Environment Highlights

Recognition of Issues in Environmental Initiatives toward Achieving SF2030
Major FY2024 Initiatives
Direction of Environmental Initiatives from FY2025 Onward

Recognition of Issues in Environmental Initiatives toward Achieving SF2030

OMRON believes that creating an environmentally sustainable society corresponds to the OMRON Principle of “contributing to a better society,” and is proactively working to address global issues such as climate change and resource recycling. In particular, we view reducing greenhouse gas (GHG) emissions, transitioning to a circular economy, and coexisting with nature as important environmental issues to be addressed. By ensuring effectiveness and establishing frameworks, we are committed to contributing to the creation of a sustainable society and enhancing corporate value.

Targets under the long-term vision SF2030

Under SF2030, we set “Achieving Decarbonization and Lower Environmental Impact” as one of the five material sustainability issues, aiming to solve social issues through the reduction of GHG emissions in our value chain and the establishment of a resource recycling model by 2030, as well as to achieve a state in which further competitive advantages are built.

Targets through FY2024

For the three years from the launch of SF2030 in fiscal 2022 to fiscal 2024, we set the four targets listed below and monitored the progress toward them. As we regard environmental initiatives as the foundation for business growth in the future, we continued working on them during the period under the Structural Reform Program “NEXT 2025.” Our Scope 1, 2, and 3 GHG emission targets are certified by the Science Based Targets initiative (SBTi) as 1.5°C or 2.0°C pathway targets.

1. 68% reduction of in-house GHG emissions (Scope 1 and 2) in absolute amount vs. FY2016 levels
2. Achieving Carbon Zero at all 76 sites*1 in Japan
3. Implementing energy-saving designs for new products (Scope 3 Category 11)
4. Implementing business model transformation, environmentally friendly design, collection and recycling, and sustainable procurement in response to transition to a circular economy

Major FY2024 Initiatives

In fiscal 2024, we continued our efforts for reduction of GHG emissions across the entire value chain and transitioning to a circular economy.

Measure (1) Reduction of in-house GHG emissions (Scope 1 and 2)

For Scope 1 and 2, we focused on reduction of GHG emitted through the use of electricity supplied by other companies (Scope 2 emissions), which accounted for approximately 90% of GHG emissions from OMRON sites. We promoted comprehensive energy-saving efforts and use of renewable electricity on a global basis. As the production sites made progress exceeding the initial plans in conclusion of Power Purchase Agreements (PPAs) and additional introduction of facilities such as storage batteries, we significantly outperformed the target and achieved a 74% reduction in the absolute amount of GHG emissions (compared with fiscal 2016). Especially in sites in Japan, we continued improvement of energy efficiency, mainly by utilizing services provided by the Industrial Automation Business (IAB). In addition, we achieved Carbon Zero in Scope 2 at all 75 sites*2 by expanding the use of the J-Credit Scheme provided by the Social Systems, Solutions and Service Business (SSB) and PPAs.

Achievement of Carbon Zero at OMRON sites in Japan

75 sites *3

For further details on the services provided by IAB and SSB utilized in the achievement of Carbon Zero at OMRON sites in Japan, please refer to the following:

Industrial Automation Business: i-BELT Data Management Platform (i-DMP)

Social Systems, Solutions and Service Business: Our Eco Life Circle (Japanese Only)

Social Systems, Solutions and Service Business: Self-consignment System

* 1,2,3　The number of sites in scope changed from 76 to 75 in fiscal 2024 due to the reduction of sites

Measure (2) Reduction of GHG emissions (Scope 3)

For Scope 3, we focused on reduction of GHG emitted from the use of products, services, etc. manufactured or sold by our Company (Scope 3 Category 11), which account for approximately 70% of GHG emissions across the entire value chain.

We worked on assessment of our existing products by using the environmental evaluation framework developed in 2023, and developed the structure for each business to calculate emissions. In addition, each business worked on development of products that are highly energy-efficient or compact/lightweight and promoted expansion of the lineup of such products.

Although Scope 3 Category 11 GHG emissions increased by 540 kt-CO2e compared to the previous year due to the improved accuracy in calculation as a result of the revision of the calculation process, we outperformed the target by achieving a 26% reduction in absolute amount compared with fiscal 2016.

Measure (3) Environmental evaluation framework

Aiming to promote OMRON’s environmental initiatives and enhance customer value, we developed the environmental evaluation framework. The framework is a system that evaluates products from a lifecycle perspective and visualizes their environmental performance with the aim of creating a sustainable economy (See Figure 1).

Under the environmental evaluation framework, based on the EU Taxonomy, “environmentally conscious products” are defined as those evaluated for each of the five environmental characteristics that need to be addressed to achieve a sustainable economy ((1) climate change, (2) circular economy, (3) pollution prevention, (4) water resources, and (5) biodiversity) . Additionally, products demonstrating outstanding effectiveness in the environmental characteristics of climate change and circular economy are defined as “environmentally contribution products.”

Figure 1: Environmental Evaluation Framework

Passed product environmental assessment, Quantify environmental performance throughout the entire life cycle*1, Quantify environmental impact throughout the entire life cycle*2, Environmentally Contribution Products, Environmentally Conscious Products, Products that demonstrate excellent environmental performance in specific environmental characteristics*3 and contribute to solving customers’ environmental issues, Products that reduce negative impact by taking into account five environmental characteristics

*1 Current quantification only includes GHG emissions over the entire life cycle (PCF)

*2 Current quantification only includes GHG reduction volume over the entire life cycle (avoided emissions)

*3 Current evaluation only includes “climate change” and “circular economy” out of the five environmental characteristics

■Environmentally Conscious Products

Environmentally conscious products are products that reduce negative impact by taking into account five environmental characteristics. The product environmental assessment evaluates each key environmental characteristic, designating products that meet the criteria as environmentally conscious products. All products must pass the product environmental assessment as conducted in accordance with the defined flow before reaching market launch, ensuring that all OMRON products are inherently positioned as environmentally conscious products (See Figure 2).

Figure 2: Product Environmental Assessment Flow

Implementation stage Assessment details Product planning Setting assessment targets: ・Subjects of assessment Environmental impact reduction factors ・Assessment items ・Environmental impact reduction targets→Concept-making/design: Determination of the design policy,Determination of measures. for realization→Detailed design: Comprehensive evaluation, Detailed design

Example of Environmentally Conscious Products:G9KB Series, High-capacity Power Relays

OMRON developed its common guidelines for calculating the product carbon footprint (PCF) with support from the Sustainable Management Promotion Organization , aiming to establish a CO2 data calculation method consistent with Catena-X and other international frameworks. Our calculation guideline references ISO 14067:2018 and the Pathfinder Framework for CO2 data calculation and sharing, issued by the Partnership for Carbon Transparency (PACT) organized by the World Business Council for Sustainable Development (WBCSD). The Device & Module Solutions Business (DMB) calculates PCFs for the G9KB series of high-capacity power relays, which are used in new energy equipment such as power conditioners and energy storage systems, in accordance with the guidelines. In May 2024, DMB started to provide the calculated data upon customer request.

■Environmentally Contribution Products

Environmentally contribution products are those that meet the requirements of environmentally conscious products and demonstrate superior environmental performance in key environmental aspects to help solve customers’ environmental challenges. This product group adopts the amount of avoided emissions, a metric increasingly standardized internationally, as its evaluation criteria to visualize environmental values for “climate change” and “circular economy.”

We completed the evaluation of the KPV series, a power conditioner for photovoltaic power generation systems provided by the Social Systems, Solutions and Service Business (SSB), and designated them as the first environmentally contribution products in December 2024.

Example of Environmentally Contribution Products:

Power conditioner for photovoltaic power generation systems (KPV series)

A power conditioner for photovoltaic power generation systems is a device used to convert and regulate the power generated in solar power generation systems into a form for use in homes, facilities, and on the power grid. Unlike methods that generate electricity by burning fossil fuels, solar power generation is a clean energy source that causes no GHG emissions. Use of electricity generated from such a source will reduce electricity derived from fossil fuels and help reduce GHG emissions.

Type of eligibility for environmentally contribution products:

End-use solutions

Intermediary solutions

Solutions that directly and significantly improve or optimize systems

Power conditioner for photovoltaic power generation systems (KPV series)

Reduced GHG Emissions in Solar Power Generation Systems

Average for electricity in Japan*1,Solar power generation systems*2, Avoided emissions (approximately 70% reduction of GHG emissions)

Reference scenario Average for electricity in Japan: Using the Inventory Database for Environmental Analysis (IDEA) Ver. 3.3, calculated direct emissions (from energy used for power generation) and indirect emissions (other than those from energy used for power generation; emissions from power plant disposal are excluded)

Solution Solar power generation systems: GHG emissions of power conditioners are calculated in-house as PCF from a perspective of life cycle assessment*3. GHG emissions of other components are calculated by referring to a report of the Central Research Institute of Electric Power Industry*4 and independently considering differences between the time of the report and the present time (e.g., overloading rates). Emissions from power plant disposal are calculated with reference to a report of the New Energy and Industrial Technology Development Organization (NEDO)*5.

Common prerequisites: Time frame: Flow type (forward-looking type) Lifetime: 15 years*6
Cut-off: None*7 Third-party assurances: None

*1 Ratios for raw material procurement, production, disposal/recycling are approximate, as IDEA categorizes the life cycle into use (during power generation) and other.

*2 The graph shows an image for reference by applying the ratio for each life cycle stage of power conditioners, not the ratio of solar power generation systems, to the total emissions.

*3 Conservative scenarios are used when calculation using primary data is difficult. The emission coefficient of IDEA Ver. 3.3 is used.

*4 Central Research Institute of Electric Power Industry report: Comprehensive Assessment of Life Cycle CO2 Emissions from Power Generation Technologies in Japan, July 2016

*5 NEDO report: Research on life cycle assessment of photovoltaic power generation system (March 2009)

*6 The period for calculating avoided emissions is set at 15 years, which is a standard useful life of power conditioners. For other components of solar power generation systems, emissions for the first 15 years of their life cycle are included. The useful life of these components is assumed to be 30 years based on materials issued by the International Energy Agency and other sources.

*7 Cut-off is not applied in quantifying differences. For the PCF of power conditioners used in calculation of the solution PCF , cut-off is applied during the calculation by excluding items below 5% for the total and 1% individually.

Measure (4) Transitioning to a circular economy

Aiming at effective utilization of limited resources, OMRON worked on initiatives for transitioning to a circular economy. Each business worked on measures such as reduction of metals and plastics used in products, under the following four pillars: implementing business model transformation, environmentally friendly design, collection and recycling, and sustainable procurement.

Direction of Environmental Initiatives from FY2025 Onward

Social demand for corporate initiatives for environmental issues is growing year by year, and there is an increasing trend for such initiatives to be legally regulated. Especially, regulators are making it obligatory for companies to formulate and implement climate transition plans for achievement of carbon neutrality and disclose details of the initiatives toward this commitment.
Considering these social developments, we will further accelerate our initiatives for reduction of GHG emissions across the entire value chain and achieving a circular economy through our business activities. In fiscal 2025, we will conduct surveys on suppliers’ status of GHG emissions and their reduction targets/plans. Based on the survey results, we will consider target levels and measures for future reduction.
Moreover, we will work on initiatives for “coexisting with nature” by promoting initiatives such as those for natural capital based on the OMRON Biodiversity Policy revised in 2024 and the recommendations of the Taskforce on Nature-related Financial Disclosures (TNFD) , to respond to social expectations.

Results to Date and Future Targets

Item	Area	Targets through FY2024			Results to date			Future targets	Progress Evaluation
Item	Area	Item	Benchmark (FY2016)	FY2024	FY2022	FY2023	FY2024	FY2030	Progress Evaluation
Reduction of GHG Emissions	OMRON (Scope 1 and 2)	GHG emissions （kt-CO2e）	250	80	93	79	64	88	◎
		Reduction (%)	-	-68%	-62%	-68%	-74%	-65%	◎
		Achieving Carbon Zero at OMRON sites	-	Achieving Carbon Zero at all 76 sites in Japan (subject to Scope 2)	10sites （13％ progress）	39sites （51％ progress）	75sites （100％ progress） * The number of sites in scope changed from 76 to 75 due to the reduction of sites.	Not set	◯
	Entire value chain (Scope 3)	GHG emissions （kt-CO2e）	9,102	Not set	11,965	6,205	6,674	7,464	◎
		Reduction (%)	-	Not set	＋31％（Category 11）	-32% （Category 11）	-26% （Category 11）	-18%	◎
				Scope 3 Category 11: Implementing energy-saving designs for new products	(1) Completed replacing the calculation method for basic models of IAB, OMRON HEALTHCARE Co., Ltd. (OHQ) , and OMRON SOCIAL SOLUTIONS Co., Ltd. (OSS) from catalog values to actual values (2) Completed designation of products subject to reduction of emissions and formulation of action plans for IAB, OHQ, and OSS	Completed launch, development, and verification of energy-saving and resource-saving products designated by IAB, OHQ, and OSS	Promoted power-saving design, downsizing, and weight reduction of new products, as well as replacement with low-power-consumption products in each business	-	◯
Transitioning to a circular economy				Implementing business model transformation, environmentally friendly design, collection and recycling, and sustainable procurement in response to transition to a circular economy	Revised definition of “environmental contribution” and set a new course	Established the environmental evaluation framework. Defined “environmentally contribution products” and “environmentally conscious products” Each business systematically addressed the priority issues Completed development of the PCF calculation rules and methods, which serve as the basis for “environmentally conscious products.” Each business started calculation and disclosure initiatives individually.	Expanded lineup of environmentally contribution products that follow the environmental evaluation framework	-	◯

OMRON considers climate change to be one of the most important issues we need to address. Since endorsing the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) in February 2019, we have been promoting the disclosure of climate-related information in accordance with the TCFD framework and other influencing factors. For further details, please refer to the following:

Annual Securities Report for the 88th Term , P.33, “(3) Initiatives related to environment (climate change)”

Responses to Climate Change

Climate-related Information Disclosure