Omron 1999 Annual Report Download - page 4

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OMRON’SCORPORATE GOVERNANCE
OMRON Corporation changed the nature of its corporate
ideals in May 1998. Aiming at setting its corporate gover-
nance in place for the years ahead, OMRON will optimize its
management philosophies to respond to the challenges occurring
in the social and business environments now and in the future.
The six management philosophies we are focusing on to
make our corporate motto of “At work for a better life, a better
world for all” a reality are as follows:
• Offer maximum satisfaction to customers
• Consistently accept challenges
• Focus on gaining shareholders’ trust
• Respect individuals
• Become a responsible corporate citizen
• Maintain corporate ethics while promoting
corporate activities
To obtain shareholders’ trust and respond to shareholders’
expectations, we must
• improve corporate values,
• appropriately distribute corporate profits to share-
holders’, and
• disclose management data and achieve transparency
(accountability).
As part of concrete measures undertaken in fiscal 1999,
ended March 31, 1999, OMRON initiated a share buyback pro-
gram and retired five million shares and introduced a stock
option plan for its directors to encourage them to keep growth
in investors’ value as their chief management goal.
BUSINESS PERFORMANCE IN FISCAL 1999
OMRON recorded an unfavorable performance in fiscal
1999, as did many other Japanese companies. Con-
solidated net sales decreased 9.2%, to ¥555,280 million. This
slump is mainly because domestic sales by the Control Com-
ponents and Systems Division, our core business division,
drastically dropped 21.5% from the previous fiscal year due to
a cooling down of the economic environment for domestic
investment in equipment. The division’s domestic sales ac-
counted for nearly half of total sales. Overseas, stalled Asian
economies, a deceleration of European economies from the
second half of the term due to depressed exports, and a drop
in customers’ capital investment in the United States affected
the division’s sales achievement.
Operating income plummeted 74.3% from the previous fiscal
year, to ¥11,849 million, primarily as a result of the sales decrease
in the Control Components and Systems Division, which is tra-
ditionally the most profitable business unit in OMRON.
TO OUR SHAREHOLDERS
2
Yoshio Tateisi
Representative Director and Chief Executive Officer