On June 27, 2024, Daikin Industries held a general shareholders meeting. Tansa obtained the audio recording.

Several shareholders have asked questions about PFOA contamination around the Yodogawa Plant in Settsu City, Osaka Prefecture.

Neither President Masanori Togawa nor Yoshiyuki Hiraga, the executive in charge, provided a proper explanation of the pollution countermeasures or business risks. However, they explained that there is demand for PFAS in the manufacture of semiconductors and automobiles, and stated that they would continue to focus on the fluorine business.

From left, Daikin Industries President Masanori Togawa, former Chairman Noriyuki Inoue, and Managing Executive Officer Yoshiyuki Hiraga (photo from Daikin Industries official website)

Unknown effectiveness of “pollution  countermeasures”

The 121st Annual General Meeting of Shareholders was held in the Shion Room of Hotel Hankyu International in Osaka City.

President Masanori Togawa moderated the meeting. Before presenting the proposal to shareholders, he addressed the company’s current business status. During the question-and-answer session, shareholders posed a number of questions about PFAS contamination.

Tansa has been reporting on PFOA contamination by Daikin since November 2021. We have acquired audio from shareholder meetings before, but this was the first time a question about PFOA contamination was raised during the shareholder meeting.

One shareholder asked:

“PFAS pollution at the Yodogawa Plant is now being covered in the media. We would appreciate it if you could present us with the measures and countermeasures that will reassure us shareholders.”

The person who answered the question was Yoshiyuki Hiraga, Managing Executive Officer (Chemical Business, Chemical Environment and Safety), who Tansa had previously interviewed in person.

“Thank you for your question. My name is Hiraga and I am in charge of chemistry. Regarding the issue of PFAS around the Yodogawa Plant, we installed new wastewater treatment facilities in 2009 to purify the water, and we are actively trying to pump and purify more groundwater.”

Indeed, at the Yodogawa Plant, high-concentration PFOA water that has accumulated underground on the site is pumped up, treated, and discharged as a sewer.

However, Daikin has not disclosed the PFOA concentration at the time of sewage discharge. Despite requests from local residents and Osaka Prefecture, the company has refused, and this remains the case today. It is unclear how effective this has been. On the contrary, a 2020 survey by the Ministry of the Environment found that groundwater sampled near the Yodogawa Plant had the highest PFOA concentration in the country.

Hiraga continues.

“Furthermore, while taking into consideration the opinions of experts, we are constructing the impermeable wall and proceeding with the purification process.”

The Yodogawa Plant has decided to install an impermeable wall to prevent the high concentration of PFOA in the underground water from spreading beyond the site. Nonetheless, only a part of the barrier has been installed so far. Daikin has been aware of the dangers of PFOA since the 2000s, but has yet to complete the impermeable wall.

Daikin is only purifying its own premises and ignoring the contamination outside of its premises. It has not responded to requests for compensation or purification from local residents.

No mention of residents’ exposure to high levels of PFOA

Partway through his answer, Hiraga shifted the topic.

“On the other hand, PFAS refers to about 10,000 different types of fluorochemical compounds. Of these, around three types and their related compounds are capable of accumulating in the body, while the remainder are considered inactive.”

Hiraga mentioned “three types”: PFOA, PFOS, and PFHxS, all of which are banned to produce in Japan. He appears to be suggesting that anything other than these three types has no problem. However, the chemical causing pollution around the Yodogawa Plant is PFOA.

Hiraga further stated:

“In a wide range of cutting-edge fields, including semiconductors, automobiles, information and communications, and medical care, the high performance of fluorochemicals is best suited to customer needs. They are often difficult to replace with other materials. As a responsible producer, we consider the life cycle of our products, minimize our environmental effect, and strive to continue expanding our fluorine business.”

Despite causing this much pollution, the company stated that it “strives to continue expanding fluorine business” while “minimizing environmental effect.”

It is strange that they only mention the environmental impact. High concentrations of PFOA have been detected in the blood of residents living near the plant. PFOA is a substance that has life-threatening health effects, including carcinogenicity and pregnancy-related hypertension. Every year, reports of causal relationships with various diseases are being made around the world, and regulations are being implemented in various countries.

PFOA contamination is no longer an environmental issue but a human rights issue.

After Hiraga’s explanation, President Togawa said, “I would like to add a few points.” He asked for approval of the pollution countermeasures.

“We certainly take seriously the concerns of local residents and those living around the Yodogawa Plant. We will take all possible measures in consultation with related organizations and the governor of Osaka Prefecture, so we ask for your understanding.”

“Safe PFAS”?

Questions about PFAS were also raised by other shareholders.

“As you explained earlier, out of the 10,000 types, three types accumulate in the human body. While it is very difficult to replace them, are these three types still being used?”

Hiraga responded.

“My previous explanation may have been misleading, but the three types are no longer in use by us or our competitors. I hope that this will reassure you.”

These three types are already prohibited by law, thus they sure cannot be used. They are also not safe. They are highly cumulative and persistent, and even past production still contributes to wide contamination in Settsu City, Osaka Prefecture, and Higashiyodogawa Ward, Osaka City, near the Yodogawa Plant.

Hiraga continues.

“In the future, with regard to alternative substances, for example in semiconductor manufacturing equipment, they are used in ‘harsh conditions.’ There are other PFAS than the three types, safe PFAS, if you will. Such substances are already being used.”

It is unclear what “harsh circumstances” Hiraga means, but another shareholder raised his hand in response to this answer.

“As you said earlier, I was wondering what exactly “safe PFAS” means.”

Hiraga’s response did not answer the question asked by the shareholder: “What is ‘safe PFAS’?”

“PFAS, as I mentioned earlier, is a general term for over 10,000 different types of diverse organic fluorine compounds. Each PFAS has unique characteristics and physical qualities, but the ones that have been identified as having the potential to accumulate in the body are the ones I stated earlier: PFOA, PFOS, PFHxS, and related compounds. Other compounds are not yet identified as having the capacity to accumulate in the body. Furthermore, the OECD classifies fluoropolymers and fluororubbers as compounds of low concern, which we believe are safe. That concludes my explanation. Thank you.”

As soon as Hiraga finished speaking, President Togawa spoke without a moment’s hesitation.

“Well then, I would like to move on to the vote on the proposal.”

Chairman Inoue’s first post was at the Yodogawa Plant

At the general shareholders’ meeting, the agenda also included the presentation of a “special achievement bonus” of 4.3 billion yen to Noriyuki Inoue, who is retiring as chairman.

Inoue served as the head of Daikin for 30 years, and his first post after joining the company was at the Yodogawa Plant, where he served as deputy general manager during the period when PFOA was being manufactured and used.

Even after the dangers of PFOA became clear to the world, Inoue continued to green light the fluorine business, including PFOA production. In a magazine interview, he even said, “In the fluorochemical business, Daikin will bust if we aren’t number one or number two in the world.”

However, shareholders applauded in approval of the 4.3 billion yen donation to Inoue, and the proposal was passed.

At the end of the meeting, Inoue took the stage.

In his approximately four-minute speech, he expressed his gratitude to shareholders, employees, and customers and said the following.

“We are truly fortunate to be able to celebrate our 100th anniversary this year with the best performance ever.”

(Originally published in Japanese on June 27, 2024. Translation by Mana Shibata.)

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