Information Disclosure based on the TCFD and TNFD
The TIS INTEC Group discloses information based on the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and the Task Force on Nature-related Financial Disclosures (TNFD) in order to appropriately understand and disclose risks and opportunities related to climate change and natural capital.
TCFD requires information disclosure in four core elements: governance, strategy, risk management, and metrics and targets.
Governance
At the TIS INTEC Group, risks related to climate change are identified, managed, and addressed in accordance with the company-wide risk management process as one of the factors that may impede the continuous and stable development of business activities. Risks related to climate change are assessed by the Environmental Promotion Officer, who serves as the risk owner. The results of these assessments are utilized by the Corporate Sustainability Committee, composed of directors, to identify strategic risks, and form the basis for the development of management plans that include the pursuit of business opportunities. Individual environmental measures are planned and promoted by the Environmental Promotion Officer under the guidance and supervision of management meetings and the Board of Directors, as appropriate. The progress of these measures is evaluated for effectiveness by a director responsible for risk management at the Group Internal Control Committee.
Strategy
The Group identifies risks and opportunities associated with climate change and natural capital and analyzes their potential financial impacts.
Risk management
To enable more efficient risk analysis and consideration in our risk-management processes, in principle, we will unify our approach to environmental challenges by placing climate change responses and measures concerning natural capital and biodiversity on the same cycle.
In our data center business, which has correlations with climate change issues and natural capital/biodiversity, the responsible organization conducts a business-scale simulation for the fiscal year ending March 31, 2031, when calculating the financial impact of the business. Based on this information, the TISI Energy Conservation Promotion Conference then discusses the potential financial impact for each risk item.
By regularly reviewing risk items and their quantitative financial impacts, we ensure proper and ongoing risk management.
For the identified risks with impact levels classified as "severe," "high," or "medium," we set indicators and targets and work to mitigate those risks.
Metrics and Targets
The Group has established the following environmental metrics and targets.
(1) TCFD metrics and targets (climate-related)
We classified climate-related risks into three categories - "Risks that can be lowered through GHG reduction," "Risks related to methods of GHG reduction," and "Risks arising from the physical impacts of climate change" - and organized the corresponding metrics and targets for each category.
In our review, we referenced "Theme-Based Sustainability Disclosure Standard (Climate-Related Disclosures)" issued by the SSBJ*1, as well as the SASB Standards*2, specifically, "Industry-Based Guidance (Software and IT Services (TC-SI))*3" and also considered their applicability.
When evaluating climate-related risks, the Group uses GHG reduction rate and the renewable-energy utilization rate as key metrics.
*1 SSBJ (Sustainability Standards Board of Japan): A body responsible for setting Japan's sustainability disclosure standards, aligning with requirements of the International Sustainability Standards Board (ISSB) while tailoring disclosure items to Japan's regulatory and market context. Implementation will be phased in from 2027.
*2 SASB (Sustainability Accounting Standards Board) Standard: An international standard that identifies ESG issues with significant financial impact by industry and discloses corporate sustainability information for investors.
*3 Industry-Based Guidance (Software and IT Services (TC-SI)): This guidance is intended for the software and IT services sector, defining key topics such as data security, energy consumption, and service reliability, and providing a structured framework for performance measurement and disclosure.
*4 R1-R4 correspond to the item numbers of the risks/opportunities identified in the TCFD analysis under "Strategy."
For the two key indicators mentioned above - GHG emissions reduction rate and renewable energy utilization rate - we have established the following targets.
| ◇Short-Term Target | 70% reduction in GHG emissions (Scope 1 + 2) compared with fiscal year ended March 2020 Scope: Consolidated Group |
| ◇Medium-term target | Achieve 100% renewable energy utilization (for offices and data centers) by fiscal year ending March 2031 Scope: Domestic Group companies |
| ◇Long-term target | Realize Net Zero Declaration Scope: Consolidated Group |
(2) TNFD metrics and targets (natural capital and biodiversity-related)
Based on the "nature-related risks and financial impacts" identified through TNFD analysis, the Group sets metrics and targets for nature-related risks evaluated as "severe," "high," or "medium" in impact and manages them on an ongoing basis.
At present, we have not identified any risks as "severe" or "high" and therefore have not set metrics or targets. However, we will review and consider risks as necessary in response to future changes in the natural environment and business conditions.
For risks assessed as having a "medium" level of impact, we will continue with the measures indicated under "nature-related risks and financial impacts" while monitoring changes in risk levels.
Additionally, risks assessed as having "small" or "minimal" impact are not currently treated as priority items for management. Nevertheless, we will monitor such risks and consider responses as necessary.