MHI Publishes Integrated Report “MHI Report 2022”

Tokyo, November 30, 2022 – Mitsubishi Heavy Industries, Ltd. (MHI) today published the “MHI Report 2022.” The focus of this year’s integrated report is on MHI Group’s contributions to global Carbon Neutrality. In October 2021, MHI announced its commitment to achieve Carbon Neutrality Groupwide by 2040, and MHI Report 2022 presents detailed explanations of the efforts to fight against climate change by applying the full breadth of decarbonization technologies MHI Group has developed throughout its history.

The report opens with a message from the President and CEO Seiji Izumisawa outlining MHI Group’s value creation proposal. He introduces the standpoint behind the Company’s “MISSION NET ZERO,” its commitment to achieve net zero CO₂ emissions Groupwide by 2040, and also presents a progress report on the Company’s 2021 Medium-Term Business Plan as well as an overview of how MHI is responding to the rapid changes taking place in its business environment. This is followed by a message from Chief Financial Officer (CFO) Hisato Kozawa describing the Company’s financial strategy for enhancing corporate value. Next is a conversation between Chief Technology Officer (CTO) Eisaku Ito and Toshihiko Hashida, former Director-General of the Japan Meteorological Agency (JMA). Mr. Ito describes the role MHI Group can play toward resolving issues relating to climate change, citing the Company’s hydrogen technologies which are key to achieving a decarbonized world, especially its R&D of hydrogen gas turbines.
The MHI Report 2022 also contains a special feature on various measures being implemented by MHI Group toward realizing a carbon neutral world. With graphs and illustrations, this article offers a detailed overview of specific measures the Company is taking to achieve “MISSION NET ZERO.” Another article, contributed by Professor Nobuyuki Isagawa of the Graduate School of Management, Kyoto University, who specializes in corporate finance, addresses the relationship between Carbon Neutrality and corporate value. He describes the significance of MHI Group’s efforts in this area from the standpoint of his research into the relationship between a company’s ESG (environment, social and governance) indicators and financial performance. Concerning the Company’s business strategies, measures derived based on the latest SWOT analysis(Note1) are presented for the following business domains: Energy Systems; Plants & Infrastructure Systems; Logistics, Thermal & Drive Systems; Commercial Aviation, Integrated Defense & Space Systems.

The second half of this year’s integrated report contains explanations of the Company’s basic approach to and execution of corporate governance, its officers’ remuneration structure, the current status of its reduction in strategic shareholdings, and the major risks recognized by management and their corresponding responses. Also featured is a conversation with the Chairman of the Board Shunichi Miyanaga and two outside directors: Masako Ii and Hiroo Unoura. They discuss how Board of Directors meetings support the Company’s sustainability management and exchange views on how corporate governance is carried out at MHI, with a focus on the role of Board of Directors meetings in addressing major social issues such as Carbon Neutrality.

Other items included in MHI Report 2022 introduce the Company’s sustainability management policy and promotion system, initiatives being taken to address human rights issues, Company-wide materiality goals and KPIs to respond to the SDGs(Note2), and MHI’s response to risks and opportunities arising from climate change (disclosure in accordance with TCFD(Note3) recommendations). Presentations are also given of what the Company is doing to respond to heightened social demands pertaining to compliance and cybersecurity.

Going forward, MHI Group will continue issuing annual integrated reports outlining how the Company is contributing to resolving social issues as it simultaneously pursues sustainable business growth and ongoing enhancement of its corporate value, presented with a careful balance of financial and non-financial information and in a format enabling easy understanding by shareholders, investors and all other stakeholders.

• 1SWOT is an analysis technique employed for formulating management strategies by assessing the external and internal environments using factor analysis in four categories (strengths, weaknesses, opportunities, threats), and then determining how to optimally utilize management resources to respond to changes in the business environment.
• 2The SDGs are a set of “sustainable development goals” adopted by the United Nations General Assembly in September 2015 targeted for achievement by 2030. It consists of 17 categories incorporating a total of 169 targets.
• 3TCFD: Task Force on Climate-related Financial Disclosures.

• MHI Report (Annual Report) and Other Reports