CSR Highlights in Pictures The Power of Forests for a...

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The Power of Forests for a Brighter Future CSR Highlights in Pictures The Sumitomo Forestry Group— developing businesses utilizing the potential of trees and wood, a renewable, natural resource. Just what value does this unique, vertically integrated business model, one that begins with planting trees and cultivating forests, offer to today’s society and the environment? Here, we introduce the new challenges Sumitomo Forestry has set itself. Special Feature 1 Special Feature 2 Special Feature 3 Special Feature 4 Special Feature 5 Special Feature 6 Special Feature 7 Special Feature 8 Special Feature 9 Project Earth Forestation Consulting to Support Social and Environmental Contributions Employing the Concept of “Looking at Forests from Space” “New Value” Being Created by Company-Owned Forests in Japan The Potential of Wood as an Energy Resource Working with Realities of Forest Depletion The Power of Forests to Protect and Nurture Life Expanding Use of Locally Grown Timber Taking Wooden House Construction Overseas The Power of Forests for a Brighter Future CSR Highlights in Pictures The Sumitomo Forestry Group— developing businesses utilizing the potential of trees and wood, a renewable, natural resource. Just what value does this unique, vertically integrated business model, one that begins with planting trees and cultivating forests, offer to today’s society and the environment? Here, we introduce the new challenges Sumitomo Forestry has set itself. Special Feature 1 Special Feature 2 Special Feature 3 Special Feature 4 Special Feature 5 Special Feature 6 Special Feature 7 Special Feature 8 Special Feature 9 Project Earth Forestation Consulting to Support Social and Environmental Contributions Employing the Concept of “Looking at Forests from Space” “New Value” Being Created by Company-Owned Forests in Japan The Potential of Wood as an Energy Resource Working with Realities of Forest Depletion The Power of Forests to Protect and Nurture Life Expanding Use of Locally Grown Timber Taking Wooden House Construction Overseas The Power of Forests for a Brighter Future CSR Highlights in Pictures The Sumitomo Forestry Group— developing businesses utilizing the potential of trees and wood, a renewable, natural resource. Just what value does this unique, vertically integrated business model, one that begins with planting trees and cultivating forests, offer to today’s society and the environment? Here, we introduce the new challenges Sumitomo Forestry has set itself. Special Feature 1 Special Feature 2 Special Feature 3 Special Feature 4 Special Feature 5 Special Feature 6 Special Feature 7 Special Feature 8 Special Feature 9 Project Earth Forestation Consulting to Support Social and Environmental Contributions Employing the Concept of “Looking at Forests from Space” “New Value” Being Created by Company-Owned Forests in Japan The Potential of Wood as an Energy Resource Working with Realities of Forest Depletion The Power of Forests to Protect and Nurture Life Expanding Use of Locally Grown Timber Taking Wooden House Construction Overseas

Transcript of CSR Highlights in Pictures The Power of Forests for a...

Page 1: CSR Highlights in Pictures The Power of Forests for a ...sfc.jp/english/csr/pdf/sfc_photo2011.pdf · Brighter Future CSR Highlights in Pictures The Sumitomo Forestry Group— developing

The Power of Forests for a Brighter Future

CSR Highlights in Pictures

The Sumitomo Forestry Group— developing businesses utilizing the potential of trees and wood, a renewable, natural resource. Just what value does this unique, vertically integrated business model, one that begins with planting trees and cultivating forests, offer to today’s society and the environment? Here, we introduce the new challenges Sumitomo Forestry has set itself.

Special Feature 1

Special Feature 2

Special Feature 3

Special Feature 4

Special Feature 5

Special Feature 6

Special Feature 7

Special Feature 8

Special Feature 9

Project Earth

Forestation Consulting to Support Social and Environmental Contributions

Employing the Concept of “Looking at Forests from Space”

“New Value” Being Created by Company-Owned Forests in Japan

The Potential of Wood as an Energy Resource

Working with Realities of Forest Depletion

The Power of Forests to Protect and Nurture Life

Expanding Use of Locally Grown Timber

Taking Wooden House Construction Overseas

The Power of Forests for a Brighter Future

CSR Highlights in Pictures

The Sumitomo Forestry Group— developing businesses utilizing the potential of trees and wood, a renewable, natural resource. Just what value does this unique, vertically integrated business model, one that begins with planting trees and cultivating forests, offer to today’s society and the environment? Here, we introduce the new challenges Sumitomo Forestry has set itself.

Special Feature 1

Special Feature 2

Special Feature 3

Special Feature 4

Special Feature 5

Special Feature 6

Special Feature 7

Special Feature 8

Special Feature 9

Project Earth

Forestation Consulting to Support Social and Environmental Contributions

Employing the Concept of “Looking at Forests from Space”

“New Value” Being Created by Company-Owned Forests in Japan

The Potential of Wood as an Energy Resource

Working with Realities of Forest Depletion

The Power of Forests to Protect and Nurture Life

Expanding Use of Locally Grown Timber

Taking Wooden House Construction Overseas

The Power of Forests for a Brighter Future

CSR Highlights in Pictures

The Sumitomo Forestry Group— developing businesses utilizing the potential of trees and wood, a renewable, natural resource. Just what value does this unique, vertically integrated business model, one that begins with planting trees and cultivating forests, offer to today’s society and the environment? Here, we introduce the new challenges Sumitomo Forestry has set itself.

Special Feature 1

Special Feature 2

Special Feature 3

Special Feature 4

Special Feature 5

Special Feature 6

Special Feature 7

Special Feature 8

Special Feature 9

Project Earth

Forestation Consulting to Support Social and Environmental Contributions

Employing the Concept of “Looking at Forests from Space”

“New Value” Being Created by Company-Owned Forests in Japan

The Potential of Wood as an Energy Resource

Working with Realities of Forest Depletion

The Power of Forests to Protect and Nurture Life

Expanding Use of Locally Grown Timber

Taking Wooden House Construction Overseas

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This project is only possible at Sumitomo Forestry because of our expertise in both forestry and housing. From the information about the state of cul-tivation of forests published on our website, we would like our customers to realize the importance of the envi-ronment. At the same time, we hope that the release of information about our contributions to the environment helps enhance our brand.

Offsetting CO2 emissions by increasing CO2 absorption by forests Sumitomo Forestry has been operating a carbon offsetting initiative as part of Project Earth since fiscal 2009.

We calculate that for every unit of housing produced by our custom-build and spec home businesses, after account-ing for logging and processing timber for principal struc-tural members, transport and construction work, a total of approximately six tons of CO2 is emitted. This means that with around 10,000 houses being built each year, an annual total of around 60,000 tons of CO2 is emitted.

In this project, we are aiming to offset these emissions

and industrial plantation projects in which trees are repeatedly harvested and replanted. We also aim to provide multifaceted solutions to issues from both an environmental and social per-spective. For instance, in the environmental plantations we monitor biodiversity while, in the industrial plantation regions, we create employment and help develop local economies.

To have people better understand the CO2-reducing effects of afforestation, we are actively disseminating information and looking at acquiring Clean Development Mechanism (CDM)1 certification from the UN. 1 CDM: A system under which developed countries support measures to reduce

emissions of greenhouse gases in developing countries. Upon acquiring certification as a CDM business, companies can use the achieved reductions as tradable “emission rights.”

by implementing planting efforts in Indonesia. This is a world first initiative for a housing builder.

Contributing to environmental conservation and local communities from a broad perspectiveTo offset 60,000 tons of CO2 emissions, it is necessary to plant an extensive area of around 300 hectares, twice the total floor area of the housing, and continually manage the plantation for 10 years.

In Indonesia, which is seeing increasingly serious degradation, we are implementing a five year plan that involves environmen-tal plantation projects, which are designed to help conserve the environment as opposed to plantations for harvesting,

T h e S u m i to m o Forestry Group has established a culture under which forests are not simply protected but maintained in a healthy state as they are utilized. The spread of this culture across the world is at the core of our overseas afforestation initiatives. We believe that our contribution to soci-ety should extend beyond just trans-ferring our expertise, to having people experience the wealth that the forest offers and become its guardians.

We want to let people know about our stance on the environment

Project EarthSumitomo Forestry’s initiatives for a low-carbon societySpecial

Feature 1

The system of carbon offsetting whereby CO2 and other greenhouse gas emissions are offset by renewable energies such as wind and solar power, or by tree-planting, is expanding worldwide. Against this backdrop, Sumitomo Forestry has conducted initiatives in which we utilize the expertise gained from the cultivation of forests in our Forestry and Environment business to offset the CO2 emissions from our housing construction.

Employee comments

We want to spread a culture of maintaining healthy forests

A representative fromthe Housing Division

A representative fromthe Forestry & Environment Division

* The background photograph is of a plantation forest in the Bromo Tengger Semeru National Park (Indonesia)

Absorb 60,000 tons of CO2

CO2 emissions per house forprincipal structural members

Approx.6 tons

Loggingand

transportConstruction

Timberprocessing

andtransport

Transportof

products

Precutting

CO2

CO2

CO2CO2 CO2CO2CO2

Indonesian forest

Annual CO2 emissions

Offset over 10 years

6 tons x 10,000 houses =

60,000 tons

Planting of 300 haof forest annually,

cultivation/managementfor 10 years

1 2

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Restoration and recovery of wildlife reserve Mitsui Sumitomo Insurance worked on reforestation in Indone-sia from 2005 to 2011.

Their efforts took six years, lasting until March 2011, and reforestation of approximately 300, 000 trees in roughly 350 hectares in Indonesia’s Paliyan Wildlife Sanctuary was com-pleted. Their objective was to restore and revitalize the forest, and also prevent or reduce the number of landslides and other natural disasters.

Sumitomo Forestry provided consultation for these efforts, from planning through to actual reforestation. In consideration of the local ecosystem, we selected indigenous tree species for planting. We also used agroforestry1 to help financially support local residents.

This reforestation project was a success, thanks partly to the great amount of cooperation we received from the Indonesian government and local residents. The planted trees are growing well, and wild monkeys are already returning to the forest.

Forests are an integral part of people’s lives in Indonesia. At Sumitomo Forestry, we are happy if we can lend a hand in local comprehensive forest management through the expertise we have accumulated.

Sustainable timber procurement and contributing to the local community and environmentRoland is a manufacturer of electronic musical instruments. They started their planting efforts in 2007 in Indonesia, from where they import cabinet components for their electric pianos.

They are working on both industrial and environmental plantation projects in their planting efforts, with consulting coming from Sumitomo Forestry.

The industrial afforestation project is designed to produce the raw materials for the cabinet components. Approximately 70 hectares have been reforested since January 2008, with logging scheduled to start in January 2012. The environmental affores-tation project involves reforesting a plot of approximately 30 hectares, and will not be logged as it is designated for environ-mental protection. Along with the trees, we are also contribut-ing to the local economy by cultivating fruit trees, vegetation for biomass fuel, medicinal herbs and other agricultural crops.

This project is a wonderful example of social contribution through business. Roland is plant-ing and growing the trees that will eventually be used as materials for their own products. The company also contributes to child education in Indonesia by donating some of their own instru-ments and other products to local elementary schools and other such efforts.

We would love to further expand the reach of these efforts.

Mitsui Sumitomo Insurance Company, LimitedCASE 1

Concluding the project successfully with cooperation from the local government and residents

Roland CorporationCASE 2

Contributing to the local economy and community through comprehensive forest management

Forestation Consulting to Support Social and Environmental Contributions

Utilizing forestation and forest management expertise cultivated over time Special Feature 2

In recent years, an increasing number of companies have been working on planting efforts as part of their CSR management plans. In these planting efforts, an understanding of the forest ecosystem, long-term forestry plan and specialist know-how are absolutely imperative. Sumitomo Forestry supports the CSR management of businesses in Japan and overseas through afforestation consultation, utilizing its diverse expertise in forest management.

Shuhei Nishi, Forestry & Environment Division Hirotaka Sato, Forestry & Environment Division

Employee comments Employee comments

3 �

1 A combination of reforestation and cultivating agricultural crops for short-term income, designed to improve the lives of residents while the trees are growing

Before reforestation (September 2005) After reforestation (October 2010) Before reforestation (September 2007) After reforestation (September 2009)

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1 This JAXA project posting system looks to create ground-breaking businesses using space and aviation through collaborations with industry, government and academia

2 Established in October 2003, integrating Japan’s Institute of Space and Astronautical Science, National Aerospace Laboratories and National Space Development Agency, JAXA undertakes aerospace research and development

Japanese offset credit system In an effort to popularize the idea of carbon offsetting in Japan as a method of making the country a low-carbon soci-ety, the Ministry of the Environment established the J-VER system for carbon offset credits in November 2008.

This system targets the energy conservation and forest management activities of companies and corporate groups, certifying as carbon offset credits the amount of CO2 and other greenhouse gas emissions they reduce and absorb. Certified carbon credits hold economic value and can be traded. This system results in the added advantage for busi-ness entities of allowing them to make a profit from reducing greenhouse gasses.

Focusing on forestation issues in developing countriesFor large-scale forestation, it is necessary to grasp the details of all related environmental data such as topography, vegetation, soil, climate, and land use. In developing countries where forests are dwindling and deteriorating, however, this information is not readily available. Acquiring up-to-date data requires considerable time and resources, making the implementation of forestation plans prohibitive in some cases.

To tackle this issue, Sumitomo Forestry obtains its environmental data for such regions using satel-lite information. We have invented a new plantation forest opera-tions business model which could also be useful in helping prevent global warming and protecting biodiversity. We were also selected to participate in the 2008 Space Open Laboratory,1 a project imple-mented by the Japanese Aerospace Exploration Agency (JAXA).2

Offset credits increase the profitability of forest managementIn January 2010, a 215-hectare forest in Miyazaki Prefecture owned by Sumitomo Forestry was certified as the first forestry project of the J-VER system. This forest is estimated to absorb approximately 2,000 tons of CO2 a year, which is issued to Sumitomo Forestry as a forest absorption offset credit.

Sumitomo Forestry believes that using offset credits will be a good business model for improving the profitability of forest management in Japan, and expects the system to help revitalize and promote further improvements in forest maintenance.

Investigating new forest management methods utilizing satellite dataSumitomo Forestry is currently working to verify the practical feasibility of this project model in Indonesia together with JAXA, the Hiroshima Institute of Technology and Kyoto University. Analyzing satellite images allows us to estimate the girth of individual tree trunks. We are also in the process of establishing methods to calcu-late tree height by comparing the satellite observation images with field study results.

From here on we will be verifying whether we can obtain large-scale data on soil and water systems. In the future, we are considering monitoring variables such as growth after forestation, CO2 absorption and sequestered carbon amounts.

Sumitomo Forestry is also using satellite photographs to classify tree species for company-owned forests in Japan.

Field survey in action

Satellite image EROS-B 2008/09/13© ISI 2008/HEEIC/HIT

“New Value” Being Created by Company-Owned Forests in Japan

Contributing to popularizing carbon offsetting in JapanSpecial Feature 4

At present, maintaining and managing forests requires significant expenditure in terms of labor and costs, and yet is still a low-profit business. With the enactment of the Kyoto Protocol, however, the potential of Japan’s forests is garnering much attention. This gives the CO2 absorbed by forests financial value—— Sumitomo Forestry is working to establish a new forest management business model and revitalize the forestry industry in conjunction with the Japanese Ministry of the Environment’s Japan Verified Emission Reduction (J-VER) system.1

1 The amount of emissions reduced is certified by an organization not recognized by the UN. According to the Kyoto Protocol, emissions reductions certified by the UN are called Certified Emission Reductions (CER).

Former seedling nurseryAcacia trees

50 m2 target measurement

area

Creating a new forestry business model using satellitesSpecial Feature 3

Having a good understanding of the expansive regional data for areas undergoing afforestation and forest management is essential. Sumitomo Forestry is garnering worldwide attention by developing a plantation forest operations business model drawing on cutting edge technology to obtain this data from space via satellites.

Sumitomo ForestryCompany-owned forest in Kyushu

Offsetting CreditJ-VER Certification

and Steering CommitteeCompanies and events

J-VER Certification

Approx. 2,000 tons/year ofabsorbed CO2 becomes credit

Credit provision

Paying for purchasing creditsCO2CO2 CO2

5 6

1 This JAXA project posting system looks to create ground-breaking businesses using space and aviation through collaborations with industry, government and academia

2 Established in October 2003, integrating Japan’s Institute of Space and Astronautical Science, National Aerospace Laboratories and National Space Development Agency, JAXA undertakes aerospace research and development

Focusing on forestation issues in developing countriesFor large-scale forestation, it is necessary to grasp the details of all related environmental data such as topography, vegetation, soil, climate, and land use. In developing countries where forests are dwindling and deteriorating, however, this information is not readily available. Acquiring up-to-date data requires considerable time and resources, making the implementation of forestation plans prohibitive in some cases.

To tackle this issue, Sumitomo Forestry obtains its environmental data for such regions using satel-lite information. We have invented a new plantation forest opera-tions business model which could also be useful in helping prevent global warming and protecting biodiversity. We were also selected to participate in the 2008 Space Open Laboratory,1 a project imple-mented by the Japanese Aerospace Exploration Agency (JAXA).2

Investigating new forest management methods utilizing satellite dataSumitomo Forestry is currently working to verify the practical feasibility of this project model in Indonesia together with JAXA, the Hiroshima Institute of Technology and Kyoto University. Analyzing satellite images allows us to estimate the girth of individual tree trunks. We are also in the process of establishing methods to calcu-late tree height by comparing the satellite observation images with field study results.

From here on we will be verifying whether we can obtain large-scale data on soil and water systems. In the future, we are considering monitoring variables such as growth after forestation, CO2 absorption and sequestered carbon amounts.

Sumitomo Forestry is also using satellite photographs to classify tree species for company-owned forests in Japan.

Field survey in action

Satellite image EROS-B 2008/09/13© ISI 2008/HEEIC/HIT

Employing the Concept of “Looking at Forests from Space”Employing the Concept of “Looking at Forests from Space”

Creating a new forestry business model using satellitesSpecial Feature 3

Having a good understanding of the expansive regional data for areas undergoing afforestation and forest management is essential. Sumitomo Forestry is garnering worldwide attention by developing a plantation forest operations business model drawing on cutting edge technology to obtain this data from space via satellites.

1 This JAXA project posting system looks to create ground-breaking businesses using space and aviation through collaborations with industry, government and academia

2 Established in October 2003, integrating Japan’s Institute of Space and Astronautical Science, National Aerospace Laboratories and National Space Development Agency, JAXA undertakes aerospace research and development

Focusing on forestation issues in developing countriesFor large-scale forestation, it is necessary to grasp the details of all related environmental data such as topography, vegetation, soil, climate, and land use. In developing countries where forests are dwindling and deteriorating, however, this information is not readily available. Acquiring up-to-date data requires considerable time and resources, making the implementation of forestation plans prohibitive in some cases.

To tackle this issue, Sumitomo Forestry obtains its environmental data for such regions using satel-lite information. We have invented a new plantation forest opera-tions business model which could also be useful in helping prevent global warming and protecting biodiversity. We were also selected to participate in the 2008 Space Open Laboratory,1 a project imple-mented by the Japanese Aerospace Exploration Agency (JAXA).2

Investigating new forest management methods utilizing satellite dataSumitomo Forestry is currently working to verify the practical feasibility of this project model in Indonesia together with JAXA, the Hiroshima Institute of Technology and Kyoto University. Analyzing satellite images allows us to estimate the girth of individual tree trunks. We are also in the process of establishing methods to calcu-late tree height by comparing the satellite observation images with field study results.

From here on we will be verifying whether we can obtain large-scale data on soil and water systems. In the future, we are considering monitoring variables such as growth after forestation, CO2 absorption and sequestered carbon amounts.

Sumitomo Forestry is also using satellite photographs to classify tree species for company-owned forests in Japan.

Field survey in action

Satellite image EROS-B 2008/09/13© ISI 2008/HEEIC/HIT

Employing the Concept of “Looking at Forests from Space”

Creating a new forestry business model using satellitesSpecial Feature 3

Having a good understanding of the expansive regional data for areas undergoing afforestation and forest management is essential. Sumitomo Forestry is garnering worldwide attention by developing a plantation forest operations business model drawing on cutting edge technology to obtain this data from space via satellites.

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Expanding demand for biomass-derived energy in order to more effectively utilize trees Since biomass power generation does not require a large initial investment, society holds high expectations for it as an easily introduced renewable energy source.

The CO2 generated by the combustion of biomass is offset by the absorption by plants in the growth stage, meaning that the overall amount of CO2 in the atmosphere does not increase (i.e., the process is carbon neutral).

Executive Board at the United Nations as the first Clean Development Mechanism (CDM)1 project in Indonesia utilizing wood biomass for power generation and 10,982 tons of Certi-fied Emission Reductions (CERs) for fiscal 2009 were issued in March of 2011. The CERs obtained from the project by Sumi-tomo Forestry are scheduled to be used to help group compa-nies reach targets for reductions in greenhouse gas emissions and to develop carbon-offset products.

Sumitomo Forestry is looking to utilize wood as an energy resource for biomass power generation. In the past, not all thin-nings and other similar material had been fully utilized. The new biomass power generation business means that such material will no longer be wasted. If the profits derived from such bio-mass power generation can be used to cover the costs of forest management, this will undoubtedly help revitalize the forestry industry. Moreover, the bark and offcuts that were formerly disposed of can also be utilized.

First wood biomass power generation in Indonesia begins operation PT. Rimba Partikel Indonesia (RPI) was established in Indonesia by Sumitomo Forestry in 1990 to manufacture particle board. Particle board is made from wood left over from logging and demolition waste, and therefore plays a useful role in enabling the effective use of forest resources.

RPI have now begun biomass power generation using offcuts and sawdust from surrounding saw mills. The generator, a wood biomass model with an output capacity of four mega-watts, is expected to reduce annual CO2 emissions by 15,000 tons compared to the diesel generator it replaces.

In May 2008, this initiative was certified by the CDM

Development of Kawasaki Biomass Power Generation Business Progress in the area of biomass power generation is also being made in Japan. In February 2011, Sumitomo Forestry started a biomass power generation business in Kawasaki, Kanagawa Prefecture, using demolition waste.

The company is the result of joint investment by Sumitomo Forestry, Sumitomo Joint Electric Power Co., Ltd., a member of the Sumitomo Group involved in power generation, and Fulu-hashi EPO Corporation, a company with experi-ence in the field of wood recycling.

The power plant has have a capacity of 33 megawatts, and supplies power to businesses and homes under a Power Producer and Supplier (PPS)2 arrangement. Kawasaki Biomass Electric Power Corporation

and Japan Bio Energy Corporation

RPI Biomass Power Plant

The Potential of Wood as an Energy Resource

Biomass power generation by effective use of waste construction materialsSpecial Feature 5

Biomass power generation makes use of renewable plant-derived material (biomass) to generate electricity. Sumitomo Forestry is committed to using wood, around which our businesses are centered, as an energy resource and pursuing new business prospects that contribute positively to the environment.

2 This refers to companies allowed to enter the market alongside regular power companies, which had previously held regional monopolies, as part of the power liberalization policy introduced under the revised Electricity Business Act of 1999

Power generation with wood biomass by RPI CASE 1

Alliance of three companies to establish biomass power company and wood chip supplierCASE 2

1 A system under which developed countries support measures to reduce emissions of greenhouse gases in developing countries and in exchange receive CERs, which can be used to help achieve emissions targets at home. It is one of the “flexible mechanisms” created under the Kyoto Protocol together with the International Emissions Trading (IET) and Joint Implementation (JI) schemes.

Wood chipspurchased

Waste constructionmaterials, etc.

ElectricityElec-

tricityElec-

tricity

Fuel chips supplied

Operation of Kawasaki Biomass Power Generation Business

PowerProducer

and Supplier(PPS)

Chipmanu-

facturingplant

Businesses,homes

Japan BioEnergy Co., Ltd.

Chip production

KawasakiBiomass Electric

Power Corporation

33 megawatts ofCO2-free electricity

Waste materials generatedduring construction, etc. arechipped to form a wood fuel

Biomass power generationusing wood chips

Plants Biomassfuel

Biomasspowerplant

CO2 absorbed asplants grow

Amount of CO2absorbed as plants grow

Amount of CO2emitted during biomass

power generation

A carbon neutral system

The amount of CO2in the atmosphere does

not increase

CO2

CO2

CO2CO2

CO2CO2 CO2

CO2

CO2

7 8

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Protecting, regenerating and appropriately maintaining our forests The unplanned overharvesting taking place in all parts of the world in recent times has exceeded the regenerative capacity of nature, resulting in the depletion of our forests. To protect against further destruction, it is necessary to prevent the dis-tribution of indiscriminately harvested timber.

Sumitomo Forestry has pledged, in the Timber Pro-curement Philosophy and Pol-icy introduced in June 2007, to only handle legally sound and sustainably produced timber. We have also established an action plan to implement this pol-icy and have been checking the legal compliance of all timber directly imported into Japan. In 2009, the checking was completed and it was confirmed that this tim-ber does not include any illegally logged timber.

In 2010, we formulated an action plan with targets to be achieved by the end of 2012. The plan calls for expanded handling of timber certified for legal compliance and sustainability, sustain-able plantation timber, and, to help revitalize the domestic forestry industry, Japanese timber.

Promoting the use of certified timber and plantation timber A number of third parties operate forest certification systems to verify that the forests are managed in a legally compliant and sustainable manner and that sufficient efforts are being made to preserve biodiversity.

Sumitomo Forestry employs these systems in its forest management. In 2006, we acquired Japan’s own Sustainable Green Ecosystem Council (SGEC)1 certification for all company-owned forests in Japan. In the same year, in an effort to increase the amount of certified timber sourced from sustainably managed forests, the Timber & Building Materials Division also acquired Forest Stewardship Council (FSCTM)2 certification, followed in 2008

by Chain-of-Custody (CoC)3 certification from the Programme for the

Endorsement of Forest Certification (PEFC).4

In fiscal 2009 we developed a new environmentally friendly

plywood called KIKORIN-PLYWOOD, made from at least 50% FSC and PEFC certified timber or 50% plantation timber from Indonesian and other countries. Before ship-ping, KIKORIN-PLYWOOD is branded with the

Kikorin logo as proof of quality and environmental

friendliness.

1 SGEC: An organization which operates a forest certification system that takes into consideration the climate and natural environment in Japan

2 FSC: Third-party organization which manages an international forest certification system

3 CoC: Certification for the management of procedures for processing and distribution

4 PEFC: A forest certification program which aims to promote sustainable forest management by endorsing third-party certifications

FSC certified timber

KIKORIN-PLYWOOD

PEFC/31-31-86

In recent years the forested areas of the world have been steadily declining: an area of 125 million hectares (around 3.3 times Japan’s land area) reportedly was lost in the 15-year period from 1990. At Sumitomo Forestry, to slow the depletion of forested areas and protect and cherish the world’s forests, we ensure that timber is procured from properly managed, sustainable forests.

Working with Realities of Forest Depletion

Insisting on procurement and use of timber from sustainable forests

Special Feature 6

Sumitomo Forestry utilizes timber from properly managed

forests to fulfill its responsibility to future generations

Source: Global Forest Resources Assessment 2005 issued by the Food and Agriculture Organization of the United Nations

4,200,000

4,000,000

3,800,000

0

(Unit: 1,000 ha)

1990 2000 2005

Trend in declining forested land worldwide

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Setting a Policy on Biodiversity PreservationAll of Sumitomo Forestry’s business is related in one way or another to forests, which a multitude of living creatures call home, and as such we recognize that our responsibility and impact on biodi-versity is larger than that of other companies. Losing biodiversity could also impact the trees and forests which form the basis of our business, so we see its preservation as essential.

We therefore established our Policy on Biodiversity Preservation for company-owned forests in Japan in September 2006, showing that we are striving to preserve biodiversity based on the Sumitomo Forestry philosophy of sustainable forestry from three aspects: ecosystem diversity, species diversity and genetic diversity.

Preserving biodiversity in company-owned forests Sumitomo Forestry has compiled a Red Data Book, which outlines rare flora and fauna that inhabit or might inhabit our four com-pany-owned forests in Japan. We have distributed this booklet to on-site forest management staff and workers, and are educating them on these rare species. In fiscal 2007, we also established the Riparian Forest Management Manual for preservation of forests adjacent to rivers and lakes.

Since fiscal 2008, we have been implementing biodiversity studies on wildlife living in our forests to gain a better understanding of their habitats and observe any changes over time.

Maintaining balance in the world’s ecosystems is an extremely important issue for humans, who exist thanks to the blessings of nature. In recent years, however, the loss of biodiversity has been becoming a serious environmental issue, as we are suddenly losing this balance. This is one reason why Sumitomo Forestry promotes conservation activities harnessing the power of forests to protect and nurture the diversity of life on our planet.

Kyushu

Fauna and flora inhabiting company-owned forests

Hokkaido

WakayamaShikoku

The Power of Forests to Protect and Nurture Life

Preserving biodiversitySpecial Feature 7

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Using Japanese timber in response to local demand In recent years, demand for locally grown timber in house construction has been increasing. This stems from the familiarity and peace of mind consumers feel when the posts and beams supporting their home are timber from their own local forests.

Active use of locally grown timber not only meets consumer requirements, but also helps vitalize the local forestry industry and preserve forests. It also cuts down transportation distances over materials procured outside the region, reducing CO2 emissions from transportation. Some local governments are subsidizing use of local materials to help promote these advantages.

At Sumitomo Forestry, we are encouraging use of Japanese tim-ber in wooden housing. We have already increased the Japanese tim-ber usage rate to 70%1 for principal structural members. We shall look at community needs and supply sys-tems and strive to further promote use of locally grown timber.

Expanding efforts in forested prefectures nationwide As an example of these efforts, the Sapporo Branch in Hokkaido, northern Japan, switched all their materials to Japanese larch (Larix leptolepis), Sakhalin fir (Abies sachalinensis) and other Hok-kaido-produced timber for custom homes sold from 2010. To ensure steady procurement of high-quality timber, the Sapporo Branch made efforts to build trustworthy partnerships, such as by providing Sumitomo Forestry’s expertise to local wood building materials manufacturers.

Much of the Hokkaido timber the Sapporo Branch purchases is harvested from forests that have been Sustainable Green Ecosystem Council (SGEC)2 certified, proving their envi-ronmentally friendly forest management. Housing that employs SGEC certified timber qualifies for certain local government incentives, meaning that our customers welcome this from an economic aspect as well.

We are also promoting similar initiatives in the Nagano, Nara, Wakayama, Aichi, Kochi, Yamaguchi, Oita, and Kumamoto prefectures, and we are working to use local materials in other prefectures as well.

2 An organization which operates a forest certification system that takes into consideration the climate and natural environment in Japan

1 Using Sumitomo Forestry’s primary construction method, the “Multi-Balance Construction Method”

Yamaguchi Prefecture is raising awareness of locally grown timber, and has been promoting preservation of local forests and revitaliza-tion of local forestry since 2005 with measures such as its introduction of the Yamaguchi Forest Development Prefectural Tax.

Among the different tree varieties in Yamaguchi, Obayashi Sangyo’s locally-grown Tokuji Hinoki Japanese cypress (Chamaecy-paris obtusa) has long been recognized as producing good tim-ber, but until recently most of the demand was from outside the prefecture.

So we worked to expand local demand by showcasing the special attributes of Tokuji Hinoki together with Sumitomo Forestry. With the help of Sumitomo Forestry’s wide-ranging businesses, we hope to see new demand beyond that of building materials.

Tokuji Hinoki timber is known for its connection with the priest Chogen, who reconstructed Nara’s Todai-ji temple in 1203. Chogen purchased some Tokuji Hinoki timber from Yamaguchi because of a local timber shortage at the time. From the wood he purchased, Chogen is said to have used Tokuji Hinoki to make wooden figures which have since be-come national treasures. We would like to increase demand and contrib-ute to the local economy by acquainting the local community with the special characteristics of Tokuji Hinoki material and its interesting past.

Takamitsu Takenaka, Sales Yamaguchi Office

Since my wife’s family home was made of wood, we were keen to build a wooden home ourselves. And we felt more comfortable using lo-cally grown timber rather than timber from somewhere else. Upon ap-proaching the construction site, we could smell the wonderful aroma of cypress in the air and were glad we had chosen Tokuji Hinoki.

Hiroshi Fujimoto (Client)

Expanding demand by branding local Tokuji Hinoki cypress trees

Initiatives in Yamaguchi Prefecture

Working together with local timber companies and other businesses is important in expanding use of locally grown timber. Masanobu Obayashi, Representative Director of Obayashi Sangyo, a company developing timber-related businesses, had this to say of our initiatives in Yamaguchi Prefecture:

Masanobu ObayashiRepresentative Director of Obayashi Sangyo Co., Ltd.

A brief word

Yasuhiko TsurusawaSumitomo Forestry Wood Products Co., Ltd.

The concept of local production for local consumption has expanded from these beginnings to include demand for local products in the housing field as well. Timber grown in local forests, used in local housing— local material use is expanding, centered on those regions with plentiful forest resources.

Expanding Use of Locally Grown Timber

A step forward in promoting use of Japanese timber

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New wooden houses built to last several generations Japanese houses are generally built to last about 30 years. This is perhaps the product of the many houses built around 1950 that gave precedence to quantity over quality.

In the current market, however, customer awareness of environmental measures and economic concerns has risen along with home-building technology. Customers are demand-ing longer-lasting homes which they can live in for several generations. In response to these societal demands, Sumitomo Forestry has independently developed a configuration charac-terized by strong joints between posts and beams, eliminating the need for a shear wall. This Big-Frame configuration also boasts excellent earthquake resistance and versatility.

Taking a Japanese first in technology to the European market The Big-Frame configuration’s development concept and our high technical capability have attracted attention in Europe. Over the course of two and a half years from 2007, we conducted joint research on new wood construction using the Big-Frame configuration with the SP Technical Research Institute of Sweden.

Like Japan, Sweden is launching national global warming countermeasures. As such, they are constructing condomini-ums for sale, large shopping centers, libraries and even airport control towers out of wood.

Traditional Swedish designs, however, were not very versatile, making it difficult to alter floor plans. Sweden has great expectations for Big-Frame configuration as a new method of wood construction that will solve these issues, and is already using it in construction of local student dormitories.

Sumitomo Forestry has independently developed its Big-Frame configuration, which is made up of large columns and beams for a strong structural framework. This eliminates the need for a shear wall while ensuring structural integrity and allow-ing great freedom in design. Sumitomo Forestry was the first in Japan to achieve this configuration in wood construction. Big-Frame configuration is possible because of quality timber, stable supply and more than anything, because we are the ones making it with our excellent technical capabilities.

What is Big-Frame configuration?

Japanese home constructed using Big-Frame configurationAbove— under constructionBelow— completed

Swedish dormitory constructed using Big-Frame configurationAbove— under constructionBelow— completed

In the search for longer-lasting homes that can be passed down to future generations, Sumitomo Forestry has developed a unique Big-Frame configuration using its expertise developed in building wooden housing. With its excellent earthquake resistance, free design and potential for easy renovation, the Big-Frame configuration is garnering attention not only in Japan, but also in Europe as a home design that can adapt to changes in your family configuration and lifestyle.

Taking Wooden House Construction Overseas

Big-Frame configurations contribute to the realization of a recycling-oriented society

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Drawing out the power of the forest, and using it to open up our future.That is the Sumitomo Forestry Group’s responsibility and pleasure.

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Drawing out the power of the forest, and using it to open up our future.That is the Sumitomo Forestry Group’s responsibility and pleasure.

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Drawing out the power of the forest, and using it to open up our future.That is the Sumitomo Forestry Group’s responsibility and pleasure.

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