Policies and Results

Focusing on four areas of activities revolving around three pillars

In fiscal 2005, OMRON designated three pillars of CSR policy: (1) Contribute to a better society through business operations; (2) Always demonstrate fairness and integrity in the promotion of corporate activities; and (3) Show a commitment to addressing societal issues as a concerned party. Based on this policy, four focus areas were determined to cover the GD2010 second stage (fiscal 2005-07). These are: (1) Promoting innovation driven by social needs through business operations; (2) Strengthening legal compliance and corporate ethics; (3) Addressing diversity issues; and (4) Commitment to environmental conservation.

These pillars and focus areas of CSR activities were also maintained for the determination of fiscal 2006 policy and implementation of activities. The following table shows major CSR activities carried out during fiscal 2006 and the policy for fiscal 2007.

Corresponds to focus areas.

1. Contribute to a better society through business operations

	Innovation driven by social needs
Basic policy	Offer products and services to address social needs related to safety, security, environmental conservation and health, by capitalizing on OMRON's core competencies of Sensing and Control technology. The key concept is creating the 'best matching of machines to people'.
FY2006 policy	Develop technologies, products and services in accordance with the basic policy.
FY2006 results	Strengthened solutions business to address security issues of the manufacturing industry. Offered a system to improve quality management and traceability of food production sites. Offered an energy management system capable of contributing to energy conservation through visualization of electricity consumption. Supplied control equipment for solar power systems.
FY2007 policy	Continue to develop products and services that solve issues related to safety, security, environmental conservation and healthcare.

	Universal design
Basic policy	Pursue Universal Design from the standpoint of allowing machines to adapt to the individual needs of various users.
FY2006 policy	Develop Universal Design products in accordance with the basic policy. In particular, incorporate the results of evaluation using the Universal Design indicators into new products.
FY2006 results	Developed more easy-to-use products incorporating customer feedback through the evaluation of blood pressure monitors and other healthcare devices. Consumer monitors and visits to customers' homes were used to survey usage conditions.
FY2007 policy	Develop Universal Design products in accordance with the basic policy.

2. Always demonstrate fairness and integrity in the promotion of corporate activities

	Corporate governance
Basic policy	Create an optimal management system and build/implement a monitoring system that attests to the effectiveness of corporate operations to enhance competitiveness. The eventual goal is to ensure sustainable growth of the company by gaining the trust and confidence of stakeholders.
FY2006 policy	Instill the OMRON Principles to assure that they are thoroughly practiced by all OMRON Group organizations and employees at the global level. Set up the Information Disclosure Committee to monitor information disclosure of the OMRON Group as a whole.
FY2006 results	Established new and updated corporate principles and announced corporate core value of 'working for the benefit of society' internally and externally. Translated 'The OMRON Principles' booklet into 25 languages and distributed in each region to instill the new corporate principles. Formulated voluntary information disclosure policy/standards and set up an Information Disclosure Committee. Reduced term of directors and set up a President Nomination Advisory Committee to strengthen corporate governance.
FY2007 policy	Promote implementation and instillation of the OMRON Principles at the global level. Strengthen sharing and instillation of the OMRON Principles for overseas Group companies as well as those recently joined.

	Compliance & corporate ethics
Basic policy	Place the highest priority on corporate ethics as a responsible corporate citizen. Assure strict maintenance of fairness and integrity in all corporate activities and in the behavior of all employees.
FY2006 policy	Strengthen global promotion system to thoroughly disseminate the Corporate Ethics Guidelines. Encourage Group companies in Japan to implement autonomous PDCA cycle for promotion of compliance and ethical actions. Publish a case study guidebook including more practical guidance for action and appropriate criteria for judgment for each specific case.
FY2006 results	Reviewed OMRON Corporate Ethics Guidelines and issued CSR Practice Guidelines to more comprehensively cover areas related to implementation of CSR demanded by global society. Distributed the above guidelines to all employees in Japan and conducted discussions at each worksite. Assigned a corporate ethics officer at Group company in China. Conducted compliance monitoring at 11 sites in and out of Japan to encourage implementation of PDCA cycle. Gathered and compiled corporate ethics/compliance-related cases in preparation of the publication of case study guidebook.
FY2007 policy	Publish CSR Practice Guidelines in each region of the world. Establish a global-scale PDCA cycle implementation system for compliance. Publish a case study guidebook.

3. Show a commitment to addressing societal issues as a concerned party

	Labor & diversity
Basic policy	Employee motivation and fair remuneration Motivate employees to fully demonstrate their talents and support them in achieving their individual goals. Stimulate the development of employees and the company itself through fair evaluation and remuneration based on employee performance and achievements.
	Respect for diversity Promote talented people to vital positions in the workplace regardless of gender, race, religion, or other non-performance related attributes and encourage them to reach their full potential.
	Enhance awareness of human rights in the workplace Strive to raise employee consciousness of human rights and create a workplace that values individuals, while working to build a pleasant society free from discrimination.
FY2006 policy	Promote implementation of Specialists System. Continue to expand the scope of specialists' qualification and extend the system to cover Group companies.
	Promote the employment of people with disabilities in a well-planned way to achieve the goal of 2.3% in Group-wide employment of people with disabilities in Japan by the end of FY2007. Continue female leader training and improve the training program. Improve working conditions, such as through the provision of daycare centers to help employees achieve work/personal life balance.
	Promote awareness of human rights among employees along with instillation of the OMRON Principles. - Promote awareness of human rights among employees along with instillation of the OMRON Principles. - Improve awareness-enhancing system of Group companies.
FY2006 results	Nine new specialists were qualified, including one for a new job category added in FY2005, resulting in 43 qualified specialists for the entire Group. Continued to study expansion of job categories for specialist qualifications and system coverage of Group companies, but no new job categories were added or new specialists qualified at companies other than OMRON Corp.
	Increased Group-wide percentage of employees with disabilities in Japan to 2.04% from 1.78%. Promoted employment of disabled persons in China, showing steady advancements in various Group companies. Continued female leader training and qualified one woman as a specialist at OMRON Corp. Opened a daycare center near the Keihanna Technology Innovation Center for enhanced work/personal life balance for employees. Improved employee support initiative by extending period for shorter working hours for childcare and initiating periodical interviews by managers.
	Adopted human rights as a topic of discussions conducted at each worksite as part of the instillation of the OMRON Principles. Conducted training for persons in charge of human rights awareness enhancement in Japan with 36 persons from 30 Group companies participating.
FY2007 policy	Promote implementation of Specialists System and study expansion of job categories for specialist qualification. Introduce implementation of the OMRON Principles as personnel appraisal criteria for managerial-level staff.
	Aim to increase Group-wide percentage of disabled employees in Japan to 2.3% by the end of FY2007. Continue female leader training and improve training program. Support employees in achieving work/personal life balance by opening a daycare center in Kyoto.
	Continue enhancing human rights awareness in alignment with programs to instill the OMRON Principles. Strengthen efforts to prevent sexual harassment in accordance with the revised Equal Employment Opportunity Act.

	Supply chain management
Basic policy	Build a robust, global partnership with suppliers and associates who cooperate in creating reliable products, ensuring that purchasing is conducted in a fair and open way. Also share OMRON's CSR policy and awareness with suppliers so as to involve them in promotion of CSR practices.
FY2006 policy	Present and share purchasing policies including CSR considerations with suppliers. Add CSR items to basic supplier contracts as provisions requiring strict conformance and apply at the global level. Consider monitoring suppliers to help them strengthen CSR activities.
FY2006 results	Revised purchasing polices to include new provisions of environmental conservation and legal compliance. Presented new purchasing policies to suppliers and requested their cooperation in CSR procurement. Negotiated contracts including CSR provisions with 136 suppliers in China and concluded new contracts with 75% of them. Studied monitoring process to check suppliers' status of CSR activities.
FY2007 policy	Build a system for effective CSR procurement.

	Community involvement
Basic policy	Strive to help people with disabilities or other limitations to enhance the quality of their lives and build a society that allows them to be self-reliant while fully developing their personal strengths.
FY2006 policy	Develop new support programs to improve QOL of people with limitations.
FY2006 results	Supported building of Kyoto recruitment agency network to promote employment of disabled persons. Approx. 8,400 employees worldwide participated in Founder's Day volunteer activities. Launched 'Ecovolun' initiative (see pg. 41) on a trial basis to support employees' volunteer activities.
FY2007 policy	Develop an employment support program for disabled people in conformance with the drive to improve QOL for people with limitations.

	Environmental conservation
Basic policy	OMRON believes that addressing environmental issues is one of its most important corporate responsibilities. Based on this, strive to reduce the environmental impact of business activities, while creating environmentally sound products and technologies.
FY2006 policy	Continue offering environmentally warranted products free from hazardous substances. Strengthen measures to reduce CO2 emissions at overseas sites. Achieve zero emissions at all non-production sites in Japan. Conduct global environmental auditing.
FY2006 results	Continued total elimination of hazardous substances from products. CO2 emissions increased 6.7% compared to FY2005 due to increased production; emissions per unit of production decreased 28.7%. Zero emissions were not achieved at some sites; achievement expected by FY2007. Conducted corporate environmental audits (internal audits) for two production sites in China.
FY2007 policy	Continue efforts to meet hazardous substance regulations on products. Continue strengthening measures to reduce CO2 emissions at overseas sites. Expand zero emissions sites. Strengthen environmental risk management at the global level.

Management-related issues

	Dialogue with stakeholders
Basic policy	Engage and communicate with stakeholders and listen to their views while implementing stakeholder-centered management. The eventual goal is to plan and implement corporate strategies and programs jointly with stakeholders.
FY2006 policy	Reflect recommendations given by dialogue participants in future activities. Expand and continue dialogues with stakeholders.
FY2006 results	Continued dialogue with Kyoto CSR Workshop. Conducted dialogue to exchange views between GLN Research Team and CSR managers from all the business companies.
FY2007 policy	Reflect recommendations given by dialogue participants in future activities. Aim for expanded dialogue opportunities with more diversified stakeholders.