In recent years, climate change has caused severe storms, droughts, water shortages and impact on ecosystems, and addressing these has become a pressing issue. As the trend of aiming toward carbon neutrality accelerates globally, the Paris Agreement was adopted in 2015, and Japan declared in in 2020 that it would aim to become carbon neutral and realize a carbon-free society by 2050. As the transition to a carbon-free society progresses rapidly, initiatives to reduce emissions in companies are gaining importance.

The transportation sector including private vehicles accounts for approximately 18%^* of CO₂ emissions in Japan, and we recognize that it has a significant impact. The transportation of passengers and freight included in the transportation sector is a function deeply related to many industries and everyday life, and reducing emissions in transportation is vital for the realization of a carbon-free society. The Group operates a comprehensive logistics business and uses many trucks. As a corporate group handling social infrastructure in the form of logistics, we recognize that it is our responsibility to take steps aimed at a carbon-free society, and believe that we should further strengthen measures to prevent global warming, which is an urgent issue faced by the world. We will cooperate with stakeholders to engage in the reduction of emissions throughout the entire supply chain.

The boundary shall be domestic Group companies (additional responses in overseas Group companies will be considered)

The SG Holdings Group's Decarbonization Vision is simply explained in a video.

In the SG Holdings Group, the director in charge is responsible for supervising the Group's policies and responses related to climate change Issues related to climate change. Issues related to climate change re reported and discussed in the CSR Committee with the representative director and directors as members, and reported to the Board of Directors as needed.

About the CSR Committee

Organization chart of other subcommittees under the Board of Directors

Climate change risk is incorporated into the Group's risk management and assessed annually.

The SG Holdings Group is promoting the introduction of vehicles with little environmental impact. Sagawa Express plans to switch approximately 7,200 light vehicles to electric vehicles by 2030 as a target. The company is also introducing natural gas trucks, which have exhaust with fewer air pollutants (nitrous oxides, particulates, etc.), and hybrid trucks boasting good fuel consumption.
Furthermore, Sagawa Express has introduced the TRIKE CARGO towing-style electric power-assisted bicycle.

The Group is working to reduce CO₂ emissions throughout the entire transportation/delivery system. For example, transfer centers and Sagawa Distribution Centers (SRCs) are utilized to promote the improvement of logistics efficiency by limiting the number of trucks used. In October 2020, we commenced operation of the transfer center consolidating multiple transfer sites in the Kanto region into the "X FRONTIER" next-generation large-scale logistics center.

The establishment of transfer centers can reduce the number of trucks used.

SRCs are distribution facilities directly connected to the sales offices of Sagawa Express, and enable the reduction of truck transportation between each process.

The Company has also introduced the TRIKE CARGO towing-style electric power-assisted bicycle in Service Centers. TRIKE CARGO has a maximum load of 150kg^* and enables a large volume of packages to be carried without using an automobile.
Through such initiatives, CO₂ and air pollution emissions have been reduced by an equivalent of approximately 1,500 vehicles across all centers.

If a Service Center has been established

Sagawa Express is promoting a modal shift, which refers to switching from the transportation of freight by truck to the modes of transportation that have a lower environmental impact, such as train and ship. Modal shift not only reduces CO₂ emissions but also contributes to saving energy and labor because a larger volume of freight can be transported at once.

In 2004, Sagawa Express began to transport express delivery packages via "Super Rail Cargo" express railway container cars developed jointly with Japan Freight Railway Company. Trains run regularly to and from Tokyo and Osaka and transport roughly 10% of the total shipping volume between Tokyo and Osaka. The total volume transported in both directions is equivalent to 56 ten-ton trucks.

We are engaged in replacing a part of the long-haul transportation from Kanto to Kyushu, which has mainly relied on trucks, with marine transportation. In fiscal 2018, the "Modal Shift Utilizing Marine Transportation" implemented with the cooperation of MOL Ferry Co., Ltd. and Daito Jitsugyo K.K. was approved as an efficient and environmentally friendly action pursuant to the Act on Advancement of Integration and Streaming of the Distribution Business. This has had the effect of reducing CO₂ emissions by 52% and drivers' driving time by 90% compared to transportation by truck.

Sagawa Express has implemented Idling Stop since 1997. When drivers are away from their vehicles while delivering and collecting to and from customers, and when unloading packages in sales offices, the key is removed from the ignition to stop the engine in an effort to reduce emissions.

SG Realty, which oversees property management of the SG Holdings Group, develops environmentally friendly logistics facilities with the aim of contributing to sustainable urban development and realizing a carbon-free society. These efforts include SG Realty Wako (Wako City, Saitama), an environmentally friendly facility with a zero-energy design utilizing energy saving (use of LED lighting throughout the entire facility), energy generation (solar power generation system) and energy storage (rechargeable batteries). Although electricity derived from fossil fuels was used when there was a shortage in power generation due to factors such as insufficient sunlight in the past, the facility realized "zero CO₂ emissions" by switching all electricity during shortages to electricity derived from renewable energy* from September 2020.

Sagawa Forestry, which owns approximately 700 hectares of Sagawa Forests in Kochi and Tokushima prefectures, conducts a forestry business while cooperating with local forest associations to achieve its greatest mission of "protecting the forest cycle."

Coexistence with Nature

We will consider products and services leading to decarbonization for customers and partner companies with the aim of reducing CO₂ emissions throughout the entire supply chain (Scope 3).

In addition, we are creating video content and SDGs communication books, etc. as means of communication aimed at employees and other stakeholders.

SDGs video

Library

Sagawa Express is engaged in the following initiatives aimed at adapting to climate change.

Sagawa Express has concluded disaster agreements with the national government and local governments. In the event of a disaster, the company provides cooperation such as transportation of emergency supplies to evacuation centers and the handling of goods at supply centers based on the agreements. With regard to responses to disasters caused by the impact of climate change, Sagawa Express is proceeding to conclude disaster agreements with the national government, local governments nationwide and universities because greater coordination with local governments, etc. is essential for quickly conducting disaster relief activities utilizing the disaster response experience accumulated by the company.

Sagawa Express is also participating in a variety of external groups and projects to perform communication. The company participates in the Japan Climate Leaders Partnership (JCLP) as an executive member, providing the Japanese government with recommendations on the issue of climate change through dialogue with government officials, policymakers and industry groups. In addition, the company is also acting as member of the Logistics Environment Measures Committee of the Japan Association for Logistics and Transport and a supporting member of the Japan Climate Initiative.