In fiscal 2015, the Toray Group conducted a materiality assessment to identify the issues that are most important to its pursuit of social responsibility (material issues for CSR). In fiscal 2016, the Group reevaluated the material issues when drafting its Sixth CSR Road Map, which started in fiscal 2017. This process incorporated input from thought leaders and resulted in revisions to the issues.
Materiality Assessment Cycle
The Toray Group regularly implements the following process to reevaluate its material issues for CSR.
Dialogue with Thought Leaders during the Reevaluation of Material Issues
In November 2016, the Group held a dialogue meeting with several thought leaders to share their valuable input on its material issues for CSR, seeking to benefit from their specialized knowledge. The Group incorporated the valuable advice received during the meeting into its reevaluation of material issues.
Main Input from CSR Thought Leaders
Outside of Japan, the consideration of environmental, social and governance (ESG) factors by investors is gaining more and more mainstream traction. The Toray Group is responding to the trend toward ESG investment by pursuing forward-thinking, well-rounded CSR initiatives. However, it can be difficult at times to grasp the focus of these initiatives. For example, it would be advisable for the Group to disclose the global-scale issues that it believes are most material, and why it sees them that way. Furthermore, scrutiny will shift from the products the Group makes, to the raw materials the Group is using to make them. Addressing concerns like these can also create new business opportunities for the Group. The Group would do well to thoroughly discuss its choice of material issues and CSR Road Map, as well as to examine the Sustainable Development Goals (SDGs). I believe this will help the Group to expand its vision of the issues that the global community considers most pressing.
Faculty of Economics,
I have three suggestions. First, human resources and labor initiatives should be disclosed on a group-wide basis, rather than only for Toray Industries, Inc. Second, exercising responsibility for the supply chain is becoming more critical, so the Group needs to fully communicate its risks in the supply chain, including where in the supply chain those risks appear. Third, the Group needs to have a true long-term vision—longer than the next three or four years. Identifying material issues is a process that will help the Group to implement and strengthen its CSR initiatives. The Group should link the material issues to the implementation of specific initiatives.
CSO Network Japan
The United Nations Sustainable Development Goals (SDGs) set specific targets for the international community to achieve by 2030. I hope that the Toray Group will present its own long-term vision and use backcasting to identify the steps it will take to achieve it. It is becoming increasingly important to engage stakeholders in dialogue. The Group must establish mechanisms for gaining input from stakeholders in the supply chain and identifying their expectations, even if the Group does not directly do business with or directly employ those stakeholders. I strongly suggest that the Group perform human rights due diligence and create grievance mechanisms that are accessible to the public.
Updated Material Issues and Key Performance Indicators Reflected in the CSR Road Map
Based on the dialogue with thought leaders, the Group engaged in internal discussions on the material issues. The issues were then revised following discussions at the 31st meeting of the CSR Committee, which took place on June 13, 2017. First, the Group revised the CSR Road Map to reflect the updated material issues. This will enable the Group to implement specific initiatives that clearly address the material issues identified, and report on them based on the G4 Sustainability Reporting Guidelines from GRI. Secondly, the Group defined how the material issues are connected to the CSR Guidelines and the goals of the CSR Road Map, and established new key performance indicators (KPIs) for the revised material issues, in order to guide the implementation of initiatives.
While the Group's CSR initiatives reflect local circumstances in countries and regions, it also has shared, group-wide initiatives that are advanced under group-wide targets. The Sixth CSR Road Map includes group-wide KPIs, and calls for CSR initiatives to be implemented using the Plan-Do-Check-Act (PDCA) cycle.
Toray Group Materiality Matrix
Revising the Material Issues for CSR
Toray Industries, Inc.
The dialogue meetings with CSR thought leaders were a first for the Toray Group. The meetings gave us valuable input on ways to translate the material issues into specific initiatives and disclose useful information about what we are doing.
The Group's Sixth CSR Road Map, which spans from fiscal 2017 through fiscal 2019, specifies group-wide KPIs for the material issues we identified with the help of the input we received at the dialogue meetings. We will disclose our progress on the KPIs in the CSR report every year, and we will continue to engage with stakeholders as we strive to further strengthen our CSR initiatives.