Sumitomo Electric’s Shareholders General Meeting was held without a hitch on June 26. The Shareholders General Meeting, which involves enormous preparatory effort on the part of the organizing staff, serves as a once-a-year opportunity to report directly to our shareholders. As the top of a corporate group, I did my best to explain the company’s current business activities, key issues to be addressed in the years ahead and our ambitious visions, in concrete and clearly understandable terms. I hope I successfully presided over the Meeting. I am open to feedback from shareholders who actually attended the event.

In fact, as I raised my voice in my presentation, I felt our future directions become even clearer and had a feeling of tension and determination to fulfill my mission and duties as a corporate director. I am not loath to attend shareholders general meetings. Rather, I enjoy them very much, in a sense.

This year, a total of 390 shareholders attended the Meeting, which lasted for one hour and 15 minutes. In recent years, questions raised by shareholders have become diverse. At the Meeting, we as corporate directors did our best to give the most honest and sincere replies we could regarding our commitment to environmental issues, technology and product development efforts, the outlook for each business segment, employee issues, including the issue of how skills can be passed on to younger employees etc. All these questions arose from our shareholders’ keen interest in the Sumitomo Electric Group and their confidence in our business management, if I do say so myself. I deeply appreciate these devoted shareholders’ support of the Group, whose name recognition has not increased easily, due to its relatively few end-user product lines.

This year we changed the venue of our shareholders general meeting to the Ritz-Carlton Osaka, one of the most prestigious hotels in Osaka. The venue we had used for the last several meetings became a bit insufficient to accommodate the increasing attendance, in addition to being somewhat inconveniently located. As it turned out, the number of attendees increased by more than 70% over last year, and seats that had not been arranged for use were hastily made available to shareholders. I was very glad to hear that, and was quite relieved to find that we were able to satisfy our shareholders.

As I mentioned in this blog last year, a shareholders general meeting is a public company’s supreme decision-making body. We corporate directors must carry out our duties in full awareness of the fact that we are responsible for realizing the kind of company management that can obtain our shareholders’ willing agreement to all the proposed resolutions.

It is another rainy day today; indoors, we have free and lively discussions over tea in front of the fireplace.
In retrospect, Mr. Simon Payton had grasped - with amazing accuracy - the essence of Anglo-Saxon culture, which is an underlying basis of globalization. In the quiet manner befitting a knowledgeable English person, he enumerated the key words, recalling the lessons of history. He argued that “freedom,” “fairness,” “transparency,” “flexibility” and “competition” constitute the essence of Anglo-Saxon culture, and that an organization, if it is going to rank with its competitors in this culture, should be “leaner,” “tighter,” “smarter” and “faster,” and that leaders, of whom “listening,” “feeling” and “touching” are expected, have a duty to achieve results by optimally allocating human, physical and financial resources through these three actions. As I recall his argument now, when Japanese-style management is under review for improvement, I feel that many of his points are convincing. I am impressed by his penetrating insight.

When Mr. Payton visited Japan the other day, I made arrangements for a dinner meeting, since there is nothing quite so pleasant as a visit by a friend come from far away, as Confucius says. As usual, he argued with passion on economy, politics and various other issues. When the topic moved on to Anglo-Saxon and Japanese cultures as a matter of course, he suddenly became quiet, maybe recalling our discussions from a long time ago. He then smiled, filled with self-confidence, and said to me: “History repeats itself, so don’t worry.”
Will I be able to make so witty a comment as that, the next time an opportunity arises?

[ This entry is a translation from the contributed essay that appeared in the “Danron (Discussion)” section of Tekko Shimbun ("Japan Metal Daily"), January 17, 2000.]

Noticing that my tea, which I just made, had become cold, I looked out the window to find that it had begun raining. Tea and intermittent rain instantly made me think of winter in England, with which a fireplace matches well, among other things. This association brought to mind a memorable encounter dating back to 1985.

I encountered Mr. Simon Payton, Secretary General of the International Wrought Copper Council (IWCC), at the IWCC headquarter building in London. I had just begun work as Japan’s representative to the council after arriving in London to take up a new position. That encounter enriched my seven-year expatriate life in England, and created opportunities for me to ponder deeply about Anglo-Saxon culture.
In those days, as symbolized by the book “Japan as Number One,” Japanese-style management philosophy was in the ascendant, sweeping over the United States and Europe. Management techniques based on Japanese culture were about to become what is now called the “de facto standard.”

Mr. Payton, a talented graduate from the prestigious University of St. Andrews and a controversialist in the metal processing industry, was invited to join the IWCC. As a director of an international organization, he needed to deepen his interest in and understanding of the culture of Japan, an economic power in Far East Asia. Sharing the same interest, we were like-minded persons and felt at ease with one another, partly because we are from almost the same generation. We would often meet at the headquarters after finishing the day’s work, to talk enthusiastically about culture.

[ This entry is a translation from the contributed essay that appeared in the “Danron (Discussion)” section of Tekko Shimbun ("Japan Metal Daily"), January 17, 2000.]

Mr. Simon Payton and I belong to almost the same generation.
He came from Birmingham to London to serve as Secretary General of the International Wrought Copper Council (IWCC). For many years, from 1984 to 2008, he successfully steered the organization by drawing on his outstanding coordinating ability and good judgment, although international organizations often lack solidarity among members. He was a de facto CEO.
Partly because he has the sense of humor typical of English gentlemen, he was well liked by other members.

I worked in London from 1985 to 1992 as an overseas representative of Sumitomo Electric, so I associated with him both in business and privately.

As a graduate from the University of St. Andrews, a prestigious university - and the oldest one in Scotland - he had an atmosphere created by a kind of elitism, which made me feel at first that there was a snobbish streak in him. However, as I got to know him, I found that he had a fine human quality, and I learned various things from him. Fortunately, he speaks the Queen’s English, which was easy to follow for non-native speakers of English and helped me a lot.
Since we have known each other for a long time, I can think of countless topics for talking about him.

When on this airplane I began to feel it was about time to start preparing for the IR meeting, it occurred to me that I once wrote a requested essay about Mr. Payton for the Tekko Shimbun ("Japan Metal Daily"). Fortunately, I found the draft for the article, titled “Warai no shin’i (The Meaning of His Smile)” which I contributed to the Tekko Shimbun in 2000. The next time, an English translation of the article will be posted on this blog. I hope readers will find something useful in my essay about that friendship.

I am writing this entry on an airplane that left Narita on June 3 for Boston via Chicago.

Once a year we visit the United States to hold information meetings for a number of large-scale investors. I explain to them in person the company’s current status and future prospects, in both qualitative and quantitative terms, and provide Q&A so that investors can hold, or purchase more of, our stock, based on convincing and satisfactory explanations.
As I mentioned more than once on this blog, holding such meetings is one of the key investor relations (IR) activities, and one of the most important duties of a company president in a capitalist society. We also visit Europe, Southeast Asia and other parts of the world to hold similar meetings on a regular basis.

I just looked over the bulky documents given to me in advance by the Investor Relations Office. I did not have enough time to review them, since miscellaneous jobs come in one after another while I am in Japan. On an airplane, however, where I have plenty of time and no one will interrupt, I can read the materials carefully and work over my ideas for presentations.

From the airplane window I only see darkness, and all I hear is jet engine sounds. Passengers around me seem to be resting in quiet, though I occasionally hear snores.

In writing this entry thus far, these things came across my mind:
“Oh, yes. I was planning to report about the Danube River excursion program that I took the other day during my Vienna visit to attend the IWCC international meeting.”
“But my impressions have faded as the days have gone by. What shall I do?”
“Taking up something else, it may be a good idea to write about Mr. Simon Payton, my long-time friend, who served as a secretary general of IWCC from 1984 to 2008.”
“Fortunately, I’ve got some pictures of us enjoying the lush, verdant scenery along the Wachau valley under a cloudless sky during the Danube River cruise.”

So I’ll write next time about Mr. Simon Payton, who is a true English gentleman in my eyes.

The IR Meeting comprised a briefing on the business results for FY2007(April 2007 – March 2008) and the forecast for FY2008 (April 2008 – March 2009)in connection with the progress of the new mid-term plan “VISION 2012,” and supplementary information on the financial figures of the account settlement, which was provided by Senior Managing Director Yoshiaki Nishimura (responsible for accounting). To update investors regarding the Group’s topical developments, Managing Director Yuichiro Kohno gave a presentation on the powder alloy-related business in the Industrial Materials Business Unit. The presenters did their best to explain the company’s current status and future growth potential in an easy-to-understand manner.

In the Q&A session that followed, we received various comments and questions from analysts. As usual, I was impressed by their tough and sharp analyses. It was hard for us to give appropriate replies to some questions, posed in connection with anticipated profit decline for the current fiscal year. Even so, all the respondents, including myself, squarely addressed the topics without trying to shy away from any question, and did our best to give the most honest, sincere replies. I am determined to step up my effort, using such IR and diverse other opportunities - mainly overseas - so that we can be recognized as an excellent company worthy of investment.

The content of this IR Meeting, excepting the Q&A session, is available in PDF format on Sumitomo Electric’s website, on the Investor Relations’ pages (Presentation Materials-FY2007 Results and FY2008 Forecast (May 21, 2008)). I invite you to visit those pages.

Upon the settlement of accounts, we usually hold our regular Investor Relations Meetings, which are designed to provide information to investors and analysts. As for the last account settlement, the first IR meeting, held in Tokyo on May 21, was a bit delayed partly because I attended the IWCC meeting.

I earlier presented some of my views on investor relations (IR) on this blog. I would like to emphasize again that we as a listed company ought to disclose corporate information at the right time, and in the right manner, to shareholders who own our company’s stocks, as well as to individuals and corporations that are considering investment in our company. Sumitomo Electric wishes to make widely known the company’s current status and future directions, by providing a detailed brief to institutional investors and other interested parties regarding the financial figures of the account settlement, the progress we are making on the mid-term plan, developments in our key business segments and other issues. Therefore, we have been holding these IR meetings for a long time, in various forms, worldwide.

The post-settlement IR meeting in Japan for analysts was held in the Tokyo Head Office, as usual. I regretfully reported that, at the last IR meeting in Tokyo, we had slightly fewer participants than the previous meeting. This time, however, the IR meeting attracted as many as 150 participants. As the venue became packed to its fullest capacity, secretariat staff who were taking the minutes at the back of the hall hastily set up tables for participants arriving late. We apologize for any inconvenience, if it was difficult for participants sitting in the rear rows to see the visual presentations. In my own presentation, I tried to be easy to understand, speaking through a microphone.

The content of this IR Meeting is available in PDF format on Sumitomo Electric’s website, on the Investor Relations’ pages (Presentation Materials-FY2007 Results and FY2008 Forecast (May 21, 2008)). I invite you to visit those pages.

March winds, April showers, May flowers and June brides – these changes in the European scenery from early spring to early summer are so attractive that everyone might feel this is the best season of the year. Particularly in May, in the balmy breeze, all sorts of flowers burst into bloom, almost covering the gentle slopes of hills.
This year again I participated in the sightseeing programs organized by the IWCC secretariat. We visited Melk, a town located approximately 100 km west of Vienna. It took about 90 minutes by bus from Vienna to Melk.

Called the Wachau Valley, this area is one the most scenic places in the Danubian regions. The town of Melk, located in the central part of the Wachau region, is famous for the Benedictine abbey of Melk. According to our tour guide, the original abbey building was renovated and expanded in 1730 by Berthold Dietmayr, who was appointed abbot of Melk when he was only 30 years of age. Since then, the imposing figure of the abbey has been reflected on the water of the Danube River. I wonder if the word “imposing” is appropriate for an abbey, but the Melk abbey might have served as a fortress in the past.

During the interior tour of the abbey, I learned that the abbey used to serve as a lodge for the Hapsburgs as I expected, and there was a surviving document suggesting that Napoleon billeted in this abbey during his military expedition, regarding it as a safe place. Of course Empress Maria Theresa frequently stayed here, reportedly accompanied by as many as 300 attendants.

The hallway is 200 meters long, each room decorated so as to coordinate with the majestic and gorgeous baroque-style architecture, just as you would expect from a residence of the Hapsburgs.
Our tour guide was a lady of wide knowledge. She pronounced each word (English) articulately, which was of great help to the Japanese group. We were able to even ask questions, as we understood her explanations. This also made our sightseeing tour a very valuable experience.

Our next destination was the village of Duernstein in the Wachau region. The village is blessed with soil and climate suitable for grape growing. Needless to say, the purpose of the visit was wine tasting. As you may know, Austria (particularly the Wachau region) is renowned worldwide for its white wine, called Riesling. Since I am very interested in vineyard cultivation of the Riesling grape, as well as the winemaking process, storage and the like, I attentively observed the winery. It was supposed to be a “tasting,” but I drank up all glasses of the slightly dry Riesling wine as they were offered me. After a 40-minute tasting, I became slightly intoxicated and had a good sleep on the return bus.

I also took the Danube River cruise and enjoyed the scenic view of the Wachau region from the river, but I must stop writing now since, that would be a long story.