Preventing Climate Change
Information Disclosure Based on Recommendations from the TCFD
(Task Force on Climate-related Financial Disclosure)
The NST Group has established “contributing to a decarbonized society and environmental conservation” as one materiality related to ESG management. By reducing CO2 emissions, proposing eco-solutions through our business, and other means, with the goal of becoming carbon neutral in 2050, we are aiming to achieve both preservation of the global environment and economic activity, and contribute to the creation of a sustainable society. In May 2022, we announced our agreement to the TCFD recommendations, and we have been carrying out information disclosure in line with the TCFD framework in order to clearly communicate information about the risks and opportunities of climate change in our business to all our stakeholders.
Governance
From the perspective of promoting sustainability, Nippon Steel Trading has constructed a Sustainability Promotion System intended to improve corporate governance, enhance ESG management, and further strengthen risk management. As part of this, the ESG Committee that is chaired by the President is held twice every year, and we consider basic policies and measures related to promotion of our ESG management, including matters related to climate, comprehensively and across the entire NST Group. The Environment Meeting is a subordinate body of the ESG Committee and carries out implementation and follow-up of various climaterelated and other measures. The issues considered and discussed by the ESG Committee are reported to and discussed by the Management Meeting and Board of Directors at least once each year. The Board of Directors carries out regular supervision of this process, and provides instructions for action as necessary.
Strategies
The TCFD recommendations include performing analysis based on multiple climate scenarios when disclosing strategies. At present, in our primary business area of steel, our company analyzes risks and opportunities, and studies the impact on our business, based on two scenarios: one scenario in which the measures necessary are carried out to limit the average rise in global temperatures to less than 1.5°C compared to pre-industrial revolution times, and one scenario in which these measures are not carried out and global average temperatures rise by 4°C.
Risk management
NST identifies the risks and opportunities resulting from climate change at the Environment Meeting, and operates an effective PDCA (plan, do, check, act) management cycle in order to carry out improvements. For identification, analysis, assessment, and action in response to climate change risks and opportunities, an internal cross-organizational project team (hereafter, the “TCFD Action Study Team”) has been established and is conducting studies. The ESG Committee considers and discusses the risks and opportunities which were identified by the TCFD Action Study Team, and then reports the results for discussion by the Management Meeting and Board of Directors.
Indexes and targets
In May 2021, the NST Group identified six priority issues (materiality) related to ESG management, one of which is “contributing to a decarbonized society and environmental conservation.” We have decided CO2 emission reduction targets consisting of a 30% reduction (as compared to fiscal 2018) in fiscal 2030 and achieving carbon neutrality in fiscal 2050, and are taking action to eliminate carbon emissions.
Preventing Climate Change
Previous efforts
CO2 emission results (thousand t-CO2)
CO2 emissions (Scope1, Scope2) resulting from energy use in business operations of the NST Group are as shown below.
Scope: NST and consolidated subsidiaries in Japan and overseas
| FY2018 | FY2019 | FY2020 | FY2021 | |
|---|---|---|---|---|
| Scope1 (direct emissions) |
7.0 (21%) |
7.2 (22%) |
5.8 (21%) |
6.8 (22%) |
| Scope2 (indirect emissions)*1 |
26.2 (79%) |
25.5 (78%) |
22.4 (79%) |
23.5 (78%) |
| Scope1+2*2 | 33.2 | 32.7 | 28.2 | 30.3 |
- *1In the NST Group, indirect CO2 emissions (Scope2) resulting from electrical power use at companies in Japan and overseas account for approximately 80% of total emissions.
- *2As a result of the merger of the NST Textiles Division and Mitsui Bussan I-Fashion Ltd. in January 2022, the numbers have been retroactively corrected (excluding the amount from the Textiles segment) for the transition period (FY2018 – FY2020).
Roadmap for CO2 emissions reduction
The NST Group has created a roadmap for CO2 emissions reduction up to 2030, aiming to achieve our Medium- to Long-Term environmental targets.
Because approximately 80% of CO2 emissions in the NST Group are due to the use of electrical power, we will carry out a range of energysaving measures, systematically switch to power from renewable energy sources, and utilize environmental certificates (non-fossil fuel certificate, J-Credit, etc.) as we aim to achieve the targets.
