Sustainable environmental management indicators -Environmental Accounting FY2002-

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Fiscal 2002 Environmental Accounting

The environmental conservation cost of the Ricoh Group as a whole increased approximately 17% compared with that in the previous fiscal year due to increases in the recycling-related cost and environmental management system maintenance cost. As for the economic effects of each cost item, the upstream/downstream cost, representing product recycling-related costs, increased 34% year on year, but profit from the sales of recycled products increased roughly 76%, which shows that the recycling business has steadily improved, moving towards the breakeven point. Regarding environmental conservation effects, environmental impact was not reduced much in fiscal 2002 compared with that in the past. However, considering the fact that total environmental impact (expressed in terms of greenhouse gas emissions) was reduced by half compared with that in fiscal 2000, the reduction in fiscal 2002 does not appear too unreasonable. Sustainable management indicators showed satisfactory results. For example, the eco-index increased about 18% compared to the last fiscal year, to 1,423.7, which is 2.6 times that in fiscal 2002. Also in fiscal 2003, the indicator is expected to increase as much as approximately 6%.
The Ricoh Group promotes the establishment of Eco Balance environmental accounting, and it is now possible to calculate sustainable management indicators based on the environmental impact caused by and the cost of environmental measures taken for the domestic image-related product business. We will also examine the introduction of sustainable management indicators based on the evaluation of each product's environmental cost and benefit. Such indicators will be used as numerical targets for each product in the environmental action plan.

Fiscal 2002 Ricoh Group Corporate Environmental Accounting(15.3KB)

Fiscal 2002 Ricoh Group Corporate Environmental Accounting

Change in gross profit and sustainable management indicators in the Ricoh Group
  Fiscal 2000 Fiscal 2001 Fiscal 2002
Ratio of eco profit 1.27 1.21 1.58
Ratio of eco effect 1.61 1.95 1.81
Eco index 538.8 1,204.1 1,423.7
Ratio of profit to social cost 40.9 100.8 108.9
Gross profit (100 millions of yen) 6,133 6,999 7,453

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Segment Environmental Accounting

Corporate environmental accounting targets corporate environmental activities as a whole but can be used in decision making only in limited cases. However, segment environmental accounting, in which corporate environmental activities are conducted by project, can be used in decision making in many cases. Segment environmental accounting is especially useful in predicting the effects of environmental activities. The Ricoh Group announced its adoption of segment environmental accounting in 1999 and put it into practice by taking various measures. In fiscal 2002, the Group continues its efforts to promote sustainable management by conducting segment environmental accounting at various opportunities.

Actual Costs and Effects of Developing QSU Products (Copiers/Printers) (Segment Environmental Accounting)

We are aggressively introducing our proprietary energy-saving technology QSU to major models in the hope that more customers will use these models and more effectively reduce their environmental impact. The products marketed by the Ricoh Group in fiscal 2002 contributed more to impact reduction than those marketed in fiscal 2001, resulting in an 18,100-ton reduction in CO2 emissions per year. In terms of electricity fees charged to customers, the reduction is equivalent to ¥1,161.6 million in savings. Also, segment environmental accounting shows that QSU technology brought about a profit of ¥2,305 million to the Ricoh Group.

Costs Effects
Economic benefits Effect on environmental conservation
Item Main costs Amount Corporate effect Customer effect
Research and development Development of energy-saving units
¥400 million Effect on profit ¥2,305.0 million Reduced electricity expenses ¥1,161.6 million Reduced CO2 emissions 18,100 tons
Molds, Jigs, and Parts ¥458 million
  • *Figures for reduced electricity expenses and CO2 emission represent the benefits gained for an entire year if the machines is used eight hours a day, 20 days a month. The figure for corporate effectrepresents the effect on gross margin for fiscal 2002 sales.
Estimated Costs Efficiency of an Ice Thermal Storage/Chilled Water System in Environmental Conservation (Segment Environmental Accounting)

Much of the equipment at Ricoh Microelectronics Co., Ltd. plants produces heat, making 24-hour air conditioning indispensable. Air conditioning accounts for more than half the total energy consumption at these plants. In May 2002, the company installed new air-conditioning systems that combine an ice thermal storage system and a chilled water system for improved environmental performance and economic efficiency. The systems enable 24-hour operation by making ice and chilled water at night. Replacement of the heavy oil thermal power generation system has reduced carbon dioxide emissions by 866 tons and electric power and water utility expenses by approximately 14.3 million yen.

Costs Effects
Economic benefits Effect on environmental conservation
Items Main costs Amount Items Amount
reduced
Item Amount
reduced
Business
area costs
Investment 34.45
(millions
of yen)
(Difference
from the
conventional
method)
Reduction in heat and light expenses 12.9 (millions
of yen)
CO2
emission
866(t)
Reduction in water expenses 1.4
(millions
of yen)
Water consumption 10.9(t)
  • *Effects are calculated through a comparison to fiscal 2000 figures.
  • *Calculated from total investment (¥169 million)
Costs and Effects of Hot Runners for Injection Molding (Segment Environmental Accounting)

Ricoh's Atsugi Plant replaced the runners of the 350-ton injection molding equipment (which are used to align the position of materials in molds) with hot runners. This resulted in a reduced discharge of waste plastic and lower materials costs. The old runners were crushed for recycling, but some parts had to be disposed of due to their composition. Hot runners, by contrast, produce no waste because parts can easily be broken down and reused. From September 2002 through March 2003, the plant reduced waste plastic by 19.2 tons and costs by ¥21 million.

Costs Effects
Economic benefits Effect on environmental
conservation
Item Main cost Amount Reduction Amount Reduction Amount
Business
area cost
Design and production cost ¥2.56 million Waste disposal expenses ¥1.86 million Amount of waste discharged 19.2(t)
Material cost, etc.  ¥21.77 million
  • *Effects are calculated for seven months, starting from September 2002.
Costs and Effects of Water-based Cleaning of Ink-Fixing Rollers at RIF (Segment Environmental Accounting)

Ricoh Industrie France S.A. has developed a water-based paint to replace its organic solvent-based paint. The use of the water-based paint reduced emissions of volatile organic compounds into the air by 83%, resulting in total cost savings of ?121,500, since the second half of 1998.

Costs Effects
Economic benefits Effect on
environmental
conservation
Item Main costs Amount Reduction Amount Reduction Amount
Business area cost Investment cost 452 EURO Solvent cost 121,500 EURO Amount of organic solvent used 1.32(t)
  • *Effects are calculated for the period starting from the second half of fiscal 1998.
Costs and Effects of a Modal Shift from Trucks to Railways (Segment Environmental Accounting)

Aiming to reduce the environmental impact and cost of product transportation, Tohoku Ricoh Co., Ltd., a manufacturing subsidiary, entered into partnership with Japan Freight Railway Company to promote a modal shift from truck to railway transportation. This resulted in a reduction of carbon dioxide emissions of 117 tons and a cut in transport expenses of approximately 57 million yen.

Costs Effects
Economic benefits Effect on
environmental
conservation
Item Main costs Amount Reduction Amount Reduction Amount
Business area cost Investment cost 0 yen Transportation cost ¥57.4 million CO2 emission 117 (t)
  • *Effects are calculated for the period starting from October 2001.
    There was no initial investment.
Environmental Conservation Costs and Effects in the Recycling Business in 2002(Segment Environmental Accounting)

Efforts made in Japan include improving the collection, recovery, and recycling efficiency by making use of a recycling information-sharing system and nationwide recycling system. Increased profitability will be achieved by significantly reducing the cost of collection and disposal through an advanced venous logistics system and increasing the sales of recovered machines. For regions other than Japan, it was decided that used products will be collected, recovered, and sold within the same region. Efforts are being focused on improving collection rates and the expansion of recycling sites. The Group's recycling activities are thus evolving into a recycling business.

Costs Effects
Economic effects Effects on environmental conservation
Item of cost Amount Item Reduced
Amount
Product recycle cost ¥918
million
Sales amount ¥1,421
million
Resources recovered
26,422 t
A 498-t increase
from the previous year
Final disposal 37 t
A 313-t decrease
from the previous year
Collection/resource
recovery cost
¥2,772
million
Social effect ¥2,114
million
Total cost ¥3,690
million
  • *Data is for Japan only. The figure for "Social effect" is the amount that customers saved on the cost of waste disposal.

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