Environment

Basic Concept

In October 2020, the Japanese government declared its intention to achieve a decarbonized society by 2050.

Energy-derived CO₂ accounts for the majority of Tosoh's greenhouse gas (GHG) emissions. Tosoh has been actively investing in energy conservation ahead of schedule and working vigorously to reduce these emissions. Tosoh will promptly implement various measures toward a decarbonized society, taking into account trends in Japan's energy policy, the policies of industry associations, technological innovation, and the distribution of CO₂-free fuels.

CO₂ Reduction Promotion System

Tosoh's climate change initiatives are being promoted mainly by its CO₂ Reduction and Effective Use Promotion Committee and its Central Energy Management Committee.

We are also collecting information on social trends, regulatory requirements, and risk management related to climate change, and sharing this information with Tosoh Group companies. Matters related to these activities are reported to the respective board of directors for approval as appropriate, and instructions are received as necessary.

CO₂ Reduction and Effective Use Promotion Committee

The committee is chaired by the overseeing Tosoh director, who is responsible for identifying issues, formulating policies, conducting investigations and analyses, and managing progress with regard to the reduction of energy-derived GHG emissions. This includes shifting to alternative fuels and effective utilization of CO₂ through recovery and conversion to raw materials. These efforts actively promote the reduction and effective utilization of energy-derived CO₂ emitted from the operation of in-house thermal power generation facilities.

In June 2021, the CO₂ Reduction and Effective Use Strategy team and the CO₂ Reduction and Effective Use Task Forces at the Nanyo and Yokkaichi Complexes were established to strengthen the system for promoting CO₂ reduction and effective use.

Central Energy Management Committee

The committee, chaired by the general manager of production and technology planning, works to reduce overall energy consumption. This includes improvements in energy consumption in production and transportation, and the promotion of alternative energy sources. Specifically, the committee discusses and determines energy management policies, midterm and annual plans, compliance status and evaluation methods, and matters related to energy management.

CSR Advancement Liaison Meeting

The Tosoh CSR Advancement team serves as the secretariat of the CO₂ Reduction and Effective Use Promotion Committee and the Central Energy Management Committee. Through the CSR Advancement Liaison Meeting, it shares information on climate-related social trends and exchanges opinions with the aforementioned committees on the compilation of Group-wide GHG emissions.

Reduction Targets

Tosoh is participating in the Low Carbon Society Action Plan of the Japan Chemical Industry Association (JCIA). In March 2019, the JCIA reviewed the CO₂ emission reduction targets for the Japanese chemical industry. Taking advantage of this opportunity, Tosoh has set a target of reducing energy-derived CO₂ emissions by 6% from business as usual (BAU: production x base year 2014 CO₂ basic unit) emissions by fiscal year 2026.

In addition, Tosoh utilizes an internal carbon pricing system to promote capital investment that contributes to energy conservation.

Fiscal Year 2021 Results

Greenhouse Gas Emissions

Tosoh’s GHG emissions in fiscal year 2021 totaled 7,484 kilotons-CO₂e, a decrease of 153 kilotons-CO₂e compared with fiscal year 2020.

We are ahead of schedule in reducing our energy-derived CO₂ emissions, as we are furthering our capital investment in fuel conversion and energy conservation as planned.

The Tosoh Group’s GHG emissions decreased by 2.0% compared with fiscal 2020.

Greenhouse Gas Emissions by Scope

To ascertain greenhouse gas emissions across the entire Tosoh Group supply chain, we calculate the scope of the emissions.

(kilotons-CO2)		FY18	FY19	FY20	FY21
Scope 1		7,705	7,833	7,770	7,628
Scope 2		438	403	424	402
Scope 3		6,020	5,923	6,944	6,638

Calculated Values for Scope 3 Emissions (kilotons-CO₂e)

Categories		FY19	FY20	FY21
Purchased goods and services		2,321	2,787	2,623
Capital goods		134	193	139
Fuel and energy-related activities not included in Scopes 1 and 2		1,071	1,306	1,287
Transportation and delivery (upstream)		473	522	511
Waste generated by business activities		17	17	16
Business trips		7	16	2
Employee commuting		9	11	12
Leased assets (upstream)		-	-	-
Transport and delivery (downstream)		-	-	-
Processing of products sold		-	-	-
Use of products sold		19	17	26
End-of-life treatment of products sold		1,874	2,066	2,023
Leased assets (downstream)		-	-	-
Franchises		-	-	-
Investments		-	-	-

Scope 1: Direct emissions from fuel combustion and plant operation by Tosoh.
Scope 2: Indirect emissions from electricity and heat supplied by other companies.
Scope 3: Other indirect emissions including from excavation and transportation of raw materials and fuels, transport in general, use and disposal of products, and employee commuting and business trips.

Scope 3 emissions figures for fiscal years 2018 through 2020 have been revised as a result of a review of the accounting methods used. For calculation methods and emission factors, please refer to the Ministry of the Environment's Database for Calculating Greenhouse Gas Emissions, etc. by Organizations Throughout the Supply Chain. The results were produced by ver 2.6 through fiscal 2019, by ver 3.0 in fiscal 2020, and by ver 3.1 in fiscal 2021.

Energy Consumption Index

Tosoh's energy intensity index for fiscal 2021 was 98.2% compared with fiscal 2010. This marked an increase of 1.8 percentage points from fiscal 2020 due to a decline in energy efficiency attributable to factors including a decrease in production volume.

Logistics-related CO₂ Emissions and Basic Energy Unit

In fiscal 2021, Tosoh’s logistics CO₂ emissions dropped 6.2% compared to fiscal 2020, mainly due to a decrease in energy consumption caused by lower transportation volume. The logistics basic energy unit—energy consumption converted to crude oil (kiloliter) / transport tonne-kilometers (one million tonne-kilometers)—was 18.6, the same as in fiscal 2020.

To reduce CO₂ emissions, we are continuously promoting energy efficiency through a modal shift in transport that sees us promoting marine and rail transport and improving transportation fuel efficiency. Tosoh Logistics Corporation, a Group company, completed renovation of its ethylene carrier, the Shoyo, in December 2020. The ship has been designed to be environmentally friendly, with an optimized hull, the Eco-Stator—a rectifying plate that improves propeller efficiency—and friction resistance-reducing paints to improve propulsion performance. The vessel also features an electronic charting system with Track Control, an automatic course maintenance system to achieve optimal navigation and fuel consumption.

Investment in Energy-Saving Equipment

One of the basic policies of Tosoh's medium-term business plan is to promote energy conservation and the effective use of CO_2. The company invests tirelessly in energy conservation as a social responsibility. 

• Energy-saving modifications of caustic soda electrolyzers (Nanyo, Yokkaichi)
• Installation of gas turbine, improvement of efficiency of naphtha cracking furnace, and introduction of advanced control system for ethylene plant (Yokkaichi)
• Installation of state-of-the-art turbines and rotors in private power generation facilities and introduction of an optimal load balance system in power plants (Nanyo)

Active Use of Biofuels in Production Activities

The thermal power generation facilities at Tosoh's Nanyo Complex are switching to biofuels as an alternative to coal. In fiscal year 2021, the use of biofuels led to a reduction of approximately 36,000 tons of CO₂ emissions. Starting in fiscal 2021, we are sequentially investing in equipment to further increase usage volume.

In November 2019, Tosoh announced its support of the recommendations of the TCFD.¹ The TCFD was established by the Financial Stability Board to provide a framework for information disclosure useful for companies to understand climate-related corporate risks and opportunities. Going forward, the Tosoh Group will disclose information on the Group's initiatives in line with the recommendations. 

¹ In June 2017, the TCFD published recommendations related to items of information disclosure.

Governance

The Tosoh Group recognizes that contributing to the resolution of various social issues, including climate-related problems, through its business activities is important for the sustainable growth of the Group. As such, it promotes business activities that place CSR at the core of management.

The CSR Committee, chaired by the president of Tosoh Corporation, deliberates on important matters related to the CSR activities of the Tosoh Group. Resolutions of the CSR Committee are reported to the board of directors for approval and direction. In addition, the CO₂ Reduction and Effective Use Promotion Committee is responsible for formulating specific policies and strategies for reducing GHG emissions.

Strategy

The CO₂ Reduction and Effective Use Promotion Committee is responsible for planning strategies, identifying issues, formulating policies, conducting investigations and analyses, and managing progress in relation to the reduction of energy-derived indicators and target CO₂ emissions, as well as the effective use of CO₂ as a raw material for chemical products.

Tosoh has a high-efficiency cogeneration in-house thermal power generation facility to secure the stable supply of electricity at low cost, which is required in the manufacture of chemical products. In the future, when carbon taxes and emission trading systems are introduced, we will have to bear new costs. For example, if the carbon price of $100/t-CO₂ is applied and we purchase emission credits equivalent to 100,000 tons of CO₂, we will incur costs of about ¥1 billion.

To acquire opportunities, we have started to evaluate the environmental contribution of existing products, and will work to expand sales in response to the growing market for products and services that reduce environmental impact. We have set environment and energy as a priority area for R&D and are working to create products and services that meet market needs and social issues related to climate change.

Risk Management

Potential risks posed by climate-related issues are assessed by each division in charge through the CSR Committee, using information on social trends and the status of consultations and discussions with the Japanese government. Each division managing risks related to business operations identifies risks related to the division and assesses the possible financial impact, and reports to the president. Risk management in daily business activities is carried out independently under the supervision of the director in charge, who consults the board of directors for approval and instructions when necessary. In addition, Tosoh uses an internal carbon price system when formulating capital investment plans, considering not only profitability but also environmental impact.

Climate-related risks are also listed as a key CSR issue, and the CSR Committee reports progress to the board of directors for plan-do-check-action (PDCA) management.

Indicators and Targets

Energy-derived CO₂ emission reduction target: 6% reduction in BAU emissions by fiscal 2026 (compared with fiscal 2014)

Actual GHG emissions in fiscal 2021 (kilotons-CO₂e)

Scope 1 7,628

Scope 2 402

Scope 3 6,638

The current target was established with the approval of the board of directors in March 2019, and is expected to be achieved in fiscal 2024 ahead of schedule. This anticipated success is attributable to investments in energy conservation and process improvements.

Taking into account the government's new Nationally Determined Contribution for carbon neutrality in 2050, we will consider new targets and measures for fiscal 2031.

Basic Concept

To ensure that customers can use our products safely and with peace of mind, the Tosoh Group ascertains accurate information on chemical substances and provides information on the chemical content of its products. Tosoh collects information and shares the latest updates with its complexes, related departments, and Group companies through e-mails, briefings, and educational programs to ensure compliance with Japanese and foreign laws and regulations related to chemical substances.

Enhanced Chemical Substance Management

The 2002 World Summit on Sustainable Development (WSSD) stated its goal as “aiming to achieve, by 2020, that chemicals are used and produced in ways that lead to the minimization of significant adverse effects on human health and the environment.” Countries around the world are enacting or amending laws and regulations toward achieving this goal, requiring chemical manufacturers to manage chemical substances more thoroughly across their supply chains.

In accordance with common global targets set for 2021 and beyond, Tosoh continues to collect information on the enactment and revision of laws and regulations, take appropriate measures, and provide customers with information on chemical substances contained in products. Furthermore, we strive to strengthen chemical substance management and minimize risks throughout the supply chain.

Chemical Substance Management System

In 2016, Tosoh introduced a chemical substance management system to centrally manage chemicals handled within the company and ensure compliance with international laws and regulations. This system involves the creation of a database of the chemical substances contained in each Tosoh product. The database enables us to search for applicable laws and regulations for the product as well as the chemical substances contained within. In addition, Tosoh has certificate-issuing authority for some of its products. As with the database, this allows a rapid response to customers who wish to know the chemical content of those products.

Chemical Substance Risk Management

The JCIA promotes voluntary initiatives by chemical makers in Japan to strengthen chemical management. The initiatives include the Global Product Safety strategy and the Japan Initiative of Product Stewardship. The JCIA's focus is to publish safety summaries—summarized results of risk assessments of chemical products manufactured and sold by a company—for major products. When safety data sheets (SDS) describing the chemical content of products and related hazards are revised, the summaries are reviewed and updated accordingly.

Safety Information Disclosure

The Tosoh Group prepares and provides SDS for all of its products, and has made some of these available on its website to help ensure the safe handling of the products.

Following the Japanese Industrial Standard revisions enacted by the government in May 2019, we are conducting necessary work to revise all SDS within a three-year grace period.

As for the labeling of products under Japan’s Industrial Safety and Health Act, in addition to the products that already contain substances subject to labeling, we are gradually including products that contain hazardous substances.

Legal Compliance

When a new product is released on the market, it has to be reported, registered, and quantified according to each country’s laws and regulations. In fiscal 2021, Tosoh responded appropriately to changes in management methods for newly designated toxic and deleterious substances.

With regard to overseas laws and regulations, we continued to respond to formal registration of the revised K-REACH in South Korea, the country’s Act on Registration and Evaluation, etc. of Chemical Substances. Tosoh also initiated compliance with UK-REACH, the United Kingdom’s law on the registration and evaluation of chemical substances, which became necessary due to the UK's withdrawal from the European Union.

In fiscal 2021, there were no violations of laws and regulations related to the registration and notification of chemical substances.

Product Safety Audits

In accordance with Japan’s Product Liability Act, Tosoh Group employees in Japan work together to ensure product safety and provide appropriate product information. Our Product Safety Review Committee verifies the safety of raw materials and products and deliberates on laws and regulations at each stage from R&D to sales. In fiscal 2021, the committee met 102 times.

Basic Concept

Through its business activities, the Tosoh Group contributes to the development of a sustainable society in which the environment, economy, and society are in harmony, and strives to make effective use of resources to create a recycling-oriented society. We aim to minimize our environmental impact by properly managing air and water emissions, waste, and other important control items generated by our business activities.

The Tosoh Group reduces the environmental impact of its business activities throughout the lifecycle of its products. In manufacturing our products, we make effective use of the input of resources—or “inputs” such as fuel, raw materials, and water resources—and work to minimize waste “outputs” and the degree of our environmental impact on air and water.

Atmosphere Preservation

Tosoh Group domestic companies monitor the concentration and amount of sulfur oxides (SOx), nitrogen oxides (NOx), dust, and other air pollutants emitted by each specific facility. We set voluntary control values that are stricter than those set by Japan’s Air Pollution Control Act and those agreed upon with local governments. In fiscal 2021, those companies did not exceed any legal regulatory or agreed-to values.

For equipment that uses Tosoh's specified chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons (HCFCs) as refrigerants, we are taking action based on environmental laws and regulations, such as Japan’s Ozone Layer Protection Act, along with internal administrative guidelines and trends.

Additionally, in accordance with Japan’s Fluorocarbons Emission Restraining Law, we report the calculated amount of leakage of CFC substitutes to the government in an appropriate manner. We set control targets and use detectors to isolate and repair leaks at an early stage to minimize leakage.

Water Preservation

Tosoh and its Group companies in Japan use wastewater treatment facilities to remove pollutants and recover active ingredients from wastewater. We monitor emissions of chemical oxygen demand (COD), nitrogen, phosphorus, and other substances in accordance with voluntary control values that are stricter than those stipulated by the Water Pollution Control Law and agreements with municipalities. In fiscal 2021, there were no instances where water quality exceeded legal limits or agreed-upon values.

Water is an indispensable resource for the Tosoh Group. Each company in the Tosoh Group strives to make effective use of water input and to maintain and improve the quality of wastewater for the sustainable use of water resources around its manufacturing complexes.

Enrichment Through Education

In addition to holding lectures by experts and municipal authorities in June, designated as Environment Month, the department in charge of environmental management at each manufacturing complex provides on-site education and holds regular liaison meetings with the departments to report on accident cases and inform them of regulations. Group companies are briefed on violations of environmental laws and regulations as well as trends in amendments to environmental laws through the Tosoh Group Safe Work Environment Network.

Industrial Waste

The Tosoh Group promotes the 3Rs—reduce, reuse, and recycle—through resource recycling and other measures. In accordance with the fourth target of Keidanren’s Voluntary Action Plan for Establishing a Sound Material-Cycle Society, Tosoh has set a target of reducing the volume of final waste disposal by approximately 70% compared to the actual volume in fiscal 2000. Tosoh’s final disposal volume in fiscal 2021 was 923 metric tons, well below the target of 1,000 metric tons.

Aware of their responsibilities as generators of waste, Group companies also manage and dispose of waste properly until it is delivered to a disposal company.

Status of Disposal of Equipment Containing PCB

In accordance with Japan’s PCB Special Measures Law, Tosoh and its domestic Group companies are promoting the appropriate disposal of equipment containing PCBs. Tosoh completed disposal of transformers, capacitors, and other equipment containing high concentrations of PCBs by fiscal 2018. In fiscal 2021, we completed disposal of lighting ballasts and other equipment including those containing high concentrations of PCBs. Tosoh will dispose of approximately 50% of all equipment containing low-concentration PCBs by the end of fiscal 2022, and systematically dispose of the remaining equipment by fiscal 2027.

Emission Reduction Measures for Substances Subject to PRTR System

Tosoh and its domestic Group companies are striving to reduce emissions of substances subject to Japan’s Pollutant Release and Transfer Register (PRTR) system by setting voluntary targets. The system is based on Japan’s Act for Confirmation, etc. of Release Amounts of Specific Chemical Substances in the Environment and Promotion of Improvements to the Management Thereof (Law concerning Pollutant Release and Transfer Register), which governs materials that require movement and discharge quantity reporting.

Tosoh’s emissions in fiscal 2021 were 409 metric tons. This was below the target of 424 metric tons or less, a reduction of more than 30% from fiscal 2016. Total emissions by the domestic Group companies were 117 metric tons, a decrease of 16 metric tons from fiscal 2020.

Basic Concept

The chemical products of the Tosoh Group can have a significant impact on ecosystems if they are not properly managed during the manufacturing process. The manufacture of chemical products uses energy, minerals, and water resources, which may have an impact on the entire supply chain. To realize a society in harmony with nature, the Tosoh Group proactively works to preserve biodiversity through our business activities and contributions to local communities.

Community Support and Participation

The Tosoh Group conducts voluntary community-based environmental activities in each region to help promote and support biodiversity according to the action guidelines stated in its Basic Principles Regarding the Environment, Safety, and Health. In fiscal 2019, Tosoh participated in the Private Sector Engagement Partnership for Biodiversity, for which the Keidanren Committee on Nature Conservation serves as secretariat. In addition, Tosoh participated as a founder in the Japan Initiative for Marine Environment, which was established by five chemical industry organizations to solve the problem of marine plastic waste. We also signed the Declaration for Solving the Plastic Marine Debris Problem by The Japan Plastics Industry Federation.

Addressing the Plastic Problem

Tosoh has positioned the promotion of material and chemical recycling as a contribution to society in the reduction of plastic waste. It is promoting the development of recycling technologies through joint research with universities and national research institutes, based on the progress of the circular economy.

As an example, we are participating in a project entitled Developing Liquid-Phase Hybrid Recycling Technologies for Multilayer Plastic Films, which was selected as a leading research project by the New Energy and Industrial Technology Development Organization (NEDO). We are aiming to develop recyclable plastics, and are at the same time actively promoting initiatives to reduce our environmental impact.

Cooperation with Local Authorities

The Nanyo Complex has concluded an agreement with Shunan City in Yamaguchi Prefecture to effectively use branches pruned from trees on the roadside and around the city as woody biomass fuel. The agreement contributes to the effective use of limited resources and the mitigation of global warming. In addition, Tosoh composts the pruned branches and fallen leaves at the Nanyo Complex and uses them to fertilize plants and promote green spaces.

Environmental Protection Activities

The Tosoh Group is promoting community-based environmental protection activities to support the realization of a society in harmony with nature.

Satoyama Preservation Activities

Tosoh's Nanyo and Yokkaichi Complexes are actively involved in local Satoyama Preservation Activities. Every year, the Nanyo Complex participates in the Forestation for Water Conservation Promotion Project organized by Yamaguchi Prefecture, while the Yokkaichi Complex holds Satoyama Preservation Activities organized by the Yokkaichi Nature Conservation Promotion Committee. Although major activities in fiscal 2021 were canceled due to the COVID-19 pandemic, we will continue to promote Satoyama Preservation Activities to maintain the ecosystem.

Community Volunteer Cleanup

Tosoh cleans up areas around its offices as well as beaches and rivers.

At the Yokkaichi Complex, the Kasumigaura Regional Environmental Promotion Association (KIEP'S) was established in 2009 by 31 companies and organizations located in the Kasumigaura area of Yokkaichi City, and continues today to conduct environmental volunteer activities. An example is KIEP'S support for the Mie Prefecture-sponsored Ise Bay Forest, River, and Sea Cleanup Campaign to clean up nearby beaches.

From fiscal 2022, the Tosoh Labor Union will register with KIEP’S.