Climate change is a common challenge for humankind, and we believe it is one of our business materiality themes. We are committed to achieving a sustainable society through our businesses and by reducing our own CO2 emissions.
CO2 emissions Reduction from Precious Metals Recycling
Precious metals recycling is recognized as having a lower environmental impact than producing new precious metals from virgin mining. For example, when comparing CO2 emissions, gold is estimated to produce approximately one-tenth the emissions. Applying this ratio to our precious metals recycling volume would result in an indirect CO2 reduction of 600,000 t-CO2, which is approximately 30 times the emissions of our Group. In addition to continuing its own efforts to reduce emissions, the Group remains committed to helping reduce CO2 through precious metals recycling. (This CO2 emissions reduction figure does not represent emissions directly reduced by the Group.)
CO2 reduction effect from precious metals recycling
600,000 t-CO2
Reduction effect: approximately 30 x
Emissions by the ARE Holdings Group
20,000 t-CO2
Environmental benefit of precious metals recycling
Equivalent to
42.83 million trees
When expressed as the amount of greenhouse gases absorbed by forests, it equals
25,196 hectares
Source: Forestry Agency of Japan, Ministry of the Environment; calculation was based on the assumption that one cedar tree absorbs 14 kg of CO2 annually, and 1,700 cedar trees are planted in an area of one ha
Effect of reducing emissions by precious metals recycling 538,000 t-CO2
Emissions factors used for calculation
| Refining mined raw materials |
Gold |
12,621kgCO2/kgAu |
| Silver |
95kgCO2/kgAg |
| Platinum, Palladium, Rhodium |
9,297kgCO2/kgPd |
| Cu |
1.7kgCO2/kgCu |
| Recycling |
Gold |
1,256kgCO2/kgAu |
| Silver |
22kgCO2/kgAg |
| Platinum, Palladium, Rhodium |
658kgCO2/kgPd |
| Cu |
0.7kgCO2/kgCu |
Note: Calculated from Life Cycle Assessment Data for Computer Products, Mobile Phones and Mixed Waste (Source: United States Environmental Protection Agency website)
Third-Party Verification of CO₂ Emissions
For our main product, 99.99% gold granules, we calculated the CO₂ emissions from raw material collection to product manufacturing (Cradle to Gate) and conducted third-party verification in accordance with ISO14040:2006 and ISO14044:2006. This value will be made available to the users of this product in a format suitable for use as primary data in calculating their indirect emissions.
Response to Recommendations by the Task Force on Climate-Related Financial Disclosures (TCFD)
Endorsing the TCFD and Strengthening Governance
In December 2021, we endorsed the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) and established a cross-company team for TCFD. This team included staff from the Business, Technical, and Administration Units who identified risks and opportunities related to climate change, assessed the medium- to long-term impact of climate change on our business, and considered countermeasures.
Currently, this is carried out by the Climate Change Working Group of the Sustainability Committee, which is overseen by the Representative Director and President (CEO). The members include the directors in charge of the Business, Technical, and Administration Units, as well as others. The identified risks and opportunities are reviewed at least once a year and the status of responses is reported to both the Sustainability Committee and the Board of Directors. Critical matters are decided by the Board of Directors to reinforce governance.
Strategies
Identification of Risks and Opportunities
We identify risks and opportunities related to climate change that will affect our precious metals business segment (domestic and North American refining businesses) as well as the environmental preservation business segment in 2030. We separated the risks and opportunities into these categories: short-term (1 year or less), medium-term (over 1 year and up to 3 years), and long -term (over 3 years and up to 10 years), and we qualitatively assessed them on three levels: large, medium, and small. We also considered the further impact of climate change from 2030 to 2050. As a result, policy and legal, market, technology factors, etc. were identified.
Summary of Scenarios
We conducted scenario analyses for climate change to investigate the impact on our business. We chose two scenarios: one where the global average temperature is expected to increase by around 4°C by 2100, and another where the increase is 1.5°C by 2100, compared to pre-industrial levels. These analyses were based on the World Energy Outlook 2021 by the International Energy Agency (IEA), reports by the Intergovernmental Panel on Climate Change (IPCC), and materials published by the Japanese government.
Results of Scenario Analyses
The 4°C scenario is where the current situation continues, and we found that there would be little impact on our operations as of 2030. On the other hand, as we move toward 2050, under this scenario, we anticipate an increase in a physical risk: the intensification of natural disasters such as typhoons or floods caused by severe weather. In addition to managing business continuity, we are also taking actions such as selecting disaster-resistant locations when relocating plants.
For the 1.5°C scenario, strong policy measures are expected to be taken to achieve carbon neutrality by the mid-century. One of these risks is the introduction of carbon pricing, including a carbon tax. Being affected by cost increases will become a risk. On the other hand, in the precious metals business segment, recycled metals, which emit relatively little CO2 emissions, could gain a reputational and cost advantage. This is an opportunity for the Company, which has strengths in the production and traceability of recycled precious metals.
In our environmental preservation business segment, providing systems that reduce environmental impact presents an opportunity. We will focus on expanding these opportunities while mitigating risks.
Risk Management
The Climate Change Working Group will compile the responses to risks and opportunities related to climate change and CO2 emissions. The Sustainability Committee will monitor and evaluate them every year. The Board of Directors will also be informed of the contents for supervision and direction. In addition, the Group Risk Management Department is also informed of the risk management of the entire Group.
Results and Plans for CO2 Emissions
In fiscal year 2023, the Group’s total CO₂ emissions decreased by approximately 31% compared to the base year of fiscal year 2015, excluding emissions from sites (two outside Japan) that became part of the Group after the base year. The breakdown of the reduction shows a domestic decrease of approximately 60%, achieved through efforts such as reviewing power suppliers, replacing vehicles, and changing fuel types due to factory transfers.
Emissions overseas were reduced by approximately 7% due to reduced city gas usage, a lower CO2 emission intensity, and other factors.
The ARE Group recognized the reduction of CO2 emissions as a key business materiality and has set a target of reducing CO2 emissions by 63% from fiscal year 2015 levels by fiscal year 2030. Furthermore, we have declared our commitment to achieving carbon neutrality by fiscal year 2050.
[Scope of data collection]
Scope 1 and 2 emissions from the company and its consolidated subsidiaries* (Reporting period: April to March)
* Pertains to consolidated subsidiaries as of March 31, 2024. Data for subsidiaries removed from the group is updated retrospectively. Data for new subsidiaries is included starting from the fiscal year they joined in terms of CO2 emission trends.
Trends of CO2 Emission
CO2 Emission Reduction Plan