Grade summary

Compared to last year, Mitsubishi Chemicals has lost five points and fallen from 9^th to 30^th position. Based on available data, the company produces 11 hazardous substances, out of which one is persistent. However, there is no available data for the 74 percent of the company’s production that is sold outside of the EU or the US. Mitsubishi Chemical assesses the environmental impacts and hazards of its products, but has no program for phasing out its hazardous chemicals. In addition, the company loses three points in the Lack of Controversies category for an increase in legal penalties, now surpassing one million USD between 2011 and 2020.

How did we come to this score?

Opportunities for improvement

1. Map and phase out persistent chemicals
   Based on the available data, Mitsubishi Chemicals produces one persistent chemical, compared to zero last year. These substances are also known as “forever chemicals” due to the fact that they do not break down in nature. Instead, these chemicals — which are linked to many negative health effects — build up over time. The consequences of these substances are becoming increasingly detrimental, not only for human health and the environment but also for investors. Investors risk stranded assets now that the regulatory speed is accelerating, and are also exposed to significant liability risks since more chemical companies are being sued for contamination. The company should publish a time-bound phase-out plan for the persistent chemical and confirm that they have a completely persistent-free portfolio.
2. Reduce hazardous portfolio
   Scientists agree that chemical pollution has crossed a planetary boundary and become an urgent global problem. This threatens the stability of global ecosystems upon which humanity depends, by damaging the biological and physical processes that underpin all life. Mitsubishi Chemical now has 11 hazardous chemicals in its product portfolio, almost twice as many as last year’s six. A paramount improvement point for the company is therefore to reduce this number. The company should make sure to identify all uses, and publish volumes and the percentage of total revenue of its hazardous substances. It should also publish a reduction road map of each hazardous chemical and an annual progression report. If the company continues to produce any hazardous substances, it needs to present a rationale for its essential use, motivate the production volume, and state how much money it spends on research and development to find a safer alternative.
3. Increase transparency
   A lot is unknown about Mitsubishi Chemical’s production of hazardous chemicals. We have requested that the company disclose information about its chemicals management, but the company has not responded to that request. In order to be more transparent, Mitsubishi Chemical should disclose the full list of hazardous chemicals that it produces, including the volume of each of these chemicals as well as its percentage of the total revenue. It would also be wise to specify which chemicals are intended for end products and for intermediate use. Generally speaking, information about chemicals sold in EU and US markets is available through public records, which is not the case in other parts of the world. For that reason, the company should make the details of its revenue generated outside of these regions public to ensure chemical transparency and allow for a comprehensive global evaluation.

Category breakdown