Opinion of a Third Party

　This is the seventh year that I am responsible for giving the third-party opinion of the DOWA Group’s CSR Report. While I look forward to the progress of this report every year, what first caught my attention in this fiscal year's report was the special feature on the development of human resources and the organization. In the area of human resources, they analyze both apparent and future issues, and it clearly shows that they are making a systemic medium-term plan for human resources. They have also renewed the training center, and it communicates the enthusiasm of the DOWA Group to prize talent.

Towards further improvement

　The need for companies to establish materiality (important issues) is becoming essential. There is the importance of the company’s point of view and its impact on the business, and the importance of the external point of view via the expectations and requests of stakeholders. Evaluating from these two focal points, specifying materiality for the DOWA Group also leads to an integration of corporate management and sustainability from a management perspective. When institutional investors evaluate companies from the viewpoint of ESG (environmental, social and governance), they place emphasis on materiality, and it is important for group employees in Japan and overseas to recognize the company’s materiality. I recommend that this be considered for the next fiscal year.

　In the special feature on “Sustainable Mine Development”, you can understand well the recognition by the DOWA Group of their social role in supplying the metals that are essential to Japanese manufacturing. In order to process the metallic materials required by society, they explain that they are smelting from two raw materials - the mineral concentrate newly produced from mines, and recyclable metal raw materials that they collect in Japan and overseas. However, they mention that recycling alone cannot cover the global demand that keeps growing, and as readers of the CSR report we should be worried about the problem of metal resource depletion. If mining continues at the current pace, there are reports that some metals will run out within 20 years. From the viewpoint of business management, I think that it would good to explain what kind of perspective they have about the resource depletion problem, and how they are responding to it. This will lead to specific business strategies for target 12.2 of the SDGs - “By 2030 achieve sustainable management and efficient use of natural resources”.

　In supply chain management, they explain their promotion of CSR to the whole supply chain. Currently, companies are being questioned more about not just their in-house initiatives, but also their responsibility for initiatives through the entire supply chain. In the midst of this, the DOWA Group is distributing self-check questionnaires to key suppliers, and by further sending the suppliers a feedback report, it shows that DOWA is making a serious effort at two-way communication. It is a concern that the DOWA Group CSR procurement guidelines have not been disclosed. I think it would be good to show what are the specific policies, including the environmental and social aspects, and clarify how they are trying to raise the standard for the supply chain as a whole.

Expectations for future initiatives

　Currently, interest in the circular economy is rapidly rising in various countries around the world. In the EU, the circular economy policy package was launched in 2015, and attempts have begun to convert society as whole into a sustainable direction while increasing the competitiveness of the economy. Even in Japan, while we have been putting effort into the formation of a policy-based recycling-oriented society from before, in the concept of the circular economy which is currently drawing attention, there is a strong sense of constructing a new business model with innovation. I think that this might be an area where the DOWA Group can demonstrate the strengths that they have fostered in their main business. I hope that DOWA can play a leading role in promoting a global circular economy that centers on collaboration with others, such as companies, international organizations, government agencies and research institutes.