Masaru Kosuge, Executive Officer of Sakai Chemical Industry
When Sakai Chemical Industry was founded in Sakai, Osaka in 1918, lead oxide poisoning was widespread in Japan. The company’s founder, Ginjiro Tanaka, managed to successfully manufacture zinc oxide as a substitute for lead, and started selling it as a cosmetic ingredient. Since then, the company has led the industry for more than 100 years by manufacturing and selling a wide variety of chemical products. These include titanium dioxide, the base for white pigments, barium, which is used in the medical field, catalysts, and electronic materials.
Sakai Chemical Industry started partnering with EcoVadis in 2020. Its Sakai Manufacturing Site and Onahama Manufacturing Site located in Fukushima Prefecture both received Gold Medals, placing them in the top 5% of companies. We interviewed Executive Officer Masaru Kosuge to learn how the company has been advancing its sustainability efforts.
What is your company's approach to sustainability?
As we develop and manufacture chemical products, we continuously work to ensure that environment, safety, and health are an essential part of our business. We belong to the Responsible Care committee, a subcommittee of the Japan Chemical Industry Association, and are also working to establish an environmental management system (EMS) based on ISO 14001,the internationally recognized standard for EMS.
In response to the growing global interest in sustainability and Sustainable Development Goals (SDGs), we have also established key goals that we prioritize. The four goals are spreading joy, protecting the global environment, solving societal issues through manufacturing, and building a transparent and strong management system.
To realize these goals, we established an internal sustainability committee in September 2021. We set up environmental and other KPIs for each item and have engaged the entire company in this effort. We share and discuss results at meetings attended by the president, directors, executive officers, and other relevant parties. Every year we create and publish reports that summarize the outcomes of our initiatives.
What was the impetus for your decision to undergo the EcoVadis assessment?
When we started doing business with a Western optical products manufacturer, they asked us to complete the EcoVadis assessment. Since the company had significant expertise in sustainability, we felt confident that the EcoVadis assessment had global credibility, so we decided to move ahead with it.
In order to complete the assessment, we first had to understand the operations of each of our offices. This meant we needed to ask the relevant departments to provide us with specific data.
Even before we started working with EcoVadis, our manufacturing sites had been prioritizing safety through accident prevention. For the assessment, the management team began by communicating the significance of receiving a sustainability rating and disseminating the results. Members of the General Affairs department visited the sites many times to build a relationship with the employees while deepening their understanding of sustainability.
(Headquarters and Sakai Manufacturing Plant, in Sakai, Osaka Prefecture)
In 2021 and 2022, both the Sakai and Onahama sites received Gold Medals. In 2023, the Sakai site received the Silver Medal while the Onahama site received a Gold Medal again. Can you talk a bit about that?
Receiving such a high rating in our first assessment was proof once again that our daily efforts did not go unnoticed. Although the Sakai site received a Silver Medal in 2023, we believe our efforts remained consistently high since our score stayed the same.
While it wouldn’t be right to improve our internal initiatives with the sole goal of obtaining a higher EcoVadis Rating, we would like our employees to find confidence in the fact that our efforts so far have received a certain level of recognition from a third party.
Externally, getting EcoVadis assessment and sharing the scorecards with stakeholders has become one way to communicate that we are committed to sustainability with integrity. We have also received an increasing number of requests from potential customers to share our EcoVadis scorecards. Some of the world's leading cosmetics companies have reached out to us as a result, and we see firsthand the growing awareness of supply chain sustainability, especially in Europe and the U.S. We expect that EcoVadis assessments will be meaningful for materials manufacturers such as us, not only for sales, but also for investor relations.
(Solar power system installed via PPA at the Onahama Manufacturing Site’s Daiken Plant)
How were you able to receive such high scores?
We always get this question from our competitors when they learn of our rating. However, we did not do anything extraordinary in order to obtain a high score. We just detailed our initiatives as they are and were rated accordingly. We do not intend to change the way we conduct our business just to receive a high score.
However, the questions in the EcoVadis assessment are updated year by year in line with global trends. In answering these questions, we are able to get a better understanding of what is currently attracting attention in the area of sustainability, and what is required of companies, in order to keep us aligned with the rest of the world. If the assessment exposes any issues, they can be discussed within the company and be improved. There is no end to the challenges we need to tackle, including the reduction of CO2 emissions, and we intend to keep up with our sustainability initiatives without compromising quality.
The Carbon Neutral LNG (CNL) was established in 2021 in Japan. The CNL Alliance members include Tokyo Gas Group, the primary provider of natural gas in Japan, private companies and public entities, and its mission is the realization of a carbon-neutral society by 2050.
Are there any particular areas of sustainability that you plan to focus on in the future, such as the environment, labor & human rights, ethics, or sustainable procurement?
We recently established a human rights subcommittee under our internal sustainability committee. As a supplier, we believe that human rights due diligence and understanding and managing the impact of corporations on human right is extremely important.
Regardless of industry, one of the most important parts of a company is its people. No matter how much IT evolves or how much AI automates operations, a company that does not value its people will not grow. Employees and stakeholders will only be motivated if they feel safe, which in turn will become a driver of growth.
As a chemical manufacturer, we have worked on occupational health and safety since decades before the concept of sustainability was widespread. Our employees are able to work healthily and safely and return home with smiles on their faces. Achieving such a culture is the basic premise of our actions.
What advice would you give to companies that want to be more sustainable in the future?
The EcoVadis assessment is important, but as I mentioned earlier, obtaining a high rating is not the primary objective. The first priority is working with integrity and sincerity. I believe that our assessment results are an extension of this effort.
The concept of ‘sustainability’ may seem overwhelming at first, but it’s best simply to take things one step at a time. Sustainability is a climb, one where you steadily advance while resolving issues as they come up. We will continue to use the EcoVadis assessment as a guidepost to learn about our current standing and respond with the times.
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