Pentax 2005 Annual Report Download - page 8

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I would like shareholders to communicate
their views on management to us more often.
One characteristic of the corporate governance
principles of Hoya is the fact that management oversight by
third parties is an absolutely natural element of Hoya’s
business. Since 1995, when Hoya first welcomed external
directors, the number of these outside directors has
continued to increase, while the total number of directors
has gradually decreased since 1989. Currently, of the total of
eight directors, the five outside directors are in the majority.
The three executive officers, including myself, always strive to
manage Hoya’s operations with the intensity and energy that
comes from our accountability to the oversight of the
outside directors.
Compliance
Corporate social responsibility (CSR) has become a byword
for the general public. The CSR concept implies that a
company has the responsibility to contribute, not just to its
shareholders and employees, but also to the wider society
and the environment. Hoya addresses its CSR obligations by
offering products designed to fully meet market needs, only
after they undergo a process that involves checks for strict
observation of all compliance requirements. It goes without
saying that all laws and regulations are rigorously observed,
and even where issues are not governed by written codes,
Hoya is careful to make decisions only after examining basic
expectations and social norms, and always strives to make
the appropriate ethical judgment. Toward this end, we have
introduced the Hoya Help Line, a system whereby
employees can submit internal reports or discuss issues in a
completely anonymous manner. This system puts faith in the
good sense of our employees, who can lodge complaints
about unfair or unreasonable behavior, which are conveyed
promptly to top management. The system now operates
only in Japan, but we are considering introducing it at our
overseas subsidiaries.
growing demand by developing an even stronger presence in
each market.
In the year ahead, it will be our objective to actively
expand investment in the Eye Care field. We have been
working to create a foundation for a soundly profitable
business structure, building on the work already done to
withdraw from unprofitable product lines and restructure
where necessary. Moreover, due to the growth in demand
for our products used in digital consumer electronics, the
Information Technology field is now contributing a larger
share of the Group’s overall profitability than it should. To
achieve the optimum portfolio balance, we need to devote
additional attention to the Eye Care field in the future. In
particular, we plan to prioritize the European side of this
business, where there is room for growth.
Our position on mergers and acquisitions (M&A) is one
of active pursuit and consideration of good opportunities:
we will not necessarily limit our options to our existing
business fields. Over the past several years, we have been
strengthening our financial position, and as a result our cash
holdings have become almost too large. Every business
undergoes a period of growth after its establishment, and
later moves into a period of decline toward the end of its
life cycle. We think companies that are successful in the long
term constantly seek to create or acquire new businesses, to
improve growth rates into the future. I believe that M&A is
one effective means of achieving this, and I intend to allocate
funds accordingly.
Corporate Governance
The term “corporate governance” has recently received a
great deal of attention. A number of concepts are
embedded in this phrase, and I am convinced that one of
the most important elements is how conscientiously senior
executives approach management.