Sojitz Corporation

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Medium-term Management Plan 2023
~ Start of the Next Decade ~ 
(April 30, 2021)

In April 2021, Sojitz Corporation launched Medium-Term Management Plan 2023 ~ Start of the Next Decade ~, its new three-year medium-term management plan.

Vision of Sojitz and Direction

Vision of Sojitz and Direction

[Medium-term Management Plan 2023 ~ Start of the Next Decade ~]

Medium-Term Management Plan 2023 ~ Start of the Next Decade ~, Sojitz’s new three-year medium-term management plan, was launched in April 2021. This plan defines Sojitz vision for 2030 as becoming a general trading company that constantly fosters new businesses and human resources. To pursue this vision, Sojitz will continue to fulfill its mission as a general trading company: delivering goods and services where necessary. At the same time, we will seek to increase corporate value by creating business and human resource value that responds to market needs and social issues. Accordingly, the Company looks to pursue competitiveness and growth by adopting market-oriented initiatives, applying co-creation and sharing methodologies, and striving for speed to propose solutions that respond to market needs and social issues. Organizations and human resources will be transformed to accommodate these undertakings.

[Medium-term Management Plan 2023 ~ Start of the Next Decade ~]

Financial Targets

Financial Targets

Focus areas

Under Medium-Term Management Plan 2023, personnel and funds will be concentrated on three focus areas: the infrastructure and healthcare field; growth markets like the ASEAN region and India, which will be approached through market-oriented initiatives; and the material and circular economy field.

Focus areas

Disciplined BS and CF management

Sojitz will continue to practice balance sheet management aimed at creating quality profits and cash flows out of quality assets to be used for conducting growth investments and shareholders returns through a disciplined cash flow management approach.

Disciplined BS and CF management

Value Creation Measurement and Evaluation

To guide efforts to heighten corporate value, a target of over 10% has been set for return on equity (ROE) based on the level of 8% for shareholders equity.

In addition, division targets for cash return on investment (CROIC) have been included in Medium-Term Management Plan 2023 for the purpose of increasing the Company’s ability to achieve its ROE target. Specifically, a “value creation line” has been defined for each division indicating the minimum level for average CROIC they need to accomplish over the three-year period of the medium-term management plan. Each division will be responsible for clearing this line. By having divisions shape their activities based on CROIC, Sojitz will seek to ensure it accomplishes its ROE of over 10%.

In addition, for business investments, Sojitz will monitor whether return on invested capital or CROIC is 5% or higher. This will be a mechanism to confirm whether existing business investments are generating earnings in excess of the cost of capital, i.e., whether they are leading to value creation. In this way, Sojitz will raise awareness of the need to improve corporate value.

Value Creation Measurement and Evaluation

ESG ~ Sustainability Challenge ~

With regard to sustainability, Sojitz management is premised on initiatives based on the Sojitz Group Statement, two types of value, and key sustainability issues. The Sustainability Challenge, which represents Sojitz’s long-term vision for 2050, defines the Company’s goals for helping achieve a decarbonized society and responding to human rights issues. One of these goals is to achieve net zero CO2 emissions by 2050.

Sustainability
ESG ~ Sustainability Challenge ~

ESG ~ Human Resource Strategies ~

As Sojitz strives to become a general trading company that continues to create businesses and human resources, it will implement various human resource strategies with the theme of transforming diversity into competitiveness.

ESG ~ Human Resource Strategies ~

Dividends

The dividend policy of the Medium-Term Management Plan 2023 is based on targeting a consolidated dividend payout ratio of approximately 30%.

The lower limit for dividend payments will be set as market price-based dividend on equity, based on the Company’s average stock price from the previous fiscal year, of 4% until the price book-value ratio reaches 1.0 times and book value-based dividend on equity of 4% after the price book-value ratio reaches 1.0 times.

Dividends
Dividends

Strategic Policy by Division

Strategic Policy by Division

[Medium-term Management Plan 2023 ~ Start of the Next Decade ~]

[Medium-term Management Plan 2023 ~ Start of the Next Decade ~](PDF)

Caution regarding Forward-looking Statements

This document contains forward-looking statements based on information available to the company at the time of disclosure and certain assumptions that management believes to be reasonable. Actual results may differ materially based on various factors including the timing at which the COVID-19 pandemic ends; changes in economic conditions in key markets, both in and outside of Japan; and exchange rate movements. The Company will provide timely disclosure of any material changes, events, or other relevant issues.

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