Sustainability Report: How Hitachi is Powering to Net Zero

Hitachi Group has revealed a host of impressive carbon-reduction wins in its 2024 Sustainability Report.

The company, which operates a worldwide business from its Japanese headquarters, operates across three core divisions – Digital Systems & Services, Green Energy & Mobility and Connective Industries.

It has 270,000 employees, working in:

• Information & Telecommunication Systems
• Social Infrastructure & Industrial Systems
• Electronic Systems & Equipment
• Automotives Systems
• Smart Life & Ecofriendly Systems
• Rail
• Energy
• Digital Transformation
• Green Transformation
• Renewables.

Lorena Dellagiovanna, SVP & Executive Office, Chief Sustainability Officer, CHRO, GM of Human Capital Group and CDEIO, says: “Looking back on fiscal 2023, we successfully met most of our sustainability goals and KPIs.

“We will continue to accelerate our evolution and enhance our practices to achieve more advanced sustainability management.”

Highlights from the Hitachi report

Hitachi Group’s target is to achieve business carbon neutrality by 2030 and value chain carbon neutrality by 2050.

Lorena says: “Some of the notable progress we made in the area of environment relates to decarbonisation and circular economy.”

She says “good progress” is being made with internal initiatives, including the 74% reduction in CO2 emissions at business sites.

Lorena adds: “Significant contributions came from Hitachi Energy, which specialises in electric power transmission and distribution.

“The total grid-connected capacity of Hitachi Energy’s HVDC technology now stands at 150 GW, equalling Japan's peak demand. This milestone reflects the increasing global shift toward clean energy.”

Hitachi Energy has hired over 8,000 new employees globally and has invested US$3bn in manufacturing, engineering and R&D since 2020.

Lorena says: “These efforts underscore our commitment to supporting our customers as long-term strategic partners and highlight the impact of our sustainability initiatives.”

She goes on to explain how Hitachi is transforming its business model, “shifting toward using fewer raw materials, water and other resources more efficiently and sustainably.

“As a company with a long history in manufacturing, we recognise the need to approach production with a new mindset.”

Hitachi is moving from a "sell-only" business to a "service-type" business model, where it focuses on the use of products rather than just their ownership.

Lorena says: “This shift not only aligns with our sustainability goals but also ensures we remain relevant and competitive in the evolving market.”

Balancing gen AI and sustainability management

In common with most businesses, AI is at the forefront of Hitachi’s thoughts and plans, particularly in terms of sustainability, as Lorena explains.

“In 2023, we witnessed an epoch-making technology, generative AI, take the world by storm, impacting industries and society as a whole.

“Generative AI can significantly improve work efficiency, allowing people to focus on more value-added and creative tasks.

“However, as its use expands, the demand for data centres will rise, leading to increased power consumption and CO2 emissions.”

She asks how gen AI can be viewed from the perspective of “balancing planetary boundaries and wellbeing”.

Lorena adds: “At Hitachi, we aim to analyse both the positive and negative impacts of generative AI from multiple perspectives, including environmental impacts and ethical implications.

“Our goal is to derive optimal solutions that enhance society’s wellbeing while staying within planetary boundaries.”

A message from the CEO

Keiji Kojima, President & CEO, Hitachi Global, also highlights the challenges and opportunities of gen AI.

He says: “With the advent of generative AI, the demand for digitalisation is rapidly increasing. Meanwhile, the global economy is pursuing the path to stable growth despite its vulnerabilities, due to complex geopolitical situations, and shortages of resources, energy and labour.

“We believe it is crucial to identify new growth opportunities that are unlocked by the impact of generative AI on society and the social issues that emerge from shifts such as climate change and demographics, and further advance our efforts toward realising a sustainable society.”

He says Hitachi will strengthen its problem-solving capabilities using Lumada’s customer co-creation framework.

Keiji also talks about the challenges of operating a global company at a time when so many sustainability frameworks are in flux.

He says: “Hitachi is currently working to gain an understanding of and prepare to act on the sustainability reporting standards prescribed by the EU’s Corporate Sustainability Reporting Directive (CSRD), the International Sustainability Standards Board (ISSB) and others.

“We will continue to review our material topics and the process of identifying them on an ongoing basis, informed by the changing demands of society and the needs of our stakeholders.”

CSO’s message to stakeholders

Lorena’s introduction to the sustainability report ends with an upbeat message about the company’s commitment to carbon reduction.

She says: “Hitachi has been dedicated to reforming our business portfolio with a focus on the Social Innovation Business under the slogan of Hitachi Social Innovation is POWERING GOOD.

“We are committed to contributing to a sustainable society and to people's happiness through various social innovation initiatives based on this concept.

“This approach has enabled Hitachi to grow sustainably, which I believe is reflected in our stock price, market value and reputation for sustainability management, including our performance on ESG evaluations.”

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