Response to climate change and water risk

Having defined one of the Fourth Medium-term Environmental Management Policy as to manage external risks that have the potential to force us to make changes to business operations, such as climate change and water risks, we strive to maintain an understanding of climate change and water risks and implement measures for addressing these risks.

Climate Change Risks

Evaluations of climate change risks at plants and R&D centers are conducted to identify, analyze, and evaluate the potential climate change risks presented by our business.
To reduce such risks, Daiichi Sankyo Europe GmbH has introduced the My Mobility project. Through this project, employees access the dedicated Mobility Portal website to propose eco-friendly means of transportation, such as utilizing electric vehicles for private or work purposes, using public transportation, or riding bicycles. The project thereby helps promote eco-friendly commuting, which contributes to efforts to combat climate change.
In addition, Daiichi Sankyo is examining the possibility of introducing an internal carbon pricing*1 scheme in light of the possible introduction of a carbon tax. In fiscal 2017, we began evaluating and verifying the potential scheme in relation to certain capital expenditures.

  • *1 Act of companies voluntarily setting carbon prices based on potential carbon taxes or emissions exchange systems

Climate Change risks

Climate Change risks

Water Risks

The Daiichi Sankyo Group considers the ability to utilize a sufficient amount of quality freshwater at all operating sites and throughout the value chain to be extremely important for promoting and continuing our business.
Water risks include physical, regulatory, reputation and other risks, which are an increasing concern throughout the world. At the Daiichi Sankyo Group, we ascertain the status of risks with the potential to impact our business at plants and research facilities.
Specifically, we carry out comprehensive risk evaluations based on the results of analyses of local water risks using the WWF-DEG Water Risk Filter and the survey results on water risks emanating from plants and research facilities.
These evaluations indicate that operating sites with the highest water risks among our Group are two plants in China and one in Brazil. (Table 1) Water withdraw restrictions and other strengthened regulations are considered to be major risk factors. At present, these plants account for less than 5% of Group revenue. We are paying attention to regulatory trends and making an effort to further optimize water usage. Specific measures include using recycled water for sprinklers at the two plants in China and using rainwater for sanitary water and other daily usage at the plant in Brazil.

In Japan, surveys are conducted in an effort to understand impacts on business where physical, regulatory and reputational risks are a factor, such as the deterioration of water quality, water shortages, regulation of wastewater quality/volume and the efficient use of water, with analyses and evaluations conducted on the basis of these results. (Table 2) At plants in Japan, we are implementing measures that include reduced the utilization of industrial water.
Furthermore, our water usage and wastewater drainage are confirmed by a third party.

Third-party review

Status of Operating Sites in Areas with High Water Risks (Table 1)

Location River basin Withdrawals
(1,000 m3)
Discharged
(1,000 m3)
Consumption
(1,000 m3)
Beijing Plant Yongding River 168.5 111.2 57.3
Shanghai Plant Yangtze River 52.8 47.1 5.7
Brazil Plant Paraná River 10.1 9.5 0.6
Total 231.4 167.8 63.6

Water Risk Factors and Main Impacts (Table 2)

Risk Factors Main Impacts
Water shortages Reduction in research and production activities when water supply is stopped or restricted
Water quality deterioration Impact on manufacturing water (increases in water purification costs, etc.)
Floods/storm surges/heavy rain Flooding of facilities due to rising rivers
Mandating water efficiency, recycling, etc. Increased cost of equipment installation, etc., due to mandatory use of reclaimed water
Wastewater quality/volume enhanced regulations Cost increases due to rising sewerage fees and stricter wastewater quality regulations result in higher equipment installation costs
Drought Damage of agricultural products used as raw materials
Changes in water supply season/passage of time Impact on operational stability due to changes
Increased water prices Increased operating costs due to rising water prices
Local communities Respond to land subsidence due to pumping groundwater

Appropriate use of water resources

Water is an important resource that is essential in the production of pharmaceuticals, and we recognize it as one of the ecosystem services that should be used sustainably. In addition to understanding of the risks and challenges associated with water usage and the status of water resources in countries and regions where our offices are located, we take measures including reasonable and efficient usage of water, promotion of water reuse via purification equipment, and reduction in the amounts water used.
The volume of water used by Group companies in Japan in fiscal 2016 totaled 10,986,000 m³, reduction 7.4% compared with fiscal 2015. Moreover, the volume of water used by the entire Group in fiscal 2016 totaled 11,534,000 m³, reduction 7.8% compared with fiscal 2015.
For fiscal 2020, the final year of the 5-year business plan, we have set the target of reducing water usage volumes by 5.0% from the level in fiscal 2015. We will continue to promote appropriate usage of water resources with the aim of achieving this target.
Water use per basic unit of revenue for the entire Group was 12.1 (1,000 m³/billion yen), down 4.8% compared with fiscal 2015.
There are no water resources that are significantly impacted due to water withdrawn by the Group.

Volume of Water Used and Discharged (Group in Japan)

Volume of Water Used and Discharged (Entire Group)