Addressing climate change issues

We recognize that climate change is a global challenge and that minimizing its impact through our business activities is of critical importance. We position efforts toward a carbon-free society as a corporate responsibility and actively work to address climate change through measures such as reducing GHG emissions and energy consumption. Guided by the TCFD recommendations, we have established the following framework for governance, strategy, risk management, and metrics and targets.

We position the management of climate-related risks as a key management issue. The Board of Directors receives reports on climate change from the Sustainability Committee, chaired by the President and CEO, and oversees progress on initiatives aimed at achieving emission reduction targets.

Osaka Soda uses the 1.5°C‒2°C and 4°C scenarios to identify risks associated with the transition to a carbon-free society (transition risks) and risks associated with the physical impact of global warming (physical risks), respectively. When identifying climate-related risks and opportunities, we classify the timing of risk emergence as short term (less than one year), medium term (one year or more but less than three years), and long term (three years or more), and assess their impact on our business.

Under the 1.5°C‒2°C scenario, transition risks are assumed to be relatively higher than physical risks, whereas under the 4°C scenario, physical risks, such as operational disruptions and unstable resource supply resulting from more frequent typhoons, floods, and other natural disasters, are assumed to be relatively higher. We have identified the transition and physical risks and opportunities related to climate change that are material to the Company and have formulated response policies accordingly.

The Company identifies and evaluates sustainability-related risks and opportunities through discussions among relevant divisions, extracting Company-wide risks and opportunities, and determining which are material. For climate-related risks and opportunities, the departments responsible first discuss them, after which the Sustainability Committee identifies and evaluates Company-wide risks. For the identified material risks and opportunities, the Sustainability Committee discusses and formulates response policies, strategies, and initiatives, and conducts reviews. The matters discussed are then reported regularly to the Board of Directors, which resolves on them.

The Company uses GHG emissions as a metric for evaluating its climate change response and has set a target of reducing total Scope 1 and 2 GHG emissions by 30% by fiscal year 2030, compared with fiscal year 2013. To achieve this target, we are actively pursuing efforts to reduce energy use and improve energy efficiency, including streamlining production processes, introducing high-efficiency equipment, and reusing energy through thermal recovery.

Additionally, by pursuing fuel conversion, adopting non-fossil power, using Carbon dioxide Capture, Utilization and Storage (CCUS) technologies, and utilizing biomass and recycled fuels, we aim to curb emissions and achieve carbon neutrality by fiscal year 2050. We are also focusing on developing and providing products that help reduce GHG emissions, contributing to the realization of a carbon-neutral society.

Due to increased production activities, GHG emissions in fiscal year 2024 totaled 975 thousand t-CO2e (with Scope 1 and 2 combined amounting to 497 thousand t-CO2e).

At the silica gel production facility at the Matsuyama Plant, which was completed in September 2024, we are working to reduce our environmental impact by utilizing renewable energy and ensuring that the electricity used in production is carbon-free.