Regaining trust and fulfilling our social mission
Chairman and Chief Executive Officer
Ensuring the principle “open, fair and clear” constantly
I would like to express our sincere apologies and regret over the anxiety and concern we caused many of our stakeholders through the inappropriate accounting practices discovered at the overseas subsidiaries of Fuji Xerox, our Document Company.
We have responded rapidly to improve the situation by revamping the management organization. A number of representative directors and some executives responsible at Fuji Xerox have been retired, while we have also dispatched directors from FUJIFILM Holdings Corporation. We have integrated the business management divisions of Fuji Xerox into our company to further facilitate personnel exchanges within the Fujifilm Group, and established a Governance Strengthening Committee personally spearheaded by the President of FUJIFILM Holdings Corporation. These measures are the first of many steps we are taking to implement stronger governance from five different perspectives, including enhancing the management of our Group companies, restructuring our internal audit system and greater IT deployment.
Moreover, we are working once again to remind all Fujifilm employees of the responsibility that trust in our company owes to our activities and to carry out their business tasks in a disciplined and ethical way. Photographic film is a major product that we have been manufacturing and selling for many years. Customers cannot check the quality of photographic film when purchasing the product; this relies solely on the reputation we have built up over the years and the trust that customers have in our products and services. Because these are our origins, we have long been aware of the importance of retaining the trust of our customers and society. There is no shortcut to gaining trust. The keys to regaining trust are the integrity of all our employees and continuing to supply products and services that are worthy of our customers' expectations. We are committed to regaining your trust by ensuring that all our employees recognize the issue as their own responsibility and encouraging them to make our business activities always “open, fair and clear.”
Moving forward in pursuit of business growth and contributing to social issues
Under the new corporate slogan ”Value from Innovation“ adopted in 2014, concerted efforts have been made to achieve the goals of our Medium-Term CSR Plan, ”Sustainable Value Plan 2016“ (SVP 2016) and our Medium-Term Management Plan, VISION 2016.
The business performance figures for FY2016, the final year of the management plan, were ¥2.3222 trillion in consolidated sales and ¥172.3 billion in operating profits. If we exclude the impact of the appreciation of the Japanese yen on our foreign currency earnings, we enjoyed increases in both our operations-based sales and operating profits. Net profits attributable to Fujifilm shareholders achieved an all-time high of ¥131.5 billion, and Return On Equity (ROE) was at 6.5%. The activities of the last three years have enabled us to build our strength, chiefly in the areas of highly functional materials, medical systems and imaging solutions, establishing a portfolio capable of longer-term growth.
Under SVP 2016, our CSR policy of being “conscious of environmental and social impacts within business processes” was expanded to include “resolving social issues through business activities” to forge stronger links between our business and CSR activities.
In the area of health, we are improving accessibility to medical care services through installation of diagnostic systems, wider application of medical technologies, and by providing education & training support for medical staff, and medical examinations, etc. in the Middle East, Africa, Russia and other parts of the world. And we made solid progress in dealing with unmet medical needs founded on the development of regenerative medicine and pharmaceuticals.
In the area of the environment, our exclusive magnetic tape for data storage has drastically reduced electricity usage to contribute to the reduction of CO2 emissions at our customers’ sites by 19.67 million tons. With the advent of the Big Data era, data storage management is becoming increasingly important. The Group also achieved a 14% reduction in overall CO2 emissions over the level for the base year of FY2005 through implementing emissions reductions in procurement through to the product usage and disposal stages.
For these activities, we have been recognized by the 2017 Certified Health and Productivity Management Organization Recognition Program, by the FTSE Blossom Japan Index of the Government Pension Investment Fund (GPIF) and in the MSCI Japan ESG Select Leaders Index for new ESG investment (*).
By linking VISION 2016 with SVP 2016 over the past three years, we have been able to produce solid results through our drive to achieve business growth and to contribute to resolving social issues.
* ESG investment: Investment made from the three perspectives of the environment, society and governance.
Surviving and succeeding in the new industrial revolution with SVP 2030 and VISION 2019
Founded on solid results and experience, in August 2017 we announced our new CSR plan, Sustainable Value Plan 2030 (SVP 2030), and our new Medium-Term Management Plan, VISION 2019, to ensure further business growth.
In the world, global business activities have been activated aiming to achieve the long-term Sustainable Development Goals (SDGs) adopted by the United Nations by 2030, the goals of the Paris Agreement on arresting climate change, and other global efforts. Especially governments and global business corporations around the world are competing to trigger a new industrial revolution by mobilizing AI, IoT and other technologies. Only businesses that are able to implement medium-range strategies with a long-term perspective and foresight will be able to survive and contribute to society as truly global corporations.
The target of SVP 2030 is set for the year 2030 to show the Fujifilm Group’s long-term objectives. VISION 2019 sets out our specific business strategies for the next three years based on these objectives.
When we established SVP 2030, we comprehensively assessed social issues on a global scale, including climate change and the 17 goals and 169 targets set out in the SDGs, and our business fields, technological capabilities and management and human resources. In SVP 2030, we plan to (1) tackle issues in four areas: the environment, health, daily life, working styles; (2) enhance the CSR framework to ensure that the environment, ethics and human rights are respected across the supply chain; (3) strengthen our corporate governance. As for the corporate governance, we will promote a thoroughly open, fair and clear corporate culture in which, as a group corporation, we place a longterm emphasis on our Code of Conduct. Naturally, social issues cannot be resolved overnight. With the announcement of numerical targets for environmental issues and progress indicators for key issues, we will ensure that all employees recognize their own plans and promote their plans into certain achievement. SVP 2030 sets out the foundations of our business operations. With the concerted efforts of both management and employees, we will survive and achieve success in the coming industrial revolution.
Consolidating diverse capabilities within the Group to contribute to realization of a sustainable society
Reactionary movements against globalism are emerging worldwide—these can be clearly seen by the UK's Brexit decision, the “America first” policy, the withdrawal of the US from the Trans Pacific Partnership Agreement, and the rise of the far right in Europe. In addition, the emergence of geopolitical risks and military tensions in various parts of the world represent adversity for global corporations. However, solid economic growth—chiefly in Asia and Africa—and the desire for enrichment and secure livelihoods continue to grow without interruption. It is clear that this presents global businesses with opportunities for business growth and social contributions.
Fujifilm Group is a global company operating across 15 industrial sectors and employing 79,000 people in 277 Group companies all over the world. Our employees in each of these countries are able to make a great contribution by working on social issues, uncovering business opportunities and supplying products and services with precision and speed.
As the SDGs state, the human race now faces a wide range of issues that require attention. At the same time, they are intricately interrelated, requiring the coordination of a large number of people and organizations. For this reason, it is important to build a corporate climate that is “open, fair and clear,” accepting differing values and embracing diversity.
The strength of a business enterprise is in the sum total of the power of the people working in the organization. When each and every employee has the passion and a strong determination to build a better future for themselves and works hard to resolve difficult issues, both the company and society will be able to achieve sustainable growth. When a diversity of employees with different nationalities and cultures come together to achieve common goals and interact to develop and respect their own individual potential, the resulting power is greater. We will continue to create new values to fulfill our corporate philosophy: “to help enhance the quality of life of people worldwide,” and to help develop a sustainable society.