The President’s New Year Message for 2018
Happy New Year!
We very much appreciate all your support last year.
I would first like to review the business environment surrounding our company in 2017. In Japan, although corporate earnings and the employment environment remained strong, there was only modest recovery in personal consumption due to sluggish wage growth. Overseas, following recovery of the U.S. economy, the economy in Europe was also on a recovery trend. However, global economic conditions as a whole remained unsettled due to uncertainty over Trump administration policies and heightened geopolitical risks.
In light of these circumstances, we reviewed the three-year medium-term management plan, “Advance Ahead 2018,” which started in June 2015, and formulated a new plan–the 5th three-year medium-term management plan, “2020,” which started in June 2017. Under our new plan, reflecting on the accounting problems that originated at our U.S. subsidiary Suminoe Textile of America Corporation, we focus not only on expanding our business but also on thoroughly implementing various measures to prevent a recurrence of problems, including strengthening compliance with laws and regulations, reviewing our management system, and restructuring our main system.
○ Restructuring of corporate governance
In an effort to restructure corporate governance, we are working in accordance with our “recurrence prevention roadmap” to ensure thorough compliance with laws and regulations and transparent organizational operation, while promoting interactive communication between executives and employees.
Specifically, by sharing information effectively through our standardized weekly and monthly reporting system and promoting interactive communication through top management’s frequent visits to workplaces, we aim to further strengthen visualization of problems faced by each department or workplace in and outside Japan, so problems can be discovered and resolved more quickly. We also aim to enhance corporate governance education for employees, while promoting information sharing. Furthermore, we have launched a major revamp of our IT system, in conjunction with the existing system, in order to establish comprehensive internal control management that is more suitable and effective.
○ Growth of business
A company is a public entity in society and must continue evolving. Although the Japanese economy has been given a boost by strong inbound tourism demand in recent years, many negative factors still exist, such as declining demand due to shrinking population, especially among working-age people. Personal consumption is far from robust despite strong corporate demand. If we fail to act now with bold reforms, it will be difficult to expand and evolve our business. Under such circumstances, as defined in the new three-year medium-term management plan, each business segment is working steadily on expanding its product lineups, strengthening globalization, and developing and selling more high value-added products. We are determined to do everything we can to become a more successful company.
In 2018, by steadily and vigorously pushing ahead with our two core initiatives: restructuring of corporate governance and growth of business, we, all executives and employees, together as one will continue conducting our business activities with sincerity to win trust, essential for any company, from all our stakeholders.
We would like to ask for your continued support for this year.
Chairman and President
Suminoe Textile Co., Ltd.