[Governance]

Climate Change Initiatives and the TCFD

At the Mash Group, the Mash Holdings Sustainability Promotion Committee and the Management Strategy Meeting play a central role in implementing initiatives to combat climate change. Group companies promoting our businesses also participate in the Sustainability Promotion Committee, establishing a system that reflects perspectives on climate change in business strategies and promotions. We disclose the status of initiatives to combat climate change based on the recommendations of the TCFD using this system.

The Role of Management

The Representative Director and President of the Mash Group serves as the chair of the Sustainability Promotion Committee, leading the creation of basic policies on climate change measures and discussions on risks and opportunities. The Management Strategy Meeting is held once a month as well to discuss key issues such as budget allocation for climate change measures, issuing instructions within the company based on the results, and managing and promoting initiatives to achieve carbon neutrality.

Organizational Structure

At the Mash Group, the Sustainability Promotion Committee decides on basic policies for climate change measures under the supervision of the Management Strategy Meeting and manages risks and opportunities caused by climate change. Similarly, committees have also been established at three business entities, MASH Style Lab, MASH Beauty Lab, and MASH Food Lab, with one chairperson and one or two vice chairpersons appointed by the Management Strategy Meeting. Held once a month, the Management Strategy Meeting comprehensively discusses and decides on initiatives ① through ⑤ in consideration of basic policies and important matters related to climate change measures.

[Strategy]

In January 2022, Mash Holdings established the Sustainability Promotion Committee and launched Group-wide initiatives aimed at achieving both Japan’s national target of carbon neutrality by 2050 and the Mash Group’s own “Sustainability Goals for 2030.”

Based on the results of a scenario analysis, Mash Holdings recognizes that climate change may bring positive effects, such as increased support from environmentally conscious consumers. At the same time, it presents transition risks that could negatively affect corporate financial performance. These risks include higher CO₂ emissions costs due to the emissions trading scheme (GX-ETS) and carbon taxes, rising energy costs, surging raw material prices, and shifts in consumer preferences. Additionally, physical risks resulting from extreme weather events, such as increasingly severe natural disasters including storms and floods, are recognized as potential threats that may cause damage to stores, offices, and products, thereby negatively affecting corporate financial performance.

The Mash Group, based on the results of the scenario analysis, positions climate change initiatives as a priority issue. Moving forward, the Group will continue to proactively identify the specific risks and opportunities, and their business, strategic, and financial impacts according to the characteristics of each business and service, and will evaluate and implement necessary countermeasures.

[Risk Management]

Mash Holdings considers climate change a critical issue and has established a Governance Committee and Sustainability Promotion Committee that analyzes and manages risk factors in order to address business risks. The Sustainability Promotion Committee centrally identifies risks related to climate change, determines which risks to address based on their impact severity, and conducts monitoring once a year (as of February 2025).
The Mash Group conducts regular surveys and monitoring through its Mash Holdings Sustainability Promotion Committee to understand and assess the impact of climate change on the business as well as receive advice from external experts and identify climate change risks and opportunities.
Key risks and opportunities that have been identified are reported to the Management Strategy Meeting, under whose supervision the Mash Holdings Sustainability Promotion Committee works with relevant departments to implement specific risk measures.
Since risks may vary depending on environmental and social conditions, a review will be conducted once a year at a fixed time.

[Metrics and Targets]

Our climate change goal at the Mash Group is "achieving carbon neutrality." A goal has been set under the slogan “SUSTAINABLE & POSITIVE!” to achieve a 40% reduction in CO₂ emissions in Scopes 1 and 2 by 2030*.
(* The reduction is calculated based on CO₂ emissions per unit of revenue)

Specifically, initiatives are being implemented to reduce CO₂ emissions from electricity and energy consumption within offices by 40%. Furthermore, efforts are being made to visualize CO₂ reductions in the fashion business and to advance the transition to clean energy at cooperating factories.

At the same time, to promote “Wellness Design for People and Society,” a key goal across the Group, proactive steps are being taken in the fashion business to adopt environmentally friendly raw materials. Additionally, the beauty business is transitioning the packaging and labeling of private brand products to sustainable materials and improving the disclosure of environmental initiatives. Moreover, the food service business aims to achieve a 70% reduction in food loss and a 60% reduction in plastic usage.

Furthermore, the calculation of Scope 3 emissions for the entire Group began in FY2023. Moving forward, efforts will be made to strengthen collaboration with suppliers and promote reductions in Scope 3 CO₂ emissions.