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Basic Concept of Personnel Management

Our employees are important assets. As such, we treat employees fairly and with respect. We also support our employees' diverse lifestyles and individual growth and are committed to growing together with our employees. Guided by our Basic Concept of Personnel Management established in September 2000, we have a wide range of human resource initiatives to protect these valuable assets and increase their value. Specifically, the Group conducts pro-active human resource development initiatives while taking into consideration fairness and soundness.

Our performance-based pay system is designed to maintain a balance between employees’ financial well-being and the company’s financial situation. This system is expected to reduce or eliminate employees’ financial concerns and give them a sense of security, allowing them to concentrate on their jobs, overcome challenges and achieve outstanding results.

In addition, the global human resources management system, ARMS (Advantest Resource Management System), was introduced on April 1, 2012 to serve as the basis for optimal global human resources allocation. The qualification system, fixed pay policy, and bonus policy have been standardized on a global level through this system, making our human resources system a fairer and more even one.

It is our hope that Advantest employees will retain their adventurous spirit to take on new challenges without fear of failure.
As we aim to further improve our organizational capabilities and attain an even sounder human resources system in the future, we plan to unify employee performance assessments, the promotion system, hiring practices, and training on a global level and construct a global database.

Advantest's human resources basic philosophy

At Advantest, we consider our employees to be indispensable business assets. We have established the following philosophy that underpins our personnel-related policies, and we are constantly working towards the achievement of this philosophy.

1. Focusing on results
   We promote a human resources system that highly regards and fairly handles employees that exhibit a can-do spirit with which they overcome challenges and achieve outstanding results.
2. Taking into consideration fairness and soundness
   We take constant care to ensure that all of our policies and systems are extremely objective, fair, and sound so that we can achieve the biggest and best results with our employees as a result.
3. Pro-actively supporting human resources development
   We actively support personnel that face self-development through persistent hard work in order to acquire advanced specialist knowledge and a broader education.

Establishment of the Human Rights Protection Committee

Since August 2007, when a difficult human rights issue that cannot be solved in the workplace occurs, it is referred to our Human Rights Protection Committee.

The Human Rights Protection Committee is composed of executives from the Advantest Labor Union and employees from the Health Promotion Office and Human Resources & General Affairs Department. Although the expansion of our business overseas in the future will be a challenge, we plan to respond by carefully considering the individual conditions of each country where we deploy our business.

We strive to create a stress-free work environment where all employees respect one another’s human rights.

Human rights education

Creating workplaces that respect human rights

The ADVANTEST Way and The Code of Conduct pledge that we will respect human rights without discriminating on the basis of age, gender, nationality, religion or other factors.

In addition, since April 2006 we have included training on human rights themes such as sexual and power harassment prevention in new employee training and new manager training.

In fiscal 2008 The Code of Conduct was revised to The ADVANTEST Way and The Code of Conduct to reflect these themes. As of fiscal 2011, training has been provided on these themes to approximately 170 new employees and approximately 80 new managers. We plan to continue providing education on these themes in the future.

Harassment prevention

To prevent sexual harassment and power harassment, in July 1999, we created a manual and placed it on the intranet for easy reference.

The key points are as follows.

1. Definition of sexual and power harassment
2. Sexual and power harassment in the workplace
3. Impact of sexual and power harassment
4. Sexual and power harassment prevention measures

We are working to devise methods for self-check that can be conducted in response to the issues above.

Employment of people with disabilities

Advantest Green Corporation (AGC) was established in September 2004 as a special subsidiary of Advantest for the purpose of promoting the employment of people with disabilities. Since then, AGC has been striving to offer job opportunities for and continuous employment of people with disabilities under the slogan, "Support employee independence and achieve social growth in partnership with the local community." Business is primarily focused on activities that provide a comfortable workplace environment for customers, such as landscaping, cleaning, reception duties, selling bread, deliveries, and the management of dormitories. Advantest also actively takes place in various activities in partnership with local communities and relevant organizations to create workplaces where all employees, regardless of their disability status, can work comfortably.

During fiscal 2011, Advantest faced three major issues: ensuring that the ratio of employees with disabilities exceeds 1.8%, the mandatory employment quota in Japan; developing a workplace environment where employees with disabilities can work comfortably; and collaborating with the local community and contributing to society. Advantest made the following plans and focused on the following activities to meet the above challenges.

• Maintaining the employment rate of people with disabilities at the Advantest Group (Japan) at 2.0% or more, and developing a working environment that allows employees with disabilities to work more efficiently by improving manuals and equipment replenishment methods.
• Continuing social contribution activities in response to the needs of the local community, such as workplace internships and company visits.

During fiscal 2011, two new employees with disabilities were hired. Improvements were made to the working environment to ensure that everyone can work efficiently through the improvement and adoption of manuals and the introduction of new equipment replenishment methods. In addition, we actively conducted exchange with the local community as we responded to many requests for our participation in forms that included workplace internships, company visits, and visiting lecturers. The specific activities we participated in are as follows.

Activities for the local community

• Exhibiting a booth at the Disabled Person Work Fair 2011 in Saitama
• Dispatching visiting lecturers (eight times)
• Training was conducted for nine trainees in total from local special needs schools.
• Ten company tours were organized for outside organizations.
• Cleanup activities were conducted around our business sites on seven occasions.
• We took part in an event organized by a local special needs school.

Recognition by outside organizations

• Received the Chairman's Prize as an Excellent Workplace for Persons With Disabilities from the Japan Organization for Employment of the Elderly, Persons with Disabilities and Job Seekers
• Two employees received Exemplary Disabled Worker Awards from the Saitama Employment Development Association

Relationship with the labor union

The current labor unions consist of JEIU, the company union that over 95% of union members belong to; the industrial union JMIU; and the Verigy Ltd. labor union. Advantest sincerely conducts labor negotiations with each of these labor unions.

Giving consideration to human rights in the supply chain

In order to fulfill our social responsibility throughout the supply chain including our suppliers, the Advantest Procurement Policy is disclosed on our website and suppliers are requested to comply with the relevant laws, regulations, and social codes to ensure that consideration is given to human rights throughout the supply chain. In addition, we conduct a questionnaire with our major suppliers (41 companies that account for 85% of transaction volume) once a year so that we can better understand the current situation. For fiscal 2011, a questionnaire was conducted in March 2012, with responses from suppliers indicating that human rights and labor issues were included in company policies and codes of conduct as a form of corporate social responsibility. We plan to conduct a similar questionnaire in fiscal 2012 to confirm the response of suppliers to the Advantest Procurement Policy.

Note that response to the conflict minerals issue was incorporated in the Advantest Procurement Policy as of April 1, 2012 and announced on our website. We will notify out suppliers of the details of this change and request their compliance.

• Procurement Policy