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Environmental Management

Risks and Opportunities

Environmental Management

Among environmental risks and opportunities, Daikin takes firm measures in dealing with climate change because it considers this to be the issue with the greatest impact on its management. In our main business of air conditioning, our products consume electricity during usage and the fluorocarbons used as refrigerants impact climate change. In responding to the risks that could arise, we make it our environmental policy to work toward achieving a low-carbon society by proliferating the use of our energy-efficient environmentally conscious products.

To understand and properly respond to risks and opportunities, we prioritize the ones that are periodically reported by our worldwide bases and make plans to deal with them. Each base implements these plans and reports on their progress to the Board of Directors. For example, governments are stepping up regulations on refrigerants with a high global warming potential, and this constitutes a regulatory risk that can dramatically affect Daikin's business. Refrigerants with a low global warming potential have properties such as flammability and toxicity, and since each country has differing safety regulations, we are formulating policies on safety standards that we implement in each country.

There are also physical risks; for example, a typhoon could cause flooding that inundates a Daikin factory and halts operation, or one of our parts suppliers could have operational problems and no longer be able to supply Daikin. The flooding that occurred in Thailand a few years ago provided us with information that we use to identify issues and measures that we can use in other regions where we do business around the world.

Sustainability

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