Climate Change Data

Environmental Metrics

ESG Focus Areas

• Climate Change
• Environmental Sustainability
• Social Responsibility
• Governance

Environmental Achievements

• Converted 100% of the flagship store's lighting to LEDs
• Converted power supply for Higashi-matsuyama DC warehouse to 100% renewable energy
• Produced approximately 40,000 products by reusing purified wastewater during the washing process
• Used paint made from recycled eggshells in flagship store renovation
• Renovated some existing floors and fixtures in flagship store using reused materials

Social Achievements

• Launched "TUIN greenery" concept shop/flagship store for "SHEL'TTER GREEN" green business

Governance Achievements

• Established Sustainability Promotion Office and Sustainability Committee (May 2022) to examine sustainability and climate change risks
• Established a system to respond to external disclosure requests (TCFD, CDP questionnaires)

Climate Goals & Targets

Environmental Challenges

• Increased procurement costs due to carbon tax introduction
• Increased transportation energy costs and renewable energy procurement costs
• Potential negative impact on customer support due to increased product prices
• Growing demand for climate-related information disclosure
• Increased risk of supply chain disruption due to intensified weather disasters (drought, flooding)
• Impact on store operations due to increased risk of flooding
• Developers' increasing demand for decarbonization from tenants

Mitigation Strategies

• Promoting appropriate procurement through improved forecasting and inventory management
• Strengthening cooperation with suppliers to reduce procurement costs
• Promoting energy consumption reduction through improved transportation efficiency and investment in energy saving
• Promoting energy saving and actively utilizing renewable energy to reduce the impact of carbon tax
• Promoting appropriate disclosure through a system for responding to external requests
• Promoting disaster countermeasures at logistics bases and strengthening cooperation with suppliers
• Developing new suppliers, considering decentralization, and developing a stable procurement system
• Promoting disaster countermeasures at each store and strengthening information collection and countermeasure planning systems
• Further promoting initiatives to reduce environmental impact within stores (reuse of materials, environmentally friendly materials)
• Growing businesses like "Shelter Green" and "M_"

Supply Chain Management

Responsible Procurement

• Strengthening cooperation with suppliers regarding disaster countermeasures and cost reduction

Climate-Related Risks & Opportunities

Physical Risks

• Drought in cotton production regions
• Flooding impacting store operations and supply chain

Transition Risks

• Introduction of carbon tax
• Growing demand for information disclosure
• Strengthening decarbonization efforts by developers

Opportunities

• Growing demand for eco-friendly products
• Emergence of commercial facilities specializing in environmentally conscious tenants

Reporting Standards

Frameworks Used: TCFD

Sustainable Products & Innovation

• MOUSSY denim and other eco-friendly products
• Products using recycled and environmentally friendly materials (organic cotton, recycled fiber, regenerated fiber)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Environmental Sustainability
• Social Responsibility
• Governance

Environmental Achievements

• Reduced CO2 emissions (Scope 1 & 2) by 50% by 2030 (target)
• Reduced CO2 emissions per item of clothing by 20% by 2030 (target)
• Increased the proportion of clothing made from environmentally friendly materials to 11.6% in FY2023 (actual)
• Promoting the use of LED lighting in stores and headquarters
• Converting electricity used in headquarters, warehouses, and stores to renewable energy
• Reducing water usage
• Reducing use of chemical substances
• Sewage discharge control

Social Achievements

• Developing and selling products that use recycled materials and environmentally friendly materials (organic cotton, recycled fiber, regenerated fiber)
• Growing businesses such as the green business “Shelter Green” and the ethical brand “M_”

Governance Achievements

• Established the Sustainability Committee in May 2022 to examine sustainability, including climate change risks.
• Established a system for responding to external disclosure requests such as information disclosure in accordance with TCFD and responses to CDP questionnaires.
• Annual review of climate change-related risks/opportunities

Climate Goals & Targets

Environmental Challenges

• Increase in procurement costs due to the introduction of a carbon tax
• Increased transportation energy costs and in-house renewable energy procurement costs due to various tax systems and the promotion of low-carbon transportation
• Potential negative impact on customer support if carbon taxes affect product prices
• Growing demand for information disclosure related to climate change
• Increased risk of supply chain disruption due to intensification of weather disasters (drought, flooding)
• Impact on store operations due to increased risk of store inundation from flooding
• Developers' increasing demand for decarbonization of tenants, potentially affecting store opening strategy

Mitigation Strategies

• Promoting appropriate procurement by improving supply and demand forecasts and inventory management
• Strengthening cooperation with suppliers to reduce procurement costs
• Promoting efforts to reduce energy consumption by improving transportation efficiency and investing in energy saving in warehouses
• Reducing the impact of the carbon tax by promoting energy saving and actively utilizing renewable energy
• Promoting appropriate disclosure by establishing a system for responding to external disclosure requests
• Promoting disaster countermeasures at logistics bases and strengthening cooperation with suppliers
• Developing new suppliers, considering decentralization, and developing a stable procurement system
• Promoting disaster countermeasures at each store and strengthening the system for collecting information and planning countermeasures
• Further promoting initiatives to reduce the environmental impact within stores (reuse of materials, use of environmentally friendly materials, switching plastic shoppers to paper/recycled paper)
• Purchasing De-fossilization certificates from developers

Supply Chain Management

Responsible Procurement

• Strengthening cooperation with suppliers regarding disaster countermeasures and cost reduction
• Developing new suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Increased risk of drought in cotton production regions
• Increased risk of flooding impacting store operations and supply chain

Transition Risks

• Introduction of carbon tax increasing procurement costs
• Growing demand for information disclosure
• Strengthening decarbonization efforts by developers

Opportunities

• Growing demand for eco-friendly products matching consumers' ethical orientation
• Growing demand for products using recycled and environmentally friendly materials
• Emergence of commercial facilities specializing in tenants working to reduce environmental impact

Reporting Standards

Frameworks Used: TCFD

Sustainable Products & Innovation

• Eco-friendly products (MOUSSY denim)
• Products using recycled and organic materials