Initiatives to Address Climate Change

The Frontier Management Group will contribute to the fight against climate change by promoting the reduction of its greenhouse gas emissions and environmental footprint, and by actively supporting our corporate clients as they shift to new business models to build a sustainable global environment and society.
We will disclose climate change-related information in accordance with the TCFD framework: Governance, Strategy, Risk Management, and Metrics and Targets.

Governance

To contribute to sustainability throughout the Group in the medium to long term, our Group established a Basic Policy for Sustainability, the Sustainability-Related Priority Issues (Materiality) to be addressed by the Group, and a Sustainability Promotion Committee in November 2022.

Strategy (1) Risks and Opportunities of Climate Change

The Group conducted a scenario analysis based on the risks and opportunities brought about by the climate change.
In the scenario analysis, we analyzed the financial impact in 2030 on our mainstay business, Consulting and Advisory Business, for two assumed scenarios: a 1.5°C scenario in which the impact is manifested in terms of transition and a 4°C scenario in which the impact is manifested in physical terms.
For the magnitude of the financial impact, we set our operating income for the fiscal year ended December 31, 2023 to 100, with “Major” representing more than 30%, “Medium” representing 10% to less than 30%, and “Minor” representing less than 10%.
While natural disasters and the like caused by the climate change were found to have a negative impact on the Consulting and Advisory Business, the demand for these services may increase as companies go through the transition to a decarbonized society and adapt to climate change.

Strategy (2) Risks and Opportunities of Climate Change

■Analysis of Financial Impact in 2030

Risk management

Our Group has positioned climate change risks as priority risks. A Risk Management Committee forecasts and appropriately evaluates operational risks and establishes measures to avoid, mitigate, and transfer those risks. The status of the measures and the like is regularly reported to the Board of Directors. Specifically, we manage risks as follows.

• 1. Identify and update risks.
• 2. Determine the severity of each risk by considering its frequency and the magnitude of its impact (risk analysis) and establish a priority order (risk assessment).
• 3. Determine a policy for response and establish preventive measures according to the nature of each risk (risk measures).
• 4. Evaluate the response status using five evaluation levels (monitoring and evaluation).

Metrics and targets

The Company aims to achieve a “net zero” in carbon dioxide emissions.

• 1. To shift office electricity to renewable energy, we switched our head office in Roppongi, Tokyo, to green power in September 2022.

• 2. By the fiscal year ending December 2030, we will reduce greenhouse gas emissions by 50% as compared to the fiscal year ended December 2021.
• 3. By the term ending December 31, 2050, we will reduce greenhouse gas emissions to net-zero compared to the term ended December 31, 2021.
• 4. We are working to reduce the amount of single-use plastics in our offices.
• 5. We encourage climate-friendly business travel by our employees.
• 6. We actively support our client companies for the shift to a decarbonized and recycling-oriented society.

1.Human Resources Development Policy and Workplace Environment Enhancement Policy

For the Group to achieve sustainable growth and development, it is vital that our employees maintain mental and physical health, refine their individual abilities, act in ways that will gain the trust of our clients, stakeholders, and society, and continue to provide high-added-value services as professionals.
We will support the growth of our employees so that they can perform as professionals, as well as maintaining and enhancing workplace environments where they can fully utilize their abilities.

2.Risks and Opportunities

3.Metrics and Targets

Deepen diversity and acceptance

In addition to establishing and facilitating a DE&I Promotion Committee, we are working to create a comfortable internal environment for diverse human resources, such as by maintaining and enhancing diversity of expertise and diversity of sex and nationality, introducing lifestyle support services for employees who are not of Japanese nationality, establishing leave, reduced working hours, and other systems for employees who are raising children, and encouraging employees to take childcare leave.
Our policies on recruitment and on working conditions are as follows.

• ・The Company’s basic policy is one of fair recruitment activities, and we provide opportunities for applicants to respond regardless of their race, nationality, sex, age, or other attributes.
• ・The Company does not discriminate based on race, nationality, sex, age, or other attributes in the matter of working conditions.

(Note)Assessment and promotion within the Company are based on the individual’s abilities, irrespective of their sex, age, or other attributes. In addition, the level of wages is linked to the nature of an individual’s duties and their position, and there is no disparity between the level of wages for male and female workers involved in the same duties and serving in the same position.

Continue investing in human capital

In response to the question “When do you feel more strongly motivated towards your work?” in an internal questionnaire conducted in May 2023, the most popular response was “When I feel that my abilities and skills have improved,” with “When I feel that I have been of use to people and society through my work” in second place, and “When I am praised or thanked by clients” in third place. This supports the idea that the employees of the Company are eager to grow and contribute to the client and society through their work.
As a rule the Company recruits people for specific departments, work types, and working locations, but it supports the participation of diverse human resources through such measures as transfers to different departments (including moves to subsidiaries) at the request of employees.
The Company strives to provide support for the growth of employees and to maintain and enhance their health, so that they can demonstrate their abilities as professionals to the full.

• ・Support for growth
  Employees other than managers and supervisors are provided with online educational and training tools that can be used freely for one year, and the Company also provides financial and other support to all employees for such purposes as acquiring qualifications and language study
• ・Support for health
  All employees are provided with the opportunity to undergo a medical checkup and a stress check once a year at the expense of the Company.
  We have also established a Wellness Center, and put in place a system that makes an occupational physician available for meetings with employees once a week.

Train and produce management talent

In order for employees to succeed as professionals, it is important that they act in such a way as to win the trust of clients, stakeholders, and society, that they hone their skills so that they can provide high-value-added services as professionals, and that they maintain their passion for contributing to clients and society.
In order to respond to employees’ eagerness to grow and contribute to society through their own work, the Company supplies training in the professional skills required for each department to offer its services, provides opportunities for employees to resolve difficult issues tailored to their level of ability, and so on.
The Company also works to provide opportunities for secondment overseas and to alliance partners, as well as for the accumulation of experience through sending managers as CxOs to client companies.

Contribute to a society where people can succeed while making most of their individuality

Human capital management that leads to increased corporate value over the medium to long term is also becoming increasingly important for client companies seeking to achieve sustainable growth and development, and this could lead to increased demand for our management consulting services.
In order to help achieve a society in which people can succeed while making the most of their individuality, the Company will promote DE&I to clients, and provide services related to human capital management, human rights, and other issues to client companies.