The Nichirei Group formulated the Nichirei Group Environmental Policy under the following theme: “If the Nichirei Group is to pass on to future generations the natural abundance that is the source of food and good health and to continue providing freshness and good taste—together with its stakeholders, it must use its superior products and first-class logistics network to reduce the environmental impact of its business activities throughout the entire supply chain and help create a sustainable society.”
The Nichirei Group Environmental Policy focuses on three priority issues: climate change initiatives, promotion of sustainable recycling, and symbiosis with nature. For climate change initiatives, we recognize that food and logistics companies are greatly affected by climate change. We are implementing the following initiatives as part of our low-carbon policies.

We support laws, regulations, and policies related to climate change mitigation and adaptation at our domestic and overseas sites. For example, in Japan we support Act on Promotion of Global Warming Countermeasures and Act on the Rational Use of Energy.

Long-term Environmental Goals and Low-carbon Policies

We will implement low-carbon policies in response to one of the material matters and in pursuit of our long-term environmental goals. We will actively implement the three measures during the 10-year span extending from 2021 through 2030.

• *In June 2021, the Board of Directors revised the CO₂ emissions reduction target upward from 30% to 50%.

●Nichirei Group Scope 3 Emissions by Category

Scope 3 emissions account for approximately 90% of the Nichirei Group’s total GHG emissions, and Category 1 accounts for approximately 89% of total Scope 3 emissions. We have confirmed that the main sources of emissions include procurement of raw materials and OEM products for use in processed foods, marine, meat and poultry products, and third-party logistics (3PL) transportation in the temperature-controlled logistics business.

• *Increase of approximately 61% compared to Scope 3 emissions for FY2022 presented in Integrated Report 2022 . The main reason is that we expanded the scope of emissions included in Category 1.

Utilizing Electricity Generated from Solar Power

The Nichirei Group is installing solar power generation equipment on the premises of food plants and on the rooftops of refrigerated distribution warehouses. As of FY2023, 11 Nichirei Group facilities in Japan had installed solar power equipment, which generated 3,201 MWh of electricity and reduced CO₂ emissions by 1,429 tons in FY2023. We plan to install similar equipment at three more locations in FY2024.
In addition, through our intranet we are also sharing information such as locations that have installed solar panels and daily power generation volume to help increase employee interest in renewable energy and CO₂ emission reduction.

●Solar Power Generation and CO₂ Emission Reduction

Initiatives to Use 100% Renewable Energy Sources at Operating Locations – Carbon-Free Electricity

The Nichirei Group is also working to use 100% renewable energy for electricity at its operating locations. In FY2023, two of the Nichirei Logistics Group’s operating locations that have solar power generation equipment achieved 100% carbon-free electricity, including the purchase of feed-in tariff (FIT) non-fossil fuel energy certificates.^*1 In FY2024, the Group will complement these initiatives in working to use 100% renewable energy electricity. We will install rooftop solar power generation equipment at the Nichirei Group’s main campus in the Hinode area of Funabashi City, Chiba Prefecture. In addition, we will procure renewable energy through methods including Renewable Energy Certificates (RECs) and FIT non-fossil fuel energy certificates.

• *1Certificates that enable trading in the environmental value of non-fossil fuel energy power sources such as renewable energy generated from solar, wind, hydro, geothermal, and biomass. Among these, FIT non-fossil fuel energy certificates represent electricity generated by FIT power sources.

Switching Energy Sources

The Nichirei Group is switching over to energy sources with lower CO₂ emissions. While switching to electricity from renewable energy sources with zero CO₂ emissions, we will also move forward with initiatives to switch to fuels that produce low amounts of CO₂ to generate electricity or heat used for frying and baking on food factory production lines.

Refrigerated and Freezer Electric Trucks

Nichirei Logistics Group began operating electric trucks for refrigerated and frozen cargo in February 2023. Logistics Network Inc. has been using the three vehicles for deliveries in the Tokyo metropolitan area to reduce CO₂ emissions as it builds know-how on the operation of low-temperature electric trucks, which are rare in Japan, to prepare for their full-scale introduction in the future. In July 2023, two more vehicles began operating in the Tokai region. We will continue working to reduce our environmental impact in order to achieve sustainable logistics for supporting our customers’ supply chains.

Purchase of Green Energy^*

Since March 2020, Nichirei Foods has been purchasing RECs and has switched to hydroelectric, biomass, and other sources of renewable energy for the electricity used to manufacture certain household-use frozen foods and for the total amount of electricity used at production facilities.
Kyurei Inc.’s new plant, which opened in spring 2023, takes care of all of its electricity needs with its own solar power generation facilities as well as renewable energy power sources including biomass.
In addition, in FY2021, the Head Office building (Nichirei Higashi Ginza Bldg.) shifted to renewable energy (making use of RECs) for all of its power usage. Furthermore, we employed RECs for all of the electricity used for the Nichirei Ladies professional golf tournament we hosted in June 2023.

●Renewable Energy Initiatives at Nichirei Foods Factories

• *Power generated from renewable energy sources, such as biomass, solar and wind. The CO₂ emission reductions achieved through the use of power generated from renewable energy are traded in the form of RECs.

Eliminating Chlorofluorocarbons (CFCs) -Switching to Natural Refrigerants

The Nichirei Group’s initiatives to counter climate change include systematically eliminating the use of fluorocarbons by switching to natural refrigerants for refrigeration equipment.
By 2030, we will have switched to natural refrigerants for 75% of equipment used by Nichirei Logistics Group (based on tons of equipment excluding leased equipment), including overseas facilities, and 100% of the freezers used by Nichirei Foods at its food factories and investee factories in Japan.

Increasing Energy Efficiency and Preventing Refrigerant Leaks

The Nichirei Group owns large-scale refrigerated distribution warehouses and food factories, and we are implementing a variety of initiatives to increase energy efficiency. In addition, we conduct rigorous inspections and management on a daily basis to prevent fluorocarbon leakage. We also introduced high-performance fluorocarbon detectors in FY2022, and conduct regular inspections to reduce refrigerant leakage.

Preventing Refrigerant Leaks to Boost Operating Efficiency

The Nichirei Logistics Group is stringently checking equipment to reduce refrigerant leaks at all domestic centers.
In FY2014, the Group installed high-sensitivity detectors, which are 10 times more accurate than those previously used, and can detect even minor leaks. By managing the amount of refrigerant used and eliminating leaks, the Group can achieve near-optimum equipment functioning. At the same time, the Group is working to avoid the unnecessary use of electricity. The Group has non-regular staff carry out inspections, since they notice energy-saving points that regular staff may overlook. Energy-saving inspections of the entire center are conducted in parallel with the refrigerant checks as both contribute to CO₂ reduction and the prevention of global warming.
Since September 2018, the Nichirei Logistics Group has been conducting a joint demonstration in collaboration with Hitachi, Ltd. at Funabashi DC, utilizing state-of-the-art IoT technology for the early diagnosis of faults in refrigeration equipment and to improve the efficiency of equipment operations and maintenance. Visualizing energy consumption and analyzing operational improvements will assist the high-efficiency operation of cold storage facilities and will help reduce CO₂ emissions.

Receives Special Review Committee Award

Nichirei Logistics Engineering Inc. (representative director, president: Tsutomu Ito), which handles engineering operations for Nichirei Logistics Group Inc., won the Special Review Committee Award in the 22nd Protect the Ozone Layer, Prevent Global Warming Awards sponsored by the NK Industrial Research Institute, operated by the Nikkan Kogyo Shimbun, Ltd.
The award was received on September 12, 2019, in recognition of efforts to reduce CFC leaks and environmental impacts through the use of systems that predict and diagnose refrigerant leaks.
In addition to further reducing our environmental footprint and responding to customer demands, we plan to better oversee refrigeration equipment maintenance and repair plan proposals, so as to provide overall support that includes recommendations for energy conservation and cost reduction through low-price purchasing.

Initiatives in Production Regions Suppression of Methane Gas Emissions by Cattle (Nichirei Fresh)

Ruminants, such as cattle and sheep, are known for their production of methane gas, which has 21 times the greenhouse effects of CO₂. The gas is produced in their stomachs, released internally when their food is broken down and digested, and then release externally. Since prevention of global warming has become a worldwide issue, Nichirei is undertaking the suppression of methane gas emissions produced by cattle.
The hydrogen generated by the activity of microbes in the rumen (the first stomach) during the digestive process is turned into methane gas by methanogen, and released externally through burps. If cattle are given flaxseed oil fatty acid calcium^*1, the hydrogen in their rumen combines with the unsaturated fatty acids in the oil to form saturated fatty acids. Since research results show that methane gas production can be suppressed, to this end Nichirei has been testing crossbred cattle (male Wagyu and female dairy cattle) on domestic farms since FY2010.
Using Kyoto University’s life-cycle assessment (LCA)^*2 method developed in 2010 to gauge fattening methods, Nichirei has been able to confirm that the environmental impact of these crossbred cattle is 10% less than when conventional fattening methods are used. Further, there is an improved omega balance^*3, while feed costs are lower due to the shorter fattening period resulting from improved growth^*4. Nichirei is now moving toward the sale of beef produced through a nationwide rearing program using flaxseed oil fatty acid calcium. In addition to cross-breeding, Nichirei is also expanding this production method to crossbred Wagyu and Holstein cattle (bulls).

• *1 Flaxseed oil fatty acid calcium: A fusion of calcium with the oil extracted from flax seeds rich in alpha-linolenic acid (omega-3 fatty acid).
• *2 Life cycle assessment (LCA) is the technique of comprehensively analyzing and assessing a product’s environmental impact throughout its entire life cycle, from the raw materials, manufacture and distribution, through to disposal.
• *3Omega balance: The balance between omega-6 and omega-3 fatty acids, which are particularly important essential fatty acids for the human body.
• *4This results from the development of low-cost techniques for cattle production, based on a superior balance of omega-6 and omega-3 fatty acids, and the subsequently reduced environmental impact. Source: Ibaraki Prefecture Hitachiomiya Regional Agricultural Research and Promulgation Conference report, 2011.

Simultaneous Bulk Transport of Frozen and Room Temperature Products​

Nichirei Logistics Group, together with NEXT Logistics Japan, Ltd. (NLJ), started Japan’s first simultaneous bulk transport of frozen and room-temperature products using double-trailer trucks in March 2021. These 25-meter double-trailer trucks feature a room-temperature trailer coupled directly to the tractor, towing a refrigerated trailer. These trucks operate between relay points (XD centers) in the Kanto and Kansai regions.

●Enabling Transport of the Load of Two Conventional Trucks in a Single Trip

By improving transportation and delivery efficiency, double-trailer truck operation can also be used to cope with the problem of Japan’s shortage of drivers, which has become serious. Combining frozen and room-temperature products for transport in a double-trailer truck enables one driver to transport the load carried by two conventional trucks. Moreover, simply coupling and decoupling the second trailer from the tractor enables simultaneous transportation of two different loads, leading to a reduction in cargo handling work and waiting time at each XD center and substantially reducing the burden on drivers.
Going forward, we will confirm the benefits of this type of operation in areas such as labor saving and reduction of environmental impact. We also plan to increase the types of cargo that can be bundled and carried to promote the evolution of the high-efficiency trunk-route transport scheme that NLJ is building into a system that can be used by a wider range of shippers and transport companies.

Promotion of Modal Shift^*1

Since 2003, in a bid to reduce its environmental footprint, the Nichirei Logistics Group has been switching the means of transportation it uses from haulage by road to that by rail and sea. In 2009, the ferry transportation route from Hokkaido to Kyushu was extended, resulting in a 30% reduction^*2 in CO₂ emissions.
In recognition of its achievements in expanding modal shift in frozen food shipping, the Nichirei Logistics Group’s Logistics Network received the Modal Shift Best Operator Award (Grand Prize) at the 14th Award for Excellent Business Entities Working on Modal Shift in 2016, and received the Green Logistics Partnership Meeting Outstanding Business Award^*3 in 2017. Logistics Network is a third-party logistics (3PL) company that improves and manages all logistics operations for its shipper clients, from procurement and stock control to distribution. It has been promoting modal shift for more than 10 years. Rather than just simply using railways and ferries, it implements a variety of advanced solutions, such as having several shippers share a trunk line for transporting goods and making shipments more efficient and standardized by utilizing a demand forecasting system. In 2017, the company received the award along with Nichirei Foods (the owner of the cargo) and its partner companies, Ocean Trans Co., Ltd. and Nippon Express Co., Ltd. Going forward, we will continue to promote sustainable business management that reduces environmental impact and addresses labor shortages.

Notes:

• *1The conversion of road and air transportation by that by rail and sea.
• *2The 30% reduction in CO₂ emissions due to modal shifts in Japan is based on per-route calculations.
• *3An institution administered by the Ministry of Land, Infrastructure, Transport and Tourism and other bodies that awards excellent initiatives that promote CO₂ reduction in the logistics field.

Activities with European Logistics

The Nichirei Logistics Group’s overseas business began with its expansion into the Netherlands in 1988. As of March 2020, Nichirei Holding Holland B.V. has thirteen companies（As of October 2022)—including cold storage facilities and low temperature shipping businesses—and is expanding from its hub in Rotterdam. Logistics in Europe center on shipping by truck, reflecting the advanced state of the local infrastructure. During the past few years, a modal shift has been promoted in the interests of the environment, resulting in a transition from highway truck transportation to maritime and railway transportation, making it possible to ship large volumes of goods. Mostly, when a containership docks at Rotterdam, the containers are offloaded and trucked to a warehouse. With containerships are getting progressively larger, and it is now possible to fit 9,000 forty-foot^* containers on the larger vessels. Shipping these by truck would mean using 9,000 trucks, which would generate large amounts of CO₂.
Holland’s Hiwa Rotterdam Port Cold Stores B.V. uses river barges to reduce its CO₂ emissions when moving containers from the container yard to their warehouses. With up to 25 containers piled on one barge, some 3.5 tons less CO₂ is produced than were 25 trucks used to transfer the containers. Currently there are two barge vessels in the Netherlands that have their own container cranes. Both of them are working for HIWA.
At Transports Godfroy in France, the environmental initiatives of its shipping business include introducing eco-driving training for its drivers in FY2012. Meanwhile, the social contribution activities of its shipping business include the donation to charities—of course with the permission of the consigners—of goods it has had in storage that are past their use-by date.

• *40 feet = 12.192 meters

Greening Initiatives

Nichirei’s CO₂ reduction initiatives include developing CO₂ sinks and reducing emissions. In addition to managing green spaces on its properties, it participates in planting trees and flowers and weeding together with its neighbors.