Director, CSO, and Managing Executive Officer


FY 3/2022 in Review

After I assumed the position of CSO responsible for overall Group strategy in 2021, the world entered an era of volatility, uncertainty, complexity, and ambiguity—so-called VUCA. The ongoing COVID-19 pandemic, the situation in Russia and Ukraine, soaring raw materials prices, the sharp depreciation of the yen, and increasing inflationary pressure have made steering through the challenges difficult. Amid these circumstances, we gather information from a micro perspective on the front lines and assess the situation from a macro perspective, looking at trends across global society as a whole and changes in the environment. With this information, we leverage the management planning platform over which I am responsible to address management issues that include how to operate global supply chains, how to incorporate Japan's food security and energy security, and how to manage global risks. Integrating this information and knowledge makes the necessary decisions clearer. For example, when looking at the global market, we understand the situations in the United States, Mexico, and Brazil discretely and locally. However, decisions are made differently when looking from a high-altitude view over the Americas as a whole. The role of our division is to engage in this type of analysis.

Supporting NISSIN FOOD Group Sustainable Growth Strategy From a Financial Perspective Supporting NISSIN FOOD Group Sustainable Growth Strategy From a Financial Perspective

Maximizing the Corporate Value
of the
Through High-Level
Structural Reforms

The Mission of the CSO

My mission is to maximize the corporate value of the NISSIN FOODS Group by taking charge of the holding company’s portfolio and pursuing reform across group companies in response to changes in the times and environment. Maximizing environmental value, social value, and economic value includes all activities and requires leadership over the planning and execution of structural reforms. Analyzing and evaluating activities across the entire group is another important part of this mission. In other words, I see myself as a corporate scientific orchestrator who supports overall management from a scientific perspective.

I believe the value I contribute is constantly absorbing and digesting the latest information, making recommendations to management. Where should we invest in people, goods, and financial resources to achieve our management goals? How do we design the organization, systems, and processes to implement these measures? We must work comprehensively, including M&A and other strategic alliances. At the same time, we continue to discover issues and formulate solutions in an ever-changing business environment. An important mission of our corporate planning platform is to coordinate information from a group-wide perspective and provide a cross-organizational view. We do this by having a group of specialists cover everything from corporate planning to global sales, and from information and DX to supply chain restructuring under our purview. I believe this division will serve as a hub to create synergies for the entire group.

Finance and Accounting Division Commitment to Improving Corporate Value Finance and Accounting Division Commitment to Improving Corporate Value

The NISSIN FOODS Group Mid- to Long-Term Growth Strategy

FY 3/2022 was the first year of the NISSIN FOODS Group Mid- to Long-Term Growth Strategy. The key to implementing this growth strategy is a long-term vision. In the process of formulating this strategy, we discussed when, where, and what we should invest in over a 10-year span. Assuming the first year of the growth strategy was for each operating company to create an investment plan from a long-term perspective, the thrust of the second year will be to determine investment priorities for the management resources we possess. Of course, things must be prepared in a certain order, so the most important of the three strategies is to strengthen the cash-generating capacity of existing businesses. We will achieve sustainable growth by investing cash generated from existing businesses into the second growth strategy, EARTH FOOD CHALLENGE 2030, and the third, which is to pursue new businesses. In particular, we see the overseas and domestic non-instant noodles businesses as an area of potentially remarkable growth. As consumer needs diversify, we believe we can provide new food opportunities by expanding the coverage of the NISSIN FOODS Group brand and by offering a broad range of opportunities.

Create a System for Developing Diverse Human Resources

Investment in human resources is essential for achieving this vision. We believe it will become increasingly important to manage not only total shareholder return, which is economic value, but also talent, strategy, and risk in terms of personnel organization. As we introduce a job-based personnel system, we will build a strong, sturdy, and muscular organization. In particular, building a mechanism for nurturing management personnel and global human resources is an urgent issue. No matter how good the strategy, nothing will come to fruition without the people to put plans into action. At present, we are examining what kind of human resources are required to advance the NISSIN FOODS Group global strategy.

We also believe diversity is required to build work environments where diverse personnel can work with vigor and enthusiasm. Here, I mean diversity not only in terms of gender, but also in terms of country, culture, age, and other various aspects. So, how do we bring out the best in each individual and tie this personal growth to the growth of the company? We are building a human resource management system that fully utilizes the abilities of each individual, designed to draw out the market value of each employee.

Structural Reform in the Digital Age

NBX (NISSIN Business Transformation) is a project under which we leverage digital tools to achieve structural reform in all areas, including logistics, sales, human resources, production, and materials. We aim to achieve 200% productivity under the banner of Armed With Digital to establish competitive advantage. We also aim to evolve into a corporate group that continues to grow in any era by transforming business operations, our organization, our processes, and our corporate culture. We have already seen a shift to a paperless work environments in the finance and sales departments. Employees are changing the way they work, as each individual becomes more motivated, now that they spend time on offering proposals and negotiations instead of paperwork. In the future, we intend to implement efficient supply chain management using a database of consumer behavior and information. We are also engaged in activities that will lead to marketing based on a 360° understanding of the consumer utilizing personal consumer data. Current trials include various ways to determine scope for big data, perspectives, and methods of analysis.

Finance and Accounting Division Commitment to Improving Corporate Value Finance and Accounting Division Commitment to Improving Corporate Value

Enhancing Corporate Value Further

Last year, we began quantitative analysis of the relationship between ESG (non-financial value) and corporate value as part of our efforts to answer the question of whether corporate ESG initiatives really lead to higher corporate value. This initiative consists of two parts: a high-level analysis we call Return on Sustainability Index (analysis of the correlation between ESG activities and price-book value ratio (PBR)) and a value-related analysis we call Return on Sustainability Index Correlation (correlation between EPS/PER and ESG activities). The Return on Sustainability Index analysis showed a 1% increase in the number of products contributing to social issues improves PBR by 1% in the same year. Our research also indicated 1% reduction in CO₂ emissions improves PBR by 1% after eight years.

Our proprietary Return on Sustainability Index Correlation Analysis linked together correlated items. In this way, we formed a clearer story of how ESG actions lead to an increase in corporate value (stock price). We will continue to accumulate data to refine our analysis and visualize the relationships and pathways among ESG indicators to achieve higher levels of CSV management.