Supporting our clients’ net zero transformation efforts by helping them build new business models and disclose non-financial information, and becoming a net zero business ourselves.

PwC Japan Group

Outline

Our purpose at PwC is to build trust in society and solve important problems. To help combat climate change, one of the most pressing problems facing our world today, we have made a commitment to achieving net zero greenhouse gas (GHG) emissions by 2030 across the PwC global network.

In line with the Science Based Targets initiative, PwC is committed to reducing our total GHG emissions by at least 50% against a FY2019 baseline* by FY2030 and to neutralising our remaining emissions by actively investing in carbon removal projects to achieve net zero climate impact.

Based on this global network policy, the PwC Japan Group will also reduce our GHG emissions.

We will also support and encourage our main suppliers to tackle their climate impact and achieve net zero emissions. PwC Japan is continuing our commitment to our long-standing program of research and collaboration with businesses, policymakers and non-governmental organisations (NGOs) to accelerate the transition to a net zero economy.

In working with our clients, we encourage them to incorporate their decarbonisation initiatives and other non-financial disclosures in their corporate reporting. Another focus is to embed the implications of climate change and other environmental, social and governance (ESG) related factors into our client service practices and provide new solutions.

* This comparison is based on the Scope 1, 2 and 3 emissions calculated for FY2019. Note, however, that only emissions caused by business air travel were calculated for Scope 3.

Description

Efforts to reduce GHG emissions within the PwC Japan Group

As part of our efforts for reducing our own GHG emissions, we have committed to make thorough use of online meetings to decrease business air travel and to offset 100% of all remaining air travel emissions. Regarding electricity consumption in our office buildings, PwC Japan will procure electricity from renewable energy sources where possible, and in locations where procurement of renewable electricity is difficult, we will offset our emissions using the J-credit scheme. In addition, we will continue to implement a range of measures including fundamental operational improvements to boost energy efficiency in our offices.

Engaging suppliers

To reduce Scope 3 emissions, we will communicate with suppliers on our net zero initiatives to discuss and work toward ways to cooperate in reducing GHG emissions.

Policy proposals aimed at collective impact

The PwC Japan Group began engaging in public policy activities in autumn 2018. One of the areas that we are focusing on in these activities is energy and the environment. We collaborate with diverse stakeholders to facilitate the wider deployment of renewable energy, and propose solutions for collective impact by leveraging knowledge and insights we have gained from overseas cases.

Support for clients

Various international programs and initiatives are underway to fight climate change. These programs and initiatives require companies and organisations to drive decarbonization of their business operations through a cycle of planning, executing, and disclosing their management strategy and performance. PwC helps our clients to reduce their emissions through a wide range of services.

1. Management support for decarbonisation

In July 2020, PwC Japan established the Sustainability Center of Excellence (CoE) as a multidisciplinary team specialising in sustainability to comprehensively support clients in their transformation to sustainable management. This team accumulates information on the latest trends and knowledge related to sustainability, develops new tools and offers related support services.

In March 2021, PwC Japan launched our support service for net zero policy evaluation and roadmap development, a new service offering that provides clients aiming to achieve net zero emissions with advice on effective ways to reduce their GHG emissions. Using newly developed tools, this service offers financial impact analysis and simulation of the effects of GHG emission reduction for different climate scenarios to help identify the most economically rational and effective measures and build investment plans for achieving net zero.

The tools used in this service are designed to forecast the impact climate change risks will have on the financial performance of an organisation by 2050 for different climate scenarios, based on the organization’s financial and non-financial information, and to simulate the effects of GHG emission reduction (financial impact and amount of GHG reduction) depending on the combination of net-zero measures that are employed.

Our service offerings also include TCFD scenario analysis, which visualises how climate change transition risks (including the tightening of climate change policies and rapid shifts in investor and consumer preferences) will impact an organisation’s financial performance (profit and loss, financial status and cash flow) through specific drivers.

Figure: Overview of analysis provided as part of PwC’s support service to help our clients assess their net zero measures and formulate roadmaps

The PwC Japan Group is accelerating the development and provision of services designed to support net zero transformation by leveraging our expertise.

2. Support for the disclosure of non-financial information

In response to the increasing importance of an organisation’s ESG information, we will put more focus on helping our clients to incorporate non-financial information, including information related to climate change, in their corporate reporting. As disclosure standards have a significant impact on corporate ESG practices, we will also work with the global organisations that develop these standards to ensure that Japanese companies can continue to improve their corporate value and achieve sustainable growth.

3. Support for the creation of social value

In view of the need for cross-industry collaboration for the building of sustainable smart cities, we have begun to provide full-scale support for such projects, capitalising on our wealth of experience in corporate M&As and public-private initiatives in the area of social infrastructure.

4. Tax support

Carbon pricing has already been implemented in Europe, and is expected to have a major impact on the achievement of a carbon-neutral society. We will begin providing full-scale support to help companies and organisations respond to carbon pricing mechanisms.

Based on our wide-ranging experience providing processional services in the audit and assurance, consulting, deal advisory, tax and legal fields and our proven track record in supporting clients in diverse industries, the PwC Japan Group will devote ourselves thoroughly to contributing to the fight against climate change and other social issues.