Information Disclosure Based on TCFD Recommendations

At Tanseisha, we assess climate-related risks and opportunities in our business activities and strive to proactively disclose and enhance information in line with the "Governance, Strategy, Risk Management, Metrics and Targets" framework recommended to companies by the TCFD (Task Force on Climate-related Financial Disclosures). We will also take concrete measures to address climate change.

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Sustainability
Information Disclosure Based on TCFD Recommendations

Governance

System overview

Our company is promoting sustainability initiatives in accordance with the Tanseisha Group Sustainability Policy, which states, "By confronting environmental and social issues through our business of creating valuable spaces and working sincerely to resolve them, we will strive to sustainably improve our corporate value and contribute to the realization of a colorful, sustainable society." We have established a Sustainability Committee to address sustainability-related issues, including climate change, and President and Chief Executive Ofcer serves as the committee's chair. The committee regularly reports its deliberations and status to the Board Director, and important sustainability-related policies are reviewed by the committee and then submitted to the Board Director for deliberation and decision-making.
Furthermore, with regard to "responding to climate change," "human capital management," and "responding to human rights," the committee has established subcommittees that specialize in the themes.

strategy

We view rising temperatures due to climate change, as well as the resulting social changes and disaster risks, as important issues and are actively working to address them. As part of this, we have undertaken to identify short-, medium-, and long-term risks and opportunities related to climate change and conducted scenario analysis. Specifically, we are considering two scenarios: a 1.5°C scenario and a 4°C scenario.

This approach is based on the international goal of limiting the rise in global average temperature since the Industrial Revolution to 1.5°C, as outlined in the Sixth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC) and the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP).

In addition, we referred to future forecast reports published by governments and international organizations and comprehensively considered transition risks (policies, laws and regulations, markets, reputation), physical risks (acute risks, chronic risks) associated with climate change, and opportunities (products and services, markets, resilience) that arise from responding appropriately to climate change.

Scenario assumptions

risk kinds	setting scenario	Reference Scenario	Overview	Possible impact on our business activities
transfer risk	1.5℃ scenario	International Energy Agency (IEA), "World Energy Outlook 2022" Net Zero Emissions by 2050 Scenario (NZE Scenario)	A scenario that limits the rise in average temperature to less than 1.5°C by the end of the 21st century. In order to achieve sustainable development, bold policies and technological innovations will be implemented, and as a result, the social changes that accompany the transition to a decarbonized society are likely to have an impact on business.	- Carbon taxes and other regulatory compliance costs will be added to prices for high-emission materials such as steel and concrete. ・ Environmental Consideration design will be required across the entire market - Low-carbon materials and recycled materials will become more widespread, and their adoption will become commonplace. ・Initiatives for sustainability are accelerating, and differentiation from competitors is required
physical risk	4℃ scenario	Intergovernmental Panel on Climate Change (IPCC), "IPCC Sixth Assessment Report (AR6) SSP5-8.5 Scenario"	The average temperature will rise by about 4°C by the 21st century. It is more of a left-to-go situation, and no social changes will occur, but there is a greater possibility that abnormal weather and disasters caused by climate change will affect business.	・The frequency of climate-related disasters occurring in our supply chain will increase, increasing the impact on our business activities and procurement. ・Frequent climate disasters around the world will make it difficult to procure raw materials. -Increasing and more severe heat waves will have a negative impact on field workers

Scope of scenario analysis

item	Scope of scenario analysis
region	Domestic
Target business scope	Business (including the entire upstream and downstream supply chain)
Company Scope	Overall consolidated
Define the time axis	Short-term (within 1 year), medium-term (within 3 years), and long-term (more than 3 years) are assumed
How to assess impact	In accordance with our internal risk assessment method, we evaluate risks based on two axes: probability of occurrence and predicted financial impact.

Scenario analysis results

risk

classification	Risk Items	Timeline	influence	Impact	Countermeasures
policy· Laws and regulations	New regulations and social obligations emerge	Medium to long term	Increase in raw material procurement costs due to the introduction of carbon taxes and stricter regulations on high-emission building materials	Medium	・Selection of alternative products and suppliers with low carbon emissions - Low carbon throughout the supply chain ・Reduce your company's emissions ・Price transfer to services
market	Social trends toward a low-carbon society and the transition of business needs	short to long term	Loss of opportunities to order Environmental Consideration facilities and sales decline due to delays in responding to climate change	large	・Development of low-carbon solutions ・Strengthening and promoting "Environmental Consideration design" and "Environmental Consideration construction"
market	Rising procurement prices for external resources and rising costs	short to long term	Increased demand for low-carbon products and recycled materials leads to higher procurement prices and fewer sales opportunities	large	・Price transfer to services - Consider procuring alternative products ・Strengthening cooperation with suppliers of low-carbon products ・Multiple sources of procurement ・Cost reduction through waste reduction and utilization of surplus materials
reputation	Loss of reputation and trust due to insufficient efforts to reduce environmental impact, such as reducing greenhouse gas emissions and energy conservation	short to long term	Failure to meet international greenhouse gas emissions targets or insufficient efforts to reduce environmental impact at the level required across all business sectors could lead to a decline in social trust and damage to corporate value.	Medium	・Appropriate and proactive information disclosure using external experts, etc. ・Monitoring the occurrence of reputation-related events ・Strengthening efforts to reduce environmental impact
acute physical	Intensified wind and flood damage and abnormal weather	short to long term	Losses due to human and material damage (including to operating facilities), disruption of lifelines, and disruption of supply chains that hinder business continuity	Medium	・Implementing disaster prevention measures and formulating disaster manuals ・Securing alternative suppliers in the event of a disaster, and diversifying suppliers
chronic physical	Decreasing resources due to the normalization of rising temperatures	Medium to long term	Changes in forest vegetation have made it more difficult to procure resources and increased procurement costs	Medium	・Securing alternative suppliers and diversifying suppliers
chronic physical	Worsening working conditions due to rising temperatures	Medium to long term	・Sales decrease due to the extension of construction period caused by the increase in midsummer days and adjustment of work hours for health considerations - Increased costs for measures to improve the working environment - Concerns that the deterioration of the working environment will hinder the retention of personnel	Medium	・Improvement of working conditions throughout the supply chain ・Promotion of health management

opportunity

classification	Opportunity Items	Timeline	influence	Impact	Countermeasures
Resource efficiency	Improving the efficiency of material transportation (including the use of locally produced materials)	short to long term	・Reduction of transportation costs and CO2 emissions during transportation - Reduction in industrial waste disposal costs	small	・Implementation of industrial waste reduction measures ・Considerations during design and selection of partner companies ・Strengthening the use of locally produced materials in cooperation with the local community - Promoting electrification
Products & Services	Changes and expansion of facility demand due to the promotion of sustainability	short to long term	・Sales will increase due to increased demand for facility renovations that are more comfortable and energy-efficient, and that incorporate disaster prevention measures, as outdoor environments deteriorate due to rising temperatures. ・Sales increase due to increased demand for facility renovations to foster environmental awareness toward a carbon-free society	large	・Strengthening sales activities and expanding target audience ・Strengthening proposal capabilities ・Strengthening external communication
Products & Services	Use and development of materials, products and services with low carbon emissions	short to long term	Increased sales due to increased demand for environmentally friendly products and services	large	・Development of low-carbon solutions ・Strengthening and promoting "Environmental Consideration design" and "Environmental Consideration construction" ・Strengthening internal awareness-raising activities and external communication activities ・Promote cross-departmental Environmental Consideration proposals by strengthening dedicated departments ・Expanding distribution and sales channels ・Proposal for indoor spaces that utilize carbon offsets
market	Entering new markets	Medium to long term	Increased sales through the creation of new businesses that contribute to reducing carbon emissions	small	・Development of new renovation business ・Development of new businesses and new products (solutions)
Resilience	Creating new businesses using resources from the space creation business	Medium to long term	Securing new revenue sources and diversifying the risk of demand fluctuations	small	・Development of new businesses and new products (solutions) ・Promoting collaboration and co-creation with other companies and creators ・Developing new customers

Risk Management

We constantly identify, evaluate, analyze, and take measures to address issues, including sustainability-related issues, that could have a significant impact on our business performance and financial position and could disrupt the smooth operation and growth of our business.
These risks in business activities are identified mainly by the Risk and Compliance Committee, chaired by President and Chief Executive Ofcer, which oversees and promotes risk management activities in accordance with the Loss Risk Management Regulations, and are evaluated based on criteria such as the likelihood of an event occurring and the degree of impact if it does occur.Based on the results of the evaluation, risks that management should place particular emphasis on are identified, risk countermeasures that should be implemented from an overall perspective are determined, and the implementation status of these countermeasures is monitored.
Important choices and decisions regarding the identification, assessment and countermeasures of the above risks are reported to the Board Director and are linked to management judgment and decision-making.
Climate change-related and human capital-related risks are identified and evaluated by the Sustainability Committee, which then reports to the Risk Management and Compliance Committee, where they are managed by integrating them into the overall risk assessment (risk recognition and evaluation) and risk countermeasure processes.

Indicators and goals

In our medium-term management plan (fiscal year ending January 2025 to fiscal year ending January 2027), we have set non-financial targets related to climate change. Specifically, we aim to reduce Scope 1 and 2 greenhouse gas emissions by 40% compared to fiscal year 2021 (February 2021 to January 2022).
Our greenhouse gas emissions (Scope 1 and 2) for fiscal 2021 were 367t-CO2.

The trends in greenhouse gas emissions are as follows:

	Fiscal Year 2021	Fiscal Year 2022	2023 (reference)	FY2024 (reference)
Scope1、2（t-CO2）	367	292	311 （2,645）	326 （2,591）
Scope3（t-CO2）	256,896	258,279	318,039 （320,798）	337,947 （342,584）
Total (t-CO2)	257,263	258,571	318,350 （323,443）	338,274 （345,174）
Scope 1 and 2 reduction rates	－	20％	15％	11%

*The calculation periods are February 2021 to January 2022 for FY2021, February 2022 to January 2023 for FY2022, February 2023 to January 2024 for FY2023, and February 2024 to January 2025 for FY2024.

*This table covers the display business of TANSEISHA Co., Ltd. alone, and does not include facility management or other businesses.

*Reference data for fiscal 2023 and fiscal 2024 has been calculated by expanding the scope of calculation from those years, with Scope 1 and 2 covering TANSEISHA Co., Ltd. and domestic consolidated subsidiaries, and Scope 3 covering all businesses of TANSEISHA Co., Ltd. alone (including facility management and other businesses).

* Scope 2 emissions are calculated based on market standards.

* The data for fiscal 2023 has been revised from the figures stated in the securities report for the fiscal year ending January 2025 due to changes in calculation policy, the updating of emission factors, and a review of emission intensity.

The Task Force on Climate-related Financial Disclosures (TCFD) is an international initiative established by the Financial Stability Board (FSB) in 2015 to encourage companies to disclose information on the financial impact of the risks and opportunities that climate change poses to their businesses.