Environment Performance Report

Environment performance report

30%

Honda is aiming to reduce the CO2 emissions intensity of motorcycles, automobiles and power products by 30% compared with 2000 levels by 2020, and is engaging in three initiatives to achieve this.

Basic Approach

Honda Environmental and Safety Vision/ Honda’s Environment Statement

Ever since the 1960s, Honda has actively endeavored to solve environmental problems.
We developed the low-pollution CVCC* engine that successfully reduced carbon monoxide, hydrocarbon and nitrogen oxide (NOx) emissions, while we were the world’s first automaker to comply with the U.S. Clean Air Act in the 1970s—a regulation thought at the time to be the most stringent in the world.

In 1992, Honda’s Environment Statement was released to serve as the Company’s guideline for all environmental initiatives. The statement articulates the basic stance we had developed until then to reduce environmental impact at every stage in the life cycle of our products, from product procurement to design, development, production, transportation, sale, use and disposal stages.

In addition, for Honda to further promote the above-mentioned environmental initiatives and continue to be a company that society wants to exist, the Honda Environmental and Safety Vision was established in 2011. Aimed at the realization of the joy and freedom of mobility and a sustainable society where people can enjoy life as is declared in this vision, each of Honda’s global business sites is engaging in the reduction of all kinds of environmental impacts from the aspects of both productionbased and corporate activities, beginning with Greenhouse Gas (GHG) emissions, which are considered to be a cause of climate change; use of resources, including water and minerals; and suitable processing and reduction of waste.

Honda will conduct these activities while sharing Honda’s Environment Statement with everyone associated with Honda—including suppliers and distributors in addition to Honda Group companies—in order to realize this vision.

* CVCC: Compound Vortex Controlled Combustion

Honda Environmental and Safety Vision


Realizing the joy and freedom of mobility and a sustainable society where people can enjoy life

Honda’s Environment Statement


As a responsible member of society whose task lies in the preservation of the global environment, the Company will make every effort to contribute to human health and the preservation of the global environment in each phase of its corporate activity. Only in this way will we be able to count on a successful future not only for our company, but for the world.

We should pursue our daily business under the following principles:

1. We will make efforts to recycle materials and conserve resources and energy at every stage of our products’ life cycle—from research,design, production and sales, to services and disposal.

2. We will make every effort to minimize and find appropriate methods to  dispose of waste and contaminants that are produced through the use of our products, and in every stage of the life cycle of these products.

3. As both a member of the company and of society, each associate will focus on the importance of making efforts to preserve human health and the global environment, and will do his or her part to ensure that the company as a whole acts responsibly.

4. We will consider the influence that our corporate activities have on the regional environment and society, and endeavor to improve the social standing of the company.

Established and announced in June 1992 Honda’s Environment Statement

Global Management

Environmental Management Promotion Structure and Management Cycle

Recognizing that environmental issues such as climate change and energy/resource issues, which require global responses, are material issues that impact Honda’s business operations, the Environmental Committee was established in 1991, chaired by the President and CEO and comprised members of company management. In 1995, the Committee became the World Environmental Committee and assumed responsibility for discussing and formulating plans for environmental protection activities worldwide. Since then, it had continued to meet every year as the World Environment and Safety Strategy Committee. From FY2018, environmental issues have been incorporated as items to be considered at the Sustainability Strategy Committee for integrated discussions under a single committee.

Medium- and long-term environmental policies and plans at the global level are formulated at the Meeting of the World Environment and Safety Strategy Committee on the basis of company-wide direction and medium- and long-term business plans. All committee members are involved in the meeting’s decision-making.

Following the decisions made at the above meeting, the World’s Six Region Environmental Committee, made up of the environmental divisions of each regional headquarters, also meets every year. Once the information sharing process at these meetings is over, these divisions formulate concrete action plans and then implement policy.

In terms of the progress of Honda’s environmental initiatives and the themes applicable worldwide, the Corporate Planning Supervisory Unit collects information from Regional Operations and reports it at the Meeting of the Sustainability Strategy Committee. The Company is striving to continuously enhance environmental management through the reflection of the above information in the medium-term business plan and policy for the following term and the implementation of the plan-do-check-act (PDCA) cycle by each Regional Operation and environmental division.

Environmental Management System

Honda’s existing global vehicle assembly and product assembly plants had acquired ISO14001, an international certification for environmental management systems (as of March 2018). Honda is in the process of obtaining certification for newly built plants. Therefore, coverage of environmental management systems is virtually 100%.

Current Status of Compliance with Environmental Regulations

In accordance with Honda’s Environment Statement, the Company has introduced environmental management systems at all business sites and in each division, and, along with promoting continuous efforts to improve environmental performance, it strives to comply with its own voluntary environmental standards, which are more stringent from an environmental perspective than any national or local regulations.

In the last five years, Honda has not committed any serious noncompliance with environmental laws and regulations, paid substantial fines/sanctions in breach thereof, or recorded any major chemical releases.

In addition, no environment-related complaints were received through the official complaint resolution program.

Environmental Accounting

Environmental Accounting in Japan

To facilitate efficient environmental management, Honda tabulates the cost reduction and profit attributable to its environmental protection activities, thus working to keep abreast of their economic impact.

Going forward, Honda is committed to continuing improvement of the accuracy of this data, which it sees as an indicator of corporate value, and as a tool for making environment-related management decisions.

Material Issues in the Environmental Dimension

Honda’s Material Issues

Through Honda’s proprietary technologies and business activities, the Company will work to deal with climate change issues, energy issues, effective utilization of resources and preservation of clean air, which are outlined as challenges in the materiality matrix, with an aim to realize a zero-environmental impact society in the future. In particular, Honda believes that dealing with climate change and energy issues and the effective utilization of resources are priority challenges in the environmental field.

Triple ZERO

Honda has introduced the Triple ZERO concept to unify its three “zeroing” efforts addressing “climate change issues,” “energy issues” and “efficient utilization of resources,” our most important challenges. The Company is striving to realize a society with an environmental impact of zero by engaging in its business activities based on this approach.


Zeroing CO2 emissions using renewable energy


To address “climate change issues,” Honda is striving to eliminate CO2 emissions in products and business activities in the future by utilizing renewable energy.


Zeroing energy risks


To address “energy issues,” Honda is striving to eliminate energy risks in the future, such as those caused by a dependence on fossil fuels.


Zeroing resource and disposal risk


To address the need for “efficient utilization of resources,” Honda is striving to eliminate risks across the entire product life cycle, from the resource procurement stage to the used product recovery and disposal stages.

Triple ZERO Approach

triple zero

Dealing with Climate Change and Energy Issues

Mitigating Climate Change and Energy Risk

Honda is moving forward with its response to climate change through initiatives that link Honda’s business strategy with its environmental strategy. With the vision of a zero impact society, in 2014 the Company announced its aim to cut total corporate CO2 emissions in half by 2050 compared with 2000 levels. Going forward, Honda will continue with activities to reduce CO2 using science-based target setting using the latest information. As an interim objective, Honda is currently working to achieve its 2020 Product CO2 Emissions Reduction Targets to lower CO2 emissions intensity from the use of motorcycles, automobiles and power products worldwide by 30% from the 2000 base year level.

In North America, Honda conducts credit trading with the portion exceeding the amount set forth in GHG and Corporate Average Fuel Economy (CAFE) laws and regulations and is working efficiently to reduce GHG while keeping an eye on the impact of this on business. The Company believes this is also connected to risk management in terms of rising fuel prices due to carbon pricing slated to come in effect in the future.

As automobiles account for approximately three quarters of Honda’s sales revenue, in pursuing the reduction of CO2 emitted from its products, Honda considers that reputational risk and potential penalties arising from failure to comply with fuel economy regulations can have a significant impact on its business. Accordingly, Honda has taken efforts to mitigate risks by applying a system called “SED” in which products are developed jointly by the Sales (S), Engineering (E) and Development (D) functions.
In addition, operations such as Honda R&D Co., Ltd., Automobile Operations and the Certification & Regulation Compliance Division coordinate research on trends in fuel economy regulations around the world, while the Certification & Regulation Compliance Division publishes the results as regulatory information. Regular meetings are held to provide a forum for sharing the contents and interpretation of new regulations, as well as for discussing the responses to them. Also, Honda has built an organizational structure for developing technologies that always anticipate future fuel economy regulations through engagement with policy makers.

In recent years, stakeholders have become increasingly conscious of fuel efficiency, CO2 emissions and other environmental performance indices when choosing mobility products. Honda recognizes these changes in consumer values and market demands as critical matters to focus on, and it is actively expanding the lineup of products that it offers powered by Earth Dreams Technology*. Through these initiatives, Honda is meeting customers’ needs and generating additional profit.

The Company believes that climate change, resource depletion and other issues are compelling society, which is heavily dependent on fossil fuels, to face up to energy risks. Energy issues have a very significant business impact on the mobility business sector. As such, Honda’s concern is that unless it proceeds with energy diversification, for example, through the utilization of renewable energy, it will become difficult to sustain the Company’s business. Honda is addressing energy issues by diversifying the energy sources used in its products and business activities, with the aim of completely eliminating energy risk from heavy dependence on fossil fuels, etc. The Company has set an interim target for 2020 and aims to establish technologies that diversify home energy sources and reduce CO2 emissions from personal mobility and home living to zero.
Honda is developing the Honda Smart Home System (HSHS) to help it realize this goal.
In addition, in the fields of its business activities Honda plans to introduce solar power generation of 4.2 MW in FY2019 for the use of renewable energy. As mentioned above, Honda is promoting energy diversification by actively introducing large-scale solar and wind power generation at Honda’s facilities.

* EARTH DREAMS TECHNOLOGY: A collective term to refer to a group of innovative technologies that greatly enhances both driving performance and fuel economy, building on advancements in environmental performance to pursue a joy of driving unique to Honda

Honda’s total GHG emissions: Conceptual projection

GHG emissions

Advancing Powertrain Electrification

Honda views dealing with climate change and energy risk as key challenges and actively promotes electrified products. Honda has set a goal to increase the ratio of vehicles adopting electrified technologies in its total automobile sales to two-thirds by 2030. To achieve this goal, the Company is seizing all new business opportunities by pushing forward with the development of plug-in hybrid electric vehicles (PHEV), electric vehicles (EV) and fuel cell vehicles (FCV), while entering into partnerships with other companies for the preparation of a hydrogen infrastructure involving the likes of hydrogen stations. To give an example of the Company’s efforts to develop such products and the infrastructure supporting their proliferation, American Honda Motor Co., Inc. installed 60 new EV charging stations on its Torrance, California campus, while the Honda Clarity series was announced in the United States, in which FCV, EV and PHEV powertrains are covered with the same platform. Honda is also working to promote electrification company-wide, by designating the Yorii assembly plant as the mother plant and base for all EVs, establishing a structure enabling development and production that meets market needs worldwide.

As for motorcycles, Honda is developing the PCX Electric/Hybrid and conducting demonstration experiments for the EV-CUB. Regarding power products, the Company has expanded product selection in line with customer needs by accelerating product electrification. This includes the LiB-AID E500, a handy storage battery that can be used as a portable power source, and the Miimo HRM520 robotic lawn mower.

TOPICS


Adopting Electrified Technologies with Motorcycles

Entered discussions on collaboration with Japan Post toward establishment of social infrastructure

Honda is pushing ahead with demonstration testing for postal delivery operation as environmentally friendly business activities, which include making a transition to a recycling-oriented society where limited resources are used more effectively as well as complying with increasingly strict exhaust emissions regulations.

Specifically, this initiative is aimed at the establishment of social infrastructure with a vision of utilizing electric motorcycles and other vehicles for postal delivery. This means exploring the possibility of introducing electric vehicles for postal delivery operation and conducting demonstration testing for installing charging stations in post offices.

Additionally, there is another initiative intended to realize efficient delivery vehicle operations and sustainable and universally available services. This includes utilization of Honda Biz LINC* telematics service for postal delivery service and establishment of a structure supporting a stable, accurate and safe postal delivery operation.

Honda will actively work to realize the establishment of social infrastructure that will contribute to the sustainability of the global environment.

* A cloud-based solution service that uses the GPS of smartphones and tablets and assists in increasing the efficiency of small vehicles (2-wheeler or light trucks) in short-distance commuting


Toward the Wider Use of Hydrogen

Operation of taxis as transportation infrastructure

Honda started operation of taxis using its Clarity Fuel Cell at the end of June 2017 in four major cities in Japan directed toward the wider use of FCV in the future. The Company will make use of information such as driving data gained through the taxi operation in research and development aimed at further performance evolution of FCVs to promote increased usage.

Collaboration to expand the hydrogen refueling station network in Northern California

Honda is supporting the introduction of seven hydrogen refueling stations in Northern California in collaboration with Toyota and Shell as a means to help spread the use of FCVs. Honda believes fuel cell technology has great potential to address society’s energy and environmental concerns and will build cooperative relationships so as to meet the needs of more customers.

Activities promoting hydrogen to the next generation

Honda conducts classes on hydrogen for students in collaboration with multiple local governments as part of stakeholder engagement efforts. By facilitating an accurate understanding of hydrogen among the younger generation, Honda is striving to respond to the increasing use of next-generation energy.

In addition, the Company is undertaking measures to promote the appeal of hydrogen at different events. Besides gaining the understanding of stakeholders, this serves as a valuable opportunity to hear the opinions of customers who visit the venue.

Activities promoting hydrogen to the next generation
Activities promoting hydrogen to the next generation

Efficient Utilization of Resources

The depletion and resulting difficulty of obtaining rare earth metals and other resources used in the Company’s products poses a significant risk to our business continuity in terms of the procurement of components and raw materials necessary for manufacturing.

Therefore, Honda considers the efficient utilization of resources one of the material issues and is actively promoting 3R (Reduction/Reuse/Recycling) activities as well as ensuring proper processing when disposing of end-of-life products.

Aiming at the elimination of risks related to resources and disposal that occur in various stages ranging from resource procurement to disposal, Honda is tackling this issue through cooperation/partnership with internal/external stakeholders.

Preservation of Clean Air

Honda recognizes that air pollution has been a critical issue since the 1960s when pollution issues escalated and believes that worsening air pollution in cities has a negative effect on people’s health, which hinders the realization of the “joy and freedom of mobility and a sustainable society where people can enjoy life.” Honda has sought to resolve this issue through the development of technologies that clean the gas emitted from products.

This began with development in 1972 of the CVCC engine, which cleared exhaust gas regulations under the U.S. Muskie Act, deemed the toughest in the world at the time. Since then, Honda has announced a series of developments that include high efficiency combustion technology and exhaust emissions purification technology using a catalyst. This has resulted in a reduction in the level of exhaust emissions from automobiles to one-thousandth of that registered prior to the enactment of the Muskie Act over the 40-year period.

Honda has also enhanced the combustion efficiency of engines and cleaned exhaust emissions by promoting conversion from two-stroke to four-stroke engines in motorcycles and power products as well as shifting from a carburetor to the Honda Programmed Fuel Injection (PGM-FI) system.

Through advanced development of exhaust emission cleaning technologies such as these, Honda avoids risks associated with business continuation caused by increasing costs to deal with tighter environmental regulations.

In addition, this enables products with exceptional environmental performance to be supplied at a reasonable price, and as a result, Honda leads the industry in cleaning exhaust emissions and addressing air pollution issues, which also leads to major business opportunities.

Initiative for the elimination of risks related to resources and disposal

Initiatives