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Sustainable environmental management indicators -Environmental Accounting FY2010-

Summary

The Ricoh Group disclosed its environmental accounting for the first time in 1999. Since then, the Group has introduced corporate environmental accounting to determine the status of sustainable environmental management and disclose related information, as well as segment environmental accounting, that is used to prepare environmental action plans, select measures, and verify achievements. Thus efforts are being made to establish environmental accounting as a tool for sustainable environmental management.

Corporate environmental accounting

The Ricoh Group calculates and announces the cost spent in its business activities for environmental conservation, as well as the conservation and economic effects, as quantitatively as possible. Such data is prepared in compliance with the Environmental Accounting Guidelines 2005—set by the Japanese Ministry of the Environment—by taking the necessary portion from the Eco Balance data and calculating the cost and effect (in quantity and monetary value) of the group's environmental conservation activities based on its own formulas and indicators. In fiscal 2007, the Group started disclosing its environmental impact from a product lifecycle perspective, in addition to direct environmental impact (i.e., environmental impact generated at business sites).

corporate environmental accounting in fiscal 2009

Segment environmental accounting

This is an environmental accounting tool to forecast the costs and environmental conservation/economic effects of individual investment activities and projects for environmental conservation from among all processes of operations and to evaluate their results, in order to judge the effectiveness of respective measures.

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Review of environmental accounting in fiscal 2010

Environmental accounting is designed to present the costs incurred for environmental conservation activities during a given period in comparison to the resulting environmental and economic benefits.
The scope of environmental accounting covers the entire product lifecycle, from the procuring of raw materials, the production and use of the products to recycling and final disposal.
In compiling environmental accounting data for fiscal 2010, part of the existing data collection processes pertaining to the recycling business outside of Japan and to environment-related labor costs in Japan were revised. The purpose of this revision was to remove redundant entries detected in certain data regarding the recycling business outside of Japan, and to include the part of environmental-related labor cost in Japan which was erroneously omitted in the previous process. As a result of the revision, the labor costs in question increased approximately 15%.
Other changes include the discontinuation of data collection of reduction effects in society's waste disposal cost reduction effects, which were included in the "social effect" category.
For fiscal 2010, the total environmental impact of the Ricoh Group showed a slight decline to 336,889 from 335,926 in fiscal 2009. However, our Eco Index for the fiscal 2010 saw a decline from the previous year because of the decrease in gross profit on sales affected by sluggish economies in and outside of Japan (see graph (2)).
The Ratio of Eco Profit and the Ratio of Eco Effect (an indicator that takes into account social cost reduction values) for fiscal 2010 also decreased from the previous year, mainly due to the increase in environmental conservation costs as a result of the aforementioned revision of environmental-related labor cost calculation (see graph (1)).
Meanwhile, recycling-related items, which make up the majority of costs and economic effects, showed relatively good progress during fiscal 2010, particularly in Japan, although our overall trend during the year was affected by the global economic downturn. We anticipate this upward trend of recycling-related items is likely to continue in the future.

  • *Graph (1) shows ratio of eco profit, ratio of eco effect, and ratio of eco effect of the entire product life cycle.
  • *Graph (2) shows eco index, gross profit on sales, and eco index of the entire product life cycle.
Changes in the Ricoh Group's sustainable environmental management indicators

(1) Ratio of eco profit and Ratio of eco effect

(2) Eco indicator

The Ricoh Group's sustainable environmental management indicators (fiscal 2010)
The Ricoh Group's sustainable environmental management indicators (fiscal 2010) Results in fiscal 2010 Calculation formula
REP : Ratio of Eco Profit 1.60 Total economic benefit (35.77) / Total environmental conservation cost (22.38)
REE : Ratio of Eco Effect 1.61 [Total economic benefit (35.77) + Social cost reduction values (-0.02 + 0.25)] / Total environmental conservation cost (22.38)
Eco Index
2,345.0 Gross profit on sales (790.0) / Total environmental impact (33,688.9) x 105
RPS : Ratio of Profit to Social cost 191.7 Gross profit on sales (790.0) / Total social cost (4.12)
  • *Unit: Billions of yen.
Sustainable environmental management indicators of the entire product lifecycle (fiscal 2010)
Sustainable environmental management indicators of the entire product lifecycle (fiscal 2010) Results in fiscal 2010 Calculation formula
REP : Ratio of Eco Profit 1.60 Total economic benefit (35.77) / Total environmental conservation cost (22.38)
REE : Ratio of Eco Effect 1.37 [Total economic benefit (35.77) + Social cost reduction values (-5.26 + 0.25)] / Total environmental conservation cost (22.38)
Eco Index 42.1 Gross profit on sales (790.0) / Total environmental impact (1,878,200.2) x 105
RPS : Ratio of Profit to Social cost 3.44 Gross profit on sales (790.0) / Total social cost (229.78)
  • *Unit: Billions of yen.

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An overview of our environmental accounting from FY 1998 to FY 2012

  • Indicators The Ricoh Group calculates environmental preservation costs and benefits based on calculation formulas and indicators developed by Group companies.

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