Material IssuesOverall businessContributions to the business sideContributions to a sustainable global environmentEnvironmentRespect for human rightsSocietyImprovement in value chain managementStrengthening of com-munication with stakeholdersGovernancePromotion of Groupwide governanceRisks Associated with Material Issues• Raw material procurement and logistics risks• Loss of business opportunities due to delays in technological innovation• Increased investment costs for environmental measures• Impact on procurement, including costs due to high dependence on chemicals, petrochemicals, and other raw materials• Decrease in the availability of raw materials due to tighter environmental regulations• Suspension of operations or damages incurred due to problems related to human rights in the supply chain • Loss of opportunities to secure excellent global human resources and the outflow of such talent • Decrease in labor productivity and an exodus of human resources• Loss of customer confidence due to lack of appro-priate quality control• Decline of trust from local communities due to poor communication• Decline in corporate reputation due to lack of integrity in information disclosure (reputation risk)• Impact on operations from a lack of management decisions based on objective perspectives • Impact on corporate activities of insufficient governance at Group companies overseas• Damage to corporate value due to noncomplianceSTEP 1STEP 4Opportunities Associated with Material Issues• Introduce innovative new production equipment in the pursuit of cost reductions and create new products using new manufacturing methods• Create new products and businesses through technological innovation and diversify operations • Through DX, improve R&D efficiency, accuracy, and inspection system technologies• Build smart factories that do not rely on external electrical power or other sources• Expand markets by providing environmentally friendly products and services• Transition from the use of petrochemical raw materials to biomass materials• Accelerate the search for and conversion to alter-native products and promote the development of raw materials from unique recipes• Develop products using raw materials on positive lists• By promulgating the corporate culture, foster a greater awareness among employees of how they can help realize a sustainable society• Motivate employees by creating a safe and secure working environment• Encourage varied business decisions by diverse human resources• Foster safe and secure business activities by ascertaining appropriate information and through system configuration• Achieve coexistence and co-prosperity with local communitiesstakeholders• Reflect in business activities issues of interest to • Expand business by making appropriate manage-ment decisions• Improve internal control systems to prevent acts that are illegal, improper, or unfair• Enhance trust and satisfaction among stakeholdersThe LINTEC Group has identified material issues, which are areas of particular focus within its wide range of CSR activities. We first identified these issues in 2014. We revised our material issues in 2021, after taking into account ongoing changes in social issues and our daily stakeholder dialogues. The new material issues incorporate LSV 2030, our long-term vision that looks ahead to 2030, as well as an SDG perspective. This year, we have also defined key performance indicators (KPIs) corresponding to the material issues. As it moves forward with its activities, the LINTEC Group will focus on these material issue themes.Analyze Value ChainWe evaluated our value chain and summarized the business activities and ESG themes for each department. We also analyzed risks and opportu-nities for each ESG theme in the value chain.Identify Material IssuesWe identified material issues after evaluating areas judged to be of importance, using map distribution to shed light on social demands and internal importance to LINTEC.48List of Material IssuesMaterial Issues (Important Issues)Process for Reviewing Material Issues
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