Climate Change Data

Environmental Metrics

ESG Focus Areas

• Sustainable supply chain management
• Enhancement of the management foundation
• Climate change
• Human rights
• Diversity and inclusion

Environmental Achievements

• Development of refrigerators using natural refrigerants
• Waste recycling rate of 99.3%

Social Achievements

• Increased percentage of female employees to 16.7%
• Increased percentage of female executives to 8.9%
• Implementation of HR management program to train candidates for global management

Governance Achievements

• Strengthened corporate governance
• Reinforced internal controls
• Increased percentage of Outside Directors to 36.4%

Climate Goals & Targets

Environmental Challenges

• Increased CO2 emissions at domestic locations due to increased equipment operation rates
• Increased waste generation at domestic locations due to increased production activities
• Supply chain disruptions due to rising raw material prices and shortages
• Improper transactions discovered at domestic distributors in 2018 and 2019

Mitigation Strategies

• Replacement with energy-saving equipment
• Building supply chains that take measures for the environment and human rights
• Strengthening corporate governance and internal controls
• Implementing strategic price increases and cost-cutting measures
• Actively working to develop new markets overseas

Supply Chain Management

Responsible Procurement

• Monitoring every link in global supply chains to ensure waste is minimized and safe working conditions are maintained

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters caused by climate change

Sustainable Products & Innovation

• Refrigerators with natural refrigerants

Awards & Recognition

• Good Design Award (tea dispenser and cubelet ice dispenser)

Environmental Metrics

ESG Focus Areas

• Response to climate change
• Sustainable supply chain management
• Creation of new customer value
• New proposal for creation of secure and safe food environment
• Increasing employees’ job satisfaction
• Enhancement of management foundation

Environmental Achievements

• Reduced CO2 emissions from business activities (Scope 1 & 2) by 22.7% compared to FY2014 (as of FY2021). Target is 50% reduction by FY2030.
• Head Office Factory and Shimane Factory achieved a recycling rate over 99.0%.

Social Achievements

• Increased employee satisfaction scores (ES survey results show steady improvement).
• Kagayaki Project/Committee initiatives to increase women in managerial positions; new targets set for 2025.

Governance Achievements

• Established Sustainability Committee to manage climate change issues and report to the Board of Directors.
• Endorsed TCFD recommendations in February 2022.

Climate Goals & Targets

Environmental Challenges

• Increased CO2 emissions in FY2021 (despite initiatives) due to increased production volume.
• Difficulties in achieving some environmental goals in FY2021 due to the impact of COVID-19.
• Challenges in increasing the number of men taking long-term childcare leave.

Mitigation Strategies

• Implementing power-saving equipment, improved equipment operation, and improved operational efficiency to reduce CO2 emissions.
• Developing and selling environmentally friendly products.
• Promoting awareness and understanding of paid leave system to encourage employees to take paid leave.
• Improving systems and supporting employees’ work-life balance.

Supply Chain Management

Supplier Audits: Periodic on-site audits by overseas group companies (e.g., HOSHIZAKI AMERICA).

Responsible Procurement

• Purchasing policy requiring suppliers to acknowledge the Group’s purchasing policy and assessment based on evaluation criteria.
• Use of a supplier checklist based on ISO rules.

Climate-Related Risks & Opportunities

Physical Risks

• Temperature rise impacting food refrigeration and edible and commercial ice demand
• Fierce heat shrinking the restaurant market

Transition Risks

• Stricter regulations on refrigerants
• Increased R&D costs and capital investment due to response to stricter regulations on refrigerants and further decarbonization of products

Opportunities

• Expansion in demand for replacement with natural refrigerants and carbon-free products
• Increased demand for food refrigeration and edible and commercial ice due to temperature rise
• Increased demand for energy-saving products

Reporting Standards

Frameworks Used: TCFD

Certifications: ISO 14001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 7 (Affordable and clean energy)
• Goal 13 (Climate action)
• Goal 8 (Decent work and economic growth)
• Goal 5 (Gender equality)
• Goal 12 (Responsible consumption and production)

The report highlights the alignment of Hoshizaki's initiatives with these SDGs through various programs and targets.

Sustainable Products & Innovation

• Environmentally friendly products with improved energy-saving performance and no CFCs.
• Products exceeding Top Runner Program Standards (Japan).
• Steelheart series commercial refrigerators and KMEdge X series ice machines (Americas).
• Non-CFC products using natural refrigerant propane (R290) (Europe).

Awards & Recognition

• Partner of the Year – Product Brand Owner (HOSHIZAKI AMERICA, 10 consecutive years)
• Partner of the Year – Sustained Excellence (HOSHIZAKI AMERICA, 7 consecutive years)