We recognize that environmental issues are important issues common to all human beings. In order to contribute to a bright future and a livable global environment, we have established an environmental policy since 2008 and have conducted our business activities in consideration of environmental aspects.
In 2021, we completely revised our environmental policy where we will continue to contribute positively to the realization of a sustainable society by having each and every employee involved in more environmental activities and by further promoting cooperation among supply chains.
Environment Management System
Under the direction of the CEO, we have been implementing environmental initiatives for years in mutual collaboration at the Group and regional levels in accordance with the Group's Basic Environmental Policy. In addition, ESG management will be promoted even more than before by setting environment-related targets, monitoring progress, and evaluating what has been achieved in the Group Sustainability Committee, a meeting body under the direct control of the CEO and executive officers.
We recognize climate change, marine plastic, and resource depletion issues as important environmental issues. To resolve these issues, we are mainly committed to the creation of value based on our actions aimed at protecting value, centered on efforts to reduce the environmental burden in manufacturing processes. We believe that a specific action to create value is to develop and supply environmentally friendly products. With this action, the Fuji Seal Group will be able to make the greatest contribution to its customers and consumers and achieve sustainable growth.
Environmentally Friendly Products
Creation of value: Provision of environmentally friendly products
We have provided solutions for customers' issues for many years, with a focus on all business processes, including creation (development), production (manufacturing), and sales (marketing). We realize that we are now further required to identify potential problems and work with our customers and suppliers to resolve them by gaining a better understanding of each customer's business cycle, from planning to manufactur-ing and sales, as well as of their current products. This also applies to the resolution of environment-related issues. The following chart shows the path that we have traced while identifying and addressing various environmental issues, such as weight and volume saving, emission control and reduction, and promotion of recycling, in individual business processes.
We will continue to contribute to society by continuously providing environmentally friendly solutions.
- Promoting material change towards environmentally friendly materials by using recycled and biomass-based materials and paper
- Reducing raw materials by using down-gauged labels and pouches
- Reducing waste containers by standardizing containers with the use of functional labels
- Reducing materials by optimizing packaging forms and reducing CO2 emissions by improving transport efficiency
- Increasing the productivity of label applicators and controlling the generation of waste and CO2 by reducing energy consumption
- Enhancing functionality so that consumers can easily recycle containers and packaging materials
Initiatives for Reducing Environmental Impact
Fuji Seal Group is committed to manufacturing products that reduce the burden on the ecosystem and local environment. Through the production of shrink labels, pressure sensitive labels, pouch containers, packaging-related machinery, and other products, we aim to develop and produce environmentally friendly products, while at the same time reducing the amount of solid and liquid waste, wastewater, and exhaust gas (chemical substances and CO2) discharged, in order to reduce our impact on the environment. In addition, we collect ideas from a wide range of employees through TQM* activities, idea banks, and various projects, and hold regular meetings on energy conservation and environmental protection, as part of a concerted Group effort.
*TQM：Total Quality Management
- Initiatives Related to Climate Change
- Initiatives Related to Water Resource
- Initiatives Related to Waste
- Initiatives Related to Chemical Substances
Governance of Climate-Related Issues
Board of Directors at FSI deliberates on sustainability issues, including climate-related issues, at least four times a year, approving targets and reviewing progress. For example, the current mid-term management plan (announced in May 2018) sets targets such as "waste reduction" and "sales contribution to customers who are involved in environmentally friendly product initiatives" to reduce environmental impact.The executive officers in charge of the regions (Japan, US, Europe, and ASEAN) are responsible for the overall business, including efforts to address environmental issues, based on an assessment of the risks and opportunities of climate change. The executive officers of the business units are responsible for promoting the reduction of the environmental impact of manufacturing processes based on the same perspective. The executive officer in charge of development organizes development meetings four times a year from the perspective of both assessing and managing climate-related risks and opportunities, and is responsible for proactively promoting the development of products that contribute to reducing environmental impact, as well as monitoring these products.In addition to proposing specific policies for action to the Board of Directors, the newly established Group Sustainability Committee notifies and directs each region and business of matters decided by the Board of Directors, and evaluates, supports, and promotes activities in each region.
Strategy and Risk Management on Climate-related Issues
Management Process for Climate-related Risks and Opportunities
Fuji Seal Group uses the following management process to identify business risks and opportunities.
Our proprietary "risk map" method and scenario analysis are used regularly to assess climate-related risks and opportunities.
- Description of Risk Management Process:
- (1) Evaluate the degree of impact and likelihood of occurrence of each possible risk, create a risk map, and visualize their significance.
- (2) Estimate the impact and occurrence of each risk item on management over the short, medium, and long term. Next, identify the most important risk items and prioritize them as part of the risk assessment.
- (3) The completed risk map is reviewed and approved by the Board of Directors at the beginning of each fiscal year, and each division and region develops and implements measures to manage its own risks based on the approved risk map.
- Description of Opportunity Management Process:
- (1)At the end of each fiscal year, a global development meeting attended by R&D members from each region reviews the impact of each opportunity and the feasibility of actions, and identifies key opportunity items based on customer/market needs and technical challenges.
- (2)The identified key opportunities are reviewed by the Board of Directors and approved as global development projects.
- (3)The remaining development proposals are processed as regional development projects by the relevant regional development departments.
In accordance with the Ministry of the Environment's guidelines, a 2-degree Celsius scenario and a 4-degree Celsius scenario are assumed, and related departments, including corporate planning and finance, jointly analyzed the degree of impact on our business.
As a result, we expect that the importance of reducing greenhouse gas (GHG) emissions will increase, and that the plastic waste problem and the shift to label-less packaging, which are deeply related to the packaging industry, will become more apparent. As a countermeasure, we believe it is necessary to take more in-depth measures to reduce the environmental burden, such as reducing the use of organic solvents in printing and using water-based printing, in addition to reducing GHG emissions through the accumulation of energy-saving measures.
Examples of Identified Risks and Opportunities
- Long-term Risk: Increased expenditure due to new carbon taxes
- Fuji Seal Group recognizes that its business could be affected by amendments or repeals of laws related to new regulations or changes in the enforcement policies of regulatory authorities regarding those laws.
If a new carbon tax were to be introduced and $40-100/t-CO2eq were to be levied, this could result in an increase in expenditures of 0.7-1.6 billion yen annually, assuming current emissions levels are maintained, which could have an impact on our business.
- Medium-term Risk: Reputation decline due to insufficient disclosure of non-financial information
- The risk to reputation and reputational damage due to increasing environmental issues, including climate change issues, is one of the identified risks. With increasing interest in ESG investments by institutional investors and shareholders around the world, delays in addressing climate change could lead to a decline in corporate value.
- Short-term Risk: Damage or Inability to Supply Due to Extreme Weather
- In recent years, climate change has led to an increase in abnormal weather events such as typhoons and torrential rains.
In particular, Japan, where torrential rains often cause damage, accounts for about 60% of the Group's total sales. The Group operates six factories in Nabari, Tsukuba, Yuki, Yamagata, Ube, and Hyogo, and has a variety of customers and partner companies. In these areas, there is a risk of damage to buildings, products, and employees due to abnormal weather conditions such as typhoons and heavy rains caused by climate change.
- Opportunity 1: Improving resource efficiency by developing and providing transportation-efficient products that contribute to low GHG emissions
- Fuji Seal Group is working on various aspects to reduce waste and CO2 emissions through more efficient transportation in order to keep costs down and reduce environmental impact. In particular, Fuji Seal Group and its customers have been working on the development of more efficient transportation systems from the perspective of production and delivery. We have identified these developments as one of the opportunities related to climate change.
- Opportunity 2: Meeting the demand for low-carbon products by developing and providing system solutions for packaging materials and machinery
- Fuji Seal Group is developing earth-friendly packaging solutions to reduce environmental impact, such as thin-walled labels, biomass materials, labels and packages made from recycled resins, and packaging machinery optimized for these products with low CO2 emissions. We are also working to improve the production efficiency and energy efficiency of our packaging machinery, and see it as an opportunity to meet the demand for low-carbon products by reducing CO2 emissions in both machinery and packaging.
- Opportunity 3: Development of new markets through recycling-related initiatives to realize a low-carbon society
- Fuji Seal Group is striving to improve quality and productivity, develop new products and cultivate new markets by exchanging information on technologies and markets. In recent years, many of our customers have begun to consider the sustainability of their products as an issue related to climate change. Under such circumstances, Fuji Seal Group considers the development of new markets with recyclable design products and related services as one of the opportunities. In September 2019, American Fuji Seal Inc, a subsidiary of Fuji Seal Group in the U.S., successfully developed a shrink label (RecShrink TM) that can be recycled into PET bottles as an initiative for product recycling.
Company-wide Targets on Climate Change
Fuji Seal Group considers climate change as one of the most important environmental issues and has set medium-term targets for the entire company. We aim to achieve virtually zero GHG emissions in 2050 while reviewing our targets in stages.
Trends in GHG Emissions in Fiscal 2019
GHG emissions in Scope 1 and 2 per unit of sales for fiscal 2019 at the Fuji Seal Group's major production sites in Japan and overseas were 0.85 t-CO2/million yen, a 7% reduction compared to fiscal 2017.
In order to ensure consistency, transparency and accuracy of disclosed GHG emissions and energy consumption, Fuji Seal Group is undergoing third-party verification by SGS Japan, Inc. starting with the fiscal year 2019 report.
- Third-party verification on GHG emissions
- Criteria of Verification:
- ISO14064-3: 2006
- Scope of Verification:
- Scope 1 and 2
(energy related CO2 emissions and energy consumption)
- Fuji Seal Group 24 sites
(all 13 sites in Japan and 11 oversea sites except Fuji Seal Engineering and PAGO Italy)
- Nothing has been noted to believe that Fuji Seal Group’s assertion was not calculated and reported in conformance with the criteria.
Examples of Initiatives
In order to reduce the use of gas and other fuels (Scope 1), we have switched from conventional gas-fired boilers to waste heat boilers that utilize VOCs generated in the printing process, upgraded printing machines more energy-efficiently, and taken measures to prevent energy loss by insulating various boilers. In addition, in order to reduce the use of electricity (Scope 2) and to achieve more efficient temperature control, which is essential for shrink labels, we are changing air conditioning equipment to energy-saving types at our plants in Japan and the Americas, and enhancing the insulation efficiency of buildings and equipment piping at our plants in Japan and Europe. Furthermore, we are working on LED lighting throughout the company.
Fuji Seal Group aims to conserve water resources and strives to develop technologies and supply products that lead to the appropriate management of water during manufacturing and the reduction of water consumption.
Company-wide Targets for Water
Reduction of Water Consumption
Fuji Seal Group strives to provide products that have a small environmental impact and can be used with confidence by consumers by promoting appropriate resource management and recycling of water. Our plants in Japan use recycled water in part of the production process. The washing water used in our plants is filtered and recycled at least 10 tons/day.
Investigation Results on Water Usage
Investigation of water risk at manufacturing sites
Water risk assessment at Fuji Seal Group utilizes the "WRI Aqueduct" provided by World Resources Institute (WRI) to identify areas of high water risk, such as drought, for each site. In 2020, our Indonesia Plant was identified as the highest water risk among production sites in Fuji Seal Group, but our business was not affected by the risk and the plant has been shut down as planned. While high water risk has not been identified since then, we will continue to conduct investigation using the WRI Aqueduct on a regular basis in order to understand the water risk at our manufacturing sites.
Breakdown of water resources at plants in Indonesia
Company-wide Targets for Related to Waste
Examples of Initiatives Related to Waste
We have achieved a 100% recycling rate for waste plastics at our domestic business sites. In addition to plastics, we are also working on the recycling of paper and solvents. We will continue to improve the recycling rate and further reduce the amount of waste, from the design of environmentally friendly products to the proper disposal of waste, in order to realize a resource-circulating society.
Company-wide Targets for Reduction of Chemical Substance Emissions
Efforts to Reduce Emissions of Chemical Substances
Fuji Seal Group is promoting manufacturing by developing production technologies and processes more environmentally friendly. For example, at the Tsukuba Plant, a thermal energy circulation system using VOC furnaces and waste heat boilers has prevented the emission of VOCs into the atmosphere and reduced fuel consumption. In addition, we are planning to gradually introduce appropriate treatment systems at plants that are not equipped with VOC treatment equipment.
Business Operator Classification Evaluation System based on periodical reports under the Energy Saving Act
In the Business Operator Classification Evaluation System of the Ministry of Economy, Trade and Industry, Fuji Seal International, INC. has been certified as class S, the highest rank in the system, as an excellent business operator excelling in energy saving, for four consecutive years from 2016, when the system started.
On December 08, 2020, Fuji Seal International, Inc. was awarded a management-level "B" score for the CDP 2020 Climate Change. For the CDP 2020 Water Security, the score was upgraded from Awareness level to Management level, which was the first time for Fuji Seal Group.
In addition to our efforts against climate change, we will continue to disclose information on our environmental management and to strengthen our efforts in the future.
We have provided environment-related education through orientation training for new employees, division-based training for staff in the production, development, and material procure-ment divisions, and ISO-14001 training at business bases subject to ISO certification. In addition, we began ESG-related training targeting all employees in FY2019 to deepen their understanding of ESG and promote ESG initiatives in each division. We also issue ESG-related booklets approximately twice a year-once each in the first and second half of the year-to promote understanding of the significance and impor-tance of ESG initiatives and the company-wide ESG policy and to introduce concrete activities related to ESG. Briefing sessions on ESG are also held by the head of each division.