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Sustainable environmental management indicators -Environmental Accounting FY1998-

Ricoh's View on Environmental Accounting

Considering the importance of sound cost management in sustaining environmental conservation activities, Ricoh began environmental accounting. Under its environmental accounting, Ricoh focuses on the quantitative as well as economic effects of its environmental conservation activities. Ricoh wants to base such activities on eco-efficiency, which ensures the efficient reduction of the activities' environmental impact by clarifying environmental conservation effects and corporate growth. We are beginning to fully realize the environmental cost balance of the Ricoh Group's recycling activities by assessing cost-effectiveness on a management level through Corporate Environmental Accounting*1 a practical level through Segment Environmental Accounting*2 in each division. Thus, Ricoh will contribute to the creation of a recycling society.

  • *1 Corporate Environmental Accounting
    The environmental accounting of overall corporate activities, which is made public
  • *2 Segment Environmental Accounting
    Environmental accounting that represents the cost-effectiveness for a part of such environmental conservation activities as recycling and resource recovery.

please see the referred page "Environmental accounting" in "Ricoh Group Environment Report 1999"

Objectives of Environmental Accounting

  • For the internal information on management
    To provide information on the Ricoh Group's environment-related costs, resulting in an appropriate project control of environmental investments.
  • For stakeholders
    To promote the understanding of environmental conservation activities by providing information on such activities and environmental cost balance.
  • For consumers
    To provide consumers with information on the Ricoh Group's environmental conservation activities, helping them make purchasing decisions.

Data coverage

Ricoh Co., Ltd., and other Ricoh Group companies worldwide (Ricoh Co., Ltd., only for fiscal 1998)

Cost coverage

Costs, such as facility depreciation costs, personnel costs, and other business expenses, that have additional environment-related costs (Cost classification complies with guidelines set by the Environment Agency, Government of Japan.)


  • Effects represented as environmental impact reduction amount (quantitative base)
  • Effects calculated as monetary amount (monetary base)

Environmental Accounting for FY 1998 (Corporate Environmental Accounting)

Unit: 100 million yen

Item Costs Effects
Main costs Mone-
Item Environ-
mental impact reduction
EE value
Direct environ-
mental costs
13.2 Facility depreciation
and maintenance costs
3.0 a Energy savings and improved waste processing efficiency
CO2 5,435t
NOx -3.9t
SOx 0.2t
Final waste disposal amount 3,279t
Water 456
million t
14.5 b Contribution to value-added production
14.0 c Avoidance of risk in restoring polluted environment; avoidance of lawsuits
Indirect environ-
mental costs
4.8 Costs for the divisions
in charge of environmental measures;
costs to establish and maintain the environmental management
0.8 b Improved efficiency in environmental education and the establishment of the environmental management system
mental R&D costs
11.8 Research and development costs for environmental impact reduction 0.7 a Cost reduction through eco-packaging
15.8 b Contribution to value-added research and development
15.6 Costs for recovery and reassembly for recycling used products 2.4 a Sales of recycled products, etc.
1.2 Costs for the preparation of environmental reports, advertisements,
and exhibitions
0.2 b Environmental advertising, etc.
- Costs for the restoration of soil pollution and environment
-related reconciliation
- - None
Total 46.6 51.4

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Environmental impact (total) Eco-ratio (100 million yen/ton)
CO2 142,553t
NOx 56.4t
SOx 5.6t
Final waste disposal amount 2,485t
Water 3,137,000t

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Scope of Effects

Economic effects (monetary base)

Substantial effects (actual gains from cost and energy reductions as well as sales of assets)
Expected effects (amount of economic effects expected under certain definitions)
Incidental effects (amount of cost reduction from the avoidance of such problems as pollution and lawsuits)

Environmental conservation effects (quantitative base)

Clarifies annual reduction amount and total amount of the five items, i.e., CO2, NOx, SOx, final waste disposal amount, and water. (Items continue to be reviewed.)

Environmental Efficiency

Environmental efficiency is defined by the following two criteria:

  1. EE value (eco-efficiency value)
    Represents the environmental impact reduction amount of the five environmental conservation items for a total amount of environmental costs required for a particular fiscal year.
  2. Eco-ratio (environmental impact profit ratio)
    Represents value-added business results for the total environmental impact amount of the five environmental conservation items generated in various stages of business activities.

Definition of EE value (unit: ton/100 million yen)
EE value = Environmental impact reduction amount/total amount of environmental costs
Definition of eco-ratio (unit: 100 million yen/ton)
Eco-ratio = Total sales profit/total environmental impact amount

Calculation Method of Effects

(The scope of effects and the calculation method continue to be reviewed.)

Direct Environmental Cost Effects

Amount of contribution to value-added production
(Production - Raw materials cost) x environmental ratio

Environmental ratio

= Environmental cost/total cost

Press effects

Space reported in newspapers/page space x advertisement cost per page Indirect Environmental Cost Effects

Indirect Environmental Cost Effects

Environmental education effects
Trainees in internal environmental education program x outside training costs for participating in outside training programs

EMS establishment effects

Number of sites where EMS has newly been established x outsourced consultant fee

Environmental R&D Cost Effects

Amount of contribution to value-added R&D
(Sales - Production cost of sales) x (R&D costs/total costs) x environmental ratio Product Recycling Cost Effects

Product Recycling Cost Effects

Recycling effects
Proceeds from sale of recycled products through product recycling

Social Activity Cost Effects

Advertisement effects
Number of accesses to environmental Web sites x costs for the preparation of environmental reports

A Case of Segment Environmental Accounting

FY1998 Environmental Accounting of Ricoh Numazu's Resource Recovery Activities 501

item main costs Costs
Direct Cost Treatment cost of leftover food 0.42
Indirect costs Costs for waste disposal and control, personnel expenses, etc. 4.22
Total   4.64

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Effects (Compared to FY 1997)
Item Mone-
Environmental impact reduction Total environmental impact
Reduced amount in waste disposal costs 27.01 Reduced waste disposal 265t Final disposal amount 0t
Profit from sales of assets Cost reduction due to green procurement 8.89
Total 50.25 Resource recovery rate 59.1% (End of FY 1997)
100% (End of FY 1998)

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