Climate Change: Targets
Key GHG Metrics and Disclosure Highlights
MC has set GHG emissions reduction targets consistent with the Paris Agreement, which aims to limit global warming to well below 2°C and preferably 1.5°C above pre-industrial levels by the end of the century. We are advancing a variety of measures to achieve these targets.
We have set GHG emissions reduction targets on a consolidated basis and work closely with our operating companies to collect emissions data and implement reduction initiatives on a consolidated basis. Furthermore, we utilize our environmental management system (EMS) to gather essential information for policy planning. In FY2020, we expanded the scope of our survey through a major update to the environmental performance survey system, and we continue to improve the accuracy and timeliness of both qualitative and quantitative data on our GHG reduction initiatives.
Targets
MC is committed to creating MC Shared Value by simultaneously decarbonizing and reinforcing its portfolio in accordance with the net zero by 2050 and 1.5°C targets in line with the Paris Agreement. To achieve this, we have set the following three goals toward the realization of a decarbonized society.
1) GHG Emissions Reduction Targets
- Net zero GHG emissions by 2050, and a detailed reduction plan with interim targets set for FY2030.
- Emissions halved by FY2030 (compared to FY2020 levels), primarily through portfolio replacement driven by divestment of thermal power assets.*
*Applies to Scope 1 and 2 emissions as well as Scope 3 Category 15 (Investments, hereinafter ”Scope 3-15”)
We have been using the equity share approach to calculate GHG emissions. However, to clarify the scope of responsibility for our emissions, we will adopt the financial control approach starting in FY2025. Under this approach, GHG emissions from our subsidiaries and joint operations will be disclosed as Scope 1 and 2 emissions, while those from affiliate companies will be disclosed as Scope 3 Category 15 emissions. All of these will be included in our reduction targets. (For information on the restatement of base year emissions in accordance with the change to the financial control approach, please refer to the section ”Our Past Initiatives”1 below.)
Our Progress to Date
MC continuously tracks progress against its reduction targets. Actual performance figures for Scope 1 and 2 GHG emissions toward our reduction target are as follows:
GHG Emission Reduction Plan and Achievements to Date
2) Non-Fossil % in Power Generation Business
We aim to reduce existing thermal power capacity and transition to zero-emission thermal power, targeting 100% non-fossil by 2050.
3) Renewable Energy Power Generation Capacity
We plan to double MC's renewable energy power generation capacity by FY2030 compared to FY2020 levels.
Scope 1 & 2
In order to clarify the scope of responsibility for our emissions, we will adopt the GHG Protocol’s financial control approach for emissions calculation as of FY2025. (As indicated in the diagram above, figures for fiscal years 2020 and 2023 have been recalculated based on the financial control approach.) Under this approach, GHG emissions from subsidiaries and joint operations will be disclosed as our Scope 1 and 2 emissions, while emissions from affiliate companies will be disclosed as Scope 3 Category 15 emissions.
Scope 3
Since Scope 3 emissions are generated by other entities within our value chain, reducing Scope 3 emissions requires collaboration with a wide range of partners across our supply chains.
As a company operating across numerous sectors with extensive industry connections, we believe that pursuing initiatives that contribute to societal decarbonization (i.e. generating avoided emissions) will help reduce our Scope 3 emissions across multiple categories.
We will continue working toward reducing our Scope 3 emissions through partnerships with stakeholders and by advancing businesses that contribute to societal decarbonization.
Please refer to the ESG Data at the link below for details on GHG emissions (Scope 1, 2, & 3).
【Our initiatives in collaboration with partners across our supply chain】
Category／Initiatives | Details | |
|---|---|---|
Category 1 | Conforming with MC’s Policy for Sustainable Supply Chain Management | Requesting suppliers to protect the environment, including through GHG reduction, and confirming compliance with MC’s Policy for Sustainability Supply Chain Management through an annual survey of suppliers subject to MC’s Sustainable Supply Chain Survey |
| Procurement of low-emission materials for urban development | Adopting materials such as CO2-absorbing concrete and low-carbon asphalt paving for the urban development business | |
| Collaboration with supplier farms | Planting trees at farms within the supply chain of our food ingredient import operations | |
Category 4 | Streamlining logistics | Improving logistics efficiency through DX initiatives in the food logistics business |
Category 10 | CO2 capture demonstration project | Conducting CO2 capture demonstration projects at steel-making plants in collaboration with multiple partners |
Category 11 | Initiatives regarding next-generation fuels | Climate Change : Initiatives | Environment | Sustainability | Mitsubishi Corporation |
Initiatives regarding CCS／CCUS | Climate Change : Initiatives | Environment | Sustainability | Mitsubishi Corporation | |
| Category 13 | Leasing low-emission construction equipment | Introducing construction equipment with lower environmental impact into the leasing business |
Avoided Emission
Our Efforts to Reduce Emissions
We regard avoided emissions as a quantitative indicator for measuring our contribution to reducing GHG emissions across society and the extent to which we are capturing business opportunities associated with decarbonization.
What are Avoided Emissions?
Avoided emissions refer to the quantified reduction or mitigation of GHG emissions achieved by providing low-emission products and services that help reduce society’s overall GHG emissions, compared to a baseline scenario in which conventional products or services are used.
The basic formula we use for calculating avoided emissions is as follows.
Flow Basis (Lifetime)
This approach evaluates annual avoided emissions by calculating the difference between CO2 emissions from our products manufactured over their entire lifecycle, compared to emissions under a baseline scenario. This category includes materials and other products essential for EVs and similar end-use products.
Stock Basis (Single Year)
This approach evaluates avoided emissions generated within the evaluation year from our products and services. This category covers avoidance from renewable energy projects and similar initiatives.
The term “avoided emissions” includes not only the amount of carbon avoided by our products and services, but also the amount of carbon captured and removed.
Our Avoided Emissions
We have selected and assessed the following products that contribute to decarbonization and generate quantifiable avoided emissions.
In principle, calculations are based on production and operating volumes, but forecasts are used for sales volumes and other data that have not yet been compiled for certain products.
Examples of projects that contribute to avoided emissions that are in the planning stages or will begin operations in the near future
We have estimated avoided emissions for FY2025 and beyond for projects that have not yet begun operations / provision of services, or will begin operations soon. In the future, actual avoided emissions will be calculated based on each project’s operational performance.
- Renewable Energy Power Generation Business
- Through the operation of solar, onshore wind, hydro, and offshore wind power generation facilities currently under construction, we expect avoided emissions to increase by approximately 470,000 tons per year on a stock basis.
- *The estimated avoided emissions shown above are subject to change depending on actual operations and sales performance of commercial products.
Supplementary Information
【Points to note when calculating the Company's avoided emissions】
- In calculating the avoided emissions, we use actual (forecast) values and publicly available information whenever possible. However, when data is not readily available, assumptions and scenarios are applied for calculation purposes.
- We will continue refining calculations and disclosure of avoided emissions based on ongoing international discussions and trends.
【Examples of guidelines used as reference】
- GX League "Basic Guidelines for Disclosure and Evaluation of Climate-related Opportunities" (2023)
- WBCSD/WRI "GHG Protocol Corporate Accounting and Reporting Standard" (2019)
- WBCSD/Net Zero Initiative "Guidance on Avoided Emissions: Helping Business Drive Innovations and Scale Solutions Towards Net Zero" (2023)
- Ministry of Economy, Trade and Industry "Guidelines for Quantifying GHG Emission Reductions of Goods or Services Through Global Value Chain" (2018)
- The Institute of Life Cycle Assessment "Guidelines for Assessing the Contribution of Products to Avoided Greenhouse Gas Emissions" (2022)
- Japan Chemical Industry Association "Guidelines for assessing the Avoided Emissions" (2012)