Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Energy consumption per unit of production in Japan was down 2.4% from fiscal year 2014, owing to the implementation of 493 energy-saving initiatives.
• Fossil fuel use by domestic Group companies declined 12,524 kl, equivalent to 11.5% of total energy used, thanks to the expanded use of energy from renewable sources.
• Installed a gas turbine-powered cogeneration system with a capacity of 1,700 kW at the Kashima Plant.

Social Achievements

• Siam Chemical Industry Co., Ltd. was presented with a CSR-DIW Award for 2015 by the Thai Ministry of Industry, the fourth consecutive year it has been so honored.
• DIC was selected for inclusion in the Dow Jones Sustainability Indices Asia Pacific Index.

Governance Achievements

• Instituted an executive officer system to separate decision-making and implementation.
• Appointed two highly independent outside individuals to its Board of Directors.
• Established a Nomination Committee and a Remuneration Committee.

Climate Goals & Targets

Environmental Challenges

• Operating income shortfall compared to DIC105 target.
• Need to restructure businesses framework in mature markets.
• Need to create and cultivate next-generation businesses.

Mitigation Strategies

• Implementing DIC108 medium-term management plan with four business initiatives: expand growth-driving businesses; pursue strategic investments; rationalize operations in mature markets; and create next-generation businesses.
• Focusing management resources on high-performance materials.
• Budgeting ¥150.0 billion for strategic investments, including M&As, over three years.

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• Offset ink that dries at low temperatures
• High-sensitivity UV-curable ink
• Sheetfed ink containing an anti-setoff agent
• Water-based flexo ink that does not contain bisphenol A
• Base ink system for low-migration inks
• New green pigment for wide-color gamut color filters
• N-type LC materials for FFS mode
• Innovative epoxy curing agent
• Highly heat-resistant novolac resin
• Fluorosurfactant
• Environment-friendly nonhalogenated epoxy resins
• Self-healing acrylic coating resin
• Double-coated tapes incorporating high-performance waterborne adhesives
• Film for food packaging applications

Awards & Recognition

• CSR-DIW Award (Siam Chemical Industry Co., Ltd.)

Environmental Metrics

ESG Focus Areas

• Reduction of CO2 emissions
• Circular economy
• Safety
• Talent management
• Sustainable procurement

Environmental Achievements

• Reduced CO2 emissions by 23.6% from the fiscal year 2013 level by fiscal year 2020.
• Implemented renewable energy initiatives at various plants (solar power, biomass boiler).

Social Achievements

• Developed a DIC Sustainability Index to measure the social value of products.
• Focused on talent management, aiming to foster global talent and improve the global management organization.

Governance Achievements

• Established an ESG Unit and Sustainability Committee.
• Supports TCFD and engages in sustainable procurement initiatives.

Climate Goals & Targets

Environmental Challenges

• Reducing CO2 emissions to achieve carbon neutrality by 2050.
• Promoting a circular economy and reducing waste.
• Ensuring safe working conditions globally.

Mitigation Strategies

• Setting a target to reduce CO2 emissions by 50% from the 2013 level by 2030 and achieve carbon neutrality by 2050.
• Developing sustainable products and promoting chemical recycling.
• Implementing global safety initiatives and setting targets for TRIR.

Supply Chain Management

Supplier Audits: Using EcoVadis (third-party platform) for Europe and the Americas, and surveys for Japan and Asia.

Responsible Procurement

• DIC Group Sustainable Procurement Guidelines focusing on compliance, human rights, environment, information security, quality, and sustainability.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD

Sustainable Products & Innovation

• Biomass inks and adhesives
• NIR-reflective inorganic black pigment
• PPS compounds for lightweight automotive components
• Low-dielectric maleimide resins for electronics

Environmental Metrics

ESG Focus Areas

• Climate Change
• Human Capital and Diversity

Environmental Achievements

• Aim to achieve carbon neutrality—net zero CO2 emissions—by fiscal year 2050 and will seek to reduce CO2 emissions by 50% from the fiscal year 2013 level by fiscal year 2030.

Social Achievements

• Launched Work Style Revolution (WSR) 2020, a project to develop new work styles with the aim of boosting job satisfaction and productivity through job satisfaction improvement reforms, workplace reforms and process reforms, thereby creating positive workplace environments that ensure psychological safety and help employees grow and realize their full potential.
• Percentage of female employees in management positions of the Group was 14.9% (calculation excludes certain group companies).

Governance Achievements

• Established the Sustainability Committee, which answers directly to the President and CEO and is responsible for formulating responses to key social imperatives.
• Established the Risk Management Working Group, a subordinate entity of the Sustainability Committee, as part of its effort to strengthen its comprehensive risk management framework.

Climate Goals & Targets

Environmental Challenges

• Portfolio transformation delayed, ossification causing slowing of growth or product life cycles pushing down profitability of mature businesses.
• Failure of acquisitions and capital alliances to proceed as expected.
• Political and geopolitical changes causing cost increases, restrictions on product and/or raw materials imports and exports, suspension of monetary remittances, or supply chain interruptions.
• Large-scale disasters or accidents causing casualties or property damage, leading to suspension of plant operations and/or business activities.
• Stagnation of innovation resulting in inability to develop and launch products that respond to social imperatives.
• Inadequate response to climate change–related operating environment and ESH-related changes.
• Demands for reduction of environmental impact.
• Compliance violations.
• Inability to secure and retain diverse individuals necessary to the management and execution of its businesses.
• Interest rate fluctuations.
• Exchange rate fluctuations.
• Product quality issues.
• Inability to secure a sustainable supply chain for raw materials.
• Information security issues.
• Inadequate corporate governance.
• Intellectual property disputes.
• Water resource shortages and/or deterioration of water quality at supply sources.
• Tax-related risks.
• Pandemic-related risks.

Mitigation Strategies

• Concentrating management resources on business development themes that can be expected to yield swift and consistent profits and promoting the efficient allocation of management resources.
• Basing investment decisions on proprietary investment indicators, as well as by thorough in-house investigations and due diligence conducted in collaboration with external organizations, to identify and address risk factors in advance.
• Promoting groupwide post-merger integration initiatives and implementing actions aimed at realizing synergies.
• Formulating BCPs for individual product divisions.
• Promoting exhaustive efforts to prevent accidents and disasters at its sites.
• Leveraging existing basic technologies, as well as new basic technologies in the areas of inorganic materials design and biomaterials design, to develop sustainable products.
• Promoting open innovation, including through participation in a quantum computer–related consortium, to secure cutting-edge digital technologies.
• Reducing CO2 emissions through aggressive environmental investments and energy conservation measures.
• Formulating a road map to realize the goals set forth in DIC NET ZERO 2050.
• Compelling suppliers to advance sustainability initiatives, including reducing their environmental impact and respecting human rights.
• Promoting multiple company purchasing, entering into supply contracts and seeking alternative materials, with the aim of reducing both raw materials costs and procurement–related risks.
• Strengthening the security functions of its information control infrastructure, improving BCPs, and upgrading and providing information security training.
• Establishing the DIC Group Code of Business Conduct as a set of compliance standards to be observed when conducting business.
• Improving employee engagement, promoting diversity, introducing a multitrack personnel system, enhancing career support systems, strengthening talent management, expanding human resources development systems, improving support for mental health, formulating global succession and relocation plans, and implementing work style reform measures to realize flexible work arrangements.
• Maintaining/strengthening its financial position and reducing interest-bearing debt.
• Increasing the procurement of funds at fixed rates, while closely monitoring interest rate trends around the world.
• Establishing regional foreign exchange risk management systems and working to better grasp the impact of foreign currency fluctuations in foreign exchange rates on its business performance and on overseas subsidiaries’ foreign currency–denominated transactions.
• Using foreign currency forward contracts and other hedging instruments, as well as multicurrency financing and investments.
• Building and expanding its quality control configuration, with the Quality Committee, which answers directly to the president.
• Formulating BCPs that include measures to ensure supplies of key raw materials and address extreme physical risks, as well as strengthening countermeasures against climate–related disasters for sites located in coastal areas.
• Collecting highly accurate information and sharing information Groupwide, positioning it to respond to high–level disclosure requests in a timely and appropriate manner without being seen as greenwashing.

Supply Chain Management

Responsible Procurement

• Compelling suppliers to advance sustainability initiatives, including reducing their environmental impact and respecting human rights.

Climate-Related Risks & Opportunities

Physical Risks

• Climate-related disasters arising from the increasing seriousness or frequency of extreme weather events

Transition Risks

• Carbon pricing or carbon border taxes
• Sudden changes in demand resulting from the shift to a circular economy

Sustainable Products & Innovation

• Biomass packages
• High-speed communications–compatible materials
• Functional inorganic materials
• High-performance nutrition
• Environment-friendly waterborne polyurethane resin
• Environment-friendly perfluoroalkyl and polyfluoroalkyl substance (PFAS)-free products
• Algae oil–based sulfurized products
• Toluene-free tapes