Environmental Management Risks and Opportunities
Information Disclosed According to the Task Force on Climate-related Financial Disclosures (TCFD*1)
OKI announced its support for the TCFD in May 2019 from a perspective of a positive economic and environmental cycle. Along with systemically managing climate-related risks, opportunities, and countermeasures for them, OKI aims to enhance information disclosure about these efforts.
Governance |
- Roles of managers and director monitoring system for climate-related risks
- The OKI Group has established a Chief Environmental Officer has been appointed from among the executive officers to strengthen environmental governance, including climate change measures , from fiscal year 2023. The Chief Environmental Officer is responsible for drafting Groupwide policies and medium-term plans in the environmental field and is accountable for achieving the overall Group plan.
- The Management Committee makes decisions on important matters related to sustainability. The above-mentioned promotion body reports to the Management Committee on the status of environmental, social, and governance initiatives and issues that embody the Material Issues.
- Matters that may significantly impact business are reported to the Board of Directors.In fiscal year 2022, deliberations included the revision of the OKI Environmental Vision 2030/2050 and the establishment of the OKI Group Human Rights Policy.
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Strategy |
- Scenario analysis for identifying and addressing risks and opportunities
- OKI identifies physical and transition risks based on reports related to climate change issued by international institutions and performs scenario analysis that considers the intensification of climate change if temperatures rise 4℃ and social changes needed to limit this increase to1.5℃.
- As shown on the following page, perspectives of climate change, resource circulation, and prevention of pollution are included in scenario analysis. OKI identifies risks and opportunities based on these scenarios and establishes countermeasures to better respond flexibly to phenomena that could occur in the future. (Regarding the 1.5℃ target, please see "Environmental Action Plan.")
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Risk Management |
- Risk selection/evaluation process
- At least once a year, OKI identifies climate change or other recent phenomena to evaluate the impact, frequency, and period of the risks and opportunities that emerge from them in order to determine their importance.
- Risk management process
- OKI considers countermeasures for the above risks and opportunities, developed a Group-wide plan for environmental management, and is implementing this into environmental action plans at each organization and site. The execution status of these plans is checked through internal auditing and revised as needed.
- Method of integrating comprehensive risk management
- Comprehensive risk is managed centrally by the environmental management system of the entire OKI Group under the responsibility of the President. Each business division and the corporate division work together to plan, execute, monitor, and revise this system. OKI has deployed countermeasures in the Group to prevent "common risks" as established by the Risk Management Committee, which manages risks across the entire Group.
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Indicators/Targets |
- Indicators and Targets used
- Scope 1, 2, 3
- Results
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- *1 : TCFD (Task Force on Climate-related Financial Disclosures): Proposal that suggest the need for companies to disclose information to investors on their response toward climate change
Strategy Based on Scenario Analysis
As societal changes to limit the increase in temperatures below 1.5°C progress, there will be changes in laws for decar-bonization, technological progress, and market needs. We expect that there will be rising demand for OKI’s decarbon-ization solutions. If temperatures rise 3 to 4°C, there will be increased physical risks from intense disasters due to the impact of climate change. It is possible that severe impact will hit the supply chain, including OKI’s own sites. Needs are also expected to rise for disaster information systems that serve to prevent severe damage.
Scenario Analysis |
Initiatives |
Category |
Expected Phenomena |
Risk/ Opportunity |
Impact on Future Finances |
Time frame*3 |
Monetary Impact*4 |
1.5˚C climatechange scenario*1(transitional risks) |
Growing and widespread demand for decarbonization |
Risk |
- Decreased orders due to failure to meet energy efficiency standards or customer requirements
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Medium term |
Medium |
- Product: Energy-saving for hardware
- Supply Chain: Strengthening communication with suppliers
- Sites: Reducing CO2 emissions through thorough energy-saving measures and the introduction of renewable energy
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- Higher costs stemming from strengthening decarbonization at business sites
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Medium
term |
Small |
opportunity |
- Expansion of demand for decarbonization and labor-savin solutions
- Growing need for technologies supporting the spread of renewable energy
- Increasing demand for renewable energy-driven products
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Medium
term |
Medium |
- Product: Expansion and creation of environmentally contributing products contributing to decarbonization
Examples: Development of decarbonization and labor-saving solutions utilizing IoT and AI, expansion of renewable energy-driven hardware products, and strengthening research and development (e.g., AI optimization)
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4˚C climatechange scenario*2(physical risks) |
Increase and intensification of extreme weather events |
Risk |
- Sites & Suppliers: Damage to plants or suppliers due to disasters
- Sites: Increased air conditioning costs due to rising temperatures
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Short term |
Large |
- Site: Strengthening climate change BCP/BCM
- Suppliers: Strengthening procurement BCP
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opportunity |
- Products: Growing demand for advanced disaster prevention and mitigation solutions
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Medium
term |
Small |
- Product: Strengthen business deployment through disaster information systems
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Prevention of pollution through chemicals |
Expansion and complexity of regulated substances |
Risk |
- Product: Standards violations for chemicals contained in products
- Site: Pollution due to deterioration of facilities
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short term |
— |
- Product: Strengthen sharing of operations across the entire Group
- Site: Review facility inspection/exchange standards
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opportunity |
- Product: Expansion of demand for efficiency improvement in chemical substance management (manufacturing field)
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- Product: Deployment of survey systems and analysis services for chemicals in products
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Resource circulation |
Strengthening of laws and regulations for oceanic plastics and microplastics |
Risk |
- Site: Inflation of waste product disposal costs; refusal to accept from waste disposal companies
- Product: Risks of resource deprivation; risks of materials supply shortage
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Medium
term |
— |
- Site: Waste reduction
- Reuse of plastic packaging
- Reduction of percentage of disposed items through improved efficiency in extracting metal materials
- Product: Recovery and reuse of parts from used products utilizing the wide area certification system for industrial waste
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opportunity |
- Product: Expansion of demand for resource-saving products and recycling services
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- Product: Provide solutions to extend the service life of customer facilities, reduce burden on customers by recovering used products utilizing the wide area certification system for industrial waste
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- *1 : See IEA NZE 2050.
- *2 : See IPCC RCP8.5.
- *3 : Time frame definitions: Long term means more than 10 years, medium term means 3 to under 10 years, and short term means 1 to under 3 years
- *4 : Monetary impact definitions (in yen): Large means ¥10 billion or more, medium means ¥1 billion to less than ¥10 billion, and small means less than ¥1 billion