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GHG Emissions Management in the Steel Supply Chain
Our Approach
Visualization of CO2 emissions

The Sumitomo Corporation Group has identified “Overcoming Climate Change” as one of its six material issues and has been advancing initiatives to reduce greenhouse gas (GHG) emissions across its operations.
As part of this commitment, the Group has set a long-term goal of achieving carbon neutrality in its business operations by 2050.
In February 2026, following the completion of Scope 3 emissions calculations for the entire Group and in anticipation of the application of the Sustainability Standards Board of Japan (SSBJ) disclosure standards, the Group updated its emissions reduction targets to align with the categorization framework of the GHG Protocol.
Using FY2024 as the baseline year, the Group aims to:
・Reduce emissions by 30% by FY2035, and
・Achieve carbon neutrality by 2050
across the following categories:
・Scope 1
・Scope 2
・Scope 3 (Category 13 and Category 15)
As a member of the Sumitomo Corporation Group, Sumitomo Corporation Global Metals Co., Ltd. (SCGM Group) is actively working to measure and manage emissions across the steel value chain.
Since 2021, the SCGM Group has been working to establish a GHG emissions inventory for the steel supply chain, while also advancing initiatives such as:
・reducing Scope 1 and Scope 2 emissions within its own operations
・utilizing carbon credits to offset operational emissions
・improving the accuracy and transparency of Scope 3 emissions calculations
Through these initiatives, the Group aims to contribute to the decarbonization of the steel industry, which is widely recognized as one of the most emissions-intensive sectors globally.

FY2024 GHG Emissions

Total GHG emissions of the SCGM Group for FY2024 amounted to:1,911,242 t-CO₂
(Scope 1, Scope 2, and Scope 3 – Category 1 and Category 4)
For Scope 1 and Scope 2 emissions attributable to SCGM on a standalone basis, the company purchases and retires carbon credits equivalent to the emissions generated. However, the figures disclosed here do not deduct the volume offset by these credits, to ensure transparency.

More than 99% of total emissions fall under Scope 3 Category 1, which represents emissions embedded in purchased goods and services.
These emissions primarily arise upstream in the steel production process and therefore lie largely outside the direct operational control of the SCGM Group.
As a company engaged in global steel distribution, SCGM recognizes the importance of quantifying and visualizing emissions throughout the supply chain. Establishing visibility over supply chain emissions is a critical first step in supporting the steel industry’s transition toward lower-carbon production pathways.
At the same time, demand for low-carbon and green steel products has begun to emerge in certain markets. The SCGM Group believes that facilitating the distribution and wider adoption of such products will play an important role in accelerating decarbonization across the steel value chain.
Previously, Scope 3 emissions were calculated based on an internally developed methodology, and the results were subject to independent third-party assurance by KPMG AZSA Sustainability Co., Ltd.
However, as Sumitomo Corporation has now completed the development of a unified GHG accounting framework and begun disclosing emissions data for the entire Group, the SCGM Group has aligned its calculation scope and methodology with those used by Sumitomo Corporation beginning in FY2024.
As a result of this transition, Scope 3 emissions data for prior years are indicated as N/A due to differences in calculation boundaries and methodologies.
Sumitomo Corporation obtains independent third-party assurance for its emissions data as follows:
Scope 1 and Scope 2：KPMG AZSA Sustainability Co., Ltd.
Scope 3：SOCOTEC Certification Japan Co., Ltd.

Further information can be found on the Sumitomo Corporation sustainability website.
Environmental-related data | ESG Data | Sustainability | Sumitomo Corporation

  • Data Boundary

    The organizational boundary for emissions data collection is defined as follows:
    Scope 1：SCGM (standalone) and four consolidated subsidiaries
    Scope 2：SCGM (standalone) and four consolidated subsidiaries
    Scope 3- Category 1：Procurement volumes associated with proprietary trading transactions conducted by SCGM and its four consolidated subsidiaries
    Scope 3 -Category 4：Transportation arranged by the SCGM Group in proprietary trading transactions, including land and ocean transport from domestic steel manufacturers to overseas ports of discharge.
    Transportation cases with estimated annual emissions of 500 t-CO₂ or less per shipment are excluded from the calculation.

  • Calculation Methodology

    Scope 1 and Scope 2

    Scope 1 and Scope 2 emissions are calculated by multiplying energy consumption at each operational site by the relevant CO₂ emission factors.
    Energy consumption is determined based on purchased volumes of the following energy sources:
    ・Electricity
    ・Chilled and hot water
    ・Gas
    ・Kerosene
    ・Diesel fuel
    ・Gasoline
    For certain locations, gasoline consumption is estimated using either:
    purchase expenditure and national average gasoline prices, or travel distance and average fuel efficiency.

    Emission Factor Sources

    Scope 1
    Domestic and overseas operations
    Emission factors from the Ministry of the Environment of Japan’s Calculation, Reporting and Disclosure System Scope 2
    Electricity emission factors:
    SCGM (standalone) FY2024: Supplier-specific basic emission factors (adjusted for non-fossil energy sources)
    FY2021–FY2023: Adjusted emission factors     Domestic consolidated subsidiaries
    Average emission factor for all power sources (receiving-end basis) Overseas operations
    Country-specific emission factors published by the International Energy Agency (IEA) Emission factors for non-electricity energy sources are based on the Greenhouse Gas Accounting and Reporting Manual issued by the Ministry of the Environment.

    Scope 3

    Category 1 – Purchased Goods and Services
    Emissions are calculated as:
    Procurement volume × emission factor
    For certain products from domestic steel manufacturers, emission factors are derived from Environmental Product Declaration (EPD) data published by the Sustainable Management Promotion Organization of Japan. Where such data is unavailable, including for some domestic and overseas steel products, emission factors from the World Steel Association Sustainability Indicators 2024 report (BF-BOF route) are applied.
     Category 4 – Upstream Transportation and Distribution
    Emissions are calculated as:
    Procurement volume × emission factor by transportation mode
    Emission factors are based on the UK Government GHG Conversion Factors for Company Reporting.

Looking Ahead

Since its establishment in 2003, the SCGM Group has operated in a rapidly evolving global market with a spirit of innovation and a commitment to creating new value through the steel business.

Climate change mitigation represents one of the most pressing global challenges, and the steel sector is widely recognized as a hard-to-abate industry with significant decarbonization challenges.
As a global steel trading and distribution group, SCGM is committed to：advancing decarbonization within its own operations, and supporting the transition of the steel industry by facilitating the global distribution of low-carbon steel products.
By collaborating with steel manufacturers and responding to emerging demand for lower-carbon materials worldwide, the SCGM Group aims to contribute to the industry-wide transition toward carbon neutrality.
Looking ahead, we will continue to respond proactively to societal change and work together with our customers, business partners, and all stakeholders to create sustainable value and contribute to the realization of a more sustainable society.