President’s Message
A Global Glass Manufacturer
The NSG Group is one of the world’s leading glass manufacturers. Over 85 percent of the Group’s operations are in Flat Glass (Building Products and Automotive), making glass for the world’s buildings and vehicles, with the balance in Specialty Glass (Information Technology and Glass Fiber).
Since its foundation in 1918, the NSG Group has based its manufacturing philosophy on the concept of monozukuri (a passion for manufacturing excellence). The Group’s products make a positive contribution to people’s lives and the environment, bringing light into buildings and vehicles, helping to conserve energy, offering protection and transmitting information.
In June 2006, the size and scope of the NSG Group was transformed with the acquisition of 100 percent of the issued shares of the leading UK-based glass manufacturer, Pilkington plc. Combining the strengths of both companies has firmly established the NSG Group as one of the world’s leading glass manufacturers, with a network that includes production sites in 27 countries, sales bases in 130 countries and approximately 34,000 employees worldwide.
The business integration with Pilkington plc has not required significant changes in the Group’s stance toward CSR, as the principles that had been followed by Pilkington were very similar to those already in operation in the NSG Group.
To meet its objectives as a global glass manufacturer, the NSG Group has established a long-term vision setting out its business goals for the next 10 years, with a Medium-Term Plan defining the strategy for the next four years. A global management structure was established in April 2007 and a new statement of "Values and Principles" was published, providing all Group employees with an ethical framework as we move forward into a new era.
NSG Group’s Commitment to CSR
In recent years, Corporate Social Responsibility has become an important management theme within all responsible companies worldwide, with corporations increasingly under pressure to demonstrate commitment to CSR by addressing such major issues as climate change. The NSG Group has diligently implemented strict corporate social responsibility policies since its foundation, and in August 2005, established a CSR Committee to accelerate the promotion of its activities in this important area.
The NSG Group defines CSR as "an activity that establishes a relationship of trust with all stakeholders in order for it to operate as a socially reliable company."
As a member of the Sumitomo Group, a consortium of independent Japanese companies with well-established records and histories reaching back more than 400 years, NSG Group’s management philosophy is based on the "Sumitomo Spirit" of "placing prime importance on trust," "not pursuing easy gains," and "contributing to society through business." Following the Pilkington acquisition, the NSG Group basic philosophy that "people are the most important asset of our company," was combined with Pilkington’s policy, "to achieve business success through professional, fair, ethical, legal and sustainable business practices." In this way, the Group has established a new management policy that is more suited to the operations of a global company.
With the business integration as a turning point, the NSG Group intends steadily to realize the synergies, while establishing a corporate governance structure in order to conduct efficient business operations on a global scale.
A Socially Responsible Glass Manufacturer
Over the past 20 years, glass demand has grown, driven not only by economic growth, but also by legislation and regulations concerning safety, noise attenuation and the response to the growing need for energy conservation. Architects and car designers are using increasingly more glass in buildings and vehicles.
Glass manufacturing is an energy-intensive process, but energy usage in manufacture is offset by the significant contribution that the Group’s advanced glass products make to energy conservation and the sustainability of the business. Since its inception, major environmental improvements have been made in the Float Process. Emissions have been reduced significantly and substantial reductions have been made in energy consumption.
Despite this progress, the NSG Group continues to strive to improve overall energy consumption and CO2 emissions in all our operations and through our product range. Technologies for recycling glass and for the addressing the issue of End of Life Vehicles are a significant focus. As a responsible manufacturer, the NSG Group is increasingly applying its technological skills to find solutions to the issue of climate change (for details, please refer to the "Special Features" section of this report).
Steadily Pursuing Innovation:'First in Glass’
Throughout its history, the NSG Group has focused on glass materials in its pursuit of innovation, driven by the Group’s spirit of monozukuri. Today, the Group is a global leader in manufacturing excellence and innovation in glass, notably in glass melting, glass forming by the float process, on-line coating and complex shaping technology, especially for automotive windscreens and backlights.
The acquisition of Pilkington brought into the Group the company that invented the Float Glass process, the worldwide standard for the manufacture of high quality glass. It also increased the number of float plants in which the Group has an interest or directly operates to 51. This offers increased scope for the development of manufacturing excellence-through benchmarking, best practices and standard operating procedures.
The Group’s new organization, introduced during 2007, will facilitate adaptation to the acquisition, which has dramatically altered the Group’s business focus and geographical spread. The new organization will also address issues such as increasingly intense global competition, a rapidly changing business environment and growing social responsibilities.
The Group’s four-year Medium-Term Plan, launched in April 2007, will drive strategy for the near future. The main objective is to create a new entity, differentiating the NSG Group from its competitors, maximizing productivity and operational quality and re-establishing the Group’s financial foundations. The overall aim is to realize the ambition embodied in the slogan adopted by the Group, which is to be 'First in Glass.’
To Our Stakeholders
The publication of the NSG Group’s first CSR Report represents an important development, reflecting both the organizational changes the Group has experienced over the past year and our determination to improve our CSR reporting. The new CSR Report replaces the Environmental Social Activity Report the Group has produced since 2004. This new format will enable us to provide more detail and data to enable our stakeholders to monitor our progress in all aspects of the filed of Corporate Social Responsibility.
While a number of issues needing resolution remain, the NSG Group intends to contribute to work toward the development of a sustainable company, through our business activities and through dialogue with our stakeholders.
February 2008
Katsuji Fujimoto
President and Chief Executive Officer
