Material Issue 6

Related SDGs

Basic Policy

In order to achieve sustainable business growth, it is important to create an environment where people involved can thrive. Foundation of a fair work environment is that everyone in the supply chain accepts diversity in terms of race, religion, ethnicity, nationality, gender and others, and respects human rights without discrimination. We must also respect work-life balance, valuing the lifestyle of each individual. In addition, there is a possibility that serious occupational accidents may occur in the forest business or in the housing and construction business, and sufficient measures need to be implemented to prevent such accidents.

The Sumitomo Forestry Group sets "We promote a free and open-minded corporate culture that respects diversity" as one of Our Values, and also make the Declaration on Health Management in an effort to maintain and improve the physical and mental health of all employees and their families so that they can work healthily and actively. In the future, with the utmost emphasis on continuous improvement of employee satisfaction, we will work on multi-faceted and concrete targets such as realization of diversity, prevention of harassment, elimination of occupational injuries, and improvement of our employee retention rate and the number of qualifications obtained by employees.

Impact on Society and the Environment

Management of Material Issue 6 (FY2025)

In the Mid-Term Sustainability Targets Phase 2 (2025 to 2027), Material Issue 6 is roughly divided into the following four categories and managed through the annual action policies and measures adopted by the department in charge.

Work-Life Balance (Workstyle Reform)

We regard the improvement of employees’ work-life balance, physical and mental health and work satisfaction as our management priorities. For fiscal 2025, the employee satisfaction rate was 81.0% (against the target of 80.0%) on a non-consolidated basis and was 67.2% (against the target of 64.6%) among subsidiaries of Sumitomo Forestry in Japan. We were thus able to exceed both the targets. In particular for the enhancement of psychological safety of employees, we provided all managers with training on it and exceeded the targets set for it by achieving 72.8% (vs. 63.0%) on a non-consolidated basis and 65.4% (vs. 56.2%) among the subsidiaries in Japan.

However, the absenteeism score, which is a health indicator and implies the difficulty in working caused by physical or mental disorders, was 2.91, and we were unable to achieve the target of 2.75. The presenteeism score, which implies lower work productivity due to illness, was 81.6 and slightly below the target of 82.4, while improving year on year. For the improvement of these indicators, we will improve the working environment (through line care training, post-stress check measures, and the recommendation of secondary health checks at each of our bases) and enhance employees’ self-care ability (through the expansion of e-learning content and the organization of events by using QOLism app.). We will thereby give even more support for employees’ physical and mental health management and provide them with even better working environments.

The number of overtime work hours was reduced by 14.5% relative to the fiscal 2017 level of 45.5 hours, and we have achieved the target for the first time since we set the target.
For the reduction of overtime work, the Housing Division notified each of its bases of their total monthly working hours on around the 20th of each month to give them cautions and encourage them to review their operations as necessary. In May, we started to hold a meeting between the branch manager and the head of the division when any employees of a branch of the division had worked more than the limit set based on the so-called 36 Agreement. At the Timber and Building Materials Division, the replacement of the core system had some impact on its operations and caused longer working hours, but improvements have been gradually made as the staff are getting accustomed to the new operations. The Environment and Resources Division increased its operational efficiency through workload leveling and reassignment. We will continue to work on the improvement of operational efficiency and work style reforms to help employees work in a healthier manner.

We are encouraging male employees to take childcare leave to participate more in childcare. The childcare leave take-up rate among male employees was 71.4% on a non-consolidated basis. It was 49.0% and below the target of 55.7% among Sumitomo Forestry’s subsidiaries in Japan.
Some employees did not take the leave as they were unable to make adjustments for it with other employees, and there were also some who chose not to take the leave as a result of discussing whether or not to take it at their household, although other staff of their departments encouraged them to take the leave. We will continue to hold a childcare seminar regularly and deal with employees who do not apply for the leave individually. We will thereby raise employees’ awareness of our system that supports their work and childcare and encourage more employees to take childcare leave. Also, to this end, we will help employees make adjustments earlier with other employees to take the leave and build an environment that allows them to take it more easily.

Results

Ratings in the table below
Achieved: ◯　Not achieved but improved year on year: △　Not achieved and declined year on year: ✕

*1The state in which a person finds it difficult to work because a physical or mental disorder causes them to be late for work, leave work early, be absent from work and/or take unpaid leave

*2The state in which a person goes to work while suffering from some disease or symptom, and their ability to perform work or productivity is impaired

*3Calculated as a percentage of the number of new graduate employees who joined the company between April and the following March and who will be with the company on April 1, three years later

*4Percentage of employees who answered either "absolutely" or "yes, if I have to choose" in employee satisfaction surveys

Diversity

The Sumitomo Forestry Group issued the Sumitomo Forestry Group DEI Declaration in April 2024, clarifying the significance of Diversity, Equity and Inclusion (DEI) with the aim of fostering an environment where all individuals are respected and accepted within organizations and society under fair conditions. In 2025, we launched the “DEI Forest” project to raise employees’ DEI awareness and understanding.

Moreover, we asked all Sumitomo Forestry Group employees to share their DEI measures and approach as “My DEI” and held a DEI forum 2025 and social gathering with the participation of employees who had shared “My DEI” and employees of the personnel departments of Group companies. We also created a video on DEI and established a book space called “Library on DEI” to raise employees’ DEI awareness even more.

For the empowerment of women, we achieved the targets for the ratios of women among new graduates and among all employees. We are thus making improvements year on year, except for the rate of female directors.
We provide female employees who are candidates for managers with annual female leader training. Also, as part of the information exchange meetings held jointly by housing manufacturers, we hold an interactive meeting for female managers and that for female engineers every year, thereby providing women working in the industry with an opportunity to share role models.

Results

Ratings in the table below
Achieved: ◯　Not achieved but improved year on year: △　Not achieved and declined year on year: ✕

*1Calculated based on the provisions set in the Act on the Promotion of Women’s Active Engagement in Professional Life (Act No. 64 of September 4, 2015). Those in a position of supervision or management are regarded as senior managers.

*2At Sumitomo Forestry, managers have been called “leaders” since the company reformed its HR system in 2024. At its subsidiaries in Japan, personnel in managerial positions excluding those in a position of supervision or management are called “managers.”

*3Calculated by adding the number of new graduate employees hired during the period from May of the previous year to March of the current year to the number of new graduates hired in April of the current year

Human Resources Development

Our non-consolidated training expenses per employee amounted to 173,400 yen (against the target of 140,000 yen) and training hours per employee totaled 25.6 hours (against the target of 21.0 hours), both substantially exceeding the targets.

Major factors contributing to the results include an increase in the number of participants following the expansion of self-development training and the provision of level-specific training in response to the revision of the personnel system. It is presumed that with the revision of the personnel system and the expansion of the external training attendance system, employees’ awareness of the training system and their motivation for autonomous learning have gradually risen. In addition, aiming to realize a free and open workplace culture, the Housing Division has continued to implement the Three-Star Project, and conducted psychological safety training for all managers.

Going forward, we will continue to ensure the provision of level-specific training and work to provide employees with more training opportunities by enhancing collaboration with each business division.

In order to increase employees’ environmental awareness and knowledge, the Sumitomo Forestry Group encourages them to take the Certification Test for Environmental Specialists (eco kentei). The take-up rate at Sumitomo Forestry on a non-consolidated basis was 76.4% for fiscal 2025, achieving the planned target of 73.0%.

In the ranking of companies for the number of employees who passed the certification test in fiscal 2025, we were ranked No. 1 in the category of companies with 300 or more employees, with 425 of our employees passing the test. Cohnan Kensetsu, a Sumitomo Forestry Group company, was also ranked No. 1 in the category of companies with fewer than 300 employees, with 49 employees passing the test. As a result, the entire Sumitomo Forestry Group is highly rated for its environmental awareness raising efforts.

In fiscal 2026, we will further promote the acquisition of the environmental specialist certification by employees by encouraging them to take the test via the intranet and during the internal ISO 14001-related environmental audits, and distributing relevant learning materials to departments with low acquisition rates. We aim to achieve 80.0% for the rate of employees who have passed the test in fiscal 2027. We will continuously work to raise employees’ environmental awareness and conduct business activities in consideration of the environment.

Results

Ratings in the table below
Achieved: ◯　Not achieved but improved year on year: △　Not achieved and declined year on year: ✕

Occupational Health and Safety

In fiscal 2025, occupational injuries (resulting in four or more days of lost worktime) occurred in each of our business fields. The number of serious incidents has not been decreasing, which implies that the measures taken in the past three years were not very effective.

Based on the results of the survey conducted on the actual status of operational safety in fiscal 2025, we created a manual for work in high places and work involving the use of rotating machinery. Going forward, we need to routinize compliance with the manual by on-site workers.
We deem it necessary to carry out risk assessments and improve the quality of the assessments, standardize safety education across the Group including partner companies, implement cross-organizational measures to reduce falls and “caught in machinery” incidents as priorities, share information about near-miss incidents, identify commuting incidents and raise employees’ safety awareness to prevent these incidents.
In and after fiscal 2026, the Quality and Occupational Safety Management Department will conduct safety inspections on the sites experiencing occupational injuries resulting in four or more days of lost worktime and check the effectiveness of the measures taken on-site to prevent the reoccurrence of similar incidents.

Results

Ratings in the table below
Achieved: ◯　Not achieved but improved year on year: △　Not achieved and declined year on year: ✕

*Occupational accident equivalent to a serious occupational injury in Japan’s occupational injury classification (four or more days of lost worktime)