MHI to Introduce New Chief Officer System and Partially Reorganize its Corporate Departments
Tokyo, March 13, 2014 - In conjunction with its completion of the transition to a domain-based business structure, effective April 1 Mitsubishi Heavy Industries, Ltd. (MHI) will newly introduce a system of chief officers. The chief officers will be delegated a portion of authority and responsibilities currently held by the president, and will have authority to give instructions and commands matters relating to specified business areas on a companywide basis. The aims in adopting the new system of chief officers are to further strengthen corporate governance and to boost and increase the efficiency of business support to business domains. In tandem with the introduction of the new system, MHI will, effective the same date, also undertake partial reorganization of its corporate departments in a quest to maximize the system's functioning.
Under the new chief officer system, in addition to the chief executive officer (CEO: President and CEO) and Domain CEOs (President and CEO for each of four Domains), three chief officer posts will be established: the Chief Administrative Officer/Chief Risk Officer (CAO/CRO), Chief Financial Officer (CFO) and Chief Technology Officer (CTO). The CAO/CRO will oversee management auditing, general affairs, legal affairs, human resources and labor relations; the CFO will be responsible for finance and procurement; and the CTO will take charge of technology and innovation, as well as information and communication technology (ICT). The three chief officers will also be delegated a portion of authority and responsibilities currently held by the president, oversee specific matters companywide, and undertake support to the Domains.
Under partial reorganization of the corporate departments, the current Presidential Administration Office will be abolished and a new "Business Strategy Office" will be established under direct management by the president. The new office will aim to strengthen strategy planning and promotion capabilities. The structural changes of corporate departments will also include reorganization and strengthening of current Accounting Division and Finance Department, and shift of procurement functions relating to each business area to their respective Domains. Corporate organizational names will also be changed as may be deemed necessary.
The introduction of the new chief officer system and partial reorganization of the corporate sector are initiatives targeting further progress in carrying out the corporate reforms implemented in April 2013 in a quest to make corporate functions more advanced and efficient; those reforms were an extension of the earlier series of structural reforms undertaken subsequent to measures implemented in April 2011 to strengthen companywide business operation structures. With the new system and partial reorganization, MHI will forge a structure able to perform strategic cross-divisional functions pertaining to highly specialized business matters, affairs affecting the entire company, and affairs requiring the company to exercise appropriate restraint. Liaison will also be pursued with the Domains, and business management based on efficient companywide governance will be promoted.
Going forward MHI will continue to strengthen its vertically oriented (business) functions as well as its horizontally oriented functions (companywide strategy and business support functions), while also enhancing its ability to respond to risk, in its quest to come out a winner in the global markets and make the leap to a highly profitable corporation with a business scale of 5 trillion yen.