Climate Change Data

Environmental Metrics

ESG Focus Areas

• Building a sustainable society for the future
• Providing the information infrastructure that is vital to people’s lives
• Developing human resources who can generate innovation

Environmental Achievements

• Reduced greenhouse gas emissions by 19.9% compared to FY2013. Achieved a PUE of 1.28 at Tokyo Data Center I.
• Listed on CDP’s Climate Disclosure Leadership Index (CDLI) for FY2015.
• 94% of greenhouse gas emissions covered under environmental management systems.

Social Achievements

• Established NRI Mirai to promote employment of people with disabilities.
• Held the 8th Annual Conference of NRI Women’s Network.
• Improved employee satisfaction scores (specific data not available).

Governance Achievements

• Adopted and publicized “NRI Corporate Governance Guidelines”.
• Obtained ISO 20000 certification for data center operations.
• Established a compliance hotline.

Climate Goals & Targets

Environmental Challenges

• Shrinking Japanese population and disruptive industrial transformations.
• Increasing risks to information security.
• Need for greater diversity in HR management.

Mitigation Strategies

• Investing in R&D, including AI and robotics research.
• Strengthening information security governance and implementing multiple safeguards.
• Implementing programs to promote diversity and support female employees.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• ESG considerations incorporated into procurement policy; requires business partners to comply with laws, regulations, and community norms.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Development of energy-efficient products and services.

Reporting Standards

Frameworks Used: GRI G4

Certifications: ISO 14001, ISO 20000, M&O Stamp of Approval (Tokyo Data Center I & Yokohama Data Center II)

Third-party Assurance: Third-party assurance for environmental data (provider not specified)

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Joint-use systems (e.g., STAR-IV, BESTWAY) that reduce energy consumption and CO2 emissions.

Awards & Recognition

• METI Minister’s Award in the category of IT energy conservation at the Green IT Awards (FY2013).

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Risk Management
• Compliance
• Supply Chain Management
• Client Relationship Management
• Innovation Management
• Information Security
• Environmental Management
• Climate Change
• Labor Practices
• Diversity
• Occupational Health and Safety
• Human Resources Development
• Business and Human Rights
• Corporate Citizenship

Environmental Achievements

• Greenhouse gas emissions reduction rate 43.8% (compared to FY2013)
• Achieved 2022 environmental goal six years early, in 2017
• Supplier's environmental target setting ratio (Category 1, 2, and 11 of Scope 3) 21.6%

Social Achievements

• Female managerial ratio 7.1%
• Female recruitment ratio 28.2%
• Received Top-Rank Eruboshi Certification (Stage 3) for excellence in promoting women's empowerment
• Selected as “Nadeshiko Brand” for promoting female career
• Opened Yumeminato Hoikuen in-office nursery

Governance Achievements

• Increased the number of independent outside directors from two to three in 2015
• Established a Nomination Committee with independent outside directors as principal members in 2017
• Established a Sustainability Activities Committee in 2017 to incorporate a sustainability perspective in management decision making and supervision
• Improved transparency and independence of the Board of Directors

Climate Goals & Targets

Environmental Challenges

• M&A associated risk: ESG risks of a company that NRI acquires
• Climate change risks associated with CO2 emission by electricity use of the Data Centers
• Cyber terrorism risk by IoT
• Human rights risks in system development using artificial intelligence (AI)
• Securing superior subcontracting partners and maintaining good business relationships with them, especially in overseas subcontracting

Mitigation Strategies

• ESG risk related due diligence including environmental and human rights risk prior to M&A
• Providing principle-based education including dissemination of the NRI Group business philosophy to acquired company managements and employees
• All data centers have acquired ISO14001 certification and set environmental targets to reduce greenhouse gas emissions by 55% compared to FY2013 by FY2030
• Utilizing emissions trading in case environmental regulations cannot be cleared
• Formulated the “AI Ethics Guideline” in FY2019
• Regularly conducting corporate screening and searching for new collaborating partners both domestically and overseas
• Strengthening this system of cooperation by regularly dispatching executives and employees to China to visit subcontracting partners and check the status of projects

Supply Chain Management

Supplier Audits: 95 companies/year

Responsible Procurement

• NRI Group Procurement Policy with “Practice of Sustainable Procurement” clause
• Requiring business partners to take activities that take into consideration ESG factors

Climate-Related Risks & Opportunities

Physical Risks

• Heavy rain, intensifying typhoons

Transition Risks

• Increase in operation costs of data centers due to introduction of new regulations or tax systems
• Competitive risk from IT companies in the US and Europe turning to zero-emission

Opportunities

• Increased demands for low carbon and zero-emission services such as Shared Online Services

Reporting Standards

Frameworks Used: GRI, TCFD, UNGC

Certifications: ISO 14001, ISO 9001, ISO 20000, ISO 27001, M&O Stamp of Approval (3 data centers), Privacy Mark

Third-party Assurance: Third-party assurance organizations for some environmental data and social contribution activity data

Sustainable Products & Innovation

• Aslead development tools for information systems
• Shared Online Services

Awards & Recognition

• CDP Climate Change A List
• CDP Supplier Engagement Leader Board
• Nadeshiko Brand

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• 66% reduction in GHG emission (Scope 1+2) from FY2019 to FY2022; FY2030 target: Net-zero (97% reduction compared to FY2019, with residual emissions neutralized); 100% renewable energy usage in data centers (FY2022)

Social Achievements

• Launched "Dokokani Byun!" bullet train service, generating new tourism demand and consumption opportunities; Provided ESG risk rating information to Australian investors; 98.1% of employees returned to work after childcare leave; Social contribution activity expenses of 1,637 million yen

Governance Achievements

• Established Sustainability Committee in FY2023; Awarded first place in IT Service/Software category for Excellence in Corporate Disclosure for the sixth consecutive year; Selected as Winner Company at JACD Corporate Governance of the Year 2022 Awards

Climate Goals & Targets

Environmental Challenges

• Difficulty in gathering data from suppliers for comprehensive supply chain emissions calculations

Mitigation Strategies

• Developed Carbon Tracing System (NRI-CTS) to link CO2 emissions information of numerous companies; Participation in WBCSD Partnership for Carbon Transparency (PACT) project

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• NRI Net-Zero Journey initiative to collaborate with business partners on the path toward Net-Zero in 2050

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: TCFD, SBT

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Carbon Tracing System (NRI-CTS)

Awards & Recognition

• Grand Prize at Japan Times Sustainable Japan Award 2022; CDP Climate Change A List company (four consecutive years); MSCI ESG Rating of AAA (two consecutive years); Selected in the CDP Supplier Engagement Leaderboard (four consecutive years); First place in IT Service/Software category for Excellence in Corporate Disclosure (six consecutive years)

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Reduced Scope 1+2 emissions by 86% compared to FY2019
• Achieved 100% renewable energy usage in data centers
• Set a net-zero greenhouse gas emissions target throughout the NRI Group's value chain by fiscal 2050 (certified in compliance with the net-zero standard of the SBT Initiative)

Social Achievements

• Launched 'Innovation Program' fostering over 750 entrepreneurs and creating 27 new companies
• Implemented 'Smart Agriculture Community' initiative integrating various services and infrastructure for farmers and residents
• Provided financial education utilizing metaverse space
• Supported the Noto Peninsula Earthquake Recovery

Governance Achievements

• Introduced the "NRI Group AI Policy"
• Awarded the "Excellent IR Company Award" by the Japan IR Association

Climate Goals & Targets

Environmental Challenges

• Labor shortages and the rise of neglected forests diminishing CO2 absorption
• Addressing the significant environmental impact of data centers
• Income threshold issue for non-regular workers

Mitigation Strategies

• Promoting "Forest-Derived J-Credit" to reduce CO2 emissions and solve regional issues related to forests
• Transitioning to 100% renewable energy and enhancing building designs to improve environmental impact of data centers
• Advocating for enabling individuals to work freely without income penalties

Supply Chain Management

Responsible Procurement

• Supporting sustainable procurement of renewable energy

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD, TNFD, SBT Initiative, UNGC, WBCSD

Certifications: CDP Climate Change A List Company

Awards & Recognition

• Good Design Award
• AWS Generative AI Competency certification
• Excellent IR Company Award
• Grand Prix at 3rd Nikkei Integrated Report Awards
• Monisu Certification