Message from the COO

The Kirin Group is a collective of those who take pride in delivering products and services that bring joy to consumers and patients, and who, in turn, find joy themselves in seeing those smiles through their craftsmanship. This reflects our Corporate Philosophy itself, and it is something I have personally experienced since my early days at the beer brewery where I was first assigned, working with colleagues to conduct various trials in pursuit of delivering great-tasting beer.

Meanwhile, as our business portfolio has transformed, the environment surrounding our Group employees, both in Japan and overseas, has also changed significantly. In particular, under the leadership of our CEO Isozaki, the “KV2027” initiative launched in 2019 has led to the Health Science Business achieving profitability last year and growing into one of our key pillars. By responding to a rapidly changing external environment and proactively shaping that environment, we have also strengthened the “earnings power” of our existing businesses in Alcoholic Beverages, Non-alcoholic Beverages, and Pharmaceuticals.

To achieve further growth from here, as COO, I will continue to strengthen our execution capabilities to create new value. As I mentioned earlier in relation to my experience at the beer brewery, even within the same company—Kirin Brewery—differences in productivity can arise from one plant to another. The key lies in whether three elements are in place: “equipment,” “systems,” and “people.” Among these, it is the “people” who operate the equipment and systems that are particularly critical to execution.

I believe the same applies to the Group as a whole. Through the “KV2027” transformation, we have made progress in establishing our business portfolio and strengthening our management systems. To build on these foundations and continue to create products and services ahead of the market, thereby driving further growth, it is essential to maximize the capabilities of each and every employee, both in Japan and overseas. Based on this recognition, we have positioned CSV as our unwavering compass and formulated our new Long-Term Vision “Innovate2035!,” which outlines “what we will pursue over the next decade.”

We have adopted a rolling three-year target framework starting from FY2025, updating our targets each year. What matters is that once the “mountain” we aim to climb is clearly defined, the path we take can be adjusted along the way, guided by what we can see in the year ahead. What is important is getting closer to the summit— execution is everything.

Since assuming the role of President & COO, I have continuously visited our business locations in Japan and overseas—the very gemba (frontlines)—and engaged directly with employees through ongoing dialogue. Through this dialogue, key challenges in strengthening our execution capabilities have become clearer. In response, to realize “Innovate2035!,” we have established the “KIRIN WAY,” which consists of the Group’s shared values, the “3 Values,” and the “6 Principles,” a set of behavioral guidelines for each and every employee to put into practice. In particular, the “6 Principles” are intended for each individual to take ownership of and put into practice. As these efforts expand from individuals to teams, across entire businesses and the Group as a whole, I believe we will evolve into an organization with stronger execution and transformation capabilities.

To use a football analogy, no matter how well-crafted the strategy may be, it is employees who execute, move forward, and score goals. In terms of execution at the gemba, employees are the forwards, while management plays a supporting role—delivering good passes from the back. When employees come to see that management is not above them, but that the gemba is above, and that they themselves are the ones who score the goals, I believe they will find their work even more interesting.

That’s why creating a state in which Group employees take ownership of the “KIRIN WAY” is our top priority for this fiscal year. It is essential that leadership takes the initiative and communicates thismessage, and under my leadership, our executives and the presidents of our operating companies have already begun to take action. One of the “6 Principles” is “Go To ‘Gemba’.” In addition to myself, the presidents of each operating company visit the gemba and engage in direct dialogue. Through these interactions, we are able to make sure firsthand whether execution capabilities on the ground are truly improving.

The challenges I identified varied by site, but in some cases, a risk-averse culture and multilayered approval processes limit proactive behavior. I also saw situations where employees find it difficult to make time to engage externally due to overwhelming consensus building internally. We quickly started reviewing systems of work process and evaluation.

It is leadership that ultimately shapes corporate culture, and there are no shortcuts. While I have stated that ensuring all employees take ownership of the “KIRIN WAY” is our top priority for this fiscal year, we have no intention of stopping after just one year. What matters is to continue these efforts steadily and sincerely. While this may appear to be a roundabout approach at first, once the effects begin to emerge, it will generate tremendous momentum.

Since assuming the role of President & COO in 2024, I have continued to observe execution at the gemba firsthand and have already begun to see very positive signs. These are reflected in last year’s performance. Both revenue and normalized operating profit reached record highs, and we achieved our targets across all business domains. Moreover, rather than losing momentum toward the end of the fiscal year, performance steadily improved, with momentum continuing to build. I also see a growing determination among employees to “follow through and achieve their goals.”

The EPS growth and ROIC targets presented in our new Long- Term Vision will be achieved without fail, with the gemba and management uniting as one team.

Our 2035 Vision is “Vitalize the world through innovation by our people and technology, as a global leader in CSV.” We define innovation as “encouraging behavioral change among consumers and patients and creating new lifestyle habits in society.”

As a company rooted in manufacturing, we must strengthen our capabilities to create new value and to deliver it to society. R&D, which creates value from zero to one, is the source of our growth. We position R&D as a core organizational capability to be particularly strengthened, in order to further enhance the power of fermentation and biotechnology—our foundational technologies shared across the Group’s businesses. It is essential that we continue to expand the pipeline of future business opportunities by generating new materials and exploring novel combinations of technologies.

The Kirin Group has a unique business portfolio spanning Alcoholic Beverages, Health Science and Non-alcoholic Beverages, and Pharmaceuticals. Across these business domains and research fields, we have researchers who, grounded in science, bring unique ideas, diverse approaches, and deep insight. As highly specialized talent that drives competitive advantage, a total of 228 employees across the Group held doctoral degrees as of 2025. When people with different careers, knowledge, and areas of expertise come together across business boundaries, a powerful chemical reaction can occur. This represents significant potential for innovation unique to the Kirin Group. In addition to promoting exchanges and transfers of researchers across business domains, we also established “Cowellnex,” which aims to pursue and commercialize innovation focused on health, in 2024 as a joint venture between Kirin Holdings and Kyowa Kirin.

However, creating value from zero to 1 alone does not constitute innovation. It must then be scaled up from 1 to 10, and from 10 to 100, and delivered to society. LC-Plasma represents a zero-to-one innovation. With the passion of bringing this value to consumers, talent from across the entire value chain—including marketing— came together and successfully commercialized it. The phrase in our vision, “by our people and technology,” reflects our—that people and technology function as two wheels of a single vehicle.

In the past, the Kirin Group has experienced the bitterness of being overtaken by competitors in markets that we ourselves created through innovation. That is precisely why we are committed to “continuously driving innovation”—by further improving the products we create through innovation, making them better, more enjoyable, and more effective. Through this continuity, our aim is for our products and services to become part of consumers’ lives and bring smiles, which we believe truly means “Consumer/Patient at Heart.”

Today, the global economy and business environment surrounding us are becoming increasingly uncertain, making it ever more difficult to anticipate what lies ahead. While we need to continue striving to anticipate the future, we must also take the initiative to shape the environment and influence consumer and patient behavior ourselves. Past successes do not guarantee future success. We must constantly interpret future consumer needs, respond to the various changes occurring around us, and translate them into agile and tangible proposals. As new generations such as Gen Z and Gen Alpha emerge and values continue to evolve, we are being challenged on how quickly we can adapt and transform into an organization capable of delivering value that meets the demands of the times. We live in an era where maintaining the status quo means falling behind. I believe it is essential to continue taking risks and maintaining a proactive, forward-looking mindset.

In a time of constant change, we must never lose sight of where we are headed. The Kirin Group has a clear and unwavering foundation in CSV management. Our mission is to create both social and economic value through our businesses. For us, being proactive means being committed to winning in terms of delivering both social and economic value. By creating an environment in which each employee can fully pursue “what I truly want to do,” we will maximize our ability to generate innovation.

What I envision is a Kirin Group that continuously brings a diverse range of exciting products and services to the world ahead of others. We aim to deliver a steady stream of compelling proposals related to both mental and physical well-being—offerings that make consumers think, “I want to use this” or “I want to try this.” Through this, we want to ensure that the unique appeal of the Kirin Group is widely recognized. We aspire to be a company that inspires people to wonder, “What will Kirin create next?”—and one that attracts those who think, “I want to try creating something exciting at Kirin myself.” Ultimately, we aim to contribute to both the mental and physical well-being of consumers and patients and help build a society filled with smiles.