Jan. 05, 2015
New Year Message for 2015
Happy New Year to all of you! As we start 2015, I extend New Year's greetings from headquarters here in Tokyo to all the members of the Sumitomo Corporation Group around the world.
2014 took a severe toll on our company, with large impairment losses recorded in some projects. However, other business areas generally showed steady growth as a result of effective efforts to enhance our earning power under the BBBO2014. I would like to express my appreciation to you all for every effort exerted over the past year.
Today marks the start of business in 2015. The year will likely see further uncertainty in the world situation. Sumitomo Corporation Global Research is keeping a watchful eye over coming developments related to three key themes to correctly understand the global trend: geopolitics, currency and the crude oil market.
The international political landscape will undergo a material shift in power balance. The United States, in relative terms, continues to lose its influence, for example, in the Middle East and North Africa where social stability and order cannot be expected in coming years, while China will increase its global presence instead. The confrontation between Russia and the EU-US block, which stemmed from the Ukraine crisis, shows no sign of improvement, while Russia-China axis is beginning to form, changing the geopolitical balance in Asia.
The global economy will be considerably influenced by a number of factors, such as the normalization of the US monetary policy, the continued appreciation of the US dollar, and weak prices of natural resources, in particular, crude oil. The rising value of the dollar will have a negative impact on emerging economies stricken by dollar-denominated debt. Adequate precaution may well be required to protect against risks involving those economies, particularly in nations that are largely dependent on oil export and facing political and economic vulnerability. Drop of the oil price impacts countries in different ways. Compared with peak prices recorded prior to the 2008 financial crisis, the recent level has declined to roughly 50% in the US dollar and 30% in the yen. In contrast, prices based on the Indian rupee and Brazilian real are trending at above the pre-crisis level.
On the domestic front, Japan’s economy is expected to recover from the dip following last year’s consumption tax hike and increase stability on the back of the weakening yen, lower oil prices, and political stability. With this view, we will proactively seek new opportunities to expand our domestic business.
For the Sumitomo Corporation Group, 2015 will be a crucial year to overcome the current challenges and return to a growth track.
Our stakeholders are paying closer attention to our words and actions. To regain their confidence in our Group, we will team up to demonstrate our potential to the full.
From now on, we will accelerate the formulation of the next medium-term management plan, focusing on drastic management reform and strong growth strategy.
We have initiated management reform initiatives, begun to review the governance structure and decision-making process which are imperative subjects.
As for the development of our growth strategy, we are currently in review and we intend to clearly define our path to the future. One vital element to this task is the formulation of medium- to long-term strategies that are underway at each organization. We should sufficiently discuss from a broad perspective to redefine our strengths and capabilities that will lead to future growth.
The most important thing to achieve our goal is to ensure that business divisions perform to their fullest on the frontlines and corporate functions effectively support their activities. The next medium-term management plan should be developed to facilitate such concerted efforts throughout the Group.
For vigorous advancement through this crucial year, it is necessary to first bring out the full potential in each of us and then make it fully contribute to stronger organizational performance. Each of us should think and act vigorously and persistently with a strong sense of pride and commitment, and deliver our opinions and talk thoroughly among ourselves so that individual competence will fully serve to strengthen the organization’s capabilities. Continuing this basic process, we will enhance our earning power.
These efforts, more than just serving the 2015 goal, aim to achieve “What We Aim to Be in 2019” with our slogan “Be the Best, Be the One.”
Under this vision, we work to become a leading company in each industry in terms of both qualitative and quantitative aspects; a corporate group that is recognized by society as meeting and exceeding the high expectations directed towards us, winning unparalleled trust and respect from business partners and customers. The vision also pursues a higher level of growth toward 2019, our centennial year, aiming to build a solid foundation to enable stable and continuous growth for another 50 years and even 100 years.
This vision will never waver despite changing business conditions.
We have more than 70,000 colleagues working globally. Each member has a different role, but we all share the same goal. Concentrating both individual and organizational capabilities, as well as everyone’s enthusiasm, we will take a solid step toward the shared goal.
Let’s band together to advance through the crucial year ahead, showing our robust strengths.
To conclude my New Year’s greeting for 2015, I extend my best wishes to you, hoping this will be a year of good health and successful activities for all of you in the Group around the world and for your families.
Corporate Communications Department,