MAZDA ANNUAL REPORT 2016 Mazda CSR Areas of CSR Initiatives Corporate Vision*1 Referencing the Charter of Corporate Behavior issued by the Japan Business Federation (Nippon Keidanren), etc., Mazda classifies and evaluates its CSR initiatives. The areas of CSR initiatives are periodically reviewed and revised in the light of issues in the business activities of the automotive industry and Mazda, as well as social issues to which stakeholders attach particular importance. The most recent review was made in July 2016, by which the Company defined the following as the key areas of its CSR initiatives: Customer Satisfaction, Quality, Safety, Environment, Respect for People, and Social Contributions. We love cars and want people to enjoy fulfilling lives through cars. We envision cars existing sustainably with the earth and society, and we will continue to tackle challenges with creative ideas. 1. Brighten people’s lives through car ownership. 2. Offer cars that are sustainable with the earth and society to more people. 3. Embrace challenges and seek to master the Doh (“Way” or “Path”) of creativity. Organization CSR Promotion Organization Customers Next generation people (Environment) Shareholders and investors Customer Satisfaction Safety Environment CSR Social Contributions Global society Local communities Bus in Quality Respect for People nce ess ac tivities with complia Business partners Mazda employees *3GRI: The Global Reporting Initiative, which provides the guidelines for CSR information disclosure *4Announced in September 2015. SDGs call on United Nations member nations to mobilize efforts to achieve sustainable development by accomplishing such targets as ending poverty and hunger, ensuring access to affordable and clean energy, combating climate change, and promoting peaceful and inclusive societies between 2015 and 2030. SDGs comprise 17 goals with 169 targets. http://www.mazda.com/en/csr/download/ 28 Contents Message from Management Meetings: Held as required Members: Working members of primary departments involved in carrying out CSR initiatives Based on the GRI Sustainability Reporting Guidelines Version 4 (G4)*3, starting in the March 2014 fiscal year, Mazda has been implementing the four-phase process (Step 1 – Step 4) to identify the key areas of its CSR initiatives (materiality), reviewing the social issues that the Company should address. In identifying materiality, Mazda reflected Mazda Group Mazda Group companies in Japan companies overseas the external opinions of experts and various other stakeholders, while taking into account internal opinions both from management and relevant divisions. As a result, in July 2016 the CSR Management Strategy Committee approved the new materiality, and the information is disclosed in Mazda Sustainability Report 2016 in accordance with the Core option of the G4 guidelines. During the materiality-identifying process, Mazda has also referenced the Sustainable Development Goals (SDGs)*4 adopted by the United Nations. In the future, Mazda will continue to review materiality on a regular basis, while being conscious to various issues inside and outside the Company. Social Contributions For specific Mazda CSR activities, please see the Mazda Sustainability Report 2016. Company Departments and Sections Respect for People *1 M azda revised its Corporate Vision in April 2015, with the following objectives, aiming to be recognized as a company gaining sincere trust of its stakeholders. · Clarify the attributes of the Mazda brand, and make concerted efforts across the Mazda Group to realize the Corporate Vision. · Promote the Group-wide dialogue process to share, understand, and agree the goal of the Corporate Vision through continuous, thorough discussions. · Closely link the Corporate Vision to our daily business activities. *2The seven principles shared by all Mazda Group employees in the execution of their everyday work: integrity, basics / flawless execution, continuous kaizen (improvement), challenger spirit, self-initiative, tomoiku (mutual growth / success), ONE MAZDA. CSR Strategy Core Team Review and Identification of Key Areas of CSR Initiatives (Materiality) Environment Mazda aims to achieve its Corporate Vision through the actions of each individual, based on the Mazda Way. While striving to meet the requests and expectations of all of Mazda’s stakeholders, all employees pursue CSR initiatives in the course of their daily business activities. In this way, Mazda contributes to the development of a sustainable society. Secretariat (CSR & Environment Department) Safety Basic Approach Meetings: Twice annually Chairperson: Representative Director, President and CEO Vice Chairperson: Executive Officer in charge of CSR and environmental affairs Members: Members of the Executive Committee Quality Mazda Way* 2 CSR Management Strategy Committee Customer Satisfaction All Mazda stakeholders Each department carries out its operations based on goals and plans formulated with an understanding of the policies and guidelines determined by the CSR Management Strategy Committee, which the president chairs, and in cooperation with other Group companies. In the March 2016 fiscal year, the Board of Directors held discussions on issues concerning sustainability. Review of Operations Drivers of Value Creation Foundations Underpinning Sustainable Growth Financial Section MAZDA ANNUAL REPORT 2016 Mazda CSR Process of Reviewing and Identifying Key Areas of CSR Initiatives (Materiality) STEP 1 Extraction of social issues STEP 3 Validation Reconfirm the validation of the boundaries of aspects identified in Step 2 based on the business plan, etc. The CSR Management Strategy Committee approved the validation in July 2016. STEP 4 Category III High Prioritization (Conduct interviews with external experts) Extremely high STEP 2 Evaluate the importance of the social issues extracted in Step 1, grade them and show the graded scores by mapping according to the following two axes, to identify the aspects with greatest importance (the status was reported to CSR Management Strategy Committee.) • Horizontal axis: Significance of Mazda Group impacts (graded by Mazda’s relevant divisions, from such viewpoints as the possibilities for existing risks and opportunities at Mazda, and the significance of their impact) • Vertical axis: Influence on stakeholders (graded by external experts, from such viewpoints as the relationship with the business activities of the automotive industry and Mazda, and of the possibilities for having impact) Influence on stakeholders*1 Extract aspects of greatest importance from among the 46 specific standard disclosure aspects specified in the G4 guidelines, from the following perspectives, and clarify the scope of expected impact (boundary) of each aspect. • Social issues in the business activities of the automotive industry and Mazda • Social issues to which stakeholders attach particular importance or that have substantive influence when stakeholders evaluate Mazda Mazda Group’s Key Areas of CSR Initiatives (Materiality) (As of July 2016) Category IV Category II High II Extremely high Significance of Mazda Group impacts*2 III Where significance of Mazda Group impact is extremely high Where significance of Mazda Group impact is high *1 Expectation to Mazda Group and automotive industry *2Risk and opportunity for Mazda IV Disclose the materiality aspects identified in Steps 1-3 and the management reporting results (Mazda disclosed them for the first time in the Mazda Sustainability Report 2016). Continuously collect the opinions of stakeholders inside and outside the Company and carry out periodic reviews to develop the PDCA (plando-check-act) process. (As of July 2016) Category Items* I Category I D isclosure of identification results and development of PDCA cycle (disclosed in Mazda Sustainability Report 2016) CHECK Materiality items (Economic) (Environmental) (Environmental) (Environmental) (Environmental) (Environmental) (Labor practices) (Labor practices) (Consumer issues) (Economic) (Environmental) (Labor practices) (Labor practices) (Economic) (Environmental) (Environmental) (Labor practices) (Social) (Social) (Consumer issues) (Consumer issues) (Economic) (Environmental) (Labor practices) (Labor practices) (Human rights) (Human rights) (Social) (Social) (Consumer issues) (Consumer issues) Indirect Economic Impacts Energy Water Source in Community Emissions Effluents and Waste Products and Services Occupational Health and Safety Diversity and Equal Opportunity Customer Health and Safety Economic Performance Transport Employment Training and Education Market Presence Materials Supplier Environmental Assessment Supplier Assessment for Labor Practices Social Community Supplier Assessment for Impacts on Society Product and Service Labeling Compliance of product area Purchasing practices Compliance of Environmental area Labor/Management Relations Equal Remuneration for Women and Men Forced or Compulsory Labor Assessment Anti-corruption Compliance of social area Marketing Communications Customer Privacy * The item in each category is listed in G4 guidelines order. External Evaluations of CSR (As of June 1, 2016) Mazda identifies key external ratings and evaluations both from within Japan and overseas. By analyzing the results, Mazda evaluates its own initiatives. Mazda continuously makes active efforts to disclose information by responding to both domestic and global surveys and evaluations, such as those by socially responsible investment (SRI) and environment, social, and governance (ESG) rating organizations. • Inclusion in the FTSE4Good Index series since March 2011. An SRI index developed by the FTSE Group, a fully-owned subsidiary of the London Stock Exchange. • Inclusion in the STOXX Global ESG Leaders Index since September 2013. STOXX is a global-index-development company located in Switzerland. Mazda is also selected in the sub-index of social criteria in “STOXX Global ESG Social Leaders.” • Inclusion in the Ethibel EXCELLENCE Investment Register since October 1, 2013. Forum ETHIBEL is a Belgium-based non-profit organization that promotes socially responsible investment (SRI) and CSR in Europe. 29 Contents Message from Management Review of Operations • Inclusion in the MSCI Global Sustainability Index since June 1, 2015. An SRI index developed by MSCI (Morgan Stanley Capital International). The indexes include companies with high ESG rating in their industry sectors. • Inclusion in the Morningstar Socially Responsible Investment Index (MS-SRI) since January 2008. The first SRI index developed in Japan. • In the CDP Japan 500 Climate Change Report 2015, Mazda’s carbon disclosure score was 98 (out of 100), with its performance score rated in Band B. On behalf of 822 institutional investors with assets of US$95 trillion the CDP organization conducts research and discloses information to better understand the risks and opportunities posed by climate change. Drivers of Value Creation Foundations Underpinning Sustainable Growth Financial Section
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