#
01 Contents
02 Editorial Policy
03 A Message from the CEO
08 Value Creation Model
09 Business Overview
Value Creation Story
01
SECTION
52 Financial Data Summary
53 Non-Financial Data Summary
54 The MOL Group’s Global Network/
History of the MOL Group
55 Information Disclosure and External Recognition
56 Glossary (In alphabetical order)
57 Shareholder Information
Corporate Information
04
SECTION
37 Special Feature: Governance Meeting
Dialogue Between Outside Directors and Shareholders
43 Corporate Governance
45 Board of Directors and Audit & Supervisory Board
Members
Corporate Governance
03
SECTION
CONTENTS
11 Vision for BLUE ACTION 2035
12 Portfolio Reform
14 A Message from the CFO
17 Portfolio Strategy
18 Overview of Operations by Business Headquarters
22 Environmental Strategy
23 Disclosure Based on TCFD Recommendations
25 Special Feature: The MOL Group’s Offshore Wind
Power Generation-Related Businesses
27 Regional Strategy
28 Sustainability Issues (Materiality)
29 Initiatives for Sustainability Issues
BLUE ACTION 2035
02
SECTION
Corporate Management Plan
03
A Message from
the CEO
37
Governance Meeting
11
MOL Group Corporate Management Plan
BLUE ACTION 2035
Three Core Strategies and
Initiatives for Sustainability Issues
18
Overview of Operations
by Business Headquarters
14
A Message from
the CFO
25
Special Feature:
Offshore Wind Power
Generation-Related Businesses
Photo provided by Ørsted
01 Value Creation Story
Contents/Editorial Policy
02 BLUE ACTION 2035
03 Corporate Governance
04 Corporate Information
1
MITSUI O.S.K. LINES
MOL REPORT 2023
This report is intended to help shareholders, investors, and other stakeholders understand and accept
the Group’s new mission of “Taking the leap to becoming a global social infrastructure company” and the
corporate value it seeks to create, as set forth in its new corporate management plan, BLUE ACTION 2035.
While our company’s objective is to reform its portfolio to generate stable profits even when shipping
markets are sluggish, our company has also taken on the challenge of meeting growing environmental
needs and expanding our offshore wind power generation-related businesses, and our company has
made every effort to explain in an easy-to-understand manner where we will seek future growth while
expanding our strengths in the shipping business, which our company has worked on throughout our long
history. The report also describes sustainability issues, focusing on priority areas of safety, environment,
human resources, DX, and governance. In particular, the Governance section contains a six-page feature
on the Governance Meeting, a direct dialogue between outside directors and shareholders.
We sincerely hope this report serves as a tool that deepens dialogue with shareholders, investors,
and other stakeholders, thereby enabling management to receive better feedback and further enhancing
disclosure.
Investor Relations Team, MOL Report 2023
The MOL Group, comprising Mitsui O.S.K. Lines, Ltd., 385 consolidated subsidiaries, 124 equity-method
affiliates, and other affiliated companies (If the subject of activities or data are limited, this is indicated
by notes in the report.)
This report contains forward-looking statements concerning MOL’s future plans, strategies, and performance.
These statements represent assumptions and beliefs based on information currently available* and are not
historical facts. Furthermore, forward-looking statements are subject to a number of risks and uncertainties
that include, but are not limited to, economic conditions, worldwide competition in the shipping industry,
customer demand, foreign currency exchange rates, bunker prices, tax laws, and other regulations.
MOL therefore cautions readers that actual results may differ materially from these predictions.
Upon Publication of MOL REPORT 2023
Scope of the Report
Communication Map
Forward-Looking Statements
Editorial Policy
*As of the end of July, 2023, unless otherwise specified
Financial
Non-Financial
MOL Report (Integrated Report)
Investor Guidebook
Website
“IR Information”
Securities Reports
Business Performance
Briefing Materials
Website
“Sustainability”
Corporate Governance
Reports
Vessel on the Cover
Index for Reverse Lookup of Topics in the
Guidance for Collaborative Value Creation
Referenced Guidelines
• “Integrated Reporting Framework,” IFRS Foundation
• “Guidance for Collaborative Value Creation,”
Ministry of Economy, Trade and Industry
The “Sunflower Kurenai,” which commenced service
on the Osaka-Beppu route in January 2023, not only
offers improved transport capacity and convenience
for both cargo and passenger transport compared to
existing vessels, but also is the first ferry in Japan to be
equipped with a high-performance dual-fuel engine that
can use both LNG and heavy oil, the first of its kind in
Japan. The use of LNG fuel is effective in reducing CO2,
SOx, and NOx emissions by approximately 25%, 100%,
and 85%, respectively, thereby reducing the burden on
the environment. The Company has already ordered
four LNG-fueled ferries for the ferry business, including
this vessel, and will continue to accelerate the reduction
of total GHG emissions by further expanding the
introduction of LNG-fueled vessels, thereby contributing
to the realization of a low-carbon society.
Governance
P37–50
6
Values
P3–7
1
Business Model
P3–7, P9–10, P17–21, P25–26
2
Sustainability and Growth
P3–7, P11–36, P51
3
Strategy
P3–7, P11–36
4
Growth (Performance) and Key Performance
Indicators (KPIs)
P8, P11–12, P15–20, P22–23, P29–33, P35, P50,
P52–53
5
Underlined words in this report are explained in
the Glossary on page 56.
LNG-fueled ferry “Sunflower Kurenai”
01 Value Creation Story
Contents/Editorial Policy
02 BLUE ACTION 2035
03 Corporate Governance
04 Corporate Information
2
MITSUI O.S.K. LINES
MOL REPORT 2023
A Message from the CEO
President & CEO
One of the MOL Group’s major challenges after the introduction of the first Rolling Plan in
fiscal 2017 was to improve its financial position. Our financial position had been severely
damaged by our efforts to cope with the long-term slump in the shipping market since 2010
caused by oversupply of vessels and our extensive investments in energy and other sectors
to secure stable earnings in the future. It was imperative that we recover from this in order
to take the next step. Under these circumstances, the booming market conditions in various
shipping sectors, especially containerships, from fiscal 2021 to fiscal 2022 allowed us to post
huge profits and dramatically improved the company’s financial position, which was a major
turning point for the company.
In fiscal 2022, ended March 31, 2023, we saw improvements in our financial indicators
as well as positive outcomes related to our portfolio, environmental, and regional strategies
that we had put forth as growth strategies. The company’s strategy is to seek growth not
by extending the existing businesses, but by reorganizing the priority investment areas
and transforming the business portfolio. The company has steadily spread this approach
throughout the group, and we have also steadily built-up new businesses that are rooted in
our regional strategy, particularly in India. Through these efforts, we have continued to steer
the company with a strong awareness of shifting the mindset within the company, from a
conservative approach settled under a prolonged market slump to an aggressive stance.
Dramatic Improvement in Financial Indicators Against a Backdrop of
Soaring Freight Rates, Especially for Containerships
Review of Rolling Plan 2022 (Management Plan)
“Now” is the time to break conventions
The goal is to transform
MOL into a “resilient global enterprise”
01 Value Creation Story
02 BLUE ACTION 2035
03 Corporate Governance
04 Corporate Information
Contents/Editorial Policy
3
MITSUI O.S.K. LINES
MOL REPORT 2023
Since the 2008 global financial crisis, a series of events, including the Great East Japan
Earthquake and trade frictions between the U.S. and China have made it difficult to foresee
the future. Under such business environment, the company has concluded that a conventional
approach of analyzing global economic trends, forecasting shipping demand and supply, and
formulating a medium-term management plan to conform to these forecasts would no longer
work. Therefore, the Group has adopted a single-year management plan since fiscal 2017, to
take the most appropriate and flexible actions according to the circumstances. However, when
we look at the future from a wider perspective, the entire global economy is undergoing
significant long-term changes, and major structural changes are underway that cannot be
captured from a single fiscal year analysis.
The most extreme is addressing environmental issues. While a major global consensus
is emerging that the economy must be managed with a strong awareness of the environment
and sustainability to survive, we have set a goal of achieving net zero emissions by 2050,
ahead of other companies in the shipping industry. This goal is far from achievable through
the series of single-year plans alone. Currently, we consume 4-5 million tons of fuel oil
annually and emit over 10 million tons of GHGs. To achieve net zero emissions by 2050, a long-
term effort that mobilizes a variety of measures
is required. In the world of marine fuels, there
are many options for decarbonization, including
biofuels, ammonia, hydrogen, and batteries, and
we need to identify the right options. In addition,
long-term planning is necessary to transform
the business by seizing business opportunities
arising from the major changes in freight
transportation demand and logistics that will
accompany the decarbonization of the industry.
As we strive towards decarbonization, we must also continue to provide stable and
continuous transportation services. Since 2020, the global logistics witnessed disruption due
to the COVID-19 pandemic and the Russia-Ukraine conflict, which directly had an impact on the
lives of people. We realized the criticality of international logistics and the risk of paralyzing
entire global economy. As a social infrastructure company, we aim to establish a stable
foundation that enables us to continue our business even under challenging conditions, and
the formulation of the new management plan addresses this need.
Based on this understanding, we deliberated on our future state of growth, and concluded
to break from our rolling, single-year management plan that had been in place since fiscal
2017, and we formulated a new mid to long-term management plan, BLUE ACTION 2035, using
the backcasting method to determine our policies based on the vision for 2035. Although this
is a long-term frame for a typical management plan, we set targets for 2035 as our
intermediate point to achieve our goal of net zero emissions by 2050.
BLUE ACTION 2035 integrates our business plan with our initiatives to address
sustainability issues. We believe that, for growth opportunities and to be relevant in the
global economy, we will have to address sustainability issues and contribute to solving social
issues. The plan is divided into three phases over the 13 years to 2035, with core KPIs for both
financial and non-financial aspects, and clear milestones to be achieved by 2035. In addition,
Phase 1, a three-year plan up to 2025, is an elaborate plan, and the plan is to refine the details
beyond with time. We shall devote all our efforts to ensuring the realization of these plans.
The shipping industry is a cyclical industry, its performance greatly influenced by the global
economic cycle and is known for its cyclical nature. Market conditions have skyrocketed
several times when viewed over a 10- or 20-year range. In addition, unforeseen events such
as wars and catastrophes can tighten supply and demand balance and cause freight rates
Achieve Both “Business Transformation Toward Achieving Net Zero by
2050” and “Realization of Sustainable Social Infrastructure Business”
Background of BLUE ACTION 2035
Portfolio Reform to Achieve Stable Growth with
Marine Transport Business as the Core
Point 1 of BLUE ACTION 2035
01 Value Creation Story
02 BLUE ACTION 2035
03 Corporate Governance
04 Corporate Information
Contents/Editorial Policy
4
MITSUI O.S.K. LINES
MOL REPORT 2023
to soar. The opportunity to enjoy unexpected
profits over a long period can be said to be an
attractive feature of the shipping business. On
the other hand, however, considering the huge
capital investment required for consistent fleet
renewal to continue the business, the company
cannot solely rely on this irregular economic
boom.
While the shipping business will continue
to be our core business and a source of
competitive advantage that generates high
returns during market boom, we shall also
diversify and invest in other businesses to stabilize our earnings base. If the company is able
to ascertain stable cash flow from other businesses even in an unfavorable shipping market,
the company will be able to continue to invest in vessels even when market conditions
deteriorate, and thus, shall be able to reap rewards in the next economic cycle. In addition, it
is also expected to discipline overinvestment in ship types that have experienced favorable
market conditions.
Based on this perspective, the approximate investment of ¥1.2 trillion in Phase 1 of BLUE
ACTION 2035 will focus on stable revenue businesses, mainly in the non-traditional shipping
sector. To date, the Group has worked to strengthen its LNG carrier business and offshore
business to increase the ratio of stable earnings. In particular, MOL’s LNG carrier business
has grown to become one of the world’s leading businesses in terms of both scale and
competitiveness. Furthermore, the group intends to increase the asset allocation to areas within
the shipping industry where long-term contracts can be obtained, such as crude oil carriers and
LPG carriers, as well as to businesses different from industrial cargo transport, such as domestic
ferries and cruise ships, and to land-based businesses such as real property and warehouses.
We aim for the best mix of businesses that can resist recession, maintain stable dividends, and
enjoy large profits when market conditions are favorable, by striking a good balance between
market driven businesses such as containerships, which offer high returns but also large
fluctuations in earnings and stable revenue businesses such as LNG carriers and real estate,
One of the major changes in our business under BLUE ACTION 2035 is the establishment of the
Headquarters of Wellbeing & Lifestyle Business, a unit responsible for businesses including
real estate, ferry services and cruises. The purpose is to clarify our stance on nurturing
these business groups, which operate in a cycle different from the shipping market, as a new
revenue base. We have positioned cruise as one of the new growth areas and have decided
to build two new cruise ships to expand this business sector. Prior to the launch of these ships,
we are aggressively investing in the purchase of an existing cruise ship. The decision is based
on the recognition that the mature domestic market demands high-end services as consumer
behavior recovers from the COVID-19 pandemic. We shall provide high quality services while
capturing inbound customer demand from overseas as well as solid domestic demand.
In the real property business, another key growth area, consolidated subsidiary DAIBIRU
CORPORATION has so far developed its business mainly by leasing office buildings in Japan.
Going forward, we will also strengthen our overseas business by leveraging MOL’s network
and diversify our assets to include restaurants, shopping facilities, hotels, and more. Although
the shift from goods consumption to consumption of services is a headwind for the shipping
industry, we shall develop a group of businesses that can respond to the growing demand for
the consumption of services within the Group and align to the new society of the future.
which offer relatively low returns but also small fluctuations in earnings. We shall use the
concept of “ROA Cost of Capital,” introduced as a tool for this purpose, to improve capital
efficiency and promote appropriate business portfolio management.
P14
Establishing Headquarters of Wellbeing & Lifestyle Business
Point 2 of BLUE ACTION 2035
Growth Through Deepening Regional Strategy
Point 3 of BLUE ACTION 2035
In formulating our management plan, we conducted a megatrend analysis through 2050, and
once again strongly felt that each region’s economy is at a different stage of development
01 Value Creation Story
02 BLUE ACTION 2035
03 Corporate Governance
04 Corporate Information
Contents/Editorial Policy
5
MITSUI O.S.K. LINES
MOL REPORT 2023
and maturity, and that the fields in which growth can be expected are very different. This
means that there is a huge difference in requirements between developed countries with
mature economies and the developing economies of Southeast Asia, South Asia, and Africa.
As a group, we also need to adopt business strategies that match the characteristics of each
economic zone.
In Europe and North America, we should expand with a focus on businesses related to the
environment and renewable energy. In Southeast Asia, India, Africa, and other regions, there
is still potential in conventional energy, resources, steel, and automobiles, which have been
the Group’s forte.
Thus, we hope to deepen regional strategies and growth by aligning regional characteristics
with our overall strategy. To that end, we have divided the world other than Japan into five
regions (East Asia; Southeast Asia and Oceania; South Asia and Middle East; Europe and Africa;
and the Americas) and appointed executive officers in charge of each region. We will also boldly
strengthen our organizational structure, such as transferring the decision-making authorities
from the Tokyo Head Office to each region.
P27
The MOL Group has positioned the environmental strategy as one of its key strategies in BLUE
ACTION 2035 and has designated ¥650.0 billion, the majority of the total investment in Phase 1,
for environment-related investment. In April 2023, MOL announced MOL Group Environmental
Vision 2.2, an update from the previous Environmental Vision 2.1, which included the
development of interim milestones and specific emission reduction pathways.
Among a series of measures based on these policies, one of the Group’s distinctive
features is its strong emphasis on the conversion to LNG fuels. In the shipping industry, there
are calls for clean methanol and biodiesel derived from renewable energy sources, which are
alternative fuels that do not require large capital investments, but these alternative fuels are
currently available in very small quantities only. In a sense, it may give shipping companies an
exemption from environmental measures to maintain ships that can use both methanol fuel
and fuel oil, and wait until the supply system
is established. However, we do not believe that
continuing to use fuel oil while waiting for the
supply of new fuel is appropriate from a carbon
budget perspective.
LNG fuel is not a completely zero-emission
fuel, but it has the advantage of reducing GHG
emissions by 20-30% compared to conventional
fuel oil, and it produces almost no SOx, NOx, or
other air pollutants. The biggest advantage over
other alternative fuels is that they are ready to
use today because of their substantial production and supply systems and their extensive use
history. On the other hand, LNG fuel requires storage at a low temperature of nearly minus
160 degrees Celsius, which makes LNG fueled ships about 20% more expensive. However,
we believe that the economic advantage of natural gas will gradually increase through lower
gas prices, as abundant reserves of natural gas are confirmed to be dispersed throughout
the world, and new gas field developments and new LNG projects are being launched
continuously. In fact, we feel that an international consensus is emerging on natural gas and
LNG as important fuels during the transition to renewable energy.
The Group is promoting the conversion to LNG fuel as an immediate action. In the future,
when a mass production and supply system for fuels that can further reduce GHG emissions is
in place, the company shall boldly take the helm again.
Promoting Conversion to LNG Fuel as an “Immediate Action”
Point 4 of BLUE ACTION 2035
P31
Raised the Shareholder Return Target to a Dividend Payout Ratio of
30% and a Minimum Dividend of 150 Yen per Share
Shareholder Return Policy
In light of our significantly improved financial position, in Phase 1 of BLUE ACTION 2035,
we raised our target for shareholder returns, setting a dividend payout ratio of 30% and a
minimum dividend of ¥150 per share.
01 Value Creation Story
02 BLUE ACTION 2035
03 Corporate Governance
04 Corporate Information
Contents/Editorial Policy
6
MITSUI O.S.K. LINES
MOL REPORT 2023
Although we have gradually increased the dividend payout ratio from the previous
20%, we recognize that a dividend payout ratio of 30% is still somewhat low compared to
the Tokyo Stock Exchange’s Prime Market average and global standards. However, the
shipping industry requires constant capital investment, and with the prospect of huge future
investment in environmental measures, the company needs to allocate a certain amount of
retained earnings to new investments.
The nature of the business will not change going forward, but the contribution to profits
from investments that have already been decided, such as aggressively accumulating assets
in the LNG carrier business over the past several years, will make a significant contribution
to profits over the next three years. We are, therefore, determined to gradually raise the
shareholder return target for Phase 2 and later.
Japan with non-Japanese staff overseas. In addition, in order to attract talented human
resources, draw out the commitment of each individual, and allow them to realize their full
potential, we must not only make a profit, but as a public entity of society, we must also be
able to create new value, clearly positive for the world, and find fulfillment in our own lives.
This is also our responsibility as a listed company that continues to operate with funds
invested by shareholders.
We are now at the stage where we must change from being a member of “Japan. Inc.”
to a “resilient global enterprise” that continues to grow within the world. We have not yet
reached that point, but we have the potential. We believe that the transformation of the
company over the next few years will determine the growth of MOL in the global arena.
We would like to sincerely ask shareholders and other stakeholders for their continued
understanding and support.
The Group, which will celebrate its 140th anniversary next year, has long expanded its
business scale along with the development of the Japanese economy. The basic business
style we have established along the way has been to build and manage an organization that
provides the best possible service to Japanese customers. The “Japan Inc.” model of a well-
trained, homogeneous staff working as a team, helping each other, was one of our winning
patterns.
To create a company that can grow and develop in the global market while facing
environmental challenges, we are moving away from this business style and management
that relies on such winning patterns. The success or failure of such a change will depend on
a strong promotion of diversity, equity, and inclusion. We must stir up the entire organization
and change the corporate culture by inclusion of multinational human resources, including
those at the senior management level, active promotion of female staff to executive positions
previously held predominantly by male staff, and mutual replacement of Japanese staff in
Aiming to Transform from the Previous “Japan Inc. Model”
to a “resilient global enterprise”
A Message to Stakeholders
P14
01 Value Creation Story
02 BLUE ACTION 2035
03 Corporate Governance
04 Corporate Information
Contents/Editorial Policy
7
MITSUI O.S.K. LINES
MOL REPORT 2023
Marine
Transport
Market
Driven
Business
Stable
Revenue
Business
Non-marine
Transport
Outcome
Fiscal 2022 Results
Fiscal 2022 Results
Vision for 2035
Financial KPI
Financial KPI
Target for Fiscal 2025
Non-Financial KPI
Non-Financial KPI
Profit before tax
Profit before tax
GHG emissions intensity reduction rate
GHG emissions intensity reduction rate
4 ZEROES*3
4 ZEROES*3
Percentage of women in managerial
positions (Land-based workers, non-
consolidated)
Percentage of women in managerial
positions (Land-based workers, non-
consolidated)
Percentage of MGKP*4 incumbents
Conversion rate to value
creation and safety work
Conversion rate to value
creation and safety work
Net gearing ratio*2
Net gearing ratio*2
ROE
ROE
¥819.1
¥400.0
1.01
0.9–1.0
(Compared to 2019) - 5.0
(Compared to 2019) - 45.0
9.2
4.7
18.3
9.5
—
30.0
49.8
9–10
billion
billion
%
%
Unachieved (One fatal accident)
Achieve
Women
Non-HQ
Under 40s
%
%
%
%
Percentage of MGKP*4 incumbents
15.0
8.0
30.0
15.0
Women
Non-HQ
Under 40s
%
%
%
%
%
%
%
Value Creation Model
Advancing various
social infrastructure
businesses centered on
marine transport
Realization of the MOL Group Vision
Business Fields
Code of Conduct
Corporate Management Plan
Underlying Profit, Investment, Financial Plan, and Shareholder Return Policy
Our Activities
Output
Environment
Environment
Safety
Safety
Human resources
Human resources
DX
DX
Input
With a world-class fleet of
approximately 800 vessels, we have
a track record of safely and stably
transporting a wide range of goods
and energy round the globe for
approximately 140 years as a full-
line marine transport company.
Strong Partnerships and Relationships
of Trust with Customers and Society
Global Network and
Diverse Group Companies
Strong Financial Base to Ensure Steady
Performance of Long-Term Contracts
(as of the end of fiscal 2022)
Clients: Approx. 3,000 companies
Mid- to long-term chartered vessel
owners for major ship types:
Approx. 120 companies
Participation in the World Economic
Forum
Group employees: 8,748
Group companies: 509
Overseas bases:
44 cities in 31 countries
Equity ratio:
54%
Free cash flow:
¥267.9 billion
R&I (Issuer rating):
A- (Positive)
JCR (Long-term issuer rating):
A+(Stable)
Reinvestment and the accumulation of knowledge
Environment
Safety &Value
Governance
Innovation
Human &
Community
Sustainability Issues (Materiality)
P11
P28
*1 An equity-method affiliate responsible for the management of the containership business
*2 The amount of interest-bearing liabilities is assumed to include off-balance assets (approx. ¥900.0 billion) such as charter-hire payment liabilities
that should be factored-in after IFRS is adopted.
*3 4 ZEROES = Zero for serious marine incidents, oil pollution, fatal accidents, and serious cargo damage
*4 MOL Group Key Positions, designated as equivalent to General Manager in Head Office, to be appointed and managed centrally across the group
* Set a new target by the end of fiscal 2025
BLUE ACTION 2035
Number of MOL voyages completed
Approx. 3,200
(Excluding voyages conducted by time
charter-out vessels)
Iron ore transport volume
Approx. 62.0 million tons
LNG transport volume
Approx. 73.0 million tons
Number of automobiles transported
Approx. 3.1 million units
Container transport volume by
Ocean Network Express*1
Approx. 11.1 million TEU
Total floor area of DAIBIRU-Owned
properties
Approx. 690,000 m2
(as of the end of fiscal 2022)
01 Value Creation Story
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MOL REPORT 2023
Business Overview
Shipping
Dry Bulk Business
Tanker Business
Liquefied Gas Carrier Business
Containership Business
Car Carrier Business
We have ships and vessels of various sizes, from small to
ultra-large-sized bulk carriers, depending on the volume
of cargo and the scale of the port of call. While flexibly
responding to various trades around the world, we provide
high-quality transportation services for a wide variety of
dry cargoes ranging from resources such as iron ore, coal,
wood chips, and biomass fuels to intermediate goods and
products such as fertilizer, grain, cement, salt, and steel.
Tankers are in service around the world depending on the
characteristics of the cargo they transport, including large
crude oil tankers, product tankers for transporting refined
petroleum products such as gas oil and gasoline, and
chemical tankers and methanol tankers for transporting
liquid chemical products. In addition, this business has the
characteristics of both market driven and stable revenue
businesses.
Demand for liquefied natural gas (LNG) has been rapidly
increasing around the world as an environmentally friendly
and clean energy source. Since participating in LNG
transport in 1983, we have accumulated considerable
expertise in this field, and boast the world’s leading share in
the ownership, management, and operation of LNG carriers.
We have also entered the business of transporting ammonia,
which is attracting attention as a next-generation clean fuel
that does not emit CO2 when burned.
Ocean Network Express, established through the merger
of the liner container shipping businesses of the three
Japanese shipping companies including MOL, boasts the
seventh largest fleet in the world and has built a network
of over 120 countries worldwide. The company supports
the global supply chain by transporting a wide variety
of cargoes such as furniture, clothing, groceries, and
electrical appliances in standardized cargo containers.
Car carriers are designed to efficiently transport self-
propelled cargoes ranging from passenger cars to
construction machinery, and can transport approximately
5,000 passenger car equivalent units per vessel. The
Company offers stable transportation services by precisely
meeting the diversified transportation needs of automobile
manufacturers. We are also actively working to reduce our
environmental impact by reducing wind resistance and
ordering LNG-fueled vessels with lower GHG emissions.
Market Driven
Business
Market Driven
Business
Market Driven
Business
Market Driven
Business
Stable Revenue
Business
Stable Revenue
Business
Stable Revenue
Business
Fleet Sizes of the Major Shipping Companies(Numbers of vessels, all vessel types)
Note: Prepared by MOL based on information disclosed by respective companies
(Number of
vessels)
MOL
NYK
MSC
Oldendorff
CMA
-CGM
BW
APM
-Maersk
China
COSCO
Capesize bulker
“JASPER DREAM”
Methanol tanker
“MANCHAC SUN”
LNG carrier
“LNG JUNO”
Containership
“ONE TRUST”
(As of May 2023)
Car carrier
“ORCA ACE”
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04 Corporate Information
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MOL REPORT 2023
Business Overview
Non-Shipping
Offshore Businesses
Terminal and Logistics Businesses
Ferries and Coastal RoRo Ships Business
Real Property Business
Cruise Business
Leveraging our experience accumulated in the energy transportation field, we are concentrating
investment on not only conventional marine transportation but also offshore businesses that are
expected to grow further in the future, such as FPSOs, FSRUs, and Powerships. By expanding our
business domain in the energy value chain, we will further broaden our role and meet the global
demand for energy.
The Company operates self-operated terminals, which play a key role in the container transport value chain
both domestically and internationally, and has developed a comprehensive port business. In the logistics
business, which spans a network of 268 bases in 26 countries around the world, in addition to diverse
logistics services, we provide one-stop services including optimal transportation using various types of
vessels and land transportation to meet a wide range of needs for heavy and oversized cargo transportation.
We operate a ferries business that transports passengers, passenger cars, and freight vehicles (trailers,
trucks, etc.) together, and a coastal RoRo ship business that specializes in the transport of freight vehicles.
We play an indispensable role in transporting industrial raw materials, industrial products, foodstuffs, and
other goods by connecting important bases with the largest sea and land transportation network in Japan.
With DAIBIRU CORPORATION at the core of its business, the Company manages numerous premium
office buildings mainly in Tokyo and Osaka, and is also expanding overseas by leveraging the know-how
and Group resources accumulated through its domestic business. With its business characteristics and
market cycles that are different from the marine transport business, the real property business helps
reduce volatility in the Group’s business performance and contributes to stable earnings.
In the cruise business, we offer a wide variety of cruise ship services, from casual one-night
cruises to cruises around the Japanese archipelago and overseas cruises, with a wide variety of
days, ports of call, and themes. In the future, we aim to expand the scale of our fleet and develop
international and high-quality services based on new concepts.
Stable Revenue
Business
Stable Revenue
Business
Stable Revenue
Business
Stable Revenue
Business
Stable Revenue
Business
World’s Largest FSRU
“BAUHINIA SPIRIT”
Special Feature:
Offshore Wind Power
Generation-Related Businesses
Logistics business network is
published in the data book “Investor
Guidebook” for investors.
P25
Challenges of the Overseas Real Property Business
Cruise Fleet Development Plan
While DAIBIRU CORPORATION has maintained stable management
in Japan to date, it is working to expand its overseas business for
further growth, and currently owns and operates three office buildings
overseas. Completed in Sydney, 275 George Street (right photo) is the
first overseas project in which DAIBIRU CORPORATION was involved
from the development stage. DAIBIRU CORPORATION has taken a new
step forward by becoming a wholly owned subsidiary of the Company
in 2022. By further leveraging the Group’s network and financial base,
we aim to further strengthen our overseas business.
Currently deployed in an LNG import project in Hong
Kong. In June, the plant became the first in Hong
Kong to accept LNG in its commissioning. After the
start of commercial operation, the gas will be
supplied to power plants in Hong Kong.
Purchase of existing cruise ship : 1 ship (to be in service by the end of 2024)
Newly built ships
: 2 ships
(first ship to be completed around 2027)
Photo provided by Ørsted
“Investor Guidebook 2023”
P23
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MOL REPORT 2023
Vision for BLUE ACTION 2035
In fiscal 2017, we introduced a rolling management plan, the Rolling Plan, and have been working to
improve our financial position and transform our business portfolio toward our vision for 2027.
During the process, we revised our Group Corporate Mission and Group Vision in April 2021
to reflect our expansion into business areas beyond transportation. In addition, as a result of the
strong performance of each business of the MOL Group, including the containership business, from
fiscal 2021 onward, we have achieved our initial financial targets for fiscal 2027 for the second
consecutive year, and our financial position has rapidly improved.
To leap forward to become a global social infrastructure company, we have re-conceived and
set the next stage, and formulated a new group management plan BLUE ACTION 2035 to show the
roadmap to our ideal state based on our long-term strategy. As we live in an era of rapid change, we
believe it is necessary to imagine the medium- to long-term future and then backcast from there to
define a plan and steadily implement various actions for changes from the ground up. We have also
set the target year of 2035, consistent with our environmental strategy, which sets milestones for
the introduction of net-zero emission vessels and GHG emissions intensity reduction targets.
BLUE ACTION 2035 combines elements of the Rolling Plan and the MOL Sustainability Plan,
both of which have been promoted in parallel, and expresses our sustainability management even
more strongly. The Group’s sustainability management is based on a long-term strategy to achieve
sustainable growth that is acceptable in terms of social issues and the environment. In addition to
the three financial KPIs, five non-financial KPIs have been established in the Core KPIs that measure
the degree of achievement of the management plan.
In addition, BLUE ACTION 2035 sets forth the goals of “transforming the portfolio into a
profitable one, even during weak shipping markets” and “achieving a balance between growth
investment and fulfilling our shareholders’ expectations (ROE of 9.0-10.0%).” Specifically, we aim to
achieve a business scale of ¥400.0 billion in profit before tax and ¥7.5 trillion in total assets, and an
asset ratio of 40:60 based on two classifications of businesses: the market driven business and the
stable revenue business. In line with our group vision to develop social infrastructure businesses
centered on the shipping businesses, we will further invest in non-shipping businesses as a new
growth driver, while developing the strengths of the shipping businesses.
Group Vision for 2035
We will develop a variety of social infrastructure businesses in addition to
traditional shipping businesses, and will meet evolving social needs
including environmental conservation, with innovative technology and services.
MOL group aims to be a strong and resilient corporate group that
provides new value to all stakeholders and grows globally
Targets
FY2022 Results
Phase 1
FY2025
Phase 2
FY2030
Phase 3
FY2035
Financial
KPIs
Profit before tax
¥819.1 billion
¥240.0 billion
¥340.0 billion ¥400.0 billion
Net gearing ratio*1
1.01
0.9 –1.0
ROE
49.8%
9–10%
Non-financial
KPIs
Environment
GHG emissions intensity
reduction rate
(Compared to 2019)
-5.0%
-
-
-45%
Safety
4 ZEROES*2
Unachieved
(One fatal accident)
Achieved
Human
Capital
Percentage of women in
managerial positions (Land-based
personnel, non-consolidated)
9.2%
15%
(Reset by the end of Phase 1)
Percentage of MGKP*3
incumbents
(Female/Non-HQ/Under 40s)
4.7%/18.3%/9.5%
8%/30%/15%
DX
Conversion rate to value
creation and safety work
(cumulative)
-
10%
20%
30%
Profit before tax trend by business segment
Dry Bulk Business
Energy Business
Product Transport Business
Wellbeing & Lifestyle Business
*1 The amount of interest-bearing liabilities is assumed to include off-balance assets (approx. ¥900 billion) such as charter hire
liabilities that should be factored-in after IFRS is adopted.
*2 4 ZEROES = Zeroes for serious marine incidents, oil pollution, fatal accidents, and serious cargo damage.
*3 MOL Group Key Positions, designated as equivalent to General Manager in Head Office, to be appointed and managed centrally
across the group.
(¥ billion)
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MOL REPORT 2023
Portfolio Reform
In BLUE ACTION 2035, we aim to raise company-wide ROA (profit before tax divided by total assets*)
to 5.3% by fiscal 2035. This is a higher-level setting than the financial targets set in the Rolling Plan,
which requires the company-wide improvement of profit margin.
In this portfolio reform, we categorize each business into the market driven business and the
stable revenue business, and control asset allocation based on the target ROA for each business.
The market driven businesses are defined as those with relatively short contract terms and high-
performance correlation with the volatile shipping market, specifically the containership business
and the car carrier business, and a portion of the dry bulk and tanker business. Through two
structural reforms, we have focused our efforts on reducing market exposure and have secured
stable profits that are not excessively affected by shipping market fluctuations. Building on this
foundation, we will enhance our business model to one that still allows us to gain high returns
when shipping markets are favorable by strategically taking market exposure in our market driven
businesses, thus improving profits across the company.
On the other hand, businesses with relatively long contract terms that are not affected by shipping market
volatility and non-shipping businesses that are affected by market conditions different from those of the
shipping market are collectively defined as businesses with stable revenue. We aim to expand our operations
by accelerating investment in the low/decarbonization energy business, which is expected to have high growth
potential, and the real property business and logistics business, which have been our focus businesses since
the Rolling Plan.
By expanding the stable revenue business while increasing the market exposure of the market driven
business, we expect the stable revenue business to serve as an anchor to support the Group’s profits even
when the shipping market is weak and the market driven business is in the red for a period of time.
Market Driven Business
Stable Revenue Business
Field
Our Business
Correlation with shipping market
Shipping
Containership, Car Carrier
Market Driven Business
(Highly correlated)
= High volatility
Dry Bulk, Tanker
Stable Revenue Business
(Low correlation)
= Low volatility
Liquefied Gas Carrier
Non-Shipping
Offshore Business, Offshore Wind Power,
Alternative Fuel Business, Logistics,
Real Property, Ferries, Cruises
Portfolio Strategy ( P17)
Environmental Strategy ( P22)
Regional Strategy ( P27)
* In addition to total assets under Japanese GAAP, this is the sum of lease contracts and other assets that are off-balance under Japanese
GAAP but are required to be on-balance under International Financial Reporting Standards.
Market Driven: Stable Revenue
Asset ratio in FY2035 40:60 (Profit ratio 60:40)
Market Driven Business
Stable Revenue Business
(Reference) Shipping: Non-Shipping
Asset ratio in FY2035 60:40 (Profit ratio 70:30)
Shipping
Non-Shipping
Asset Ratio [Market Driven: Stable Revenue] Trend (¥ billion)
Asset Ratio [(Reference) Shipping: Non-Shipping] Trend (¥ billion)
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MOL REPORT 2023
For BLUE ACTION 2035, we plan to set ROA for each business segment as an indicator for business
portfolio management, and to change the individual investment criteria to meet them. By doing
so, we aim to achieve a balance between the expansion of profit scale and improvement of capital
efficiency, and to achieve ROA that exceeds the ROA Cost of Capital as a whole.
In many of the Group’s businesses, financing is tied to each asset. The profitability evaluation
at the time of investment decision also employs profit/loss after interest, and tax strategies are
formulated to achieve overall optimization, including tonnage taxation.
For these reasons, among others, profit before tax after interest is used as the numerator.
By including assets such as chartered and leased vessels, which are currently off-balance sheet
assets, in the denominator of total assets, we can evaluate actual returns on invested capital.
By transforming our portfolio so that company-wide ROA exceeds ROA Cost of Capital, we aim to
achieve our targets for the three financial KPIs set forth in BLUE ACTION 2035: profit before tax, net
gearing ratio, and ROE.
For BLUE ACTION 2035, we have created an asset rebalancing plan that balances risk-taking through
investment expansion with the stability to maintain profitability even during shipping market recessions,
while taking into account the growth potential and environmental strategy of each business.
Looking back at the pre-pandemic period from fiscal 2015 to fiscal 2019, the performance of
containerships, car carriers, and dry bulk, which we classified as market driven businesses, was
sluggish, and the scale of stable revenue businesses was also small, the business portfolio was highly
volatile relative to the size of the Group’s overall profit and loss.
Given this, the rebalancing plan aims to build a company-wide portfolio that balances profitability
and volatility by expanding the scale of businesses with stable revenue and improving the profitability of
market driven businesses. Although the fluctuation of the Group’s profit and loss will be slightly larger
than before resulting from the increased volume of assets in the market driven businesses, with the
support of the expanded profit from the stable revenue businesses, we aim to decrease the volatility of
the Group’s financial performance and make the Group’s profitability exceed its ROA Cost of Capital.
ROA and ROA Cost of Capital
Rebalancing Plan
Long-Term Megatrend Analysis
The business environment surrounding the Group is changing rapidly. In BLUE ACTION 2035, we
conducted a long-term megatrend analysis looking beyond 2035 to 2050, and analyzed how long-
term changes in the macro external environment would affect the Group’s business environment.
The results of this analysis are used to formulate key strategies through 2035 for our BLUE ACTION
2035.
Key points of the long-term megatrend analysis
Long-term changes in macro external environment
Impact on our group’s business environment
Slow growth in global economy
Slow growth in demand for transportation
Countermeasure to climate change
Energy shift (progress in electrification: increase
of renewable energy)
Advances in technology
Strengthening environmental regulations
Development of circular economy and
local production for local consumption
Improved energy efficiency, shrinking demand for
fossil fuel
Population growth/
Change in population percentage in regions
Shift in the center of gravity of economic growth
Increased geopolitical risks
The rise of protectionism
Rebuilding the supply chain
Change and diversification of people’s values
Growing share of intangible service consumption in
economic growth
People’s shift from quantitative wealth to qualitative
affluence
Expansion of impact investments
R e t u r n
C o s t
ROA
(%)
ROA Cost of
Capital
(%)
Profit before tax
WACC
(Net debt +
shareholders’ equity)
Interest expense
Definition
Definition
Total assets
(1-Tax)
Total assets
Total assets
=
=
×
-
Capital cost before tax
Deduct interest expense
Convert to a total asset basis
Calculate the company-wide ROA Cost of Capital based on the formula above.
ROA targets for each business segment are allocated so that the company-wide ROA
exceeds the company-wide ROA Cost of Capital.
Please also refer to A Message from the CFO (P14).
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MOL REPORT 2023
A Message from the CFO
Hisashi Umemura
Director, Managing Executive Officer
Chief Financial Officer (CFO)
In fiscal 2022, ended March 31, 2023, MOL posted profit attributable to owners of parent of ¥796.0
billion, surpassing fiscal 2021 profit and reaching a record high. As a result, shareholders’ equity
increased to ¥1,925.3 billion and we were able to pay a dividend of ¥560.0 per share.
From a financial standpoint, the Company is sufficiently sound to implement every strategy under
BLUE ACTION 2035.
“We shall continue to achieve ROE that exceeds the cost of capital, thereby increasing shareholder
value.” This is a commonplace statement that has always been uttered. However, many Japanese
companies are now required to seriously address this proposition. To this end, it is necessary
to exercise investment discipline and create a system that prevents reckless and unprofitable
investments and to realize this, we practice management with ROA and ROA Cost of Capital. Of
course, when entering a new business or a new geographic area, especially in the non-maritime
sector, our cost competitiveness may fall behind the market level at the initial stage. In these
cases, we may have to make a big-picture decision to justify low profitability in an individual project.
However, even in such a situation, we need to make decisions judiciously after considering whether
the initial low profitability will truly lead to future business expansion and whether the Company can
survive in that business area. As CFO, I will fulfill my responsibility in securing the soundness of this
decision-making process of investment and increasing corporate and shareholder value.
As a new shareholder return policy in Phase 1 (from fiscal 2023 to fiscal 2025) of BLUE ACTION 2035,
we have adopted a dividend payout ratio of 30.0% and a minimum dividend of ¥150.0 per share.
Although we have raised the dividend payout ratio to 30.0% from the planned 20.0% in fiscal
2021 and 25.0% in fiscal 2022, we recognize that it is still below the average of the Tokyo Stock
Exchange’s Prime Market. However, looking at the current situation of our business, particularly the
shipping industry, from a high-level perspective, we believe that it is imperative to take the first steps
toward decarbonization, win the trust of our customers, and ensure the growth of our
decarbonization-related business. In Phase 1, we hope it is understood that our cash allocation will
be focused on investment giving priority to expand these business opportunities.
Fiscal 2022 Review
Increasing Corporate and Shareholder Value Through BLUE ACTION 2035
Shareholder Returns
We will flexibly make
the necessary investments
for growth and
environmental responsiveness,
while striving to
continuously enhance
shareholder returns.
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MOL REPORT 2023
and since the shipping industry is a market-driven industry and profit growth cannot be achieved
in a steady and uninterrupted manner, we believe that taking measures that directly contribute to
ensuring earnings stability, i.e., expanding the stable revenue business, is a better direction at this
point. The problem with our stock valuation is the low P/E ratio, and to overcome this situation, we
will have to enhance the quality and stability of our profit, and our groundwork to ensure that “we
can earn a certain level of profit under any circumstances, even when the market is weak.” Based on
this belief, we do not promise to buy back shares during the Phase 1 period but rather position it as
a case-by-case decision as a means of capital control if our capital builds up beyond expectations. Of
course, we are fully aware of the message having in share buybacks that they are proactive actions
by the company when the share price is undervalued.
At the same time, it is important to show short-term results while continuing to invest for mid
to long-term growth. During the challenging times of the 2010s, we wiped out unrealized losses
on assets and contracts while making progress in managing exposures in each business area.
As a result, we are confident that even after the containership business, which was the source of
our strong performance over the past two years, returns to its normal, the contributions of other
segments have led to laying the foundation to secure a certain level of overall profitability. The
impact of the booming containership business in fiscal 2021 and fiscal 2022 was so great that the
situation of other businesses has inevitably become unremarkable, however, we have decided to
introduce a minimum dividend of ¥150.0 per share to visibly show our confidence in our performance
during Phase 1 and to reassure our shareholders.
Many shareholders and investors have asked us, “Why don’t you buy back your own shares?” If
the essence of the share buyback is to maintain and improve EPS (earnings per share), we believe
that this can be fully achieved through profit growth based on the normal investment-recovery cycle,
Cash Allocation in Phase 1 (FY2023 to FY2025)
Shareholder Return Policy in Phase 1 (FY2023 to FY2025)
Cash-in
Investment Breakdown
Investment Aligned with
Environmental Strategy
Cash-out
External Financing
billion
Cash Flows from
Operating Activities
billion
Asset Replacement
billion
Dividend
billion
Market Driven
billion
Reduction of our Group’s
GHG Emissions
billion
Low/Decarbonization
Energy Business
billion
Stable Revenue
billion
Investment
billion
Leverage external funds
while controlling
Net Gearing Ratio
Periodical
review subject to
the progress of
BLUE ACTION
2035
Increase payout ratio from 25% to 30% as
well as set ¥150 of minimum dividend
Consider additional shareholder returns
subject to the business environment
Continue asset replacement
and cash generation
Stable generation of
¥250 billion or more of
Cash Flows from Operating
Activities every year
Dividend per share
(Yen per
share)
(FY)
Payout ratio
*This figure is converted after the 3-for-1 stock
split of common shares executed on April 1,
2022.
(Minimum: ¥150)
Policy in Phase 1 of BLUE ACTION 2035
Payout ratio: 30%
Minimum dividend: ¥150.0 per share
Potential share buybacks subject to business environment
Policy in Rolling Plan 2022
Payout ratio: 25%
Ideas behind return policy
Promote active investments with accumulated profits, which will lead to profit expansion and corporate value increase.
Increase payout ratio to 30% and return the outcome of growth to shareholders.
Introduce minimum dividend to prevent underpayments even if lower shipping market cycles occur.
When profits exceed original expectations, capital controls such as additional shareholder return may be implemented with 9-10%
of ROE target in mind.
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MOL REPORT 2023
We have organized an in-house expert team to implement the International Financial Reporting
Standards as soon as possible after the completion of Phase 1. The shipping industry, which is
the core of our business, is competitive in the single world market, and we are also looking to
expand our non-shipping businesses in overseas markets. We would like to adopt the IFRS as soon
as possible, as different accounting standards make it difficult to make comparisons with global
competitors.
In addition, even before the introduction of the IFRS, we will strive to enhance the information
disclosed to shareholders and investors and improve the quality of dialogue by disclosing our own
estimates of the financial impact of time charter contracts and operating lease contracts, which are
off-balance sheet under the Japanese GAAP, based on the same approach as under the IFRS.
As CFO, I am in charge of the Finance Division, the Accounting Division, and the Corporate
Communications Division. In addition to shareholders and investors, we have a variety of stakeholders
in Japan and overseas, including financial institutions represented by commercial and investment
banks, auditing firms, and accounting consulting companies. In the past, as long as we were engaged
in traditional price competition with a limited number of competitors in the closed world of the shipping
industry, where change is limited, perhaps a point-to-point relationship in a specific area such as
financing or bond issuance would have been acceptable. However, the competitive environment itself is
changing in all industries, such as calls for decarbonization and DE&I, and we are working to change
our business structure in this context. There are limits to what one company can do and what one
company can know, so it is also my important responsibility to enhance cooperation with these domestic
and international partners in the financial sector. I look forward to your continued support.
Introduction of International Financial Reporting Standards (IFRS)
Together with Domestic and Overseas Partners
Background on Using ROA and ROA Cost of Capital
While return on invested capital (ROIC) is a widely known method for managing investment
efficiency, we have chosen to use ROA and ROA Cost of Capital for the following reasons.
Due to the business structure, some of the core businesses are recorded as equity in earnings
of affiliates, so, the operating profit base is not suitable.
Recognize extraordinary profit and loss resulting from the replacement of assets, including
ships, that occur in business operations.
As a capital-intensive industry, the proportion of non-business assets is relatively small, and
there is little harm in using total assets as the denominator.
Although there are differences in the appearance of the formulas and the indicators
calculated, there is no difference in expressing the profit-generating capacity of the core
business in relation to the invested capital.
The specific calculation results for ROA and ROA Cost of Capital as of the end of March
2023 are as follows.
(Reference) ROIC = Operating profit after tax / Invested capital = Operating profit after tax / (Interest-bearing debt + Equity)
R e t u r n
C o s t
ROA
(%)
ROA Cost of
Capital
(%)
Profit before tax
WACC
(Net debt +
shareholders’ equity)
Interest expense
Definition
Definition
Total assets*
(1-Tax)
Total assets
Total assets
=
=
×
-
Capital cost before tax
Deduct interest expense
Convert to a total asset basis
Calculate the company-wide ROA Cost of Capital based on the formula above.
ROA targets for each business segment are allocated so that the company-wide ROA
exceeds the company-wide ROA Cost of Capital.
Profit before tax
¥819.1 billion
Total assets*
¥4,686.6 billion
ROA
17.48%
WACC
4.77%
Tax
28.70%
Net Debt
¥1,939.7 billion
Shareholders’ Equity
¥1,925.3 billion
Total assets
¥4,686.6 billion
Interest expense
¥17.3 billion
ROA Cost of Capital
4.91%
ROA
ROA
Cost of Capital
*Total assets under the Japanese GAAP plus lease contracts and other assets, which are off-balance sheet under the Japanese GAAP but required to be on-balance sheet under the International Financial Reporting Standards.
In some cases, when a company borrows to finance the construction of a ship, the company guarantees the financial obligations of the ship-owning company that is the borrower. If the ship-owning company is a consolidated
subsidiary, then the obligation is recorded as a liability on the Company’s consolidated balance sheet as a result of incorporating all of the subsidiary’s assets and liabilities. Under the Japanese GAAP, however, monetary
obligations owed by unconsolidated subsidiaries and affiliates are not recorded as liabilities regardless of whether they are guaranteed. On the other hand, under the International Financial Reporting Standards (IFRS),
guaranties are individually classified and determined whether these need to be recorded as the guarantor’s liability according to the likelihood that it will be obligated to make repayment on behalf of the guarantee. At this
time, we have not performed this classification process, and therefore, for convenience, we have treated all guaranties for monetary obligations owed by unconsolidated subsidiaries and affiliates as being included in the “off-
balance sheet liabilities” in the denominator of the ROA calculation. If we actually adopt IFRS, we will determine how to treat these guaranty obligations in the ROA calculation in parallel with the IFRS adoption process itself.
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Business Headquarters – Vision 2035
Portfolio Strategy
Taking into account the growth potential and the alignment with our environmental strategy for each business, we will proceed with
asset rebalance so that the profitability of the entire company exceeds the volatility, and achieves both risk taking through increased
investment and a business portfolio that can maintain profitability even during recessions in the shipping market.
We aim to become a global partner that supports society as a key infrastructure supplier for strong
and flexible marine transport by responding to changes in diverse industries and by mobilizing our
comprehensive transport management capabilities. We shall proactively capture the demand for biomass
fuels and nonferrous raw materials required for electrification, which will be created by the development
of a decarbonized and low-carbon society, as well as infrastructure and food-related cargo transportation,
which is expected to expand. We will also establish a system to earn high returns during shipping market
booms by dealing appropriately with changes in cargo demand, trade patterns, and shipping capacity
supply and demand, and by taking strategic market exposures through enhanced intelligence functions.
Dry Bulk Business
We will continue to transport energy as a social infrastructure supplier in a manner that meets the needs
of the times. We will focus on project-based businesses like the offshore business and the offshore wind
power generation business while aiming to become a growth driver of the Group by continuously generating
stable profits throughout the value chain. In order to achieve this, we will define areas where we will be
aggressive and where we will be defensive as well as what we will begin, change or stop. That will allow us
to operate the headquarters in a highly convincing manner. We will promote cooperation with other business
headquarters and regional organizations to avoid partial optimization within the headquarters.
Energy Business
The car carrier business will enhance its competitiveness by providing a lineup of environmentally
friendly vessels that meet customers’ needs to reduce GHG emissions, and strengthen its resilience to
market fluctuations by rearranging its service network according to changes in cargo movements. The
containership business will maintain and pursue economies of scale by expanding its fleet of Ocean
Network Express vessels, and build further advantages by focusing on environmental and digital strategies.
The logistics business will shift to the offensive. In addition to organic growth that leverages the strengths
of the core companies, like the expansion of MOL Logistics’ global sales network and Utoc’s expansion
of heavy-lift logistics, MOL Logistics will also work on large-scale M&A in forwarding and expansion into
logistics real estate by leveraging synergies with DAIBIRU in order to achieve discontinuous growth.
Product Transport
Business
Amidst the rapidly changing business environment around the Group, the Wellbeing & Lifestyle Business,
a business headquarters with many stable earnings businesses such as real property, ferries, and
cruises, will make timely investments by leveraging its strong financial base to support the sustainability
of its business. We are committed to a customer-oriented spirit and a steady refinement of safe and
reliable operations, and earn the trust of society as well as our customers. We aim to enhance the
sustainability of our business and become an indispensable presence in improving corporate value.
Wellbeing &
Lifestyle Business
Tanker
Dry bulk
Containership
PCC
ROA/Volatility
Ferry, Cruise
Logistics
Overall
Real property
Liquefied Gas
Carriers Offshore
Return
(ROA)
Volatility
Tanker
Logistics
Overall
Real
property
ROA資本コスト
The profitability of
Containerships, Car Carriers
(PCC) and Dry Bulk is
improved notably but asset
increase is relatively restrained.
ROA Cost of Capital
Return
(ROA)
Ferry, Cruise
Dry bulk
Containership
PCC
Liquefied Gas
Carriers Offshore
Asset increment in
Liquefied Gas Carriers,
Offshore Business and
Real Property is higher than
others.
Volatility
ROA/Volatility
Diagram - before and after rebalancing in terms of profitability and volatility
FY2015-2019 (Before COVID)
FY2035
*The size of the circle indicates the amount of total invested assets.
Also refer to Overview of Operations by Business Headquarters (P18–21).
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MOL REPORT 2023
Dry Bulk Business
Position and Main Differentiating Factors
Capesize
bulkers
vessels
vessels
(As of March 31, 2023)
Small- and medium-
sized bulkers
vessels
Panamax
vessels
Handymax
vessels
Handysize
vessels
Multipurpose
cargo ships
vessels
Wood chip
carriers
vessels
Overview of Operations by Business Headquarters
Opportunities
Risks
Fiscal 2022 Achievements
Market Environment Analysis
Fleet Breakdown by Vessel Type
Revenues and Ordinary Profit (loss)
Assumed changes in the business environment
(the Company’s forecast)
Change in ocean cargo movement (Movement in 2022=100)
Highlight
Although market conditions were weak compared to the previous year, MOL Drybulk and equity-method affiliate Gearbulk Holdings posted strong results, and the iron ore and coal
transport business increased profits, supported by stable margin from term contracts. The dry bulk business is thought to be market driven, but it consists of diversified business
models, including small- and medium-sized bulkers, which are market driven, and iron ore and coal carriers and wood chip carriers, which are stable revenue, as well as multi-
purpose bulkers, which are niche businesses, and this is the result of solid efforts even when the market was sluggish. In the environmental strategy, a pillar of our business strategy,
we are steadily advancing efforts to reduce GHG emissions by adopting Rotor Sail and Wind Challenger, which utilize wind power as propulsion, and signing contracts to build LNG
dual-fuel cape-size bulkers, while strengthening our transportation of biomass fuel, wind power generation components, and other cargo that supports a decarbonized society. In our
regional strategy, another pillar of our business, we are strengthening our sales in China, Southeast Asia, and the Indian Ocean, yielding positive results. The situation surrounding
the company is changing at a pace faster than expected, but we are working to respond to changes in the business environment in a “strong and resilient” manner.
The Dry Bulk Business has been in contact with various industries and has provided high-quality solutions suited to their transportation
businesses. These include contract know-how as per transportation mode, types of cargo, port and cargo handling conditions, and
maritime technical capabilities to ensure safe voyages in any sea weather, technological capabilities as represented by the Wind
Challenger, and proposal-based sales with intelligence and a forward-looking view of the market. These comprehensive transportation
management capabilities have been refined based on long-term relationships of trust with our customers, and we are confident that
we can provide solutions to the changing needs of society and customers in the wake of decarbonization ahead of our competitors. We
also believe that we can fully utilize our experience and expertise as a comprehensive shipping company in dealing with new fuels for
environmentally friendly ships. In recent years, the quality standards for shipping and transportation demanded by major overseas
customers have become extremely high. We will further raise the standards in terms of both hardware and software not only for our
own vessels but also for chartered vessels, aiming to be the first choice of our customers as a partner.
(Short-term) Limited pressures to supply newly built vessels. Selection of operators
will become stricter due to quality and environmental requirements.
(Long-term) Creation of new transport demand and changes in supply chain
caused by decarbonization. Population growth in emerging economies
causing changes in trade structure.
(Short-term) Economic stagnation in China and persistently high energy costs
leading to a decrease in cargo movement and a decrease in cargo to/
from Japan.
(Long-term) Disapearing demand for transportation of coal as major cargo,
replaced by liquid alternative fuels (hydrogen, ammonia), resulting in
reduced demand for transportation of dry cargo.
The decarbonization trend is accelerating mainly in
developed countries. Shipments of iron ore and coking coal
are on a gradual decline. Grain prices are steady due to the
increase in the world population.
On the other hand, the volume of overall dry bulk cargo
remains flat due to an increase in semi-finished products
and wood chips.
(¥ billion)
(¥ billion)
Revenues (left)
Ordinary profit (right)
(FY)
Cargo
2025
2030
2035
2050
Iron ore
98
90
85
68
Coking coal
101
100
96
85
Grain
112
120
127
151
Wood chip carrier “VANGUARDIA”
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Energy Business
Tankers
Crude oil tankers
vessels
Product tankers
vessels
Chemical tankers
vessels
Methanol tankers
vessels
Coastal ships
(excluding coastal RORO ships)
Service operation vessels (SOV) for offshore wind farms
SEP vessels vessels
vessels
vessels
vessels
vessels
FPSO
Steaming coal
carriersvessels
vessels
vessels
Others
Subsea support
vessels
Liquefied
gas carriers
vessels
LNG carriers
vessels
Ethane carriers
vessels
LNG bunkering vessels
vessels
-to-Power ships
vessels
FSUs and FSRUs
vessels
LPG and ammonia ships
vessels
Others
vessels
vessels
(As of March 31, 2023)
Opportunities
Risks
Fiscal 2022 Achievements
Market Environment Analysis
Fleet Breakdown by
Vessel Type
Revenues* and Ordinary Profit
Highlight
We were able to achieve results due to the tailwind of market conditions, steady execution of operations in each business area, and continued safe ship operations. In
particular, the methanol tanker and chemical tanker businesses delivered good results due to favorable market conditions and strong demand, while the LNG carrier
business supported profits in an environment of heightened awareness of energy security and changes in supply and demand.
In the steaming coal transportation business, the first vessel equipped with a Wind Challenger was completed and became a symbol of our environmentally friendly
vessels. As for our medium- to long-term strategy, we are making strategic moves to contribute to future profits by aggressively upgrading our fleet and securing contracts
in the shipping business, particularly for LNG carriers, while investing funds and human resources in the offshore business and offshore wind power generation business
ahead of others. Unfinished tasks include the promotion of new business projects such as FSRUs, Powerships, liquefied CO2 carriers, and offshore wind power generation,
as well as participation in the value chain from upstream to downstream of new energy sources.
(Short-term) Increasing global demand for LNG.A gap between robust demand for
new ships and shipbuilding capacity.
(Long-term) Introduction of new energy sources such as ammonia, hydrogen,
and synthetic methane. Change of supply and demand due to global
population growth. Spread of carbon recycling (CO2 separation and
recovery) use. Expansion of marine energy use.
(Short-term) Emergence of geopolitical risks. High energy pricescausing a slump in
new projects in emerging countries, soaring ship prices, and economic
slowdown.
(Long-term) Worldwide transition to a decarbonized society. Fragmentations of
nations and regions. Decline of goods and energy consumption.
(¥ billion)
(¥ billion)
Revenues (left)
Ordinary profit (right)
(FY)
Assumed changes in the business environment
(the Company’s forecast)
Change in ocean cargo movement (Movement in 2022=100)
With the exception of LNG, fossil energy cargoes will gradually
decline after 2030.
LNG will begin to decline after 2035 due to the decarbonization
trend.
Seaborne cargo movement of hydrogen, liquefied CO2, ammonia,
etc. will increase 2030 onwards.
Cargo
2025
2030
2035
2050
Crude oil
108
110
95
53
LNG
105
135
153
103
Steam coal
97
79
66
43
*Large parts of LNG carriers and offshore businesses are managed through equity-method affiliates, and those parts of revenues have not been included in the consolidated revenues
above.
Position and Main Differentiating Factors
Leveraging our challenging spirit and unwavering decision-making, we have expanded our LNG carrier business around the world, and
we have aggressively developed new business fields such as FSRU, FPSO, power generation vessels and FLNG, liquefied CO2 transport,
offshore wind power generation. With this organizational culture as a backdrop, we will work to expand our business by investing
upstream in the value chain in new energy sources such as ammonia and hydrogen, and in decarbonized fuels, to further differentiate
ourselves. We also believe that our strengths lie in our customer-first and partner-oriented approach, as well as our maritime and global
ship management capabilities.
Overview of Operations by Business Headquarters
LNG carrier “LNG ROSENROT”
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Product Transport Business
Car carriers
vessels
Containerships*1
vessels
vessels
(As of March 31, 2023)
Ferries and coastal
RoRo ships
vessels
Opportunities
Risks
Fiscal 2022 Achievements
Market Environment Analysis
Fleet Breakdown by Vessel Type
Revenues*2 and Ordinary Profit
Highlight
As in the previous fiscal year, profits hit a record high level, largely due to equity in earnings of Ocean Network Express (ONE), but other businesses also accurately
grasped the wave of favorable market conditions and produced results. It was a year of steady progress on the three strategies in our management plan, including
environmental initiatives such as car carriers, and efforts to transform our portfolio through the expansion of our logistics business, including MLG and Utoc, companies
which turned into wholly owned subsidiaries. The Product Transport Business’s unique feature and strength is that it has a multitude of businesses with different
profitability and volatility: car carriers and containerships in the shipping business, and terminal and logistics in the non-shipping business. In FY2023, we will continue
to play a major role in achieving a rebalance in the business portfolio of the company as a whole, and we shall continue to manage our operations by balancing risk and
numbers while monitoring the status of each business and its correlations.
(Short-term) Recovery of emerging economies, especially Asian economies,
from a sharp drop caused by the COVID-19 pandemic, increasing
opportunities for expansion in car carrier and logistics businesses.
(Long-term) Acceleration of business structure change and industry restructuring
due to the spread of awareness of a sustainable society and the
progress of digitization.
(Short-term) Direct setbacks to the global economy, including the Ukraine conflict
and financial instability
(Long-term) Long-term decline in transportation demand, such as slowdown in
containerized cargo growth due to the headwind of globalization
expansion and slowdown in completed car cargo movement due to
the progress of local production for local consumption
(¥ billion)
Revenues
Ordinary profit
(FY)
Assumed changes in the business environment
(the Company’s forecast)
Change in ocean cargo movement (Movement in 2022=100)
As economy grows, demand for goods will remain strong until
around 2035.
In the long run, maritime cargo growth will be slower than
the pace of economic growth due to local production for
local consumption (slowing globalization) and technological
innovations such as 3D printers.
Cargo
2025
2030
2035
2050
Automobile
109
111
120
118
Container
105
120
135
176
*1 All containerships are chartered to and operated by ONE.
*2 ONE, which is responsible for the containership business, is an equity-method affiliate. Therefore, the revenues of ONE have not been included in the above.
Position and Main Differentiating Factors
In the car carrier business, we are building a service network that will lead to the next generation by promoting fleet organization with
environmentally friendly vessels based on our world-class tonnage and long-term stable transportation contracts with major shippers.
ONE operates the 7th largest fleet and belongs to The Alliance, one of the three alliances in the industry, and the company’s strength lies in
its top-level cost competitiveness and high-quality customer service. In the logistics business, we turned MLG and Utoc into wholly owned
subsidiaries to promote the strengthening of group management in the logistics segment. MLG operates a wide range of businesses such
as air transport, marine transport and inland transport globally and has strong relationship with Japanese customers. Utoc has built boasts
over 130 years of experience with its solid technical capabilities, including expertise in heavy and long cargo. MLG and Utoc plays a leading
role in overseas markets and the Japanese market, respectively, to provide market-oriented cargo handling, storage, and transportation
services tailored to the needs of customers, especially Japanese companies.
Overview of Operations by Business Headquarters
Containership “ONE MAJESTY”
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Wellbeing & Lifestyle Business
Message from New Director General of Business Headquarters
Many of the businesses handled by this newly created business headquarters involves people. This is part of the MOL Group’s initiatives to grow businesses that go beyond
cargo transport, the mainstay of the Group, and to make them a stable earnings base. Our most urgent challenge is to launch a series of new luxury cruise ships in the
cruise business, which we have operated for nearly 30 years with the Nippon Maru at the center of our operations. While inheriting many of the positive aspects of the
Nippon Maru, we are working to develop attractive services utilizing these cruise ships by combining the knowledge and experience of the MOL Group with the expertise
of external specialists. Next, in the ferry business, the challenge is to consolidate the “Sunflower” brand, which has a 50-year history in both the east and west markets of
Japan, and to draw up a major growth strategy. This requires us to make the most of the various ties and associations we have cultivated over our nearly 140-year history,
as well as the relationships we have developed with customers and suppliers. We will work with a sense of urgency in close collaboration with new businesses, global
human resources recruiting business, and community-based tugboat and coastal shipping businesses that have long been rooted in various parts of Japan.
Managing Executive Officer
Director General of Headquarters of Wellbeing & Lifestyle Business
Tsunemichi Mukai
Business
Market Environment Analysis (opportunities and risks)
Position and Main Differentiating Factors
Real Property
Business
In addition to the long-standing concerns about the sharp rise in domestic
real estate prices and the decrease in the number of office workers due to the
declining birth rate, it is also more important than ever to provide offices that
meet the needs of customers in the post-COVID-19 era, in light of changing
values and behaviors, diversifying work styles, and increasing awareness of
sustainability, and accurate investment decisions will be required.
Daibiru’s accumulated expertise in the operation and construction of office
buildings is its greatest point of differentiation. In Japan, Daibiru has a
strong business base in Tokyo and Osaka, and is promoting redevelopment
in Sapporo. Overseas, the company owns office buildings in Vietnam and
Australia, and plans to expand the scale of its business by targeting Asia,
which is expected for a continuous growth.
Ferry and coastal
RoRo ship
business
In the short to medium term, domestic marine cargo transportation
demand will increase due to the modal shift caused by the 2024
problem*1. On the other hand, the long-term trend of domestic cargo
transportation demand needs to be closely monitored due to the
declining population. In addition, the possibility cannot be denied that the
next modal shift may occur due to technological innovation, such as the
practical application of EV trucks and autonomous driving.
We are leading the industry in environmental strategy with the introduction
of two LNG-fueled ferries, the first of their kind in Japan. Through the
merger of MOL Ferry Co., Ltd. and Ferry Sunflower Limited, we will
concentrate our management resources and focus on cargo transport, which
is expected to generate stable earnings, while refining the “casual cruise
concept”*2 to significantly increase passenger transport earnings.
Cruise
Business
The end of the COVID-19 pandemic and the return of the luxury cruise market
to a growth trajectory have provided growth opportunities for our cruise
business. Expecting our cruise services to be recognized and chosen by both
Japanese customers and inbound customers as a new vacation option.
Unlike major foreign cruise lines, which mainly offer large-scale services to the
Caribbean and prominent European destinations on large vessels, MOL’s cruise
services mainly utilize small vessels to visit ports in Japan. We provide high-
quality, authentic services that can be realized only because we are based in
Japan, and that allow customers to experience the true essence of Japan.
*1 There is concern about a possible shortage of transportation capacity due to overtime caps to be imposed on truck drivers effective April 2024.
*2 The Group proposes an elegant and comfortable cruise that can be enjoyed in casual clothes. (https://www.mol.co.jp/casualcruise-sunflower/)
Overview of Operations by Business Headquarters
“Corner Stone Building”
owned by Daibiru in
Vietnam
LNG-fueled ferry
“Sunflower Kurenai”
Cruise ship
“Nippon Maru”
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Environmental Strategy
The need to address environmental issues on a global scale, as manifested by GHG reductions, has created opportunities for new
businesses, and has also meant the addition of “environmental preservation” to the traditional needs of our customers (in the
shipping industry, safe operation with competitive freight rates, for instance), which is a different perspective than before. Our
environmental strategy is to promote efforts to address one of our Sustainability Issues (Materiality), “Environment - preservation
for marine and global environment,” and at the same time, to link this to the expansion of our business.
The number of customers who want to make their supply chains cleaner and promote GHG
reduction throughout the value chain of their products has steadily increased over the past few
years. And even if these trends sometimes come to a standstill, they will not stop as a major trend.
The strategy of using the reduction of GHG emissions from transportation services as a
differentiating factor itself is not new, as it is a direction that many shipping companies are pursuing.
However, in order to introduce new technologies for this purpose, it is necessary to establish and
implement a system that can reliably provide transportation services through strong relationships
with suppliers and partners at each stage, from concept creation, basic design, detailed design,
construction, and operation, and to have the financial resources necessary for these activities. In
addition, when collecting data to promote efficient operation, having a fleet size above a certain level
is itself an advantage.
MOL’s history of handling various types of vessels and working on numerous projects of high
technical difficulty has given us access to influential business partners and suppliers both domestically
and internationally. In addition, the booming containership market over the past few years has
provided us with a strong financial base that enables us to make aggressive new investments. By
leveraging these strengths and taking the lead in introducing technologies to reduce GHG emissions,
we aim to be recognized by our customers and become the leader of choice.
Various players, including major energy companies, are competing around the world in
wind and solar power generation sectors, as well as for green hydrogen and ammonia
production projects utilizing such renewable energy. MOL has three different business
activities: (1) transportation of such new energy, (2) transportation of materials and
personnel required for construction and
maintenance of production facilities, and (3)
consumption of new energy as marine fuel.
Taking advantage of this unique position,
we are working to make the low- and zero-
emission energy businesses sector a pillar of
future earnings, while sometimes investing
in production projects themselves.
Reduction of the Group’s GHG emissions
Expansion of low-carbon and decarbonization energy projects
Joined the First Movers Coalition* (FMC)
(Second from right: Takeshi Hashimoto, President and
Chief Executive Officer)
*A group of companies, sponsored by the World Economic
Forum, and established to stimulate demand for decarbonizing
technologies.
Wind Challenger Project
Site image - Clean Ammonia Production and
Transportation Project, Louisiana, USA
(¥ billion)
Already
decided
New
Subtotal
Reduction of the Group’s GHG emissions
190
160
350
Expansion of low-carbon and
decarbonization energy projects
190
110
300
Total
380
270
650
Investment in environmental strategies from FY2023 to FY2025
(cash-out basis)
Please visit the website for more information on
the Wind Challenger Project.
https://www.mol.co.jp/en/bam/001/
Please visit the website for more information on Clean Ammonia Production and Transportation Project.
https://www.mol.co.jp/en/pr/2023/23080.html
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Disclosure based on TCFD recommendations
We are conducting scenario analysis using the TCFD framework for the ultra-long-term range up to 2050, and are striving to understand a range of possible risks and opportunities posed by climate change
as well as proactively disclose information. In order to implement our environmental strategy and address sustainability issues in an integrated manner, we have developed a management plan consistent
with the scenarios we have analyzed and have incorporated climate change impacts into our business strategy.
The Environment & Sustainability Committee, a subordinate body of the Executive Committee,
attended by key executives, has been established to deliberate on issues related to overall
sustainability. After deliberations by the committee, important matters are reported, discussed,
and resolved at meetings of the Board of Directors and the Executive Committee.
In order to further strengthen the commitment of the executive team, the Company operates
a system in which director remuneration is linked to climate change-related results. Of each
executive director’s long-term target contribution-based remuneration, 30% reflects the
progress made in addressing climate change and other ESG-related issues.
In order to identify risks and opportunities associated with climate change from a long-term
perspective, understand the impact on our business, and incorporate appropriate measures into
our management plan, we conduct climate change-related impact assessments through analysis of
multiple scenarios, including the 1.5°C scenario, with 2050 as the target year.
Governance
Strategy (risk/opportunity)
Remuneration Structure (Model Remuneration Assuming Achievement of Performance Targets)
Fixed remuneration
Monthly remuneration
(cash)
Variable remuneration
60%
60%
Single fiscal year
performance-based
remuneration
(cash)
20%
Long-term target
contribution-based
remuneration
(stock)
20%
40%
Of this amount,
30% is linked to the
“medium to long-
term individual
contribution goal.”
The evaluation
will reflect the
progress of ESG-
related initiatives,
including
climate change
countermeasures.
Specific examples of
risks and opportunities
Impact Details
Transition risk
Rising carbon
prices
If the European Union Emissions Trading Scheme (EU-ETS) is applied to international shipping,
it is estimated that about ¥5.0 billion will be charged annually.
In addition to the substantive measures to reduce emissions through the introduction of
alternative fuel vessels described below, it is possible to mitigate the cost increase by reflecting
it in shipping rates in light of past business practices, therefore, the risk is not expected to be
significant.
Physical risk
Flood/typhoon
Although there is a possibility of a decrease in transportation volume due to the disruption
of supply networks caused by floods and typhoons, we believe the impact will be minimal, as
business risks are generally hedged through contractual arrangements such as time-charter
contracts and securing alternative routes.
Decrease in forest
area
Even if a fire were to occur in one region and reduce the forest area, which could result in a
decrease in timber cargoes, it would have minimal impact on the volume of transportation, unless
it occurs simultaneously around the world, since it is believed that another production area can
replace that forest area.
Rise in sea level
Due to the rise in sea level, there is a possibility that the draft restrictions at the port may be
relaxed, which could slightly increase the amount of cargo that can be loaded, but the impact on
the business will be small.
Opportunity
Introduction of
alternative fuel
vessels
We believe that the sequential introduction of LNG and ammonia/hydrogen-fueled vessels
will mitigate the impact of rising carbon and fuel prices, and conversely lead to a competitive
advantage in the low-carbon-oriented market.
Increased demand
for efficient operation
and energy-saving
equipment
We believe that by offering a comprehensive combination of our efficient navigation
technology and energy-saving know-how, we can gain a competitive advantage in the low-
carbon-oriented market.
New business
opportunities
associated with
clean energy
As new supply chains for clean energy such as offshore wind power generation, ammonia, and
hydrogen are established, we assume that we can find opportunities for new businesses anywhere
that have a high affinity with the expertise we have developed in our existing businesses.
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We also assess the quantitative impact on our business if each scenario were to materialize.
Specifically, we focus on our assessment of the following factors, which are considered to have an
impact on our business:
(1) Changes in cargo movements, (2) fuel costs, (3) carbon tax,
(4) introduction of alternative fuel vessels, and (5) new business opportunities.
In either scenario, we verified that the transition plan set forth in Environmental Vision 2.2 would
function as an appropriate mitigation measure and demonstrate sufficient resilience.
Vessels are inherently resistant to direct physical risks due to their ability to freely navigate the
seas, and the risks to be considered are mainly indirect risks, such as the impact of supply chain
disruptions on transportation demand. Since the degree of impact on our business in the event of
indirect risks varies greatly on the cargo to be transported and the risks that emerge, therefore,
we proceed with our analysis after identifying and organizing the major cargoes and risk events as
comprehensively as possible.
When an event such as a supply chain disruption occurs, it often affects many areas of the
shipping industry and has compounding consequences, which may not necessarily have a negative
impact on our business. Please refer to the relevant page on our website for detailed disclosure
regarding the examination of physical risks that take into consideration the characteristics of the
industry.
By classifying major risks related to our overall businesses and mapping these risks based on their
impact level and likelihood of occurrence, we are preparing to identify important issues. Identified
as a major risk through this process, climate change is being further classified and assessed by the
Environment & Sustainability Committee.
MOL conducts management based on a variety of indicators and targets. For example, we disclose
emissions intensity and Scope 1, 2, and 3 GHG emissions, and we have incorporated these indicators
into the medium- and long-term targets set out in MOL Group Environmental Vision 2.2. Also, we
set quantitative targets in management plans for investments in low-carbon and decarbonization
fields and conduct related performance management. Further, our decisions on investments reflect
carbon prices that are calculated by using internal carbon pricing.
Strategy (financial impact)
Strategies (example of response measures: basic concepts related to physical risks)
Risk Management
Indicators and Targets
Particularly Significant Risks and Opportunities Identified through Scenario Analysis
Change in marine cargo movements
Introduction of carbon tax
Change in fuel costs
-¥10.0 billion
-¥270.0 billion*
+¥40.0 billion
Introduction of clean
alternative fuels
Mitigation of the carbon tax
impact through emission
reductions
Expansion of low- and zero-
emission energy businesses
Offshore wind power generation-
related businesses and ammonia
and hydrogen transport, etc.
Reflection of higher
costs in freight rates
Introduction of energy-
saving technologies
Boosting of vessel
operating efficiency
+¥120.0 billion
+¥30.0 billion
+¥110.0 billion
+Further improvement
of profits
Projected effects on profit through 2050 under the 1.5°C scenario
Specific measures in the transition plan of MOL Group Environmental Vision 2.2 and
the effect on ordinary profit in 2050
Ensuring resilience to climate change-related risks by implementing
the mitigation measures set forth in MOL Group Environmental Vision 2.2
More detailed information on disclosures based on TCFD recommendations can be found on our website.
https://www.mol.co.jp/en/sustainability/environment/tcfd/
*Monetary impact if all vessels continued to use oil fuels until 2050
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Special Feature: MOL Group’s Offshore Wind Power Generation-Related Business
The offshore wind power generation-related business is an area with synergies with the Group’s existing businesses and has the potential for sustainable growth amid the rapid shift from fossil
fuels to renewable energy. For the Group, which is engaged in the shipping businesses, responding to climate change is an unavoidable and urgent issue. The Group will not only reduce its own GHG
emissions, but also contribute to reducing the emissions of society through the expansion of our low- and zero-emission energy businesses. This special feature highlights the competitive advantages
of the Group in the offshore wind power generation-related business, as well as the specific initiatives it has undertaken.
Offshore wind power generation is a wide-range industry, with much of its supply chain extending offshore. The MOL Group consists of a number of operating companies active in areas peripheral to
offshore wind power generation, including marine consulting, towing, coastal shipping, heavy goods transport, and logistics. We expect synergies with the knowledge and resources we have developed
as a group for the entire offshore wind power generation value chain. In addition, our worldwide network and good relationships with domestic and overseas partners in the marine transport business
will help us to enter not only the domestic market, which is expected to expand rapidly, but also the European market, which is leading in offshore wind power, and the emerging markets, which are
expected to develop in the future.
In order to anticipate the standards and needs of the offshore wind industry, we believe that our involvement in the power generation
business itself, which is the core of this industry, will enable us to enhance the sophistication and quality of our peripheral business services,
which is one of the strengths of our Group. By combining and packaging these peripheral businesses, we will provide comprehensive services
and one-stop services that can only be offered by our Group. For example, fixed-bottom offshore wind farms are currently the mainstream,
but floating offshore wind power* projects are highly promising. We are the only company in Asia with experience in owning and operating
FSRUs, and the floating offshore wind power business is an area where we can utilize our knowledge and expertise in offshore businesses
and offshore structure operation. As the floating offshore wind turbines are installed at a longer distance from the coast, their supply chains
are also expected to be longer and larger. We are positive that our strengths can be utilized throughout the entire process, including towing,
installation, mooring, maintenance, and operation of wind turbine components and foundations (floating structures).
Offshore wind farm
SOV transporting maintenance technicians to an offshore substation
Photo provided by Ørsted
Marine consulting
Heavy goods transport
Installation of power generation
equipment (SEP vessels)
Power cable laying vessel business
Provided by KDDI Cableships & Subsea Engineering Inc.
Maintenance (technician transport)
Competitive advantage in offshore wind power generation-related business
Affinity with the knowledge of the MOL Group, which has been working at sea for nearly 140 years
Enhancing the sophistication and quality of peripheral business services by participating in the power generation business
1
2
*It is said that the water depth at which fixed-bottom wind turbines can be installed is generally about 50 meters, so the available sea area is limited. Large-scale offshore wind farms can be developed by
utilizing floating wind turbines, which are not limited by water depth.
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Personnel development
and supply for wind power
maintenance
Asia’s first SOV business
Ownership, management,
and operation of CTV
Established a personnel consulting
company in cooperation with
Magsaysay Group (Philippines)
This business is involved in the
operation and maintenance support
work for an offshore wind farm in
Greater Changhua (Taiwan)
Involved in development to provide
engineer transportation services
adapted to sea and weather
conditions unique to Japan
The value chain for offshore wind power generation consists mainly of the development and operation of power generation projects, and the MOL Group provides a wide range of services in peripheral
business fields, from project startup to maintenance and operation. In the development stage, our marine consulting company conducts surveys and assists in selecting the potential project area.
In the transportation of wind power generation equipment, we provide integrated sea and land transportation services for heavy cargo such as wind turbines and foundation components, as well as
loading and unloading services in ports. In the construction and installation phases, we have accumulated knowledge through indirect ownership of shares in a company that owns and operates SEP
vessels. We are also considering the commercialization of power cable laying vessels based on our more than 50 years of experience in ship management and operation of telecommunication cable
laying vessels. At the maintenance and operation phase after the start of operation, we provide Service Operation Vessels (SOVs) and Crew Transfer Vessels (CTVs) as transportation for maintenance
technicians (see Pickup Column). For the development of offshore wind power maintenance personnel, we plan to construct a training facility dedicated to the operation and maintenance of offshore
wind power generation jointly with Hokutaku, a company specializing in maintenance for wind power generation facilities, and provide training that assumes the unique risks associated with offshore
wind power generation.
The Group is actively expanding its business beyond transportation and is the first in the Japanese shipping industry to participate in an offshore wind power generation business. It is also the
first company in Asia to own and operate a newly built SOV. While refining the advantages we have cultivated through our long history in the shipping industry, we will strive to be recognized as an
essential partner by the diverse players in this industry through our group-wide efforts in offshore wind power generation-related businesses.
Overview of the entire value chain of the offshore wind power generation business and the Group’s initiatives
The overall image of the entire value chain of the offshore wind power generation business and the Group’s initiatives
Sea area survey &
selection support
Investment in power
generation business
Power cable laying vessel
business
Integrated marine/
ground transportation of
wind power equipment
Support for selection of expected
business areas from the
standpoint of marine consulting
Develop a floating offshore wind power
project generating a total of 2GW
(Collaborate with Flotation Energy)
Acquisition of shares of the company
operating the Formosa 1 offshore wind farm
Made an investment related to the
Kitakyushu Hibikinada offshore wind farm
(Collaborate with Hokutaku)
Promote commercialization
in order to meet the growing
demand
Total support for ground/
marine/air transportation,
port cargo handling,
customs clearance,
installation, etc.
Entry into SOV and CTV businesses
TSS Pioneer, the first SOV in Asia owned and managed by a joint venture
established with a Taiwanese partner, is on a long-term charter to Ørsted, the
world’s largest offshore wind farm operator, and is engaged in maintenance
support for the largest offshore wind farm in Taiwan being developed by the
company.
In addition, several CTVs will be engaged in the construction of the Ishikari
Bay New Port Offshore Windfarm and the transportation of offshore wind
turbines and onshore workers. In addition, our CTV is the first coastal CTV
certified under the ISM Code, an international standard for the safe management
and operation of ships, and provides world-class safe operational quality.
SOV “TSS Pioneer”
CTV “KAZEHAYA”
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Regional Strategy
After careful review, we decided to adopt the ‘India Model’ globally from 2023. We expect to
see more initiatives led by each of the other regions: Asia-Oceania, Europe & Africa and North &
South America.
The essence of our Regional Strategy in BLUE ACTION 2035 is to enable growth in the future key economic regions of the world.
We do this by empowering our local offices, strengthening market focus, and ensuring speed and quality of decision-making. We
started this initiative in 2022, with India as a model case.
India is growing strongly and is expected to become the world’s third-largest economy this decade. Improved governance, a
dynamic business sector, widespread adoption of digital technologies, talented human resources and balanced foreign relations
make it an attractive destination for long-term investment.
We introduced a new organization structure in 2022, with an empowered regional team and a joint working arrangement
between region and head office.
Major achievements in FY2022 under our strategy for the business in India
Additional four vessels deployed through our Indian subsidiary, Sakura Energy Transport (total 9).
Entry into new segment, i.e. product tankers. Leveraging India’s unique position as a major petroleum refiner
and exporter of products to the Middle East, Europe and elsewhere.
Substantial increase in volume of pure car carrier (PCC) business with auto-makers in India, for export of their
vehicles to the Middle East and elsewhere.
Over 15% growth in the logistics forwarding business, with 2 new offices opened and a substantial increase in
staff.
Transfer of LPG vessels to our Mumbai-based ship management team, utilizing our Indian maritime human
resource pool, potentially opening up new avenues for our global fleet management
The India Model
Executive Committee and Board
Executive Officer
(Region)
Executive Officer
(Business HQ)
Region and Business Headquarters both empowered
to take decisions
Collaboration and Decision Making
Sakura Energy’s first ship, the VLGC Hisui CEO Hashimoto inaugurates new Mumbai office extension
Learning from the experience in India
Merging multiple local subsidiaries to break down silos and leverage the MOL brand
Nurturing talent, developing skills, rewarding performance and improving management practices
Implementing a ‘One MOL’ HR system across businesses to develop a customer-focused workforce
Our objective is to enhance our competitiveness as a modern organization delivering excellent service to
customers. Our India experience has helped us identify many opportunities to improve our global work
practices.
Ajay Singh, Managing Executive Officer (South Asia – Middle East Region)
“Retaining the trust and affection of customers through service that efficiently meets
their needs is fundamental to success in any business.
MOL’s regional strategy places the customer at the center of everything we do. It aims
to accurately identify customer needs, correctly judge the business environment,
swiftly develop opportunities and deliver high-value service. All else – including our
internal arrangements – is to be organized to achieve this goal. We grow by facing
and solving problems, reviewing work practices, trying new ways and learning from
setbacks. This is the spirit of MOL’s team.”
Wataru Funabiki (right), leader of Indian Ocean Rim Strategy of Car Carrier Business in FY2022
“After working in India for 4.5 years, I‘ve come to appreciate the significant potential of
the Indian market. I’ve gained insights into the competitive landscape, unique customer
preferences, and local business practices. More importantly, as an expat, I‘ve been able
to effectively relay these insights to our head office, contributing to the development of
our regional strategy. This strategy now serves as our roadmap for resource allocation
and sales & operations planning. In line with this strategy, we’ve been able to expand our
service network in the region, more than tripling its size* in the past 3 years"
MOL organization in the Regions and Headquarters
(Joint Project Teams)
*Number of voyages
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Sustainability Issues (Materiality)
We have identified five “Sustainability Issues” (materiality), which are social issues that should be prioritized throughout our business. This was identified with an awareness of two aspects (double
materiality): not only the impact that the environment and society have on the Group, but also the impact that the Group has on the environment and society.
In BLUE ACTION 2035, we have positioned “Safety,” “Environment,” “Human Capital,” “DX,” and “Governance” as the five most important sustainability issues to further promote our efforts to address
sustainability issues and have formulated a vision that defines our basic approach and the desired image. By integrally promoting management plans and addressing issues, we will strive to improve the
corporate value of the Group through the realization of the Group vision and contribute to the realization of a sustainable society.
Sustainability Issues
Safety & Value
Provide added value through
safe transportation and our social
infrastructure business
Safety vision
(under development)
MOL Group
Environmental Vision 2.2
MOL Group
Human Capital Vision
MOL Group DX Vision
MOL Group Corporate
Governance Policy
Initiative themes
Value through our core
business
Safety levels
Creation of new added
value
Environment
Conservation for marine and
global environment
Initiative themes
Climate change
countermeasures
Preservation of marine
environment
Protection of biodiversity
Prevention of air pollution
Human & Community
Contributing to the growth and
development of people and
communities
Initiative themes
Diversity, Equity &
Inclusion
Mutually empowered
Highly engaged
Growing together with
local communities
Innovation
Innovation for development
in marine technology
Initiative themes
Groupwide adoption of
clean energy
Increasing the energy
efficiency of vessels
ICT utilization for safe,
efficient operation
Digital transformation (DX)
Governance
Governance and compliance to
support businesses
Initiative themes
Management transparency
Information security
Responsible procurement
Respect for human rights
Fair trade
Bribery prevention
Sustainability Plan
We have developed a sustainability
plan, “MOL Sustainability Plan,”
which sets targets, KPIs, and
action plans for each sustainability
challenge. By addressing
sustainability issues and
incorporating specific action plans
as part of the management plan,
we are working to further integrate
our sustainability initiatives into
management. By steadily
implementing the “MOL
Sustainability Plan,” we will
strengthen our efforts to resolve
sustainability issues, appropriately
measure the effectiveness of our
efforts, and implement appropriate
improvement activities.
P31
P29
P33
P35
P43
For details, please refer to our sustainability website.
https://www.mol.co.jp/en/sustainability/management/issues/
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Initiatives for Sustainability Issues (Safety)
The Group has leveraged the knowledge and networks it has cultivated in the shipping business to
develop various social infrastructure businesses that go beyond marine transportation, such as offshore
businesses. These new businesses must also be based on “safety,” the most important foundation of
our value creation. For this reason, we will expand the scope of our safety efforts and formulate a new
safety guideline “Safety Vision” that encompasses not only shipping but also non-shipping businesses,
as well as a concrete action plan for this new safety guideline by the end of this fiscal year.
One of the pillars of this plan is the advancement of safety levels through technological innovation.
By proactively adopting new technologies and utilizing digital technology, we will reduce the burden on
various sites, including onboard vessels, and create an environment that enables us to focus on safe
navigation and operations. In new business areas, human resources with know-how and a high level
of expertise cultivated in the field are indispensable. In marine transport, there is an ever-expanding
field that requires expertise learned on the ground, such as the introduction of new fuels to achieve net
zero emissions, not to mention the conventional management of vessels. As we transform our business
portfolio, we will work to further improve safety levels in conjunction with human capital and DX
initiatives.
To quantitatively evaluate safety levels and visualize the process of achieving it, we use the
“4 ZEROES” ((1) Zero serious marine incidents, (2) Zero oil pollution, (3) Zero fatal accidents, and
(4) Zero serious cargo damage), LTIF (lost time injury frequency),*1 average downtime,*2 and
downtime frequency rate*3 as ongoing targets and indicators.
From fiscal 2021, the scope of the data has been expanded to include all vessels operated
by the MOL Group (approximately 800 vessels), including vessels owned and managed by MOL
and chartered vessels. Given the magnitude of the impact caused on the environment and local
communities due to accidents, and the need to pursue high-quality transportation services regardless
of the type of vessel ownership, we should be proactively involved in the safety management of
chartered vessels, and we will ensure the safety levels of all vessels in operation by using the same
indicators to measure both owned and chartered vessels. In addition, we will place importance on
the safety of “PEAR” (People, Environment, Asset, and Reputation) with respect to a wider range of
safety issues, including non-shipping operations, in light of future business development.
Expanding the Scope of Safety Initiatives “Safety Vision”
Safety Levels Improvement Initiatives (1) (Quantitative Evaluation of Safety Levels)
4 ZEROES
Average Downtime/
Downtime Frequency Rate
Lost Time Injury Frequency
Note: All items that apply to
a single accident are counted,
including chartered vessels
Serious marine incidents
Oil pollution
Fatal accidents
Serious cargo damage
(Number of accidents)
(FY)
Average downtime (hours per ship per year)
Downtime Frequency rate
(Number of incidents per ship per year)
MOL’s target for average downtime per ship (<24 hours)
MOL’s target for downtime Frequency rate(<1.00)
(Number of incidents per ship per year)
(Hours per ship per year)
(FY)
Source of reference values:
Overview of Results of the 2022 Survey on
Industrial Accidents, Ministry of Health,
Labour and Welfare
Average among all industries in 2022 (2.06)
MOL’ s LTIF track record
MOL’s target since fiscal 2020 (<0.50)
(FY)
Establish a culture of safety across regions and business units
Direction of MOL Group Safety Vision
Training and recruitment
of seamen, and appropriate
allocation
Evolution and innovation of safety
quality by “technology innovation”
Outstanding capability in
risk and crisis management
Changes in the internal environment
“S” in MOL CHARTS = Safety
Pursue the world’s highest level of safety culture
ZERO TOLERANCE FOR FATAL ACCIDENTS
AND SERIOUS MARINE ACCIDENTS
Changes in the external environment
2
3
1
Expansion of business areas in both shipping and non-
shipping
Expansion of the fields where seamen are expected to be
involved
Maintain a safety first attitude and strive to reinforce
safety awareness
Return to basics by comprehending workplace safety
Eradication of fatal accidents and serious marine accidents
Stakeholder requirements for safety and security
Increased risks in terms of geopolitics, natural disasters
and security (including cyber risks ), etc.
Evolution of Technology
*1 The number of work-related accidents per one million hours worked.
*2 The amount of downtime due to mechanical malfunctions or incidents per ship per year.
*3 The number of mechanical malfunctions or incidents that result in downtime per ship per year.
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Since its establishment in 2007, the Safety Operation Supporting Center (“SOSC”) has provided
operational support for all MOL-affiliated vessels on a 24/7 basis by on-duty personnel including
experienced captains. In March 2023, the facility was renovated with the installation of a large video
wall system and is now operating as the center of safety operations and crisis management for our
fleet.
The SOSC is capable of simultaneously displaying on a large screen a large number of
information necessary to support the safe operation of the approximately 800 vessels operated
by MOL, including chartered vessels. The information monitored by the SOSC is not limited to
vessel location information, but also includes weather and sea conditions, information on piracy
damage, military exercises, etc., navigation plans for MOL-operated vessels, and advance detection
of intrusion into waters with high stranding risk. Based on this composite information, we monitor
the movements of our vessels while assessing risks, and contribute to safe operations by providing
necessary information to the vessels and other related parties in a timely manner. On the same
floor is the Crisis Response Room, which is used for serious maritime accidents and other similar
incidences, and it works as a system that enables seamless sharing of information on the situation
at the site monitored by the SOSC.
We employ a wide range of crew members from
various nationalities in Asia, mainly from the
Philippines and India, as well as Europe, so that
we can flexibly respond to the assignment of
high value-added vessels such as LNG carriers
and to changes in the business environment.
As for seafarer education, we are implementing
a comprehensive seafarer education and
training program for new seafarers to captains
and chief engineers, utilizing resources such
as training facilities located at six sites across
the world, with the aim of developing seafarers who can achieve the world’s highest standards of safe
ship operation. The effectiveness of this program has been recognized and certified by the Norwegian
classification society Det Norsk Veritas AS (DNV).
The MOL Magsaysay Maritime Academy (MMMA), a self-operated merchant marine academy opened
in the Philippines, is further promoting the education of new Filipino staff who will play a part as a
source of seafarers for our fleet. MMMA trains not only
seafarers who can be immediately effective on board, but
also trains those who can utilize the know-how cultivated in
the field to play an active role in a wide range of business
fields in the future. Specifically, we employ a coaching style
of education that encourages students to think, understand,
and act proactively, and we focus on education that fosters
leadership and a sense of contribution through proactive
participation in community contribution activities by the
students themselves. Approximately 200 of the 1st and 2nd
batch of students who enrolled at the time of the school’s
opening are currently undergoing practical training on
vessels owned by MOL (as of June 2023). The first group of
students will be onboard in early 2024 as third officers and
third engineers with immediate effect.
Safety Levels Improvement Initiatives (2) (Operational Support from Land)
Recruiting and training seafarers from different nationalities
SOSC
Crisis Response Room
Education at MMMA
Philippines
Other
%
%
India
%
%
%
%
Europe
Russia
Indonesia
Japan %
Ratio of
crew members by
nationality on
MOL-Owned/
Managed Vessels
(As of the end of March 2023)
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MOL REPORT 2023
Initiatives for Sustainability Issues (Environment)
In our Environmental Vision, we have set five actions to achieve our mid- to long-term targets
and are steadily reducing GHG emissions and emissions intensity. In April 2023, the MOL Group
Environmental Vision 2.2 was updated to include the development of interim milestones and
specific emission reduction pathways, and the progress of each action is quantified and visualized to
enhance the effectiveness of our efforts.
Overview of Environmental Vision 2.2
In the 2020s
By 2035
By 2050
Deploy net zero emissions
ocean-going vessels
Reduce GHG emissions
intensity by 45%
With the concerted effort throughout the Group,
achieve net zero GHG emissions
Environmental Vision 2.2 Overall
Adopt clean energy
01
ACTION
Further adopt energy-saving
technologies
02
ACTION
Efficient operations
03
ACTION
Build business models that
enable net zero emissions
04
ACTION
Expand low-carbon /decarbonized
business by leveraging the Group’s
collective strengths
05
ACTION
Amount of environmental investment:
¥650.0 billion
(Cumulative from FY2023) [2025]
Total amount of GHG emissions: 23%
reduction (compared to 2019) [2030]
No. of LNG/methanol-fueled ocean-going vessels: 90
Ratio of zero-emission fuel used: 5%
Ratio of power from renewable energy for Scope 2: 100%
[2030 for the above]
No. of net zero emissions ocean-going vessels: 130
[2035]
No. of vessels equipped
with Wind Challenger: 25
[2030]
No. of vessels equipped
with Wind Challenger: 80
[2035]
SCOPE 3-Cat.3
Emissions from the production of fuel consumed
SCOPE 3-Cat.11
Emissions from fuel sold by the Group
SCOPE 3-Cat.2
Emissions from the building of MOL’s owned vessels
Scope 3 Others
Total of Cat.1, 5, 6, and 7
Improve fuel efficiency by 5%
(compared to 2019) [2025]
Amount removal type carbon
credits used: 2.20 million t-CO2e
(cumulative) [2030]
Climate change and other environmental issues are our top priorities in order to enhance our corporate value and realize our group vision. MOL has formulated the MOL Group Environmental Vision, a
comprehensive policy for addressing environmental issues, and has become the first in the shipping industry to set a goal of net zero emissions by 2050 and disclose a specific roadmap in line with the Paris
Agreement’s 1.5-degree target. As one of the first movers in marine transportation, which is indispensable to the global economy, we will contribute to the sustainable development of society and establish a
competitive advantage in a low-carbon and decarbonized society by being among the first to provide transportation services with reduced GHG emissions.
For more information on MOL Group Environmental Vision 2.2, please visit our website.
https://www.mol.co.jp/en/sustainability/environment/vision/
Medium- to long-term targets
Five actions to achieve medium- to long-term targets
KPI and milestones to measure progress of actions
Total GHG emissions
SCOPE 1–Vessel
SCOPE 3–
Cat.3
SCOPE 1–
Others
FY2022
MOL group
GHG Emissions
(Unit: thousand tons)
SCOPE2
SCOPE 3–
Cat.2
SCOPE 3
Others
SCOPE 3–
Cat.11
S
C
O
P
E
1
S
C
O
P
E
3
FY2019 (base year)
14.3 million tons
13.3 million tons
FY2022
Down 7%
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The Environmental Vision 2.2 has the resolution of the GHG emissions reduction pathway toward 2050 Net Zero improved from the previous version, and the contribution of each action is quantified.
Clarifying the “Pathway to Net Zero Emissions”
Wind, a clean and inexhaustible energy source, is used as the driving force. The Wind Challenger,
a wind-powered propulsion auxiliary device developed by MOL, is expected to reduce emissions by
approximately 5% to 8% on the first 100,000-ton bulk carrier, although the effect will vary depending
on the size of the ship. It does not interfere with the mainstream underwater energy-saving devices
that have been used in the past, and its effects can be maximized for GHG reduction by utilizing it
in conjunction with measures to improve operational efficiency and fuel conversion. The first vessel
has been operational since the fall of 2022, and we aim to equip a total of 80 vessels by 2035.
We aim to contribute to the removal of a cumulative 2.2 million tons of CO2 from the atmosphere by
2030 by promoting negative emissions initiatives that remove and store CO2 from the atmosphere
through both nature-based approaches that increase CO2 absorption by the nature, such as
mangrove regeneration and conservation, and technology-based approaches that use chemical
engineering techniques to remove CO2 from the atmosphere. Furthermore, in accordance with the
framework presented in the SBTi Corporate Net-Zero Standard, the Group will not offset emissions
with carbon dioxide removal when calculating emissions in the years leading up to the net-zero
target year (2050), but we will give priority to reducing our own emissions.
The adoption of clean alternative ship fuels plays the most significant role in reducing GHG
emissions. There is an upper limit to the amount of GHG emissions that can be emitted globally
to limit temperature rise to a certain level, and there is not much carbon budget left to achieve
1.5 degrees. On the other hand, a stable global supply system for future zero-emission fuels
such as ammonia and hydrogen has not yet been established to meet the demand in oceangoing
shipping, which requires a large amount of fuel. In order to be carbon budget conscious and reduce
cumulative GHG emissions by 2050, we will not postpone measures, but will aggressively shift to
LNG and methanol fuels, which are low-emission marine fuels that can be utilized immediately, from
the ground up to ensure emissions reductions until zero-emission fuels become widely available.
(See previous page for clean energy deployment milestones.) In addition, we expect that promoting
a quick transition to low-emission fuels will reduce the financial impact of carbon pricing, which is
anticipated to spread further in the future.
1 Efficiency improvements mainly focused on wind propulsion:
3 Neutralization through carbon dioxide removal
2 Adoption of clean energy
Watch the completion of the first ship with Wind Challenger.
https://youtu.be/3gILS7NmGZs
Reduction through operation efficiency
and introduction of energy saving equipment
Efficiency
improvements
mainly focused
on wind
propulsion:
Approx. 20%
Neutralization
through carbon
dioxide removal
Adoption of
clean energy:
Approx. 70%
Less than
10% residual
Reduction through
ammonia and hydrogen
Net emissions*2
Scope1/2 Emissions*1
Reduction through biofuels
Reduction through LNG and methanol
→ e/Bio-methane/methanol
Vertical axis: GHG emissions
Carbon dioxide removal
*1 Scope: MOL and all consolidated subsidiaries. Scope 3 emissions are also included in the 2050 net zero target.
*2 For the calculation of emissions for years prior to the target year of 2050, emissions will not be offset with carbon dioxide removal.
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Initiatives for Sustainability Issues (Human Resources)
In line with our BLUE ACTION 2035 corporate management plan, we have formulated our basic
approach to the Group’s human resources policies under the theme of “All on Board, Success
through Growth,” which we have then announced as the MOL Group Human Capital (HC) Vision.
BLUE ACTION 2035 depicts the Group’s efforts to achieve new growth through the expansion of the
fields in which it operates as a sea-based social infrastructure business. We recognize that to this
end, it is essential that we transform our Human Resources system, which is focused on generalists
hired by the Group headquarters, overcome barriers, including the traditional organization and
region, and that we build an environment in which diverse human resources can play an active role
throughout the Group. In HC Vision, we set out the three basic principles of our human resources
policies: Diversity, Equity & Inclusion, Mutually Empowered, and Highly Engaged, which are in line
with the BLUE ACTION 2035. After having a better understanding of the gap between the current
reality and what we aspire to be, we will set our targets and then monitor and disclose externally
the progress of our initiatives toward achieving the targets.
Basic Approach to Human Resources Strategy
Looking ahead to FY2035, the target year of BLUE ACTION 2035, HC Action 1.0, which is the action plan of HC Vision,
consolidates the priority human resources measures and their targets for the years FY2023 through FY2025. Specifically,
we are aiming to develop and strengthen our basic systems relating to human resources, including establishing a skill
matrix, which is a Group-wide set of criteria for measuring the capabilities of human resources, establishing and building
a database of evaluation methods, setting definitions of job positions and implementing uniform appointments, and
strengthening the capabilities of divisions managing human capital in line with the three basic principles of HC Vision.
At the same time, we are also aiming to offer up new role models. We have already incorporated elements of an open-
type system for making submissions into our corporate venturing program for suggesting new business ideas. Added to
this, we intend to introduce a full-fledged open job application system for positions within the Group. In June of this year,
we conducted a trial of the open job application system in three departments at the Group headquarters. Measures based
on HC Action 1.0 are initiatives that aim to transform the Group into a corporate group that appeals to a wide range of
human resources as a place in which they can play an active role. The Group regularly reviews the effectiveness of these
measures via the results of engagement surveys and updates the details of the measures, as necessary.
Phase 1 (FY2023 to FY2025) Targets
Current Situation
Headquarters play
a central role and lead
the entire group
Company-led human
resource allocations
Model focused on
cultivating generalists
Study and monitor the
corporate culture
MOL Group HC Action 1.0
(1) Implementation of human capital
acquisition and allocation
(2) Achieving the right people in the
right place
(3) Implementing talent management
with the use of technology
(4) Supporting autonomous career
development
(5) Improvement of employees’
engagement
(6) Strengthening the capabilities of
divisions managing human capital
(7) Enhancement of attractiveness for
Seafarers
Targets to achieve by the end of FY2025
Requirements to Achieve the Corporate Management Plan
Diversity,
Equity & Inclusion
The success of diverse
human capital
Mutually Empowered
Create and run
the future together
Highly Engaged
Improve engagement
Enable a diverse range of human
capital to flourish, regardless of
nationality, gender or age
Support various types of employment
Ensure the right people are placed in
the right positions Groupwide
Composition of people filling MGKP
(1)Percentage who are women:············································· 8%
(2) Percentage who are not from headquarters:···· 30%
(3) Percentage who are in their 40s or younger:···· 15%
(Non-consolidated) Office workers: Percentage of
managerial positions filled by women:························· 15%
Communication implementation rate aimed at
achieving and practicing the Group Corporate Mission,
Vision, Values····················································································· 100%
Number of transfers due to the open recruitment of
positions Groupwide
(cumulative figure over three years)································50 cases
Engagement Survey (ES) response rate
(all Group companies)······································································· 90%
Percentage of organizations where the KPI score
for “Engagement” improved in the ES
(all Group companies)······································································· 70%
Work to enhance Groupwide
engagement based on a more open
culture and flatter organization
Engage in dialogue to instill management
strategies
Develop environments and systems for
each individual to autonomously enhance
their expertise and improve their skills
Keep accurate track of information on
talent, giving consideration that respects
the will of each individual
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In HC Action 1.0, we have set out “Implementation of human capital acquisition and allocation” and
“achieving the right people in the right place” as priority measures. Thus far, headquarters have led
the entire Group. However, as we move toward a transition in our business portfolio in accordance
with BLUE ACTION 2035, it will be important from here on out that we identify the necessary
positions and the duties of such positions for the entire Group and realize the placement of the right
people in the right places.
To this end, we will establish a skill matrix as a Group-wide set of criteria for measuring the
capabilities of human resources. The skill matrix will set out the skills required of employees to
work in the Group, and it will comprise the following three elements required for the respective
position types: specialization, management skills, and mindset. We believe that this is a necessary
measure if we are to promote integration on the human resources front through M&A-driven
business expansion, which we expect to achieve moving forward. On the basis of this skill matrix,
we will clarify definitions for job requirements for major MOL Group Key Positions (MGKP) that drive
business execution across the Group, and evaluate the skills of candidate human resources, aiming
to promote human resources regardless of the number of years of service or the departments to
which they belong.
Furthermore, we intend to introduce a talent management system with a human resources
database in this fiscal year that will enable us to better visualize the skills and experience of our
employees. With this, we aim to identify and pool MGKP candidates as well as formulate training
plans, including skills development and selection of junior employees bound for management
positions at an early stage, while also enabling us to be more flexible in how we respond to human
resource issues as we move to transform our portfolio. With regards to post-recruitment handling
of employees, we will make revisions to the relevant systems, starting with those at the Group
headquarters, as we seek to improve the appeal of the Group.
“Implementation of human capital acquisition and allocation”
and “achieving the right people in the right place”
Demand for the human capital needed to achieve
the Corporate Management Plan
Allocation and active participation in
priority areas
Strengthening of hiring functions for specialist
human capital in a diverse range of fields
Developing foundations as a company
that is chosen by prospective talent
Sustainability Issues
Regional Strategy
Portfolio Strategy
Achieving theme-specific visions (Safety, Environment, Human
Capital, Digital Transformation)
Global human capital with
roots in local communities
that drive business
Human capital responsible
for strengthening gover-
nance
Human capital leading the
launch of new businesses
Group human capital to drive
non-shipping business (real
property, cruises, logistics
business, etc.)
Human capital with expertise
in M&A and IFRS adoption
Business growth &
investment in human capital
Acquire and allocate human capital
Reference Visualization of Skill Management System
Human Capital Database
MOL Group Key Positions (MGKP)
Information of human
capital is collected from
Group companies globally
and centrally managed
Candidates for Group
managers are selected and
systematically cultivated at
an early stage
Skill and position
information is defined
Important positions across the Group are designated as MGKP.
The job descriptions and requirements for human capital are clarified.
Optimum
Groupwide
allocation of
human resources
is achieved
Headquarters
General Managers
Group companies in
Japan
President and some high-
level officers
Major posts outside
Japan
Head of Corporate Functions
& Head of Marketing in each
region, Presidents
New posts associated with
business expansion
Senior
Executives
MGKP
(General Manager in Head Office/
Group Officers)
Human resource allocation is determined by
headquarters from the viewpoint of the overall
management of the Group
Note: We are aiming to increase the percentage of MGKP employees who
are not from headquarters to 30% by the end of fiscal year 2025.
This layer represents the employees responsible for the
management of their respective Group companies. Each company
takes initiatives pertaining to selection, cultivation, and skills
development. In addition, support for these initiatives is provided
by the Company from the viewpoint of overall management of the
Group with a view toward future candidate MGKP employees.
Basic initiatives toward employee cultivation and
skills development at the respective companies
(the Company provides support as necessary)
Candidate MGKP
Managers
General
Group Companies
General
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Initiatives for Sustainability Issues (DX)
The business environment of today is changing rapidly, with it now being necessary for companies
to optimize their business processes and business models and increase their efficiency and
competitiveness through digital transformation (DX). The Group has been engaged in efforts to
resolve sustainability issues through digital means, including issues pertaining to safety and the
environment, as well as efforts to strengthen our competitiveness in the global market and to create
new business models. For example, we have worked to optimize operations and fuel efficiency using
ship operating data and AI.
In order to realize BLUE ACTION 2035, the Group is proactively engaged in digital transformation
activities. In March 2023, we formulated the MOL Group DX Vision as an expression of the Group’s
ambitions and the MOL Group DX ACTION 1.0 action plan. With DX ACTION 1.0, we are driving
change in both business and culture, making efforts toward the realization of the various strategies
set out in BLUE ACTION 2035, and contributing to the successful implementation of efforts geared
toward resolving sustainability issues.
In DX Vision, we have formulated three core concepts with regard to DX promotion by the Group.
(1) Shift from routine work to value creation and safety work
(2) Further use of integrated data infrastructure
(3) Provide training programs to all employees to nurture Change Leaders* for the future
business transformation
We are aiming to have gone fully digital and to have optimized our business operations and
organization by the end of 2025 and to have become a leading company with regard to helping
resolve social issues relating to shipping and beyond through the use of digital technologies by 2035.
We believe that efforts to shift to the value creation of human resources as well as safety and
environment-related initiatives, which are the mission of our marine transport business, are key.
Therefore, we have set conversion rates in the form of Core KPIs for these business operations as
targets for promoting DX in the Group.
Positioning within BLUE ACTION 2035
Ambitions
MOL Group Corporate Mission / Vision / Value
Management Plan
Representation of the company’s future
ideal state achieved with
digital technology
General title for action plans under the
MOL Group DX Vision
Roadmap of the company's
digital transformation
Three-year action plan based on
the road map
DX Vision
DX Action 1.0
DX Road Map
Three-year Action Plan
Digitization
initiatives up
until now
Digitalization and
industry-leading
operational
excellence
Transformation
to a leading company
using digital power to
address social
issues
DX Action 1.0
~2025
Digitized / Digitalized
Promote digitalization and
optimize business processes
2026~
Transformed
Transform corporate value and
social significance of the company
Target
Phase 1
FY2025
Phase 2
FY2030
Phase 3
FY2035
DX
Conversion rate to value creation
and safety work (cumulative)
10%
20%
30%
*A person promoting changes in business models, business processes, corporate culture, etc.
A person who understands business and process issues, is able to envision the ideal state and lead the change.
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Introduction to Initiatives
Under DX Action 1.0, we have co-created a total of eight items relating to sustainability issues in the two areas of Business Transformation and Culture Transformation and initiatives for addressing each of
these, which are driving changes.
Business Transformation with Digital
Change business, safety, and service
(1) Data
Integrate data to let stakeholders discuss effectively based
on the same data set.
(2) Business Process
Create time for new opportunities and value creation
through standardization, optimization and automatization
of business processes.
(3) Business Management
Assure quick decision making by using daily updated
information.
(4) Onboard Routine Tasks
Digitize manual routine tasks onboard and create time for
safe operation.
(5) Shore – Vessel
Communication
Speed up sea-shore communications and use video,
MR(mixed reality) technology to improve operation and
safety level.
Culture Transformation with Digital
Change people, organization, and culture
(6) Global Human Capital
Management
Integrate corporate skills/talent information to start
effectively managing the global human capital.
(7) Crews’ QOL
Speed up offshore communications and provide a living
environment that allows instant connection with the shore to
increase seafarers’ engagement level.
(8) Nurturing New Value in
Employees
Provide training programs to share the skills and
knowledge that lead to value creation and nurture
Change-Leaders.
Introduction to Results of Initiatives
Construction of vessel owner information dashboard supporting chartering
chain management
As part of our efforts toward sustainable business activities, the Group is engaged in
chartering chain management activities to ensure appropriate governance in chartered vessel
procurement, to improve safety levels and sustainability, and to pursue overall optimization
of the Group’s chartered vessels. To support the efforts, we built a vessel owner information
dashboard in June of this year that comprehensively integrates both in-house and external
information and collates indices for use as reference.
Traditional vessel owner evaluations were based on information obtained through Group
owned and managed vessels, and had the issue in which the records of all vessels owned by
shipowners were difficult to access. By incorporating global shipping data, accident information,
and port state control (PSC)* information that are provided by external organizations, it has
become possible to comprehensively check information that conforms to a certain standard;
from basic information such as the Group’s share and positioning from the perspective of the
various vessel owners and the ages of Group-owned vessels to the relative positioning of each
vessel owners appointed by the Group based on the accident and PSC history of Group-owned
vessels. Furthermore, by putting in place a mechanism for storing the primary data sources that
the Group uses in MOL PEARL—the Group’s integrated platform—we have been able to automate
updates and make it possible to view the latest information at all times.
In the future, our goal is to use this dashboard to quantitively evaluate the safety levels
adhered to by vessel owners, including confirming whether the safety levels of vessels, vessel
owners, and vessel management companies meet the standards demanded by the Group during
charters and evaluating their performance after the charter. Those vessel owners who maintain
a high quality of service based on the said evaluations are positioned by the Group as strategic
partners with whom, based on the spirit of long-term partnership, we will work together to
ensure world-leading safety levels.
*On-board inspections of foreign vessels that dock at ports. An inspector from the port country boards the foreign vessel to
check whether the standards stipulated in the relevant treaty are being met; if the standards are not met, the inspector orders
repairs or corrective actions.
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Special Feature: Governance Meeting Dialogue Between Outside Directors and Shareholders
Outside Directors
Shareholders
In fiscal 2022, MOL held its Governance Meeting for the first time,
providing an opportunity for the outside directors and the chairman of the Board to have a face-to-face dialogue and exchange views with major shareholders.
Three outside directors and MOL’s chairman of the Board, Junichiro Ikeda, responded to forthright questions from five institutional investors,
about topics such as the development and supervision of management strategies, remuneration and nomination, risk management, and the next management plan.
To realize the sustainable enhancement of corporate value,
Mitsui O.S.K. Lines, Ltd. has an effective Board of Directors
that guarantees appropriate decision-making.
This special feature presents a dialogue in which MOL’s outside directors
discuss their thoughts on a broad range of topics,
with a focus on the Company’s governance.
Junichiro Ikeda
Chairman of the
Board
Yuuichi Tezuka
Sumitomo Mitsui
Trust Asset
Management
Yasushi
Arakawa
Asset Management
One
Yasushi Kondo
Resona Asset
Management
Masamichi
Fujisawa
BlackRock Japan
Nariaki Hirano
Nomura Asset
Management
Masaru Onishi
Outside Director
[Independent Officer]
Etsuko Katsu
Outside Director
[Independent Officer]
Hideto Fujii
Outside Director
[Independent Officer]
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As an outside director of Mitsui O.S.K. Lines, what do you pay particular attention
to and emphasize on a daily basis?
Q1
Fujii: As MOL’s outside director, there are two
points that are particularly important.
One is the fact that MOL operates a
social infrastructure business that plays a
role in economic security. It is necessary to
comprehensively consider not only business
profitability but also its social significance, as
well as how the Company responds in the event
of unforeseen circumstances. Unfortunately,
although not fully acknowledged, there is a
stronger need than ever for awareness of
marine transport’s position as part of economic
security, not only by the government but also
by society at large.
In the past, MOL was exposed to too much
risk compared with its capital, and the focus
was on how to confine those risks to within a
controllable range. However, with the recent
favorable financial performance, the positions
of capital and risk quantity have been reversed.
How to make effective use of the earned capital
will be focused in the upcoming management
plan.
My other emphasis is on accountability.
I see this as the responsibility to make efforts
to provide information in a format that is easily
comprehensible for all stakeholders, not in
a self-centered way. From that perspective
as well, I hope that the institutional investors
here today will give their frank opinions about
information they have a strong interest in, and
about the best ways of communicating it.
Katsu: What I constantly keep in my mind as an
outside director is to supervise management
from an independent position representing
the shareholders and investors. From that
perspective, when I look back on my years as
an outside director since 2016, my impression
is that the MOL Board of Directors has made
great strides in its effectiveness year after
year. I have also seen a major increase in
opportunities and time for discussions beyond
the Board of Directors, such as the Nomination
Advisory Committee and the Remuneration
Advisory Committee, and the Corporate
Governance Council. At the same time, the
agenda setting of the various meetings has also
become more effective, and I truly feel that the
role of the Board of Directors is clearly shifting
toward a greater focus on the examination
and determination of strategies and on its
supervisory role.
Another point that I personally emphasize
is the upgrading of ESG to realize the medium-
to long-term expansion of corporate value. MOL
has set innovative net zero targets for reducing
GHG emissions in the marine transport area,
and in addition to environmental issues, MOL
is closely watching social issues, such as the
working conditions of seafarers.
In addition, in terms of risk management,
I believe that it has become even more
important to prepare for unpredictable
risks that cannot be sufficiently assessed by
conventional quantitative methods.
Onishi: I see my roles as an outside director
as fulfilling our commitments to our various
stakeholders in open and honest ways and
providing full accountability in the event of
unfavorable outcomes. Also, as someone who
used to work for an airline, even with the
differences between marine transport and
air transport, from the outset, I have been
vocal about safety culture and environmental
measures. I am pleased to say that my
opinions have been met with extremely positive
responses, and most of my recommendations
have been fulfilled. It was a different culture
for me coming from outside the Company,
so to speak, but people in MOL always show
a willingness to listen. I sense that MOL
has a free and open corporate culture that
encourages active exchanges of opinion,
generosity toward different cultures, and a
visionary ethos.
Onishi: In fiscal 2020, the director remuneration
plan was revised for the first time in twenty
years. Because MOL’s market-oriented business
has held a particularly high weight in its business
portfolio until now, meaning that its performance
is impacted by the circumstances at any given
time, the prevailing view was that an evaluation
method based on single fiscal year performance
is not suitable for the business characteristics
For this reason, in the recent revisions,
variable remuneration, which accounts for
40% of the whole, was divided equally between
remuneration based on single fiscal year
performance and remuneration commensurate
with contribution to long-term targets. In
addition, the latter is paid in the form of stock
grants instead of monetary remuneration. As a
result, it became possible that current efforts
towards long-term goals were reflected in
Could you tell us about the reforms of the remuneration plan implemented in fiscal
2020? Also, do you think that climate change responses should be added to the
evaluation criteria for directors’ remuneration?
Q2
Hideto Fujii, Outside Director
Yuuichi Tezuka, Sumitomo Mitsui Trust Asset Management
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Katsu: Because the evaluation criteria
for directors related to single fiscal year
performance-based remuneration are quantitative
indicators, evaluation can proceed whether
the person being evaluated is present or not.
I assume that your question refers to whether
or not the president himself should be present
during deliberations regarding the “targets for
individual directors” portion of remuneration
based on contribution to long-term targets,
which requires qualitative judgments. Currently,
the president conducts evaluations of individual
directors and submits them as proposals to
the Remuneration Advisory Committee. For
the president’s evaluation alone, the chairman
confirms the contents before submission.
There is currently no arrangement for
the president to leave the room while his
remuneration is being deliberated, but an
awareness of this as an issue has emerged
internally, so we ameliorate this issue from fiscal
2023 onward.
Fujii: I agree with your suggestion considering
what form would better satisfy our stakeholders.
On the other hand, as you may have sensed from
the discussions so far, we outside directors do
not shrink from expressing severe opinions in
Board of Directors meetings. We would certainly
not hold back in our comments, just because the
president being evaluated is present.
evaluations, and I feel that it has come closer to
the perspective of shareholders. We have also
been able to further strengthen awareness of
safety by incorporating safety-related results in
all directors’ evaluations.
Katsu: I also believe that it is crucial to
incorporate climate change responses into the
evaluation criteria. Climate change response is
already assessed in the current system, but in
actual practice, it has been limited to qualitative
evaluation in terms of the medium- to long-term
targets of individual directors, along with other
ESG initiatives.
Given its focus on marine shipping, MOL emits
large volumes of GHG through the use of fuel on
its vessels. Consequently, I recognize the addition
of indicators related to GHG reductions in both
the short-term and long-term incentive elements
of the remuneration plan to further encourage
countermeasures and, moreover, the disclosure
of those indicators, to be key issues.
Onishi: We have summed up the basic policy
of the president’s succession plan from two
fronts, namely “the approaches, values, and
attitudes that would lead to the results expected
of the president” and “competencies.” The
selection of the president, Mr. Hashimoto, went
very smoothly based on this approach, and I
believe that we have been able to develop well-
functioning mechanisms.
Fujii: A key outcome of the formulation of the
succession plan has been the codification of
the profile and expertise required for the next
president. The members of the Nomination
Advisory Committee and the Board of Directors
now have a clear common understanding of
what is required, including the selection process.
Employing an independent advisory
committee for the nomination of the president
is one way. However, I believe that people from
within the Company would have a better image
of the most suitable person to inherit MOL’s DNA
as a company engaged in social infrastructure,
in addition to the character of the candidates.
At this juncture, I believe that the Nomination
Advisory Committee, consisting of both internal
and outside directors, is the best option for
conducting grounded discussions about
candidate selection
Could you tell us about the formulation of the succession plan for the selection of
the next president?
Q4
When the Nomination Advisory Committee and the Remuneration Advisory
Committee evaluate the president, do you have an arrangement for the president
himself to leave the room to ensure transparency?
Q3
Onishi: Our approach to the skills matrix was to
ask ourselves what are the necessary skills in
the Board of Directors of MOL. Accordingly, we
have also included skills that are not being fully
satisfied by the current members of the Board.
In our consideration of board succession going
forward, we will seek out people who will be
able to fill those gaps in the Board’s skills.
Fujii: At that time, accountability for easy
understanding will be another key consideration.
The skills matrix is simultaneously both a
guideline for selecting directors and a tool
for indicating how the Board of Directors will
use its skills framework to address corporate
governance and business. The matrix must be
used to explain in ways that will engender the
confidence of stakeholders.
Board succession is also one of our key issues.
Having said that, to avoid misunderstandings,
I would add that, in practice, the Nomination
Could you describe the development of the skills matrix and your approaches to
future board succession?
Q5
Etsuko Katsu, Outside Director
Yasushi Arakawa, Asset Management One
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Advisory Committee cannot be involved directly
nor specifically in the individual profiling and
selection of the group of junior executive
candidates who will lead the next generation.
Therefore, I believe it would be more appropriate
for the committee to supervise and give advice on
the framework for board succession. This would
include whether a suitable succession plan has
been prepared, how the group of candidates has
been secured, and what steps the replacement
process will take.
I will also add that, if we consider the
appropriate size of the Board of Directors, I do
not see the need to retain all the skills in-house.
For example, at the moment, we need expertise
regarding current geopolitical risks, but that may
not necessarily be a permanent requirement. In
my view, to meet those skills requirements, a
more flexible and realistic arrangement would
be to utilize external capabilities according to
the situation at hand, for example, by appointing
advisors as necessary.
understanding of other governance systems that
we could adopt, conversely, it also made us realize
that it would be possible to realize the desired
image of the Board of Directors even with our
current system. In conclusion, therefore, we chose
to maintain the current governance system. We
also discovered many areas for improvement, so
we will work on those improvements throughout
fiscal 2023.
Ikeda: Please let me add some extra comments.
In the realization of a Board of Directors focused
on the examination and determination of strategy
and on its supervisory role, we faced the issue
that, realistically, too much time would be taken
up by formalistic agenda items. Under the current
governance system, there are many matters that
require resolutions due to the requirements of the
Companies Act, and a great deal of deliberation is
also devoted to individual investment proposals.
Unless we significantly narrowed down the
proposals presented, it would be impossible
to secure enough time for examination and
determination of strategy and supervision. As
such, we were considering whether we should
address this problem with a change of governance
system or by keeping the current system but
improving the way it is implemented.
The management executives of the
companies we invited each gave us the same
advice. They said that there was no one-size-
fits-all governance system and that we should
consider what would be the best model to
suit our own company. We also learned that
various companies employ different governance
systems, but there is no significant difference in
their goal, namely, a focus on examination and
determination of strategy and on supervision.
After thorough discussions on that basis, we
concluded that a change of governance system
was not necessarily a must at this juncture, and
that, even with our current system of a company
with an Audit & Supervisory Board, we could
still adequately realize our vision for the Board
of Directors by exercising ingenuity in how the
system is implemented.
For my own part, I believe that the Audit
& Supervisory Board has significance as a
“final bulwark.” MOL is not prone to internal
squabbles or scandals, but in the unlikely event
that the Board of Directors were to become
dysfunctional, there is tremendous value in the
existence of the Audit & Supervisory Board as a
brake on that dysfunction.
Onishi: Discussions on changes to the governance
system have taken place in the Corporate
Governance Council established last fiscal year.
Consisting of ten members, namely the three
representative directors, three outside directors,
and four Audit & Supervisory Board members
(internal and outside), it is a small forum that
is conducive to the free expression of opinions.
As a result of discussions of the ideal Board of
Directors we should aspire to, we reaffirmed our
policy to move away from a management focus,
in which the Board’s efforts are concentrated on
the deliberation of individual investments, toward
a focus on the examination and determination of
strategy and its supervisory role.
On that basis, in our consideration of
specific policies, to better understand the real-
world applications, as opposed to textbook-
based knowledge, we invited to the Corporate
Governance Council the management executives
of three companies that have different governance
systems from MOL’s current system of a company
with an Audit & Supervisory Board, and we
held interviews and discussions with them.
While this process did give us a more complete
I understand that you have been considering changes to the governance system to
further enhance the effectiveness of the Board of Directors. Could you tell me how
far those discussions have progressed?
Q6
Ikeda: We narrow investment proposals by their
monetary scale. Single investments worth over
40 billion yen are matters for resolution by the
Board of Directors. In the future, we hope to give
some consideration to creating a mechanism for
delegating the authority for long-term, stable
projects that have a relatively small risk, such as
LNG ships, for example.
Conversely, novel investments, even if they do
not meet the 40-billion-yen threshold, are subject
to proper deliberation. For example, involvement
in the upstream areas of the energy business
and other projects that are key to our portfolio
strategy would not be left up to the executive but
would be deliberated by the Board of Directors,
which would ask about their strategies.
How, specifically, do you narrow down the number of investment proposals
presented to the Board of Directors?
Q7
Masaru Onishi, Outside Director
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Onishi: This is slightly off-topic, but when I was
serving as a director of the International Air
Transport Association (IATA), an international
organization for the aviation industry, the
organization proposed a daring standard of
capping GHG emissions at 2020 levels and
not increasing them after that. As a result, the
aviation industry is now adhering to this rule.
This experience led to my personal conviction
that, in environmental strategy, it is pre-emptive
action that leads to victory, and I have expressed
a variety of opinions at MOL to that effect.
They came to understand my point, which led
to the formulation of the Environmental Vision
2.1 in 2021. What I found wonderful at that time
was that, not only did they appoint an officer
responsible for the environment, but they also
established the Environment & Sustainability
Strategy Division, giving the responsible
officer a team for accountability and action.
I think that MOL is to be commended for its
emphasis on effectiveness of its environmental
responsibilities.
Regarding your question about ONE, as an
equity-method affiliate, MOL holds 31% of the
shares in ONE, and naturally, we certainly do not
take our environmental responsibilities lightly.
However, the extent of responsibility is dictated
by control approach. ONE has established its
own environmental targets and criteria, so, at
this time, our responsibility is to monitor the
company’s progress as a shareholder.
Katsu: MOL has quite a unique arrangement, in
that the chairs of both the Nomination Advisory
Committee and the Remuneration Advisory
Committee and the chair of the Corporate
Governance Council rotate every year. Speaking
from my own experience serving as chair of the
Nomination Advisory Committee in fiscal 2020,
the development of human resources to realize
the next management plan is a key theme for us
both in terms of examination and determination
of strategy and supervision. In the rebuilding of
the business portfolio into market-driven and
stable revenue businesses, or into shipping and
non-shipping business fields, we have seriously
examined how we should allocate our personnel
Do you consider that your equity-method affiliates, including ONE, which is a major
source of GHG emissions, should also be factored into MOL’s own reduction targets?
Q8
Based on future portfolio strategies and social changes, could you tell us about
your human resources plans for the realization of the next management plan?
Q9
resources among the corporate, sales, and
overseas divisions, and what kind of decision-
making process we should employ in that regard.
As part of that examination, on January 1,
2023, a new Human Capital Strategy Division
was established as an organization to promote
and manage human resources strategies to
support future business growth. This division
will now play a central role in efforts toward
HR development by appointing the right
people to the right positions under centralized
management, including people employed by
Group companies and overseas locations.
Going forward, we will increase the quantity
and quality of our human resources alongside
the expansion of the business portfolio. In that
process, our priority will be to ensure it aligns
with our management plan.
At the same time, in the area of diversity
management, such as the promotion of foreign
nationals and the empowerment of women in
the workplace, we will publicly set KPIs and
work toward achieving them. We will also
similarly address areas such as training, internal
advertising for vacant positions, and employee
engagement measures. While feeding these areas
back into the medium-term management plan,
we will need to further pursue HR development
in a way that contributes to the medium- to long-
term enhancement of corporate value.
Fujii: Since 2017, MOL has implemented a rolling
management plan that is updated annually,
focusing on fiscal 2027 targets. Through this
approach, we have finally laid the groundwork
to embark on a full-scale medium- to long-
term management plan. The longer the term
of a plan, the more efforts are required to
convince stakeholders. In this respect, we will
establish a clear vision, as well as action plans
and KPIs for each phase to serve as milestones
towards achieving that vision, to ensure that
the plan presents a full package that is worthy
of stakeholders’ trust.
Katsu: In recent years, the situation in society
has been extremely unpredictable. This is the
reason for MOL’s adoption of highly flexible
rolling management plans. However, we are
now at the stage where we can declare a firmer
medium- to long-term plan. Management will
steer it properly, and I believe that our role as
outside directors in supervising management
will become more important.
Ikeda: For some years now, we have been
conducting Deliberation on Corporate Strategy
and Vision session ten or so times a year. This
is where a certain theme, such as a specific
Your new medium-term management plan will be launched in fiscal 2023.
As outside directors, what kind of roles do you see yourselves playing in that plan?
Q10
Yasushi Kondo, Resona Asset Management
Masamichi Fujisawa, BlackRock Japan
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MOL REPORT 2023
business, is selected, and we devote about 1.5
hours of the 3-hour Board of Directors meeting
to debating strategy and vision related to it. In
fiscal 2022, this framework was largely used to
discuss the management plan.
Our very first task in that process was
to discuss the broad framework of the
management plan in the Board of Directors, and
the executive officers have now proceeded to
develop the specifics based on the discussion
results. The work is proceeding, with the specific
proposals developed by the executive officers
being presented for Board of Directors feedback
on a relatively short cycle.
Ikeda: The excellence of ROIC as an indicator is
beyond dispute. Until now, shipping has been at
the center of our business, and there were only
small differences between individual areas, which
meant that simple ROA-based management was
sufficient for our purposes. However, given that
we will be strengthening a wide range of non-
shipping businesses, we will need an indicator
that shows the extent of return against the size
of the balance sheet that is used as a yardstick
for comparisons across businesses. We hope to
examine this point, including the expansion of the
ROA concept, as a key issue going forward.
Onishi: On another topic related to risk
management, for the past several years, MOL
has been engaged in the interesting initiative of
“megatrend prediction.” These predictions are
based on the World Energy Outlook (WEO) of
the International Energy Agency (IEA), coupled
with MOL’s own expertise. A variety of factors,
including environmental factors, economic
factors, and demographics, have a tremendous
impact on our business. The extent to which
society will or is able to demand environmental
actions will have a great impact on the marine
transport business. Given the wide range of the
predictions we make, they could aid in assessing
the risk of our owned vessels turning into
stranded assets, which is an issue of concern
for investors. However, I believe that there is
still a long way to go in utilizing them for risk
management. There has been visible progress
made during my involvement as an outside
director, and I look forward to seeing further
advances in this regard.
Finally, could you tell us your thoughts on risk management and on the upgrading
of business profitability management, including the introduction of ROIC?
Q11
Junichiro Ikeda, Representative Director, Chairman Executive Officer
Nariaki Hirano, Nomura Asset Management
On the conclusion
of the Governance
Meeting
This was the first time that an opportunity was arranged for institutional
investors and outside directors to hold direct dialogue. In my position as chair of
the Corporate Governance Council, several points drew my notice.
One is that, thanks to the clear questions that were asked, I was able to
reaffirm what areas each of the outside directors emphasize as they engage in
the Board of Directors.
I also noticed that MOL’s Board of Directors is making steady and confident
progress towards strengthening corporate governance, including risk-taking.
However, this dialogue also clearly confirmed for me their awareness of the
many issues that remain to be addressed, which I feel has been a tremendous
outcome of this initiative.
Outside Director (Masaru Onishi, FY2022 Chair of the Corporate Governance Council)
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Corporate Governance
In addition, we see “governance and compliance to support businesses” as one of our five
“sustainability issues” (materiality). In doing this, we aim to ensure through enhancement of
corporate governance and thorough compliance in order to ensure transparency in Groupwide
management, build foundations for its initiatives on social issues through business activities,
and establish sustainable value chains based on consideration for human rights, safety, and the
environment. Such efforts are important in that they serve as a foundation for tackling other
sustainability issues. In accordance with our belief that putting our management plan into action,
supported by the Group’s Corporate Mission and Group Values, will help lead to the resolution of
sustainability issues, which, in turn, will improve our corporate value and help us realize the Group
Vision, we will continue to make proactive efforts to improve corporate governance moving forward.
MOL Group Three Basic Principles of Corporate Governance
Article 1 (Framework and Operation)
Based on the MOL Group Corporate Mission, the MOL Group Vision, and the MOL Group Values, Code
of conducts (MOL CHARTS), we, the MOL Group, grow globally by enhancing corporate governance
and leveraging the collective strengths of the MOL Group.
Article 2 (System)
We, the MOL Group, have established a highly effective corporate governance system befitting a
strong and resilient corporate group that is growing globally to increase corporate value over the
medium and long term.
Article 3 (Dialogue)
We, the MOL Group, provide new value through highly transparent dialogue with all of our
stakeholders, including shareholders, investors, employees and customers.
Corporate Governance Organizational Structure
We believe that the appropriate form of governance should achieve legality, appropriateness, and
efficiency of business operations by ensuring an effective supervisory framework for the Board of
Directors. This is accomplished by having a mutual supervision and check mechanism among inside
directors (three out of five inside directors also serve as executive officers as of June 20, 2023) who
carry out business operations and by forming a Board of Directors that consists of inside directors
who also carry out business operations and nonexecutive inside directors and outside directors
who specialize in strategy deliberation functions and supervisory functions. The structure also
secures the audit function of the Audit & Supervisory Board, which is independent of the Board of
Directors. Based on this view, MOL has become a company with an Audit & Supervisory Board as
prescribed in the Companies Act. The Board of Directors, by its resolution, has established a basic
policy for developing a system to secure the properness of operations (internal control system). The
MOL Group’s officers and employees, under the president serving as the chief executive officer for
management, carry out business operations in accordance with the management policy set by the
Board of Directors and the above-mentioned basic policy, while being subject to supervision by the
Board of Directors and audits by the Audit & Supervisory Board.
Under the slogan of “Taking the leap to becoming a global social infrastructure company,” the
Group management, whose goal is to expand its footprint in a variety of business domains
beyond its conventional marine transport business, must adeptly set our course by accurately
grasping the business environment, confronting risks appropriately, and effectively utilizing our
management resources by maintaining our offense-defense balance. We believe that the essentials
of corporate governance are fostering sustainable growth and enhancing our corporate value by
making decisions promptly and boldly, guided by appropriate risk management, while ensuring the
transparency and fairness of management by carefully considering the viewpoints of our diverse
stakeholders and other various social requests.
Based on this belief, MOL has adopted, and announced to its shareholders, investors, customers,
and all other stakeholders, the “MOL Group Three Basic Principles of Corporate Governance,” which
are described below. These Basic Principles indicate the MOL Group’s basic policy on corporate
governance and matters that it considers universally important as behavioral guidelines. MOL has
also adopted the MOL Group Corporate Governance Policy, which systematically describes policies
on specific initiatives based on the spirit of the Basic Principles.
Our Basic Concept of Corporate Governance
Please visit our website for details on our basic concept of corporate governance.
https://www.mol.co.jp/en/sustainability/governance/corporate/policy/pdf/governance-policy.pdf
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Corporate Governance Organization
(as of June 20, 2023)
Chairman
Male
Female
Elect and appoint/Dismiss
Elect and appoint/Dismiss
Elect and appoint/
Supervise
Elect and appoint/
Supervise
Submit/report basic
management policies and
other issues for discussion
Provide direction
on important
business issues
Submit to the Executive Committee
after preliminary deliberations
Submit for discussion and/
or report on important business
and other issues
Submit for discussion and/
or report on important business and
other issues
Elect and appoint/
Dismiss
Business audit/
Accounting audit
Business audit/Accounting audit
Accounting audit
Recommend
Recommend
Instruct
General Meeting of Shareholders
Committees under the Executive Committee
BLUE ACTION Committee, Investment & Strategy Committee,
Environment & Sustainability Committee, Improvement of Work Efficiency Committee,
Operational Safety Committee, Compliance Committee
Audit & Supervisory Board (Total: 4)
Nomination Advisory
Committee (Total: 6)
Chair of committee:
Etsuko Katsu
Divisions/Branches/Vessels/Group companies
Remuneration Advisory
Committee (Total: 6)
Chair of committee:
Masaru Onishi
Audit & Supervisory Board Members’ Office
Board of Directors’ Office
Accounting Auditor
Corporate Audit Division
Executive directors: 3
Executive officers: 24
Group executive officers: 5
Executive officers: 7
Outside directors: 4 Internal directors: 2
Outside directors: 4
Internal directors: 2
CEO
Report / Advise
Internal members: 2
Outside members: 2
Board of Directors (Total: 9)
Outside directors: 4
Internal directors: 5
Executive directors: 3
(including the CEO)
Report
Collaborate
Collaborate
Audit plan/Audit report
Corporate Governance Council
(Total: 12)
Chair of council: Hideto Fujii
Executive officers (Total: 32)
Executive Committee (Total: 10)
Outside directors: 4
Internal directors: 4
Outside Audit & Supervisory
Board members: 2
Internal Audit & Supervisory
Board members: 2
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MOL REPORT 2023
Board of Directors and Audit & Supervisory Board Members
(as of June 20, 2023)
Director, Chairman of the Board
Junichiro Ikeda
Number of the Company’s shares held: 122,591 shares
Attendance at the Board of Directors’ meetings: 15 of 15
(Attendance rate: 100%)
Number of years as Director: 10 years
Director
Junko Moro
Number of the Company’s shares held: 34,856 shares
Attendance at the Board of Directors’ meetings: —
Number of years as Director: —
Director
Hisashi Umemura
Number of the Company’s shares held: 11,448 shares
Attendance at the Board of Directors’ meetings: —
Number of years as Director: —
Representative Director
Takeshi Hashimoto
Number of the Company’s shares held: 72,291 shares
Attendance at the Board of Directors’ meetings: 15 of 15
(Attendance rate: 100%)
Number of years as Director: 8 years
Representative Director
Toshiaki Tanaka
Number of the Company’s shares held: 41,013 shares
Attendance at the Board of Directors’ meetings: 15 of 15
(Attendance rate: 100%)
Number of years as Director: 3 years
Outside Director (Independent Officer)
Hideto Fujii
Number of the Company’s shares held: 33,995 shares
Attendance at the Board of Directors’ meetings: 15 of 15
(Attendance rate: 100%)
Number of years as Director: 7 years
Outside Director (Independent Officer)
Masaru Onishi
Number of the Company’s shares held: 9,895 shares
Attendance at the Board of Directors’ meetings: 15 of 15
(Attendance rate: 100%)
Number of years as Director: 4 years
Outside Director (Independent Officer)
Etsuko Katsu
Number of the Company’s shares held: 22,295 shares
Attendance at the Board of Directors’ meetings: 15 of 15
(Attendance rate: 100%)
Number of years as Director: 7 years
Outside Director (Independent Officer)
Mitsunobu Koshiba
Number of the Company’s shares held: —
Attendance at the Board of Directors’ meetings: —
Number of years as Director: —
Nomination Advisory
Committee member
Remuneration Advisory
Committee member
Internal Directors
Outside Directors
Please visit our website for details on the positions and duties of executive officers and Group executive officers.
https://www.mol.co.jp/en/corporate/executive/index.html
*Only important concurrent positions and certification registration years have been included in the resumes of outside directors and outside Audit & Supervisory Board members.
Apr. 1979 Joined Mitsui O.S.K. Lines, Ltd.
Jun. 2004 General Manager of Human Resources
Division
Jun. 2007 General Manager of Liner Division
Jun. 2008 Executive Officer
Jun. 2010 Managing Executive Officer
Jun. 2013 Director, Senior Managing Executive Officer
Jun. 2015 Representative Director, President,
Chief Executive Officer
Apr. 2021 Representative Director, Chairman
Executive Officer
Apr. 2023 Director, Chairman of the Board
(to present)
Apr. 1986 Joined Mitsui O.S.K. Lines, Ltd.
Jun. 2014 General Manager of Secretaries Office
Apr. 2017 Associate General Manager of Corporate
Planning Division and General Manager
of One MOL Business Strategy Execution
Office, Corporate Planning Division
Apr. 2018 General Manager of Corporate Marketing
Division
Apr. 2019 Executive Officer
Apr. 2021 Managing Executive Officer
Apr. 2023 Adviser
Jun. 2023 Director (to present)
Apr. 1982 Joined Mitsui O.S.K. Lines, Ltd.
Jun. 2008 General Manager of LNG Carrier Division
Jun. 2009 Executive Officer, General Manager of LNG
Carrier Division
Jun. 2011 Executive Officer
Jun. 2012 Managing Executive Officer
Jun. 2015 Director, Managing Executive Officer
Apr. 2016 Director, Senior Managing Executive Officer
Apr. 2019 Representative Director, Executive Vice
President Executive Officer
Apr. 2021 Representative Director, President, Chief
Executive Officer (to present)
Apr. 1984 Joined Mitsui O.S.K. Lines, Ltd.
Jun. 2011 General Manager of Iron Ore & Coal
Carrier Division
Jun. 2014 Executive Officer, General Manager of Iron
Ore & Coal Carrier Division
Jun. 2015 Executive Officer
Apr. 2017 Managing Executive Officer
Jun. 2020 Director, Managing Executive Officer
Apr. 2021 Director, Senior Managing Executive Officer
Apr. 2022 Representative Director, Executive Vice
President Executive Officer (to present)
Jun. 2015 Adviser, Sumitomo Corporation
Jun. 2016 Outside Director, Mitsui O.S.K. Lines, Ltd.
Jun. 2017 Councilor, Takanashi Foundation for
Historical Science
Apr. 2003 Professor, School of Political Science and
Economics, Meiji University
Feb. 2015 Member, Council for Science, Technology
and Innovation, Ministry of Education,
Culture, Sports, Science and Technology
Jun. 2016 Outside Director, Mitsui O.S.K. Lines, Ltd.
Apr. 2018 Chairman of Fund Management Advisory
Committee, The Japan Foundation
Mar. 2019 Outside Director (Audit and Supervisory
Committee Member), Dentsu Group Inc.
Apr. 1992 Joined Mitsui O.S.K. Lines, Ltd.
Apr. 2018 General Manager of Finance Division
Apr. 2021 Executive Officer
Apr. 2022 Managing Executive Officer
Jun. 2023 Director, Managing Executive Officer
(to present)
Apr. 2013 Trustee, KEIZAI DOYUKAI (Japan
Association of Corporate Executives)
Jun. 2015 Trustee, International University of Japan
Jul. 2018 Visiting Professor, Toyo University
Jun. 2019 Outside Director, TEIJIN LIMITED
Jun. 2019 Outside Director, Mitsui O.S.K. Lines, Ltd.
Feb. 2021 Senior Advisor, Alton Aviation Consultancy
Japan Co., Ltd.
Jun. 2021 Outside Director, Kadoya Sesame Mills inc.
Jun. 2022 Outside Director, Benesse Holdings, Inc.
Jun. 2019 Outside Director, Idemitsu Kosan Co., Ltd.
Mar. 2021 Outside Director, A Holdings Corporation
Jun. 2021 Honorary Advisor, JSR Corporation
Aug. 2021 Outside Director, TBM Co., Ltd.
Mar. 2023 Outside Director, Rapidus Corporation
Jun. 2023 Outside Director, Mitsui O.S.K. Lines, Ltd.
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MITSUI O.S.K. LINES
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Outside Audit & Supervisory Board
Member (Independent Officer)
Satoru Mitsumori
Attendance at the Board of Directors’ meetings:10 of 10
(100%)
Attendance at the Audit & Supervisory Board Members’
meetings: 10 of 10 (100%)
Number of years as Outside Audit & Supervisory Board
Member: 1 year
Audit & Supervisory Board Member
Masanori Kato
Attendance at the Board of Directors’ meetings:15 of 15
(Attendance rate: 100%)
Attendance at the Audit & Supervisory Board Members’
meetings: 14 of 14 (Attendance rate: 100%)
Number of years as Audit & Supervisory Board Member:
2 years
The role and responsibility of the Group’s Board of Directors is to help improve the Group’s corporate
value by implementing the strategy review and supervision cycle with regard to basic management
policies (such as the Mission, Vision, and Values) and matters of importance (management plans,
business strategy, and individual cases of important business execution).
As laid out in BLUE ACTION 2035, our aim is to grow by expanding our footprint to areas beyond
our conventional marine transport domain which is our foundation; however, we believe that this is
something that is only made possible through the taking and managing of risk.
The Board of Directors formulates basic management policies based on dialogue with executives,
upon which it duly deliberates and makes decisions with regard to important management matters.
The Board also monitors and makes evaluations as to whether strategies are being properly
implemented without a hitch, whether or not excessive risk has been taken, and whether the risk-
management system is functioning as it should.
In order to fulfill the aforementioned roles and responsibilities, the composition of the Board of
Directors is decided based on experience, expertise, skills, and matters of diversity like gender as
deemed desirable for the Board of Directors. From June 2023, internal Directors who concurrently
serve as executive officers have been limited to just the CEO, COO, and CFO. Furthermore, in order
to improve corporate governance, we have increased the number of outside directors by one. The
Chairman of the Board of Directors shall no longer hold the right of representation, nor serve as an
executive officer, but shall instead focus on demonstrating the functions of the Board of Directors. In
addition, one internal director (non-executive director) shall work to improve the effectiveness of the
Board of Directors through supervision of management and business execution in accordance with
his extensive experience within the Group.
Internal Audit & Supervisory Board Members
Outside Audit & Supervisory Board Members
Approach to the Board of Directors
* Only important concurrent positions and certification registration years have been included in the resumes of outside directors and outside Audit & Supervisory Board members.
Establishment of Board of Directors Office
On April 1, 2023, the Board of Directors Office was established with the aim of helping reform and
raise the quality of the roles of the Board of Directors and to help better demonstrate the Board’s
functions. The Board of Directors Office serves as the foundation to ensure that the necessary and
adequate levels of information are provided to each member of the Board and that effective and
constructive discussions take place.
Audit & Supervisory Board Member
Yutaka Hinooka
Attendance at the Board of Directors’ meetings:15 of 15
(Attendance rate: 100%)
Attendance at the Audit & Supervisory Board Members’
meetings: —
Number of years as Audit & Supervisory Board Member:
—
Outside Audit & Supervisory Board
Member (Independent Officer)
Fumiko Takeda
Attendance at the Board of Directors’ meetings: —
Attendance at the Audit & Supervisory Board Members’
meetings: —
Number of years as Outside Audit & Supervisory Board
Member: —
Nov. 1985 Joined Mitsui O.S.K. Lines, Ltd.
Jun. 2013 General Manager of Marine Safety Division
Apr. 2016 Executive Officer
Apr. 2017 Managing Executive Officer
Apr. 2021 Adviser
Jun. 2021 Audit & Supervisory Board Member, Mitsui
O.S.K. Lines, Ltd. (to present)
Apr. 1993 Registered as an attorney at law at Daini
Tokyo Bar Association Joined Asahi Law
Offices (currently serves as Managing
Partner)
Apr. 2008 Family Affairs Conciliator, Tokyo Family
Court
Apr. 2018 Audit & Supervisory Board Member, Kur &
Hotel Co., Ltd.
Jun. 2022 Outside Audit & Supervisory Board
Member, Mitsui O.S.K. Lines, Ltd.
Apr. 2022 Professor, Graduate School of Business
Administration, Keio University
Sep. 2022 Member, Antitrust Association, Japan Fair
Trade Commission
Jun 2023 Outside Audit & Supervisory Board
Member, Mitsui O.S.K. Lines, Ltd.
Apr. 1985 Joined Mitsui O.S.K. Lines, Ltd.
Jun. 2012 General Manager of Liner Division
Apr. 2016 Executive Officer, General Manager of Liner
Division
Apr. 2018 Executive Officer
Apr. 2019 Managing Executive Officer
Jun. 2021 Director, Managing Executive Officer
Apr. 2022 Director, Senior Managing Executive Officer
Apr. 2023 Director
Jun. 2023 Audit & Supervisory Board Member
(to present)
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The Nomination Advisory Committee has been established to heighten the objectivity, transparency,
and accountability of the selection procedures of directors and Audit & Supervisory Board
members. The committee submits reports to the Board of Directors after selecting candidates in
light of standards established by the committee on gender equality and other issues as well as the
experience, expertise, and skills deemed desirable for members of the Board of Directors, which
were identified in the form of skills matrix. (Reports on candidates for positions in the Audit &
Supervisory Board are submitted upon receiving the consent of the Audit & Supervisory Board.) With
due consideration for the reports submitted by the Nomination Advisory Committee, the Board of
Directors determines candidate directors and candidate Audit & Supervisory Board members.
Furthermore, upon the formulation and disclosure of standards for determining independence,
independent outside directors are then selected based on factors including the status of any
concurrent positions they may hold with other listed companies. The Board of Directors is comprised
of an appropriate selection of independent outside directors and non-executive directors.
The Nomination Advisory Committee discusses what to identify and select as the particular types of
experience, expertise, and skill (hereinafter “Experience, etc.”) desired for realizing the Company’s
target corporate profile. The items have been selected as detailed in the table below. We will
continue to review these items in accordance with the changes in the business environment.
In addition, training opportunities will be provided for directors and Audit & Supervisory Board
members, and advisors will be appointed to improve the functions of the Board as necessary.
To ensure the appointment of a suitable CEO in a timely and appropriate manner, the Company
formulated a CEO succession plan that establishes the requirements and selection process in
relation to the position of CEO as well as a development plan for successor candidates. Based on the
succession plan, the Nomination Advisory Committee deliberates proposals for the next CEO, including
the re-appointment and dismissal of the incumbent CEO, and submits reports to the Board of Directors.
Standards for Appointing Directors
a) Personnel who are able to contribute to enhancement of the corporate value of the Company
based on a wealth of experience and knowledge
b) Personnel who are able to make management decisions globally from a broad-ranged perspective
and foresight
c) Personnel with high ethical standards and solid common sense
Standards for Appointing Audit & Supervisory Board Members
a) Personnel who have an appropriate set of experience, qualification, ability, and expertise
b) Personnel who possess a high degree of financial and accounting knowledge (more than one member)
Standards for Appointing Directors and Audit & Supervisory Board Members
Specific Experience, Expertise, and Skills Expected of Members of the Board of Directors
CEO Succession Plan
Name
Position
Experience, etc., considered important for
corporations
Experience, etc., considered important for
corporations supporting social infrastructure
Corporate
management
Finance /
Accounting
Legal affairs /
Risk
management
ESG
Human
resources /
Diversity
Safety
Technology
Marketing /
Business
strategy
Global
business
Junichiro
Ikeda
Director
Takeshi
Hashimoto
Representative
Director
Toshiaki
Tanaka
Representative
Director
Junko
Moro
Director
Hisashi
Umemura
Director
Hideto
Fujii
Director (Outside)
Etsuko
Katsu
Director (Outside)
Masaru
Onishi
Director (Outside)
Mitsunobu
Koshiba
Director (Outside)
Masanori
Kato
Audit & Supervisory
Board Member
Yutaka
Hinooka
Audit & Supervisory
Board Member
Satoru
Mitsumori
Audit & Supervisory
Board Member
(Outside)
Fumiko
Takeda
Audit & Supervisory
Board Member
(Outside)
For details on the Independence Criteria for Outside Officers, please visit the following data on our website.
Independence Criteria for Outside Officers, page 19, Notice of Convocation of the Ordinary General Meeting of Shareholders for the Fiscal Year 2022
https://www.mol.co.jp/en/ir/stock/gms/pdf/notice23.pdf
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MOL REPORT 2023
With the aim of further increasing the effectiveness of the Board of Directors and its subordinate
committees—namely, the Nomination Advisory and Remuneration Advisory committees and the Corporate
Governance Council—the Company conducts an annual survey, which seeks self-evaluations from each
director and Audit & Supervisory Board member regarding the content of agenda items and deliberations,
the contribution of each member of the Board of Directors, and the management and administration of its
activities. The results of this analysis and evaluation as well as the identification of issues and the analysis
and implementation of improvement measures are considered in making the next year’s programs.
The Company’s Board of Directors deliberates overall issues related to the corporate management
plan and the MOL Group Vision as Deliberation on Corporate Strategy and Vision at Board meetings,
thus ensuring that individual issues are executed in accordance with management policy and setting
the direction of businesses/projects. The Company formulates agenda items based on the most
important management challenges identified through discussions of the Board of Directors, the
Nomination Advisory and Remuneration Advisory Committees, and the Corporate Governance Council.
Initiatives to Enhance the Effectiveness of the Board of Directors
Deliberation on Corporate Strategy and Vision
Fiscal 2023
Initiatives
(1) Decide on the frequency and main themes of monitoring for Core KPIs of the corporate
management plan (financial/non-financial)
(2) Build company-wide risk management systems including scenario analysis of emerging risks
and other issues
(3) Establish a road map for the realization of a Board of Directors whose composition is based on
the skills matrix
(4) Hold discussions regarding inspections of the current remuneration system and the
incorporation of new ESG KPIs into the system
Summary
of Survey
Implementation
Results of
Fiscal 2022
Evaluation
Respondents
Fiscal 2022 12 officers, comprising all directors (five internal directors and three independent outside
directors) and all Audit & Supervisory Board members (two full-time Audit & Supervisory Board
members and two independent outside Audit & Supervisory Board members)
Items for Which Effectiveness Was Confirmed
(1) The Board of Directors deliberated individual issues based on the MOL Group Corporate Mission,
the MOL Group Vision, and the MOL CHARTS values as well as the general goals of the corporate
management plan.
(2) With regard to corporate strategy and vision in particular, the Board of Directors secured sufficient
time for discussion of management policies and business strategies, and directed the execution of
individual issues to ensure consistency with management policies and business strategies.
(3) The deliberations of the Nomination Advisory and Remuneration Advisory Committees were
reported in a transparent and objective manner to the Board of Directors. In addition, both advisory
committees and the Corporate Governance Council convened with an appropriate frequency and
progress was achieved.
(4) Through efforts to improve its operations, the Board of Directors is contributing to securing a
conducive environment for lively and efficient deliberations.
Issues Recognized by the Board of Directors
(1) Establishment of systems for the Board of Directors to receive reports and monitor KPI and
milestones relating to the management plan
(2) Initiating discussions about sustainability not only from a risk perspective, but also with the
objective of discovering revenue opportunities
(3) Reconsideration of the board succession plan, including development plans and diversity
(4) Reconsideration of ESG-related KPIs that should be incorporated into the remuneration system.
Implementation and Evaluation Method
February 2022 Provision of effectiveness evaluation survey to all directors and Audit & Supervisory
Board members, receipt of responses from all respondents
March
2022 Discussion at the Corporate Governance Council based on the results
April
2022 At a meeting of the Board of Directors, items for which effectiveness was established,
items identified as issues, and items to be addressed in fiscal 2023 were reported,
details of which were confirmed by the directors and Audit & Supervisory Board
members.
Main Items in Self-Assessment Survey
Overall assessment of the Board of Directors (composition, administration, management plans, overall
risk, nomination, and remuneration), effectiveness of deliberation on corporate strategy and vision,
effectiveness of the Nomination Advisory and Remuneration Advisory Committees and the Corporate
Governance Council, and mutual supervision and monitoring among directors and Audit & Supervisory
Board members.
Main Agenda Items of Deliberation on Corporate Strategy and Vision Conducted by the Board of Directors
in Fiscal 2022
Month and Year
Agenda Item
2022
July
Containership business
August
Outline of medium-term corporate management plan of DAIBIRU; company-wide risk management
enhancement project
September
Direction of the next corporate management plan
October
Review of Rolling Plan 2022; direction of new human resource strategy
November
Logistics business
December
Overall image of the next corporate management plan
2023
January
Company-wide in-depth risk management project (management of emerging risks)
April
Management of emerging risks (individual scenarios)
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MOL REPORT 2023
The Corporate Governance Council has been established fiscal 2021 under the Board of Directors to
serve as a forum for facilitating unrestricted discussion while incorporating outside knowledge with
respect to the overall direction of the entire MOL corporate governance. Appointed by the Board of
Directors, the council’s members comprise four internal directors, all four outside directors, and all
four Audit & Supervisory Board members. In addition to being chaired by an outside director, the
council is able to appoint outside experts, depending on the issue at hand, and have them participate
in deliberations, giving the council a high degree of expertise and objectivity.
MOL Group may hold shares for the purpose of maintaining and strengthening relationships with
important business partners or to contribute to the increase in MOL Group's corporate value and
sustainable growth over the medium and long term. To determine the appropriateness of holding
each stock, the Board of Directors annually evaluates and verifies the appropriateness of the
purposes MOL Group has for holding each stock and the profitability of continuing to hold each
stock based on the cost of capital. When the Board identifies stock where the policy of continuing
to hold the stock is not considered reasonable, MOL Group will reduce or terminate its holding
of that stock. Across the period fiscal 2019 through 2022, the Company reduced its holdings of
27 stocks, equivalent to ¥42.0 billion. As of March 31, 2023, the Company holds approximately 40
cross-shareholdings, equivalent to approximately ¥47.0 billion. However, as a result of quantitative
evaluation (benefits associated with shareholdings, including dividends) and qualitative evaluation
(verification of meaning of holding shares based on transaction status), the Board of Directors has
resolved to sequentially sell approximately ¥3.0 billion of these shareholdings in accordance with
market trends.
The Nomination Advisory Committee and the Remuneration Advisory Committee are established as
arbitrary organizations under the Board of Directors. Both Committees are chaired by an outside
director and consist of all four outside directors, the chairman and the president, with outside
directors making up the majority, to make the supervision of the executive directors by the outside
directors more effective.
The Nomination Advisory Committee deliberates on the appointment and dismissal of
directors and executive officers and the criteria for deciding their appointment and dismissal.
The Remuneration Advisory Committee examines how the remuneration for officers, including
incentives for the long-term enhancement of corporate value, should be structured from an
objective standpoint with a focus on the stakeholders’ perspective. In addition to the members of the
Committees, outside Audit & Supervisory Board members are also permitted to state their opinions
by attending the Committee meetings to enable them to understand the process of deliberations.
The Board of Directors passes the necessary resolutions by respecting the contents of the reports
submitted by both Advisory Committees.
Main Agenda Items Deliberated by the Advisory Committees in Fiscal 2022
Nomination Advisory Committee (convened seven times)
Chair of committee: Hideto Fujii (Outside Director)
Main Agenda Items: Board succession plan
Selection of next President based on the succession plan for the President,
and consideration of a candidate for successor in the event of an emergency
Election of directors, Audit & Supervisory Board members, and executive
officers for FY2023 (Relinquishment of right of representation by the Chairman
of the Board, retirement of executive officers, selection of non-executive
directors, and addition of one outside director)
Review of advisory system and other matters
Main Agenda Items Deliberated by the Corporate Governance Council
(convened seven times in fiscal 2022)
Chair of council:
Masaru Onishi (Outside Director)
Main Agenda Items: Role and functions desired of the Board of Directors
Institutional design
MOL Group Three Basic Principles of Corporate Governance and MOL Group
Corporate Governance Policy
Training policy for directors and Audit & Supervisory Board members and
improvement in the operation of Board of Directors, and other matters
Remuneration Advisory Committee (convened nine times)
Chair of committee: Etsuko Katsu (Outside Director)
Main Agenda Items Details of payment of single fiscal year performance-based compensation for
directors and long-term target contribution-based compensation in FY2021,
and remuneration for directors in FY2022
Revision of the remuneration plan for non-executive directors
Analysis of the peer group to ensure the appropriateness of remuneration levels
Evaluation of officer remuneration plans introduced in FY2021
How to establish and evaluate qualitative targets for Chairman and President
and other matters
Nomination Advisory Committee and Remuneration Advisory Committee
Corporate Governance Council
Policy on Cross-Shareholdings
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MOL REPORT 2023
Upon receiving the approval of the General Meeting of Shareholders convened in June 2022, the
Company provided remuneration in the form of Company stock to non-executive directors, including
outside directors.
Given the business characteristics of marine transport, contribution to the enhancement of
both short-term performance and medium- to long-term performance is expected. Accordingly,
the remuneration of executive directors comprises monthly remuneration, single fiscal year
performance-based remuneration, and long-term target contribution-based remuneration. (The
Company changed to the current remuneration plan in fiscal 2021.)
Remuneration of Executive Directors
Remuneration of Non-Executive Directors
Remuneration for Directors and Audit & Supervisory Board Members in Fiscal 2022
Model Remuneration Assuming Achievement of Performance Targets
Aim of the Revision
Main Features of the Revision
Fixed remuneration
60%
To incentivize sustained enhancement of the Company’s
corporate value and further align the interests of
directors with those of shareholders
Number of shares granted not linked to business
performance
Restriction on transfer of shares until retirement
Monthly remuneration
(cash) 60%
Fixed cash remuneration 100.0%
Fixed cash remuneration 90.0%
Before revision
After revision
Single fiscal year performance-
based remuneration
(cash) 20%
Long-term target contribution-
based remuneration
(stock) 20%
Restricted stock remuneration 10.0%
Variable remuneration
40%
Note: The above diagram is an approximation that has been calculated premised on certain Company performance and share price
levels. The above percentages change in accordance with the Company’s business performance and share price.
Note: The ratio of restricted stock remuneration for the Chairman of the Board of Directors will be a little less than 30.0%.
Notes:
1. The above remuneration includes remuneration related to one Audit & Supervisory Board member who was an outside Audit & Supervisory
Board member and who resigned at the conclusion of the Ordinary General Meeting of Shareholders convened on June 21, 2022.
2. Of the above, remuneration paid to six outside directors totaled ¥71 million.
3. Amounts of less than ¥1.0 million have been rounded down to the nearest ¥1.0 million.
Notes: Evaluated based on the ratio of ordinary profit to planned value, considering the degree of achievement of safe operations KPI.
For Directors in charge of Business Headquarters and Headquarters’ business divisions, this figure also reflects the Business
Headquarters’ or business division’s rate of achievement of the ordinary profit to planned value ratio.
The Company acknowledges that there are certain views against providing stock remuneration to non-
executive directors, as they are expected to exercise the function of monitoring the Board of Directors.
The Company believes that by holding a certain number of shares, non-executive directors can
have shareholders’ perspective, and that can be an appropriate incentive for exercising the monitoring
function. Further, the structure of stock remuneration for non-executive directors prevents the
recipients from profiting off short-term trading of the stocks or receiving higher remuneration based
on deliberately inflated short-term results, due to the stocks having restrictions on transfer and being
delinked from performance (the amount received is not linked to performance).
Long-Term Target Contribution-Based Remuneration
Total
shareholder
return*
(growth rate versus
TOPIX and growth rate of
total shareholder return
versus competitors)
30%
—
Growth rate versus TOPIX: 124.84%
¥118.0
million
ROE
40%
Fiscal 2022 (initial projection): 35.0%
Fiscal 2027 (target): 9.0 -10.0%
49.80%
Targets for
individual
directors
30%
—
Portfolio strategy: Strengthening the
non-shipping businesses, including
the (oil & gas), offshore wind power
generation, logistics, and real property
businesses (e.g., conversion of
MOL Logistics into a wholly owned
subsidiary)
DX: Ramping up DX initiatives
(implementation of initiatives for
chartered vessel owners, etc.)
Governance: Continued efforts to
strengthen governance (introduction of
management of emerging risks, etc.)
Category
Number of
people
Total
remuneration
(millions of yen)
Total remuneration, by type (millions of yen)
Basic remuneration
Monthly remuneration
(cash)
Performance-based
remuneration
Single fiscal year performance-
based remuneration (cash)
Non-monetary remuneration
Performance-linked stock
remuneration
(stock-based)
Non-monetary remuneration
Non-performance-linked stock
remuneration
(stock-based)
Directors (of whom outside directors)
8(3)
1,096(45)
301(41)
673(—)
118(—)
4(4)
Audit & Supervisory Board members
(of whom outside Audit & Supervisory
Board members)
5(3)
98(26)
98(26)
—(—)
—(—)
—(—)
Total
(of whom outside directors or outside
Audit & Supervisory Board members)
13(6)
1,194(71)
399(67)
673(—)
118(—)
4(4)
KPI
Weight
Targets and KPIs of Rolling Plan 2022 and the
MOL Sustainability Plan
Fiscal 2022 Results
Calculation
Results
and Total
Payment
Single Fiscal Year Performance-Based Remuneration
(A) Consolidated
ordinary profit
(loss)
See
notes
below.
¥525.0 billion
¥811.5 billion
¥673.0
million
(B) Ordinary
profit (loss) by
segment
Dry bulk business: ¥30.0 billion
¥57.6 billion
Energy and offshore businesses: ¥22.0
billion
¥39.5 billion
Product transport and real property
businesses: ¥477.0 billion
Product transport: ¥705.4 billion
Real property: ¥8.1 billion
Associated businesses: ¥(500) million
¥(500) million
(C) Degree of
achievement of
safe operations
indicators
4 ZEROES violations: 0
1
Downtime frequency rate: <-1.00 incident
per ship per year
0.33 incident per ship per year
Average downtime: <-24.00 hours per ship
per year
12.18 hours per ship per year
Lost time injury frequency: <-0.50 injuries
0.17
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MOL REPORT 2023
Among irreversible changes in the external environment that have an impact on MOL’s business,
those for which the probability of occurrence and degree of impact cannot be quantitatively identified
have been defined as emerging risks.
As management based on past data and expertise alone is believed to be inadequate to deal with
emerging risks, they will be managed with different approaches from business execution risks.
Specifically, for prompt recognition of the opportunities and threats posed by these risks, a
framework for the specification of material risk scenarios and collection of pre-indication information
using the following processes has been introduced.
Overview of Risk Management
Emerging Risks
The Board of Directors will discuss the impact of material risk scenarios that have been identified
on MOL’s business and the possible responses that MOL could take, in line with management’s basic
policy and based on the most recent pre-indication information and expert opinions. Emerging risks
will also be recognized as business opportunities and the Board of Directors and executive officers
will discuss them fully for the formulation of management plans and business strategies.
On the other hand, business execution risks are defined as risks that can be managed significantly
based on past data and expertise and for which concrete risk management systems have already
been developed and implemented by the individual responsible divisions.
Business Execution Risks
For more details on individual business execution risks, please visit our website.
https://www.mol.co.jp/en/ir/management/risk/
Reference: Risk Management Measures to Date
Issue
Policy
Need to establish methods for the management of risks
that were not previously recognized or that, while vaguely
recognized, had no clear policies for dealing with them
Introduction of “emerging risk management”
Need to grasp risks also as opportunities
Recognize emerging risks also as opportunities and
conduct ample discussion by the Board of Directors and
executive officers for the formulation of management’s
basic policies
(1) Information gathering
(2) Risk assessment
(3) Identification of material emerging risks
Using external expertise, list up
scenarios of changes in the external
environment (i.e., risk scenarios),
without limiting them to MOL-related
domains.
When likelihood of a risk scenario
becomes larger, assess the
probability and degree of impact on
MOL’s individual businesses and
value chains.
Identify material emerging risks
while considering the importance
of individual value chains, etc.
Ensure completeness of information
Reflect and extract company perspectives
Fiscal 2014
Fiscal 2017–Fiscal 2018
Fiscal 2018
Fiscal 2019
Fiscal 2021
Introduced Asset
Risk Control
Revised Asset Risk
Control (Increased the
consistency of
investment criteria)
Introduced risk
summary sheets for
deliberations of the
Board of Directors
Promoted the
introduction of a
fuel surcharge in
preparation for
stricter SOx
regulations
Introduced internal
carbon pricing
Established a crisis
response framework
New Risk Categories
Previous Risk Categories
Risk Category
Risk Management
Approach
Major Risks in MOL Businesses
Major Risks in MOL Businesses
(no particular order)
I. Emerging
Risks
Company-wide
management based on
risk scenarios
(1) Geopolitical risks
(2) Climate change risks
Climate change risks
II. Business
Execution
Risks
Management by type
and responsible
division based on past
experience and
expertise
(1) Operational risks
Operational risks
(2) Cybersecurity risks
Cybersecurity risks
(3) Natural disaster and epidemic risks
Natural disaster and epidemic risks
(4) Group governance risks
Compliance risks
(5) Risks related to human rights and
various risks in the value chain
Risks related to human rights and various risks
in the value chain
(6) Shipping market fluctuation, customer
credit, and country risks
Shipping market fluctuation risks, customer credit
risks, and country risks
(7) Exchange rate, interest rate, and bunker
price fluctuation risks
Exchange rate, interest rate, and bunker price
fluctuation risks
In the new corporate management plan, BLUE ACTION 2035, MOL aims to expand its footprint in a
variety of business domains beyond its conventional marine transport business under the slogan
of “Taking the leap to becoming a global social infrastructure company.” At the same time, the
challenges and risk-taking of embarking into new areas can only be achieved if there is appropriate
risk management. With an awareness of the issues shown in the table below, the various risks that
MOL is exposed to have been divided into two categories, “emerging risks” and “business execution
risks,” as way to give added depth to the management of those risks. Through its deliberation on
Corporate Strategy and Vision, the Board of Directors will build a risk management system that
encourages the executive to take risks and will strive to increase the effectiveness of its supervision.
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MOL REPORT 2023
Summary of Financial Data
ROLLING PLAN
BLUE ACTION 2035
2018/3
2019/3
2020/3
2021/3
2022/3
2023/3
For the year
Shipping and other revenues
¥1,652,393
¥1,234,077
¥1,155,404
¥ 991,426
¥1,269,310
¥1,611,984
Shipping and other expenses
1,513,736
1,094,915
1,035,771
911,055
1,117,405
1,376,504
Selling, general and administrative expenses
115,972
101,442
95,852
85,674
96,899
126,770
Operating profit (loss)
22,684
37,718
23,779
(5,303)
55,005
108,709
Ordinary profit
31,473
38,574
55,090
133,604
721,779
811,589
Income (loss) before income taxes and non-controlling interests
(28,709)
46,778
47,130
100,313
732,993
819,160
Profit (loss) attributable to owners of parent
(47,380)
26,875
32,623
90,052
708,819
796,060
Free cash flow ((a) + (b))
(2,471)
(143,093)
(6,527)
44,238
200,187
267,930
Cash flows from operating activities (a)
98,380
55,248
100,723
98,898
307,637
549,925
Cash flows from investing activities (b)
(100,851)
(198,341)
(107,250)
(54,660)
(107,450)
(281,995)
Depreciation and amortization
86,629
90,138
87,765
85,798
86,399
94,660
At year-end
Total assets
¥2,225,096
¥2,134,477
¥2,098,717
¥2,095,559
¥2,686,701
¥3,564,247
Total tangible fixed assets
1,290,929
1,193,910
1,201,698
1,099,458
1,111,152
1,342,240
Total investments and other assets
425,300
524,411
533,320
637,736
1,187,472
1,746,726
Interest-bearing debt
1,118,089
1,105,873
1,096,685
1,026,994
1,000,697
1,153,448
Net assets
628,044
651,607
641,235
699,150
1,334,866
1,937,621
Shareholders’ equity
511,242
525,064
513,335
577,782
1,274,570
1,925,346
Amounts per share of common stock*
Profit (loss) attributable to owners of parent (Yen)
¥ (132.05)
¥
74.91
¥
90.93
¥ 250.99
¥ 1,970.16
¥ 2,204.04
Net assets (Yen)
1,424.94
1,463.46
1,430.77
1,610.04
3,532.32
5,322.35
Cash dividends applicable to the year (Yen)
6.67
15.00
21.67
50.00
400.00
560.00
Management indicators
Gearing ratio (Times)
2.19
2.11
2.14
1.78
0.78
0.60
Net gearing ratio (Times)
1.82
1.88
1.94
1.63
0.71
0.55
Equity ratio (%)
23.0
24.6
24.5
27.6
47.4
54.0
ROA (%)
1.4
1.8
2.6
6.4
30.2
26.0
ROE (%)
(8.7)
5.2
6.3
16.5
76.5
49.8
Dividend payout ratio (%)
—
20.0
23.8
19.9
20.3
25.4
Note: Rounded down to the nearest one million yen
The Company consolidated its common shares on the basis of one (1) share for every ten (10) shares effective October 1, 2017. Also, the Company split its common shares on the basis of three (3) shares for every one (1) share effective April 1, 2022.
Figures have been calculated based on the supposition that said share consolidation and share split were implemented at the beginning of the fiscal year ended March 31, 2018.
(millions of yen)
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MOL REPORT 2023
E
S
G
ENVIRONMENTAL
SOCIAL
GOVERNANCE
Summary of Non-financial Data
GHG Emissions
Number of Employees
(Non-consolidated)
Women
Not from headquarters
In their 40s or younger
1,168
13,330
7.4
5.0
¥55.8
¥76.1
¥206.6
¥650.0
10.32
9.2
15
27
8,748
9
4
4
2
2
6
76
thousand tons
%
%
compared to
FY2019
compared to
FY2019
billion
billion
billion
billion
Down
Down
FY2020
FY2021
FY2022
FY2023-FY2025
Cumulative
g/ton-mile
%
%
%*
[44.4%]
[50%]
[22.2%]
19 100
/
%
Number of
directors
Non-consolidated
Land-based Workers
Percentage of
managerial positions
filled by women
Actual
Target for FY2025→
FY2022 Number of Board of Directors
Meetings
Convened / Attendance Rate
Number of Audit &
Supervisory Board Members
Number of independent officers
(including Audit & Supervisory Board members)
Of which, outside Audit & Supervisory
Board members [percentage]
Number of Employees
(Group*)
Of which, outside
directors [percentage]
Of which, female
directors [percentage]
GHG Emissions Intensity
Environmental Investment
Composition of People Filling MGKP*
Number of Mid-career Hires/
Ratio
*MOL Group Key Positions, designated as equivalent to General Manager of Headquarters, to be appointed
and managed centrally across the Group.
*Percentage of mid-career hires (non-consolidated,
cumulative) among land-based employees
*The parent company and consolidated subsidiaries
(FY2022 Actual)
(FY2022 results)
(as of June 2023)
4.7
18.3
9.5
%
%
%
(Thousand tons)
(FY)
compared
to FY2019
Down
(g/ton-mile)
(FY)
compared
to FY2019
Down
(billions of yen)
FY2023-FY2025
cumulative
billion
(FY)
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MOL REPORT 2023
The MOL Group’s Global Network
History of the MOL Group
Countries and Regions with Group Offices (As of April 30, 2023)
Europe
Middle East / Africa
South Asia / Oceania
East Asia
North America / Central
America / The Caribbean /
South America
Netherlands
United Kingdom
France
Belgium
Italy
Denmark
Germany
Poland
Czech Republic
Russia
Turkey
India
Republic of Mauritius
Qatar
Sultanate of Oman
United Arab Emirates
Kenya
Republic of South Africa
Sri Lanka
Mozambique
Vietnam
Thailand
Malaysia
Indonesia
Singapore
Australia
New Zealand
Philippines
Japan
China
Hong Kong
Republic of Korea
Taiwan
United States of America
Canada
Mexico
Colombia
Brazil
Chile
Panama
Building trust by anticipating customer needs and the demands of the times
1884
Osaka Shosen Kaisha (O.S.K. Line) is established by a union of small- and
medium-sized shipowners in the Kansai region.
1890
O.S.K. Line launches its first overseas route service between Osaka and Busan.
1909
O.S.K. Line launches its first long-distance ocean service between Hong Kong
and Tacoma.
1930
KINAI MARU, a high-speed cargo ship, travels from Yokohama to New York in 25 days,
17 hours, and 30 minutes (advanced ships at the time averaged 35 days back then).
1939
ARGENTINA MARU and BRASIL MARU, two leading cargo-passenger ships in prewar
Japan, ply routes to South America.
1942
Mitsui & Co., Ltd. spins off its shipping department to create Mitsui Steamship Co., Ltd.
(Mitsui Line).
1964
Industry restructuring through consolidation of marine transport companies.
O.S.K Line and Mitsui Line merge to form Mitsui O.S.K. Lines, Ltd.
1965
MOL launches Japan’s first specialized car carrier, the OPPAMA MARU.
1968
Service of full containership the AMERICA MARU begins.
1993
Crew training school is established in the Philippines.
1999
New Mitsui O.S.K. Lines is established through the merger of MOL and Navix Line.
2004
DAIBIRU CORPORATION becomes a consolidated subsidiary of MOL.
2010
First participation in FPSO project
2020
MOL’s first LNG bunkering vessel is delivered.
2017
Becomes the first company to own an FSRU in Asia
2022
DAIBIRU CORPORATION and Utoc Corporation become wholly owned subsidiaries of MOL.
1995
World’s first marine transport alliance called The Global Alliance (TGA) is formed with
two overseas shipping companies.
2018
Container shipping joint venture of three Japanese companies, Ocean Network Express
Pte. Ltd. (ONE), starts business operations.
Establishment of maritime academy in the Philippines
Accomplishing the Company’s first natural gas transportation in the Arctic Ocean
eastward route using an ice-breaking LNG carrier
Europe
Middle East / Africa
South Asia / Oceania
East Asia
Japan
America
25
24
51
24
44
16
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MOL REPORT 2023
Information Disclosure and External Recognition
Given that it is stated in the MOL Group Three Basic Principles of Corporate Governance
that we shall engage in a highly transparent dialogue with all our stakeholders, we consider
engagement with investors, shareholders, and other stakeholders to be an important management
task.
In IR activities conducted by the president and CFO, rather than simply responding to questions in
a way that does not allow any comeback or in a way that is superficial in the content of the responses,
we offer a forum in which mutual understanding with shareholders is pursued through the setting of
creative agendas and allowing for longer meetings for freer discussions to take place. Further, fully
appreciating the importance of fair disclosure, we disclose financial highlights, business performance
briefing materials, integrated reports, and other core IR tools in both Japanese and English.
Moreover, in fiscal 2021, we began providing online videos of financial results briefings for analysts
and institutional investors.
In addition to the dissemination of information, we place particular emphasis on the inhouse
feedback of opinions obtained through dialogue with stakeholders. Feedback obtained from meetings
with investors is compiled and reported regularly to the Board of Directors and the Executive
Committee. When more-specific opinions on management plans and the Sustainability Issues are
received, the Corporate Communication Division, which is in charge of IR, directly communicates the
feedback to the relevant divisions and encourages them to incorporate and reflect it not only in the
enhancement of disclosure but also in the implementation of measures.
In fact, MOL has implemented an array of initiatives to show the positioning of management
goals and improve governance, including the formulation of a new Group corporate management
plan, updating MOL Group Environmental Vision 2.1 to 2.2, hosting dialogue sessions between
outside directors and shareholders, and the formulation of a corporate governance policy. We are
also moving forward with many different industry-leading measures in pursuit of a low-carbon and
decarbonized society, including the building
of vessels equipped with Wind Challenger
hard sail systems and various types of LNG-
fueled vessels as well as planning a variety of
recommendations and initiatives through our
participation in the World Economic Forum.
The aforementioned initiatives are by no means
solely the result of our aspirations but rather
reflect the opinions of investors, shareholders,
and a range of other stakeholders.
Through continued in-depth communication
with our stakeholders, we will elevate our
corporate value even further.
Promoting Information Disclosure and Engagement
MOL Group Corporate Management Plan
BLUE ACTION 2035
Formulation of MOL Group Environmental Vision 2.2,
MOL Group Human Capital Vision,
and MOL Group DX Vision
Formulation of the Corporate Governance Policy
Hosting of dialogue sessions with outside directors
Raising of the dividend payout ratio and introduction
of a minimum dividend
Policies and Measures That Reflect External Feedback
Activity
Frequency
Details
For securities
analysts and
institutional
investors
Financial results briefings
4 times
Quarterly results / forecasts
Small meetings with the CEO
5 times
Two held each in spring and autumn, once for
responsible investment managers
For overseas
institutional
investors
Overseas investor road shows
4 times
Held visits (twice in Europe and twice in Asia)
Conference held by securities
companies
8 times
Participation in online and in-person conference
For individual
investors
Corporate presentations for
individual investors
Once
Participation in online events for individual
investors
Material
Japanese
English
Stock exchange filings
(financial highlights, etc.)
Business performance briefing
materials (including summaries of
Q&A sessions)
Business performance results
briefing video
Integrated report
Securities reports (“Yuho”)
—*1
Material
Japanese
English
Quarterly reports
—
Business reports for shareholders
—*2
Investor guidebook
Market data
IR Activities in Fiscal 2022
IR Materials (available on MOL’s website)
*1 Abridged version posted as Financial Statements
*2 Posted as Business Report
THE INCLUSION OF Mitsui O.S.K. Lines, Ltd. IN ANY MSCI INDEX, AND THE USE
OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO
NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT OR PROMOTION OF Mitsui
O.S.K. Lines, Ltd. BY MSCI OR ANY OF ITS AFFILIATES. THE MSCI INDEXES ARE THE
EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEX NAMES AND LOGOS
ARE TRADEMARKS OR SERVICE MARKS OF MSCI OR ITS AFFILIATES.
External Recognition
P43
04 Corporate Information
01 Value Creation Story
02 BLUE ACTION 2035
03 Corporate Governance
Contents/Editorial Policy
55
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Glossary (In alphabetical order)
ICP (Internal Carbon Pricing)
ICP is a system that sets a fixed in-house price for GHG emissions.
The system enables the quantification of GHG emission reductions
as positive economic impacts. Therefore, it promotes low-carbon
investments that would otherwise generally be viewed as cost-
increasing factors. Consequently ICP is working to mitigate possible
economic impact brought by carbon tax and other future charges on
GHG emissions.
Wind Challenger
The Wind Challenger is a telescoping hard sail that converts wind
energy to propulsive force. Installation of Wind Challenger sail on
merchant ships can help reduce the vessel’s environmental load and
improve its economic efficiency by helping reduce the amount of fuel
required for sailing.
Clean Ammonia; Clean Methanol
This is ammonia and methanol produced using technologies that
do not emit GHG. Clean ammonia and clean methanol are broadly
classified into two types: blue and green. Blue ammonia and blue
methanol are produced from fossil fuels, but the CO2 generated is
captured and stored. Green ammonia and green methanol are derived
from renewable energy sources. The use of clean ammonia and clean
methanol technologies in combination with ammonia-fueled vessels
and methanol-fueled vessels, which are currently under development,
promises to advance low-carbon marine transport.
Chemical Tankers
Tankers fitted with multiple tanks to transport many different types of
liquid chemical cargo at the same time. These tankers have complex
design specifications, as they are equipped with independent pipelines,
cargo pumps, and temperature-regulating functions for each tank, in
addition to dedicated facilities for cleaning and other features.
Synthetic Methane/Methanation
This is methane produced from CO2 and hydrogen. Like natural gas,
synthetic methane can be used as a marine fuel. Methanation is the
process used to produce synthetic methane. By using CO2 from the
atmosphere and hydrogen derived from renewable energy sources as
raw materials, CO2 can be cyclically used. This process can significantly
lower GHG emissions, which contribute to global warming.
Subsea Support Vessels
Vessels designed for installation and maintenance of subsea facilities
during production and exploitation of offshore oil and gas fields.
Market Exposure
Market exposure is when a company takes the risk of shipping market
fluctuations due to a mismatch of ship procurement and operation,
when spot contracts or short-term cargo contracts are allocated to
ships (both owned vessels and chartered vessels) procured on the
assumption they will be used over the medium or long term. MOL
defines market exposure ships as medium- to long-term procured
ships without contracts lasting more than two years. While monitoring
the ratio of market exposure ships, management properly controls the
total shipping market fluctuation risks.
Small- and Medium-Sized Bulkers
Panamax, Handymax, and Handysize dry bulkers that mainly transport
general bulk cargo, such as coal, grain, salt, cement, and steel
products.
CTV (Crew Transfer Vessel)
CTVs operate from a base port to bring maintenance engineers to
offshore wind farms that are relatively close to shore.
FPSO (Floating Production, Storage and Offloading System)
An FPSO is a floating facility that produces, stores and offloads oil and
gas. Crude oil produced and stored offshore is directly loaded into
shuttle tankers for transport.
FSRU (Floating Storage and Re-gasification Unit)
FSU (Floating Storage Unit)
An FSU is a floating facility for storing LNG offshore. An FSRU has the
same structure as an FSU with an additional function for regasification
of LNG onboard, with which it can send out vaporized natural gas to
land through a pipeline. FSRUs and FSUs are being adopted for a
growing number of projects to establish LNG receiving terminals all
over the world because of their advantages, including a shorter lead
time and lower costs compared to conventional onshore receiving
terminals.
LNG Carriers
Tankers designed for the transportation of liquefied natural gas (LNG).
To transport LNG which has been cooled to –162°C, LNG carriers make
use of a wide variety of technologies in various ship parts, including
specialized tanks that can withstand extremely cold temperatures and
emergency shut-off devices to prevent accidents in cargo operation.
NOx
Nitrogen oxide (NOx) is a cause of atmospheric pollution, and it is
created when nitrogen combines with oxygen in the air under high
temperatures, like when fuel is combusted inside engines. NOx
emissions from ships are regulated by IMO rules, and the third set of
NOx regulations went into effect in 2016.
RoRo (Roll-on/Roll-off) Ships
These ships have rampways that allow vehicles to be driven on and
off the ship. They can also transport trucks and trailers loaded with
cargo. Some ships equipped with RoRo systems are pure car carriers,
which mainly transport vehicles that are not loaded with cargo and
construction machines. Other RoRo ships are ferries that transport
cargo vehicles, passengers, and privately owned vehicles.
04 Corporate Information
01 Value Creation Story
02 BLUE ACTION 2035
03 Corporate Governance
Contents/Editorial Policy
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MOL REPORT 2023
Shareholder Information
Capital
¥65,589,827,533
Head Office
1-1, Toranomon 2-chome, Minato-ku, Tokyo 105-8688, Japan
Number of MOL employees
1,168
Number of MOL Group employees
(The parent company and consolidated
subsidiaries)
8,748
Total number of shares authorized
946,200,000
Number of shares issued
362,010,900
Number of shareholders
384,381
Shares listed on
Tokyo Stock Exchange – Prime Market
Share transfer agent
(Contact information)
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Trust Bank, Limited, Stock Transfer Agency
Business Planning Department
8-4, Izumi 2-chome, Suginami-ku, Tokyo 168-0063, Japan
Communication materials
MOL Report
https://www.mol.co.jp/en/ir/data/annual/
Investor Guidebook
https://www.mol.co.jp/en/ir/data/ig/
Market Data
https://www.mol.co.jp/en/ir/data/market/
Website
https://www.mol.co.jp/en/bam/
YouTube Official Channel
https://www.youtube.com/@molofficialchannelenglish9003
(as of March 31, 2023)
Self-Elevating Platform
Special vessels that extend four legs to the seabed to enable installation
work for wind power generation equipment in stable conditions.
SOV (Service Operation Vessel)
SOVs have extensive accommodation for maintenance technicians
working on multiple wind turbines that make up an offshore wind farm,
allowing technicians to stay on-site for extended periods.
SOx
SOx encompasses sulfur dioxide (SO2) and other sulfur oxides, which
are substances that pollute the atmosphere when oil, coal, and other
fossil fuels that contain sulfur is incinerated. In the shipping industry,
SOx emissions in the exhaust gas of ships are regulated, and in January
2020, regulations were tightened, greatly reducing the allowable sulfur
content in bunker fuel from 3.5% to less than 0.5% (general sea areas).
TCFD (Task Force on Climate-related Financial Disclosures)
A disclosure framework specializing in climate-related information. It
encourages companies to disclose the financial impact climate change
has on their business.
04 Corporate Information
01 Value Creation Story
02 BLUE ACTION 2035
03 Corporate Governance
Contents/Editorial Policy
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