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MGC and the vital role of chemical companies

Interview - September 18, 2020

The Mitsubishi Gas Chemical Group specializes in developing chemical products ranging from basic chemicals to fine chemicals and performance materials. We seek to be an outstanding chemical company with original technologies and a strong presence in society by using our specialization to create value supporting both the sustained growth of our business and the realization of a prosperous society. The Group's fundamental mission and our raison d'être is to use chemistry to "create value to share with society." For our business to succeed, we must offer technologies and products that provide value by accurately meeting the needs of society. This, in turn, requires that we identify the needs that society has today as well as the needs it will have tomorrow.



How MGC is contributing to society 5.0? How is the Japanese Monozukuri culture allowing Japan to be a global influence?

To illustrate this point I will utilize the example of the current situation Japan is undergoing due to COVID-19. An acceleration speed towards digitalization is taking place; the end purpose is to implement this digitalization in all sectors, especially in the research field. The next 3 years will be crucial for turning Japan into the core of smart factories and laboratories.

The entire chemical fields at both the national and international levels are required to cooperate to avoid inconsistencies and obtain the optimum results for the international community. The creation of a big data bank would be key to sharing data freely, not only inside Japan but also between countries such as China and the US.

There are 18.000 chemical companies in Japan, with a total amount of 920.000 people working in them. This advanced society that everyone longs for will only be attained with the support of large companies (e.g. Panasonic, Toyota…) working in synergy.

All things considered, we support this evolution through the provision of materials such as providing polymers and resins which are fully used in autonomous driving and fuel batteries (which are still a challenge for Tesla).


The chemical industry is booming. What is the role of chemicals in our daily lives?

Innovative trends such as SpaceX exist thanks to chemical companies, from the raw materials to the machinery; they are all utilizing the polymers and resins. The carbon fiber manufactured by Toray is enabling the world to sail from one place to another; we have various polymers and resins which are able to manufacture the carbon-fiber composites of excellent heat-resistance. When looking at the elements required to tackle global issues it comes down to the role that chemicals can play.


Which are the key milestones of your company?

In the beginning, Mitsubishi Edogawa Chemical (a market-driven chemical company with over 100 years of history) and Japan Gas Chemical (driven by natural gas chemicals) merged in 1971. The company has continued to put value in both elements; chemicals market-driven and chemicals derived from natural gas. 

We have around 500 researchers and invested around 5% of our total revenue (not consolidated) into R&D at the moment. We have three research laboratories located in Niigata Prefecture, Kanagawa Prefecture, and Tokyo. What is more, each one of them caters to a unique specialty, e.g. organic chemicals, catalysts, biotechnologies and polymers derived from natural gas chemicals, market-driven performance chemicals. In the immediate future, we want to raise the percentage and allocate 10% of our revenue and be known as a company that prioritizes R&D.


Is research always done internally or do you search for co-creation partners?

Up until now, R&D was mainly done in-house but in the immediate future, we want to undertake the task of creation with partners to unify efforts. We have close ties with several partners worldwide. Forty years ago we were pioneers in the Saudi Arabian chemical industry (e.g. methanol), we acknowledged the risk of building a factory to produce methanol jointly when there were no factories insight.

We protect and highly value the bonds we have forged to date. As a result, we have a rich history of common ventures in many countries worldwide which we hope will continue to grow. It is part of our company’s corporate philosophy to value courage towards challenges and perseverance to achieve our goals. For instance, I had just been employed when the Saudi Arabia project took off and I saw the importance of being proactive.

In brief, around 50% of our total revenue (consolidated) comes from our overseas companies, as future ventures, we want to open two companies, one in Europe and another one in North America where we already have 4 factories. Every Japanese business must be willing to take risks and expand outside the walls of Japan; otherwise, the development will be limited. In our group we have near 10,000 employees worldwide, in terms of our total revenue, it is about 650 billion yen. Within 10 years we want to reach 1 trillion yen mark.


Where are your core technologies enabling MGC to develop this globally friendly energy source?

Needless to say energy is our "go-to" domain, as it does not seem to stop rising. For the past 40 years, we have been dealing with a geo-thermal plant in Northern Japan. It will be a factory for various plant derivatives to harvest energy from geothermal energy, and useful to develop carbon recycling. We are the sole chemical company in Japan investing in geothermal energy.

This year we started our joint operations in a Liquefied Natural Gas (LNG) energy power plant to revitalize the Fukushima Prefecture that suffered the tsunami and earthquake in 2011. We boost reconstruction and employment through the LNG power plant as well as through other plants regarding vegetation and agriculture.

Secondly, two other challenges for us are Hydrogen and CO2. Regarding carbon dioxide and its recycling, we have tested CCS and CCU, meaning, its storage and usage process to derive from it methanol as well as polycarbonate. Clearly, Europe is leading this field but we are rapidly catching up.

Additional vital pillars for us are the domains supporting Society 5.0 (regarding communication) and the provision of chemical compounds and materials for the aerospace and the automotive industry. Lastly, another crucial domain for us is the medical and food domain. In the medical field, it is an alarming fact that Japan imports almost 90% of all medicines; this is unsustainable for the country when talking about a field that will become crucial for our economy shortly.

Concerning the pharmaceutical field, we began a business providing antibody drugs and in the food field providing oxygen absorbers. The latter is located on food packages and its task is to prevent oxidation, which can be very useful in the medical industry as well. We head this field.


What is your midterm strategy?

Next year we celebrate our 50th anniversary since we merged so a new solid and dynamic midterm strategy is on its way. The four key pillars of our business segment are energy, information/ communication, medical/ food, and mobility.

To illustrate the mobility domain opportunity, SpaceX is looking to launch 40,000 satellites which happens to be a gigantic opportunity for us as fortuitously we have resins and polymers that are heat resistant. The aerospace offers us opportunities such as the possibility of moving from 5G to 6G. Regarding the mobility domain, making smart cars a reality (EVs and Autonomous driving vehicles) through providing materials that enable lighter cars, cars moving on hydrogen or fuel batteries.


If we were to come back in 5 years and interview you all over again what would you like to tell us, what are your dreams for the company and what would you like to have accomplished by then?

To my mind, the foremost issue as President of the company is to ensure the happiness and well-being of my employees. I faithfully believe that they are above the stakeholders in terms of relevance to the company. Throughout my presidency, I have tried and will continue to strive to ensure their development and job growth.

Profits derived for the sake of our employees, stakeholders are important as well but first comes the staff. We will continue to grow until we look into the eyes of leaders such as Elon Musk in the race for mobility and aerospace; and Tim Cook in the race for information and communication devices. As I always say “It is important to take risks in order make risk your friend”.