Management & Utilization of Intellectual Property and Intangible Assets

Intangible assets, including the technology and innovation creation capabilities pursued by the FCRL and IDeC, are the source of the Group's competitiveness. To revitalize innovation, the Group is not only encouraging R&D but also the creation and use of intangible assets, such as the intellectual property found throughout our entire supply chain. The Intellectual Property Department continuously creates an intellectual property portfolio that is linked to securing the Group's competitive advantage and promotes the intellectual property strategy utilizing the IP landscape.* Regarding patent applications, we are acquiring patents to differentiate ourselves as a company and focusing on identifying areas of our patent portfolio in which we can take an offensive stance in anticipation of our future portfolio. Further, we will build inventions that utilize our patents in collaboration with other related departments, leading to the creation of future customer value. Intellectual property activities are regularly reported to the Board of Directors, and a system has been established in which the Board of Directors effectively supervises them.

We analyze and assess the value of the Company's intellectual property and intangible assets, including data and know-how, leading to strengthening its business competitiveness. Creating intellectual property by investing in intellectual capital and generating profits by increasing customer value will promote our intellectual creation cycle of "Create," Protect," and "Earn," which brings a virtuous cycle for reinvestment.

The characteristics of our businesses differ significantly in the Company's three business fields, and as part of this, the role of intellectual property and intangible assets also differs. Accordingly, we use differing approaches in each business field to promote the acquisition and utilization of intellectual property and intangible assets, contributing to increasing business profits. Below, we have provided an example of our utilization of intellectual property and intangible assets in each business field.

As a system to strengthen intellectual property and intangible assets, we are promoting related initiatives through the entire Group by nominating people in charge of intellectual property or its promotion at the various technical divisions and affiliated companies, in addition to the Intellectual Property Department at Head Office.

We share details of surveys and analysis, such as intellectual property reports that are regularly published, to raise awareness of intellectual property across the entire Group, including among staff from the Administrative Division and corporate departments.

In addition to conducting training for new employees, engineers and designers whose work closely intersects with intellectual property, we publicly recognize employees who create and utilize outstanding intellectual property and intangible assets through awards.