NSK REPORT 2024
Year ended March 31, 2024
Integrated Report
Sustainability Initiatives
05
Sustainability Management ………………………………………………38
Safety Management ……………………………………………………………39
Quality Management……………………………………………………………40
Supply Chain Management ………………………………………………41
Environmental Management ………………………………………………42
Compliance …………………………………………………………………………50
Respect for Human Rights …………………………………………………51
Information Security Management ……………………………………52
Business Continuity Management
-Initiatives to Strengthen Crisis Management
and Business Continuity Capabilities- …………………………………………53
Data Section
07
Financial Highlights ……………………………………………………………70
Non-Financial Highlights ……………………………………………………73
Consolidated Financial Statements ……………………………………76
Major NSK Group Companies ………………………………………………80
Basic Knowledge of NSK Products ………………………………………82
Glossary ………………………………………………………………………………84
IR Activities …………………………………………………………………………86
Share Information ………………………………………………………………87
Third-Party Assurances ………………………………………………………87
Strengthening Internal Capital
04
Intellectual Capital -Strengthening Technological Capabilities- …30
Manufacturing Capital …………………………………………………………32
Human Capital ……………………………………………………………………34
Mid- to Long-Term Growth Strategies and
Resource Allocation
03
Review of Past Mid-Term Management Plans and
the Positioning of MTP2026 ………………………………………………20
Policy for the Second Half of the Mid-Term Management Plan
Targeting Change & Go Beyond ……………………………………………21
Business Strategy①
Strategy and Progress of the Industrial Machinery Business …22
Business Strategy②
Strategy and Progress of the Automotive Business ……………24
Message from the CFO …………………………………………………………26
Corporate Governance
06
Outside Director Dialogue …………………………………………………54
Corporate Governance Systems …………………………………………60
Composition and Initiatives for
Enhancement of Board of Directors …………………………………62
Internal Controls, Cross-Shareholdings,
Directors/Officers’ Compensation ……………………………………64
Risk Management ………………………………………………………………66
Management ………………………………………………………………………68
Contents
Introduction
01
NSK’s Unwavering Spirit ………………………………………………………02
Our History …………………………………………………………………………03
NSK’s Business Portfolio ………………………………………………………04
NSK Supporting Society ………………………………………………………05
02
NSK’s Value Co-Creation Story
NSK’s Business Model for Collaborative Value Creation ………12
Creating Collaborative Value with Stakeholders …………………13
Deepening of the Value Chain ……………………………………………14
Materiality ……………………………………………………………………………16
Special Feature: Taking on the Challenge to Change & Go Beyond
―Bearings & Beyond Initiatives― ………………………………………………18
CEO Message
06
…
NSK is changing and going beyond to
create new motion and new value
NSK has showcased its
commitment to create
new value by taking up
the challenge to Change
& Go Beyond in its NSK
Report 2024.
The cover of NSK Report 2024 paints a picture of the Company’s
founding bearings business and its mission to aspire to a higher
level espoused by the Bearings & Beyond concept. Drawing on
this visual representation of its overarching purpose, NSK is
dedicated to integrating its tribology and digital technologies and
to contributing to a carbon-neutral and recycling-oriented society.
Thoughts on the
cover of this report
This Report provides a concise summary of all information deemed important in the Group’s efforts
to create collaborative value. For more information about the NSK Group’s products and business,
please refer to the Company’s website.
Details
NSK
Report
2024
Sustainability
Information
Sustainability Website ▶
Financial
Information
Information for Investors ▶
Editorial Policy
Contact
The NSK Report 2024 is designed to provide readers with a deeper
understanding of how the Company works with stakeholders to create
collaborative value that meets the expectations of the world over the mid
to long term based on its Motion & Control™ concept, and of the processes
that will achieve both social contribution and
corporate development.
In putting together this Report, we referred to
the International Integrated Reporting Framework
recommended by the IFRS Foundation and the
Guidance for Collaborative Value Creation formulated
by Japan’s Ministry of Economy, Trade, and Industry.
Corporate Communications Department, NSK Ltd.
Nissei Bldg., 1-6-3 Osaki, Shinagawa-ku, Tokyo 141-8560, Japan
E-MAIL ir@nsk.com
Disclosure Framework
Period of Coverage
FY2023 (April 1, 2023, to March 31, 2024)
Notes:
1. Certain activities before FY2022 and after FY2024 are included.
2. For the purposes of this report, actual data includes the steering business, which is a discontinued
operation (excluding data for certain automotive operations).
Organizations Covered
NSK Ltd. and NSK Group companies
(NSK Group companies include consolidated subsidiaries, non-consolidated subsidiaries, and
affiliated companies.)
Disclaimer
Statements made in this integrated report with respect to plans, strategies, and future performance that
are not historical facts are forward-looking statements. NSK cautions that several factors could cause actual
results to differ materially from those discussed in forward-looking statements. This document is an English
translation of NSK Report 2024 dated September 29, 2024, that was originally prepared in the Japanese
language, and it is provided for convenience purposes only. Therefore, this document does not include any
event that has occurred, or has been found to have occurred, on or after September 29, 2024. NSK makes no
representation or warranty that this document is a complete or accurate translation of the original Japanese
text, and it is not intended to be relied upon. If there is a discrepancy between the Japanese and English
versions, the Japanese version shall prevail. This document is not intended and should not be construed as
an inducement to purchase or sell stock in NSK.
Glossary Legend
Explanation of terms on the same page.
Glossary
Explanation of terms outlined in the Glossary on pages 84‒85.
NSK REPORT
2024
1
Compliance
Environment
Quality
Safety
NSK contributes to a safer, smoother society
and helps protect the global environment
through its innovative technology
integrating Motion & Control™.
As a truly international enterprise,
we are working across national boundaries to
improve relationships between people
throughout the world.
Corporate Philosophy
ーThe Purpose of NSK’s Existenceー
We bring motion to life,
to enrich lifestyles,
and to build a brighter future.
Dedicated to uncovering society’s needs,
we set ideas in motion
to deliver solutions beyond imagination.
We’re NSK.
And, we’re setting the future in motion.
SETTING THE FUTURE IN MOTION
NSK Vision 2026
ーOur Vision for 2026ー
Core Values
ーOur Highest Priority Valuesー
ーOur Enduring Focusー
Action Guidelines
Beyond Limits, Beyond Today
Aspiring to be
a company that is needed,
trusted, and relied upon
by society
Introduction
01
NSK’s Unwavering Spirit
Despite the rapidly shifting business environment
in which NSK operates today, we will help build a
sustainable society through value co-creation with
our stakeholders as we aspire to be a company that
is needed, trusted, and relied upon by society. NSK is
committed to achieving further growth by acting in
unison across the globe.
NSK REPORT
2024
2
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Industrial Machinery Business
Automotive Business
1916
1950
1980
1990
2000
2010
2020
Foundation
1910
～
1950 ～
1980 ～
1990 ～
2000 ～
2010 ～
2020 ～
Trend in NSK’s
sales since its
founding
Reached
¥10billion
FY1960
Reached
¥100billion
FY1974
Reached
¥500billion
FY2000
1991
● Monocarrier™ multi-functional
actuator
1996
● High-load drive ball screws for
injection molding machines
1999
● Large bearings for wind
turbine gearboxes
1998
● Acquisition of FLT Iskra S.A.
(Poland)
2007
● Variable steering angle
mechanism for column type
electric power steering (EPS)
systems
2003
● Transfer of seatbelt business
2013
● Lubricant grease derived from
100% food-grade ingredients
2017
● Commercialization of
LIGHBOT™ guide robot
2012
● Passenger train car axle sensor
bearings
2015
● Sale of exposure equipment
business
1984
● Multipurpose lithography for
semiconductor manufacturing
● Megatorque Motor™ direct
drive motor for factory
automation
2008
● Ultra-fine manipulation
system for medical and
biotechnology fields
2007
● Human assistant robots
utilizing sensing technology
● T-IDG toroidal CVT units for
aircraft
● High-performance flywheel
bearings for satellite altitude
control for the greenhouse
gases observing satellite
“IBUKI” (GOSAT)
● Establishment of
sales locations and
production sites
in Europe and the
Americas
● Establishment of
mother plant system
● Establishment of technical
centers in Europe and the
Americas
1964
● Journal bearings
for the Shinkansen
1959
● Precision ball
screws for machine
tools
1966
● Slewing bearings
for turning satellite
communication
dishes
1973 Oil crisis
1985 Plaza Accord
1990 Collapse of
economic
bubble
2011 Great East Japan
Earthquake
2020 Spread of COVID-19
2008 The global
financial crisis
1997 Asian currency crisis
2023
● Highly accurate bearing life
prediction method applying
micro ultrasonic testing
method
2024
● Launch of gas turbine generator
bearing for eVTOLs (large drones)
● Acquisition of Brüel & Kjær Vibro
condition monitoring systems
business
2021
● Biomass plastic cage
2021
● Gen 3 high-speed rotating ball
bearings for EV motors
2020
● Low friction hub unit bearings for EVs
Business Portfolio
(Composition of Sales)
■ Automotive
Business
■ Industrial Machinery
Business
FY2007
6
4
：
FY2017
7
3
：
FY2026
5
5
：
Post
2026
4
6
：
● Development of products and services ● Expansion of locations, M&A, collaboration, etc.
1916
● First company
to mass produce
bearings in
Japan
● Establishment of
China Technology
Center
2011
● Low-friction ball screws for
cooperative regenerative
braking systems
2017
● Wireless charging
in-wheel motor
2019
● Tapered roller
bearings for
lean lubrication
conditions in EVs
▶ PP.18‒19 Special Feature: Taking on the
Challenge to Change & Go Beyond
▶ PP.46‒47 Environmental Management
－Efforts to Maximize the Environmental
Contribution of Our Products－
● Establishment of
sales locations
and production
sites in China and
Southeast Asia
Jakarta Plant
PS/PN Series Megatorgue
Motors of recent years
▶ PP.22‒23 Business Strategy 1:
Strategy and Progress of the
Industrial Machinery Business
▶ PP.24‒25 Business Strategy 2:
Strategy and Progress of the
Automotive Business
1968
● Two-point seat belts
1963
● Establishment of
NSK Torrington Co., Ltd.
(production of needle bearings)
1964
● Establishment of NSK-Warner
K.K. (production of automatic
transmission components)
1958
● Ball screw type manual
steering systems
▶ P.25 Business Strategy 2: Strategy and
Progress of the Automotive Business
Reorganizing the steering business into a JV
Results
Our Vision
1986
● Electric power steering
(EPS) systems for battery-
powered forklifts
1988
● Pinion EPS system
1987
● 3rd generation hub unit bearings
1999
● Commercialization
of toroidal
continuously
variable
transmission
(CVT)
Introduction
01
Our History
For more than 100 years, NSK has grown by challenging itself to develop innovative technologies and contributing to the reduction of energy loss and by supporting the development of
industries globally through collaboration and the expansion of its overseas business.
1931
● Double-row
cylindrical roller
bearings for rolling
mills
2023
● Expansion of lineup of electrical
erosion resistant bearings for eAxles
● Change in status of NSK Steering &
Control, Inc., which controls the steering
business, to an equity-method affiliate
Events that had a
signifi cant impact on the
business environment
Reached
¥1trillion
FY2017
NSK REPORT
2024
3
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Railways
Home
Appliances:
Washing
machines
Satellites
Wind
Turbines
Automobiles
Drones
Medical
Equipment
A total of 100 bearings
are used by the average
household!
Some 100 to
150 bearings
are used in
automobiles!
Introduction
01
NSK Supporting Society
NSK is creating value to support society everywhere
in the world. A vast array of NSK products centered on
bearings continue to excel in every industry, ranging
from home appliances, automobiles, communication
base stations, and other items that support people’s daily
lives to machine tools, robotics, and wind turbines. NSK
products will continue to support a society that is safe,
secure, comfortable, and environmentally friendly.
Data
Centers
Contributing to
energy savings and
improved reliability
of 5G base stations
and data centers
Bearings
Contributing to
stable flight and
greater reliability
Bearings
Contributing to a
comfortable life that
is friendly to people
and the environment
Bearings
Contributing to improved
safety, comfort, and
environmental performance
Bearings/Ball screws
Contributing to people’s
health and peace of
mind as well as advanced
medical care
Bearings/Ball screws/
MonocarrierTM
Glossary, etc.
Contributing to long-term
stable operations in the
special environment of space
Bearings
Contributing to the
protection of the global
environment through
the stable operation of
wind turbines
Bearings
Machine
Tools
Contributing to higher precision
and productivity in parts
machining
Bearings/Ball screws/Linear guides
Contributing to safe, secure,
comfortable, and environmentally
friendly means of transportation
Bearings
NSK REPORT
2024
5
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Japan
34%
The Americas
18%
Europe
14%
China
20%
Other Asia
14%
Other Asia
14%
Other
4%
Industrial
Machinery
Bearings
38%
Precision
Machinery
and Parts
Precision
Machinery
and Parts
6%
Automotive
Business
52%
Breakdown of Sales of Industrial Machinery Bearings
(Sales: ¥296.5 billion)
Breakdown of Sales of Precision Components
(Sales: ¥48.3 billion)
Automotive Business
Industrial Machinery Business
Foundation
1916
Bearings
Market
Share
Share
in JapanNo.1
Global
share No.3
Bearing sales (including industrial machinery and automotive use)
Number of Employees
（
）
As of the end of
March 2024
25,632
(consolidated)
Consolidated
Sales
*3
¥
billion
788.9
（FY2023）
32%
Hub Unit
Bearings
Other Automotive
Bearings
Automatic Transmission
Components
30%
21%
Glossary
Needle Roller
Bearings
17%
Glossary
Breakdown of Sales by Product
(Sales: ¥408.8 billion)
General Machinery
(OEM)*1
E&E*2
34%
31%
35%
Aftermarket
and CMS
Glossary
Machine Tools and Injection
Molding Machines
Semiconductor and FDP
Production Equipment
Other 35%
34%
31%
Basic Information
Japan
Other
Asia
The
Americas
Europe
13%
China16%
42%
9%
20%
▶ PP.24‒25 Business Strategy 2: Strategy and Progress of the Automotive Business
17%
23%
18%
18%
24%
Japan
Other Asia
The Americas
China
Europe
▶ PP.22‒23 Business Strategy 1: Strategy and Progress of
the Industrial Machinery Business
Introduction
01
NSK’s Business Portfolio
This segment provides various types of bearings,
automotive transmission products, ball screws
for electric brakes, and other automotive
components that are used in automobiles.
Amid the accelerating innovation in
automobile technologies, such as power source
diversification and automotive driving, the
Company is advancing the development of new
technologies and products, creating new value,
and working on valuable proposals.
This business segment provides a variety of
industrial machinery bearing types, ranging
in size from miniature bearings to extra-large
bearings, to meet a wide range of demands in
all industries. Meanwhile, precision machinery
and parts comprise such linear motion products
as ball screws and linear guides as well as
mechatronics parts, including Megatorque
Motor™, which play a key role in machine tools
and semiconductor production equipment that
requires precision positioning.
*1 Machine tools, industrial robots, wind turbines, train cars,
mining and construction machinery, pumps and compressors,
steelmaking facilities, etc.
*2 Home appliances, information, PCs, in-vehicle motors, etc.
*3 Data excludes the steering business.
Breakdown of Sales by Region
Breakdown of Sales by Region
NSK REPORT
2024
4
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK is changing and going beyond to
create new motion and new value
NSK’s Value Co-Creation Story
02
CEO Message
Akitoshi Ichii
President and CEO
Supporting industrial growth through trusted
solutions and a robust technology platform
As the first company in Japan to successfully develop and manufacture bearings in 1916,
NSK has sought to reduce friction and improve the rotational motion and reliability of
machines for more than a century while refining its technologies that support motion
and the movement of machinery and equipment. Guided by its Corporate Philosophy*,
NSK is committed to the development of advanced products and services, as well as
industrial society worldwide through its business activities as a leading bearing, precision
machinery, and parts company. ▶ P.2 NSK’s Unwavering Spirit
Just as semiconductors underpin the evolution of society and all kinds of products as the
staple of industry, bearings power, among other things, automobiles, rail transportation,
and home appliances as a staple component of machinery, and are used in a broad array of
manufacturing equipment that manufacture various products while supporting advances
in technology. Many end-users might not be aware of the importance that bearings
play in supporting the functions of the machinery they purchase or the companies that
manufacture them. Against this backdrop, NSK’s products are used across a wide range
of industries and end-product domains, from automobiles through machine tools to
robots, wind power generation systems, home appliances, and medical equipment, and
play a major role in supporting the movement and rotational motion of machines, which
is essential to equipment and machinery stability as well as production, operating, and
energy efficiency. Coupled with the deep trust of its customers, underpinned by the
NSK REPORT
2024
6
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
backdrop, we will engage in activities that are designed to stabilize our business
and improve profitability by implementing product and customer portfolio reforms.
▶ PP.24‒25 Business Strategy 2: Strategy and Progress of the Automotive Business
* NSK contributes to a safer, smoother society and helps protect the global environment through its innovative
technology integrating Motion & Control™. As a truly international enterprise, we are working across national
boundaries to improve relationships between people throughout the world.
NSK currently engages in business across the two reportable segments of Industrial
Machinery and Automotive. To ensure its ongoing growth, NSK must embrace change
while also transforming itself amid a harsh and volatile business environment. With
this in mind, I believe that the Company must increase the sales ratio of the Industrial
Machinery Business through FY2030, as the market changes dramatically, and
reorganize its portfolio, including the business activities of the Industrial Machinery and
Automotive businesses.
With the ongoing global shift to electric vehicles* by the automotive industry, NSK
expects roughly half of the world’s automobile production to be electric vehicles by
FY2026. While certain disparities might arise due to regional characteristics and consumer
preferences, we anticipate this general trend toward electrification will remain unchanged
going forward. At the same time, Chinese manufacturers are emerging on the strength
of their battery electric vehicles (BEVs) in global markets, including the ASEAN region,
historically a stronghold for Japanese cars. The fact that China’s vehicle exports exceeded
those of Japan in 2023 is indicative of upheaval in the competitive environment of the
automotive industry. Moreover, the pace of technological development, as exemplified
by China’s emerging EV manufacturers, is increasing, with shorter lead times between
development and mass production. To meet the requirements of customers, who are
developing and manufacturing BEVs at an unprecedented pace, NSK is working to raise
the level of its development capabilities in each region and to modify the way it conducts
its work. Meanwhile, in addition to focusing its resources on the electrification of vehicles,
NSK will promote a holistic approach that includes conventional internal combustion
engines (ICEs). In light of recent concerns surrounding fuel costs and the environmental
burden imposed by the manufacturing process, we will closely monitor changes in
the industry while responding to trends in new demand, including the growing use of
hydrogen-fueled vehicles.
NSK’s Automotive Business has historically enjoyed growth and secured earnings
on the back of increases in automobile production volumes and contributions
through technologies that improve fuel efficiency. Looking ahead, however, I
am convinced that major shifts in automobile technologies, represented, for
example, by the electrification of cars, will provide NSK with opportunities to
differentiate its technologies and put forward product proposals. Against this
* Hybrid vehicles (HEVs), including plug-in hybrid vehicles (PHEVs), and battery electric vehicles (BEVs)
The Industrial Machinery Business’s operating environment is characterized by a
downturn in the workforce and rising wages owing to the decline and aging of populations
in developed countries. This, in turn, is driving the trend toward automation and increased
interest in artificial intelligence. Taking the aforementioned into consideration, precision
products and precision bearings are expected to experience substantial growth in the
semiconductor manufacturing equipment and robotics markets as well as the machine
tools field, where further sophistication is required. At the same time, and in light of
progress in industrial infrastructure technological innovation in such areas as renewable
energy and energy conservation, business opportunities are projected to increase with the
incidence of new demand and technology development.
In line with these expectations for Industrial Machinery Business growth over the long
term, NSK will expand its business with a focus on the precision ball screw and precision
bearing fields, where NSK excels, as well as technologies that enhance durability and
lower friction. In specific terms, we will work to lift the ratio of Industrial Machinery
Business sales of our total sales from the 30% in FY2017 to 50% under the Mid-Term
Management Plan 2026 (MTP2026), and then to 60% by FY2030.
The shift toward automation and increasingly sophisticated robotics provides NSK
with the opportunity to expand its business by increasing sales of precision bearings
and precision machinery products, which boast relatively high profitability. At the
same time, we will strengthen our sales structure in the highly profitable and stable
aftermarket
Glossary while expanding business in regions such as the Americas, Eastern
Europe, and India. Complementing these initiatives, we will create high-value-added
products and businesses, such as unit products, including actuators
Glossary that employ
ball screws, as well as condition monitoring, diagnostics, and other services. We will
also consider reviewing the allocation of human and other managerial resources in line
with these endeavors. Moving forward, NSK will focus on highly profitable products and
services, work to build a stable earnings platform during the period of MTP2026, and
achieve a double-digit operating income margin in response to changes in society all
while maintaining our competitive advantage.
▶ P.20 Review of Past Mid-Term Management Plans and the Positioning of MTP2026
▶ PP.22‒23 Business Strategy 1: Strategy and Progress of the Industrial Machinery Business
Company’s longstanding technologies and experience, this track record will continue to
serve as an inherent strength and lead NSK into the next 100 years.
Adapting our business portfolio in a changing
environment
Achieving growth with profitability through
Bearings & Beyond
Efforts to transform the business portfolio are supported by the Bearings & Beyond
concept, which itself is a theme for growth with profitability set under MTP2026.
Glossary
NSK REPORT
2024
7
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
“Bearings” refers to further increasing the added value of existing NSK products
by pursuing the core technologies the Company has cultivated to date.
“Beyond” refers to broadening the scope of business through core technologies,
developing new products, and expanding into selling services through condition
monitoring and product life-cycle management (PLM
Glossary ) solutions.
▶ P.20 Review of Past Mid-Term Management Plans and the Positioning of MTP2026
While NSK has secured the top market share in such fields as precision bearings, ball
screws, bearings for automobile use, and ball bearings, I believe that the quality and
reliability of these products are of the utmost importance. In this regard, it is not enough
to just meet the expectations of customers. Going forward, it is vital that we provide
value that exceeds expectations and that we contribute to resolving a host of social and
environmental issues. In the future, we will look beyond the business model that begins
and ends with the sale of bearings. We will work to create new value by expanding into
providing services based on a PLM model. This includes providing customers with in-
depth proposals that extend from the monitoring of bearing conditions to the diagnosis
of remaining service life. We will also contribute to the development of a circular society
through the replacement and repair of bearings at the appropriate time. For example,
we engage in line side repair and maintenance work at a steel mill in India, and check
and sort bearings for repair into those that can be used and those that cannot in China.
▶ PP.22‒23 Business Strategy 1: Strategy and Progress of the Industrial Machinery Business
In addition, I believe that M&As and collaboration are critical to achieving the Bearings
& Beyond concept. As such, we will consider these options not only from the perspective
of expanding existing businesses but also with a focus on generating synergies with a
view to enhancing our technological capabilities and the added value of products. We
will especially look to expand unit products, including electric actuators, and services.
Recognizing that the development of technologies and human resources are vital
to increasing the value added in these areas, we will take full advantage of external
expertise. ▶ PP.34‒37 Human Capital
NSK completed the acquisition of the global condition monitoring system (CMS)
business known as Brüel & Kjær Vibro (B&K Vibro) from Spectris Plc. in 2021. With a
proven track record as a business that has monitored tens of thousands of wind turbines,
bringing this global vibration diagnostic specialist into its fold helps NSK augment its
know-how and systems for device and data collection. By leveraging this knowledge
and talent pool as a Group, we will accelerate the integration of diagnostic technologies
based on our tribology platform while training engineers who can diagnose the
condition of equipment from vibration data. Making the most of our inherent marketing
channel and customer base strengths, steps are already under way to actively provide
customers with diagnostic equipment and service proposals.
Under MTP2026, NSK has set a new product sales expansion target of ￥50 billion. We
expect to achieve this target through our efforts in advancing human-robot coordination,
expansion into the medical and biotechnology fields, and contributions from automation
and electrification initiatives. We are well on the way to achieving this target with current
progress at roughly 80%. Efforts to electrify braking systems are also well advanced amid
the growing acceptance of EVs and calls for improved safety. Against this backdrop,
NSK’s ball screws used in electro-hydraulic brake systems, where forecast demand is
high, are held in high esteem by the market. With a top share, the Company is on track to
receive orders totaling roughly ￥25 billion. As previously mentioned,
we will also expand sales in the CMS business to the ￥10 billion level under MTP2026.
While sales in the new robotics and biotechnology business fields have yet to reach
￥1 billion, we are making steady progress with new product proposals. In fact,
customers are beginning to try several new products, including motorized assistance
robots, precision control manipulators, actuators for industrial machinery use, and
edible oil deterioration control filters. Furthermore, we are sowing new product
seeds through new technology proposals and collaboration with customers. Despite
the initial limited scale, I strongly believe that meeting the needs of society with
NSK’s technology is important to raising the competitiveness of existing products
and ensuring the continuous development of new products and services. Moreover, I
recognize that dialogue with the market and the speed with which we take action are
of equal importance. With this in mind, we will also work to develop human resources
through co-creation aimed at generating a variety of new products and services.
▶ PP.18‒19 Special Feature: Taking on the Challenge to Change & Go Beyond
―Bearings & Beyond Initiatives―
Improve profitability and capital efficiency
NSK’s products are indispensable to the machinery industry. Conversely, its products are
susceptible to shifts in capital investment and business sentiment. The challenge before
us is therefore to build a structure that is resilient to demand trends and the business
environment. Working toward business stability and growth under MTP2026, we will
put in place a structure that is capable of achieving capital efficiency and target an
average ROE of 8% or more.
To gain a favorable assessment from the stock market, it is important that we increase
profitability and raise ROE above the cost of capital. To this end, we will work to achieve
a return on invested capital (ROIC) in excess of the weighted average cost of capital
(WACC) in our business operations. As a business, we will put in place a structure that is
resilient to fluctuations in the economy, enhance our ability to withstand any demand
NSK’s Value Co-Creation Story
02
CEO Message
NSK REPORT
2024
8
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
downside, and generate sufficient profits based on an operating income margin in excess
of 10% when demand is stable. Positioned as stepping stones in the effort to build this
structure, NSK has set ROE and ROIC targets of 8% and 6%, respectively, in MTP2026.
Turning to the Company’s capital policy, we will endeavor to lift our capital efficiency
by improving the efficiency of existing facilities. At the same time, we will provide stable
shareholder returns and flexibly implement share buybacks. Rather than rely solely on
the principle of self-sufficiency, we will consider opportunities for external collaboration,
including M&As, with respect to our manufacturing and business operations.
As we push forward Bearings & Beyond initiatives under MTP2026, we will focus
on increasing profitability and capital efficiency. In addition to the stepping-stone
targets for net sales, operating income, and ROE of ￥900 billion, ￥75 billion, and 8%,
respectively, we will set a future ROE target of 10% and work to improve the PBR.
▶ P.21 Policy for the Second Half of the Mid-Term Management Plan Targeting Change & Go Beyond
▶ PP.26‒29 Message from the CFO
Looking 10 years and further ahead
Under MTP2026, NSK is focusing on putting in place a platform that is capable of securing
sustainable growth. Ultimately, our goal is to reinforce our position as an integral member
of society and continue to foster trust to remain a preferred company of choice not only
over the next 10 years but also beyond. In strengthening our managerial resources to
this end, we are actively employing digital technologies to become a company that can
continue to transform its operating processes and business model.
In addition to the Sangen Principle, or “the Three Reals” (gemba: actual places,
gembutsu: actual things, and genjitsu: actual situations), that has historically catered to
the physical needs of sight, touch, and feel, I believe that the use of digital technologies
will help break down preconceived perceptions. By employing digital technologies
and organizing vast amounts of data, the potential exists to uncover phenomena that
had previously proven difficult to grasp. Moreover, new ideas can emerge through the
scientific verification of these phenomena. NSK’s goal is to ensure that the use of digital
technologies becomes a matter of course in engineering and production.
Strengthening managerial resources that employ digital technologies
Bearings & Beyond initiatives,
targeting an ROE of 10%
NSK REPORT
2024
9
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK is strengthening its tribology-based weight reduction, torque reduction, and
other core technologies through combination with digital technologies. We have, for
example, succeeded in improving sealing performance and reducing frictional resistance to
unprecedented levels utilizing digital simulations. Furthermore, we have commenced trial
operations with the aim of more proficiently utilizing past facility, quality issue, design error,
and related data. Looking beyond simple collation, we are working to visualize the value
of data in a bid to trigger further improvements. Moving forward, I am convinced that the
promotion of various Change & Go Beyond initiatives at the front line and efforts to develop
large numbers of supporting DX professionals will further enhance NSK’s competitive edge.
▶ PP.30‒31 Intellectual Capital ―Strengthening Technological Capabilities―
look at the Company’s fundamental technology and manufacturing engineering
activities and provide their invaluable feedback, we will be better positioned to
enhance our technological and manufacturing capabilities. Our people will also grow
through communication with customers. I am convinced that this growth through
communication will help drive the Company forward while stimulating spontaneous
thought and the incidence of new products and ideas. In addition to existing customers,
we will expand our communication and build connections with a variety of medical,
biotechnology, food, and other fields. We will enhance our value and potential and
through communication pick up on hints that will stimulate further co-creation.
NSK’s products and technologies are expected to help reduce friction and contribute
to the infrastructure and technologies that support a renewable energy society. In
addition to environmentally friendly products and services that contribute to reductions
in energy consumption, we recognize that clean technologies play a role in resolving
energy- and resource-related issues, including wind-power and hydrogen-related
businesses, as do technologies that facilitate the underground storage of CO2 recovered
from the atmosphere̶another growth field. I suspect that NSK’s products and
technologies will increasingly excel in this field in the future.
In addition to its products and services, energy is being directed toward the CO2
emissions produced by NSK and all Group company business activities. Complementing
energy-saving activities at plants, the Group has undertaken steps to progressively
switch to the use of renewable energy. As a result, NSK reduced CO2 emissions by
52% compared with FY2017 in FY2023, achieving its FY2026 target of 50% in advance.
Working to achieve carbon neutrality by FY2035, we will further promote efforts to
reduce Scope 3 (upstream) CO2 emissions throughout the supply chain in cooperation
with suppliers in a bid to help achieve the global society goal of net zero CO2 emissions
by 2050. ▶ PP.42‒49 Environmental Management
Since assuming the position of president, I have consistently conveyed the need to
embrace the Change & Go Beyond concept. In doing so, my hope is that the Company
will continue to challenge new frontiers and advance toward high future-oriented goals.
This entails respecting diversity, listening carefully, and addressing concerns unblinded
by precedent or prejudice. In this manner, I believe that NSK will achieve the industry’s
leading quality and reliability in its pursuit of its Four Core Values of Safety, Quality,
Environment, and Compliance. This, in turn, will strengthen our position as a company
that is essential to society. To change, we need only take a step in any direction and
to then jump to go beyond. Should we fail, however, to secure the necessary firm
foundation, a single step forward will inevitably lead to a stumble and fall. If we
ask ourselves what will serve as this foothold and foundation, we need only look to
the quality and trust that NSK has nurtured over many years and the technologies
that underpin our products and services. Accordingly, we must bolster our existing
businesses that are supported by our manufacturing and tribology technologies and
continue to maintain an industry-leading presence in each domain, thereby securing
the necessary foothold to take the next step. Leveraging these endeavors as inherent
strengths, we will pursue a process of self-reform in tune with society as a company that
continues to create value, and then expand in a variety of directions.
Thanks to the development and widespread use of ICT, we now live in an age in which
the information we require is readily available. Having said this, I fear that the direct and
simple search for information today has narrowed the options pursued and reduced the
number of chance encounters. When casually strolling through the city, one might be
surprised by the sights and sounds that had previously gone unnoticed. Opportunities
to bump into someone unexpected could also arise. These chance encounters might
lead to new discoveries and insights that provide the stimulus to Change & Go Beyond.
Through business visits and dialogue with employees, I have responded to more than
1,000 questions each year. I believe it is important to not only communicate and share
my thoughts and ideas but also listen carefully to the dreams, aspirations, and concerns
Contributing to a carbon-neutral and circular society
New value to emerge from the Change & Go Beyond concept
NSK’s strengths lie in the depth of the fundamental research and development of
its product technologies that underpin the Company’s manufacturing activities.
Recognized for our high technological capabilities, our earnest tribology materials
technology endeavors have helped build relationships of trust with customers.
▶ PP.30‒31 Intellectual Capital ―Strengthening Technological Capabilities―
Ensuring that our customers tour the Group’s laboratories and plants is extremely
important in nurturing these relationships of trust. As customers gain a first-hand
New value to emerge from points of customer contact
NSK’s Value Co-Creation Story
02
CEO Message
NSK REPORT
2024
10
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
of the front line. Rather than remain in one’s own comfortable shell, making the effort to
go outside is critical to gaining new insights and understanding.
While I am confident that advances in technology will continue to lower language
barriers going forward, I do believe that new encounters and the ability to communicate
on the world stage will become increasingly important. This is where respect for
diversity comes into play. In the world of sports, players who excel globally are
universally recognized irrespective of their country or race. Today, we too live in a
business world where the same applies. To earn this recognition, it is important to
venture outside one’s comfort zone and to gain new knowledge unbound by tradition
and convention. Pride must not stand in the way of our learning from emerging
manufacturers. We must absorb what we can from robust competitors, especially in the
areas of speed and cost control. Calling on local markets, it is imperative that we confirm
with our own eyes, while experiencing first hand and incorporating all positive aspects.
This I believe as an absolute prerequisite to survive as a global company. Without
the ability to compete on the world stage, it will become difficult to remain a viable
going concern given the increasingly harsh competitive environment that lies ahead.
Maintaining a global perspective, I would like us to acknowledge and absorb a broad
range of knowledge and ideas. I would also hope that we can continue to communicate
our concept of Change & Go Beyond based on an understanding of each individual’s
background in order to become a company that is distinguished as a diverse and open-
minded organization. ▶ PP.34‒37 Human Capital
Against the backdrop of a dramatically changing business environment, NSK’s goal is
to reinforce its position as an integral member of society, garner trust, and remain the
preferred company of choice by continuously providing new value based on the concept
of Change & Go Beyond. Moving forward, I humbly request the continued support of all
our stakeholders.
To achieve the industry’s leading
quality and trust, we will reinforce
our position as an integral member of
society, and by garnering trust remain
the preferred company of choice.
NSK REPORT
2024
11
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK’s Business Model for Collaborative Value Creation
The business environment in which NSK operates is experiencing volatile change. Recognizing progress in technological innovation and efforts to reduce the global environmental
burden as opportunities for growth, NSK is committed to both resolving social issues and securing sustainable growth. To this end, and guided by our corporate philosophy, we will
effectively and efficiently utilize our various capital resources and continue to co-create value with stakeholders.
Output
Products/
Services
Impact on
Society/
Environment
Output as a
Burden on the
Environment
Financial
Outcomes from
Provision of
Added Value
R&D/
Equipment
Development
Procurement
Proposal/
Receipt of Orders/
Mass Production
Preparation
Technical
Support/
Aftermarket
Production/
Delivery
Provide Value
through the Value Chain
Driven by the Evolution of
MOTION & CONTROL™
Diverse Capital and Input
Sustainable Growth of NSK
Contribution to Resolve Social Issues
Decarbonization, Electrification, Automation, Renewable Energy, IoT, AI, Digitalization,
Remote, Distributed, Non-Contact, Falling Birth Rates, Aging Populations
Changing Business Environment
● 100 years of accumulated know-how
● Four Core Technologies plus One
● Number of patents 3,999
Intellectual
Capital
Manufacturing
Capital
● Raw materials: Steel, greases, and oils, externally procured components
● Global production sites, manufacturing facilities
Production sites (plants) Japan: 20 Overseas: 47
● Process set-ups, process controls
Financial
Capital
● Total equity ¥678.0 billion
● Interest-bearing debt ¥318.9 billion
● Cash and cash equivalents ¥150.6 billion
Natural
Capital
● Minerals (e.g., iron ore, coal), water, energy
Energy input (per year) 6,394 TJ
Human
Capital
● Highly qualified engineers, skilled workforce, sales personnel, globally minded talent
Technology-related expenses ¥27.4 billion
Ratio of new employees with science backgrounds (annual average over the past five years) 81.1％
Number of employees worldwide (consolidated) 25,632
Seminars on balancing work and caregiving (Japan)
Total 29 times Participants 3,142
● Corporate governance structure (Three Committees
system, global compliance framework)
● Total number of Japan Management College graduates over 21 terms/Global
Management College graduates over 10 terms: 549 (21 countries and regions)
Social/
Relationship
Capital
● Relationships of trust with external parties (customers,
distributors, sales outlets, users, suppliers, local communities)
● R&D structures with external parties
● Globally recognized and trusted NSK brand
Customers
Employees
Suppliers
Local
Communities
Shareholders
and Investors
Future
Generations
(As of March 31, 2024)
Outcomes
Corporate Governance
Promote ESG Management
Materiality
Growth with profitability, Enhancement of managerial resources, ESG management
MTP2026 Three Key Management Tasks
▶ P.13
Corporate Philosophy
ー NSK Vision 2026 ー
Core Values
▶ P.2 NSK’s Unwavering Spirit
NSK’s Value Co-Creation Story
02
NSK REPORT
2024
12
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Creating Collaborative Value with Stakeholders
NSK’s goals are to help resolve social issues while securing sustainable growth by creating collaborative value in response to the expectations and interests of stakeholders.
Stakeholders
Expectations/Interests
Engagement Channels
Outcomes/KPIs*
For Further Collaborative Value Creation
Customers
Machinery manufacturers,
automakers, auto component
manufacturers, distributors,
sales outlets, end-users
● Product and service quality, appropriate pricing,
stability of supply
● Response to technology innovation, solutions to
issues, development of partners, products that
contribute to the environment
● Global support, troubleshooting
● Everyday sales activities
● Technological exchanges
● Exhibitions
● Joint research/joint
development, etc.
No. 3 global market share in bearings
● Creating and proposing new collaborative
value from an end-user perspective
● Developing proposals for supply from optimal
locations that leverage global production sites
Development of environmentally friendly
products: 246 products (cumulative total)
Employees
Advanced technologies,
global human resources
who create high-quality
products and services
● Engaging workplaces
● Use of a diverse workforce, work-life balance,
flexibility with work styles
● Provision of growth opportunities
● Manager/team dialogue
● Objective-based
management, performance
review systems
● Employee engagement survey
● Internal financial results
briefings
● Training, self-improvement
seminars, etc.
Employee diversity ratio (Japan; gender, nationality,
mid-career hires) 29%
● Upgrade and expansion of opportunities for
dialogue with management
● Review of systems to achieve more diverse
work styles
● Promotion of efforts to improve activities based
on the results of employee engagement surveys
● Further upgrade and expansion of educational
and training programs
Ratio of female managers (Japan, non-consolidated) 2.5%
Lost-worktime injury frequency rate (global) 0.28
Support for a work-life balance: Percentage of employees
taking childcare leave Women 100% Men 83.3%
Ratio of Japan/global management college
graduates among executives 65%
Suppliers
Global suppliers of raw
materials and components
● Offering reliable transactions that are proper,
fair, and transparent
● Utilizing transactions that consider society and
the environment
● Joint development (e.g., materials, components, grease),
mutual harmony and benefit through quality improvement
● Collaborating when disasters occur
● Daily procurement
activities
● Procurement Policy
Briefings
● NSK Supplier CSR
Guidelines, etc.
Implementation of human rights due diligence
* Implemented as a part of CSR self-assessments
● Improving the level of CSR management
throughout the supply chain
● Systematic supplier risk assessment and support
● Implementation of supplier CSR self-
assessments once every two years, covering
approximately 90% of suppliers
Local Communities
Mutual harmony and
benefit through business
activities
● Contributing to the creation of employment/
regional development
● Preserving the global environment and the local
environment
● Maintaining an awareness toward safe
operations and the need to reduce noise
● Activities to contribute to local
communities (e.g., donation
drives, cleanup activities)
● Cooperating in community
events (e.g., plant festivals),
welfare programs, etc.
GHG emissions 51.7% decrease
● Increasing the opportunities for exchange to
promote an understanding of safety and
security and raise the degree of trust
● Engaging in ample activities to contribute to
communities
Future Generations
Human resources responsible
for fulfilling NSK’s philosophy
and ensuring the sustainable
growth of society
● Passing down a safe society and an abundant
natural environment
● Generating and providing opportunities for
the growth of the next generation that will be
responsible for the future
● Conveying the enjoyment and importance of monozukuri
● NSK Foundation for the
Advancement of Mechatronics
● NSK Scholarship Foundation
● Science classes for children
● Materials for children (e.g.,
comic books, picture books, and
introduction to technology), etc.
● Strengthening support for the development of
the next generation of human talent from a
long-term standpoint
● Supporting efforts to invigorate the Asian region
by supporting Asian exchange students and the
development of global human resources through
the NSK Scholarship Foundation
Record of support by the NSK Scholarship Foundation
Cumulative total of scholarship recipients 47
Conducting science classes for children
Shareholders and
Investors
Providing financial
capital and monitoring
management
● Maximizing future cash flows
● Realizing shareholder returns in excess of the
cost of capital and an appropriate share price
● Providing information in a proper, fair, and
timely manner, and sincere dialogue
● Promoting proactive CSR and ESG initiatives
● Shareholders’ meetings
● Plant tours for shareholders
● Financial conferences
● Individual IR meetings
● Business briefings, etc.
Annual dividend ￥30 per share (FY2024 forecast
annual dividend ￥34 per share)
● Promoting understanding of management
policies, strategies, and ESG initiatives
● Expanding support of shareholders over the
mid to long term that contributes to the fair
determination of share prices and realizing a
balanced shareholder composition
● Upgrading and expanding engagement with
shareholders and investors
Dividend payout ratio 173.8% (Target 30%‒50%)
DOE 2.4% (-2.5% lower limit)
TSR over the past 10 years 1.2% on an annualized
basis, 12.9% on a cumulative basis
* Data is for the period up to the end of FY2023.
▶ P.39 Safety Management
▶ P.33 Expanding Our Global Business Network
▶ PP.34‒37 Human Capital
▶ P.41 Supply Chain Management
▶ PP.26‒29 Message from the CFO
▶ P.39 Safety Management
▶ PP.42‒49 Environmental Management
NSK’s Value Co-Creation Story
02
NSK REPORT
2024
13
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Deepening of the Value Chain
Utilization of Capital and the Creation of Strengths
Based on our Four Core Technologies plus One, which comprise tribology,
materials, numerical simulation, and mechatronics plus manufacturing
engineering technologies, NSK’s R&D activities in fundamental research, advanced
development, application development, and manufacturing engineering lead to
the further development of existing technologies as well as the creation of new
products, technologies, and businesses.
R&D/
Equipment
Development
Having worked together to ascertain customer and social needs while coordinating
on a global basis, sales and technology divisions put forward technical and pricing
proposals and conduct demonstrations that culminate in the receipt of orders.
At the same time, steps are taken to engage in design activities for the mass
production of products for delivery to customers, where new designs are required,
and preparations for the setup of processes and production equipment at plants.
Proposal/
Receipt of Orders/
Mass Production
Preparation
Intellectual
Capital
Human
Capital
Social/Relationship
Capital
Manufacturing
Capital
Financial
Capital
Natural
Capital
Tasks and Indicators to Deepen the Value Chain
Proprietary equipment development capabilities
Depth of technical human resources
Ability to respond to environmentally
friendly issues based on the accumulation
of technologies
Product development capabilities through
collaboration with customers and external parties as
well as a joint development structure and systems
Product and equipment development capabilities
through stable technology-related investment
Tasks
Supply capabilities from
optimal locations in line
with changes in demand
● Supply capabilities from optimal locations in line with changes in demand
(AM, ICE products, new products)
Proposal capabilities
● Improve technical proposal capabilities based on changing customer and social needs
New value creation
● Propose and provide value and services in new styles, including selling services
Increase the
efficiency of mass
production design
● Utilize core assets (capitalized differentiation technology) aimed at
increasing the efficiency of mass production design and reducing lead times
● Strengthen process management aimed at enhancing design and
product quality
Glossary
● Improve mass production and evaluation efficiency through the use of AI and simulations
Ultra-stable and
increasingly
efficient production
● Strengthen the effectiveness of BCPs in production
● Enhance efforts to build smart factories and next-generation lines
● Shift to production equipment and production processes that enhance energy- and resource-saving
■ Design, cost management, mass production
preparation, and response capabilities based on
quality, cost, delivery, development capabilities,
and service management (QCDDSM)
■ Support for setting up overseas plants and
addressing various issues based on the production
technology and know-how accumulated as mother
plants
Glossary
Global sales strength as well as development
and supply capabilities
Proposal capabilities through collaboration
between global sales personnel and engineers
NSK’s brand distinguished by its high quality
and environmental consciousness
Reductions in mass production costs through the
in-house development of production equipment
and use of specialized production equipment
Engineering capabilities that help realize timely,
reliable, stable production of new projects
■ Cross-regional systems and systems that
cover key customers in each region
■ Utilizing relationships of trust with
customers and the Company’s brand
recognition
■ Financial foundation for funding capital
investments
Strengths
Strengths
■ Environmentally friendly R&D and equipment development based
on the Company’s Four Core Technologies plus One
■ Accumulation of experience and know-how through a global
structure and network for R&D centers, and a patent strategy
that utilizes business strengths
■ Development of technical staff through unique educational
institutions and systematic education programs
■ Extensive network with customers,
suppliers, external research
institutes, and others
■ Financial foundation for funding
R&D and equipment development;
technology and equipment-related
investments in target fields
Key Performance
Indicators
● Rate of lead time
reduction
● New product
net sales
● Productivity
1.5 times
Hand down
and evolve
technologies
● Set and promote development themes in anticipation of
technological change
● Train and retain engineers to hand down and evolve technologies
Pursue
development
efficiency and
quality
● Improve development and evaluation efficiency through
the use of digital twin technologies
● Focus on quality and efficiency at the development stage and improve
manufacturing engineering through the use of digital technology
● Develop environmentally friendly equipment (improve
product yield, the use of recycled materials, energy savings,
and resource conservation)
Strengthen existing
product capabilities and
develop new products
● Develop environmentally friendly products
● Further utilize open innovation
Tasks
Key Performance Indicators
● Number of participants in
NIT
Glossary : 539
● Technology-related
investment for growth
(3%‒4% of sales)
● GHG emissions Scope 1 and 2
● Number of environmentally
friendly products developed
● Number of technical proposals
Deepening of the Value Chain
Each activity in the value chain shown in the collaborative value creation model makes efficient use of the various forms of
NSK’s capital and reinforces business activities by employing the strengths of internal capital, focusing especially on intellectual,
manufacturing, and human capital. Here, we showcase the key capital inputs into each activity, NSK’s strengths, and the tasks
that are being addressed with the aim of further deepening the value chain. ▶ PP.30‒37 Strengthening Internal Capital
▶ PP.30‒31 Intellectual Capital
▶ PP.42‒49 Environmental
Management
▶ PP.32‒33
Manufacturing
Capital
NSK’s Value Co-Creation Story
02
NSK REPORT
2024
14
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Deepening of the Value Chain
Based on the specifications determined by the development
and design departments, activities to procure the
raw materials/components used in products, production facilities,
sub-materials, and the like. The Company realizes high-level
QCD and stable procurement through fair, impartial, transparent,
and socially and environmentally friendly transactions with
its suppliers.
Procurement
Product manufacturing requires coordination among a
wide range of operations, including manufacturing, quality
assurance, manufacturing engineering, equipment management,
production control, plant accounting, and general affairs
work to ensure stringent management over quality, cost, and
delivery (QCD). Both the Industrial Machinery Business and
the Automotive Business have their own plants, maintain
appropriate inventories, and deliver products in a timely manner.
Production/
Delivery
Technical support post sales entails product repair, whereas
aftermarket
Glossary services encompass the maintenance
and repair of customers’ and end-users’ equipment and
machinery and sales expansion centered on MRO
Glossary
through the use of condition monitoring systems (CMOs).
Feedback from customers is reflected in the improvement
of products, the development of new products, and related
activities.
Technical
Support/
Aftermarket
■ Build a sustainable supply chain through such measures as
the prompt identification of contingencies and coordinated
response initiatives based on relationships of trust with
suppliers as well as strengthening endeavors from a
CSR perspective
■ Engage in continuous improvement activities with
suppliers and QCD engagement through joint development
■ Promote flexible procurement through global purchasing
■ Supplier selection skills by experienced buyers
Resilient supply chain
Optimal location procurement through a global
procurement system
Stable
procurement
● Ensure the flexibility of supply, strengthen the
effectiveness of supply chain BCPs
● Optimize the supplier portfolio
Responsible
procurement
● Improve CSR management throughout the supply chain
● Ensure the awareness of reducing environmental impact
throughout the value chain
Tasks
■ Continuous improvement activities aimed at production innovation;
training of engineers at domestic and overseas plants; passing down
of technologies through training; proper stockholding and strict
inventory control by management human resources engaging in
advanced sales, production, and inventory (SPI)
■ Address global demand through 20 and 47 production plants
and facilities in Japan and overseas, respectively
■ Energy- and resource-saving production activities
■ Promote smooth production activities based on relationships
of trust with customers, suppliers, and local communities
High-level SPI management
Excellent equipment development capabilities as well as on-site
and maintenance capabilities well versed in the use of facilities
Production structure and systems that meet global demand in a timely manner
Commitment to core values
Tasks
■ Provide customers with technical proposals and support in the
aftermarket
■ Engage in research into and analysis of product defects and the
status of damage based on feedback from customers and end-
users; propose product improvements and new technologies
■ Respond promptly and meticulously through an extensive
network of distributors and sales outlets; address repair and
maintenance demand for other companies’ products; meet
sudden demand for non-scheduled maintenance; drawing on
each of the aforementioned, also work toward immediate delivery
through the use of distribution channels, including customers
Technical proposal and support capabilities based on
research and analysis data obtained from the Group’s
distributor and sales outlet network
Tasks
Customer
satisfaction
● Employ design and development that leverages
customer and market field data
● Strengthen channel management, cultivate specialists
Key Performance Indicators
● Systematic supplier risk assessment and support
● Implementation of supplier CSR self-assessments once every two
years, covering approximately 90% of suppliers
Key Performance Indicators
● Cumulative total number of participants in the NSK Manufacturing Education and
Training Center
Glossary : 416 (FY2015‒FY2023)
● Lost-time injury frequency rate ● Customer quality awards
Utilization of Capital and the Creation of Strengths
Tasks and Indicators to Deepen the Value Chain
Strengths
Strengths
Strengths
Deepening
monozukuri
● Develop and secure human resources; put in place a
comfortable workplace
● Implement new NSK manufacturing methods that combine Advanced
Production System (APS) improvement activities and digital technologies
Service quality
● Build a supply chain that can respond swiftly to changes in demand
● Accumulate know-how through products and technical
services and improve services through global expansion
Further pursuit
of core values
● Strengthen efforts aimed at reducing environmental impact on distribution
● Introduce renewable energy and promote energy saving in production activities
● Undertake thoroughgoing risk assessments of
equipment and machinery
Glossary
▶ P.41 Supply Chain Management
▶ PP.32‒33 Manufacturing Capital
▶ P.39 Safety Management
▶ P.40 Quality Management
▶ PP.42‒49 Environmental Management
Key Performance Indicators
● Share and sales by industry or product
▶ PP.22‒23 Business Strategy 1: Strategy and
Progress of the Industrial Machinery Business
▶ PP.24‒25 Business Strategy 2: Strategy and
Progress of the Automotive Business
R&D/
Equipment Development
NSK REPORT
2024
15
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Deliberation by the
Operating Committee
Identification of Material Topics
NSK selected subjects that affect or could affect
its sustainable growth and contribution to social
issues from both short-term and mid- to long-
term perspectives. Subjects such as product safety,
helping to build a carbon-neutral society, and local
community development were chosen for material
topic analysis. The selection process primarily
considered the following inputs.
These assessment subjects align with the
commitments to build a “safer, smoother society,”
“protect the global environment,” and “improve
relationships between people” articulated in NSK’s
corporate philosophy, as well as the “safety,”
“quality,” “environment,” and “compliance”
NSK has positioned as core values. They are
also consistent with NSK’s SDGs Declaration,
initiatives under its Mid-Term Management Plan
2026 (MTP2026), issues identified in annual
risk assessments, and activities undertaken with
stakeholders such as customers and suppliers.
The nine identified material
topics were finally determined
by the CEO after deliberation by
the Operating Committee, which
consists of representatives from
the executive divisions. They were
then shared throughout the NSK
Group via the Officers’ Meeting
and reported to the Board of
Directors. Material topics will be
revised continually based on NSK’s
management situation, changes
in social conditions, changes in
stakeholder requests, and other
factors.*
●SDGs ●GRI Standards
●SASB Standards ●ESRS
●Questionnaires from ESG research organizations
● Questionnaires/interviews with institutional
investors
Standards, questionnaires, etc., reviewed:
Selection of Subjects for
Material Topic Assessment
STEP
1
NSK Group’s impact on
the environment and society
Impact of social issues on
the NSK Group
Very
important
Very
important
Important
Important
Materiality
Work across
national boundaries
to improve
relationships between
people throughout
the world
Contribution to
a safer, smoother
society
Help to protect
the global
environment
Highest importance
and material topics
Important but not
material topics
The importance of the assessment subjects was evaluated and mapped from
both positive and negative perspectives in terms of the NSK Group’s impact
on the environment and society (impact materiality) and the impact of
social issues on the NSK Group (financial impact). The nine subjects with the
highest importance were identified as material topics.
STEP
2
STEP
3
NSK’s Value Co-Creation Story
02
Materiality
Materiality
Double Materiality
A method of assessing material topics by evaluating not only the impact of changes
in the external environment such as social issues on business but also the impact of
a company’s activities on external stakeholders, the environment, and society.
Definition
Material Topic Identification Process
* The appropriateness of the setting and
analysis content of the above identification
process has been assessed with insights from
an external consultant.
Based on the concept of double materiality , NSK has identified nine material topics as the key sustainability areas on which it should focus its efforts.
NSK REPORT
2024
16
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Corporate Philosophy
Core Values
Material Topics
MTP2026
Three Key Management Issues
Examples of Initiatives
SDGs (Related Goals) ▶ P.38
Details
Contribution to
a safer, smoother
society
1 Pursue product safety and
reliability
ESG Management
● Promote Total Quality No. 1
initiatives (NPDS
Glossary , NQ1,
and human resources
development)
▶PP.25, 40
2 Create value by integrating
tribology and digital
technologies
Enhancement of
Managerial Resources
Growth with Profitability
● Ultra-stable production
● Bearings & Beyond
▶ PP.18‒19,
30, 32
Help to
protect the global
environment
3 Contribute to
the establishment of
a carbon-neutral society
ESG Management
● Reduce CO2 emissions
● Reduce energy consumption
per unit of sales
▶PP.42‒48
4 Contribute to the establishment
of a sound material-cycle society
(conserve and recycle resources)
ESG Management
● Promote resource conservation
and recycling
● Make smaller, lighter, longer-
lasting products
▶P.49
Work across national
boundaries to
improve relationships
between people
throughout
the world
5 Respect fundamental rights
at work
ESG Management
● Ensure compliance with labor
laws and regulations
● Respect human rights
▶P.51
6 Build a corporate culture of
honesty, fairness, and trust
ESG Management
● Ensure group-wide understanding
of the Corporate Philosophy
● Pursue initiatives to
strengthen compliance
▶P.50
7 Maximize the value of
human capital
Enhancement of
Managerial Resources
ESG Management
● Develop and support diverse
careers; utilize DX
● Improve the working
environment (health and safety)
▶PP.34‒37
8 Implement sustainable
supply chain management
Enhancement of
Managerial Resources
ESG Management
● Improve QCD
● Collaborate on environmental/
human rights initiatives, etc.
▶P.41
9 Promote regional economic
development
Growth with Profitability
● Strive for harmony and mutual
benefit with communities
▶PP.33, 38
Safety
Quality
Environment
Compliance
List of Materialities
NSK REPORT
2024
17
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Special Feature: Taking on the Challenge to Change & Go Beyond
NSK’s Value Co-Creation Story
02
Taking up the challenge to Change & Go Beyond and
continuously creating new value in an effort to reinforce our position as an integral member of society,
garner trust, and remain the preferred company of choice,
Corporate Philosophy
Beyond
Contribute to the resolution of social
issues in new markets and domains
Provide new value to
existing customers
Bearings
Increase the added value of No. 1 products
by advancing core technologies
Core Technologies
● Tribology technology
● Materials technology
● Numerical analysis
technology
● Mechatronics
technology
No. 1 Products
● Ball bearings
● Precision bearings
● Precision ball screws
● Auto bearings
● Respond to needs in special
environments such as
hydrogen energy
Contribute to the widespread
use of renewable energy
New Proposals for
the Food Industry
● Edible oil deterioration
control filters
● Gas turbine generator bearings for
eVTOLs, including large drones
Contribute to new industries
2
● Condition Monitoring Solutions (CMS)
Enable predictive maintenance;
contribute to resource and energy saving
1
Take up the challenge in medical
and biotechnology fields
● Low dust emission,
decontamination actuator
● Precision control manipulator
Contribute to
electrification
● Ball screws used in electro-
hydraulic brake systems
―Bearings & Beyond
Initiatives―
Against the backdrop of a dramatically changing business environment, NSK’s goal is to reinforce its position as an integral member of society, garner trust, and remain the preferred
company of choice by taking up the challenge to Change & Go Beyond and continuously providing new value. Here, we provide details of our Bearings & Beyond initiative identified
under MTP2026.
Low dust emission,
decontamination
actuator
● Outdoor mobile robot
platform
● Motorized assistance
robot
Realize a robotic society that
coexists with humankind
3
NSK REPORT
2024
18
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK has initiated steps to develop an outdoor
mobile robot as a platform for service robots.
The outdoor mobile robot utilizes NSK’s core
technologies to achieve a design ideal for outdoor
use with a highly stable platform and autonomous
navigation all packaged in a low-profile body.
This enables the smooth and gentle transport of
objects on uneven surfaces and contributes to
the automation of transportation work in a wide
range of industries including the service industry.
NSK is committed to resolving customers’ issues
and creating new value in a bid to address the
growing need for automation of work including the
transport of objects to improve human resource
allocation, such as to bolster customer service,
and to improve occupational health and safety.
Currently, we are undertaking pilot testing at
service sites, analyzing user issues, and proposing
solutions.
In recent years, the development of electric vertical
take-off and landing (eVTOL) vehicles as a new
means of transportation has progressed to the
point where demand is projected to expand at an
accelerated pace. Previously, mainstream eVTOL
propulsion systems were completely motorized.
Looking ahead, however, the need for high output,
compact, and lightweight hybrid electric models is
forecast to grow. Against this backdrop, gas turbine
generators stand out from other hybrid motorized
models because they can use various fuel sources
such as biofuels and hydrogen, making them
attractive from a carbon neutrality perspective. NSK
developed and launched bearings for gas turbine
generator use in March 2024. The Company has
also developed a new lubrication mechanism that
significantly reduces the amount of lubricating oil
the bearing requires. This has contributed to further
reduction in weight while extending flight range.
Deliver products and services that provide new value through Change & Go Beyond initiatives
Condition monitoring solutions are critical to
the Company’s efforts to establish a product
lifecycle management (PLM) model that includes
equipment maintenance, repair, and disposal
after the sale of products. While equipment
maintenance is generally undertaken on a regular
basis at pre-determined times, in light of the focus
placed on ensuring a sustainable society, we have
witnessed growing calls for the unrestrained use of
products in recent years. This has in turn triggered
demand for timely maintenance in accordance
with the condition of equipment. By utilizing CMS
to monitor the operating status of products, steps
can be taken to detect damage and deterioration
at an early stage. In addition to facilitating the use
of products to the end of their service life prior
to replacement, monitoring also helps prevent
unexpected accidents. Moving forward, NSK
will expand its CMS business by integrating its
accumulated know-how and digital technologies in
combination with the extensive expertise of B&K
Vibro (acquired in 2021).
Condition Monitoring Solutions
(CMS)
Provide new product value
Gas turbine generator bearings
for eVTOLs
Bearings that support new industries
Outdoor mobile robot platform
Development with an eye toward a future in which
robots become a part of the societal infrastructure
Enable predictive maintenance;
contribute to resource and energy saving
1
Realize a robotic society that coexists
with humankind
3
Contribute to new industries
2
CMS Products and Services
High payload emergency supply delivery drone equipped with a gas
turbine generator
(Photo courtesy of Aero Development Japan, Inc.)
Outdoor mobile robot platform
NSK REPORT
2024
19
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
FY2022
FY2023
FY2024
FY2026
FY2030
● DX driving efficiency
● Ultra-stable production
● Unit cost reductions
Business growth
Steady improvement
776.8
788.9
820.0
900.0
5.6
3.5
4.4
8
10
■ Sales (￥Billions) Operating income margin (%)
865.2
1,000.0
3.4
8.0
8.0
0
2.0
4.0
6.0
8.0
10.0
12.0
or
more
9.1
9.7
10.0
8.0
The 6th MTP
The 5th MTP
1,020.3
991.4
747.6
831.0
871.7
974.9
940.0 975.3
949.2
1,000.0
7.8
10.0
9.6
6.9
2.8
0.9
FY2016
FY2017
FY2013
FY2014
FY2015
FY2020
FY2019
FY2018
FY2021
(¥ Billions)
（％）
■ Sales (¥ Billions) ■ Sales targets (¥ Billions) Operating income margin (%) Operating income margin targets （%）
The 4th MTP
0
200
400
600
800
1,000
Mid- to Long-Term Growth Strategies and Resource Allocation
03
Review of Past Mid-Term Management Plans and the Positioning of MTP2026
The 4th MTP
Establishing corporate fundamentals
appropriate for a company with
net sales of ¥1 trillion
Outline of the MTP
Growth with focus on profitability
Develop management
capabilities to handle
¥1 trillion in sales volume
Looking Back
● Secured substantial growth in the
China and steering businesses and
achieved an operating income
margin of 10%
● The Industrial Machinery Business
stalled in the final fiscal year of the
Mid-Term Management Plan owing
to such factors as the slowdown of
the Chinese economy
● Worked to evolve the global
management structure while
strengthening and enhancing
compliance
Challenges and Countermeasures
● Continue to build our foundation as
a company with ¥1 trillion in sales
● Establish a structure in which
business performance is not
significantly affected by various
factors, including business cycles
● Promote new products and
development in new areas
The 5th MTP
Embarking on a new chapter
in evolution toward the
next 100 years
Outline of the MTP
Operational excellence
Constant pursuit of competitiveness
Challenging innovation
Creation of new value
Looking Back
● Achieved sales of ¥1 trillion through
growth in the powertrain
Glossary
business and a recovery in the
Industrial Machinery Business
● Failed to achieve targets in the
final fiscal year of the Mid-Term
Management Plan due to
a downturn in the economic cycle
in the second half of FY2018 and the
impact of U.S.-China trade friction
● Promoted the development and
proposal of new technologies
and products amid technological
changes across various fields,
including IoT and AI
● Steering business entered
a transitional period
Challenges and Countermeasures
● Firmly achieve ¥1 trillion in sales and
a double-digit operating income
margin
● Restart growth in the steering businesss
● Improve productivity by leveraging ICT
The 6th MTP
Building the business base and
strengthening resources in preparation
for the next growth phase
Outline of the MTP
New initiatives targeting growth
Enhance managerial resources
Contribute to the environment and society
Looking Back
● Significant changes in the business environment
attributable to such factors as COVID-19, rapid
inflation impacting material and other prices,
and disruptions to the supply chain
● The Industrial Machinery Business
set new records on the back of growth
in the semiconductor manufacturing
equipment, machine tools, and robotics
markets; however, failed to achieve a
double-digit operating income margin;
second consecutive fiscal year of losses
in the Automotive Business
● Maintained an “A” credit rating due
to financial stability
Challenges and Countermeasures
● Reflect cost increases due to
inflation in selling prices
● Secure a recovery in profitability in the
Automotive Business, mainly by returning
the steering business to the black, and firmly
achieving a double-digit operating income
margin in the Industrial Machinery Business
● Carbon neutrality
● Enhancement of managerial resources
FY2030
Post MTP2026 Vision
A company that is
needed, trusted,
and relied upon
by society
A culture of taking up
the challenge of
pursuing high
future-oriented goals
We aim to be a needed and trusted company that
contributes to the development of a sustainable
society by creating new value through the fusion
of tribology and information technology.
Create
new
value
Operational
excellence
Change &
Go Beyond
MTP2026
Rebuilding the corporate foundation
for sustainable growth
ESG Management
Deterioration
of the business
environment
Behind
schedule
Promoting activities to increase productivity by 1.5x
Progress in line with plans
Growth with Profitability
Promote carbon neutrality
Create better working
environments
Bearings ＆ Beyond
Restructure the steering
business
Pursue alliances and M&A
Enhancement of Managerial Resources
Engage information technology in all areas
Ultra-stable production
leveraging a diverse workforce
Portfolio reform
through efforts to
deepen and expand
the application of
core technologies
Industrial
Machinery
Business
:
6
4
Automotive
Business
Pursuit of No. 1 quality
and trust utilizing DX
1.5x productivity
Three Key Management Issues
Current progress
in excess of plans
Reduction in CO2
emissions of 52%
(compared
with FY2017
Scope 1, 2)
Performance Trends (The 4th MTP based on JP-GAAP, IFRS from the 5th MTP onward)
Sales and Operating Income Margin
NSK REPORT
2024
20
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Mid- to Long-Term Growth Strategies and Resource Allocation
03
Continued sluggish demand against the backdrop of rising interest rates
in many countries and a slowdown in the Chinese economy
Global inflation including energy and labor costs
Industrial Machinery Business Continued adjustments in demand from the second half despite
record-high results in FY2022; delays in a recovery
Automotive Business
Decline in global automotive production volume compared with
assumptions made at the time of Mid-Term Management Plan formulation
Steering Business
Establishment of a joint venture with JIS in August 2023; conversion
to an equity-method affiliate
Market Assumptions
At the time of MTP2026 formulation
As of the end of FY2023
FY2023
FY2026
FY2023
FY2026
Outlook for machine tool related orders (￥ Trillions)
(NSK outlook based on JAMA data)
1.8
2.0
1.5
1.7
Outlook for semiconductor manufacturing
equipment demand (US$ Billions)
(NSK outlook based on SEMI and Gartner data)
110
130
100
120
Outlook for global automotive production
(Million vehicles, NSK outlook)
92
98
90
92
Changing Business Environment
Policy for the Second Half of the Mid-Term Management Plan
Targeting Change & Go Beyond
NSK launched MTP2026 in FY2022 and has continued to address three key management issues. As far as growth with profitability, one of the three issues, is concerned, NSK reset its
FY2026 financial targets. The decision to reset these targets was based on changes in the business environment assumptions that underpinned MTP2026 at the time of its formulation,
and the subsequent delay in securing a recovery in profitability, as well as the transition of the steering business to a joint venture in August 2023. Despite the downward revision in
original targets, we will target an ROE of 8% in FY2026 and 10% thereafter by working to trigger a recovery from the deterioration in profitability attributable to changes in the business
environment and strengthening the Company’s business foundation through sales growth and portfolio reform.
Downward revision: Sales ￥900 billion Operating income ￥75 billion
Operating income margin 8% ROE 8%
● New targets exclude sales and profits of the steering business
● Maintained sales targets in the Industrial Machinery and Automotive businesses
● Adjusted the Industrial Machinery Business operating income target to reflect
the decline in real volume; maintained the Automotive Business operating
income target (excluding the steering business)
Management Policies
Initiatives
● Continue initiatives toward Three Key
Management Tasks
● Profitability improvement is top priority
● Maintain investment in human resources,
environment, DX
● Business portfolio reform
● Expand Industrial Machinery
● Secure share in EV
● New products to market
Growth
● Ultra-stabilization of production
● DX driving efficiency
● Unit cost reductions, transfer labor cost increases to sales prices
● Execute structural reform/production reorganization
Structural
reforms
Three key
management
tasks
Growth with
profitability
Enhance
managerial
resources
ESG
management
Review of FY2026 Financial Targets and New Target Initiatives
100.0
-48.0
-5.0
+12.0
+16.0
75.0
Volume/
Mix
Decline in
profitability
New
improvement
initiatives
Exchange
rate
● Transition of the steering business to a JV -8.0
● Decline in real volume
-40.0
(Decrease in real volume excluding price
increases and the impact of forex
Industrial Machinery: -￥5.0 billion
Automotive: -￥5.0 billion)
● Structural reforms +9.0
● Portfolio reform
+3.0
FY2026
original target
FY2026
new target
(Billions of yen)
KPIs
Original Targets
New Targets
Sales
Over ￥1 trillion
￥900 billion
Industrial Machinery
Business
￥450 billion
￥450 billion
Automotive Business
(excluding steering)
￥410 billion
￥410 billion
Steering business
￥220 billion
ー
Operating income
￥100 billion
￥75 billion
Operating income margin
10%
8%
Industrial Machinery
Business
13%
10%
Automotive Business
(excluding steering)
7%
7%
Steering business
4%
ー
ROE
10%
8%
ROIC
8%
6%
Net D/E ratio
Below 0.4x
Below 0.4x
Forex rate
USD1:￥112
USD1:￥140
Factors Behind the Change in
Operating Income
Environment
Reduce the Group’s manufacturing-based business
activity CO2 emissions(Scope 1 + 2 vs. FY2017)
FY2023 result: -52% (FY2026 target: -50%)
Contribute to the reduction of CO2 emissions
generated through the use of products
FY2023 result: 2,435 thousand-t
(FY2026 target: 3,000 thousand-t)
Issuance of sustainability-linked bonds (September 2023)
Social
Disclosure of the Group’s human rights policy (October 2022); White 500 certification for
7 consecutive years; thorough compliance training (e.g., engineer ethics, quality)
Governance
Abolishment of takeover defense measures (May 2023)
Create an environment
conducive to the shift to
digitalization
● DX human resources development program under way (More than 80% progress against the
target of 5,000 trainees)
● Promoting the renewal of core systems
Ultra-stable production
● Activities under way to secure a 1.5x increase in productivity 43% of target lines commenced as of FY2023
leveraging a diverse
workforce
● Diversity ratio* FY2023: 29% (FY2026 target: 35%)
● Strengthen tribology technology collaboration with the Tokyo Institute of Technology
ESG management
Enhance managerial
resources
* Women, foreign nationals, mid-career hires; excluding the steering business from FY2023
NSK REPORT
2024
21
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Mid- to Long-Term Growth Strategies and Resource Allocation
03
Business Strategy 1 Strategy and Progress of the
Industrial Machinery Business
Strategies by Sector
Growth/Expansion
Improve Profitability
Industrial Machinery Bearings General Machinery (OEM)/Aftermarket (AM)/CMS
Precision Machinery and Parts
Industrial Machinery Bearings E&E (Electrical & Electrification)
FY2022 FY2023 FY2024
Forecast
FY2026
New Target
(¥ Billions)
0
150
100
50
■■AM・CMS ■■OEM
FY2022 FY2023 FY2024
Forecast
FY2026
New Target
(¥ Billions)
0
80
60
40
20
Return to
the black
Profitability↑
FY2022 FY2023 FY2024
Forecast
FY2026
New Target
(¥ Billions)
0
120
100
80
60
40
20
● AM EU/US sales expansion
The
Americas
Collaboration with key distributors
Wind turbine bearing repair
business acquisition
Strengthen supply bases
Europe Expand business in Eastern Europe
● Expand the CMS sector
● Pharmaceuticals/steel/paper
● Plug & Play Solutions to market
Business reform
through production
reorganization
● OEM product differentiation
● Support for sophisticated machine tools
● Longer service life in special environments
Machine tools/robots/wind power/railways/
new energy
● New products/entry into
new business areas
Service robots
Industrial actuators
● Growth with Profitability
Technology differentiation
in growth markets
● Semiconductors/rechargeable
battery related
● Completion of
global production
reorganization
Production transfer and
consolidation in Japan,
U.S.A., and Asia
● Structural reforms in
Europe
● Utilize bases to expand AM
sales in North America
Supply capacity and quick
delivery
● Commercial/general machinery
Sales
Sales
Sales
Active Caster
“PalGo”
MTP2026 Growth Vision
385.1
（9.2%）
450.0
（10%）
450.0
（13%）
344.8
（2.3%）
378.0
（5.0%）
FY2022
FY2023
FY2024
Forecast
Original
Target
FY2026
New Target
(¥ Billions)
Sales (segment income margin)
Expand the
Industrial Machinery
Business portfolio
44%
FY2023
50%
FY2026
FY2026 Target
While lowering our original target of 13%, our
operating income margin has improved to just above
10% owing to the market’s recovery and positive
flow-on effects of sales growth.
Segment income margin
10%
Sales
450.0 billion
￥
MTP2026 Goals
Recognizing advances in the electrification, automation, digitalization, and environmental markets as
an opportunity for growth over the mid to long term, NSK is working to expand its Industrial Machinery
Business portfolio. However, in light of the slower than originally planned recovery in demand owing
to such factors as interest rate hikes in several countries and a slowdown in the Chinese economy, the
Company revised its targets for FY2026. Despite a downward revision, the direction of our business growth
strategy remains unchanged. Meanwhile, profitability in the E&E business is declining due to the market’s
deterioration and the impact of inflation. To address this decline, we are working to improve our earnings
structure by restructuring global production focusing mainly on the European region.
● Extensive product lineup as a comprehensive bearing
manufacturer
● Technological capabilities based on our Four Core Technologies
plus One
● Strengths in precision technology, including precision bearings
and precision ball screws
● Accumulated expertise in customer needs and technology for a
wide range of industries and applications
● Technological capabilities and production control methods
cultivated in the Automotive Business
● Manufacturing, supply, and technical support capabilities based
on a global network framework
Industrial Machinery Business Strengths
Changing Business Environment
Risks and Opportunities
● Electrification, automation, etc.,
expanding capital investment demand
● Slowdown in the Chinese
economy
● Prolonged inventory adjustments
● Prolonged slump in China
● Rise of Chinese competitors
Risk
● Expand in markets that benefit from NSK’s technologies
- Semiconductors, machine tools, robots, railway, etc.
● New growth markets, including new energy
Opportunities
Key Issues and Initiatives
Growth/Expansion
●Strengthen supply capacity
●●AM sales expansion/enter new sectors
Improve profitability
●E&E business production
reorganization
NSK REPORT
2024
22
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK’s technical points
The world’s first practical application of a highly accurate
bearing life prediction method applying ultrasonic
testing was incorporated into the online catalog.
(Improved basic dynamic load ratings up to a maximum of twice
the estimated life)
Customers are able to leverage the long-life
performance of NSK bearings in their machine design.
Contributes to the downsizing and
weight reduction of machines
Contributes to build a
carbon-neutral world
● Outside diameter: Down approx. 14%
● Assembled width: Down approx. 13%
● Weight: Down approx. 38%
● Torque and power consumption:
Down approx. 18%
● CO2 emissions*
2 during bearing usage:
Down approx. 22 kg per bearing
Tapered roller bearing example:
If HR32306J is replaced with HR33206J.
Strategies to Change & Go Beyond
Initiatives aimed at expanding the aftermarket business
NSK is expanding its aftermarket (AM) Industrial
Machinery Business operations, which largely cater to the
commercial and maintenance markets. In the commercial
market, considerable emphasis is placed on improving the
performance of standard products and the ease of product
selection. As a part of these efforts, we are utilizing a
wealth of technical data and the latest digital technology
to better help customers in their selection of products.
This includes the world’s first practical application of the
Micro-UT method
Glossary for highly accurate bearing life*1
prediction and a renewed engineering tool that is available
online. With customers’ requirements and the need to put
forward value-added proposals uppermost in their minds,
field engineers in each region propose solutions to issues
on a daily basis. Examples include condition monitoring
systems (CMS) for equipment where machine stoppages
are not an option. Through these means, NSK is working to
ensure optimal product lifecycle management (PLM).
*1 A technique for accurately predicting the life of a rolling bearing based on
the size and amount (statistical data) of non-metallic inclusions in the steel
(Patent applied for).
*2 Results based on NSK estimation.
Online catalog
Reflected revised basic dynamic
load ratings
2D/3D CAD data
download
Downloadable
without user
registration
Technical
calculations
Enabled
multiple item
calculation
and multi-list
view
Providing a more efficient product
selection tool
● Three engineering tools updated
● Functions linked across tools to provide one-stop
solution for various tasks, from selecting bearings, to
confirming specifications, to downloading CAD data
A Look Back at the Business Conditions for FY2023 and the Forecast for FY2024
The market downturn has prolonged due to ongoing adjustment in the
semiconductor market and the impact of the stagnant Chinese economy.
In addition, demand has been sluggish due to the influence of inventory
adjustments. As a result, sales decreased compared to the previous fiscal year.
Looking at the Company’s results by geographic breakdown, demand in Japan
declined due to deteriorating market conditions, particularly in machine tools,
semiconductor manufacturing equipment, and the aftermarket. In the U.S., sales
for semiconductor manufacturing equipment declined, and in Europe, aftermarket
sales slowed down. In China, sales declined due to soft demand in the aftermarket,
machine tools, and electrical and electronics applications.
As a result, sales in the industrial machinery business segment totaled ¥344.8
billion, a year-on-year decrease of 10.5%, and operating income was ¥8.0 billion,
a year-on-year decrease of 77.5%.
In this business, the Company will work to strengthen supply capabilities and
enhance the technical services system to absorb the increase in demand from the
electrification, automation, digitalization, and environment-related markets, for
which growth is anticipated. Moreover, the Company aims to expand the Industrial
Machinery Business by promoting the development and market introduction of
condition monitoring systems (CMS), actuators, and other new value-added products.
(¥ Billions)
0
100
200
300
400
500
FY2021
FY2023 FY2024
(Forecast)
FY2022
FY2020
41.1
275.2
234.1
62.0
352.2
290.2
69.2
385.1
315.9
48.3
344.8
296.5
58.0
378.0
320.0
■ Industrial Machinery Bearings
■ Precision Machinery and Parts
Sales Trends
(¥ Billions)
（%）
0
10
20
30
40
50
FY2021
FY2023 FY2024
(Forecast)
FY2022
FY2020
■ Operating Income (left)
Operating Income Margin (right)
5.0%
19.0
2.8%
7.7
8.6%
30.4
9.2%
35.5
2.3%
8.0
0
2
4
6
8
10
12
Operating Income/Operating Income Margin Trends
NSK REPORT
2024
23
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Mid- to Long-Term Growth Strategies and Resource Allocation
03
Business Strategy 2 Strategy and Progress of the
Automotive Business
● Diverse business relationships and customer base as an
independent manufacturer with automakers and first-tier
automotive components manufacturers built up over many years
● Supply system in areas of demand (robust supply chain system
based on local production for local consumption), ability to meet
global demand from each of the sales and technology perspectives
● Developmental capabilities and technical expertise critical
to addressing the shift to EVs and increasingly advanced
automobile functionality (Four Core Technologies plus One;
trend toward reductions in both size and weight, lower torque,
and lower friction, and electric erosion resistance)
● Ball screw technologies cultivated through industrial machinery
Automotive Business Strengths
Change in business environment
Risks/Opportunities
Challenges to Address
● Recovery of Automotive
Production volume
(98 mil vehicle/yr)
● Acceleration of electrification
● China slowdown
● Stagnation of volume
(92 mil vehicles/yr)
Growth/Expansion
●EV sales expansion to drive profitability and growth
Technology differentiation: Electric erosion/high durability/low torque/quiet operation
Develop new products ahead of competitors
●●Market new products and increase development speed
(Strengthen local R&D for China market)
Profitability Improvement
●ICE product production reorganization
● Increased price competition
● Accelerating pace of
development
Risks
● Increase in opportunities to
cultivate new customers and
propose new products on
the back of the shift to EVs
Opportunities
MTP2026 Growth Vision
FY2022
FY2023
FY2024
Forecast
Original
Target
FY2026
New Target
(¥ Billions) ■■■ICE-Related Product Sales ■■■EV-Related Product Sales
Automotive production volume (millions of vehicles) (electric vehicle ratio, BEV + HEV)NSK forecast
359.4
（1.8%）
82（28%）
90（33%）
90
92（56%）
98（40%）
15%
15%
21%
45%
40%
410.0
（7%）
410.0
（7%）
408.8
（4.5%）
405.0
（4.4%）
EV-related product
sales growth
Sales (segment income margin)
MTP2026 Goals
Against the backdrop of an expanding electric vehicle market, including HEVs, NSK is working to reform
its Automotive Business portfolio. In specific terms, steps are being taken to shift from products for
conventional internal combustion engines (ICE) to products for EVs, thereby lifting sales of the latter.
New high-margin orders and sales for EV products continue to steadily expand on the back of such factors
as successful efforts to differentiate the Group’s technologies. In light of the subsequent downturn in ICE
product volume, preparatory steps are being taken to reorganize the production structure. Meanwhile, taking
into consideration the current business environment, we revised our original automotive production forecast
assumption from 98 million units to 92 million units for FY2026. Despite this downward revision, original
FY2026 target plans remain unchanged owing to such factors as trends in foreign currency exchange rates.
NSK’s Growth Engine in the EV Market
sales
expansion
eAxle
bearings
sales
expansion
Hub unit bearings
New
products
Ball screws for electric-hydraulic
brake systems
● Electric erosion problem due to adopting higher
voltage/output motors
● High-speed rotation/low friction
● Longer driving range
● Battery increases weight, demands higher durability
● Demand increase driven by regulatory requirements
● Small/high capacity
● Highly responsive/control
Conductive brush set
Ceramic Ball
Bearings
Technology/Market Needs
NSK proprietary manufacturing technology enables
small and light design
Ball screw type systems offer superior response/
control
Low friction with high durability
≫Gen 3 tapered hub unit bearing
Comprehensively meet diverse needs in electric
erosion/high-speed/low friction
NSK Product Features
Overmolded bearings
FY2026 Target
Work to achieve a 7% operating income
margin through EV sales growth and
measures aimed at improving profit
Segment income
margin
7%
Sales
410 billion
￥
Portfolio reform
● Increase market share by
winning orders for high
value-added products
● Growth in the electric brake ball
screw business to ￥30 billion
● Non-Japanese customer growth
Reference: Bearing demand (NSK forecast)
ICE 100 : BEV 80 : HEV 110
NSK REPORT
2024
24
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Nut + Bearing
Screw
shaft
● Expand the
rate of EPS
installation
● Column-type
EPS-based
growth
● Decrease in automotive
production
● Changes in EPS trends
● Decrease in profitability
impacted by the drop in sales
● Commenced steps to reform the steering
business structure in FY2021
FY
2010
FY
2017
FY
2018
FY
2019
FY
2020
FY
2022
FY
2021
(¥ Billions)
0
100
200
300
● Established a steering business joint venture
● Concluded a joint-venture agreement with JIS
● Change in the status of NSK Steering & Control,
Inc., a subsidiary of the Company, to an
equity-method affiliate on August 1, 2023
(shareholding ratio: NSK 49.9%, JIS 50.1%)
● Promote further structural reform to
improve profitability
● Promote independent operations
● Explore opportunities for alliances with strategic partners
● Strengthen the monitoring system
● Purpose
Reorganizing the steering business into a JV
NSK’s steering business grew over FY2017 on the back of upswings in
the EPS installation rate and global automotive production. Thereafter,
earnings declined owing to such factors as the impact of COVID-19. Taking
the aforementioned into consideration, and with an eye to the future, NSK
initiated steps to reform its steering business structure. In specific terms, the
Company established a steering business joint venture with Japan Industrial
Solutions III Investment Limited Partnership (JIS). Currently, we are
considering alliances with new strategic partners under the umbrella of the
new joint venture company.
Steering Business Sales
● The number of vehicles equipped with
electric brake systems is expected to expand
as the mandatory installation of automatic
braking systems progressively takes hold
Market Environment
Technological Advantages
● Ball screw type systems are highly
responsive, efficient, and reliable
● Achieved smaller/higher capacity systems
through the use of NSK’s proprietary technologies
FY2026 Target
Orders
More than10million units
Sales
￥30billion
Share
50％
Electric-hydraulic brake systems
Ball screws for electric-hydraulic brake
systems and other initiatives
FY2021
FY2023 FY2024
(Forecast)
FY2022
FY2020
152.9
408.8
329.6
151.5
298.2
405.0
359.4
482.5
449.7
0
100
200
300
400
500
600
(¥ Billions) ■ Automotive Bearings + Automatic Transmission Components
■ Steering
（%）
-20
-10
0
10
20
30
40
FY2021
FY2023 FY2024
(Forecast)
FY2022
FY2020
4.4%
18.0
-0.9%
-4.0
-2.9%
-13.8
1.8%
6.3
4.5%
18.6
-4
-2
0
2
4
6
8
(¥ Billions) ■ Operating Income (left)
Operating Income Margin (right)
Sales Trends
Operating Income and Operating Income Margin Trends
* Historically, NSK has separately disclosed details of its automotive bearings and automotive components sales. Accounting for the steering business’
classification as a discontinued operation in FY2023, FY2022 data was retroactively adjusted and disclosed solely on an Automotive Business basis. Meanwhile,
equity in earnings of the joint venture with JIS, established on August 1, 2023, is included in segment income from the second quarter of FY2023.
Strategies to Change & Go Beyond
Strategy to expand ball screws for electric-hydraulic brake systems
The mandatory installation
of automatic braking
systems is progressively
taking hold in line with
efforts to achieve a safe
and secure society. As a
result, demand for highly
safe electric brake systems
is expected to increase.
While there are several
types of electric-hydraulic
brake systems, the ball
screw type, which stands
out for its responsiveness
and efficiency, accounts for
around 50% of the total.
NSK is working to expand
its business in a bid to
address growing demand.
A Look Back at the Business Conditions for FY2023 and the Forecast for FY2024
Global automotive production volume increased due to the production
adjustments being resolved from the easing of parts supply constraints. As a result,
sales increased year-on-year. Looking at the Company’s results by geographic
breakdown, in Japan, U.S. and Europe sales increased year-on-year as automotive
production recovered from parts supply constraints seen in the previous year. In
China, sales increased year-on-year due to the rebound from the decline triggered
by strict restrictions on economic activities based on its Zero-COVID policy during
the previous year.
As a result, sales in the automotive business segment totaled ¥408.8 billion,
a year-on-year increase of 13.8% and operating income was ¥18.6 billion, a year-
on-year increase of 193.6%.
In this segment, we will strengthen our competitiveness by leveraging the low
torque, high-speed rotation, and light weight technological capabilities possessed
by the Group in response to the electrification of automobiles and aim to grow the
business by working to expand new products for the future, including ball screws
for electric-hydraulic brake systems.
NSK REPORT
2024
25
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Financial
Strategy
Basic Policy
Management
Indicators
FY2023
MTP2026
New Target
FY2024 Evaluation
and Comments
Maintenance of
Financial Stability
Net D/E
ratio
0.26
times
0.4 times
or less
Maintained a sound
financial structure
Growth
with
Profitability
ROE
1.3％
8%
Delays in the Company’s
earnings plan due to
changes in the business
environment. However,
a plan has been
established to carry out a
variety of measures in a
bid to secure an ROE of
10% post FY2026.
ROIC
1.5％
6%
Stabilization
of
Shareholder
Return
Payout
ratio
173.8%
30％‒50％
Dividend: ¥30 per share
Continue stable
shareholder returns;
adopt DOE from FY2024
DOE
2.4％
Lower
limit of
about 2.5%
Message from the CFO
Targeting sustainable growth through
improvements in profitability and
effective cash allocation
Keita Suzuki Director
Representative Executive Officer,
Executive Vice President, and CFO
NSK is actively working to achieve its Mid-Term
Management Plan, which covers the five years from
FY2022 to FY2026. Amid changes in the business
environment initially envisioned, financial results in
FY2023, the second year of the Plan, were mixed. In
specific terms, sales increased ￥12.1 billion compared
with the previous fiscal year to ￥788.9 billion. In
contrast, operating income decreased ￥16.4 billion
year on year to ￥27.4 billion. In addition, NSK’s net
income attributable to owners of the parent, the sum
of continuing and discontinued operations, came in
at ¥8.5 billion, a year-on-year decrease of 53.8% after
accounting for such factors as the partial reversal
of deferred tax assets in Europe. Taking also into
consideration our ROE of 1.3%, we are far from satisfied
with these results.
One key initiative during the second half of the Mid-
Term Management Plan is to improve profitability in
the European region. Buffeted by a weak economy and
deterioration in its product mix, NSK is experiencing
difficulties in maintaining profitable operations. Owing
to its poor performance, the Company has also failed at
times to adequately upgrade its production facilities. As
a result, we have witnessed a downturn in profitability
due to the decline in productivity attributable to aging
plants and equipment. While the acquisition by our
small motor E&E segment of a state-owned company
and its mainstay plant in Poland has since contributed
significantly to NSK’s growth, Poland’s decision to join the
EU, rising labor costs, and the sharp surge in energy costs
associated with the conflict in Ukraine, coupled with the
aforementioned factors, have led to continued difficult
conditions and our ongoing inability to boost profits.
Under these circumstances, we undertook a review
of our Mid-Term Management Plan. As a part of this
review, we took the bold step to reform the structure of
our business in Europe. Together with efforts to put in
place a more resilient earnings structure, we are working
to engage in optimal global production. To this end, we
will invest a total of ￥6 billion (￥5 billion in FY2024 and
￥1 billion in FY2025) in structural reforms, mainly in
Europe, which we project will help improve profitability
by ￥9 billion per year in FY2026 compared with FY2023.
Recognizing the critical role this initiative will also play
Evaluating progress over the first
half of MTP2026
Promote structural reforms in Europe
toward the second half of MTP2026
Based on the incidence of delays compared to
initially forecast plans owing to changes in the business
environment, and the transition of the steering
business to a joint venture, we reviewed and disclosed
details of revised MTP2026 targets in May 2024. NSK is
now targeting sales of ￥900 billion, operating income
of ￥75 billion, an operating income margin of 8%, an
ROE of 8%, and an ROIC of 6%.
Looking back on progress by business in FY2022,
the first year of MTP2026, the Automotive Business
initially confronted a harsh operating environment
most notably impacted by such factors as daily
fluctuations in customers’ production volume plans
owing to shortages in semiconductors and other
components. Thereafter, in FY2023, these difficult
conditions gradually began to dissipate. Despite minor
fluctuations in profitability, automobile production
volumes grew and financial results trended toward
a recovery. Buoyed also by progress in passing on
inflation costs to selling prices, successful steps were
taken to secure an operating income margin of 5%.
Meanwhile, NSK reported record-high sales in the
Industrial Machinery Business in FY2022 on the back
of robust demand over the first half. Conversely, the
downturn in demand that began from the second half,
owing to weak real estate market conditions and the
subsequent slowdown in China’s economy, continued
into FY2023. Because the marginal profit margin in the
Industrial Machinery Business is higher than that of the
Automotive Business, the impact of fluctuations in the
amounts of raw materials is also greater. NSK’s Industrial
Machinery Business precision machinery and parts for
machine tools and semiconductor production equipment,
products in which the Company is strong, are especially
vulnerable. For this reason, we recognize the need to
bolster our resilience to the effects of fluctuations.
Mid- to Long-Term Growth Strategies and Resource Allocation
03
NSK REPORT
2024
26
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Maintaining our financial stability is essential to
both ensuring our sustainable growth and our ability
to withstand changes in our business environment.
Against this backdrop, the Group’s equity ratio, net
D/E ratio, liquidity on hand, and other indicators that
measure its financial stability and health remain sound.
NSK has set a net D/E ratio target of below 0.4 times
under MTP2026. Even as the need to allocate cash for
such investments as
M&As arise, we will
engage in the flexible
and effective use of
interest-bearing debt
after securing a stable
financial base.
Our personnel system is an issue of particular note.
Here, we have introduced a role-based system
for managerial positions. Human resources are
critical to improving corporate value. With this in
mind, we will continue to invest broadly in human
capital, including development and training.
▶ P.36 Human Capital: Introducing a New Personnel System
▶ PP.42‒49 Environmental Management
Growth with profitability
Continue stabilization of
shareholder returns
Invest for sustainable growth
Strengthen managerial resources
MTP2026 Financial Strategy Basic Policy
●R&D expenses: 3%‒4％ of sales
Cash generation
Operating income margin of 8%
Depreciation
Cross-shareholdings (in principle, not held)
Reduce low-profit assets
ESG management
▶Ordinary investment: ￥160.0billion
▶Increased investment: ￥70.0billion
▶New technologies:
￥50.0billion
●Investments aimed at improving corporate value Investment in human capital
Investments in DX, M&As, other
●Payout ratio: 30%‒50%
●DOE of about 2.5% set as a lower limit for
each period
●Share buybacks flexibly implemented
￥400.0 billion -￥500.0 billion/5 years
Remaining 3 years:
￥180.0 billion
●Capital expenditures:
￥280.0 billion/5 years
￥100.0 Over 100bn / 5yr
Maintain capacity/
infrastructure
Expand the Industrial
Machinery Business/
super-stabilize production
DX/new products
Rating and
Investment
Information,
Inc. (R&I)
Japan Credit
Rating Agency,
Ltd. (JCR)
A
A+
in improving ROE, we will pull out all the stops to bring
these investments to fruition.
of measures, including M&As, as a part of efforts to
improve our corporate value.
From a share buyback perspective, NSK acquired 25
million of its own common shares at an acquisition cost
of ￥21.7 billion and cancelled 51.27 million of treasury
shares in FY2023. Timing and conditions are key factors
in the acquisition of treasury shares. Accordingly, we
will undertake the buyback of shares in an appropriate
and flexible manner based on a variety of factors.
Turning to another key component in securing
sustainable corporate growth, we recognize the critical
need to invest in various measures aimed at addressing
ESG concerns. With this in mind, I believe that we
must put in place a cycle through which we allocate
the earnings generated by our business activities
to measures designed to resolve social issues. For
example, in a bid to help resolve environmental issues,
our goal is to become carbon neutral by minimizing
the environmental impact of our business activities at
the “creation” stage and maximizing the environmental
contribution of our products at the “utilization” stage.
I am convinced that in establishing this cycle, we will
be better placed to mitigate ESG risks, which in turn
will lead to a reduction in the cost of capital.
NSK must better align its structure and systems to
anticipated changes in its operating environment.
We are confident in our ability to generate between
￥400 to ￥500 billion in cash over the five years of
MTP2026 through various means, including operating
cash flows and the reduction of cross-shareholdings.
Of this total, we will allocate ￥280 billion to measures
aimed at securing sustainable growth. Working
diligently to realize the Group’s concept of Bearings &
Beyond, we will not only engage in recurring
investments that include the maintenance of facility
capacity but also allocate cash to help expand the
Industrial Machinery Business as a part of our portfolio
reform endeavors, as well as such investments as DX
and the development of new products.
As far as shareholder returns are concerned, we
have set a dividend payout ratio of between 30% to
50% and 2.5% as a lower limit for DOE as indicators.
By reflecting upside in the dividend payout ratio and
indicating stable dividends through DOE, we are
projecting shareholder returns of at least ￥100 billion
over five years. Moreover, we are considering a variety
MTP2026 basic policy
on the allocation of cash
Approach to maintaining
financial stability and financial leverage
In reviewing our Mid-Term Management Plan, we
reiterated our stance to refrain from holding cross-
shareholdings as a general rule. We also recognize
the critical need to use the cash generated through
the sale of cross-shareholdings to help secure growth
with profitability, increase earnings capacity, and
enhance our corporate value. While coming in at
15.1% as of the end of FY2022, NSK’s proportion of
cross-shareholdings to total consolidated capital fell
to 5.5% as of the end of FY2023, and deemed holdings
of equity securities held for purposes other than pure
investment were reduced to zero. In April 2023, we
were able to return part of the cash from the reduction
of deemed holdings in FY2022 to the company.
▶ P.64 Corporate Governance: Cross-Shareholdings
Reduction of cross-shareholdings
Financial Strategy: Cash Allocation
NSK REPORT
2024
27
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Fiscal Year
High (Yen)
Low (Yen)
Fiscal Year-End
(Yen)
Volatility*
2014
1,815
1,023
1,758
32.6%
2015
2,120
910
1,030
39.0%
2016
1,739
691
1,592
44.3%
2017
1,916
1,261
1,426
28.5%
2018
1,488
885
1,037
26.1%
2019
1,208
579
694
33.7%
2020
1,202
581
1,135
43.2%
2021
1,141
630
736
30.6%
2022
803
680
756
23.6%
2023
932
729
884
25.1%
Investment
Period
1 Year
3 Years
5 Years
10 Years
Cumulative/
Annual Rate
Cumulative Annual
Rate
Cumulative Annual
Rate
Cumulative Annual
Rate
NSK
20.9%
-14.7%
-5.2%
-1.8%
-0.4%
12.9%
1.2%
TOPIX
41.3%
52.5%
15.1%
96.2%
14.4%
188.6%
11.2%
TOPIX
Machinery
46.2%
52.8%
15.2%
117.0%
16.7%
201.8%
11.7%
2022/3
2023/3
2024/3
2021/3
2020/3
2019/3
2018/3
2017/3
2016/3
2015/3
2014/3
(Index)
NSK
TOPIX
TOPIX Machinery
50
100
150
200
250
300
350
15.3 14.3
9.9
13.9
10.4
3.3
0.1
2.8
3.0
1.3
3
8
10
FY
2014
FY
2015
FY
2016
FY
2017
FY
2018
FY
2019
FY
2020
FY
2021
FY
2022
FY
2023
FY
2026
FY
2024
FY
2030
（%）
The Company’s cost of
capital is estimated at
roughly 8%‒9%.
2.1
1.2
1.8
1.4
1.0
0.7
1.0
0.6
0.6
0.7
(Times)
FY
2015
FY
2014
FY
2016
FY
2017
FY
2018
FY
2019
FY
2020
FY
2021
FY
2022
FY
2023
-11.0
-21.0
-15.0
+15.0
+35.0
+21.0
+6.0
+9.0
+10.0
27.4
75.0
Operating Income (¥ Billions)
(Operating Income Margin)
Structural reforms
Growth/
Expansion ＋40.0
Reduction in fixed costs
Inflation/
Labor cost
increase
Market
growth
Enhance
supply
capacity
Transfer the
increase in costs
to sales prices
Structural
reforms
Other
FY2023
Results
FY2026
Target
(3.5％)
Sales
expansion
Portfolio
reform
DX,
Environment,
New technology
investment
＋25.0
Effect of
ultra-
stabilization
and DX
Reduction
in unit
costs
-1.4
(8％)
+￥1.0 billion
FY2024
－￥5.0 billion －￥1.0 billion
―
Effect of structural reform/production
reorganization (vs. FY2023, cumulative)
FY2025
FY2026
One-time expenses
(annum)
+￥6.5 billion +￥9.0 billion
Continuing to underperform the TOPIX and TOPIX
Machinery indices, NSK recognizes that the inability of
its share price to break out of the ￥700 to ￥900 range,
representing a PBR below 1, is a top management issue.
We are acutely aware of the need to secure an ROE
that exceeds the cost of capital (an ROE of roughly
8%‒9%) if we are to address this issue. To this end, it is
vital that we first put in place an earnings structure that
reflects the new financial targets set under MTP2026,
namely sales of ￥900 billion, operating income of ￥75
billion, and an operating income margin of 8%. Looking
at the Group’s growth and expansion endeavors
identified in its profitability improvement road map
to FY2026, we will work diligently to expand sales of
high-profit products, improve our business portfolio,
and seize opportunities for growth in burgeoning
markets. As a part of our structural reform initiatives,
and in addition to engaging in ultra-stable production
and increasing efficiency through DX, we will reap
the benefits of measures aimed at reorganizing
production, including efforts to reform the structure
of our European operations. At the same time, we will
push forward a raft of effective measures, including
the reduction of cross-shareholdings while providing
appropriate shareholder returns. By improving the
efficiency of our assets, our goal is to lift ROE to 8% in
FY2026 and 10% in FY2026.
Evaluation of NSK’s share price and PBR
NSK’s Share Price Trend (10-year period)
Trend of PBR
Trend of ROE
FY2023→FY2026 Profi tability Improvement Road Map
Share Price Trend by Fiscal Year
TSR
Message from the CFO
Note: Share price index trend including dividends (March 31, 2014 = 100)
* Volatility refers to the standard deviation annualized rate based on
the daily closing price.
Note: PBR is calculated based on the share price as of the end of each fiscal year.
Notes: 1. TSR (Total Shareholder Return): Total return on investment including capital gains and dividends
2. Each index includes dividends.
3. Annual rate based on the geometric mean
4. Compiled by NSK from Quick Factset data
Mid- to Long-Term Growth Strategies and Resource Allocation
03
NSK REPORT
2024
28
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
● Core sector sales ratio
● Number of new products/
Net sales ratio
● Number of
environmentally
friendly products
● Customer satisfaction
level
● Amount invested
in intangible
assets
● R&D ratio
● Number of patents
● Total shareholder
return (TSR)
● Price earnings
ratio (PER)
● Minimized share
price volatility
● Energy usage
● Employee
engagement
● Lost-time injury
frequency rate
● Ratio of female
employees/Ratio of
female managers
● Free cash flows
● Net D/E ratio
● Sales:
¥900.0 billion
● Operating income:
¥75.0 billion
● Operating income
margin: 8%
● ROE: 8%
● ROIC: 6%
● Capital
expenditures:
¥280.0 billion/
5 years
● R&D expenses:
3%‒4％ of sales
● Payout ratio:
30%‒50%
● DOE of about 2.5%
set as a lower limit
for each period
(DOE: Dividend on
equity attributable to
owners of the parent)
● Share buybacks
(flexibly implemented)
● Scope 1 and 2 CO2
emissions: -50%
(compared with FY2017)
● Continue selection
for White 500
certification
● Net D/E ratio:
0.4 times or less
MTP2026 Targets
Main Reference Indicators
Management Tasks
Earnings per share
growth
Stable dividend
Lower cost of
capital
Growth capacity
Profitability
Appropriate
shareholder returns
Response to ESG
Sound fiscal
standing
Growth with
profitability
Enhancement
of managerial
resources
Manage with an
awareness of
capital cost
ESG
management
Maintain a stable
financial base
that supports
sustainable
growth
Showing how the NSK Group’s management tasks and
management strategies will lead to increased shareholder
value, the NSK financial logic tree is a diagram based on the
connections between the numerical targets of MTP2026 and
related indicators.
From a financial perspective, dividends and share price growth
form part of the factors that bring about increases in shareholder
value, and these outcomes can be verified using long-term TSR.
Because the share price generally fluctuates depending on the
level of the cost of capital, stably incorporating an appropriate
cost of capital into the market price should reduce the risk of
stock price fluctuations.
NSK has identified the stable return of profits to shareholders
as an important management policy. While the Company did
continue to provide stable dividends throughout the COVID-19
pandemic, its total stock return (TSR) performance over the past
10 years has been weak. As I mentioned earlier, NSK’s share
price has regrettably underperformed the TOPIX and TOPIX
Machinery indices. This is primarily due to the downturn in
profitability. With this in mind, expanding our TSR and
enhancing shareholder value by increasing earnings capabilities
and lifting ROE are of the utmost importance. Critical here is
the need to promote portfolio reforms to help drive growth
with profitability. Complementing these endeavors, we must
generate cash through such measures as the reduction of
shareholdings, utilizing the proceeds to enhance managerial
resources, invest in sustainable growth through ESG
management, and return profits to shareholders on a stable
and continuous basis.
In light of the growing importance of ESG in recent years, we
are incorporating management strategies and numerical targets
for advancing ESG management in the Company’s logic tree. We
believe that promoting ESG management and reducing capital
costs will lead to increased shareholder value. From a financial
perspective, we are also expanding our financing options related
to our sustainability strategy.
NSK Financial Logic Tree
Increase shareholder value
Dividend growth＋Rising stock price
NSK REPORT
2024
29
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Strengthening Internal Capital
04
Intellectual Capital -Strengthening Technological Capabilities-
NSK has relentlessly pursued innovative technologies and focused on improving quality to contribute to a safer, smoother society and to protect the global environment, in line with
its corporate philosophy. NSK leads the world in the product fields of bearings, automotive components, and precision machinery and parts. Its technological foundation consists of
tribology, materials, numerical simulation, and mechatronics, which are NSK’s Four Core Technologies, and manufacturing engineering, which gives them shape. Our goal is to be a
company that is needed, trusted, and relied upon by society. To this end, we will continue to contribute to the creation of a sustainable and more prosperous society and protect the global
environment by saving energy and reducing CO2 emissions while creating and supplying high-performance and highly functional products to the market in a timely manner.
NSK’s Four Core Technologies + Manufacturing Engineering
In the past, accuracy and reliability in
product development were achieved
with experience-based design
and longer testing periods. NSK’s
simulation technology allows virtual
validation to accelerate design and
production. Extreme conditions or
innovative designs that defy previous expectations can also be
evaluated and analyzed.
Giving Shape to Four Core
Technologies
Manufacturing
Engineering
Four Core Technologies + 1
Reproducing Phenomena in Virtual
Space and Predicting Performance
Numerical Simulation
Mechatronics integrates machine element
technology with control technology. By
combining bearings, ball screws, and linear
guides, together with motors, sensors, and computers, greater
mechanical functionality is elicited with computer control. This
technology enables new functions and performance in a range of
industrial machinery, automotive, and biomedicine applications. It
also contributes to greater reliability, as well as to convenience and
safety in daily life.
Technology That Supports People for
a Convenient, Safe, and Comfortable Future
Mechatronics
Tribology is the study of friction and
wear of contact surfaces in relative
motion, such as rotating parts that
endure enormous forces with a thin
oil film. Severe operating conditions
are mitigated through lubrication
and surface treatments, resulting in superior performance for
applications requiring low friction, high-speed rotation, quiet
operation, or enhanced durability.
Studying, Clarifying,
and Controlling Friction
Materials research and development
affects nearly every aspect of product
performance. We are constantly
pursuing cost and productivity while
meeting ever evolving demands
for improved functionality, durability, and reliability through
technologies that utilize metals, polymers, and ceramics
with optimized material composition and heat treatment
conditions.
Unrelenting Pursuit of Performance
Durability and Reliability
Tribology
Materials
Four
Core
Technologies
1
Friction on the bearing’s ball
surface
Active Caster
Cheonan Plant in South Korea
Contributing to the environment
and heightening safety and
security through our Four Core
Technologies requires something to
breathe life into these technologies.
In addition, it is essential to
consistently manufacture products
with high quality. NSK tackles
these issues by applying smart
technology to its equipment,
utilizing IoT, and optimizing
its overall production framework
while it works to realize the creation
of smart factories that economize on
space, save on energy, and reduce
labor requirements.
Bearings utilizing ceramics
and resins
Example of bearing grease
flow analysis
NSK REPORT
2024
30
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK attaches importance to its aim of contributing to
the development of a sustainable society and becoming
a company that is needed, trusted, and relied upon by
society through value creation by combining digital
technology with tribology technology, which is one of
our “Four Core Technologies Plus One.”
The technologies that hold the key to cracking this
tribology technology are materials, lubrication, and
mechanics technologies. We have been conducting
joint research in these three fields with the Tokyo
Institute of Technology
since 2020. Looking
to strengthen their
relationship and put
in place a system that
would enable continued
innovative research
and development,
NSK and the Tokyo
Institute of Technology
signed an agreement
for the establishment
of a tribology research
center in March 2023.
NSK Tribology Collaborative
Research Cluster
Outer ring
Lubricating
layer
Ball
Inner ring
Identifying the most suitable material
texture for each application to help realize
reliable, long-lasting products.
Materials technology
Reducing friction by using lubrication to
allow bearings to rotate smoothly.
Lubrication technology
Optimizing bearing design and
development by understanding the forces
acting on the surfaces that are in contact
when a bearing spins.
Mechanics technology
In December 2023, the NSK Tribology Collaborative
Research Cluster was established at the Tokyo
Institute of Technology’s Suzukakedai Campus.
By conducting research that integrates three fields
previously researched separately, the NSK Tribology
Collaborative Research Cluster will conduct research in
more depth and create groundbreaking solutions that
will lead to the creation of bearings and linear motion
products with enhanced performance. Through this
collaborative research center, researchers from NSK
and the Tokyo Institute of Technology will interact
closely with each other, and we will continually focus
on the development of human resources capable of
conducting high-caliber fundamental research.
Further Enhancing NSK’s Strengths through Open Innovation
Three fundamental tribology technologies: materials, lubrication, and mechanics
NSK is committed to NSK Digital Twin, which provides
new value to society by maximizing the use of digital
technology. NSK Digital Twin is a problem-solving
framework focused on enhancing the creativity of
engineers and is currently being rolled out to all engineers.
NSK Digital Twin digitally reproduces real phenomena,
giving a glimpse into their inner workings. It digitally
models such mechanisms to give an understanding of the
hidden essence of the phenomena. We plan to harness this
framework to create out-of-the-box solutions.
NSK Digital Twin is also being used to solve
problems with bearings during heat treatment
processes. After bearings have been treated in the
heat treatment furnace, the cooling process can result
in ring deformation, and such deformation needs to
be corrected in after process operations. To address
this problem, we developed a hypothesis about a
deformation mechanism caused by uneven cooling
and we digitally modeled the phenomenon inside the
heat treatment furnace. By understanding the essence
of the phenomenon through repeated insights into
the digital and real phenomenon, we were able to
implement effective
countermeasures
and made it possible
to realize improved
productivity and shorter
development times.
Using NSK Digital Twin to Create Out-of-the-Box Solutions
Heat treatment simulation
NSK REPORT
2024
31
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK provides “Kaizen Expert Training” for the purpose
of developing human resources to drive continuous
improvement production innovation (APS) activities.
We select members from production sites and, during
a one-year training period, we create opportunities for
them to use digital technology such as video analysis
software and data analysis software to implement
various improvement activities. This training has run
for five years to date. Through the improvement of
digital skills and development of the ability to work
as a team for the
realization of ultra-
stable production,
we are developing
next-generation
monozukuri
human resources
that will take on
the challenge of
“Change & Go
Beyond.”
failures and maintenance records, and manage the
database in an integrated manner globally. This is
helping us evaluate the soundness of facilities and
improve the efficiency of investments in upgrades
and overhauls. In addition, we are using AI to analyze
the cause of breakdowns and develop breakdown
predictions,
which will
be useful in
the future for
strengthening
maintenance
skills, including
transferring
knowledge and
skills.
PM-Ai is a facility management system that carefully
maintains and manages equipment to achieve a safe,
high quality, and efficient plant. Currently, we have
introduced PM-Ai at 15 plants in Japan and overseas.
We have created a database that includes history of
Simulating a manufacturing process means
using simulation software to digitally reproduce
the production conditions in a plant. We started
simulation activities in 2021, with members of
production management divisions and plants
working together to create models.
By simulating conditions that were previously
difficult to verify such as on-time delivery rates of
products, capacity utilization rates, labor savings,
and productivity, we are verifying the effects of
actions in advance. Going forward, we aim to use
simulation as tool that can inform management
decisions, for example, by simulating the effects of
the introduction of new equipment or the layout
for the construction of a new plant.
TOPIC
What is meant by simulating
a manufacturing process?
Strengthening Internal Capital
04
Manufacturing Capital
To enhance its managerial resources, NSK will utilize the power of IT and create a foundation that will continue to bring about business transformation under MTP2026. We will
proactively utilize digital technology in quality and monozukuri (manufacturing), as well as the development of the human resources that support them.
In manufacturing, we are promoting measures aimed at ultra-stable production, strengthening global production, and responding to the production of new products. Through these
measures, we will build a robust structure that is resilient to fluctuations in both demand and the times, which will in turn lead to sustainable growth. Our measures aimed at ultra-stable
production measures in particular embody our efforts to harness digital technology and take up the challenge of new monozukuri. Here, we will endeavor to establish production lines
that are always in operation and never produce defects while optimizing production to build production sites that better address customers’ needs. NSK will continue to pursue new
manufacturing methods to achieve higher quality with a 50% increase in productivity.
Combining the Power of People and Digital Technology to Build Plants That Can Adapt to a Changing World and Meet Diverse Customer Needs
Developing the Next Generation of Monozukuri
Human Resources
Kaizen Expert Training
Harnessing Digital Technology to Maximize the
Value of People and Facilities
Using PM-Ai to achieve smart facility
maintenance at plants
Efforts to optimize production
We are conducting simulations of production processes
and establishing a centralized management system for
global facility capacity.
Efforts to enhance management through
remote monitoring
NSK is taking on new challenges in the manufacturing
field, including a system to visualize the operating
status of equipment and product quality.
We aim to improve quality and productivity; realize
safer, more secure, and more environmentally friendly
plants; and increase vigor and enthusiasm among
employees at manufacturing facilities.
Database creation and facility management
using PM-Ai
NSK REPORT
2024
32
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Expanding Our Global Business Network
The
Americas
10
Japan
20
Europe
11
Asia
26
Europe
3,338
Japan
10,474
The Americas
18%
The Americas
18%
18%
18%
Europe
14%
Europe
14%
14%
14%
China
20%
China
20%
20%
20%
Other Asia
14%
Other Asia
14%
14%
14%
Asia
9,690
The
Americas
2,130
Japan
34%
Japan
34%
34%
34%
billion
¥ 788.9
Sales
25,632
Number
of employees
NSK maintains more than 200 business locations in 31 countries and regions. (As of March 31, 2024)
We promote production in optimal locations by utilizing our 67 production sites spread around the world.
NSK was one of the first Japanese manufacturing
companies to expand its business outside Japan. After
launching overseas exports in 1948, we began overseas
production in countries such as Brazil, the United
States, and the United Kingdom in the 1970s, laying the
foundation for our global business by manufacturing
products locally. From the 1980s onward, we expanded
our production lineup, primarily for the electric and
automobile industries, and in the 1990s, we established
production sites in various Asian countries, including
China, against the backdrop of economic growth in
emerging economies. Since then, we have expanded
our business in emerging companies and established
business relationships with a wide range of customers
in Japan and overseas, and put forward supply
proposals from optimal locations using our global
production sites.
Production in Optimal Locations Utilizing Our
Global Supply Capabilities
Sales by Region (based on customer location)/
Number of Employees by Region (consolidated) （FY2023）
(March 31, 2024)
More than 200 business
locations in 31 countries
and regions,
including 67 production sites
Production
Sites
Headquarters
Sales
Sites
R&D
Centers
Note: The number of locations includes
equity-method affiliates.
NSK REPORT
2024
33
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Strengthening Internal Capital
04
Human Capital
We will create a culture in which ongoing
future-oriented challenge is encouraged,
to make the most of our diverse talent
Hidenori Oka
Executive Officer, Senior Vice President,
Head of Human Resources & General Affairs
Division HQ
Please see our
website for more
information. ▶
The NSK Group’s human resources strategy and related
initiatives have always been closely interwoven with its
management and business strategies. Accordingly, in
our Mid-Term Management Plan 2026 (MTP2026), we
set the objective of maximizing the value of our human
capital to achieve our management goal of enhancing
managerial resources. With our sights set five and
10 years into the future, we are pushing forward
with a range of initiatives to achieve three goals of
becoming a company that attracts diverse human
resources, enables these diverse human resources
to develop and grow their skills and abilities, and
provides safe and healthy workplaces. As we pursue this
approach to human capital management, I recognize
the importance of communicating our approach to
human capital management to our employees and
have focused my efforts accordingly. For this reason, I
The NSK Group aims to foster employees who are
able to create new value in a sustainable manner by
proactively challenging difficult, future-oriented goals,
and who constantly adapt and evolve their skill set
accordingly. Setting goals from a high vantage point,
backcasting, independent thinking, and taking on new
challenges constitute the mindset required to Change
& Go Beyond. As a mechanism to support and empower
employees who proactively tackle new challenges,
in FY2024 we marked a step forward by introducing
a new personnel system for managerial positions.
This new system clearly defines the skills required for
each position and documents the expected roles and
responsibilities. We have already defined departmental
duties and the division of duties for each role, and
managerial-level employees work with their reporting
manager to agree on individual goals and objectives.
We also plan to disclose all role descriptions internally
in the future to help employees envision and map out
their own career paths. This approach will also enable
a “pay for position” system that places emphasis on the
responsibility and size of the role in question.
To Change & Go Beyond, each employee must take
the next step and move outside of their comfort zone.
For example, I would encourage our employees to
constantly work to reduce the time they spend on
routine tasks and use the extra time to tackle new
initiatives. Accordingly, our management team must
lead from the front in doing this in order to remind
employees of the importance of this mindset, and build
have placed an emphasis on clarifying and discussing
our goals, and we have created opportunities to
communicate our human capital strategy with our
employees via in-house publications and training.
These three goals form the core of our human resources
strategies in each region around the globe. To share
initiatives toward these goals from each of our regions
around the world, we hold global human resources
meetings twice a year, providing mutual feedback and
discussion, and cooperating on global projects.
a workplace environment where new challenges are
celebrated and commended.
NSK’s Approach to Human Capital
Management
Building an Environment Conducive to
New Challenges
One of the reasons the NSK Group has successfully
grown over the past 100 years is that as a BtoB product
supplier we have a history of reliably giving shape to
the requests of our industry-leading customers. Going
forward, we will strive to build on our past successes,
which have been achieved through inspiration from
both within the Company and externally and use
these experiences to help shape our future. We have
positioned diversity as a key driver of our human
resources policies, and our aim is to build a company
where a diverse range of people can come together,
inspire each other and continue to grow while creating
positive synergies, thereby maximizing the value of our
human capital.
Another concept that we have included in our approach to
“growth with profitability,” one of the pillars of MTP2026,
is Bearings & Beyond. As one means of achieving
this growth, we are working to expand the Condition
Monitoring Systems (CMS) business and are hiring
highly specialized personnel from outside the Group
in conjunction with this management goal. In areas
that are new to the NSK Group, we will pair the fresh
perspectives of personnel with knowledge and experience
from outside the Group with the internal knowledge
and technology established by NSK over the years. This
will drive a chemical reaction that will enable us to set
the future in motion, as well as provide opportunities
for our employees to achieve personal growth. To make
this possible, we are developing a personnel system that
enables us to hire and properly evaluate the contribution
of highly specialized personnel, creating an environment
that allows them to excel.
We must also foster a corporate culture that allows
diverse human resources to play an active role. On
the occasion of our 100th anniversary in 2016, we
established NSK Vision 2026, and launched a range
Diversity as a Driving Force of the
Organization
NSK REPORT
2024
34
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
of initiatives to share the direction NSK is aiming
toward as a global company with a multilingual and
multicultural employee base. Having recognized that
sharing our Vision and establishing psychological
safety are the keys to making the most of this diversity,
as part of our Vision 2026 Promotion Activities we
revised workshops that were originally developed for
the Company’s executive officers to provide content
suited to each level of the organization and specific
workplace environments, such as the production, sales,
technology, and administrative divisions. A corporate
culture is not something that can be developed by
initiatives over the course of a year, but a goal we must
remain committed to over the long term, by constantly
improving our approach and adding new perspectives
and measures.
This is why I believe it is important to foster both a
conducive environment and the personal will to be able
to seize the diverse opportunities that are offered.
As a means of achieving this goal, we have introduced
a job rotation system that allows our younger
employees to build a broad range of experience and
hone their perceptive skills by experiencing three
different departments within a 10-year period. We have
also begun studying a new mentor system. Because
employees gain insight and inspiration by interacting
with others from different divisions, even within the
same company, having different types of employees
from across the scope of divisions and departments
support younger employees as mentors can provide
valuable opportunities for growth.
We will steadily drive these kinds of workplace-
focused initiatives so that each member of our diverse
group of employees can make the most of their
individuality, as well as expand their potential and
continue to grow by taking on new challenges.
We conduct regular engagement surveys as a means
of collecting feedback from our employees, and work
to link this feedback to concrete action. Although
scores in Japan for questions related to NSK Vision
2026 and diversity have steadily risen, I feel that the
lower scores for strategy and employee benefits are a
challenge in that they show we have yet to reach our
employees regarding the details of these areas. As a
solution, we will increase opportunities to directly
respond to questions presented by employees during
town hall meetings with our CEO and during financial
results briefings for employees hosted by members
of our top management. In addition, we will work
to communicate and promote the use of our family
care leave, parental leave, and other systems via the
digital signage* screens at our plants. I believe steadily
pursuing these types of efforts on an ongoing basis is
the key to further improvements.
Another priority task is employee job satisfaction
and motivation. In this respect, I believe that we must
delegate authority to our employees and allow them
to experience new challenges in order to enhance job
satisfaction. In doing so, it is essential the those around
them fully support them in their challenges. Any
mistakes they make will serve as learning experiences
for the future, and I am sure they will have countless
opportunities to put them to good use. Looking back
over my own career, I feel that making mistakes and
applying lessons learned ultimately helped me grow.
Respecting the Individuality and
Potential of Every Employee
Toward a company that is needed, trusted, and contributes to a sustainable society
We aim to be a needed and trusted company that
contributes to the development of a sustainable society
by creating new value through the fusion of tribology
and digital technology.
Human Resources Policy
We believe each of our employees is a priceless asset
and have clearly stated in the NSK Group Management
Principles that our aim is to “provide challenges and
opportunities to our employees, utilizing their skills
and encouraging their creativity and individuality.”
Human Resources Strategy
We have committed ourselves to creating a
“fair workplace that empowers the individual.”
This commitment features three key areas of
focus: leveraging a diverse workforce, building
more engaging workplaces, and providing
opportunities for growth.
Linked
Change & Go
Beyond
ESG
Management
Enhancement of Managerial Resources
Growth with
Profitability
Maximize the Value of Our Human Capital
Create an environment in which each and every one of our diverse human resources can make the most of their
individuality, expand their potential by taking on challenges, and continue to grow.
Our Vision
A company where diverse human resources
can develop and grow their skills and abilities
(personnel system, education/training system, work style)
A company that attracts
diverse human resources
(Diversity, Equity & Inclusion)
1
2
Safe and healthy workplaces
(corporate health and wellness, safety)
3
Management Strategy
(Mid-Term Management Plan MTP2026)
Human Resources Strategy
(Mid-Term Management Plan MTP2026)
NSK’s Goal for Human Capital Management
* An internal communication system in which information is conveyed to
employees via large digital monitors installed in cafeterias and break
rooms at plants and technology divisions.
NSK REPORT
2024
35
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
In Japan, we took the step of designing a career development program that consistently produces a strong talent pool
of future management candidates. The program itself begins with job rotations intended to nurture young employees
as an early-career development measure and includes the NSK Management College, which we administer to provide
training to select individuals at the assistant manager and manager levels. Similarly, we conduct region-specific training
programs for human resources outside of Japan. In addition,
we run a global management college that is primarily
intended for successors for those in global posts
Glossary as a
global initiative.
Regarding appointments to key management positions,
the Human Resources Committee serves as the top-level
body that approves succession plans for management
personnel and human resources investment plans. To expand
the management successor talent pool, we hold regular
discussions between each business division and functional
division, and implement cross-business and cross-divisional
rotations and promotions for selected employees (stretch
assignments). Similarly, we hold successor planning meetings
on a regular basis for global posts and regional core posts
in Europe, the Americas, and China. We are committed to
globally coordinated succession management that accepts
all ages, genders, and nationalities in an effort that begins by
clearly defining the key posts (talent profiles).
Goals for Development of Management Candidates
Incumbent
Successor
Candidates
Human Resources for
Appointment to Key Posts
Human Resources in Respective Divisions
Rotation of Young
Employees with
Management Potential
Career
Seminars
NSK Management
College, Assistant
Manager Course
Global Posts
Regional Core Posts
Human Resource
Pool for Key Posts
NSK Management
College, Manager
Course
Selected External
Training
NSK Global
Management
College
Human Resources Committee
Overseas Regions
Overseas Regions
Strengthen
Collaboration
on Key Posts
Outside Japan
Human Resources
Outside Japan
Recognized
by all
Quality of
relationship
Level 1
Everyone
understands the
value of working on a
new movement and is
excited about it.
Phase 4
Realization
FY2025‒2026
Phase 2
Establishing
as culture
FY2019‒2021
Phase 3
Further
refinement
FY2022
Phase 3
Further
refinement
FY2023
Phase 3
Further
refinement
FY2024
Phase 1
Understanding
and ownership
FY2016‒2018
Everyone has a
clear understanding
of the vision and
actions are taken
proactively.
Exploration
Quality of
thinking
Level 2
Everyone is
sharing their
wisdom and
working on the
vision.
Trial-and-
error
Quality of
action
Level 3
Everyone is
taking the results
positively and
refining their
efforts.
Everyone is proud
of our actions based
on our vision for our
customers and
society.
Everyone’s
actions to
realize the vision
have become
common sense.
Human Capital
Strengthening Internal Capital
04
Developing Future Management Candidates
Introducing a New Personnel System
The way people approach their careers is diversifying,
with a greater desire for a self-driven career path. The
correlation between personal growth, self-realization,
and corporate growth is becoming stronger, and the
relationship between employees and companies is
becoming more equal, with employees having a greater
say in how they shape their careers. In response to
these changes, our first move has been to introduce a
role-based personnel system for managerial positions.
Role-based personnel systems clearly define the roles
and responsibilities of each employee, and expect
individuals to take the initiative on attempting to
achieve lofty, future-oriented goals. These systems also
clearly define talent profiles for specific positions in the
form of role descriptions, which enable employees to
envision and map out their own career path and take
self-driven steps toward their personal growth.
Vision 2026 Promotion Activities
Since FY2016, we have engaged in various initiatives that seek to achieve
our goal of setting the future in motion under NSK Vision 2026, both in
Japan and abroad. As the backbone that supports all of NSK’s human capital,
these initiatives aim to foster a corporate culture in which active dialogue
and psychological safety within the workplace serve as the foundation for
encouraging employees to bring their personal vision and sense of purpose to
fruition, leading to actions that will set the future in motion. To help support
departments and individuals in their efforts to set the future in motion, specific
initiatives we have conducted since FY2023 include an action learning program
in which the members of each workplace discuss topics such as their personal
visions over a series of sessions, as well as publishing a selection of “how-to”
guides filled with tips on how to translate the learning from previous activities
into real action. We also share and discuss these kinds of initiatives from each
region at the Global Vision 2026 Committee Meeting, which we held in-person
for the first time in five years in April 2024.
Examples of Initiatives
NSK REPORT
2024
36
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
* The survey is conducted every two years in multiple regions,
with the regions conducting the survey differing from year
to year. Scores are calculated by combining the FY2022 and
FY2023 survey results, and applying a weighted average based
on the number of surveyed persons.
Maximize the
value of our
human capital
FY2023
(actual)
69
FY2026
(target)
70
Global
engagement
score*
Diversity & Inclusion
By continuously engaging in initiatives that help advance
the career of women̶one of our key management
issues̶we have made steady progress on increasing
the number of women in managerial positions and in
the managerial candidate class to 100, our target for
FY2024 in the action plan we formulated in accordance
with the Act on Promotion of Women’s Participation and
Advancement in the Workplace. As part of this effort, in
Japan we distributed educational pamphlets on women’s
health and held seminars to which we invited role
models for women during International Women’s Day on
March 8, 2024. Abroad, NSK Europe and NSK Americas
jointly held an internal online event covering the topics
of unconscious bias and career advancement for women.
In a similar vein, we have sought to assist employees
from various backgrounds in playing an active role by
providing systems that help them balance work with
child and family care, and in most cases these systems go
beyond the legal mandated minimums. For example, we
provide training programs specifically designed for those
taking childcare leave so that this period does not leave a
gap in their careers, but instead serves as an opportunity
for them to prepare to advance their careers while
caring for their children. Similarly, we organize support
seminars on different family care‒related topics that go
beyond the basics to assist employees in their struggles
with balancing care for family members with their work.
In fact, we release videos of the seminars that can be
viewed by both employees and their families.
We also engage in Diversity & Inclusion activities
targeting non-Japanese employees and LGBTQ+ in an
effort to promote a better understanding of
and empathy with hidden forms of diversity.
In 2023, we received the Gold award for
the third consecutive year under the PRIDE
Index in recognition of our various activities
to empower the LGBTQ+ community.
Maximizing the Value of Our Human Capital: Key Metrics and Targets
We have laid out KPIs and FY2026 targets for each of our initiatives intended to achieve our three goals for human capital management. We believe that our aim of maximizing the value
of our human capital can be achieved by accumulating the results of each of these initiatives, and we have positioned the global employee engagement score obtained from this survey as
a composite measure of our performance.
Here, we would like to introduce several initiatives from the larger scope that are particularly strongly correlated to our three goals for human capital management.
Flyer for a support seminar
video on the topic of balancing
work and family care
Cover page for women's
self-care health support
pamphlet
Key Issues and Initiatives
Key Metrics
Scope*1
FY2023 Results
FY2026 Target
● Promoting Diversity, Equity & Inclusion
(creating an organization and culture that is
inclusive of diverse human resources/values)
● Employee diversity ratio (gender,
mid-career hires, nationality)*2*3
Japan
29%
35%
A company that
attracts diverse
human resources
● Support for balancing work and personal life
(e.g., childcare, family care, medical treatment)
● Percentage of male employees taking
childcare leave*3*4
Japan
83.3%
Maintain at 85% or higher
(FY2025)
A company where
diverse human
resources can
develop and grow
their skills and
abilities
● Introduction/operation of a new personnel
system
● Introduction/operation of role-based
personnel system (managerial level)
Japan
Formulated a system and
conducted briefings to
promote an understanding
(managerial positions)
Promote understanding
of system and improve
operations
● Promoting succession planning
● Localization rate for key global posts
Global
72%
Maintain at 70% or higher
● Developing digital human resources
● Number of participants in basic digital
talent development program*5
Japan
Approx. 4,000
● Deploy and instill
Company-wide
● Develop specialists
through practical training
● Number of participants in intermediate
digital talent development program*5
Approx. 1,100
● Corporate health and wellness
● Certification as Outstanding Health & Productivity
Management Organization (White 500)
Japan
Certification
Maintain certification
Safe and healthy
workplaces
● Fostering a “look across” culture of
mutual safety awareness in workplaces
● Lost-time injury frequency rate
Global
0.24
0.10
*1 Includes some Group companies unless otherwise indicated. *2 Diversity is emphasized at the decision-making level. The ratio is the percentage of diversity at the management
and staff levels (equivalent to career-track positions). *3 Scope: NSK Ltd. *4 Calculated based on the Company’s standard (leave taken within one year from the date of birth).
*5 Total number of participants for each program in FY2022 and FY2023.
NSK REPORT
2024
37
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
SDGs Declaration
In line with our Mission Statement, NSK will work to resolve societal issues by
conducting sincere and responsible business operations and achieving innovation in its
products and services, in order to help realize a sustainable society. We will uphold the
spirit of all 17 SDGs, and have selected seven goals that are particularly interlinked with
our business, which we will place priority on tackling.
NSK’s Seven Key SDGs
NSK has developed an edible oil deterioration control filter
by combining paper with additives used to prevent the
oxidative deterioration of oil. As this filter helps prevent
edible oil deterioration, it allows oil to be used more times
before disposal (saving resources). This, in turn, is expected to reduce the amount
of used edible oil that ends up polluting rivers and oceans. The product is currently
being sold to customers.
Utilizing our material technology, we are slowing the
deterioration of oil used for frying foods, while helping
to protect river and ocean environments.
NSK Product Making an SDG Contribution (SDG Story)
TOPIC
Technological
Development
NSK innovation is contributing to the
effective use of food oil and the conservation
of rivers and oceans
NSK’s Contribution
Solution Method
Promoting resource
recycling and reuse
Social Issue
● Destruction of the natural
environments, including
river and ocean pollution
Contributing with
material technologies
Sustainability Initiatives
05
Sustainability Management
NSK contributes to a safer, smoother society and helps protect the global environment
through its innovative technology integrating Motion & Control™. As a truly
international enterprise, we are working across national boundaries to improve
relationships between people throughout the world. Under this Mission Statement,
we are committed to:
NSK has formulated an SDGs Declaration and has selected seven key goals that are
particularly interlinked with its business, in order to help achieve the SDGs by creating
collaborative value with stakeholders. While keeping these seven key goals in mind, the
Company has drawn up NSK’s SDGs Declaration to clarify its strategic initiatives.
Sustainability Management
SDGs Declaration
■Provide our customers with innovative and responsive solutions through our world
leading technologies.
■Provide challenges and opportunities to our employees, utilizing their skills and
encouraging their creativity and individuality.
■Identify the needs of the present and future, and meet these needs by being flexible,
agile, and dynamic.
■Contribute to the communities in which we operate.
■Manage our business from an international perspective and develop a strong presence
throughout the world.
With these Management Principles, NSK strives to balance contributing to solutions for
social issues with achieving sustainable growth.
Furthermore, the Mid-Term Management Plan 2026 (MTP2026), which runs through
FY2026, has been positioned as a period for rebuilding the corporate foundation to enable
sustainable growth. By addressing three management challenges, namely “Growth with
Profitability,” “Enhancement of Managerial Resources,” and “ESG Management,” NSK
aims to be a company that is needed, trusted, and relied upon by society.
NSK has designated “safety, quality, environment, and compliance” as core values that
serve as a common standard of priority values for decision-making and actions taken by
management.
We have established the Core Values Committee, comprising the president and the
relevant directors. To advance NSK’s sustainability initiatives, the Committee sets
company-wide issues, makes recommendations for their resolution, and monitors
progress through policy discussions on the promotion and strengthening of core values
and the sharing of related risks. ▶ P.61 NSK’s Corporate Governance Structure
Promotion Structure
Please see our
website for more
information. ▶
NSK REPORT
2024
38
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
In the event that a workplace incident occurs at an
NSK Group site, the information is shared on the
Company’s intranet for all business sites worldwide
to view. Reenactment videos are created to provide
detailed insights into the incident. This encourages
employees to look across the incident and reflect on
whether similar operations or situations exist in their
own workplace.
By sharing past workplace incidents across
the organization, NSK is working to prevent the
recurrence of incidents, heighten safety awareness,
and further promote the creation of a safe, secure, and
comfortable working environment.
The NSK Group has established facilities called “Safety Dojo” at all production sites, where
employees receive training using simulators to experience potential workplace hazards. In
these dojos, employees learn the importance of prioritizing safety by recognizing the risks
of hazardous tasks by learning from actual
workplace incidents that have occurred
within the NSK Group, while being trained
to follow correct operating procedures. All
plant employees receive regular, annual
training at the Safety Dojo. VR (virtual
reality) content has also been incorporated
into the curriculum, allowing participants
to simulate experiences such as working at
heights and dealing with fire hazards.
At NSK’s production sites, we conduct risk assessments of equipment and machinery,
continuously implementing measures to reduce workplace hazards, particularly those
deemed high-risk. To enhance safety, risk
assessments are also conducted from the
development stage for new equipment and
processes. Currently, we are training safety
assessors who have obtained qualification
certifications from external institutions,
ensuring that personnel with the proper
knowledge and skills are taking action to
mitigate risks.
As of the end of FY2022, NSK had a total
of 991 safety assessors (245 in engineering,
NSK Group’s Safety Philosophy
Safety takes precedence over everything else
Creating a safe, secure, and comfortable workplace
Sustainability Initiatives
05
Safety Management
The NSK Group positions safety as one of its core values, a common value standard that
is given the highest priority in management decisions and actions. We are pursuing a
number of initiatives to ensure the safety of each and every employee and to enable all
employees to act safely based on our safety philosophy.
422 at production sites, and 324 in Group companies). We aim to increase the number
of certified safety assessors within the Company.
As a result of these initiatives, the total number of workplace incidents across the
entire NSK Group has decreased each year, and the number of incidents has been halved
compared to when these initiatives first began. ▶ P.74 Non-Financial Highlights
NSK’s Approach
Each of NSK’s sites has obtained external certification for ISO 45001, the international
standard for safety and health management systems. We are not satisfied with the
status quo and are constantly striving to improve our activities to enhance the level of
safety. NSK believes that the effectiveness of its management system can be enhanced
by having all of its plants ISO 45001 certified and regularly audited by a third-party
organization.
Acquisition of Health and Safety Management System Certification
Safety Dojo
Risk Assessment
Sharing Examples of Workplace Incidents
In-house training to improve the risk assessment skills
of certified personnel
VR safety training at the safety dojo
Frame captured from a workplace
incident reenactment video
Please see our
website for more
information. ▶
NSK REPORT
2024
39
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
We believe that quality education should be learned in the order of awareness →
knowledge → technique/skill.
To eliminate defects caused by human error, we have established Quality-Dojos at
52 production sites worldwide. In these dojos, we foster
awareness by explaining the importance of quality,
while hands-on experience with actual products and
defective items helps employees gain knowledge about
products and quality. At NSK, it is our goal for employees
working in production and technical departments to
participate in Quality-Dojo training at least twice a year.
By connecting what they learn to their daily work, these
employees become valuable contributors to high-quality
manufacturing, helping NSK achieve No. 1 in Total
Quality.
Examples
of
Initiatives
● Briefing sessions by the Global Quality Audit Office on activity policies
● Ascertaining and visualizing the current status of supplier quality and
providing monthly reports on quality issues
● Quality improvement activities implemented by the top management of
the Quality Assurance Division Headquarters for key suppliers
● Development of a management system for supplier quality problems
● Ascertaining the current situation at suppliers performing final processing
Sustainability Initiatives
05
Quality Management
With quality as one of its core values, the NSK Group aims to become “No. 1 in Total
Quality.” In other words, we are working to achieve the industry’s best quality in everything
we deliver̶not only products and services but also information. We believe that this
commitment to quality ensures that our products will satisfy customers all over the world.
To achieve our Quality Assurance Vision 2026 (100% good products and services that
put the customer first), we engage in activities based on the Three Pillars of NSK Quality
Assurance.
To verify that suppliers can systematically address quality issues, we conduct quality
management system audits. These audits are planned and carried out annually, not only for
new suppliers but also for existing ones, based on past audit results and quality histories.
NSK’s Approach
Please see our
website for more
information. ▶
1.NSK Product
Development System
(NPDS)
To quickly transform new orders into
reliable, stable production, we promote
initiatives that incorporate quality into
individual processes.
2.NSK Quality No. 1
(NQ1) Program
We work hard to realize stable production
and ensure zero defects.
3.Human Resource
Development
We promote human resource development
to build a stronger foundation for quality
systems.
Three Pillars of NSK
Quality Assurance
The NSK Group has obtained ISO 9001 and IATF 16949 certifications, the international
standards for quality management systems, at its development, design, and
manufacturing facilities around the world. In addition, the effectiveness of our quality
management system is verified through periodic third-party and internal audits, and
when problems are found, appropriate corrective measures are taken to continually
improve the level of our efforts.
The NSK Group provides tiered quality education tailored to each position, from new
employees to management, to continuously enhance awareness and knowledge. In
addition, all employees undergo annual e-learning courses, while production sites
conduct hands-on Quality-Dojo training with actual products.
Quality Management System
Quality Training
High-quality parts, materials, and lubricants are required to manufacture high-quality
products. At the NSK Group, we engage in a wide range of initiatives to enhance quality,
based on our strong ties with suppliers.
The Quality Assurance Division Headquarters engages in activities to improve quality
while collaborating with plants that receive products from suppliers, comes up with
plans to fix issues each month based on quality data, and uses a system for managing
quality at suppliers.
Initiatives to Enhance Supplier Quality
Quality-Dojo* Training
Quality-Dojo Training: On-Site
* Teachers and assistant instructors will be appointed to all Quality-Dojos
to manage them comprehensively, ensuring the enhancement and
renewal of educational content to the training of instructors and the
formulation of educational curricula.
NSK REPORT
2024
40
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Every year, the NSK Group holds procurement policy briefings to communicate to major
suppliers on information about heightened social demands, such as human rights,
labor practices, and climate change countermeasures. We also explain initiatives that
NSK expects suppliers to take, such as improving occupational safety and reducing
CO2 emissions, while calling for coordinated efforts across the entire supply chain. In
May 2024, 87 companies
participated in procurement
policy briefings.
In FY2023, we distributed a
video about the NSK Human
Rights Policy and related
initiatives to some suppliers,
and collected their opinions,
impressions, and other
feedback.
The NSK Group collaborates with approximately 1,500 direct material suppliers globally
(adjusted for overlaps between regions).
Ratio of NSK Group Suppliers by Region (Number of Suppliers)
Japan
1,500 suppliers
(as of March 2024)
34%
Other
Asian countries
27%
China
13%
Europe
13%
Americas
13％
Approximately
Sustainability Initiatives
05
Supply Chain Management
NSK’s business is supported by many suppliers. NSK considers its suppliers to be
indispensable business partners and aims for mutual development while building
relationships of trust. Based on our basic philosophy of conducting fair and impartial
procurement activities that are considerate of impacts on both society and the
environment, we are engaged in efforts throughout our entire supply chain to help
create a sustainable society.
NSK’s Approach
Sharing NSK’s Value Creation with Suppliers
Breakdown of the Supply Chain
The NSK Group ensures that the parts and raw materials it procures, as well as the
efforts of its suppliers, satisfy NSK’s standards for quality, cost, and delivery (QCD). We
require suppliers to understand and agree to the NSK Supplier CSR Guidelines and the
NSK Group Green Procurement Standards. In addition, we strengthen risk management
by incorporating environment, social, and governance (ESG) clauses into our basic
business agreements.
Supply Chain Risk Management
Note: Adjusted for overlaps between regions.
Procurement policy briefing
As a policy, NSK prohibits the use of conflict minerals*1 in its products. Conflict minerals
are those that come from the Democratic Republic of the Congo and its neighboring
countries, which can be the source of funding and benefits to illegal armed groups that
violate human rights. Moreover, whenever investigation reveals concerns about conflict
minerals in the supply chain, we inform relevant suppliers of the importance of addressing
this issue and take measures to prevent the use of the relevant parts or raw materials.
Some NSK products, including electronic components used in vehicle electric power
steering systems, contain metals such as tin and tantalum, which are subject to U.S.
conflict minerals regulations*2. For this reason, NSK conducts annual conflict mineral
surveys in cooperation with relevant parts and raw material suppliers. This includes
tracing relevant materials back through the supply chain to the refineries and countries of
origin. We evaluate the safety of mineral procurement using the CMRT and EMRT unified
formats developed by the Responsible Minerals Initiative (RMI), an organization leading
global efforts to avoid conflict minerals. Our investigations have not identified the use of
any conflict minerals that could serve as a source of funds for armed groups.
Addressing Conflict Minerals Regulations
*1 Conflict minerals are defined as tantalum, tin, gold, and tungsten under the U.S. Dodd-Frank Act.
*2 U.S. regulations require companies listed in the U.S. to investigate the potential use of conflict minerals in products,
and to officially submit the results and publicly disclose them every year. Although NSK is not listed in the U.S. where
the regulations apply, the Company still conducts conflict mineral surveys and shares this information with customers.
Please see our
website for more
information. ▶
NSK REPORT
2024
41
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Climate Change Countermeasures
Environmental Action Plan
NSK Environmental Policy and Environmental
Code of Conduct
Please see our
website for more
information. ▶
Please see our
website for more
information. ▶
● Thermal insulation coatings on roofs
● Reduction of air leaks in production
equipment
● Adoption of high-efficiency
machinery
● Compressor energy saving
Key Themes Discussed in FY2023
Structure for Promoting Carbon Neutrality
NSK considers initiatives toward carbon neutrality as an essential management issue to
solve social challenges, ensure business continuity, and achieve sustainable growth. The
Carbon Neutrality Department sets policies, strategies, and targets from a companywide
and mid- to long-term perspective, promoting various measures to achieve goals. Progress
is regularly reported to the executive officer in charge and the CEO. Particularly critical
measures are decided by the CEO following discussions by the Operating Committee
and are deliberated by the Board of Directors. The Board of Directors supervises the
implementation of these initiatives. The degree of achievement of targets to reduce CO2
emissions is incorporated into the evaluation criteria for the short-term performance-based
compensation of executive officers. Under this system, initiatives are advanced across the
Company in collaboration with various departments through expert committees.
NSK has established the Environmental Action Plan to promote ESG management, one
of the key issues of MTP2026. Based on our global environmental management and
environmental compliance, we set a “carbon-neutral society,” a “material-cycle society,”
and an “environmentally symbiotic society,” as our vision, and we are promoting
activities that aim to fulfill our role through minimizing the environmental footprint of
our business activities and maximizing our contribution to the environment with our
products. This is also linked to helping to achieve the SDGs.
Climate change, resource depletion, air and water pollution caused by chemicals,
and the loss of biodiversity are increasing concerns on a global scale, and represent a
collective challenge for humanity to realize a sustainable society that develops while
preserving the global environment. NSK has formulated the NSK Environmental Policy
and is committed to developing products and services that contribute to reducing
environmental impact. In addition, NSK operates its business with the goal of reducing
environmental burdens throughout the value chain, striving to achieve the preservation
of the global environment as outlined in the NSK Mission Statement.
The Energy Conservation Subcommittee
formulates a road map to achieve carbon
neutrality, and shares energy usage, CO2
emissions, and measures, such as the expansion
of energy conservation and renewable energy use
at each plant. The subcommittee works to reduce
energy consumption across the NSK Group.
Energy Conservation Subcommittee
As overseas sites account for about half of NSK’s energy consumption, collaboration
with environmental managers at each regional headquarters is being strengthened to
share energy-saving initiatives and discuss challenges.
Collaboration with Overseas Sites
Led by the Technology Division, the Environmental Product Subcommittee creates
environmentally friendly products and services, establishing a framework to
quantitatively assess their environmental performance. Based on this, we aim to provide
products and services with superior environmental performance, contributing to overall
reduction of CO2 emissions in society.
Environmental Product Subcommittee
To ensure all employees can engage in their duties with accurate knowledge, NSK
conducts several themed environmental e-learning sessions annually, along with
goal-specific training and awareness activities for environmental managers in each
department. In addition, tiered education programs and general environmental training
for new employees are continuously implemented to enhance the effectiveness of
environmental conservation activities.
Development of Environmental Personnel
Environmental compliance
Global environmental management
All areas and divisions of NSK Group business activities
Long-term
guidelines
Contributing to the establishment of
a carbon-neutral society
Contributing to the establishment of
a sound material-cycle society
Contributing to the establishment of
an environmentally symbiotic society
Contribute to the realization of a sustainable society,
contribute to the SDGs, grow as a sustainable company
Efforts at the
“utilizing”
stage
－Maximizing the environmental
contribution of products－
Efforts in the
“creating”
activities
－Minimizing the
environmental
impact of
business
activities－
Reduction of CO2 through
environmentally friendly products
● Base performance improvement
● Contribute to energy
diversification applications
Effective use of resources through
lightweight, long-life design of products
Reduction of environmentally
harmful substances in products
Products guaranteed free of
environmentally harmful substances
● Establishment of assurance system
● Promotion of green procurement
Reduction of CO2 emissions
from business activities
● Technological innovation
Increasing production capacity of existing facilities,
implementing thorough energy conservation
measures, making energy consumption visible,
increasing logistics and business efficiency
● Utilization of renewable energy
● Reduction of emissions during
manufacturing through product design
Waste management
● Promotion of the 3Rs (Reduce, Reuse, Recycle)
Effective use of water resources
● Applying cyclic use, switching to air cooling
Effective use of steel and other resources
● Improving efficiency through existing
technology, upgrading tools and dies
● Practical applications of new processing
technology and innovative technology
Biodiversity conservation
● Promotion of social
contribution activities
Reduction of environmentally harmful
substances used in manufacturing
● Reduction of VOCs and
PRTR-designated substances
Preventing environmental pollution
● Repair of buried underground tanks
Sustainability Initiatives
05
Environmental Management
NSK REPORT
2024
42
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK’s Approach: Promoting CO2 Emission Reductions through Our “Create” and “Utilize” Approach
In response to the urgent issue of climate change, NSK contributes to achieving carbon neutrality across the entire supply chain. NSK works to reduce CO2 emissions not only during the
“create” stage, when products are manufactured, but also throughout the entire product life cycle, including the “utilize” stage by customers. The products NSK provides help reduce
energy consumption by controlling friction and, furthermore, contribute to the efficient use of resources by incorporating the concept of a circular economy. By leveraging its core
technologies, honed over more than 100 years, NSK is dedicated to contributing to the realization of a sustainable society.
NSK contributes to the
reduction of overall CO2
emissions in society by
providing environmentally
friendly products.
NSK promotes initiatives
to minimize CO2 emissions
in the manufacturing
process.
Reduction of CO2
Emissions from
Business Activities
Environmental
Contributions
through Products
Initiatives for Minimizing the Environmental Impact of Our Business Activities and
Maximizing the Environmental Contribution of Our Products
R&D
Create
Utilize
NSK deepens its Four Core
Technologies̶tribology,
materials, numerical
simulation, and mechatronics̶
to reduce CO2 emissions by
minimizing friction, reducing
size and weight, and extending
service life spans.
Environmental
Contributions
through Four Core
Technologies,
including Tribology
By monitoring the conditions of products,
predicting their service life, and performing
repairs, NSK contributes to improved
reliability and resource conservation.
Environmental Contributions
through Services
Production
Material
Recycle
Waste
Transportation
Use
Repairing
products
❶Heat insulation
coatings on
roofs of plants
❷Improving
efficiency of
heat treatment
❸Utilizing
renewable energy
●
❶
●
❷
●
❸
Condition
monitoring
solutions
Low-friction 3rd
generation tapered
hub unit bearings
for automotive
wheels
Next-generation
high load capacity
tapered roller
bearings for wind
turbines
7th generation low-
friction tapered roller
bearings for automotive
transmissions
Production
Services
Products
NSK REPORT
2024
43
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
CO₂ Emissions (Thousand t-CO₂)
1,019
876
856
708
581
636
143
142
132
120
127
421
107
346
102
998
839
701
■ Scope 1 ■ Scope 2
Renewable energy
Energy
reduction
Achieve
Carbon
Neutrality
(CN)
FY2020
FY2023
FY2030
FY2035
FY2026
FY2017
763
528
448
-50%
compared with
FY2017
Target
Energy
conservation
❶
Technological
innovation
❷
❸
-52%
compared with
FY2017
CO₂ emissions assuming current
business activities are maintained
● We are increasing energy efficiency through group-wide initiatives in
energy conservation and technological innovation in production activities.
● We will expand the use of clean energy, such as hydrogen.
● We are deepening collaboration with suppliers and will change
production methods at NSK and its suppliers to reduce CO2 emissions.
In addition, we will expand the use of low-CO2 materials and biomass
plastics.
Environmental Management
Sustainability Initiatives
05
Scope 1, 2, and 3
Classifications of greenhouse gas emissions in the supply chain from the creation to
the disposal of a product
Definition
Scope 1
Direct emissions of greenhouse gases by the company itself
Scope 2
Indirect emissions from the use of electricity, heat, or steam supplied by another company
Scope 3
Indirect emissions other than those covered by Scope 1 and Scope 2
Efforts to Minimize Environmental Impact from Our Business
NSK considers reducing energy consumption to be the top priority in minimizing CO2 emissions during the manufacturing process. While promoting steady energy-saving activities to
eliminate waste globally, NSK is advancing the development of innovative manufacturing technologies using its core technologies. In addition, renewable energy is being utilized in
energy procurement for reduced environmental impact, and the Company is looking to transition to even more environmentally friendly materials and energy sources in the future.
Initiatives at the “Create” Stage ーReducing In-House CO2 Emissionsー
R&D
Services
Production
Products
Create
Utilize
Toward Achieving Carbon Neutrality for Scope 1 + 2 by FY2035
Toward Achieving a Net-Zero CO2 Emissions Society by 2050
● By FY2035, NSK aims to achieve carbon neutrality for Scope 1 and 2, with a goal of reducing
CO2 emissions for Scope 1 and 2 by 50% by FY2026 compared with FY2017 levels.
● In FY2023, CO2 emissions were reduced by 52% compared with FY2017, on pace to exceeding
the target.
NSK is advancing efforts based on three pillars: ❶ energy conservation, ❷ technological
innovation, and ❸ renewable energy.
FY2035
FY2050
FY2026
FY2017
Transition
to clean
energy
Collaboration with suppliers
(change production methods)
Scope 3
Upstream
reduction
Solar power generation
CO2-free electricity
Hydrogen,
etc.
Energy
reduction
Ultra-stabilization of production (DX)
Global expansion of energy-saving activities
(daily improvements, such as reducing and stopping
unnecessary energy consumption, and using
high-efficiency equipment)
High-frequency induction heat treatment
Scope 1 and 2 CN
Low-CO₂ materials
(electric furnace steel, hydrogen-reduction iron, biomass plastics)
Scope 3 upstream reduction
⇒ Contributing to net zero
Note: Figures from FY2022 onward exclude discontinued operations.
NSK REPORT
2024
44
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
0
20
40
（%）
FY
2018
FY
2017
FY
2019
FY
2020
FY
2021
FY
2022
FY
2023
0.2
0.8
2.2
6.7
8.3
21.5
34.5
The heat treatment process accounts for more than 20%
of NSK’s total CO2 emissions (Scope 1 and 2). To address
this challenge, NSK is advancing the development and
deployment of high-frequency induction heat treatment
technology. Unlike conventional heat treatment, which
heats parts inside a furnace from the periphery, high-
frequency induction heat treatment directly heats only
the parts themselves, significantly improving energy
efficiency and contributing to the reduction of CO2
emissions. This technology has already been introduced
in multiple domestic and overseas factories.
Introduction of High-Frequency Induction Heat Treatment
Conventional
heat treatment
furnace
High-frequency
induction heat
treatment
Heating the
entire furnace
Heating only the
target object
Scope 3 Upstream Reductions
❶ Energy Conservation
❸ Renewable Energy
NSK views energy conservation as
the foundation for reducing CO2
emissions by thoroughly eliminating
waste in production activities and
making steady improvements.
In addition, we are deploying
initiatives to improve productivity
using DX with the aim to enhance
energy efficiency.
As of FY2023, reduction in energy
intensity has been on track to exceed
the target reduction of at least 1% per
year compared with the FY2017 level.
NSK is advancing its plan to switch all
sites to renewable energy. The ratio
of renewable energy being used to
the Group’s total energy consumption
increased from 21.5% in FY2022 to 34.5%
in FY2023. In Europe, all sites have
switched to CO2-free electricity, and the
transition is progressing in Japan, the
ASEAN countries, and North America.
In addition, most of our factories in China
have installed solar power generation
systems.
Rate of Renewable Energy Use
❷ Technological Innovation
NSK is reducing CO2 emissions across the Group by introducing groundbreaking
manufacturing technologies at both domestic and overseas plants, and expanding their
application to a wider range of products.
Strengthening Collaboration with Suppliers
To accelerate reductions in Scope 3 upstream emissions, which account for the
majority of NSK’s total CO2 emissions, NSK is strengthening collaboration with
component suppliers.
NSK representatives visit the key suppliers to explain the importance of carbon-
neutral initiatives and how these efforts can also help strengthen their businesses,
eliciting their understanding and cooperation. From FY2022 to FY2023, collaboration
with suppliers expanded to approximately 20 companies, covering around 40% of
the value of procured components. NSK shares measures with suppliers and supports
CO₂ reduction measures tailored to each company’s circumstances. Over the past
two years, CO₂ reduction measures for key products have resulted in a reduction of
5.7%, surpassing the 5.2% target. Going forward, NSK will strengthen collaboration
with overseas suppliers to further promote reductions.
Use of Low-CO2 Materials
NSK has developed the world’s first
cage made from 100% plant-derived
biomass plastic. The material, castor
beans, absorbs CO2 during its growth,
resulting in reduced CO2 emissions
compared to traditional petroleum-
derived materials.
By introducing the latest digital measuring devices, NSK
detected more than twice the number of air leaks in the
piping supplying compressed air from compressors to
production equipment compared to FY2021, before these
devices were installed. As a result, electricity savings
have tripled. This initiative is being expanded globally,
contributing to reductions in CO2 emissions and costs.
エア漏れ削減
Reducing Air Leaks
Efforts to reduce air leaks
Biomass plastic cage
Castor bean materials
Target ● Actual Results
-30
-20
-10
0
10
（%）
FY2017
(Base year)
FY2020
FY2023
FY2026
-19.4
-10
On pace to
exceed the target
-17.9
Target: -1% or more annually
Change in Energy Intensity
Note: Figures exclude discontinued operations.
Notes: 1. Renewable energy usage rate = Renewable
energy usage/Total energy consumption
2. Figures from FY2022 onward exclude discontinued
operations.
NSK REPORT
2024
45
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
■Product Creation Designed to “Contribute to a Safer, Smoother Society” and “Help Protect the Global Environment”
Neco formula
■Environmentally Friendly Products Developed in FY2023
Product Name
NSK’s Technology
Development
Environmental Contribution
at Customer
Neco
Low-dust and
decontamination-
compliant actuator
● Improved low-dust performance,
decontamination resistance
● Reduced friction torque
● Long-term stable
operation
● Energy savings
1.66
Low-dust, high-
performance bearings
for servomotors
● Improved low-dust performance
● Improved seizure resistance
● Reduced friction torque
● Long-term stable
operation
● Energy conservation
1.41
Bearings for gas turbine
generators for eVTOL
(large drones)
● Reduced lubricant use
● Reduced power loss
● Resource conservation
● Improved fuel
efficiency
1.34
Neco =
Product
value (V)
Environmental
impact (E)
Click here
for more
information on
Neco value. ▶
Degree of improvement in
product value, such as life span,
performance, and accuracy
Degree of reduction in
environmental burden such as
weight and friction loss
Environmental Management
Sustainability Initiatives
05
CMS
Four Core
Technologies
plus One
Basic Policy for the Development of
Environmentally Friendly Products
NSK
Society/Environment
Advancement
of facilities and
technology
Development of
eco-friendly
industries
Creating value across
product life cycles
Environmental contribution
through condition monitoring
and reconditioning services
● Condition monitoring solutions
● Condition detection, diagnosis of remaining life, and
improvement proposal reports
● Reconditioning, reuse
Four core
technologies plus
the manufacturing
engineering that
actualizes them
● Tribology
● Materials
● Numerical simulation
● Mechatronics
＋
● Manufacturing
engineering
Environmental
contributions through
products
● Energy conservation
● Resource conservation
● Clean tech ● Safety and comfort
Building a safer,
smoother society
Protecting the
global environment
Reduction of
environmental
impacts
Bearings
Automotive
parts
Steelmaking
equipment
Injection
molding
machines
Automobiles
Home
appliances
Wind
turbines
Machine
tools
Precision
machinery
parts
Efforts to Maximize the Environmental Contribution of Our Products
While many automobiles and industrial machines worldwide consume vast amounts of energy by operating for extended periods, NSK's products aim to reduce this energy consumption to the
greatest extent possible through downsizing, weight reduction, and low torque. Furthermore, they are used in renewable energy facilities such as wind turbines, contributing to their spread.
On the other hand, because the production and processing of steel, which is a key material for NSK, requires many resources, NSK promotes waste reduction and efficient use of resources
through product life-span extension and recycling. Through these efforts, NSK is working to reduce CO2 emissions throughout the entire product life cycle.
R&D
Services
Production
Products
Create
Utilize
Initiatives at the “Utilize” Stage ーContributing to the Reduction of Customers’ CO2 Emissionsー
As a proprietary method for quantitatively evaluating the environmental
contribution of products, the Company has introduced NSK Eco-
efficiency Indicators, otherwise known as Neco. These indicators
quantify the environmental contribution of products in comparison to
previous versions based on factors such as life span, low torque, power
consumption, and weight reduction. The higher the Neco value, the
greater the contribution, with a target of Neco 1.2 or higher for newly
developed products.
Concept of Environmentally Friendly Products
Indicators for NSK Environmentally Friendly Products
1. Each product should contribute
toward the energy and resource
conservation of the machine in which
it is installed.
2. The amount of energy and resources
required during product
manufacturing should be minimal.
3. Environmentally harmful substances
should not be used in products or
manufacturing processes.
4. Products should contribute to the
health and safety of end users by
having low levels of vibration, noise,
and dust emissions.
Basic Policy
for the
Development of
Environmentally
Friendly Products
In pursuit of contributing to a “safer, smoother society” and to “help protect the global environment,”
as outlined in its corporate philosophy, NSK is advancing the development of environmentally friendly products
and technologies in line with its “Basic Policy for the Development of Environmentally Friendly Products.”
NSK REPORT
2024
46
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Shipment
Procurement
Life span
Manufacturing
Operation
Maintenance
Create
Utilize
Condition
monitoring
Condition
monitoring
Extended life span
Low friction
Raw
materials
Biomass
plastic
▶ P.45
Reconditioning
7th Generation Low-Friction Tapered Roller Bearings
Condition Monitoring Solutions and Reconditioning
Measurement and analysis using dedicated
sensors and devices
Visualization and
diagnostic services
Maintenance
Reconditioning
Reuse
In addition to selling products, NSK provides technical services such as maintenance
and condition monitoring technology, aiming to reduce CO2 emissions throughout
the entire product life cycle̶from product restoration to disposal.
Replacement
Life cycle
Rolling friction between rolling
surfaces and raceway
Outer ring
Rollers
Inner ring
CO2 Emission Reduction through Services
Reduction in CO2 Emissions during Product Use
NSK’s products also contribute to reducing CO2 emissions during the “utilize”
stage at customers. We promote such efforts in two categories: direct
contribution*1 and indirect contribution*2. In FY2023, we contributed to
a reduction of 2.43 million tons of CO2 emissions.
(10,000 t-CO₂/year)
123
136
146
229
225
230
243
FY2023 results
●On track as
planned
●Contributed to
CO₂ emissions
avoided of
2.43 million tons
64
60
53
83
70
75
100
125
71
157
78
152
67
176
FY2018
FY2019
FY2020
FY2021
FY2022
FY2023
FY2026
FY2017
■ Direct Contribution
■ Indirect Contribution
FY2026 target for avoided CO₂ emissions: 3 million tons
■Avoided CO2 Emissions
Gearbox
Notes: 1. Figures from FY2022 onward exclude discontinued operations.
2. Avoided CO2 emissions in past fiscal years have been revised based on the emission coefficients
used to calculate CO2 emissions from electricity consumption in FY2023.
3. This calculation is based on the “Quantification Guidelines for CO2 Emission Reduction Contributions
by Bearings” from the Japan Bearing Industry Association (for direct contribution only).
Tapered roller bearings are capable of supporting large
loads and are used in applications such as automotive
transmissions. Since the 1980s, NSK has continuously
improved tapered roller bearings through various
methods. Its latest technology optimizes the number
of rollers, achieving an average 20% reduction in
friction across the entire rpm range. This improves fuel
efficiency and electric mileage for vehicles.
Condition monitoring solutions measure and analyze the vibrations of rotating and linear
motion mechanisms inside equipment to diagnose the product’s condition and life span.
This contributes to improved machine reliability and extended product life. In addition,
reconditioning enables product repair and reuse. ▶ P.19 Provide new product value
Extending the Basic Rated Life Span (Calculated Service Life) of Rolling Bearings
Through the development of high-precision service life prediction using the Micro-UT
method, the basic rated life (calculated service life of a product) can be extended
by up to twice its original life span. As a result, customers can switch to smaller
bearings, achieving downsizing and weight reduction of their machinery.
▶ P.23 Strategies to Change & Go Beyond
Please see our
website for more
information. ▶
Please see our website for
information on other
environmentally friendly products. ▶
*2 NSK’s products help reduce
CO2 emissions indirectly
by being incorporated into
customers’ decarbonization-
related equipment or
facilities, or through
services such as product
restoration.
*1 Direct contribution to reducing CO2
emissions through the performance of
individual NSK products
Low-friction 3rd
generation tapered
hub unit bearings for
automotive wheels
Next-generation high load
capacity tapered roller bearings
for wind turbines
NSK REPORT
2024
47
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Climate Change‒Related Risks and Opportunities:
Addressing the TCFD Recommendations
In January 2020, NSK expressed its support for the recommendations of the
TCFD (Task Force on Climate-related Financial Disclosures), and in line with the
recommendations of the TCFD final report, NSK is working to identify risks and
opportunities to its business activities due to climate change and to enhance its
disclosure information, including reflection in management strategies and progress in
response measures.
NSK has always recognized climate-related risks as risks of high importance, and
all groups across business divisions and functional departments have been working
to address them. Moreover, since FY2021, utilizing scenario analysis recommended
by the TCFD, and assuming short-, mid-, and long-term changes in the business
environment associated with climate change, we have been strengthening our efforts
to analyze the impact of climate change on NSK’s activities and identify issues.
With the aim of verifying the impact of climate change on NSK’s value chain and the
effectiveness of its countermeasures, two scenario analyses were conducted for the
period up to 2050: 1.5℃ to 2℃ and 4℃ temperature rises. The analysis confirmed
that NSK’s growth will come from proactively responding to market changes by
strengthening development, production, and sales of products and services that
contribute to energy conservation, while limiting the impact of stricter regulations
aimed at building a carbon-neutral society.
Risks and Opportunities from Climate Change
NSK has set long-term goals and is strengthening efforts
through the dual approach of reducing CO2 emissions from
business activities such as the creating of products, and
helping to avoid CO2 emissions when customers utilize the
Company's products and services.
NSK Strategy
Please see our
website for more
information. ▶
Biodiversity Conservation
NSK’s Approach
Evaluation from CDP*
To contribute to a Nature Positive*1 future, the NSK Group has established the
NSK Biodiversity Guidelines*2, outlining its basic policies and action guidelines
for biodiversity conservation. NSK monitors the impact of its business activities on
biodiversity, working to minimize negative effects and promote positive impacts.
Bearings, the NSK Group’s main product, are primarily made from special steel
produced by recycling steel scrap. After use by customers, these products are again
recycled as steel scrap, becoming raw material for steel production. For this reason,
NSK believes that its dependence on and impact on biodiversity during each stage, from
the procurement of parts and raw materials to production, customer use, and disposal,
is relatively small. However, the NSK Group recognizes there is a broad connection
between its activities and biodiversity. To minimize impacts and expand contributions,
NSK is actively working toward no net loss in biodiversity*3, including efforts to prevent
deforestation*4 in procurement and production activities.
NSK replies to various international organizations’ surveys to verify the effectiveness of
its environmental initiatives through external evaluations. In FY2023, NSK’s advanced
efforts to address climate change were recognized by the international environmental
nonprofit organization CDP, earning an “A-” rating for the second consecutive year, the
second-highest grade.
*1 Nature Positive refers to putting nature on a path to recovery, halting and reversing biodiversity loss.
*2 These guidelines were established on October 5, 2010, with the approval of the President and CEO after discussions
by relevant officers in the Global Environment Protection Committee in August 2010.
*3 No net loss refers to compensatory measures that offset the loss of biodiversity caused by human activities,
ensuring no net loss in biodiversity.
*4 Deforestation refers to the conversion of natural forests to non-forest land or plantations, or continuous
degradation that leads to the loss of natural forests.
Evaluation of Biodiversity Engagement
NSK evaluates its relationship with biodiversity using assessment tools to analyze the
connections between its business and biodiversity. This analysis concluded that NSK’s
business sector does not have significant dependence on or impact on ecosystem
services. However, as some production sites are located near nature conservation areas,
NSK takes maximum care to preserve biodiversity.
Social Contribution Activities Related to Biodiversity Conservation
NSK is engaged in social contribution activities around the world that are related to
biodiversity conservation, including the protection of endangered species, tree planting,
Satoyama conservation activities, protection of natural monuments, and coastal
preservation. In particular, we have created a seedling nursery in Thailand.
Please see our website for
information on activities. ▶
Please see our
website for more
information. ▶
Environmental Management
Sustainability Initiatives
05
* CDP stands for Carbon Disclosure Project, a non-governmental organization managed by a UK charity.
NSK REPORT
2024
48
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
● Improved yield
● Review of processing
conditions
● Process improvement
● Waste separation,
improved recyclability,
exploration of
recycling applications
● Green procurement,
CSR procurement,
active use of recycled
materials
● Green steel, electric
furnace steel
● Bioplastic
● Biogrease
● Use of recycled
materials
● Product design with
the 3Rs in mind
● Conserving energy and
resources
● Service development
● Reusable
packaging and
wrapping
● Modal shift
● Longer service life, high durability
● Low friction, compact, lightweight
● Reuse
● Recycling
● Incinerated with
energy recovery
● Reduction of
waste
Production
Procurement
Development
and design
Recycle
Transportation
Use
Waste
● Repair and maintenance
Repairing products
Heating
Steel
manufacturer
Steel
Cutting
Metal scrap
(blanking
waste)
Metal scrap
(turnings)
Rolling
(CRF)
Reducing turning
processes to
minimize metal scrap
Metal scrap
recycling
Outer
ring
Inner
ring
Turning
(raceway,
chamfer)
Hole
punching
Outer
ring
Inner
ring
Outer and
inner rings
separation
▶ P.47 Reconditioning
Resource Conservation and Recycling Measures
NSK’s Approach
Pursuing Improvements in Material Yield*1
The NSK Group is promoting efforts at each stage of the value chain to enhance the 3Rs
(reduce, reuse, recycle) through the development of environmentally friendly products
and efficient, waste-free production, all in pursuit of realizing a circular economy.
In its development and design divisions, NSK focuses on reducing product weight and
extending service life while developing products that are manufactured with minimal raw
materials and are easy to recycle after use. Procurement divisions work in collaboration
with suppliers to procure environmentally friendly parts and raw materials, including steel
materials made from recycled scrap metal. In manufacturing divisions, efforts are made
to reduce resource waste by improving material yield through process improvements
and refinements to tools and molds. In addition, NSK collaborates both internally and
externally with suppliers to recycle metal and grinding waste generated during production
back into steel, while also promoting water recycling and waste liquid treatment to
reduce waste emissions and improve recycling rates. Our logistics divisions contribute by
reducing waste emissions through the repeated use of packaging and wrapping materials.
Moreover, NSK ensures the proper disposal of waste by conducting voluntary
inspections at its business sites, carrying out on-site verifications of companies entrusted
with waste disposal, and enhancing management practices using information systems to
prevent any compliance violations.
The majority of NSK’s main products, such as bearings, are made of steel, and
approximately half of the CO2 emissions generated during the manufacturing process
come from steel production by steel manufacturers. Developing and expanding
environmentally friendly manufacturing methods that utilize steel efficiently, without
waste, and enable resource conservation is a crucial issue for reducing CO2 emissions
throughout the supply chain.
When manufacturing the outer and inner rings of bearings primarily from bar steel
through turning*2, the material yield is usually below 50%. However, by revising the
manufacturing method, it is possible to improve the yield to above 60%, thereby
reducing the amount of steel used (see the chart below). NSK has focused on high-
production volume products for these improvements, but it is now working on
expanding the range of applicable products and further improving yields. In addition,
improving yield reduces the amount of metal scrap generated in the manufacturing
process, which in turn decreases CO₂ emissions during recycling into new steel at
steel manufacturers. Through the efficient use of resources, NSK is contributing to the
realization of carbon neutrality and a circular economy for society as a whole.
Please see our
website for more
information. ▶
Manufacturing Process with Improved Yield (image)
*1 The ratio of the weight of the finished part to the weight of the raw material input into the process.
*2 A machining method in which steel is rotated and shaped by applying a tool called a bit to achieve the desired form.
NSK REPORT
2024
49
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Sustainability Initiatives
05
Compliance
The NSK Group has positioned compliance as one of its core values. For NSK, compliance
goes beyond adherence to laws and regulations. It also entails acting in accordance
with internal rules, social norms, and the Corporate Philosophy in a sincere and fair
manner. Moreover, compliance means earning the trust of society and contributing to the
development of the economy and society in Japan and around the world.
To revisit the lessons learned from past incidents, reconfirm the resolve of all NSK
Group employees that no anticompetitive incident will ever occur again, and ensure that
all employees review the Corporate Philosophy and make it their own code of conduct,
July 26, the date of our on-site inspection by the Japan Fair Trade Commission, has been
designated as “NSK Corporate Philosophy Day.”
In FY2023, a message from the president was delivered to locations in Japan and other
countries, and employees watched a video about the cartel incident and an explanation
of NSK’s Corporate Philosophy. In Japan, initiatives were introduced to foster a
workplace culture that embodies “Beyond Limits, Beyond Today,” our action guidelines
for realizing the Corporate Philosophy.
Overseas, after a message from the management of local bases, each site held its own
events that included lectures by outside experts and discussions on compliance.
With the aim of reducing compliance risks in each division, the NSK Group conducts
compliance training by department.
In sales departments, since FY2012, we have been holding training sessions on the
competition law and preventing the fading of awareness toward the cartel incident.
In FY2023, this training focused on the Antimonopoly Act and the importance of accurate
recordkeeping in corporate activities. We continued our storytelling initiatives, which
were launched in FY2020, to reflect on and convey the facts and lessons learned from the
cartel incident. All employees in domestic sales departments participated in this training.
In production departments, training focuses on the prevention of data falsification
and other quality-related fraud, as well as harassment. In FY2023, this training was held
at nine production sites in Japan.
In engineering departments, we conducted training on the themes of fostering
engineering ethics and preventing quality fraud such as data falsification. In FY2023,
employees from all technical departments in Japan attended the course.
In addition to department-specific training, we provide annual compliance e-learning
to all employees with a corporate e-mail address.
As a result of these training and awareness-raising activities, the percentage of
favorable responses to compliance-related questions in engagement surveys improved
from 59% in FY2019 to 72% in FY2023. ▶ P.75 Non-Financial Highlights
NSK’s Approach
NSK Corporate Philosophy Day
Improvement of Compliance Awareness
The NSK Group has made explicit in its internal rules that employees who learn of acts
that violate or might violate the NSK Code of Corporate Ethics or compliance are to
contact the compliance hotline made available in their regions and countries. The Group
makes sure that employees are well informed about these hotlines. In some countries
and regions, the hotline is available to suppliers, as well.
We have also set up internal and external hotlines, which accept reports 24 hours a
day. The system allows hotline users to remain anonymous, and rules are established to
ensure they are protected from disadvantageous repercussions. Reported incidents are
investigated by the Legal and Compliance Division Headquarters in Japan and by the
local legal department outside Japan with the help of relevant departments as needed.
If a compliance violation becomes apparent, corrective actions and recurrence
prevention measures are quickly taken where needed.
In FY2023, 131 reports were received globally.
Compliance Hotline (Whistleblowing System)
Please see our
website for more
information. ▶
Completion
1. Internal
compliance hotline
2. External
compliance hotline
Compliance hotline
Semiannual review,
depending on the case
Verification of the
state of corrective
measures
Whistleblower
Subject of the whistleblower’s report/
Department of the subject
Receipt of
whistleblower’s report
Determination
of whether there
is a compliance
violation
Consideration of
the necessity of an
investigation and
investigation policy
Investigation
Instruction of
corrective measures
(if necessary)
Follow up
Notification of receipt of the report
within one business day of receiving it
Request for additional
information, if necessary
If there is a risk that the whistleblower
could be identified during the
investigation, the investigation method
is explained, and the whistleblower’s
consent is obtained before proceeding
Reporting of
investigation results
and corrective
measures
Verification of
whether there
has been any
disadvantageous
treatment
Compliance Hotline (Whistleblowing System) Diagram
NSK REPORT
2024
50
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Cooperation
Cooperation
E
n
g
a
g
e
m
e
n
t
w
it
h
S
t
a
k
e
h
o
l
d
e
r
Risk
assessment
Human rights
due diligence
Monitoring
Prevention
and
mitigation
Disclosure
improvement
Cooperation
Report
Core Values Committee
Related Divisions
Related Divisions
Group Companies
Group Companies
Human Resources & General Affairs, Procurement, Manufacturing Strategy,
Quality Assurance, Legal Compliance, Corporate Communications
■Japan
Human Resources ＆ General Affairs Division HQ
■Department responsible for Human Rights promotion
■Each Region
Human Resources & General Affairs, Procurement,
Manufacturing Strategy, Quality Assurance, Legal Compliance
■Each Region
Regional HQ
Risks of
high
significance
In March 2023, an evaluation of human rights risks by an external expert identified
“occupational health and safety (NSK Group)
▲
❶” as our risk of high significance. This
assessment reflects the fact that, like other manufacturing companies, NSK has employees who
work directly with machinery in plants and the Technology Division, where the frequency and
severity of injuries, such as being caught or entangled in equipment, were taken into account.
Sustainability Initiatives
05
Respect for Human Rights
NSK believes that respecting human rights is our responsibility as a multinational corporation
and that it is essential to support and respect international norms, such as the Universal
Declaration of Human Rights and the Guiding Principles on Business and Human Rights.
The NSK Code of Corporate Ethics clearly stipulates that we do not tolerate
discrimination or violations of human rights (e.g., forced labor, child labor) for
any reason. In the NSK Human Rights Policy, we respect the human rights of our
stakeholders and work with our suppliers on efforts to evaluate, prevent, and mitigate
impacts on human rights.
In line with the United Nations’ Guiding Principles on
Business and Human Rights, the NSK Group manages human
rights risks by following the human rights due diligence
process shown on the right.
NSK’s Approach
Addressing Human Rights Risks
The Human Resources and General Affairs Division Headquarters is the organization
responsible for promoting the NSK Group’s human rights initiatives, including the
strengthening of human rights risk management across the Group. Each functional
headquarters, including human resources and general affairs, procurement,
manufacturing strategy, quality assurance, and legal compliance, collaborate globally
in the practice of human rights due diligence for both the NSK Group and suppliers.
The Human Resources and General Affairs Division Headquarters shares and
discusses regional issues with regional headquarters outside Japan to develop
responsive measures, too. It also promotes human rights education for all global
employees. Moreover, it regularly holds NSK Human Rights Meetings as a venue for
sharing information across the Group. Important matters discussed at these meetings
and progress on human rights due diligence initiatives are reported to the Core Values
Committee. ▶ P.61 NSK’s Corporate Governance Structure
System
Please see our
website for more
information. ▶
Risk Assessment
We have identified NSK’s key human rights risks with reference to human rights issues
expressly stated in NSK’s codes and guidelines, as well as information from Japan’s
Ministry of Justice and the CSR guidelines of major customers. We then held interviews
with external experts and NSK’s functional division headquarters in Japan and regional
headquarters outside Japan. Considering human rights risk cases emerging in related
industries, we identified NSK’s key human rights risks and assessed their priority level
(likelihood of occurrence × severity).
❶ Safety Initiatives
❸ Supply Chain Management
❷ Education and Training (Employees)
▶ P.39 Safety Management
Regarding occupational
health and safety (NSK
Group), which has been
identified as a significant
risk, NSK is advancing
safety initiatives, such
as safety education and
the training of certified
safety assessors.
Education and training
program name
Number of
participants
Company-wide training
(in-person)
All domestic
sites
Company-wide e-learning
(domestic and some overseas
locations)
About 12,000
participants
Training by rank and target
group (e.g., new employees,
managers, sales staff, expatriates)
About 900
participants
NSK conducts educational and
training programs focused on
human rights.
NSK distributed a video to
suppliers about its human
rights initiatives.
▶ P.41 Supply Chain Management
Prevention and Mitigation (FY2023 initiatives)
Remediation Measures (maintenance of consultation channels)
▶ P.50 Compliance Hotline (Whistleblowing System)
NSK REPORT
2024
51
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Sustainability Initiatives
05
Information Security Management
Please see our
website for more
information. ▶
The use of digital technology is expanding across an increasingly wide range of fields.
At the same time, the volume of information and data is also increasing dramatically
with the forms in which it is held and used continuing to diversify. Against the backdrop
of this business environment, in addition to the risks associated with the improper
handling of information, there are growing concerns surrounding information leaks and
the adverse effects on the supply chain due to increasingly sophisticated cyberattacks.
Positioning information security management as one of its important management
tasks, NSK has established the NSK Group Basic Policy on Information Security*1 and
is working to reduce a variety of risks while strengthening its response to relevant laws
and regulations. Moreover, we are promoting initiatives for more robust mechanisms
and organizational structures, such as network countermeasures, against increasingly
sophisticated cyberattacks.
By utilizing globally adopted guidelines and frameworks developed by professional
cybersecurity organizations, NSK is creating a balanced approach to information security
management in the context of people and organizations, processes, and technologies, while
incorporating the concept of cyber resilience and working to strengthen these initiatives.
NSK’s Approach
Initiatives to Strengthen Information Security Management
*1 NSK Group Basic Policy on Information Security
https://www.nsk.com/information-security/
The NSK Group is enhancing its managerial resources and transforming its business
through the power of digital technology. NSK established the Information Security
Division (IT Governance Department, Information Security Promotion Group) under
the Digital Transformation Division Headquarters at NSK Ltd., the Group headquarters,
to enable the safe use of digital technology and to globally deploy information
security enhancement measures that take into account the relationship between
digital technology and cybersecurity. Moreover, information security‒related risks are
supervised under the Corporate Risk Management System. Information security is also
discussed by the Board of Directors as an issue that concerns the Group as a whole. The
Information Security Division regularly holds global meetings, working in cooperation
with information security management committees in Japan, the Americas, Europe,
China, ASEAN and Oceania, India, and South Korea. NSK is working to improve the
information security management level of the entire NSK Group, and to plan and
implement information security measures.
Furthermore, NSK has established a CSIRT*2 organization to quickly and appropriately
respond to cyberattacks, aimed at preventing the spread of damage and facilitating swift
recovery. NSK is also a member of the Nippon CSIRT Association.
Information Security System
*2 CSIRT is an abbreviation for Computer Security Incident Response Team, an organization that rapidly responds to
computer security incidents.
*3 Security Operations Center is an organization dedicated to detecting, analyzing, and taking countermeasures to cybersecurity threats.
Strengthening Measures for Normal Times
To reduce risks through understanding and evaluation, as well as rapid detection and
response, NSK is using external security assessment services to enhance monitoring and
measures, including the identification of vulnerabilities. In addition, we are advancing
technical measures to detect suspicious activities and security threats on information
devices and networks. Information about detected incidents is analyzed by the Security
Operations Center*3, which then implements countermeasures. With this structure, we have
established mechanisms for swiftly responding to security incidents. For all employees who
use computers, targeted e-mail cyberattack drills are conducted in collaboration with system
management departments at domestic and overseas Group companies, and e-learning
sessions are regularly held for employees in Japan and abroad. Through training based on
employee category, such as executives and system management department members, as
well as training for new employees or employees being assigned to overseas positions, NSK
strives to maintain and improve the awareness of employees about information security.
Enhancing Incident Response Capabilities
To improve incident response capabilities during emergencies, NSK participates
every year, including during FY2023, in the NISC/NCA Interdisciplinary Collaborative
Exercises organized by the National center of Incident readiness and Strategy for
Cybersecurity (NISC) and the Nippon CSIRT Association. In response to the increasing
risk of cyberattacks on supply chains, we are enhancing the security posture of plants by
assessing and managing risks in control equipment and organizing incident response
drills. We also check the information security practices of business partners and work to
improve the overall level of security measures.
Furthermore, by utilizing an information security management system, we are
enhancing the analysis and management of information and reports related to security
incidents both domestically and internationally, while also maintaining and improving
procedures and guidelines for incident response, ensuring that this knowledge is applied
across the organization.
NSK REPORT
2024
52
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
To ensure the business continuity of organizations and companies, it is essential
that each employee can respond appropriately in an emergency without relying on
instructions from a leader. With this in mind, NSK will introduce new training programs
in FY2024. These programs will
include learning methods for
rescuing and aiding causalities
using disaster simulations, as well
as provide leadership skills so
that people can solve problems
that rapidly materialize during
a disaster. Plans call for the new
training to start at a pilot plant
and then be expanded to other
locations.
Group Crisis Task Force
Emergency Response
Business Continuity/Recovery
Report
Lead/Instruct/
Advise/Support
Site Crisis Task Force
Crisis Management Director
Advise/Support
Report
Head (President & CEO)
Secretariat
Crisis Management
Committee
Secretariat
Chairperson & Members
President & CEO
Functional &
Business Division
Headquarters
Business Divisions
Human
Resources
General
Affairs
Crisis
Management
Office
Site B
Site C
Site A
Crisis
Management
Director
Team Leader,
Members
Emergency
Response Team
BCP Team
Team Leader, Members
Headquarters
Functions
Product Supply
Continuity Functions
Sustainability Initiatives
05
Business Continuity Management
-Initiatives to Strengthen Crisis Management
and Business Continuity Capabilities-
NSK’s basic policy is to place the highest priority on ensuring the safety of human life, to
respond to disasters in collaboration with society and to prevent disruptions to essential
operations and to promptly resume operations in the event of a suspension.
NSK has established a Business Continuity Plan (BCP). As part of its disaster
preparedness, NSK focuses on measures to reduce damage in the event of disaster. As
post-disaster measures, NSK works to shorten recovery times and investigate alternative
means of conducting business. We also ensure that necessary inventories are maintained
to fulfill our responsibility to supply products to customers.
NSK’s Approach
As an organization that directly reports to the CEO, NSK has permanently established
the Crisis Management Committee to oversee initiatives related to business continuity
management and to foresee the risks that the NSK Group might face. Based on this
preparedness, NSK has put into place systems during normal times while directing and
controlling organizations to respond to a crisis in an emergency.
Business Continuity Management Systems
Strengthening the Capabilities of Individuals
In addition, organizations have been established in each region outside Japan to
oversee business continuity management. The Crisis Management Committee will work
with these organizations to deal with risks when they materialize.
In light of frequent earthquakes and heavy rainfall, NSK is reflecting on its disaster
responses to identify areas for improvement in its BCP.
Recent insights have highlighted the need to improve decision-making and
communication methods when crisis levels escalate outside of normal working hours,
to better understand the latest hazard information around plants, replenish disaster
supplies, and ensure the effectiveness of preparedness through exercises.
Based on these reflections, we have carried out inspections of weather-related disaster
preparedness at all domestic and overseas plants.
Reflections on Disaster Responses
Disaster Simulation Workshops
Please see our
website for more
information. ▶
Normal Times
Emergencies
NSK REPORT
2024
53
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Appointed as a director at NSK in June
2022, having extensive experience as a
certified public accountant. She serves as
Chair of the Audit Committee.
Sayoko Izumoto
Appointed as a director at NSK in June 2021 after
serving as President and Representative Director of
Maeda Corporation. He serves as a member of the
Compensation Committee and the Audit Committee.
Koichi Obara
Appointed as a director at NSK in June 2022
after serving as president and representative
director of Yaskawa Electric Corporation. He
serves as Chair of the Nomination Committee.
Junji Tsuda
Appointed as a director at NSK in June 2023
after serving as vice-president and representative
director of Komatsu Ltd. He serves as a member
of the Nomination Committee.
Mikio Fujitsuka
Mr. Tsuda
01
The status of and changes in NSK’s
Board of Directors
NSK is working diligently to enhance its corporate
governance structure and systems to ensure its
sustainable growth and increase its corporate
value. Taking the initiative, the Company invited
10 representatives from 10 institutional investor
companies to meet with its outside directors on
May 22, 2024. Two of the outside directors, Mr.
Nagahama (who retired in June 2024) and Mr.
Fujitsuka, represented NSK at this small meeting.
In this dialogue, the outside directors provided
their thoughts on a variety of topics, including the
feedback received from institutional investors.
Mr. Obara
Since my appointment as an outside director of NSK
in June 2021, I have noticed a significant increase in
the time spent by the Board deliberating on strategic
agenda items. Recent global trends showcase the
growing focus on such issues as employee engagement,
diversity, and well-being and their increasing links
to sustainable corporate growth. The expanding
importance that these topics play in discussions by the
Board mirrors this movement, making me confident in
NSK’s ability to grasp and address global trends.
While some things change, others remain the same. I
was appointed an outside director of NSK in June 2022
and over the ensuing period, a non-executive director
has continued to chair NSK’s Board of Directors. Mr.
Nogami retired as an executive officer and succeeded
Mr. Uchiyama as Board Chair in June 2023. I am very
much in favor of a non-executive director chairing
the Board of Directors and believe that the Board is
operating effectively. Prior to taking up a position at
NSK, my experience was limited to companies with
an Audit and Supervisory Committee. Looking back
over my period at NSK, I can see that the Company is
well served by its Company with Three Committees
structure that separates the executive and supervisory
functions.
Corporate Governance
06
Outside Director Dialogue
NSK REPORT
2024
54
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
The time spent by the Board
deliberating on strategic agenda
items continues to significantly
increase.
Mr. Obara
Ms. Izumoto
I was also appointed an outside director in the same
month as Mr. Tsuda in June 2022. Each year, the
schedule and agenda for Board of Directors’ meetings
are set for the year ahead following the Ordinary
General Meeting of Shareholders held in June.
Operating in line with this agenda, meetings provide
the forum for vigorous discussion and the exchange of
various opinions and proposals. Meetings of outside
directors were also held once or twice a year until 2023.
In lieu of these meetings, the outside directors have
been meeting with the Board chair for about an hour
over lunch after each Board of Directors’ meeting since
May this year. These meetings allow us to comment on
issues that we were unable to discuss at the Board level.
02
Dialogue between institutional investors
and outside directors in May 2024
Mr. Fujitsuka
We received extremely harsh feedback in our dialogue
with institutional investors. NSK’s ROE, which has lingered
below 3% for the past five years, and the prolonged period
of little or no improvement have created the impression
that the Company’s interest in this key indicator is severely
lacking. With this in mind, NSK must remain acutely
aware of the need to take action and clearly communicate
the Company’s overall direction and ROE improvement
initiatives to the stock market. Institutional investors also
commented on the grounds for the CEO continuing in his
position as well as the Company’s CEO succession plan.
These comments reinforced the critical need to play an
active role both as outside directors and members of the
Nomination Committee to meet the expectations held by
external stakeholders.
Mr. Tsuda
planning process. In specific terms, we are defining
the attributes required of a CEO, including strategic
planning ability, the ability to execute those plans,
and organizational leadership. We then select certain
candidates in accordance with these requirements and
conduct evaluations both in-house and by external
organizations. Each candidate is then provided with the
necessary training and opportunities to gain practical
experience.
We must also carefully consider what the future
Board should look like. This includes the Board’s
composition and size, the distribution of skills among
its members, and the role and position of the CEO.
In clarifying our vision of the Board going forward,
we should then initiate steps to narrow down CEO
candidates to the most appropriate option. As we
advance this process to select a final candidate based
on the Company’s corporate strategy, rather than
rely on an average score, it is important that we focus
on and select a candidate who we believe is the best
person to lead NSK in its next step going forward.
Talking about the views of institutional investors
toward the Company’s CEO succession plan, NSK
is strictly adhering to its established succession
03
Monitoring progress of the new
targets set under MTP2026
Mr. Obara
In light of changes in the market environment and the
decision to shift its steering business to a joint-venture
structure, NSK reviewed its MTP2026 numerical
targets. While I recognize that an important function of
the Board of Directors is to oversee whether the revised
targets can be achieved, on a personal note, I would
like to focus on the underlying process of achieving
those targets. The efficacy of any PDCA cycle is solely
dependent on the integrity of the underlying process.
While NSK has a clear understanding of
what it wants to do, I feel that the ways and means
of achieving those things are not adequately
communicated to outside directors. I would therefore
hope that the Board will deliberate on process-related
issues.
NSK REPORT
2024
55
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
I will monitor the degree to
which the Enterprise Risk
Management system based on
a clear-cut three line defense
mechanism has taken root as
well as its efficacy .
Ms. Izumoto
immediately. Those issues that can be addressed in
the short term must be dealt with in a timely manner.
This includes, for example, the reduction of cross-
shareholdings.
Mr. Tsuda
Limited to the Group’s numerical targets, NSK’s
MTP2026 review in this instance did not extend to
policies and strategies. While the Group’s overall
direction remains unchanged, numerical targets were
revised to reflect changes in the business environment.
Against this backdrop, however, the Company’s
behavior is unlikely to change simply by revising its
targets. As Mr. Obara quite rightly points out, I would
expect the Board to also closely monitor what strategies
are being implemented to achieve the KPIs. I would
argue that the steps currently being taken to monitor
numerical targets are inadequate. I therefore believe
we must closely monitor the status of implementing
strategies to ascertain the degree to which the KPIs
are being achieved. In short, we must engage in
more detailed monitoring. If the Board’s monitoring
function is restricted to major measures and broad
targets, it runs the risk of losing sight of important
details, including the status of progress. With this in
mind, I would hope that the Board modifies the way
it monitors each initiative to include the manner of
implementation.
Mr. Fujitsuka
Even though NSK has refrained from revising its
MTP2026 strategies, steps have been taken to
revise numerical targets. Taking into consideration
the downward revision, external stakeholders will
undoubtedly expect the Company to succeed. As
outside directors, we must closely monitor the
executive function to confirm that strategies to achieve
targets are proceeding in accordance with plans. In
the event that there are areas where the Company is
falling short, we must review the need to implement
additional measures. We then must deliberate on all
of these issues with the Board. I also recognize that
executives have a great deal on their plates, and that
certain issues will take time while others can be tackled
04
NSK’s Enterprise Risk Management
(ERM) system
Ms. Izumoto
As far as the Company’s risk management is concerned,
the Internal Audit Department has historically
organized and summarized the numerous risks
identified by frontline divisions through a process
that we have dubbed the risk identification and
assessment process. For all intents and purposes,
executive divisions have therefore played no role
in the supervision of risks. Put another way, the
department in charge of internal audits has organized
and classified risks while also formulating audit plans.
This runs the very real prospect of employing an insular
self-contained approach toward risk awareness and
risk treatment. Moreover, top management and the
Internal Audit Department have received reports for
all incidents that arise irrespective of their importance.
Given the premium placed on time, this highlighted
the critical need to fine-tune the reporting process. As
a case study in point, if safety or environmental issues
occurred at a plant related to the automotive business,
the Automotive Business Division Headquarters and
production divisions would get involved, but there
could be considerable uncertainty surrounding the
extent to which the functional division headquarters
of the second defense line that is responsible for these
issues should take and horizontally deploy action.
As a result of fine-tuning this reporting process, NSK
clarified the role and responsibility of the functional
division headquarters as the second defense line.
Corporate Governance
06
Outside Director Dialogue
NSK REPORT
2024
56
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Mr. Tsuda
It is vital that we heighten our
sense of crisis with respect to
our own actions and step up our
awareness of the need to fulfill
our commitments.
The Company also threw a light on other aspects of
the risk management function, including the role of
the Corporate Planning Division Headquarters as the
division overseeing risk management under a so-
called Three Lines of Defense structure. Under this
structure, each division takes specific actions based
on the responsibilities attributed to them by their
position within the structure. The first line of defense is
each business site, which is responsible for advancing
specific treatment and countermeasures aimed at
addressing risks and incidents. The second line is the
functional division headquarters, which is charged
with the responsibility of managing risks from the
specialized perspective of its respective functions, as
well as the Corporate Planning Division Headquarters,
the division overseeing the risk management process.
Finally, the third line is the Internal Audit Department.
After defining this Three Lines of Defense structure,
the decision was made to determine and monitor the
progress of treatment and countermeasures designed
to reduce those risks that were identified through the
risk assessment process that are yet to materialize. In
short, looking beyond the management of incidents
that have already occurred, the Company decided to
put in place a mechanism to manage the efforts being
made to reduce risks that have not yet materialized.
Furthermore, NSK has introduced external software
to ensure the comprehensive management of risk,
encompassing everything from the risk assessment
process to reporting functions. In addition, the
new Enterprise Risk Management system has been
incorporated as an audit item for review by the Audit
Committee this fiscal year to ensure that it is firmly in
place and is functioning effectively.
Mr. Fujitsuka
From experience, risks are frequently hidden in remote
and overlooked places. This is especially the case with
affiliated companies where the equity stake is small and
involvement is limited. Compared to subsidiaries, control
is limited. As a result, risks might often appear upon
examination. For this reason, steps were taken to closely
examine these remote and overlooked areas where the
Company’s interest was limited to a minority stake.
05 NSK’s corporate culture
Mr. Tsuda
Formed at the time of establishment, the essence
of a company’s corporate culture does not easily
deteriorate. Considerable time and effort are therefore
required to bring about a change. When formulating a
mid- to long-term management plan there is often the
need to change the way employees think. Accordingly,
top management must take considerable action to
achieve this end. In NSK’s case, however, there was no
such need to substantially change the essence of its
corporate culture with MTP2026. MTP2026 is in fact
grounded in the Company’s tradition, and its strategies
built on NSK’s existing identity.
NSK’s review of MTP2026 was limited to numerical
targets. As such, the Company’s strategies and
corporate culture remain unchanged. Having said this,
it is crucial that the Company maintains an acute sense
of crisis given the downward revision in this instance.
Disparate from the overall vision of the company
NSK wants to become, its activities, and its presence
within the community, it is important that NSK adopt
a greater sense of urgency toward its management
and actions. The Company must become increasingly
conscious of its need to fulfill its commitments as
an organization. While not quite extending as far as
a change in NSK’s corporate culture, the downward
revision of numerical targets dictates the need for a
major change in mindset.
Mr. Obara
Rallying to the slogans MOTION & CONTROL™,
Change & Go Beyond, and Bearings & Beyond, NSK
has declared its commitment to contribute to society.
I have been greatly impressed over the past three
years by the Company’s outstanding technological
capabilities and its stance toward ensuring the
continued development of these capabilities in its bid
to fulfill this commitment. I would offer that this is an
NSK REPORT
2024
57
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Assembled product manufacturers that are responsible
for assembling end products are also a part of the
BtoB business. Assembled product manufacturers
field a variety of issues and concerns from end-users
and accordingly convey to component suppliers how
to address and resolve these issues. Recognizing
that they are not always privy to the wide-ranging
deliberations within assembled product manufacturers,
suppliers now join in discussions and work together
with them to collaboratively create solutions. It is
therefore imperative that suppliers build this type of
collaborative relationship with assembled product
manufacturers. In the bearing industry, too, it is
important for suppliers to create a system that allows
for collaborative creation between suppliers and
assembled product manufacturers.
As a manufacturing company that has operated for
more than a century, NSK’s first priority is to operate its
plants. Then, the Company determines the selling price
of its products based on manufacturing cost. Having
said this, I feel that NSK has yet to fully embrace the
concept of sales based on the value of products. A shift
in the Company’s mindset is therefore required. I get
the feeling that there is a gap between the value that
customers sense is being delivered and the actual value
of the product. In a BtoB business where the price of
a product is increasingly determined by its value as
opposed to cost, NSK must work to enhance customers’
understanding toward the value of its products and
services.
While going back a number of years, I do have first-
hand experience working for a company that suffered
a dramatic deterioration in its performance. Among a
host of initiatives, steps were taken to review domestic
affiliates as well as the personnel structure. In addition
to instilling among employees a keen sense of crisis,
these initiatives helped transform the company into
a completely different entity. Clear decisions were
made to withdraw from unprofitable businesses and
to expand businesses with the potential for growth.
I recall that these efforts helped to clarify important
issues. Bringing this experience to NSK, it is evident
that the Company is facing issues with respect to its
ROE, which has continued to trend between 2% and
3% for the past several years. Listening to deliberations
by the Company’s Board, directors often comment
that employees have voiced the view that they believe
Mr. Fujitsuka
Development, manufacturing,
and sales are the source
of competitiveness in the
manufacturing industry.
Strengthening and turning
each into the power that drives
NSK forward is of the utmost
importance.
absolute imperative for NSK to remain a leader in its
industry. The concept of ambidextrous management
has attracted growing interest of late. This concept
recognizes the need for mature companies to explore
new areas of business while simultaneously deepening
established mainstay operations. Applying the concept
of ambidextrous management to NSK, I am aware that
the Company has done an amazing job in deepening
its mainstay businesses. I would, however, argue that
the ability to identify new areas of opportunity, and to
then use these areas as a base to take on the challenge
of exploring new avenues is of equal importance.
Moreover, the open disclosure of information and open
innovation are also playing an increasingly prominent
role in society. Against this backdrop, it is becoming
more and more difficult for a single company to
achieve sustainable growth on its own. One means of
overcoming this challenge is to think of different ways
to collaborate with other companies. In doing so, I
believe NSK must cultivate the ability to address new
combinations of markets and customers.
NSK is an earnest company. While engaging in earnest
discussions and activities is indeed important, I believe
that taking increasingly bold and speedy action is also
of importance. This belief reflects the understanding
that bold and speedy actions that are conducted in
earnest will not be outdone.
Mr. Fujitsuka
Mr. Tsuda
Mr. Obara
Corporate Governance
06
Outside Director Dialogue
NSK REPORT
2024
58
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Mr. Fujitsuka
After engaging in frontline activities at a financial institution, I have
served as an outside director at several companies over the past seven
years. In the more than 10 years since drastic governance reform was
proposed as a part of the Japan Revitalization Strategy, the concept and
approach toward governance adopted by Japan’s corporate sector has
changed dramatically. With strong calls by the Tokyo Stock Exchange
for companies to engage in management that is conscious of the cost
of capital and stock price, domestic and foreign investors’ views of the
Japanese stock market are also undergoing significant change. NSK’s
corporate philosophy and slogan, MOTION & CONTROL™, are wonderful
expressions of the Company’s commitment to supporting the evolution of
technologies and the development of a prosperous society as a machine
component manufacturer. Regrettably, NSK’s recent weak performance
and an inability to properly visualize its growth strategy have led to a
slump in the Company’s share price, in turn blurring any recognition of
its true value. As an independent outside director, I would like to help
improve the Company’s corporate value and strengthen internal controls
by frankly raising issues and engaging in dialogue from the perspective of
external stakeholders at Board of Directors’ and other meetings.
Message from NSK’s New Outside Director
06
NSK’s vision and challenges for
enhancing its corporate value over
the long term
Mr. Obara
As I mentioned a moment ago, NSK’s ability to build
and engage in relationships of co-creation with a
variety of other industries is extremely important. I
also believe that NSK should pay a little more attention
to marketing. To engage in co-creation, the Company
must understand the markets in which it hopes to
operate. In this context, I believe NSK should market
how its business will develop going forward and then
apply its technologies accordingly.
hours will go into effect amid a driver shortage. Against
this backdrop, I suspect that this need for increased
efficiency will quickly spread to other industries. In my
opinion, I would hope that the bearing industry too will
follow suit.
Meanwhile, it is important that the Company increases
the efficiency of other areas of its operations to
streamline its operating structure. As a manufacturing
company, NSK must in particular develop outstanding
products that satisfy customers’ needs at prices that are
commensurate with their value. The Company must
continue to engage in business with the confidence
that it has the capabilities to more than compete.
NSK is a leader in its field, and I am confident that
the foundations are there. Being conscious of its
standing as a market leader, the Company must
develop products that customers will purchase at prices
commensurate with their value. Only in doing so will it
hope to move the world.
Mr. Tsuda
The fact that NSK’s ROE and profitability are low is
a major issue. I do feel that the Company is aware of
the big picture of how it can best address this issue.
However, the Company is weak when it comes to
maintaining a keen eye on pricing and generating
profit. Elaborating a little further, I believe the
Company’s broad strategy lays out the correct path for
the future. As long as NSK moves steadily forward with
this strategy while skillfully incorporating measures
to improve profitability, I am confident it will succeed
from a long-term strategic perspective. Once again, as
I commented earlier, I would hope that as a part of its
corporate culture and approach, NSK better highlights
its value to society.
Ms. Izumoto
Extending well beyond just bearings, the fact that there
is an excessive number of companies in absolute terms
is a major reason for the large number of companies
with low profitability relative to the shortage of labor in
Japan. Looking at the logistics industry as an example,
despite the substantial number of trucking companies,
signs of restructuring are beginning to emerge in
response to the so-called 2024 problem, in which
regulations that put restrictions on driver overtime
After serving in a variety of positions,
including President & CEO of Mizuho
Bank, Ltd., appointed a director of NSK
in June 2024. Chair of the Compensation
Committee.
Nobuhide Hayashi
Looking two to three years into the future, NSK’s first
priority must be to achieve MTP2026. Casting an eye
even further ahead, and I suspect Mr. Tsuda would
also agree, it is vital that the Company strengthens its
development, manufacturing, and sales capabilities,
which constitute the source of competitiveness in the
manufacturing industry. NSK should then leverage
these capabilities as the power that drives NSK forward.
NSK REPORT
2024
59
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
2015～
2006～
2004～
1999～
1999
● Established a Compensation
Committee (Voluntary)
2003
● Established an Audit
Committee (Voluntary)
2004
● Established a Nomination
Committee (Voluntary)
● Established Nomination, Audit, and
Compensation committees based
on the Companies Act of Japan
2017
● Chairs of three committees all
outside directors
Committee
2010
● Established criteria for the
independence of NSK’s
outside directors
● Each of the Company’s outside
directors registered with the
Tokyo Stock Exchange as an
independent director
1999
2003
2004
2005
● One-third or more are
outside directors
2018
● Appointed a
female director
1999
● Adopted an executive
officer system
2004
● Transitioned to a Company
with Committees System
2006
● Transitioned to a Company
with Committees
2015
● Transitioned to a Company with Three Committees
(Nomination, Audit, and Compensation)
2020
● Majority are
outside directors
2021
● Non-executive
chair of Board
of Directors
Outside 1
Outside 2
Outside 3
Outside 4
Outside 5
Outside 5
Internal 7
9
11
12
12
9
Note: The pie charts indicate
the number of directors.
Internal 4
7
Composition of the Board of Directors
Form of Corporate Organization
Policy on Development of Corporate Governance Systems
1
2
To ensure that supervisory organizations
have oversight of executive organizations
by clearly separating the two.
3
To strengthen supervisory organizations’
oversight of the executive organizations by
ensuring cooperation between the two.
4
To improve the fairness of management by
strengthening compliance systems.
Corporate Governance
06
Corporate Governance Systems
Please see our
website for more
information. ▶
NSK believes that the establishment and maintenance
of systems that ensure transparent, fair, and timely
decision-making is essential to achieve sustainable
growth and increase our mid- to long-term corporate
value. To realize this objective, we are working to
construct our corporate governance systems based on
the following four guiding principles.
NSK’s Approach
To increase the efficiency and agility of management
by proactively delegating decision making on the
execution of the operations from the Board of
Directors to the Company’s executive organizations.
Corporate Governance Systems
Current Corporate Governance System
NSK has adopted a Company with Three Committees (Nomination, Audit, and Compensation) system as its form of
corporate organization to better achieve the basic approach described on the left. NSK’s Board of Directors determines basic
management policies, with the aim of achieving the Group’s sustainable growth and increasing mid- to long-term corporate
value. The Board proactively delegates decision-making authority regarding business execution to executive organizations,
while supervising the status of implementation in an appropriate manner. The CEO has the ultimate authority and
responsibility for all decision-making and operational executive functions delegated by the Board. Under the direction of
the CEO, executive officers are responsible for executing their respective duties in accordance with their division of duties.
Changes to NSK’s Corporate Governance Systems
Internal 6
Internal 7
Internal 8
Internal 8
NSK REPORT
2024
60
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Outside director (Men)
Outside director (Women)
Internal director
Shareholders Meeting
Supervisory Organizations
Executive Organizations
President & Representative Executive Officer/CEO
Proposal ＆ Report
Election ＆ dismissal of Directors
Board of Directors
Chair
Report
Election ＆
dismissal of
each committee
member
Election ＆
dismissal of
Executive
Officers
Delegation
of authority/
Supervision
Report
Internal Audit Department
Officers’
Meeting
Operating
Committee
Nomination Committee
Chair
Compensation Committee
Chair
Chair
Direction
Cooperation
Report
Direction
Inquiry
Report
Direction
Crisis
Management
Committee
Disclosure
Committee
Core Values
Committee
Report
Direction
Report
Core Values Committee
Chair President & CEO
Members
Representative Executive Officer &
Executive Vice President,
Executive Officer & Executive Vice Presidents,
Executive Officer & Senior Vice Presidents
Objectives and Authority
● Discusses policies for promoting and strengthening core values (Safety,
Quality, Environment, and Compliance) and shares related risks
● Sets company-wide issues related to core values, makes
recommendations for their resolution, and monitors progress
● Promotes sustainability activities
● Supervisory Organizations
NSK’s Corporate Governance Structure （As of August 2024）
9 members
4 internal directors,
5 outside directors
3 members
2 outside directors,
1 internal director
3 members
2 outside directors,
1 internal director
3 members
2 outside directors,
1 internal director
Cooperation
Audit Committee
Number of times convened in FY2023 4
Board of Directors
Number of times convened in FY2023 10
Chair a non-executive director
Objectives and Authority
● Passes resolutions related to
basic management policies
(including delegation of
deciding on the execution of
the operations to executive
officers)
● Supervises the execution of
duties by executive officers
Main Activities during FY2023
● Determined consolidated financial statements,
appropriation of retained earnings, basic policy on
the establishment of internal control systems, and
the new executive system
● Established steering business joint venture
● Issued sustainability-linked bonds
● Verified the rationality of cross-shareholdings held
● Considered the direction of disclosure based on
the results of dialogue with institutional investors
● Assessed the Board of Directors’
effectiveness and acted on identified issues
● Determined the policy on budget management
● Monitored the progress of MTP2026
Nomination Committee
Number of times convened in FY2023 6
Chair Outside director
Objectives and Authority
● Determines the content of
proposals submitted to the
Shareholders Meeting regarding
the appointment or dismissal of
directors
Main Activities during FY2023
● Considered and determined the
composition of the Board of Directors
(including the skill matrix)
● Selected and determined FY2023 director
candidates
● Secured outside candidates
● Monitored CEO succession plan process
Compensation Committee
Number of times convened in FY2023 4
Chair Outside director
Objectives and Authority
● Determines policies on the
compensation of directors
and executive officers
● Determines the individual
compensation provided to directors and
executive officers, and other matters
Main Activities during FY2023
● Determined the policies on the
compensation of officers and other matters
● Determined the individual compensation
provided to directors and executive officers,
and other matters
● Determined the FY2023 officer
compensation system
Audit Committee
Number of times convened in FY2023 14
Chair Outside director
Objectives and Authority
● Audits the duties of directors
and executive officers and
creates audit reports
● Determines the content of proposals
related to appointment or dismissal
of the auditor, and other matters
Main Activities during FY2023
● Conducted audits of important management-
related issues (e.g., development of new Enterprise
company-wide Rrisk Management system) based
on audit plan and made recommendations
● Assessed the auditor (including important
matters to be discussed and the three-way
audit system)
NSK REPORT
2024
61
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
◎Chair ○Members
Name
Outside
Director
Date
Appointed
as Director
Experience and Expertise Expected
Nomination
Committee
Audit
Committee
Compensation
Committee
Business
Management/
Top Management
Corporate
Governance/
Internal Control
Global
Business
Engineering/
Manufacturing
Finance/
Accounting/
Capital Policy
Akitoshi Ichii
June 2017
●
●
●
○
Keita Suzuki
June 2023
●
●
●
●
○
Saimon Nogami
June 2013
●
●
●
●
Kenichi Yamana
June 2021
●
●
●
○
Koichi Obara
●
June 2021
●
●
●
●
○
○
Junji Tsuda
●
June 2022
●
●
●
●
◎
Sayoko Izumoto
●
June 2022
●
●
◎
Mikio Fujitsuka
●
June 2023
●
●
●
●
○
Nobuhide Hayashi
●
June 2024
●
●
●
●
◎
Breakdown of Discussion Time
FY2019
FY2020
FY2021
FY2022
Average time(Minutes)
147
140
159
141
696
782
815
769
1,465
618
1,400
592
1,407
FY2023
164
938
703
1,641
883
708
1,591
(Minutes)
FY2021
FY2023
41%
59%
FY2022
37%
63%
39%
61%
0
500
1,000
1,500
2,000
■ Discussion time ■ Explanation time
■ Discussion time for MTP2026-related/
mid- and long-term themes
■ Discussion time for agenda and reporting items
Corporate Governance
06
Composition and Initiatives for Enhancement of Board of Directors
The composition of NSK’s Board of Directors is
determined based on consideration of career diversity in
fields of expertise and business experience to ensure that
the Board maintains a well-balanced composition in light
of the Company’s mid- to long-term business strategy or
managerial issues as well as consideration of the size of
the Board to enhance the effectiveness of deliberations.
In appointing individual directors, in addition to
selecting persons based on experience in business and
management in general or experience in their area of
expertise, high ethical standards in management and
their insight into corporate governance are part of the
selection criteria.
Composition of the Board of Directors
Skill Matrix for Board of Directors/Composition of the Nomination, Audit, and Compensation Committees
Initiatives to Further Enhance the Effectiveness of the Board of Directors
FY2023 Initiatives
NSK’s Board of Directors proactively delegates decisions regarding the execution of
operations to the executive organizations, monitors the status of execution in an appropriate
manner, and discusses themes related to mid- to long-term management issues and
direction. To achieve active Board deliberations, the Company believes that it is important
to provide information to directors in advance of the meeting. We provide information in an
appropriate manner, including distributing materials to all directors in advance, and prior
explanation by officers and the Board secretariat.
Changes in Explanation and Discussion Times
Details of the Discussion
Related Page(s)
Monitored the progress of MTP2026
▶ PP.20‒21
ー Industrial Machinery Business
and Automotive Business
Road map for achievement of MTP2026 targets and
initiatives to address priority issues
▶ PP.22‒25
ー Ultra-Stabilization of Production
(Initiatives to improve productivity)
Status of initiatives in FY2023 and future initiatives
for FY2035
▶ P.32
ー Carbon Neutrality
Status of CO2 emissions in business activities and
energy conservation initiatives in production processes
▶ PP.42‒49
ー Bearings & Beyond
(Initiatives of technology
development)
Technology development strategies and new
technologies and new products for FY2026
▶ PP.18‒19, P.30
Engagement Survey
Results of engagement survey conducted in FY2022
(Target: NSK Ltd. and Group companies in Japan)
and initiatives to improve scores in the future
▶ PP.34‒37
Steering Business
Transition of the Steering Business to a joint venture
and state of progress
▶ P.25
Human Capital Management
Human capital‒related KPIs as well as FY2026 targets for these
KPIs and key measures for improving human capital management
▶ PP.34‒37
European Structural Reforms
Main points of European structural reforms
(reorganization of production sites and review of sales
sites and management system) and state of progress
▶ P.22
MTP2026-Related/Mid- and Long-Term Themes
NSK REPORT
2024
62
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
External experts
distribute
questionnaires and
conduct individual
interviews
Issues and
initiatives for the
next fiscal year
were considered
Assessment results
were shared and
discussed with the
Board of Directors
■ Target: 9 directors
■ Questionnaire items： ❶Management strategies and risk management ❷Composition of the Board of Directors
❸Role and processes of the Board of Directors ❹Meeting management ❺Stakeholder engagement
❻CEO succession planning ❼Committees (Nomination, Audit, and Compensation Committees)
❽Culture ❾Directors’ contributions 10 Importance of discussion themes and the amount of discussion
■ Individual interview：Individual interviews conducted by external experts based on questionnaire results
External experts conduct
an analysis and
assessment based on the
results of questionnaires
and individual interviews
FY2022 Issues
FY2023 Initiatives
Sharing the roles of the
Board of Directors amid
business restructuring
● A process whereby the chairperson of the Board of
Directors, outside directors, and the CEO discuss and
determine the Board meeting agenda was introduced.
● The Board of Directors was deeply involved in the
transition of the Steering Business to a joint venture.
Thorough and complete
monitoring of MTP2026
● Directors shared their understanding of monitoring
and coordinated with the executive side.
● The Board of Directors enhanced its discussions on
MTP2026 themes.
Further strengthening
the contribution of
outside directors
● Site visits and the practice of holding Board meetings
at plants were resumed, to deepen the business
understanding of outside directors.
● Communication was enhanced through the
resumption of regular meetings of outside directors.
FY2023 Issues
Main Future Initiatives
Enhancement of
discussions based on
perspectives of
stakeholders
● Enhancement of discussions (including discussions on
sustainability) based on the perspectives and opinions
of shareholders and the capital markets.
● Further enhance dialogue with shareholders and the
capital markets and information disclosures.
Further enhancement of
monitoring
● Monitor progress on each important theme and
update MTP2026 in response to changes in the
environment.
Awareness of and
appropriate involvement
in “defensive governance”
● Awareness of and appropriate involvement in
defensive governance (e.g., risk management, internal
control, group governance).
Involvement in
Nomination Committee
topics
● Hold discussions in a timely manner in response to
information shared as the Board of Directors.
Overview of and Procedures for Assessment of Effectiveness of Board of Directors
NSK conducts annual assessments of the effectiveness
of its Board of Directors functions and has worked to
further enhance performance every year since FY2015.
To maintain the objectiveness of these assessments, NSK
commissions external experts to conduct assessments
based on the results of these questionnaires and
individual interviews with all directors.
The results of the questionnaire and individual
interviews confirmed that the effectiveness of the Board
of Directors has improved in FY2023. In particular, the
steady progress in confirming the progress of MTP2026
and the enhancement of discussions at meetings
of the Board of Directors, such as the Board’s close
involvement in the transition of the Steering Business to
a joint venture, which was a major decision, were highly
evaluated.
Assessment Procedures
FY2023 Initiatives in Response to FY2022 Issues
Future Key Initiatives in Response to FY2023 Issues
NSK REPORT
2024
63
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Corporate Governance
06
Internal Controls, Cross-Shareholdings, Directors/Officers’ Compensation
Value of Holdings (¥ Billions)
Number of Shareholdings
■ Value of Holdings
Number of Shareholdings
122
136
118
114
114
108
103
97
89
79
72
67
60
57
52
46.4
49.2
48.1
56.4
67.5
79.0
54.0
64.8
69.7
57.9
40.7
62.7
41.6
36.9
50.2
10/3
11/3
12/3
13/3
14/3
15/3
16/3
17/3
18/3
19/3
20/3
21/3
23/3
24/3
22/3
Reduction of five stocks in
FY2023 and 84 stocks over the
14 years from March 31, 2010.
0
60
80
100
120
140
0
20
60
40
80
100
In addition to the steady reduction of
cross-shareholdings, all holdings in NSK’s
retirement benefit trust were sold in FY2023.
As a result, at the end of March 2024, the
proportion of cross-shareholdings in total
consolidated capital had fallen to 5.5%.
Category
As of March
31, 2023
As of March
31, 2024
Excluding retirement
benefit trust
6.6%
5.5%
Including retirement
benefit trust
15.1%
5.5%
Proportion of Cross-
Shareholdings in Total
Consolidated Capital
Number and Balance Sheet Amount of Shareholdings
Category
As of March 31, 2023
As of March 31, 2024
Number of
Holdings
(Stocks)
Total Amount
Recorded on the
Balance Sheet
(¥ Billions)
Number of
Holdings
(Stocks)
Total Amount
Recorded on the
Balance Sheet
(¥ Billions)
Unlisted stocks
34
1.0
32
1.0
Stocks other than
unlisted stocks
23
40.6
20
36.0
Total holdings
57
41.6
52
36.9
Holdings in NSK’s
retirement benefit trust
1
54.3
－
－
All holdings in NSK’s retirement benefit trust were sold in FY2023.
Total consolidated capital
634.7
678.0
Trend in Cross-Shareholdings (Excluding Retirement Benefi t Trust)
Cross-Shareholdings
Policy on Cross-Shareholdings
Criteria for the Exercise of Voting Rights Concerning Cross-Shareholdings
In principle, NSK holds no cross-holding shares. Conversely, we exceptionally hold
cross-holding shares in cases where it is deemed necessary to enhance the mid- to
long-term corporate value. Regarding the appropriateness of cross-shareholdings, our
executive organizations conduct quantitative and qualitative evaluations on an annual
basis to determine whether each individual shareholding is delivering acceptable
benefits in relation to our capital cost. The Board of Directors receives regular reports
from the aforementioned executive organizations and studies the matter accordingly.
We will sell any cross-shareholdings for which possession we believe cannot be justified,
taking into account stock prices and market trends.
NSK has defined specific criteria for the exercise of voting rights concerning cross-
shareholdings. When exercising voting rights, we confirm that the proposal in question
does not damage shareholder value and that it serves to improve the mid- to long-term
corporate value of both NSK and the company in which the stake is held. We engage in
dialogue, such as requesting explanations, with the company in which the stake is held
before determining whether we support proposals.
Internal Control
Having stipulated its basic policy on the establishment of internal control systems,
which forms its basic policy for the appropriate and effective functioning of global Group
management and internal control functions, NSK is working to strengthen its Group-wide
internal control systems. This basic policy consists of matters relating to the development
of the systems necessary for ensuring that the NSK Group’s operations are conducted in
an appropriate manner and that executive officers comply with laws, regulations, and the
Articles of Incorporation when performing their duties and matters necessary for the Audit
Committee in the performance of its duties.
The Board of Directors establishes this basic policy, regularly confirms the establishment
and operation of systems, and supervises their effectiveness. Based on this policy, executive
officers establish the specific systems (the organization/human resources structure,
decision-making/reporting systems, risk management, auditing systems, as well as the
internal regulations systems that support them, etc.) while reporting on the status of those
operations to the Board of Directors.
Reporting directly to the CEO, the Internal Audit Department is responsible for
conducting audits to determine the legality, adequacy, and efficiency, etc., of operations and
for monitoring of business execution and for the evaluation related to internal controls over
financial reporting from a standpoint independent from the auditees.
The Audit Committee collaborates with the Internal Audit Department that provides
support to audits conducted by the Audit Committee, to audit the performance of
operations as well as whether the internal control system is properly established and
operated.
As a result, the number of cross-shareholdings held by the Company has been reduced by
five stocks (including three listed companies) in FY2023, and from 136 stocks (including 79
listed companies) at the end of March 2010 to 52 stocks (including 20 listed companies) at
the end of March 2024, a reduction of 84 stocks (including 59 listed companies) over 14 years.
NSK REPORT
2024
64
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
1. Executive Officers’ Compensation
2. Directors’ Compensation
The compensation package for executive officers consists of fixed basic compensation and
performance-based compensation that fluctuates with performance. The Company generally sets
a compensation ratio of roughly 4:6 of fixed compensation to performance-based compensation.
The compensation package for directors consists of fixed basic compensation and stock
compensation that is variable compensation.
❶ Basic compensation
The amount of basic compensation is determined according to the title of the executive officer.
Moreover, an additional amount will be paid to executive officers with representative rights.
❷ Performance-based compensation
Performance-based compensation consists of short-term performance-based compensation
and mid- to long-term performance-based stock compensation.
a. Short-term performance-based compensation
Short-term performance-based compensation is determined based on metrics consistent
with management goals to increase profitability, raise the efficiency of shareholders’
equity, and improve corporate value: metrics related to the operating income margin,
ROE, cash flow, and ratio of new product sales to total sales, as well as an achievement
target for ESG goals for CO2 emission reductions and safety and quality improvement.
The individual’s level of achievement in their designated job duties is also evaluated
when determining the amount of compensation paid to each executive officer.
b. Mid- to long-term performance-based stock compensation
To further incentivize contributions to the sustainable improvement of corporate value,
to ensure that executive officers share the interests of shareholders, and to further
reinforce the link between executive officer compensation and the mid- to long-term
stock price, the Company has introduced a performance-based stock compensation
program using the Board Benefit Trust system. Through the system, points are fixed after
three years based on a relative evaluation of the Company’s total shareholder return
(TSR) through a comparison with the TOPIX growth rate, the equivalent for which
Company shares are then distributed upon retirement. However, for a certain portion of
the above, NSK will compensate executive officers with the equivalent amount acquired
by converting shares into cash.
❶ Basic compensation
Basic compensation is determined based on whether the director is an outside director
or an internal director in addition to the director’s role on the Board of Directors and the
committees to which the director belongs.
❷ Stock compensation
To further incentivize contributions to the sustainable improvement of corporate value and to
ensure that directors share the interests of shareholders, the Company has introduced a stock
compensation program using a Board Benefit Trust system. The system distributes Company
shares upon retirement based on points allocated each fiscal year, of which separate amounts are
given for outside and internal directors. However, for a certain portion of the above, the Company
will compensate directors with the equivalent amount acquired by converting shares into cash.
For directors who also serve as executive officers, stock-based compensation will not be
provided for the director position.
Directors/Officers’ Compensation
Policy on Determining Compensation for Directors and Executive Officers
Amount of Compensation for Directors and Executive Officers
As a Company with Three Committees (Nomination, Audit, and Compensation), NSK makes
decisions on the structure of executive compensation, compensation levels, and individual
compensation, etc., at meetings of the Compensation Committee chaired by an outside
director, and based on advice from external consultants as well as objective information on
compensation levels and trends at other companies.
The Company will determine compensation for director and executive officer positions
separately. When a director also serves as an executive officer, the total of each respective
compensation amount shall be paid. For directors who also serve as executive officers, stock-
based compensation will not be provided for the director position.
4
6
❶ Basic compensation
❷ Performance-based compensation
a.Short-term performance-
based compensation
b.Mid- to long-term performance-
based stock compensation
Executive Offi cer Compensation Package
Notes: 1. The amount of compensation for directors and executive officers between April 1, 2023, and March 31, 2024. 2. Compensation (excluding stock
compensation) for directors (internal) includes compensation for directors who also serve as executive officers. 3. The amount of performance-based
compensation is the planned amount to be paid on July 1, 2024, based on the results for the fiscal year ended March 31, 2024. 4. The amount of stock
compensation is the amount recorded as expenses for the current fiscal year. 5. Figures listed above are rounded down to the nearest one million yen.
Classification
Compensation,
etc., Total
(¥ Millions)
Basic Compensation
Short-Term Performance-
Based Compensation
Stock Compensation
No. of Directors/
Officers
Amount
(¥ Millions)
No. of Directors/
Officers
Amount
(¥ Millions)
No. of Directors/
Officers
Amount
(¥ Millions)
Directors (internal)
120
5
101
－
－
3
18
Directors (outside)
88
6
70
－
－
6
18
Executive Officers
982
18
540
16
74
24
368
Compensation Total by Classifi cation of Directors/Executive Offi cers and Compensation
Type and Number of Directors/Offi cers
3. Other
In addition, in the event a member of the management team of another company such as a
subsidiary or an affiliate, etc., assumes an executive officer position, compensation will be
determined separately.
Name
Consolidated
Compensation, etc.,
Total (¥ Millions)
Title
Company
Amount for Each Item of Consolidated Compensation, etc. (¥ Millions)
Basic
Compensation
Short-Term Performance-
Based Compensation
Stock
Compensation
Retirement
Benefit
Akitoshi Ichii
126
Director
NSK LTD.
9
－
－
－
Executive officer
NSK LTD.
50
10
57
－
Guoping Yu
107
President
Consolidated Subsidiary NSK
(CHINA) INVESTMENT CO., LTD.
85
17
3
－
Ulrich Nass
128
President
Consolidated Subsidiary NSK
EUROPE LTD.
80
40
3
4
Brian Parsons
306
President
Consolidated Subsidiary
NSK AMERICAS, INC.
99
156
3
47
Notes: 1. The amount of compensation for directors and executive officers between April 1, 2023, and March 31, 2024. 2. Only
individuals receiving ¥100 million or more in total compensation are listed.
Amount of Consolidated Compensation for Directors and Executive Offi cers
NSK REPORT
2024
65
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Management’s risk
recognition
Risk assessment
Top-down
Bottom-up
Each business site of the Group
[Dedicated Risk Management Division]
Business Division HQ and
Functional Division HQ
Operating Committee Meeting
Consideration of risk level
Determination
of Group-Wide
Level Risks
Severity
Likelihood of
occurrence
Impact
CEO/CFO
Instructions
Report
Instructions
Report
[Risk Management Oversight Division]
Corporate Planning Division HQ
[Internal Audit Division]
Internal Audit Department
Audit
[Dedicated Risk Management Division]
Business Division HQ and Functional Division HQ
Report
Report
Report
Report
Instructions
Instructions
Instructions
Instructions
Actions
Monitoring
Monitoring
Monitoring
Monitoring
Actions
Actions
Actions
Domestic Business Sites
Regional Headquarters
Overseas Business Sites
Group-wide
level risks
Headquarters
level risks
On-site
level risks
Stratification
Three Lines of
Defense
First line
Business sites (bases and headquarters) that take concrete actions in response to risks and incidents
Second line
Dedicated Risk Management Division, Risk Management Oversight Division
Third line
Internal Audit Division
Corporate Governance
06
Risk Management
NSK conducts risk management based on clearly stipulated fundamental principles
aimed at effectively enabling the Group global management and internal control
functions; however, to further increase the effectiveness of risk management, starting
from FY2024, NSK introduced a new Enterprise Risk Management (ERM) framework
setting out more clearly the “Three Lines of Defense” approach.
Key pillars for operation of the new framework are the introduction of risk
stratification and enhancement of potential risk management. In terms of stratification,
based on management’s risk recognition and instructions, risks identified through
group-wide risk assessments were divided into three categories: group-wide level risk,
headquarters-level risk, and on-site level risk, and responsibility for addressing each
risk was clarified. The Operating Committee determines group-wide material risks
based on consideration of their severity in addition to an evaluation of likelihood of
occurrence and impact and reports them to the Board of Directors. In addition, for
each risk identified in accordance with the new risk classification, we are required to
determine countermeasures from the viewpoints of avoiding, mitigating, diverting,
or accepting risk and to seek more effective prevention through more thoroughgoing
implementation of the cycle of taking and reporting such actions, and monitoring and
giving instructions. At the same time, we adopt a system where, in the event of an
incident, the Dedicated Risk Management Division (Business Division Headquarters
or Functional Division Headquarters) in charge of managing the relevant risk seeks
to mitigate the impact by working with the affected business site to take prompt and
appropriate steps and assumes responsibility until the incident is over.
In addition, the internal audit division (Internal Audit Department) checks the ERM
system framework and reports its findings to the Audit Committee.
Determination of Group-Wide Level Risks
Enterprise Risk Management (ERM) System
NSK REPORT
2024
66
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Risk Item
Details of Representative Risks
Countermeasures
1
Risks associated
with technological
innovation
● Risk of delayed development response to market changes and customer
technology demands brought on by technological innovation
● Ensure development plan management and operation based on mid- to long-term policies
● Leverage open innovation and alliances
▶ PP.18‒19, PP.30‒31
2
Risks associated with
safety, prevention of fire,
and natural disasters
● Risk of operations being impacted by an inadequate BCP response to events
such as a natural disaster or pandemic
● Risk of a major industrial accident occurring
● Risk of a halt in operations due to a fire
● Prioritize through impact analysis and specify and implement concrete countermeasures
● Strengthen management systems and step up preventive activities at priority business sites
● Enhance group-wide in-house training activities
▶ P.39, P.53
3
Risks associated with
quality
● Risk of occurrence of serious quality problems
● Risk of decline in capability to deal with problems due to shortcoming in
quality assurance system
● Risk of quality data fraud and falsification
● Strengthen countermeasures based on analysis of past incidents
● Mitigate impact in the event of a problem through the introduction of a group-wide
traceability system
● Enhance information sharing and quality audit activities, and strengthen training
▶ P.40
4
Risks associated with
the environment
● Risk that delayed measures to reduce energy use in the long term will lead
to lost business opportunities and damage to corporate value
● Risk of a leak of environmentally harmful substances or overrun of emission
standards
● Implement investment plan based on cycle for achieving energy reduction targets
● Strengthen management systems and step up preventive activities at priority
business sites
▶ PP.42‒49
5
Risks associated with
compliance
● Risk of delayed response to changes in various laws and regulations
● Risk of our products being used by users of concern under security export
controls
● Risk of shortcomings in our responsiveness to global taxation issues
● Information sharing, and education and training through the Group compliance system
● Step up initiatives based on the Three Lines of Defense, thoroughly implement customer
management and conduct regular audits
● Strengthen tax management system including increasing resources to deal with
international taxation and sharing data and risks between parent company and
subsidiaries
▶ P.50, P.79
6
Risks associated with
human resources and
labor
● Risk of being unable to secure the globally competent human resources
needed to expand business and implement strategies
● Risk of being too slow to embrace diverse work styles and review personnel
systems and measures accordingly
● Risk of disruption to business operations as a result of failure to comply with
each country’s labor laws and regulations
● Strengthen recruitment process and enhance succession planning according to the status
of businesses and capabilities under the condition of each country and region
● Formulate and implement measures and action plans within the Group based on
engagement surveys and step up awareness-raising activities
● Engage in information exchange and monitoring with the Human Resource division of each
region around the world on a regular basis and collaborate with external experts
▶ PP.34‒37
7
Risks associated with
procurement
● Risk of disruption to procurement due to overreliance on specific suppliers
● Consider alternatives, have more than one supplier, and encourage local procurement
▶ P.41
8
Risks associated with
DX and information
security
● Risk of delivery delays and rising costs in connection with the introduction
of core systems
● Information security risks such as cyber attacks and the leakage of
confidential information
● Tighten project management and establish a rigorous review process for additional
development
● Well scheduled system updates, and conduct vulnerability assessments on a regular basis
● Improve ability of early detection and coping skills, and strengthen prompt
recovery capability
▶ P.52
9
Risks associated with
mid- to long-term
improvement in
corporate value
● Risk that unexpected changes in the business environment prevent
achievement of the mid-term management plan
● Risk that inadequate dialogue with stakeholders, including shareholders,
investors, employees, and others, impacts improvement in corporate value
or external evaluations
● Monitor achievement of the plan and formulate and implement new countermeasures in
the event any negative changes occurred
● Increase engagement activities with all stakeholders and improve
disclosures and communication
▶ P.13, PP.20‒29, P.86
Representative Risks and Countermeasures
NSK REPORT
2024
67
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Apr. 1984 Joined the Company
Feb. 2011 Deputy Head of Industrial
Machinery Business Division HQ
Jun. 2011 Executive Officer
Jun. 2013 Director (current),
Senior Vice President,
Head of Corporate Planning
Division HQ,
Responsible for IR & CSR Offices
Jun. 2015 Representative,
Executive Vice President,
Member of the Compensation Committee,
President’s Assistant,
Responsible for Administrative
Divisions, Responsible for Asia,
Head of Corporate Strategy Division HQ
Jun. 2017 Chief Financial Officer
Apr. 2019 Senior Executive Vice President
Jun. 2021 Member of the Compensation Committee
Jun. 2023 Chair of the Board of Directors (current)
Significant concurrent positions outside the Company:
Outside Director of Yasuda Logistics Corporation
Saimon Nogami
Apr. 1986 Joined the Company
Dec. 2008 Deputy Head of Automotive
Bearings Division HQ
(Automotive Business Division HQ)
Jun. 2012 Head of Operations in India
Jun. 2015 Executive Officer, Deputy Head of
Corporate Planning Division HQ
Jun. 2016 Head of Corporate Planning
Division HQ, Responsible for Asia
Apr. 2017 Senior Vice President
Jun. 2017 Director (current)
Apr. 2019 Representative (current),
Executive Vice President, President’s
Assistant, Responsible for Administrative
Divisions, Responsible for IR Office
Jun. 2019 Member of the Compensation
Committee
Apr. 2020 Responsible for Europe and the
Americas
Apr. 2021 President and Chief Executive Officer (current)
Jun. 2021 Member of the Nomination
Committee (current)
Akitoshi Ichii
Apr. 1987 Joined the Company
Jun. 2015 Senior Manager of Group Financial
Control Department
(Finance Division HQ)
Apr. 2018 Executive Officer,
Deputy Head of Finance Division HQ
Apr. 2019 Deputy Head of Corporate Planning
Division HQ
Apr. 2020 Senior Vice President,
Head of Finance Division HQ
Apr. 2023 Representative,
Executive Vice President,
Chief Financial Officer (current)
Jun. 2023 Director (current),
Member of the Compensation
Committee (current)
Keita Suzuki
Director
Representative, Executive Vice
President, Chief Financial Officer
Years as Director at NSK Ltd.
1
Company Shares Owned
25,483
Director
Years as Director at NSK Ltd.
11
Company Shares Owned
71,700
Director, Representative,
President and Chief Executive
Officer
Years as Director at NSK Ltd.
7
Company Shares Owned
79,561
Apr. 1986 Joined the Company
Jun. 2013 Head of Consolidated Accounting
Department (Finance Division HQ)
Jun. 2015 Executive Officer, Deputy Head of
Finance Division HQ, Deputy
Head of IR & CSR Offices
Jun. 2016 Deputy Head of IR Office
Apr. 2018 Senior Vice President,
Responsible for ASEAN Operations
Apr. 2021 Executive Advisor
Jun. 2021 Director (current),
Member of the Audit Committee
(current)
Kenichi Yamana
Director
Years as Director at NSK Ltd.
3
Company Shares Owned
22,479
Apr. 1972 Joined Maeda Corporation
Nov. 2003 General Manager of Corporate Planning
Department of Business Administration
Division of Maeda Corporation
Jan. 2005 Executive Officer of Maeda Corporation
Jan. 2007 Deputy General Manager of Procurement
Division of Maeda Corporation
Jun. 2007 Director of Maeda Corporation
Nov. 2007 General Manager of Procurement
Division of Maeda Corporation
Jun. 2008 Managing Officer, General Manager of
Business Administration Division of
Maeda Corporation
Apr. 2009 President and Representative
Director of Maeda Corporation
Apr. 2016 Chairman and Representative
Director of Maeda Corporation
Apr. 2019 Senior Advisor and Representative
Director of Maeda Corporation
Jun. 2019 Senior Advisor of Maeda Corporation
Apr. 2020 Senior Corporate Advisor of
Maeda Corporation
Jun. 2021 Director (current), Member of the
Compensation Committee (current)
Jul. 2021 Consultant of Maeda Corporation (current)
Jun. 2024 Member of the Audit Committee (current)
Significant concurrent positions outside the Company:
Consultant of Maeda Corporation
Koichi Obara
Outside Director,
Independent Director
Years as Director at NSK Ltd.
3
Company Shares Owned
2,000
Mar. 1976 Joined Yaskawa Electric Mfg. Co., Ltd.
(current Yaskawa Electric Corporation)
Jun. 1998 Executive Vice President of
Yaskawa Electric America, Inc.
Aug. 2003 Marketing Manager, Drives Division, Motion Control
Division of Yaskawa Electric Corporation
Mar. 2004 General Manager, Drives Division, Motion
Control Division of Yaskawa Electric Corporation
Jun. 2005 Director/Member of the Board, General Manager,
Drives Division, Motion Control Division of
Yaskawa Electric Corporation
Mar. 2006 Director/Member of the Board, General Manager,
Drives Division of Yaskawa Electric Corporation
Mar. 2007 Director/Member of the Board,
General Manager, Robotics Division of
Yaskawa Electric Corporation
Jun. 2009 Managing Director/Member of the Board,
General Manager, Robotics Division of
Yaskawa Electric Corporation
Mar. 2010 President/Member of the Board (Representative
Director) of Yaskawa Electric Corporation
Mar. 2013 Representative Director Chairman of the Board/
President of Yaskawa Electric Corporation
Mar. 2016 Representative Director Chairman of
the Board of Yaskawa Electric Corporation
Mar. 2022 Director of Yaskawa Electric Corporation
May 2022 Senior Advisor of Yaskawa Electric
Corporation (current)
Jun. 2022 Director (current), Member of the
Nomination Committee
Jun. 2023 Chair of the Nomination Committee (current)
Significant concurrent positions outside the Company:
Senior Advisor of Yaskawa Electric Corporation
Outside Director of TOTO LTD.
Junji Tsuda
Outside Director,
Independent Director
Years as Director at NSK Ltd.
2
Company Shares Owned
2,500
N
N
C
： Nomination Committee
： Compensation Committee
A ： Audit Committee
： Chairperson
★
Corporate Governance
06
Management
C
Directors (As of June 27, 2024)
A
C
A
N ★
NSK REPORT
2024
68
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Mar. 1976 Joined Tohmatsu Awoki & Co.
(current Deloitte Touche Tohmatsu LLC)
Mar. 1979 Registered as a Certified Public
Accountant
Jul. 1995 Partner, Tohmatsu & Co.
(current Deloitte Touche Tohmatsu LLC)
Jan. 2015 Member, Information and
Communications Council,
Ministry of Internal Affairs and
Communications
Jul. 2016 Retired Deloitte Touche Tohmatsu
LLC
Aug. 2016 Established Izumoto Certified
Public Accountant Office (current)
Apr. 2017 Member of Information Disclosure
and Personal Information Protection
Review Board, Ministry of Internal
Affairs and Communications
Jun. 2022 Director (current),
Chair of the Audit Committee (current)
Significant concurrent positions outside the Company:
External Audit and Supervisory Board Member of
Freund Corporation
Outside Director of TOKYO KEIKI INC.
Sayoko Izumoto
Outside Director,
Independent Director
Years as Director at NSK Ltd.
2
Company Shares Owned
0
Apr. 1977 Joined Komatsu Ltd.
Jun. 2001 General Manager of Corporate
Controlling Department of
Komatsu Ltd.
Apr. 2005 Executive Officer of Komatsu Ltd.
Apr. 2008 Executive Officer, President of
Global Retail Finance Business
Division of Komatsu Ltd.
Feb. 2009 Executive Officer,
General Manager of Corporate
Planning Division, President of
Global Retail Finance Business
Division of Komatsu Ltd.
Apr. 2010 Senior Executive Officer of
Komatsu Ltd.
Apr. 2011 CFO of Komatsu Ltd.
Jun. 2011 Director and Senior Executive Officer
of Komatsu Ltd.
Apr. 2013 Director and Senior Executive Officer
of Komatsu Ltd.
Apr. 2016 Executive Vice President and
Representative Director of Komatsu Ltd.
Apr. 2019 Director of Komatsu Ltd.
(retired in June 2019)
Jun. 2023 Director of NSK Ltd. (current),
Member of the Nomination
Committee (current)
Significant concurrent positions outside the Company:
Outside Director of Yamaha Corporation
Mikio Fujitsuka
Outside Director,
Independent Director
Years as Director at NSK Ltd.
1
Company Shares Owned
0
Apr. 1980 Joined The Fuji Bank, Ltd.
Apr. 2007 Executive Officer, General Manager of
Corporate Banking Department 13 of
Mizuho Corporate Bank, Ltd.
Apr. 2009 Managing Executive Officer,
responsible for Corporate Banking
Division of Mizuho Corporate Bank, Ltd.
Jun. 2011 Director, Executive Managing Officer
responsible for International Banking
Unit of Mizuho Corporate Bank, Ltd.
Apr. 2013 Deputy President & Executive Officer,
responsible for International Unit of
Mizuho Financial Group, Inc.
Deputy President & Executive Officer,
responsible for liaison with International
Unit of MHBC, Mizuho Bank, Ltd.
Deputy President, responsible for
International Unit of Mizuho Corporate
Bank, Ltd.
Jun. 2013 Member of the Board,
Deputy President, responsible for
International Unit of
Mizuho Financial Group, Inc.
Jul. 2013 Deputy President, responsible for
International Unit of Mizuho Bank, Ltd.
Apr. 2014 President & CEO of Mizuho Bank, Ltd.
Apr. 2017 Chairman of the Board of
Mizuho Bank, Ltd.
Apr. 2019 Senior Advisor of Mizuho Bank, Ltd.
Apr. 2023 Advisor of Mizuho Financial Group,
Inc. (current)
Jun. 2024 Director (current),
Chair of the Compensation
Committee (current)
Significant concurrent positions outside the Company:
Advisor of Mizuho Financial Group, Inc.
Outside Company Auditor of JTB Corp.
External Audit & Supervisory Board Member of
TOBU RAILWAY CO., LTD.
Nobuhide Hayashi
Outside Director,
Independent Director
Years as Director at NSK Ltd.
New appointment
Company Shares Owned
0
★
Akitoshi Ichii
President and Chief Executive Officer
Keita Suzuki
Representative Executive Vice President
Tomoyuki Yoshikiyo
Hideki Ochiai
Hayato Omi
Executive Vice Presidents
Vice Presidents
Tamami Murata
Ulrich Nass
Brian Parsons
Senior Vice Presidents
Kunihiko Akashi
Guoping Yu
Hiromichi Takemura
Tatsufumi Soda
Michio Ozaki
Hidenori Oka
Shinji Miyata
Naoki Goto
Tatsuki Murata
Gen Murayama
Hideaki Hayami
Takeshi Kihara
Group Officers
Minoru Arai
Masami Shinomoto
Jong-Won Lee
Narihito Otake
2. As of June 27, 2024 (number of the Company’s shares owned as of March 31, 2024)
Notes:
1. For such information as the reasons behind the appointments of each director and the
independence of independent directors, please see the Notice of the FY2024 (the 163rd) Ordinary
General Meeting of Shareholders of NSK and Independent Directors/Auditors Notifications.
Notice of the Ordinary General
Meeting of Shareholders ▶
Independent Directors/
Auditors Notifications
(Japanese only)▶
Executive Officers and Group Officers (As of June 27, 2024)
A ★
N
C
NSK REPORT
2024
69
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
NSK Ltd. and Consolidated Subsidiaries
JP-GAAP
IFRS
(Year)
FY2013
FY2014
FY2015
FY2016
FY2017
FY2018
FY2019
FY2020
FY2021
FY2022
FY2023
Financial
Data
Sales
871,742
974,885
975,319
949,170
1,020,338
991,365
831,034
747,559
865,166
776,762
788,867
[By segment]
Industrial Machinery Business
242,969
276,361
243,395
226,924
266,249
269,974
284,426
275,226
352,226
385,103
344,846
Automotive Business
590,545
656,998
705,511
696,271
723,564
689,658
521,857
449,722
482,547
359,374
408,821
Others/Adjustments
38,226
41,525
26,411
25,974
30,524
31,732
24,750
22,611
30,393
32,284
35,200
［By region]
Japan
329,136
328,837
318,434
330,512
372,134
367,537
314,281
275,777
317,612
268,222
271,096
(Based on customer location) The Americas
134,483
164,821
183,652
165,177
155,498
157,581
139,249
107,829
125,094
130,811
144,405
Europe
124,590
133,752
131,830
121,920
137,856
130,127
110,075
94,800
111,890
103,650
108,051
Asia (excluding Japan)
283,532
347,475
341,403
331,559
354,849
336,119
267,427
269,153
310,569
274,077
265,313
China
167,239
210,237
204,361
201,185
212,097
194,994
148,525
166,660
182,036
163,155
154,236
Other Asia
116,293
137,238
137,042
130,373
142,752
141,124
118,902
102,492
128,532
110,922
111,077
Operating income
68,049
97,327
89,534
65,341
97,875
79,279
23,604
6,364
29,430
43,836
27,391
Ordinary income
66,785
91,002
ー
ー
ー
ー
ー
ー
ー
ー
ー
Net income attributable to owners of the parent
31,167
61,962
65,719
45,560
69,312
55,809
17,412
355
16,587
18,412
8,502
Capital expenditures
45,448
49,197
54,996
58,602
68,788
81,102
54,927
37,303
52,311
54,092
58,478
Depreciation and amortization
35,079
38,568
43,048
43,354
46,785
48,801
53,926
54,527
56,558
50,112
52,907
R&D expenses
9,919
10,660
11,155
13,858
17,059
19,023
18,265
16,820
19,175
15,380
15,602
Net cash provided by operating activities (A)
70,342
67,709
108,622
67,936
83,746
92,617
72,387
53,842
22,733
64,163
99,818
Net cash used in investing activities (B)
（42,402）（46,335）（45,212）（54,243）（53,001）（72,673）（39,784）（51,096）（19,973）（48,778）
(90,814)
Free cash flows (A) + (B)
27,940
21,374
63,410
13,692
30,744
19,943
32,602
2,745
2,759
15,384
9,004
*
1
*
2
*
3
*
5
(¥ Millions)
Data Section
07
Financial Highlights
NSK REPORT
2024
70
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Dividends paid
8,650
15,161
18,425
20,174
21,245
20,737
15,550
10,367
12,958
15,638
14,888
Acquisition of treasury shares
ー
ー
ー
14,999
ー
19,999
ー
ー
ー
ー
21,717
Total equity attributable to owners of the
parent (Shareholders’ equity)
359,201
456,046
454,661
461,350
537,175
536,676
505,505
554,516
617,800
616,213
659,979
Total assets
1,000,932
1,129,164
1,032,374
1,043,955
1,092,310
1,086,456
1,029,884
1,171,699
1,234,551
1,233,256
1,298,077
Interest-bearing debt
315,532
326,400
278,152
267,399
250,908
274,780
279,170
332,440
303,457
335,738
318,945
Per Share
Data
(Yen)
Earnings (Net income)
57.70
114.56
121.38
86.08
131.16
107.46
34.00
0.69
32.35
35.89
17.27
Equity attributable to owners of the
parent (Shareholders’ equity)
664.74
842.69
839.56
873.11
1,016.30
1,048.18
987.01
1,081.88
1,204.63
1,200.92
1,350.52
Cash dividends
16.0
28.0
34.0
38.0
40.0
40.0
30.0
20.0
25.0
30.0
30.0
Financial
Indices
Operating income margin (%)
7.8
10.0
9.2
6.9
9.6
8.0
2.8
0.9
3.4
5.6
3.5
Return on average shareholders’ equity (ROE) (%)
9.2
15.3
14.3
9.9
13.9
10.4
3.3
0.1
2.8
3.0
1.3
Return on average assets (ROA) (%)
3.3
5.8
6.1
4.4
6.5
5.1
1.6
0.0
1.4
1.5
0.7
Ratio of equity attributable to owners of
the parent to total assets (%)
35.9
40.4
44.0
44.2
49.2
49.4
49.1
47.3
50.0
50.0
50.8
Net D/E ratio (Times)
0.41
0.31
0.23
0.28
0.22
0.27
0.28
0.28
0.27
0.29
0.26
Dividend payout ratio (%)
27.7
24.4
28.0
44.1
30.5
37.2
88.2
2,885.8
77.3
83.6
173.8
Dividend on equity (DOE) (%)
2.5
3.7
4.0
4.4
4.2
3.9
2.9
1.9
2.2
2.5
2.4
Period-end share price (Yen)
1,062
1,758
1,030
1,592
1,426
1,037
694
1,135
736
756
884
Price earnings ratio (PER) (Times)
18.4
15.3
8.5
18.5
10.9
9.7
20.4
1,644.9
22.8
21.1
51.2
Price book-value ratio (PBR) (Times)
1.6
2.1
1.2
1.8
1.4
1.0
0.7
1.0
0.6
0.6
0.7
Dividend yield (%)
1.5
1.6
3.3
2.4
2.8
3.9
4.3
1.8
3.4
4.0
3.4
Exchange
Rate Data
(Period
average)
Yen/US dollar
100.24
109.93
120.14
108.42
110.86
110.91
108.75
106.06
112.38
135.48
144.62
Yen/Euro
134.37
138.77
132.58
118.84
129.70
128.40
120.83
123.70
130.56
140.97
156.79
*
4
*1 In accordance with segment changes in the business domains (part of operations transferred from the Industrial
Machinery Business to the Automotive Business) in FY2016, data from FY2015 to FY2017 are presented under the
changed categories.
*2 In accordance with segment changes in the business domains (part of operations transferred from the Automotive Business to
the Industrial Machinery Business) in FY2020, data from FY2019 onward are presented under the new categories.
*3 In accordance with segment changes in the business domains (part of operations transferred from others to the Industrial
Machinery Business) in FY2022, data from FY2021 onward is presented under the new categories.
*4 The breakdown of the ¥38.0 per share dividend paid in FY2016 is a normal dividend of ¥28.0 per share and a ¥10.0 per
share dividend to commemorate the 100th anniversary of the Company’s founding.
*5 In accordance with the reclassification of the Steering Business as discontinued operations starting from the first quarter
of FY2023, the figures for FY2022 have also been restated to conform to this presentation. (The figures presented for
sales, operating income, capital expenditures, depreciation and amortization, and R&D expenses are figures excluding
the discontinued operations. Net income attributable to owners of the parent and earnings per share are the combined
total figures for continuing and discontinued operations.)
NSK REPORT
2024
71
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
0
40
80
120
160
200
（％）
(Yen)
0
10
20
30
40
50
FY2020
FY2022 FY2023
FY2021
FY2019
88.2
88.2
2,885.8
77.3
77.3
83.6
83.6
173.8
34.0
0.7
32.4
20.0
30.0
25.0
35.9
30.0
17.3
30.0
■ Earnings per Share (left) ■ Cash Dividend per Share (left)
Dividend Payout Ratio (right)
(¥ Billions)
0
20
40
60
80
FY2020
FY2022 FY2023
FY2021
FY2019
50.1
54.1
■ Capital Expenditures ■ Depreciation and Amortization
52.3
56.6
54.953.9
37.3
54.5
52.9
58.5
（％）
(¥ Billions)
0
100
200
300
400
500
0
10
20
30
40
50
60
FY2020
FY2022 FY2023
FY2021
FY2019
49.1
47.3
50.0
279.2
332.4
303.5
50.0
50.8
335.7
■ Interest-Bearing Debt (left)
Ratio of Equity Attributable to Owners of
the Parent to Total Assets (right)
318.9
Capital Expenditures/Depreciation and Amortization
Earnings per Share/Cash Dividend per Share/
Dividend Payout Ratio
Interest-Bearing Debt/Ratio of Equity Attributable to
Owners of the Parent to Total Assets
Sales
(¥ Billions)
0
200
400
600
800
1,000
1,200
831.0
747.6
865.2
788.9
776.8
FY2020
FY2022 FY2023
FY2021
FY2019
（％）
0
5
10
15
20
25
FY2020
FY2022 FY2023
FY2021
FY2019
18.5
16.9
19.6
22.6
2.8
0.9
3.4
5.6
Operating Income Margin
Gross Profit Margin
20.9
3.5
（％）
(¥ Billions)
0
10
20
30
0
2
4
6
FY2020
FY2022 FY2023
FY2021
FY2019
3.3
0.1
2.8
17.4
0.4
16.6
1.3
3.0
8.5
18.4
■ Net Income Attributable to Owners of the Parent (left)
ROE (right)
Net Income Attributable to Owners of the Parent/ROE
Operating Income Margin/Gross Profi t Margin
Data Section
07
Financial Highlights
Trends in Major Indices
* In accordance with the reclassification of the Steering Business as discontinued operations starting from the first quarter of FY2023, the figures for FY2022 have also been restated to conform to
this presentation. (The figures presented for sales, operating income margin, gross profit margin, capital expenditures, and depreciation and amortization are figures excluding the discontinued
operations. Net income attributable to owners of the parent and earnings per share are the combined total figures for continuing and discontinued operations.)
NSK REPORT
2024
72
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Scope
Unit
FY2019
FY2020
FY2021
FY2022
FY2023
Environment Environmental management system
Coverage of ISO 14001 certified sites
NSK Group
%
95% or more
95% or more
95% or more
95% or more
95% or more
Compliance with environmental laws
Number of serious violations of environmental regulations
NSK Group
Incidents
0
0
0
0
0
Environmental accidents
Number of serious incidents of environmental pollution
NSK Group
Incidents
0
0
0
0
0
Environmentally friendly products
Number of products developed (cumulative)
NSK Group
Products
232
238
239
243
246
Products that help reduce CO2 emissions
CO2 emissions avoided (total)
NSK Group
×10
3 t-CO2
1,456
2,252
2,288
2,296
2,435
Energy
Total energy usage
NSK Group
TJ
7,330
6,845
7,524
6,413
6,394
Fuel and gas
NSK Group
TJ
2,295
2,079
2,229
1,867
1,837
Electricity and heat
NSK Group
TJ
5,035
4,767
5,295
4,546
4,557
Rate of renewable energy use
NSK Group
%
2.2
6.7
8.3
21.5
34.5
Greenhouse gases
GHG emissions (total for Scope 1 and 2)
NSK Group
×10
3 t-CO2e
839
701
763
528
448
Scope 1
NSK Group
×10
3 t-CO2e
132
120
127
107
102
Scope 2 (on a market basis)
NSK Group
×10
3 t-CO2e
708
581
636
421
346
Scope 3
NSK Group
×10
3 t-CO2e
2,194
1,928
2,199
1,831
2,232
Steel
Steel consumption
NSK Group
×10
3 t
618
562
655
525
554
Water
Total water withdrawal
NSK Group
×10
3m
3
4,308
3,977
4,169
3,619
3,652
Groundwater
NSK Group
×10
3m
3
1,789
1,659
1,826
1,540
1,380
General water
NSK Group
×10
3m
3
2,028
1,922
1,978
1,754
1,985
Industrial water
NSK Group
×10
3m
3
490
396
357
318
284
Rainwater and reused water
NSK Group
×10
3m
3
ー
ー
8
7
3
Waste and valuables
Total waste and valuables
NSK Group
×10
3 t
201.8
181.9
203.1
165.0
165.7
Reuse and recycle (excluding energy recovery)
NSK Group
×10
3 t
171.8
156.3
174.7
140.0
142.9
Total waste disposed (including energy recovery)
NSK Group
×10
3 t
30.0
25.6
28.4
25.0
22.8
Landfilled
NSK Group
×10
3 t
2.9
2.1
2.4
1.5
1.2
Incinerated with energy recovery
NSK Group
×10
3 t
11.8
10.3
10.7
8.6
8.1
Incinerated without energy recovery
NSK Group
×10
3 t
4.0
3.3
3.9
2.9
2.8
Other disposal (e.g., water treatment)
NSK Group
×10
3 t
11.3
9.9
11.4
12.0
10.7
Air quality
Emissions of NOx
NSK Group
t
119
106
113
91
78
Emissions of SOx
NSK Group
t
38
39
33
32
3
Water quality
Total discharged water
NSK Group
×10
3m
3
2,847
2,519
2,757
2,290
2,261
Rivers
NSK Group
×10
3m
3
591
575
646
537
550
Sewage system
NSK Group
×10
3m
3
2,256
1,944
2,110
1,753
1,711
BOD (biochemical oxygen demand)
NSK Group
t
1.2
1.2
1.5
0.9
0.9
Environmentally harmful substances
Handling of PRTR-designated
substances (materials and parts)
Group in Japan
t
395
316
326
259
264
Discharge/transfer of PRTR-designated substances
Group in Japan
t
78
73
86
73
86
Emissions of VOCs
NSK Group
t
145
141
165
139
137
Biodiversity
Number of biodiversity conservation initiatives
(social contribution initiatives)
Group in Japan
Initiatives
6
3
5
9
9
*
1
*
2
*
2
*
2
*
2
*
3
*
2
*
2
*
4
*
2
*
2
*
2
*
2*
5
*
2
*
2*
5
*
2
*
2*
5
*
6
*
2
*
2
*
2
*
2*
5
*
2
*
2*
5
*
2
*
2*
5
*
2
*
2*
5
*
7
*
2
*
2
*
2
*
2*
5
*
2
*
2*
5
*
2
*
2*
5
*
2
*
2*
5
*
2
*
2*
5
*
2
*
2*
5
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2
*
2*
5
*
2
*
2
PRTR Act
The PRTR Act stands for the Pollutant Release and Transfer Register Act and refers to the Act on Confirmation, etc., of
Release Amounts of Specific Chemical Substances in the Environment and Promotion of Improvements to the Management
Thereof. This is a Japanese law intended to encourage the improvement of chemical substance management by requiring
that the amounts of chemical substances released to the environment are reported to the authorities.
Definition
VOCs
VOCs stands for Volatile Organic Compounds. VOCs are one cause of photochemical smog.
*1 Percentage of environmental impact for ISO 14001 certified sites compared to the total environmental impact of the
entire NSK Group, including greenhouse gas and waste emissions.
*2 Effective the first quarter of FY2023, the steering business has been classified as discontinued operations. The data
exclude the discontinued operations.
*3 Until FY2007, newly developed products that are consistent with the “Basic Policy for the Development of Environmentally Friendly
Products” and, from FY2008, newly developed products with an NSK Eco-efficiency indicators (Neco) score of 1.2 or higher.
*4 Amount of CO2 emissions avoided in the past financial years are recalculated using the latest CO2 emission factor of
electricity used in the calculation of CO2 emissions avoided for FY2023.
*5 Third-party verification has been obtained.
*6 Rate of renewable energy use = Energy use from renewable sources / energy use
*7 Procurement volume from main suppliers
▶ P.87
Data Section
07
Non-Financial Highlights
NSK REPORT
2024
73
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Scope
Unit
FY2019
FY2020
FY2021
FY2022
FY2023
Social
Number of employees (consolidated)
Total
NSK Group
Persons
30,747
30,378
30,577
29,882
25,632
Japan
Group in Japan
Persons
11,803
11,774
11,853
11,728
10,474
The Americas
Group in the
Americas
Persons
2,804
2,617
2,696
2,622
2,130
Europe
Group in Europe
Persons
4,206
4,333
4,312
4,070
3,338
Asia
Group in Asia
Persons
11,934
11,654
11,716
11,462
9,690
Employee composition by gender
Men
NSK Group
％
81.0
81.7
81.9
81.6
80.9
Women
NSK Group
％
19.0
18.3
18.1
18.4
19.1
Average years of employment (average age)
Total
Group in Japan
Years (age)
17 (42)
17 (42)
17 (43)
17 (42)
17 (42)
Men
Group in Japan
Years (age)
17 (42)
18 (43)
17 (43)
18 (42)
17 (42)
Women
Group in Japan
Years (age)
12 (37)
12 (38)
12 (38)
13 (38)
14 (38)
Localization rate for key global posts
NSK Group
％
－
－
－
73
72
Percentage of employees taking childcare leave
(based on NSK criteria)
Men
NSK
%
－
50.3
56.5
72.6
83.3
Women
NSK
%
－
100.0
100.0
100.0
100.0
Employment rate of people with disabilities
Group in Japan
％
2.24
2.45
2.56
2.48
2.62
Occupational safety
Lost-time injury frequency rate
NSK Group
－
0.35
0.43
0.28
0.39
0.28
Fatal accidents
NSK Group
Accidents
0
0
0
0
0
Health and wellness
Percentage of employees participating in the
Specific Health Guidance program
NSK
％
25.1
27.3
27.2
26.3
24.3
Percentage of employees receiving stress checks
NSK
％
94.9
95.9
97.9
98.7
99.2
Percentage of employees who smoke
NSK
％
36.6
33.8
31.9
31.6
31.1
Human resource development
Number of participants in NSK Japan Management College/
NSK Global Management College
NSK Group
Persons
22
10
10
22
9
Ratio of Japan/Global Management College
graduates among executives
NSK
％
－
－
75
71
65
Number of participants in NSK Institute of Technology
NSK Group
Persons
527
518
493
495
539
Number of training hours per year
NSK Group
Hours
－
21
19
21
23
Rate of labor union participation
Non-management employees
Group in Japan
％
100
100
100
100
100
All employees including managers
Group in Japan
％
83
83
84
84
86
Employee engagement survey
Number of participants (officers and employees)
NSK Group
Persons
14,964
16,985
5,976
20,611
6,397
Engagement Score
NSK Group
－
65
67
67
68
69
Research and development
Number of patents held
NSK Group
Patents
8,052
8,172
6,226
3,794
3,999
*
1
*
1
*
1
*
1
*
1
*
1
*
1
*
2
*
1
*
2
*
1
*
2
*
1
*
2
*
1
*
1*
3
*
1
*
1
*
4
*
4
*
4
※1
*
1
*
2
*
1
*
2
*
1
*
5
*
6
*
1
*
1
Non-Financial Highlights
*1 Effective the first quarter of FY2023, the steering business has been classified as discontinued operations. The data
exclude the discontinued operations.
*2 NSK Ltd. and main Group companies in Japan
*3 The Company receives third-party assurances.
*4 Scope was changed to NSK Ltd. from FY2023. Scope prior to FY2023 was NSK Ltd. and main Group companies in Japan.
*5 Some surveys were postponed due to the COVID-19 pandemic.
*6 The survey is conducted every two years in each geographical region, and the countries surveyed differ each year. The score
is a moving average calculated as a weighted average of the survey results for the relevant and previous fiscal years.
▶ P.87
Data Section
07
NSK REPORT
2024
74
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
As of June 30
Unit
2020/6
2021/6
2022/6
2023/6
2024/6
Governance Composition of the Board of Directors
Number of directors
Persons
9
9
9
9
9
Ratio of independent outside directors
％
55.6
55.6
55.6
55.6
55.6
Ratio of males
％
88.9
88.9
88.9
88.9
88.9
Ratio of females
％
11.1
11.1
11.1
11.1
11.1
Unit
FY2019
FY2020
FY2021
FY2022
FY2023
Attendance at Board of Directors meetings Number of times convened
Meetings
10
10
10
10
10
Average attendance rate
％
99
98
100
98
99
Average attendance rate of independent outside directors
％
98
98
100
96
98
Scope
Unit
FY2019
FY2020
FY2021
FY2022
FY2023
Compliance hotline
Number of consultations and reports
NSK Group
Incidents
175
178
168
147
131
Serious legal violations, incidents/accidents
Number of occurrences
NSK Group
Incidents
0
0
0
0
0
Competition law training
Number of participants*
3
NSK Group
Persons
2,867
5,481
7,588
12,486
9,446
Compliance training
(Topics related to NSK Code of
Corporate Ethics）
Number of participants
Group in Japan
Persons
－
－
－
16,545
16,877
Employee engagement survey
Compliance awareness score*
4
NSK Group
－
58.7
63.2
63.3
69.8
71.9
*
1*
2
*
1
*
1
*
1
Note: The global lost time injury frequency rate including the discontinued
operations was 0.38 in FY2022 and 0.24 in FY2023.
(Patents)
0
2,000
4,000
6,000
8,000
10,000
8,052
8,172
6,226
3,794＊3,999＊
FY2020
FY2022 FY2023
FY2021
FY2019
Number of Patents Held
0
0.2
0.4
0.6
0.8
0.35
0.43
0.28
0.39＊
0.28＊
FY2020
FY2022 FY2023
FY2021
FY2019
Lost-Time Injury Frequency Rate
Number of Employees Worldwide/Ratio of Overseas Employees
(Persons)
0
10,000
20,000
30,000
40,000
（％）
0
25
50
75
100
61.6
61.2
61.2
60.8
59.1
30,747
30,378
30,577
29,882
■ Japan ■ The Americas ■ Europe ■ Asia (left)
Ratio of Overseas Employees (right)
FY2020
FY2022 FY2023
FY2021
FY2019
25,632＊
▶ P.39 Safety Management
Trends in Major Indices
* Effective the first quarter of FY2023, the steering business has been classified as discontinued operations. The data exclude the discontinued operations.
*1 Effective the first quarter of FY2023, the steering business has been classified as discontinued operations. The data
exclude the discontinued operations.
*2 The data has been updated retrospectively.
*3 Includes e-learning participants, since FY2020.
*4 The survey is conducted every two years in each geographical region, and the countries surveyed differ each year. The
score is a moving average calculated as a weighted average of the survey results for the relevant and previous fiscal years.
Note: To set itself apart from competitors and enhance the competitiveness of its
products and services, NSK submits patent applications on an ongoing basis for
any technological outcomes it produces. As a result of reorganizing patents with
a low potential for future use, the number of patents held decreased in FY2021.
The number of patents held including the discontinued operations was 6,306 in
FY2022 and 6,696 in FY2023.
NSK REPORT
2024
75
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Consolidated Statements of Financial Position (IFRS)
FY2022
(March 31, 2023)
FY2023
(March 31, 2024)
Assets
Current assets
Cash and cash equivalents
160,109
150,583
Trade receivables and other
receivables
207,812
220,248
Inventories
197,754
185,886
Other fi nancial assets
1,590
45,076
Income tax receivables
1,633
4,988
Other current assets
18,756
18,196
Subtotal
587,656
624,979
Assets related to disposal groups
classifi ed as held for sale
－
11,643
Total current assets
587,656
636,623
Non-current assets Property, plant and equipment
385,613
364,947
Goodwill and intangible assets
49,227
56,548
Investments accounted for
using equity method
30,699
49,605
Other fi nancial assets
56,425
51,932
Deferred tax assets
15,288
10,309
Net defi ned benefi t assets
101,165
121,589
Other non-current assets
7,179
6,521
Total non-current assets
645,600
661,454
Total assets
1,233,256
1,298,077
FY2022
(March 31, 2023)
FY2023
(March 31, 2024)
Liabilities and equity
Liabilities
Current liabilities Trade payables and other payables
112,535
140,451
Other fi nancial liabilities
129,801
128,433
Provisions
536
469
Income tax payables
7,797
25,835
Other current liabilities
56,678
52,583
Subtotal
307,348
347,774
Liabilities related to disposal
groups classifi ed as held for sale
－
11,370
Total current liabilities
307,348
359,145
Non-current liabilities Financial liabilities
231,309
214,864
Provisions
1,867
1,065
Deferred tax liabilities
32,661
21,890
Net defi ned benefi t liabilities
16,027
13,582
Other non-current liabilities
9,318
9,574
Total non-current liabilities
291,183
260,977
Total liabilities
598,532
620,123
Equity
Issued capital
67,176
67,176
Capital surplus
80,476
77,897
Retained earnings
415,736
375,402
Treasury shares
(36,781)
(10,422)
Other components of equity
89,604
150,270
Other components of equity related to
disposal groups classifi ed as held for sale
－
(345)
Total equity attributable to
owners of the parent
616,213
659,979
Non-controlling interests
18,511
17,975
Total equity
634,724
677,954
Total liabilities and equity
1,233,256
1,298,077
(¥ Millions)
(¥ Millions)
Data Section
07
Consolidated
Financial Statements
* In accordance with the reclassification of the Steering Business as discontinued operations starting from the first quarter of FY2023, the figures for FY2022 have also been restated to conform to this presentation. (The figures
presented for sales, share of profits of investments accounted for using the equity method, operating income, and income before income taxes are figures excluding the discontinued operations. Net income, net income
attributable to owners of the parent, total comprehensive income for the period, basic earnings per share, and diluted earnings per share are the combined total figures for continuing and discontinued operations.)
* NSK lost control of NSK Steering & Control, Inc. (NS&C), which globally manages the steering business, on August 1, 2023, and, from the second quarter of FY2023, NS&C and its subsidiaries became equity-method affiliates
of NSK. The profit and loss related to the loss of control is included in discontinued operations, and the share of profit (loss) of investments accounted for using the equity method is included in continuing operations.
* The assets, liabilities, and other components of equity of the Steering Business have been categorized as disposal groups classified as held for sale.
NSK REPORT
2024
76
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Consolidated Statements of Income (IFRS)
Consolidated Statements of Comprehensive Income (IFRS)
(¥ Millions)
FY2022
From April 1, 2022,
to March 31, 2023
FY2023
From April 1, 2023,
to March 31, 2024
Sales
776,762
788,867
Cost of sales
601,047
623,618
Gross profi t
175,715
165,249
Selling, general and administrative expenses
134,631
140,921
Share of profi ts of investments accounted
for using the equity method
3,196
4,377
Other operating expenses
442
1,313
Operating income
43,836
27,391
Financial income
2,301
3,632
Financial expenses
2,855
4,813
Income before income taxes
43,282
26,210
Income tax expense
15,265
11,955
Net income from continuing operations
28,017
14,254
Income (loss) from discontinued operations
(9,355)
(4,689)
Net income
18,661
9,564
Net income attributable to:
Owners of the parent
18,412
8,502
Non-controlling interests
249
1,062
(Earnings per share attributable to owners of the parent)
Basic earnings (loss) per share (Yen)
35.89
17.27
Continuing operations
52.26
27.47
Discontinued operations
(16.37)
(10.20)
Diluted earnings (loss) per share (Yen)
35.77
17.20
Continuing operations
52.08
27.37
Discontinued operations
(16.32)
(10.16)
FY2022
(From April 1, 2022, to March 31, 2023)
FY2023
(From April 1, 2023, to March 31, 2024)
Incurred in
the period
Reclassifi cation
adjustment
Before
Tax Effect
Tax
Effect
Amount
(net)
Incurred in
the period
Reclassifi cation
adjustment
Before
Tax
Effect
Tax
Effect
Amount
(net)
Net income
18,661
9,564
Other comprehensive
income
Items that will not be
reclassifi ed to profi t or loss
Remeasurements of net
defi ned benefi t liability
(asset)
(24,255)
－(24,255)
9,768
(14,486) 48,854
－
48,854
(18,371) 30,482
Net changes in fi nancial
assets measured at fair
value through other
comprehensive income
(5,550)
－
(5,550)
1,711
(3,839) 14,224
－
14,224
(4,338)
9,886
Share of other
comprehensive income
of investments accounted
for using equity method
(329)
－
(329)
96
(232)
1,093
－
1,093
(141)
952
Total items that will not be
reclassifi ed to profi t or loss (30,135)
－(30,135) 11,576
(18,558) 64,172
－
64,172 (22,851) 41,321
Items that may be
reclassifi ed to profi t or loss
Exchange differences
on translating foreign
operations
13,774
－
13,774
－
13,774
33,892
(6,273) 27,618
1,479
29,097
Cash fl ow hedges
－
－
－
－
－
(215)
－
(215)
53
(161)
Share of other
comprehensive income of
investments accounted for
using equity method
169
－
169
－
169
1,406
－
1,406
－
1,406
Total items that may be
reclassifi ed to profi t or loss
13,943
－
13,943
－
13,943
35,082
(6,273) 28,809
1,532
30,342
Total other
comprehensive income (16,192)
－(16,192) 11,576
(4,615) 99,255
(6,273) 92,982 (21,318) 71,663
Total comprehensive
income for the period
14,046
81,228
Total comprehensive income
for the period attributable to:
Owners of the parent
13,449
80,147
Non-controlling interests
597
1,081
(¥ Millions)
NSK REPORT
2024
77
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
(¥ Millions)
Equity Attributable to Owners of the Parent
Non-
Controlling
Interests
Total
Equity
Issued
Capital
Capital
Surplus
Retained
Earnings
Treasury
Shares
Other Components of Equity
Other components of equity
related to disposal groups
classifi ed as held for sale
Total
FY2022 (From April 1, 2022 to March 31, 2023)
Exchange differences
on translating
foreign operations
Cash fl ow
hedges
Net changes in fi nancial assets
measured at fair value through
other comprehensive income
Remeasurements of
net defi ned benefi t
liability (asset)
Total
Opening balance
67,176
80,374
410,872
(37,025)
25,316
－
27,460
43,625
96,402
－
617,800
19,659
637,460
Net income
－
－
18,412
－
－
－
－
－
－
－
18,412
249
18,661
Other comprehensive income
－
－
－
－
13,606
－
(3,809)
(14,759)
(4,962)
－
(4,962)
347
(4,615)
Total comprehensive income for the period
－
－
18,412
－
13,606
－
(3,809)
(14,759)
(4,962)
－
13,449
597
14,046
Purchase of treasury shares
－
－
－
(8)
－
－
－
－
－
－
(8)
－
(8)
Disposal of treasury shares
－
28
－
252
－
－
－
－
－
－
280
－
280
Share-based payment transactions
－
74
－
－
－
－
－
－
－
－
74
－
74
Cash dividends
－
－
(15,403)
－
－
－
－
－
－
－
(15,403)
(1,744)
(17,148)
Other
－
－
1,855
－
－
－
(1,835)
－
(1,835)
－
20
－
20
Total transactions with owners, etc.
－
102
(13,548)
243
－
－
(1,835)
－
(1,835)
－
(15,037)
(1,744)
(16,782)
Closing balance
67,176
80,476
415,736
(36,781)
38,922
－
21,816
28,865
89,604
－
616,213
18,511
634,724
(¥ Millions)
Equity Attributable to Owners of the Parent
Non-
Controlling
Interests
Total
Equity
Issued
Capital
Capital
Surplus
Retained
Earnings
Treasury
Shares
Other Components of Equity
Other components of equity
related to disposal groups
classifi ed as held for sale
Total
FY2023 (From April 1, 2023, to March 31, 2024)
Exchange differences
on translating
foreign operations
Cash fl ow
hedges
Net changes in fi nancial assets
measured at fair value through
other comprehensive income
Remeasurements of
net defi ned benefi t
liability (asset)
Total
Opening balance
67,176
80,476
415,736
(36,781)
38,922
－
21,816
28,865
89,604
－
616,213
18,511
634,724
Net income
－
－
8,502
－
－
－
－
－
－
－
8,502
1,062
9,564
Other comprehensive income
－
－
－
－
30,486
(161)
9,935
31,384
71,644
－
71,644
19
71,663
Total comprehensive income for the period
－
－
8,502
－
30,486
(161)
9,935
31,384
71,644
－
80,147
1,081
81,228
Purchase of treasury shares
－
－
－
(21,727)
－
－
－
－
－
－
(21,727)
－
(21,727)
Disposal of treasury shares
－
(70)
－
545
－
－
－
－
－
－
475
－
475
Retirement of treasury shares
－
(47,540)
－
47,540
－
－
－
－
－
－
－
－
－
Share-based payment transactions
－
(128)
－
－
－
－
－
－
－
－
(128)
－
(128)
Cash dividends
－
－
(15,040)
－
－
－
－
－
－
－
(15,040)
(1,372)
(16,413)
Transfer from retained earnings to capital surplus
－
45,160
(45,160)
－
－
－
－
－
－
－
－
－
－
Changes due to loss of control of subsidiaries
－
－
－
－
－
－
－
－
－
－
－
(244)
(244)
Transfer from other components of equity to
retained earnings
－
－
11,324
－
－
－
(11,004)
(320)
(11,324)
－
－
－
－
Transfer to other components of equity related
to disposal groups classifi ed as held for sale
－
－
－
－
345
－
－
－
345
(345)
－
－
－
Other
－
－
40
－
－
－
－
－
－
－
40
－
40
Total transactions with owners, etc.
－
(2,579)
(48,836)
26,358
345
－
(11,004)
(320)
(10,978)
(345)
(36,381)
(1,616)
(37,998)
Closing balance
67,176
77,897
375,402
(10,422)
69,754
(161)
20,747
59,929
150,270
(345)
659,979
17,975
677,954
Consolidated Statements of Changes in Equity (IFRS)
Data Section
07
Consolidated Financial Statements
NSK REPORT
2024
78
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
FY2022
From April 1, 2022,
to March 31, 2023
FY2023
From April 1, 2023,
to March 31, 2024
Net cash provided by operating activities
Income before income taxes
43,282
26,210
Income (loss) before income taxes from
discontinued operations
(11,356)
(2,986)
Depreciation and amortization
58,376
54,121
Increase (decrease) in net defi ned benefi t
liability and net defi ned benefi t asset
(3,056)
27,955
Interest and dividend income
(1,987)
(3,140)
Interest expenses
3,726
5,794
Share of profi ts of investments accounted
for using the equity method
(3,196)
(4,377)
Decrease (increase) in trade receivables
5,100
4,816
Decrease (increase) in inventories
6,330
4,016
Increase (decrease) in trade payables
(10,130)
12,235
Other
(3,926)
4,610
Subtotal
83,161
129,255
Interest and dividend received
5,122
5,520
Interest expenses paid
(3,670)
(5,818)
Income tax paid
(20,449)
(29,139)
Net cash provided by operating activities
64,163
99,818
Investing activities
Purchases of property, plant and equipment
(44,292)
(49,933)
Proceeds from sale of property, plant and equipment
302
309
Purchases of intangible assets
(7,457)
(8,764)
Purchases of other fi nancial assets
(118)
(100,096)
Proceeds from sale of other fi nancial assets
3,348
17,971
Proceeds from redemption of other fi nancial assets
－
59,999
Payments for sale of investments in subsidiaries
resulting in change in scope of consolidation
－
(10,917)
Other
(561)
616
Net cash used in investing activities
(48,778)
(90,814)
FY2022
From April 1, 2022,
to March 31, 2023
FY2023
From April 1, 2023,
to March 31, 2024
Financial activities
Increase (decrease) in short-term loans
(8,065)
(22,196)
Proceeds from long-term loans
16,409
70,677
Repayments of long-term loans
(14,436)
(30,052)
Proceeds from issuance of corporate bonds
43,000
15,000
Payments for redemption of corporate bonds
(10,000)
(15,000)
Repayments of lease liabilities
(5,636)
(5,556)
Acquisition of treasury shares
(1)
(21,717)
Dividends paid
(15,386)
(15,037)
Dividends paid to non-controlling interests
(1,744)
(1,372)
Other
280
475
Net cash used in fi nancial activities
4,417
(24,780)
Effect of exchange rate changes on cash and
cash equivalents
2,801
6,257
Net increase (decrease) in cash and cash equivalents
22,604
(9,519)
Cash and cash equivalents at the beginning of the period
137,504
160,109
Cash and cash equivalents included in assets related
to disposal groups classifi ed as held for sale
－
(6)
Cash and cash equivalents at the end of the period
160,109
150,583
Consolidated Statements of Cash Flows (IFRS)
(¥ Millions)
(¥ Millions)
Please see our website for more information. ▶
As the globalization of business advances, the NSK Group believes that the
proper payment of taxes in the countries and regions where it operates is one
of the most fundamental and important social responsibilities that it should
undertake. With this understanding, the Group has established the NSK Group
Tax Policy and is striving to ensure appropriate tax treatment. For more details,
please visit the website noted below.
NSK Group Tax Policy
NSK REPORT
2024
79
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
As of March 31, 2024
Region
Company Name
Consolidated
Equity
Outline of Business
Japan
NSK MICRO PRECISION CO., LTD.
NSK MICRO PRECISION CO., LTD.
(NAGANO)
AMATSUJI STEEL BALL MFG. CO., LTD.
AKS EAST JAPAN CO., LTD.
NSK KYUSHU CO., LTD.
ASAHI SEIKI CO., LTD.
SHINWA SEIKO CO., LTD.
NSK TOYAMA CO., LTD.
NSK MACHINERY CO., LTD.
KURIBAYASHI SEISAKUSHO CO., LTD.
NSK REAL ESTATE CO., LTD.
NISSEI BLDG. MANAGEMENT LTD.
NSK HUMAN RESOURCE SERVICES LTD.
NSK LOGISTICS CO., LTD.
NSK NETWORK AND SYSTEMS CO., LTD.
NSK-CHUGAI, LTD.
NSK-WARNER K.K.
NSK STEERING & CONTROL, INC.
INOUE JIKUUKE KOGYO CO., LTD.
55.0%
100.0%
100.0%
100.0%
100.0%
74.3%
82.4%
100.0%
100.0%
73.5%
100.0%
70.0%
100.0%
100.0%
100.0%
65.0%
50.0%
49.9%
40.0%
Manufacture and sales of industrial
machinery bearings, etc.
Manufacture of industrial machinery
bearings, etc.
Manufacture and sales of steel balls
Manufacture of steel balls
Manufacture of precision machinery &
parts
Manufacture of industrial machinery
bearing parts, etc.
Manufacture of industrial machinery
bearing parts, etc.
Manufacture of industrial machinery
bearing parts
Manufacture of machine tools, etc.
Manufacture and sales of
automotive bearing parts
Real estate management and rental,
etc.
Management of Nissei Building
Consignment services for salary and welfare
Distribution service
Design and development for
computer systems, etc.
Sales of electrical components and
insurance agent, etc.
Manufacture and sales of
automotive-related products
Sales, design, and development of
automotive components, control of
subsidiaries and affi liates
Manufacture and sales of industrial
machinery bearings
THE AMERICAS
U.S.A.
NSK AMERICAS, INC.
NSK CORPORATION
NSK PRECISION AMERICA, INC.
100.0%
100.0%
100.0%
Control of American subsidiaries
and affi liates
Manufacture and sales of
automotive bearings, etc.
Manufacture and sales of precision
machinery & parts
Region
Company Name
Consolidated
Equity
Outline of Business
U.S.A.
NSK LATIN AMERICA, INC.
NSK-AKS PRECISION BALL COMPANY
BK VIBRO AMERICA INC.
100.0%
100.0%
100.0%
Sales of industrial machinery
bearings, etc.
Manufacture and sales of steel balls
Manufacture of condition monitoring
equipment and sale and provision of
condition monitoring services
Canada
NSK CANADA INC.
100.0%
Sales of industrial machinery
bearings, etc.
Mexico
NSK RODAMIENTOS MEXICANA,
S.A. DE C.V.
NSK BEARINGS MANUFACTURING,
MEXICO, S.A. DE C.V.
AKS PRECSION BALL MEXICO S.A.
DE C.V.
100.0%
100.0%
100.0%
Sales of industrial machinery
bearings, etc.
Manufacture of automotive
bearings, etc.
Manufacture and sales of steel balls
Brazil
NSK BRASIL LTDA.
100.0%
Manufacture and sales of industrial
machinery bearings, etc.
Argentina
NSK ARGENTINA S.R.L.
100.0%
Sales of industrial machinery
bearings, etc.
Peru
NSK PERU S.A.C.
100.0%
Sales support of industrial
machinery bearings, etc.
EUROPE
U.K.
NSK EUROPE LTD.
NSK BEARINGS EUROPE LTD.
NSK PRECISION UK LTD.
NSK UK LTD.
NSK STEERING SYSTEMS EUROPE LTD.
AKS PRECISION BALL EUROPE LTD.
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
Control of European subsidiaries
and affi liates
Manufacture of automotive bearings, etc.
Manufacture of precision machinery & parts
Sales of industrial machinery bearings, etc.
Manufacture of automotive components
Manufacture and sales of steel balls
Germany
NSK EUROPA HOLDING GMBH
NSK DEUTSCHLAND GMBH
NEUWEG FERTIGUNG GMBH
BRÜEL & KJÆR VIBRO GMBH
100.0%
100.0%
100.0%
100.0%
Holding company of subsidiaries in Germany
Sales of industrial machinery
bearings, etc.
Manufacture of industrial machinery
bearings
Manufacture of condition monitoring
equipment and sale and provision of
condition monitoring services
Data Section
07
Major NSK Group Companies
NSK REPORT
2024
80
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Region
Company Name
Consolidated
Equity
Outline of Business
France
NSK FRANCE S.A.S.
100.0%
Sales of industrial machinery
bearings, etc.
Italy
NSK ITALIA S.P.A.
100.0%
Sales of industrial machinery
bearings, etc.
Spain
NSK SPAIN S.A.
100.0%
Sales of industrial machinery
bearings, etc.
Netherlands
NSK EUROPEAN DISTRIBUTION
CENTRE B.V.
100.0%
Distribution service
Poland
NSK BEARINGS POLSKA S.A.
NSK POLSKA SP. Z O.O.
NSK NEEDLE BEARING POLAND SP. Z O.O.
AKS PRECISION BALL POLSKA SP. Z O.O.
95.5%
100.0%
100.0%
100.0%
Manufacture of industrial machinery
bearings, etc.
Sales of industrial machinery
bearings, etc.
Manufacture of automotive bearings
Manufacture and sales of steel balls
Denmark
BRÜEL & KJÆR VIBRO A/S
100.0%
Development of condition
monitoring equipment
Turkey
NSK RULMANLARI ORTA DOGU TIC.
LTD. STI (NSK BEARINGS MIDDLE
EAST TRADING CO., LTD.)
100.0%
Sales of industrial machinery
bearings, etc.
South Africa
NSK SOUTH AFRICA (PTY) LTD.
100.0%
Sales of industrial machinery
bearings, etc.
ASIA
China
NSK (CHINA) INVESTMENT CO., LTD.
KUNSHAN NSK CO., LTD.
NSK DONGGUAN AUTOMOTIVE
TECHNOLOGY CO., LTD.
ZHANGJIAGANG NSK PRECISION
MACHINERY CO., LTD.
CHANGSHU NSK NEEDLE BEARING CO., LTD.
AKS PRECISION BALL
(HANGZHOU) CO., LTD.
SUZHOU NSK BEARINGS CO., LTD.
NSK (CHINA) RESEARCH AND
DEVELOPMENT CO., LTD.
SHENYANG NSK PRECISION CO., LTD.
SHENYANG NSK CO., LTD.
100.0%
85.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
Control of Chinese subsidiaries and
affi liates, sales of bearings, etc.
Manufacture of automotive
bearings, etc.
Manufacture of automotive-related
products
Manufacture of automotive bearing
parts, etc.
Manufacture of automotive bearings
Manufacture and sales of steel balls
Manufacture of automotive bearings
Research and development of
automotive bearings, etc.
Manufacture of precision machinery &
parts
Manufacture of industrial machinery
bearings
Region
Company Name
Consolidated
Equity
Outline of Business
China
HEFEI NSK CO., LTD.
TOHSHIN-NSK ROLLERS (SUZHOU)
CO., LTD.
100.0%
40.0%
Manufacture of industrial machinery
bearings, etc.
Manufacture of automotive bearing
parts
Hong Kong
NSK HONG KONG LTD.
70.0%
Sales of industrial machinery
bearings, etc.
Taiwan
TAIWAN NSK PRECISION CO., LTD.
70.0%
Sales of precision machinery & parts
Singapore
NSK INTERNATIONAL
(SINGAPORE) PTE LTD.
100.0%
Control of ASEAN and OCEANIA
subsidiaries and affi liates
Indonesia
PT. NSK BEARINGS
MANUFACTURING INDONESIA
PT. NSK INDONESIA
PT. AKS PRECISION BALL INDONESIA
100.0%
100.0%
100.0%
Manufacture of industrial machinery
bearings, etc.
Sales of industrial machinery
bearings, etc.
Manufacture and sales of steel balls
Thailand
NSK BEARINGS MANUFACTURING
(THAILAND) CO., LTD.
NSK ASIA PACIFIC TECHNOLOGY
CENTRE (THAILAND) CO., LTD.
NSK BEARINGS (THAILAND) CO.,
LTD
74.9%
100.0%
49.0%
Manufacture and
sales of automotive bearings
Development of products, etc.
Sales of industrial machinery
bearings, etc.
Malaysia
NSK BEARINGS (MALAYSIA) SDN.
BHD.
NSK MICRO PRECISION (M) SDN.
BHD.
ISC MICRO PRECISION SDN. BHD.
51.0%
100.0%
100.0%
Sales of industrial machinery
bearings, etc.
Manufacture of industrial machinery
bearings, etc.
Manufacture of industrial machinery
bearings, etc.
Vietnam
NSK VIETNAM CO., LTD.
100.0%
Sales of industrial machinery
bearings, etc.
Australia
NSK AUSTRALIA PTY. LTD.
100.0%
Sales of industrial machinery
bearings, etc.
New Zealand
NSK NEW ZEALAND LIMITED
100.0%
Sales of industrial machinery
bearings, etc.
India
NSK BEARINGS INDIA PRIVATE
LIMITED
ANE NSK STEERING SYSTEMS
PRIVATE LTD.
100.0%
51.0%
Manufacture and sales of
automotive bearings, etc.
Manufacture and sales of
automotive components
South Korea
NSK KOREA CO., LTD.
100.0%
Manufacture and sales of
automotive bearings, etc.
NSK REPORT
2024
81
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Turning
Heat treatment
process
Outer ring
heat
treatment
Inner ring
heat
treatment
Process into a ring shape by turning or forging and turn the raceway
and the inner surface of the rings (both outer and inner rings).
Imparts
hardness and
toughness
Outer ring
materials
Raceway,
chamfer
processing
Forging
Heating
Cutting
Outer ring
Due roll
Outer ring
Inner ring
Inner ring
Outer
ring
Inner
ring
Hole punching
Outer and inner rings separation
Rolling (CRF)
Turning
Inner ring
materials
Shipping
Completion/packaging processes
Assembly process
After washing, we assemble balls, inner
and outer rings, insert the retainer, and
carry out riveting.
After injecting grease and sealing it in seals
(shields), we perform a total inspection and
pack in accordance with customer requirements.
To customers,
keeping to
delivery dates
Inner
ring
washing
Outer
ring
washing
Grinding process
Grinding both side surfaces, the outer surfaces, the raceway surfaces,
and the inner surfaces, etc., of the outer and inner rings will create precision.
The superfinishing of the raceway is carried out to reduce surface roughness.
We also inspect the bearings from various angles at each process and ensure
quality requirements
Face
grinding
Outer surface
grinding
Raceway
grinding
Superfinishing
Inner
surface
grinding
Inner ring
raceway
grinding
Inner ring
surface
grinding
Assembly
and ball
insertion
Retainers
insertion
Grease
injection
Washing
Insertion
of seals
(shields)
Completion
Packaging
Note: Pink-colored objects (example:
) show the grinding stones.
Inner ring
raceway
superfinishing
Outer ring
raceway
superfinishing
Inner ring
face grinding
Outer ring
face grinding
Outer ring
outer surface
grinding
Outer ring
raceway
grinding
Rough
machining/
cutting off
Roller Bearing
Ball Bearing
Bearings―the staple of industry. A surprisingly large number of them can be found
all around us. ▶ P.5 NSK Supporting Society
The term “bearing” incorporates the meaning of “to bear,” in the sense of “to
support.”
Bearings
Bearings also contribute to lower energy consumption by reducing friction and
allowing the efficient transmission of power. This is just one way in which bearings
are environmentally friendly.
Cage
Inner ring
Rolling
elements
[rollers]
Outer ring
Rolling
elements
[balls]
Outer ring
Cage
Inner ring
Bearings have a simple basic structure with four elements―
an outer ring, an inner ring, rolling elements, and a cage.
Structure
Scan here to
view a video. ▶
Main manufacturing processes for bearings:
Machine will run
more efficiently
1
Extend the
operating life
of machinery
2
Preventing abrasion
burn and avoiding
mechanical breakdown
3
Bearings work to reduce friction in the rotational motion of machines. The three
main benefits of reducing friction are as follows.
With bearings:
Data Section
07
Basic Knowledge of NSK Products
NSK REPORT
2024
82
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Heat treatment, grinding process
Turning
Assembly process
Completion/packaging processes
Shipping
Grinding process
Turning
Heat treatment
Screw shaft
Nut
Material
cutting
Cutting before
heat treatment
Material cutting
Outer diameter
cutting
Inner diameter
cutting
Ball groove
cutting
Heat treatment
Laser marking
Outer diameter
grinding
Ball groove
grinding
Heat
treatment
Shaft end
cutting
Shafts and nuts,
balls, circular
components, etc.,
are fed into the
assembly process
Ball insertion
To customers,
keeping to
delivery dates
Cylinder
grinding
Ball groove
grinding
Washing/process inspection
Washing/process inspection
Degas packaging
after grease application
Note: Pink-colored objects (example: ) show the grinding stones.
Measurement/
inspection/washing
Packaging
Scan here to
view a video. ▶
A ball screw is a component that combines the characteristics of a low-friction
mechanism using balls based on the bearing principle with those of a screw
mechanism. These items are widely used as components mainly in machine tools,
various types of robots, FA, OA equipment, semiconductor-related equipment,
industrial machinery, and medical-related equipment.
When the shaft turns, the ball in the nut rolls and the nut moves straight in the
direction of the shaft. The ball in the nut is a rolling contact, so it can change the
rotating force of a motor, etc., into a liner motion without wasting energy.
Structure
Movement image
Ball
Screw
shaft
Nut
Ball recirculation mechanism of ball screw
(return tube type)
Ball Screws
Precise positioning for use in machine tools and the machining machine parts.
Precise positioning utilizing
extremely accurate motion
1
Transmission of force that can generate
a large force by a small rotational force
2
A ball screw is a component that can convert rotational motion into linear motion.
Ball screws have basically two major applications.
With ball screws:
Main manufacturing processes for ball screws:
NSK REPORT
2024
83
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Term
Meaning
Bearings &
Beyond
Indicates NSK’s intention to further develop its founding
bearings business and to leverage the technology, know-how
and product strength it has built up to date to develop its
business beyond existing areas.
CMS
CMS stands for Condition Monitoring System. One
example of a CMS is a system for understanding/analyzing
the operational status of bearings (e.g., vibration, noise,
rotational torque) based on various data by bearings with
sensors installed.
Micro-UT
Method
UT stands for Ultrasonic Testing. The Micro-UT method
refers to a non-destructive testing method using ultrasonic
waves.
MRO
MRO stands for Maintenance, Repair or Replacement,
Operation. In NSK Report 2024, we make references to the
demand for maintenance and repair services of industrial
machines and equipment in the Industrial Machinery
Business.
NIT
NIT stands for NSK Institute of Technology, which is an
internal educational institute for our engineers to master
more advanced technology.
Term
Meaning
NPDS
NPDS stands for NSK Product Development System.
NPDS, NSK’s proprietary quality management system, is
geared toward promptly and reliably responding to new
projects and to the mass production of products that
satisfy customers. Being rolled out globally, at each stage
of the process, from product planning to development and
design, prototype manufacturing, and mass production,
dedicated staff perform stringent checks to confi rm that
any concerns are resolved and to build quality. Even after a
product has entered mass production, we conduct thorough
management to stably maintain high quality.
NSK Monozukuri
Center
The NSK Monozukuri Center was established in 2005 for
the purpose of passing on manufacturing related know-how
and skills and developing current and future leaders of the
shop fl oor.
Product Lifecycle
Management
(PLM)
PLM stands for Product Lifecycle Management and refers to
the management of the product life cycle. NSK is working to
expand its PLM strategy to include equipment maintenance
and repair after product sales, with the aim of strengthening
its service delivery system throughout the entire product life
cycle.
QCDDSM
QCDDSM stands for Quality, Cost, Delivery, Development,
Service, and Management. The QCDDSM elements are
generally focused on by the manufacturing industry
including NSK.
SPI Management
SPI is an acronym for Sales, Production, and Inventory, and
refers to the appropriate management and operation of
sales, production, and inventory.
Data Section
07
Glossary
NSK REPORT
2024
84
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
Term
Meaning
Actuators
Actuators refer to mechanical components that, for
example, play a role in the actuation of brakes and gear
shifting of automobiles.
Aftermarket
Aftermarket refers to maintenance and repair demand. In
NSK, aftermarket mainly means the demand and business
for repair and replacement.
Environmentally
Friendly Products
Environmentally friendly products are those products
that, together with offering higher performance than
conventional products, contribute to a greater reduction of
negative environmental impact. At NSK, we emphasize the
following for product manufacturing that contributes to the
reduction of negative environmental impact:
1. Creating products that contribute to energy and resource
conservation during use by customers;
2. Creating products that minimize energy and resource use
during production;
3. Creating products that realize zero use of
environmentally harmful substances; and
4. Creating products that contribute to people’s health and
safety through low vibration, low noise, and low dust
emissions.
Global Posts
Global posts refer to important business management posts
at regional headquarters, including regional heads. Many of
these positions are fi lled by local employees, and business
expansion is led locally.
Design Quality/
Manufacturing
Quality
Design quality refers to “targeted quality” and is the quality
realized by building it in at the design stage to achieve
satisfying function and performance. Manufacturing
quality is known as “performance quality.” It is the quality
of products that have been manufactured and is realized
through management at the manufacturing stage.
Term
Meaning
Smart Factory
Smart factory in this report refers to NSK’s new concept
factory. The status of equipment and processing in each
process during manufacturing is understood with data in
real time, which is utilized for quality control, equipment
maintenance, and product traceability. The understanding
and management of big data are realized by advancements
in Information Technology (IT). The evolution of the
information of things such as IoT is the technology behind
the smart factory.
Needle Bearings
Needle bearings refer to bearings with needle-type rolling
elements. Low cross-sectional height and high load capacity
help realize space saving.
Hub Unit
Bearings
Hub unit bearing refers to a type of bearing that integrates
the part attached to the vehicle body and the part called
a hub to which the wheel is mounted. Hub unit bearings
support the vehicle body while smoothly rotating the wheels.
Powertrain
Powertrain refers to the main components that generate
power and deliver that to the drive wheel in automobiles.
Mother Plant
We position plants with outstanding capacity such as
excellent technical ability and signifi cant production capacity
as mother plants. In NSK, mother plants have the role of
transferring technology, etc., to child plants located overseas.
Megatorque
MotorTM
Megatorque Motor refers to the integration of the bearing,
motor, and sensor to produce accurate rotational motion.
The Megatorque Motor enables agile motion and smart
control.
MonocarrierTM
Monocarrier refers to a lightweight, compact single-axis
actuator with an all-in-one design integrating ball screw, linear
guide, and support bearings. NSK was the fi rst in the world to
develop its own all-in-one linear motion products.
NSK REPORT
2024
85
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
The 163nd Ordinary General
Meeting of Shareholders for
the Year Ended March 31,
2024 （held June 27, 2024)
Number of
Shareholders
Present
Ratio of Shareholder
Voting Rights
Exercised
59
83.0％
Financial conferences (large meetings)
4 times for a total of 378 companies
Individual IR interviews
Total of 266 companies
Institutional investor engagement visits
Total of 19 companies
President’s small meetings
5 times for a total of 55 people
IR road shows outside Japan (online) Europe/North America/Asia
16 companies
Conference participation for investors outside Japan
5 times for a total of 37 companies
*1 FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confi rms that NSK
has been independently assessed according to the FTSE4Good criteria, and has satisfi ed the requirements
to become a constituent of the FTSE4Good Index Series. Created by the global index provider FTSE Russell,
the FTSE4Good Index Series is designed to measure the performance of companies demonstrating strong
Environmental, Social and Governance (ESG) practices. The FTSE4Good indices are used by a wide variety of
market participants to create and assess responsible investment funds and other products.
*2 FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confi rms that NSK
has been independently assessed according to the FTSE Blossom Japan Index criteria and has satisfi ed the
requirements to become a constituent of the FTSE Blossom Japan Index. Created by the global index provider
FTSE Russell, the FTSE Blossom Japan Index is designed to measure the performance of companies demonstrating
strong Environmental, Social and Governance (ESG) practices. The FTSE Blossom Japan Index is used by a wide
variety of market participants to create and assess responsible investment funds and other products.
*3 FTSE Russell (the trading name of FTSE International Limited and Frank Russell Company) confi rms that
NSK has been independently assessed according to the FTSE Blossom Japan Sector Relative Index criteria
and has satisfi ed the requirements to become a constituent of the FTSE Blossom Japan Sector Relative
Index. Created by the global index provider FTSE Russell, the FTSE Blossom Japan Sector Relative Index
is designed to measure the performance of companies demonstrating strong Environmental, Social and
Governance (ESG) practices. FTSE Blossom Japan Sector Relative Index indices are used by a wide variety
of market participants to create and assess responsible investment funds and other products.
*4 THE INCLUSION OF NSK IN ANY MSCI INDEX, AND THE USE OF MSCI LOGOS, TRADEMARKS,
SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT
OR PROMOTION OF NSK BY MSCI OR ANY OF ITS AFFILIATES. THE MSCI INDEXES ARE THE
EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEX NAMES AND LOGOS ARE TRADEMARKS
OR SERVICE MARKS OF MSCI OR ITS AFFILIATES.
Over and above their financial aspects, companies that merit high evaluations for their
environmental and social contributions are being recognized for their promise of long-term
sustainable growth. These companies are also attracting interest from a socially responsible
investment (SRI) perspective while forging an increasingly important presence among a
wide range of institutional investors. Acknowledged for its integrity, NSK was included in
the following internationally recognized SRI/ESG indices as of July 2024.
Highly Evaluated by Outside Agencies (SRI/ESG）
*3
https://www.lseg.com/
en/ftse-russell/indices/
blossom-japan
*2
https://www.lseg.com/
en/ftse-russell/indices/
blossom-japan
https://www.spglobal.
com/esg/csa/indices/
djsi-index-family
*1
https://www.lseg.com/
en/ftse-russell/indices/
ftse4good
https://www.sompo-am.
com/
https://www.
issgovernance.com/esg/
ratings/
https://www.msci.com/
esg-integration
*4
Data Section
07
IR Activities
NSK discloses management information promptly and fairly and is actively engaged in
dialogue with shareholders and investors. In addition, the Company strives to achieve
stable shareholder returns and pursues sustainable growth together with higher corporate
value over the mid- to long-term. In this way, we seek to continue to be a company that
meets the expectations of our stakeholders, including shareholders and investors.
General Meeting of Shareholders
Being cognizant that the General Meeting of
Shareholders is a venue for active dialogue with
shareholders, we set its date to avoid periods
concentrated with the shareholders’ meetings of other
companies (at least two days prior to such a concentrated
period) and promptly issue and post convocation notices
and reports (normally posted to our website 28 days
prior to the date of the meeting), among other efforts we
make to create favorable conditions for the meeting.
Dialogue with Institutional and Individual Investors
Various direct dialogues are held by senior management, including briefings on
financial results and mid-term management plans. In addition, constructive dialogue
(engagement) on management strategy and ESG issues is conducted annually.
As in the previous year, we held an individual investor presentation in-person and
online in FY2023. NSK actively discloses information and responds to questions,
including having a website for individual investors to learn about NSK in an easy-to-
understand manner.
NSK will continue to properly communicate its management direction, business
strategies, and other information, while striving to engage in dialogue to ensure correct
evaluation and understanding.
Number of Dialogue Opportunities in FY2023: Total of 428 Companies (excluding large meetings)
Please see our
website for NSK’s
disclosure policy. ▶
NSK REPORT
2024
86
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
At the Time of Publishing
the NSK Report 2024
Thank you very much for your understanding and support of
NSK’s business activities.
NSK Report 2024 illustrates the initiatives we have taken
as part of our ongoing effort to provide new value as we seek
to address developments in electrification, automation, and
digitalization, and to reduce environmental impact. Each of
these initiatives is based upon the strength of the deep trust
we have earned from our customers through our experience in
accumulating technologies and in supporting the development
of industry over the past 100 years.
I therefore hope that this report conveys to our stakeholders
the path we must tread to become a company that will
continue to be needed, trusted, and relied upon by society.
I would also hope that it conveys our efforts to enhance the
added value we deliver in existing business domains, as well as
to elevate profitability and capital efficiency through the challenge of new products and
new domains based on a more extensive range of core technologies, both of which fall
under the concept of Bearings & Beyond as presented in MTP2026.
This report was produced primarily by the Corporate Communications Department,
which worked in cooperation with a broad range of departments involved. As the
executive officer responsible for IR and thus the creation of this report, I declare the
process for preparing this report to be valid and the information contained herein to be
accurate. We will continue making concerted efforts to further enrich the content of this
report and look forward to hearing your honest opinions and requests after reading it.
Third-Party Assurances
As of March 31, 2024
Common Stock
Authorized
1,700,000,000 shares
Issued
500,000,000 shares
(including 3,722,952 shares of treasury stock)
Number of Shareholders
60,457
Transfer Agent
Mizuho Trust & Banking Co., Ltd.
1-3-3, Marunouchi, Chiyoda-ku, Tokyo 100-8241, Japan
Listing
Tokyo Stock Exchange Prime Market
Security Code
6471
2020
2021
2022
2024
2023
(As of March 31)
6.0
6.0
6.0
6.0
6.0
6.0
14.3
13.3
17.1
5.4
50.1
2.0
2.0
7.8
48.6
48.7
3.3
3.3
3.6
3.6
7.1
6.6
19.9
21.7
18.0
18.1
49.6
4.6
4.6
4.8
21.9
17.5
47.4
6.2
18.9
■ Financial Institutions ■ Securities Companies ■ Other Japanese Corporations
■ Foreign Investors ■ Individuals/Others ■ Treasury Stock
0.7
4.9
4.9
● Energy usage ▶ P.73
● Greenhouse gas emissions (Scope 1・Scope 2・Scope 3) ▶ P.73
● Water withdrawal ▶ P.73
● Waste and valuables ▶ P.73
● Emissions of VOCs ▶ P.73
● Lost-time injury frequency rate ▶ P.74
▶ Items Subject to Assurance
See here for our Independent Verification Report and Independent Assurance Statement. ▶
Data Section
07
Share Information
Breakdown of Shareholders (%) (by shareholder type)
Hideaki Hayami
Vice President
Head of Corporate Planning
Division HQ
Responsible for Investor
Relations
To ensure the reliability and accuracy of NSK Report 2024 as an integrated report,
NSK obtained assurances from an external third party for the data information on the
following described in this report.
NSK REPORT
2024
87
Introduction
01
01
NSK’s Value
Co-Creation Story
02
02
Mid- to Long-Term Growth
Strategies and Resource Allocation
03
03
Strengthening
Internal Capital
04
04
Sustainability
Initiatives
05
05
Corporate
Governance
06
06
Data Section
07
07
CAT. No. E8417 2024 X-12 Printed in Japan ©NSK Ltd. 2024