Taking on the challenge of carbon neutrality and a circular economy
with the concerted strength of the Toyoda Gosei Group

Environment

Global warming, resource depletion due to mass production and disposal, and waste problems have become
shared issues worldwide. Under our slogan of “A Greener, Richer World for Our Children,” Toyoda Gosei isaccelerating its efforts by bringing together the entire Group to realize carbon neutrality and a circular economy
as soon as possible by maximizing its strengths in rubber and plastic polymer technologies in both production
and products.

Contributing to Environmental Preservation through All Our Business Activities
Basic Philosophy
The Toyoda Gosei Group formulated its 1st
Environmental Action Plan in 1993 based on its
Environmental Policy, and since that time has been
actively confronting environmental issues. In February
2016, we announced our long-term targets in theTG2050 Environmental Challenge, and have set
milestone targets to be reached by 2030. We have also
formulated a 5-year action plan in which activity items
and targets are set and are carrying out activities to

1. Environmentally-friendly
business activities

Environmental
PolicyWe are keenly aware that all stages of ourbusiness relate deeply to the environment,from development, production, and sales to
end-of-life disposal. The Toyoda Gosei Group,
including all internal departments, domestic
and international affiliates, and suppliers,
conducts all business activities with concern
for the environment in cooperation andcoordination with customers, government
authorities, and others.

preserve the environment.
Globally, we have placed integrated environmental
functions in the regions of the Americas, China,
ASEAN, and India. The Group is also making efforts as
a whole with area control in five global regions, theabove four plus Europe/South Africa. These efforts are
made in conjunction with government agencies,
customers, and suppliers.

2. Good corporate citizenship

3. While spreading
information on these
initiatives, we listen to theopinions of people at alllevels of society and work
to improve our initiatives
wherever we can.

As a good corporate citizen, we participate
in, support, and cooperate withenvironmental activities by many groups
while also working on environmental
activities in the community and broader
society. We also provide education for all
employees to support them in becoming
involved in environmental activities as
members of the community and society,and support social contributions andvolunteerism.

TG2050 Environmental Challenge
The Toyoda Gosei Group specializes in the field of
rubber and plastic polymers. Our symbol is thebenzene ring, a hexagonal hydrocarbon structure thatis the starting point for polymers. Borrowing from thesix sides of the benzene ring, the TG2050
Environmental Challenge sets six challenges tostrengthen our environmental efforts with a long-term
TG2050 Environmental Challenge(6 Challenges)

Medium- to Long-Term Scenarios for Achieving
the TG2050 Environmental Challenge

Products
and technology

Recyclingoriented society

Contribute to an
environmentally-friendly
society through polymer
and LEDtechnology

Minimize water risks andimprove wastewater
quality

Environmental
management
Foster an environmentally
responsible corporate
culture andemployees• Global consolidated target management• Water use reductions(27.5% decrease vs. 2019)• Start of plant afforestation

Decarbonizedsociety

Strengthen and expand
environmental protection
and preservation
activities

Scopes 1, 2, and 3
Carbon neutrality

Scopes 1 and 2
Carbon neutrality
Scope3

Greater reduction of 6 gases
Enhanced initiatives for coexistence with nature

Environmental
preservation andliving with nature

Recyclingoriented society

54

Global enhancement

Cut plant CO2 to zeroand utilize renewableenergyMinimize waste andcreate resource
recycling systems

view to the year 2050.
As a roadmap to achieve this goal, in August 2023, wemoved up the date from 2050 to 2030 for achievingcarbon neutrality (Scopes 1 and 2), which will
strengthen our response to climate change issues, andwe have also prepared an environmental action plan
as a five-year plan to guide our efforts.

Achieving
the TG2050
Environmental
Challenge

Initiatives for decarbonized society

Full-fledged startof environmental
initiatives• Adoption of renewable energy• Completion of conversion to LED lighting• Enhanced improvements in production
technology• Establishment of energy conservation
improvement team• Management system
consolidation• Legal compliance• Waste reduction• CO2 reduction
targets• ISO acquisition
at main plants

2030
Milestones
7th

1st

5th

1993

2015

6th

Action Plan
Action Plan
Action Plan
Environmental Action Plan (5-year plans)

2020

Announced in August 2023
(Setting of new targets)Action Plan
Announced in April 2021

2025

2030

2050

About Toyoda Gosei

Value Creation Story

Value Creation Strategy

Environmental Organization
Our medium- to long-term policy and key action items
are discussed and decided in a Carbon Neutrality andEnvironmental Committee chaired by the company
president. The Carbon Neutrality and Environmental
Committee consists of three subcommittees in theareas of products, production, and quality. In the areaof production, a Production and Environment
Subgroup has been established to strengthen
environmental initiatives over the entire manufacturing
process. The above subcommittees are further broken
down into working groups that implement and manage

Foundation of Value Creation

Data

areas such as reductions in energy use and waste
products, and preservation of the environment. In thisway, environmental preservation and management
activities are conducted from an expert perspective.
Also, liaison meetings have been established as aforum for information sharing with domestic andoverseas Group companies. A carbon neutrality
project was started in FY2021 to accelerate efforts
over the entire product lifecycle. The project is headedby the president with outside directors as advisers andthe general managers of related divisions as members.

Environmental Organizational Structure
Carbon Neutrality
and Environmental
Committee*

CarbonNeutrality
Project

Products(meets twice/year)(Chairperson: Company president)
Discussion of mattersrequiring medium- tolong-term management
decisions

Formulation of mediumto long-term targets anddiscussion of measuresand issues to achievethem

Production andEnvironment Subgroup
Production

Liaison Committee for Environmental
Communication with Domestic
Affiliates (meets twice/year)

Products and Technology Environment
Subcommittee (meets as needed)(meets twice/year)
Discussion of specific measuresand issues to achieve short- to
medium-term goals

Quality AssuranceManages, guides, andsupports coordinatedenvironmental efforts bydomestic affiliates

Implements and manages development of environmentallyfriendly products and technologies

Production Environment Subcommittee(meets twice/year)

Liaison Committee for Environmental
Communication with Overseas
Affiliates (meets once/month)

Implements and manages policies and technical development
measures for reduced emissions from production processes

Subcommittee on Systems for SOC Regulations
and Quality Assurance (meets as needed)

Manages, guides, andsupports coordinatedenvironmental efforts byoverseas affiliates

Develops systems for compliance with SOC regulations
and for quality control* The Carbon Neutrality and Environmental Committee is positioned within the organization as shown in the Corporate Governance System Chart (see p. 71), and the deployment of policies from the Carbon Neutrality and Environmental
Committee, the Production and Environment Subgroup, and the respective subcommittees to plants and other operations is done by establishing expert committees in accordance with the ISO 14001 system at each plant.

Strategy on Carbon Neutrality and Circular Economy
We have established a strategy on carbon neutrality
and circular economy for the entire product lifecycle
and are implementing initiatives for achieving it. We
have set Sustainable Materials, Sustainable Design,
Zero Emission Challenge, and Resource Circulation as
our goals, and have incorporated them into specificcontent from four perspectives, and in this way, we
aim to realize carbon neutrality and a circular economy
and link it to viable businesses.
Materials

We will strive to procure recycled materials for also ensuring
stable supply and expand the use of bio-materials.

DesignWe will strive to develop lightweight designs, easilydisassembled designs, compact designs, and otherimprovements.

Manufacturing In addition to day-to-day improvements, we will also study
the adoption of innovative processes, such as process
downsizing and reduction of heat energy, as well as theuse of hydrogen.

Strategy on Carbon Neutrality and Circular Economy

Sustainable
Materials

Materials
Resource
Circulation

Collection
andrecycling

DesignSustainable
DesignManufacturing

Zero Emission
Challenge

Collection/ We will systematically minimize waste in our plants andrecycling build a system to collect parts from the market.

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55

Environment

Building a Decarbonized Society
Basic Philosophy
In order to achieve the Paris Agreement’s goal of
limiting the global average temperature increase to
1.5°C above pre-industrial levels, greenhouse gas
emissions must be reduced to virtually zero by 2050.
At Toyoda Gosei, we are aiming to achieve thedecarbonized society set forth in the TG2050
Environmental Challenge by working throughout ourvalue chain to set targets for CO2 emissions generated
from our own production operations in 2030 (Scopes 1
and 2) and from the procurement of materials andparts (Scope 3).

Endorsement of TCFD Recommendations
In May 2019, we expressed our endorsement of therecommendations of the Task Force on Climate-related
Financial Disclosures (TCFD) and conducted ascenario analysis of risks, opportunities, andresponses based on the Guide. We are accelerating
our efforts across our business activities andproactively disclosing relevant information, including
incorporating the results in our 2030 Business Planand reviewing our TG2050 Environmental Challenge
and 2030 milestones.

Carbon Neutrality Project
We are conducting initiatives to reduce CO2 emissions
throughout the entire lifecycle of our products, fromprocurement of materials and parts to productdevelopment, production, use, and disposal.

SystemWith the president at the top, the project leader is thevice president, and the core members consist of
department heads and above. This is a system thatenables speedy and immediate managerial decisions
and their implementation.

Initiative

Each task is led by the head of the relevant department
to carry out the initiative.

Moved up the Timetable for Carbon Neutrality to 2030
Toyoda Gosei has established a new target to achievecarbon neutrality for CO2 emissions (Scopes 1 and 2)
generated from its production operations that is 20
years earlier than the previous target by moving it up
from 2050 to 2030. This is a significantly shorter timeframe for achieving carbon neutrality that reflects our
responsibility as a company to contribute to solving
climate change risks that are becoming more serious
in various parts of the world. We will continue to
implement initiatives to become a leading company inthe environmental field.

56

Task A
Understand productlifecycle assessment(LCA) and set
reduction targets

Task B Visualization of CO 2 emissions and reductions
 Target setting items(1) Establishment of medium- tolong-term targets(2050, 2030, and 2025)(2) Subdivision of targets by category(Scope 3)(3) Setting of targets by theme

Achievingcarbon neutrality

Task C
Share carbon
neutrality (CN)relatedinformation

Prepare andimplement
reduction
scenarios
 Strategic reduction approach, identification of vantage points
 Development of scenarios (mainstays of major initiatives) Identification of action themes to achieve scenarios
 Definition of environmental investments, clarification of financial
impact, and budgeting

 Gathering and sharing information on IR Gathering and sharing information on
government, customers, JAPIA, etc.

Initiatives to Achieve Carbon Neutrality
CO2 emissions Day-to-day
improvements
Develop decorative techniques that
reduce environmental impact during
the painting and plating processes

Other
areas
Painting/
plating
Rubberextrusion
molding
Plastic
injection
molding

Optimize vulcanization
conditions for rubber
molding process

Production
technology
innovation

Implement electrification
and reduce pressureduring the plastic
molding process

Go beyond day-to-day
improvements and develop
production technology
innovations to accelerateenergy conservation

Renewableenergy utilization

2030

2050

Achieve Scopes 1 and 2
carbon neutrality

2030

2050

Scopes 1
and 2

Carbon neutrality

Carbon neutrality

Scope 3

27.5% reduction
compared to 2019

Carbon neutrality

About Toyoda Gosei

Value Creation Story

Value Creation Strategy

Foundation of Value Creation

Data

Reducing CO2 Emissions
To achieve our 2030 target, we are reducing CO2 emissions throughout the entire product lifecycle by improving
productivity and efficiency of logistics, in addition to more lightweight designs for products leading to even higher
vehicle fuel efficiency.
Product Development Stage: Environmentally-Friendly Product Development Materials Design
In the product development stage, we are making
or rubber to plastic), reduce the number ofheadway in providing products for environmentallycomponents, integrate functions, and use morefriendly, next-generation vehicles and developing
lightweight designs while ensuring quality for the
products with lighter weight for greater fuel efficiency
strength and other properties of instrument panel
and lower energy consumption and CO2 emissions
peripherals and other interior and exterior components
across the areas of materials technology, productand of functional parts such as hoses. We are also
design, and production technology. Examples include
actively working with suppliers to develop materials
the development of high-pressure hydrogen tanks forwith low CO2 emissions, such as bio-materials andrecycled materials.
FCEVs and efforts to switch materials (e.g., from metal
Production Stage: Emission Reduction through Development of New Manufacturing Methods and Day-to-Day
Improvements Manufacturing
We have set a 2030 milestone for achieving zero CO2
of utilities, expansion of renewable energy, and more.
emissions at our plants, and are working to achieve
In particular, renewable energy initiatives are underway
this goal through day-to-day improvements at plants,
with the goal of converting all electricity to renewable
innovations in production technology, higher efficiency
energy by FY2030.
Logistics Stage: Improving Loading Efficiency
DesignMaterials and Parts Procurement Stage: Emission
Reduction through Collaboration with Suppliers

Manufacturing

Materials Manufacturing

In collaboration with logistics companies, we are
reducing CO2 emissions by improving truck loading
capacity and logistics efficiency through the use of AI
and other means.
Initiatives to Reduce CO2 Emissions in the Value Chain

We implement CO2 reduction by sharing goodpractices with suppliers through the Energy Saving
Dojo and supporting actual data measurements.
Toward Carbon Neutrality in the Value Chain by 2050

Product Lifecycle
Procurement of materials and parts

Scope 3*1

Procurement ofmaterials and parts

Transport

Initiatives
Minimizing CO 2 emissions Reducing CO 2 emissions
from materials and parts from logistics
In collaboration with material
manufacturers

In collaboration with logistics
companies Development and utilization of Improved loading efficiency andrecycled materials and bio-materials
operating route efficiency
 Adoption of electrically powered
In collaboration with parts
trucksmanufacturers

Our company (manufacturing)

Use and disposal (recycling)

Scope 1*2, Scope 2*3

Scope 3

Commuting andbusiness travel

Parts manufacturing

Minimizing CO 2 emissions
from commuting andbusiness trips

Achieving zero CO 2
emissions from plants

Minimizing CO 2 emissions
at the usage stage

 Day-to-day improvements: Comprehensive
energy-saving initiatives
 Utility updates: Higher equipment efficiency
 Innovations in production technology:
Development of innovative manufacturingmethods
 Adoption of renewable energy:
Installation of solar panels, purchaseof green electricity

 More lightweight products Development of products for BEVs and FCEVs
 Development of technology for power devices

 Promote use of BEVs and FCEVs
 Encourage web conferencing
and telecommuting

 Reduction of CO 2 emissions

Transport

Use

Disposal

Minimization of waste Easily-disassembled designs
 Collection of waste materials andimplementation of recycling*1 GHG emissions in the supply chain indirectly emitted by the company (e.g., raw material production, transportation, business trips, commuting) *2 GHG emissions directly emitted by the company itself (e.g., fossil fuels, natural gas)
*3 GHG emissions indirectly emitted by the company (e.g., purchased electricity)

Reduction of Greenhouse Gas (6 gases)*4 Emissions
Of the six greenhouse gases, Toyoda Gosei uses three(HFC, PFC, SF6) and is conducting initiatives to reduce
all of them. By FY2015, we had completed a switch toalternative gases with a low environmental impact forthe shield gas and other gases used in the productionof steering wheel cores. We will continue these
reduction initiatives going forward.
*4 Hydrofluorocarbon (HFC), perfluorocarbon (PFC), sulfur hexafluoride(SF6), methane (CH4), nitrous oxide (N2O), nitrogen trifluoride (NF3)

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57

Environment

Building a Recycling-Oriented Society
Basic Philosophy
In order to mitigate resource depletion and water risks,
we not only take measures for defects and yield, which
are the focus of our manufacturing divisions, but also
work on emission control and recycling involving
material and production technologies in the sourcing
divisions for contributing to the attainment of arecycling-oriented society. For water, we identify risks
in each country and region where we conduct businessglobally while also striving to reduce risks by reducing
water usage, recycling water, and returning cleaner
wastewater to the community.

Risks and Opportunities Related to Resource Recycling
We consider risks and opportunities related to resource recycling as important management issues, and we areworking on them company-wide as one of our priority issues to be addressed.
Issue

Risks

Opportunities

Response

Resource
depletion(shortage)• Improved earnings through recycling
technology and reduced material usage• Reduced earnings and production
volumehindered by difficulty in procurement of raw• Improved corporate value throughmaterials and price hikes
development of the above-mentioned
technologies• Development of more lightweight products• Development of recycling technology for
raw materials• Expanding the use of plant-derived
biomaterials and recycled materials

Water risk(quantity andquality)• Improved earnings through reuse of water• Production hindered by difficulty inand reduced water usage
securing water necessary for production• Drop in product quality due to deterioration • Improved corporate value throughdevelopment of the above-mentioned
in water quality
technologies• Production hindered by water damage• Development of water reuse technology• Expanding the use of rainwater• Review of production system andinstallation locations of electrical facilities

Waste Reduction
Establishment of 2030 Milestones

Development of Product Recycling Technology

We are working to effectively use resources such as bycurbing emissions, source measures, reducing wastes
by recycling rubber and plastic chips, and reducing
wastes by thoroughly sorting them.

Scenario for Minimizing Amount of Waste(Waste Reduction Diagram) [Non-consolidated]
Day-to-day
improvements
Percentage of waste

Post-occurrence
measures2030 Target
2025 Target line: Targets forthe 7th Environmental Action Plan

50% reduction(Compared to FY2012)

40% reduction(compared to FY2012)

Manufacturingmethod development
Recycling(including developmentof recycled products)

0
2012

2017

2020

2025

2030

2040

DesignManufacturing Collection/recycling

Technology Development for Recycling ELV* Parts

(%)

100

60
50

Materials

We develop and design easily recyclable products andmaterials by taking into consideration the entire
lifecycle of automobiles. We are also developing
recycling technology for waste material.

2050 (FY)TG2050 Environmental Challenge Minimization

Key item

Measures implemented

New recycling• Composite material separation technology• New recycling technology (high-quality material
recycling)

Use of recycledmaterials in
vehicles• ELV parts recycling technology• Development of uses for recycled materials

Design of easilyrecyclable products• Product design for easy dismantling• Materials and composition changes for easy
recycling* ELV: End of Life Vehicle

58About Toyoda Gosei

Value Creation Story

Reduction of Waste Materials in the Production Stage
Manufacturing Collection/recycling

In 2018, we launched the Waste Reduction Project toimplement source measures and recycling initiatives.
At each plant, we are conducting inspections for all
types of waste to identify items for reducing waste byusing the genchi-genbutsu system (collecting facts
and data at the actual site of the work or problem) to
implement waste reductions. We also share examplesof waste reduction with both domestic andinternational Group companies to implement waste
reduction throughout the entire Group.
Reducing Water Risks Manufacturing
Establishment of 2030 Milestones
We are assessing risks in both water usage and water
quality in Japan and international locations, andmaking improvements at high-risk locations. Even inlocations where risks are low, we are trying to reducewater intake amounts for the effective use ofresources.
Since FY2021, we have been working to reduce water
use by reducing leakage and implementing wider
recycling.

Value Creation Strategy

Foundation of Value Creation

Data

Reduction of Packaging Materials in theDistribution Stage Collection/recycling
By washing returnable boxes* more frequently andkeeping them clean, we are reducing the amount of
packaging materials used to prevent products frombeing soiled. We are also reducing packaging materials
by putting lids on returnable boxes and making otherchanges while maintaining a balance between ensuring
product quality and reducing the amount of packaging
materials used.
* Boxes for transporting products

We are also working to systematically upgrade ourwastewater treatment facilities to produce evencleaner wastewater.
2030 Milestones for Water Risk Reduction [Global]
Item

FY2030 Target

Water quality

Measures completed
at four locations

Water intake

Measures completed
at seven locations

Water intake per sales
unit

11% decrease vs.
FY2019High risk area

Low risk area

Building Environmentally-Friendly Societies
Basic Philosophy
Based on the concept of Nature Positive, we have set
coexistence with local communities as one of thematerialities (key issues) in our efforts to build nature

coexistence initiatives to conserve biodiversity, andare working on woodlands creation, building of
biotopes, and conservation initiatives for tidal flats.

Risks and Opportunities Related to Biodiversity

Establishment of Medium- to Long-Term Targets

We conduct initiatives by identifying risks andopportunities related to biodiversity.

We have set a “No Net Loss of Greenery” goal ofrestoring 59 hectares of greenery by 2050, which isequivalent to the area of our plants, and are
conducting initiatives to achieve this goal. Specifically,
under the slogan “Connecting Activities with Water,
the Source of Life,” we are conducting initiatives in theareas of mountains, rivers, and oceans.

Issue

Risks

Opportunities

Response• Reduced earnings • Business continuity by • Development ofand production
securing human
more lightweighthindered byresources and raw
products
difficulty inmaterials through• Development ofprocurement of
nature conservation
recyclingraw materials and initiatives
technology for
Reduction price hikes• Sustainable production raw materialsof natural• Drop in productand enhancement of • Expanding thecapitalquality due tocorporate value by
use of plantdeterioration insecuring good quality
derivedwater quality
water resourcesbiomaterials andthrough woodlands
recycled materials
creation and riverconservation

Scenario for Attaining Targets
0

2010

2020

2030

2050 target
02040

2050 (FY)

-10
-20
-30

-36.0
2022 results-49.0
2021 results-50 2010 results -51.0
2025 target
-45.0
-59.0
-40

-60

2030 target• Tree planting• Woodlands creation• Use of abandoned• Solar power generation
farmland• Elimination of invasive• Building of biotopes
alien species• Overseas conservation
initiatives, and more-70
ha (lost greenery area)

Woodlands creation by employees and their families

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