ANNUAL REPORT 2023
Year Ended February 28, 2023

Onward Holdings Co., Ltd.

Contents

Environment

03 The Onward Groupʼs Raison Dʼetre

Message from
the Management

04 Message from the President
07 Message from Outside Director

SocialCorporate Governance

09 Value Creation Model of the Onward Group

FY02/23 Result

15
15
16
17

Environmental Initiatives
Environmentally Friendly Manufacturing
Circular Economy
Onward Group Disclosure in Line with the TCFD
Recommendations

20
20
20
21
22
23
24

Social Initiatives
Co-prosperity with Suppliers
Co-prosperity with Communities
Work Style Design
Diversity
Initiatives for Human Capital Management
Respecting Human Rights and Developing the Working
Environment
26 Stakeholder Engagement

28 Corporate Governance
32 Management Team

34 Consolidated Financial Results
35 Apparel Business
37 Lifestyle Business

10 Awareness of the Business Environment

Value Creation Model andSustainable Management

11 Strengths of the Onward Group12 Sustainability Vision and Promotion System
13 Materiality of the Onward Group

Forward- Looking Statements

ANNUAL REPORT 2023

Financial Data andCorporate Information

40 11-Year Key Financial Data
41 Analysis of Financial Position, Operating Results and CashFlows
43 Consolidated Financial Statements
47 Our History
49 Onward Group Key Brands
51 Our Network
52 Company Information
53 Stock Information

The information in this report is not a solicitation to purchase or sell Onward Holdings stock.
Opinions and forecasts stated herein represent the judgments of the Company at the time this report was published. Onward Holdings makes no guarantee regarding the accuracy of the information in thisreport and may make revisions without prior notice. Onward Holdings and the providers of this information assume no responsibility whatsoever for any losses incurred in association with this information.
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Message from the Management

Value Creation Model and Sustainable Management

Environment

Messages from the Management

ANNUAL REPORT 2023

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

The Onward Groupʼs Raison Dʼetre
Message from the President
Message from Outside Director

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

The Onward Groupʼs Raison Dʼetre(Mission Statement)

Enriching and Adding Color to Peopleʼs
Lives while Caring for the Planet
The world of today is plagued with various global environmental and social issues, and we are therefore pressed to take actions specifically for contributing to the realization of a sustainable society.
The Onward Group realizes that sustainable management is an important theme that forms thefoundation for its corporate activities. Accordingly, we will continue to practice management that
pursues coexistence with the global environment based on our mission statement of “enriching
and adding color to peopleʼs lives while caring for the planet.”

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Message from the President

We will pursue new growth strategies
based on the outcomes of our global
business reforms.
Return to Operating Profit in FY02/23 for First Time in Four Years
In the Groupʼs financial results for the year ended February28, 2023, net sales increased by ¥7,600
million from the previous fiscal year to ¥176,100 million, and a ¥6,300 million improvement in operating
profit/loss brought us back into profit of ¥5,200 million. The greatest factor in the increase in revenue
and profit was the recovery of the domestic apparel business, particularly Onward Kashiyama. In
addition to the outcomes of our global business reforms that began in FY02/20, thorough inventory
controls and discount sales reduction measures, among other factors, resulted in our gross profit
margin increasing by 2.9pt from 52.0% in FY02/22 to 54.9% in FY02/23. Selling, general andadministrative expense ratio also improved by 0.7pt from 52.7% to 52.0%. Thanks to these results,
profits at all levels returned to profitability.
Net profit for the fiscal year fell by ¥5,500 million year on year to ¥3,100 million, but this was due totemporary factors, namely the posting of a massive gain on sale of real estate in the previous fiscal year.

Turning Changes in the Business Environment into Growth Opportunities
The business environment surrounding the fashion business has been undergoing major structuralchanges since before the COVID-19 pandemic. Specifically, those changes include rising consumerawareness of global environmental issues and the advancement of digital transformation (DX).
Further, the COVID-19 pandemic that started in early 2020 had a devastating impact on the global
economy and peopleʼs lives. In Japan, however, since movement restrictions were lifted in 2022, theMichinobu Yasumoto

recovery trend in the flow of people has become more pronounced, and demand for fashion isrecovering.

President and CEO
Onward Holdings Co., Ltd.

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Message from the President<Diversification of Values>
Against the background of these changes in the economic environment, consumersʼ values and needs
are also becoming more diverse. We consider that this will lead to new growth opportunities for the
Onward Group.

with the proceeds used to fund sustainable initiatives.
This year, we will evolve the Onward Green Campaign in terms of both quantity and quality withthe launch of Upcycle Action, in which unneeded clothing items will be used to create new value.
Leveraging our creative abilities as a fashion company, we will create new items of value fromthose unwanted clothing items.

There are several key themes regarding this change in values. The first of these is “preference forhigher quality.”
As a result of changes in working styles as remote work became more prevalent during the
COVID-19 pandemic, peopleʼs needs have become more diverse. To take business suits as an example,
there is now a greater demand for more casual business items. Consequently, while customers
purchase fewer business suits, they are more likely to choose high-quality, more satisfying products,
even if they come with a higher price tag. This kind of preference for higher quality in consumer needs
is also evident in the significant growth in sales volumes in the Groupʼs major brands, particularly of
items in higher price ranges.
The second key theme is “customization.”
As part of our environmentally friendly manufacturing, the Onward Group is concentrating its efforts on
the made-to-order business that eliminate wasteful inventories. Demand for made-to-ordermerchandise, which can be customized to fit the individual customerʼs body shape and preferences
precisely, has become more prominent not only in menswear, but also in the womenʼs business suitmarket. Partly because of womenʼs further advancement in society, we see potential for this area togrow into a significant market.
The Onward Group hopes to respond to the growth in demand for this kind of high-quality fashionin the most appropriate way, leveraging the comprehensive capabilities that we have cultivated since
our foundation. These include our capabilities in planning, development, and expertise in manufacturing
merchandise of high quality, as well as the customer service skills of our sales personnel.
The third key theme is “sustainable.”
Amid growing consumer awareness of global environmental issues, one critical theme supporting thebusiness foundation of the Group is sustainable management initiatives.
In the Onward Green Campaign launched in 2009, we are promoting an apparel circulation system
in which we collect used Onward Group apparel items from customers so that they can be reused or
recycled to the greatest degree possible. Collected clothing items are recycled into blankets, work
gloves, and solid fuel, with the blankets provided to disaster-affected areas in Japan and abroad and todeveloping countries in cooperation with the Japanese Red Cross Society. In addition, collected clothing
items that are in good condition are cleaned and sold at Onward Reuse Park in Kichijoji, Tokyo, which is
our concept store to communicate the Groupʼs environmental initiatives, and online at charity prices,
ANNUAL REPORT 2023

<Digital Transformation (DX)>As I mentioned earlier, when customers were forced to stay home during the pandemic, demand foronline shopping surged, resulting in the expansion of net sales from e-commerce. Further advances arealso being made in digital transformation, including the use of generative AI.
In the Onward Group, we are seeing progress in the penetration of Onward Kashiyamaʼs Click &Try OMO service, where almost all ONWARD brand items offered on the official online store, ONWARD
CROSSET, can be delivered to a store to be tried on and purchased.
Prior to the launch of Click & Try service, customers would often visit our stores, only to find theitem they wanted to be out of stock, and they had to give up on the purchase. The Click & Try service
was introduced to allow customers to actually pick up and try on at physical stores almost all items
posted on ONWARD CROSSET. Customers can select the products that they are interested in online andhave them delivered to their designated store. By actually trying the items on at store andcommunicating with the sales personnel, customers can enjoy a quality fashion buying experience. Thisand other benefits for the customers have been well received, and there has been a sharp expansion in
the use of this service.
As of May 31, 2023, Click & Try has been introduced to over half of our Onward Kashiyama stores(360 stores), and we have plans to further increase the number of stores introducing the service going
forward.
Another area that the Group is focusing its efforts on alongside Click & Try service is the roll-out of ourmulti-brand stores, ONWARD CROSSET SELECT. The Onward Groupʼs fundamental policy was to rollout physical stores on a brand-by-brand basis. ONWARD CROSSET SELECT, however, stocks
merchandise across several different brands, including Nijyusanku, Jiyuku, and ICB. With such a wide
range of items available, customers can experience and purchase diverse clothing coordination.
We first started rolling out ONWARD CROSSET SELECT stores in 2021. As the sales personnel has
developed a full understanding of their benefits, namely improved customer convenience and thebroader range of suggestions that personnel can offer to customers, and actively engaged in their task,
sales have trended at higher levels than we initially envisaged.
Going forward, we intend to expand ONWARD CROSSET SELECT stores to department stores andshopping centers all over Japan.
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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Message from the President
Overseas BusinessThis marks the third year since the start of ONWARD VISION 2030, and in those three years, amid
the COVID-19 pandemic, we have emphasized the promotion of global business reforms, positioning
this period as one of building the foundations for medium- to long-term growth.
We plan to present our full-scale growth strategies for FY02/25 and beyond in the revised
version of ONWARD VISION 2030 to be announced in April 2024. A key pillar of those strategies willbe the rebuilding of our global strategy.
The Group has been focusing its efforts on the reforms of the overseas business, including
withdrawal from unprofitable businesses. Because the end is finally in sight for these reforms, what
we intend to do next is build a strategy for growth in overseas markets.

To Our Stakeholders
In the four years from FY02/20, when we started our global business reforms, to FY02/23, we haveproduced very unfortunate financial results, partly due to the major impact of COVID-19. However,the various measures aimed at future growth that we have implemented in that time are now
showing their effects in earnest.
For this reason, our forecasts for FY02/24 are net sales of ￥188,800 million, a year-on-year

M&A Strategy
In April 2021, the Onward Group formulated ONWARD VISION 2030, our medium- to long-term
management vision, with FY02/31 as the final year. In ONWARD VISION 2030, our plans for FY02/31
are net sales of ¥300,000 million and operating profit of ¥25,000 million yen. The apparel businessis expected to account for ¥200,000 million of those net sales and ¥10,000 million of operating
profits, with ¥100,000 million of net sales and ¥15,000 million of operating profits coming from thelifestyle business.
The lifestyle business segment consists primarily of four companies: Chacott in the wellness
business, Creative Yoko in the pet & home life business, Yamato in the gift business, and KOKOBUY
in the beauty and cosmetic business. All of these companies performed strongly during the
pandemic, and we are eyeing M&As to accelerate the growth of the lifestyle business segment.
However, these M&As are not merely intended to expand the scale of the business. Their premise isincrease of ¥12,700 million, and operating profit of ¥10,000 million, a year-on-year increase of¥4,800 million. We are also planning a dividend per share of ¥16, up ¥4 from the previous fiscal
year.
In this way, having transformed into a lean management structure through global businessreforms, the Onward Group will now accelerate its growth in earnest toward the realization of
ONWARD VISION 2030.
Lastly, the entire Group will continue to do its best to achieve further expansion of our financial
results and enhancement of corporate value, so that we may meet the expectations of ourshareholders, investors, and other stakeholders. I ask for your continued support.

that we can expect them to generate synergies in product development and human resources in theareas sales knowhow between businesses within the lifestyle business segment, they have anaffinity with the apparel business, and they handle special products of high quality.

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Message from Outside Director

I will work to further promote the Work Style Design initiative
Companies winning competition for talent will thrive
Since establishing Work-Life Balance Co., Ltd. in 2006, I have been involved in workstyle reform consultations for approximately 3,000 companies. I have also
served as a member on councils and other bodies on productivity improvement, work-life balance, childcare support, and diversity, for the Ministry of Health,Labour and Welfare, Cabinet Office, Ministry of Economy, Trade and Industry, and other organizations, and have made policy recommendations.
I was appointed as an Outside Director of Onward Holdings in 2019, and I strive to reflect the knowledge that I have gained through my experiences
to date in discussions in the Board of Directors.
Specifically, as Japanʼs social structure has already transitioned from a demographic bonus (period of labor surplus) to a demographic onus (aperiod in which labor shortages pose a barrier to economic development), we have had discussions within the Company about sharing the awarenessthat only companies that successfully compete for talent through proactive investment in human capital are able to grow.
Against this kind of social background, childcare leave for male employees, the empowerment of female employees, and workstyle reforms are not initiatives to beaddressed for compliance reasons; instead, they are essential management strategies to win that competition for talent. Going forward, management will be evaluated more
severely from the perspective of strengthening of human capital. The Japanese government has set a target for companies listed on the prime market of the Tokyo Stock
Exchange to raise the ratio of female executives to 30% or more by 2030. As there are still many managers in the Company who experienced success by working longhours during the demographic bonus period, simply increasing the number of female executives will not truly constitute human capital management.
It is important to transform work styles so that both male and female employees are able to take on responsible work while raising children or
caring for elderly family members. To this end, in 2019, the Onward Group launched the Work Style Design Project, which encourages employees to takethe initiative voluntarily in changing the way they work, with the aim of improving productivity by enhancing operational efficiency and achieving work-lifebalance. Going forward, I intend to promote this project even further.
In addition, while the ratio of female managers of the Company has improved, I also hope to contribute to the enhancement of initiatives for thedevelopment of female executive candidates.

A Board of Directors that speedily responds to emergencies
Four years have passed since I was appointed as an Outside Director, and having attended Board of Directors meetings throughout that period, my
impressions are that its members come from diverse backgrounds and that it is poised to exchange active opinions, as well as to make bold decisions.
As the COVID-19 pandemic started the year after my appointment, external factors forced us to address the issue of workstyle reform. At that time,
the Company was quick to hold Board of Directors meetings online with a sense of speed, so that the Board could make important decisions swiftly.
Moreover, the Company has established a management structure that enables instructions to be communicated to the frontlines without delay attimes of disaster such as earthquakes. In my view, this is highly commendable from a perspective of business continuity plan (BCP).
I believe that, if it is to respond to increasingly diversifying customer values and needs and contribute to society, it is important that the Onward
Group places even more effort into putting the Groupʼs Raison Dʼetre of “Enriching and Adding Color to Peopleʼs Lives while Caring for the Planet” into
practice, which is based on the philosophy of sustainable management that cherishes enriching and adding color to the global environment, layered overthe management philosophy it has had since its foundation. I aim to contribute to Onward Holdingʼs evolution into a company where diverse and uniquepersonnel can exhibit their strengths, on which that Raison Dʼetre is premised.
ANNUAL REPORT 2023

Yoshie Komuro
Outside Director (Independent Director)
Career summary
Apr. 1999
Jul. 2006
Apr. 2008
Oct. 2009
Apr. 2013
Sep. 2014
Feb. 2015
Jun. 2017
May 2019
Apr. 2020
Nov. 2020
Dec. 2020
Jun. 2022

Joined Shiseido Company, Limited
President of Work-Life Balance Co., Ltd.
(current position)
Member of the Evaluation Working Group,
Work-Life Balance Promotion and
Evaluation Council, Cabinet Office
Visiting Professor of Kanazawa Institute ofTechnology Graduate School (current
position)
Member of the Children and Childcare
Support Council, Cabinet Office
Civil Member of the Industrial
Competitiveness Council
Member of the Central Council for
Education, Ministry of Education, Culture,
Sports, Science and Technology
Outside Director of JAPAN POST
INSURANCE Co., Ltd.
Outside Director of the Company (current
position)
Outside Director of redfox, inc.
Outside Director of ClipLine, Inc. (current
position)
Director (Outside) of PACIFIC CONSULTANTS
CO., LTD.
Outside Director of LITALICO Inc. (current
position)

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Value Creation Model of the Onward Group

Value Creation Model andSustainable Management

Awareness of the Business Environment
Strengths of the Onward Group
Sustainability Vision and Promotion System
Materiality of the Onward GroupANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Value Creation Model of the Onward GroupThe Onward Groupʼs Raison Dʼetre (Mission Statement)“Enriching and Adding Color to Peopleʼs Lives while Caring for the Planet”

Sustainability Vision

Sustainable Management
Material Issues (Materiality)

Management Capital(As of the end of February 2023)
Financial Capital

Environmental changes

Total assets¥159.2 billion
Net assets¥85.1 billion
Shareholdersʼ equity ratio
47.0％

Diversification ofpeopleʼs values

Business Capital

Customer behavior in pursuitof “individuality”
Pursue satisfaction not only
in fashion, but lifestyle ingeneralExpand brands tomeet a diverse rangeof customer needs

Sustainability in theapparel industry
Shift from the model of massproduction and massconsumption
Expand long-life design andsecondary distribution
Expanding demand forsustainable fashion

Expanding customer
base interested insustainable fashion

ANNUAL REPORT 2023

Number of group companies (including
the Company)
51 companies
Apparel Business
30 companies
Lifestyle Business20 companies

Materiality 1
Business activities thatenable coexistence with theglobal environment andilluminate a path to the future

Materiality 2

Materiality 3

Materiality 4

Materiality 5

Growing together withpartners

Workstyles that enhance andadd color to employeesʼ
lifestyle as well

Workplace where diverse
individuals are engaged

Fair management withintegrity

Co-creation of Value with Customers
Through direct and two-way communication between
customers and Group employees, we will evolve into acustomer-centric company, making the best use of
employeesʼ diverse personalities

ONWARD VISION 2030
Five Strategies
Transform the Business Model of the ApparelBusiness Segment
Accelerate Growth of the Lifestyle Business Segment
Strengthen Business-to-Business Operations

Intellectual Capital
Trademark rights
Patents
Development of OMO stores
Digitalization of the supply chain

Evolve into a Company Where Diverse andUnique Personnel Can Exhibit Their Strengths

Customers

Promote Sustainable Management That Pursues
Coexistence with the Global Environment

Human Capital
Number of group employees
6,061
Promoting the activities of diverse
personnel
Diversification of workstyles
Ratio of female employees
79.3％
Ratio of female managers(section manager and above) 28.1％
Social Capital
Improvement of traceability
Initiatives to address human rights
issues at production sites

Business Model
Value
Co-creation

We will grow the Lifestyle Business segment as
another core business of the Group, alongside theApparel Business segment
ApparelBusiness
Segment

Onward Group

Human
Resources

LifestyleBusiness
Segment

Enriching andadding color topeopleʼs lives
while caring forthe planet
through theuniversal
language offashionGroup Platforms (Systems)
Product planning, production, and distribution

Natural Capital
Initiatives to reduce CO2 emissions at
production sites
Initiatives to recover and reuseproducts
Recovered approximately 6.87 million
items of clothing (cumulative total
from FY02/10 to FY02/23)
Eliminate wasteful production

Management/Administration/Finance
Sales

ONWARD CROSSET and OMO stores

Organization and HR
MarketingOnward Members

Corporate Governance
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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Awareness of the Business Environment

Customersʼ values and needs are definitely changing as we enter the post-COVID-19 era.
Seizing change as an opportunity, we are aiming for sustainable growth through strategies that leverage
our Groupʼs strengths.
Environmental changes
Diversification of peopleʼs values

Image of our post-COVID-19 growth strategy

Corresponding strengths

Themes to focus on

Customer behavior in pursuit of “individuality”

Expanding customer contact points

Pursue satisfaction not only in fashion, but lifestyle in general

Maintain existing customer base and expand toyounger customers
Brand value

Expand brands to meet a diverse range of customer needs

Maximizing lifetime value
Proposals for general lifestyle demand, transcending
apparelHigh quality

Sustainability in the apparel industry

Appealing with prices that match quality

Shift from the model of mass-production and mass-consumption
Expand long-life design and secondary distribution
Expanding demand for sustainable fashion

Personnel(Planning skills,
customer service skills)

Further strengthen product appeal to satisfy customers
Focus on full-price sales

Sustainable management
Strengthen sustainable brands/products

Expanding customer base interested in sustainable fashion
Sustainability

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Strengths of the Onward Group

Drawing on the strengths of our Group centered on human resources, we will achieve
our ʻdesired imageʼ through the co-creation of value with customers.
Source of Value Creation of the Onward Group
Diverse range of personnel■ Creators with personality

Consistently creating value, from planning up to
design, production, and sales
Design skills for competing as a teamCo-creation of Value with Customers
Diverse range of brand values in the apparel businessHigh quality standard
business

Unique value business

Neo-business modelbusinesses■ High-quality sales personnel

Proposing products that suit customersʼ lifestyles

Customer base of 4.8 million■ “ONWARD CROSSET”

Promoting OMO strategy that allows customers to go
back and forth between our physical and online stores,
and touch online store merchandise at our physical stores
Improving quality and service with courteous
responses unique to physical stores and timely online
feedback

Production systems for achieving high quality,
innovation, and sustainability■ Achieving high quality through domestic production

Combining the high technical capabilities of skilledworkers with the latest digital technologies in the
product manufacturing process■ Smart factories

Introduction of IoT systems to increase efficiency fromorders to production and delivery, and to achieve leanmanufacturing

ANNUAL REPORT 2023

Expansionofsituations

Lifestyle businesses fordiverse situations■ Provision of value for different lifestyles

Creating new value and lifestyles in different fields
while leveraging our product development and sales
capabilities
Showed strong performance during the pandemic
and is expected to grow as a core business in the
post-COVID-19 era

Business-to-business (B2B) operations■ Achieving stable business growth

In addition to the uniform business, we launched thenew platform service business to develop OEM andODM businesses, opening up smart factory
functionality to external parties

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Sustainability Vision and Promotion System

Sustainability Vision

Sustainability Promotion System

Enriching and adding color to peopleʼs lives
while caring for the planet, the Onward
Group reaches out to future generations
through the universal language of fashion.

Sustainability Committee
The Onward Group has established the Sustainability Committee,
headed by the President and CEO of Onward Holdings. This
Committee, whose members include the presidents and personnel
responsible for sustainability of Onward Group companies,
discusses and decides on sustainability risks and opportunities.

The Onward Group Sustainability Committee
Organizational Structure

The Onward Group established the Sustainability Committee
in September 2021 to promote sustainability initiatives. Since
then, this Committee has taken the lead in the formulation ofBoard of Directors

a concrete action plan and KPIs (key performance indicators).
We will promote sustainable management in our aim to
Sustainability Committeeenrich and add color to peopleʼs lives while caring for theplanet, as we reach out to future generations through the

Chairman:Committee Members:

universal language of fashion.

Promote Sustainable Management That
Pursues Coexistence with the Global
Environment
The Onward Group has been promoting recovery, recycling, andreuse of its products through the Onward Green Campaign forover 10 years. We are also working actively to expand the scopeof the made-to-order business that eliminates wasteful production.
From the viewpoint of improving traceability, the Japan Apparel
Quality Center (JAQC), a general incorporated association in the
Onward Group, conducts factory audits in Japan and overseas.
By embracing new challenges while stepping up these
initiatives, we are promoting sustainable management that
pursues coexistence with the global environment.

ANNUAL REPORT 2023

Evolve into a Company Where Diverse andUnique Personnel Can Exhibit Their Strengths
The Onward Group realizes that in order to respond to diversifying
customer values and needs and contribute to society, the Onward
Group must be an enterprise where diverse and unique personnel
are encouraged to exhibit their strengths. By promoting ourworkstyle reform project and enriching various personnel
systems, we are endeavoring to cultivate a workplaceenvironment where diverse employees can flourish and create
work-life synergy.

President and CEO
Presidents and personnel responsible
for sustainability of Onward Group
companies

Communicate
policies andshare them

ReportGeneral Meeting of Sustainability Committee
Members of the Sustainability Committee andexecutives responsible for core divisions
participate and discuss the medium- to long-termsustainability plan and its promotion system
Monitor the progress of the annual plan for
ESG issues aligned with the materiality andrevise as necessaryGroup companies, operating divisions, administrative divisions
Set targets for the issues, implement measures, andmanage progress

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Materiality of the Onward Group
Materiality 1
Business activities thatenable coexistence with theglobal environment andilluminate a path to the
futureFive Material Issues
The Onward Group identified five material issues (materiality) in accordance with the mission
statement, “Enriching and adding color to peopleʼs lives while caring for the planet.”

Materiality 2

Materiality 5

The Group is promoting sustainable management that pursues coexistence with the global
environment by identifying “1. Business activities that enable coexistence with the global environment

Fair managementwith integrity

and illuminate a path to the future ” and “2. Growing together with partners” as material issues related
to the Groupʼs business activities, including manufacturing.
“3. Workstyles that enhance and add color to employeesʼ lifestyle as well” and “4. Workplace
where diverse individuals are engaged” are identified as material issues concerning our earnest

desire to be an enterprise where diverse and unique personnel can exhibit their strengths. We are
pursuing workstyle reform initiatives and cultivating a working environment where diverse employees
can flourish.
From the viewpoint of corporate governance, we identified “5. Fair management with integrity” as

Enriching and addingcolor to peopleʼs lives while
caring for the planet, theOnward Group reaches out
to future generations
through the universal
language of fashion.

Growing together
with partners

Materiality 3
Materiality 4
Workplace where diverse
individuals are engaged

a material issue and are striving to cultivate a corporate culture supporting the Onward Groupʼsconcerted efforts to be an indispensable enterprise earning the trust of society.

Workstyles thatenhance and add color
to employees ʼ lifestyle
as well

Materiality Identification Process

1

Identification and organizing of(environmental, social, andeconomic) issues Longlisting

Referring to the GRI (Global Reporting
Initiative) Standards, the SASB (Sustainability
Accounting Standards Board) Standards, SDGs,
and evaluation items of ESG rating agencies,
we identified 63 items concerning thoseenvironmental, social, and economic issues
that are considered to have major impacts.

ANNUAL REPORT 2023

2

Prioritization of issues
and check of validity

We identified and organized the customersʼ andother stakeholdersʼ expectations toward the
Onward Group and priority issues to beaddressed, as well as the impacts on them.
Reflecting the opinions of external experts, andthose responsible for various divisions of the
Onward Group, we selected 17 items concerning
the issues and checked their validity.

3

Identification of material issues
constituting the core of corporate
activities at executive meetings

Through discussion at the Sustainability
Committee chaired by the President and CEO of
Onward Holdings and with external experts, fivematerial issues were identified.

4

Formulation of action plans andsetting of quantitative targets
Proactive engagement

We are formulating action plans in accordancewith the Groupʼs material issues and setting
medium- to long-term quantitative targets.
Through proactive engagement in acollaborative endeavor with stakeholders, we
intend to achieve these targets.

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Environmental Initiatives

E nv iro n me nt

Environmentally Friendly Manufacturing
Circular Economy
Onward Group Disclosure in Line with the TCFD Recommendations

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Environmental Initiatives
We aim to contribute to the realization of a low-carbon, recycling-based society in order to pass on a rich and vivid planet to future generations.
Environmentally Friendly Manufacturing
The Onward Group is promoting manufacturing and the online merges with offline-style services, or
OMO services that achieve both environmental friendliness and enhanced customer satisfaction andconvenience. Our initiatives include expansion of made-to-order production, efficient merchandising by
integrating inventory data from both physical stores and e-commerce to ensure smoother two-way
transfer of products, achievement of appropriate production volumes, and development of sustainableproducts.

High-Efficiency Distribution System• In our made-to-order businesses, we take wasteful warehouses out of the equation and deliverproducts directly from factories to customers.
• We use PACK-RUNNER compressed and sealed packages to help substantially save space inlogistics vehicles.
• We use paper delivery packages for suits to ensure environmentally conscious and compact
packaging.

PACK-RUNNER■ Smart Factory Kashiyama Dalian (KASHIYAMA, a made-to-order suits brand)

Drastic Reforms to All Manufacturing Processes to Eliminate Wasteful Production• Smart factories link data from orders with computer-aided manufacturing processes and use
automatic cutting machines to cut cloth more precisely and thereby reduce the portions of cloththat cannot be used. In addition, these factories utilize automatic ordering systems for incidental
items (buttons, lining, etc.) to ensure appropriate inventory levels.
• We manage products with radio frequency identification (RFID)* tags and hanger systems while using
tablets for process management to swiftly produce items customized based on customersʼ requests.
*RFID is an automatic recognition technology that uses radio waves to read and write information on IC tags without contact.

ANNUAL REPORT 2023

Paper delivery package

Environmentally conscious, compact
package

Integration of Inventory Data Encompassing Physical Stores, E-commerce, andWarehouses
Physical stores provide opportunities to try on items andcustomer services, while e-commerce offers its advantages
such as a rich selection of products. Through OMO stores
offering the services of both, we are providing venues
where customers can enjoy the maximum benefits of both
services.
In addition to the gradual expansion of OMO storeswith Click & Try service, where almost all items on our
online store can be delivered to a store to be tried on andpurchased, we will also promote the steady roll-out anddevelopment of ONWARD CROSSET SELECT stores. These are multi-brand stores with sustainability
functions including the support of the Onward Green Campaign, through which we collect used Onward
Group apparel items from customers so that they can be reused or recycled to the greatest degree
possible. In addition, repair and maintenance services are available at some of the ONWARD CROSSET
SELECT stores.

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Circular Economy
In addition to promoting environmentally friendly manufacturing, we will promote recovery, recycling, and reuse of our products while also steppingup the reduction and recycling of plastic waste, in order to realize a recycling-based society (circular economy).
■ Onward Green Campaign Designed to Establish an Apparel Circulation System
Onward Kashiyama launched the Onward Green Campaign in 2009 with the objective of encouraging
the circulation of apparel to promote the efficient utilization of limited resources and to ensure our
precious environment still exists for future generations to enjoy. Through this campaign, we promote
an apparel circulation system in which we collect used Onward Group apparel items from customers sothat they can be reused or recycled to the greatest degree possible.
Collected clothing items are recycled to produce RPF, blankets, work gloves, and other items. The
blankets are provided to disaster-affected areas in Japan and abroad and to developing countries incooperation with the Japanese Red Cross Society. Work gloves are distributed for various purposes,
such as for disaster relief, forest preservation, and awareness-raising activities. In addition, collectedclothing items that are in good condition will be cleaned and sold at Onward Reuse Park, which is ourconcept store to communicate the Groupʼs environmental initiatives, and online at charity prices withthe proceeds used to fund sustainable initiatives.
By FY02/23, a total of approximately 1.32 million customers have donated approximately 6.87
million items of clothing, of which we recycled 82% and reused 18%.

Onward Corporate Design Co., Ltd. (former Onward Trading Co., Ltd.) and ANA HOLDINGS INC. areworking together on a joint project that brings together their Onward Trading Re-make-up Project and
ANA Future Promise project. For the first project, the two companies have jointly developed the “ANA
Special Slippers” as an upcycling initiative, in which each pair of slippers is made by hand using
airplane seat covers that are subject to disposal. The products were sold on the ANA Up-cycle Project
Shop via pre-order lottery sales. Being an idea of an employee of Onward Trading in the first place, thisinitiative has been launched as a new business that aims to solve the large-scale disposal issue ofclothes in the apparel industry. Each pair is handmade by craftsmen in Kahoku Town, Yamagata
Prefecture, Japanʼs largest production site of slippers. As a result, this initiative also contributes toregional development through revitalizing traditional industries.

Customer Feedback
This eco-friendly initiative is really impressive.
I entered the lottery to show my support for this fantastic project.
I think this is an excellent project in an era in which the importance of sustainability isemphasized.
I greatly value this project for effective use of materials we used to throw out from anenvironmental protection standpoint.
Itʼs great to reuse jumble in a different shape rather than just throwing away. I look forward to
wonderful projects like this in the future!

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Onward Group Disclosure in Line with the TCFD Recommendations
The Onward Group realizes that sustainable management is an important theme that forms the foundation for its corporate activities. Accordingly, we are practicing managementthat pursues coexistence with the global environment based on our mission statement of “enriching and adding color to peopleʼs lives while caring for the planet.” Recognizingthat environmental issues, particularly climate change, have become increasingly serious around the world in recent years, they are top priority in the Groupʼs business activities,
and in 2022 we endorsed the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD).
We will continue to proactively address climate change and disclose information in order to coexist with the earth and promote business activities that are connected with the future.
■ Governance
The Group has established the Sustainability Committee, headed by the President and CEO of Onward
Holdings, to promote concrete sustainability initiatives in 2021.
The Committee, whose members include the presidents and personnel responsible forsustainability of Onward Group companies, promotes information-sharing and progress management
on climate change issues across the entire group.
Sustainability Committee*Total of domestic consolidated group companies
FY02/20

FY02/21

FY02/22

FY02/23

Change from FY02/20 to FY02/23

GHG emissions GHG emissions GHG emissions GHG emissions(t-CO2)(t-CO2)(t-CO2)(t-CO2)

Reduction(t-CO2)

Change (%)

Scope 1 Emissions from fuel use

2,187

1,182

1,553

1,233

-954

56.4%

Adjusted emissions fromelectricity use

11,547

9,841

8,895

6,352

-5,19555.0%

Scope 3 activities other than Scope

230,687

171,920

177,123

181,250-49,437

78.6%

Total greenhouse gas emissions

244,421

182,943

187,571

188,835-55,586

77.3%

P12

■ Risk Management
Climate change problem poses various risks to the Group, but we believe that managing these risks inadvance and responding appropriately to them will also provide opportunities for sustainable growth inour business activities.
The Sustainability Committee takes the lead in analyzing in detail how climate change affects ourbusiness activities, sharing risks with each group company, and considering and promoting initiatives.
■ Strategy
The Group identifies the risks and opportunities that climate change poses to its business activities andconducts scenario analyses of how to respond to these risks and opportunities. Referring to therecommendations of the International Energy Agency (IEA) and the Intergovernmental Panel on Climate
Change (IPCC), the scenario analysis assumed two worlds: one in which the world steadily implements
climate change measures and a temperature rise is limited to less than 2°
C, and the other in which
temperatures rise 4°
C or more due to insufficient measures.
Using 2030 as a baseline, we analyzed the impact of policies, regulations, technologies, markets,and reputations on business in the process of achieving this in the below 2°
C scenario, and the impactof acute and chronic changes in weather conditions and disasters associated with rising temperaturesin the 4°
C scenario.
■ Indicators and Targets
As part of our efforts to address climate change, we monitor greenhouse gas emissions (Scope 1, 2, and
3) and promote actions to reduce greenhouse gas emissions in conjunction with each group company,
led by the Sustainability Committee.

ANNUAL REPORT 2023

Changes in Onward Group greenhouse gas emissions from FY/ to FY/

Scope 2Emissions from business1 and 2

*Refer to the Ministry of the Environmentʼs Emission Intensity Database (Ver. 3.2) for calculating greenhouse gas emissions, etc.
of organizations through their supply chains.
*Cat 3, 8, 9, 10, 11, 13, 14, and 15, which are not related to business activities, are excluded from the calculation.

Onward Group greenhouse gas emission reduction target (compared with FY/)*Total of domestic consolidated group companies

FY2030 Scope 1 and 2
FY2030 Scope 3
FY2050 Scope 1 and 2: 50% reduction: 20% reduction: Aiming to reduce the real value to 0

The Onward Group has identified the promotion of sustainable management that
pursues coexistence with the global environment as an important theme of its mediumto long-term management vision “ONWARD VISION 2030,” which was disclosed in 2021.
We aim to contribute to the realization of a low-carbon, recycling-based society in order to pass on a richand vivid planet to future generations.
We will promote manufacturing that is friendly to the earth, expand made-to-order production, andconduct sustainable procurement of materials.
Aiming to realize a circular economy, we will promote collection, recycling, and reuse of products,
and actively work to reduce and recycle plastic waste.
Each of us will actively take action to mitigate climate change and promote business activities that
pursues coexistence with the global environment.
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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Onward Group Disclosure in Line with the TCFD Recommendations
Scenario Analysis in Line with the TCFD Framework
Business
impactOnward Groupʼs risks and opportunities
Risk and opportunity
classification

Countermeasures

Factor
Risk

Less
than
2℃

Opportunity

4℃

・Reducing GHG emissions by promoting

sustainable management

・Introduction of energy-saving equipment (LEDs,
・Introduction of carbon tax (carbon

Migration
risk・More investors are caring about

・Increased costs due to the introduction ofrenewable energy
・Increased logistics costs due to stronger GHG
emissions controls
・Decrease in sales of plastic products

introduction of new technologies

・Progress in improving the efficiency of logistics

・Increasing demand for recycled plastic products
・Reduction of inventories through appropriate

production
・Creating new businesses through increased
collection of clothing・Negative impact on investments and loans due to ・Strengthen management structure by
・Increasing demand for environmentally conscious

environmentally conscious product/brands

Marketconscious products and services
・Growing interest in the circular
economy・Increase in natural disasters due toPhysical
risk

Acute
Chronic

climate change
・Sea level rise and changes in rainfall
due to climate change
・Average temperature increase due toclimate change

・Expanding the 3Rs (reduce, reuse, and recycle) of⬆

bases in preparation for disasters

・Increasing demand for disaster prevention andprotective apparel・Formulation of disaster-prevention manuals andreinforcement of supply chain coordination

・Increasing demand for climate change-responsive ・Strengthening climate change-responsive

products and services

products and services
・Expansion of product lines using functional
materials

The impact on the Onward Groupʼs business is expected to be significantly large
The impact on the Onward Groupʼs business is expected to be rather large
The impact on the Onward Groupʼs business is expected to be immaterial

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⬆

⬆

The impact on the business is shown in three levels (the slope of thearrow represents the trajectory).

ANNUAL REPORT 2023⬆

・Establishing a system to disperse production

・Damage due to suspension of store operation andstore closures due to natural disasters
・Rising raw material costs due to bad weather
・Disruption of production plants and distribution
routes due to natural disasters
・Decrease in demand for products other thanclimate change-responsive products➡

・Expansion of environmentally conscious products

and brands
other than environmentally conscious products
clothing recycling for a circular economy
・Expand collection of clothing through the Onward
Green Campaign
・Refraining from buying due to growing awareness ・Creating services in response to the circularof circular economy
economy・Strengthen proposals for new services (3R/・Increasing demand for high-value-added products upcycle, etc.)that can be worn for a long time・Decreased willingness to purchase products⬆

・Strengthening the dissemination of sustainable

management
・Ensure appropriate and timely disclosure ofdemand for products and services
products and services
information
・Impacts on corporate image and human resource ・Enhancing corporate image and securing human・Thorough plant audits and quality control
recruitment due to inadequate response
resources through sustainable management
・Changes in consumer preferences and reduced

・Improve profitability through development of・Sympathy with environmentally

expanding bulk distribution
・Switching to and development of products using
recycled plastics
・Manufacturing without waste by strengthening
make-to-order production
・Expand collection of clothing through the Onward
Green Campaign⬆

incorporating ESG investments

・Increasing the efficiency of transportation by⬆

a decline in ESG ratings

government and industry groups

・Phasing in of renewable energy⬆

sustainable management
・Stricter disclosure of sustainable
Reputation
indicators
・Increasing demand for solutions toenvironmental and social issues

・Reduced profit due to carbon tax (carbon pricing)etc.) at stores and business sites

・Strengthening measures in cooperation with⬆

pricing)・Fines for failure to respond to climate
PolicychangeRegulation
・Expanded use of renewable energy
Technology
・Stricter plastic regulations
・Introduction of clothing recycling law
and waste disposal law

・Reduction of energy consumption through➡
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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Social Initiatives
Co-prosperity with Suppliers
Co-prosperity with Communities

SocialWork Style Design
Diversity
Initiatives for Human Capital Management
Respecting Human Rights and Developing the Working Environment
Stakeholder Engagement

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Social Initiatives
We cultivate long-term relationships rooted in trust with suppliers, local communities and other partners, emphasizing coexistence with them and the
pursuit of mutually beneficial growth.
Each one of us will comply with the Onward Group Guidelines for Action and conduct ethical business activities. We emphasize ensuring human rights and occupational safety andhealth throughout the supply chain in Japan and overseas, sharing values with our business partners. Moreover, through co-creation of value with communities and social
contribution activities, we aim to be an enterprise that grows together with them.

Co-prosperity with Suppliers

Co-prosperity with Communities

At the Onward Group, we sharevalues with our business
partners in the supply chain.
We aim to establish long-term
relationships rooted in trustwith our business partners andaspire to be an enterprise thatcan grow together with them.

■ Supporting Japanese Manufacturing
Onward Digital Lab Co., Ltd., which is responsible for the Groupʼs digital strategies, promotes CRAHUG, aninitiative launched in 2021 to support factories and producers across Japan on sales and branding.
In this project, we provide sales support through two collaborative plans: a sales collaboration planthat supports sales and promotion of existing products on the Groupʼs official online store ONWARD
CROSSET; and a branding plan that supports partners on new product development for their original
brands. The number of participating factories has risen to 44.

■ Factory Audits Through the Japan Apparel Quality Center (JAQC)
The Onward Group operates the Japan Apparel Quality Center to enable other companies and organizationsin the apparel fashion industry to utilize the expertise and insights on quality control that the Onward Grouphas cultivated over the years. Since its establishment in 2017, JAQC has been offering services, such as
factory audits, QMD*, testing & analysis, and repair, to companies inside and outside the Onward Group.
Through factory audits, we aim to foster companies that earn the trust of society and achieve
production systems that ensure the stable delivery of high-value-added products to customers. Deficiencies
in CSR and QC systems at our production factories are not only subject to criticism in society, but also major
obstacles to the sustainable operation of factories which are our suppliers. As such, we perform audits
employing the CSR audit guidelines based on global standards as well as our own proprietary quality
control audit guidelines.
Following the audits, certificates of compliance are issued to factories that meet the prescribedstandards. However, CSR audits should not be a means of terminating transactions with factories that do
not satisfy the standards. Rather, we think it is the social responsibility of the Group as a brand holder topoint out problems and help factory management understand the significance of the issues, and provide
support for improvement. As such, JAQC staff explain the purpose of the audit and the reasons for therequirements to the management of the factory being audited. Moreover, in light of the factoryʼs unique
circumstances, we provide guidance for improvement action plans, as we conduct “guidance type audits.”

Comments from Partners
This brand development initiative with CRAHUG has allowed subcontracted sewing
factories like ours to showcase their own capabilities to society. With the company andstaff growing together, I hope we can communicate the attractiveness of not only ourbusiness but also that of Akita Prefecture, which will contribute to regional
revitalization.
CRAHUG staff members took the lead on branding, and I myself worked hard to gather
information, reading specialized books and so on. It was a great opportunity for me todeepen my knowledge of branding and marketing, and to learn their importance.

*QMD is an acronym for “Quality Merchandising.” It means from the product planning stage, we provide total support for quality,
including material color fastness and physical performance checks, to appearance checks through product testing of sample
products, to commercialization.

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Work Style Design
We aim to achieve work-life synergy by cultivating a working environment where every employee can work cheerfully, freely, and vigorously.
We are implementing the Work Style Design Project for workstyle reform and enriching personnel systems so that all employees can bring their skills, capabilities, and new ideas
into full play, thus enhancing and adding color to their everyday lives. We will strive to achieve work-life synergy by enabling employees to enhance both work and private life while
meeting customersʼ expectations and contributing to society.

Work Style Design Project
The Onward Group is executing the Work Style Design Project to enhance operational efficiency
and productivity by achieving work-life balance. This workstyle reform project encourages
employees to take the initiative in changing the way they work.
We started this initiative not with the purpose of merely reducing overtime work, increasing
leave days taken, or improving work efficiency. Rather, we would like to use the time saved bymaking these changes in order to create opportunities to give shape to new ideas and makeinnovations.

■ Kaeru Kaigi meetings
Each team that usually works together holds meetings to consider what team members should do toimprove their workstyles. Kaeru Kaigi meetings go beyond simply facilitating reports on work progress topromote self-driven processes of repeating trial and error by all members for the purpose of transforming
workstyles and achieving their goals for work. Psychological safety is critical to holding these meetings. We
have fostered a climate of free and open discussion by sharing awareness of “sharing your opinion no
matter what it is, not rejecting opinions that are shared, but giving a reaction.”
Changes as a Result of the Work Style Design ProjectWork Style Design Project Goal ❶Work styles conscious of productivity
Enable members to work more efficiently by proactively promoting work style reforms
through Kaeru Kaigi, and establishing systems.
Realizing work-life balance
Enriching privacy in oneʼs free time saved by the project
Creating work-life synergy
A fulfilling private life and work influence each other, and create synergy

Work Style Design Project Goal ❷Organizations with high psychological safety
Kaeru Kaigi meetings creating an environment where everyone can easily express
their opinions
Creating innovation
Proactively generate new ideas, leading to the buds of new businesses

ANNUAL REPORT 2023

FY02/19 Result

FY02/20 Result

FY02/21 Result

FY02/22 Result

FY02/23 Result

17.7 hours

18.2 hours

6.3 hours

6.8 hours

8.4 hours

Days of leave taken

119.0 days

125.1 days

124.0 days

124.9 days

123.4 days

Rate of taking My Golden Week*2

−

−

39.4％

39.0％

53.3%

Overtime hours*1*1*1 Calculated based on the personnel within the scope of Work Style Design (office workers of Onward Kashiyama Co., Ltd.)*2 System to encourage employees to take 10 consecutive days off■ New Initiatives
In September 2022, we introduced the “workinterval system” to ensure that our employees
have 11 hours from the end of the previous
workday to the start of work on the next day.
We support employees to continue working
while maintaining a work-life balance by
securing a certain amount of rest time for themto have sufficient time for living and sleeping
hours.

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Diversity
We welcome diversity and aim to be an enterprise where diverse and unique personnel can exhibit their strengths.
The Onward Group realizes that in order to respond to diversifying customer values and needs and contribute to society, the Onward Group must be an enterprise where diverseand unique personnel are encouraged to exhibit their strengths.
Welcoming each personʼs unique qualities and capabilities, we are cultivating an environment that can facilitate innovation.

Empowerment of Female Employees

Promotion to Support the Balance between Work and Childcare

The fashion business requires fresh ideas and innovative value propositions. We believe thatsuch ideas and propositions are best created when all employees respect and accept thedifferences between individuals and are able to exercise their skills to the fullest.
We have established the Diversity Promotion Section within our human resource division inorder to foster a workplace environment in which all employees can feel motivated and deliver
their best performance. This section is responsible for revising prior work processes andimplementing ongoing workstyle reforms for the purpose of improving productivity.

Aspiring to be an enterprise where diverse and unique personnel can exhibit their strengths, theOnward Group supports employeesʼ efforts to achieve a good balance between work and childcare.
As a result, in FY02/23, among eligible employees, the proportion of female employees taking
childcare leave recorded 100%, male employees 60%, marking a significant increase from FY02/22.
Moving forward, we will aim to increase the percentage among male employees to 100%.

Proportion taking childcare leave
Ratio of Female Employees

Ratio of Female AssistantManagers

79.3%

Ratio of Female Managers(Section Manager and Above)56.5%

as of the endof FY02/23

28.1%

as of the endof FY02/23

as of the endof FY02/23

FemaleFY02/19 Result

FY02/20 Result

FY02/21 Result

FY02/22 Result

FY02/23 Result

100.0%

100.0%

97.0%

100.0%

100.0%

Male

7.7%

10.5%

20.0%

27.3%

60.0%

Total

59.3％

65.3％

79.1％

75.0％

86.2%

*Calculated based on the personnel within the scope of Work Style Design (office workers of Onward Kashiyama Co., Ltd.)

81.0%

as of the end of
FY02/2254.0%

as of the end of
FY02/2227.2%

as of the end of
FY02/22(All figures are for Onward Kashiyama)■ New Initiatives
We have introduced a mentoring program to train female candidates for executive positions in FY02/23.
This is a program in which experienced senior employees (mentors) support the personal
development of junior employees (mentees) by assisting them in resolving career development issues
and concerns through interactive dialogue.
In FY02/23, the first year of the program, officers (mentors) were provided with training in areas
such as interview skills as a trial. They conducted mentoring with female general managers (mentees)
every other week. In FY02/24, we plan to continue mentoring on an even greater number of female
managers.

ANNUAL REPORT 2023

■ New Initiatives
We have introduced the shift selection system
to allow employees to choose their working
hours from 13 types of shifts in FY02/23.
Aiming to create an environment in which
employees can work with a sense of fulfilment
while maintaining work-life balance, we are
running this system alongside the “workinterval system” of 11 hours.

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Initiatives for Human Capital Management
We aim to be an enterprise where diverse and unique personnel can exhibit their strengths forthe sustainable improvement of our corporate value.
To evolve into a customer-centric company and make the best use of its employeesʼ diverse strengths, Onward isendeavoring to train in-house personnel who will spearhead change while ramping up the recruitment of
personnel externally in order to promote organizational and human resource platform reform. We thereby aim tobecome a company where diverse and unique personnel can exhibit their strengths.
■ Introduction of Various Training Systems to Enable Diverse and Unique Human Resources to Exhibit Their Strengths
Experiential Diversity Training

This experiential training is for newly appointed managers in a managerial position of a teamwhich enable them to notice the importance of management utilizing diversity

Harassment Training

This training aims to provide managers with knowledge on harassment as a whole to create
environments where harassment is not tolerated and does not occur

Hanjin Onward LearningThis original in-house video content provides useful information and knowledge regarding
everyday customer service

e-learning

Psychological Safety Training

ANNUAL REPORT 2023

Our e-learning programs provide participants with content to enable them to casually acquire
the skills for adapting to a new era of managing diverse and unique human resources, andbroad expertise in accordance with various situations
This training is for Group officers and above to promote the creation of teams with psychologicalsafety, where members can share their thoughts and feelings to anyone in the organization withpeace of mind

Promote the activities
of diverse personnel

Achieve a flatorganization

Diversify workstyles

Organizational andHR platform reform
Offer multiple career
paths and focus on
personnel
development

Transfer authority to
the front lines
Provide fair,
multifaceted
evaluations andperformance-based
compensation

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Respecting Human Rights and Developing the Working Environment
We emphasize ensuring human rights and occupational safety and health throughout the supply chain in Japan and overseas.
Onward-Approved Factory System
Societyʼs expectations for companies to exercise social responsibility are rising, expanding the scope of risks that could present problems in business operations. These risks
include environmental pollution in countries and regions from which products are procured as well as human rights violations at factories.
We have been operating the Onward-Approved Factory system since FY02/16. Through factory audits by the Japan Apparel Quality Center (hereinafter JAQC), we work toensure that work environments at production sites are safe and comfortable.

Initiatives to Respect Human Rights and Working Environments of
Sewing Factories

Audit Targets

In 2007, JAQCʼs predecessor, the quality control department of Onward Kashiyama became obligated

Our goal is to conduct guidance type audits, in which we point out problems of factories that do notsatisfy the standards of the audit, and help factory management understand the significance of theissues. We then take into consideration the factoryʼs unique circumstances, and present specificmethods such as guidance for improvement action plans.
As a result of these efforts, the percentage of audits that resulted in a pass or conditional pass
has risen from 80% in FY02/17, the year after the audit began, to 97% in FY02/23.

to conduct CSR audits of its production factories, at the behest of international brands with which it
had licensing agreements.
Audits related to CSR are conducted in accordance with Onward Holdingsʼ proprietary Suppliersʼ
Code of Conduct, which is based on international standards. Actual audits are entrusted to local audit
firms, but representatives from the JAQC are always present when audits are conducted. We thereby
endeavor to help ensure appropriate auditing based on the current business environment and todevelop the understanding necessary for us to exercise our responsibilities as the order placer tosupport factories in carrying out any improvements that need to be made.
We conduct audits based on the belief that, a brand holder has a social responsibility to point out
problems that could develop to human rights issues and help factory management understand thesignificance of the issues and improve their performance. Certificates of Onward-Approved Factory
are issued to factories that meet the prescribed standards. As for factories that do not satisfy thestandards, rather than terminating transactions with them, we thoroughly explain the purpose of theaudit and the reasons for the requirements to the management of the factory being audited. Moreover,in light of the factoryʼs unique circumstances, we offer support by providing guidance for improvement
action plans.

JAQC audit results (total number of audits including Japan and overseas)*The table below shows the number of audits by year, not the total number of factories.
Number of
Factories
AuditedPass■ PassConditional
pass*2Fail

FY02/17

20

9

45%

7

35%

4

20%

FY02/18

49

17

35%

27

55%

5

10%

FY02/19

118

52

44%

52

44%

14

12%

FY02/20

173

81

47%

80

46%

12

7%

37

10

27%

24

65%

3

8%

FY02/21

*1
*1

56

９

16%

39

70%

8

14%

FY02/23

34

19

56%

14

41%

1

3%

Total

487

197 40% 243 50% 47

10%FY02/22*1 For overseas factories in FY02/21 and FY02/22, CSR audits wereconducted only by local auditors.
*2 A conditional pass is a pass granted on the premise of prompt
correction when nonconformities are found in relatively
important elements, including working hours, wages, andoccupational safety. In the case of a conditional pass, acorrectional audit will be conducted to confirm the status ofcorrections after 1 year.

ANNUAL REPORT 2023

■ Conditional pass

(Cases)■ Fail

173
12
80

118
14
52
81

49
27

56
5

52

37
24

20

3

8
39

34
14

1

4
19
17
7
10
9
9
FY02/17 FY02/18 FY02/19 FY02/20 FY02/21 FY02/22 FY02/23

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Respecting Human Rights and Developing the Working Environment
Japan Apparel Quality Center“Japanese quality,” cultivated to satisfy the most eagle-eyed customers, is renowned worldwide for its attention to detail and we believe it is a unique aspect of Japanese culture

with global appeal.
JAQC was established in March 2017 as a spin-off from the quality control department of Onward Kashiyama Co., Ltd., with the purpose of contributing to the development of theentire apparel fashion industry by enabling other companies and organizations in the industry to utilize the expertise and insights on quality control that Onward Kashiyama had
cultivated over many years.
In addition to auditing Onward-Approved Factories, JAQC provides its audit requirements and decision standards to the Japan Apparel-Fashion Industry Council so that its
expertise can be utilized throughout the industry. JAQC also offers advisory and audit proxy services for apparel and textile trading companies. Furthermore, JAQC provides QMD(quality merchandising), a comprehensive support for quality from the planning phase through to commercialization, such as checking the color fastness and physical performanceof materials, and checking the appearance by product testing.
Moreover, in June 2022, JAQC opened Shibaura Repair Workshop as a business for corporations, where it mends and repairs apparel, removes stains, does pressing, andrecycles products, thereby contributing to sustainability and environmental conservation in the apparel and fashion industry.
■ Suppliersʼ Code of Conduct Items

A

Legal compliance andmanagement

Business Partners of Onward shall comply with all relevant local laws and regulations.
Furthermore, Business Partners shall comply with all relevant legal requirements and respect the legal and moral rights of their employees. At the same time, in order tocomply with legal requirements, management systems for maintaining respective documents have to be established.

B Juvenile workforces

Business Partners of Onward shall not employ minors younger than the local legal minimum working age, or age 15. This code is applicable to all facilities of Business
Partners.

C Forced labor

Business Partners of Onward, in any part of their business, shall not associate with business partners who utilize captivity or forced labor. Additionally, Business Partners of
Onward shall not associate with business partners who violate the above.

Wages, allowances, andbenefits

Business Partners of Onward shall comply with all laws and regulations on local wages, hours of work, and allowances. Fundamental policy on wages and allowances shallcomply with local laws, regulations and standards, while equally satisfying international requirements.
Onward will not associate with any Business Partner who violates local laws and regulations or industry common practices.

E Harassment and abuse

Business Partners of Onward shall not utilize any form of physical or psychological coercion or retribution to workers. Furthermore, Business Partners of Onward shall not
associate with business partners who violate the above.

F Work hours

Business Partners of Onward shall comply with all legal requirements regarding work hour issues and abide by all local laws.

G Non-discrimination

Business Partners of Onward shall not discriminate in employment or recruitment on the basis of age, nationality, race, color, gender, religion, or any other factor. Business
Partners of Onward shall not associate with business partners who partake in any form of discrimination.

H Health and safety

Business Partners of Onward shall provide a safe and healthy work environment for workers.
Additionally, they shall ensure not to expose workers to an unsanitary and hazardous workplace environment.

I Free association
Sub-contractors andJhomeworkers

Business Partners of Onward shall guarantee the freedom of unions and workers who wish to join unions in accordance with local requirements.

D

Business Partners of Onward shall require all entities to which they outsource some or all of the duties with which they have been entrusted to comply with the Suppliersʼ
Code of Conduct and shall inform Onward of such outsourcing.
Business Partners of Onward shall have basic awareness of environmental protection. Business shall be conducted in accordance with local and internationally recognized

K Environmental practices environmental practices.
ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Stakeholder Engagement
We have established a mission statement of “enriching and adding color to peopleʼs lives while caring for the planet.” Guided by this purpose, we aim to
evolve into a customer-centric company and make the best use of its employeesʼ diverse strengths.
To that end, we believe it is vital to build and maintain strong networks and relationships with our customers and all other stakeholders we connect within our corporate activities.
Enriching and Adding Color to Childrenʼs Lives Through the Universal Language of Fashion

Communities

As part of its efforts to promote sustainable management, Onward Kashiyama Co., Ltd. is engaged insupport activities to enrich and add color to childrenʼs lives through the universal language of fashion. As
part of support activities for the Tokyo Foster Family Association, which assists foster parents and foster
children, we gift children clothing to celebrate their entrance into elementary school every spring. Tokyo
Foster Family Association is one of Japanʼs leading organizations both in history and in scale. We launchedthese activities in 2014 with the belief that providing support through the association is the first step towardsupporting children. Moving forward, we will continue offering support activities alongside the Tokyo Foster
Family Association to play our part in supporting childrenʼs healthy growth and independence.

Achieving Work-Life Synergy Through Work Style Design

Employees

In FY02/23, Onward Kashiyama Co., Ltd. introduced the “shift selection system” and the “work interval
system” as part of its Work Style Design initiatives. As a result, these systems has helped realize
work-life balance in various ways, such as the generation of the time employees can spend on hobbies,
securing time for childcare or nursing care, or the transition from reduced working hours in line withchildcare and nursing care to full-time hours.

Other
Can work for full-timewithout working
reduced hours
Became easier toshare childcare andnursing care duties
with family members

7%

11% 17%24%

41%

Became easier toorganize the schedule
within working hours

Became easier to makeplans for private life
(hobbies andenrichment lessons)Planning and Production of Uniforms and SDGs Education

Business
partners

ANNUAL REPORT 2023

Onward Corporate Design Co., Ltd. (former Onward Trading Co., Ltd.) is engaged in the businesses ofplanning, production, and sales of school uniforms. In FY02/23, in addition to the planning andproduction of new school uniforms, the company also began providing a new service in the provisionof systematic learning opportunities that only corporation bodies could offer. As the first step, Onward
Corporate Design planned and produced a new school uniform for Senior High School at Sakado,
University of Tsukuba, and hosted an experiential lesson using an SDG board game designed forenvironmental education. Twenty-seven eleventh grade students who participated in the lesson
deepened their understanding of the SDGs, and the lesson achieved a satisfaction rate of 97.6%.

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Message from the Management

Value Creation Model and Sustainable Management

Environment

C or p o ra te G ove r nan ce

ANNUAL REPORT 2023

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Corporate GovernanceManagement Team

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Corporate Governance
Our Basic Approach to Corporate GovernanceDirectors and the Board of Directors

The Onward Group believes that responding promptly to changes in its business environment andensuring a level of corporate governance that enhances the health, fairness, transparency, andcompliance of its management and operations are among its most important responsibilities and central
to increasing corporate and shareholder value.
In its basic management policy, the Onward Group has defined its business domain as “a world of
fashion that gives refreshment and beauty to peopleʼs lives.” By offering fashion as an integral part ofconsumer culture, the Group creates new lifestyles and values that contribute to the enrichment of life forall people. Moreover, the Company believes that, in order to exercise this policy and accomplish its
objectives, it is vital for it to build and maintain strong networks and relationships with customers and allother stakeholders it connects with in its corporate activities.

In order to further clarify the management responsibilities of directors, to increase opportunities to gain
the confidence of shareholders, and to put in place an optimal and flexible management framework thatis capable of responding to changes in the business environment in a timely manner, the Company has
set the term of directors at one year. In addition, two of the six members of the Board of Directors (fivemen and one woman) are appointed from outside the Company and selected on the basis of their highlevel of independence. This initiative is aimed at reinforcing the supervisory function of the Board.
In FY02/23, the Board of Directors met 13 times, and four separate meetings were held in the formof document correspondence.

Corporate Governance Structure

Name

General Meeting of Shareholders

Consultation

ReportBoard ofDirectors

Audit

Standing Audit &Supervisory Board Members
Outside Audit & Supervisory
Board Members

Onward Group
Compliance
Committee
ReportCoordination

Supervision

ANNUAL REPORT 2023

Internal Control
OfficeAudit

Group Companies

Akira Kawamoto

Yoshie Komuro

We have elected Ms. Komuro as an Outside Director because we are expecting her to use
her expertise as a corporate manager and experience and insight developed throughserving as an expert sitting in various government-affiliated councils to enhance theCompanyʼs management. She attended 13 out of 13 (100%) Board of Directorsʼ meetings.

Skill Matrix of the Board of Directors

Name

ReportOnward Group
Strategy Meeting

Accounting Audit

Accounting Auditor

Reasons for Appointment as an Outside Director and Status of Attendance in FY02/23

We have elected Mr. Kawamoto as an Outside Director because we are expecting him touse his extensive experience gained while working for the government for many years
and diverse knowledge and insight from his academic experience to enhance theCompanyʼs management. He attended 13 out of 13 (100%) Board of Directorsʼ meetings.

Audit & Supervisory
Board

Nomination andCompensation
Committee

AdviseSupervision

Reasons for the Appointment of Outside Directors

OutsideExpertise and Experience Expected by the Company
Directors andOutside Audit
Company International
Legal Affairs
Finance&
Management Experience
Compliance
Accounting
IT/Digital
Supervisory
Business
Overseas
Risk
M&A
Board
Operation
Business
Management
Members

Michinobu Yasumoto●

Kenji Chishiki

●

●

●

Osamu Sato

●

●

●

Daisuke Ikeda●

Akira Kawamoto○●

Yoshie Komuro

○

●

●

●

●
●

Personnel
Diversity
Environment
CSR

●

●

●

●
●

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Corporate Governance
Audit & Supervisory Board Members and the Audit & Supervisory Board

Group Governance

The Company has adopted an Audit & Supervisory Board structure, under which the Company has appointed
four Audit & Supervisory Board members (three men and one woman), two of whom are outside Audit &Supervisory Board members. Staff has also been assigned to assist Audit & Supervisory Board members incarrying out their duties and to strengthen their supervisory function. Each member audits and monitors theperformance of directors. Responsibilities include reviewing the documentation of important decisions andattending important meetings, such as Board of Directorsʼ meetings, Group financial account settlement
meetings, and budget committee meetings, in accordance with audit policies and the roles established by the
Audit & Supervisory Board. In addition, the Internal Control Office and business departments conductperiodic monitoring in an effort to establish an effective and lawful corporate structure.
The Audit & Supervisory Board meets with the representative directors and the accounting auditor ona regular basis to share and exchange information and opinions. This initiative is also designed to ensure astructure is in place that is capable of conducting audits in an effective and lawful manner. Moreover, theAudit & Supervisory Board receives reports from each member in accordance with audit policies and theroles. Deliberations are undertaken and resolutions are made based on this information as required.
In FY02/23, the Audit & Supervisory Board met 16 times.

The Onward Group has adopted a holding company structure that allows the Companyʼs Board of Directors
to engage in strategic decision-making and supervise operating companies. At the same time, the Group has
separated the supervisory and execution functions in order to clarify the responsibilities and authority ofeach operating company and to facilitate accelerated strategic decision-making.
When matters that require urgent attention arise, the Board of Directors convenes as necessary. In thismanner, the Onward Group has a system in place that ensures a swift and appropriate response to rapidchanges in the business environment.
Moreover, the Group has introduced an executive officer system (six male executive officers but nofemale representation at this time) with the aim of clarifying management decision-making and businessexecution functions. In order to facilitate flexible decision-making on a Groupwide basis, the Onward Group
Strategy Meeting, which primarily comprises directors and operating officers from Group companies, is inplace to review the management strategies and important management matters of operating companies
and confirm the status of operations.
The Onward Group also has advisory contracts with a number of attorneys to receive legal advice.

Reasons for the Appointment of Outside Audit & Supervisory Board Members
Name

Reasons for Appointment as an Outside Audit & Supervisory Board Member and Status of Attendance in FY02/23

Ryu Umezu

We have elected Mr. Umezu as an Outside Audit & Supervisory Board Member because we are
expecting him to use his wealth of knowledge, insight, and specialties from his experience as an
attorney, particularly his robust insight and experience pertaining to capital market transactions
and financial transactions, in audits of the Company. He attended 13 out of 13 (100%) Board of
Directorsʼ meetings and 16 out of 16 (100%) Audit & Supervisory Board meetings.

Mitsuyo Kusano

We have elected Ms. Kusano as an Outside Audit & Supervisory Board Member because weare expecting her to use her wide-ranging experience and robust insight from her years ofexperience in the media industry and her time on expert panels of government committees
in audits of the Company. She attended 13 out of 13 (100%) Board of Directorsʼ meetingsand 16 out of 16 (100%) Audit & Supervisory Board meetings.

WEB

For the Independence Standards for Outside Directors and Outside Audit & Supervisory Board Members, please refer tothe Corporate Governance Policy on the Companyʼs website.

https://www.onward-hd.co.jp/en/company/policy_en.pdf

Nomination and Compensation Committee
The Nomination and Compensation Committee functions as both a nominating committee and acompensation committee. The Nomination and Compensation Committee responds to consultations
from the Board of Directors by discussing matters pertaining to the nomination and compensation of
directors. The results of these discussions are reported to the Board of Directors.
The Nomination and Compensation Committee is to comprise three or more members selected by
the Board of Directors, a majority of whom should be outside directors designated as independent
directors.
ANNUAL REPORT 2023

Evaluation of the Effectiveness of the Board of Directors
The Companyʼs directors conduct annual self-evaluations to assess the effectiveness andappropriateness of the Board of Directorsʼ management oversight function as well as the degree ofaccomplishment of their own duties. The results of these evaluations are reported to the Board of
Directors. Based on these self-evaluations, the Board of Directors analyzes and evaluates its overall
effectiveness, disclosing an overview of the results.

1. Scope of evaluations
All directors and Audit & Supervisory Board members

2. Procedures for evaluations
Self-evaluation via questionnaire
Support for evaluations provided by external advisor

3. Overview of results of analysis and evaluation of Board of Directorsʼ
effectiveness in FY02/23
Board of Directors effectively exercising functions for establishing management strategies andtargets, resolving management issues, and overseeing business execution in accordance with
Onwardʼs Corporate Governance Basic Policy
Current composition, discussion quality, and operation methods of Board of Directors generally
appropriate
Ongoing examination of diversity of the Board of Directors, monitoring of operational execution,and number of agenda items and materials for the Board of Directorsʼ meetings as well as more
efficient operation required in the FY02/24 for improvements to the effectiveness of the Boardof Directors

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Corporate GovernanceDirectorsʼ and Audit & Supervisory Board Membersʼ Compensation
Policies for Deciding Amounts of and Calculation Methods for Directorsʼ and Audit & Supervisory Board Membersʼ Compensation❶ Policies for Deciding Amounts of Directorsʼ and Audit & Supervisory Board MembersʼCompensation
Compensation paid to directors and Audit & Supervisory Board members of the Company comprises basic
compensation and compensation for the purpose of acquiring Company stock, which are fixed compensation,and bonuses, which are performance-linked compensation.
Outside Directors and Audit & Supervisory Board members only receive basic compensation from thestandpoint of maintaining independence.
Additionally, the Nomination and Compensation Committee, the majority of the members of which are outside
directors, was established as a voluntary advisory body to the Board of Directors. The amount allocated toindividual directors is determined by the Board of Directors, upon discussion of the matters relating to thenomination and compensation of directors by the Nomination and Compensation Committee and reports to
the Board of Directors.

i. Basic Compensation
Basic compensation is paid to directors and Audit & Supervisory Board members based on predefined
standards that take into account factors such as full-time or part-time status, role, rank, years of service, andperformance evaluations. Specific amounts of compensation paid to directors are determined by the Board of
Directors while amounts of compensation paid to Audit & Supervisory Board members are determinedthrough discussions among Audit & Supervisory Board members.

ii. Compensation for the Purpose of Acquiring Company Stockn June 2015, the Company replaced the prior stock options with compensation for the purpose of acquiring
Company stock, with the aim of improving the motivation of directors to pursue stock price increases andbusiness performance improvements. Compensation for the purpose of acquiring Company stock is paid to
directors (excluding outside directors).

million a year for outside directors) at the 60th Annual General Meeting of Shareholders held on May 24, 2007.
The number of directors at the time of the resolution was seven.
Additionally, at the 74th Annual General Meeting of Shareholders held on May 27, 2021, it was resolved tomaintain the upper limit for total compensation paid to directors (at ¥500 million a year) but to revise the upper
limit paid to outside directors from ¥30 million a year to ¥50 million a year. The number of directors at the timeof the resolution was seven.
The upper limit for the compensation paid to Audit & Supervisory Board members was resolved at ¥60 million
a year at the 48th Annual General Meeting of Shareholders held on May 25, 1995. The number of Audit &Supervisory Board members at the time of resolution was four.
❸ Performance Indicators and Method for Determining the amount of Performance-Linked Compensation

Bonuses are paid as performance-linked compensation. The purpose of this compensation is to reflect singleyear business performance in compensation, heighten motivation for improving business performance, increase
focus on accomplishing management targets, and clearly evaluate successes.
Bonuses are based on Companywide performance in accordance with the same standards used to calculate thebonuses of employee ranks and adjusted based on performance evaluations that comprehensively account forfactors such as the degree of accomplishment of target indicators for management accounting that include sales
and profit and loss in the areas of responsibility assigned to each director at the beginning of each fiscal year.
Performance evaluations are determined at the Onward Group Strategy Meeting attended by directors, Audit &Supervisory Board members, and executive officers.

Total Amount of Compensation Paid by Classification of Directors and Audit & Supervisory Board
Members, Total Amount of Compensation Paid by Type of Compensation, and Number of Eligible
Directors and Audit & Supervisory Board Members
Total Amount of Compensation Paid by Type of Compensation (Millions of yen)iii. Bonuses
Bonuses are paid to directors (excluding outside directors) based on the Companyʼs consolidated
performance, etc. for the given fiscal year.
The authority to determine the amount of compensation, etc. for directors of the Company and the policy for
determining the calculation method is held by the Board of Directors. The amount of compensation, etc. isdetermined within the total amount approved by the general meeting of shareholders by comprehensively
taking into account factors such as the directorʼs duties, the business performance of each fiscal year, andthe degree of the directorʼs contribution.
The compensation, etc. for Audit & Supervisory Board members is determined through discussions among
Audit & Supervisory Board members within the compensation amount approved by the general meeting ofshareholders upon taking into account factors such as full-time or part time status and the division of duties.
❷ Resolutions by the General Meeting of Shareholders with Regard to Directorsʼ and Audit &Supervisory Board Membersʼ Compensation
The upper limit for the compensation paid to directors was resolved at ¥500 million a year (including ¥30

ANNUAL REPORT 2023

Classification

Total Amount ofCompensation
Paid(Millions of yen)Fixed Compensation

Performance-Linked
Compensation

Number of Eligible
Directors and Audit& Supervisory
Board Members

BasicCompensation

Compensation for the
Purpose of Acquiring
Company Stock

Bonuses299（27）165（27）

47（−）

86（−）

7（３）

Audit &
Supervisory
Board Members

52（16）

52（16）

−（−）

−（−）

6（２）

Total

351（43）217（43）

47（−）

86（−）

13（５）

Directors(of which, Outside
Directors)(of which, Outside
Audit & Supervisory
Board Members)

Note: As of February 28, 2023, the Company had six directors and four Audit & Supervisory Board members.

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Corporate GovernanceTraining of Directors, Audit & Supervisory Board Members, and Executive Officers

Initiatives for Compliance

The Company offers opportunities for directors, Audit & Supervisory Board members, and executive
officers to acquire the knowledge necessary for performing their duties along with opportunities forongoing self-study to ensure that they are able to fulfill their roles and responsibilities. In addition,
discussions are held with new directors, Audit & Supervisory Board members, and executive officers upon
their appointment regarding the Companyʼs management, business, and financial strategies; important
relevant matters; and identification of issues faced by the Onward Group and their solutions. Outside
directors and outside Audit & Supervisory Board members, meanwhile, are provided with explanations of
the Companyʼs business and organizational structures when they are appointed, and necessary
information pertaining to issues faced in business activities and other matters is supplied regularly.

As for initiatives for compliance, the Group created the Compliance Manual to clearly outline the direction ofcompliance activities and define standards for adhering to ethical concerns and social norms. The Onward
Group Compliance Committee takes the lead in conducting continuous educational activities, including
in-house training, as a part of efforts to ensure widespread awareness and understanding. Moreover, theGroup strives to maintain and improve product quality and subsequently raise customer satisfaction by
utilizing its expertise in quality control through the Japan Apparel Quality Center. In addition, the Company
will continue to improve the working environments at our partner factories through the Onward-Approved
Factory System as a facet of its supply chain management.
Also, in terms of the Act on the Protection of Personal Information, the Company has established
Guidelines on the Protection of Personal Information and continuously carries out training by conducting
seminars for all officers and employees.

Policies for Cross-Shareholdings and Exercise of Related Voting Rights
In addition to stocks held purely for investment purposes, the Company may hold shares of listedcompanies with the aim of maintaining and strengthening business relationships and thereby improving
medium-to-long-term corporate value. With regard to cross-shareholdings, the Board of Directors
will conduct annual assessments of the meaningfulness and economic rationality of these holdings,
taking into account growth potential, profitability, strengthening of business relationships, etc., from theperspective of controlling shareholding risk and capital efficiency. Our basic policy is to sell thoseholdings that are deemed to no longer be appropriate after gaining the understanding of the business
partner in question. In addition, holdings that have been deemed appropriate may also be sold in light ofthe market environment, management and financial strategies.
Furthermore, with respect to the exercise of voting rights related to cross-shareholdings, in order toensure appropriate responses, the Company deliberates on each agenda item in accordance with thefollowing criteria from the perspective of the medium-to long-term improvement of the corporate value ofthe business partner in question and medium-to long-term increases to the economic benefits for theCompany and Group companies, and make a comprehensive decision on approval or disapproval at theBoard of Directors meeting each year.
(1) Whether the counterparty has been suffering from a significant and ongoing deterioration in businessperformance?
(2) Whether the counterparty has engaged in any antisocial activities or otherwise lost the trust ofsociety?
(3) Whether there are any proposals submitted that may harm the interests of shareholders?

Compliance System
Recognizing that society as a whole increasingly expects it to improve its compliance systems, theOnward Group has positioned compliance as an important issue for management. Furthermore, byenhancing its corporate governance systems, the Company aims to earn high levels of trust amongits customers and shareholders and from society as a whole.
The Company has established the Onward Group Compliance Committee as an organization foroverseeing the Companyʼs compliance structure.
ANNUAL REPORT 2023

Risk Management System
The Onward Risk Management Regulations were established with the purpose of guiding the developmentof the Companyʼs risk management system. The Compliance Division is responsible for the development of
the risk management system, the identification of issues, and the formulation of risk-management-relatedplans. The division reports to the Board of Directors. An effective system is in place to address natural
disaster risk, information system risk, and other risks that may severely impact the continuation of business.
Additionally, the Board of Directors works in cooperation with external professionals as the situation
requires in order to respond appropriately to such risks.

Dialogues with Shareholders
The Company conducts various investor relations (IR) activities, and the IR Division has been established asa dedicated body for ensuring the functionality of these activities. This division maintains close coordination
with Corporate Planning, Accounting, Legal Affairs, and other relevant divisions. It also reports the opinions
and requests obtained through IR activities to the Onward Group Strategy Meeting and the Board of
Directors for use in discussions regarding measures for improving corporate value.
❶ Periodic briefings for analysts and institutional investors

The officer responsible for IR information disclosure plays a central role in holding periodic
briefings for analysts and institutional investors at which we explain our financial results
and business strategies.
❷ Provision of IR materials on corporate website

An extensive amount of information is disclosed through Onward Holdingsʼ corporatewebsite. Please refer to this website for information on various topics.
WEB https://www.onward-hd.co.jp/en/ir/library/

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Management TeamANNUAL REPORT 2023

Daisuke Ikeda

Nobuyoshi Onogi

Ryu Umezu

Mitsuyo Kusano

Hikosaburo Seike

Osamu SatoManaging Director

Standing Audit &Supervisory Board Member

Outside Audit &Supervisory Board Member

Outside Audit &Supervisory Board Member

Standing Audit &Supervisory Board Member

Managing Director

Yoshie Komuro

Kenji Chishiki

Michinobu Yasumoto

Akira Kawamoto

Outside Director

Director and Vice President

President and CEO

Outside Director

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Value Creation Model and Sustainable Management

FY 02/23 Re su lt

ANNUAL REPORT 2023

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Consolidated Financial Results
Apparel Business
Lifestyle Business

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Consolidated Financial Results
Net sales

Operating profit

176.1

¥

5.2

¥

billion

11 - Years Key Financial Data

Annual Cash Dividends per Shareretailer established in 1927 that pioneered the12

manufacture and sale of ready-made clothing in Japan¥billionand laid the foundation of the industry. Today, we

P40

continue to be recognized as a leading company in theSales Breakdown by Business Segment*1

Sales Breakdown by Japan/Overseas*1

Sales Breakdown by Domestic Sales Channel*2

LifestyleBusiness

Overseas

E-Commerce

8.9%

23.5%
76.5%

91.1%
Japan

years
P47

Apparel Businessoutstanding quality, and we are more than able tocompete in apparel markets at home and abroad. Our
business model encompasses all stages of the apparelsales within the Group. This fashion-oriented lineup
includes menʼs, womenʼs, and childrenʼs clothing as*3

SCs and
Other Channels

well as uniforms in the apparel business, dance wear,
pet-fashion items, gift catalogs, and others in thelifestyle business.

Number of Group Companies

96

ANNUAL REPORT 2023

36.8%

industry specializing in high-value-added products withvalue chain, including planning, design, production, andP35

Founding

Our History

Department
Stores

30.0% 33.2%

ApparelBusiness
Segment Information

The Onward Group is the apparel manufacturer and51

companies

Our Network

Number of Group Employees

6,061

P51

Note: Figures are results for the fiscal year ended February 28, 2023 or as ofthe end of the fiscal year
*1 Ratios are calculated by simply adding up figures before inter-company
eliminations.
*2 This targets domestic business companies that operate e-commerce.
*3 SC stands for shopping center.

Lifestyle Business

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Apparel Business

Domestic Apparel Business
Principal Company
Business Activities

Onward Kashiyama Co., Ltd.
Comprehensive apparel manufacturer of menʼs, womenʼs, andchildrenʼs clothing

Onward Kashiyama, which is a core operating company of the Group, offers womenʼs and menʼs core
brands and mainstay brands, such as Nijyusanku, ICB, Jiyuku, J. PRESS, and Gotairiku, primarily at
department stores and brands such as any SiS and any FAM at shopping centers. The company also
operates directly managed stores for such brands as JOSEPH and TOCCA at commercial complexes,
etc. to communicate the brandsʼ vision and message to consumers. In recent years, Onward
Kashiyama has developed brands whose main sales channel is e-commerce, including UNFILO,
steppi, uncrave, and #Newans. With the aim of making these brands mainstay businesses in the
future, Onward Kashiyama is offering an innovative customer experience based on a new businessmodel. The company is working to establish a new style of store operation by creating venues where
customers can enjoy the maximum benefits of both physical stores and e-commerce through Click &Try*2 services at OMO stores*1, a new business format offering the services of physical storescombined with those of online stores.
*1 Abbreviation for ʻOnline Merges with Offlineʼ*2 A service to deliver products customers are interested in from various brands offered by the e-commerce site ONWARD CROSSET
to their nearest physical store for try-on

Net Sales(Onward Kashiyama + HD)

Operating Profit(Onward Kashiyama + HD)(Millions of yen)

(Millions of yen)

89,31091,395

101,109
4,524(1,857)
FY02/21

ANNUAL REPORT 2023

FY02/22

FY02/23(12,761)
FY02/21

FY02/22

FY02/23

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Apparel Business

Domestic Apparel Business (for corporate clients)
Principal Company
Business Activities

Onward Corporate Design Co., Ltd. (former Onward Trading Co., Ltd.)
Operates the uniform business (company uniforms, school uniforms,
medical wear, etc.) and the sales promotion business for general
corporate clients

Onward Corporate Design proposes solutions to the branding and promotion issues faced bygeneral corporate clients in the fields of uniform business (company uniforms, school
uniforms, medical wear, etc.) and sales promotion business. The company is an apparel
manufacturer with sales, planning, and production departments, and ensures high quality andfunctionality, utilizing the Onward Groupʼ s characteristics to propose fashionable solutions,while carefully responding to client requests.

Overseas Apparel Business<Europe>Principal Company
Business Activities

Joseph, established by Joseph Ettedgui in 1972, is engaged in planning and sales of JOSEPH, a British brand.
JOSEPH offers the world a contemporary yet timeless wardrobe of luxury essentials. By reinforcing thebrandʼs positioning in the market while strengthening the online business through Josephʼs own e-commerce
operation, the company will continue its efforts to expand the business globally, including in Asia.

<Asia>
Principal Companies
Business Activities

Net Sales
Onward Corporate Designformer Onward Trading Co., Ltd.

(

Operating Profit
Onward Corporate Designformer Onward Trading Co., Ltd.

()(Millions of yen))

<U.S.>(Millions of yen)

14,76013,6501,645

Business Activities

1,788

1,021

FY02/21

ANNUAL REPORT 2023

FY02/22

FY02/23

FY02/21

FY02/22

Onward Fashion Trading (China) Co., Ltd.
Kashiyama (Dalian) Co., Ltd.
Onward Fashion Trading: Offers brands, such as Nijyusanku and ICB
Kashiyama Dalian: Operates a factory manufacturing mainly made-toorder suits

Onward Fashion Trading (China) is collaborating with local partners in China to expand e-commerceand cultivate new sales channels, as well as on product development, including local planning. The
company operates stores for made-to-order items of the KASHIYAMA brand in the Shanghai area. By
expanding touchpoints through strengthened digital marketing, the company is proposing a new styleof made to order to customers. Plans call for opening stores gradually elsewhere in China.
Kashiyama (Dalian) operates a smart factory capable of delivering high-quality made-to-order suitsin a week at the earliest. This is realized by combining automatization with the latest equipment andsystems such as IoT and Robotic Process Automation (RPA), and the accumulated sewing expertise andknowhow of craftsmen.

Principal Company
15,591

Joseph Ltd.
Operates JOSEPH, the global brand based in London, the UK.

J. Press, Inc.
Operates J. PRESS, a brand of authentic American traditional clothing

J. Press directly operates stand-alone stores of the J. PRESS
brand in New Haven, Washington, D.C., and New York City.
Founded in 1902, J. PRESS remains a pillar of the Ivy League
style. J. PRESS was a favorite brand of Gerald Ford, the former
U.S. president. J. Press is working to further strengthen thepresence of the J. PRESS brand in North America and elsewherein the world.

FY02/23

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Lifestyle Business

Wellness Business
Principal Company
Business Activities

Pet & Home Life Business

Chacott Co., Ltd.
Comprehensive business development including the sale of ballet/
dance goods and cosmetics, and the operation of ballet schools

With its “Make life beautiful from the inside out” brandphilosophy, Chacott is promoting comprehensive
business development, including the sale of ballet,
dance and fitness goods and cosmetics and theoperation of ballet schools, based on the “From Closed
to Open” strategy. While continuing to develop the coreballet business it has fostered since its founding,
Chacott has taken a step toward the next stage by
ramping up the proposal brands for the wellness area,
namely, Chacott BALANCE and Chacott COSMETICS.

Principal Company
Business Activities

Creative Yoko Co., Ltd.
Development of comfort goods and pet-related products

Creative Yoko plans and sells pet-related products and comfort goods. Shops operated by Creative Yoko
include PET PARADISE, Mother garden, and Sirotan Friends Museum. Sirotan, Creative Yokoʼs
proprietary character inspired by a harp seal, embodies the companyʼs philosophy of offering quality
merchandise and services that make people feel at ease, peaceful and positive. Mainstay products ofSirotan are soft cuddly toys of various sizes. The company is also actively working to achieve the SDGs,
and in 2020 it was certified as an SDGs promoting company by Nagano Prefecture. In 2022, Creative
Yoko received certification from Nagano Prefecture in the Work-Life Balance Course, as a company
where employees can choose work styles that fit various lifestyles and needs.

Net Sales(Chacott)Operating Profit(Chacott)

Net Sales(Creative Yoko)

Operating Profit(Creative Yoko)(Millions of yen)

(Millions of yen)

(Millions of yen)

(Millions of yen)

8,311

8,849

7,175

332

342

5,074

5,194

419

5,801
319
270

2019/2月期

FY02/21

ANNUAL REPORT 2023

FY02/22

FY02/23(848)

FY02/21

FY02/22

FY02/23

FY02/21

FY02/22

FY02/23

FY02/21

FY02/22PRINT

FY02/2337

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Lifestyle Business

Beauty & Cosmetics Business
Principal Company
Business Activities

KOKOBUY Co., Ltd.
Development of “ product, ” a natural organic cosmetics brand

KOKOBUY offers the “product” brand, a line of naturalorganic products launched in California, USA in 2007.
The “product” haircare items have earned the utmost
confidence of hair stylists and other professional
users. Today, they are recognized and favored by awide range of customers regardless of gender orgeneration. By offering products with high quality andvalue at affordable prices, KOKOBUY aims to makenatural organic products part of everyday life.
KOKOBUY will continue to offer sustainable productsthat are functional and friendly not only to peopleʼshair and skin but also to the environment.

Gifts Business
Principal Company
Business Activities

Yamato Co., Ltd.
Gift solutions featuring gift catalogs

In 2019, Yamato Co., Ltd., a major catalog gift company specialized in gifts joined the Onward Group.
Founded in Nagano Prefecture in 1940, Yamato started as a wholesaler of glassware, and has expanded
into gift solution businesses, including catalog gifts. Fully utilizing two strengths, namely, the planningand proposal capabilities cultivated in the gift market and the management and logistics function of the
support center at the head office, Yamato has a system in place capable of responding to diversifying
needs for gifts. Yamato endeavors to develop new products and services by strengthening e-commerceand entering the social gifting space to offer new value to customers.

Gourmet Foods Business
Principal Company
Business Activities

Onward Digital Lab Co., Ltd.
Operation of Onward Marche, an e-commerce site for high-quality
gourmet foods for refined tastes

Onward Marche is a high-quality gourmet foode-commerce website for individuals with refined tastes.
Based on the concept of “Coordinating the Delicious,”
our buyers travel across Japan to talk to producers insearch of exquisite culinary masterpieces, choosing
only the best based on sight and taste.
Like an artist painting a canvas, the richassortment of gourmet foods available at the Onward
Marche market enriches and adds color to peopleʼseveryday lives.

Net Sales(Yamato)Operating Profit(Yamato)(Millions of yen)

(Millions of yen)

18,3091,489

20,6291,280

797

FY02/21

ANNUAL REPORT 2023

20,326

FY02/22

FY02/23

FY02/21

FY02/22PRINT

FY02/2338

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

11-Year Key Financial Data
Analysis of Financial Position, Operating Results and Cash FlowsF i n a n c i a l D a ta an d
C or p o ra te I n f o rm atio n

Consolidated Financial Statements
Our History
Onward Group Key Brands
Our Network
Company Information
Stock Information

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

11-Year Key Financial Data
(Millions of yen)

Net sales
Cost of sales
Selling, general and administrative expenses
Operating profit
Recurring profit
Income taxes - current
Profit attributable to owners of parent
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Free cash flow
Capital expenditures
Depreciation and amortization
Cash and deposits
Current assets
Property, plant and equipment
Total assets
Current liabilities
Shareholders ʼ equity
Net assets
Basic earnings per share (EPS) (Yen)

FY02/13258,369
133,878
113,298
11,192
13,405
7,398
4,503
10,137(10,682)(7,848)
(545)
8,948
5,721
24,677
100,32186,861
286,779
100,740

FY02/14280,007149,270
120,537
10,20012,211
3,111
4,658
13,361(14,300)
2,121
(939)
16,7506,800
27,375
110,349
102,878
313,430
101,009

FY02/15
281,501
152,438
123,332
5,731
7,162
5,033
4,204
16,490(15,656)
757
834
26,884
7,218
31,122
117,051
109,658
340,854
109,619

FY02/16
263,516
144,063
115,674
3,778
5,504
8,679
4,278
3,632
1,782
(6,357)
5,414
15,955
7,799
29,407
121,468
106,695
313,454
106,109

FY02/17244,900
131,638
109,059
4,203
5,577
1,533
4,744
6,844
25,270(32,856)
32,114
10,5996,662
26,096
103,572
92,268273,226
85,684

FY02/18
243,075
129,498
108,409
5,167
5,928
3,305
5,366
13,228(7,299)(6,593)
5,929
12,0586,334
26,334
105,977
93,714
278,133
86,384

FY02/19
240,652
129,019
107,171
4,461
5,161
1,244
4,948
4,635
(10,305)
11,542(5,670)13,472
6,510
31,284
114,324
96,717
287,554
105,405

FY02/20
248,233
135,550
115,744(3,061)(3,835)
1,653(52,135)
8,003(10,758)(1,595)(2,755)9,533
6,392
28,795
106,782
83,231
234,316
108,743

FY02/21
175,899
105,196
90,876(20,173)(20,174)814(23,181)(19,614)
6,091
5,860
(13,523)
6,501
5,659
21,30180,46071,825
196,052
99,549FY02/22
168,453
80,841
88,691(1,079)
507
2,695
8,566
7,814
21,685(36,173)
29,4995,657
4,605
15,20960,50858,042
157,727
55,761

FY02/23
176,072
79,32091,537
5,214
5,319
1,387
3,061
5,685
4,390
(11,955)
10,075
4,921
4,366
13,80562,255
53,130159,198
53,124

177,141
165,372

178,077
175,028

179,879
185,315

176,263
172,337

169,027
165,670

168,341
168,152

167,429
162,210105,023
94,03668,92659,50975,03077,25775,721
85,073

28.71

29.69

26.78

28.27

31.47

36.97

35.24

(383.97)(171.18)

63.17

22.57

1,043.64

1,102.99

1,166.89

1,101.21

1,116.47

1,155.04

1,148.30

665.17418.32493.14550.76

Cash dividends (Yen)

24.00

24.00

24.00

24.00

24.00

24.00

24.00

24.00

12.00

12.00

12.00

Payout ratio (%)

83.6

80.8

89.6

86.5

74.0

63.7

66.9

̶

̶

19.0

53.2

ROE (%)

2.8

2.8

2.4

2.4

2.8

3.3

3.1

(42.0)(31.6)

13.9

4.3

ROA (%)

4.8

4.1

2.2

1.7

1.9

2.2

1.8

(1.5)

(9.4)

0.3

3.4

Operating profit margin (%)

4.3
48.2

3.6
46.7

2.0
45.8

1.4
45.3

1.7
46.2

2.1
46.7

1.9
46.4

(1.2)
45.4

(11.5)
40.2

(0.6)
52.0

3.0
54.9

Net assets per share (Yen)Gross profit margin (%)
SG&A expenses / Net sales (%)
Shareholdersʼ equity ratio (%)
Number of full-time employees (Consolidated)

43.9

43.0

43.8

43.9

44.5

44.6

44.5

46.6

51.7

52.7

52.0

57.1
5,208

55.2
5,224

53.8
4,973

54.2
5,119

59.8
4,456

59.2
4,530

55.1
4,643

38.3
5,153

28.9
7,498

42.4
6,377

47.0
6,061

Notes: 1. The Company has applied “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, March 31, 2020) and “Implementation Guidance on Accounting Standard for Revenue Recognition” (ASBJ Guidance No. 30, March 26, 2021) early, from the beginning of
FY02/22.
2. The presentation method has been changed from FY02/22, and therefore, with regard to net sales and operating profit for the previous fiscal year, the Company states figures after reclassification that reflect this change in the presentation method.
3. The increase in the number of employees (consolidated) in and after FY02/21, is mainly due to the changes in the employment categories of the Company and Onward Kashiyama Co., Ltd.

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Analysis of Financial Position, Operating Results and Cash Flows
Overview of Operating Results, etc.
During the fiscal year under review, the Japanese economy showed signs of a recovery as economic
activities normalized due to the relaxation of restrictions on activities related to COVID-19. However,
due to rising inflation on the back of soaring resource prices and raw material prices, the depreciationof the yen, and other factors, the outlook remains uncertain.
In these circumstances, the Group has been striving to evolve into a “customer-centricmanagement making the best use of employeesʼ diverse strengths.” To achieve the medium- to longterm management vision ONWARD VISION 2030 formulated in April 2021, in our core Apparel Business,
we have been actively pursuing e-commerce strategies through our group e-commerce site ONWARD
CROSSET in addition to managing physical stores. In particular, we have bolstered the development of
OMO (Online Merges with Offline)-type stores that integrate services offered in our physical stores andonline store, leading to a high number of users and contributing to increased sales in our physicalstores. Furthermore, as a result of our global business reforms and efforts to limit discount sales, ourgross profit margin improved by 2.9 pt, and our selling, general and administrative expense ratio
decreased by 0.7 pt. Consequently, we achieved profitability at all profit levels, including operating
profit. It should be noted that profit attributable to owners of parent decreased compared to that of theprevious fiscal year, which included gain on sale of real estate.
As a result of the above, consolidated net sales amounted to ¥176,072 million (a 4.5% increaseyear-on-year), a consolidated operating profit was recorded at ¥5,214 million (an operating loss of¥1,079 million for the previous fiscal year), a consolidated recurring profit was recorded at ¥5,319
million (a 948.7% increase year-on-year), and profit attributable to owners of parent amounted to ¥3,061
million (a 64.3% decrease year-on-year).

Status by Business Segment[Apparel Business]
In the domestic business, the number of visitors to physical stores increased, sales were favorable in
the key brands of our core operating company, Onward Kashiyama Co., Ltd., namely Nijyusanku, ICB,
and Jiyuku, among others, and the D2C brand UNFILO created hit products, contributing to sales
growth. As a result, the business achieved an increase in sales. Sales also increased at Onward
Personal Style Co., Ltd., which develops the KASHIYAMA brand, as the company accelerated thedevelopment of franchise stores in addition to directly-managed stores.
In the overseas business, due mainly to withdrawal from unprofitable businesses under the global
business reforms, the profitability of existing businesses improved significantly.
As a result of the above, net sales amounted to ¥134,761 million (a 4.4% increase year-on-year)
and an operating profit was recorded at ¥2,389 million (an operating loss of ¥3,279 million for theprevious fiscal year).

[Lifestyle Business]

BALANCE, with sales recovering to pre-pandemic levels. Creative Yoko Co., Ltd., which operates a pet
and home life business, posted strong sales as its strategy of opening physical stores proved
successful.
As a result of the above, net sales amounted to ¥41,310 million (a 4.8% increase year-on-year) andan operating profit was recorded at ¥3,756 million (a 56.3% increase year-on-year).

Cash Flows
Cash flows provided by operating activities amounted
to ¥5,685 million (an inflow of ¥7,814 million for theprevious fiscal year) mainly due to a profit before
income taxes, an impairment loss, an increase ininventories, and an increase in trade payables.
Cash flows provided by investing activities
amounted to ¥4,390 million (an inflow of ¥21,685
million for the previous fiscal year) mainly due toproceeds from sales of investment securities andproceeds from sales of shares of subsidiaries
resulting in change in scope of consolidation.
Cash flows used in financing activities amounted
to ¥11,955 million (an outflow of ¥36,173 million forthe previous fiscal year), which primarily included a
net increase (decrease) in short-term borrowings andrepayment of long-term borrowings.
As a result, cash and cash equivalents at theend of the fiscal year under review decreased by¥1,403 million compared with the end of the previous
fiscal year to ¥13,795 million.

Cash Flows(Billions of yen)
Cash flows
from investing
activities
Cash flows 4.3
from operating
activities
Cash and cash 5.6
equivalents at
beginning of
periodCash and cash
equivalents at
end of period
Effect ofexchange ratechange on
cash and cash
equivalents

15.1

13.7

0.4

(11.9)Cash flows
from financing
activities

As of Feb.
28, 2023

As of Feb.
28, 2022

Production, Orders and Sales
a. Production
The results of production by segment during the fiscal year under review are as follows.
Given the difficulty of defining production in the Lifestyle Business, the figures for “Production” arenot given.
Segment

Amount (Millions of yen)

YoY Change (%)

Apparel Business

13,654

77.7

Note: Figures represent manufacturing costs.

Chacott Co., Ltd., which operates a wellness business, saw strong performance of products in its
mainstay ballet and fitness wear merchandise line, as well as Chacott COSMETICS and Chacott

ANNUAL REPORT 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Analysis of Financial Position, Operating Results and Cash Flowsb. Orders

Net sales

The Group engages in mostly Make-to-Stock production rather than Make-to-Order production.
Furthermore, items produced by Make-to-Order are also produced by Make-to-Stock for the same
item, and it is difficult to calculate them separately. Therefore, descriptions are omitted.

Operating profit(loss)(Billions of yen)

168.4

Recurring profit

Profit attributable toowners of parent

176.0

c. Sales

8.5

The results of sales by segment during the fiscal year under review are as follows.
Segment

Amount (Millions of yen)

YoY Change (%)

121,337
13,424
134,761
41,310176,072

107.6
82.6
104.4
104.8
104.5

Domestic
Apparel Business
Overseas
Total
Lifestyle Business
Consolidated Total
Note: Inter-segment transactions have been eliminated.

Analysis of Operating Resultsa. Net Sales and Gross Profit
Net sales increased by ¥7,618 million from the previous fiscal year to ¥176,072 million due to aclear recovery of our key brands business centered on Onward Kashiyama Co., Ltd., which is ourcore operating company, and strong sales in stores that introduced the Click & Try OMO service.
Gross profit increased by ¥9,139 million from the previous fiscal year to ¥96,751 million andthe gross profit margin improved by 2.9pt due to our efforts of thorough inventory controls anddiscounted sales reduction measures.

b. Operating Profit and Recurring Profit
Selling, general and administrative expenses increased by ¥2,845 million from the previous fiscal yearto ¥91,537 million due to a decrease of the selling, general and administrative expense ratio thanks to
the outcomes of our global business reforms, etc.
As a result, operating profit (loss) improved by ¥6,293 million from the previous fiscal year to¥5,214 million and recurring profit increased by ¥4,812 million from the previous fiscal year to ¥5,319
million.

c. Profit Before Income Taxes and Profit Attributable to Owners of Parent
Extraordinary income amounted to ¥1,878 million as a result of gain on sales of investment
securities and gain on sales of shares of subsidiaries and associates, etc. Extraordinary losses
amounted to ¥3,388 million due to an impairment loss, etc. Profit before income taxes decreasedby ¥10,102 million from the previous fiscal year to ¥3,809 million and profit attributable toowners of parent decreased by ¥5,505 million to ¥3,061 million.

ANNUAL REPORT 2023

5.3

5.2

FY02/22

FY02/23

FY02/22

3.0

0.5

(1.0)
FY02/23

FY02/22

FY02/23

FY02/22

FY02/23

Note: Figures are rounded down to the nearest hundred million yen.

Analysis of Financial Positiona. Assets
Total assets increased by ¥1,471 million compared with the endof the previous fiscal year to ¥159,198 million. Current assets
increased by ¥1,746 million due to increases in merchandise andfinished goods, raw materials and supplies, etc. Non-current
assets decreased by ¥275 million due to the sale of property,
plant and equipment, etc.

b. Liabilities
Total liabilities decreased by ¥6,345 million compared with theend of the previous fiscal year to ¥74,125 million. Current
liabilities decreased by ¥2,637 million due to a decrease inborrowings, etc., and non-current liabilities decreased by ¥3,708
million due to a decrease in long-term borrowings, etc.

Financial Position(Billions of yen)

Total liabilities
Total assets and net assets
159.1
159.1

Current
assets62.2

Liabilities
74.1

Non-current
assets96.9

Net assets
85.0

b. Net assets
Total net assets increased by ¥7,816 million compared with theend of the previous fiscal year to ¥85,073 million. Shareholdersʼ
equity increased by ¥690 million due to decreases in profit
attributable to owners of parent, dividends of surplus, andretained earnings at the beginning of the period due to changes
in the accounting policies, and others. Accumulated othercomprehensive income increased by ¥7,170 million due to anincrease in valuation difference on available-for-sale securities
and others.

As of Feb. 28, 2023

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Consolidated Financial Statements
Consolidated Balance Sheets(Millions of yen)

As of February 28,
2022
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable̶trade, and contract assets
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
Land
Leased assets
Accumulated depreciation
Leased assets, net
Other
Accumulated depreciation
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Long-term prepaid expenses
Retirement benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
ANNUAL REPORT 2023

(Millions of yen)

As of February 28,
2023

15,20914,20423,908
449
2,478
4,509
(252)
60,50813,805
13,981
27,297
486
2,935
4,185
(437)
62,25558,027(35,019)
23,00823,371
9,998(6,239)3,759
25,158(17,254)
7,903
58,042

40,719(21,220)
19,49823,328
9,988(6,784)
3,204
18,548(11,449)
7,099
53,130

4,631
4,717
9,349

4,025
5,081
9,106

14,117
1,683
524
3,248
4,338
6,078
(163)
29,827
97,219157,727

16,433
2,882
383
5,441
3,454
6,442
(331)
34,706
96,943
159,198

As of February 28,
2022
Liabilities
Current liabilities
Notes and accounts payable̶trade
Electronically recorded obligations̶operating
Short-term borrowings
Current portion of long-term borrowings
Lease obligations
Income taxes payable
Provision for bonuses
Provision for bonuses for directors
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Lease obligations
Deferred tax liabilities for land revaluation
Retirement benefit liability
Provision for retirement benefits for directors and corporate auditors
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholdersʼ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholdersʼ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

As of February 28,
2023

6,361
11,86018,705
4,053
854
2,022
626
50
11,22555,761

8,154
13,236
14,880
3,720
887
1,129
914
179
10,021
53,124

12,377
3,676
241
2,858
247
2,503
2,804
24,70980,470

8,657
3,902
241
2,886
262
2,563
2,485
21,00074,12530,07950,39015,391(20,831)75,03030,07950,347
16,042(20,748)
75,721(1,646)
1(5,698)(328)(472)(8,144)122
10,24877,257
157,7272,620
30(5,698)
1,441
631
(973)
82
10,24385,073
159,198

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43

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Consolidated Financial Statements
Consolidated Statements of Income

Net sales
Cost of sales
Gross profit
Total selling, general and administrative expenses
Operating profit (loss)
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Subsidy income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on disposal of salesfloor fixtures, etc.
Share of loss of entities accounted for using equity method
Financial expenses
Other
Total non-operating expenses
Recurring profit
Extraordinary income
Gain on sales of investment securities
Gain on sales of non-current assets
Gain on sales of shares of subsidiaries and associates
Subsidies for employment adjustment, etc.
Other
Total extraordinary income
Extraordinary losses
Loss on sales of shares of subsidiaries and associates
Impairment loss
Loss on liquidation of subsidiaries and associates
Extraordinary loss due to closing and other
Other
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent
ANNUAL REPORT 2023

(Millions of yen)

For the fiscal year
For the fiscal year
ended February 28, ended February 28,
2023
2022
168,453
176,072
80,841
79,32087,61296,751
88,691
91,537(1,079)
5,214
52
1,340
99
1,013
917
3,423

28
205
789
136
219
1,380

391
96
73
176
1,098
1,836
507

363
45
46
186
632
1,274
5,319

105
17,921
2,944
289
67
21,327

527
21
1,300

1,829
1,741
1,968
1,620
761
7,921
13,912
2,695
2,523
5,218
8,693
127
8,566

Consolidated Statements of Comprehensive Income

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to:
Owners of parent
Non-controlling interests(Millions of yen)

For the fiscal year
For the fiscal year
ended February 28, ended February 28,
2023
2022
8,693
3,111
4,267
29

292
(13)
1,042
1,370
272
2,963
11,657

2,256
1,103
7,656
10,767

11,501
155

10,231
535

−

−

29
1,878

−

2,906

−

5
475
3,388
3,809
1,387
(688)
698
3,111
49
3,061
PRINT

44

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Consolidated Financial Statements
Fiscal year ended February 28, 2022 (from March 1, 2021 to February 28, 2022)(Millions of yen)

Shareholdersʼ equity

Balance as at March 1, 2021
Cumulative effects of changes in accounting policies
Restated balance
Changes during period
Dividends of surplus
Profit attributable to owners of parent
Purchase of treasury shares
Disposal of treasury shares
Reversal of revaluation reserve for land
Net changes in items other than shareholdersʼ equity
Total changes in items during period
Balance as at February 28, 2022

Share capital

Capitalsurplus30,07950,3909,321

50,390272
9,594

30,079Retainedearnings

Accumulated other comprehensive income
Treasuryshares−50,3905,797
15,391

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment

Total
Remeasurements accumulatedof defined benefit
other
plans
comprehensive
incomeShare
acquisitionrights

Noncontrollinginterests

Total net
assets

68,926(1,939)15(7,864)(1,669)(744)(12,202)

138

2,646

59,509(20,865)272
69,198(1,939)15(7,864)(1,669)(744)(12,202)

138

2,646

272
59,781

(0)
34

(18)
(1,124)−

Deferred
gains orlosses onhedges(20,865)(1,627)
8,566

30,079Valuationdifference on
Total
shareholdersʼ availableequity
for-salesecurities

34(20,831)(1,627)
8,566
(0)
16
(1,124)
5,831
75,030(1,627)
8,566
(0)
16
(1,124)
292

(13)

2,166

1,341

272

4,058

(16)

7,601

11,644292(1,646)

(13)
1

2,166
(5,698)

1,341
(328)

272
(472)

4,058
(8,144)

(16)
122

7,601
10,24817,47577,257

Fiscal year ended February 28, 2023 (from March 1, 2022 to February 28, 2023)(Millions of yen)

Shareholdersʼ equity

Balance as at March 1, 2022
Cumulative effects of changes in accounting policies
Restated balance
Changes during period
Dividends of surplus
Profit attributable to owners of parent
Purchase of treasury shares
Disposal of treasury shares
Net changes in items other than shareholdersʼ equity
Total changes in items during period
Balance as at February 28, 2023

ANNUAL REPORT 2023

Accumulated other comprehensive income
Valuationdifference on
Total
shareholdersʼ availableequity
for-salesecurities

Share capital

CapitalsurplusRetainedearnings

Treasuryshares30,07950,39015,391(20,831)75,03050,390(782)
14,608(20,831)(782)
74,247(0)82(1,627)
3,061
(0)
39

30,079(1,627)
3,061
(43)
−

30,079(43)
50,347

1,433
16,042

82(20,748)

1,473
75,721

Total
Remeasurements accumulatedof defined benefit
other
plans
comprehensive
incomeDeferred
gains orlosses onhedges

Revaluation
reserve forland

Foreigncurrencytranslation
adjustment(1,646)

1(5,698)

(328)

(472)

(1,646)

1(5,698)

(328)

(472)

Share
acquisitionrights

Noncontrollinginterests

Total net
assets(8,144)122

10,24877,257(8,144)122

10,248(782)
76,474(1,627)
3,061
(0)
39

4,267

29

−

1,770

1,103

7,170

(39)

(5)

7,125

4,267
2,620

29
30

−

(5,698)

1,770
1,441

1,103
631

7,170
(973)

(39)
82

(5)
10,243

8,598
85,073PRINT

45

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Consolidated Financial Statements
Consolidated Statements of Cash Flows
For the fiscal year
ended February 28,
2022
Cash flows from operating activities
Profit before income taxes
Depreciation and amortization
Impairment loss
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Decrease (increase) in retirement benefit asset
Increase (decrease) in retirement benefit liability
Interest and dividend income
Interest expenses
Share of loss (profit) of entities accounted for using equity method
Loss (gain) on disposal of non-current assets
Loss on disposal of salesfloor fixtures, etc.
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Loss (gain) on sales of shares of subsidiaries and associates
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Other, net
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Income taxes refund
Net cash provided by (used in) operating activities
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of long-term prepaid expenses
Payments of guarantee deposits
Proceeds from refund of guarantee deposits
Payments for sales of shares of subsidiaries resulting in change in scope of consolidation
Proceeds from sales of shares of subsidiaries resulting in change in scope of consolidation
Other, net
Net cash provided by (used in) investing activities
ANNUAL REPORT 2023

13,912
4,605
1,741
766
(123)
(434)
(217)
(1,392)391
73(17,778)
96
(104)
−

(1,114)
1,004
3,405(1,013)
3,703
7,523
245
(425)
(2,064)
2,536
7,814
(32)
55
(2,929)32,270
(10)
687
(27)
(662)
1,099
(8,286)
1,620(2,098)21,685(Millions of yen)

(Millions of yen)

For the fiscal year
ended February 28,
2023

For the fiscal year
For the fiscal year
ended February 28, ended February 28,
2023
2022

3,809
4,366
2,906
794
330
(2,192)
26
(234)
363
46
4
45
(505)
166
(1,300)358(3,653)
3,077(1,032)
7,377
1,414
(414)
(2,726)35
5,685

Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Repayments of long-term borrowings
Purchase of treasury shares
Dividends paid
Proceeds from payments from non-controlling interests
Dividends paid to non-controlling interests
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period(38,471)(5,052)(0)(1,627)
10,000(2)(1,019)(36,173)602(6,070)21,270*15,199(4,796)(4,053)(0)(1,627)−(248)(1,229)(11,955)475(1,403)
15,199*13,795*Reconciliation of ending balance of cash and cash equivalents with account balances per Consolidated Balance Sheets is asfollows.
(Millions of yen)

For the fiscal year
For the fiscal year
ended February 28, ended February 28,
2023
2022
Cash and deposits
15,20913,805Time deposits with original maturities of more than 3 months
(10)
(10)
Cash and cash equivalents
15,19913,795(11)
11(2,164)
0
(3)
3,238
(69)
(878)
474
−

7,644
(3,851)
4,390
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46

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

Our History

The Onward Group has celebrated its 96th anniversary since its founding in
1927. We continue to move forward, with our sights set on the future, as we
aim to become a 100-year old company.

FY02/23 Result

96

Financial Data and Corporate Information

th Anniversary

1927 – 1940s

1950s – 1960s

1970s – 1980s

Founding

Development as a Menswear Manufacturer

Acceleration of Overseas Expansion

Onward Kashiyama Co., Ltd. is established in 1927 by its founderJunzo Kashiyama and begins operations as Kashiyama Tradingin Osaka.

In the 1950s, Onward begins the production and sale of ready-mademenswear. Taking its cue from apparel manufacturing in the UnitedStates, the Company adopts an assembly-line production system
and introduces such advanced equipment as Hoffman steam pressmachines. These efforts result in substantial improvements in
productivity and the quality of ready-made clothing.
Along with this success, the Company develops a businessformat for consignment transactions* between apparelcompanies and department stores that is now widely used in thebusiness operations of department stores. In the 1960s, driven
by Japanʼs high economic growth, Onward grows rapidly to
become a leading menswear manufacturer in Japan.

In keeping a step ahead of other Japanese apparel manufacturers,
during the 1970s Onward establishes subsidiaries in three of theworldʼs major fashion cities: New York, Paris, and Milan, and by
the end of the 1980s, Onward had built a foundation for overseas
business at the three cities. By establishing the local subsidiaries
in a short period of time, Onward succeeded in laying thefoundation of the overseas business, drawing on the most up-todate information on the global fashion business.
In the late 1970s, Onward appointed up-and-coming designer
Jean-Paul Gaultier to be an exclusive designer for its Bus Stopline of boutiques in Paris. His first fashion show is held in Paris in1978 with the support of the Company.

*Consignment transactions
Consignment transactions are atype of transaction in which theownership of a product is nottransferred, nor is a sale recorded,
when a product is delivered to a
department store or other retailer.
Rather, the ownership of a productis transferred and a sale is recorded
when a customer purchases a
product on display at a retailer.

C o mp a ny f o un de r
J u nz o K a s h iy a ma

Showa financial crisis–World War II

Post-war reconstruction–High economic growth

Stable economic growth–Bubble economy

Major Events

Major Events

Major Events

Westernization of womenʼs clothing trends (after the Great Kanto Earthquake
in 1923–)
Great Depression originating in the United States (1929–late 1930s)
World War II (1941-1945)

ANNUAL REPORT 2023

Start of mass-production boom (1950s–)
Ready-made clothing revolution for menʼs and womenʼs clothing (1960s–)
Economic boom created by the Tokyo Olympic Games (1962–1964)
Japan ranked No. 2 in the world for gross national product (1968)

First oil crisis (1973)
Plaza Accord (1985)
Enactment of Equal Employment Opportunity Act for Men and Women (1986)
Emergence of prominent Japanese designers
Spread of luxury fashion

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Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Our History

1990s

2000 – 20102010s – Today

Launch of Core Brands

Evolution into a Global Apparel Group

Road to Sustainable Growth

The womenswear business dramatically expands in the 1990s
with the launch of core brands, beginning with Kumikyoku in 1992
and followed by Nijyusanku, ICB, and Gotairiku.
The luxury brand boom driven by Japanʼs bubble economy
comes to an end in the 1990s, and consumers start to attribute
greater value to more refined and practical clothing, and they areable to find this style in Japanese brands.
Department stores begin expanding womenswear floor
spaces and emphasizing new brands from Japanese makers.
Thanks to this trend, Onward Kashiyamaʼs store numbers growrapidly after the launch of the new brands, and this impressive
growth forms the foundations for future advancement.

At the beginning of the century, Onward accelerated its global
strategies while maintaining its focus on the department store
channel in the domestic market. The strategies included fullscale entry into the Chinese market, establishment of amanufacturing platform in Italy, and acquisition of a prominent
European brand JOSEPH.
The transition to a holding company system is made in 2007.
In the years that follow, the Company continues to draw uniquely
powerful brands under its umbrella in Japan, acquiring petfashion pioneer Creative Yoko Co., Ltd. and Island Co., Ltd., themaker of the trusted Grace Continental brand for discerning
women. It was at this time that Onward truly makes a new start
as a global apparel group that undertakes various types offashion businesses all over the world.

After the global financial crisis of 2008, the landscape of the fashion
business and, subsequently, the structure of the apparel supply chain
undergo a drastic transformation. The emergence of so-called fast fashion,
the increase in production costs in Asia, the reorganization of domestic
department stores, and the rise of e-commerce can all be seen as indicatorsof this transformation.
Signaling its participation in the e-commerce field, the Onward Group
cuts the ribbon for ONWARD CROSSET, its directly managed e-commerce
website, in December 2009.
The Onward Membersʼ loyalty point card system, applicable to all
Onward Group brands, launches in 2014.
Through this and other initiatives, the Onward Group proceeds tostrengthen its customer base while accelerating its Omni-channel retailingstrategy, which merges the advantages of online stores and physical stores.
In 2017, the Onward Group launches the KASHIYAMA brand, a new
made-to-order suit business that employs a proprietary factory innovation
scheme to realize low prices and quick deliveries.
It would not be an exaggeration to say that in FY02/21, the COVID-19
pandemic dealt the hardest blow to the Onward Groupʼs domestic andoverseas operations since its founding. At the same time, the Group
continued to push ahead with the global business reforms to its operations
it undertook in October 2019, making steady progress regarding thewithdrawal from unprofitable operations in Italy, the discontinuation ofunderperforming brands, and the closure of domestic and overseas storesthat were not turning
profits. In April 2021, we
formulated ONWARD
VISION 2030, our
medium- to long-term
management vision forthe period up to
FY02/31.

Burst of bubble economy– Post-bubble recession

Era of economic maturity

Fourth industrial revolution (Industry 4.0)

Major Events

Major Events

Major Events

Release of Windows 95 (1995)
Rapid spread of the Internet among the general public
Diversification of retail channels and emergence of specialty retailers
selling of private label apparel

ANNUAL REPORT 2023

Lehman Brothers bankruptcy and global financial crisis (2008)
Mass consolidation and reorganization of Japanese department stores
Growth of fast fashion

Great East Japan Earthquake (March 2011)
Annual inbound visitors to Japan exceed 30 million (2018)
Global COVID-19 pandemic (ongoing from January 2020)

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48

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Onward Group Key Brands
Apparel Business
Brand
Logo

Development
Genre

Womenʼs
Golf

Womenʼs

Concept/Outline[Business Operating Company]
Japanese Womenʼs Standard
What does ʻJapanese Womenʼ mean to Nijyusanku?
Women who wish to enjoy the dignified, elegant beauty that emanates from within.
Sometimes uninhibited, sometimes reserved. Sometimes strong, sometimes gentle.
Women who keep their own style. What does ʻStandardʼ mean to Nijyusanku?
Simple, high quality, comfortable clothing, endlessly chic and beautiful designs thattranscend generations and time, and are widely and long-loved.
[Onward Kashiyama Co., Ltd.]This is an era in which the individuality of each person who lives his or her life comes
into focus. Be yourself, not dressed up. Wear something that looks good on you
instead of something thatʼs trendy. We offer effortless styles that can be worn both on
and off the job, with a focus on jackets for working women. Clothes that fulfill eachand every one of our customersʼ desires to be like this. Clothes that allow each andevery one of our customers to become the person they want to be.
[Onward Kashiyama Co., Ltd.]

Brand
Logo

Development
Genre

Menʼs

Adult casual wear with finesse proposed by Joseph Abboud. An international
American brand that takes inspiration from nature, manufactures from a variety ofperspectives, and proposes lifestyles for the wearer as well as the design of clothing,with the eternal theme of “coexistence with nature,” such as emphasis on natural,organic, and natural materials.
[Onward Kashiyama Co., Ltd.]

WomenʼsChildrenʼs

The Italian word “TOCCA” means “touch” in English. The brandʼs icon is the classic
and beautiful embroidery that one cannot help but want to touch. It expresses atimeless worldview of romantic, elegant and high quality style with a focus on the“TOUCH (texture)” that “TOUCHes (feelings)” the customer.
[Onward Kashiyama Co., Ltd.]

Womenʼs

WomenʼsClassy, quality, daily
Jiyuku proposes a natural and radiant wardrobe for the mature generation of women.
[Onward Kashiyama Co., Ltd.]

Womenʼs

The name is derived from ʻundyed essence.ʼ The word represents truly mature
women who can freely express themselves without excessive adornment, and thecomma (,) represents the women who, through their encounter with this brand, willcontinue to evolve toward the future with even greater abundance and beauty. The
brand proposes dignified elegance, unfussy glamour, and refined quality.
[Onward Kashiyama Co., Ltd.]MenʼsEnglish tradition, French flair, Italian chic, American rationality...
Standard clothes that incorporate the best of each country and are tailored withJapanese sophistication. “Japanese Gents Style” for todayʼs leaders.
[Onward Kashiyama Co., Ltd.]

WomenʼsMenʼsChildrenʼsFounded in New Haven in the Eastern United States, on the doorstep of Yale
University, in 1902. The brand has long been loved by the elite of American history
and represents the authentic American traditional.
[Onward Kashiyama Co., Ltd.] [J. Press, Inc.]

WomenʼsMenʼs

A British brand that offers the world a contemporary and timeless wardrobe with theessence of luxury.

Menʼs
Golf

ANNUAL REPORT 2023

any SiS proposes the NEXT FEMININE BASIC for Japanese working women.
[Onward Kashiyama Co., Ltd.]

WomenʼsChildrenʼs

WomenʼsChildrenʼs

We offer girly and casual styles for working women for whom both work and private
life are important. Based on the concept of “evolving staples” that constantly add new
essences to traditional materials and items, we offer items that combine quality,
cuteness, and zeitgeist.
[Onward Kashiyama Co., Ltd.]

Womenʼs

Clothes that are trendy and playful, yet classy.
A ladylike mode style for women who are sensitive to the times.
[Onward Kashiyama Co., Ltd.]

WomenʼsMenʼs“Something that can only be found here”
A real standard that can only be worn by adults who have established their own style.
It is a strange combination of form and comfort: comfortable yet shiny, crisp yet
lightweight. ATON takes pride in its uncompromising craftsmanship, backed byexperience and ingenuity in making the most of the original characteristics of materials.
[Onward Kashiyama Co., Ltd.]

Womenʼs

A new balance of basics with a focus on authentic tailoring and materials. We propose
a new set-up by combining various items with “just the right amount of trend.”[Onward Kashiyama Co., Ltd.]

Womenʼs

Based on four policies, we propose a new era of workwear that is tailored to theneeds of working women. “Co-Creation”: Creating what people really want together
with those who wear it. “Universal”: Finding clothes that suit any occasion and any
person. “Sustainability”: Making only what is necessary, not disposing of waste, andhaving good products at reasonable prices. “Easy care”: Can be worn beautifully as it
is after washing and drying.
[Onward Kashiyama Co., Ltd.][Onward Kashiyama Co., Ltd.] [Joseph Ltd.]
Brand of the British company DAKS that features the British traditional style. A total
coordination brand for adults who love authenticity, incorporating modernity into the
British tradition.
[Onward Kashiyama Co., Ltd.]“Lady to Wear, Ready for Feminine”

Clothes for a happy tomorrow. Busy, commonplace days pass by. Just by imagining,“Iʼm going to wear this outfit tomorrow,” you can make an ordinary day seem a little
more special. any time, any wear, any fam.
any FAM will continue to create “opportunities for happiness” for people who wear
our clothes.
[Onward Kashiyama Co., Ltd.]Be Happy For the smile of contemporary woman.

̶For the smiles of all women̶

Concept/Outline[Business Operating Company]

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49

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Onward Group Key Brands
Apparel Business
Brand
Logo

ANNUAL REPORT 2023

Development
Genre

Lifestyle Business
Concept/Outline[Business Operating Company]

Womenʼs
Menʼs

There are clothes that you pick up when you wake up in the morning, take a deep
breath, and think about your plans for the day. For example, when you go to the parkwith your dog, the thing you want next to lightness would be an idea that lifts yourspirits. Add a little bit of yourself and your current mood to your outfit even for awalk. 365 days of ordinary, varied, but lovely days. Take the season and the weather
on your side, and choose clothes that are kind to you, from UNFILO.
[Onward Kashiyama Co., Ltd.]

Golf

With the theme of “POP & WIT & YOU,” this golf wear brand makes the golf scene funand exciting with POP, colorful and twisted graphic items, and is easy to incorporate
into daily wear. The brand name “CIRCULUS” means “circle” in Latin, and expresses
the desire to share a good time with friends and to further expand the circle.
[Onward Kashiyama Co., Ltd.]

Womenʼs
Menʼs
Goods

Fashion always makes people excited and happy.
NAVE is a fashion platform that proposes branded content that makes people living in a
new era feel something about and inspired by fashion.
[Onward Kashiyama Co., Ltd.]

WomenʼsMenʼsChildrenʼs

Simply comfortable shoes made of knit.
Knit shoes that can be worn every day and washed as often as you like, just like
clothes.
steppi will support many peopleʼs daily lives from the feet up with its knit shoes.
[Onward Kashiyama Co., Ltd.]

WomenʼsMenʼsAiming to democratize “made-to-order,” the brand started selling made-to-order suitsin October 2017, as a new business based on an evolved omni-channel approach. It
takes measurements not only at its nationwide stores and Guide Shops, but also at
homes or offices, and from the second piece, orders can be placed through its online
store.
[Onward Personal Style Co., Ltd.]

Womenʼs

We go to great lengths to travel the world to find and create the materials we areparticular about. The designers visit each country in person until they are satisfied, andthen carefully bring back the materials and inspirations they have found. They do thisbecause they know the beauty of the products so carefully finished. With the theme of“clothes for the truly fashion-conscious,” the brand targets women who areuncompromising in their quest for elegance.
[Island Co., Ltd.]

WomenʼsWith age comes grace. We would like to propose such elegant styling. We want todeliver elegant clothes for adults in their 30s and older that radiate beauty. We want tosupport women who work hard every day. And we hold such thoughts in mind.
[Tiaclasse Co., Ltd.]

Inner

What makes each day wonderful...thatʼs an unspoken secret. Chut! INTIMATES will
share such secret with you. It is a brand of intimate wear (lingerie) created with thehope that lingerie can be enjoyed like fashion.
[Intimates Co., Ltd.]

Brand
Logo

Development
Genre

Concept/Outline[Business Operating Company]

BalletFitness
Cosmetics

With its “Make life beautiful from the inside out” brand philosophy, the company
operates the Wellness Business based on the “From Closed to Open” strategy.
It has five brands: Chacott BALLET for ballet goods, Chacott BALANCE for fitness
goods, Chacott ARTSPORT for rhythmic gymnastics goods, etc., Chacott DANCE
for dance goods, and Chacott COSMETICS for cosmetics.
[Chacott Co., Ltd.]HaircareCosmetics

The natural organic brand “product” aims to make natural organic products part ofeveryday life by offering products of high quality and value at affordable prices. It
offers sustainable products that are functional and friendly not only to peopleʼs hairand skin but also to the environment.
[KOKOBUY Co., Ltd.]Pet products

Delivering a comfortable life for your precious family members. We propose
comfortable daily life and exciting lifestyles with pets.
The brand offers pet sundries, pet wear, dog food, and care products, etc.
[Creative Yoko Co., Ltd.]

Comfort goods

Sirotan, the companyʼs proprietary character inspired by a harp seal, embodies its
philosophy of offering quality merchandise and services that make people feel atease, peaceful, and positive. Since its birth in 1999, the Sirotanʼs mainstay products
have been soft cuddly toys of various sizes.
[Creative Yoko Co., Ltd.]

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50

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Our Network

EuropeUnited States

Asia
Japan
UK

China

Japan

USA

LondonShanghaiTokyo

New York■ Joseph Ltd.

■ Onward Fashion Trading（China）Co., Ltd.

■ Onward Holdings Co., Ltd.

■ J. Press, Inc.

■ Freed of London Ltd.

■ Shanghai Onward Fashion Co., Ltd.

■ Onward Kashiyama Co., Ltd.

■ Onward U.S.A. L.L.C.

■ Onward Trading（Shanghai）Co., Ltd.

■ Onward Corporate Design Co., Ltd.

Dalian■ Island Co., Ltd.

■ Kashiyama（Dalian）Co., Ltd.

■ Onward Personal Style Co., Ltd.

Hong Kong■ Onward Digital Lab Co., Ltd.

■ Onward Kashiyama Hong Kong Ltd.

（former Onward Trading Co., Ltd.）■ Intimates Co., Ltd.

Guam
■ Onward Golf Resort Guam, Inc.
■ Onward Mangilao Guam, Inc.

■ Chacott Co., Ltd.
■ KOKOBUY Co., Ltd.
■ Onward Creative Center Co., Ltd.

Vietnam■ Bien Co., Ltd.

Ho Chi Minh City

■ O & K Co., Ltd.

■ Onward Kashiyama Vietnam Ltd.

■ Onward Resort & Golf Co., Ltd.

Osaka
■ Tiaclasse Co., Ltd.

Nagano■ Pure Holding Company■ Apparel Business■ Lifestyle Business■ Creative Yoko Co., Ltd.
■ Yamato Co., Ltd.

Saga
■ Kashiyama Saga Co., Ltd.

ANNUAL REPORT 2023

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51

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Company Information
Company Overview As of February 28, 2023

Board of Directors, Audit & Supervisory Board Members, and Executive Officers As of May 26, 2023

Name

Directors

Onward Holdings Co., Ltd.
Onward Park Building
10-5, Nihonbashi 3-chome, Chuo-ku,
Tokyo 103-8239, Japan

Director and Vice PresidentTel(+81) 3-4512-1051 (IR Div.)

Outside Director

Established

September 1947

Outside Director

Capital¥30,079 million

Number of
Employees

6,061 (Consolidated)

Head OfficeMichinobu Yasumoto
Kenji Chishiki
Osamu Sato
Daisuke Ikeda
Akira Kawamoto
Yoshie Komuro

President and CEO
Managing Director
Managing Director

Audit &
Supervisory
Board
Members

Standing Audit & Supervisory
Board Member

Hikosaburo Seike

Standing Audit & Supervisory
Board Member

Nobuyoshi Onogi

Outside Audit & Supervisory
Board Member

Ryu Umezu

Outside Audit & Supervisory
Board Member

Mitsuyo Kusano

Executive
Officers

Managing Executive Officer

Kenji Takeuchi

Managing Executive Officer

Takeshi EgashiraManaging Executive Officer

Yoshihiro Higuchi

Executive Officer

Akira Murakami

Executive Officer

Jun Odagiri

Executive Officer

Hirofumi Nishimori

Note: The name of Ms. Yoshie Komuro in the family register is Yoshie
Ishikawa.

Corporate Organization As of March 1, 2023
General Meeting of Shareholders
Audit & Supervisory Board

Board of Directors
President and CEO
Director and Vice PresidentInternal Control Office

Personnel System Management

Secretary, Public Relations OfficeLifestyle Business

Sustainable Management Promotion OfficeInternational BusinessCorporate Planning Office

European Operations

Corporate Strategy & Development Office

North American Operations

DX Promotion Office

Asian Operations

Human Resources, General Affairs

Marketing & Product

Finance, Accounting, Investor Relations

Supply Chain Management
Corporate Business

ANNUAL REPORT 2023

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52

Message from the Management

Value Creation Model and Sustainable Management

Environment

SocialCorporate Governance

FY02/23 Result

Financial Data and Corporate Information

Stock Information As of February 28, 2023
Status of Shares

Distribution of Ownership among Shareholders

Major Shareholders
Authorized̶ 400,000,000 shares
Issued̶ 157,921,669 shares(Including 22,204,488 shares oftreasury stock)

Common Stock

Number of
Shareholders

48,140Stock Exchange
Listing

Tokyo Stock Exchange Prime
MarketTransfer Agent

Mitsubishi UFJ Trust & Banking
Corporation
1-1, Nikkocho, Fuchu, Tokyo
183-0044, Japan

Number of Percentage
Shares Held of Total(thousandSharesshares)IssuedName

The Master Trust Bank of Japan, Ltd.
14,435 10.6%(Trust account)
Kashiyama Scholarship Foundation
8,710 6.4%
Custody Bank of Japan, Ltd. (Trust
5,751 4.2%
account)
Onward Holdings Customersʼ
5,162 3.8%
Shareholdings Association
Nippon Life Insurance Company
4,671 3.4%
The Dai-ichi Life Insurance Company,
3,360 2.4%
Ltd.
Sumitomo Mitsui Banking Corporation 2,931 2.1%
SMBC Nikko Securities Inc.
2,640 1.9%
Isetan Mitsukoshi Ltd.
2,301 1.6%
DAIDOH LIMITED
2,149 1.5%
Notes: 1. The number of shares held is rounded down to the nearest thousand
shares.
2. The Company holds 22,204 thousand shares of treasury stock.
3. The percentage of total shares issued is calculated after deducting 22,204
thousand shares of treasury stock.
4. The percentage of total shares issued is rounded down to the nearest
indicated digit.

陽

14

1

陽

36

14

陽

18

55

陽

20

10

Stock Price Range and Trading Volume (Monthly)

19

7

陽

10

3

陽

陽

陽

陽

21

陽

陽

陽

12

Stock Price (¥)
600

5

陽

(On a number of shares basis)

Total Number of Issued Shares

157,921 thousand shares

Individuals
and others
76,904thousandshares

23.7%
48.7%

Financial
institutions
37,355thousandshares

3.6% Securities
companies
15.4%
5,747
thousand
8.6%
sharesForeigninstitutions andothers
13,586 thousand
sharesOther
corporations
24,328thousandshares

Notes: 1. The number of shares is rounded down to the nearest thousand shares.
2. Data regarding individuals and others includes treasury stock.

陽

Trading Volume (Thousand shares)

400

60,000200

40,00020,000003/2021

ANNUAL REPORT 2023

03/2022

03/20230

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