Basic approach and policy

Climate change and the degradation of natural capital pose various risks, such as reduced yield and quality of natural raw materials and the tightening of related regulations. On the other hand, we also recognize numerous business opportunities, including increased demand for flavors used in alternative foods driven by rising environmental and health awareness, growing demand for environmentally friendly products such as plastic-reduction solutions, and enhanced reputation stemming from strengthened sustainability initiatives.

In response to these anticipated environmental changes, the Group aims to help solve global challenges that are not limited to flavors and fragrances, by leveraging a wide range of technologies to create new value and inspiration, contributing to a richer and more fulfilling life. In line with the Paris Agreement and the targets set by the Japanese government, we have committed to reducing GHG emissions by 46% by FY2030 compared to FY2013.

We also comply with climate-related regulations, such as the Act on Rationalizing Energy Use and Shifting to Non-Fossil Energy (Energy Conservation Act) and the Act on Promotion of Global Warming Countermeasures, and submit the required reports accordingly. To align with the Paris Agreement, we submitted a commitment letter to the Science Based Targets initiative (SBTi) Secretariat on May 17, 2024, with the aim of submitting a completed SBTi Target Validation Application during FY2025. Through our entire value chain, we are advancing efforts to achieve carbon neutrality and nature positivity.

The Group expressed its support for the recommendations of the TCFD in March 2022. We are also working to disclose information in line with the recommendations of both the TCFD and the TNFD.
For more details, the T. Hasegawa Group TCFD/TNFD Disclosures (PDF) .

Governance and risk management

Governance

Climate- and nature-related risks and opportunities are managed within the Group’s sustainability promotion system. The CEO is responsible for sustainability matters, including climate change and biodiversity.
For more details, “Sustainability Promotion System”.

Risk management system

The Group has established the Risk Management Committee, chaired by the CEO, as a cross-functional body to analyze, manage, and consider responses to various risks. Climate- and nature-related risks and opportunities that may affect the Group’s business are identified and assessed using the LEAP approach recommended by the TNFD. The results of these analyses are reported to the Risk Management Committee and the Board of Directors, alongside other risk categories.
For more details, “Risk Management”.

Strategies

Scenario and LEAP analysis

The Group has integrated its nature-related risk analysis, based on the TNFD framework, into the climate-related risk analysis previously conducted under the TCFD, and discloses this information in a unified manner. Climate-related factors are encompassed within the scope of the TNFD disclosure recommendations, so we conducted our analysis using the LEAP approach suggested by the TNFD, while taking various scenarios into account.
For more details, “Biodiversity”.

Reduction of energy consumption

The Group takes the reduction of energy consumption as an important issue and is proactively working on it.
In addition to conducting company-wide energy conservation activities, we promote energy conservation by updating all boilers used in the Production Division to models with less GHG emissions and better combustion and fuel efficiency and by installing special high-voltage power receiving and transforming equipment and energy monitoring systems. The Fukaya Facility and the Itakura Facility, which are Type 1 Designated Energy Management Factories as defined by the Act on Rationalizing Energy Use and Shifting to Non-fossil Energy (Energy Conservation Act), have established energy usage optimization standards and are working on energy conservation based on those standards.

In FY2024, we improved manufacturing processes, streamlined the formula, reviewed the use of steam to reduce loss, increased the efficiency of boiler operations, optimized air conditioning and lighting operating hours, and so on. As a result, we improved our unit energy consumption by 3.6%, achieving our target of 1.3% reduction from the previous year.

Reduction of GHG emissions

Third-party verification of GHG emissions (Scopes 1 to 3) was conducted on a non-consolidated basis in FY2021 and has been conducted on a domestic consolidated basis since FY2022. In FY2024, we reduced our Scope 1 and 2 GHG emissions by 11.6% compared to the previous year, achieving a 36.0% reduction relative to the FY2013 baseline towards our FY2030 target of a 46% reduction.

We will continue conducting third-party verification of GHG emissions to ensure the accuracy of our calculation methods and the reliability of our data.

As part of our reduction plan, we aim to achieve a 100% green power procurement rate by FY2029. Since December 2021, our headquarters building has maintained 100% green power usage. At the R&D Center, Fukaya Facility, and Itakura Facility, we have gradually increased the procurement ratio, reaching 18.3% in FY2024. Moving forward, we plan to expand this initiative across the entire Group.

We have submitted a letter of commitment to SBTi with the aim of having SBTi Target Validation verified by the organization and will continue our efforts to reduce GHG emissions over the medium to long term, including Scope 3 and overseas groups.

Response to climate change through various initiatives

The T. Hasegawa Group supports the goals of the Paris Agreement and those set by the Japanese government and endorses organizations that promote action on climate change. We participate in and express our support for various climate-related initiatives and industry groups, including the TCFD.

The Japan Flavor and Fragrance Materials Association, to which we belong, is a member of the International Fragrance Association (IFRA), and we are also a member of the International Organization of the Flavor Industry (IOFI). Through direct involvement and participation in the activities of the Japan Flavor and Fragrance Materials Association, we contribute to sustainability-related initiatives, including efforts to ensure the safety of flavors and fragrances.

IFRA and IOFI share the common belief that embedding sustainability into corporate business strategies is essential for long-term prosperity and a sustainable future. This belief is formalized in their Sustainability Charter.

We have long placed the highest importance on sustainability and have undertaken a variety of initiatives. To demonstrate our commitment at a higher level, we signed the above Sustainability Charter on March 31, 2020. We are working to reduce our environmental footprint, including GHG emissions, and to address climate change in pursuit of a sustainable society.

As a member of these industry associations, we regularly review their climate-related policies. If any such policy were to significantly diverge from the goals of carbon neutrality, such as those outlined in the Paris Agreement, or from the Group’s own climate policy, we would engage in dialogue with the association and request that the policy be revised.

Indicators and targets

The T. Hasegawa Group has set targets related to GHG emissions and is actively addressing issues such as climate change and biodiversity.
For more details, please refer to the T. Hasegawa Group ESG Data Book (PDF).