Yokogawa Electric Corporation announces that it has set sustainability targets for its Accelerate Growth 2023 (AG2023) mid-term business plan. For the setting of these mid- and long-term indicators and targets, the company prioritized the issues that it will address to contribute toward the achievement of the United Nations’ Sustainable Development Goals (SDGs), and the issues that will reinforce the foundations for its sustainability management. As one outcome of this initiative, the Yokogawa Group will accelerate the reduction of its greenhouse gas (GHG) emissions and aim to achieve carbon neutrality by the year 2040.
Looking ahead to the year 2050, in 2017 Yokogawa set out its vision for the attainment of a low-carbon, recycling-oriented society in its “Three goals” for sustainability. In 2021, the company established Yokogawa’s Purpose, a statement that reads “Utilizing our ability to measure and connect, we fulfill our responsibilities for the future of our planet.” Given the close relationship that contributions to society and the environment have to the enhancement of Yokogawa’s corporate value, for the AG2023 plan that commences this fiscal year the company has prioritized issues for contributing toward the SDGs and issues that will reinforce the foundations for its sustainability management.
Setting of priority issues:
1. Priority issues for contributing toward the SDGs
Based on the conduct of a social / environmental impact analysis and a corporate value / business model impact analysis, Yokogawa has defined as follows six areas for contribution toward the SDGs and specified the issues to be prioritized in its business.
To address these priority issues, CO2 emissions avoided in customers’ businesses, the number of people whose health & safety have been enhanced and others have been set as social impact indicators for the years 2030 and 2040. To assist in the achievement of the targets that have been set for these indicators, business activity indicators have been decided for the year 2023. These indicators, which include sales growth rate for measuring instruments for renewable energy development and number of solutions provided for water environment improvement, will be incorporated in the annual management by objectives goals for all Group employees.
2. Priority issues for reinforcing sustainability management
To provide a stronger foundation for Yokogawa’s environmental, social, and governance (ESG) management, the company analyzed major ESG indicators and points to be improved, and identified the four priority issues of (1) climate change / greenhouse gases (GHG), (2) supply chains, (3) human resources / women’s empowerment, and (4) human rights. The responsible departments will employ ESG indicators as benchmarks to make improvements throughout the Group.
Efforts to achieve carbon neutrality by 2040
As one of the targets for its social impact indicators, Yokogawa aims to achieve a 100% reduction in its greenhouse gas emissions (Scope1 and Scope2*1) across the Group by 2040. The company will utilize internal carbon pricing to promote the use of CO2-free energy, and it will make the switch to electric vehicles. The company also plans to set targets for Scope3 emissions*2 and obtain SBT confirmation*3. GHG emissions in all business activities will be reduced by increasing the ratio of cloud and consulting services, visualizing each business’s energy efficiency, and promoting energy conservation.
President and CEO Hitoshi Nara commented, “We formulated Yokogawa’s Purpose and prioritized sustainability issues with the resolve to address social issues by utilizing our ability to measure and connect. By actively working to conserve energy and expand the use of renewable energy, we will contribute to carbon neutrality. In our efforts to drive forward the achievement of the SDGs around the world, we will continue working with our customers to transform and accelerate growth.”
*1 Scope1: Direct greenhouse gas emissions as a result of own business activities. Scope2: Indirect emissions from the use of electricity, steam, heat, and cooling supplied by other companies
*2 Scope3: All other indirect emissions that occur in a company’s supply chain
*3 Verification of greenhouse gas emissions reduction targets utilizing science-based targets, namely, the emissions reduction needed to meet the goals of the Paris Agreement (to hold the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels). The verification is carried out by the SBT Initiative, an international environmental organization.