Strengthening sustainability initiatives
to promote continued growth

Hiroshi Narita
President and Representative Director

The root of our business: The ideals of Shirota-ism

The Yakult Group’s desire to contribute to the health of people around the world has been handed down from Yakult founder Minoru Shirota and continues to guide our activities today. As a child, Dr. Shirota was saddened to see people suffering from infectious diseases and set his sights on becoming a researcher. He focused on microorganisms and discovered what came to be known as Lactobacillus casei strain Shirota,* which could reach the intestines alive and exert beneficial effects, and he developed the fermented milk drink Yakult. His efforts were directed toward preventive medicine, which aims to help people avoid sickness rather than treating diseases after they occur; he believed that “a healthy intestinal tract leads to a long life,” as humans absorb nutrients through the intestines; and he hoped to provide Lactobacillus casei strain Shirota to as many people as possible at “a price anyone can afford.” These ideas, known collectively as Shirota-ism, are part of a tradition at Yakult and are embraced by our overseas operations as well. Each day, 40 million of our dairy products are enjoyed by people in 40 countries and regions around the world, including Japan.
* Reclassified as Lacticaseibacillus paracasei strain Shirota in April 2020

Initiatives for each material theme

The Yakult Group has always sought to address the prevalent social issues of the day. We believe that the popularity of Yakult 1000 and Y1000 drinks is the result of our efforts to offer solutions to modern-day health concerns like stress and sleep. The continued growth of the Group hinges on being able to provide products and services that help address social issues and working to ensure the sustainability of society. In other words, we need to not only improve business performance but also strengthen our initiatives to ensure sustainability.

To achieve this, in fiscal 2020, the Group identified six material themes. Three are environmental themes, namely, climate change, plastic containers and packaging, and water; and the remaining three are social themes, specifically, innovation, value co-creation with communities and supply chain management.

To address environmental issues, we formulated the Yakult Basic Policy on the Environment in 1997. And in 2022, we established the Yakult Group’s Environmental Vision 2050, along with the medium-term Environmental Targets 2030 and the short-term Environmental Actions (2021–2024) as milestones to achieving the longer-term Vision. To address climate change, we are transitioning to a decarbonized society by reducing our greenhouse gas emissions through measures like the introduction of renewable energy.

The market growth of dairy products like Yakult 1000 inevitably leads to increased use of plastic, but we are committed to both improving business performance and reducing the environmental impact of plastic containers and packaging.

Water, meanwhile, is essential for us as a beverage manufacturer, and we are fully aware of its importance and of our responsibilities at a time of increasing global water scarcity and other issues. We thus practice sustainable water use and are addressing water risks on a region-by-region basis.

Even as we promote these initiatives, we are considering revising our current Environmental Targets 2030 in the light of the changes that have occurred since their establishment.

One of our society-related material themes is innovation. The continuity of our Group to this day is the result of timely innovations over the years. Our operations began with the discovery and commercialization of Lactobacillus casei strain Shirota, and we subsequently introduced a unique home delivery system and launched new, health-supporting products. Such innovations cannot be developed, of course, simply by sitting still; they are the products of a willingness to work tirelessly to achieve breakthroughs. At the same time, we must not be satisfied with past achievements and successes and become conservative in our thinking. We must be willing to review our business model, organization, supply chain and target markets, centered on food and beverage products. To meet the needs of a changing social environment, we must change at an even faster pace. Human resources who are aware of the challenges we face are the keys to promoting change and growth. The continued growth of our Group thus hinges on the innovation mindset of each management member, employee and Yakult Lady.

The continuity of the Group has been enabled by our community-based operations. Because we will need to keep working with local communities in the future, we have chosen value co-creation with communities as a second society-related material theme. Even now, we place importance on values like sincerity, harmonious human relations and kindness that were emphasized by Dr. Shirota. And we promote the health of people in the community through the delivery of products and health information and the communication efforts of Yakult Ladies. In addition to making home deliveries, we are engaged in such initiatives as community safety watch and crime prevention activities, sponsorship of events held in the community, and preserving the environment through tree-planting activities.

And because promoting sustainability requires addressing issues not only within the Group but also throughout the supply chain, we have identified supply chain management as another material theme. We endeavor to identify and rectify any environmental or human rights issues that may occur in our supply chain, and we give importance to strengthening dialogue with our suppliers to avoid becoming self-righteous.

Organizational measures to promote sustainability

The Environmental Promotion Department, established at the head office to spearhead efforts to achieve Environmental Vision 2050, plays a central role in coordinating Group-wide efforts, including with our overseas offices, and in collaborating with affiliated organizations outside the Group and with municipal governments.

Sustainability requires addressing not only environmental but also social issues, such as human rights, and is a topic that must be discussed at length by the Board of Directors. In 2024, we established the Sustainability Advisory Committee to deliberate on sustainability-related measures and responses and to offer recommendations to the Board of Directors. Through these and other measures, we will further strengthen the Board of Directors’ oversight of our sustainability initiatives.

In conclusion

For our next medium-term management plan covering the period from fiscal 2025, we are now examining business and nonfinancial strategies that will lead to sustainable corporate management.

We will continue to communicate with all members of society, as represented by our stakeholders, and do what we can and need to do to contribute to the sustainability of our business, of society and of the planet.

November 2024