What’s the biggest change you’ve noticed under the new management team?

Well, first, I’m pleased with the continuity. The Company is continuing to derive solid business results from its pursuit of operational excellence, backed by HOYA’s signature strength in strict operating portfolio management and its management philosophy of thoroughgoing insistence on profitability.

What’s changed dramatically since Mr. Ikeda’s elevation to CEO are two new measures to strengthen the HOYA organization. The first of these is Ms. Nakagawa’s appointment as CSO in March 2022. Under her leadership, dedicated ESG organizations have been established at the head office and in each division, strengthening and accelerating the implementation of our ESG strategies. From my perspective as an independent director, HOYA’s performance has improved, but many areas continue to require improvement in comparison with best practice, particularly the “E” (environmental) and “S” (social) components. Having said that, an organizational structure is now in place and the management team’s sponsorship of and commitment to ESG have been made explicit. This is significant progress. The second new measure is the introduction in October 2022 of an in-house-company system. At this point, we have established three in-house companies and are exploring ways to enrich them, including through ongoing deliberations by the Board of Directors. In the near future, I strongly expect to see benefits that can be clearly measured in numbers, as the further sharing and effective use within in-house companies of human capital and assets result in development of innovative products and services, improvement of our global footprint, more effective use of organizational and human capital, cost benefits from shared services, and so on.

From your perspective as an independent director, what management issues do you think HOYA should focus on?

I’m delighted to see that HOYA is achieving consistently strong business results and enjoys a sterling reputation in the market. But if we look at examples of the ups and downs companies have suffered in the past, we can clearly see that undue focus on the short-term bottom line has often prevented companies from attaining medium- to long-term goals or led to the decay of their corporate cultures. Now, precisely because of the dominant position it enjoys in certain fields, it is most urgent for HOYA to create the businesses that will drive clear growth for the future. For example, I believe HOYA should consider acquiring companies in fields with strong affinities to its core competencies and where powerful synergies can be expected. If strong candidates emerge based on numerous perspectives, including technology, human capital, and customer base, HOYA should take swift action. The Board of Directors is currently verifying various scenarios and engaged in ongoing discussions with the management team to hammer out a plan of action that judiciously balances short-term profitability with medium- to long-term growth potential.

We also need to construct an organization-wide process for succession planning, for the CEO as well as other leaders. At this time, our Chief Human Resource Officer (CHRO) is overseeing an overhaul of our global personnel system. By rendering our personnel pipeline more transparent, we can clarify the current status of development of leadership candidates and the talents we will need in the future. I believe that implementing personnel management in a planned and time-effective manner is an especially important issue for HOYA as the Company battles in the global market.

What, then, are HOYA’s core competencies?

First, HOYA has been a leader in the fields of optics and precision machining for over 80 years, and its position in this market is solid. Second, the management team constantly assesses the market dominance of each business, and its thorough, organization-wide commitment to profitability is uncompromising. Third, its ability to respond rapidly to crises and risks is superior to most other companies.

I should also add that, though I’m not sure this qualifies as a core competency, when I was appointed director in June 2018 I was immediately surprised to learn that the administrative division of the head office is run by an elite corps of just a few people and that the division of roles is clearly and effectively defined. Even now, it is rare to find a company whose head-office functions are handled by so few people. At times, I think it would be helpful to add a few more people to the this team. Of course, I understand that the grounds for this slim management are a policy that personnel should be posted as close to the front lines of business as possible, and that the wisdom of this policy is proven by the clear allocation of responsibilities among the head office, in-house companies, and divisions and the clear distinction between in-house tasks and outsourced tasks.

What issues do you expect the Board of Directors to focus on going forward?

I think they’re basically the items I mentioned earlier. Important points that the Board of Directors is currently overseeing and supporting include continuous evaluation of our operating portfolio, clarifying our growth strategies for the medium to long term, advancing our ESG strategies, and constructing a systematic approach to succession planning.

Of these, growth strategy and evaluation of business portfolio strategy are closely intertwined. As it deliberates on revisions to its portfolio, the Board constantly searches for opportunities to generate Group-wide synergies. To offer fresh market value as only HOYA can, we have to devise growth strategies that are consistent across the Group at the in-house company and division levels. Another vital task for the Board of Directors is to deliberate on the proper state of R&D as the source of our growth strategy, under our Vision of “Innovation for a Better Tomorrow.” As we hammer out our ideal growth strategy and future state, I have great expectations for the knowledge, experience, and skills of Mr. Ikeda, who has been in charge of business divisions, COO and Chief Technology Officer (CTO) before becoming CEO.

One of the most important roles the Board of Directors has is the appointment and dismissal of CEOs in ways that uphold the trust placed in it by stakeholders. The Board supervises the management team, and supports and works diligently with it, so that its members can realize their full potential based on their talents and experience and become better leaders.

And finally, please give us your message to stakeholders.

With its outstanding management resources and excellent market positioning, HOYA is blessed with strong potential for growth. Despite the uncertainties of the business environment, as an independent director I am sincerely committed to supervising and supporting the management team in the execution of its duties from an independent perspective. My aim in doing so is to improve corporate value over the medium to long term while enhancing quality of life for individuals and promoting ESG strategies that contribute to the formation of a society that is in harmony with people and nature. I ask for stakeholders’ continued support in this endeavor.