Material Issue 1

Related SDGs

Basic Policy

As global environmental problems such as climate change, resource depletion, and biodiversity loss become more serious, expectations for wood and forests that produce natural resources and biological resources to solve these problems are rising. Forests not only have functions of absorbing and fixing CO₂, conserving biodiversity, and producing wood building materials, fuel materials, or the like, but also have various public benefits such as water source recharge, soil conservation, and sediment disaster prevention.

Sumitomo Forestry Group has developed various businesses centered on wood, such as forestry business, timber and building material distribution and manufacturing business, housing and building business, and renewable energy business. "The Sumitomo Forestry Group utilizes wood as a healthy and environmentally friendly natural resource to provide a diverse range of lifestyle-related services that contribute to the realization of a sustainable and prosperous society. All our efforts are based on Sumitomo’s Business Spirit, which places prime importance on fairness and integrity for the good of society." In order to realize our Corporate Philosophy, we intend to enhance value of forest resources by promoting further integration of business and ESG and by conducting sustainable forest management and use of wood.

Impact on Society and the Environment

Management of Material Issue 1 (FY2022)

In Mid-Term Sustainability Targets 2024, Material Issue 1 is divided into 9 evaluation indicators, and management is carried out by incorporating them into annual activity policies and measures of the management department. We also assess the impacts that the material issue has on society and the environment.

Utilization of Sustainable Forest Resources

The Sumitomo Forestry Group produces seedlings needed for reforestation after harvesting (clearcutting) in Japan. In fiscal 2022, the number of seedlings shipped was 1.88 million compared to the planned 2.23 million, falling short of the plan due to the fact that fall demand did not meet our anticipation, but the number exceeded the fiscal 2021 level (1.46 million), a record high, due to a recovery in reforestation demand. In fiscal 2023, we will contribute with our effort to sustainable forest management by increasing the number of seedlings, focusing on spring shipments, which are in high demand.

Indicators for Evaluation	Managing department	FY2022 target	FY2022 result	FY2022 value	FY2023 target	FY2024 target
Domestic and overseas certified forest area (ha)	Environment and Resources Division	242,493	231,153	△	242,493	242,493
Area of forest plantation with in-house produced seedlings Domestic forest (ha)		892	753	△	892	1,012
Seedlings supplied Domestic forest (unit: 10 Thousand)		223	188	△	223	253
Amount of biofuel material used (such as wood chips and pellets)*1 (t)	Environment and Resources Division Timber and Building Materials Division	1,832,890	1,648,729	△	2,073,948	2,482,964
Percentage of sustainable wood used as primary building material*2 (%)	Housing Division	100	100	○	100	100
Maintaining of SGEC certified area*3(%)	Environment and Resources Division	100	100	○	100	100

*1FIT fuel material and non-FIT fuel material handled by Japan Bio Energy, Okhotsk Bio Energy, Sumitomo Forestry Wood Products, and Sumitomo Forestry's Timber and Building Materials Division are eligible. For Sumitomo Forestry Wood Products, the KPI has been changed to include only FIT fuel material, and from fiscal 2022, the KPI excludes non-FIT fuel material and adds log-derived FIT fuel material to the total. The impact of this change is a decrease of about 200 thousand tons.

*2"Sustainable wood" is defined as certified wood and pre-certified timber , wood from planted forest, natural forest wood where forestry management and distribution can be assessed as sustainable (excluding wood from conversion forests ), and recycled timber.

*3Except for land leased to Kawanokita Development and surrounding forests

Biodiversity Conservation

We sell native species logs mainly to our detached housing business, to the greening business in urban spaces such as parks, office buildings, and factories, and to general customers such as garden landscapers and plant wholesalers.
In fiscal 2022, we were able to sell 521,000 trees, more than planned, the volume increasing due to construction delays from fiscal 2021, caused by the impact of the pandemic of coronavirus disease (COVID-19). We will continue to increase the sale of native species logs that are appropriate for the region, thereby strengthening efforts to conserve the ecosystem and promoting regional development that makes the most of the natural environment.