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Sustainability
(Key performance indicators: non-financial performance included) - Split PDF
CONTENTS
Sustainability
Our material issues
To help the JT Group to grow, and to build a sustainable future as a member of the society in which we operate, we have identified a list of high-priority material issues. Our materiality is based on the JT Group’s management principle, the 4S model. In 2015, we performed a materiality assessment covering the entire Group for the first time. We selected our material issues through interviews with our internal and external stakeholders.
Since we first selected our original material issues, external circumstances and the business environment in which we operate have changed. In 2021, we began updating the Group’s materiality framework by revisiting and identifying our material issues. With this in mind, external and internal stakeholders are being consulted to prioritize our new materiality topics.
In updating our materiality, there are several issues we are paying particular attention to: the rise and growth of RRP (Reduced-Risk products); the increasing global awareness to combat climate change; impacts of the COVID-19 pandemic, the progress of information technology; greater diversity in the workplace; regulatory trends such as the revision of Japan’s Corporate Governance Code, to name but a few. We also recognize the importance of creating new shared value, together with our stakeholders. Taking these factors into consideration, as well as the ESG issues facing our Group, we will set out our new materiality.
Overview of the sustainability strategy
The JT Group’s sustainability strategy is based on the 4S model, our management principle, and encompasses our materiality analysis. The foundations of our sustainability strategy, which apply across the Group, are outlined below. In 2021, we updated our JT Corporate Governance Policy and the Group Environment Plan 2030, which includes a commitment for a net zero target.
Three absolute requirements for sustainability
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Respect for human rights
We are committed to respecting human rights across our global operations and value chains, as expressed in the JT Group Human Rights Policy.
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An improved social and environmental impact
We are committed to protecting the environment and making a positive difference wherever we operate.
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Good governance and business standards
We are committed to promoting transparent, fair, and timely decision-making that carefully considers the respective interests of consumers, shareholders, employees, and the wider society.
Focus areas by business segments
We have identified priority areas, aspirational goals and targets for each business segment. As JT Group Environment Plan 2030 was updated, greenhouse gas emission targets of all of our business segments were also updated.
Tobacco business
We have selected the following four focus areas for tobacco, our core business. In 2019, we set out 11 specific targets covering each focus area and have been reporting on progress. In 2020, we set a new target relating to the appropriate use and responsible disposal of materials, including plastics, used in our products and packaging. As a result, a total of 12 targets are in place.
| Focus areas | Aspirational goals |
|---|---|
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Products and services |
We will be a total tobacco company offering consumers* an even greater choice of products by focusing on quality, innovation, and reduced-risk potential. |
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People |
We will be the employer of choice by investing in people. |
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Supply chain |
We will reduce environmental and social risks, and enable transparent and responsible practices across our supply chain. |
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Regulatory environment and illegal trade |
We will ensure the Company is included in policymaking leading to fair and balanced regulation, and enhance our cooperation with governments to combat illegal trade. See "Optimizing the regulatory environment and tackling illegal trade" for details |
* Adult consumers. Minimum legal age for smoking varies in accordance with the legislation in each country.
Pharmaceutical business
The mission of our pharmaceutical business is to create innovative, original drugs to support patients in the shortest time possible. In view of this mission, in 2019, we selected the following three focus areas. We subsequently set five specific targets for these focus areas.
| Focus areas | Aspirational goals |
|---|---|
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Products and services |
We will create innovative, original drugs to support patients in the shortest time possible. |
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People |
We will strive to nurture talent development which enables us to create first-in-class (FIC) drugs. |
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Product safety and responsibility |
We will strictly comply with all relevant laws, regulations, and industry standards in order to deliver safe drugs to patients. |
Processed food business
The processed food business comprises three businesses : frozen and ambient food, seasonings and bakery businesses. Our mission is to deliver safe, high-quality food to our consumers. In 2019, we selected the following three focus areas. We subsequently set eight specific targets for these focus areas.
| Focus areas | Aspirational goals |
|---|---|
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Products and services |
We will continue to provide high-quality, technology-driven products in response to our customers’ needs: satisfaction and trust. |
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People |
We will ensure workplace safety for our employees, while continuously investing in people who can contribute to enhancing corporate value. |
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Supply chain |
We will reduce social and environmental impacts and continue to deliver safe products to consumers. |
Contributing to the SDGs
The JT Group supports the Sustainable Development Goals (SDGs) adopted by the United Nations. Through our business activities, we will contribute to the SDGs related to our business and its environment. We have mapped related SDGs against our initiatives for sustainable business, and identified the nine SDGs to which our business can best contribute.
Sustainability Advisory Forum
Since 2020, we have held regular Sustainability Advisory Forums to discuss the Group’s sustainability issues. With our Chief Sustainability Officer acting as Chairman, the forum is attended by heads of the JT Group’s businesses and corporate functions. In 2021, three forums were held. We discussed and shared information on a number of sustainability issues such as updating the Group’s materiality, progress of the sustainability strategy, action against climate change or diversity and inclusion. Discussions at the forum are appropriately reported to the CEO and board of directors.
“ In the processed food business, we seek to provide safe and delicious food for consumers, in the hope that they will choose our products for their loved ones. Through our three businesses of frozen ambient food, seasonings, and bakery, we are working on our sustainability issues. I have participated in the forum since its inception. While being conscious of sustainability trends or regulatory developments and the challenges that we face, the forum serves as a place to discuss the Group-wide sustainability issues.”
Hiromasa Furukawa
Senior Vice President
Food Business
Stakeholder engagement
It is paramount that we regularly engage with our stakeholders, striving to create value for the wider society. Stakeholder engagement is essential for the Group’s sustainable growth. Our 4S model is the foundation of our management principle. In accordance with this principle, we communicate with a diverse group of stakeholders every day.
Key performance indicators
Non-financial performance review
2021 sustainability highlights
We continuously revisit the material issues of our Group, while striving to achieve our aspirational goals. Summarized here are some of our sustainability achievements and progress. It is paramount that we continue to monitor and report on our strategy, initiatives, goals, and progress. By assessing the impact, not only on our Group but on our value chain as whole, we wish to create shared value for our planet and the communities in which we operate.
We announced our commitment to accelerate our efforts to reduce greenhouse gas (GHG) emissions across the entire value chain and achieve net zero GHG emissions by 2050. We aim to be carbon neutral for our own operations by 2030. Among other initiatives, we plan to achieve this by increasing the proportion of renewable electricity that we use.
To coincide with the 10th anniversary of the United Nations Guiding Principles on Business and Human Rights, we have published our first Human Rights Report. The report explains our approach to human rights’ due diligence based on the JT Group Human Rights Policy. It also identifies nine salient human rights issues and the steps we are taking to remedy them.
Corporate governance is one of the key priorities of our Group and we work proactively to fulfill this requirement. In our latest Corporate Governance Report, we introduced a skills matrix for the Directors and Members of the Audit & Supervisory Board. For the sustainable growth of our Group, we are introducing an ESG-related index for director remuneration, starting from FY2022.
In 2021, JTI received EY’s Global Equality Standard certificate, as one of the first multinational companies in the world. EY’s GES is one of the first worldwide Diversity & Inclusion (D&I) certifications measuring equal opportunities and equal pay in the workplace.
JT Group environmental performance data
As a global organization, we recognize that we have a key role to play in reducing our environmental impact – not only in our own business operations, but across our value chain. We will continue to measure performance across a range of environmental topics and set ourselves targets along the way.
CHG emissions Scope 1 and 2
(CO2e thousand tons)
CHG emissions Scope 3
(CO2e thousand tons)
Water with drawal
(Thousand m³)
Waste generated
(Thousand tons)
