Climate change is an urgent global challenge, and hardware manufacturing is not exempt from its impact.
In response to this issue, the Task Force on Climate-related Financial Disclosures (TCFD) was established in 2015 to help companies assess and disclose the financial risks and opportunities associated with climate change.
However, hardware companies face specific challenges in supporting TCFD compliance, which include:
Limited understanding of climate risks: Hardware companies may need more expertise in identifying and assessing climate-related risks, particularly those unique to the industry.
Data management challenges: Hardware companies may have significant and complex supply chains. It can be difficult to track emissions and assess their carbon footprint accurately.
Limited tools and resources: Hardware companies may need access to the tools and resources needed to measure and report climate-related risks and opportunities, mainly if they are small or mid-sized businesses.
Limited investor demand: It can be difficult for these companies to justify the cost and effort required to support TCFD compliance.
Lack of regulatory guidance: Some hardware companies may need help to navigate the complex and rapidly evolving regulatory landscape around climate risk reporting. This can make it challenging to ensure compliance with TCFD guidelines and other relevant regulations.
One company that has taken a proactive approach to address climate change is Ricoh Co., a global company committed to sustainability.
Ricoh conducted a scenario analysis to identify and evaluate climate-related risks and opportunities. In doing so, they assessed their business impact and implemented countermeasures based on TCFD compliance. As a result, Ricoh was better equipped to address potential challenges and capitalize on potential opportunities in the face of climate change.
To conduct a scenario analysis, Ricoh first assessed the importance of climate change-related risks. Next, they identified two extreme scenarios: the 2°C/1.5°C and 4°C scenarios. After that, they evaluated the possible business impacts of the risks. Identified opportunities and consulted with internal stakeholders to estimate the economic impact. Based on this evaluation, they placed the risks in the priority management risk category. After that, they planned and executed specific measures.
Ricoh has also set ambitious environmental goals for a “63% reduction in Scope 1 and 2 GHG emissions in 2030 compared to 2015”, which is certified as “SBT1.5°C” level by the International Climate Change Initiative SBTi (Science Based Targets Initiative).
To achieve this goal, they have formulated a roadmap to reduce GHG emissions by 2030.
Additionally, they are promoting specific energy-saving activities. Also, actively utilizing renewable energy. Furthermore, they became the first Japanese company to participate in “RE100”. It is a global initiative to convert electricity to renewable energy by 100%.
Companies can take countermeasures to neutralize GHG emissions that exceed the reduction limits set for 2050. These countermeasures include offsetting the residuals of Scope 1 and 2 through internationally recognized methods, such as forest absorptions/afforestation effects. Additionally, they can contribute to reductions that exceed the number of emissions for the residual amount of Scope 3.
Ricoh’s efforts to address climate change challenges demonstrate the importance of understanding climate-related risks and opportunities. It also reflects the need for companies to take proactive steps towards sustainability. By promoting specific energy-saving activities and actively utilizing renewable energy, Ricoh is leading the way in reducing greenhouse gas emissions and supporting TCFD compliance. Their scenario analysis and implementation of countermeasures can serve as a model for other companies looking to address climate change challenges.
In conclusion, climate change is an urgent issue. It requires global cooperation and proactive actions from businesses. Therefore, companies must identify and assess climate-related risks and opportunities to support TCFD compliance and take specific measures to address them. Ricoh’s efforts to reduce GHG emissions, support TCFD compliance, and conduct a scenario analysis to evaluate climate-related risks and opportunities can be an example for other companies to follow. By working together, we can achieve a sustainable future and protect our planet for future generations.
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