Sugino Machine Group Code of Conduct

In order to ensure the Group as a whole acts based on high ethical standards and operates under compliance to continue to be a corporate group trusted by society, the Sugino Machine Group has established the "Sugino Machine Group Code of Conduct" that all employees and executives must abide by.

1. We will respect decorum and treat all stakeholders, technology, products, companies, and families with honesty and respect.
2. We will obey the law, and when we encounter illegal activities will report and reform them regardless of the position or affiliation of those involved.
3. We will quickly announce when a problem has occurred, and earnestly attempt to determine the cause and work to prevent a recurrence.
4. We will understand the position and rights of our job, and exercise them appropriately according to all relevant rules.
5. We will understand the duties and responsibilities of our job, and work together towards a common company goal using all the abilities at our disposal.
6. We will teach our successors the lessons taught to us by our predecessors, both maintaining tradition and acting under the company philosophy while striving towards further growth.
7. We will respect differing opinions, and listen to ideas from both within and without the company, striving to improve communication and foster an environment of trust, cooperation and mutual benefit.
8. We will not make decisions based on impressions, guesswork, assumptions or convention, and will always confirm the truth.
9. We will not fear or reject failure, and will continue attempting to create new products and value.
10. We will provide products the market desires in order to contribute to society.
11. We will use all past experiences, including failure, as stepping stones towards the future.
12. We will maintain a spirit of independence and autonomy, always seeking to improve through continuing challenges.

Sugino Machine Group Standards of Conduct

The Sugino Machine Group Standards of Conduct were set out in order to establish specific codes of conduct to be complied with in daily business activities. Specific standards are established so that an employee take the proper actions according to compliance guidelines in a certain work situation.

1. Customers

1. We will treat customers with sincerity and respect, and we will strive to improve our product and service quality based on customer feedback.
2. We will carefully manage quality and inventory storage periods in accordance with internal company rules.
3. We will comply with various regulations and standards in order to provide safe products.
4. We will clearly indicate proper handling methods and precautions, and we will make sure to explain them properly so that products can be used safely.
5. We will not engage in unfair trade practices and improper trade restrictions.
6. We will strive to create products that satisfy customers by ensuring work standards are followed and quality assurance is carried out, as well as by implementing verification tests.
7. We will strive to prevent the recurrence of quality defects by thoroughly determining the cause and quickly implementing a solution or counter-measure.
8. We will disclose product information as required by laws and regulations.
9. We will not use misleading expressions about the performance or quality of our products.
10. We will responsibly manage our customers' confidential and private information to ensure it is not leaked.
11. We will resolutely refuse requests that are unacceptable to society at large.

2. Suppliers

1. We will refuse to offer any excessive hospitality or benefits.
2. We will use impartial standards to select suppliers for the procurement of goods and services.
3. We will obey laws and regulations, and engage in fair transactions with suppliers while respecting the position of the other party.

3. Society and the Environment

1. As members of the local community, we will strive to co-exist in harmony with and consider the health and safety of local residents.
2. We will strive towards the effective use of resources and environmental conservation, creating harmony between the natural environment and our living environment.
3. We will respond to anti-social forces with firm resolve.
4. We will maintain social communications and engage in highly transparent business activities.
5. We will obey laws and regulations, and act with the safety of people as our primary concern in all situations.
6. We will respect the laws, history, culture and values of various regions around the world, and contribute to both the local area and the world.

4. Politics and Government

1. We will not provide gifts or other benefits to government officials, politicians or members of organizations with vested interests.
2. We will quickly respond to any requests for reports or inspections from relevant government agencies.

5. Our Company

1. We will obey laws and regulations and carry out fair business activities.
2. We will respect the rights of others while using our own company rights effectively.
3. We will adopt a whistle-blower system to prevent problems from occurring and spreading.
4. We will obey labor laws and regulations, and provide a safe and pleasant workplace environment at all times.
5. We will not take other actions that make people uncomfortable or force others into sexual relations.
6. We will not use our position or authority to threaten or bully others.
7. We will adopt a fair human resource system to determine performance evaluation and reward.
8. We will not take confidential or important information outside the company.
9. We will provide thorough ethics training and act in a socially acceptable manner.
10. We will separate our work and private lives, and we will not use working hours or any company device or equipment for personal use.
11. We will check whether our actions are consistent with the standards of conduct and company motto at all times.
12. We will handle the private information of our employees in an appropriate manner and with due care.
13. We will provide training for employees to learn about their work and responsibilities, and strive to improve work quality.

Ensuring Compliance

Policy

In order to ensure compliance, the actions and awareness of each employee of the Sugino Machine Group is important. We believe it is crucial to always conduct business fairly and lawfully. In the Sugino Machine Group, all employees including the management carry out their duties responsibly and ethically. We aim to grow together with society by providing innovative products and services to meet the expectations and earn the trust of all stakeholders, including customers, trading partners, local society etc.

Protection of Intellectual Property Rights

The Sugino Machine Group understands the importance of intellectual property rights and protects the intellectual property rights of other companies while also appropriately managing its own intellectual property.

Response to Anti-social Organizations

The Sugino Machine Group has no relationships with any anti-social organizations or groups that threaten public order or safety.

Appropriate Export Transactions

The Sugino Machine Group follows international rules and laws in its global activities and has an export control system in place to ensure that international transactions for products and services provided are not misused for the proliferation of weapons of mass destruction, for the support of terrorism, or for some other purpose that threatens world peace.

Internal Auditing System

The Sugino Machine Group strives towards greater transparency and aims to create a rational structure for its business operations. We have also created an impartial audit system with an independent audit department.

Development of Human Resources and Utilization

Initiatives towards Cultural Diversity

As a company aiming to expand its business globally, we require not only global talent but initiatives towards cultural diversity as well. Diversity management plays an important role in providing the values that are sought by society from a global perspective.

In order to expand our activities to growth markets worldwide and sink business roots in local regions and countries, it is vital to hire personnel who are familiar with the language and culture of that region. In order to respond to diverse values and changes in the business environment, we will respect individuality and diversity to increase the potential of our work force.

From Crafting People to Craftsmanship

The human resource development goal at Sugino Machine is to nurture workers who can "think and act independently".
The business environment is constantly changing in line with the globalization and diversification of customer needs, as well as the adoption of new technologies. In such an environment, it is necessary to develop professionals who not only have a high level of specialized knowledge but are also able to look at things from multiple perspectives, analyze them, and respond flexibly.

Besides on-the-job training that teaches specialized skills through actual work, we also have a system of training courses at different levels for specialized training, career development, skill development and management training. Many employees also choose to study languages or take correspondence courses on their own to acquire more specialized knowledge, or simply to increase their knowledge and improve themselves.

Quality Control

At Sugino Machine, in order to deliver safe, high-quality products to customers, we carry out a number of tests during the development and planning stages and implement thorough quality control in daily activities.
Sugino Machine employees are involved in continuous product improvements in order to provide high-quality technology and services that accurately capture and fulfil customer needs at every point in the process, from sales to customer service.

Health and Safety Activities

In order to prevent workplace accidents or health problems for employees, Sugino Machine carries out health and safety activities according to "Health and Safety Management Regulations". In addition to safety patrols and comprehensive protective equipment that takes into consideration the characteristics of each plant, health and safety training is also provided to raise awareness among employees as part of the efforts to reduce or eliminate the risk of accidents in the workplace.

In addition to conventional safety measures that are corrective in nature, preventive measures are also promoted through the workplace health and safety management system. Information about close calls that occur during normal duties is publicized and shared, and the causes of workplace accidents are analyzed so as to prevent them from recurring again.

Environmental Declaration

Basic Environmental Philosophy

Sugino Machine will respect environment conservation in all its corporate activities, from the development and design of machines and equipment, all the way to production, sales and services. Effective energy use will also be encouraged, with every employee engaged in environmental conservation so that limited resources may be used efficiently. The goal is to create an environment where people can live more comfortably, peacefully and richly in harmony with nature.

Environmental Policy

We will follow the guidelines below, and strive to become a company that promotes conservation of the environment.

1. In addition to preventing pollution and reducing the consumption of electricity and other energy, an environmental management system will be created to maintain and continually improve these goals.
2. Environmental laws and regulations, as well as other requested guidelines that are adopted, will be observed.
3. With the points below as a theme, goals and targets will be determined to continually work towards improving the environment.
   (1) Creating Machines and Equipment Useful for Environmental Improvement
   (2) Promoting the Conservation of Resources and Energy
   (3) Recycling and Reducing Waste Products
   (4) Preventing Accidents and Leaks of Oils, Paints, etc.
   (5) Preventing Environmental Pollution Around Plants and Promoting Conservation Activities

Energy Efficiency Activities

Initiatives in Energy Efficiency Activities

At Sugino Machine, we periodically check the energy usage of all our offices throughout Japan and we encourage switching to energy efficient devices in order to manage and optimize total energy usage.
Led by the Energy Efficiency Committee, suggestions for energy efficiency throughout the whole company are periodically sought in order to develop and implement measures for greater energy efficiency.

Specific Initiatives

In April 2010, Sugino Machine created an organizational structure for promoting energy efficiency and began by measuring energy usage including electricity, natural gas, and kerosene.
Subsequently, a workshop called the "Energy Efficiency Promotion Seminar" was held in collaboration with a power company. Besides the Energy Conservation Act, future activities were also discussed.
Individual offices also invited optimization specialists from external energy efficiency organizations and discovered new energy efficiency plans to implement, such as adjusting compressor discharge pressure, reducing lost electricity from heat treating furnaces, and optimizing ventilation efficiency.
In addition to complying with the Energy Conservation Act and reducing energy usage, there are also initiatives in environmentally-friendly activities such as reducing the emissions of carbon dioxide caused by business activities.

Youth Education

Student Internships

Sugino Machine is involved in activities to support students, in whose hands the future of craftsmanship rests. With the goal of having students become interested in craftsmanship by actually experiencing the work process in the plant, student interns are accepted every year. As part of our contribution to the development of Japanese craftsmanship, we will continue to support students in the future.

Factory Tours for Students

Sugino Machine has provided many students with tours of our factories. By having the tour participants experience water jet cutting, we hope they take an interest in craftsmanship. Hoping that students on the tour will become excellent engineers in the future, we continue to support education.

Passing on Skills and Knowledge to Students

Sugino Machine collaborates with industrial high schools to hold the "High School Craftsman Skill Development Workshop", sending engineers to participate. At this workshop, high school students who will participate in the "Monozukuri Contest" are tutored in metalworking by nationally certified "High Proficiency Skilled Workers". Practical skills and knowledge were taught in preparation for the contest, such as shaving down a metal cylinder into a screw and making parts with uneven surfaces.