Focused on Creating Shared Value Promoting Net-Zero-Energy

Housing
CSV Strategy 1 Providing high-quality, eco-friendly housing without any
constraints related to energy issues

Addressing two important issues through our CSV strategy:

Backdrop
combating global warming and finding solutions to the energy supply problem
There is a pressing need to prevent global warming by with these issues and how we can translate them into
reducing CO2 emissions. In Japan, energy sustainable business models. The solution we devised
consumption in the residential sector has doubled in is the Green First strategy. This strategy is expected to
the last 40 years, which has led to a huge increase in help us deliver housing Residential
sector
CO2 emissions. We urgently need to carry out effective that can simultaneously 31% Industrial
measures to reduce emissions, given that the provide comfortable sector
29%
residential sector accounts for about one third of the living and low energy Japan’s electricity
consumption by
nation’s electricity consumption. While energy-saving costs for homeowners, sector in 2009

efforts are being made in homes, these efforts depend while also contributing
upon the forbearance of residents and their having an to a reduction in CO2 Transportation
Commercial sector
energy-saving mindset. As a housing manufacturer, emissions. and public sector 2%
38%
Sekisui House has been studying how we can cope Source: IEA/OECD Electricity Statistics

Aiming to expand the market for energy-saving and energy-creating houses

Our goal
and promoting energy self-sufficiency, while providing comfortable living spaces
Contract house construction is a core segment we emissions of houses, we aim to expand the market for
believe can contribute to the reduction of residential CO2 houses that are both comfortable and economical.
emissions in an effective and sustainable manner. With
Residential CO2 emissions have increased by about 60% from the 1990 level
Action Plan 20, which was launched in 2005, we Rate of increase from Up
1990 level (%) Amount of residential CO2 emissions 59.0
targeted a 6% reduction in CO2 emissions from 1990 60
%

levels (equivalent to a 20% reduction in CO2 emissions

Number of
from the projected residential energy consumption rate 40 households

in 2010). In 2009, Action Plan 20 was subsumed under

20
our Green First initiative, which also incorporated the
concept of generating alternative energy through houses 0
CO2 emissions per household
equipped with solar and fuel cells. Our Green First Zero -10
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2013 (year)
Preliminary data is used for the CO2 emissions of 2013
initiative was launched in 2013. While reducing the CO2
This chart was prepared using data provided by the National GHGs Inventory Report of Japan and the basic registry of residents.

21 Sekisui House Sustainability Report 2015

 Leading the government’s ZEH initiative
Action policies
by actively promoting our Green First Zero model
The Japanese government formulated a strategic energy Greater comfort
plan—approved by the Cabinet in April 2014—that
advocates the adoption by 2020 of net-zero-energy house
(ZEH) design as standard for newly built homes.
• Main stakeholders
Customers, partner companies (equipment manufacturers, etc.), energy Conventional
supply companies Green First model
Comfort
• Measures Comfortable living—
now and always
Launching and spreading the Green First Zero model, which provides
energy-neutral housing environments in line with the ZEH standards. 3 homeowner benefits
Green First Zero features Economy Eco-friendly
High insulation Economical
lifestyle
Living in harmony
with nature

Providing advanced heat-insulation systems, including argon gas-filled

double glazing as standard
Introducing comprehensive energy-saving solutions
Providing—as standard—high-efficiency air conditioning systems, Greater economic Greater
equipment that uses less hot water, LED lighting equipment, and HEMS advantages eco-friendliness
(home energy management systems) (solution to energy problems, etc.)

Utilizing natural energy effectively

Using different types of glass, depending on the direction the window faces,
and adapting the design to control solar radiation and optimize ventilation
• Specific promotion measures
• Developing and operating an in-house program for assessing the
implementation rate of net-zero-energy homes
• Actively proposing ZEH subsidies to customers
• Conducting application of subsidies on behalf of customers
• Holding study sessions for the application of ZEH subsidies,
preparing manuals, etc.
• Target for FY2015
To have 65% of all new Sekisui House detached homes built to the Green
First Zero specification
Reducing the financial burden on homeowners
Risk management
and offering consultation services for achieving comfortable lifestyles
Risk

1 Adopting the ZEH model leads to an increase in construction costs

Our
response In order to meet the ZEH standards stipulated by the Japanese government, a regular Japanese home must be fitted with additional energy-saving
1 equipment—for example, advanced heat-insulation equipment. In general, Sekisui House homes come standard-equipped with more
energy-saving features than homes built by other manufacturers. They therefore require relatively lower additional costs to meet ZEH standards.
ZEH-compliant homes still require higher initial costs compared with conventional homes, and that is why we are working to establish a
system to reduce the burden on homeowners. As part of this effort, we are seeking the understanding and cooperation of manufacturers of
energy-saving and energy-creating equipment with regard to cost reductions. We have been outlining to them our plans to equip more than half of
our newly built homes with Green First Zero features, and we have proposed central purchasing of their products.
The main benefit of a Green First Zero home is that it delivers very low utility costs, thanks to its energy-saving and energy-creating features.
We are currently cooperating with energy supply companies to find ways to reduce fuel costs borne by the homeowner.

Risk

2 Changing social conditions leading to a reduction in government subsidies or a decline in the sell-back price of
surplus electricity generated by installed solar panels
Our
response We train our sales staff to effectively propose to customers the benefits of Green First Zero homes—that is, that they can deliver an economic
2 advantage while providing healthy and comfortable living spaces and contributing to improving inhabitants’ lifestyles. Furthermore, we are helping
to reduce the financial burden on homeowners by using our designated environmental protection expenses to cover part of the initial costs.

Sekisui House Sustainability Report 2015 22

 Focused on Creating Shared Value
CSV Strategy 1

Implementing
action plans Company-wide promotion of the Green First Zero initiative

Sekisui House began promoting sales of Green First homes in educational seminars for prospective customers at various
2009, as the focal point of its CSV strategy. We subsequently locations. Compared to houses built in 1990, our detached
launched the Green First Zero model in April 2013, prior to the houses newly built in 2014 emitted 73% less CO2—a
Japanese government’s introduction of a net-zero-energy reduction of 43,000 t-CO2. Note: See page 27 for details on remodeling.

housing (ZEH) policy that aims to have all new homes built to
Reduction in CO2 emissions achieved by the Green First strategy*
the net-zero-energy house specification by 2020.
Amount of CO2 reduced (t/year) Target and result (%)
We have been proposing the Green First Zero design to 80,000 Amount of CO2 reduced 80
73.4
our customers by clearly explaining that this type of housing Target rate 75
Achievement rate 61.5
offers three main benefits: (1) it can deliver a significant 60,000 51.3 55.7 65 60
49.4
reduction in utility costs; (2) it enables the creation of
comfortable living spaces; and (3) it embodies future trends in 40,000 40

housing.
20,000 20
At the same time, we remodeled our showrooms across
the country to make them better equipped to demonstrate
0 0
the advantages of Green First Zero, while also holding 2010 2011 2012 2013 2014 2015 (FY)
*Estimate by Sekisui House

Achieving FY2014 target of 60%

Evaluation
for Green First Zero Growth in the number of Green First and Green First Zero homes
The Green First initiative—the forerunner to Green First Zero— Number of Green First homes Result
Number of Green First Zero homes Target Result
was launched in 2009. In FY2012, we were able to achieve that (Number of homes) Target and result (%)
15,000 100
83.8 83.7
year’s target of 85% implementation of Green First designs in
12,000 70.7 80
new homes. Later, the more sophisticated Green First Zero 77.9 65
60
initiative was launched. We achieved an initial adoption rate of 9,000 60
58.5
58.5% of new home builds in FY2014—fractionally short of our 6,000 47.9 6,410 40
Green First 5,285
60% target rate. Given that the implementation rate has been
3,000 Green First Zero 20
rising month by month, we are confident that we are now
0 0
consistently surpassing our original target rate. 2010 2011 2012 2013 2014 2015 (FY)

Advantages

Green First Zero delivers comfort,

economy, and environmental performance

Green First Zero model

Advanced, energy-
saving heat PV system
insulation system for energy creation Electricity supplied
Energy savings by power company Energy creation
30% higher efficiency than the level stipulated
by government guidelines

Reduced Air conditioning and lighting equipment • High-quality Ene-Farm energy- Home
air system creating storage cell
energy use HEMS Storage cells generation
Managing energy used Upgraded storage cell system
in everyday life

• EV outlet EV-PHV

• Integrated system capable of resisting, controlling, • Floor heating using

and isolating vibrations from earthquakes hot water

Green First Zero aims for energy self-sufficiency without sacrificing the comfort of the living environment. It is designed to offset energy use, even to
the point of achieving zero energy consumption. It does this by (1) greatly reducing household energy use compared to conventional levels, through
measures such as heat insulation and high-efficiency equipment; and (2) using home generation to create the remaining electricity.

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Action items
for FY2015

For FY2015, we are reviewing the specifications of Green First Zero of additional control functions in our housing, which have been
and enhancing our application system for the Japanese incorporated into our standard nationwide specifications as of April
government’s ZEH subsidy, so that this type of housing will be more 2015. In the further pursuit of greater energy self-sufficiency, we
amenable to our customers. Due to a revision of the feed-in tariff have developed a new system that automatically charges storage
system for renewable electric energy, some power companies are cells when surplus solar energy cannot be sold back to the grid due
placing limits on how much solar-generated power can be sent back to output limitations. Energy stored in these cells can then be used
to the electrical grid. This revision has necessitated the installation in the evening.

TOPIC Green First Zero Receives 2014 Special Jury Award in Energy Conservation Grand Prize Awards

Our Green First Zero housing product, which was

launched in 2013 and which embodies a
Comments from a jury member
comfortable energy-neutral lifestyle envisaged for With this product, Sekisui House aims to boost the proliferation of net-zero-energy
2020, received a 2014 Special Jury Award in the houses (ZEH). Sekisui House has developed a tool that allows users to easily
Energy Conservation Grand Prize* program in calculate energy usage and production levels, so that their homes can meet the ZEH
Japan. By effectively incorporating energy-saving standards outlined in the Japan government’s subsidy system (which launched in
and energy-creating features that offset energy 2012). Sekisui House has provided a popular model for energy-neutral housing, one
use while ensuring a comfortable living that creates added value to offset the increased costs of energy-saving equipment.
environment, Green First Zero has proven itself to Harnessing an original and informative standard-equipped HEMS platform, Green
be a trendsetter for net-zero-energy housing. First Zero housing offers a highly comfortable living environment coupled with
*Organized by the Energy Conservation Center, Japan and sponsored by significant reductions in energy costs.
the Ministry of Economy, Trade, and Industry

Advanced technology of Green First Zero Energy creation: promoting Ene-Farm fuel cell systems
Advanced heat-insulation system for comfortable and With the cooperation of a number of equipment manufacturers and gas
healthy lifestyles suppliers, we conduct customer satisfaction surveys and
Our upgraded heat-insulation system, which is incorporate the feedback into our operations. In response to
installed as standard equipment, outperforms the customer needs identified through these surveys, we have
level stipulated by the government guidelines by been providing more thorough explanations of installed
about 30%. Further, we have begun using equipment and reviewing equipment and fuel costs to
aluminum-resin composite heat-insulating window minimize the burden on homeowners.
sashes and argon gas-filled heat-insulating
double-glazed glass in exterior-exposed areas. This Energy creation: improving capacity and reducing costs of solar cells
is part of our “slow living” design concept, which aims to provide To promote the use of photovoltaic (PV) systems, we have been working
customers with more comfortable living environments. with suppliers to improve the performance and reduce the cost of solar
cells. As part of our efforts, we have developed a new and economical
Cutting-edge technology: providing our original HEMS service
method of mounting solar cells. We have also been holding seminars and
In collaboration with IBM Japan, Ltd., we have established a HEMS platform training sessions to promote customers’
that facilitates centralized data management, makes energy consumption understanding of solar power. As a result, the
more visible to residents, and provides easier access to useful information number of solar cells installed on each newly built
(such as gardening tips and security detached house has increased by 30% on
information). Our HEMS platform provides average, contributing to a reduction in CO2
additional value that can improve emissions, a lowering of utility costs, and a higher
inhabitants’ quality of life. rate of renewable energy use.
Roof tile-integrated solar panels

Sekisui House Sustainability Report 2015 24

 Focused on Creating Shared Value
CSV Strategy 1

The Sekisui House Group’s Housing-Focused

Disaster Preparedness Plan
We are strengthening our business continuity plan (BCP) so that it facilitates rapid rebuilding while placing
the highest priority on protecting the everyday lives of our customers during times of disaster. At our Tohoku
Factory, we have established a Disaster Risk Reduction Factory of the Future plan that turns the facility into
a reconstruction site during times of disaster. We are promoting this plan in four other factories nationwide.

Disaster Readiness—Preserving Comfortable Living, Even During Disasters

1 Disaster-ready smart house 2 Disaster-ready smart town 3 Support structures for disaster recovery

Net-zero-energy house (1) Data management system for customers’ houses

Highly earthquake resistant and Disaster-ready smart houses (2) Sites that are self-sufficient during disasters (nationwide factories)
self-sufficient during disasters (3) Distribution network

Houses that protect homeowners and families A smart town and community that protects its residents Factory and employees that protect their local community
Building side: Green First Zero Building side: smart houses and various shared designs Building side: reconstruction support center and self-sufficient disaster-proof factories
People side: promoting disaster preparedness People side: building community ties People side: information management + human assistance structure + distribution system

Learning from the past to develop enhanced disaster-readiness measures

Every three to five years in Japan, there is a major earthquake measuring 6 continuity.
or higher on the Japan Meteorological Agency’s seismic intensity scale. 5 We also need to develop a backup strategy in the event that networks fail
Such major earthquakes are an unavoidable reality that must be factored or manufacturing and construction systems do not function adequately.
into the construction and ongoing management of the more than 2.2 million Going forward, the Sekisui House Group will continue to carry out
houses that Sekisui House has built in Japan. And given our social and strengthen activities such as those outlined above. To enable a rapid
responsibility to ensure the safety of homeowners and provide support response during emergencies, we will implement disaster-readiness
during emergencies, it is also vital that we continue to strengthen and measures—for example, installing self-sufficient energy-supply
develop our disaster-readiness measures. equipment—at five factories nationwide that will function as regional
In 2011, an unprecedented number of our customers were affected by recovery support sites. Furthermore, we will promote a Disaster Risk
the Great East Japan Earthquake. Although none of our buildings collapsed, Reduction Factory of the Future plan in which factories can act as
about 30,000 of them required urgent repairs or restoration work. shelters for residents during disasters.
Meanwhile, the Japanese government had also requested our assistance in
the construction of temporary housing. At the time, our workforce of
construction personnel in the affected regions was insufficient to meet
Self-Defense
rebuilding needs on such a tight schedule. We therefore collaborated with Local Forces, police,
Nationwide factories, distribution sites, and offices

building contractor partners nationwide to employ 410,000 workers in

governments Restoration site and fire service
and communities
during disasters
Homeowners and offices in affected areas

reconstruction efforts. + shelter for residents

Although we have learned many lessons from other disasters in the
past, there are five main points that the Great East Japan Earthquake has
highlighted: Relief goods Relief goods

1 Since natural disasters are inevitable, it is essential that we are mentally

and physically prepared for them and that we are ready to work with
EV/PHV
other organizations and group companies.
2 Restoration and reconstruction efforts are carried out by people, so it is Distribution Distribution
route between Disaster Risk Reduction route between
important to maintain the mental and physical health of our employees, factories Factory of the Future factories and
offices
while also securing our facilities and establishing a nationwide support
system.
Self-sufficient functions during disasters
3 We can confirm the safety of homeowners as part of our ongoing
Uninterrupted power supply, power generators,
after-sales services. In addition, we can transport relief supplies and storage cells, solar power generation, FEMS*, EV/PHV,
secure necessary fuel and power supplies. and shelters
4 There is a need to develop a system for rapid restoration and business *Factory energy management system

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1 Disaster-ready smart house: self-sufficient Green First Zero house

1 week to several months Maintaining energy Using Using After about 3 days Maintaining water and food
solar power rainfall
Energy creation
(Energy generation/self-sufficiency) Stock shelter Earthquake-
Solar cells, storage cells, fuel cells (water, food) resistant rainfall
Three days’ worth of tank for the toilet
Energy savings water and 200 liters
(Energy conservation/ emergency food
self-sufficiency)
High level of After a major earthquake with a seismic
insulation and intensity of 6 or higher Maintaining living space
energy-saving
Green First Zero—net-zero-energy housing appliances Ensuring earthquake resistance + seismic control/isolation
by Sekisui House

Seismic assessment Hardware to fix Door with earthquake-

furniture resistant lock

Green First Zero smart houses support self-sufficient lifestyles during the earthquake strikes, even when distribution channels have been
three stages of disasters: disrupted;
1 Maintaining living space through advanced earthquake resistance and 3 Net-zero-energy housing as a foundation for disaster readiness; houses
seismic control technology; that allow energy to be generated and stored, with energy
2 Ensuring sufficient water and food and using a rainfall tank for toilet self-sufficiency supporting daily living until energy infrastructure is
water to maintain regular daily lifestyles for at least three days after an restored or stabilized.

2 Disaster-ready smart town operates self-sufficiently even after disaster strikes (Smart Common City Akashidai, located in Tomiya Town, Miyagi Prefecture)
1 Spaces are designed to be shared by residents—this includes 2 Residents and local businesses and organizations jointly plan events
pedestrian paths, open exteriors, and other free spaces where lights are such as autumn and harvest festivals. Disaster drills are conducted with
programmed to turn on in nearby houses during blackouts. Community the cooperation of the fire department and its squad members. Such
centers act as disaster relief centers that can be used even during activities help residents to appreciate the importance of community,
power failures. while reinforcing concepts of self-help, mutual
assistance, and public welfare.
Three years after its founding, the Smart
3 Common City Akashidai community officially
established its own residents’ association.
Residents take pride in the community’s status
as Japan’s most disaster-prepared town.
1 Disaster-ready smart houses 2 Fond memories of a local mikoshi festival 3 Introduced in the Tomiya Town
public relations magazine

3 Support structure for disaster recovery: establishing a customer data management system and self-sufficient recovery site

1 Identifying affected 2 Appointing visiting staff 3 Confirming damage 4 Determining restoration 5 Restoration work and
areas measures management

In the event of a major

earthquake Repair and restoration methods are
determined according to the level and
type of damage.
The level of seismic intensity and the A customer service center in the Following an initial visit,
areas affected are confirmed, and affected area works with branch damage-related information and Requests for
homeowner housing in the offices and establishes a contact photos are registered and shared on restoration work
disaster-hit area is assessed. center. the customer housing database. are registered. Reconstruction progress management

1 In areas affected by a major earthquake, homeowner information will be 3 Damage will be determined and registered in the DB. If required, relief
obtained from a database (DB). The nearest factory will begin supplies will be provided to the homeowner.
self-sufficient operations as a disaster response site, and stockpiles will 4 Restoration methods will be reviewed and finalized. A detailed
be transported from nationwide sites. reconstruction process will be established, using the nationwide
2 Using information obtained from the DB, staff will be appointed to network.
assess the safety of homeowners and the condition of their buildings in 5 Restoration work will start. Records of response measures will be stored
affected areas. A hotline and special contact center will be established. at branch offices and at the head office.

Sekisui House Sustainability Report 2015 26

 Focused on Creating Shared Value
CSV Strategy 1

Preventing Global Warming through the Collective Power

of the Sekisui House Group
Promoting Green First Remodeling projects VO I C E
Sekisui House Remodeling makes remodeling proposals to
homeowners that help to make their homes more Achieving comfortable and economical living
comfortable—now and always. Based on our net-zero-energy Under the Green First Remodeling initiative, we remodeled our
house and installed a PV system, fuel cells, and LED lighting.
housing design, our Green First Remodeling projects achieve
This drastically reduced our monthly electric bill, showing just
energy saving, energy creation, and enhanced comfort. By how effective the remodeling was in terms of energy savings.
meeting customer needs for photovoltaic (PV) systems, Bright LED lighting in the living room has made it a more
improved insulation, and high-efficiency water heaters and air attractive place for the whole family to get together and chat.
And thanks to the meters that make our energy usage visible—
conditioners, our remodeling proposals support comfortable,
even from the bathtub—we all have a better awareness about
economical, and healthy living. What’s more, our proposals energy conservation. It was great
help to reduce the amount of CO2 emitted by a house, that we were able to remodel our
house without having to
making them environmentally friendly. Under our premium
dramatically change our lifestyle.
specifications, the primary energy used by a house is offset to
zero, effectively achieving the kind of net-zero-energy housing Mr. O’s family (Osaka Prefecture)
stipulated by the Japanese government.

Green First Remodeling

Premium or

Next-generation energy-saving system PV system Fuel cells High-efficiency water heater Energy-efficient equipment

High-grade or

Window and door insulation PV system Fuel cells High-efficiency water heater Energy-efficient equipment

Standard
Window and door insulation High-efficiency water heater Energy-efficient equipment

Flooring Existing thermal

Development and sales of new underfloor insulator
insulation
In July 2014, we released a proprietary method for improving
underfloor insulation. This method improves the thermal
insulation performance of flooring in houses built in 2000 or
earlier, thereby reducing air conditioning costs and lowering Joist
energy consumption. An increasing number of our customers
are adopting this as a healthy and comfortable lifestyle choice New
insulation
that helps keep heads cool and feet warm. Minimizing the filling
burden on the owner, our patented method enables easy material Lumber
New insulating material girder
installation without the need to dismantle the floor.
with non-woven fabric

Energy-creating, energy-saving
remodeling achievements* CO2 emission reductions through energy-creating,
energy-saving remodeling*
Remodeling options for energy savings and energy creation Results for FY2014

PV system installations 2,990 cases 2010 4,803

Energy-efficient bath fixtures 3,956 sets 2011 5,762

10,638
Window and door insulation 3,842 cases 2012
Ene-Farm fuel cell system 183 units 7,720
2013
Eco-Jozu (latent heat recovery gas water heater system) 2,994 units
2014 6,603
(FY)
Eco-Cute (CO2 heat pump water heater system) 767 units
(t-CO2/year)
*Results by Sekisui House Remodeling *Results by Sekisui House Remodeling

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Total capacity of Sekisui House Group PV system installations

Sekisui House and 20 group companies, including Sekisui Total capacity of PV systems installed in FY2014
House Remodeling and Sekiwa Construction, cooperate to by the Sekisui House Group

advance the PV system business, which works to help reduce Sekiwa Construction
companies
CO2 emissions. In FY2014, along with installations on newly
21.2MW
built detached homes and Sha Maison low-rise rental
Sekisui House Total
apartments, we retrofitted homes with PV systems and Remodeling
168.6
installed them on an increasing amount of idle land, often 22.0MW MW
yielding relatively large power outputs of 10 kW or more. We Sekisui House
increased our annual PV system installation capacity to 168.6 125.5MW
MW.

Japan’s first smart, micro-grid-based, disaster-ready eco-town in Higashi-Matsushima

In Higashi-Matsushima City (Miyagi Prefecture), Sekisui House is
collaborating in the creation of a “smart town” in which residents can
live with peace of mind—a town that is resilient in the face of natural
disasters and that contributes to the prevention of global warming by
promoting efficient energy usage and lowered CO2 emissions.
This is the first smart grid*1 in Japan that incorporates the mutual
Artist’s rendering
exchange of energy across properties, including detached houses.
Sekisui House constructed 85 public housing units and a micro grid*2 Outline of Higashi-Matsushima Disaster-Ready Smart Eco-Town
connected to each facility via a private line. Electricity is supplied
through a community energy management system (CEMS) operated
by a private-line power producer and supplier (PPS)*3 that also owns Existing
power
a PV system. Solar power generation has made it possible to achieve network
Local low-carbon power plant Local low-carbon power plant
an annual reduction in CO2 emissions of 256 t-CO2. Short-term peaks (garbage incineration facility, etc.) (mega-solar)

in energy demand are met by a supplemental supply delivered over

Private line PPS
existing power lines by a low-carbon energy provider located in
Higashi-Matsushima. In this way, energy is both produced and Bio-diesel emergency
power generator
consumed locally. Regulating pond PV 400 kW (500 kW)

If the main power system is shut down by a natural disaster or for

some other reason, the installed PV system, storage cells, and large
Large storage cells
bio-diesel power generator ensure a normal energy supply for three 70 detached houses
(500 kWh)

days. Even during long-term blackouts caused by a major earthquake

or the like, PV systems and storage cells can continuously deliver the
energy required to run facilities such as hospitals and community
15 apartment buildings Community hall PV 10 kW 4 hospitals Public facilities
halls. (Tenants are scheduled to move in from August 2015.) PV 60 kW (disaster response site)

*1 Smart grid: a power network utilizing communication and control functions such as smart meters Houses installed with HEMS Disaster-ready eco-hospital district
*2 Micro grid: a small-scale energy network
*3 Private-line PPS: an electricity operator other than a general electrical utility, which delivers electricity over
privately installed power lines

Key performance indicators (KPIs)

Category Indicator Unit FY2010 FY2011 FY2012 FY2013 FY2014 Definition and remarks
Amount of energy input at the various stages
Total energy input*1
TJ 2,872 2,851 2,830 3,542 3,039 of development and design, factory production,
transportation, construction, and demolition
CO2 emissions at the various stages of
Amount of CO2 emitted at these stages per
development and design, factory production, t-CO2 123,125 119,969 114,780 148,329 126,209 fiscal year
construction, and demolition*1

CO2 emissions at the Amount of CO2 emitted at the transportation

transportation stage*2 t-CO2 37,886 39,967 38,959 45,815 37,749 stage per fiscal year
Global
warming Reduction of CO2 emissions
from the 1990 level (amount) t-CO2 37,468 39,372 42,074 50,256 43,015 Reduction of residential CO2 emissions from
prevention new detached homes in comparison with the
Reduction of CO2 emissions 1990 level (amount and %)
from the 1990 level (%) % 49.4 51.3 55.7 61.5 73.4
Proportion among all built-to-order
Proportion of Green First Zero homes % - - - 47.9 58.5 Sekisui House detached homes

No. of existing houses, built by Sekisui House

No. of houses retrofitted with
a PV power system 1,634 2,569 7,249 4,155 4,216 and by other builders, that have been retrofitted
with a PV system under our remodeling project

*1 Starting in FY2013, energy input by Sekisui House’s consolidated subsidiaries in Japan (40 companies) and Sekisui House Advanced Manufacturing (Shenyang) Co., Ltd. was added to the total energy input.
*2 Starting in FY2013, the amount of CO2 emitted during product shipments by Sekisui House Advanced Manufacturing (Shenyang) was added to the total.

Sekisui House Sustainability Report 2015 28

 Focused on Creating Shared Value

CSV Strategy 2 Preserving Biodiversity

Creating a society where we can live in comfort while preserving
ecosystems and natural cycles

Backdrop Material analysis that goes beyond current conditions to assess impacts on stakeholders

When it comes to biodiversity, attention is easily drawn to certain on-site activities aimed at protecting rare species of
animals and plants. But if a company is to take social issues seriously, it should strive to maximize its influence on
biodiversity preservation through its main business activities. When we analyze our business activities from this
perspective, the following two points appear as the backdrop to our biodiversity protection efforts.

Influence as one of Japan’s largest

landscape gardeners Influence on an extensive supply chain

Sekisui House is Japan’s largest producer of housing. Every The parts and materials used for a single house can number
year, we plant more than one million trees for homes and in the tens of thousands. As a leading company in the
streets—more than the total number of trees in the streets of housing industry—one that procures parts and materials from
Tokyo. As we are effectively one of Japan’s largest landscape numerous manufacturers in the supply chain—our supply
gardeners—in terms of both actual trees planted and sales chain management extends its influence on manufacturers
income recorded—our influence is such that our choice of and trading companies even further upstream.
tree species can change trends in the tree production market. Every year Sekisui House consumes over 300,000 cubic
Landscape gardeners typically choose exotic or garden meters of wood, a biological resource indispensible to
species based on their appearance and ease of maintenance. housing construction. We believe that wood is a material that
However, not all of these species are necessarily beneficial to demands the closest of scrutiny when considering the
the birds and insects of a given region. That is why it is crucial complexity of its traceability and distribution channels.
when selecting tree species to consider the local ecosystem.

Standing apart from other companies by promoting

Our goal
the social and homeowner value of biodiversity
Sekisui House’s efforts in biodiversity protection have received much acclaim. We won the highest prize at the Japan
Sustainable Management Awards*1 for our Wood Procurement Guidelines, an Excellence Award at the Japan Awards
for Biodiversity*2, and a Prime Minister’s Prize at the Green City Awards*3 in recognition of our Gohon no ki greenery
projects. Our goal is not simply to win awards; rather, we hope that winning these awards will serve as a catalyst for
spreading biodiversity protection and deepening its roots in society through our suppliers, and that we can lead the
industry and differentiate ourselves from the competition in providing customers with a rich and comfortable lifestyle.
*1 Environmental Value Creation Pearl Award, 8th Japan Sustainable Management Awards (sponsored by Japan Sustainable Management Awards Committee and Mie Prefecture)
*2 Excellence Award, 1st Japan Awards for Biodiversity (sponsored by the Ministry of the Environment and Aeon Environmental Foundation)
*3 Prime Minister’s Prize, 34th Green City Awards (sponsored by the Organization for Landscape and Urban Green Infrastructure)

Procurement as a strategic utilization of

Housing as green infrastructure “natural capital”
Recently, the concept of “green infrastructure” is gaining We are acutely aware of our high level of dependence on
attention as a solution to issues such as risks of natural natural resources, and so we are engaging our suppliers in a
disasters, deteriorating natural environments, and dwindling long-term scenario for eco-friendly procurement.
communities. The concept involves utilizing the diverse
Defining the role of procurement in creating corporate value
services and multifaceted functions provided by ecosystems
Equipment and infrastructure that can be used for Air, water, land, forests,
to address such problems. manufacturing products and providing services minerals, biodiversity

Houses and the surrounding greenery serve as shelters Natural

Manufactured capital
that protect the lives and maintain the happiness of those capital (environment)
(equipment)
who live there. But that’s not all. By regarding them as a vital Intellectual Human
capital capital Procurement
part of the urban infrastructure and by redefining them as (information) (personnel)
Financial Social and
having the potential to change society, we believe that the capital relationship
value of biodiversity can become more widely appreciated (finances) Intangible assets Employees’ capital
such as patents proficiency,
and know-how experience, and (stakeholders)
throughout society. Funds from stockholders willingness to seek
and investors, loans from innovation
Relationship of trust with
banks
stakeholders

29 Sekisui House Sustainability Report 2015

 Collaborating with suppliers in protecting biodiversity
Action policies
by quantifying environmental impact of business processes
We are focusing on strengthening our suppliers’ contribution to biodiversity protection by building relationships of
mutual trust with them. This is done through process management and through efforts to enhance our ability to
accurately trace biological resources further upstream in the supply chain.

Gohon no ki landscaping concept

Promoting tree species that are suited to local ecosystems
Promoting the use of FairWood

The concept of the Gohon no ki landscaping project, which Each year we conduct procurement surveys on roughly 60
the Sekisui House Group launched in 2001, is to promote suppliers of wood materials. We ask them to report the place
gardening and landscaping in a way that can support local of production and the attribution of procured wood, while also
ecosystems and foster living creatures. For this reason, we confirming its legality. Based on our guidelines, this
are planting mainly indigenous species as opposed to exotic information is converted into numerical data, which is then
or garden species. used to manage ongoing progress in this area.
When starting this project, we sought the cooperation of Through these efforts, suppliers can enhance awareness
local tree growers and landscapers. We asked them to grow of their own procurement routes. Trading companies further
indigenous species, because at that time few such species upstream in the supply chain also become ever more aware of
were available on the market. Having secured a stable supply fair procurement. As a result, the use of FairWood* becomes
of indigenous species, we are now working to communicate to widespread.
residents the joy and comfort of living in harmony with nature. *FairWood is wood sourced with consideration to the natural forest environment and local
communities of where it is logged. It is advocated by the Global Environmental Forum and
FoE Japan, an international environmental protection NGO.

Shifting away from Adopting a cooperative,

adversarial negotiations advisory role
QCD QCD+Ec (S+Et)
Garden Garden
Satoyama

Satoyama

Manufacturer Manufacturer
Forest

Forest

Town

Social issues
Supplier
Garden Park
Supplier Supplier Supplier
Supplier Supplier

Q uality C ost D elivery E cology S ocial E thical

No manufacturer can truly establish relationships of trust with its suppliers if it only
makes one-sided demands regarding quality, cost, and delivery time. Recognizing that
Satoyama network the role of a manufacturer must change over time, we are promoting efforts to deepen
the cooperative relationships we have with our suppliers so that, through our business
Small gardens in urban areas can play an important role in maintaining local ecosystems activities, we can share a common sense of purpose and work together to address
social problems such as the loss of biodiversity.

Securing influence based on the premise of a long timeframe for

Risk management
natural capital and for ecosystem services to mature

Gohon no ki project Wood procurement

Risk Risk
Gohon no ki may lose its distinctive advantage as Tightening regulations threaten our ability to ensure a
1 competitors follow suit 2 stable wood supply
Our Our
response Taking advantage of the longstanding relationship we have maintained response In many cases, local environmental NGOs have the latest information

1 with a network of tree growers, we are striving to focus on species

that meet market needs. We are also holding study meetings to 2 regarding logging restrictions. Since we have ties with a network of
globally operating environmental NGOs, we can promptly obtain such
improve the ability of our employees to persuade customers of the information and share it with wood suppliers so that they can make
benefits of our recommended designs. Furthermore, we are preferential supply arrangements for us as needed.
reinforcing our landscaping construction system to provide a higher
level of exterior design for our customers. Through these activities, we
endeavor to differentiate ourselves from our competitors.

Expected benefits

In accordance with our SLOW & SMART brand vision, which we launched in We can be well prepared for any future tightening of regulations regarding the
2012, we have been striving to communicate to our customers the comfort of traceability of traded wood (for example, in the EU’s Timber Regulations or in
living close to greenery—a benefit made possible by our large sash frame the United States’ Lacey Act). By being informed of the status of each supplier
doors. We define these lifestyles as “slow living,” and we have been actively ahead of our competitors, we can request them to make preferential supply
promoting greening as an essential part of such lifestyles. Doing so not only arrangements for us. These guidelines also help us formulate rules when we
helps us differentiate our homes from those built by our competitors; it also begin doing business with new suppliers.
adds value to homes.

Sekisui House Sustainability Report 2015 30

 Focused on Creating Shared Value
CSV Strategy 2

Achievements

1 Ecosystem-friendly Gohon no ki landscaping project

Action
Number of trees planted each year and total number planted The cumulative total of trees we have planted under the Gohon
Number of trees planted each year
(10,000 trees)
Total number planted
(10,000 trees)
no ki project exceeded 10 million in FY2013. In FY2014, the
140 Start of Gohon no ki Exceeds 10 million 1,400 number of trees we planted was 810,000, a figure affected by a
120 1,200
100 1,000
decrease in detached housing starts. But as a result of an
80 800 increase in exterior construction and landscaping for rental
60 600 housing, annual sales of our landscaping business—which
40 400
20 200 includes tree planting—reached 58.3 billion yen, an increase
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
0
(FY)
over the previous fiscal year.

Evaluation
A decrease in the number of detached housing starts affects the number of trees planted—this is an unavoidable fact. But recently, customers have come to
appreciate the benefits that greenery provides—such as comfort, a distinctive appearance, and townscapes that grow more attractive over time—even for collective
housing and rental housing. Previously, greenery for collective housing and rental housing was considered a disadvantage, due to initial costs and management
costs. As we become more adept at recommending greenery-rich designs to customers, we will keep working to propose further value.

2 Implementing the Wood Procurement Guidelines

Action In 2007, Sekisui House became the first company in the there are still cases where it cannot easily be determined whether
Japanese housing industry to formulate guidelines for wood or not a shipment is in line with the Wood Procurement
procurement, and we began by requesting our suppliers to follow Guidelines—for example, poplar plantations in China, large-scale
these guidelines. Today, when asked in procurement surveys tree planting in Oceania, or new logging areas where information
where the logging source is for their wood material, almost no is still scarce. We therefore consult closely with specialists and
supplier responds “Unknown.” We feel a positive change in environmental NGOs, and, when necessary, we visit the location
suppliers’ awareness of fair wood procurement. Unfortunately, to see it for ourselves.

Wood Procurement Guidelines: 10 Principles (revised in FY2012)

1 Source wood products from areas with relatively low risk of illegal logging. 6 When logging wood products, avoid conflict with local communities and
refrain from unfair labor practices.
2 Source wood products from areas without sensitive ecosystems.
7 Source wood products from areas of controlled logging, so as not to exceed
3 Do not source wood products from areas where local ecosystems are
the rate of forest regeneration.
seriously damaged due to large-scale logging of natural forests.
8 Source wood products from domestic forests where well-planned forest
4 Do not use endangered species for wood products.
management is in place to conserve ecosystems.
5 Minimize CO2 emissions when producing, processing, and transporting 9 Source wood products from plantation forests that are managed so as to
wood products.
promote conservation and ecosystem development.
10 Use recyclable wood building materials.

Evaluation
In FY2014, the combined proportion of Rank S and Rank A wood exceeded 90% for the first time, a figure we had previously set as a management objective.
The proportion of the highest-marked Rank S wood increased by 8 points to 71%.

Ranking wood products according to their level Shift in percentage of each rank Percentage of wood products by region
of compliance with the procurement guidelines 5% Others*4 Asia*1
Depending on their total score, procured wood products are classified into 4% 14% 19%
four ranks, from high to low: S, A, B, and C. Minimally acceptable scores are 4 South
8 % America
set for Guidelines 1 and 4 , as we place a high priority on these two items. 0.2%
%
20 North 334,000 Europe
34%
Total score
(maximum 43 points) Rank 25 348,000
%
m3
%
334,000 America
17% m3
34 and above S 63 m3 71 South
Pacific*3
North
Pacific*2
26 to 33 A % %
13% 3%
*1 Incl. Japan
17 to 25 B *2 Incl. Russia
*3 Incl. Indonesia, Malaysia
Below 17 C FY2013 FY2014 *4 Incl. Africa (incl. waste wood)

21
31 Sekisui
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 Preserving Biodiversity

Activity report

Preserving biodiversity by utilizing the Common’s townscape assessment system

Sekisui House formulated the Urban Development Charter in biodiversity and landscaping.
2005 and began Community Visiting Day events in 2006. To ensure that Sekisui House townscapes are maintained at
Through these efforts, we have always striven to constantly a high level, we formulated the Common’s townscape
create townscapes that are rich in greenery and that grow more assessment system in 2014. This system comprises objective
attractive over time—high-quality townscapes throughout Japan assessment criteria including those that cover the Gohon no ki
that lead to enhanced corporate value. However, we found some project. We assessed 42 of our residential subdivisions during
cases, located on mid- to small-scale residential lots and on lots Community Visiting Day events in fall 2014, and those with a
for ready-built houses, that could benefit from improved three-star ranking or higher accounted for over 80% of the total.

5-rank assessment, with 3 stars or more the norm

• Assessed items
Assessed
Gohon no ki project Building and exterior planning
in 5 ranks,
• Five trees • Building design from 1 star
to 5 stars
• Symbolic tree • Exterior design
• Green coverage • Retaining wall or fence by
percentage roadside Residential
subdivisions with at
• Percentage of • Floor finish by roadside least 10 lots should
greenery visible to
one’s eye • Boundary finish of adjacent aim for at least a
land by roadside 3-star ranking

Common Stage Shikido in Oita Prefecture was given a 5-star ranking

Key performance indicators (KPIs)

Category Indicator Unit FY2010 FY2011 FY2012 FY2013 FY2014 Definition and remarks

10,000 No. of trees planted per year under

Biodiversity No. of trees planted per year trees 91 96 101 106 81 our gardening and greening plan
preservation Proportion of Rank S and Rank A wood products as Based on the results of our survey
defined by the Wood Procurement Guidelines
% 87 85 89 88 91 of about 60 suppliers of wood products

VO I C E

I commend Sekisui House for taking an advisory role as part of its advanced supply chain management
The Gohon no ki project and the promotion of the use of of supply chain management by playing an advisory role in
FairWood achieve a balance between the preservation and the industry. The company sees the various certification
use of natural resources, and they represent a systems that are in widespread use in various areas of the
comprehensive effort to preserve biodiversity. Sekisui industry as tools to enhance quality. Utilizing these tools
House’s Wood Procurement Guidelines contribute to the clarifies the direction the company should take, and
preservation of forests, which are crucial in preventing the because Sekisui House is making full use of these tools, it
decline and deterioration of existing biodiversity. The high can act as advisor to other companies in the industry.
level at which Sekisui House aims to implement these I would like to see Sekisui House keep
guidelines has an influence on the entire housing industry— up its sincere efforts in implementing the
an industry that procures and uses wood—and it procurement guidelines and go one step
contributes greatly to the industry’s overall goal of fair further to achieve true sustainability.
procurement.
FoE Japan (international environmental protection NGO)
Of note is how Sekisui House is achieving a high level Junichi Mishiba, Secretary General

Sekisui House Sustainability Report 2015 32

 Focused on Creating Shared Value Improving Production and
Construction Quality
CSV Strategy 3 Achieving maximum customer satisfaction with the highest levels
of quality and technology

Backdrop Our goal

Construction workers now fewer and Creating the highest possible quality for
older—a nationwide problem maximum customer satisfaction by leveraging
Of all the countries in the world, Japan is one of the most our production and construction capacities
prone to natural disasters. It is therefore the social
Action
responsibility of the housing industry to protect the lives and policies
property of its customers. At Sekisui House, it is our mission
to provide quality housing that ensures safety, security, and
Cooperating with partner companies in
establishing a system that allows us to
comfort for successive generations of residents.
continually secure skilled workers and ensure a
Meeting customer needs with the highest levels of quality
stable supply of quality housing
and technology is the corporate philosophy of the Sekisui
House Group. In line with that philosophy, we have been • Main stakeholders
striving to win customer confidence and achieve customer Customers, employees, partner companies (for procurement,
satisfaction by providing the highest level of products and processing, distribution, and construction), factories, and
services in every step of our operations: from sales, design, residents living in the neighborhoods surrounding our
and production to construction and after-sales services. And construction sites
since we deal in industrialized housing—residential structures • Organization
constructed from factory-made modular components—it is Our Production Department is responsible for planning and
especially important that we maintain and improve the coordination, while our five factories across Japan are
production and construction quality of our houses. responsible for production, procurement, shipment, and
Before they are delivered to the construction site, our quality control. Our Construction Department is in charge of
factory-made housing components repeatedly undergo a construction-related issues ranging from quality control, R&D,
wide range of inspections according to our strict standards. and training to safety, hygiene control, and welfare programs
And since most of the components used in our housing at construction partner companies. Our sales, technology
construction are factory-made, we can ensure the quality and development, production, construction, and system
precision required for achieving our houses’ targeted departments join forces with group companies and partner
functionality. companies to achieve higher levels of production and
In the end, however, it is people who assemble these construction.
components into houses at a construction site. To ensure that Since our foundation, we have maintained close ties with
our houses will function as designed, according to the Sekisui House Association, a voluntary organization
specifications, we must secure skilled construction workers comprising 20 Sekiwa Construction companies and around
and we must strictly inspect the quality of factory-made 7,000 building contractor partners. Sekisui House and the
components as well as the quality of on-site construction Sekisui House Association work together in their respective
work. Without an integrated system for ensuring high quality regions to promote various initiatives, such as enhancing
and precision throughout the entire housing process—from construction quality, addressing the needs of customers,
performance design and component production to communicating with residents living in the neighborhoods of
construction—the advantages of industrialized housing construction sites, implementing thorough safety measures,
cannot be fully utilized. keeping construction sites clean and tidy, developing human
As houses become more and more functional, the resources through training, and improving workplace
demand for higher-performance housing components is also environments.
increasing. At the same time, the workforce in the Japanese
construction industry is aging rapidly, with one in three
workers now aged 55 or above. As these older workers retire,
the decline in the number of construction workers is expected
to continue. In light of these trends, it is critically important to
recruit and train new employees while also improving the
workforce retention rate.

33 Sekisui House Sustainability Report 2015

 Risk management

Risk Risk

1 Sharp increase in cost of materials 3 Shortage of trucks and drivers

Our Our • Centrally controlling delivery schedules
response • Increasing yields response

1 • Improving production efficiency

• Using new or alternative materials
3 • Establishing a line-haul system centered on distribution bases, along with
a local distribution system
• Increasing the operating rate of existing trucks
Risk • Optimizing the distribution system, including deliveries from component
2 Shortage of workers suppliers
• Reducing the workload of drivers (implementing labor-saving measures,
Our shortening driving distances)
response • Automating production lines to accommodate a reduced workforce
2 • Reducing production lead times Risk
• Increasing prefabrication to reduce the workload at construction sites
• Promoting a just-in-time distribution system to improve work efficiency at 4 Quality risks
construction sites Our
• Rationalizing construction schedules and promoting effective use of the response • Promoting quality risk management
workforce through efficient allocation of human resources
• Training young technicians at schools to ensure a competent workforce
4 • Boosting the quality of components and construction by cooperating with
partner companies
• Developing multi-skilled technicians capable of working flexibly in various • Operating a group-wide construction quality control system
fields of expertise Risk
• Boosting the retention rate of employees by improving the workplace
environment, enhancing welfare programs, and providing support for 5 Natural disasters
training and qualification tests
Our • Promoting our business continuity plan (BCP) in cooperation with partner
• Accepting foreign trainees response

5 companies
• Establishing a post-disaster reconstruction system in cooperation with the
Sekisui House Association
• Using factories as makeshift shelters and stocking them with emergency
supplies
• Promoting the Disaster Risk Reduction Factory of the Future plan, a joint
public–private project for community-based disaster preparedness
Implementing
action plans

Automating the production of main structural developed, it was manufactured almost completely by hand.
components and exterior walls Since then, we have upgraded and streamlined the
Since we build detached houses to specifications tailored to production line. In 2010, we introduced 17 industrial robots at
each customer, the components we use also differ from one our Hyogo Factory (Kato City, Hyogo Prefecture) for mass
house to another. By automating our production lines, we production of Dyne Concrete. By continually improving
strive to ensure a stable supply of components that excel in production systems and making effective investments in plant
performance, quality, and precision. That, in turn, enables us and equipment at other factories as well, we are aiming for
to fully utilize the benefits of industrialized housing to further production efficiency and higher quality.
accommodate a wide variety of customer-specific design
needs. Expanding distribution networks to achieve
In 2010, we automated the production line for the NewB higher efficiency
System structural component at our Shizuoka Factory Sekisui House operates distribution bases in seven locations
(Kakegawa City, Shizuoka Prefecture) by introducing 127 across Japan: Kanagawa, Niigata, Aichi, Shiga, Osaka,
industrial robots. As a result, the rate of automation has Okayama, and Fukuoka. Housing components built at our
increased from 60% to 95%, allowing us to operate the factories are gathered at these distribution bases, where they
production line around the clock and to establish a are sorted and then shipped to the appropriate construction
build-to-order system for accommodating customer-specific sites. We are implementing a just-in-time inventory system
designs. Furthermore, as the new system enables component that allows us to adjust the schedule and quantity of
production to be optimally timed to match the construction component shipments on an on-demand basis to optimally
schedule, it helps improve efficiency in both shipping and match construction schedules. Furthermore, trucks
construction. In 2013, we introduced a similar robotized line dispatched from these distribution bases make rounds to
at our Kanto Factory (Furukawa City, Ibaraki Prefecture). With collect waste materials and tools from each construction site
a system for mass production in place, in March 2014, we and bring them back to the bases. To increase work efficiency
unified construction methods for steel-framed two-story at construction sites, the distribution bases are also used for
houses under the advanced Universal Frame System, which assembling some of the housing ng components.
incorporates our NewB System.
Line-haul system Local distribution
We also produce, on a Bulk shipment to Shipment timed to match
house-specific basis, our distribution bases using construction schedules
large trucks
original Dyne Concrete Construction Tohoku Factory
Distribution bases (hubs)

exterior-wall component, sites

Hyogo
which is made using unique Factory
Factories

Kanto Factory
Construction Yamaguchi
Factory
raw materials and production sites
Shizuoka Factory
methods. Thirty years ago, Construction
Coating line for Dyne Concrete applies 4 layers of
when Dyne Concrete was first coating to enhance durability and weatherability sites
Factories Distribution bases (hubs)

Sekisui House Sustainability Report 2015 34

 Focused on Creating Shared Value
CSV Strategy 3

Developing and implementing an industry-first us to plan lean, achievable schedules and allocate human
liquefaction countermeasure for housing resources where and when they are needed, thereby maximizing
One of the effects of the 2011 Great East Japan Earthquake was construction competence. As a mechanism that supports work
soil liquefaction that damaged many homes, including some built planning, the work schedule system includes two important
on reclaimed land in the Tokyo Bay functions: one for easily generating schedules for each customer
area. In response, Sekisui House and another for identifying the workload for upcoming projects.
pushed forward with R&D into a The work schedule system allows us at an early stage to
liquefaction countermeasure that ascertain the required workforce for a given type of project. As work
could be applied to detached schedule information can be shared across all Sekisui House
houses and rental housing with branches, any branches located near one another can check their
four stories or less. By April 2014, respective work volumes and, where necessary, provide mutual
we had developed the SHEAD personnel support. We are putting this schedule system into
Conceptual diagram of SHEAD
method and established a system practice throughout Japan, with the aim of reducing worker
for delivering it in response to customer requests. vacancy days and maximizing income.
SHEAD is a soil reinforcement method that involves injecting a
series of stone columns in the ground (using a deep mixing Training young technicians at school
process) to create subterranean walls that enclose and bind the soil To maintain quality and further improve our construction capabilities
into a grid pattern. This method mitigates soil deformation during into the future, Sekisui House runs the East Japan Sekisui House
earthquakes and inhibits liquefaction of the soil in the grid. As well Training School (which has been approved by the governor of
as preventing buildings from sinking and tilting, SHEAD reduces Ibaraki Prefecture) and the West Japan Sekisui House Training
damage from sand boils and water spouts. School (which has been approved by the governor of Yamaguchi
The SHEAD method is an application of the grid-pattern soil Prefecture). New employees of Sekiwa Construction companies
improvement technique, which has a proven track record of and of our building contractor partners receive training on
preventing liquefaction in large-scale construction enterprises such construction methods, business practices, and etiquette. They are
as civil engineering projects and large buildings. In adapting SHEAD groomed to be technicians ready for active duty on the front lines of
so that it would be similarly effective for small housing, we the construction business.
established a new design method and a new construction method What distinguishes our schools from others is the fact that
that uses small-scale soil improvement equipment. With SHEAD, students acquire not only the knowledge and skills required for
we are now able to provide an affordable full-fledged liquefaction housing construction, but also
countermeasure for houses. an insight into a corporate
philosophy oriented towards
Strengthening on-site competence through delivering greater satisfaction
prefabrication to customers. In FY2014, a
To enhance our construction capacity, it is essential to provide total of 91 people completed
environments where personnel can work comfortably and efficiently. their education at these
To this end, Sekisui House departments are working together to schools. Those who have
strengthen on-site competencies. We have analyzed and completed the training course
categorized the roughly 700 requests for workplace improvements are promptly put to work
we have received from construction sites across the country, and around Japan as skilled
we have devised and implemented improvement measures in order construction workers and
On-site training for slinging
of their urgency and importance. construction site managers.
As part of our efforts, we have significantly increased the rate of In response to the growing number of enrollees, we reopened
prefabrication—including precutting, presetting, and partial the Central Japan Sekisui House Training School (which has been
assembly of components—to approved by the governor of Shiga Prefecture) during FY2015.
minimize the need for on-site
component processing and to My Idea-21—Proposals for improving construction
ensure consistent My Idea-21 is a system we started in 1988 as a way for employees
construction quality. and building contractor partners to submit their suggestions for
Minimizing on-site processing improvements. Sekisui House gives recognition and support to
not only helps us to save ideas covering a range of areas, such as improving the
To reduce the workload at construction sites, metal fittings
energy, it also serves to are pre-attached to structural frames, which have been competence of construction workers or raising customer
precisely precut via computer control
minimize the environmental satisfaction levels. Once a year, the company solicits ideas for
impact on neighborhoods—for example, by reducing airborne dust. practical improvements in construction methods and new
In addition, we are enhancing construction efficiency through architectural techniques. An impartial panel of judges rates the
measures that include reorganizing our split delivery system (which ideas and awards the best submissions a certificate and a
involves subdividing delivery routes) and promoting floor-specific monetary reward.
delivery and customer-specific labels for interior materials used in The 27th edition in 2014 saw 1,185 ideas come in from across
the construction of Sha Maison apartments. Japan. Two Gold, nine Silver, one Environmental Bronze, and 31
Bronze awards were given out. Through this system, we have
A work schedule system that maximizes received a total of 48,463 proposals, many of which have given rise
construction competence to new tools, equipment, and construction methods. Some have
We have developed a work schedule system as a tool that enables become commercially available, and for some we have obtained

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 Improving Production and Construction Quality

patents. Award-winning ideas are introduced in our Tsuchioto

newsletter and on our company intranet, so they can be shared by Key performance indicators (KPIs)
everyone at our construction sites and among our employees and
building contractor partners across Japan. FY2012 FY2013 FY2014

Per-capita productivity
(factory shipment value ÷ number of workers) 100.0 110.1 99.8*
Number of construction workers
(foundations, construction, carpentering) 10,249 10,899 10,518
Number of technicians who completed training
course at school (cumulative total) 2,208 2,294 2,385
Number of certified Sekisui House Senior
Technicians (cumulative total) 14,301 14,458 14,607
Number of certified Construction Meisters 205 312 318
This bracket for fixing scaffold planks won a Gold prize This wall-fixture plate also won Gold *Reduction due to decrease in shipped houses and surface area

VO I C E

Winning the Gold prize at the 27th My Idea-21 contest (2014)

The bracket I designed for fixing scaffolding planks lets you I’m constantly trying new things to improve the
easily fix a plank to a ladder with a single touch and without efficiency and safety of construction work. When I have
the use of a fixing band. It gave me my second consecutive free time, I visit DIY stores and hardware stores to look
Gold prize, following the one I won in 2013 for an for hints. I’ll keep up this work so I can contribute in any
inner-wall-frame mounting jig. I’m honored to receive such way to raising the level of quality and boosting
high recognition. customer satisfaction.
Hideo Nakamura, Seimiya Corporation (a building contractor partner of Sekisui House’s Chiba Minami branch)

TOPICS
Is Series—30 years on and better than ever New construction method for Shawood
wooden-frame houses
The Is Series is a brand of high-quality, high-performance,
steel-framed detached housing that incorporates Dyne Concrete, our After developing a new construction method for wooden-frame
top-quality originally developed exterior-wall material. Since the debut houses called Hybrid S-MJ, we began employing it in all of our new
of the series in 1984, we have built more than 70,000 Is Series wooden-frame houses starting late August 2014. The Twin SP Wall
houses. The Is Series has become a long-selling brand in the housing used in Hybrid S-MJ is a bearing wall (brace) boasting the highest
industry. strength in the industry; it is twice as strong as our previous S-MJ
In 2014, to mark the 30th anniversary of the Is Series, we boosted method and four times stronger than conventional construction
its basic performance and methods. It owes its strength to double-layered structural plywood
thereby raised its value as and high-load-bearing connecting metal joints.
housing stock. This was Hybrid S-MJ also includes the Shawood Hybrid Structure, which
achieved in part by adopting provides the rigidity of a monocoque structure along with the benefits
the Tough Clear 30 Hybrid made possible by a rigid-frame construction—that is, wide, spacious
photocatalyst for the exterior openings. Previously, the use of bracing boards and wooden
coating to improve rigid-frame posts in the same building was not permitted, owing to
resistance to grime buildup. differing levels of deformation in the two components under
The coating’s high level of simultaneous horizontal loads, such as those from a seismic force.
This earthquake-resistant house reflects our “slow living”
weatherability and durability concept, with spaciousness made possible by wide But under our new construction method, braces and rigid-frame posts
allows these houses to go windows and doors exhibit the same level of rigidity. It is the only method in the industry
30 years without the need for exterior maintenance. For the houses’ that has been approved for use in wooden-frame houses, having
construction, we employed the advanced Universal Frame System, been officially certified as meeting Japan’s Building Standards Act.
which incorporates our NewB System. This gives houses the highest We also developed the Hybrid SR Floor Beam, a structural
level of earthquake resistance achievable under Japan’s housing component that integrates engineered
performance indication system and also gives architects a degree of wood and steel and that offers a high
design freedom. level of rigidity under loads applied
Thanks to these improvements, Is Series houses feature attractive from above. With the new Hybrid
exterior designs that homeowners of successive generations can S-MJ system, we are able to build
cherish. Is Series houses can also accommodate designs with large, earthquake-resistant houses with a
open interior spaces, wide windows and doors, and spacious very high degree of design freedom.
double-height ceilings. And superb heat insulation gives these houses This includes houses on land with
a higher-than-usual level of comfort. Through the evolution of the Is strict architectural demands and in
Series, we are working to spread the adoption of houses that provide areas prone to heavy snowfall, as well
customers with high asset value and that are highly valuable as as three-story houses that require
Wooden rigid-frame construction allows
housing stock. greater levels of structural strength. house designs with wide openings on three
sides and a large built-in garage

Sekisui House Sustainability Report 2015 36

 Focused on Creating Shared Value Extending the Lifespan of Houses
and Enhancing After-Sales Service
CSV Strategy 4 Helping to build a society in which houses support generations of
affluent living, based on eco-friendly use of resources

Raising the asset value of houses in Japan and

Backdrop
turning them into assets that benefit people and society
As of 2013, the appraisal value of housing stock in Japan was Total amount of housing investment and housing asset value in Japan
about 350 trillion yen—roughly 540 trillion yen less than the Why asset value is far lower than
total housing investment figure of 890 trillion yen. What this investment amount
Asset appraisal:
means is that housing in Japan, unlike that in North America Set as replacement cost with depreciation 2013: (trillion yen; real value)
900
and Europe, is generally not an appreciating asset. Given that • Reflecting the housing situation in Japan, asset value 893.3 trillion yen
is calculated under the assumption that housing rapidly
housing is typically the bedrock of a household’s assets, the 800 depreciates in value within several years of being built

low asset value of houses in Japan represents a loss not only 700
in macroeconomic terms, but also in the way it affects Asset value is 540 trillion
600 yen less than total
people’s lives. amount of investment 2013:
As more quality housing stock is brought to market and 500 349.8 trillion yen

as housing appraisal values rise, senior citizens will have 400

greater security regarding their retirement living expenses and
300
young adults will be able to reduce their rent payments either
by choosing housing that suits their life stage or by living in 200
multigenerational homes. 100
Housing asset value
Housing investment total
For the aforementioned reasons, there is growing demand
0 (FY)
for housing that has excellent functionality, that is well
1969
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001

2011
2013
2009
2003
2005
2007
maintained, and that can last for generations. Source: FY2013 “Roundtable on Stimulating the Resale Housing Market” Report, Ministry of Land,
Infrastructure, Transport, and Tourism

Our goal Enhancing the quality of diverse lifestyles by providing homes that are flexible and durable

We are striving to raise the asset value of houses by turning increasing their resistance to common natural disasters—
them into long-lasting social assets. To this end, we are while also making them flexible enough to readily respond to
boosting the basic performance of houses—for example, by changes in residents’ lifestyle and family structure.
Providing houses where residents can live comfortably over a long time
Group-wide support
Improving durability Construction
1 Physical degradation Introducing SHEQAS seismic control system, weather-proof
painting, rust-proof painting, and passive wall ventilation
Sekisui House

Construction and
Factors that affect the lifespan of a house

Accommodating changes in residents’ lifestyles

Conducting customer surveys and incorporating

remodeling
and family structure
Sekiwa Construction
the feedback into our operations

Conducting research at Comprehensive Housing R&D Institute,

introducing Smart Universal Design, Airkis, and IT-based health Sekisui House Remodeling
Change in residents’ lifestyle
2 management features
Our response

and family structure

Feedback

Maintenance
Providing remodeling services Sekisui House customer
Extending the lifespan of a house by providing remodeling services service centers
that can accommodate changes in residents’ needs
Distribution,
Enhancing maintenance services management,
3 Lack of maintenance Providing thorough maintenance services through our customer
construction
service centers Sekiwa Real Estate

Lack of market demand for Promoting sales of used houses Management, operation
4 used houses
(which results in demolition)
Developing the used house market through Everloop and SumStock
(Platinum)
Sekiwa Grand Mast

37 Sekisui House Sustainability Report 2015

 Action Leveraging the synergy of our group companies to address customer needs and enhance
policies the asset value of the houses we build
We are making our houses more long-lasting by boosting customer needs by leveraging the synergy of our group
basic housing performance through cooperative initiatives in companies to provide meticulous service throughout the life
the supply chain—this is one of the advantages of cycle of a house in the form of maintenance, renovation,
industrialized housing. At the same time, we are addressing remodeling, and relocation.

1 Ensuring customer safety and peace of mind through superb housing performance
Believing that housing should serve as a form of shelter to Percentage of steel-frame houses fitted with SHEQAS and Airkis
(%)
100
protect residents’ lives, health, and property, we uphold 89
87
voluntary criteria that exceed the stipulations of laws and 76
80
regulations. 80
78
• SHEQAS seismic control system 60
59 75
SHEQAS, accredited by the Ministry of Land, Infrastructure, Transport, SHEQAS
and Tourism, converts seismic waves into heat energy to absorb building Airkis
vibrations and reduce building deformation by approximately 50%. 40
36
• Airkis high-quality indoor air system
Airkis reduces indoor concentrations of five types of chemical substances 20
that are the main causes of sick building syndrome. These substances are
reduced to less than 50% of the levels stipulated by the Japanese
0
government guidelines to protect children’s health. 2011 2012 2013 2014 (FY)

2 Dedicated maintenance structure 3 Group-wide efforts in offering the best comfort possible
We believe that the quality of after-sales support is very Houses can be used for several generations. As times and
important, considering that a house can last as long as 100 lifestyles change, so do residents’ demands for comfort and
years. That is why we have assigned 1,400 employees— convenience. Sekisui House group companies work closely
roughly 10% of our entire workforce—to customer service together to accommodate customers’ needs for renovation
centers to provide support to customers across Japan. and remodeling. Our efforts to meet these needs range from
Because these customer service centers are operated by adding energy-saving features to performing large-scale
Sekisui House, we are able to quickly incorporate customer renovations.
feedback into product development and management
systems.

4 Asset values enhanced by long-term warranty and housing history information system
We operate a long-term warranty system that includes a corresponds to the Long-Term Quality Housing Certification
20-year warranty applicable to the structural frame, along with Program in Japan—to share across group companies
other warranties that apply to each housing component for a construction information and other information in digital form.
specified period of time. Owners of houses whose after-sales To accommodate smart houses, which optimally control a
service warranty period has expired can sign on to our U-trus household’s energy usage, we are working towards the
system. This provides extended warranty at 10-year intervals, centralized management of PV systems, fuel cells, storage
on the condition that required inspections, maintenance, and cells, home appliances, housing equipment, and electric
repairs are conducted at the homeowner’s expense. vehicles. We are also working to create a network that will
A house is composed of tens of thousands of enable homeowners to access registered information on their
components. To keep track of them all, the Sekisui House computers.
Group operates a housing history information system—which

Moving in 5th year 10th year 15th year 20th year 30th year 60th year

Legally required period for manufacturer’s Housing Quality

warranty against defects Assurance Act

Sekisui House after-sales service 20-year manufacturer

U-trus system*2 U-trus system*2
warranty period warranty*1
Inspection Inspection Inspection Inspection Inspection Inspection Inspection Inspection

Inspection fees applied for the 20th year and after. The warranty period can be extended repeatedly as long as the home exists.
*1 At Sekisui House, a 20-year manufacturer warranty is applied to structural frames and rainwater-proofing components (rainwater-proofing components are covered by an initial 10-year warranty plus another 10-year warranty) on
condition that free inspections be conducted and maintenance/repairs be made at the homeowner’s expense upon expiration of the first 10 years.
*2 The U-trus system provides extended warranty at 10-year intervals, subject to required inspections and with maintenance/repairs to be completed at the homeowner’s expense.

Sekisui House Sustainability Report 2015 38

 Focused on Creating Shared Value
CSV Strategy 4

Risk management

Shrinking of the market for new houses due to longer-lasting houses

Risk

1 Extending the lifespan of houses may reduce market demand for new houses
Our
response Presently, our share of Japan’s housing market is 5% strong. However, as more people become aware of the asset value of quality housing,
1 we expect that our ability to produce attractive products and provide effective solutions will enable us to expand our market share. To this
end, we are striving to cater to the individual needs of homebuyers with varying lifestyles and family structures.

Difficulty in differentiating ourselves from countless other remodeling companies

Risk

2 Competition may intensify in the remodeling market

Our
response Because we keep customer-specific information in our database, we are able to propose remodeling and maintenance services to
2 homeowners in a timely manner. We also have an advantage over our competition in the sense that homeowners are more likely to trust
remodeling and maintenance services provided by the same company that built their home. And by making bulk purchases of the latest
home equipment, we are able to incorporate it into our remodeling plans without placing an excessive cost burden on customers.

Achievements
Expected benefits

We are aiming to transform Japanese housing culture Shift of sales in remodeling business (billion yen)
Sekisui House detached homes +7.1%
with long-lasting homes that become community Sekisui House rental housing
assets—just like in European countries. At the same Housing built by other companies 134.1
+12.1%
time, we are aiming to raise the value of our houses by +9.2% 18.7
+11.7% 125.0
offering remodeling services with the latest technology
111.5 15.0
to promote comfortable living—now and always. 102.1 11.5
30.5

By establishing solid and ongoing relationships with 91.4 9.1 26.9

7.5 23.6
homeowners, we are able to offer them proposals 22.7
21.4
aimed at accommodating changes in their family
structure or stage of life. This also contributes to the 84.9
76.3 83.0
stability of our business operations and to the 62.4
70.2

enhancement of our brand value.

2010 2011 2012 2013 2014 (FY)

Future developments

Sekisui House has links to its customers through the burden on caregivers, it is important that this
750,000 detached houses and the 210,000 rental technology has a warm, human face. That is why in
houses and apartments we have built. We strive to April 2014 we began collaborating with Muscle
effectively meet the changing needs of these Corporation, an Osaka company specializing in health
customers by continuously improving synergy among care equipment, on joint research and field testing
Sekisui House Group companies. aimed at bringing technologies into homes and nursing
One way we are doing this is by engaging in care facilities. This joint effort has two goals: (1)
creative partnerships with state-of-the-art technology introduce in-home nursing care for the elderly with
companies to accelerate the pace of R&D into the user-friendly robotic technologies; (2) create a
practical application of robotic technologies. The goal is comfortable, natural nursing care environment in the
to provide a higher quality of home living for the elderly home by having robots and humans each perform the
and the disabled. tasks they are best at.
But while we want to use technology to lessen the

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 Extending the Lifespan of Houses and Enhancing After-Sales Service

Platinum Business
Japan’s system of special-care nursing homes and demand for housing for the elderly. It is up to housing
other facilities for the elderly is similar to that of other manufacturers to provide society with housing and
countries despite the country’s rapidly growing elderly housing services that ensure the elderly can live in
population. However, this has not kept pace with the safety and peace of mind.

Allotment of nursing care facilities and housing for the elderly Positioning of elderly care housing and facilities in Japan

Nursing care facilities

Nursing homes
U.S. 4.0 2.2 Housing
Assisted-living complex for senior citizens
U.K. 3.7 8.0 Group homes

Public elderly
Denmark 2.5 8.1 housing

Facilities covered by
Care houses nursing care insurance
Livelihood support homes
Japan 3.5 0.9
Low-priced retirement homes

0 2 4 6 8 10 12 14 (%) Physical Self-reliant or requiring

functional light nursing care Requiring moderate nursing care Requiring intensive nursing care
Source: Subcommittee on Social Services, National Assembly on Social Security status

Establishment of operation and management company Sekiwa Grand Mast, Ltd.

As part of Sekisui House’s Platinum Business, in November Mast building owners to more smoothly take care of the
2014 we established Sekiwa Grand Mast, Ltd. to provide the business of running their rental housing.
elderly with an independent lifestyle they could call their own. In the area of special housing products such as
Rental housing buildings called Grand Mast are rented to assisted-living complexes, we are improving on our operation
tenants by the buildings’ owners, who Sekiwa Grand Mast and solution capabilities so that we can earn the further trust
provides with total support in the form of building of customers and provide the meticulous services needed by
management, subleasing, management consulting, and the growing number of senior citizens who use rental housing.
coordination of various service providers. This allows Grand
Major business schemes
Lease agreement
Sublease
Landowners Sekiwa Grand Mast Safety confirmation services Tenants
Lifestyle consultation services
Nursing Health care
care visits visits
Nursing care Health care
providers providers
Hatano Rehab Home:
assisted-living complex provides health and nursing care
Sekisui House is now offering assisted-living complexes for This type of housing complex allows landowners to utilize
the elderly that provides a range of services through a the land the way they want, and it allows nursing care
combination of conventional small-scale, multi-purpose providers to contribute to local society and earn the trust of
nursing care facilities and regular nursing care visits. communities. It also provides landowners with a stable
Besides lifestyle consultation and safety confirmation, this income over the long term. These assisted-living complexes
housing provides tenants with a wide range of services, are the culmination of the expertise and solution capabilities
including day care and health care, in the comfort of their that Sekisui House has built up over years of experience in
homes and in the region where they want to live, thus meeting housing for the elderly.
all their needs for the remainder of their lives.

Celeblio assisted-living complex for the elderly (45 units; Hiroshima City, Japan)

Day care room Exterior view Inside

Sekisui House Sustainability Report 2015 40

 Focused on Creating Shared Value
CSV Strategy 4

Bringing Quality Housing Stock to Market

Making quality housing stock widely In FY2014, we assessed 2,478 houses (5.4 times the
amount in the previous year) and made sales contracts for
available
499 houses (2.8 times more than in the previous year). The
The Sekisui House Group has long been committed to raising
Sekisui House Group will continue working as one to provide
the quality of housing and extending its service life. That is
total housing solutions, including those for remodeling, while
why we actively participate in the Provision of Quality Housing
offering customers ever higher levels of satisfaction.
Stock Association, an organization that aims to revitalize the
circulation of high-quality housing stock and create a VO I C E
well-organized market for reselling homes. The association
Seller and buyer are both satisfied
includes nine other housing manufacturers and is headed by
When it comes to signing conventional contracts for the sale of
Sekisui House Chairman Isami Wada.
existing houses, customers can be uncomfortable with the
The association has created a definition for high-quality unclear nature of the appraisal criteria in the housing appraisals
housing stock, which it terms “SumStock.” A house must made by house builders. By contrast, SumStock houses built by
Sekisui House have a clear history of maintenance and repairs,
fulfill three conditions to be designated as SumStock. Under
with the original blueprints of the houses also remaining intact.
an appraisal method adopted by all member companies and This gives peace of mind to both the seller and the buyer when
based on the three SumStock conditions, SumStock they sign their deal.
salespersons certified by the association handle appraisal and In a SumStock appraisal, the value of the land and building
are assessed separately and precisely—an advantage over
sales of used houses. A house’s basic structure (“skeleton”)
conventional housing appraisals. Another benefit is that the
and its interior furnishings and facilities (“infill”) are assessed house’s warranty is handed over as is to the new owner.
separately, and the value of the building and the land are I will keep up my efforts to bring more
long-lasting, high-quality SumStock houses
indicated separately. Through this unique system, the
to market, so that there can be even more
association is working to bring a greater number of happy and satisfied customers.
high-quality SumStock houses to market.
The association’s 10 housing manufacturers have so far Naofumi Wakamatsu
Sekiwa Real Estate Kansai, Ltd.
provided 3.2 million houses. Of these, around 20,000 houses
circulate in the used house market each year. Bringing these
houses to market as high-quality SumStock houses Assessment through SumStock appraisal
contributes to solving the social issue of providing According to conventional housing appraisals in Japan, the value of a
longer-lasting houses. 20-year-old house is virtually zero. By contrast, a SumStock appraisal defines
the service life of the skeleton to be 50 years and the infill to be 15 years.
Making separate appraisals for each, it allows a fair and accurate assessment
Group-wide efforts to boost customer of the building’s value to be reached.
satisfaction Assessing skeleton and
infill separately
Appraisal value (image)

The Sekisui House Group employs 469 association-certified Conventional appraisal

SumStock salespersons who work throughout Japan. The

Group also supports the SumStock initiative by using our own
housing history information system—which corresponds to
the Long-Term Quality Housing Certification Program in
Japan—and by having customer service centers, Sekisui 0 5 10 15 20 25 30 35 40 45 50 55 60 (age)

House Remodeling, and Sekiwa Real Estate companies work

(houses)
together. 3,000
Sales contracts Appraisals 2,478
2,500
Renovating when Sekisui House
moving in 2,000
homeowner
Sales 1,500
consultation SumStock appraisal,
Periodic maintenance intermediary 1,000
and patrol 455 499
500 181
Customer service center, Sekiwa Real Estate
Sekisui House Remodeling Sales information companies 0 (FY)
2013 2014

The three conditions for a SumStock house (Source: Provision of Quality Housing Stock Association website)

1 House history The blueprint from when the house was built and information on past remodeling and
maintenance are properly managed and stored.
2 Long-term maintenance program
The house is covered by a long-term inspection and maintenance program of 50 years or more.
3 Earthquake resistance
The house features earthquake resistance as specified under the New Seismic Resistance Code of 1981.

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Boosting Homeowner Value

Ever more houses fitted with SHEQAS Participating in the Private-Sector
seismic control system Housing Safety Net Project
SHEQAS is our innovative seismic control system accredited Sekisui House Remodeling performs remodeling work on
by the Ministry of Land, Infrastructure, Transport, and rental housing properties to make them safe, secure, and
Tourism. SHEQAS converts seismic wave energy into heat comfortable. The company also took part in the
energy to absorb building movement, and it can reduce Private-Sector Housing Safety Net Project*, a
building deformation by approximately 50%. It gives houses government-subsidized initiative that aimed to make full use
the strength to withstand repeated earthquakes. In 2013, we of unoccupied rental housing. When such housing was
released Hybrid SHEQAS, a structural component that remodeled as part of this project, the remodeling costs for
combines a steel-frame brace with a SHEQAS Frame (a common (shared) areas of an apartment building were eligible
Sekisui House original seismic-control wall). Hybrid SHEQAS for subsidies provided that other remodeling work included
maintains its seismic-control capability while enabling a high some form of barrier-free or energy-efficiency remodeling.
degree of flexibility in the design and layout of rooms—for We encouraged owners of rental housing to take part in
example, in making larger windows and doors. In FY2014, the this remodeling project as a way to boost the value of their
percentage of our houses fitted with SHEQAS was 89% (up 2 assets and as a way to contribute to society. Many rental
points over the previous year). housing owners have used this system when remodeling their
Hybrid SHEQAS enables larger windows and doors property—for example, when installing PV systems.
(Note: The project ended on March 31, 2015.)
By prolonging the lifespan of buildings and helping to find
tenants for empty rental units, our rental housing remodeling
Before After
work is a measure that serves to solve social issues. We will
Structure of Hybrid SHEQAS continue searching for other new ways that our remodeling
work can serve society.
Hybrid tal
Sha Maison ren least
h at
SHEQAS apartments wit eligible
SHEQAS 1 empty unit* are
Brace Frame *Units that have not been occupied for at least 3 months
Remodeling empty unit Remodeling building exterior
(mandatory)

Sekiwa Construction Group focuses on remodeling

Optional
The Sekiwa Construction Group, comprising 20 companies Barrier-free
remodeling
remodeling
Handrails, even floor level
across Japan, is a group of companies whose high level of or
construction expertise serves to bolster Sekisui House. Its
Energy-saving
comprehensive business activities include remodeling and remodeling Double-shingle roof Wall painting PV system
Window insulation, water-saving toilets (Note: Systems in which all

construction of wooden-frame housing, remodeling of

generated electricity is sold to a
power company are not eligible.)
Apply for subsidy program
condominiums, and exterior construction work. With each
of remodeling costs provided through grants
company being firmly rooted in the local community and with Note: Grants provided for up to a total of (number of units) x (1 million yen).

the group having a nationwide presence as part of the Sekisui *Under this program, the Japanese government covers a portion of the costs incurred by owners of private-sector
rental housing when they remodel unoccupied housing units (detached houses or apartments), on the condition
House Group, the Sekiwa Construction Group provides that people with special housing needs are given priority when renting those units. The program aims to boost
the value of existing private-sector rental housing and make effective use of unoccupied units so as to secure a
comprehensive support to its customers. We pay close stable supply of housing for people with special housing needs while also establishing an environment in which
attention to what customers want, and we work with them in such rental housing may be used flexibly by the public sector in case of disasters.

proposing remodeling solutions that give shape to the lifestyle

of their dreams. We are dedicated to helping our customers Enhancing the value of houses through
live safely, comfortably, and with peace of mind in their the Everloop home repurchase program
cherished homes for a long period of time. Under the Everloop program, we repurchase existing Sekisui
An example of large-scale remodeling House homes from homeowners, renovate them using our
proprietary technologies, and then offer them for resale. To
To enable two generations to live under the same roof,
the customer remodeled the office space and garage ensure the safety and reliability of homes offered under this
on the first floor. An attractive space was created by program, Sekisui House personnel are in charge of the entire
integrating the open garage and living space. process, from appraisal of the house to relocation of the
homeowner.
Son Mother Mother A FY2015 taxation reform in Japan reduced the real estate
acquisition tax for resellers purchasing old houses, remodeling
Office Garage Son Wife them to make them earthquake-proof, energy-efficient, or
barrier-free, and then reselling them. It is anticipated that this
Before After reform will lead to an expansion of the housing resale market.

Sekisui House Sustainability Report 2015 42

 Focused on Creating Shared Value
CSV Strategy 4

Building a Recycling-Oriented Society

Making houses last longer and recycling resources
We are promoting our housing stock business—which housing materials last as long as possible, to recycle waste
includes remodeling to prolong the service lives of our houses generated during construction, and to use that waste
and address changes in homeowners’ lifestyles—so that our effectively as new resources. It is therefore our mission to
homebuilding projects consume a minimum amount of limited conduct zero waste activities and have other systems in place
resources. We consider it our social responsibility to make for resource recycling.

Past activities
As the industry leader in properly managing waste materials, housing process—namely, production, construction,
the Sekisui House Group operates its own waste disposal after-sales maintenance, and remodeling. We are keeping up
system. Between 2002 and 2007, with the concerted efforts our efforts to achieve and maintain zero waste.
of the entire Sekisui House Group and our building contractor *A concept whereby all waste materials generated during industrial activities are reused as resources and no
waste is emitted on a society-wide basis. Sekisui House defines “zero waste” as eliminating waste sent to landfill
partners, we achieved zero waste* during each stage of the disposal as well as eliminating waste incineration that involves no heat recovery.

Recycling-oriented industrial system and Sekisui House’s progress in achieving zero waste

After-sales maintenance
Remodeling of Remodeling of
non-Sekisui Sekisui House homes New house construction
House homes Virgin materials

Parts (building materials)

Recycled manufacturers, raw
Achieved in 2005 materials material manufacturers
Production
Achieved in 2006 Refining companies, etc.
Demolition Achieved in 2007 Paper manufacturers
Achieved in 2002 Factories, Resource
Management Center Cement companies

Intermediate disposal facilities

Residue remaining after
intermediate disposal
Landfill disposal (portion)

Resource Management Center serves as the core of zero waste activities

Segregated Locations of Resource

storage Management Centers

Temporary storage during Resource

remodeling at customer Management
service centers Centers
Remodeling/
construction sites Arrange
To Resource collection
Management Centers

Online waste management system Total: 13 locations

Request collection 4 centers built on factory premises
Waste manager Collection/ 9 other centers
New construction sites transport company

Waste generated at construction sites includes wood, Sekisui House is the first company in Japan’s construction
plasterboard, wallpaper, and metal fragments. We sort this industry to be certified under the Wide-Area Certification
waste into 27 types and put it into separate on-site collection System*. Under this certification program, we operate our
sacks. The waste is then efficiently transported to 13 own electronic management system for waste control. This
Resource Management Centers located across Japan via involves attaching IC tags to waste collection sacks to keep
trucks used for delivering construction materials to the track of the volume of waste and managing a variety of
construction sites. information online pertaining to the construction sites. This
At the Resource Management Centers, the gathered data is used to streamline the construction process—for
waste is processed or further separated into as many as 80 example, to reduce waste and surplus materials.
different types. It is then delivered to material manufacturers *A certification system under the Waste Management and Public Cleansing Law. Manufacturers are permitted to
conduct waste disposal activities across prefectural boundaries without the need to acquire separate licenses.
to be used as raw materials or sent to intermediate disposal The objective is to ensure waste reduction, proper disposal, and recycling.

facilities for further recycling.

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 Extending the Lifespan of Houses and Enhancing After-Sales Service

Expanding the housing stock business and recycling waste

From one remodeling site to the next, there is great variation Management Centers. There the waste is checked for its
in the amount and type of waste generated. Before starting content and volume and then recycled.
work on a house, Sekisui House Remodeling makes full use The Resource Management Centers also recycle waste
of blueprints and spec sheets of a customer’s house obtained brought in from rental housing managed by Sekiwa Real
from the customer service center to gather information about Estate. When tenants move out of rental housing, we repaper
which materials are needed for remodeling. Waste generated the walls. This waste is recycled. The Sekisui House Group is
on the site is sorted in accordance with designated also focusing on educating employees about resource
standards—following the same procedures used on new recycling as we expand our housing stock business.
construction sites—and then delivered to Resource

Waste from remodeling brought in for recycling Sanitation equipment, including toilets, is securely Dismantling window sashes into metal and glass parts Window sashes dismantled at the Resource
packed Management Center

FY2014 Achievements
Waste reduction
By applying the streamlined Waste volume at new construction sites
(145 m2 house equivalent) FY2013 FY2014
construction method used in 2,500
2,097 1,991
Pro+Nube models to other 2,000 1,787 1,652
house models, we were able 1,520 1,466 1,583
1,500 1,337 1,245 1,441
to reduce waste for all models. 1,076 1,027
1,000
500
0
Pro+Nube (K30) Low-rise rental Mid-rise rental Type B low-rise System mid-rise Sha Wood
streamlined apartments apartments detached housing detached housing
construction model

Reducing surplus materials

Generally, surplus amounts of construction materials are houses becomes considerable. This volume of surplus
delivered to construction sites to prevent work stoppages and materials must be dealt with. To this end, we operate our own
to be used as backup in case materials become damaged electronic management system that enables us to precisely
during delivery. There are also rare cases where the delivered gauge the status of surplus materials, and we have set up a
materials do not meet requirements in terms of color or some project team to implement reduction measures across all
other specification. While surplus materials for a single house group companies.
may not amount to much, the combined total for many

Key performance indicators (KPIs)

Category Indicator Unit FY2010 FY2011 FY2012 FY2013 FY2014 Definition

Total resource input 1,000t 1,083 1,096 1,112 1,286 1,079 Amount used at our factories

Waste from new construction,

Volume of waste generated 1,000t 298 309 311 362 728* remodeling, and demolition

Prolonging Volume of waste generated at Amount per house (per 145 m2)
new construction sites kg 1,308 1,396 1,441 1,449 1,485
lifespan of
housing and Proportion of houses with Long-Term
% 88.7 90.9 92.1 92.1 92.1
enhancing Quality Housing Certification
after-sales Proportion of houses fitted with
support SHEQAS % — 58.5 75.0 87.0 89.0

Proportion of houses fitted with

Airkis % — 67.4 76.3 77.8 80.0
Proportion of responders who
Customer satisfaction survey % 38.4 39.2 39.6 41.0 41.9 answered “Highly satisfied” on a
7-point evaluation scale
*Including waste from affiliated companies and waste from demolition of buildings

Sekisui House Sustainability Report 2015 44

 Focused on Creating Shared Value
Promoting Diversity
CSV Strategy 5 Tapping the capabilities and potential of employees and creating a
work environment where people with diverse backgrounds respect
one another

Responding to diversifying customer another. Our efforts were recognized in 2013 and 2015, when
Backdrop
needs with a diversity of human resources we made the Nadeshiko list—a women-empowering roster
In order to achieve sustainable growth despite Japan’s selected by the Tokyo Stock Exchange
declining birth rate and aging population, it has become and the Ministry of Economy, Trade,
essential for companies to create a corporate culture where a and Industry.
diversity of human resources—including people with
disabilities—can fully demonstrate their competence, To be indispensible to society as a corporate
Our goal
regardless of their gender, age, or nationality. Particularly in group that generates high added value
the housing industry, where customer needs are becoming We believe we can bring forth useful innovations by
increasingly diversified, there is a growing imperative to establishing a workplace environment where a variety of
incorporate the perspectives of diverse human resources, personnel can fully demonstrate their abilities in a spirit of
including women. creativity and innovation and where employees join forces
The Sekisui House Group is promoting workplace toward a common goal. As a corporate group that generates
diversity because we believe that creating a work environment high added value and that follows a path of sustainable
where employees can demonstrate their abilities while growth, we strive to be indispensible to society.
respecting each other’s working styles enables us to create
“comfortable housing and ecologically sound communities”— Continuously focusing on three
Action
a policy objective we have been pursuing since our founding. policies priority themes
We also consider diversity to be an effective solution to
We will continue our diversity efforts under three priority
Japan’s declining workforce population.
themes: 1) female career development, 2) work-life balance,
In March 2006, we announced the Declaration for Human
and 3) employing people with disabilities.
Resource Sustainability as our basic personnel policy. The
declaration comprises three basic policies: encouraging • Major stakeholders
female employees to pursue their career development; Employees, job applicants (students, housewives, etc.), investors
promoting a diversity of human resources; and supporting a • Measures being implemented
work-life balance. Since the launch of the Diversity Supporting female employees in their career development
Development Team that same year, we have been striving to Policy
advance the careers of female employees by organizing
When it comes to responding to diversifying customer needs, it is
gatherings among female salespersons, technical personnel,
increasingly important to take account of women’s perspectives.
and model home staff, and by helping them achieve a
We actively hire female employees for sales and technical jobs, and
work-life balance.
we support their career development. By developing them into
In February 2014, our Corporate Management Planning
candidates for management positions, we are expanding and
Department set up the Diversity and Inclusion Promoting
improving our ability as a company to respond to customer needs.
Office, so that we could achieve sustainable management
that allows for a workplace environment where employees
can bring out their full potential while showing respect for one
Employees with diverse career paths and
values work together
(Hyogo Sha Maison Branch)

45 Sekisui House Sustainability Report 2015

 For sales staff Promoting a work-life balance
Every year, we hold a special personnel meeting for female sales staff Policy
where employees who have made a distinguished sales contribution We support diverse working styles that involve balancing work with
are recognized, information on best practices is shared, and parental care and nursing care, so that employees can lead a
discussions are held to inspire and motivate them. In 2014, we began fulfilling life. Measures include reducing overtime and encouraging
holding information exchange meetings for sales staff aiming to annual leave and men’s parental leave.
become office managers. At these meetings, seasoned office managers
teach participants about diverse working styles and potential future We have introduced flexible working styles that encompass reduced work
career paths. hours or flextime. We also provide measures to support employees in
Female sales personnel who have been designated as “role models” taking care of ill or elderly family members, along with a Retiree
are granted benefits such as the ability to adjust holidays and work Reinstatement Registration Program of preferentially rehiring those who
hours during times of maternity and parental leave or change their have left work for some unavoidable reason—for example, to give birth,
workplace location when their spouse has been transferred. raise children, or provide nursing care.
Sekisui House Remodeling has been actively hiring female
Systems to support balancing work and childcare
personnel with parenting experience to work as Remodeling Advisors.
Thanks to the variety of working style options we offer—for example, a Female employees in childcare
Male employees
four-day workweek—our employees are able to strike a good work-life Superiors in childcare
Pregnancy,
parental leave Return to work
balance. The company employs 657 female sales personnel—fully
62% of our entire sales force. And in March 2014, two female
Guidebook on balancing work and childcare
employees became company board members (making up 11.8% of the • Meeting with your boss before and after maternity leave
board of directors). • Working styles after returning to work
Communication • Explanation of support programs

For technical staff

When it comes to recruiting female staff, the technical division has
been even more active than the sales division. In design, we have one Magazine on Intranet site
returning to work • Introducing role
female design chief and 13 female chief architects*. In R&D, female after parental leave models from female
and career sales staff, technical
employees are contributing product development ideas from their personnel, and model
development
unique point of view. In October 2014, we opened the Sekisui House home staff
Career Mom’s Bible
Women’s College, where students acquire the abilities fit for
manager-level jobs in a two-year program. Twenty selected employees
SNS (Sekisui House career development site)
are learning about business skills (first year) and ways to solve
Career Mom Salon
workplace issues (second year). • Information exchange between parental leave
takers and working mother mentors
*In-house qualifications are given to those who have demonstrated excellent skill in housing design and
business negotiations. • Information exchange between parental leave
Networks

taker and boss, and bosses of parental leave takers

Female construction superintendents are actively at work on
construction sites, showing attention to detail and proposing concrete Study group on balancing Women’s exchange meeting
solutions for better living. The number of these superintendents is career and family life (by region)
(married employees, parental leave • Sharing role model examples
increasing: in 2014, we assigned female construction superintendents takers, work returnees) • Networking
• Case studies • Information sharing among
to all nine branch offices operating under the Kanagawa Sales • Group discussions bosses and colleagues
Administration Headquarters, and in December we held the first edition
of a special gathering for the women working in these roles. Consultation on balancing career and family life
Personal support

We set up temporary women’s washrooms—jointly developed with

Trial telework
working styles

the city of Sendai (see p.

Diverse

68)—at our construction Mobile work

sites, to make the work Individual needs
environment more
comfortable for female • Reduced work hours
Systems

construction workers and • Flextime Parental leave for men

• Others
superintendents.
Female construction superintendents from Kanagawa Sales
Administration Headquarters

VO I C E

Since returning from parental leave, I’ve been using the care of children and elderly parents.
reduced-work-hour system to work while taking care My goal is to create a work environment where the
of my twins. I design detached houses and residential demands of childcare don’t overly impinge on one’s
complexes, and although my work hours are limited, I work. I hope to contribute to a better workplace for
find it rewarding to be able to work as a specialist. everyone using the reduced-work-hour system,
Recently, more and more customers are choosing me whether for childcare or nursing care.
as their design rep, thanks to my experience in taking Naoko Kitazawa, Design Department, Tokyo West Branch

Sekisui House Sustainability Report 2015 46

 Focused on Creating Shared Value
CSV Strategy 5

Employing people with disabilities

Policy Since FY2006, we have been running a system that provides
employees with additional opportunities to further their careers. This
Working with people with disabilities enables us to deliver new
system enables employees in clerical work, production, or
value and influence to our customers and our workplaces, and it
region-specific work to switch to sales/technical work. Of the 16
enables us to make better proposals for our customers through
personnel who used this system in FY2014, two were disabled
universal design. Our aim is to hire at least one person with a
employees.
disability at every business office.

VO I C E
In addition to offering internships to people with disabilities, we
promote communication with people with disabilities and their support My work involves giving presentations to customers and
groups. We also participate as a founding member in the Accessibility teaching young tech employees and model home staff
Consortium of Enterprises (ACE). ACE is a group of companies working about CAD. After becoming disabled in a car accident, I
to establish a new business model for employing the disabled in a way had to quit my job as a carpenter. Luckily, I was able to join
that benefits corporate growth. In FY2014, we took part in a working Sekisui House. Now, in my design work
and presentations, I use my experience as
session to study how to instill in disabled students a sense of career
a carpenter to give customers something
development at an early stage. After gathering questionnaires filled out beyond their expectations.
by young disabled employees at member companies and conducting
interviews of support offices at universities, we held a career
Yasuyuki Miyamoto, Design Department, Tsukuba Branch
development seminar for disabled students.

• Target number and time frame

FY2013 FY2014
Target
Achievement Achievement Evaluation

Number of female personnel in

FY2020
managerial positions (group-wide) 65 (1.52%) 101 (2.26%) 200
(5%; 10% in the future)

7 12 Minimum 1 female office manager

(or at least office sub-manager)
Number of female office managers* (6 out of 16 sales (8 out of 16 sales at each of our 16 sales administration
administration headquarters) administration headquarters) headquarters

Employment rate of people with

1.97% 2.08% 1
Minimum person at
disabilities* every business office

Proportion of male employees who took FY2015

parental leave 3% (16 people) 19% (119 people) 30%
*Sekisui House, Ltd. only

Risk management

Risk

1 • Employees on parental or nursing care leave may miss opportunities to expand their abilities, owing to their
absence.
• If the proportion of employees on parental or nursing care leave grows too high, the company may not be able to
allocate work appropriately.
Our
response We are providing employees with the opportunity to establish a vision for their career paths, while taking an inventory of business procedures and
1 establishing systems for flexible working styles. We are also creating a workplace environment that supports both childcare/nursing care and
career development, by informing leave-takers about work developments through monthly online newsletters and other informative tools.

Risk

2 In Japan in 2018, the legally mandated employment rate of people with disabilities will be amended to include a
proportion of the mentally disabled. The Sekisui House Group’s disabled employment rate may fall below that
mandated by law.
Our
response Our aim is to hire at least one person with a disability at every business office. In order to achieve this goal, members of our personnel division
2 attend job-matching events and contact the job placement divisions of public institutions and universities. We also actively gather information
through ACE and strive to create a work environment in which people will want to continue working.

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 Promoting Diversity

Expected benefits

Supporting female employees in their career Promoting a work-life balance

development
We are establishing a system that provides a forum for
By increasing the number of women on staff, we are employees to demonstrate expertise they have
able to readily respond to diversifying customer needs gathered through their experiences of important life
both in sales and technology. events, such as marriage, birth, child-rearing, or caring
for the elderly. This system enables us to make a wider
Employing people with disabilities range of proposals that better incorporate residents’
perspectives and thereby boost customer satisfaction.
The perspectives, sensibilities, and experiences of
employees with disabilities can give us new insight into
proposals and technical R&D. This serves to heighten
awareness of issues surrounding universal design and
prompt more applications in this area.

Key performance indicators (KPIs)

Group achievements

FY2012 FY2013 FY2014

Proportion of female managers 1.68% 1.52% 2.26%
Number of female managers 65 65 101
Number of female board members 0 0 2
(Sekisui House Remodeling)

Male 16.83 16.87 16.88

Average duration of work
(years)
Female 9.18 9.41 9.53
Difference between male and female 7.64 7.46 7.35
Number of employees who Male 19 16 119
took parental leave Female 131 210 242
Number of employees who took nursing care leave 6 11 6
Proportion of employees who Male 100% 100% 100%
returned from parental leave* Female 94.1% 93.0% 93.3%
Retention rate of employees Male 95.5% 100% 100%
12 months after returning
from parental leave* Female 98.8% 100% 94.7%
Proportion of employees who took annual paid holidays 27.3% 27.5% 31.7%
Proportion of employees with a disability* 1.89% 1.97% 2.08%
Proportion of offices that have at least one 54.2% 59.4% 59.6%
employee with a disability* (91 out of 168 offices) (101 out of 170 offices) (99 out of 166 offices)

*Sekisui House, Ltd. only

Number of employees who returned from parental leave and stayed with the company in FY2014 (Sekisui House, Ltd.)
Male Female Total
Number of employees entitled to parental leave*1 458 140 598
Number of employees who took parental leave* 2
102 157 259
Number of employees who returned from parental leave*3 100 125 225
Number of employees who stayed with the company 12 months after returning from parental leave* 4
13 108 121
*1 Employees with a family member born in FY2014
*2 Employees who started parental leave in FY2014
*3 Employees who have returned from parental leave in FY2014
*4 Employees who returned from parental leave in FY2013 and are with the company 12 months later

Sekisui House Sustainability Report 2015 48

 Focused on Creating Shared Value

CSV Strategy 6 Developing Overseas Business

“Changing the world through living”—Raising housing standards
around the world

Expanding beyond domestic industry

Backdrop Our goal “Changing the world through living”
to encompass global industry as well
Infrastructure building and tourist promotion are sectors that In our international business expansion, we are acting based
hold promise for economic stimulation in Japan. Growth on shared goals as identified in our global corporate
strategies can be propelled by taking on challenges related to message.
energy and the environment, and by developing technologies
for these fields that can be utilized in Japan and around the What Home Can Bring to the World
world. Globalization is moving ahead in all industrial sectors, We at SEKISUI HOUSE not only continue to build houses, but create homes and communities
and in the housing industry as well we must utilize the that become essential assets to society while constantly considering the global environment
and high quality community development.
expertise we have built up in high-quality community building
Needs for homes and communities change over time. Through our advanced technologies
and home building to develop new business in countries that achieve better “health,” “safety” and “security,” and comprehensive researches to
where new housing demand is imminent. This comes from understand the ways of living in each country and region, particularly in “culture,” “generation”
and “lifestyle” we will continue to make today’s comfort even better for tomorrow.
our desire to not just move Sekisui House forward but also to Our creativity to freely design every home differently to fulfill and exceed the desires in
protect the global environment. Our overseas business living according to each customer. Our ability to build homes with superior standards in
performance and quality by developing housing materials that leverage leading edge
expansion is part of our CSV strategy.
technologies at our local factories, so the highest level of living comfort can be delivered to our
customers around the world. These innovations are integrated into every SEKISUI HOUSE.
For a lasting relationship with and further satisfaction for our customers through homes,
we will leverage our proven expertise and knowledge cultivated over half a century in Japan to
evolve even further as a leading innovator in home and community development.
We will continue to build on our performance through our conviction that high quality
homes will be essential assets to society. We are committed to continually provide higher levels
of living comfort for today and tomorrow.

Changing the World through Living

One Central Park, a high-rise condominium in the Central Park project in

the heart of Sydney, Australia

49 Sekisui House Sustainability Report 2015

 Carefully selecting markets around the world
Action policies
where we can offer quality housing in high volumes
• Use the high-quality housing technologies we have built up over the years and our know-how in sustainable community
development to develop communities and build homes that match local cultures and customs and that offer safety, comfort, and
peace of mind.
• In countries where we do business, besides proceeding steadily with existing business, continue to pursue new leads in order to
achieve an overall balance of our business.
• Build cooperative partnerships with outstanding local companies in order to better develop business that meets local needs.

Building risk management systems together with experts specializing in risk

Risk management
management so that we can reduce risk and strengthen internal control
Risk

1 Risk of harm to Sekisui House overseas employees due to things such as political instability and terrorism
Our
response Sekisui House chooses to enter the market of countries that are safe and have stable governments; our criteria for entering a new market include
1 population growth and stable economic growth, and the willingness of people in that country to eagerly join us in pursuing environmental protection
and energy efficiency in housing.
In times of social stability, the International Business Department gathers risk management information on countries we will enter or have
business trips to, and we work with risk management specialty companies to build risk management systems and come up with measures to deal
with crises when they occur. We also have a manual for overseas risk management as part of our efforts to reduce risk.

Risk

2 Risk to the management and control of overseas subsidiaries

Our
response Our International Business Department collaborates with experts in countries where we do business. We also strive to improve our internal control
2 system in other ways; for example, in February 2015 we established the International Internal Control Promotion Office, and we work with internal
control consultants whenever necessary.

Risk

3 Risk to intellectual property

Our
response Although it is difficult to completely prevent intellectual property infringement from, for example, the production of imitation goods, we are securing
3 the rights both in Japan and overseas for key technologies and trademarks so that even if imitation goods do appear on the market they do not
interfere with our business.

Implementing Expanding our overseas business positioning the United States, Australia, China,
action plans and Singapore as key markets

United States
In the U.S., we are pursuing real estate development for proceeding and some will be completed and accepting
residences (communities) and urban rental apartment tenants sometime in 2015.
development (multi-family housing). By adding to our business
the stable profit base provided by the former and the potential
capital gains of the latter, we can build a balanced business
portfolio and respond flexibly to changes in the economy. In
both of these businesses, we are working with outstanding
local developers who have proven themselves in the
respective markets so that we can have access to rare and
valuable business opportunities. In real estate development
for residences, Cinco Ranch in Houston, Texas and two other
Sekisui House developments made the list of the top-ranked
master-planned communities in the U.S. in 2014. And many
other Sekisui House developments were highly evaluated and
honored for features such as their highly aesthetic design and
environmental performance. Urban rental apartment
developments in cities such as Seattle and Los Angeles are Summerwood (Houston, Texas)

Sekisui House Sustainability Report 2015 50

 Focused on Creating Shared Value
CSV Strategy 6

Australia
From large-scale condominiums and community Central Park complex in the center of Sydney. Utilizing
developments comprising several thousand lots to Shawood environmental technologies such as wall greening and
wooden-frame detached houses, we are expanding our trigeneration, One Central Park was named Best Tall Building
housing business in Australia. Worldwide in 2014 and Best Innovative Green Building at
In the field of condominiums, Sekisui House and Frasers MIPIM* in 2015, the first building by a Japanese company to
Centrepoint Limited jointly developed One Central Park in the earn these honors.
In the Shawood business, we provide a high standard of
housing by using our Japanese know-how and technologies,
which we complement by coming up with house designs and
specifications that match climatic, environmental, cultural,
market, and social needs.
In six years of business in Australia, we have provided
homes to approximately 6,500 families. We will survey these
families so that we can reflect their opinions and ideas in
future housing construction and community development and
thus contribute to Australia’s housing culture.
A Shawood home in Coolum Beach (north of Brisbane) *MIPIM: Le marché international des professionnels de l’ immobilier

VO I C E

I had been looking for a new home for two to before. Upon entering, I felt a comforting
three months before finding a new release of warmth that I had not experienced in any
Sekisui House’s Shawood homes advertised other home. The extensive open plan living
at The Hermitage. I immediately contacted areas and centralized gourmet kitchen just
the sales team to arrange an appointment brought it all together. Everything about the
and couldn’t contain my excitement following Shawood home was impressive, from the
my initial inspection. The beautiful and revolutionary structural components and
relaxing Hermitage estate was the perfect integrated wall system through to the onsite
location for my family and was just what we workmanship and high standard of quality
were looking for. The distinctive architectural inclusions. I was pleasantly surprised with so
features and unique design of the Shawood many features and right away I knew that this Julie Alfonzo
Julie (sitting) with Sekisui House sales staff in Australia
home was nothing that I had ever seen was the home for me.

China
In China, we have large-scale projects that match the local By offering high-end condominiums for a whole new
atmosphere and culture in Shenyang, Suzhou, Wuxi, and lifestyle along with the convenience of living in the heart of the
Taicang. city, Sekisui House will continue to sell and service homes
The Yuqin Residence in the Heping district of Shenyang is that contribute
located in a key area of the city with a high concentration of to increasing
commercial facilities. It is a high-rise condominium that stands diversity in living
out among other buildings in the district for its modern environments.
design. This building offers a diverse range of floor plans,
making it easy for customers to find a unit that matches their
particular needs. Units were designed with the comfort and
health of residents in mind; for
example, there is ample closet
space for shoes, the interior
building materials contain no
harmful chemicals, and a
soft-water system provides water
that is gentle on residents’ skin
and hair.

The interior of a condominium in the Yuqin Residence in the Heping district of Shenyang Artist’s rendering of the completed Yuqin Residence

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 Developing Overseas Business

Singapore
In Singapore, we have seven projects underway with local unique designs are created with the resident first and
major developers. We have been in the Singapore market for foremost. We believe these projects effectively integrate
over four years now and are establishing a reputation for Sekisui House’s know-how in sustainable living environments.
ourselves through the development of complexes and office We will continue to use the technologies and experience
buildings. we have built up in Japan to bring the people of Singapore
Since we began business in Singapore in 2010, we have Sekisui House’s unique homes, working with local partners to
continuously shared opinions with our partners and striven to provide residents with comfortable homes that show an
incorporate the know-how we have built up in creating homes understanding of this island nation’s housing culture.
centered on customer needs.
In condominium development,
we have incorporated a satoyama
design approach of community
development to the Hillsta project in
the Choa Chu Kang district of
Singapore. (Satoyama refers to a
natural environment that has been
slightly modified by humans.) For the
eCO project in Singapore’s Bedok
district, we have model rooms that
show visitors that Sekisui House’s RiverTrees Residences at Fernvale Close (artist’s rendering)

Evaluation

Contributing to better living environments through technologies and know-how cultivated in Japan

We contribute to improving living environments by utilizing the housing and detached housing construction, while in the U.S. we work as a
technologies and know-how we have built up in Japan. This is a crucial community developer in cooperation with our partners. These efforts
element in business strategies in line with the particular conditions of have been going extremely well: we have received high praise and
the countries and regions in which we do business. For example, in numerous industry awards, and we turned a profit in these businesses
Australia, we carry out condominium and residential land development as of our second year.

Cinco Ranch (on the outskirts of Houston, Texas, U.S.) The Waterfront (on the outskirts of Sydney, Australia)

Growth of Sekisui House’s overseas business

Net sales Ordinary income
(billion yen) (billion yen)
220 25 23.3
Australia U.S. China
200
180 172 20
160
140 15 12.8
120 110 9.7 10.0
10
100 85.3 79.8 5.1
80 5
60 54.8
40 24.2 0
20
0 5 3.1
2011 2012 2013 2014 2015 2016 (FY) 2011 2012 2013 2014 2015 2016 (FY)
Note: Since the Sekisui House subsidiary in Singapore is accounted (plan) (plan) (plan) (plan)
for under the equity method, only income is reflected.

Sekisui House Sustainability Report 2015 52