Environment

Information Disclosure Based on the TCFD Recommendations

At the Aisan Group, we recognize climate change as one of our key management issues. In May 2022, we announced our endorsement of the Task Force on Climate-related Financial Disclosures (TCFD) and made disclosures accordingly. Based on the recommendations of the TCFD, we will advance our analysis and response to the risks and opportunities that climate change presents to our business, and strive to disclose and enhance relevant information.

Governance

The Sustainability Committee, which is chaired by the CRO*, verifies the direction and its appropriateness related to all issues concerning sustainability, including climate change. In addition, the Carbon Neutral Promotion Meeting (meetings held at least once every three months), which is a subcommittee of the Sustainability Committee, formulates, executes, and manages plans related to the climate change issue. At the Sustainability Committee meetings held twice a year, we receive reports from the Carbon Neutral Promotion Meeting, the People Empowerment Promotion Meeting, and the Governance Meeting, and deliberate on their contents. Among the results of these deliberations, important matters are reported to the Board of Directors and the Senior Executive Board.

CRO: Chief Risk Officer

Risk Management

In addition to receiving reports from the Carbon Neutral Promotion Meeting on climate change risks that significantly impact management, the Risk Management Committee of the Aisan Group periodically reviews key risks by collecting opinions from risk owners representing various departments. Additionally, the committee enhances the sharing of incident information, evaluates risk response status, and reports to the Board of Directors as necessary. The Board of Directors oversees the Risk Management Committee, provides necessary guidance and advice, and reviews the effectiveness of its processes at least once a year. Furthermore, should risks materialize, we have established a system to promptly set up a countermeasures headquarters and respond to incidents based on the CRO’s instructions.

Indicators and Targets

In fiscal 2024, the international response to climate change entered a new phase. At COP29, it was emphasized that countries must raise their emission reduction targets to achieve the 1.5°C goal established under the Paris Agreement. Furthermore, Japan’s 7th Strategic Energy Plan outlines the policy challenges and response directions to be addressed going forward to achieve carbon neutral by 2040 and beyond. It emphasizes the necessity of simultaneously realizing three objectives: stable energy supply, economic growth, and decarbonization.
Given this external environment, the Company’s Medium-term Management Plan (2025-2030) is formulating a transition plan to address climate change risks and achieve a sustainable circular society. We are working to reduce greenhouse gas emissions through initiatives such as carbon neutral-related investments utilizing internal carbon pricing (ICP). Furthermore, as a stepping stone to new sectors and future products, we will contribute to solving social issues not only through the evolution of all forms of energy and mobility, but also in domains beyond mobility.

Carbon neutral target (FY2030)

Challenges	Item	Target
Carbon neutral	Scope 1 & 2	-60% compared to FY2019
	Scope 3	-28% compared to FY2019
	Renewable energy ratio	55%
	Energy creation ratio	5%
Circular economy	Zero-waste emissions	-5% compared to FY2019 (intensity)
Nature positive	Water usage	-5% compared to FY2019 (intensity)

For more information on the target values for the entire value chain.

Strategy

Based on the social vision under multiple (1.5°C/2°C/4°C) scenarios^*, risks and opportunities are arranged for fiscal 2050 in addition to fiscal 2030, to assess the financial impact in fiscal 2030, and measures to reduce risks and create opportunities are being taken.

1.5°C/2°C: NZE (Scenario to achieve global net zero emissions by 2050), APS (Scenario that reflects aspirations declared by ambitious countries)
4°C scenario: SSP 5–8.5 (Maximum emissions scenario without implementation of climate policy, under fossil fuel dependent development)

Risks/opportunities and response to climate change

Category		Details		Timescale	Impact level	Aisan Group’s response
Transition risk	Policy / Regulation	Greenhouse gas emissions regulations	Enhanced energy policies and increased manufacturing costs resulting from increased use of renewable energy	Mid- to long-term	Medium	Thorough elimination of wastefulness Global rollout of domestic improvement cases
		Introduction of carbon tax	Increased production cost due to the implementation of carbon tax	Mid- to long-term	Medium	Improvement of energy efficiency Introduction of renewable energy Generation of clean energy by ammonia-hydrogen power generation, etc
		Introduction of carbon tax	Increased procurement costs due to passing on of carbon tax to selling prices	Mid- to long-term	Large	Adoption of low-CO₂ materials Waste reduction and recycling CO₂ emissions improvement activities with suppliers
	Technology	Increased demand for low-carbon/decarbonized products	Delay in recovering investment costs due to delay in transition in new areas	Mid- to long-term	Medium	Business planning for future products that take environmental changes into account, and intensive input of resources
	Market	Shift in customers’ sense of value	Decreased sales in engine parts due to the prevalence of battery electric vehicles (BEVs)^*1	Mid- to long-term	Large	Business growth in new areas which contribute to decarbonization leveraging technologies and strengths
	Reputation	Insufficient environmental initiatives and disclosures	Decline in corporate value and customer trust	Mid- to long-term	Medium	Improving rating agency scores (CDP, etc.) through CO₂ reduction initiatives
Physical risk	Acute	Frequent, severe, and prolonged natural disasters	Temporary production halt due to disrupted supply chain	Mid- to long-term	Medium	Enhancing the BCP structure further Improvement of inventory management precision Continuation of supply chain BCP
Opportunity	Technology	Acceleration of electrification and industry restructuring	Increase in share of core products	Short- to mid-term	Large	Establish advantages over competitors Switch to next-generation unrivaled products Strengthening of manufacturing (Multi-assembly)
	Market	Expansion and development of low-carbon products	Increase in revenue of hydrogen supply units following the expanded application of hydrogen energy	Mid- to long-term	Medium	Promotion of the development of products for next-generation FCVs/hydrogen engines
			Increase in opportunities to enter markets for electrified products due to increase in electric vehicles (BEV/PHEV/FCEV)^*1	Mid- to long-term	Large	Provision of lightweight, high-efficiency, and low-cost systems and components Product development leveraging proprietary technologies Establishment of a new plant to produce future products Product development for compact mobility
			Expanding business opportunities in new areas of carbon neutral	Mid- to long-term	Small	Research and development of new technologies and new areas Components for ammonia supply system Compact FC module
			Growing demand for products that contribute to lower emissions	Mid- to long-term	Medium	Development of products for vehicles applying existing technologies (FFV^*2 technology) Products compatible with synthetic fuels/biofuels

[Timescale] Short-term: through 2025; Mid-term: through 2030; Long-term: through 2050
[Impact level] Impact on single-year operating profit: Large, 2.0 billion yen or more; Medium, 0.1 billion yen to less than 2.0 billion yen; Small, less than 0.1 billion yen
[Aisan Group’s response] We have incorporated plans for decarbonization and initiatives for mitigating risks and creating opportunities related to climate change in the Medium-term Management Plan announced in February 2025 and are promoting activities accordingly.

Assumption of the number of units is calculated based on the 2°C scenario
FFV: Flexible-fuel vehicle

For more information on Aisan Group’s response.

Return to ESG top