Environmental Policy and Strategy

• Basic Approach and Policy
• Promotion Structure
• Mechanisms and Initiatives
• Environmental Education and Awareness Activities

Basic Approach and Policy

The Olympus Group's environmental initiatives are founded on its Corporate Philosophy, the Olympus Global Code of Conduct and the Environmental Health and Safety Policy^*. The Olympus Global Code of Conduct sets out our policy on the environment and the actions required. The objectives are described with clarity and detail in the Environmental Health and Safety Policy.

* In May 2015, we published the Olympus Group Environmental Policy. This was based on the Olympus Group Environmental Charter adopted in August 1992, to which we added aspects on both environmental protection and economic growth. This Environment Policy was then converted into the Environmental Health and Safety Policy in April 2021, by incorporating environmental health and safety policies to comprehensively manage our EHS activities.

Environmental Health and Safety Policy

Promotion Structure

In the Olympus Group, the CEO and the CHRO (Chief Human Resources Officer) are appointed as the top executive officers for the environment. Also, the Human Resources Head, who manages human resource development and general affairs including matters related to the environment, health and safety (EHS), serves as the top management for environmental affairs for the entire Group. Under the Environmental Health and Safety Policy formulated by the Human Resources Head, the EHS division plans and implements environmental measures and monitors environmental initiatives across the entire Group, such as the progress of energy reduction targets and implementation status of environmental measures.
We have environmental management divisions for each business site and Group company. The EHS division is responsible for environmental management for the entire Group. Since FY2015, the EHS division has created an information platform for the entire Group to enable efficient gathering of information on environmental initiatives at various global sites that are essential to environmental management, as well as environment-related data and the status of these sites in complying with laws and regulations. In FY2021, the Olympus Group obtained ISO 14001 multi-site certification*, which covers 2 group companies in Japan and Asia region, including the EHS division, to reinforce the group's environmental governance and streamline the environmental management.

* A system in which multiple factories and business offices are certified as a single organization

Environmental Management Structure

Status of Acquiring ISO14001 Certification in Olympus Group (As of August 2024)

Mechanisms and Initiatives

Long-term Targets and Measures

The Olympus Group is fully aware that the recent environmental pollution, climate change resulting from the human activities, and other impacts on ecosystems are issues we need to address promptly. In May 2021, we added "carbon neutral society and circular economy" to the materiality items. We also set ambitious targets of achieving carbon neutrality*1 with respect to greenhouse gas emissions from our site operations (Scope 1 and 2^*2) by FY2031 and using electricity generated 100% from renewable energy for our site operations by FY2031. In addition, in May 2023, we formulated and announced a target of achieving net zero^*3 greenhouse gas emissions throughout the entire supply chain (Scope 1, 2, and 3^*2) by FY2040. In October, the SBTi certified that the Olympus Group’s net zero target is consistent with the 1.5° C target level specified in the Paris Agreement.

To achieve caron neutrality by FY2031, the entire Olympus Group is working together to improve production processes and implement further energy-saving measures and accelerating initiatives to reduce greenhouse gas emissions including gradually replacing the energy used in our site operations^*4 with renewable energy sources and other measures. We also recognize the importance of environmental impact reduction across the supply chain and continuously implement measures to develop environmentally-conscious products, improve logistics efficiency, set voluntary greenhouse gas emission reduction targets in cooperation with suppliers, and support decarbonization initiatives in an effort to achieve sustainable business.

*1 Carbon neutrality refers to reducing greenhouse gas emissions from site operations (Scope 1 and 2) and offset an amount equivalent to the remaining greenhouse gas emissions using carbon credits, thereby achieving zero emissions overall.

*2 Scope 1: Direct greenhouse gas emissions by combustion of fuels in our sites.
Scope 2: Indirect greenhouse gas emissions from our sites use of electricity, heat or steam supplied by other companies.
Scope 3: Other, indirect emissions of greenhouse gas emissions (excluding Scope 1 and 2).

*3 Net zero means reducing greenhouse gas emissions (Scope 1, 2, and 3) as much as possible (at least 90%) in line with the latest climate science (1.5°C scenario) and using credits derived from carbon sequestration and removal (such as afforestation and CO₂ capture and storage) for an amount equivalent to the residual greenhouse gas emissions (less than 10%) to achieve a balance.

*4 Excluding rental properties, such as sales sites.

Major Environmental Activity Results in Fiscal 2024

Compliance with Environmental Laws and Regulations

Olympus Group continuously develops and maintains internal rules and regulations adapted to statutory requirements, and trains environmental managers and related personnel, as well as monitoring and improving on-site management.
In FY2024, there were no serious violations of laws and regulations or accidents that had a serious impact on the environment, and no fines or penalties were imposed, and no sanctions other than monetary sanctions were imposed.

Accident or violation of laws and regulations in FY2025 (updated on August 30th, 2024)

ESG Data

Response to Climate Change

Task Force on Climate-Related Financial Disclosures (TCFD)
The Olympus Group recognizes that climate change is a serious issue that threatens the global environment, as well as having grave implications for the group's business activities. Based on this awareness, we announced our endorsement of the Recommendations of the TCFD in May 2021, as a part of our contribution to building a carbon neutral society and circular economy in our Corporate Strategy. According to the TCFD's recommendations, the Olympus Group will disclose its climate-related financial information in a timely manner.

Governance

The Olympus Group endeavors to reduce the environmental impact from the entire value chain, including product development, procurement, manufacture, logistics, sales, and repair. Under the CEO, the CHRO (Chief Human Resources Officer), who manages the environment, health, and safety (EHS) functions, oversees matters related to the environment) for the entire Olympus Group. In addition, an officer responsible for ESG (Environment, Social and Governance) was appointed and set targets for the ESG field including greenhouse gas emissions in the medium- to long-term business plan to promote ESG initiatives by the Olympus Group.

Under the Environmental Health and Safety Policy formulated by the CHRO, the EHS division created an environmental action plan for the entire Olympus Group in line with the ESG targets set in the medium- to long-term business plan, monitors the status of progress of that plan, and makes continuous improvements. In response to progress reports, the executive offices responsible for the environment (the CEO) give instructions for any improvements required. The Board of Directors monitors the status of the implemented climate change measures while receiving related reports as necessary. Also, to reinforce the commitment of management to the ESGs and climate change initiatives, 10% of the executive officers' performance-based stock remuneration, a part of our long-term incentive remuneration, is linked to the evaluation results of an external ESG evaluation organization.

Environmental Health and Safety Policy

Strategy

The Olympus Group identifies risks and opportunities related to climate change for the short-term, medium-term, and long-term periods by using scenario analysis. The influence of climate change on our business activities is analyzed based on 1.5-degree scenario: RCP 1.9 (NZE) (keeping the increase in the global average temperature to below 1.5° C above pre-industrial levels), and the 4-degree scenario: RCP8.5 (where the increase is assumed to be up to 4° C above pre-industrial levels), both of which were presented by the International Energy Agency (IEA). We identified that the major risks in short-term (one to five years) would be the suspension of factory operations, breakdown of supply chains due to natural disasters, or impairment of stakeholders’ assessments or Group’s reputation with stakeholders due to inadequate responses to climate change or insufficient disclosures; and the risks within the medium- to long-term period (5 to 20 years) would be an increase in business costs due to the introduction of carbon taxes and further tightening of greenhouse gas emissions regulations.
Although such climate change risks could affect our corporate strategy and financial plan, we assume that the scope of impact would be relatively small. For example, the geographical location of our factories in terms of natural disasters, such as typhoons, can be classed as a physical risk. We confirmed that our factories are at low-risk locations and a business continuation plan for each site has been created in case of emergency. In terms of supply chains, storms and flooding have occurred on a global scale recently and are expected to have impact on material procurement and product supplies, and accordingly, we are working to establish systems that can ensure production through alternative suppliers. We also expect an increase in operational costs due to carbon taxes etc. as a transition risk. However, the percentage of energy costs in the factories among overall business costs is small, and, therefore, the impact on our business will be limited.
As a climate change opportunity, we will continue development of environmentally conscious products with energy-saving and other functions, taking the rising requirement for such products, which contribute to greenhouse gas emissions reduction, as a business opportunity. However, we estimate the impact from this opportunity on our business will not be so large because the majority of our products are already small with low energy consumption, and the nature of our products and services are relatively independent from any impact from climate change.

*The calculated financial influence was approx. 900 million yen/year based on the carbon tax figures in the World Energy Outlook 2020 by the IEA (2020).
Time axis. Short term: 1–5 years; medium term: 5–10 years; long term: 10–20 years
Degree of impact: Amount of financial impact and three-stage assessment from the perspectives of operations, stakeholders, and compliance

Roadmap For Achieving Net Zero Emissions

• We plan to periodically update the roadmap for achieving net zero emissions, taking into consideration scientific advances, regulations, and other factors.
• ★: Subject to SBT certification

Risk Management

During the management strategy and business plan formulation stages, the Olympus Group identifies risks that have the potential to impact the Group’s business and identifies and evaluates those risks that could have significant impacts on business operations. These risks include regulations relating to the environment including climate change, technology and other transition risks, and physical risks resulting from natural disasters.
Identified risks are evaluated and prioritized by each organization based on the degree of impact in the case where a risk materializes and the possibility of occurrence, and based on the results, we formulate single-year and multi-year business plans to manage the risks. Regarding risks relating to environmental laws and regulations, the quality control function monitors developments concerning those environmental laws and regulations related to our products, and the environmental division of each company monitors regulatory developments relating to their business sites, and each periodically evaluates the status of compliance, and takes measures as necessary.
To address those risks that could have a particularly substantial impact on business operations, we periodically monitor the status of organizational risk management and report the results to the Group Executive Committee and Board of Directors. The CEO receives reports on the results of monitoring of the status of risk management, and if measures are ineffective, directs a review of the action plans.

• Risk Management System
• Business Risks

Indexes and Targets

The Olympus Group set a target of achieving net zero greenhouse gas emissions (Scope 1, 2, and 3) throughout the entire supply chain by FY2040 and in October 2023 received certification from the Science Based Targets initiative (SBTi) that our net zero target and short-term targets are consistent with the 1.5° C target.

Targets Certified by SBTi

Net zero target	Achieve net zero GHG emissions (Scope 1, 2, and 3) throughout the entire supply chain by FY2040
Short-term targets	Reduce GHG emissions (Scope 1 and 2) by 70% compared to FY 2020 (baseline year) by FY 2031
	Set GHG reduction targets based on scientific criteria for 80% of our supply chains by FY2028 (on the basis of emissions for purchased goods and services, capital goods, and upstream transportation and distribution)

In FY2024, we reduced Scope 1 and 2 greenhouse gas emissions by approximately 51% compared to the baseline year (FY 2020) and regarding Scope 3, approximately 30% of suppliers (based on transaction amounts) completed setting science-based greenhouse gas reduction targets.
To achieve our greenhouse gas reduction targets, we will improve manufacturing and further switch to and introduce renewable energy at sites in countries around the world and continuously implement measures to develop environmentally-conscious products, improve logistics efficiency, set voluntary greenhouse gas reduction targets in cooperation with suppliers, and support decarbonization initiatives.

• Long-term Targets and Measures
• Results

Preservation of Natural Capital

Based on our belief that biodiversity is essential for the global environment and the richness of our lives, the Olympus Group has taken action to conserve biodiversity through the management of water use and wastewater at each of its business sites and maintenance and management of green spaces as well as clean-up activities in the vicinity of business sites, forest conservation measures, and tree-planting. In recent years, it has been pointed out that the degradation of natural capital, including the land, oceans, freshwater, and air that contain biodiversity, could have major impact on the environment, society, and economic activities. Consequently, it is becoming increasingly important to identify risks and opportunities regarding which business activities depend on or have an impact on natural capital and to manage the key risks and opportunities in accordance with international initiatives such as the TNFD^*1 and SBTs for Nature^*2. Based on these developments, the Olympus Group began investigating using the LEAP approach, which comprises four steps: Locate, Evaluate, Assess, and Prepare. The LEAP approach is recommended by the TNFD as a means of appropriately evaluating and disclosing risks and opportunities relating to natural capital (land, oceans, freshwater, and air) in order to achieve a high degree of compatibility between conservation of natural capital and business activities. Below are the results of an early-stage investigation of the relationship between business activities and natural capital using the World Wildlife Fund (WWF) Biodiversity Risk Filter^*3 and the results of an evaluation conducted using the World Resources Institute (WRI) Aqueduct Water Risk Atlas,^*4 a water risk evaluation method that we’ve been using for some time.

*1Task Force on Nature-related Financial Disclosures. An international organization that develops frameworks for appropriately assessing and disclosing risks and opportunities relating to natural capital and biodiversity in corporate activities. (Source: Ministry of the Environment)

*2Science Based Targets for Nature. Measurable, actionable, and time-bound objectives relating to the interconnected systems of water, biodiversity, land, and oceans in value chains based on the best available science that allow actors to align with Earth’s limits and societal sustainability goals. (Source: Ministry of the Environment)

*3Biodiversity Risk Filter. A regional biodiversity assessment tool based on information concerning biodiversity loss, including deforestation, pollution, and changes in land use for agriculture, created by the WWF.

*4Aqueduct Water Risk Atlas. A water risk assessment tool created by the WRI.

Biodiversity Evaluation Using the Biodiversity Risk Filter

We conducted a biodiversity screening evaluation for our main development and production sites using the Biodiversity Risk Filter. The evaluation confirms that no sites fall under the Very High level in terms of physical risk or reputation risk. The main sites that fall under the High level are multiple manufacturing sites in Japan and China.

Result as Defined by the Biodiversity Risk Filter and Number of Major Sites

Result of Water Risk Evaluation as Defined by the Aqueduct Water Risk Atlas

We conduct water risk evaluations for our main development and production sites using the Aqueduct Water Risk Atlas and have confirmed that no Group business sites have a substantially high water risk. Also, although the impact on our business activities is minor, we are taking measures such as locating business sites in areas with abundant water, reducing water usage in business activities, assigning managers to wastewater facilities, and regularly measuring wastewater.

Result of Water Risk Evaluation as Defined by the Aqueduct and Number of Major Sites

Total Water Usage by the Result of Water Risk Evaluation as Defined by the Aqueduct

Based on the initial evaluations that we conducted at this time, we will conduct detailed surveys and evaluations based on them and implement measures to address risks and opportunities relating to natural capital.

Green Procurement

Olympus published the "Olympus Group Green Procurement Standard" in 2001.
The Green Procurement Standard, which is also posted on our website, explains the Olympus Group's approach to its environmental activities to all suppliers.
In addition, through the corporate survey that we conduct once a year targeting major suppliers around the world with whom we conduct ongoing business, we confirm that status of the following measures, and we are working with suppliers to raise the level of our environmental activities.

• Establishment of environmental management systems and acquisition of ISO 14001 certification
• Compliance with laws, regulations, and social norms
• Determination of environmental impacts, setting targets, and taking action to reduce impact (GHG emissions (Scope 1, 2, and 3), water use, and amount of waste discharge)
• Countermeasures against chemicals
• Measures for environmentally-conscious products
• Biodiversity conservation

Olympus Group Green Procurement Standard

Environmental Education and Awareness Activities

The Olympus Group recognizes the importance of greater environmental awareness by each and every employee and full participation in environmental activities under the Environmental Health and Safety Policy. We are running more environmental awareness activities such as the Olympus Environment Day, a global group-wide event. In FY2024, as part of our Olympus Environment Day initiatives, an environmental e-learning program was conducted involving all Group employees, to promote group-wide awareness of important environmental issues, such as climate change, measures for achieving the long-term target of carbon neutrality, measures to address resource circulation including reducing the amount of water use and waste, and the state of environmental activities throughout the Group. We held events adapted to regional characteristics to promote environmental awareness in our major sites.

We have also introduced special training programs to improve our environmental management system and implement it effectively. These include programs on compliance with environmental laws and regulations, and ISO 14001 internal audits at facilities around the world, and site-specific environmental e- learning based on site conditions.

Major Environmental Education Programs (FY2024)