Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environment and energy conservation
• Safety, security and disaster mitigation
• Demographic change and increased health consciousness
• Corporate governance
• Corporate philosophy and compliance
• CSR communication
• Diversity
• Information security
• Product liability/Quality assurance
• Disaster prevention activities
• Occupational safety and hygiene

Environmental Achievements

• CO2 emissions released during manufacturing were 1.79 million tons, representing a 9% reduction in greenhouse gas emissions compared to fiscal 2013.
• Chemical substance emissions were 2,029 tons (reduced by 77% compared to fiscal 1998 level, down 23% from fiscal 2013).
• Waste with no effective use was 3,086 tons (reduced by 93% compared to fiscal 1998 level, down 14% from fiscal 2013).

Social Achievements

• Achieved a 30% ratio of newly recruited career-oriented female university graduates in fiscal 2015.
• 193 employees took childcare leave in fiscal 2014 (including 29 males).
• Launched NemLink, a monitoring system that uses mobile phone networks for CPAP ventilators used in the treatment of SAS.

Governance Achievements

• Established the Advisory Board (advisory body to the Board of Directors with nomination and remuneration committee functions).
• Appointed independent outside directors and statutory auditors.
• Implemented a counseling and reporting system with 62 cases in fiscal 2014.

Climate Goals & Targets

Environmental Challenges

• Tough market conditions due to competition with Chinese rivals.
• Persistently challenging business conditions with downward revisions to NHI drug reimbursement prices and growth in generics.
• Harsh operating environment in the U.S. home healthcare business.

Mitigation Strategies

• Restructuring initiatives to concentrate resources on growth fields.
• Cost-cutting measures.
• Consolidating service centers and reducing personnel in the U.S. home healthcare business.
• Expanding product lineup and actively developing new drugs.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Guidelines, UN Global Compact

Sustainable Products & Innovation

• Thermoplastic CFRP Sereebo
• KTF-374 (sheet-type sealant for surgical operations)

Environmental Metrics

ESG Focus Areas

• Reduction of environmental impacts
• Corporate governance
• Diversity

Environmental Achievements

• Decreased CO2 emissions by fuel conversion of in-house power generation equipment at the Mishima Factory of Toho Tenax Co., Ltd. and the shutdown of the Singapore plant.
• 84% decrease in chemical substance emissions compared to FY1998
• 91% decrease in waste with no effective use compared to FY1998

Social Achievements

• Set a target of 30% or higher ratio of newly recruited career-oriented female university graduates
• Introduced a re-employment system
• Mie Kamiyama won the SCEJ Award for Outstanding Women’s Activity

Governance Achievements

• Strengthened corporate governance system to ensure high transparency and prompt decision-making
• Established relationships of trust through dialogue with shareholders and investors

Climate Goals & Targets

Environmental Challenges

• Intensified competition
• Revisions to NHI drug price reimbursements
• Advance development costs
• Downward revisions of Japan’s National Health Insurance drug reimbursement prices
• Higher sales of generic drugs
• Stronger yen in the first half of fiscal 2016
• Market conditions remained sluggish in China
• Reflective films for use in liquid crystal display (LCD) televisions remained under pressure in terms of both volume and pricing due to the emergence of Chinese manufacturers

Mitigation Strategies

• Steady execution of restructuring initiatives
• Maximizing profit for the period by expanding sales of core products and services
• Investing actively in transformation and growth strategies
• Cost reductions (including those realized through restructuring initiatives)
• Improving power generation efficiency
• Integrating domestic polyester film production facilities
• Converting joint ventures in Japan and Indonesia into wholly owned subsidiaries
• Strengthening the operating structure through such means as promoting production at optimal sites, and pushing ahead with differentiated businesses centered on our proprietary materials

Supply Chain Management

Supplier Audits: 87% of suppliers by rating (for Groups I-III, designated as “Okay to continue business”) in Japan

Responsible Procurement

• CSR procurement

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Guidelines

Sustainable Products & Innovation

• Thermoplastic CFRP Sereebo
• LIELSORT LIB separator

Awards & Recognition

• EcoBalance Award for Best Business Practices
• SCEJ Award for Outstanding Women’s Activity

Environmental Metrics

ESG Focus Areas

• Environment
• Society
• Governance

Environmental Achievements

• Reduced CO2 emissions from manufacturing operations by 6.2% annually on average (2013-2017)
• Reduced chemical substance emissions by 92% compared to 1998 levels
• Reduced waste with no effective use by 4% compared to 2016 levels

Social Achievements

• Increased the number of female employees in managerial positions in Japan
• Launched Sleep Styles sleep enhancement program
• Established a counseling service for employees in China

Governance Achievements

• Strengthened corporate governance system to ensure high transparency and prompt decision-making
• Established a Nomination Advisory Committee and a Remuneration Advisory Committee
• Revised Teijin Group’s CSR Procurement Guidelines

Climate Goals & Targets

Environmental Challenges

• Market conditions (exchange rate/crude oil)
• Product quality issues
• Natural disasters
• Intensified competition
• Legislative changes in countries
• Price drops due to drug price revisions
• Discovery of adverse side effects
• Downward revisions of Japan’s National Health Insurance drug reimbursement prices

Mitigation Strategies

• Implemented Total Risk Management (TRM) Committee
• Cost reductions through restructuring initiatives
• Strengthening product cost competitiveness
• Reorganizing the Head Office
• Enhancing productivity through operating process innovation
• Maximizing earnings from existing growth drivers
• Focusing on drug discovery research
• Strengthening home healthcare using IoT

Supply Chain Management

Responsible Procurement

• Revised CSR Procurement Guidelines (November 1, 2017)

Climate-Related Risks & Opportunities

Opportunities

• Weight-reducing materials to enhance environmental performance of transportation

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Standards

Sustainable Products & Innovation

• Weight-reducing materials (carbon fiber, polycarbonate resin)
• Recycled polyester fibers
• High-performance microporous membranes

Awards & Recognition

• Gold Partner Certificate from EcoVadis (Teijin Aramid B.V.)
• National Occupation Safety and Health Award (Teijin Cord (Thailand) Co., Ltd.)

Environmental Metrics

ESG Focus Areas

• Environmental Value Solutions
• Safety, Security and Disaster Mitigation Solutions
• Demographic Change and Increased Health Consciousness Solutions
• Corporate Governance
• Diversity

Environmental Achievements

• Achieved a 4.9% average annual decrease in CO2 emissions from 2011 to 2018 (despite a 5% increase in 2018 due to the inclusion of CSP).
• Achieved a 77% decrease in chemical substance emissions from 1998 to 2018 (despite a 15% increase in 2018 due to the inclusion of CSP).
• Achieved a 49% decrease in waste with no effective use from 1998 to 2018 (despite a significant increase in 2018 due to the inclusion of CSP).
• First use of CFRTP (Carbon Fiber-Reinforced Thermoplastic) for structural parts in mass-produced automobiles.
• Formed agreement with Boeing for authorization of carbon fiber intermediate materials.
• Extended contract for supply of TENAX carbon fiber for the Airbus A220.
• Constructed world’s first building using advanced fiber-reinforced wood.
• Established new SMC manufacturing line at CSP Europe.
• Purchased German company Ziegler (manufacture and sale of automotive interior materials).

Social Achievements

• Launched Sleep Styles, a sleep quality improvement program.
• Began offering Sleepcheck, a sleep monitoring service for stress-check users.
• Began sale of new product using super barley.
• Acquired production/marketing approval for Revcovi 2.4 mg for intramuscular injection and rheumatoid arthritis drug biosimilar.
• Began sale of febuxostat in China.
• Released Hi-Sanso-i, Teijin’s latest oxygen concentrator.
• Entered agreement with Yoshindo Inc. for sale of rheumatoid arthritis drug biosimilar.
• Began clinical trials of JTR-161 dental pulp stem cells.
• Began sale of Inulia fermentation dietary fiber.

Governance Achievements

• Endorsed the Task Force on Climate-related Financial Disclosure report.
• Established a special subsidiary company to promote employment for persons with disabilities.
• Revised Code of Conduct.
• Appointed Ms. Karola Japke as the first non-Japanese CHO.

Climate Goals & Targets

Environmental Challenges

• Temporary deterioration in the productivity of CSP.
• Rapid deterioration in market conditions for polycarbonate in the second half of fiscal 2018.
• Expected decline in earnings from febuxostat in overseas markets.
• Direct and indirect impacts of trade tensions between the U.S. and China.
• Increased raw material and fuel prices.
• Slowdown in demand for polycarbonate resin and decline in market prices.
• Sluggish smartphone demand impacting sales of LIELSORT lithium-ion battery separators.
• Unseasonable weather impacting sales of heavy winter clothing.
• Increased raw material and distribution costs.
• Decelerated growth in China impacting sales of automotive materials.

Mitigation Strategies

• Yields recovered by the end of fiscal 2018 at CSP.
• Successfully minimized the impact on operations from polycarbonate market deterioration.
• Projecting higher earnings on higher sales in the Materials Business including aramid fibers, and the Healthcare Business in Japan.
• Closely monitoring the impacts of trade tensions and market conditions.
• Shifting to high-value-added products less susceptible to market price fluctuations.
• Expanding production capacity for aramid fibers.
• Promoting business development in Europe/China.
• Creating and expanding new Healthcare Businesses and optimizing resource allocation.
• Strengthening production cost competitiveness and reviewing business processes using RPA (Robotic Process Automation).

Supply Chain Management

Responsible Procurement

• CSR Procurement Guidelines

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters
• Flooding

Transition Risks

• Climate change
• Stricter environmental regulations
• Regulatory trends surrounding marine plastic waste

Opportunities

• Weight reduction and increased efficiency through high-performance materials technologies.
• Development of energy-efficient products.
• Growth in the markets for recycling and alternative products.

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Standards, UN Global Compact, TCFD

Third-party Assurance: Independently assured indicators

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 9 (Industry, innovation and infrastructure)
• Goal 12 (Responsible consumption and production)
• Goal 13 (Climate action)
• Goal 3 (Good health and well-being)

Addressing issues in three fields: environmental value, safety, security and disaster mitigation, and demographic change and increased health consciousness; these fields overlap with the SDGs.

Sustainable Products & Innovation

• Sereebo (lightweight automotive composite)
• AFRW (advanced fiber-reinforced wood)
• TENAX TPUD (thermoplastic unidirectional pre-impregnated tape)
• BARLEYmax super barley
• Inulia fermentable dietary fiber

Awards & Recognition

• GM’s 27th “Supplier of the Year” awards
• 2018 Japan Resilience Award (AFRW)
• Nadeshiko Brand company
• Competitive IT Strategy Company
• Health Management Excellent Corporation
• Recopick shelving management system award in 20th Automatic Identification Systems Grand Prix