Response to TNFD Recommendations
The Group recognizes that the environmental impact
associated with its business activities affects biodiversity, in
view of which we have endorsed the TNFD recommendations
and joined the TNFD Forum*1.
The Group is furthermore committed to reducing various
environmental impacts—including by undertaking initiatives
related to resource conservation and climate change
countermeasures—in order to preserve and protect
biodiversity. In addition, through the development of our
veterinary pharmaceutical and feed additive businesses, we
contribute to building a society where humans and animals can
coexist. As our initial response to the TNFD recommendations,
we took the steps outlined at right.
- Raising awareness and sharing direction within the Company
In April 2025, we distributed an original training video
on biodiversity to all employees, aiming to raise
awareness and share direction.
- Evaluation and management of nature-related issues
Using the LEAP Approach*2, an evaluation methodology
developed by the TNFD, we analyzed nature-related
opportunities and risks, and are in the process of
gauging the effect on our finances.
- Relationship with our business
Through our veterinary pharmaceuticals and animal
feed additives, in particular, we are contributing to
building a society in which humans and animals can
co-exist. We are keenly aware of the relationship
between our business and nature.
Governance
As part of our stakeholder engagement, the Group regards the promotion of environmental management, as well as biodiversity conservation that underpins such efforts, as issues that should be addressed on an ongoing basis. We have established a “Human Rights Policy” that commits us to promoting respect for human rights throughout our business activities across the entire value chain—including research and development, procurement, manufacturing, inventory management, distribution, sales, prescription by medical institutions, and use by patients. In line with this policy, we conduct training programs to deepen understanding of the importance of respecting human rights and compliance, and we are working to create a workplace in which each employee can fully demonstrate their capabilities while safeguarding individual dignity. In addition, to maintain and promote sound and constructive labor-management relations, we provide numerous opportunities for labor-management dialogue on a wide range of issues, including labor conditions, the working environment, and work-style initiatives to support the next generation. Through these efforts, we ensure employees’ rights and foster healthy and positive labor-management relations.
Furthermore, in parallel with our initiatives based on the TCFD*3, we will continue to advance our efforts toward the TNFD under our ESG promotion framework. Please refer to the following section for information disclosure based on the TCFD recommendations.
* “Information Disclosure Based on the TCFD Recommendations”
https://www.aska-pharma-hd.co.jp/english/csr/sustainability/tcfd.html
Strategy
The Group assesses the potential impacts of nature-related dependencies, impacts, risks, and opportunities on its business strategy and financial planning, and integrates these considerations into its management strategy.
Overview of Identified Nature-Related Risks and Opportunities
Based on the LEAP approach, the Group has identified the following key nature-related risks and opportunities across its entire value chain. In identifying these issues, we applied ENCORE*4, based on dependencies and impacts (double materiality), to assess material nature-related issues throughout the Group’s value chain and subsequently developed a heat map.
A. Assessment of Dependencies and Impacts Across the Value Chain
|
| Dependency |
Upstream -
Procurement |
VH |
--- |
| H |
--- |
| M |
Flood control, Soil, Severe storms, Water flow regulation, Water supply, Water purification |
| L |
Vegetation, Ecosystem |
| VL |
Air filtration, Microorganisms, Noise |
Direct Operations -
R&D, Manufacturing, Sales |
VH |
Water purification |
| H |
Water flow regulation, Water supply |
| M |
Flood control, Soil, Severe storms |
| L |
--- |
| VL |
--- |
Downstream -
Distribution, Prescription, Administration |
VH |
--- |
| H |
--- |
| M |
Water purification, Soil, Severe storms, Water flow regulation, Water supply |
| L |
Ecosystem |
| VL |
Air filtration, Antibacterial, Climate change mitigation, Rainfall |
| Impact |
Upstream -
Procurement |
VH |
Noise, Soil pollution |
| H |
--- |
| M |
GHG emissions, Air pollutants, Ecosystem, Water use, Waste |
| L |
Land use area |
| VL |
--- |
Direct Operations -
R&D, Manufacturing, Sales |
VH |
--- |
| H |
--- |
| M |
Noise, GHG emissions, Air pollutants, Waste |
| L |
Vegetation, Ecosystem, Microorganisms |
| VL |
Air filtration, Ecosystem |
Downstream -
Distribution, Prescription, Administration |
VH |
--- |
| H |
--- |
| M |
GHG emissions, Air pollutants, Water use |
| L |
Land use area |
| VL |
Noise, Soil pollution, Waste |
B. Identification of Materiality Across the Value Chain
|
|
C. LEAP Approach
| Locate |
| Business sites |
At the Iwaki Factory and Shonan Recerch Center, we are tracking
water resource usage and characteristics of the surrounding
ecosystems. We conduct water risk assessments at both sites
as they are located in areas deemed to have relatively high
water stress. |
| Supply chain |
When procuring pharmaceutical active ingredients, we identify
whether they come from areas rich in biodiversity or areas at risk
from deforestation and water pollution. This also applies to
procuring raw materials for feed additives in our veterinary
pharmaceuticals business. |
| Evaluate |
| Dependence |
We have determined that our business activities depend on clean
water resources and stable ecosystem services (e.g., soil health
and biological resources). |
| Impacts |
We assessed changes in land use and impacts on ecosystems
associated with water use, wastewater discharge during the
production process, waste disposal, and raw material procurement. |
| Assess |
| Risks |
Physical risks |
Risk of halt to operations due to increased
water stress, risk of instability in supply of raw
materials due to ecosystem degradation |
| Transition risk |
Increase in costs accompanying stricter nature-
related regulations (e.g., higher water quality
standards, expansion of biosphere reserves) and
change in product preferences as consumers
become more environmentally aware |
| Reputation risk |
Damage to corporate image due to negative
impact on biodiversity |
| Opportunities |
Development of
new products
and services |
Development of ecosystem-friendly
pharmaceuticals and adoption of production
processes with smaller environmental footprint |
| Efficiency
improvement |
Lowering costs by reducing water usage and
recycling waste |
| Enhancing
brand value |
Enhancing corporate value by contributing to
protection of the natural environment |
Impact on Business Strategy
The identified nature-related risks and opportunities may have the following impacts on our business model and financial planning.
| Research and Development |
We will prioritize investments in the discovery of new pharmaceutical candidates with lower impacts on ecosystems, as well as in research and development of sustainable manufacturing process technologies.
|
| Production |
At manufacturing sites located in water-stressed areas, we will strategically promote the introduction of water recycling systems and the enhancement of water-saving facilities to ensure stable operations.
|
| Procurement |
We will prioritize transactions with suppliers that take biodiversity conservation into consideration and strengthen our standards for sustainable raw material procurement. Through these efforts, we aim to enhance supply chain resilience and reduce the risk of future supply disruptions.
|
| Financial Planning |
We are considering incorporating the necessary funds for nature-related risk response measures (e.g., environmental technology investments and supply chain audits) into our budgets, while reflecting opportunities (e.g., increased sales from environmentally conscious products) in our financial targets.
|
Business Resilience
The impacts of nature-related risks and opportunities on our short-, medium-, and long-term resilience are as follows.
| Short term (up to 3 years) |
We will minimize the risk of temporary operational disruptions caused by water shortages or tighter local environmental regulations through water-saving measures and enhanced wastewater treatment.
|
| Medium term (up to 10 years) |
To address risks associated with the degradation of natural capital within the supply chain, we will maintain a stable supply of raw materials by introducing sustainable procurement policies and securing alternative sources.
|
| Long term (over 10 years) |
In response to broader societal changes resulting from the loss of ecosystem services, we will create environmentally friendly new technologies and products through research and development, and by leading social transformation, we will build a foundation for long-term business growth.
|
*1 TNFD Forum:
An international organization established in June 2021 to support discussions within the Taskforce on Nature-related Financial Disclosures (TNFD) as a stakeholder providing expert knowledge, with the aim of developing a framework for corporate risk management and disclosure related to nature.
*2 LEAP Approach:
An assessment methodology developed by the TNFD to evaluate and manage nature-related issues.
It consists of four steps—Locate, Evaluate, Assess, and Prepare—and analysis using this approach covers a substantial portion of the disclosures recommended by the TNFD.
*3 TCFD:
The Task Force on Climate-related Financial Disclosures (TCFD), established by the Financial Stability Board (FSB) at the request of the G20 and chaired by Michael Bloomberg, to consider climate-related disclosures and responses by financial institutions.
*4 ENCORE:
An online tool designed to help assess exposure to nature-related risks and to understand dependencies and impacts on nature.
*This section presents the results of our TNFD-related considerations as of October 2025. Going forward, we will continue to advance our review of risk and impact management, metrics and targets, and other related matters, and disclose updates as appropriate.
Biodiversity Initiatives
Please refer to the following page for details on the ASKA Pharmaceutical Group’s biodiversity initiatives.
Biodiversity