Basic Policy on the Employment and Treatment of Employees

According to internationally accepted human rights norms, we shall of course respect equal opportunity and diversity as well as respect the human rights of all individuals, including women, children, indigenous people, minorities and vulnerable people in the employment and treatment of employees as stated in the Sumitomo Forestry Group Code of Conduct Guidebook. In its recruitment activities too, the Company emphasizes the ambition and volition of the applicant, and does not differentiate selection processes according to academic background or gender. At Group companies outside Japan, the employment of local staff is actively promoted, and talented personnel are employed and promoted to management positions, irrespective of race or gender.

As for the disciplinary punishment and dismissal of employees, if there has been a compliance violation, the employee will be dealt with appropriately in accordance with Employment Regulations. Unfair dismissals are not allowed.

Recently, talent acquisition has been recognized as one of the major management issue for management in Japan triggered mainly by low birth rate and thereby aging population. Sumitomo Forestry communicates its employment and benefit policies with potential employees during recruitment and expands supportive programs to foster diverse work styles and performance of female employees in effort of acquiring valuable, next-generation talent.

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Promotion System

The Workstyle Diversification Department, which was established as an independent organization in the Personnel Department in April 2013, supports the utilization of a wide range of employees from female staff to re-employed retirees and employees with disabilities as well as promotes diversity.

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Promoting the Active Involvement of Female Employees

Ratio of Female employees in management positions 2020 targets (non-consolidated)
At least 5%

Ratio of Female employees in management positions as of March 31, 2018
(non-consolidated)
3.2%

The Sumitomo Forestry Group is committed to a workplace environment where motivated employees can be actively involved irrespective of gender, age, nationality, race, religion or disability. In an endeavor to actively engage female employees in particular, the Group has sought to improve its systems relating to childcare, education and training, and at the same time, has taken a proactive stance on promoting the use of these systems.

During fiscal 2013, the Group surveyed the attitude and needs of employees with respect to: work and careers; promoting the active involvement of female employees; and childbirth and parenting. A survey was conducted to gauge the awareness of all female employees at Sumitomo Forestry to assist the Group in promoting the active involvement of female employees and in supporting the workstyles of employees currently raising children. In December 2013, the Group released the “Sumitomo Forestry Group Declaration on Empowering Women.” It was issued to the entire Group under the name of the President, and formally summarizes the significance of promoting the active involvement of female employees into three policies. The Group is actively engaged in activities under the policy described in the Declaration.

In December 2014, numerical targets for the appointment of women to managerial posts have been set in order to foster further empowerment of female employees at Sumitomo Forestry. We have publicly announced our goal of raising the ratio of female managers to at least 5% by 2020 (3.2% as of March 31, 2018), and are working to achieve this goal. In fiscal 2016, in accordance with The Act on Promotion of Women's Participation and Advancement in the Workplace of the Japanese Government, the Company’s first phase action plan (April 1, 2016 to March 31, 2019) was implemented and has been available to the public.

Sumitomo Forestry has been conducting a mentoring system for the purpose of encouraging growth for the active participation of female employees as management since fiscal 2016. The mentoring system is a program where assigned mentors periodically interview mentees to support the growth of the mentee. In fiscal 2017, six female manger and manager candidates mentees where mentored by male managers in positions of general manager or above with the aim to further success and self-reformation.

Employment and Promotion of Women (Non-Consolidated)

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Female employees including contract employees*1 (%) 17.8 18.8 19.4 20.0 20.4
Female employees in management positions*1 (%) 1.9 2.2 2.6 2.8 3.2
Female new graduates*2 (%) 23.8 29.0 26.8 22.8 18.0

*1 The ratio of female employees and the ratio of female employees in management roles is a retrospective calculation based on the number of employees as of March 31 each year.

*2 The ratio of new female graduates is calculated based on the number of employees as of April 1 each year.

Employment and Promotion of Women (Subsidiaries in Japan)

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Female employees including contract employees (%) 29.5 29.6 30.4 30.7 31.6
Female employees in management positions (%) 3.2 3.6 4.0 4.2 4.6
Female new graduates (%) 36.5 36.1 48.0 40.3 40.2

Development and Sales from a Woman’s Perspective

Having started in March 2013, Women’s Perspective Project which gathered diverse female employees from the headquarters, branch offices across Japan, and Group companies in intention to bring homes designed from their residents’ perspectives. Previously, the project provided the “comama” spatial design proposal and also nine houses built and sold in just half a year at East Hills Seya in the Ikoma district in Nara Prefecture.

In addition, the brush-up customer service training from a woman’s perspective is continually held for female home advisors in each sales office and branch. This training is held for the purpose of making proposals after understanding Sumitomo Forestry products which utilize the perspective of women as well as building trusting relationships with customers after understanding the current concerns and dreams from a woman’s perspective through an open dialogue. In fiscal 2017, 152 female employees took this training program.

Main Initiatives Aimed at Increasing the Motivation of Female Employees

Sumitomo Forestry provides various training for female employees.

The training for women salespersons in fiscal 2017 was held with the purpose of teaching a practical level of the necessary skills and abilities to make proposals to improve the first contact with customers. The education also helped enhance knowledge and motivation by sharing information beyond area and generation.

The production training for female employees provided an informational exchange with other companies in the same industry as well as construction site tours for female on-site managers with the goal of teaching successful examples of construction engineers who are women outside Sumitomo Forestry as well as improving skills and motivation.

Main Initiatives Aimed at Increasing the Motivation of Female Employees

Eligible Persons Description Date Number of Participants
Sales Staff Female Sales Staff Training December 2017 52
Networking Event for Female Housing Sales Staff: Joint Program by Nine Housing Builders November 2017 6
Production Staff Production Training for Female Employees January 2018 10
Managers and Manager Candidates Mentoring Program July 2017
to June 2018
6
Management External Management Leadership Training October 2017
to May 2018
2

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Promoting the Employment of Persons with Disabilities

Ratio of Disabled Employees
As of March 31, 2018
(Non-consolidated)
2.26%

Sumitomo Forestry promotes the employment of people with disabilities, giving the highest priority to matching the individuality of each person with a disability with the workplace and business activities. The ratio of disabled employees as of end March, 2018 was 2.26%. Furthermore, to improve the retention rates for current employees, the Company provides regular face-to-face meetings as well as phone interviews and career advice as required.

Employment of Persons with Disabilities (Non-Consolidated)

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Ratio of Disabled Employees (%) 2.18 2.24 2.12 2.12 2.26

* The calculation includes the subsidiary Sumirin Wood Peace Co., Ltd. for fiscal 2017.

Promoting Proactive Employment of Persons with Disabilities –Sumirin Wood Piece Founded

Aiming to provide employment opportunities for persons with disabilities, the Company in July 2015 founded a subsidiary in Niihama, Ehime Prefecture in Japan with business lines such as shiitake mushroom farming, wooden products manufacturing, processing, and printing. The Sumitomo Forestry Group hired five persons who have intellectual and psychological disabilities in October 2016. In March 2017, a new office building was completed and in April the Sumirin Wood Piece obtained the certification of a special subsidiary company in accordance with the Act for Promotion of Employment of Persons with Disabilities.

Exterior of new Sumirin Wood Piece Office Building

Exterior of new Sumirin Wood Piece Office Building

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Re-Employment of Retirees

Sumitomo Forestry has a system in place whereby it re-employs personnel, who retired at 60, on temporary contracts until they turn 65, on the condition that they have had at least 10 years of continuous service, they have specific qualifications and experience, and they wish to be re-employed. The Company re-employed 50 people in fiscal 2017. They are all actively involved in the Company, making the most of their abilities and experience.

Over the past three years, Sumitomo Forestry has re-employed 83.3% of employees who retired. As an interim measure following revision of the Act on Stabilization of Employment of Elderly Persons on April 1, 2013, the Company re-employs all workers who wish to return to work.

Number of Re-Employed Retirees

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
28 43 34 46 50

In addition, “senior human resource asset bank center” system began operations in April 2018 to utilize human resources over the age of 65 who are necessary to the company and would like to keep working with the purpose of actively using human assets regardless of age.

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Return to Work Application System

Sumitomo Forestry has operated the Return to Work Application System since fiscal 2008. The aims of the system are to meet the re-employment needs of workers to secure talented personnel who resign due to unavoidable circumstances such as childcare and eldercare. Employees register their wish to return to work at the time they resign, and applicants must have had worked for at least three consecutive years before the resignation. As of the end of March 2018, the Company received 157 applications.

When the Company receives an application, it goes through a selection process based on the Company’s needs and the skills of the applicant. Applicants who are successfully re-employed within three years of the resignation are able to regain the same levels of position as before.

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Direct Employment of Non-Permanent Employees

In recent years, regulations for dispatched employees have been strengthened to correct disparities arising out of different forms of employment. In response, Sumitomo Forestry reviewed its personnel systems to appoint competent employees, and in April 2011, changed the status of its dispatched employees to directly employed fixed-term employees, referred to as “partner employees.” Sumitomo Forestry also operates a system for promoting partner employees to permanent status. It promoted 19 workers to permanent employee status in fiscal 2015, 14 in fiscal 2016, 19 in fiscal 2017 and 12 in fiscal 2018.

Number of Partner Employees Promoted to a Permanent Employee

FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
28 19 14 19 12

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