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About Panasonic

Discussion

Product quality is the lifeblood of Panasonic as a manufacturer. We must do everything to safeguard it.

What does society demand of companies today in terms of CSR?

Moderator: As corporate activities become increasingly global and people's values diversify, what do you think stakeholders are expecting companies to do in order to fulfill their corporate responsibility?

Fukushima: I think that there are two fundamental and essential elements to CSR. First, companies need to build a relationship of trust with society, and especially with customers. This means being truthful and sincere. If a company fails to do these things, then you probably do not want to continue dealing with the company any longer - just as you would feel if the same thing happened in a personal relationship. In this sense, it worries me that when a problem happens or inconvenient news is reported, many companies still try to deal with it internally and cover it up.

Secondly, we want companies to simply carry out what they are supposed to do in an appropriate manner. For example, it is most important for manufacturing companies to secure product safety, whereas hygiene management should be given top priority by food companies. I believe that what is basically required in CSR activities is that companies should faithfully carry out what they are supposed to do.

Ohtsubo: As you have just said, building a relationship of trust with customers is a core aspect of CSR. For many years - and long before the word "CSR" became commonly used - our actions have been guided by our management philosophy, which views the company as a "public entity of society."

Our founder's key insight was that companies do not operate separately from society, but rather are a part of it. Once we start viewing the company as separate from the rest of society, we end up adopting a passive stance, thinking that it is simply all right to follow the rules established in society. But when we regard the company as a member of society, we begin thinking naturally in terms of what is right or best for society. Internally we convey the importance of this way of thinking by talking about "corporate conscience" as key words on various occasions.
In our new mid-term management plan starting in fiscal 2008, the overall objective is growth, and we have set a number of numerical performance targets. It goes without saying that we must make every effort to attain these numerical goals. At the same time, however, I believe that we need to adopt a self-questioning attitude to make sure that we fulfill our responsibilities as a corporate citizen.

Fukushima: I think that an important part of CSR is that corporate leaders constantly express these kinds of inspirational views so that the organization shares a common perspective.

Fumio Ohtsubo President, Matsushita Electric Industrial Co., Ltd. Appointed President in June 2006. Starting his career in the Production Technology Division for Audio Products, he assumed several positions including Managing Director of a Manufacturing Subsidiary in Singapore, Director of the Audio Division, and President of Panasonic AVC Networks Company.

The Panasonic management philosophy and CSR management

Moderator: Since your appointment as president in June 2006, you have taken every possible opportunity to talk about Panasonic as a "Manufacturing-oriented Company." What does this mean for CSR management?

Ohtsubo: Please note that a "Manufacturing-oriented Company" does not mean that we are only focusing on actual production activity. It involves the entire process of development, engineering design, production, material procurement, quality assurance and after-sales services. Only when we integrate all these processes effectively and efficiently, will we be able to carry out our corporate mission. I want Panasonic to be a company which will be able to carry out this mission without fail, thereby continuing to make steady progress. I believe that this is a message that we must keep on communicating, both through our words and actions.

Fukushima: I think that President Ohtsubo's comments take on greater importance in these times when the operations of many companies are becoming increasingly global. I'm sure that it must be extremely difficult to imbue a common CSR-oriented stance in every employee within a global organization in a way that can transcend national and cultural borders. But I also believe that is what companies must do.

Ohtsubo: Today, what we are beginning to understand is that home appliances are being used for much longer periods than we ever imagined. So we have to study product development in view of the fact that consumers use products for a lot longer than we thought until recently, as well as methods of final disposal. I think that, in this regard, we have to fully grasp what is really happening globally, including environmental impact, and take appropriate actions. However, I understand that this issue is not something that Panasonic can solve alone. I think it is important for us to work with component manufacturers and other suppliers to share common targets and values so that we can work together to achieve our goals.

The product-related responsibilities of a manufacturer

Moderator: Recently our attention has been drawn to various incidents in Japan where problems with products and services have betrayed the trust of customers. Regrettably such incidents have also involved Panasonic products. What are your thoughts on this, and what do you think customers should expect and demand from manufacturers?

Fukushima: In Panasonic's case there have been tragic accidents involving FF-type kerosene heaters. But as a company you have not concealed any information. You have disclosed all the facts, and you are also making every possible effort to ensure that the very last unit is recalled. These incidents have really brought home to me again the heavy responsibility manufacturers have in terms of product safety. When a company is faced with a problem, rather than avoiding dealing with the issue, they have to understand the situation from the position of customers. This is the touchstone proving that a company puts its relationship of trust with consumers above anything else.

Ohtsubo: In the case of these FF-type kerosene heaters, this is something that should never have happened. We make every effort to develop and produce products that do not have any flaws, but sometimes things happen that you simply cannot foresee. When this occurs, the obvious thing for us to do as a company is to immediately notify the public of what has happened, without concealing anything. It is also vital for us to take immediate action. Always bearing this unfortunate incident in mind, we are determined to continue taking necessary measures to make sure that such problems never occur again.

Fukushima: What is noticeable in many of these cases of corporate wrongdoing in Japan is that the more damaging the case becomes, the less frequently the relevant information tends to be reported as far as senior management. To me this highlights the fact that practicing CSR management is very much about cultivating corporate culture and developing internal systems to ensure that this sort of information is communicated quickly up through the organization.

Ohtsubo: I agree. As you say, it is absolutely vital that bad news is communicated to the top of the company quickly. At the same time, I always bear in mind the importance of practicing our frontline-oriented principle in our daily activities based upon "actual place and actual thing." For instance, whenever a problem arises, I believe that it is important for those in charge to examine the actual situation with their own eyes. Now, whenever there is a product quality issue, the senior managers of business domain companies discuss the issue by examining actual products where possible. So, if a problem occurs with product A, we immediately start considering the possibility that a similar problem may happen to product B, or product X produced at a different manufacturing site. This approach encourages sharing of information within the company. I believe that instilling this kind of approach is one of the keys to cultivating strong and effective CSR management.

Towards achieving an optimum work-life balance

Atsuko Fukushima Newscaster, essayist With her extensive experience as a journalist covering companies and businesspeople, Ms. Fukushima is a regular public speaker and is actively involved in forums on issues affecting modern society, such as communications, the environment, regional redevelopment, and agriculture.

Moderator: Work-life balance refers to harmonizing the relationship between work and personal or family life. With many people adopting different and varied attitudes toward work, how do you think companies should help?

Fukushima: People are consumers before they are employees of a company. For a company like Panasonic whose products are so much a part of consumer lifestyles, I think that helping employees to lead fuller personal lives would boost motivation at work and foster greater creativity in terms of developing products that will in turn enrich the lives of consumers. In this age of greater diversity, in extreme terms, virtually everybody wants something different. A global company like Panasonic attracts diverse people in terms of age, gender, nationality, culture and religion. By providing working conditions and styles that get the most out of diversity and individual differences, I think that Panasonic can develop a stronger organization.

Ohtsubo: Today, global competition between companies is developing dynamically at an ever-faster pace. Companies must evolve by improving the way they do business, and I think that we are now seeing competition develop in terms of the speed with which companies can evolve. And the competitiveness of companies depends on the growth of their employees as members of society. Panasonic has personnel systems as part of its corporate culture that allow all employees to identify how they want to achieve self-fulfillment and set clear targets.

Furthermore, I think that the critical issue today is not how to get people with individual personalities to assimilate into the company, but rather to develop ways to enable people with a wide variety of skills, talents and values to mingle productively within the same organization. Increased diversity is bound to cause more friction to some extent. But friction can also be a force that helps the organization to grow. For Panasonic, I believe that it can be a major source of competitiveness. We also want to maintain transparency in our operations through open communication and an open corporate culture, while ensuring that everyone appreciates the importance of achieving an optimum work-life balance.

Moderator: Takumi Kajisha Executive Officer, Matsushita Electric Industrial Co., Ltd. In charge of CSR Office

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