Sustainability Vision “TSV2050/2030”

The Toyo Ink Group established the Sustainability Vision “TSV2050/2030” in January 2022 to be long-term practical targets for our CSR and sustainability activities. We set this vision to respond to recent global trends regarding climate actions, carbon neutrality, and initiatives for the achievement of the SDGs, as well as the current social situation which requires that companies fulfill increasing demands for sustainability.

図:TOYO INK GROUP Sustainability Vision/FY2022/Present/SIC27/FY2030/TSV2030/2050 milestone/Contributing to the achievement of the SDGs/FY2050/TSV2050/Achievement of carbon neutrality/1. Providing products and services that realize a sustainable society/2. Reducing the environmental impact of manufacturing/3. Building a foundation for trust

The Sustainability Vision TSV2050/2030 established by the Toyo Ink Group consists of TSV2050, for which 2050 has been set as the target year, and TSV2030 which is a milestone toward TSV2050, for which 2030 has been set as the interim target year.
TSV2050 is a basic vision for the promotion of an array of sustainability activities with a focus on the achievement of carbon neutrality by 2050, which is a goal that we declared in the SIC-II medium-term management plan. In contrast, TSV2030 is a milestone on the road to achieving TSV2050 and an interim target to drive our contribution as a corporate group to the achievement of the Sustainable Development Goals (SDGs) advocated by the United Nations. TSV2030's target year is 2030.

Consisting of these two targets, TSV2050/2030 has three pillars: providing products and services that realize a sustainable society, reducing the environmental impact of manufacturing and building a foundation for trust. These pillars are a direction for the Toyo Ink Group's provision of value. They form the foundation of all of the Group's initiatives related to CSR, sustainability, and ESG.

1. Providing products and services that realize a sustainable society

図:1. Providing products and services that realize a sustainable society/TSV2030/The percentage of sales from sustainability-enhancing products will be 80%/Increasing the number of products able to contribute to the reduction of CO2 emissions throughout their lifecycle/TSV2050/Making all products sustainability-enhancing products/Helping customers achieve decarbonization 図:図:1. Providing products and services that realize a sustainable society/TSV2030/The percentage of sales from sustainability-enhancing products will be 80%/Increasing the number of products able to contribute to the reduction of CO2 emissions throughout their lifecycle/TSV2050/Making all products sustainability-enhancing products/Helping customers achieve decarbonization

1-1. Making all products sustainability-enhancing products

The Toyo Ink Group began our efforts to improve the environmental friendliness of our products in the early days of the Group. In the 1990s we started releasing environmentally friendly products. In recent years, our product development has been focused on environmental value and also the comfort in people's lives, their health and welfare, and safety and reliability. These efforts have enabled us to launch a diverse array of products that are able to contribute to the enhancement of the sustainability of society, thus providing lifestyle value.
We saw the formulation of the TSV2050/2030 as an opportunity to add criteria for products with lifestyle value to our existing criteria for environmentally friendly products and redefined them as Toyo Ink Group Sustainability-Enhancing Products. As a result of this expanded definition, products with functions and features with diverse lifestyle value, including materials related to digital technologies for IoT and high-speed communication and sensor materials (impacting the safety of autonomous driving and the comfort of residential environments) as well as biomedical materials (medical care, drug discovery, and healthcare).

At the Toyo Ink Group, we have set a quantitative target of increasing the ratio of the sales of these sustainability-enhancing products to the net sales of the entire Group to 100% globally by 2050. In addition, we have set the interim target of achieving a 0.8:1 ratio by 2030.

Environmental value and lifestyle value defined for sustainability-enhancing products, their direction, and examples

Provided Value

Direction

Keywords

Example of measures

Environmental value

Building a society that co-exists in harmony with the environment

Container / package area

Reduce

Reducing the  percentage of petroleum raw materials and replacing them (shifting to biomass, water-based materials, UV/EB-cured inks)

Replace

Simplification of product mix, replacement with paper (biodegradable materials, functional coatings)

Recycle

Materials and systems that support the recycling of plastics (materials and systems supporting horizontal recycling)

Mobility / energy area

Shift to EV-based transportation

Proposal and advanced development of materials and technologies that contribute to the acceleration of the shift to EVs (LiB materials, thermal control materials and components)

Clean energy / new energy

Developing environmentally friendly new power generation systems and proposing materials for these systems

Carbon recycling

Developing Carbon Capture, Usage and Storage (CCUS) technologies, utilizing CO2-derived raw materials

Lifestyle value

Realizing a comfortable, healthy and safe society

Medical / healthcare area

Prevention / diagnosis

Development of diagnostic materials and systems which lead to the early detection and prevention of diseases and the reduction of risk of being affected by diseases

Medical treatment

Development of pharmaceutical and medical materials which contribute to advanced therapies and self-care

Safety / security

Provision of safe, reliable products which do not affect living bodies (do not contain harmful substances)

Communication / Electronics / Digital area

High-speed, large-capacity communication

Development of next-generation materials which support photonics, high-speed, large-capacity transmission, and high-speed computing

Advanced sensing

Provision of key materials aimed at the development of a sensor society and a society connected via IoT

Big data

Developing technologies which lead to a convenient society based on the utilization of data

1-2. Helping customers achieve decarbonization

Helping customers achieve decarbonization, which is the other target, reflects our commitment to our corporate customers who aim to reduce their use of carbon, decarbonize, and reduce their CO2 emissions as we are doing within the Toyo Ink Group. When the products sold by the Toyo Ink Group, a B2B material manufacturer, are seen from the perspective of the product lifecycle or the overall supply chain, the Group is positioned upstream in the supply chain from the customer's perspective. The CO2 emissions from our production activities and corporate activities greatly affect our customers' CO2 emissions, especially the CO2 emissions related to raw materials (Scope 3, Category 1).

To support and cooperate with customers' efforts to reduce their use of carbon, decarbonize, and reduce their CO2 emissions as their supplier, we develop products through the consideration of efficient, low-carbon transportation, the reduction of energy and fuel consumption in our customers' product manufacturing, and ease of recycling for the consumers disposing of the products, in addition to the reduction of CO2 emissions from our products themselves (such as by selecting low-carbon raw materials and using low-carbon energy in manufacturing), thus driving the reduction of CO2 emissions throughout the supply chain.

2. Reducing the environmental impact of manufacturing

図:2. Reducing the environmental impact of manufacturing/TSV2030/CO2 emissions: 35% reduction in Japan (from the fiscal 2020 level), 35% reduction in other countries (compared to the fiscal 2030 BAU)/Amount of waste treated off-site (Japan): 50% reduction (from the fiscal 2020 level)/Harmful chemical substance emissions (Japan): 30% reduction (from the fiscal 2020 level)/TSV2050/Achieving net zero CO2 emissions from production activities and minimizing their environmental impact/Minimizing waste generation/Realizing sustainable water use 図:2. Reducing the environmental impact of manufacturing/TSV2030/CO2 emissions: 35% reduction in Japan (from the fiscal 2020 level), 35% reduction in other countries (compared to the fiscal 2030 BAU)/Amount of waste treated off-site (Japan): 50% reduction (from the fiscal 2020 level)/Harmful chemical substance emissions (Japan): 30% reduction (from the fiscal 2020 level)/TSV2050/Achieving net zero CO2 emissions from production activities and minimizing their environmental impact/Minimizing waste generation/Realizing sustainable water use

2-1. Achieving net zero CO2 emissions from production activities and minimizing their environmental impact

The Toyo Ink Group has been striving to reduce CO2 emissions from our production bases in Japan and other countries since we launched the CO2 Reduction Project in fiscal 2010. Guided by the SIC27 long-term corporate vision we started in fiscal 2018, we set a new medium- and long-term environmental goal. The goal is to reduce CO2 emissions in Japan by 26% by fiscal 2030 (from the fiscal 2013 level). We also used the backcasting method to set science-based interim targets for the final years of the three-year medium-term management plans.

Thanks to omnidirectional reforms aimed at achieving these goals, our CO2 emissions in Japan in fiscal 2020 were 76,843 t-CO2, which is far below the target of 78,600 t-CO2 for the final fiscal year of SIC-III (fiscal 2026).  In response, following the SIC-II medium-term management plan launched in fiscal 2021, we declared that we would achieve carbon neutrality by fiscal 2050 as a higher-level target and set this as the central target of TSV2050.

In TSV2030, the milestone toward TSV2050, we set the target of reducing CO2 emissions in Japan by 35% from the fiscal 2020 level, to 50,000 t-CO2, a 50% reduction from the fiscal 2013 level. Our measures to achieve this target can be classified into three aspects, the reduction of energy consumption, the shift to low-carbon energy, and the shift to low-carbon power. In addition, we have defined carbon offsetting through emissions trading as one of our strategic options. We are also eying negative emissions (initiatives to reduce emissions to a negative value) in the future.

Example of measures for reducing CO2 emissions

Direction

Example of measures

Reduction of energy consumption

Energy conservation (eliminating energy loss in processes), production process reform implemented from the perspective of saving energy

Shift to low-carbon energy

Electrification of production equipment (reducing direct emissions), preparation and research for the use of LNG alternative fuels

Shift to low-carbon power

Introducing low-carbon power and renewable energy equipment

Carbon offset

Offsetting emissions through emissions trading

Negative emissions

Preparation and research for the development and use of CCUS and other technologies

図:CO2 emissions in Japan (thousand tons)/FY2020 76,843 tons-CO2/FY2030 50,000 tons-CO2/down 35% from FY2020 level
図:Overseas CO2 emissions (thousand tons)/FY2020 118,786 tons-CO2/FY2030 95,000 tons-CO2/down 35% from FY2030 BAU level

However, regarding CO2 emissions from our overseas locations which are key bases for the future growth of our business, we have set the target of 95,000 t-CO2, which is a 35% reduction from the fiscal 2030 BAU level.* At overseas locations, we will focus our efforts on the shift to low-carbon power because the ratio of indirect emissions is higher (the energy mix is shifting to electricity rather than fuels) than in Japan.

BAU level: Level of emissions assumed if no countermeasure have been taken to prevent the increase of CO2 emissions resulting from the growth of business ("business as usual" emissions)

2-2. Minimizing waste generation

Since the 1970s, when the Waste Disposal Act (Act on Promotion of Recycling of Small Waste Electrical and Electronic Equipment) came into force in Japan, the Toyo Ink Group has been advancing measures to control the waste emissions from our business activities and recycle waste, in our efforts to reduce waste emissions and achieve zero emissions at all of our business locations.*
The amount of waste treated off-site in Japan in fiscal 2020 was 10,822 t.* To break this down, waste oil was 55%, waste plastics was 12%, and wastewater was 10%, so the top three types of waste were approx. 80% of total waste. We will effectively move forward with measures by focusing on these types of waste, aiming to reduce the amount of waste that is treated off-site by 50% compared to the fiscal 2020 level by fiscal 2030.

Breakdown of waste (FY2020 in Japan)
図:Waste oil 54.7%/Waste plastics 12.3%/Wastewater 10.7%/Sludge 6.0%/Metal scrap 9.9%/Waste paper 1.6%/Other 4.8%

We cannot completely eliminate waste emissions as long as the Toyo Ink Group remains a chemical manufacturer and continues to expand its production activities. However, we aim to minimize the amount of waste treated off-site through initiatives such as the development of production processes which are unlikely to generate waste, considering methods for treating waste, promoting the reuse and recycling of resources, and globally sharing knowledge about how to reduce waste.

Zero emissions: The Toyo Ink Group defines zero emissions as a state where the ratio of the final disposal volume of waste at business locations to the volume of waste generated is 1% or lower. In fiscal 2020, the ratio of final disposal volume to the total volume of waste generated in Japan was 0.03%, and we achieved zero emission at all of our business locations.

Amount of waste treated off-site: The amount of waste that was generated at our business locations and discharged from the premises without being recycled or transferred outside our business locations not as a valuable resource but to outsource its disposal to waste disposers.

2-3. Realizing sustainable water use

The Toyo Ink Group uses a large amount of water, including process water (water used for water-based chemical reactions, the washing treatment of products, and similar purposes), cooling water and washing water. Water resources are important natural resources used by the Toyo Ink Group, and we recognize that the more sustainable use of water is an important issue. In fiscal 2020, approx. 73% of the water we took in was freshwater from land, such as groundwater and industrial-use water (water taken from rivers and lakes).  We have been striving to reduce water consumption and purify wastewater by enabling circulation cooling and ensuring the reuse and recycling of used water. Further, moving forward, we will reduce our overall water consumption through measures such as the development of production processes that do not require water and the introduction of new technologies for the use of water. Thus, we will use water under the assumption that it is necessary to protect the environment and preserve biodiversity.

Regarding wastewater purification, we have been striving to manage and reduce the emission of harmful chemical substances because we are a chemical manufacturer.* The amount of chemical emissions was 68.2 t in fiscal 2020. We will take thorough measures to prevent leakage and direct emissions and increase the optimization of the cost efficiency of wastewater treatment equipment, with the goal of reducing harmful chemical substance emissions by 30% from the fiscal 2020 level by fiscal 2030.

Harmful chemical substances: Herein, they refer to Class I designated chemical substances listed under the PRTR Act and substances designated by the Japan Chemical Industry Association.

3. Building a foundation for trust

図:3. Building a foundation for trust/TSV2030/Sourcing raw materials in ways that are friendly to the environment and good for society/Respecting the diversity of employees and co-existing in harmony with the natural environment and local communities/Continually restructuring our governance system/TS2050/Continuing to reform and transform our supply chain, human resources, regional activities, and governance from the perspective of environmental and social contribution 図:3. Building a foundation for trust/TSV2030/Sourcing raw materials in ways that are friendly to the environment and good for society/Respecting the diversity of employees and co-existing in harmony with the natural environment and local communities/Continually restructuring our governance system/TS2050/Continuing to reform and transform our supply chain, human resources, regional activities, and governance from the perspective of environmental and social contribution

The Toyo Ink Group advances its corporate activities to improve the sustainability of people's lives, the global environment, and all forms of life living on the Earth, as an entity supporting all industries and markets. To remain such a corporate group, we continually reform our corporate governance to improve our sustainability as a corporate entity.
In TSV2050/2030 we set the target of continuing to reform and transform our supply chain, human resources, regional activities, and governance from environmental and social perspectives over the long period up to 2050 around the pillar, building a foundation for trust. We have also set the sourcing of raw materials that is friendly to the environment and society, respecting the diversity of employees, co-existing in harmony with the natural environment and local communities and continually restructuring our governance system as interim targets to be achieved by fiscal 2030. We are moving forward with short- and medium-term measures for each of these.

Underlying these targets and measures are the unique qualities of the Toyo Ink Group.  They are: our sense of our responsibility to lead environmental contribution, which we must continue to pursue because we are a chemical manufacturer, our belief that diversity must be respected, our regard of each individual as a valued, irreplaceable person and the assumption that every person is different, which has been instilled in our minds through more than a century of working with diverse people, and the idea of attaching importance to communication passed down by our founder, who began to manufacture printing inks to promote learning and education. These ideas are at the base of the pillar.

図:Unique qualities of the Toyo Ink Group/Sense of our responsibility to “contribute to the environment” because we are a chemical manufacturer/Respect for “diversity”, which we have because we sell many different colored products/The idea of attaching “importance to communication” that was passed down by our founder/Sourcing raw materials in ways that are friendly to the environment and good for society/Improving the CSR procurement rate (setting our own criteria such as the environment and human rights)/Enhancing the global procurement network and human resources (Raw materials information related to the environment/human rights)/Increasing the entrenchment of our procurement policy and standards in the supply chain/Reducing the volume of waste in the overall supply chain, etc./Respecting the diversity of employees and co-existing in harmony with the natural environment and local communities/Improving the employee engagement rate (ES survey, workstyle reform, and others)/Moving forward with activities to communicate with local communities to protect the regional environment and promote diversity (number of projects)/Driving environmental and human rights training (number of projects)/Increasing the percentage of executives, etc. that are women/Continually restructuring our governance system/Operating the Board of Directors in a way that  enables our business portfolio to be continually reviewed/Formulating measures to address climate change and analyzing and disclosing climate change risks (advancing TCFD measures)/Setting numerical targets related to non-financial information, having the targets supervised by the Board of Directors, and disclosing them proactively/R&D: Shifting development resources to themes with environmental and lifestyle value/Equipment investment: Introducing environmental infrastructures as a new category of investment destinations, considering introduction of internal carbon tax, etc.

4. Promotion system

At the Toyo Ink Group, we renamed and reorganized the CSR Generalization Committee into the Sustainability Committee in January 2022 to enhance our Group-wide sustainability activities and established the ESG Promotion Committee under the Sustainability Committee, thus building a structure for the steady advancement of TSV2050/2030.

The Sustainability Committee is supervised by the Board of Directors via the representative directors (Group CEO). Chaired by the operating officer in charge of sustainability, the committee sets, advances, evaluates, and follows up on targets for all activities related to Group-wide CSR and sustainability and reports to the management team via the Group Management Committee, etc.

The missions of the ESG Promotion Committee include driving Group-wide sustainability activities based on TSV2050/2030, practical tasks and promotional activities related to climate change, and providing information both internally and externally, including information disclosure based on the TCFD recommendations. The committee's administrative body is the public relations department and the business administration department of the Group headquarters (Toyo Ink SC Holdings Co., Ltd.).

図:Board of Directors/Supervision/Reporting and proposals/Representative Directors CEO/Supervision/Group Management Committee/Reporting/Sustainability Committee/Chairman: Chief Sustainability Officer/Secretariat: Corporate Communication Dept., Corporate Planning Div./Setting, advancing, evaluating, and following up on (reporting to the management team) plans for all Group-wide CSR-/sustainability-related activities/ESG Promoting Committee/Secretariat: Corporate Communication Dept., Corporate Planning Div./Advancing Group-wide sustainability activities based on TSV2050/2030/Practical tasks and promotional activities related to climate change/Providing information both internally and externally, including information disclosure based on the TCFD recommendations/Compliance Committee/Secretariat: Legal Dept./Promoting compliance with laws related to management and establishing corporate ethics/Planning and advancing compliance activities and providing information internally and externally/Risk Management Committee/Secretariat: General Affairs Dept./Advancing risk management for the entire Group/Preventing occurrence of risks and promoting measures for alleviating damages from risks/Promotion of Group-wide environment and safety management