Mochida Pharmaceutical Group declared support for the Task Force on Climate-related Financial Disclosures (TCFD) Recommendations in June 2023, and evaluates and manages climate-related risks and opportunities to make disclosures* in accordance with the TCFD recommendations. Going forward, we will seek to further enhance information disclosure.
*The TCFD's disclosure recommendations span four different areas: Governance, Strategy, Risk Management, and Metrics and Targets.
Governance
Mochida Pharmaceutical Group has established the Environmental Measures Committee (convened twice a year; chaired by the officer in charge of planning and administration) as an organization which examines important matters related to the environment. The Committee is responsible mainly for establishing medium-to-long-term environmental action plans, considering measures to address environmental issues, and implementing initiatives to protect the environment. The Environmental Measures Committee also confirms the results of activities to protect the environment such as annual reductions in CO2 emissions. We have also established the Risk Management Committee (convened twice a year; chaired by the officer in charge of planning and administration), which develops systems for managing major risks related to the Group's business management in general, including climate change risk.
Initiatives to address climate change are considered, in collaboration with the Environmental Measures Committee and the Risk Management Committee at meetings of the Sustainability Committee (advisory body to the Representative Directors; chaired by the officer in charge of planning and administration), which was established to promote sustainability activities across the Group.
The Sustainability Committee meets once every six months (and whenever necessary). The activities of these committees are reported to and discussed with a view to improvement at the Board of Directors at least once a year.
Strategy
Using the 1.5℃ scenario and the 4℃ scenario to assess the impacts of climate change on our business activities, we identified climate change-related risks and opportunities.
For the 1.5℃ decarbonization scenario, we referred to the Intergovernmental Panel on Climate Change (IPCC)'s SSP1-1.9 (scenario depicting a world that limits warming to 1.5°C in line with a sustainable development pathway), while for the 4℃ warming scenario, we referred to SSP5-8.5 (a high emissions scenario depicting a world that pursues development driven by fossil fuels, without climate policies).
We analyzed the identified risks and opportunities, taking the degree of their financial impact and frequency of occurrence into consideration, and conducted an evaluation of countermeasures.
Risk
| Scenario | Category | Events | Details | Timeframe*1 | Measures | Degree of Impact*2 |
|---|---|---|---|---|---|---|
| 1.5℃ | Transition risks | Tightening of decarbonization-related policies, laws and regulations | Increased burden of carbon taxes | Medium term to long term |
| Minor |
| Increased investment costs associated with the installation of equipment in response to decarbonization-related policies | Medium term to long term |
| Minor | |||
| 4℃ | Physical risks (Acute) | Increase in severity and frequency of weather-related disasters | Suspension of operation due to typhoons, heavy rain and other disasters | Short term to long term |
| Moderate |
| Physical risks (chronic) | Temperature rise | Increased energy costs associated with air-conditioning | Medium term to long term |
| Minor | |
| Water shortages | Depletion of water resources | Medium term to long term |
| Minor |
Opportunities
| Scenario | Category | Events | Details | Timeframe*1 |
|---|---|---|---|---|
| 1.5℃ | Reputation | Enhancing corporate value | Achievement of higher levels of customer trust and improved ratings from ESG investors through our climate change initiatives | Short term to long term |
| 4℃ | Market | Changing disease trends | Growing demand for pharmaceuticals to treat specific diseases such as infectious diseases associated with rising temperatures | Short term to long term |
*1 "Short-term": 0~1 year, "Medium-term": 1~5 years, "Long-term": 5~ 30 years
*2 "Minor": 10 billion yen or less, "Moderate": Between 10 billion yen and 20 billion yen, "Major": 20 billion yen or more
Risk Management
We have established Risk Management Rules applicable to Mochida Pharmaceutical Group, and have also developed a framework for managing risks related to Mochida Pharmaceutical Group's business management in general and manage climate change as one of our key risks. The business units and companies responsible for each major risk formulates measures to prevent the risk from materializing and measures to respond to the risk if it materializes, and the Risk Management Committee, which is responsible for Risk Management, deliberates and supervises the measures. These activities are reported to the Board of Directors and discussed with a view to improvement at least once a year.
Metrics and Targets
Mochida Pharmaceutical Group has set a target of reducing carbon emissions by 46% from FY2013 levels by FY2030 (covers research laboratories, plants, offices, commercial fleet), and reaching carbon neutrality by 2050.
(t-CO2)
| Items | FY2013 | FY2023 (vs FY2013) |
|---|---|---|
| CO2emissions | 17,900 | 15,142 (down 15.4%) |
| - Research laboratories and plants | 13,825 | 12,868 |
| - Offices | 1,155 | 460 |
| - Commercial fleet | 2,920 | 1,814 |
CO2 emissions by scope (Scope 1,2,3)
Starting in FY2022, we are proceeding with Scope 3 calculations to determine CO2 emissions in our supply chain.