President and CEO’s New Year’s Message for 2025

Below is the “New Year’s Message for 2025” delivered this morning by President and CEO Katsuya Nakanishi at Mitsubishi Corporation’s headquarters in Marunouchi, Tokyo.

As we begin 2025, I would like to share my New Year’s message with all of you.

This year, the New Year’s holiday in Japan was longer than usual. I hope everyone had a chance to recharge and start the first workday of the year with fresh hopes and aspirations. I was also able to spend some time relaxing and unwinding. It brings me great joy to start this new year alongside all of you.

Accelerating Pace of Change
In my New Year’s address last year, I remarked that 2024 was likely to be a "year of change," marked by heightened uncertainty from geopolitical risks, as reflected by elections in over 70 countries, and accelerating disruption driven by technological advancements. Thinking back on the past year, I imagine many of you felt that changes unfolded across many areas at an even faster pace than expected.

For example, nearly three years have passed since the Russia-Ukraine conflict began. While Western nations have imposed sanctions, some countries have criticized Russia’s actions but refrained from joining the sanctions. Furthermore, these Western-imposed sanctions are causing both political and economic damage within their own borders, further deepening the complexity of the situation.

In the economic sphere, while demand has recovered in the post-COVID world, a combination of factors, including instability in energy and food supplies caused by conflicts, has driven a sharp rise in inflation and a global increase in interest rates. This has, in turn, increased volatility in currency exchange rates. At the same time, intensifying US-China trade tensions are expanding geographically and drawing more countries into trade disputes. As a result, this shift from globalization toward protectionist and nationalist trade policies is likely to lead to further changes in supply chains in the future.

Meanwhile, in China, one ofthe world's largest markets, domestic demand has declined more than expected due to a real estate downturn and other factors. In response, China is increasingly looking to external demand to drive economic growth and is actively expanding into overseas markets beyond the US, its largest export destination. These developments are having significant ramifications, including on our business operations, which rely on Asia as a major source of earnings.

With regard to technological innovation, AI is evolving at a pace that exceeds expectations, driving transformative changes in society and the economy. Notably, startups and other new businesses are harnessing AI to develop innovative business models that break free from conventional thinking, accelerating the disruption of established industries by players from other sectors.

Turning to Japan, global perceptions of the Japanese market are shifting. While the price-to-book ratio (PBR) of Japanese companies is trending upward, the weak yen has heightened the perception of undervaluation, leading to an increase in acquisitions byoverseas funds. We are even seeing significant acquisition proposals targeting prominent Japanese companies.

Given the complexity of the current situation, I believe it is more important than ever to enhance our corporate value through proactive measures, leveraging the intelligence from our global network and staying a half step or even one step ahead.

Turning Change into Opportunities
As we enter 2025, President Trump is beginning his second term in the US. While the policies he will introduce remain uncertain, one thing is clear: changes originating in the US are likely to accelerate and amplify global transformations. We must be ready to meet these changes with determination. Adaptability and flexibility – these qualities are now more essential than ever.

In these times of change, I believe the importance of creating MC Shared Value (MCSV), as laid out in Midterm Corporate Strategy 2024, is steadily increasing. As changes spanning industries continue to unfold, MC, with its broad involvement across diverse sectors, holds abundant possibilities for turning changes into opportunities.

Allow me to share an example. Last year, I had the opportunity to take a ride in a cutting-edge autonomous vehicle. It was a firsthand encounter with how autonomous driving software transcends hardware, redefining the concept of an automobile and embodying the idea of a software-defined vehicle (SDV).

The structure of the automotive industry is undergoing significant change, with key differentiators shifting from engine technologies – long the specialty of automakers – to AI and software. In response to these structural shifts, MC has the potential to transform these changes into opportunities, not only by focusing on mobility, but also through diverse approaches involving energy, materials, semiconductors, battery resources, and AI use cases.

Another example is sustainable aviation fuel (SAF), which is increasingly viewed as a promising clean energy source. MC has the ability to explore monetization opportunities not only within the energy sector but also across multiple points in the value chain, such as raw materials like soybeans, which serve as essential inputs.

In other words, thanks to our diverse portfolio spanning numerous industries and our deep engagement in business operations, we can share real-time information across the organization, allowing us to foresee future trends from multiple angles. This is a unique strength of ours. I am confident that bolstering our “collective capabilities” to create greater shared value, or MCSV, will provide us with a decisive competitive advantage.

However, our strengths can only be fully harnessed by staying attuned to changes, drawing connections, and uniting our efforts to transform them into business opportunities. Simply focusing on the present will cause us to miss these changes.

By always keeping our eyes on the future and leveraging our collective capabilities, we can overcome change and achieve robust growth. I am deeply committed to working with all of you to make our company one that embodies this vision.

Our Core Values 
This fiscal year marks the final year of Midterm Corporate Strategy 2024. Thanks to your efforts, we achieved earnings in the vicinity of 1 trillion yen in both FY2022 and FY2023.This has surely brought a sense of accomplishment, but we must also ask ourselves whether we are at risk of slipping into complacency.

Surrounding us are numerous hidden “pitfalls,” including those related to laws and regulations, as well as geopolitical and country-specific risks. We will continue to enhance our corporate risk management framework, but the most critical factor remains the passion and on-the-ground focus of each individual employee. This entails visiting the front lines, understanding our customers and partners, and developing a deep understanding of industries, countries, and risks. Regardless of how society and the operating environment evolve or how the nature of our business changes, these are the fundamental practices we must steadfastly uphold as MC professionals.

It is my sincere hope that all of you will remain humble, stay grounded, and always approach everything with passion and ambition.

On the front lines of business, we stay attuned to even the slightest changes and actively transform opportunities into new businesses. It is the passion and drive of each employee that enables us to uncover the seeds of growth and nurture them into budding ventures, shaping the future of MC. Let us all renew our determination and continue to approach our daily work with this mindset.

A Year of Forward Momentum
Finally, 2025 is the Year of the Snake according to the Chinese zodiac. The snake, which grows by repeatedly shedding its skin, symbolizes “advancing to new stages of development through continuous transformation.” This makes it a particularly fitting year to embark on a new management strategy.

We have refreshed our advertising for the new year with the message "The Spirit of Adventure." The goal is to showcase, both internally and externally, a renewed image of MC, driven by the passion within each employee. Rather than fearing waves of change, we embrace them as opportunities for challenge and growth, pushing forward to create new value. Let’s make this a year filled with energy and forward momentum.

As we prepare to bring Midterm Corporate Strategy 2024 to a successful close, we are also gearing up for a strong start to our next management strategy. Today marks the beginning of this journey for all of us. Let us unite as one to chart a bright future for MC.

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