Environmental Policy・Environmental Targets・Achievements

Environmental Policy

Basic Philosophy on Environmental Initiatives

SMFL Group recognizes addressing global environmental issues as an important social responsibility and a fundamental pillar supporting sustainable growth.As environmental challenges such as climate change, resource constraints, and biodiversity loss become increasingly severe, we aim to contribute to solving social issues through our business activities and to realize a virtuous cycle between the environment and the economy. Leveraging the characteristics of each Group company and business, we promote initiatives that balance the reduction of environmental impact with the creation of environmental value, thereby contributing to the realization of a sustainable society together with our stakeholders.

Environmental Policy

１．Contribution to Environmental Challenges through Business
SMFL Group contributes to the realization of a decarbonized society and a circular economy by providing products, services, and solutions that reduce environmental impact, as well as by promoting the effective use of facilities and resources. We also work with business partners and other stakeholders to reduce environmental impact across the entire supply chain.

２．Reduction of Environmental Impact in Our Own Business Activities
SMFL Group strives to continuously reduce the environmental impact of our business activities by promoting resource and energy conservation, reducing greenhouse gas emissions, and preventing waste generation while advancing reuse and recycling.

３．Compliance with Laws and Response to International Trends
SMFL Group complies with environmental laws and regulations and proactively pursues higher standards of environmental initiatives in response to international environmental trends and social expectations.

４．Promotion of Environmental Management and Continuous Improvement
To implement this policy, SMFL Group establishes environmental objectives and  targets for the Group and each company, and ensure continuous improvement of our environmental management through periodic evaluation and review.

５．Group-wide Awareness and Information Disclosure
SMFL Group strives to ensure that this policy is thoroughly communicated to officers and employees throughout the Group to enhance environmental awareness and promote action. We also place importance on dialogue with stakeholders and provide appropriate and transparent disclosure regarding our environmental initiatives.


Tetsuro Imaeda
President
Sumitomo Mitsui Finance and Leasing Co., Ltd.

SMFL Group Sustainability Action Plan

SMFL Group has its Environmental Policy, clearly articulating its commitment to contributing to the resolution of global environmental issues. In April 2020, the SMFL Group further positioned becoming a company "Chosen for its commitment to SDGs" as one of the Our Vision statements under the SMFL Way, and has since implemented a wide range of related initiatives.
In April 2026, the SMFL Group newly formulated the SMFL Group Sustainability Action Plan, an environmental plan aligned with the Paris Agreement. Under this Action Plan, the SMFL Group has set gross GHG reduction targets aimed at achieving carbon neutrality by 2050. By declaring its commitment to carbon neutrality in 2050, the SMFL Group will promote ambitious, backcasting-based initiatives across the entire group.
At the same time, the SMFL Group has also established targets to contribute to the reduction of Scope3 emissions and GHG emissions in society, and will accelerate initiatives that contribute to reducing Scope3 emissions throughout the entire supply chain.

2030

Reduction of Scope 1 and 2 by 42% (compared to FY2024) across the consolidated group

Targets contributing to the reduction of
Scope3 and GHG emissions in society

Targets to contribute to Scope3 reduction

Aircraft

・Increasing the ratio of new-technology fleet to 80% or more

Real estate

・Implementation of calculation and disclosure of Scope3 Category 13 for real estate owned by SMFL+SMFL MIRAI Partners

Targets to contribute to reducing GHG emission in society

Global Environment

・Achieving 1.5 GW of domestic solar equity power generation output

Action plan for contributing to GHG reduction
  • Measuring the contribution to GHG reduction in Circular Economy Business
  • Promotion of SAF business initiatives through inter-divisional and inter-group cooperation

2050

Achieving carbon neutrality (Scope1, 2, 3)

Please refer to the following for the results of environmental targets up to fiscal 2025.（PDF : 1.7MB）

GHG Emissions Data

In addition to the measurement and disclosure of Scope1 and Scope2 emissions, society is demanding the disclosure of Scope3 emissions, which cover indirect emissions from sources other than a company itself. SMSL has been calculating data for certain categories within Scope3 (refer to the following table) since FY2023. Moving forward, we will work on expanding both the categories and the scope of disclosure.

FY2023 and FY2024 consolidated GHG emissions
t-CO2e FY2023 FY2024
Scope1
*1 *4		 Consolidated total 2,665 3,223
Of which SMBC AC 1,541 2,414
Scope2
*2 *3 *4		 Market-based 2,034 1,309
Location-based 3,984 3,523
Scope3 Category 1 (purchased goods and services) 41,252 46,728
Category 2 (capital goods) 5,084,865 5,199,682
Category 3 (fuel- and energy-related activities) *3 797 624
Category 5 (waste generated in operations) *5 *6 *7 32 142
Of which office waste 3 11
Of which business asset waste 29 131
Category 6 (business trips) *8 5,589 12,998
Category 7 (employee commuting) *8 719 1,105
Category 13 (lease assets (downstream)) *9 17,276,999 17,627,922
Of which aircraft 16,241,114 16,755,224
Of which other transportation equipment 1,035,885 872,698
  • *1 In principle, we use the emission factors published in the Greenhouse Gas Emissions Accounting, Reporting and Disclosure System under Japanʼs Act on Promotion of Global Warming Countermeasures to calculate Scope1 emissions.
  • *2 In principle, we use the provider-specific emission factors; otherwise, we use the country-specific emission factors published by IEA to calculate Scope2 emissions.
  • *3 Due to the review of the calculation boundary, Scope2 emissions for FY2023 were revised.
  • *4 SMFL Group has obtained third-party assurance for its Scope1 and 2 emissions for FY2024.
  • *5 Emissions that were recorded as category 12 from FY2023 have been reclassified as category 5 in line with the revision to methodology.
  • *6 Data is complied from companies for which data is available.
  • *7 FY2023 data is calculated for SMFL and domestic affiliates occupying the following offices (Tokyo Head Office, Osaka Head Office, Takebashi Office).
  • *8 FY2023 data is calculated for SMFL and SMFL MIRAI Partners Co., Ltd.
  • *9 Scope3 Category 13 is calculated based on aircrafts owned by SMBC AC and other transportation equipment under lease contracts with SMFL and may increase in the future as assets subject to calculation expand.

Assurance

SMFL Group's Scope1, 2 emissions are obtained independent limited assurance performed by KPMG AZSA Sustainability CO., Ltd.

Fiscal Year Independent Practitioner's Assurance Report
2024 Assurance Report（4.5MB）

Energy Consumption

Type of energy Non-consolidated Consolidated
2021 2022 2023 2024 2023 2024
Gasoline [kL] 338 326 274 209 457 321
Jet fuel [t] - - - - 286 448
Diesel fuel [kL] 0 0 2 3 6 4
City gas [thousands m³] 25 23 23 24 30 31
Electricity [MWh] 1,915 1,979 2,272 2,369 8,895 8,045
Of which renewable electricity [MWh] 0 1,880 2,135 2,223 4,471 5,316
Renewable energy ratio (%) 0 95.0 94.0 93.8 50.3 66.1
Cooling water [GJ] - - - - 616 572
  • ※ Renewable electricity includes the amount of non-fossil fuel certificates purchased.

Estimates of Avoided Emissions

Aiming to create social value and expand economic value, we began measuring our contribution to avoided emissions as an impact indicator that reflects the influence of our business activities on society and the environment from FY2020. Having recorded 510,000 t-CO2 from renewable energy generation projects in FY2024, our avoided emissions has remained on an upward trend. Including general leasing transactions, the total avoided emissions amounted to 1,190,000 t-CO2. Going forward, we will work to increase our avoided emissions throughout the supply chain, including power generation, storage, and energy conservation, and thereby contribute to the realization of a decarbonized society.

Avoided emissions

Stacked bar chart showing avoided CO<sub>2</sub> emissions from FY2020 to FY2024, measured in 10,000 t-CO<sub>2</sub>. Two categories: dark blue for renewable energy power generation business and light blue for general leasing. Values: 9.5 in 2020, 16.2 in 2021, 105.0 in 2022 (79.3 leasing, 25.7 renewable), 114.1 in 2023 (76.0 leasing, 38.1 renewable), and 119.1 in 2024 (68.6 leasing, 50.5 renewable). Note: general leasing included from FY2022.

Method of calculating avoided emissions
Renewable energy business General leasing
Scope of calculation In-house power generation (including PPA), financing and project finance projects handled by the Global Environment Business Unit General leasing projects for renewable energy equipment handled by the Corporate Business Unit
Applicable power generation methods Solar power, wind power, hydro power, biomass, geothermal Same as on the left
Calculation method Avoided emissions are calculated by multiplying our share of power generation in each fiscal year by the International Energy Agency (IEA) emission factor. Avoided emissions are calculated by multiplying the power generation capacity determined by a specific logic, capacity utilization rate and the IEA emission factor.

Targets related to Japan's Act on the Promotion of Plastic Resources Circulation

In response to the Act on Promotion of Resource Circulation for Plastics, which came into effect in April 2022, SMFL set two key targets. The first target, announced in June 2023, focuses on reducing the disposal of plastic office supplies used in business activities, and the second target, announced in March 2024, addresses the reprocessing of properties at the end of their leases.

Target 1 Reduction of plastic office supplies used in business activities (Achieved)

  • Recycle 100% of used clear files by FY2025
  • Ensure that 100% of newly purchased clear files are made from non- plastic materials by FY2025

Target 2 Reprocessing of lease-end assets

  • Resource recycling ratio ※ Maintain the 92.8% result achieved in FY2022
  • ※The resource recycling ratio is the sum of the re-leasing rate for lease agreements, the ratio of end-of-lease properties sales, and the recycling ratio of end-of-lease properties. This indicator is aimed at promoting resource circulation by maximizing the reuse and recycling of leased properties.

Resource recycling ratio
FY Resource recycling ratio（%）
2020 92.0
2021 91.5
2022 92.8
2023 91.9
2024 92.0

In-house initiatives

Since December 2023, SMFL's clear files are converted into paper-based materials which can be collected for recycling. Through the repetitive in-house use of plastic clear files we have achieved target (1).

In addition, we have replaced approximately 20,000 plastic PET bottles used in service of our customers at locations in Japan annually with PET bottles made of aluminum and steel from FY2024.