CSR

Ongoing Environmental Protection Activities


Climate Change and Energy Consumption

We consider climate change our most critical environmental issue, have the Environmental Management Committee analyze and evaluate the risks and opportunities for our business due to climate change, and make pertinent efforts.


Analysis/Evaluation of Risks/Opportunities regarding Climate Change

Risk factor Term Description Impact Management approach
Regulatory risk Emissions reporting system Short-term Additional cost incurred to achieve energy consumption reduction mandated by laws and regulations. Increase in operating costs Formulation and implementation of a capital investment plan including high-efficiency equipment to replace current equipment
Uncertainty due to new regulations Long-term Increasing cost of raw materials in the case that new regulations on climate change are introduced and suppliers of raw materials follow them Increase in operating costs Indirect involvement in revisions to laws concerning the mitigation of climate change as a member of the Japan Pharmaceutical Manufacturers Association, an industry association. Investigation of modifications or other measures regarding purchasing procedures in case of procurement cost changes
Risk due to physical repercussions Changes in highest/lowest temperatures Medium-term Delay in research and development activities and negative impacts on product shipments in case of failure of temperature control caused by changes in the highest and lowest temperatures Increase in operating costs Pursuit of high efficiency, for example, by spraying water onto outdoor units of cooling equipment
Changes in precipitation patterns Medium-term Necessity of taking measures against possible shutdown of our operations caused by abnormal local weather such as strong wind and heavy rain Increase in operating costs Introduction of emergency power generators at main bases and periodic maintenance for them
Other risk Reputation risk Short-term Adverse effects on our stock price in case of negative external evaluations of our efforts made against climate change Decline in stock price Appropriate disclosure of the results of actual activities to the public

Opportunity factor Term Description Impact Management approach
Opportunity due to regulations Emissions reporting system Short-term Reduction of energy costs with measures implemented to achieve energy consumption reduction mandated by laws and regulations Reduction in operating costs Formulation and implementation of a capital investment plan including high-efficiency equipment to replace current equipment
Opportunity due to physical effects Changes in average temperature Medium- to long term In case of changes in prevalent diseases due to an increase in average temperature, an increase in demand for existing pharmaceuticals against such diseases, or favorable effects on our profits from developing and selling new drugs Increase in demand for existing products/services
New products/services
Increase in efficacy of existing pharmaceuticals
Enhancement of new compound library
Other opportunity Reputation opportunity Short-term Positive impact on stock price in case of more positive external evaluation of our responses to climate change Rising stock price Appropriate disclosure of the results of actual activities to the public

* We respond to the CDP climate change survey on the risks, opportunities, etc. from climate change.



Energy Saving and Global Warming Prevention

Working on energy conservation and power-saving measures at all our sites, we are making various efforts to control the greenhouse gas emissions generated by our business activities, aiming to achieve two goals: our medium-term environmental target, gto reduce CO2 emissions in FY2020 by 23% or more from that in FY2005 (the target is energy-derived CO2 emissions released from production and research sites),h and our short-term target, gto reduce the energy consumption factor at production and research sites by 1% from the previous fiscal year (the number of boxes produced is used as a denominator for calculating the factor).h In FY2017, CO2 emissions from our production and research sites were 24,000 tons and decreased by 10.1% compared to 26,700 tons in FY2005.



* We have been designated as a specified business stipulated in the Act on Rationalizing Energy Use (Energy Saving Act) and annually report on our energy consumption and mid- to long-term consumption reduction plan to the Ministry of Economy, Trade and Industry and the Ministry of Health, Labour and Welfare. In FY2016, the Business Classification Evaluation System was enacted pursuant to the Energy Saving Act, and Ono Pharmaceutical received a rating of S, which is the highest ranking, for two consecutive years, as a high-quality business with progress in energy-saving efforts.


Energy-derived CO2 Emissions

Note: Sites where CO2 emission data were collected: Fujiyama Plant, Joto Plant, Minase Research Institute, Fukui Research Institute, Tsukuba Research Institute, Head Office, sales offices, etc.
CO2 emissions are calculated according to the methods below.
CO2 emissions = Purchased electricity (10,000 kWh) x the Federation of Pharmaceutical Manufacturersf Associations of Japan tracking indicator (1.152 tons-C/10,000 kWh) ~ 44 / 12+ (Fuel consumption ~ Unit calorific value ~ Carbon emission indicator ~44 / 12)
We use the value of the Warming Countermeasures Act as the calorific power unit and carbon emission indicator. However, we use the Federation of Pharmaceutical Manufacturersf Associations of Japan tracking indicator (FY2005 values) as the electricity CO2 emissions volume calculation. This is to enable proper evaluation of ONOfs initiatives, after removing the effect of external factors such as nuclear power plant operation status.
The figures in the base year and the target value are those in the production and research sites.



Break down of energy-derived CO2 emissions by scope



Energy Consumption

Note: Sites where energy consumption data were collected: Fujiyama Plant, Joto Plant, Minase Research Institute, Fukui Research Institute, Tsukuba Research Institute, Head Office, Tokyo Building, sales offices, etc.



1) Various efforts made for energy conservation and reducing greenhouse gas emissions

As efforts for energy conservation and reducing greenhouse gas emissions, we took proactive measures in FY2017 such as updating our lighting from fluorescent lights to LEDs, updating heat source equipment to module-type heat pump chillers, and acquired a rating of S under CASBEE® with the New Tokyo Building built in March 2018 by introducing the latest energy-saving equipment.
Meanwhile, we are promoting efforts in both tangible and intangible ways, such as reviewing/adjusting the operating hours of facilities and implementing Cool Biz and Warm Biz. We will continue our efforts for energy conservation and reducing greenhouse gas emissions through measures such as adopting Top Runner Equipment and considering the introduction of renewable energy when updating old equipment.

CASBEE

* CASBEE (Comprehensive Assessment System for Built Environment Efficiency) is a method for evaluating and rating the environmental performance of buildings. It is a system that comprehensively evaluates the quality of buildings including not only environmental consciousness, such as energy conservation and the use of environmentally friendly materials, but also the consideration of indoor comfort and the buildingfs influence on the landscape.


EIncorporating Renewable Energy

Solar power, a form of renewable energy, is an effective way to reduce greenhouse gas emissions, since it does not need to release any when generating electricity. We introduced solar power generation facilities in our headquarters building in FY2003, the Minase Research Institute in FY2015, and the New Tokyo Building in FY2017.


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Solar panels at the Minase Research Institute Solar power monitoring system at the Minase Research Institute


EFuel-Related Initiatives

By switching from fuels such as heavy oil and kerosene to utility gas and natural gas (LNG), the same amount of energy can be obtained but with fewer CO2 emissions. Therefore, switching to these cleaner fuels results in fewer greenhouse gas emissions.
In our plants and research institutes, we are trying to reduce CO2 emissions by replacing heavy oil / kerosene with city gas and LNG. All fuels were converted to city gas or LNG at other bases that used to use heavy oil and kerosene by the end of FY2013.


EPower Load Leveling

In Japan, due to stoppages of nuclear power plants, the revised Energy Saving Act, which went into effect in FY2014, included provisions for cutting peak electricity usage in the summer and winter\a process known as power load leveling. We have been promoting electricity demand leveling by implementing a peak shift from daytime electricity use with a nighttime heat storage system at major bases and modifying the method of heating water for air conditioning (switching from air-cooled chillers to steam boilers), in addition to implementing seasonal energy-saving measures (suspension of use of hot-water toilet seats, water heaters, and some lighting) across the company. The Fujiyama Plant uses a cogeneration system (CGS) to generate power for its daily needs, thus easing the amount it needs to obtain from the electric power utility.


EEnergy Management

In order to successfully carry out measures to achieve energy efficiency and power load leveling and to reduce CO2 emissions, it is helpful to gather data on energy usage from various facilities, analyze them, and use them to reduce and adjust the load. Through a monitoring system, graphs and flow charts are used to put data into an easy-to-grasp form so that the data can be used in the most effective way.
While the production sites and the research institutes have conventionally measured energy use, we are gradually moving ahead with upgrading our energy management systems, which includes the possible adoption of a comprehensive FEMS (factory energy management system) and a BEMS (building energy management system).



2) CO2 Emissions in the Value Chain (Scope 3)

ONO divides CO2 emissions in the value chain (Scope 3) into 15 categories under the Ministry of the Environmentfs guidelines, and since FY2014 it has been calculating them for sites in Japan. Based on the identification of Scope 3 emissions, we will consider concrete measures to realize a low-carbon society.



Category FY2016 emissions (10.0 thousand tons-CO2) FY2017 emissions (10.0 thousand tons-CO2) Calculation method Notes
Purchased goods and services 9.71 10.56 Purchase cost of raw materials, materials, etc., multiplied by emission factor* Covers production and research sites
Capital goods 2.70 5.26 Amount of capital investment, multiplied by emission factor* -
Fuel- and energy-related activities not included in scope 1 or scope 2 0.15 0.15 Amount of electricity purchased, multiplied by emission factor* -
Upstream transportation and distribution 0.01 0.01 Transport data on deliveries from ONO factories and distribution centers to destinations, multiplied by emission factor* -
Waste generated in operations 0.03 0.03 Weight of each type of industrial waste generated, multiplied by emission factor* -
Business travel 0.22 0.25 Business trip allowances, multiplied by emission factor* Covers travels by airplane or Shinkansen bullet train
Employee commuting 0.03 0.04 Employees’ commuting costs, multiplied by emission factor* -
Upstream leased assets 0.35 0.35 Cost of gasoline for leased company cars, multiplied by emission factor* -
Downstream transportation and distribution 0.62 -** CO2 emissions stated in ONO’s CSR report on major wholesale pharmaceuticals, multiplied by percentage of ONO net sales included in all net sales of major wholesale pharmaceuticals **No calculations made for FY2015, because at the time of calculation ONO’s major wholesale pharmaceuticals CSR report had not been released
Processing of sold products Not calculated Not calculated - ONO makes only finished products
Use of sold products Not calculated Not calculated - No energy is consumed during the use of ONO products
End-of-life treatment of sold products 0.02 0.01 Weight of each type of ONO product container or packaging disposed of as waste, multiplied by emission factor* -
Downstream leased assets 0.03 0.03 Floor space of asset (building) owned and rented out categorized by use, multiplied by emission factor* -
Franchises Not calculated Not calculated - ONO does not operate franchises
Investments Not calculated Not calculated - -

* Figures stated in the gEmission Factor Database on Accounting for Greenhouse Gas Emissions throughout the Supply Chain (ver. 2 .4),h published by the Ministry of the Environment, Government of Japan.

Water Resources

Availability of high-quality fresh water is one of the important factors for us in conducting business activities. The Environmental Management Committee leads and conducts surveys on risks, and identifies/analyzes/evaluates the business risks. Although our plants and research institutes in Japan have never experienced restrictions on using good-quality fresh water so far and the risk of trouble related to using such water is considered low under the current circumstances, we identify and evaluate potential impacts and consider countermeasures, in case water quality deterioration or a water shortage occurs due to global environmental changes caused by climate change in the future or the regulations on drainage are reinforced.


Major water risk factors Potential impacts of the risks
Restrictions on use of good-quality fresh water / water shortage Making us unable to use good-quality fresh water, leading to restrictions on activities for production and research
Water quality deterioration Increasing costs for installing purification equipment to improve water quality
Flooding / disasters such as heavy rainfall Causing flood damage to facilities due to flooding from the rivers around our offices and heavy rainfall


Efforts Made for Reducing Water Use

In newly constructed facilities at office buildings, research sites, plants, and other sites, we use water-saving sanitary equipment. For existing buildings, we are also making efforts for reducing water use, such as installing water-saving washers in faucets. In addition, a recycled water system has been installed at the Fukui Research Institute, and the annual water use there is 18,167 m3, which is 5.9% of our total water use.


Water use

* Facilities covered in the collection of water usage data: Fujiyama Plant, Joto Plant, Minase Research Institute, Fukui Research Institute, and Tsukuba Research Institute.


We respond to the CDP water survey on the details of water risks, impact, usage, wastewater volume, etc.


Waste


Waste Management

We promote company-wide initiatives to reduce the amount of industrial waste landfilled. The final landfill disposal amount for industrial waste in FY2017 was 7.4 tons, 1,055.7% of that in the previous fiscal year. This was a temporary increase due to renovation work on the investigational drug-related facilities carried out at the Joto Plant. We will promote the reduction of landfill waste.


EEfforts made for reducing waste

We are endeavoring to reduce the amount of waste generated by separating and recycling waste based on our waste management regulations and waste separation rules. Observation at the intermediate waste treatment facilities and landfill sites run by waste treatment subcontractors are also conducted periodically to ensure our companyfs waste is being disposed of appropriately.
To meet the target of recycling all industrial waste, we also conduct thermal recycling with certified heat recovery operators and use landfill sites where material recycling is performed. We achieved zero emissions* again in FY2017 and will make efforts to continue to achieve zero emissions.


Industrial waste: Amount of the waste generated/landfilled


* Sites where data on industrial waste (amount of waste generated/landfilled) was collected: Fujiyama Plant, Joto Plant, Minase Research Institute, Fukui Research Institute, Tsukuba Research Institute




Notes:

* Zero emissions means a final disposal rate (percentage of waste that is landfilled) of less than 1.0%, because industrial waste generated is recycled (calculation of final disposal rate: final landfill disposal amount / amount of waste generated ~ 100). Note that we have not achieved zero emissions for certain materials, such as some hazardous substances and reagent waste, because their safe disposal is a higher priority.

Recycling containers and product packaging

Pursuant to the Containers and Packaging Recycling Law, some of the containers and packaging materials for the products we sell are recycled. In addition, we are working to reduce our environmental impact by changing the materials in our containers and changing the designs of our packaging.


FY2017

(Unit: tons)

Container and packaging usage Obligatory recycling amount
Plastic 164.7 34.7
Paper 192.0 1.6
Glass (colorless) 0 0
Glass (brown) 0.3 0
Commissioning fee paid for recycling: 1,723 thousand yen

Prevention of Air Pollution and Water Pollution

The production sites comply with the Japanese Air Pollution Control Act, the PRTR Law, agreements on pollution prevention with local governments, and other related laws and regulations in order to reduce environmental impact. They periodically measure the concentration of exhaust gas and noise from boilers and CGSs as well as wastewater from the plants, in accordance with related laws and other regulations, in order to ensure that levels are within regulatory limits. They also strive to reduce environmental risk. The PDCA cycle is followed in the plants, and employees are provided with the necessary environmental management training in operations in which there is a risk of environmental impact. Emergency drills are also conducted regularly. These drills use scenarios such as high concentrations of soot due to faulty equipment and leakages of oil into the ground, giving employees practice in the necessary preventative and responsive measures for such situations.
In recent years, extreme weather events are occurring as a result of global warming. We have formulated manuals to prepare for accidents and emergency situations caused by such weather, and we organize training sessions to minimize environmental impacts. In particular, to address any accidents and emergency situations that may cause water or soil pollution, we systematically review and implement the backup and reinforcement of relevant equipment.


Management of Chemicals

ONO is committed to reducing chemical emissions to the lowest possible level not only in compliance with laws and regulations but also in recognition that these emissions may impact human health and the ecosystem.


ECompliance with the PRTR Law

In FY2017, the Minase Research Institute and the Joto Plant made reports on Class I designated chemical substances. These chemicals are managed in appropriate amounts and in compliance with the PRTR Law.


Compliance with the PRTR Law

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EAmount of Chemical Substances Handled

In FY2017, as in FY2016, the volume of Class I designated chemical substances under the PRTR Law that we handled remained extremely low, at just 11.95 tons. This is partly because ONO does not conduct any synthesis of pharmaceutical substances. We will continue to make every possible effort to reduce the amount that we handle and to keep down the amount released.


EHandling of PCBs

ONO manages waste polychlorinated biphenyls (PCBs) properly in accordance with the Law Concerning Special Measures for Promotion of Proper Treatment of PCB Waste in Japan. The company submits a report on the storage and disposal of waste PCBs to the Osaka municipal government every year.


Site Status Type Number of units
Joto Plant Stored Fluorescent lamp 552
Disposed* Condenser 6
Minase Research Institute Disposed* Condenser 2

* The Joto Plant in FY2007 and the Minase Research Institute in FY2014 delivered PCBs to the Japan Environmental Storage and Safety Corporation, a PCB waste treatment service provider.


EFluorocarbon Management

In April 2015, amendments to the Act on Rational Use and Proper Management of Fluorocarbons came into force, and the reporting of leakage from and inspection of air conditioning equipment and refrigerators/freezers for business use became obligatory. Therefore, we conduct activities such as the identification of such equipment, simple inspections / periodic inspections, generation of records, and calculations of leakage. In FY2017, the calculated leakage of fluorocarbons was 197.9 tons-CO2. We will continue to prevent leakage and promote the introduction of non-CFC (chlorofluorocarbon) and low-GWP (global-warming potential) equipment when updating equipment.

Green Purchasing

In December 2004, we started purchasing on a company wide basis-from @office, an online office supply purchasing service provided by Kokuyo Co., Ltd. This service offers a wide range of environmentally friendly office supplies, including Green Mark and Eco Mark certified products, and we use this service to promote green procurement. In FY2017, 80% of the office supplies purchased by ONO were environmentally friendly products.

 

Independent Practitioner's Assurance

As for the categories of environmental information (energy-derived CO2 emissions, energy consumption, CO2 emissions in the value chain (Scope 3), water resource input, water resource emissions, and industrial waste: amount of waste generated/landfilled), each of which is disclosed and indicated with the icon check in our CSR Report 2018, we have received independent assurance so as to bolster the reliability of the information. The Independent Assurance Report is reprinted on page 65.