Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Renamed "Solar Power Related Business" segment to "Environmental Related Business" to reflect a shift from solar power development to broader environmental solutions, including carbon-free solutions for RE100, SDGs, and ESG investments.
• Jointly developed an ultralightweight mounting system ("Esnon Hall") for solar panels with Toyo Aluminum Co., Ltd. for installation on factory and building rooftops.

Social Achievements

• Renewal of the Ashikaga factory to improve productivity and create a work environment that avoids excessive overtime for employees.
• Active engagement in overseas markets, particularly Southeast Asia, collaborating with domestic feed companies and food trading companies to secure overseas plant orders and machinery sales.

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Rising material costs, particularly steel.
• Delays in contract signings for large-scale solar power projects, resulting in revenue shifting to later quarters.
• Geopolitical risks in East Asia (North Korea's denuclearization, deteriorating Japan-South Korea relations), and the worsening US-Iran relationship impacting the Japanese economy.

Mitigation Strategies

• Strengthened information gathering and cost management to mitigate rising material costs.
• Implementing rigorous cost and process management.
• Utilizing AI and IoT technologies for technology transfer.
• Focusing on securing plant projects related to large-scale feed plants and related machinery and equipment.
• Active engagement in overseas markets, particularly Southeast Asia, collaborating with domestic feed companies and food trading companies to secure overseas plant orders and machinery sales.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: 監査法人元和

UN Sustainable Development Goals

• SDG 7 (Affordable and Clean Energy)
• SDG 9 (Industry, Innovation and Infrastructure)
• SDG 13 (Climate Action)

The company's initiatives in renewable energy solutions and carbon-free technologies contribute to these goals.

Sustainable Products & Innovation

• Esnon Hall (ultralightweight mounting system for solar panels)

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• SDGs
• ESG

Environmental Achievements

• Withdrawal from environmental-related business (as announced in March 31, 2022 press release)
• Introduction of photocatalytic titanium oxide coating agent for food-related clients, contributing to food safety and hygiene.

Social Achievements

• Strengthening relationships with subcontractors and cooperative association member companies to secure and expand order backlog (addressing aging workforce and labor shortages)
• Implementation of IoT functions on machinery for improved visibility of operating status and labor-saving needs.

Governance Achievements

• Establishment of a compliance system through internal control, with the audit committee playing a central role.
• Implementation of a whistleblower system and regular compliance training for all employees.

Climate Goals & Targets

Environmental Challenges

• Uncertainty in the economic outlook due to prolonged high resource and raw material prices, global inflation, and fluctuations in interest rates, exchange rates, and stock prices.
• Decreased profitability in the Chinese subsidiary due to the zero-COVID policy and low customer equipment investment.
• Aging workforce and labor shortages.

Mitigation Strategies

• Strengthening information gathering and proposal capabilities in response to changes in the environment, such as restructuring and factory mergers and acquisitions by major customers.
• Organizational restructuring to enhance construction risk management.
• Strengthening relationships with subcontractors and cooperative association member companies to secure and expand order backlog.
• Improving manufacturing efficiency and productivity.
• Developing machinery with IoT functions and labor-saving features.

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• Photocatalytic products

Environmental Metrics

ESG Focus Areas

• CO2 emissions reduction
• Contribution to sustainable food and agricultural industries using new businesses and IoT
• Support for successors and leaders of business partners
• Compliance
• SDGs

Environmental Achievements

• Not disclosed

Social Achievements

• Not disclosed

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Establishing and improving profit base
• Exploring and considering entry into growth business areas
• Strengthening financial structure
• Transformation into a company with a sense of fulfillment

Mitigation Strategies

• Review and implementation of business strategies and methods to further utilize strengths such as customer base, network of bases, and one-stop provision of plants and machinery
• Strengthening sales to a wide range of food-related companies, diversifying customer portfolios and revenue sources
• Strengthening collaboration with the Abalance Group to meet a wide range of customer needs, including decarbonization and hygiene enhancement, and differentiating from competitors
• Improving operating rates, refining machine and plant design, expanding subcontractors, and renewing aging equipment to improve productivity and efficiency of machine manufacturing and plant engineering businesses and strengthen cost competitiveness
• Strengthening R&D capabilities for new products and fields based on customer needs such as labor saving and labor saving
• Strengthening profitability of local subsidiaries through domestic and international collaboration, exploring opportunities for machinery and plant orders in Southeast Asian markets, and strengthening global procurement through partnerships
• Considering entry into new businesses in collaboration with the Abalance Group and external partners, considering initiatives for the sixth industrialization focused on food and agriculture
• Expanding business areas through M&A
• Appropriate and flexible use of interest-bearing liabilities in consideration of funding needs for new businesses and capital investment
• Building a system that provides a sense of satisfaction and fairness through corporate culture reform and personnel system reform
• Securing a thick layer of engineering personnel such as technology and design, and establishing a system for systematic transmission of technology and know-how
• Creating a system to hone and draw out the abilities and knowledge of individual officers and employees, and expanding communication opportunities to enable them to demonstrate value creation

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed