Accelerating toward a circular economy – from idea to action | #Nissan
Hello everyone thank you for joining us at Nissan’s Suitability Seminar 2023 Circular Economy My name is Ohara with Global Communications of Nissan Motor Corporation I have the pleasure of serving as your MC today the seminar is divided into two parts beginning with a presentation then panel discussion first
We will be inviting Chief Sustainability Officer of Nissan Motor Corporation Mr. Joji Tagawa to explain Nissan’s initiatives in the field of environment then we’ll be inviting experts to take part in the panel discussion entitled accelerating toward a circular economy from idea to action without further ado, I’d like to invite Mr. Tagawa
Mr. Tagawa the floor is yours Thank you everyone for joining Nissan’s annual Sustainability Seminar I’m Nissan’s Chief Sustainability Officer Joji Tagawa for our third annual session we will have two panel discussions each with a different theme the first is circular economy and the second is DEI: diversity equity
And inclusion before we begin our first panel discussion on circular economy I would like to introduce Nissan’s initiatives for sustainability and our plans for the future this year the world has encountered numerous weather anomalies such as record-breaking high temperatures extreme heat waves in regions never
Experienced before and recurring wildfires you have all no doubt felt this shift and change in environment as United Nations Secretary General Antonio Gutierrez recently summarized on the 27th of July the era of global warming has ended the era of global boiling has arrived there’s is
Growing evidence to suggest that 2023 could be the hottest year for Asia Europe and North America on record climate change will affect us significantly not only through its impact on the economy such as rising food and energy prices but by way of effects on individual health we live in
A world that requires immediate transformative actions to steer us toward achieving a more sustainable way of life to address this pressing crisis we must all contribute to the solution as a business person living in today’s world I feel responsible for the world we will leave behind to the next generation and
Also the generations that follow so when I became CSO I took on a personal mission to fulfill this responsibility motivated by our corporate purpose— Driving innovation to enrich people’s lives— Nissan has been putting sustainability at the heart of everything we do to ensure a cleaner
Safer and more inclusive world for all this sustainability seminar is a part of that initiative we want to discuss how we can achieve sustainability with experts and business leaders who are embarking on industry-leading initiatives the panel will share knowledge and
Experience that will inform what we can do today and how we can plan for a more sustainable future we accelerated our sustainability initiatives in 2018 with the Nissan Sustainability 2022 plan a five-year strategy that identified our targets in each aspect of ESG environmental social and governance since then we have
Reduced CO2 emissions from new cars by 41.2 percent compared to the fiscal year 2000 expanded introduction of renewable energy such as photovoltaic and wind power generation and increase the proportion of renewable energy consumption to 11.9 percent at our production plants since introducing the Nissan LEAF in December 2010 Nissan’s
Global sales of electric vehicles have surpassed 1 million units furthermore Nissan positions human rights as one of its most important material issues Nissan conducts human rights assessments as part of our due diligence and when evaluating Nissan and our partners globally in addition Nissan has consistently strengthened our initiatives for
Sustainability in various fields and have made steady progress last year we undertook a materiality assessment for the field of ESG identifying 21 items of materiality Nissan should prioritize and act on particularly to tackle climate change we are making electrification of our
Vehicles a top priority in our long-term vision— Nissan Ambition 2030— we have announced that we will introduce 27 new electrified models including 19 new EVs as we promote wider use of EVs Nissan has partnered with 4R Energy to establish a system to recycle resell refabricate and reuse EV batteries
Currently the batteries taken out from Nissan LEAF models are reused in various scenarios such as an emergency power source for railway crossings of East Japan Railway Company and power source for automated guided vehicles in factories we will further promote this circular system to greatly contribute to
Enhancing the use of renewable energy and reducing resource dependency Nissan has the goal to achieve carbon neutrality across the life cycle of its products by 2050 to reach net zero emissions we need to think about our manufacturing processes material resources and how vehicles are being used
As an example of reducing CO2 emissions of a product’s life cycle during manufacturing from January this year we’ve been using low CO2 steel and green aluminum from Kobe Steel for Nissan models with steel and aluminum taking up a significant percent of a vehicle’s
Materials the use of these materials is an effective way to reduce CO2 emissions during manufacturing in addition another important factor is the circular economy rather than procuring new resources by spending energy we intend to increase the value of resources and expand the utilization of products as an example of
Applying circular economy principles a closed loop recycling system for aluminum parts has been implemented in the following plants: Nissan Motor Kyushu Smyrna in North America and Sunderland in UK where X-Trail, Rogue and Qashqai are produced this system recycles aluminum scraps to create new
Alloy sheets for use in new vehicles aluminum recycling helps save more than 90 percent of energy needed to create a comparable amount from raw materials by expanding the use of recycled materials we plan to reduce the dependence on newly extracted resources and create synergy with climate measures these
Initiatives are also introduced in the ESG Data Book 2023 which was released at the end of July we also plan to publish Nissan’s first integrated report by the end of this fiscal year we will continue to utilize these tools with high transparency to disclose the status and results of our initiatives to
Our stakeholders in a timely manner Nissan plans to announce a new mid-term management plan this year and the basis of this plan would be the new sustainability strategy Nissan is currently formulating we believe that this new strategy is very important in realizing our long-term vision— Nissan
Ambition 2030— and will be announced at an appropriate timing this year Nissan will celebrate our 90th anniversary since being founded in 1933 Nissan has valued its spirit— Do what others don’t dare to do— we were among the first in the automotive industry to commercialize Lithium-ion batteries
And pioneered the era of mass-produced EVs by installing them on the Nissan LEAF currently we are developing all- solid-state batteries which will be a game changer for EVs we are also promoting cutting-edge efforts to become carbon neutral at our production plants however not everything can be achieved
By Nissan alone we want to create a sustainable future together with our various partners across industries for today’s panel discussion we have gathered panelists with extensive expertise and a wealth of experience from a wide range of industries I will also be participating as a panelist and
I cannot be more excited about our upcoming discussions so without further ado let us begin the conversations thank you thank you very much Mr. Tagawa for that presentation we would like to go on to the panel discussion I will first introduce each of the panelists one by one
Miss Takako Sato, Circular Economy Expert ESG Strategy Division of Ricoh Mr. Robert Metzke, Chief of Staff Innovation and Strategy, Head of Sustainability at Royal Philips Miss Pia Heidenmark Cook, Senior Advisor at Teneo and from Nissan Motor Company Mr. Joji Tagawa
Our moderator will be Mr. Keisuke Hanyuda who is the Managing Director and CEO of Owls Consulting Group I will hand over to Mr. Hanyuda please hello everyone we will now have a panel discussion on the theme accelerating toward a circular economy from idea to action I hope you enjoy
Again to introduce myself I am the Managing Director and CEO of Owls Consulting my name is Hanyuda Keisuke and I’ll be serving as your MC I’m a business consultant I’m also an advisor to the government I’m also involved in NPO/NGO activities and from various positions I’m engaged in sustainability society building
The theme today is circular economy the society has been based on mass production mass consumption and mass disposal so far in the area of linear economy there was too much load on the resource and environment and we became concerned that we will go
Beyond a planetary boundary the linear economy is a model that eats up resources and therefore it also undermines the potential economic growth but actually we knew about it, human society knew about it it’s not something new and yet we were unable to get rid of such habits, but
With progress in digital technology we finally are able to talk about the specifics of the new social economic system finally and much attention is being paid to circular economy which is the theme of today’s panel discussion we have four wonderful panelists who are pioneers in this area
They will give us tips on the importance of implementing circular economy they’ve been front runners and therefore they probably faced difficulties so those are some of the questions I wish to ask them we have a truly heavy-weighted panel so let’s ask them to once again self-introduce themselves could you
Mention your name and how you are currently involved in sustainability so in the order that you were introduced by the MC let’s start from Miss Sato of Ricoh please go ahead thank you good afternoon my name is Sato from Ricoh
Thank you for your kind invitation to take part in this wonderful seminar today I’m very grateful for the invitation I’m with the ESG division within the ESG Center so today I have brought with me a slide about our ESG Center so allow me to explain based on this slide the ESG Center
Is there to promote global activities throughout the Ricoh Group on a global scale we work with management strategies we also set ESG targets and also manage the progress and we also promote various activities at different business units and also we disclose ESG-related
Information we also gain outside assessment and also we carry out employee training we also are responsible for CSR promotion as well now my job title is circular economy expert So I’m responsible for promoting circular economy in that capacity I’m most focused on the following it is important that we develop environmentally friendly products
Is very important for us so we need to identify the needs and the requirements of our customers we also need to have advanced views of the regulatory requirement so that so this can translate into promotion of competitive products furthermore as far as our relationship with Nissan is concerned
They use a lot of our products and printers indeed circular economy which is the topic of the day they’re using renewable printers and also with regard to sales and marketing vehicles are essential so Nissan EVs and vehicles we use them to sell and market
Our products and as far as our scope of products our activities are concerned 40 percent is in relation to CO2 emissions it’s important that we eliminate that we need to make a transition to EVs this is essential so that being the case
Going forward we like to work together with Nissan thank you very much for this opportunity Thank you Miss Sato next I’d like to invite Robert can you say your name and also talk about your activities in relation to sustainability thank you thank you good afternoon it’s a great
Pleasure and honor to be with you my name is Robert Metzke, I’m Head of Sustainability at Philips I’m Senior Vice President and have a background in physics and I forward many different positions and innovation strategy in our company now you may know Philips is one of the leading healthcare technology providers in
The world and the healthcare industry in itself is very polluting and not accessible to half of mankind so as part of our purpose to improve three and a half billion people’s lives by 2030 we really believe that we can make a difference in working with hospitals around the globe to make healthcare both
Accessible and much more sustainable today the healthcare industry is emitting more CO2 than aviation and shipping lines together we have been the first health technology company in the world to have been adopting science-based targets for scope one two and three since 2000 we
Operate carbon neutrally globally last year 18 percent of our revenue came from circular solutions and products that will be close to 25 percent by the end of 2025 so we believe very much that circularity is one of the key methods to also reduce the global carbon emissions and indeed to operate
Within the planetary binary conditions Thank you, next I would like to invite Pia to take the floor hello good afternoon really happy to be here my name is Pia Heidenmark Cook I’m a Senior Advisor at Teneo I used to be Chief Sustainability Officer at IKEA and since leaving IKEA two years ago I
Sit on the board of directors of companies across healthcare retail restaurants and sustainable materials across North America and Europe and I worked with IKEA on circularity where we tested circular hubs in all our stores which was innovation or design center for
Customers to learn about circularity and how to take care of products and extend the life of products we had take back services so people could take back their old furniture and we were also testing second-hand sales both online and in the stores and also had of course a democratic design which was
An important part where we included sustainability and circularity at the beginning of the process when we designed the products and also working now at Decathlon which is a sports retailer where there’s also a lot of take back encouraging take back of sports articles and also a lot
Of second-hand products being sold so I continue to work with circularity also since leaving IKEA thank you thank you very much then let us begin the panel discussion Mr. Tagawa you’ve already spoken so I think introduction of Mr. Tagawa is not necessary
So the first topic is why circular economy why is circular economy very important I think we need to go back to this point why is circular economy so important those of you who are joining us in this discussion you may feel that the challenge to
Circular economy you might be questioning whether or not this is really important whether or not this is really viable I’m sure you have questions about the probability of circular economy not all of you are properly convinced about the viability of circular economy why is this
Necessary so that’s what we want to start with at this panel discussion so Pia I’d like to begin with the question to you Pia you also in your self-introduction you mentioned that you were with IKEA until two years ago and initiatives towards circularity
Developed circular business models including the take back offers so you’re one of the companies that was first very aware of the importance of circularity so you focused on circularity in the beginning but what what kind of sense of urgency and awareness of issues do you have
What caused you to focus on circularity ahead of the others I would appreciate your comments on this point thank you thank you yes I think one of the main reasons why IKEA was early was because we set climate targets very early and circularity is one key way of achieving
Your carbon goals or your climate goals and that is especially for producing companies like IKEA being a large home furnishing retailer where about 70 percent of the carbon footprint comes from the material and the production of the products so without really reflecting on how you design how you use the products
And how you take them back and how you recycle at the end we could not achieve our carbon goals and our climate goals so I think that was one of the main drivers understanding that 70 percent of the footprint actually came from the supply chain and the products so that was the first
Reason the second being a European or Swedish-based company there’s been a lot of legislation in the area I mean even more now today but also five seven years doing more circular activities in the company and then the third one is that a lot of our customers especially in
Belgium and Netherlands where we started a lot of the initiatives there was a big demand from customers where they wanted second-hand products they wanted to be able to return the products one of the biggest obstacles to buying a new
Mattress for example was not knowing what to do with the old one so also from a pure commercial point of view we could see that offering take back services made sense and then of course from a sustainability point of view it made a
Lot of sense because you want to make sure that the products live as long as possible to reduce the footprint per product so there were mainly three reasons one was materiality understanding the importance of circularity to achieve our sustainability goals second legislation existing but also coming legislation and third customer demands thank you
Thank you very much that was very straightforward and very clear thank you so much I would like to ask Pia further so you said there are various reasons for example regulations customer demands were you able to gain understanding internally how did you convince people internally for your
People inside the company I’m sure they resisted this plan how did you convince people inside the company we’re able to gain understanding at a very early stage thank you I mean it’s an ongoing journey I mean I’ve been I haven’t been in IKEA for
Two years now but I know that they’re still working on developing new circular offers and new circular solutions and I think it’s the same in every company that sustainability is an ongoing journey where you learn and it’s about change management and one of the key drivers in change management is of
Course education and awareness understanding why you need to change and what the journey and the roadmap in that change looks like so education awareness is a key another key part is success so doing initiatives doing activities or projects and proving that they actually work
And not only the small ones but of course a lot of small projects so that you can fail fast and fail not too costly but also bigger ones and and with time when you see that customers wanted employees are really proud you see that the payback is actually not so bad that
You maybe thought from the beginning then you start to see that this actually makes sense to do and then it becomes much easier to do the bigger projects that are more extensive but I would still say that it’s an ongoing journey uh within IKEA and within most of the companies where I
Work because it is a new business model it’s a new way of making money and and a new way of interacting with customers or interacting with suppliers if you look more at the design and product design phase so it’s not an
Easy quick fix but it is a fundamental change in looking at how we organize our biggest business and how we do business Thank you so much some encouragement that this is an on-going journey even for leading companies I like to ask Miss Sato now you have already tackled challenges
And Ricoh is very advanced And you have experiences working with investors, not just stakeholders What are some of the challenges that stakeholders share can you follow some challenges Pia talked about based on your engagement with different stakeholders what are your thoughts okay thank you let me focus on why circular economy
I have a slide about the ESG management targets from fiscal 2020 let me talk about this so how do we speak how do we address this from a circularity point circle economy from the short-term may seem as the cost increasing element and of course over the medium-
To long-term this should be seen as an advanced investment to gauge and to secure long-term profitability so we call this as future finances companies need to see requirements for circularity as a business opportunity so it’s important that we translate this into opportunity to gain positive impact on financial
Performance in three to ten years time and also as far as your business is concerned we are involved in B2B namely business to business that is the bulk of our transactions so when it comes to government procurement and transactions with various large companies we
Need to we need to address sustainability at an early phase and we find that these standards that are being required are becoming higher so it’s not just about economy we also have to address societies as part of ESG so the requirements are becoming much more complicated these days
So unless you address these issues early on then our products will not be chosen by customers so yes we’re talking about opportunity as well as crisis so it’s important that we take action now that is important that is the message we sent to our stakeholders
When we announced our and published our CE report because we were very rare as a company and also circular economy has become very popular only after the term decarbonization and many companies many people in the municipalities and companies have said that they hear the term circular economies but they don’t
Know what to do we receive correspondence from various people in many different municipalities and companies there are no goals set for decarbonization many people in these companies and municipalities don’t know what indicators they should follow they don’t know what to do
Also this was covered by Pia earlier if we persist there’s a there’s also a sense of resistance internally because there’s the issue of increasing costs and its compatibility with academic rationality so how did Ricoh pursue this these are some difficult questions from our stakeholders So with this background
Area we respond to various issues as we covered in our circular economy report now please take a look at this this goes back to 1994 and Ricoh established a concept called Comet Circle as a concept of realizing circle economy the circle shows partners to realize the circular economy
And the arrows show the process and because this looks like a comment that is a referred we use the term Comet Circle so from the top circle these are new materials that are started from the earth you go through the upper arrow and then convey to
Customers as a product we have during the mass production mass conception era the finished products and wastes are now follow the arrow on the bottom and they are putting inside landfills but now these days we have a lot of lease
Products so these products come back to us so optimal processing of products that are returned to us is required but should we continue should we really avoid recycling of products so 30 years ago very early on we faced this question we want to make sure that we could use
The arrow on the top to be able to recycle the product productive products if they cannot be recycled as products we should recycle them as parts they cannot be recycled and reuse the sports that they should be reused as materials so this is the circle which we have been function which
We have been operating very early on I say thank you very much when we take a look at the materials we would need to do decarbonation circular economy I think you talk about the relevance of disclosure to actually show that you’re committed so everybody says that this is a very
Sincere effort on your part to disclose your activities next I’d like to ask Robert earlier you mentioned that Philips is indeed is committed to circular business you have many products that contribute to this 18 percent of the products contribute to this you want to improve this up to 25 percent by
2025 so in your core business your various initiatives are related to sustainability so my so what I want to ask is your business units the equipment the very intense commitment on the part of the business units at Philips seems to be strongly committed to this
This is the question similar to the question that I asked earlier to panelists how did you convince the business units to be committed to products that lead to circular economy With increased rate of circular products How did they accept to a circular
Economy for each business unit how did you convince each of them thank you thank you for your question maybe Pia and previous panelists have already commented on the various stakeholder perspectives in a very comprehensive way I think if you want to help people to change the way they do business or how they
Look at their responsibilities it really starts with understanding why so and as Pia already pointed out the customers are changing their requests the regulators are stepping up there’s an increasing pressure to disclose things but most fundamentally I think is also to understand it makes business sense
There’s a logic I would argue circularity environments are a precondition for any successful business business cannot be successful if society failures if our environmental conditions collapse and we know that we have been digging up more than 100 gigatons of raw materials as mankind
Per year in the last years and with an increasing rate and less than 10 percent of them is recycles so we are running out as mankind out on a lot of critical materials so if you want to be successful as any business you need to find ways to create value for your customers
With less waste and less materials and I think that is a very strong logic and on that basis we engage with our business leaders and with some strategies to say okay how can we achieve that on the slide that you see here on the side I think is a couple of building
Elements that we use in our circular efforts so of course it starts with understanding do we need material at all what can we digitalize how can we provide services without materials the second element is if we use materials how can we move away from virtual materials and use recycled materials or
Materials that are much easier to bring in these recycling loops and there are some great examples from IKEA from Nissan and also from Ricoh so material choice is very important but then also the entire design was critical so can you design in a modular way so that you can easily replace
Components repair component design for repairability and serviceability that are critical elements think about platforms where you can swap components and maintain the frame of huge medical scanner for instance for many years in hospitals while changing components like cameras detectors upgrade software and the last element of that is business
Model so moving away from selling equipment to really offering integrated services and I think all of this is the core part of our strategy and it helps us to really engage with the businesses and get them along so maybe in let me
Summarize I think if you want to change the behavior of business leaders and experts in your company you need to have a very clear storyline and narrative that starts with the why you need to empower leaders formal and informal leaders to take action
You need to build capabilities and really train them for instance on equal design life cycle assessment and understanding the impact of their consequences and you need to embed this and processes so on every stage or product design process you need to have targets you need to align the incentives
You need to align the performance management cadence and that’s what we have done thank you very much You said some very important keywords It’s important that if society as a whole fails business Alone cannot be successful now some people are convinced early on but some people
Take a lot of time to be convinced so as management you need to organize a different narrative to convince different leaders so you’re working for the society and you’re also working for the business I think there’s a competitive compatibility between the two that is
The impression that I have from your comments and also I believe technology played a very important part that is my impression without material some elements can be covered with evolutionary technology and digital and I guess that you’re very deep felt discussion internally now Robert
For the members of the audience who are taking part they’re all interested in circular economy they want to contribute can you provide concrete examples of products and services that contribute to circularity for example do you have circularity products from Philips as examples thank you yeah of course so let me just
Start my answer with saying circularity is not a product property it’s a system property so you can design products in such a way that they are ready to become an element of the circular economy but you also need the right business models you need reverse logistic processes you need to
Work together with partners and that is different from energy efficiency you can design the product to be very energy efficient but you cannot design a product itself to be circular but you can enable it to become part of the circular economy so that’s important to understand
What we have done to give you complete examples over the last couple of years we have invested hundreds of millions to build refurbishment facilities so we really want to preserve the value of our products by not breaking them down to material and just reuse the
Steel and the copper in the wires but really use what we call higher R strategies so refurbishment remanufacturing reuse that is very important that means we have trained our field service engineers to do that we have designed our machines in a different way we have designed
Completely new concepts and technologies one example of that is for instance if you use these huge scanners MR magnetic resonance scanners for imaging in hospitals you have seen these they weigh many tons and they use thousands of liters of helium to cool these superconducting magnets we have developed a technology that
Basically allows you to operate a scanner without additional helium so we have reduced the entire amount of helium to seventy liters instead of three and a half thousand liters and close this cooling system helium is a very scarce resource I think that’s an excellent example for Eco design and something
That reduces the amount of resources that you need and it’s a fundamental breakthrough in technology which is much appreciated by the customers in our market on the consumer side of things you know that Avent the baby brand is part of our Philips company so for instance
We have developed a way where consumers can rent breast pumps rather than buying them so also enabling different business models to reuse uvaluable equipment rather than selling it and then losing side of it where it just gets used a couple of
Times and then vanishes somewhere in the cupboard I think all these are important steps to not just design the products in a different way but also to work with the customer in a different way thank you very much very concrete examples there’s so much
That we like to learn from your company and from you thank you so much for sharing now I’d like to ask Mr. Tagawa Nissan has been working too substitute materials resources you have come up with various strategies so you talk about it you are now doing use batteries and activities in Namie prefecture
So I think your activities are indeed very advanced in this regard I would like to ask a question and I want to be very candid with you Mr. Tagawa Nissan’s initiatives try to go beyond the customer demand with cars I’m sure that the customers don’t come to dealers for just requirements I think
You’re trying to go beyond the customer demand so why do you try to go beyond the customer requirements the customer demand but having listened to Pia and Robert’s comments actually the customers are making demands these days so my assumption has changed I thought there’s a difference in the markets of different countries actually
With our customers are you seeing concrete demands for circular economy in the Japanese Market or are you saying that you want to go 975 00:44:09,060 –> 00:44:12,420 ahead of the demand is that the case thank you for the question true for example say there’s a buyer of a vehicle Nissan
In Namie is recycling batteries so let’s use Nissan batteries do they do that or Nissan’s cars material is recycled so I won’t pick Toyota but rather choose Nissan I don’t think so many purchasers are making choice that way but take a look at the automotive sector or not just at the automotive
Sector but what are the challenges we are facing when you manufacture a car there’s so many types of material it’s it’s used it’s not just steel and aluminum we use other materials we use a lot of water and true that in some countries the
Population has saturated in some countries but according to the current forecast demand for cars will continue to grow and the number of owned cars and the number of vehicles sold will continue to grow can we continue to depend on resources in manufacturing cars either
The cost will become prohibitive or we will end up not being able to make cars so when we face the customers right now are they making choices by 1009 00:45:29,099 –> 00:45:32,119 thinking about the circular economy maybe not so but for companies that are
Paying attention to circular economy they will probably be funded by institutional investors and our Namie activities are well appreciated by the general public too Tesla’s EV are doing well in terms of their sales but when we launch Our EV in 2010 battery reuse secondary use Nissan’s battery is the highest
In terms of the number of batteries that are put to reuse so this is what we can do with Nissan’s battery for reuse it’s not just one-time use as a battery we can repurpose the battery like for a railway crossing or for disaster
Risk reduction or for electricity power company maybe they can use that as a storage battery or reuse that in the grid so if such technique is proven Chinese companies that has just begun to sell EVs or some emerging manufacturers are not really thinking that far to recycling but if Nissan takes a lead
Maybe we can also invite new ideas for 100 years, the automotive sector has been years making cars but now with electrification and connected cars yes it is a threat for us to see these new companies new entrants we use motors but even a Japanese company that’s number
One in the world in motors may see a competition from Honda and Sony getting together but that would also bring about new ideas even for circular economy you talked about linear economy and we continued with that concept for the past century but we can’t survive unless we depart from linear economy or
We may not be able to continue to manufacture cars unless we deport from that kind of concept that’s the sense of crisis we have so we’re not doing what we are doing just because we wanted to be appreciated by outside organizations but for us to survive in the automotive sector it’s a must
Thank you that is so convincing Nissan is the front runner in this area that is why you properly face various issues such as return of the batteries so you need to do something in practical terms so there’s a sense of urgency in terms of a practical operation that’s
Why you are here let me further ask you elaborate with the following question to you Mr. Tagawa the management team when there are new keywords the management team becomes very wary decarbonization has appeared as a keyword in relation to regulations but they’re not
Able to fully respond to decarbonization but now you have a new word circular economy that is emerging on the horizon so there might be overlaps between the two but the companies are struggling just with decarbonization if they’re asked to address circular economy it would be too
Much for them so there are probably such discussions among management what is the sense from management economy it’s not just about circular economy but in decarbonization short-term costs as Robert and Pia also mentioned that there is constantly internal debate within the company and of course that’s a topic that’s often discussed naturally but
Using what’s been recycled may be cheaper than what we create a new or it becomes more accessible and that’s a proven concept in the mid-term we’re going to see more of those examples like rare materials or rare metals if we’re going to continue to newly extract from the reserves it will
Be exploited one day and it will be exhausted we have to use rare materials over and over again or else re-engaging global business all around the world so we are constantly worried maybe one day we will wake up and find that we can no longer manufacture the car so decarbonization circular economy
So there’s no one in the top management who is negative but I’m going to spend 10 billion yen return in three years time will be so many percent of course then we have to use a certain yardstick to decide whether we do that investment or not but that applies for
Any investment project it’s not just about circularity or decarbonization are we going to come up with this new model we’ve experienced that over and over again it takes us so many years to recover the investment for this new model so it’s upon the top management to take all those factors into
Consideration and make adjustment it’s so convincing you have been trying and have really thought about changing the society based on your internal discussion within the company I get your sense of passion and the journey so far comes through in your comments
Thank you so much Mr. Tagawa so we have already spent half of the time for Balanced discussion and talked about why it’s important to make a transition why circular economy is so important so in the second half of the discussion I would like to ask your sense of challenges in delivering circle economy
Which you have experienced because you are indeed the pioneers in this area so you could share with us your challenges about possibly overcoming those challenges I would appreciate your insight into possible actions that could be taken so let me start with Mr. Tagawa I’m going to ask this question without
Any hesitation because you are on the panel there was one thing that I really wanted to ask from the beginning As you pursue electrification I think circularity becomes more challenging as you pursue electrification because the number of parts you use and the use
Of rare metals and where metals increase as a result of the pursuit of EVs so if it’s the difference between EVs and circularity how do you address the challenge under conflict between the different goals if it’s very challenging please tell us how do you try to overcome these
Different challenges that you see thank you of course it’s difficult no doubt about That for EVs the actual number of components is lower than ice cars internal compression engines as you say rare metals or the kind of materials that have not been
Used in internal combustion vehicles or something that is produced only in limited geographical areas or material that can be refined in certain geographical areas that’s becoming challenging but we’ve been creating engines for 100 years and we have the expertise for recycling those internal
Combustion engines we have ideas we have taken stock of those ideas so certainly we see the acceleration of electrification and EVs so be it batteries there was a nickel battery and then we saw the lithium-ion and all- Solid-state battery or LPM a slightly less expensive battery
Is attracting attention but the material used and the manufacturing methodologies are slightly different so recycling or actually extraction or reuse we haven’t come up with such technology so in that sense extremely challenging yes that’s true but with time passing electrification is indispensable
Thinking about global warming no one questions the truth of that then that means all the wisdom not just in the automatic automotive sector but from other sectors will be collected for recycling and for use in EVs one Japanese newspaper put up an article today for example if a single wiring harness
Is stretched out the total distance is roughly three kilometers unfortunately it’s not about Nissan but one company was able to shorten that to 100 meters unfortunately it’s not about Nissan but through recycling or through such technological breakthrough the amount of material used can be
Reduced we want to do something like that and we will be doing something like that and secondary use of batteries in motors rare metals are used but the quantity of rare metals has been reduced by 85 percent cobalt is used in batteries but we may be able to come up with cobalt-free
Batteries and in fact we’re beginning to see the realization of such innovation Nissan will do that our industry will do that and as I said the new entrance we will work with this new entrance and surely we will find a solution it’s
Going to be difficult it’s going to be harsh but it’s something that we need to do thank you very much for that insight on an unrelated note I would like to ask a question to Robert you heard Mr. Tagawa talk about issues that need to be addressed within the
Industry that they need to change all the way from the design phase Robert earlier we talked about some of the initiatives you were undertaking within your company at Philips now in regards to Europe Eco design has really taken root and the Japanese government is
Very interested in the Eco design concept of which is being promoted by the EU it’s a bit product repeat system you want to enhance security circularity from the design phase it’s important that you involve your stakeholders such as vendors based on cooperation between different stakeholders such as vendors in the case
Of Philips you’re involved in PACE platform for accelerating the circular economy you’re very much involved in the launch of PACE so how do you involve cooperation how do you create cooperation within the industry can you talk about how you built cooperation with different
Stakeholders and also the sense of challenge that you face as well thank you yeah thank you very much and maybe going back to the comments of Mr. Tagawa on innovation I think when you look at companies they have perfected often the way how they innovate technologies and
Products but that is not good enough if we really want to advance and accelerate circularity because we need to innovate at a broader scale I think the challenges that we see are the engine that enable and drive new innovation right but we need to innovate not just
At a technology level but we need to innovate how we deliver technology to the customers how we provide services how we return products how we finance these things and this is something that you cannot do at the company level alone that was one of the reasons why we have
Contribute to PACE over the last years we are one of the founding partners so decide together with the World Economic Forum the World Resource Institute and many other IKEA’s part of the collaboration I think the Japanese government was involved from the very
Beginning as were the Danish and the the Dutch government for instance they’re more than 100 companies one of the things that PACE has done is you find very clear action agendas around these challenges and sharing best practice and I think that is a fantastic platform where you can learn from each
Other so that you do not have to reinvent the wheel at every different company again you can look up PACE Circular on the internet you will find the action agendas and the new strategic focus and please do join I find it a very useful platform yeah thank you
Thank you very much for that indeed of course companies that lead industries in a very difficult position you have to of course compete you have competition in the marketplace because you’re a business but on the other hand I think Robert you have been very consistent in your remarks
If the industry is failing then your company cannot be successful in the face of the failure in the industry so even if you’re successful at this moment you meant to be able to rely on the same system a few years down the road so
Everybody will fail if that is the case so it’s very important that platform related initiative is very important and I think Japanese companies should cross borders and take leadership across different borders and that enterprise value of such companies will increase as a result thank you very much for that
Input now a question to Miss Sato earlier you mentioned you’re very innovative activities pertaining to disclosure of information those of you on the panel today you understand the relevance of these initiatives you understand the potential impact on your future finance but many business persons see this initiative as
A cost so it’s important you need to convince you need to communicate to various people that this is not the cause but an opportunity so what are some of the challenges when you try to convince various people that this is indeed not a cause but
Opportunity what type of materials are necessary to convince these people that this is an opportunity and not a cost Miss Sato please thank you I’m going to introduce an example from our own company but before I do that I would like to talk about our goals
With regard to energy savings so let me introduce this material please so we have set targets we have to make sure that we reduce based on the concepts that we need to reduce the input let’s make sure that the material input will be reduced to 1/8 so we’ll
Set a use of target use of new materials of course where we use new materials we need to come up with design reuse materiality recycle this is very important against the backdrop in 2023 our company produced A3 color multi-functional printers and what we did was to use so-called post-consumer plastic materials for more
Than 50 percent this is the product which we produced I would like to show you the slide to introduce this product please show the slide yes this is it this is the A3 full-color multi-functional printer we have seven different models A4 could be could be produced up until 2014.
As I mentioned earlier what we do is introduce 50 percent of so called post-consumer plastic material and please turn to the next page we have also introduced several different functions that are environmentally friendly again we use 50 percent of post-consumer plastic material in this product let me talk about some of the stories
Behind how we were able to successfully achieve 50 percent of post-consumer plastic materials In the case of this multi-colored A3 multi multi-function printers use of new materials it’s more expensive compared to using recycled so if you want interest from consumers if you introduce five percent that’s as far as they can see because this will lead to increasing
Cost so that being the case yes it’s used to a certain extent plastic cost is higher compared to virgin plastic but if you set a very high target for introduction of this new type of materials then you need a breakthrough that so what we wanted to do
Was set a higher target for introduction of post-consumer plastic materials but then complaints that this would lead to increasing costs came so if you have a target of 50 percent this means the cost is tenfold so therefore there has been resistance against this target
At the end of the day as I mentioned earlier there’s the ESG trend that if we address circular economy right now this could have positive impact for finances later down the road so this decision of this target was made top-down in one single printer if it is about 50 percent post-consumer
Plastic materials then in terms of quality and in terms of the coloring just pertaining to the functionality and the coloring so therefore we set up a cross-functional team to address these challenges we set up a cross-functional working team to address such challenges so not only design and we also
Procurement marketing and to secure all departments and also ESG departments we were all involved from the stage of engineering and development and then a addressed each of the challenges that emerged step-by-step as I mentioned earlier there is the issue of increasing costs if it’s more than 50 percent of post- consumer plastic
You cannot say that just because we have such wonderful friendly materials we are asking to pass on costs to the customers we cannot do that so we need to reduce cost of other materials cost cut costs in other Areas of consumer plastic materials
We need to make sure that they’re cost competitive to other conventional techniques and we were successful in doing that we’re able to contain the cost of internal development because there were plastic materials this was a very important success factor for this challenge this was very meaningful and significant
Now this is one good example of this effort now we were aware that the possibilities or transactions and negotiations About such products will increase and actually the fact that we had this product was very positive for various transactions this refers to carbon footprint on the right hand side of the chart
If these recycled materials have used biomaterials then you’ll be able to reduce CO2 so therefore compared to the previous models over the life cycle you’re able to reduce the carbon footprint by more than 27 percent compared to the previous products earlier we talked about the Eco design regulations in the EU
That it’s not being considered the CFP disclosure is going to be required against the backdrop and also even in Japanese green law carbon footprint disclosure is going to be required that is now the discussion taking place so in the case of multi-functional printers this is also part of this issue and from
Next year onwards we need to discuss the carbon footprint for this product and also with regard to we felt that the inquiries pertaining to circular economy was not increasing but that is not the case inquiries are increasing so I think we now have a case by the
Trend in the community and marketplace is very much consistent with what we’re doing so this is a very good example thank you so much you said that your company made it’s decision to adopt this consumer 1519 01:06:33,960 –> 01:06:37,680 plastic materials and in order to
Overcome various challenges to overcome That you setup cross-functional teams so you try to make sure they I think Ricoh’s decision was very strong that you really wanted to address this topic as the members of the working team they’re not just part of design and the design phase as Robert mentioned innovation
Doesn’t come from engineering and innovation it’s about marketing itself in the case of Robert you’re talking about financing so it’s important that business as a whole addresses these issues so that was a very easy to understand example thank you so much for that next question to Pia
In your company Teneo you mentioned that recycling is not the answer you frequently say that recycling is not the answer I identify with your comment I think this is very essential to circular economy so let me ask this question to Pia it is not a journey to introduce the circularity
Ratio I think mass input is not the answer if we were to create a truly sustainable society I think you need to reduce the amount of resource input that represents the major challenge in my view so if that is the case
It’s important that you you’re not undermining the well-being of an economy but at the same make this compatible with reduction of resource input what is necessary to make this compatible I would appreciate your insight and advice how can we address circularity ratio how can we reduce material
Input without undermining Well-being maybe we need to involve government maybe we need to involve civic society can you share with us your advice we shouldn’t focus not just as a material ratio how can we reduce material input I would appreciate your thoughts thank you Pia please
Thank you it’s a very big and difficult question I think that this different phases in this like Robert said circularities is fundamentally systems thinking where we need to think about in a company’s perspective how we design products how we interact with customers around the product and how we take care
Of the product afterwards but that involves also the regulatory framework and enabling us to do this where for example like at IKEA when we wanted to take back plastics from our logistics units they are not plastic products that are sold the customers yes
But from the transport we had to register as a waste company because we couldn’t handle the waste in our stores if we were not registered as a waste company and then yes bringing that up to the EU and sharing this example they
Were of course not aware of the kind of unintended consequences of something that was a good intention from the beginning so having the dialogue between the different stakeholders and then of course with customers even if we did see across the globe so not just in Scandinavia but across the globe we saw
A big interest from customers when it came to second-hand when it came to renting and leasing so the need for ownership is changing across the globe people want access to the function of the product rather than having to own the product it depends on products of course but overall there’s a trend but
But having said that consumers still want it to be easy they want it at the same price and they want the same quality and then they want it sustainable so they they’re not willing really to give up something of all the other good criteria yes to feel like they’re sustainable and doing something
Good so you need to make it easy and I think if it’s for Nissan or if it’s for Philips or if it’s for IKEA you can’t produce products that are worse than the old ones and then just put a green label and say this is better for
The planet because they need to be better and I think that’s where the innovation and the creativity comes in you think how do We make everything that we produce and the model we’re in better and that’s kind of here and
Now but then of course I fully agree with you regarding mass production mass consumption and mass waste and that is a big societal systems’ fault that we’re in where we created the business and the economy based on the knowledge we had 200 years ago and we’re still measuring GDP
In a way that fit in the old system but not with the knowledge we have today we are measuring profits in companies based on what we knew and rather than maybe a circular model where the income streams would look different I’m not saying less but different than the model
That we have today and consumers with marketing we’re used to always having the latest and the newest because that’s how we show that we’re kind of cool and in and are successful so there’s a lot of things we can do here and now and I
Think we are doing here and now through government with legislation through companies with circular products and different activities and with consumers testing it but I also do think that there is something bigger where we really need the platform of PACE but also government interaction with
Companies World Economic Forum kind of bigger forums where we start to really reflect on how do we tax things how do we promote the activities of companies and how do we really interact with citizens and consumers so so this is kind of a bigger thing that we really need to solve with the
Knowledge that we have today that we didn’t have 200 years ago when we started the Industrial Revolution thank you so much we are now working towards a major system change it’s not just engineering and technology we need philosophy we need thinking we need vision everything needs to be reflected everything needs
To be combined in order to adjust these challenges that’s the impression thank you for your comment so all participants on stage taking part in this discussion today our leaders in this field you have such wide extensive knowledge know-how and wisdom I really get the sense that we are
Indeed changing I’m afraid my time management was poor we were not at the end of the session the other debate each panelist is to share with us very briefly you can talk about your thoughts if you have a message to the members who are listening I would appreciate that so
We’d like to have a last wrap up coming from each of the panelists so let’s start with Miss Sato if you would like to give us your final message thank you thank you Robert Pia Mr. Tagawa and Mr. Hanyuda I have learned and I’ve taken
A major message from my other panelists I was going to talk about something that I was going to share with you toward the closing of the session in a seminar which is which has been hosted by Nissan in this manner You have various messages the fact that
You’re able to deliver the message to a very wide audience this is very important if we are to realize the society which Pia has talked about so this is a sense of education it’s a matter of gaining understanding and also
Gaining and also people identifying with these views I think this type of forum is very important to such understanding as far as we’re concerned we hope to be able to encourage customers to choose these type of products it’s important that we deliver such values to
Our customers through our products earlier I introduced about our company through the presentation the ESG is about to have a positive impact of financial performance over the Short-term yes this might seem as though there is a factor of cost But the long-term will have a positive impact on financial performance over the long-term
I hope that all of you will take actions now in one way or another please take action now thank you once again for this opportunity thank you Robert final comment your message please Robert yes thank you I would just say it is clear that circular models are strategically
Important for every business regardless in which industry you’re in so you need to think about it but you need to understand that it’s not just the product property so you need to work together with partners with your customers with your suppliers with regulators to drive the change there are
Plenty of great examples we need to scale them now so it’s time for action at scale thank you thank you your final message please Pia yes thank you two reflections one it’s important that we start here and now and take action while also reflecting on that there is a need for a bigger
System change so I think my main message is not to sit and wait until we have sold everything sold the best-ever legislation the best-ever product the best-ever customer interaction we need we are in the test and learn phase and then I fully agree with Robert
We also have a lot of good examples that needs to be scaled at a pace that is much faster than today so that’s one reflection and the second one thing that has come up several times today is this with the
Language it’s a new language for a lot of managers from a lot of leaders that first comes climate and carbon and now comes circularity biodiversity water scarcity human rights I mean ESG and diversity equity and inclusion that you’re talking about I think it’s important to understand
That this is the language of business in 2023 and will be even more so in the future so yes this is maybe not what we learned in university when we went to school 20 or 30 years ago but this is what the kids today are learning
And this is the language that we need to learn and be masters of the language of business Thank you Mr. Tagawa your comments I want to thank all panelists for their comments and Mr. Hanyuda your comments in between the comments of the panelists were very knowledge
Intense like was the case last year I listened to the panelists and I was much encouraged that this planet will survive thank you so much I’d like to end this discussion session 1802 01:18:34,640 –> 01:18:39,000 circular economy from idea to action thank you so
Much for your beautiful message as Mr. Tagawa mentioned I think we were able to be very positive at the end of the session thank you so much for participation thank you I like to thank all the panelists for their participation thank you very much
This concludes the Sustainability Seminar 2023 Circular Economy session as mentioned the Sustainability Seminar 1811 01:19:03,840 –> 01:19:06,140 is available online please access the website thank you once again for your kind participation good day thank you
(Click the “CC” button in the lower, right-hand corner for closed captions in English)
Join us for the Nissan Sustainability Seminar 2023 to hear from thought leaders on how making the shift can lead to new opportunities.
#Nissan #Sustainability #CircularEconomy #SustainabilitySeminar
Nissan hosted its third sustainability seminar, with global experts in different industries providing insights on the circular economy and diversity, equity and inclusion (DEI). In the circular economy session, Joji Tagawa, Nissan’s chief sustainability officer spoke, then joined the panel discussion to discuss how a circular business model can reduce resource dependency and accelerate the adoption of green initiatives.
More on Nissan’s sustainable approach, here: https://www.nissan-global.com/EN/SUSTAINABILITY/
Moderator and panelists:
Keisuke Hanyuda (moderator) – Managing Director, CEO of Owls Consulting Group, Inc.; Special Advisor to the Minister’s Secretariat, Ministry of Economy, Trade and Industry (2021 and 2022)
Joji Tagawa – Senior Vice President, Chief Sustainability Officer, Nissan Motor Corporation
Robert Metzke – Chief of Staff Innovation and Strategy, Head of Sustainability, Royal Philips
Pia Heidenmark Cook – Senior advisor, Teneo
Takako Sato – Circular Economy Expert, ESG Strategy Division, Ricoh Co., Ltd.
Chapters:
00:00 Opening
01:51 Keynote speech by Nissan CSO Joji Tagawa
11:48 Panel discussion introduction
21:35 Theme 1: Why is shifting to a circular economy important?
50:59 Theme 2: A circular economy: The challenges
01:18:47 Closing
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