Fall 2008 saw the global economy engulfed in what is said to be the worst crisis in a century, changing the business environment drastically. The automobile industry was not spared from this rapid transformation, and FY2008 was a ferociously challenging year for Mazda Motor Corporation.

My appointment to the post of president of Mazda arrived in the middle of this dramatic shift in the business environment, and I soon had many opportunities to realize how vital the support of stakeholders is for the growth of the Company. To ensure that it responds sincerely to the concerns of stakeholders, Mazda is positioning corporate social responsibility (CSR) as the foundation of its management, determined to advance sound and transparent management in all aspects of Mazda's business activities.

Through the office of the CSR Management Strategy Committee, established in April 2008, Mazda is implementing CSR measures in earnest. As we reflect on the CSR activities of the Company in FY2008, we are also engaging in dialogue with a wide range of stakeholders to understand what society hopes for and expects from Mazda. As an automaker with operations that span the globe, Mazda is confronted with a long list of CSR challenges. However, three key commitments have been set as priorities for Mazda: preserving the environment, respect for people, and social contributions. By advancing a range of projects in these three core areas, Mazda seeks to contribute to the realization of a sustainable society.

Global warming is an issue of critical importance for the human race. In June 2009, the Japanese government published its medium-term target (to be reached by 2020) for the reduction of greenhouse gas emissions. The announcement was timed to precede post-Kyoto Protocol negotiations, scheduled to begin in Copenhagen in December 2009. At this critical juncture, Mazda is adopting a robust response to global warming as one of its top priorities as an automaker. We are building the reduction of environmental impact into all phases of our business activities, from development through production to distribution.

In products, for example, our basic manufacturing policy is to provide all our customers with excellent environmental performance without compromising the joy of driving. This commitment applies not to a small selection of eco-friendly cars, but to all Mazda vehicles. Toward this end, we are radically improving the efficiency of internal combustion engines and reducing vehicle weight to improve fuel efficiency for all models. By 2015, we will increase the average fuel economy of all Mazda models sold worldwide by 30% compared with 2008 levels.

Setting its sights on the long-term, in 2009 Mazda created a new department dedicated to the development of electric device technologies. This department's purpose is to accelerate Mazda's innovation in hybrids and other electrical devices, to meet medium-term demand for technologies that improve fuel efficiency. The fruits of this initiative first appeared in June, when Mazda rolled out the all-new Mazda Axela (known overseas as the new Mazda3) fitted with i-stop, an idling stop system that improves fuel efficiency by approximately 10%. Further ahead, Mazda plans to combine this and other fuel-saving technologies with a radically redesigned internal combustion engine to reach new heights in fuel-efficient performance.

In the long run, it will be necessary to achieve an automotive society that does not depend on fossil fuels at all. For many years, Mazda has been working diligently on the development of hydrogen vehicles equipped with hydrogen rotary engines. These engines run on hydrogen, widely lauded as the most promising next-generation fuel, producing zero CO2 emissions. In March 2009, Mazda began commercial leasing of the Mazda5 Hydrogen RE Hybrid. Through trials on public roads, Mazda is steadily perfecting this amazing technology for the future.

At Mazda, we want each one of our cars — zoom-zoom feeling — to look inviting to drive, be fun to drive, and make you want to drive them again. We are committed to making the driving experience more compelling with each successive design, even as we strive toward a safe automotive society with zero accidents, and a world in which automobiles coexist and thrive along with a healthy global environment.

Since its foundation, Mazda has proudly conducted operations with deep roots in local communities. Each place of business in the Mazda Group strives to invigorate the surrounding region in diverse ways. Even amid the general decline in car sales, continuing from the second half of 2008 to the present, Mazda enjoys solid support from local communities and enterprises, many of which purchase Mazda vehicles. As the economic headwinds continue in 2009, Mazda is looking with renewed appreciation and gratitude upon its treasured role as a member of the communities in which we do business, shouldering our responsibility to exceed the expectations of all the people who have supported us. Marshaling its Group-wide resources, Mazda is determined to see this difficult period through and emerge stronger than ever.

Modern society faces many issues, such as global warming, that are both complex and immensely challenging. As a corporate citizen, we carry out activities to support the local community at each place of business, in ways that are firmly rooted in the specific needs and traditions of that community. In so doing, we grow our business in a sustainable fashion, increasing the prosperity of the community along with our own.

As the environment in which we do business changes moment by moment, the demands and expectations society holds for us as a private enterprise shift as well, and Mazda must change to reflect and serve those needs. In 2008, Mazda collated the body of approaches and attitudes that had guided its employees' work over the years and established the Mazda Way, a formal set of seven principles. So organized and formalized, the Mazda Way could be shared by all Mazda Group employees around the world. Amid a constantly changing social landscape, we use the Mazda Way as a guide for the Group as we endeavor to fulfill our responsibilities to society, and earn the trust of stakeholders as a global corporate citizen.

Unquestionably, 2009 has been one of the most challenging years that Mazda has ever faced. But Mazda is a company with a long history of overcoming seemingly insurmountable challenges. That experience has given us both the memory of victory over terrific obstacles and the will to confront the adversity that lies ahead. With Group-wide unity of purpose, the employees of the Mazda Group are eager to transform the trials of 2009 into a historic turning point, ensuring that Mazda will continue to shine brightly five or ten years into the future and beyond.

Mazda is carrying out the corporate activities needed to realize a sustainable society, striving to make people, cars and the Earth fun.