Climate Change Risk Management

The Fujitsu Group operates a group-wide risk management system to identify, prevent, and mitigate a variety of potential risks, in accordance with Fujitsu’s risk appetite. This risk management approach includes issues related to climate change and other environmental issues.

By addressing the physical and transitional climate risks that impact upon Fujitsu’s operations, supply chains, and customers, though implementation of appropriate mitigation and adaptation strategies, we can reduce loss and generate significant value throughout our value chain associated with the transition to a more sustainable world. Learn more about our climate targets on our website.

Fujitsu takes a methodical and structured approach to climate risk. Framed by the Taskforce for Climate Related Financial Disclosures (TCFD) framework, climate related risks and opportunities are captured, analysed and incorporated into Fujitsu’s risk management framework. To read more about our Governance, Strategy, Risks, Metrics and Targets at Fujitsu Group level please refer to our Fujitsu Group TCFD disclosure.

Climate risks and opportunities in Fujitsu Australia and New Zealand

Continuing the important work done at the Fujitsu Group level, Fujitsu Australia and New Zealand (FANZ) has been building upon this foundation with region-specific climate risk and opportunity management. Commencing in 2019 and refined most recently in 2023, this region-specific assessment of risks, opportunities and related actions is an integral part of our FANZ’s climate action strategy, which informs our responsible business growth strategy.

Our 2023 climate risk and opportunity workshop included key internal stakeholders from across our business, including:

Finance
Facilities
Business Resilience
Procurement
Data Centres
Field Services
Health, Safety and Well-being
Legal & Compliance
Technology & Innovation
Sales and Customer Service
People & Culture
Office of Purpose

Beyond identification of climate risks and opportunities, we are heavily focused on integration into existing management frameworks for traceability, consistency, and accountability. In the ANZ region, data centre operations, warehousing and distribution services are important parts of our business operations. To gain insights into potential exposure of these assets and some dependent infrastructure to various physical climate risks such as heat stress, flood risk and soil movement, we engaged a third-party climate risk consultant - XDI (Cross Dependency Initiative). By using XDI’s analysis, we gained important insights into the vulnerability of these assets to short-term and long-term physical climate change events out to 2100.

Climate risks table

Risks identified during our FANZ 2019 and 2023 workshops were found to align with those risks identified at Fujitsu Group level, as represented in the below table. Some risks were found to be more material in the context of our FANZ business operations. In these instances, we have added additional context and detail on risks and mitigation measures as they relate to FANZ operations.

Fujitsu Climate Risk Summary - Global and ANZ Region

Risk type		Term	Global Risks	FANZ context	Key risk controls and mitigation and approaches
Transition	Policy/ Regulation	Term	Global Risks	FANZ context	Key risk controls and mitigation and approaches	Short-to long-term	Increased costs due to stronger laws and regulations relating to greenhouse gas emissions and energy use (carbon taxes, energy-saving policies, etc.) Risk of lost corporate value if such laws or regulations are violated	Ongoing reductions in greenhouse gas emissions (increased use of renewable energy, comprehensive energy savings) Strict compliance with laws and regulations through EMS Additional FANZ detail: Compliance with laws and proactive management of climate policy changes through FANZ' risk management approach, including Fujitsu's FANZ ELT Net Zero Steering Committee and Asia Pacific-level Risk Management Committee.
	Market	Medium and long-term	Surging electricity prices with the shift to a carbon-neutral world (widespread electrification, etc.)	This risk is particularly relevant to Australia due to price volatility as the National Electricity Market transitions from fossil-fuel dominated generation to firmed renewables. This risk has high relevance to Fujitsu's Australian operations, in particular to our data centre customers.	Reduced electricity consumption by formulating internal company standards and developing innovative technology, etc. Additional FANZ detail: Identification of energy efficiency, and cost reduction opportunities through the FANZ Data Centre Sustainability Working Group. Development of FANZ climate transition plan that reflects the needs of customers for low-carbon, cost effective products and services offerings.
	Technology	Medium and long-term	Risk of missing out on business opportunities if we fall behind in fiercely competitive technology development (energy savings, low-carbon services, etc.) and cannot meet market needs		Promote innovation and develop products/services that address customers' climate change issues
	Reputation	Short-to long-term	Increased cost of responding to demands from stakeholders (investors, customers, etc.) Negative impacts on ratings and sales due to delays in responding to external demands		Formulation and promotion of our Medium/Long-term Environmental Vision and Environmental Action Plan Proactive information disclosure to ensure transparency in our climate change strategy Additional FANZ detail: ongoing evaluation by FANZ of Australian and New Zealand regulatory approaches and societal expectations to minimise the risk of 'greenwashing' and 'green hushing' associated with environmental claims.
Physical (Natural disasters etc.)	Chronic/ Acute	Short-to long-term	Increased cost of responding to changing rainfall/weather patterns, higher average temperatures, higher sea levels, droughts, etc. Increased recovery costs when operations, including supply chains, stop due to increasingly severe abnormal weather events	Heat stress was identified as the most material physical climate stressor for our assets – which could lead to increased cooling requirements resulting in increased PUE, and which could cause disruptions to our workforce.	Implement measures such as greater multi-sourcing, stronger BCP measures, and conducting surveys of suppliers' business continuity systems Additional FANZ detail: Quantitative physical climate risk assessment (XDI) undertaken over strategic FANZ sites Focus of FANZ Data Centre Sustainability Working Group to drive continuous improvement in energy efficiency, including investigation into new technologies. Continual refinement of work health and safety management processes to minimise impact on workforce health. Assess potential water risks and undertake monitoring

Fujitsu Australia acknowledges all Aboriginal and Torres Strait Islander Traditional Custodians of Country and recognises their continuing connection to land, sea, culture, and community. We pay our respects to Elders past and present.