Investing in Japan
Dow Chemical Japan Limited
Industry： Other Manufacturing
*The interview is a translation of the original Japanese article and is not a direct quote from the interviewee.
Dow Chemical, one of the largest, integrated technology-based products and solutions provider based in the U.S , has a very diverse business portfolio; not only manufacturing, importing and sales of various chemical products, but also research and development and providing technical solutions. We interviewed Mr. Peter M. Jennings, President of Dow Chemical Japan Limited, regarding the company’s business situation in Japan and future outlook.
Dow Chemical is one of the world’s largest integrated chemical product suppliers, employing approximately 53,000 people worldwide, providing products and solutions in 180 countries. It also has a long history in Japan. Dow Chemical established a joint venture company with a Japanese partner company and launched full-scale operations in 1952. In 1974, Dow established Dow Chemical Japan Limited. Ever since then, they have broadened their business portfolio, including manufacturing, importing and sales of various chemical products, technical services, and related research and development. We interviewed Mr. Peter M. Jennings, President of Dow Chemical Japan Limited, regarding the company’s operations in Japan and future prospects.
History of the company from entering Japan to today
The history of our business with Japan is extensive, and this is the 62nd year. We have aimed to be the “most reliable and best supplier of materials and chemical products” in Japan. We have a distinguished history, as seen in the example of being the very first foreign company to be listed on the Tokyo Stock Exchange in 1973.
Dow’s business model has greatly changed since the establishment of our Japan base. While we used to be a manufacturer who handled commodity products, such as basic plastics and chemicals, until about 10 years ago, we have now changed into an innovation-driven company based on science and technology. We have been promoting efforts with the aim of realizing a truly sustainable world by providing solutions to various global issues, such as water resources, renewable energy and improvement of crop productivity.
Our size is one of our strengths. Dow is a global company with approximately 53,000 employees worldwide. We have strong research and development teams throughout the world and make proactive investment into this area. Last year, the company invested $1.7 billion in research and development.
Another strength of Dow is that we have a very large portfolio of products rather than depending on one product. Since the conventional business model mainly focused on commodity-based products, we used to be significantly impacted by the raw materials price fluctuations. Today, our product portfolio covers a wide variety of categories, including innovative plastic materials, electronic materials, water process technologies and building and construction materials. This shift has reduced the impact of said price fluctuations.
Attraction and potential of Japanese market
After the war, Japan achieved remarkable growth and became a world economic leader. Japan has a vast pool of talented human resources and a society that is built based on innovation. I think that Japan’s automobile industry, which now leads the world through continuous “kaizen” activities, is proof of this.
For Japan to capture investments and the new growth and to maintain and improve competitiveness toward the future, the industry, government and academia must work together to keep driving innovation. I believe that, depending on how they promote efforts in the future, Japan will become an attractive investment candidate for many foreign companies and we also hope to be able to participate in that investments.
Research and development in Japan
The only way to remain competitive in today’s global market is by continuous innovation. The “Dow Japan Development Center” (Yokohama) has highly motivated researchers dedicated to making the new innovation on a continuous basis. The highly skilled staff at this center possesses rich experiences, and it is no exaggeration to say that they are the key to our further success in the Japanese market.
The requirement standards of the Japanese customers are, without a doubt, the highest in the world. To create new products and technologies to respond to their needs, investment in innovation in and for Japan is a necessity. There are currently 35 technical-oriented personnel at the center, and we hope to expand the capabilities in the future.
Business promotion in Japan and relationship with local areas
We focus on contributing to local communities where we conduct business. This is reflected in the fact that we have included “contributing to community success” as one of the principles in our company’s “2015 Sustainability Goals”. We have been promoting contribution projects in various locations in Japan where we have plants for many years.
One example of these efforts is the case of Soma City in Fukushiima Prefecture. The Soma plant, which celebrated its 20th anniversary of operation in 2013, manufactures special ion exchange resins for water treatment in the industries of semiconductors, power plants and electronic materials. We have established a long term friendly relationships with the city of Soma and local residents by donating solar-powered LED street lights, in line with the “2015 Sustainability Goals”. When the Great East Japan Earthquake occurred in March of 2011, the Soma plant was also greatly damaged by the tsunami. While working to swiftly recover our plant, we also donated 2 million U.S. dollars to the city of Soma as disaster relief. We also built the “Dow Soma Nagaya” (Soma City, Fukushima), an apartment complex for the elderly victims of the Tohoku earthquake and tsunami in March 2011, and donated it to the city with the aim of preventing solitary death of elderly who were forced to live as evacuees.
We announced the “2025 Sustainability Goals” in April of this year. We will continue making proactive efforts as a global company toward the establishment of a sustainable society.
Future development in Japan
We will continue investing in Japan. In order to achieve sustainable growth in the country, we must ensure the best talents and keep challenging. We will continue to aim high to be the manufacturer of the best quality products in Japan, be the best place to work, be the better solution provider and become the best chemical company. Through these efforts we will retain our position as the leader in the industry.
(April 2015 Interview)
|1897||Established as a manufacturing company for bleach and potassium bromide in Michigan, US|
|1952||Asahi-Dow Co. Ltd., a joint venture company with Asahi Chemical Industry Company, established|
|1973||Dow Chemical Company becomes first foreign company to be listed on Tokyo Stock Exchange|
|1974||Dow Chemical Japan Limited established|
|2007||Dow Japan Development Center established in Kawasaki|
|2014||Dow Japan Development Center transferred to Yokohama|
|Business||Manufacturing/importing/sales of various chemical products, technical services and related research and development|
|Parent company||Dow AgroSciences B.V.|
|Address||(Head office) Tennoz Central Tower, 2-24, Higashi Shinagawa, 2-chome, Shinagawa-ku, Tokyo|