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The Essence of Sustainability Management in an Era of Rapid Change
Note:The following dialogue was held on March, 2025.
The NEC Sustainability Advisory Committee, which started in 2022, holds regular dialogues with outside experts with the aim of confirming the direction of the Company's sustainability management and improving its initiatives.
This seventh session focused on two themes: identifying high-priority sustainability-related risks for our company and developing management strategies to turn sustainability into opportunities. NEC’s CFO and director in charge of sustainability promotion Osamu Fujikawa, CRO (Chief Risk Officer) Koji Tamefusa, and Head of Corporate Planning & Sustainability Promotion Hiroto Sugahara engaged in dialogue with the experts.
Changes in the Sustainability Landscape
At the beginning, Fujikawa asked the experts for their views on the shifting global trends surrounding sustainability.
Chairman Pedersen stated, “Companies should not be swayed by populism but should act based on scientific data, doing what they inherently should and want to do.” Mr. Horii and Ms. Nagai advised, “If we only look at the surface of the recent anti-ESG trend, we risk misjudging the reality. It is crucial to address risks by confirming stakeholder reactions in each region where we operate our business.”
To transform our own initiatives into business opportunities
Starting from April 2025, we will integrate the department that has promoted environmental initiatives within the company into our business division. We will establish the ‘Client Zero’ model where we eliminate our own risks while simultaneously becoming the first customer to accumulate know-how and deliver value to our customers. This is to transform our efforts, which were previously focused on strengthening our foundation, into initiatives that achieve growth while simultaneously fortifying our foundation.
Regarding this Client Zero strategy, Mr. Pedersen commented: "With materiality existing in both foundation and growth, advancing the sophistication of value offered can flow both ways—from foundation to growth and from growth to foundation. However, to increase the certainty of converting opportunities for NEC, it is crucial to backcast from areas facing medium-to-long-term bottlenecks in society. Regardless of political movements, focusing on population growth and technological advancement should lead to significant opportunities. Mr. Horii also proposed, ”When exploring business opportunities through backcasting, it would be beneficial to consider diversity, such as including younger generations in the review team."
Toward Practicing Essential Sustainability Management
Finally, Fujikawa concluded, " While mandatory disclosure of ESG information is advancing, we are facing rapid changes such as the rise of the anti-ESG movement. I had felt the significance of pursuing sustainability was becoming ambiguous due to being overly constrained by existing frameworks. However, I was able to reaffirm that the essence of sustainability lies in NEC growing by confronting social issues and contributing to society through that growth. We will implement the insights and realizations we gained to enhance our future management strategies. "
(Front row, left to right) Nagai, Pedersen, and Horii.