The Daiichi Sankyo Group is striving to use resources and energy efficiently under the EHS Management Policy, which states, “Lower the environmental impact of the entire supply chain by conserving energy and resources, and reducing greenhouse gas emissions and waste”. To facilitate responsible corporate activities that address climate change, we have set the goals of reducing CO₂ emissions in FY2025 by 42% and in FY2030 by 63% compared to FY2015 based on the approach of the Science Based Targets initiative (SBTi)^*1, which aims to help accomplish the goal of the Paris Agreement (keeping the average increase in global temperature below 1.5°C compared to pre-industrial revolution levels). At Daiichi Sankyo Onahama Plant, we completed construction of a new office building in March 2023 and acquired the Daiichi Sankyo Group’s first Nearly ZEB^*2certification under the Building-Housing Energy-efficiency Labeling System (BELS). Daiichi Sankyo Pharmaceutical (Shanghai) Co., Ltd. followed the Onahama Plant and Daiichi Sankyo Europe’s Pfaffenhofen Plant in putting its solar power system into operation. In April 2022, we switched to renewable electricity (FIT non-fossil fuel energy certificates with tracking) for the electricity we use in 13 sites in Japan, including our head office, production sites, research laboratories, and training facilities. Moreover, operating sites in Europe and Brazil have reduced CO₂ emissions by expanding the use of renewable energy. We are continuing our efforts to further utilize renewable energy at our operating sites globally.

Our CO₂ emissions (Scope 1+Scope 2) for FY2024 were 116,312 tons (42.7% lower than in FY2015). Not limited to our efforts to “mitigate” CO₂ emissions and other environmentally hazardous actions, we facilitate initiatives to “adapt” to impacts that have become tangible or influence that is inevitable in the medium- to long-term.

*1An international initiative that encourage companies to set CO₂ reduction targets in line with the Paris Agreement goals.

*2A building that is nearly a Net Zero Energy Building, cutting net energy consumption by 75% or more.

• Daiichi Sankyo Group Net Zero Transition Plan
• CO₂ Emissions Reduction Targets and Performance
• CO₂ Emissions by Scope
• CO₂ Emissions Reduction Initiatives
• Utilization of Renewable Energy
• Emissions Trading
• Support for the GX League

Daiichi Sankyo Group Net Zero Transition Plan

The Daiichi Sankyo Group has established a Net Zero Transition Plan to achieve net-zero CO₂ emissions across its value chain by 2050. Our GHG emissions reduction targets are to reduce Scope 1 + Scope 2 emissions by 63% by 2030 (base year: 2015), reduce Scope 1 + Scope 2 emissions by 90% by 2040 (base year: 2015), and reduce Scope 3 emissions by 90% by 2050 (base year: 2020). In addition, if residual emissions would generate, we would implement neutralization measures, thereby striving to achieve net zero by 2050.

As targets to support GHG emissions reduction, we have established the following targets:
For Scope 2: Achieving 100% renewable electricity usage by 2030
For Scope 3: Establishing absolute GHG emissions reduction targets by 2028 and ensuring that 70.6%^*3 of suppliers by emissions set SBTi-aligned, science-based targets consistent with the 1.5°C pathway by 2030.

The main initiatives for Scope 1 and 2 include the use of renewable electricity, the continued promotion of energy conservation at manufacturing sites, the introduction of energy-efficient equipment, and the promotion of GHG emissions reductions from fleets. For Scope 3, key initiatives include continuous engagement with business partners, the establishment of global policies related to business travel, and initiatives to reduce GHG emissions from transportation and distribution.

 

*3This includes suppliers in categories 1 (purchased goods and services), 2 (capital goods), and 4 (upstream transportation and distribution)

CO₂ Emissions Reduction Targets and Performance

CO₂ emissions (Scope 1+Scope 2) for FY2024 were 116,312 t-CO₂, 42.7% reduction compared to FY2015. Not limited to our efforts to "mitigate” CO₂ emissions and other environmentally hazardous actions, we facilitate initiatives to "adapt" to impacts that have become tangible or influence that is inevitable in the mid- to long-term. By scope, FY2024 performance for the entire Group was 91,836 t-CO₂ for Scope 1 and 24,477 t-CO₂ for Scope 2, which were 7.7% higher and 2.0% higher than in FY2023, respectively. Scope 3 CO₂ emissions were 4,159,664t, showing 5.6% decrease from FY2023.
To reduce Scope 3 (Cat1) emissions, we have set a KPI in our current mid-term business plan for more than 70% of suppliers to have a 1.5°C targets and are currently strengthening engagement.

  

Breakdown of CO₂ Emissions(Entire Group)

CO₂ Emissions by Scope

Total CO₂Emissions by Region (Scope 1 and Scope 2)

（t-CO₂）

	SCOPE 1	SCOPE 2	Total
In Japan	69,517	1,650	71,167
Outside Japan	22,319	22,827	45,145
Total	91,836	24,477	116,312

Supply Chain GHG Emission (Scope 3) (Entire Group)

Sources	CO2 emissions (t-CO2) FY2023	CO2 emissions (t-CO2) FY2024*	Increase/Decrease Rate Compared to the Previous Year (%)	Emissions Calculation Methodology
Cat1 : Purchased goods and services	3,887,790	3,549,346	△8.7%	The procurement amount of all products and services was multiplied by the emission factor according to the guidelines. Contents included in Scope 1, 2, and other categories of Scope 3 and intra-group transactions were excluded.
Cat2 : Capital goods	220,563	213,987	△3.0%	The amount of fixed assets acquired was multiplied by the emission factor according to the guidelines.
Cat3 : Fuel-and-energy related activities (not included in Scope 1 or 2)	28,217	28,793	2.0%	The amount of electricity and fuel used was multiplied by the emission factor according to the guideline.
Cat4 : Upstream transportation and distribution	49,275	124,607	152.9%	The cost of transportation, delivery, and storage outsourced by the Company was multiplied by the emission factor according to the guideline.
Cat5 : Waste generated in operations	10,800	6,890	△36.2%	The weight of each type of waste generated from plants and laboratories was multiplied by the emission factor according to the guideline.
Cat6 : Business travel	44,043	52,301	18.8%	The travel costs by mode of transportation and lodging costs for business trips were multiplied by the emission factor based on the guideline. The use of business vehicles covered in Scope 1 was excluded.
Cat7 : Employee commuting	4,926	6,495	31.9%	Employee commuting costs by mode of transportation were multiplied by an emission factor according to the guideline.
Cat8 : Upstream leased assets	―	―	―	Category 8 is excluded from the calculation because emissions from the operation of leased assets are included in Scope 1 and 2.
Cat9 : Downstream transportation and distribution	145,857	167,456	14.8%	The Company's consolidated net sales were multiplied by the emission factor according to the guideline.
Cat10: Processing of sold products	―	―	―	Category 10 is excluded from the calculation because although we sell bulk pharmaceuticals to downstream companies among the products we manufacture and sell, the relevant emissions are expected to account for a very small proportion of the total emissions. Category 10 is excluded from the calculation since the relevant emissions are expected to account for a very small proportion of the total emissions, although we sell bulk pharmaceuticals to downstream companies
Cat11 : Use of sold products	―	―	―	Category 11 is excluded from the calculation due to the nature of pharmaceuticals, as there is no energy use based on product use.
Cat12 : End of life treatment of sold products	4,072	7,077	73.8%	The weight of containers and packaging of sold products by type of material was multiplied by the emission factor according to the guideline.
Cat13 : Downstream leased assets	2,248	2,248	△20.29%	Floor area of buildings by use of leased assets owned by the company to other Companies was multiplied by the emission factor according to the guideline.
Cat14 : Franchises	―	―	―	Category 14 is excluded from the calculation because the company does not operate franchise stores.
Cat15 : Investments	10,945	466	△95.7%	CO2 emissions (Scope 1 + 2) of each company that the Company owns shares were multiplied by the Company's shareholding ratio.
Total	4,408,736	4,159,664	△5.6%

CO₂ Emissions Reduction Initiatives

Initiatives at plants and research facilities

We select and install highly efficient energy-saving refrigerators and boilers when upgrading equipment, and implement measures to reduce CO₂ emissions such as installing heat insulation on steam piping, improving the efficiency of air conditioning operation, and using natural light by making use of optical ducts.

Initiatives at offices

At office buildings, energy-saving is promoted by installing LED lights and motion detectors throughout buildings. In addition, measures to reduce energy consumed at offices are actively implemented, such as wearing casual business clothing throughout the year, ensuring the lights and air conditioners are turned off in unused meeting rooms, and recommending employees to leave work on time by optimizing schedule management. In respect to employees’ travels between operation sites, efforts are being taken to reduce domestic and international business trips by further improving and utilizing video conference system.

Energy usage

Breakdown of Energy Use (Entire Group)

Utilization of Renewable Energy

At Daiichi Sankyo Europe Pfaffenhofen Plant in Germany, which has been converting all purchased electricity to electricity generated from renewable energy since 2014, a self-consumption solar power system (annual energy production of 580 MWh) constructed on the plant’s premises began operation in February 2022. Moreover, in FY2023, we began converting to renewable fuels by using biomass wood pellets for steam production. In addition, in January 2023, the Daiichi Sankyo Pharmaceutical (Shanghai) Shanghai Plant began using a solar power plant (with annual energy production of approx. 540 MWh), which is able to cover the annual energy consumption of the plant’s administrative building. This is expected to reduce CO₂ emissions by 300 tons per year. In addition, at Onahama Plant, which started operation of the solar power system with annual energy production of approx. 4,000 MWh in December 2020, finished construction of the Daiichi Sankyo Group’s first Nearly ZEB-certified building, its new office, in March 2023. This office generates electricity using solar power and saves energy by effectively combining high-efficiency air conditioning, water heating, and lighting equipment, thereby cutting standard building energy consumption by 78% (51.9% from energy savings and 26.9% from energy generation). The Daiichi Sankyo Group is a member of RE100 and aims to achieve a 100% utilization rate of electricity derived from renewable energy sources by FY2030 and a materiality KPI of at least 60% by FY2025. The renewable electricity utilization rate in FY2024 is 79.9%, well on track to achieve RE100. We will continue to actively introduce various renewable energy sources, including solar power generation.

Onahama Plant New management building

Daiichi Sankyo Pharmaceutical (Shanghai) Shanghai Plant

Daiichi Sankyo Europe Pfaffenhofen Plant

Renewable Energy Usage and Breakdown

Types of Renewable Energy	Power Supply (MWh)	Remarks
Solar energy generation	126,036	Electricity generated at sites in Japan, Germany, and China and electricity purchased in Japan.
Hydroelectric power generation	73,790	Purchased by our Group companies in Japan, Germany and Brazil.
Biomass power generation	8,416	Purchased by group companies in Germany.
Other renewable energies	14,624	Purchased by group companies in Japan, Germany, France, Spain, China and other countries.

Emissions Trading

The Shinagawa R&D Center and Kasai R&D Center are among the facilities subject to the mandatory emission reduction scheme and the emissions trading system, Tokyo Cap and Trade Program, under the Tokyo Metropolitan Ordinance on Environmental Preservation. Daiichi Sankyo Biotech is also among such facilities under the Saitama prefectural government's global warming countermeasures ordinance. Recognized for their particularly outstanding measures to combat global warming, the Shinagawa R&D Center and Kasai R&D Center were certified as a “near-top-level facility” in fiscal 2019 and fiscal 2020, respectively.

Supplementary Notes

Conversion factors and their sources

Conversion factors of the Accounting and Reporting System under the Act on Promotion of Global Warming Countermeasures are used for the CO₂ conversion factor and the energy conversion factor. Regarding countries outside Japan, the factors commonly used in such countries or the factors based on GHG protocol are used.

Emissions not in the calculation

The emission data does not include emissions in Scope 1 or Scope 2 from small offices outside Japan. Also, it does not include emissions of GHGs other than CO₂, as they are small in quantity.

GHG emissions from sold products

Any use of sold products will not help reduce GHG emissions.

Improving credibility of the environmental performance data

Aiming to improve the credibility of the information disclosed to stakeholders, Daiichi Sankyo receives third-party assurance for its environmental performance data. When aggregating the environmental performance data, we strive to improve the accuracy and credibility of the data disclosed by inputting highly objective data in principle, based on evidence issued by third parties, such as purchasing slips.

Support for the GX League

We have expressed our support for the GX League^*4, which was established by the Ministry of Economy, Trade and Industry towards achieving carbon neutrality by 2050, and we will participate in the carbon-credit-market demonstration project to be started in September of 2022.

• *4 To achieve carbon neutrality by 2050, it was established as a forum for companies that actively engage in GX (Green Transformation) that brings together industry, government, academia, and financial sector, to hold discussions on reforming the entire economic and social system for GX, and to pursue the creation of new markets.