I NT EG RAT E D
R E POR T

2022

CONTENTS

02 Creating Expectations
02

Introduction

26	Identifying Material Issues with a View to 2030

04

New Structure of the WACOAL WAY28	Material Issues to be Addressed by 2030

06

Mission Formulation Process

30

07

Dialogue 01

		Our Mission to Realize an Outstanding
Future Combining the Views of Multiple
Generations
12	
Preparation of VISION 2030, the Medium- to Long-Term
Management Strategy Framework, and the New
Medium-Term Management Plan

14	Overview of VISION 2030 and the New MediumTerm Management Plan

16

Dialogue 02		Leveraging Digital Technologies to
Empower Personnel and Stay Close toConsumers in an Era of Rapid Change
20

Dialogue 03

		Creating a “Global Wacoal Group” for a
New Era by Demonstrating Established
Advantages, Local Capabilities, and aConsistent Philosophy
24

Dialogue 04

		Identifying Material Issues by Taking
Diverse Opinions into Consideration

Sustainability

		30

Response to Climate Change		32

Human Rights Initiatives

		33	Fulfilling Social Responsibilities
along Our Supply Chain
		
34

36

Strengthening Human Assets

Value Creation Process38	Meeting Expectations andFulfilling Commitments

Corporate Information (As of March 31, 2022)
Company Name
Head OfficeWacoal Holdings Corp.

 9 Nakajima-cho, Kisshoin, Minami-ku,
2
Kyoto 601-8530, Japan40

A Message from the President

Founding

44

Review of the Previous Medium-Term Management Plan

Capital46

VISION 2030

Representative Director,
President and CEO Hironobu Yasuhara

48

VISION 2030 Road Map

50

New Medium-Term Management Plan

52

Business Strategy

52

Wacoal Business (Domestic)		
56

Wacoal Business (Overseas)

60

Financial Strategy

64

A Discussion among Three External Officers

70Management Team72

Corporate Governance78

Establishing Mutual Trust through Dialogues

80

Investor Information / Our Corporate Website

June 15, 1946

Establishment

November 1, 1949

¥13,260 million

Line of Business Wacoal’s mainstay business is the
manufacture, wholesale, and direct sales to consumers(for some products) of intimate apparel (mainly women’sfoundation garments, lingerie, nightwear, and children’s
underwear), outerwear, sportswear, and other textile
products and accessories. In addition, Wacoal operates
other businesses related to food, culture, services, andinterior furnishing of shops.
Number of Employees (Consolidated) 19,717(Excluding the average number of part-time employees)

Editorial Policy
In accordance with international norms for integrated
reporting, the Wacoal Group has been issuing integrated
reports since fiscal 2011 as part of its communication
with shareholders and other investors. This integrated
report explains the Wacoal Group’s value creation
activities not only through financial information but
also through nonfinancial information about unique,significant assets and other facets of the Group’sbusiness.
Further, the website of Wacoal Holdings Corp.
includes a wide range of information about the Group.
We hope that referring to this integrated report inconjunction with the website will further understanding of the Group. Going forward, we will continue
pursuing an editorial policy that responds to changes
in reader expectations.

Forward-Looking Statements
Statements contained in this integrated report that are
not historical facts are forward-looking statements,
which reflect the Company’s plans and expectations at
the time of writing. These forward-looking statements
involve known and unknown risks, uncertainties, andother factors that may cause the Company’s actual
results, performance, or achievements to differ­materially from those anticipated in these statements.
Note: Pursuant with the adoption of the International
Financial Reporting Standards, “sales revenue” hasbeen used for fiscal 2023 and fiscal years thereafter,
while “net sales” has been used for fiscal 2022 andearlier fiscal years.

I N T E G R AT E D R E P O R T 2 0 2 201

Introduction

Remaining physically and emotionally close to customers and becoming a force
for beautifying the world by making ambitious changes and continuing to grow

For the first time since our founding,we have changed the structure of
the Group Philosophy and defined
our new Mission in modern society.
Under the leadership of the pure holding company Wacoal Holdings Corp., the Wacoal Grouphas developed innerwear businesses mainly in Japan, the United States, Europe, China,
and Southeast Asia. From the outset, our goal has been to contribute to society byhelping people to express their beauty.
Aiming to enrich lives around the world; help customers achieve self-realization that is free from
uniform assumptions about external beauty; and address social, environmental,
and human rights issues, in 2022 we defined our new Mission in modern society.
In accordance with our Mission and Founding Principles that have been passed down over a history of more than 70 years, each of our operating companies will view efforts to address increasingly complex and diverse social issues as opportunities for growth.
By advancing s­ ustainability-driven management that both addresses social issues and achieves
continuous growth through business activities, we will elevate enterprise value.

02

I N T E G R AT E D R E P O R T 2 0 2 2

CREATING EXPECTATIONSI N T E G R AT E D R E P O R T 2 0 2 2

03New Structure of the WACOAL WayMISSIONWACOAL empowers people with the confidence thatcomes from looking and feeling their best. As a global
leader, we welcome everyone into our caring ­community
built on mutual respect, diversity, and inclusion.
At WACOAL, we value each person as an individual and believein nurturing the body and mind so everyone can be their best.
When people with different backgrounds are empowered tocome together and share ideas freely, we as a society willachieve true harmony. By continuing to evolve,
WACOAL leads the way to a world where kindness, inclusivity,and mutual respect are the standards,
and the future is full of promise for everyone.

Global Corporate Message

Comfortable inside. Confident outside.

04

I N T E G R AT E D R E P O R T 2 0 2 2

CREATING EXPECTATIONSFounding Principles

Our Promise

We will contribute to society
by helping women to express their beauty.
Our Culture

We, the employees and management of WACOAL,
will maintain a refined corporate culture
based on mutual trust and will continually strive to
make the Company a global leader in the industry.
Our Value
1. Create products loved by customers
2. Develop new products that meet the needs of the times
3. Conduct business in a fair manner with a forward focus
4. Build a better WACOAL through better human resources
5. Fear not failure and boast not of successWith a strong desire to devote his life to working for society, Koichi

Tsukamoto founded Wacoal based on the belief that “a peaceful society is one
where women can express their beauty.” His goal was to contribute to society
by helping people to express their beauty. In achieving this goal, business

management based on mutual trust is essential. We have upheld our founder’sstrong commitment to creating a company trusted by all stakeholders acrossgenerations. Consequently, each Wacoal employee has inherited a mindset
that emphasizes mutual trust.

Koichi
Tsukamoto
Founder

I N T E G R AT E D R E P O R T 2 0 2 205

Mission Formulation Process
Members with diverse backgrounds discussed their respective values and formulated a new mission.
In April 2021, as we entered an unprecedented period of change, we discussed the outstanding future of Wacoal and Our Promise,
which the Group strives to keep, and identified important issues that we should address in order to achieve sustainable growth andimprove corporate value on our way to start the Sustainability Promotion Project. The project consists of six leaders (including
corporate officers) and 41 employees, with directors participating as supporters and external directors as advisors.

Mission of the Sustainability Promotion Project
We aim to discuss and redefine the outstanding future of Wacoal and Our Promise, which the Group strives to keep, as needed in orderto promote sustainability ­management, implementing sustainable growth and improving corporate value. In addition, we aim to identify
the material issues of the Group toward 2030 and set long-term targets for solving our challenges. The material issues and numericaltargets will be discussed at the Management Issues Review Meeting, and will be linked to the medium- to long-term management
strategy framework and the new medium-term ­management plan.

Sustainability Promotion Project(Period of Plan: April 2021 to March 2022)
Supporters

Owner

Tomoyasu Ito
Representative Director, Vice President and Executive Officer
Wacoal Holdings Corp.
Representative Director, President and CEO
Wacoal Corp.

Akira Miyagi

Vice President, Wacoal Holdings Corp.

Masaaki Yajima

Director, Wacoal Holdings Corp.

Hidehiko Imaizumi

Director, Wacoal Corp.

Yasuo Kamoshita

Director, Wacoal Corp.

Takahiko Hasegawa Director, Wacoal Corp.
Kazuhiro Shibahara Director, Wacoal Corp.
Mitsuru Sekiguchi

Leaders

Director, Wacoal Corp.

AdvisorTsunehiko Iwai

Naoko Ogawa

External Director, Wacoal Holdings Corp.

Corporate Officer, Head of EasternJapan Sales Supervising Division
Wacoal Corp.

Executive Office

Takuro Hori

Corporate Planning Department, Global Operations DivisionCorporate Officer, Head of Brand
Management Division 1
Wacoal Corp.

Corporate Communication Department
Wacoal Holdings Corp.
Business Planning Department, Technology and
Manufacturing Operations Division

Akiyuki Ueno

Wacoal Corp.

Corporate Officer, Head of Brand
Management Division 2
Wacoal Corp.

Yoji Kawaguchi
Marketing Management Division,
Head of CX Design Department
Wacoal Corp.

Hirofumi Inoue
Innovation Strategy Office,General Manager
Wacoal Corp.

Katsuya Hirooka
Corporate Officer, Headof Corporate Planning Department
Wacoal Holdings Corp.

06

I N T E G R AT E D R E P O R T 2 0 2 2

Members

30 employees in their 20s and
30s (open recruitment)*
11 management-level andmid-career employees (nominated)**C ompanies: Wacoal Corp., Nanasai Co., Ltd, and Wacoal Art Center Co., Ltd.
Departments: Human Resources, Public Relations, Marketing, Technology/
Production, Product Planning, Product MD, Sales, and Beauty Advisor (BA)CREATING EXPECTATIONS

Dialogue 01
Our Mission to Realize an
Outstanding Future Combining
the Views of Multiple Generations
For approximately one year, we have used the Sustainability Promotion Projectto think about our own ideals and the role we play in society. Leaders, mainly
corporate officers; mid-career nominated members; and young employees
openly recruited from the Company exchanged opinions from a variety of standpoints to define the mission that the Wacoal Group should fulfill in modern
society.

Rethinking the management
philosophy that has supported us
over the 70 years since our founding
The Sustainability Promotion Project
was launched in April 2021 and has
been a focal point of discussion for ayear. How did the environment around
you feel at the time the project started?
Hori With the COVID-19 pandemic wellunderway, I felt that it was time to reconsider the value that corporations contribute to society. We found ourselves
surrounded by various social issues, suchas the environment, human rights,
gender, diversity, and inclusion. I think it
was time for us to reconsider what weneeded to do in order to keep the Wacoal
Group a cornerstone of society.
In this project, leaders from varying
standpoints gathered to discuss themedium- to long-term vision of the
Wacoal Group.
Hori Sustainability as we define itmeans continuing to be a company thatis loved by our customers and needed bysociety. What supports this ideology is
the Company’s basic management philosophy. With that being the case, I took
it upon myself to carefully analyze ourmanagement philosophy. At the sametime, I looked at the performance andgrowth of the Group, seeing that not
everything was necessarily going toplan. In response, we started by trying todetermine exactly what was missing.

What steps did the project take as awhole?
Hori The project lasted for approximately a year, but in the beginning, sixleaders and Executive Office members
met several times a month for discussions. While sharing the vision of the
future envisioned by each leader, we
discussed the role the Group should playin modern society and what should be
identified as important issues.
Afterward, we decided we needed tolisten to the true and unbiased opinionsof young employees who will keep theCompany going long after we are gone,
instead of just tossing around our own
ideas. Therefore, we also nominatedmid-career members and recruited
younger members to join the discussion.
After gathering the new members
together, we would meet for discussions
once or twice a month.
There are 11 nominated members aswell as 30 members openly recruitedfrom Group subsidiaries and beauty
advisors. Were there any differences inyour way of thinking or sensibilities?
Hori The most difficult thing was
figuring out how to handle the original
management philosophy. Since ourfounding, the Group’s promise has been
to “contribute to society by helping
women to express their beauty.” Some
said it should be changed as gender is
not something to define in this day andage, while others said that since our corebusiness is women’s innerwear, theoriginal philosophy is appropriate. Evenamong the members who wanted tomake a change, there were varying

degrees to how much they wanted tochange the philosophy. It is only naturalthat everyone has their own thoughts, as
it is a phrase we cherish so much that
we have chanted it in unison at the
beginning of each month. My thought isthat it was important to revise the philosophy precisely because it is something so important to us.

Understanding the true feelings ofthe younger generation andhighlighting current issues
Ms. Inazumi participated as anominated member.
Inazumi I have been in charge ofdesigning men’s innerwear for quite awhile, so I was happy to be approached
for this project since I have always
wanted to challenge myself in different
ways beyond my department and industry. Last year was my first year after
being promoted to manager, so I felt a lotof pressure in my role of bringing
together the younger members fromopen recruitment and helping them
express their thoughts. That being said, I
was the only member participating as acreator, so as a representative of thecreators of the Company, I was conscious of conveying my thoughts on
manufacturing throughout the project sothat everyone could talk about the futureof Wacoal.
What are your thoughts on the Founding
Principles, Ms. Inazumi?
Inazumi The original Founding
Principles expresses the thoughts thatthe founder Koichi Tsukamoto had when

I N T E G R AT E D R E P O R T 2 0 2 207

Dialogue 01
he created the Company. His words
carry a heavy power that everyone here
has with them at their core. His basic
philosophy includes: “Create products
loved by customers” and “Develop new
products that meet the needs of thetimes.” During my time here, I havealways had these words in the back of
my mind, making sure the products I
made fit these ideals. Therefore, I do notthink the right move is to change thisphilosophy completely. Personally, I havefelt that we need to add an element of
humanity without limiting our goals bygender. While inheriting Mr. Tsukamoto’s
dreams, I wondered if I could create an
expression that conveys comfort andbeauty to a diverse range of people.
Ms. Sawa and Mr. Kitai joined throughopen recruitment. What made you wantto participate in this project?
Sawa I thought it would be interesting,since I heard that the project was a place

to talk with various members to create a
new path for Wacoal. I was interested inthis project because it was a project witha clear purpose that did not end with amere exchange of opinions. While I did
have opportunities in the past to discuss
how Wacoal should change and whatkind of image the Company should havein my past posts, these kinds of discussions never really reached a conclusion.
Of course, I very much sympathize withthe founder’s desires, but since modern
times face such a different society than
the society when the Company was
founded I always thought to myself, “Are
we really responding to the times?” and“Will the Company keep on growing likethis?” I decided to participate in the hopethat I could have constructive discussions for the future and give some shape
to something.
Kitai Even before I was a part of thisproject, I had a question about what
Wacoal is supposed to be like. I often

hear the words “Wacoal-ish” and“Wacoal-like” within the Company,
but I would always find myself vaguely
thinking that there might be a gap
between the essence of Wacoal that
employees think of and the essence of
Wacoal that customers expect. At thetime when I was worried that the gap
between us and our customers would
widen further, I decided to take part in
the open call that read, “Would you liketo think about what we should do toensure that Wacoal continues to grow in
the future?” The call for participation
also stated that “the goal of the entire
Group was going to be redefined,” so I
thought being a part of this could help
us find exactly what Wacoal should
work toward.
What kind of impression did you haveof the project during its course?
Sawa The participating members are
all from different generations, standpoints, and fields of experience, so what
they value and what they cannot compromise on are completely different. I
think this brought about some necessary
conflict, which led us to find a solution
among a sea of nonanswers that everyone could agree on. The process of finding that solution was tough.
Kitai Since all discussions were held
held online, it was a great experience to beable to discuss things without regard towhere we worked or what we were in
charge of. I felt a sense of responsibility
for participating of my own accord, andit was also an opportunity to discipline
myself to not neglect my daily duties inorder to take responsibility for what I said.

Moeko Sawa
Joined in 2015
Marketing Management Division,
Advertising Department, Tokyo
Advertising Section
Wacoal Corp.

08

I N T E G R AT E D R E P O R T 2 0 2 2

Inazumi Usually, I only have opportunities to talk with members that are
related to what I do in the Company. In
this project, I was able to touch on thethoughts of a wide range of members. I
once again learned that there are many
people with a strong passion for Wacoal,and there were many times I was
excited at the prospect of being able tocreate a bright future.

CREATING EXPECTATIONS

Hori We and the younger members of
the team have the same understandingof the challenges that arise when we
discuss what Wacoal is lacking. For
example, the older generation wants the
younger generation to take on challenges and they want to take action on
those challenges. However, they also feelunable to take on challenges head-on.
We say, “Let’s do it,” “Let’s make it
happen,” but they do not take it all theway. Why is that? I think the project wasa good opportunity for me to think
deeply about these things.

Takuro Hori
Joined in 1989
Corporate Officer, Head of Brand
Management Division 1
Wacoal Corp.

Where do we stand?
Facing 100 years for Wacoal
Holdings
In 30 years, in 2050, Wacoal willcelebrate its 100th anniversary. The
project held discussions on the great
future of the Wacoal Group (what it aims
to be by 2050).
Hori Among us six leaders, we talked
about the outstanding future of Wacoal.
The common theme we landed on wasthat we are becoming a company that isneeded by the world. This was an opportunity to confirm our thoughts of growing while taking on the challenge ofbusinesses that go beyond women’s
innerwear in order to contribute to theenrichment of the lives of people not
only in Japan but around the world.
Through our discussions, I also felt that
the Company should become worldleading not only on the business front,
but also in social contribution and environmental measures. As mentioned
earlier, our employees are well aware of
the challenges they have created forthemselves. We felt the necessity to aim
to become a company that promotes
well-being where every single employee
can work energetically while solving
these challenges.
Inazumi

The answer that I landed on

is that “the future is now.” Although we
may think of the future as some faraway thing, everything we think of andact on now is connected to the future.
That is why I realized that I need tocherish the present, really think about

what I can do now, and take action.
Sawa We often talked about how wewould like to create a society where
everyone can play an active role in theirown way, regardless of age, gender identity, or background. The world is changing rapidly, so we need to aim to be acompany that can flexibly respond tochanges without setting too many limits
on what we can do in the future. With
this in mind, during our discussions,
there were some opinions that weshould continue to engage in dialogue
with customers and society and reflect
their voices in our products andservices.
Kitai When considering the future of
Wacoal, I thought, “What about now?” If
the end goal is to foster a culture inwhich everyone can take on challenges,that means the “now” is not the best way
to go. There was also the opinion that it
is important to create a corporate culture
in which everyone supports people whotake on challenges. We even heard theopinion that, “to be a leading company,

we have to compete more. There is notenough of the ’I will make it happen
myself’ spirit across the company rightnow, including among the officers andmanagement.” I think it was good that I
was able to exchange opinions witheveryone regarding corporate culture.
As a result, it was concluded throughthe project that the framework of the
Wacoal Group’s management philosophy would be changed for the first time,
while maintaining the management
philosophy from its founding as thefoundation of the Founding Principles.
Hori The most heated discussion was
about the management philosophy.
These words have been used since theCompany was founded, so while it may
seem a bit old-fashioned, the thoughts
and message behind the words are universal throughout the Company. As aresult of our discussions, we decided
that it was necessary to carry on theaspirations of the Company’s founding
into the future by labeling all of the

I N T E G R AT E D R E P O R T 2 0 2 2

09

Dialogue 01

Shun Kitai
Joined in 2018
Technology and Manufacturing
Operations Division, Production
Control Department,
Production Control Section
Wacoal Corp.

Company’s past goals and Company andmanagement policies as the Founding
Principles. At the same time, we
exchanged opinions with management
and external directors on numerous
occasions in the process of deciding toformulate a new mission that we should
fulfill in modern society. It was a difficult process, but I think it was a goodexperience for me personally.

To be a presence thatstays close to customers
Please tell us about the thoughts behindthe new Mission.
Hori Our new mission keeps all ofwhat Wacoal holds dear. The idea that“everyone can be their best” expresses
the value of our products and services.
“Wacoal leads the way to a world wherekindness, inclusivity, and mutual respect
are the standards” expresses ourthoughts on society and the environment. “Nurturing the body and mind”

10

I N T E G R AT E D R E P O R T 2 0 2 2

expresses the importance we place on
the hearts and minds of our customers,
as much as we have studied the shape ofthe human body. Last but not least, theMission ends with “We welcome everyone into our caring community built.”
Here, I think that “welcome everyone
into our caring community” is anextremely important word choice. The
innerwear we handle is a product thatlays closest to your body, encroachingon personal space. Of course, we neverwant bad people coming into your personal space. Here, Wacoal declares that
if will be a part of its customers’ personal
space. We take this very seriously. It isalso a message that we will contribute to
the issues of modern society not fromafar but from the closest point of view.
Inazumi The comfort of the body is
directly linked to the comfort of themind. We always think about what we
can do to make people happy every day,and with a challenging spirit, discover
new needs and provide value. We do allof this with sincerity. We want to be acompany that supports each and every
one of our customers, regardless of theirgender and physical characteristics. The
value of beauty changes with the times,
so I would like for us to always pursue
beauty in the eye of the times.
What do you think is necessary in orderto realize our Mission?
Sawa Now that we have created thisnew Mission, I believe that everyone at
Wacoal has a responsibility to upholdthese words. I want each and every oneof us to be ready and conscious tochange. With this mission statement, weare saying that we will stay close to you,closest to your body and mind. We
would like Wacoal to become a presence
in society that is not just a good company among innerwear brands but acompany that society can rely on inorder to live a happy life.
Also, in this project, we were able toarrive at new answers by exchanging
opinions with people with varying ideas.
Because there is no absolute rightanswer, I felt that it was important foreveryone to think and discuss issues. I
go back to this Mission every day andsay out loud what I am and am not­getting done.
Kitai In order to put the mission into
practice, I think the ideal is to create
work and a culture that each and every
one of us can be proud of. If we are notenjoying our work, we cannot create
products that make our customers
happy. I want to love the Company that I
work for, and I want to create an environment where everyone can love it too.
What I want to do even more in the
future is to connect with the next generation of customers. Until now, I think
our business concept has been sellinghigh-quality products through polite
customer service by beauty advisors at
brick-and-mortar stores. Now with arapidly changing society, I think that wehave not yet created a concept in our
minds of how we as a company willinteract with the people of the next
generation. This is something I think allof us need to consider.

CREATING EXPECTATIONSInazumi I think that it is important for
us to have confidence. The message of
our Mission is to know who you want tobe and get closer to that image of yourself, step by step. The confidence born
thereof nurtures a kindness withinyourself to accept a diverse range of
people. I think of the people around me
and want to see everybody’s smiles. I
think that kindness is directly linked tohaving self-confidence. So, first of all, I
will take action so that I can be proud of
myself every day.

changing my conduct while always
taking action, and I would like to support
the Wacoal Group employees around theworld so that they can take action as

Hori In this way, we created a mission
together with everyone and identified
the material issues that the Wacoal
Group aims to resolve by 2030 throughdiscussion. What is more, we have alsoestablished the Guidelines for the
Actions of Officers and Employees thatclarify the direction of how we should
act in order to realize our Mission andaddress material issues. The mostimportant things are not just short-term
results but also what kind of actions wetake on a daily basis. The accumulationof these efforts will lead to the year 2030.
The key to practicing sustainability
management is to take action and transform our conduct. I will take the lead inwell. All members of the Wacoal Groupwill take action and work to evolve theGroup into an indispensable company.
Please look forward to our efforts.

Miki Inazumi
Joined in 2005
Brand Management Division 2,
Men’s Innerwear Sales Department,
Section Chief of Product Planning
SectionWacoal Corp.

Guidelines for the Actions of Officers and Employees
Guidelines for the Actions of Officers and Employees toward the Achievement of the
Wacoal Group’s “Mission” and “VISION 2030”“Think about thehappiness of others”“Embrace curiosity and“Consider the“Respect diverse opinions”
Do you listen to people's opinionswith humility and have constructive
discussions without making
assumptions?

Do you consider the happiness ofpeople around you, including thecustomers, suppliers, and employees
coworker you work with?

use all five senses”

reason and purpose”

Have you noticed or discovered
anything new lately?

Do you understand the true meaning
and root cause; why and what for?

“Make decisions for the future”“Give it a try first”“Work together”

Do you act not only for immediate
results, but also for a successful
future?

Do you give up out of fear of risks?
Do you support people who take onchallenges?

Do you strive for great successthrough teamwork andcollaboration?

“Act with honesty andresponsibility”
Do you communicate appreciation forothers? Do you have blamelessproblem-solving approach?

I N T E G R AT E D R E P O R T 2 0 2 2

11Preparation of VISION 2030, the Medium- to LongTerm Management Strategy Framework, and the
New Medium-Term Management Plan
MISSIONWACOAL empowers people withthe confidence that comes from looking andfeeling their best.
As a global leader, we welcome everyone into

Creating new value

our caring community built on mutual
respect, diversity, and inclusion.

VISION 2030,
Our Medium- to Long-Term
Management Strategy Framework
Management Strategy
Material Issues
Guidelines for the Actions of
Officers and Employees
Medium-Term
Management Plan
(FY2023 to FY2025)
Management Strategy
and Financial
StrategyFounding
Principles

With the aim of putting the WACOAL Way into practice, we have formulated VISION
2030 by backcasting from long-term goals while keeping in mind the issues of ourbusiness, customer values, and changes in society and the environment.
Based on this vision, our 2030 goal is to evolve and grow into a “Global Wacoal
Group” by capitalizing on quality and our heightened sensibility to provide each customer with physical and emotional beauty and enrichment. In achieving sustained
growth and enhancing enterprise value, we will improve domestic profitability andexpand our business areas, expand overseas businesses and transform them into
highly profitable structures, strengthen the Group’s management capabilities, and shift
to more capital-efficient management.

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I N T E G R AT E D R E P O R T 2 0 2 2

CREATING EXPECTATIONSVISION 2030, the Medium- to Long-Term Management Strategy Framework
To evolve as a corporate group needed by customers and society and achieve its new Mission, the Wacoal Group has
established VISION 2030, a medium- to long-term management strategy framework that sets forth the strategies andinitiatives that the Group must pursue in the period through 2030. VISION 2030 calls on us to evolve and grow into a“Global Wacoal Group” by capitalizing on quality and our heightened sensibility to provide each customer with physical and emotional beauty and enrichment. In addition, the vision comprises three elements: a management strategy,
material issues, and the Guidelines for the Actions of Officers and EmployeesWith beauty, comfort, and health at the coreof our businesses, we will create innovativevalue and achieve sustained growth.
P. 4 6 – 4 9Management
Strategy

VISION

2030

ActionMaterial Issues

The purpose of the guidelines is to makeInitially, a set of potential material issues

officers and employees more readily

was established by referring to levels ofadaptable to change. To encourage each

importance to society, stakeholders, andemployee to develop an awareness of whatbusiness growth as well as levels of impor-

the Wacoal Group is currently lacking andtance and urgency for business growth.

change their day-to-day behavior

External experts and executives then held

accordingly, the guidelines focus on

discussions to narrow down these material

fundamental mindsets and actions.

issues to those to focus on until 2030.

P. 1 1

P. 2 4 – 2 9

New Medium-Term Management Plan (Fiscal 2023–Fiscal 2025)
The three years covered by this plan will be critical for laying foundations that will enable us to realize the goal of VISION
2030. As a manufacturer that markets brands globally, we will concentrate on initiatives aimed at helping enhance the
day-to-day lives of many people and transforming into a highly profitable entity capable of sustained growth.
P. 5 0 – P. 5 1

I N T E G R AT E D R E P O R T 2 0 2 2

13Overview of VISION 2030 and the New

VISION

2030
P. 4 6 – P 4 9Provide greater value andexpand our business areas
P. 1 6 –Create a culture where diverse humanresources can play active roles
P. 3 4 –Return the Wacoal Business (Domestic)
to a growth trajectory

Medium-Term
Management Plan
(Fiscal 2023 – Fiscal 2025)

P. 5 2 –Strengthen the potential for growthin the Wacoal Business (Overseas)
P. 5 6 –P50–P51

Promote a human resources strategy that
supports growth

Achieve Increased Corporate(Consistently have price book-value ratio above 1.0 times andTo use our busines

14

I N T E G R AT E D R E P O R T 2 0 2 2

CREATING EXPECTATIONS

Medium-Term Management Plan

Continuously improve the­executive compensation system

Have an operating margin and
ROE of approximately 10%

Optimize the Board of Directors’
member structure
Solve material issues(Strengthen responses to environmental andsocial issues)
P. 2 6 –Optimize the capital structure
A Message from the President

A Discussion among Three External Officers

Complete domestic structural reform

Disclose the process for achieving our
ROE target

P. 6 0 –P. 6 0 –Strengthen responses to human rights andenvironmental issues

d achieve sustainable growth)

P. 6 4 –(Reform the revenue structure andimprove capital efficiency)

Achieve ROE above capital coste Value

P. 4 0 –Continuously improve the executive
compensation system
P. 7 5 –P. 3 0 –Create Social Value Unique to Wacoal(Provide greater value to customers and solve sustainability issues)

Fulfill the Group’s Mission
ss to achieve a society in which each person can live as themselves

I N T E G R AT E D R E P O R T 2 0 2 2

15

Dialogue 02
Leveraging Digital Technologies to
Empower Personnel and Stay Close toConsumers in an Era of Rapid Change
The Innovation Strategy Office has been providing new services to customers using digitaltechnology, such as 3D smart & try and Ava.Counseling Parler. Atsuko Shinoduka, theleader of the Innovation Strategy Office, and her members discuss past efforts, futureendeavors, and what kind of perspectives they used to create these services.

A Modern Update to
Customer Value Proposition
What challenges did you recognize in
Wacoal’s digital transformation?
Shinoduka With the spread of digital
devices and a drastically changing customer value system, the business model
we had developed based on our past
successful experiences was no longer
compatible with current customer
behavior. One of the biggest challenges
was our business structure based on theassumption that the channels andAtsuko Shinoduka
Joined in 2005
Corporate Officer, in charge of the Group DX
Marketing Strategy Wacoal Holdings Corp.
Corporate Officer and Head of Innovation Strategy
OfficeWacoal Corp.

16

I N T E G R AT E D R E P O R T 2 0 2 2

built-up brands were tied to each other.
The concept of vertical division, such as“this brand is for department stores,”“this brand is for general merchandise
stores,” or “this product is headed by thisoperations department,” was at the rootof everything. Customers began being
able to obtain information freely, withthe times moving to an age where highvalue items are not necessarily sold at
department stores and less expensive
goods not necessarily at general merchandise stores. Even with thesechanges, there was a fixed idea within
the Company to put channels at thefoundation.

(BAs), creating a stress-free measurement experience. What is more, wecreated Ava.Counseling Parler, anevolved counseling experience using 3D
smart & try. This was born from the ideathat if noncontact measurements werepossible, we could provide body consultations without the BAs being face-toface with customers. With these efforts,
we were really conscious of wanting toincrease customers’ choices. While somecustomers want to receive face-to-faceservice, others want a more casual experience. We thought it was essential toprovide options for a diverse customer
base and various situations they may
be in.

What kind of digital transformation did
you undertake under thosecircumstances?

In your mind, what kind of goods andservices were the consumers seeking?

Shinoduka Wacoal launched its
customer experience strategy (formerly
the Wacoal Omni-Channel Strategy) in
2016, and made it an in-house department in 2017. We began working toprovide products and services the way
customers want by connecting directlywith them beyond the boundaries ofchannels. This was our attempt to
update Wacoal’s strengths in face-toface connections with customers
through a modern twist. We have digitized customer records and centralized
customer data that had previously been
fragmented by channel, but it was 3D
smart & try that attracted attention inparticular. This was a way for us todigitize customer measurements previously performed by beauty advisors

Shinoduka Two keywords come tomind. The first is “personalization.”
Considering changes in consumers froma frontline perspective, we feel that
customers are demanding more personalized goods and services. We focus onwhat is good for an individual and whatworks for them, not what is good foreveryone. The other keyword is “transparency,” in more ways than one. In
terms of explaining things to customers,
we thought it was essential to provide
explanations with sound reason because
we live in an age where information isreadily available. When describing whysomething is a good fit, it is important tobe able to show why in as clear a way as
possible. We can use the physique measurement data obtained from 3D smart &CREATING EXPECTATIONS

3D smart & try
A service that proposes products suited to each customer by combining 3D bodyscanner measurements and an AI-enabled avatar. Currently, in 22 stores (as of
October 2022), more than 100,000 customers have used the service since its
launch in 2019. Of these, approximately 30% have gone on to make a purchase.

try to lead our communication. Of course,with normal customer service, a customer can consult with a BA, who willthen suggest products suitable for thecustomer. However, the more information available to the consumer, the moresatisfactory the data-based communication will be.

Personnel with
Diverse Backgrounds Allow
Us to Sincerely Confront Problems
That Have No Answers
The Innovation Strategy Office seems tohave a diverse group of members, withsome members who have BA
experience.
Minami I participated in the 2017
Next-Generation Shop project and was
involved in the development of 3D smart& try. I then took up a post in the
Innovation Strategy Office in September
2020. Before that, I worked in retail for a
total of nearly 10 years, including three
years as a BA at retail locations andseven years as a BA trainer. When I
started to question my future career insales, I heard about this project andthrew my hat in the ring.
Takayama I transferred to this teamaround the same time as Ms. Minami,
using the open recruitment system. For
the past 10 years since I joined theCompany, I have worked in a lot of positions dealing with infrastructure as an
in-house system engineer for the IT
Supervising Division, such as in ourCustomer service using avatars
Ava.Counseling Parler
An avatar that mimics the facial expressions and movements of a remote BA, providing real-time counseling tocustomers on their innerwear selection. Currently, our BAs
serve customers remotely while in the office, but in the
future we are considering remote work from home.

factory, planning and design, production
materials, sales and logistics, and inhouse server networking. When I lookedback at my skill set and future careerprospects, I thought it was the exact righttime to step up.
Miyashita I also had about 17 years ofexperience in retail, then transferred tothis team through open recruitment. I
took on this challenge because I wanted
to use the sales skills I had cultivatedover the years, but I honestly felt I was in
the wrong place at the beginning of thetransfer. At that time, Ms. Shinoduka told
me that I should use the strengths of mysales experience, which led me to lookat myself in a new light and recognizethat my perspective from being in close
contact with customers was one of mystrengths.
Shinoduka Our current team is adiverse group of people who came
together to create a good service for ourcustomers. We are tasked with creating
something for which there is no correct
answer. In these circumstances, thepresence of people with varying career
paths allows for various approaches toour challenges. For example, when discussing how the user interface should bedesigned or what the service plan shouldbe, we can think more sincerely about
what is important regarding customer
comfort, operability, and various otherpoints depending on one’s point of view.
Takayama Precisely because of thedifferences in everyone’s backgrounds,

Tatsushi Takayama
Joined in 2010
Innovation Strategy Office, Section Chief of Business
Promotion Section
Wacoal Corp.

their focal points differ. While I tend to
focus more on the developer’s perspective, such as how the system works andhow it looks when used, Ms. Minami and
Ms. Miyashita use their BA experienceto think about how customers would feeland how BAs on-site could help themwith our services. There is a great sensethat something better is being created bydiscussing such differences inviewpoints.
Miyashita I have the advantage ofbeing involved in the field as a BA.
However, when I came to this team andlearned about systems and details about

I N T E G R AT E D R E P O R T 2 0 2 2

17

Dialogue 02“correct” measurements but to find whatmakes customers comfortable. Insteadof making recommendations based on
objective numbers alone, the BAs makesuggestions based on data tailored toeach person’s preferences. I believe that
personalization can truly only be completed by human hands.
Minami Another strength is the history of the Company, from its founding
to now. The Company has a history of
more than 70 years. The fact that
Wacoal, with this kind of history, is theone taking on digital technology brings
some peace of mind.
the service, I began thinking about how
to communicate these kinds of system
details to the BAs and how we could
communicate these kinds of details tocustomers. I feel like my thought process
has changed.
Minami I was surprised to see somuch respect for BA opinions from Ms.
Shinoduka. Through developing 3D
smart & try, I realized the importance ofthe customer’s viewpoint in any service.
I realize that this is something so obvious, but it can easily slip away from yourmind when you are in-house for so long.

Shinoduka The end goal at a lingerie
store is to find the perfect innerwear forcustomers. No matter how accurately
measurements are taken with amachine they may not find that perfectpair. The BA is there to blend the objective numbers the machine gives and thecustomer’s preferences. When trying ona size suggested by the machine basedon the numbers, some people may find it
tight, while others find it a little loose
fitting. The goal is not to pin down the

The Essence of Wacoal in
Innovation
Are there any strengths or weaknessesof Wacoal that you have noticed in the
Innovation Strategy Office?
Miyashita When I was working as a
BA at a retail location, I would sometimes wonder if BAs would no longer beneeded in the future when I heard theword “digital.” When I became involved
with this project, I realized that Wacoal
was trying to utilize digital technology
to enhance its “people” power, one of its
great strengths. In implementing digitaltechnology, the team focused on how
exactly we should go about leveraging
the power of Wacoal’s talented people.

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I N T E G R AT E D R E P O R T 2 0 2 2

Chisa Minami
Joined in 2010
Innovation Strategy Office, In charge of Business
Promotion Section
Wacoal Corp.

Shinoduka Yes, that is right. To
integrate cutting-edge and difficult-tounderstand digital technology into daily
life, it is essential that people feel comfortable with the service. I believe thatthe sense of trust we have built up withcustomers for the Company contributes
to our customers’ sense of security.
Takayama I see Wacoal’s earnestness
as both a strength and a weakness. For
example, we tend to be excessively cautious when trying out new ideas. While
this may feel safe, we do not often just try
things out to see how the customers
respond. However, I think it is very
important to actually see how customers
react to the product in the market rather
than just making predictions from thearmchair. It is not good to delay decisions
for the sake of safe bets.
I feel that we must also promote a corporate culture in which failures can be seen
as building blocks to success.
Shinoduka I feel a challenge for
Wacoal is the ability to translate ideas
into economic value, or in other words,
the ability to build a growth story as abusiness. Even with solid service, wecannot continue to provide the service
unless customers make purchases andwe make a profit. It is essential for us tocreate a sustainable business model that
our customers feel is valuable and worth
the price.

CREATING EXPECTATIONS

Gaining Competitive Data throughLinking the Relationship between
the Body and Mind

Shinoduka First of all, it is necessary
to organize the aptitudes of the current
personnel and the abilities we seek.
Many companies tout an overall worker
shortage, but often there is no recognition of what actual skills are necessary
to achieve their goals. Wacoal has
employees who are enthusiastic, but I
cannot so eagerly say that it has anenvironment that allows them to makethe most of their strengths. Performancevaries greatly when goals are given andthings are expected of the employees. I
believe that we need an environment
where there are expectations and opportunities for many to demonstrate theirabilities.

There has been more and more centralization of customer data recently. Whatvalue do you think Wacoal can offer tocontinue being the consumer’s choice inthe future?
Shinoduka We have made progress incentralizing customer data, but we have
yet to see a connection to the value we
provide to our customers. When using
this kind of data, we believe that nomatter how good the data is, it is meaningless unless it comes back to enrich
the lives of our customers. Wacoal storescustomers’ physique measurement data.
There are not many places where customers are willing to entrust their measurement data. Obtaining such valuable
data is a huge advantage at this stage—an advantage distinctive to Wacoal. I
think the big challenge is how we canleverage these advantages and convert
them into customer value.
Takayama Business related to physique measurement data is not yet
mature in market terms, with no real big
successes in the area, making it a kindof blue ocean situation. Beyond that lies
broad business expansion, including in
the context of personalization. The
Innovation Strategy Office sees many
possibilities for combining this datawith various solutions.
Miyashita I also think it would be ideal
to use measurement data to enrich ourcustomers’ lives. My hope is that
Wacoal’s value comes from putting
ourselves in the customer’s shoes, digging deeper into what they want andwhy they use the products they use,
enabling us to make valuable and optimal proposals for them.
Minami If we can build a solid business model that utilizes measurement
data, I am sure that the sales ability of
BAs will become an advantage, and I feelthat the way BAs work can be expanded
even further.

Seiko Miyashita
Joined in 2003
Innovation Strategy Office, In charge of Business
Promotion Section
Wacoal Corp.

Shinoduka The most important thingis what the customer values. In this
rapidly changing world, we cannot
assume that what is valuable now will
have the same value 10 years from now.
The mission of the Innovation Strategy
Office is “Creating the norm for the
future.” Our products and services themselves must constantly evolve in order
to continuously provide value to thelives and livelihoods of our customers inthat particular period of time. Therefore,
it is important to consider how we cancreate a system that constantly evolves.
In addition to physique measurement
data, we believe it is important toacquire customers’ personal information
to further create value that will give us acompetitive advantage. What does eachcustomer want to become? What problems do they face? What are their concerns? What are their goals? By
approaching these points, we can find apath toward a value proposition only
Wacoal can provide.

Developing Human Resources
through Dreams and Expectations
As a leader of digital transformation
promotion, what are your thoughts on
securing and training human resources
for the Wacoal Group?

What do you think about your own rolein increasing the number of people who
can enhance the customer experience?
Shinoduka I have three different roles
that I play. The first is to dream more
about the future that Wacoal can bring tolife. If I have grand dreams of Wacoal
creating better products and services orwhat more can be achieved, I am certain
there are many out there that can demonstrate their abilities and make thesedreams come true. My second role is tohold high expectation for my team. As I
mentioned, people tend to grow morewhen someone expects them to. I havebeen there myself, and I feel it is important that we set expectations for eachother’s potential. My third role is to keepon learning. When you move up to higher
positions, you need to show others what
you are going to learn next and how youplan to grow. I believe if you want to
expect others to grow, you must firstgrow yourself. This is something I say tomyself to keep me going. I do not want tostand at the top of my team. I want to beright there in the middle, worrying andthinking together and running toward
solutions with my team members.
Wacoal has a diverse workforce. In lightof everything I mentioned, in order todraw out individual abilities and linkthem to results, we will contribute tostrengthening our human talent andfostering a culture of challenge.

I N T E G R AT E D R E P O R T 2 0 2 2

19

Dialogue 03
Creating a “Global Wacoal Group” for a New
Era by Demonstrating Established Advantages,
Local Capabilities, and a Consistent Philosophy
VISION 2030 positions the overseas business as an essential driver of the Group’s growth.
What should we emphasize and what do we need to do to achieve global expansion and become a “Global Wacoal
Group”? Here, we hear from several members involved in our overseas business.

Katsuya Hirooka
Corporate Officer and Head of Corporate Planning
Department
Wacoal Holdings Corp.
Katsuya Hirooka joined Wacoal in 1991. He has
worked in the overseas business for 12 years,
since 2003. He has worked as a director in Hong
Kong, the United States, and the United Kingdom,
and took the post of head of business management at the Global Division in 2015. He has held
his current position since April 2021. He is responsible for budget control, finance, and businessplanning for the entire Wacoal Group.

Takashi Watanabe
Head of Business Promotion Department,
Global Division,Wacoal Holdings Corp.
Takashi Watanabe joined Wacoal in 1994. After
working in strategic planning and product sales
for Wing, he held the position of president of
Wacoal Malaysia Sdn. Bhd. for five years from2013. From 2018, he was general manager of
Directly Managed Merchandise Sales for Retail
Business Headquarters and has held his current
post since April 2022. He is working to promotemarket expansion in countries around the world.

Takehiko Yonekawa
President of Wacoal Singapore Private Limited
Takehiko Yonekawa joined Wacoal in 1991. After
serving as president of une nana cool Corp. andgeneral manager of the Prestige Sales
Department, he took his second post in Hong
Kong in 2019 as president of Wacoal International
Hong Kong Co., Ltd. From April 2021, he concurrently served as president of Wacoal Hong Kong
Co., Ltd. and head of the Business Promotion
Department, Global Division. He took up his
current post in April 2022. He is also responsible
for the Asia Sales Headquarters.

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I N T E G R AT E D R E P O R T 2 0 2 2

CREATING EXPECTATIONS

Expanding to the World fromthe 1970s with the Thought of“What Wacoal Can Do”
First, please tell us about the­characteristics and history of Wacoal’s
overseas business.
Hirooka Koichi Tsukamoto, thefounder of Wacoal, made his first overseas inspection tour in 1956, shortly after
the Company was founded. After returning to Japan, Tsukamoto set up a longterm strategy called the One Phase
Every Ten Years 50-Year Plan to realize
his dream of creating a “Global Wacoal.”He planned to pioneer the domestic
market in the 1950s and establish himself in the domestic market in the 1960s.
Afterward, he planned to expand to theoverseas market in the 1970s and thenestablish himself in the overseas market
in the 1980s. He then planned to realize a“Global Wacoal Group” in the 1990s. Inline with his plans, we established joint
ventures in Thailand, South Korea, andTaiwan in 1970 to start our overseas
business. We next expanded into the U.S.
and Chinese markets in the 1980s,
moving forward to Europe in the 1990s
to become a global company. At thesame time, we expanded our manufacturing bases in the Asian region.
This plan reflects Koichi Tsukamoto’s
desire to create a peaceful world where
women can play an active role throughbusiness. Wacoal’s basic policy for overseas expansion is to strive for coexistence and co-prosperity with eachcountry and region based on mutual
trust, which is also part of theCompany’s philosophy, and to establish
locally led management. “What can
Wacoal do for your country?” We always
keep this in mind when entering newmarkets—­creating culture throughcorporate action, not just profit. To be acompany that contributes to the region’s
development and aims to grow together
with the region’s people. We have promoted our overseas expansion withthese convictions in mind.
What is the current scale of businessaround the world? Also, how do you feel
about the Wacoal Group’s strength inoverseas business?
Watanabe We sell our products inmore than 50 countries and regions
worldwide. The Group’s overseas sales,
including nonconsolidated joint ventures in Thailand, South Korea, Taiwan,
and others, exceed ¥100 billion. In addition, overseas sales on a consolidated
basis are approximately ¥60 billion(fiscal 2022), with a breakdown ofroughly ¥40 billion in Europe and theUnited States and about ¥20 billion
in Asia.
Yonekawa I think our strength lies in
our ability to share values as a group. As

Mr. Hirooka mentioned, we still share
the basic policy of overseas expansion,
which is to “seek coexistence and coprosperity with the countries andregions in which we operate” and “aim toestablish management led by the local
community.” Another characteristic andstrength of the Company is that we
carry out marketing for each country
and region and independently develop
and sell products.
Watanabe Body types differ dependingon the country or region, and preferences in design, color, and fitting also
differ. The fact that we have created abusiness model for each area while
meeting local needs is a great strength.
Yonekawa This is the opposite of the
SPA (specialty store retailer of private
label apparel) business model of sellingthe same product worldwide. Also,
although there are some exceptions, wehave only dispatched one to two
employees from Japan for each region.
One of our most significant distinctions
is our ability to operate with cooperationfrom local employees.
Hirooka Yes, that is right. Many local
employees share Wacoal’s values andideals and take pride in making them areality. I have always felt that this was
one of our great strengths from the time
I was overseas. I believe this results fromour past dispatched employees who

Defining a “Global Wacoal Group” for VISION 2030
We continue creating new
All stakeholders have a highlevel of trust in the Group’s
products, services, and initiatives relating to social issues.

We develop on a global scalecustomer experiences with

with a competitive edge by

our innovative, high-quality

making full use of the Group’s

products and services, andhuman resources, assets,

thus continue enriching andknow-how, and networks.

beautifying the lives of ourcustomers around the world.

Our employees all around theworld understand the Group’s
goals and mission and work
to make them a reality without being bound by conventional thinking or the past.

I N T E G R AT E D R E P O R T 2 0 2 2

21

Dialogue 03
firmly held to Wacoal’s philosophy andtrusted the local people to nurture thebusiness.

Leveraging Strengths andWorking Closely Together
to Achieve Global Growth
Along with VISION 2030, you have put
together a definition for a “Global
Wacoal Group.”
Hirooka Many of the things we originally wanted to accomplish to meet thedefinition of a “Global Wacoal Group”
have already been achieved. Thereof,
we have defined the next stage we aim
for with the formulation of VISION 2030.
Our newly defined goals include not
only business growth but also building
relationships with stakeholders, including local communities and customers.
When I was first stationed overseas in2003, the sales ratio of the overseas
business was about 10%. As a result of
the steady growth of our subsidiaries,
sales in the overseas business haveexceeded 30% of overall sales. In the
future, we will be entering a stage ofworking to strengthen horizontal cooperation among our subsidiaries andincreasing the presence of the Wacoal
Group around the world while demonstrating our comprehensive strengths.
This is the intent of our new definitionof a “Global Wacoal Group.”
In the overseas business, what kind ofcustomer value do you think only the
Wacoal Group can provide?

each country and region. In addition, as
digitalization advances, methods ofcommunicating with new customers arealso evolving and and we are leveraging
Wacoal’s strengths, such as 3D smart &try and the mybraFit™ application
released in the United States. It is
impossible to survive globally unless weconstantly provide updated products
and services at a high level in responseto changes in customer needs.
Yonekawa I think the keyword for
growth is “personalization.” As Wacoal
develops businesses rooted in eachcountry and region and conducts marketing and product development inthose regions, our strength lies in developing and providing products that fit
local customers’ tastes and body shapes.
Suppose we combine digital services
such as 3D smart & try and the
mybraFit™ application with communication with customers at retail locations
by sales staff who understand Wacoal’s
philosophy. In that case, we could provide personalized customer experiencevalue that matches the needs of individual customers. I want to maximize
customer value by pursuing value that
other companies do not have.
How will you utilize the know-how andnetwork you have cultivated to achieve
global growth? Also, what do you think
about the role that the Global Division
should play?

Watanabe The strength of Wacoal’s
manufacturing lies in its ability to balance functionality and fashion, based on
primary research conducted by the
Wacoal HUMAN SCIENCE RESEARCH &DEVELOPMENT CENTER. Wacoal’s commitment to quality through production
at its factory and the customer service
provided by trained sales staff are both

Watanabe At the Global Division, we
coordinate initiatives that individual
subsidiaries cannot implement by
quickly spreading and applying thelatest information and examples ofsuccess from around the world. In Asia,
the Global Division also plays a role insupporting horizontal cooperation
among countries.
Looking ahead, the Global Division
will be emphasizing the following two
initiatives. The first is to strengthen

distinctive features of Wacoal. Anothercharacteristic of Wacoal is its ability torespond flexibly to the different needs ofbranding on a global basis. Currently,
brand recognition is still low, so wewould like to actively invest in raising

22

I N T E G R AT E D R E P O R T 2 0 2 2awareness of Wacoal among more
people around the world. The second is
support for communication with customers in each country and region. In
Japan, we are currently promoting acustomer experience strategy aiming tobuild deeper, broader, and longer relationships with our customers. However,
our overseas strategy is not quite up to
this level. While actively utilizing digitaltechnology, we would like to provide thenecessary support to develop strategies
to connect with customers in eachcountry and region.
From this year, you have established aheadquarters system for sales in Asia,with Singapore as a hub. Whatchallenges do you face when considering reinforcing the sales structure topromote growth in the Asian market?
Yonekawa The Asian headquarters
covers five countries and regions: Hong
Kong, Singapore, the Philippines,
Vietnam, and Malaysia. Due to the small
business scale of each of our subsidiaries, we have not been able to make thenecessary investments so far, and poor
business efficiency has been a problem
in the past due to such individual
investments. With this in mind, we set
up headquarters in Singapore and areworking on standardization to improvebusiness efficiency. For example, thetypes of popular products in Hong Kongand Singapore are similar, such as theprice range and size composition, so weare standardizing products between
these regions and conducting joint
marketing. To bolster e-commerce,
which is expected to grow in the future,
we are working together on strategies

CREATING EXPECTATIONS

for growth in each country after
considering each country’s and region’s
potential, such as for developing acommon e-commerce platform.

A Global Corporate Message witha Promise to Contribute to an Era
of Diversity
In June 2022, you announced a new
global corporate message: “Comfortable
inside. Confident outside.” Please tell us
your thoughts on this message.
Hirooka This global corporate message is the Wacoal Group’s promise to
stakeholders, including customers andlocal communities. The message
expresses our desire to contribute tohelping each customer live a fulfilling
life with self-confidence by providing
products and services that make eachcustomer feel comfortable. We believethat the mission of the Wacoal Group is
to contribute to the realization of customers’ individuality, including theirinner selves.
Yonekawa I believe this message also
expresses the product characteristics of
Wacoal’s core business of innerwear. In
that sense, I think it fits Wacoal well.
First, we will spread this message toemployees in every country. I believe it
is essential to convey not only themessage but also the background behindthe message and the future role of
Wacoal’s overseas business.
Consumer values such as body­neutrality and body positivity arechanging globally. How do you keep up
with changing consumer expectations?
Watanabe Wacoal has been proposing
products in response to the different
needs of customers in each country andregion, but I think it will be even morecritical in the future to accept different
values actively. We have not yet fully

promoted diversity and inclusion in thetrue sense of the word, and we cannot
say we are some breeding ground of
successive ideas born from variety.
We must grasp customers’ needs without being bound by conventional values
and develop budding products and services that customers are not aware theyneed yet.
Yonekawa Up until now, if anything,
we had an ideal body shape in mind andprovided products, explanations, andcustomer service to get as close to thatas possible. Instead, I believe that providing products and services that matchthe mind and body of each customer willbe the source of future growth.
What role do you think you should play
to provide products that allow customers worldwide to live a fulfilling life intheir own way and realize growth as acompany?
Hirooka Our goal to become a “Global
Wacoal Group” and achieve VISION 2030
reflect, our strong will. These describe themilestones and goals for embodying andrealizing the management philosophy.
These goals are a must for the Company.
VISION 2030 is a plan through fiscal 2031.
If all goes according to plan, the overseas
sales ratio (including joint ventures)
should exceed 50% in fiscal 2028.
I have been working overseas for a longtime. I have been wondering what kind of“Global Wacoal” the founder thought ofduring his time. I believe that founder
Koichi Tsukamoto’s real intention behinda “Global Wacoal” was to create a world
where not only women but all people cansmile and live active lives. If we can makethe world he dreamed of into reality, theoverseas sales ratio will inevitably growsince overseas countries have larger
populations and GDPs than Japan. For
that reason, an overseas sales ratio of 50%
is an indicator that should be achieved assoon as possible.

As the person in charge of the Corporate
Planning Department, my role in realizing
VISION 2030 is to instill the entire Group’s
fundamental management philosophy
and policy. I want to be actively involvedin this. Another significant role I have isthe distribution of the Group’s management resources. After taking a step backand looking at the big picture, I would liketo make optimal resource investments,
such as in human resources and funds,
and work to expand our overseas businessand achieve VISION 2030.
Watanabe The Japanese market is asmall segment of our business.
Considering the market size, we need tofocus more aggressively on sales overseas than in Japan. While there are stilllarge markets worldwide, some areas
have not been fully explored. There aremany areas where customers are unfamiliar with Wacoal. As the Global
Division, we would like to support global
growth by acting as a hub between subsidiaries—sharing information, andproviding necessary know-how.
Yonekawa I believe expanding sales in
the five Asian countries and regions I
oversee from headquarters is my toppriority. I want to create a system andenvironment where I can work acrossthe areas I am in charge of and solve
various issues as a group. We will contribute to the growth of the entire Groupby returning the know-how we learn
here to other overseas subsidiaries andJapan.

I N T E G R AT E D R E P O R T 2 0 2 2

23

Dialogue 04
I dentifying Material Issues by Taking Diverse
Opinions into Consideration
Four employees have been promoting the formulation of material issues as part of the Executive Office of the Sustainability
Promotion Project. We took a look back at how discussions progressed in teams divided into the themes of customers, ­employees,
the environment, society, and governance.

For Customers, We Need to Keep
Meeting Them Face-to-Face. For thethe Environment, We Need to Work
Together with Our Customers
You put together a list of material issues
to address by 2030. What process did
you use to identify material issues?
Yamada We went through two phases.
First, six leaders, including corporate
officers and the Executive Office, createda foundation for the future vision andmaterial issues. Afterward, mid-career
members nominated as leaders andyounger employees from open recruitment joined in to hold discussions witheach team. As specialized knowledge
was required to identify governanceissues, we considered initiatives withthe leader, who is the head of the
Corporate Planning Department, andother nominated members.
How did the Executive Office organize
the discussions in each team?
Yamamoto (Kumiko) In the customer
team, which I was in charge of, wethought of how we could maximize thevalue of customer experience and growTakato Yamada
Joined in 2007
Section Chief, Business Planning Section,
Business Planning Department
Wacoal Corp.

24

I N T E G R AT E D R E P O R T 2 0 2 2

as a company. We narrowed it down tothree points from the perspective ofachieving both goals simultaneously.
Our first point is the “Enhancement ofcustomer experience value by pursuing
personalization.” This is to increasecustomer experience value by providing
services and products that suit eachindividual. To that end, we are trying toconnect with our customers, learn about
them, and connect them to our business.
Our second point is “Endeavoring to
expand business areas.” We need to use
our knowledge and technology to support a broader range of people from all
angles to realize their best selves. Our
third point is the “Deepening of productquality and building of service quality.”
We take great pride in our high level ofquality control. However, in anticipationof the future expansion of our businessareas, how should we tackle the qualityof things other than products, such asservices and customer service? We
concluded that we must review what
quality means in the present times.
How about the environment team?
Yamamoto (Kanako) In the environment team, we decided on the “Promotionof business activities that reduce environmental impact.” We were able to share
the recognition that we must reduce our
impact on the environment to realize asustainable society and for Wacoal to
grow. On top of that, the environmental
awareness of our customers is changing.
This led to a less-than-difficult process ofidentifying the issues. However, although
we understand that doing something forthe environment is essential, it was challenging to think specifically about what
Wacoal could do to contribute. The idea ofall of this was that we will not be able to
do anything unless we work together
with our customers. In the end, we
included a specific item in materialitythat we must work to foster

Kumiko Yamamoto
Joined in 2013
Brand Management Division 1,
Salute Brand Team(At the time of the interview, Business Planning
Section, Business Planning Department)
Wacoal Corp.

environmental awareness among both
employees and consumers.

Employees Who Promote
Individual Growth fromthe Bottom Up to Change Society
Ms. Tani, you are on the society team.
Tani Yes, I am. The team considered
providing social value as the focal pointof identifying problems. To establish
new material issues, we started bylearning how Wacoal’s existing businesses may have been providing social
meaning and value from different perspectives. This helped us understand theCompany better, with many of theyounger members commenting thatthey did not know the Company didthese sorts of things.
The conclusion you ended up on was
the challenge of the “Promotion ofco-creation innovation to solve social
issues.”Tani Among our topics, the most indepth discussions we had were on“Contribution to the improvement of
women’s QOL” and the “Promotion ofdiversity and inclusion.” Regarding
improving quality of life, the main pointof discussion was the deliberate use of

CREATING EXPECTATIONS“women.” On the one hand, there is theopinion that it is not appropriate to use
the word “women” when striving tocreate a world where everyone can live
comfortably. On the other hand, we
discussed that women are our focus
precisely because Wacoal’s core business is creating innerwear for women.
Regarding the promotion of diversity
and inclusion, we would like to make asociety where it is natural to accept
diverse values and people to realize asociety where everyone can play anactive role in their own way. We talked
about increasing the number of diversity
and inclusion experts from within the
Company by first conducting in-housetraining.

Haruna Tani
Joined in 2012Manager, Sustainability Promotion,
Corporate Communications Department
Wacoal Holdings Corp.

“Employees” feels like a familiar theme
in human resources development,
organizational development, and health.
Yamada First, we can talk abouthuman resources development. In thisday and age, it is common to change
jobs or work after retirement age. In
such an environment, regardless of age
or position, it is important to be selfdisciplined to improve your abilities andbuild a solid career outside of Wacoal.
We believe that the growth of every
employee will eventually lead to anorganization that can produce results.
Next is organizational development.
While the Mission and Companywide
goals are shared among the Company,
departmental and individual goals are
not available for everybody to see.
Therefore, in promoting this material
issue, we thought that we should shareeach organization’s mission and goals toadequately reflect on whether we haveachieved them.

We Must First Change Ourselves
to Solve Problems
Plans to achieve VISION 2030 are
becoming a reality. What kind of progress do you see yourself making in the
future?
Yamada Our focus on pushing things
forward can be broken into three majorparts. We will be promoting customerand employee-related issues in conjunction with the business plan of eachbusiness division in the Management
Issues Review Meeting. The
Sustainability Committee will manage
the progress of the issues of the environment and society, while governance will
be taken up by the Board of Directors. We
have also decided to establish two projects under the Sustainability Committee.
One is the Project to Promote Awarenessof the the WACOAL Way. To increase thepower and engagement of our employees, we will work out plans to saturate
and implement the new Mission decided
through the Sustainability Promotion
Project throughout the Group. The otherproject is the Project to Improve
Women’s QOL (quality of life). Wacoal
participates in a wide range of activities
to promote breast care, from breast
cancer screening awareness to postsurgery support. Still, the problem is thatthese activities are not coordinated very
well overall. In addition, we will be gathering the people in charge of eachdepartment to discuss specific initiatives Wacoal can take to ensure that as
many women as possible are physicallyand mentally healthy and radiant.
How will you be tackling challenges as
you move forward?
Yamada Some KPIs for material issues
have been set while others are currently
being decided. I think it is essential tobreak these items down into individual
goals. I took up a post as section chief in
April 2022 and am involved in setting
goals for the members. By increasing thenumber of members who can reflect the
departmental goals for achieving material issues in their individual goals andtaking action, I would like to connect
this to the growth of every employee.

Yamamoto (Kumiko) I feel that toaddress our material issues, we need tounderstand changes in the awareness of
consumers. To properly show what kindof future Wacoal will create, I believe it is
my role to collect information on consumer and world changes based on
regular surveys.
Yamamoto (Kanako) It is essential not
only to understand and be aware but
also to act. For this reason, I think everyone needs to “make it their own.” It isespecially difficult to find a connection
between our daily actions regarding
society and the environment. First, I
would like to increase the number ofpeople who can take the first step bycreating a culture where they will takeon even the most minor things with achallenging spirit. I would like us to give
each other affirmation for these kinds ofactions. I want to create a company
where people can adequately express
positive opinions, not just negativity andcriticism.

Kanako Yamamoto
Joined in 2010
Manager, Sustainability Promotion,
Corporate Communications Department
Wacoal Holdings Corp.

Tani Around 50 employees wereinvolved in this project out of approximately 20,000 total employees in the Group.
Although we gathered 50 employees, one
might say “only” 50. Some of the other
employees may feel a disconnect with ourdecisions since they were not here to makethem. Our Mission and material issues canonly be achieved through the cumulative
actions of each individual. I want to makesure that more people are aware of this. To
that end, I would like to spread the positive
power of those who are consciously
implementing it and those who aretrying to change themselves widely
throughout the Company.
I N T E G R AT E D R E P O R T 2 0 2 2

25

Identifying Material Issues with a View to 2030
While the world’s population as a whole is rising, some countries are seeing declining birth rates and aging societies. These­factors, along with the ongoing digital revolution, globalization, and the intensification of climate change and human rights issues,
are making the future increasingly difficult to predict. It is precisely in these unpredictable and uncertain times that we felt it
necessary to reaffirm the Group’s management philosophy. Further, we will clarify the social and environmental issues that wemust address by 2030 and work back from there to establish what we as a company must accomplish at this point in time.
In order to realize VISION 2030—the Group’s medium- to long-term management strategy framework—while evolving our longcultivated strengths, such as research, planning, and sales, we conducted an analysis of material issues based on social and environmental issues to be addressed, as well as business growth. As a result, we identified five targets and 11 material issues. We
arrived at this decision by gaining insight into the business challenges and social and environmental issues we expect to face by
2030, while taking into account macro trends and the requests of various stakeholders.

Targets

Customers

Maximize the value
provided to customers

Employees

Achieve the growth ofeach of our employees
and establish a highly
rewarding organization

Material Issues

1	Enhancement of customer experience value by pursuing
personalization
2 Endeavoring to expand business areas
3 Deepening of product quality and building of service quality

4	Growth into human resources who can expand theirpotential and have confidence, pride, and success5	Building of an organization that can demonstrate great
results through co-creation and collaboration
6	Continuous improvement of employees’ health andhealth awareness

Environment

Preserve theenvironment globallyfor future generations

7	Promotion of business activities that
reduce environmental impact

Society

Realize a society inwhich everyone plays
an active role in theirown way

Governance

Enhance governancetoward the realizationof sustainable growth26

8 Promotion of co-creation innovation to solve social issues

9 Implementation of highly transparent management
10 Strengthening of the risk management system
11	Continuous improvement of profitability and capitalefficiency

I N T E G R AT E D R E P O R T 2 0 2 2

Contribution to SDGs

CREATING EXPECTATIONSThe Process of Evaluating and Identifying Material Issues

STEP 1 January to February 2021

Creation of a List of Issues to be Addressed Based on Dialogue with andRequests from Stakeholders

Referenced Frameworks and Guidelines
GRI Standards
SASB Standards
ISO 26000
Sustainable Development Goals (SDGs)
The Ten Principles of the UN Global Compact
OECD Guidelines for Multinational
Enterprises
Task Force on Climate-related Financial
Disclosures (TCFD)

STEP 2 March 2021

Led by the Supply Chain Environmental Project—the predecessor of the Sustainability
Promotion Project—an extensive list of business, environmental, and social issues
was compiled while referencing international frameworks and guidelines, such as
the GRI Standards and the Sustainable Development Goals (SDGs), as well as macro
trends in our various fields of expertise.
Engaging in Dialogue with Stakeholders and Receiving Their Various Evaluations andRequests
Dialogue with investors and other stakeholders at investor relations and business briefing
sessions
Dialogue with nongovernmental and not-for-profit organizations such as CDP
Requests made in various ESG surveys

Discussions between Management and Outside Experts
Discussions were held between outside experts and management regarding the
aforementioned list of issues. After identifying issues with a high level of relevanceto our businesses and assessing their levels of importance, 18 material issues wereidentified across six core themes

STEP 3 April to June 2021

Discussions with the Next Generation of Management Candidates
The material issues assessed in March were once again discussed by the
Sustainability Promotion Project (with six leaders present), and material issues for2030 were examined and reidentified

STEP 4 July to November 2021

Discussions with Young Employees
Discussions were held by designated and non-designated members of the
Sustainability Promotion Project (with six leaders present) on specific initiatives
and KPIs for the reidentified material issues for 2030

STEP 5 December 2021 to January 2022

Identification of Material Issues
Discussions were held with management, including external directors, on specificinitiatives and KPIs for the material issues discussed by the Sustainability
Promotion Project. Five targets and 11 material issues were identified as indicators
to achieve business growth and a sustainable society by 2030

Method for Assessing Material Issues(1) Identify material issues in terms of their level ofimportance to society and stakeholders and theirimportance to business growth
Extremely
important

Extremely
urgentImportance tosociety andstakeholders

Importance(2) Identify material issues based on
their importance to business growth andlevel of urgency

Level of urgency

Importance tobusiness growth

Extremely
important

Urgency /ImportanceImportance tobusiness growth

Extremely
important

I N T E G R AT E D R E P O R T 2 0 2 2

27

Material Issues to be Addressed by 2030
Customers: Maximize the value provided to customers
Material issues

1

2

Enhancement of customer experience value
by pursuing
personalization

Endeavoring to expand
business areas

Concrete efforts toward theresolution of material issues
Increasing of customer connections andlearning from them to wow othercustomers
Creation of products that exceed
expectations and are loved

Tackling of challenges in new areas tosupport customers from every angle

3

Pursuit of quality control systems andquality levels demanded by the times

Targets

Increase in the number of customers with connections to the
Wacoal Group
Increase in the number of people experiencing Wacoal’s uniqueservices that enhance the customer experience
Revitalization of the innerwear business by promoting the development of new products and services that utilize customer data
Increase in growth and profitability in businesses other than
women’s innerwear
Creation of new business to contribute to well-being
Expansion of internal resources into new fields

Achievement of global growth toprovide inspiration to customers
around the world

Deepening of productquality and building ofservice quality

KPIs (by 2030)

To be considered in fiscal 2023
and announced during fiscal
2024

Overseas business expansion
Continuous monitoring of product quality and implementation of
improvement activities
Maintenance and improvement of the quality of digital andover-the-counter services

Employees: Achieve the growth of each of our employees andestablish a highly rewarding organization

28

Material issues

Concrete efforts toward theresolution of material issues

4

Growth into humanresources who can
expand their potential
and have confidence,
pride, and success

Growth into of human resources thatproactively enhance self-proficiency
and take on challenges with enthusiasm, regardless of generation or position

5

Building of anorganization that candemonstrate great
results throughco-creation andcollaboration

Fostering of an organizational culture inwhich people from various positions cancooperate and achieve their missions

6

Continuousi­ mprovement of
employees' health andhealth awarenessImprovement of employees’ mental andphysical health

I N T E G R AT E D R E P O R T 2 0 2 2

KPIs (by 2030)

Targets

Enhancement of initiatives geared toward self-motivated career
design and skill improvement
Nurturing of human resources and creation of an environment inwhich employees can take on challenges with enthusiasm
Development of a work environment in which people from diverse
backgrounds can work together
Increase in the number of employees who can act with clarity on
what the Company should be and its mission
Improvement of employees’ productivity and mental and physicalhealthImprovement of health literacy

To be considered in fiscal 2023
and announced during fiscal
2024

CREATING EXPECTATIONS

Environment: Preserve the environment globally for

future generations

Material issues

7

Promotion of businessactivities that reduce
environmental impact

Concrete efforts toward theresolution of material issues

KPIs (by 2030)

Targets

Fostering of environmental awarenessamong both employees and consumers

Visualization of ecological activities in businessactivities

Achievement of a decarbonized society

Realization of a decarbonized society andreduction in CO2 emissions

1)	Zero in-house emissions (Scope 1 and 2)(domestic businesses)
2) Zero product waste (Wacoal Corp.)3)	Rate of environment-friendly materials usedof 50% (Wacoal Corp.)4)	20% reduction in supply chain emissions(Scope 3) (Wacoal Business (Domestic))

Promotion of waste reduction

Reduction of product disposal rate

Achievement of a society of thatrecycles resources

Increase in rate of environment-friendly
materials used

Note: For our overseas business, we plan to start by
tracking our own emissions (Scope 1 and 2) anddisclose our targets by the fiscal year ending
March 31, 2025.

Society: Realize a society in which everyone plays an active rolein their own way

Material issues

Concrete efforts toward theresolution of material issues

KPIs (by 2030)

Targets

Promotion of breast care activities
Contribution to the improvement of
women's QOL

Fulfillment of needs through products and services and development ofideas that contribute to improving women’s quality of life
Contribution to women’s quality of life through ongoing dialogue withstakeholders

8

Promotion of co-creation
innovation to solve
social issues

Promotion of diversity and inclusion

Promotion of respect for human rights
and CSR procurement activities

Promotion of in-house enlightenment activities to foster an­understanding of diversity-related issues such as gender

To be considered in fiscal
2023 and announced
during fiscal 2024

Promotion of dialogue and co-creation activities with external stakeholders to foster an understanding of diversity-related issues such as gender
Establishment and implementation of human rights due diligence andpromotion of human rights training
Expansion of scope of CSR procurement activities

Governance: Enhance governance toward the realizationof sustainable growthMaterial issues

Concrete efforts toward theresolution of material issues

KPIs (by 2030)

Targets

Implementation of Japan’s Corporate Governance Code9

Implementation ofhighly transparent
management

Maintenance and establishment of an
optimal corporate governance systemthat will improve effectiveness

Demonstration of the Board of Directors’ functions and promotion ofdiversity
Ongoing improvement of the system for the compensation of officers toincrease corporate value
Establishment of fair and motivating evaluation and compensation
systems

10

11

Strengthening of therisk management
systemContinuous
improvement of
profitability and capitalefficiency

Thorough compliance with laws andregulations and development of anorganization with high ethicalstandards

Prevention of inappropriate behavior in corporate activities and enhancement of compliance awareness among all officers and employees

Strengthening of organizational­resilience by steadily responding tobusiness risk

Review of selection methods and response policies for major risks,
promotion of information security measures for digital transformationand communication technology operations, and enhancement of thebusiness continuity plan

Execution of the management strategy
and clarification of roles and authority

To be considered in fiscal
2023 and announced
during fiscal 2024

Strengthened management of key performance indicators andverification of cost-effectiveness to improve the effectiveness of
medium- to long-term strategies
Implementation of business portfolio management to realize growthEstablishment of an executive structure for timely and appropriate
decision-making

I N T E G R AT E D R E P O R T 2 0 2 229

Sustainability

Response to Climate Change
At Wacoal, we believe that climate change, which has a profound impact on the earth and corporate activities, is both a risk to theGroup’s business as well as an opportunity to expand its business. Based on this belief, we are proceeding with measures to addressenvironmental issues and expand our disclosure of environmental information in our mission to realize sound corporate growth anda sustainable society.
Approach to Reducing Greenhouse Gas (GHG) Emissions In order to move forward with measures to realize a carbon-freesociety and firmly ensure the reduction of greenhouse gas (GHG)
emissions along the supply chain, we began calculating GHG emissions for the entire supply chain (Scope 3) of the Wacoal Business(Domestic) in 2021. Moreover, in addition to disclosing reduction
targets for Scope 1 and Scope 2 GHG emissions from our operatingbases in Japan in pursuit of our 2030 nonfinancial goals, in June
2022 the Company disclosed reduction targets for the aforementioned Scope 3 GHG emissions of the Wacoal Business (Domestic).
Environmental goals for 2030

P.31

GHG Emissions Reduction Process Currently, the Subcommittee for Carbon-Neutral, which operates
under the Sustainability Committee, takes the lead in reviewing
specific action plans for achieving GHG emissions reduction targets. In pursuit of our goal of realizing net-zero GHG emissions at allof our operating bases in Japan, we plan on installing solar power
generating systems at our distribution centers as well as graduallyconverting to the use of renewable energy at our existing operatingbases. Meanwhile, in order to reduce GHG emissions along the
supply chain, it is imperative that we work in unison with our
suppliers. We intend to develop an action plan and course of action
for reducing GHG emissions while urging our suppliers to do theirpart in helping to reduce GHG emissions along the supply chain.

Greenhouse Gas Emissions Generated by the Wacoal Business (Domestic)
In fiscal 2021, GHG emissions from the Wacoal Business (Domestic) decreased by 10% from fiscal 2020, due mainly to the­discontinuation of business activities stemming from the impact of COVID-19. Moreover, Scope 3 emissions account for a large­proportion of total GHG emissions from the Wacoal Business (Domestic) and roughly 90% of these emissions come from Category 1:
Purchased Goods and Services.
Coverage

Scope/category

CO2 emissions(CO2e-t)

Percentage of total
GHG emissions

Percentage change
from fiscal 2020(base year)

Operating bases, plants, and distribution centers in Japan

1,653

0.5%

–10.1%

Scope 2 emissions

Operating bases, plants, and distribution centers in Japan

4,158

1.3%

–11.9%

Scope 3 emissions

Wacoal Business (Domestic)

304,503

98.1%

–9.5%

Downstream

Upstream

Scope 1 emissions

Category 1

Purchased goods and services

273,758

89.9%–10.4%

Category 2

Capital goods

16,387

5.4%

21.3%

Category 3

Fuel- and energy-related activities not included
as a part of Scope 1 and Scope 2 emissions

1,091

0.4%

–14.7%

Category 4

Upstream transportation and distribution

2,871

0.9%

–18.5%

Category 5

Waste generated by operations

187

0.1%

–35.3%

Category 6

Business travel

1,073

0.4%

–70.9%

Category 7

Employee commuting

2,807

0.9%

5.1%

Category 8

Upstream leased assets

1,070

0.4%

2.9%

Category 9

Downstream transportation and distribution

2,803

0.9%

18.9%

Category 10

Processing of sold products

Excluded from scope of calculation——

Category 11

Use of sold products

Excluded from scope of calculation——

Category 12

End-of-life treatment of sold products

2,456

0.8%

–13.3%

Category 13

Downstream leased assets

Excluded from scope of calculation——

Category 14

Franchises

Excluded from scope of calculation——

Category 15

Investments

Excluded from scope of calculation——

Recognition as a CDP Supplier Engagement Leader

CDP is an international nonprofit organization that conducts research and analyses on the initiatives of companies and organizations aroundthe world to address climate change and other environmental issues and discloses the results of these assessments. The CDP’s Supplier
Engagement Rating assesses how companies work effectively with suppliers to resolve the issue of climate change. In 2021, the Group
engaged in CDP’s climate change questionnaire for the first time and was selected as a “B list” company.
Please visit our corporate website for details on how we work together with consumers to protect the
global environment through our business activities.
https://www.wacoalholdings.jp/en/sustainability/environment/efforts/

DISCLOSURE INSIGHT ACTION30I N T E G R AT E D R E P O R T 2 0 2 2

CREATING EXPECTATIONS

TopicResponse to the Task Force on Climate-related Financial Disclosures (TCFD)
In September 2021, the Wacoal Group announced its support for the recommendations of the Task
Force on Climate-related Financial Disclosures (TCFD). In addition, the Wacoal Group disclosed
information on the four thematic areas of governance, strategy, risk management, and indicatorsand goals in accordance with the TCFD recommendations on its corporate website in June 2022.

Disclosure of Four Items Based on TCFD Recommendations

Governance

In April 2022, the Group established the Sustainability Committee to promote sustainability management, solve social
issues, and achieve corporate growth through business. The Sustainability Committee regularly meets on the same
day as the Board of Directors and formulates concrete measures to address climate change issues, monitors progress,and evaluates achievements. The Board of Directors receives reports from the Sustainability Committee and gives
instructions regarding the Group’s policies and initiatives to respond to environmental issues. In addition, to promoteresponses to climate change issues, we have established the Subcommittee for Carbon-Neutral and the
Subcommittee for Resource Circulation as subordinate organizations.
The representative director, president, and CEO is responsible for the Board of Directors and the GroupManagement Meeting, the highest decision-making body at the business execution level, and is in overall charge of
the Sustainability Committee, which is chaired by the representative director, vice president, and executive officer.
The Group is conducting scenario analysis sequentially, starting with businesses for which data can be analyzed, toassess the impact of risks and opportunities related to climate change issues.

Strategy

Riskmanagement

Risks	The major risks affecting the Group's business, strategy, financial plans, etc., include the intensification of extreme
weather, such as storms and floods, and cost increases for resources such carbon and electricity.
Opportunities	
The Group is promoting environment-friendly activities, such as building a manufacturing and sales system in which
few products are discarded. In the future, we will continue to promote business activities with a low environmental
impact, aiming to achieve our environmental goals for 2030. As environmental awareness is growing among­consumers and society, we believe that business activities like these will be an opportunity to boost sales for the Group.

The Group sorts and evaluates risks related to climate change through the Sustainability Committee and its subordinate organizations, the Subcommittee for Carbon-Neutral and the Subcommittee for Resource Circulation. Monitoringand evaluation of achievements for risk management are also carried out by the Sustainability Committee and eachsubcommittee. Regarding the sorting and assessment of risks related to climate change, the Sustainability
Committee and each of its subcommittees, of which the representative director, president, and CEO is in overallcharge, examine both upstream and downstream direct operations and their impact on the entire Group from ashort- to long-term perspective and report the results to the Board of Directors, which is a higher-level organization.
Ultimately, it is a process to identify and assess the risks of climate change issues across the Group.
The Group has set its own environmental goals for 2030 to promote efforts to solve increasingly serious climate change issues
and realize a carbon-free society.
Environmental goals for 2030
(1) Z ero in-house emissions (Scope 1 and 2) (Domestic offices)
Gradually switch to renewable energy, aiming to achieve net zero in-house greenhouse gas emissions (Scope 1 and 2)

Indicatorsand goals(2) Z ero product waste (Wacoal Corp.)
Aim for zero discarded products and promote efforts to reduce the disposal of waste materials at plants(3) R ate of environment-friendly material used of 50% (Wacoal Corp.)
Increase the percentage of environment-friendly materials used in products to 50% by switching to recycled fibers and yarns, etc.
(4) 20% reduction in supply chain emissions (Scope 3) (Wacoal Business (Domestic))
Promote efforts with partner companies to reduce greenhouse gas emissions in the supply chain (Scope 3) by 20%
Note: For overseas business operations, we will start by calculating our own emissions (Scope 1 and 2) and plan to disclose the targets by theend of March 2025.

Scenario Analysis Based on TCFD Recommendations

In accordance with the recommendations of the TCFD, the Group conducted a scenario analysis on climate change in 2022. In the
scenario analysis, we examined countermeasures and identified risks and opportunities for Wacoal Corp., which has the highest
percentage of overall sales in the Group, in two hypothetical scenarios in which the global temperature increased by 2°C and 4°C.
The scenario analysis showed that while a rise of 2°C had some positive impacts, such as gaining support from environmentallyconscious consumers, transition risks, such as the introduction of carbon taxes, could have a negative impact on business. In addition,
it was found that a rise of 4°C could lead to physical risks, such as storms, floods, and other extreme weather, that could have a negative
impact on business.
The scope of scenario analysis will be expanded sequentially in the future, and we will continue making efforts to enable detailed
risk analysis for the entire Group.

I N T E G R AT E D R E P O R T 2 0 2 2

31

Sustainability

Human Rights Initiatives
Ever since its inception as a corporate entity, the Wacoal Group has never rested in its mission to further business management
rooted in mutual trust and respect for humanity. Wacoal’s purpose is to contribute to the everyday health and affluence of each andevery one of our customers through the products and services that we supply, effectively setting our sights on the realization of asustainable society. We recognize that all of our business activities must be grounded in the premise of unrelenting respect forhuman rights. True to this stance, we pledge to fully grasp and support international principles and standards, such as the United
Nations Guiding Principles on Business and Human Rights, as the minimum tenets and benchmarks to be maintained with regard tohuman rights.
Revision of Human Rights Policy 
The Wacoal Group has continued to engage in activities to promoterespect for human rights based on its basic policy on human rights
set forth in the CSR Basic Policy, which was established in 2013.
However, recognizing the need to promote even more Groupwide
efforts to respect human rights in light of the increasing awarenessof human rights issues and our corporate social responsibilities, in
April 2022 the Wacoal Group Human Rights Policy was revised anddisclosed both internally and outside the organization. Moreover,this policy now conforms to the United Nations Guiding Principles
on Business and Human Rights.** Guiding Principles on Business and Human Rights: Adopted by the United Nations
Human Rights Council in 2011, these guiding principles serve to protect individuals
who are at risk of serious harm from corporate activities.

The Wacoal Group Human Rights Policy (1) Basic Thinking
Ever since its inception as a corporate entity, the Wacoal Group has
never rested in its mission to further business management rooted inmutual trust and respect for humanity. Wacoal’s purpose is to contribute to the everyday health and affluence of each and every one of ourcustomers through the products and services that we supply, effectively setting our sights on the realization of a sustainable society.
Wacoal recognizes that all of our business activities must be groundedin the premise of unrelenting respect for human rights. True to thisstance, we pledge to fully grasp and support the following international principles and standards as the minimum tenets and benchmarks to be maintained with regard to human rights.

Approach Going Forward 
The Group has a process in place to identify negative impacts andrisks to human rights in product procurement and to formulate andimplement appropriate measures in accordance with the Wacoal
Group CSR Procurement Guidelines and is expanding the scope ofsuch activities (please refer to page 33 for details). However, we have
yet to develop a process for human rights due diligence for the supply
chain, with the exception of the procurement process, nor have weidentified the human rights issues reflecting the specific circumstances of our business conditions. The Subcommittee for Human
Rights, D&I, which operates under the Sustainability Committee,
intends to place priority on the establishment of an internal system
for implementing human rights due diligence and identifying thehuman rights issues that are specific to our business.

- Compliance with Applicable Laws and Regulations
Wacoal shall comply with all laws and regulations in force in each of
the nations or regions where it conducts our business activities. In theevent of an occurrence of conflict with internationally recognizedprinciples on human rights or the laws or regulations in force in
specific nations, Wacoal shall pursue methods aimed at ensuring
maximum respect for international human rights principles.
- Human Rights Due Diligence
Wacoal shall formulate a human rights due diligence system, thereby
striving to stipulate the negative impact caused by the Company onsociety and prevent and reduce such impact.

- United Nations Guiding Principles on Business and Human Rights- OECD Guidelines for Multinational Enterprises- The Ten Principles of the UN Global Compact- International Labor Organization Core Labor Standards- Dialogue and Deliberation
Within the process of executing the policy, Wacoal shall utilize theknowledge of outside experts as deemed necessary. Dialogue anddeliberation with related stakeholders shall also be earnestly
conducted.

(2) Scope of Application
The Policy shall apply to all Wacoal executives and employees. Wacoal
likewise looks forward to the understanding and support of the policyon the part of all business partners concerned with our products andservices.

- Education (Training)
Wacoal shall implement broad-based human rights enlightenment
programs targeting all executives and employees, working to ensurethat the policy encompasses the full range of the Company’s businessactivities and is effectively executed.

(3) Fulfillment of Responsibilities in Respect of Human Rights
Wacoal understands the risks that the Company’s business activities
may exert a direct or indirect impact on human rights, and naturally
strives to ensure that such activities do not infringe upon the rights ofothers. Upon learning that any of its business activities have in fact
exerted a negative impact on human rights, Wacoal shall mountappropriate responses aimed at rectifying the situation, thereby fulfilling our responsibilities in maintaining respect for such rights.

- Improvements and Relief
In order to efficiently grasp any negative impact on human rights
accompanying its business activities, Wacoal shall maintain a systemeffective in responding to reports of such situations. In cases when anegative impact has clearly been caused with regard to human rights
or such impact has been furthered, measures shall be adopted throughappropriate procedures to provide relief for the conditions.
- Reports and Information Disclosure
Wacoal shall disclose the progress and the results of measures
adopted in the interest of maintaining respect for human rights on its
website or in other formats.

32

I N T E G R AT E D R E P O R T 2 0 2 2

CREATING EXPECTATIONS

Fulfilling Social Responsibilities along Our Supply Chain
The Wacoal Group engages in responsible procurement with its business partners around the world with the aim of fulfilling its
social responsibilities throughout the entire supply chain. Realizing the importance of meeting the expectations of society, establishing mutual trust, and working in unison, we believe that promoting CSR procurement together with our contract manufacturers andraw material suppliers will maximize the interests of all of our partners along the supply chain and contribute to the sustainablegrowth of all parties. As such, we will continue to engage proactively in this area going forward.
CSR Procurement Based on Mutual Trust and Cooperation 
Wacoal’s supply chains for textiles and apparel begin with productplanning and design in the countries and regions where the products will be sold. Almost all of our products are shipped to theirrespective markets after processing through international networks
in which the production or procurement of raw materials and thesewing and manufacturing of finished products are carried out in
China or emerging countries in the ASEAN region.
Established in October 2017, the Wacoal Group CSR Procurement
Guidelines declare that “in order to fulfill our social responsibilities,
we must build close partnerships with all suppliers involved in our
product manufacturing activities, and together with them we mustcomply with and respect society’s requirements with regard to not
only quality, pricing, and delivery but also human rights, labor practices, the environment, and ethics.” Since February 2018, we havebeen conducting a management cycle that continuously amends andimproves the guidelines in light of careful monitoring of compliancewith the guidelines at our sewing factories and contract manufacturers. Further, Wacoal has been disclosing the basic information ofcontract manufacturers that endorse its CSR-focused procurement
activities on its corporate website since May 2018.

Basic Information Disclosed on Contract Manufacturers(as of June 2022)
Country/region

No. of factories
operated by Wacoal orcontract manufacturers

Percentage of
total factories worldwide

Japan

105

40.4%

China

118

45.4%

Taiwan3

1.2%

Indonesia

3

1.2%

Vietnam13

5.0%

Thailand7

2.7%

The Philippines

3

1.2%

Cambodia3

1.2%

Sri Lanka

1

0.4%

Dominican Republic

1

0.4%

Tunisia

2

0.8%

Other

1

0.4%

Total

260

100.0%

Fiscal 2022 Initiatives and Fiscal 2023 Plan 
Fiscal 2022 Initiatives

Fiscal 2023 Plans• Extended coverage of CSR-focused procurement activities
Added the contract manufacturers of the apparel of consolidated overseas subsidiaries (excluding Wacoal Hong Kong Co., Ltd., Philippine
Wacoal Corp., Vietnam Wacoal Corp., Wacoal Singapore Private Limited,
and Wacoal India Private Limited) and Nanasai Co., Ltd. and of products
other than the apparel of Wacoal Corp. and Peach John Co., Ltd. as
survey targets• Implement on-site and remote audits and operate assisted audits
Resume on-site audits in Japan and partially resume on-site audits andproceed with the operation of assisted audits (certification results ofexternal auditing firms) overseas• Verified the status of compliance with matters specified in the Wacoal
Group CSR Procurement Guidelines via self-assessments
Conducted self-assessments for the second time with 58 contract
manufacturers that began engaging in CSR-focused procurement
activities in fiscal 2020

• Accurately monitor the status of compliance with matters specified in
the Wacoal Group CSR Procurement Guidelines through selfassessments and provide feedback on analyses and assessments• Verified the feasibility of remote audit methods (as a replacement toon-site audits due to COVID-19)
Verified the effectiveness of remote audits, particularly on mattersrelated to labor practices that stood out as issues in the results ofprevious audits, as an alternative solution to on-site audits, which were
held prior to COVID-19• Incorporated external certification into the audits of contract
manufacturers of consolidated overseas subsidiaries
Approved the use of certification results for factories that have beenassessed and certified by external organizations as capable of ensuring
the content of audits as requested by the Company, in order to extend
the coverage of CSR-focused procurement activities by ensuring therationality and effectiveness of audits• Establish an auditing method for raw material suppliers upon
conducting pilot audits at the raw material factories of overseas Groupsubsidiaries• Minimize negative impact on human rights and proceed with measures
toward improvement
Expand training opportunities to raise awareness of CSR-focusedprocurement activities on the basis of respecting human rights at our
sewing factories and increase the number of criteria pertaining tonegative impacts on human rights in self-assessments and on-site
audits for contract manufacturers and raw material suppliers in Japanand overseas in order to prevent, mitigate, reduce, and eliminate suchimpacts

Status of Operations at Myanmar Wacoal Company Limited

Upon the resumption of military rule in Myanmar in February 2021, our factory at Myanmar Wacoal Company Limited was shut down until the endof August due to intensifying clashes between the nation’s military and protesters as well as the escalating impact of COVID-19. During this period,
the situation in Myanmar continued to undergo rapid changes, and therefore, we took the necessary actions to eliminate and reduce risks by identifying them in a timely manner. However, we have not conducted human rights due diligence to comprehensively identify the risks of employees
under military rule. The greatest risks to human rights identified through this process are those concerning the safety of the lives and physicalconditions of our employees. In order to ensure the health and safety of Myanmar Wacoal’s employees, we shared information as necessary on thelocal situation, including the security situation, at the Group Management Meeting and Board of Directors’ meetings and established a system fortaking appropriate measures in a timely manner. As an example of such measures to ensure safety, employees were prohibited from going to workand given paid leave instead or were allowed to work from home when commuting to their workplace became difficult due to military inspections
or when their safety was likely to be at risk on their way to work due to the security situation.

I N T E G R AT E D R E P O R T 2 0 2 233

Sustainability

Strengthening Human Assets
Consistent with its founding principle of mutual trust, the Wacoal Group manages employees’ health and safety, trains personnel,
and is receptive to diversity in human resources and values in each workplace, thereby deepening mutual trust with employees anddeveloping workplace systems conducive to the creation of environments where the talents of individual employees can be fully
realized. We have built value chains that comprise proprietary networks, which span all stages from fundamental research, productplanning, and development through to materials procurement, production, and sales. In these value chains, human resources are theGroup’s most important management resource. For this reason, we believe that creating an appealing corporate culture that is
employee friendly and offers job satisfaction will lead to sustained growth.

Human Resource Cultivation and Organizational
Development with a View to Enhancing Corporate Value
We believe that our development as a company is dependent
upon efforts to enhance the qualifications of each employee.
Based on this belief and with the aim of nurturing a corporate
culture conducive to the growth of each individual and fostering a new type of talent who are autonomous in their actions
and can realize our management philosophy, we provide andconduct training programs that support the development of
employees’ careers and professional skills.
Under the Wacoal Terakoya personnel development system,
which began operating in April 2019, we are providing employees with more opportunities to put themselves forward fortraining by increasing and enhancing training programs outside the rank-based training curriculum. For example, to support employees’ autonomous career development andcontinuous learning, we conduct joint training with other companies that helps trainees master business skills. Also, we offer
training designed to develop globally competent personnel.
In addition, we conduct human resources development basedon the skills required in particular fields. For example, we provide
training on maintaining and enhancing the quality of Wacoal
products as well as programs aimed at promoting customer satisfaction by heightening employees’ consultative capabilities. Other
key initiatives include passing on our highly competitive manufacturing techniques and enhancing quality and productivity
on a global basis by providing support and direction throughtechnical experts dispatched from Japan to overseas factories.

Improvement of Employee Engagement and Well-Being
In VISION 2030, we have set forth our aim to “evolve and growinto a “Global Wacoal” by capitalizing on quality and our heightened sensibility to provide each customer with physical andemotional beauty and enrichment.” To achieve this aim, it isessential that we increase the job satisfaction of our employees,
who are important stakeholders, and improve the productivity ofthe organization as a whole.
Wacoal considers increased job satisfaction and employee
happiness to be the driving forces behind high productivity andis working to improve employee engagement and well-being.
The Company also conducted an employee engagement survey
in November 2021, which received responses from 4,462
employees (approximately 90% of all employees), including
those in sales positions. Positive ratings were received for theCompany, products and services offered, and co-workers, whileinterdepartmental communication and the legitimacy of evaluations were rated negatively. Among the material issues we
aim to resolve by 2030, we have identified “employees” as anarea of critical focus, and endeavor to achieve growth in each of
our employees and establish a highly rewarding organization.
We aim to further improve employee engagement and wellbeing by analyzing the results of this survey in more detail,setting KPIs for 2030, developing various measures for thepromotion and implementation of the WACOAL Way, andpromoting workstyle reform and health management.

Message from the General Manager of the Personnel Department

Aiming to foster a corporate culture that provides job satisfaction and transforming into
a company that enables each and every employee to demonstrate their individuality and strengths

Shinsuke Fukazawa
General Manager of
Personnel Department
Wacoal Corp.

34

The results of the engagement survey conducted in fiscal 2022 showed that loyalty to the Company and affinity for its brands werehigh, while there was significant dissatisfaction with interorganizational communication and the current evaluation system. The
Personnel Department takes these results seriously and has reaffirmed the importance of fostering a culture in which employees
can experience personal growth and job satisfaction. In the area of human resources development, we will implement measures toenhance employee career autonomy and increase job satisfaction under the new medium-term management plan. Measures
include providing support for personnel in acquiring the business skills necessary to develop new fields, and expanding the Job
Challenge and Outside Career Challenge systems, which allow employees to personally request transfers, to increase opportunities
for employees to develop their careers on their own initiative. Through these measures, we strive to nurture human resources who
can spur innovation. From the perspective of organizational development, the Company will continue to increase the diversity of
its human resources while building a highly productive organization with a small but exceptionally skilled workforce. In order tolay the foundation for these efforts, we are planning to begin work as soon as possible on creating new systems and mechanisms
for fair evaluation and treatment of employees and for the appointment of leaders who can continue to boost the organization’s
appeal. To foster an even more supportive corporate culture that encourages employees to step forward on their own initiative, wewill transform our corporate culture by increasing the transparency and diversity of our human resources management throughmeasures such as clarifying evaluation criteria and enabling employees to independently develop their careers.
We will also promote initiatives focused on diversity and inclusion. The percentage of women in managerial positions at
Wacoal Corp. is 27.3% (as of the fiscal year ended March 31, 2022). We consider it an important management issue to create anorganization in which all employees can play an active role regardless of gender or other personal characteristics, in order to reflect
diverse values in our decision-making. To establish an environment in which all employees can play a more active role whileleveraging their personal strengths and individual characteristics, we are implementing flexible workstyles that suit employees’life plans and values and will continue to support women in building their careers.

I N T E G R AT E D R E P O R T 2 0 2 2

CREATING EXPECTATIONS

Project to Promote Awareness of the WACOAL Way
and the Project to Improve Women’s QOL

Health and Productivity Management

One of our employee-related material issues is building an organization that can demonstrate great results through co-creationand collaboration, and one of our concrete initiatives to achieve
this is fostering an organizational culture in which people fromvarious positions can cooperate and achieve their missions. In
April 2022, the Project to Promote Awareness of the WACOAL
Way was launched to examine what is required of the Wacoal
Group to increase the number of employees who can act withclarity on what the Company should be and its Mission, and aconcrete action plan is being formulated. Promoting awarenessof the WACOAL Way encourages employees to become more
conscious of their role in the Company and instills a sense of
responsibility, which in turn leads to improved morale within
the Company.
Furthermore, we have identified the “Promotion of co-­creation
innovation to solve social issues” as a material issue related tosociety, and one of our concrete initiatives to achieve this is ourcontribution to women’s quality of life through ongoing dialogues with stakeholders. The Project to Improve Women’s QOL(quality of life), which was launched in April 2022, is exploring
initiatives to improve women’s quality of life from a broad
range of perspectives, ranging from the revision of employee
systems to customer support.

One of the material issues set forth in VISION 2030 is the continuous improvement of employees’ health and health awareness. Our goal under the newly formulated Wacoal GENKI
Project 2025 for promoting health management is to improve
the physical and mental well-being of employees, leading toincreased productivity and improved employee engagement.
We will continue to promote health maintenance through theongoing implementation of various countermeasures toaddress lifestyle diseases, cancer, and mental health whilefurther developing a working environment that enables
employees to make self-initiated efforts to improve their health,thereby encouraging changes in behavior and attitudes toward
the subject of health improvement itself. We are also stepping
up our efforts to address health issues that are specific towomen. Furthermore, Wacoal Holdings Corp. has been selected
as an Excellent Enterprise of Health & Productivity
Management (White 500) for six years in a row since 2017.

Wacoal GENKI Project 2025
Concrete initiatives

Physical health

Physical andmental health

Mental health

Targets

Improvement in the physicalhealth of employees

Improvement in the mental
health of employees

KPIs

FY2021 (results)

1. Percentage of employees at risk of lifestylediseases

Less than
25%

29.0%

2. Percentage of follow-up examinations takenby employees at high risk

100%

87.6%

Number of employees absent due to mental
health issues × the number of days absent

Fewer than

10,00014,798Percentage of employees recording high levels ofstress in stress check

Less than 5%

7.9%

Health literacy

Independent employee healthmanagement through improved
health literacy

Percentage of employees who are able to utilize
information to determine plans and actions toimprove their healthMore than
70%

59.5%

Changes inbehavior andattitudes toward
healthChanges in behavior andattitudes toward healthimprovement

Employees practicing positive behaviors in thefive categories of diet, exercise, sleep, alcohol
consumption, and smoking

To be set bycategory―

Percentage of female employees receiving
examinations for breast cancer anduterine cancer

100%

Breast cancer
90.8%
Uterine cancer
76.7%

Increase in the number of employees with anunderstanding of symptoms specific to women*―

Percentage of employees whose work
performance is negatively impacted due tosymptoms specific to womenLess than
10%

13.5%
(Results of the
fiscal 2021
survey)Women’s health

Improvements in health issues
specific to women

Productivity

Increase in number of employees
working with a high level ofproductivity

Improvement of productivity indices(absenteeism and presenteeism)

Reduce by
10%―

Engagement

Increase in number of­ nthusiastic employees whoeproactively carry out their work

Increase in positive responses to employee
engagement survey

Increase by
10%―* To be set according to the results of the fiscal 2022 survey

I N T E G R AT E D R E P O R T 2 0 2 235

Value Creation Process
The Group will maximize and optimize the various assets that it has developed—including physical, financial, trust-related,* andorganizational assets—and advance medium- to long-term growth strategies to resolve material issues and enhance enterprisevalue even further. Through rigorous, customer-focused value chain reform as well as the evolution of our value creation process,we will continue bringing products and services that enrich society to the market.
* Wacoal defines “trust-related assets” as assets that are comparable to human assets or customer assets because they increase or
decrease depending on relationships of trust with the Company. Trust-related assets differ from organizational assets, which
are entrenched in our organization and are not dependent upon such relationships as employment or business transactions.

Material Issues

Management Strategy

Evolve our unique capabilities as an organization

Customers

Maximize the value
provided to customers
R&D
Employees

Achieve the growth ofeach of our employees
and establish a highly
rewarding organization

Sales / Marketing

Customer-driven value

Product /Planning

chain reform
Enhancement of profitability
and productivity for all

Environment

processes in the value chain

Preserve theenvironment globallyfor future generations

Production

Procurement

Society

Realize a society inwhich everyone plays
an active role in theirown way
VISION 2030, our medium- to long-term management strategy framework
Governance

Enhance governancetoward the realizationof sustainable growthFounding
Principle

Relationships
founded inmutual trust36

I N T E G R AT E D R E P O R T 2 0 2 2

Promotesustainability
management

Promote digitaltransformation

Expand ourbusiness areas

Expand inemerging areas

Bolster
production
functionsFoundations Underpinning Our Value Creation

Financial strategy

Human resources
strategy

Development ofan ­organizational
cultureReinforcement ofcorporate
governance(Valu

CREATING EXPECTATIONSHow Wacoal Works to Create a
Sustainable Society

Committing to the enrichment of the
lives of people around the world

Outputue provided throughour businesses)

MISSION
Products andHelping people realize

services that enrich ourtheir individuality, andcustomers’ daily lives

their inner beauty, rather
than uniform externalbeautyHelp people
look and feel
their best

Striving to solve various
social issues such as theenvironment and humanrightsSafe, reliable,
high-quality products
and servicesdidevpro lueeualva ew vfon
on n ofit
iza atiomix
Products andcre
Ma andservices underpinning
the well-being of ourcustomers

Products andservices that pay
due respect to the­environment andhuman rights

Assets and Competitive Advantages Developed
Intangible Assets

Tangible Assets
Physical Assets
Group factories in Japan andoverseasAppealing sales areas and a richproduct lineup

Financial Assets
 bundant capitalAStrong financial foundations

Trust-Related Assets
Extensive and diverse groups ofspecialists
Trusted brands and­relationships with customers
Social contribution throughbusinesses
Favorable business partnerships

Organizational Assets
Abundant physique ­measurement
data and accumulated knowledgeof the Human Science Research &Development Center
Original design and­manufacturing technologies andquality control system
The beauty advisor training
systemI N T E G R AT E D R E P O R T 2 0 2 2

37

VISION

2030

MEETINGEXPECTATIONS38

I N T E G R AT E D R E P O R T 2 0 2 2

MEETING EXPECTATIONS and FULFILLING COMMITMENTSW A C O A L
I N T E G R A T E D
R E P O R T
2 0 2 2

FULFILLINGCOMMITMENTSI N T E G R AT E D R E P O R T 2 0 2 2

39

A Message from the President

We will realize the goals of our medium- to long-term
management strategy framework VISION 2030 byembarking upon ambitious new initiatives.

Hironobu Yasuhara
Representative Director,
President and CEO
Wacoal Holdings Corp.

Review of the Previous Medium-Term
Management Plan
By transforming society and day-today life, the global COVID-19 pandemic
significantly affected the wholesale
and retail businesses of the Wacoal
Group. In response, we positioned theperiod of the previous medium-term
management plan, which ended
March 31, 2022, as a phase for40

I N T E G R AT E D R E P O R T 2 0 2 2

accomplishing structural reform torestore robust profitability. As well as
stepping up the pace of business structural reform, we concentrated on continuing to advance our customer
experience strategy. Thanks to these
efforts, we made significant progressin the advancement of such digitaltechnology strategies as strengthening
the e-commerce business and utilizing
customer data. Nonetheless, the benefits of the investments accompanying

these strategies were insufficient tosupport our business performance.
At the same time, changes in the
structure of consumption predating the
pandemic forced the Group to reform abusiness model that had once been astrength. Therefore, during the periodof the previous plan, we launched newcustomer services, including the introduction to Japan’s market of a newmeasurement service that uses 3Dbody scanners.

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Originally, we intended to use theperiod of the previous plan to verify
whether our digital technology-based
initiatives were producing the benefits
envisioned and to refine them as
required before embarking upon a new
three-year plan. Due to the constraints
on store activities that resulted fromthe pandemic, however, we were unable
to fully verify the effects of these initiatives. Overseas, meanwhile, new issues
emerged in our e-commerce businesses in China and the United States
during the previous two fiscal years. In
the period of the new medium-term
management plan, we will carefully
address such issues that have been
carried over from the ­previous plan.
The reform of subsidiaries and other
underperforming businesses is still inprogress. Although Peach John Co.,
Ltd., has successfully transformed intoa highly profitable company throughstructural reform and the growth of
e-commerce, the business environments and performances of many
subsidiaries remain unfavorable due tothe prolonged pandemic. Going forward, we will take a hard look atwhether such subsidiaries have thepotential to turn earnings around andto perform meaningful roles when thebusiness environment recovers.
Over the past several years, themarket has changed dramatically.
Even when the pandemic is contained,
a return to former patterns of consumer behavior is unlikely. Also, we
cannot make clear predictions about
how society will change. What is certain, however, is that the market willcontinue changing. The pandemicheightened Group employees’ sharedawareness of this ongoing change,
which represents an extremely significant shift in mindset. Going forward,
we will view market changes as opportunities for self-reform and work totransform into a highly adaptablecorporate group.
VISION 2030 and Its Road Map
We established VISION 2030, our
medium- to long-term management
strategy framework, by clarifying ourtarget profile and backcasting fromlong-term goals. Our 2030 goal is to
evolve and grow into a “Global Wacoal”
by capitalizing on quality and ourheightened sensibility to provide eachcustomer with physical and emotional
beauty and enrichment.
VISION 2030 comprises three main
components—a management strategy,
material issues, and the Guidelines for
the Actions of Officers and Employees—
as well as a road map indicating how
the Group will realize these components. To heighten the effectiveness of
VISION 2030, the road map sets out key
performance indicators (KPIs) to bereached by fiscal 2031 and establishesinterim targets in three-year increments as milestones on the way toachieving these KPIs.
Simply building on and expanding
current businesses will not enable us
to reach our fiscal 2031 managementtargets, namely, sales revenue of¥270.0 billion and a business profit
ratio and ROE of 10.0%. Also, our homemarket in Japan is experiencing amarked decline in population, and thistrend is expected to accelerate after
2030. Therefore, in Japan over the next
few years we need to expand our customer base. In other words, we must
increase our market share. At the sametime, the Wacoal Group must increase
the range of products and services it
can offer customers, thereby raising
the average spending per customer. In
addition, we will heighten our growthpotential and profitability by strengthening the e-commerce business and bycreating new points of contact throughambitious initiatives aimed at capturing growth opportunities in the
metaverse market.
Meanwhile, overseas businesses
will play an even more important role
than domestic businesses in realizing
VISION 2030. As markets in countries
where we already have a presence,such as the United States, the United
Kingdom, China, and other Asian countries, are likely to become larger, we
will continue expanding businesses inthese markets while ensuring profitability. In addition, we will open up
new markets in Europe and India.
In accordance with VISION 2030,“beauty,” “comfort,” and “health” will be
the watchwords as we tackle new
business fields with our sights set on
the future. An emphasis on these concepts is nothing new for us. We have
rededicated ourselves to them because
we will create businesses and realize

our new Mission only by focusing
management resources on fields inwhich we are uniquely qualified toprovide products and services. Our
purpose in society is to contribute tobeauty, comfort, and health by developing and increasing a lineup of new
products and services supported by thequality and heightened sensibility thatdifferentiate us.
Role and Priority Measures of the
New Medium-Term Management Plan
The first milestone on the way to therealization of VISION 2030 is the new
medium-term management plan,
covering fiscal 2023 through fiscal
2025. The role of the new plan is to lay
solid foundations for the realization of
VISION 2030. In accordance with theplan’s core strategies, domestic businesses will shift to a resilient corporate
structure, overseas businesses will
accelerate global growth, sustainability
initiatives will promote efforts that
address material issues, and the pursuit of financial targets will generate
ROE that exceeds capital cost.
With respect to our domestic business, we must quickly resolve thehigh-cost structure that has again
become apparent amid the pandemic
and strengthen our adaptability. We
will improve profitability by continuing
the cost structure reform measures
begun under the previous mediumterm management plan, such as the
management of personnel plans, andby reforming workstyles and manufacturing structures. Another issue thathas been pointed out by investors andother external stakeholders is the
weakness of the Wacoal Group’s marketing capabilities. In the past, theGroup heightened its brand profile
through television commercials as wellas advertisements in magazines andother mass media. However, as ourcurrent strategy for domestic businesses is to build personal relationships with customers, we need to
improve our digital advertising capabilities so that we can precisely target
particular types of customers while
reliably verifying the effectiveness ofsuch targeting. To strengthen our marketing capabilities, we completed theintegration of customer data during theprevious plan, and we are in the

I N T E G R AT E D R E P O R T 2 0 2 2

41

A Message from the President

process of establishing capabilities thatwill enable us to analyze and utilize
this data with the aim of increasing
customer lifetime value. By effectively
utilizing customer data while attracting greater numbers of new customers
and fostering customer loyalty, we willgrow sales.
Overseas businesses will roll out
unique services that integrate offlineand online services to differentiate the
Wacoal Group from competitors andheighten brand recognition. In conjunction with these initiatives, we will
increase profitability through improvement in the profitability of subsidiaries
in Asia and Intimates Online, Inc., in
the United States.
With regard to production andsupply, we expect that the pandemic
and heightened geopolitical risks will
drive up raw material and transportation costs. In addition, constraints
accompanying the pandemic could
lead to unavoidable destabilization of
our production and supply.
Accordingly, we will reorganize our
supply system globally to heighten
productivity, and we will take measures to stabilize plant operations.
Over the coming three fiscal years,
we will steadily advance the core strategies I outlined earlier to achieve concrete results. Aiming for sales revenueof ¥220.0 billion, business income of¥16.0 billion, and ROE of 6.0% as mustachieve targets, the Wacoal Group will
forge ahead in a cohesive effort toachieve a recovery in businessperformance.
Enhancement of Management
Effectiveness
The most important factor in ensuringthat the new plan produces results isreforming the awareness of eachWacoal Group employee. I believe that
all officers and employees—fromfrontline sales personnel through tomiddle management and the senior
management team—must have astrong determination to break awayfrom our current situation as well as a

42

I N T E G R AT E D R E P O R T 2 0 2 2

sense of ownership. However, simply
declaring “Let’s change our mindset!”does not change people. Changing
mindsets requires changes in behavior.
To coincide with the launch of the
new plan, we revised the management
structure of Wacoal Holdings Corp. toclarify the responsibilities of business
managers in Japan and overseas. Byclarifying management responsibilities, we will accelerate reforms andincrease the effectiveness of management. We are also continuously
improving the system for the compensation of officers. Following on fromthe previous fiscal year’s introductionof a transfer-restricted stock compensation plan, we have already revised
the ratio of monetary compensation to
stock compensation for officers in thecurrent fiscal year. In addition, thenewly formulated Guidelines for the
Actions of Officers and Employees
form one of the three main components of VISION 2030. Prepared by themembers of the teams that formulated
the Wacoal Group’s new Mission andmaterial issues, these guidelines reflect
an awareness of what is lacking in theGroup at present as well as a desire tochange the behavior of each officer
and employee.
To increase the effectiveness of theaforementioned guidelines, setting
different targets in day-to-day operations and rebuilding the evaluation
system are essential. For example,
simply changing the focus of performance targets from sales to profit
should significantly change the behavior of employees. Such a reform will
not only improve the profitability of theGroup but also elevate the fundamental
level of the workforce’s capabilities.
Reformed goals and evaluations thatchange behavior and thereby improvebusiness results will both heighten
employee motivation and help revitalize the organization. We have alreadybegun revising the goals for our daily
operations, and we will comprehensively advance these initiatives toincrease the effectiveness ofmanagement.

Sustainability
Initiatives
In April 2022, the Group became asignatory to the United Nations Global
Compact, an international framework
for the realization of a sustainable
society. By adhering to the 10 principles
set forth by the compact in the fourareas of human rights, labor, the environment, and anti-corruption andcontinuing to conduct business activities that reflect the expectations ofinternational society, we will help
realize a sustainable society andenhance our enterprise value. The
expectations of international society
and our customers are increasing,particularly with regard to humanrights and the environment. Given our
corporate social responsibility, we needto strengthen measures aimed at theGroupwide resolution of issues.
Regarding human rights, in April
2022 we revised the Wacoal Group
Human Rights Policy to conform with
the United Nations Guiding Principles
on Business and Human Rights. We
have already begun using a management cycle to accurately assess thecompliance of and continuously correct and improve the Wacoal GroupCSR Procurement Guidelines. Goingforward, based on the concept ofhuman rights due diligence that iscompliant with the aforementioned
principles, we will strengthen measures focused on reducing and preventing adverse impacts on humanrights and promoting respect forhuman rights.
As for the environment, in
September 2021 we announced ourendorsement of the recommendations of the Task Force on Climaterelated Financial Disclosures, and webegan disclosure based on the recommendations in June 2022. Also, theSustainability Committee is currently
discussing specific processes for
reducing greenhouse gas emissions.
As interest in sustainability grows,
consumers are increasingly seeking

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

The most important factor in ensuring thatthe new plan produces results is reforming theawareness of each Wacoal Group employee.

high-quality products that can be usedover the long term and products thatpay due respect to the environment.
Through the provision of high-quality
products—one of our fortes—we will
advance environment-friendly initiatives in tandem with consumers.
The Group Philosophy’s
New Structure
Last but not least, in conjunction withthe announcement of VISION 2030, we
have redefined the Group Philosophy,
creating the WACOAL Way. As a corporate group advancing sustainabilityfocused management that addresses
social issues while realizing sustainable growth, we needed to establish a
new mission in relation to society.
On the other hand, Our Promise, Our
Culture, and Our Value have been
passed down since the Wacoal Groupwas founded more than 70 years ago
and therefore have always been thetouchstones of business management.
These elements of the WACOAL Way
have been treasured for such a longtime because they have a universalitythat is not found anywhere else.
Accordingly, the new framework positions the existing elements, now Our
Promise, Our Culture, and Our Values, as
the components of our Founding
Principles while separately establishing
our new Mission. Together, the new andold elements form the WACOAL Way.
The reputation of the Wacoal Groupwill depend on its implementation andrealization of the new Mission. In otherwords, whether the new Mission we
have set out actually gives customers asense of real change will be critical.
The provision of products and services
that help solve the issues faced by eachcustomer and that, as such, earn customer satisfaction is of the utmost
importance. Ultimately, the degree towhich we achieve this task will converge with our level of business performance. Conducting businesses that do
not produce favorable results is merely
a form of complacency. I believe that
this customer-focused approach tobusiness is the essence of sustainable
ESG-driven management.
By ensuring that everyone, fromfrontline employees through to senior

management, fulfills their roles andresponsibilities in respective positions,
the Wacoal Group will continueenhancing its enterprise value andachieving sustainable growth as acorporate group that has a clear purpose in society. As we take on freshchallenges, I would like to ask all of our
stakeholders for their continued
support.
September 2022

Hironobu Yasuhara
Representative Director,
President and CEO
Wacoal Holdings Corp.

I N T E G R AT E D R E P O R T 2 0 2 2

43

Review of the Previous Medium-Term Management Plan
During the period of the previous medium-term management plan, which covered fiscal 2020 through fiscal 2022, the Wacoal
Group recorded disappointing business results due to the severe impact of the global COVID-19 pandemic. Moreover, in addition to
triggering such major changes in the behavior and lifestyles of consumers as the spread of telecommuting and the increased useof various online services, the pandemic has changed the values of consumers and their attitudes toward health. As a result of theGroup’s inability to fully adapt to these unexpected changes, many tasks have been carried over to the new medium-term
management plan.

Review of Previous Medium-Term Management Plan
Consolidated Net Sales / Operating Profit (Loss) / Operating Profit Ratio 
Net sales

Operating profit (loss)¥210.0billion¥186.8 billion¥172.9 billion

6.7%¥152.2 billion

3.6%

¥6.6
billion¥(1.1)
billion

2.9%¥5.0
billion¥14.0
billion(0.7)%FY2020

FY2020

FY2021

FY2022

FY2022
initial plan

Net income attributable to
Wacoal Holdings Corp.
(¥ billion)

3.5

7.0

4.6​

12.0​

Return on equity

1.6%

3.3%

2.1%​

6.0%​

Cash generated(¥ billion)(Net income* + Depreciation
cost + Reduction in strategic
shareholdings)

27.8

10.8

14.4​

3-year
70.0 or
more

Reduction in strategic
shareholdings (¥ billion)(Book value as of the end of
FY2019)

13.6

2.6

3.5​

20.0​

Dividends per share (yen)

60

40

50​

—

Operating profit ratio

FY2021

FY2022

FY2022
initial plan

* Estimated in real terms without taking into account impairment losses ofintangible assets, securities, or valuation gains and losses

Business Results by Segment Net sales

Operating profit (loss)

Wacoal Business (Domestic)

Wacoal Business (Overseas)(¥ billion)
120

119.7
106.1

100

86.1

(¥ billion)
80
60

88.1

80

59.7

61.6

49.8
41.4

40

60
20

40

0

20

6.1

0
FY20200.6

2.3

FY2021

FY2022

-2.6

7.9
–20
FY2020

FY2022
initial plan

Peach John Business

Other Businesses(¥ billion)

(¥ billion)

15
12

11.2

12.5

11.6

20
15

6

10

3

1.6

1.7

FY2022

FY2022
initial plan

19.6

17.1
12.5

–0.4

0

0.5
–0.6

–0.7

–1.3

FY2020

FY2021

FY2022–5
FY2020

FY2021I N T E G R AT E D R E P O R T 2 0 2 2FY2022

12.5

5

0.4

–3

44

FY2021

25

12.2

9

0

5.3

2.4

1.5

FY2022
initial plan

FY2022
initial plan

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Achievements under Previous Medium-Term Management Plan Primary Policy 2

Primary Policy 3Show Strong Growth
Domestically and Internationally

Verify Unprofitable Businesses’
Future Potential and Carry Out
Structural Reform

Strengthen Efforts toCreate Social Value

Result and Issues

Evaluation

Primary Policy 1

Wacoal Business (Overseas)

Peach John Business

The Environment• Sales in the United States and Europe
reached record highs. The e-commercebusiness, where we have focused our efforts,
achieved robust growth.

• The company became highly profitable
thanks to structural reform.

• We disclosed medium- to long-term targets
for reducing greenhouse gases

Other Businesses

Society• Competition with emerging brands­intensified in China.

• Workforce rightsizing, plant closures, andother structural reforms were begun.
However, the business environment
deteriorated due to the impact of thepandemic.

• For CSR procurement, we disclosed
everything up to the list of factories to which
our major overseas affiliates outsource.

Wacoal Business (Domestic)• Issues related to profit structure and sales
channel structure were brought to light by asluggish performance.

• Tasks were carried over to the new mediumterm management plan.

Business Issues Domestic BusinessEliminate the rigid high-cost structure andtransform into a resilient company•E liminate rigid high-cost structures that are easily
affected by sales revenue trends•A cquire new customers via stronger marketing•P rovide new value to customers and create new
businesses

Overseas Business
Further increase profitability and continuous
growth, centered on e-commerce• Respond to a lag in the LIVELY brand’s growth caused bysaturation in the U.S. e-commerce market and targeted
advertising regulations• Achieve growth in new countries and regions with large
potential markets, such as India and Germany•S tabilize management within our domestic subsidiaries
and verify businesses’ ability to continue and decide
whether to let them do so or change them

• Realize the regrowth of e-commerce by heightening brandawareness in China’s market and strengthen brand strategy to acquire an expanding population of middle-classcustomers

Production and Supply System Challenges

Sustainability

Renovate our global supply system toimprove productivity

Promote co-creation innovation that solves social
issues as opportunities for growth•S often the blows from soaring raw material and shipping
costs by making production and shipping operations
more efficient• Convert initiatives for increasingly complex and diverse
social issues into opportunities for future growth bypromoting innovation based on co-creation•W ork to stabilize factory operations as COVID-19 spreads• Strengthen responses to increasingly severe humanrights and environmental issues, such as climate change•R eorganize supply capabilities on a global basis to further
enhance productivity• Strengthen our ability to respond to change by increasing
the number of employees that can clearly define and act
on the Company's target profile and Mission

I N T E G R AT E D R E P O R T 2 0 2 2

45

VISION

2030

Create New Value from an Innovative
Perspective and Achieve Sustainable GrowthWith the aim of putting the WACOAL Way into practice, we have formulated VISION 2030 by backcasting from long-term goals
while keeping in mind the issues of our business, customer values, and changes in society and the environment. Based on thisvision, our 2030 goal is to evolve and grow into a “Global Wacoal Group” by capitalizing on quality and our heightened sensibility
to provide each customer with physical and emotional beauty and enrichment. We will achieve sustained growth and enhance
corporate value through the following initiatives.

Main Goals of Initiatives​​

Creating Expectations

Meeting Expectation

Fulfilling Commitments-Achieve global growth-Provide greater value and expand ourbusiness areas-Create a culture where diverse humanresources can play active roles-Achieve an operating margin and ROEof approximately 10%-Address material issues(Strengthen responses to­environmental and social issues)-Continuously improve the executive
compensation system-Optimize the Board of Directors'
member structure-Optimize the capital structure

VISION 2030 Management Strategies​
VISION 2030 consists of three elements: a management strategy, material issues, and the Guidelines for the Actions of Officers andEmployees. Our management strategy includes four priority strategies: improve domestic profitability and expand our businessareas, expand overseas businesses and transform them into highly profitable structures, strengthen the Group’s management
capabilities, and shift to more capital-efficient management. Through the implementation of these strategies, we will expand ourbusinesses, increase profitability, and strengthen our management foundations. At the same time, we will advance sustainabilitydriven management that simultaneously addresses social issues and achieves continuous growth.

Improve domestic profitability and expand
our business areas

Expand overseas businesses and transformthem into high-revenue structures

Grow steadily in Japan and create
new businesses in the health area

Continue expanding in the areas we have entered andgrow in the European and Indian markets

Restore our domestic market shares by promoting ourcustomer experience strategy
Expand the areas we do business in within the beauty,
comfort, and health fields

 trengthen digital marketing to acquire new customers
SStrengthen customer relationship management to makeexisting customers loyal
Strengthen brand investment in new markets

Promote Sustainability
Management

Strengthen the Group’s
management capabilities

Shift to more
capital-efficient management

Strengthen the Group’s corporate governance anddevelop and utilize diverse human resources andestablish both domestic and overseas technology,
production, and R&D bases

Continuously generate ROE that exceeds capital cost andoptimize how we distribute value to stakeholders

Redefine our quality standards, make sewing factories
into smart factories, and pursue production andshipping efficiency

46

I N T E G R AT E D R E P O R T 2 0 2 2

Work to achieve ROE of 10% and optimize the capital
structure

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

VISION 2030 Plan Sales Revenue

Business Profit¥270.0 billion¥205.0 billion¥220.0 billion¥7.0 billion
FY2023

FY2025

FY2031(Final year of VISION 2030)
FY2025 plan
(Final year of mediumterm management plan)

FY2031 plan
(Final year of VISION 2030)

205.0

220.0

270.0

Total sales of Wacoal Business (Japan), Peach John, etc.

134.9

(vs. Sales Revenue)

70.1(vs. Sales Revenue)

Overseas Business(¥ billion)

FY2023 plan
(First year of mediumterm management plan)

Sales Revenue
Domestic Business¥27.0
billion¥16.0
billion

65.8%

133.2

34.2%

86.8

60.5%

162.0 60.0%

39.5%

108.0 40.0%(Reference) Sales Revenue including equity-method affiliates

–

–

340.0

Business Profit

7.0

16.0

27.0

Business Profit ratio

3.4%

7.3%

10.0%

Net income attributable to owners of parent

5.5

12.5

21.0

ROE

–

6.0%

10.0%

Shareholders' equity

–

210.0

210.0

VISION 2030 Business Portfolio (Overseas Businesses)
Innerwear sales
Operating profit

Operating margin

Strengthen growth andtransform into highrevenue businesses¥12.0 billion

10% level

Sales Revenue: ¥108
billion ; Operating
margin: 10%¥10.0 billion(Wacoal Japan)
Innerwear sales(Peach John)
Innerwear sales¥5.0 billion

Increase Wacoal
Japan’s non-innerwear
sales
Try to expand businesses in
the health area(new businesses and M&As)

Sales Revenue: ¥20
billion ; Operating
margin: 10%

Transform into highrevenue business• Reform the cost structure• Deal with unprofitablebusinesses

Achieve stable
growth andincreased
revenue(Wacoal Japan)
Non-innerwear sales
Expand businesses in
the health area (newbusinesses and M&As)¥50.0 billion

Sales Revenue¥100.0 billion ¥120.0 billion(Other Businesses)• Deal with unprofitablebusinesses• Reform the cost structure• New M&As

Designate Europe and the UnitedStates as growth drivers
Planned value for overseas
businesses (excl. nonconsolidated
companies)

Achieve highrevenues in our corebusinesses(Structural reform /Management of unprofitablebusinesses)

Secure an operating
margin around the
8–10% level

VISION 2030, the meduim- to long-term management strategy framework
Actual FY2022 results

I N T E G R AT E D R E P O R T 2 0 2 2

47

VISION

2030

Road Map
Business
ProfitFY2028

Sales Revenue
Business
ProfitFY2025
Sales Revenue¥220 billion

VISION 2030
Medium- to long-Term
Management Strategy
Framwork

Domestic
Business

Improve domestic­profitability andexpand ourbusiness areas¥22 billion(8.8%)¥250 billion

ROE of 8%¥16 billion(7.3%)ROE of 6%

Achieve Regrowth and Finish Structural Reform
Return existing business to a growth ­trajectory(Wacoal Corp.)• In-house e-commerce: ¥20 billion• Self-managed store sales: 40%
Try to create new businesses

Continue Expanding in the Areas We Have Entered

Overseas
Business

Expand overseas
businesses andtransform them into
high-revenue structures

Achieve growth in the Asian region•S ales Revenue: ¥5.9 billion(Operating profit: ¥0.3 billion)• Strengthen efforts to expand in emerging areas
Make IO, Inc. profitable again(Goal for the fiscal 2024)

Formulate Processes to Solve Material Issues

Sustainability

48

I N T E G R AT E D R E P O R T 2 0 2 2

Developsustainability solutions
through our businessAchieve ratio of women in management positions of 30% or more
Achieve the health and productivity management targets of GENKI Project 2025
Disclose all material issue KPIs (this and thepreceding points relate to Wacoal Corp. only)Review the Group companies' material issue KPIs

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

FY2031
Sales Revenue¥270 billion

Business
Profit¥27 billion(10%)
ROE of 10%

Evolve and grow into a “Global
Wacoal” by capitalizing on quality
and our heightened sensibility toprovide each customer with physicaland emotional beauty andenrichment

Creating Expectations
Create New Businesses in the Health Area
 eturn existing business to a growth ­trajectoryR(Wacoal Corp.)• Existing businesses’ sales revenue: ¥110 billion• Operating margin: 8%• Domestic market share 30% (Approx. 6% growth comparedwith FY2021)
Grow new businesses (Sales revenue: ¥20 billion)

Grow in the European and Indian Markets
Achieve growth in overseas businesses• Sales Revenue: ¥108 billion(¥7 billion in the Indian market,¥3 billion in the German market)• Operating margin: 10%
Overseas sales ratio: 40%

Strengthen Efforts Done Together with Stakeholders• Achieve global growth• Provide greater value and expand our business areas• Create a culture where diverse human resources can play
active roles

Meeting Expectations• Have an operating margin and ROE approximately 10%• Address material issues(Strengthen responses to environmental and social issues)

Fulfilling Commitments• Continuously improve the executive compensation
system• Optimize the Board of Directors’ member structure• Optimize the capital structure chieve zero in-house emissions (Domestic offices)A
Use 50% environment-friendly materials (Wacoal Corp.)
Achieve zero product waste (Wacoal Corp.)
Reduce supply chain emissions (Scope 3) by 20%(Wacoal Business (Domestic))
Fields to Be Expanded

BeautyStrive to continuously provide greater value andachieve discontinuous growth​

Domestic

ExpandComfort• Utilize 3D physique measurement data, R&D

companies

ExpandCultivate

results, and employee ideas• Promote active M&As and collaboration with other

HealthExpandCultivate

Cultivate

Multi-dimensional andAccelerate Global Growthhighly individualized sensibility andproduct quality• Realize growth in countries where we already havea presence (the United Kingdom, the United States,

Overseasand China)• Advance initiatives to achieve widespread brandawareness in India and Continental Europe• Realize transformation into a high-revenue structure

We will cultivate and expand the beauty, comfort, and health areas withnew products and services backed by quality and our heightened
sensibility

I N T E G R AT E D R E P O R T 2 0 2 249

New Medium-Term Management Plan (Fiscal 2023–Fiscal 2025)
The period from fiscal 2023 to fiscal 2025 will be critical for laying foundations that will enable us to realize the goal of VISION
2030, which calls on us to evolve and grow into a “Global Wacoal Group” by capitalizing on quality and our heightened sensibility
to provide each customer with physical and emotional beauty and enrichment. As a manufacturer that markets brands globally,
we will help enhance the day-to-day lives of many people and transform into a highly profitable entity capable of sustained
growth by concentrating on the following initiatives of the medium-term management plan.

Main Goals of Initiatives Creating Expectations

Meeting Expectations

Fulfilling Commitments-Return the Wacoal Business(Domestic) to a growth trajectory-Strengthen potential for growth in the
Wacoal Business (Overseas)-Promote a human resources strategy
that supports growth-Complete domestic structural reform-Achieve ROE above capital cost
-Strengthen responses to human rights
and environmental issues-Disclose the process for achieving our
ROE target (Reform the revenue structure and improve capital efficiency)-Continuously improve the executive
compensation system

Core Management Strategies 
The domestic business will increase sales and become highly profitable by continuing to move forward with its customer experience strategy and to implement structural reforms. Meanwhile, the overseas business will ensure strong growth by accelerating
digital transformation in countries and regions where the Group has a well-established presence while stepping up the development of markets with significant growth potential, such as Germany and India. We also aim to strengthen Group management
capabilities. To this end, we will continue efforts to improve the efficiency of production bases, thereby building a system that canadapt to dramatic changes in the business environment. In conjunction with these initiatives, we will continue to strengthen ourgovernance capabilities so that we can steadily advance our growth strategy and achieve targeted results. The Group will also
develop and acquire personnel who can create new value. In addition, by shifting to more capital-efficient business management,
we will cement our management foundations. Through the aforementioned initiatives, we will advance sustainability-driven
management that both tackles social issues and achieves sustained growth.

Domestic Businesses
Shift to a Resilient
Corporate Structure

Overseas Businesses
Accelerate Global Growth

Sustainability
Promote Efforts That
Address Material Issues

Financial Affairs
Generate ROE That
Exceeds Capital Cost

50

WacoalPromote customer experience strategy and marketing innovation(Achieve regrowth)
Continue reforming the cost structure (Improve profitability)

P.52–

Domestic Subsidiaries
Deal with unprofitable businesses (Improve profitability)–Increase customer experience value by combining our online and offline
operations
Acquire new customers via stronger digital marketingIncrease loyalty of existing customers by utilizing data and strengthening­customer relationship management

P.56–

Put the WACOAL Way into practice and enhance competitiveness to augmenthuman capital and bolster the organization’s capabilities
Strengthen responses to increasingly severe human rights and environmental
issuesPromote innovation based on co-creation to generate social value–

Improve profitability and capital efficiency
Increase the transparency of corporate governance
Eliminate serious compliance violations

I N T E G R AT E D R E P O R T 2 0 2 2.60–

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Medium-Term Management Plan Targets 
Net Profit Attributable to
Owners of Parent

Sales Revenue

Business Profit

Aim to restore growth,
primarily in the domestic andoverseas Wacoal businesses

Accelerate the shift toa resilient corporate structure¥220 billion¥16 billion¥220.0 billion¥205.0 billion

FY2023targetAchieve EPS growth byactively returning profits toshareholders

Aim to surpass our highest net
profits of ¥12 billion¥12.5 billion¥16.0 billion

FY2025target¥200 or more

¥12.5 billion¥7.0 billion

FY2023targetEarnings per Share (EPS)¥200 or more

¥97

¥5.5 billion

FY2023targetFY2025targetFY2023targetFY2025targetFY2025targetBusiness Profit Plans by Segment We aim to achieve an overall margin of 7% ormore by fostering domestic and overseas
sales and increasing revenue

Business profit

Business profit
10% line¥10.0 billion

Wacoal Business(Overseas)
Business profit margin:

7% (¥6.2 billion)

Maintain growth in the
United States, Europe, andChina, and make IO, Inc.
profitable

WacoalBusiness(Overseas)

Wacoal Business(Domestic)
Improve profitability
by returning to a growthtrajectory and making
progress on personnel
planning

Peach John

Other
Business¥5.0 billion

Maintain highlevels of profitability

2.3 billion (incl. ¥1.6¥

billion from Peach John)• Peach John: Maintainhigh levels of profitability• Other: Take into account business portfolios and businesses'
futures and continue adjusting them

• Grow along with profitability
centered around e-commerce• Shift IO, Inc. to a profitablestructure

Wacoal Business(Domestic)

Other Businesses

Business profit margin: 7%• Deal with unprofitablebusinesses• Reform the cost
structure• New M&As(¥7.5 billion)¥50.0 billion¥100.0 billion

Sales
revenue•Make Wacoal more profitable byreturning to a growth trajectoryand making progress on personnel planning management

Medium-term management plan (FY2023–FY2025)
Actual FY2022 results

Financial Indicators 
FY2023 plan (First year of mediumterm management plan)

FY2025 plan (Final year of mediumterm management plan)

3-year total¥6.5 billion¥16.5 billion

–

ROE

–

6.0%

–

Reduction in strategic shareholdings––¥10.0 billion or more

Dividends per share

¥80

–

–

Total dividends––

About ¥20.0 billion

Share buybacks (FY2023 implementation)¥10.0 billion–¥10.0 billion

Growth investments or additional returns(Share buybacks)––¥20.0–¥30.0 billion¥6.0 billion–¥7.0 billion¥6.0 billion–¥7.0 billion

About ¥20.0 billion

Operating profit

Investments in existing businesses

I N T E G R AT E D R E P O R T 2 0 2 251

Business Strategy—Wacoal Business (Domestic)

We will advance our customer experience strategy,
develop new businesses, and shift to a resilient­corporate structure.
Three Years That Highlighted
Wacoal Corp.’s Issues

Tomoyasu Ito
Representative Director, Vice President
and Executive Officer
Wacoal Holdings Corp.
Representative Director,
President and CEO
Wacoal Corp.

52

I N T E G R AT E D R E P O R T 2 0 2 2

In the final fiscal year of the previous
medium-term management plan,
which ended March 31, 2022, theWacoal Business (Domestic) recorded
net sales and operating income significantly below target. These regrettablebusiness results reflect the long-term
impact of the COVID-19 pandemic,
which has changed lifestyles both inJapan and overseas. The extraordinary
conditions produced by the pandemic,
which could not have been predicted
when the previous plan was being
formulated, highlighted issues in thebusiness structure of Wacoal Corp.,
including weak relationships withindividual customers, a high-cost
structure, and a standard businessmodel based on distribution channels.
Going forward, we will deepen relationships with customers through ourcustomer experience strategy and shift
to a resilient corporate structure.
Before the pandemic, we recognizedsome of the aforementioned issues,
and we were working on improvements. Nonetheless, the pandemic
exposed our weaknesses. On the other
hand, one achievement under theprevious plan was that we advanced
business structural reforms with asense of urgency because the environmental changes and sense of crisis
accompanying the pandemic deepened
employees’ understanding of existing
initiatives, such as our customer experience strategy, cost structure reforms,
and a customer-oriented approach tolifetime value and personalization.

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Review of Fiscal 2022
Throughout fiscal 2022, ended March
31, 2022, sales at brick-and-mortar
stores were lackluster due to constraints on activities, including theissuance of state of emergency declarations and measures to prevent widespread infection. Further, these
conditions prompted some businessclients to curb their purchasing,
thereby delaying the recovery of oursales. Meanwhile, e-commerce net
sales were 3.0% above the high sales
level of the previous fiscal year, when
we captured stay-at-home demand.
This year-on-year increase stemmed
from the success of activities to communicate with existing customers
based on our customer experiencestrategy. However, we struggled toacquire new customers.
In April 2021, with the aim of flexibly adapting to changes in distribution
structures, we shifted from a sales
system centered on conventional sales
channels to one centered on regions.
This reorganization has integrated
products, brands, and customer information and advanced our customer
experience strategy, which cultivates
deeper, broader, and longer relationships with customers, but the neworganization has yet to reach its fullpotential. Issues that we have carriedover to the new medium-term management plan include creating pointsof contact not only with existing customers but also with future users of
Wacoal’s products and services, ensuring that the new organization functions properly, and developing brandcommunication that inspires
customers.
A new issue that emerged in fiscal
2022 is the fragmentation of supply
chains. Until now, we have used a
self-contained business model inwhich all supply chains are in-house,
except for fabric manufacturing. Thismodel has enabled the timely deliveryof high-quality products to customers.
Recently, however, due to the prolonged global pandemic, Vietnam
Wacoal Corp., which operates some ofour main sewing factories, halted
operations for about three months,

delaying the supply of products. These
delays made apparent the vulnerabilityof a business model that used to be astrength. Fiscal 2022 convinced me of
the urgent need to review the speed
and flexibility of decision-making withrespect to such matters as how to use
our supply chains organically when aglobal crisis of this type occurs and, if
we cannot use them, how to use external resources. To accelerate decisionmaking, in April 2022 we changed to asystem that empowers executive officers and general managers with highlevels of expertise in their fields of
responsibility to make decisions on
their own authority. By promptly analyzing the causes of issues and implementing countermeasures, we willbuild a stronger organizational
structure.
While reforming the structure of ourorganization, we have also focused onreforming cost structures, and these
efforts are producing results. As apercentage of sales, the optimization of
personnel expenses through the management of personnel plans has notreached the target level due to thedelayed recovery in sales. On a monetary basis, however, this optimization
has progressed largely as planned. I
believe that this achievement is attributable to the efforts of individual
employees.
VISION 2030 and a New Mission
In June 2022, the Wacoal Groupannounced VISION 2030, which is amedium- to long-term management
strategy framework, and a new mission. The latter and material issues
were mainly formulated by younger
employees under the leadership ofexecutive officers. As the owner of the
project, I participated in a range of
discussions and supported the drafting
efforts.
Ultimately, we decided to change
the structure of the Group Philosophy
for the first time since our founding,thereby defining the new Mission that
the Group should fulfill in modern
society. Specifically, we repositioned
the existing elements of the Group
Philosophy—Our Mission, Our Culture,

and Our Value—and reestablished themas Our Promise, Our Culture, and Our
Values under the Founding Principles.
The aim of formulating the new
Mission is to enhance the capabilities
of individuals, increase the power ofthe whole organization, and, as a consequence, raise the enterprise value ofthe entire Wacoal Group by aligningand creating a sense of ownershipwith respect to the goals of the senior
management team and those of all
Group employees. I want the new
Mission to give Wacoal employees
working in regions worldwide arenewed sense of having shared aspirations. Going forward, we will focus
on ensuring that all employees fully
understand the new Mission and fostering a culture in which collaboration
aimed at realizing ambitious initiatives
is a matter of course.
Return to Growth and Construction of
a Resilient Corporate Structure
Ending in fiscal 2025, the new
medium-term management plan
covers an important three-year period
when we will lay the foundations forrealizing the goals set for the Wacoal
Business (Domestic) in VISION 2030,
which calls on us to improve domestic
profitability and expand our businessfields. To this end, under the plan thecore strategy of the Wacoal Business(Domestic) will be to shift to a resilient
corporate structure, and we are determined to once again achieve growthand improve profitability.
In realizing the return to growth, wewill continue advancing our customer
experience strategy and step up marketing, which we view as a weakness.
We will provide customer experiencevalue that reflects diversifying consumer priorities by establishing deeper,
broader, and longer relationships witheach customer. More specifically, we
will enhance store value through theprovision of such differentiated services as 3D smart & try, establish product lineups and develop stores inaccordance with regional characteristics, increase the coordination of
online and offline operations,strengthen e-commerce through the

I N T E G R AT E D R E P O R T 2 0 2 253

Business Strategy—Wacoal Business (Domestic)

upgrading of websites, and conduct
effective marketing by analyzing andutilizing customer data obtained frombrick-and-mortar stores and e-commerce platforms.
Further, to increase our brand power
and product development capabilities,
we have already completed a phase ofbrand consolidation and put in place asystem that concentrates on the ninecore brands. As I mentioned, we faceissues related to brand marketing andcommunication. Therefore, we will
steadily address these issues anddevelop robust brands that are in stepwith changes in customer values andconsumer behavior.
Beginning from the current fiscal
year, we are reorganizing sections
under the umbrella of the Marketing
Management Division. with the aim ofbolstering marketing functions andpromoting our customer experiencestrategy—areas in which the department will be responsible for advancing
initiatives. At the same time, we will
actively develop new products that
embody respective brand stories andmatch the sensibilities of customers.
To increase enterprise value overthe medium to long term, we will also
pursue three types of new businessdevelopment. The first type will
explore new business formats throughresearch at the Human Science
Research & Development Center andthrough industry–academia collaborations. We have already begun working
on the development of these types ofbusinesses, and in the areas of beauty,
comfort, and health we expect to beable to demonstrate the results of these
efforts by next spring. Second, we willdevelop new business fields by extending the applications of 3D body scanners. While continuing to develop
Wacoal products and services thatutilize the measurement data from 3Dbody scanners, we will take on thechallenge of creating new businesses
through collaborations with othercompanies. The third type of business54

I N T E G R AT E D R E P O R T 2 0 2 2

development will be led by the Future
Business Development Department,
which we have established to solicit
and commercialize in-house businessideas. The new department has alreadycollected some highly feasible proposals. Moreover, we have launched new
projects that bring together personnel
from completely different departments
who have proposed similar ideas.
Although they have not yet resulted incommercial products, these initiatives
are making tangible progress andpromise to produce benefits going
forward. I am confident that thesethree types of business development
will further enhance customer experience value by fostering relationships
with customers based on completely
new points of contact.
In conjunction with the aforementioned efforts, we will improve profitability by continuing the steady reformof cost structures through management of personnel plans and othermeasures.
A More Adaptable Organization
In an era of volatility, uncertainty,
complexity, and ambiguity, the Wacoal
Group must realize the forward-looking
evolution of its corporate culture inorder to continue providing the value
expected by customers as well as succeed both in addressing social issues
and advancing businesses. We recognize that diversity is the key to generating and giving concrete form to ideasthat create new value. A good example
is the 3D smart & try measurement
service enabled by 3D body scanners.
A solution to customers’ issues wasarrived at through discussion andcollaboration that included external
stakeholders, and which transcended
the boundaries separating the divisions that are engaged in human science research, planning, and sales.
Diversity was also of critical importance in realizing the service. If we
adopt this multifaceted approach when

considering the management of store
operations and the issue of area marketing, I believe that we will be able toidentify solutions. New ideas will
emerge if we can change from thepersonnel of a single department considering what measures to take for aparticular store to considering from avariety of perspectives the presence
and roles of stores in a particular area.
In other words, the aim of our reorganization is to share information acrossdivisional boundaries and promote thecreation of new value by incorporating
diverse perspectives. Another important factor is time awareness. We wantto evolve into an organization that ismore focused on what, when, and how
measures should be taken as well as
the time frames within which results
have to be produced.
Group personnel are still in the habitof trying to come up with answers
within divisions, and customer issues
are becoming more complex andvaried. In resolving such issues andachieving results, personnel must beable to establish interdivisional collaborations and find other willing
participants. With this in mind, we arecommitted to actively fostering leaders
who combine curiosity with considerateness. At the same time, we will
focus on creating a nonhierarchicalorganization that enables many different personnel to participate in the
resolving of issues.
The three years of the new
medium-term management plan will
be extremely important, not only in
relation to achieving VISION 2030 but
also in terms of meeting the highexpectations of Wacoal’s stakeholders.
Without slackening the pace ofreforms, all employees will make aconcerted effort to build a resilient
corporate structure that heightens theeffectiveness of initiatives and returns
the Wacoal Group to a growthtrajectory.

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

CustomerExperience
Strategy

We will capitalize on digital technologies to build deeper,
broader, and longer relationships with customers.

To achieve further growth, Wacoal Corp. is developing and advancing a customer experience strategy, which increases lifetime
value by utilizing digital technologies to build deeper, broader, and longer relationships between customers and Wacoal Corp.
In fiscal 2022, we completed the integration of customer data that had been held separately by respective sales channels. As aresult, we now have a more accurate understanding than ever before of customer psychology and behavior as they pertain to whichcustomers find value in which Wacoal products, brands, and services as well as where purchases are made. Moreover, we can now
provide information on our products, brands, and services based on the characteristics of each individual customer.
By utilizing the aforementioned customer data and digital technologies, we are reconstructing our entire value chain—from
product development through to sales—from the customer’s perspective, thereby enhancing customer experience value and ourrelationships with our customers. In this way, we will increase lifetime value by attracting new customers and heightening theloyalty of existing customers.

Initiatives to Build a Customer-Focused Value Chain
Sales (Brick-and-Mortar Stores and Websites)

Research and Development

Advancing an area strategy
Promoting brand deployment and sales channel development according
to customer characteristics in each region

Developing products that meet current customer needs
Designing products that effectively appeal to customer psychology andchanges therein

Enhancing store value
Stepping up the rollout of 3D smart & try and Ava.Counseling Parler(avatar-enabled counseling)

Creating highly functional and personalized products based on customer data
Developing products and services that utilize purchasing and­measurement data

Strengthening e-commerce
Utilizing customer data to bolster the linkage of e-commerce with storesand enhancing the convenience of websites and apps

Advancing research and development that results in the provision of newvalue to customers
Developing products and services that exceed customer expectations

Marketing

Product Planning and Production

Moving forward with the building of a customer-focused value chain
Increasing coordination throughout the value chain to enable analysis
and utilization of customer data

Cultivating core brands
Fostering brands that effectively appeal to customer psychology and towhich customers become strongly attached

Distributing personalized information to customers
Providing information corresponding to the needs and characteristics ofindividual customers

Optimizing product mixes based on customer data
Forming brand portfolios and product mixes that reflect diversifying
customer needs

Realizing a cross-brand and cross-sales channel marketing strategy
Strengthening our brand marketing strategy that laterally spans theorganization

Planning and manufacturing products that provide new value to customers
Providing products that exceed customer expectations

Key Performance Indicators ot the Customer Experience Strategy
Based on the above, we have set out key performance indicators so that we can better track our progress in advancing ourcustomer experience strategy. These indicators include thenumber of Wacoal members, the number of Wacoal members
making purchases, and sales to Wacoal members (customer
data that is derived from statistics on trends among Wacoal
members); self-managed sales as a percentage of sales; andthe number of app downloads, which strengthen e-commerceand relationships with customers.
Wacoal sales(incl. internal sales)
Self-managed sales(in-store + in-house
e-commerce)
Self-managed sales(in-house e-commerce only)*
Ratio to sales
Sales to members(based on retail prices)

FY2022 results

FY2023 estimates

82.8 billion¥¥

34.0 billion
41.0%¥11.0 billion
13.3%

¥

104.4 billion

41.0 billion
39.3%¥14.0 billion
13.4%

FY2024 estimates

FY2025 estimates¥

108.0 billion¥

45.0 billion
41.7%¥17.5 billion
16.2%

51.0 billion
46.3%¥23.0 billion
20.9%

¥

¥

110.0 billion¥¥

34.3 billion¥

44.8 billion¥

53.2 billion¥

Wacoal members(number of registeredmembers)

7.35 million

8.40 million

9.40 million

10.30 million

Wacoal members(who have made purchases in
the last 5 years)

4.40 million

5.10 million

5.80 million

6.60 million

2.10 million

2.50 million

2.90 million

3.30 million

28.6%
2.00 million

29.8%
3.00 million

30.9%
4.00 million

32.0%
5.00 million

Number of members making
purchases
Ratio to Wacoal members
Number of WACOAL CARNET(app) downloads

peoplepeoplepeoplepeoplepeoplepeoplepeoplepeoplepeople62.3 billion
peoplepeopleTargets for the Numbers of Wacoal Members Making
Purchases during the Period of the New Medium-Term
Management Plan(Unit: Million people)

Approx. 2.1
million people
Number of
Wacoalmembers
makingpurchases
Number ofnonmembers
makingpurchases(estimate)

Approx. 3.3
Approx. 2.9
Approx. 2.5
million people
million people million people

1.12

1.35

1.61

1.38

1.55

1.69

4.12

4.56

4.29

4.15

FY2022
results

FY2023
estimates

FY2024
estimates

FY2025
estimates

0.91
1.16

Number of nonmembers making purchases (estimate)
New Wacoal members
Existing Wacoal members

people* Mail-order catalog sales included

I N T E G R AT E D R E P O R T 2 0 2 255

Business Strategy—Wacoal Business (Overseas)

Acceleration of strategies aimed at customer­experience enhancement together with further
strengthening of the e-commerce business will drive
the Wacoal Group’s growth.

Masaaki Yajima
Director, Executive Corporate Officer
and Head of Global Operations Div.
Wacoal Holdings Corp.

Fiscal 2022 Performance Evaluation
Although the COVID-19 pandemic
affected the Wacoal Business(Overseas) in fiscal 2022, ended March
31, 2022, due to the easing of restrictions on activities Wacoal Europe Ltd.
and Wacoal America, Inc., recorded
significant recoveries in the sales of
e-commerce platforms and brick-andmortar stores. Consequently, the business posted net sales and operating
income that surpassed pre-pandemic
levels to set new records. Further, inAsia, excluding China, progress

56

I N T E G R AT E D R E P O R T 2 0 2 2

in improving profitability outweighed
the pandemic’s impact, resulting inbusinesses narrowing their deficits orrealizing profitability.
Meanwhile, U.S. subsidiary
Intimates Online, Inc., saw its deficit
increase due to a deterioration in theefficiency of the LIVELY brand’s marketing, attributable to a hike in social
networking service advertisingexpenses and regulatory restrictions
on targeted advertising. As for businesses in China, profit declined
because the e-commerce businessstruggled amid intensified competition
with emerging brands. Thus, ourbusinesses in both the United States
and China face issues that need to beaddressed.
Fiscal 2022 Achievements andFuture Strategies
Partly reflecting efforts begun before
the pandemic to strengthen the e-commerce business throughout the Group’s
overseas businesses, in-house andexternal e-commerce net sales are
steadily rising in the United States andEurope. Further, in Southeast Asia—
where the percentage of net sales
accounted for by e-commerce net sales

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

has been low—this percentage is
steadily rising thanks to the Global
Division’s drive to introduce a common
e-commerce platform across Asia. I
believe that e-commerce will be thekey to growth in the region going
forward.
Based on an overriding customer
experience strategy, we will accelerate
growth globally by enhancing customer experience value through the
combination of online and offline
operations, by acquiring new customers through increased digital marketing, and by earning the loyalty ofexisting customers through the utilization of data and the reinforcement
customer relationship management.
United States
Wacoal America maintained high sales
levels at both brick-and-mortar ande-commerce stores due to a recovery inconsumption accompanying theresumption of economic activities anda pickup in brick-and-mortar store
visits. At the same time, the subsidiaryaugmented core systems with a view
to further growing e-commerce. For
example, we invested in the development of the mybraFit™ digital measurement application and the introductionof a logistics system for the delivery ofindividual items. We will leveragethese investments to grow profits fromthe current fiscal year onward.
Although still in the red due to a reduction in the cost-effectiveness of advertising that is stemming from
regulatory restrictions on targeted
advertising, Intimates Online will
return to profitability by strengthening
management collaboration with theGroup through Wacoal America andrapidly establishing alternative advertising and promotion methods. Moving
Intimates Online into the black by
fiscal 2024 is a mission that must be
accomplished.
Another task is adaptation to logistics disruptions and rising costs. Since
the second half of fiscal 2022, transportation costs and raw material costs
have continued to rise, and the pressure on profits is becoming a serious
problem. As they have been unable toabsorb these cost increases solely
through improvements in production
and logistics operations, Wacoal

America and Intimates Online havealready raised prices. We will continue
to carefully monitor cost hikes andtake additional countermeasures as
required.
EuropeWith the easing of pandemic-related
restrictions, Wacoal Europe achieved aV-shaped recovery and secured an
operating margin above 10.0%. The
subsidiary has long had an operational
structure suited to achieving highlevels of profitability. As well as continuing products (mainstay products
accounting for around 70.0% of its
product lineup, Wacoal Europe uses abusiness model that does not deploy
in-store sales personnel. Anotherfactor contributing to the significant
recovery has been an increasing trend
toward body positivity* and theaccompanying growth in demand for
products in larger sizes—a category inwhich Wacoal Europe has particularcompetence.
Wacoal Europe will achieve growthby introducing the 3D smart & try bodyscanner system to the United Kingdom
and offering customer experiencevalue that seamlessly integrates online
and off line services. Further, we willconsider introducing these integrated
services to France and other European
countries. As for Germany’s market,
where we anticipate scope for growth,
we will launch our own e-commerce
website, and in advancing measures toopen up this market we will keep
M&As in mind as an option. My
impression is that all age groups inEurope are very interested in finding
the types and sizes of innerwear best
suited to their own physiques. With
this in mind, I believe the introductionof 3D smart & try provides an opportunity to elevate brand value and appeal
among customers of all ages.
* A social movement that advocates shifting from asociety that expects women to conform to certain
physical standards, even if achieving this can beharmful, to a society in which diversity in appearance is viewed positively and women feel more
confident in their physiques

China
In China’s e-commerce market, which
for us has been the driver of thecountry’s overall market, we are continuing to struggle due to intensifiedcompetition with emerging brands anda decline in our positioning. In a largescale sale on Singles’ Day, November 11,
the combined sales of Wacoal and fourother major innerwear manufacturers
were less than the sales of one emerging manufacturer. I view this disappointing performance as a major signof being unable to keep up withchanges in the market.
To achieve a turnaround in
e-commerce sales, we will tap demandby advancing a new strategy for products that reflects the characteristics of
e-commerce customers. As well as
regular advertising, we will also
actively incorporate live commercethat utilizes key opinion leaders, also
known as influencers. Tmall currently
accounts for approximately 90.0% oursales through third-party e-commerce
websites. However, we will increase
sales through other e-commerce websites by coordinating with Jingdong
and WeChat.
With respect to brick-and-mortar
stores, as personnel expenses associated with beauty advisors account for
about 20.0% of personnel expenses,
reforming this high-cost structure isan urgent task. Accordingly, we will
explore ways of heightening the efficiency of store management. Also, wewill pursue growth by supplementing
our operations in department storesthrough the increased development of
directly managed stores, which operate
in malls and other locations.
Asia
Partly due to the COVID-19 pandemic,
the business results of our subsidiaries
in Asia were unfavorable. Moreover,business development in the region
has been primarily focused on brickand-mortar stores. The consequentdelay in developing e-commerce­exacerbated lackluster performances.
In accordance with the new
medium-term management plan, we
will increase sales revenue andimprove profitability by reorganizing
sales capabilities to reflect the characteristics of each market, by expanding
e-commerce, and by enhancing theefficiency of businesses. With the aimof improving business efficiency, in

I N T E G R AT E D R E P O R T 2 0 2 2

57

Business Strategy—Wacoal Business (Overseas)

April 2022 we established an organization in Singapore to oversee sales
in Asia. This new organization willlead efforts to improve business efficiency throughout Asia by providing
management support to each subsidiary in the region and promoting theformulation and implementation ofcommon measures.
With regard to the delay in developing e-commerce, the developmentof an e-commerce platform that canbe used by all subsidiaries was completed during the previous mediumterm management plan. Subsidiaries
in Malaysia and other countries havealready begun using the platform.
Going forward, we will expedite sales
growth through the introduction of
the e-commerce platform to othersubsidiaries as well as through thestandardization of products offered in
the region.
Medium- to Long-Term
Growth Strategies
Based on VISION 2030, which wasannounced in June 2022, we will position the European and U.S. markets as
growth drivers; realize sustained
growth in Europe, the United States,
and China; open up new markets; andestablish high-profit structures in all
regions. Through these strategies, we
aim to achieve sales revenue of ¥108.0
billion and an operating margin of
10.0% by fiscal 2031.
In existing markets, we will primarily grow by accelerating digital transformation. Through stepped-up
marketing that capitalizes on digitaltechnologies, we will heighten brandrecognition and attract more newcustomers. In addition, the Wacoal
Group will earn the loyalty of existingcustomers by using customer data tostrengthen customer relationshipmanagement, thereby increasing the
lifetime value of customers in eachcountry and region. For the overseas
business as a whole, the numericaltarget is to increase e-commerce sales
revenue to 50.0% of sales revenue.
Among new markets, we will focus
efforts on India and Germany because

58

I N T E G R AT E D R E P O R T 2 0 2 2

we view them as markets with a great
deal of potential for sales growth. By
fiscal 2031, we expect to realize sales
revenue of roughly ¥7.0 billion in India
and about ¥3.0 billion in Germany.
The purchasing power of India’s
wealthy is likely to increase even further, and the country’s market is
expected to expand even further. On theother hand, as tariffs are extremely
high, our price competitiveness is weakin India. Therefore, we are exploring
ways of raising the domestic procurement percentage to 25.0%, which would
mitigate this issue. We will move forward at a rapid pace with our sights set
on realizing sales revenue of ¥7.0 billion, which is a key performance indicator set in VISION 2030.
In Germany, as I mentioned, we willdevelop the country’s market while
establishing and advancing in-house
e-commerce. At the same time, we will
actively consider M&As with partners
that offer opportunities to expand in
business fields beyond those of Wacoal
Europe, such as products targeting
Generation Z customers and services
dedicated to e-commerce.
Role of the Global Division
Thorough localization is a differentiating feature as well as the greatest
strength of the Wacoal Group’s overseas businesses. We have achieved
growth by having local employees leadthe development and marketing ofproducts optimally suited to the customers living in each country andregion. Meanwhile, the Global Division
has been responsible for sharing information on the products and sales promotion methods developed byrespective overseas subsidiaries.
Going forward, the division will play
an increasingly important role in supplementing the weaknesses of overseas subsidiaries and thereby
facilitating expansion of e-commercebusinesses and promotion of the customer experience strategy. Also, thedivision’s role is not only to connect
markets but also to propose new business models for growth. As Japan’s
consumer market continues to shrink

amid rapid population decline, theWacoal Group must make the Wacoal
Business (Overseas) a growth driver. To
win out in rapidly changing overseas
markets, making timely decisions andtranslating them into action will beessential. For this reason, we clarified
the chain of command and expedited
decision-making by transferring themanagement of the Global Divisionfrom Wacoal Corp. to Wacoal Holdings
Corp. in April 2022.
Value Provided by a “Global Wacoal”
In the current fiscal year, we established a new common global corporate
message: “Comfortable inside.
Confident outside.” This corporate
message expresses our desire to enrich
lives around the world; help customers
achieve self-realization that is freefrom uniform assumptions about
external beauty; and address social,environmental, and human rights
issues. To both remain needed by andrealize a mission aligned with the
expectations of modern society, theWacoal Group will embark upon acohesive, global initiative to advancesustainability-focused management
and thereby enhance enterprise value.
By ensuring that its employees worldwide are fully aware of this new corporate message, the Wacoal Group,
including the Wacoal Business(Overseas), will make a concerted
effort to increase the pace of initiatives
aimed at further growth. Throughthese initiatives, and in accordancewith the vision of our founder Koichi
Tsukamoto, we will realize a “Global
Wacoal.”MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Net Sales

Wacoal America, Inc.
(Wacoal International Corp.)

Local
currency-denominatedsales revenue CAGR:* 4.0%

Operatingmargin:Sales Revenue (Fiscal 2022)

21.1 billion

8.0%(Wacoal International Corp.)

Local
currency-denominatedsales revenue CAGR:* 40.0%

Operatingmargin:Sales Revenue (Fiscal 2022)

4.0%

4.5 billion¥¥(including internal sales)

Intimates Online, Inc.

Business Income

Fiscal2022 results

Fiscal2025 targets(including internal sales)

Fiscal2022 results

Fiscal2025 targets

Priority Strategies

Priority Strategies

In recent years, the U.S. women’s innerwear market has
seen a significant shift in customer sentiment due to such
trends as body positivity. In addition, the transition to
e-commerce has advanced apace due to the COVID-19 pandemic. Against this backdrop, Wacoal America, Inc., swiftly
recovered from the impact of the pandemic thanks to thesuccess of an early focus on in-house e-commerce andstable customer endorsements of the value offered by thecompany’s brands, namely, high quality and a perfect fit.
The new medium-term management plan calls for
e-commerce-led growth through aggressive investment indigital marketing. We have already made progress in thisregard, including the introduction of a digital fitting app.
Going forward, we will achieve profitable growth by
improving the convenience of our website even further anddeveloping and strengthening logistics capabilities.

Intimates Online, Inc., is engaged in developing LIVELY
brand operations. After joining the Wacoal Group in July
2019, despite the pandemic, the company grew vigorously
as a result of active investment in advertisements on social
networking services. Since fiscal 2022, however, the company’s performance has temporarily leveled off prior to its
next growth phase. This lull reflects the decelerating
growth of the in-house e-commerce business, attributable tothe lower marketing efficiency that has resulted from soaring advertising costs and stricter digital privacy restrictions. Given that turning around the current situation willtake some time, in the first quarter of fiscal 2023 we decided
to switch from an aggressive investment strategy to one
that, for a certain period, will give priority to enhancing
profitability. By coordinating with Wacoal America toenhance management efficiency and by utilizing highly
cost effective sales promotion methods, we will improve
profitability as soon as possible.

Wacoal Europe Ltd.

Wacoal China Co., Ltd.

Local
currency-denominatedsales revenue CAGR:* 6.0%

Sales Revenue (Fiscal 2022)

Sales Revenue (Fiscal 2022)

16.3 billion

Operatingmargin:¥Priority Strategies

Local
currency-denominatedsales revenue CAGR:* 11.0%

8.5%
Fiscal2022 results

Fiscal2025 targets

Although large overall, the women’s innerwear market inEurope is characterized by a lack of major companies, withrespective companies only accounting for relatively small
market shares. Also, the pandemic has rapidly increased
the pace of a transition from brick-and-mortar stores to
e-commerce platforms. In this environment, Wacoal Europe
will take advantage of in-house e-commerce and 3D smart& try to advance a customer experience strategy. By introducing this 3D measurement service to Europe—where
customers rarely measure their physiques—Wacoal Europe
will heighten brand recognition and customer experiencevalue, thereby achieving sales growth while maintaining
the current high profit levels. At the same time, we will seek
growth through the opening up of Germany’s market andother markets with significant potential for growth.

11.7 billion

Operatingmargin:¥( IFRS-based calculation foryear ended March 31, 2022)

5.9%
Fiscal2022 results

Fiscal2025 targets

Priority Strategies

In China, the women’s innerwear market continues to see
strong growth as the country’s middle-income population
expands. Particularly in the fast-growing e-commercemarket, brands from emerging countries are increasing
their presence with affordable products and powerful marketing. In this environment, Wacoal China Co., Ltd., is bolstering rollouts of brands and products that reflect the
attributes of its customers and sales channels. While continuing to increase the development of high-value-added
products as one of our advantages, we will strengthen
coordination between online and offline operations andenhance customer relationship management to attract newcustomers and heighten the loyalty of existing customers.
As for e-commerce, which continues to struggle due toemerging brands, we will achieve renewed growth andreach our targets by implementing a new strategy for
products that is focused on customer characteristics.

* Compound annual growth rate

I N T E G R AT E D R E P O R T 2 0 2 2

59

Financial Strategy

We will implement rigorous measures to transform
into a highly profitable company and forge ahead withthe generation of ROE that exceeds the capital cost.
Review of the Previous Medium-Term
Management Plan
During the previous medium-term
management plan, which covered
fiscal 2020 through fiscal 2022, ourbusiness results were disappointing
and fell short of many numerical targets that were key performance indicators, such as net sales, operating
margin, and ROE targets. We failed toreach targets primarily because the
COVID-19 pandemic affected our operations across the board. Moreover, thefailure of the Wacoal Business(Domestic) to sufficiently adapt to theenvironmental changes caused by the
pandemic was especially regrettable
and an outcome from which we needto learn lessons.
Particularly in fiscal 2022, as aconsequence of being unable to fully
adapt to changes in customer values
and consumption behavior, Wacoal
Corp. recorded operating losses for thesecond consecutive fiscal year. By
contrast, in the United States andEurope, store visits recovered as
restrictions on activities eased, and inJapan, Peach John Co., Ltd., surpassed
its pre-pandemic net sales and operating income levels by offering productsthat resonated with consumers and bycreating buzz through marketing initiatives. With a view to strengthening
relationships with customers andcatering flexibly to changes in purchasing behavior, Wacoal Corp. shifted
the overall orientation of its organization from sales channels to sales
regions in April 2021. Although wehave made some progress in integrating customer bases and realizing
reciprocal customer referrals between
sales channels, the most pressing task
is to expedite the establishment ofcapabilities that deliver the products
customers want, when and where
they want them, regardless of whether

60

I N T E G R AT E D R E P O R T 2 0 2 2

Akira Miyagi
Director, Vice President,
Executive Officer and CFO
Wacoal Holdings Corp.

the sales channel in question is a
department store, general merchandise store, directly managed store, oran e-commerce website.
Progress of Profit Structure Reform
The Wacoal Group is progressing asplanned with profit structure reform,

which is aimed at transforming into a
resilient corporate group through cost
reductions of ¥10.0 billion during
fiscal 2023. Among the main profit
structure reform initiatives, the firstentails reducing expenses at Wacoal
Corp., which met cost targets set for
fiscal 2022 by strengthening cost
control and by curbing personnel

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

expenses through the management of
personnel plans.
The second initiative involves reorganizing and reforming the structuresof underperforming businesses. 		
Thanks to structural reforms ande-commerce growth, Peach John has
become highly profitable. Other domestic subsidiaries, meanwhile, did not
improve their profitability in accordance with the previous medium-term
management plan due to deteriorationin the business environment.
Nonetheless, respective subsidiaries
have changed their cost structures byreforming operations through workforce reorganization and plant closures. As a result, these subsidiaries
will be able to generate profits when
the business environment improves toa certain extent. Beginning from thecurrent fiscal year, we will continue
improving profitability by reorganizing
our businesses in light of their future
prospects and our business portfolio.
Our third profit structure reform
initiative is improving the sales margin
by steadily reducing the number ofbrands and stock keeping units.
However, we must closely monitor
inflationary and exchange rate trends
as well as other cost-increasing factorsthat have emerged recently but were
not anticipated when preparing thestructural reforms.
VISION 2030 and the New MediumTerm Management Plan
VISION 2030, a medium- to long-term
management strategy framework, callson the Wacoal Group to achieve sales
revenue of ¥270.0 billion, an businessprofit ratio of 10.0%, and ROE of 10.0% by
fiscal 2031. Further, in our new threeyear medium-term management plan,
we have established the achievement ofsales revenue of ¥220.0 billion, an business profit ratio of 7.3%, and ROE of 6.0%
by fiscal 2025 as milestones on the way
to realization of the vision.
During the period of the new plan,we will lay the foundations for realizing VISION 2030 by launching an
all-out effort to transform ourselves
into a highly profitable company.
Specifically, we will focus on restoring
Wacoal Corp. to growth and profitability, leveraging e-commerce to expand

overseas businesses, moving U.S. subsidiary Intimates Online, Inc., into theblack, and improving the profitabilityof other businesses.
Among these measures, restoring
Wacoal Corp. to growth and profitability is of particular importance. With
the aim of achieving renewed growth,
the company will take advantage ofthe new functions of its organization,
which has been revamped to enhance
responsiveness to changes in customers and markets. At the same time, thecompany will advance its original
customer experience strategy, using
digital technologies to innovate store
services and link online and offline
operations. We expect that the investments in IT systems and logistics
facilities made as part of our customer
experience strategy during the previous plan will contribute to sales revenue during the period of the new plan,
and we will continue investing in
future growth. Over the past threefiscal years, we have responded tosluggish sales by controlling costs tokeep marketing costs down. However,strengthening our brand power andcustomer communications calls forstepped-up marketing investment.
Even amid the COVID-19 pandemic,
Peach John achieved significant
growth by bringing products thatreflected consumer needs to market
and conducting trend-conscious customer communications. One conclusion to be drawn from this outstanding
performance is that Peach John’s marketing savvy has yet to spreadthroughout the Wacoal Group.
To return to profitability, we willcontinue advancing cost structurereforms, including the management of
personnel plans. Specifically, we will
reduce total personnel expenses as apercentage of net sales from fiscal
2022’s 33.6% to 25.0% or lower by fiscal
2025. Although at first glance this may
seem an ambitious target, the percentage is more than achievable if viewed
based on the level of sales revenue
prior to the pandemic. As well as thoroughly revising duties to lower
employee numbers and to optimallydeploy employees, we are seconding
some employees to other companies.
The aim of secondments is not simply
to reduce employee numbers but rather

to provide employees with useful
opportunities to hone their skills andgain experience working at othercompanies.
In the medium to long term, whilestabilizing the profit structures ofexisting businesses, we plan to venture
into new business fields in Japan andexpand our businesses overseas incountries and regions that we have notyet entered in earnest, such as India
and Germany. Naturally, while supporting growth through the use of M&As
and other means as required, we will
also steadily progress toward the realization of VISION 2030.
Capital Policy
Initially, our capital policy under theprevious medium-term management
plan was to maintain a sound balance
sheet, enhance shareholder returns,
and improve ROE. However, in reaction
to the COVID-19 pandemic, we gave
first priority to securing liquidity on
hand and stabilizing our financial base.
Accordingly, we borrowed ¥40.0 billion, suspended the purchasing oftreasury stock, and lowered year-end
dividends. In addition, by securing
cash inflows from gains on the sale ofstrategic shareholdings and sales ofreal estate, we were able to maintain athree-year total payout ratio of morethan 100.0%, even while investing in
the acquisition of U.S. subsidiary
Intimates Online and the establishment of e-commerce distribution centers. However, ROE remained low.
Under the new plan, we will concentrate on increasing profitability andenhancing asset and capital efficiency.
Improving profit margins is essential
to the achievement of higher ROE. As
profit margins are expected to steadily
recover, we will enhance capital efficiency through such measures asproviding shareholder returns. Also, by
fiscal 2025 we will generate ROE thatexceeds the cost of capital—a premisefor the creation of enterprise value.
Guidelines for the financial strategies set out in the new medium-term
management plan are as follows. First,
as in the previous medium-term management plan, we will continue
actively reducing strategic shareholdings. Further, our medium- to

I N T E G R AT E D R E P O R T 2 0 2 2

61

Financial Strategy

long-term benchmark for strategic
shareholdings is 15.0% of net assets orless. With respect to shareholder
returns, as we did during the previousplan, we hope to maintain a three-year
total payout ratio of 100.0%. Also, wewill flexibly purchase treasury stock to
improve capital efficiency. In theabsence of appropriate growth investments, we will provide additional
returns to further improve capitalefficiency.
Our approach to cash allocation
during the period of the new mediumterm management plan will be as
shown in the chart at the bottom of
page 63. Specifically, we plan the allocation of cash flows generated bybusiness activities and asset efficiency
improvement and of cash generated by
the effective utilization of borrowings
to existing investments, growth investments, and shareholder returns. As for
growth investments, we will invest in

IT and digital technologies to promote
our customer experience strategy, andwe will explore opportunities to invest
in new businesses. As well as planningto pay total dividends of ¥20.0 billion
over a period of three years, in May
2022 we announced that we intend topurchase treasury stock of ¥10.0 billion
in fiscal 2023. In addition, plans call for
growth investments of between ¥20.0
billion and ¥30.0 billion in new businesses. As mentioned above, however,if there are no suitable investment
candidates, we will provide additional
returns to improve capital efficiency.
Enhancement of Enterprise Value
through ESG Initiatives
In enhancing enterprise value, environmental, social, and governance(ESG) initiatives are of course also
important. For the Wacoal Group, ESGrelated growth opportunities include

such initiatives as the advancement ofCSR-focused procurement, the reduction of waste, and the marketing ofproducts that meet the needs of manydifferent customers. Further, the establishment of traceable supply chainsand other ESG-focused narratives that
underpin and differentiate brands andproducts will be an important factor inincreasing market shares andrevenues.
In addition to promoting the aforementioned ESG initiatives, we must
gain public recognition of them toeffectively increase enterprise value.
With this in mind, through customer
services at stores, marketing activities,
and investor relations efforts, we willproactively inform customers, consumers, shareholders, and investors
about our advancement of ESG initiatives, thereby heightening trust. From afinancial perspective, such communication activities will also curb the

Financial Policies during the Medium-Term Management Plan (Fiscal 2023–Fiscal 2025)
Primary Management Policies
Work on becoming more profitable as our highest priority and also aim to boost our ROE by improving both asset and capitalefficiency
Prioritize investment in future growth and actively return profits to shareholders to improve our capital efficiency

ROE

Reduce strategic

Shareholders’ equity

Improve the 3-year

6.0%

shareholdings by¥210 billion

return ratio to get to enerate ROE thatG
exceeds capital cost
Work on becoming more
profitable and aim toboost our ROE by
improving both asset
and capital efficiency

62

I N T E G R AT E D R E P O R T 2 0 2 2¥10 billion or
moreContinue actively­reducing strategic
shareholdings
 im for strategic shareA
holdings to make up 15%
or less of our net assets
in the medium to longterm

Continue investing in
growth and improving
profitability and capitalefficiency in order toboost our ROE
Consider utilizing­interest-bearing debt
from the viewpoint of
improving our corporate
value

cumulative total

100% or more
Pay out stable dividends
at approx. a 50% or
higher payout ratio
Flexibly buy back sharesto improve capitalefficiency

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

volatility of our share price. This will
lower capital costs, contributing toenterprise value growth over the
medium to long term.
Responsibilities as CFO
In the current fiscal year, we launched
our new medium-term management
plan. Especially with respect to thedomestic business, we are very muchaware that this will be a year of competition for survival. While doing
everything in our power to cater tocustomers and markets so that we getback on a growth trajectory, we will
rigorously tackle the issues left overfrom the previous plan.
Allow me to reiterate that, in termsof capital policy, we will utilize cash
flows generated and procured throughbusiness activities, better asset efficiency, and financing for existing
investments, growth investments, thepurchase of treasury stock, and theprovision of other shareholder returns
with the aims of growing businesses,
improving capital efficiency, andincreasing ROE.
Since the early 2000s, the Company’s
price book-value ratio (PBR) has averaged below 1.0 times. As CFO, the mostimportant key performance indicatorthat I have set for myself is to restore
the slumping PBR to a level above 1.0
times as soon as possible by heightening the Group’s profitability and capitalefficiency.
Further, in formulating VISION 2030,
the Group’s governance-related material issues were identified as the implementation of highly transparent
management, the strengthening of therisk management system, and thecontinuous improvement of profitability and capital efficiency. Accordingly,
we will continuously strengthenGroupwide governance to addressthese material issues, thereby bolstering the foundations of the organizationand facilitating sustained growth. In
addition, with a view to enhancing theeffectiveness of the Board of Directors,
we will continue reforming the system
for the compensation of officers andoptimizing the composition of theBoard of Directors in terms of ensuringexpertise, independence, and diversity.
Although the business environmentis expected to remain challenging, we
will fully engage with our stakeholders
and make appropriate forward-looking
decisions so that we can advancedecisively toward realizing the goals of
the new medium-term management
plan and VISION 2030.

Plan for Investments and Shareholder Returns (Fiscal 2023–Fiscal 2025)
Growth Investments
Invest in IT and digitaltechnology in order to grow andconsider opportunities to invest
in new businesses

Cash generated in the
3-year period¥55 billion or moreI nvestments in existing businesses: ¥20 billion; Investments
in new businesses: ¥20 to ¥30
billionApprox. ¥27 billion

Shareholder Returns

Depreciation costs
Approx. ¥18 billionWe plan for the total amount ofdividends during this 3-year
period to be ¥20 billion; theCompany will also buy back ¥10billion of its shares in fiscal 2023
I f we cannot find any appropriate
growth investments, we will
give additional returns to further
improve our capital efficiency(¥20 to ¥30 billion)

Net profits

Sale of strategic
shareholdings¥10 billion or more

Existing investments¥20 billion

Existing
investments
Shareholder returns

Shareholder
returns

GrowthinvestmentsorMake assets more efficientUtilize debt

Increase capitalefficiency

Total of dividends in the 3-year period(¥20 billion)
Share buybacks in the FY2023(¥10 billion)¥30 billion

Growth investments oradditional returns¥20 to ¥30 billion

Initiatives to Improve Management Effectiveness

Push for GroupManagement andMake the Group
More CapableEstablish a highly effective business management system in order toachieve our medium- to long-term targets
Start reviewing the compensation system to make the Board of
Directors more effective

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63

A Discussion among Three External Officers

Reforms Essential for the Realization of VISION 2030
The Wacoal Group has reached a major turning point. We have established a new business management structure andformulated a medium- to long-term management strategy framework and a medium-term management plan. Recently, threeexternal officers discussed the challenges that the Group must overcome to realize its vision, the key points for putting the
WACOAL Way into practice, and the roles external officers must perform to increase the effectiveness of business management.

Tsunehiko Iwai
External Director

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I N T E G R AT E D R E P O R T 2 0 2 2

Madoka Mayuzumi
External Director

Minoru Shimada

External Audit &Supervisory Board Member

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

More Female Officers
Urgently Required
Mayuzumi: Based on my own expertise and attributes, I see my role as toenhance corporate value over the
medium to long term by providing
opinions from the three perspectives ofculture, women, and consumers. In
particular, as an external director I
endeavor to be ever aware of the perspective of women, who make up the
majority of stakeholders, to view matters from both inside and outside theGroup, and to “step on the brakes” whenneeded. For example, the Group is
currently focusing efforts on the 3D
smart & try automated measurement
service, which collects customer datafrom 1.5 million points in the space offive seconds. Given the nature of thisdata, thoroughgoing information security measures are essential. Further, I
also try to raise issues that may bedifficult for men to fully appreciate,such as health issues unique to womenand the particular problems women
have experienced during the
pandemic.
I also wonder if the final decisionsof a women’s innerwear manufacturer
can be properly made solely by those
who do not wear the products. At present, I am the only female officer on the
Board of Directors, but there should be
more female in-house officers on the
Board, an issue that I have been pointing out for some time.
Shimada: When I mention the subject
on the executive side, the response is:“We would like to appoint more female
officers, but it will take another threeor four years.” But this is not the case atall. We must promote women now. In
fact, I know of some very talented
women in the Group. Of course, ability
in frontline operations is different frommanagement aptitude, but that goes formen too. As is often remarked, theposition creates the person. If a person
is appointed at an early stage to theposition of general manager, they willgrow beyond expectations. Wacoal
Corp. currently aims to increase thepercentage of female managers from
27.0% to 30.0% or more. However, ensuring that 50.0% of managerial positions
and 30.0% of executive positions areoccupied by women would be more
appropriate targets to pursue.
Mayuzumi: The lack of female rolemodels within the Group makes fostering female in-house officers challenging. To avoid the appointment of token
female officers, I think we need todecisively appoint a fixed number ofwomen to the Board of Directors fromthe very outset. At the same time, weshould introduce additional measures,such as career breaks and sabbaticalleave, which are becoming common
among companies in Europe. The
Wacoal Group must proactively takethe lead in closing Japan’s gender gap,
which languishes at around 120thplace in the world rankings, andadvance initiatives that are progressive
enough to attract media attention.
Iwai: I completely agree. This issue
needs to be discussed more deeply at
meetings of the Board of Directors.

External versus In-House Logic
Iwai: Along with Mr. Shimada, I was
appointed at the Ordinary General
Meeting of Shareholders held in June
2018. My previous position was at a
cosmetics manufacturer, which, like

Wacoal, is a manufacturer focused on
women’s beauty. Partly because that
position included responsibility fortechnology, my understanding is thatin my capacity as an external director I
am expected to provide opinions on thetechnical and quality-related aspectsof manufacturing as well as opinions
on compliance. Therefore, I never hesitate to speak up on these and othermatters at Board meetings. I believethat this is how a board of directors
should be. The Wacoal Group also has acorporate culture that allows such
uninhibited discussions.
Of the two “gas” and “brake” functions of management, I place particularemphasis on the former. I try to support the executive side by providing
advice on how best to move forward.
Shimada: Although an external Audit &Supervisory Board member, I am
involved in activities that are beyond
the scope of a corporate auditor in the
narrow sense of the term. For example,
I also participate in two committees inwhich you both participate: theExecutive Nomination Advisory andExecutive Compensation Advisorycommittees. Although I am anobserver, in reality I express frankopinions in the same way as othermembers do.

Wacoal needs to advance
progressive initiatives andproactively take the lead inclosing Japan’s significant
gender gap.

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65

A Discussion among Three External Officers

I originally worked in the banking
industry, and subsequently, I also
served as the president of an operatingcompany for a number of years. As aresult of this background, I try to examine the Wacoal Group’s managementfrom the perspective of a business
manager. In other words, I am more
focused on my role as an external
officer than as an corporate auditor. As
is the case in the banking industry, if
you spend a long time in the sameenvironment, you inevitably become
steeped in the common sense of thatenvironment. With the passage of time,
Wacoal’s perception of common sense
and that of society are diverging.
I think one of our roles as external
officers is to draw attention to suchdivergences.
Iwai: I have been told that the discussions at meetings of Wacoal Holdings’
Board of Directors have become much
livelier since Mr. Shimada and I joined
them. What is important, however, isthe degree to which such discussions
are incorporated into daily operations.
Our statements at Board meetings will
be meaningless if in-house logic continues to hold sway in frontline
operations.

Shimada: I would like to call for a further change in mindset on the part of
in-house officers. Although discussions at Board meetings have become
livelier, they have yet to become indepth deliberations on the issues weraise. There is a tendency to try tosmooth over certain agenda items.
I believe Board meetings should be avenue for spirited debate that stems
from the participation of members
who have a variety of standpoints.
Iwai: Several years ago, my former
company underwent a major transformation when it appointed a president
from outside. Looking at the Wacoal
Group today, my impression is that it
resembles my old company on the eveof reform. They have absolute confidence in their manufacturing, and apart of them believes that since theGroup makes such good products, there
can be no reason for them not to sell
well. But this is not an era in which
products can be sold without brandmarketing. Believing that a productwill sell because it is good is an outmoded and complacent attitude.
Related to this point, I am concerned that there is a lack of discussion on manufacturing at Board

All that remains to be seen is how far
employees can reform their own
behavior with a view to realizing
the new Mission. I believe thateverything depends on this.

66

I N T E G R AT E D R E P O R T 2 0 2 2

meetings. For example, if a new brandis to be launched, there ought to befrank exchanges of opinions at Board
meetings regarding the brand story.
Such discussions will also enhancebrand marketing.
Mayuzumi: Unfortunately, the Board
did not have an opportunity to discuss
the development process of the newhigh-end brand Yue, which debuted in
the 2021 fall–winter season. As Mr.
Iwai said, precisely because of theissues with Wacoal’s brand marketing
capabilities, brand-related mattersshould be discussed in more depth.

Beginning of Reform: Will the
Mountain Move?
Iwai: The Wacoal Group’s current situation is truly reflected in the numbers.
While Europe and the United States are
growing, Japan and China are struggling. I see the issues in China as being
related to temporary factors such as
lockdowns. Aside from China, theproblem is Japan. Whenever I makethis point, the answer is that the issues
in Japan are attributable to lower
demand resulting from a declining
population, but business results proveotherwise. Despite being in the same
country and in the same businessenvironment, Wacoal Corp. hasrecorded operating losses for two consecutive fiscal years, while Peach John
Co., Ltd., has posted high levels of operating profit.
Peach John has a fabless businessmodel that is not vertically integrated.
While outsourcing manufacturing, thecompany competes in the arena ofideas by focusing on such areas asplanning, marketing, and advertising.
Analysis of the company’s stunningsuccess clearly demonstrates theimportance of brand marketing.
Regrettably, despite having the example of Peach John near at hand, Wacoal
Corp. has not made progress in transforming its marketing.
Wacoal Corp. also needs to rethink
its approach to quality control. Whileadhering to a system that demands
100% perfection is admirable, theMEETING EXPECTATIONS and FULFILLING COMMITMENTS

company should examine whether thisapproach is incurring extra costs. I
think the time has come to rebuild thequality control system so that it meetsthe needs of the times. This reconstruction should include greater flexibility in the management of
acceptable quality levels.
Mayuzumi: I would like to point out
two medium- to long-term issues.
First, as a company providing products intrinsically related to the human
body, I would like to see an emphasison human physicality. In the current
digital age, metaverses and other virtual worlds are attracting the limelight.
On the other hand, the value of fleshand-blood experiences and reality will
never disappear. In fact, the importance of such experience may, paradoxically, come to the fore. To put it
another way, fusions of the digital andthe real are possible. With this in mind,
I have high expectations of the physique-focused research that the Human
Science Research & Development
Center is conducting in collaboration
with other companies.
The second issue relates to environmental, social, and governance imperatives, especially environmental andsocial initiatives. The Group should
accelerate initiatives focused on ethical consumption, fair trade, organic
products, and local production for local
consumption, and I would like to see
the Group actively tell the outside
world about such initiatives. Wacoal
Group is focusing on socially responsible procurement activities thatinvolve working with contract manufacturers to improve their working
environments. Last year, the Groupbegan disclosing a list of its major
overseas contract manufacturers. The
Group is also promoting traceability inits procurement activities. However,the public is hardly aware of suchactivities. This is related to another of
Wacoal’s problems, namely that it is
not adept at communication.
Shimada: At Board meetings and otherforums I have made three main recommendations. First, the Company needs
to produce specific management

indicators that satisfy investors andmeet their expectations. Second, theCompany should present a growthstrategy aimed at advancing scrapand-build measures in loss-making
divisions and maximizing the use ofhuman, material, and financial
resources. My third recommendation
is for structural reform of business
management that entails clarifying
management responsibility, strengthening global management centered on
Wacoal Holdings, and appointing
female officers. The appointment ofqualified outside and inside officers tofurther enhance the effectiveness ofgovernance is also essential.
To quite a large degree, these recommendations have been reflected in
the recently formulated VISION 2030. I
commend the transfer of the Global
Division to Wacoal Holdings, the establishment of the Sustainability
Committee, and the formulation of the
Guidelines for the Actions of Officers
and Employees. The question is how toensure that everyone puts their heartand soul into these new systems andguidelines going forward, rather thantheir establishment marking the end of
the matter.
Carly Fiorina, an American businesswoman, famously said, “Preserve
the best, reinvent the rest.” This mantra
calls on us to maintain the best traditions while boldly changing those thatare out of step with the times. I fearthat Wacoal Group officers andemployees may lack a sense of crisis in
this regard. The Group has been comfortable with its high shareholders’equity ratio, and net sales haveremained at around the ¥200.0 billion
mark for a long time. Such low growthis unacceptable for a listed company,
and in the coming era steady decline issurely awaiting the Group if it continues to follow precedent and affirm thestatus quo. To put into practice founder
Koichi Tsukamoto’s vision of aiming tobecome a “Global Wacoal,” the Group
must undergo root-and-branch
self-reform.
Our duty as external officers is toencourage an awareness of the needfor reform among members of thesenior management team. However,

only in-house managers can inculcate
an awareness of the need for reform
throughout the organization andensure that the Group’s 20,000 employees own the reform. I hope that theGroup steadily advances reform andchanges mindsets while reporting on
the progress of these efforts to external
officers.
Iwai: Three years ago, when the previous medium-term management plan
was formulated, net sales of ¥300.0
billion and an operating margin and
ROE above 10.0% were established astargets for fiscal 2028. However, theword “vision” was not used at all, nor
was any specific process established.
Subsequently, I emphasized that theprevious plan did not convey a clear
message at all. In this context, I thinkthat VISION 2030 has certain merits.
In relation to the clarification ofmanagement responsibility mentioned
by Mr. Shimada earlier, I think that theclear delineation of the responsibilitiesof the president and CEO (Group CEO),
Hironobu Yasuhara, as well as the
responsibilities of three directors,
namely, the vice president and executive officer, Tomoyasu Ito; the vicepresident, executive officer, and CFO
Akira Miyagi; and the executive corporate officer, Masaaki Yajima, isextremely significant. Also, the establishment of the titles CEO and CFO is
the first step toward a “Global Wacoal.”
I hope that these three directors will
work hard together and lead the
Wacoal Group.
Shimada: Despite having a very conservative personnel policy, the bankthat I used to work for recently madean unexpected appointment to theposition of president, which attracted a
lot of attention because such an
appointment would have beenunthinkable not long ago. This appointment illustrates that the banking
industry feels itself to be on the edge ofa precipice. I hope that the Wacoal
Group’s senior management teamshares this sense of crisis and promotes women and mid-career hires to
officer positions.

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67

A Discussion among Three External Officers

Mayuzumi: I have been observing the
Wacoal Group for eight years since I
became an advisor. Frankly, my
impression is that the Group is conservative, as evidenced by the fact that I
have been the only female director fora long time. Such conservatism is notnecessarily a bad thing; however, theGroup has reached a point where it
must change. As a result of the amendment of Japan’s Corporate Governance
Code, Mr. Iwai and Mr. Shimada havejoined the Board of Directors, which
has increased the liveliness of discussions. I sense that the Wacoal Group is
finally beginning to change.

behavior with a view to realizing the
new Mission. I believe that everything
depends on this.

Organizational Reform throughInternalization of the WACOAL Way
and Middle-Up-Down Management

Shimada: Since such goals and commitments are inevitably abstract, thekey to embedding them in the organization lies with the Guidelines for the
Actions of Officers and Employees,
which were prepared in conjunction
with the restructuring of the WACOAL
Way. I would like officers and generalmanagers to repeatedly discuss with
their subordinates what must be done
now based on these guidelines. Rather
than simply saying, “Here are thebehavior guidelines,” thorough discussion and reinforcement are necessary.
Such real communication is sure tofoster leaders who will spearhead
reform.

Iwai: Recently, the Group defined its
new Mission and updated the WACOAL
Way. I was involved in the formulationof the new Mission as an advisor andoffered a range of advice.
The Wacoal Group has a history
stretching back more than 70 years.
While inheriting corporate DNA thathas been part of the organization since
its founding, the Group must establish
a new iteration of this legacy in lively
modern language. Without a new
expression of its fundamental commitments, the Group will not be able tomove forward as a corporate group.
All that remains to be seen now is how
far employees can reform their own

Mayuzumi: Ensuring that the WACOAL
Way becomes ingrained in employees
and permeates the entire organization
is important. The philosophy’s positionat the core of operations will enable
employees to quickly assess situations
and act in accordance with the philosophy, almost without being aware ofit. This is the degree to which the philosophy must penetrate the organization and become internalized by
employees.
Such inculcation also relates to risk
management. Responding to each risk
based on separate rules would be an
endless task. In other words, unlessrisk management is driven byprinciples rather than rules, risks will
not be reduced and organizational
reform will not progress.
There is a famous study that
focuses on the “kata” routines ofthought and behavior practiced at oneof Japan’s flagship automakers. Suchroutines are the essence of Japaneseculture and can only be masteredthrough repetition. I would like the
Wacoal Group, as a Kyoto-based manufacturer, to set an example by taking
the lead in developing kata routines.
Shimada: I think the two projects
established under the Sustainability
Committee are particularly meaningful. The first of these is the Project toPromote Awareness of the WACOAL
Way. The middle managers participating in this project will rigorously incorporate the new Mission and behavior
guidelines throughout the organization
while seeking reform by placing pressure on the senior management teamfrom below. If this middle-up-down
management takes root, the Wacoal
Group is sure to change.
The other significant project is the
Project to Improve Women’s QOL (quality of life). Both projects should actively
include personnel who put themselves
forward and express a desire to be partof the projects. As the QOL project istasked with enhancing the status androles of women in society, womensympathetic to these goals should beselected as participants.
Iwai: I agree with you entirely. After all,
90.0% of Wacoal Corp. employees are
women.
Shimada: To paraphrase a female character in a television drama upon
encountering the glass ceiling, I thinksetting 50.0% as a target for female
managers would be a good idea.
Alternatively, the Group could aim tohave women account for 30.0% of
officers as soon as possible.
Mayuzumi: Whether for the position of
CEO or other officer positions, theGroup should make it possible to “skip a68

I N T E G R AT E D R E P O R T 2 0 2 2

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

grade.” Without such a level of commitment, I do not think the Group can say
to society, “We have changed.”

Enhancement of the
Wacoal Group’s Enterprise Value
Iwai: Looking at the world today, I havea real sense that shareholder capitalism is approaching a major turning
point. Public interest capitalism or“new capitalism” is an approach thatemphasizes all stakeholders, including
employees and customers. I would likeall Wacoal Group employees to proactively think about how to change theGroup. That is the essence of public
interest capitalism.
In addition, while shareholder
returns are important, fundamentallythe ideal financial strategy is one that
increases enterprise value and shareholder value by investing in growth.
With this in mind, I would very much
like to continue supporting such proactive initiatives as the 2019 acquisitionof Intimates Online, Inc.
Mayuzumi: In improving the Wacoal
Group’s enterprise value, I believe thatlaying foundations both inside andoutside the Group is indispensable.
Internally, the Group needs a framework for principle-based behavior,increased diversity in Board of
Directors, and an organizational culture that empowers women, as I mentioned earlier. Other in-house efforts
should focus on the elimination of
unconscious bias, which we should bewary of precisely because it is unconscious. Given the results of public surveys, the Wacoal Group seems unlikely
to be free of such bias. Also, the Groupneeds a culture that does not conceal
or repeat failures. I hope that the Group
continues rigorously laying suchfoundations.
On the other hand, the establishment of foundations outside the Groupmeans creating a new culture. For
example, for the femcare business
define to succeed, the concept of femcare must first become widely

The Wacoal Group is sure tochange if it embeds and pursues
reform through middle-up-down
management, which places pressure
on the senior management
team from below.

recognized so that femcare products
are used as a matter of course. France
has such a culture, but Japan does not.
Another type of culture lacking inJapan is a “madame” culture. French
culture views mature women as attractive. On the other hand, I think there is
still a tendency in Japan to be overly
concerned about age. Against thiscultural backdrop, many women in
Japan suddenly become “old ladies”
after reaching a certain age andbecome indifferent to their own
appearance. If an “attractive madame”
culture is fostered, mature women may
begin enjoying fashion and taking agreater interest in innerwear. The
development of such a culture will also
require a change in the values of society as a whole.
At one time, the idea of transforming women’s physiques throughapparel did not exist in Japan. By
introducing Western innerwear to thecountry, the Group’s founder Koichi
Tsukamoto revolutionized Japan’s
apparel culture. I hope that the Wacoal
Group creates a new culture with acomparable impact.

Shimada: The management team’s role
is to put spirit into such tools as the
new Mission, VISION 2030, and neworganizations. Therefore, changing themindset of in-house officers is a prerequisite for realizing day-to-day communication that spreads a reformfocused attitude Groupwide.
Another requirement is the utilization of personnel as a management
resource. To repeat, the Group needs tobring forward the promotion of women
to middle management and increase
the percentage of women in management positions.
We must steadily accumulateachievements one at time. Such efforts
will earn the further trust of investors
and other stakeholders and enhanceenterprise value over the medium tolong term. As external officers, we will
do our utmost to help realize a new
Wacoal Group.

I N T E G R AT E D R E P O R T 2 0 2 2

69

Management TeamAs of June 29, 2022

Directors

Representative Director, President and CEO

Hironobu YasuharaMar. 1975 Joined the Company
Apr. 1997	Director and General Manager of
Wacoal China Co., Ltd.
Apr. 2005	Corporate Officer/General Manager of Wing Brand
Business Department of the Company
Jun. 2006	Director and Managing Corporate Officer, General
Manager of Wing Brand Business Department of
Wacoal Corp.
Apr. 2010	Director and Senior Managing Corporate Officer, andGeneral Manager of Wacoal Brand Business
Department of Wacoal Corp.
Apr. 2011	Representative Director, President and Corporate
Officer of Wacoal Corp.
Jun. 2011	Director of the Company
Jun. 2013	Senior Managing Director of the Company
Jun. 2016	Vice President and Director of the Company
Apr. 2018	Representative Director and Chairman of Wacoal Corp.
Jun. 2018	Representative Director and President of the Company
Apr. 2020	Representative Director, President and CEO of theCompany (present)

Tomoyasu Ito

Apr. 1983 Joined the Company
Apr. 2006	General Manager of Sales Planning Division,Wacoal Brand Operations
Apr. 2007	President of Studio Five Corp.
Apr. 2011	General Manager of Innerwear Merchandising
Division, Wacoal Brand Operations
Apr. 2014	Director, Corporate Officer, Head of Wacoal Brand
Operations
Apr. 2015	Director, Managing Corporate Officer, Head of Wacoal
Brand Operations
Apr. 2016	Director, Senior Managing Corporate Officer, Head of
Wacoal Brand Operations
Apr. 2018	Representative Director, President and CEO
of Wacoal Corp. (present)
Apr. 2020	Director, Vice President Corporate Officer of theCompany
Jun. 2020	Director, Vice President Corporate Officer of theCompany
Jun. 2022	Representative Director, Vice President and Executive
Officer of the Company (present)

Director, Vice President, Executive Officer and CFO

Director and Executive Corporate Officer

Mar. 1984 Joined the Company
Oct. 2007	Manager of Business Management andAdministration of Wacoal Brand Operation Division of
Wacoal Corp.
Apr. 2011	Director and Deputy General Manager of
Wacoal China Co., Ltd.
Apr. 2014	General Manager of Corporate Planning of theCompany
Apr. 2017	Corporate Officer of Wacoal Corp.
Jun. 2018	Director and General Manager of Corporate Planningof the Company
Jun. 2019	Managing Director and General Manager of Corporate
Planning of the Company
Apr. 2020	Director and Managing Corporate Officer in charge ofGroup FinanceJun. 2021	Director and Managing Corporate Officer in charge ofGroup Business Management
Jun. 2022	Director, Vice President, Executive Officer and CFO of
the Company (present)

Mar. 1984 Joined the Company
Jun. 2004	Director and President, Wacoal International
Hong Kong Co., Ltd
Apr. 2007	Leader of Sales Group, International Headquarters,
Wacoal Corp.
Sep. 2008	Director and Deputy General Manager,
Wacoal China Co., Ltd.
Apr. 2009	Director and General Manager, Wacoal China Co., Ltd
Apr. 2011	Corporate Officer, Wacoal Corp
Jun. 2015	Corporate Officer and General manager ofTechnology & Production Division, Wacoal Corp.
Jun. 2016	Director, Corporate Officer and General Manager ofTechnology & Production Division, Wacoal Corp.
Apr. 2018	Director, Managing Corporate Officer and General
Manager of Wholesale Division, Wacoal Corp.
Apr. 2021	Director, Managing Corporate Officer and General
Manager of Global Division, Wacoal Corp.
Apr. 2022	Director and Executive Corporate Officer, Wacoal Corp
General manager of Global Division of the Company
Jun. 2022	Director, Executive Corporate Officer and Head of
Global Operations Div. of the Company (present)

External Director

External Director

Aug. 1996	Launched and organized monthly haiku magazine
Gekkan HepburnJan. 2001	Member of National Language Subdivision of Council
for Cultural Affairs, Ministry of Education, Culture,
Sports, Science and Technology
Dec. 2004	Member of Council for the Promotion of Cultural
Diplomacy, Cabinet Secretariat
Apr. 2010	Japan Cultural Envoy for Agency for Cultural Affairs
May 2013	Member of Forum to Realize Culture and Arts-Oriented
Nation held by Minister of Education, Culture, Sports,
Science and Technology
Apr. 2014	Member of Cultural Policy Subdivision of Council for
Cultural Affairs, Ministry of Education, Culture, Sports,
Science and Technology
Apr. 2014	Advisor of the Company
Jun. 2015	External Director of the Company (present)

Nov. 1979	Joined TOSE CO., LTD.
General Manager of Development Department
Oct. 1985	Director of TOSE CO., LTD.
Feb. 1987	Representative Director and President of
TOSE CO., LTD.
Sep. 2004	Representative Director and President, and CEO of
TOSE CO., LTD.
Dec. 2015	Appointed Representative Director and Chairman,
and CEO of TOSE CO., LTD. (present)
Jun. 2017	External Director of the Company (present)

Akira Miyagi

Madoka Mayuzumi

External Director

Tsunehiko Iwai
Apr. 1979 Joined Shiseido Co., Ltd.
Apr. 2002	General Manager of Product Commercialization,
Planning Department, Shiseido Co., Ltd.
Apr. 2008	Corporate Officer, General Manager of Technical
Department, Shiseido Co., Ltd.
Jun. 2014	Director, Corporate Executive Officer in charge of
Research & Development, Production and TechnicalAffairs, Shiseido Co., Ltd.
Jan. 2016	Representative Director, Executive Vice President,
Chief Technology & Innovation Officer,
Shiseido Co., Ltd.
Mar. 2018	Senior Advisor, Shiseido Co., Ltd.
Jun. 2018	External Director of the Company (present)

70

Representative Director, Vice President andExecutive Officer

I N T E G R AT E D R E P O R T 2 0 2 2

Masaaki Yajima

Shigeru Saito

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Audit & Supervisory Board Members

Audit & Supervisory Board Member

Audit & Supervisory Board Member

Mar. 1985 Joined the Company
Apr. 2008	Director and General Manager of Accounting and
Administration Division of Studio Five Corp.
Apr. 2009	Director and General Manager of Business Control
Division of Studio Five Corp.
Apr. 2013	IR/Public Relations Officer of the Company
Apr. 2018	General Manager of Accounting Department of theCompany
Jun. 2020	Audit & Supervisory Board Member of the Company(present)
Jun. 2021	Audit & Supervisory Board Member of Wacoal Corp.
(present)Mar. 1986 Joined the Company
Apr. 2010	Materials Control Manager of Technology/Production
Division of Wacoal Corp.
May 2012	Representative Director and President of
Hokuriku Wacoal Sewing Corp.
Apr. 2014	Representative Director and President of
Kyusyu Wacoal Manufacturing Corp.
Apr. 2016	General Manager of Innerwear Merchandising
Supervisory Division, Wacoal Brand Operations of
Wacoal Corp.
Apr. 2018	Corporate Officer, General Manager of Wacoal Brand
Innerwear Products Supervisory Division,
Wholesale Division of Wacoal Corp.
Jun. 2021	Audit & Supervisory Board Member of Wacoal Corp.
(present)
Audit & Supervisory Board Member of the Company(present)

External Audit & Supervisory Board Member

External Audit & Supervisory Board Member

Nov. 1977 Joined Pricewaterhouse
Aug. 1982 Registered as Certified Public Accountant
Jul. 1992 Joined Aoyama Audit Corporation
Aug. 2007 Joined Deloitte Touche Tohmatsu
Jun. 2010	Vice Chairman of The Japanese Institute of Certified
Public Accountants Kinki Chapter
Sep. 2011	Left Deloitte Touche Tohmatsu
Oct. 2011	Established Shirai Public Accounting Firm,
Managing Partner (present)
Jun. 2015	Audit & Supervisory Board Member of the Company(present)

Oct. 2000	Admitted to the Bar Joined the Law Office ofTadashi Yamada
Oct. 2004	Joined the Kikkawa Law Office
Apr. 2008	Partner at the Kikkawa Law OfficeJun. 2017	Audit & Supervisory Board Member of the Company(present)
Feb. 2019	Managing Partner of Hamamoto Law Office(present)

Shinichi Kitagawa

Hiroshi Shirai

Katsuhiro Okamoto

Mitsuhiro Hamamoto

External Audit & Supervisory Board Member

Minoru Shimada

Apr. 1977	Joined The Bank of Tokyo, Ltd.
(currently MUFG Bank, Ltd.)
Jun. 2004	Corporate Officer, General Manager of Corporate
Banking Group No.1, Corporate Banking Division No.4,
The Bank of Tokyo Mitsubishi, Ltd.
(currently MUFG Bank, Ltd.)May 2005	Corporate Officer, Manager of New York Branch
Apr. 2008	Managing Corporate Officer, General Manager ofCorporate Banking Group, Nagoya Branch, The Bank ofTokyo-Mitsubishi UFJ, Ltd.
(currently MUFG Bank, Ltd.)
Jun. 2010	Representative Director and Vice President,
SOTSU CORPORATION
Jun. 2011	Representative Director and President,
NAIGAI Construction Co., Ltd.
Jun. 2012	Representative Director and President,
SOTSU CORPORATION
Representative Director and President,
Sotsu Amenity Service Corporation
Jun. 2018	Director and Chairman, SOTSU CORPORATION
Audit & Supervisory Board Member of the Company(present)
Jun. 2020	Full-time Advisor, SOTSU CORPORATION

Major Concurrent Positions
https://www.wacoalholdings.jp/ir/public_item/soukai/files/soukai_
notice2206081_1.pdf

I N T E G R AT E D R E P O R T 2 0 2 2

71

Corporate GovernanceThe basic policy and purpose of the Wacoal Group’s corporate governance is to continuously enhance enterprise value by
increasing transparency and ensuring the fairness and independence of corporate management in order to build mutual
trust in relationships with every stakeholder, including shareholders, customers, employees, business partners, and local
communities.
Corporate Governance Guidelines
https://www.wacoalholdings.jp/en/group/files/governance_guideline202112en.pdf

Corporate Governance Structure
We have chosen an Audit & Supervisory Board system, whichenables the Board of Directors and the Audit & Supervisory Board tosupervise and audit the execution of operations to maintain corporate governance in Group companies as a holding company.

Comprising five Audit & Supervisory Board members, three ofwhom are external members, the Audit & Supervisory Board aims tostrengthen their supervision and auditing of business
management.
Further, the Group has established the Group Management
Meeting, which comprises directors and principal members andconducts discussions that include analysis of Group management
strategies and other important management issues and priordeliberation of matters for consideration by the Board of Directors.

Summary of the Corporate Governance System andthe Reasons for Its Adoption
The Company has adopted a governance system based on a Boardof Directors, comprising directors who are conversant with respective businesses and external directors with diverse professional
backgrounds, and an Audit & Supervisory Board, including external
Audit & Supervisory Board members. This governance systemenables the holding company to effectively supervise and audit theexecution of operations at Group companies and to realize andmaintain high-quality business management.
The Board of Directors comprises seven directors, three of whomare external directors and one of whom is a woman, who carry out
management decision-making and supervision from an objective
perspective. They aim to reinforce supervisory functions andenhance decision-making. To clarify management responsibility,
directors are appointed for one year. Thus, we have built a business
management system that enables rapid responses to changes inbusiness conditions.

Overview of the Corporate Governance Structure (as of June 29, 2022)
FormatAudit & Supervisory Board system

Number of directors

7

Of whom, external directors

3

Term of directors

1 yearNumber of Audit & Supervisory Board members

5

Of whom, external Audit & Supervisory Board
members3

Number of independent officers

6

Participation of external directors in determination of remuneration
Organizations to assist in decision-making

Yes
Executive Nomination Advisory Committee andExecutive Compensation Advisory Committee
Group Management Meeting,Management Issues Review Meeting, andQuarterly Achievements Review Meeting

Key committees
Results-linked remuneration

Yes

Corporate Governance Structure
General Meeting of Shareholders
Election / Removal
Consultation

2 Executive Nomination

Advisory Committee
Chairman: External director
5 directors (of whom 3 are external directors)

Advisory Committee
Chairman: External director
5 directors (of whom 3 are external directors)
4 Independent External Officers Meeting

Reportingof findings

Secretariat Office for Audit &Supervisory Board

Assessment

Accounting Auditors(Business execution)

Audit

Representative Director, President and CEO

Key Committees

8 Corporate Ethics and Risk Management Committee

Audit
OfficeCooperation

Accountingaudit

7 Quarterly
Achievements
Review Meeting*

Give audit instructions to

9 Sustainability Committee

Corporate Ethics
Hotline5 Group Management Meeting*

Subcommittee
for Compliance

Report to

Quality
Assurance
Council

Subcommittee for Subcommittee for
BCP and Disaster
Information
Control Measures
Security

Subcommittee for
Carbon Neutral

Subcommittee for
Subcommittee for
Subcommittee for
Resource
Human Rights,
CSR Procurement
Circulation
D&I

Give audit instructions toReport to

Operating department / Group company* Both internal and external Audit & Supervisory Board members attend meetings for the purpose of auditing the performance of duties by directors

72

Cooperation

5 Audit & Supervisory Board
members(of whom 3 are external Audit &Supervisory Board members)

1 Board of Directors*
7 directors (of whom 3 are external directors)

Election / Removal

6 Management
Issues Review
Meeting

Audit & Supervisory Board

Audit

Reportingof findings

Consultation

3 Executive Compensation

Election /RemovalElection / Removal

I N T E G R AT E D R E P O R T 2 0 2 2Internal
audit

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Overview and Composition of the Board of Directors, Advisory Committees, and Other Meetings
Name

Description

Number of meetings
convened in FY2022

1

Board of Directors

Based on its regulations, the Board of Directors convenes regular meetings every month and convenes extraordinary meetings
as required. It makes decisions on management policy and strategy and other important business-related matters as well as on
matters stipulated by statutory laws and regulations or the Company’s articles of incorporation.

14

2

Executive Nomination
Advisory Committee

An advisory body to the Board of Directors, the committee is chaired by an independent external director and comprises threeexternal directors and two internal directors. In principle, the committee convenes annually on the day of the January meetingof the Board of Directors, considers the nomination or promotion of directors, and submits proposals to the Board of Directors forapproval. The attendance and approval of all committee members are required to pass resolutions.

63

Executive Compensation
Advisory Committee

An advisory body to the Board of Directors, the committee is chaired by an independent external director and comprises threeexternal directors, one internal director, and one executive officer. In principle, the committee convenes on the days of the April,
July, and February meetings of the Board of Directors, considers the compensation of directors, and submits proposals to theBoard of Directors for approval. The attendance and approval of all committee members are required to pass resolutions.

54Independent External
Officers Meeting

Primarily comprising independent officers, this meeting evaluates the Board of Directors by exchanging opinions. Further, thedetails of these evaluations are reported to the Board of Directors and then disclosed through a corporate governance report.

35Group Management Meeting

Comprising directors and key members of the management team, the meeting considers items related to the Group’s management strategy and other important management issues and conducts prior examinations of agenda items to be discussed by the
Board of Directors.

22

6

Management
Issues Review Meeting

This meeting is convened as required to analyze medium- to long-term Companywide strategies and important management
issues and to prepare drafts of management strategies and medium- to long-term plans.

16

7

Quarterly Business Results
Review Committee

Convening three times a year, this committee checks business results and the progress of measures. Also, if targets are notachieved, the committee considers improvement measures and revises targets as required.

38

 orporate Ethics and Risk
CManagement Committee

With the representative director, president and CEO acting as the administrative manager and the director of the Administrative
Department acting as the chairperson, the committee comprises internal directors, the directors of operating companies, andexecutive officers. The committee promotes the establishment of a compliance system, consideration of compliance issues thathave a serious impact on the Wacoal Group, enhancement of awareness and enlightenment on corporate ethics, and theeffective control of any management risks to the Wacoal Group.

7

9

Sustainability Committee

With the representative director, president and CEO acting as the administrative manager and the representative director, vicepresident and executive officer acting as the chairperson, the committee comprises internal directors, the directors of operatingcompanies, and executive officers. For the Group as a whole, the committee discusses strategies related to s­ ustainability
activities and monitors the progress of initiatives.

Established in
April 2022

Diversity of the Board of Directors and the Audit & Supervisory Board
Directors
Expertise and experience beneficial to the Company
Name

Independence
Corporate(external
management
directors only) (Experience andInsight)

Law andcompliance

Finance andaccounting

Sustainability
and diversity
and inclusion

Personnel
development
andorganizational
development

International
insight

Digitaltransformation

MarketingTechnology andproduction
quality control

Digitaltransformation

MarketingTechnology andproduction
quality control

Hironobu Yasuhara
Tomoyasu Ito
Akira Miyagi
Masaaki Yajima
Madoka Mayuzumi
Shigeru Saito
Tsunehiko Iwai
Note: The above overview does not represent the entirety of directors’ expertise and experience.

Audit & Supervisory Board Members
Expertise and experience beneficial to the Company
Name

Independence
Corporate(external
management
directors only) (Experience andInsight)

Law andcompliance

Finance andaccounting

Sustainability
and diversity
and inclusion

Personnel
development
andorganizational
development

International
insight

Shinichi Kitagawa
Katsuhiro Okamoto
Hiroshi Shirai
Mitsuhiro Hamamoto
Minoru Shimada
Note: The above overview does not represent the entirety of Audit & Supervisory Board members’ expertise and experience.

I N T E G R AT E D R E P O R T 2 0 2 273

Corporate Governance

Measures to Strengthen the Effectiveness of Corporate GovernanceAs shareholders have entrusted it to do, the Company’s Board of Directors aims to maximize corporate value by reaching optimal decisions basedon impartial judgment and by supervising the execution of business operations. With a view to further improving these roles through the deliberation of issues and the evaluation of the current status of the Board, the Company evaluates the effectiveness of the Board as a whole every year
and endeavors to continuously improve the Board’s functions and effectiveness. The Board also advances improvement measures to address
issues identified by the evaluation. In the evaluation of the following fiscal year, the current status of the Board and the progress of improvements
made since the previous fiscal year are verified.
Evaluation Process(1) FY2021
Interviews on evaluations of the effectiveness of the Board of Directors were held
at a meeting of independent external directors and external Audit & Supervisory
Board members. After issues had been identified, improvement proposals werediscussed and the findings were reported to the Board of Directors.
(2) FY2022
With the aim of further improving the effectiveness of the Board from the perspectives of enhancing stakeholder trust (creating social value) and improving
organizational performance (increasing enterprise value), the Company changed
to a questionnaire-based method for the analysis and evaluation of the Board’s
performance. This method entailed the utilization of a third-party organization,
which provided assistance with questionnaire preparation, analysis,benchmarking against other companies, identification of issues, and action plans.
All directors and Audit & Supervisory Board members were asked to complete aquestionnaire, and after analyzing the questionnaire responses, improvement
proposals were compiled. Details of the responses and proposals were presented to
the Independent External Officers Meeting and then reported to the Board. The
aggregated results of the questionnaire confirmed that the Company’s Board isgenerally functioning properly and effectively, with an overall average score thatis above the benchmark.
Evaluation Items in the Questionnaire(1) Roles and responsibilities of the Board, (2) Composition of the Board, (3) Qualityof deliberations (agenda items and document contents), and (4) Constructive
dialogue with stakeholders

Improvement
measuresIssuesidentified

Assessments of the Effectiveness of the Board of Directors and Improvement Measures
FY2021

FY2022

1. Further improve the efficiency of the Board of Directors by improving the content of thematerials distributed in advance of Board of Directors’ meetings and accelerating thetiming of their distribution
2. Reconsider the agenda, meeting frequency, participating members, and management
methods of the Executive Nomination Advisory Committee, the Executive Compensation
Advisory Committee, and the Independent External Officers Meeting
3. Increase contact points among executive management, such as executive officers andgeneral managers(1) Enhance and augment the content of agenda items, follow-up reporting on resolved matters, andthe process for analyzing medium- to long-term strategies(2) Establish a common understanding of the roles expected of external directors(3) Clarify the role of the Executive Nomination Advisory Committee and heighten the transparencyof the review process for succession, appointment, and dismissal(4) E nhance input provided to external directors and external Audit & Supervisory Board members
through store tours, increased contact with employees, and training(1) Revised the composition of documents for and the administration of meetings of the Boardof Directors and brought forward the timing of the distribution of the documents before themeetings(2) Convened meetings as needed depending on agenda items and revised agenda items(compensation system, evaluation system, succession plan, and appointment anddismissal criteria); in addition, began revising the method of evaluating the Board of
Directors(3) Increased opportunities for receiving reports from executive officers and generalmanagers and created opportunities for discussion of business strategies(1) B egin revision of meeting administration and the setting of agenda items, including setting
progress reports on important matters as regular agenda items and revising the scope ofdelegation to executive officers of decisions related to business execution(2) E xamine the ideal composition of the Board of Directors in light of the medium- to long-term
strategy; refer to the strategies of the medium-term management plan to categorize the skills
required of external directors and revise the skills matrix(3) R evise the administrative schedule and administrative methods of the Executive Nomination
Advisory Committee and the Executive Compensation Advisory Committee, clarify the roles of
the two committees, and make their administration more transparent(4) Promote an increase in contact with employees through such methods as store tours

External Directors and External Audit & Supervisory Board Members
The Company has three external directors and three external Audit& Supervisory Board members. The Company appoints external
directors who have made wide-ranging contributions to the fields ofart and culture in Japan and overseas or who have extensive experience and knowledge of corporate management. By providing
objective, neutral advice based on their extensive business experience and specialized knowledge in a range of fields, external directors enhance the appropriateness of directors’ decision-making.
Further, the Group appoints as external Audit & Supervisory
Board members certified public accountants who have a high levelof expertise with regard to finance and accounting, attorneys whoare independent from the Company, and individuals who have
many years of experience of working in financial institutions andextensive knowledge of corporate management. While retaining ahigh degree of independence, external Audit & Supervisory Board
members draw on their expertise to undertake strict auditing of thelegality of directors’ decision-making and operational execution.
Criteria to Ensure the Independence of Outside Officers
https://www.wacoalholdings.jp/group/files/governance_outsidedirectors_en.pdf

Reasons for Election of External Directors and External Audit & Supervisory Board Members
Reason for election

Expected field of expertise and knowledge

Attendance at Board of
Directors’ meetings

Madoka Mayuzumi

As a haiku poet, Madoka Mayuzumi has made wide-ranging contributions to the fields ofart and culture in Japan and overseas. Her expertise and experience is expected to­contribute to our efforts to realize business management that emphasizes diversity, making
her an appropriate external director for the Group.

Sustainability, diversity and inclusion,­personnel development, and organizational
development

14/14

Shigeru Saito

It is anticipated that Shigeru Saito will enhance management supervisory functions byproviding input from various perspectives based on his extensive knowledge and­experience as a representative director of another company.

Corporate management, international insight,
and digital transformation

14/14

Tsunehiko Iwai

In addition to his extensive knowledge and experience as a business manager, Tsunehiko
Iwai can also be expected to contribute to management using his specialist knowledge
relating to research, production, and various fields of technology.

Corporate management, law, compliance,sustainability, diversity and inclusion,organizational development, marketing,technology, and production quality control

14/14

External directors

External Audit &Supervisory Board
members

Reason for election

Attendance at Board of Directors’ meetings and Audit & Supervisory Board meetings
Board of Directors’ meetings

Audit & Supervisory Board meetings

Hiroshi Shirai

Specialized knowledge of accounting and finance as a certified public accountant make
Hiroshi Shirai an appropriate external Audit & Supervisory Board member for the Group.

14/14

15/15

Mitsuhiro Hamamoto

Mitsuhiro Hamamoto’s experience and specialized knowledge as an attorney make him anappropriate external Audit & Supervisory Board member.

14/14

15/15

Minoru Shimada

Minoru Shimada can be expected to contribute to our audit and supervisory structure byusing his extensive experience in the financial sector and his knowledge as a business
manager, as well as his overseas experience.

14/14

15/15

74

I N T E G R AT E D R E P O R T 2 0 2 2

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Strengthening of the Functions of the Audit & Supervisory Board and Its Members
The Audit & Supervisory Board comprises two internal full-time
Audit & Supervisory Board members and three external Audit &Supervisory Board members. Convening monthly to coincide withthe meetings of the Board of Directors, the Audit & Supervisory
Board also holds extraordinary meetings as required. Audit &Supervisory Board members make decisions on matters concerning policies on the preparation of audit reports and the implementation of audits, methods of examining the statuses of businessperformance and assets, and other matters related to businessexecution, in accordance with the regulations of the Audit &Supervisory Board. In addition, the Company assigns an independent, dedicated secretariat to the Secretariat Office for the Audit &Supervisory Board to assist in their duties.

At meetings of the Audit & Supervisory Board, external Audit &Supervisory Board members communicate and coordinate
extensively with full-time Audit & Supervisory Board members.
For example, the latter provide the former with reports on thestatus of audits of operations and the details of discussions atimportant meetings. External Audit & Supervisory Board members
also receive various types of reports from the independent auditor
and departments engaged in internal control as well as audit
internal control systems, including the appropriateness of financial
reporting. With a view to heightening the effectiveness of audits,external Audit & Supervisory Board members engage in a range ofother activities. For example, they attend important meetings otherthan those of the Board of Directors in light of discussions of the
Audit & Supervisory Board and visit subsidiaries to conduct audits
and investigative interviews.

Internal Control
The Office of Corporate Auditors reports directly to the representative director, president and CEO and conducts internal audits
pursuant to internal audit regulations. The office audits compliancewith laws and regulations and the appropriateness of the executionof duties at the Company and subsidiaries in Japan and overseas,
evaluates the effectiveness of internal control, and periodicallyreports the results of these activities to the representative director,
president and CEO (Group CEO).

Further, the Office of Corporate Auditors comprises nine personnel and holds monthly report verification meetings with Audit &Supervisory Board members. These meetings primarily verify
reports on the main points of meetings that Audit & Supervisory
Board members attend and report on the activities of the Office ofCorporate Auditors. The Company has established a system forsharing documents and other information required for audits. To
facilitate efficient, effective audits, both parties coordinate throughsuch measures as mutual exchanges and the verification of audit
working papers.

Compensation of Officers
Under the Company’s system for the compensation of officers,
compensation comprises basic compensation, which is fixed;
bonuses linked to the Company’s performance in each fiscal year;
and transfer-restricted stock compensation, which provides
medium- to long-term incentives. Given that they are not involvedin the execution of duties, independent external directors and Audit& Supervisory Board members only receive fixed basic
remuneration.
Further, in July 2022 the Company revised the ratios of stockcompensation to basic compensation so that stock compensationaccounts for a larger percentage of the compensation of officers as
they rise in rank. The breakdown of rank-based percentages reflecting said change will be within the ranges shown below. Further, thisbreakdown assumes calculation methods for performance-based
bonuses that are in accordance with standard values.
Basic compensation
Performance-based bonuses
Transfer-restricted stock compensation

60%–68%18%

14%–22%

Roles and Activities of the Executive Compensation Advisory
Committee
As an advisory body to Board of Directors, the Executive
Compensation Advisory Committee discusses and resolves matters related to directors’ compensation and the directors’ compensation system from an independent, objective perspective. A
majority of the members of the Executive Compensation Advisory
Committee, which is chaired by independent external director
Tsunehiko Iwai, are independent External Directors. To enhancetransparency, external Audit & Supervisory Board members also
attend meetings of the Executive Compensation Advisory
Committee as observers.

December 21, 2021: Partial revision of the system for the compensation of officers(revision of the breakdown of basic compensation, performance-based bonuses, andstock compensation)
January 25, 2022: Partial revision of the system for the compensation of officers (part II)
February 28, 2022: Partial revision of the system for the compensation of officers(part III) and verification of data on the level of compensation of officers and basic
compensation amounts
March 28, 2022: Basic compensation amounts in fiscal 2023
April 27, 2022: Performance-based bonuses of officers

Roles and Agenda Items of the Board of Directors
The Board of Directors deliberates and resolves matters related tothe compensation of officers based on recommendations received
from the Executive Compensation Advisory Committee.
June 29, 2021: Basic compensation amounts for fiscal 2022
June 29, 2021: Issuance of transfer-restricted stock compensation
May 13, 2022: Amounts of performance-based bonuses of officers
May 31, 2022: Basic compensation amounts and determination of the compensationof individual directors for fiscal 2023
June 29, 2022: Issuance of transfer-restricted stock compensation• Basic Compensation
The amount of basic compensation is designed to set a single rate
for each position in principle and is fixed as a monthly payment.
With reference to the results of a compensation survey conductedby an external organization, every year the Company verifies therange of appropriate levels of compensation for companies in thesame industry as well as for companies of a similar size and thensets a level of compensation commensurate with the Company’sbusiness results and size. Further, a resolution of the Ordinary
General Meeting of Shareholders convened on June 29, 2005, set
upper limits of ¥350 million for the aggregate annual basic compensation of all directors (excluding employee salaries of directors
who concurrently serve as employees) and ¥75 million for theaggregate annual basic compensation of all Audit & Supervisory
Board members.
I N T E G R AT E D R E P O R T 2 0 2 275

Corporate Governance• Performance-Based Bonuses
To increase the degree of linkage between bonuses and consolidated
business performance, the aggregate amount of performance-based
bonuses is determined for each fiscal year based on the percentage
achievement of a reference value of consolidated operating profit
and, to a lesser extent, based on certain other business results(consolidated net sales, consolidated income before taxes, etc.). The
payment will be made once in the month in question after the total
amount has been approved at the Ordinary General Meeting of
Shareholders for the relevant fiscal year.

to share the risk of share price fluctuations with shareholders andto motivate eligible directors to contribute more than ever toincreasing the share price of the Company and enhancing its
enterprise value. To promote shared priorities with shareholders
over long periods, eligible directors who are allotted transferrestricted stock may not cancel the restriction on transfer of theallotted shares during the period from the date of delivery of thetransfer-restricted stock until the date of retirement from theposition of director, Audit & Supervisory Board member, or executive officer of the Company or any of its subsidiaries as determinedby the Board of Directors of the Company.
Further, an upper limit on annual transfer-restricted stock compensation of ¥70.0 million has been established pursuant with aresolution of the 73rd Ordinary General Meeting of Shareholders,convened on June 29, 2021.

• Transfer-Restricted Stock Compensation
The Company has introduced a compensation plan under whichtransfer-restricted stock is allotted to directors (hereinafter referred
to as “eligible directors”) with the aim of enabling eligible directors
Compensation of Officers in FY2022

Total amount of
remuneration, etc.
(¥ million)

Classification

Total amount of remuneration, etc., by type (¥ million)
Basic compensation

Performance-based
bonuses

Share-based stock
options

Number of eligible
recipients

Directors (excluding external directors)

277

232

―

44

5

Audit & Supervisory Board members (excluding external members)

39

39

―

―

3

External directors and external Audit & Supervisory Board members

50

50

―

―

6

Reviewing the System for the Compensation of Officers with a View to Strengthening Its Effectiveness
The Executive Compensation Advisory Committee is engaged in an ongoing review of the entire system for the compensation of officers. Goingforward, the committee will consider the following matters:
The mix of basic compensation, performance-based bonuses, and medium- to long-term incentives (review of monetary amounts and percentages)
The calculation method for performance-based bonuses (strengthening linkage with the numerical targets of the medium-term management plan)

Policy on Strategic Shareholdings and Standards for Exercising Voting Rights
The purpose of the Company’s strategic shareholdings is toenhance enterprise value over the medium to long term by maintaining and strengthening transactional relationships; establishing, maintaining, and strengthening cooperative andtransactional relationships with respect to business development;
and maintaining stable financial transactions. The Company
determines whether strategic shareholdings are appropriate froma medium- to long-term perspective and whether the attendant
benefits and risks of strategic shareholdings commensurate withequity cost are verified, and the findings are periodically reported
to the Board of Directors. Based on the verification findings, theBoard of Directors analyzes whether strategic shareholdings
contribute to the enhancement of the Company’s enterprise value
over the medium to long term and decides whether to continue or
dispose of strategic shareholdings.
Further, during the period of the previous medium-term management plan (April 2019–March 2022), the Group decided to reduce
strategic shareholdings by 30.0% (at least ¥20.0 billion). The Boardof Directors examined whether income realized from each stock
holding exceeded the Company’s capital cost and whether suchstrategic shareholdings contributed to the enhancement of enterprise value. Based on results of this examination, during said period
the Company disposed of and reduced strategic shareholdings inaccordance with plans, disposing of a total of 37 stocks, with avalue of ¥19.7 billion, for which the significance of ownership had
diminished.
Reference: Shareholdings of Wacoal Corp.
FY2020

FY2021

84

73

63

Monetary amount (¥ billion)

42.2

50.1

46.0

As a percentage ofconsolidated total assets

15.2%

15.5%

15.2%

Number of stocks

FY2022

Note: The shareholdings of Wacoal Corp. for which the largest monetary amount isrecognized on the balance sheets in relation to investment in equity securities(the monetary amount of equity securities recognized) have been stated.

Compliance and Risk Management Structure
The Company’s Corporate Ethics and Risk Management Committee
has the representative director, president and CEO acting as theadministrative manager, supervisor, and , and the director, vicepresident and managing corporate officer in change of Groupbusiness management as its chairperson. The committee is tasked
with developing the compliance structure, examining complianceissues that could significantly affect the Wacoal Group, ensuring all
employees understand and internalize corporate ethics, and effectively promoting control of any management risks to the Wacoal
Group.
76

I N T E G R AT E D R E P O R T 2 0 2 2Compliance Structure
The Company has established the Wacoal Code of Ethics and the
Corporate Ethics: Wacoal’s Code of Conduct to ensure that directors
and employees perform their duties in compliance with laws,
regulations, and the articles of incorporation and sound social
norms. Further, the Wacoal Code of Ethics and the Corporate Ethics:
Wacoal’s Code of Conduct stipulates resolute refusal of demands
from antisocial forces. In addition, the Company has established aninternal whistleblowing system and other systems that enabledirectors and employees to report on any misconduct or inappropriate behavior.

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Risk Management Structure
Subject to the approval of the Board of Directors, the Corporate
Ethics and Risk Management Committee stipulates basic regulations for risk management. Pursuant to these regulations, thecommittee clarifies the responsibilities for each category of risk
and advances the construction of a risk management system thatcomprehensively encompasses the Wacoal Group’s overall risks.
Further, given the diversification of risks related to information
security and their increasing impact on business operations, a new
Subcommittee for Information Security has been established.

Risk Management Structure

Information Security Subcommittee (Newly Established)
To reduce information security risks in the Group’s business activities, the Subcommittee for Information Security collects information, investigates current situations, and conducts analysis inrelation to information security as a whole, including cyberattacks
that target customers’ personal information and critical technicalinformation. Also, the subcommittee deliberates on the formulationof the Group’s action policies and specific countermeasures, theestablishment and abolition of related regulations, and the implementation of strategic investments and monitors progress. The
deliberated policies and activity details are regularly reported to theBoard of Directors through the Corporate Ethics and Risk
Management Committee.

Representative Director,
President and CEO

Corporate Ethics andRisk Management Committee

Subcommittee for Compliance

Quality Assurance Council

Discusses and makes decisions on thecompliance management structure andother significant matters

Promotes quality assurance activities
based on quality assurance regulations

Promotes the consideration of compliance issues that have aserious impact on the Wacoal Group, enhancement of awarenessand enlightenment on corporate ethics, and the effective control
of any management risks to the Wacoal Group.

Subcommittee for BCP and
Disaster Control Measures

Subcommittee forInformation Security

Takes measures to prevent and respondto accidents, disasters, and otheremergencies

Advances activities aimed at reducing
information security risks, such as
information leaks

Risk Management during the COVID-19 Pandemic
Based on our determination to give first priority to the safety of customers, business partners, and Wacoal Group employees and to theprevention of the further spread of COVID-19, we have established the COVID-19 Task Force, which reports to the Corporate Ethics andRisk Management Committee and is chaired by the director and executive corporate officer. Further, we are implementing countermeasures while carefully monitoring the status of the pandemic in Japan and overseas. Specifically, we are determining the methods ofwork and service provision of in-store sales personnel as well as stores’ sales formats according to the status of the pandemic. In
addition, in response to national and regional conditions we are flexibly implementing measures for the workstyles of office personnel,
including the promotion of online meetings and telecommuting and restrictions on business trips and in-person meetings.

Basic Policy on Information Disclosure
We see timely disclosure of accurate information as the foundationof mutual trust in relationships with all stakeholders. We are also
keenly aware that disclosure is essential for accurate assessmentsof our enterprise value. We actively disclose information while
complying with all related regulatory requirements.
We have identified three basic requirements for information
disclosure. First, important information must be disclosed accurately and in a timely manner, regardless of whether it is positive or

negative. Second, information must be expressed in language thatis easy for all stakeholders to understand and disclosed using
various methods to ensure ease of access and fairness. Third,organizational, personal, physical, and technical steps must be
taken to prevent information leakage before timely, appropriate
disclosure.
Basic Policy on Information Disclosure
https://www.wacoalholdings.jp/en/ir/management/discloser/

Basic Policy on Constructive Dialogue with Shareholders and Other Stakeholders
We have adopted and published a basic policy on constructive
dialogue with shareholders and other stakeholders. Dialogue withshareholders and other stakeholders is under the overall control ofthe director, vice president and managing corporate officer incharge of group business management and is the responsibility ofthe division in charge of investor relations as well as the Group
officers and employees that said division designates. Various
factors are considered in relation to requests for meetings withdirectors, including the proposed subject matter of the meeting andthe affiliations of the person seeking the meeting. In addition to fair,timely, and accurate disclosure about our business management
and financial situation to shareholders and other investors inJapan and overseas, we help them gain a better understanding ofour viewpoint and approach by actively distributing information
about the market environment and our unique strengths.
Policy for dialogue with Shareholders / Investor
https://www.wacoalholdings.jp/en/sustainability/talk_with_stockholder/I N T E G R AT E D R E P O R T 2 0 2 277

Establishing Mutual Trust through Dialogues
The Wacoal Group believes that engaging in constructive dialogues toward the enhancement of enterprise value is critical to deepening relationships of mutual trust with all of its stakeholders. However, our price book-value ratio (PBR) has remained below 1.0
times for a number of years, reflecting the fact that we have not been able to meet the expectations of the market. In part, this isbecause we have not been able to arrange sufficient opportunities for stakeholder engagement in our management activities.
In light of this fact, we have taken a proactive approach to our engagement with all stakeholders, including shareholders andinvestors, by gaining their valuable input through results briefings and investor relations interviews and reflecting them in ourmanagement strategies with the aim of achieving medium- to long-term increases in corporate value and establishing a highly
effective management structure.
The Wacoal Group’s Price Book-Value Ratio (PBR)
Price book-value ratio (PBR) (Times)
1.5

1.0

0.5

0
98/3

99/3

00/3

01/3

02/3

03/3

04/3

05/3

06/3

07/3

08/3

09/3

10/3

11/3

12/3

13/3

14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3

22/3

FY

Stakeholder Relations
At the Wacoal Group, we define corporate value as the integration of all value gained by customers, employees, shareholders, investors, andother stakeholders. Through our communication with all stakeholders, we strive to maintain solid relationships and build deep mutual trust.
Moreover, the details of our investor relations and ESG (environmental, social, and governance) activities are communicated through theefforts of the Corporate Communications Department.

Communication Activities for Analysts and Institutional Investors (Results)
Activity

Individual meetings with institutional investors and analysts

FY2020/3

FY2021/3

FY2022/3

98 times

126 times

131 times

Results briefings (for analysts and institutional investors)

Twice

4 times

4 times

Business briefings (for analysts and institutional investors)Once

3 times

3 times

Factory tours (for analysts and institutional investors)

Twice

―

―

Conferences organized by securities companies

Once

Once

Twice

Overseas road shows

Twice

―

―

Briefings for individual investors

3 times

Once

Once

―

4 times―

Individual meetings with external directors (for analysts and­institutional investors)
Activity

Feedback on IR activities (for directors)
Briefings (for employees)

FY2020/3

FY2021/3

FY2022/3

Twice a year

Quarterly

Quarterly

Held briefings on­integrated report for
general employees

Held briefings oni­ ntegrated report for
management personnel

Holding of sustainability
seminars for employees(320 participants)

Message from the Corporate Communications Department

The mission of the Corporate Communications Department is to contribute to the enhancement of enterprise value and the continuation and growth of the Wacoal Group by establishing and improving engagement with stakeholders. Under VISION 2030, the Group has launched initiatives for renewed growth. The
Corporate Communications Department will continue to play a pivotal role in enhancing enterprise value by
incorporating the valuable input of all of our stakeholders into our management strategies. At the same time,
we will work to deepen their understanding of the Group’s management activities through proactive
dialogue and the appropriate disclosure of information to increase their awareness of the ways in which theGroup contributes to society by evolving its accumulated strengths and maximizing the value provided.

78

I N T E G R AT E D R E P O R T 2 0 2 2

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Follow-Up Meeting (Small Meeting) on VISION 2030 and the New Medium-Term Management Plan
Date:

June 15, 2022

Location:Tokyo

Attendees: ironobu Yasuhara, Representative Director, President and CEO;H
Tomoyasu Ito, Representative Director, Vice President and Executive Officer;
Akira Miyagi, Director, Vice President and Executive Officer; andMasaaki Yajima, Director and Executive Corporate Officer

Participants: 12 participants from 11 companies

Investors’ Views on Vision 2030 and the New Medium-Term Management Plan
On the Vision and Plan Overall e hope to see the swift adoption of effective measures to realize
W
VISION 2030 and the new medium-term management plan.
While relieved that awareness of the need for reform is keenly
felt among the senior management team, including the president, we are not yet able to determine whether the new plan will
be more effective or not in light of Wacoal’s record on previous
plans.
The unprecedented resolve indicated in the briefing session
material, such as the change to the framework of Wacoal’s
management philosophy for the first time since its founding,has given us hope that it may finally be ready to truly change.
The fundamental challenge facing Wacoal lies in its culture ofhesitating to change the status quo. I hope the Company willclearly set forth the type of approach it will take to transforming
itself, including management personnel and regular employees,
and changing its culture. I would also like to verify the extent towhich the need for change is recognized among employees andthe degree of their commitment to change.
On the Domestic Business e feel that there is still a lack of clarity on the time frame andW
concrete measures for the rebuilding of channels for sales
growth.
We would like to see the brand strategy defined more clearly.
In particular, we believe that it would be better to recreate the
Wacoal brand as a high-end brand by redefining it and unifying
it on a global basis.
The fact that we are not seeing satisfactory results despite
Wacoal ’s brand power and product appeal is a source offrustration. We thought that it would have been positive to havean in-depth discussion on where the qualitative value of thephysique measurement data held by Wacoal—which muststrengthen its marketing—lies, how that differs from othercompanies, the state of the platform for leveraging such data,
and matters that need to be addressed going forward.
We would like to know how digital transformation initiatives,
including 3D smart & try , will contribute to top-line growth.
Although we understood the projections for customer data in thecustomer experience strategy, we want to know how Wacoal
will achieve this strategy and hope the Company will provide athorough explanation going forward.
On the Overseas Business e have the impression that it will be some time before theWcauses of the lag in the growth of Intimates Online, Inc.—such as
the deterioration of its marketing investment efficiency resulting from digital privacy regulations—are resolved. We hope that
Wacoal will provide ongoing explanations on the measures itwill adopt to address such causes going forward.
Others acoal’s policy on strategically held shares and initiatives onWshareholder returns have given us a sense of its commitment toreform.
The active involvement of younger employees has recently
become a distinguishing feature of companies with favorable
business performances. If such employees are increasing in
number at Wacoal, we would like to hear about it.

Wacoal Receives the IR Special Award and the Most Liked! IR Award at the 2021 IR Awards
In recent years, Wacoal has improved its investor relations activities and increased
opportunities for dialogue. Senior management have been at the forefront of such
efforts, garnering high praise for striving to share information on issues withinvestors, even amid a challenging operating environment. Wacoal has begun to
Reasons for
Selection

actively conduct a variety of investor relations activities, including small meetings
with the presidents of its operating companies and interviews with external
directors. Wacoal has also attracted attention for its Companywide efforts onsustainability, such as the holding of briefings for employees on its integrated report.

I N T E G R AT E D R E P O R T 2 0 2 279

Investor Information(As of March 31, 2022)

Stock Listing

Tokyo Stock Exchange

Shareholder

Mitsubishi UFJ Trust and Banking Corporation,

Fiscal Year-end

March 31

Register Agent for

1-4-5, Marunouchi, Chiyoda-ku, Tokyo

Securities Code3591

Common Stock	100-8212, Japan

Fiscal Year

From April 1 to March 31

American Depositary Receipts

Number of Shares Issued 65,589,042 (Treasury Stock: 4,130,773)

Cusip No.: 930004304

Trading Unit

Ratio (ADR:ORD): 1:5

100 shares

Market: OTCQX
Symbol: WACLY
Depositary	The Bank of New York Mellon, 240 GreenwichSt., New York, NY 10286, U.S.A.
Tel: 1-201-680-6825
U.S. toll free: 888-269-2377 (888-BNY-ADRS)
https://www.adrbnymellon.com/
Number of
Shareholders

Ownership and Distribution of Shares

Major Shareholders

Securities firms

Name

1.28%

Individuals and others

24.86%
Financial
institutions

46.07%
15.45%
12.34%

Other Japanesecompanies

Foreign institutions
and individuals

80

I N T E G R AT E D R E P O R T 2 0 2 220,109Number ofshares held(Thousandshares)Percentage ofshares outstanding (%)

The Master Trust Bank of Japan, Ltd.
(Trust Account)

8,062

13.12

Custody Bank of Japan, Ltd. (Trust Account)

4,943

8.04

MUFG Bank, Ltd.

3,095

5.04

Meiji Yasuda Life Insurance Company

3,050

4.96

The Bank of Kyoto, Ltd.

2,352

3.83

The Shiga Bank, Ltd.

1,751

2.85

Nippon Life Insurance Company

1,569

2.55

Mitsubishi UFJ Trust and Banking Corporation

1,525

2.48

Asahi Kasei Corporation

1,241

2.02

Custody Bank of Japan, Ltd.
(Re-trust of Sumitomo Mitsui Trust Bank,
Limited; Trust Account for the retirement
allowance for Toray Industries, Inc.)

1,205

1.96

MEETING EXPECTATIONS and FULFILLING COMMITMENTS

Our Corporate Website

Wacoal Holdings Corp.’s Website

Sustainability

Investor Relations

https://www.wacoalholdings.jp/enhttps://www.wacoalholdings.jp/en/sustainability/

https://www.wacoalholdings.jp/en/ir/

VisionSustainability Policy

Investor Relations

Message

The WACOAL Way

The WACOAL Way

A Message from the President

Financial Information /“VISION 2030”

Basic Sustainability Policy

Financial Highlights

Corporate GovernanceSystem for Promoting Sustainability

Monthly Sales Data

ComplianceMaterial Issues

IR LibraryIntegrated ReportDividend and Share RepurchaseESG DATA BOOK

Shareholder Benefits

Wacoal’s BusinessWacoal’s Strengths
Value Creation ProcessMaterial Issues
Business Field
Company Profile
Wacoal Holdings Corp.
Wacoal Corp.
Wacoal GroupTurning PointManagement Information

Stock Information

Focus Areas of Our Initiatives(ESG Issues)
CSR Procurement

Stock Price Information
IR News

Corporate GovernanceComplianceRisk Management
Quality and Safety
Human Resources Management

IR News
IR Schedule
Disclaimer
FAQs

Based on Diversity and Inclusion
Environmental
Social Contribution
Human Rights
Engagement with Stakeholders
ISO26000 Comparison Table

For financial information and financial highlights, please visit the Company’s website below.
https://www.wacoalholdings.jp/en/ir/finance/

I N T E G R AT E D R E P O R T 2 0 2 281

I N T E G RAT E D
R E PO R T

2022

Wacoal Holdings Corp.
29 Nakajima-cho, Kisshoin, Minami-ku, Kyoto 601-8530, Japan
https://www.wacoalholdings.jp/en/