Basic Management Policy for the Teijin Group

We formulated a new Basic Management Policy encompassing urgent short-term measures and structural reforms, as well as medium- and long-term business strategies.
For the short term, we will expedite our structural reforms and strive to restore profitability quickly and to secure a cash flow and financial robustness, even against the background of the extremely harsh operating environment.
Over the medium to long term, through technology-driven innovation we will strive to ensure sustainable growth and attain global excellence by providing attractive solutions in two key areas. The first of these, green chemistry, encompasses advanced and compound materials, biomaterials and recycling systems, which support efforts to, among others, manufacture lighter, safer products and recycle energy. The second, heath care, focuses on major new drugs and next-generation pharmaceuticals, as well as innovative home healthcare services.
To speed up the achievement of these goals, we have identified a number of key challenges concerning structural and organizational reforms that we must address:

1. Secure a robust system for “self-dependent growth” based on technical development and innovations.
2. Expand solution businesses with the aim of securing an operating structure that is not susceptible to changes in economic circumstances and energy prices, and promote broadening the coverage of businesses in centers of economic growth around the world.
3. Reconsider the holding company system, which has been maintained since 2003, and the consultation system toward faster decision-making, and pursue the construction of the best management system befitting our competitive strategies, technical strategies, and human resources utilization.
4. Maintain and upgrade our basic policies of management: fairness, objectivity, transparency, and fast decision-making.

- Q2: Recent years have seen an extremely harsh operating environment. In light of this situation, do you plan to change the Teijin Group’s CSR management?

We will not change our basic concept and approaches for CSR activities. The Teijin Group is striving to attain global excellence. To this end, it is essential to establish the group’s corporate brand that will make its mark for Teijin on the basis of “excellent corporate governance” and “CSR to fulfill social responsibility for a business enterprise.” After that, we will work to make our businesses recognized globally and favored by customers. Although operating scale and management efficiency are indexes of the excellence of corporate performance, we don’t think them to be peremptory criteria.
Regarding specific measures for CSR, having carefully examined priorities in terms of importance and urgency, we will manage measures in a more strategic and efficient way. In the current harsh operating environment, in particular, considerable reduction of operations is ongoing at a number of our production bases, so special attention must be paid to safety, disaster prevention, product quality and the like. We think it necessary to manage our businesses while further raising awareness of compliance and various risks among all employees of the group companies.

- Q3: What do you think will be key issues from a CSR viewpoint in your management in the near future?

I would like to comment on some key points.

Promotion of Sustainable Environmental Initiatives

In 2007, we released a statement on the Teijin Group “Sustainable Environment Initiatives”, specifying our environmental policies with a focus on the three core elements: Environmental Preservation, Environmentally Friendly Design and Environmental Business. This year 2009 being a milestone for international negotiations on global warming, we will have further advances in our sustainable environment initiatives from this three-way perspective.
Regarding CO₂ emissions, we have set out the target of “reducing emissions by 20% or more compared to 1990 levels in Japan by 2020.” For the time being, we will not be engaged in emissions trading, but will endeavor to reduce absolute emissions by ourselves. As for fuels and raw materials, we will work on mitigating our oil dependence and promoting conversion to substitute items. In the context of environmentally friendly design, it is important to enhance the creation of new products and processes in compliance with the guidelines, and to formalize them in actual developmental activities. In the context of environmental businesses, we promote “green chemistry” businesses, which provide sophisticated solutions such as manufacture of lighter, safer products and recycling of energy by means of our advanced and compound materials, biomaterials and recycling systems.

Human Resources and Labor CSR

In recent years importance has increasingly been placed on promoting work-life balance and diversity. Measures related to employees’ work-life balance cannot be promoted without investigating and expanding their combination with systems that will lead to increased productivity. Meanwhile, in the context of diversity, the composition of Teijin Group employees is something that needs to be kept in mind. Currently, employees of foreign nationality account for 45%, or nearly half the total number of employees of all companies of our group. The percentage of female employees in managerial positions is low at 2.9%, and we are planning to raise the level in a schematized way. Bearing in mind the outlook for increasing trends toward knowledge industry society and a declining birth rate, I believe that for the sustainable growth of the Teijin Group it is of great importance to promote both employees’ work-life balance and diversity.

CSR concerning Purchasing and Procurement

The Teijin Group is conducting organic activities in the society supply chain, for which we serve as an initiator. In this position, we recognize ourselves as being obliged to promote CSR activities involving our partners in response to social demands. Accordingly, we are working to draw up CSR procurement guidelines that we and our suppliers have to fulfil with regard to the purchasing and procurement of raw materials and other items for our operations, and promote CSR procurement. Within the industrial sector, efforts are being made to establish CSR standards, and amid this situation, the Teijin Group would like to serve as an initiator of social reformation.

CSR Innovations

It will become increasingly important to develop new business models that are socially contributory or environmentally conscious with the involvement of stakeholders. As a good example of such CSR innovations, the Teijin Group has succeeded in operating the ECO CIRCLE recycling system for polyester products. We will make active efforts to develop further new business models that follow such successful cases.

We look forward to the support and understanding of our stakeholders.