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CSR Management System of SG Holdings Group

Basic idea of CSR (Corporate Social Responsibility)

Fulfilling CSR means the capability to adapt to the more sophisticated and diversified requirements and expectations from society to obtain trust for our companies. In our group's CSR concept, there are 2 levels: "Basic CSR" and "Advanced CSR". Basic CSR is the essential factors for continuing business operations, such as the compliance with laws. On top of this, Advanced CSR is in place to answer the emerging expectations and requirements from various societies and to contribute to them. Our CSR is supported by these two levels.

Promoting CSR system

With the goal of contributing toward achievement of a sustainable society, the SG Holdings Group has put forth as its corporate policy fair and free corporate activities with respect for human rights and compliance with the law.
We make the SG Holdings Group Conduct Charter known throughout society by communicating it to the public, and in order to transform the Charter's principles into actions, its ideas are put into practice among all group directors and employees through the SG Holdings Group Code of Ethics and Conduct.
The purpose of the CSR Committee*1 is to construct a checking system and promote continuous improvement activities for putting SG Holdings Group's Conduct Charter in practice and reflecting on the management of the whole group. Support has been given for ISO 26000 (global standards and guidelines for social responsibility), issued in 2010, and other changes have occurred in recent years concerning CSR, resulting in increased interest in CSR within Japan and abroad. In light of this, our CSR Committee held a review of the basic policies on the internal control system*2, the Conduct Charter and the Code of Ethics and Conduct, and carried out revisions (Enforcement: FY2011).
In order to realize the stakeholder-oriented management (for customers, employees, local communities, stakeholders and business partners) laid out in the "Second Stage Plan" (FY 2010 - 2012) of the medium-term management plan, CSR activities are carried out to raise awareness among employees.

  • *1 The CSR Committee consists of all the board members of SG Holdings Co., Ltd.
  • *2 The basic policies on the internal control system were revised on January 21, 2011.

Basic policies on the internal control system (excerpt)

In response to changes in the social and business environments, we recognize of the need for further strengthening of compliance efforts and clarification of policies for preventing damage from antisocial forces and groups. Therefore, we reevaluated the SG Holdings Group's basic internal control policies and made revisions as necessary.

[Note: The following is from a section on compliance and risk management (excerpt)]

Framework to ensure compliance with laws and articles of association in the execution of duties by directors and employees

  • Directors and employees shall, in compliance with laws and articles of association, do the following in order to cultivate and maintain ethical standards and ensure a workplace conducive to business operations:
    1. Hold CSR Committee meetings and make continual changes to the compliance framework
    2. Based on the group's Conduct Charter, and in compliance with applicable laws and the articles of association, business activities shall be carried out in while maintaining high ethical standards
    3. The group's Code of Ethics and Conduct shall be utilized as the code of conduct for directors and employees
  • With the purpose of early discovery and prevention of illegal activities and other misconduct, the group shall establish the "General Consultation Room" internal reporting (whistle-blowing) system. Based on the Regulations for Protection of Whistle-Blowers, from the viewpoint of protecting informants who serve the public good, a structure facilitating collection of information, informing (whistle-blowing) and consultation shall be maintained and developed through timely and suitable changes and improvement measures as necessary.
  • Based on awareness that the elimination of antisocial forces and groups that threaten public order and peace is a matter of common public interest, as a corporation with social responsibilities, we establish the following basic policies toward antisocial forces and groups, and maintain the proper corporate framework to effectively enact such policies:
    1. We confront antisocial forces and groups in a determined manner, and take every measure to prevent relations with them
    2. We do not respond to unjust demands from antisocial forces and groups, and refuse engagement in secret trade/business or provision of capital to said forces/groups
    3. We work with specialized external organizations in response to antisocial forces and groups, and take systematic and lawful measures to ensure the safety of directors and employees as top priority

Regulations and framework for management of risk related to damage and loss

  • All forms of business risk, including risk related to corporate strategy, business activities and financial reporting shall be controlled in order to prevent them, based on the Risk Management Regulations.
  • In the case that a situation occurs in which significant damage may be incurred to corporate management, business practices, or the corporate image, or in the case of a situation in which society as a whole may be strongly affected, a suitable response shall be taken according to the Crisis Management Guidelines and the Disaster Management Guidelines.
  • "Risk Management Meetings" shall be held as required, with the purpose of preventing and minimizing the occurrence of risk as well as minimizing damage or loss, in order to strengthen the risk management framework.

Application of the corporate philosophy, strengthening of the compliance framework, adjustment of the risk management framework

At the SG Holdings Group, we are aware that management of the compliance checking system for the SG Holdings Group Code of Ethics and Conduct, as well as the group's risk management framework which enables all group companies to grasp, evaluate and manage risk in their business activities, are both important pillars supporting the network of internal controls, and we make efforts to operate each system as such.
On January 17, 2011, a former employee of Sagawa Express was arrested on suspicion of embezzlement. The individual was discovered during an internal investigation at the company, and in November 2011 was criminally prosecuted, resulting in the embezzlement incident's coming to light. In this case, the former employee had misappropriated funds received from payment-on-delivery services in order to pay back loans, and in June 2010 the individual was discharged from the company for disciplinary reasons.
We responded to this incident with solemn reflection, and in addition to reexamining procedures for receipt of cash and making efforts to deepen compliance education among employees, we have vowed to implement thoroughgoing measures to prevent reoccurrence of such an incident.
In FY 2010, SG Holdings Group constructed risk management frameworks for each group company through our risk management website, and in FY 2011 we began adjustment of the of the group management network as a whole. We are also implementing education initiatives for all group employees with the aim of strengthening the compliance framework further.

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