Climate Change Data

Environmental Metrics

ESG Focus Areas

• Corporate Social Responsibility (CSR)
• Corporate Governance
• Environmental Protection
• Community Involvement
• Ethical Business Practices
• Customer Focus
• Corporate Culture

Environmental Achievements

• Participation in Kanagawa Water-Source Forest Creation Project
• Incorporation of environmental considerations into the entire product life cycle

Social Achievements

• Established NEC Electronics Guiding Principles to promote management guidelines for CSR
• Family-friendly workplace initiatives
• Electronic industrial arts class for local elementary school students
• CSR Guidelines issued for purchasing partners
• Regular top executive meetings with sales partner companies

Governance Achievements

• Adopted the corporate auditor system
• Introduced the Corporate Officer System
• Established a Corporate Social Responsibility Promotion Committee
• Adopted NEC Electronics Guiding Principles and NEC Electronics Group Code of Conduct

Climate Goals & Targets

Environmental Challenges

• Growth in the semiconductor market began to taper off
• Price declines for main products due to intensified competitive pressures
• Increased R&D expenses
• One-time expenses for structural reforms
• Sharp falls in LCD driver IC prices

Mitigation Strategies

• New management policy with measures for achieving a recovery in business performance (improving R&D efficiency, increasing sales by concentrating product development resources, lowering manufacturing costs, restructuring the organization)
• Cutting fixed costs by ¥20 billion
• Streamlining product lines and executing a more product-centered manufacturing operation
• Constructing manufacturing process lines dedicated to LCD drivers

Supply Chain Management

Responsible Procurement

• CSR Guidelines for purchasing partners

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• Eco-products incorporating environmental considerations

Environmental Metrics

ESG Focus Areas

• Not disclosed

Environmental Achievements

• Not disclosed

Social Achievements

• Not disclosed

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Rapid rise of the yen impacting profitability due to high yen-based costs and fluctuating exchange rates.
• Balancing strong production with improved breakeven point control through centralized development resources.
• Expanding overseas sales ratio, particularly in the rapidly growing Chinese and Asian markets.

Mitigation Strategies

• Accelerating procurement of materials in foreign currency and transitioning semiconductor test and assembly bases overseas.
• Consolidating production lines and improving production efficiency.
• Controlling the ratio of R&D costs to sales, producing strongly competitive products, and focusing development resources on products with promise in competitiveness and growth.
• Expanding sales base infrastructure in Chinese and Asian markets, increasing engineering staff to support local customers, and strengthening product development in line with local demand.

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: U.S. GAAP

Certifications: Null

Third-party Assurance: Ernst & Young Shin Nihon

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• NaviEngine (multicore car navigation LSI), CE131 (8-megapixel image signal processor), 32-bit microcontrollers with low power consumption.

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Ethical Business Practices
• Community Involvement
• Corporate Culture

Environmental Achievements

• All NEC Electronics Group companies have acquired ISO 14001 certification

Social Achievements

• Participation in the United Nations Global Compact
• Various community involvement activities (water-source forest protection, electronic industrial arts class for elementary school students, volunteer work at a local child-care home)
• Family-friendly workplace initiatives

Governance Achievements

• Adopted the corporate auditor system
• Introduced the Corporate Officer System to clarify responsibilities

Climate Goals & Targets

Environmental Challenges

• Severe economic downturn worldwide impacting semiconductor market demand
• Loss provision related to pending legal issues
• Expenses from closing manufacturing and R&D lines in Japan

Mitigation Strategies

• Accelerating structural reforms (realignment of manufacturing structures, enhanced R&D efficiency, cost reduction measures)
• Closing of manufacturing and R&D lines
• Reducing fixed costs, aiming to restore “EIGYO profit”

Supply Chain Management

Responsible Procurement

• CSR Guidelines issued on website specifying tasks for purchasing partners

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ISO 14001, ISO/TS16949, UN Global Compact

Certifications: ISO 9001, ISO 14001, ISO/TS16949

Sustainable Products & Innovation

• Eco-microcontrollers
• Embedded DRAM LSIs with low power consumption
• Discrete semiconductors for power supply controllers
• 4-channel LED driver ICs

Environmental Metrics

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced sales energy intensity by 27% compared to the base year.
• Reduced PFC emissions to below the previous year's level (per wafer area unit).
• Achieved a 42.1% recycling rate for water.

Social Achievements

• Continued environmental social contribution activities.
• Implemented environmental e-learning with a 98.4% completion rate.
• Awarded as an excellent business for energy saving in the "Summer Eco-Style Challenge" by Yamagata Prefecture.

Governance Achievements

• Optimized environmental management system and streamlined certification.
• Received unified domestic certification.
• Complied with various domestic and international regulations.

Climate Goals & Targets

Environmental Challenges

• High energy consumption in cleanrooms due to the use of high-tech equipment.
• Significant environmental burden from production activities, including chemical material usage and waste generation.
• Continued need for energy reduction due to projected power supply shortages.

Mitigation Strategies

• Introduction of energy-saving equipment, improved material usage efficiency, and installation of harmless disposal equipment in group factories.
• Implementation of stricter internal standards for emissions than legal requirements.
• Active promotion of energy-saving measures, including LED lighting, inverter control of air conditioners and pumps, and replacement of energy-efficient refrigerators and boilers.

Supply Chain Management

Responsible Procurement

• Green procurement prioritizing suppliers with strong environmental performance and non-hazardous materials.

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Environmental Report Guidelines 2012 (Ministry of the Environment, Japan), Environmental Accounting Guidelines 2005 (Ministry of the Environment, Japan), ISO 26000:2010 (Social Responsibility)

Certifications: ISO 14001

Awards & Recognition

• Excellent business award in Yamagata Prefecture's "Summer Eco-Style Challenge"

Environmental Metrics

ESG Focus Areas

• Not disclosed

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

• Environment
• Social
• Governance

Environmental Achievements

• Issued Green Bonds for US$1.35 billion for environmentally beneficial projects
• Improved ESG ratings from international research organizations (MSCI, Inc., FTSE, etc.) and inclusion in indexes such as the MSCI Japan Empowering Women Index (WIN).

Social Achievements

• Implemented Renesas Culture guideline of "Transparent, Agile, Global, Innovative, Entrepreneurial" (TAGIE) with initiatives like CEO roundtables, an in-house portal, and employee surveys.
• Introduced an in-house free agent system to optimize employee portfolio and enhance HR development.
• Promoted domestic and overseas social contribution activities.

Governance Achievements

• Strengthened governance with focus on the Board of Directors.
• Improved information disclosure through the Group's website.
• Established a voluntary Compensation Committee dominated by Outside Officers and chaired by an Outside Director.

Climate Goals & Targets

Environmental Challenges

• Supply disruptions due to increased demand, inflation, and labor shortages.
• Supply constraints in the semiconductor market due to natural disasters and the Covid-19 pandemic.
• Geopolitical issues, particularly prolonged trade friction between the U.S. and China.
• Challenges in aligning production with order lead times and business practices related to order finalization in the supply chain.
• Need to strengthen software development capabilities.

Mitigation Strategies

• Implemented logistics realignment measures to control costs.
• Strategic investment in integrating the ERP system to improve efficiency.
• Expanding production volumes at contract manufacturers and expanding facilities at its own plants.
• Strengthening disaster prevention measures, including expanding firefighting facilities and predictive maintenance systems.
• Strengthening software development and customer support systems by promoting internal development efficiency and leveraging outsourcing.
• Decentralizing design bases worldwide and optimizing resources.
• Acquisitions (Dialog and Celeno) to expand product portfolio and technologies.
• Improvements to supply chain structure and IT systems, establishment of chip stocks, review of business terms and conditions, and optimization of sales channels.

Supply Chain Management

Climate-Related Risks & Opportunities

Sustainable Products & Innovation

• RH850/U2B microcontroller
• R-Car S4 gateway SoC
• PMICs for automotive central computers
• 5G Beam Forming ICs
• 2 millimeter-wave device
• ZMOD4510 outdoor air quality sensor platform with ozone detection firmware

Environmental Metrics

ESG Focus Areas

• Environmental

Environmental Achievements

• Developed MCUs for Battery Management Systems (BMS) achieving 60-65% reduction in power consumption compared to competitor products.
• Developed IGBT technology reducing switching loss by 20% and conductive loss by 10%, reducing overall system-level loss by 15%.
• Developed radar MMIC reducing power consumption by 67% compared to current SiGe processes, and by 40% compared to larger scale RFCMOS processes.
• Developed processor technologies for automotive SoCs achieving best-in-class power efficiency of 13.8 TOPS/W.
• R-Car solutions improve CNN performance efficiency by 20%, and PMIC solutions reduce power loss by up to 33%.
• Developed model-based design technique to reduce power consumption of on-vehicle LSIs, optimizing dedicated circuits for image recognition processing.
• DDR5 memory interface chips improve bandwidth power efficiency by 16%.
• Introduced I3C intelligent switch devices reducing complexity of high-performance system designs and offering very low power.
• 5G beamformer IC family with 33% lower power consumption, leading to 8.4Kt of reduced/avoided GHG per year.
• 8th generation IGBTs reducing power loss by more than 30% and increasing energy efficiency.
• AI technology for factories achieving the same processing power as high-end AI chips using only a few watts of electricity.
• RZ/V MPU series reducing power consumption by 80% compared to previous generations.
• RL78, RX, and RA MCUs achieving 30% less electricity consumption compared to past products.
• Developed circuit technologies for an embedded STT-MRAM test chip achieving 5.9-nanosecond random read access and a write throughput of 5.8-megabyte-per-second.
• Developed 2.4 GHz RF transceiver technologies supporting Bluetooth® Low Energy with power consumption of 3.6 mW and 4.1 mW during reception and transmission respectively.

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: ICMA Green Bond Principles 2021

Third-party Assurance: Sustainalytics

Sustainable Products & Innovation

• xEV Inverter Reference Solutions
• RH850/U2B MCUs
• IGBT technology
• AUTOSAR-compliant complex device driver (CDD) software module
• R-Car V3H SoC
• DDR4 and DDR5 registered clock drivers (RCDs)
• I3C intelligent switch devices
• 5G beamformer IC family (F5288 and F5268)
• 8th generation IGBTs
• AI technology for factories
• RZ/V MPU series
• RL78, RX, and RA MCUs
• HS4XXX family of relative humidity and temperature sensors
• ZSSC3281 sensor signal conditioning (SSC) IC
• embedded spin-transfer torque magnetoresistive random-access memory (STT-MRAM)
• 2.4 GHz RF transceiver technologies

Awards & Recognition

• Outstanding Business Operator Award at the 2021 NEDO Energy Conservation Technology Development Award