Human Resource Management and Development

Basic Concept

The entire group must work together to implement personnel policies, systematic human resource development for successors to senior management and all levels, and D&I activities to realize its slogan; "we hold dear a corporate culture in which our employees can proudly work with vigor and boldly engage in new endeavors," as stated in the Group VALUE. To this end, the Nisshinbo Group adopted the Group human resources policy of "Business is people: Business success or failure depends on human intelligence and virtue," and is pursuing the human resources strategy in accordance with the following eight basic policies.

Nisshinbo Group Human Resources Policy

Business is people ―Business success or failure depends on human intelligence and virtue^*－

• ① With regard to human resources able to contribute to the development of business now and in the future, Nisshinbo will
• ② Recruit, train and place people in the right job,
• ③ Encourage enthusiasm and creativity,
• ④ Maintain physical and mental health,
• ⑤ Evaluate employees fairly and treat them appropriately, and

Provide ongoing training and allocate people generating appropriate earnings at each level and function.

* Intelligence and virtue: A compound of "talent and wisdom" and "moral conduct."

Nisshinbo Group Human Resources Strategy

• ① Formulate and promote personnel policies with a sense of unity and uniformity across the entire group.
• ② Create a workplace culture in which diverse human resources are motivated to work and take on challenges to improve business performance.
• ③ Management executives and successors
  • ・ Systematically develop leaders who can take on challenges and make changes in an era of uncertainty and a lack of right answers.
  • ・ Create leaders who can compete globally.
• ④ Managers and management candidates
  • ・ Create managers who can drive the enhancement of commercialization and profitability through creation and innovation, and earn money correctly.
• ⑤ General employees
  • ・ Develop human resources who can respond to major trends in technological innovation and realize improvements in business efficiency and productivity.
  • ・ Cultivate human resources who will be candidates for future reform leaders.
• ⑥ Create a work environment where all employees can work in good mental and physical health and contribute to business performance.
• ⑦ Create a system that leads to the recruitment and promotion of excellent human resources through the integration of diverse human resources.
• ⑧ Create a simpler and more balanced compensation system that reflects the activities and performance of diverse human resources.

Promotion System

Based on the human resources policy: "Business is people," under a system in which the director and the chief of the Corporate Strategy Center of Nisshinbo Holdings, Inc. is in charge, the Nisshinbo Group is committed to acquiring and developing human resources with a view to future business development. In addition, the Human Resources Group of the Human Resources & Administration Service Department of the Corporate Strategy Center holds a "Group Human Resources Division Meeting" twice a year to discuss human resources-related policies and issues across the Group.

The Group has set Key performance indicators (KPIs) and taken measures to achieve the goals in the Fifth Sustainability Promotion Plan, which are "Training of management candidates necessary for business promotion" and "Strengthen mid-career recruitment to improve the age structure of human resources."

• Sustainability Promotion Plan and KPIs

Specific Initiatives of the Nisshinbo Group

In the "Fifth Sustainability Promotion Plan," the Group has designated human resource acquisition and training as a key action items and is working on human resource management and development. The Group has set KPIs for ① Increase the rate of participants in the Successor Program in senior management posts (executive officers and above) and ② Strengthen mid-career recruitment to improve the age structure of human resources, and is promoting activities while implementing the PDCA cycle.

Recruitment and Retention of Human Resources

In order to create a group of human resources with more diverse backgrounds and to correct the age structure of the workforce, the Group is reinforcing the number of career hires in addition to new graduates (approximately the same number of new graduates and career hires). In order to ensure diversity, the Group is actively recruiting women and non-Japanese employees in particular. In addition, the following measures are being implemented to attract and promote excellent career hires.

• ① Maintain competitive salary levels
• ② Role grading system to clarify job descriptions
• ③ Personnel system that enables early promotion regardless of length of service
• ④ A multitrack personnel system that accommodates different work styles and occupational perspectives
• ⑤ Improvement of working environment, such as teleworking system and satellite offices
• ⑥ Enhancement of training and follow-up for career hires
• ⑦ Employee referral system (referral system) to introduce employees' acquaintances
• ⑧ Re-entry system for employees who retired for personal reasons (Re-join System)
• ⑨ A system to provide leave and allowances for every five years of service (Discovery Leave System)

In the future, the Group will consider treatment for highly specialized and job-specific positions and plan measures to increase flexibility in terms of work location and hours.

The Nisshinbo Group is implementing the following measures to prevent employee turnover.

• ① In addition to personnel evaluation interviews by supervisors, regular interviews using career sheets are conducted to support career development.
• ② The Nisshinbo Group operates the New Challenge System across the Group to increase opportunities for more employees with diverse values and occupational perspectives to develop skills and take on new business challenges on their own and to eliminate mismatches after joining the company or being assigned to a new position.
• ③ Career training is provided as an opportunity to learn about the impact of environmental changes on careers and to consider new ways of working and learning in the future.

In addition, to prevent young employees from leaving the company, the Group opens the Learning Management System to them from the initial job offer stage based on the onboarding concept, and have interviews with HR personnel, the Group established a mentor system for first-year employees, and HR personnel conduct follow-up interviews and questionnaires to detect changes at an early stage and implement appropriate measures to help them adjust smoothly to life at the company. In addition, Follow-up group training is held in the first, second, third, and fifth years of employment, and follow-up new employee training and career training are provided to ensure that employees remain with the company.

Human Resource Training

Training System Chart

Digital Human Resource Development

The Learning Management System, introduced in 2021, prepares digital-related courses as standard content, allowing employees to learn at their leisure. In 2023, the number of digital-related e-learning courses was expanded from 5 to 21.

In 2020, the same content was updated and systematized as digital literacy training. The program provides a forum for sharing good examples of internal digital-related activities and discussing business improvement plans and new digital business ideas using digital technology across workplaces.

In addition, since 2023, Nisshinbo has been conducting training on problem-solving methods in the age of digital technology with the aim of developing human resources who can utilize digital technology to solve problems at their workplaces, where they learn various problem-solving approaches and thinking methods required for the use of technology.

Nisshinbo will continue to promote a variety of projects to make the use of digital technology more accessible and practical.

Career Support

To encourage the challenge and growth of each employee, the Nisshinbo Group is implementing measures focusing on each individual. The Group provides career training for each generation as an opportunity for each employee to regularly reflect on the individual career and to reconsider career aspirations.

As opportunities to take on new career challenges, the Nisshinbo Group has the New Challenge System, which allows all Nisshinbo Group employees to take on the challenge of transferring to a position they are aiming for and a self-assessment system. In addition, the Group has a mentoring system and career interviews as a mechanism to support employee growth.

To support autonomous learning, the Group is also expanding the Learning Management System menu, which allows employees to take courses anytime, anywhere, on a wide variety of learning subjects.

Management Succession Planning

To develop successors to senior management, a list of potential successors for key positions at each company is prepared annually based on job grades common to the Group, and program is provided for potential successors. Specifically, for general managers and above, the Nisshinbo Group provides cross-industrial exchange training within the Group, including management mindset training to acquire a mindset appropriate for management positions; selective external training to acquire management knowledge, mindset, and role behavior; and practical workshops to acquire the ability to create and breakthrough in business. Furthermore, since FY2020, Nisshinbo dispatched several participants to the Management of Technology (MOT) in order to develop managerial human resources that combine technical knowledge and management skills.

At present, more than 50% of the participants in this program have been appointed to managing officer or higher positions.

Total Number of Participants in the Senior Management Succession Planning Program (2015-2024)

Globalization of Human Resources

To promote the globalization of human resources, the Nisshinbo Group has provided cross-cultural understanding training for those posted overseas, training at language schools for those sent overseas, and English and business Japanese language training jointly sponsored by group companies. In addition, the Group is promoting the development of globally competent human resources through measures to promote overseas experience for employees under the age of 35, subsidies for TOEIC and CASEC exam fees and transportation expenses, half-price subsidies for online English conversation courses, and subsidies for language correspondence courses and e-learning courses.

Specific Activities of the Group Companies

Diverse Human Resource Recruitment and Development Programs

In order to realize our management philosophy—the JRC Group provides superior value through wisdom and creativity and contributes to building the future of people, society, and the world —the Group focuses on recruitment and education. the Group is strengthening the recruitment of a diverse range of human resources through new graduates and career hires, and after joining the company, the Group provides systematic education divided into human resource development education and professional education. The Group is working to create an educational environment in which employees can maximize their abilities and to develop employees who think and act spontaneously with each individual aiming to become a complete professional.

The JRC Group also believes that it is important to encourage career development in order to motivate and improve the abilities of all employees. For this reason, the Group introduced an open recruitment system to provide proactive opportunities for transfers. A total of 37 applications were received in FY2023, resulting in 11 transfers. The open recruitment system is expected not only to develop human resources but also to invigorate the company and lead to changes in the company's culture and constitution.

Education system

Interviews with Younger Employees

Ueda Japan Radio Co., Ltd. conducted personnel interviews for new graduates in their seventh year of employment and for employees in their second year of career employment in fiscal 2023.

<The interviews consisted of the following>

• ① Confirmation of physical condition
• ② Current work content
• ③ Requests to the company
• ④ Future career development

These interviews are conducted by the Human Resources Group as a countermeasure to the high turnover rate of employees before the age of 30 at the company. So far, 20 employees have been interviewed in 2022 and 2023. The results of the interviews were fed back to management and the heads of departments, and any necessary measures were implemented in the workplace. As a result, the company was able to reduce the turnover rate before the age of 30.

In addition, in response to a consultation from the company that there is a large age gap between department heads and younger employees due to the lack of mid-career workers, the company invited an outside lecturer to conduct communication training for each department head. In addition, in response to the results of a survey, individual interviews were held between team leaders and team members to integrate role recognition, and other improvements are being made.

Nisshinbo Micro Devices Human Resource Strategy was Formulated

Nisshinbo Micro Devices Inc. formulated the Human Resources Strategy in order to realize the company's future vision.

In formulating the strategy, the company analyzed changes in the business environment, including human capital management and the declining birthrate and aging population, as well as the company's workforce composition and employee survey results, and based on the corporate philosophy, Nisshinbo Group Human Resources Policy, and Nisshinbo Group Basic Policy on Human Resources Strategy, the company determined the Nisshinbo Micro Devices Human Resources Vision and Nisshinbo Micro Devices' Desired Human Resources Image in conjunction with the management strategy. In order to realize the Nisshinbo Micro Devices Human Resources Vision and Nisshinbo Micro Devices' Desired Human Resources Image, the company formulated three strategies: the Recruiting Strategy, Human Resources Development Strategy, and Engagement Improvement Strategy. In each strategy, the company established policies and main measures and then prioritized and began initiatives .

Through the realization of these human resource strategies, the company is working to realize its ideal future company.

Established Basic Principles for Human Resource Development for The Automobile Brakes Business Group

In June 2023, Nisshinbo Brake Inc. formulated the Basic Principles for Human Resource Development for the Brake Business Group. The philosophy clearly defines the vision of the Brake Business Group and is positioned as a major support for each and every employee in performing assigned duties and fulfilling social responsibilities.

The Automobile Brakes Business Group has three goals: "Understand that our products are responsible for the safety and security of society and aim to achieve this through our own work," "Contribute to society through personal growth and technological improvement by implementing kaizen without fear of change," and "Collaborate to produce results by recognizing, accepting and making the most of diversity."

The purpose of formulating this philosophy is twofold: to align the company's perspective with that of its employees in terms of human resource development and to clarify Nisshinbo Brake's approach and policy toward human resource development to employees so that they can better understand it as their own personal matter. In formulating this plan, the company redefined Nisshinbo Brake's approach to human resource development in line with the times.

In order to achieve the Brake Business Group's Vision, the company has been formulating and implementing human resource policies with the basic principles for human resource in mind since FY2024. In the future, the company will promote collaboration with our overseas bases to enhance the value of the Brake Business Group.

Basic principles for human resource development system for the Automobile Brakes Business Group

Strengthening the Human Resources Development System at Nisshinbo Automotive Manufacturing Inc. United States

Nisshinbo Automotive Manufacturing Inc. (NAMI) in the U.S. is working to strengthen its human resource development. The HR focus is on the employee development plan. This plan outlines that person’s professional growth within the organization. The focus is skill development within the current role or skill development for progressing within the current career track, in other words engineer to senior engineer. The benefits of HR strengthening the development system are to find new talent, increase employee retention, increase employee engagement, and achieve Company goals.

NAMI conducts a yearly performance review that has employees create their own goals and/or development plan. The management team develops long-term and short-term goals attached to progression metrics. A timeline is created with quarterly check-ins.

E-learning every month is a means to develop human resources and safety knowledge and/or skills. E-Learning is convenient and provides flexible access for learners, regardless of location or device. This type of learning is self-driven and self-paced. All results are measurable and easy to report. E-Learning is a way to incorporate interactivity and gamification to engage motivated learners. The long-term goal is to incorporate professional skill development with targeted learning to reach the next tier in the employee’s career.

In addition, as part of the labor management training, training was provided for executives in all divisions to acquire the "soft skills" required of team leaders, such as documentation skills, communication skills, and logical thinking.

Measures to Prevent Younger Workers from Leaving the Workforce

Nanbu Plastics Co., Ltd. is implementing the following measures to prevent young employees from leaving the company.

➀ Group training for young employees
This is the third year that the company conducted group training for young employees, targeting new graduates and young career employees in their second and third years with the company. The training includes group work and dialogue with management and senior employees. The group work has helped participants develop horizontal ties and improve their communication skills beyond their own organization, and participants have commented that it was an experience that they can use in the future. In addition, to increase motivation, participants have the opportunity to have lunch with management and directly interact with them to get a sense of what management expects from them.

➁ Mentor System
Nanbu Plastics operates a mentoring program for new employees in which employees who are relatively close in age are individually assigned as mentors, and mentoring is provided for one hour once a month for the first year after joining the company. Mentoring is recommended to be conducted in a place where the two of them can be alone for a while to get away from their usual work and enjoy conversation.

Short-term Training for Young People in Other Departments

Nisshinbo Chemical Inc. is promoting organizational culture reform, and as one of its human resource development activities, the company offers short-term training for young employees in the operations of other departments (C-Training).

By applying for the C-Training program, participants can actually experience the work of other departments, gaining knowledge and diverse perspectives that differ from those of their own departments, thereby promoting their growth. In addition, the program has also produced results in networking through increased communication with employees with whom they had not previously interacted. For the host department, the training also led to a change in mindset as participants became aware of perspectives they had not noticed before, such as the need to clarify daily operations, and this has been a good stimulus.

After the training, debriefing sessions are held, and feedback is provided from those involved, and the training is highly evaluated as a meaningful training program by both participants and the host department. Nisshinbo Chemical Inc. will continue to increase the number of participants who experience this training in order to reform the culture of the entire company.

Support for Obtaining a University Degree

Nisshinbo Do Brasil Industria Textil LTDA. in Brazil offers tuition assistance for educação à distância (EAD), which allows students to obtain a university diploma.

EAD is a learning institution that mainly uses e-learning, and students can obtain a university diploma by taking a prescribed curriculum and passing an examination. Currently, four employees are taking courses in accounting, nursing, environment, and human resources, respectively. The duration of the course differs depending on the subject, but participants are working on the curriculum during weekday evenings and holidays for four to five years in order to obtain the certification. By acquiring qualifications, the company not only spreads new opinions and ideas within the company but also supports them in the hope that they will become key personnel in the future.