Climate Change Mitigation and Adaptation

Rapid climate change poses a major threat to humanity and to all life-forms on earth. We recognize that helping combat this threat and contributing to the decarbonization of society are corporate responsibilities and important management issues.

Under the guidance of the Working Group for Climate Change, a working group chaired by a managing executive officer positioned under the Sustainability Committee, which is chaired by the president and representative director, the Yamaha Group is working to contribute to the global movement to reduce CO2 emissions. At the same time, we are preparing for the potential impact of climate change by identifying risks, formulating mitigation measures, and incorporating these into business strategies.

Endorsing the goals of Science Based Targets,*1 an international initiative encouraging companies to formulate greenhouse gas emissions reduction targets in accordance with scenarios based on scientific rationality, the Group received certification from this initiative for its medium- to long-term reduction targets in June 2019. Later, in September 2021, the Company received certification for a new greenhouse gas emissions target of realizing a reduction of 55% in Scope 1 and Scope 2 emissions from fiscal 2018 to be achieved by fiscal 2031, substantially higher than the prior target of a 32% reduction. The certification indicates that this new more ambitious target is viable for limiting global warming to 1.5ºC above pre-industrial levels. The move was taken in response to the carbon neutrality trends of the international community. Furthermore, the Group declared its endorsement of the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD)*2 in June 2019 and commenced initiatives for analyzing the impact of climate change on its finances and disclosing related information.

Going forward, the Yamaha Group will continue to pursue reductions in greenhouse gas emissions and work to address the impact of climate change. At the same time, we will seek to create products, services, and business models that help mitigate climate change and promote the decarbonization of society through energy-efficient products and other means.

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  • *1 Science Based Targets is an international initiative that encourages companies to formulate greenhouse gas emissions reduction targets in accordance with scenarios based on scientific rationality to contribute to the accomplishment of the goals of the Paris Agreement.
  • *2 TCFD is a task force created by the Financial Stability Board that has released recommendations aimed at facilitating appropriate investment decisions through disclosure of the potential financial impacts of climate change.

Greenhouse Gas Emission Reduction Targets (SBT-Certified)

  • Reduce total Scope 1*3 and Scope 2*4 greenhouse gas emissions by 55% from fiscal 2018 levels by fiscal 2031
  • Reduce total Scope 3*5 greenhouse gas emissions by 30% from fiscal 2018 levels by fiscal 2031
  • *3 Scope 1 emissions are direct greenhouse gas emissions from a business operator through sources such as fuel use on company premises.
  • *4 Scope 2 emissions are indirect greenhouse gas emissions from use of electricity, heat, and steam supplied by third parties.
  • *5 Scope 3 emissions are indirect greenhouse gas emissions from areas of the supply chain not accounted for under Scope 1 and Scope 2.

Major Greenhouse Gas Emissions Reduction Initiatives

  • Energy-saving initiatives including optimization of production methods and equipment placement, installation of high-energy-efficiency equipment and LED lighting, and exhaustive management of facility operation times, air-conditioning temperatures, and other energy consumption factors
  • Introduction of cogeneration systems and solar power generation systems
  • Transition to fuel sources with low greenhouse gas emissions
  • Switch to purchasing renewable energy
  • Improvement of transportation efficiency and shift to low-carbon transportation methods (ships and trains) in distribution
  • Development of energy-efficient products (reduction of emissions from large-volume Scope 3 emissions category (product use))

Initiatives and Achievements to Date

Yamaha Corporation and domestic production sites are advancing energy conservation and other initiatives in manufacturing processes and at offices to achieve the long-pursued target of reducing CO2 emissions per unit of production by 1% or more each year. In fiscal 2021, after the establishment of SBT-certified targets, we began introducing renewable energy on a full-fledged scale and thereby shifted to renewable energy for two-thirds of the power purchased at the Company headquarters, and we transitioned to renewable energy for 100% of power in April 2021. At overseas production sites, quantitative reduction targets are set on an individual-site basis, and proactive initiatives are being implemented toward the accomplishment of these targets.

In advancing emission reduction initiatives, we manage greenhouse gas emission volumes in accordance with the Greenhouse Gas Protocol.*6 In addition, third-party verification has been received for Scope 1 and Scope 2 emissions and certain Scope 3 emissions since fiscal 2017.

  • *6 The Greenhouse Gas Protocol is a set of standards for calculating and reporting greenhouse gas emission volumes.

Scope 1 and Scope 2 Emissions (Yamaha Corporation and all production sites)*7 *8 *9 *10

Total GHG emission (site / yearly emission coefficient)
  • *7 The scope of data collection is comprised of Yamaha Corporation headquarters and major factories and resort facilities around the world (estimated to account for over 95% of all Yamaha Group sites*8).
  • *8 Two new production sites (Yamaha Music India Pvt. Ltd. and PT. Yamaha Musical Products Asia) are not included among Yamaha Group business sites at this point in time.
  • *9 Figures differ from those previously released as figures were recalculated to further subdivide regional and power company coefficients by base and by fiscal year.
  • *10 Figures use the combined value of indirect emissions through purchased electricity and steam, direct emissions of CO2 through in-house power generation and heat usage, and greenhouse gas emissions from manufacturing processes.

Scope 3 Emissions (Fiscal 2021)

Scope 3

CO2 Absorption through Tree Planting Activities in Indonesia

After conducting Yamaha Forest tree planting activities in Indonesia over the period from fiscal 2006 to fiscal 2017, the Company confirmed the growth status of the forest via satellite imagery and estimated the volume of CO2 absorbed by the trees in fiscal 2018. The Company estimates that approximately 42,000 tons of CO2 have been absorbed to date.

Manufacturing Process Initiatives

Energy Conservation Activities at String and Percussion Instrument Factory

Yamaha Music Manufacturing Japan Corporation, which manufactures string and percussion instruments, has established the Energy-saving Promotion Committee and has been engaged in initiatives to reduce CO2 emissions. Measures taken have included ensuring the appropriate pressure for compressors, partitioning work booths, introducing power usage monitors, and installing door and window screens for ventilation in offices. This company is also implementing measures to improve energy efficiency and to save space by consolidating equipment inside factories and rationalizing equipment layouts. Furthermore, this company has applied a thermal-barrier coating to the roof of the factory, improving air-conditioning efficiency as a result.

Energy Conservation Measures at Piano Factory

Yamaha Music Manufacturing Japan is conducting a range of ongoing efforts to conserve energy. Specific activities include removing unnecessary lighting, changing from fluorescent lighting to LED lighting, replacing prior compressors with inverter compressors, upgrading distribution transformers and air-conditioning equipment, and improving air-conditioning control. Energy conservation efforts in fiscal 2021 included integrated compressor control to allow for efficient operation during low-load periods. Through these activities, this company has succeeded in reducing CO2 emissions by 452 t-CO2 and cutting electricity usage by 708 MWh on an aggregate basis over the seven-year period from fiscal 2015 to fiscal 2021. Furthermore, cogeneration systems have been utilized to cut CO2 emissions by 2,900 t-CO2 a year (equivalent to 420 kL of crude oil a year).

Cogeneration system at Kakegawa Factory

Reduction of Peak Power Consumption at Factory

At Yamaha Fine Technologies Co., Ltd., steps are taken to cut peak power consumption during the summer by efficiently managing air conditioning and sprinkling water on the factory roof. In addition, a summer time system was introduced in fiscal 2015. Over the three-month period from July to September, the work start time is moved two hours ahead to 6:00 a.m. for certain automobile interior parts painting processes that require high levels of air conditioning. Through these measures, the peak power consumption point was shifted from 2:00 p.m. to 11:00 a.m. As a result, peak power consumption was reduced by approximately 310 kW in the hotter part of the afternoon, and power consumption was lowered by 200,000 kWh during the three-month period from July to September. Moreover, this company is making efforts to conserve electricity, such as improving labor efficiency by shortening facility operating hours, reviewing workplace layouts to reduce air-conditioning requirements, and revising how steam is used during the winter.

Energy Conservation Activities at a Factory in China

Hangzhou Yamaha Musical Instruments Co., Ltd., has introduced various energy conservation activities that include making technological improvements and enhancing management of daily work activities to curb the increase in energy consumption stemming from rising production levels. Recognizing these energy conservation activities and other environmental initiatives, Hangzhou City officials presented this company with a Cleaner Production Certification in accordance with China’s Cleaner Production Promotion Law at the end of 2011. Since then, this company has continued to implement the following measures to reduce energy usage.

  • Appropriate operation management of dust collectors
  • Shortening of water supply operation times, strategic positioning of lighting, and reduction of lighting usage times
  • Installation of automatic control system for dust collectors and digital electricity meters in switchboards to enhance management of electricity consumption and reduce losses from idle power consumption by machinery at night
  • Sequential shift from fluorescent lighting to LED lighting
Bulletin board providing notice of energy conservation and other environmental activities
Environmental education for employees

Environmental Initiatives at Resort Facilities

Yamaha Resort Inc. is implementing the following CO2 emission reduction initiatives at the resort facilities it operates.

Reduction of CO2 Emissions and Fuel Consumption in Golf Course Operations (Katsuragi Golf Club):
  • Annual reductions in CO2 emissions of more than 8 tons achieved by switching from gasoline golf carts to electric carts (fiscal 2014)
  • Annual electricity savings of 25 MWh through "green fan" initiatives (greens maintenance) and adjustment of facility air conditioning (fiscal 2019–2020)
  • Approx. 30% reduction in boiler fuel consumption (heavy oil) and one-hour reduction in boiler operation time through replacement of all large-scale, air-conditioning systems that use hot water for heating with energy-efficient air-cooling systems (completed in fiscal 2020)
Reduction of CO2 Emissions in Hotel Operations (Katsuragi Kitanomaru):
  • Two high-efficiency boilers installed to replace existing boilers in both fiscal 2019 and fiscal 2020
Transition to LED Lighting (Katsuragi Golf Club and Katsuragi Kitanomaru):
  • Annual electricity savings of 49 MWh through switch to LED lighting and installation of motion sensors in restrooms (fiscal 2018–2020)
  • Annual electricity savings of 28 MWh through replacement of mercury lamps with LED lighting in clubhouse lobby and Kitanomaru garden (fiscal 2021)

Initiatives at Offices

Priority Electricity Conservation Measures

Electricity conservation measures at offices include reducing the amount of lighting (after verifying lighting levels), introducing LED lighting, turning off lit advertisements, halting elevator operation, and notifying employees of electricity consumption amounts to raise awareness.

Transition to LED Lighting

The Yamaha Corporation headquarters is promoting the transition to LED lighting in office spaces, and approximately 1,200 fluorescent lights and mercury lamps have been replaced with LED lighting over the eight-year period spanning from fiscal 2014 to fiscal 2021. As a result, annual electricity consumption has been reduced by 52 MWh. Meanwhile, the transition to LED lighting outside of the Toyooka Factory has produced annual savings of 44 MWh while an additional reduction of 50 MWh in annual electricity consumption has been achieved by replacing approximately 3,700 fluorescent lights inside of the factory with LED lighting over the five-year period from fiscal 2017 to fiscal 2021. Going forward, we will continue to systematically transition to LED lighting in factories and offices.

“Cool Biz” and “Warm Biz” Initiatives

During summer (May to October), we encourage employees to wear cooler attire, such as by not using a necktie, and set the air-conditioning temperature to over 28°C. In winter (November to March), employees are asked to wear warmer clothes so as not to rely too heavily on heating, and the temperature of heaters is set to under 20°C.

In-house educational posters promoting the “Cool Biz” and “Warm Biz” programs

Initiatives in Logistics

Energy Conservation and CO2 Emission Reduction in Logistics

The Yamaha Group is working to increase energy efficiency and reduce CO2 emissions in logistics operations together with efforts to improve transportation efficiency and shorten transportation lead times. To this end, we are incorporating CO2 emission reduction initiatives into various activities. For example, we are working to raise truck and container loading ratios, review warehouse locations and transport routes to shorten transportation distances, examine the possibility of incorporating low-carbon modes of transportation (ships and trains), revise transportation packing specifications, conduct joint transportation with other companies, and dispose of waste in the area it is produced.

The Group's total domestic transport volume (including transportation by domestic sales companies, etc.) in fiscal 2018 remained about the same as fiscal 2017 at 18.6 million ton-kilometers. CO2 emissions were also relatively unchanged year on year at 2,820 t-CO2.

Reducing CO2 emissions from logistics requires the cooperation of transportation companies. As such, we are working with them to develop the necessary systems by requesting that the transportation companies we work with cooperate in environmental efforts and incorporating environmental matters into questionnaires.

Resource Conservation and CO2 Emission Reduction in Piano Frame Transportation

Previously, the Yamaha Group has used disposable iron packing racks when transporting piano frames from Japan to overseas factories. However, we are gradually introducing returnable packing racks for piano frames that can be used multiple times in order to conserve resources. In addition, by shortening transportation routes and improving load efficiency, the Company has achieved a 100-ton reduction in CO2 emissions associated with the disposal of iron packing and a 1,600-ton reduction in iron resource consumption. Going forward, we will examine the possibility of shortening transport distances and reducing disposable packing material use, including for parts aside from piano frames.

Distribution flow using returnable packing racks
Returnable packing rack for grand piano frames
Folded returnable packing rack (when being returned)

Standardization of Packaging for Shipping Components and Materials to Conserve Resources and Reduce CO2 Emissions

The Yamaha Group designs and standardizes packing boxes according to the sizes of the containers used in transportation, thereby improving container loading ratios. We have thereby been able to reduce the number of containers used and eliminate three tons of associated CO2 emissions a year. The Group has also cut down on paper resource usage by designing packaging that uses as little cushioning and other packaging materials as possible. Going forward, it can be projected that the supply of materials and components from overseas locations to Japan will increase. Our first step to respond to this trend will be to design standard packing boxes for piano components that can be used for transportation between China and Japan, and we are engaged in verification testing with the aim of putting these packing boxes into practical use.

Loading container with pre-standardization packing boxes (left) and loading container with standardized packing boxes (right)

Rapid climate change poses a major threat to humanity and to all life-forms on earth. We recognize that helping combat this threat and contributing to the decarbonization of society are corporate responsibilities and important management issues.
In fiscal 2019, the Group declared its endorsement of the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and commenced initiatives for analyzing the risks and opportunities for its business created by climate change. This information is reflected in management strategies, and information on the financial impacts of these risks and opportunities is disclosed.

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Yamaha’s Initiatives

Governance

Addressing climate change has been positioned as an important management strategy and a portion of our sustainability governance and management systems. Climate change and other important sustainability issues are discussed at meetings of the Sustainability Committee, which is an advisory body to the president established in January 2021, after which these matters are discussed and examined by the Board of Directors to make for a system of appropriate super-vision by the Board of Directors. The Sustainability Committee is scheduled to meet 10 times in fiscal 2022.
Measures for responding to climate change-related risks and opportunities are discussed by the Working Group for Climate Change, a working group chaired by a managing executive officer positioned under the Sustainability Committee, and the results of these discussions are reported to the Sustainability Committee.

Strategy

The risks and opportunities that may result from climate change or the accompanying phenomena are incorporated into the important elements of business strategies. For example, the current medium-term management plan includes among its core measures efforts to reduce greenhouse gas emissions, develop eco-friendly products, and realize sustainable timber use.
We recognize that the impacts of climate change will likely be felt over the medium to long term. Accordingly, we have defined the associated risks and opportunities from a medium- to long-term perspective looking to 2030 and beyond rather than based on the short-term time frame of the three-year medium-term management plan. The identified risks will be periodically examined and revised based on internal and external trends.

Risks and Opportunities The Group employed the various scenarios described to determine the risks and opportunities that could occur as a result of the transformation of the operating environment in response to rapid climate change and the accompanying phenomena. The specific scenarios utilized were the Sustainable Development Scenario (global warming of less than 2°C above pre-industrial levels) and the NZE Scenario (net zero emissions by 2050 and global warming of 1.5°C above pre-industrial levels) of the International Energy Agency (IEA) for transition risks and the Representative Concentration Pathway (RCP) 2.6 (global warming of 2°C above pre-industrial levels) and RCP 8.5 (global warming of 4°C above pre-industrial levels) scenarios of the Intergovernmental Panel on Climate Change for physical risks. Based on these scenarios, we are evaluating the degree of materiality of risks and opportunities based on their potential financial impact and likelihood of materialization.
Major Climate Change-Related Risks and Opportunities Although climate change risks are not expected to have a serious impact on the Company’s business within the next several years, long-term business impact projections and strategies associated with these risks are slated to be formulated based on discussions centered on the Working Group for Climate Change. The following measures are being implemented to address the risks identified at this point in time, and we will continue to strengthen management of these risks to ensure that they do not have a significant impact on our business over the medium to long term.
Transition Risks
Scenarios that involve the implementation of various measures aimed at the realization of a decarbonized society present risks related to higher energy prices and additional costs resulting from carbon pricing systems.
The Yamaha Group will address these risks by ramping up its decarbonization initiatives. Specifically, we altered our prior greenhouse gas emissions reduction target (reduction of 32% in Scope 1 and Scope 2 emissions from fiscal 2018 to be achieved by fiscal 2031), which had been certified by Science Based Targets as a target for limiting global warming to 2ºC above pre-industrial levels, and received certification for the new target (reduction of 55% in Scope 1 and Scope 2 emissions from fiscal 2018 to be achieved by fiscal 2031) in September 2021, indicating it as being viable for limiting global warming to 1.5ºC above pre-industrial levels. By accelerating initiatives to achieve this more ambitious target, we aim to mitigate various transition risks.
Other transition risks include the risks of companies withdrawing from the timber business due to the decarbonization trends, resulting in difficulties procuring timber.
The Group has proceeded to raise the rate at which it uses certified timber, which can be procured reliability, from the perspective of the sustainability of forest resources, and our ratio of certified timber use was 48% in fiscal 2021. In addition, with our dedicated timber-related technology and procurement divisions, we have accumulated the expertise necessary to quickly switch to an alternative source should it become difficult to procure timber from a specific location. Furthermore, we conduct rigorous legal checks to prevent the procurement of timber from illegal sources and ensure that we are able to continue using timber resources in a sustainable manner.
Physical Risks
Global warming threatens to change the environments is which the timber we procure is produced. The Group undertook an investigation that looked at the major tree species from which we procure timber and was based on an academic thesis. This investigation indicated a possibility that the environments in which several of these tree species are cultivated might shrink as a result of global warming. Should it become difficult to procure timber from these tree species, resulting in increases in raw material prices, it would constitute a business risk. For this reason, we will carefully monitor circumstances related to the production of these tree species in the future and make preparations so that, should it be deemed that our operations might be impacted by these circumstances, we will be able to quickly shift to alternative tree species.
With regard to floods and other risks, we completed establishment of business continuity plans for all Yamaha business sites around the world. We have also taken precautionary measures such as installing drainage equipment to safeguard against damages from typhoons, floods, and other natural disasters projected on an individual business site basis. In addition, we have implemented measures such as revising the locations and structure of Company business sites and even external warehouses. Based on the results of scenario analyses (evaluation of RCP 8.5 (global warming of 4°C above pre-industrial levels) and projected once-in-a-century flooding in 2050), the risk of major Yamaha Group bases becoming submerged has been deter-mined to be low (there are no bases in river or coastal flood zones with the potential to experience flooding of more than one meter above floor level).
Opportunities
Climate change-related opportunities for Yamaha include the potential for increased demand for its products as consumers limit movement to help combat climate change or face restrictions on outdoor activities due to rising temperatures. Specifically, it is possible that demand will grow for all varieties of musical instruments as well as for communications equipment. In addition, the trend toward decarbonization could drive the popularization of EVs, leading to increased sales of high-end in-vehicle speaker systems to customers seeking to enjoy high-quality music in their quiet vehicles.
[ image ] Results of Scenario Analyses
[ image ] Potential Changes in Timber Procurement Region Environments from Base Year

Risk Management

The Risk Management Committee has been established as an advisory body to the president, and regular evaluations and analyses are performed on the potential damages, frequency, and control levels of risks. This process is used to facilitate ongoing improvements in risk control levels by identifying risks and designating the divisions responsible for managing these risks. In addition, the Working Group for BCP and Disaster Prevention Management has been set up under the Risk Management Committee to establish business continuity plans and implement other business continuity management initiatives to address the physical risks associated with natural disasters.

Metrics and Targets

The Company has set the medium-term targets of reducing total Scope 1 and Scope 2 greenhouse gas emissions by 55% and total Scope 3 greenhouse gas emissions by 30% from fiscal 2018 levels by fiscal 2031. In addition, we have set a long-term target of achieving carbon neutrality by fiscal 2051. These targets have been certified by Science Based Targets as targets for limiting global warming to 1.5ºC above pre-industrial levels. On a short-term basis, we have established the target of reducing CO2 emissions per unit of production by 1% or more each year at major domestic business sites.
We manage greenhouse gas emission volumes in accordance with the Greenhouse Gas Protocol, and third-party verification has been received for Scope 1 and Scope 2 and certain Scope 3 emissions since fiscal 2017. Energy consumption amounts pertaining to Scope 1 and Scope 2 emissions are calculated on a by-source basis, which is translated into greenhouse gas emission data using emission coefficients. Third-party verification is received for this data.
One example of CO2 emission reduction activities was the fiscal 2020 switch to renewable energy for a portion of the electricity purchased at the Yamaha Corporation headquarters. In April 2021, we transitioned completely to renewable energy at our headquarters, and we are planning a phased increase in the portion of electricity purchased from renewable sources at other bases going forward.
In addition, we are actively promoting the use of certified timber, and the ratio of certified timber use (volume ratio) was 28% in fiscal 2020 and 48% in fiscal 2021. In addition, the medium-term management plan announced in April 2019 set the goal of achieving a 50% ratio of certified timber use by fiscal 2022, and smooth progress is being made toward achieving this target.