IHI Group’s ESG Management
November 9, 2021

Hiroshi Ide, President and Chief Executive Officer

Contents

1. IHI Group’s ESG Management
2. Tackling Climate Change
3. Transitioning to a Carbon-Neutral Economy
4. Upholding Human Rights
5. Building a Diverse and Inclusive Workforce

IHI Group’s ESG Management

Tackling Climate Change

Transitioning to a Carbon-Neutral Economy

Upholding Human Rights

Building a Diverse and Inclusive
Workforce

１．IHI Group’s ESG Management
Our Sustainability Vision“Create a World where
Nature and Technology Work in Unity”
IHI Group’s ESG Management

Materialize fulfilling lifestyles
Resolve socialissues
Prevent and mitigate
disasters

Become carbon-freeUphold human rights

We will help resolve social issues
through business to achieve asustainable, mutual growth for theIHI Group and society.

Build a diverse and inclusive workforce
Secure stakeholder trust

Management Philosophy“Contribute to the development of society
through technology”

Copyright © 2021 IHI Corporation All Rights Reserved.

“Human resources are our single mostvaluable asset”
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IHI Group’s ESG Management

Tackling Climate Change

Transitioning to a Carbon-Neutral Economy

Upholding Human Rights

Building a Diverse and Inclusive
Workforce

2. Tackling Climate Change
Cut CO2 emissions to achieve carbon neutrality■Through business operations■Through products and services

Cuts through production

Cuts through existingtechnologies• Adopt pioneering technologies• Fuel conversion• Use renewable energy• Enhance efficiency of existing facilities• Lighten and electrify products• Use renewable energy

Cuts through procurement

Cuts through newtechnologies• Partner with eco-friendly businesses

Transition

Transformation• Use hydrogen and ammonia• Recycle carbon

IHI Carbon-Neutral 2050
Our 2050 Ambition for a Carbon-Neutral Value Chain
Copyright © 2021 IHI Corporation All Rights Reserved.

4IHI Group’s ESG Management

Tackling Climate Change

Transitioning to a Carbon-Neutral
EconomyUpholding Human Rights

Building a Diverse and Inclusive
Workforce

3. Transitioning to a Carbon-Neutral Economy■Carbon neutrality through products and services

Transition

Boost existing power plant efficiency

Lighten and enhance heat resistance ofaviation parts• Leading operations through advanced maintenancetechnology• Biomass fuel conversion• Accelerate development of composite fan blades andceramic matrix composites technology• Participate from the conceptual design stage of nextgeneration engines

Power management systems employing
renewable energy• Adjust supply and demand for renewable electricity
employing storage batteries and energy
management systems

Low-pressure
turbine blade

Fan case

Ceramic Matrix Composites

Fan blade

Carbon fiber reinforced
composite materials

High-pressure
turbine blade*＊IHI currently engaged in joint research
for Japan Aerospace Exploration Agency’s“En-Core Project”, initiated in 2018 andrunning through 2023

Electric turbochargers

Energy Storage Management Systemprovided by IHI Terrasun Solutions Inc.

Copyright © 2021 IHI Corporation All Rights Reserved.

Mercedes-Benz AG GLC F-CELL
electric turbocharger
Source: IHI Corporation“ETC M” electric turbocharger
for fuel cell systems

5IHI Group’s ESG Management

Upholding HumanRights

Transitioning to a Carbon-NeutralEconomy

Tackling Climate Change

Building a Diverse and Inclusive
Workforce

3. Transitioning to a Carbon-Neutral Economy■Carbon neutrality through products and services

Transformation
From ammonia co-firing to ammonia
exclusive firing

Co-firing ammonia in boilers and gas
turbines

World’s first• Launch of ammonia
co-firingdemonstration
project at largecommercial powerplant• Attained liquidammonia co-firingratio of 70% on
calorific basis

Liquid ammonia and natural gas cofired 2,000-kilowatt-class gas turbine
at IHI’s Yokohama Works

Hekinan Thermal Power Station (Hekinan City,Aichi Prefecture), where the demonstration
project will be conducted © JERA

Ammonia value chain

Blue ammonia
Natural gas

RenewableenergyCarbon dioxide Capture& Storage/
Enhanced Oil Recovery

Electrolysis

Supply and demand optimization

Electricity
Boilers

Ammoniasynthesis
Green ammonia

NH3

NH3

Bunkeringterminal

Transportation

Gas turbines

NH3Receiving
terminal
Raw material

Industry

Fertilizer6Copyright © 2021 IHI Corporation All Rights Reserved.

IHI Group’s ESG Management

Tackling Climate Change

Transitioning to a Carbon-NeutralEconomy

Upholding Human Rights

Building a Diverse and InclusiveWorkforce

3. Transitioning to a Carbon-Neutral Economy■Carbon neutrality through products and services

Transformation

Carbon recycling

CO₂ separation andrecovery

Methanation
Fuel• Delivery of firstmethanation unit to Asahi
Group Research andDevelopment Center
Methanation unit
installed at facility ofAsahi Quality andInnovations, Ltd.

• Commissioned to undertake
research project for CO₂
separation and recovery atthermal power plants and forpipeline transportation

Carboncapture
andstorage

CO2
CO2 recovery(2) Assess impact on
CO2 sources

Synthesis(1) Assess CO2 separation
and recovery technologies

CO2 recovery facilities
Exhaustgas after
CO2
removalChimney

Electricity

Water

Chemical reaction of
CO2 and hydrogen (H2)

Denitration

BoilerSynthetic
methane
(CH4)

Water
electrolysis

Methanation unit

CO2 separation
and recovery

IHI-delivered equipment

Desulfurization

Dehydration /refining
equipment
Pumpingequipment

Exhaustgas

Steam

CO2 pipeline(3) Examination of CO2
aggregation technology

Overview of CO2 separation and recovery survey

Direct air capture• Capture of CO2 directly from atmosphereMethanation synthesis flow and IHI’s involvement
Copyright © 2021 IHI Corporation All Rights Reserved.

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IHI Group’s ESG Management

Tackling Climate Change

Transitioning to a Carbon-Neutral
EconomyUpholding Human Rights

Building a Diverse and Inclusive
Workforce

3. Transitioning to a Carbon-Neutral Economy■Carbon neutrality through products and services

Transformation

Tropical peatland*1 consulting• Aiming to commercialize tropicalpeatland consulting and high-quality
carbon credits*2 through a businessalliance with Sumitomo Forestry• Preventing peat fires, suppressing
CO2 emissions, and protecting
forests by monitoring and predicting
groundwater levels in tropicalpeatlands
Image of system for predicting groundwater levels*1 “Tropical peatland” refers to areas of land formed by the accumulation ofplant remains that have not decomposed in water.
*2 “Carbon credits” refer to tradable certificates for greenhouse gases emissions
reduction. When emissions are circulated between companies or countries, they
are traded as credits.

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Copyright © 2021 IHI Corporation All Rights Reserved.

IHI Group’s ESG Management

Tackling Climate Change

Transitioning to a Carbon-Neutral Economy

Upholding HumanRights

Building a Diverse and InclusiveWorkforce

4. Upholding Human Rights
The “IHI Group Human Rights Policy” was formulated to underpin our drive
to help resolve social issues.
Key human rights challenges••

Eliminate forced labor•

Eliminate child labor•

Provide equal opportunities•

Eliminate discrimination and harassment

Ensure safe and healthy workplaces for allemployees•

Respect basic rights of all employees

Strengthen supply chain management•

Undertake socially responsible procurement byengaging with and monitoring suppliers

Establish structure to integrate human rights risk management globallyCopyright © 2021 IHI Corporation All Rights Reserved.

9IHI Group’s ESG Management

Transitioning to a Carbon-Neutral Economy

Tackling Climate Change

Upholding Human Rights

Building a Diverse and Inclusive
Workforce

5. Building a Diverse and Inclusive Workforce
Material issue• Acquire diverse and talented personnel• Enhance employee motivation and engagement• Integrate different values, experiences, and expertise

Create a conducive work environment• Share aspirations through direct dialogue with seniormanagement and other means• Foster attribute, skill, and task diversity
・ Second jobs
・ In-house side job program・ Smart Work (new work practices)

Results presentation
for in-house side job
programIn-houseside job

Direct dialogue with senior management

Strengthen globally applied frameworks and programs
Copyright © 2021 IHI Corporation All Rights Reserved.

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“Create a World where
Nature and Technology Work in Unity”