● Circular Economy ● GHG Emissions Reduction ● Resource Utilization
Plastic use is a matter of major concern to both society and investors in terms of resource utilization and environmental pollution. I believe that R&D and product creation aimed at minimizing plastic use throughout the value chain will become key differentiators. Discussions around reducing the use of virgin materials, together with your company’s long-standing track record in recycling operations, will serve as important selling points.

● Carbon Neutrality
Why not highlight and communicate your company's strengths in energy efficiency improvements and energy conservation initiatives? At a time when energy prices remain high, providing energy-efficient products is a compelling selling point that can contribute to both addressing social issues and reducing the energy expenses for customers.

● Contribution to Water Resource Conservation and Access ● Water Use
Your company's water-saving electric appliances are highly relevant as they contribute to these areas. By reducing water consumption and contributing to water resource and environmental conservation, your company's water-saving appliances create positive environmental and social impacts that contribute to a competitive advantage, especially in water-scarce regions.

● Occupational Health and Safety ● Harassment
Occupational health and safety and harassment prevention are fundamental priorities that must be addressed in conducting corporate activities.

● Human Capital Management ● Individual Differences
Employee engagement scores, a key indicator of human capital, improve through a combination of multiple factors. In terms of workplace environment, working alongside diverse talent, including people of different ages and abilities, broadens employees’ perspectives and facilitates the exchange of diverse ideas, which in turn creates value. In particular, an environment where younger employees can participate in discussions from their second or third year promotes cultural transformation, leading to higher engagement scores and improved talent retention. In addition, understanding how the company's products contribute to society through its core business can also improve engagement scores.

●Quality
The quality incidents that came to light in 2021 gave your company an opportunity to reaffirm its responsibility as a company that provides products and solutions that benefit society. Quality includes both safety and security. By consistently ensuring safety as a fundamental requirement, you give your customers peace of mind, which in turn earns your customers’ trust in the company.

●Compliance
To maintain and improve quality, it is important to recognize again the importance of fulfilling contractual obligations. Each employee's commitment to compliance, such as carefully negotiating with customers after fully understanding and carefully reviewing the contract terms, prevents misconduct.

●Corporate Culture
It is important for employees to understand and take pride in the fact that the company’s products contribute to society. Ultimately, this fosters a corporate culture free from misconduct and drives long-term corporate value.

●Corporate Strategy
A company’s overarching direction is intrinsically manifested in its corporate philosophy and management strategy. Therefore, it is imperative that a seamless coherence exists between the upcoming revision of the medium-term management strategy and the identified materialities. As a fundamental premise, the Key Performance Indicators (KPIs) established for these materialities must be rigorously aligned with both our overarching business and human capital strategies.

●Corporate Governance
Corporate governance should not be implemented merely as a utilitarian tool to secure an advantageous position in capital financing; rather, it is a structural mechanism designed to evaluate how such implementation organically transforms management practices themselves. If specific challenges emerge during the effectiveness evaluation of the Board of Directors—the very core of this governance structure—those profound issues can arguably be defined as the essential materialities for your company.

If we consider that one of the purposes of materiality is to increase corporate value, the aim should be to demonstrate how materiality correlates with both the company's purpose and corporate value. From this perspective, narrowing the focus to the issues that are most material is a highly effective approach. To use the findings of this review to inform management decisions, it would be important to use impact accounting and the Yanagi model to demonstrate to long-term investors, a crucial audience for corporate disclosures, that these material topics tangibly drive value creation. Ultimately, this approach will strengthen external communication and clearly articulate the company's growth story.

The important thing is not simply to identify materiality issues, but to determine how they are used and what they aim to achieve. The key is to have a distinctive edge and uniqueness. To this end, the sustainability division should engage in thorough discussions with the CEO and CFO—leveraging insights from each business division—to draft an integrated corporate and sustainability strategy. For example, when considering your business portfolio, placing sustainability at the core and linking it to businesses that utilize Serendie will bring out the distinctive character of Mitsubishi Electric. Materiality issues identified in this way foster a sense of ownership among employees and drive action across business divisions, ultimately strengthening external disclosure. As this company-wide cycle is established, materiality becomes part of the company's DNA.

Aiming for perfection from the outset when identifying materiality is challenging. For a company with a highly diversified business portfolio, a viable approach is to anchor strategy on value creation through its growth strategy, using a clear timeline to differentiate the company. For example, if using the services or products provided by your company reduces GHG emissions, it contributes to climate change mitigation. Simultaneously, if this increases sales, it reflects the core concept of double materiality. With products that address climate change, your company can demonstrate significant potential for expanding revenue, margins, and operating profit through its sales plans.