Climate Change Data

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Personnel Strategy
• CSR Initiatives

Environmental Achievements

• Groupwide emissions in FY2019.3 were down approximately 7% from FY2015.3, to 59,551 tons of CO2. Conversion from halogen lamps and fluorescent lighting to LED lamps in amusement machines and store lighting at amusement facilities.

Social Achievements

• Increased the number of outside directors from three to four, making up one-third of the Company’s Board of Directors. All outside directors meet the conditions for independent officers.
• Implemented initiatives to limit overtime to 45 hours per month (up to 75 hours per month 6 times per year); secure intervals between work of 10 hours or more; prohibit overtime after 10:00 pm, in principle; and achieve an annual planned utilization rate for paid leave of 70% or more.

Governance Achievements

• Increased the number of outside directors from three to four, making up one-third of the Company’s Board of Directors. All outside directors meet the conditions for independent officers. The Independent Directors and Audit & Supervisory Board Members Committee conducts evaluations of the effectiveness of the Board of Directors.
• From FY2020.3, the Personnel Committee is chaired by an outside director, ensuring further transparency and fairness.

Climate Goals & Targets

Environmental Challenges

• Rapid pace of change in the digital field making simple extension of traditional business practices ineffective.
• Dramatic changes in the operating environment, including diversification of media and shift to subscription-based business models.

Mitigation Strategies

• Emphasis on a customer-centric approach, both in the provision of high-quality content and in operations.
• Careful consideration of possible changes in the digital and network fields; taking steps to address new technologies and platforms and to foster innovation in existing technologies.

Supply Chain Management

Supplier Audits: 168 plants in FY2019.3 (BANDAI Factory Audits)

Responsible Procurement

• BANDAI Code of Conduct (8 COC standards)
• CSR Procurement Questionnaire (7 major items)

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: International Integrated Reporting Framework of the IIRC

Environmental Metrics

ESG Focus Areas

• Corporate Governance
• Personnel Strategy
• CSR Initiatives

Environmental Achievements

• Groupwide emissions in FY2020.3 were down approximately 2.3% from the previous fiscal year, to 58,169 tons of CO2.
• 10% reduction in electricity use in comparison with fluorescent lights (CLENA 2 amusement machine)

Social Achievements

• Donated ¥100 million to the COVID-19 Solidarity Response Fund for the World Health Organization (WHO)
• Implemented various initiatives to support employees working from home during the COVID-19 pandemic.
• Introduced J Project FIRST and J Project NEXT training programs to promote active careers for women.

Governance Achievements

• Outside directors make up one-third of directors, securing objectivity and transparency.
• Established the Independent Directors and Audit & Supervisory Board Members Committee for objective evaluation of the Board of Directors.
• Implemented a variety of employee training related to ethical expression.

Climate Goals & Targets

Environmental Challenges

• Spread of COVID-19 impacting amusement facilities, events, and production lines.
• Uncertainty in the operating environment for amusement facilities and amusement machines.
• Decreased demand for amusement machines due to facility closures.
• Impact on consumption due to store closures and distribution restrictions.
• Influence on events (postponement, cancellation) and on related promotions, etc., in Japan and overseas.

Mitigation Strategies

• Implemented business continuity plan (BCP) and business continuity management (BCM) measures.
• Held regular meetings of the Crisis Management Committee.
• Provided emergency social support through donations and initiatives.
• Recorded a valuation loss on amusement machine work in process and an impairment loss on certain facilities’ fixed assets.
• Reevaluated amusement facility development initiatives and amusement machine development system.

Supply Chain Management

Supplier Audits: 168 companies (BANDAI Factory Audits); 1 company (amusement machine assembly plants)

Responsible Procurement

• BANDAI Code of Conduct (8 standards)
• CSR Procurement Questionnaire (7 major items)

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: International Integrated Reporting Framework of the IIRC

Certifications: ISO 13485 (SEEDS CO., LTD.), ISO 17025 (SEEDS CO., LTD.)

Sustainable Products & Innovation

• Eco Plastic Models using recycled materials

Awards & Recognition

• METI Minister’s Award (Product Safety)
• Certified as a Product Safety Contributor Gold Company

Environmental Metrics

ESG Focus Areas

• Climate Change
• Decarbonization
• Human Resources
• Diversity & Inclusion
• Corporate Governance
• Supply Chain Management
• IP Protection

Environmental Achievements

• Reduced energy-related CO2 emissions at Group business sites by 10.2% vs. FY2020.3 (29.4% vs. FY2014.3)
• Gundam Recycling Project launched, collecting Gundam plastic model runners for recycling.
• GUNDAM FACTORY YOKOHAMA switching to renewable energy.

Social Achievements

• Established new working style guidelines, aiming for 70% work-from-home ratio in Japan.
• Increased child-rearing support money for Group companies in Japan.
• Received Kurumin certification for support of child-rearing (BANDAI NAMCO Entertainment Inc., BANDAI CO., LTD., and BANDAI NAMCO Amusement Inc.).
• Initiatives to promote diversity and inclusion, including aiming to increase the ratio of female managers to 20%.

Climate Goals & Targets

Environmental Challenges

• COVID-19 impact on amusement facilities, live events, and production schedules.
• Dependence on specific IP.
• Intensifying competition in global markets.
• Changes in customer lifestyles and preferences.
• Climate change and environmental concerns.
• Securing and developing human resources.

Mitigation Strategies

• Strengthened sales and marketing through digital technologies.
• Implemented business structural reforms.
• Introduced new working styles (remote work, flextime).
• Advanced energy-saving measures and introduced renewable energy.
• Strengthened risk management system.
• Implemented initiatives to prevent the spread of COVID-19.
• Accelerated digital transformation (DX) initiatives.
• Strengthened IP axis strategy.
• Expanded business in key regions (China, North America).

Supply Chain Management

Supplier Audits: 166 BANDAI Factory Audits (all suppliers subject to audits); 139 secondary supplier audits (BANDAI CO., LTD.)

Responsible Procurement

• BANDAI Code of Conduct (8 standards)
• ICTI Code of Business Practices (for primary factories in BANDAI (SHENZHEN) CO., LTD.)
• CSR Procurement Questionnaire (BANDAI NAMCO Amusement Inc.)

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters (property damage, supply chain interruption, resource depletion)

Transition Risks

• Higher raw materials costs due to carbon regulations and plastic use regulations
• Higher costs due to new technologies and R&D investment

Opportunities

• Lower electricity costs due to energy-saving measures
• Lower costs due to efficient production/transportation processes
• Creation of new markets due to changes in consumer preferences

Reporting Standards

Frameworks Used: International Integrated Reporting Framework, SASB disclosure standards for Toys & Sporting Goods and Software and IT Services, TCFD recommendations

Certifications: Product Safety Contributor Gold Company

Third-party Assurance: Bureau Veritas Japan Co., Ltd.

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Capsule-less products
• Shifting from plastic blister packaging to cardboard packaging

Awards & Recognition

• METI Minister’s Award (Product Safety)
• Commissioner of the Japan Patent Office Award (IP protection)

Environmental Metrics

ESG Focus Areas

• Sustainability

Environmental Achievements

• Reduced CO2 emissions by 10.6% compared with FY2020.3 (29.7% reduction compared with FY2014.3)
• Switched to renewable energy for power used at GUNDAM FACTORY YOKOHAMA
• Collected more than 11 tons of Gundam plastic model runners in the Gunpla Recycling Project (exceeding the annual target)

Social Achievements

• Increased ratio of female managers in business management companies from 17.4% at the end of FY2018.3 to 21.3% at the end of FY2022.3
• Implemented the Gunpla Recycling Project in collaboration with fans
• Launched the Gundam Open Innovation project to address social issues through the use of Gundam IP

Governance Achievements

• Transitioned from a company with an Audit & Supervisory Board to a company with an Audit & Supervisory Committee
• Increased the number of outside directors to five out of 14
• Added sustainability evaluation to officer remuneration system from FY2023.3

Climate Goals & Targets

Environmental Challenges

• Dependence on specific IP, businesses, or regions
• Intensifying competition in global markets
• Securing human resources
• Addressing climate change and environmental change
• Threats, such as disasters, epidemics, and terrorism
• Higher raw materials costs as well as production and procurement costs due to carbon regulations and plastic use regulations
• Higher costs due to the introduction of new technologies, investment in R&D, or capital investment
• Property damage, supply chain interruption, or resource depletion due to natural disasters
• IP infringement
• Unauthorized access to Group companies

Mitigation Strategies

• Implementing strategic investment (¥40 billion over three years)
• Strengthening collaboration among Units and cooperation with external partners
• Establishing balanced IP, business, and regional portfolios
• Strengthening quality control/inspection systems, strengthening employee training and supply chain management
• Strengthening development system with focus on quality
• Appropriately utilizing and protecting IP, including the elimination of counterfeit products and services
• Taking steps to achieve workplace environments that foster mutual respect, including the introduction of systems and frameworks that facilitate active careers for diverse human resources
• Bolstering sound financial position
• Expanding global rollouts, implementing organizational restructuring
• Promoting collaboration among regions and businesses
• Expanding potential for the creation of new markets, businesses, and IP
• Strengthening information security measures
• Implementing countermeasures against IP infringement

Supply Chain Management

Supplier Audits: 180 plants in FY2022.3 (BANDAI Factory Audits)

Responsible Procurement

• BANDAI COC Declaration
• CSR Procurement Questionnaire

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters

Transition Risks

• Carbon regulations
• Plastic use regulations

Opportunities

• Lower electricity costs due to energy-saving
• Lower costs due to the introduction of efficient production/transportation processes
• Creation of new markets due to changes in consumer preferences

Reporting Standards

Frameworks Used: IFRS Foundation’s Integrated Reporting Framework, SASB Standards on Toys & Sporting Goods and Software & IT Services, TCFD recommendations

Third-party Assurance: Bureau Veritas Japan Co., Ltd.

Sustainable Products & Innovation

• MONO capsule
• MAP capsule

Awards & Recognition

• 2021 Best Innovator Award at the Bandai Namco Awards
• Product Safety Contributor Gold Company (METI)
• Gold Stevie® Award (Asia-Pacific Stevie® Awards)

Environmental Metrics

ESG Focus Areas

• Decarbonization
• Human Rights
• Circular Economy
• Employee Well-being
• Supply Chain Management

Environmental Achievements

• Achieved net-zero CO2 emissions from office operations at several major bases.
• Reduced energy use-derived CO2 emissions at Group business sites by 25.4% vs FY2019.
• Collected approximately 40 tons of runners (from model kits) for recycling in FY2024.3.
• Reduced food loss by 10.5 tons.

Social Achievements

• Launched the Gundam Educational Program, reaching 7,554 students.
• Held Gunpla Academia classes for over 600,000 elementary school students.
• Implemented the Gunpla Recycling Project, collecting approximately 40 tons of runners.
• Maintained high overall scores in the FY2024.3 Employee Engagement Survey.
• Formulated the Bandai Namco Group Human Rights Policy in November 2023.

Governance Achievements

• Transitioned to a company with an Audit & Supervisory Committee in June 2022.
• Revised the questionnaire for evaluating the effectiveness of the Board of Directors.
• Implemented a sustainability evaluation for director remuneration (excluding Audit & Supervisory Committee members and outside directors).

Climate Goals & Targets

Environmental Challenges

• Dependence on specific IP, businesses, or regions.
• Lengthening development periods and rising investment costs for digital content.
• Securing and developing talent for title development.
• Higher raw materials costs due to carbon regulations and plastic use regulations.
• Supply chain interruption due to natural disasters.
• Decline in revenue from live events due to decreased willingness to go out.
• Information leaks and effects on business systems resulting from cyberattacks.
• Shortage of animators.
• Intensified competition in building relationships with external creators and partner companies.
• Rapid changes in markets and customers; technological progress.
• Increased investment related to IP creation/acquisition, and protection.
• Intensifying competition.
• Problems with quality in products and services that utilize IP.
• Damage to IP value, such as IP infringement.
• Labor shortages.
• Decline in opportunities to open new brick-and-mortar stores in Japan.

Mitigation Strategies

• Implementing strategic investments to strengthen the IP axis strategy.
• Strengthening the risk management system.
• Strengthening initiatives to enhance IP recognition as well as global rollouts.
• Strengthening digital initiatives, such as digital marketing for online events and enhancing e-commerce capabilities.
• Strengthening development system with focus on quality and increasing efficiency.
• Enhancing production environment, and strengthening talent acquisition and development.
• Continuing communication with fans after title releases.
• Advancing decarbonization initiatives.
• Promoting a circular economy.
• Advancing environmentally friendly products.
• Reducing waste.
• Strengthening monitoring; strengthening vulnerability countermeasures.
• Expanding information security departments.
• Strengthening information security education.
• Collecting the latest information, strengthening relationships with external specialists.
• Establishing a personal information management system compliant with global privacy laws.
• Bolstering a sound financial position.
• Reforming and increasing the efficiency of the value chain in development and production.
• Promoting initiatives for recycling and initiatives to address the trend away from the use of plastic, such as new material R&D.
• Dispersing manufacturing bases, strengthening quality control system.
• Consolidating studio and production functions.
• Collecting know-how regarding visual products, music products, and live events.
• Enhancing production environment, securing human resources, strengthening human resources development.
• Investing to enhance production technologies.
• Strengthening collaboration with all partners inside and outside the Company.
• Strengthening collaboration with Group resources, such as IP, products, and services.
• Increasing efficiency, strengthening stable business foundation.
• Addressing diverse working styles.

Supply Chain Management

Supplier Audits: Nearly all overseas final packaging plants that manufacture products for the Japanese market (approximately 300 companies in fiscal 2023) undergo Code of Conduct audits.

Responsible Procurement

• Green procurement initiatives
• Use of eco-friendly components and materials
• Code of Conduct audits of suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Intensification of abnormal weather
• Droughts
• Rising sea levels
• Rise in the average temperature
• Changes in rainfall and weather patterns
• Increase in infectious diseases

Transition Risks

• Introduction of carbon pricing
• Regulations on the use of fossil fuels
• Regulations on plastics and resource recycling
• Renewable energy and energy conservation policies

Opportunities

• Lower electricity costs due to energy saving
• Lower costs due to the introduction of efficient production/transportation processes
• Creation of new markets due to changes in customer preferences
• Enhancing the corporate image through environmental initiatives
• Creating business opportunities through environmental commitment

Reporting Standards

Frameworks Used: IFRS Foundation’s Integrated Reporting Framework, SASB Standards on Toys & Sporting Goods and Software & IT Services, TCFD recommendations

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 12 (Responsible consumption and production)
• Goal 13 (Climate action)
• Goal 8 (Decent work and economic growth)
• Goal 17 (Partnerships for the goals)

Initiatives contribute to these goals through decarbonization efforts, circular economy initiatives, responsible supply chain management, employee well-being programs, and collaborations with stakeholders.

Sustainable Products & Innovation

• Eco-plastic Gunpla trial kits
• CLENA3 crane game machine
• Gundam craft puzzles made from bamboo
• Gundam model kits using alternative materials

Awards & Recognition

• Bandai Namco Award 2023 (Best Sustainability Grand Prize for CLENA series)
• Jam Spirit Award (Green Game Jam)