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Commitment to CSR

A Message from the President

A Discussion of the Chiyoda Group’s CSR Activities
The Chiyoda Group’s Approach to CSR Is to Put Its Corporate Philosophy into Practice to Achieve a Sustainable Society

President Kubota discusses the Chiyoda Group’s corporate social responsibility (CSR) with Yoshihisa Ozasa, a corporate change consultant broadly supported by the business community.

 

Takashi Kubota 
President & CEO Chiyoda Corporation
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Yoshihisa Ozasa
President and Representative Director Link and Motivation Inc.

Putting the Corporate Philosophy into Practice Is Chiyoda’s Approach to CSR

Ozasa Chiyoda conducts CSR by putting its corporate philosophy into practice. Its initiatives have included proactive efforts to address environmental problems since the 1970s, quite some time before the term CSR came into popular use.

Kubota Chiyoda’s predecessor was the construction unit of Mitsubishi Oil Co., Ltd. (currently, JX Nippon Oil &Energy Corporation). After nearly all of the Pacific coastal oil refineries were destroyed during the Second World War, the said construction unit of Mitsubishi Oil was reorganized as an independent engineering company, namely Chiyoda, with a view to sustaining the technical resources and expertise necessary for the post-war reconstruction of Japan. When Chiyoda was established in 1948, its corporate philosophy was to serve society through technology. We contributed to the reconstruction of post-war Japan by putting our engineering capabilities to work in creating a system for the stable supply of energy.
The substantial increase in energy demand in Japan during the high-growth period from the 1960s to the early 1970s, when the shift from coal to petroleum energy accelerated, brought environmental degradation into focus. Something had to be done. Under the theme of harmonizing energy and the environment within the context of the Earth’s limited resources, Chiyoda began developing technology that contributes to society in two key areas: (1) desulfurization of petroleum products and flue-gas desulfurization for power plant boilers and other applications and (2) treatment of industrial wastewater discharged from petroleum refineries, petrochemical plants and chemical plants.

Chiyoda’s Corporate DNA

Ozasa While every company has its own unique DNA, Chiyoda’s corporate DNA has been clear since the company was established. Two factors influence corporate DNA: temporal perspective and breadth of vision. Chiyoda has shared common technological interests with its customers for decades, ranging from plant construction to maintenance. This gives Chiyoda a long-term perspective in decision-making and the will to refrain from actions that may be an advantage today but will be a problem for society in the future. Likewise, Chiyoda’s breadth of vision extends beyond energy to include the environment. Given this longterm, broad perspective in your corporate DNA, and Chiyoda’s commitment to putting its corporate philosophy into practice, you must be unaffected by all this current fuss about CSR.

Kubota Yes. Plants for natural gas and other energy resources require about 10 years to move from resource discovery to plant completion, and then operate for another 30 years or so. All together, that’s about half a century. Guaranteeing construction through to performance assurance for a certain period is vital for contributing to the economic development of resource-producing countries, so Chiyoda provides assistance at every stage from construction to operation and maintenance.

Ozasa Looking at various companies, those in businesses that end with the sale of some item tend to emphasize self-interest rather than altruism. Companies that operate in businesses requiring longstanding relationships, however, seem to gain awareness over the course of projects lasting 10, 20 or 30 years that their own benefits truly do come from helping others succeed.

Kubota In other words, win-win relationships. I would say their value is self evident. Chiyoda’s founding philosophy had three emphases: 1) cultivating people; 2) technology and trust; and 3) contributing to communities worldwide. This philosophy has not changed. We pass on a corporate culture that revolves around the utmost importance of communication in putting our philosophy into practice. We bring together a diverse array of technologies and people in long-term projects with a single goal, which makes communication absolutely essential.

Ozasa Which means by extension that communication engineering is important. After all, communication is also something we build up. While my own company differs with Chiyoda in scale, as a manager I see that communication is a structure of posts and beams that facilitate the flow of information much like the flow of blood through the human body. That’s why I am always thinking about how to engineer communication.
I’m referring to deep and universal elemental technologies and organizational frameworks constructed over many years, not a superficial notion of information flow. Chiyoda understands the difference between universality and the kind of information that is useful today but useless in a year.

Kubota Exactly. Society may appear to change on its surface, but its roots hardly change at all. Conversely, a fresh look at root issues can be the source of new directions.

Putting the Corporate Philosophy into Practice through Projects

Ozasa Chiyoda is contributing significantly to the development of resources and preservation of the environment in Qatar. What are the features and significance of your projects there?

Kubota Some of the world’s largest gas fields have been discovered and developed along the coast of Qatar. The Chiyoda Group has been continuously involved in liquefied natural gas (LNG) projects in Qatar for about 20 years, since the early 1990s. Today, Qatar produces 77 million tons of LNG annually, which is about one-third of global LNG production volume. Chiyoda was involved in engineering all of Qatar’s LNG production facilities. Doha, the capital of Qatar, now has a wonderful skyline of high-rise buildings, but it was a small fishing village 20 years ago. Development has improved the standard of living for local residents and the city of Doha has bloomed, but a key point was deciding what support was necessary for the development of the local community. At their peak, the Qatar projects brought together upwards of 75,000 construction workers, and almost all of them were from more than 80 countries besides Qatar. We wanted to leave something with the local community, and therefore created a maintenance and inspection company three and a half years ago, progressively training young engineers from the local community so the company would take root.
Qatar kindly offered to supply an extra 4 million tons of LNG to Japanese electric power companies immediately following the Great East Japan Earthquake. This was the result of the longstanding relationship between Japan and Qatar. It keenly reaffirmed the absolute importance of building trust with the community by determining what the construction of a plant can bring to an area.
Chiyoda has also built numerous LNG receiving terminals in Japan since the 1960s, which has contributed to the stable supply of energy.

Reconstruction after the Great East Japan Earthquake

Ozasa I imagine that Chiyoda is required to play a significant role in the restoration and recovery following the Great East Japan Earthquake.

Kubota First of all, we offer our deepest condolences to the victims of the recent earthquake. The Chiyoda Group has more than ten customers with numerous plants in the area from Aomori to the Kanto region that suffered earthquake damage. Immediately after the earthquake, Chiyoda Group engineers called on these companies to conduct diagnostics and relief reconstruction. We have established the Reconstruction Support Task Team and are concurrently proceeding with construction at dozens of locations. Our intent is to deploy the entire Group in order to complete reconstruction as quickly as possible. Longer term, we believe our support for restoration and reconstruction will build “bonds of trust,” and we clearly understand that it is critical to rebuild supply chains in Japan.

Ozasa The earthquake certainly exposed many of the connections of everyday life that people take for granted. Conversely, Chiyoda is naturally aware of these connections because it works with a long-term perspective. The words “bonds of trust” would not come to you if you are not aware of those connections.
Chiyoda has supported Japan’s post-war reconstruction and growth, indeed the growth of the global economy. Naturally, therefore, Chiyoda is involved in reconstruction following the Great East Japan Earthquake.

Kubota Well, we are professionals in the construction, maintenance, inspection and reconstruction of plants and production facilities, and that is how we can contribute best.

Cultivating Human Resources: Strong Employees Who Contribute to Society

Ozasa Cultivating human resources is part of Chiyoda’s DNA. How does Chiyoda develop its people through projects?

Kubota I worked for eight years in Indonesia beginning in 1987. We were expanding an LNG plant on Kalimantan, and with the first order the Indonesian government requested that we cultivate a local Indonesian engineering company. At the peak of the project, Chiyoda had 40 Japanese engineers involved in areas including engineering, procurement and construction in Jakarta to meet this request. At that time, the local engineering company had 150 employees, but after eight years it had grown to employ 1,500. My experience in Indonesia taught me to share the viewpoint of others and respect them. With such basic thoughts in mind, I managed the site activities, putting the highest priority on safety.
Safety is our core value. It is the basis for building trust with stakeholders, and we repeatedly instill this value in everyone we work with.

Ozasa Chiyoda is currently executing a medium-term management plan that it will complete in the year ending March 2013. Under the theme of “change and creation,” Chiyoda is taking on the challenge of entering areas such as new energy. How will Chiyoda cultivate employees to achieve the targets of the plan and the Company’s future goals beyond the plan?

Kubota As I mentioned, Chiyoda has embraced human capital as a core component of its corporate philosophy since its founding. I want employees to develop their intellect. Intelligence encompasses wisdom and courage. I want strong, vibrant employees who possess these qualities.
I ask our people to develop the strength and wisdom needed to understand their customers and colleagues by studying history and classical thought and by communicating with a variety of people. This will give them the capability to make the bold, complex decisions our businesses require. A company composed of strong employees is likewise strong and well able to contribute to a sustainable society, which is Chiyoda’s objective.

Ozasa I regularly urge employees of my company to maintain an i-Company* mindset. All employees need to think of themselves as a company, to put their thoughts to work for the prosperity and development of their company by linking their personal growth with the growth of their company. People who are both independent and committed are hard to find, so we need to cultivate and increase the number of motivated young people who ask themselves how they can contribute.
* i-Company: a mindset in which people look at themselves as a company, and as a manager growing themselves into an excellent company, eschewing corporate co-dependence in building their own career under their own volition.

Challenges for the Future

Ozasa In closing, in this time of intense change, what challenges will the Chiyoda Group take on in the future?

Kubota We intend to constantly build the social infrastructure people require in their daily lives while contributing to social development. The key will be relying on our corporate philosophy to meet the emerging quests of society, focusing our attention and actions on areas in which we can contribute.

Ozasa I see. The depth of the Chiyoda Group’s organization will remain unchanged as it accommodates the current trends in its operations. I also realize that the Chiyoda Group’s CSR is embodied in its business activities, based on its corporate philosophy. I look forward to your company’s continued success.

Yoshihisa Ozasa
Born 1961 in Osaka. Entered Recruit Co., Ltd. after graduating from Waseda University. Involved in recruiting and other activities in the personnel department. Left Recruit after serving in positions including general manager of organizational and personnel consulting. Established Link and Motivation Inc. in 2000 with a core technology developed to analyze motivation. The Link and Motivation Group currently encompasses eight companies. Author of numerous published works including the recent Motteiru Hito ga Motteiru Kyoutsuten (“What ‘The Haves’ Have”) (Gentosha Inc.)