Sustainability Goals under the Medium-term Management Plan 2020

For the "Promotion of Sustainability Management" as set forth in the Medium-term Management Plan 2020, Sojitz will strive to further incorporate the perspective of sustainability* in management and more deeply merge its businesses with solutions to environmental and social issues.
(*Maximize the "Two types of Value," "Key Sustainability Issues")

As one approach, we have set "sustainability goals" for each Key Sustainability Issue (materiality) to achieve within the period of the Medium-term Management Plan 2020, Each goal is set to strategically increase sustainability through the promotion of various businesses and initiatives.

In working to achieve sustainability goals, each division along with corporate departments creates an annual action plan, and the president, as chairman of the Sustainability Committee, monitors the progress towards these goals. Furthermore, we disclose the results of each initiative annually to our stakeholders.

Key Sustainability Issues	Sustainability Goal	Business Area	Planned Approach	Result
Environment	Qualitatively grasp CO2 emissions from business activities	Company-wide	We will regularly and consistently conduct surveys of direct CO" emissions from Sojitz Group business activities, and consider setting improvement goals for each sector.	Reflecting the opinions that we received from external experts through our stakeholder dialogues, we have established and disclosed policies for realizing a decarbonized society.
	Qualitatively grasp CO2 emissions from business activities	Company-wide	We will conduct an analysis of the volume and impact of CO2 emissions of Sojitz Group, including its value chain, based on a objective climate change scenario.	We have conducted scenario analysis under the 1.5°C scenario for our thermal power generation and coal interests, which are sectors that emit large quantities of CO2.
	Promote low-carbon businesses focused on decarbonization	Renewable energy	We will undertake the widespread use and expansion of renewable energy through development and business operation of solar power and wind power generation business, and sales of related facilities and equipment. We will also strive for investment in new renewable energy fields.	◆In terms of our renewable energy businesses, we have begun commercial operations of a solar power plant business in Japan as well as construction on an offshore wind power project in Taiwan, which is proceeding with stringent construction management practices in preparation for the start of operations. ◆With the aim of building the a next-generation energy society, we have concluded a capital and business alliance with Looop, a firm whose main business is to conduct electricity retail services and develop, build, and manage solar power generation systems.
		Natural gas/LNG	In addition to development and business operation of natural gas and LNG generation business, which have relatively low CO2 emissions levels compared to fossil fuels, through investment in midstream businesses such as LNG port construction and sales of related facilities and equipment, we will strive for a full-fledged energy base focused on realizing a low-carbon society.	Sojitz has officially concluded a natural gas supply agreement with two plants of a Vietnamese subsidiary as part of a coal-to-gas fuel conversion project.
		EV-related	We will contribute to promoting the widespread use of EV cars which do not emit CO2, through providing manufacutinrg equipment and raw materials, and by establishing new, related businesses.	We have received orders for battery manufacturing equipment and charge-discharge inspection equipment for the development of new nickel-metal hydride (NiMH) batteries and have completed the fabrication work.
	Contribute to creating a recycling society	Recycling	Sojitz is expanding the recycling business related to the wide range of products it handles, such as the reuse and sale of used parts from retired aircrafts, in order to promote reduction in CO2 emissions by doubling the lifecycle of products.	Sojitz has acquired a stake in TES-AMM Japan. Moving forward, we will pursue business to reuse and recycle IT assets.
	Contribute to creating a recycling society	Low-carbon materials	By expanding sales of plant-based raw materials, which offset CO2 emissions resulting from combustion of the final product, we will contribute to the shift away from fossil fuel based raw materials and to the reduction of CO2.	Sojitz’s business handling green polyethylene—a material derived from sugar cane—is seeing steady sales, and we will accelerate the development of further applications for the material.
Human Rights	Promote human rights and due diligence	Company-wide	We will analyze examples of manifest environmental and human rights risks worldwide, provided by the NGO“Business and Human Rights Resource Center,” to determine which of our business areas are high risk. We will then conduct risk assessments for 100% of group companies and suppliers in these business areas.	We focused on putting systems in place to survey and manage risks specific to the business sectors of our Group businesses. Of our approximately 300 consolidated subsidiaries, 59 (including 23 equity-method affiliates) are in high-risk business areas, and we are checking the status of their actions taken in response to environmental and social issues. In addition, Sojitz established the Palm Oil Procurement Policy in December 2020.
Resources	Produce and supply resources at risk of depletion in the future	Food resources	We are contributing to securing food resources with a focus on future population growth, principally in the feed production and sales business, which require stable production and quality minantenance, and feed plant construction business.	◆The domestic and overseas markets for rice, the main target crop for our fertilizer business, have been stable and business has been strong. ◆We have continued to promote and educate customers and farmers on fertilizer quality and application methods through seminars and other means.
		Water resources	Focused on developing countries with an expected increase in demand for water resources, we will strive to establish and expand businesses that provide a stable supply of domestic water.	Our water treatment materials sales business for overseas customers is strong.
		Marine product resources	Making use of the expertise acquired through the marine products business, we will take on the challenge of "whole cultivation," raising adult fish from artificially bred juvenile fish.	Shipments of fish sourced from full life-cycle aquaculture are steady.
		Forestry resources	Strive for 100% traceability of the wood we handle by FY2020, and in the future, we will aim to ensure that 100% of the wood we handle is produced through suitable, environmentally/socially-conscious forest management.	Surpassing our goal of 80% or more, we have ensured that 92% of the wood we handle is Level A (certified wood) or Level B (wood that has not been certified, but for which we have verified that the forest is subject to environmentally/socially conscious forest management).
Local Communities	Promote businesses that grow together with developing countries	Transportation and transport infrastructure	In the management business for our consigned airport, we will strive for smooth facility operations and an increase in the satisfaction of airport users.	Although there are limitations on construction progress due to the COVID-19 pandemic, we continue to aim for early completion of an airport terminal expansion project.
		Transportation and transport infrastructure	We will aim for a modal shift connected to reduction of CO2 in the railroad construction business focused on developing countries and railcar maintenance business, as well as the promotion of economic growth in local communities.	Although there are limitations on construction progress due to the COVID-19 pandemic, we are making efforts to prepare and lay the groundwork for a post-pandemic railroad project.
		Medical infrastructure	We will aim for the sound execution of hospital management in Turkey, and in the future, the development of businesses in other countries calling for an improvement in medical infrastructure.	To address the shortage of hospital beds in Turkey, the Ikitelli Integrated Health Campus opened four months ahead of schedule.
		Urban infrastructure	Through the establishment of infrastructure forming the foundation for corporate business activities, such as our industrial park development and management business in developing countries, we will promote the overseas expansion of corporations and the deveopment of local economies and industries in our countries of business.	We have begun the first phase of leasing factories at our industrial park in the suburbs of Chennai, India.
	Promote businesses that connect to solving problems in developed countries	Initiatives that solve social problems	We will aim to establish and expand businesses that will solve the respective environmental and social problems in Japan and those of developed countries.	Sojitz has opened 24 new day care centers over the three years of the plan.
	Conduct social contribution activities in developing countries		In line with the fundamental perspective on social contribution,(※) we will reassess our existing activities in Japan and abroad, and strive to establish new activities. (※)Social Contributions：Basic Approach	Sojitz has begun supporting the education and professional development of Vietnam’s university students in science and technology fields.
Human Resources	Develop future senior managers	Company-wide	We will properly choose candidates and create a system to plan the development of these employees. In addition to the standard group training for GMs and SMs, we will put into place and continually hold a training for selected employees to develop the strategical thinking abilities required to become a senior manager. In addition, we will implement a rotational system to enable employees to acquire experience in business management and decision making.	◆We have conducted training to improve organizational management skills and training for selected senior management candidates. ◆Employees with a certain level of experience are dispatched to operating companies on a rotating basis, providing opportunities for them to grow and develop their skills through on-the-job experience. ◆In April 2021, Sojitz appointed its first female executive officer through internal promotion.
	Develop management-level employees		Regardless of age, we will provide opportunities and experiences to employees with strong desire and abilities, striving for the rapid development of the next generation of management-level employees.	◆Sojitz introduced a talent management system in 2018. The system is being used to allocate the right people to the right positions based on organizational needs and the desired career paths of individual employees. ◆In FY2020, we established a new overseas trainee program that allows employees to develop a perspective that transcends organizational boundaries and gain on-the-job experience by assisting in the management of overseas operating companies and local subsidiaries through cross-divisional and cross-departmental activities.
	Develop employees that continue to take on challenges		We will continuously operate a goal management system that promotes taking on challenges, and conduct appraisals that properly evaluate these challenges. We will monitor the developmental progress of employees and organizations in taking on challenges, putting to use the 360° evaluation given to a portion of management employees and the results of the employee awareness survey,	We have provided opportunities and expanded internal programs to support the development of employees who are proactive challenge takers. These include: ・The establishment and ongoing implementation of the Hassojitz Project, which aims to create new businesses (from FY2019) ・The establishment of a new company to allow employees to establish start-ups or take on side businesses (end of FY2020) ・The establishment of Sojitz Alumni as a business networking platform to foster connections among Sojitz’s former employees and between current and former members of the company (April 2021) ・The introduction of a support system for independent businesses and entrepreneurs (April 2021)
	Acquire and promote the role of diverse human resources		We will promote diversity management that puts to use the unique traits of each employee in the organization, including work reforms to enable a diverse range of employees to be healthy in mind and body and to exercise their full potential. Furthermore, we will continue to ensure a work environment conducive to these goals.	◆In the hiring of new graduates, the ratio of female career-track employees has been 30% or higher for three consecutive years since FY2018. ◆In terms of mid-career recruitment, we hire about 25 people yearly who possess diverse experiences and knowledge as candidates for management positions. ◆We have achieved our target of promoting 54 women to managerial positions. ◆In terms of initiatives to support a diverse employee base, we have expanded support for balancing work with childcare, including by establishing a system to support a quick return to work after childbirth and securing corporate slots at daycares near our offices. ◆We introduced a telework system in January 2020, and we are also expanding our working system to accommodate the increasingly diverse work styles of our employees. Click here for details
	Increase productivity		We will continue to implement work reforms and diversity management, striving for an increase in efficiency of each employee and organization, and as laid out in the five guiding principles, take on new challenges and increase our speed and momentum.	◆We are pursuing greater operational efficiency through the use of RPA (robotic process automation), and have eliminated 27,000 hours of working time over three years from FY2018. ◆We have increased the rate of employees taking paid vacation days and reduced overtime hours (by approximately 6 hours over the 3 years from FY2018) during Medium-term Management Plan 2020. This was achieved through initiatives such as messages from upper management encouraging employees to take paid annual leave, continuously raising awareness throughout the company of the need to take paid leave, and email alerts from the timesheet system to alert employees regarding long working hours. In addition, we have adopted a “super flex” system, which eliminates core hours in order to improve employee productivity. Click here for details ◆In addition, we have implemented a company-wide records management initiative to change our corporate culture of paper storage to electronic storage. Through this initiative, we have reduced by half the amount of paper stored per person and have reduced printing costs by over 40%.

Summary of Sustainability Targets

1) Environment: Formulating New Policies while Pursuing Low-carbon Businesses and Participating in Recycling Businesses
Based on a survey of CO2 emissions in our business activities and on the 1.5℃ scenario analysis of our thermal power generation and coal interests, we have formulated a new policy to promote decarbonization taking into account risks and opportunities that climate change poses to our businesses. We have accelerated the development of decarbonization projects such as renewable energy businesses and coal-to-gas fuel conversion projects, as well as low-carbon businesses with an eye towards decarbonization. In addition, we have established a framework for the formation of a recycling-based society by participating in recycling projects in multiple sectors.

2) Human Rights: Identifying High-Risk Areas in our Supply Chains
In preparation for achieving our Sustainability Challenge, Sojitz Group has identified and confirmed high-risk industries that are of high priority to the company and has conducted surveys and evaluations of the entirety of its supply chains, including those of customers, as part our Medium-term Management Plan 2020.

3) Resources: Promoting Environmentally and Socially Responsible Materials, and Contributing to the Realization of a Sustainable Food System
In the lumber business, we have increased the ratio of environmentally and socially responsible timber in accordance with our Wood Procurement Policy. In the food sector, we have contributed to the realization of a sustainable food system by beginning to handle fish sourced from full-life cycle aquaculture, among other measures.

4) Local Communities: Pursuing Medical Transportation Infrastructure Businesses that will Grow Together with Emerging Countries
We have accelerated our development of businesses in the medical and infrastructure fields. For example, we have opened a hospital with the largest number of beds in Turkey ahead of schedule, and have begun leasing out factories at an industrial park in India. Under Medium-term Management Plan 2023, we will also work to recover from the impact that the COVID-19 pandemic has had on our airport operations and railroad businesses.

5) Human Resources: Attracting Diverse Talent and Developing Employees that Continue to Take on Challenges
We have accelerated our human resources development efforts aimed at creating new value through developing top-level management, recruiting diverse employees, creating a work environment that allows each employee to maximize their unique capabilities, and strengthening management training.