We have established the following Basic Policy on Our Human Resources Management System as the cornerstone of a system that contributes to the sustainable development of the company in our effort to be a globally active integrated energy company that represents Japan.

By operating systems based on this policy, our goal is to harness employee capabilities to produce high-quality results as a team and become an organization capable of competing in the global arena at a high level.

Basic Policy on Human Resources Management System

1. A system that encourages all employees to play their part and work as a team to achieve higher organizational goals, contributing to the growth of the company.
2. A system that encourages all employees to gain a broader perspective on work duties so as to identify issues, come up with solutions on their own initiatives, and act responsibly.
3. A system that assists all employees in their determined efforts to continue to pursue self-development over long periods of their career.
4. A system that is transparent and straightforward in recognizing the individual contribution of employees to achieving corporate objectives and in making them feel that they are rewarded fairly.

We have established an employee evaluation system to fairly evaluate and reward our employees for their achievements and demonstrations of capabilities, and we strive to operate it in an equitable manner.

These evaluations are not merely one-way assessments of employees by their managers; they also include tools such as an Action Reflection Sheet and a Goals Challenge Sheet that our employees can use to complete a self-evaluation while reflecting on their performance.

Employees are given opportunities to discuss their achievements at work with their managers in face-to-face meetings. This is to assess the gap between the self-evaluation and the superior’s evaluation. The system is designed so that improvements can be made to each type of evaluation, thereby contributing to human resource development and boosting the credibility of the evaluation.

We also employ a self-report system under which our employees can submit requests for new assignments and transfers once a year. Although we cannot accommodate all requests, this gives the company a better understanding of the extent to which employees think they are fit for their current assignments and what career paths they wish to pursue, both of which are helpful for the company in developing plans for recruiting and allocating human resources.

To make these systems an established part of the entire INPEX Group, we regularly provide line managers (i.e., personnel in charge of human resources and discrete organizational units) with practical training for conducting evaluations.

We provide our employees with training programs to help them develop a global perspective, become leaders that contribute to our corporate value, and improve employee skills across the board. We also have a self-learning system to support employee learning in a variety of fields. And in fiscal 2010, we introduced a study abroad program to help employees acquire knowledge and technical skills in a specialized field.

For new employees, we provide orientation training as well as a mentor system in which senior employees provide one-on-one guidance on company procedures and mental support for one year.

The INPEX Group implements various measures to respect human rights and eliminate discrimination, employ diverse human resources, develop and utilize human resources, and encourage communication in the workplace.

We hire and train the personnel we need regardless of nationality. Highly specialized global staff members work both at our overseas offices and our Tokyo headquarters. Additionally, because our large-scale overseas projects are now approaching their full-scale development and production phases, with expectations for long-term operations, we locally recruit employees who will play an integral part in running our overseas offices. We will continue to actively practice diversity management by devising measures to maintain competitive hiring criteria, maintain a strong work ethic among local employees, and improve our employee retention rates, and by promoting the diversity of our human resources.

The INPEX Group has been proactive in hiring the physically challenged via job placement offices and other venues, while giving consideration to varying working conditions and responsibilities.

As of March 31, 2011, we employed 29 physically challenged employees, 1.9% of the total workforce. We will continue to make efforts in the future to employ as many physically challenged people as feasible.

The INPEX Group has a rehiring contract system whereby it rehires employees who reach the full retirement age of 60 to help them continue working while making use of their extensive experience and advanced abilities and skills. This system hires retirees for positions that match the interests of both the company and the retiree, with the option to renew the contract every year until the age of 65. We have hired over 90% of all applicants to this program. As of the end of fiscal 2010 (March 31, 2011), 58 of our employees are working under a retire-rehire contract.

INPEX Australia has currently over 400 staff members in Australia and other international offices associated with the Ichthys Project. These staff members from Australia, the UK, France, Japan and other countries are recruited in accordance with Australian employment legislation providing equal opportunity in the workplace and ensuring compliance with National Employment Standards. We have been implementing the “INPEX@heart” program for the last few years to develop the desired workplace culture based on our CSR values through initiatives that range from social activities to teambuilding events and training workshops. In March 2011 we celebrated “Harmony Week” with in-house events to embrace diversity in the workplace and overcome barriers based on race and nationality, to build a positive workplace on a foundation of “team spirit.”

Informational meeting on the new code
of conduct

To carry out oil and natural gas development activities in the Abadi Gas Field development project and other operations, 176 employees from seven different countries, including 103 Indonesians and 52 Japanese, work at the Jakarta Office.

As its organization grows along with progress in project development, we can expect the Jakarta Office to take on a larger and more global workforce.

With that in mind, in March 2011 we established a code of conduct for employees working at the Jakarta Office to respect and maintain a safe and balanced work environment founded on integrity, trust, and fairness.

To communicate the code of conduct to all employees, local top managers delivered a message and are currently making efforts to encourage everyone to put it into practice.

Seeking to maintain work environments that cater to different lifestyles and enable employees to fully express their abilities, the INPEX Group introduces support systems and versatile work styles to promote work-life balance. We also fully recognize our social responsibility within the context of a declining birthrate and aging population in Japan, as well as support our employees to meet their various needs.

• Moderating Work Hours

At the INPEX Group as a whole, total work hours have been gradually declining. In April 2011, we launched a campaign that encourages employees to leave work before 6 p.m. at least four times a month, with flexibility allowed for each person’s work schedule. Maintaining a regular work schedule helps employees to rejuvenate themselves both mentally and physically, use their limited work time more effectively, and be more productive at work.

And when employees need to extend their overtime hours beyond the predetermined limit, we encourage managers and their junior staff to not only review the latter’s workload but also discuss current conditions and challenges they are facing.

• Family Care Support

We offer our employees a greater variety of support programs to assist them in caring for their families, which goes beyond the legal requirements.

We also have devised a general action plan as required by Japan’s Law for Measures to Support the Development of the Next Generation to implement programs to encourage male employees to be more involved in raising their children and help them maintain a balance between their work and child-rearing.

Our parental leave system includes various programs to support employees in caring for their children, including special leave for male employees allowing them to take up to three days paid leave during childbirth, and a reduced working hours system that can be used until the child reaches the fourth grade. As a result of increased awareness of these programs, in fiscal 2010, 11 employees (including one male employee) took parental leave, 13 used the reduced hours system, and a combined total of 226 took advantage of partial subsidies for nursery school and other childcare expenses.

Under our nursing care support system, employees can take up to 365 days of leave to care for one sick or elderly family member or, instead of taking leave, use a reduced hours system to take care of family while working. Two employees used the nursing care support system in fiscal 2010.

We strive to maintain and promote sound relationships between our management and employees based on a foundation of mutual trust and cooperation. To that end, our management meets regularly with employee representatives to exchange views and ideas on a broad range of issues that include challenges that we are facing and our business outlook. As of March 31, 2010, the INPEX Labor Union has 1,030 members.

Labor-Management Meetings Held in FY2010
Central labor-management meetings: July and December
Branch labor-management meetings: Niigata region—July; Akita region—July; Chiba region—July

The INPEX Group considers health maintenance and promoting better health among our global employees to be critical to the execution of our business activities. We adopt various approaches to ensure that our employees are physically and mentally healthy.

Each of our Operational Organizations has an occupational physician, and organizations above a certain size have a resident occupational health nurse. These staff work to maintain and improve the health of our employees by offering advice in response to health check results, providing counseling on overwork-related issues, participating in health and safety committees, centrally managing and analyzing the health check results through a database, and periodically distributing health-related information.

Employees who experience health problems that hinder their work performance can take a leave period of up to 3.5 years, providing them the time necessary to recover before returning to work.

In addition to the periodic medical checkups required by law we provide employees with assistance to monitor their health. Employees aged 30 and over are provided with lifestyle disease checkups, and employees aged 35 and over are provided with complete medical checkups. We also allow employees to choose their checkup date, medical institution, and optional tests according to their own circumstances.

Moreover, we provide employees with assistance for receiving flu vaccinations, and try to prevent transmission by giving all employees the opportunity to get vaccinated at work.

For employees transferring overseas, we provide health checks and vaccinations through an affiliated medical institution specialized in travel medicine, and have introduced an internet-based service for health consultation, counseling, and introductory information to medical institutions. In the event of an emergency, a contracted emergency medical service company will arrange for our overseas employees to receive medical treatment, be transported, and brought back home.

As another program to promote employee wellness, we provide benefits for all employees and some of their family members, including sports clubs or gyms. In fiscal 2010, there were over 4,000 users (cumulative) of this program.

We have adopted a self-service stress test tool that employees can use to gauge their stress levels. Once every year, we have a mental health awareness month during which we encourage testing to check our employee stress levels, and we analyze the stress levels for each organization. Our health staff provides extra care to employees under high levels of stress as part of our effort to detect stress and take appropriate measures at an early stage.

In an effort to provide better consultation services, we introduced an employee assistance program (EAP) through which employees and their family members can take advantage of expert counseling services. The program has also provided mental health counseling for employees who returned from an area of conflict.

In fiscal 2010 we began activities to support employees in their return to work after a mental health leave. Given the particular importance of close communication between the employee’s supervisor and primary physician, health staff, and human resources staff during and after rehabilitation, we created a manual that prescribes what each party should do at each stage in the process.