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In our Sustainability Vision 2050^*1 plan, Sekisui House has set the goal, as a challenge for 2050, of maximizing ecosystem networks through business operations. We aim not only to achieve no net loss (to maintain the value of ecosystems) but also become nature positive (to enhance the value of ecosystems through our business operations). Based on this commitment, we remain focused on the Gohon no Ki Project, a landscaping and greening project that fully considers the ecosystem, as well as FairWood sustainable wood procurement.
　　In particular, achieving zero deforestation in wood procurement is recognized as a pressing global issue. The goal of zero deforestation by 2030 was adopted in the 2014 New York Declaration on Forests, and at COP26 in 2021, over 140 nations, including Japan, agreed to this goal. The Sekisui House Group supports zero deforestation, which aligns with its FairWood procurement approach. As a Group-wide challenge for 2050 in Sustainability Vision 2050, it has declared its commitment to Deforestation and Conversion Free (DCF) practices. In the future, we also aim to achieve DCF throughout our primary and secondary suppliers.

The Gohon no Ki Project, an eco-friendly landscaping and greening project^*2

Sekisui House is Japan’s largest landscaping company, planting innumerable trees nationwide. To fulfill our responsibility as a large-scale house builder, since 2001 we have been implementing the Gohon no Ki (“five trees”) Project, an ecosystem-conscious landscaping and greening project, to conserve biodiversity through our housing business.
　　The Gohon no Ki Project is based on the approach that “three trees are for birds, two trees are for butterflies, and all are local native tree species.” The project proposes the use of native tree species that are beneficial to birds and butterflies in gardens. In addition to biodiversity conservation, we are making proposals that encompass the benefits to residents of garden visits by fauna and the other effects of garden trees. We seek to maintain and revive the ecosystem network (nature positive) by increasing the amount of richly green space in urban areas and by leveraging residential gardens, created under the Gohon no Ki Project, to support the habitat and activities of the fauna. Ecosystem networks enrich biodiversity at the regional and national levels, creating places where both wildlife and residents can simultaneously enjoy the richness of nature.
　　The “Five Trees Project” marked its 25th anniversary on March 1, 2026, since its launch in 2001. Thanks to the continued support and cooperation of our customers nationwide, the initiative has been steadily advanced, resulting in approximately 745,000 trees planted during fiscal year 2025 and a cumulative total of 21.43 million trees planted to date.

Evaluating effectiveness quantitatively using big data^*3 on biodiversity

In 2019, to comprehensively evaluate small green spaces scattered across Japan that could not previously be assessed, we worked with the Kubota Laboratory in the Faculty of Science of the University of the Ryukyus to start a joint verification analyzing the effectiveness of quantitative assessments of biodiversity conservation from a macro perspective. Using the big data on biodiversity from Think Nature Inc. in addition to cumulative data on the number, species, and location of trees planted by the Company, in 2021, this analysis made it possible to quantitatively express the effect of the Gohon no Ki Project on biodiversity in terms of the number of bird and butterfly species being attracted to residential areas. We also quantitatively evaluated the effectiveness of restoring biodiversity in Japan’s three largest metropolitan areas (Tokyo, Osaka, and Nagoya) using an integrated diversity index and conducted simulations to assess the effect of continuing the Gohon no Ki Project through 2070.^*4 The results showed that the Gohon no Ki Project contributes to the restoration of biodiversity, and that the potential benefits can be amplified by expanding the project in the future. We will widely disclose not only the results of these assessments, but also the expertise we have accumulated through our activities over the past 20 years, and will continue to work with many companies and individuals to promote nature positive initiatives.
　　In July 2023, to further accelerate the Company’s efforts in biodiversity conservation, we have entered into a collaborative agreement⁵ with Think Nature Inc. to promote biodiversity net gain and the standardization of its calculation methods.^*5 In June 2024, we launched a pilot version of the “Biodiversity Visualization Tool,”^*6 a jointly developed system designed to recommend trees that help maximize biodiversity conservation in customers’ gardens. We will accelerate our efforts aimed at our 2030 nature positive initiative while improving the quality of our ecosystem-friendly Gohon no Ki Project.

Quantitative evaluation of nature positive effects

Simulation of changes through 2070 in three metropolitan areas (Tokyo, Nagoya, and Osaka) where green space degradation is significant

Urban greening

Big data on biodiversity has revealed that urban areas with densely packed houses and a large number of people are just as important to biodiversity conservation as forests and satoyamas (the traditional Japanese rural landscape consisting of cultivated fields, forests, and human settlements that are interconnected and coexist harmoniously). It is important to create high quality green spaces in urban areas where the available area is scarce. The Company has created high-quality green spaces that significantly impact biodiversity conservation efforts through its Gohon no Ki Project, a project focused on planting native tree species. To accelerate initiatives throughout the industry, in September 2024, we conducted a joint evaluation with Asahi Kasei Homes Corp. and Daiwa House Industry Co., Ltd. on the effectiveness of biodiversity conservation in urban environments using native tree species. The evaluation was based on the analysis of Think Nature Inc., and the results showed that each greening concept successfully restored the multifaceted elements of biodiversity.

Greening and environmental conservation in condominiums for sale and urban development projects

Urban development under the concept of keinen bika— creating a landscape that grows more beautiful over time

Commitment regarding greenfield development

The Tama New Town Higashiyama subdivision (Hachioji, Tokyo) is an example of greenfield development. For this project, we are advancing environmental assessments with due consideration to the preservation and nurturing of the local ecosystem in line with the commitments of the Company’s Urban Development Charter, which states that “We will preserve existing woodlands and transplant trees that cannot be kept in place” and “Even small saplings will be saved and planted in various locations around town.
　　”Even when it comes to land within a greenfield, selections are made where residential land development is possible in line with Company standards, and we encourage urban development in accordance with the Gohon no Ki Project, taking the local ecosystem and environment into consideration.

Wood Procurement Policy and Wood Procurement Guidelines

Since establishing the ahead-of-the-curve Wood Procurement Guidelines in 2007, Sekisui House has promoted the procurement of FairWood, a sustainable source of wood. To better clarify our stance, we announced updates to our Wood Procurement Guidelines and creation of the Wood Procurement Policy on August 1, 2025.
　　The Wood Procurement Policy not only advances FairWood procurement as previously stated but also reaffirms our stance on working to achieve Deforestation and Conversion Free (DCF) by 2030 and tolerating absolutely no human rights violations. In line with this, the ten Wood Procurement Guidelines have been revised to use more specific terminology such as “Deforestation and Conversion Free (DCF)” and “respect for the free, prior and informed consent (FPIC)^*9 of indigenous peoples.”
　　FairWood is defined as wood that is not only legal, but also contributes to sustainability and local development. We have declared FairWood procurement as a priority in our Wood Procurement Guidelines, and we are working to improve our level of procurement while engaging with FoE Japan and other international environmental NGOs and industry organizations. For example, we are constantly working with environmental NGOs to obtain the latest information on high-risk areas and update our risk assessment methods.
　　One objective of FairWood procurement is to secure a stable supply of sustainable and renewable resources for the Company. Another objective is to achieve a positive impact through sustainable forestry management that goes beyond avoiding illegal logging by continually working on our supply chain as one of Japan’s leading wood consumers. This also aligns with our biodiversity conservation challenge goal of “maximizing ecosystem networks through our business.”

Wood procurement risk survey and risk assessment

Sekisui House implements a wood procurement survey of its major wood suppliers (roughly 60 companies) according to the following process. Since FY2025, we have explicitly stated in our Wood Procurement Policy and Wood Procurement Guidelines our goal of Deforestation and Conversion Free (hereinafter “DCF”) and have added a new KPI regarding the rate of DCF at our logging areas. The ratio of Rank S and Rank A^*11 wood has been gradually increasing from 47% before the guidelines were implemented in FY2006, reaching 97.1% in FY2025. The rate of DCF has reached 95.8%.
　　For existing suppliers whose evaluation results according to the Wood Procurement Policy reveal environmental risks, we conduct thorough due diligence^*12 by continuous monitoring of evaluation standards and the achievement of those standards.In the event that a serious risk is discovered in the due diligence process, we work with the related divisions to determine the proper remedial action and take measures that could include cutting back on transactions with the supplier, depending on the score in the supplier assessment. No suppliers were deemed high-risk in FY2025.

Annual Due Diligence Wood Procurement Risk Survey Process

Practicing due diligence in procurement

To us, due diligence is the process of securing sustainable timber that supports the future of our business, and we implement sustainable wood procurement through strict due diligence(hereinafter referred to as “DD”) practices. Many companies conduct DD only for low-risk timber from primary suppliers. In contrast, we also target suppliers at the secondary level and further upstream, visiting logging areas to investigate and confirm the status of operations when risks that cannot be simply eliminated are identified. This is because we believe it is important to share the tracking process with suppliers and strive for ongoing improvement in order to meet growing international calls for Deforestation and Conversion Free (DCF).

Conducting onsite due diligence overseas

Conducting onsite DD in high-risk areas of wood procurement is both effective in achieving Deforestation and Conversion Free (DCF) and zero human rights violations in our Wood Procurement Policy and for strengthening engagement between various stakeholders such as suppliers and environmental NGOs. In FY2025, we conducted due diligence of raw materials for interior components in Thailand and Vietnam, following due diligence conducted in Indonesia in FY2024. During this visit to logging sites and manufacturing plants for raw materials, we confirmed that our procurement practices do not contribute to deforestation and land conversion. We additionally held interviews regarding human rights violations in the supply chain and confirmed that no such violations were taking place.

Acquiring forest certifications (CoC certification)

The Company uses forest certification systems as one method to advance FairWood procurement and the Production and Procurement Division has acquired FSC^*18, PEFC^*19, and SGEC^*20 CoC certifications.

Supply chain engagement

To ensure broad understanding among internal and external stakeholders of the “Wood Procurement Policy” and the “TWood Procurement Guidelines,” which were revised in fiscal 2025, we held briefing sessions in August 2025. A total of 67 supplier companies, with whom we are working together toward achieving our goals, participated in these sessions.
　　We invited a lecturer from the international environmental NGO Friends of the Earth Japan (FoE Japan) to give a keynote speech sharing the latest information on wood procurement. Two of our suppliers shared examples and all parties involved gained a deeper knowledge of the Company’s policies and guidelines.
　　As we work together with our suppliers to achieve the goals of our FairWood procurement policy, we often face challenges that are difficult to resolve through supply chain management methods alone, including those related to due diligence. In response to such challenges, we take a cross-organizational approach with our suppliers, engaging in technical discussions—such as exploring the possibility of switching to materials that meet due diligence standards—as part of our efforts to achieve our targets.

Corporate green space that can contribute to biodiversity and obtaining Nationally Certified Sustainably Managed Natural Sites certification

Domestic wood initiatives at Sekisui House

Looking at the forest industry in Japan, while many forests are entering a period of full-scale use, they are not being fully utilized for a number of reasons, and are not being replanted for the next generation.
　　To revitalize the domestic forest industry, we believe it is necessary to achieve the goals of both increasing demand to promote the renewal of forests for the next generation and advancing branding to create added value. Therefore, we have started using domestic timber, mainly for the structural materials in our SHAWOOD wooden-frame houses.
　　We do not simply use domestic timber, but also develop it as regional brands. By adopting materials from the regions where our customers live, we are contributing to local production for local consumption and the revitalization of regional economies.
　　Currently, we are developing cedar, cypress, and larch products, with over 8,000 buildings having been built with these materials. These products have grown to the point where they are an essential element of SHAWOOD. In addition, the Company utilizes forest certification to support the promotion and expansion of certified forest products in Japan. In FY2024, we also joined the Forest Certification Promotion Council.

Participating in initiatives

We have been an early participant in the global movement for biodiversity conservation. At the 9th Conference of the Parties to the Convention on Biological Diversity (COP9) in 2008, we were one of the nine major Japanese companies to sign the Leadership Declaration of the Business and Biodiversity Initiative.
　　As a founding member of this initiative, we agreed to the three objectives of the Convention on Biological Diversity (conservation of biodiversity, sustainable use of biodiversity components, and fair and equitable distribution of the benefits of genetic resources), and we continue to promote biodiversity conservation^*24 under this policy in our business operations. We have also endorsed the goals of the Taskforce on Nature-related Financial Disclosures (TNFD), which was launched in June 2021. We then joined the TNFD Forum in February 2022 and in January 2024 were recognized as a TNFD Early Adopter. In addition, we are part of the 30by30 Alliance, which was launched with the aim of achieving the global 30by30 target^*25 adopted at the 15th Conference of the Parties to the Convention on Biological Diversity (COP15), and we are proactively cooperating with Nationally Certified Sustainably Managed Natural Sites^*26 with the aim of achieving OECM^*27 registration.
　　These initiatives are led and promoted by the Environmental Subcommittee, in cooperation with each department as well as domestic and overseas Group companies, based on the ESG management promotion structure.^*28 We also ensure that all employees understand and are familiar with these initiatives through progress reports, feedback on issues, and proposals for improvement.