Message from the Managing Officer for Sustainability

Advancing business strategy and sustainability in tandem

Guided by the corporate philosophy of "Change and Challenge! For the creation of the future of Earth and People," the Nisshinbo Group conducts business activities throughout the world with the mission to contribute to society through business activities. The Nisshinbo Group continues to strive tirelessly to create products, technologies, and services that benefit society. Takeshi Sakurada, who became president of Nisshin Cotton Spinning Co., Ltd., in 1946, frequently communicated to employees a management philosophy centered on his theory that he called the "Five Functions of Management." This philosophy of entrusting capital, organizing human intelligence and technology, combining them to create value, providing that value to society, and redistributing profits has been passed down alongside the spirit of public entity and consistent integrity, and we view it as aligned with today’s approach to sustainability management. I assumed the position of General Manager of the Corporate Strategy Department at Nisshinbo Holdings Inc. in April 2025, and since then I have been driving forward our corporate and sustainability strategies as two pillars of our business. My belief that progress in these two pillars underpins the sustainability of the group has remained unchanged since last year. I believe that what we call nonfinancial information, including human capital, social capital, natural capital, and intellectual and technological capital, is at the very core of our business foundation. This is because these elements are inextricably linked to financial matters and can be viewed as working in perfect harmony to drive the business cycle. My conviction has grown even stronger as I have taken on the responsibilities for human resources and finance, in addition to business strategy and sustainability, starting in fiscal year 2026. Moving forward, I will continue to strive to ensure that the twin engines of the business strategy and sustainability strategy continue to function efficiently while maintaining a proper balance between them.

Fostering a corporate culture through dialogues with employees

The Nisshinbo Group is guided by the philosophy that business is people, and Nisshinbo considers human capital as an extremely important management resource. The term "people" here refers to all employees, including management, and means that the success or failure of our business ultimately depends on whether each individual is able to demonstrate their capabilities in their work. For the development of the business, employees must enhance their skills and capabilities and apply them effectively in their work while maintaining high motivation through a sense of accomplishment and fulfillment. The Nisshinbo Group uses the positive response rate from employee engagement surveys as an indicator of employees’ understanding of the company’s current situation and their level of alignment with the Nisshinbo corporate philosophy. While there is currently room for improvement in the scores, we believe this stems from concerns about the organizational changes and personnel assignments resulting from the structural reforms accompanying our portfolio transformation. Management has consistently communicated the company’s strategic direction to employees; however, we will further expand communication opportunities to foster a deeper understanding. In order to clearly communicate the vision and values of the Nisshinbo Group, management will go beyond one-way communication to foster two-way dialogues. We will create opportunities for dialogues between managers and employees and share these initiatives widely to invigorate the entire organization. This ongoing dialogue will deepen the understanding of and alignment with the corporate philosophy, leading to the cultivation of a better corporate culture. Furthermore, Nisshinbo will continue to invest in human resource development by continuing to conduct selective leadership training programs in which participants are nominated by department heads and senior management. Not only do participants facilitate training and dialogues in their respective roles but they also foster relationships of trust with fellow trainees in the same program, which then creates a virtuous cycle. Through these initiatives, we will continue to build an organization capable of sustainable growth.

Initiatives under the sustainability promotion plan to address key challenges

The 6th Sustainability Promotion Plan (FY2025-2027), formulated on the basis of materiality, is generally progressing smoothly. In the environmental sector, steady progress is being made in reducing greenhouse gas emissions and water use per unit of sales. The Nisshinbo Group has previously obtained third-party verification for greenhouse gas emissions (Scopes 1 and 2). Based on actual data for FY2025, Nisshinbo has also obtained third-party verification for water withdrawal data. Going forward, management will continue to improve data accuracy and ensure transparency while systematically implementing initiatives aimed at reducing the environmental impact of the company. Furthermore, after updating and refining the analysis of business risks and opportunities related to climate change (TCFD) and natural capital and biodiversity (TNFD), we are moving forward with the development of countermeasures. With regard to respect for human rights, Nisshinbo has been involved in human rights due diligence activities since 2023. In FY2025, we conducted a survey of the establishment and operation of complaint-handling mechanisms at all Group companies. While no major issues were identified in day-to-day operations overall, challenges were identified in the areas of multilingual support and the formal documentation of rules; therefore, we are working to improve these areas and strengthen the infrastructure. In FY2026, we will conduct a comprehensive human rights risk assessment to identify human rights risks in all business activities of the Group and translate these findings into appropriate corrective and preventive measures. With regard to risk management, we are strengthening the framework while utilizing external evaluations. In addition to continuing to provide e-learning and targeted email training to all employees, we are investing in physical security measures and will continue to work toward further enhancing risk control capabilities.

To all Stakeholders

I would like to express my sincere gratitude for your continued understanding and support of the company’s business activities. I believe that a stable and sustainable environment and society are prerequisites that allow the company to conduct business. If the environment or society is compromised, a company cannot engage in economic activities. That is why I believe that sustainability management is not something that can be achieved by a company alone, but rather something we must build together with all stakeholders. The Nisshinbo Group will continue to collaborate with all stakeholders while striving to achieve both a sustainable society and enhanced corporate value. We ask for your continued support and encouragement.

Tetsuya Kumakawa

Director, Managing Officer,
Nisshinbo Holdings Inc.