代表取締役社長 朝倉 研二

We will achieve sustainable growth by balancing economic and social value, with the aim of creating a sustainable world where people live with peace of mind.

We have formulated a vision for 2032, which marks the 200th anniversary of our founding. It is to become “A Business Designer that Creates a Sustainable Future.” Since my appointment as president, I have continuously used the words “Business Designer” to describe our vision. It expresses our aspirations to become an enterprise that can design businesses with customers through R&D, DX (digital transformation) and manufacturing. We are determined to have NAGASE create new business models without being constrained by the traditional boundaries of a chemicals trading firm or imitating anybody else.

We have once again set the core themes of the new medium‑term management plan as reform of our profit structure and corporate culture. This is to ensure that we continue to build on the signs of progress on reforms we saw during the previous medium‑term management plan without interrupting these efforts.

Reforming Our Corporate Culture by Enhancing the “Quality” of Business Activities and Creating Economic and Social Value

Under reform of our corporate culture, we have formulated three policies. The first policy is the pursuit of economic and social value. As the realization of a sustainable society becomes urgently needed globally, my awareness as a business leader is that companies must not merely strive to grow the top line and expand the size of their businesses. Of course, the NAGASE Group has so far provided value to society through its business activities and worked to realize a sustainable world where people live with peace of mind. Going forward, I believe that, as our future direction, we need to build up an organization and foster a mindset that pursues sustainability even further.

The second policy is to pursue efficiency. We will pursue efficiency in each business activity, including improving capital efficiency and raising the profitability of each business. ROIC (Return on Invested Capital) has been adopted as our indicator of capital efficiency. Based on ROIC calculated in each business, we will analyze and classify businesses into four quadrants defined as the “Improve,” “Base,” “Develop” and “Focus” areas and reconsider our business strategies accordingly. Naturally, if a large number of businesses can be classified as “Develop” and “Focus” area businesses, the Group’s condition will be sounder. However, such an outcome would be unrealistic. In the NAGASE Group’s businesses, the “Base” area businesses are generally strong, and they have allowed the Group to build a stable business portfolio. Meanwhile, the lessons from the previous medium‑term management plan have given us a strong sense of urgency—we must work to develop inorganic businesses. ROIC will be employed as one indicator we will consider when we decide whether to shift existing businesses to “Focus” area businesses.

The third policy is to strengthen human resources to drive reforms. The NAGASE Group views employees as important stakeholders. One of the crucial missions of managers is to raise the quality of the workplace environment so that employees can work positively and enjoyably. If employees can enjoy their work, that enjoyment will be the starting point for providing solutions to customers and growing businesses. I am convinced that this process will ultimately lead to the creation of economic and social value through our business activities.

Drive Reform of Our Profit Structure through Expansion of N‑Sustainable Businesses

As part of the reform of our profit structure, we will carry out the pursuit of profitability and efficiency by implementing company‑wide asset replacement and reallocation of resources. Another priority is to strengthen existing businesses. In addition, we will strive to create sustainable businesses (N‑Sustainable Businesses). With N‑Sustainable Businesses, our goal is to provide solutions to generate profits through innovative services and technologies, thereby leaving a sustainable future for future generations. Under the previous medium‑term management plan, we adopted the growth of inorganic businesses as a major theme and have been developing new businesses based on this theme. Under ACE 2.0, we have clearly stated our intention to develop new businesses by providing new value that solves social and environmental issues with a particularly strong focus on sustainability. Our operating income target for N‑Sustainable Businesses in five years is ¥5.0 billion, which represents around 15% of total operating income. This target will not be easy to achieve. However, I believe that achieving it will lay a crucial foundation for realizing the Ideal NAGASE.

We have established the three N‑Sustainable Business fields: Environment and Energy, Next‑generation Communications, and Life & Healthcare. We are not starting any of these fields completely from scratch. For example, Life & Healthcare includes continuous activities and businesses that have newly started, such as initiatives in the food ingredients business and the biotechnology field. Each field offers opportunities for the NAGASE Group to work as an agency or do work that involves manufacturing. There are also opportunities to introduce XaaS (X as a Service) business models, which provide what is known as the consumption of experience. An example of this is TABRASA™, which is a new materials search platform using AI. NAGASE possesses a global network that it has developed through its business in the chemical industry, and it is also well versed in technology. I believe it is crucial for NAGASE to maximize these strengths and contribute to society. Looking ahead, we will strengthen our investment in businesses positioned in the three N‑Sustainable Business fields. A wide range of investment decision‑making criteria other than ROIC are conceivable, including prospects for the future and relevance to social and environmental issues. On the investment front, I believe that our awareness will change markedly compared with our traditional approaches to investing.

Sustainability to support innovation

We see our efforts to promote sustainability as a long road that will continue indefinitely without ending during the period covered by ACE 2.0. NAGASE newly formulated the Sustainability Basic Policy in February 2021. In June 2020, we launched a Sustainability Committee, on which I serve as Chair. Within the committee, we have been conducting lively discussions with the leaders of Group companies in Japan and overseas and research organizations. The process of clearly identifying stakeholders and defining materiality for each type of stakeholder was a major learning opportunity. Specific non‑financial targets will be formulated within the current fiscal year. I believe that it is crucial to make steady strides on this priority, including raising awareness within the Group, without hastily rushing through the discussions.

The COVID‑19 pandemic has been causing unprecedented changes. Under these conditions, I now keenly appreciate the importance of reaffirming our Management Philosophy— maintain the highest standards of integrity. Even in these trying circumstances, if we put this philosophy at the heart of our business activities and communication with stakeholders, I am convinced that things are sure to eventually head in the right direction. It is precisely because of these circumstances that I would like NAGASE to make a company‑wide effort to cherish our management philosophy of maintaining the highest standards of integrity. Looking ahead, guided by this universal management philosophy, all Group employees will make a concerted effort to realize a sustainable world where people live with peace of mind. I cordially ask for your continued understanding and support as we endeavor to reach our goals.

NAGASE & CO., LTD.
Representative Director and President
Chairperson of the Sustainability Committee
Kenji Asakura