Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Preservation
• Occupational Safety and Health
• Process Safety and Disaster Prevention
• Quality Management
• Product Safety
• Logistics Safety
• Social Communication
• Corporate Governance
• Compliance with Laws and Regulations

Environmental Achievements

• Reduced energy unit consumption to 88.5% of the 1990 level in fiscal 2004.
• Reduced VOC emissions by about 30% in fiscal 2004 compared to fiscal 2000.
• Reduced total amount of designated chemical substances released into the environment by 32% in fiscal 2004 compared to fiscal 2001.
• No environmental accidents in fiscal 2004.

Social Achievements

• Received the 2004 Prime Minister’s Commendation for Excellent Health Promotion Efforts.
• Donated a total of 20 million yen to the governments of Thailand and Indonesia for contributions to the recovery from the 2004 tsunami.
• Implemented a company-wide safety campaign to secure occupational safety and health.
• Decreased claims and complaints by 11%.

Governance Achievements

• Established the CSR Committee and the CSR Division in June 2005.
• Adopted an Executive Officer System to clarify management roles and responsibilities.
• Implemented legal compliance audits by the head office auditing group.

Climate Goals & Targets

Environmental Challenges

• Did not clear the numerical target for reduction of industrial waste going into landfill disposal.
• Experienced 19 labor accidents and 4 equipment accidents in fiscal 2004.
• Increased greenhouse gas emissions compared to the fiscal 2003 level.
• Increased discharge of vinyl chloride monomer and benzene.

Mitigation Strategies

• Formulating greenhouse gas emissions reduction policy and plan.
• Formulating policy and plan on reduction of emissions of volatile organic compounds (VOCs).
• Formulating a new load reduction target and policy toward the Zero-Emissions goal.
• Formalizing various activities in a safety campaign.
• Evaluating and improving workplace culture by external safety diagnosis.
• Drafting and implementing measures incorporating the concepts of punishment and reward.

Supply Chain Management

Supplier Audits: 138 logistics contractors audited in fiscal 2004.

Responsible Procurement

• Code of conduct
• Supplier sustainability requirements

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI (Global Reporting Initiative)

Certifications: ISO 9001, ISO 14001, OHSAS 18001

Sustainable Products & Innovation

• LACEA™ (plant-derived bio-based polymers)
• Starkle™ (low-toxicity insecticide)
• Takelac W (VOC-free coating)
• SWP™ (asbestos substitute)

Awards & Recognition

• Prime Minister’s Commendation for Excellent Health Promotion Efforts
• Various other awards listed on page 51

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Reduced GHG emissions from 6.11 million tons in FY2006 to 6.02 million tons in FY2007.
• Reduced overall VOC emissions by about 61% from the FY2001 level.
• Achieved industrial waste minimization at the Ichihara Works for a second consecutive year (0.4% landfill disposal).

Social Achievements

• Established the Mitsui Chemicals Group Action Guidelines, reflecting employee opinions.
• Launched various social contribution activities, including clean-up campaigns and Wonders-in-Chemistry classes.
• Introduced programs to support employee work-life balance, including childcare and nursing care assistance.

Governance Achievements

• Established the Internal Control Division to enhance internal auditing.
• Established the Risk & Compliance Committee to strengthen risk management.
• Implemented company-wide compliance education (approx. 12,000 participants).

Climate Goals & Targets

Environmental Challenges

• High final disposal rate of industrial waste at the Omuta Works.
• Occurrence of four accidents in FY2007.
• Gap in safety awareness between managers and operators.

Mitigation Strategies

• Organized a Task Force to address the high waste disposal rate at Omuta Works.
• Implemented thorough on-site accident prevention measures and overseas on-site safety instruction.
• Developed action plans by production managers and dispatched support teams of knowledgeable retirees to narrow the gap in safety awareness.

Supply Chain Management

Supplier Audits: 806 suppliers surveyed, 589 responses (73% response rate)

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy (emphasizes legal compliance, equal opportunity, environmental harmony, and CSR considerations).

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, Japan’s Ministry of the Environment Environmental Reporting Guideline 2003, Japan’s Ministry of the Environment Environmental Accounting Guideline 2005

Certifications: ISO 9001, ISO 14001, OHSAS 18001

Sustainable Products & Innovation

• Mitsui’s AdBlue (NOx reducing additive)

Awards & Recognition

• Various awards for accident-free records, environmental performance, and safety initiatives (see page 53).

Environmental Metrics

ESG Focus Areas

• Economy
• Environment
• Society

Environmental Achievements

• Reduced GHG emissions by 260,000 tons via energy-saving measures
• Achieved GHG Intensity Index of 90 (compared to fiscal 1991 level)
• Reduced VOC emissions to 2,332 tons
• Achieved industrial waste minimization at five of six domestic manufacturing sites
• Average landfill rate of industrial waste for worldwide subsidiaries: 0.5% in Japan, 0.4% outside Japan
• Improved ELP indicator to 54 and eco-efficiency indicator to 232 from fiscal 1998

Social Achievements

• Implemented programs to eliminate overtime and ensure annual leave is taken
• Improved employees’ understanding of a system to support childcare and family care
• Encouraged male employees to take childcare leave (36 in FY 2010)
• Continued programs to eliminate overtime and ensure annual leave is taken

Governance Achievements

• Periodic review of each BCP (Business Continuity Plan)
• Strengthening of education on the Antitrust Act and monitoring
• Continued implementation of compliance training
• Audited compliance with safety and environment-related laws and regulations (zero violations)
• Improved responsible-care support database

Climate Goals & Targets

Environmental Challenges

• Accident and explosion at Shimonoseki Mitsui Chemicals, Inc.
• Failure to meet occupational injury frequency rate targets
• Harsh business climate impacting net sales
• Need to reduce total CO2 emissions in methanol synthesis process
• Need to expand hydrogen sources for methanol synthesis

Mitigation Strategies

• Revamped vision for establishing safety at a fundamental level
• Implemented preventive measures at manufacturing sites and across the group
• Continued efforts to reduce environmental impact
• Planned to add innovative technologies to existing technologies and advance energy conservation
• Planned to expand hydrogen sources, starting with using hydrogen produced as a by-product of coke furnaces

Supply Chain Management

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy (fair and good-faith purchasing activities)

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products and low-carbon technologies

Reporting Standards

Frameworks Used: GRI Sustainability Reporting Guidelines 2006, Environmental Reporting Guideline 2007 of Japan’s Ministry of the Environment, Environmental Accounting Guideline 2005 of Japan’s Ministry of the Environment, UN Global Compact

Sustainable Products & Innovation

• Plant-derived polyurethane
• Methanol synthesized from CO2 and hydrogen

Environmental Metrics

ESG Focus Areas

• Safety
• Environmental Protection
• Social Responsibility
• Governance

Environmental Achievements

• Reduced greenhouse gas emissions by 50,000 tons through energy saving measures, exceeding the target of 10,000 tons.

Social Achievements

• Reduced the overall frequency of workplace accidents.

Governance Achievements

• Established the Fundamental Safety Committee, chaired by the President, to conduct a comprehensive safety review.

Climate Goals & Targets

Environmental Challenges

• Explosion and fire at Iwakuni-Ohtake Works resulting in one fatality and 25 injuries.
• Failure to achieve the target of completely eliminating workplace accidents.

Mitigation Strategies

• Established an Accident Investigation Committee with outside experts.
• Established a Fundamental Safety Committee to identify root causes of safety issues and implement improvements.
• Implemented company-wide safety review and improvements based on the committee's findings.

Supply Chain Management

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, ISO 26000

Awards & Recognition

• Energy Conservation Grand Prize
• CSR DIW 2011 Award

Environmental Metrics

ESG Focus Areas

• Safety
• Environmental Protection
• Chemical Management
• Quality
• Logistics
• Human Rights
• Stakeholder Engagement
• Supply Chain Management

Environmental Achievements

• Reduced greenhouse gas emissions by over 90,000 tons (compared to a target of at least 60,000 tons)
• Achieved industrial waste minimization targets at all domestic manufacturing sites
• Average percentage of industrial waste sent to landfill at overseas affiliates: 0.6%

Social Achievements

• Received a special award from the Development Bank of Japan (DBJ) under its DBJ Health Management Rating scheme
• Implemented measures to create more free time for employees
• Organized family care seminars

Governance Achievements

• Implemented fundamental safety initiatives following an accident
• Established a Fundamental Safety Committee
• Implemented a Chemical Management Strategy

Climate Goals & Targets

Environmental Challenges

• Explosion and fire at the resorcinol production facility at the Iwakuni-Ohtake Works
• Deterioration in business conditions due to yen appreciation and global downturn
• Achieving target for frequency of occupational injuries

Mitigation Strategies

• Implemented preventive measures to tackle the immediate and underlying causes of the accident
• Established a Fundamental Safety Committee
• Took steps to transform the business portfolio
• Implemented fundamental safety initiatives

Supply Chain Management

Supplier Audits: 18 suppliers visited and assisted with improvements

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy
• CSR Procurement Survey

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products
• Tahara Solar-Wind™ Joint Project

Reporting Standards

Frameworks Used: GRI, ISO 26000

Certifications: ISO 9001, ISO 14001, OHSAS 18001

Sustainable Products & Innovation

• AdBlue™
• SOLAR EVA™
• ECONICOL™

Awards & Recognition

• Smart Life Project Award
• DBJ Health Management Rating (Special Award)
• JCIA Effort Award

Environmental Metrics

ESG Focus Areas

• Climate Change
• Safety
• Responsible Care
• Risk Management
• Social Contribution
• Corporate Governance
• Human Rights
• Supplier Relations
• Stakeholder Engagement
• Biodiversity
• Product Stewardship
• Chemical Management
• Quality
• Employee Well-being
• Community Relations

Environmental Achievements

• Reduced greenhouse gas emissions by over 50,000 tons (vs. a target of 20,000 tons)
• Achieved industrial waste minimization targets at all domestic manufacturing sites for the fourth straight year
• Achieved average final disposal ratio of 0.4% for industrial waste at overseas affiliates (vs. a target of 1%)
• Commenced commercial operations at the Tahara Solar-Wind™ Joint Project

Social Achievements

• Opened Plant Operation Technology Training Center to third parties for safety training
• Launched WholeYou™ healthcare brand in the United States
• Donated benches made from Yakushima cedar to Yakushima Island
• Conducted research on organisms living in paddy fields
• Held workshops for working parents
• Expanded activities through the implementation of overseas (Singapore) laboratory “The Wonder of Chemistry” classes

Governance Achievements

• Extended CSR Committee membership to include heads of all divisions
• Established Global Chemical Regulation Response Team
• Introduced an executive officer system to clarify executive capabilities
• Established the Risk & Compliance Committee and the Responsible Care Committee as separate entities from the CSR Committee
• Revised the Responsible Care Policy

Climate Goals & Targets

Environmental Challenges

• Reducing the environmental impact of business activities and appropriately managing chemical substances
• Ensuring stable supply of industrial materials and optimizing domestic production
• Maintaining safety as a core management policy
• Sound chemical substance management to minimize negative impact on people’s health and the environment
• Increasing customer satisfaction through quality management
• Balancing sustainable growth of the company and the happiness and self-fulfillment of employees
• Maintaining communication with society
• Addressing climate change and reducing GHG emissions
• Responding to urbanization
• Addressing declining birthrates and aging populations
• Addressing food problems
• Ensuring CSR procurement
• Ensuring compliance
• Securing hydrogen supplies for CO2 fixation

Mitigation Strategies

• Implementing greenhouse gas reduction plans, energy saving, switching to alternative fuels, and creating innovative processes
• Focusing efforts on contributing to the sustainable development of regions and training personnel
• Implementing safety measures and striving to be recognized by society as a company with an exemplary safety record
• Evaluating risks posed by chemical substances and taking steps to ensure people’s health and reduce environmental impact
• Implementing a two-pronged approach to quality management (built-in quality activities and winning customer trust activities)
• Creating an employee-friendly work environment and respecting human rights
• Engaging in a wide range of communication activities with stakeholders
• Developing lighter-weight, environment-friendly automotive materials
• Providing creative health solutions through open innovation
• Expanding product lines and technologies to contribute to globally shared value chains for increased food production and hygiene
• Formulating the MCI Group Purchasing Policy and procuring from suppliers who comply with laws and share the company’s values
• Organizing compliance awareness training and example-based workplace discussions
• Compiling a compliance guidebook
• Exploring biomass-derived hydrogen

Supply Chain Management

Supplier Audits: 1,647 suppliers surveyed in 2013; 3 suppliers visited and assisted with improvement measures in 2014

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy
• CSR procurement activities
• Green purchasing
• Policy on conflict minerals

Climate-Related Risks & Opportunities

Opportunities

• Development of energy-efficient products
• Development of renewable energy technologies

Reporting Standards

Frameworks Used: GRI G4, ISO 26000, UN Global Compact

Certifications: ISO 14001, OHSAS 18001, ISO 9001, ISO 13485, ISO 17025, ISO 50001, TS 16949, Eco-Rail Mark

Sustainable Products & Innovation

• Blue Value™ products
• ECONICOL™
• TAFMER™
• Mitsui EPT™
• Polypropylene (PP) compounds
• ADMER™
• AdBlue™
• NONROT™
• TAFNEL™ Oil Blotter™
• MILASTOMER™
• Polymetac™
• COPPERSTOPPER™
• ESPOIR™
• ResverAQUA
• SWP™
• SOLAR EVA™
• SOLAR ASCE™

Awards & Recognition

• Best IR Award
• RC Special Recognition Award
• RC Merit Award
• 2014 Green Cross Award
• Social Contribution Commendation Award
• Japan Petrochemical Industry Association Maintenance Award
• Outstanding Boiler Engineering Award
• Safety & Health Achievement Award
• 10th No accidents Certification
• Zero Accident Business Site Award
• Excellent Business Site Award
• Thailand 5S Award Golden Level
• CSR - DIW Continuous Award 2014
• The Outstanding Establishment on Labor Relations & Welfare for Year 2014
• The Certificate of Good Safety Performance (National Level)
• The Certificate of Corporate Good Governance Award in 2013
• 2014 National Occupational Safety and Health Award
• Award for RC (Responsible Care) codes

Environmental Metrics

ESG Focus Areas

• Safety
• Environmental Protection
• Responsible Care
• Human Resources Management
• Compliance
• Stakeholder Engagement
• Supply Chain Management

Environmental Achievements

• Reduced greenhouse gas emissions by over 40,000 tons (compared to a target of 10,000 tons)
• Achieved industrial waste minimization targets at all domestic manufacturing sites for the fifth straight year
• Maintained an average landfill rate for final industrial waste at overseas affiliates of approximately 0.4% (less than the target of 1%) for seven consecutive years
• Increased the ratio of Blue Value™ sales accounted for in Group sales from 15% to 17%

Social Achievements

• Received the Responsible Care Special Recognition Award from the Japan Chemical Industry Association
• Received the Minister of Agriculture, Forestry and Fisheries Award for Spash™ freshness retention film
• Selected as one of Thomson Reuters Top 100 Global Innovators 2015
• Increased the ratio of locally hired general managers at overseas affiliates to 45% (aiming for 60% by 2018)
• Improved the ratio of women in manager positions to 6.2%

Governance Achievements

• Increased the ratio of outside directors on the Board of Directors from two to three
• Established the Executive Compensation Advisory Committee to ensure transparency of executive compensation
• Implemented the Mitsui Chemicals Risk Management System to quickly identify and prevent risks
• Revised the Responsible Care Policy to clarify the commitment to safety

Climate Goals & Targets

Environmental Challenges

• Decreased Blue Value™ sales in fiscal 2015 due to a downturn in product sales
• Increased frequency rate of Work-related Significant Occupational Injuries (0.30, target: 0.15 or less)
• Challenges in passing down technical skills due to the retirement of experienced workers
• Securing hydrogen supplies for CO fixation technologies

Mitigation Strategies

• Implementing fundamental safety measures and a PDCA cycle
• Establishing the Plant Operation Technology Training Center to pass down technical skills
• Exploring biomass-derived hydrogen for CO fixation
• Implementing measures to change the situation of line managers' workload

Supply Chain Management

Supplier Audits: 1,647 companies surveyed in fiscal 2013

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy
• CSR procurement surveys
• Visits to suppliers to assist with improvements

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI, ISO 26000

Certifications: ISO 14001, OHSAS 18001, ISO 9001, ISO 13485, ISO 16949

Sustainable Products & Innovation

• Blue Value™ products
• Do Green™ products

Awards & Recognition

• Responsible Care Special Recognition Award
• Minister of Agriculture, Forestry and Fisheries Award
• Thomson Reuters Top 100 Global Innovators Award
• Excellence in Corporate Disclosure Award
• Internet IR Commendation Award
• Best Performance Award from Kao Purchasing Division

Environmental Metrics

ESG Focus Areas

• Climate Change
• Resource Conservation
• Safety
• Quality
• Supply Chain Management
• Human Rights
• Community Engagement
• Employee Well-being
• Governance

Environmental Achievements

• Reduced GHG emissions by 25,000 tons compared to fiscal 2015
• Reduced per-unit energy consumption by an average of over 1% per year over five years
• Achieved zero environment-related accidents at production sites
• Reduced emissions of substances subject to the PRTR Act
• Maintained an average landfill rate for final industrial waste at 1% or less for eight consecutive years

Social Achievements

• Maintained zero major accidents
• Maintained work-related significant occupational injury frequency rate below 0.15%
• Increased employee engagement through various initiatives
• Expanded sales of Rose Value™ products
• Implemented supplier sustainability assessments and improvement support

Governance Achievements

• Increased the number of Outside Directors
• Reviewed the role of Group-wide meetings and criteria for agenda items
• Established the Executive Compensation Advisory Committee and Human Resource Advisory Committee
• Implemented a robust risk management framework including Risk Hotline and Risk & Compliance Committee
• Strengthened information system security

Climate Goals & Targets

Environmental Challenges

• Maintaining high safety standards amidst changing conditions and globalization
• Supply chain disruptions
• Addressing climate change and reducing environmental impact
• Maintaining high quality standards
• Ensuring compliance with diverse global regulations

Mitigation Strategies

• Implemented fundamental safety initiatives and safety reconstruction projects
• Developed alternative sourcing strategies and supplier sustainability programs
• Implemented energy conservation measures and GHG emission reduction initiatives
• Strengthened quality management systems and customer-oriented approaches
• Established a robust compliance framework, including the Compliance Guidebook and training programs

Supply Chain Management

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy
• Sustainable Procurement SAQ
• Conflict mineral policy

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products and renewable energy technologies

Reporting Standards

Frameworks Used: GRI, ISO 26000, UN Global Compact

Certifications: ISO 14001, OHSAS 18001, ISO 9001

Sustainable Products & Innovation

• Blue Value™ products
• Rose Value™ products

Awards & Recognition

• Japan Chemical Industry Association RC Outstanding Award
• RC Merit Award from the Association of International Chemical Manufacturers
• Korea Environmental Best Award
• Excellent Enterprise of Health and Productivity Management―White 500

Environmental Metrics

ESG Focus Areas

• Climate Change
• Safety
• Resource Efficiency
• Sustainable Procurement
• Human Rights
• Quality
• Compliance
• Stakeholder Engagement
• Biodiversity

Environmental Achievements

• Reduced GHG emissions by 24.5% compared with FY 2016 (at full capacity)
• Achieved a GHG emissions reduction rate of 24.5% compared with FY 2005 (at full capacity)
• Reduced per-unit energy consumption by 0.9% compared to FY2009
• Reduced landfill disposal rate for industrial waste to 0.3% in Japan and overseas
• Reduced emissions of substances subject to the PRTR Act by 328 tons compared with FY2015

Social Achievements

• Increased ratio of women in line manager or higher positions to 3.2% (FY2018)
• Maintained zero major accidents
• Implemented various initiatives to improve employee engagement and well-being
• Conducted supplier sustainability assessments and improvement support, achieving a 39% sustainable procurement ratio (Mitsui Chemicals, Inc.)

Governance Achievements

• Established the Corporate Sustainability Division in April 2018
• Reorganized the CSR Committee as the Corporate Sustainability Committee in June 2018
• Implemented a Risk Hotline to enable reporting of risks and compliance issues
• Formulated the Mitsui Chemicals Group Policy on Bribery Prevention

Climate Goals & Targets

Environmental Challenges

• Fires at Mobara Branch Factory (FY2017) and Osaka Works (June 2018)
• High work-related significant occupational injury frequency rate (0.24 in FY2017)
• Need to increase awareness and incorporate ESG concerns into business activities
• Need to better visualize contributions to society
• Securing hydrogen supplies for CO2 fixation

Mitigation Strategies

• Review of past initiatives and earnest efforts to ensure safety
• Implementation of fundamental safety initiatives
• Safety culture diagnostics
• Risk assessments related to emergency shutdowns and non-routine operations
• Development of renewable energy components/materials
• Expansion of Blue Value™ and Rose Value™ products
• Exploration of biomass-derived hydrogen

Supply Chain Management

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy
• CSR/Sustainable Procurement SAQ
• Supplier sustainability evaluation and improvement support

Climate-Related Risks & Opportunities

Physical Risks

• Abnormal weather
• Natural disasters

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products
• Development of renewable energy components/materials

Reporting Standards

Frameworks Used: GRI, UN Global Compact, ISO 26000

Certifications: ISO 14001, OHSAS 18001, ISO 9001, ISO 50001, IATF 16949, ISO 13485, QC 080000, SMK3

Sustainable Products & Innovation

• Blue Value™ products
• Rose Value™ products

Awards & Recognition

• Dow Jones Sustainability Index inclusion
• JCIA RC Outstanding Award (Logistics Division)
• Association of International Chemical Manufacturers 2017 RC Merit Award (China)
• Green Industry Level 5 (Indonesia)
• National Safety Performance Award (Thailand)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Plastic Waste
• Safety
• Diversity & Inclusion
• Sustainable Procurement
• Quality of Products and Services
• Responsible Care

Environmental Achievements

• Reduced GHG emissions by 183,000 tons compared to FY2017 (operating at full capacity)
• Achieved a GHG emissions reduction rate of 27.2% compared with FY2005 (operating at full capacity)
• Achieved landfill rate for industrial waste of 1% or less for eight consecutive years in Japan and nine consecutive years overseas.
• Completed risk assessment for all products (two years ahead of schedule)

Social Achievements

• Established Global Human Resources Division
• Reformed Special Leave System to allow half-day increments for medical treatment and fertility treatment
• Implemented Gradual Return to Work Program
• Introduced Telework Program
• Increased ratio of women in management positions

Governance Achievements

• Established Corporate Sustainability Division
• Integrated ESG elements into budget-drafting process
• Supported TCFD recommendations
• Joined Alliance to End Plastic Waste (AEPW)
• Formulated and publicly released policies on climate change and plastic waste
• No major legal and regulatory violations in 2018

Climate Goals & Targets

Environmental Challenges

• Climate change and plastic waste problems
• Trade friction, Chinese economic slowdown, geopolitical risks
• Downturn in semiconductor market impacting industrial films sales
• Increasing number of employees requiring regular monthly hospital visits
• Shortage of truck drivers in logistics
• One major accident and eleven abnormal conditions/accidents in FY2018
• Did not achieve target for Significant Occupational Injury Frequency
• Increase in total number of customer complaints in FY2018
• Increasing rate of lifestyle-related diseases among employees
• Human rights challenges in various regions

Mitigation Strategies

• Implementing initiatives from both climate change and circular economy perspectives
• Structural reforms and other measures to improve profitability
• Strengthening operations in Taiwan and developing new products for food packaging
• Reformed Special Leave System, Gradual Return to Work Program, Telework Program
• Modal shift to rail and sea transport, shared logistics system, appointment system for trucks
• Completed investigations into causes of accidents and implemented preventive measures
• Nurturing human resources with high awareness of dangerous situations and ingraining safety culture
• Identifying fundamental causes of complaints and implementing recurrence prevention measures
• Health promotion activities, including medical examinations, health guidance, and stress reduction plans
• Conducting surveys of human rights challenges in various regions, implementing human rights due diligence, and engaging in stakeholder dialogue

Supply Chain Management

Supplier Audits: Sustainable procurement SAQ surveys and audits conducted regularly

Responsible Procurement

• Mitsui Chemicals Group Purchasing Policy
• Mitsui Chemicals Group Sustainable Procurement Guidelines
• Sustainable procurement SAQs (Self-assessment Questionnaires)

Climate-Related Risks & Opportunities

Physical Risks

• Heightened risk of wind or rain damage
• Heightened risk of rising sea levels
• Heightened risk of freshwater scarcity

Transition Risks

• Risks from introduction of carbon pricing
• Increase in litigation risks
• Restrictions on use of synthetic chemical fertilizers
• Impacts on business from shift to EVs
• Shortage of naphtha due to decline in oil production output
• Markets

Opportunities

• Uptake of renewable energies
• Uptake of biomass plastics
• Accelerated development of CCU
• Faster transition to low-GHG emissions technology and advanced recycling technology
• Increased demand for renewable energy
• Increased investor approaches

Reporting Standards

Frameworks Used: GRI, TCFD, UN Global Compact

Certifications: ISO 14001, OHSAS 18001, ISO 9001, ISO 13485, ISO 16949, ISO 50001, QC08000, SMK3, RC14001

Sustainable Products & Innovation

• Blue Value™ products
• Rose Value™ products
• Biomass plastics (ECONYKOL™, STABiO™, Do Green™)
• Bio-polypropylene (under development)

Awards & Recognition

• 2019 Awards for Excellence in Corporate Disclosure
• 2018 National Safety Performance Award (Mitsui Hygiene Materials (Thailand) Co., Ltd.)
• The Responsible Care Code of Management Practices self-assessment Award (Grand Siam Composites Co., Ltd.)
• 2019 Zero Accident Award (P.T. PETnesia Resindo)
• 2019 SCIC Responsible Care Awards (Mitsui Phenols Singapore Pte. Ltd.)
• 2018 RC Chairman’s Award (Mitsui Chemicals (China) Co., Ltd.)
• 2018 Green Industry Certificate (Advanced Composites Mexicana S.A. de C.V.)
• 2019 Health and Productivity Management Organization (White 500) (Mitsui Chemicals and Mitsui Chemicals Tohcello Inc.)
• 2018 Sports Yell Company certification
• 2018 Tokyo Metropolitan Sports Promotion Company certification
• Gold Award at the inaugural Gan-Ally Declaration Awards

Environmental Metrics

ESG Focus Areas

• Climate Change
• Circular Economy
• Plastics
• Health and Livelihood
• Highly Livable Communities
• Food Security
• Safety
• Human Rights
• Compliance

Environmental Achievements

• Reduced GHG emissions by 83,000 tons compared to the previous fiscal year (FY2019), exceeding the target of 50,000 tons. Achieved a 29% reduction in GHG emissions compared to FY2005.
• Reduced GHG emissions from Osaka Works by 70,000 tons per year through the installation of a highly efficient gas turbine power generation system.
• Achieved landfill rate for industrial waste of 0.4% in Japan and 0.3% overseas, meeting the target of 1% or less.

Social Achievements

• Zero serious occupational injuries reported.
• Significant occupational injury frequency of 0.10, below the target of 0.15.
• Launched various health promotion programs, including the Healthy Mileage Campaign, resulting in a decrease in the ratio of smokers.

Governance Achievements

• Zero major legal and regulatory violations reported.
• Implemented a robust risk management framework, including the Risk & Compliance Committee and Risk Hotline.
• Strengthened compliance training programs.

Climate Goals & Targets

Environmental Challenges

• Climate change and plastic waste.
• Supply chain disruptions due to COVID-19.
• Growing concerns over environmental pollution caused by plastic waste.
• Meeting targets for key performance indicators (KPIs) for safety and compliance.
• Insufficient implementation of growth investments.
• Improving the volatility of the Basic Materials segment.
• Insufficient progress in creating new products and businesses.
• Meeting targets for key performance indicators (KPIs) for safety and compliance.
• Globalization of business leading to diversification of people, equipment, and technology.

Mitigation Strategies

• Formulated a Climate Change Policy covering the entire global value chain.
• Developed a Carbon Neutral Strategy with targets for reducing GHG emissions and expanding Blue Value™ products.
• Developed Plastics Strategies focusing on biomass and recycling.
• Implemented initiatives to build a circular economy, including the introduction of bio-based hydrocarbons and collaboration on chemical recycling.
• Strengthened Group-wide efforts in safety and compliance through various initiatives, including compliance training and the Risk Hotline.
• Revisited the purpose of the Mitsui Chemicals Group and redefined its Corporate Target.
• Developed a Basic Strategy for VISION 2030 focusing on business model transformation and portfolio reform.
• Promoting digital transformation (DX) to accelerate research and development and improve plant maintenance.
• Revamped business portfolio to include ICT Solutions and Basic & Green Materials.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier sustainability evaluation and support for improvement.
• Sustainable Procurement Guidelines incorporating respect for human rights, fair working conditions, and environmental impact reduction.

Climate-Related Risks & Opportunities

Physical Risks

• Heightened risk of wind or rain damage (floods/storms)
• Heightened risk of rising sea levels (high tides)
• Heightened risk of freshwater scarcity
• Changes in arable land
• Wider distribution of pests, weeds, and bacteria
• Wider prevalence of infectious diseases caused by climate change
• Damage to production sites from storms and flooding

Transition Risks

• Risks from introduction of, and increases in, carbon pricing
• Increase in litigation risks
• Impacts on business from shift to EVs
• Restrictions on use of synthetic chemical fertilizers
• Shortage of naphtha due to decline in oil production output

Opportunities

• Transition to renewable raw materials
• Increasing demand for non-petrochemical products and technologies
• Increased demand for products that support disaster prevention/mitigation, and infection control
• Uptake of renewable energies
• Accelerated development of CCU technology and advanced recycling technology
• Uptake of biomass plastics
• Faster transition to low-GHG emissions technology
• Spread of circular economy
• Increased demand for renewable energy

Reporting Standards

Frameworks Used: TCFD

Certifications: ISO 14001, OHSAS 18001, ISO 9001, ISO 45001, IATF16949, ISO 50001, ISO 13485, ISO 22001, QC080000, SMK3, RC14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 12 (Responsible consumption and production)
• Goal 13 (Climate action)
• Goal 3 (Good health and well-being)
• Goal 11 (Sustainable cities and communities)
• Goal 2 (Zero hunger)

Mitsui Chemicals' initiatives contribute to these SDGs through various environmental and social programs.

Sustainable Products & Innovation

• Blue Value™ products
• Rose Value™ products
• Bio-based plastics
• Recycled plastics
• CHEMIPEARL™
• STABiO™
• ADMER™ EF Series
• Flepack ONE

Awards & Recognition

• 2020 Responsible Care Grand Prix Award
• RC Chairman’s Award (AICM)
• Award for Good Governance in Environment (Gold Star Award)
• National Safety Performance Award
• Zero Accident Award
• SCIC Responsible Care Awards
• Award for Eco-Friendly Logistics Technology
• Special Prize in the 22nd Logistics Environment Award
• Eco Rail Mark company
• White 500 companies in the 2021 Certified Health and Productivity Management Organization Recognition Program
• Sports Yell Company certification
• Tokyo Metropolitan Sports Promotion Company
• Silver certification from the Tokyo Federation of the National Federation of Health Insurance Societies
• Gold Award at the 2nd Gan-Ally Declaration Awards
• Special award from the Development Bank of Japan (DBJ)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Circular Economy
• Health and Livelihood
• Highly Livable Communities
• Food Security
• Product Design based on full life-cycle considerations
• Safety
• Human Rights
• Quality
• Sustainable Procurement
• Diversity & Inclusion

Environmental Achievements

• Reduced GHG emissions by 21% (Scopes 1 and 2) compared to FY2013
• Reduced GHG emissions by 29,000 tons through energy-saving initiatives
• Landfill rate for industrial waste at 0.4%
• Achieved a sustainable procurement ratio of 61%
• 80% of Blue Value™ and Rose Value™ certified products are positioned in highly profitable growth domains
• Approximately 1 million tons/year in avoided emissions based on Blue Value™ products sales in FY2021
• Procured 6,000 tons of bio-based hydrocarbons in FY2021
• Waste plastic recycling ratio exceeding 90%

Social Achievements

• Zero serious occupational injuries in FY2021
• Zero major accidents in FY2021
• Improved employee engagement score to 34%
• Implementation rate for improvement plans from the FY2021 survey at 100%
• Launched ESG Link Café online lessons with 1,118 participants
• Expanded the range of products and applications certified through collaboration and information sharing for Blue Value™ and Rose Value™ products
• Introduced a new performance evaluation system for recognizing efforts to take on new challenges
• Established Guidelines for Side Jobs
• Relaxed dress code

Governance Achievements

• Established the Compliance Management Committee
• Established the Circular Economy Center of Excellence (CoE)
• Restructured the CRS Committee into the Corporate Sustainability Committee
• Established new positions of chief strategy officer (CSO) and chief human resources officer (CHRO)
• Incorporated ESG elements into the basic company-wide budgeting policy
• Incorporated ESG elements into investment and financing decisions
• Improved accuracy of project screening and ability to implement post-merger integration

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to climate events
• Tightening of regulations on greenhouse gas emissions and carbon taxes
• Decreased demand for products with high environmental impact
• Shortage and depletion of water resources
• Supply chain interruptions
• Tightening of regulations on use of single-use plastics and decreased demand for plastics
• Tightening of regulations/international standards related to natural capital
• Increased risk of litigation arising from extended producer responsibility
• Reputational damage due to shift in consumer sentiment
• Uncertainty due to the VUCA era
• Growing needs for comfortable and safe lifestyles and support for pre-symptomatic illness
• Increased risk of litigation in the health care and medical sectors
• Increased need for disaster prevention measures at production sites and sophisticated risk management in business operations
• Severe water shortages
• Restrictions on business activities due to severe water shortages
• Rapid increase in product recycling
• Pressure on profits through requests from customers to share recycling costs
• Difficulty in continuing business due to disuse of additives unsuitable for recycling
• Boycott of customers’ products due to forced and/or child labor problems in subcontractors
• Boycott of products due to racial discrimination and/or human rights issues concerning workers in partner companies
• Labor-management disputes and/or severe criticism from NGOs due to unclear and/or discriminatory employment conditions for foreign workers
• Severe criticism from NGOs due to being regarded playing a role in local subcontractors’ invasion of residential area for the indigenous population
• Strikes or plant operation cessation following labor union formation and/or refusal of collective bargaining in local country
• Health damage from worsened labor conditions in production sites
• Accidents or death from overworking of employees in subcontractors due to excessive long-hour working
• Labor disputes and/or severe criticism from NGOs due to failure to pay minimum wage or living wage
• Severe criticism from NGOs for taking a part in inhuman acts through purchasing conflict minerals
• Severe criticism from NGOs of a specific material or chemicals and plastics in general
• Influence on business from tightening or changes to laws and regulations in response to rise in critical public opinion
• Customers pulling out from business due to rise in critical public opinion and/or severe criticism
• Plant operation cessation due to territorial disputes or terrorism
• Stagnation or uncertainty of Mexican economy due to lack of progress in NAFTA negotiations
• Steep rise in raw oil prices or procurement difficulties due to worsened Middle East situation
• Difficulty in business continuation through withdrawal of investment due to trading with sanctioned countries
• Loss of social credibility through bribery of local civil servant by local consultant
• Collapse of share in the materials market through entrance of competitors
• Shortfall in meeting operating profit target due to rise in material prices and/or fluctuations in exchange rates
• Poor spread and revenue declining due to slow recovery of the market
• Sales decrease and decline in the market due to increase of imports, and increase of stock caused by falling sales
• Significant deterioration in business due to reduced demand caused by changes in social climate
• Influence on the business continuity by infectious diseases
• Violations of antitrust regulations
• Contract-related problems and complaints
• Non-compliance with intellectual property regulations
• Violation of laws
• Violation of tax laws regarding accounting procedures, or inadequate procedures
• Occurrence of serious accidents
• Occurrence of serious occupational accidents
• Non-compliance with laws related to the environment and occupational health and safety
• Loss of social credibility through accidents or problems
• Inadequate management of high risk goods
• Occurrence and increase in complaints
• Occurrence of serious quality problems
• Loss of social credibility through quality falsification
• Production volume reduction due to problems in plants
• Production problems accompanying increase in operating efficiency
• Occurrence of serious problems in using external facilities
• Occurrence of uncollectible debts
• Increase in mental health problems
• Occurrence and unsettled harassment issues
• Inadequate management of M&A-related internal information
• Leakage of confidential information and/or private information
• Leakage of customer information
• Unaddressed information system security risks
• Leakage of insider information
• Cessation of plants that are not compliant with environmental laws and regulations
• Cessation of material procurement and loss of customers accompanied by tightening of environmental laws and regulations
• Increase in subcontract expenses to comply with environmental laws and regulations
• Cessation of plant operation caused by natural disasters (heavy rain, flooding, powerful typhoons, etc.)
• General price rise due to energy shift as an anti-climate change measure and cost increase due to tax reforms in the subcontractors’ countries
• Severe criticism from NGOs etc. due to participation in deforestation for oil palm plantations through palm oil usage
• Backlash from communities due to inadequate control over air, water, and soil pollution, as well as waste emissions (possibly including violation of laws), which may lead to inability to continue plant operations
• Cessation of plant operation caused by natural disasters (earthquakes, tsunamis, etc.)
• Purchase of high-priced materials as a result of environmental procurement based on customers’ policies
• Inability to procure materials due to decrease in by-product materials through suppliers shift to green production
• Cessation of plant operations due to outages of electricity, water, etc. through physical or political reasons
• Market shrinkage due to rapid increase in product recycling
• Chronic labor shortages in the logistics industry
• Lack of experienced personnel in the field of safety and quality in logistics
• Lack of skill transfer in logistics

Mitigation Strategies

• Developed alternative sourcing strategies
• Implementing various measures, including saving energy in the manufacturing process, actively utilizing renewable energy, and switching to low-carbon raw materials and fuels
• Expanding Blue Value™ products
• Refining technologies for plastic waste chemical and mechanical recycling, as well as mono-material production of packaging
• Evaluating risks according to the region and taking measures to minimize physical and human risks
• Expanding lineup of adaptable products
• Formulated climate change policies on mitigation and adaptation
• Established the Mitsui Chemicals, Inc. – Carbon Neutral Research Center
• Developing fuel conversion technology for naphtha crackers
• Actively working with other companies to establish mechanical and chemical recycling technologies
• Established the Green Sustainable Chemicals Division
• Expanding the use of bio-based hydrocarbons
• Promoting our initiatives to reduce our own GHG emissions and helping reduce carbon emissions across the value chain through our products and services
• Developing and acquiring fundamental technologies that help achieve carbon neutrality
• Promoting low-carbon products by switching to raw fuel
• Providing products and services for a resilient society, including for disaster prevention and mitigation
• Introducing bio-based hydrocarbons produced by Neste Corporation
• Producing and marketing renewable chemicals and bio-polypropylene
• Obtaining ISCC PLUS certification
• Working on the joint development of chemical recycling technology using microwaves
• Participating in global alliances such as the Alliance to End Plastic Waste (AEPW)
• Participating in the Japan Clean Ocean Material Alliance (CLOMA)
• Participating in the Japan Initiative for Marine Environment (JaIME)
• Joined the Taskforce on Nature-related Financial Disclosures (TNFD) Forum
• Incorporated the carbon neutral strategy into VISION 2030
• Established the Circular Economy CoE
• Promoting low-carbon raw materials and fuels and energy efficiency
• Pushing forward with introducing renewable energy
• Implementing a management approach that integrates financial and non-financial perspectives
• Established a system to incorporate ESG elements and perspectives on social challenges when making decisions on major investment and financing cases
• Including estimates calculated based on ICP in the investment planning form
• Adding ICP-based IRRs (c-IRR) as a reference for investment/financing evaluation
• Holding ESG Link Café one-point lessons
• Holding workshops for workplaces and departments
• Formulated Action Guidelines
• Established the Compliance Management Committee
• Established the Risk & Compliance Committee
• Deploying the Mitsui Chemicals Global Policy Platform (M-GRIP)
• Established a global policy on information system security
• Strengthening our group-wide information management framework globally
• Reinforcing our efforts to address the important issue of managing the growing risk from cyberattacks
• Building a security operation center (SOC)
• Systematization of company rules and other rules on information system security
• Training and education on security risks for Group employees
• Implementing various safety activities
• Introducing a series of fundamental safety measures
• Expanding to include non-routine operations at Works
• Conducting non-routine risk assessments
• Introducing the HAZOP/LOPA procedure
• Holding training sessions for manufacturing workplace staff
• Implementing KY education
• Providing training support on KY and Pointing-and-Calling
• Sharing information on workers’ narrowly avoided major accidents or disasters
• Implementing measures, such as providing a space for dialogues between Works and the Head Office directors and corporate auditors
• Strengthening construction management and internal audit
• Enhancing line manager training programs
• Developing appropriate maintenance plans
• Reinforcing change management (risk assessment)
• Improving the quality of construction
• Providing a space for dialogues between Works and the Head Office directors and corporate auditors
• Strengthening construction management and internal audit
• Enhancing line manager training programs
• Conducting regular meetings with each site
• Implementing the operation of the electronic manifest
• Improving manufacturing processes and monitoring the waste disposal status at outsourcing companies
• Recycling low-polymer and other waste materials
• Checking the disposal status of industrial waste
• Using various methods to reduce VOC emissions into the air
• Implementing a variety of measures to reduce release of SOx, NOx, and soot and dust into the atmosphere
• Developing an investment and loan plan to renovate our facilities to achieve the target of reducing annual PRTR emissions to 450 tons or less
• Reviewing and improving the process of recovering and treating exhaust gases
• Managing efficient water usage and water preservation
• Asking suppliers to carry out activities that include waste water management and efficient utilization of water
• Collecting wastewater from different plants before it is treated
• Passing wastewater though an activated sludge process
• Treating wastewater with ozone, combustion, or anammox
• Using the AQUEDUCT Water Risk Atlas of World Resources International (WRI)
• Using the Water Risk Filter of the World Wildlife Fund (WWF)
• Conducting assessments on the physical risks to our production sites
• Developing products and services that help reduce environmental burdens
• Setting Blue Value™ products sales revenue ratio as a KPI in VISION 2030
• Focusing attention on biodiversity related social challenges
• Requesting our suppliers to support the preservation of biodiversity
• Undertaking modal shifts and shared logistics
• Providing product safety information
• Supporting the aims of the Taskforce on Nature-related Financial Disclosures (TNFD)
• Participating in the TNFD Forum
• Supporting the Declaration of Biodiversity by the Japan Business Federation (Keidanren)
• Participating in the Japan Business and Biodiversity Partnership
• Engaging in ongoing activities to preserve the protected forest at the Omuta Works
• Donating to the Japan Environmental Action Network (JEAN)
• Conducting regular meetings with members of local communities
• Opening our Risk Hotline
• Compiling and publishing environmental accounts
• Collecting chemical information from suppliers
• Assessing the risks concerning our products
• Maintaining mutual communications with customers on any hazards in our products and how to handle them safely
• Conducting qualitative assessment using the Control Banding Method
• Conducting quantitative assessment using tools such as ECETOC TRA
• Undertaking risk communications with customers
• Considering risk reduction through improving the compositions or development of alternative products
• Formulating response measures for newly enforced or revised laws and regulations
• Working together with raw materials manufacturers, our internal supply chain, and suppliers
• Registering the pre-notified chemicals by the deadlines specified
• Using the Mitsui Chemicals Safety Information System (MiCSIS)
• Requesting raw material suppliers to submit the latest SDSs, chemSHERPA, and Regulatory Survey Report
• Utilizing an AI solution to support surveys on information related to chemical compliance
• Conducting highly effective quality audits
• Enhancing the human resource development programs
• Implementing quality training plans for each organizational level
• Implementing measures to recognize the importance of observing quality compliance
• Implementing frontline measures to prevent quality issues on the shop floor (QRG activities)
• Implementing these measures in our subsidiaries and affiliates
• Working with partners in the logistics area to improve the working environment
• Building a resilient logistics system
• Promoting automation and streamlining by using DX technology
• Strengthening activities in the environmental and safety aspects
• Providing our logistics contractors a Safety Data Sheet (SDS)
• Submitting a Yellow Card
• Developing and installing a function that automatically outputs the information needed for a Yellow Card
• Developing equipment to safely extract products from a vehicle
• Deploying a portable abatement system
• Providing group education to logistics contractors
• Introducing the use of portable terminals
• Printing QR codes on labels
• Organizing a mutual emergency support system
• Stocking emergency response equipment and materials
• Convening the Mitsui Chemicals Group Logistics Emergency Network (MENET)
• Improving the operation of VR training
• Establishing a new training system of loaning equipment to the Company’s Works
• Providing training programs in Thai and English
• Providing web training programs
• Providing training in local languages
• Providing courses that adopted thorough infection prevention measures

Supply Chain Management

Supplier Audits: Sustainable Procurement Survey (SAQ21)

Responsible Procurement

• Supplier sustainability evaluation and support for improvement
• Sustainable Procurement Guidelines
• Requesting suppliers to support the preservation of biodiversity
• Checking the disposal status of industrial waste
• Requesting raw material suppliers to submit the latest SDSs, chemSHERPA, and Regulatory Survey Report

Climate-Related Risks & Opportunities

Physical Risks

• Heightened risk of wind or rain damage (floods/storms)
• Heightened risk of rising sea levels (high tides)
• Heightened risk of freshwater scarcity
• Changes in arable land
• Wider distribution of pests, weeds, and bacteria
• Wider prevalence of infectious diseases caused by climate change
• Damage to production sites from storms and flooding

Transition Risks

• Risks from introduction of, and increases in, carbon pricing
• Increase in litigation risks
• Impacts on business from shift to EVs
• Restrictions on use of synthetic chemical fertilizers
• Shortage of naphtha due to decline in oil production output
• Increased raw materials costs due to decreased naphtha production volume
• Declining valuation and reduced opportunities to secure investment due to insufficient response to demands by customers and investors to reduce GHG emissions

Opportunities

• Increased demand for low-carbon and decarbonized products and technologies
• Increased demand for products that support disaster prevention/mitigation, infection control, etc.
• Transition to renewable raw materials
• Uptake of renewable energies
• Accelerated development of CCU technology and advanced recycling technology
• Uptake of biomass plastics
• Faster transition to low-GHG emissions technology
• Spread of circular economy
• Calls for manufacturers to use renewable energy
• Increased demand for renewable energy
• Creation of new business opportunities by introducing the recycling (mechanical and chemical recycling) and CCUS technology
• Increasing corporate value and growing opportunities to secure investment due to proactive disclosure of information about how we are addressing climate change

Reporting Standards

Frameworks Used: TCFD, GRI, UNGC

Certifications: ISO 14001, ISO 45001, ISO 9001, IATF16949, ISO 13485, ISO 17025, ISCC PLUS, QC080000, SMK3, ISO 22001

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 12 (Responsible consumption and production)
• Goal 13 (Climate action)
• Goal 3 (Good health and well-being)
• Goal 11 (Sustainable cities and communities)
• Goal 2 (Zero hunger)
• Goal 8 (Decent work and economic growth)
• Goal 9 (Industry, innovation and infrastructure)

The Group's initiatives contribute to these goals through various activities such as reducing GHG emissions, promoting a circular economy, developing sustainable products, improving employee well-being, and engaging in community development.

Sustainable Products & Innovation

• Blue Value™ products
• Rose Value™ products
• Bio-based chemicals and plastics
• NAGORI™

Awards & Recognition

• 2021 Responsible Care Grand Prix Award
• RC Chairman’s Award
• National Awards for outstanding in workplace safety, occupational health and environment management
• National Safety Performance Award
• Zero Accident Award
• SCIC Responsible Care Awards
• Good Design Best 100

Environmental Metrics

ESG Focus Areas

• Climate Change
• Circular Economy
• Health and Livelihood
• Highly Livable Communities
• Food Security
• Product Design based on full life-cycle considerations
• Safety
• Respect for Human Rights
• Risk and Compliance Management
• Product Quality
• Stable Production
• Corporate Culture
• Human Capital
• Diversity
• Digital Transformation
• Partnerships

Environmental Achievements

• Reduced GHG emissions (Scopes 1 and 2) by 27% compared to FY2013.
• Achieved a landfill rate for industrial waste of 0.28%.
• Reduced VOC emissions to 1,473 tons.
• Achieved a 95.8% recycling rate for waste plastics.

Social Achievements

• Implemented human rights due diligence.
• Revised and announced Human Rights Policy.
• Improved employee engagement (100% implementation rate for improvement plans from the FY2021 survey).
• Increased successor coverage rate for critical positions to 211%.

Governance Achievements

• Renewed risk management system.
• Incorporated non-financial KPIs into executive compensation formulas.
• Established a Global Policy on Anti-Bribery.
• Revised rules for managing business entertainment and gifts, establishing the new “Bribery Prevention Regulation”.

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to various factors (e.g., slow recovery in the Chinese market, semiconductor shortage, increased raw material and fuel prices).
• GHG emissions from naphtha crackers.
• Marine plastic waste.
• Ensuring human rights throughout the complex supply chain.
• Maintaining compliance in a diversifying business environment.
• Maintaining cost competitiveness and stable production amidst various challenges (e.g., shrinking workforce, aging facilities, rising raw material prices, frequent natural disasters).

Mitigation Strategies

• Developing a value chain including a shift to bio-based raw materials and fuels, chemical and mechanical recycling, and other measures.
• Collaborating with other companies to shift to green chemicals and secure bio-based raw materials and clean ammonia.
• Participating in global and Japanese alliances (e.g., AEPW, CLOMA).
• Focusing on investigating the actual conditions of important suppliers.
• Establishing a new company-wide risk management system and a group and global compliance system.
• Passing on technologies and skills, improving productivity, and introducing advanced technologies.

Supply Chain Management

Responsible Procurement

• Sustainable Procurement Guidelines
• Supplier sustainability evaluation and support for improvement

Climate-Related Risks & Opportunities

Physical Risks

• Storms, flooding, droughts

Transition Risks

• Tightening of regulations on GHG emissions, carbon taxes, transition to renewable raw materials

Opportunities

• Increased demand for low-carbon products and technologies, opportunities for solutions business

Reporting Standards

Frameworks Used: TCFD

Certifications: ISO 14001, ISO 45001, ISO 9001, IATF16949, ISO 17025, ISO 13485, ISO 22001, QC080000, SS506, SS651, ISCC PLUS

Sustainable Products & Innovation

• Blue Value™ products
• Rose Value™ products
• BePLAYER™ products (biomass-based)
• RePLAYER™ products (recycled)

Awards & Recognition

• Various awards for safety, environmental protection, and occupational health and safety at affiliates.

Environmental Metrics

ESG Focus Areas

• Climate change
• Circular economy
• Health and livelihood
• Highly livable communities
• Food security
• Respect for human rights
• Safety
• Compliance
• Product quality
• Stable production
• Corporate culture
• Human capital
• Innovation
• Digital transformation

Environmental Achievements

• Overhauled risk management system to minimize threats and maximize opportunities related to climate change and circular economy.
• Further refinement and implementation of the rules for Blue Value™ & Rose Value™ certification and operation
• Establishment and pursuit of indicators & targets concerning recycling/biomass strategies

Social Achievements

• Improved engagement to bolster organizational strength and transform corporate culture
• Increased number of executive officers with diverse backgrounds (women, non-Japanese, mid-career hires)
• Increased ratio of women in management positions

Governance Achievements

• Overhauled risk management system to minimize threats and maximize opportunities related to compliance risks.
• Accelerating shift to an investor/shareholder perspective, including fundamental changes to the compensation system
• Improved the effectiveness of management supervision

Climate Goals & Targets

Environmental Challenges

• Business continuity risks (major disasters/accidents, geopolitical risks, infectious diseases, cyberattacks, supply chain disruptions)
• Climate change risks
• Growing demand concerning social challenges (climate change, creating a recycling-oriented society)

Mitigation Strategies

• Updating BCP, procurement of supplies from multiple sources, mutual use of global sites, diversification of distribution routes, enhancement of disaster resilience, maintenance of appropriate inventory, updating of cyberattack recovery plan, formulation of response measures for subcontractor disasters, updating BCP scenarios, regular information sharing with regional headquarters, response to vulnerabilities based on IT system security checks, apprehension of global trends and information concerning laws & regulations, enhancement of internal information-sharing frameworks, further refinement and implementation of rules for Blue Value™ & Rose Value™ certification and operation, establishment and pursuit of indicators & targets concerning recycling/biomass strategies

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• Blue Value™ products
• Rose Value™ products