Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Renewable Energy
• Green Buildings

Environmental Achievements

• Not disclosed

Social Achievements

• Not disclosed

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Impact of large-scale infrastructure development projects on ecosystems, water pollution, noise, and negative impacts on neighboring residents.

Mitigation Strategies

• Set selection and exclusionary criteria for renewable energy projects; committed to reviewing compliance with the Act and ordinances related to environmental impact assessment; assessing environmental impacts using key indicators; holding briefing/reporting sessions for local residents; avoiding project finance for coal-fired power plants in principle; monitoring and disclosing the percentage of carbon-related assets in loans.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Sustainable feedstock and/or wastes for biomass power generation (wastes from palm oil businesses limited to those with RSPO or RSB certifications)

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Green Bond Principles 2018 (GBP), Japan’s Green Bond Guidelines 2020

Certifications: Null

Third-party Assurance: Sustainalytics

UN Sustainable Development Goals

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

Renewable energy projects contribute to SDG 7; green building projects contribute to SDG 9.

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• climate change
• human rights
• promoting industrial transition

Environmental Achievements

• Not disclosed

Social Achievements

• Not disclosed

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Not disclosed

Mitigation Strategies

• Not disclosed

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

Environmental Metrics

ESG Focus Areas

• Climate Change
• Human Rights
• Industrial Transition
• Social Contribution

Environmental Achievements

• Reduced environmental burden through resource and energy saving, waste reduction, and green procurement initiatives.
• Supported customers' efforts to address environmental issues, including their transition to a low-carbon and decarbonized society, by providing products and services that contribute to environmental solutions.

Social Achievements

• Implemented various efforts to leverage the Group’s competencies and effectively use expertise and know-how to solve management issues faced by customers, including SMEs, and to revitalize local communities.
• Established “Startup Ecosystem Support Framework” offering one-stop support services to startups.
• Established “Solution Management Office” to provide professional consulting services for business succession issues.
• Formed alliances with regional financial institutions to provide solutions to their clients.

Governance Achievements

• Defined a procedure to manage insider information learned in the course of duty and strictly manages such information.
• Developed Internal Rules (Security Policy) to safely manage personal information and prevent unauthorized access.
• Established a whistle-blower system called “Aozora Hotline Program”.

Climate Goals & Targets

Environmental Challenges

• Negative impacts of borrowers and investees’ business activities on the environment and society.
• Negative impacts of suppliers' business activities on human rights and the environment.
• Liquidity risk in the event the market environment becomes unstable.
• Deteriorating environment of the U.S. real estate market impacting overseas real estate non-recourse loans.

Mitigation Strategies

• Strive to improve issues through dialogue with customers whose businesses may have a negative impact on the environment and society, and works to reduce environmental and social risks by restricting or prohibiting credit when no improvement can be made.
• Communicate closely with suppliers in consideration of environmental and human rights issues.
• Holds sufficient level of assets such as cash deposits and securities with high liquidity to properly meet its contractual obligations.
• Conducting simulations assuming scenarios where our funding is hindered, confirming the availability of sufficient cash on hand and collateral necessary for settlements to maintain our asset size, and conducting training to review the steps for response measures.
• From the year ended March 31, 2024, for all borrowers of overseas real estate non-recourse loans that require careful monitoring in the future, the loan loss amount mainly estimated by the DCF method is reflected as an addition to the allowance for loan losses determined based on the estimated loan loss ratio.

Supply Chain Management

Responsible Procurement

• Aozora Bank Group Outsourcing Policy

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD