Addressing Climate Change (TCFD)

The president executes measures based on the decisions and advice of the Board of Directors as the person responsible for business execution.

The Management Committee deliberates on our company’s important managerial affairs and draws up detailed action plans regarding the decisions made at the Board of Directors meetings.

The CSR Committee has been established to engage in comprehensive discussion about the direction and content of CSR activities, including climate-related measures, and to have flexibility in developing such activities. In addition, the committee addresses broad sustainability-related challenges, such as ESG and the SDGs, centered on our three priority themes for CSR (the environment, diversity and inclusion, and community contribution). The committee is chaired by an executive officer in charge of general affairs, is comprised of CSR-related department heads and other managers, and has a secretariat based in the General Affairs Division. Furthermore, to increase the effectiveness of our initiatives for each of our priority themes, we have established three working teams to address major areas. The Environment Team handles climate change response and environmental preservation, while the Diversity and Inclusion Team handles human capital and human rights, and the Community Contribution Team handles educational support and similar matters.

The main activities of the CSR Committee are to develop CSR-related basic policies; establish priority themes; draft, discuss and promote measures to address priority themes; to design and discuss information disclosure policies and disclosure content; and to provide recommendations and reports to the Management Committee and Board of Directors as appropriate.

With regard to climate-related matters, based on the TCFD framework, the Environment Team of the CSR Committee conducts hearings with staff departments and business departments to identify and review climate-related risks and opportunities, and evaluates and reviews business impact based on scenario analysis. The division responsible for risks and opportunities promotes the carbon neutrality action plan, the key to the Group’s strategic resilience, while the Environment Team regularly verifies progress and makes reports to the CSR Committee. The CSR Committee drafts, discusses, and promotes the contents of the support provided to each division related to the reported items in question from the standpoint of sustainability promotion, in addition to drafting and discussing the policy for information disclosure and the contents of disclosure and providing recommendations and reports to the Management Committee and the Board of Directors as necessary.

Executive officers and relevant staff departments and business departments work via the carbon neutrality action plan and other efforts to mitigate climate-related risks and capitalize on climate-related opportunities.

The climate-related risks and opportunities, as well as countermeasures, identified and evaluated by the CSR Committee are integrated in the periodic risk auditing conducted by the NEG Group in line with our basic policy on internal control. The division responsible for risks and opportunities promotes countermeasures.

We have carried out the following scenario analysis in order to evaluate the business impacts under different scenarios, as well as to evaluate our strategic resilience with regard to climate-related risks and opportunities.

All NEG Group businesses are targeted for analysis.

The impact on the NEG Group’s business by major climate-related risks and opportunities identified from scenario analysis was evaluated on a timeline focused on the year 2030.

Following updates to the reference scenarios, we reviewed impacts on business. They changed due to soaring raw material and energy costs caused by global inflation and other factors, and fluctuations in exchange rates. We will enhance our business resilience by incorporating new technologies and solutions from inside and outside the company and implementing the above actions, such as the carbon neutrality action plan.

Against a backdrop of the current, pressing and global need for climate change action, we continue to pursue sustainable manufacturing practices, as well as strive to precisely address climate change through the establishment, in February 2022, of CO₂ emissions reduction targets for 2030 (Scope 1 + Scope 2) accompanied by a commitment to carbon neutrality by 2050. To achieve this, we are undertaking ambitious measures, including introducing all-electric melting furnaces across our product lines, switching over to energy-efficient facilities, and investing in renewable energy. For Scope 3, we have set up a system to calculate CO₂ emissions and have started disclosing this information.

Due mainly to structural reform in the displays business and composites business in FY2023, CO₂ emissions (Scope 1 + 2) in FY2024 declined from the previous fiscal year. Meanwhile, CO₂ emissions intensity (Scope 1 + 2) were stable on an unit basis from the previous fiscal year.

In order to achieve CO₂ emissions reduction targets, the NEG Group has created a carbon neutrality action plan, which involves a variety of initiatives, focusing primarily on those in the table at right. Through these, we will achieve our targets by 2030, after which we will pursue improvement activities that will make us carbon neutral by 2050.

We succeeded in melting glass with combustion technology using a hydrogen-oxygen burner. (April 19, 2022)

We started operation of a mega solar power system at the Shiga-Takatsuki Plant. (March 30, 2023)
We signed our first VPPA (virtual power purchase agreement) for solar power. (December 11, 2023)
We signed VPPA for solar power in Malaysia. (July 25, 2024)
Solar power generation systems are being installed by NEG group companies inside and outside Japan.

In the glass manufacturing industry, where significant energy is required for melting processes, reducing greenhouse gas emissions from melting furnaces is a top priority.

An oxy-fuel firing furnace differs from an air combustion furnace in that nitrogen is not taken into the furnace, which means that less exhaust gas (and consequently exhaust heat) is produced, thus reducing fuel consumption and CO₂ emissions. Furthermore, the generation of thermal nitrogen oxides (NOx) in a furnace is reduced. In fiscal 1993, we installed Japan’s first oxy-fuel firing glass melting furnace. This technology has now been adopted for almost all of our furnaces.

For more than 20 years, we have been shifting to fuels that produce lower carbon emissions, actively switching to the use of natural gas. In fiscal 2010 we completely stopped using heavy oil, and in fiscal 2023 we achieved a natural gas usage rate of 99.6%.

We are currently developing combustion technologies that do not emit CO₂. In fiscal 2022, we developed a hydrogen–oxygen combustion burner, which runs entirely on hydrogen fuel, and used it successfully in glass melting demonstration experiments. The combination of hydrogen fuel and oxygen combustion technology makes possible highly efficient glass melting.

Fuel Conversion

In the current melting process, both gas and electricity are used. When using electricity, we insert electrodes into the molten glass, a method of heating that uses the direct passage of electric current. This method is highly energy efficient, and produces less exhaust heat than gas combustion. Carbon emissions can also be reduced going forward by introducing renewable energy sources. To achieve this, we are promoting a shift to hybrid melting furnaces that can be powered by electricity. A further shift to all-electric melting furnaces is the direction in which we are headed.

Gas-fired furnace and All-electric melting furnace

Updates on improvements in energy efficiency can be found on the Environmental Business Plan page.