※ TCFD stands for the Task Force on Climate-related Financial Disclosures. The TCFD was established by the Financial Stability Board at the request of the G20 to discuss how climate-related information disclosures and financial institutions’ responses should be.
Responding to climate-related risks and opportunities is one of the key ESG issues we should tackle with concerted group-wide efforts. Based on this recognition, we have established a Sustainability Committee (which meets at least twice a year) as an advisory body to the Representative Director & President for the purpose of promoting sustainability management, including the deliberation and determination of basic policies and necessary matters relating to such responses.
The Sustainability Committee holds meetings attended by directors in charge of the main divisions and conducts the planning of measures to address climate-related issues,management of progress toward targets, materiality assessment of risks, priority setting, and the determination of response measures to be taken before making reports and recommendations to the Representative Director & President. We have also established a Risk Committee within the Sustainability Committee as a body to manage relevant risks and execute tasks in accordance with the instructions of the Sustainability Committee.
The Sustainability Committee is supervised by the Board of Directors, which receives reports and issues instructions as necessary on important matters deliberated by the Committee to ensure that its decisions are free from errors.
We have assessed risks and opportunities that may have an impact on the SUGI Pharmacy Group in reference to, among others, the 1.5°C and 4°C scenarios identified in the IPCC’s Fifth Assessment Report, the IEA WEO NZE scenario, etc., after collecting various parameters based on future forecasts.
Item | 2030 |
---|---|
CO2 emissions under the assumption of no positive action | 225,689 |
Emissions when 50% reduction in CO2 emissions per store from FY 2014 has been achieved | 141,890 |
*An emission factor of 0.000433 (t-CO2/kWh; national average factor for FY 2022) was used.
*A net increase of 100 per year in the number of stores is assumed.
*Electric power consumption at most recently opened stores was used. (Electric power consumption is higher at these stores.)
Business: Drugstore business in Japan
Scope: Stores, procurement, logistics, and consumer behavior
Period: Present through 2030
We expect that various transition risks will increase. In this scenario, we expect that countermeasures against climate-related issues will be strengthened and decarbonization will progress. As a result, we expect increases in expenditure due to the introduction and higher rates of carbon taxes and the widespread use of renewable energy.
We expect that physical risks, such as extreme weather, will increase. We expect damage to store operations due to the frequency and intensification of natural disasters caused by climate change. As a result, we expect increases in expenditure for repairs and decreases in sales due to temporary store closures.
We expect that changes in consumer preferences and behavior will be influenced by temperature rises. If we are unable to develop and display products that meet customer needs or effectively market services that meet customer needs, opportunity losses may arise. On the other hand, we could take advantage of increases in opportunities if we can capture such needs.
Category | Assessment | |||
---|---|---|---|---|
Assessment in the world of +1.5°C | Assessment in the world of +4°C | |||
Transition risks and opportunities | Policies and regulations | Carbon pricing | Risk: Expenditure will increase following the introduction of carbon pricing. |
Risk: The impact of carbon pricing will be limited. |
Risk: Expenditure will increase due to increases in production and procurement costs of products and services throughout the supply chain. |
||||
Control of CFCs |
Risk: Expenditure will increase due to the introduction of CFC-free equipment at stores. |
ー | ||
Technology | Logistics efficiency | Opportunity: Expenditure will decrease as a result of more efficient logistics. | ||
Market | Electricity prices | Risk: Expenditure will increase due to rises in electricity prices. | ||
Reputation | Customer preferences | Risk: Sales will decrease due to a delay in the provision of eco-friendly products and services. Opportunity: Sales will increase as we develop private brand products that meet the needs for sustainable consumption. | Opportunity: Sales will increase as we develop private brand products that meet the needs for sustainable consumption. | |
EV charging | Opportunity: The frequency of visits to stores will increase as we enhance the charging environment. | ー | ||
Physical risks and opportunities | Acute | Drastic increases in extreme weather | Risk: Sales will decrease to a limited extent due to temporary store closures and lower customer traffic. | Risk: Sales will decrease significantly due to increases in temporary store closures and lower customer traffic caused by physical damage to stores. |
ー | Risk: Expenditure will increase as insurance premiums increase in response to increases in natural disasters. | |||
Opportunity: Sales of disaster prevention and stockpiling-related products will increase. |
Opportunity: Sales of disaster prevention and stockpiling-related products will increase.
Risk: Repair expenses will increase due to physical damage to stores. |
|||
Chronic | Average temperature | Risk: AC-related expenditure will increase as the temperature rises. | Risk: AC-related expenditure will increase as the temperature rises. | |
Production and procurement | ー | Risk: Expenditure will increase as purchase costs increase due to lower production of raw materials. |
Trial calculation of the impact when 50% reduction in CO2 emission from FY 2014 is achieved in 2030. The amount of carbon taxes in 2030 is expected to be approximately 2.7 billion yen.
Item | Business impact |
---|---|
Amount of carbon taxes in 2030 | Approx. 2.7billion yen |
※ In reference to IEA WEO2022 NZE (1.5°C) P465 Table B.2, the amount of carbon taxes in 2030 was set at 140 dollars/t-CO2.
※ The trial calculation is based on the USD/JPY exchange rate as of March 1, 2023.
The SUGI Pharmacy Group will implement the following measures to be able to create a sustainable society not only for society but also for the Group itself.
Energy saving measures
Energy creation measures
Other measures to reduce CO2 emissions
CO2 emission per store reduction targets | |
---|---|
FY 2030 | 50% reduction from FY 2014 |
FY 2050 | Net zero |
FY | FY 2015 | FY 2016 | FY 2017 | FY 2018 |
---|---|---|---|---|
No. of stores | 996 | 1,048 | 1,105 | 1,190 |
Emissions (t-CO2) | 123,377 | 129,392 | 119,826 | 120,826 |
Average per store (t-CO2) | 123.9 | 123.5 | 108.4 | 101.5 |
FY | FY 2019 |
FY 2020 |
FY 2021 |
FY 2022 |
FY 2023 |
---|---|---|---|---|---|
No. of stores | 1,283 | 1,391 | 1,483 | 1,565 | 1,718 |
Emissions (t-CO2) | 117,611 | 126,160 | 135,149 | 138,416 | To be calculated |
Average per store (t-CO2) | 91.7 | 90.7 | 91.1 | 88.4 | To be calculated |
※ A location-based emission factor (national average emission factor by electric power company) is used.
※CO2 emissions based on the use of gasoline by company cars are calculated on a trial basis based on the pro rata allocation of FY 2020 results using the number of stores (in and before FY 2020).
※CO2 emissions shown in the table above are Scope 1 and 2 emissions (emissions from the Group).
※Calculation logics for tenant shops and some offices are currently under close examination.
*Categories 9 through 11 and 13 through 15 are not applicable or items that have not been calculated.
*Category 4 is an estimate calculated based on monthly data for a 12-month period.
*Figures and calculation logics of all categories are currently under close examination.