Introduction
This year, S&B Foods Group marks the 100th anniversary of its founding. I would like to take this opportunity to express my heartfelt gratitude for your warm support and patronage.
Throughout S&B Foods' history, we have continued to utilize spices and herbs, the Earth’s blessing, to create products with a focus on taste and quality. Looking ahead, it is vital that we continue to make people’s lives more convenient while also engaging in global environmental conservation to achieve sustainability for both society and S&B Foods.
We marked the 100th anniversary by adopting “Our lives with Spices & Herbs” as our new corporate message. This message encapsulates our aspiration to provide the world with foods that are not only delicious but also healthy and reliable and to live in harmony with the Earth through sustainable plant and food businesses focused on spices and herbs.
Under our Corporate Philosophy “Bring natural life and happiness to every household,” we strive to be regarded in society as an irreplaceable company and individuals, to ensure stakeholders’ continuous recognition of our values for the next century.
Our goals
At the S&B Foods Group, we have set forth our vision as follows: “With the potentiality of ‘Spice and Herb, the Earth’s Blessing,’ we create a flavorful, healthy and bright future.”
Since our founder Minejiro Yamazaki became the first person to successfully manufacture curry powder locally in Japan in 1923, the S&B Foods Group has continued to deliver a variety of products to customers, including curries, peppers, wasabi, and other spices, condiments, and instant foods, enabling customers to experience spices and herbs at home.
Today, amid the progress of globalization, digitalization, and other changes in the social environment, we believe that people have an increasingly diverse range of individual preferences, values, and lifestyles, with more complex and sophisticated food-related needs. At the same time, we are faced with social issues demanding an urgent response, such as climate change and the resulting food crisis and the depletion of resources and increase in waste due to the pursuit of short-term profits.
As a leading spice manufacturer, we will continue to strive to advance and develop foods including spices and herbs and solve social issues by reducing environmental impact from the farm to the dinner table and engaging in sustainable ingredient procurement and product supply with consideration for society, the environment, and human rights.
Review of the Second Medium-Term Business Plan and Overview of the Third Medium-Term Business Plan
Review of the Second Medium-Term Business Plan
During the term of the Second Medium-Term Business Plan, which we launched in April 2020, we faced successive events that significantly affected business activities, such as the COVID-19 pandemic and Russia’s invasion of Ukraine. The restrictions on movement associated with COVID-19 were relaxed in fiscal 2022, the last year of the plan, and there were signs of normalization in daily life and economic activity. Meanwhile, the outlook for the future remained uncertain, with the rapid depreciation of the Japanese yen in addition to soaring raw material prices and supply restrictions due to the impact of the prolonged conflict in Ukraine. The food industry saw continuing changes in consumer behavior and market structure with the return of demand for eating out, as well as price hikes resulting from factors such as soaring raw material and energy prices. The business environment remained adverse, with further price hike concerns and related anxiety over the future giving rise to a frugal mindset among customers.
In fiscal 2022, the final year of the Second Medium-Term Business Plan, we aimed to achieve financial targets including sales of 119.0 billion yen and operating income of 8.5 billion yen. We achieved our sales target, mainly due to a strong performance from products such as Golden Curry and powder roux, in addition to the continuing recovery in demand for eating out. Although operating income exceeded our targets for the first and second years of the plan, we were unable to fully absorb the impact of soaring prices for ingredients through our own efforts for rationalization and greater efficiency. Despite implementing price revisions for a wide range of products since June 2022, we faced an unfavorable situation in the final year of the plan, with operating income falling short of our target.
Regarding our non-financial targets, we have steadily progressed with our initiatives for sustainable procurement. We also achieved some success in raising the awareness of working styles among each employee, cultivating a corporate culture that promotes diversity, and promoting the health of our employees.
Going forward, we must reorient toward profit and reform our earnings structure with a constant focus on whether our business activities contribute to well-being and sustainability, so that the S&B Foods Group can win even greater trust and empathy from all our stakeholders. We think it’s crucial to push ahead with the expansion of our business scale and profits by continuing to bolster key areas and creating new businesses and business models that anticipate the future.
Third Medium-Term Business Plan
In formulating the Third Medium-Term Business Plan, which spans the period from April 2023 to March 2026, we considered it vital for the Group to grow through challenging reforms to achieve our vision for the future. We therefore established three long-term themes: “aim for an overseas net sales ratio of 40% by 2043, in 20 years,” “accelerate research into spices and herbs and further deepen our initiatives to acquire cultivation techniques and develop growing areas,” and “reinforce these initiatives through training aimed at the development of global human resources, digital human resources, researchers, etc.”
With the social environment undergoing substantial changes, companies and their products are subject to an ever more diverse range of demands. At the S&B Foods Group, we have identified issues of high importance (materiality) and established the S&B Foods Mission as the goal of our activities, aiming for perpetual existence and growth as a company that provides value to society. Under this mission, we are working to contribute to achieving the SDGs through our businesses as we push ahead with business activities in line with our activity themes. The basic policy of the Third Medium-Term Business Plan is to “advance and develop food around the world and contribute to a sustainable future through businesses built around ‘Spice and Herb, the Earth’s Blessing.’” Our efforts will focus on key measures formulated to achieve each of our five key strategies: “provide products of value,” “invest in growth areas,” “achieve sustainable businesses,” “revitalize our people and organization,” and “live in harmony with the Earth.”
Our financial targets for fiscal 2025, the final year of the plan, will be affected by the planned transfer of the cooked foods business in March 2024, but we plan to offset this impact, mainly through the expansion of the overseas business.
For our non-financial targets, we have established 12 evaluation metrics corresponding to the S&B Foods Mission. Through our initiatives to achieve these targets, we will contribute to the resolution of social issues and progress toward achieving our vision.
Third Medium-Term Business Plan 
Our Sustainability Initiatives
The “Earth’s blessing” is at the core of the S&B Foods Group’s businesses. For us, sustainability initiatives mean nothing less than achieving harmony with society and the environment through business activities based on our philosophy, vision, and code of conduct.
The Sustainability Committee, a body under the direct control of the Board of Directors, plays a central role in establishing sustainability-related targets, monitoring our progress toward those targets, and evaluating achievement.
In April 2023, we also established the Human Rights Group within the Sustainability Committee to reinforce respect for human rights among all people associated with our businesses. The Human Rights Group promotes the establishment and operation of the S&B Foods Group’s human rights due diligence framework in coordination with the Sustainable Procurement Promotion Group as well as the Risk Management Committee and its subsidiary Compliance Group.
Regarding the procurement of ingredients, in June 2023, we revised the Sustainable Procurement Commitment established in May 2019, setting more aggressive targets for the transition to RSPO-certified palm oil and FSC-certified paper and expanding the scope of our main spices covered by the commitment.
During R&D and product development, we put ourselves in the customer’s shoes, ensuring that products are safe, reliable, and provide value, always keeping society, the environment, and human rights in mind. We will continue to strengthen our efforts for safety and reliability. These include the enhancement of our production history information management systems and the improvement of work quality at production sites.
Diversity management is one of our key business strategies, and we will focus on promoting “new work styles” and more diverse human resources across the organization. We will work to maintain our Platinum Kurumin certification, continue our Health & Productivity Management Outstanding Organization certification, and enhance employee engagement to create workplaces where diverse human resources can play an active part and experience a sense of fulfillment.
Based on the executive officer system, the roles of board members and executive officers are clarified on corporate governance matters in order to speed up the decision-making process and business operations. Continued efforts are also underway to improve the effectiveness of the Board of Directors while quickly and precisely adapting to changing business environments. We will work to enhance internal controls across the S&B Foods Group and continually strengthen our management systems, centered on the Risk Management Committee, to address the various risks associated with our business activities.
Aiming for Sustainable Growth and Higher Corporate Value
We will constantly evolve our core competence “Spice and Herb, the Earth’s Blessing,” aiming for sustainable growth through value recognized by customers and the provision of products that enhance our uniqueness.
No matter how the business environmental changes, our mission and vision remain unaltered: to live in harmony with “nature,” enrich “households,” and contribute to the “happiness” of people around the world. Through our initiatives under the Third Medium-Term Business Plan, we will fulfill our mission as a food manufacturer, continually provide new value, and create social and economic value.
I feel a strong sense of responsibility and fulfillment at the helm of the S&B Foods Group as it marks its 100th anniversary, and I will strive to ensure that I meet the expectations of all our stakeholders.
I look forward to your continued understanding and support.