KONICA MINOLTA

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Medium-term Environmental Strategy

Materiality

Environmental Targets and Results of the Medium-Term Sustainability Plan 2022

Environmental Material Issue Evaluation and Identification Process

Companies today must address a wide range of environmental issues, such as climate change and resource depletion. In light of this, recent changes in society, and the evolving business environment, Konica Minolta has identified material issues related to the environment. The company aims to prioritize these issues and promote initiatives for helping to solve them, while also achieving business goals. Konica Minolta has identified five material issues from the perspective of sustainability and then analyzed the material issues related to the environment — “addressing climate change,” “using limited resources effectively,” “ensuring social safety and security (safety of chemical substances)” — in even more detail so that it could set specific measures.

To identify its material issues, the Group first made a comprehensive list of environmental issues by incorporating international guidelines, as well as various stakeholder requirements. Then, it identified key issues based on their importance to stakeholders and their importance for the business. To determine importance to the business for each issue, the impacts were quantitatively evaluated using five levels. Risk analysis was used to calculate the amount of profit that would be lost if a certain risk materialized, as well as the amount of profit that could be generated if a potential opportunity was seized. In determining the importance of each issue, the Group maintained objectivity by seeking the opinions of outside experts.
The Officer responsible for environment (Group Environmental Officer), who chairs the Group Environmental Promotion Committee, verified this evaluation process and the resulting material environmental issues, before identifying the ones that should be prioritized.

Identifying Material Issues from Both Risks and Opportunities

When evaluating and identifying material issues related to the environment, Konica Minolta identified various environmental factors related to its business in terms of both risks and opportunities. Based on these findings, material issues were selected where solutions can lead to business growth. The company reviews each material issue annually to ensure the issues selected and related plans are appropriate.
Through this process, goals for reinforcing the business are matched with environmental targets. The plan then becomes a commitment for both top management and the entire organization, resulting in effective environmental management.
The Medium-Term Sustainability Plan 2022 identifies the three most important issues as “addressing climate change,” “using limited resources effectively,” and “ensuring social safety and security (safety of chemical substances).”

【Opportunities for Each Material Issue】

* Items in blue are "value creation in the business" and items in green are "value creation in the internal activities."

  Materiality Items (Opportunity)
1 Develop manufacturing processes with low energy, resource and CO2 load
2 Support workstyle reforms for a paperless, ubiquitous society
3 Build a waste-free customer supply chain using on-demand manufacturing
4 Reduce loss in customer work flow and supply chain
5 Improve safety and security measures in preparing for irregular climate patterns and natural disasters
6 Support early testing and drag development for unanticipated illness
7 Contribute to solutions for agricultural and food problems and new chemical substance regulations
8 Leverage ESG factors to strengthen customer engagement
9 Build ecosystems that efficiently resolve environmental problems and create new innovation
10 Leverage DX to dramatically reduce CO2 at suppliers 
11 Cut costs by improving energy efficiency
12 Introduce renewable energy in anticipation of stakeholder demands
13 Cut costs by improving resource efficiency
14 Respond to environmental requests from customers
15 Respond to ESG investment/relations, sustainable finance
16 Create technologies to upcycle unnecessary plastic
17 Earn support from stakeholders for approach to diversity
18 Contribute to water infrastructure, help to counter obsolescence, and support monitoring
19 Create technologies that contribute to use of renewable energy and new energy
20 Create technologies that contribute to ecosystem recovery 

【Risks for Each Material Issue】

* Items in red are "value creation in the business" and items in green are "value creation in the internal activities."

  Materiality Items (Risks)
1 Ban on substances that contaminate ecosystems and damage the health of people (response to stricter regulation on chemical substances)
2 Higher costs for materials, resources, paper and concerns about their supply due to a spike in energy prices, insufficient raw materials and irregular weather
3 Supply chain interruption following large-scale climate disasters
4 Increase in procurement and manufacturing costs due to new emission regulations, carbon taxes, restrictions on the use of fossil fuels and other
5 Response to new regulations on product energy efficiency and markets
6 Demands from stakeholders for renewable energy
7 Decrease in opportunities for paper output in offices (increasing shift to paperless offices due to skyrocketing energy costs/raw material shortages)
8 Decrease in competitiveness due to inadequate response to circular economy (unsustainable use of resources, decline in product competitiveness due to designs using depletable energy)  
9 Material and product supply risks due to regulations on plastic use
10 Response to customers’ environmental demands
11 Drop in social trust due to insufficient governance at business partners
12 Soil contamination
13 Collection and recycling of used products
14 Depletion of resources (precious metals)
15 Delayed response to government procurement standards
16 Delays or stoppages in procurement and production due to depletion of water resources and water risks
17 Costing of virtual water
18 Impact of ecosystem destruction due to manufacturing and use of raw materials
19 Soil contamination
20 Water contamination
21 Legal compliance and management of waste 

Important Environmental Issues for Product Life Cycles

Konica Minolta identifies material environmental issues, including risks and opportunities, throughout its value chains. These are issues that need to be specifically addressed by relevant departments including product planning and development, procurement and production, as well as sales and service. The Group also determines when business risks and opportunities related to important environmental issues are likely to materialize, based on short, medium, and long-term perspectives.

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Impact of Business Risks and Opportunities Related to Important Environmental Issues

As current environmental and social issues become even more serious, risks may materialize and affect Konica Minolta’s business activities. In the long term, manufacturing will face even greater risks, such as substitution of fossil resources and fossil fuels, shortages and supply disruptions of natural resources due to changes in climate patterns, depletion of water resources and water withdrawal restrictions, and limited access to forest resources due to extreme weather and forest fires. These risks are need to be addressed. In the short and medium terms, there are also risks such as stakeholder demands for renewable energy-derived electricity procurement, rising fossil resource and fossil fuel prices, new product energy efficiency regulations and market responses, reduced use of paper in the office, non-sustainable resource use, reduced product competitiveness due to non-renewable design, and supply chain disruptions caused by a major climate disaster. Unless it takes suitable measures now, the Group will likely be faced with higher costs, loss of business opportunities and shutdowns due to damage to facilities and labor environment. Failure to comply with new chemical control regulations, including those that restrict certain chemical content in products, could lead to lost sales opportunities and lower revenues.
On the other hand, Konica Minolta believes it can create business opportunities by providing solutions to help solve these environmental issues. By actively introducing cutting-edge technology and combining it with Konica Minolta's strengths in imaging IoT technology and digital input and output, the Group is transforming itself into a digital company with insight into implicit challenges. The aim is to create solutions that help resolve social and environmental issues, including climate change. With regard to the global environment, the Group is working to address issues such as climate change, resource depletion, and waste by incorporating them into its medium and long-term business strategies. For example, environmental impact can be lowered by reducing production, transportation, inventory, and disposal in the manufacturing industry. Konica Minolta believes that it is contributing to this solution by providing on-demand equipment for industrial printing of materials such as packaging, labels, and textiles. Since excessive paper consumption is an issue in many companies, the Group is promoting a shift to paperless offices by providing digital workplace solutions that improve work flow efficiency. The Group is also working to reduce the enormous amount of energy that companies use to perform big data analysis these days, by offering and promoting onsite data analysis in the form of edge computing. These efforts illustrate how Konica Minolta sees environmental management as a key business strategy. In short, the company believes the purpose of environmental management is both to achieve business expansion and improve environmental issues.

Target Setting Process

The President has ultimate responsibility for and authority over all environmental management including climate change issues and is also accountable for its effectiveness. The President appoints the Officer responsible for environment (Group Environmental Officer) to execute environmental management and handle environmental measures. The Officer responsible for environment Group Executive formulates a medium-term plan for environment, which is then approved by the Board of Directors as a corporate management plan. In addition, the Officer responsible for environment reports monthly to the President, the chairman of the Board of Directors, and the Audit Committee established by the Board of Directors to report progress made on environmental management and on issues including climate change. The Audit Committee summarizes the important issues from those reported as matters to report at the Board of Directors meetings.
Konica Minolta has established a Group Environmental Promotion Committee headed by the General Manager of the Environmental Management Department, which serves as the organization implement the medium-term environmental plan for the whole Group. The committee, in which persons responsible for environmental promotion in each key division participate, deliberates the Group’s medium-term environmental plan and annual plans. It also checks quarterly progress and conducts investigations related to the Group’s environmental issues.

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