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Tokyo

Gas C

o.‚ Ltd

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2018TOKYO GAS GROUP

CSR REPORT

LNG

50 km150 km 100 km

Washinomiya Gas

Shoei Gas

Nagano Toshi Gas

Tokyo Gas Yamanashi

Tokyo Bay

Nagano Pref.

Saitama Pref.

静岡県

Yamanashi Pref.

Kanagawa Pref.

Tokyo

Gunma Pref.

Tochigi Pref.

Ibaraki Pref.

Chiba Pref.

Gunma Line

Joso Line

Chiba-Kashima Line

Chiba Line II

Tochigi Line

Utsunomiya Line

Saitama Line

Saihoku Line

Chiba Line

Tokyo LineYokohama

Line

Chuo Line

Waterfront Line

Submarine Line

Joso Line II

New Negishi Line

Ibaraki-Tochigi Line

Saito Line

Koga-Moka Line

Kumagaya-Sano Line

Ibaraki Line (Fiscal 2020)

Hitachi LNG Terminal

Negishi LNG Terminal Ohgishima LNG Terminal

Tokyo Gas Yokosuka PowerChiba Sodegaura Energy Co., Ltd. (under study)

Kawasaki Natural Gas Power Generation

(Fiscal 2019)

Ohgishima Power

Kobelco Power Moka

Tokyo Gas Baypower

Keihin Line

T-Power

Overseas Businesses Serving as the Backbone of Stable Energy Supply

Total length of pipelines

63,557 km(as of the end of March 2018)

Midstream and downstream business projectsUpstream business projects

1

2

745

3

8

11

Ichthys LNGPluto LNG

Gorgon LNG

LNG Vietnam

PVGDGWHAMT

PRA

Gas Malaysia

Gas Malaysia Energy Advance

Queensland Curtis LNG

Darwin LNG

Barnett Shale Gas

East TexasTight Sand and Shale Gas

Cove Point LNG

Eagle Ford Shale Gas TGES America

Bajio

EPEC

MT Falcon

Birdsboro

Empire

9 countries 22 projects

Overseas Business Expansion

MajorProjects

1 Paris Representative Office2 Hanoi Representative Office

3 Ho Chi Minh City Representative Office

4 Thailand Representative Office

5 Asia Pacific Regional Office6 Jakarta Representative Office

7 Manila Representative Office

8 Tokyo Gas Asia Pte. Ltd. (Singapore)

9 Tokyo Gas Australia Pty. Ltd. (Perth)

10 Tokyo Gas Australia Pty. Ltd. (Brisbane)11 Tokyo Gas America Ltd. (Houston)

● Main Overseas Bases

(as of the end of March 2018)

9 10

6

(as of May 1, 2018)

Sales and service network (Tokyo Gas LIFEVAL, Enesta and Enefit)

Tochigi Pref. 1Tokyo 89

Kanagawa Pref. 50

Saitama Pref. ２1Chiba Pref. 8

Gunma Pref. 8Ibaraki Pref. 8

Tokyo Gas’s wholesale service areas (city gas)The Tokyo Gas Group’s service areas (city gas)

Other companies’ high-pressure pipelines

Tokyo Gas high-pressure pipelines (existing) Tokyo Gas high-pressure pipelines (planned)

Energy Supply Network in the Tokyo Metropolitan Area

Sodegaura LNG Terminal

(as of the end of March 2018)

Contents02 Company Profile

04 Top Commitment

CSR at the Tokyo Gas Group

06 Overview of CSR Management

08 Key CSR Activities and Materiality

10 Key CSR Activities and Major Results

12 The Tokyo Gas Group’s LNG Value Chain and Key Initiatives Contributing to Sustainable Development

14 Stakeholder Engagement

Key CSR Activities

18 Key CSR Activity 1

Enhancement of Energy Security

24 Key CSR Activity 2 　Contribution to the Environment

30 Key CSR Activity 3　Contribution to Local Communities

34 Key CSR Activity 4　 Respect for Human Rights

36 Key CSR Activity 5　Promotion of Compliance

38 Key CSR Activity 6　Enhancement of People-Centered Management Base

40 Supply Chain Management

41 Corporate Governance

42 Editorial Policy

43 Third-Party Independent Assurance Report

Company Profile (as of the end of March 2018)

Established October 1, 1885

Capital 141.8 billion yen

Sales 1,777.3 billion yen (consolidated basis)

Number of Employees 17,138 (non-consolidated basis: 7,862*1)

Service Area(City Gas)

Major cities of Tokyo, Kanagawa, Saitama, Chiba, Ibaraki, Tochigi, and Gunma

Subsidiaries and Affiliates

Consolidated subsidiaries: 74Equity-method affiliates: 15

*1 Full-time employees

1885 Oct. Tokyo Gas established.

1893 Jul. Company name changed to Tokyo Gas Co., Ltd. following the enactment of the Commercial Code.

1962 Sept. Calorific value conversion completed in head office area.*2

1966 May Negishi LNG Terminal entered operation.

1969 Nov. LNG imports from Alaska commenced.

1972 Jun. Calorific value conversion to natural gas commenced.*3

1973 Jan. LNG imports from Brunei commenced.

Feb. Sodegaura LNG Terminal entered operation.

1976 Jan. Looped Line from the Negishi LNG Terminal to the Sodegaura LNG Terminal entered operation.

1977 Dec. Tokyo Bay Underwater Line entered operation.

1983 Feb. LNG imports from Malaysia commenced.

1988 Oct. Calorific value conversion to natural gas completed.

1989 Aug. LNG imports from Australia commenced.

1994 Jan. LNG imports from Indonesia commenced.

1998 Oct. Ohgishima LNG Terminal entered operation.

Dec. LNG imports from Qatar commenced.

1999 Dec. Keihin Line and Yokohama Line entered operation, connecting three LNG terminals.

2009 Apr. LNG imports from Russia commenced.

May ENE-FARM residential fuel cell goes on sale.

Oct. Establishment of Tokyo Gas LIFEVAL completed.

2010 May Chuo Line entered operation.

2012 Mar. Chiba-Kashima Line entered operation.

2015 Apr. Unconventional LNG imports from Queensland Curtis LNG Project commenced.

2016 Mar. Hitachi LNG Terminal and Ibaraki-Tochigi Line entered operation.

Apr. Sale of electricity to residential and small commercial customers commenced.

2017 Apr. Gas retail market fully liberalized.

2017 Oct. Koga-Moka Line entered operation.*2 Increased from 3,600 kcal to 5,000 kcal.

*3 Increased from 5,000 kcal to 11,000 kcal.

History of Tokyo Gas

The Tokyo Gas Group’s Energy Supply Infrastructure2018TOKYO GAS GROUP

CSR REPORT

Lines of Business

1. Production, supply, and sale of city gas2. Production, supply and sale of electricity3. Overseas upstream business, midstream and

downstream business4. Engineering solution business, liquid gas

business, LNG sales, gas appliances, gas installation work, construction, etc.

5. Leasing and management of land and buildings, etc.

6. Information processing service, shipping business, credit and leasing business, etc.

Tokyo Gas Group CSR Report 201803

Top Commitment

The business environment surrounding the Tokyo

Gas Group is changing dramatically, including the

deregulations in energy markets, a decline in the number

of households, progress in reducing carbon footprints and

saving energy, and digitalization. Committed to advancing

Group management, we accurately respond to those

changes while also continuing to expand the foundation

for the future, based on our brand values of “Safety,

Security, and Reliability,” so that the Group can progress

rapidly in the 2020s.

For over 130 years since the Tokyo Gas Group was

established in 1885, we have been contributing to society

by providing a stable supply of city gas to support the

economic development of the Tokyo metropolitan area

and enrich daily life. It has consistently sought to enhance

its corporate value as an “energy frontier corporate

group” by being the first in Japan to introduce and

propagate the use of liquefied natural gas (LNG), install

large-scale combined heat and power (CHP) systems, and

promote the development and wider use of residential

fuel cells.

In April 2017, following the deregulation of the

electricity market, the gas retail market was fully

liberalized, which transformed the business environment

at an unprecedented scale. As the energy industry faces

a major turning point, we formulated the Tokyo Gas

FY2018-2020 Medium-term management plan GPS2020

in October 2017 while anticipating the coming of an era

of natural gas, of single-source providers of electricity and

As a Tokyo 2020 Games Official Partner in the Gas

and Gas Utility Services category, we will contribute to

the success of this event as well as creating attractive

urban communities by supplying energy to the Tokyo

metropolitan area. We view the Tokyo 2020 Games as

an opportunity to create an inclusive society based on

mutual respect for one another that offers safe, vibrant

and pleasant lifestyles for everyone. We will promote

initiatives for realizing this vision while also ensuring

that they are maintained as consistent and sustainable

initiatives that will continue after the Tokyo 2020 Games.

Our corporate message of “Supporting you Always

and bettering every day” expresses our aspiration to

become a driving force behind daily life and society by

meeting challenges and taking actions to bring about a

vibrant, safe and pleasant future. To consistently fulfill this

responsibility in an ever-changing society, we will address

social needs and expectations from a global perspective

and contribute to the creation of a sustainable society.

The Tokyo Gas Group seeks to develop a sustainable

society by actively pursuing initiatives that pay due

consideration for the environment and promote smart

networks. We are particularly aware of our significant

Our corporate mission is to meet public demand and

expectations, which become more substantial every year

and are changing at an accelerating pace.

The Tokyo Gas Group engages in CSR activities under

a basic policy of steadfastly tackling the challenges faced

by society through our business activities in order to

contribute to the sustainable development of society.

In March 2016, Tokyo Gas became a signatory of

the UN Global Compact so that it could pursue CSR as a

responsible member of the international community, and

we support and practice the 10 principles in the four fields

of human rights, labor, environment, and anti-corruption.

With respect to the Sustainable Development Goals

(SDGs) adopted by the United Nations, we have sought

to align the common issues and goals of the international

community with the social responsibilities of the Tokyo

Gas Group to continue developing our CSR management

toward achieving the SDGs.

Pursuing “GPS × G” to Become a Total Energy Group that Remains the Customer’s Choice

Ensuring the Success of the Olympic and Paralympic Games Tokyo 2020

Meeting Challenges Faced by Society through Business Activities

Sustainable Development of Society

We will develop our business to a higher level and contribute to the creation of a sustainable society as a driving force in communities and daily life.

gas, and of multidimensional innovation fueled by rapid

digital evolution. We will pursue our GPS × G concept,

delivering Gas, Power, and Services that meet a variety of

needs to Global customers.

potential for contributing to a low-carbon society.

Natural gas, which constitutes the core of our

business, is an energy source that generates the lowest

CO2 emissions among fossil fuels and is expected to

continue playing a key role in addressing climate change.

We are increasing investments in renewable energy-

based power generation, such as solar and wind power,

and in future technologies. We are also constructing smart

energy networks that generate and consume energy

locally by linking heat, electricity and information networks

toward making communities more energy efficient,

environmentally friendly and resilient to disasters.

In addition, we will continue to develop technologies

to ensure the safety and security of people in their daily

lives and all of society far into the future while harnessing

IoT and AI to meet social needs.

Representative Director, President and CEOTokyo Gas Co., Ltd.

Takashi Uchida

04 05Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 2018

CSR at the Tokyo Gas Group

CSR Promotion SystemBasic Policy on CSR

Tokyo Gas Group believes that the foundation of its CSR lies in achieving its public mission and fulfilling its social responsibilities by conducting daily business activities in accordance with our Management Philosophy and Corporate Action Philosophy.

We are committed to being a corporate group that contributes to the sustainable development of society, and that continues to grow and be trusted by customers, shareholders, and society on a permanent basis as we meet the demands and expectations of society in Japan and abroad by steadfastly tackling the challenges faced by society through our business activities.

Tokyo Gas established a CSR promotion system in

October 2004 by setting up a CSR Promotion Committee

chaired by an executive officer responsible for CSR.

In December of the same year, the committee was

reorganized into the Corporate Communications

Promotion Committee under the CSR Section of the

Corporate Communications Department.

The committee, which is responsible for promoting

CSR management, consists of a chairperson and 18

general managers drawn from associated departments.

It discusses and shares information on important CSR

matters throughout the Group, including the revision of

key CSR activities, identification of materiality in light

of internal and external changes, and the status of CSR

efforts. Committee proceedings are reported to the

Corporate Executive Meeting and the Board of Directors

for deliberation and authorization as necessary.

Management Philosophy

Corporate Action Philosophy

Challenge 2020 VisionMedium-term management plan GPS2020

Departmental missions

Prom

otio

n of

CSR

Individual employees’ daily business activities

Chairman: Senior Executive Officer(an executive officer responsible for CSR)

Secretariat: Corporate Planning Dept., Corporate Communications Dept.

Boa

rd o

f Dir

ecto

rs

Pres

iden

t (Co

rpor

ate

Exec

utiv

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eetin

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Corporate Communications Promotion Committee

Gas Resources & Energy Production Div.

Pipeline Network Div.

Residential Sales and Service Div.

Energy Solution Div.

Regional Development Div.

Audit & Supervisory Board Members

Audit & Supervisory Board Members’ Office

Power Business Div.

Global Business Div.

Digital Innovation Div.

Corporate Planning Dept.

Finance Management Dept.

Accounting Dept.

Personnel Dept.

Purchasing Dept.

Secretary Dept.

General Administration Dept.

Corporate Communications Dept.

Environmental Affairs Dept.

Compliance Dept.

Internal Audit Dept.

Tokyo 2020 Olympic and Paralympic Dept.

Subsidiaries

● PDCA Cycle

CSR Management PDCA Cycle

We maintain a keen awareness of the evolving demands

and expectations of society to discern the materiality of

our CSR activities. In accordance with the direction of our

business strategy, we set CSR KPIs and pursue them in

the course of our business operations.

Progress reports on our CSR initiatives and feedback

gathered from stakeholders is then incorporated into

our business activities to continue the cycle as our

contribution to the sustainable development of society.

Overview of CSR Management The Tokyo Gas Group believes that promoting CSR is synonymous with practicing its Management Philosophy

and Corporate Action Philosophy and intends to contribute to society through its daily business activities,

thereby achieving its public mission and fulfilling its social responsibilities as an energy company.

The Tokyo Gas Group strive to achieve its public mission

and fulfill its social responsibilities through its daily business

activities as the foundation of its CSR. We also seek

to maintain the security and safety of people’s lives by

providing a stable supply of energy, which is the foundation

of daily life and industry, and to play our part in building

a sustainable society by supplying energy that excels in

terms of both environmental consideration and cost.

As for our CSR, we have identified key CSR issues, or

materiality, in accordance with standards such as the ISO

26000 international standard on social responsibility and

international guidelines on information disclosure such as

the GRI Guidelines. We signed the UN Global Compact*1

in March 2016 to add a global perspective to our CSR

activities as a responsible member of the international

community, and we will work to achieve the Sustainable

Development Goals (SDGs)*2 as we elevate our standards

of CSR management.

*1 A global framework for attaining sustainable growth that consists of 10 principles in the four areas of human rights, labor, environment, and anti-corruption.

*2 17 goals and 169 targets to be met by 2030, adopted at the UN Sustainable Development Summit in September 2015.

● The Tokyo Gas Group’s Vision of CSR Management

1. We will continue to grow while maintaining awareness of our company’s public mission and social responsibilities.

2. We will provide quality products and services, and always endeavor to improve customer satisfaction.

3. We will hold ourselves to high ethical standards, and fairly and transparently conduct corporate activities while observing both the letter and the spirit of related laws and ordinances.

4. We will contribute to alleviating global environmental problems as a leader in environmental management.

5. We will remain keenly aware of our obligations to be a good corporate citizen and work towards the betterment of society by contributing to community activities.

6. We will pursue continual innovation to promote a cost effective business approach that is both flexible and resilient.

7. We will aspire to build organizations that are based upon the full exercise of and respect for the talents, desires, and creativity of each and every employee.

As a leading energy company with focus on natural gas business, the Tokyo Gas Group shall actively contribute to create a pleasant lifestyle and environmentally friendly society, maintain and enhance its trust from our customers, shareholders, and society.

Promotion and Reinforcement of Corporate Governance

Attainment of GPS2020

Plan

Do

Check

Act

● The Tokyo Gas Group initiatives● Training and other activities for cultivating CSR awareness● Engagement with stakeholders

● Extract issues and problems and incorporate them into a plan for the next fiscal year● Share information among Tokyo Gas Group companies and departments● Review the organizational system and rules

● Identify materiality and set CSR KPIs● Formulate an annual plan at a meeting of the Corporate Communications Promotion Committee

● Monitor initiatives and analyze results● Conduct an employee satisfaction survey and analyze results

● External assessment and analyze indicators● Conduct a stakeholder dialogue

Soci

al D

eman

ds a

nd E

xpec

tatio

ns

Cont

ribu

ting

to th

e Su

stai

nabl

e D

evel

opm

ent o

f Soc

iety

Procurement and transport of LNG

Production and supply of energy

Energy solutions

(as of April 2018)

● CSR Promotion System

Pro

mot

ion

of C

ompl

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espe

ct f

or H

uman

Rig

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Con

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Loc

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ies

Con

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utio

n to

the

Env

iron

men

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nhan

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of E

nerg

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ecur

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CS

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201806 07

CSR at the Tokyo Gas Group

Key CSR Activities and Materiality

In October 2017, we formulated the Tokyo Gas Group FY2018-2020 Medium-term management plan GPS2020, which

led to identifying our new materiality. Starting in fiscal 2018, our PDCA cycles will be driven by assessing and improving

initiatives based on our new materiality.

FY2017 Key CSR Activities and Materiality

New Materiality Determined for Fiscal 2018 and Beyond

Provide stable supplies of energy in Japan and abroad

Construct a robust energy platform

Reduce carbon for society as a whole through energy supply

● Stable supply of gas and electricity ● Stable procurement of LNG● Construction of energy infrastructure in developing countries

● Safety and disaster prevention● Development of sustainable communities

● Climate change countermeasures● Resource saving and recycling ● Biodiversity conservation

● Creation of a lively organization ● Sound stakeholder relationships● Achievement of our public mission as an energy company

Strategy

Foundation

Governance　　Compliance

Materiality

The Tokyo Gas Group sets targets for each materiality of its CSR activities

through its business and seeks ongoing improvements. Key CSR activities

and materiality are revised every year based on a review that incorporates

stakeholder comments.

In fiscal 2017, we engaged in six key CSR activities based on their

materiality, as summarized below.

Step 4 Review

Step 3 Confirm validity

Step 2 Prioritize

Step 1 Identify issues

Enhancement of energy security ● Stable supply ● The pursuit of safety ● Provision of better products and services

● Global warming countermeasures ● Promotion of resource saving● Promotion of biodiversity conservation ● Promotion of environmental technologies development

● Building communities and a way of life that is safe and secure● Building a society and a way of life that is good for the environment ● Enriching our life and culture

● Human rights due diligence

● Permeation and rigorous practice of compliance ● Prevention of bribery and corruption● Protection of personal information

● Promotion of diversity ● Development of human resources ● Occupational safety and health

Contribution to the environment

Contribution to local communities

Respect for human rights

Promotion of compliance

Enhancement of people-centered management base

1

2

3

4

5

6

Areas to be recognized as issues

Materiality Matrix

Importance to the CompanyHigh

Impo

rtan

ce t

o st

akeh

olde

rs

Areas to be addressed to develop business and meet social demands and expectations

Top priority areas

High

CategorizingCategorize material issues by the Tokyo Gas Group’s key

activities and materiality.

● Presence in the community● Procurement practices● Raw materials● Local water resources● Pollution prevention

● Labor relations● Procedure for handling complaints regarding

labor practices● Employee satisfaction● Discrimination and the socially vulnerable

● Indirect economic impacts● Environment in general● Procedure for handling environmental

complaints● Working conditions and social protection● Public policy● Anti-competitive practices

● Procedure for handling complaints about social impacts

● Asset maintenance and management and process safety

● Education and culture● Health promotion● Information disclosure

● Resource reserves● Customer health and safety● Product and service labeling● Atmospheric emissions and

energy● Drainage and waste● Biodiversity● Products and services● Local communities● Sustainable consumption

● Human rights due diligence● Customer privacy● Bribery and corruption prevention● Social and environmental compliance● Diverse human resources and equal

opportunity/diversity (employment)● Training and education● Occupational safety and health● Supplier assessment (environment, labor

practices, human rights, and social impacts)

Aspects Identified as Material Issues

● Major Changes from Our Materiality up to Fiscal 2017

1. We categorized our materiality into strategic issues and fundamental business issues.2. We repositioned governance and compliance into our management base.3. We determined the relevance between our materiality and the SDGs to which the Tokyo Gas Group contributes.

● and ● indicate materiality that are highly relevant.

Contributing to SDGs through Initiatives on Materiality

The Tokyo Gas Group will focus

on SDGs 7, 9, 11 and 13 through

its strategic initiatives, and SDGs

5, 8, 10, 16 and 17 through its

fundamental initiatives. We will

contribute to the SDGs through

CSR management by determining

their relevance to our new

materiality.

The Tokyo Gas Group’s Contribution to Selected SDGs

● Creation of a lively organization

● Sound stakeholder relationships

● Achievement of public mission as an energy company

Development of Innovative Technologies

Strategic Initiatives

Response toClimate Change

Stable Supply of Energy

Fundamental Initiatives

● Safety and disaster prevention

● Development of sustainable communities

● Stable supply of gas and electricity● Stable procurement of LNG● Construction of energy

infrastructure in developing countries

● Climate change countermeasures

Development of Sustainable Communities

Su

pp

ly C

hai

n M

anag

emen

t

Pro

mot

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of C

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espe

ct f

or H

uman

Rig

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Con

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utio

n to

Loc

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omm

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ies

Con

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n to

the

Env

iron

men

tE

nhan

cem

ent

of E

nerg

y S

ecur

ity

CS

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Gas

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201808 09

CSR at the Tokyo Gas Group

Key Activities Materiality CSR KPIs FY2017 Results Evaluation Page or Web

Enhancement of Energy Security

Stable supply

• Diversification and expansion of overseas business• Tokyo Gas America Ltd. began participating in gas development

projects in the U.S.• Tokyo Gas Asia Pte. Ltd. concluded a strategic alliance agreement with PetroVietnam

Low Pressure Gas Distribution Joint Stock Company. ○ 20

• LNG procurement to ensure stable and affordable supply• Concluded a strategic alliance in LNG procurment between Kyushu

Electric Power Co., Inc. • Concluded a new LNG sales and purchase agreement with Malaysia LNG Sdn. Bhd. ○ Web

• Infrastructure development to accommodate wider use of natural gas• Installed an additional vaporizer and tank lorry loading facility at the

Hitachi LNG Terminal.• Completed construction of the Koga-Moka Line. ○ 19

• Expansion of competitive power generating capacity and electric power sales • Established Prominet Power Co., Ltd. based on a capital and business partnership with Shizen Energy Inc. ○ WebThe pursuit of safety・ Earthquake disaster prevention measures・ Safety measures at customer sites

• Promotion of earthquake, tsunami and other disaster measures• Promotion of maintenance measures for aging pipes and other infrastructure• Improvement of disaster resilience• Promotion of switching to safer appliances

• Subdivided the low-pressure service network of the head office area, from 252 blocks into 261, for a more precise remote shutting down of the gas supply in order to prevent disaster.• Advised users to replace aging underground house pipes other than those already replaced in FY2015 and performed upgrades upon request.• Expanded the adoption of cooking stoves equipped with safety sensors for auto shut-off to prevent overheating and flame failure, with 1.75 million units sold to date.• Paid 3.931 million visits for periodic safety inspections of gas equipment and completed 3.555 million inspections, excluding times when customers were not at home.

○ 23/Web

Provision of better products and services • Provision of products, services and related information• Number of low-voltage customers: approx. 1.13 million• Provided useful information to customers via online media, including

“Furomimi,” “Torisetsu” and “Heat Shock Forecasts.”

• Customer feedback and initiatives for business improvement Total number of customer comments: 16,460 (1,260 expressions of gratitude (7.7%), 1,358 complaints (8.2%) and 13,842 system requests (84.1%))

○ 21

Contribution to the Environment

Climate change countermeasures

• Reduction of CO2 emissions at customer sites by 8 million tons by FY2020 (from levels in FY2011) • Reduction in CO2 emissions at customer sites: 4.04 million tons (compared with FY2017 target of 3.9 million tons) ○ 26• Energy usage intensity at LNG terminals*1: 250 GJ/million m3 by FY2020 • Energy usage intensity at LNG terminals: 209 GJ/million m3 (compared with FY2017 target of 220 GJ/million m3) ○ 26• Heat sales intensity for district heating and cooling centers*2: 1.19 GJ/GJ by FY2020 • Heat sales intensity for district heating and cooling centers: 1.22 GJ/GJ (compared with FY2017 target of 1.33 GJ/GJ) ○ 26• Energy usage at Tokyo Gas offices, etc.: 910 thousand GJ in FY2020 • Energy usage at Tokyo Gas offices, etc.: 902 thousand GJ (compared with FY2017 target of 920 thousand GJ) ○ 26• Reduction of CO2 emission factor at the electricity retail level • Promoted the procurement of electricity generated by high efficiency thermal power and renewable energy sources. ○ Web

• Promotion of a wider use of renewables• Continued to make maximum use of renewable and underused energy

sources to power various Smart Energy projects.• 485 thousand m3 of biogas derived from food waste fed to city gas distribution pipes. ○ Web

Promotion of resource saving

• Maintenance of zero emissions at production plants (final disposal rate of less than 0.1%) • Final waste disposal rate at production plants: 0.6% △ 28• Maintenance of construction waste recycling rate at 98% or higher until FY2020 • Recycling rate of construction waste: 97.7% △ 28• Recycling rate for industrial waste generated at offices: at least 90% by FY2020 • Recycling rate for industrial waste generated at offices: 86.5% (compared with FY2017 target of 88%) △ 28• Soil excavated during gas pipeline construction: maintain at 16% or lower until FY2020 • Soil excavated during gas pipeline construction: limited below 21% × 28

Promotion of biodiversity conservation • Promotion of biodiversity conservation activities along the LNG value chain

• Surveyed the status of biodiversity consideration at source gas fields and confirmed that there were no problems.

• Managed ballast water discharged during LNG transport, conducted habitat surveys at green areas inside the three LNG terminals and implemented conservation activities.

• Practiced the 3Rs (reduction, reuse, and recycling) on soil discharged when laying gas pipes to reduce the impact caused by excavation of pit sand on the ecosystem.

• Implemented forest conservation activities and habitat surveys at the Nagano Tokyo Gas Forest.

○ 28

Promotion of environmental technologies development

• Promotion of development of low-carbon technologies

• Operated three hydrogen stations.• Applied technological innovation to combined heat and power (CHP) systems to achieve the highest power generation efficiency of 42.5% in our 1,000 kW-class

systems and total efficiency of 80.1%.• Began investing in venture capital firms and venture businesses specializing in energy technologies in order to incorporate innovative technologies from around the world.

○ 29

Contribution to Local Communities

Building communities and a way of life that is safe and secure

• Strengthening of initiatives to enrich society• Constructed a Smart Energy Network in the northern district near

Tamachi Station’s east exit.• Promoted smart networks by supplying energy in the Nihonbashi Muromachi areas,

including town blocks. ○ 32/Web

• Provision of information on disaster prevention measures • Organized regional programs related to emergency toilets in preparation against disasters. ○ Web

Enriching our life and culture • Promotion of communication activities with local communities to enrich the quality of life• Program of interactive activities (HIIKU, food education, eco-cooking, cooking classes, etc.), support for youth education through sports (para sports, youth soccer and

baseball workshops, etc.) ○ 31/Web

Building a society and a way of life that is good for the environment

• Promotion of activities to raise energy and environmental awareness• Interactive environmental education through the Donguri (Acorn)

Project and activities to support education in schools: 1,263 programs• Special classes taught by employees: 727 with 22,687 participants (total: 36,562 with

1,102,087 participants to date) ○ 31

Respect for Human Rights

Human rights due diligence • Promotion of human rights compliance management

• Various training with level-specific training at its core: 17,070 participants• Initial training for human rights promotion leaders and booster training

for leaders: 353 participants• Internal and external consultation desk providing communications

support: 104 cases

• Workshops for people with disabilities to address important human rights issues: 350 participants

• Established Tokyo Gas Group Human Rights Policy to define the respect for human rights required of a global company.

○ 35

Promotion of Compliance

Permeation and rigorous practice of compliance

• Promotion of compliance• Steady implementation of a PDCA cycle

• Held study sessions and various seminars to permeate the revised Tokyo Gas Group Our Code of Conduct.

• Total number of participants in workplace study sessions based on the latest compliance cases: 28,726

• Level-specific training and training provided by instructors dispatched to meet individual department and company needs: 27 sessions with 614 participants

• Timely provision of information on compliance: 6 instances• Cases handled by Consultation desks: 104

○ 37

Prevention of bribery and corruption • Promotion of sincere and equitable activities in accordance with Tokyo Gas Group Our Code of Conduct• Training provided for 344 employees involved in international business • Revised the Basic Policy On Promoting Overseas Business following the establishment

of Tokyo Gas Group Human Rights Policy. ○ 37

Protection of personal information • Practice of safety management in accordance with our policy on protection of personal information

• Awareness raising incorporated into level-specific training provided upon joining the company, in the third year, and during qualification promotions (two levels): 1,527 participants

• Awareness raising included in training provided by instructors sent to individual departments: 614 participants

• Number of participants in e-learning for raising employee awareness of the revised Act on the Protection of Personal Information, including clarification of personal information and compliance with requirements for anonymized information: 21,342 ○ 37

Enhancement of People-Centered Management Base

Promotion of diversity • Promotion of active participation of diverse human resources and workstyle flexibility

• Introduced a work-at-home program, which we plan to expand in several stages.

• Designated a Nadeshiko Brand company for the second consecutive year.• Ratio of women in management: 7.6%• Ratio of employees with disabilities: 2.10%

• Number of employees working shorter hours as parents of small children: 217

• Number of employees taking parental leave: 50 (93% subsequently returned to work*3)

• Number of employees working shorter hours to care for relatives: 2• Number of employees taking nursing care leave to care for relatives: 1

○ 39

Development of human resources • Development of a training structure

• Twin-pillared human resource development program to develop (1) foundational and common skills, and (2) wide-ranging expertise- Development of foundational and common skills: courses on global business skills and development of next-generation leaders- Development of a broad range of expertise: approx. 1,275 sessions taught over approx. 160 courses for the residential services segment, and training utilizing technology and skills certification programs and training centers for the pipeline segment

○ 39

Occupational safety and health • Promotion of occupational safety and health• Occupational health physicians provided health consultations, career

ladder consultations, and health education services.• 100% of employees received health checkups.

• Operated an occupational safety and health management system (OSHMS).• Managed an in-house driving license scheme.• Introduced vehicles equipped with safe driving support systems.

○ 39

○ Target achieved (100% or above)　△ Target not achieved but improved from previous fiscal year (100% not achieved but improved from previous fiscal year)　× Target not achievedCriteria for Evaluating CSR KPIs

Third-party Assured

Third-party Assured

Third-party Assured

Third-party Assured

Third-party Assured

Third-party Assured

Third-party Assured

Third-party Assured

Third-party Assured

Key CSR Activities and Major Results The Tokyo Gas Group designates KPIs for each CSR materiality issue in order to effectively apply PDCA cycles in

the promotion of its CSR activities. Results related to materiality are summarized below.

*1 Energy consumed per unit of gas produced. *2 Energy consumed per unit of gas sold.*3 Percentage of employees taking parental leave each fiscal year who returned to work at the company.

Note: Qualitative CSR KPIs with no evaluation axis are assessed on the basis of whether progress has been made since the previous fiscal year.

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201810 11

　

LNG

LNG

CSR at the Tokyo Gas Group

In addition to sourcing gas from large-scale LNG projects and acquiring participating interests, we are diversifying and expanding our sources and upstream projects overseas through involvement in unconventional gas, such as shale gas, and in small- and medium-scale LNG projects. Also, we provide energy solutions for energy infrastructure in Southeast Asia and North America.

922

Overseas Business Expansion

　City Gas Production

(as of the end of May 2018)

(fiscal 2017 result)

Power Transmission (by General Power Transmission Utilities)

Note: Power is transmitted via a grid operated by general power transmission utilities.

Energy Solutions

We develop energy solutions by combining distributed energy systems such as fuel cells and combined heat and power (CHP) systems* that reduce CO2 emissions, energy consumption and peak load, with the wider use of environmentally friendly gas appliances and renewable sources of energy.

City Gas Supply

We are further developing our pipeline network and using LNG tanker trucks and coastal tankers to ensure the safe and uninterrupted delivery of city gas. In addition, we are expanding our wholesale distribution of gas to other gas suppliers.Note: Our pipeline network is shared with gas retailers.

Power Generation

We operate high-efficiency combined cycle natural gas-fired power stations utilizing our LNG procurement capabilities and LNG terminals, pipelines and other facilities. In addition, we generate electricity using wind power and other renewable energy resources.

3,785Storage Capacity at LNG Terminals

Total Length of Pipelines

Greenhouse Gas Emissions alongthe LNG Value Chain 〉Page 26

LNG Procurement

projects across 6countriesvessels

million tons

ML

13Long-term Contracts

LNG procurement volume

In order to source natural gas to meet demand flexibly and competitively, we work with diverse players in Japan and abroad while diversifying our procurement sources, contract conditions, LNG networks and other factors.

LNG procurement to ensure stable and affordable supply 〉Page 19

Overseas Businesses Serving as the Backbone of Stable Energy Supply 〉Page 3

Expanding Our Overseas Business 〉Page 20

Evolving into a Total Energy Business 〉Page 19

14.244 (as of the end of May 2018)

(as of the end of March 2018)

(as of the end of March 2018)*Gas engine-based CHP systems generate electricity and recover waste heat generated as a by-product.

9LNG Carriers Owned and Operated by Tokyo Gas

LNG Transport

The Tokyo Gas Group owns and operates its own fleet of LNG carriers, allowing LNG to be shipped swiftly and flexibly.　

By receiving LNG and constantly producing city gas, the Group contributes to energy security in the Tokyo metropolitan area. Our LNG Greenhouse Gas Emissions along

the LNG Value Chain 〉Page 26

Energy Supply Network in the Tokyo Metropolitan Area 〉Page 3 Greenhouse Gas Emissions along

the LNG Value Chain 〉Page 26

Switching to Natural Gas and More Advanced Use 〉Page 27

Diffusion of CHP Systems 〉Page 27

Development of Infrastructure for Hydrogen Supply 〉Page 29

Technological Innovations in CHP Systems 〉Page 29

Developing Our Natural Gas Infrastructure in Japan 〉Page 19

Greenhouse Gas Emissions along the LNG Value Chain 〉Page 26

km63,557

The Tokyo Gas Group’s LNG Value Chain and Key Initiatives Contributing to Sustainable Development

Committed to contributing to the sustainable development of society, we are advancing the LNG value chain

while also developing new-generation technologies and leveraging digital technologies.

terminals function as mutual backups for each another, ensuring uninterrupted city gas supplies even in the event of a power failure or other incidents.

Number of City Gas Customers

11.678 million

Gas Sales Volume

15,568million m3

Electric Power Sales Volume

14.66billion kWh

Number of Electricity Customers

1.13(as of the end of March 2018)

million

Overseas Business Development

Major ProjectsPower Generation Capacity (Own Stake)

Countries

(as of the end of March 2018)1.60 million kW (as of the end of March 2018)

● Ensuring of Information Security ● Development of Human Resources● Promotion of Employees’ Occupational

Safety and Health Activities

〉Page37

〉Page39

〉Page39

● Enhancement and Strengthening of Corporate Governance● Development of Technologies Contributing to Safety and

Environmental Friendliness● Respect for Human Rights● Promotion of Compliance

〉Page41

〉Pages 22–23, 29

〉Page35

〉Page37

Initiatives Relevant to the Entire LNG Value Chain

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201812 13

CSR at the Tokyo Gas Group

Stakeholder Engagement

Reviewing Work Styles and Transforming the Company, where Employees Can Enjoy ChangeResponding to Customer Needs with a Women’s Perspective

Tokyo Gas i Net sets up the Work Taskforce in 2016 for work style reform after employees pointed out we were not doing enough for the careers of all the women at the company. Accordingly, we studied the statistics on aspects such as turnover and rate of promotion and felt that something needed to be done, which spurred the creation of a working group led by women. Since then, we realized the importance of ensuring a lively workplace and have invited more men to participate in the group. For example, in response to our proposal, the eligibility and conditions for working at home gradually expanded and relaxed, which earned favorable feedback from employees who could subsequently focus better and boost their productivity or eliminate their commute. Within two years we implemented 16 measures, including establishment of a short-term in-house internship program and spaces that encourage communication among employees. We owe our progress in large part to the support we received from the president. When struggling to find a way to measure the effects of the reform, he advised

I belong to the Customer Communication Team, organized in 2011, and am responsible for following up on customers who have installed ENE-FARM in their homes and for replacing alarms. All members of the team are women, and we perform our daily operations with an emphasis on providing a women’s perspective to our services.

For example, we dispatch female staff to respond to requests by customers who are women and usually at home during the day, and feedback received from them indicates that they feel more comfortable with this arrangement. Also, the sensibility of our female staff is similar to that of customers who are homemakers, so we can offer explanations and proposals from the same standpoint, thus making them feel more at ease and closer to us during consultations.

We value the customer’s perspective and strive to build on our knowledge as professionals providing energy proposals and creating comfortable lifestyles. Looking ahead, we will continue to develop our bonds with customers as a means of addressing their needs.

Identifying Our StakeholdersPurpose of Engagement

The Tokyo Gas Group’s business brings it into contact with a wide range of stakeholders. Guided by our Corporate Action

Philosophy and Code of Conduct, all Group executives and employees have sought to develop good relationships with

stakeholders and work together with society toward achieving sustainable growth.

In keeping with this direction, we engage with our stakeholders on a daily basis in accordance with our Stakeholder

Engagement Policy, which defines the specific stakeholders and purpose and methods of engaging with them.

In pursuit of engagement, we identify stakeholders

interested in the decision-making and business activities

of the Tokyo Gas Group (see pages 16 and 17 for

details on how we respond to and communicate with

stakeholders).

Methods of Engagement

The division or site that is most closely related to

stakeholders serves as the contact point and takes

responsibility for establishing two-way communication

with them. Toward making further improvements, the

results of engagement are shared within the relevant

division, as well as with the Corporate Communications

Promotion Committee as necessary. Information is

disclosed through such means as our website and CSR

reports to maintain our PDCA cycle. Also, we raise

employee awareness of stakeholder engagement through

training and other activities.

We are forging favorable relationships and partnerships

with our stakeholders by understanding and meeting their

expectations so that we can make decisions on the Tokyo

Gas Group’s business activities and generate value.

Left: Motoko Ito, Manager, LIVALIT Sect., Sales Solution Department, TOKYO GAS i NET Corp.Right: Tadateru Nagao, Manager, Work Style Innovation Project Sect, Human Resource & General Affairs Department, TOKYO GAS i NET Corp.

Top: Riho Yoshida, Team Leader, Customer Communication Team, Customer Support Division, Tokyo Gas LIFEVAL Kawasaki KitaBottom: Yumi Shimura, Customer Communication Team, Customer Support Division, Tokyo Gas LIFEVAL Kawasaki Kita

VOICE

2VOICE

1

us to focus on making a change rather than getting stuck on merely searching for an effective means of measurement. In fiscal 2018, we will set up of the Work Style Reform Committee to offer more concrete proposals. By maintaining dialogue with staff, we hope that all these small but good changes add up, so we emerge as a company in which employees can enjoy change.

Whenever we visit a customer’s home to close a city gas valve, which is not necessary for customers to present, but we attempt to notify them that they will not be able to use the gas at that time.

Customers Shareholders and Investors

Local Communities

Government Agencies and Local

GovernmentsBusiness Partners

Universities and Research

Institutions

Group Employees

Major Stakeholders

Customers GroupEmployees

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201814 15

CSR at the Tokyo Gas Group

CustomersShareholders and

InvestorsLocal

CommunitiesGovernment Agencies

and Local GovernmentsBusinessPartners

Universities and Research Institutions

Group Employees

● Stable supply of energy● Ensuring safety and quality of energy and

products● Provision of appropriate information on

products and services● Provision of information on environmental

protection and environmentally friendly products and services

● Improvement of customer satisfaction

● Maintenance and improvement of corporate value

● Fair distribution of returns to shareholders

● Timely and appropriate information disclosure

● Contribution to solving social issues in individual countries and regions

● Support for educating the next generation

● Tax payments● Compliance with laws and

regulations● Cooperation in public policy

and programs to solve social issues

● Fair and equitable business transactions

● Practice of CSR procurement● Development of better

partnerships and information sharing

● Engagement in solving social issues and contributing to better lifestyles and community development

● Creation of a comfortable work environment

● Promotion of diversity● Development of human resources ● Occupational safety and health● Provision of information and awareness-

raising on environmental protection

▶︎Development of smart towns in accordance with government plans

▶︎Urban revitalization and housing complex regeneration

▶︎Development of smart energy networks through redevelopment projects

▶︎Joint research contributing to safety, meter reading, safety services, etc.

▶︎Joint research contributing to environmental protection, disaster response, prevention of health hazards and the revitalization of regional economies

▶︎Joint research contributing to energy conservation and health

▶︎Joint research contributing to better lives in a super-aging society

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▶︎Periodic safety inspections of gas equipment▶︎Meter readings▶︎Gas appliance repair▶︎Local service outlets (Tokyo Gas LIFEVAL, Enesta,

Enefit)▶︎Customer Center (phone

and email)▶︎ Customer feedback cards▶︎ Customer satisfaction

surveys

● Receipt of applications, feedback and inquiries● Improvements based on feedback

● Disclosure of information on performance and finances

● Explanation of the state of Group activities and plans

● Participation in urban development through our main line of business

● Surveys and research to address challenges faced by society and contribute to better lives and community development through our business activities▶︎Online publication of Principles

and Standards of purchasing practice and purchasing Guidelines for Suppliers

▶︎Briefings for business partners

● Provision of fair and equitable business opportunities through disclosure of standards, policies, etc.

▶︎Surveys of CSR activities by business partners

▶︎Dialogue and consultation with business partners

● Monitoring status of CSR practice

▶︎Development of the Overarching Commitment to Diversity and Basic Policy Regarding Promotion of Diversity

▶︎Seminars and lectures on promoting diversity▶︎Introduction of a home working system

● Promotion of opportunities for diverse human resources

▶︎Communication of messages from the president

▶︎Plenary meetings and briefing sessions to report on conditions at Group companies

▶︎Workplace communication activities▶︎Group newsletter and intranet

● Sharing of information and promotion of understanding within the Group

▶︎Regular interviews with supervisors

▶︎Various training

● Development of employee skills● Counseling for career planning

▶︎Meetings and training on safety and health

▶︎Actions to maintain and improve health

● Provision of information and awareness-raising on occupational safety and health

● Actions for mental health and prevention of lifestyle-related diseases

▶︎Group environmental contribution award system▶︎Training, study tours and seminars for Group

employees

● Sharing of information on Group environmental activities

● Provision of information and awareness-raising on environmental protection

▶︎Consultation desks▶︎Employee opinion surveys

● Handling of consultations on compliance, human rights within the Group

● Monitoring of employee attitudes

▶︎Labor-management dialogue and consultation

● Development of good labor-management relations

● Improvement of quality and appeal of products in collaboration with business partners

▶︎Recognition of business partners at the Business Partner Appreciation Awards

● Provision of events and opportunities to promote understanding of our operations

▶︎Organization of facility tours for business partners

● Consultations to ensure fair business relations

▶︎Consultations with suppliers of LNG and other supplies and confirmation of transaction details

▶︎Disaster prevention events organized by local governments

● Promotion of disaster prevention activities

▶︎Seminars on energy, the environment and community development

▶︎Membership of environmental councils and other bodies

● Provision of information to resolve social issues and promote policy implementation

● Participation in central and local government committees and workshops

▶︎Gas Science Museum▶︎Gas Museum▶︎Shinjuku Showroom and Yokohama Showroom▶︎Cooking studio Kitchen Lands▶︎Gas exhibitions▶︎Events and seminars

● Provision of information on energy, the environment, household facilities, appliances, etc.

● Provision of information and promotion of understanding regarding the Group’s environmental activities

● Provision of opportunities to experience environmental activities

● Proposal of comfortable home and lifestyle solutions

● Offering of cooking classes

▶︎ Tokyo Gas website ▶︎ Email newsletters ▶︎ Facebook ▶︎ myTOKYOGAS

● Provision of information on energy, facilities, appliances, and services

● Provision of tips for everyday life on cooking, conserving energy and saving money, etc.

▶︎Tours of LNG terminals and disaster prevention facilities

● Provision of information and promotion of understanding concerning measures to ensure stability of city gas supply and prevent disasters

▶︎Annual Report and Investors’ Guide

▶︎Newsletter for shareholders

▶︎Disclosure of investor relations information on the Tokyo Gas website

▶︎General shareholder’s meetings▶︎Financial results briefings▶︎Briefings for individual investors▶︎One-on-one meetings with institutional

investors▶︎Facility tours for individual shareholders

● Provision of information and awareness-raising on disaster prevention

▶︎Disaster prevention events cohosted with NPOs

● Volunteer activities by Group employees and their families

▶︎Support for regions affected by the Great East Japan Earthquake

▶︎Collection and donation of used stamps, cards and spoiled postcards

● Support for the Olympic and Paralympic Games Tokyo 2020

▶︎Support activities as an Official Partner (Gas & Gas Utility Services category) of the Olympic and Paralympic Games Tokyo 2020

● Provision of information, education and opportunities for directly experiencing energy and the environment

▶︎Support for school education (teaching, teacher training, and provision of information via out-of-school learning activities, educational materials and an e-learning site)

▶︎Donguri (acorn) outdoors environmental education project

▶︎Hands-on HIIKU fire education program for the next generation

● Support for environmental protection activities

▶︎Support for the environmental and the social contribution activity: Mori Sato Umi Tsunagu (Connecting Forests, Villages and Ocean) Project

The Tokyo Gas Group pursues diverse forms of engagement based on its Stakeholder Engagement Policy.

Moreover, we receive opinions from our wide-ranging stakeholders and actively adopt valuable suggestions

for our business.

● Provision of information and awareness-raising concerning the Group’s disaster prevention activities

● Provision of information contributing to safety and peace of mind in everyday life

● Monitoring of views/demand and incorporation into activities

▶︎Local activities

● Support for para sports● Provision of opportunities for the active engagement

in sports through soccer coaching, tournaments, etc.

▶︎Activities as an Official Partner of the Japanese Para-Sports Association

▶︎Junior soccer coaching sessions

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201816 17

Tokyo Gas currently imports LNG under long-term contracts

from countries in the Asia-Pacific region and Russia as well

as others. In May 2018, we began procuring LNG from the

Cove Point Project in the United States.

TOKYO GAS TOP > CSR Report > Enhancement of Energy Security > Targets and Performance

1

https://tokyo-gas.disclosure.site/en/themes/97WEB

● LNG Suppliers

Always striving to deliver better service, the Tokyo Gas Group pursues the steady, low-cost procurement

of LNG while also ensuring the safety of customers. We are accelerating the pace of business expansion

overseas and establishing our LNG value chain, both at home and abroad, so that we can contribute to regional

development. We do this by providing stable energy supply and energy infrastructure while offering energy

solutions in Japan and other countries in which we do business.

Enhancement of Energy Security

Subdivided gas service network for disaster

prevention*2

> Page 22

261blocks

LNG procurement volume*1

> Page 19

14.24● Tokyo Cove Point

Cameron (scheduled to commence

in 2020)

Qatar

Sakhalin

Darwin

Ichthys (scheduledto commence in 2018)

Queensland Curtis

NWSGorgon Pluto

Malaysia

Brunei

6countries

13projects

LNG suppliers Major projects

(as of the end of May 2018)

Under the Medium-term management plan GPS2020, the

Tokyo Gas Group has been developing and augmenting an

infrastructure that is optimal for achieving a wider use of

natural gas. To meet demand for natural gas primarily for

industrial use in Ibaraki and Tochigi prefectures, we

completed construction of a transmission pipeline

between Koga and Moka in fiscal 2017. As a result,

we extended the total length of our high-pressure

pipeline network in the Greater Tokyo Area to about 982

kilometers. Additionally, construction of the Ibaraki Line

is underway to complete the looped network of high-

pressure pipelines that will serve the entire area. It will

also improve the stability of supply and increase transport

capacity across our gas supply network.

In our liquid gas business, which includes LPG, we

are targeting one million or more customers by 2020

through partnerships. Toward ensuring a steady, efficient

supply, we signed a basic agreement in February 2018

with Astomos Energy Corporation and ENEOS GLOBE

Corporation to explore partnerships for jointly handling

operations such as the filling and delivery of LPG.

While making a focused effort to expand our electric

power business, we will nearly double our proprietary

power sources from approximately 1.6 million kW as

of the end of March 2018 to 3.0 million kW by 2020, at

which point we plan to have already purchased a power

source from Kobelco Power Moka Inc. in 2019.

● LNG Procurement Volume2.LNG調達量 (thousand tons)

0

12,000

15,000

2013 2014 2015 2016 2017

14,249 14,244

12,804

13,967 13,875

(FY)

Stable Supply

*1 Actual results for fiscal 2017*2 Number of blocks of the low-pressure networks

(Figures for the Tokyo Gas Group as of the end of March 2018)

● Pursuing Steady, Cost Competitive LNG Procurement

● Developing Our Natural Gas Infrastructure in Japan ● Evolving into a Total Energy Business

Major projects in the overseas business

22> Page 20

projects

Key CSR Activity

1Key CSR Activity

million tons

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201818 19

1Customer Feedback in Management

Service Framework for Providing Everyday Comfort

For Tokyo Gas, delivering customer satisfaction is far more

important than simply delivering a product or service. We

understand the importance of improving the quality of

management by incorporating customer feedback into

our products and services, and we seek feedback from

The Tokyo Gas Group set up the Tokyo Gas LIFEVAL

network as a one-stop shop for products and services that

improve quality of life. As of April 1, 2018, the network

consisted of 32 corporations in 62 regional blocks.

Tokyo Gas LIFEVAL performs a number of tasks such

as periodic safety inspections of gas equipment, meter

readings, opening and closing of gas valves, the sale,

repair and installation of gas appliances, and processing

of applications for gas and electricity services. In addition,

they provide information related to energy and daily life,

such as plumbing renovations, energy conservation and

power generation, to help local residents enjoy safe,

environmentally friendly, comfortable lives.

We also seek to deliver peace of mind in general through

our services. To address a range of daily needs, the broad

lineup of services we offer customers includes Emergency

Home Assist Services, Gas Fixture Troubleshooting Support,

Residential Monitoring Services, Electricity Troubleshooting

Support and Gas Fixture Special Support. And we are

helping to enhance energy security for customers by

providing better products and services.

We improved our meter reading slip by reflecting the opinions and requests of customers.

Opinions and Requests

• I didn’t realize it was a combined bill for electricity and gas, and the breakdown is hard to read.

• The electricity fee is printed too small.• I want to see the breakdown for the

electricity bill.• Please clearly indicate the amount and

period of electricity use.

New Meter

Reading Slip

2Used larger characters in printing the usage and fee

Total amount Receipt Gas fee breakdown Electricity breakdown 1 Electricity breakdown 2

16,460comments

FY2017

Expressions of gratitude1,260 comments

Complaints1,358 comments

Opinions about systems

13,842 comments

84.1%

7.7%

8.2%

1 “Total amount” and “Breakdown” are indicated separately

In May 2017, Tokyo Gas America Ltd. acquired a 30% equity interest in

Castleton Resources LLC (CR) to develop gas in Texas. This is the third gas development project in which Tokyo Gas has participated, and the first capital investment in a U.S. gas developer.

CR owns a leasehold in Texas where it develops shale gas and tight sand gas, which show promising potential as new sources of energy, through an affiliated operating company. We believe that our latest investment will contribute to the sustainable and stable supply of energy.

Promising Initiatives on Energy Resource Procurement

East Texas tight sand and shale gas development project

North America

In July 2017, Tokyo Gas Asia Pte. Ltd. acquired a 24.9% equity interest of

PetroVietnam Low Pressure Gas Distribution Joint Stock Company (PVGD), a Vietnamese gas distributor,

Developing Business in Southeast Asia Based on Proprietary Resources

Vietnam

Tokyo Gas Asia Pte. Ltd. established a joint venture with Development

Bank of Japan Inc. in October 2017 to acquire a 33% equity interest of PT Panji Raya Alamindo (PRA), a gas distributor and subsidiary of PT Rukun Raharja Tbk, the largest private gas company in Indonesia. This is Tokyo Gas’s third investment in an overseas gas distributor. Indonesia is experiencing remarkable economic growth, and demand for energy in the industrial and commercial sectors is expanding rapidly. We will seek to raise the value of PRA’s business by making use of the Tokyo Gas Group’s know-how and human resources.

Indonesia

Driven by outstanding economic growth, global demand

for energy is rising rapidly. Subsequently, Tokyo Gas

participates in new overseas projects and is developing

business in new areas. Together with Tokyo Gas

Engineering Solutions Corporation, we now operate

businesses in nine countries and are involved in as many

as 22 major projects as of the end of March 2018.

Demand for natural gas is projected to grow in

Southeast Asia, where we are forming partnerships

with leading local companies to expand businesses

particularly in the mid- and downstream sectors. In fiscal

2017, we concluded a strategic alliance agreement

with PetroVietnam Low Pressure Gas Distribution Joint

Stock Company (PVGD) of Vietnam and extended capital

investments in PT Panji Raya Alamindo (PRA) of Indonesia

and Gulf WHA MT Natural Gas Distribution Co., Ltd.

(GWHAMT) of Thailand.

In North America, where there is greater progress

being made in the development of shale gas and other

types of natural gas, in addition to LNG, we are working

to establish our energy infrastructure by participating in

upstream businesses and power generation projects. In

fiscal 2017, we invested in the gas development company

Castleton Resources LLC and participated in a natural gas-

fired power plant business in Birdsboro.

The Tokyo Gas Group will continue to build energy

infrastructure and provide energy solutions by leveraging

its technology and know-how. At the same time it will

further expand its value chain by forging closer

cooperative relationships with overseas subsidiaries.

and concluded a strategic alliance agreement. Tokyo Gas had signed a comprehensive cooperation agreement on developing an LNG value chain with PVGD’s parent company PetroVietnam Gas Joint Stock Corporation in March 2012, and our latest agreement resulted from continuous negotiations on the substance of cooperation. The acquisition of PVGD stock is the second case in which we have expanded our business domain in Vietnam under a comprehensive cooperation agreement. In the years ahead, we will strive to enhance the value of PVGD’s business by applying the Tokyo Gas Group’s know-how on developing demand and energy-saving technologies.

● Expanding Our Overseas Business

Seeking Greater Breadth and Depth in Our Overseas BusinessTO

PICS

Example of Improvements Based on Customer FeedbackTO

PICS

customers through calls to our Customer Center, direct

contact and various surveys. The opinions and requests we

receive are shared within the company and all the way up

to top management. Moreover, they are incorporated into

our daily activities as we make improvements and enhance

quality. We report back to customers on some of these

efforts through our corporate website.

Total amount Breakdown for gas and electricity

3 Customers can check the details of their electricity contract and breakdown of fees

● Framework for Incorporating Customer Feedback

Quality enhancement Opinions and requests

Points noticed by employees

Development and improvement of products and services

Customers

Channels for collecting customer feedbackImprovement activities

• Customer Center• Direct contact• Various surveys

Information sharingCustomer feedback system

• Customer Satisfaction Promotion Committee chair (president)

• CS meetings in each department

• CS meetings with subcontractors

● Breakdown of Customer Feedback

Top management

Employees

Subcontractors

TOKYO GAS TOP > CSR Report > Enhancement of Energy Security > Targets and Performance

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201820 21

Safety Measures for Customers

● Periodic Safety Inspections of Gas Equipment

Under the Gas Business Act, we periodically inspect gas equipment at all customer sites at intervals mandated by law. As a general gas pipeline operator, we check for gas leaks on customer premises. As a gas retailer, we visit customers to inspect gas appliances as well as air supply and exhaust systems. Also, we recommend the installation of gas and carbon monoxide alarms and provide contact information at times when an industrial ventilation alarm goes off.

Earthquake Damage Prevention SystemSUPREME is our system for preventing earthquake damage by utilizing seismic sensors positioned in a highly dense layout of one per square kilometer.

Highly Earthquake Resistant FacilitiesQuick Shutdown of Gas Supply to Prevent

Secondary Disasters

To minimize potential damage, critical facilities are being reinforced to withstand earthquakes and tsunamis.

We make maximum use of IT systems to efficiently shorten the time it takes to restore gas supply to areas where service has been suspended.

● Emergency Safety Techniques and Skills ExhibitionWe have continuously held emergency safety techniques and skills exhibitions for enhancing the quality of our emergency safety operations and passing on skills to the next generation of employees. In fiscal 2017, Tokyo Gas and subcontractors gathered to demonstrate and mutually enhance their techniques and skills for daily operations such as gas pipe repairs and initial response to gas leaks, with 308 people in attendance. Through these efforts, we endeavor to raise awareness and ensure safety, security and reliability for customers.

● Gaslight 24, a Round-the-Clock Emergency Dispatch SystemGaslight 24 teams, on call around the clock, immediately respond to a gas leak or other emergencies. Within the 5 blocks of the Tokyo Gas service area, about 600 experts are stationed at 49 locations.

● Safety Measures for Gas Appliances and EquipmentTokyo Gas promotes the switch to safer appliances through periodic safety inspections of gas equipment. We have also established a quality control department for the prompt investigation of causes of failures and incidents involving gas appliances, thereby ensuring customer safety and eliminating concerns.

Our system is capable of remotely shutting down gas supply to individual buildings as well as to entire zones.

Prevention1 Emergency2Safe and Swift Restoration of Gas Supply

Restoration3

Tanks used for storing imported LNG are designed to maintain high structural integrity that can fully withstand major earthquakes.

LNG TanksDistrict pressure regulators reduce gas pressure from medium to low before it is sent to customers. Our service area includes approximately 4,000 district pressure regulators, each equipped with a seismic sensor and emergency shutdown device, which will cut off gas supply when a major earthquake is detected.

District Pressure RegulatorsIn July 2014, we introduced a remotely controlled system for resuming gas supply within a day of a disaster in less damaged districts.

Restoration System

TV broadcast following an earthquake

We provide customers with information on resetting gas meters and the status of suspension and restoration of gas supply via TV and the Internet. The reset procedure is also explained on a tag attached to the meter.

Information on Suspension and Restoration of Gas Supply

More than 200 city gas companies across Japan have signed onto a mutual support system for restoration through the Japan Gas Association in the event of a major disaster.

Mutual Support Structure

Medium-pressure and low-pressure pipeline networks are divided into several blocks, and emergency measures are taken at the block level according to the degree of damage.

Disaster Prevention Blocks

The Supply Control Center accurately controls gas production and supply around the clock, 365 days a year. In the event of an earthquake, it gathers information through the earthquake disaster prevention system and remotely suspends gas supply.

Supply Control Center

Intelligent gas meters are equipped with a safety device that will automatically cut off gas supply to individual buildings when it detects earthquakes measuring 5 or greater on the Japanese seismic scale or an abnormal gas flow.

Intelligent Gas Meters

These pipelines, connecting LNG terminals and district governor installations, are made of strong, flexible materials that can withstand the impact of ground movement caused by earthquakes.

High-pressure and Medium-pressure Gas Pipelines

These containers hold the gas supplied in response to demand and feature a robust structure of multiple steel plate layers.

Gas Holders

A low-pressure gas pipeline comprises about 90% of the total length of a gas pipeline, and newly installed low-pressure gas pipelines are made of polyethylene to minimize damage caused by earthquakes.

Low-pressure Gas PipelinesMaximum number of restoration

staff (approximate)

Great Hanshin-Awaji Earthquake 9,700 per day

Niigata Chuetsu Earthquake 1,600 per day

Great East Japan Earthquake 4,600 per day

Kumamoto Earthquake 4,600 per dayNorthern Osaka Prefecture Earthquake 5,100 per day

Gas Fan HeaterEquipped with safety devices featuring functions such as preventing incomplete combustion and detecting flame failure.

Gas Cooking StoveEvery burner on gas stoves marketed since 2008 is equipped with a safety sensor to prevent the overheating of cooking oil, a safety device to detect flame failure, and a self-extinguishing function. Approximately 1.75 million units were sold by the end of March 2018.

Gas Valve with Safety DeviceAutomatically turns off gas when a gas cord or soft gas tube ruptures causing the leakage of large quantities of gas.

Integrated Fire and Gas AlarmTriggers a buzzer and blinking light when it detects a fire, incomplete combustion, or a gas leak.

WEB

The Pursuit of Safety

● Three Key Areas of Earthquake Countermeasures

The Tokyo Gas Group is strengthening the disaster-resilience and safety of its gas supply operations so that customers can

continue to use gas confidently, even after the Japanese gas retail market is fully liberalized. Our countermeasures

for earthquakes and disasters address the three key areas of prevention, emergency and restoration.

TOKYO GAS TOP > CSR Report > Enhancement of Energy Security >Targets and Performance

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201822 23

Management Philosophy

Corporate Action Philosophy

Environmental Principle

Environmental Sustainability Guidelines

Environmental Management System (EMS)

Waste Recycling Initiatives

Zero Emissions at Production Plants

Reduction of CO2

Emissions at Customers Sites*

million t-CO2 97%

4.04CO2

● Environmental Principle

● Environmental Sustainability Guidelines

Promotion of the development of environmental technologies

Promotion of environmental communication

Promotion of biodiversity conservation

Promotion of resource saving and recycling

Climate change countermeasures

[ Philosophy ]The Tokyo Gas Group will promote more sustainable ways of energy use to contribute to the protection of regional and global environments as well as to the sustainable development of society.

[ Principles ]1. Reduction of the Environmental Impact of Customers’ Energy Use2. Reduction of the Total Environmental Impact of Tokyo Gas’s Business

Operations3. Strengthening of Environmental Partnerships with the Local and

International Communities4. Promotion of Green Technology R&D Programs5. Biodiversity Conservation and Sustainable Use6. Compl iance wi th Env i ronmenta l Law and Fu l f i l lment o f Soc ia l

Responsibilities

Since LNG (liquefied natural gas) was introduced to Japan in 1969, the Tokyo Gas

Group has worked to deploy the use of environmentally friendly natural gas.

We will continue to seek solutions to environmental issues as

a total energy group from now on.

Contribution to the Environment

2Key CSR Activity

> Page 26

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%0.6Final disposal

rate

*Reduction in CO2 emissions based on fiscal 2011.(Figures for the Tokyo Gas Group are as of the end March 2018)

External Evaluation

Rated A- by CDP Climate Change Report 2017CDP is a registered charity that formulates strategies and collects data on climate change in collaboration with institutional investors. Tokyo Gas has received an A-, the Leadership level.

SNAM Sustainability Index 2018For seven consecutive years we have been selected to the index, which is composed by Sompo Japan Nipponkoa Asset Management Co., Ltd. based on the results of a corporate survey on ESG.

Cogeneration Award 2017Consumer use category: Chairman’s AwardIndustrial use category: Award for ExcellenceTechnological development category: Chairman’s Award, Special Award

Third-party Assured

Third-party Assured

Third-party Assured

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Basic Policy on the EnvironmentThe Tokyo Gas Group pursues environmental management through a concerted effort and has established its Environmental

Principle based on its Management Philosophy and Corporate Action Philosophy, and its Environmental Sustainability

Guidelines to define concrete initiatives and quantitative targets.

The Tokyo Gas Group has practiced effective and efficient

environmental management under the leadership of

top management since establishing its Group-wide

environmental management system (EMS) in 2005 to

comply with the ISO 14001. In fiscal 2017, we made

the transition to the 2015 version of ISO 14001 in order

to remain legally compliant and continuously reduce the

environmental impact of our business activities.

The Tokyo Gas Group was not cited for any violations

or fines with respect to environmental laws and

regulations in fiscal 2017. As for chemical substances, we

managed them in accordance with applicable laws and

regulations while reducing emissions.

The Tokyo Gas Group has integrated its business

management with an enterprise risk management system

so that it can review risks and monitor the status of

implementing and improving our response on an annual

basis.

With respect to risks related to climate change, we

are pursuing a two-sided response: mitigation to reduce

greenhouse gas emissions across our LNG value chain

and adaptation by working on preventive measures

against flooding caused by extreme weather. In view

of the growing risks related to water, we have been

conducting comprehensive evaluations and analyses of

current and future risks since fiscal 2016.

With respect to soil contamination caused by past gas

business activities, we conduct voluntary investigations,

disclose the results and respond to related matters

promptly.

● Promotion of Environmental Management ● Measures to Counter Environmental Risks

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201824 25

CHP

Energy SolutionsProcurement of LNG

SCOPE 3 SCOPE 3

◦ Monitoring of greenhouse gas emitted during production, liquefaction and transport by the sea

◦ Introduction of higher efficiency LNG carriers

◦ Improvement in energy usage intensity at LNG terminals, district heating and cooling services, and business offices

◦ Promotion of a high-efficiency natural gas fired power plant and renewable energy in the electric power business

◦ Improvement of facilities and operation of business offices

Production of city gas

Power generation

Supply of city gas

6.97million t-CO2

▶ Extraction and liquefaction:5.82million t-CO2*

▶ Marine transport:1.15million t-CO2* 4.19million t-CO2

▶ City gas production: 0.22 million t-CO2

▶ Power generation and power procurement: 3.65 million t-CO2

▶ Heat supply: 0.2 million t-CO2

▶ Others: 0.12 million t-CO2

Actions Actions

SCOPE 1: Business’s own direct emissions of greenhouse gases.SCOPE 2: Indirect emissions from consumption of electricity, heat, and steam supplied by others.SCOPE 3: Indirect emissions other than covered in SCOPE 2 (emissions by other parties involved with business’s activities).

（g-CO₂/MJ） ■Combustion ■Facilities ■Transportation ■Production1.天然ガスの優位性

0

40

60

100

80

Oil

73.26

118LNG

60.58

98Coal

94.93

153比率LPG

66.70

107City gas

61.91

100

◦ Promotion of the switch from other fuels to natural gas, which excels in terms of environment, economic efficiency, energy security and safety (3E+S)

◦ Promotion of distributed energy systems based on a highly efficient CHP system that helps cut peak loads and CO2 emissions

◦ Promotion of Smart Energy Systems and energy saving assistance services

29.6 million t-CO2

Actions

LNG Procurement

Business Activities

Customer Sites

SCOPE 1 and 2

*Source: “Study of Life Cycle Greenhouse Gas Emissions of LNG and City Gas 13A” (Proceedings of the annual meeting of Japan Society of Energy and Resources 35, pp. 23–26, 2016)

Heat supply centers, offices, etc.

Coal▶

Oil▶

Natural gas▶

80

100

▶

CO2

60 ▶

100

NOx(nitrogen oxide)

40

70

100▶

SOx(sulfur oxide)

0

70

Source: Agency for Natural Resources and Energy, Energy White Paper 2013

Source: “Future Forecast for Life Cycle Greenhouse Gas Emissions of LNG and City Gas 13A” (Japan Society of Energy and Resources, presentation report 28 (2), pp. 51–56, 2007)

*1 This chart shows an example of energy efficiency by a CHP system on an LHV basis.*2 On an LHV basis, the thermal efficiency of thermal power plants and total loss

were calculated based on actual operation data for fiscal 2003 at nine electric power companies and electricity wholesalers (Energy Efficiency Standards Subcommittee, September 2005).

CO2 emissions Further reductions

STEP1Selection of optimum fuel

STEP2Selection of high-performance equipment

Application of a more efficient gas burner

45

Conventional System*2

Electrical energy 40%

Electrical energy 30–42%

Waste heat that can be used effectively 30–55%

Combined Heat and Power (CHP) System*1

Waste heat, transmission loss and other loss 60%

Waste heat that is difficult to use 15–30%

Thermal power station

40%

Total energy efficiency

Primary energy (natural gas)

100%

Primary energy (oil, coal, natural gas and others)

100%

City gas

Electricity

CustomerLNG Terminal

Customer

70–85%

Total energy efficiency

▶ ▶

75100

Heavy oil A + conventional burner

Replaced by natural gas

Climate Change CountermeasuresThe Tokyo Gas Group is endeavoring to reduce CO2

emissions across its entire LNG value chain to develop

a low-carbon society by setting guidelines for climate

change, not only for our business activity stage but also

for the customer site stage, where CO2 emissions are

relatively large.

In light of the Paris Agreement adopted at the COP21

conference as well as movements against climate change

in Japan, we have been actively pursuing low-carbon

initiatives. These include implementing a wider use of

natural gas, which has a lower CO2 emission factor,

developing and expanding Smart Energy Networks

The Tokyo Gas Group’s greenhouse gas emissions in fiscal 2017 were approximately 40 million t-CO2.

(for SCOPE 3 data, only major categories were calculated)

(SENs) that combined heat and power (CHP) systems and

other highly efficient equipment with advanced energy

management and embracing digitization technologies and

innovation.

In our electric power business, we will develop an

optimal power source portfolio with eco-friendly natural

gas-fired power plants, renewable energy and so on.

Furthermore, in our overseas business we will deploy

technologies that excel in reducing CO2 emissions and

energy consumption across our LNG value chain as a

contribution to global efforts to address climate change.

● Greenhouse Gas Emissions along the LNG Value Chain

● Comparison of Emissions during Combustion (Coal = 100)

Third-party Assured

Natural gas is primary composed of methane (CH4),

which contains a smaller proportion of carbon atoms

in its molecule compared to oil or coal. Moreover, it

characteristically produces the least CO2 among fossil

fuels when burned. Also, since sulfur compounds and

impurities are deeply removed during the liquefaction

process, natural gas produces almost no SOx, which

makes it the most environmentally sound fossil fuel.

Emissions of CO2 are dramatically reduced by switching

away from the use of fuels such as oil and LPG to

natural gas and by supplying natural gas to power plants.

Emissions can be further reduced by installing more

efficient industrial burners and furnaces when switching

fuels.

CHP systems are distributed energy systems fueled by city

gas to produce electricity at the customer’s site, utilizing the

heat generated for cooling, heating, hot water and steam as

well. Thus, the system achieves high total energy efficiency,

which contributes to energy saving and CO2 emission

reduction, by wasting less energy in the process.

Combination with renewable energy sources having

unstable output is another value of the CHP systems. And

the system can serve as the core component of the Smart

Energy Network, thus significantly contributing to the

realization of a low-carbon society.

● Environmental Advantages of Natural Gas

● Environmental Advantages of City Gas in Terms of Lifecycle CO2 Emissions

● Switching to Natural Gas and More Sophisticated Use

● Popularizing CHP Systems

Greenhouse gases are released not only when fossil fuels

are burned but also when they are extracted, processed

and transported. Therefore, it is important to take into

account emissions throughout the fossil fuel lifecycle.

From the lifecycle perspective, natural gas generates

the lowest CO2 emissions of any fossil fuel and city

gas generates extremely low energy loss during its

manufacturing and supply.

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201826 27

Establishment of Japan H2 mobility, LLC

◦ Confirmation of the status of consideration for biodiversity during the development of source gas fields

◦ Habitat monitoring, greening, conservation activities at LNG terminals

◦ Power plant environmental impact assessment

Loss of biodiversity around gas fields Impact on ecosystems during operation

1. LNG procurement

◦ Ballast water management during transport by Tokyo Gas owned/managed vessels

Ecosystem disturbance by invasive species

2. LNG transport City gas productionPower generation

◦ Reduce the amount of excavated soil removed from pipeline construction sites

Biodiversity loss due to mountain sand excavation

◦ Use of Tokyo Gas Recycled Paper and Forest Stewardship Council (FSC®) certified paper

◦ Greening activities

◦ Conservation activities at Nagano Tokyo Gas Forest, Watashi no Mori (My Forest) Project, and others

◦ Support for NPOs via the Mori Sato Umi Tsunagu (Connecting Forests, Villages and Ocean) Project and Keidanren Committee on Nature Conservation

Biodiversity loss due to illegal logging for paper products

5. Offices 6. Together with customers and local communities

3.

Used polyethylene (PE) gas pipes are collected for recycling into items such as the tags attached to customers’ gas meters that explain how to restart meters in case of an earthquake.

Reduce Reuse Recycle

247tons100%

Reuse gas metersGeneral waste reduced Recycling rate for used gas pipes(PE, steel and cast-iron pipes)

Volume of Tokyo Gas Recycled Paper

Power generation efficiency(LHV)

(%)

Supply-side output (kW)

40

35

45

55

50

10 1,0001 100 10,000 100,000

Gas engines

SOFC

Gas turbines

●

●

GS16R2( 1,000 kW )

SOFC( 3 kW )

Average efficiency of thermal power stations in Japan (demand-side)

4. City gas supplyPower transmission (general power transmission utility)

Promotion of Resource Saving and Recycling Promotion of Environmental Technologies Development

Promotion of Biodiversity Conservation

The Tokyo Gas Group strives to create a recycling-based

society by implementing its Guidelines for Promoting

Resource Saving and Recycling and rigorously practicing

the 3Rs of reduction, reuse, and recycling of waste across

the Group. Specifically, we seek to achieve zero waste

emissions at production sites, reduce the amount of soil

excavated during gas pipeline construction, reuse old gas

meters and recycle used gas pipes at every stage of our

business activities.

The Tokyo Gas Group endeavors to secure biodiversity

and achieve coexistence with nature by setting its

Guidelines for Promoting Biodiversity Conservation,

monitoring the impact of its business activities on the

environment along the LNG value chain, and taking steps

Third-party Assured

392 thousand gas meters

to reduce its impact on ecosystems. Moreover, we

engage in conservation activities in forests and satoyama

woodlands near populated areas and the sea with our

customers and local communities as activities aimed at

contributing to the environment and society.

● Impacts on Biodiversity and Responses along the LNG Value Chain

● Power Generation Efficiency of CHP Systems

To reduce carbon emissions in the transportation sector,

Tokyo Gas is building and operating hydrogen stations

(hydrogen ST) to promote the wider use of fuel cell

vehicles powered by hydrogen. We have already opened

three hydrogen stations—Nerima Hydrogen ST, Senju

Hydrogen ST in Tokyo, and Urawa Hydrogen ST in Saitama

Prefecture—as our contribution to the development of the

hydrogen society.

In February 2018, we jointly established Japan

H2 mobility, LLC (JHyM) with ten other companies,

including infrastructure businesses, automobile makers

and financial investors, with the aim of accelerating the

pace of developing hydrogen stations. This world-first

collaboration will pursue an initiative for the strategic

development and efficient operation of hydrogen stations.

Tokyo Gas will construct and operate hydrogen stations as

an infrastructure company in collaboration with JHyM.

CHP systems have led to growing expectations from

customers from the perspectives of environment, energy

saving and BCPs (business continuity plans). These systems

have the potential to spread once further enhancements are

made to economic efficiency and energy security.

Technologies for enhancing thermal efficiency and

achieving precise control of combustion have led to

significant improvements in the power generation efficiency

of gas engines used in CHP systems. Large-scale gas

engines with a capacity of 5,000 kW or higher now boast

power generation efficiency approaching 50%, while the

majority of medium-class gas engines with 300 kW to 1,000

kW capacity now offer efficiency ratios of 40% or higher. In

April 2017, we launched our 1,000 kW-class CHP system

GS16R2, which offers improved performance compared

to the preceding model. It achieves a power generation

efficiency of 42.5%, a total efficiency of 80.1%, and enjoys

robust sales.

In future, such systems are expected to be capable of

an even higher power generation efficiency by introducing

solid oxide fuel cells (SOFCs) that operate in higher

temperatures. Tokyo Gas has evaluated the durability and

effects on reducing energy consumption and CO2 emissions

demonstrated by commercial SOFC systems during actual

operation and have confirmed the energy conservation

effects at these sites. Using these results, we are currently

promoting sales of the 3 kW-class SOFC system we

commercialized in June 2017, which features a power

generation efficiency of 52.0% and total efficiency of 90.0%.

The Tokyo Gas Group has consistently developed

technologies for reducing energy consumption and

CO2 emissions. However, to further bolster efforts to

create a low-carbon society, we must move beyond our

proprietary technologies and embrace innovative ideas

and technologies from around the world. To that end,

we are promoting open innovation style research and

development. In fiscal 2017, we set up two specialized

companies in the United States, Acario Investment One

LLC and Acario Innovation LLC, and began investing

in venture capital firms and venture businesses that

specialize in energy technologies. We will seek closer

collaboration with startup ventures and companies that

have innovative business models toward meeting the

demands of a low-carbon society.

● Infrastructure Improvement for Hydrogen Supply ● Technological Innovations in Combined Heat and Power (CHP) Systems

● Contributing to the Creation of a Low-carbon Society through Innovation

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Risk

Resp

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113 tons Year-on-Year

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201828 29

Nurturing ChildrenWe support efforts to provide a better future for children overseas and in Japan through the volunteer work of our employees.

The Tokyo Gas Southeast Asia Japanese Language Education Support program is operated through Japanese language programs organized by the Japan Foundation. In Vietnam we offered classes and assistance on writing graduate theses for university students learning Japanese and presented a lecture for Thai students on the current energy situation and future outlook in Japan and Thailand. We value our ties with local communi-ties for nurturing the next generation as a business group that can be trusted and counted on outside Japan.

By collecting spoiled postcards from employees since 2003 and donating them to the Darunee Scholarship Fund, administered by EDF-Japan (MINSAI Center), we are contributing to the ed-ucation of children overseas. Specifically, the proceeds are used to fund an international foster parent program, which enables underprivileged children in Vietnam, Thailand, Myanmar, Laos and Cambo-dia to continue their educa-tion. As of autumn 2016, we are supporting three girls in junior high school in Laos.

Social Action Programs

Volunteer Activities

● Building Communities and a Way of Life that Is Safe and Secure

● Building a Society and a Way of Life that Is Good for the Environment

● Enriching Our Life and Culture

The Tokyo Gas Group works hand in hand with local residents to develop safe communities

where everyone can live with a sense of security. We also offer proposals aimed at enriching daily lives

through the continued use of energy and support para sports to help create a society in which diverse

people can enjoy fulfilling lives.

* Cumulative total since 2002.(Figures for the Tokyo Gas Group as of end of March 2018)

TOKYO GAS TOP > CSR Report > Contribution to Local Communities >Targets and Performance

https://tokyo-gas.disclosure.site/en/themes/109WEB

3Contribution to

Local Communities

Number of Participants in Classes Taught by Tokyo Gas Employees

in the School Education Support Activity*

1,102,087> Page 31

Tokyo Gas Southeast Asia Japanese Language Education Support Program

Supporting Children’s Education by Collecting Spoiled Cards

Lecture at a university in Thailand

TOPICS

Darunee Scholarship certificate

Number of Para Sports Support Leaders for

Creating an Inclusive Society

301

Number of Smart Energy Network

Projects for Urban Development

> Page 32projects

leaders

students

14

Key CSR Activity

> Page 33

Our branch offices take part in local disaster prevention

drills and organize events at the Gas Science Museum,

providing information on disaster prevention in

collaboration with local communities toward improving the

regions where people live in safety.

To play our part as an energy company in creating a

sustainable global environment, we seek to enhance

environmental awareness and action by supporting school

programs that teach the importance of energy and the

environment to children, who represent the future, and

the Donguri (Acorn) Project for providing experience-based

environmental education.

We provide employees with opportunities to engage in

volunteer activities working alongside local communities

in tackling social issues.

Since launching our volunteer work program in 2011,

1,700 Group employees and their families have taken

part in support activities tailored to the needs of the areas

affected by the Great East Japan Earthquake.

The Tokyo Gas Group has also participated in volunteer

work for organizing para sports competitions in Japan as

an official partner of the Japanese Para-Sports Association

(JPSA) since 2013.

We organize community-based activities to enable

participants to lead more comfortable lifestyles by learning

how to more effectively use energy. These include

our hands-on HIIKU fire education program in which

participants learn about the characteristics of fire and how

best to handle it, as well as the power and benefits of fire,

and cooking classes that convey the appeal of cooking

over a gas flame.

We also engage in activities to support para sports

toward creating an inclusive society in which diverse

people can lead fulfilling lives.

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201830 31

S N

CHP CHPHeat source equipment

Information

Heat

Electricity*2 *2Heat source equipment

　　　　　　Supporting Para Sports to Build an Inclusive SocietyTOPICS

Last year Tokyo Gas held a multi-day Universal Festa on October 28 and 29 in Toyosu, and then on November 17 and 18 in Shinjuku to mark the 1,000 days before the start of Olympic and Paralympic Games Tokyo 2020. The event offered a wealth of opportunities to deepen understanding of the concept by recreating the sights, sounds and feelings of the upcoming sports competitions from panel discussions with athletes and experts on universal society and community development to activities allowing participants to directly experience para sports and using wheelchairs. The two sites attracted 4,000 visitors during the event’s four days.

Since February 2017, we have been organizing field trips for schools to learn about para sports. Students were able to try on sports prosthetics at the Shin-toyosu Brillia Running Stadium to gain an understanding of competing with disabilities and developed a greater interest and understanding in para sports.

Tokyo Gas is an Official Partner of the Olympic and Paralympic Games Tokyo 2020 in the Gas & Gas Utility Services category. As a company that has supplied the Tokyo metropolitan area with energy and sustained daily life, we view this as an opportunity for contributing to the

Tokyo Gas became an official partner of the Japan Para-Sports Association in 2013 and began offering its support to para sports. Group employees have volunteered to organize sports competitions and held viewings and supporting events. We have also partnered with local governments to provide opportunities for experiencing para sports. We believe that these activities will cultivate a better understanding of people with disabilities and serve as an opportunity to develop a barrier-free mindset. Through the activities, Tokyo Gas aspires to realize an inclusive society in which people respect and support each other and lead vigorous lives in safety and comfort.

Supporting the Tokyo 2020 Games to Create an Inclusive Society

Events Marking 1,000 Days before the Games

Support for the Tokyo 2020 Games and Beyond

Tokyo Gas will work toward the success of the Tokyo 2020 Games and support them as an Official Partner. In addition to providing infrastructure, we will strive to instill a barrier-free mindset for everyone.

Supporting the Paralympic Games and para sports is the first step for Japan in becoming a highly mature society that embraces diversity. The Tokyo 2020 Games represents a great opportunity for Japan to transform itself. In anticipation of 2020 and beyond, Tokyo Gas will make its best effort to contribute the creation of an inclusive society.

● SEN for the Northern District Adjacent to the East Exit of Tamachi Station

Optimum Control, Centralized Management and Information System for Energy Supply and Demand

Pedestrian deck Fuel battery

Fuel battery

Supply to Block I during a power outage (planned)

Area-wide heating

Solar heat

Underground tunnel water

Solar heatSolar light

Solar heatSolar light Solar light

Wind power

Block II Smart Energy Center

Block I Smart Energy Center

SENEMS®*1

S Offices/Commerce N Offices/Commerce

Public facility

Hotel Nursery schoolElementary school

(planning stage)

Hospital

To create an inclusive society and contribute to regional development

2020年とその先を見据えた

“東京ガスだから”できる活動

Activities showing what

Tokyo Gas can do, with a view to 2020 and beyond

Advanced energy initiatives in the

Athletes’ Village and the venues

Supporting para sports

Providing services that improve the quality of life and support

communities

Engagement in general social issues

Stable and secure energy supplies (LNG terminals,

pipelines, etc.)

Promoting the Smart Energy Network Developing SEN in the Northern District Adjacent to the East Exit of Tamachi Station

We have been developing smart energy networks (SENs)

that optimize local generation and consumption of energy

by linking heat, electricity and information networks

toward making communities more energy efficient,

environmentally friendly and resilient to disasters.

Centered on a CHP system, SENs raise energy efficiency

by making maximum use of renewable and underused

energy sources, which are integrated with information and

communications technology (ICT) to accurately manage

supply and demand.

In this way, SENs reduce CO2 emissions and

ensure the consistent supply of electricity and heat

in an emergency, thereby helping make cities more

environmentally friendly and disaster resistant, and

ultimately enhancing their value. The smart energy

network developed in redevelopment zones in the Greater

Tokyo Area, including the northern district adjacent to

Tamachi Station’s east exit in Tokyo, received the Minister

of Economy, Trade and Industry Award in the Successful

Case of Energy Conservation category at the Energy

Conservation Grand Prize awards in fiscal 2016.

In 2014 the Block I Smart Energy Center, part of the

SEN project in the Northern District adjacent to the East

Exit of Tamachi Station was completed within the Life

Zone and began supplying heat and electricity to Minato

Park Shibaura, a public facility, hospital and child welfare

facility. In May 2018, the Block II Smart Energy Center

began operations within the New Urban Zone and started

supplying energy to office buildings and a hotel. This

public-private project is intended to optimize energy

management across the entire area by having the two

SENs supply heat to each other, thereby reducing CO2

emissions by 30% below 2005 levels.

Linking the two networks has also made it possible

to construct an emergency backup system, which will

further enhance energy security and contribute to building

a disaster-resilient city.

　 Reaching for a Future that Lies beyond the ExcitementVOICE 　　　　　　　　　　　　　　　　　 Yumiko Yao General Manager, Tokyo 2020 Olympic and Paralympic Dept.

success of the event and realizing our goal of creating an inclusive society. We will particularly pursue activities in the areas of supporting para sports, providing services to improve the quality of life and to support communities, engaging in social issues, ensuring stable and secure energy supplies, and implementing advanced energy initiatives in the Athletes’ Village and the venues.

Moreover, engaging in activities that look beyond the Tokyo 2020 Games will allow us to better meet the needs of an aging population and globalized society toward realizing greater prosperity and comfort in our daily lives and communities, leading to the creation of an inclusive society and contributing to regional development.

*1 Smart Energy Network Energy Management System*2 CHP systems

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201832 33

17,773 * Training sessions with 20 participants were also given by instructors dispatched on request by government authorities.

❶　Our Commitment to Respect Human Rights❷　Scope of the Policy❸　Respect for Human Rights in Our Value Chain❹　Human Rights Due Diligence❺　Relief and Remediation❻　Dialogue and Consultation❼　Human Rights Education❽　Information Disclosure

Tokyo Gas Group Human Rights Policy (Item Titles)

Level-specific human rights awareness training

Overview Participants

Level-specific training

Four levels of training provided: upon entry to the company, during the third year, and during qualification promotions (two levels). Training includes Tokyo Gas LIFEVAL employees.

1,527

Workplace workshops

Practical training on topics selected by each workplace 15,543

Training programs and follow-up for human rights promotion leaders

First-time leader training (1 year) and follow-up training 353

Human rights presentation

Presentations for mid-level managers by outside speakers 350

225 867

The Tokyo Gas Group engages in business activities with respect to the dignity and

rights of all people, and it has pursued various educational initiatives to raise employee

awareness of the importance of observing such rights. We will intensify our efforts in

response to the increasing globalization of society and to address the issues that arise

while we expand our overseas business.

Respect for Human Rights

4Key CSR Activity

Number of participants in human rights awareness

training*1

Number of human rights promotion leaders*2

Number of sessions (including anti-harassment

training)*1

*1 Figures for the Tokyo Gas Group in FY2017

*2 Figure for the Tokyo Gas Group as of end March 2018

We will continue to strengthen our efforts related to

respecting human rights in accordance with Tokyo Gas

Group Human Rights Policy, which was formulated in

February 2018. The Group strives to practice human rights

due diligence in order to identify, prevent and mitigate

human rights issues that arise along our value chain.

Consultation desks have been established both inside the

company (in the Compliance Department) and outside the

company to handle workplace issues on communication

and compliance, including human rights. A total of 104

consultation requests were received in fiscal 2017 (please

see page 37).

First and foremost, we seek to protect the person who

is seeking consultation from being placed at a disadvantage.

And we address issues through face-to-face consultations

whenever possible in an effort to help create a safe

and secure working environment by collaborating with

employees.

As part of our initiatives for respecting human rights along

our supply chain in Japan and abroad, we present our

suppliers with the Purchasing Guidelines for Suppliers and

engage in management activities such as CSR surveys.

Additionally, we seek to ensure understanding of these

guidelines and stringent adherence among our employees

to Tokyo Gas Group Our Code of Conduct. Furthermore,

we monitor the status of response to human rights issues

by conducting surveys of suppliers.

Tokyo Gas signed the United Nations

Global Compact in March 2016 to

demonstrate its commitment to

protecting and respecting human

rights and labor standards as it

pursues overseas businesses.

We seek to raise

our awareness

by understanding

the latest trends

in human rights

surrounding

companies and

learning about

human rights

issues through various educational activities and training.

In March 2018, we organized a human rights lecture on the

Initiatives on Respecting Human Rights

Training and Lectures on Human Rights

Signing of the UN Global Compact

Consultation Desks for Human Rights and Compliance Issues

Respecting Human Rights along the Supply Chain

theme of “workplace tips for creating an inclusive society

alongside people with disabilities.” About 350 attended

the lecture, including Central Human Rights Promotional

Meeting members of Tokyo Gas and managers of

subsidiaries.

● Human Rights Awareness Training*

(Figures for the Tokyo Gas Group in FY2017)

TOKYO GAS TOP > CSR Report > Respect for Human Rights > Targets and Performance

https://tokyo-gas.disclosure.site/en/themes/112WEB

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201834 35

Consultation Topics Cases

Interpersonal relations and employment matters 35

Laws and regulations 4

Internal regulations 7

Communication and other issues 58

Total 104

● Prohibition of overseas bribery activities

● P rohibi t ion of fac i l i tat ion payment

● Prohibition of inappropriate hospitality, gift, invitation and overseas donation etc.

● Prohibition of bribery (other than with foreign public officials)

● Transactions with third parties● Relationships with joint venture

partners

● Prohibition of corruption● Mergers and acquisitions● Prohibition of accounting

fraud● Internal reporting

responsibility/investigation cooperation responsibility

● Emergency response● Disciplinary measures● Training and monitoring

“Foreign Public Official Anti-Bribery and Corruption Guidelines” Categories

Tokyo Gas

Information security promotion system of each Group company

Collaboration Collaboration Collaboration

Information security promotion system of each Group company

Information security promotion system of each Group company

Subsidiaries Tokyo Gas LIFEVAL

Partner Companies

Information Security Promotion System

Information Security Management Officer

Information Security Executive Officer

Information Security Promotion Manager

Officer designated

with security clearance

(concurrent position)

Officer designated

with security clearance

Officer designated

with security clearance

Information Security Leaders

Employees

Information security promotion system of each division and department

Information Security Committee

(Chair: General Manager of IT Management

Department)

IT Management Department

Top management

28,726

更新

100%

21,342

Major changes in the business environment have led to a growing need for management that places

greater emphasis on compliance. In order to establish a compliance structure capable of meeting

these changes, the Tokyo Gas Group will exercise more stringent compliance and pursue its business

activities in a fair and transparent manner.

Promotion of Compliance

5Key CSR Activity

Rate of Participation in Workshops on

Preventing Bribery and Corruption Involving

Foreign Public Officials

Number of Participants in the Compliance Awareness

Workshop

Number of Employees Taking E-learning Courses on

Privacy Protection

(Figures for the Tokyo Gas Group in FY2017)

We have created a structure centered on the Management

Ethics Committee, chaired by the president, in which

compliance managers and compliance promoters are

appointed at each workplace to engage consistently and

proactively in initiatives for promoting compliance. At the

Group level, we pursue compliance by sharing the values

and standards of conduct as stipulated in Tokyo Gas Group

Our Code of Conduct.

We have developed a system for consultations on

compliance to receive from Group companies and also

business partners. We endeavor to discover and resolve

problems at an early stage so that the company’s self-

regulating processes function effectively.

The Tokyo Gas Group has developed a system for

appropriately protecting and managing the vast amount of

personal information it possesses and uses.

To ensure stringent compliance with laws and

regulations, we review our in-house rules and manuals as

needed, have each department take regular inventory of

personal information under their care, and check the status

of personal information management during internal audits.

In April 2017, we revised our pamphlet that explains the

practical aspects of the Act on the Protection of Personal

Information and distributed it to all Group employees.

Furthermore, to prevent accidents and minimize their

impact, we have set up information security promotion

systems for each division and department, installed

hardware to protect against unauthorized access and

provided information security education.

The Tokyo Gas Group complies with the laws and regulations

of each country and region where it operates and makes a

thorough effort to prevent bribery and corruption.

In line with the expansion in our overseas business, we

have established the Basic Policy On Overseas Business

Compliance Promotion Structure

Protection of Personal Information

Prevention of Bribery and Corruption Involving Foreign Public Officials

● Number of Cases Handled by Consultation Desks(Figures for the Tokyo Gas Group FY2017)

● Information Security Promotion System Chart

Promotion, which pledges to carry out equitable and

transparent corporate activities. In particular, bribery and

corruption not only damages social credibility but can also

hamper economic growth in developing countries. We have

thus formulated the Foreign Public Official Anti-Bribery and

Corruption Guidelines to outline specific actions we must take.

We seek to disseminate these guidelines so they become

established among overseas business partners. Moreover, we

are creating a system for consultation and reporting for local

employees of overseas affiliates and monitoring the situation

through internal audits and other means in an effort to prevent

bribery and corruption.

TOKYO GAS TOP > CSR Report > Promotion of Compliance > Targets and Performance

https://tokyo-gas.disclosure.site/en/themes/115WEB

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201836 37

Target Action PlanRatio of women in management posit ions in FY2020

❶ Increase percentage of female job applicants❷ Create more opportunities for female employees❸ Increase the number of women pursuing management positions❹ Identify and tackle other issues (PDCA cycle)

Program Participants

Parental leave (until the end of April immediately following the child’s 3rd birthday) 50 (5 males)

Percentage returning to work (percentage of employees taking parental leaves each fiscal year who returned to work at the company)

93％

Shorter hours for parents of small children(during pregnancy and until the child completes the 6th grade)

217 (3 males)

Nursing care leave (up to 3 years) 1

Nursing care work (up to 3 years) 2

Community service leave (special leave for up to 5 days within 1 year) 58

Sabbatical system (for employees who reach the ages of 30, 35, 40 and 50) 673

Leave to accompany partner (for employees accompanying a spouse posted overseas) 3

7.6 %

13.5hours

100 %

10%

External Evaluation

Kurumin CertificationCertified in 2015 after completing an action plan formulated under Japan’s Act on Advancement of Measures to Support Raising Next-Generation Children.

Nadeshiko BrandSelected in fiscal 2017 for the second consecutive year as a company that actively encourages empowering women in the workplace.

Certified Health & Productivity Management Organization

Certified in fiscal 2017 for the second consecutive year as a company pursuing a strategic effort on employee health management from a business perspective.

Third-party Assured

Third-party Assured

6Key CSR Activity

With a view that a company derives vitality from its employees and that corporate

growth cannot be achieved without the growth of its personnel, the Tokyo Gas

Group pursues various measures related to its people. We seek to further bolster

our management base by creating work environments that bring out the best of our

employees, who are the driving force of our business operations.

Enhancement of People-Centered

Management Base

Ratio of Women in Management *1

Average Training Hours per Employee *3

Percentage Receiving Medical Checkups *2

*1 Figure for Tokyo Gas as of April 1, 2018*2 Figure for Tokyo Gas in FY2017

*3 Training provided by the Tokyo Gas Personnel Dept. in FY2017

The Tokyo Gas Group has set up a Group Diversity Promotion

Team in the Personnel Department which works closely

with management to ensure that employees can thrive by

fully demonstrating their knowledge, skills and experience,

regardless of their gender, age, disability, employment

status, nationality, sexual orientation or gender identity. To

support employees from various backgrounds, we create

agreeable work environments by employees from various

backgrounds by broadly addressing issues of diversity,

including the promotion of women’s careers, increasing

employment of persons with disabilities, and developing

career opportunities for employees in their 50s or older.

Tokyo Gas takes a two-pronged approach to training

personnel: developing basic and common skills required

of a businessperson and enhancing specialized skills. Our

training includes programs that are open to participation by

employees at Group companies in an effort to develop human

resources on a Group-wide basis. Every year, we provide

employees with opportunities to discuss their career plans

with their supervisor. Their self-evaluation, together with

the remarks made by the supervisor, are registered in the

personnel system and used in decisions related to transfers

and rotation plans as well as in career development. We

endeavor to place the right person in the right place so that

employees will find their work rewarding, by establishing an

Open Recruitment program and a Free Agent program to

enable them to apply for the position of their choice.

Tokyo Gas has in place an occupational safety and health

management system to prevent industrial accidents. This

includes further reinforcement of the occupational safety

and health activities undertaken by each workplace on a

daily basis and also risk assessments to quantify and reduce

disaster-related risks. In addition, we have established

an in-house driving license program and are introducing

assisted- and self-driving vehicles with the aim of preventing

traffic accidents. We also remain focused on educating

employees, which involves organizing level-specific training

related to occupational safety and health and other safety

considerations.

We have created the Health Insurance & Employees’

Welfare Section within the Personnel Department, and

a team of industrial physicians and nurses administer

occupational health activities. With the aim of ensuring that

each and every one of our employees receives a health

checkup, with a view to the early detection of diseases,

we make effective use of outside medical institutions and

follow up on employees who require further attention.

In addition, we are also committed to preventing mental

diseases.

We recognize work style reform as an important

management issue and are actively rethinking the way we

work by emphasizing the value of “time” to rectify and

reduce long working hours. In fiscal 2018, we will formulate

a Work Style Action Plan and concentrate on three

focus areas: rectifying long working hours, encouraging

employees to take annual leave, and promoting flexible

work styles. Furthermore, we are utilizing ICT to reform our

Promotion of Diversity

Development of Human Resources

Occupational Safety and Health

Maintaining and Enhancing Health

Work Style Reform

● Action Plan for Promoting Women’s Careers (Tokyo Gas Co., Ltd.)

● Major Programs and Number of Users (FY2017)

operations, fully introducing telework from fiscal 2017 and

promoting the use of RPA (robotic process automation).

TOKYO GAS TOP > CSR Report > Enhancement of People-Centered Management Base > Targets and Performance

https://tokyo-gas.disclosure.site/en/themes/118WEB

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Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 201838 39

Corporate Governance

13 Board of Directors External

Director 3Audit & Supervisory Board Member

3

Internal

Director 5Audit & Supervisory Board Member

2

5 Advisory Committee Members

External

Director 2Audit & Supervisory Board Member

1

Director, Chairman of the Board 1Representative Director, President and CEO 1

11 Corporate Executive Meeting Members

Representative Director, President and CEO 1

Executive Vice President 2Senior Managing Executive Officer 2

Managing Executive Officer 65 Audit & Supervisory Board Members

ExternalAudit & Supervisory Board Member

3

InternalAudit & Supervisory Board Member

2

100（%）0 20 40 60 80

ComplianceEstablishment of code of

conduct on compliance

Implementation ofcompliance education

90.2 9.8

95.0 5.0

Risk ManagementEstablishment of emergency

response to disasters 96.8 3.2

Human Rights and Employment Conditions

Establishment of code ofconduct on human rights

and employment conditions84.5 15.5

EnvironmentActivities to reduce

CO2 emissions 100

Proper disposal of waste andactivities to reduce

waste volume83.0 17.0

■Yes, we have taken action　■No, we have not taken action

● Principles and Standards of Purchasing Practice: code of conduct governing the purchasing activities of Tokyo Gas

● Purchasing Guidelines for Suppliers: requirements for doing business, including quality, legal compliance, labor, safety and human rights, environment, and local communities

● Green Purchasing Promotion Guidebook: environmental aspects of procurement that require consideration

Procurement Policies (Revised in FY2017)

Report and request approval

Management and approval

Management and approval

Report

Report and submit proposal

Report and submit proposal

AuditCollaboration

Audit

Collaboration

Report

Report

Appointment

Appointment

Audit, etc.

Collaboration

Audit

Supervision and approval

Appointment

Business departments

Subsidiaries

President and CEO

Inde

pend

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Audi

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uper

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y Boa

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Corporate Executive Meetings

Investment Evaluation Committee

Board of Directors Advisory Committee

　FY2017 Survey of Suppliers

Survey target 527 companies

Number of respondents 317 companies

ReportManagementReport and request approval

Committees related to important management issues (ethics,

safety, CS, etc.)

Tokyo Gas Co., Ltd.

General Shareholders’ Meeting

Supply Chain Management

TOKYO GAS TOP > CSR Report > Supply Chain Management > Basic Policy

https://tokyo-gas.disclosure.site/en/themes/176WEB

Tokyo Gas believes that it must fulfill its social responsibility

in cooperation with business partners, rather than doing

so on its own. We disclose our procurement policies in

order to forge relationships of trust with them and jointly

implement CSR initiatives. Together we will also enhance

our brand values of Safety, Security and Reliability through

a committed effort to pursue open, equitable and fair

purchasing activities based on these policies.

Under its management philosophy, Tokyo Gas seeks to fulfill and

bolster its corporate governance in order to increase its corporate

value by ensuring legality, soundness and transparency of

management. Simultaneously, it engages in appropriate, prompt

decision making, efficient business operations, enhancement of

the audit and supervisory functions, and clarity of responsibility of

management and operations.

Tokyo Gas has adopted and established a highly objective and

transparent governance system to invite outside directors and

Audit & Supervisory Board members to create multiple layers in

its audit and supervisory functions.

The Advisory Committee selects candidates for officers in

a fair and proper manner in response to an inquiry by the Board

of Directors. It also deliberates on the remuneration of officers,

based on the Basic Policy on Officer Remuneration, and submits

decisions to the Board of Directors.

Toward achieving accurate, prompt decision making and

efficient business execution, the Corporate Executive Meeting is

held once a week in principle.

In business execution based on the resolution of the Board

of Directors, by introduction of an executive officer system, the

Board of Directors delegates substantial authority to executive

In compliance with Japan’s Corporate Governance Code, Tokyo

Gas has stipulated its Basic Policy on Corporate Governance.

To achieve sustainable growth and increase its corporate

value over the medium- to long-term, we will collaborate with

our stakeholders, ensure appropriate information disclosure

and transparency, and fulfill the commitment of the Board of

Directors, and at the same time, we will pay due consideration

to communicating and gaining the understanding of stakeholders

including shareholders.

We disclose information on major procurement items and

procurement procedures on the corporate website and

provide opportunities for participation as needed. When

starting a new business relationship, we screen our new

partner to check the status of their CSR activities in addition

to the basic requirements.

With respect to our suppliers, we conduct a survey

each year on the overview of each company and their

efforts on compliance and the environment, and we meet

with management when the survey results indicate that

meetings are necessary.

Furthermore, we engage in two-way communication

with our suppliers by sharing information during meetings

on a daily basis.

Since fiscal 1996, Tokyo Gas has been practicing green

purchasing, which places priority on purchasing products and

services with lower environmental impact.

We ask that suppliers adhere to specifications based

on our Purchasing Guidelines for Suppliers and Green

Purchasing Guidelines. With each order commissioning

construction and other work, we present suppliers

with our Specifications for Common Environmental

Management, which stipulates that legal compliance be

considered and environmental impact be reduced, and

includes information related to occupational safety and

health while seeking suppliers compliance.

Basic Policy on Procurement Basic Policy

Outline of Implementation System of Corporate Governance

Compliance with Japan’s Corporate Governance Code

CSR Procurement Initiatives

Green Purchasing Initiatives

● Results of FY2017 CSR Survey of Suppliers

officers in their designated criteria of responsibility by resolution.

On the other hand, the directors supervise those executive officers

in an appropriate manner and in accordance with a report they

receive on the status of business execution by executive officers,

if needed, which is submitted to the Board of Directors.

● Corporate Governance Overview(as of June 28, 2018)

● System for Promoting Corporate Governance (as of June 28, 2018)

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40 41Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 2018

〉〉 Comments from KPMG AZSA Sustainability Co., Ltd.

Editorial Policy Third-Party Independent Assurance Report

Tokyo Gas Group CSR Report

● BookletA compact yet comprehensive source of information on the Group’s CSR initiatives.

● Website(full report with detailed information)

In addition to the information contained in this report, more detailed information on the Group’s CSR initiatives can be found on our website presented under each of our six Key CSR Activities.

● Approach to CSR Disclosure

This report (digest)

Website (full report)

Importance to the Tokyo Gas GroupHigh

Impo

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rs

High

● Annual Report 2018This report brings together carefully selected financial data and basic information on business strategy and other related topics for the latest fiscal year to help investors better analyze the Tokyo Gas Group.

● Tokyo Gas Earthquake Disaster Prevention MeasuresThis booklet describes earthquake preparedness measures taken by Tokyo Gas.

● Tokyo Gas Social Contribution Activities (Japanese Only)

This booklet describes the social contribution activities that the Tokyo Gas Group pursues to ensure safety and security, protect the environment and enrich life and culture.

CSR Communication Tools

● PeriodThis report contains material primarily from fiscal 2017 (April 1, 2017 to March 31, 2018), with some additional information from other fiscal years.

● ScopeTokyo Gas Co., Ltd. and its subsidiaries. Tokyo Gas LIFEVAL and partner companies are also included in some sections.Environmental performance data for fiscal 2017 are for Tokyo Gas and its 46 consolidated subsidiaries in Japan.

● Date of PublicationNovember 2018 (The previous report was published in November 2017. The next report is scheduled for November 2019.)

● Referenced GuidelinesGRI “Sustainability Reporting Standards 2016”Ministry of the Environment of Japan “Environmental Reporting Guidelines (2012 Version)”Japanese Standards Association “ISO 26000: 2010”

● Supplementary Information on Descriptions Used in the ReportCompany names and positions are as of the time of writing.

● Third-party AssuranceContent that has been third-party assured is indicated by a “Third-party Assured” symbol.

The Tokyo Gas Group CSR Report describes how we

perceive society’s expectations and the challenges we

face, and how we pursue CSR activities across the LNG

value chain, which forms the core of our business.

Compiled as a compact yet comprehensive resource,

it provides an overview of the Tokyo Gas Group’s

initiatives for a broad range of stakeholders. Details of our

initiatives are available on our corporate website, which

offers expanded search functions.

Our main initiatives in fiscal 2017 have been

categorized and presented in this report under the six Key

CSR Activities.

https://tokyo-gas.disclosure.site/enWEB

The environmental and social

performance indicators provided

in this report (data on the

environment and human resources)

have been third-party assured by

KPMG AZSA Sustainability Co.,

Ltd. (a member of the KPMG Japan

group) to enhance their credibility.

We will work to further raise the

standard of our CSR activities in

the future, taking account of the

issues pointed out in the course of

the third-party assurance process

and the reader feedback received

via our website and other channels.

Third-party Assured

The Tokyo Gas Group CSR Report 2018 introduces readers to the Group’s newly identified materiality. Previously, I had the impression that materiality was treated as an important item only with respect to information disclosure. However, Tokyo Gas Group has recently identified its materiality in terms of its relevance to the SDGs and categorized it into strategic issues and “fundamental business issues.” This indicates that the Group clearly recognizes its materiality in the non-financial areas of its management.

Considering that the strategic issues are of materiality to the Group’s core business of supplying energy, they necessitate a long-term vision that defines how the Group will generate social value and contribute to each issue up to 2030, the target year for achieving the SDGs.

Fundamental business issues are of materiality in the sense that they cover areas serving as the foundation for pursuing sustainable business activities. Until now, Tokyo Gas Group has been making a Group-wide effort on diversity and work style reform for its human resources in Japan. As the Group continues to procure LNG and develop its global business, it will face challenges in handling overseas suppliers and employees. I expect that it will also provide a systematic response in line with its business activities and take an active stance on disclosing information on its efforts.

Shinichiro Akasaka

KPMG AZSA Sustainability Co., Ltd.

42 43Tokyo Gas Group Tokyo Gas GroupCSR Report 2018 CSR Report 2018

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.All rights reserved.　©2018 Tokyo Gas Co., Ltd

*THE INCLUSION OF Tokyo Gas Co., Ltd. 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 Tokyo Gas Co., Ltd. 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. STOXX ESG Leaders IndicesAs of September 2017

TOKYO GAS GROUPCSR REPORT 2018Published: November 2018

Planning and editing:

Production:

Corporate Communications Department, Tokyo Gas Co.‚ Ltd.1-5-20 Kaigan, Minato-ku, Tokyo 105-8527, JapanTOKYO GAS COMMUNICATIONS, INC.

Inclusion in socially responsible investment (SRI) indices As of November 2018

MSCI ESG Indexes*

FTSE4Good Index Series Morningstar Socially Responsible Investment Index

Ethibel Sustainability IndexExcellence Global

FTSE Blossom Japan

All electricity (100 kWh) used in the production (printing plates, printing, bookbinding) of CSR Report 2018 came from green power (wind power).

This report is printed on Tokyo Gas Recycled Paper (made from recycled paper from Tokyo Gas offices, trimmings from afforestation activities, and reused and unused wood materials).

Tokyo Gas is a signatory of the UN Global Compact advocated by the United Nations.