Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• CO2 emissions reduction to 4,489 t-CO2 (10.6% year-on-year increase)
• Mega solar project at Western Japan logistics center
• Adoption of LED lighting and heat-reflecting roof coating in stores
• Reduction in shopping bag and packaging material usage

Social Achievements

• Provided emergency supplies and raised funds for earthquake victims in Kumamoto (approx. ¥2.8 million raised)
• First AUTOBACS AWARDS ceremony recognizing outstanding customer service (5 stores and 17 employees)
• Established Chain Growth Co., Ltd. to specialize in training and retention of automobile mechanics
• Installation of EV charging stands at stores
• Agreements with local governments to provide aid during disasters
• Experiential attractions at KidZania Tokyo and KidZania Koshien
• Support for motorsports (ARTA Project)

Governance Achievements

• Adoption of a managing executive officer system to strengthen implementation capabilities
• Created the position of Head of Corporate Administration to lead cost structure reforms
• Established the Corporate Governance Committee
• Appointed a senior independent director to lead dialogues with shareholders and investors
• Established a Liaison Group for Outside Directors and Audit and Supervisory Board Members

Climate Goals & Targets

Environmental Challenges

• Declining customer traffic at domestic AUTOBACS stores
• Declining sales of automotive goods
• Intensifying competition from car dealerships and internet retailers
• Changes in customer preferences and lifestyles
• Aging of Japanese society and decreasing interest in cars among younger generations
• Economic uncertainty due to decelerating growth in emerging economies, Brexit, and US government change

Mitigation Strategies

• Transition to a retailer offering lifestyle products and services
• Development of new products (e.g., dash cams, sudden acceleration prevention device)
• Enhanced lines of high-profile goods
• Expanded sales efforts for safety products
• Improved inventory efficiency of franchisees
• Streamlining of AUTOBACS retail chain operations
• New store formats (e.g., Smart+1, AUTOBACS GARAGE)
• Strengthening online and telephone reservation services
• Introduction of 15-minute inspections for statutory safety inspections
• Free Anshin 3-Star Repairs service
• Nationwide television commercials
• Establishment of ABT Marketing Co., Ltd. for customer data analysis and marketing campaigns
• Establishment of JACK&MARIE, a car-centric lifestyle brand
• Cost structure reforms

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• Pedal no Mihariban (sudden acceleration prevention device)
• Dash cams
• Other safety products

Awards & Recognition

• Highest DBJ Employees’ Health Management Rating for two consecutive years
• Certified as a White 500 company under the Health and Productivity Management Organization Recognition Program

Environmental Metrics

ESG Focus Areas

• Creation of businesses that solve social issues
• Enhancing efforts that consider the environment and society
• Development of organization and personnel
• Sustainable and strong management base

Environmental Achievements

• Reduced CO2 emissions (Scope 1 & 2): 17,018 t-CO2 in FY2022 to 16,808 t-CO2 in FY2023. Aiming for 0 t-CO2 by FY2050.
• Opened a new store with 56% reduced energy consumption in April 2024.
• Promoting environmentally-enhanced stores (73 stores in FY2023, aiming for 140 by FY2030).
• Reducing oil cans (30,000 cans/year in FY2023, aiming for 220,000 cans/year reduction by FY2030).
• Developing eco-friendly products (124 products in FY2023, aiming for 300 by FY2030).

Social Achievements

• Increased ratio of female employees (18.4% in FY2023, aiming for 30% by FY2030).
• Increased ratio of female managers (7.9% in FY2023, aiming for 18% by FY2030).
• Promoting acquisition of childcare leave by male employees (52% in FY2023, aiming for 100% by FY2030).
• Outsourcing various jobs to Japan Sun Industries, a social welfare organization employing persons with disabilities.
• Held 21 regional traffic safety events in FY2023 (exceeding initial target of 4).

Governance Achievements

• Established the Sustainability Basic Policy, Human Rights Policy, Diversity Policy, and Procurement Policy in April 2023.
• Revised Environmental Policy in July 2023.
• Expressed support for TCFD recommendations in June 2022.
• Established an Orange Hotline, a group whistleblowing system, with 42 cases reported in FY2023 (none serious compliance violations).

Climate Goals & Targets

Environmental Challenges

• Changes in domestic and overseas situations impacting product procurement and Japan's economy.
• Accidents associated with store operations.
• Securing and developing human resources.
• Technological innovations in driving support and automated driving, and the spread of EVs.
• Development and procurement of products.
• Information security risks.
• Climate change impacts on demand for seasonal products and increased environmental regulations.
• Natural disasters.
• Virulent infectious diseases.
• Compliance issues.
• Management of private and confidential information.

Mitigation Strategies

• Risk assessment by the Risk Management Committee and external organizations.
• Training and instructional education on pit work accidents, work manuals, and compliance checks.
• Bulk recruitment, efforts to secure certified mechanics, and a personnel system accommodating diverse work styles.
• Collaboration with auto manufacturers, entry into the EV market, and acquiring Specific Maintenance Certifications.
• Established “AUTOBACS Group Product Quality Guidelines” and product inspections.
• Firewalls, information protection measures, information security regulations, and security education.
• Renewable energy utilization, environmentally-friendly stores, decarbonization efforts, and portfolio review.
• BCP (Business Continuity Plan) and biannual drills.
• Countermeasure equipment and teleworking.
• Promoting awareness and compliance with the Code of Conduct, compliance checks, and a whistleblowing system.
• Regulations and restrictions on document handling and strict measures for managing important electronic data.

Supply Chain Management

Responsible Procurement

• Purchase and provision of environmentally friendly products.
• Auditing and advising overseas factories on production sites to ensure consistent quality.

Climate-Related Risks & Opportunities

Physical Risks

• Increasingly serious natural disasters
• Rise in average temperatures

Transition Risks

• Introduction of carbon pricing
• Stricter CO2 emission regulations
• Enhancement of plastics regulation

Opportunities

• Increases in demand for ZEVs

Reporting Standards

Frameworks Used: GRI, TCFD, SDGs, ISO 26000

Sustainable Products & Innovation

• AQ. private-brand eco-friendly products

Environmental Metrics

ESG Focus Areas

• Environmental Conservation
• HR Development and Work-style Reforms
• Community and Society
• Corporate Governance

Environmental Achievements

• CO2 emissions reduced from 4,106 t-CO2 in FY March 2019 to 3,439 t-CO2 in FY March 2020. Installation of solar power generation panels at West Japan Logistics Center generating approximately 1.4 million kWh in FY March 2020.
• Recycling of used tires, oils, batteries, and other automotive parts; approximately 90% of an entire automobile’s parts are recycled.
• Installation of electric vehicle charging stations at 103 AUTOBACS Group stores.

Social Achievements

• Improved employee well-being initiatives, including work-style reforms (telecommuting, shorter working hours, etc.) resulting in a 64.7% paid leave take-up rate.
• 100% return-to-work rate for female employees after maternity and childcare leave.
• 61.5% uptake rate of male employees taking 5 or more days of childcare leave.
• Ranked No. 1 in customer satisfaction among used car purchasing companies in the 2019 Oricon Customer Satisfaction Survey.

Governance Achievements

• Transitioned from a company with an Audit and Supervisory Board to a company with an Audit and Supervisory Committee.
• Appointment of one-third or more of independent outside directors.
• Establishment of committees (Corporate Governance Committee, Risk Management Committee) as advisory bodies to the Board of Directors.

Climate Goals & Targets

Environmental Challenges

• Declining birthrate, aging population, reduction of working population.
• Intensification of competition in automotive goods retail market.
• Customer retention by manufacturers and dealers.
• Rise in purchase prices and distribution costs.
• Natural disasters, infectious diseases.
• Abnormal weather.
• Impact of the novel coronavirus pandemic.

Mitigation Strategies

• Five-year Rolling Plan to adapt to changes in society, automobiles, and people’s lifestyles.
• Establishment and linking of six networks (automotive goods and services sales, pit service, maintenance, multi-dealer, overseas alliance, online).
• Support measures for franchisees (cost reductions, payment grace periods, short-term loan system).
• Thorough safety measures in stores to maintain business continuity during the pandemic.
• Implementation of various work-style options for employees (telecommuting, flexible hours, etc.).

Supply Chain Management

Responsible Procurement

• Working with manufacturers and suppliers to ensure the legality of products and protect consumers.

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters

Transition Risks

• Decarbonization trend

Opportunities

• Expansion of electric vehicle market

Reporting Standards

Frameworks Used: International Integrated Reporting Framework, GRI Standards

Certifications: Health and Productivity Management Organization (2020)

UN Sustainable Development Goals

• Goal 3
• Goal 4
• Goal 5
• Goal 7
• Goal 8
• Goal 11
• Goal 12
• Goal 13
• Goal 17

The report details how various initiatives contribute to these SDGs, particularly in the areas of safety, health, environmental protection, and community development.

Sustainable Products & Innovation

• Environmentally friendly private brand products with reduced packaging waste.

Awards & Recognition

• Highest rank under the DBJ Employees’ Health Management Rating

Environmental Metrics

ESG Focus Areas

• Environment
• Communities
• Human resources
• Governance

Environmental Achievements

• Installed solar power generation panels at West Japan Logistics Center, generating approximately 1.31 Million kWh in FY March 2021.
• Collected used car air fresheners to recycle as traffic safety reflectors, donating to approximately 7,300 schools.
• Reduced CO2 emissions through rail freight container usage instead of trucks for product transport.
• Minimized waste from private brand product packaging by reducing weight and reviewing materials.

Social Achievements

• Launched ESG & SDGs Project in January 2021.
• Implemented measures to increase the ratio of female employees and held dialogues to listen to their opinions.
• Focused on training of mechanics to cope with advanced car technologies.
• Selected AUTOBACS GUYS as role models for mechanics.
• Implemented the Employee Good Value Awards to reward employee behavioral reforms.
• Maintained a 100% return-to-work rate following maternity or childcare leave.
• Supported over 70% of male employees taking five or more days of childcare leave.

Governance Achievements

• Appointed a Chief Independent Outside Director.
• Established the Corporate Governance Committee, chaired by an Outside Director.
• Held meetings with analysts and investors to receive feedback on ESG approach and SDG efforts.
• Improved the effectiveness of the Board of Directors through continuous evaluation and implementation of initiatives.

Climate Goals & Targets

Environmental Challenges

• Environmental destruction from industrial waste, decreased demand for winter goods due to global warming, accelerated shake-out of the maintenance industry.
• Decline in sales of engine-related parts due to the increase in EVs, decline in personally owned vehicles due to car sharing and subscription services.
• Supply chain disruptions and higher costs due to climate change regulations, super-aging society in Japan, a trend towards young people turning away from driving.
• Shortage of automobile mechanics, human rights violations, cyber risks, risks related to demographic change.

Mitigation Strategies

• Development of new materials and recycled products, recycling of waste materials, increasing need for safe and secure products.
• Cooperation in the maintenance industry, expansion of BtoB business due to increase in car sharing and subscription services.
• Reduction of environmental impact and costs by reviewing logistics, provision of new services for people lacking access to transportation.
• Community support through the provision of vehicles during times of disaster, fostering the next generation of human resources and attracting outstanding human resources.
• Improvement of corporate strength and creation of new ideas through diverse workforce, improvement of employee health and creation of employment opportunities for people with disabilities.

Supply Chain Management

Responsible Procurement

• Product Quality Guidelines, Quality Control Regulations, audits of overseas factories, Acceptable Quality Level (AQL) inspections.

Climate-Related Risks & Opportunities

Physical Risks

• Abnormal weather conditions affecting seasonal merchandise sales.

Transition Risks

• Decline in demand for engine-related parts due to increase in EVs, regulatory changes, market shifts.

Opportunities

• Development of new materials and recycled products, increasing need for safe and secure products, expansion of BtoB business.

Reporting Standards

Frameworks Used: International Integrated Reporting Framework, GRI Standards

Sustainable Products & Innovation

• Environmentally friendly private brand products with simplified packaging and reduced packaging materials.

Awards & Recognition

• DBJ Health Rating (FY March 2020)
• Certified Health and Productivity Management Enterprise (FY March 2021)
• MSCI Japan Empowering Women Index (WIN)