Climate Change Initiatives

Toward Carbon Neutrality

Climate change is altering the global environment and is manifesting itself in extreme weather events, sea level rises, ecosystem changes, and other impacts that threaten people's lives and the sustainable growth of our companies. The effects of climate change are expected to be further magnified in the future as a result of ongoing warming.
To mitigate this climate change, we have established a group-wide carbon neutrality policy and are working to reduce greenhouse gas emissions. In addition, to prepare for the expected future impacts of climate change and to ensure the continuity of our business, we are working to avoid and mitigate climate change risks and increase our resilience.

SDGs

Carbon Neutrality Policy

Becoming carbon neutral is an issue of vital importance, and something we cannot avoid if we wish to achieve sustainable growth. Going forward, we will actively promote efforts to reduce our GHG emissions, and strive to help make society carbon neutral by 2050.

Reducing our own GHG emissions
We will endeavor to minimize the GHG emissions we generate as part of our production activities, while providing technologies that enable this to other companies in the Sumitomo Seika Group.
Supplying low-GHG products and environmentally friendly products
For our products and services, we plan to offer those that consider lifecycle assessments (LCA) to contribute to carbon neutrality, in order to innovatively reduce GHG emissions.
Assisting with society’s carbon cycle
We want to create a circular economy together with local communities and society as a whole, and to that end we will continuously make technical innovations to recover, use, and fix GHGs. Furthermore, by working with diverse partners, we will set ourselves the target of helping to bring about that kind of society, and we will promote efforts to that end.

Targets

Reduce Scope 1 & 2 Emissions

We aim to reduce emissions for the whole Group by 42% or more compared to FY2021 levels by 2030, and by 46% or more compared to FY2013 levels on a non-consolidated basis. We aim to be carbon neutral by 2050.

Reduce Scope 3 Emissions

Conduct life cycle assessments (LCA) for each product and continue systematic reduction efforts
Calculate carbon footprint (CFP) for each product (to be available by 2025)

Promote Technological Innovation

We will strive to help make society carbon neutral through innovation in Sumitomo Seika's products and technologies.

Develop CO₂ separation technology
Develop CO₂ recovery technology
Enhance the line-up of environmentally friendly products

Organizational Structure for Implementing Carbon Neutral Measures

Greenhouse Gas Emissions

Scope 1, 2 emissions (Group)

（kt-CO₂）
	FY2020	FY2021	FY2022
Scope1	210	192	190
Scope2	86	90	97
Total	296	282	286

Scope 1, 2 emissions (Non-consolidated)

（kt-CO₂）
	FY2020	FY2021	FY2022
Scope1	186	167	166
Scope2	21	20	19
Total	207	187	185

Scope3 emissions (Non-consolidated)

（t-CO₂）
Category	Major Emission Source (s)	FY2021	FY2022
1	Purchased Goods and Services	432,687	485,448 (Group : 1,116,611)
2	Capital Goods	5,575	12,998
3	Fuel- and Energy-Related Activities (Not Included in Scope 1 or Scope 2)	22,872	23,053
4	Upstream Transportation and Distribution	8,530	9,336
5	Waste Generated in Operations	5,263	4,496
6	Business Travel	144	144
7	Employee Commuting	674	688
8	Upstream Leased Assets	2,094	1,539

We undergo third-party verification for the calculation of GHG emissions and energy use.

FY2022
FY2021

Roadmap to Achieve Carbon Neutrality

Theoretical Scenario Analysis

Physical risks (in a +4°C world): Medium-to-long term to long term

Changes to society	Major risks	Impact	Main responses
Growing severity of climate-related disasters (Heavy rain, tropical cyclones, etc.)	Halt to operations due to water ingress High tides, high waves, flooding, etc. Supply chains could be broken	Medium	Continuously strengthen BCP measures Bolster response to climate change (high tides, high waves, flooding, etc.) Reinforce the supply chain (cooperate with suppliers via sustainable procurement policies, etc.)
Rising temperatures Water shortages or worsening water quality	Worsening working environments, dropping productivity Droughts and poorer water quality could negatively impact operations	Medium	Make continuous improvements to working environments (install air-conditioners, etc.) Understand and work to combat water stress

Transitional risks (in a +1.5°C world): Short-to-medium term to medium-to-long term

Changes to society	Major risks	Impact	Main responses
Stricter measures/regulations	Major increase in related infrastructure investments if NDC target s ar e raised and increases in technological investments Increase in costs that go along with introduction of new measures or regulations, such as for higher carbon pricing	High	Make progress with GHG emissions reductions Implement measures toward energy efficiency, process optimization, CO₂ capture, energy switching (such as introducing renewable energy), etc.
Technology	Major increase in energy costs Major increase in prices connected to moving to non-oil-based raw materials	High	Minimize energy and material consumption Streamline super absorbent polymer processes and develop recycling technologies Develop carbon recycling technologies, such as CCU
Market	Consumer behavior (moves to control environmental impact) Appearance of new rivals with new competitive angle	High	Reduce carbon footprint for each product Develop environmentally friendly products

Opportunities (limiting rise to +1.5°C): Medium to medium-to-long term

Changes to society	Major opportunities	Impact	Main responses
Phasing out of fossil fuels	Increased demand for hydrogen and biogas	High	Improve performance of PSA and expand business for hydrogen, methane, etc.
Transition to a recycling-oriented society	Demand for smaller CO₂ capture technologies could grow Increased demand for products that help reduce environmental impact, such as recycled products	High	Improve performance of PSA for CO₂ and commercialization Introduce technologies that can make CO₂ a usable resource Develop recycling technologies

Water-Related Risks

As we are in the chemicals industry, whether or not we are able to continue ensuring a stable supply of good-quality water will have a major impact on the sustainability of our business going forward. As such we believe it is highly important that we look into the types of water-related risk that face each of our production sites and consider appropriate measures to address them.

Current evaluation results

For the plants in Japan, we are aware that the likelihood of water-related risks becoming a reality is relatively low, but with global warming continuing, we recognize will rise. For production sites in coastal regions, we are continuing to evaluate risks with added information such as hazard mapping, and we will strive to ensure we can respond appropriately to any water-related risk. In the future, we will also evaluate water-related risks for the sites outside Japan.

Water stress (shortage) rating (Calculated using WRI Aqueduct)

	Baseline (current)	Forecasts (2040, RCP8.5)
Himeji Works	Low	Medium to high
Befu Works	Low	High
Chiba Works	Medium to high	Medium to high