CSR / Environment

Climate Change

Sharp’s Stance on Climate Change

Extreme weather in recent years, presumably attributable to climate change, have led to an increasing number of natural disasters throughout the world. Among natural disasters, typhoons, hurricanes, localized torrential rains, and floods in particular can cause devastating damage to people’s lives and businesses.

The major cause of climate change is believed to be global warming resulting from the increasing concentrations of CO2 and other greenhouse gases (GHGs) on the Earth. Against this background, the Paris Agreement came into force in November 2016, setting the target of keeping the global temperature rise below 2°C above pre-industrial levels and calling for efforts to limit warming to 1.5°C. The agreement even stipulates the aim of reducing GHG emissions to essentially zero by the second half of this century.

To support these GHG emission reductions, we announced SHARP Eco Vision 2050. This long-term environmental vision sets forth two key goals to reach by 2050: to create more clean energy than the total amount of energy consumed in Sharp’s entire supply chain and to achieve net zero CO2 emissions in Sharp business activities. We have already embarked on initiatives to achieve them.

Sharp recognizes the material effects that climate change can have on our business in terms of risks and opportunities. We are preparing to disclose climate-related information in accordance with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) established by the Financial Stability Board (FSB).

Sharp’s Approaches to GHG Emission Reduction

Sharp mainly takes the following two approaches for the reduction of GHG emissions.

Reducing GHG emissions by curbing energy consumption in business activities

  • Quantifying and analyzing energy consumption and GHG emissions from business activities
  • Reducing GHG emissions through productivity improvements and energy cost reductions at factories
  • Reducing GHG emissions by using renewable energy
  • Reducing GHG emissions during transportation by switching to more eco-friendly transportation modes

Reducing CO2 emissions by creating environmentally conscious products

  • Quantifying and analyzing GHG emissions throughout the product life cycle
  • Reducing GHG emissions during use of products by improving the energy-saving performance of products
  • Reducing GHG emissions through the provision of conducive products and services (e.g., solar power systems and storage batteries)
  • Reducing GHG emissions by offering smart life/office services incorporating AIoT devices and cloud technology

Disclosure of Climate-Related Information

Action on the TCFD Recommendations

The Task Force on Climate-related Financial Disclosures (TCFD) was established by the Financial Stability Board (FSB), an organization promoting international financial stability. In 2017 the TCFD released recommendations for companies to disclose information on the risks and opportunities of climate change. Sharp is expanding disclosure of climate-related information in accordance with the framework set by the TCFD.

1. Governance

We have established a Sharp Global SER Committee to drive corporate climate actions. The Sharp Global SER Committee ensures that specific measures are implemented in accordance with the guidelines and KPIs set every year regarding risks and opportunities in the climate change field in line with the long-term environmental vision. It is also responsible for initiating further improvements and new measures by carrying out the PDCA cycle involving evaluating progress and discussing actions to be taken on a quarterly basis, as well as reporting to senior executives as appropriate.

2. Strategy

Climate-related risks and opportunities can be divided into two major categories: those associated with the transition to a decarbonized economy, such as tighter regulations, technological advancement, and changes in the market; and those associated with physical changes arising from global warming, such as acute extreme weather events and chronic temperature rises. We recognize that these risks and opportunities are related to Sharp’s business as follows.

Category Relation to Sharp’s Business
Risks Transition Policy and legal Increased operational costs and burdens due to policy changes, tighter regulations (a major rise in the carbon tax rate), stricter energy-saving standards for products, etc.
[Action]
Comply with existing regulations and standards, stay informed on the latest legal and regulatory developments, and take advantage of policymaking opportunities
Physical changes Acute Business continuity risks associated with delayed production and the loss of sales opportunities due to production shutdowns and disrupted material procurement in the wake of increased or intensified natural disasters (e.g., typhoons and floods)
[Action]
Shore up facilities at sites vulnerable to flood hazards, secure diversified procurement sources, and prepare disaster response manuals
Opportunities Transition Products and services Wider use of solar power systems and storage battery systems that contribute to climate change mitigation and adaptation, and growth of the business dealing with AIoT technology and related devices and products that meet the increasing demand for energy-efficient products
Physical changes Products and services Expansion of the social innovation business that enables efficient management of energy conservation and generation through integration of AIoT technology to combat natural disasters

3. Risk Management

Sharp has formulated the Rules of Business Risk Management as a basic approach to risk management. In accordance with the Rules, we have classified climate-related risks as “specific risks” that could have a major impact on management, and manage and assess them together with the rest of the specific risks.

4. Metrics and Targets

Under its Basic Environmental Policy of “Creating an Environmentally Conscious Company with Sincerity and Creativity,” Sharp has formulated SHARP Eco Vision 2050, a long-term vision with 2050 as the target year. In the climate change field, in particular, our vision sets forth two long-term goals regarding GHG emission reduction in line with the 1.5°C target of the Paris Agreement: to create more clean energy than the total amount of energy consumed in Sharp’s entire supply chain and to achieve net zero CO2 emissions in Sharp business activities. To reach these long-term goals, we are committed to developing and delivering environmentally conscious products and services and introducing more energy-saving technologies and renewable energy to our factories. To accelerate our efforts toward the long-term environmental vision, Sharp is formulating medium-term environmental goals that define specific activities and quantitative targets in its climate change action.

Greenhouse Gas Emissions Based on the GHG Protocol Initiative

Sharp calculates greenhouse gas emissions based on the GHG Protocol*1 and then works to limit those emissions resulting from customer use of Sharp products and from Sharp’s business activities, including those in the supply chain.

  • *1 The GHG Protocol is an international standard for calculating greenhouse gas (GHG) emissions. It was jointly established by the World Business Council for Sustainable Development (WBCSD), a coalition of the world’s leading companies, and the World Resources Institute (WRI), a United States-based think tank.

Greenhouse Gas Emissions by Scope 1/2/3 Categories Based on the GHG Protocol Initiative (Fiscal 2019)

Category Emissions
(Thousand Tons CO2)
Notes
Scope 1
(direct GHG emissions from business activities)
252 Emissions from combustion of fuel, etc.
Scope 2
(indirect GHG emissions from energy usage in business activities)
722 Emissions from the use of electricity
Total of Scope 1 and Scope 2 974
Scope 3 (indirect GHG emissions from outside the scope of business activities) 1. Purchased goods and services 3,184 Emissions from the manufacture of materials procured for products in the 8 major categories*2 that the Sharp Group sold in the reporting year
2. Capital goods 164 Emissions from the construction, manufacture, and transportation of Sharp Group capital goods (such as equipment, machinery, buildings, facilities, and vehicles)
3. Fuel- and energy-related activities (not included in Scope 1 or 2) 144 Emissions from the procurement of fuels (natural resource extraction, manufacture, and transportation) consumed in the generation of electricity and heat the Sharp Group procures from other companies
4. Upstream transportation and distribution 210 Emissions from the transportation of Sharp Group parts and materials and products manufactured
5. Waste generated in operations 2 Emissions from waste disposal and treatment by the Sharp Group
6. Business travel 8 Emissions from business travel by all employees of Sharp Corporation
7. Employee commuting 10 Emissions from commuting by all employees of Sharp Corporation
8. Upstream leased assets Included in Scope 1 and 2 CO2 emissions
9. Downstream transportation and distribution 31 Emissions from the transportation (from retailers to end consumers) of products in the 8 major categories*2 that the Sharp Group sold in the reporting year
10. Processing of sold products 70 Emissions from processing at destination of Sharp Group products
11. Use of sold products 28,438 Emissions*3 from the use of products in the 8 major categories*2 that the Sharp Group sold in the reporting year
12. End-of-life treatment of sold products 3 Emissions from recycling 4 types of appliances*4 that Sharp Corporation sold in Japan
13. Downstream leased assets Not applicable
14. Franchises Not applicable
15. Investments Not applicable
Scope 3 total 32,265
Scope 1 + 2 +3 total 33,239
  • *2 LCD TVs, air conditioners, refrigerators, washing machines, air purifiers, microwave ovens, copiers/MFPs, solar cells
  • *3 Annual power consumption of each product × number of units sold × product life × CO2 emission coefficient
  • *4 TVs (CRT TVs, flat-panel TVs), air conditioners, refrigerators/freezers, washing machines/dryers

Curbing Business Activity-Linked Greenhouse Gas Emissions

Fiscal 2019 Objectives Fiscal 2019 Achievements Self-Evaluation
  • ■ Energy intensity: Improve by 20%
    (baseline year: fiscal 2012)
  • Improved by 18%
    (baseline year: fiscal 2012)
Priority Objectives for Fiscal 2020
  • Energy intensity: Improve by 20%
    (baseline year: fiscal 2012)
  • Self-evaluation: ★★★ Achieved more than targeted / ★★ Achieved as targeted / ★ Achieved to some extent

Sharp Group Activities to Control Greenhouse Gas Emissions

Sharp is taking active measures to curb greenhouse gas (GHG) emissions resulting from its business activities in an effort to contribute to the realization of a decarbonized society. The Sharp Group’s GHG emissions from business activities in fiscal 2019 decreased by 9.6% to 974,000 tons CO2compared to the previous fiscal year thanks to efforts such as transferring manufacturing to more efficient plants and consolidating production bases. The improvement rate of energy intensity was 18%, compared to the baseline year of fiscal 2012.

Each Sharp production base is strengthening efforts involving all equipment and systems—ranging from production lines to utility systems for supplying electricity, gas, and water—to boost energy efficiency and reduce GHG emissions. In particular, at the LCD and electronic component plants, the production, engineering, and environmental departments work together to reduce consumption of base-load energy. Efforts include installing inverters*1 and optimizing the air conditioning in clean rooms*2. Going forward, Sharp will pursue further energy-saving measures and boost production efficiency in line with its business expansion.

  • *1 A device to control the number of motor rotations.
  • *2 A room where the temperature, humidity, and cleanliness are kept at controlled levels.

Amount of GHG Emissions

Energy Intensity (Baseline Year: Fiscal 2012)

  • *3 HFCs, PFCs, sulfur hexafluoride (SF6), nitrogen trifluoride (NF3)

GHG Emissions by Region (Fiscal 2019)

Case Study

Mie Plant Wins ECCJ Chairman’s Prize at 2019 Energy Conservation Grand Prize for Thorough Energy Conservation Activities in LCD Manufacturing

Sharp’s Mie Plant (Taki, Mie Prefecture) was awarded the ECCJ Chairman’s Prize in the Energy-Saving Initiatives category at Japan’s 2019 Energy Conservation Grand Prize program for its thorough energy conservation activities in LCD manufacturing. Organized by the Energy Conservation Center, Japan (ECCJ) and supported by the Ministry of Economy, Trade and Industry (METI), this awards program recognizes best energy conservation practices and highly energy-efficient products and business models demonstrated by companies, their offices, and so forth. Its aim is to contribute to building an energy conservation society through the spread of energy conservation awareness and the diffusion of energy-saving products.

At the Mie Plant, small-group activities were conducted to pursue different energy conservation objectives, resulting in the achievement of a reduction in energy consumption equivalent to 1,319 kiloliters of crude oil a year. This also means that the plant used 1.4% less energy than it did in fiscal 2018. Sharp received this award for the second year in a row after its Kameyama Plant was honored in 2018.

Main Energy Conservation Measures

  • High-efficiency operation of deodorizer/scrubber*1
    The motor used for concentrating the VOCs*2 included in the exhaust from production equipment has been retrofitted with inverter*3 control to increase the concentration rate of the treated gases and achieve higher concentrations. This has resulted in less gas volumes and thus less use of LP gas for VOC combustion and a lower airflow requirement for the fan.
  • High-efficiency operation of chillers
    The load on the chiller has been lightened by using water warmed in the production process for the production of cold water needed for preventing cold water coils from freezing during winter.
  • Energy conservation of outdoor-air processing units
    Efforts to reduce exhaust have turned out to be more effective than expected at the time of plant design, resulting in the overcapacity of outdoor-air processing units used to take in outside air. Inverter control has been employed to adjust airflow volume.
  • Streamlined operation of wet-type chemical air-conditioning systems*4
    A reduction in water consumption and the optimization of the number of spray pumps have been achieved through a review of the concentration management of the water used for adsorbing contaminants.
  • High-efficiency operation of microbial wastewater treatment systems
    The aeration of the biological treatment tank*5 has been made adjustable to the load on each treatment system through the modification of the piping and the addition of inverter control.
  • *1 Equipment designed to clean harmful gases generated in the production process.
  • *2 Volatile organic compounds.
  • *3 Adevice designed to control the RPM of the motor.
  • *4 An air-conditioning system that removes airborne chemical contaminants in the cleanroom with pure water.
  • *5 Feeding air into the biological treatment tank to dissolve oxygen into the water.

Award certificate and Trophy

Utilizing Renewable Energy

Sharp has introduced PV systems to its domestic and overseas production bases and is advancing the use of renewables to do its part to create a decarbonized society. In fiscal 2019, Sharp generated 8.86 million kilowatt-hours of electricity. This is equivalent to the annual energy consumption amount*1 of roughly 3,000 average households in Japan. Sharp will continue to work hard at reducing carbon emissions even further in the future.

  • *1 Calculated from data from the Federation of Electric Power Companies of Japan

Solar power systems installed on the roofs of Sharp production bases (left: Kameyama Plant; right: NSEC in China)

Identifying and Reducing Environmental Impacts throughout the Life of Products

Sharp performs a life cycle*2 assessment (LCA) on its products to identify their impact on the environment throughout their service life. Converting this impact into CO2 emissions provides a quantitative measure that Sharp uses in its efforts to reduce environmental impacts.

Consumer electronics generally have a large impact on the environment during use. Thus, by focusing on improving their energy savings, overall environmental impact can be effectively reduced. For example, energy saving standards under Japan’s Energy Conservation Act were revised in 2016 for refrigerators, which consume a comparatively large amount of electricity. These tougher standards are aimed at improving energy savings towards the target year of fiscal 2021.

LCA Data for Refrigerators

  • *2 The life of a product from materials and parts procurement to manufacture, distribution, use, disposal, and recycling.
  • *3 CO2 emissions during use are calculated using a CO2 emission coefficient (adjusted) announced by Japan’s Electric Power Council for a Low Carbon Society (ELCS).
Case Study

Sharp Builds Mega Solar Power Plant in Quang Ngai Province, Vietnam

In May 2019, Sharp Energy Solutions Corporation (SESJ)*1 completed a mega solar power plant in Quang Ngai Province, Vietnam. The project was a collaboration with multiple partners, including Sermsang Power Corporation (SSP)*2 of Thailand, and SSP affiliate Truong Than Quang Ngai Power and High Technology Joint Stock Company*3.

The new plant has an output of approximately 49 MW-dc, with annual power generation capacity estimated at 73,143 MWh/year. This is equivalent to the amount consumed in a year by 38,762*4 average Vietnamese households. Sharp has so far constructed three solar power plants in Vietnam, for a combined capacity of approximately 146 MW-dc. This new plant raises the total capacity to approximately 195 MW-dc*5.

The mega solar power plant is well into operation

  • *1 SESJ is a subsidiary of Sharp Corporation, specializing in energy solutions such as the sales of PV systems and the installation of electrical equipment.
  • *2 SSP’s main business is constructing solar power plants in ASEAN countries.
  • *3 This company is in charge of operating the new plant.
  • *4 Calculated at 1,887 kWh per household.
  • *5 As of June 5, 2019.
Case Study

Sharp Installs Solar Power System on Rooftop of Yokohama Rubber*6 Tire Factory in the Philippines

In July 2019, Sharp Energy Solutions Corporation (SESJ) installed a solar power system on the rooftop of a production plant*7 run by the production and sales subsidiary of the Yokohama Rubber Co., Ltd. in Pampanga Province, the Philippines.

The solar power system has an output of approximately 4 MW-dc. The generated electricity is used within the tire factory, allowing the factory to reduce the amount of electricity it purchases from the grid. The tire factory’s environmental policy covers items such as the conservation of natural resources and the reduction of greenhouse gas emissions, which are the cause of global warming. The solar power system was installed as part of this policy. The estimated annual power generation capacity is approximately 5,363 MWh. This is equivalent to a reduction in greenhouse gases of roughly 2,858 t-CO2/year.

Yokohama Rubber tire factory

  • *6 The Yokohama Rubber Co., Ltd. manufactures tires, industrial products, sporting equipment, and other items.
  • *7 A tire factory operated by Yokohama Tire Philippines, Inc., a tire manufacturing and sales subsidiary of the Yokohama Rubber Co., Ltd.

Reducing Logistics-Related Environmental Impact

Fiscal 2019 Objectives Fiscal 2019 Achievements Self-Evaluation
  • Energy intensity:
    Improve by average of 1% each year (average for fiscal 2015 to 2019)
  • Energy intensity:
    Improved by average of 1% each year (average for fiscal 2015 to 2019
★★
Priority Objectives for Fiscal 2020
  • Energy intensity:
    Improve by average of 1% each year (average for fiscal 2016 to 2020)
  • Self-evaluation: ★★★ Achieved more than targeted / ★★ Achieved as targeted / ★ Achieved to some extent

Reducing the Environmental Impact of Logistics in Japan

Sharp observes a rule set forth in the Japanese Act on the Rational Use of Energy (Energy Conservation Act) that requires specified shippers to reduce energy intensity by 1% or greater per year. All Sharp Group companies in Japan are working to reduce the environmental impact and costs associated with logistics.

In fiscal 2019, Sharp Group greenhouse gas (GHG) emissions from shipping activities in Japan were down 5% from the previous fiscal year to 18,000 tons CO2. For Sharp Corporation, energy intensity was improved by an average of 1% for the most recent five years (fiscal 2015 to 2019). Sharp is steadily implementing a modal shift*1, a change from conventional trucking to more environmentally friendly modes of transport, such as shipping (non-international coastal trading vessels) and rail (Japan Railways containers). And, by unloading imported goods at harbors chosen for their proximity to their main sales locations, Sharp is reducing re-transport between distribution centers. These efforts enable Sharp to reduce the environmental impact of its distribution activities. For shipments, Sharp has been certified with an Eco Rail Mark*2 by the Ministry of Land, Infrastructure, Transport, and Tourism and the Railway Freight Association.

  • *1 To shift freight transport from conventional trucking to more environmentally friendly modes of transport, such as rail and shipping.
  • *2 Products or companies that use a certain amount of rail transport for freight are given Eco Rail Mark certification. The mark is used on items such as product packaging and brochures to inform the public that a company uses environmentally friendly modes of transport.

GHG Emissions from Freight Shipments (Japan)

Eco Rail Mark certification

Reducing the Environmental Impact of International Logistics

Sharp has a wide range of initiatives to reduce the amount of GHGs that are emitted as a result of international shipping. The company is reducing airfreight volume as it switches to environmentally friendly modes of transport, and it is also improving load efficiency. Further, it is reviewing shipping routes and switching to harbors that are closer to the final destinations for products. Sharp is also switching to suppliers located closer to its factories. In fiscal 2019, Sharp’s GHG emissions from international transport were 158 thousand tons CO2, an increase of 0.7% from the previous fiscal year.