Sustainability for the Media Do GroupClimate Change Adaptation

Endorsement Announcement for TCFD^*1 Recommendations

The Company expressed support for the TCFD recommendations in June 2024 and joined the TCFD Consortium^*2. Starting in August 2024, we began disclosing information based on the TCFD framework. We will continue to enhance the content of our disclosures.

1. Governance

The Sustainability Promotion Committee will play a central role in promoting our response to climate change issues under the materiality “Preservation and optimal use of natural capital.” For more information on our sustainability promotion system, please refer to this page.

In disclosing information in line with TCFD recommendations, a project team led by the executive officer in charge of the materiality “Preservation and optimal use of natural capital.” has been established under the Sustainability Promotion Committee to collect information on the actual situation and discuss future initiatives.
In addition, to promote management that is integrated with ESG, the Company considers each individual's contribution to qualitative items, including ESG-related items, from the perspective of sustainable growth and medium- to long-term improvement of corporate value when allocating individual stock-based compensation to executive directors.

For details on executive compensation, please refer to Corporate Governance “Executive compensation”.

2. Strategy

For the fiscal year ended February 2024, we conducted a scenario analysis to understand the impact (risks and opportunities) on the Group and its businesses, assuming changes in the business environment caused by climate change. This analysis was based on energy consumption data from the Company, its co-located three subsidiaries, and MEDIA DO TECH TOKUSHIMA Co., Ltd., as well as information on locations of the Company and all consolidated subsidiaries. In analyzing scenarios, we evaluated the financial impact, focusing on the 1.5°C scenario, which is the target of the Paris Agreement, and the 4°C scenario, in which global warming progresses without countermeasures. As a result, while there could be significant business opportunities due to the growth of the eBook market, we calculated the financial impact in terms of increased operating and procurement costs and losses due to severe natural disasters.

Referenced Climate Change Scenarios and Evaluation Criteria^*3

	Transition Risk Risks associated with the transition to a decarbonized economy	Physical Risk Physical risks arising from climate change	Assumed Scenarios	Evaluation Criteria
1.5℃ Scenario	IEA WEO 2019 (SDS) IEA WEO 2023 (APS NZE)	IPCC AR5 (RCP2.6)	A scenario in which more stringent climate change measures than those currently in place would limit the increase in the Earth’s average temperature to 1.5°C to 2°C in 2100 compared to pre-industrial levels	Time Frame Short-term: Financial statement reporting period Medium-term: Up to 5 years Long-term: Over 5 years Impact Level Large: Operating profit of 5% or more (amounting to 100 million yen or more) Moderate: Operating profit of 1% or more but less than 5% (amounting to 20 million yen to 100 million yen) Minimal: Operating profit of less than 1% (amounting to less than 20 million yen)
4℃ Scenario	IEA WEO 2023 (STEPS)	IPCC AR5 (RCP8.5)	A scenario in which, without policies exceeding current warming measures, the Earth’s average temperature is expected to rise by approximately 4°C by 2100 compared to pre-industrial levels

Transition Risk
Risks associated with the transition to a decarbonized economy

Physical Risk
Physical risks arising from climate change

Assumed Scenarios

Evaluation Criteria

1.5℃
Scenario

IEA WEO 2019 (SDS)
IEA WEO 2023 (APS NZE)

IPCC AR5 (RCP2.6)

A scenario in which more stringent climate change measures than those currently in place would limit the increase in the Earth’s average temperature to 1.5°C to 2°C in 2100 compared to pre-industrial levels

Time Frame

Short-term: Financial statement reporting period
Medium-term: Up to 5 years
Long-term: Over 5 years

Impact Level

Large: Operating profit of 5% or more (amounting to 100 million yen or more)
Moderate: Operating profit of 1% or more but less than 5% (amounting to 20 million yen to 100 million yen)
Minimal: Operating profit of less than 1% (amounting to less than 20 million yen)

4℃
Scenario

IEA WEO 2023 (STEPS)

IPCC AR5 (RCP8.5)

A scenario in which, without policies exceeding current warming measures, the Earth’s average temperature is expected to rise by approximately 4°C by 2100 compared to pre-industrial levels

Risks and Opportunities for Business Activities

Risks		Concrete Example	Scenario		Time Line	Degree of Impact	Risk Avoidance/Reduction-focused Initiatives Conducted by the Group
Risks		Concrete Example	1.5℃	4℃	Time Line	Degree of Impact
Transition risks	Measures/regulations	Introduction of carbon tax and renewable energy policies: increase of business operating cost	✓ (-3.1 million yen)	✓ (+0.4 million yen)	Medium- to long-term	Minimal	Understanding of policy trends
	Market	Steep rise in wood prices: increase of procurement costs for paper products	✓	✓	Short- to long-term	Moderate	Periodic supplier reviews Understanding of demand for paper books, appropriate publishing/circulation management and cost control based on improved operational efficiency Leading of customers to eBooks
	Market	Steep rise in crude oil prices: increase of business operating costs	✓	✓	Long-term	Minimal	Monitoring of transportation-related costs and setting of reduction targets
Physical risks	Physical(Acute)	Increase of forest fires: increase of raw material costs incurred by print media due to reduced lumber resources		✓	Medium- to long-term	Moderate	Periodic supplier reviews Understanding of demand for paper books, appropriate publishing/circulation management and cost control based on improved operational efficiency Leading of customers to eBooks
	Physical(Acute)	Increase of natural disasters: human/physical losses and suspended operations due to damage to branches	✓ (-1.21 million yen)	✓ (-3.31 million yen)	Medium- to long-term	Minimal	Strengthening of BCPs
	Physical(Chronic)	Rise in average temperatures: increase of air conditioning costs	✓ (-0.1 million yen)	✓ (-0.1 million yen)	Medium- to long-term	Minimal	Monitoring of energy costs and setting of reduction targets Reduction of cooling load through heat-blocking and other measures

Opportunities		Concrete Example	Scenario		Time Line	Degree of Impact	Opportunity Acquisition-focused Initiatives Conducted by the Group
Opportunities		Concrete Example	1.5℃	4℃	Time Line	Degree of Impact
Transition Opportunities	Technology	Promotion of digital transformation: increased demand in digital content contributing to carbon reduction	✓		Long-term	Large	Achieve energy-saving capabilities and increased efficiency in developed systems Develop robust systems capable of addressing future increases in demand Improve brand value by appealing to environmental considerations
Transition Opportunities	Market	Increased demand in sustainable products: increased demand in paperless content	✓		Short- to long-term	Large
Physical Opportunities	Physical(Chronic)	Rise in average temperatures: increased demand in eBooks due to growing stay-at-home consumption		✓	Medium- to long-term	Moderate	Develop robust systems capable of addressing future increases in demand Improve brand value by appealing to environmental considerations

3. Risk Management

The Company has established “Risk Management Regulations” for the purpose of controlling the occurrence of risks and minimizing the company’s losses. Based on these regulations, the Sustainability Promotion Committee takes the lead in identifying, assessing, and taking countermeasures against risks that may affect sustainable growth and business activities, including climate change issues. The results of the risk assessment are reported to the Board of Directors, which determines the priority of risks to be addressed and directs the implementation of countermeasures after examining and considering the relative relevance of the risks from the management perspective.

For more details about Risk Management, please refer to this page.

4. Metrics and Targets

The Group calculates and discloses GHG emissions (Scope 1 and 2) as part of its efforts to reduce greenhouse gas emissions from business activities. We will continue to expand the calculation boundary to include our subsidiaries and Scope 3, while examining specific initiatives toward achieving our medium- to long-term targets.

Medium- to Long-Term Targets for GHG Emission Reductions

As medium- to long-term targets, the Group has set the following:

MEDIA DO Group GHG Emission Reduction Targets (Scope 1 and 2)

FY2030	50% reduction compared with FY2023
FY2050	Net-zero emissions

We recognize that engagement with suppliers will be essential in achieving these targets, and we are examining specific initiatives and the development of frameworks to support this effort. As a first step, we will work to calculate and disclose total GHG emissions including Scope 3.

GHG Emissions Results

Item	Category	Emissions(t-CO₂)
Item	Category	FY22/2	FY23/2	FY24/2	FY25/2
Scope1	Direct emissions from on-site fuel use and other company activities	5.5	5.0	4.2	4.0
Scope2 (location-based)	Indirect emissions from purchased electricity	132.9	145.5	169.2	158.1
Scope2 (market-based)	Indirect emissions from purchased electricity	135.9	152.9	153.6	162.5
Scope1+Scope2 (location-based)	−	138.3	150.5	173.4	162.1
Scope1+Scope2 (market-based)	−	141.4	157.9	157.8	166.4

Location-based: Calculated using average emission factors of the regions where target sites are located
Market-based: Calculated taking into account contracted electricity plans and renewable energy certificates

For all figures, please refer to ESG Highlights.

Task Force on Climate-related Financial Disclosures
The final report, published in 2017, recommends that companies disclose information related to climate change risks and opportunities in four areas: governance, strategy, risk management, and indicators and targets.
TCFD Consortium was established in May 2019 as a forum for companies and financial institutions that endorse the TCFD Recommendations to work together to promote initiatives, and to discuss effective corporate disclosure and initiatives to link disclosed information to appropriate investment decisions by financial institutions and others. After the dissolution of the TCFD in October 2023, membership in the Consortium will enable members to express their endorsement of the TCFD recommendations.
The numbers appearing in parentheses show the financial impact calculated.