We are working on disclosing information related to our response to climate change.
Task Force on Climate-related Financial Disclosures
We, Pioneer Group endorse the TCFD* recommendations, and as stated in our Group Environmental Policy,
we are striving to enhance its disclosure of information related to our response to climate change,
based on the framework recommended in the TCFD.
TCFD : Task force on Climate-related Financial Disclosures
Governance
We think that addressing climate change is one of our most important ESG issues and are working to achieve carbon neutrality by 2050. To achieve this goal, we have established the following governance structure to promote our initiatives.
Corporate Governance Structure
of the Board of Directors
Pioneer Group's responses to sustainability related issues including climate change are monitored and supervised through the CSR Committee, which is an advisory body to the Pioneer Board of Directors (7 members, including 2 outside directors).
Governance process for ESG issues
We identify important activity themes (materiality) which we tackle on a priority basis to contribute to the development of sustainable society. The CSR Committee, established as an advisory body of the Board of Directors, determines the materialities including environmental issues such as climate change, provides instructions for addressing ESG issues including the materialities, monitors progress and performance result in addressing climate change related issues, and periodically reports related activities to the Board of Directors every year.
The committee carefully deliberates on the identification of ESG issues and the determination of materiality from the perspective of ensuring consistency with the management policies and plans approved by the Board of Directors.
Its committee is held at least twice a year on a regular basis, as well as whenever the Board of Directors makes an inquiry or the President and CEO, who chairs the Committee, deems it necessary.
Organization structure
of the CSR Committee
The Pioneer Group's CSR Committee is chaired by the President and CEO. To ensure that the Board of Directors appropriately monitors and supervises our activities to tackle ESG issues, independent directors and members with a wide range of insight and expertise in climate change issues are selected as committee members or observers, and discussion and reporting from a variety of perspectives are implemented in the committee.
Organizational structure of Business Operation Execution
for Climate Change-related Issues
We have established an organizational structure of business operation execution for climate change issues, with the President and CEO as the top supervisor. He has delegated tasks related to climate change to the executive officer in charge of the environment activities. The environmental executive officer oversees the Environmental Promotion Committee and the Environmental Management Division, thereby ensuring the effectiveness of the business operation execution structure related to climate change.
Execution of Operation
by Environmental Executive Officer
The executive officer in charge of environment chairs the Environmental Promotion Committee under the President and CEO, and oversees the execution of environment-related operations including climate change across the Pioneer Group. In addition, when the Environmental Promotion Committee deliberates and decides on the identification of climate change issues and responses to them, it ensures consistency with management policies and plans, and reviews them whenever major changes are necessary, thereby establishing a PDCA cycle for climate change-related issues. With regard to climate change issues and our responses for them that are deemed to have a significant impact on our business management, the environment executive officer submits reports to the CSR Committee, an advisory body to the Board of Directors, and reports to the Board of Directors for its decision as necessary. Furthermore, the environmental executive officer instructs the relevant Pioneer Group business units, administrative divisions, subsidiaries, etc. to take concrete actions based on the instructions and decisions of the President and Chief Executive Officer.
Under the direction of the environmental executive officer, the Environmental Management Division reports information on opportunities and risks in business operations based on climate change issues to the CSR Committee.
The CSR committee identifies business models that contribute to environmental conservation with a CSV* perspective referring to the information from the Environmental Management Division.
Among the identified items, activity themes that should be strongly focused on as materiality is derived in the CSR committee and the Board of Directors makes decisions on these themes. The Board of Directors assesses the feasibility and growth potential of CSV on a medium-term and incorporates them into the Pioneer Group's overall management plan.
CSV: Creating Shared Value
Basic Approach to CSR and Value Creation Process
Environmental Materiality
Details of our materialities are listed on the “Material Issues and Achievement” page.
Material Issues and Achievement
Discussions
on Climate Change Issues
The following is a list of the roles and responsibilities of the Pioneer Group's committees and their discussions on climate change issues over the past year.
| Council | Role, Function | Chairperson | Members |
|---|---|---|---|
| Board of Directors |
|
The president and CEO (Chairman) | President, Directors including two independent directors |
| CSR Committee |
|
The president and CEO (Chairman) | Chairperson (The president and CEO), Vice chairperson (Executive officer in charge of CSR division), committee members and observers (who are selected by the chairperson of the committee from directors, executive officers, responsible persons, etc. of Pioneer Corporation and its group companies) |
| Council | Date | Deliberation Items |
|---|---|---|
| Board of Directors | May-24 |
|
| CSR Committee | Feb-24 |
|
| Mar-24 |
|
|
| Aug-24 |
|
|
| Oct-24 |
|
Strategy
The Pioneer Group identifies risks and opportunities in climate change through scenario analysis of both the 1.5°C scenario and the 4°C scenario, and assesses the significant impacts on the Group. Each scenario is determined with reference to information from the International Energy Agency (IEA), the Intergovernmental Panel on Climate Change (IPCC), and other sources.
The following is a summary of the risks and opportunities based on those scenarios (perspective) assumed by the Pioneer Group.
| 1.5°C scenario | Opportunity |
|
|---|---|---|
| Opportunity |
|
|
| Risk |
|
|
| Risk |
|
|
| 4°C scenario | Opportunity |
|
| Opportunity and risk |
|
|
| Risk |
|
Analysis of Opportunities and Risks on Climate Change
| Classification | Items | Scenario in 2030 | Scenario in 2050 | Mid-term Initiatives | Corporate Vision | |
|---|---|---|---|---|---|---|
| Transition Risks | Policy and Legal | Decreased profits and increased production costs due to higher prices for carbon taxes and emissions trading system (ETS) |
|
|
|
Various measures such as renewable energy, energy conservation, and energy storage will be considered, and our business operation will be carried out in accordance with a stable long-term plan. If CO2 emissions are not reduced even specific reduction activities are implemented, carbon credits or certificates will be used to cover the shortfall. |
| Reputation | Poor reputation due to lack of responses to stakeholder requests |
|
|
|
Achieve emission reductions targets ahead of plan through reliable reduction countermeasures. | |
|
|
|
Disclose information in accordance with market requirements, such as domestic listing requirements or international standards, and establish a business structure to attract investment and collaboration. | |||
| Physical Risks | Acute Risk | Suspension of business due to severe natural disasters |
|
|
|
In the event of damage, we are able to minimize the impact within own facilities as well as ensure the safety of our employees, and if the surrounding geographical environment is not affected, our business operations is able to be resumed quickly. |
| Opportunities | Products / Services | Expansion of low-carbon products and services |
|
|
|
The business ratio in the planning and production of low-carbon products and services, such as improved fuel efficiency and electricity consumption rates, is increasing. |
| Market | Environmental changes in the mobility field (changes in consumer/business operator behavior and difficulties in responding to extreme weather) |
|
|
|
Become a leading company for accident reduction solution services in the mobility domain. | |
Identification of Critical Flood Risks based
on the 4°C Scenario (Perspective)
We identified flood risk as a critical risk and conducted specific risk assessments at domestic and overseas production sites where there was concern of significant impact on our businesses.
The risk assessment method referred to hazard maps and flood risk analysis and diagnosis tools. As a result of the risk assessment, we determined that the sites with the highest risk of flooding due to extreme weather conditions were the Kawagoe Plant in Japan and the production plant in Thailand.
In particular, the area where the Thai plant is located has suffered significant flood damage in the past, and we are working to reduce the risk of flood damage by drawing on this experience.
The Thai government is taking measures such as increasing anti-flood ponds, strengthening and expanding major dams, building barriers in urban areas and agricultural land, and installing sluice gates on major rivers and canals.
We are also working to reduce flood damage with referring to the countermeasures of the industrial park where our factory is located such as reinforcement of embankment or monitoring of water level in the river.
Risk Management
Basic Process of Risk Management
The Pioneer Group has established the organizational structure to properly identify and manage risks in our business operations. To identify key risks including climate change issues, we conduct risk assessments and prioritizes risk responses based on assessment results. Furthermore, the implementation status of risk management within the Group is monitored regularly, at least twice a year.
Identifying and prioritizing risks
in business and operations
Pioneer's divisions and affiliates identify risks in their businesses and operations each based on a prescribed implementation process. We decide the importance of risks based on indicators such as the impact on corporate value, human life, profits, probability of occurrence in the future, and scope of impact. In addition, risks, including risks in climate-related issues, that are expected to cause total damage of 100 million yen or more are to be extracted without exception. Then, critical risks are determined from among the extracted risks. After that, specific risk scenarios regarding critical risks will be identified and countermeasures for the risks will be materialized thereby they are linked to the activities of the responsible organization for risk countermeasures.
In a case of an estimated damage amount of 100 million yen or more, reporting to the President and CEO is required as a serious matter, in consideration of the reduction in corporate value due to inadequate response to climate-related issues and the increased costs caused by the carbon tax increase and other factors.
As key risks to our business strategy and finances based on climate change issues, we identify business shutdowns and increase in losses due to significant change in the external environment such as intensifying natural disasters, and profit pressure due to increased costs such as higher carbon taxes. We also recognize that inappropriate of GHG emission reductions activities and inadequate disclosure of information on climate-related issues could worsen the reputation from stakeholders, leading to lost sales opportunities and reduced sales.
Countermeasure Management
and Progress Monitoring
of ESG-related risks
Regarding ESG-related risks, the related business units and Group companies report quarterly on countermeasures to risks identified as important item and the progress of KPIs in our materiality at the CSR Committee, chaired by the President & CEO. The CSR Committee manages and evaluates the implementation status of these items, and reviews extracted items and activity level in our materiality accordingly. Whenever a theme that should be added or revised regarding extracted items, the review is promptly implemented under PDCA cycle. Furthermore, in order to ensure thorough oversight by the Board of Directors, important deliberated items within the ones discussed by the CSR Committee are reported to the Board of Directors to receive instructions and approval of corrective measures.
Environmental Materiality
Details of our materialities are listed on the “Material Issues and Achievements” page.
Material Issues and Achievements
Environmental Opportunities and Risks
Detailed opportunities and risks are described in “Strategy” above.
Metrics & Targets
We have established the following metrics and targets and are working the reduction of GHG emissions to manage climate-related risks and opportunities.
GHG emissions reduction
Long-Term Target
| Category | Target Year | Target Activity |
|---|---|---|
| Scope 1-3 | Fiscal year ending March 2051 | Achievement of carbon neutrality |
Near-Term Target
| Category | Target Year | Target Activity | GHG emissions | Reduction rate of fiscal year ended March 2024 | ||
|---|---|---|---|---|---|---|
| Base year Fiscal year ended March 2021 (tCO2) |
Target year Fiscal year ending March 2031 (tCO2) |
Actual result in fiscal year ended March 2024 (tCO2) |
||||
| Scope 1, 2 | Fiscal year ending March 2031 | Absolute GHG emissions 42% reduction from fiscal year ended March 2021 | 33,842 | 26,912 | 19,628 | ▲20.5% |
| Scope 3 Category 1, 11 | Fiscal year ending March 2031 | 42% reduction from fiscal year ended March 2021 | 1,943,566 | 1,127,268 | 1,457,676 | ▲32.1% |
The above near-term targets have been certified by SBTi (Science Based Targets initiative).
Relations with Suppliers
| Target | Target Year | Actions | Base year Fiscal year ended March 2025 (%) |
Actual result in fiscal year ended March 2025 (%) |
Target in fiscal year ending March 2029 (%) |
|---|---|---|---|---|---|
| Supplier engagement in Category 1 of Scope 3* | Fiscal year ending March 2030 | Engaging 10% of our suppliers by emissions covering Category 1 of Scope 3 to have GHG emissions reduction target with science-based target level. | - | - | 10% |
Supplier engagement: No past performance result is listed due to setting the target in the fiscal year ended March 2025.
Details information is posted on "Pioneer Group Environmental Data" page.
- Pioneer Group Environmental
Policies - Environmental Management
- Environmental Contribution
- Prevention of Global Warming
- Resources Saving and Recycling
- Management of Chemical
Substances - Biodiversity and Social
Contributions - Pioneer Group
Environmental Data - Task Force on Climate-related Financial Disclosures
- Cooperation with Environmental International Initiatives
- Comparison Table of
Environmental Inforamtion
