Sustainable environmental management indicators -Environmental Accounting FY2006-

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The Ricoh Group disclosed its environmental accounting for the first time in 1999. Subsequently, the Group introduced corporate environmental accounting to determine the status of sustainable environmental management and disclose related information, as well as segment environmental accounting and business sector environmental accounting that are used to prepare environmental action plans, select measures, and verify achievements. Thus efforts are being made to establish environmental accounting as a tool for sustainable environmental management.

 

Corporate Environmental Accounting

This is compiled in accordance with the Environmental Accounting Guidelines of the Japanese Ministry of the Environment and used as a tool to inform the public of relevant information. The Ricoh Group takes the necessary portion from the Eco Balance data, and calculates the cost and effect (in quantity and monetary value) of its environmental conservation activities based on its own formulas and indicators. The calculated results are disclosed to the public after being verified by a third-party organization.

 

Segment Environmental Accounting

This is an internal environmental accounting tool to select an investment activity, or a project, related to environmental conservation from among all processes of operations, and to evaluate environmental effects for a certain period. The effect of investment on environmental conservation will be calculated based on the concept of "Return on Investment" (ROI). The calculation result is used internally for decision making in sustainable environmental management. Ricoh Group companies and divisions, such as its recycling business division, increasingly utilize segment environmental accounting for their operations.

 

Business Sector Environmental Accounting

The Ricoh Group engages in environmental activities in many business sectors. The Group examines and uses this indicator internally as an environmental accounting tool to determine how such environmental activities contribute to sustainable environmental management conditions in respective business sectors.

 

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Review of Corporate Environmental Accounting for Fiscal 2006

When we look at the trend for the whole Ricoh Group, we see an improvement in the Eco Index, the ratio between gross profit on sales and total environmental impact, while our business is expanding. This means that the Ricoh Group is able to reduce its environmental impact in proportion to the added-value of its business activities (see graph (2)). The Ratio of Eco Profit, an indicator of the cost-effectiveness of sustainable environmental management activities, and the Ratio of Eco Effect, an indicator that takes into account the social cost reduction values, remained unchanged over the figures for fiscal 2005. This was because the environmental cost and the increase in economic benefit have increased at the same rate, and this means that we have been able to maintain our cost-effectiveness (see graph (1)). When we look at the cost and economic benefit data in the corporate environmental accounting for fiscal 2006, there is a substantial increase in upstream and downstream costs and in the sales value of recycled products, which means that the recycle-related businesses is growing. Substantial effects of savings on electric power and more efficient waste disposal campaigns dropped drastically from ¥580 million in fiscal 2005 to minus ¥160 million. This was caused by the increase in payments for utilities and waste disposal services due to business growth across the whole Group. Similarly, the effect on environmental conservation was that CO2, NOx, and BOD figures increased as a result of our business growth. We will work on reducing environmental impact and enhancing efficiency from an energy-saving and resource conservation point of view, including improvements to our production processes. We will thus advance towards our goal of sustainable environmental management.

Change in the Ricoh Group's sustainable environmental management indicators

Change in the Ricoh Group's sustainable environmental management indicators

The Ricoh Group's Sustainable Environmental Management Indicators (fiscal 2006)
Sustainable environmental management indicators Results in fiscal 2006 Calculation formula
REP: Ratio of Eco Profit 1.89 Total economic benefit (34.59)/Total environmental conservation cost (18.27)
REE: Ratio of Eco Effect 2.05 [Total economic benefit (34.59) + Social cost reduction values (0.16+2.66)]/Total environmental conservation cost (18.27)
Eco Index 2,369.8 Gross profit on sales (¥862,400,000 thousand)/Total environmental impact (363,913)
RPS: Ratio of Profit to Social Cost 146.2 Gross profit on sales (862.4)/Total social cost (5.9)
  • *Monetary units are indicated in billions of yen unless otherwise indicated.
Ricoh Group's Corporate Environmental Accounting in fiscal 2006 (121kb)

Ricoh Group's Corporate Environmental Accounting in fiscal 2006

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Segment Environmental Accounting

Segment Environmental Accounting of Product Energy Conservation (Benefit on cost in color QSU product development)
Costs Effects
Economic benefits Effect on environmental conservation
Item Main costs Costs Internal benefits Customer benefits
R&D cost Cost of developing energy-saving units, parts, etc.
¥456.0 millon Sales contribution ¥496.9 million Reduction in payment for consumed power supply
¥192.2 million
Reduction in CO2 emissions
3,158.6 (t)
  • *The reduction in payment for consumed power supply and CO2 emissions is the annual benefit brought from 8 hours of operation per day, 20 days of operation a month. Internal benefits refer to benefits on gross profits in sales results in fiscal 2006.
Segment Environmental Accounting of the Product Recycling Business (Japan)
Costs Effects
Economic benefits Effect on environmental conservation
Items Costs Items Benefits
Product recycling cost ¥654 million Sales ¥9,215 million Amount of resource recovery: 31,430 (t)
Down 230 (t) from that in the previous year
Amount of final disposal: 186 (t)
Collection/resource recovery cost ¥2,771 million
Social effect ¥2,514 million
Total cost ¥3,425 million
  • *Social effect refers to the cost of waste disposal that customers no longer have to pay.
Segment Environmental Accounting of Energy Conservation Activities at Business Sites (The Entire Ricoh Group)
Costs Effects
Economic benefits Effect on environmental conservation
Item Main cost Costs Item Benefits Reduction item Amount
Business area cost Cost of global warming prevention ¥520.8 million Reduction in lighting and heating expenses ¥337.0 million CO2 emissions 11,581.5 (t)
Segment Environmental Accounting of Recycling Activities at Business Sites (The Entire Ricoh Group)
Costs Effects
Economic benefits Effect on environmental conservation
Item Main cost Costs Item Benefits Reduction item Amount
Business area cost Resource circulation cost ¥1,888.4 million Reduction in discharged matter disposal costs ¥183.3 million Amount of waste disposed/ reduced 124.3 (t)
Proceeds from sale of valuables ¥487.3 million
Segment Environmental Accounting of Pollution Prevention Activities at Business Sites (The Entire Ricoh Group)
Costs Effects
Economic benefits Effect on environmental conservation
Item Main cost Costs Item Benefits Reduction item Amount
Business area cost Resource circulation cost ¥186.4 million Reduction in
social cost
¥15.4 million NNOx
SOx
BOD
PRTR substances (Calculated with the conversion potential)
-5.0 (t)
1.1 (t)
-3.1 (t)
101.7 (t)
Amount of risk avoidance effect (incidental effect) ¥1,226.6 million
  • *PRTR substances refer to the Ricoh target substances for reduction.

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An overview of our environmental accounting from FY 1998 to FY 2012

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  • Indicators The Ricoh Group calculates environmental preservation costs and benefits based on calculation formulas and indicators developed by Group companies.

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