Subaru Corporation

No leading practices were identified for this company.

No leading practices were identified for this company.

No leading practices were identified for this company.

No leading practices were identified for this company.

Subaru has not set sufficient intermediate targets. Setting regularly spaced intermediate targets will help the company incentivise near-term actions on its longer-term decarbonisation goals. Additionally, the company’s downstream scope 3 emissions target could not be assessed as no data was found on the company’s base and reporting year emissions intensity. Subaru’s target to reduce scope 1 and 2 emissions by 100% by 2050 from its 2016 baseline could not be assessed as it is unclear if it plans to use offsets. Reducing emissions related to its operations and products should remain the company’s priority. Furthermore, the company should disclose the proportion of each target that will be met through direct action, rather than including offsets.

Subaru has a comprehensive low-carbon transition plan supported by financial content and informed by climate scenario analysis that has considered the implications of a 1.5°C scenario. Yet, it does not incentivise low-carbon performance through executive compensation. The company can improve the likelihood of a successful low-carbon transition by aligning its executive incentives with its decarbonisation commitments.

Subaru does not disclose its current or planned capital expenditure (CapEx) on low-carbon technologies. Subaru dedicated less than 3% of its R&D to low-carbon technologies in 2022 but did not disclose this share for 2023. Moreover, less than 1% of Subaru’s sales in 2023 consisted of low-carbon vehicles. Reducing emissions aligned with a 1.5°C pathway requires companies to rapidly increase their sales of low-carbon vehicles and reduce ICE vehicle sales. Subaru needs to step up its ambition to meet its 1.5°C pathway, which requires 67% of automobile sales in 2030 to consist of low-carbon vehicles.

The credibility of Subaru’s statements on climate change is undermined by its continued membership and board roles in trade associations that have opposed climate policy. Subaru is on the board of the Japan Automobile Manufacturers Association, which engages in strategic, negative advocacy in multiple regions against stringent greenhouse gas (GHG) standards for vehicles, zero-emission vehicles (ZEV) and ICE phase-out targets. The company should establish a clear process to review and withdraw from associations that oppose climate policy.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders.  No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

No public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s actions to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks.  The company discloses the actions it takes to provide upskilling, training and education opportunities for workers and affected stakeholders. For instance, it has several upskilling, training and education programmes and rewards employees for their development. However, no relevant disclosure was found of the company embedding equality of opportunity for women and vulnerable groups in these actions. Furthermore, no evidence was found of the company having a process for identifying skills gaps for workers and affected stakeholders or a public commitment to help workers displaced by the transition to reskill or upskill.  

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders.  No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers. 

The company commits to respecting human rights and the ILO fundamental rights at work, and it expects its business relationships to respect the ILO fundamental rights at work. Furthermore, the company discloses a human rights due diligence process that includes the identification and assessment of salient human rights risks. The company takes action to mitigate these risks in its own operations and its supply chain, but it does not engage with affected stakeholders. Additionally, the company has a grievance mechanism available to workers but not to external stakeholders. 

The company commits to respecting the health and safety of its workers but does not expect the same commitment from its business relationships. Further, it has not set a time-bound target for paying all workers a living wage and does not limit required working hours to 48 hours per week. It also does not disclose the proportion of its direct workforce covered by collective bargaining agreements. The company discloses some indicators of workforce diversity, including the gender of its workforce by employee category. However, no relevant disclosure was found of additional indicators of workforce diversity. The company has a commitment towards gender equality and women’s empowerment. 

The company commits to protecting personal data but does not disclose a privacy statement regarding the use of personal data. Additionally, it has a global tax strategy but lacks board accountability for the strategy. The company does not have a policy prohibiting bribery and corruption, but it includes anti-bribery and anti-corruption clauses in its contracts with business relationships. However, it does not describe the process to identify its bribery and corruption risks and impacts in its own operations. The company does not have a lobbying and political engagement policy and does not specify that it does not make political contributions.