Domestic Case Studies

Supporting the Creation and Implementation of a Satoyama Restoration Action Plan in Kobe City, Hyogo Prefecture

Background of Support

Many of the forests located in Kita-ku of the city of Kobe used to be broad-leaved forests and called “satoyama.” Now, in and around the forests, various problems are occurring amid changes in the industrial structure, social situations and people’s lifestyles, and due to the aging of society. These problems include the poor management of the forests and nearby fields, damage caused by fallen trees and wild animals, abandonment of farmland, and loss of biodiversity. In response, through the project, we aimed to build a system for local communities to maintain and manage the local forests in an autonomous and continuous manner for the solution of the problems.

Creation and Implementation of a Satoyama Restoration Action Plan

We created an action plan to comprehensively solve the issues concerning the local forests in cooperation with local communities, with a focus on the Ogo district, which is particularly largely covered by forests among the districts in Kita-ku of the city of Kobe, as a model case.

In 2022, we formulated an action plan composed of 21 items based on the results of the forest survey and the awareness survey conducted on local citizens. Since 2023, we have been implementing the formulated plan by starting with priority items.

In 2025, based on the action plan, we conducted the following activities: awareness raising about the circulation of resources in broad-leaved forests, small planted forests and abandoned bamboo forests; recording of the boundary and footpath data to support local communities in managing local forests; and organization of events in cooperation with local communities.

Satoyama restoration action plan created in the project (Extracts)

Concluding a Comprehensive Partnership Agreement to Transform Forestry into a Growth Industry with Nagato City, Yamaguchi Prefecture

Sumitomo Forestry entered into a comprehensive partnership agreement to transform forestry and timber industry into a growth industry with Nagato City, Yamaguchi Prefecture in September 2019 for the purpose of promoting the development of the forest and timber industry in Nagato City to revitalize the local economy.

Past Initiatives

In April 2017, Nagato City was selected as a “region to transform forestry and timber industry into a growth industry” by the Japan Forestry Agency and has worked toward that goal. The Nagato City launched a committee and a range of subcommittees to this end and repeated assessments with local representatives and experts toward the revitalization of forestry. As a result, Nagato City and other related local organizations took the lead in establishing Refore Nagato in July 2020 as a general incorporated association to handle local forest management.

Effects of the Comprehensive Partnership Agreement

Based on the partnership agreement concluded between Sumitomo Forestry and Nagato City, we will work to increase the local production of logs, secure and train forestry workers, and expand demand for wood. By treating forests located in Nagato City as a single entity, we will efficiently manage the forests to make further improvements and transform forestry into a growth industry.

In 2025, we made examinations on branding to promote the use of locally produced timber in Nagato City and make more forest improvements. We also selected candidates for intermediate stockyards in our effort to set our future operational policies and foster sales diversification for logs. Moreover, we conducted demonstration tests and field surveys on the method to treat local forests as a single entity by using smart technologies.

Outline of the Partnership Agreement

• Promote harvesting and replanting
• Stably produce and use container seedlings
• Develop and standardize container seedling production technology and train business operators
• Establish and manage organizations central to forest management
• Identify the quantity of forest resources and the intention of forest owners
• Adopt and effectively utilize ICT in forestry and wood industries
• Adopt and effectively utilize forestry machinery
• Take advantage of business approaches that increase the motivation of forest owners and forestry businesses
• Support the forestry and wood industries in securing and retaining human resources
• Build a cooperative supply chain with local city sawmills and other forestry businesses
• Drive demand for locally produced wood both inside and outside of the city

Promotion of Forest and Forestry DX in Maniwa City, Okayama Prefecture

Since June 2023, Sumitomo Forestry has been implementing a forestry DX promotion project for Maniwa City, Okayama Prefecture.

Purpose of the Project

Maniwa City is short of forest management personnel and aims to encourage its existing employees and staff of the local forestry association to proactively use digital data for efficient and systematic forest maintenance. In the project, we selected a model area, organized digital data on the area, and systematized a method for the employees and staff to make forest improvement plans.

Details of the Project

In this project, we selected a model area in Maniwa City and obtained highly accurate data about the forest resources in the area by laser measurement. After utilizing these data and taking disaster resilience and economic efficiency of forestry into consideration, we carried out zoning to classify forests into forests for which reforestation is recommended, forests to be converted into mixed conifer and broadleaf forests, and others. Based on the zoning results, priorities for clearcutting and thinning were set from a long-term perspective and incorporated into specific forest maintenance plans. After discussing this series of tasks with staff of the city government and forestry association, we organized the workflow as a method unique to Maniwa City. We hope that the results of this project will accelerate forest improvement in Maniwa City.

Provision of Services for a Forest Value Creation Platform

Sumitomo Forestry and NTT DOCOMO BUSINESS (DOCOMO BUSINESS) launched a comprehensive service platform called “Morikachi” to support the creation, verification, and trading of forest-derived carbon credits (“forest carbon credits”) under the J-Credit Scheme*¹ in August 2024, aiming for the expansion of measures to promote the decarbonization market.

"Morikachi" is Japan's first platform*² to provide Geographic Information System (GIS*³) functionality to forest carbon credit creators, verification bodies, and purchasers alike, aiming to streamline the issuance process and enhance the reliability of credits, thereby promoting the creation and active distribution of forest credits.

1. Background

   The Credit Scheme is a national government-certified system that recognizes credits for the amount of CO₂ emissions reduced through introduction of energy-saving equipment and use of renewable energy, as well as the amount of CO₂ absorbed through appropriate forest management. Forest carbon credits are high public-value credits that contribute not only to climate change mitigation but also to water source recharge, prevention of sediment disasters, and biodiversity preservation. However, forest carbon credits account for only about 10% of the reduction credits derived from renewable energy and energy-saving measures. Furthermore, of the forest carbon credits created, the amount actually retired for purposes such as offsetting accounts for only about 5% of reduction credits, indicating that both the volume created and circulated remain low, which is regarded as a challenge*⁴ to meet.
   The following challenges lie in the background.

   Challenges and Needs
   Producers	The credit creation process is complex and difficult to understand Proper data management and reporting are a significant burden There is a lack of connection with potential buyers, making it difficult to find sales opportunities
   Designated Operational Entity	Handling a vast amount of paperwork is a significant burden It is difficult to understand the spatial relationships of the target forests from documents alone, making the review process challenging as it requires comparing multiple maps and drawings
   Purchasers	Information related to credits is limited, making it difficult to easily find the desired credits There are concerns about the reliability of the purchased credits We want to effectively communicate the contributions to local communities and the environment made through credit purchases

   To address these challenges, we jointly developed a service that comprehensively supports the three parties by combining Sumitomo Forestry's extensive expertise in forest management with DOCOMO BUSINESS’s specialized ICT capabilities.

2. Overview of "Morikachi"

   "Morikachi" consists of the cloud-based "Morikachi" system and the consulting service called "Credit Creation Consulting Service.

   

   (1) "Morikachi" System

   It provides functions to efficiently handle various information related to forest carbon credits, as well as their creation and trading.

   ① Landing Page

   It is a promotional website for "Morikachi" that is accessible to anyone. It provides the concept and service details of "Morikachi" and example cases as well as basic knowledge about forest carbon credits to all those considering credit creation or purchase.

   Click here for related information

   • Morikachi (in Japanese)

   ② Credit Issuance Support Function

   These are various support functions designed for creators and verification bodies using the Credit Creation Consulting Service.

   • For creators: Provides application preparation support functions, including integrated management of various data on maps using GIS, automatic input of data necessary for credit calculation, and creation guides.
   • For verification bodies: Provides a function to review documents online while confirming the spatial relationships of target forests using GIS.

   ③ Credit Trading Service

   Creators can share various information through the sales page, including the region where the forest carbon credits were issued, the implementers, the natural environment, and innovations in forest operations. By providing abundant information on the regions and environmental values desired by purchasers, smooth transactions are facilitated.

   (2) Credit Creation Consulting Service

   Sumitomo Forestry provides consulting services to support forest carbon credit creation.

   ④ Data Management Support Service

   We digitize map data necessary for credit creation and cross-reference various materials related to the target forests.

   ⑤ Credit Application Support Service

   We assist with the preparation of application documents and support the review process by utilizing the credit issuance support functions of the "Morikachi" system.

3. Roles of Each Company

   Sumitomo Forestry: Operation of "Morikachi," provision of consulting services, sales and marketing activities, etc.
   DOCOMO BUSINESS: Development and operation of the "Morikachi" system, sales and marketing activities, etc.

4. Features of "Morikachi"

   ■ A GIS-based service that reduces the burden on creators and verification bodies

   By linking digitized materials to the forests subject to credit issuance and managing them collectively on maps, the burden on creators and verification bodies is reduced.
   By managing the vast amount of digitized paper documents linked with GIS on the cloud, creators can reduce the burden of data management, such as during personnel handovers or project changes. Verification bodies can prevent double counting, manage large-scale projects with extensive data, and significantly improve operational efficiency by reviewing documents online while confirming location information using GIS. Additionally, purchasers can more easily and accurately verify the location by comparing the approximate position of the project's target forest displayed on the GIS of the sales page with the application documents and other materials. This makes it easier to select forest credits and enables purchasers to buy with confidence.

   

   ■ Enhancing information on the sales page for purchasers to promote forest carbon credit transactions

   Forest carbon credit purchasers seek information not only about the location of the forest but also about the status of forest certification, forest maintenance and conservation methods, conservation of specific species of flora and fauna, and quantitative assessments of functions such as landslide prevention and water source recharge, reflecting the environmental contribution. "Morikachi" provides a well-equipped sales page to clearly offer the various types of information sought by such purchasers. The sales pages created by the credit creators can include various information about the project and the creators, such as GIS data, photos, maps, website links, and brochures.
   Through detailed sales pages, buyers can clearly understand the environmental values for which they are paying. This makes it easier to select forest carbon credits and promotes transactions, while also supporting companies' GX initiatives through the promotion of forest maintenance and contributions to regional revitalization.

   

5. Future Developments

   We will enhance the platform's functions, including the forest credit inventory management function and AI-assisted support for creating sales pages. We will collaborate with partners such as local governments and financial institutions to expand the value provided by "Morikachi," and also advance partnerships with consulting firms that support creators and buyers. In the future, we plan to expand the service to include the crediting of various shared benefits provided by forests, in addition to CO₂ absorption.

*1A scheme in which national government certifies amount of CO₂ emissions reduced through introduction of energy-saving equipment and use of renewable energy, as well as amount of CO₂ absorbed through appropriate forest management as credits

*2According to research conducted by Sumitomo Forestry and DOCOMO BUSINESS

*3Geographic Information System. It visualizes geographic information on a computer map (digital map) and uses it to derive information relationships, patterns, and trends in an easy-to-understand manner

*4Based on statistical data from the J-Credit Scheme Secretariat website: "Status of J-Credit Utilization (Invalidation and Retirement Volume)"

Overseas Case Studies

Corporate needs for forest management are being diversified. In recent years, a considerable number of companies have been conducting forest conservation and planting activities in developing countries to mitigate their impact on forests in overseas countries and regions where they engage in business activities, and to fulfill their corporate social responsibilities.

Drawing on its knowledge of forest management in Japan and overseas, Sumitomo Forestry implements its consulting business for the restoration of degraded forests in tropical regions, the rehabilitation of biodiversity, and for the protection and cultivation of forests that takes into account local communities.

Wildlife Conservation Forest Restoration and Regeneration Project

Sumitomo Forestry has been providing consulting services for the restoration of degraded forests in the Paliyan Wildlife Sanctuary (Gunung Kidul Regency, Special Region of Yogyakarta) in Indonesia, a project initiated by Mitsui Sumitomo Insurance Co., Ltd. in 2005.

During the first phase of activities to March 2011, around 300,000 trees were planted on 350 hectares of land. In the second phase of activities launched in April 2011, Sumitomo Forestry provided support for the organization of agricultural associations and for an agricultural guidance program to improve the livelihoods of local people. We have also supported the establishment of an inclusive organization to examine ways of managing protected forests and the provision of an environmental education program implemented in cooperation with local schools. In the third phase of activities started in April 2016, we supported additional planting in areas with few trees in protected forests as well as social forestry by local communities around protected forests. We also cultivated seedlings to be distributed for social forestry. In the fourth phase starting in April 2021, we built upon the activities conducted in the third phase and continued efforts to maintain protected forests and make more achievements with regard to support for agricultural cooperatives and the promotion of social forestry.
We are currently in the fifth phase, during which we will build on past activities while also undertaking new initiatives aimed at enhancing the project's value in alignment with Nature Positive goals. These include: (1) establishing a transition model toward a more biodiverse ecosystem using native species, (2) developing a community-based forest management model, and (3) creating a karst ecosystem restoration model in anticipation of future Nature Positive requirements.

As part of this project, we have also opened the doors to our planted forest, seminar house and other related facilities in a positive effort to make information on our experiences and know-how on forest restoration available to the public. The forest area and facilities are visited by local elementary and junior high school students, and students and experts conducting research on Paliyan Wildlife Sanctuary, forests, the environment and education in and outside Indonesia, as well as by many government officials.

Toward the Commercialization of "Tropical Peatland Consulting" and "High-Quality Carbon Credits Generation"

Sumitomo Forestry and IHI Corporation established NeXT FOREST in February 2023 to provide consulting services for the appropriate management of tropical peatlands and to create high-quality carbon credits*¹ by appropriately evaluating the value of natural capital, such as the amount of carbon accumulated in forests and soils.

Sumitomo Forestry has developed management technologies and ground-based measurement data for forests in Japan and overseas, as well as tropical peatlands in Indonesia. IHI Corporation has developed technologies for the use of satellite data and weather observation and prediction technologies through its long experience in space development. Combining these strengths, Sumitomo Forestry and IHI have launched a consulting business to spread the use of appropriate management technologies for tropical peatlands worldwide. We will also develop a method for precisely evaluating and monitoring the amount of CO₂ absorbed by vast forests. In 2023, we developed the sPOTEKA, real-time weather observation device for tropical peatlands, and an initial AI model for groundwater level management. In 2025, we received an order for sPOTEKA-based data service from a company in Indonesia. By introducing this technology, groundwater level management —which previously could only be carried out by experienced Sumitomo Forestry engineers —can now be performed based on objective data such as weather information. Going forward, by utilizing the sPOTEKA weather monitoring device and AI model to promote appropriate groundwater level management methods, we aim to contribute to reducing CO₂ emissions and preventing forest fires in tropical peatlands such as those in Indonesia.
We also aim to create high-quality carbon credits by adding value as natural capital*², such as biodiversity, water cycle conservation and contribution to local communities, in addition to the value of carbon absorption as a measure against climate change.

*1A tradable Greenhouse Gases Emissions Reduction Certificate. Emissions are considered as credits when distributed between enterprises or globally, and the trade unit is 1t-CO₂

*2For example, trees absorb CO₂ and provide clean water, and nature is regarded as a stock (capital) that provides valuable services