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Human Resources Management

Talent Management

Human Resource Strategy

The Mitsui Chemicals Group has been devising and implementing human resource strategies based on long-term business plans, and various HR/organizational strategies to address identified priority issues, steadily spearheading the reformation of the business portfolio on global Group-wide levels and expanding businesses across the globe in terms of HR management. As a result, since Mitsui Chemicals was established in 1997, the Group has grown to 165 consolidated subsidiaries and 18,933 employees (as of the last day of March 2023, excluding contract employees). Furthermore, the overseas sales revenue ratio has expanded to 49%.

In order to implement VISION 2030, we have also identified (1) acquisition, development, and retention of human resources, (2) improvement of employee engagement, and (3) strengthening of group and global HR governance and proactive disclosure of human capital value as the ideal state of our HR strategy, in view of changes in the external environment, and have defined the priorities and measures that must be implemented.

Priority Issues and Measures in Human Resources Strategy

Our Ideal State in 2030

Being able to acquire, develop, and retain talents who can create businesses linked to social issues by collaborating with customers and partners.

Human resources who can work with customers and partners to create businesses that address social challenges are being acquired, developed, and retained.

Priority issues and measures for our human resource strategy

● Strategic recruiting, development, and retention of future executives with diverse backgrounds

Key talent management
Advancing job-based HR management

● Design of human resources portfolio aligned with the ideal business portfolio

DX personnel development

Being able to transform to a corporate culture that has transformed its improved employee engagement into organizational power.

Transformation to a corporate culture that increases the engagement of human resources and converts it into organizational strength has been achieved.

● Embodiment of self-initiative, autonomy, and collaboration

New work-style that achieves the “best mix”
Continuous action for greater engagement
Compensation & Benefit system to develop a culture that embraces making challenges

Being able to organize our Group's HR governance and communicate our human capital value internally and externally.

Human resources governance has been established, and the value of Group human capital is being communicated both internally and externally.

● Upgrading of human resources governance to accommodate for mergers and acquisitions (M&As), etc.

Competitive compensation design

● Creation of an integrated Group-wide human resources platform

Promoting analytics

In order to promptly formulate and implement various HR measures for these "measures to be implemented" at a Group and global level, the Global Human Resources Division will play a central role in the CoC functions of Talent Management, Talent Development, Total Rewards, the HRIS (Human Resources Information System) & People Analytics, etc., thereby strengthening the regional HR functions including Japan.

Key Talent Management and Critical Position Successor Planning

The Mitsui Chemicals Group defines "Key Talent" as candidates for critical positions in the company, including future executive who will lead the next generation in pursuit of business portfolio transformation from the social issue perspective, as well as people who can simultaneously conceive new ideas and bring about change by building solutions-based business models through global expansion, M&A, and other means. Key Talent Management is a core initiative of Mitsui Chemicals' human resource management, which has established a culture within the organization of discussing each candidate's career, personal interests and aspirations, and development plan. The system has been operating since fiscal 2016 as a common system for the Group and globally.

Key Talent Management System

Our corporate governance guidelines place "Key Talent Management" at the center of the system for succession planning, which covers senior management (such as sector presidents and CxOs). After clarifying the qualities necessary for management, we conduct early selection and strategic training of candidates for senior management positions. Every year, all members of senior management, including the president, CxOs, sector presidents, and general managers of each business division and office, participate in Divisional and Corporate Key Talent Management Committees as consultative members, select candidates from the Group and global management who will lead the next generation, formulate development plans for each candidate, and spend time discussing their contents. Based on the contents of these assessments, we conduct assessments and create development opportunities and assignments, etc., to help each individual develop their careers. In particular, with a view to achieving VISION 2030 in FY2022, we have redefined the human resource requirements and necessary qualities required for the executive management level. Significant efforts are also underway to select more suitable personnel and develop more effective training plans. We have also set as non-financial KPIs in VISION 2030 the ratio of diversified executive officers (at least three women and at least ten non-Japanese and mid-career recruits), and are working to enhance the diversity of our management team executive candidates.

Successor selection and development for critical positions

Strategically critical positions for implementing each strategy (mainly general managers and higher, and presidents of major affiliates) and positions for which assignment should be promoted (to train next-generation management candidates) are being identified and approved by the Corporate Key Talent Management Committee, and successors are being planned for such positions. The committee also creates career development plans for these positions. We have identified some 100 strategically critical positions and development positions across the world, and are actively acquiring suitable human resources from inside and outside the Group to fit them.
The progress of key talent management and succession planning for strategically critical positions is periodically reported to the Board of Directors. Doing so enables the Board to periodically and objectively monitor the progress of talent pipeline development. We are also proactive in making suggestions from the aspect of strengthening the pool of human resources who will be considered by the Director Nomination Committee, thus creating a framework with strong capabilities for the whole Group.

Key Talent Management Processes

Key Talent Management Assessment System

*1 The proportion of group employees who are future sector president candidates for Mitsui Chemicals, Inc. headquarters

*2 The proportion of group employees who are future general manager candidates for Mitsui Chemicals, Inc. headquarters

Qualification and experience required for management candidates

Two HR requirements for management candidates:

Must possess knowledge and experience to manage the business accurately and fairly towards achievement of the business vision.
Must possess keen insight, a wide view, ethics, fairness, and honesty.

Experience required of a management executive

Five axes	Description
(1) Management perspective	PL in multiple business divisions (business responsibility in different areas) Management of subsidiaries, etc.
(2) Business restructuring	Restructuring of at-risk businesses
(3) New business development	Planning and execution of new business models Novel business creation (market, products, or customers) etc.
(4) Company-wide projects	Staff management in relation to company-wide issues Creating long-term plans Major M&A and alliance management, etc.
(5) International experience	Managing overseas companies

Progress and Future Prospects

FY2022 progress
Redefine the HR requirements for future management (CxOs) (associated with VISION 2030) Clarify the competencies, skills, experience, and credentials required for each management position to elaborate the succession planning and the selection process of candidates for strategically critical positions. Hold an action plan meeting to follow up and ensure implementation of the key talent development plans. Start to monitor the diversification of key talents and evaluate diversity-promoting measures, with considerations given to non-financial metric for VISION 2030 and the number of diverse executive officers (women, non-Japanese, and mid-career recruitment). Continuously watch the successor coverage rate, which shows how full the successor pool is, along with the successors’ age and the number of overlapping nominees, to confirm the effect of developing the talent pool.
Plans for FY2023
Further enhance assessments for future executives to optimize training and succession planning. Promote external recruitment and improve training plans for existing employees in order to diversify the pool of management candidates.

Successor coverage rate/number of diverse executive officers

The successor coverage rate^* shows the percentage of secured successor candidates versus the number of strategically critical positions to achieving company-wide strategies. The rate is regularly monitored. Today, many companies are working on succession plans and succession planning in order to avoid the risks associated with the absence of successors. We have established the successor coverage rate as a non-financial metric in VISION 2030, and publish it externally so that we can quantitatively grasp its status and ensure its effectiveness. We have also set the number of diversified executive officers as a non-financial metric (executive officers in 2030: at least three women and at least ten non-Japanese and mid-career recruits), not only to ensure continuous and stable development of successors, but also to manage the effectiveness of key talent management from the perspective of diversity. In April 2022, women, non-Japanese, and mid-career recruits were added to the executive board.
Going forward, we will continue to work on talent management, accelerating it with business measures that meet the needs of society and the times.

*Successor Coverage Rate:
The number of successor candidates for strategically critical positions / The number of strategically critical positions.