Policy and Basic Approach
Amidst efforts to achieve SDGs and overcome other social challenges, companies are facing increasing expectations and demands for proactive actions and they are expected to play ever more important roles. Under these circumstances, we recognize that the chemical industry is responsible for the foundation of society and innovation, and that it bears a great responsibility to solve social issues. In order to realize a sustainable society, it is essential for companies themselves to grow while continuously creating social value, by providing diverse solutions. To this end, it is now even more important that companies accurately identify opportunities and risks from an ESG perspective and reflect them into management.
The Mitsui Chemicals Group has been promoting a variety of initiatives since it launched its triple bottom line management of economy, environment, and society in 2006. In April 2018, we established the Corporate Sustainability Division, expressing our intention to refine the triple bottom line management approach and commit to corporate management with ESG elements at its core. In 2022, we launched VISION 2030 to further incorporate ESG elements into management and strategies, proceed to the execution phase, and strengthen our efforts to disclose ESG information to stakeholders.
Incorporating ESG elements into management and strategy and the implementation thereof
- Reflect ESG considerations in management and policy, strategy and planning discussions at the Board of Directors, Company-wide Strategy Committee, and Corporate Sustainability Committee meetings
- Generate business involving business and R&D divisions and promote innovation
Improvement of ESG information disclosure
- Boost appeal to institutional investors, customers, and sustainability rating agencies
- Strengthen ESG dialogue
System and Responsible Officers
The person in charge is the responsible officer for the Corporate Sustainability Committee.
With ESG concerns as a central feature of the Group’s sustainability management, steps are being taking to discuss the Group’s overall direction at various organizations including the Board of Directors and Corporate Sustainability Committee. In addition, the progress of VISION 2030 non-financial metrics and reviewing material topics are also undertaken within this system.
Corporate Sustainability Committee
The roles of the committee are presented as follows.
- Deliberate on the Group’s policies, strategies, plans, and measures as they relate to the promotion of ESG
- Report and discussion of ESG promotion status in the Group
- Discussion of other important matters related to ESG promotion
In principle, the Corporate Sustainability Committee meets four times each year. If circumstances require us to plan new important matters related to promoting sustainability strategies and propose measures accordingly, the committee chair will establish a subcommittee to address such matters. Until FY2021, the committee has been working on addressing climate change and creating plastics strategies by establishing a dedicated subcommittee. However, the scope of activities in the subcommittee has expanded, including carbon neutrality responses, and the need for further deepening and acceleration of the subcommittee's activities has increased. In response, in FY2022, the committee restructured and upgraded the subcommittee into the Circular Economy Center of Excellence (CoE) to further strengthen the initiatives.
Details of the committee’s deliberations and activity results are reported to the Management Committee. In addition, the committee submit particularly important agenda items to the Management Committee and Board of Directors for approval.
*Corporate auditors also attend committee meetings and are able to offer their opinions whenever necessary.
*The chairperson is able to call on executive officers and general managers at Mitsui Chemicals who have an interest in the matters being deliberated to attend the meetings and ask for their explanation and opinion.
Incorporating ESG elements into the management system
The Mitsui Chemicals Group aims to build a management system that integrates financial and non-financial aspects by incorporating ESG elements into its management practice and strategies.
Incorporating ESG elements in investment and financing decisions
Internal carbon pricing.
IRR calculated by the following formula: Incremental profit ± GHG increase or decrease × ICP price
Incorporating ESG elements in annual budgets
Mitsui Chemicals incorporates ESG elements into its basic company-wide budgeting policy.
In FY2020, in our efforts to accelerate the production of Blue Value™ and Rose Value™ products and services, we adopted the sales revenue of Blue Value™ and Rose Value™ products and services as performance indicators in line with the goal under VISION 2030 (40% of sales revenue by product and service). Each business division plans its annual budget based on the challenges and measures for the targets and tracks their progress.
As for climate change measures, all division include their short-, medium-, and long-term challenges, goals, and measures in the annual budget, and also add measures for circular economy starting in 2022.
In addition, we have set KPIs and targets that are linked to our material topics as non-financial metrics for VISION 2030. We aim to enhance our corporate value by effectively monitoring the financial and non-financial aspects of our management practice. For KPI, we have designated an officer or a general manager who is responsible for monitoring the progress, and each division manages these KPIs by incorporating them into their annual budgets and targets. In addition, the Corporate Sustainability Committee and the Company-wide Strategy Committee will review progress and related issues from the perspective of how progress toward KPIs each fiscal year will contribute to the achievement of non-financial targets for 2030 (consistency and appropriateness of KPI/target setting) and how efforts to achieve non-financial targets will contribute to the achievement of financial targets (relationship between financial and non-financial targets).
In order to integrate ESG factors into management and strategy, the Mitsui Chemicals Group believes that it is essential for each and every employee to understand ESG and to incorporate it into their work.
To that end, we have been holding ESG Link Café one-point lessons since fiscal 2020, which are dialogue-based online lessons for all employees to freely participate in, with the concept of “anyone can join as they please.” These lessons deal with and provide quick and simple introductions of a wide variety of ESG-related topics with high social interest, in addition to the Group’s ESG-related initiatives. With time set aside for free discussion after the lesson, the events are also utilized as a place for ESG-themed internal communication.
In addition to these lessons, we also work to instill understanding in the Company in a variety of ways, including a series of posts on the internal site explaining ESG-related terminology and workshops for workplaces and departments. Through a multi-layered approach, we will continue to support each and every employee in incorporating ESG-related initiatives into their own work, thereby facilitating the practice.