Prevention of Pollution and Resource Circulation

Policy and Basic Concept

Prevention of Pollution

Within its business activities, ITOCHU will strive to prevent and reduce environmental pollution caused by chemical substances and oils, and marine plastic waste, reduce emissions of air pollutants, and reduce and properly process hazardous waste and wastewater. We will fulfil our responsibility of pollution prevention by complying with international declarations, agreements, and treaties, as well as with the laws and regulations of the countries and regions in which we operate. We shall also comply with any other agreements that we have consented to.

Resource Circulation

ITOCHU handles a wide range of products, from plastics to metals, rubber, cement, and foodstuffs. We have identified “Ensure Stable Procurement and Supply” and “Address Climate Change (Contribute to a Decarbonized Society)” as ones of our key sustainability material issues. We will contribute to the formation of a circulating society with our business investees and stakeholders in the value chain of the products we handle to reduce the procurement of raw materials that have a negative impact on the environment and natural capital, and to promote resource circulation. We aim to realize resource circulation through the 3Rs (Reduce, Reuse, Recycle) and substituting sustainable raw materials from the design stage of products and services, and promoting sorting, collection, and recycling business for used products. We will actively work to procure raw materials and products with third-party certification for sustainability, with due consideration of appropriate use of natural capital, traceability, and consideration for local communities, etc.

Targets and Action Plan

ITOCHU sets qualitative management targets and quantitative performance targets to promote better practices in pollution prevention and resource efficiency. The environmental targets and achievements in FYE 2025 are as follows.

Qualitative Targets

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Item		Boundary	Target	FYE 2025 Results and Evaluation
Prevention of Environmental Pollution and Compliance with Laws and Regulations	Risk Assessment for Investment and Financing Projects	ITOCHU Corporation	Perform pre-investment/financing assessments based on the ESG Checklist, which includes environmental assessment criteria.	Properly implemented
	Raising Management Levels through Auditing	ITOCHU Group	Conduct internal audits on environmental management systems to ensure compliance, improved environmental efficiency, and better overall management.	Properly implemented
	On-Site investigations of Group Companies	ITOCHU Group	Select appropriate Group companies and conduct on-site environmental management investigations for them.	Properly implemented
Promotion of Awareness Activities	Raising Awareness of Laws and Regulations	ITOCHU Group	Increase internal awareness on the Waste Management and Public Cleansing Act and the Soil Contamination Countermeasures Act, as well as other relevant regulatory developments by providing learning opportunities such as seminars and courses. We will also monitor and review participation/uptake rates of these trainings in relevant segments of the company.	Properly implemented
Resource Conservation, Promotion of Resource Circulation, and Monitoring of performance	Office Waste Reduction	ITOCHU Corporation	Reduce waste and promote recycling in office activities in accordance with our EMS.	Properly implemented
	Paper Consumption Reduction Target	ITOCHU Corporation	Reduce paper consumption by raising awareness of our targets internally.	Properly implemented

Quantitative Targets

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Item		Boundary	Target Period	Target	Progress in FYE 2025 Against Targets	Assessment
Prevention of Pollution	Serious Environmental Accident	ITOCHU Corporation^*1	Every Fiscal Year	0 Serious Environmental Accidents	0	Achieved
	NOx SOx Emission Concentration	TAKIRON TECH CO., LTD.	Every Fiscal Year	Suppress to a level 20% below the legal standard	Achieved	Achieved
	NOx SOx Emission Concentration	ITOCHU Ceratech Corporation	Every Fiscal Year	Suppress to a level 20% below the legal standard	Achieved	Achieved
Resource Circulation/ Waste Discarded	Volume of Waste Discarded	Tokyo Headquarters^*2	March 2031	29% Reduction Compared to FYE 2020	46% Reduction Compared to FYE 2020	Achieved
Resource Circulation/ Waste Discarded	Recycling Rate	Tokyo Headquarters^*2	March 2031	More than 90%	92%	Achieved
Resource Conservation	Paper Consumption	ITOCHU Corporation^*2	March 2031	33% Reduction Compared to FYE 2020	55% Reduction Compared to FYE 2020	Achieved

ITOCHU Corporation, Overseas offices, Group companies subject to compliance
We are aiming to commence the rebuilding of the Tokyo Headquarters building in September 2026, but the details of the plan are still underway. Once the details of the relocation plan are finalized, we will set new targets based on the management status of the temporary location.

Action Plan

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Risks	Opportunities
Negative impacts on the natural environment including those related to resource circulation. Deterioration of relations with local communities and subsequent loss of social license to operate.	Increased resource demand due to population growth and enhanced living standards in emerging economies. Creation of customer trust and new business opportunities through stable and sustainable supply chain practices.

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Materiality	SDGs Targets	Impact Classification	Issues to Address	Business Area	Commitment	Specific Approach	Performance Indicators	Degree of Progress
Textile Company
Ensure Stable Procurement and Supply		Prevention of Pollution and Circulating Society	Reducing our environmental burden by circulating society	Textile products in general	We will contribute to realize a Circulating Society through our sustainable textile products and recycling of them.	Promote sustainable products and projects leading to the recycling of resources.	Promote the sustainable products such as “RENU”, a recycled polyester derived from textile, and set up schemes to recycle textile products.	The environmental impact of handling recycled polyester through the RENU project is as follows (estimated for FYE 2025). Waste volume to be made into “RENU”: equivalent to 6.2 million T-shirts, CO₂ reduction: 1,906 tons, Water usage reduction: 6,416 kiloliters. Approximately 4,300 collection points for “Wear to Fashion”, the clothing recycling service (as of March 2025). We are currently operating a joint project called the “ARChemia Project”, which involves textiles and chemicals, and transforms used clothing into chemical products with high environmental added value. To date, more than 10 companies have adopted this project, and we are continuing to promote its expansion.
Machinery Company
Address Climate Change (Contribute to a Decarbonized Society)		Water Resources Pollution Prevention and Resource Recycling	Improving water and sanitation infrastructures	Water and environmental projects	We will contribute to improve the sanitary conditions, the development of economic activities, and the protection of the global environment through the appropriate treatment and effective use of water and waste.	Expand water and environment projects to promote the appropriate use and treatment of water and the effective utilization of resources, and reduce the burden on the environment.	Expand the investment portfolio in the water and environment field which contribute to social demands for the environment and the promotion of a circular economy.	Environmental Field UK: Our operations encompass three municipal solid waste incineration and power generation facilities (Energy-from-Waste/EfW plants), processing 850,000 tons of waste annually. These plants provide electricity for 100,000 British households equivalent. Serbia: We set up first integrated waste management system in the Republic of Serbia. It contributes to the environmental issues such as greenhouse gases (GHG) (CO₂ equivalent) emission and polluted water leakage due to the inappropriate waste treatment. We have initiated an integrated waste management operation, including an EfW facility from July 2024. The project anticipates a reduction of approximately 210,000 tons of GHG emissions and has received Certification of Carbon Credit from the Gold Standard. UAE: We are currently operating the first EfW project in Dubai. These facilities are designed to process half of the Dubai’s municipal solid waste annually (1.9 million tons). The construction of this plant, the largest of its kind in the world, was successfully completed in August 2024. Saudi Arabia: We are actively engaged in integrated hazardous waste management services in Jubail Industrial City.
Metals & Minerals Company
Address Climate Change (Contribute to a Decarbonized Society)		Climate Change Opportunities Capital Introduction	Taking countermeasures against climate change	Resource recycling business	We will realize stable resource supply as our social mission and responsibility while fully considering its environmental impact. We will contribute to climate change issues through businesses that help to reduce greenhouse gases (e.g., lighter-weight vehicles and electric vehicles (EVs)) and the stable supply of essential materials.	Take the lead in developing recycling-orientated business.	Promote recycling-orientated business.	We are contributing to the effective utilization of limited resources and the supply of environmental materials by promoting 3R+W (reduce / reuse / recycle + waste management). Specifically, we are steadily promoting initiatives in venous industries. This includes the reuse and recycling of store facilities and fixtures, the expansion and increase in sophistication of metal scrap and waste treatment through the use of a nationwide network of recycling companies.
Energy & Chemicals Company
Ensure Stable Procurement and Supply		Plastic	Efforts leading to solutions to social problems	Plastic-related environmental response	We will contribute to solving social problems (e.g., marine plastics and waste plastics) that urgently require measures with a plastic-related environmental response.	Supply environmental materials and establish a recycling/reuse program in collaboration with brand owners.	Build a recycling-oriented-model by enhancing our handling of environmental materials and establishing a recycling/reuse program.	We have worked with Japanese brand owners to introduce PCR (Post Consumer Recycled) polyethylene and polypropylene resins supplied by recyclers mainly in China and Southeast Asia into their cosmetic and sanitary containers.
Food Company
Ensure Stable Procurement and Supply		Pollution Prevention and Resource Recycling	Supply and use of environmentally friendly resources and materials	Fresh food field	Through the reduction of food loss, we will contribute to the promote the effective use of the resources and reduce the environmental impacts.	The company will brand and commercialize the out-of-spec Dole bananas discarded in Japan and Philippines as Mottainai bananas and distribute them in the market again.	Reduction of waste at the production site (Philippines) Reuse of discarded bananas (Japan)	Result in FYE 2025 Reuse of waste bananas in Philippines: 25,003 tons The consumption volume of discarded bananas in Japan: 2,045 tons Thanks to the utilization of off spec banana and the expansion of "Mottainai" project, the reuse volume was increased compared with last fiscal year.
Ensure Stable Procurement and Supply		Pollution Prevention and Resource Recycling	Reduction of food loss, promotion of recycling	Overall food-related businesses	We contribute to the realization of a circular economy by promoting food loss reduction throughout the entire supply chain in the food distribution sector.	Promoted measures to reduce food loss in the domestic wholesale business. The company has implemented improvement measures based on the policies of “no food loss,” “sell out products,” and “donate food products”.	In the domestic wholesale business, in addition to strengthening inventory management through the use of IT technology, the company contributes to the reduction of food loss by utilizing its domestic sales network and donating to food banks.	We are on track to achieve its FYE 2031 target, with a 4.7% y/y reduction as of the end of FYE 2025, and a 36.5% y/y reduction by the end of FYE 2025 compared to FYE 2017. We adjusted supply and demand based on retail store sales data and order data, and also increased the volume of products donated to food banks.
General Products & Realty Company
Address Climate Change (Contribute to a Decarbonized Society) Ensure Stable Procurement and Supply		Capital Introduction Pollution Prevention and Resource Recycling	Taking countermeasures against climate change	Cement substitute material such as slag	We plan to expand the use of sustainable byproducts (slag) as a substitute material for the cement which is vital for construction and civil engineering.	Establish continuous, stable business between Steelworks as the supplier of slag and users.	Consider investment, participation, etc. in the slag business and focus initiatives on creating demand, especially in developing countries, with the aim of establishing continuous, stable business.	We are currently in discussions concerning investment and participation in the slag business. In FYE 2025, global slag transactions will amount to 1.45 million tons.
ICT & Financial Business Company
Ensure Stable Procurement and Supply		Pollution Prevention and Resource Recycling	Provide products/services that support the realization of a sustainable lifestyle.	Reuse / Recycling Business	Contribute to the development of a sustainable society by making most of limited resources through the distribution of used mobile phones and tablets in the Japanese market.	Expand supply channels in order to realize a sustainable and stable procurement of resources. Reinforce promotional activities in order to raise the awareness of secondhand mobile phones/tablets.	Expand product variation and supply channels. Expand distribution outlets.	Product Handling Models: Increased from 856 models in FYE 2024 to 947 models in FYE 2025. Procurement Sources: Maintained at 12 companies from FYE 2024 to FYE 2025. Distribution Channels: Expanding sales channels through major e-commerce operators in addition to our own e-commerce site.

Structures and Systems

Governance

ITOCHU’s governance structure and systems to manage environmental and social risks, including pollution prevention and resource recycling, are as follows.

Refer to: Governance

Evaluation of Pollution Prevention and Resource Circulation in New Business Investment Projects

For business investment projects that ITOCHU undertakes, the impact of the project on society and environment is evaluated in advance using the ESG Checklist for Investments, a checklist that must be submitted when entering into new business investment projects. For example, it includes monitoring the status of pollution prevention and resource circulation. The project is then only undertaken upon confirming that there are no problems in the results of those investigations.

We consider ensuring stable procurement and supply to be a material sustainability issue. We work to effectively utilize and to ensure stable procurement and supply of resources according to demand in each country with consideration for the environment (e.g., biodiversity). In doing this, we are aiming for a circulating society.

Assessment of Pollution Prevention and Resource Circulation at ITOCHU Group

ITOCHU has been conducting annual on-site investigations for ITOCHU Group companies having relatively high environmental impacts since 2001 to strengthen our environmental risk management. Throughout the assessment, we engage with the senior management team to assess the company’s status of exhaust and wastewater, chemical handling, and waste disposal.

Assessment of Efforts on Pollution Prevention and Resource Circulation in the Value Chain

Assessment of Sustainability Risk in Products ITOCHU Handles

ITOCHU conducts a sustainability risk assessment for each new product we will handle. We use LCA^* analytical methods to evaluate the impact the product will have on the environment and society, compliance with environmental laws and regulations, relationships with stakeholders, and more. This evaluation covers the stages of the product from the procurement of its raw materials to its manufacturing, use and disposal. If there is a significant nature-related risk in the value chain, such as environmental pollution or resource depletion, we subject that product to priority management. We then formulate and implement various regulations, procedure manuals, education on the specific work operational factors, and other measures.

Life Cycle Assessment (LCA): This is the technique to assess the impact of one product on the environment in all stages of its lifecycle — from raw materials to manufacture, transportation, use, and disposal or reuse.

Sustainability Surveys for Suppliers

Each Company at ITOCHU and applicable ITOCHU Group companies select important suppliers based on certain guidelines, including high-risk countries, handled products, and handled amounts, to grasp the status of our suppliers. Those in charge of sales at each Company and those in charge at overseas subsidiaries and Group companies visit those suppliers and interview them. Those in charge also conduct sustainability surveys with questionnaires on important suppliers. We check the situation of initiatives for exhaust, wastewater, and waste treatment, and resource recycling efforts including energy and raw material conservation. We make continuous improvements by asking suppliers to address issues as necessary.

Management of Chemical Substances

The chemicals handled in the Chemicals Division are those that have potentially serious impacts on human health and the natural environment and have become subject to various laws and regulations that aim to ensure appropriate handling across the supply chain – including during manufacturing, sales, transportation, and storage. Furthermore, the appropriate management of chemicals is crucial from a business perspective for ITOCHU’s Chemicals Division as well as violations and cases of non-compliance can impact the regulatory approvals we require on certain products.

There is an international trend to minimize risks at every level of the entire supply chain of chemicals. Against this background, both advanced nations and developing nations have started to introduce new regulations and to make large-scale revisions to existing regulations. Consequently, the regulatory environment in the handling of chemicals is expected to become ever stricter in the future.

We recognize the importance of compliance with laws and ordinances in addition to knowledge of products and the industry as a company that handles chemicals. Our basic policy is that each individual should engage in business in accordance with the requirements of laws and ordinances upon correctly understanding the laws and regulations concerning the products that they are in charge of handling.

Compliance with Laws and Regulations in the Divisions Handling Chemical Substances

Handbook on chemical-related regulations (cover page image)

At ITOCHU, the Chemicals Division has cross-functional oversight of our management of chemical substances. This includes oversight of the sales departments that handle chemical substances, which sit within the Chemicals Division, as well as relevant subsidiaries that handle chemical substances. In addition, the Chemicals Division has oversight of any sales divisions and subsidiaries outside of their direct control if chemical substances are used.

We strive to comply with laws and regulations through a management method based on a combination of thorough inquiries to specialized external consulting organizations and the use of a centralized management system to track environmental legal compliance. The management system was developed internally in 2016 and allows us to confirm and record applicable laws and measures at the chemical substance level for each product. We also provide training and educational opportunities to relevant sales staffs, supplemented by e-learning materials and handbooks that summarize the main points of relevant laws.

The external consulting organization that we currently employ for chemical substance management is Techno Hill Co., Ltd. Techno Hill has comprehensive knowledge regarding the field of chemical substances and provides us with informed advice on management systems, applicable laws and regulations for each product, and general trends movements in the industry.

In order to maintain and improve the abilities of each person in charge at a high level, we distribute its own handbook on chemical-related regulations to all persons in charge. There are 32 laws and regulations covered in this handbook, each of which outlines important aspects of compliance requirements. The purpose of this handbook is to educate our employees, especially new recruits and sales personnel, on the laws and regulations specific to the chemical industry.

By taking these initiatives, in FYE 2025, there were no major violations caused (e.g., license suspensions).

Management Structure for Emergency Response and Accident Response

ITOCHU responds as below in accordance with our accident and emergency response regulations.
If an accident occurs during the handling or storage of toxic or hazardous substances, we respond as follows in line with the manual.

We will make reports as necessary according to the emergency contact network. In addition, we will take prompt action to limit the risks caused by toxic and hazardous substances.
In the event of splashing, leaking, outflow, seepage or penetration underground, we will immediately notify the health care center, police station or fire department to that effect when there is a fear of a risk to the health of an unspecified or large number of people. At the same time, we will take measures to prevent risks to health.

Initiatives

1. Reduce

Initiatives to Introduce Environmentally-friendly Packaging in FamilyMart Stores

FamilyMart Co., Ltd., a subsidiary of ITOCHU, has set goals of increasing the ratio of environmentally-friendly containers and packaging^* to 60% by 2030 and 100% by 2050, as part of its efforts to curb plastic use in FamilyMart Environmental Vision 2050.

By changing the specifications of containers and packaging, FamilyMart is working to reduce the amount of petroleum-based plastics used in the raw materials of containers and packaging and to promote the use of environmentally-friendly materials. We will continue to work toward achieving our 2030 and 2050 targets with the understanding and cooperation of our suppliers and consumers.

Containers and packaging made from materials including plant-based biomass plastics and recycled PET

Major Initiatives in Environmentally-friendly Packaging

Details of Initiatives	Reduction in Use of Plastics
Promote the switch to 100% recycled PET bottles made from recycled PET resin for Famimaru’s bottled beverages. This includes the seven staple unsweetened tea products such as green tea, barley tea, and rooibos tea, as well as containers for natural water and coffee.	Estimated reduction of about 4,750t per year
All salad containers are made of environmentally-friendly materials such as biomass plastic.	Reduction of about 900t per year
Reducing the weight and changing the materials of chilled bento and sushi containers are expected to result in reduction.	Estimated reduction of about 421t per year
Change the main container of the soup to paper-based materials	Estimated reduction of about 170t per year

Effort to Reduce Plastics at Convenience Stores

In accordance with the Act on Promotion of Resource Circulation for Plastics that went into effect in April 2022 in Japan, FamilyMart has set a goal of reducing the amount of petroleum-based plastics use by FYE 2031 by 50% from FYE 2020 level, and is working to reduce the amount of plastic spoons, straws, and other items distributed to customers who purchase boxed lunches, desserts, beverages, and other items.

Results of Major Initiatives to Reduce the Use of Certain Plastic Products

Start Year	Details of Initiatives	Reduction in Use of Plastics
2021～	Design of the handle of the plastic spoon was changed.	Reduction of about 12% per year. Estimated reduction of about 65t per year
2022～	FamilyMart launched the "Convenience Wear Blue Green" project to sell products made with environmentally-friendly materials, such as washable and reusable cutlery sets, open-and-wash straws, and spoons and forks made with biodegradable biopolymers.	-
2022～	Discontinuation of providing plastics forks as a general rule. (If requested, chopsticks are offered as an alternative or forks can continue to be provided)	Estimated reduction of about 250t per year
2024～	Partial implementation of charging for spoons, forks, and straws in some stores.	Estimated reduction of about 4t per year

Initiatives to Reduce Food Waste in Convenience Stores

A discount sticker featuring a teary-eyed character pleading “Please save me”

FamilyMart Co.,Ltd. is working to reduce food waste by promoting the active sale of near-expiry foods through discounted sales (FamilyMart’s Eco Discount) for ready-to-eat products such as rice balls and bento boxes. Starting in March 2025, FamilyMart is gradually changing the discount stickers nationwide from those displaying only the price to designs featuring teary-eyed characters and messages.

The results of a demonstration experiment conducted since October 2024 showed that changing the sticker design increased the purchase rate of discounted products by 5% points. If this approach is expanded to stores nationwide, it is expected to reduce food waste in stores by approximately 3,000 tons annually.

Going forward, FamilyMart will continue to actively promote new initiatives to reduce food waste by using behavioral psychology to approach consumers' awareness and emotions regarding food waste, encouraging changes in purchasing behavior.

Develop Environmentally-friendly Garbage Bags “nocoo”

Sanipak Company of Japan Ltd., a subsidiary of ITOCHU, has developed “nocoo” environmentally-friendly garbage bags that reduce CO₂ emissions. The use of natural lime stone as a raw material for nocoo reduces plastic use by approximately 20% and reduces CO₂ emissions during the manufacture and combustion of garbage bags by approximately 20% compared to 100% polyethylene garbage bags. In FYE 2025, sales of nocoo in the 47 prefectures of Japan totaled 6,316 tons, contributing to a reduction in plastic use of 1,515 tons and a reduction in CO₂ emissions (when incinerated) of 4,100 tons.

With nocoo, we will continue to address environmental issues that are familiar to everyone, such as reducing CO₂ emissions through regular garbage disposal.

Refer to: nocoo website(Japanese only)

2. Reuse/Recycle

RENU® Project Aims to Realize Circular Economy

“RENU,” recycled polyester made from textiles waste

In the spring of 2019, ITOCHU launched a project called the RENU^® project (“RENU”), which aims to address the issue of excessive waste in the fashion industry and realize circular economy. As its first product, we are developing recycled polyester made from textiles such as waste leftover fabric and used clothing. We will contribute to realize circular economy by developing this project through the entire supply chain of the fashion industry from raw materials to consumers.

Refer to: RENU^® project website

The environmental impact of handling recycled polyester at RENU project is as follows.

	FYE 2021	FYE 2022	FYE 2023^*	FYE 2024^*	FYE 2025^*
Feedstock equivalent to T-shirt (million pieces)	3.5	6.0	6.3	6.5	5.5
Reduced CO₂ (t)	521	893	1,931	2,010	1,715
Reduced Water (kL)	875	1,500	6,500	6,760	5,770

Adopted LCA (FYE 2022 version)

Expansion of the Textile Collection Service for a Circular Economy

ITOCHU and ECOMMIT Co., Ltd., which develops resource circulation businesses through reusing and recycling, have signed an agreement to expand the textile collection service “Wear to Fashion” in the Japanese market. Starting spring 2022, the service will gradually be offered to all companies and local governments in Japan. As of March 2025, ITOCHU is collecting textiles from about 4,300 locations. We plan to collect approximately 8,900 tons of textiles in FYE 2026.

Additionally, utilizing the distribution infrastructure of the ITOCHU Group, a demonstration experiment was conducted from December 2024 to June 2025, where dedicated collection boxes for the resource circulation service "PASSTO" operated by ECOMMIT were installed in ten FamilyMart stores in Tokyo.

With this new initiative as a part of the RENU Project aimed at solving a problem in the textile and fashion industries, textile products coming out of various sites will be collected and sorted through combining our network in the textile and fashion industries and ECOMMIT’s system from collection to resource circulation. Reusable products will be reused utilizing ECOMMIT’s knowledge, and recyclable polyester products will be made into RENU. In doing so, the amount of discarded textile products will be reduced as much as possible and aims to realize a circulating economy.

Overview of the “Wear to Fashion” service

ARChemia Project, a Recycling Project for Used Plastics and Textiles

In March 2023, ITOCHU signed a memorandum of understanding with Resonac Corporation regarding a joint study aimed at promoting a used plastic and textile recycling business. Based on this memorandum, we launched the ARChemia Project and began a collaboration to supply Resonac with recycled solid raw materials containing a mix of used plastics and textiles known as RPAF^*1 and turn it into chemical products such as low-carbon ammonia with high environmental added value. We aim to increase the supply of RPAF to 10,000 tons in FYE 2028. Through the ARChemia Project, a joint project between chemicals and textiles, we will solve the social issue of waste and contribute to the development of circulating society.

RPAF: Refuse derived Plastics paper and Apparel densified Feedstock
A solid raw material for gasification-based chemical recycling adjusted for calorie generation, made mainly from used plastics, used paper and used textiles.
KPR Plant: Kawasaki Plastic Recycling Plant of Resonac

The Recovery of Nylon Waste to ECONYL® Nylon Products

Fishing nets used as raw material for ECONYL

ITOCHU and Aquafil S.p.A. have concluded capital and business alliance to promote and expand the businesses of circular nylon production.

Nylon is used for textiles and plastic materials made through petrochemistry in a range of fields such as fashion, carpeting, fishing nets, food packaging, and automobiles. However, many products use nylon blended with other materials in a compound form, making it a difficult material to be recycled.

In 2011 Aquafil created its ECONYL^® Regeneration System that turns recovered nylon waste such as fishing nets, carpets and post-industrial waste back to caprolactam (CPL), a crude raw material. Through its proprietary chemical recycling technology, Aquafil eliminates impurities completely, to achieve regenerated nylon product having the same features of the virgin quality materials. ECONYL^® nylon is made completely from waste, which enables up to 90% CO₂ reduction compared to conventional nylon made from petroleum.

We will leverage on its ITOCHU Group’s diverse network and expand sales for applications in apparel, carpeting, automobiles, and packaging materials. In February 2022, YKK Corporation, which is a global leader in the manufacturing and sale of zippers, Aquafil and we are jointly developing environmentally-friendly recycled zippers and recycled buttons. In March 2024, we jointly developed fishing nets using ECONYL with Momoi Fishing Net Mfg. Co., Ltd. and Kinoshita Fishing Net Mfg. Co., Ltd. In October 2024, we announced a collaboration with Asahi Kasei Corporation to develop resin-based materials for 3D printers using ECONYL as the base polymer. By combining ECONYL with plant-derived raw materials, which Asahi Kasei has been developing, we will provide environmentally friendly materials to the market.

Moreover, we plan to enforce Aquafil’s nylon recovery scheme using its existing sales chain and will also implement the Partnership from the perspective of the stable supply of raw materials to Aquafil. Through its collaboration from the recovery of waste to the sale of Aquafil’s products, we aim to expand the businesses of nylon circularity.

Development of Environmentally-friendly Flooring and Launch of Flooring Material Recycling Business

Office image utilizing “DESSO,” eco-friendly flooring material

ITOCHU has launched the recycling business for flooring material together with the launch of DESSO, an eco-friendly flooring material produced by European construction material manufacturer Tarkett S.A., in the Japanese market in cooperation with Lilycolor CO., LTD., an interior design and decorating wholesaler.

Its new DESSO is an environmentally-friendly product based on recycling that enables the fiber surface part of the flooring material to be separated from the base material of the floor, making it possible to recycle the components. Since the start in 2024, DESSO has been adopted in dozens of properties.

This project aims not only to sell DESSO but also to contribute to the expansion of flooring material recycling through this collection and recycling scheme.

DAILITE, an Inorganic Board Utilizing Unused Resources and By-products

Daiken Corporation, a subsidiary of ITOCHU, developed DAILITE, the world's first new industrial material utilizing an unused resource Shirasu (volcanic ash) and a by-product of steel production Slag Wool, and started selling it in 1997. It offers performance characteristics such as lightweight, high strength, fireproof, breathability and good workability.

DAILITE combined with sheets and sliced veneer for surface decoration is used as the non-combustible and well-designed wall materials and louver materials. In addition, DAILITE has been adopted as a bearing surface for wooden houses, with a cumulative total of approximately 1.05 million homes as of the end of March 2023, according to Daiken's estimates.

In recent years, as the use of domestic and locally sourced timbers has been promoted in public buildings and other structures, the needs to use woods for interior wall and ceiling materials that required nonflammable properties is increasing. In this trend, Daiken have collaborated with locally sourced timbers from Tokyo and nine prefectures (as of May 2024), and non-combustible decorative panels and louver materials that combined DAILITE with locally sourced timbers are used in public facilities, station buildings, etc. Through the utilization of locally sourced timbers, the company contributes to the revitalization of local forestry.

Daiken will continue to develop products that contribute to sustainable resource circulation.

Raw materials: Volcanic Ash and Slag Wool

Ceiling: GLAVIO LOUVER, a non-combustible louver made of DAILITE base material
Wall panel: GLAVIO, a non-combustible panel made of DAILITE base material

Exterior wall underlayment: DAILITE MS, a bearing surface for wooden house

The License Business of Polyester Chemical Recycling Technology

ITOCHU, Teijin Limited, and JGC Holdings Corporation have established a joint venture company, RePEaT Co., Ltd., to license technology for the chemical recycling of polyester products in January, 2023. In FYE 2026, the first licensed factory is scheduled to be completed in China with a capacity of 50,000 tons per year.

In response to urgent needs to counter global warming, the fiber and textile industry is working on measures, including the establishment of ecosystems for resource recycling, to address issues such as CO₂ emissions from manufacturing processes and the mass disposal of used clothing. Currently, disposed textile products are used as a heat source (thermal recovery) or as raw materials for the production of other products (material recycling). Chemical recycling, however, is a revolutionary method of chemical decomposition for textile recycling that turns used textile products into new textile raw materials.

RePEaT will license recycling technology by taking advantage of Teijin’s proprietary chemical recycling technology, the expertise of JGC derived from its global engineering business, and our extensive network of textile industry players. Customers in Japan and other countries are expected to launch the cost-effective chemical-recycling business for the production of polyester materials.

In addition, RePEaT will provide consulting services to help customers establish ecosystems that collect used polyester fiber products for reuse as raw materials, thereby contributing to a more sustainable world through recycling.

Providing One-Stop Waste Management Services

Franchise companies with nationwide operations have traditionally disposed of waste on a small and decentralized scale on a store or area of franchise system basis, resulting in issues such as inefficiencies in labor and costs for each business and the risk of legal violations.

ITOCHU Metals Corporation (IMC) has established a recycling network centered on the ITOCHU Tetsugenkai, which consists of more than 100 excellent recycling companies nationwide, and provides a centralized management service, including IMC's own electronic manifest system, until waste is disposed of and recycled. This system helps to significantly reduce the risk of legal violations and disposal costs for waste generators, as well as improving recycling rates.

IMC currently provides a variety of services to support the initiatives of companies in various industries, including convenience stores, store fixture manufacturers, and beverage manufacturers, by offering a cross-industry recycling platform. In addition, IMC realizes the 3Rs by reusing waste materials that can be reused from the waste materials IMC is entrusted to manage at its maintenance sites, thereby contributing greatly to the formation of a circulating society.

Leading UK for Collecting and Recycling Casing Tyres

PRO-gran crumb rubber made by casing tyres

Murfitts Group Ltd, a company under ITOCHU subsidiary European Tyre Enterprise Limited, collects and processes casing tyres in the UK each year. Using the recovered material, it manufactures a range of recycled products such as rubber crumb products for sports surfaces, pathways, children’s playgrounds, carpet underlay, modified asphalt, and many other industrial applications. Its products are exported to markets across the globe.

Murfitts also has been developing and commercializing a proprietary pyrolysis technology, which decompose the tyre feedstock at high temperatures in a vacuum in order to recover various high-value materials such as carbon black and recycled fuel oil. This technology will help promote sustainability initiatives in the tyre industry by replacing one of major raw materials of tyres, carbon black, with a recycled product.

The Cooperative Development of Material Recycling Technology for Multi-layer Film Packaging

ITOCHU has entered into an agreement for cooperative development of material recycling technology for multi-layer film packaging with artience Co., Ltd. (former Toyo Ink SC Holdings Co., Ltd.)

In 2019, artience developed a technology to separate the ink, adhesive, etc. that make up the multi-layer film or packaging in cooperation with the world’s largest environmental solutions company. A demonstration pilot plant started operation at the end of 2022, and, moving forward with LCA appraisals, cost simulations, and other verifications. artience plans to start a post-industrial recycling business, and aim to start the business under commercially conditions as soon as possible. In addition to acquiring exclusive marketing rights in Japan and first refusal rights in Asia and Europe related to major product materials related to this technology, we will widely provide environmental solutions to food and consumer products company, retailers, brand owners, and more through requests to build structures for material recycling using this technology and to design recyclable, environmentally-friendly packaging.

Through this initiative, both companies will make currently un-recyclable multi-layer film packaging into a recyclable product, aiming for a more than 40% material recycling rate in Japan and abroad.

3. Renewable

Number One Trader in the World for the Cement Substitute of Blast Furnace Slag

Blast furnace slag is a by-product of the steelmaking process. As its property is similar to a cement, a blast furnace slag can substitute a cement. The benefits of using a blast furnace slag are, firstly, that it helps us save natural resources (e.g., limestone – the raw material of cement) and, secondly, that it enables us to cut CO₂ emission coming from cement manufacturing process. About 840kg of CO₂ is reduced when a ton of cement is produced with using blast furnace slag.

ITOCHU has been selling blast furnace slags from Japan and other countries to all over the world for over 20 years and volume-wise, we are the No.1 independent blast furnace slag trader. As there is more call for carbon neutrality globally, a blast furnace slag will be needed even further. Our mission is to develop and keep a stable supply chain of blast furnace slag to end users and be a part of the global decarbonization efforts.

Collaboration to Introduce Renewable Biomass Polypropylene in the Japanese Market

Japan has formulated a basic strategy to introduce approximately two million tons of biomass-based plastic products by 2030 as a countermeasure against ocean plastic waste and climate change.

Since the agreement in 2020 with Borealis AG regarding the marketing of biomass polypropylene (bio-PP) derived from renewable resources in the Japanese market, ITOCHU has been working in collaboration with ITOCHU PLASTICS INC. to advance the deployment of food containers and packaging materials made from plant-derived resins with a market-oriented perspective. Specifically, since June 2021, we successfully had FamilyMart initially in Japan begin replacing some of its pasta containers made with bio-PP. We are also working on product development in various fields, primarily focusing on food containers, hygiene products, and daily necessities.

We have obtained ISCC PLUS certification for the domestic sales of synthetic resins derived from biomass resources manufactured by the mass balance method. This certification proves sustainable raw material procurement in a way that can be traced through the supply chain, and the portion of biomass raw material contributes to greenhouse gas (GHG) emissions reduction.

Collaboration with Outside Initiatives

Compliance with the Containers and Packaging Recycling Law

ITOCHU understands our own manufacturing and import volume of containers and packaging every year to recycle containers and packaging. We then pay a recycling fee to the Japan Containers and Packaging Recycling Association. The aim of this is to contribute to promoting the formation of a circulating society as a specified business operator prescribed by the Containers and Packaging Recycling Law.

The Recycling Fee We Pay Every Year

(Unit: Yen)

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Fiscal Year		FYE 2019			FYE 2020			FYE 2021			FYE 2022				FYE 2023
Recycling Fee/ Contribution Fee		Recycling	Contribution	Total Amount	Recycling	Contribution	Total Amount	Recycling	Contribution	Total Amount	Recycling	Contribution	Total Amount	Weight (t)	Recycling	Contribution	Total Amount	Weight (t)
Glass Bottles	Colorless	750,030	0	750,030	813,659	0	813,659	925,650	0	925,650	1,145,967	0	1,145,967	236.752	1,022,254	0	1,022,254	201.599
	Brown	-	-	-	-	-	-	-	-	-	-	-	-	0	114,234	0	114,234	13.314
	Other Colors	-	-	-	-	-	-	-	-	-	-	-	-	0	-	-	-	0
PET Bottles		-	-	-	-	-	-	-	-	-	630	0	630	0.084	-	-	-	0
Paper Containers and Packaging		9,045	27	9,072	15,288	4	15,292	10,168	0	10,168	15,453	0	15,453	1.385	7,654	0	7,654	0.788
Plastic Containers and Packaging		1,197,091	0	1,197,091	1,463,900	4,537	1,468,437	2,432,519	0	2,432,519	2,739,244	0	2,739,244	52.383	2,167,099	0	2,167,099	41.583
Total		1,956,166	27	1,956,193	2,292,847	4,541	2,297,388	3,368,337	0	3,368,337	3,901,294	0	3,901,294	290.604‬‬‬‬‬	3,311,241	0	3,311,241	257.284

Food Recycling

ITOCHU makes regular reports on the amount of food we discard and the amount we recycle in Japan to comply with the Food Recycling Law. We are striving to suppress the generation of waste and to promote recycling (e.g., conversion into feed) in line with the reference rate (recycling rate target).

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Food Recycling Rate
		FYE 2021	FYE 2022	FYE 2023	FYE 2024	FYE 2025
Quantity recycled	Amount of food waste generated (Unit: t)	1,125.8	955.9	939.4	1,944.3	813.6
	Amount of recycling (Unit: t)	775.5	762.0	854.6	1,747.6	759.4
	Amount of disposal (Unit: t)	350.3	193.9	84.8	196.7	54.2
Target (recycling rate target by individual food related operator)	Reference rate	79.8%	80.8%	80.8%	80.8%	80.8%
Percentage recycled	Recycle rate^*1	68.9%	81.9%	91.0％	89.9%	93.3%

Recycle rate is calculated as in below formula defined by the Ministry of Agriculture, Forestry and Fisheries.
(Amount of suppressed waste (vs FYE 2008) + Amount of recycling + Amount of heat recovery × 0.95 + Amount of weight reduction)/(Amount of suppressed waste (vs FYE 2008) + Amount of waste food generated)

FYE 2026 recycling rate target: 80.8％

Initiative Participation (Activities Through Business and Industry Groups)

ITOCHU is participating in the Global Environment Subcommittee of the Committee on Environment and Safety – an environment and energy related committee of the Japan Business Federation (Keidanren). We are working to realize an environmental policy compatible with the economy (e.g., through promotion of voluntary action plans, and measures for global warming, waste and recycling and environmental risks including water management). We are also participating in the Environment Working Group of the Japan Foreign Trade Council. We are striving to build a decarbonized society, construct a circulating society, and to support environmental related laws and regulations. The goals set by the Environment Working Group are as follows.

Reduction Target for FYE 2026 in Domestic Business Activities (Trading Company Industry)

Disposal Amount: Reduce 82% compared to FYE 2001
Generation Amount: Reduce 62% compared to FYE 2001
Recycling Rate: 83% or more