Policy & Basic Approach
The ITOCHU Group Basic Policy on Promotion of Sustainability
ITOCHU Group, conducting business globally under the spirit of "Sampo-yoshi", the management philosophy of merchants in the Ohmi province of Japan (present-day Shiga Prefecture) which is our Corporate Mission, considers that addressing global environmental and social issues is one of the top priority issues in its management policy. We contribute to the realization of a sustainable society based on the ITOCHU Group Code of Ethic Conduct, in order to achieve the goals of The ITOCHU Group Corporate Guideline of Conduct, "I am One with Infinite Missions."
- (1) Identification of material issues and promotion of businesses that address the social issues
As a member of the international community, we will identify and assess material issues where we can create the most social and environmental value for that can enhance the sustainable growth of both society and our business.
- (2) Establishment of mutual trust with society
We will take necessary measures to ensure that we disclose accurate and clear information and maintain a communicative relationship with our stakeholders. In doing so, we aim to be receptive and responsive to the expectations and demands of society.
- (3) Strengthening supply chain and business investment management to lead to sustainable use of natural resources with respect for human rights and consideration for the environment
While engaging in business activities, we respect the legal systems of each country and international rules, and strive to prevent the occurrence of environmental pollution and/or human rights and labour issues that threaten our lives. In addition, we give due consideration to the mitigation of and adaption to climate change, the preservation of the global environment, such as through the conservation of biodiversity and ecosystems, and human rights issues.
We endeavour to understand how natural resources are utilized (such as air, water, land, food, minerals, fossil fuels, animals, and plants) and what consideration is given to human rights and labour issues, both in the businesses where we invest and in the supply chains related to the products we handle. We request our business partners to understand and implement our concept of sustainability, and aim to build a sustainable value chain.
- (4) Education and awareness of employees to promote sustainability
We believe that the promotion of sustainability starts with each and every employee. Therefore, we will take necessary measures to educate our employees on the material sustainability issues we have identified and nurture a sustainability mindset among the workforce. Every employee is expected to adhere to this policy by executing respective action plans drafted in alignment to this policy.
Critical Issues (Material Issues)
In April 2018, ITOCHU put forth material sustainability issues that incorporate an ESG perspective. Addressing these issues through its main business will help ITOCHU accomplish its FYE 2019-2021 Medium-Term Management Plan's goal of achieving ongoing growth through ITOCHU Mission, the spirit of "Sampo-yoshi". ITOCHU's sustainability initiatives, which aim to fulfill our responsibilities for the society of today and the future, also contribute to the achievement of the Sustainable Development Goals (SDGs)* adopted by the United Nations in 2015.
ITOCHU Europe, as the regional head quarter in Europe, identified the following material sustainability issues that address the social issues, which are substantially identical to the ITOCHU’s material sustainability issues.
Material Sustainability Issues
Evolve Businesses Through Technological Innovation
We create new value by proactively exploring new technologies as we adapt to a transforming industrial establishment by venturing beyond the framework of our existing business.
Address Climate Change
(Contribute to Realization of a Low-Carbon Society)
As we endeavor to adapt to climate change's impact on business, we further business activities that contribute to a low-carbon society and work to reduce greenhouse gas emissions.
We provide a setting where employees are proud and motivated, and where we can leverage diversity so they can fully exhibit their capabilities.
Respect Human Rights
While showing respect and consideration for human rights in our operations, we bring stability to our business and contribute to the development of local communities.
Contribute to Healthier and More Enriched Lifestyles
With the intention of raising quality of life for all people, we help make healthy, bountiful living possible.
Ensure Stable Procurement and Supply
With aspirations for a recycling-oriented society, we give consideration to biodiversity and other important aspects of the environment to engage in effective use and steady procurement and supply of resources in line with their demand in each country.
Sustainability in Our Supply Chain
BASIC STANCE ON SUPPLY CHAIN MANAGEMENT
ITOCHU Europe PLC also gives consideration to human rights, labour and the environment in our supply chain and business investments. We do this through sustainability management tailored to each business activity. Through this, we have built a sustainable value chain. This is leading to an improvement in the competitiveness and corporate value of the ITOCHU Group.
Sustainability Action Guidelines for Supply Chains
ITOCHU Europe PLC adopted the "Sustainability Action Guidelines for Supply Chains" to clarify and communicate the sustainability concerns we expect our suppliers to address. We will take necessary measures to communicate and cooperate with our suppliers to ensure responsible management of the following items:
- Suppliers shall respect the human rights of all of its employees and shall not engage in inhumane treatments, including discrimination, harassment, abuse and corporal punishment.
- Suppliers shall not engage in forced labour or child labour and must prohibit the employment of children under the minimum working age.
- Suppliers shall not engage in employment discrimination based on characteristics including but not limited to gender, race, and religion.
- Suppliers shall comply with statutory minimum wages and aim to exceed living wages. Also, suppliers shall not conduct unjust wage reductions.
- Suppliers shall respect the freedom of association and right to collective bargaining of its employees and ensure that labour-management discussions on working conditions and environment are held, as appropriate.
- Suppliers shall comply with statutory working hour restrictions. Suppliers shall also appropriately manage its employees' working hours and provide holidays and paid leaves as necessary. Finally, suppliers shall strictly prohibit excessive overtime work.
- Suppliers shall take necessary measures to provide a safe, hygienic and healthy working environment to its employees.
- With regards to its business activities, suppliers shall consider potential and existing impacts on local communities and the environment – such as impacts on nearby biodiverse habitats or pollution of the local ecosystem. Suppliers shall also take necessary measures to reduce its consumption of energy, water and other natural resources, as well as its emissions of greenhouse gases and waste.
- Suppliers shall comply with all applicable local and international laws and regulations. Suppliers shall also ensure its compliance to fair business practices and anti-corruption.
- Suppliers shall disclose information on all items listed above in a timely and appropriate manner.
At ITOCHU Europe PLC, we are serious about addressing human rights issues, including modern slavery and human trafficking.
Please refer to our statements for further information.
ITOCHU Europe Green Finance Framework
As the regional headquarters of ITOCHU’s operation in Europe, ITOCHU Europe Plc (ITOCHU Europe) published its Green Finance Framework in March 2019 (updated in July 2020) and raised its first green loan of EUR150Million from Mizuho Bank and ING Bank through ITOCHU Treasury Centre Europe Plc, ITOCHU’s group finance vehicle for Europe and the Middle East the same month. This was the first green finance procured by any of the Japanese trading houses (so-called “Sogo shosha”). ITOCHU Europe Green Finance Framework was supported by ING, which acted as a Green Structuring Advisor, and was independently reviewed by Sustainalytics.
As a group, ITOCHU believes in the importance of fulfilling its social responsibilities. This is accomplished through the continuous enhancement of sustainable corporate values within its core business, in accordance with the group’s mission, “Sampo-Yoshi” (good for the buyer, good for the seller, and good for society), the management philosophy of merchants in the province of Ohmi that has been embraced by the company since its founding in 1858.
In April 2018, ITOCHU adopted an Environmental, Social and Governance (ESG) mindset to identify material sustainability issues in its Medium-Term Management Plan entitled “Brand-new Deal 2020”. By addressing these critical issues through our primary business operations, we are working towards sustainable growth through a reinvented “Sampo-Yoshi” approach that will achieve the goals of Brand-new Deal 2020. Sustainability initiatives of ITOCHU, which fulfil its responsibilities for the present and future society, also contribute to the achievement of the Sustainable Development Goals (SDGs), which were adopted at a UN Summit in 2015.
The ITOCHU Europe Green Finance Framework highlights how the activities of ITOCHU Europe are supporting two of the SDGs, namely affordable and clean energy and responsible consumption and production. These consist of material sustainability issues identified by ITOCHU at group level.
Mr Hiroshi Sato, CEO of ITOCHU Europe, explained “Sustainability is a key driver of ITOCHU Europe’s business activities, ranging from textiles, machinery, non-ferrous metals, foodstuffs, chemicals, general merchandise and some financial transactions. ITOCHU Europe, together with ITOCHU group companies in the region, would like to achieve growth by expanding our sustainable business in such ways as developing and introducing new technology for environmentally friendly materials, deploying sophisticated technology to save energy, and investing in energy efficient and/or renewable energy projects. Establishing the green finance framework is an important milestone for us, showing our clear commitment to sustainability to the public here in Europe”.
"Mizuho is proactively contributing to the sustainable growth of our clients and the communities that we serve, and we believe it is vital to assist our clients with the provision of sustainability finance. As our clients' best financial solutions partner, offering a full range of innovative services including green loans, we will continue using our group's full capability to support our clients' ESG initiatives." said Hiroshi Nagamine, Managing Executive Officer and Head of EMEA, Mizuho Bank, Ltd.
“ING is committed to creating sustainable solutions for clients. Our team is proud to have done so for Itochu,” said Reiji Matsushima, Head of Diversified Corporates at ING in Tokyo.
“As a bank, the choices we make in financing our clients enable us to contribute to a sustainable economy, and green loans are a big part of our sustainable finance portfolio. While we continuously support our clients with sustainable business solutions, we make the biggest impact through our financing” said Leonie Schreve, Global Head of Sustainable Finance, ING.
Use and Source of green finance:
1. List of eligible projects (updated in July 2020)
(*1) COD=Commercial Operation Date
(*2) “Capacity” is generation capacity for Renewable Energy and capacity for waste treatment volume per year for EfW.
2. Use and source table as of March 2020
|Use of Proceeds (€Mil)||Source of Proceed(€Mil)|
|Renewable Energy||205||Green Loan March 2019
from Mizuho and ING
|Pollution Prevention and Control||98||Other Sources||153|