Executive Commitment

We will Pursue True Globalization
and Challenge the World under
the Corporate Mission of
“Materials Innovation”

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Producing Results for the World Shifting to
a New Framework

The two keywords that best describe the period from 2011 to 2013, during which the JSR20i3 (“twenty thirteen”) mid-term business plan was implemented by the JSR Group, are “uncertainty” and “diversification.” In 2014, positive signs of economic turn-around began to appear, making us increasingly confident that a new global framework is emerging.
The three-year period of JSR20i3 was positioned as the stage for “activation toward growth” in the process of realizing our vision of what the Group should be by 2020. During this period, although sales increased to nearly a record high, net profit failed to meet the target. While the petrochemical product business achieved record high profits, the fine chemicals business was adversely affected by commoditization in the digital industry, resulting in a lower relative competitive advantage in the market and reduced revenue. On the other hand, this three-year period also saw us develop our clear growth strategy and make decisions on large-scale investments, thus paving the way for the Group to take a great stride forward in growth.
In JSR20i6 (“twenty-sixteen”), a new mid-term business plan that covers the fiscal year ending March 2015 to the fiscal year ending March 2017, our goal is to produce specific results, e.g., generate revenue by making the most of the foundations that have been laid up until now.

Linking All of Our Business Activities to
the Creation of Social Value

In the petrochemical product business, while the global demand for fuelefficient tires is expected to increase, the reorganization of ethylene cracker currently underway in Japan may make it difficult to secure raw materials for synthetic rubbers. We are therefore advancing into regions where the market is open and raw materials are available to produce synthetic rubber for fuel-efficient tires. One such region is Thailand, where a plant from JSR BST Elastomer Co., Ltd. started operations in the fiscal year ending March 2014, even embarking on second-stage construction work to meet the expected increase in demand. We also established a joint company in Hungary in March 2014 to build a new plant with a view to achieving sales there in 2017.
In the fine chemicals business, we aim to meet requirements becoming more complex and high level by keeping up with market changes and taking advantage of our global network while expanding our business into sensors and other areas to utilize our technological expertise in order to contribute to the realization of a comfortable, convenient ubiquitous society.
In the strategic business, our third pillar of business, we focus on two areas: lithium-ion capacitors and life sciences. Lithium-ion capacitors are an innovative, energy-saving device, and we are expecting their demand to increase particularly for use in hybrid construction machinery, buses, and other large vehicles to improve their driving efficiency. For example, airport buses in the United Kingdom began to be equipped with lithium-ion capacitors in 2013. In the area of life sciences, focus is being placed on bioprocess materials used in the development of next-generation new medicines. The development of antibody drugs today requires very high costs. Under these circumstances, we are working to develop technologies to realize “disruptive” innovations, such as making it possible to cut production costs in half, or efficiently obtain drug efficacy that could not have been obtained before.
Lithium-ion capacitors and other environmental and energy-saving products are based on the E2 Initiative^TM concept, which comprises “Eco-innovation”— an aggressive approach in which environmental conservation is seen as an opportunity to create new business rather than as a burden—and “Energy management”—a more defensive approach that focuses on the reduction of our environmental impact. Under this concept, we utilize our unique materials to develop and offer products that are both environmentally and economically sustainable, such as synthetic rubber for fuel-efficient tires, thermal management materials, and plant-derived resin, in order to help reduce environmental impact in various applications. At the same time, we also strive to reduce the environmental impact of our production processes, and have achieved our FY2014 goal of reducing total CO₂ emissions from our three plants in Japan by at least 6% compared to FY1991 levels. We are continuing with our efforts to reduce CO₂ emissions even further.
With regard to biodiversity conservation, we procure raw materials while paying due consideration to biodiversity based on an analysis of the supply chain; conduct comparative studies on the impact of synthetic rubber and natural rubber on biodiversity; and create green spaces at our business sites while assessing progress using the “Land Use Score Card”, among other efforts taken. In addition, to further promote these activities, we will work even harder to integrate biodiversity into our business activities. We will also examine what the JSR Group can do for the conservation of water—a precious Earth resource.
As these efforts indicate, the JSR Group has been balancing the enhancement of its business competitiveness and the creation of its social value in every aspect of its business activities, which I believe constitutes the uniqueness and strength of the Group.

Valuing the Importance of True Globalization and
Fulfilling Responsibility to Stakeholders

Of all our Management Policies, we attach great importance to “Responsibility to Our Stakeholders,” particularly “Responsibility to Our Customers/Business Partners.” This is because we believe that ensuring a steady supply of high-quality, affordable materials is indispensable for the creation of innovative products by our various customers, which, together with providing good relevant services, will eventually lead to the sustainable growth of companies and the realization of our Corporate Mission of enriching society through materials.
To fulfill our responsibilities to customers and business partners, management must build an environment that encourages every employee to stay motivated and dedicated to work. At the JSR Group, therefore, executives including myself, put efforts to have bi-directional communications with employees by holding dialogue meetings and through other means. Also, in the last fiscal year, the company decided to increase its matching contributions to the employee shareholding association as a profit sharing incentive for employees who share goals and risks. I also sent five messages across the Group to tell employees about specific examples of “Materials Innovation” that was beginning to be materialized and how it would contribute to social changes so as to bring about even greater excitement and motivation in their work.
In FY2014, the ratio of overseas sales to total sales exceeded 50% for the first time, with about a half of the total generated by products produced and sold abroad. Our workforce comprises about 4,200 employees in Japan and about 1,400 employees abroad. From this, it can be said that the JSR Group’s business is experiencing a shift from being Japan-oriented to becoming truly global. To address this trend, we require even more dynamic human resource management, such as personnel exchanges between overseas business sites and local training. The JSR 20i6 mid-term business plan, therefore, has added a global approach to our traditional personnel management, which places emphasis on what human resources are needed, what human resources we have, and how they should be trained on a global basis. We also need to deepen our understanding of diversity. People are diverse in nature, and we need to make the company open to diversity. The activities we have been conducting to ensure dissemination of the Essential Elements across the Group will be important in the area of diversity as well.
Safety is the first and foremost important issue for manufacturers. As many accidents occurred in chemical plants recently, the JSR Group is currently carefully checking safety activities and techniques that have been implemented by us as a matter of course in response to such problems.
We firmly believe that these and a number of other painstaking efforts will result in the fulfillment of our responsibilities to society and shareholders, and eventually lead to the creation of value.

Our Aim is to Realize Our Corporate Mission and
Become a Corporate Group with a Strong Global Presence

The JSR Group’s Corporate Mission is to contribute to society through “Materials Innovation.” To achieve this mission, we have declared our participation in the United Nations Global Compact, and through this and other commitments, we aim to act even more responsibly in the international community. We must continue our efforts to increase the quality, efficiency, and fairness of our business operations to meet and exceed international standards. At the same time, we also need to continue to value strengths that Japanese companies possess as well. High technological prowess and quality nurtured by Japan over many years have been and will continue to be powerfully appealing and trusted in markets around the world.
We will continue to stay ahead of the ever-changing times and pursue innovation to become a corporate group with strong global presence. Our pursuit of new challenges is never-ending.

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