The Need to Raise Awareness in Japanese Society

The global community is faced with a number of major issues today. The industrial society that flourished in the 20th century can no longer maintain proper balance in today's global society and economic environment. Global warming is becoming increasingly serious. In Japan, many people think that reducing CO₂ emissions will help to mitigate global warming. In other parts of the world, however, people have begun to examine what can be done to minimize the damage that the phenomenon has already caused. If everyone in the world tried to live a lifestyle on the same economic level as the Japanese, we would need two or three planet Earths. While 920 million people are starving in the world, Japan discards around 20 million tons of food per year. As humankind achieves the highest levels of power ever, some people are still deprived of the benefits of modern medicine and technology.

We Should Not Be Seeking Only Our Own Profits

So was the business structure for the 20th century wrong? In hindsight, I might say that economic activities in the 20th century were short-sighted and exclusionary -- in other words, businesspeople were only looking out for their own profits. I think people in those years thought that environmental destruction was an inevitable sacrifice for market growth. In that sense, the financial crisis triggered by the subprime loan problems in 2007 may have been an opportune chance for people to think more deeply about the economy.

When the member countries were not able to reach an agreement at COP15, which was held in 2009, it might have made some people think that the world had lost its enthusiasm for preventing global warming. However, that wasn't the case. In reality, efforts to prevent global warming are moving forward on both state and corporate levels. For example, the United States is providing financial support to private companies in an effort to become the world's leader in the field of clean energy. For instance, a solar panel manufacturer received a US government guarantee for a bank loan of some ¥50 billion to construct a plant. As a result, the manufacturer will eventually acquire a production capacity equivalent to 500,000 kilowatts. China continued to say "no" at COP15, but the nation is now promoting a shift to Green Industry through environmental innovation. In a five-year plan that will be launched next year, China intends to use three trillion yuan from government funds, which is more than 40 trillion yen. Korea and the EU also have their own policy visions. When a country or region announces a vision for the future, it makes it easier for the companies in that country or region to make long-term investments. I think every business community should ask its government to present a vision that shows which direction the country or region is heading.

An Era of Investment in Sustainable Economic Activities

A variety of changes have come to both investments and finances. We have entered an era of Green Finance. Business notions such as investors purchasing stocks in anticipation of a price rise in a few months, and financial organizations lending money because of their long-standing relationships with customers are things of the past. Now, they think of how the money lent or invested will be used, what kind of impact it will have on the society or the environment, and what it can do for future generations. Investment with due consideration to the environment and governance began around 2006. At the present, more than 800 institutional investors and other organizations are listed as signatories to the Principles for Responsible Investment, and are conducting activities accordingly. A growing number of investors are also investing in companies that address the creation of sustainable societies in anticipation of future business growth. One investment fund manages ¥800 billion based on this principle.

New Energy Investments Exceed Those for Fossil Fuels

Funds injected into the clean energy field have been dramatically increasing worldwide. They totaled US$173 billion in 2008 and US$162 billion last year. China ranks clearly at the top with US$34.6 billion, followed by the U.S. with US$18.6 billion in second place, the UK in third place, and then Spain, Brazil and Germany in that order. Japan is not even on the list. In 2008, investments in power generation facilities using new energy sources exceeded those for fossil fuels. While US$110 billion was spent for fossil fuels, US$140 billion went to new energy. We are already in an era in which industries are created in response to environmental concerns.

Players Change in the Solar Cell Market

The expanding Green Industry is also affecting investment in solar cells. In 2005, Sharp Electronics Corporation was No. 1 in terms of solar cell production volume, and most of the top-ranking companies were Japanese. However, the top-ranking companies in 2010 are Chinese and US. Even in Texas, USA, where the oil industry is big business, there is a shift from petroleum to wind power generation. The UK established a new Department of Energy and Climate Change in 2008. It's the equivalent of Japan's Agency for Natural Resources and Energy, which is under the Ministry of Economy, Trade and Industry; and the Global Environment Bureau, which is under the Ministry of Environment, put together. In other words, the UK believes that climate change and energy issues must be addressed together. The world is indeed moving dynamically.

The Demands for Business Management in the 21st Century

The primary mission of a company is no longer to simply ensure its own prosperity. Companies must take part in solving social problems through their business activities. Management must consider the environment, society and governance comprehensively. These efforts will then be evaluated by society and serve as forms of social communication. Panasonic's Green Plan 2018 places the environment at the center of all its business activities as the company strives for continuous Green Innovation. Panasonic pays close attention to the social impact of its business, while also seeking profitability. It is still a plan at this stage, and we are all interested to find out how well the plan will be implemented. New values are being incorporated into the judgment criteria of consumers, governments, bank loan officers and investors. We all should examine how we can help to create sustainable societies for the new era.