Environment
Information Disclosure Based on TCFD
The Group engages to resolve social issues to realize a prosperous and sustainable future society with customers and partners globally. Climate change is considered a significant social issue and exerts a grave impact on the global environment, peoples' lives, and business activities. The Group has identified “promote a decarbonized society” and “realize the circular economy” as priority key challenges (materiality) related to the environment. The Group expressed its support for the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) in October 2021, and is intensifying efforts to reduce its GHG emissions. In addition, the Group will work to realize a decarbonized society by contributing to the decarbonization of customers through its business activities.
① Governance
The Group established the Sustainability Committee in April 2021 to better contribute to the realization of a sustainable and prosperous future. This Committee is considered one of the advisory bodies to the Executive Committee and meets to discuss the climate change issue and other key challenges related to sustainability. The results of the deliberations are reported to the Executive Committee and the Board of Directors. The Materiality announced in December 2021 that includes promotion of a decarbonized society was identified through deliberations by the Sustainability Committee, Executive Committee, and Board of Directors. The Group will promote efforts to identify and manage the impact of climate change on business and reinforce its governance.
Supervision of the Board of Directors and the roles of top management
The Mitsubishi HC Capital Group's Sustainability Promotion Framework

Organizational entities and roles in the sustainability promotion framework
Organizational Entities | Roles |
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Board of Directors | The Board of Directors oversees measures that relate to Company-wide management, including response policies, action plans, and progress on the Groupʼs Materiality and environmental issues in response to reports on the matters deliberated over and resolved by the Executive Committee and reflects those details when determining important matters such as Company strategy. |
Executive Committee | The Executive Committee engages in specific deliberations and resolutions concerning measures that relate to Company-wide management, including response policies, action plans, and progress on the Group's Materiality and environmental issues. Important matters are reported to the Board of Directors. |
Risk Management Committee | The Risk Management Committee is chaired by the Head of the Risk Management Division, and its members comprise the President & CEO, Deputy Presidents, Head of the Corporate & Strategic Planning Division, Head of the Treasury & Accounting Division, Head of the Credit Division, Head of the IT & Operations Division, and directors in charge of auditing. The committee manages risks related to overall management in comprehensive and systematic ways. The overall impact of climate change risks, human rights risks, etc. on other major risks is reported to the Executive Committee. In principle, the committee meets quarterly. |
Sustainability Committee | The Sustainability Committee is chaired by the Head of the Corporate & Strategic Planning Division, and its members comprise the President & CEO, Deputy Presidents, Head of the Treasury & Accounting Division, Head of the Human Resources Division, Head of the Risk Management Division, Head of the Credit Division, and Head of the IT & Operations Division. The committee formulates long-term plans related to the Group's sustainability promotion, including Materiality and environmental issues, as well as goals and plans of non-financial KPIs. The committee also monitors the progress of each business division and reports important matters to the Executive Committee. In principle, the committee meets twice a year. |
Sustainability Committee Office (Corporate & Strategic Planning Department, Corporate & Strategic Planning Division) |
The Administrative Office is responsible for drafting and driving the implementation of plans for Company-wide strategy based on the Group's Basic Sustainability Policy. It gathers knowledge from Japan and overseas in the Group's areas of sustainability and reports to the Sustainability Committee and other bodies along with policies and strategies. |
② Risk Management
Regulatory changes, technological innovation, and shifts in business models in line with the transition to a decarbonized society or extreme weather, etc. stemming from global warming may affect our operating results and financial condition in the form of the business failure of business partners due to earnings deterioration and other factors, the decline in value of assets owned by the Group, and in other ways. The Group recognizes climate change risk as one of the critical risks in Company-wide risk management and will promote efforts to properly identify and manage it.
a.Risk management system overview
The Group uses its integrated risk management framework to comprehensively manage risks that could have a substantial impact on investors' decisions.
The important risks managed within the integrated risk management framework include, but are not limited to, credit risks, asset risks, investment risks, market risks, liquidity risks, and operational risks.
To manage envisaged risk factors, the departments overseeing specific risks monitor issues arising from developments in the external environment or other changes, regularly consider measures to address such risks, and then report and deliberate them at meetings of each committee including the Risk Management Committee. In addition, we operate a risk management system in which important matters are reported to and discussed by the Executive Committee and Board of Directors.
b.Classification and examples of impacts of climate change risks
Climate change risks consist of transition risks associated with climate-related regulation tightening and technological innovation, etc. and physical risks associated with extreme weather and changes in climates. The TCFD recommendations classify these risks into the subcategories of policy and legal/technology/market/reputation, and acute/chronic, and present examples of impacts.
The Company recognizes that impacts of climate change risks occur over various time frames such as short, medium and long term through broad transmission routes including existing risks like credit risks, asset risks and investment risks. Furthermore, in addition to direct impacts on the Company's business activities, the onset of indirect impacts through the Company's customers is also possible.
Based on such risk characteristics and details of the TCFD recommendations, the Company categorizes examples of impacts of climate change risks for each of its major risks, also taking into account its risk management framework. Under the integrated risk management system, the Company is also advancing the establishment of a system to identify/assess and manage climate change risks in light of relations with other major risks.
Going forward, the Company will review the risk classification and examples of impacts according to changes in the external environment, and deepen analysis and assessment of climate change risks.
Classification and examples of impacts of climate change risks
Major Risks | Timeframe*1 | Transition Risks | Physical Risks |
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Credit Risk | Short to long term |
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Asset Risk | Short to long term |
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Investment Risk | Short to long term |
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Market Risk | Short to long term |
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Liquidity Risk | Short to long term |
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Operational Risk | Short to long term |
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Reputational Risk | Short to long term |
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Strategic Risk | Medium to long term |
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- Short term: until 2025, Medium term: until 2030, Long term: until 2050
(Reference) Classification and Examples of Impacts in the TCFD Recommendations
Transition risks: Risks related to the transition to a lower-carbon economy
Type | Environmental Changes Brought by Climate Change | Impacts on Customers/MHC, etc. |
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Policy and Legal Risk |
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Technology Risk |
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Market Risk |
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Reputational Risk |
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Physical risks: Risks related to physical changes caused by climate change
Type | Environmental Changes Brought by Climate Change | Impacts on Customers/MHC, etc. |
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Acute Risk |
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Chronic Risk |
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c.Status of integration into overall risk management
Comprehensive impacts of climate change risks on other major risks are reported to and discussed by the Risk Management Committee. We will advance the reflection of such risks, including risks identified through scenario analysis, in overall risk management by establishing a monitoring system and other means. In addition, the development of targets and plans related to climate change and details of monitoring are reported to and discussed by the Sustainability Committee. Details of discussions of both committees are reflected in the Company's management strategies under the system of monitoring by the Board of Directors so that we can appropriately address the risks from both the perspectives of overall risk management and individual risks.
③ Strategy
The Company identifies risks and opportunities brought by future climate change to the Group, and conducts scenario analysis on transition risks and physical risks for the purpose of appropriately disclosing information and considering future measures.
Scenario analysis is carried out based on limited information and data available at present. We will strive to reflect the analysis in appropriate disclosure by carefully interpreting the results of this analysis, obtaining more information and relevant data through dialogues with stakeholders, and promoting the refinement of analysis methods and expansion of businesses to be analyzed.
a.Overview of the scenario analysis
Overview of transition risk analysis
Target Sector and Main Segment |
Target Sector | Main Segment |
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Energy (oil, gas, coal, and electric utilities) | Environment & Energy | |
Transportation (air freight and passenger air transportation) |
Aviation | |
Materials and Buildings (real estate management and development) |
Real Estate | |
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Sector and Segment Selection Method |
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Scenario |
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Analysis Method |
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Overview of physical risk analysis
Analysis Subject |
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Scenario |
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Analysis Method |
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b.Results of the scenario analysis
The Business Divisions responsible for the segments targeted for scenario analysis—Environment & Energy, Aviation, Real Estate, and Customer Solutions—have discussed the impacts on our business and confirmed consistency between the results of the scenario analysis and the existing strategic policy.
The Group endeavors to minimize risks and maximize opportunities by taking short- and long-term measures as for risks and opportunities related to climate change. As a result of the transition risk analysis, we recognize the need to appropriately handle risks and opportunities associated with the expansion of renewable energy (Environment & Energy), the shift to low mileage aircraft/engines and low-carbon fuels such as SAF and hydrogen (Aviation), the growing demand for low-carbon buildings (Real Estate), etc. Furthermore, as a result of the physical risk analysis, we anticipate risks including damage caused by disasters to power stations and deterioration of power generating facilities such as solar panels (Environment &Energy), loss in value of real estate due to intensification of natural disasters and increases in construction/operation expenses and renovation costs (Real Estate), damage caused by disasters to the Group's offices, and increases in operating expenses and insurance costs.
While appropriate countermeasures for climate change risks have been developed, the acquisition of business opportunities has been incorporated into strategies for opportunities brought by climate change. Going forward, we will reflect KPIs related to climate change in the process of implementing the Medium-term Management Plan, and establish a system to regularly monitor relevant trends in Japan and abroad, and the status of initiatives of the Group.
Results of the scenario analysis
Type of Risks/Opportunities | Timeframe*1 | Details of Climate Change-related Risks and Opportunities | Measures to Address Risks/ Measures to Realize Opportunities | ||
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Risks | Transition Risk |
Policy and Legal |
Short to long term |
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Technology | Short to long term |
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Market | Short to long term |
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Reputation | Short to long term |
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Physical Risk | Short to long term |
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Opportunities | Products and Services |
Short to long term |
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Markets | Short to long term |
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Long term |
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- Short term: until 2025, Medium term: until 2030, Long term: until 2050
④ Metrics and Targets
Based on the recognition that efforts to realize a decarbonized society are an urgent issue, we will set the Group's GHG reduction targets pursuant to the Paris Agreement, and we see the transition to a decarbonized society as an opportunity and actively promote the transition.
In cases where GHG emissions increase significantly in the future due to efforts for new businesses, or where numerical values change while the calculation of GHG emissions of the entire Group including supply chains become sophisticated, and in other cases, the established targets may be reviewed appropriately, however we plan to set the targets so that any targets are in line with the level of the Paris Agreement, in the same way as the targets established this time.
a.The Group's targets for the reduction of GHG emissions
Scope 1 and Scope 2 | Short Term (Every Year) | Medium Term (to Fiscal 2030) | Long Term (to Fiscal 2050) |
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Energy usage in Japan: -1% compared to the prior fiscal year |
-55% compared to fiscal 2019 | Net zero |
b.Future efforts
For Category 11 (Use of sold products), Category 13 (Downstream leased assets) and Category 15 (Investments) of Scope 3, which are expected to comprise a majority of the Group's GHG emissions, we also consider measurement methods and conduct discussions toward disclosure.
Going forward, we will consider the reduction of GHG emissions of the entire Group, including supply chains, through visualization of the status of GHG emissions related to business transactions, formulation of policy for sectors with high GHG emissions and the transaction plan, and other means.