings, infrastructure, and services that satisfy customers.
  • We provide solutions by developing advanced technology that addresses customers' diverse needs.
  • Our support ranges from formulation of disastertime Business Continuity Plan (BCP) to restoration projects.

Shareholders & Investors

  • By building an effective corporate governance framework, we aim for sustained growth to increase the transparency and soundness of management, as well as for enhanced corporate value over the medium- to long-term.
  • First, we try to sustain stable dividend payouts over the long term. We endeavor to provide shareholders with returns commensurate with the Groupʼs performance, while considering the need to enhance internal reserves so we can further improve our financial base and prepare for the future.
  • In our efforts to maintain close communication, we broadly and equitably disclose timely and important information on our business, while striving to sufficiently disclose information through constructive dialogue.

Employees

  • We respect human rights and diversity, and we encourage the creation of a work environment and systems where each employee can exercise their unique character and talents.
  • We believe that a company's growth is supported by each and every employee. We support skill development through means such as our many training programs.
  • To keep employees safe and healthy, we create a comfortable workplace environment while building a support system for mental and physical health.

Suppliers

  • As partners who can grow with us, we conduct fair transactions with suppliers and build stronger mutual trust with them.
  • We respect the human rights of all employees and workers and seek to create a pleasant work environment that promotes their health and safety.

Local communities

  • As a good corporate citizen, we seek to realize a sustainable society and implement proactive initiatives for CSR.
  • While each employee acts sensibly, based on a sophisticated understanding of ethics, they volunteer to participate in CSR activities that contribute to the sustained development of local communities.

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