Climate Change
Approach to Climate Change
In October 2020, the Japanese government declared its goal to achieve carbon neutrality by 2050. With this as a starting point, the transition to a carbon-free society is accelerating in Japan. Companies are required to incorporate environmental factors, such as climate change, into their business strategies, aiming for decarbonization. This is essential for companies to contribute to the achievement of the SDGs and continue to grow together with society. Based on the TCFD*1 recommendations, the SHIONOGI Group has built a company-wide governance system, considering climate change countermeasures as part of its management strategy. After identifying and assessing risks and opportunities in the medium- to long-term business environment, we will promote efforts to reduce risks and create business opportunities.
*1 Task Force on Climate-related Financial Disclosures: An organization established by the Financial Stability Board (FSB) in response to a request from the G20 to discuss how climate-related information should be disclosed and how financial institutions should respond.
SHIONOGI Group Climate Change Countermeasure Targets
We conducted a detailed assessment of the impact of climate change on the SHIONOGI Group’s business, using the TCFD framework as a reference, and considered strategies and specific countermeasures. Consequently, we have set “GHG (CO2) emissions reduction” as a metric for reducing risks related to climate change. In response to this, we have also set targets in our medium- to long-term action targets “SHIONOGI Group EHS*2 Action Targets.”
In addition, to respond to the Japanese government’s declaration of “Carbon Neutrality by 2050” and the worldwide movement toward reducing CO2 emissions, the SHIONOGI Group has established SBTs*3 as the FY2030 GHG emissions reduction targets, aiming to achieve carbon neutrality by 2050. These targets were approved by the SBT Initiative in June 2021 (see this page for details).
*2 EHS: Environment, Health and Safety
*3 SBTs (Science Based Targets): CO2 emissions reduction targets based on scientific data
* Targets approved by the SBT initiative
Results of Major Initiatives Related to Climate Change
Reducing our Scope 1 and 2 emissions
To achieve our FY2030 targets, we worked to reduce CO2 emissions by gradually introducing electricity derived from renewable energy mainly to the SHIONOGI Group’s major sites, such as plants and research laboratories. As a result, we achieved our CO2 emissions reduction target for FY2022. We also completed the introduction of renewable energy-derived electricity to the head office building in FY2021 and to the Aburahi Research Center in FY2022 based on a plan to switch to renewable energy-derived electricity for the SHIONOGI Group’s major sites. In FY2023, in response to an increase in electricity consumption due to business growth, which led to a tendency for CO2 emissions to exceed our plan, we not only introduced renewable energy-derived electricity to the Shionogi CMC Research Innovation Center (CRIC), as originally planned, but also brought forward its introduction to the Shionogi Pharmaceutical Research Center (SPRC). With this, we have completed the introduction of renewable energy-derived electricity to Shionogi’s major sites. Going forward, we will promote the introduction of renewable energy-derived electricity to the plants of Shionogi Pharma, which is responsible for the production-related functions of the SHIONOGI Group. We plan to complete its introduction to all major sites of the SHIONOGI Group by 2030.
Plan for introducing electricity derived from renewable energy
| Switching fiscal year | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Site | Head Office | Aburahi | CRIC SPRC |
Settsu | - |
| Switching fiscal year | 2026 | 2027 | 2028 | 2029 | 2030 |
|---|---|---|---|---|---|
| Site | Tokushima | Kanegasaki | UMN Pharma |
Itami | Nanjing |
Moreover, to improve energy efficiency, we have set targets for improving energy intensity by 1% per year and introducing equipment with high energy consumption efficiency. In addition to promoting the introduction of high energy-efficient equipment, we promote initiatives, such as continuously reviewing equipment operation modes, to reduce energy consumption. However, in FY2022, we were unable to achieve our FY2022 targets due to an increase in energy consumption, because continuing from FY2021, we not only actively worked on COVID-19-related research and development, but also implemented the manufacture of COVID-19 therapeutic drugs with the aim of promptly supplying them after approval.
Vehicles for sales activities
To reduce CO2 and exhaust gas emissions by improving fuel efficiency, Shionogi has promoted the introduction of hybrid vehicles (HVs) to be rented for our medical representatives (MRs), and has completed their introduction in areas other than snowy cold regions. As a result of progressively introducing HVs in snowy cold regions, we have completed their introduction in all regions of Japan during FY2022.
Moreover, due to the spread of the COVID-19 pandemic and the promotion of DX in medical information provision activities, we have shifted from face-to-face to online approaches. Consequently, fuel consumption remained lower in FY2022 than in FY2019, before the spread of COVID-19.
Reducing our Scope 3 emissions
Scope 3 emissions of the SHIONOGI Group account for about 60% of total emissions. It is essential to work with suppliers to reduce CO2 emissions throughout the supply chain in order to achieve its SBTs. Among our Scope 3 emissions, Category 1 (purchased goods and services) emissions account for more than 50%. To reduce CO2 emissions in this category, we have set a medium-term target on a priority basis to consider and implement countermeasures.
The calculation methods are as indicated in the “Basic Guidelines on Accounting for Greenhouse Gas Emissions Throughout the Supply Chain (Ver. 2.5)” of the Ministry of the Environment and the Ministry of Economy, Trade and Industry of Japan.
*Since FY2022, CO2 emissions in Categories 1 and 2 of Scope 3 have been calculated using the emission intensity based on prices including consumption tax. In line with this, GHG emissions in or before FY2021 have been recalculated using the emission intensity based on prices including consumption tax.
The SHIONOGI Group has participated in the Fiscal Year 2021 Model Project for Supporting Achievement of the Decarbonization Targets of the Entire Supply Chain, which is a project of the Ministry of the Environment aimed at helping companies achieve their GHG emissions reduction targets for the entire supply chain, and has formulated measures to reduce CO2 emissions throughout the supply chain. We have built a collaborative system, including Group companies, to promote supplier engagement, and have implemented the supply chain engagement process*6 formulated in this project in order to achieve our SBTs.
In FY2022, we conducted supplier engagement activities for our top 21 suppliers by purchase amount, including checking the status of their efforts to reduce CO2 emissions and holding briefing sessions to promote their understanding of the SHIONOGI Group’s policy on climate change. In the future, we will select important suppliers for CO2 emissions reduction to ask them to reduce their CO2 emissions, and support their efforts on a priority basis.
＊6 See the Guidebook for Formulating a GHG Emissions Reduction Plan to Achieve the SBTs for more information on the supplier engagement process created under this project. (Japanese version only) (External website)
External Activities for Addressing Climate Change
Selected as an A List Company in CDP Climate Change 2022
In the Climate Change Report 2022 published by CDP, an international non-profit organization that works on environmental information disclosure, we received the highest rating of A. Representative Director, President and CEO Isao Teshirogi delivered a speech on the SHIONOGI Group’s initiatives for environmental protection as a representative of the company that had achieved a double A rating in “Water Security 2022” and “Climate Change 2022.”
In the speech, he expressed the SHIONOGI Group’s intention to promote business transformation to create new healthcare solutions and deliver them globally, and at the same time to grow as a company needed by society while realizing a sustainable society through efforts to preserve the global environment.
Speech video (Message from the manager of an A List Company) (External website)
Support for the messages from the Japan Climate Initiative (JCI)
The Japan Climate Initiative (JCI) is a network aimed at realizing a decarbonized society by enhancing information dissemination from and exchange of views between companies, local governments, and NGOs that are actively involved in climate change initiatives in Japan. The SHIONOGI Group participated in the JCI in April 2021. As a member company, SHIONOGI expressed its support for all five messages/proposals published by the JCI to the Japanese government.
“JCI’s Message：JCI calls on the Japanese government to set an ambitious 2035 target that is consistent with the 1.5-degree goal” (External website)
The SHIONOGI Group has set its SBTs as medium- and long-term targets and is working daily to reduce its CO2 emissions. Believing that expanding access to renewable energy will be an effective means of achieving the targets, we strongly support the JCI messages.
Our efforts to combat AMR, which could spread further due to climate change
The SHIONOGI Group’s efforts against AMR (antimicrobial resistance) are presented on the website “Climate Change Adaptation Information Platform (A-PLAT)” operated by the National Institute for Environmental Studies, Japan.
See the section “AMR” for more information on the SHIONOGI Group’s AMR initiatives.