Environmental Accounting

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Materiality Topics:Environment
Major Initiatives
Other Initiatives to Reduce Environmental Impact
Environmental Accounting

Performance Data

SEKISUI CHEMICAL Group Refers to Public Guidelines and Adds Its Own Concepts

From an ESG management perspective, and in order to fulfill our reporting responsibilities as a company and promote efficient environmental activities, we are working to reduce our environmental impact while employing environmental accounting in a bid to identify the effects of costs incurred and investments undertaken to contribute to the environment. Under the current Medium-term Management Plan, which began in fiscal 2020, and from a Group-wide management strategy perspective, environment-related investments and expenses are positioned as a capital cost. We will use environmental accounting to raise awareness that the restraint of capital costs and efforts to improve productivity will help boost ROIC.

Performance Data

Summation period	April 1, 2022 to March 31, 2023
Scope of summation	Production sites, research facilities, housing sales company sites, and Corporate Headquarters departments in Japan.
Calculation Method	Based on the Ministry of the Environment’s Environmental Accounting Guidelines 2005 Edition
Approach toward summation	Depreciation and amortization are excluded from environmental conservation costs because they overlap with investment costs. Investment amounts are based on budget approvals during the summation period. Expenditures and investments that contain other than environmental conservation activities are distributed pro-rata in 10% increments. Disclosure categories have been revised, environmental conservation costs are subcategorized, and the economic effects of environmental conservation measures are limited to effects on an actual basis, excluding deemed effects from fiscal 2020. The environmental conservation effects of physical quantity are shown in environmental performance data disclosed in Major Initiatives.

Environmental Conservation Costs

(Millions of yen)
Items			FY2020		FY2021		FY2022
Category	Description of main activities		Costs	Investments	Costs	Investments	Costs	Investments
1) Costs within business areas	(1) Pollution prevention costs	a. Air	369	62	319	98	355	16
		b. Water	130	77	85	68	110	198
		c. Soil	0	7	0	4	0	7
		d. Noise	12	1	1	0	2	0
		e. Vibration	0	0	0	0	0	0
		f. Odor	255	0	242	4	235	0
		g. Ground	106	3	105	0	102	0
		h. Others	304	8	307	29	315	5
		Subtotal	1,176	157	1,058	202	1,118	226
	(2) Countermeasures against global warming	a. Global warming (including energy saving)	686	588	114	833	132	510
		b. Ozone layer	100	18	6	33	6	4
		c. Others	0	4	0	55	0	14
		Subtotal	786	611	120	921	138	528
	(3) Resource recycling costs	a. Effective utilization of resources	63	17	6	31	10	12
		b. Water conservation, utilization of rainwater, etc.	4	4	7	28	8	6
		c. Waste volume lightening, reduction, recycling, etc.	176	93	177	76	180	362
		d. Waste processing, disposal, etc.	6,293	4	6,477	106	4,878	1
		e. Others	18	1	1	6	19	14
		Subtotal	6,553	119	6,668	246	5,095	394
2) Upstream/downstream costs	Cost increases due to recycling of products such as those manufactured and sold, greener purchasing, etc.		113	0	109	28	161	0
3) Administrative costs	Environmental education, EMS certification, running costs for green action organization, information disclosure, etc.		2,385	12	2,206	1	1,624	2
4) Research & development costs	Research and development on environmental conservation		3,740	313	15,009	813	16,128	760
5) Social activities costs	Social contributions, etc.		112	98	78	0	128	0
6) Environmental damage costs	Nature restoration, etc.		30	2	57	5	63	8
Total			14,896	1,311	25,306	2,216	24,455	1,918

Substantive Economic Effects of Environmental Conservation Measures

(Millions of yen)
Description of effects		FY2020	FY2021	FY2022	Remarks
Revenue	(1) Profit on sales of valuable waste resources	176	139	116	Profit on sales of valuable waste resources from promotion of waste segregation and recycling
Revenue	(2) Revenues from sale of electricity	402	334	348	Revenues from sale of electricity generated by megasolar facilities
Cost savings	(3) Cost savings through energy-saving activities	1,311	256	420	Including savings through utilization of co-generation
Cost savings	(4) Cost savings through waste-reduction activities, etc.	502	463	522	Reductions through optimization, reuse, and zero emissions activities
Total		2,392	1,191	1,407