The origins of the ShinMaywa Group date back to 1920 and the establishment of an Aircraft Department within Kawanishi Machinery Company, our forerunner.The department later became Kawanishi Aircraft Company, a dedicated manufacturer of aircraft, and produced high-performance aircraft models.
After World War II, there was a ban on aircraft manufacturing in the country, but the post-war recovery was a fresh start for the company that led to the core businesses of the ShinMaywa Group today. Our predecessors had a strong sense of mission. They were committed to Japan’s reconstruction and to protecting the jobs of the company’s employees, so they first got involved in manufacturing small daily commodities that people needed. There was a spirit of making whatever could be made. The company later developed a dump truck using proprietary technologies, a project that started with doing repairs on U.S. military vehicles. Drawing on technological capabilities cultivated in the days of Kawanishi Aircraft Company, our predecessors provided the world with products and equipment that were needed by society, including self-priming pumps and various types of industrial machinery. We bow our heads to the power they possessed.  
The company continued to harbor hopes of one day again making aircraft and in 1952 it gradually recommenced its aircraft business. It also got involved in the infrastructure business, which was expanding alongside Japan’s high economic growth. This included submersible pumps for sewage treatment, mechanical car parking systems, and refuse transfer station systems. As a result, the company came to possess the five businesses it has today.
There are now numerous dedicated manufacturers in each of these fields, so we feel pride in the fact we were the forerunners in these industries. Our spirit and stance have not changed since our founding. Through our high-level technological capabilities and extensive experience, we solve the issues facing customers and give tangible form to their needs. We continue to maintain this same spirit today.

Of these five businesses, I think the product that is perhaps most familiar to people is our special purpose trucks. Our dump trucks and refuse compactors(garbage trucks), which exemplify special purpose trucks, maintain a high market share in Japan. One in two of these trucks has the ShinMaywa logo. If you live in a condominium complex, the mechanical car parking system may be made by ShinMaywa. We also build environmental facilities that compact and sort the garbage you throw out on its way to its final disposal site and handle various products related to water treatment, including submersible pumps that pump sewage to sewage treatment facilities. Moreover, ShinMaywa components are used in the commercial aircraft we all fly in. As you can see, most products of the ShinMaywa Group have many points of contact with our daily lives.
In recent years, with the dramatic advance in digital technologies, including AI, IoT, and image processing, we have also been working to make our products and services smarter (automation, unmanned/laborsaving,improved convenience and safety, etc.) to fully accommodate the needs and requests of the customers who use and operate the Group’s products and services.
In addition, there is greater uncertainty in the world now than before given the spread of the COVID-19 pandemic, the frequency of major natural disasters in various regions, and the emergence of geopolitical risk as represented by Russia’s invasion of Ukraine. In order to accommodate a business environment that is changing rapidly alongside all of these changes, we will secure and train DX human resources to put into practice our digital transformation (DX) strategy,which is positioned as a particularly important facet of our management strategy, and will robustly implement a human resources strategy that includes D&I initiatives for taking maximum advantage of individual diversity, which is essential to the growth of the Group.

I will now go over our value creation process, which refers to the cycle of management activities in the Group.
The foundation of our management is the ShinMaywa Group Philosophy, at the top of which is our Corporate principles. On this basis, we are working to embody our Management philosophy and Long-term vision, which has a target year of 2030.

長期ビジョン

Under the Long-term vision, we plan to promote a form of management oriented to growth and expansion from a long-term perspective, one that is not caught up in the most recent changes or focused on earnings alone. The vision outlines our aspirations for 2030, which are the key to this. This is the first time the ShinMaywa Group has taken this approach. 
Our Long-term management plan SG-Vision 2030 presents a roadmap to the achievement of the Long-term vision. FY2023 marks the third year of SG-Vision 2030.
The ShinMaywa Group has many contact points with social infrastructure, so we need to be constantly aware of global megatrends. From among demographic changes, the progress of climate change initiatives, rising geopolitical risk, changes in the social structure and lifestyles, and technology evolution, we have selected themes that have a particularly deep relationship to the ShinMaywa Group and are monitoring related changes.
In addition, we manage main input capital, the inputs in the value creation process, using the categories of financial capital, human capital,manufacturing capital, intellectual capital, social and relational capital, and natural capital, and have defined key issues (materiality) for each of them.

We organize the Group’s input capital in terms of these six categories and consider and make allocations for addressing each of the key issues (materiality). SG-Vision 2030 constitutes the foundation for this. Oriented to achieving the Long-term vision, we are engaged in eight themes on the pillars of two management policies: Long-term business strategies, which promote the growth and expansion of business, and strengthening of management foundations, which fortifies our footing.  Recognizing, however, that ten years is a long span to be promoted under a single plan, we are working toward the goals of the Long-term management plan through three Medium-term management plans,which have “Transformation,” “Expansion,” and “Advancement” as themes.

The keys to growth and expansion are a segment growth strategy to expand the scale of core businesses and new business creation. To expand the scale of core businesses, we will accelerate the process of adding high value to products and services and carry out initiatives centering on the acceleration of overseas expansion and strategic M&As.

Regarding the acceleration of the overseas expansion,we had  generally established sites on a business-bybusiness  basis in response to the needs of customers and business partners, but going forward we will put particular priority on manufacturing and sales and ensure close coordination between business divisions and with overseas Group companies to demonstrate the Group’s strengths. We will carefully consider markets where synergies can be expected and commit management resources on a concentrated basis to those regions.

Regarding strategic M&As, in the Japanese market,we will focus on industry reorganization and strengthening our lineup of products and services and will promote an M&A strategy that seeks to maximize synergies based on a firm grasp of our strengths and challenges. With regard to overseas expansion as well, in order to use M&A to gain a foothold for expanding into certain regions, we will actively consider adding prominent companies in those regions to the Group.

As for new business creation, we currently have five businesses, which are the product of the history I discussed above, but they were all formed before 1980s. We feel a sense of crisis from not having effected a major change ourselves since that time, which was one of the driving forces behind the creation of the Long-term vision. Creating a new business and getting it on track for success is no easy task in a mature society, but we are in an era in which change is emerging in various strata that topples the conventional wisdom, so one might say there is also substantial opportunity. We will not proceed hastily. We are working toward the goal of establishing a considerable position in a new field in 2030, a little way into the future.

In addition, in order to successfully expand the scale of core businesses and create new businesses, it is imperative that we create an environment that allows us to flexibly accommodate market changes and also establish a development environment for new businesses and products.
For this reason as well, going forward it will be essential for us to promote DX, which includes business process innovation centered on data and business model transformation not possible through the mere extension of existing businesses, and we will aim to establish organizational capacities that allow us to achieve this.
Alongside growth and expansion, we must also focus on strengthening management foundations. For the ShinMaywa Group, which transitioned to the Prime Market in 2022 and is oriented to overseas markets in its business activities as well, it is essential that we work to meet social requirements from a global perspective. To be acknowledged by customers and business partners as a corporate group worthy of trust and to be recognized for sustainable growth potential by the world’s investors, we have incorporated strategies that emphasize the environment, society, and governance (ESG) into our Long-term business strategies and efforts to Strengthen management foundations and will report on their progress each year though this report so that they can be properly evaluated. In particular, in promoting the six input capital key issues and our Long-term management plan, we will also focus on Human capital management, which includes formulating a human resources strategy linked to management strategy, promoting the acquisition and optimal placement of key personnel, and working to raise employee engagement while increasing  corporate value.
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We will repeatedly carry out the series of management activities that constitute our value creation process and work to achieve the following targets of our Long-term vision, SG-Vision 2030, in the target year of FY2030.

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Around half a year is left on SG-2023, and we are currently working to formulate our next Medium-term management plan, which is the second phase and has “expansion” as its theme. In the structure of our Long-term management plan, these ten years are tied together through three Medium-term management plans, and this next medium-term management plan plays a central role in this. It is being formulated primarily by organizing the unresolved challenges and newly emerged risks of the first phase, taking into account the most recent megatrends, and backcasting from the ideal presented in the Long-term vision in order to identify items to be undertaken during this period and incorporate them into specific initiatives. The net sales target of 400 billion yen or more is approximately two times our current level, and we recognize that the target for overseas sales, which is to account for over one-quarter of this, will not be achievable without taking decisive measures that are without precedent.
As for concrete measures, we will persistently engage in new business creation, as I mentioned previously. This will pivot on whether or not there are prospects for generating earnings in new fields and on the success of collaborations and M&A with promising companies in Japan and overseas. Regarding new business creation, as of the present we are involved in themes related to energy, water and resources, mobility, digital, and others, and they are all in alignment with our intention to advance Urban, Transportation, and Environmental infrastructure as stated in our Long-term vision. We will earnestly work under our next Medium-term management plan to give concrete form to a business domain that will constitute a new pillar for the ShinMaywa Group.
Alongside this, we will also need to take inventory of existing businesses in order to make effective use of limited management resources. During the period of the SG-2023 plan, the Board of Directors shared information and held discussions on the current position and future potential of our major products. Going forward, we will closely study the future value of each business and product with a focus on global markets and also consider reshuffling our business portfolio based on this.

It has been one year since the ShinMaywa Group issued its first Integrated Report. With publication of the inaugural report, we noticed areas where the daily management cycle was not being implemented as depicted in the value creation process and found areas related to coordinating individual initiatives to meet targets that were in need of revision—there were many points that warranted critical reflection, but I acutely feel that incorporating the major content of management into the value creation process and implementing management based on this over the course of this year will be pivotal when seeking to gain the understanding of stakeholders regarding the certainty of the Group’s sustainable growth.
Japan has many 100-year companies, but there are very few companies with unique businesses that support social infrastructure that have been continued in multiple fields over many years. This is where the raison d’être of the Group lies.
Those of us working today look back on the over 100 years of history with the desire to be a corporate group that continues to value relationships with customers, continues to strive to enhance technological capabilities, and  enable a smoother functioning society. A life that is more safe and convenient.
We hope that stakeholders will continue their interest in the activities of the Group and provide us with guidance and support.