Toray Group’s Approach to Climate Change

Toray Group, since its founding in 1926, has consistently established “contributing to society” as the cornerstone of its existence, framing this in 1955 as its company motto and remaining committed to its current corporate philosophy of “contributing to society through the creation of new value.”
Based on this corporate philosophy, Toray Group has for many decades focused on creating innovative technologies and advanced materials that provide solutions to various social challenges, including global environmental issues, and has helped to build a more sustainable world.
In May 2019, Toray Industries, Inc. declared its support for the Task Force on Climate-related Financial Disclosures (TCFD) recommendations. In each of the following items, Toray Group discloses critical Group information related to climate change based on these TCFD recommendations.
Toray Group will continue to strive to contribute to the resolution of climate change issues and actively disclose information related to climate change in accordance with TCFD recommendations.

TCFD

Toray Group Efforts to Date

Based on the conviction that companies are public institutions, Toray Group management centers on achieving sustainable growth as a company that contributes to society through its businesses.
One of the corporate commitments presented in Toray Group’s long-term corporate vision, AP-G 2000, introduced in 1991, was to play an active role in protecting the global environment, and in the same year, the Group established the Global Environment Research Laboratory. In the following year (1992), the management of Toray Group affirmed its determination to take active steps to address global environmental issues, one of which was the formation of the company-wide Global Environment Committee.
In 2000, Toray Group formulated its Three-Year Environmental Plan of medium-term environmental protection goals, which included targets for reducing greenhouse gas emissions. The Group has continued to focus on these efforts and is currently focused on its Fifth Medium-Term Environmental Plan (achieve targets by FY2020).
In 2009, Toray Group established its Global Environment Business Strategic Planning Department under the direct control of the president for the purpose of promoting and supporting company-wide plans, development, and business integration of Toray Group global environment business strategies. Since 2011, under the Group’s long-term corporate vision AP-Growth Toray 2020, this department has been central in efforts to expand the Group’s Green Innovation businesses and promote Toray products and services that provide solutions to global environmental challenges and issues related to resources and energy.
Moreover, in the face of the increasing severity of such global environmental challenges as climate change, in July 2018 Toray Group announced the Toray Group Sustainability Vision, which sets out Toray Group initiatives and quantitative targets for fiscal 2030 with a view to realizing the World as Envisioned by Toray Group in 2050. The Group has continued to focus on promoting efforts to achieve this vision.
Toray Group will continue in the coming decades to leverage the strength of its experience with actively striving to contribute to resolving all global environmental challenges, by making every effort to create the innovative technologies and advanced materials that provide essential solutions for climate change and other global environmental issues.

Governance System

Enacted by decision of the Board of Directors in July 2018, the Toray Group Sustainability Vision spells out the Group’s long-term commitment to contributing solutions to climate change and other global issues by delivering innovative technologies and advanced materials.
Moreover, the long-term corporate vision, AP-Growth Toray 2020, formulated in February 2011, and the medium-term management issues tackled by Toray Group every three years since then include the group-wide Green Innovation Business Expansion Project, which contributes to resolving resource and energy issues, and global environmental challenges. In addition, 50% of the Group’s research and technology development investment goes to Green Innovation Businesses (high energy cost efficiency, promotion of clean energy applications, enhancement/deployment of water treatment technology, creation of non-fossil materials, etc.).
Furthermore, three group-wide committees—the CSR Committee, the Risk Management Committee, and the Safety, Health, and Environment Committee—monitor, evaluate, and manage social challenges, including climate change, and the associated risks at Toray Group. Under this structure, the Board of Directors receives reports on committee discussions, overseeing committee practices and making decisions. (See figure below.) In addition to this structure, the Global Environment Business Strategic Planning Department reports on global environmental initiatives and presents proposals for expanding Green Innovation businesses at meetings attended by the Board of Directors twice a year.

CSR Committee Chaired by the Chief CSR Officer (director), this committee discusses CSR-related issues centered on ESG and promotes Toray Group CSR-related activities. (Meeting held once a year)
Risk Management CommitteeChaired by the general manager of the Corporate Strategic Planning Division (representative director and executive vice president), this committee discusses critical risks that may affect Toray Group operations, including climate change, and promotes Toray Group risk management. (Meeting held once a year)
Safety, Health, and Environment CommitteeChaired by the general manager of the Manufacturing Division (senior vice president), this committee discusses Toray Group policies and measures related to safety, health, accident prevention, and the environment and promotes Toray Group safety, health, accident prevention, and environmental activities, including the reduction of greenhouse gas emissions. (Meeting held once a year)
Toray Group Governance Structure

Toray Group Business Activities That Help to Address Climate Change

1. Toray Group Sustainability Vision

In the aforementioned Toray Group Sustainability Vision, Toray Group describes four aspects of the world it envisions for 2050, including a “net zero emissions world, where greenhouse gas emissions are completely offset by absorption,” and also sets out issues to be addressed to achieve this and quantitative targets for fiscal 2030 (base year: FY2013).

In line with the Japanese government’s goal of reducing greenhouse gas emissions by 26% from the 2013 level by 2030 (7% reduction for industry sector), Toray Group has set a quantitative target of reducing its greenhouse gas emissions relative to sales in production activities by 30% across the entire Group.
In addition, Toray Group believes that it is necessary to ascertain the CO2 balance for the entire life cycle of products and services in order to help solve climate change issues through its businesses. Toray Group was an early adopter of contributing by reducing not only greenhouse gas emissions within the Group, but greenhouse gas emissions throughout the entire value chain. In its quantitative targets for fiscal 2030, the Group has raised its target by a multiple of eight for CO2 emissions avoided in the value chain by supplying Green Innovation products.
With these quantitative targets in mind, Toray Group is currently developing its next long-term corporate vision, which will cover the period up to 2030. Once this vision has been formulated, the Group will focus on its steady implementation.

2. Green Innovation Businesses

Toray Group’s Green Innovation businesses contribute to solving global environmental challenges and resource and energy-related issues. With the aim of realizing a sustainable, low-carbon society by supplying Green Innovation products that make the most of Toray Group’s advanced materials and core technologies, the Group will continue to promote its Green Innovation Business Expansion Project. In light of today’s rapidly worsening environmental problems, Green Innovation businesses, which help resolve these problems, is one of the key areas that will support Toray Group’s sustainable growth. Expanding Green Innovation business is one of the most important initiatives to realize the world Toray Group envisions for 2050, as described in the Toray Group Sustainability Vision.
As mentioned above, Toray Group has been focused on its Green Innovation Business Expansion Project since 2011, and sales of Green Innovation products increased from 378 billion yen in fiscal 2010 to 786.9 billion yen in fiscal 2018.
For more information on the Group’s Green Innovation business activities, see the relevant section of the Toray website at the link below.

The following list offers specific examples of ways in which Toray Group’s Green Innovation businesses relate to countering climate change.

Carbon Fiber Composite Materials
Toray Group began supplying carbon fiber as primary structural materials for aircraft in 1992, signing a contract for the comprehensive supply of carbon fiber composite materials (Carbon Fiber Torayca® Prepeg) with The Boeing Company in the U.S. in 2005 and a long-term comprehensive supply contract with Boeing in 2015, extending the contract term by more than 10 years. The total supply of Toray Group carbon fiber composite materials during the contract period (2015 – 2025) is expected to exceed 1.3 trillion yen.
The improved fuel efficiency in aircraft that use carbon fiber reinforced plastic (CFRP) for 50% of the weight of the aircraft structure yields an estimated total CO2 reduction of 27,000 tons per aircraft over ten years compared to conventional aircraft (which use CFRP for 3% of the weight of the aircraft structure). (Reduction calculated by the Japan Carbon Fiber Manufacturers Association.)
Battery Separator Film
In addition to expanding consumer application of portable electronic devices, stationary secondary batteries, and other uses, in-vehicle applications of the separator film (BSF) used in lithium-ion batteries (LiB) are also expected to surge as electric vehicles (EV) become more commonplace.
With growing awareness of environmental issues, EV and other environmentally friendly vehicles are expected to become more common in Europe particularly quickly. In response, Toray Group has decided to build new BSF production facilities in Hungary as its third production base, joining Japan and South Korea. These facilities are expected to begin operations in July 2021.
Waterless Offset Printing System for Flexible Packaging
In a joint project with ink and printing machinery manufacturers and printing companies, Toray Group has jointly developed a waterless offset printing system for flexible packaging, which eliminates volatile organic compounds (VOC) and makes it possible to significantly reduce CO2 emissions in the printing process.
The waterless offset printing system reduces VOC emissions to less than 1/50 of the VOC emitted in gravure printing, which is widely used for printing on flexible packaging in Asia and other areas. Using an ink drying method based on power-saving LED-UV technology eliminates the need for the solvent drying and exhaust treatment required for gravure printing, reducing power consumption to less than 1/6, which makes it possible to significantly reduce CO2 emissions associated with power consumption. By promoting and utilizing the waterless offset printing system for flexible packaging, Toray Group aims to reduce CO2 emitted in Japan by approximately 500,000 tons a year around 2030 (figures estimated by Toray Industries, Inc.).

3. Initiatives Designed to Reduce CO2 Emissions at the Manufacturing Stage

In order to reduce CO2 emissions at the manufacturing stage, Toray Group is promoting such initiatives as the promotion of energy conservation, utilizing renewable energy, and reducing the use of coal.
For information on results related to the reduction of CO2 emissions at the manufacturing stage in fiscal 2018, see the relevant section of the Toray website at the link below.

4. Initiatives to Reduce CO2 Emissions in Distributions

In order to reduce CO2 emissions in distribution, Toray Group is pursuing such initiatives as shortening transport distances, shifting to shipping and rail transport that have less impact on the environment (modal shift), and improving transportation efficiency.
For information on results related to the reduction of CO2 emissions in distribution in fiscal 2018, see the relevant section of the Toray website at the link below.

5. Next Steps

Toray Group will continue to work to reduce greenhouse gas emissions in the Group’s production activities and will strive to supply even more products and services that contribute to the mitigation of and adaptation to climate change by creating innovative technology and advanced materials as part of it Green Innovation Business Expansion Project.
Meanwhile, Toray Group has identified the following risks posed by climate change to its own businesses: (1) the impact of weather-related disasters caused by climate change (flood, drought, etc.) on operations; and (2) increased operating and equipment costs due to carbon pricing (carbon taxes, etc.) and the expansion of various regulations.
Moving forward, Toray Group will further analyze the scenario of a temperature rise of well below 2 degrees Celsius above pre-industrial levels and study the effect of the risks and opportunities posed by climate change on Group business and strategy.

Risk Management

With regard to Group-wide risks, including risks associated with climate change, Toray Group conducts regular risk management (priority risk mitigation activities) and ongoing risk management (monitoring domestic and foreign trends and detecting, evaluating, and monitoring risk).
For information on Toray Group-wide risk management activities, see the relevant section of the Toray website at the link below.

Related Information

Indicators and Objectives

As mentioned above, the Toray Group Sustainability Vision sets out the Group’s quantitative targets for fiscal 2030 as shown below. The chart below shows the results achieved with regard to the Group’s quantitative targets for fiscal 2018.

  Achieved FY2013 Achieved FY2018 Target FY2030
(Compared to FY2013)
  Compared to FY2013
Green Innovation product sales 463.1 billion yen 786.9 billion yen approx. 1.7 times 4 times
Contribution to CO2 reduction
in value chain
38.45 million tons 162.0 million tons approx. 4.2 times 8 times
Life Innovation product sales 119.6 billion yen 223.0 billion yen approx. 1.9 times 6 times
Contribution to water treatment
(conversion to water volume)
27.23 million tons 46.8 million tons approx. 1.7 times 3 times
Greenhouse gas emission per
unit of sales
0.0337 thousand tons
/billion yen
0.0286 thousand tons
/billion yen
approx. 15 %
reduction
30 %
reduction
Water usage per unit of sales 1.52 thousand tons
/billion yen
1.17 thousand tons
/billion yen
approx. 23 %
reduction
30 %
reduction