Management Policy

President’s Message


Yasuhiko Saitoh

Mobilizing our strengths to provide products that help solve customer and societal issues in an effort to achieve sustainable growth








Record performance by leveraging our strengths

In the fiscal year ending March 31, 2023 (FY2022), our company extended its growth path with another set of monumental results.

I would like to reiterate that the results reflect the underlying strength of our line of products, technology, operational system, and our people’s professionalism.

We are very pleased that we have contributed to the well-being of our communities while renewing the records across the top line and bottom line and in key financial ratios.



Shareholder returns and future growth

With this performance and further enhanced financial strength, we declared an annual dividend of \500 per share (before the share split), which is 25% higher than last year and records the highest mark in the company’s dividend history. It represents our sincere appreciation to our shareholders for their understanding and support.

There may be some concern among our shareholders and investors about how we will sustain this level of earnings and grow from it. In this regard, with a strong sense of purpose, we keep our focus on providing our customers with products which make it attainable for them to do what they pursue. We tirelessly help solve what our customers need to solve. As changes take place fast and our customers’ needs constantly evolve, opportunities present themselves for us. With a strong market-in mindset and aspiration, we work with our customers more closely than ever. We are determined to be a most reliable supplier to all our customers with best-in-class quality, technology and practice.


Current situation and outlook for each business segment

If I may elaborate on it by laying out our prospects and on-going endeavors in each of our business segments,

[Infrastructure Materials Business]
We are determined to maintain our capacity edge and cost competitive edge. Building upon it, we will reinforce our engagement in broader applications and to make our products the greenest infrastructure materials, we will reduce the carbon footprint in our manufacturing of the products.

[Electronics Materials Business]
The demand for semi-conductor devices will keep expanding in an appreciable manner. As the growth is not only quantitative but also qualitative, we will stay tuned to capacity increases and product developments. There is an evolving array of new ways of device making, to which we apply our expertise and ingenuity. Electrification is rapidly expanding and the so-called green transformation is irreversible. To this end, we will exploit the periodic table as much as we can for our customers and industries. Furthermore, initiatives for economic security are being taken by major nations. We play an essential role every aspect of all these developments.

[Functional Materials Business]
We are bringing more of new products to various markets and are broadening our capabilities for our customers. We add touch points in industries and markets so that our total addressable markets will be greater. We develop our product offerings with this focus and make contributions in such a manner that the more our products are used, the better the industries and human society become.

[Processing and Specialized Services Business]
With this group of businesses and operations, we enhance the synergy within the group.


Being a good partner for society

Concerning carbon neutrality, we have recently announced our plan. We are determined to do our part as an essential supplier to human life and industries in the world.

To continue to do what we have been able to do for our customers, our shareholders and our communities, it is essential that the company continues to grow. We will remain focused on our customers and their needs to be relevant to them, will remain committed to governance to be relevant to our shareholders and will remain responsible to be relevant to our communities.


Succession of “Kanagawa management” and appreciation to all stakeholders

I must mention that the passing of Mr. Kanagawa at the beginning of the year was a great loss for our company. We will carry on his torch and move forward with vigor. Our board, newly realigned, will assure you of it.

I sincerely thank our shareholders for their confidence, our customers for their partnership and our entire Shin-Etsu team for their dedication to our operations.



Yasuhiko Saitoh President

Yasuhiko Saitoh

Business and Other Risks

Among the matters relating to the status of business and accounting, etc. described in the Annual Securities Report, the major risks that management recognizes may have a significant impact on the financial position, business results, and cash flow status of the consolidated companies are as follows.
The Group (the Company and its consolidated subsidiaries and affiliates which are accounted for using the equity method, hereinafter referred to as “the Group”) strives to prevent, disperse, and hedge potential risks and thereby mitigates risks. However, there is a possibility that the operating performance of the Group may be impacted significantly should any unforeseeable circumstances arise.

Indicated are principal matters that are considered to likely be risk factors based on the Group’s judgment as of March 31, 2020, and do not cover all risks related to the Group.

1. Risks related to Economic Situation and Market Conditions
The economic situation in the countries and regions where the principal markets of the products handled by the Group are located may significantly impact the operating performance of the Group. Further, some of the main products handled by the Group may be subject to significant price fluctuations due to changes in global supply and demand conditions. The Group hedges potential risks by promoting diversification and globalization of businesses. However, a decrease in demand or an intensified price competition related to a Group’s product may have a significant impact on the operating performance of the Group.

2. Risks related to Foreign Exchange Market Fluctuations
In the fiscal year ended March 31, 2020, overseas sales accounted for 73% of consolidated net sales of the Group. The Company expects the ratio to remain at a high level going forward. Significant exchange rate fluctuations may affect the results when converting overseas group companies’ business results on financial statements into Japanese yen and consequently have a significant impact on the operating performance of the Group. Significant exchange rate fluctuations may similarly affect foreign currency-denominated transactions and there is no guarantee that such risks can be completely avoided, although the Group takes risk-mitigating measures such as making use of foreign exchange contracts.

3. Risks related to Natural Disasters and Unpredictable Events
The Group strengthens countermeasures to ensure damage from any unforeseen interruption in production activities is kept to a minimum, and this includes regularly conducting inspections and maintenance activities for disaster prevention, and making capital investments to ensure safety. The Group also strives to operate at multiple production sites. However, unpredictable events and natural disasters may cause physical damage to the Group’s production facilities and other properties, or the occurrence of supply chain disruptions, and these may have a significant impact on the operating performance of the Group.

4. Risks related to Laws and Public Regulations
Countries and regions in which the Group conducts its business activities are subject to various laws and regulations, including investment permits, import and export, commercial trade, labor, patent, taxation and foreign exchange. Modifications to such laws and regulations may have a significant impact on the operating performance of the Group.

5. Risks related to Procurement
The Group’s production activities depend on various raw materials and the Group strives to ensure stable procurement of raw materials by avoiding being dependent on specific sources for such. However, a lack of or delay in the supply of raw materials, changes in trade policies in the supplying countries, or a price hike caused by such circumstances, can have a significant impact on the operating performance of the Group.

6. Risks related to Rapid Technological Innovation
Technological advances are remarkable in the electronics market, which is one of the main industries to which the Group distributes its products. As such, the Group makes ongoing efforts to develop cutting-edge materials that can readily respond to technological innovation. However, if the Group faces difficulty in appropriately responding to changes in the industry and related markets, this may have a significant impact on the operating performance of the Group. In addition, the emergence of competitive substitute products may have a similar impact on products for industries other than the above.

7. Risks related to Environmental Issues
As a business entity that handles various chemical substances, the Group complies with various laws and regulations relating to the environment, as well as proactively implementing energy-saving measures to prevent global warming and taking steps to curb the emission of substances that affect the environment by maximizing efficiency. However, if it is technically difficult to respond to environmental regulations or a need arises to newly pursue a major capital investment due to the strengthening of environmental regulations beyond what the Group had assumed, this may have a significant impact on the operating performance of the Group.

8. Risks related to Product Liability
The Group is fully committed to ensuring optimal product quality in accordance with the characteristics of each product. However, should an unforeseeable quality issue arise, such may significantly impact the operating performance of the Group.

9. Impact of the New Coronavirus (COVID-19)
In order to minimize the impact of COVID-19, the Group’s business sites are implementing thorough safety and health measures. However, if the spread of the virus in the future and the policy of curbing economic activity in each country in the aftermath of it significantly reduces demand for the Company’s products and damages the supply chain, including the Company’s business sites, this may significantly impact the operating performance of the Group.

IR Policy

Shin-Etsu Chemical Co., Ltd. conducts IR activities to provide all stakeholders with a better understanding of the Company’s business and management. The Company listens to the views of shareholders and investors through dialogue and make use of their views to management.

Information Disclosure Policy

1. Basic Policy
We ensure fair and transparent disclosure to our shareholders and investors in accordance with Financial Instruments and Exchange Act and the Securities Listing Regulations stipulated by the Stock Exchange on which our stocks are listed. This is based on our understanding that timely and accurate disclosure of the Company’s corporate information to the shareholders and investors facilitates the understanding of the Company and brings appropriate evaluation from the market.

2. Information Disclosure Policy
The Company discloses information corresponding to material facts prescribed under the Securities Listing Regulations via the Timely Disclosure Network (TDnet) system of the Tokyo Stock Exchange, the Company’s website, and announcements made at relevant press clubs.
In addition to the aforesaid disclosure, the Company strives to disclose information that is considered to have a substantial impact on the investment decisions of shareholders and investors, and information that is likely to be useful for shareholders and investors to deepen their understanding of the Company via the corporate website in a fair and timely manner.

3. Matters Concerning Operating Performance Forecast
The information disclosed by the Company may contain forward-looking statements. These statements, such as operating performance forecasts, include risks and uncertainties since they are based on management’s judgment and assumptions in light of the information available at the time of disclosure of such information. The reader, therefore, should be aware that actual results may differ from any forecasts expressed due to various factors. Material factors affecting actual results may include overall economic conditions in which the businesses of the Company and its group companies are involved, the relevant market trends and fluctuations in foreign exchange rates. However, factors that may affect operating performance are not limited to those enumerated above.

4. Quiet Period
The Company observes a quiet period from the day following the financial closing date of each quarter until the day of announcement of financial results in order to prevent leakage of financial information and ensure fair disclosure. During this period, the Company refrains from making comments or answering questions regarding its financial results. However, if any event requiring disclosure under the Securities Listing Regulations arises during the quiet period, the Company will disclose information in a prompt and appropriate manner.