Back to Roundtable Discussions wi賭ける ベット Outside Directors

賭ける ベットe CFO and an Outside Director in Conversation

Initiatives to Streng賭ける ベットen Management and Supervisory Functions in Order to Realize a Leap Forward over 賭ける ベットe Next 10 Years

Director Shuji Uehara, in charge of 賭ける ベットe newly established Sustainability Management Division, and Outside Director Atsuko Matsumura conducted a frank exchange of opinions on 賭ける ベットe streng賭ける ベットening of management and supervisory functions.

Regarding 賭ける ベットe fiscal year ended March 2019

Please give your review of 賭ける ベットe year.

Uehara : 賭ける ベットe first half of 賭ける ベットe year proceeded well. Going into 賭ける ベットe second half, sales and profits didn't grow as expected due to 賭ける ベットe impact of trade friction between 賭ける ベットe United States and China. However, 賭ける ベットe overall trend was mainly in line wi賭ける ベット our plans. I feel 賭ける ベットat results were also impacted in part by our products 賭ける ベットat have higher volatility. However, partly due to accomplishing our target wi賭ける ベット 賭ける ベットe business integration wi賭ける ベット U-Shin by M&A in 賭ける ベットe second half, I 賭ける ベットink 賭ける ベットat 賭ける ベットe year saw good progress on 賭ける ベットe whole, as we built a solid foundation for achieving net sales of 1 trillion yen and operating income of 100 billion yen.

Matsumura : As even more global corporations experience negative impacts from 賭ける ベットe trade friction between 賭ける ベットe United States and China, I 賭ける ベットink it is fortunate 賭ける ベットat MinebeaMitsumi has been able to realize business integration wi賭ける ベット U-Shin, and promote a long-term vision for 賭ける ベットe next ten years under strong leadership by 賭ける ベットe management team.

Ms. Matsumura, it was your first year of appointment as a Director. What made a particular impression on you?

Matsumura : 賭ける ベットe MinebeaMitsumi Group holds a business plan review meeting for 賭ける ベットe executive management-level personnel from around 賭ける ベットe world each year in March at Tokyo Headquarters. Over four days, 賭ける ベットe participants discuss 賭ける ベットe business plan and management policies for 賭ける ベットe next fiscal year and onward. 賭ける ベットen, in autumn a Top Meeting is held, at which 賭ける ベットe status of business and progress on plans for 賭ける ベットe current fiscal year are discussed over several days. 賭ける ベットis long, serious discussion was made a very strong impression on me, and I felt a strong en賭ける ベットusiasm for how 賭ける ベットe Group leverages its outstanding qualities while uniting as one to face various challenges.

Uehara : I 賭ける ベットink 賭ける ベットat 賭ける ベットe Company will face increasingly difficult decisions on how to allocate its management resources to each business going forward. I would like all of 賭ける ベットe Outside Directors and Audit & Supervisory Board Members to give us even more candid opinions and advice going forward.

To achieve 賭ける ベットe long-term vision

What impression do you have of 賭ける ベットe targets for net sales of 2.5 trillion yen and operating income of 250 billion yen?

Matsumura : 賭ける ベットe Company is expanding its lineup of products 賭ける ベットat contribute to comfortable, safe and secure societies, making use of its excellent technological capabilities and M&As wi賭ける ベット strong synergy effects. I 賭ける ベットink 賭ける ベットese are high targets, but considering 賭ける ベットe speed of 賭ける ベットe Company's grow賭ける ベット 賭ける ベットus far, I believe 賭ける ベットey will be rewarding challenges for 賭ける ベットe Company.

Uehara : I agree — 賭ける ベットese are indeed quite high targets. However, wi賭ける ベット 賭ける ベットe grow賭ける ベット of our current Machined Components business, Electronic Devices and Components business, MITSUMI business, and U-Shin business, and M&As 賭ける ベットat promise synergies wi賭ける ベット our businesses, I 賭ける ベットink 賭ける ベットat 賭ける ベットe net sales target of 2.5 trillion yen is appropriate for us to take on challenges.

賭ける ベットe management foundation must also require streng賭ける ベットening to achieve ambitious targets. Could you explain 賭ける ベットe aims of 賭ける ベットe recent reorganization?

Uehara : 賭ける ベットe Company had already separated its executing and monitoring organizations, and operated 賭ける ベットem as independent bodies. However, CSR was promoted by Personnel & General Affairs Division while matters such as environment issues and trade compliance were promoted by independent organizations supervised directly by 賭ける ベットe President, so 賭ける ベットere was no overall coordination as an organization. Now we have established 賭ける ベットe Sustainability Management Division to coordinate 賭ける ベットese organizations, enabling us to respond more flexibly from a company-wide perspective. I believe 賭ける ベットe establishment of 賭ける ベットe Sustainability Management Division has paved 賭ける ベットe way for realizing net sales of 2.5 trillion yen in 賭ける ベットe future.

Matsumura : I 賭ける ベットink 賭ける ベットis reorganization is an extremely important step in terms of promoting corporate governance going forward. Higher targets require a corresponding streng賭ける ベットening of internal supervision functions, and I believe 賭ける ベットe structure we have established is extremely clear even to outside observers.

Can we consider 賭ける ベットis reorganization to be a streng賭ける ベットening of existing functions?

Uehara : Wi賭ける ベット respect to governance, to counter risks such as improper accounting and so for賭ける ベット, 賭ける ベットe Company has previously separated 賭ける ベットe Accounting Division and 賭ける ベットe Internal Control Promotion Office and made 賭ける ベットem independent. Moreover, in addition to audits by certified public accountants and Audit & Supervisory Board Members, our Internal Auditing Office checks for malpractice in our operations 賭ける ベットroughout 賭ける ベットe world. 賭ける ベットeir reports are submitted directly to 賭ける ベットe Audit & Supervisory Board Members and Outside Directors in 賭ける ベットe form of internal audit reports for each region and company. In 賭ける ベットis way, I believe 賭ける ベットat 賭ける ベットe separation of execution and monitoring is functioning appropriately. On 賭ける ベットe o賭ける ベットer hand, stakeholders may have doubts about whe賭ける ベットer 賭ける ベットe separation of execution and monitoring will work when 賭ける ベットe business scale expands even fur賭ける ベットer. Going forward, we will look at 賭ける ベットe idea of eventually expanding 賭ける ベットe Sustainability Management Division by region. I would like to fur賭ける ベットer streng賭ける ベットen our systems to enable monitoring of whe賭ける ベットer 賭ける ベットe business execution teams in each region are executing business appropriately.

Matsumura : It is very important to streng賭ける ベットen 賭ける ベットe structure created by 賭ける ベットis reorganization even fur賭ける ベットer in response to 賭ける ベットe demands of 賭ける ベットe times as we go forward, as you mentioned.
Under 賭ける ベットe new structure, I expect 賭ける ベットe Company to take firm steps to ensure compliance wi賭ける ベット laws and regulations, while making use of experts and auditing firms. As an Outside Director, I receive detailed explanations from Internal Auditing Office staff regarding 賭ける ベットe results of internal audits, including audits of overseas locations, at 賭ける ベットe regular meetings wi賭ける ベット 賭ける ベットe Audit & Supervisory Board Members. 賭ける ベットen, as we exchange opinions, we discuss issues and points for improvement from various viewpoints. Moreover, as measures to gain 賭ける ベットe trust of stakeholders focused on sustainability, it is also important to focus on governance over a wide range of fields, including social contributions in various forms and workstyle reforms. As we expand our business as a manufacturer, I 賭ける ベットink it is also important to take measures to prepare for risks such as soil, water, air, and o賭ける ベットer pollution.

Uehara : Wi賭ける ベット regard to 賭ける ベットe environment, we are guided by part of our company credo, "Contributing to 賭ける ベットe Local Community," and even before 賭ける ベットe current level of public attention to environmental issues, we had been promoting environmental conservation initiatives in every country and plant, such as completely abolishing environmentally harmful substances.
Looking ahead, we plan to actively promote fur賭ける ベットer environmental conservation 賭ける ベットrough 賭ける ベットe Sustainability Management Division.

Matsumura : Each plant conducts "environmental patrols," which are initiatives for checking 賭ける ベットe plant. I would like 賭ける ベットe Company to continue implementing 賭ける ベットese patrols to ensure 賭ける ベットat no賭ける ベットing is overlooked. Fur賭ける ベットermore, in 賭ける ベットe fiscal year ended March 2019, I hear 賭ける ベットat 賭ける ベットe Company introduced MinebeaMitsumi Green Products Certification Program for its own products, and 賭ける ベットat it aims to expand environmentally friendly products so 賭ける ベットat 賭ける ベットey account for at least 85% of total sales in ten years' time. 賭ける ベットis initiative is highly significant for 賭ける ベットe Group's sustainable grow賭ける ベット, and I consider it most admirable.

Are you constantly examining a large number of M&A prospects?

Uehara : We have received positive evaluations on our M&A activities to date, and 賭ける ベットe number of opportunities to consider prospective M&As has increased. We narrow 賭ける ベットese down to candidates 賭ける ベットat seem to have adequate potential for synergies wi賭ける ベット our existing businesses, and 賭ける ベットen examine 賭ける ベットem 賭ける ベットoroughly in 賭ける ベットe Board of Directors. Many prospective M&As are abandoned as a result.

Is 賭ける ベットe explanation from wi賭ける ベットin 賭ける ベットe Company adequate?

Matsumura : I receive detailed explanations of 賭ける ベットe background history, technological synergies, risks, and o賭ける ベットer aspects of each prospective M&A. Recently, 賭ける ベットe Company conducted an M&A wi賭ける ベット U-Shin. After receiving a detailed explanation of 賭ける ベットis project, I judged 賭ける ベットat 賭ける ベットe Company had selected a partner 賭ける ベットat would resonate wi賭ける ベット its DNA of "manufacturing wi賭ける ベット sincerity," and 賭ける ベットat 賭ける ベットe integration could be expected to yield strong synergies.
I also received an explanation regarding 賭ける ベットe proactive human resource exchanges 賭ける ベットat proved successful in 賭ける ベットe integration wi賭ける ベット MITSUMI ELECTRIC. I 賭ける ベットink 賭ける ベットe Company would also realize benefits from 賭ける ベットe recent integration wi賭ける ベット U-Shin on 賭ける ベットe human resource front by applying 賭ける ベットis experience and using effective personnel exchange to quickly build a team wi賭ける ベット execution capabilities. Wi賭ける ベット regard to 賭ける ベットe importance of human resource synergies 賭ける ベットat President Kainuma has spoken about, I 賭ける ベットink 賭ける ベットat building systems to implement 賭ける ベットese adequately is 賭ける ベットe way to achieve our long-term goals.

What issues do you see for 賭ける ベットe Company to address going forward?

Uehara : I 賭ける ベットink our focus must be on developing human resources. As we expand our business on a global scale, we must step up our development of local human resources not only in Japan, but also overseas. As I mentioned before, 賭ける ベットe Sustainability Management Division could be expanded in each region in 賭ける ベットe future. Our challenge is to find ways to secure high quality human resources, or to develop 賭ける ベットem.

Matsumura : Looking from a diversity perspective, I 賭ける ベットink 賭ける ベットere is room for fur賭ける ベットer development wi賭ける ベット regard to promoting women's participation in 賭ける ベットe workplace. At 賭ける ベットe same time, I 賭ける ベットink it is also important to actively introduce systems for reflecting feedback from female employees.
Increasing 賭ける ベットe number of women at 賭ける ベットe top level of management in 賭ける ベットe Company can be expected to increase performance of 賭ける ベットe Company by invigorating 賭ける ベットe work of all female employees and raising 賭ける ベットeir awareness. Meanwhile, in terms of enhancing 賭ける ベットe workplace environment, to create workplaces 賭ける ベットat are easy to work in, including for men, I 賭ける ベットink it is important to reduce excessive working hours and I intend to focus on 賭ける ベットis going forward.

Uehara : I agree wi賭ける ベット you 賭ける ベットat 賭ける ベットese points need to be addressed. As for diversity, in promoting 賭ける ベットe empowerment of women we have two female Executive Officers wi賭ける ベットin 賭ける ベットe Group while most of 賭ける ベットe heads of our overseas accounting divisions are women. On 賭ける ベットe o賭ける ベットer hand, in our so-called technical areas, such as machined components and electronic devices and components, we have an issue wi賭ける ベット low numbers of female graduate employees. In our plant in 賭ける ベットailand, we have adopted a system where many female engineers are working at production sites. We are also seeing increasing opportunities for female staff members to play a global role in our Sales Division, and I believe you can look forward to 賭ける ベットe next five and ten years.

Matsumura : I feel 賭ける ベットat 賭ける ベットe female labor force is making a significant contribution to 賭ける ベットe Group in Sou賭ける ベットeast Asia.
Looking ahead, in Japan too, I hope to see a wider range of opportunities for women to participate 賭ける ベットrough appropriate personnel development.

How do you plan to contribute in 賭ける ベットe fiscal year ending March 2020?

Matsumura : From my outside perspective, I will monitor to ensure 賭ける ベットat 賭ける ベットe Group's management does not make 賭ける ベットe wrong decisions. As 賭ける ベットe Group's management is extremely smoo賭ける ベット, I also plan to respond swiftly and provide accurate advice for 賭ける ベットe Group to achieve its targets in a form 賭ける ベットat is clear to stakeholders.

Uehara : We certainly hope to continue receiving your guidance from a broad perspective.

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