Materiality | Sustainability | ASKA Pharmaceutical Holdings Co., Ltd.

Rationale for identifying material issues
Material Issue Identification Process
Sustainability Management Key Agenda Items
KPIs and SDGs for Material Issues
Major Material Issue Initiatives Achievements

Rationale for identifying material issues

Since our birth in 1920 as a pioneer in the field of hormone preparations, we have taken an important mission directly related to life and health to heart and have made steady progress. In 2021, we shifted to a holding company structure and took a new step toward the next 100 years. In order to contribute to building a sustainable society by leveraging the knowledge and know-how about hormones that we have cultivated to date as a source of growth, we have identified 17 material issues that only we can achieve, at the same time as launching our ESG Committee in 2021.
(Reorganized into 11 in October 2023 / Reorganized into 6 in April 2025)

Material Issue Identification Process

STEP1: 2021

At ASKA Pharmaceutical Holdings, in order to achieve sustainable growth for each group company, representatives from each department (promotion officers) analyzed the current situation, along with associated opportunities and risks, gathered opinions from members, and proposed a total of 206 issues to the ESG promotion meeting.

The ESG Promotion Meeting summarized and classified the 206 issues proposed by the Committee of Managers for ESG Promotion and proposed the 15 issues that should be addressed with the highest priority to the ESG Committee.

"The ESG Committee interviewed external experts and identified 17" "material issues" "as the most important issues and 41 associated KPIs, taking into account various guidelines and norms such as the GRI Standards, the SDGs, the medium-term management plan, and the interests of stakeholders." In addition, taking into account the relationship with our business and the perspective of social contribution, we positioned "contribution to women's health" and "contribution to animal health," in particular, where we can demonstrate our strengths, as our characteristic material issues, and after reporting to the Board of Directors, we instructed the entire company to start initiatives in October 2021.

STEP2: 2023

Approximately 2 years after STEP1, the ideal number of material issues/KPI items, specific targets and goals were set. In addition, as a result of discussions on reorganization at the Committee of Managers for ESG Promotion the purpose of understanding stakeholders, in-house penetration, and raising awareness, the reorganization into 11 material issues and 48 KPIs was proposed to the ESG Promotion Meeting.

The ESG Promotion Meeting reviewed the content and proposed a reorganization plan consisting of 11 material issues and 48 KPIs to the ESG Committee

The ESG Committee confirmed all the proposals made by the ESG Promotion Meeting, reported them to the Board of Directors, and then instructed the entire company to start implementing measures in October 2023.

STEP3: 2025

In the process of implementing STEP2, the Committee of Managers for ESG Promotion reflected many of the improvement proposals from members and proceeded with the review with efficiency and consolidation in mind. In addition, "human rights," which are essential for the sustainable growth of the company and the building of trust, were newly added, and finally, six new material issues proposals were made.

At the ESG Promotion Meeting, the Company proposed six material issues to the ESG Committee, taking into account the following matters, which have been particularly pointed out in communication with stakeholders.
1. Priority awareness
2. Taking advantage of the features of ASKA
3. Qualitative target ratio improvement

The ESG Committee deliberated and decided on the proposals of the ESG Promotion Committee, reported them to the Board, and then instructed the entire company to start initiatives from April in 2025.

Sustainability Management Key Agenda Items

The Company has identified 6 "materialities" in terms of relevance to our business and contribution to society. In particular, the Company believes that "contributing to women's health and animal health" is a materiality in which we can play to our strengths. The entire group will work on each item and contribute to the achievement of the SDGs.

6 material issues identified

KPIs and SDGs for Material Issues

ESG	Materiality	KPI
E	Promotion of Environmental Management	①CO₂ emissions reduction: Company-wide target "60% reduction compared to FY2013 (by FY2035)" / Domestic production site (Iwaki Factory) target "60% reduction compared to FY2013 (by FY2030)" ②Reduction of total waste and maintaining/improving recycling rate at 90% or higher: Plastic recycling rate of 65% or higher (by FY2030) ③Environmentally conscious business development ④Reduction of environmentally hazardous substance emissions (mitigation of nitrogen load through the spread of low-protein feed) ⑤Promotion of biodiversity ⑥Thorough supply chain management and preferential purchase of environmentally friendly products *Limited to domestic business activities.
S	Development of Diverse Human Resources for Enhancing Corporate Value	①Promotion of autonomous learning (20 hours/person/year) ②Promotion of diverse work styles: remote work, location-limited, shorter working hours, maintaining high & semi-high work engagement ratio (40% or higher) ③Promotion of women’s participation (target for FY2029): Female managers (20%) / Female managerial candidates (30%) ④Support for balancing work and life (diversity): Work support allowance, men’s childcare leave (average 30 days or more) ⑤Annual paid leave utilization rate of 80.0% or higher (company-wide average) ⑥Maintaining ICT environment for smooth operations inside and outside the company, ensuring flexible working styles and productivity improvement ⑦Fostering DX talent to improve work process efficiency, thereby enhancing organizational productivity and improving employees’ work-life balance
	Contributing to Women’s Health and Animal Health	①Contribution to healthcare through dissemination of accurate knowledge and disease awareness in specialty areas (obstetrics/gynecology, thyroid) ②Initiatives for sexual education of young people, and information dissemination on pregnancy, childbirth, and parenting ③Promotion of animal welfare ④Development and provision of useful products for maintaining the health of companion animals and livestock ⑤Promotion of academic activities on veterinary pharmaceuticals and related diseases (especially reproductive/endocrine diseases) ⑥Promotion of in-house research themes and strengthening of alliance activities
	Stable Supply of High-Quality Products and Proper Information Provision	①Strengthening value chain management ②Compliance with relevant laws and regulations ③Compliance with guidelines on promotional activities and strengthening training on information tools for MRs, etc. ④Prompt provision of the latest information via the website ⑤Promotion of awareness activities for proper use among veterinary pharmaceutical users (veterinarians, veterinary nurses, livestock producers, companion animal owners)
	Respect for Human Rights	①Efforts toward implementing human rights due diligence based on the Human Rights Policy ②Employee education and awareness-raising for proper understanding of human rights
G	Strengthening Governance	①Fostering a corporate culture that respects sound business ethics, and appropriate disclosure and explanation of financial and non-financial information ②Ensuring substantive equality of shareholders ③Social contribution activities leading to solutions to social issues ④Constructive dialogue with stakeholders ⑤Promotion of compliance system centered on the Group Compliance Promotion Committee (continuous implementation of preventive measures against serious incidents, etc.)

Major Material Issue Initiatives Achievements

We present the progress and achievements on the KPIs of material issues that are of particular interest to our stakeholders.
Through the ESG Committee, we continuously monitor the progress of initiatives on material issues and work toward further improvement.

E: Promotion of Environmental Management　　*Limited to domestic business activities
Corresponding SDGs

KPI	FY2025 First Half Progress
CO₂ Emissions Reduction: Companywide target – 60% reduction vs FY2013 (by FY2035) Target at domestic production site (Iwaki Factory): 60% reduction vs FY2013 (by FY2030)	◎ Initiatives at Iwaki Factory (1) Introduction of solar power generation under PPA (2) Installation of heat pumps (3) Procurement of CO₂-free electricity (4) Commencement of operations at Community Center “arca” (5) Completion of LED installation throughout the 3rd Formulation Building ◎ At the companywide Energy Management Meeting, both annual and medium-to-long-term targets were reviewed and confirmed. (1) Annual target: Reduce energy consumption intensity by 1% or more year-on-year. (2) Medium- to long-term target: Reduce CO₂ emissions by 46% compared with FY2013 by FY2030. (3) Medium- to long-term target: Achieve a ratio of 50% or higher for non-fossil electricity in total electricity use by FY2030. ◎ For electricity equivalent to 836,753 kWh used at the head office building in FY2024, obtained FIT Non-Fossil Certificates and Renewable Energy Certificates from the JPEX market in May 2025 (CO₂ emissions reduced by 357 t-CO₂).
Reduction of Total Waste and Maintenance/Improvement of Recycling Rate of 90% or Higher: Waste plastic recycling rate of 65% or higher (by FY2030)	◎ Initiatives at Iwaki Factory (1) Total waste volume: 145 t (FY2024) 42 t (FY2025 Q1), 46 t (FY2025 Q2), total for the first half of FY2025: 88 t (of which 84 t recycled, 4 t final disposal) (2) Recycling rate: FY2025 Q1: 95%, Q2: 96%, first half: 96% ◎ ASW activities: Reconfirmed waste sorting, reduction, and recycling measures at the ASW Leaders’ Meeting. ◎ Initiatives at Head Office (1) Continued efforts to prevent misprints through authentication-enabled multifunction printers, promote paperless operations, and enforce waste separation. Continued reuse of stationery and envelopes. (2) Continued collection of reusable paper from office paper waste.
Environmentally Conscious Business Operations	◎ Continued compliance with the “Environmental Conservation Agreement” concluded with Fujisawa City and Kamakura City to maintain our environmental management framework. ◎ At the Shonan Research Institute, prioritized introduction of non-CFC equipment for new and renewed installations, and purchased environmentally friendly office supplies. ◎ Initiatives at Iwaki Factory: (1) Full-scale operation of ISO 14001 Environmental Management System began in June. (2) Participated in the Iwaki City “Adopt Program” as part of local volunteer activities. (3) Reported monthly monitoring results to the Environmental Monitoring Center under the Iwaki City Pollution Prevention Agreement, which imposes stricter standards than national regulations. (4) Participated in the “Iwaki Carbon Neutral Human Resource Development Consortium.” ◎ Initiatives by the Supply Chain Management Department: Began examining the replacement of packaging materials (bottle and cap) with biomass-based materials. ◎ Participated in the “28th Shonan International Village Meguri-no-Mori Tree Planting Festival” on May 11 (11 employees joined) to enhance employees’ environmental literacy.
Reduction of Environmentally Harmful Substances (Reduction of Nitrogen Load through Promotion of Low-Protein Feed)	◎ Initiatives in Animal Health Business (1) Contributed to protein reduction in compound feed through the promotion of L-Isoleucine. (2) Contributed to farmland conservation through the sale of L-Lysine and other feed-use amino acids.
Promotion of Biodiversity	◎ Green area management of the former Kawasaki site (under company management): (1) Conducted monthly inspections and secured perimeter access routes. (2) Implemented heavy pruning of tall trees to prevent damage from falling trees and to ensure safety of visitors and power lines. (3) Conducted thinning of bamboo groves to allow sunlight penetration and protect steep slopes by controlling undergrowth. (4) Maintained good relations with neighboring communities through appropriate site management and timely mowing. ◎ Significantly improved weed control methods by shifting from post-growth mowing to the installation of anti-weed sheets (plus five other measures). ◎ Expressed support for the TNFD recommendations, joined the TNFD Forum, and began disclosures aligned with the TNFD framework. ◎ Distributed companywide training videos on biodiversity as part of the 10th AEN in April 2025 to enhance employees’ understanding of biodiversity.
Thorough Supply Chain Management and Preferential Procurement of Environmentally Friendly Products	◎ Initiatives by the Supply Chain Management Department: (1) Launched the Supply Chain Checklist (including CO₂ emissions status). (2) Updated the Supply Chain web page. (3) Developed an Environmental Packaging Assessment Sheet to establish priorities with consideration of cost balance. ◎ Promoted green purchasing of stationery and office supplies at the head office: Green product purchase ratio: 63% (April–September 2025) ◎ Clarified the position of supply chain management in the companywide value chain mapping, with approval from the ESG Committee and the Responsible Officers’ Meeting.

S: Development of Diverse Talent to Enhance Corporate Value
Corresponding SDGs

KPI	Progress Report (First Half of FY2025)
Promoting Autonomous Learning (20 hours per employee per year)	◎ Average learning hours per regular employee: 11.5 hours (as of the end of September) ◎ Initiatives to encourage self-development: (1) Conducted training for new employees on the use of Udemy and flier. (2) Promoted the use of Udemy Business and flier through internal communications (3 Udemy News issues and 3 flier News issues). (3) Offered elective training programs to provide autonomous learning opportunities (4 programs with 39 participants in total). ◎ Promoted independent learning initiatives in each department, including GCP training, English and Chinese language skill enhancement, and leadership development.
Promoting Diverse Work Styles: Remote Work, Location-Specific Roles, Shortened Working Hours Target Work Engagement Ratio: 40% or higher	◎ Respected individual work–life balance by allowing employees to freely choose between on-site and remote work. ◎ As of the end of September: 5 employees under the Regional MR Employee System and 5 under the Remote Work System; both systems were revised in April 2025. ◎ Six employees utilized the short working hour system (mainly returnees from childcare leave), enabling flexible work arrangements according to family circumstances.
Promoting Women’s Empowerment (FY2029 Targets): Ratio of Female Managers: 20% / Ratio of Female Manager Candidates: 30%	◎ Held in-house roundtable discussions to share views and experiences of employees balancing childcare and work, alongside childcare leave programs exceeding legal standards. ◎ Conducted regular D&I training programs and enhanced the work environment to support women’s continuous career development through life events, resulting in an increase in the ratio of female managers to 14.1% (FY2020: 6.5%).
Initiatives for Work–Life Balance (Diversity): Work Support Incentive / Average Paternity Leave of 30 Days or More	◎ Operated and promoted the “Work Support Incentive System,” compensating employees who supported the workload of colleagues on leave (58 employees supported 17 absentees). ◎ Established a dedicated consultation desk and internal portal to alleviate concerns regarding long-term childcare leave. Promoted paternity leave, resulting in an increase in average leave days (First Half of FY2025: 31.2 days; FY2024: 16.28 days). ◎ Paternity leave acquisition rate: 100% (10 male employees took leave for 8 childbirths). Seven employees took more than one month of leave, with guidance provided to all managers to encourage and facilitate leave acquisition (100% implementation).
Annual Paid Leave Utilization Rate: 80% or Higher (Company-Wide Average)	◎ Annual paid leave utilization rate: 44.7% (Managers: 41.6%, Staff: 46.3%, as of the end of September). Communicated company-wide the FY2025 target of achieving 80% or higher utilization as part of workstyle guidelines.
Maintaining an Effective ICT Environment to Facilitate Flexible Work and Enhance Productivity	◎ Supply Chain Management Department conducted “Planner” study sessions based on feedback from DX promotion activities. ◎ Network environment renewal, scheduled for activation in the second half, is expected to enhance access speed and security. Improved iPhone communication performance will also strengthen tethering connections.
Developing Digital Transformation (DX) Talent to Improve Operational Efficiency, Organizational Productivity, and Work–Life Balance	◎ Introduced a training program for new employees utilizing generative AI to learn about the company’s history and business development, fostering a foundation for DX capabilities. ◎ Provided internal education on AI/RPA and related technologies, disseminating information to strengthen digital literacy and promote DX talent development, thereby enhancing productivity and operational efficiency.

S: Contributing to Women’s Health and Animal Health
Relevant SDGs

KPI	Progress Report for the First Half of FY2025
Contribution to Healthcare through Disease Awareness and Dissemination of Accurate Knowledge in Specialty Areas (Obstetrics & Gynecology, Thyroid Disorders)	◎Endocrinology Business Promotion Office: Published an article on thyroid disease awareness in the April–May issue of Metropolitana, an information magazine by Sankei Shimbun. Conducted a web seminar for municipal health promotion officers on women’s life stage-specific health issues, focusing on female and thyroid hormones, among other initiatives. ◎Shonan CMC: Progressed development of three gynecology products toward market launch, including obtaining approval for LF111 (Sulinda Tablets 28). ◎Sales Division: Provided appropriate usage information through national and regional seminars on topics such as hepatic encephalopathy and contraception (15 national lectures, 41 regional sessions, 13 or more co-sponsored seminars). ◎Held the ASKA Media Seminar to promote awareness and understanding of new contraceptive options, reaching 54 media representatives and investors, and featured in publications such as Yakujinippo, Answers News, Iji Shinpo, and Mizuho Securities reports. ◎Hosted the “Mint Meeting – Voices that Empower Women” on June 25, engaging approximately 50 women in their 20s–30s to share accurate information on women’s health and the importance of gynecological consultation.
Initiatives for Providing Information on Sex Education and Reproductive Health from Adolescence through Childrearing	◎Exhibited informational booklets on contraception and emergency contraception at “Seminars on Contraception and STI Prevention for Educators” (2 events, approx. 300 participants). ◎Added new content on contraception and preconception care to the “Mint⁺ Teens” website, and continued outreach to younger audiences via 27 Instagram posts. ◎Distributed 170,040 copies of the supplementary educational booklet “What High School Students Should Know About Sexual Health” free of charge to 411 high schools across Japan.
Promotion of Animal Welfare	◎Shonan Research Institute initiatives: (1) Published ethical considerations for research on the corporate website. (2) Conducted animal experiments in compliance with in-house regulations and Shonan iPark Animal Experiment Rules, within AAALAC-accredited facilities. (3) Participated in the Shonan iPark Animal Memorial Service held on September 11. ◎Contributed to animal welfare through the development, manufacture, and sale of veterinary pharmaceuticals, feed additives, and supplements.
Development and Provision of Products Contributing to the Health of Companion and Livestock Animals	◎Submitted an application for manufacturing and marketing approval of an endocrine drug for dogs. ◎Obtained approvals and made necessary changes to ensure a stable supply of products for companion and livestock animals.
Promotion of Academic Activities Related to Veterinary Medicines and Associated Diseases (Especially Reproductive and Endocrine Disorders)	◎Produced an educational video on Cushing’s syndrome associated with Trilostane Tablets “ASKA,” featuring academic experts.
Promotion of In-house Research Themes and Strengthening of Alliance Activities	◎Shonan Research Institute initiatives: (1) Actively leveraged open innovation to explore new research areas. (2) Introduced foundational drug discovery technologies targeting ion channels. (3) Conducted a public call for joint drug discovery research targeting academic and public-sector researchers in Japan. ◎International Business Division: Promoted the search for new potential partners in Southeast Asia.

Materiality