Strategy

Provide Integrated Solutions to address diversifying social challenges, in the four fields of Life, Industry, Infrastructure and Mobility, uniting all the capabilities inside and outside of the Group. For this purpose, we will enhance our business foundation fostered over the past 100 years^*1 and further transform business models.

• *1 connection with customers, technologies, personnel, products, corporate culture, etc.

Integrated Solutions

The Mitsubishi Electric Group's Integrated Solutions are offerings that only we can provide, and we do so by combining our strong core components with a wealth of Field Knowledge and advanced digital technologies.

Based on its strategy, Mitsubishi Electric Group will pursue value creation for addressing social challenges, and contribute to achieving the 17 goals of the SDGs^*3, through all corporate activities. With a view to realize a vibrant and sustainable society, we have set priority items in our sustainability initiatives as materiality. We will actively disclose information on the status of materiality efforts and promote engagement with stakeholders.

• *3 "Sustainable Development Goals" adopted by the United Nations as goals to achieve towards 2030

The Mitsubishi Electric Group’s Materiality

Medium-term Management Plan Towards FY2026

Financial Targets

The Mitsubishi Electric Group aims to achieve revenue of 5 trillion yen and an operating profit margin of 10% by fiscal 2026. We also aim for an ROE of 10%, as well as to generate cash of 3.4 trillion yen over the five-year medium-term management plan period.

Strengthening of Business Portfolio Strategy

To achieve sustainable growth, the Mitsubishi Electric Group will categorize its businesses based on their characteristics and invest management resources with priority placed on focus areas, thereby strengthening its business portfolio strategy and improving profitability. We will strategically invest our management resources into five Key Growth Businesses: Factory Automation (FA) Control Systems Business, Air Conditioning & Refrigeration Systems Business, Building Systems Business, Automotive Equipment Business (xEV/ADAS^*5), and Power Semiconductor Devices Business. In this way, we will shift resources to highly profitable businesses with strong growth. We will also engage in initiatives with development businesses and new areas of business, expanding our solutions business with data integration and utilization and transforming the business model in our existing businesses to create next-generation businesses.

Expansion of Integrated Solutions

By promoting digital transformation throughout our businesses, we will coordinate and analyze data from our equipment and systems to offer optimal solutions that suit the needs of our customers. We will also expand our solution business in collaboration with our customers and through actively pursuing M&A.

Enhancement of Business Foundation

1. Operation DX

In April 2021, Process & Operation Re-engineering Group has been established. It serves at the core of operations to optimize the Mitsubishi Electric Group as a whole by revamping operational processes, and promoting Operation DX through streamlining operations and improving productivity utilizing data and digital technologies.

2. Global Response

Strengthen supply and engineering chains globally. Quickly detect and analyze changes in the global political and economic environment in order to respond with agility.

3. Optimal Group Management System

Pursue an optimal group management system by strengthening the functions and reviewing the division of roles of affiliated companies in each value chain.

4. R&D Strategy

Pursue the enhancement and reform of existing businesses as well as R&D for new value creation in a balanced manner. Aim to address social challenges at an early stage through the active use of open innovation.

5. Intellectual Property/Standardization Strategy

Focus on acquiring intellectual property rights related to AI and solutions that contribute to Business DX, and expand our business through stronger external collaboration based on our technological assets. In addition, promote a trinity management that aligns business strategy, R&D strategy, intellectual property/standardization strategy for addressing social challenges and expanding our businesses.

Sustainability Initiatives

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1. Initiative to Realize a Decarbonized Society

In June 2019 we announced Environmental Sustainability Vision 2050^*8, proclaiming that we will aim to reduce greenhouse gas emissions from our entire value chain by more than 80%. However, given the acceleration of efforts toward a decarbonized society, we have reviewed the target, and we will further strengthen our endeavors to reduce greenhouse gas emissions. We aim to achieve net-zero emissions across the entire value chain by 2050.

• *8 Positions environmental protection as an even greater corporate priority and stipulates increased initiatives to be taken by the Mitsubishi Electric group.

1. *9 Compared to 2013.
2. *10 Achieve net-zero emission by increasing the proportion of contribution from improvement of efficiency and spread of Power Semiconductor Devices, etc. in reducing greenhouse gas emissions to a scale that outweighs the reduction in CO₂ emissions.
3. Note: In this chart, the accounting period of the fiscal year ending March 31, 2020 is referred as FY2019. Any other fiscal years would be referred similarly.

2. Employee Engagement

Taking recent work-related issues seriously and making the prevention of recurring work-related issues key management priorities, the Mitsubishi Electric Group is promoting our Workplace Culture Innovation Program. With third-party verification by external experts, this program is creating a workplace where all employees cooperate to maintain sound mental and physical health and work with peace of mind.

3. Human Rights and Diversity

With respect for human rights based on international regulations serving as a foundation, the Mitsubishi Electric Group will conduct human rights impact assessments, improve our response at contact points that receive complaints and consultations related to human rights, and strive to grasp and correct human rights violation risks in our supply chain right across the organization.
To promote diversity, we will strengthen activities aimed at creating workplaces where individuals can maximize their talents, such as by increasing the ratio of female managers, driving co-creation by fostering an understanding of LGBTQ ^*11 people and hiring a larger number of people with disabilities, as well as actively promoting local staff to managerial positions at overseas bases.

• *11 Lesbian, Gay, Bisexual, Transgender, Queer(Questioning)

4. Information Security, and Product and Service Quality

Based on past incidents of unauthorized access, we will reinforce our information security infrastructure and strengthen measures against the latest attack patterns, which are becoming increasingly sophisticated and elaborate.
To prevent the recurrence of improper conduct in quality control, we will strengthen education to achieve a fundamental improvement in awareness and structures, and we will strengthen our quality control system so that our products and services conform with relevant laws, regulations and standards.