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Reducing Our Environmental Footprint

The impact of climate change, including extreme weather events, is becoming more apparent every year. It is important that companies make strong sustainability commitments and take actions toward solving environmental issues.
We fully understand and support the “1.5°C goal.”* In 2021, we disclosed our medium-to-long-term targets for the reduction of CO₂ emissions — which account for the majority of greenhouse gas (GHG) emissions — as well as the reduction of water consumption and waste. To achieve these targets, we are taking action across all areas of our business and value chains, and promoting initiatives to reduce our environmental footprint in cooperation with various stakeholders.

  1. *The 1.5°C scenario refers to the long-term temperature goal to limit global warming to 1.5°C above preindustrial levels.

Reducing CO₂ Emissions

Climate change is one of the major challenges of our time. It is deeply connected to various issues, including those surrounding water resources and energy. The Sixth Assessment Report issued by the Intergovernmental Panel on Climate Change (IPCC) confirmed that “it is unequivocal that human influence has warmed the atmosphere, ocean and land.” And at the UN Climate Change Conference of the Parties (COP26) Conference in Glasgow, an international 1.5°C goal was agreed upon. In order to mitigate climate change, the reduction of CO₂ emissions is imperative. Companies must take a resilient approach to both market and environmental changes, while ensuring transparency in terms of progress.


At Shiseido, in accordance with the Task Force on Climate-related Financial Disclosures (TCFD) framework, we disclose the impact of long-term climate-related risks and opportunities in our financial plans and associated strategies. To realize a sustainable world, we announced our commitment to achieving carbon neutrality* by 2026. We have also set a science-based target to reduce CO₂ emissions throughout the entire value chain, and to achieve our goals, we are promoting the improvement of energy efficiency and the use of renewable energy.

  1. *At all our sites. Scope 1 and 2.

Renewable Energy

Switching from fossil-derived energy to renewable energy is one of our important environmental initiatives.

We have been increasing the use of renewable energy at our offices and factories, the latter of which are known for their high power consumption. Four of our factories in Japan — Osaka, Kakegawa, Kuki, and Nasu — are actively using renewable energy from CO₂-free hydroelectric power. The Nasu factory and seven offices in Europe and Brazil have replaced 100% of their electricity with renewable energy.

In addition to the use of renewable energy, we are promoting the installation of solar power systems on the premises and buildings of factories and research centers worldwide. We strive to increase the use of renewable energy and are currently accelerating our transition. We have also joined RE100 — a global initiative bringing together businesses committed to 100% renewable electricity.

Solar panels at the Gien factory (France)

Solar panels at the Gien factory (France)


Improving Energy Efficiency

As part of our efforts to mitigate climate change, it is important to reduce and optimize energy consumption related to CO₂ emissions. Improving energy efficiency, such as the use of electricity in buildings and facilities, is an effective initiative to reduce CO₂ emissions.

At Shiseido factories, we are introducing building design improvements such as heat insulation, selecting more efficient equipment that leads to energy saving, and implementing environmental measures based on the ISO 14001 environmental management system.

At our Kakegawa factory (Japan), in addition to the use of LEDs, we installed Energy Management Systems (EMS) * to visualize and optimize energy consumption. Our Osaka Ibaraki factory and West Japan distribution center (Japan) were designed in consideration of sustainability. By pursuing an energy-saving design and improving the thermal insulation performance of the building, we have been able to reduce CO₂ emissions by approximately 30% compared to regular designs.

  1. *A system that realizes efficient use of energy such as energy saving and load leveling by visualizing the energy usage status using information and communication technology.

CO₂ Reduction During Transportation

We are working to reduce our CO₂ emissions and environmental impact throughout the value chain, including during transportation.
As part of our efforts in Japan, we engage in joint delivery initiatives with other companies to improve efficiency surrounding intra-regional routes and loading. For ocean freight in Japan and the USA, we are working to reduce the number of shipments and containers in operation, while optimizing the use of packaging materials according to the shape and volume of shipped goods.

Engaging Suppliers

We also aim to reduce CO₂ emissions during the procurement of raw materials. As such, we hold a global conference to share information with our suppliers and business partners, communicating our strategic policies and asking for their cooperation in the reduction of CO₂ emissions.
We have also revised the Shiseido Group procurement policy. It includes the “policy for responsible procurement” in addition to the procurement vision and basic policy, which were stated in the previous policy. As part of the revision, we have established a sustainability-focused policy that clearly states our intention to promote initiatives to reduce CO₂ emissions with suppliers.

Assessing Climate Risks and Opportunities

In 2021, the Intergovernmental Panel on Climate Change (IPCC) published its Sixth Assessment Report, which summarizes the latest scientific findings on climate. In response to the findings, the Glasgow Climate Pact — which agrees to limit the global temperature increase to 1.5°C above pre-industrial levels — was adopted at the 2021 UN Climate Change Conference (COP26).
We recognize that climate change is not only an environmental issue, but a broader issue that will affect our business strategies and financial plans over the medium to long term due to factors such as changing regulations, natural disasters, and consumer perceptions.
In 2020, in order to mitigate climate change, we disclosed our target of achieving carbon neutrality (Scope 1*1 and Scope 2*2) by 2026. We also committed to accelerate our plans to analyze climate-related risks and opportunities, and integrate them into our group-wide actions.

  • *1:Scope 1 relates to the CO₂ emissions generated from fuel consumption in our sites.
  • *2:Scope 2 relates to the indirect CO₂ emissions generated from energy consumption by 3rd parties such as grid power.


The Shiseido Sustainability Committee discusses management decisions concerning sustainability issues. The committee is chaired by the Representative Director, President and CEO, and consists of executive officers in charge of Corporate Strategy, R&D, Supply Network, Corporate Communications and Brands, as well as Corporate Auditors. The committee makes decisions on group-wide sustainability strategies and policies, manages the progress of medium- and long-term targets, and implements plans such as the Task Force on Climate-related Financial Disclosures (TCFD) and human rights actions.

For decisions regarding important business matters, issues are also discussed at the Global Strategy Committee and the Board of Directors. In 2021, due to the significance of climate change-related issues, the Board of Directors stressed the importance of reflecting our stakeholders’ expectations (employees, consumers, business partners, shareholders, society, and the Earth) into our sustainable initiatives.

Strategy (Scenario Analysis)

We conducted our scenario analysis for both the transitional and the physical risks/opportunities in terms of the 1.5/2°C and 4°C scenarios, respectively, based on the Representative Concentration Pathways (RCPs) and Shared Socioeconomic Pathways (SSPs) provided by the IPCC.

Regarding transitional risk, the elements associated with the transition to a decarbonized society — such as policy, regulation, technology, market, and consumer perceptions — were considered. Physical risks related to the acute or chronic phenomena caused by the rise in temperature — such as floods and water shortages — were also considered. Based on these considerations, the financial impacts of the 1.5/2°C and 4°C scenarios were then analyzed. The influence of carbon tax was identified as the most significant financial impact, with projections pointing toward approximately USD 1-7.2 million in 2030, depending on the number of countries and regions where carbon tax would be introduced.

As for opportunities, in the 1.5/2°C scenario, high awareness by consumers means there is a market for sustainable brands and products. Similarly, the 4°C scenario identifies sales opportunities for products that can help people to live with high temperatures.

At Shiseido, we aim to leverage these findings — by mitigating risks and making the most of opportunities to provide sustainable products to consumers and promote our beauty innovations.

Risk Management

We assessed and identified the impactful risks holistically from a mid-to-long-term perspective. “Environment and Climate Change” and “Natural and Human-made Disasters” are listed as the categories related to sustainability.

Climate-related risks are analyzed based on scientific and socio-economic evidence and integrated into the enterprise risk management system as one of the elements related to climate change or natural disasters. The identified risks and their countermeasures are periodically reviewed by the Global Risk Management & Compliance Committee. As for the critical matters, they are also reviewed by the Global Strategy Committee and the Board of Directors.

Metrics and Targets

In order to mitigate the climate-related risks, we set the reduction of CO₂ emissions as our target.

We aim to achieve carbon-neutrality (Scope 1 and 2) by 2026, and we monitor the progress every year. In terms of mitigating market risks and creating opportunities in the 1.5/2°C scenario, we support the concept of a circular economy, and aim to reduce CO₂ emissions and eliminate single-use plastics with the target of switching to 100% sustainable packaging by 2025*3.

To manage the risk of water shortage in the 4°C scenario, we selected water consumption at our sites as an indicator and set a target of reducing it by 40%*4 by 2026 (versus 2014).

As for other physical risks, we will examine appropriate metrics from the viewpoint of long-term risk management.

  • *3:For sale of products with plastic packaging.
  • *4:Water consumption volume to sales.

Climate-Related Disclosure

We support the Task Force on Climate-related Financial Disclosures (TCFD) and disclose the results of our climate-related risk analysis based on the TCFD framework.

In preparation for a decarbonized society, we have compiled our climate-related goals, scope and initiatives into a transition plan. We are disclosing climate-related information through our responses to the CDP*5, as well as our website, Integrated Report, and Sustainability Report. Our disclosures on CO₂ emissions (Scope 1, 2 and 3*6) are verified by an independent third party, SGS Japan*7, to ensure transparency. In addition, our target for mitigating climate change is certified by SBTi*8, and we have joined RE100.

  • *5:The CDP is a not-for-profit charity that runs the global disclosure system for managing environmental impacts.
  • *6:Scope 3 relates to the indirect CO₂ emissions generated from value chain activities other than Scope 2.
  • *7:SGS is a global certification company.
  • *8:SBTi is a global initiative that defines and promotes best practice in science-based target setting and independently assesses companies’ targets.

Risks and Opportunities

Risks Opportunities
(seen mainly in the 1.5/2°C scenario)
  • Carbon tax increase ☑

  • Fuel price increase

  • Loss of sales opportunities for products using single-use plastics ☑

  • Improve energy efficiency

  • Develop more ethical products (e.g. clean beauty)

(seen mainly in the 4°C scenario)
  • Natural disasters stop operations (e.g. typhoons, floods) ☑

  • Natural disasters disrupt logistics

  • Develop environment-friendly products

  • Develop climate-adaptive solutions

  • Changes in rainfall conditions impact the cost of procuring raw materials derived from crops ☑

  • Water shortages stop operations ☑

  1. ☑Risk factor analyzed qualitatively and quantitatively.

Click here for more details[ PDF : 0.97MB ]

Reducing Water Consumption

Quality water is not only essential to our industry, but also every aspect of life. While some countries and regions are rich in water, others are affected by water stress*1. It is predicted that approximately 5 billion people will face water shortages in 2050 due to urbanization and climate change.
Water supports every aspect of our products, including the development of water-containing products such as lotions; the growth of plants as raw materials; temperature control and equipment cleaning at factories; consumption; and waste disposal.
In consideration of water as a shared resource, we aim for reduced and sustainable consumption that respects and promotes a healthy water cycle and culture. We aim to reduce group-wide water consumption by 40% by 2026 (versus 2014) *2. To achieve this target and reduce the impact of our business activities on the water cycle, we are actively promoting water saving and recycling activities — especially in areas with high water stress and areas where rainfall is expected to decrease.

  1. *1:A situation where there is not enough water of sufficient quality to meet the demands of people and the environment.
  2. *2:Intensity per sales.

Water Saving Initiatives

We are working to reduce water consumption at all our factories.

As each site has various facilities and equipment tailored to the kind of cosmetics they produce, initiatives are specifically designed for each factory. For example, at our Gien factory in Europe — where there are concerns that rainfall will decrease — we switched from water to alcohol for cleaning fragrance product manufacturing equipment and resin skids. All alcohol used in the process is purified and reused repeatedly. We are also saving water by introducing automatic washing equipment in manufacturing facilities and consolidating the washing locations of equipment parts. In addition, we strive to educate and enlighten our employees on environmental issues, including water saving.

Utilizing Water Resources

In collaboration with local stakeholders, we promote “Water Stewardship”*— the concept of managing water resources as a common property within the same river basin. To make effective use of water, we focus on circular usage, where used water is purified and reused or recycled.

At our Osaka Ibaraki factory (Japan), we introduced a circulation-type system using recycled water as a cooling medium. This could lead to an annual reduction in water of 65,000m³. At our Nasu factory (Japan), we use the high-quality groundwater for manufacturing processes and as a raw material for cosmetics. In consideration of the natural environment, the Nasu factory has also established its own strict standards to control discharged water, thereby minimizing any impact on the local ecosystem.

  1. *Using water in a way that is socially equitable, environmentally sustainable, and economically beneficial.
Inspection of wastewater treatment facilities

Inspection of wastewater treatment facilities

Solar panels at the Gien factory (France)

Groundwater purification system at the Nasu Factory (Japan)

Engaging Stakeholders

In cooperation with our stakeholders, we conduct water footprint*1 assessments to understand the environmental impact of water usage throughout the value chain. We utilize the latest knowledge and findings on hydrology*2 and climatology to gain a better understanding of water as a resource, including availability and future projections in relation to climate change. As results suggest that a large environmental impact occurs during the raw material procurement stage, we ask our suppliers to provide information on their water usage through self-assessment.

At our Shanghai factory in China — a country affected by high water stress — we participate in a local environmental protection association and proactively obtain environmental information (including wastewater treatment and gray water recycling) such as environmental laws and regulations surrounding factory activities. We also report monthly water consumption to the government, which promotes water conservation and is working to improve water utilization rates and strengthen water conservation management.

  1. *1:The water footprint is a measurement that quantitively calculates the environmental impact from human water consumption and pollution directly and indirectly through the whole product lifecycle.
  2. *2:The study of the distribution and movement of water above and below the earth’s surface, as well as the impact of human activity related to water resources.

Reducing Waste

As population growth continues and income levels rise, resource consumption and waste increase.

To make more effective use — and re-use — of limited resources, it is important to shift from a disposable, linear economic model to a circular economy. We are optimizing the use of raw materials and reducing waste throughout the entire value chain while comply with waste management and rules differ by country or region.

Waste Reduction

We are working to reduce, reuse, and recycle the waste generated at all our factories.

We achieved zero emissions* at domestic factories in 2003. We have been working on recycling and reusing waste for many years, promoting thorough waste management with careful sorting of materials before disposal and reuse of shipping boxes at all our factories. As for our target of zero landfill at all our factories worldwide by 2022, we achieved it in 2020— two years ahead of schedule and it is continued. We also plan to achieve zero landfill at our newly established Kurume factory (Japan) in 2022. The recycling rate of waste discharged from all Shiseido sites and treated for a fee reached 99% or more.

We are implementing various initiatives to minimize waste throughout the value chain, such as reducing packaging materials, optimizing containers and packaging, eliminating paper inserts, and designing lightweight cardboard. By carefully planning inventory and improving the accuracy of demand forecasts, and shortening delivery times of production and procurement, we aim to prevent the generation of excess inventory.

  1. *Excluding waste designated as landfill by law.

Employee Training

We held online seminars and remote confirmations for newly appointed managers and employees in charge of industrial waste in Japan. The aim was to share knowledge and ensure understanding and compliance with laws and regulations.

Both the seminars and remote confirmations were used to check the processing of industrial waste disposal, and with the help of our original guidelines and checklists, each participant can now identify how to effectively manage waste.