Information Disclosure Based on TCFD Recommendations

Our company has established a "Sustainability Committee," chaired by the President and CEO, to deliberate and decide on issues related to climate change. This committee deliberates and decides on policies and measures, and then reports or submits them to the Board of Directors.
Furthermore, this committee will monitor the progress and results of our materiality, including our decarbonization targets, and report to the Board of Directors at least twice a year, including any need for improvement, and will formulate necessary measures.
The Board of Directors will oversee climate change-related initiatives based on the recommendations/reports submitted by this Committee and will issue instructions as necessary.
The Sustainability Committee is comprised of internal directors, executive officers, and heads of various management departments, with the ESG Promotion Office serving as its secretariat. It also receives advice from external experts as needed. In practice, a Sustainability Subcommittee and a Sustainability Liaison Committee are established under the committee, and these two groups collaborate with each other.

Within our group, we have established "Risk Management Regulations" for various risks, including disaster risks, information risks, employment and personnel risks, as well as environmental risks. We regularly hold a "Compliance and Risk Management Committee" (hereinafter referred to as the Committee) to manage, improve, and strengthen these risks. The Committee is chaired by the President and composed of department heads from our head office.
In addition, we have established a permanent Risk Management Department with 10 members specializing in safety, customs clearance, and quality, three of whom also serve as the secretariat for the committee's operations.
Risk management in sustainability, including climate change, is the responsibility of the Sustainability Committee. As part of this, the Committee monitors the progress of climate change and regulatory trends, and identifies and assesses the financial impacts of climate change-related risks and opportunities under 1.5°C and 4°C scenarios over a medium to long term. The identified risks and opportunities are regularly reassessed by the Committee and reported to or submitted to the Board of Directors at least once a year, where risks are prioritized and decisions are made on how to manage them (mitigate, transfer, accept, or control). By conducting such scenario analyses once a year, climate change-related risks are reviewed regularly.
Furthermore, climate-related risks reported to or submitted to the Board of Directors are reported to the Compliance and Risk Management Committee, and preparations are underway to treat them in the same way as company-wide risks.

Our company conducts scenario analyses to assess the medium- to long-term risks and opportunities to our business related to climate change, and to consider countermeasures. This year's analysis focused on our domestic operations alone, identifying risks and opportunities expected to impact us in fiscal years 2030 and 2050, and examining their financial impacts and countermeasures. As assumed scenarios, we considered a 4°C scenario in which existing policies remain unchanged, and a 1.5°C scenario in which decarbonization policies are actively pursued to limit the rise in global average temperature by the end of the 21st century to 1.5°C above pre-industrial levels.

As part of the scenario analysis, we first listed the climate-related transition risks, physical risks, and opportunities anticipated throughout our entire value chain, and then extracted the items that we considered to have a particularly significant impact on our company. Next, for each of the extracted risks and opportunities, we examined the external environment and our company's situation assumed in the 1.5°C and 4°C scenarios for each target year, referring to the external scenarios, and organized the calculation logic that forms the basis for the financial impact calculation, as well as the internal and external data necessary for the calculation. After actually calculating the financial impact using the collected data, we evaluated the relevant risks and opportunities in three stages from the perspectives of "likelihood of occurrence" and "impact," and conducted an assessment of their importance to our company*. Finally, based on the results of the financial impact calculation and importance assessment, we considered the policy for countermeasures for each item.

As the global movement towards a decarbonized society accelerates, the Japanese government has also set CO₂ reduction targets to achieve carbon neutrality. In line with the government's targets, our company has set a medium-term target of "reducing CO₂ emissions (domestic Scope 1 + Scope 2) by 46% compared to 2013 levels by fiscal year 2030." We will also continue to consider setting a long-term (fiscal year 2050) target, taking into account the importance of achieving carbon neutrality as a global imperative and considering its effectiveness.
Furthermore, since we began calculating Scope 3 reduction targets in fiscal year 2024, we will continue to consider them in the future.

Our actual CO₂ emissions figures are as follows: