Adapting to the climate crisis
How European businesses in Japan are taking action
December 2019 Feature / Text by Gavin Blair
December 2019 Feature / Text by Gavin Blair
European companies are making changes to their operations, partly in response to the shift in public opinion that has built significant momentum this year. Japan, meanwhile, despite talk of sustainability
and the word “eco” being bandied about, continues to lag behind.
“Japan lacks the same strong grassroots environmental movement, and — different from Europe, for example — there is no political party that has truly embraced environmental issues,” says Mattiaz Fredriksson, sustainability business partner at IKEA Japan. “As a result, neither government nor companies are being asked the really tough environmental questions facing political and business leaders in other parts of the world.”
Globally, IKEA has pledged that by 2030 it will become climate positive, “reducing more greenhouse gas emissions than the IKEA value chain emits,” notes Fredriksson.
IKEA is taking a multi-
pronged approach: shifting to recycled materials, including making kitchen cabinet façades out of used plastic bottles collected in Japan; committing to 100% of home delivery by electric vehicles (EVs) by 2025; and serving more plant-based foods at its stores. It is also aiming for 100% renewable energy at its outlets — which it has achieved in Japan by installing 30,000 solar panels on shop roofs — and it has also installed EV charging stations at every location.
“To make IKEA more accessible and reduce customer transportation emissions we are opening a city shop in Harajuku, reaching many people in a place where they are already shopping,” adds Fredrikson.
Transport is a major contributor to carbon emissions. Swedish truck-maker Scania, part of the Volkswagen Group, is “targeting a 50% cut in CO2 emissions from 2015 levels per transported tonne and across our operations worldwide by 2025,” says Mikael Lindner, managing director of Scania Japan.
As EV battery capacity remains insufficient for the type of large trucks Scania specialises in, the firm is looking at other ways to cut emissions, including energy efficiency, route planning, driver training and more sustainable transport systems.
“EVs are part of the future, but it will take some years. We are already implementing solutions that can reduce carbon emissions now, including bio-fuels and other alternative fuels. It’s not just a matter of waiting for the silver bullet of EVs,” adds Lindner, who notes that he sees less focus on climate change among local customers and partners than in Europe.
Air travel is another transport sector that has received a great deal of climate-related attention recently.
“An airline is going to use fuel, so the best way we can improve our overall performance environmentally is to carry the same number of passengers with less fuel and a smaller carbon footprint. That means ordering more efficient aircraft, which is an investment over many, many years,” says Donald Bunkenburg, Japan country head for the Lufthansa Group, who points to the new Airbus A350 as an example of this.
There are still no signs in Japan of the anti-flying campaigns that have caused short-haul demand to fall in Scandinavia and other pockets in Europe, Bunkenburg notes.
One environmental trade-off that airlines have to grapple with, according to Bunkenburg, is the use on planes of disposable versus non-disposable items — such as cutlery, plates and cups. Disposable products tend to be lighter, which improves fuel efficiency, but are usually plastic, made from petroleum or other carbon-heavy resources, and which then cause environmental waste problems.
At the centre of the climate change issue is the burning of fossil fuels. French energy firm Total, once predominately known as a petrol company, has diversified its portfolio and is now involved across the oil and gas chain, as well as in renewables, biofuels and even EVs in Europe.
“Total invests $1.5 to $2 billion annually in low-carbon electricity: more than 10% of its total capital expenditure,” says Daniel Lauré, country chair for Total and president of Total International Japan.
He explains that as a major liquified natural gas (LNG) provider, Total “supplies Japan with LNG, the cleanest fossil fuel, which emits half the greenhouse gases of coal in power generation and which complements renewable energies.”
The seemingly inevitable shift away from fossil fuels is an “opportunity” for the company, says Lauré, which rejects the Big Oil label in favour of Big Energy. It is aiming at worldwide capacity of 25GW of renewable energy by 2025.
With SunPower, a California-based solar specialist — in which Total owns a majority stake — the company is involved in three solar projects in Japan: in Ishikawa, Iwate and Miyagi prefectures.
Lauré says Total is “developing other businesses that will help achieve carbon neutrality through providing energy efficiency services to our customers and by investing in natural carbon sinks, such as forests and wetlands, and in carbon capture, utilisation and storage.”
Investors are also putting pressure on companies to change their ways. French asset management firm Amundi is responding with responsible investment products, including low-carbon index management, green bond portfolios and climate-related
thematic portfolios, says Nicolas Sauvage, representative director at Amundi Japan.
The Task Force on Climate-Related Financial Disclosures (TCFD) was established in 2015 by the Financial Stability Board global industry association to develop a framework for reliable and consistent financial disclosures by listed companies on climate-related issues.
In Japan, “Amundi is the only foreign affiliated financial industry member of the TCFD Consortium planning committee launched by METI in June this year,” explains Sauvage.
The disclosures are voluntary, as are most of the measures being taken by companies across the industries that are contributing to climate change. With the future of human life as we know it likely at stake, a great deal of faith is being put in good will. •