Calbee : Sustainability (1.0MB)

SECTION 3

Calbee Group Sustainability

Since its beginning amid food shortages in postwar Japan, the Calbee Group has been rooted in the development of food products that utilize unused natural ingredients. Since then, we have engaged in co-creation with customers, business partners, and other stakeholders, driven by the desire to use natural ingredients to create products that will be good for people's health.

Going forward, we will continue to work with stakeholdersto target environmental, social, and economic issues through our business activities. This will allow us to engage in sustainability management and will create sustainable social and economic value.

The Calbee Group's founding philosophy

To be a company that gathers knowledge in order to create products that are healthy, safe, and affordable, and which utilize unused food resources.

Calbee Report 2022

Founder Takahashi Matsuo (right)

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Eight Material Issues (Materiality)

Environmental problems, labor shortages, and human rights issues- these are some of the social issues surrounding the Company. Of these issues, the Calbee Group has identified priority issues key to the continuity of its business activities as its materiality and has set a series of priority themes. Promoting efforts related to these themes will allow us to avoid management risks and take advantage of opportunities to spark innovation.

Calbee Report 2022

Materiality identification process

Step1	Organize social issues	List social issues, making reference to the SDGs and other frameworks
Identify the social issues relevant to the Calbee Group
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

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The Calbee Group's materiality

1. Assurance of food safety
2. Response to health-conscious and diversifying lifestyles
3. Progress of sustainable agriculture
4. Ensuring the sustainability of raw materials and logistics with improved efficiency

1. Caring for the earth
2. Foster deeper connections with people, local societies, and communities
3. Promote active roles for all employees based on diversity
4. Enhance corporate governance

Step3	Verify suitability	Hold workshops to incorporate internal opinions
Carry out interviews with external experts
Step4	Final identification of	Perform final identification of materiality based on internal and expert opinions
materiality

Creation Value the at Group Calbee

Materiality map

	High						• Assurance of food safety 1
							• Respond to lifestyles changes	2
							• Progress of sustainable agriculture	3
stakeholders							• Stably procure raw materials	4
						• Realize decarbonization of society	5
						• Promote resource recycling 5
		• Preserve the ecosystem 5	• Maintain and promote health	2	7		• Solve consumer issues	1
to			• Foster deeper connections with people, local societies,	• Increase supply chain management efficiency and
		and communities 6				ensure stable logistics	4
Importance
		• Strengthen business continuity plan (BCP)	8	• Employ and develop diverse human resources 7
			• Ensure information security	8
			• Prevent pollution and consider the environment 5	• Respond to diversification of food needs	2
			• Create good work environments	7		• Build appropriate governance systems	8
			• Respect human rights 7 8	8
			• Establish fair business practices
											High
			Importance to Calbee's businesses
For details regarding the Group's sustainability initiatives, please refer to the corporate website.	https://www.calbee.co.jp/sustainability/en/

Sustainability management promotion framework

The Sustainability Committee determines the Calbee Group's materiality, discusses and reviews the road map 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.

Board of Directors

Report

Sustainability Committee

Theme identification and		Strategy determination and
monitoring		progress reports

Subcommittees for each priority theme

(promote strategy execution)

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Eight Material Issues (Materiality)

1 Assurance of Food Safety

Providing safe and secure products is our greatest responsibility. The Calbee Group is working to strengthen its quality assurance system throughout the entire value chain by always listening to customer feedback and making improvements based on their suggestions.

Prevention of safety and quality incidents

Calbee Report 2022

Initiatives for monitoring security

Addressing food allergies

The matter of food allergies requires our full attention and a commensurate response. As part of this effort, we make it easy to see allergens present in a product on the package, and, in principle, we adopt designs that make the list of allergens stand out under the ingredients list. Based on cus-

tomer feedback, we also clearly denote when common Allergen labeling allergens are not present within a product. Allergen informa-

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Compliance for the safe procurement of raw materials

In terms of legal compliance to ensure safety, in March 2022 all of the Group's domestic products were compliant with September 2017 revisions to food labeling standards based on the Food Labeling Act. This requires that the raw materials section of labeling for domestically-produced processed

tion for products is also posted on our website.

The quality assurance system that supports our value chain

Prevention of safety and quality incidents  Initiatives for monitoring security

Product improvements reflecting customer feedback

Group Calbee the at Creation

foods indicates the country of origin of the main raw materials used in the item. We also conduct on-site audits of locations where we procure raw materials in order to maintain and improve safety and quality.

Enhancing quality management and inspections in the manufacturing process

We take some measures to prevent contamination by foreign matter, including the introduction of X-ray inspection equip- ment, metal detectors, and surveillance cameras at our manufacturing sites. To prevent mistakes on ingredient lists in some of our packaging processes, we also have installed an error prevention checking system that checks whether the

Labeling with the country of origin listed alongside raw materials

On-site survey of raw materials

Comply with relevant laws and regulations, inspect package labeling

Inspect quality specifications and standards

Disclose and manage allergen information

Respond to customer feedback

Improve products in response to customer feedback

Respond to distributor inquiries

Product

Planning and

Development

Customer

Feedback

Sales

Procurement

Production

Logistics

Confirm safety of raw materials and compliance with laws and regulations

Audit procurement of raw materials and productions processes

Disclose information, ranging from potato production areas and producers, to factories

Support quality improvement

Enhance system for quality control and inspections

Thoroughly implement management standards for inventory and incoming/outgoing data

Implement quality assurance during transportation and storage

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product content matches its packaging.

Quality inspection of products

		Enhance global quality
Quality Assurance System Enhancement		assurance system

Provide employee education on quality

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Eight Material Issues (Materiality)

2 Response to Health-Conscious and Diversifying Lifestyles

As customer preferences become more diverse, the Calbee Group will provide healthcon- scious products and help support the varied lifestyles of customers.

	KPI
Salt equivalent in products*1:	Sales ratio of protein-rich foods*2:
FY2024/3 20% reduction	FY2024/3 10%
(Compared with FY2019/3)

*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

Calbee Report 2022

Development of plant-based products

The Plant-Based Lifestyle Lab is a general incorporated association that aims to enlighten people and spread the concept of a new kind of lifestyle, which incorporates plant-based food products, and to frame these products as a means to realize a sustainable society. The organization was established in October 2021 with the collaboration of multiple companies, including Pasona Group Inc., Kagome Co., Ltd., and Fuji Oil Holdings Inc.. The Calbee Group has joined these ranks with the intention of exploring new fields related to health-consciousness.

The Calbee Group launched the "Plant Based Calbee" project in order to make products that use plant-derived ingredients more delicious and familiar, and offers a series of products. From March 31, 2022, we have launched several such products, such as SOY Guru, a plant-based drinkable yogurt made from fermented soy flour; SOY's Flakes, a cereal made from soybeans; and the Planty Plantie series of plant-based ice cream and cheesecake-style desserts.

Note: Some of the products have been discontinued

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Provision health-conscious products

Reduction of salt equivalent and supplementation of nutrients that tend to be deficient

The Calbee Group provides nutritionally balanced products that harness the power of natural ingredients and are good for the body. We have highlighted salt and protein as nutrients that need to be properly controlled in order to live healthy lives, even as dietary habits diversify. We are investigating the optimal amount of salt in each of our main products. We are working to reduce the salt equivalent in our products, while working to create products that make the most of the original taste of their ingredients.

Protein is a nutrient vital for a healthy lifestyle, yet it is often consumed in insufficient amounts. The Calbee Group has developed products aimed at providing this protein, such as Sayaendo, miino (a brand of fried, whole fava beans), and Granola Plus Protein.

SOY's Flakes, a cereal made	SOY Guru, yogurt pro-
from soybeans	duced from soybeans

Kappa Ebisen with 35% reduced salt equivalent

The Planty Plantie series of ice cream, made from soybeans instead of dairy

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Granola Plus Protein, made for easy protein intake

Data

Soil moisture meter installed in a potato field

Eight Material Issues (Materiality)

3 Progress of Sustainable Agriculture

Calbee Report 2022

and support producers in order to maintain stable procurement and improve agricultural productivity and sustainability.

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The Calbee Group takes advantage of its potato expertise to develop new potato varieties and support producers in order to ensure stable procurement of raw materials, and improve agricultural productivity and sustainability.

KPI

Domestic procurement volume of potatoes: CY2030 

400,000 tons

(up 20% compared with the FY2019/3)

Measures for sustainable procurement

1) Development of potato varieties

To date, we have worked with research institutes in Japan and overseas to develop potato varieties with a view toward greater yield, quality, disease resistance, storability, and suitability for processing. In 2017, we registered our new proprietary Poroshiri variety, which is more pest-resistant than existing varieties of potato. We are also continuing development of heat- tolerant varieties in response to climate change. Going forward, we aim to develop four new proprietary varieties by 2030.

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Kazuhiro Nakamura

Managing Executive Officer, Calbee, Inc.

Chairman and Representative Director, Calbee Potato, Inc.

He joined Calbee Potato, Inc. in 1984 and has experienced every part of the value chain, from the potato fields to sales, including as a fieldmen (specialists in potato fields), developing new varieties, serving as general manager of Calbee's Hokkaido Business, and becoming president & CEO of Calbee Potato, Inc. He gained his current position in April 2021.

Sustainable, environmentally conscious procurement:

stable procurement of potatoes

2) Promote scientific cultivation

We have implemented procurement achieved through potato cultivation technology that draws upon scientific evidence. We utilize a centrally managed cultivation information system to provide producers with data-driven advice. One example

of this system undergoing verification trials is a smartphone app that provides producers with suggested irrigation times based on data provided by soil moisture meters installed in potato fields. This ensures that potatoes will maintain a moisture level ideal for cultivation. In addition to measure such as these, which help maximize potato yields, we are also helping increase the number of new potato producers by providing technological support to those with no previous

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Understanding business environment and issues

As a maker of products focused on potatoes and other natural ingredients, the Calbee Group believes agriculture must always be soundly managed to ensure business continuity. The past two years have seen low yields, stemming from droughts and other effects of climate change. Under these conditions, we are working to develop new potato varieties

Fieldmen (specialists in potato fields) providing cultivation support to producers

experience cultivating potatoes.

We intend to promote operation of a platform that links information related to producers, potato fields, cultivation, weather, and storage. In addition, we would like to promote

scientific-based cultivation further by expanding this dataIrrigated Unirrigated management to crops other than potatoes in the future.

Comparison of irrigated and unirrigated land as optimized by a soil moisture meter

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