Response to the TNFD

Toyota Boshoku group formulated the 2050 Environmental Vision in 2016. And we reviewed the Toyota Boshoku group's past activities and our future target and in July 2023 drew up three key initiatives. We promoted three key initiatives:measures to global warming prevention in response to climate change, circular economy in response to the depletion of natural resources, and co-existence with nature in response to the biodiversity crisis. And we analysed nature-related risks and opportunities to understand nature dependencies and impacts of our group business and further three priority actions. In future, we will disclose our information based on Taskforce on Nature-related Financial Disclosures (TNFD) framework. We aim to further contribute to global environmental conservation.

Analysis Process

We analysed by LEAP approach of TNFD framework.

Locate Identify priority region	Evaluate Grasp dependencies and impacts	Assess Assess risks and opportunities	Prepare Prepare action and disclosure
We narrowed down priority region of direct operations based on TNFD five standards. (Conservation significance, Ecosystem integrity, Low integrity, Water stress, Nature dependencies and impacts)	We identified nature dependencies and impacts key initiatives of each supplychain including upstream, direct operations and down stream by using ENCORE^※1 which is TNFD recommendation tool.	We identified and assessed risks and opportunities of each supplychain including upstream, direct operations and down stream based on identified dependencies and impacts by two factors:impact and potential.	We connect our group business strategy and action with identified risks and opportunities. Then we organized it. This time we disclosed analysed result.

Exploring Natural Capital Opportunities, Risks and Exposure: The assessment tool of nature-related which is developped by The UN Environment Programme World Conservation Monitoring Centre（UNEP-WCMC）and Natural Capital Finance Alliance（NCFA）etc.

Analysis result

We wrote high assessment result of nature-related risks and opportunities in the table below.

Causes	Classification	Risks / Opportunities	Actions
Increased importance of sustainable raw material procurement	Risk	Increase in raw material procurement cost by legislation of raw material procurement step.	Development of product for improvement of recyclability and substitution of sustainable material.
	Opportunities	Improvement of product value by sustainable procurement.	Improvement of raw material traceability precision. Enhancement of raw material management by further tighten raw material related requirement.
Enhancement of nature-related policy	Risk	Increase in operation cost by enhancement of Environmental legislation. (Soil, Air, Water quality, Waste)	Introduction of highly efficient equipment to promote　environmental impact reduction and promotion of the　development of new methods. Enhancement of organisation for circular economy.
Enhancement of nature-related policy	Opportunities	Improvement of corporate value by water resources impact reduction.	Modeling further water resources impact reduction activities as modeling.
Change in evaluation by customers and the consumer value standard (raised environmental awareness, etc.)	Risk	Decrease demand by not being able to meet customer requirement regarding to circular economy.	Development of product for improvement of recyclability and substitution of sustainable material.
	Opportunities	Increase in demand of plant-derived products and lightweight products. Enhancement of competitiveness by developing technology to improve recyclability.	Planning and development of plant-derived products and lightweight products. Improvement of recyclability and promotion of simple　disassembly design.
Worsening of extreme weather, including shortage of water and flooding	Risk	Decrease in sales due to the impact of supplychain disruption on production.	Risk management using a system to manage the range of supplier impact. Selection of logistics routes that minimize the impact of disaster.
	Risk	Decrease in sales due to factory shutdown.	Enhancement of the BCP system. (Creation of manuals and establishment of an information collection/sharing system)

Through analysis

We confirmed nature-related risks and opportunities in our group business.
Based on the results of analysis, we will strengthen our response to risks and opportunities. And we will work on further disclosure based on the TNFD framework.