Yoshimitsu Kobayashi
Representative Director, Member of the Board, President,
Mitsubishi Chemical Holdings Corporation
In the year ended March 31, 2009 (fiscal 2008), we continued to experience extremely severe and unstable economic conditions. This included a global recession, substantial foreign currency exchange rate volatility, and violent fluctuations in raw material and fuel prices triggered largely by the financial crisis in the U.S.
Under these circumstances, the Mitsubishi Chemical Holdings Group (MCHC Group) has seen an unprecedented deterioration in its revenues and earnings due mainly to the worldwide economic downturn that has persisted since last fall.
In our current mid-term management plan, APTSIS 10, formulated in May 2008, our basic strategies aim at "growing, innovating, and leaping ahead" over the period from April 1, 2008 to March 31, 2011 (fiscal 2008 - fiscal 2010). On this basis, we have been working diligently to enhance existing growth businesses through the shift to high value-added activities, while implementing efficient product and business lifecycle management. At the same time, we have been nurturing seven next-generation growth businesses and endeavoring to leap ahead through mergers and acquisitions.
Buffeted by harsh economic conditions, however, we revised these basic strategies in June 2009 focusing on responding rapidly to business contraction by accelerating the pace of structural reform, innovation, and leaping forward.
Based on the aforementioned policy, and recognizing the current severe business environment as not only a crisis to be overcome, but also an opportunity for innovative change, we are stepping up efforts to restructure our business portfolio, rationalize capital expenditure as well as investment and loan activity and implement various measures with a greater sense of urgency.
At the same time, we are looking to realize our aspiration of sustainable growth through environment-oriented management.even in the new world that is emerging amid economic recovery.by accelerating the process of business selection and concentration, assessing our operations on the core criteria of whether they contribute to the sustainability, health, and comfort of society.
As part of these efforts, we are prioritizing the allocation of R&D resources to white LEDs and lithium-ion battery materials for hybrid electric vehicles, aiming to achieve rapid commercialization of these technologies, which have great potential to contribute to the reduction of greenhouse gases.
Our aspiration as a group is to become a leading global company, undertaking "Good Chemistry" in the context of sustainability, health, and comfort as noted above. Accordingly, in April 2008, we adopted a new Group motto, abbreviated as the acronym APTSIS, as a means of creating a shared sense of endeavor among employees and to reflect our unwavering commitment to our aspiration.
Since then, I have been taking every opportunity to promote APTSIS throughout the Group and explain the principles it represents.
This has led to valuable feedback from employees on a daily basis, and as we work toward realizing our corporate aspiration, it is gratifying to see the clear progress we are making in terms of awareness, corporate values, and actual business outcomes.
I view the promotion of APTSIS as an important ongoing task, and through a variety of means will continue to actively communicate APTSIS throughout the Group.
APTSIS calls for us to reinforce "transparency, accountability, and compliance" as well as "safety in manufacturing and trust in quality."
The MCHC Group is also a signatory to the Global Compact, a series of 10 principles espoused by the United Nations with respect to human rights, labor rights, and the environment.
All of these issues are critical to our continued existence as part of society, and serve as our management foundation.
Recognizing this, the MCHC Group redoubled its efforts to ensure safety and compliance throughout fiscal 2008 with the aim of restoring the trust it had lost as a result of such incidents as the fire at Mitsubishi Chemical's Kashima Plant, Mitsubishi Plastics' violations of the Antimonopoly Law, and the hepatitis C virus (HCV) lawsuit against Mitsubishi Tanabe Pharma.
We continue to believe that the foundation for our business activities is the trust we earn from society, and through ongoing dialogue with our stakeholders we are striving to create the highest possible level of social trust in our Group.
The world of the 21st century faces multiple challenges.in the environment, in energy and other natural resources, in water, food and health.and we can no longer engage in the simple pursuit of a "better quality of life."
Therefore, the MCHC Group has begun a global research project with the aim of contributing to the creation of a sustainable society in which citizens everywhere can enjoy a more secure, plentiful, and stable future.
As part of this project, we established The KAITEKI Institute (KAITEKI meaning "comfort" in Japanese) in April 2009. This institute is developing a number of research themes to address pressing global issues of the 21st century, based on the key concepts of sol (sun), aqua (water), and vita (life).
The MCHC Group philosophy, "Good Chemistry for Tomorrow - creating better relationships among people, society, and our planet," calls for the creation of a better tomorrow through our products and technologies. We are convinced that the realization of this philosophy is our core corporate social responsibility.
Inspired by this philosophy, the MCHC Group will in future deepen its dialogue with stakeholders including customers, shareholders, business partners, employees, and local communities and contribute to the creation of a vibrant and affluent society filled with KAITEKI.
August 2009
Yoshimitsu Kobayashi
Representative Director, Member of the Board, President
Mitsubishi Chemical Holdings Corporation
