日本触媒（4114） – TCFD report April 2022

TCFD ReportApril 2022Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.Contents1. Aiming to Achieve Carbon Neutrality in 2050 ・・・・・・・・・・・・・・22. Governance System for Climate Change Issues ・・・・・・・・・・・・・33. Risk Management in Relation to Climate Change Issues ・・・・・・・・34.Strategy on Climate Change Issues ・・・・・・・・・・・・・・・・・・44‐1. Materiality (important issue)4‐2.Implementation of scenario analysis related to climate change issues 4‐2‐1．Assumptions for scenario analysis4‐2‐2．Identification of the scope of scenario analysis4‐2‐3．Scientific evidence, etc. used as a reference4‐2‐4．Analysis results based on the 1.5˚C scenario4‐2‐5．Analysis results based on the 4˚C scenario4‐3. Assessment of business impact based on the scenario analysis4‐3‐1．Evaluation results on opportunities related to climate change4‐3‐2．Evaluation results on risks related to climate change5. Metrics and Targets in Relation to Climate Change Issues ・・・・・・125‐1．Efforts to reduce CO2 emissions from the production stage (Scope 1, Scope 2) by 2050 5‐2．Efforts to reduce CO2 emissions through the supply chain (Scope 3)5‐3．Certification of Environmental Contribution Products6. Development of Products that Help Address Climate Change Issues ・・167.Conclusion ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・19Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.11. Aiming to Achieve Carbon Neutrality in 2050In April 2021, our company announced Nippon Shokubai Group’s Long‐term vision “TechnoAmenityfor the Future,” which outlines our goals for the next 10 years by 2030.In this vision, we specified the following three goals for 2030, and set three transformations inorder to achieve these goals.* Provide materials and solutions required by people and society* Become a chemical company that keeps evolving by identifying social trends* Develop with various stakeholders inside and outside the company[1] Business Transformation[2]  Strategic Transformation forEnvironmental Initiatives[3]  Organizational TransformationTransform portfolio from existing to growth fieldsPromote sustainability to realize carbon neutrality by FY2050Transform into an organization with sustainable growth and a company where diverse human resources are motivated to workOf these, we believe that the activities aiming for achievement of carbon neutrality by reduction ingreenhouse gas (GHGs, especially CO2) emissions are most important for [2] Strategic Transformationfor Environmental Initiatives. As a concrete method of approach, we will first work to reduce CO2emissions from our own production (Scope 1, Scope 2) through conversion of raw materials intobiomass, promotion of energy conservation, improvement in processes, adoption of green energy,etc. In addition, in order to reduce CO2 emissions in the supply chain (Scope 3), we will activelypromote the spread of Environmental Contribution Products, develop carbon recycling technology,and recycle resources, including superabsorbent polymer (SAP).Goals in 2030, 2050Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.22. Governance System for Climate Change IssuesOf all the environmental issues, climate change is a company‐wide issue that extends beyond themanufacturing and research stages. Therefore,it has been decided that the TechnoAmenityPromotion Committee (Chair: President), which determines the core policies and strategies for ourcompany management with regard to sustainability, should examine the issue intensively so that ouractivities can be accelerated.The Board Meeting receives reports on policies, strategies, plans, and results related to climatechange issues that are discussed in this Committee and provides necessary instructions.Governance System for Climate Change IssuesBoard MeetingDirectionReportTechnoAmenity Promotion CommitteeDetermines the group’s policies and strategies relatingto promoting sustainability initiatives. Instructs each department to create plans and measuresand evaluates their performance and progress. （Includes response to climate change issues）3.Risk Management in Relation to Climate Change IssuesIn the overall risk management of our company group, we work by classifying the risks into seriousGroup‐wide risks and department risks.For serious Group‐wide risks, potential serious risks underlying execution of the Group’smanagement strategies, sustainable improvement of corporate value, and acquisition of trust fromstakeholders are subject to risk management, and we have established a system in which the BoardMeeting identifies and assesses the risks, decides whether they should be addressed, and supervisesthe status of risk management by the executive section.For department risks, on the other hand, potential risks underlying execution of business strategiesor business operations by each department or affiliated company are subject to management, andwe have established a system in which responses to the risks are taken promptly.Of these, any issues with insufficient sustainability response are considered serious Group‐widerisks, and management is implemented by the TechnoAmenity Promotion Committee. Regardingclimate change issues in particular, we recognize it as an important social issue to be solved, and werespond flexibly, including establishment of subcommittees as necessary.Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.34.Strategy on Climate Change Issues4‐1. Materiality (important issue)The TechnoAmenity Promotion Committee specified five materiality items that are importantin order for our company to fulfill its social responsibility and conduct business sustainably.Of these, we are intensively examining how to respond to climate change issues, which isof particular urgency and importance.Materiality (important issue) Promote climatechange responseStrengthencorporategovernanceHuman resourcedevelopment andpromotion of activeparticipationPromote safe and stable production activitiesContribute to solving  customer issues4‐2.Implementation of scenario analysis related to climate change issuesIn March 2021, our company endorsed the recommendations of the Task Force on Climate‐relatedFinancial Disclosures (TCFD). Taking this opportunity, we conducted a scenario analysis ofopportunities and risks related to climate change issues, which had been conducted before, again inline with the TCFD recommendations.Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.44.Strategy on Climate Change Issues4‐2‐1. Assumptions for scenario analysisIn the scenario analysis, we focused on the 1.5˚C scenario, which is the scenario for a rapidtransition to low‐carbon, and the 4˚C scenario, which predicts higher global warming resultsand more serious physical impacts, based on the Paris Agreement goal to “pursuing efforts tolimit the global temperature increase to 1.5˚C above pre‐industrial levels” and the SixthAssessment Report by IPCC.Since our Group deals with chemical products at the upstream of the value chain to theproducts at the downstream, we can assume many scenarios. By identifying the scope asshown below, we believed that we would be able to respond to the climate change issuemore efficiently by focusing our analysis on more important scenarios.Global surface temperature change relative to 1850–1900Source: IPCC AR6 Figure SPM. 84‐2‐2.Identification of the scope of scenario analysisIn conducting scenario analysis, we specified 2030 as the subject year for analysis whileaiming to achieve carbon neutrality in 2050.[1] the key growth areas for our company business,[2] the risks and opportunities associated with climate change that are likely to impact the[3] the potential impacts of climate change across the value chainas the scope of analysis.We evaluated the opportunities and risks for 2030 based on the above time frame andWe also specifiedbusiness, andbusiness scope.Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.54.Strategy on Climate Change Issues4‐2‐3. Scientific evidence, etc. used as a referenceWe used the scenarios as shown in the following table in order to analyze the businessenvironment for our company based on various published scenarios, as well as forecastmaterials derived from these scenarios, and organize the worldview of the industry centeringon new entrants, sellers, buyers, and our own company.CO2 emissions (global)Price of carbon (advanced countries)PresentWorld with 1.5˚C increaseWorld with 4˚C increaseSource36064 Million tonnes (Mt)16834 Mt (2040)IEA ETP202063 $/t (2025)140 $/t (2030)IEA WEM2020CO2 emission coefficient for electric power companies (Japan)0.444 kg‐CO2/kWh(2019)0.37 Kg‐CO2/kWh (2030)Action Plan for the Electricity Industry for Achieving a Low‐Carbon Society by the Federation of Electric Power Companies of JapanCarbon emission goals and policiesElectric power generation (global)Wind powerSolar power(% indicates the proportion)Hydrogen production using renewable electricity (global)Hydrogen power generation (Japan)1423 TWh (5%)665 TWh (2%)4770 TWh (15%)4315 TWh (14%)3361 TWh (10%)2764 TWh (8%)IEA WEO2020833 TWh (2030)IRENA GET2050Agency for Natural Resources and EnergyBasic hydrogen strategy100 GW (2030)300 GW/y (2030)5,300,000 units (2030）4.67TWh(2017)11.89–15.27TWh (2030)500,000 units or less (2010)1,570,000 units(2030)Solar power generation (global)17 GW/y (2010)IRENA GET2050Fuel cells (ENE‐FARM)350,000 unitsThe 5th Strategic Energy PlanTechnology marketStorage batteries (global)6.62–7.82 TWhIRENA ERCM2030Electric vehicles (global)IRENA GET2050CO2 capture160 Mt (2020)650 Mt (2030)IEA ETP2020 CCUWaste recycling (EU)46% (2017)60% (2030)Directive (EU) 2018/851Frequency of flood occurrenceTwofold (2˚C)Fourfold (2˚C)the Ministry of Land, Infrastructure, Transport and TourismRecyclingNatural disastersHigh tide (Tokyo Bay)5% increase13% increasethe Ministry of the Environment‐‐‐‐‐‐‐‐‐‐‐‐‐ETP: Energy Technology PerspectivesWEO: World Energy OutlookERCM: ELECTRICITY STORAGE AND RENEWABLES:COSTS AND MARKETS TO 2030CCU: Special Report on Carbon Capture Utilisation and Storage CCUS in clean energy transitionsGET: Global Energy Transformation A Roadmap To 2050WEM: World Energy ModelCopyright NIPPON SHOKUBAI CO., LTD. All rights reserved.64.Strategy on Climate Change Issues4‐2‐4. Analysis results based on the 1.5˚C scenarioThe 1.5˚C scenario calls for a strong response to the transition to a decarbonized society inorder to significantly mitigate the effects of climate change.As a result of this transition, the market is expected to shift to socialinfrastructurecentered on the use of renewable energy, as well as products that support it. Specificmeasures include electrification of automobiles, provision of materials related to energystorage, promotion of recycling, and utilization of biomass raw materials.In addition, the introduction of decarbonization laws and regulations, and increaseddemands from customers and investors are expected.Analysis results based on the 1.5˚C scenario (low carbon transition scenario)Sellers(raw material suppliers) Rapid rise in procurement costs due to carbon regulations Increased procurement and manufacturing costs due to increased use of biomass raw materials and recycled materials Increase in production cost as renewable energy becomes mainstream Increased costs for countermeasures against severe disastersSellers(energy) Reduction of CO2 emission coefficient for electricity by increasing the ratio of renewable energy sources Increase in the unit price of electricityNew entrants Petrochemical products using certification of carbon offsets and labeling of CO2 emissions Basic chemical products derived from biomass Basic chemical products made from CO2Industry Utilization of biomass raw materials Activation of technology investments, etc. for energy conservation and decarbonization of production processes In the market, materials related to decarbonization, CO2 capture and recycling, hydrogen, and renewable energy will become trends Demands for storage batteries and fuel cell materials, especially for EV‐related applications and hydrogen utilization Reduction of CO2 through promotion of material and chemical recyclingBuyers (customers) Demands for materials derived from biomass Demands for materials related to low‐carbon and decarbonization products Abolition of internal combustion engines using fossil fuels and the accompanying electrification Demands for certifications and labeling Demands for environmental contributions from the value chain Selection of products for which carbon prices have not been transferredGovernment Introduction of a carbon tax Introduction of emissions trading Implementation of policies to promote energy conservation, renewable energy, and low carbon emissions, including increased subsidies Implementation of policies to achieve practical use of electric vehicles and a hydrogen society Strengthening of recycling regulationsInvestors Low‐carbon and decarbonization become important investment requirementsCopyright NIPPON SHOKUBAI CO., LTD. All rights reserved.74.Strategy on Climate Change Issues4‐2‐5. Analysis results based on the 4˚C scenarioAccording to the IPCC Assessment Report, the change in climate is expected to be similarbetween the 1.5˚C and 4˚C scenarios as of 2030, but the differences between the scenarioswill increase after 2030.The 4˚C scenario is an extension of the current one, and low carbon and decarbonizationwill not progress as much as in the 1.5˚C scenario. In 2030 and later, we will not be able toavoid the various physical risks associated with intensifying severity of natural disasterscaused by rising temperatures and the chronic temperature increase.Specifically, it is expected that business operation costs will inevitably increase due to theincreasing difficulty in obtaining biomass raw materials, physical damages to manufacturingfacilities caused by abnormal weather, supply chain disruptions, and increased utility costs.Analysis results based on the 4˚C scenario (physical climate scenario)New entrants Petrochemical products using certification such as carbon offsets and labeling of CO2 emissions will remain with limited supply, making it difficult for new businesses to enter the market Biomass‐derived basic chemical products and basic chemical products made from CO2 are distributed only in limited marketsIndustry No major changes as the conventional renewable energy and energy conservation measures are implemented Material and chemical recycling does not see much progress Manifestation of physical risks such as flooding and strong winds to production bases Decline in labor productivity due to heat stress Increase in costs of BCP measuresSellers(raw material suppliers) No introduction of carbon regulations No control over the adoption of biomass raw materials and percentage of recycled material use Renewable energy does not become mainstream Increased costs for countermeasures against severe disasters Manifestation of physical risks of raw material suppliers such as fossil raw material mining sites and oil refining plantsSellers(energy) CO2 emission coefficient for electricity does not decrease as the ratio of renewable energy sources does not increase The unit price of electricity does not increase muchBuyers (customers) Demands for materials derived from biomass are limited Demands for materials related to low‐carbon and decarbonized products do not increase as much as in the 1.5˚C scenario Measures for certifications and labeling also do not increase as much as in the 1.5˚C scenario No control over the demands for environmental contributions from the value chain Transfer of carbon prices is not implemented as much as in the 1.5˚C scenarioGovernment Postponement of the introduction of the carbon tax Introduction of emissions trading is postponed Policies to promote energy conservation, renewable energy, and low carbon emissions, including increased subsidies, are implemented, but are not promoted as much as in the 1.5˚C scenario Implementation of policies to achieve practical use of electric vehicles and a hydrogen society does not progress Recycling regulations are not strengthenedInvestors Low‐carbon and decarbonization do not become important investment requirements as much as in the 1.5˚C scenarioCopyright NIPPON SHOKUBAI CO., LTD. All rights reserved.84.Strategy on Climate Change Issues4‐3.Assessment of business impact based on the scenario analysisWe summarized the degree of financial impact as shown in the table below, based on ascenario analysis that took into consideration market changes, changes in corporateactivities, policies, laws and regulations that promote the transition to a low‐carbon societyand a recycling‐oriented society, stakeholder evaluations, and so on. Our company views anypositive financial impact as an opportunity and any negative financial impact as a risk, andassessed the degrees of financial impact on a scale of large, medium, and small based on theimpact on the related financial indicators.Business opportunities include increasing demands for materials that contribute to low‐carbon and decarbonization.In particular, automobiles are expected to reduce energyconsumption due to the acceleration of the switch from gasoline engines to electric motorsand further reductions in vehicle weights. We believe that our company’s supply of materialsrelated to lithium‐ion batteries and automobile‐related materials that help reduce vehicleweight will contribute to this.In addition, there are power plants and steelworks where it is difficult to significantlyreduce or eliminate carbon dioxide emissions for the time being. Efforts are being made tocapture the carbon dioxide emitted and use the captured carbon dioxide effectively as aresource. In such fields, we believe that our company’s development of CO2 absorbers andmethane production catalysts can help solve these problems.Moreover,looking ahead to a hydrogen society, our company is also expected tocontribute to the series of processes including electrolysis of water using renewable energy,conversion of hydrogen produced through electrolysis into ammonia, and removal of harmfulsubstances during ammonia combustion, though provision of our catalysts and materials.In fields that utilize renewable energy to eliminate fossil fuels, expectations for theimpact on business opportunities is alsomaterials industry are high, and the financialconsidered to be significant.Risks include the loss of business opportunities as we fail to be selected by customers dueto delays in the development of technologies related to climate change and the greening ofenergy and raw materials. With regard to these risks, we will flexibly focus on low‐carbonand decarbonization‐related development themes to meet market demands and promoteadoption of non‐fossil raw materials and fuels.We are also examining measures to deal with possible risks with the assumption that it ispossible to shift from the 1.5˚C scenario to the 4˚C scenario in the future. As formanufacturing facilities, we will continue to promote resilience measures for manufacturingfacilities and strengthen BCP in preparation for supply chain disruptions in the future. Wehave already taken some measures against natural disasters.In addition, it is expected that long‐term climate change will make it difficult to procureplant materials, so we have begun to consider the procurement of diverse materials as wellas alternative materials.Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.94.Strategy on Climate Change Issues4‐3‐1. Evaluation results on opportunities related to climate change1.5˚C scenarioMajor opportunitiesResponse by Nippon ShokubaiEvaluationResultsIncrease in demands for battery materials, etc. due to electrification of automobilesLargeMaterials related to lithium‐ion batteriesMaterials for electric vehicle‐related componentsIncrease in demands for products related to CO2absorption, capture, and recycling technologies, and fixation technologiesUtilization of hydrogen/ammonia synthesis/decomposition catalysts‐ Promotion of hydrogen‐related technology development‐ Increase in adoption of exhaust gas catalysts in conjunction with fuel conversion to ammoniaIncrease in demands for Environmental Contribution Products that contribute to energy conservation during useMediumCO2 absorbentsMethane production catalystsLargeSeparator for alkaline water electrolysisFuel cell materialsAmmonia synthesis/decomposition catalystsDenitrification catalystsLargeMaterials for automobile weight reduction, materials related to energy conservation, etc.Increase in demands for recyclable productsLargeDissemination of energy conservation and GHG reduction facilitiesLargePromotion of disposable diaper (superabsorbent polymer) recyclingCatalysts for wet oxidation wastewater treatmentDevelopment of unique energy conservation processesExpansion in business opportunities by responding to climate changeIncrease in demands for Environmental Contribution ProductsLargeUse of biomass raw materialsGreening of energyLargePromotion of development and enhancement of certification of Environmental Contribution ProductsTechnology marketIncrease in demands for products related to low‐carbon and decarbonizationPromotion of recyclingPolicyLaws and regulationsRise in carbon priceLaws, regulations, and policies related to carbonRequirement for utilization of biomass raw materials and introduction of energy and fuel with low CO2 emissionsRequirements for products that help reduce CO2emissions during useCustomer requests and reputationExternal evaluation of efforts against climate changeImprovement in corporate value through environmental ratingsMediumActive disclosure of information related to climate changeCopyright NIPPON SHOKUBAI CO., LTD. All rights reserved.104.Strategy on Climate Change Issues4‐3‐2. Evaluation results on risks related to climate change1.5˚C scenarioMajor risksResponse by Nippon ShokubaiTechnology marketIncrease in demands for products related to low‐carbon and decarbonizationPromotion of recyclingPolicyLaws and regulationsRise in carbon priceLaws, regulations, and policies related to carbonRequirement for utilization of biomass raw materials and introduction of energy/fuel with low CO2 emissionsRequirements for products that help reduce CO2 emissions during useCustomer requests and reputationDecrease in market share due to delays in decarbonization research and developmentDecrease in sales of products using petroleum‐derived raw materialsTechnical difficulties of recycling technologyIncrease in raw material and energy procurement costsIncrease in costs due to installation of energy conservation and GHG reduction facilitiesFocus on development themes related to low‐carbon and decarbonizationDevelopment of manufacturing processes and products that generate less wasteDevelopment of SAP recycling technologyUtilization of energy certificatesGreening of energy and use of biomass raw materialsProcess efficiency improvementEvaluationResultsLargeLargeReplacement with other companies’ productsPoor reputation among customers and investors due to failure to advance decarbonizationLargeUtilization of biomass raw materialsGreening of energyLargePromotion of development of Environmental Contribution ProductsExternal evaluation of efforts against climate changeDecrease in corporate value through environmental ratingsMediumActive disclosure of information related to climate change4˚C scenarioMajor risksResponse by Nippon ShokubaiFlooding and destruction of manufacturing facilities due to high tides and strong windsProduction stoppages and increased loss of sales opportunities due to supply chain disruptions caused by floodsEvaluationResultsMediumStrengthening of measures against wind and flood damagesResilience measuresLargeStrengthening of BCPAcuteIntensifying severity of disastersChronicRise in average air temperatureDifficulty in procuring biomass raw materialsLargePromotion of diversification in raw material procurementSecuring of alternative raw materialsIncrease in the costs of heat stroke countermeasuresSmallFurther improvement of work environmentsPromotion of digital transformation useCopyright NIPPON SHOKUBAI CO., LTD. All rights reserved.115. Metrics and Targets in Relation to Climate Change IssuesIn March 2020, our company announced a target to reduce GHG emissions by 10% by 2030,with 2014 as the base year, in order to reduce GHG emissions from our business activities(Scope 1, Scope 2).However, in April 2021, the Japanese government announced a major revision to its GHGemission reduction target for 2030, which is based on 2013, from 26% to 46%.Furthermore, the Sixth Assessment Report by IPCC, released in 2021, found that thetiming when the mean global temperature will increase by 1.5˚C or more compared to pre‐industrial levels has been accelerated by 10 years, compared to the Fifth Assessment Report(2014 version).In response to this, our company reviewed and revised its GHG emission reduction targetwith 2014 as the base year for the entire country including our Group companies from 10%to 30% for 2030, and announced it in November 2021.In addition, in order to promote the development and popularization of EnvironmentalContribution Products, our company has set new targets for the total sales revenue (ourcompany only and Group companies) of Environmental Contribution Products among theoverall sales revenue as 55 billion yen in FY 2024 and 135 billion yen in FY 2030, comparedwith 29 billion yen in FY 2020 (see page 15 for details about Environmental ContributionProducts in the table below).Metrics and targets related to the climate change issue for 2030FY 2014 resultFY 2020 resultFY 2030 targetGHG emissions: Scope 1 + 2 (1,000 t‐CO2, in Japan)Base reduction rate for FY 2014Sales revenue from Environmental Contribution Products(billion yen, including Group companies)820‐‐79042957030135Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.125. Metrics and Targets in Relation to Climate Change Issues5‐1.Efforts to reduce CO2 emissions from the production stage (Scope 1, Scope 2) by 2050CO2 accounts for the majority of GHG emissions from our Group’s business activities. CO2emissions from business activities include CO2 from energy use in product productionactivities, CO2 from oxidation reaction processes, and CO2 from the treatment of wastesgenerated in production activities.By 2030, we will promote the conversion of raw materials into biomass to the extentpossible, and reduce CO2 emissions through measures centering on promoting energyconservation, promoting the use of green energy, process improvements, catalyst efficiencyimprovements, and so on.While we will promote the above measures in 2030 to 2050, we also plan to promote theexpanded use of biomass raw materials, use of recycled raw materials, use of green fuels(hydrogen, ammonia), and demonstrate carbon recycling technology (CO2 capture andrecycling).We aim to achieve carbon neutrality by achieving the goals for the above measures, whilealso capturing and recycling biomass‐derived CO2.Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.135. Metrics and Targets in Relation to Climate Change Issues5‐2.Efforts to reduce CO2 emissions through the supply chain (Scope 3)In order to solve the issue of climate change, it is important to reduce CO2 emissions not onlyfrom the manufacturing stage of our products but also throughout the entire supply chain,including the stages of use and disposal. Our company offers products (EnvironmentalContribution Products) that reduce CO2 emissions during the stage of product use comparedto conventional products, and is developing more new Environmental Contribution Products.We also promote developments of new technologies (such as CO2 conversion catalysts)that will help reduce CO2 emissions throughout the supply chain.We are also working on the development of a recycling promotion system for diaperscontaining superabsorbent polymer (SAP) to reduce CO2 emissions by recycling carbon.Contribution to reduction of CO2 emissions from the supply chain* Development and increased popularization of Environmental Contribution Products ‐ Contribution to reductions in CO2 emissions through energy conservation during use‐ Contribution to reductions in CO2 emissions by being incorporated into products that contribute to energy conservation‐ Contribution to reduction in CO2 emissions through the adoption of biomass raw materials* CO2 absorption and recycling‐ CO2 absorption materials, CO2 conversion catalysts, etc.* Development and social implementation of material recycling and chemical recycling‐ Promotion of recycling of disposable diapers containing superabsorbent polymer (SAP)Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.145. Metrics and Targets in Relation to Climate Change Issues5‐3.Certification of Environmental Contribution ProductsChemical industrial products use global resources from the Earth during production and emitGHGs and waste, thereby affecting the environment. However, when we view the entire lifecycle from the procurement of raw materials to the disposal of final products, the presenceof these chemical industrial products may contribute to the reduction of environmentalloads.We evaluate how our products contribute to reducing environmental loads, including GHGemissions, based on how they are used throughout the supply chain, in the facilities thatproduce the products familiar to us and in the social infrastructure.Starting in FY 2019, our company established internal standards and an internalcertification system to certify products as “Environmental Contribution Products” based oncheck items and numerical data.Products that have been certified by the certification committee are reported to theResponsible Care Promotion Committee and published on our website and in RC Reports.Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.156. Development of Products that Help Address  Climate Change IssuesElectrolyte for lithium‐ion batteries: IONELTMSeparator for alkaline water electrolysis, contributing to the spread ofgreen hydrogen and the reduction of CO2emissionsLithium‐ion batteries are expected to be applied to variousapplications such as electric vehicles, mobile phones, stationarypowersupplies, and drones.In 2013, Nippon Shokubaideveloped the world’s first industrial production process forLiFSI (trade name IONELTM) using a proprietary synthesis andThe separator for alkaline water electrolysis is used for alkalinewater electrolysis*1, a technique attracting attention as theproduction method for green hydrogen*2. Hydrogen energy doesnot emit CO2 when used and therefore its applications have beenexpanding as fuel cells for automobiles and houses.purification method, and has obtained numerous patentsThe separator has a significant impact on the hydrogenworldwide.production efficiency and therefore is required to have twoIONELTM is high in purity and quality, and exhibits stablecharacteristics: high electrolysis efficiency (low ionic resistance)electrochemical properties.It has been found that use ofIONELTM as an electrolyte for lithium‐ion batteries deliversand not cross leaking the generated hydrogen and oxygen (highgas barrier property). Under the severe conditions of high‐effectssuch as extension of battery life over a widetemperature, high‐concentration alkaline water, the number oftemperaturerange,improvementofinput/outputboth practical and durable separators is limited. However,characteristics,improvement in storage characteristics, andNippon Shokubai has succeeded in the development of a productsuppression of swelling.It has already been adopted andthat ensures both of these characteristics by applying our uniquecertified as an electrolyte for many lithium‐ion batteries inorganic/inorganic hybrid technology and sheet manufacturingJapan and outside Japan, and its applications range widelytechnology.including automotive, consumer, and stationary. It is expectedThis separator is expected to show several advantages,to be adopted more widely and further contribute as a low‐including reduction of power consumption and improvement ofcarbon, recycling‐oriented clean energy technology in thethe purity of the hydrogen produced, thereby contributing to thefuture, and we plan to further increase our production capacity.spread of green hydrogen and a reduction in CO2 emissions.*1 Method of water electrolysis using strong alkaline solution,such as potassium hydroxide*2 Hydrogen produced using renewable energy with reducedCO2 emissionsAppearance of IONELTMImage of alkaline water electrolysisSeparator for alkalinewater electrolysisCopyright NIPPON SHOKUBAI CO., LTD. All rights reserved.166. Development of Products that Help Address  Climate Change IssuesMaterials for seawater desalination and wastewater treatment: Osmotic pressure generating agentsA new value: reduction of waste by switching from disposable to recycled useOsmotic pressure generating agent (Draw Solute or DS) is a keyDisposable diapers are mainly composed of pulp, plastic, and SAP.component of the Forward Osmosis (FO) system, a next‐Recycling of used diapers has been put into practice by Totalgeneration seawater desalination technology.Care System for a part of their raw materials. The recycled pulpThe DS our company developed extracts water from seawaterhas been effectively used as raw materials for building materialswith its high osmotic pressure within the FO system, and then(e.g., exterior and interior wall materials) and plastic has beenseparatesitfrom water by heating, enabling efficientthermally recovered as solid fuel.freshwater extraction.Nippon Shokubai began to examine the recycling technologyBy using factory waste heat and solar heat for the heat sourcefor SAPs, which has not been in practice, and succeeded in theused in this process, it is possible to conserve energy, reducedevelopment of new recycling technologies jointly with LivedoCO2 emissions, and reduce costs when compared to existingCorporation, a major manufacturer of diapers for adults, andseawater desalination technologies such as reverse osmosisTotal Care System. This technology consists of two techniques:(RO) systems.In addition, our company’s DS can be used1. a technique to increase the recovery rate of paper pulprepeatedly, and has a reduced environmental impact.through processing SAP that had been swollen from absorbingMoreover, the FO system can be applied to industrialurine, to improve the separation from paper pulp, and 2. awastewater treatment applications (Zero Liquid Discharge ortechnique to collect SAP while minimizing the performanceZLD). It is therefore attracting attention as a technology that candegradation of SAP and also paying attention to energy savingmeet increasingly stringent global wastewater regulations.and water quality conservation of rivers and other bodies ofwater.These technologies are applicable to all SAPs produced byNippon Shokubai, as well as to various SAPs of other companies.We will improve these technologies to a practical level, advancethe development of easy‐to‐recycle materials and treatmenttechnology, and work with the two partner companies to build arecycling system.Image of a forward osmosis systemCopyright NIPPON SHOKUBAI CO., LTD. All rights reserved.176. Development of Products that Help Address  Climate Change IssuesAcrylic acid/superabsorbent polymer made from biomass raw materialsCarbon dioxide absorption liquid: Amino alcohol(Product of Nippon Nyukazai Co., Ltd.)Acrylic acid is widely used as a raw materialfor variousAmino alcohol is a gas absorbent that absorbs acidic gases suchproducts,including superabsorbent polymers(the water‐as CO2 and H2S. It absorbs CO2 and H2S and releases them easilyabsorbing component of disposable diapers) and acrylic esterswhen heated, requires little heat to absorb and dissipate, and(the main ingredients and additives in paints and adhesives).offers fast absorption speeds. It is used for decarboxylation andHowever, the final products—disposable diapers and so on—desulfurization in thermal power plants,steelworks, andbecome a source of CO2 emissions when disposed of andpetroleum refineries that generate large amounts of CO2, andincinerated after use.gas refining in the chemicalindustry.It contributes to theTherefore, Nippon Shokubaiis investigating the use ofcapture and storage of CO2, which is essential as a climatebiomass‐derived propylene instead of petroleum‐derivedchange countermeasure, and can be expected to significantlypropylene, and is developing a new manufacturing method forreduce emissions.acrylic acid from biomass without going through propylene.Since biomass absorbs and fixes CO2 in the air throughphotosynthesis, the CO2 emitted during incineration can beregarded as carbon neutral,leading to a reduction in CO2emissions.We aim to start the commercial production of biomass‐derived acrylic acid that does not go through propylene as earlyas possible by 2030, by working to develop the mass productiontechnology during our medium‐term management plan from FY2022 to FY 2024. We will also expand its use to the productionof superabsorbent polymer and acrylic esters, and aim toreduce CO2 emissionsthroughoutthe lifecycles of ourcustomers’ final products.Exhaust gas collected from acidic gasAcidic gas collectionRegenerative absorbentrewot noitprosbArewot noitarenegeRExhaust gas containing acidic gasAbsorbent containing acidic gasAcidic gas absorption process flow (example)Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.187.ConclusionOur Group has been working under the group mission “TechnoAmenity—Providingprosperity and comfort to people and society, with our unique technology,” and we believethat this mission is also consistent with the Sustainable Development Goals (SDGs).In our response to the changes in the environment, including climate change issues, wewill contribute to the realization of a carbon‐neutral and sustainable society by minimizingrisks, maximizing opportunities, and providing innovative technologies and products.Copyright NIPPON SHOKUBAI CO., LTD. All rights reserved.19