Sustainability | Fujita Kanko Inc.

Compliance with TCFD

Disclosure based on TCFD
The World View Surrounding Our Group due to Climate Change
Scenario Analysis

Disclosure based on TCFD

Climate change is an important global social issue, and the movement toward the achievement of a carbon-free society is expanding globally. Fujita Kanko Group is aware that the risks and opportunities related to climate change are among the most important management issues. We will disclose information following the recommendations of TCFD as follows.

Note: TCFD (Task Force on Climate-related Financial Disclosures) ...Companies aim to promote information disclosure and dialog with investors, understanding that responding to climate change means long-term risk management and creation of opportunities

(1) Governance

Our Group has the Sustainability Promotion Committee as an advisory body to the Board of Directors. The Sustainability Promotion Committee was formed as a company-wide organization crossing the head office and business departments. It deliberates and examines priority sustainability-related issues, including climate change. Also, its contents are reported to the Board of Directors appropriately, which leads the Board of Directors to oversee climate change risks.

＜Link＞Corporate Governance
https://fujita-kanko.com/investor-relations/policies/corporate-governance/

(2) Strategy

As a result of conducting climate change scenario analyses and assessment of the importance of risks and opportunities that may affect our business activities, we identified the following three topics are important risks and opportunities that may have a significant influence on our business: 1.Soaring raw material prices due to the introduction of a carbon tax and rising temperatures, 2.Changes in customer behavior and consumer preferences, 3.The increase in the frequency of disasters and damage due to typhoons and heavy rains. We will take measures against these important risks and opportunities respectively to reduce the risks and secure opportunities with certainty.

(3) Risk Management

Our Group has the Risk Management Committee as an organization to provide guidance and advice. It comprehensively and sweepingly identifies and grasps company-wide risks, selects the departments responsible for each risk, and reduces risks by the responsible departments. The Risk Management Committee identifies and takes measures for the important management of our Group's risks, and also monitors and manages sustainability-related risks and measures that the Sustainability Promotion Committee deliberates and examines.

(4) Metrics and Targets

Our Group holds the following five items as priority sustainability-related issues: 1.Environmental Conservation, 2.Safety and security,3.Promotion of Diverse Talent,4.Participation and Contribution to Society, and 5.Compliance with Corporate Ethics. As a goal for 2025, we seek a 50% rate for eco-cleaning*, 50% reduction of specific plastic provision (compared with 2019), and as a goal for 2030, a reduction of t-CO2 levels per 1,000 ㎡ to 59.4t-CO2 (a reduction of 46% compared with 2013).

Goal for CO2 emissions

	FY 2024	FY 2028	FY 2030
Total CO2 emissions (t-CO2) by floor space (1000㎡)	81.4	71.7	59.4

*Eco-cleaning: We ask our guests who stay consecutive nights to cooperate with simple cleaning for conservation of the environment (We do not clean bathrooms, make beds, or change sheets).

＜Link＞Sustainability Basic Policy
https://fujita-kanko.com/sustainability/sdgs.html

The World View Surrounding Our Group due to Climate Change

Scenario Analysis

(1) Definition of the scenario groups

We understand the risks, opportunities, and influence that climate change poses to us based on the request of the TCFD recommendations, and conducted a scenario analysis for the purpose of the resilience of our strategy assuming a mid- to long-term world and the needs for further measures. In the scenario analysis, we summarized the influence on our Group and the measures referring to the two different worlds in the assumed scenarios based on several current scenarios published by the Intergovernmental Panel on Climate Change (IPCC): One is assumed to limit the increase in global average temperature since the pre-industrial revolution to less than two degrees Celsius, which is the goal of the Paris Agreement (less than 2 ℃ scenario), the other is assumed to further increase global greenhouse gas emissions without any introduction of new policies or institutions (4 ℃ scenario).

(2) Risk and Opportunity Topics and Business Influence

Note:＜Term＞Short-term: Within two years, Mid-term: to 2030, Long-term: 2050

Risk and Opportunity Topics			Term	Influence on our Group		Influence Degree	Responses
Category		Topic	Term	Influence on our Group		Influence Degree	Responses
Transition risk	Policy, legislation, and technology	Cost increases due to the introduction of a carbon tax	Mid- to long-term	Risk	・Cost increases due to the carbon tax applied to emissions from our business activities ・Increased costs from higher procurement prices for ingredients, guest supplies, and other materials as carbon taxes are passed on by suppliers	Large	・Sustainable Energy Use ・Review of procurement methods and price setting, including in product development
		Cost increase due to tighter regulations	Short- to long-term	Risk	・Cost increases from updating equipment to comply with regulations ・Cost increases from switching to alternative materials such as recycled plastics and biomass plastics under plastic resource circulation regulations	Medium	・Optimization of capital investment plans ・Sustainable Energy Use ・Installation of amenity stations
		Cost increase due to tighter regulations	Short- to long-term	Opportunity	Cost reductions in waste processing through promotion of recycling and food loss reduction initiatives	Medium	・Promotion of waste recycling ・Participation in food loss reduction campaigns
	Market and reputation	Changes in customer behavior and consumer preferences	Short- to long-term	Risk	・Customer attrition, decline in corporate image, and difficulties in talent recruitment due to insufficient efforts to address climate change ・Decline in sales due to higher consumer costs from rising fuel and transportation expenses, resulting in decreased demand for business trips, leisure travel, and reduced usage of premium accommodation facilities	Large	・ Appropriate disclosure on climate change initiatives via the corporate website and other channels ー・Introduction of sustainable energy 　・Implementation of eco-cleaning (promotion of simplified cleaning for consecutive-night guests) 　・Switch to environmentally friendly amenity products, etc. 　・Conservation of Company-Owned Land and Promotion of Natural Circulation
		Changes in customer behavior and consumer preferences	Short- to long-term	Opportunity	・Improved corporate reputation, brand value, and easier talent acquisition through proactive climate change initiatives and PR activities ・Increased sales by responding to growing demand for sustainable tourism and climate-conscious products	Large
		Changes in the investors’ evaluation	Short- to long-term	Risk	・In cases where our response to climate change is deemed insufficient, this may lead to a decline in corporate evaluation and difficulties in fundraising	Medium	・Appropriate information disclosure in corporate websites and IR materials ・Continued dialogue with investors and appropriate responses
		Changes in the investors’ evaluation	Short- to long-term	Opportunity	・Enhanced corporate reputation, higher stock price, and smoother access to funding achieved by advancing proactive climate change measures and IR activities	Medium
Physical risk	Urgent	The increase in the frequency of disasters and magnitude of the damage due to typhoons and heavy rains	Short- to long-term	Risk	・Increased costs and decreased sales due to damage to facilities and real estate, as well as business interruptions caused by physical damage and human harm ・Decreased sales due to opportunity losses from transportation infrastructure stoppages, power outages, or difficulties in procuring amenities and ingredients	Large	・Formulation of BCP (Business Continuity Plan) and strengthening of safety management and disaster prevention measures ・Introduction of safety confirmation systems ・Diversification of procurement sources ・Securing of emergency stockpiles
	Urgent		Short- to long-term	Opportunity	・Contribution to the local community by providing evacuation shelters and water supply spots during disasters, leading to improved corporate reputation	Medium
	Chronic	Rising temperatures	Short- to long-term	Risk	・Increased costs such as utility and facility management expenses ・Increased risk of health impacts on employees and customers ・Increased costs to respond to administrative restrictions on usage volumes due to power shortages ・Increased costs and procurement difficulties for ingredients due to droughts, ocean warming, etc., resulting in higher raw material prices ・Decreased sales due to reduced outings on days with extreme heat or midsummer heat	Large	・Sustainable Energy Use ・Promotion of energy saving ・Review of product development and sales strategies in line with demand
		Rising temperatures	Short- to long-term	Opportunity	・Enhanced customer evaluation through responses that consider rising summer temperatures, thereby demonstrating our proactive approach to climate change	Large
		Water shortage and drought	Long term	Risk	・Potential shrinkage or operational difficulties for the hot spring businesses and operations that utilize water resources ・Increased water rates and costs to respond to usage restrictions	Medium	・Promotion of Reduced Water Usage ・Effective utilization of water resources

(As of March 2026)

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