ESG Communication Book 2022
Story Book

1

For the generationthat will lead the future
A new era of prosperity

2

Values of the Sumitomo Corporation Group

Toward the Realization of a Sustainable Society—The Sumitomo Corporation Group’s Challenge

Resolving global social issues through the creation of new value.
Therein lies the mission and responsibility of the Sumitomo Corporation Group.
Sumitomo’s Business Philosophy

Sumitomo Corporation Group’s
Corporate Mission Statement

Sumitomo Corporation Group’s
Material Issues

The Sumitomo Corporation Group has a history
spanning more than 100 years, and thecornerstone of our Group’s values has been
Sumitomo’s Business Philosophy. We haveinherited philosophies that still hold true today,
such as “place prime importance on integrity
and sound management without pursuing easy
gains” and “benefit for self and others, private
and public interests are one and the same.”

Our Group’s Management Principles state our
Corporate Mission as “to achieve prosperity
and realize dreams through sound businessactivities.” Based on the values presented here,
we aim to be a global organization that
constantly stays a step ahead in dealing withchange, creates new value, and contributes
broadly to society.

In April 2017, the Sumitomo Corporation
Group identified “Six Material Issues to Achieve
Sustainable Growth with Society” in the future.
We have positioned these material issues asimportant elements in developing businessstrategies and in the decision-making process
for individual businesses.

WEB

Please refer to our corporate website for more
information on Sumitomo’s
Business Philosophy.

WEB

Please refer to our corporate website for more
information on the Sumitomo Corporation Group’s
Corporate Mission Statement.

WEB

Please refer to our corporate website for more
information on the Sumitomo Corporation
Group’s Material Issues.

3

Top Message

Top Message

To Realize a Sustainable Society andEnhance Corporate Value throughContribution to Resolving Social Issues
As the Sumitomo Corporation Group’s Corporate Message of“Enriching
lives and the world” states, we aim to further enrich the world, society,and people’s lives. We are practicing new value creation based on
Sumitomo’s Business Philosophy of “Benefit for self and others, private
and public interests are one and the same*,” which has been passed
down over many years. The structure of our ESG Communication Book
has changed from this fiscal year, and in ESG Communication Book
(Story Book) we have shown as a single story the mechanism of ourvalue creation through creation and enhancement of businesses. We
hope this book will help to deepen your understanding our efforts.
This is the second year of the medium-term management plan
“SHIFT 2023,” announced in 2021. In SHIFT 2023, aiming for a portfolio
shift from a medium- to long-term perspective, we will undertake efforts
such as the reinforcement of businesses that apply our strengths and thedevelopment of businesses that contribute toward the realization ofsustainable society. We believe that continuing to create value needed bysociety will lead to the Group’s sustainable growth. Under this belief, wewill further advance sustainability management that keeps contribution
to resolving social issues at the forefront of our mind to realize asustainable society and enhance corporate value.
* The idea that Sumitomo’s business activities not only benefit Sumitomo, but must also benefit nation andsociety around us in order to achieve sustainable growth together.

Masayuki Hyodo
Representative Director
President and Chief Executive Officer

4

CSO Message

CSO Message
Promoting Enhancement of
Sustainability Management toCreate New Value for Today
and Tomorrow
Since FY2020, Sumitomo Corporation has identified six key social issues
that are especially relevant to the Group’s business activities as well as
formulated and disclosed long-term and medium-term goals tocontribute toward resolving each of these issues to further promotesustainability management which we had been practicing since the past.
These key social issues are broadly categorized into two major themes:“sustainability of society” and “development and evolution of society.”
We think that contributing toward achieving these two themes is whatsociety truly expects of us today.
In the newly issued ESG Communication Book (Story Book), we haveshown our long-term value creation story from the perspectives of each keysocial issue. Potential risks may be exposed by the deepening severity of

Hirokazu Higashino

issues we face, but at the same time, there are even more business seeds.
We will steadily turn such opportunities into businesses, create new value,

Representative Director

and will lead to the sustainable growth for Sumitomo Corporation. In theManaging Executive Officer,

separate booklet ESG Communication Book (Disclosure Book), we have

Chief Strategy Officer andstated each organization’s status and efforts toward achieving ourChief Information Officer

medium-term goals. We hope you will take a look at both versions of ourChairperson of the Corporate

ESG Communication Book to deepen your understanding about our efforts

Sustainability Committee

for the enhancement of sustainability management. Please continue to holdexpectations about our future efforts.

Value Creation Model

Mitigation of climate change

Creating New Value for Today and Tomorrow
The Sumitomo Corporation Group’s value creation model is adiagram representation of the mechanism of value creation that
the Group has developed over the course of its history. At its
core are Sumitomo’s Business Philosophy and Sumitomo
Corporation Group’s Corporate Mission Statement that has
been passed down over the years. The model illustrates a cycleof creating value through our businesses and contributing to
the realization of a sustainable society, while leveraging andstrengthening the management bases, which is the product ofour collective strengths, to the fullest potential.
Management Bases

Circular economy
Respect for human rights

Sustainabilityof society

Metal Products
Achieving Harmony
with the Global
Environment Contributing to
the Developmentof Local Communities
and Industries

Transportation &Construction Systems

Realization ofa sustainable
society

Infrastructure

Sumitomo
Corporation
Group

Environmental
value
New

Socialvalue

value
creation

Development andevolution of society
Development of local
society and economy¥

Financial capital

Stable financial
position

Developing Human
Resources andPromoting Diversity

EvolveDesignCreation andenhancementof businesses

Economic value

Media & Digital

Human capital

Diverse humanresources

Sumitomo’s
Business
Philosophy

Intellectual capital

Mineral Resources, Energy, Chemical & Electronics

Multifacetedbusiness
expertise

Establishing a Foundation
for Comfortable andEnriching Lifestyles

Corporate Mission
Statement

Organizational/Group capital

Materialize

Large numberof group
companies

Change andsophisticationof markets

Living Related & Real Estate

Enhancing Governance

Energy Innovation Initiative (EII)

CreateProviding Diverse“Accessibility”

Global network capital

Extensive businesslocations

m
en
t

5

Business relationshipcapitalPresence in awide range
of industries

Brand capital

The trust placed in
the Sumitomo
Corporation
Group

t
en
em
g
a
n
Ma

ce
an
h
en
se
ba

Improvement ofliving standard
Qualityeducation

6

Value Creation Model

Sumitomo Corporation Group’s Value Creation Story
Growing Environmental
and Social Issues and Our Social
Responsibility as a Company

Contents
Values of the Sumitomo Corporation Group2

With Sumitomo’s Business Philosophy and the Sumitomo Corporation Group’s

Top Message

3

Corporate Mission Statement as the core,

CSO Message

4

Value Creation Model5

By maximizing the management bases (seven capitals) that we have developed over ourManagement Bases (Seven Capitals)

7

Utilizing Capital

100+ year history, and integrating and combining our diverse business functions,

Human Capital

8

Key Social Issues
and Business Creation

Leading to resolving the six key social issues identified in 2020, and pursuing the

6 Key Social Issues

9

What we have passed down
for 400 years

Values of the GroupStrengths of theSumitomo Corporation Group

Backcasting

The Sumitomo Corporation Group aims to be a global corporate group that
contributes to the realization of a sustainable society by creating new value throughthe creation of businesses, while constantly staying a step ahead in dealing withchanges to respond timely to environmental and social issues.

Creating Businesses

Simultaneous creation of social,environmental, and economic value

Creating Value

Realization ofa sustainable society

Looking Ahead to the Future

creation of new businesses and the enhancement of existing businesses,

Mitigation of climate change, Circular economy,
Respect for human rights, Development of local society and economy,
Improvement of living standard, and Quality education

Our Efforts to Take on Social Issues

We will create values for society, the environment, and the economy.

Hydrogen Business Potential for
Achieving Carbon Neutrality

29

Summit’s Initiative to Achieve a Sustainable Society

30
38

Roundtable Talk among Young Employees

43

We will pass on the Group’s management bases to the next generation, and continue
to create values and contribute to the realization of a sustainable society over the
next 100 years.

7

Utilizing CapitalManagement Bases

Creating Businesses

Creating Value

Looking Ahead to the Future

Sumitomo Corporation Group’s Management Bases
Increasing financial and non-financial management capital, the sources of our value creation.
As of March 31, 2022

Overview

Financial capital

Stable financial position

Human capital

Diverse human resources

We have a solid financial position owing to our balancing of theCore Risk Buffer (RB) and Risk-weighted Assets (RA) and ourstable financing. While expanding profitability with cash flow
discipline, we are working on further enhancing our financial
position and improving the stability of management.

We recruit human resources with diverse backgrounds, develop them as
professionals with extensive knowledge and expertise, and deploy
human resources, an important management resource, globally.

Characteristics of capital (typical indicators)

Main measures for maintaining and increasing capital

Total assets• Diversified range of financing sources in Japan and overseas• Maintaining balance between Core RB–RA• Enhancing cash management• Improving resilience and profitability through the Business Portfolio SHIFT- Exiting/turnaround of low-profitability businesses- Creating new core businesses- Improving probability of investment success by thorough investment discipline

Shareholders’ equity

Core RB–RA¥9.6 trillion ¥3.2 trillion +¥660 billion
Free cash flow

¥174.7

Net DERbillion*1

ROE

0.7 16

ROA%

5%

Number of employees (Consolidated basis)

74,253

P.8• Expertise in each business field (Project management skills, deep knowledge related to
products and industry, collective strength as an integrated trading company, etc.)• Mechanisms for creating new business opportunities (Introduction of initiative program,
GIPC*2, DX Center, 01 Challenge)• Sharing of business management expertise (implementation of GroupManagement Policy)• Companywide risk management (Investment risk, credit risk, market risk, country risk,social/environmental risk, natural disaster risk, etc.)• Implementation of many internal training programs (Sumisho Business College)

Diverse business domains

Intellectual capitalMultifaceted businessexpertise

We leverage our business expertise to develop, invest in, andmanage businesses. This expertise, in areas including risk
management, logistics solutions, and financial services, has been
built up over many years.

6 business units + 1 initiative

Diverse SBUsBusiness development
Business investment/management

Organizational/Group capital

Large number ofgroup companies
Global network capital

Extensive business locations
Business relationship capitalPresence in a wide range
of industries
Brand capital

The trust placed in the
Sumitomo Corporation Group

Owning world-class group companies in a wide range ofindustries, we use our accumulated management
knowledge to improve profitability and further strengthen
our business foundations.
Operating from offices located worldwide, we leverage our
network of ties with industry and government in each country toensure that our businesses are swift to identify and respond to
local needs.
By deepening our relationships with business partners that wehave cultivated in a variety of industries, we establish ourpresence in each industry, and implement multifaceted
development of the business.
We have lived by Sumitomo’s Business Philosophy, which has been
passed down for approximately 400 years, and the Sumitomo
Corporation Group’s Management Principles, which “place prime
importance on integrity and sound management.” This is an idealthat we have consistently embodied and will continue to honor.

• Utilization of pool of human resources at group companies• Sharing of best practices in group company management (such as for compensation system)• Sharing of corporate functions (shared services)• Dialogue with group companies using the Basic Elements, in which past business
management expertise has been gathered

Consolidated subsidiaries and associated companies(As of April 1, 2022)

893

Number of offices (As of April 1, 2022)

131 locations 66 countries and regions
100,000

Sumitomo’s Business Philosophy
Sumitomo Corporation Group’s Corporate Mission Statement
History of Sumitomo Corporation

103 years• Enhancement of profitability through combination of product and regional strategies• Timely capture of latent demand in each region and business development based onregional needs• Development of regional and management human resources• Building of intelligence functions in main offices• Enhancement of public relations activities, including participation in industry groups andpublic-private collaboration• Utilization of customer base and enhancement of communication in sales activities• Improvement of stakeholder engagement• Creation of business opportunities through corporate venture capital (CVC) activities and
MIRAI LAB PALETTE operations

Number of clients

Approx.

Human capital• Wide communication of top management messages• Enhancement of branding activities through embodiment of our Corporate
Message of “Enriching lives and the world”• Various training (level-specific training, Besshi Copper Mine visits, etc.)• Thorough compliance*1 Adjusted Free Cash Flow (After netting repayments of lease liabilities) *2 Global Innovation Promotion Committee

Utilizing CapitalManagement Bases

Creating Businesses

Creating Value

Looking Ahead to the Future

Human Capital
We will pursue our vision for “SC People” and “SC Organization” based on our Global HR Management Policy.

Right talent to the right assignments

Global Human Resources Management Policy
Vision for SC People

Vision for SC Organization

Top Tier Professionalism

Great Place to WorkThe Sumitomo Corporation Group aims to be a group ofindividuals who share the Group’s vision and mission,
maintain high aspirations and continuous intrinsic
motivation with an enterprising spirit, and create new value
on a global scale.

The Sumitomo Corporation Group seeks to build a greatplace to work, where individuals continuously andpassionately create new value. We aim to be anorganization recognized for nurturing talent that
continuously takes on new challenges throughout
the world.

Organizational
perspective

r
Tie
pTo

ls
iona
fess
Pro

Self-rea
lizat
ion

in

g

Developing talent who understand and embody Sumitomo’s
Business Philosophy, can take charge of business management,
and can work with the management of group companies
through diverse practical experience (on-the-job training) andlong-term training programs for selected employees (off-the-job
training)

Overseas training
program

Dispatching MBA, overseas, and language trainees

Swiftly and flexibly reassigning human resources according to
the Business Portfolio SHIFT, taking into account individual
aptitude and preferences

Performance management
Reform ofevaluation system(April 2021)

nc

op
le
ma
nag
eme
nt sk
ills

g
ntin
eme
Impl

Divers
Sum

Work

yf

b,

Pa

or
gf
n
ngin
Challe reatio
c
value

Fair
treatmentpeo r P e r f o r ma

to r oAu gnc

Development ofmanagerial talent

Shift of humanresources

Fair treatment

Absolute evaluation/360-degree evaluation
Evaluation based on the progress of strategy execution
Investment performance-linked compensation

Right talent
to the rightassignments

Performance
management

no
m
w
o
th us

ha

Off-the-job training programs provide opportunities toacquire broad-based business knowledge and skills alongwith insight

Individual
perspective

Development

Recruitment

En

Sumisho BusinessCollege (off-the-job
training program)

Grades are determined according to the significance of
duties. Seniority-based promotion has been eliminated. The
job grading system creates a foundation for promoting
flexible and optimal assignment of the right talent to theright assignments.
In FY2022, the scope will be expanded to thosere-employed after retirement.

e”

ng
di

Enhancing mid-career hiring at each level in addition to recruiting
new graduates for the purpose of addressing changes in thebusiness environment and improving diversity

Development

Introduction of ajob grading system(April 2021)

Individuals and organizations coming together for mutual growthJo

Recruitment
Diversification ofrecruiting methods

Creating new value for today and tomorrowfoWork environment

ro
tho

h
ug

ay
“P

Workplace culture

Inheritance of
Sumitomo’s Business
Philosophy

Conducting training annually at Besshi Copper Mine
(predecessor to Sumitomo Corporation)
All employees learn the history of Besshi Copper Mine uponjoining the Company

Acceleration ofDiversity & Inclusion(D&I)

Rolling out measures positioning D&I as a source ofcompetitiveness globally. In Japan, women’s
empowerment is regarded as a priority issue and measures
are implemented with numerical targets.

Health andproductivity
management

Rolling out various measures based on the belief that physicaland mental health are of utmost importance for individuals
to achieve their full potential

Workstyle reform

Remote work/Super flextime system introduced in 20180In-house entrepreneurship program aimed at creating new
businesses, developing human resources, and fostering aculture of taking on challengesr

The systems and environment surrounding employment are changing
rapidly. In Japan, a major shift is taking place in the individual’s view about
work from career advancement within a particular company based on
lifetime employment to realizing a career and personal growth matching
their own preferences.
In response to these changes, we have set forth a vision for employees(SC People) and companies (SC Organization) in a new era within our
Global HR Management Policy. Based on the concepts of expanding
Top-Tier Professionals, implementing thorough “Pay for Job, Pay for
Performance,” and enhancing people management skills, we are striving toestablish a work environment and workplace culture to serve as afoundation for growth and to improve the HR management cycle ofrecruitment, development, right talent to the right assignments,
performance management, and fair treatment.
Our vision for individuals and organizations is to provide a place where
highly motivated talent can realize autonomous growth and self-realizationand for their passion in taking on challenges to become the driving force
for organizational growth and value creation, with that cycle, in turn,
attracting further Top-Tier Professionals to enrich our reservoir of humancapital.
The roughly 74,000 people that make up the Group’s diverse humanresources will drive the creation of new value, maximizing the performanceof SC People and SC Organization to achieve that vision.

Ex
pa
n

8

1 Challenge

it y a n d Inclusion

itomo’s Business Philosoph yenvironment

lture
Workplace cu

WEB

Please refer to the ESG Communication Book
(Disclosure Book) for more information on each initiative.

6Key Social
Utilizing Capital

9

6 Key Social Issues
Humanity now faces a variety of challenges that stand in
the way of social sustainability.
Amid such circumstances, the Sumitomo Corporation
Group has identified the six key social issues in FY2020 inorder to further enhance its sustainability management.
We will achieve sustainable corporate growth andcontribution to the development of a sustainable society
by resolving social issues.

Creating Businesses

Creating Value

Looking Ahead to the FutureIssues
10

Utilizing Capital

6 Key Social Issues

Sustainability of the society

Creating Businesses

Creating Value

Looking Ahead to the Future

Development and evolution of the society

1. Mitigation of climate change

P.11

2. Circular economy

P.14

Sumitomo’s
Business
Philosophy

4. Development of local society and economy

P.20

5. Improvement of living standard

P.23

6. Quality education

P.26

Sumitomo Corporation Group’s
Corporate Mission Statement

3. Respect for human rights• Our diverse human resources
WEB

Material Issues
P.17• Multifaceted business expertise• Global networks

Please refer to the ESG Communication Book (Disclosure Book) for the key social issues and medium- and long-term goals.

• Business relations with partners and customers

11

6 Key Social Issues

1. Mitigation of climate change
Responsibility of the Sumitomo Corporation Group toachieve carbon neutrality by 2050

Significance of resolving the issue
Mitigating climate change is an important issue
that must be overcome to bring about asustainable society. Global efforts toward thefaster realization of a carbon-neutral society
are accelerating.
The Group values the global consensus of theParis Agreement and aims to play a more activerole in achieving the carbon neutrality goals ofsociety set forth in the agreement.
We will contribute to the resolution of climatechange issues through efforts in each businessfield by setting a long-term goal of “climatechange mitigation” and medium-term goals thatindicate a clear action plan for achieving thislong-term goal.

WEB

Please refer to the ESG Communication Book (Disclosure Book) for more
information on our climate change initiatives (disclosure based on the TCFD).

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

12

Utilizing Capital

6 Key Social Issues

Long-term goal

Creating Businesses

Creating Value

Looking Ahead to the Future

Medium-term goals

Reduce the Group’s CO2 emissions 50% or more by 2035 (compared to 2019)• Reduce CO2 emissions of the power generation business by 40% or more by 2035 (of which reduce 60% or more for coal-fired power generation
business); power generation portfolio in 2035 to comprise 20% coal-fired, 50% gas-fired and 30% renewables*1 in terms of net ownershipgeneration capacity.
• Reduce indirect CO2 emissions*2 associated with the fossil fuel upstream business by 90% or more by 2035.
• Reduce CO2 emissions in all other businesses*3.
Progress• At the next-generation distribution center in West Texas, United States,
completed shift to renewable energy (solar power) for own power
consumption• Reduced CO2 emissions and power consumption at plants manufacturing
automobile parts following factory refurbishment and installation of storage
battery systems

Aim for carbon
neutrality by 2050 andchallenge to realize
sustainable energy cycle• Installed energy-efficient refrigeration and freezing equipment and switched
to LED lighting in the supermarkets• Obtained Science Based Targets (SBT) certification at group companies (SCSK, Fyffes)• In principle, obtained CASBEE for newly developed logistics facilities• Obtained GRESB certification for the fund managed by our GroupWEB

Please refer to the ESG Communication Book (Disclosure Book) for
more information on CO2 emissions, etc.

Establish businesses that will form the foundation for a sustainable energy cycle in society• Develop hydrogen and other forms of carbon-free energy, increase supply of renewable energy (3GW or more by 2030)*4,
and expand new power and energy services.
• Expand businesses encouraging electrification, fuel conversion, improved energy and coal efficiency, and energy conservation.
• Capture, store and utilize CO2 via carbon recycling, forestry business, CCS, and emissions credit trading, etc.
Progress• Expanded the supply of renewable energy in Japan and overseas (2021: 1.5GW)• Expanded the provision of services contributing to the reduction of direct
CO2 emissions in oil and gas drilling operations• Launched trials of an EV car sharing service for corporate clients and an EV
taxi operation• Contributed to addressing climate change issues through expanding business invarious renewable energy sectors with a focus on solar power generation• Established joint venture to promote marine batteries that help reduce CO2 emissions• In the aircraft leasing and engine leasing portfolio, increased the portion of
more fuel-efficient and more environment-friendly aircraft and engines,
15–20% better in performance than the current-generation aircraft/engines• Supported the expanded use of EVs through the deployment of EV chargers
at parking lots in Northern Europe• Efforts for hydrogen-fueled aircraft businesses, realizing carbon neutrality• Contributed to the reduction of CO2 emissions by achieving lightweightaircraft using metal 3D printing technologies• Established the Energy Innovation Initiative (EII)• Implemented experimental demonstration of a hydrogen supply chain in partnershipwith the private sector and government ministries of Australia and Japan• Establishment of a joint venture for the development and operation of asolar power purchase agreement (PPA) business• Acquired additional forest assets in New Zealand*1 As of 2020: Coal 50%, gas 30%, renewables 20% *2 Indirect CO2 emissions generated by others with the use of fossil fuel*3 Contribute to CO2 reduction by setting targets for individual businesses *4 As of 2020: 1.5GW (1GW = 1 billion W)

13

Utilizing Capital

6 Key Social Issues

Creating Businesses

Creating Value

Looking Ahead to the Future

Aim for carbon neutrality by 2050 and challenge to realize sustainable energy cycle

Reduce the Group’s CO2 emissions 50% or more by 2035
(compared to 2019)

Establish businesses that will form the foundation
for a sustainable energy cycle in society

In the coal-fired power generation business, we aim to reduce CO2 emissions by

The Energy Innovation Initiative (EII), established in April 2021, aims to realize a sustainableapproximately 20 million tons by 2035 (compared to FY2019) by withdrawing existing assets

energy cycle and achieve decarbonization, and is engaged in cross-organizational efforts in theand ending contracts. Without exception, we do not engage in new coal-fired power

three key areas of “Developing carbon-free energy” (such as hydrogen and next-generation

generation projects or construction contracts. In addition, we are continuing to examine ways

bio-energy), “Expanding new power & energy services” (such as large-scale storage batteries

to promote decarbonization and low-carbonization for our existing facilities, as well as

and distributed power resources), and “CO2 capture, storage and utilization.”provide proposals and support for shifting power to renewable energy sources. We are also

In addition to these initiatives, we will continue to build businesses that serve as the basis

steadily implementing our exit from the fossil fuel upstream business, aiming to reducefor the sustainable energy cycle of society. This will be achieved through expanding the supply

indirect CO2 emissions from fossil energy concession by approximately 15 million tons byof renewable energy and the switching of fuels, electrification, and improvements to energy

2035. We have also begun using internal carbon pricing as a way to pursue new businessand carbon efficiency across various industries, along with the expansion of businesses that

opportunities, address risks, and encourage carbon neutrality.

promote energy conservation.

Milestones for reducing emissions to achieve carbon neutrality (millions of tons of CO2e)

Development of business foundation in the three focused areas

Total scope covered

Main reduction results in FY2020–FY2021

-7

60

1

Approx. 7 million t-CO2e reduction
compared to FY2019

Developing carbon-free energy(large-scale supply-driven systems)

Exit from the fossil fuel upstream business
Thermal power
generation
business(Incl. associatedcompanies[equity method])

ReduceFossil fuelupstreambusiness(Scope 3)

Sumitomo
Corporation,
subsidiaries(excl. power
generation business)

16
1
2019

40% or more

50% orReduceOf which, coal-fired
more overall
power generation:
Reduce 60% or more
• Exit and contract
termination of existing
assets: Approx. -20

43-7

ReduceNextHydrogen Ammonia Biomass generation
trade
biofuels

Projects for tight oil, shale gas, thermal coal mine,oil, and natural gas

90% or more

• Exit and sales ofexisting asset:
Approx. -15

Synthetic Biofuels chemicals

Segment/
SBU

2

Expanding power & energy services
Renewable (local production for local consumption)energyand environmental
value

EII’s threefocused areas

Large-scale Green
Hydrogen energy power
storage

Carboncredit

CCUS

Carbonmanagementbusiness

3
Achieving• Contract termination ofcarboncoal-fired power generation
neutrality
assets: Approx. -10
Net zero• Other asset replacement /CO2 emission
introduction of new technology /shift to new resource:
Approx. -10

2035(Base year)
CO2 capture, storage and utilization
Accelerating our carbon neutrality** By means recognized by international standards such as capture and storage by forests and other technical methods

2050

CO2 capture, storage and utilization
Forestry

Forestryrelated

Timberproduct
trade

SBU (EII as a whole)
Cross-Organizational Collaboration Platform by Theme• Carbon credit • Next-generation bio • Ammonia • Mobility and energy• Electric power balancing • CCUS • Steelmaking (zero-carbon steel)Districtheating

Regional
Organizations
GlobalCrossFunctional
Organizations
Businessdevelopment
organizations
CVCs
DX Center14

6 Key Social Issues

2. Circular economy
Helping to realize sustainable resource recyclingthat makes effective use of limited resources

Significance of resolving the issue
A variety of issues that threaten the sustainabilityof society have been brought to the fore, such as
the growing world population and the associatedincreases in demand for resources and energy andin the volume of waste. Rather than continuing
the conventional practices of mass production,
mass consumption, and mass disposal, building
circular economy systems through recycling,reuse, reproduction, resource-saving productdevelopment, and sharing, and reducing
dependence on natural resources are importantfor maintaining social sustainability.
The Group will make effective use of limited
resources and contribute to the realization ofsustainable resource recycling by switching toresource-saving technologies and products, andworking on sustainable procurement of
natural resources.

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

15

Utilizing Capital

6 Key Social Issues

Long-term goal

Creating Businesses

Creating Value

Looking Ahead to the Future

Medium-term goals

Use renewable and recyclable raw materials, collect waste, and promote improved efficiency of product usage• Expand use of raw materials derived from recycled or renewable resources.
• Improve efficiency of product usage and expand businesses that promote longer product life (sharing, sales of used items, leasing, rentals, etc.).

Shift to recyclable,
efficient technologies
and products

Progress• Promoted waste recovery/recycling businesses such as the PET bottle
recycling business• Used less resources by means of reuse and recycling, such as through recycling
waste within plants and increasing sales of high-performance resins• Increased the usage of recyclable raw materials, etc. through manufacturing
plastic substitute materials (plant-derived materials)• Achieved both a reduction in environmental impact and sustainableagriculture through sales and the widespread use of biopesticides and otherenvironmentally friendly products• Promoted efforts for extending product life through used car sales andafter-sales services• Promoted sharing and subscription businesses, such as EV car sharing services• Expanded collection and redistribution channels

Reinforce the sustainable procurement system for major natural resources used by the Group

Sustainable use ofnatural resources• Identify major natural resource-related commodities requiring sustainable procurement, establish procurement policy, promote certification,and strengthen voluntary auditing system.
Progress• Promoted sustainable forest management through establishment of ourForest Management Policy and the Sourcing Policy for Forest Products• Obtained Roundtable on Sustainable Palm Oil (RSPO) Mass Balance certification• Procured and promoted the widespread use of Bird Friendly®-certified coffee• Promoted sustainable procurement of biomass fuel such as throughmonitoring reforestation using remote sensing technologies (satellite
image analysis)

16

Utilizing Capital

6 Key Social Issues

Shift to recyclable, efficient technologies and products

Use renewable and recyclable raw materials, collect waste,
and promote improved efficiency of product usage

Creating Businesses

Creating Value

Looking Ahead to the Future

Sustainable use of natural resources

Reinforce the sustainable procurement system for major natural resources usedby the Group

Achieving sustainable resource recycling requires a mixture of efforts for the conservation ofForests are an important resource for the realization of a sustainable society. Apart fromresources through reuse and recycling without presuming the use of virgin materials, such asproviding food and wood products, they also contribute to the conservation of biodiversity

using materials repeatedly or recovering resources without throwing the materials away. The

and to the mitigation of climate change through the absorption and storage of CO2. As aGroup, which is engaged in a wide range of business areas, is also promoting a variety ofgroup that operates businesses using these precious forest resources, we believe in theefforts that contribute to the transition to a circular economy.

importance of managing forests and procuring timber in a way that will not lead to

Aiming to expand the use of recyclable raw materials derived from recycled or renewable

deforestation or human rights violations, and based on this, we have established the Forest

resources, the Group is engaged in waste collection and recycling, conserving resources

Management Policy and the Sourcing Policy for Forest Products. To further strengthen our

through reuse and recycling, manufacturing plastic substitute materials, and selling

procurement systems in line with these policies, we are promoting the acquisition of

biopesticides. Furthermore, with an aim of expanding businesses that promote improved

international forest management certification.

product usage efficiency and longer product life, we are also engaged in a wide range ofWe are also strengthening the sustainable procurement of natural resources apart fromundertakings such as the sale of used items and the promotion of sharing, leasing, andtimber. We are an ordinary member of the RSPO, and our group companies SC Foods Co.,rental businesses.

Ltd. and Summit Oil Mill Co., Ltd. have obtained RSPO supply chain certification. We also
import and supply Bird Friendly®-certified coffee as part of our biodiversity-friendly activities
that ensure a stable income for farmers.
WEB

PET bottle recycling business(Tomra Japan)

EV car sharing service in Sweden (Aimo Solution AB)

Please refer to our corporate website for more information on our Forest Management Policy andthe Sourcing Policy for Forest Products.

Ecosystem-friendly, sustainable forest management

Member of the RSPO

17

6 Key Social Issues

3. Respect for human rights
Respecting the human rights of everyone involvedin our business activities and supply chain aspart of our corporate social responsibility

Significance of resolving the issue
Realizing a society in which the human rights of all
people are respected requires human rights to berespected by all countries, regions, organizations,and people. The Sumitomo Corporation Group
carries out business activities based on theprinciple of never committing, allowing, or
tolerating human rights violations. As a corporategroup that operates business while engaging withmultiple stakeholders including customers, local
communities, and employees, we will strive torespect human rights throughout our businesses
and supply chains.

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

18

Utilizing Capital

6 Key Social Issues

Long-term goal

Creating Businesses

Creating Value

Looking Ahead to the Future

Medium-term goals

Promote and ensure respect for human rights in accordance with the United Nations Guiding Principles on
Business and Human Rights and Sumitomo Corporation Group’s Human Rights Policy• By 2023, achieve 100% participation rate in human rights education based on the Guiding Principles, and 100% implementation rate in regionalorganizations and subsidiaries.
• Strengthen risk analysis in human rights due diligence to accurately assess risks in all businesses, including the supply chain, and implement risk
mitigation measures by 2025. Establish a more effective grievance mechanism based on assessment results.
Progress• Completed development of content for human rights education tool(e-learning) (commenced rollout from FY2022)• Commenced human rights due diligence on a business-unit basis with theaim of covering all businesses by 2025. (In FY2021, covered the Media &Digital Business Unit and the Living Related & Real Estate Business Unit.)• Established a consultation desk on our corporate website as part of ourgrievance mechanism

Ensure a safe workplace environment
Respect human rights
through all ofour businesses
and supply chains• Strengthen efforts to achieve zero accidents at major business workplaces, focusing on manufacturing, processing, and projects involving
large-scale construction.
Progress• Implemented e-learning on emergency responses in the event of an
accident or a natural disaster, conducted lifesaving courses, and introduceda system for sharing damage situations• In the steel products business, conducted self-audits based on a safety

self-checklist (150 items) and promoted efforts for improvement• In the construction equipment sales and rental business, the lost time
incident rate (LTIR) was aggregated, and follow-up was provided to further
reduce accidents

Achieve a diverse organization grounded in mutual respect• Provide a safe working environment that is free from discrimination and harassment.
• Promote human resources management that enables individuals to demonstrate their abilities regardless of nationality, age, gender, sexual orientation,
gender identity, or any other attributes or values.
Progress• As part of activities raising awareness for human rights and Dowa issues(discriminated community issue), conducted training for Group executives
and employees led by an outside expert• Organized awareness-raising activities, such as training for the preventionof sexual harassment and power harassment, in order to eliminate allforms of harassment• Launched a company-wide working group to enhance employee
engagement• Planned and hosted Diversity Week—an intensive period of diversity andinclusion (D&I) programs—as part of our ongoing internal
awareness-raising efforts to instill D&I in the organization• In Japan, numerical targets were set, mainly for promoting women’s
participation and advancement in the workplace, and efforts are being
made to permeate and instill D&I through measures and actions aimed atachieving those targets. Coordination has also been strengthened atoverseas regional organizations, such as by supporting the promotion of
D&I measures tailored to the actual circumstances of the sites in eachcountry (holding Global D&I Meetings on a regular basis)

19

6 Key Social Issues

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

Respect human rights through all of our businesses and supply chains

Promote and ensure respect for human rights in accordance with the United Nations
Guiding Principles on Business and Human Rights and Sumitomo Corporation Group’s
Human Rights Policy

Ensure a safe workplace environment
We aim to strengthen efforts to achieve zero accidents at work sites, focusing on business

The Group has established the Sumitomo Corporation Group’s Human Rights Policy andoperations with high risk in terms of danger and serious injury, such as manufacturing,

respects human rights through human rights due diligence, stakeholder engagement, andprocessing, and projects involving large-scale construction. We are striving to prevent

internal education as we aim to grow sustainably with society. To assess the Group’s overall

recurrence and reduce the number of work-related accidents, such as by implementing

impact and risks to human rights, we identify human rights issues that need to be prioritized,

self-audits based on checklists, increasing efforts for improvement, using educational tools,

and then examine and implement action plans to prevent and mitigate specific risks starting

and taking appropriate and quick reactions (grasping accurate information and puttingwith areas of high priority.

tentative countermeasures into action based on cause investigations) in the event of an

We have also initiated human rights due diligence on a business-unit basis with the aim ofassessing risks and implementing risk mitigation measures across all businesses, including

accident.
The Group is promoting the establishment of a global health, safety, security, andsupply chains, by 2025. In FY2021, we conducted human rights due diligence for two of ourenvironment (HSSE) network, and in addition to undertaking educational activities related

six business units: the Media & Digital Business Unit and the Living Related & Real Estate

to general safety measures, including public safety measures and prevention of infectious

Business Unit. We identified and assessed human rights risks based on the businessdiseases, it is preparing manuals, developing impact based BCPs that can be used tocharacteristics of the two business units, and we have confirmed that supplier investigations,

respond to multiple hazards including natural disasters and conducting various types ofimprovement activities and other steps are being taken to address any risks of concern.

training and drills.

Through human rights due diligence, we will continue to strengthen risk assessment,
formulate action plans for risk prevention and mitigation, and make preparations for
future monitoring.
WEB

Please refer to the ESG Communication Book (Disclosure Book) for more information on
the human rights due diligence process and results.

Achieve a diverse organization grounded in mutual respect
Aiming to provide a safe working environment that is free from discrimination andharassment, we promote human resources management that enables individuals todemonstrate their abilities regardless of nationality, age, gender, sexual orientation, gender
identity, or other attributes or values. Our Global HR Management Policy advocates for D&I,
and in addition to planning and hosting Diversity Week—an intensive period of related
programs as part of our internal awareness-raising activities—we are working on various
measures to further promote D&I at Japan and overseas
regional organizations.

Launched a human rights e-learning program for all executives and employees

20

6 Key Social Issues

Utilizing Capital

Creating Businesses

4. Development of local society and economy
Contribute to development of local industries, human resources,
and industrial and social infrastructure

Significance of resolving the issue
The Sumitomo Corporation Group’s business is
expanding to countries and regions around theworld. Our goal is to contribute to thedevelopment of communities through all ourbusiness operations. We will continue tocontribute to industrial development as well as
human resources development in local
communities and endeavor to provide industrial
and social infrastructure.

Creating Value

Looking Ahead to the Future

21

Utilizing Capital

6 Key Social Issues

Long-term goal

Creating Businesses

Creating Value

Looking Ahead to the Future

Medium-term goals

Develop local industries, create jobs, and develop human resources through the Group’s global business operations

Contribute to developmentof local industries andhuman resources• Promote sustainable, highly productive and value-added industries, and coexist with local communities through business.
• Create employment and develop management and highly skilled human resources at the Group’s business sites.
Progress• Promoted the overseas industrial park business• Promoted efforts by a wide range of companies for SDGs through theprovision of sustainable leases and financing, such as SDGs Lease• In the supermarket business, expanded the introduction of new service
menus, with stores functioning as local community hubs

• In the upstream metal resources business, continued to trade with local
suppliers• Developed human resources at sites in each business by providing training
opportunities

Establish industrial and social infrastructure that contributes to the sustainable development of society

Develop industrial andsocial infrastructure• Promote infrastructure that enables access to high-quality energy, water, transportation, logistics, communications, and financial services, as well as
businesses that enhance urban functions.
Progress• In the power generation business, maintained stable operations at existing
power plants currently in operation• Increased treatment capacity by 56% (compared to FY2020) by expanding
the water business• Received orders for new rolling stock and railway systems, steadily
fulfilled contracts• Worked to resolve the social issue of traffic congestion by expanding therailroad business• Began developing telecommunications infrastructure in Ethiopia

22

Utilizing Capital

6 Key Social Issues

Contribute to development oflocal industries and human resources

Develop local industries, create jobs, and develop human resources
through the Group’s global business operations

Creating Businesses

Creating Value

Looking Ahead to the Future

Develop industrial and social infrastructure

Establish industrial and social infrastructure that contributes tothe sustainable development of society

We aim to promote sustainable, highly productive, and value-added industries, and coexist

Aiming to promote the building of infrastructure that enables access to high-quality energy,

with local communities through business. Specifically, we promote efforts to build local social

water, transportation, logistics, communications, and financial services, and projects toinfrastructure that supports people’s lives, such as job creation and regional development

enhance urban functions, we are working to provide high-quality social infrastructure,through the promotion of overseas industrial park projects and the attracting of business, job

including water projects in China and Brazil and railroad projects in Southeast Asia, stabilize

creation, and contribution to the growth of local industries through development around

operations at existing power plants, and develop

mines. In the supermarket business, we contribute to local communities through supportive

telecommunications infrastructure in emerging

participation in community-based events, handling locally grown vegetables, and also accept

countries such as Ethiopia. We will continue to build

technical trainees from overseas.

and maintain good relations with local communities

To create employment and develop management and highly skilled human resources atand deepen our cooperation with business partners,

our business sites, we are also working to expand transactions with local suppliers, create

while complying with the environmental standards

local opportunities for stable employment, and provide job training programs that support job

and other regulations of the countries in which

seekers in enhancing their skills.

we operate.

Overseas industrial park business (Vietnam)

Trainees on vehicle maintenance, parts warehousemanagement, and customer services (Iraq)

Employees involved in the telecommunications
business in the field (Ethiopia)

Contributing to more widespread use of water supply and sewerage systems and to better operational quality (Brazil)

23

6 Key Social Issues

5. Improvement of living standard
Aiming to provide advanced services andnew functions through diverse businesses
and new technologies and concepts

Significance of resolving the issue
The world’s population continues to grow, andmany areas are facing problems such asurbanization and aging population. The Sumitomo
Corporation Group will make efforts to provide
advanced life-related services that help to resolvethese problems and contribute to a better life forall people.

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

24

Utilizing Capital

6 Key Social Issues

Long-term goal

Creating Businesses

Creating Value

Looking Ahead to the Future

Medium-term goals

Deliver advanced lifestyle services that help to solve social issues such as urbanization and aging populations• Provide more advanced services and new functions that improve the standard of living, such as mobility, media and telecommunications,healthcare services, and Smart City development, based on new technologies and concepts.
Progress

Provide advanced
lifestyle-related services• Began demonstration of the mobile shop services business that capitalizes
on mobility• The North Hanoi Smart City: Progress being made in land expropriation;
drafted a town management business plan and concept• Established additional local 5G base stations; conducted a proof of concept
with cable TV operators and railroad operators for the development ofuse cases• Through JCOM, provided entertainment and lifestyle services, such as
Cable TV, internet, fixed phone, electric power, and mobile phone (5.58
million households)• Launched telemedicine service through cable TV (J:COM)• Providing carefully curated products and services such as fashion items andbeauty-related products via Shop Channel, and launching a livecommerce business• Provided sales of pharmaceuticals and daily necessities with the functionsof a dispensing pharmacy through the Tomod’s model of drugstore withdispensing function (237 stores as of the end of FY2021), and enhanced
the functions of dispensing pharmacies by offering home dispensing andonline dispensing services• Entered the managed care business in Vietnam• Developing precision farming technologies and services that contribute toimproved crop production and reduced workload through collaboration
with new business partners and associated companies

25

Utilizing Capital

6 Key Social Issues

Creating Businesses

Creating Value

Looking Ahead to the Future

Provide advanced lifestyle-related services

Deliver advanced lifestyle services that help to solve social issues suchas urbanization and aging populations

Healthcare
We are strengthening efforts to develop new business models that lead to more efficient

We have a variety of initiatives to help improve living standards. We aim to provide more

control of medical expenses, such as the managed care business in emerging countries, andadvanced services and new functions that improve people’s standard of living, such as

expand digital health businesses using technological innovations such as IoT and AI. In ordermobility, media and telecommunications, healthcare, and Smart City development, based on

to do so, we are utilizing our existing business foundations and functions, such as the

new technologies and concepts.

dispensing pharmacy platform that we established, which is one of the leaders of integrated
community care systems, and our support of drug discovery.

Mobility
We are working on the development of new automobile parts, the development of

Smart City Development

cutting-edge technologies such as autonomous driving and connectivity, and mobility andWe will integrate the real estate business and infrastructure business, both of which theperipheral services such as EV car sharing and EV charging.

Group has extensive experience in, and undertake efficient management of community
development utilizing digital infrastructure*. At the same time, we will utilize various smart

Media and Telecommunications

services and the data obtained from these initiatives to promote community development for

Utilizing the platform developed through our cable TV business in Japan, which we haveachieving sustainable growth.

operated for over 30 years, we began providing online medical services such as medical* Integrated IoT platform for integrating, accumulating, and analyzing community data

appointments and interviews at medical institutions as well as medical examinations via
webcam. In the future, we will consider providing services such as online medication
guidance. We aim to expand community-based lifestyle-related services in collaboration withother businesses, such as in the mobility field and Smart City development. To help resolve
social issues through 5G infrastructure construction and solutions development, we are also
working on our base station sharing business and local 5G business for regional communities.
Telemedicine service throughcable television (J:COM)

Image of 5G base station sharing coverage area

Pleasant living environment surrounded by waterfronts and other natural scenery (Smart City development)

26

6 Key Social Issues

6. Quality education
Aiming to “contribute to quality education”
as the basis for resolving all social issues

Significance of resolving the issue
Quality education plays an important role inrealizing a better future. This is because education
leads to the development of human resources
capable of resolving the many social challenges
facing the world. The Sumitomo Corporation
Group is engaged in various activities aimed atcontributing to quality education.
One such activity is 100SEED, a global social
contribution activity program that was launchedin 2019 to mark the Group’s 100th anniversary.
Under the program, Group employees
around the world conduct activities together inconsideration of the society over the 100 years.
Adopting SDG 4: Quality Education as a global
theme, employees tackle education issues aroundthe world by participating in activities themselves.

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

27

Utilizing Capital

6 Key Social Issues

Long-term goal

Creating Businesses

Creating Value

Looking Ahead to the Future

Medium-term goals

Provide quality and equal learning opportunities through 100SEED* activities• Quantitatively expand the scope of learning opportunities.
• 100% satisfaction of beneficiaries.
• Continue to have at least 5% of all employees participate annually (scope is Sumitomo Corporation, regional organizations and group companies).

Contribute toquality education

Progress• Implemented 44 projects for 100SEED activities in 16 countries around theworld to address local educational issues• More than 5% of employees participated at the Head Office and regionalorganizations in Japan and overseas• 100SEED received a special award at the 19th Corporate Philanthropy Awardin recognition of company-wide efforts involving both employees andmanagement• Through the “Mirai School” career education support program, provided
career education to 3,800 students at 24 high schools• Through “Pro Bono Educational Support,” assisted eight non-profit
organizations (NPOs) strengthen their organizational foundations• Through “Educational Support for a Multi-cultural Symbiotic Society,”provided support to eight NPOs and children with foreign roots• Achieved nearly 100% satisfaction among beneficiary NPOs and highschool students* Social contribution activity program with employee participation at the Sumitomo Corporation Group

28

Utilizing Capital

6 Key Social Issues

Creating Businesses

Creating Value

Looking Ahead to the Future

Contribute to quality education

Provide quality and equal learning opportunities through 100SEED activities
We have 44 projects underway in 16 countries around the world, in which 765 employees
participated in FY2021.
Internships for University Students

Educational Support for a Multi-cultural Symbiotic Society

Japan

Focusing on vulnerable support systems for youths with foreign roots living in Japan, we

Overseas

In China, our employees give lectures to local university students on the functions of a trading
company, providing them with an opportunity for hands-on work experience and to think
about connections with future careers and studies, thereby helping to nurture the next
generation of human resources who will lead the future.

provide operational support to NPOs that provide them assistance, and we engage in activities
that serve to support their learning and career education.

Educational Support That Matches Diverse Needs
Sumitomo Corporation Thailand carries out the following three activities that are designed to“Mirai School” Career Education Support

provide sustainable education from upstream to downstream: “BUTTON UP” to create equity

Through “on-site classes” delivered by our employees, we provide high school students whoand quality of education for the primary school students in underprivileged locations, “LIGHT

do not have a clear image of the connection between their studies and the future career with

UP” to train acquired skills to teachers to provide quality education, and “POWER UP” toopportunities to think about their future, thereby contributing to the development of the next

deepen the understanding of university students regarding business.

generation of leaders.
Bringing Smiles to Children’s Faces through Online Classes—“Mission Earth”
Pro Bono* Support for Educational NPOsIn Turkey, we are involved in a project called “Mission Earth”, which gives lessons to children

Utilizing the skills and experience ourin middle school, introducing them to the concepts of sustainability and the SDGs in

employees have cultivated through theircollaboration with a local NPO.

work, we support NPOs involved inWEB

education to enhance their managementfoundations, thereby contributing to theresolution of a range of educational issues.
* Our business skills and experience are offered free of charge to help
meet social challenges

Please refer to the ESG Communication Book (Disclosure Book) for more information on
examples of our initiatives around the world.

Resolving
Utilizing Capital

29

Our Efforts toTake on Social Issues
Focusing on resolving the six key social issues,
the Sumitomo Corporation Group will contributeto the realization of a sustainable society
by creating new value through our business.

Creating Businesses

Hydrogen Business Potential for
Achieving Carbon Neutrality
P. 30

Creating Value

Looking Ahead to the Future

Summit’s Initiative to
Achieve a Sustainable Society
P. 38

Utilizing Capital

30

Our Efforts to Take on Social Issues— 1

Hydrogen Business Potential for
Achieving Carbon Neutrality
The Sumitomo Corporation Group is committed tothe hydrogen-related business, as we were one of
the first to recognize it as an important key toachieving carbon neutrality.
The commitment to build a next-generationenergy system that includes hydrogen is a major
step toward the realization of a sustainable
society as well as the creation of new businesses
for the Group.

Creating Businesses

Creating Value

Looking Ahead to the FutureUtilizing Capital

Hydrogen Business Potential for Achieving Carbon Neutrality

Hydrogen business forms the core of
our carbon neutrality efforts

Creating Businesses

Creating Value

Looking Ahead to the Future

Malaysia, and import and distribution business in Japan’s

method of decarbonizing the base power that contributes to

Chubu region. In April 2021, we established the Energy

the improvement of renewable energy usage rates. In the

Our mission as a corporation is to achieve carbon neutrality

Innovation Initiative (EII) as a business organization optimized

non-power sectors, hydrogen will span sectors such as heatby 2050 and realize a sustainable energy cycle. The entire

for the entire company that contributes to the realization of asources, chemical materials, and reducing agents. We willgroup is working as one to achieve these goals. We begancarbon-neutral society. Our Hydrogen Business Department isleverage our group’s business expertise and network, not

our hydrogen-related business in 2015, and launched ourpart of the EII business line, and our goal is to create synergy

only for hydrogen but for other next-generation energy

Hydrogen Business Department in 2020. We have taken the

between them.

sources such as synthetic methane, creating large-scalelead in efforts aimed at cultivating the hydrogen market, such

For realizing a decarbonized society, hydrogen is expected

as our local production for local consumption project into play a major role in both the power and non-power

Australia, our creation of a large-scale supply chain in

sectors. In the power sector, it will serve as an effective

demand and building value chains.
Please refer to the Integrated Report for more information on the EII.

WEB

Overview of sustainable energy cycle
Production

Storage / Transport

Wind power

Electricity trading &balancing market

Consumption
Manufacturing/
Commercial/
Real estate sector

Virtual power plant (VPP)
aggregator

Rooftop solar

Large-storage
battery

Internet

Stationary battery Ground source heatAC / Heat pump

Exhaust heat/
Cryogenic energy

Solar power
Electric power network

Fossil fuelDistribution
thermal network

Substation

Delivery/Receiving/
Storage Marine carrier transportation Storage(methylcyclohexane)
Mixed

Renewable energy Renewable energy
Ammonia
Hydrogen

Delivery/StorageInland transportation(liquid state at -253°C)

Steel manufacturing(hydrogenreduction method)

Electricity retailCommercial

Residential

Receiving/
Storage
Hydrogen power
generation

Petroleum refining(desulfurization)

Hydrogen

Smart City

High-pressure Renewabletank transportation energy

Hydrogenproduction

Local production and consumption of hydrogen

Hydrogen absorbing alloy (MgH2)
Ammonia

Mobility sector

Ammonia network

Biomass

Pipeline

Vessel (NH3, H2 fuel) Construction equipment(electric / fuel cell)

Hydrogen network
Fossil fuel(blue hydrogen)Dehydrogenation (NH3
Biofuel / Fertilizer

Carbon recycling(including methanation)

Crop

CO2 emissions

Distribution
network

Hydropower Geothermal
power

CO2 emissions

31

Railway Internal combustion

engine vehicle

H2)

Biofuel network(Hybrid)

Methane network(City gas)

Aviation(SAF/H2 engine)

Fuel cell vehicle

Forklift(electric / fuel cell)

EV, E-Bike

Carbon sector
CO2 capture,storage andutilization

Carbon credit

Carbon footprint

CCUS

ForestBlue carbon

CO2 capture,storage andutilization

32

Utilizing Capital

Hydrogen Business Potential for Achieving Carbon Neutrality

Leveraging our strengths as an integrated trading
company to accelerate businessdevelopment globallybe broadly divided into three categories: (1) local production

U.S.A.

of hydrogen for local consumption, (2) creation of large-scale

Business partnership in
the hydrogen delivery fieldcommercialization by scaling up and systematizing thecreate a comprehensive support structure.
Linking supply and demand is vital for the advancement

U.K.

Electrolysis device
business partnership(AP Ventures)(ITM Power)

IsraelInvestment in developerof a CO2-free process
for producing hydrogen

U.S.A.

Hydrogen-focusedcommunity development

Green hydrogen projectusing hydroelectric power

Japan
Singapore

Joint study forammonia bunkering

Colombia(Syzygy)

Supply of green/blue hydrogenfor mobility applications
Hydrogen local production,
local consumption project
Large-scale supply chain creation project
Tolling and service platform business
Investment in new technologies

of our projects, so we secure core consumers and develop

Chile

Joint study for green hydrogenand ammonia production(Namie, Fukushima Prefecture)(Sarawak)(H2Pro)Investment in new
photocatalyst technologies

technologies. We coordinate with Japanese engineering
companies, manufacturers, and other outside partners to

U.K.

Investment in new technologies
in the hydrogen field

Malaysia(OneH2)

to meet the needs of individual regions and applications. We
breakthroughs, and strive to create a roadmap for

Looking Ahead to the FutureJapan

platform business. We conduct business by combining these
also invest in new technologies that lead to future cost

Creating Value

The main hydrogen-related projects being carried out by Sumitomo Corporation

The Sumitomo Corporation Group’s hydrogen business caninternational supply chains, and (3) tolling and service

Creating Businesses

Hydrogen import and distribution business/promotion of hydrogen utilization(Hydrogen Utilization Study Group in Chubu)

Australia

Australia

Green hydrogenproject using solar power

Blue hydrogen project(HESC Project, Victoria)(Gladstone, Queensland)

supply sources. Our biggest strength in the hydrogenbusiness sector is that we have access to the major

The outlook for Sumitomo Corporation’s hydrogen businessconsumers in almost all the industry sectors around the world
through our group’s existing business. We consider thathydrogen has various functions to create synergies among
different industries and applications, and enables to promoteenergy transition and decarbonization. We will nurture ourhydrogen business as the future revenue pillar of our group

Creating a
local production,
local consumption
model

while we create environmental and social value by mitigating

Lateral expansionof local production,
local consumption model

Widespread expansion of
local production,
local consumption model

Creation ofa large-scale value chain

Creation of large-scale value
chains in multiple regions

climate change and producing sustainable economies.

–
During this phase, we will build a businessmodel in which hydrogen is used where itis produced, eliminating the cost bottleneckof ocean transport. We are currently
establishing operations in the Japanese cityof Namie, in Fukushima Prefecture, and in
the Australian city of Gladstone.

–
During this phase, we will strive to build aglobal supply chain based on anchor demand.
Through our Australian Hydrogen Energy
Supply Chain (HESC) Project, we areconducting hydrogen production, liquefaction,and transport verification testing.

and beyond
We target widespread expansion of our local
production for local consumption model invarious geographical regions. Our global
supply chain will aim to provide compoundvalue chains that combine tolling and service
platform business.

33

Utilizing Capital

Hydrogen Business Potential for Achieving Carbon Neutrality

Creating Businesses

Creating Value

Looking Ahead to the Future

Examples of Sumitomo Corporation Group’s Hydrogen Business Initiatives
Hydrogen local production, local consumption project

Large-scale supply chain creation project

Large-scale supply chain creation projectGreen hydrogen local production,
local consumption project in Gladstone, Australia

Green hydrogen project in Sarawak, Malaysia

In this project, we plan to produce green hydrogen in Gladstone, aconcentrated industrial area that is optimally suited for solar power
generation. With Rio Tinto alumina refinery as an anchor consumer ofthis hydrogen, we are also creating further demand for this hydrogen,such as use in the fuel cells used by buses, trucks, ferries, and the like.

This project is using the abundant and inexpensive hydroelectric powerin Sarawak to generate green hydrogen that is used locally as well as
exported. We plan to generate several tens of thousands of tons ofgreen hydrogen each year, making the site a hydrogen supply basein Asia.

Hydrogen local production, local consumption projectCommunity development project leveraging
hydrogen in Namie, Fukushima Prefecture

P.36

We have concluded a collaboration agreement with the town ofNamie, using hydrogen to support community development efforts.
Through this project, we are promoting the widespread use ofhydrogen, rooted in the lifestyles of members of the community, andcommercialization studies regarding the creation of a multifunctionalhydrogen station.

P.34

Large-scale supply chain creation project

HESC blue hydrogen project in Australia
We are creating a supply chain in which we produce blue hydrogenfrom lignite in Victoria, Australia, liquefy it, and transport it to Japan.
This is the world’s first project involving the large-scale internationaltransport of liquefied hydrogen.

Tolling and service platform business

Carbon neutral methane production andexport project in Malaysia

Hydrogen import and distribution projectin Japan’s Chubu area

We are creating a supply chain in which we produce carbon neutral
methane using methanation technologies (technology that uses
chemical reactions between green hydrogen and CO2 to produce
methane), focused on the Japanese city gas market.

This project aims to create hydrogen import, storage, and delivery
infrastructure essential for the large-scale importing of hydrogen. The
project’s goal is the early establishment of an imported hydrogenacceptance site that will serve as a hydrogen supply hub for consumers
in the Chubu area.

34

Hydrogen Business Potential for Achieving Carbon Neutrality

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

Project Report 01

Green Hydrogen Projectin Sarawak, Malaysia
Bakun Dam (An existing dam in Sarawak)

Building a next generation energy supply chain
based on green hydrogen, contributing to
the mitigation of climate change and the realizationof a circular economy

utilizing the area’s rich water resources. The plan is to utilize

Sumitomo Corporation has long and close ties with theexisting infrastructure and ships to maintain cost

Malaysian state of Sarawak. It is home to companies such ascompetitiveness while rapidly establishing our supply system.

Press Metal, an aluminum smelting company, and Sakura

Through this, we intend to capture new hydrogen demand.

Ferroalloys, a manganese alloy producer in which we have

The geographical proximity of Malaysia and Japan also

invested that operates using green hydroelectric power. Since

provides an advantage to this project.

this hydrogen partially within Malaysia while also exporting
large amounts to Japan. To export the hydrogen, we firstplan to convert it to a carrier and handle it by utilizing

2018, we have worked together with Sarawak’s government
to explore the potential to create a hydrogen supply hub for
Asia by utilizing rich water resources and power in Sarawak.
In November 2019, we began a pre-feasibility study with thestate government. Other Japanese partners then joined us in
2020, and we have been conducting a feasibility study
together with them.
We are studying to produce green hydrogen by using
electrolysis devices together with green hydroelectric power

An image of a hydrogen station in Malaysia

Sarawak

Kuala Lumpur

35

Utilizing Capital

Hydrogen Business Potential for Achieving Carbon Neutrality

Creating Businesses

Creating Value

Looking Ahead to the Future

Project Report 01 Green Hydrogen Project in Sarawak, Malaysia

Aiming to achieve carbon neutrality by 2050 throughour green hydrogen projects

to the development of new local industry, the accrual of

We are almost completing our feasibility study to establish adevelopment of local society and economy. At the same time,

CO2-free green hydrogen supply chain, and expect to start

the project will also work toward the creation and export ofthe commercialization from the late 2020s, beginning withseveral tens of thousands of tons of hydrogen each year,

the production of hydrogen for consumption within Sarawak.

intended for the Japanese market. This will contribute to theThis local production for local consumption project will assist

Japanese government’s target of consuming three million

with the decarbonization of the state. It will also contributetons of hydrogen by the year 2030.

technical expertise, the creation of new jobs, and theHydrogen

Conceptual image of supply chain
Malaysian production and shippingof green hydrogen

Oceantransport

Resolving key social issues
The impacts of this project

Impact 1
Contributions to the mitigation of climate change
Producing green hydrogen using renewable energy (hydroelectric
power) will dramatically reduce CO2 emissions through the entire
supply chain, from production site to consumption site, thereby
helping mitigate climate change.

Methylcyclohexane

Hydrogen usage in Japan

Scope of commercialization deliberation project
Production using greenhydroelectric power

Conversion tomethylcyclohexane

Hydrogen extraction

Impact 2
Contributions to the development of local society and economy

Hydrogen usage
in JapanLocal production,
local consumption in Sarawak

By starting with local production, local consumption of hydrogen in
Malaysia, the project will contribute to the development of new local
industry, the accrual of technical expertise, the creation of new jobs,
and the development of local society and economy.

36

Utilizing Capital

Hydrogen Business Potential for Achieving Carbon Neutrality

Creating Businesses

Creating Value

Looking Ahead to the Future

Project Report 02

Community Development Project
Leveraging Hydrogen in Namie,
Fukushima Prefecture
Trial ride on FC PIUS, a hydrogen fuel cell go-kart (Photo credit: Namie Town)

New community development centered on
the use of clean energy

cooperate in hydrogen utilization and communityhydrogen to perform new community development. Thisdevelopment measures. Since then, we have been providing“Fukushima model” will be shared with the rest of Japan and

The entire population of the town of Namie was forced tosupport for the town’s community development efforts. This

the entire world. Specifically, Namie and Sumitomo Corporation

evacuate as a result of the Great East Japan Earthquake andproject doesn’t simply consist of the introduction of hydrogenare carrying out three types of initiatives.

the nuclear power plant accident in 2011. In March 2017,

infrastructure. Instead, its concept is the popularization andevacuation orders were lifted for some areas, and starting inpromotion of hydrogen usage rooted in the lifestyles of local

1. Community development using hydrogen power

2020, community development and restoration measuresresidents. We have positioned the project as an opportunity

We have carried out hydrogen awareness-raising activities

centered on hydrogen began in Namie in conjunction withfor us to take on new challenges as a corporation with theand deliberated regarding the installation of a multifunctional

the completion of the Fukushima Hydrogen Energy Research

aim of creating social, environmental, and economic value.

hydrogen station with the aim of enabling members of theField, equipped with a large-scale water electrolysis device

Through our initiatives in Namie, we are quantifying

community to experience the new value that can be providedhydrogen production facility. Sumitomo Corporation took theenvironmental value (environmental impact reductions suchby using hydrogen. These awareness-raising activities

lead in searching for ways to contribute to Namie. As a result

as reductions in CO2 emissions) and social value (raising theincluded the holding of the “1st Namie Hydrogen Festival”

of our deeplevel of happiness among residents and increasing thein August 2022 to foster a greater familiarity with hydrogen

exploration of theamount of population inflow) while verifying hypotheses

among the residents of Namie. The multifunctional hydrogenarea’s needs,

regarding how these values can contribute to our

station deliberations were conducted by ourselves, Namie’s

which included

corporate value.

town hall, and related companies with the aim of creating a

on-site interviews,

Fukushima Hydrogen Energy Research Field(Photo credit: NEDO)

The agreement defines the project’s concept as “Creating

new type of hydrogen station that not only supplies fuel-cellin January 2021

an energy shift in Namie that the whole world will want tovehicles with hydrogen, but also contributes to the use of

we concluded an

imitate.” Under this concept, Namie and Sumitomo Corporationhydrogen in diverse types of mobility (automobiles andagreement withwill lead a shift from existing fossil fuel energy to renewablemicromobility uses such as bicycles and push scooters) and as

Namie toenergy, leveraging distributed clean energy sources such as

an energy source for homes and facilities.

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Hydrogen Business Potential for Achieving Carbon Neutrality

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

Project Report 02 Community Development Project Leveraging Hydrogen in Namie, Fukushima Prefecture

2. System and space creation
We utilize the functions of MIRAI LAB PALETTE*, a forum

3. Community development through the Namie Station
area improvement projectthat we direct and operate in Otemachi, Tokyo, to provide

In September 2021, we concluded our second collaboration

systemic support that helps contribute to a greater influx andagreement, through which we are participating in a Namie

long-term retention of residents. For example, PALETTE’s

Station area improvement project. World-renowned architect

networking event, “Meet up!”, provides a space for

Kengo Kuma and Junji Ito, a professor at Tokyo University ofinteraction and sharing between parties in Namie andthe Arts, are involved in building and town design. We are

PALETTE members.

working to make the area a pioneering “100% renewable* MIRAI LAB PALETTE: An open innovation laboratory that promotes
collaboration in creating new value with partners from a variety of sectors

energy area” which will serve as a hub of local production for
local consumption of hydrogen and renewable energy.

Creating a circular economy through the EV storage battery center project
We worked with 4R Energy Corporation, a joint venture between Sumitomo Corporation and Nissan Motor, to develop technologies forusing reused batteries formerly from EVs for large-scale power purposes, and in April 2022 we began the operation of “EV Battery
Station Namie.” In this project, with the assistance of Fukushima Prefecture commercial development subsidies, we are collaboratingwith Namie in development activities. We are storing and managing the performance of recovered reused batteries, and at the sametime, using them as a battery center to provide
Conceptual diagram of the EV Battery Station
supply and demand adjustment services for the
Zero emissions solutions
power grid as a circular business model. We will
Solves the problems
faced by power
Expands the use oftransmission lines
renewable energy
Scalable High output and high capacity
continue to verify the usability and reliability of the
Swappable Replaceable batteries
ReusedInspection
center’s design, and plan to launch a large-scale
Speedy & Safety
batteries
Short construction period and high level of safety
Sortingbattery business for the supply and demand
Installation
adjustment market in 2024. Through thisEVlarge-scale battery project, using reused batteries,
batteries
EV Battery Station
we are promoting the regional use of renewableenergy (local production for local consumption).

Resolving key social issues
The impacts of this project
Impact 1
Contributions to the mitigation of climate change
By promoting community development rooted
in the local production for local consumptionof clean energy, such as hydrogen, we are
significantly reducing CO2 emissions and(Photo credit: Namie Town)
helping mitigate climate change.
Impact 2
Contributions to the circular economy
By developing technologies for reusing
batteries for large-scale power applications andproviding supply and demand adjustment
services for the power grid through our battery
center, we are contributing to the realization ofa circular economy.
Impact 3
Contributions to the development of local society and economy
By working together with residents todiscover what is truly needed in Namie andtackling individual problems through our
projects, we are bringing liveliness to Namieand assisting with its recovery from theGreat East Japan Earthquake.

(Photo credit: Namie Town)

Utilizing Capital

38

Our Efforts to Take on Social Issues— 2

Summit’s Initiative to
Achieve a Sustainable Society
Summit, the Sumitomo Corporation Group’s supermarket,
has defined its own management philosophy from Sumitomo’s
Business Philosophy as “work with all people surrounding
the company with sincerity.”
By ensuring the safety and security of the everyday food that
Summit offers, it aims to enrich the lives of people involved
with the company and help them fulfill their dreams, while atthe same time creating new values needed in today’s world
through cooperation with the Sumitomo Corporation Group.

Creating Businesses

Creating Value

Looking Ahead to the Future

39

Utilizing Capital

Summit’s Initiative to Achieve a Sustainable Society

Creating Businesses

Creating Value

Looking Ahead to the Future

Creating New Supermarkets Needed by Society
Summit, a supermarket that continues to
evolve with the local community

Redefined mission: “Sharing the source of life”—
going beyond providing foodSummit, operating 120 stores* in Tokyo, Kanagawa,In 2020, Summit announced its mid-term management

Chiba, and Saitama, has been committed toplan “GO GREEN 2022.”

community-based service since its first store opened in

employees, and also redefine its business to meet the
new needs of society, rather than simply being a place
to buy ingredients for meals.
After discussions among its employees, a new
mission was defined as “Sharing the source of life.”

With changes in society, such as lifestyle changes

Tokyo’s Setagaya Ward in 1963. Summit has grown toduring the COVID-19 pandemic and increased“Source” does not only refer to food, but also to

become one of the leading supermarkets in the Tokyoattention to the SDGs, the way people think about foodenergy and vitality, and this is what Summit aims tometropolitan area, with FY2020 consolidated sales

and what the world expects from it have changed

share with those who involved in Summit.

exceeding ¥300 billion for the first time in its history.

significantly. In response to those changes in values,“To make supermarkets in Japan enjoyable” is

Summit needed to rethink its meaning for theSummit’s business vision. The company has continued

community, customers, business partners, andPlease refer to Summit’s corporate website for more
information (in Japanese only).

WEB

to evolve by changing its product lineup, presentation
methods, and store designs in response to changes inpeople’s tastes, lifestyles, and competitive environment.

From offering ingredients for meals to “Sharing the source of life”

Beyond the boundaries of a supermarket, Summit also
regards contribution to the local community in various

Community inthe local areaor town

forms as an important part of its business. The
company operates “Summit no Mori” through tree
planting to help solve the shortage of forestry workers
in Tabayama Village in Yamanashi Prefecture, as well as“Summit Farm,” in which employees farm onabandoned farmland. In addition, the company values
its connections with local residents, such as sponsoring
the local professional soccer team, SFIDA Setagaya FC.
* As of April 30, 2022

A safe andcozy place
Means ofshopping undervariouscircumstances
Companionship forthe elderly

Health conscious

Society

Dietary education
for children

LivingFamily time

Family meals

Sharing onsocial media

Food

Nutrition &calorie control

Buying food

Celebratory meals
Drinkingand dining

Preventing illness
through healthyeating habits

Challenge toa new meal
New culinary
attempts

Feeling
full

Confronting
ecological andenvironmental
issuesCounseling for
those who arein need40

Utilizing Capital

Summit’s Initiative to Achieve a Sustainable Society

Creating Businesses

Creating Value

Looking Ahead to the Future

Employees Making It Their Own Mission

Initiatives at Summit Stores to Resolve Social Issues
The GO GREEN Challenge Declaration is an attempt made inimportance on its understanding and implementation in the2021 to explain to those outside Summit in an

workplace. The goal of this policy is to have the entire company

easy-to-understand manner how Summit will address social

share how our work contributes to resolving social issues, toand environmental issues. The declaration outlines key topics

develop a sense of empathy, and to respect each other.

of social issues to be addressed by the company, including

Details of the GO GREEN Challenge Declaration

To ensure that the declaration does not end up a mere

not only environmental issues but also contributions tophrase, employees discuss it thoroughly until they gain an

customers, local communities, and society, as well as making

understanding, and Summit places emphasis on the fact that

Summit a comfortable and rewarding place to work at for its

each of them must see it as their own business and act on it

employees. Summit has put this policy into practice and placesby putting it into practice.

Examples of Social Issues Resolved by Employees Who Took the Initiative

Employees come up with ideas forresolving social issues

Selling vegetables grown in-store

In-store promotions for learning and fun

Using a vegetable growing unit developed by the German

Summit plans programs that allow parents and children to

At each store, employees themselves come up withcompany Infarm, Summit offers fresh vegetables grownlearn about environmental issues while enjoying theideas for a wide variety of initiatives. Moreover,in-store and vegetables delivered directly from farmers

experience together. Summit also supports the healthy

by utilizing tools such as in-house social media,

in the neighborhood, resulting in a reduction of thedevelopment of children, who will lead the next

information is actively shared among stores.

environmental impact from logistics.

generation, through store tours and work experience
programs for elementary and junior high school students.

41

Summit’s Initiative to Achieve a Sustainable Society

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

Synergy from Collaboration with Sumitomo Corporation Group Companies

Creating New Value Needed Today
Summit aims to grow and create value together with Sumitomo Corporation Group companies while maximizing
the strengths of the Group, which has many companies within that have close relationships with consumers.

Collaboration with Tomod’s
from the Perspective of Food and Health

Collaboration with Tomra Japan from the Perspective ofResource Recycling

Summit has opened the Health Community Corner (Ken-komi) in
its stores in collaboration with Sumitomo Corporation, Tomod’s,
which operates a prescription pharmacy chain mainly in theTokyo metropolitan area, and Sunflower Project, led by Kokubu
Group. The Health Community Corner features a measuring
equipment and national registered dietitians who give dietaryadvice based on the results of the measurements, making thestore a community place beyond the confines of a supermarket,
providing a place where people can casually drop by.

Summit has installed Tomra Japan’s reverse vending
machines at some of its stores to collect disposed PET
bottles. By using machines to sort, compress, and recycle
bottles after collection while considering theenvironmental impact of logistics, Summit is contributing
to the establishment of a “bottle-to-bottle” recycling
system. Customers will be able to proactively contribute toresolving environmental problems by participating in therecycling system established by Summit and Tomra Japan.

Utilizing Digital Transformation from the Perspective ofFood Loss Reduction

Collaboration in the Real Estate Business from the Perspective ofConvenient and Comfortable Living

By integrating AI and other digital technologies into a richarray of internal and external data such as product and store
information, days of the week, and temperatures obtained
from Summit’s business infrastructure, it is possible to makeadvanced forecasts for demand. This enables Summit tocontrol the number of products purchased, the amount of
production, and the timing of discounts, with the aim ofeliminating food loss and other waste.

Summit provides more convenient and comfortable living
through the Terrace Mall series of large-scale commercial
facilities jointly developed and operated by Sumitomo
Corporation and Sumisho Urban Development, and byadding Summit and Tomod’s to the condominiums under
Sumitomo Corporation’s Classy House housing project,
thereby functioning as a supermarket and pharmacy.

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Utilizing Capital

Summit’s Initiative to Achieve a Sustainable Society

Creating Businesses

Creating Value

Looking Ahead to the Future

Resolving Key Social Issues for Sumitomo Corporation Group

Impact of Summit’s Initiatives
Summit’s activities based on the GO GREEN Challenge Declaration are also linked to the resolution of key social issues that Sumitomo Corporation has identified.
Here, we introduce Summit’s social and environmental activities and their impact on the earth and society.

Impact 1

Impact 2

Impact 3

Contributions to Local Communities andEconomic Development

Contributions to the Circular Economy

Contributions to
Climate Change Mitigation

Summit is working to maintain and improve people’s
health and enrich their lives by providing safe and secure
food products.

Summit offers in-store collection (recycling of foodtrays/paper cartons), and is also implementing initiatives
such as using containers and shopping baskets madefrom recycled plastic bottle caps.

Summit makes energy-saving efforts by adopting
methods to keep cool air escaping fromrefrigerator/freezer equipment, which accounts for
50–60% of electricity consumption, and by switching to
LED lighting, which accounts for 10–20%.

Summit provides job opportunities and a fulfilling life
through job creation, human resources development for
employees, and experiential learning for children.

Summit reduces food loss through initiatives including
purchasing vegetables that are difficult to sell due toinsufficient quality for their shape and size from farmers
and using them in deli foods.

Summit is working on a reduction of CO2 emissions byinstalling solar power generation systems on the walls or
rooftops of some of its stores.

Special Dialogue
43

Utilizing Capital

Roundtable Talk among Young Employees

Creating Businesses

Creating Value

Looking Ahead to the Future

Future of the Sumitomo Corporation Group“Future Conference,” shaping the Sumitomo Corporation Group 20 to 30 years into the future
A roundtable talk was held for young employees to discuss the theme “Thinking about the future of the Sumitomo Corporation Group in 2050.”
Drawing on their current work, they talked about their ideas for resolving social issues, what they hope to achieve at the Sumitomo Corporation Group,and their visions for the future of the Sumitomo Corporation Group and for themselves.

Okura Yoshiyama

Kazuma Fujita

Aya Ishida

Asia & Oceania Team,
Agri-Inputs & Services Dept.

Europe and Africa Telecom Business Team No. 1,
Smart Infrastructure Business Dept. No. 2

Chief Pharmacist, Pharmacy Dept.
Tomod’s44

Utilizing Capital

Roundtable Talk among Young Employees

Creating Businesses

What do you see as the creation of “prosperity” thatyou experience personally through your daily work?

telecommunications business, our aim is for this to lead to

Fujita: I am currently working on setting up

than one million new jobs, including both direct and indirect

telecommunications business in Ethiopia. The Ethiopian

employment, will be created through this project.

government announced a policy in 2018 allowing foreign

Ishida: Last fiscal year, I was assigned to work as ainvestment in telecommunications business. Following apharmacist at Tomod’s, providing dispensing services andtender process, Sumitomo Corporation was part of a

medication counseling to patients. Every day, I felt like I was

consortium that was awarded a license to operate amaking a difference to each and every patient. Furthermore,

telecommunications business in Ethiopia, and preparations

since Tomod’s was one of the first to offer free PCR testing

are currently underway for the launch of services. I recognize

and antigen testing in response to COVID-19, I thought thatthat the creation of prosperity through thisTomod’s was also creating prosperity in terms community

telecommunications business is just the first step. Beyond

contribution. Now, I am working at Tomod’s headquarters.

that there is the digitalization of healthcare, agriculture,

Drawing on the experiences and insights I gained last fiscal

education, and other sectors based on telecommunications

year, as I go about my work, I am thinking about what

infrastructure, and by succeeding in setting up successful

society needs from drugstores and dispensing pharmacies

Creating Value

Looking Ahead to the Future

the creation of even greater prosperity. We expect that more

Telecommunications business in Ethiopia: Leveraging its telecommunications
business expertise built up in Mongolia and Myanmar, Sumitomo
Corporation is partnering with the Vodafone Group to enter the Ethiopian
market. Services are scheduled to launch in 2022.

and about what those services can provide for theenrichment of society. Recently, I have also been working as aleader for a project providing medication counseling to
COVID-19-positive patients who visited hospital in the middleof the night and delivering medication to the patients thatsame day.
Yoshiyama: I work in the Agri-Inputs & Services Department
and am involved in the agricultural inputs and services

Tomod’s: Founded in 1993. A chain of drugstores with dispensing function,
currently operating 235 stores (as of August 2022), primarily in the Tokyo
metropolitan area. Its aim is to be a “family drugstore” that serves the healthand well-being of people in the community.

business in Japan. One of the more memorable moments atwork was when China imposed export restrictions on
fertilizers in October 2021. At the time, I was in charge ofprocuring raw materials for fertilizers mainly from China, andI immediately negotiated with various other countries. I
managed to find another supplier, but now there was a
problem with the size of the transport ship, which meantthat we could not make the purchase on our own. In theend, I was able to find a partner in Japan and we were able
to successfully procure the fertilizer. Since the impact on
Japanese agriculture would have been significant if we had
failed to complete the purchase, I felt a tremendous sense ofAgri-Inputs & Services Department: In addition to importing, manufacturing,and selling fertilizers and other raw materials in Japan, China, Australia, andMalaysia, this department is also involved in the agricultural inputs andservices business, such as agrochemicals, fertilizers, and seeds, to farmers in
Romania, Ukraine, and Brazil.

45

Roundtable Talk among Young Employees

Utilizing Capital

Creating Businesses

accomplishment in putting the processes for procurement inYoshiyama: Since my student days, I have been involved inmotion, and I was very happy for the social contribution we

research and work on agriculture, and I am particularly aware

were able to make.

of issues related to the sustainability of food production. For

Creating Value

Looking Ahead to the Future

example, the raw material for phosphoric acid, which is
What social issues have you noticed in the courseof your work, and what are your thoughts on
resolving them?

essential for crop growth, is mined as phosphate ore, but

Fujita: There are still plenty of countries around the world

into the sea. As it takes an inordinate amount of time—more

like Ethiopia where there is inadequate telecommunications

than a million years—for the constituent elements that flow

infrastructure. On the other hand, in Africa, the developmentout into the sea to return to the mountains, it is not aof telecommunications infrastructure has allowed somesustainable cycle. However, at present, without the use ofcountries to leapfrog* others as digitization progresses at achemical fertilizers, it is not possible to feed the world’s

rapid pace. Since digitization also has a considerable impact

approximately 8 billion inhabitants, and if the populationon the improvement of educational standards and thecontinues to grow at its current rate, before long, the worldenrichment of people’s lives, I fully recognize the urgent need

may not be able to produce enough food. Before thisfor the improvement of telecommunications infrastructure inhappens, I would like to work on improving the sustainability

emerging countries.

of food production, including investing in technologies that

* Meaning that in emerging countries, where existing social infrastructure has not beendeveloped, new services spread rapidly, skipping ahead of the technological progress
made in developed countries

make effective use of organic fertilizers.

DX promotion system

Business
front lines

Issues/Ideas

Businessorganizations

Introductionof digitaltechnologies

Regionalorganizations

DX
CenterOpencollaboration

Partners
Start-up• CVC• Accelerator
programCollaboration

Tech company

SCSK
DX Center: An organization that gathers together internal and external
digital talent to accelerate the Sumitomo Corporation Group’s DX in close
collaboration with SCSK, a leading IT solution provider.

when this is spread on fields as fertilizer, about 80% is notabsorbed into the crops, and some of it flows from rivers out

Ishida: In the course of working at Tomod’s, I have been keenly
aware of the need to make medical care more efficient. For

such efforts?

example, since relatively small progress has been made in

Ishida: Yes, I believe that digitization will also lead to thedigitization of the healthcare industry, pharmacies are unable tospread and expansion of “personalized medicine,” providing

determine whether a prescription is appropriate or not because

the most efficacious medical care to individuals. For example,

it is often impossible to tell the details of the patient’s diagnosis

if personal genetic information can be registered andor the underlying test values from the prescription alone. While

managed on IC chips and a system can be developed tothere is growing awareness across the industry for digitization

provide medical care based on this information, then theissues such as data sharing, as a company operating in thequality and accuracy of communication between medical

healthcare business and aiming to be an integrated trading

professionals and patients will improve. In addition, sincecompany with strengths in digital solutions, I believe that thethere will no longer be any waste in the provision of

Sumitomo Corporation Group needs to take the lead in efforts

treatment and prescription of drugs, lower medical costs canto promote digital transformation (DX).

also be expected.

Fujita: In terms of healthcare, I am looking forward to a time
information and their symptoms will be provided just by

What is your own future vision for the Sumitomo
Corporation Group in 2050?

doing a full-body scan. Do you see progress being made in

Fujita: Based on my previous experience working in thewhen medicines that are suited to a person’s genetic

46

Roundtable Talk among Young Employees

Utilizing Capital

Creating Businesses

Creating Value

Looking Ahead to the Future

Metal Products Business Unit and my current experience

regardless of the field. At the same time, on a personal level,

how the octopus catch had increased thanks to technicalworking in the development of telecommunications

I would like to continue taking on the challenge of creating

assistance from a Japanese company and about how ainfrastructure, I feel that the Sumitomo Corporation Groupnew business in the agricultural sector, and in the future, I

Japanese trading company was exporting the octopus tomust continue to be a business operator. While businesshope to raise our Group’s profile to the point where it can be

Japan, and I was reminded once again of the amazing power

operations come in many different forms, the days of simply

said that the Group is taking leadership in the industry andof the private-sector business. As for the development ofinvesting money and expecting to earn a large return are

driving improvements in the value of agricultural products

telecommunications infrastructure in Ethiopia, in which I amlong gone. I believe it is important for the Group itself to be

and greater efficiencies in farm work.

currently involved, I feel that with its proven track record inplaces such as Mongolia and Myanmar, our Group is best

heavily involved in the operation of business in order toWhat challenges can the Sumitomo Corporation Grouptackle that will lead to a better future?

positioned to bring this project to fruition. I hope to continue

the community.
Ishida: I agree with Fujita-san. I also believe that a greater

Yoshiyama: At the moment, I want to get out into the

Corporation Group, as a trading company, can tackle, andemphasis should be placed on business operations. In thisfield and experience firsthand the relevant issues faced byaccelerate the creation of value in regions in line with theirregard, professional expertise is absolutely essential for

individuals and communities as I go about my work. I don’t

specific growth phase.

business operations in healthcare. I have expertise as athink this approach will change as I get older and gain more

Ishida: Thinking about healthcare from the perspective

pharmacist, but as we expand the healthcare business,experience. I’m sure that my role will change and new

mentioned by Fujita-san of “challenges that only thethere are also times when I recognize the importance of atechnologies and systems will emerge, but no matter thephysician. For this reason, I feel we need to expand thesituation, I hope to always be working on the front lines forrecruitment of specialists. I also believe that the addition of

the resolution of social issues. Also, in April 2022, a newdiverse professionals to the Group will help promote D&I and

Agri-Innovation Department was established within our

will enhance our organizational strength and competitiveness.

Mineral Resources, Energy, Chemical & Electronics BusinessYoshiyama: In order for our Group to continue growing,

Unit. Since this new department will make medium- toI believe it is important for us to pioneer new business,long-term investments in food and agriculture, I expect that

improve business value and achieve contributions tofuture-oriented business activities will increase.
Ishida: I want to build a business model for the future thatis not bound by existing limitations and which meetsanticipated needs. Particularly with regard to personalized
medicine, while society as a whole needs to promote it, thereis the issue of who will take the lead. I think that, if theSumitomo Corporation Group can take a leading role, it willlead to the resolution of social issues, and as an individual
who has long been involved in healthcare, I will gain a great
sense of achievement or satisfaction.
0 1 Challenge: An internal entrepreneurial program in which the Sumitomo
Corporation Group encourages the realization of new business ideas conceived byindividual employees in the field. (123 applications in FY2021)

Fujita: I am of the same opinion as Ishida-san, and would liketo stay one step ahead of the needs of the times. When I
visited Mauritania in Africa in my student days, I heard about

taking on new challenges that only the Sumitomo

47

Utilizing Capital

Roundtable Talk among Young Employees

Creating Businesses

Sumitomo Corporation Group can tackle,” I feel that we

2050. Although there is a shared understanding that bothshould aim to provide total solutions that include prevention.

society and companies must change, I am worried that

Compared to specialized healthcare companies, since ourchange will take time. On the other hand, even now as weGroup has an advantage in business diversity, I think we cantry to run toward to change, I am hopeful that I will have themake a contribution to health maintenance, prevention, andopportunity to lead the change as I transition from a young

treatment in all life stages by partnering with departments on

employee to a mid-level employee with more discretion andfood, pharmaceuticals, digital, etc.

more responsibility.
Yoshiyama: My outlook for 2050 is positive. Although

To yonugsters, do you have hope for 2050?

there are many social issues that need to be resolved, as

Ishida: I have feelings of both hope and trepidation about

technology evolves, new solutions are emerging. I am excitedabout the possibility of utilizing new technologies to resolve
major social issues in the future.
Fujita: I am also basically hopeful for 2050. Going forward,
the perspective of resolving social issues will become
increasingly important in business activities, and I think will
lay the foundation for companies that are doing the rightthing and doing something new for that purpose to berecognized fairly. As a consequence, I think that the
reputation of the Sumitomo Corporation Group will beenhanced further as we have been faithfully promoting
sustainability management for some time.

Sustainability management: Perfect alignment of a sustainable society with
the Group’s value creation and sustainable growth

Creating Value

Looking Ahead to the Future

Global Voice
Sumitomo Corporation Vietnam employee talks about
her passion for the project to resolve social issues.
Do Thi Thu Huong
Hanoi Social & Transport
Infrastructure Department,
Sumitomo Corporation Vietnam LLC

Building a Smart City for the
next 30 years and beyond
The North Hanoi Smart City (NHSC) project has beendeveloped with a total area of 272 ha in Northern Hanoi
by Sumitomo Corporation and the BRG Group*. I am
currently in charge of the Smart Community Hub (at theproof of concept stage) in Hanoi City, which is a part ofSmart Services in NHSC. The core spirit of the project is toresolve several social issues in Vietnam arising due to therecent rapid urbanization, such as the contaminatedenvironment, lifestyle disease, lack of community spaceand connectivity, lack of health awareness, lack of ahealthy environment for child-raising. Even though theissues are complicated, our cutting-edge six smart
solutions—smart living, smart learning, smart mobility,
smart energy, smart economy, and smart government—
will make it happen to tackle them. Now,
I am thrilled to see that my contribution and devotion will
be realized in a real and unique Smart City where
everyone feels proud to live or work for the next 30
years. I even feel blessed to be able to witness community
strength to attract the co-collaboration among investors,
companies, organizations, residents, and even visitors tobuild up a real sustainable Smart City. Ultimately, we shallrealize a most civilized and vibrant city in Vietnam forourselves and for our children’s generation.
* BRG Group: A leading conglomerate in Vietnam involved in a wide range ofactivities in finance, real estate, retail, pharmaceuticals, import and export, etc.