Mitsubishi Shoji Chemical Corporation is a chemical products company, focusing on domestic sales and trading of solvents, resins, pigments, and silicones. Established in 1987 as a spin-off from Mitsubishi Corporation (MC), the company manages a diverse range of chemical products, from basic chemicals to derivatives. Some of these require strict legal control, while others are hazardous materials difficult to transport through ordinary logistics channels. Therefore, Mitsubishi Shoji Chemical Corporation has been growing its business by utilizing its extensive domestic and international network covering overseas and domestic shipping, oil terminals, land transportation, and customs. Furthermore, it leverages its expertise in chemical logistics and MC’s global network.
The company first underwent the EcoVadis assessment in 2017. Over the subsequent five years, it significantly enhanced its sustainability performance, improving their score by more than 20 points and earning the Bronze Medal in 2022. We spoke with Jiro Tagami, General Manager of the Trade Compliance and Sustainability Group, about their company-wide sustainability efforts.
What is your company's approach to sustainability?
We began our sustainability efforts in 2007, when one of our customers asked us to obtain ISO 14001 certification, an international standard for environmental management systems. Following the guideline that all employees, not just a select few, should participate, we initiated a company-wide effort to minimize our environmental footprint, with active leadership from division heads.
Given the comprehensive nature of this approach, internal assessments and reviews can be particularly challenging. Typically, only a few employees would be involved, but in our case, each department head is in charge of presenting their initiatives and outcomes, fostering a unified effort across the organization.
In 2020, in alignment with the United Nations Sustainable Development Goals (SDGs), we began an extensive study of our progress related to Environmental, Social, and Governance (ESG) and sustainability. Under the aforementioned company-wide participation guideline, all departments formed task forces to work on our five key sustainability goals, which form the core of our corporate goals. They also created action plans to realize these goals.
I sometimes think about how unusual it is that every department has a sustainability-related action plan. On the other hand, there is no doubt that sustainability is only going to grow in importance, and it is crucial to incorporate it into all aspects of our management strategy.
Our first action was to establish a new corporate philosophy. The Basic Sustainability Policy includes our approach to social issues in addition to our existing environmental policy, and clarifies how we will approach social issues going forward.
We also established a Sustainability Committee, led by the CEO. Executive officers of each division participate to discuss company-wide sustainability policies and strategies. Notably, our CEO concurrently serves as Chief Sustainability Officer (CSO), reflecting our belief that effective leadership is paramount to driving change and responding to stakeholder demands.
What led to your decision to undergo the EcoVadis assessment?
In 2017, we were told by one of our sales representatives that the EcoVadis assessment was a prerequisite to start working with a major European chemical manufacturer. This was our first time hearing about EcoVadis. It made us recognize the rapidly-evolving landscape of sustainability assessments as the questions were more extensive and wider-ranging compared to when we first obtained ISO 14001.
Before working with EcoVadis, we had responded to sustainability-related surveys at the request of our business partners, but we had not yet assessed our own sustainability. It was challenging to answer such a thorough survey, as we could not adequately identify our internal guidelines and initiatives. As a result, we were unable to meet the standard score required by our business partners on our first attempt.
Our subsequent action was to identify our ongoing initiatives and those that were missing. We already had an established corporate code of conduct and a code of conduct for our officers and employees. From there, we reassessed our initiatives regarding ISO 14001 certification and sustainability. After gathering and submitting new evidence, we were able to improve our score the second time around and meet the standards required by our business partners, allowing us to work with them.
Recently, we have received an increasing number of requests to share our EcoVadis scorecard from leading Japanese chemical manufacturers, major pharmaceutical companies, and global entities, which has also made us aware of the changing mindset around sustainability. In 2022, we were awarded a Bronze Medal, and were delighted to share our success with stakeholders.
What are some of the benefits of the EcoVadis assessment?
Our partnership with EcoVadis is featured in the Sustainability Report and website of our parent company, MC. Given that the EcoVadis assessment is globally recognized and highly credible, they are able to benefit from the promotion of our partnership.
In addition to sharing the scorecards, we have received requests from our business partners to conduct surveys and questionnaires related to sustainability and the reduction of greenhouse gas emissions. Some of these surveys ask us if we have been assessed by EcoVadis, which further underscores the value of the EcoVadis assessment as it leads to better scores on other surveys.
What advice would you give to companies who would like to enhance sustainability?
I think it is important for companies to respond to climate change. In particular, companies must adhere to frameworks like the Task Force on Climate-related Financial Disclosure (TCFD) and the disclosure of scope 3 emissions. In our case, we have created scenarios for calculating Scope 3 emissions and completed emissions calculations from 2020 onwards. The disclosure of non-financial information will ramp up as we continue to address climate change and carbon neutrality, which will increasingly become a competitive factor in the stock market.
However, climate action cannot be achieved through one company alone – it requires the efforts of the entire supply chain. Therefore, to ensure real change, it is important to establish sustainable practices across industries.
*In addition to obtaining ISCC (International Sustainability Carbon Certification) in 2023, the company established their Guidelines for Sustainable Supply Chain Management in 2024.
Lastly, please tell us about your company's vision for sustainability.
The chemicals we supply are raw materials. The supply chain from upstream basic chemicals to downstream final products follows a complex path, like byproducts branching off during a manufacturing process. Because of this complexity, we, as a company, have evolving methodologies and a duty to disseminate information. And, above all, we must ensure reliability and safety to our customers.
One of the three principles of our corporate philosophy is "shoki hoko," which means that we "strive to enrich society, both materially and spiritually, while contributing towards the preservation of the global environment.” Our vision has remained unchanged since our founding. Recently, the importance of carbon neutrality has emerged as a global trend and has become a wider mission of society as a whole. We at Mitsubishi Shoji Chemical Corporation are steadfast in our commitment to fostering a secure and trustworthy supply chain.
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