Sustainability

The TOMY Group has identified “responding to climate change” and “promoting eco-conscious package/product designs” as materiality to fulfill its Sustainability Vision 2030, “A creator of quality Asobi that promotes the sustainable well-being of society.” We are advancing initiatives across our entire Group value chain toward “coexisting with the global environment.”

We recognize that making sure we pass on sustainable local communities and global environments to future generations in which children can smile and enjoy playing with toys is a critical issue for the TOMY Group. We have set “We will be considerate of resources and the natural environment” as part of ONE TOMY's Promise, which outlines specific actions that all employees of the TOMY Group should uphold. In accordance with our TOMY Group Environmental Policy, we are working to reduce the environmental impact of our business activities, engage in environmental conservation activities, plan and develop environmentally conscious products such as Eco Toys. Through these efforts, we support next-generation education initiatives that raise awareness among children about green purchasing.

In recent years, addressing petroleum-based plastics has become a growing concern. The TOMY Group recognizes this as an important challenge in reducing environmental impact and realizing a sustainable society.
Plastic's inherent properties of being lightweight, durable, and safe, combined with its freedom in coloring and molding, expand the possibilities for Asobi. Therefore, plastic is an indispensable material for making toys.
However, it has been pointed out that excessive use and improper disposal of plastics cause serious impacts on marine and land ecosystems.
The TOMY Group is advancing initiatives aimed at realizing a resource-recycling society through reducing single-use plastics in packaging materials, continuous efforts in researching and conducting verification tests on sustainable materials for products, and reusing and properly processing waste, and will disclose progress going forward.

The TOMY Group's business activities depend on and impact nature in diverse ways, including the use of various resources such as petroleum-based plastics and product planning inspired by nature. Therefore, we recognize that our relationship with natural capital, such as water resources, soil, and ecosystems, is a critical issue for our Group.
Accordingly, with the aim of clarifying the relationship between the TOMY Group's business and natural capital, we have identified our dependencies and impacts on nature within our business and analyzed and evaluated the associated risks and opportunities based on the framework recommended by the Taskforce on Nature-related Financial Disclosures (TNFD).

Going forward, we will continue to advance initiatives aimed at realizing a resource-recycling society. We will also strive to grasp risks and opportunities related to natural capital and achieve disclosure aligned with TNFD recommendations.

We advance initiatives based on the TOMY Group Environmental Policy.

We conducted an analysis using the LEAP approach to clarify the relationship between the TOMY Group's business and natural capital.

We used ENCORE to investigate TOMY Group's dependencies and impact on natural capital across all businesses and the value chain.

The ENCORE survey results revealed our dependencies and impacts on natural capital. Given the nature of the Group's business, which heavily utilizes plastic as a raw material, we recognized the significant impact of water pollution caused by plastic waste throughout the entire value chain. We also found that our own business activities depend on cultural services (art), such as product planning inspired by nature.

Heatmap for Dependencies and Impacts on Natural Capital

We identified natural capital risks and opportunities for the TOMY Group based on results such as the heatmap for dependencies and impacts created using ENCORE analysis results.

Identified Risks and Opportunities (as of October 2025)

The TNFD requires analysis of physical risks related to water resources and the importance of biodiversity to identify and evaluate natural capital issues (dependencies, impacts, risks, and opportunities).
In addition, from among the physical risks identified for the TOMY Group, we have identified risks such as production suspensions due to natural disasters, loss of distribution networks and in-store sales opportunities, and increased raw material procurement costs due to water scarcity. Therefore, we conducted risk analysis using Aqueduct and IBAT for manufacturing bases of TOMICA, PLARAIL, and LICCA, which are long-selling products representing our major brands.

Based on these results, we selected six bases within our Group with high dependency and impact, as well as high water-related risks, as priority bases. With regard to biodiversity risks, after obtaining analysis results from IBAT and information on proximity to protected areas, we have confirmed that no protected areas exist within a 5km radius of the bases.

Aqueduct Analysis Results for Priority Bases with Water-related Risks

• * Based on Aqueduct's evaluation criteria; drought risk is rated on a 5-point scale (High/Medium-high/Medium/Low-medium/Low), while other items use a 5-point scale (Extremely High/High/Medium-high/Low-medium/Low).

Results of Interviews with Priority Bases and Evaluation

We conducted interviews regarding water-related risks at priority bases. For these interviews, we confirmed past incidents and countermeasures for items determined to be high risk by Aqueduct.

Company Business Activities (Thailand)

We confirmed instances where operations were suspended due to flooding caused by typhoons in 2011. However, countermeasures to prepare for flooding have since been implemented across the entire industrial zone, including the installation of 5-meter-high water barriers and drainage pumps, as well as a dam monitoring system during the rainy season. As a result, we confirmed that there has been no flood damage since 2011.
In addition, we confirmed that there have been no occurrences of drought or water outages in the past, and that wastewater treatment is also being managed appropriately.

Upstream Supply Chain (Vietnam)

We confirmed instances where operations were suspended at bases B, C, D, and F due to flooding caused by typhoons in 2024. We confirmed the reinforcement of physical countermeasures such as sandbags as subsequent countermeasures to prevent flooding. There were no instances of operational suspension at base E.
In addition, we confirmed that there have been no occurrences of drought or water outages in the past, and that wastewater treatment is also being managed appropriately.

Based on the above results, although we confirmed instances where operations had been suspended due to flooding, we assessed the risk as low since appropriate countermeasures had been subsequently implemented.
In light of the increasing severity of natural disasters, we will continuously review countermeasures and conduct surveys at other bases as necessary going forward.

Based on the content in Assess, we have organized the TOMY Group's measures for responding to risks and opportunities, focusing primarily on initiatives currently underway.

Measures for Responding to Risks and Opportunities

These are initiatives currently underway, linked to the identified risks and opportunities.

Promoting Eco-conscious Package/Product Designs

● Eco Toys (development of environmentally conscious products)

The TOMY Group makes effective use of resources and strives to develop products that are considerate of the environment. “Eco Toys” are products that have cleared one or more of the ten 10 environmentally conscious “Eco Toy Standards” established by the Group-wide Eco Toys Committee with advice from third-party institutions. The “Eco Toys” mark is displayed on packaging to communicate environmentally friendly efforts to customers in an easily understandable way to spread green procurement initiatives in the toy market.

● Using Forest Certified Paper for Packaging

The TOMY Group is expanding its product lineup using forest certified paper for packaging, including for TOMICA, PLARAIL, and LICCA. Forest certified paper is paper made from raw materials such as wood produced from properly managed certified forests, or recycled paper certified by a third party. Choosing certified paper leads to environmental conservation, such as the protection of forest resources, and the effective use of paper resources.

● Simplifying Packaging to Reduce Plastic Use

We are reducing the use of disposable plastic by eliminating the plastic (PET material) used in packaging for some products in a way that does not detract from the appeal of the product.

● Easy-to-Remove, Easy-to-Sort Packaging

We have started using staple guns instead of bands to fix our Transformers and other products into their packaging. The staples can be easily cut and removed at home with scissors.

● PVC-free

We strive to use non-polyvinyl chloride (PVC) packaging materials to minimize the impact on the environment when the waste packaging is incinerated.

Reducing Our Environmental Footprint

● Reducing environmental impact during the manufacturing process

To reduce environmental impacts within our business activities, the TOMY Group strives to utilize waste generated from business activities as resources whenever possible, while, of course, observing the law and disposing of materials appropriately.
TOMY TEC, which owns a factory in Japan, recycles some of the plastic runners discharged during plastic molding. It also sorts metal scraps generated from molding and wheel machining, and then sells those scraps to recycling companies to reduce overall waste.

● Reducing environmental impact during distribution

While we promote the use of paper resources to reduce plastic, we are also working to reduce the use of cardboard and paper resources in distribution from the perspective of protecting forest resources. We use 100% recycled paper for cushioning materials and, for some shipments, use Oricon (reusable, foldable containers) instead of cardboard boxes.

Social Contribution

● Activities supporting next-generation education for children who will shape the future

TOMY Company conducts visiting classes across Japan for elementary and junior high school students that use toys as teaching materials. Employees themselves serve as instructors, focusing on themes like the environment and building a society of coexistence. We offer programs that foster a spirit of contributing to the community and encourage students to take action by making them view environmental issues as their own responsibility through our Eco Toys, which are thoughtfully designed so that they can be made and played with in an eco-friendly manner, and our Group’s environmental initiatives.

Within the TOMY Group’s mid-term sustainability targets and KPIs (FY2024-2026), we are aiming to achieve a decarbonized society by reducing Scope 1+2 CO2 emissions, switching to renewable energy, reducing waste (appropriate inventory control, promotion of the 3Rs, reassessment of containers and packaging), and reducing petroleum-based plastics in products while promoting recycling. We have established material research, demonstration experiments, and progress disclosure, and will continue to advance these initiatives.
We are promoting efforts to achieve these targets and KPIs through two subcommittees (Climate Change and Eco-design) within the cross-departmental Environment Task Force overseen by the Sustainability Committee.

Environment Task Force

The TOMY Group reviews natural capital risks and impacts through the cross-departmental Environment Task Force and Human Rights Due Diligence Task Force, both overseen by the Sustainability Committee. We will develop strategies and share them with business divisions and Group companies.

*See task forces in the Promotion Structure diagram.

The Group has been striving to prevent and minimize risks in the event of an emergency with measures such as engaging in environmental initiatives through our business and establishing a Business Continuity Plan.

The TOMY Group has identified “responding to climate change” and “promoting eco-conscious package/product designs” as materiality, setting mid-term sustainability targets and KPIs (FY2024-2026) to promote initiatives.

Medium-term Sustainability Targets/KPIs(FY2024-2026)

We aim to build a circular economy for toys and Asobi by promoting response to climate change and the eco-conscious design of products and packaging throughout the entire value chain of our Group in order to protect an environment where children can play with a smile even 100 years from now.

The TOMY Group indicated its participation for the United Nations Global Compact, the international framework for the global community to achieve sustainable growth. The Group will promote initiatives to achieve the 10 principles of the Global Compact that cover the areas of human rights, labour, the environment and anti-corruption.