Targets and Overview

FY2016 Overview

The CITIZEN Group regards the practice of the Citizen Group Code of Conduct as CSR activities. Every year Group companies establish CSR activity goals linked to the “Citizen Group Code of Conduct” and strive to fulfill those goals. Below is a selection of FY2016 activities.

FY2016 CSR Program Targets and Results and Future Issues (excerpts)

The rating criteria consist of 4 levels (A: Achieved all goals, B: Achieved almost all goals, C: Issues remain, D: Not implemented).
 Action plans that match the Citizen Group materiality are highlighted.

Company CSR Targets Results Self-Evaluation Future Challenges
Guideline 1: Act responsibly towards society and strive to raise the corporate value of the Citizen Group
CITIZEN WATCH Issue the Japanese and English editions of revised “Citizen Group Code of Conduct” in October and January,
respectively
・Issued the Japanese edition issued in October and the English edition in January, as planned
・Printed the Japanese edition on pamphlets, portable cards, posters
・To disseminate, created printable electronic copy of the English edition for pamphlets, ortable cards, and posters using the design used for the Japanese edition.
A ・Have the Code of Conduct declaration form signed by the president and full-time directors each year
・Create, roll out, use e-learning teaching materials; establish a management method for participants’ data
Issue translated versions of the Code of Conduct in multiple languages (April 2017):
Chinese (traditional and simplified), Thai, French, German, Italian, Spanish, and Vietnamese
・Had German, Italian, Spanish, and Vietnamese versions checked by persons concerned (March)
・Added the Portuguese version
・Following the English edition, made printable electronic copies of each translated version
B ・From April, roll out in overseas subsidiaries through controlling companies, etc.
・Roll-out Method in Chinese Subsidiaries: visit sites to determine the roll out method with management in person, and then execute the roll-out
Explain to all company presidents and full-time directors in Japan and obtain signed declaration forms from them ・Held explanatory meetings at each company and obtained declarations A Completed. Each year declarations will be obtained going forward.
Hold explanatory meetings for all employees and have them sign the declaration forms ・Explanatory meetings were held for nearly all employees in every company by April; declaration forms were obtained from 944 out of 1,002 people B Handle the cases which persons have not yet attended an explanatory meeting
The CITIZEN Group Establish a contact to reach to and a system for gathering reported information ・Built a system to collect the monthly data on the number of incidents reported at each company in Japan
・Received 34 incident reports in main 12 companies in Japan during fiscal 2016
B ・While information is gathered monthly, only the annual summary of the data is reported to the Board of Directors at year-end.
Guideline 2: Provide products and services that demonstrate our commitment to safety, quality, and the environment.
CITIZEN WATCH
Corporate Planning Division
The Corporate Planning Division takes the lead in promoting BCP and other risk management in the Group of watch business ・Implemented BCP exercises among office staff primarily in manufacturing bases
・Created Guidelines in overseas sales offices
A Transferred the responsibility over BCP and BCM to the General Affairs Division in January 2017
CITIZEN SYSTEMS JAPAN ・Undertake the renewal audit for ISO9001 certification
・Undertake the renewal audit for ISO13485 certification
・Implement education for those who have yet to receive it
・passed bsi maintenance/inspection in August. passed with zero non-compliance issues
・undertook ISO internal audit between November and January (Major incidents: 0; Minor incidents: 4)
・Implemented new-employee education and internal auditor seminar
A ・Respond to organizational change due to restructuring
・Prepare for the renewal audit as the certificate is due expiration in August 2017
CITIZEN SYSTEMS
JAPAN
・Unify quality standard levels for all plants (Tatsue, Fuji, CSJM)
・manage quality of outsourced manufactured products
・Investigate loss cost
(Target Rate for Labor Cost Loss: 0.5% or less in the second half of the year)
・Developed improvement measures for design/plants by analyzing market claims
・Inspected contracted plants (Alpha, H&L, Codyson)
・Target Rate for Labor Cost Loss: 3.3%, lower than the target of 5% for the second half of the year
A ・Monitor improvement measures for design/plants, and continue improvements
・Tackle CS response in all areas through the Quality Assurance Division
Strengthen feedback for design/plant through central management
CITIZEN WATCH
Product Planning & Sales Department
Promote product development that meets societal needs through collaboration among sales, planning, design, and technology departments Increased customer satisfaction in fiscal 2016 attributing to successive product launches such as ultra-thin “Eco-Drive One,”“CITIZEN L,”and Bluetooth watches A Continue in 2017 to develop products that satisfy customers such as “Eco-Drive One”, titanium, GPS, “CITIZEN L,” etc.
CITIZEN WATCH
Administration & Management Department
Supply products without any delay through coordination between Sales Division and production bases. Maintained the delivery rate at 98% or above and contributed to supply of products for sales. A Offer even more appealing products through on-time delivery at all time and cost-cut
CITIZEN WATCH
Product
Development Department
Improve DR quality by utilizing photo fabrication Received 497 orders and gained positive impact from rationalization worth ¥44.8 M in value that is beyond our goal in fiscal 2016 A Continue on overseeing maintenance and management items in the next fiscal year
・Introduce new types of modeling machines and take on new themes
CITIZEN WATCH MANUFACTURING ・1st year of IT innovation
1. Utilize data
2. Visualize data at the processing stage
3. Grasp and improve the process capability
・Company-wide quality improvement
・Introduced IT to 82ébauche, 90, 82 Ankle Line QC
・Started on visualization of the process capability (Pareto charts/control charts, etc.) and initiated improvements
・Amid continuous quality improvement activities, increased MV client (self-reproach) claims by 26%and exterior component claims by 24%
A Expand utilization of the data
CITIZEN MACHINERY Cincom CMJ Defect Ratio: 2.5%
CMA Defect Ratio: 2.0%, Reflux Apparatus Defect Ratio: 2.0%
CCM Defect Ratio: 2.0% Reflux Apparatus Defect Ratio: 2.0%
Miyano CMJ Defect Ratio: 3.0%
CCM Defect Ratio: 2.4%
CMP Defect Ration: 2.4%, Reflux Apparatus Defect Ratio: 2.4%
CincomCMJ Defect Ratio: 2.38% (Target: 2.5%)
CMA Defect Ratio: ---%, Reflux Apparatus Defect Ratio: 2.81%
CCM Defect Ratio: ---%, Reflux Apparatus Defect Ratio: 3.21%
Miyano CMJ Defect Ratio: 2.92% (Target: 3.0%)
CCM Defect Ratio: ---%,
CMP Defect Ratio: ---%, Reflux Apparatus Defect Ratio: 2.61%
B ・Reached the target defect ratio in Japan, but not the target reflux apparatus defect ratio for overseas production bases

・Continue providing instruction at the time of production transfer as well as on a regular basis

Monitor change in reflux apparatus defect ratios for overseas production bases since gathering information on local defect ratios are difficult
CITIZEN ELECTRONICS ◎ Implement development downsizing that reduces environmental burden
Control Item: one incidence of Top SW downsizing
Control Target: 100%
Developed the downsized version (LS220) of the top switch, LS38 as planned A Develop LS160 as horizontal expansion
CITIZEN T.I.C. Goal: Minimize new lot production claims to 55 or less
Key Measure: Develop 4M modification management for lot production products
*Based on progress in the first half of the year, tightened the goal to 20 or less

Received 11 claimed and achieved the goal
・Partially adopted the 4M modification management
B ・For general claims, shift the focus to corrective actions i at the divisions where the claims originated
・Continue spreading the 4M modification management
CITIZEN Customer Service Department Carry over the activities held in fiscal 2015
・Defect Ratio: Below1.00%
・Assessment: Above. 9.0 pts.
・Reassess quality standards and conduct individual training
April–July performance (defect ratio calculation method changed after August)
・Defect Ratio: 0.43%
・Assessment: 9.86 pts.
August–March performance (defects other than major defects also included)
・Defect Ratio: 16.9%
A Reassess and update inspection method in fiscal 2017
・Add defects other than major defects to defect calculation
・Create a repair operation manual
・Eliminate minor defects from dust and stains
CITIZEN WATCH
Quality Assurance Department
・Market claims, domestic defects, domestic distribution returns, regular analysis of CS information, assessment ・Apply client quality demands to quality standards ・Report the monthly analysis of market claims/ domestic defects in the monthly report on CWC quality
・Revised watch quality standards based on market claims
・Standardized eight matters and included them in the watch quality standards
B ・Take an approach toward measures through collaboration between the watch development division andthe CWMJ watch technology division
CITIZEN WATCH
Movement Division
・Hold technical seminars, participate in exhibits, and actively gather information on client needs
・Call for salespersons with the knowledge and education suitable for becoming client concierges
・Continuing from last year, held the 18th technology seminar at various sites; participated in exhibits in Basel, Hong Kong, Shenzhen, and Europe, and endeavored to collect information on client needs
・Started in Shenyang to improve client satisfaction,in addition to Guangzhou (Shenzhen)/Xi’an SC, establishment activities
A Continue the activities/responses performed in fiscal 2016 and must initiate greater change in awareness/system improvement that unifies manufacture/sales targeting client satisfaction against failure to swiftly respond while product quality issues continue to occur frequently
CITIZEN WATCH
Technology Management Department
・Observe CE mark criteria, including handling RE directives
・Create Radio Act guidelines
・Currently systematically implementing responses to RE Directives on radio wave timepieces depending on long waves/GPS/BT A ・Handle responses to RE Directives on radio wave timepieces according to the plan for long waves/GPS/BT
Guideline 3: Engage in business practices that are fair, transparent, open to competition, and responsible.
CITIZEN WATCH
Q&Q Sales Department
Thoroughly abide by laws/regulations related to exports; observe guidelines from the trade control department in regard to new clients (maintain zero law/regulation violations) Reminded of compliance with relevant laws and regulations at division meetings B Continue giving reminders and pay attention to new incidents and new clients
CITIZEN FINEDEVICE ・Zero violation of laws and regulations
・Implement education
・Compliance with regulations and by-laws
・Zero violation of laws and regulations
・Invited an instructor from the CHD legal affairs office to hold seminars at five offices
(over 110 participants)
・Held internal audits and identified non-compliant areas which will be corrected
B ・Zero violation of laws and regulations
・Implement education
・Compliance with regulations and by-laws
CITIZEN WATCH
General Affairs Department
Participate in special prevention meetings and workshops (Tanashi District trainees) Attended the Tanashi District General Meeting; participated in workshops A Hold workshops to fill the responsibility as the one in charge of workshops in Tanashi District
CITIZEN FINEDEVICE ・Collaborate with governments including municipal offices (i.e. Crime Prevention Association and Safety Measures Division)
・Regularly conduct educational programs and maintain Basic external correspondence
・Participated in a seminar by the Saku Police Station on March 7th
・Undertook horizontal expansion within departments
B ・Participate in outside seminars; review methods for gathering information
CITIZEN WATCH Roll out the “Citizen Watch CSR Procurement Guideline” Group-wide ・Held explanatory meetings for controlling companies and independent operating companies to have corresponding guideline rolled out
・Held explanatory meetings for relevant company divisions to request the roll-out
A ・Put consolidated Citizen Group’s guideline into effect in April
・Coordinate with the General Affairs Division taking the helm
CITIZEN WATCH
Product Planning & Sales Department
Reassess trade relations with suppliers, conduct maintenance audit according to QCD and maintain friendly relations; also, explain the CSR Procurement Guideline to suppliers Completed improved standards/criteria for procurement, revised supplier assessment, and attended supplier meeting in China; the CSR Procurement Guideline was also explained to suppliers A Continue positive relations with suppliers
CITIZEN T.I.C. Goal: Rollout the CSR Procurement Guideline among suppliers Key Measure: Distribute the CSR Procurement Guideline and obtain documents of acceptance Distributed the Guideline to targeted 99 suppliers ; obtained the declaration forms from 44 suppliers and documents of acceptance from 55 suppliers, having resulted in reaching the goal A Going forward, when entering into a basic agreement, aim to receive a declaration form of agreement for the CSR Procurement Guideline
CITIZEN WATCH Environmental Management Department Check the status of conflict minerals use according to the EICC format ・Hadthe validity of the verification procedure assessed by a third-party reviewer, Bureau Veritas A ・Adjust the relevance with CSR procurement
Guideline 4: Respect human rights and diversity, and provide a safe and pleasant working environment.
CITIZEN WATCH Rotate executive candidates within the Group to cultivate global human resources Initiated the Group rotation to nurture the next-generation executives A Continue endeavors
CITIZEN WATCH
Quality Assurance Department
Execute the plan to boost capacity and check results ・Revised the capacity assessment list at the start/end of the fiscal year; conducted lectures within the division B Review the plan to boost capacity in the new organization starting in April, 2017
CITIZEN WATCH MANUFACTURING ・Achieve the QC exam passing rate of 85% among over 2,600 employees within the CWMJ Group
*Including the in-house level 4 exam
・Achieve the technical skills exam passing rate of 50% among over 1,000 employees within the CWMJ only
*Including the in-house business career and the technical skills exams
・Achieved 90% (2,676 employees within the CWMJ Group passed the QC exam)
・Achieved 53% (1,115 employees within CWMJ only passed the technical skills exam)
A 1) Launch in-house exams for job categories and pass on technologies/skills to next generations
2) Reassess and optimize in-house exams
・Review whether exams match current equipment and processing methods, etc.
CITIZEN WATCH Confirm contents of business trip applications (check whether destined countries are dangerous), thoroughly provide precautions during business trips, and strive for zero accidents by enforcing orders to return home as needed (continue achieving zero accident track record) As of now, have had no accidents involving employees, including employees stationed overseas; sent out overseas safety notifications twice A Continue promoting zero accident track record
CITIZEN LOGISTICS SERVICE Consolidate disaster prevention activities
*Create a disaster prevention manual and conduct regular disaster prevention drills
・Held regular disaster prevention committee meetings (monthly)
Started creating a disaster prevention manual
・Conducted disaster prevention drills (twice yearly)
B Complete and disseminate the disaster prevention manual
Guideline 5: Recognize the importance of environmental conservation, and take voluntary and proactive measures.
CITIZEN WATCH
Environmental Management Department
・Undergo a renewable audit for re-certification and meet the requirements for the amended ISO 14001
・Conduct Group’s internal audit and compliance audit
・Started using the unified manual that conforms to the amended ISO 14001
・Conducted the Group’s internal audit according to the unified manual
A ・Support building the CWMJ Group management system
・Undergo thetransition audit for ISO 14001: 2015
CITIZEN WATCH
Environmental Management Department
・Conduct environmental training for employees prior to overseas posting
・Environmental Performance Data: Shift from gathering to utilization (set specific reduction goals for environmental burden)
・Communicate information on overseas legislations
・Regularly conduct an overseas base survey
・Provided training for all employees to be posted overseas
・Demonstrating steady results on reduction plans for overseas bases
・Revised and communicatedinformation on overseas legislations every month
・Acquired ISOin CWMT and CPTH
・Conducted overseas the base survey twice
A ・Support GRT in preparing for ISO 14001 certification
TOKYO BIJUTSU Contribute to protecting forests and natural environments through less printing
・Become FSC certified
・Acquired FSC-COC certification B Proactively promote FSC certification
CITIZEN ELECTRONICS ・Install LED lighting in all companies (4,577 lights) Finalized the 2-year LED light plan at management level and in fiscal 2016, exchanged 1,549 fixtures with LED lights (out of 4,577 lights equivalent to 2,772 fixtures) B ・In the second-year of the plan, exchange remaining 1,223 fixtures
CITIZEN WATCH
Product Development Dept.
Streamline 3D contouring using a 3D digitizer Achieved a yearly outcome of 10 cases saving ¥ 6.9 M in value, and reduced electricity consumption by 3,637kw/year reaching yearly goals A Continue the activities held in fiscal 2016
MIYANO SERVICE ENGINEERING Improve operability, safety, and functionality of Yutora Completed safety checks on existing machines with modified parts; started production and shipping of Yutora for which safety measures were taken B ・Increase the sales of Yutora by advertising its enhanced safety, reduced energy consumption, and leveraged resource
CITIZEN SYSTEMS
JAPAN
Consolidate environmental research system
(unify product and parts management, and take backups)
・Centrally controlled environmental research data using the system
・Finished consolidating the rules related to outsourced manufactured products and secondary materials
B ・Partially disseminated the rules related to outsourced manufactured products and secondary materials
・Completed the transition from JAMP-AIS to chemSHERPA
Guideline 6: Manage and protect company assets in an appropriate manner.
CITIZEN WATCH
Q&Q Sales Department
Boost measures against counterfeit goods (continue active development of exposure in South China and start measures against counterfeit goods appearing on the Internet sales) Had nine exposed cases (total of 16,834 finished goods); implemented training for customs officers at the Guangzhou customs and the Ningbo customs B ・Continue on the offline exposure measures
・Monitor the online measures meanwhile the positive outcomes have been achieved
CITIZEN WATCH
Administration & Management Department
Strictly manage corporate information (from sales, planning, designing, to advertising) based on operation method stipulated by “Trade Secret Management” Managing corporate information based on the method for managing trade secrets B Continue with the management of trade secrets as in fiscal 2016
CITIZEN WATCH
Design
Department
Implement preliminary design research prior to product commercialization; move forward with design applications having a strong basis for obtaining rights; take care not to infringe on third-party intellectual property rights ・Submit design applications for highly original designs that are design assets A ・Continuously implement preliminary design research prior to product commercialization
・Continue to move forward with design applications having a strong basis for obtaining rights
・Promote development of original designs
CITIZEN FINEDEVICE ・Carry out sound operation based on regulations (fiscal 2016 survey; preparation to handle fiscal 2017 social insurance)
・Strengthen management areas (reexamine layout of Miyota Office)
Began consolidating the regulations in fiscal 2015 and implementing at practical levels in fiscal 2016;
Madeimprovements/corrections based upon internal audits during the implementation and had no trouble
A Plan to purchase a safe to be installed at the headquarters to exclusively and securely store My Number information during fiscal 2017
TOKYO BIJUTSU ・Carry out suitable implementation of PMS and continuous improvements
・Undergo the inspection for the 5th renewal of the P mark
Had P mark re-granted A Continue with the PMS implementation and improvement
CITIZEN MACHINERY SERVICE Thoroughly manage handling of blueprints
・Thoroughly manage Drawings in Tokorozawa
・Thoroughly manage externally obtained Drawings
・Executed management in accordance with the Trade Secrets Management
・Arranged Drawing management system in Tokorozawa
・Comply with the management method of entities providing Drawings/ tackle with all employees
Achievement: Consolidated the management system
B Need to continue working on increasing the level of understanding by members
CITIZEN PLAZA ・Understand the importance of information management Securely stored printed information with a lock on to manage during and after operating hours; practiced minimal management to prevent leaks B Need to take the next step in stricter information management as awareness on high confidentiality of information being handled has successfully increased
Guideline 7: Abstain from actions that would harm the company’s long-lasting values.
CITIZEN WATCH
Accounting Department
Observe payment due dates according to accounting regulations/manage payment terms, and correctly calculate necessary payments Continue to carefully check payment daily; to prepare for unforeseen incidents, made progress in laying a system in which multiple staff will be ready to respond to the situation. B ・Maintain the level of operation due to take-over; participate in lectures on the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors
CITIZEN WATCH Public & Investor Relationship Department ・Compile information on the summary of accounts announced each quarter (watch business) for each business and provide information (First half of the year) Collected and disclosed the information from each division on designated dates
(Second half of the year) Collected and disclosed the information as in the first half of the year although in line with becoming a holding company, the request came from the General Affairs Division
A Continue with the information gathering and disclosure as in fiscal 2016
Guideline 8: Strive to contribute to regional communities in which we operate.
CITIZEN PLAZA Actively provide school children with opportunities for workplace experience and off-campus learning, etc. Accepted 24 requests for off-campus learning—primarily skating and three requests for workplace experience at the bowling alley A Actively welcome matters that allow contribution to the local community
CITIZEN WATCH, CITIZEN WATCH MANUFACTURING Hold watch workshops Collaborated in the Tamarokuto Science Center “Watch Workshop;” 19 groups in workshops for adults and 72
participants in workshops for children
Collaborated in the Nishitokyo Citizens Festival “Watchmaking Workshop”
A Be cooperative as technicians and technical experts
CITIZEN WATCH,
CITIZEN WATCH MANUFACTURING
Accept interns from universities and provide instructions Held a two-week internship program for two university students studying science A Provide internship opportunities when requested
CITIZEN ELECTRONICS Involve every division to contribute to the community through cleanup and beautification activities, etc.
Plan/implement activities and energy-saving actions
(Target: At least 13 activities per year)
Had each division review, plan and execute cleanup activities in the vicinity of the company; participated in activities sponsored by outside organizations such as the city A ・Tackle the issues of creating awareness and all-employee involvement
・Refer to social contribution achievements for actual costs
TOKYO BIJUTSU Support cultural and art activities through sponsorship and volunteering Sponsored and volunteered in “Setouchi Triennale 2016”
(Six participants)
A Develop into company-wide activities
CITIZEN SYSTEMS ・Undertakevolunteer activities for the Jiangmen Marathon
・Undertake volunteer activities for the badminton competition sponsored by the China Association of Enterprises with Foreign Investment (CAEFI)
・Volunteered at the Jiangmen Marathon (November)
・Campaigned for self-supporting students in Jiangmen (December, 600RMB)
・Involved in CAEFI badminton competition (November)
A Continue participating in volunteering programs
CITIZEN MACHINERY ・Greet children during the traffic safety awareness period
・Cooperate in fund-raising activities
・Promote lending of parking lots for school events
・Ensure school routes are clear by removing snow
・Clean up by picking up trash and hold environmental beautification activities
・Accept worksite tours
・Participate in blood donation activities
・Participate in activities to protect the snijimiaeoides divinus, an endangered species
・Implemented in the first half of the year
・Participated in Red Feather Community Chest in October and 110th school anniversary fund-raising activities
・Cooperated in junior high school newcomer baseball competitions and basketball competitions (four times)
・Held seven days in total in November and January
・Held five days in November and December; cleaned fallen leaves once a month after January
・Held seven days in total in October, November, and February.
・71 participants on Jan. 20th
・Implemented in the first half of the year
A The Health and Safety Committee carried out trash cleanup, which was very well done