Sustainable environmental management indicators -Environmental Accounting FY2007-

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Summary

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 etc., 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

The Ricoh Group calculates and announces the cost spent in its business activities for environmental conservation, as well as their conservation and economic effects, as quantitatively as possible. The Ricoh Group prepares such data in compliance with the Environmental Accounting Guidelines set by the Japanese Ministry of the Environment, by taking the necessary portion from the Eco Balance data and calculating 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 verified by a third-party organization. In fiscal 2007, the Group started disclosing environmental impact from a viewpoint of Eco Balance, in addition to direct environmental impact (environmental impact at business sites).

 

Segment Environmental Accounting

This is an environmental accounting tool to forecast the costs and environmental conservation/economic effects of individual investment activities and projects for environmental conservation from among all processes of operations and to evaluate their results, in order to judge the effectiveness of respective measures.

 

Material Flow Cost Accounting

This is a method used to detect processes that can be improved cost-effectively by analyzing loss in each process of the material flow of products. The Ricoh Group has introduced this accounting into some of the business areas on a trial basis and found that it is particularly effective in sectors with large amounts of material loss.

 

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Review of Corporate Environmental Accounting for Fiscal 2007

Environmental accounting is designed to present the costs incurred for environmental conservation activities during a given period in comparison to the resulting benefits. Such costs and benefits represent how well the environmental impact reduction activities by the Ricoh Group and across the entire life cycle of its products were performed. We therefore began presenting the environmental conservation effect and environmental impact by our upstream and downstream operations, together with those by the Ricoh Group from this year, so that the readers can understand and compare the environmental conservation effects and environmental impact by the Group and those generated throughout the product life cycle. When we look at the overall trend, we see a continuing improvement since fiscal 2006 in the Eco Index, 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, improved over the figures for fiscal 2006. This means that we have been able to improve our cost-effectiveness (see graph (1)). When we look at the environmental accounting data by item, we see a decrease in business area costs (including those of pollution prevention, global environmental conservation, and resource circulation) and social activity costs (including those of preparing environmental reports and advertisements), and an increase in the R&D costs for future environmental impact reduction. Among economic benefits, there is a substantial increase in those from products and parts recycling activities. This continuing trend from the previous period contributes to boosting of the overall economic benefits.

Changes in the Ricoh Group's sustainable environmental management indicators

Ratio of Eco Profit and Ratio of Eco Effect

Eco Indicator

The Ricoh Group's Sustainable Environmental Management Indicators (fiscal 2007)
The Ricoh Group's Sustainable Environmental Management Indicators (fiscal 2007) Results in fiscal 2007 Calculation formula
REP: Ratio of Eco Profit 2.20 Total economic benefit (39.51) / Total environmental conservation cost (17.99)
REE: Ratio of Eco Effect 2.34 [Total economic benefit (39.51) + Social cost reduction values (0.22+2.43)] /Total environmental conservation cost (17.99)
Eco Index 2,636.8 Gross profit on sales (¥927,700,000 thousand) / Total environmental impact (351,831)
RPS: Ratio of Profit to Social Cost 151.0 Gross profit on sales (927.7) / Total social cost (6.14)
  • *Monetary units are indicated in billions of yen unless otherwise indicated.
Sustainable environmental management indicators of the entire product life cycle (fiscal 2007)
Sustainable environmental management indicators of the entire product life cycle (fiscal 2007) Results in fiscal 2007 Calculation formula
REP: Ratio of Eco Profit 2.20 Total economic benefit (39.51) / Total environmental conservation cost (17.99)
REE: Ratio of Eco Effect 2.34 [Total economic benefit (39.51) + Social cost reduction values (2.43+0.12)] /Total environmental conservation cost (17.99)
Eco Index 41.91 Gross profit on sales (¥927,700,000 thousand) / Total environmental impact (22,137,468.7)
RPS: Ratio of Profit to Social Cost 2.4 Gross profit on sales (927.7) / Total social cost (386.58)
  • *Monetary units are indicated in billions of yen unless otherwise indicated.
Ricoh Group's Corporate Environmental Accounting in fiscal 2007 (195kb)

Ricoh Group's Corporate Environmental Accounting in fiscal 2007

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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.
¥647.7 millon Sales contribution ¥945.3 million Reduction in payment for consumed power supply
¥238.2 million
Reduction in CO2 emissions
3,914.0 (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 2007.
Segment Environmental Accounting of the Product Recycling Business (Japan)
Costs Effects
Economic benefits Effect on environmental conservation
Items Costs Items Benefits
Product recycling cost ¥732 million Sales ¥11,977 million Amount of resource recovery: 28,669 (t)
Down 2,761 (t) from that in the previous year
Amount of final disposal: 163 (t)
Collection/resource recovery cost ¥2,545 million
Social effect ¥2,294 million
Total cost ¥3,277 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 ¥296.3 million Reduction in lighting and heating expenses ¥1,113.4 million CO2 emissions 38,260.0 (t)
  • *The amount of reduction in CO2 emissions is the total of reductions realized through measures taken by respective sites to prevent global warming (including the effects of measures taken in the past).
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 ¥1,425.9 million Reduction in discharged matter disposal costs ¥12.4 million Amount of waste disposed/ reduced 10.7 (t)
Proceeds from sale of valuables ¥639.9 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 ¥242.4 million Reduction in
social cost
¥210.3 million NNOx
SOx
BOD
PRTR substances (Calculated with the conversion potential)
8.6 (t)
0.6 (t)
3.4 (t)
33.4 (t)
Amount of risk avoidance effect (incidental effect) ¥2,069.5 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 2013

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