Outside Directors Roundtable Talk

Support for Structural Reforms Through Development of Both the Organization and Personnel

Manabe(Y): In the next medium-term management plan, we will more clearly pursue a strategy of selection and concentration that entails withdrawing from businesses with limited future potential, concentrating management resources on growth fields, and ensuring the realization of returns on past investments. Withdrawal from businesses requires major decisions with painful consequences—such as plant closures and the streamlining of workforces—as well as a plan that integrates business, research, and human resource strategies into a unified whole.

Sato: With respect to human resource development, I get the impression that the Group has created an environment where employees feel comfortable, find their work rewarding, and can continue working and growing for many years.

Manabe(M): Job satisfaction is a form of non-financial incentive compensation. Even amid worsening labor shortages, the Group can secure and strengthen its source of competitiveness by creating a corporate culture where employees feel a sense of job satisfaction and by remaining a corporate group of choice through the provision of ample opportunities for learning and taking on challenges and the granting of restricted stock to employees.

Kurihara: At the briefing of the Tokyo Research Laboratory, researchers of many different ages from various business sites were actively interacting, creating a very positive atmosphere. However, I felt that we still have some way to go in terms of diversity of experience and the systematic development of executive-level human resources.

Manabe (Y): The Group has its roots in two companies— the upstream-based Japan Gas Chemical and the downstream-based Mitsubishi Edogawa Chemical—and operates two business divisions: one manufacturing basic chemicals and the other manufacturing specialty chemicals. Without favoring either business field, the Group should develop management talent more effectively by stepping up cross-divisional job rotations that allow employees to gain experience in both upstream and downstream operations. In other words, there is a need to strengthen the process through which personnel accumulate a broad range of experience before joining the senior management team.

Utilization of Technology-Driven Uniqueness to Advance to the Next Growth Phase

Kurihara: Ahead of competitors, the Group is already cultivating the seeds of its next growth drivers through the construction of pilot plants and other initiatives for technologies and product lineups in the carbon-neutral field. I hope the Group remains focused on being in the vanguard so that it retains a technological edge when the time is right for commercialization.

Sato: While progress toward carbon neutrality may waver in the short term due to factors such as the international situation and energy prices, it is an irreversible medium- to long-term trend in society as a whole. I believe that focusing on this field, where the Group has technological advantages, is strategically sound.

Manabe (Y): I would like the Group to develop new pillars of growth in the carbon-neutrality field and other next-generation fields while further expanding existing growth drivers in fields such as AI semiconductors. I also look forward to seeing the next “home run hitter” emerge from among the Group’s diverse research initiatives.

Sato: I hope that, as an entity with global operations, the Group will achieve balanced growth by solidifying fundamentals—such as governance and data-driven business management—while aspiring to be an organization that views the rapid changes in the international landscape not as threats but as opportunities.

Kurihara: I believe that even with respect to basic chemicals, for which the business environment is challenging, there is still scope for innovative strategies, such as a shift in focus toward downstream operations. In the engineering plastics field, cost-saving ideas such as the rationalization of product specifications could also be considered. I hope that the MGC Group holds its ground as one of the chemical companies responsible for supplying materials that underpin other industries and helps maintain the presence of Japan’s chemical industry.

Manabe(M): The distinctive value of the Group lies in its ability to engage in a wide range of businesses, from upstream through to downstream, and to realize technology-driven differentiation. To ensure that its involvement in diverse businesses is not seen in a negative light, the Group must communicate to society in a broader, more accessible manner and with a focus on “Uniqueness & Presence” initiatives. While looking forward to the steady execution of fundamental structural reforms during this period of structural transition, I will continue to support the MGC Group in achieving its goals.