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Green Value Chain Platformの中のEnglishの中のLearn more about impacts and adaptation in Japan's industry sectors
Learn more about impacts and adaptation in Japan's industry sectors
1. Supply chain emissions
2. Domestic and international trends related to greenhouse gas emissions accounting in the supply chain
3. Status of guideline establishment on supply chain greenhouse gas emissions accounting methods, etc.
1. Supply chain emissions
Up to the present time, the scope of a company's emissions has been defined under various laws as the company's direct and indirect emissions, including Scope 1 (direct emissions from the reporting company's factories, offices, vehicles, etc.) and Scope 2 (indirect energy-derived emissions from electric power and other energy consumed by the reporting company).
However, this system has not been able to identify areas where there is room for reduction in greenhouse gas emissions in the supply chain (such as using raw materials made with more environmentally friendly methods), and it has not motivated companies to seek to reduce emissions by parties other than themselves.
Conceptual diagram of Scopes 1-3
Fig. Conceptual diagram of Scopes 1-3
Source: Based on the Corporate Value Chain (Scope 3) Accounting and Reporting Standard (2011)
Therefore, in recent years, there has been a growing move toward expanding the scope of accounting to cover emissions throughout the supply chain, including Scope 3 (other indirect emissions), which has not been subject to accounting in the past.
This involves not only the reporting company's emissions, but also emissions upstream of the company's activities (such as raw material manufacturing) and downstream of the company's activities (such as product sales).
When Scope 3 is included in accounting for emissions, emissions in the overall supply chain become clear, as well as those areas of the entire supply chain where there is room to reduce emissions.
This can be expected to enable companies to take efficient measures to reduce emissions from a broader perspective, increasing their competitiveness.
By engaging the companies that make up the supply chain (including raw material manufacturers and stores) by asking them for information and so on, it is possible to promote understanding and collaboration, advancing the reduction of greenhouse gas emissions in cooperation among related businesses.
the scope of supply chain emissions and reduction of emissions
Fig. the scope of supply chain emissions and reduction of emissions
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2. Domestic and international trends related to greenhouse gas emissions accounting in the supply chain
The Ministry of the Environment examined trends in supply chain emissions accounting among Japanese businesses, based on public information under the CDP.
In a survey of 500 companies around the world, including both Japanese and foreign companies, it was learned that about 80% have responded to CDP, and more than 50% have also responded concerning Scope 3 emissions.
European and North American companies are further advanced in this area than Japanese firms.
There has been a particularly significant rise in the number of companies reporting Scope 3 emissions, compared to the increase in the number of responding companies overall.
Table: Number of companies responding to CDP Japan in 2010, 2011, and 2012
CDP 2010 CDP 2011 CDP 2012
Number of companies surveyed 507 500 500
Number of responding companies 218(43%) 215(43%) 233(47%)
Number of companies responding with regard to Scope 3 128(25%) 146(29%) 172(34%)
Among companies that responded with regard to Scope 3, only about 6% accounted for at least six categories in CDP Japan 2012, while in CDP Global 2012, about 13% accounted for at least six categories. This indicates that large international corporations are accounting for more categories of emissions than large Japanese corporations.
The figure below shows the results of analysis concerning the proportions of businesses accounting for each category. The proportion of accounting in CDP Global is higher in most categories, with the exception of Category 9 (transportation and delivery, downstream).
In CDP Global, more than half of the companies accounted for Category 6 (business travel). This seems to indicate that companies are starting by accounting for business travel, a category where accounting is easy overseas and where reductions can be achieved.
Meanwhile, it appears that a large proportion of Japanese companies are accounting for Category 9 because reporting on that portion of emissions is provided by specified consigners (shippers) under the Energy Conservation Act. However, it is likely that shippers pay fees for transportation, and in that case, it is a value that should be reported under Category 4 (transportation and delivery, upstream).
This would result in a lower proportion accounting for Category 9 and a higher proportion accounting for Category 4. This confusion between Categories 4 and 9 is considered to occur in CDP Global as well.
Proportion of accounting companies by category in CDP 2012
Fig. Proportion of accounting companies by category in CDP 2012
Table: Accounting categories
Category 1 Purchased goods and services
Category 2 Capital goods
Category 3 Fuel and energy related activities not included in Scope 1 or 2
Category 4 Transportation and delivery (upstream)
Category 5 Waste generated in operations
Category 6 Business travel
Category 7 Employee commuting
Category 8 Leased assets (upstream)
Category 9 Transportation and delivery (downstream)
Category 10 Processing of sold products
Category 11 Use of sold products
Category 12 End-of-life treatment of sold products
Category 13 Leased assets (downstream)
Category 14 Franchises
Category 15 Investments
Trends by industry
The following are the results of an analysis of the proportions of Scope 1, 2, and 3 emissions by industry, based on responses to CDP Global 2011. (Because trends cannot be determined accurately for industries with small numbers of responding companies, the analysis was limited to industries having at least 30 reporting companies.)
[1] Proportions of reporting companies by category
The largest major category for all industries was Category 6 (business travel). Accounting in this category is progressing in every industry.
Among other major categories, reporting on Category 1 (purchased goods and services) was more common in the mining and quarrying of stone and gravel industry; reporting on Category 4 (transportation and delivery, upstream) was more common in the manufacturing industry and wholesale and retail trade; and reporting on Category 13 (leased assets, upstream) was more common in the real estate industry and the goods rental and leasing industry.
Among intermediate categories of manufacturing, besides Category 6 (business travel), reporting on Category 1 (purchased goods and services) was more common in the food manufacturing industry; reporting on Category 11 (use of sold products) was more common in the electrical machinery and equipment manufacturing industry and the transportation equipment manufacturing industry; and reporting on Category 4 (transportation and delivery, upstream) was widespread in many industries.
[2] Proportions of emissions by category
Among major categories, Scope 1 and 2 emissions were higher than Scope 3 emissions in the transport and postal activities industry, the real estate industry, and the goods rental and leasing industry. In all other industries, Scope 3 emissions were higher.
Among intermediate categories of manufacturing, in all of the industries that had at least 30 responding companies, Scope 3 emissions were higher than Scope 1 and 2 emissions.
Among major categories as well as intermediate categories of manufacturing, emissions in Category 11 (use of sold products) accounted for a high proportion in many industries. Emissions in Category 1 (purchased goods and services) accounted for a high proportion in the wholesale and retail trade, food manufacturing, chemical and allied product manufacturing, and electrical machinery and equipment manufacturing industries. Large proportions of emissions fell under Category 10 (processing of sold products) in the non-ferrous metals and products manufacturing industry, Category 12 (end-of-life treatment of sold products) in the chemical and allied product manufacturing industry and the electrical machinery and equipment manufacturing industry, and Category 13 (leased assets, upstream) in the real estate industry and the goods rental and leasing industry.
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3. Status of guideline establishment on supply chain greenhouse gas emissions accounting methods, etc.
The Sustainability Consortium
The Sustainability Consortium is an organization that was established jointly by retailers, suppliers, government agencies, universities, and NGOs in July 2009 with the goal of enabling the collection and analysis of enormous amounts of information concerning the life cycle of products worldwide. It is engaged in information gathering and analysis related to the life cycle of products. At present, approximately 80 organizations are participating, including Wal-Mart and Tesco (retail), Coca Cola (food products), Samsung (electronics), Unilever and P&G (consumer goods). From Japan, Toshiba is participating as a Tier 2 member. It is engaged in the development of a system for the measurement and reporting of sustainability related to environmental and social impacts in the life cycle of products (Sustainability Measurement and Reporting System, SMRS) and related tools.
SMRS is implemented in two stages. At Level 1, the purpose of assessment