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Material issues

Background and Objectives of the Materiality Review

Having identified our material issues in 2022, we have since proceeded to take the appropriate initiatives. However, at the request of our stakeholders, we recently undertook a review to respond to the changing external environment.
On this occasion, in establishing “our Company’s Purpose” , “Long-Term Vision 2035” and “Medium-Term Management Plan 2030”, we redefined and reviewed our materialities in relation to our management strategies and initiatives to achieve our vision.
We will advance to address our material issues in a manner consistent with our management strategies, pursuing key initiatives to achieve growth while continuing to meet stakeholder expectations and creating sustainable value.

Materiality Review Process

The review was undertaken in accordance with the steps given below.
The review details were reported to and discussed by the Sustainability Committee, Management Committee, and Board of Directors where appropriate, with final approval granted by the Board of Directors.

Step

Description

STEP1

Listing of candidate materiality themes

Starting from a broad perspective, we extracted and listed various publications and guidelines, including those published by the SASB and the GRI,* as well as mid- to long-term projections of external environment changes, social issues, and other relevant factors.

* SASB: Sustainability Accounting Standards Board, GRI: Global Reporting Initiative

STEP2

Assessment of degree of materiality

Assessment from our perspective
We assessed the degree of materiality based on the risks, opportunities, and ideals of our company management and businesses, as well as their relevance to the new Medium-Term Management Plan.
- We carried out questionnaire surveys and engaged in discussions with responsible persons at our key businesses and administrative sections.
Assessments from the stakeholder perspective
We assessed the degree of materiality based on the internal and external stakeholder viewpoints expressed.
- We held interviews with institutional investors, business partners, External Directors, and employees.
- We also considered the impact of our company on the environment and society.

STEP3

Considerations of materiality proposals

Based on the results of the assessment in STEP ❷, we identified the priority issues (≈ material issues) to be addressed, with a focus on the themes of high materiality.

STEP4

Consideration of action policies, measures, targets, etc.
for each material issue

For each material issue identified in STEP ❸, we considered various action policies, measures, targets, etc., with the relevant sections playing central roles.

Overview of New Materialities

As part of initiatives to fulfill our Company’s Purpose, to realize Long-Term Vision 2035, and achieve the goals of the Medium-Term Management Plan 2030, we will continue to promote efforts related to the new material issues, manage their progress, make relevant disclosures, and engage in dialogue.

Materiality item	Risk	Opportunity	Action policy
Promoting businesses that help solve social issues	Falling behind competitors in obtaining potential business opportunities	Developing and creating businesses that address new client needs and markets Gaining competitive advantages through proactive initiatives	Achieving business growth as well as helping to build a sustainable society by leveraging the Company’s strengths to solve issues
Contributing to carbon neutrality (CN)	Increased costs due to carbon taxes, etc. Loss of order receipt opportunities or decline in Company ESG rating or reputation due to inability to meet carbon reduction requirements from clients and other parties	Enhancing cost competitiveness through proactive response to carbon tax and energy cost increase Improving the Company’s rating and expanding opportunities to win orders by addressing possible Scope 3 reduction requests from clients in advance From an ESG perspective, gaining recognition and support from investors, clients, and other parties to achieve lower capital costs and develop continuing relationships	Reducing the Company’s CO₂ emissions through environmental investments in logistics facilities and procurement of electricity from renewable energy sources (Scopes 1 and 2) Promoting CO₂ reductions in client-related transportation by addressing modal shifts, etc. (Scope 3)
Ensuring service safety and quality	Decline in revenue or social reputation or liability for compensation, in relation to service delays or operational suspensions due to accidents, etc. Operational suspensions in cases where the logistics network is disrupted due to heavy rain, earthquakes, or typhoons, or where appropriate responses cannot be taken in such situations Operational suspensions due to the deterioration of infrastructures or the breakdown of vehicles or equipment Additional costs or operational suspensions in cases where the Company is not able to comply with gas emission controls or environmental regulations	Securing competitive advantages through improved safety and reliability; promoting services that excel in accident prevention or quality control as points of competitive differentiation Earning client trust by providing stable services even during disasters Enhancing employee satisfaction and productivity through improving working environments, thereby helping to secure human resources and reducing turnover rates	On-site accident prevention and mitigation Initiatives to prevent quality-related incidents Enhancing companywide resilience
Sophisticating governance	Statutory violations and litigation risks directly resulting from inadequate response in areas related to governance, human rights, or compliance Loss of stakeholder trust due to insufficient information disclosure, resulting in a lower ESG rating or damage to reputation	Maintaining sound and efficient management by continuing to strengthen and improve governance Strengthening organizational governance and information disclosure to win the trust of clients, investors, and regulatory authorities, thereby securing long-term competitive advantages Gaining recognition and support from investors, clients, local communities, etc. in terms of ESG, leading to lower capital costs and the development of continuing relationships	Continuously strengthening and improving initiatives related to governance, compliance, and human rights Expanding corporate citizenship activities
Promoting human capital management	Decline in competitiveness due to inability to secure sufficient human resources amid shrinking populations Decline in service quality or operational suspensions due to on-site labor shortages	Promoting innovation and enhancing service quality through human resource development and the acquisition of outstanding human resources	Clarifying the human resources needed for management and business operations and securing a sufficient pool of diverse and outstanding human resources Maximizing the performance of individual employees by establishing good working environments and enriching training systems
Promoting digital transformation (DX)	Persistent high labor costs, etc. due to stagnant productivity Loss of business opportunities due to inefficient client data management Relatively inferior service quality or productivity attributable to falling behind other companies in DX Operational suspensions, decline in social credibility, or liability to provide compensation due to information security incidents	Enhancing competitiveness through operational streamlining, functional sophistication, and new value creation achieved via DX	Streamlining business operations and expanding/enhancing the value offered by the Company through DX of administration, sales, and on-site work Enabling expeditious and sophisticated management decision-making based on data (data-driven management) Developing organizations and human resources for DX promotion Preventing serious incidents by strengthening information security

Measures, KPIs, and Targets for New Material Issues

Materiality item	Corresponding basic policy(ies) of the Medium-Term Management Plan 2030	Initiatives	Measures	KPIs	Target values (for FY2029) *Certain exceptions may apply.
Promoting businesses that help solve social issues	Basic Policy ① Expanding/strengthening domestic core business shares Basic Policy ③ Business expansion in response to new logistics needs	Addressing energy-related issues	Developing and scaling up energy-related businesses (e.g., offshore wind power business, storage battery business)	Sales, number of cases handled, and other aspects of related businesses	(Not disclosed)
		Supporting client decarbonization efforts	Responding to transportation needs generated by client decarbonization efforts (e.g., steel industry decarbonization and modal shifts)	Sales, number of cases handled, and other aspects of related businesses	(Not disclosed)
		Promoting other businesses that help solve social issues	Developing and promoting businesses that help solve other social issues	To be set in accordance with progress on considering business issues	(To be set)
Contribution to carbon neutrality (CN)	Basic Policy ① Expanding/strengthening domestic core business shares	Reducing the Company’s own CO₂ emissions (Scopes 1 and 2)	Promoting environmental investment (LED lighting in warehouses, installing solar panels, adopting battery-powered forklifts, procurement of electricity from renewable energy sources)	Emissions reduction rate	−46%
Contribution to carbon neutrality (CN)		Reducing CO₂ emissions (Scope 3)	Responding to modal shifts	Sales and other aspects of related businesses	(Not disclosed)
Ensuring service safety and quality	Basic Policy ① Expanding/strengthening domestic core business shares Basic Policy ⑥ Operational streamlining and deliverable value enhancements/sophistication through DX	Accident prevention and mitigation in business	Establishing safety management systems	Number of serious accidents	Maintained at zero
			Sophisticating vehicle operation management/safe driving training	Number of traffic accidents	20% reduction (YoY)
			Improving working environments and promoting active communication	Number of workplace accidents	Frequency: 0.65 or lower
				Number of workplace accidents	Severity: 0.01 or lower
		Quality improvements	Initiatives to prevent quality-related incidents	Number of property damage accidents	20% reduction (YoY)
		Enhancing companywide resilience	Business Continuity Plan (BCP) development and drills for serious disasters	Completion of BCP formulation at all sites and implementation of drills for serious disasters at multiple sites	Implementation of drills for serious disasters (at least once a year at domestic business sites and major partner companies)
		Enhancing companywide resilience	Facility management adapted to disasters	Installation of emergency power supplies, etc. at each site	Percentage of installation at major sites: 15%
Sophisticating governance	Basic Policy ④ Transition to management control that supports portfolio-based management	Enhancing governance	Developing an optimal governance system	Review of organizational design	(Not disclosed)
		Enhancing governance	Enhancing information disclosure	Achieving and maintaining targeted rate of compliance with the Corporate Governance Code (CGC)	Maintained at 100%
		Enhancing compliance	Raising awareness of compliance among employees/preventing inappropriate behavior and interactions in corporate activities	Number of serious compliance violations	0 case
		Enhancing compliance		Disclosure of implementation results (compliance education)	(Not disclosed)
		Expanding corporate citizenship activities	Enhancing social contribution activities	Disclosure of implementation results	To be promoted continuously
		Respect for human rights in business	Implementing human rights due diligence	Disclosure of implementation results	To be promoted continuously
Promoting human capital management	Basic Policy ⑤ Implementation of companywide optimal human resource management	Respect for human rights and diversity	Actively promoting female officers and employees	Percentage of female officers and employees (excluding managers)	23%
			Actively promoting women to management positions	Women as a percentage of those in management positions	10% (FY2034)
			Developing a flexible working environment encompassing the established use of childcare leave for men	Percentage of men taking childcare leave	65% (FY2029) 85% (FY2034)
		Promoting health-oriented management	Encouraging use of paid vacation time	Rate of use of paid vacation time	73%
		Enhancing human resource development	Enriching training and development programs	Training hours per person	12 hours/year
		Securing outstanding human resources	Improving treatment and systems to increase and retain new graduate hires	Three-year retention rate of new employees	80% or higher
		Maximizing the value of human resources and organizational strengths	Clarifying the concept of ideal human resources	Visualizing the human resource portfolio	Clarifying and pursuing the ongoing management and review of skills, abilities, and headcounts according to the required roles
			Clarifying the required headcount by job type and rank	Visualizing the human resource portfolio
			Enhancing employee engagement through ongoing improvements in the working environment	Engagement score	A score of 70
Promoting digital transformation (DX)	Basic Policy ⑥ Operational streamlining and deliverable value enhancements/sophistication through DX	DX of administrative operations	Standardizing administrative work, improving work quality, and reducing costs	Progress on relevant measures	(Not disclosed)
		DX of sales operations	Streamlining sales work and creating new value by utilizing in-house data relating to business partners	Progress on relevant measures	(Not disclosed)
		DX of on-site operations	Streamlining operations and creating new value by accumulating on-site DX know-how	Progress on relevant measures	(Not disclosed)
		Data-driven management	Realizing expeditious and sophisticated management decision-making	Progress on relevant measures	(Not disclosed)
		Developing a promotion system	Developing organizations and human resources for companywide DX promotion	Progress on relevant measures	(Not disclosed)
		Enhancing information security	Promoting information security measures	Number of incidents (e.g., information leaks, service interruptions)	0 case

Promotion System

Under the oversight and instructions of the Board of Directors, the Sustainability Committee, chaired by the President and Representative Director, manages the progress of initiatives and reviews relevant measures as required.
The relevant initiatives will be disseminated and promoted on site through the Sustainability Subcommittees established for each materiality item and the Sustainability Liaison Committee composed of site managers as responsible persons.

Acompanywide subcommittee is established for each materiality item to monitor its progress and consider and formulate additional measures.

Promotion System

Board of Directors

Oversight/instructions

Agenda proposal/Reporting

Sustainability Committee

Chair: President & Representative Director
Members: Intemal Directors, Executive Officers, administrative section heads, and others
Observers: Outside experts and others (invited as necessary)
Secretariat: Corporate Sustainability Sect.

Instructing to study measures

Proposing measures to implement

Instructing to implement measures

Reporting on measure implementation status

(Sustainability)
Subcommittees

Chair: General managers of related sections
Members: Members from related sections and others, appointed by the chair
Secretariat: Corporate Sustainability Sect.

Proving information to contribute to proposals

Holding hearings on proposals

Sustainability Liaison Committee

Chair: President & Representative Director
Members in change of sustainability promotion: General managers of Group sites
Secretariat: Corporate Sustainability Sect.

Disseminates measures on site, monitors their implementation status, and identifies issues.

Acompanywide subcommittee is established for each materiality item to monitor its progress and consider and formulate additional measures.

Disseminates measures on site, monitors their implementation status, and identifies issues.

Former Materiality

Former Materiality (Initiatives and Results up to FY2024) pdf

（262kb）