We established a Sustainability Committee (chaired by the Representative President) as a forum to examine and discuss the Group's basic sustainability policies, material issues, and related concerns. Depending on the topic discussed, a subcommittee is formed that meets with the heads of business divisions to discuss the Group's sustainability issues in a cross-sectional way, with the content of the discussions being reported to the Board of Directors.
Sustainability issues related to climate change are discussed by the Climate Change Working Group, which is led by the Sustainability Committee Secretariat. The contents of discussions are reported to the Sustainability Committee, which deliberates on them and makes decisions.
Decisions from the Sustainability Committee are submitted to the Board of Directors, and after their deliberation and resolutions, these decisions are shared with the departments and subsidiaries, then reflected in respective management plans and business operations.
Strategy
We consider climate change to be one of the medium- to long-term risks faced by the Kibun Group, so we are considering our strategy and organizational resilience in light of the associated risks as well as possible opportunities.
We conducted a scenario analysis, focusing on the Kibun Group’s domestic food business segment, that is guided by the climate change scenarios published by the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC). The table below shows the business impact expected by the years 2030 and 2050.
The identified risks and opportunities will be reflected and addressed in the Group's strategies.
＜2℃ scenario＞
| Cause | Change | Risk / Opportunity |
Business Impact | Evaluation |
| Adoption of carbon tax | Increasing purchasing costs | Risk |
・A carbon tax could increase purchasing costs, such as surimi fish paste and packaging materials. | High |
|---|---|---|---|---|
| Increasing operating costs | Risk |
・A carbon tax on CO2 emissions during manufacturing could increase operating costs. | High | |
Improving production efficiency by installing lower energy equipment |
Opportunity | ・Lower energy consumption through aggressive investment in energy-efficient equipment could reduce the impact of a carbon tax and make production more efficient. | Medium | |
| Using of renewable energy | Increasing electricity costs | Risk |
・Increasing the percentage of renewable energy to reduce greenhouse gas emissions could increase electricity costs. | Low |
| Increasing environmental awareness | Increasing possibility of business expansion | Opportunity | ・Our promotion of decarbonization could lead to stronger cooperation with business partners and the growth of business with other industries. | Medium |
| Increasing demands for processed marine products | Opportunity | ・Demand for processed marine products could go up as consumer preferences shift from meat, a major source of greenhouse gas emissions, to marine resources. | Medium |
< Main Actions to Be Taken >
The main actions for countering risks and capitalizing on opportunities:
・Reduce energy consumption by boosting efficiency of production
・Adopt renewable energy, green power, biomass fuels, etc.
・Use packaging materials with low environmental impact
・Flexibly revise investment plans in line with environmental policies and new technologies
＜4℃ scenario＞
| Cause | Change | Risk / Opportunity |
Business Impact | Evaluation |
| Intensification of climate disasters | Increasing risks of supply chain disruption | Risk | ・Supply chains could be disrupted if suppliers, business partners, vendors, etc. are affected by a disaster, resulting in shutdowns, disruptions to store operations, etc. | High |
|---|---|---|---|---|
| Various impacts on business operations due to chronic climate change
|
Risk | ・Our factories and headquarters could be damaged by natural disasters such as heavy rain and flooding, resulting in shutdowns. | High | |
| Risk | ・Quality and hygiene risks could increase due to a dramatic increase in days when the temperature is 30℃ (86℉) or more. | High | ||
| Rising average temperatures in the fall and winter months | Rising average temperatures in the fall and winter months |
Risk | ・Rising average temperatures in the fall and winter months could cause sales of oden and nabe-related products, a major source of earnings for Kibun, to decline, resulting in lower revenues. | High |
| Increasing in extremely hot days | Increasing revenue from products that are in high demand as temperatures rise | Opportunity | ・Since cooking at home is less popular on days when the temperature reaches 30℃ (86℉), demand for products that are easy to prepare, such as Sugar-Free Noodles and crab-flavored seafood, could increase, leading to higher revenues. | Medium |
< Main Actions to Be Taken >
The main actions for countering risks and capitalizing on opportunities:
・Diversify the sources of raw materials and create multiple purchasing channels and transportation routes
・Calculate optimal inventory levels
・Promote R&D to introduce substitutes for surimi
・Strengthen countermeasures for flood damage to our factories (for example., implement flood prevention and ways to reduce flood damage)
・Improve quality control standards by acquiring hygiene certifications
・Strengthen hygiene and employee health management at Kibun, suppliers, and partner companies
・In the fall and winter, promote uses for fish paste products other than oden and nabe
・Develop new product categories
・Promote products with year-round demand
・Develop businesses in areas that are less subject to seasonal fluctuations (for example, overseas food businesses)
・Create products that require less time for cooking and strengthen their appeal
※1 2℃ scenario : A scenario in which aggressive measures are taken to minimize the rise in average temperatures, resulting in tightened regulations and changes in the market
※2 4℃ scenario : A scenario in which an increase in average temperature results in physical impacts such as extreme weather
Risk Management
Based on the scenario analysis done by the Climate Change Working Group, we have prioritized possible climate-related risks and opportunities based on their likelihood of occurrence and impact. As a result, we will focus on the most important issues, and the Sustainability Committee will manage the analysis of the risks, then formulate and promote countermeasures, and manage progress.
The content of the Sustainability Committee's analysis and deliberations is reported to the Board of Directors, and integrated into Company-wide risk management.
Metrics and Targets
We set total greenhouse gas emissions as an indicator to evaluate and manage the impact of climate-related issues on our operations.
We set a greenhouse gas reduction target of a 30% for total CO2 emissions by 2030 (compared with fiscal 2013).