Addressing Climate Change

Reduction of CO2 Emissions

CO2 and fluorocarbons are the main causes of global warming. The reduction of these emissions is therefore a global issue. The Taisho Pharmaceutical Group is engaged in reducing the emission of CO2 and fluorocarbons as a company with responsibility for dealing with climate change.

Objectives
  • Reduce the amount of CO2 emissions (Scopes 1 & 2) by 25% by the fiscal year ending March 31, 2031 compared to CO2 emissions in the fiscal year ended March 31, 2014*
  • Reduce the average amount of CO2 emissions from offices in Saitama Prefecture from fiscal 2015 to fiscal 2019 by 13% compared with the baseline year
  • * Basis for setting target year: Target fiscal year prescribed in Japan’s Intended Nationally Determined Contribution (INDC) (July 2015)
    Basis for setting target figures: “The Commitment to a Low Carbon Society” issued by The Federation of Pharmaceutical Manufacturers’ Associations of Japan

Total Emission Volume from Offices in Japan (Scopes 1 & 2)

In fiscal 2018, we undertook measures such as upgrading to equipment with higher energy efficiency focused on factories and research centers in Japan and reviewing the conditions for using air conditioning. CO2 emissions increased by 4.4% compared with the baseline year, but decreased by 4.7% compared to the previous fiscal year. Because emission coefficients for electricity increased in fiscal 2018 compared with the baseline year, CO2 emissions also increased. However, usage amounts for electricity and fuel are being reduced compared with the baseline year.

CO2 Emissions (Scopes 1 & 2) and Basic Unit of CO2
Fiscal year 2013 (baseline year) 2015 2016 2017 2018
Scope 1*1, *2(t-CO2) 26,236 24,919 26,295 27,201 25,766
Scope 2*1, *3(t-CO2) 30,028 35,248 36,149 34,402 32,956
Total (t-CO2) 56,264 60,167 62,444 61,603 58,723
Amount of CO2 emissions compared to fiscal 2013 106.90% 111.00% 109.50% 104.40%
Basic unit of CO‏2 emissions*4
(t-CO2/net sales (millions of yen))
0.190 0.207 0.223 0.220 0.225
  • *1. Gas used for calculation: Energy-derived CO2
    Coefficient used for calculation: As stipulated by the Act on Promotion of Global Warming Countermeasures
    Scope of calculation: Offices in Japan (Taisho Pharmaceuticals Head Office, branches, distribution centers, factories and research centers)
  • *2. Direct greenhouse gas emissions produced by a company
  • *3. Indirect greenhouse gas emissions from consumption of purchased electricity, heat and steam
  • *4. CO2 emissions (Output (Scope 1 + Scope 2) / Sales (consolidated))
Overseas Factory CO2 Emissions (Scopes 1*1 & 2*1, *2)
  2015 2016 2017 2018
PT. Taisho Pharmaceutical Indonesia Tbk Scope 1 678 678 263 325
Scope 2 1,880 1,813 1,798 2,020
Total(t-CO2) 2,558 2,491 2,061 2,345
Taisho Pharmaceutical (M) SDN. BHD. Scope 1 0 0 0 0
Scope 2 1,658 1,685 1,899 2,042
Total(t-CO2) 1,658 1,685 1,899 2,042
Taisho Co., Ltd. Shanghai Scope 1 445 488 526 566
Scope 2 507 508 521 581
Total(t-CO2) 952 997 1,047 1,148
Hoepharma Holdings Sdn. Bhd. Scope 1 144 116 175 189
Scope 2 364 340 395 393
Total(t-CO2) 508 456 570 582
Taisho Vietnam Co., Ltd. Scope 1 10 20 14 13
Scope 2 304 322 389 406
Total(t-CO2) 314 342 403 420
Compañía Internacional de Comercio, S.A.P.I. de C.V. (CICSA) Scope 1 24 95 16 15
Scope 2 560 536 537 481
Total(t-CO2) 584 632 552 496
Total Scope 1 1,301 1,398 993 1,110
Scope 2 5,272 5,206 5,537 5,923
Total(t-CO2) 6,574 6,603 6,530 7,033
  • *1. Gas used for calculation: Energy-derived CO2
    Coefficient used for calculation: Taken from “CO2 emissions from fuel combustion 2018”
  • *2. Location-based method

Scope 3 CO2 Emissions

CO2 in the value chain (Scope 3) and basic unit of CO2 emissions
Category CO2 emissions
(t-CO2)
Method of calculation
FY2017 FY2018
Scope 1*1 27,201 25,766 Global warming potential based on “Act on Promotion of Global Warming Countermeasures”
Scope 2*2 34,402 32,956
Scope 3*3, *4      
1. Purchased products & services 56,110 51,107 Calculated by aggregating each purchased raw material, then multiplying by the basic unit
2. Capital goods 13,745 14,883 Calculated by multiplying the amount of capital investment in the fiscal year by the basic unit
3. Fuel and energy-related activity not included in Scope 1 & 2 2,447 2,414 Calculated by multiplying the amount of used electricity/heat by the basic units for the amount of energy used
4. Transportation, delivery (upstream) 9,508 9,704 Calculated by multiplying the delivery volume from suppliers to factories, between factories, and from factories to shipping destinations by the basic unit
5. Waste from business activities including manufacturing 3,743 2,953 Calculated by categorizing the waste generated by factories and research centers by treatment, then multiplying the weight of treated waste by the basic unit
6. Business trips 754 703 Calculated by multiplying the expense amount supplied to use aircraft (domestic and overseas) by the basic unit
7. Employee commuting 2,157 2,065 Calculated by multiplying the expense amount supplied for commuting expenses for each mode of transportation by the basic unit
8. Leased assets (upstream) Outside scope of calculation
9. Transportation, delivery (downstream) Outside scope of calculation
10. Manufacturing of sold products Outside scope of calculation
11. Usage of sold products Outside scope of calculation
12. Waste of sold products 930 889 Calculated by multiplying the usage amount of each material at the time of application under the Containers and Packaging Recycling Act by the basic unit
13. Leased assets (downstream) Outside scope of calculation
14. Franchises Outside scope of calculation
15. Investments Outside scope of calculation
Basic unit of CO2 emissions (Scope 3)*5
(t-CO2/net sales (millions of yen))
0.319 0.324  
Basic unit of CO2 emissions (total)*6
(t-CO2/net sales (millions of yen))
0.539 0.548  
  • *1. Direct greenhouse gas emissions produced by a company
  • *2. Indirect greenhouse gas emissions from consumption of purchased electricity, heat and steam
  • *3. Indirect greenhouse gas emissions not covered in Scopes 1 & 2
  • *4. Gas used for calculation: Energy-derived CO2
    Coefficient used for calculation: From the emission basic unit database (ver. 2.5) for organizations to use when calculating greenhouse effect gas emissions generated throughout their supply chains.
    Scope of calculation: Offices in Japan (Taisho Pharmaceuticals Head Office, branches, logistics branches, factories and research centers)
  • *5. CO2 emissions (Scope 3) / Sales (consolidated)
  • *6. CO2emissions (Scope 1 + Scope 2 + Scope 3) / Sales (consolidated)
CO2 Emission Volume Associated with Sales and Transport, etc.
Fiscal year 2014 2015 2016 2017 2018
Sales (t-CO2) 4,014 3,923 4,827 6,211 5,768
Logistics (t-CO2) 7,132 7,074 6,889 6,534 6,361

Regulation on Saitama Prefecture Global Warming Strategy Promotion Ordinance (Offices in Saitama Prefecture)

Approximately 80% of Taisho Pharmaceutical’s CO2 emissions are produced within Saitama Prefecture, including the Omiya and Hanyu factories, along with the Research Center.

At offices in Saitama Prefecture, we are pursuing a reduction in the average amount of CO2 emissions by 13% for the second plan period (fiscal 2015 to fiscal 2019) when compared to the baseline year (average from fiscal 2002 to fiscal 2004) with a system for planning global warming countermeasures in accordance with Regulation on Saitama Prefecture Global Warming Strategy Promotion Ordinance.

During fiscal 2018, efforts to improve energy efficiency at the Hanyu Factory resulted in a 14.2% reduction in CO2 emissions, compared to the previous fiscal year. The average annual rate of reduction in the second planning period is 12.2%.

Trends in the Amount of CO2 Emissions for the Second Plan Period for Global Warming Countermeasures
Fiscal year Baseline year
(2002–2004)
2015 2016 2017 2018
Emissions*(t-CO2) 48,275 42,149 43,265 42,691 41,444
Reduction rate (%) 12.7 10.4 11.6 14.21
Average reduction rate in the 2nd planning period (%) 12.2
  • * The calculation for CO2 emissions uses emission coefficients presented in the Regulation on Saitama Prefecture Global Warming Strategy Promotion Ordinance

Participation in FPMAJ’s Low-Carbon Society Project

To contribute to a low-carbon society, Taisho Pharmaceutical is participating in the Low-Carbon Society Project led by the Federation of Pharmaceutical Manufacturers’ Associations of JAPAN (FPMAJ).

Promotion of Environmentally Friendly Offices

Objectives
Taisho Pharmaceutical will work on improving the energy consumption rate*1, and will continue to receive “A-class or higher”*2 in evaluation system by class under the Energy Conservation Law
  • *1. Energy consumption rate
    Factories, research centers: Energy consumption (kL) / Number of production lots (hundred million) {or production (hundred million yen)} x Floor area (m2)
    Sales and back offices: Energy consumption (kL) / Floor area (m2)
  • *2. In order to continue to receive “A-class or higher,”
    the following conditions have to be avoided:
    · Energy consumption rate of 100% or more for two consecutive years
    · Average consumption rate is 105% or more for five consecutive years

Taisho Pharmaceutical will continue to work on eliminating CO2 emissions in the medium and long terms, and also on improving the energy consumption rate, for the purpose of using limited energy.

In fiscal 2018, we established units to measure the energy consumption rate at each workplace for production divisions, and undertook mechanisms to measure energy efficiency at each workplace every month. With this initiative, we were able to improve our awareness of wasted energy and implement countermeasures. As a result, we improved the energy consumption rate throughout the entire Company by 1.4% year on year, and we were able to maintain a Class A ranking in the evaluation system under the Energy Conservation Law, which is a Company goal.

Change of Energy Consumption Amount (Calorific Value) and Energy Consumption Rate
Fiscal year 2014 2015 2016 2017 2018
Energy consumption (heating value MJ) 1,062 1,060 1,091 1,074 1,044
Energy consumption rate compared to the previous fiscal year (%) 99.9 100.3 96.5 106.5 98.6
Average consumption rate for 5 fiscal years (%) 100.5
Measures to Save Energy and Reduce CO2 Emissions in Fiscal 2018
  Measures
Taisho Pharmaceutical Company 1) Upgraded to higher-efficiency equipment
2) Applied LED lighting and turned certain lights off
3) Conducted Cool-Biz Campaign
4) Participated in Lights-Down Campaign
Production and Logistic Headquarters 5) Reviewed manufacturing equipment and air conditioning
6) Upgraded to higher-efficiency equipment
7) Improved activities to combat energy loss (air leak, heaters)

Promotion of Environmentally Friendly Logistics Operations

Objectives
Reduce average annual energy consumption associated with transport by 1% or more by the fiscal year ending March 31, 2019

The annual amount Taisho Pharmaceuticals transports as a cargo owner is 30 million ton-km or more, so we fall under the category “Specified Shippers” in the Energy Conservation Law. We are undertaking activities that include promoting a modal shift (changing transportation methods to reduce environmental load), reducing transportation frequency, and improving fuel efficiency to reduce energy consumption during transportation.

The energy consumption rate in fiscal 2018 increased by 1.3% compared with the previous year, and decreased by 0.3% on average over the five-year period. In line with the decrease in shipments in fiscal 2018, the Company’s use of large-scale freight trucks also decreased, and the proportion of shipments transported by railroad declined due to the effects of the torrential downpours in western Japan in July 2018. On the other hand, we are steadily promoting a modal shift by increasing the amount we transport by ship by 8.0% year on year.

Energy Consumption Rate and Specific Energy Consumption Associated with Transport
Fiscal year 2014 2015 2016 2017 2018
Energy consumption (converted to crude oil) (kL) 2,702 2,690 2,626 2,494 2,413
Transportation amount (10,000 ton-km) 8,104 8,000 7,934 7,507 7,169
Energy consumption rate* 0.333 0.336 0.331 0.332 0.337
Average consumption rate for 5 fiscal years (%) 100.3
  • * Energy consumption rate: Energy consumption (kL) / Amount transported (10,000 ton-km)

Control of Fluorocarbon Emissions

Objectives
  • Comply with the act (simple inspections, periodic inspections, report on calculated leaks),
  • provide education to fluorocarbon managers Companywide and reduce leaks

To ensure compliance with the Act on Rational Use and Proper Management of Fluorocarbons, we have established a Groupwide system for managing devices using fluorocarbons, etc. and have selected a general manager and assigned responsible managers and management representatives at respective offices to form a system that allows systemized management.

Amount of Fluorocarbons Leaked
Fiscal year 2016 2017 2018
No. of incidents 18 17 9
Amount of fluorocarbons leaked (t-CO2e) 807 474 63