Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environment (E)
• Social (S)
• Governance (G)

Environmental Achievements

• Not disclosed

Social Achievements

• Implemented a plan to fundamentally reform the personnel system, including the evaluation system, within the next 2-3 years.
• Promoted internal digitalization as a result of the increased need for telework during the pandemic, including providing employees with laptops and mobile phones to maximize telework.

Governance Achievements

• Transitioned from a board of directors company to an audit and supervisory board company in February 2021, strengthening governance and accelerating decision-making.

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impact on the food market, particularly the decline in demand from the food service and leisure industries.
• Yen appreciation throughout the year and market stagnation due to the pandemic.

Mitigation Strategies

• Developed alternative sourcing strategies and strengthened/diversified the supply chain.
• Successfully expanded sales in Asia, particularly in China, despite lockdowns in various countries.
• Leveraged the increased demand for home-consumed food and the quick recovery of demand in China to maintain sales.
• Accelerated the expansion of sales areas and strengthened the sales network, manufacturing business, and product lineup to further expand business.

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

• Sustainable supply chain
• Climate change adaptation and environmental load reduction
• Providing safe and secure food
• Creating a workplace where diverse employees can work with pride
• Governance enhancement
• Contribution to healthy and affluent lives

Environmental Achievements

• Reduced GHG emissions (Specific figures not provided, but reduction efforts mentioned)
• Initiatives for food loss reduction and waste reduction (Specific figures not provided)

Social Achievements

• Resumed overseas training programs for young employees in 2023
• Promoted diversity and inclusion (Specific figures provided for women in management, but other details are limited)

Governance Achievements

• Strengthened corporate governance through active engagement of the Nomination and Remuneration Advisory Committee (15 meetings in FY2023)
• Implemented a robust risk management system

Climate Goals & Targets

Environmental Challenges

• Decreasing domestic milk production in Japan, requiring increased imports
• Fluctuations in global dairy prices and exchange rates
• Climate change impacts on dairy production
• Supply chain disruptions due to the pandemic and geopolitical risks
• Overstock of domestic skim milk powder (resolved in 2023)
• Maintaining profitability while ensuring stable supply

Mitigation Strategies

• Diversification of supply sources
• Development of value-added products
• Strengthening relationships with suppliers and customers
• Active participation in industry initiatives to address skim milk powder overstock
• Implementing BS (Balance Sheet) management to improve financial stability
• Focus on efficiency and profitability

Supply Chain Management

Supplier Audits: Supplier audits conducted regularly to ensure quality, technology, and safety management

Responsible Procurement

• Supplier selection based on quality, technology, and safety management
• Collaboration with suppliers on safety and quality management

Climate-Related Risks & Opportunities

Physical Risks

• Decreased bioresource production due to changes in rainfall patterns and average temperature
• Changes in product demand due to chronic climate change

Transition Risks

• Increased raw material costs due to carbon tax
• Decreased sales due to slow response to low-carbon products
• Increased raw material costs due to supplier investments in GHG reduction

Opportunities

• Increased sales of imported dairy products due to decreased domestic milk production
• Increased sales due to higher demand for BCP in supply

Reporting Standards

Frameworks Used: GRI Standards, ISO 26000

UN Sustainable Development Goals

• SDG 2: Zero Hunger
• SDG 3: Good Health and Well-being
• SDG 8: Decent Work and Economic Growth
• SDG 12: Responsible Consumption and Production
• SDG 13: Climate Action

The company's initiatives contribute to these SDGs through sustainable supply chain management, climate change adaptation, and promotion of healthy lifestyles.

Environmental Metrics

ESG Focus Areas

• Supplying safe and reliable food
• Contributing to a healthy and enriched life
• Stable supply through sustainable dairy and livestock farming
• Adaptation to climate change and reduction of environmental impact
• Creating workplaces where diverse human resources can work with pride
• Enhance governance

Environmental Achievements

• Not disclosed

Social Achievements

• Promotion of diversity: ratio of female managers at least 20% in 3 years, at least 30% in 10 years (FY11/22: 19.7%), development of good working environment: male childcare leave (parental leave) acquisition rate of 100% in 3 years (FY11/22: 66.7%), strengthening of human resource development: education costs per person to triple in three years

Governance Achievements

• Responsible supply chain management, full compliance in corporate governance, risk management

Climate Goals & Targets

Environmental Challenges

• Higher milk prices due to soaring prices for items like feed, lower consumption of dairy products in general due to price hikes, decreased sales of imported powdered milk mixtures due to the extension of measures to reduce surplus inventory of domestically produced skim milk powder, lower sales of powdered milk product ingredients for Japan in Asia, and less demand for dairy ingredients in Asia due to impact from China’s economic slowdown
• Impact on consumption from dairy manufacturers and others’ price hikes and impact on domestic skim milk powder inventories from the uptrend in raw milk production since February 2024

Mitigation Strategies

• Diversification of supply sources, best matching, dairy farmer development, improving efficiency and labor saving in procurement and supply through promotion of digitalization
• Export of Japanese foodstuffs (dairy products, health foods)

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Diversification of supply sources

Climate-Related Risks & Opportunities

Physical Risks

• Regional fluctuations in production of dairy and livestock products due to climate change

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: TCFD

Certifications: Halal, FSSC 22000

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Vegan cheese

Awards & Recognition

• Not disclosed

Environmental Metrics

Governance Achievements

• Introduced ROIC as a management indicator for business divisions.
• Increased dividend payout ratio (FY11/2023: 23.2% → FY11/2024: 25.3% → FY11/2025 [forecast]: 30.2%)
• Established the Corporate Sustainability Department to strengthen sustainability initiatives (October 2024).

Climate Goals & Targets

Environmental Challenges

• Competition with domestic meat intensified due to high international market prices and weak yen.
• Struggled to meet initial sales target for plant-derived ingredients.
• Expansion of sales to local Asian companies continues to be an issue for both dairy ingredients sales and cheese manufacturing and sales.

Mitigation Strategies

• Improved procurement capabilities by strengthening relationships with existing suppliers and cultivating new suppliers.
• Strengthened collaboration with U.S. suppliers and expanded sales of pork.
• Strengthened proposals by combining multiple functional ingredients.
• Strengthened local sales force for dairy ingredients (Indonesia, Thailand).
• Improved manufacturing efficiency by reviewing merchandise.

Supply Chain Management

Responsible Procurement

• Strengthening ties with existing suppliers and cultivating new suppliers (dairy ingredients).

Climate-Related Risks & Opportunities