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Action Plan for the Environment

Identification of materiality (priority issues)

During the formulation of the Endless Green Program 2018, new Action Plan for the Environment, the Daiwa House Group newly extracted the materiality in consideration of the importance to our business and the demands and expectations of society regarding our environmental initiatives. We identified the priority issues with reference to the opinions of experts.

For the Endless Green Program 2018, we compared our action levels for the priority issues and other issues identified and determined critical improvement themes and relevant policy.

Process for identifying materiality

STEP 1 Identify and arrange the issues

Regarding the focal themes of our environmental initiatives that we have identified as a foundation for our Group, we cross-checked them against various international codes, assessment items of the main SRI indices, and policies of industry organizations and the like. Moreover, we extracted another six themes. In addition, we classified them into three phases as either upstream (procurement) or downstream (products and services) mainly as business activities in relation to the scope of their impact on our business. We identified 18 themes (6 themes × 3 phases) in total based on our life-cycle approach.

STEP 1 Extract the priority issues

Regarding the 18 themes that we identified in Step 1, we employed the perspective of “corporate profitability coexisting with environmental sustainability” to identify priority issues using a two-axis assessment; larger or smaller demands and expectations of society; and the degree of importance to our business. Furthermore, when assessing the demands and expectations of society, we reconciled any gap with our hypothesis through direct dialogue with stakeholders.

Holding of stakeholders’ meeting

Date:
Thursday, January 28, 2016
Venue:
Daiwa House Industry Co., Ltd. Head Office 2nd-floor conference room
Theme:
Important environmental issues our Group should address
Participants:
Two customers (housing and buildings), one business partner, one shareholder and one investor
Opinions:
  • ・The company should make a greater effort to develop and adopt products that help to prevent global warming because doing so will contribute to improved corporate competitiveness.
  • ・Town planning that emphasizes preservation of biodiversity is regarded as having added value now, but it will also lead to improved property values over the long term. In the future, this approach will become commonplace.
  • ・As the illegal felling of tropical forests was criticized at the COP 21 climate change conference, the company should make efforts to reduce raw material procurement risk by taking the initiative with regards to the supply chain in the future.
  • ・Extending the service life of buildings and increasing their durability present business opportunities for Daiwa House Industry, as such initiatives contribute to resource conservation and help to improve property values for customers.
  • ・The discovery of any soil contamination can lead to considerable expenses during the demolition or sale of a used building. The company should properly manage this risk when procuring land.

STEP 2 Confirmation of validity (Experts’ dialogue)

Regarding the important issues we identified in Step 1, we have evaluated the validity through direct talks with experts, including the process for identifying materiality. We welcomed the opinions of these experts, especially the latest findings from a particularly long-term viewpoint and global perspective.

Experts’ dialogue

Date and time:
Monday, February 29, 2016, 13:00–16:00
Venue:
Daiwa House Industry Co., Ltd. Tokyo Head Office 2nd-floor conference room
Theme:
Important environmental issues our Group should address

Experts:Main viewpoints covered

Toshihiko Goto
Chief Executive Officer, Sustainability Forum Japan

  • ・When we consider the materiality of the Medium-Term Action Plan for the Environment, one can say that the specific process and content have been carried out appropriately for the most part. Of course, it will be necessary to conduct regular reviews in the future because the materiality might change with respect to the long-term environmental vision, just as CO2 reduction targets are being reviewed every five years according to the terms of the Paris Agreement signed at COP 21.
  • ・Regarding the water issue overseas, regional characteristics have resulted in social risk. Attention is necessary for points whose risks and issues must be identified, as they will greatly change if the business focus is shifted overseas in the future.
  • ・Regulatory factors are considered risks currently, but they can also be regarded as opportunities when viewed from a long-term perspective. So, recognizing factors from a perspective of increasing the company’s competitiveness reveals that one’s point of view is important for taking advantages of opportunities.

Hidemi Tomita
Senior Project Principal, LRQA Japan

  • ・In terms of the process, I formed the impression that it was carried out effectively. In the future, I suggest the analysis should be undertaken by subdividing every business in order to measure the relevance to the business.
  • ・While it is important to involve external stakeholders, I suggest that you must involve more internal people from within the company in the discussions when identifying issues and considering solutions.
  • ・Regarding extending the service life of houses and maintaining property values, I felt that the issues of “resource conservation” × “products” should be high in importance from the perspective that Japanese housing should be afforded particularly high relevance.
  • ・Formally determining materiality is necessary, but it is also important to apply it to the Medium-term Action Plan for the Environment and to specifically indicate the types of initiatives required. I hope that you will connect with these initiatives and strategically promote them.

Our response

Tatsushi Nishimura
Representative Director and Senior Managing Executive Officer
Executive Officer in charge of the Environment
Daiwa House Industry Co., Ltd.

We received a number of opinions this time, including a process for identifying and for reviewing materiality, but we felt that it was still unsatisfactory in terms of the process. It will be necessary to further improve this area in the future.
In particular, the business of our Group diverges into many branches with differing business models, so it is necessary to analyze the various business supply chains when pursuing important issues. In terms of the various regulations, we came to understand that these regulations are linked to a contribution to society as well as to improved corporate profitability from the seizing of business opportunities; they do not represent only negative risks.
We welcome the opinions of a variety of stakeholders and we will continue to review materiality and steadily implement our new Action Plan for the Environment (EGP2018) in response to these opinions from now on.

STEP 3 Identification of materiality (priority issues)

In keeping with “confirmation of validity” in Step 2, we conducted the final review in the company mainly with the Executive Officer in charge of the Environment and the relevant departments. We identified the most important priority issues (framed in red in the table below) by sorting out the importance in line with the results of an assessment according to the “materiality map” from the prospective of both our company and our stakeholders.

STEP 4 Incorporation into the Action Plan for the Environment
(Endless Green Program 2018)

Regarding the priority issues that were identified in Step 3, we decided to incorporate the relevant policy for each theme in consideration of our action level.
We identified prevention of global warming (products and services) and harmony with the natural environment (products and services) — issues of high priority for both society and our company — as well as our own initiatives that had not been sufficiently addressed as Priority Improvement Themes. We intend to actively implement improvements. Moreover, we have identified Continuous Improvement Themes and Maintenance and Management Themes for other issues equally as follows. Regarding the new phase of procurement that we have adopted this time, we will promote our initiatives as Implementation Themes with respect to the prevention of global warming, conservation of natural resources, and water resource conservation, which we have not yet been able to address.

Products and Case

List of Special Eco Report


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