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Hitachi, Ltd.

Hitachi's Approach for Biodiversity and E cosystem Service. 10 September 2012. Hitachi, Ltd. Environmental Strategy Office Senior Chief Engineer. Yoshiaki ICHIKAWA. Hitachi Business Portfolio. ( As of March, 2012 ). Power Systems . ICT Systems.

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Hitachi, Ltd.

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  1. Hitachi's Approach for Biodiversityand Ecosystem Service 10 September 2012 Hitachi, Ltd. Environmental Strategy OfficeSenior Chief Engineer Yoshiaki ICHIKAWA

  2. Hitachi Business Portfolio (As of March, 2012) Power Systems ICT Systems Social Infrastructure &Industrial Systems • 8% Others • 16% • 11% Electronic Systems & Equipment Financial Services • 9% Total118B US$ • 10% • 3% • 7% • 8% • 7% • 13% • 8% Digital Media & Consumer Products Construction Machinery High Functional Materials & Components Components & Devices Automotive Systems

  3. Hitachi Environmental Vision

  4. Ecosystem Corporations Ecosystem services Supply of raw materials (marine products, timber, etc.) and water Production Dependence Efforts for the preservation of ecosystems Contributions through businesses Contributions to ecosystems in product lifecycles Reduce Negative impact Reduction of environmental impact Contribution to ecosystems through products/services Expand Contribution of ecosystems Positive impact Social contribution activities for conservation of nature Promote Contribution of ecosystems Positive impact Relationship between Ecosystem &Corporate Activities Hitachi Group help ecosystem conservation through business and corporate citizenship activities while receiving benefits from ecosystem and giving impacts.

  5. Biodiversity/Ecosystem Tools and Concepts RCM*1 GDI (Finance mechanism) ● Economic WTP*2 ● PES*3 HEP＊4 LIME2＊5 Mitigation Hierarchy ● TMR Satellite (measure by image) No Net Loss Net Positive Impact Quantitative EP＊６ ● BBOP*10 FSC, MSC, RA (RainForest Alliance), Green procurement ABS*9 ● Mitigation Bank ● CEV*7 ESR*8 Qualitative Management & performance（KPI) Middlestream （B2B) Upstream （B2E*11) Downstream （B2C） ＊１Replacement Cost Method＊２Willing to Pay＊３Payment for Ecosystem Services ＊４Habitat Evaluation Process ＊５Life cycle Impact assessment Method based on Endpoint modeling ＊６Equator Principles＊７CorporateEcosystem Valuation *８Ecosystem Service Review *9Access and Benefit-Sharing *10 Business and Biodiversity Offsets Programme *11 Business to Earth

  6. Example of CEV (Corporate Ecosystem Valuation)

  7. Target Business Case: GeoMationFarm Scope: Application of GeoMation Farm, an agricultural information management system that improves efficiency of resource use and enhances crop productivity. The hypothetical studies are conducted, targeting the USA and France. (Note: This study is a high-level theoretical analysis based on publicly available data, and not based on empirical data taken from actual regions or the farms.) Current Situation: The demand and use of IT in agriculture, as well as the economic assessment of the benefits of agriculture (societal and environmental) is growing, but sometimesdifficult to implement, due to the difficulty in assessing the effects of the agricultural activities on ecosystems.

  8. A key Finding through CEV Step 5 of Stage 3: Relative magnitude value of directly affected ecosystem services & externalities, USA and France Key: Green shade = positive impact (i.e. benefit); Orange shade = negative impacts (i.e. cost) + = minor, ++ = moderate, +++ = major benefit (same scale for -, - -, - - - ) o = no/negligible impact Scenarios: Baseline: Condition at current state Business as Usual: Simulation if current practice continues for the next 25 years.Precision Agriculture: Simulation if PA is used in agricultural practice for the next 25 years.

  9. Industry Cooperative Work onManagement & performance (KPI)

  10. COCN: Council on Competitiveness -Nippon • Group of corporations and academic institutions aiming to improve Japanese industrial competitiveness through the cooperation with policy makers and other business organizations, and advocacy. • 32 companies, 4 universities, 1 research institute • Cross-sectoral

  11. Business and Biodiversity Study Group • 1. Background • The COP10 in Nagoya raised attention to business activities from the viewpoint of ecosystem conservation. • 2. Purpose • COCN started Business and Biodiversity Study Group in 2010 for 2 years-activity: • to study about what are the points to consider and what the companies can do for biodiversity • To develop a methodology • 3. Member • 2 construction companies, 1 developer, 1 bank • 4 electric/electronics, 1 material producer, 1 think-tank • 1 research institute, 1 university, 1 consultant • (coordinater: Hitachi, Ltd.)

  12. Business & Biodiversity Checklist • 1. Purpose for Assessment • To identify risks and opportunities • To improve activities through PDCA cycle • 2. Assessment Items • 6 stages of product or • service life cycle • 3 stages of • Land use • Conservation • Business opportunities • Each item has 5 stages (44 items)

  13. What We Check • Whether biodiversity or ecosystems are taken into account… • 1. Design • in the deliverables produced by the design process • 2. Procurement • when raw materials and parts (or equipment as components of services) to produce goods (or provide services) are purchased • 3. Manufacturing • for the production in its factories • 4. Transportation • when the company is the consigner (i.e., the actor who bears the shipping charge) • 5. Use and/or Operation • when products or services are used, operated, or maintained • 6. Disposal and Reuse • by promoting reduce, reuse, and recycle at the end of product life

  14. How to Improve Example: design stage definition: decide product or work specifications Check Result by radar chart Grasp points to improve Action Source: http://www.cocn.jp/common/pdf/thema45-L.pdf

  15. Result of Trial Manufacturers score high at production phase Manufacturing (Chemifal/Pharmaceutical) Manufacturing (Electric) Low at use phase Service Construction

  16. Foster ICT Applications through Ecosystem Conservation

  17. IT Eco Experimental Village Hitachi, Ltd. opened an IT eco experimental village in Hadano, Kanagawa Prefecture. The trials are underway to study the usefulness of IT for ecosystem preservation by conducting ecosystem preservation activities and monitoring. We are displaying the village’s temperatures and humidity on a website for the visualization of environmental information using sensors and cloud computing. Photographed inside the village Entrance to IT eco experimental village

  18. Thank you for your attention Dr. Yoshiaki Ichikawa E-mail: yoshiaki.ichikawa.rb@hitachi.com

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