Environment

Since then, due to the government’s “2050 Carbon Neutral Declaration” and subsequent presentation of its target of reducing GHG by 46% (compared to fiscal 2013) by 2030, we performed a revision based on the new standards and set 2050 as our target for taking on the challenge of carbon neutrality, and 2030 for a 46% reduction in CO2 emissions (compared to fiscal 2013).

CDP (headquartered in London) is an international NGO established in 2000 in partnership with institutional investors from around the world. It carries out projects in which it sends out questionnaires to major companies and municipal governments around the world on issues such as climate change, water security, and forests, and that seek climate change strategies and specific declarations related to emissions of greenhouse gases.
With the CDP’s 2020 survey, survey activities were conducted on behalf of 515 institutional investors with net invested assets totaling 106 trillion U.S. dollars. More than 9,600 companies, accounting for over 50% of global market capitalization, disclose environmental data on their initiatives for climate change programs via the CDP.
Responding to a CDP request for responses to its Climate Change and Water Security 2021 questionnaires, our Company received scores of A- and B-, respectively, in December 2020. Having received requests for responses in fiscal 2021 regarding climate change and water security as well, we have responded.
We also expressed our agreement in February 2021 to TCFD. Moving forward, our Group will conduct proactive information disclosure regarding risks and opportunities associated with climate change as we hold ourselves accountable to all of our stakeholders.
We will move forward with environmental information disclosure as we contribute to the response to climate change through environmental impact reduction, resource and energy conservation, chemicals management and development of products that contribute to the environment.

In order to further strengthen and promote future efforts toward carbon neutrality (CN), the Environmental Impact Reduction Committee was reorganized as the Carbon Neutrality Promotion Committee in July 2021. Together with this change, the Energy Conservation Subcommittee, a subordinate organization, was reorganized as the CN Technology Deliberation Subcommittee.
The Environmental Impact Reduction Committee has recapped each year’s progress toward medium- to longterm environmental targets at the end of the fiscal year and then determined the targets for the following fiscal year. It has carried out its activities with the approval of the Sustainability Promotion Committee, which serves as its parent body. Moving forward, as the Carbon Neutrality Promotion Committee, it will take action toward achieving carbon neutrality together with the subordinate Life Cycle Subcommittee and CN Technology Deliberation Subcommittee.

In fiscal 2021, the Life Cycle Subcommittee will work to enhance educational opportunities, horizontally deploy LCA evaluations on baseline products, and expand items on which LCA evaluations have been carried out for SDGcontributing products. Moving forward, they will make preparations to enable the speedy supply of LCA-related information on all products.
The Energy Conservation Subcommittee worked to establish, across all business sites in Japan, a mechanism for continuously soliciting and trying out ideas for saving energy through such means as voluntary implementation initiatives in business sites. In fiscal 2020, the subcommittee successfully reduced energy consumption by as much as 1,535 kL (59,487 GJ) in crude oil equivalent, or 2,962t-CO2, compared with fiscal 2019, primarily by reducing city gas and electricity consumption. Furthermore, the subcommittee established and successfully achieved targets by carrying out unique activities to conserve electricity in the summer and winter months. Outside of Japan, the subcommittee worked to ensure a similar level of activities as in Japan and continued to promote the roll out of activity methods and best practices.
In fiscal 2021, in line with the objectives of the CN Promotion Committee, the CN Technology Review Subcommittee will formulate and work toward the latest 2030 targets, and will continue efforts aimed at achieving energy consumption reduction plans at the workplace level. In particular, the subcommittee will focus on creating a system across business sites in Japan for sharing practices for reducing energy consumption and technical information related to energy conservation in order to improve the level of energysaving technology throughout our Company; and having the mother plants in Japan provide technical support to their affiliated sites through a tie-up with the Company-wide Energy Conservation Secretariat.

The figure below shows inputs, including raw materials and energy, and outputs that are products and emissions released into the environment.

The Group is working to minimize its impact on the environment by means of waste reduction and resource savings through promoting more efficient use of raw materials, energy, and water. We have also been advancing CO2 emissions reduction through our carbon neutral efforts.

Quantities of raw materials inputs and product sales declined further across many categories in fiscal 2020 as economic activity continued to stagnate due to the spread of COVID-19 infections ongoing from the previous year. A recovery trend was observed during the second fiscal half, however, resulting in expectations of an increase in economic activity during fiscal 2021. Through the above-mentioned activities at our Group, we are contributing to the response to aspects of climate change such as warming by working to effect reductions in outputs that effect the environment, with respect to increases in input.

In fiscal 2018, we established a medium- to long-term environmental plan ending in fiscal 2030, and are engaging in activities based on it, in which our CO2 emissions met the greenhouse gas emission reduction target in the Japanese government's INDC from COP21.
However, due to the government’s 2050 Carbon Neutral Declaration and presentation of its 2030 target, we performed a new revision according to the 2030 target, and reset our 2030 target policy to include a 46% reduction in CO2 emissions (compared to fiscal 2013). We are currently deliberating the formulation of a new medium- to long-term plan that takes this policy into consideration. (The graph below and the data detailed on page 104 show the existing medium- to long-term plan.)
In addition to the government policy noted above, deliberation of targets will include consideration of:

In addition, we continue to undertake efforts with the Japan Business Federation (Keidanren), and through the Japan Chemical Industry Association.
We will also revise other targets upon reconsidering their appropriateness, and by restricting the volume of material loss that occurs, we will improve the efficiency of resource use, advance the effective use of raw materials, and promote the reduction of chemical substance emissions as we pursue planned efforts to reduce environmental impact.

Since fiscal 2015, we have been continuously surveying the regional watershed risk of all major plants in the Group (11 sites in Japan and 24 sites overseas). In fiscal 2020, our Group revised risk levels based on the results of a study using the WRI Aqueduct tool in addition to independent studies performed on each business site. We compiled the results into a table that contains the risks facing each of the regions in which the Group operates. Although there were no major changes in the assessment for this fiscal year, our ranking worsened after last year’s update due to the increasing prominence of water resource risk in the China region accompanying economic growth there. In light of these results, we will undertake more highly effective water resource conservation moving forward.

When it comes to the problem of marine plastics, we are moving ahead with activities to contribute to reducing plastic marine waste via a number of initiatives based on the Japanese government’s Plastic Resource Recycling Strategy. These initiatives include managing the raw materials used and the plastic products we manufacture, promoting the recycling of said products, and developing new products.

We are currently taking part in the Japan Initiative for Marine Environment (JaIME), which was established by major companies and industry organizations in the chemical industry, as well as the Clean Ocean Material Alliance (CLOMA), which was established by a broad range of business operators related to supply chains for plastic products, including those in the chemical industry and distribution/retail industries, with the goal of forming cross-industry partnerships. Through this, we are working to address a variety of challenges by aiming to curb plastic waste across our supply chain as a whole and promoting recycling via 3R activities for plastic products.

Our Group promotes recycling as a means to make effective use of resources. This recycling includes the recovery and recycling of phenol from waste liquid produced by phenolic resin reactions during the product production process, fine grinding of offcuts from phenolic laminated sheets and decorative melamine resin laminate for use as a filler in phenolic resin molding compounds reuse of molded article by-products (sprues and runners) as raw material for molding materials, as well as reuse of excess sludge from activated sludge effluent treatment equipment as compost (organic fertilizer).

Our Company has been using inedible plant-derived raw materials (Cashew nut shell oil, rosin [pine resin], wood flour, etc.) as renewable raw materials, primarily of phenolic resins and molding compounds. They account for about 2.7% of all raw materials used. In order to further increase the rate at which we use renewable raw materials in the future, we will undertake the development of phenolic resins using plant-derived lignin, as well as the use of bioplastics.