Respect for the Planet. Simply stated,
this is Toyota’s commitment to the environment.

We challenge ourselves to minimize environmental impacts at all stages of the vehicle life cycle: in research and development, manufacturing, logistics, sales, in use and at end-of-life. We look at our own operations as well as those of key business partners - suppliers and dealerships. And, we partner with our communities to support environmental programs and initiatives.

Our success comes from following the pillars and principles of the Toyota Way. The Toyota Way transcends language and nationality; it is applied in every Toyota region at every level. The Toyota Way provides a framework for constantly making improvements and steadily encouraging innovation and evolution.

“Continuous Improvement” is one of the pillars of the Toyota Way. It combines kaizen (change for the better) with standardized work, an evolutionary process that helps eliminate inefficiencies.

When a project finishes at Toyota, we methodically try to preserve what went well and create countermeasures for what did not. Lessons learned are incorporated into the standard process so that when we repeat it, we improve over the last time. We share these insights with our colleagues in a process we call yokoten.

When we practice yokoten, we share not only the methods and procedures, but also the reasons changes were made and what mistakes were made. By openly communicating and sharing this information horizontally across the organization, we foster a learning organization. Successful practices become the new standard.

Continuous Improvement is a repeating cycle. We strive, through kaizen, standardization and yokoten, to achieve an ideal situation. But there is always room for further improvement – that’s why we refer to successful practices instead of best practices. So once a kaizen is successfully implemented, we are ready to start the next round of kaizen and continue the cycle of improving.

Throughout this report, we highlight instances where yokoten is helping us improve our environmental performance across North America. We also feature a number of stories about our efforts to increase efficiency and eliminate waste, such as:

All of the steps we take to reduce our environmental footprint – through kaizen and yokoten, in waste and in other areas – are part of our long-term view of sustainable growth that shows respect for the planet at every turn.

Strategy

Toyota’s global commitment to the environment is stated in the company’s Global Vision, announced in 2011 and founded on a commitment to quality, constant innovation and respect for the planet. The Global Vision articulates the kind of company we strive to be - a company that shows consideration to the environment and investigates and promotes sustainable systems and solutions.

Toyota’s values are outlined in the Guiding Principles and Earth Charter. The Guiding Principles challenge the company to “be a good corporate citizen,” “dedicate ourselves to providing clean and safe products,” and “pursue growth in harmony with the global community.” Environmental responsibility is key to each of these.

The Earth Charter was developed in 1992 (and revised in 2000) to exemplify our comprehensive approach to managing environmental issues. The Earth Charter instructs us to strive for “growth in harmony with nature,” “zero emissions,” and “building close and cooperative relationships” with a wide range of stakeholders interested in preserving the environment.

Figure 1

To more effectively implement Toyota’s Global Vision, Guiding Principles and Earth Charter, the company has been moving toward a regional structure. Decentralizing certain functions allows each region to consider their own culture, geography and frames of reference. In North America, we are translating the global vision of Respect for the Planet into concrete action for our region.

We began by undertaking an environmental materiality assessment for North America. We evaluated the relative significance of the environmental topics facing us in the region. We also undertook to determine how important these topics are to our stakeholders. We are continuing to implement a formal stakeholder engagement process, to confirm the accuracy of our assessment. Our plan is to have ongoing periodic assessments to stay up to date with changing conditions and new developments.

Firgure 2

Based on our initial assessment, we identified four core areas of focus for operations in North America:

  • Carbon – vehicle fuel economy, vehicle fuels diversity, and energy and greenhouse gas emissions from operations
  • Water – water use, water discharge and impacts to water bodies
  • Materials – chemical, raw material and waste management
  • Biodiversity – habitat and species protection and enhancement

Within each of these areas, we consider impacts from our own activities, impacts at our Suppliers and Dealerships, and Outreach with external stakeholders. We are in the process of developing strategies for each of these areas of focus, including goals and targets encompassing the entire North American enterprise. We have already begun to align metrics and key performance indicators (KPIs) across all business functions.

In the meantime, we are still working toward meeting our annual environmental action plan targets in the areas of compliance, air (volatile organic compounds), energy, greenhouse gases, waste and water.

Figure 3

In this report, we describe environmental initiatives and performance in North America across our various business functions - research and development, manufacturing, logistics and sales. Information is organized by issue to allow for better readability and ease of navigation. In each chapter, we highlight those initiatives and partnerships that increase efficiency and eliminate waste. As one of our core areas of focus, we are proud of the good work already being done to reduce waste across the region.

Governance

In 2013, we formed the Toyota North American Environmental (TNAE) organization. TNAE reports to the North American Executive Committee and serves as the chief environmental body representing all Toyota entities in North America. TNAE, in cooperation with the Toyota North American Environmental Committee (which is comprised of members from the Executive Committee), establishes activities and provides one voice for appropriate responses to environmental issues in North America. TNAE’s primary responsibilities include setting policy and direction for the region, developing consolidated environmental action plan goals and targets, and developing the annual North American Environmental Report.

The TNAE organization includes an Advisory Board and Environmental Working Group. Both are comprised of environmental experts and representatives from four of Toyota’s North American companies:

  • Toyota Motor North America, Inc. (TMA)
  • Toyota Motor Engineering & Manufacturing North America, Inc. (TEMA)*
  • Toyota Motor Sales, U.S.A., Inc. (TMS)
  • Toyota Canada Inc. (TCI)

* TEMA includes both manufacturing and the Toyota Technical Center (TTC), Toyota’s North American research and development division.

This report contains information from these four companies. Representatives from these companies also participate in focus groups that concentrate on a particular environmental issue (such as water or biodiversity). These focus groups report to the Environmental Working Group and help develop and implement environmental action plan targets, develop strategies for the region, perform benchmarking and data gathering activities, and raise awareness.

Figure 4

Environmental Management Systems

Environmental management systems are an essential part of Toyota’s overall effort to minimize risks and achieve leading levels of environmental performance. Each location’s environmental management system (EMS) identifies significant environmental aspects and impacts of its operations, and has corresponding controls, goals and targets to manage and reduce these impacts over time.

Toyota’s EMS is part of a redundancy of systems put in place to protect the environment. We have used and enhanced these systems in North America for 25 years. Employees from various functions frequently speak at events to share their EMS knowledge with others.

Performance

In fiscal year 2013, all of Toyota’s North American manufacturing plants and logistics sites and several office complexes had an environmental management system certified to the ISO 14001 standard, the International Organization for Standardization’s core set of standards for designing and implementing an effective environmental management system. These 41 locations are listed in Figure 5. Our plant in Delta, British Columbia, was the first Toyota facility in North America to achieve this certification and has maintained it for 16 consecutive years.

We also encourage our suppliers to pursue third-party certification of their environmental management systems. Over 600 direct Tier 1 suppliers to our North American plants are certified to ISO 14001.

In addition, Toyota’s Tecate plant has received two Clean Industry (Industria Limpia) Certificates from Mexico’s Federal Agency for Environmental Protection (PROFEPA). PROFEPA awards Clean Industry Certificates as part of its voluntary audit program to companies committed to maintaining high standards of environmental protection, particularly in the areas of hazardous waste management, wastewater and water recycling, and environmental security. Each certificate is valid for two years.

Figure 5

TOYOTA’S EMS AT WORK AT OUR OLDEST PLANT

In 2012, we celebrated the 40th anniversary of our oldest plant in North America, TABC. Located in Long Beach, California, TABC is a supplier of components for the Tacoma truck manufactured at Toyota’s North American assembly plants in Texas and Baja California, Mexico. TABC provides sheet metal components, welded sub-assemblies, steering columns and painted axle housings.

TABC is a perfect example of how Toyota’s environmental management system (EMS) works. Our EMS provides a framework for compliance with all applicable regulatory requirements, but also paves a path for going above and beyond. TABC has held ISO 14001 certification since 1998, consistently achieving recertification every three years. This achievement means TABC is one of seven Toyota facilities in North America to have held the certification for 15 consecutive years.

TABC’s EMS stresses following a process and, when a problem arises, performing root cause analysis. By following Toyota’s well-developed EMS, team members are proactive, wherever possible identifying risk and making corrections to prevent a problem from occurring.

TABC, like many of the North American plants, is evolving. Organizational changes are part of this evolution, and new team members have recently taken on the responsibility of environmental activities. So the plant’s Environmental Department went back to basics, identifying and reconfirming high-risk areas, reviewing and revising policies and procedures, raising awareness on the shop floor every day, and checking for compliance and conformance.

TABC’s Facilities Engineering and Environmental group receives support from TABC’s Executive Management, Toyota’s North American manufacturing headquarters, and the Environmental Department at Toyota Motor Sales. This cooperation led to a major upgrade that significantly increases the reliability of the wastewater operations. In addition, secondary containment systems for the wastewater and paint processes were improved to prevent the risk of groundwater and stormwater contamination. The skills and capabilities of the team members at TABC were utilized to design, engineer and implement these projects using the latest technologies, with a kaizen mind and continuous improvement at the forefront of all activities, never afraid to think “outside the box.”

Over the years, TABC’s environmental team has developed a great partnership with Toyota’s North American manufacturing headquarters – Toyota Motor Engineering & Manufacturing, or TEMA, with TEMA providing additional implementation resources and expertise. TEMA, as a central repository of kaizens for all of North America’s manufacturing plants, facilitates the yokoten, or sharing, of ideas and lessons learned to improve the performance of the plants. As one of Toyota’s smaller plants, TABC’s environmental team is always willing to participate, share their ideas and learn from environmental initiatives at other North American plants.

“Working in one of the oldest Toyota plants in North America presents its own challenges with the age of some of the equipment,” said David Cooper, Environmental Assistant Manager at TABC. “Much of the technology Toyota uses today in the other plants doesn’t exist at TABC, making retrofits more fun! But with dedication from all departments at every level in the organization, we get it done.”

COMPLIANCE

Many of our activities in vehicle development, manufacturing and logistics are subject to local, state, provincial and federal laws that regulate air emissions, water discharges, stormwater management, greenhouse gas emissions, waste treatment and disposal, and chemical management. These regulations vary by facility based on the type of equipment we operate and the functions performed.

Toyota is one of a number of companies named as a potentially responsible party (PRP) at the Portland Harbor Superfund Site in Portland, Oregon, and at a waste management site in Calvert City, Kentucky. We continue to work on groundwater remediation at our Newark vehicle distribution center with the New Jersey Department of Environmental Protection and the New York/New Jersey Port Authority. At the Long Beach, California, vehicle distribution center, we are working with the Regional Water Quality Control Board to monitor and improve a groundwater quality issue related to a minor fuel release, which occurred during the replacement of underground storage tanks with new aboveground storage tanks.

TARGET AND PERFORMANCE

Target: Zero violations, zero complaints (achieved)

In fiscal year 2013, our North American manufacturing plants and logistics sites had zero regulatory violations. Our Canadian logistics sites achieved their 15th consecutive year with no dangerous goods violations.

In addition to regulatory violations, the manufacturing plants also track the number of complaints made by third parties. There were no complaints in fiscal year 2013.

Figure 6