Initiation Speech
December 12, 2007
Mr. Akio Utsumi,
Mr. Katsumasa Hayashi
“Social Contribution and Trusts”
Mr. Akio Utsumi,
Chairman,
Mitsubishi UFJ Trust and Banking Corporation
In the trust business, the party entrusting the assets is defined as the “trustor”, and the entrusted party as the “trustee”. The party who receives the results of the administered assets is known as the “beneficiary”. This relationship of “trust and loyalty” among these three parties are the basic mechanisms of trusts.
The Trust Law and the Trust Business Law, which were introduced in Japan as the legal framework in the Taisho period, have recently been drastically revised after eighty years. One major point to highlight from the revision is the expansion of the scope of assets which can be entrusted. In addition to traditional cash, securities, monetary claims, personal property and real estate, it is now possible to entrust intellectual property rights such as patent rights. A framework has been established for entrusting a business as a whole and the areas in which trusts can be applied have expanded considerably. The range of companies that can be engaged in the trust business has also been expanded under the new framework, and non- financial institutions are now permitted to enter the trust business. After the revision of the Trust Business Law, 12 companies have newly entered the trust business (as of October, 2007). The Trust Company Association of Japan has now grown to 54 members.
Interestingly enough, the largest part of the industry’s economic activities involves the management of investment trusts for individual investors.
These days, in the field of corporate finance, asset liquidation is growing rapidly as a new means of raising funds. In real estate securitization, 80% of transactions utilize trust beneficiary rights.
Trusts also serve an important role in designing the framework for the management and the administration of corporate pensions.
In addition, there is a growing interest in will trusts and other services related to inheritance for elderly citizens.
Trusts are also being actively utilized for social contribution activities. For example, public trusts are structured to support public interests and activities by using private-sector funds, and the structure is widely used for the provision of academic scholarships and research grants.
Therefore, trusts are not only an infrastructure for economic or financial activity, but can serve as a significant infrastructure for social contribution activities as well. I believe the role and expectations for both social contribution and trusts will become increasingly larger.
As a trustee, entrusted with high-valued assets, we are determined to dedicate ourselves to serving our trustors by fulfilling the duties of administration with ultimate responsibility and loyalty.
“The Job of Technical Development”
Mr. Katsumasa Hayashi,
Vice President and Representative Director,
Naigai Industries, Inc
Today, I will speak about the essence of ‘Technical Development’ for custom made products and machinery in the food and equipment industry.
Our company has the tradition to assign one engineer who will assume the entire responsibility of completing a “project” commissioned by our users. We refer to this tradition as the “one person one project” style.
It is a system where one engineer will be responsible for working together with people from our customer’s product development and production divisions to decide the precise specifications for production of the machinery used for production, the line and the facilities, as well as for the whole process of designing, price quotation, order receipt, manufacturing, construction undertaking, test operating, delivery, and maintenance.
Naturally, we have developed an adequate internal system to support the engineer assigned to the project. However, there is a lot of pressure involved to deliver quality custom-made production equipment and facilities involving a production development stage, on time for the scheduled deadline.
By its nature, custom-made technical developments will always encounter initial failures. We are very thorough with our rigorous preparations for the designing and the manufacturing processes such as conducting tests, making test models, and obtaining the necessary test data, but there are times when we encounter unexpected issues upon the test operations. However, the assigned engineer will always ensure that all issues are resolved on time before the actual start of production. While the challenges the engineer face are great, what can the company do in the best interest of the engineer as well as itself?
1. Unexpected contingencies must be resolved immediately by the company’s own hands, no matter how much the cost. The company must accumulate and establish the financial strength to endure the cost burden when they become necessary.
2. Another key note regarding the importance of technical development is maintaining the independence and the ownership of our company. Our customers commission us to manufacture machinery used in the most crucial part of their production lines. We need management that can make decisions that will be trusted by our customers and put them into practice, under any circumstances. Management cannot be influenced by any external party other than the customer.
3. The company shall hire new graduates and train them year after year, even when and if the company’s performance is being challenged. Our customers will also hire new dedicated employees in a similar situation. The young employees will share their hardships and accumulate successful experiences, and build extensive relationships of trust that will mature along with the development of their career. These people will eventually become the cornerstone and bearers of tomorrow’s gastronomic culture, and social development.
These are the three essential points which represent the company’s resolution and philosophy.