Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Reduced total energy consumption from 12,264 KL in FY2019 to 11,454 KL in FY2021
• Increased recycled waste from 378.8 tons in FY2019 to 514.6 tons in FY2021
• Reduced Scope 1 and 2 greenhouse gas emissions from 21,558 t-CO2 in FY2019 to 17,308 t-CO2 in FY2021

Social Achievements

• Increased proportion of female employees from 44.4% in FY2019 to 45.2% in FY2021
• Increased number of financial education participants from 2,729 in FY2019 to 24,503 in FY2021
• Improved average rate of utilization of paid leave from 65.2% in FY2019 to 80% in FY2021

Governance Achievements

• Maintained a consistent number of outside/independent directors (3) across the reporting period
• Improved average attendance rate for Board of Directors meetings from 99.4% in FY2021 to 100% in FY2020

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Climate Change
• Governance

Environmental Achievements

• Achieved an A rating in MSCI's ESG ratings (top among Japan's regional banks)
• Improved CDP Climate Change Score (top third in the country)
• Conducted scenario analysis based on TCFD recommendations
• Joined PCAF and calculated GHG emissions for approximately 90% of domestic corporate lending clients (4 million tons of GHG emissions, data quality score of 3.8)

Social Achievements

• Increased time invested in human resource development by 1.6 times (BOY KPI)
• Increased ratio of female managers from 17% to 22% (BOY KPI)
• Implemented employee surveys and interviews to inform mid-term business plan
• Top management visits sales branches to engage with employees

Governance Achievements

• Established Group Sustainability Committee Secretariat
• Incorporated ESG factors into executive compensation system
• Three of seven Board members are independent outside directors
• Skills matrix disclosed for Board of Directors
• Compensation and Nomination Committee consists solely of outside directors
• Active engagement of outside directors in succession planning (interviewed ~40 candidates)
• Received an award for excellence at the Nikkei Integrated Report Awards

Climate Goals & Targets

Environmental Challenges

• Prioritizing sectors with high GHG emissions for Scope 3 reduction
• Intensifying efforts in already engaged sectors for Scope 3 reduction
• Improving data quality for Scope 3 emissions calculations (low weight of disclosed data)
• Losses on revaluation of marketable securities

Mitigation Strategies

• Selected electricity, coal, oil, and gas as priority sectors for GHG emission reduction
• Selected automotive and parts sector as a priority sector for engagement, focusing on upstream customers
• Supporting visualization and reduction of GHG emissions through engagement with individual companies
• Gradually reducing valuation losses by selling securities and increasing foreign currency deposits

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Flood damage

Transition Risks

• Vulnerability of certain sectors to climate change

Opportunities

• Expanding solutions menu to support decarbonization efforts

Reporting Standards

Frameworks Used: TCFD, PCAF

Sustainable Products & Innovation

• SDGs friends loans
• Sustainability-linked loans
• Green loans
• Positive impact finance

Awards & Recognition

• A rating in MSCI's ESG ratings
• Improved CDP Climate Change Score
• Nikkei Integrated Report Awards

Environmental Metrics

ESG Focus Areas

• Diversity, Equity, & Inclusion
• Climate Change
• Sustainability
• Human Capital Investment
• Corporate Governance

Environmental Achievements

• Set carbon neutrality (Scopes 1 and 2) by FY2030 as a goal and are tackling this through efforts that include energy conservation and switching to real renewable energy for the electricity we ourselves contract for.

Social Achievements

• Percentage of female managers: 18.1% (Target by end of FY2024 : 20%)
• Percentage of female assistant managers or higher: 37.6% (Target by end of FY2024: 38%)
• Percentage of mid-career hires in management positions: 14.2% (Target by end of FY2024: 14% or higher)
• Group was the first regional bank to be recognized as a “Best Workplace” in the “D&I Award 2023”
• Selected as “Next Nadeshiko: Companies Supporting Dual-career and Co-parenting” in FY2023

Governance Achievements

• Implemented all the principles of Japan's Corporate Governance Code, as revised in June 2021.
• Established a Compensation and Personnel Committee consisting solely of outside directors as a voluntary mechanism.
• Appoints outside directors who have a standpoint independent from the Group to make up at least one third of all directors.

Climate Goals & Targets

Environmental Challenges

• Achieving ROE above the shareholders' equity cost is essential for improving our corporate value. Current ROE is below the shareholders' equity cost.
• Transition risks (risks associated with the transition to a decarbonized society) and physical risks (risks associated with severe natural disasters and extreme weather events)

Mitigation Strategies

• The Group intends to steadily increase ROE by allocating management capital, including economic and human capital, to the solutions business and by working for sustainable profit growth with solutions earnings as the driver.
• Examining the impact on its business of the transition to a decarbonized society associated with climate change and is developing and implementing strategies in order to address climate change in order to address these risks and opportunities.
• Conducting scenario analyses to quantify the financial impact on sectors assumed to be vulnerable to climate change, and have calculated GHG emissions in its investment and loan portfolios

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• severe natural disasters and extreme weather events

Transition Risks

• risks associated with the transition to a decarbonized society

Reporting Standards

Frameworks Used: TCFD

Awards & Recognition

• “Best Workplace” in the “D&I Award 2023”, “Next Nadeshiko: Companies Supporting Dual-career and Co-parenting” in FY2023