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Address to Climate Change

The JAL Group recognizes that responding to climate change is a particularly important issue for the sustainability of society. As part of responsibility of air transport operators, the Group announced at the general shareholders' meeting held in June 2020 that we will aim to achieve net zero CO2 emissions by 2050 in order to steadily implement measures to address to climate change, including reduction of CO2 emissions. In February 2021, the JAL Group committed support to the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) of the Financial Stability Board (FSB). Hereafter, information related to climate change in line with the TCFD recommendations will be disclosed.

Governance

In order to treat climate change-related "risks" and "opportunities" as important management issues, JAL has established the Sustainability Promotion Council headed by the president as the Chair, and Sustainability Promotion Committee under the council for deliberation and decision. The contents are reported to the Board of Directors for discussion and evaluation. In accordance with evaluation of the effectiveness by the Board of Directors, it has been resolved that the Board of Directors will deepen discussions on sustainability, including climate change. The JAL Group will strive to make continuous improvements by periodically evaluating the impact of our business to the environment and results of disclosed initiatives towards climate change and by implementing the PDCA cycle to reflect to the initiatives.
We revised the JAL Group Environmental Management Regulations in November 2020 and are accelerating our response to climate change by establishing and operating the Environmental Management System (EMS).
Furthermore, in the area of sustainability in general, 4 areas, 22 issues, and approximately 180 initiatives to resolve social issues through our business have been identified, and the JAL Group as a whole is promoting ESG management to achieve SDGs.

Basic Concept

We have established the Environmental Policy and have built a promotion system based on this policy. As a member of the society, we work to preserve the environment and prevent events that interfere the preservation.

Environmental Management

We have established, implemented and maintained the Environmental Management System (EMS). We are making continuous improvements and promoting environmental conservation activities appropriately and efficiently.

Strategy

Scenario Analysis

In 2018, the JAL Group participated in the "Support Project for Scenario Analysis of Climate Risks and Opportunities in Accordance with TCFD" supervised by the Japanese Ministry of the Environment (MOE), and with reference to the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC), we set 2 scenarios for the average rise in temperature to the end of this century of "below 4℃" and "below 2℃", and looked at society in 2030.

Since COVID-19's global outbreak, the international community has begun to move toward a world with the 1.5℃ scenario. This includes deepening of the Green Recovery Program in Europe, return to the Paris Agreement of the U.S., China’s net zero CO2 emissions declaration by 2060, and the Japanese government's 2050 carbon neutral declaration and major revisions to the NDC (Nationally Determined Contribution).
In the aviation industry, ICAO (International Civil Aviation Organization) is currently studying a long-term CO2 reduction target for 2050 based on the social demand for decarbonization. In view of the fact that CO2 emission regulations in each country will be tightened and emissions trading will become more active in the future, the JAL Group decided to aim to realize a world with a 1.5 ℃ scenario, set a net zero CO2 emissions target for 2050. We have incorporated it into the "JAL Group Medium-Term Management Plan 2021-2025", which was announced on May 7, 2021, to accelerate responses to climate change.

Risks and Opportunities

Climate change has the potential to adversely affect the air transport business, which is based on the premise of operating in a "safe and secure society," and as a result, poses a significant risk to the sustainability of the business. In addition, addressing to climate change such as CO2 emission reduction by airlines may have a variety of financial impacts, including upgrading to fuel-efficient aircrafts and compliance with carbon pricing.
These factors affecting the JAL Group's business are summarized and discussed in accordance with the TCFD portfolio of climate change-related risks and opportunities, and are listed in the table below. "Short-term," "Medium-term," and "Long-term" are defined as follows.

  • Short-term: Fiscal years 2021-2025 (applicable period of current Medium-Term Management Plan)
  • Medium-term: Fiscal years 2026-2030 (Period until achievement of the SDGs)
  • Long-term: Fiscal years 2031-2050 (Period until the JAL Group’s achievement of net zero CO2 emissions)

Risk Management

The JAL Group defines risk as event or acts that impede the achievement of the organization's mission, objectives and goals, and conducts risk surveys and assessments every six months. Priority is placed on those risks that are judged to have a significant impact against the JAL Group, and implements the PDCA cycle with the Group Risk Management Committee, headed by the president as the Chair, to take the lead.
Recognizing the risk of climate change as one of our priority risks, risk management is conducted in accordance with global laws, regulations and policy trends related to climate change, while identifying risks in the PDCA cycle of the Environmental Management System (EMS). They are reported to the Board of Directors for discussion and evaluation.

Risk Management System

The risk of climate change, both transition risk and physical risk, are managed within the risk management framework of the JAL Group as a whole.

Metrics and Targets

In order to pass on our precious Earth to next generation, the JAL Group has set targets for environmental data such as the amount of CO2 emissions, waste and water consumption, and discloses the results.

At the general shareholders' meeting held in June 2020, the company set a target of net zero CO2 emissions by 2050 and incorporated the acceleration of its response to climate change into the 2021 -2025 JAL Group Medium-Term Management Plan.
Due to the nature of the air transportation business, direct emissions from aircraft account for approximately 99% of the JAL Group’s total CO2 emissions. Therefore, the Group will first focus on reducing CO2 emissions from aircrafts, it will also set aggressive targets in reducing CO2 emissions from ground facilities and take sincere measures.
Although the road to delivering this vision is not easy, we will lead the industry in leading-edge initiatives in line with the Japanese government's Green Growth Strategy, in accordance with the international framework for CO2 reduction, while strengthening cooperation and collaboration with various domestic and overseas stakeholders.

Scenarios towards net zero CO2 emissions by 2050

Regarding the reduction of CO2 emissions from aircraft, its scenarios by 2050 in considered, referring to the latest study materials by ICAO and IATA, and the latest scenarios such as ATAG*1's "WAYPOINT 2050"*2, and proceeding to a discussion of future issues and measures to be taken.

*1 ATAG(Air Transport Action Group) Global Coalition to Promote Sustainability in aviation industry
*2 Waypoint 2050Open link in a new window

Premises for creating scenarios to achieve net zero CO2 emissions for the JAL Group

The growth of RTKs (revenue ton-kilometers) based on total demand for both international and domestic routes was set, and total CO2 emissions up to 2050 was calculated, reflecting the 3 points below.

Targets and Initiatives towards CO2 emission reduction by 2030

The JAL Group's target for 2030 to keep total emission below 90% level of that of fiscal year 2019 is one of the most ambitious targets for airlines around the world. The Group will strive to achieve our goals by steadily upgrading to the latest aircrafts based on stable financial base, reducing CO2 emissions in daily operations through the promotion of JAL Green Operations, and expanding SAF load.
As for SAF, manufacturing and distribution overseas is accelerating, and in Japan, the government's "Green Growth Strategy" laid out a concrete path to SAF manufacturing and distribution by 2030. The JAL Group has set an ambitious goal of replacing 10% of fuel loads by SAF in 2030, and will work on SAF commercialization  in cooperation with stakeholders in Japan and overseas through public-private partnerships.

Concrete initiatives and information disclosure (aviation)

Upgrading to fuel-efficient aircrafts

In September 2019, the Airbus A350 entered service on domestic routes, and in October 2019, the Boeing 787, which had been in service on international routes since 2012, entered service on domestic. These aircrafts are fuel-efficient and produce less noise, and can reduce the amount of CO2 emissions by 15% to 25% compared with conventional aircrafts.
Utilizing funds raised in public equity offering in 2020, the JAL Group will steadily continue to upgrade to fuel-efficient aircrafts in fiscal year 2021 and beyond.

Reducing CO2 Emissions in Daily Operations

Based on the fundamental premise of aviation safety's adherence to the principles, a variety of measures to reduce CO2 emissions are devised, including eco-flight initiatives by devising the timing and choice of handling during flight operations, reducing weight of aircrafts, and improving fuel efficiency through regular engine internal cleaning.
In addition, by promoting JAL Green Operations, a cross-organizational activity, which monitor the status of each initiative and share the progress within the company, thereby promoting the PDCA cycle to reduce CO2 emissions.

Supporting the Development and the Use of SAF

Aiming to be a leading airline in the use of SAF, the Group is working on a variety of projects, including the use in capital contribution of Fulcrum, a US-based SAF manufacturer, use of SAF produced in Japan for the first time in scheduled flights, and collaboration with partner companies to build supply chains for Japan domestic SAF.

Engaging in Emissions Trading

In addition to responding to the ICAO CORSIA, the Group also offers JAL Carbon Offset, in cooperation with Blue Dot Green Co., Ltd., as a unique initiative that allows passengers to offset their own CO2 emissions on their flights.

The JAL Group CO2 emissions by region

Topics

Disclosure regarding Climate Change of the JAL Group was selected as a good disclosure example in the TCFD Annual Report (see p. 49)

Concrete initiatives and information disclosure (ground facilities)

In the ground facilities field, initiatives with the goal of reducing unit energy consumption by 1% or more on average have been promoted. Under the "operator classification evaluation system" of Act on the Rational Use of Energy (Energy Conservation Act) implemented by Ministry of Economy, Trade and Industry, the Group has been certified by S Class good business operator classification for 6 consecutive years since 2015. In addition to reducing the volume of CO2 emissions in aviation and ground facilities, the Group is working to reduce the volume of CO2 emissions in the entire supply chain, including the volume of leftovers in inflight meals and lounges and food waste during cooking, as well as the volume of foodstuffs produced. We are also working to address to climate change in a variety of ways, including by cooperating with "the CONTRAIL Project", an aerial observation project.

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