CREDIT SAISON

Disclosure in Line with TCFD Recommendations

Worldwide, the severity of climate change and other global environment issues is increasing. Japan is no exception. Weather abnormalities have caused many large natural disasters and have greatly impacted Japan. Companies cannot overlook the impact of climate change. Against this backdrop, we believe that climate change is an important issue we should address in our sustainability-oriented management, and that the risks and opportunities accompanying climate change will greatly impact our business strategies.
The Company expressed its support for the Task Force on Climate-related Financial Disclosures (TCFD) recommendations in 2022 and is involved in the TCFD consortium, a discussion forum for the companies and financial institutes supporting the recommendations.
Based on the TCFD recommendations, we will continue to disclose information about governance, strategies, risk management, metrics and targets regarding our actions to address climate change in pursuit of a sustainable society.

Recommended disclosure items based on TCFD recommendations

Governance

The Sustainability Promotion Committee was established in August 2021 and promotes activities related to climate change.

Being a "leading-edge service company" as stated in our management philosophy, we have a basic aim of helping establish a society that is more convenient, enriched and sustainable than it is now by leveraging our unique expertise, management resources and the experience of our employees and by contributing to the development of society and the resolution of problems in a way that only Credit Saison can through its usual business operations.

Taking action to address sustainability-related issues such as the consideration of climate change and other global environmental issues, respect for human rights, the health and working environment of employees, the fair and appropriate treatment of employees, fair and appropriate trade with suppliers and crisis management to handle natural disasters and other events is very important in our management of our business. These actions help mitigate risks and create revenue opportunities. Based on this understanding, the Sustainability Promotion Committee was established in August 2021 as an organization for discussing the direction of our activities to achieve our sustainability-related strategies and to respond to inquiries from the representative director. The Committee is chaired by the Representative, Executive President and COO.

The Committee pursues the establishment of a sustainable society by taking action to address climate change and promoting diversity, equity and inclusion, including the empowerment of women and other initiatives.

The Committee met seven times in FY2021 and regularly responds to inquiries from the representative director regarding the sustainability strategies and initiatives of the entire Credit Saison Group before reporting them to the Board of Directors as necessary (a report was submitted to the Board of Directors in December 2021 and June 2022).

<Sustainability Promotion Committee organization chart>

organization chart

<Sustainability Promotion Committee Members>

Chairperson Mizuno, Representative,
Executive President and COO
Vice Chairperson Baba, Managing Executive Officer and CFO
Members Mori, Senior Managing Executive Officer
Yasumori, Managing Executive Officer
Shimada, Executive Officer
Otsuki, Outside Director

Criteria for selection of members of the Sustainability Promotion Committee

  • ・The chairperson shall be the Representative, Executive President and COO.
  • ・Members shall be an executive officer in charge of a division such as the Corporate Planning Dept., Corporate Risk Management Dept., Treasury & Accounting Dept., Human Resources Dept., a sales development division or a global division or of an equivalent or higher level.
  • ・The male-female ratio shall be generally fifty-fifty.
  • ・The Committee will also include outside directors to hear opinions from objective and neutral perspectives.
  • ・ Third-party organizations shall also be involved in Committee activities to obtain advice and recommendations in the area of their expertise.

Strategy

We predicted changes in the external environment and analyzed the impact of climate change on our operations in the future, in accordance with the TCFD framework and using a scenario analysis method.

It is important for us to pursue sustainable growth by mitigating climate change and adapting to it through our business activities. Based on this understanding, we believe that actions to address climate change are important in the management of our business. We identify and assess its impact on us by forecasting changes in the external environment and our operating environment accompanying the manifestation of climate-related risks and by identifying risk events. In the scenario analysis, we referenced multiple existing scenarios published by organizations such as the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC).

・Specifying the businesses to be analyzed

  • Scenario analysis is performed on a non-consolidated basis.

・Specifying risk items and opportunity items

  • The TCFD recommendations divide the risks of climate into two categories, transition risks and physical risks. Based on these classifications, we examined risk items to identify the major risk items and opportunity items that are closely related to our businesses.

・Process of assessment and management

  • The Climate Change Strategy WG takes the lead in the examination of risks, assessing their impact and discussing measures. The Sustainability Promotion Committee monitors policies for the handling of risks and the seizing of opportunities and the formulation of strategies and related efforts, and the Board of Directors supervises and receives reports from the Sustainability Promotion Committee as necessary. (The Sustainability Promotion Committee and the Climate Change Strategy WG meet every month)
  • *The Climate Change Strategy WG includes the Corporate Planning Dept., Treasury & Accounting Dept., General Affairs Dept., Corporate Risk Management Dept. and Public Relations Office.

・Definition of timeline (short, medium and long term)

  • A characteristic of climate change is that it usually takes a longer time for its impact to manifest. We take this into consideration along with the target years specified by the Paris Agreement and the Japanese government to define the short-, medium- and long-term timelines as follows.
  • *Short-term (currently - 2024)/medium-term (2030) / long-term (2050)

・Definition of degree of importance (large, medium and small)

  • In assessing the impact of climate change on our financial affairs, we referred to the important matters of the timely disclosure standards of the financial instruments exchange that concern the correction of performance forecasts for the purpose of classifying the matters impacting operating income and ordinary profit. A 10% increase/decrease in the operating income forecast and a 30% increase/decrease in the ordinary profit forecast were classified as having a large impact as the scenario analysis would be performed on a non-consolidated basis.
Classification of impact Ratio to operating income Amount Ratio to ordinary profit Amount
Large 10% or more 25.1 billion yen or more 30% or more 11.4 billion yen or more
Medium 5% or more and
less than 10%
12.6 billion to
25 billion yen
15% or more and
less than 30%
5.7 billion to
11.3 billion yen
Small Less than 5% 12.5 billion yen or less Less than 15% 5.6 billion yen or less

*FY2020
Operating income: 251.3 billion yen
10%: 25.1 billion yen
5%: 12.5 billion yen


Ordinary profit: 38 billion yen
30%: 11.4 billion yen
15%: 5.7 billion yen

Types of risks and opportunities Risks and opportunities Business impacts Indicators of impact on business operations Financial impact Extent of impact Time span
Risks Transition risks Policies and legal restrictions Increased anti-global warming taxes, etc. Impact on SG&A expenses Approx. 0.07 billion yen Low Short term to long term
Market Rising energy prices Impact on SG&A expenses Approx. 0.3 billion yen Low Short term to long term
Physical risks Acute physical risks Damage to buildings due to the intensification of wind and flood damage Impact on head office, sales divisions, data centers, etc. Approx. 0.1 billion yen Low Short term to long term
Chronic physical risks Worsening of the macro economy due to the impact of rising temperatures on agriculture, water resources, health, etc. Impact on doubtful account costs Approx. 4.3 billion yen Low Short term to long term
Frequent occurrence of heatstroke due to a rise in the average temperature and an increase in electric power costs due to the use of air-conditioners Impact on SG&A expenses Approx. 0.03 billion yen Low Short term to long term
Opportunities Energy sources Zero GHG emissions Exemption from a carbon tax through the achievement of zero GHG emissions Impact on SG&A expenses Approx. 0.07 billion yen Low Short term to long term
Market Impact of an increase of sustainability-oriented subscribers on our sales indicators In pursuit of Japan’s 2050 carbon neutrality target and the achievement of decarbonized society through co-creation with enterprises and individuals, we started issuing Saison Card for becoz, a credit card with a carbon neutrality perspective, the first of its kind in Japan.
The CO2 emissions of the cardholder are visualized by category using the cardholder’s card payment data within becoz (which means be CO2 zero), a DATAFLUCT inc. application platform. This motivates the subscriber to change his/her behavior to achieve decarbonization.
The issuance of the credit card encourages sustainability-conscious future generations to connect with the credit card's initiatives for the decarbonization of society, increases the number of  cardholders using our credit card and changes their behaviors. This is expected to increase the reduction of CO2 emissions and to contribute to our revenue long-term through the use of credit cards.
The calculation of the impact on our business operations depends on the outcome of the initiative (customer attributes and trend of credit card use). No profit assessment is performed at this point.
Low Short term
Issuance begins in June 2022

Risk management

The Risk Management Committee and Corporate Risk Management Dept. lead the efforts to mitigate risk and minimize the impact of risks should they occur. To this end, our employees regularly receive in-house training and endeavor to maintain our risk management system in accordance with the Risk Management Regulations, Regulations on Management of Risks of Losses and Crisis Management Regulations. Regarding the issues underlying the Credit Saison Group or governance-related matters accompanied by serious risks, the Group Strategic Management Office, Corporate Planning Dept. leads the supervision of the companies of the Credit Saison Group's execution of business and shares information with the supervisory divisions of the Credit Saison Group companies.

For climate change risks, the Sustainability Promotion Committee leads the formulation of policies and strategies for minimizing risks and seizing opportunities and structurally monitors related efforts.
The Corporate Planning Office of the Corporate Planning Dept., the Public Relations Office and the Corporate Risk Management Dept., which collectively are the administrative body supporting the Sustainability Promotion Committee, lead the regular review of risks and opportunities relating to climate change.

The Climate Change Strategy WG met more than ten times to deepen its discussions in FY2021 while in September the Sustainability Promotion Committee began to meet once a month to advance the discussion of climate change (a report was submitted to the Board of Directors in December 2021 and June 2022).

Metrics and targets

  • 連結グループ各社
Unit: Tons CO2
Result Target
FY2020 FY2030 Compared to FY2020
42% reduction
  Scope1 Direct greenhouse gas emissions from the business operator itself 1,023 593
Scope 2 (market standard) Indirect greenhouse gas emissions from the use of electricity, heat, and steam, which are supplied from other companies 17,540 10,173
Scope 2 (location standard) 17,856 10,356
Scope 1 + Scope 2 (market standard) subtotal  18,563 10,767
Scope 1 + Scope 2 (location standard) subtotal 18,879 10,950
Category 1 Purchased products and services 81,712 61,284 Compared to FY2020
25% reduction
Category 2 Capital goods 323,542 242,657
Category 3 Fuel and energy-related activities that do not fall under Scopes 1 and 2 3,071 2,303
Category 4 Transportation and distribution (upstream) - -
Category 5 Waste generated by operations 132 99
Category 6 Business travel 781 586
Category 7 Employee commute 1,587 1,190
Category 8 Leased assets (upstream) - -
Category 9 Transportation and distribution (downstream) - -
Category 10 Fabrication of sold products - -
Category 11 Use of sold products 47,510 35,633
Category 12 End-of-life treatment of sold products 9,355 7,016
Category 13 Leased assets (downstream) 262,955 197,216
Category 14 Franchises - -
Category 15 Investment - -
Scope3 Indirect greenhouse gas emissions, which does not fall under Scopes 1 and 2 (emission from other companies associated with the activities of the reporting company) 730,645 547,984

*C9,10,14: No relevant activity
*C8: Relevant activities have been included in Scopes 1 and 2
*C4: Relevant activities have been included in other categories
*C15: We will consider calculating it in the future
*The initiatives based on the calculation of Scopes 1, 2 and 3 emissions and the TCFD disclosure framework have gained the cooperation of WasteBox Co., Ltd.

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