Sekisui Environmental Sustainability Index: Overall volume of returns of natural capital by the group / Overall volume of usage of natural capital by the group

Calculating the usage and return volumes of natural capital
Employing LIME2 (a damage calculation-based impact assessment method developed for use in Japan by Professor Norihiro Itsubo of Tokyo City University) and covering all the criteria for conservation defined by LIME2, the impacts on each of “human health (including the effects of global warming),” “societal assets (including the effects of global warming),” “the effects on plants (reducing interference with growth),” and “the effects on life (restricting the extinction of living species)” were evaluated and then made into a single indicator^*1
The amount of return to natural capital was calculated as the reduction in the risk of harm to natural capital because of the whole group’s various initiatives that contribute to the environment, relative to if these initiatives had not been implemented

• *1
  In the previous medium-term plan, the scope of contributions to the environment was limited to the natural environment. Therefore, the calculation of returns to natural capital consisted only of the combination of three targets directly related to the natural environment: “curtailing global warming (the effects on human health only),” “the effects on plants (reducing interference with growth),” and “the effects on life (restricting the extinction of living species)” Starting with the current medium-term plan of fiscal year 2017, criteria for environmental contributions were extended to included contributions to the social environment, thereby adding impacts on “societal assets” to returns to natural capital.

Items included in the calculation of the amount of natural capital used
Direct usage: Use of land, greenhouse gases, amounts of emissions into the air of PRTR substances and air pollutants, the COD volume of discharges into bodies of water
Indirect usage: Purchased raw materials, energy use, amount of water used, amount of waste material emitted, amount of GHGs emitted indirectly in supply chains (Scope 3)

Items included in the calculation of returns to natural capital
Amount of contributions to reducing usage of natural capital through Environment-contributing Products, the amount of contribution from environmental conservation activities, environment-related donations, mega-solar power generation output

Scope of Calculation / isting by category of calculation: Trial calculations were conducted using the following assumed conditions:

• • Raw materials:
    Purchased raw materials covered; estimates incorporated into calculations
    Concerning housing, the calculation includes the constituent raw materials for one structure multiplied by the number of structures manufactured
• • Manufacturing / Emissions of harmful
    chemical substances:
    <Japan>emissions of 1 t per year or more of substances covered under PRTR are included in the calculation.<Overseas>Not included
• • Manufacturing / Land maintenance:
    Domestic Japanese and overseas plants and research facilities
    were incorporated into the calculation using the area of the premises, generally considered in terms of the land used for buildings.^*2 The areas of the premises of overseas plants were estimated. The effects of land usage are included in the calculation based on the 30-year period after the purchase of the land
  • *2
    Concerning land usage, starting with the current medium-term plan (2017-19), improvements to soil quality in the “JBIB Land Use Score Card®” were deemed as reductions of the impact of land usage, weighted accordingly, and included in the calculation.
• • Others:
    Capital goods in supply chains, other fuel- and energy-related activities, transport and
    shipping, waste, business trips, commuting by employees, leased assets (downstream), processing/use/disposal of sold products
    Business trips and commuting by employees: Covers consolidated numbers of employees and includes some estimation
    Use of sold products: Covers housing sold during the fiscal year, and included in the calculation with assumed energy usage for 60 years into the future
    Processing of sold products: Energy usage by customers while processing products anticipated to consume large amounts of energy was estimated and included in the calculation
    Disposal of sold products: Major raw materials for each fiscal year were covered and included in the calculation based on the assumption that they would be made into products and disposed of during that fiscal year
• • Product contributions:
    (1) The differences in contribution to the environment between the relevant products and previous technologies were evaluated qualitatively for each
    criterion, based on the contribution to the natural and social environments for each life-cycle (the five stages of procurement of raw materials, manufacturing, distribution, usage/maintenance, disposal, and recycling) in terms of CO₂ reductions and energy savings, reductions in waste materials, resource savings, water-savings and the water cycle, preventing pollution, direct preservation of biodiversity, QOL improvements, and other factors. For factors for which a significant difference was estimated, data per product unit was investigated.
    (2) Based on the results of these investigations, a coefficient for calculating the impact on the environment for each series of data was multiplied by the data, yielding a calculation of the degree of contribution to the environment of each product unit.
    (3) The sales results for products in each fiscal year were multiplied by the results found in (2) to calculate the degree of contribution to the environment for each product, and the results were included in the calculation. Trial calculation performed on the effects of products equivalent to around 90% of Environment-contributing Products
• • Direct contribution / Contribution
    from activities reducing environmental impacts:
    The effects on the environment relating to production for each fiscal year were compared to “the effects on the environment relating to manufacturing in fiscal year 2016 × (revenue in that fiscal year / revenue in fiscal year 2016),” and the difference was included in the calculation. There was a proportional relationship between revenue and the effects on the environment relating to manufacturing, based on the idea that the difference was the result of efforts undertaken in the group's activities.
• • Direct contribution / Conservation
    of the natural environment:
    The group keeps track of the number of participants and the amount of time spent on each activity. In the case of planting cedar trees, a fixed amount of CO₂ (1.1 t-CO₂/person-hour) was multiplied by the number of people and the amount of time spent and incorporated into the calculation. Because, starting with the current medium-term plan (2017-19), improving the sustainability of activities through local cooperation and by making them stand on their own (autonomous) were made a target, the groups ability to work toward this target was weighted against the growth axis and included in the calculation
• • Direct contributions / donations:
    The amount intended to be paid for conservation was deemed equal to the amount of money calculated for damage caused and included in the calculation.
• • Direct contribution / Mega-solar:
    Amount of electricity generated included in the calculation as generated energy converted to a CO₂ basis