Information disclosure based on the TCFD

The NICHICON Group supports the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and will contribute to the realization of a sustainable society by identifying future events related to climate change as management risks and responding to them, while at the same time identifying new opportunities and applying them to corporate strategies.

Based on the TCFD recommendations, the Group will also analyze the risks and opportunities that climate change poses to its business, working to disclose information on governance, strategy, risk management, metrics and targets.


In December 1997, NICHICON Group established the NICHICON Group’s CSR Charter (revised in August 2015), and as the Mission Statement declares, we have not only contributed to the creation of a brighter future for society through the manufacture of products that have value, but also worked to realize a better global environment. In our medium-term growth targets, we have set tackling climate change as one of our most important priorities based on our sustainability policy. The Board of Directors has decided on policies and measures to build and promote ESG management and to acquire business opportunities aimed at realizing a low-carbon society.

As a framework for promoting these activities, we have also established the Sustainability Promotion Committee, chaired by the president. Within this committee we have set up the Environment and Energy Committee attended by the persons responsible for relevant divisions to create a system that works across the company.


The Group examined the risks and opportunities that climate change poses to our mainstay capacitor and NECST businesses. After outlining the environment surrounding our business to consider the importance to stakeholders and the Group, the risks and opportunities are evaluated on three levels: small, medium, and large, in terms of their impact on our business activities.

Category Event Risk/
Effect Impact
Carbon pricing Risks A carbon tax (carbon pricing) will lead to an increase in raw material procurement costs for aluminum electrolytic capacitors such as aluminum foil, electricity costs, and chemicals. Large
Opportunities To limit carbon emissions, there will be greater capital investment in the use of renewable energy. To make effective use of renewable energy whose supply is unstable, more power storage equipment will be installed, and demand for aluminum electrolytic capacitors and film capacitors used in such equipment will also increase. Large
Opportunities As the shift from internal combustion engine vehicles to electric vehicles progresses, there will be more business opportunities for film capacitors, rapid chargers, vehicle-to-home (V2H), and aluminum electrolytic capacitors. Large
Renewable energy subsidies Opportunities The use of renewable energy will be promoted through policies such as subsidies. To make effective use of an unstable supply of renewable energy, the introduction of power storage equipment will be encouraged. Large
Energy saving policies Risks Costs for new capital investment, etc. will increase. Medium
Opportunities Demand for aluminum electrolytic capacitors will increase as the use of inverters in industrial equipment and white goods accelerates. Large
Opportunities The tightening of energy-saving regulations for office equipment, etc. will raise the technological bar for switching power supplies, bringing with it greater business opportunities. Medium
Market Energy mix changes Risks Renewable energy will take the place of oil and coal, causing electricity bills to skyrocket.Manufacturing costs will increase, especially for aluminum electrolytic capacitors. Large
Price increases /
decreases in key products
and commodities
Risks There is a possibility of rising resource prices due to increased demand for electric vehicles and power storage systems, and rising prices due to a supply and demand gap for storage batteries themselves. Medium
Opportunities The majority of sales would have been for aluminum electrolytic capacitors, but film capacitor demand for inverters will increase. Medium
Opportunities Should the supply of storage batteries be prioritized for electric vehicles, we will have business opportunities in the V2H market, yet if supply/demand eases off, we will expand our storage battery system business. This will be a business opportunity for the Tribrid and DC Link Industrial Power Storage Systems. Medium
Technology Widespread use of
renewable energy and
energy-saving technologies
Opportunities Advances in renewable energy technology will make it possible to generate energy with minimal equipment, leading to cheaper electricity and lower manufacturing costs. Small
Opportunities Even if energy-saving technology becomes widespread, it is most likely that energy will be used in electrical form, meaning that demand related to power storage systems and electric vehicles will increase. Medium
Reputation Perceived reputation from customers Risks The business continuity planning (BCP) approach has become commonplace, and because it is necessary to prepare multiple factory production systems for all products, capital investment costs will soar and product costs will rise. Moreover, BCPs may require surplus production capacity which will have a detrimental impact on the bottom-line. Small
Opportunities Rather than being evaluated only on the product itself, companies that are more environmentally aware will be preferred by customers. Small
Perceived reputation from investors Opportunities Companies will be rated not only on their current business performance, but also on their ESG-related initiatives. Small
Chronic Rising average temperatures Risks Frequent extreme weather events will lead to more regular plant shutdowns, meaning that companies will need to keep and diversify spare production capacity to maintain supply to customers. Large
Opportunities As companies strengthen their BCPs, there will be a growing trend to build and consolidate new factories, leading to increased demand for aluminum electrolytic capacitors and film capacitors used in factory equipment. Large
Opportunities To make effective use of an unstable supply of renewable energy by using it for air conditioning equipment, the introduction of power storage equipment will be encouraged. Large
Changing rainfall patterns Risks Drop in some production capacity due to water shortage. Small
Rising sea levels Risks Rising sea levels will submerge suppliers’ production bases along the coast. Medium
Acute More extreme weather Risks Some factories will be forced to shut down due to flooding. Small
Opportunities Local energy production and consumption will progress, encouraging more use of power storage equipment. Medium

1.5°C scenario (less than 1.5°C temperature rise by 2100 compared to pre-industrial levels)

Governments around the world will introduce support systems for renewable energy, etc., while electric power companies will work toward net-zero on the road toward carbon neutrality. With more rigorous decarbonization policies, the shift to electric vehicles and use of renewable energy will accelerate. As a result, physical risks will be kept low as temperature rises and abnormal weather are held within certain parameters.
From this, earnings from xEV film capacitors, EV-related equipment, power storage systems, etc. will increase significantly, and the impact of physical risks will be reduced, resulting in a significant increase in final profit.

4°C scenario (3.2 to 5.4°C temperature rise by 2100 compared to pre-industrial levels)

Moves to go carbon-free are not actively promoted, and it is assumed that extreme weather will become more severe, making it increasingly more vital to address the resulting physical risks. In addition, electric power companies will continue to generate electricity using fossil fuels, so the CO2 emission factor will not decrease, and the shift to EVs will remain at a certain level due to weaker carbon-free policies.
Although regulatory and technological impacts are not expected to be as large as in the 1.5°C scenario, final profits will increase due to greater business opportunities for capital investment owing to the impact of extreme weather damage.

Risk management

In addition to deliberating and setting strategies, policies, targets, plans, and measures related to Group-wide environmental conservation and climate change, the Environment and Energy Committee also reviews their implementation at monthly Sustainability Promotion Committee meetings. Moreover, we have designated a person responsible for supervising environmental management at the head office Administration Headquarters and established an environmental management system (EMS) secretariat in addition to designating a person responsible for EMS management at our manufacturing facilities to coordinate together in accordance with the environmental policy and environmental conservation plan.

Along with climate-related risks, the Sustainability Promotion Committee also identifies and manages other important risks mainly by the Compliance and Risk Management Committee which sits within the Sustainability Promotion Committee.

Based on our business continuity plan (BCP) and business continuity management (BCM), we have established a Group-wide communication system should any risk occur. In the event of a crisis, we put together a task force according to the scale and level of the crisis with a system in place for formulating countermeasures, directing, giving orders, and implementing such measures.

Metrics and targets

To contribute to global efforts to mitigate global warming, the NICHICON Group aims to reduce greenhouse gas emissions (Scope1, 2, and 3*) associated with its business activities by 46% by FY2030 (compared to FY2021 levels), and to be carbon neutral by 2050.

We are also actively working to manage industrial waste emissions as well as improve the amount of recycling and rate for which resources get reused to preserve the environment and maintain resources.

Scope 1: Direct emissions from the use of fuels
Scope 2: Indirect emissions associated with the use of externally purchased electricity
Scope 3: Indirect emissions other than Scope 1 and 2