Provided is a novel aromatic ring compound having a GPR40 agonist activity and a GLP-1 secretagogue action. A compound represented by the formula: wherein each symbol is as described in the DESCRIPTION, or a salt thereof has a GPR40 agonist activity and a GLP-1 secretagogue action, is useful for the prophylaxis or treatment of cancer, obesity, diabetes, hypertension, hyperlipidemia, cardiac failure, diabetic complications, metabolic syndrome, sarcopenia and the like, and affords superior efficacy.