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. Appropriate management of forests prevents global warming, conserve biodiversity, and provide essential resources for people's lives. However, if forests are not managed appropriately, such as by excessive logging and neglecting efforts in reforestation, sustainability of forests will be threatened, and global environment and people's lives will be adversely affected.

Sumitomo Forestry Group has developed various businesses centered on wood, such as forestry business, timber and building material distribution and manufacturing business, housing business, global construction and real estate 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 (FY2023)

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 2023, actual number of planted trees was 2.09 million, which was less than plan number of 2.23 million. Planting of seedings being postponed due to delayed melting of snow in spring was main reason. However, from fiscal 2022, we were able to increase supply of seedlings by proposing seedlings such as low-pollen cedars that accurately grasp customer needs in new areas and by increasing supply of seedlings to subsidiaries engaged in forestation.

With regard to the amount of biofuel material used (such as wood chips and pellets), the exact figure was 1.738 million tons, 336,000 tons less than the planned 2.074 million tons.

The chip manufacturing subsidiaries manufacture and sell fuel chips required for biomass power generation. In fiscal 2023, the amount of used decreased due to the adjustment of demand following the emergency shutdown of some biomass power generation plants. Continuously in 2024, promotion of utilization of domestic timbers, provision of seedlings, and reforestation through utilization of unused forest resource for biomass use are positively advanced, thereby contributing to sustainable forest management.

*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.

*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.

*3Sustainable Green Ecosystem Council (SGEC)

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 2023, our company sold 629,000 native species logs, exceeding our plan of 480,000. In addition to an increase in new customers through e-commerce, an increase in orders for greening business for office buildings and parks, mainly in central Tokyo, led to an increase in sales of native species logs by accurately understanding customer needs. In fiscal 2024, we will seek to increase sales of native species logs by providing consulting services that enhance corporate value, taking into account effective use of corporate green space, balance with surrounding environment and landscape, and conservation of local ecosystem as a whole.