Sustainability

Sustainability Management

Orico's Sustainability Statement, promotion system, materiality, etc.

Orico's Sustainability Statement
Sustainability Management Structure
Materialities
The Process of Identifying Sustainability Initiatives
Sustainability Initiatives and Targets for FY2022-2024
Sustainability Report

Orico's Sustainability Statement

We, Orico, are committed to our corporate purpose: "Open the future with you". This represents our determination to be a partner, taking a genuine care and leading with enthusiasm, staying close to the present and the future status of each one of our stakeholders.

Our goal is to create a sustainable society in which everyone can realize a fulfilling life. We seek to solve various social challenges through the power of innovation and pass on a legacy of such a society to future generations.

To this end, as a trusted partner, we pursue both social value and corporate value by contributing to society through all of our corporate activities.

Sustainability Management Structure

Materialities

Contributing to Realize a Safe, Secure, and Convenient Cashless Society. Creating New Customer Experience Value through the Use of Financial Expertise. Contributing to Realize a Decarbonized and Circular Society. Contributing to Sustainable Community Development. Focusing more on diversity, employee-development, and work-style reforms. Strengthening governance.

The Process of Identifying Sustainability Initiatives

Our Company has established specific initiatives and KPIs in con junction with the medium-term management plan to address social issues through our business activities and to achieve our materiality, as outlined in the following process.
By advancing these initiatives, we are striving to generate new businesses that contribute to solving social issues and to drive organizational transformation, thereby achieving a balance between social and corporate value.

1. Identifying Materiality, We define our 10-year visions for society and of the Company, and identify key issues (mateiralities) that must be prioritized in order to achieve them. 2. Selection of Initiatives, To resolve social issues, we select materiality-related action items from among division/group strategies. 3. Analysis of Importance, Map the items based on stakeholder expectations and requests and importance to Orico's strategy, and identify high-priority items as a preliminary draft. 4. Decision on Initiatives Upon the Sustainability Committee's review and submission of a report to the Board of Directors, the President and Director decides.

Sustainability Initiatives and Targets for FY2022-2024

We aim to create social value and enhance corporate value by solving various issues using the PDCA (Plan-Do-Check-Act) cycle, which sets specific initiatives, targets, and KPIs for each materiality.

Contributing to the realization of a safe, secure, and convenient cashless society
Creating new customer experience value through the use of financial know-how
Contributing to a Decarbonized Society and Circular Economy
Contributing to Sustainable Community Development
Diversifying human resources and reforming work style
Strengthening Governance

Contributing to the realization of a safe, secure, and convenient cashless society

Initiatives	Key Performance Indicators (targeting March 2025)	Social Value/ Corporate Value Targets	Results and Initiatives in FY2023
Expanding the use of credit cards	Expand credit card membership base Strengthen promotion of debit cards Strengthen the promotion of acquiring Expand card shopping transaction volume to 3.3 trillion yen to achieve a cashless ratio of 40% in Japan by 2025 Transaction volume KPIs were revised in line with changes in the business plan in April 2024	Contribute to consumer convenience by promoting cashless payment through increased use of credit cards	Results Card shopping transaction volume: 3.12 trillion yen. Initiatives Increased the transaction amount of major existing co-branded credit cards such as Costco Global Cards and Mizuho Mileage Club Cards, and expanded the customer base by issuing new co-branded credit cards with original benefits granted..
Expand use of business cards	Strengthen promotion of business cards and loan products that meet customer needs	Contribute to improving the productivity of small and medium-sized enterprises and sole proprietors by promoting cashless payment in the business field.	Expanded the use of business cards among companies by promoting the Orico Business Payment for SME.
Provide new cashless payment services	Development of QR code payment (immediate use) Development of digital cards Develop BNPL as a new product	Through the development of new products and services, provide a variety of cashless means of payment and contribute to further convenience.	Introduced digital cards, which customers can apply and use on their smartphones, and Orico Code Payment and newly digital payment services to be available at credit card member merchants.
Strengthen information security measures	Strengthen measures against credit card fraud by introducing new tools utilizing digital technology.	Provide an environment where everyone can use payment services safely	Installed AI functions in unauthorized use detection systems, and prevented unauthorized use by expanding the 3D Secure authentication service. Obtained the Payment Card Industry Data Security Standards, an information security standard in the credit card industry.

Materiality

Creating new customer experience value through the use of financial know-how

Initiatives	Key Performance Indicators (targeting March 2025)	Social Value/ Corporate Value Targets	Results and Initiatives in FY2023
Automation of asessment operations	Promote web-based applications, automated asessment Digitalization of customer contact points (e.g., confirmation of contract intention via SMS, digitalization of various information) Advance AI credit checks for credit cards Double the rate of fully automated reception and screening operations to provide high quality services and improve customer convenience Credit card automation rate of 80% or more Total automation rate of 40% or more	Improve customer convenience, provide high-quality services, and increase productivity by promoting automation of business operations.	Results Credit card automation rate: 62% Overall automation rate: 30% Initiatives Promoted the automation of application and assessment operations through the digitization of customer contact points. Created a new customer experience with performance-based credit (AI credit checks).
Provide customer experience value through the use of digital technology.	Create new market-in type products and services Realization of embedded finance	Provide new experience value by developing innovative solutions utilizing digital technology	Launched several services through the digitization of new services and existing businesses.
Creation of new business models for ethical consumption	Develop a platform business on the theme of ethical consumption, including the environment.	Develop a platform business to promote ethical consumption and support consumers' efforts to solve social issues.	Continue to communicate with ethical-related business operators.
Develop new financial services in collaboration with financial institutions	Develop financial services through the use of AI and collaboration with fintech companies, etc. (data mining, personal loan matching, immediate screening)	Provide an environment where customers can easily select and use the most appropriate financial products through the development of new services	Provided services that help respond to needs from financial institutions or solve community problems (business outsourcing, personnel recruitment support, among others) in collaboration with business partners.
Digitalization of auto loans in Southeast Asia	Develop DX and digital strategies with a focus on future markets	Developing innovative applications using digital technology and shortening the time required for screening to improve convenience for customers and provide high-quality services.	Embark on the development of system platforms for digitization such as the development of applications and the introduction of credit scoring models.
Enhance Customer Experience—Implement Initiatives Based on the Voice of Customer	Improve web-based solutions. Optimize touchpoints. Improve application/billing process. * Initiatives were revised in November 2023.	Improve the relationship of trust with customers by enhancing the value of the customer experience in a variety of situations.	Renewed chat support system, introduce AI to increase the scope and accuracy of response. Renewed the e-Orico service entirely, improved operativity and visibility, and expanded such services as instant notification on card usage and temporary suspension/cancellation.
Support for improving literacy among young people, the elderly, and people with disabilities	Educational activities aimed at improving credit literacy among young people, the elderly, and people with disabilities Expand financial literacy education to elementary, junior high, and high school students Launch of credit literacy awareness web page and updating of content	Contribute to building a society where everyone has correct knowledge about money and can use financial services with peace of mind	Provided educational materials for financial programs to senior high schools across Japan. Offered an extracurricular social collaboration program at Hosei University.
Continuous implementation of ESG procurement	Continue to implement ESG procurement every fiscal year In addition to green bonds and social bonds, consider new methods such as sustainability bonds and sustainability-linked bonds/loans	Promote ESG procurement with the aim of contributing to the achievement of the SDGs, and provide products and services to customers on an ongoing basis	Engaged in ESG/sustainable finance with sustainability-linked bonds, loans, among others, for five consecutive years.

Materiality

Contributing to a Decarbonized Society and Circular Economy

Initiatives	Key Performance Indicators (targeting March 2025)	Social value/corporate value Targets	Results and Initiatives in FY2023
Reduction of greenhouse gas emissions and energy usage in business operations	Promoting the transition to eco-friendly vehicles (EV, FCV, HV, fuel-efficient vehicles) for company-owned cars. Reducing the total number of company-owned cars. Reducing CO2 emissions through the transition to eco-friendly vehicles and reducing gasoline usage by promoting online operations and decreasing travel distance. Reducing energy usage. Further introduction of energy-efficient and renewable energy equipment. Updating energy-efficient equipment in company buildings. Considering the adoption of renewable energy and equipment. An eco-friendly vehicle ratio of 75% or higher. Promoting the eventual shift to using eco-friendly vehicles for 100% of company-owned cars 10% reduction in the total number of company-owned cars 3% reduction in energy usage (based on original units) compared to FY 2021.	Contributing to a decarbonized society through the reduction of greenhouse gas emissions and energy usage.	Results Achieved 67.2% in the proportion of eco-friendly vehicles. Reduced total vehicles by 10.8%. Reduced energy consumption by 12.0%. Initiatives Continued to replace company vehicles with eco-friendly models when the leasing contract expires. Promoted car sharing. Promoted replacement of lighting equipment with LEDs and introduction of energy-saving air-conditioning equipment, among others, when updated.
Promoting a paperless business operation	Reducing paper usage through digitization. (Application forms, copy sheets (800 types), card issuance materials, business contracts for products, accounting documents) Reducing Orient Group's overall purchase of printing papers. Reducing appx. 800 tons of CO2 emissions per year. Reducing 15% purchase of printing paper compared to FY2021	By promoting the efficient utilization of limited resources throughout the Orient Group, we contribute to a circular economy/society	Results Reduced paper consumption equivalent to a reduction of 537 tons of CO2 emissions per year. Reduced copier paper by 16% compared to the fiscal year 2021. Initiatives Promoted the shift to web-based issuance of card statements, and digitization of card issuance materials. Disclosed the consumption status of copier paper and raised awareness of its reduction.
Expansion of EV and Promotion of Environmental Products	Collaborating with local dealers to spread the adoption of Vehicle-to-Home (V2H) technology. Utilizing the vehicle procurement network in the auto leasing business to promote the adoption of EVs in local communities. Introducing new schemes and products for environmental products such as solar power and batteries.	By promoting environmentally friendly products through financial services, we contribute to realizing a decarbonized and circular society.	Started full-fledged promotion of set loans for clean energy vehicles (CEVs). Promoted EVs using the vehicle procurement network. Launched campaigns aimed at promoting environmentally friendly products.
Expansion of EV and Promotion of Environmental Products	Contributing to the development of the EV market in Southeast Asia Monitoring market trends in Southeast Asia. Strengthening approaches to EV manufacturers and new car dealers.		Research remains underway on the trends and prospects of the EV market in the entire Southeast Asia.

Materiality

Contributing to Sustainable Community Development

Initiatives	Details and Key Performance Indicators (targeting March 2025)	Social Value/Corporate Value Targets	Results and Initiatives in FY2023
Using our expertise to provide financial products in Southeast Asia	Expansion of auto loan business Research market trends in each country and expand into new markets to increase market presence. Achieving a loan volume of 95.7 billion yen to contribute to civic life. Expanding the number of loan users to 37,000, including auto loans. * KPIs were revised in line with changes in the business plan in April 2024.）	By providing tailored services for each country, we contribute to the development of the automotive market in Southeast Asia.	Transaction volume: 81 billion yen. Auto loan contracts: 33,000.
Expanding credit provision to small and medium-sized enterprises (SMEs) and individual business owners.	Expanding Accounts Receivable Settlement Guarantee Business Full-scale deployment of guarantee factoring and development/release of purchase factoring. Exploring major partnerships through product improvements in "Smart Plan (debt assignment type). To further enhance the credit intermediation function in the local community, expand the transaction volume of accounts receivable settlement guarantees to 300 billion yen.	By providing a secure business transaction environment, we contribute to the revitalization of the local economy through support for SMEs and individual business owners.	Results Settlement guarantee transaction volume: 264.6 billion yen. * Includes accounts receivable settlement guarantee transaction volume by credit card. Initiatives Released Orico BtoB Factoring by GMO, a factoring service in which our clients can obtain funds quickly by selling accounts receivable. Renewed the portal site for member merchants of credit transfers and guarantee factoring.
Providing sustainable products through collaboration with regional financial institutions.	Developing sustainable products in collaboration with financial institutions (such as decarbonization-focused multipurpose loans). Partnering with more than 10 financial institutions to develop sustainable products that contribute to solving regional challenges.	We contribute to regional revitalization by offering financial products and services tailored to local challenges.	Results Tied up with 11 financial institutions. Initiatives Akikatsu Loan received the Nikkei Veritas Award at the 2023 Nikkei Superior Products and Services Awards.
Revitalizing the local economy through support for SMEs and individual business owners through financial products.	Collaborating with financial institutions to develop business loans and new services that contribute to regional revitalization (such as expanding companies' sales channels, business matchmaking). Introducing equipment and machinery to affiliated stores and providing finance leasing services.	By offering services that provide credit and business support to SMEs, we support the revitalization of the local economy.	Supported SMEs and individual business owners with financial products (small business loans and institutional lending). Provided support on capital investment to member merchants through leasing. Changed leasing products to expand support for non-member SMEs and small businesses.
Providing secure housing options.	Expanding the rental guarantee business Expanding partnerships with large-scale member merchants and influential local affiliated stores through collaboration with main operating branches. Addressing the industry-wide shift towards contract digitization.	We support the provision of secure housing not only in urban areas but also in rural areas, contributing to community development and regional revitalization.	Raised rent settlement guarantees by increasing the number of new member merchants. The introduction of electronic contracts was promoted and digitization of contract applications remained steady
Supporting regional revitalization through utilizing our company's resources.	Engaging in dialogue and collaboration with local governments through utilizing our leasing resources, including financial expertise, products, and services.	By partnering with local governments through the provision of our company's resources, we aim to address regional challenges	Concluded a comprehensive partnership agreement with Funabashi City in Chiba Prefecture and a partnership agreement with Fujimi City in Saitama Prefecture.

Materiality

Diversifying human resources and reforming work style

Initiatives	Details and Key Performance Indicators (targeting March 2025)	Social value/corporate value Targets	Results and Initiatives in FY2023
Creating an environment where diverse talents can thrive.	Raising awareness among manager candidates Creating an environment for women to succeed. We aim to promote the active participation of women and create an organization where diverse talents with unique characteristics can thrive. Female executive ratio (senior manager level or higher) Target for FY 2024: 28% or higher. Female executive ratio (department/ office manager level) Target for FY 2024: 12% or higher. * KPIs for March 2025 were revised upward in April 2024.	By promoting initiatives that leverage diversity, we will create an environment where each employee can work enthusiastically and thrive.	Results Female manager ratio (senior managers or higher levels): 27.6%. Female manager ratio (general manager level): 11.6%. Initiatives Deepened employee understanding through inclusion and diversity training programs.
	Promotion of paternity leave uptake among men. We continue to strive for a society where work-life balance is achievable for both men and women, aiming for a 100% paternity leave uptake among men.		Results Male childcare leave acquisition rate: 108.1%. Initiatives Distributed handbooks to eligible employees and their managers, and strongly encouraged them to take childcare leave.
	Utilizing surveys to enhance employee engagement. Improvement of Employee Engagement Score to BBB level. (3 ranks increase out of the 11 ranks from AAA to DD).		Results Employee engagement score B Initiatives Held meetings to share engagement survey results Shared problem analyses, countermeasures, good examples, future action plans, among others, and reflected them in initiatives
Expanding support measures for autonomous career development that cater to each employee's drive to grow	Meeting employees' drive to grow by expanding opportunities Providing opportunities to gain experience in other companies' overseas divisions or digital divisions. Offering opportunities for external side jobs and cross-border learning. Posting internal job openings within the company. Over 3 years, 200 employees have participated in new experiential programs both within and outside the company, including side jobs and trainee positions in startup companies.	Through the provision of diverse learning opportunities and platforms, we will foster employees who can excel in various situations.	Results Number of employees taking opportunities to work in and outside the company: 226. Initiatives The number of employees who practiced autonomous career development has increased gradually, with many applying for various related programs, indicating that a culture has been fostered to encourage employees to take on challenges. The number of employees who applied for the programs rose sharply, and our three-year target was achieved one year ahead of schedule.
	Expanding talent with DX skills (Promoting DX personnel). Developing DX talent development programs. Cultivation of DX culture. Expanding talent with DX skills (DX promotion personnel) to 3,000 individuals.		Results The number of human resources with DX skills (DX promotion personnel): 3,237. Initiatives Achieved the target for basic programs aimed at all employees by the end of March 2023, two years ahead of the schedule set in the medium-term management plan. Launched a new program for those interested in further enhancing their skills.
	Enhancing educational content. Deploying initiatives to provide learning opportunities (Expansion of e-learning, provision of a wide range of learning content through online seminars).		Provided e-learning “Udemy Business” to all full-time employees to promote autonomous learning. Provided several kinds of educational content to help them acquire various other knowledge and skills and form their own career autonomously.
Promoting Work-Life Balance	Optimizing total working hours through initiatives such as improving the rate of taking paid vacations. Achieving a paid vacation utilization rate of 70% or higher to establish a work-life balance.	We promote a work style that emphasizes a healthy balance which will enhance employee satisfaction and improve productivity.	Results Paid leave utilization rate: 70.9% Initiatives Created an environment where each employee can recognize their own optimal work-life balance and work the way they like, by regularly sharing such information as the current paid leave utilization rate and good examples, in addition to offering planned leave.
Initiatives on Human Rights Due Diligence	Implementing training programs on promoting human rights awareness in the workplace.	Through human rights education, we recognize the fundamental social responsibility in our business activities and conduct our operations with consideration for human rights.	Formulated the Human Rights Basic Policy and regulations on human rights and established the Human Rights Promotion Committee. Started human rights due diligence, identified and assessed human rights risks within our Group, and developed measures to prevent and alleviate adverse impacts. Conducted internal training programs aimed at the top management, among others, to enhance human rights literacy among all employees, including directors and other officers.

Materiality

Strengthening Governance

Initiatives	Details and Key Performance Indicators (targeting March 2025))	Social value/corporate value Targets	Results and Initiatives in FY2023
Establishing the Operation of Risk Appetite Framework	Defining and establishing Risk Capacity (RC) and Risk Appetite Framework (RAF) operation flow and regulations. Calculating capital adequacy considering credit, market, and operational risks, and allocating to growth areas. Formulating strategies and plans for each sub-portfolio and progress management.	Through further improvement of the governance framework, we aim to achieve sustainable growth and long-term improvement in corporate value.	Started full-fledged operation of allocation Risk Capacity/Risk Appetite Framework operation and implemented a disciplined inorganic strategy based on quantitative risk measurement. Introduced a new tool to refine the method of measuring real estate investment and other risks. Held seminars, among others, within our Group to develop risk literacy.
Initiatives for Improving ESG Evaluation	Establishing a governance framework aligned with prime market standards and high-quality communication with rating agencies.		Obtained “A” in the MSCI ESG Ratings. Obtained “B” in our first-ever submission of the CDP Climate Change 2023 Questionnaire.
Establishing and Improving Compliance System	Developing a new compliance code of conduct ("New OriCode"). Implementing measures to promote internal adoption and raising awareness among employees of the "New OriCode" through education and training programs. Creating and disseminating OriCode applicable to employees of overseas group companies.		Conducted e-learning and training programs tailored to different levels of all employees at our Group to promote our New OriCode. Shared information and created and distributed awareness posters on the New OriCode to deepen employee understanding.

Sustainability Report

This section contains information on our basic approach to sustainability, our initiatives, and our future direction.

Sustainability Report 2022

Integrated Report has been issued since FY2023.

Integrated Report

TOP PAGE

Sustainability