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〔The Environment〕For the Global EnvironmentEnvironmental Accounting

As part of its efforts to fulfill its social responsibility, the KOSÉ Group developed in 1997 the Basic Environmental Policy and the Environment Action Guidelines, under which specific actions have been implemented.
To measure the effects of these actions, the KOSÉ Group performed environmental accounting for this fiscal year as in previous years according to the Environmental Accounting Guidelines 2007.

No retrospective correction of the past figures was made, unless otherwise stated.

Environmental conservation costs

We have invested in Kumagaya factory to build a new Welfare/Material building as well as to revamp the existing production building with air-cooled cooling equipment. We also focus our efforts on making our factories more environmentally friendly by improving their performance through repair and overhaul of wastewater treatment facilities, drainage ditches, and other facilities. Lighting systems have steadily been replaced with LED lights to contribute to energy saving.

We actively accelerated our investment in incorporating biodegradation materials to develop products that contribute to the environmental conservation, and allocated the investment as the research and development cost.
We are highly aware of the prevention of pollution, and promoting activities such as implementing and maintaining effluent treatment facility and ammonia (NH3) deodorization equipment as well as efforts such as using natural gas as the fuel for boilers.

We will continue our proactive efforts to raise awareness of environmental costs and promote environmental investments.

(Unit:10,000yen)

Category Major efoorts FY2016 FY2015 FY2014
Investments Costs Investments Costs Investments Costs
1. Business area costs
(1)Pollution prevention cost Prevention of air pollution, water pollution, soil pollution, noise and malodor 22,468 12,784 10,515 10,531 9,571 13,165
(2)Global environmental conservation cost Prevention of global warming and ozone layer depletion 1,127 1,277 1,106 1,623 2,683 1,558
(3)Resource recycling costs Water saving, effective use of resources, industrial waste treatment, etc. 6,200 12,079 0 10,272 654 9,988
2. Upstream and downstream costs Green purchasing, cost of recycling containers, packages, etc 0 9,627 0 8,576 0 8,810
3. Costs of management activities Environmental education, committees, ISO-related activities, environmental impact measurement 0 1,376 40 1,244 0 1,027
4. Research and development costs Development of environmentally friendly products 0 19,475 0 19,475 0 15,013
5. Social activity costs Announcement of measures to improve the environment and environmental information 49 979 0 1,003 0 1,290
6. Costs to repair environmental damage 0 0 0 0 0 0
total 29,844 57,597 11,661 52,724 12,908 50,850

The invested amounts are those in the depreciable assets acquired during the data collection period.

The depreciation expense is calculated based on the useful life and using the depreciation method in financial accounting.

For compound costs, the portion related to environmental conservation is calculated by subtraction or proportional division.

Environmental conservation effects

352,31 million yen cost saving was achieved by expanding the scope of products to have their directions printed directly on the package instead of providing a separate package insert. The total paper weight saved was as much as 85 ton which is equivalent to 2,542 trees saved from logging.

As we have promoted the shift to using natural gas, the usage of traditional fuel has dropped significantly.
Also our active, continuous commitment on energy- and resource-saving has resulted in 506.99 million yen cost saving.

Environmental conservation effects Previous year’s result
(base period)
This year’s result
(comparison period)
Effects in FY 2016 Effects in FY 2015 Effects in FY 2014
Environmental conservation effects on resources invested in business activities Reduction in energy consumption (Electricity) 12,342,308KW 14,168,910KW -1,826,602KW -75,692KW 366,470KW
Reduction in energy consumption (Heavy oil) 258,500L 260,000L -1500L 14,850L 36,900L
Reduction in energy consumption (Kerosene) 158,000L 153,178L 4,822L 2,520L -5,650L
Reduction in energy consumption (Natural gas)
 807,693Nm3 1,196,454Nm3 -388,761Nm3 -28,735Nm3 -69,474Nm3
Environmental conservation effects on environmental impact and waste from business activities Reduction in emissions of substances with environmental impact(CO2 9,142.9t 9,711.5t -568.6t -614.6t 264.7t
Reduction in generated waste, etc. 2,740.8t 2,509.6t 231.2t -80.7t -112.2t
Environmental conservation effects Previous year’s result
(base period)
This year’s result
(comparison period)
Effects in FY 2016 Effects in FY 2015 Effects in FY 2014
Economic effects associated with environmental conservation measures (Substantial effects)
Reduction in costs Cost reduction through energy and resource saving 426,760,000 yen 269,280,000 yen 194,410,000 yen
Reduction in waste treatment costs through reuse of resources 132,030,000 yen 64,650,000 yen 41,330,000 yen

Reference data on environmental conservation costs

The classification of environmental conservation costs according to their characteristics is shown below.
With regard to investments, the focus was on the adoption of environmentally friendly facilities with energy saving features.
Costs were mainly allocated for the reduction in the generation of waste and its proper treatment, and the promotion of recycling of resources.

(Unit: 10,000 yen)

Environmental conservation costs (Classification according to the types of environmental conservation efforts)
Category Major efforts Investments Costs
(1)Costs related to global warming prevention measures Replacement with LED lights 84 814
(2)Costs related to measures to protect the ozone layer Updating of air conditioners to the inverter type 793 419
(3)Costs related to the protection of the atmospheric environment Addition of dust collectors 2,428 7,790
(4)Costs related to measures to reduce noise and vibration Installation of soundproof walls 308 200
(5)Costs related to measures to protect water, soil and ground environment
 Maintenance of wastewater treatment facilities 18,840 4,502
(6)Costs related to waste recycling Costs incurred for recycling 6,200 21,555
(7)Costs related to the handling of chemicals Use of biodegradable raw materials 0 19,475
(8)Costs related to natural environment conservation Maintenance of plants and trees on the premises 49 979
(9)Other costs Operation and management costs, etc. 1,142 1,863
Total 29,844 57,597

Reference data on environmental conservation effects

In fiscal 2006, we started aggregating data on environmental conservation effects by individual offices. The per-unit effects both in the previous and current years were calculated based on the production and energy consumption of each office.

The consumption of manufacturing resources fluctuates in response to various factors, such as production volume depending on the market situation, climate, and social circumstances. Therefore, KOSÉ analyzes environmental conservation effects both in terms of total consumption and per-unit consumption.

Change in production volumes at major manufacturing sites

(Unit: 1,000 dozen)

  FY 2016 Year-on-year FY 2015 FY 2014
KOSÉ Sayama Office 5,676 113.4 5,004 5,100
KOSÉ Gunma Office 8,298 97.2 8,540 8,217
ALBION Kumagaya Office 1,898 103.9 1,827 1,724
Total 15,872 103.3 15,371 15,041

Outsourced production by contracted manufacturers is not included.

Change in the actual overall consumption and the basic-unit equivalent of environmental conservation effects

The total consumption of each energy source only includes substantial consumption that is calculated based on sound grounds within the data collection scope.

The bar graph in each table shows the total consumption (the scale on the left side) and the line graph shows the environmental conservation effects per basic unit (the scale on the right side).

Data collection for FY 2016

Data for environmental accounting is collected from both KOSÉ Corporation and its manufacturing subsidiaries in Japan from the perspective of group management.

Data collection period FY 2016 (2016/4 to 2017/3)
Data collection scope All factories of KOSÉ Corporation and its affiliate companies in Japan
(ALBION CO., LTD., INTERCOSME INC., and ADVANCE CO., LTD.)
Data collection standards In reference to the Environmental Accounting Guidelines 2005 and the Environmental Reporting Guidelines 2007

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