In order to better incorporate ESG perspectives into management decisions and execution processes, in December 2021, Mercari established an ESG Committee to advise our Senior Executive Committee.
Mercari considers ESG and climate change to be important management topics. The ESG Committee aims to ensure sufficient time for regular discussions regarding ESG in order to enable better discussions and enhance the quality of decisions made by the Senior Executive Committee. We have also appointed officers for each of our material topics. Having these officers offer an ESG perspective in business-related management decisions allows us to plan each of Mercari’s business strategies in alignment with our material topics, and ensures a structure that allows us to swiftly implement and promote these initiatives. Our ESG officers also take part in discussions and decision-making for sustainability strategies across Mercari Group as members of the ESG Committee.
With Mercari Representative Director and CEO Shintaro Yamada as chairperson, the ESG Committee is composed of the CEOs of each Mercari Group company, as well as ESG officers and other members nominated by the chairperson. They meet four times per year to formulate ESG-related implementation plans and monitor progress on each of the material topics.
We conducted a scenario analysis to identify the climate-related transition risks, physical risks, and opportunities for Mercari Group as a whole.
In this analysis, we set two scenarios—a 1.5℃/2℃ scenario and 4℃ scenario—according to scientific bases provided by organizations like the Intergovernmental Panel on Climate Change (IPCC) and International Energy Agency (IEA). Looking ahead, we are examining how both Mercari Group and the society surrounding us will look in 2030 and beyond. Below are the main climate-related risks and opportunities we found based on the scenario analysis.
Impact of climate change on Mercari Group
Our plan of action
Data centers, etc., going down due to increasingly volatile natural disasters
If any data centers or power companies suffer damage from increasingly volatile natural disasters, it will cause the electricity and network to be suspended as well as data centers to go down, and our users will not be able to sell and buy things online
- Create a BCP to shorten the length of shutdown period
- Consider disaster recovery plans
Policy and Legal
Increase in item transport costs due to increased fuel prices following the introduction of carbon pricing
An increase in item transport costs due to increased fuel prices from the introduction of carbon pricing will impact our users (both sellers and buyers), and also impact the demand for items sold on our marketplace
- Work to strengthen supplier engagement
Damage to reputation among financial institutions/investors due to insufficient efforts to mitigate climate change
As there are increased demands from investors and financial institutions for information disclosure and actions to mitigate climate change, if companies fail to meet those demands, it will likely impact funding or cause a drop in stock prices
- Ensure complete and sufficient information disclosure
- Reduce 100% of scope 1+2 emissions by 2030
- Reduce emissions related to added value for scope 3 by 51.6% by 20301
Competitive advantage from changes in consumer preferences due to increased environmental awareness
We can increase the number of Mercari users in accordance with the spread of sustainable consumption and create new motives (contributing to the environment) for people to use Mercari
- Increase the number of Mercari users in accordance with the spread of sustainable consumption
Evaluation of business implications/financial impact
Mercari Group has conducted a scenario analysis to understand and assess the impact of climate change on our Group’s business and identify the different climate-related risks and opportunities. We are monitoring the identified risks and opportunities under our structure for promoting sustainability, which includes the ESG Committee. In this structure, there is also a process for reporting and making suggestions to the Board of Directors as necessary, depending on the project.
The Compliance and Risk Committee is also in charge of identifying and managing the key risks for the entire company. This committee takes into account the climate-related risks that may have a significant impact on the business, considers what issues should be handled, determines the priority, and puts together a response policy.
By 2030, we will aim to reduce 100% of scope 1+21,2 emissions compared to our benchmark year (FY2021.6), and reduce emissions related to added value for scope 33,4 by 51.6%.
Actual Amount of Emissions in FY2023.6 (July 2022–June 2023):
In FY2023, Mercari Group as a whole had about 43,000 tons of greenhouse gas emissions. Compared to our benchmark year (FY2021.6), we were able to reduce scope 1+2 emissions by 70% and the intensity of scope 3 emissions by 32%. We will continue to work on various initiatives to achieve our 2030 targets.
1. Scope 1: Direct emissions from fuel use by our company
2. Scope 2: Indirect emissions accompanying use of electricity/heat provided by another company
3. Scope 3: Supply chain emissions from company activities, excluding those covered in scope 1 and scope 2
4. Our targets fall under category 1, “purchased goods and services”