Japan: firms cooperate to curb CO2 emissions

With Japan determined to comply with its commitments under the Kyoto Protocol to cut average annual greenhouse emissions by 6% from the fiscal 1990 level in fiscal 2008-2012, companies have been boost…

With Japan determined to comply with its commitments under the Kyoto Protocol to cut average annual greenhouse emissions by 6% from the fiscal 1990 level in fiscal 2008-2012, companies have been boosting efforts to comply with the international treaty and are even preparing for a post-Kyoto accord framework. Driven by a sense of urgency, companies are working more closely than ever with their competitors and, in some cases, other sectors. In March 2008, Asahi Glass Co. shares were excluded from the FTSE4Good stock index, which was created by FTSE Group of the UK in 2001 by selecting stocks in major global firms based on socially responsible principles of investment. The decision came as a result of a new provision in the component criteria that requires companies to specify reduction targets for greenhouse gases. Major Japanese companies, which have long prided themselves on developing the world“s leading energy-saving technology, are not finding it easy to meet overseas requirements. Ambiguous emission targets in Japan, such as setting goals based on production output, appear to be no longer acceptable elsewhere. Under increasing pressure to introduce more effective measures, companies might be reaching their limits in trying to tackle the challenge on their own. In February 2008, Sony Corp. chairman Howard Stringer declared that the company would expand cooperation with firms in various industries at an international conference on climate change held in Tokyo. Sony has already committed itself publicly to its emissions reductions and has begun actively seeking outside help. Now it shares information about successful cases with Nike Corp. and Nokia Corp., and has made some of its environment-related patents available for free. Meanwhile, rival Matsushita Electric Industrial Co. is getting its raw materials suppliers involved in its cause. The firm renewed business contracts with 9,102 companies, or 97% of its total suppliers, after adding a new provision requiring them to take steps to save energy. It plans to select several companies as trial models and begin discussions with them to set specific reduction targets. Starting in April 2008, Nissan Motor Co. is asking its overseas autoparts makers to report the amount of carbon dioxide generated during production. The steel and chemical industries are also speeding up efforts to better deal with the issue, given the fact that they account for roughly half of all CO2 emissions in the Japanese industrial sector. In January 2008, before the opening of the World Economic Forum in Davos, Switzerland, 17 top executives from global chemical giants, including Dow Chemical Co. of the US and Sumitomo Chemical Co., met to discuss energy conservation and agreed to set industry-wide targets. In May 2008, they will hold a working group meeting in Tokyo and decide on procedures to achieve the common goals. Preliminary data shows that in fiscal 2006, greenhouse emissions in Japan rose by 6.4% from the fiscal 1990 level, raising the level for compliance with the country“s reduction targets.