Promote Environment-Friendly Corporate Activities

Environment Policy

In recent years, environmental problems such as global warming have become more serious, and companies are required to take environment-friendly measures such as reducing greenhouse gases including CO₂. As a member of society, we will not only make effective use of limited resources and reduce the environmental impact of our corporate activities, but also actively engage in environmental preservation activities as part of our social contribution activities.

We will promote environment-friendly corporate activities and strive to reduce social environmental risks.
We will comply with environment-related laws and regulations, and actively meet requests from society.
We will understand and verify the impact of our corporate activities on the environment and strive for continuous improvement.
We will endeavor to ensure that our employees understand this policy and to educate them about the environment.
We will make this policy public through our website and disclose it widely outside the company.

SDGs Items

7 AFFORDABLE AND CLEAN ENERGY 12 RESPONSIBLE CONSUMPTION AND PRODUCTION 13 CLIMATE ACTION 15 LIFE ON LAND

Main Activities and Initiatives

Main Activities	Targets and Initiatives for Each Activities
Continued implementation of "green purchasing," selecting and purchasing items with the least environmental impact possible	Promote the purchase of low-impact products by taking environmental impact into consideration when purchasing goods
Introduction of renewable energy	Switch to renewable energy sources for power consumption by the end of FY March 31, 2023
Net-zero GHG emissions for the company	Net-zero GHG emmisions for the company by 2030
More Energy-efficient ATMs and Electric Signage, etc.	Decrease 1% per-unit energy use compared to the previous year
Community Clean-ups	Participate in cleanup activities held in the areas where our company is located
Forest Conservation	The "ACOM Forest" Forest Conservation Program

Introduction of Activities

Introduction of renewable energy

In response to the growing demand for environmentally friendly corporate activities, such as reducing CO₂ emissions and other greenhouse gases, we are introducing renewable energy sources. By the end of June 2022, we had switched to renewable energy at all of our 3 large sites and 630 automated contracting machines, all of which are under contract with us. We will continue to promote environmentally friendly corporate activities and strive to reduce environmental risks to society.

The implementation of cardless transaction functions

With the deepening severity of climate change and other environmental issues, we are working to reduce the environmental loads imposed by our products and services.
We updated our official smartphone app in October 2021. The update allows the customer to issue their credit card as a virtual card on the app, so they can enjoy cardless shopping. For card loans, they can use the app to read a QR code displayed on a Seven Bank ATM to withdraw and deposit money there without needing a card. This function helps to reduce plastic usage.
We will go on working to suppress the use of limited resources at the same time as we raise convenience for the customer.

Support for Paperless Operation

By putting some of the documents we send to our customers into paperless (electronic) form, we suppress the use of limited resources at the same time as we increase convenience for the customer. Customers who want to receive issued documents in electronic form can download contract-related documents and transaction-related statements from the members' site.
Within the company, we are working on switching to electronic forms for various application procedures, salary statements, in-house magazines, contracts agreed with business partners, and the like, reducing our use of resources. We are also promoting paperless operation of our various meeting bodies, for the sake of efficient meeting operation and environmental protection.

The "ACOM Forest" Forest Conservation Program

We began our "ACOM Forest" conservation program in June 2022 for purposes such as cutting greenhouse gas emissions and preserving biodiversity. We have signed agreements with Kanagawa and Osaka prefectures, where our Contact Centers are located, using the "Company forestry support system".
This activity contributes to the development and conservation of sound forests through work by employee volunteers. In Kanagawa, activities mainly include pruning branches*1 and thinning trees*2, and in Osaka, we are clearing underbrush*3 and planting trees. In FY2023, we held the activity four times in Kanagawa and seven times in Osaka. A total of 163 employees and their family members participated.
Through this activity, we are developing and conserving the environment in Kanagawa and Osaka, as well as fostering environmental awareness among our employees.

	FY 2022	FY 2023
Kanagawa	2	4
Osaka	2	7

Reducing Electricity Consumption of ATMs and Illumination Signboards

As a part of initiatives to prevent global warming, energy saving models and/or modes are used at ATMs installed at outlets. Moreover, some of our illumination signboards have installed LED. Therefore, we attempt to reduce CO₂ emission and electricity consumption. Furthermore, we prioritize energy efficiency when we consider and implement replacement and/or introduction of air conditioners and office equipment.

CO₂ Emission(Scope 1 and 2)

	FY 2021	FY 2022	FY 2023
t-CO₂	8,250	3,397	2,244

*Method of calculation changed from FY2022

Participating in Local Cleaning Projects

Employees participate in local cleanings projects of surrounding areas of bases to deepen communication with locals and keep towns clean.
70 cumulative employees participated in cleanup activities in Tokyo's Minato, Chiyoda and Chuo Wards, as well as Yokohama City in FY 2023.

Cleanup Events in FY 2023

Minato Ward	Clean Campaign: A Town with Zero Smoking on the Streets!
Chiyoda Ward	Chiyoda Ward Cleanup Day
Chuo Ward	Green Day on the Street Corner
Yokohama City	Hama Road Activities

Response to Climate Change and Environmental Protection Initiatives for the TCFD Recommendation

We engage in business activities to realize a sustainable global environment. We also aim to continuously expand our information disclosure related to climate change in line with the TCFD recommendations.

*The Task Force on Climate-related Financial Disclosures (TCFD) was established by the Financial Stability Board (FSB) in 2015 at the request of the G20 to ensure financial stability. The final report of the framework for disclosure of climate-related risks and opportunities (TCFD recommendations) released in 2017 requires the assessment of climate change risks and opportunities, the understanding of financial impacts after reflecting them in management strategies and risk management, and the disclosure of these risks.

Governance

In order to promote initiatives related to climate-related issues, the Company's Board of Directors has decided on an Environmental Policy. Promoting environmentally conscious corporate activities are one of our Materiality.

Materiality	SDGs Items
Promote environment-friendly corporate activities
Promote diversity based on "The Spirit of Human Dignity"
Provide financial services that put the customers first
Pursue creative and innovative management utilizing digital technology
Strengthen governance

In order to promote sustainability, including climate-related issues, we have placed the Sustainability Promotion Office, which examines and formulates sustainability plans of the Company, as a subordinate organization of the Finance Department. We have also established a sustainability promotion system that deliberates and decides on important matters at the Board of Directors and the Management Committee.

【Sustainability Promotion System】

The Sustainability Promotion Organization

Strategy

We have selected Materiality based on our corporate philosophy, which is the universal value that should be cherished the most, and the expectations of our stakeholders for addressing social issues.
We believe that realizing a sustainable global environment is important for the continuation of our business activities. Promoting environmentally conscious corporate activities is one of our Materiality.　We identify and recognize risks and opportunities related to climate change in our business activities, qualitatively analyze their impacts, and confirm the resilience of our management strategies. In response to the transition and transformation of a decarbonized society, we aim to increase our corporate value through the provision of financial services and the improvement of our product quality.

Risk Recognition

Climate-related risks are identified and recognized by classifying them into "transition risks" that arise in the process of transitioning to a low-carbon economy in response to climate change and "physical risks" that cause direct losses due to climate change.
The identified risks are assumed to be based on the type of damage (direct damage and indirect damage), the scale of the risk (large, medium, and small), and the time horizon (short-term and mid-to long-term). In the personal loan market, we are engaged in the Loan and credit card business, and Credit guarantee business. The increase in costs due to climate change is expected to be limited.

Risk categories		Examples of transition risk	Damage	Risk	Time frame
Transition Risk	Policies, Laws and Regulation Risk	Increase in business costs due to tightening of regulations related to climate change and changes in the tax system, such as the introduction of a carbon tax	Direct	Small	Mid-to Long-term
	Market Risk	Economic deterioration due to the effects of global warning Decrease in the balance of loans due to a decline in demand for funds	Indirect	Medium	Mid-to Long- term
	Reputation Risk	Stock price decline due to criticism from stakeholders for responding to global warming and inadequate information disclosure	Direct	Small	Mid-to Long- term
Physical Risk	Acute Risk	Impact on business continuity due to damage to offices and facilities by extreme windstorms and floods	Direct	Medium	Short-to Long- term
Physical Risk	Chronic Risk	Business relocation costs due to sea level rise	Direct	Medium	Long-term

* Short-term: less than three years; Medium-term: three to ten years; Long-term: more than ten years

Opportunity Recognition

We anticipate and recognize the following opportunities to address climate-related issues. We will incorporate these initiatives related to climate-related issues into our medium-term management plan and monitor the status of their implementation.

Opportunity	Examples of Opportunity	Time Frame
Resource Efficiency Energy Sources	Promotion of resource and energy conservation Use of Renewable Energy	Short- to Long-term
Product and Service Markets	Contribution to the environment and society through investment in green bonds, etc. Earn the trust of business partners and capital markets through appropriate initiatives and disclosure of climate-related issues	Short- to Long-term
Resilience	Ensure business continuity by building a robust BCP system	Short- to Long-term

Scenario Analysis

The following is a qualitative analysis of the impact of climate change on our group under two scenarios: a scenario in which global warming is halted by severe global warming countermeasures (2℃ scenario) and a scenario in which global warming continues without drastic global warming countermeasures (4℃ scenario).

	2℃ scenarios ^*1	4℃ scenarios ^*2
Assumption of the Analysis	Policies Reduce Greenhouse Gas Emissions Development and diffusion of low-carbon technologies Sudden windstorms and floods will occur on the same scale and frequency as today	Without drastic policies, greenhouse gas emissions will increase at the same speed as today The scale of damage has increased due to the expansion by scale and frequency of sudden storm and flood damage Chronic changes, such as sea levels rise, have a significant impact on economic activity
Opportunity	Growing needs for financial products and services related to environmental protection	Increased demand for funds related to infrastructure investment for disaster prevention measures
Risk	Transition Risks
	Stakeholder criticism of the Company's response to global warming caused the stock price to decline Increased equipment costs for measures to reduce greenhouse gas emissions and strengthen BCP	Loan balances decreased due to economic deterioration due to the effects of global warming
	Physical Risks
	Sudden extreme weather events will remain at the same level as they are now, and no significant impact on finances is expected Irreversible climate change, such as sea level rise, will not occur, and no significant financial impact is expected	Damage to real estate and facilities and impact on business continuity due to extreme windstorms and floods Damage to real estate and relocation costs due to rising sea levels

*1）2℃ Scenarios：IEA 2DS　*2）4℃ Scenarios： IPCC RCP8.5

Risk Management

In the Company, the department in charge of the risks to be managed as stipulated in the Risk Management Regulations identifies, evaluates, and controls the risks. The Compliance and Risk Management Department manages risks in an integrated manner. Risk management activities in the execution of business are discussed and reported at the Risk Management Report Meeting. The Risk Committee deliberates on important matters related to risk management, monitors the status of risk management, and makes recommendations and reports to the Board of Directors on the results.
As part of this risk management system, climate-related risks are managed within an integrated risk management framework based on our internal risk management system, as they are factors that generate and amplify credit risk, market risk, and other factors.

Metrics and the Targets

We are working to conserve resources and energy through the internal and external online meeting system, online approval systems, paperless meeting systems, and the digitization of documents.
Our greenhouse gas emissions are as follows: We will work to further reduce greenhouse gas emissions

【Greenhouse Gas Emission※】

			Unit	FY2019	FY2020	FY2021	FY2022	FY2023
Total(Consolidated)			t-CO₂	-	-	-	6,088	5,033
	Scope1Direct CO₂		t-CO₂	-	-	-	1,193	1,280
		Heavy oil A	t-CO₂	-	-	-	1	1
		Gasoline	t-CO₂	-	-	-	1,103	1,169
		Light oil	t-CO₂	-	-	-	89	110
	Scope2 IndirectCO₂emissions		t-CO₂	-	-	-	4,895	3,753
		Electricity	t-CO₂	-	-	-	4,623	3,459
		Steam/Hot water	t-CO₂	-	-	-	102	118
		Cold water	t-CO₂	-	-	-	171	176
Total(Non-Consolidated)			t-CO₂	9,959	9,061	8,250	80,085	77,606
	Scope1Direct CO₂emissions		t-CO₂	0	0	0	18	18
		Heavy oil A	t-CO₂	-	-	-	1	1
		Gasoline	t-CO₂	-	-	-	17	17
	Scope2 Indirect CO₂emissions		t-CO₂	9,959	9,061	8,250	3,379	2,226
		Electricity	t-CO₂	9,773	8,870	7,995	3,107	1,974
		Steam/Hot water	t-CO₂	55	59	92	102	76
		Cold water	t-CO₂	131	132	163	171	176
	Scope3 Other indirect CO₂emissions		t-CO_2e	-	-	-	76,688	75,362
		Category1(Purchased goods and services)	t-CO_2e	-	-	-	67,393	70,582
		Category2 (Capital goods）	t-CO_2e	-	-	-	2,886	972
		Category3 (Fuel-and-energy-related activities, not included in Scope 1 or 2)	t-CO_2e	-	-	-	1,239	-
		Category4 (Upstream transportation)	t-CO_2e	-	-	-	2,720	1,855
		Category5 (Waste)	t-CO_2e	-	-	-	132	-
		Category6 (Business trip)	t-CO_2e	-	-	-	1,334	815
		Category7 (Commuting)	t-CO_2e	-	-	-	978	1,311
		Category8 (Upstream leased assets)	t-CO_2e	-	-	-	0	-
		Category9 (Downstream transportation and distribution)	t-CO_2e	-	-	-	0	-
		Category10 (Processing of sold products)	t-CO_2e	-	-	-	0	-
		Category11 (Use of sold products)	t-CO_2e	-	-	-	0	0
		Category12 (Abandonment of sold products)	t-CO_2e	-	-	-	7	7
		Category13 (Downstream leased assets)	t-CO_2e	-	-	-	0	0
		Category14 (Franchises)	t-CO_2e	-	-	-	0	-

※Calculation method from FY2018 to FY 2021: Hot water, cold water, and heavy oil A are calculated using coefficients based on the "Act on Promotion of Global Warming Countermeasures". Electricity is calculated according to the most recent emissions factors for each electric utility for FY2020 based on the Act on the Promotion of Global Warming Countermeasures. This report calculates the market based figures based on the "basic emission factor (pre adjustment emission factor)", in which power companies do not reflect Kyoto Mechanism credits or cuts in domestic certified emissions, etc.
Calculation method of FY 2022: Hot water, cold water, heavy oil A, Gasoline and light oil are calculated according to factors based on the Act on Promotion of Global Warming Countermeasures and "GHG Protocol". Electricity is calculated according to the most recent emissions factors for each electric utility for FY2020 based on the Act on the Promotion of Global Warming Countermeasures and other laws and regulations in each country. (Market-based figures: Adjusted emission factor (by menu) for each electric utility; location-based figures: Alternative values (e.g., emission factors by country as specified by the International Energy Agency)). Scope 3 is calculated using the latest version of the Emission Intensity Database for Calculating GHG Emissions of Organizations throughout the Supply Chain", "Global Environmental Burden Intensity Based on Buyer Price Basis," and "IDEAv2 (for Calculating Greenhouse Gas Emissions of Supply Chain)."

Unit：％	FY 2019	FY 2020	FY 2021	FY 2022	FY 2023
Ratio of energy consumption per unit of production to the previous year	99.7	96.1	91.4	107.0	91.9