The climate crisis is advancing at an alarming rate. Extreme weather events and cataclysmic disasters caused by global warming require action from all of us
living on this planet. We have no time to wait.
As a business providing internet services across the globe, we recognize it is our responsibility to take action now. So, we took a crucial step towards carbon neutrality, achieving 100% renewable energy sourcing in 2021, with the aim of going carbon neutral in our own business operations by 2023.
We are committed more than ever to implementing robust programs to fulfill our duty to the planet, set a positive example for the world and become a forerunner in the industry.
Our commitment to carbon neutrality is formalized in our Group Environmental Policy here.
Rakuten is aiming to achieve carbon neutrality, or net-zero greenhouse gas emissions*1, from Rakuten Group business operations, including consolidated subsidiaries, in 2023.
Rakuten has already made significant progress towards carbon neutrality by adopting and expanding the use of renewable energy. The company joined the international RE100 initiative*2 in December 2019, and in 2021 achieved 100% renewable energy adoption*3 for electricity used in Rakuten Group, Inc.'s business operations. In 2022, we achieved an overall renewable energy rate of 11.6% for the Group including consolidated subsidiaries.
*1 Total of Scope 1 emissions (direct greenhouse gas (GHG) emissions from the company itself) and Scope 2 emissions (indirect emissions accompanying the use of
heat, steam, and electricity supplied by other companies), with third-party verification obtained and estimated in accordance with the GHG Protocol, the
international standard for estimating and reporting GHG emissions volume.
*2 Abbreviation for "Renewable Electricity 100%." An international collaborative initiative managed by international environment NGO The Climate Group in partnership with the NGO CDP, which promotes the disclosure of climate change information.
*3 Realized 100% transition to renewable energy, using the FIT Non-Fossil Certificate that certifies the renewable energy attributes of electric power.
Our primary emission sources are electricity use in Scope 2, upstream emissions, sold fuel and electricity and emissions in our investment portfolio.
Our Business Operation (Scope 1 & Scope 2)
Our strategy for making our own operations carbon neutral encompasses three measures.
Each initiative helps us quantify and monitor our progress and reach closer to our carbon neutrality goal.
- Improving Energy Efficiency:
Reduce GHG emitting activities
Switching to 100% Renewable Energy:
Build a 100% renewable energy portfolio
- Procuring Carbon Credits:
Offset our GHG emissions
Overall Supply Chain (Scope 3)
Rakuten will work alongside its partners to strengthen initiatives that support the realization of a decarbonized society by providing eco-friendly lifestyle and shopping options to consumers through the Group's diverse portfolio of services. Rakuten will also work to reduce future greenhouse gas emissions from its supply-chains*.
*1 Scope 3 emissions (indirect emissions other than Scope 1 and Scope 2) with third-party verification obtained and estimated in accordance with the GHG Protocol
Implementing climate change measures across Rakuten's ecosystem requires a strong, centralized management structure. This is why in January 2022, we established
the Environmental Department for developing and implementing strategies to address environmental issues. Moreover, implementation systems and reporting lines have
been organized across the Group. Under the Sustainability Committee, the Environmental Subcommittee holds monthly meetings. Climate change-related issues are managed by the COO.
The Environmental Department and the Environment Subcommittee work closely with relevant teams, organizations and international initiatives while holding every business unit and department accountable for their environmental impacts.
In each business department, we appointed a person in charge of environmental issues to coordinate with the Environmental Department on a wide range of environment-related activities, including strategy formulation, implementation and risk management.
Group-wide implementation systems and reporting lines are structured so as to escalate to the Sustainability Committee, which further analyses any crucial decisions and reports directly to the Board of Directors.
Currently, Rakuten's target is to ensure that we achieve carbon neutrality in Scope 1 and 2 emissions by 2023. The role of the Environmental
Department is to holistically support cross-departmental activities in helping Rakuten accomplish that goal and become a greener company. However,
this is only the first step in tackling this crucial societal issue. As the world undergoes revolutionary changes to become carbon neutral, we are
committed to leading the industry and continuing our mission to empower people and society.
We've only just begun, but we are working hard to bring everyone together to help tackle major societal challenges, guided by one of Rakuten's brand concepts: "Solidarity: Succeed as a Team."
Vice General Manager, Environmental Department
Our Business Operation
Improving Energy Efficiency
Over 98% of Rakuten's energy is electricity, 96% of which is consumed in our mobile network, data centers and offices.
Improving the efficiency of our facilities' electricity usage is a necessary first step towards greener operations. Examples of initiatives include the following:
At our domestic data centers, we cool down our servers efficiently by filling in the gap between the server racks with blanking panels and separating the hot air zones from the cold air zones. Without the panels, the hot air exhausted from the servers can recirculate back to the server racks, making the fans work more to compensate for the increased temperature. This results in a negative loop of inefficient cooling, leading to higher energy consumption. By adding the blanking panels and separating the air, we can ensure that the hot air isn't mixing with the cold air and raising the overall temperature. Blanking panels are one of the fundamental ways to ensure good airflow in our server rooms.
Some Rakuten offices are housed in green buildings. Our Japan headquarters, Rakuten Crimson House, is situated in the Futakotamagawa Rise complex, one of Japan's few LEED-Gold-certified* commercial facilities. We turn off monitors, lights, and electronic in-office appliances during non-working hours to conserve energy and avoid standby power. One of Rakuten Card's offices in Fukuoka prefecture introduced a rule for in-office temperature settings. This measure contributed to 20% less annual electricity consumption. We believe that even small steps are essential for progress toward a brighter future.
* "Leadership in Energy and Environmental Design" - A framework established by the non-profit U.S. Green Building Council, providing ratings for the world's greenest buildings.
To increase the energy consumption efficiency of lighting used in the stadium, we are promoting LEDs. Approximately 5,800 lights used for home games, events, and daily operations at Noevir Stadium, including the pitch lighting, various rooms, corridors, and concourses, have been converted to LEDs. It is estimated that this will reduce electricity consumption by around 67% compared to conventional lighting.
AI Vehicle Control System
Rakuten Seiyu Netsuper and Zenkoku Super introduced an AI vehicle control system to optimize their delivery routes via automated fleet dispatching, assisted by AI and Machine Learning. This achieved a 15% reduction in delivery distance with an estimated reduction in CO2 emissions of 170t per year. We expect more wide-scale reductions as we continue deploying the system.
Mobile Device Energy Consumption
We are also developing measures such as electricity consumption optimization for mobile networks using AI, as we leverage our expertise in leading technological innovation.
Switching to 100% Renewable Energy – Our Journey to RE100
The ratio of electricity from renewable energy sources for Rakuten Group, Inc. is 100% from 2021, and for the Rakuten Group including subsidiaries, it was 11.6% in 2022. As a company whose principal impact on climate change originates from energy consumption, managing the sources of the electricity we use is key to controlling our impact.
With the goal of ensuring a high level of quality as we make the transition to renewable energy, the Rakuten Group has created a quality standard classifying energy sources, considering long-term risks and opportunities. Rakuten's renewable energy quality standards are basically in line with the International Collaborative Initiative RE100.
Starting with Rakuten-owned facilities and facilities for which we have control over electricity contracts, we are looking to implement our proprietary standards for all electricity used in our business activities.
On-site power generation
At Rakuten Crimson House West in San Mateo, California, we have installed rooftop solar panels with a total capacity of 92.4kW. In 2021, the solar
panels generated 130,000 kWh of power, equating to 9% of the total power consumed. The option to install solar panels was one of the long-term
electricity efficiency options and was led with an intention to upgrade to green renewable energy. Solar panels at Crimson House West have
continuously provided part of the office's electricity needs since mid-2020.
Rakuten Fulfillment Center Matsudo in Japan has over 4,300 solar panels installed. It is intended to serve as a full, exclusive fulfillment center for Rakuten Seiyu NetSuper. The solar panels are estimated to supply 20% of the total consumption at the warehouse, making it one of the rare cases of solar panel installations in the logistics industry.
Renewable electricity contracts
Facilities run by Rakuten Baseball (Rakuten Mobile Park, Wellfam Foods Shinrindori Stadium Izumi, and Izumi-Osawa Dormitory) use electricity from renewable sources. In 2022, Rakuten Baseball, Inc. and Rakuten Vissel Kobe, Inc. completed the switch to 100% renewable electricity for all stadium business activities.
Procuring renewable energy certificates
With the goal of promoting eco-tourism and providing customers with a sustainable accommodation experience, Rakuten STAY has been working with Rakuten Energy since 2021 to switch to virtually 100% renewable energy at all accommodation facilities in Japan.
Overall Value Chain
Creating a greener future requires community efforts. It is crucial for companies to provide environmentally responsible options and encourage consumers to choose those in their daily lives.
Rakuten launched several campaigns that encourage our customers to make environmentally friendly decisions in their lives.
In 2022, Rakuten launched the "Go Green Together" project that spans across several services, aiming for a sustainable society by providing users more environmentally-conscious lifestyle choices. The "Go Green Together" provides practical tips and contents for tackling climate change and other environmental problems.
Empowering Our Business Partners
Rakuten strives to go beyond Scope 1 and Scope 2. To achieve a carbon neutral society across the full range of our value chain, working hand-in-hand with our stakeholders is crucial.
The "last-mile" journey is a critical step in the package delivery process, as e commerce has become a primary means of shopping in consumers' daily lives.
Product re-deliveries carry significant environmental issues as they result in increased carbon emissions compared to when the delivery is completed on the
In Japan, re-deliveries are estimated to generate additional CO2 emissions of approximately 254,000 tons* per year. Rakuten is working with couriers and customers to improve delivery efficiency. For example, Rakuten Ichiba offers customers several alternative delivery options; customers can pick up their packages at the closest convenience store, post office, or HAKO POST locker. Customers can also select their preferred delivery date and time to ensure they are home to receive their packages.
Rakuten will continue to strive to make the last-mile journey greener and more sustainable.
* Information from Ministry of Land, Infrastructure, Transport and Tourism
Renewable electricity supply
Reducing our emissions and carbon footprint will only be possible with the help of our partners. Each partner forms part of our vision with their unique
strengths. We aim to leverage the potential of all the members in our value chain to realize a more efficient business operation.
Since its launch, Rakuten Energy, our wholesale power provider, has been adding low-cost and optimized electricity solutions to the Rakuten Ecosystem.
In March 2020, it launched REco, a portfolio of power supply options derived from renewable sources for corporate customers.
REco ensures that the electricity supplied to our customers' facilities is renewable by adding Non-Fossil Fuel Energy Certificates to the electricity it provides. The portfolio contributes to CO2 emission reduction and ensures Rakuten's partners, such as Rakuten Ichiba merchants and Rakuten Travel hotels, operate their businesses with 100% renewable energy.
Climate Risks and Opportunities
Climate-related risk assessment is managed as part of Enterprise Risk Management (ERM), Rakuten Group's risk management framework. Below are some of the important risks and opportunities organized by reporting segment.
|Risk & Opportunity Type||Risk||Opportunity||Segment|
|Transition risk||Policy and Legal||Increased tax due to carbon tax||●||●||●|
|Technology||Decreased competitiveness due to lower efficiency and quality of mobile networks||●|
|Market||Decreased competitiveness due to higher procurement costs for environmentally friendly products||●||●|
|Business expansion through increased demand for environmentally friendly products and services||●||●||●|
|Reputation||Loss of Rakuten Group brand image due to failure to transition to a decarbonized society||Enhancement of the Rakuten Group's overall brand image through successful transition to a decarbonized society||●||●||●|
|Physical risk||Acute||Delays in shipping and delivery of products purchased by customers on our platforms due to specified disasters||●||●|
|Increased insurance payments due to large-scale typhoons, torrential rains, etc.||●|
|Enhanced customer trust resulting from a resilient platform and expansion in business through the platform||●||●||●|
|Chronic||Decline in demand, continuity and quality of products and services due to rising sea levels and chronic heat||New demand for goods and services due to sea level rise and chronic heat||●||●||●|
Partnerships & Initiatives
We are proud to be part of multiple domestic and global frameworks.
We aim to reach our climate change goals through close collaboration with relevant organizations across the world.
Rakuten Group, Inc. joined the international initiative RE100 in December 2019. We committed to switching to 100% renewably sourced electricity through the initiative for all Rakuten Group, Inc. business operations. In FY2021, this commitment was achieved and we aim to adopt 100% renewable electricity by 2023 for all Group operations.
We officially supported the Task Force on Climate-related Financial Disclosures (TCFD) in December 2019 and adopted TCFD's. recommendations in our risk mitigation strategies. We consider a range of scenarios and map out the risks across our businesses.
For Climate-related disclosure based on the TCFD recommendation, see the TCFD Index.
Japan Climate Initiative
The Japan Climate Initiative (JCI) is a network of Japanese private organizations actively engaged in climate action. We joined JCI in December 2019, pledging to stand at the forefront of society's as envisioned in the Paris Agreement.
CDP is widely recognized as the global standard for climate-related information disclosure, with over 13000 respondents worldwide. We have been responding to the CDP Climate Change survey since 2017.
See our response to CDP Climate Change 2023
JANE: Carbon Neutral Working Group
Ever since Rakuten's founding, the company has been an active member of JANE's carbon-neutral working group.
JANE (the Japan Association of New Economy) is a trade association, and its working group provides opportunities for dialogue and information-sharing among JANE's member companies. Rakuten holds regular study sessions and makes policy proposals incorporating other member companies' voices.