Messages from Outside Directors

In corporate governance, what is most important would be the idea of autonomous systems, as in autonomous distributed systems used in information networks, which is my field of expertise. In an autonomous system, governance is achieved in the entire network, not by forcefully controlling it as a whole but by having every organization work toward the same objective based on predefined principles. At Osaka Gas, I feel that the Company is pursuing the idea of an autonomous organization as I have been supervising the corporate governance of Osaka Gas while participating in active discussions with other Board Members, as an Outside Director since 2013.

Among the initiatives under the Medium-Term Management Plan, I place particular emphasis on our efforts for carbon neutrality and digital transformation (DX). Regarding carbon neutrality, we recognize the importance of implementing decarbonization initiatives that are based on scientific verification in terms of establishing and achieving numerical targets. As we work toward our carbon neutrality goal, we will continue enhancing our initiatives by reviewing results based on objective data and working on simulations.
DX is also a vital issue for an energy company like us. In implementing DX initiatives, it is crucial to strengthen internal systems through developing human resources with IT skills and hiring external talent. As it will require significant investment, I will ensure with other Board Members that decisions will be made based on the results of thorough discussions within the Company.

The Internet of Things (IoT) will make rapid advancements over the coming years with the telecommunications environment expected to continue developing with 5G (fifth generation mobile telecommunications systems), and 6G. Although technological evolution will bring merits for people’s lifestyles and industry, it will also increase security risks and electricity consumption. In light of these points, we will make decisions through careful discussions at meetings of the Board of Directors to implement our initiatives and execute strategies leveraging the strengths of Osaka Gas.

When I consider Osaka Gas’ approach to management, my view is that governance is functioning effectively at the Company. Lively discussions take place at meetings of the Board of Directors, and when I observe the actual worksites where operations are executed, I feel strongly that the intentions of management are reflected in the ways employees work. We will ensure that the Daigas Group will utilize its corporate culture of approaching everything in a genuine and studious manner to further pursue its social mission as a company operating an energy business.

Over many years, I have developed much experience in corporate management through the activities of companies and business associations. I intend to contribute to the Daigas Group’s management enhancement by utilizing my expertise and knowledge on energy business strategies, approaches to governance, potential risks and scenarios to respond to those risks such as in investments, collaboration proposals and new businesses.

We aim to realize that Osaka Gas will become a leading company in the energy business, pioneering initiatives to solve social issues for a sustainable future. It is important that the Company does not just follow national policies and the actions of other companies, but instead take the lead in solving these issues, looking ahead to the times.

In this regard, the Daigas Group has devised its strategies for carbon neutrality and digital transformation in the Medium-Term Management Plan. I have great hopes for the future development of the Group, in particular, the Group’s commitment announced at the President’s inaugural press conference, to the development of methanation, a technology to synthesize methane, one of the main constituents of natural gas, from hydrogen and CO2. With regard to DX, we will not stop at simple digitalization but utilize DX to create solutions to future changes in business models, lifestyles and ways of work.

Achieving success in carbon neutrality and DX requires technical breakthroughs and effective funding plans. To that end, I will support the steady implementation of the Medium-Term Management Plan by providing appropriate advice as an Outside Director. The Daigas Group will strive to create value for a sustainable future while quickly responding to changes in the business environment as the COVID-19 pandemic further affects lifestyles and businesses.

The Daigas Group aims to create the four types of value stated in its Corporate Principles. In order to support the Group’s efforts to achieve it, I am committed to strengthening the Group’s governance as an Outside Director. At the Board of Directors, we strive to make decisions on initiatives for the Group in light of whether our actions will be understood from the perspective of all stakeholders including those outside the Group. This is especially important when engaging in risk management for the Group’s businesses and evaluating the transparency of the decision-making process as well as the consistency of each proposal with the Group’s growth strategies and the validity of their content.

Over the past twelve months since I was appointed Outside Director, I have seen the Daigas Group demonstrating its strength in enhancing governance. Going forward, we will continue discussing constructively the Group’s major policies, such as management strategies and targets. While I admire the Group’s corporate culture that welcomes opinions from all members, I intend to encourage higher participation among all members in exchanging views on these themes regardless of positions and titles.
At the Board of Directors, I will work closely with other members to enhance corporate value based on a shared understanding among all Directors on the prospects for proposals for future developments and the necessity of implementing major reforms at the Daigas Group from a longterm perspective. I will also flexibly take an aggressive approach in governance when we take appropriate risks in order to promote growth.

In implementing the new Medium-Term Management Plan announced in March 2021 (Plan 2023), it is important that we incorporate a mindset rooted in the customer contact points, together with think-and-act approach, in which each employee thinks from the customer’s perspective before acting. In order to spread within the Daigas Group the concept of “value for a sustainable future” under the Plan 2023, we will ensure that the management communicates with employees in an easy-to-understand manner how their day-to-day work will create value for a sustainable future. We will continue building a corporate culture that increases management’s engagement with employees and encourages each employee to work with a higher sense of ownership.

As a new Outside Director appointed in June this year, I am committed to maintaining high standards of corporate governance for Osaka Gas, which is working earnestly to provide social value through its business activities. I feel optimistic about the Company’s future business development as the Company is looking not just to protect its existing businesses, but also actively taking on new challenges and working toward breakthroughs.

As the times change rapidly, companies in any industry cannot simply maintain the status quo as they used to do, if they wish to survive. We must anticipate future trends and define our vision, then work backwards from there to think about what we need to do at this moment. It is also crucial that we focus not just on the ideas of senior management, but also sufficiently incorporate the views of employees working close to customers, in order to achieve a breakthrough. I will visit as many worksites as possible and provide senior management with views from an external perspective as an Outside Director. I intend to contribute to decision-making that is not bound by conventional ways of thinking.
For a company engaged in businesses with regional roots like Osaka Gas, co-creation with local communities is highly important. We will continue engaging in activities that contribute to local communities, and we would like to ensure broader awareness of our activities in this area.

Osaka Gas is a large organization that has been maintaining an earnest and hardworking corporate culture with an enterprising spirit. We will accelerate our efforts to solve management issues, such as promoting more active participation of women, by taking on new challenges with innovative approaches in a timely manner.

With regard to the Medium-Term Management Plan, we will ensure that the Daigas Group will reach the targets while fulfilling its social mission as an energy company to a greater extent than now. To that end, we will continue encouraging all members to work with a higher sense of responsibility and take the initiative in contributing to solving social issues through the Group’s business activities.