Climate Change Data

Environmental Metrics

ESG Focus Areas

• Governance
• Social
• Environmental

Environmental Achievements

• Reduced CO2 emissions by 5.6% year-on-year in Japan (64,000 t-CO2 in FY2021)
• Maintained 100% zero emissions record in Japan for waste destined for direct landfill disposal
• Achieved 99.3% zero emissions rate overseas (up 2.0 points year-on-year)

Social Achievements

• Launched multiple project teams in 2021 to promote better communication and working environments
• Improved ratings in all items of CSR surveys conducted on 55 business partners in FY2021
• Revamped company goals management system in 2021 to clarify the link between company goals and individual goals

Governance Achievements

• Transitioned to the TSE Prime Market in April 2022, promoting further strengthening of corporate governance
• Established a Nomination and Remuneration Advisory Committee to enhance fairness, transparency, and objectivity
• Implemented an evaluation of the effectiveness of the Board of Directors every fiscal year

Climate Goals & Targets

Environmental Challenges

• Global supply chain disruptions due to the COVID-19 pandemic and the war in Ukraine
• Rising raw material costs
• Increasing importance of energy conservation for decarbonization

Mitigation Strategies

• Strengthening of internal control, risk management and BCP systems
• Promoting energy conservation initiatives (e.g., upgrading to highly energy-efficient air compressors, swapping out electric lighting for LEDs)
• Encouraging business partners to reduce CO2 emissions, considering low-emitting materials, and increasing the ratio of renewable power

Supply Chain Management

Supplier Audits: Approximately 200 business partners audited in FY2021

Responsible Procurement

• CMK Group Procurement Policy (Compliance with laws and societal norms, fair and equitable transactions, responsible procurement considering human rights and the global environment)
• Green procurement prioritizing materials with low environmental impact from partners with well-established environmental management systems
• Surveys to trace the use of minerals from conflict-affected and high-risk areas

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters (acute and chronic impacts)

Transition Risks

• Impact of carbon tax
• Strengthening of decarbonization policies
• Changes in customer behavior and demand for responsible action against climate change

Opportunities

• Progress in shift to EVs and FCVs
• Increased demand for products used in EVs
• Increased demand for products for dedicated charging devices and other EV-related equipment

Reporting Standards

Frameworks Used: ISO 26000, TCFD

Certifications: ISO 9001, ISO 14001, IATF 16949

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Environmentally-friendly PCB “E-spec”

Awards & Recognition

• Special Contribution Award at Denso Ten Limited’s FY2021 Supplier Appreciation Convention

Environmental Metrics

ESG Focus Areas

• Organizational governance
• Human rights/Labor practices
• Fair operating practices
• Technological innovation
• The environment

Environmental Achievements

• Reduced CO2 emissions by 95.5% (Domestic) and 80.6% (Overseas) compared to the previous year. Achieved 100% zero emissions (Domestic) and 99.4% (Overseas) in waste destined for direct landfill disposal.
• Reduced energy consumption by 90.5% (Domestic) and 82.7% (Overseas) compared to the previous year.
• Reduced power consumption by approximately 3,600,000 kWh through various energy-saving measures.

Social Achievements

• Established the CMK Group Human Rights Policy.
• Increased the percentage of women in management to 4.2% exceeding the industry average.
• Maintained an employment rate of people with disabilities exceeding the legal requirement (2.74%).
• Conducted CSR surveys of 55 business partners, showing improved ratings across all items.

Governance Achievements

• Established a Nomination and Remuneration Advisory Committee.
• Implemented an evaluation of the effectiveness of the Board of Directors.
• Strengthened information security measures.

Climate Goals & Targets

Environmental Challenges

• Severe business environment due to semiconductor shortages and supply chain disruptions.
• Rising energy costs.
• Managing climate-related risks, including carbon tax implications, strengthening decarbonization policies, and changes in customer behavior.
• Managing supply chain emissions (Scope 3 emissions constitute a large proportion).

Mitigation Strategies

• Developed and implemented a Medium- to Long-Term Environmental Action Plan.
• Endorsed the TCFD and developed strategies to mitigate climate change.
• Implemented various energy-saving measures and promoted the use of renewable energy.
• Engaged in achieving the new plan “Smart e-changes 30 plus” to address supply chain emissions.
• Strengthened risk management and BCP systems.
• Implemented initiatives to ensure business continuity.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• CMK Group Procurement Policy (including compliance with laws, fair transactions, and responsible procurement considering human rights and the environment).
• Green procurement activities prioritizing business partners with well-established environmental management systems.
• EHS management audits of business partners.

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters (acute and chronic)

Transition Risks

• Impact of carbon tax
• Strengthening of decarbonization policies
• Changes in customer behavior

Opportunities

• Increased demand for products used in EVs
• Increased demand for products for dedicated charging devices and other EV-related equipment

Reporting Standards

Frameworks Used: TCFD, ISO 26000

Certifications: ISO 9001, ISO 14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Environmentally-friendly PCB “E-spec”

Awards & Recognition

• Not disclosed