The Task Force on Climate-related Financial Disclosures (TCFD) is a task force established by the Financial Stability Board at the request of the G20 to reduce the risk of financial market instability related to climate change.
In June 2017, the TCFD released its final recommendations, recommending that companies understand and disclose risks and opportunities from the perspective of stabilizing financial markets and preventing asset value loss.
The Oji Group announced its endorsement of the TCFD in December 2020 and is working to enhance disclosure based on the recommendations.
For the scenario analysis, the Corporate Sustainability Department organized the identified key risks and opportunities for the Oji Group into transition risks based on the 2°C scenario*1 and physical risks based on the 4°C scenario*1.
The Oji Group recognized that Policy and regulatory risks such as carbon taxes and emissions trading schemes in the transition risk likely be limited because of promoting energy conservation, introducing non-fossil fuels such as biomass and waste, and expanding CO2 absorption and fixation by own forest.
And more, we recognized that Market risk and reputation risk due to using fossil fuels likely be small because of Zero coal-fired power generation by FY2050, and increasing the use of renewable energy by shifting from fossil fuels to non-fossil fuels.
In the physical risks, we are reducing the impact on our business of water damage and extreme dryness due to the intensification of extreme weather, etc., through our ongoing efforts to address business continuity by formulating BCPs*2 and implementing BCM*2, diversifying our raw material procurement, and taking measures to prevent water damage to our manufacturing facilities.
Type | Climate-Related Risks | Potential Financial Impacts | |
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Transition Risks | Policies, laws and regulations | Tighter regulation of GHG emissions |
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Strengthen promotion of the use of renewable energy electricity |
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Increase in fossil energy prices |
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Market | Increased interest in low-carbon products and services among consumers, etc. |
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Reputation | Negative feedback from stakeholders |
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Physical Risks | Acute | Increasing severity of extreme weather events |
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Chronic | Changes in precipitation and weather patterns and rise in average temperature |
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Type | Climate-Related Risks | Strategies and Responses |
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Transition Risks | Tighter regulation of GHG emissions |
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Strengthen promotion of the use of renewable energy electricity | ||
Increase in fossil energy prices | ||
Increased interest in low-carbon products and services among consumers, etc. |
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Negative feedback from stakeholders |
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Physical Risks | Increasing severity of extreme weather events |
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Changes in precipitation and weather patterns and rise in average temperature |
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Type | Climate-Related Opportunities | Details | Strategies |
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Resource Efficiency |
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Energy Source |
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Products and Services |
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Markets | Expansion of the carbon credit trading market |
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Resilience |
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