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Third Party Opinion

Eiichiro Adachi
Head of ESG Research Center
The Japan Research Institute, Limited

As in fiscal 2014, I was again invited in fiscal 2015 to review the Sustainability Report of Fuji Xerox and its affiliates. Last year, broadly speaking, I made two requests.

The first was to give more substance to the message "Operating at all times on the principle that 'CSR is synonymous with corporate management,' we aim to help our customers create value by ensuring unity of words and deeds (Genko-Itchi )." In this regard, I noted in this year's report that the value creation process has been clearly charted, and the value that Fuji Xerox provides has been defined in concrete terms. I also felt that the report's structure serves to guide the reader, as the Top Commitment and the Initiatives Addressing High- Priority Management Themes: Highlights are now placed within a more logically structured overall flow.

My second request last year was this: "I look to Fuji Xerox for a proactive message about what the better society they envision will be like." This year, I noted that the social issues that Fuji Xerox should address have been set out concretely and the high-priority management themes have been recast in terms of the stakeholders concerned. In addition, the new value standards that Fuji Xerox has been promoting over the years strike me as more persuasive now that they are set out in a timeline. Having the "Evolution of Fuji Xerox Value Creation" timeline heightens the reader's expectations for the company's growth in the years to come.

While the ties and relationships between the social issues to be addressed and the value the company provides have been made clear, there remains a slight sense of disconnect when this is presented under the headings of the existing business segments or stakeholders. This may be inevitable, as the business segments were never designed to address specific social issues or types of value, nor is there a one-to-one correspondence with the stakeholder categories. When the task at hand is to disclose information while focusing on the integration of business and CSR, however, it becomes a real issue. Further, while I found the section onthe technologies that support Fuji Xerox's growth very interesting in itself, here too the overall picture in terms of the corresponding social issues or value to be provided remained somewhat unclear.

In the disclosures on Engagement with Stakeholders, the established format-consisting of "Our Ideal," "Our Basic Approach," previous fiscal year performance, current fiscal year initiatives, and case study-is easy to follow and highlights the main points well. The information disclosed in Main CSR Indicators also sheds considerable light on how the PDCA is operating at the company and its affiliates, and I would like to commend Fuji Xerox for monitoring progress using comprehensive CSR indicators in this way.

That said, in the fiscal 2015 report (including the disclosures on the website), there were a number of puzzling lags in CSR efforts bearing fruit. These included the reduction of new resource inputs in the manufacturing process by reusing parts, the increase in VOCs (volatile organic compounds), the increased number of workplace accidents per 1,000 employees at affiliates in Japan, and the drop in the percentage of women in executive and managerial positions at overseas affiliates. I would have liked to see a detailed explanation of the factors behind these figures, and also information on the decrease in Fuji Xerox's total spending (on a consolidated basis) on social initiatives and activities that contribute to the community.

To recapitulate, then, in its Sustainability Report for fiscal 2015, Fuji Xerox has made ambitious strides forward in clarifying the management processes involved in integrating its business and CSR. They have undertaken with commendable seriousness to discuss the social issues that they themselves should be addressing and the value that they themselves should be providing, instead of merely identifying generic "material issues," and I hope that Fuji Xerox will continue to issue a similarly distinctive and forward-looking Sustainability Report in the future.

The comments above make no statements regarding whether the data have been accurately measured and calculated in accordance with generally accepted standards for preparing environmental reports or whether all important matters have been reported.

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