Yuki Kusumi, Group CEO of Panasonic Holdings Corporation, introduced the medium- to long-term vision and strategy at the Panasonic Group Strategy Briefing in May 2023. This first of two articles introduces his thoughts on the past two years of enhancing competitiveness and the progress of Panasonic GREEN IMPACT.
Can you explain the two years spent enhancing competitiveness and the Group’s new direction?
Our mission, and the lifelong goal of founder Konosuke Matsushita, is to realize “an ideal society with affluence both in matter and mind.” With some Group businesses still underperforming, we believed our first step should be to set aside a period of time to concentrate on building a foundation for medium- to long-term growth rather than chase after temporary profits. It is clear that we are making progress.
A good example is the Tsuruga Plant of Panasonic Automotive Systems Co., Ltd. where they have achieved remarkable results—reducing both production lead times and safety stock by 50 percent compared to October 2021. The number of locations showing positive results has increased from one to several at each operating company. Now we need to expand these initiatives to all locations.
Meanwhile, we are implementing Panasonic Transformation (PX) initiatives that will channel the power of digital to improve the speed and quality of management and change the way we work and do business.
As testament to our progress, I’ve been receiving more comments from outside the company saying that “the Panasonic Group is changing.” The details may vary, but what I’m hearing is “you’ve become more considerate of our needs.” The entire Group is gradually changing its mindset to a long-term perspective, and people outside the company noticing this change is a clear sign that frontline employees are also changing.
The Group’s vision is to accelerate the transformation of all businesses up to 2030 so that they can contribute to solving global environmental problems and to the lifelong health, safety, and comfort of each customer. In the current fiscal year, we will shift gear from focusing on enhancing competitiveness to entering a growth phase, and we will promote this by mobilizing the collective strength of the Group—with the customer as the starting point.
Panasonic is addressing global environmental issues while leading industry discussions to establish a new indicator—Avoided Emissions. Can you tell us about these efforts?
In 1932, Konosuke Matsushita announced his 250-year plan to realize an ideal society. In April 2022, we announced Panasonic GREEN IMPACT (PGI), a long-term environmental vision for reducing CO2 emissions by more than 300 million tons by 2050, or about one percent of the world’s current total CO2 emissions. In July the same year, we unveiled the three-year environmental action plan GREEN IMPACT PLAN 2024, which runs through FY2025 and sets specific numerical targets for FY2031 of net zero CO2 emissions at all operating companies and Avoided Emissions of approximately 100 million tons. Steady progress is being made, with 28 out of our FY2025 target of 37 facilities having already achieved zero CO2 status.
The significance of CO2 emissions as a management indicator is increasing every year. Now that it is becoming a condition of trade among B2B customers, we’re convinced that emission reduction can be a competitive factor. But to accelerate this trend, we need to establish indicators that can objectively determine how much a company is contributing to reducing CO2 emissions.
The World Business Council for Sustainable Development (WBCSD) defines CO2 Avoided Emissions as the difference between the CO2 emitted from the continued use of existing products and services and those resulting from the introduction of efficient new products and services. However, this definition is not standardized internationally, and some industries are not clearly measured, so it is not widely used.
We have been leading discussions by stressing the importance of using Avoided Emissions as an indicator for companies, while keeping pace with leading international organizations such as the WBCSD and the GX League and with government policies. The electronics industry is working on standardization at the IEC. If Avoided Emissions becomes an objective and clear indicator for measuring contributions to the global environment, then it should be promoted as an important management indicator across society, including capital markets, to accelerate global level CO2 reduction.
At the Japan Pavilion at COP27, a Ministry of Economy, Trade and Industry (METI) panel discussion agreed that “indexing and international standardization of CO2 Avoided Emissions is important for economic development and a decarbonized society,” and in March this year the WBCSD and GX League established guidance for Avoided Emissions. The outcome document at May’s G7 Hiroshima Summit clearly states that “we will encourage and promote private sector initiatives to encourage innovation that contributes to emission reductions of other businesses through decarbonization solutions.” These are major accomplishments.
These activities are necessary not only for Panasonic Group, but also for global and diverse industries and companies seeking to proactively accelerate solutions to global environmental problems, and we will continue to promote recognition of CO2 Avoided Emissions.
Panasonic Group Strategy Briefing (May 2023)
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