Environmental Management Structure

To ensure that management is practiced in accordance with the Environmental Policy, whose objective is to contribute to the creation of a sustainable society, the Sumitomo Forestry Group has established an environmental management structure with the President of Sumitomo Forestry assuming overall responsibility.

Under the supervision of the President and Representative Director, the General Manager of the Sustainability Department of the Corporate Division, who is responsible for overall environmental management, checks the effectiveness of environmental activities by regularly checking the progress of the environmental targets set by each department of the Sumitomo Forestry Group, based on the Midterm Sustainability Management Plan, and then reports the results to the Sustainability Committee.

In addition, matters discussed by the Sustainability Committee are reported to the Board of Directors by the Director in charge of promoting sustainability, thereby involving the Board in the monitoring of environmental activities. The Sustainability Committee, which includes Directors who also serve as Executive Officers, has oversight responsibility, and it is tasked with formulating and promoting initiatives to address medium- to long-term ESG issues, including climate change.

Environmental Management Structure

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Management of Mid-Term Sustainability Targets

Roles of Environmental Management Personnel

Group Overall Environmental Representative	President (CEO)
Group Environmental Management Officer	General Manager, Sustainability Department, Corporate Division
Division Environmental Management Officers	General Manager, Administration and Planning Dept.(Timber and Building Materials Div.); General Manager, Administration and Planning Dept. (Housing Div.); General Manager, Management and Administration Dept. (Global Construction and Real Estate Div.); General Manager, Lifestyle Service Dept. (Lifestyle Service Div.)
Department Environmental Managers	General Managers, presidents of group companies, etc.
Environmental activity personnel	Environmental promotion personnel

ISO14001 Certification

Sumitomo Forestry introduced an environmental management system in fiscal 1995 and acquired ISO14001 certification for its housing operations in fiscal 1997 ahead of other players in the housing industry. Subsequently, other divisions of Sumitomo Forestry also promoted the acquisition of certification, and in fiscal 2002, all divisions of Sumitomo Forestry in Japan had acquired this certification.
Furthermore, we are promoting certification acquisition, focusing on businesses with significant environmental impact, including our group companies. Currently, six companies, including Sumitomo Forestry, have obtained certifications in Japan. Meanwhile, seven overseas group companies, primarily manufacturing companies, have obtained certifications.
The scope of consolidated companies to be certified focuses on companies that are engaged in manufacturing business and other businesses that have a large influence on the environment. In fiscal 2024, the certification rate of consolidated organizations was 94.5% (based on sales).

FY2024
ISO14001 Certification
Rate（Based on Sales）

94.5%

Group companies		Date acquired	Date renewed (valid for three years)
Multi-site Certification at Group Companies in Japan	Sumitomo Forestry Co., Ltd. (excl. overseas operations)	August 2002*¹	August 2022*¹
	Sumitomo Forestry Landscaping Co., Ltd.	November 2002*²
	Sumitomo Forestry Home Tech Co., Ltd.	March 2013*²
	Japan Bio Energy Co., Ltd.	August 2014*²
Sumitomo Forestry Crest Co., Ltd.		September 2003*²	October 2024*³
Cohnan Kensetsu Inc.		March 2011	March 2023
Kutai Timber Indonesia (KTI)		August 2001	November 2022
Nelson Pine Industries Ltd. (NPIL)		July 2003	July 2022
PT. Rimba Partikel Indonesia (RPI)		October 2005	October 2023
PT. AST Indonesia (ASTI)	The first factory	January 2007	January 2025
PT. AST Indonesia (ASTI)	The second factory	January 2022	January 2025
Vina Eco Board Co., Ltd. (VECO)		March 2014	March 2023
Pan Asia Packing (PAP)		April 2017	April 2023
Regal Innovations Pty Ltd （Regal）		October 2019	October 2022

*1Certification was acquired by individual departments and divisions from 1997 before integrated ISO14001 certification was acquired for the entire company

*2Acquired by inclusion in Sumitomo Forestry's integrated certification

*3Acquired independently after the scope of Sumitomo Forestry's certification was expanded

Audits by External Certification Bodies

Companies covered by the multi-site integrated ISO14001 certification in Japan undergo routine reviews conducted once a year by the certification body JIC Quality Assurance Ltd. In fiscal 2024, 32 departments at four companies underwent surveillance and transition reviews for the ISO14001: 2015 (JISQ 14001: 2015).

As a result of these reviews, one nonconformity and 37 opportunities for improvement were identified. On August 22, 2024, the companies under review were approved to sustain their registration after the assessment.

For the one nonconformity, we investigated the root causes, implemented measures to prevent recurrence, and horizontally shared the information, including in other branches. For each of the opportunities for improvement, we examined improvement methods and took individual action. Issues common to all Group companies were shared by the Sustainability Department, and the status of improvement was confirmed through internal environmental audits. The audit was conducted with particular attention to the effectiveness of compliance with environmental laws and regulations, compliance mechanisms, and responding (measures) to deal with matters where targets were not achieved.

Internal Environmental Audits

In addition to reviews conducted by external certification bodies, companies covered by the multi-site ISO14001 certification periodically carry out internal environmental audits. These audits are implemented by employees who have passed an exam upon completion of an in-house training course taught by third- party instructors to become internal environmental auditors.

Following the amendments of the international standards in September 2015, requiring these courses be taken and passed by all general managers within the scope of the registration in particular enhances understanding about the revisions to these standards and strengthens leadership. As a result, the number of employees certified as internal environmental auditors has reached a cumulative total of 1,844 (as of the end of fiscal 2024).

Internal Environmental Audits were conducted in 73 departments, focusing on departments that were often highlighted in Internal Environmental Audits in fiscal 2023. With respect to observed nonconformities and improvement proposals, the audited department shall take corrective actions and submit a corrective report based on the reviews to the audit department and the Sustainability Department compiled the audit results and reviewed them with the management rank.

Each of our overseas manufacturing companies has acquired the certification and conducts internal environmental audits.

Compliance and Violations of Environmental Laws

The Sumitomo Forestry Group is striving to reduce and to prevent the manifestation of legal risks such as the disposal of industrial waste, soil and water pollution caused by toxic substances, noise and vibration. In fiscal 2024, the first survey on the status of compliance with environmental laws and regulations was conducted for domestic group companies to reconfirm whether there are any inappropriate cases under environmental laws and regulations. For companies that were not fully compliant with the law, we ensured full compliance by requiring appropriate corrective actions.

With respect to the one suspected case of a serious violation of environmental regulations* by the Sumitomo Forestry Group, after detailed investigation, it does not meet our definition of a serious violation. There have been no serious violations in the past five years.

*Violation with a penalty or punishment of one million yen or more. Updated June 2025

Noise and Vibrations

The Sumitomo Forestry Group makes an effort to prevent noise and vibrations during housing construction. When complaints about noise or vibrations are received, the circumstances are recorded and the information is shared with the rest of Group to prevent the occurrence of similar incidents.

Sumitomo Forestry Crest confirms that noise levels within the site boundaries of plants are below the statutory limit by taking regular measurements.

No complaints about noise or vibrations having a major impact on the environment were received from local residents during fiscal 2024.