< PreviousNIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 3736 CHAPTER 4 NIPSEA’S FOCUS People Championing Employees as Our Competitive Advantage Our employees are our greatest assets - key to our long-term growth and progress. We seek to attract and retain the best talent, readily investing in talent attraction and development to equip our workforce with skills and knowledge to remain competitive in today’s fast-paced society. A key priority is also to nurture a supportive work environment that is inclusive and collaborative, with the well-being and safety of employees as a core focus. Innovating For the Good of the Region 2019 has been a year of sustainability action for Nippon Paint Hong Kong. Operating at the heart of Asia Pacific, we strive to continue innovating solutions that bring value to the region as a whole. Combatting the spread of dengue together Nippon Paint Hong Kong developed the Nippon Paint MozzieGuard as part of the city’s bid to fight the spread of dengue. The specially formulated coating uses an innovative technology that encapsulates insecticide in a paint polymer, such that only the Aedes aegypti mosquito is susceptible to the active ingredient in the insecticide. The paint formula also has anti-fungal and anti-mould properties, preventing bacteria growth on wall surfaces. Today, the paint is also a certified product under Singapore’s National Environment Agency (NEA) – the citystate’s public organisation responsible for ensuring a clean and green environment, as part of the nation’s dengue and Zika prevention move towards an Aedes mosquito-free community. Another innovation by Nippon Paint Hong Kong is the Nippon Paint Kids Wood. A first-of-its-type formula developed specially for children’s rooms, it features Formaldehyde Abatement as a core technology, which makes the paint capable of purifying harmful formaldehyde in the air and turning it into water. An odourless paint with anti-stain properties, it brightens the living space of children for a healthy and safe up-bringing. Improving safety at home through scienceNIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 3938 CHAPTER 4 NIPSEA’S FOCUS At NIPSEA Group, we recognise that in order to create new value for the better good through our business activities, it is essential to invest in our people. We seek to provide an environment that attracts and retains talent, where individuals can achieve their full potential and have their personal well-being taken care of. The following are three key areas of people priorities which NIPSEA Group emphasizes on in shaping the workplace of choice. *Director level and above 15.48% Proportion of senior management* hired from the local community Non-local HiresLocal Hires 84.52% Putting People at the Heart of Our Value Creation Journey NIPSEA Group maintains a diverse workforce comprising different genders, generations, nationalities, and expertise across regions. As of FY2019, the Group’s new hire rate was 18.53%. Our employment strategies align closely with regulatory requirements set by local authorities. 1. Hiring Local: We believe in hiring local talents across the markets that we are present in 2. Focus on Futures: Recruit and foster diverse talents with the best skills and expertise 3. Young Talent: We advocate for the grooming of a robust pool of young talent The local talent pool has always been a key driver in charting our way forward in the local markets for growth and competitive advantage. As of FY2019, more than 80% of our senior management across our 18 countries are local hires. This signals our commitment to the advancement of the local economy and its people. Advocating Fair Employment Practices In creating a supportive work environment, we offer a wide range of employee benefits during the term of employment. These include: • Life insurance • Medical insurance • Paid parental leave for both genders • Pension provision • Reimbursements for expenses such as meals and transport In the event of organisational changes that affect employees, policies outlining adequate preparatory measures are in place. A period of 1-3 months tender notice is enforced, depending on the job level of the employee. Higher level positions will require a longer notice period. The rule is also applied in cases that concern a collective bargaining agreement involving trade unions. As of FY2019, our Group’s turnover rate was 17.41%. Pursuing Continuous Training & Education Advocating Fair Employment Practices Prioritizing Occupational Health & Safety To build a skilled and capable workforce, we offer our employees a diverse range of training and educational programmes focused on personal effectiveness, leadership, and functional skills across the different job levels to support NIPSEA Group’s strategic priorities and business needs. In FY2019, NIPSEA Group accorded a total of 266,389 hours of training for our workforce 1 Number of employees who have returned to and remained at work for at least one financial year, after the end of parental leave Pursuing Continuous Training & Education Average training hours per year, per employee categoryAverage training hours per year, per gender category Training Hours 025201510 18.55 hours 15.15 hours 5 ManagementExecutives and SupervisorsRank and FileMaleFemale 10.20 hours 24.70 hours 12.59 hours In FY2019, the return to work rate of employees that took parental leave was 97.34% and 100% for females and males respectively, while the retention rate 1 of employees that took parental leave was 95.08% and 94.53% for females and males respectively. Leadership Advancement • Managerial Thinking • Decision-Making • Conflict Resolution Soft Skills Development • Effective Communication • Teamwork • Problem Solving Technical Skills Training • SAP/SMP Knowledge • Proficiency in Machinery Equipment • R&D/Technical Skills 123NIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 4140 CHAPTER 4 NIPSEA’S FOCUS Employee safety is NIPSEA Group’s number one priority and we place a lot of emphasis on the physical and mental well-being of our people. We achieve this through the enforcement of safe behaviours and the provision of good health and working conditions under local laws and regulations, and the Group’s Quality, Environment, Safety and Health (QESH) protocol. Occupational health and safety committees oversee the management of workplace safety, chaired directly by Senior management. Preventing Work-Related Incidents Our occupational health and safety (OHS) measures focus on the prevention of safety and hygiene hazards such as work-related injuries or ill health that could potentially arise from our manufacturing and operational activities such as production, chemical use & storage, formulation and manufacture of paints and allied products in factories. Depending on the regions, we adhere to a range of international safety management systems to facilitate compliance and continuous improvement of safety standards. Objectives and targets are planned and tracked in a regional database that also houses industry best practices and suggested solutions to common issues. Grievance mechanisms are in line with the requirements of local trade unions, and conveyed to staff through hand- books and internal communication procedures. OHSAS 18001 ISO 45001:2018 FY2019 For all employees (excluding contractors) Contractors only Number of recordable work-related injuries 10920 Rate of recordable work-related injuries/200,000 hours worked 0.710.57 Rate of recordable work-related injuries/1,000,000 hours worked 3.532.83 2 Days away from work, restricted work or transfer to another job, medical treatment beyond first aid, or loss of consciousness; or significant injury or ill health diagnosed by a physician or other licensed healthcare professional, even if it does not result in death Prioritizing Occupational Health & Safety To keep employees up to date on safety precautions, safety training workshops and briefings on subject matters such as chemical & PPE safety, machine use, or techniques that include life-saving and occupational first aid, are taught by internal or external experts. A tailored training calendar is developed yearly per site based on a competency assessment, specific to work scope activities, site hazards, and safety standards. At Nippon Paint India there is an occupational health centre (OHC) present with trained first- aid providers armed with a first-aid box and a company ambulance to provide immediate assistance in the case of emergencies. Emergency eye-wash and showers are also maintained across all factories at NIPSEA Group. Taking Proactive Corrective Action If a case on a potential safety hazard is filed, the OHS team will carry out an investigation on the reported incident. Employees who report the incident will not be penalised. Findings will be shared at management meetings and corrective action will be taken if necessary to prevent recurrences. Any incident or accidents encountered are openly shared across the Group at monthly safety committee and management meetings, and any corrective measures will be communicated at bi-annual town-halls or rolled out in the form of worker training and development. As of FY2019, the number of cases of recordable work- related ill health 2 at NIPSEA Group stands at five. We track and monitor performance, operational control and compliance to standards through various methods. Prioritizing Occupational Health & Safety Internal Audits A corporate-guided NIPSEA Group safety diagnosis is carried out annually. Third-Party Surveillance Independent third-party audit companies such as SGS are engaged to audit our safety protocols annually. Risk Assessments Identification of significant risks and opportunities for accident prevention, compliance obligations and continual improvements. Monitoring Activities This involves hazard assessments, evaluations, line and professional self-assessments, peer reviews, and third-party validation testing. Control Procedures Processes are assessed and remarks on key measurements, process owners, control points, validation testing, and action plans for any corrective actions are recorded in reports.NIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 4342 CHAPTER 4 NIPSEA’S FOCUS NIPSEA Group takes care of its people by implementing Employee Total Wellness programs that focus on developing employees mentally, physically, and professionally. In addition to e-courses and workshops that stimulate mental and physical activity, the Group also supports the formation of recreational clubs that allow employees to enjoy a wide range activities together, from sporting events to arts, music and CSR activities. There is an in-house clinic at Nippon Paint Malaysia where periodic medical screenings are carried out for employees handling hazardous materials or who are working in an environment that poses a higher health risk. Bringing Wellness to Employees Building and Enabling Better Communities NIPSEA Group seeks to create change that matters. We will maximise tangible social impact by advancing education and empowering future generations to realise their potential, as we believe that the development of youth is key to sustainable growth for our future. Beyond philanthropy and charity, we are committed to mobilizing our assets and resources to best serve the interests of these communities. Community44 CHAPTER 4 NIPSEA’S FOCUS NIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 45 children’s learning competence, and how to improve it. Backed by scientific research, we launched the first ever colour catalogues in the country titled “The Effect of Colour on Children” and “The Use of Colour in Schools”, for children’s rooms and classes respectively. These are the first-ever nation-backed colour guides in shaping conversations on how colours affect the learning capabilities of children and adolescents. As a company that is focused on Asia Pacific, we aim to grow alongside it. In doing so, we do the best that we can in providing children with access to education, and safe and conducive learning environments that enable them to achieve sustained advancement for their future. Lighting up education for future generations 232 rural children have been provided with essential food and housing needs Elevating Learning for Future Generations In June 2018, Nippon Paint Vietnam began an initiative called Education Light that provided basic essentials such as food and housing for students in need, in a bid to allow students to focus on learning without having to worry about the essentials of life. With the support of partner companies, we raised funds to provide nutritious meals to students, as well as engaged local architects to build one new school and two housing dormitories. In addition, we also developed art capabilities in children through art lessons. Leveraging our expertise in colour to boost learning capabilities 250 school administrators from 125 schools have undergone our colour training classes 15 kindergartens have re- painted their classrooms according to our colour palettes On top of providing financial support, we leverage our expertise in colours and paints to design conducive and ideal learning environments for children. In 2017, we embarked on a collaborative study titled Colour Effect Project with the Ministry of National Education and renowned psychologist Ayben Ertem, to further understand the psychological effects of colour on In 2017, Nippon Paint China established the “ China Students Education Support Award” – a teaching support award as part of its flagship “Color, Way of Love” corporate social responsibility (CSR) project. It aims to support the country’s national strategies in elevating the nation’s poverty line, while building a deeper understanding of its diverse cultural heritage amongst its citizens, to promote both economic and educational development. Through the programme, we provide financial backing for university students to support communities in China via two tracks: 1) educate children and teachers with updated curriculum, and 2) conduct research to better understand traditional village architecture and cultural heritage to develop economic plans that embrace the area’s unique culture and values. The project sets up six different awards for college students, with funding ranging from 285 USD (2,000 RMB) to 1,428 USD (10,000 RMB). From 2017 to 2019, students ventured into more than 197 cities in 31 provinces to support education, and headed into 328 villages and towns to conduct detailed studies on 322 traditional buildings. In addition, the project also provided support and funds in upgrading the exteriors of rural schools and the development of art classrooms within. 11.86mil lives in China have benefitted from our support through both tracks > 98,000 students and teachers in areas have improve their knowledge capabilities from updated curriculum Scaling Economic Prosperity through Education 46 CHAPTER 4 NIPSEA’S FOCUS NIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 47 We believe in being a business that looks beyond mere profitability. As such, we aim to empower underserved communities by equipping them with skills and knowledge, and instilling confidence and ownership to overcome challenges Protégé in the making 2,004 underserved students groomed as future talent To achieve the best outcomes for vulnerable communities in Thailand, we introduce career-launching jobs for young people. Through a programme called Protégé , Nippon Paint Thailand SSC and Thailand’s Department of Skills Development inked a three year Memorandum of Understanding (MoU) in July 2015 to 197 NP Thailand painters. We further expanded the reach of the programme to include 78 of our key customers as allies of the programme to advance our skills training agenda. As a result of the programme, we are able to spot untapped talent, which is crucial in building NIPSEA Group’s future capabilities. Inspiring imaginations for the future 88 global artists from countries such as the US, France, Italy, Argentina, amongst others 120 inspiring murals painted across rural areas in China Generated 58,000 discussions about the importance of imagination through art, amongst the community and key education policy makers While knowledge building is important for children, stimulating their imagination and creativity is just as crucial. It supports their confidence to form new ideas about the world, and more importantly, it creates in them hopes and aspirations for the future. Through the launch of Nippon Paint China’s Color, Way of Love Art+ Project in 2016, we aimed to do just that. The project sees the participation of global artists creating meaningful mural paintings that speak of dreams and ambitions for the future, in rural schools across major cities and suburbs across China. Empowering Underserved Communities match students with our expert Painters, in grooming them as apprentices even before graduation. In September 2018, we renewed the MoU for another three years. We provide all the necessary materials and equipment on top of training under the guidance of 367,838 aspiring young designers engaged from 1,244 schools globally 35,300 submissions received since the programme’s inception 39 renowned global design associations partnered with Asia Young Designer Awards (AYDA) was first launched in 2008 as part of our vision to nurture the future generation of talents in the interior design and architectural landscape. A decade later, AYDA has evolved from a design competition to become a platform that offers opportunities for young talents to engage and gain first-hand knowledge and exposure through personalised coaching and skills- building workshops by renowned industry practitioners. It has also extended its reach across 15 countries and regions in Asia Pacific. Every year, we continue to receive an increased number of award submissions. In 2019, we received 7,816 submissions, a 6% increase from 2018. ‘ AYDA is a powerful combination of skills development and opportunity- matching for aspiring young designers. It has helped me open doors to experiences which I only once dreamed of having. ‘ Tanay Narendra Bothara, Asia Young Designer of the Year 2018/19 (Architectural Category) This year, we enhanced the programme through the following initiatives to further develop and strengthen the programme. This includes: • Increasing the credibility of AYDA through the formation of an AYDA Council comprising of experts and professionals in the industry • Raising the profile of AYDA by establishing a first-ever global partnership with Harvard GSD to offer participants opportunities to attend its prestigious 6-week Design Discovery Program, as well as set-up a 23mil JPY (217,000 USD) Gennosuke Obata Fellowship Fund which provides financial aid to Harvard University’s GSD students from Asian countries, to help attract and support talented design scholars from the region • Boosting global and regional team synergy by introducing a regional team and alignment meetings Building and Nurturing Talent Pipelines Globally48 CHAPTER 4 NIPSEA’S FOCUS NIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 49 We recognise that a tightly-knit social fabric is a key pathway to any nation’s or organisation’s success. We thus aspire to act as an enabler to build harmonious communities and improve social resilience. Providing safe spaces for bonding >12,000 members of the community enjoy the shared facilities 3,000 children now have safe spaces to play in With our initiative titled SayangiRumahku (translating to “love my home”), Nippon Paint Malaysia wanted to instill a sense of pride and belonging to a community amongst the B40 (the country’s classification of households whose income level is considered as the bottom 40% of the nation), by improving their living conditions through the creation of common spaces around their home environment. In 2019, we collaborated with a local artist and designer to design safe yet visually- appealing communal spaces such as sitting areas and activity courts, spanning across 6,793sqft. Celebrating community with colour >3.4mil Gapura residents bonded across a shared activity in Indonesia since 2016 14,019 Gapuras painted in 2019 alone In celebration of Indonesia’s Independence Day, Nippon Indonesia wanted to preserve the culture of communal work known as “gotong royong”, which involves the mutual cooperation of inhabitants within the Building Colourful and Connected Communities neighbourhoods to spruce up the surrounding environment, as a way to increase the sense of kinship within the communities. As such, we launched a yearly initiative called Gapura Merah Putih , which involves painting and decorating Gapuras - iconic arches across all of Indonesia, each unique to its location. Every year since 2016, in true testament of “gotong royong”, Nippon Paint Indonesia employees willingly volunteer for tasks that include rallying the community to nominate the Gapura to be painted, all the way to distributing and painting the Gapuras alongside the community. An initiative that has truly embedded itself as part of the local communities’ celebratory practice, all stakeholder groups of the community look forward to the yearly activity. Female participation in a workforce in India is lower as compared to any other country. This makes it even harder for women in rural areas to make a living on their own as they lack the employable skills, not to mention the societal stigma of women holding a job. 24 batches of trainee intake 420 professional Indian women painters in the rural area of Tamil Nadu nShakti was launched in April 2018 in a rural Kancheepuram village to empower unskilled women with technical skills in basic construction and professional painting, to be capable of earning a livelihood for themselves and their families. Women between the ages of 18 and 35 are taken in as trainees in PROceed Training Academy under the tutelage of Nippon India’s expert Painters to acquire knowledge such as types of surfaces, paint characteristics, and ‘ nShakti has been a life-changing experience for me. Using the professional skills acquired, I have begun to establish personal business connections, to one day, start my own small paint dealership. ’ Advancing Employment for Women paint application. Many have since gone on to start their own painting service companies, while others have secured jobs within the construction industry. Moving forward, we aim to continue developing this rural network of painters and extend this initiative into less privileged areas in other regional markets. Rajkumari (from Myladadurai, Tamil Nadu), nShakti participantChapter 5 Appendix NIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 5150 CHAPTER 5 APPENDIX52 CHAPTER 5 APPENDIX Economic Performance 2019 ESG Data NIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 53 NPX GroupDescriptionMetric Greater China Group Korea Group Malaysia Group Thailand Group India Group Singapore Group Others NIPSEA Group GRI 201Economic Performance 201-1Direct economic value generated and distributed Direct Economic Value Generated: Revenues (USD’mil)USDNot applicable – calculated at the NIPSEA Group level4,068 Economic Value Distributed (USD’mil)USDNot applicable – calculated at the NIPSEA Group level3,516 Economic Value Retained (USD’mil)USDNot applicable – calculated at the NIPSEA Group level552 201-3 Defined benefit plan obligations and other retirement plans Mention the estimated value of the resources (USD’mil) USDNot applicable – calculated at the NIPSEA Group level27 201-4Financial assistance received from governmentFinancial assistance from government (USD’mil)USDNot applicable – calculated at the NIPSEA Group level14 GRI 202Market Presence 202-2 Proportion of senior management hired from the local community Number of senior managers at significant location of operation hired from local community (%) %78% 75%98%92%86%80%100% 85% Total number of senior management at significant location of operation –127 12471271519 239 Number of senior managers at significant location of operation hired from local community –99 9461161219 202 GRI 203Indirect Economic Impacts 203-1 Infrastructure investments and services supported Qualitative information not available in this tableRefer to Chapter 4: Community – Building and Nurturing Talent Pipelines Globally for details54 CHAPTER 5 APPENDIX Environment Performance 2019 ESG Data NIPSEA LFG SUSTAINABILITY REPORT 2019 PAINTING THE WAY FORWARD BEYOND COATINGS. BEYOND ASIA 55 NPX GroupDescriptionMetric Greater China Group Korea Group Malaysia Group Thailand GroupIndia Group Singapore Group Others NIPSEA Group GRI 301Materials 301-1 Materials used by weight or volume Non-renewable material usedton3,055,24317,4651,178,80542,54155,83571,319N.A.4,421,207 Renewable material usedton729,38522,152195,5516,50613,93355,505N.A.1,023,033 301-2 Recycled input materials used Qualitative information not available in this tableRefer to Chapter 4: Environment – Sustainable Sourcing of Materials for details GRI 302Energy 302-1 Energy consumption within the organization Total energy consumptionGJ569,89012,232196,23085,08019,28323,333N.A.906,048 Non-renewable energyGJ186,1393,16195,22617,4782,1912,098N.A.306,293 Renewable energyGJN.A.N.A.N.A.N.A.2,017N.A.N.A.2,017 Electricity consumption in kWhGJ383,7519,071101,00467,60215,07521,235N.A.597,738 302-3Energy intensity Energy intensity ratio for the organizationMJ/ton1824394202,198262252N.A.236 Production output of the year in tonton3,134,61527,873467,17238,70573,68692,663N.A.3,834,714 Total energy consumptionMJ569,890,00012,232,000196,230,28885,080,00019,282,84023,332,833N.A.906,047,961 302-4 Reduction of energy consumption Amount of reductions in energy consumption achieved as a direct result of conservation (GJ) GJ431334747701,493567N.A.3,641 Amount of reductions in energy consumption achieved as a direct result of conservation (kWh) kWh119,81992,838207,36019,475416,637157,361N.A.1,013,490 302-5 Reductions in energy requirements of products and services Reductions in energy / production vol in ton (MJ/tonnes) MJ/tonNot applicable – calculated at the NIPSEA Group level0.95 GRI 303Water (Revised: 2018) 303-1 Interactions with water as a shared resource Qualitative information not available in this tableRefer to Chapter 4: Environment – Enabling Water Positivity for details 303-2 Management of water discharge related impacts Qualitative information not available in this tableRefer to Chapter 4: Environment – Enabling Water Positivity for details 303-3Water withdrawal Total water withdrawal from all areas in megaliters, and a breakdown of this total by the following sources Ml1,750.2739.88358.1590.8726.9883.76N.A.2,349.91 Surface water MlN.A.N.A.N.A.N.A.0.30N.A.N.A.0.30 Groundwater Ml62.86N.A.8.88N.A.24.813.72N.A.100.27 Third-party waterMl1,687.4139.88349.2790.871.8680.04N.A.2,249.34Next >