Materiality

Materiality Identification Process

1. Step1

   Organize social issues

   • List social issues making reference to the SDGs and other frameworks
   • Identify the social issues relevant to the Calbee Group

2. Step2

   Create a materiality map

   • Evaluate the importance of said social issues and create a materiality map
   • Make a materiality proposal based on the materiality map

3. Step3

   Verify suitability

   • Hold workshops to incorporate internal opinions
   • Carry out interviews with external experts

4. Step4

   Final identification of materiality

   • Perform final identification of materiality based on internal and expert opinions

Materiality Map

Sustainability Management Promotion Framework

In December 2019, we established a Sustainability Committee including an external expert as advisor. The Sustainability Committee determines the Calbee Group’s materiality, discusses and reviews the roadmap for the priority themes promoted by the subcommittees, and reviews the status of progress on them. The results of these activities are regularly reported to the Board of Directors.

Priority Themes and Major Measures Based on Materiality

Category	Materiality	Priority themes and major measures	Targets (KPIs)	FY2021/3 results	Correspondence with the SDGs
Contributions through products	1 Assurance of food safety	Prevention and monitoring for safety and quality Initiatives for security Product improvements reflecting customer feedback	-	-
	2 Response to health conscious and diversifying lifestyles	Provision of health-conscious products Gradually reduce amount of salt in products Expand sales ratio of protein-rich products	FY2024/3 Amount of salt equivalent in products sold*1 20% reduction(vs.FY2019/3) Sales ratio of protein-rich products*2 10%	Amount of salt equivalent in products sold 5.4% reduction Sales ratio of protein-rich products 4.8%
Contributions through the supply chain	3 Progress of sustainable agriculture 4 Ensuring the sustainability of raw materials and logistics with improved efficiency	Sustainable, environmentally conscious procurement: Stable procurement of potatoes Promote development of potato varieties and scientific cultivation Reduce agricultural labor Disperse production areas and diversify suppliers	FY2024/3 Domestic procurement volume of potatoes 400,000 tons (up 20% vs. FY2019/3)	Domestic procurement volume of potatoes 342,000 tons
		Sustainable, environmentally conscious procurement: Use of certified palm oil Bidding for and purchasing credits through Book & Claim (B&C) Promote initiatives to encourage use of Mass Balance Certification Mark	CY2030 100% use of certified palm oil	May 2020: Purchasing credits through Book & Claim (B&C) July 2021: Began purchase of Mass Balance certified palm oil
Contribution to the global environment and local communities	5 Caring for the earth	Reduction of greenhouse gas emissions Reduce Scope 1 and Scope 2 emissions Switch electricity suppliers, energy-saving activities, on-site generation at plants, etc. Reduce Scope 3 emissions Change carton sizes, reduce delivery frequency, improve loading efficiency	CY2030 Total greenhouse gas emissions: 30% reduction (vs. FY2019/3)	Total greenhouse gas emissions　0.6% increase Scope1：2.3% reduction Scope2：17.3% reduction Scope3：4.7% increase
		Protection of resources and realization of a recycling society Reduce product food losses Reduce water consumption Promote 3Rs	FY2024/3 Product food loss 20% reduction (vs. FY2019/3) CY2030 Total water consumption 10% reduction (vs. FY2019/3) Total waste generated 10% reduction (vs. FY2019/3)	Product food loss　74% increase Total water consumption　6.5% increase Waste reduction amount　4.3% reduction
		Replacement and reduction of plastic package Reduce petroleum-based plastic package Switch to alternative materials and promote recycling	CY2030 Environmentally considerate material use 50% CY2050 Environmentally considerate material use 100%	Capital participation in R Plus Japan, Ltd.
	6 Foster deeper connections with people, local societies, and communities	Invigoration of food communications Expand Calbee Snack School (food education) Invigorate and promote factory tours	FY2024/3 Food communications Number of participants*3 400,000 (5 years cumulative)	Food communications 107,714 participants
		Contributions to local societies Expand activities in the environmental domain Strengthen activities in the health domain	-	-
Establishment of management base	7 Promote active roles for all employees based on diversity	Promote diversity and inclusion Strengthening of human resource development Workstyle transformation	FY2024/3 Ratio of female managers Over 30% Ratio of male employees taking childcare leave 100% Rate of employment of people with disabilities 2.5%	Ratio of female managers 21.8%（As of April 2021） Ratio of male employees taking childcare leave 26.5% Rate of employment of people with disabilities 2.58%
	8 Enhance corporate governance	Establishment of corporate governance organizations and frameworks Bolster compliance and risk management Respect for human rights of stakeholders	-	-

• Product food loss reduction targets and results are for domestic Calbee Group companies excluding Potato Kaitsuka Ltd. Targets and results for reduction of greenhouses gases are for factories operated by Calbee, Inc., and Obihiro factory of Calbee Potato, Inc. All other indices are for Calbee Inc.
• *1 Salt content of all products sold as a percentage of the total weight of products sold
• *2 13% or more of total energy consumption accounts for protein
• *3 Food education activities such as Calbee Snack School and factory tours

Comments from Experts in Identifying Materiality

In order to verify the appropriateness of our materiality from external perspectives, we carried out interviews with three experts based on their expertise. We have finally identified the materiality in consideration of their opinions.

Makiko Akabane
Director Japan, CSR Asia

At present, “Access to Nutrition” is a social issue that is frequently discussed in global food companies.

There are two issues: excessive nutrition causes increases in obesity and adult illness, and the difficulty of accessing nutritious foods causes poor nutrition.

Calbee Group's materiality includes "Response to health conscious and diversifying lifestyles." I think highly of this in terms of the materiality based on Calbee Group's business contributions. The Calbee Group inherit their founding philosophy of offering safe products that benefit health by leveraging the quality of food resources. I believe this materiality leads to resolve the social issue of "Access to Nutrition," which is attracting increasing global attention.

I expect that Calbee will continue to work proactively to resolve social issues in their own ways while expanding their overseas business.

Minako Oishi
Vice Chairperson, NIPPON ASSOCIATION OF CONSUMER SPECIALISTS

Sustainable product selection begins with knowing the life of a product, from raw material procurement to manufacturing, distribution, disposal, and recycling.

There is a steadily increasing number of consumers who want to select products from an environmental and ethical perspective, such as what types of energy manufacturer use and whether manufacturer protect working environment throughout the supply chain.

In Calbee Group's business activities, consumers are increasingly interested in procuring certified palm oil, using renewable energy, and reducing the use of plastic containers.

To eat is to live, so it is the basis of body and spiritual richness.

In this sense, I feel that Calbee Group is always in close to us, consumers and has responded to the needs of the times.

I expect that the Calbee Group take the initiative in addressing environmental and social issues throughout the supply chain. At the same time, we will proactively communicate the thought of "life of products" and deepen communication with consumers in order to create a sustainable food future together.

Mariko Kawaguchi
Professor, Rikkyo University

I believe the identification of "Progress of sustainable agriculture" as a materiality is considered to be the foundation of Calbee Group's future management, a company that values the gift of nature and the power of nature.

While agriculture is significantly affected by climate change and biodiversity, greenhouse gas emissions and land transformation have a major impact on the global environment.

In considering food sustainability, food loss reduction, which is estimated to be 30% of food consumption, is an urgent issue.

Going forward, I expect that Calbee will accelerate their efforts for food ross reduction.

In correspond to the COVID-19 pandemic, we need to consider not only BCPs (Business Continuity Plans/ Business Continuity Plan) based on the current business environment, but also the possibility of further significant changes in the business environment and social importance surrounding the company, such as changes in people's work style, health awareness and purchasing preferences.

At a time when the medium-to long-term impact of the COVID-19 pandemic will be visible, it would be better to reexamine the materiality and the priority themes.