Responses to TCFD Recommendations

Governance

See here for details.

Strategy

We investigated climate change trends and performed an evaluation of the key risks and opportunities for the Sankyu Group
until 2030 from both quantitative and qualitative aspects.
We also considered evaluation of financial impact and action to take using scenarios assuming temperatures rise by
1.5°C (environmental conservation scenario) and 4.0°C (inaction scenario).
By considering action to take based on multiple scenarios, we consider how
we can flexibly respond to environmental changes and social conditions.

Scenario analysis, evaluation of risks and opportunities

Risk Management

We appropriately understand risks and opportunities that climate change brings about on our business, and manage transition
risks and physical risks separately, in addition to identifying important risks and opportunities with consideration for their financial impact.
In order to identify important risks and opportunities, and promote various initiatives, we have established a Sustainability Committee
chaired by the President. The content discussed in the Sustainability Committee is reported to the Board of Directors.

Indicators and Targets

The Sankyu Group has set medium- to long-term targets and will promote initiatives aimed at reducing greenhouse gases that cause
climate change (particularly CO2, which has a large impact).

CO2 emission reduction targets

The scope of consideration includes Sankyu itself and its domestic consolidated subsidiaries,
and the Sankyu Group is conducting activities with the CO2 emission reduction target of net zero by 2050.
(Covering Scope 1 and 2)

Measures to reduce CO2 emissions

• Introduction of and switch to environmentally friendly vehicles
• Reduction of fuel use (Eco Drive, stopping idling,
  　 improvement of transportation efficiency, etc.)
• Consideration and promotion of switching to biofuels
• Installation of solar panels (in-house installation, PPA)
• Promotion of various energy-saving activities
• Purchasing of power from renewable energy sources
• Various environmental protection initiatives

※Scope approaches

• Scope1：CO2 emitted through the use of fuel by the company’s own vehicles and facilities
• Scope2：CO2 emitted through the use of electricity in the company’s own facilities
• Scope3：CO2 emitted in the supply chain other than Scope 1 and 2