Targets

The long-term goal of SEKISUI CHEMICAL Group's environmental activities is to realize an earth with maintained biodiversity as stated in its Long-term Environmental Management Vision, SEKISUI Environment Sustainability Vision 2050. To this end, we believe it is important to simultaneously achieve the long-term goals for environmental issues such as climate change, resource recycling, and water-related risks. In the current Environmental Medium-term Plan, Sekisui Environment Sustainability Plan: Accelerate II (fiscal 2020-2022), we have implemented initiatives to solve environmental issues while recognizing the correlation between each issue. Looking ahead, we will further improve the quality of our efforts to avoid trade-offs with other environmental issues as we work to resolve them. Progress on each environmental issue is managed by setting milestones that are backcast from long-term targets and are based on individual management targets. Regarding overall progress for environmental issues, we will continue to use the integrated Sekisui Environment Sustainability Index to monitor the progress of the Group's overall environmental management.

Approach to Environmental Issues and Our Long-term Vision:
Long-term Environmental Management Vision, SEKISUI Environment Sustainability Vision 2050

Through its corporate activities, products, and businesses, SEKISUI CHEMICAL Group contributes to solving various natural and social environmental issues in order to realize an earth with maintained biodiversity. We remain conscious that the business activities we carry out incorporate the earth’s natural capital as well as meaningful social capital from society. We are therefore committed to accelerating efforts aimed at returning such capital back to the environment and society while collaborating with stakeholders.
Working toward the realization of an earth with maintained biodiversity entails the same stance required to achieve the SDGs set for 2030. This is because this earth cannot be realized without a society in which many of the issues in natural and social environments have been solved.
The following three activities are emphasized as activities that contribute to solving issues.

  • (1)
    Expand and create markets for products to enhance sustainability*1
  • (2)
    Reduce environmental impact
  • (3)
    Conserve the natural and social environments*2
  • 08-86

*Stakeholders: "Customers", "Shareholders", "Employees", "Business partners", "Local Communities and the Environment"

In order to revitalize these activities and solve issues more quickly, we believe it is necessary not only for each employee to be aware of various environmental issues and become an organization with a strong ability to help solve problems, but also to work in partnership with all stakeholders to promote these activities.
Backcasting from the Group’s vision for 2050, we have set milestones for medium-term units and formulated an environmental roadmap. In fiscal 2022, we updated our environmental roadmap from the following perspectives, undertaking a review of the status of social demands and environmental issues, as well as corporate risks and opportunities.

  • The state to be achieved over the medium term by addressing environmental issues
  • Important environmental issues that should be addressed and medium-term milestones
  • 07-01

Environmental Roadmap

Setting Long-term Goals for Eeach Environmental Issue

In order to realize an earth with maintained biodiversity targeted under our Long-term Environmental Management Vision, we have identified the following environmental issues of particular importance and the goals we aim to achieve by 2050

  • Climate change: Realize zero greenhouse gas emissions that arise from business activities (achieve carbon neutrality)
  • Resource recycling: Realize a circular economy
  • Water-related risks: Realize societies with abundant access to clean water

By achieving all of these long-term goals for environmental issues, we aim to achieve

  • Biodiversity: An Earth with Maintained Biodiversity (= Realize Nature Positive)
  • 07-02

Long-term Goals by Environmental Issue

For each environmental issue, we have drawn a roadmap backcasted from the 2050 goal and set individual medium-term milestones.
Environmental issues are interrelated, and selecting and promoting solutions that do not involve trade-offs for any of them will enable the simultaneous realization of long-term goals. To that end, we will focus on increasing the quality of initiatives to solve environmental issues in the next Medium-term Management Plan.

  • 07-03

Correlation between Environmental Issues

  • 07-21

Trends in Environmental Issue Initiatives Enhancement Points

Medium-term Milestones and Action Plan:
Environmental Medium-term Plan, Sekisui Environment Sustainability Plan: Accelerate II (fiscal 2020-2022)

We implemented our three-year Environmental Medium-term Plan, SEKISUI Environment Sustainability Plan: Accelerate II, from fiscal 2020. As discussed above, using backcasting to achieve the goals we have set for 2050 in our Long-term Environmental Management Vision, SEKISUI Environment Sustainability Vision 2050, we are aiming for milestones established for the Medium-term Plan and implemented initiatives for each important working item.

SEKISUI CHEMICAL Group has identified climate change, water-related risks, and resource recycling as important environmental issues that the Group should address. To accelerate the solution of these issues in an effort to reach our long-term goals, we are setting categories that form the core of ongoing important initiatives from the previous medium-term plan and focusing in particular on three categories: creating and expanding the market for products to enhance sustainability; reducing environmental impact; and environmental conservation.
We have identified the following initiatives to be further specialized in the next Medium-term Management Plan:
・Supply chain management
・Improve employees’ ability to contribute to solving social issues

We have set the following targets and have launched initiatives for the key items listed as follows within our Environmental Medium-term Plan, SEKISUI Environment Sustainability Plan: Accelerate II.

Improving the Rate of Return of Natural and Social Capital
Monitoring progress with the integrated index, Sekisui Environment Sustainability Index: Maintaining a rate of return to natural capital of 100% or more

Improve the Sustainability of the Earth and Society with Our Products
Sales of products to enhance sustainability: 800 billion yen

Initiatives Aimed at Addressing Climate Change
[Decarbonization]
Renewable energy ratio of purchased electricity: 20%
Reductions in greenhouse gas emissions: 9% or more (compared with fiscal 2013)

Initiatives Aimed at Addressing Resource Depletion
[Promoting resource recycling]
Recycling rate for waste materials: Grasp current conditions and set a baseline (achieve double or more of the baseline by fiscal 2025)

Initiatives Aimed at Addressing Water-Related Risks
[Preservation of water resources]
Water intake volume at production sites which use large quantities of water: 10% reduction (compared with fiscal 2016)
Total COD volume of river discharge water at production sites with large COD emission volumes: 10% reduction (compared with fiscal 2016)
[Minimizing water-related risks]
Understanding water-related risks specific to watersheds and implementing related initiatives

Improving the Ability of Employees to Contribute to Solving Issues
Promoting SDGs contribution activities

In the medium-term plan, “Sekisui Environment Sustainability Plan: EXTEND,” starting from fiscal 2023, we will pursue the following goals.

Improving the Rate of Return of Natural and Social Capital
Monitoring progress with the integrated index, Sekisui Environment Sustainability Index: Maintaining a rate of return to natural capital of 100% or more

Improve the Sustainability of the Earth and Society with Our Products
Sales of products to enhance sustainability in excess of 1 trillion yen

Initiatives Aimed at Addressing Climate Change
[Decarbonization]
Renewable energy ratio of purchased electricity: 70%
Reductions in greenhouse gas emissions: 33% or more (compared with fiscal 2019)

Initiatives Aimed at Addressing Resource Depletion
[Promoting resource recycling]
Recycling rate for waste plastic materials: 65%

Initiatives Aimed at Addressing Water-Related Risks
[Preservation of water resources]
Water intake volume at production sites which use large quantities of water: 10% reduction (compared with fiscal 2016)
Total COD volume of river discharge water at production sites with large COD emission volumes: 10% reduction (over the three-year period of the Medium-term Plan) (compared with fiscal 2016)
[Minimizing water-related risks]
Implementing measures aimed at minimizing the impact of water-related risks at sites where the impact on business is significant

Improving the Ability of Employees to Contribute to Problem Solving
Promoting Training
Promoting SDGs contribution activities

Summary of Crucial Action Items in the Current Environmental Medium-term Plan

Products to enhance sustainability

Since its launch in 2006, the predecessor of the products to enhance sustainability, the Environment-Contributing Products program, has on the basis of internal standards registered products that have a high degree of contribution to solving environmental issues. We had committed to society to increase the ratio of such products in all of the Company’s products and had been promoting the creation of products that solve social issues and the expansion of those product markets. Since the system's inception, we have continued to accelerate our efforts to solve environmental issues through our products, aiming to balance ecology and economy.

In fiscal 2017, we expanded the scope of Environment-Contributing Products to encompass not only the natural environment but also human capital and social capital. SEKISUI CHEMICAL Group aims to improve the lives of the people and the earth’s environment. In terms of improving people’s lives, we believe it is essential to solve the issues noted in the Sustainable Development Goals (SDGs) adopted by the UN in 2015, including promoting welfare and health, improving the global environment, and securing robust infrastructure by mitigating and adapting to climate change. We reaffirm our commitment toward addressing and resolving issues in these areas. First, we are promoting our efforts by maintaining a focus on solving these issues.

From fiscal 2020, we have renamed our product system to products to enhance sustainability and launched two new operations to grow as a company by continuously solving social issues (including environmental issues) and to improve our Companywide sustainable management and profit generation capabilities.

  • Sustainability assessment: To improve the sustainability of both the Company and its products, we have implemented verifications and assessments in regard to governance (internal control), the supply chain, customer satisfaction, and social responsibilities and risks, including environmental considerations within development processes.
    We identify areas that need to be improved or strengthened and apply this to effectively manage each item. In particular, environmental issues include reducing greenhouse gas emissions from raw material suppliers, sourcing from sustainable forests, and ensuring that environmental issues are considered from raw materials to disposal.
  • Premium framework: We have set a strategic framework that strategically position products for growth that contribute further to solving social issues, including environmental issues, and drive profits.

Climate change issues

In terms of issues related to climate change, we have established a long-term goal of zero greenhouse gas emissions by 2050, and to achieve that goal we reached the milestone in the roadmap for reducing greenhouse gas emissions toward the 2°C target ahead of schedule halfway into the Medium-term Management Plan (fiscal 2021). As a result, we have revised the roadmap to a 1.5°C target aimed at accelerating these initiatives.
We have left as is the milestone in which all purchased power in Scope 2 comes from renewable energy by 2030 but we will also focus on reducing greenhouse gas emissions with an eye to fuel conversion, targeting a 50% reduction compared to fiscal 2019.

Under the current Medium-term Management Plan, we set and promoted conversion support measures from fiscal 2020 for our energy procurement innovation phase to actively promote the conversion of electricity used at production plants to renewable energy. We are targeting a 20% conversion of energy procured to renewable energy and are starting to implement conversion support measures. With regard to fuel sources under Scope 1, we are continuously promoting efficiency improvements by renewing aging equipment, converting power source to electricity, and continuous energy saving activities at production sites.

Water-related risk issues

In fiscal 2020, we set the goal to realize societies with abundant access to clean water as our 2050 goal, backcasted milestones in priority areas, and formulated a roadmap for water-related risks reduction. Based on this for issues related to water-related risks, we are focused not only on continuing to reduce the amount of water used on a Groupwide basis and promoting the recycling of water, but also on working to improve quality of water, based on COD indicators discharged into watersheds. In addition, SEKISUI CHEMICAL Group aims to better understand water-related risks specific to a given area and is committed to formulating and implementing measures for high-risk businesses to reduce water-related risks in each of their respective operating regions.
Through these efforts, we will work to improve aquatic environments in watersheds centered on production sites and reduce water-related risks in the supply chain, thereby lowering water-related risks to companies and society.

Resource recycling issues

As far as the recycling of resources is concerned, while focused on reducing the amount of waste generated even as we aim to double our businesses by 2030, we will also promote initiatives emphasizing recycling with the aim of realizing a circular economy and a recycling-based society in 2050. Recognizing that resource recycling efforts in the supply chain are essential to achieving a decarbonized society, in fiscal 2021 we formulated a resource recycling policy, strategy, and roadmap to achieve a circular economy in 2050.

Positioning innovation as central to creating products that contribute to sustainability for resource recycling, we have begun to strengthen our efforts to convert raw materials for existing products and recycle waste generated in the production process into valuable materials.
As technologies that accelerate resource recycling that extends beyond the Company to society at large, we are currently conducting pilot projects relating to Bio-Refinery (BR) technologies that can use microorganisms to produce ethanol from waste and are proceeding toward their business implementation.
We believe that the solution of environmental issues will be accelerated if the entire supply chain works as one. More than ever, we will develop measures and carry out activities with an emphasis on supply chain management throughout the product life cycle.

Environmental Medium- to Long-term Plan and Fiscal 2022 Results, Next Environmental Medium-term Plan Target

✔: FY2022 target achieved ×: FY2022 target not achieved

Initiatives Goals Indicators Base Year Medium-to Long-term Targets Targets and Results for FY2022 Targets
Medium-term Management Plan Targets
(FY2020~FY2022)
FY2030 Targets FY2050 Targets FY2022 Targets FY2022 Results Selfevaluation Reference Page Domestic (Japan) Production Sites Research Facilities Domestic (Japan) Offices Overseas Production Sites Overseas Offices Other
Rate of return to natural and social capital Achieving an “Earth with Maintained Biodiversity” through corporate activities Sekisui Environment Sustainability Index Rate of return to natural capital Maintain 100% or more Maintain 100% or more 127.3% Detail
Products to enhance sustainability Improve economic value Maximize value (social and economic) Sales of products to enhance sustainability (growth rate (compared with 2019)) 800.0 billion yen Expand sales of products that solve issues Drive sustainable corporate growth thorough products and service which improve environmental and social sustainability. 800.0 billion yen 908.9 billion yen Detail            
Number of new registered products 6 per year 6 per year 18 per year Detail            
Reduce environmental impact GHG Decarbonization: Zero GHG emissions Renewable energy ratio of purchased electricity (including solar power generation for in-house use) 20% 100% Maintain 100% 20% 36.4% Detail
GHG emissions FY2013 -9% -26% -100% -9% -26.8% Detail
Reduce energy usage volume Improve energy efficiency and reduce energy expenses during production Energy consumption per unit of production FY2019 -3% -10% -3% -1.1% × Detail        
Resource circulation Promotion of resource reuse Waste generated per unit of production FY2019 Decrease of waste generated per unit of production: 1% over a 3-year period Achieve a circular economy Decrease of waste generated per unit of production: 1% over a 3-year period -1.7% Detail        
Copier paper use per unit of production FY2019 -3% -3% -39.0% Detail        
Amount of waste generated per building at new housing construction sites FY2019 -6% -6% -8.9% Detail          
Water-related risks Maintain water resources Water intake volume at production sites which use large quantities of water FY2016 -10% -10%
(three-year Medium-term Management Plan)
-7.8% × Detail          
Total COD volume of river discharge water at production sites with large COD emission volumes FY2016 -10% -10%
(Three-year Medium-term Management Plan)
-14.3% Detail          
Reduce the impact of chemical substances Reduce chemical emission and transport volumes VOC emissions (Japan) FY2019 -3% -3% -17.1% Detail          
Ecosystem Ecosystem impact: Minimize risks of ecosystem deterioration JBIB Land Use Score Card® points FY2019 +3 points over a 3-year period Promote ecosystem consideration*at all business sites *Ecosystem consideration: Increased quantitative evaluation of biodiversity Maintain ecosystem consideration at all business sites +3 points over a 3-year
period
+4.9 points Detail        
Education and development Enhancing the ability to contribute to the resolution of social issues through education Improve employees’ ability to contribute to solving social problems (employee education) Problem-solving capability indicators for personnel FY2020 Implement education and human resource index checking to develop the skills needed by human resources with excellent problem-solving abilities (ESG human resources). Achieve FY2020 benchmarks and set goal values. Level up as human resources with excellent problem-solving ability Take a leading role in society as human resources with excellent problem-solving ability 51 points
(Benchmark + 10 points)
39 points × Detail      

Next Environmental Medium- term Plan "Environment Sustainability Plan EXTEND" Target (Fiscal 2023-2025)

Initiatives Goals Level Setting Guidelines Indicators
Red: Public Targets
Black: Monitoring Items
Base
Year
FY2023 Targets FY2024 Targets FY2025 Targets FY2030 Targets FY2050 Targets Targets
Domestic (Japan) Production Sites Research Facilities Domestic (Japan) Offices Overseas Production Sites Overseas Offices Other
Progress management through the Integrated Index Achieving an “Earth with Maintained Biodiversity” through corporate activities Environmental returns that exceed environmental impact Sekisui Environmental Sustainability Index Return to natural capital rate Maintain 100% or more Maintain 100% or more Maintain 100% or more Maintain 100% or more Maintain 100% or more
Products to enhance sustainability TOTAL Balance between economic value and social value Double the Group’s business by 2030 Net sales of products to enhance sustainability 960.0 billion yen Over 1 trillion yen            
By major environmental issue Contribution to the promotion of resource reuse (particularly carbon) Realization of recycling-based society Increased net sales of products that contribute to resource recycling FY2020
55.3 billion yen
1.6 times
(88.5 billion yen)
1.65 times
(91.2 billion yen)
1.7 times
(94.0 billion yen)
Double or more
(110.6 billion yen)
All products            
Net sales of products derived from nonfossil fuel sources and use recycled materials FY2019
3.0 billion yen
38.0 billion yen 39.0 billion yen 40.0 billion yen 100.0 billion yen            
Reduce environmental impact GHG Decarbonization
Zero GHG emissions
The Paris Agreement 1.5°C target
Realization of decarbonized society
GHG emission reduction rate FY2019 -26% -30% -33% -50% -100%  
Renewable energy ratio of purchased electricity 50% 60% 70% 100% Total power consumption including co-generation 100%  
Fuel-source GHG emission reduction rate (including GHGs not arising from energy consumption) FY2019 -10% -10% -12% -11% -100%  
Reduce energy usage volume Improve efficiency of energy usage of during manufacturing and reduce energy costs Cost reductions above cost increases from purchasing renewable energy Reduction rate of energy consumption per unit of production FY2022 -1% -2% -3%        
Resource Recycling Promotion of resource reuse (particularly carbon) Realization of recycling-based society Issue of marine plastics Reduction rate of amount of waste generated per unit of production FY2022 -1% -2% -3% Achieve a circular economy        
Recycling rate for waste plastic materials Japan; 61% (Overseas; base acquisition) Japan; 63% (Overseas; base+3%) Japan; 65% (Overseas; base+5%) 100% 100%      
Reduce the amount of resources used at office Reduction rate of copier paper use per unit of production FY2022 -1% -2% -3% Achieve a circular economy        
Reduce Waste Generated by Construction Sites of New Housing Reduction rate of amount of waste generated per building at new housing construction sites FY2022 -4% -8% -12% Achieve a circular economy          
Water-related risks Mimimizing business impact by water-related risks Contributing to solving watershed-specific water issues" Sustainable operation is possible Contributing return to natural capital Implementing measures to minimize the business impact of water-related risks specific to five sites in Japan and overseas Efforts to minimize business impact at individual sites with large business impact Minimum impact to environment where water-related risks exist Minimizing water risk in all the areas        
Maintain water resources Does not increase water stress in watersheds Reduction rate of water intake volume at production sites which use large quantities of water FY2016 -10% over a 3-year period          
Do not increase impact on watersheds Reduction rate of Total COD volume of river discharge water at production sites with large COD emission volumes FY2016 -10% over a 3-year period          
Ecosystem Ecosystem impact: Minimize risks of ecosystem deterioration Biodiversity Conservation JBIB Land Use Score Card® Evaluation Points FY2022 +3 points over a 3-year period Promote ecosystem friendliness at all business sites Promote ecosystem friendliness at all business sites        

Fiscal 2022 Results for Crucial Items

Creating and expanding the market for products to enhance sustainability

In fiscal 2022, we newly registered 18 products and services. Examples of products that help solve new resource recycling issues include:

  • Exterior wall renovation coating that extends the life of homes
  • Low-temperature degradable plastic that allows less use of rare earth minerals that leads to the promotion of EVs that contribute to solving climate change issues
  • Anticorrosion tape that renews infrastructure through a dry process and longer lifespans

Solving climate change issues

  • Products that reduce greenhouse gas emissions in the process from raw materials:
    Sales of “industrial piping” and products that support functional improvements necessary for the evolution of 5G have also increased in response to the growing demand for low-carbon and decarbonization. These, too, contribute to the overall increase in sales of products to enhance sustainability.

<Quantification of the Contribution Effect on Solving Issues through Products>
In fiscal 2022, we identified environmental values from products equivalent to 50% of products to enhance sustainability.
Regarding returns and value of social capital, we are also looking into engaging in economic value conversion that utilizes an impact accounting method.
The Group will leverage the visualized environmental and social values (degree of contribution on solving issues) of products and lines of business, releasing information and enlightening society, and will also step up its activities that allow it to receive feedback about its business.

Reducing Environmental Impact

GHG emissions:
Accelerated reductions through the effects of converting purchased power to renewable energy sources.
Energy savings:
Reduction in energy consumption per unit of production owed to the recovery in production volume.

Amount of waste generated:
Japan:
Continued reduction in the amount of waste by allowing the re-use of scrap generated as part of the production process for high-performance resin products as well as a reduction in per unit of production owing to the recovery in production volume.
Overseas:
Continued reduction in the amount of waste at UIEP Company business sites

Going forward, we will not only reduce the amount of waste generated in the production process, but also work to advance the recycling of waste and products, while simultaneously promoting the use of recycled resources in order to achieve a truly circular economy.

Environmental Conservation

SDGs Contribution Activities*
With regard to social contribution activities, such as environmental conservation and nurturing of the next generation, which have been carried out mainly by business sites or employees, recommendations advocate a change in consciousness toward awareness of SDGs during the undertaking of activities while continuing conventional endeavors.
The objectives of conventional activities becomes clear by considering which social issues to focus on and why to work on solving those social issues, centered on the SDGs, and expect that activities will be reviewed and effects will further improve.

Integrated Index Sekisui Environment Sustainability Index

Rates of return to natural and social capital

Integrated Index Sekisui Environment Sustainability Index

The Sekisui Environment Sustainability Index reflects the impact on the environment of the activities of SEKISUI CHEMICAL Group companies (the use of natural and social capital) and their degree of contribution to the environment (returns to natural and social capital) as a single indicator.
We have gradually expanded our scope of coverage and awareness of the impact and returns not only on natural capital but also social capital.
The major items for implementation in the Environmental Medium-term Plan - reducing various impacts on the environment, expanding products and services that contribute to the natural and social environments, conserving the environment, and so forth - were integrated into this indicator; the Group has been running preliminary calculations (established in fiscal 2013) since fiscal 2014. From fiscal 2017, this index is being used to monitor the overall progress of Group companies’ environmental management.
As far as the Environmental Medium-term Plan from 2020 is concerned, the Group is evaluating its impact on and contribution to not only the natural environment but also the social environment while declaring its intention to contribute to the return of natural and social capital for its Sekisui Environment Sustainability Index.
In 2050, even as we expand our business, we will promote ESG management while maintaining a return of 100% or higher for both natural capital as well as social capital.

Calculation Results

The results of calculating the Sekisui Environment Sustainability Index, utilizing results from fiscal 2022, are as follows. Setting the use of natural and social capital (the impact on natural and social environment) at 100, the return of natural and social capital (contributions to natural and social environment) was 127.3% (a 9.6 percentage point increase over the 117.7% achieved in fiscal 2021).

Trends in the return rate are analyzed as follows.

  • (1)
    Regarding the use (impact) of natural and social capital
    A reduction in the amount of impact is considered to have been made through progress in the conversion of purchased electricity to renewable energy.
  • (2)
    Regarding the return (contributions) of natural and social capital
    The returns (contributions) due to products to enhance sustainability are steadily increasing. From an environmental conservation activity perspective, while the implementation and content of activities had been limited due to various policies, including efforts to address the further spread of COVID-19 at business sites, the Group’ contributions are increasing as conditions gradually become conducive to activities.

Going forward, we will maintain the rate of return to natural and social capital at 100% or higher while growing the company and expanding our businesses. By 2050, we aim to realize the sustainable use of the earth’s natural capital and the social capital generated by human society.

In this index, promoting solving issues by means of products will contribute to improving the sustainability of the earth and society. We also believe that bringing about improvements in the returns on natural and social capital will link to improvements in the sustainability of SEKISUI CHEMICAL Group and its products.

  • 11-05

After compiling the raw data in (1) above, the damage calculation-based impact assessment method LIME2, developed for use in Japan by Professor Norihiro Itsubo of WASEDA University, was employed for the calculations in stages (2) and (3).
The LCA database IDEA has been updated from ver. 2.3 to ver. 3.1 in the calculation system MiLCA, which uses LIME 2 to calculate the rate of return. We will use the upgraded MiLCA 3.1 from the next medium-term plan.
In MiLCA 3.1, the ascertained data shows that the environmental impact per unit amount is larger, especially in terms of the impact of chemical substances on ecosystems.
Under the Medium-term Management Plan starting from fiscal 2023, we will place even more importance on the impact on biodiversity, and promote activities aimed at shifting from negative to positive aspects. We have determined that our approach is consistent with the direction MiLCA 3.1 upgrades We will reconfirm the status of current conditions by utilizing the updated calculation system and continue to confirm the progress of activities aimed at addressing environmental issues based on the rate of return from fiscal 2023.

  • Note:
    Based on this approach, recalculation yields a rate of return on natural and social capital of 127.3% (using MiLCA ver. 2.1) for fiscal 2022 and a rate of return on natural and social capital of 97.6% (using MiLCA ver. 3.1) for fiscal 2022.
Indicator Calculation Method
Sekisui Environment Sustainability Index Sekisui Environment Sustainability Index = Group-wide amount of natural and social capital returned / Group-wide amount of natural and social capital used
Calculating the amount of natural and social capital used and the amount of natural and social capital returned
Employing LIME 2 (a damage calculation-based impact assessment method developed for use in Japan by Professor Norihiro Itsubo of WASEDA University) and covering all the four criteria for conservation defined by LIME 2, 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 on growth), and the effects on life (restricting the extinction of living species) were evaluated and then made into a single indicator.
The amount of return to natural and social capital is calculated assuming that the risk of damage to natural capital has been reduced by various environmental contribution efforts of the entire group compared to the case without such efforts.
  • Items included in the amount of natural and social capital used
    • Direct use:
      Use of land, greenhouse gases, amounts of emissions into the air of PRTR substances and air pollutants, the COD discharged into bodies of water
    • Indirect use:
      Purchased raw materials*1, energy use, water intake volume, amount of waste material emitted, amount of GHGs emitted indirectly in supply chains (Scope 3)
  • Items included in returns to natural and social capital
    Amount of contributions to reducing use of natural capital through products to enhance sustainability, the amount of contribution from environmental conservation activities, environment-related donations, mega-solar (solar farms that produce over 1,000 kilowatts (1 megawatt) of energy each year) power generation output
  • *1
    Until fiscal 2017, the Group gained an understanding of environmental impact, including the volume of greenhouse gasses emitted, by making calculations using MiLCA, the database provided by the Japan Environmental Management Association For Industry. However, from fiscal 2018, the Group is reflecting the actual GHG emissions of its raw material suppliers with regard to four principal resins (PP, PE, PVC and PVA).
Scope of Calculation / Listing by category of calculation: Estimated 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 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 use are included in the calculation based on the 30-year period after the purchase of the land
  • *2
    Concerning land use, starting with fiscal 2017, improvements to land quality in the JBIB Land Use Score Card® system promoted in Japan were deemed as reductions of the impact of land use, 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 use for 60 years into the future. Until fiscal 2017, the Group calculated the amount of greenhouse gas reduction achieved through solar power generation as the amount of reduced environmental impact. From fiscal 2018, however, we are also calculating the effect of reduction in energy used in residences built to net net zero energy house (ZEH) specifications.
    Processing of sold products: Energy use by customers while processing our 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, use/maintenance, disposal/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*3 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 amount 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 was performed on the effects of products equivalent to around 52% of products to enhance sustainability.
*3 Based on individual standards of the divisional companies
・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 2016 × (revenue in that fiscal year / revenue in fiscal 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 coefficient 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. Regarding activities in cooperation with local communities which were promoted in Japan, because improving the sustainability of activities through local cooperation and making them conduct the activities on their own (autonomous) were made targets from fiscal 2017, the Group’s ability to work toward this target was weighted against the growth axis and included in the calculation
・Direct contributions / donations:
The amount willing to pay 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