Environment

Basic Policy

The Shimamura Group engages in environmentally-friendly business activities. These include the reduction of waste, consideration for the environment in product procurement and a reduction in CO2 emissions.

Implementation items

Continued efforts
Reduction of waste
Zero product disposal / Promote resource recycling
Climate change initiatives
Energy saving of air conditioners / Switch to LED lighting
Increasing the efficiency of logistics
New initiative
Reduction of waste
Promotion of complete recycling
Consideration for the environment in product procurement
Development and sale of environment-friendly products
Development and use of environment-friendly auxiliary materials
Climate change initiatives
Disclosures based on the TCFD recommendations
Promotion of environmental consciousness in stores and transfer centers

1 Reduction of waste

Zero product disposal

Our basic policy is to sell the very last article of clothing. We do not dispose of excess inventory (excluding defective products).

  • Buyer (Merchandise Department)
    It is very important to order the appropriate quantity to reduce excess inventory.
    Therefore, buyers responsible for the purchase of products analyze past records, forecast sales in the next season and then carefully calculate the purchase quantity required in the sales plan.
    Moreover, buyers reduce the order quantity at the beginning of the season and then place additional orders during the season depending on products. This prevents unsold products due to over-ordering. Additional orders during the season need to be processed in a short time. Therefore, the cooperation of suppliers is indispensable. Accordingly, this is a mechanism we have formed upon relationships of trust over a long time with our suppliers.
  • Controller (Merchandise Department)
    It is very important to keep the appropriate quantity and content of inventory in each store to reduce excess inventory.
    Therefore, controllers responsible for the inventory management of products analyze product trends at all stores every week, and then carefully manage the inventory quantity in each store required in the sale plan by transferring products (moving products between stores) or reducing prices as appropriate.
    In addition, we have established a standard for price reductions. Accordingly, controllers reduce prices at the timing required for each product. This means we do not excessively reduce prices like significantly slashing the price of all products at the end of the season (so-called bargain sales).

    See Inventory management

  • Supplier (manufacturers, trading companies, etc.)
    We do not unreasonably return products we have ordered from suppliers and complete the transaction. Thus, we implement complete purchasing from suppliers.
    Therefore, suppliers do not dispose of our surplus products (excluding defective products).
Promote resource recycling

The Shimamura Group has been proactively recycling resources since 2007. We use our own logistics to bring together recyclable resources (hangers, plastic bag, shopping bags, cardboard, and miscellaneous and used paper) generated in each store at transfer centers. Recycling operators then implement resource recycling.
Furthermore, we have been working on complete recycling in which we turn the hangers and plastic bag generated in-house into raw materials (pelletizing) at facilities we have designated in Japan and overseas and then reuse these materials in-house since May 2019. With this initiative, we are promoting a circular economy that is friendly on the global environment because it does not generate plastic waste.

  • Changes in the amount of recycling
    2019 2020 2021
    Total amount of recycling(t) 12,877 13,917 15,702
     Cardboard(t) 7,047 7,325 8,018
     Plastic bag(t)*Hangers and other plastic 4,346 4,585 5,632
     Miscellaneous and used paper(t) 1,483 2,007 2,051
  • Changes in resource recycling (hangers only)
    2019 2020 2021 2022
    (Plan)
    2023
    (Plan)
    Amount of hangers delivered(t)*Approximation 3,700 3,700 3,700 3,400 3,450
     Complete recycling volume(t) 212 551 1,316 1,600 2,100
     Complete recycling ratio(%) 5.7 14.6 35.6 47.1 60.8
Hanger
  • Hangers in our designated color (light gray)
    We collect designated color hangers at the time of payment after they have been used to display products in our stores. We bring them together at stores and transport them to transfer centers where they are compressed. They are then pelletized at recycling plants in Japan and overseas. After that, they are molded into hangers in China and elsewhere and delivered together with products. We then once again use them in stores in the Shimamura Group.
  • Hangers not in our designated color (light gray)
    We remove hangers (mainly black) used at the time of delivery when they arrive and collect them. We bring them together at stores and transport them to transfer centers where they are compressed. They are then recycled into reprocessed plastic products at recycling plants.
Plastic bag

We remove the plastic bag used to protect products at time of delivery when they arrive. We then sort it by materials in stores and recycle them.

  • Plastic bag made of colorless and transparent polypropylene (PP) materials
    Each store sends them to transfer centers where they are compressed. They are then pelletized at recycling plants in Japan and overseas. After that, they are molded into hangers, hooks and other products in China and delivered together with products. We then once again use them in stores in the Shimamura Group.
  • Plastic bag made of polyethylene (PE) materials and colored PP materials
    Each store sends them to transfer centers where they are compressed. They are then recycled into reprocessed plastic products, RPF (refuse derived paper and plastics densified fuel) and similar in recycling plants.
Shopping bags

We have been asking customers to bring used shopping bags to our stores and then collecting them for 1 yen per bag since April 2007. Each store sends used shopping bags to transfer centers where they are compressed. They are then recycled into reprocessed plastic products in recycling plants.
Our shopping bags are made with materials that contain at least 25% of plant-derived raw materials (biomass plastic). These are environmentally-friendly plastic shopping bags which comply with the Containers and Packaging Recycling Law to contribute to saving limited oil resources. (We have been using these in all our stores since July 1, 2020.)

Cardboard and miscellaneous and used paper

Each store sends the carboard used for delivery and the paper used for product protection to transfer centers. We then recycle them once again into cardboard and paper products at paper mills through waste paper collection operators.

2 Consideration for the environment in product procurement

Development and sale of environment-friendly products

We have defined products made with materials for which chemical substances are appropriately managed (e.g., organic cotton) and materials which save resources (e.g., recycled textiles) as "environment-friendly products." We are working to develop and sell these products to reduce our environmental burden in product procurement.
Environment-friendly products give safety and peace of mind to our customers by ensuring the traceability of suppliers of raw materials and production processes.

  • Examples of environment -friendly products
    Product name Main products Initiatives for environmental consciousness

    COTTON FROM USA

    T-shirt
    and sweat shirts
    We use sustainable raw cotton that improves yields while reducing the environmental burden.

    ORGANIC COTTON+

    T-shirt
    and sweat shirts
    We use raw cotton cultivated in environmentally-friendly soil. This reduces soil and water pollution.

    Suhada Suzuyaka Pants
    (Cool Pants on Skin) /
    Uraji Attaka Pants
    (Pants with Warm Lining)

    Pants These products are certified by STANDARD100 by OEKO-TEX®* to prove they do not contain harmful chemical substances. We use organic cotton and environmentally-friendly dyes and chemicals.
    *This is a sustainability certification organization for companies involved in the safety and production of harmful substances from raw materials to final products.

    LINEN+

    T-shirt We use Cool Max® Eco Made recycled polyester. This saves resources and reduces waste and CO2 emissions.

    Kokochi Labo(Comfort Fabric Series)

    Towels,
    duvet covers,
    pillowcases
    and sheets
    We use raw cotton cultivated in environmentally-friendly soil. This reduces soil and water pollution.

    REECOTTE

    T-shirt
    and sweat shirts
    We use recycled fabric made by re-spinning cut scraps that are generated during production.
Development and use of environment-friendly auxiliary materials

We are changing our delivery materials and auxiliary materials of products from plastic to paper. Moreover, we are working to reduce our environmental burden for materials that cannot be substituted with paper materials by recycling and reusing them as well as using reprocessed plastic that saves resources.

  • Examples of environment-friendly auxiliary materials
    Material Main auxiliary materials Initiatives for environmental consciousness

    FSC certified paper* and recycled paper

    Product tags
    and hooks
    We use environment-friendly paper materials. This reduces the amount of plastic.
    *This is a system to certify that timber is produced from appropriately-managed forests.

    Recycled polyester

    Woven labels,
    care labels
    tag pins
    We use recycled polyester made with used plastic bottles and other materials.

    Recycled polypropylene

    Hangers
    and hooks
    We collect the hangers removed at the time of payment, mold them into hangers, hooks and other products again, and then reuse them.

    See details of promotion of complete recycling.

3 Climate change initiatives (Disclosures based on the TCFD recommendations)

The Shimamura Group believes that responding to climate change is an important management issue. Accordingly, we are promoting our own reasonable initiatives to reduce greenhouse gases. We disclose those initiatives in line with the four disclosure items in the TCFD recommendations so that institutional investors who perform ESG investment can make appropriate investment decisions.
*The TCFD recommendations endorse disclosures in line with four information disclosure items: governance, strategy, risk management, and metrics and targets.

Governance
  • Role of the Board of Directors
    Our ESG policies are determined by the Board of Directors upon deliberations by the Management Plan Formulation Committee, which is an advisory body to the Board of Directors. We see ESG issues as management issues. Accordingly, the Management Plan Formulation Committee that discusses management plans also deliberates ESG issues. The Committee has a total of eight members who are all directors. The details and results of initiatives by each department and the ESG Promotion Team are reported to the Board of Directors or the Management Plan Formulation Committee at least twice a year.
  • Role of the Management Committee
    The policies determined by the Board of Directors are communicated to each department and are then incorporated into their respective policies. Moreover, the ESG Promotion Team, in which executive officers participate, deliberates on the policies that should be tackled across departments and then proceeds with them in cooperation with each department. The ESG Promotion Team holds a meeting basically once a month. The results are reported to the President by the Planning Section and it then receives instructions from the President as necessary.
  • ESG Promotion System
Strategy
  • Main risks and opportunities concerning climate change
    Climate change risks include transition risks brought about by changes in policies, laws and regulations and physical risks such as damage to property due to an increase in natural disasters. We evaluated the risks and opportunities we expect to face in relation to climate change in 2030. Upon that, we identified especially important risks and opportunities and then analyzed the level of impact they would have on our business. We will examine a quantitative evaluation of the business impact based on scenario analysis in the future.
Classification Important change Risk/Opportunity Details Level of impact
Transition Introduction of a carbon tax and greenhouse gas emission restrictions Risk Increase in the cost of product procurement and store/transfer center operation due to an increase in taxes and energy prices Medium
Risk Increase in product procurement costs due to the rising cost of raw materials because of laws and regulations Medium
Changes in consumer behavior Opportunity Increase in opportunities to sell environmentally-friendly products due to the heightened awareness of consumers toward sustainability Medium
Risk Loss of sales opportunities due to a lack of initiatives with respect to the heightened awareness of consumers toward sustainability Low
Physical Rise in average temperature Opportunity Decrease in store operation costs due to a reduction in the use of heating in stores Low
Risk Loss of sales opportunities due to the reduced purchasing motivation for winter products as summers become longer and winters become shorter Low
Risk Increase in store operation costs due to an increase in the use of cooling in stores Low
Increase in natural disasters caused by typhoons and heavy rains Risk Loss of sales opportunities due to a suspension of sales at stores in disaster-affected areas Medium
Risk Disruptions to the product supply structure due to a suspension of operations at transfer centers in disaster-affected areas Medium
Risk Increase in repair costs for stores and transfer centers due to damage to buildings in disaster-affected areas Medium
Risk Management
The Planning Section, which is responsible for corporate planning and ESG, holds discussions with the departments which may face future business risks and the ESG Promotion Team. Upon that, it grasps the situation relating to risks and opportunities and then reports on that to the Management Plan Formulation Committee. The selected policies to respond to important risks are deliberated by the Management Plan Formulation Committee and determined by the Board of Directors.
Metrics and Targets
We will consider evaluation indicators of climate change in the future. We are working to save energy and improve efficiency of logistics as measures against climate change. We disclose some of our greenhouse gas emission amounts.
  • Changes in the amount of greenhouse gas emissions
    FY 2013 2014 2015 2016 2017 2018 2019 2020
    SCOPE1(t-CO2 2,899 1,896 1,458 1,006 868 730 653 561
    SCOPE2(t-CO2 193,601 182,978 164,158 146,172 137,411 116,059 107,161 105,305
    (SCOPE)
    SCOPE1 : Kerosene, gas and other fuels for air conditioners, fuel for forklifts used at transfer centers
    SCOPE2 : Power for stores, transfer centers and the Head Office
  • Initiative for reduce CO2 emissions
    Energy saving of air conditioners

    The Shimamura Group is working to reduce power consumption and CO2 emissions by replacing conventional air conditioning equipment with high energy-saving air conditioning equipment when opening new stores or remodeling stores.

    Switch to LED lighting

    We are working to save energy (reduce CO2) by changing from conventional lighting to LED lighting. With the exception of some stores, the switch to LED lighting has been completed at stores and transfer centers.

    Increasing the efficiency of logistics

    At transfer centers, we have introduced a mechanism of "in-house joint delivery." In this mechanism, packages delivered from multiple suppliers are put on trucks chartered by the Shimamura Group, and are delivered to each store. In this way, we are working to increase the efficiency of truck delivery routes and to improve the loading rate. We started introducing EV trucks on some delivery routes to reduce CO2 emissions from 2022.
    We are also striving to reduce CO2 emissions throughout overall logistics in Japan by using "direct logistics," in which containers transported from overseas to Japan are delivered directly to our transfer centers without passing through the suppliers' distribution centers, and "modal shift," in which transportation between some transfer centers is switched from trucks to marine shipping or railroads.

    See Distribution

    Promotion of environmental consciousness in stores and transfer centers

    We will consider the introduction of energy-saving buildings and facilities to further reduce CO2 emissions from our stores and transfer centers.