Dialogue Between Outside Directors (Sustainability)

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Fulfilling our role as a global enterprise
by integrating sustainability into management

Makiko Akabane
Outside Director Ms. Akabane has led CSR initiatives and set up related organizations as head of CSR at multinational companies in various industries. Drawing from her extensive experience and expertise, she currently offers consulting on sustainability-related issues as a representative director of CSR Asia.

Takahiro Ikeda
Outside Director Mr. Ikeda has served as an executive officer of Mitsubishi Chemical Corporation*, president of Dia Chemical Co., Ltd., and a director and managing executive officer of Mitsubishi Rayon Co., Ltd.*. Having expanded Mitsubishi Chemical Corporation’s operations in Indonesia, he is highly familiar with markets in Asia, particularly the ASEAN region.
* Now Mitsubishi Chemical Group

Recent progress and future challengesIdentifying what is unique to UACJ and having all employees play a part

Ikeda:
I was appointed as an outside director five years ago in 2018. The Company initiated structural reforms in October 2019, but the operating environment changed dramatically over the following three years because of the COVID-19 pandemic. During that period, when we formulated our current mid-term management plan and UACJ Vision 2030, we understood that central importance of sustainability for the Company’s future direction. UACJ has evolved from fulfilling its corporate social responsibility (CSR) through various initiatives to integrating a sustainability approach into its management. I think this was the right direction to take.
Akabane:
I began working with UACJ as a consultant in April 2020, when the Company initiated its process for specifying materiality issues. Now, as an outside director, I am monitoring the progress of its efforts to address these issues. How do you view the Company’s materiality issues?
Ikeda:
Among the six materiality issues, product quality assurance and occupational health and safety are fundamental for any manufacturer, while our response to climate change, respect for human rights, diversity and equal opportunity, and human resources development are all essential issues for creating social value. These six items cover a broad enough spectrum of the issues we need to address, but in my view, they tend to lack specifics and can come across as mere slogans.
Akabane:
It’s true that when we first started exploring questions about materiality, in retrospect, we didn’t fully identify what is unique to UACJ. To put sustainability management into practice, it is essential for each individual to play a part in their work, not just certain assigned employees or departments. For that reason, communication about the materiality issues in the workplace needs to happen on a regular basis so that they don’t end up sounding like slogans.

Building a circular economy for aluminumGenerating public interest is essential

Akabane:
One unique initiative taken by UACJ is its plan to build a circular economy for aluminum, which began in fiscal 2022. Aluminum is highly recyclable, and some companies in other countries are taking proactive steps toward “infinite recycling” in the aluminum industry. Likewise, UACJ is promoting aluminum’s excellent recyclability and the environmental benefits of using it. In Board of Directors’ meetings, we have talked about how to raise UACJ’s presence as a business that creates value for the environment.
Ikeda:
I am following this matter with great interest and high hopes. I want the Company to proactively provide information on infinite recycling, both internally and publicly, because it is a ground-breaking approach that can really benefit everyone. UACJ needs to be more passionate about this to generate public interest. If these recycling initiatives are not widely known, they will have only a limited impact. Therefore, we must send a clear message about the environmental benefits of aluminum to all members of society.
Akabane:
I also think messaging is important. Sending a message with real conviction can create momentum for actions to go forward. One company I worked for, Starbucks Coffee Japan, provides an example. It now has the most outlets among coffee shop chains in Japan, but it was expected to fail when it first entered the market here. Many thought the idea of walking around with paper coffee cup would be a turnoff for consumers. Despite that, its employees were strongly committed to establishing a new brand, and each of them worked hard to make its image appealing in Japan. After entering the country around 30 years ago, Starbucks is now a well-established brand here. In the same way, I would like each of UACJ’s employees to be enthusiastic about explaining the benefits of aluminum to people outside the Company.
Ikeda:
Conveying such messages to the public is also important for building partnerships. To make progress in expanding the scale of a circular economy, we must work with many partners—not only those in the aluminum industry. For example, we could collaborate with plastic manufacturers in Japan or abroad, as long as they share the same desire to protect the global environment. That is the spirit of Sustainable Development Goal 17, “partnerships for the goals.” To accomplish big aspirations, we will have to change people’s mindset, and I would like UACJ to be directly involved in that.

Promoting sustainability for the futureMaking the most of diversity as a global enterprise

Akabane:
There are many issues for global enterprises to focus on in their sustainability management, but in my view, occupational health and safety is an important matter for every company. The ability to work safely is a universal human right, and human rights are featured prominently in the business reports of major companies overseas. In Japan, ensuring occupational health and safety is commonplace and generally taken for granted, but ensuring it abroad is not always easy if employees have different customs. Therefore, companies must also raise awareness among their members while meeting these obligations. In addition to maintaining safety in its workplaces, UACJ should formulate sustainability strategies that connect its businesses to broader issues, like decarbonization, nature positivity, and workforce security. Such strategies can drive growth. In my role as an outside director, I would like to actively propose such strategies and support and oversee their implementation.
Ikeda:
My concern is that global-level materiality issues may not lead to changes in behavior among employees. I am not worried about the direction of UACJ Vision 2030 and the next mid-term management plan currently under consideration, and I expect our efforts to tackle the materiality issues will make progress. On the other hand, even if we put global organizations in place, our measures for tackling each issue are not concrete enough for employees to know what to do. As you pointed out, to step up our sustainability management, all employees must participate, with each playing a part in their work. UACJ, in particular, has grown by forming a group of companies that have diverse members and workplace cultures. With so many subsidiaries around the world, our workforce is becoming more multinational every year. By leveraging this diversity and versatility, and actively engaging with stakeholders and communities worldwide, perhaps we can create the starting points for initiatives that are truly unique to UACJ.