Posted 'Disclosure based on Recommendation of the TCFD'

When our founder Fusajiro Kanematsu established the Company in 1889, he personally laid down the following corporate principle: "Let us sow and nurture the seeds of global prosperity." These words represent Fusajiro's intention to sow the seeds (i.e., create businesses) to achieve prosperity of Japan and happiness through economic development. In a modern context, this corporate philosophy expresses our commitment to help achieve prosperity and happiness for people not only in Japan but all over of the world, which is similar to the ideas underlying the Sustainable Development Goals (SDGs).

In relation to SDG 13, Climate Action, we have selected and focused on particular businesses and promoted initiatives since our inception to create a business portfolio that does not include thermal power generation, coal, and other carbon-intensive businesses. In addition, all projects--investments, important contracts, significant asset purchases--are implemented in line with the Group's sustainability policy and key issues (materiality). We have thus developed a governance system for management and monitoring to ensure that our Group does not engage in carbon-intensive businesses.

Thanks to these extensive efforts to control our environmental impact, CO₂ emissions (Scope 1, 2) from Group operations are extremely small relative to our size. We will maintain the current governance system to ensure that our emissions do no increase going forward. Furthermore, our Group has actively engaged in a forest conservation project and Joint Crediting Mechanism (JCM) project in recent years. Through these projects, we plan to offset all our CO₂ emissions with credits generated by our Group or avoided emissions to be converted into credits (become carbon neutral*1) as soon as possible and eventually aim to become carbon negative*2 so that we can keep on contributing to Japan and the international community.