Despite our poor operating performance, in fiscal 2022 we achieved some degree of success in building a foundation for long-term value creation. Specifically, we proceeded with the four medium-term management issues articulated in Medium-term Direction 2024, specifically the first phase of Vision 2030, which includes management transformation, higher-level portfolio management, formation of a lean management base, and preparation for 2030.
Regarding management transformation, to firmly establish hypothesis-based thinking in the business management process, we integrated our single-year budget with our medium-term plan and added the data to the numerical targets as monitoring indicators. We clearly defined the hypotheses on which these targets are based and verified them every quarter, laying a foundation for promptly responding to changes in our environment. In addition to joining the Responsible Business Alliance (RBA) (see page 29) and establishing a Human Rights Committee within the CSR Management Committee, we introduced a sustainability investment promotion system to achieve sustainable growth. This system consists of two measures. The first is a mechanism for encouraging investment that involves the relaxation of rules on determining investment recoup periods and establishing special quotas. The second is the application of an Internal Carbon Pricing (ICP) system, characterized by the recognition of amounts of GHG emissions as expenses in management accounting.
For higher-level portfolio management, we strive to create value by practicing 3-layer portfolio management and positioning four business markets as key business opportunities.
Regarding the former, we moved forward with integrating Resonant and Eta Wireless, which we acquired in fiscal 2021, to strengthen differentiated technologies in the second-layer businesses. Regarding the latter, in the mobility area, one of our core fields, we worked to build our presence by aggressively increasing capacitor production capacity and launching products such as new inductors. In our challenge fields, we pressed ahead with the deployment of proprietary energy management systems at our own factories. Also, we invested in an environmental fund to create essential new businesses for the next generation.
Concerning the formation of a lean management base, we endeavored to strengthen our human capital and upgrade our risk management process. In terms of human capital, in addition to developing the next generation of corporate executives, we also launched “Make2030,” a program designed to nurture the next generation of leaders who are our path forward. In this way, we are putting together a structure whereby talent in a wide range of age groups can work with the current executives to address long-term management issues. In addition, we have focused on risk management in recent years, leveraging the insights of our Outside Directors to develop a risk management structure that contributes to our value-creation process. For example, in April 2023, we put the Risk Management Committee, which had previously been under the jurisdiction of the CSR Management Committee, under the direct control of the Representative Director, to emphasize that risk management is our highest priority. Under the new structure, we expanded the scope of risk management to encompass business opportunities. We will also aim to enhance the sophistication of our risk management further while linking it with the change-responsive management theme based on hypothetical thinking.
Preparation for 2030 refers to activities that assess business management-related risks and opportunities and translate the necessary preparations into concrete actions. In addition to discovering and nurturing technologies that can be a source of future competitiveness and formulating and implementing intellectual property strategies to support these, we are connecting our global network to address possible future threats and moving forward with scenario planning to manage risks.