In this disclosure, we have adopted a double materiality approach that considers both financial materiality (the impacts of the environment and natural capital on business activities) and impact materiality (the impacts of business activities on the environment and natural capital).

In this disclosure, we provide information based on the four pillars of the TNFD recommendations: governance, strategy, risk and impact management, and metrics and targets.
In the fiscal year ended March 31, 2024, we assessed the Group’s dependencies and impacts on nature in both direct operations and upstream value chains, and conducted biodiversity significance assessments around major sites, excluding office functions that are considered to have relatively low dependencies and impacts on nature.
In the fiscal year ended March 31, 2025, we narrowed the scope to direct operations from among the business domains of eight divisions and corporate departments, conducted evaluations and analyses in line with the LEAP approach, and selected seven businesses after considering their dependencies and impacts on nature and their scale of revenues. We then evaluated and analyzed nature-related issues, including dependencies, impacts, risks, and opportunities.

For the major sites of the seven selected businesses, we assessed the natural conditions surrounding each site by using multiple TNFD-recommended tools (IBAT^*1, Aqueduct^*2, and GFW^*3) to understand the natural conditions surrounding each site. We then combined the factors that could constitute risks for each business (dependencies and impacts), identified through the LEAP approach, with assessments of the surrounding natural conditions, and identified sites that require particular attention in light of their surrounding natural environments.

The Group makes disclosures in line with the recommendations of the TCFD (Task Force on Climate-related Financial Disclosures). In this disclosure based on TNFD Recommendations, we have aligned the information with our TCFD disclosures, and going forward, we will promote the integration of TCFD and TNFD.

In this disclosure, the evaluations and analyses take into account both the present and the future. As we advance scenario analyses, we will examine the time horizons to be applied.

In response to the growing social importance of these issues, the Group revised the Toyota Tsusho Group Human Rights Policy and Behavioral Guidelines in March 2022, and through our business activities, we have been working to address social challenges. When launching new business operations, we conduct environmental impact assessments, engage in dialogue with local residents, and maintain regular relations with local communities after operations begin.
Also in 2022, we revised the former “Supply Chain CSR Guidelines” into the “Supply Chain Sustainability Guidelines” to more clearly define the Group’s approach to human rights and the environment. Upon revision, these Guidelines were re-communicated to approximately 6,000 suppliers of Toyota Tsusho and its domestic and overseas consolidated subsidiaries, encouraging their implementation in practice.

The Group’s Board of Directors, comprising nine members including four outside directors, makes decisions on key management issues and monitors the execution of business by the directors.

The Board regularly discusses on the nature-related issues are through yearly updates and reports from the Sustainability Committee on progress and outcomes of its initiatives, as well as through deliberations on investment and loan decisions several times a year. These processes ensure that oversight is appropriately carried out by the Board. In addition to nature-related matters, the Board also receives reports and exercises oversight, as appropriate, on other important sustainability issues, such as climate change, human rights, and compliance.

The Group has established the Sustainability Committee as a key driver of sustainability management, including responses to nature-related issues. The committee is chaired by the President and includes the Executive Vice Presidents, Division CEOs, and relevant corporate officers, with four outside directors serving as advisors and the Chairman and full-time Audit & Supervisory Board Members serving as observers. The Sustainability Committee determines important sustainability-related policies, identifies social trends, and discusses and decides on Toyota Tsusho’s responses to them in annual meetings. Furthermore, the Sustainability Corporate Subcommittee, which convenes every two months and is composed of the heads of relevant corporate departments, discusses various issues at the general manager level to enable swift responses.

In addition, the status of compliance with amendments to laws and new requirements concerning nature-related issues is deliberated annually at the Safety and Environment Conference, and responses are confirmed. The representatives of the sales divisions and group companies who make up the members of the conference incorporate the details of these deliberations into our business activities.

For details on the supervisory framework and current practices, please refer to the “Sustainability Promotion Structure.”

＜Organizational chart＞

As we conduct business around the world, we consider respect for human rights based on international standards to be a fundamental foundation of our activities. We support the International Bill of Human Rights, which includes the Universal Declaration of Human Rights; the Guiding Principles on Business and Human Rights; and the ILO Declaration on Fundamental Principles and Rights at Work issued by the International Labour Organization (ILO), and we are committed to respecting human rights.

With regard to the rights of indigenous peoples, we recognize their unique cultures and histories in the countries and regions where they reside. Furthermore, we give due consideration to the rights of indigenous peoples as stipulated in the laws and regulations of those countries and regions, as well as in international norms such as the United Nations Declaration on the Rights of Indigenous Peoples.

Toyota Tsusho revised its Human Rights Policy and Behavioral Guidelines in March 2022 in response to their growing importance in society. Based on the revised policy, we assessed our human rights risks. Having identified high-risk domains, we have been conducting human rights due diligence by administering questionnaires and carrying out on-site investigations, among other measures, to mitigate these risks. In addition, with respect to human rights risks in the supply chain, we have been advancing human rights due diligence for suppliers. We analyze human rights risks from the three perspectives of business nature (business sector), location (country), and merchandise we handle, as we do for our consolidated subsidiaries, utilizing international indicators and tools. We will conduct questionnaires and on-site audits as necessary for suppliers that are identified as high risk. Furthermore, we have established a consultation desk for all stakeholders—including business partners, suppliers, local community residents, and employees of Toyota Tsusho and its domestic and overseas consolidated subsidiaries—through which we receive consultations and reports related to human rights and labor issues (grievance mechanism).　 Through these efforts, we will identify negative human rights impacts and work to prevent or mitigate them.

The Toyota Tsusho Group supports the Keidanren Initiative for Biodiversity Conservation and carries out a variety of activities in cooperation with local governments to help reduce biodiversity loss. In addition, in mining industry in which we conduct business, we conduct environmental impact assessments in the business planning stage and during the operation, in accordance with national and local laws where we conduct business as well as international arrangements, formulate plans for mine closures in the future, perform rehabilitation and take other measures as necessary, and work to minimize the impacts on local environments and society.

The Toyota Tsusho Group operates a wide variety of businesses—including manufacturing, distribution, sales, and operations—across approximately 130 countries and regions worldwide. In the fiscal year ended March 31, 2024, to gain a comprehensive understanding of the Group’s interfaces with nature across its businesses and sites, we undertook the Scoping Phase of the LEAP approach. By using the TNFD-recommended tool ENCORE^*4, we assessed dependencies and impacts in both the upstream of the value chain and direct operations.

Dependencies and Impacts of Each Directly Operated Business by Division / Unit

In the fiscal year ended March 31, 2025, we narrowed the scope to direct operations and conducted evaluations and analyses in line with the LEAP approach, narrowing down the businesses—taking into account the ENCORE assessment results and factors such as scale of revenue—to those considered priorities for evaluation and action for the Group, and identified seven businesses as the selected targets.

Criteria and results of business selection

Toyota Tsusho is committed to “passing on a better Earth to the children of the future” as its mission. To this end, the company is broadening its perspective from carbon neutrality (CN) to nature positive (NP), aiming to create more comprehensive environmental value.

This “CN&NP” initiative lies at the core of the Toyota Tsusho Group’s sustainable growth strategy and underpins all of its business activities. In particular, the circular economy (CE) businesses, including renewable energy and resource recycling businesses, in which the Group excels, are vital means of realizing CN&NP and serve as key sources of value creation. In its role as “the world’s leading circular economy provider,” the Group promotes co-creation with diverse stakeholders, including those in supply chains, consumers, and local communities. Through five Working Groups (5WGs) that integrate internal and external capabilities, the Group generates value from both environmental and economic perspectives, offering attractive growth opportunities to society.

Going forward, as a good corporate citizen, the Group will continue to advance CN, CE, and NP in an integrated manner, strive to resolve environmental issues, and contribute to the realization of a sustainable society, fulfilling its responsibility to pass on a better Earth to the children of the future.

To identify dependencies and impacts on nature, as well as related risks and opportunities in its business activities, the Toyota Tsusho Group has adopted the LEAP approach recommended by the TNFD.
In the fiscal year ended March 31, 2024, as part of the Scoping Phase, we assessed the significance of biodiversity and the state of physical water stress around major business sites, and evaluated dependencies and impacts on nature in the selected businesses. In the fiscal year ended March 31, 2025, based on the results of the Scoping Phase, we narrowed down the target businesses and conducted analyses under the LEAP approach for seven businesses.

The Toyota Tsusho Group is working to enhance the disclosure of indicators, including the use of quantitative KPIs for material issues related to sustainability, including nature-related challenges. With regard to the global core disclosure metrics defined by the TNFD, they are as follows.
Going forward, the Group will continue to expand disclosure of relevant indicators and enhance transparency around its targets and progress toward achieving them.

In conjunction with recent global economic growth, demand for bluefin tuna has been increasing rapidly, and overfishing resulted in bluefin being considered for inclusion on the Red List.

Toyota Tsusho partnered with Kinki University, which created the world's first successful complete bluefin tuna cultivation, to establish and operate Tuna Dream Goto, the world's first commercial complete bluefin tuna cultivation venture.

The business has acquired certification under the nursery stock certification program of the Seedlings Council for Sustainable Aquaculture (SCSA), a nonprofit organization.

The SCSA conducts on-site confirmations and peer viewings by experienced academics and obtains public comments on assessment reports to prepare a final report and make a determination whether certification can be granted.

With SCSA certification, Tuna Dream Goto can state to consumers that its fish are cultivated using artificial stocks in order to preserve natural fish (a natural resource). In addition, complete histories from parent to egg, fingerling, fry, and adult fish are maintained, making it possible to ensure traceability and safety right up to the products.

Toyota Tsusho has also acquired chain of custody (COC) certification from the SCSA as the distributor of Tuna Dream Goto Bluefin tuna.

Eurus Energy Holdings Corporation, a renewable energy power generation business in the Toyota Tsusho Group, conducts environmental assessments at the pre-project stage and selects sites for the installation of power generating facilities based on the assessment results and projected impact on biodiversity. Environmental protection measures have also been taken, including efforts to avoid bird strikes (birds colliding with windmills) based on expert advice (such as by increasing wind turbine visibility for birds), and transplanting of precious plants. Furthermore, following the start of operations, Eurus Energy Holdings conducts thorough post-operation surveys and environmental monitoring to confirm the validity of the environmental assessment results and verify the effectiveness of the environmental conservation measures.

As international concern about environmental conservation in the Amazon increases, to maintain and expand business, it is essential to avoid dealing in goods that are produced in conjunction with deforestation and other such practices.

The Toyota Tsusho Group conducts business in Brazil through NOVAAGRI INFRA-ESTRUTURA DE ARMAZENAGEM E ESCOAMENTO AGRÍCOLA S.A. (NovaAgri), which has developed grain infrastructure business including grain warehouses, railway shipment facilities, and export terminals in central and northeastern Brazil. The Moratoria da Soja is an initiative launched by industry associations and their member corporations to enable sustainable production of soybeans while preventing destruction of forests in Brazil by stopping trading from areas in which deforestation of the Amazon biome has taken place. In line with the Moratoria da Soja initiative, we check producer lists and the following standards and conduct business based on structures for suspending trade with applicable producers.