The Nichirei Group established a Group Environmental Policy focused on three priority issues: prevention of global warming, promoting sustainable recycling and living in harmony with nature.
Nichirei Group activities span the entire supply chain; it is involved in food factories, logistics centers and other worksites. We thus play a part in the environmental impact resulting from the activities of our customers and business partners.
At the same time, since Group business activities that support food-related infrastructure depend on natural ecosystems for raw materials, our business is greatly affected by climate change. With its business interests in mind, the Group is engaged in the following activities together with its business partners.

• Efficient energy use in the production of food products
• Reduction of greenhouse gases through increased efficiency in temperature-controlled storage and transportation
• Reduced impact of business activities on climate change through promoting the use of renewable energy, from procurement and production, through to storage, logistics and sales

The Nichirei Group, comprising a wide variety of different businesses, promotes the design of environmental policies adapted to the business characteristics of each member company, as well as highly effective environmental activities. The initiatives of each company are reported by the Group Environmental Protection Committee, which meets three times a year. The Committee determines the environmental protection strategies and policies of the entire Group based on the content and progress of company initiatives, and shares social trends on the environment. The Representative Director and President serves as the chairperson of the Group Environmental Protection Committee, with executives and presidents of operating companies making up the rest of the Committee membership.

^* Fiscal years (FY) indicate years ended March 31.

Engaged in collecting data regarding the environment at overseas worksites

The reduction of CO₂ emissions refers to the target reduction of all emissions, and covers all energy consumed at worksites and by company-owned vehicles in Japan. The waste recycling rate continues to be maintained at 99% or higher. Food plants in Japan are also working to reduce residual animal and plant material. As for the conservation of water resources, as a food-related corporate group, Nichirei has formulated behavioral targets for using water efficiently and is promoting efforts toward achieving those targets so that the bounties of nature can be preserved for future generations. The entire Group is also engaged in collecting environmental data at its overseas worksites.

In addition to the Group working to reduce CO₂ emissions at its places of business, such as factories and logistics centers, all operating companies have identified the major issues they are facing and are working toward reducing their CO₂ emissions. The total amount of CO₂ emissions for FY2019 increased by 1.1%^※1 compared to FY2010 due to increased production, new office construction, and so on. In addition, when using the coefficient of variation to compare the CO₂ emission factors due to electricity production, there was an increase of 12.1%^※2. Going forward, in addition to making its food factory and logistics center operations more efficient, updating to energy-saving equipment, and implementing renewable energy, the Group will work on reducing CO₂ emissions throughout its entire supply chain.

Notes:

• 1.Fixed power emission coefficient: The CO₂ emission intensity unit of 0.412 [t-CO₂/MWh] announced by the Federation of Electric Power Companies of Japan in FY2010, used nationwide.
• 2.Variable power emission coefficient: Power conversion coefficient used by power companies in fiscal year utilized at each worksite.
• 3.Scope of power emission intensity: Nichirei Foods (Nichirei Foods-operated factories and affiliated factories in Japan) and Nichirei Fresh (affiliated factories in Japan). Excluding the following factories: Nichirei Foods: Nichirei Ice Inc., Nichirei Fresh: Nichirei Fresh Farm Inc., Fresh Chicken Karumai Inc., Fresh Meat Sakudaira Inc.

The amount of waste discharged outside worksites in FY2019 was 45,400 tons, and the waste recycling rate was 99.5%. Regarding residual animal and plant material at factories, targets have been set for each operating company with a food factory, and efforts are being made to reduce waste discharge. Although recyclers can sometimes not be found for waste destined for final disposal because of the type and volume of waste, the Group will work on further reductions, including by controlling the amount of waste produced.

The Nichirei Group grasps and manages its consumption of water and quality of its wastewater through regular monitoring in compliance with various food safety and environmental protection laws and regulations. At worksites in Japan, positive steps are being taken to conserve water. Going forward, the Group will examine the availability of necessary water resources at each regional base and how to assess the impact of risks.

The Nichirei Group prioritizes ISO 14001 certification at its food factories. At Nichirei Foods, certification has been obtained at 11 directly-operated and subsidiary factories. Within the Nichirei Logistics Group, Green Management Certification has been obtained at Kyokurei Corporation and NK Trans Inc. On a basis of production, the Group has obtained ISO 14001 certification at 76% of its food factories in Japan.

In addition to covering areas such as organizational management and business processing, the Nichirei Management Auditing Department also does Group management audits of important areas, such as compliance with environment-related law and conservation activities. Worksites that have obtained ISO 14001 certification undergo internal environmental audits as well as yearly external reviews by a registered external review body.

■In-house Environmental Education

Name	Content
Environmental e-learning	Held since FY2010 for all employees. Focuses on such pressing issues as prevention of global warming, resource recycling, and biodiversity.
Campaign to save energy in employee households	Energy-saving campaigns for employee households have been held since FY2012, to improve employees' awareness of the environment. The aim is to have participants share energy-saving tips, and have energy consumption reduction targets.
Training for new employees	They are taught about the company's environmental policies and goals, and the connections between business and the environment.
Hands-on training on company land in Urabanda	Hands-on training for employees was held on company-owned land in the Urabandai region of Fukushima Prefecture between FY2014 and FY2017. There they help eliminate the Signal crayfish, a specified foreign organism, as well as go on hikes in forests surrounding company land.
Hands-on training to support the Cypripedium macranthos an endangered orchid, in the town of Fujimi, Nagano Prefecture	Nichirei has helped restore the endangered Cypripedium hotei atsumorianum—Fujimi, Nagano Prefecture's Cypripedium Restoration Conference—since they were established. The town of Fujimi conducted a hands-on environment-related training program for Nichirei employees that included activities for the protection of the Cypripedium macranthos. Participating in activities to protect the allows one to experience the difficulty of restoring the balance of nature once it has been destroyed.
Hands-on training (Biodiverse forests)	As part of the Good for lunches! Good for the forest! Program which protects biodiverse forests, Nichirei Foods hold a hands-on nature training program for employees in forests it supports. Nichirei Foods: Good for lunches! Good for the forest! Program

To gain a quantitative picture of the costs and environmental benefits of its environmental protection activities, the Nichirei Group has implemented environmental accounting since FY2001.

Main Investments for FY2019

(Food factories)
●Maintenance, management and load reduction of wastewater treatment facilities
●Renewal of natural refrigerant refrigerators, etc.
●Making high efficiency of firing machine

(Logistics centers)
●Expenses related to the appropriate management of Freon
●Maintenance, management and load reduction of wastewater treatment facilities
●Installation of energy-efficient lighting
●Equipment introduction costs for efficient operation of refrigeration equipment

Scope of calculation
Main food factories and logistics centers in Japan
Method of calculation
(1) Based on the List of Fixed Assets in the accounting system, depreciation and amortization is calculated for equipment related to environmental burden, such as wastewater treatment facilities, using the statutory useful life.
(2) Personnel expenses are calculated by determining the man-hours required for each environmental conservation activity, and multiplying this by the number of workers and the average wage rate at the worksite.

Scope of calculation
Eight Nichirei Foods-operated factories in Japan that have obtained ISO 14001 certification

Method of calculation
(1) Only substantial effects that can be calculated based on measurements, etc. have been included in the total (gains on sales arising from recycling promotion activities, reductions in costs arising from reduced power consumption, etc.)
(2) Equivalent to the profit contribution produced in FY2019, attributable to new environmental conservation activities that were conducted in FY2018 and FY2019 (including activities started midway through the fiscal year).

In FY2019, there were no legal violations or environment-related incidents, fines and penalties that had a serious impact on the environment.

Most of the energy consumed by Nichirei Biosciences Inc. is used by its development center. For that reason, the company set up an Ecology Committee to make decisions related to environmental conservation. The committee's work entails creating a wide range of proposals for saving energy, providing feedback on matters subject to company-wide decisions, and serving as a link between employees and the company.
These tasks are facilitated by a regularly issued bulletin, the Eco-tan News, and all employees are involved in resources management.
In FY2018, the committee verified the effects of air conditioner grills designed to increase the efficiency of heating and cooling. The grills had been introduced in FY2017 for the purpose of reducing the energy consumed by air conditioners. Furthermore, in a project to relocate certain production bases from January 2019, the committee moved to make the new research and production base environmentally friendly. In addition to introducing systems to visualize solar power generation and power consumption, advanced environmental equipment will also be installed. Besides energy-saving effects, consideration is also being given to workplace comfort, with proposals being put forward for external awnings and an advanced lighting system.