Toyota Motor Corporation
1 Toyota-Cho, Toyota City,
Aichi Prefecture 471-8571,
Telephone: +81 (0565) 28-2121
- MSCI Japan ESG Select Leaders Index (2018), (In the top 10)
- FTSE4Good Index Series (June 2020)
- FTSEGood Japan Index (June 2020)
- EcoVadis Sustainability Ratings (2018) Gold Rating
- CDP A list (January 2020)
CHIEF SUSTAINABILITY OFFICER
Kevin M. Butt
- Green Fleet Manufacturer of the Year in the Fleet News Awards
Report created by Muge Acar
Toyota Motor Corporation
Toyota Motor Corporation is a Japanese multinational automotive manufacturer headquartered in Toyota, Aichi, Japan. They operate their business with a focus on vehicle production and sales, as well as contributing to local areas through corporate sports activities.
In 2017, Toyota’s corporate structure consisted of 364,445 employees worldwide and, as of December 2019, is the tenth-largest company in the world by revenue. Toyota is the second largest automobile manufacturer in the world, behind Volkswagen, based on 2018 unit sales.
Toyota was the world’s first automobile manufacturer to produce more than 10 million vehicles per year, which it has done since 2012 when it also reported the production of its 200-millionth vehicle. As of July 2014,
Toyota is the global market leader in sales of hybrid electric vehicles, and one of the largest companies to encourage the mass-market adoption of hybrid vehicles across the globe. Toyota is also a market leader in hydrogen fuel-cell vehicles.
Cumulative global sales of Toyota and Lexus hybrid passenger car models achieved the 10 million milestones in January 2017.
Company Sustainability Activity
Toyota is working on initiatives that contribute to the sustainable development of society and the world through all its business activities in cooperation with the global society. At the root of these initiatives are the Five Main Principles of Toyota, passed down as the foundation of their corporate management, and the Guiding Principles at Toyota, which lay out how they want to be as a company.
In 2011, they announced the Toyota Global Vision, which lays out how they want to be as a company, based on their experiences with the 2008 global financial crisis and the series of recalls they had in 2010.
Toyota’s ideas and values are in line with the aims of the UN Sustainable Development Goals (SDGs), which went into effect in January 2016. Also, environmental issues are one of the key aspects of what Toyota sees as sustainability issues. With a view to the “under 2 ̊C” scenario agreed on in the Paris Agreement, Toyota is promoting initiatives under the Toyota Environmental Challenge 2050.
- Toyota supports and signed the recommendations announced by the Task Force on Climate-related Financial Disclosures (TCFD) established by the Financial Stability Board
- Efforts to save energy through rapid heating of thermoplastic CFRP using superheated steam were recognized, and Toyota won the Minister of Economy, Trade and Industry Award along with Chubu Electric Power Co., Inc. and Yutaka Electronics Industry Company Limited in 2018.
- Toyota sold a cumulative of 13.53 million hybrid electric vehicles and through these sales reduced CO2 effects by 108 million tons.
- Toyota’s investigation of climate-related risks and opportunities based on the 2°C and beyond 2°C scenarios led to the logic of their 2030 Milestone, designed to achieve the Toyota Environmental Challenge 2050.
- Toyota gained the certificate of Green Power and Green Heat.
Toyota’s 6 environmental challenges to be achieved by 2050:
- Challenge 1: Reduce global average CO2 emissions during operation from new vehicles by 90% from Toyota’s 2010 global level
- Challenge 2: Completely eliminate all CO2 emissions from the entire vehicle life cycle
- Challenge 3: Achieve zero CO2 emissions at all plants worldwide by 2050
- Challenge 4: Minimize water usage and implement water discharge management based on individual local conditions
- Challenge 5: Promote global deployment of End-of-life vehicle treatment and recycling technologies and systems developed in Japan
- Challenge 6: Connect nature conservation activities beyond the Toyota Group and its business partners among communities, with the world, to the future
Toyota’s 2030 milestone goals
- Challenge 1: Make annual global sales of more than 5.5 million electrified vehicles, including more than 1 million zero-emission vehicles (BEVs and FCEVs) The estimate of global average CO2 emissions reduction in g-CO2/km from new vehicles will be 35 percent or more, which may vary depending on market conditions, compared to 2010 levels
- Challenge 2: Reduce CO2 emissions by 25 percent or more over the entire vehicle life cycle compared to 2013 levels by promoting activities for the milestones of Challenges 1 and 3, and with support from stakeholders such as suppliers, energy providers, infrastructure developers, governments and customers
- Challenge 3: Reduce CO2 emissions from all plants by 35 percent compared to 2013 levels
- Challenge 4: Implement measures, on a priority basis, in the regions where the water environment is considered to have a large impact, complete measures at the four Challenge-focused plants in North America, Asia and Southern Africa, complete impact assessments and measures at all of the 22 plants where used water is discharged directly to rivers in North America, Asia and Europe.
- Challenge 5: Complete establishment of battery collection and recycling systems globally. Complete set up of 30 model facilities for appropriate treatment and recycling of End-of-life vehicles
- Challenge 6: Realize “Plant in Harmony with Nature” as well as implement activities promoting harmony with nature in all regions where Toyota is based in collaboration with local communities and companies. Contribute to biodiversity conservation activities in collaboration with NGOs and others. Expand initiatives both in-house and outside to foster environmentally conscious persons responsible for the future
- Toyota has the ultimate goal to have zero casualties from traffic accidents
- Toyota aims to reach 100% renewable energy electricity in its South America affiliates
REDUCING ENVIRONMENTAL FOOTPRINT
- Toyota is participating in the SDGs Toyota Renewable Energy Challenge, a demonstration project launched by Toyota City in 2019 to locally produce renewable energy for local consumption. Under this initiative, locally produced renewable energy including solar power and biomass energy as well as its environmental value are utilized at local public facilities, plants, and so on. As a part of this initiative, Toyota is challenging to make battery electric vehicles (BEVs) carbon-free throughout its entire product life cycle. Specifically, utilizing the environmental value of renewable energy through the Certificate of Green Power with “Ha:mo,” car-sharing ultra-compact BEVs, they seek to reduce carbon throughout the product life cycle
- Toyota reduced 14.9% in global average CO2 emissions from new vehicles in 2018 compared to 2010. Toyota’s calculation results for Scope 3 in 2019 for CO2 emissions was 414.91 million tons-CO2.
- Previously all of Toyota’s transportation was made by truck, but by implementing a modal shift to railway transportation between the Nagoya Minami Terminal and the Kitakyushu Terminal, reducing the total number of transportation trucks from 18 to 13 per day they reduced their CO2 emission from 10,052 tons-CO2 per year to 1,495 tons-CO2 per year.
- Since April 2018, Toyota has been working to expand the use of renewable energy utilizing the Certificate of Green Power to achieve its environmental challenges.
- The Green Power Certificate system is a mechanism to trade the environmental added value of electric power generated from wind power, solar power, biomass, and other renewable energy; certificate issuers receive third party certification in the form of the Certificate of Green Power.
- Toyota is using 100% renewable energy in 4 of their plants in Turkey, UK, Poland and Russia.
- Toyota started implementing solar power generation in Southeast Asia, India, Taiwan and South Africa.
- In North America renewable electricity covers all electric power at Toyota’s North American Headquarters Campus.
- To reduce CO2 emissions in production, Toyota continues to introduce innovative production technologies into processes that consume a lot of energy, such as painting processes.
- Toyota accelerated global introduction of renewable energy, especially with the goal of achieving 100% usage in 2019 in Europe and 2020 in South America.
- To reduce its water usage, Toyota promoted introduction of reduction technologies and daily water-saving efforts, such as water recycling and reducing the amount of steam used in painting processes.
- Toyota set up a model facility for properly processing End-of-life vehicles in Vietnam.
- Toyota began studying ways to utilize more recycled plastic first in Europe where the recycled plastic market is large. In the area of production, they are continuing to implement daily waste-reduction measures, such as converting grinding dust into valuable material by reducing its water content. In the area of logistics, Toyota introduced simplified and returnable packaging and wrapping materials, steadily reducing the waste generated and the material used in packaging and wrapping.
- In the Toyota Green Wave Project, as the first step of the Plant in Harmony with Nature, Toyota opened a new biotope at the Tsutsumi Plant under cooperation from the local residents and experts and established an activity structure based on an indicator species survey.
- In the Toyota Today for Tomorrow Project, Toyota continued collaboration toward biodiversity conservation by jointly hosting a side event with the International Union for Conservation of Nature (IUCN) at the UN conference, and donating vehicles to NGOs involved in survey and conservation initiatives for endangered species.
- Toyota has been conducting eco-factory activities since FY2004 with the aims of steadily incorporating environmental measures into plant activities and becoming No. 1 regional plant.
- Toyota introduced the CDP Supply Chain Program in FY2016 to support continuous environmental initiatives conducted with suppliers. The program enables them to assess environmental risks and opportunities across the supply chain.
- Toyota has been striving to reduce VOCs (volatile organic compounds) emitted, which causes photochemical oxidation in vehicle painting processes. Specifically, they have reduced the use of paints and thinners, continuously promoting initiatives linked to painting facility refurbishment plans and day-to-day activities to reduce VOC emissions.
- Since the early 1990s, Toyota has been collecting and recycling bumpers replaced at dealers as a way to reduce the usage of petroleum-derived plastics.
- Toyota began recycling automobile motor magnets in 2012. As of March 2019, they collected a cumulative 41 tons of magnets, recycling rare earth.
- Toyota launched a system to extract and recycle tungsten in 2010. As of March 2019, they recycled a cumulative total of approximately 196 tons of cemented carbide tools.
- In FY2019, Toyota Motor Corporation (TMC) shifted from paying for recycling to selling recycling materials as valuable goods and so on, by reducing the water content of grinding dust. The total waste volume, as a result, was 32.2 thousand tons (down 1.5% year on year), and the waste volume per unit produced was 11.2 kg (down 0.4% year on year).
- Globally, the waste volume increased in some areas due to increases in production in conjunction with the establishment of new lines. The total waste volume, as a result, was 496 thousand tons (down 0.6% year on year).
- Toyota Motor Corporation (TMC) is taking a broad range of initiatives to reduce the amount of packaging and wrapping materials used in logistics. These include increasing packaging efficiency in shipping containers, using returnable containers to reduce the amount of non-recyclable materials used, and making packaging and wrapping materials simplified and lighter.
- In FY2019, TMC succeeded in reducing the usage of packaging and wrapping material per shipment unit to 6.21 kg/m3 (same as the previous year) by making packaging and wrapping materials smaller and adopting returnable shipping containers.
- The total usage of packaging and wrapping materials amounted to 46.4 thousand tons (up 1.3% year on year).
- In FY2019, Toyota Motor Corporation (TMC) continued measures such as reducing the amount of steam used in production processes. Total water usage was 10.1 million m3 (down 2.2% year on year).
- The production volume decreased, but a uniform amount of water is used regardless of the number of units, and consequently, water usage per unit produced was 4.1 m3 (up 4.4% year on year).
- Globally, Toyota is steadily implementing measures to reduce water usage according to the actual water environment in each country and region.
- Measures were implemented to recycle wastewater and more affiliates decreased their water usage. However, as a result of an increase in the number of units produced due to the creation of new production lines and other factors, total water usage was 33.7 million m3 (up 2.3 percent year on year). Moving ahead, they will continue striving to minimize impacts on the water environment through the promotion of water-saving and water recycling.
- The Toyota Green Wave Project is an initiative to connect communities through these diverse activities promoting harmony with nature. By extending Toyota Group activities to promote harmony with nature in Japan and overseas, they aim to expand living creature habitats and help create a sustainable society, benefitting biodiversity.
- Toyota has several projects to help afforestation such as the Plant in Harmony with Nature Project, which creates environments that foster nature and living creatures, and the All-Toyota Green Wave Project, which fosters ties between local communities and the Group.
- Toyota’s afforestation activities have been conducted since 2007 with the theme of creation of forests at plant sites. The Tsutsumi Plant, where the Prius is produced, serves as a model plant for this project.
- In October 2018, Toyota opened Biotope Tsutsumi, in order to help conserve the original local ecosystem. The Biotope Tsutsumi environment integrates waterside, grassland, forest, and other natural areas.
- Toyota Green Wave Project Working Groups were established by 23 affiliated companies in May 2015 to expand initiatives in harmony with nature, enhance the dissemination of information, and strengthen cooperation by participating companies.
- In FY 2019, 248 activities were carried out in Japan. In May 2018, collaborative activities were conducted as the fifth All-Toyota unified activities.
- In Fengning Manchu Autonomous County, Hebei Province, where advancing desertification has become a serious problem, Toyota started an afforestation project in 2001 and for the past 18 years, has planted about 5.55 million trees in approximately 3,430 ha of land.
- Toyota has established the Toyota Today for Tomorrow Project to bolster its long-standing Toyota Environmental Activities Grant Program and afforestation projects in China and the Philippines on a global basis. They aim to contribute to society, they will work together with organizations engaged in nature conservation around the world by establishing projects to solve issues in the areas of living in harmony with nature and biodiversity.
- Toyota began a five-year partnership with IUCN in May 2016 to promote scientific understanding of the biodiversity crisis. Under the partnership, they provide annual grants of approximately 1.2 million U.S. dollars, supporting the IUCN to enhance the IUCN Red List2. With this support, the IUCN will conduct assessments of extinction risk for more than 28,000 species, accounting for 35% of species requiring assessment.
- Forest of Toyota in Toyota City is a company-owned forest near the urban areas. It has been maintained based on the environment of satoyama, which was once part of their lives, creating a forest where living creatures can naturally inhabit.
- Toyota is working on installing the Toyota Safety Sense system that packages multiple active safety systems, including collision damage mitigation braking, in almost all their passenger vehicle models. They are also working on developing the Intelligent Clearance Sonar (ICS) (Parking Support Brakes [Stationary Objects]), which helps prevent accidents caused by pressing the wrong pedal.
- Since its market launch in 2015, Toyota Safety Sense has been installed in a total of more than 10 million vehicles globally (as of October 2018).
- Toyota’s social contribution activities trace their roots to Sakichi Toyoda, the father of Toyota Motor Corporation’s founder, Kiichiro Toyoda. In 1925, Sakichi pledged one million yen (at the time) to the Imperial Institute of Invention and Innovation to encourage battery-related inventions to support inventions that would enrich people’s lives.
- Toyota respects the basic human rights of all individuals, including its employees and those in their supply chain. Toyota is a company that practices the philosophy of “Respect for People.”
- Toyota decided to prioritize Migrant Workers and Responsible Sourcing of Cobalt as the main topics for FY2020. Their aim is to partner with external stakeholders to fully understand and align with societal expectations, while also maintaining legal compliance in all of their operations and within the supply chain.
- They have partnered on the development of the “ASSC Tokyo Declaration 2020.” This is a set of 13 declarations created to enhance and respect the rights of migrant workers from the moment of recruitment, during overseas employment, and until their safe return to their home countries.
- Toyota has Labor-Management Joint Declarations established in Japan (1962), Thailand (1993), Indonesia (2004) and Brazil (2015) as a global framework, in order to agree on a universal philosophy of labor relations.
- Toyota offers educational programs to familiarize members of all classes, from new entrants to officers, with their expected roles in promoting safety and health.
- Aiming to raise the health level of all employees, Toyota has been promoting a company-wide initiative since 2017, promoting eight lifestyle habits that have an impact on the prevention of mental and physical diseases. This initiative, named Healthy Lifestyle Challenge 8, is aimed at developing healthy people by defining the habits necessary to maintain health and encouraging each employee to adopt healthier habits or pay greater attention to the habits they have already adopted.
- Toyota is implementing measures appropriate to individual regions globally throughout the entire Toyota Group. In particular, they have set up a dedicated diversity and inclusion promotion organization in the Head Office in Japan, TMNA (U.S.), TMCA (Australia), and TSAM (South Africa). Furthermore, in many regions, they have established diversity and inclusion promotion organizations consisting mainly of concurrent appointments within the area of human resources.
- In 2002, Toyota started initiatives at the Head Office centered on expanding and establishing measures to support women who are trying to balance work and childcare. Then in 2012, they began focusing on initiatives for creating a work environment that would help women gain motivation and support their participation (especially the development of female managers).
- Since 2015, Toyota has offered Pre-maternity Leave Seminars and Supervisor Career Interviews for employees who take maternity leave.
- In 2019, they introduced a career workshop targeting female employees and their supervisors. They are supporting the continued growth of female employees through various measures, including supporting long-term career building with life events taken into consideration, providing advice to supervisors on how to guide their subordinates, and facilitating dialogues between supervisors and subordinates.
- In 2005, they introduced the career return system, which provides re-employment opportunities to employees who are forced to leave Toyota due to job-related relocation of their spouse (regardless of the spouse’s gender or whether the spouse is a Toyota employee) or the need to provide nursing care.
- In 2019, Toyota expanded the system and introduced the career continuation support system for Toyota employees who are moving overseas due to their spouse’s overseas relocation.
- In April 2018, Bubu Forest was built in the headquarter area, and it is the fourth childcare facility, for 320 children. To support shift workers at plants and nurses who work the night shift, Bubu Forest offers operation in the early morning hours as well as overnight stays. It also offers shuttle service from nearby plants to pick-up and deliver children.
- Toyota and nine group companies established the Toyota Female Engineer Development Foundation in December 2014 to contribute to the promotion of women’s participation in manufacturing businesses in Japan. The aim is to attract and expand the number of girls to study in the science fields and foster female engineers in monozukuri (manufacturing).
- Toyota agreed to become a “National Partner” with the Special Olympics Initiatives Nippon (SON) in January 2016. In November 2017, Toyota agreed with Special Olympics Initiatives International to become a Global Gold Partner. In addition, Toyota has agreed to support Special Olympics Initiatives Unified Sports, which joins people with and without intellectual disabilities on the same team.
- Barron’s most sustainable companies
- Working Mother 100 Best Companies
- 2018 Top 50 Companies for Diversity
- The Hispanic Association on Corporate Responsibility Award
- America’s most responsible companies 2020
UN Sustainable Development Goals
UN SDGs Compliance
- Toyota promotes healthy living styles in their work environment.
- Toyota is dedicated to vehicle safety by developing and evolving a virtual human body model software application which enables computer simulation and analysis of injuries to the human body as caused in vehicle collisions. This software is known as the “Total Human Model for Safety” or “THUMS.”
- Reducing CO2 emissions is a global challenge. To achieve this goal, it is important to further promote the widespread adoption and use of electrified vehicles in the global market. While various types of electrified vehicles, including battery electric vehicles (BEV) and fuel cell electric vehicles (FCEV), have been developed, promoting the widespread use of them requires more time and cost, especially regarding battery and infrastructure development.
- Toyota has decided to grant royalty-free licenses on approximately 23,740 patents it holds for vehicle electrification-related technologies. Concurrently with the sharing of technologies, they will eagerly work toward the proliferation of electrified vehicles. To reduce CO2 emissions globally, Toyota aspires to help make electrified vehicles “standard” cars.
- Based on the desire to offer a “new mobility” that makes people’s daily lives better, Toyota has developed e-Palette, a next-generation electric car. Under the concept of “Move” for All, it is aimed at providing all people with freedom of movement and also moving their hearts through such movements. With a roomy interior space, this electrified and connected car employing automated driving technology is not only a safe and reliable means of transportation for people but also a Mobility-as-a Service (MaaS) vehicle available for multiple purposes, from distribution to sales of things. It emits no CO2 while driving. Large sliding doors, low floors, and electric ramps combined with automated driving control, which enables the car to fully pull over to a sidewalk or a station, can allow people in wheelchairs or elderly people to get into/out of the car and travel easily and smoothly.
- Establishing an environment that enables all people to move freely and pleasantly is very important in creating a sustainable society in which they can continue to live for a long time. e-Palette not only supports the movement of people but also delivers various goods and services to people, demonstrating the unconventional value of mobility. e-Palette contributes to the creation of new mobility services, envisioning the future of mobility, in which people will communicate with mobility.
- Toyota also works toward reducing its waste both in material and water. They also work towards achieving zero carbon emission by 2050.
- To mitigate the various risks posed by climate change, the “Life Cycle Zero CO2 Emissions Challenge” seeks to completely eliminate CO2 emissions not only while driving vehicles, but throughout the entire vehicle life cycle including materials and parts manufacturing and vehicle assembly, maintenance, disposal, and recycling. Some electrified vehicles may have materials and parts that increase CO2 emissions in the processes of manufacturing. Possible means of reducing this include adopting low CO2 emitting materials during manufacturing as well as reducing material usage and the number of parts used. It is possible to reduce CO2 emissions in the disposal and recycling stages by expanding the use of recycled materials and designs that make it easier to dismantle vehicles.
- Toyota will accelerate eco-friendly designs as they pursue “ever-better cars.” They will also promote reductions in CO2 through the efficient use of mobility by providing mobility services and supporting the widespread adoption of eco-driving.
- Tackling climate change is one of the most important social issues of today. In order to reduce CO2 emissions, the spread of electrified vehicles* is crucial. In response to rising expectations for electrified vehicles, Toyota has been taking advantage of its experience in the development of hybrid electric vehicle (HEV) technology for over 20 years and has been advancing development in all fields of HEV, PHEV, FCEV and BEV. The Toyota Environment Challenge 2050 aims at a long-term goal of reducing CO2 emissions from new vehicles during driving by 90 percent from the level of 2010. According to the milestones for the spread of electrified vehicles announced at the end of 2017, the target sales volume of electrified vehicles for 2030 is set at over 5.5 million. Currently, electrification of vehicles is advancing faster than this target thanks to a significant increase in HEV sales, and the target is likely to be achieved about five years ahead of schedule.
- Toyota is also working on the development of various types of zero-emission vehicles, such as BEV and FCEV. In 2020, starting with China, Toyota will launch a mass-production BEV it has been developing. Believing that environmental technologies can contribute to society when they are disseminated, they will accelerate their efforts to further promote electrification, with the aim of providing the value of zero CO2 emissions.
- Toyota considers the efforts it makes to conserve the earth’s complex and diverse ecosystem equally important to efforts it is making to tackle climate change.
- Under the Toyota Environmental Challenge 2050, which espouses the “Challenge of Establishing a Future Society in Harmony with Nature,” they help various global projects to protect biodiversity in collaboration with international organizations, NGOs, and NPOs.
- In 2016, Toyota formed a partnership with the International Union for Conservation of Nature (IUCN) to raise awareness of the world’s biodiversity crisis with the aim of enriching The IUCN Red List of Threatened SpeciesTM (IUCN Red List). Under the IUCN-Toyota Red List Partnership, over 28,000 new Red List assessments of animals, plants and fungi will be carried to make the IUCN Red List a true Barometer of Life. The assessments include a number of threatened fish and reptile species which are only found in Japan and collectively will be used to inform conservation action at local, national and global levels. Meanwhile, upon receipt of the Global 500 Award from the United Nations Environment Programme (UNEP) in 1999, they launched the Toyota Environmental Activities Grant Program. Under the themes of climate change and biodiversity, they have offered support for environmental activities carried out by NGOs and NPOs both in and outside Japan. Through this approximately 20-year-long program, a total of 413 projects in 57 countries and regions around the world have been supported (as of August 2020).
Secondary SDGs: 4, 6, 7, 15
Toyota has clear goals and initiatives for incorporating sustainability throughout their business. More specifically, the company aims to reduce their damage and promote sustainable practices in both their workplace and in their communities.
Toyota holds several certificates such as ISO 14001, ISO 26000 and LEED-certified offices. They contribute to their societies through partnerships with NGOs and other organizations.In addition, Toyota is compliant with the UN Sustainable Development Goals. For these reasons, Toyota have been rated a B.
Analyst Outlook: Neutral
Toyota strives to be a steward for the environment and is transparent in its efforts. However, the nature of the industry and the impact automotive and transport has on the environment is detrimental.
- Toyota’s industry is an industry that naturally damages the environment from the production to the use of products that is why it is difficult to achieve total sustainability but the company is working very hard to be as sustainable as they can.
- Toyota has been involved in the sustainability business for a long time and has been reporting their efforts since 2002.
- Toyota is very transparent in their reporting as they have a large scale of data and a very big book for sustainability published every year.