The effects of climate change are becoming increasingly serious and climate change is considered to be a contributing
factor in the frequent abnormal weather patterns and natural disasters that we see currently. The Nichirei Group’s business
benefits from nature. Therefore, in addition to its importance as a social challenge, we see climate change as a potential
threat to business continuity.
In June 2020, the Nichirei Group expressed its support for the recommendations of the Task Force on Climate-related
Financial Disclosures (TCFD) and announced its participation in the TCFD Consortium. The Group has positioned climate
change initiatives as one of the material matters it identified for achieving its vision for 2030. As such, we are actively
promoting initiatives to help resolve social issues related to climate change.
In addition to appropriately responding to risks posed by shifts in the external environment caused by climate change,
we will consider several scenarios in which climate change could give rise to business opportunities, and conduct
timely disclosure.
In April 2022, the Nichirei Group established the Group Sustainability Committee, which formulates sustainability strategies,
including initiatives related to climate change, and manages the progress of those strategies. Chaired by the representative
director and president of the holding company, the committee comprises the director and executive officer responsible for
implementing climate change strategies, all other officers, including outside directors and outside Audit & Supervisory
Board members, as well as relevant personnel from the strategic planning and sustainability divisions of each operating
company. Climate change-related strategies and targets deliberated and reviewed by the committee are reported to the
Board of Directors of the Nichirei Group by the director and executive officer responsible for climate change initiatives.
Strategies, targets and plans are reviewed as appropriate.
Furthermore, in April 2022, to respond to a wider range of sustainability issues, including climate change, we established
the Sustainability Management Division within the holding company.
The contents of the scenario analysis being conducted from 2019 are also disclosed after deliberation by the Group Sustainability Committee mentioned above.
Worldwide, the Nichirei Group is developing a range of food-centered businesses that it expects will be impacted by climate change in various ways. We are conducting scenario analyses of how climate change might affect our business activities. We hope to better quantify the risks and opportunities identified in order to incorporate appropriate responses in our management strategy. In this way, we aim to become a sustainable corporate group.
We assessed the material risks and opportunities of the Nichirei Group based on two climate change scenarios, and identified general low-carbon policies (CO₂ emission reduction) as the most significant area of Group-wide risks and opportunities. We established long-term CO₂ reduction goals and launched initiatives.
| Business | Risks | |||
|---|---|---|---|---|
| Foods Business | Chicken | Baseline scenario | General abnormal weather |
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| Rice | ||||
| Shrimp | Flooding, rising sea levels |
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| Vegetables, marine products, and meat and poultry products |
|
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| Common | 1.5℃ scenario | Low-carbon policies |
|
|
| Environmental countermeasures within the supply chain |
|
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| Logistics | Baseline scenario | General abnormal weather |
|
|
|
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| 1.5℃ scenario | Low-carbon policies |
|
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| Business | Opportunity | ||
|---|---|---|---|
| Foods Business | Baseline scenario | Changes in weather patterns |
|
| 1.5℃ scenario | Strengthening of environmental countermeasures within our supply chain |
|
|
|
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| Increased environmental awareness |
|
||
| Logistics | Baseline scenario | General abnormal weather |
|
| 1.5℃ scenario | Modal shift |
|
|
| Increased environmental awareness |
|
||
●Items Assessed
Survival rate* and body length (= weight) of adult shrimp in the main production areas (11 locations in total) in the top three countries from which Nichirei Fresh procures shrimp (Indonesia, Vietnam and Thailand).
●Areas Assessed
●Measurement Parameters
●Assessment Outcomes (Climate Change Scenario RCP 8.5)
| Risks | Opportunities | |
|---|---|---|
| Impact of physical changes (Current scenario) |
Survival rate of late stage larvae (juvenile shrimp) decreases by up to 30% compared with 2020 | Shrimp body length increases by up to 30% compared with 2020 |
| Impact in transition scenario | Increase in production and procurement costs due to carbon price transfers | Response to changes in consumer demand from a longterm perspective, procurement of certified sustainable raw materials, and support for producers |
●Production Area Assessment (Climate Scenario RCP 8.5)
| Effect of the increased body length of adult shrimp | |||||
|---|---|---|---|---|---|
| Extra large | Large | Medium | Small | ||
| Impact of decreasing survival rate | Large |
① Indonesia Tarakan ③ Indonesia East Java ④ Indonesia South Sulawesi |
⑪ Thailand Samut Songkhram Province | ⑨ Thailand Chanthaburi Province | |
| Medium | ② Indonesia Lampung | ⑥ Vietnam Can Tho | ⑤ Vietnam Soc Trang ⑩ Thailand Rayong Province |
||
| Small | ⑦ Vietnam Da Nang | ⑧ Vietnam Hue | |||
The effect of increasing body length is higher at the main four production areas in Indonesia than in other areas.
Although the impact of the decreasing survival rate is significant for late larval stage, the impact is considered to be
limited because breeding is at indoor hatcheries with air-conditioning controls and other features.
●Survival Rates by Shrimp Growth Stage
Whiteleg shrimp growth stages and the impact of climate change
●Adult Shrimp Body Length Prediction Map
2090 Whiteleg shrimp body length in RCP 8.5 (4.0°C rise in temperatures)
Prediction (Excerpt)
(Index: FY2021 = 100)
We expect the financial impact on the shrimp business to include higher purchasing costs resulting from higher supplier costs, and various issues arising from market distribution of higher-priced products. Over the medium to long term, we expect that we will be able to effectively deliver social value by maintaining stable distribution of protein-rich shrimp.
Impact with the variety of risks (including climate change-related risks) are considered from comprehensive perspective by the responsible divisions in the rational and optimal methods and the risks are also deliberated and reviewed by the 'Group Risk Management Committee', which is chaired by the representative director and president. The committee has been managing our responses to major risks related to business operations. Due to the need to respond more quickly and accurately to various ESG-related issues, we discuss in the 'Group Sustainability Committee' that deliberates specifically on addressing ESG risks and opportunities, including climate change.
The Group Sustainability Committee works with the strategic planning and sustainability divisions of each operating company to identify important ESG-related issues and risks. The most important themes are then deliberated by the committee. Specifically, the risk associated with climate change is positioned as a major risk for the Group. The committee deliberates and manages business risks and opportunities arising from scenario analyses.
Nichirei Group Material Matters (Materiality)
Realizing sustainable food procurement and a circular economy
| Group Targets (KPIs) |
Procurement ratio of sustainable marine products complying with the Nichirei Group Sustainable Marine Product Procurement Guidelines in marine products business | 99%（FY2025 target） 100％（FY2031 target） |
|---|---|---|
| Ratio of marine products in the above from fisheries with MSC, ASC or other global certification | 32% (FY2025 target) 50% (FY2031 target) |