Climate Change Data

Environmental Metrics

ESG Focus Areas

• Health
• Environment
• Quality
• Culture
• Employees

Environmental Achievements

• Reduced SOx emissions
• Reduced NOx emissions
• Reduced dust and soot emissions
• Increased recycling rate (79.6% for 20 Group companies outside Japan)
• 22 out of 32 factories in Japan achieved zero emissions
• Developed eco-friendly products (lighter bottles, reduced packaging)
• Implemented cogeneration systems to reduce CO2 emissions
• Created biotopes to conserve biodiversity

Social Achievements

• Opened on-site day care centers (BeanStalk Kids Centers) to support employees with childcare
• Increased number of male employees taking parenting leave
• Established the Otsuka Welfare Clinic in Peshawar, Pakistan, providing free medical care to Afghan refugees
• Supported community initiatives (cleanup activities, educational programs)
• Promoted diversity in the workforce (increased percentage of female corporate officers)
• Established Heartful Kawauchi Co., Ltd. to employ people with disabilities

Governance Achievements

• Implemented the Otsuka Group Global Code of Business Ethics
• Strengthened global-level quality controls
• Appointed outside directors to enhance corporate governance
• Established Internal Report Consultation Office to strengthen compliance management

Climate Goals & Targets

Environmental Challenges

• Increased CO2 emissions due to business expansion and changes in electricity CO2 emission coefficient
• Increased waste discharge due to equipment replacement
• Need to reduce water consumption
• Need to further improve energy efficiency

Mitigation Strategies

• Implemented energy conservation measures (cogeneration systems, fuel conversion, eco-commuting)
• Improved delivery efficiency through transportation modal shift and joint delivery
• Promoted 3R initiatives (reduce, reuse, recycle)
• Developed eco-friendly products and packaging
• Expanded ISO 14001 certification

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Careful investigation and inspection of business partners
• Use of RSPO-certified palm oil

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Guidelines 3rd Edition, ISO 26000, Environmental Report Guidelines 2012 Edition (Japan’s Ministry of the Environment)

Certifications: ISO 9001, ISO 13485, ISO 22000, ISO 22301 (Otsuka Pharmaceutical)

Third-party Assurance: Not disclosed

Sustainable Products & Innovation

• Eco-friendly products (lighter bottles, reduced packaging)
• ELNEOPA injection solutions with quad-chamber kit formulation bags

Awards & Recognition

• Diversity Management Selection 100 (Otsuka Pharmaceutical)
• Bizen General Service Bureau Director’s Award for Regional Environmental Protection (Taiho Pharmaceutical)
• Fiscal 2014 Okayama Prefecture Eco Tour Learning Facility (Taiho Pharmaceutical)
• 8th Responsible Care Awards (Otsuka Chemical)

Environmental Metrics

ESG Focus Areas

• Health
• Environment
• Quality
• Culture
• Employees

Environmental Achievements

• Reduced CO2 emissions through energy conservation and manufacturing process innovation.
• Achieved 97.5% recycling rate and 546 tons final disposal amount for 13 Japanese Group companies.
• 82.8% recycling rate for 20 Group companies outside Japan.
• Reduced weight of plastic bottles and packaging film.
• Introduced eco-caps, reducing raw material use by about 60%.
• Established biotopes at Tokushima Itano Factory and Okayama Plant to conserve biodiversity.

Social Achievements

• Launched EQUELLE, a functional food containing equol, to improve women's health.
• Established on-site day care centers to support employees with young children.
• Provided medical treatment to over 700,000 Afghan refugees at the Otsuka Welfare Clinic in Peshawar, Pakistan.
• Donated over 110,000 books to support children's education in Indonesia.
• Engaged in various community initiatives, including cleanup activities and health promotion programs.

Governance Achievements

• Appointed outside directors to enhance corporate governance transparency.
• Implemented compliance training for all employees.
• Established Internal Report Consultation Office to strengthen compliance management.
• Acquired ISO 22301 certification for business continuity management.

Climate Goals & Targets

Environmental Challenges

• Increased CO2 emissions outside Japan due to business expansion and changes in electricity CO2 emission coefficient.
• Need to further reduce waste and improve recycling rates outside Japan.
• Balancing work-life responsibilities for employees.

Mitigation Strategies

• Improving delivery efficiency using transportation modal shift measures and joint delivery.
• Implementing 3Rs (reduce, reuse, recycle) initiatives.
• Establishing on-site day care centers and offering caregiver support programs.
• Promoting fuel conversion to natural gas and other clean energy sources.

Supply Chain Management

Responsible Procurement

• Investigations and verifications to ensure quality of raw materials
• Basic transaction agreements with business partners

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Guidelines 3rd Edition, ISO 26000, Environmental Report Guidelines 2012 Edition (Japan’s Ministry of the Environment)

Certifications: ISO 14001, ISO 9001, ISO 13485, ISO 22000, ISO 22301

Sustainable Products & Innovation

• Eco-friendly products that reduce environmental impact
• Lighter bottles and packaging
• Eco-caps

Awards & Recognition

• Japanese Foreign Minister’s Commendation (2014)
• 8th Responsible Care Awards (Otsuka Chemical, 2014)

Environmental Metrics

ESG Focus Areas

• Health
• Environment
• Quality
• Culture
• Employees

Environmental Achievements

• Reduced CO2 emissions through fuel conversion and energy efficiency improvements.
• Achieved a 98.2% recycling rate with 580 tons of final disposal amount in Japan.
• Several factories achieved zero emissions status.

Social Achievements

• Launched the Otsuka Welfare Clinic in Peshawar, Pakistan, providing medical treatment to over 800,000 Afghan refugees.
• Established on-site childcare centers to support employees with young children.
• Implemented programs to support women in the workplace and their return after childcare leave.

Governance Achievements

• Established the Otsuka Group Global Code of Business Ethics and Global Anti-Corruption Policy.
• Established a whistleblowing system with independent external points of contact.
• Formulated Corporate Governance Guidelines based on Japan’s Corporate Governance Code.

Climate Goals & Targets

Environmental Challenges

• Balancing work and home care responsibilities for employees.
• Managing waste from manufacturing processes.
• Reducing CO2 emissions from energy-intensive processes and logistics.

Mitigation Strategies

• Implemented caregiver leave, shorter working hours, and flextime programs.
• Promoted 3Rs (reduce, reuse, recycle) initiatives and material/thermal recycling.
• Implemented energy-saving measures, fuel conversion, and modal shift in logistics.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Investigations and verifications to ensure quality of raw materials and stable procurement; basic transaction agreements to prevent risk; consideration of human rights, labor, and environmental circumstances.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Guidelines 3rd Edition, ISO 26000, Environmental Reporting Guidelines 2012 Edition (Japan’s Ministry of the Environment)

Certifications: ISO 9001, ISO 13485, ISO 22000, ISO 14001, ISO 50001, ISO 22301, PrivacyMark, ISMS

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Lighter containers for POCARI SWEAT and MATCH; eco-caps for Crystal Geyser; lighter packaging for SOYJOY and Calorie Mate; world’s first IV solution quad bag.

Awards & Recognition

• Japanese Foreign Minister’s Commendation (Otsuka Pharmaceutical)
• Minister of the Environment Award Good Life Special Prize
• Diversity Management Selection 100 (Otsuka Pharmaceutical)

Environmental Metrics

ESG Focus Areas

• Health
• Environment
• Quality
• Culture
• Employees

Environmental Achievements

• Reduced CO2 emissions by 7.3% in Japan in FY2016 compared to FY2010.
• Achieved a 98.5% waste recycling rate in Japan in FY2016.
• Reduced CO2 emissions by 670 tons in 2016 through recovered heat conversion.

Social Achievements

• Launched EQUELLE in 2014 to support women's health during and after midlife transition.
• Provided free medical treatment to over 800,000 people at the Otsuka Welfare Clinic in Pakistan.
• Donated a sub-rural health center in Myanmar to improve maternal and child healthcare.

Governance Achievements

• Established the Otsuka Group Global Code of Business Ethics.
• Implemented group-wide training on the Global Anti-Corruption Policy.
• Established a Corporate Governance Committee in February 2017.

Climate Goals & Targets

Environmental Challenges

• Increasing healthcare costs and the need for disease prevention.
• Compliance challenges in diverse Asian and Arab countries.
• Managing risks associated with large-scale earthquakes and disasters.

Mitigation Strategies

• Focus on pharmaceuticals and nutraceuticals to address disease prevention.
• Provided support and training to subsidiaries to ensure compliance.
• Implemented business continuity plans (BCP) and business continuity management (BCM) systems, achieving ISO 22301 certification.

Supply Chain Management

Supplier Audits: CSR procurement questionnaire distributed to evaluate CSR activities.

Responsible Procurement

• CSR procurement policy; ensuring understanding of human rights, labor, environmental circumstances, and corruption prevention.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Guidelines 4th Edition, ISO 26000, Environmental Reporting Guidelines 2012 Edition (Japan’s Ministry of the Environment)

Certifications: ISO 14001, ISO 50001, ISO 22301, PrivacyMark, Information Security Management System (ISMS)

Sustainable Products & Innovation

• Lighter packaging, eco-friendly products

Awards & Recognition

• Japanese Foreign Minister’s Commendation (2014)
• Heat Illness Prevention Communication Project Hitosuzumi Award (2016)
• Top Runner Award (Private Sector, 2016)
• Kansai Eco Office Award (2016)
• Japan Packaging Competition award (2016)
• Tokushima Environmental Prefectural Assembly Award
• Responsible Care Excellence Award (2014)
• Tokushima Labor Bureau Director Encouragement Award for Safety Assurance Measures (2015)
• Certified Health and Productivity Management Organization (2017)

Environmental Metrics

ESG Focus Areas

• Health
• Environment
• Governance

Environmental Achievements

• Achieved a 99.5% resource recycling rate and zero emissions in Japan (based on internal standard of 99% or higher recycling rate).

Social Achievements

• Expanded access to DELTYBA, a tuberculosis drug, in over 80 countries.
• Increased employee ratio outside Japan from 52% in 2014 to approximately 58% in 2018.
• Launched various health awareness-raising and educational activities throughout Japan.

Governance Achievements

• Established Otsuka Group Global Code of Business Ethics and Global Anti-Corruption Policy.
• Established Corporate Governance Committee in February 2017.
• Appointed two female directors in 2018.

Climate Goals & Targets

Environmental Challenges

• Challenging business environment in Japan due to drug pricing system reforms and promotion of generic drugs.
• Unprecedented challenges in developing and commercializing new drugs in areas with no therapeutic precedent or market.
• Increased CO2 emissions in fiscal 2018 due to increased production.

Mitigation Strategies

• Diversification of revenue structure to achieve sustainable growth.
• Active investment in R&D to maximize the value of new product lineup.
• Efforts to reduce CO2 emissions throughout the value chain, including the use of cogeneration systems and renewable energy.

Supply Chain Management

Supplier Audits: More than 95% of partners responded to CSR procurement self-assessment questionnaire in 2018.

Responsible Procurement

• CSR procurement considering human rights, labor issues, environment, and anti-corruption measures.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: International Integrated Reporting Framework (IIRC), GRI Standards, ISO26000, Environmental Reporting Guidelines (2018 edition), MOE, Guidance for Collaborative Value Creation, METI

UN Sustainable Development Goals

• SDG 3: Good Health and Well-being
• SDG 9: Industry, Innovation and Infrastructure
• SDG 13: Climate Action

Otsuka's activities contribute to these goals through drug development, sustainable business practices, and environmental initiatives.

Sustainable Products & Innovation

• DELTYBA
• Samsca/JINARC/JYNARQUE
• REXULTI
• ABILIFY MAINTENA

Awards & Recognition

• Corporate Innovator Award from the US National Kidney Foundation (May 2019)

Environmental Metrics

ESG Focus Areas

• Carbon Neutrality
• Circular Economy
• Water Neutrality
• Biodiversity

Environmental Achievements

• Reduced CO2 emissions by 16.5% compared to 2017 (Scope 1 and 2)
• Introduced CO2-free electricity at 23 manufacturing sites, reducing annual emissions by approximately 109,800 t-CO2
• Reduced water usage in Japan by 696,000 m3 (6% year-on-year reduction)
• Launched PET bottles made using 50% recycled PET resin for Crystal Geyser and 30% recycled PET for Pocari Sweat

Social Achievements

• Not disclosed

Governance Achievements

• Established the Otsuka Group Sustainability Promotion Committee
• Announced support for TCFD recommendations
• Joined the RE100 initiative

Climate Goals & Targets

Environmental Challenges

• Climate change impacting biological and water resources
• Transition risks including energy shortages and price increases
• Physical risks such as damage to facilities from extreme weather
• Water resource risks in different regions

Mitigation Strategies

• Promoting the introduction of CO2-free electricity, mega solar power systems, fuel conversion, etc.
• Establishing an integrated energy service structure in Japan
• Decentralized production of major products
• Strengthening communication with supply chains
• Developing a water use strategy for business locations in water-stressed areas
• Expanding the plant water management program globally

Supply Chain Management

Supplier Audits: 57 companies implemented SAQ in 2021

Responsible Procurement

• Otsuka Group Procurement Policy
• Otsuka Group Sustainable Procurement Guidelines

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Supply chain disruptions

Transition Risks

• Increased energy costs
• Tightened regulations

Opportunities

• Reduced operating costs through energy efficiency
• Increased revenue from products addressing climate change

Reporting Standards

Frameworks Used: International Integrated Reporting Framework (IIRC), GRI Sustainability Reporting Standards, ISO 26000, Environmental Reporting Guidelines 2018 (Ministry of the Environment, Japan)

Certifications: ISO 14001

Third-party Assurance: Third-party verification for GHG emissions Scopes 1 and 2, and Scope 3 (Category 1)

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• PET bottles made with recycled materials

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Sustainability

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Global environment
• Women's health
• Aging societies with declining birthrates

Environmental Achievements

• Reduced CO2 emissions (Scope 1, 2) by 36.1% compared to 2017
• Reduced simple incineration and landfill disposal by 17.3% compared to 2019
• Introduced 242,000 t-CO2 of renewable energy

Social Achievements

• Launched TB elimination project in Indonesia, receiving the Exemplar Award from the EWTB Initiative
• Increased percentage of female managers to 21.8%
• 21 companies certified as 2023 Health and Productivity Management Outstanding Organizations

Governance Achievements

• Increased proportion of independent outside directors to more than one-third
• Established a Nominating and Compensation Committee
• Revised Otsuka Group Procurement Policy and Otsuka Group Sustainable Procurement Guidelines

Climate Goals & Targets

Environmental Challenges

• Impact of drug price revisions, healthcare systems, and government policies
• Delay or cancellation of R&D
• Supply chain disruptions due to pandemics and major natural disasters
• Securing and developing human resources
• Climate change
• Loss of exclusivity (LOE) for major products

Mitigation Strategies

• Developing innovative new drugs at fair prices
• Proving the value of new drugs
• Strengthening research and development capabilities
• Building a strong supply chain in collaboration with business partners
• Developing business continuity plans (BCP)
• Developing next-generation growth drivers to mitigate LOE impact

Supply Chain Management

Supplier Audits: 597 suppliers in Japan and 56 overseas assessed using GCNJ’s SAQs and Otsuka Group’s own SAQs (2023)

Responsible Procurement

• Otsuka Group Procurement Policy
• Otsuka Group Sustainable Procurement Guidelines
• Otsuka Group Business Partner Code of Ethics

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters

Transition Risks

• Climate change taxes
• Decarbonized society

Opportunities

• Development of energy-efficient products
• Expansion of renewable energy market

Reporting Standards

Frameworks Used: International Integrated Reporting Framework, GRI Sustainability Reporting Standards

Certifications: ISO 14001 (integrated certification)

UN Sustainable Development Goals

• Goal 3: Good Health and Well-being
• Goal 6: Clean Water and Sanitation
• Goal 7: Affordable and Clean Energy
• Goal 9: Industry, Innovation and Infrastructure
• Goal 12: Responsible Consumption and Production
• Goal 13: Climate Action

Initiatives contribute to these goals through various programs and targets

Sustainable Products & Innovation

• PET bottles made using recycled materials

Awards & Recognition

• CDP Climate Change A-List (2023)
• Exemplar Award from the EWTB initiative (2024)
• Silver prize in the IR site ranking 2023 (Gomez)
• Excellent company in the ESG site ranking 2023 (Gomez)

Environmental Metrics

ESG Focus Areas

• Earth Environment
• Women's Health
• Aging Society

Environmental Achievements

• Reduced CO2 emissions by 36.1% (2017-2023)
• Reduced waste incineration and landfill by 17.3% (2019-2023)
• Achieved CDP Climate Change A List for two consecutive years
• Introduced CO2-free electricity at Otsuka Techno's two domestic factories, reducing CO2 emissions by approximately 8,000 tons annually
• Installed solar panels at four Otsuka Pharmaceutical factories, reducing CO2 emissions by approximately 970 tons annually

Social Achievements

• Launched employee well-being programs, including mental health support and various health seminars
• Increased the number of women in management positions
• Improved the rate of childcare leave acquisition
• Established a consultation window for women's health with a gynecologist at Otsuka Pharmaceutical's health insurance association
• Implemented initiatives to support employees balancing work and treatment
• Launched the “Women’s Health Promotion Project” website to provide information on women's health
• Acquired Bona Fide Health, expanding the women's health product line in the US

Governance Achievements

• Strengthened corporate governance by establishing a Corporate Governance Committee and a Nomination and Compensation Committee
• Implemented a robust compliance system with global training programs and internal reporting mechanisms
• Established a risk management system based on the Enterprise Risk Management (ERM) framework
• Introduced a clawback clause in the executive compensation system

Climate Goals & Targets

Environmental Challenges

• Changes in laws and regulations in the healthcare industry
• Unexpected side effects or malfunctions of pharmaceuticals and medical devices
• Changes in health values and consumer needs
• Shortage of highly skilled professionals
• Climate change and large-scale natural disasters
• Supply chain disruptions
• Digital transformation (DX) challenges
• Information security risks

Mitigation Strategies

• Developed alternative sourcing strategies
• Strengthened safety management and global organizational structure
• Developed sustainable products and marketing strategies
• Implemented a planned renewable energy introduction for decarbonization
• Developed business continuity plans (BCP)
• Strengthened cybersecurity infrastructure and processes
• Established a CSIRT (Computer Security Incident Response Team)

Supply Chain Management

Supplier Audits: 597 (domestic 577, overseas 20) in 2023

Responsible Procurement

• Otsuka Group Procurement Policy
• Otsuka Group Sustainable Procurement Guidelines
• Supplier assessments using GCNJ common SAQ and Otsuka's own SAQs

Climate-Related Risks & Opportunities

Physical Risks

• Increase in natural disasters due to rising temperatures
• Impact on agricultural products
• Loss of biodiversity

Transition Risks

• Introduction of carbon taxes
• Changes in product/service needs due to the shift to a decarbonized society

Opportunities

• Development of energy-efficient products
• Expansion of renewable energy markets

Reporting Standards

Frameworks Used: GRI, TCFD, UNGC, TNFD

Certifications: ISO 14001

UN Sustainable Development Goals

• Goal 3: Good Health and Well-being
• Goal 6: Clean Water and Sanitation
• Goal 7: Affordable and Clean Energy
• Goal 8: Decent Work and Economic Growth
• Goal 9: Industry, Innovation and Infrastructure
• Goal 12: Responsible Consumption and Production
• Goal 13: Climate Action
• Goal 17: Partnerships for the Goals

The company's initiatives contribute to these goals through various programs and activities related to health, environment, and social responsibility.

Sustainable Products & Innovation

• Recycled PET bottles
• Plant-based materials in PET bottles

Awards & Recognition

• Gomez IR site ranking 2023 Silver Award
• Gomez ESG site ranking 2023 Excellent Company Award
• Exemplar Award 2023 from Ending Workplace Tuberculosis (EWTB) Initiative

Environmental Metrics

ESG Focus Areas

• Human Capital Development
• Corporate Philosophy Realization
• Employee Engagement
• Diversity, Equity, and Inclusion (DE&I)
• Respect for Human Rights
• Sustainable Procurement
• Environmental Sustainability (Carbon Neutrality, Circular Economy, Water Neutrality, Biodiversity)
• Governance
• Risk Management
• Compliance

Environmental Achievements

• 50% reduction in CO2 emissions (Scope 1, 2) compared to 2017 by 2028
• 50% reduction in simple incineration and landfill disposal compared to 2019 by 2028
• 100% recycled materials in PET bottles and use of plant-based materials by 2030
• Expansion of factory water management program to all global locations by 2028
• Development of water use strategy for business locations in water-stressed areas by 2028
• Selected for CDP Climate Change “A List” for the second consecutive year

Social Achievements

• Established employee engagement as an indicator in the 4th MTMP
• Launched a group-wide task force to improve employee engagement
• Introduced various health initiatives, including those related to women’s health, mouth care, and non-smoking
• Certified as Health & Productivity Management Outstanding Organizations
• Certified as Sports Yell Company
• Implemented mental health initiatives, including stress checks and counseling
• Introduced open recruiting system for domestic and overseas employees
• Selected as a constituent of the iSTOXX MUTB Japan Platinum Career 150 Index
• Launched an internal whistleblowing system
• Conducted surveys and implemented measures to combat bullying and harassment
• Promotes DE&I through various initiatives, including training and seminars
• Otsuka Pharmaceutical won silver award for PRIDE Index 2023
• Taiho Pharmaceutical awarded gold medal Cancer Ally Award for the fifth consecutive year
• Support for balancing treatment and work, especially for employees with cancer
• Established employee portal site C-Guide Portal regarding cancer
• Introduced Family Smile Support System and Work Interval System
• Operates day care centers at three offices in Japan

Governance Achievements

• Established a group-wide risk management system
• Introduced Enterprise Risk Management (ERM) in 2020
• Established Otsuka Group Global ERM Policy and Implementation Guidelines in 2022
• Increased proportion of independent outside directors to more than one-third
• Established Nominating and Compensation Committee
• Regular compliance training for employees
• Operates a crisis management system
• Conducts regular audits of business partners and internal audits

Climate Goals & Targets

Environmental Challenges

• Increased global competition
• Changes in the management competition environment due to increasing digitalization
• Diversification of individual values and working styles
• Increased mobility of human resources
• Instability in raw material procurement and product supply due to supply chain disruptions
• Global warming
• Environmental load increase
• Reduced freshwater availability due to water resource risks
• Patent expiration for pharmaceuticals
• Securing and developing human resources
• Maintaining and strengthening competitiveness
• Achieving sustainable growth in a rapidly changing business environment
• Maintaining tax compliance in a globalized business environment
• Managing risks inherent in business activities

Mitigation Strategies

• Strengthening human resources, a source of innovation
• Creating an environment to maximize human resources
• Cultivating human resources who practice Ryukangodo, Jissho, and Sozosei
• Creating a workplace and organization and providing opportunities for a variety of human resources
• Creating a system to improve employee engagement
• Developing a system to nurture the next generation of human resources
• Building a robust, stable procurement system
• Achieving ethical and responsible procurement activities
• Conducting due diligence on new suppliers and risk assessments of key raw materials
• Clarifying predicted risks and purchasing from multiple suppliers
• Forming a cross-functional working group to manage procurement information
• Implementing a system that aligns with the process of data-sharing with suppliers
• Establishing guidelines for risk management during emergencies and normal times
• Reducing CO2 emissions throughout the value chain
• Reducing environmental impact by improving resource efficiency
• Promoting business activities aimed at sustainability
• Understanding water resource risks
• Management and effective use of water resources
• Introducing renewable energy and maximizing energy use efficiency
• Joining RE100 initiative
• Promoting “bottle-to-bottle” PET bottle recycling
• Reducing the amount of plastic used in products
• Establishing water management items and management standards
• Formulating water resource guidelines
• Introducing ERM
• Implementing measures, setting indicators, and receiving quarterly reports on progress in implementing countermeasures and monitoring results
• Improving effectiveness through training and surveys
• Conducting monitoring activities and holding risk management-related study sessions
• Sharing information on risks with ERM staff of major operating companies

Supply Chain Management

Supplier Audits: 597 suppliers in Japan and 56 overseas (2023)

Responsible Procurement

• Otsuka Group Procurement Policy
• Otsuka Group Sustainable Procurement Guidelines
• Otsuka Group Business Partner Code of Ethics
• Supplier assessments using GCNJ’s SAQs and Otsuka Group’s own SAQs and Environmental SAQs
• Supplier interviews

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters

Transition Risks

• Healthcare cost containment measures
• Uncertainty of new drug development
• Side effects
• Quality
• Expansion into new categories and new regions
• Food safety and quality
• Soaring raw material prices
• Patent infringement
• Litigation

Opportunities

• Development of energy-efficient products
• Growth in Nutraceutical Business

Reporting Standards

Frameworks Used: TCFD

Certifications: Health & Productivity Management Outstanding Organizations, Sports Yell Company

UN Sustainable Development Goals

• Goal 3: Good Health and Well-being
• Goal 8: Decent Work and Economic Growth
• Goal 9: Industry, Innovation and Infrastructure
• Goal 12: Responsible Consumption and Production
• Goal 13: Climate Action
• Goal 6: Clean Water and Sanitation

The report highlights how various initiatives contribute to these SDGs.

Sustainable Products & Innovation

• PET bottles made from recycled PET resin
• Products with reduced plastic usage
• Label-less products

Awards & Recognition

• PRIDE Index 2023 (silver)
• Cancer Ally Award (gold, 5 consecutive years)