Disclosure Based on TCFD Recommendations
Our Policy
JAE Group recognizes climate change-related issues as critical management challenge. We conduct an analysis of the risks and opportunities presented by climate change, and we strive to promote initiatives through our business activities within the aim of achieving sustainable growth.Governance
In April 2024, JAE Group established a Sustainability Promotion Committee chaired by the Chairman and comprising corporate officers and general managers of the departments relevant to sustainability management initiatives. This committee aims to advance our sustainability management initiatives. The Committee is responsible for deliberating and formulating the policies and strategies for sustainability management, as well as determining and directing specific measures for sustainability initiatives. Notably, important issues will be reported to the Management Committee and the Board of Directors as necessary, ensuring that the management team maintains an appropriate oversight framework. Significant risks arising from natural disasters associated with climate change and environmental regulations are to be deliberated by the Corporate Risk Management Committee.Strategies
Impact analysis by scenario
JAE Group has analyzed scenarios concerning climate change based on the Intergovernmental Panel on Climate Change (IPCC) Sixth Assessment Report (SSP1-1.9 (1.5°C scenario), SSP5-8.5 (4°C scenario)) and the International Energy Agency’s (IEA) World Energy Outlook 2022. Through this analysis, we have identified risks and opportunities, and assessed possible impacts on JAE Group's operation.| Possible climate futures | Possible impacts | |
|---|---|---|
| 4℃ scenario |
Regulations addressing climate change and initiatives for low-carbon are particularly weak in developing countries and insufficient even in developed countries. As a result, reduction in CO2 emissions are inadequate, leading to further progress in global warming and the expected increase in natural disasters as outlined below: ・Rising sea levels due to melting of glaciers and polar ice. ・Floods cause by extreme rainfall and large typhoons. ・Droughts, water shortages, and decreases in groundwater levels due to insufficient rainfall. |
・The intensification of natural disasters may lead to factory shutdowns and disruptions in supply chain, thereby affecting production, logistics, and society as a whole. ・Efforts to reduce CO2 emissions are not progressing, particularly in emerging countries, resulting in the continuation of fossil fuel-consuming businesses. |
| 1.5℃ scenario |
Efforts toward decarbonization are being actively pursued on a global scale, leading to widespread initiatives that significantly advance the reduction of CO2 emissions. Consequently, it is anticipated that the progress of global warming will be mitigated, resulting of the following outcomes. ・The implementation of stringent regulations such as carbon taxes. ・A reduction in temperature rise compared to current levels, with a limited increase in the frequency of natural disasters. |
・The introduction of carbon taxes and proliferation of clean energy will lead to a sharp increase in energy prices including electricity, as well as rising cost for raw materials affecting the procurement of components. ・There will be heightened demands from society and customers for CO2 reductions, which may impact business operation if not adequately addressed. ・The demand for fossil fuels related businesses is expected to decline. ・Investments in renewable energy and energy-efficient technologies will increase, stimulating research & development and product innovation in these areas. |
Risks and Opportunities
| Risks and Opportunities | Description | Term | Impact | Countermeasures | ||
|---|---|---|---|---|---|---|
| Risks | Transition risks (1.5℃) |
Policy and Regulation risks |
Increased costs due to strengthened laws and regulations on CO2 emissions and energy use, such as carbon taxes | Medium to long term | High | Promotion of various energy-saving initiatives |
| Technology and Market risks |
A decline in market share due to delays developing new products aimed at a decarbonized society and responding to market needs | Medium to long term | High | Development of new products and business transformation geared towards decarbonization | ||
| Reputation risks |
A decline in stakeholder evaluation due to delays in addressing climate change initiatives, resulting in lost business opportunities, and a decrease in corporate value | Short to medium term | Medium | Strengthen efforts for sustainability management | ||
| Physical risks (4℃) |
Acute risks |
Suspension of factory operations and disruption of supply chain due to intensified natural disasters such as typhoons and floods | Short to long term | High | Strengthen business continuity plans | |
| Chronic risks |
Increase in air conditioning costs due to the permanence of rising temperatures | Long term | High | Introduction of highly-efficiency facilities and equipment | ||
| Opportunities （1.5℃） | Resource efficiency |
Expansion of market demands associated with the transition to a circular economy | Medium to long term | Medium | Development of products that accommodate material saving, recycling, and reuse | |
| Energy source | Utilization of energy sources contributing to decarbonization, and efficiency of energy use | Short to long term | Low | Utilization of renewable energy and development of energy-saving equipment | ||
| Products, services, markets |
Development of products contributing to decarbonization and expansion of sales | Short to long term | High | Development of new products aimed at decarbonization and business transformation | ||
* The level of impact is assessed considering both occurrence frequency and financial implications.
Risk Management
JAE Group has established a Corporate Risk Management Committee, chaired by the Chairman, comprising corporate officers and general managers of departments as committee members with a full-time Auditors serving as observers. The Committee identifies, evaluates, monitors, and manages risks that may hinder the sustainable growth of our Group. With respect to particularly important matters, reports are provided to the Management Committee and the Board of Directors as necessary, ensuring that the management team is appropriately informed of and supervises the overall risks management status of the company.In the event of large-scale natural disaster caused by climate change that impedes the business continuity, we will promptly establish a Central Task Force, headed by the President, in accordance with our business continuity plan. This framework allows us to develop and implement measures and directives for effective response.
Targets and Goals
・JAE Group recognizes climate change measures as an urgent priority, aiming for carbon neutrality by fiscal 2050.・In our approach to reducing greenhouse gas emissions, we promote energy-saving initiatives such as enhancing the efficiency of facilities and equipment, and converting lighting to LED, which will help minimize electricity purchase. Any shortfall will be addressed through in-house power generation and a transition to electricity derived from renewable energy sources.
・Following the achievement of our previous targets, we have set a revised target for the total greenhouse gas emissions reduction towards fiscal 2030. The goal is to reduce total greenhouse gas emissions (Scope 1 and 2) by 75% compared to fiscal 2017, based on our global production. Additionally, we will strive to advance the timeline for achieving carbon neutrality as much as possible.
* Global production basis: Focused on major production companies
・ For Scope 3
JAE Group acknowledge the importance of reducing Scope 3 emissions. We will continue our collaborative efforts with suppliers to achieve reductions and are considering the establishment of specific reduction targets moving forward