Evaluation Methods -Environmental Accounting FY2008-

The Ricoh Group disclosed its environmental accounting for the first time in 1999. Subsequently, the Group has 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 2005?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. In fiscal 2007, the Group started disclosing its environmental impact from a product lifecycle perspective, in addition to direct environmental impact (i.e., environmental impact generated 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.

Sustainable environmental management indicators of the entire product lifecycle (fiscal 2008)

Sustainable environmental management indicators of the entire product lifecycle (fiscal 2008)	Results in fiscal 2008	Calculation formula
REP: Ratio of Eco Profit	2.08	Total economic benefit (35.82) / Total environmental conservation cost (17.26)
REE: Ratio of Eco Effect	1.33	[Total economic benefit (35.82) + Social cost reduction values (-15.37 + 2.60)] / Total environmental conservation cost (17.26)
Eco Index	44.1	Gross profit on sales (854.3) / Total environmental impact (1,938,032.5) x 105
RPS: Ratio of Profit to Social Cost	2.8	Gross profit on sales (854.3) / Total social cost (300.86)

• *Unit: Billions of yen.
• *Environmental accounting data: Base units for raw materials production and fuel consumption were revised in fiscal 2008 to reflect the start of the new Environmental Action Plan. Evaluation was made using methods based on newly acknowledged information. The numerical figures in the graphs on the previous page were corrected to reflect these changes.

Ricoh Group's Corporate Environmental Accounting in fiscal 2008 (189KB)

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.	¥583.3 millon	Sales contribution ¥1,155.3 million	Reduction in payment for consumed power supply ¥422.5 million	Reduction in CO2 emissions 6,943.4 tons

• *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 a month. Internal benefits refer to benefits on gross profits in sales results in fiscal 2008.

Segment environmental accounting of the product recycling business (Japan)

Costs		Effects
		Economic benefits		Effect on environmental conservation
Items	Costs	Items	Benefits
Product recycling cost	¥632 million	Sales	¥12,999 million	mount of resource recovery: 26,440 (t) Down 2,229 (t) from that in the previous year	Amount of final disposal: 117 (t)
Collection/resource recovery cost	¥2,197 million
		Social effect	¥2,115 million
Total cost	¥2,829 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 (Japan)

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	¥273.7 million	Reduction in lighting and heating expenses	¥1,424.6 million	CO2 emissions (Reduction amount)	48,956.0(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 reduction measures taken in the past).