Strengthening the Management Foundation to Withstand Future Structural Changes The Cosmo Oil Group continually carries out such businesses as oil exploration and production and petroleum refining and sales and works to bolster a stable earnings foundation. At the same time, we are striving to establish a financial constitution capable of withstanding changes in the business environment and realize future business development. Further, we will strengthen our CSR structure in accordance with our Group Management Vision that is based on CSR and strive toward "Harmony and Symbiosis" and "Creating Future Value" to contribute to the sustainable development of society. Specifically, we have established the Consolidated Medium-Term CSR Management Plan in our efforts to promote CSR management.
Transitioning to a Growth Strategy To adapt to changes in domestic and overseas demand structures, we have undertaken efforts to rationalize and enhance the efficiency of operations. At the same time, we are making comprehensive upgrades at refineries, focusing mainly on strengthening linkages between petroleum refining and petrochemicals. Moreover, to expand our business domains, we are working to expand the scale of our oil product exports to Asia and Pacific Rim markets, strengthen ties with petrochemical businesses, and increase our ratio of equity oil produced.
In our credit card business, under a basic agreement for a strategic business alliance with Aeon Credit Service Co., Ltd., in June 2006 we began soliciting members for "Cosmo the Card Opus."
Regarding new business fields, in Japan and Europe we are promoting the commercialization and development of business for 5-aminolevulinic acid (ALA), which is expected to have applications in agriculture, healthcare, and a wide range of other fields. In new energy fields, we are conducting research and development aimed at commercializing and cultivating markets for Gas to Liquids (GTL) and fuel cell systems.
Consolidated Group Earnings Targets/Indicators
| Fiscal 2007 Earnings Targets | |
|---|---|
| Operating income | 89 billion yen |
| Net income | 37 billion yen |
*Forecast for the term announced on May 16, 2007
In keeping with our Group Management Vision, the Cosmo Oil Group strives to carry out thorough management that emphasizes compliance and stable supplies of safe and adequate energy. We also make efforts to achieve "Harmony and Symbiosis" among energy, society, and the Earth's environment through activities that contribute to society and protect the environment. Additionally, through business development focused on customer and societal needs, we strive toward "Creating Future Value" as we contribute to the development of a sustainable society. To share and steadily implement these concepts throughout the Group, we included "strengthening CSR" in the Consolidated Medium-Term Management Plan initiated in fiscal 2005. As a specific initiative, we also formulated the Consolidated Medium-Term CSR Management Plan to be implemented over the same three-year period in our ongoing efforts to promote CSR-based management.
Basic Framework and Status of Efforts
Different departments and companies that comprise the Group have different relationships with stakeholders. Accordingly, although the Consolidated Medium-Term Management Plan fundamentally entails the initiatives of respective business sites, the plan establishes five policies shared throughout the Group.
1. Improving the awareness of CSR |
In fiscal 2006, the series of legal violations spurred us to strengthen adherence to corporate ethics. We have worked to achieve an understanding of CSR and a familiarity with the Management Vision and Corporate Activity Guidelines through corporate ethics training and level-based training. |
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2. Reinforcing the governance system including the risk management and the internal audit functions |
Each affiliated company has developed a structure for internal audits. Cross-sectional risk management activities are developed by the Risk Management Committee company-wide. In fiscal 2006, this committee established the Business Continuity Plan (BCP) in conjunction with strengthening the internal corporate structure. |
3. Strengthening safety control to support the infrastructure of business activities |
We formulated our Consolidated Medium-Term Safety Plan, in which efforts are made in respective sections, including production, logistics and sales, in accordance with the four major themes: "improve safety control system," "identify and reduce potential risks," "enhance and strengthen our crisis control structure," and "systematically implement education and training." Along with applying the lessons learned from the accident at our Chiba Refinery, in fiscal 2006 we commenced activities meant to prevent a recurrence (Change 21). |
4. Taking a more sophisticated approach to environmental activities |
We have established the Consolidated Medium-Term Environmental Plan and are addressing risks that have impact on corporate activities such as global warming and soil contamination at an early stage, along with other activities such as "Office Clean" activities and activities contributing to the global environment. In fiscal 2006, we concluded an agreement for the purchase of CO2 emission credits. Also, as one element of our environmental communication efforts, we initiated participation-based projects under the Cosmo Oil Eco Card Fund. |
5. Protecting human rights and personnel affairs |
We have established the Consolidated Medium-Term Human Rights/Personnel Plan and are promoting various measures based on the two concepts of "respecting fundamental human rights" and "creating vibrant and comfortable working environments by adhering to a spirit of respect for diversity." From fiscal 2007, we are expanding the amount of time that can be taken off work for childcare leave and upgrading Company subsidizations for usage of childcare facilities as we implement measures to promote a balance between work and private life. |
