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Concept of sustainability management

We are committed to providing excellence to improve the quality of living and to drive sustainability.

Today, the world faces myriad challenges ranging from environmental degradation through poverty and human rights, to energy and resource supply issues. The causes of these challenges are too complexly entwined to be solved by efforts of state governments, international organizations, or civic society acting alone. The expectation then in addressing these social issues is that business corporations, which have a variety of resources available on a global scale, will also contribute.

Based on the RICOH Way, the Ricoh Group pursues its mission—to develop and offer new value—in order to make active contributions to improve the quality of living and to drive sustainability. To achieve this goal, we work in cooperation with a variety of stakeholders in our efforts to support the Sustainable Development Goals (SDGs).

Materiality for the Ricoh Group

Global Goals for Sustainable Development (SDGs) adopted by the United Nations to be achieved by 2030.

Global Goals for Sustainable Development (SDGs) adopted by the United Nations to be achieved by 2030.

CSR framework

Our CSR measures are implemented mainly in the following three areas: “fundamental obligation to society” and “Commitment to and responsibility for social contribution and Resolution of social issues through business activities (Creating Shared Value: CSV)” By working more profoundly in these areas, we will pursue our goals of creating a sustainable society and improving our corporate value.

■ CSR framework

image:CSR framework

Our measures are taken in response to the expectations and requests of various types of stakeholders in a timely and precise manner. We adopt CSR frameworks stipulated by the international community in a proactive manner and properly disclose information through reports and websites.

International initiatives and commitments

Businesses are required to take on an increasingly greater breadth and depth of responsibilities to help build a sustainable society. Public expectations and demand for these initiatives from global corporations operating worldwide have been increasing more than ever before. To meet these social expectations accurately and promptly, the Ricoh Group actively introduces internationally established CSR frameworks.

In 2002, the Ricoh Group became one of the first Japanese companies to announce participation in the United Nations Global Compact (UNGC). We promptly endorsed this global platform out of recognition of its alignment with our long-standing practice of listening to our many stakeholders and incorporating their feedback into our business operations based on global perspectives. In 2004, we established the Ricoh Group CSR Charter, which reflects the UNGC’s 10 principles, as well as the Ricoh Group Code of Conduct.

In addition to the UNGC, there are many other CSR guidelines, including ISO 26000, the international standard for social responsibility, which was formulated in November 2010.
Operating in more than 200 countries and regions worldwide, the Ricoh Group is committed to fulfilling its social responsibilities and meeting and exceeding the expectations of an increasingly wider and more varied stakeholder base. To this end, we review the CSR activities of our own as well as of our partner companies and key members of our global value chain, against international CSR frameworks and make continuous improvements.
These CSR activities along with our performance and other related information are disclosed through our publications and website and other communication tools.

Major CSR Guidelines introduced or used for reference

  • Universal Declaration of Human Rights
  • The 10 principles of the United Nations Global Compact
  • Human rights guidelines based on the United NationsGuiding Principles on Business and Human Rights (the Ruggie Framework)
  • Children’s rights and business principles
  • ISO 26000 (social responsibility standard)
  • OECD Guidelines for Multinational Enterprises
  • ILO international labor standards
  • GRI Guidelines

Commitment to Society

April 2002 Becomes the second Japanese company to sign the UN Global Compact
June 2007 Signs Caring for Climate: the Business Leadership Platform of the UN Global Compact
May 2008 Signs the Japan Business Initiative for Biodiversity
December 2008 Signs the CEO Statement for the 60th Anniversary of the Universal Declaration of Human Rights by the UN
July 2009 Participates in the Japan Climate Leaders’ Partnership as a founding member
December 2010 Announces its support for the Cancun Communiqué on Climate Change
February 2011 Signs a statement of support for the Women’s Empowerment Principles by the UN Global Compact
November 2012 Participates in the Carbon Price initiative to counter climate change
September 2014 Announces its support for the World Bank Group’s Put a Price on Carbon Statement
September 2014 Announces its support for the Trillion Tonne Communiqué, a call to keep cumulative CO2 emissions below a trillion tonnes
April 2017 Ricoh becomes the first Japanese company to join RE100, a global initiative that advocates 100% renewable energy.

The UN Global Compact (GC)

image:THE GLOBAL COMPACT

The UN Global Compact, launched in July 2000, proposes ten principles in the fields of human rights, labour, environment and anti-corruption. Ricoh joined the Compact in 2002, as one of the first Japanese companies to do so and has been serving as one of the directors on the Global Compact Japan Network since fiscal 2008.

The Ten Principles

  • [Human Rights]
  • Businesses should support and respect the protection of internationally proclaimed human rights; and
  • make sure that they are not complicit in human rights abuses.
  • [Labour]
  • Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;
  • the elimination of all forms of forced and compulsory labour;
  • the effective abolition of child labour; and
  • the elimination of discrimination in respect of employment and occupation.
  • [Environment]
  • Businesses should support a precautionary approach to environmental challenges;
  • undertake initiatives to promote greater environmental responsibility; and
  • encourage the development and diffusion of environmentally friendly technologies.
  • [Anti-Corruption]
  • Businesses should work against corruption in all its forms, including extortion and bribery.

Stakeholder engagement

Stakeholder engagement is an essential part of CSR management. We listen carefully to our customers, suppliers and all other stakeholders, take their feedback seriously and incorporate their input into our internal reform efforts. We also collaborate with NPOs, NGOs and other social sector organizations in planning ways to solve social issues.

Engaging stakeholders

Value to customers Customers Increase customer value through products and services
Offer safe and reliable products and services
Business partners Build partnerships based on mutual trust and fair trade
Promote socially responsible activities across the value chain
Value to shareholders Shareholders and investors Increase corporate value by achieving sustained business growth
Provide timely and appropriate information disclosure and communication
Value to employees Employees Provide workplaces that motivate our diverse employees
Maintain a culture that fosters personal development and fair treatment
Value to society Society Contribute to solving social issues through social contribution and business activities
Respect the cultures and customs of the countries and regions in which we operate, and contribute to their development
Global environment Conduct business activities in an environmentally friendly manner and contribute to the reduction of environmental impact
Contribute to the maintenance and restoration of the Earth’s self-recovery capabilities

CSR global governance and monitoring across the Group

Our social responsibility efforts evolve in three stages: from assessing legal, regulatory and other external requirements; to mission- and responsibility-driven voluntary activities that proactively meet expectations from society; to the third stage, where we work to create shared value by solving social issues while concurrently accelerating our growth.
To govern and monitor Group-wide activity in each of the three stages, we deploy our CSR management cycle.
Under this system, the Head Office collects information and feedback from operating organizations on the ground to identify and provide necessary support. The Head Office and operating units also hold periodic opinion exchanges and discussion forums to improve the quality of their respective CSR activities.

image:CSR global governance and monitoring across the Group

Dialogue with Experts

For the Ricoh Group, providing stakeholders with information about the Group's CSR-related vision, targets and specific activities is essential to improving its corporate activities and increasing its corporate value. In order to enhance the Ricoh Group Sustainability Report as one of the important tools to foster communication with stakeholders, we have been holding dialogue meetings with experts in the fields of CSR and integrated reporting. The results of these dialogue meetings, in which invited experts give their comments and advice and exchange opinions with Ricoh people, are reported to the management team and utilized for the improvement of the Group's management and communication activities.

Outline of the Sustainability Report dialogue meeting with experts

Date April 13, 2017
Place Head office of Ricoh Company, Ltd.
Invited
participants

    Experts:

  • Mr. Eiichiro Adachi, Director, The Japan Research Institute, Ltd.
  • Mr. Tsukasa Kanai, Chief Sustainability Officer, Corporate Planning Department,Sumitomo Mitsui Trust Bank
  • Ms. Mariko Mishiro, Representative Director of RIDEAL

    Participants from Ricoh* :

  • Akira Oyama, Corporate Executive Vice President; General Manager of Corporate Coordination Division
  • Yoichi Kawagiri, Executive Officer; General Manager of Corporate Strategy and Planning Center and Corporate Communication Center, Corporate Coordination Division
  • Masahisa Honda, General Manager of Investor Relations Department, Corporate Communication Center, Corporate Coordination Division
  • Kiyoshi Hashimoto, General Manager of Public Relations Department, Corporate Communication Center, Corporate Coordination Division
  • Satoshi Abe, General Manager of Social Environment Department, Sustainability Management Division

* The organizations and job titles are as of the date of the meeting.

image:The dialogue meeting

The dialogue meeting was the fifth held following the first meeting organized in the fiscal year ended March 31, 2013—the year in which we published Ricoh Group Sustainability Report 2012 as an integration of the following three reports: Annual Report, Sustainability Report (Corporate Social Responsibility) and Sustainability Report (Environment).
In this fifth dialogue, experts shared their views on descriptions included in the Sustainability Report 2016, focusing on the overview of value creation, KPIs, negative information disclosure and governance.

Major opinions given by experts

image:Mr. Eiichiro Adachi
Mr. Eiichiro Adachi





Mr. Eiichiro Adachi

  • Ricoh's approaches to creating corporate value have been more clearly described by offering the definition of each of the different values and notes on KPIs. The technological strengths section is substantial, containing details on how Ricoh’s unique personnel policies, culture and philosophy support its R&D systems. My advice for improvement is that a number of actual cases involving these systems, where issues were successfully managed, could have been introduced to make the section more convincing as a whole.
  • The Report includes an outline of the improper accounting practice identified at the Indian subsidiary. Details have been disclosed to a satisfactory, if not sufficient, degree, considering the current situation. In Japan, an increasing number of similar incidents have been reported in the past few years, which indicates that many Japanese companies expanding overseas are facing governance issues involving global businesses, and experiencing particular difficulties in maintaining adequate control over group companies and suppliers outside Japan. As one of such Japanese companies, Ricoh should publicly share its appropriate and firm stance in order to fight against this industry-wide challenge that is drawing increasing attention from society.
  • The Report could be enhanced by including more about the risks of Ricoh's operations producing negative impacts on society. It is certainly encouraging that management messages emphasize the company's commitment to solving global and local social challenges through its business activities. In addition to this, however, more discussion should be had on the theme of negative impacts. The company should communicate more openly its efforts to identify actual and possible adverse impacts its business activities have on society and take measures to reduce identified impacts. Such a sincere attitude toward negative information disclosure will be favorably received by risk-sensitive investors. Companies should be aware that such an attitude is becoming more important in order communicate convincingly with the public.

image:Mr. Tsukasa Kanai
Mr. Tsukasa Kanai


Mr. Tsukasa Kanai

  • It is notable that there are more descriptions of business strategies, particularly for new areas. To enhance these descriptions, my suggestion is to develop them into storytelling-style articles to account for how the strategies will work to increase stakeholder value and Ricoh's future corporate value, referring to numerical targets. This could help make the section more appealing.
  • The governance section has been substantially expanded in line with the structural reform. It is regrettable, however, that the description constitutes no more than a factual summary of established system activities. One remedy would be to include future plans, specifically for strategies to strengthen the earnings power under the new structure, or how to practice the government-advocated "proactive" governance management within the company.
  • The section on risk management, including that on compliance, could be improved. Particularly, details of total risk management systems should be included as they have actually been implemented. Also, the list of major risks does not provide specific information sought by investors. Their key interests are in how appropriate systems have been built and implemented to prevent compliance-related and other risks from materializing and how a desirable corporate culture has been developed to ensure the effective implementation of the systems. Solid corporate systems are essential for controlling ESG risks that can reduce corporate value and, accordingly, are important for improving corporate value. The section could be rearranged to reflect the above recognition, which would help ensure effective corporate communication directed at the public.

image:Ms. Mariko Mishiro
Ms. Mariko Mishiro







Ms. Mariko Mishiro

  • Approaches to value creation have been clearly presented, as in the 2015 Report, using images accompanied by brief written explanations. To deliver effective corporate communication, it is important to strike a balance in terms of a number of binary oppositions: between positive and negative, past, present and future, short term and long term, financial and non-financial, risk and opportunity, risk and return, and others. The overall section on value creation lacks appropriate balance in terms of risks. To remedy this, descriptions on risks should be increased, resulting in a more convincing story of the reality, which should appeal to readers more than a simple if beautiful story of ideal visions.
  • KPI setting should be improved to reflect values that are truly essential to Ricoh. For this purpose, the company's future visions need to be clarified verbally and KPIs based on them carefully set. As a first step, calculation methods for ongoing indicators for customer satisfaction and employee satisfaction should be reviewed in view of historical backgrounds to check for consistency with goals.
  • In the governance section, comparative charts have been presented effectively to illustrate a change in the corporate governance structure. Being appropriately simple and easy to understand, they are reader-friendly. To improve the section overall, a short summary of relevant information could have been included, such as on the background and reasons for the change (the size and formation of committees) that were subject to discussions and decisions.
  • The report on the identified inappropriate accounting practice, included in the management interview and governance sections, provides details in a sincere fashion. For negative information disclosure, it is vital that members of the top management team communicate their messages to the public on the risks of negative impacts in order to convey their proactive stance toward integrated thinking. In the event of negative impact incidents, appropriate follow-up reporting is critically important. Given that by nature this type of reporting is made on an as-needed basis, follow-up activities can be summarized for each year to be included in annual reporting.

Ending the dialogue with experts

image:Akira Oyama Executive Officer, General Manager, Corporate Coordination Division
Akira Oyama

We have worked to improve our reporting activities based on advice and suggestions provided by experts at the dialogue every year. We aim to fully achieve improvement goals, but this does not mean the end of improvement activities, as we also need to respond to the changing expectations of society. To understand relevant changes in social expectations, the annual dialogue with experts is very helpful. We deeply appreciate participating experts for offering extensive, insightful opinions and advice not only in terms of description and editorial methods but also fundamental management concepts and systems. We will utilize these opinions to improve our management practice.