We recognize climate change response as an important issue (Materiality) that we should prioritize in order to promote sustainable management. The Sustainability Committee, chaired by the President and Representative Director, deliberates on the direction of management, including policies to address risks and opportunities related to climate change, and reports regularly to the Board of Directors for direction and supervision.
The Sustainability Committee is held at least twice a year to deliberate and discuss initiatives to resolve issues related to sustainability (CSR, ESG, SDGs), including climate change.

＞Corporate Governance

In order to understand the impact of climate change on the Group business, we have analyzed risks and opportunities for all businesses in the Group using the following two scenarios:

• The “1.5°C scenario,” in which global temperature rise at the end of the 21st century is kept below 1.5°C and the transition to a decarbonized society is realized
• The “4°C scenario,” in which measures against global warming that surpass the current level are not taken and physical effects are assumed

[Important risks and opportunities]

We identified risks and opportunities for climate change and examined the importance of climate change to the Group and when it might occur.

• Time axis (time of occurrence) - Short term: By around 2025, Medium term: By around 2030, Long term: By around 2050
• Materiality (potential impacts on strategic and financial plans, etc.) - Large: Large impact, Medium: Medium impact, Small: Little impact on the Company

*ZEVs (Zero-Emission Vehicle): Battery electric vehicles (BEV) and fuel cell vehicles (FCV) that do not emit carbon dioxide or other exhaust gases when running

[Policy on climate change risks and opportunities]

The Group will use scenario analysis to identify medium- to long-term risks and opportunities, analyze the impact of its management strategy and financial position, and take measures to respond appropriately to risks, strengthen its competitiveness against opportunities, and acquire new business opportunities. The results will be disclosed and reported to stakeholders through media such as the Company website and corporate reports.

[Future direction of management]

In response to the accelerating shift to EVs in the automotive industry, our core business, our Group has reorganized our existing organization and established the “New Business Promotion Unit” with the aim of responding more quickly than before to these major changes in the business environment, and to strongly promote the “creation and development of new businesses.” In addition to responding to the shift to EVs, we are striving to connect the needs of the automotive industry to new businesses, such as responding to vehicles with internal combustion engines that use CN fuel (such as hydrogen-powered vehicles). In addition, we are also promoting initiatives that leverage existing products and technologies, such as expanding sales of special bearings for EV parts (motors, etc.) manufacturing facilities.
We are also making the most of our core technologies cultivated over many years, and as a contribution to green energy, are continuing to actively develop the market for bearings for wind power generation, for which demand is expected to grow in the renewable energy field. In January 2022, we were selected by the New Energy and Industrial Technology Development Organization (NEDO) for the Next Generation Wind Turbine Technology Development Project (development of sliding bearings for wind turbine main bearings) under the Green Innovation Fund Project “Offshore Wind Power Cost Reduction Project (hereafter, the Project).” Based on the development of next-generation wind turbine element technology to accommodate the growing size of wind turbines, the Project aims to expand the use of offshore wind power generation by reducing the cost of floating wind power generation, which can be installed even in deep sea areas. Through the Project, we will contribute to the social implementation of offshore wind power and the realization of carbon neutrality in 2050.
We will continue to enhance our profitability (increase in sales and share) by refining existing businesses while responding to changes in the business environment by creating and fostering new businesses.

The Company has established policies on the Group-wide risk control and management system, and appropriately manages various risks surrounding its business through the collection of information by the Risk Management Committee that is chaired by the President. The Risk Management Committee is held at least twice a year to set priorities for risks that may have a significant impact on the realization of sustainable management in the Group, taking into account the likelihood that risks will materialize and the degree of impact they will have on our business. We promote measures to mitigate risks based on priority and strengthen risk control. In the current fiscal year, risks related to climate change and natural disasters were identified as priority risks for the Group, and the risk management department in charge of these risks oversees risk management for Group companies.
＞Risk Management