Purpose and Goal of Sustainability Management
Guided by the corporate philosophy, “Otsuka-people creating new products for better health worldwide,” the Otsuka group is dedicated to contributing to the health and Well-being of people around the world by providing innovative products and services. At the foundation of this value creation is our commitment to sustainability management, which seeks to harmonize the resolution of social issues with business growth (See Figure 1).
In recent years, the social issues we face have grown increasingly diverse and have undergone rapid changes. These include climate change, resource limitations, demographic shifts, evolving healthcare needs and values, human rights abuses, emerging geopolitical risks, and the growing complexity and potential disruptions within supply chains.
In response to these issues, we have established a sustainability mission at the core of our management strategy: “the Otsuka group works to solve social issues through its businesses and contribute to the creation of a healthy and sustainable society, while achieving growth.”
We also position “long-term value creation” and “resonance with society” as fundamental pillars guiding our strategic decision-making. These pillars are aligned with our sustainability mission and are reflected in our decision-making process, which incorporates forward-looking perspectives on the environmental, social, and governance “ESG” pillars. We believe that incorporating these perspectives into management not only achieves short-term outcomes but also enables decision-making with the flexibility and foresight needed to anticipate social changes and create opportunities for sustainable growth.
Moreover, we recognize that a wide range of social issues—including climate change—are closely linked to our business operations. We view our response to these issues not merely as a matter of corporate social responsibility, but as a material factor in enhancing corporate value. Therefore, to achieve sustainable growth, we continue striving to address social issues, evolve to meet future demands, and deliver new value.
Ensuring Governance and Transparency
To ensure the effectiveness of our sustainability management, a robust governance structure is indispensable. The Otsuka group has enhanced the supervisory functions of Otsuka Holdings Board of Directors and established a cross-functional task forces and committees centered on the “Otsuka Group Sustainability Promotion Committee.” This structure facilitates tracking progress toward activity goals aligned with the materiality identified in 2024, as well as the formulation and implementation of essential initiatives (See Figure 2). It is positioned as the platform for our sustainability management and will continue to expand and enhance its activities across the organization.
Regarding sustainability information disclosure, we recognize that it is not merely a means of regulatory compliance. Rather, it enables us to adapt to a changing society and achieve sustainable growth for the group. We are committed to promoting transparent and trustworthy management practices in accordance with international frameworks.
Enhancing the Human Capital Strategy
The materiality identified by the group indicates key areas essential to fulfilling our responsibilities as a total healthcare company. Among these, human capital stands as the cornerstone of innovation and represents the most critical asset underpinning our corporate strategy. To enhance our organizational foundation and strategically invest in human capital, we are advancing the integration of our human resources and management functions. This includes implementing data-driven human resources initiatives through KPI-based management, enabling more sophisticated and effective personnel strategies.
As part of these initiatives, we utilize a comprehensive talent database to visualize employee skills, career visions, and engagement levels. By leveraging people analytics, we aim to optimize talent management, thereby fostering both individual growth and overall organizational productivity.
In response to the evolving global business environment, digital transformation, and the imperative for innovation, we are also focused on cultivating the next generation of leaders who will drive future business and management. To this end, we offer selective training programs, mindset development initiatives, and reskilling opportunities. Through these initiatives, we are committed to building a resilient and diverse talent base that will serve as a powerful engine for the continued growth of the Otsuka group.
Creating an Environment to Maximize Human Resources
The Otsuka group has consistently created unique value, grounded in its corporate culture of Ryukangodo (by sweat we recognize the way), Jissho (actualization) and Sozosei (creativity). As our business continues to expand and diversify, embedding this culture deeply across the group is recognized as a critical foundation for sustainable growth. We place great importance on cultivating a workplace environment where all employees feel safe to express their viewpoints, collaborate respectfully across differences, and contribute meaningfully.
We believe that a workplace in which each individual is respected enhances employee engagement and strengthens organizational capability.
Based on this understanding, our 4th MTMP has established a cross functional task force led by human resources representatives from main operating companies. This task force promotes shared values around our corporate philosophy and culture across different business sectors, fosters a common understanding of the importance of cultural integration and employee engagement, facilitates the exchange of best practices, and works toward establishing unified assessment and evaluation methodologies.
Furthermore, respect for human rights is not only a fundamental responsibility of a global enterprise but also a cornerstone of creativity and sustainable growth. In accordance with the United Nations “Guiding Principles on Business and Human Rights,” we are committed to ensuring diversity and inclusion among our employees. Furthermore, we are conducting human rights risk assessments across our supply chain, implementing regular surveys for employees, providing feedback to management and department heads, and developing measures based on results.
We recognize that psychological safety fosters open communication, encourages innovation, and enables individuals to take initiative. Promoting employee engagement through the integration of our corporate philosophy and culture, along with establishing a workplace environment that respects human rights, enables us to strengthen human capital, enhance the group’s competitiveness, and maximize corporate value.
Creating the Future
Guided by our corporate philosophy, the Otsuka group is committed to advancing sustainable management practices into the future. Even in a rapidly changing era, the group will continue to innovate with resilience and determination, proactively addressing emerging health issues through the development of forward-looking products and services. In doing so, we aim to resonate with society and remain a company that contributes meaningfully to the Well-being of people worldwide.
We are deeply grateful for the continued support of all stakeholders, and we look forward to your ongoing encouragement as the group continues to evolve and grow.