Fujikura co. LTD

Fujikura co. LTD

Introduction

Fujikura co. LTD is a Tokyo electric equipment manufacturing company, which produces and develops telecommunication, such as optical fiber cable, electrical wire, and cables(Fujikura ESG report,2019).

Integrated thinking is when all forms of capital are actively considered (financial capital manufactured, intellectual, human, natural, social, and relationship), which allow organizational inputs to be processed and transformed as outputs and outcomes. (IIRC, 2013, p. 7) Knauer and Serafeim (2014) believe that integrated thinking helps in the achievement of “sustainable profitability.” An organization has the means and power to make explicit efforts to develop integrated thinking and embed sustainability in the business model of the company.

Criticize Real report

Fujikura is a global organization because it is on the Tokyo Stock Exchange. This entity is a business; according to IFRS 3, it must include input, process, and output. According to the Fujikura Co. environmental, social governance (ESG) report, updated information involves copper, polyethylene, and aluminum are used to manufacture products. Leads to cash flows, greenhouse gas, and waste chemical substances are also generated simultaneously. Therefore, the Fujikura group has a corporate social responsibility to be operating environmentally friendly to meet the Sustainable Development Goals (SDGs) of the society globally.

The mid-term target of 2020, is CO2 emissions reduction, save water, and protect biodiversity, which is CSR priority measures. To meet those targets, the Fujikura group introduces the ECO-PASS environmental information collection system to share and analyze data, resulting in visualizing ecological performance to improve the efficiency of environmental data collection. Besides, they focus on educating people, such as employees, management, and internal environmental auditor on the requirements of the ISO14001 environmental management system. Furthermore, employees also participate actively in energy-saving and recycling activities and also raise awareness through ecological lectures.

The 2018 financial year results, in the aspect of CO2 emissions reduction, it met half of its target. It also achieved two goals of better biodiversity conservation and green products. However, they didnt achieve a water-saving objective due to the excessive use of water.

Fujikura co has invested 2014.9 million yen and costs 4211.2 million yen in April 2018 to March 2019 to prevent pollutions, such as training fees, developing R&D of environmentally friendly products, etc. Those investments bring effects, which is 646.8 million yen. Although these costs exceed benefits, as a global scale, the large organization should in compliance with law and regulation to operate and contribute to the local community. The best performance is the entity focus on protecting biodiversity because they are aware of the close relationship between business activities and the natural environment. Another best point is that they set higher voluntary standards, which exceed laws and regulations to respond to the challenge of climate change actively. Although they are not achieved all of the goals due to operational efficiency of employee and factory usage, etc., they show the details of CO2 emission of the entire supply chain; we can observe trends and proportions of all categories.

Fujikura focuses on integrated thinking because they have a long-term target in 2050, identifying four central challenges of the goal, which is the strategic focus and future orientation. They also invest capital and then transform them into the ECO-Pass system and educate people aware of environmental protection. Finally, the generated outcome of the environment that the majority contribution is the reduction of CO2 emissions, which is benefits our next generation because it takes into account key stakeholders’ legitimate needs and interests and develops human capital in partnership with others. As a result, the company’s reputation has grown, and profitability has increased. Money can be reinvested in the enterprise, which can operate for a long time without harming human beings’ habitat, thus maintaining the stability of the global economy.

Fujikura Group introduces the 2030 vision in 2017, which is solves problems in a comfortable and sustainable “Mirai”( the Japanese word meaning “Future”) society through providing “Tsunagu” solutions and enhances the corporate value. “Tsunagu” solutions refer to solve social problems connect people, things, and stories, which involves that technology, brand, human resources, culture, and health management. It means that embed sustainability in the business model of Fujikura Group.

To the social aspect, the Fujikura group pays attention to consumer issues, including quality policy and quality assurance systems. This system optimized based on the ISO 9001 standards, for example, regular meetings, reports, and communication immediately and communicating. Regarding the complaints of quality, management use KPI to measure product quality. For quality management, Fujikura Co. introduces a personnel training plan to educate all young technicians of their first year. They also focus on the safety and health of all employees, publishing safety pledge in April 2016 because of a fatal accident occurred domestic affiliate company. Although they post their safety pledge to promise everything, some accidents may not be avoided or prevented. It seems like an empty promise. However, the good performance is that mock disaster drills, which respond to earthquakes, and have response policies.

Fujikura Co. also develops a policy of human rights to protect all of the employees. Besides, they meet the need for accountability because of disclosure actively. This company builds a corporate culture to establish a system through consider its employees proactively, resulting in increasing customer value and fulfill social responsibilities. Furthermore, the company in compliance with corporate ethics rules, such as labor laws that pay wages, allowance, and pensions, do not employ child labor and prohibit human trafficking. What’s done well is to hire employees of different nationalities, increase the proportion of female employees, improve the diversity of employees and emphasize the important role of women in the enterprise. Also, the company has employed more disabled people, who can earn their living by working in enterprises, thus reducing the unemployment rate and reducing the financial burden on society.

From the foundation in 1885 to today, they inject ” we value our customers and live with society,” to the heart of employee. They also made a lot of contributions to society, nine things happened between 1916 and 2020, which involved five main characters in the enterprise, who made contributions to society. A scholarship system was established to support Myanmar’s development. Donating healthy lunches to developing countries. These events appear to be real rather than promotional for the company, as real photos are posted on the official website of Fujikura Co.

All of the above can be reflected integrate thinking because the group pay salaries and pension etc.to their employee and respect them. Employees can work in the group comfortably and happily. These social benefits will transform into human capital because this company has good reputation, resulting in many skills and talent people to join them. And then, good human capital will transform into intellectual capital. Finally, Fujikura Co will become more competitive advantage. Next, they will have an incentive toward hard through communication and coordination proactively. Every employee can make the most of his or her role within the organization, insisting to contribute to the society and full awareness of mission ‘live with society’. Management actively implements consumer issues, human rights, and diversity of the nation of the employee, etc. result in increase customer and fulfill their social responsibility. And then, key stakeholders’ legitimate needs and interests are concerned. This cause-effect is a connectivity of information, which is a combination, interrelatedness, and dependencies between the factors the affect the ability to create value over time.

The economic aspect should not focus on the past financial data to measure whether it is bringing profit to the entity. More attention should be paid to the plan of long-term strategy issued by management because it relates to an organization’s ability to create value in the short, medium and long-term and how it affects the capitals. They published three plans, 2020 mid-term management plan, 2030 vision and environment long-term vision 2050, which is a short-term, medium and long-term strategy. The short-term goal is profitability and revitalization. At the same time, it has strengthened environmental, social and governance to strive to achieve sustained growth and corporate value enhancement. Fujikura’s business plan uses the pyramid model is the bottom-up day-to-day operation to the top that achieves a goal.2050 long-term vision link to the environment, it has detail formal plan, action guidelines, and clear process and identifies four main challenges for 2050. This plan takes into account the habitat of future generations. As long as human beings can continue to survive and the global society and economy remain stable, corporate can continue to operate and generate profits under such a favorable environment. But the plan seems to have an unrealistic idea, the first main challenge is zero CO2 emissions of factories, it seems impossible to achieve unless scientist has a new invention. But there are may no discovery yet, that could solve the problem of global warming.

Conclusion

In conclusion, integrated thinking is different from traditional business decision-making, which is focused on short-term financial outcomes. (Integrated Thinking. 2017) Integrated thinking combine with best practices, it also can help frame reporting to the board and improve the quality of decision making. Better integrated thinking and decision making provide a thorough understanding of the business model, resulting in good governance and performance management and better reporting, which means that, better business. CGMA holders encourage deep consideration of the process of reporting not just to report itself. Integrated thinking support business decision making not only to have a better competitive advantage but also to contribute whole world society stability, economic and sustainable development.

Reference:

Knauer, A. and Serafeim, G. (2014), “Attracting long-term investors through integrated thinking and reporting: a clinical study of a Biopharmaceutical company”, Journal of Applied Corporate Finance, Vol. 26 No. 2, pp. 57-64.

Fujikura. Ltd ESG Report. Undated [online] Available at: <https://www.fujikura.co.jp/eng/esg/index.html> [Accessed 15 March 2020].

Integrated Reporting Framework. 2013.  [ebook] International Integrated Reporting Council. Available at:<https://integratedreporting.org/wp-content/uploads/2013/12/13-12-08-THE-INTERNATIONAL-IR-FRAMEWORK-2-1.pdf> [Accessed 14 March 2020].

Integrated Thinking. 2017. [ebook] CIMA Global Academic Research Program

Available at: <https://www.cimaglobal.com/Documents/Research%20and%20Insight/Integrated%20Thinking%20Report%20vol%2013%20issue%203.pdf> [Accessed 16 March 2020].

Topazio, N., 2014. INTEGRATED THINKING. [online] Cgma.org. Available at: <https://www.cgma.org/content/dam/cgma/resources/reports/downloadabledocuments/integrated-thinking-the-next-step-in-integrated-reporting.pdf> [Accessed 18 March 2020].

Oliver, J., Vesty, G. & Brooks, A., 2016. Conceptualising integrated thinking in practice. Managerial Auditing Journal, 31(2), pp.228–248.