• Approach to Human Capital
• Personnel Management Based on the “Principle of Human Resource Capabilities”
• Governance
• Risk Perception
• Strategy
• Internal Environment Improvements
• Securing and Retaining Human esources
• Promotion of Physical and Mental Health
• Employee Engagement
• Reinforcement of Personnel Systems
• Metrics and targets
• Creation of the status of “dedicated employee”

Approach to Human Capital

Our company is committed to evolve into a “Value Co-creation Retailer Group” that continuously provides three co-creation values (Co-creation of Excitement, Co-prosperity with Communities, and Co-existence with the Environment) centered on our retail business, with the goal of achieving this vision by 2030. The power to pioneer the future and realize our vision lies in every single employee of the Group. We consider our employees as our most important value co-creation partner and strive to support each individual's Will (will, desire, and intrinsic motivation) while fostering mutual support and contribution between the company and its employees, thereby achieving growth together.

<Concept of Value Co-creation by the Company and Employees>

(1) Overview of Human Resources Strategy

In our current medium-term business plan, which we have positioned as a period of transformation, we will actively invest in human resources to shift to a new growth pattern and lay the foundation for future growth. Specifically, we will move away from the successful experience of profit growth achieved through company-wide rationalization measures in the past and focus on leveraging the comprehensive strengths of the JFR Group, which operates diverse businesses. To achieve this, we will shift our human resources strategy from “human resources management” to “human resources development,” from “operation-oriented” to “market-oriented,” and from “company-specific optimization” to “group-wide optimization.”
To become a “Value Co-creation Retailer,” we will establish a “HR Management Policy” as the basic approach for human resources across the group, and shift to a human resource portfolio that aligns with management strategy. Furthermore, we will implement effective measures in each human resources area and aim to improve employee engagement and productivity per employee as outcomes of our human resources strategy.

(2) Human resources management policy

To foster the necessary changes in employee behavior and mindset for value co-creation, the Company has established a group-wide human resource management policy called “Power to Involve Others, Mindset to Enjoy Challenges.” This policy will guide our efforts in recruitment, development, placement, and evaluation of human resources who “demonstrate self-motivation,” “transcend and link organizations,” and “enjoy their work.”

Personnel Management Based on the “Principle of Human Resource Capabilities”

Since fiscal 2019, the Company has been implementing a human resources system based on our unique principle of “human resource capabilities,” which aims to visualize the invisible human capital (human capital value, personality, values, temperament, and interests) inherent in our employees. While continuing this human capital-based human resources management, we will foster value co-creation across the entire company by evaluating and surveying the performance of knowledge and skills observable through business operations, as well as behaviors and mindsets.
“Human resource value” comprises the perspective of reproductivity and versatility that leads to steady results and contributions under any circumstances (will, motivation, learning ability, innovation and creativity, influence, negotiation ability, and nurturing ability), and we have set the required level of reach stage.

Governance

Specific policies on sustainability initiatives, including responses to environmental and social issues, are discussed and approved by the Group Management Meeting, the highest decision-making body for business execution. Matters approved by the Group Management Meetings are shared with all operating companies via the Sustainability Committee, an advisory body to the President and Representative Executive Officer. In addition, the Sustainability Committee monitors the implementation plans and progress of each operating company to enhance the effectiveness of Group-wide initiatives.

Link：Creation of Sustainability Committee and Internal Dissemination Measures

Risk Perception

Going forward, if competition for human resources intensifies due to a shortage of workers caused by the shrinking of the working population and the increased mobility of talent, resulting in an increase in the brain drain or difficulty in acquiring talented people, it may not only affect our business performance but also our evolution into the “Value Co-Creation Retailer Group” that we aim to become in 2030. Our human resource strategy will develop change leaders, support voluntary learning by employees, and promote diversity, equity and inclusion to establish an environment where employees can experience growth and job satisfaction. We will also create a comfortable work environment while standing behind all employees so that everyone can work with vigor in good physical and mental health.

Link：Risk Management

Strategy

To enhance the overall capabilities of the Group, the Company will maximize the potential of every employee and leverage their strengths, in accordance with our human resource management policy. Concurrently, we will transform our human resources portfolio by strengthening and reallocating human resources in alignment with our management strategy. Our goal is to become a “Value Co-creation Retailer.”

(1) Strengthening our capabilities to co-create value

In the current uncertain business environment, we believe that the entire company must enhance its “value co-creation capabilities” to achieve significant growth and progress.
We define “value co-creation capabilities” as the ability to not only deliver results based on skills and knowledge — our primary evaluation criterion thus far — but also to collaborate with diverse stakeholders to co-create new value through the necessary actions and mindset. We will further develop specific ability requirements, competencies, evaluation methods, and other related frameworks in alignment with our human resource management policy called “Power to Involve Others, Mindset to Enjoy Challenges.”
For example, we will expand initiatives such as external training-type secondments through CVC funds, digital core human resource development, and the corporate culture development project “RED.” By promoting the creation of value co-creation cases during this period of transition, we will establish a foundation for future growth.

Investment in human resources

We will streamline our efforts to raise the standard across the board and focus our investment on selective and open recruitment-type curricula. In particular, we will focus on (1) early development and selection of young people, (2) revitalization through reskilling of middle-aged and senior employees approaching their second career, and (3) development of management resources.

Link：Support to Help Employees Develop Their Careers

Measures that encourage employees to take on challenges and put their Will into practice – RED –

The Group provides a place for employees to say, “I want to do this!” and the management and employees of the Group work together to support them in realizing their passionate ideas. The name “RED,” meaning “Realize Energetic Dream,” expresses a place where energetic people can make their passions come true. Since its launch in 2023, employees have taken up the challenge of using this system to realize their own dreams.

(2) Management transformation

We will change mindsets and enhance evaluation and feedback skills while continuing traditional hierarchical training. We will also verify the necessary scope of management for effective leadership and implement necessary corrections.

(3) Group personnel exchanges

Leveraging the unique characteristics of our diverse group companies, which includes department stores, shopping centers, developer business, and payment and finance services, we actively promote personnel exchanges, including group-wide recruitment. Going forward, we will implement systems and guidelines to promote personnel exchanges among group companies with diverse business models and corporate cultures. Our goal is integrating human networks and expertise to maximize group optimization and synergies.

Internal Environment Improvements

Diversity, Equity, and Inclusion

We believe that incorporating a diverse range of individuality and converting that diversity into organizational strengths will lead to the realization of sustainable growth. To this end, we will eliminate unconscious bias stemming from age, gender, work styles, and other factors and promote and assign roles in line with the strengths and spirations of employees, from the selection and appointment of young people to the revitalization of middle-aged and senior employees. In other words, we will establish and environment where all employees can make the most of their individual characteristics and play an active role.

Link：Promoting Women's Empowerment

　　　Employment of disabled people

　　　Promotion of the Elderly Empowerment

　　　Actions on LGBT Issues

Securing human resources

Securing and expanding the human resources capable of creating the three co-creation values is essential for our evolution into a “Value Co-creation Retailer Group.” Toward this end, we are striving to strengthen the personnel system and expand paths to employment at the Company, such as through alumni and referrals, to enhance its recruiting capabilities.
Specifically, in addition to new graduates and young people, we have expanded our hiring targets to proactively acquire people with advanced expertise in real estate, banking and finance, and other areas. In the retail business, we will focus on hiring people who can create new content and services by grasping customer needs, and digital human talent who can lead our digital transformation.
In parallel, we are also working on wage policies and work environment improvements to support the retention of human resources.

Number of new graduate hires (Consolidated)

*New graduates enter the company in April each year

Turnover rate (Consolidated)

*Number of retired employees during the year / Number of employees at the beginning of the year (The number of retired employees above excludes employees who retired because of retirement age, transfer or becoming officers.)

Promotion of Physical and Mental Health

Physical and mental health are prerequisites for employees to remain energetic and take on challenges. We support the creativity and productivity of employees by conducting periodic surveys, sharing the results with management, departments, and employees, and carefully implementing the PDCA cycle of planning and executing actions that lead to improvement.

Link：Promoting Health and Productivity Management

Employee Engagement

We conduct surveys to understand employees' motivation toward their work and their engagement with the company. Since FY2023, we have conducted a group-wide standardized survey. The results of the survey are used to create a company in which every employee can demonstrate their abilities and play an active role.

Reinforcement of Personnel Systems

We will improve the expertise of the department and operational efficiency to help them respond quickly and appropriately to hiring, placement, training, evaluation and other real-world tasks. We are also striving to create a system that can contribute as a business partner to management and business unit managers.

Metrics and targets

• *1 Ratio of women in management positions and gender wage gap calculated based on the provisions of the Act on the Promotion of Women’s Active Engagement in Professional Life (Act No. 64 of 2015).
• *2 Group totals, unless otherwise indicated.
• *3 Gender wage gap shows the wages of female employees as a percentage of the wages of male employees.
• *4 Metrics and targets as of May 2024; subject to addition or revision to align with future human resource strategy.

Creation of the status of “dedicated employee”

In order to further empower fixed-term contract employees of Daimaru Matsuzakaya Department Stores and Daimaru Matsuzakaya Sales Associates and secure more stable employment status, we created the status of “dedicated employee” by not only making the employment period indefinite but also improving part of the working conditions.

Specifically, they are entitled to leave allowance*1 and absence deduction*2 like regular employees. When the system was introduced in June 2017, out of a total of approximately 1,800 fixed-term contract employees, approximately 1,600 employees who had met the requirements changed to be employed for an indefinite period at once.

*1 80% of daily amount is paid for the period of sick leave.

*2 60% of daily amount is paid for the period of absence including maternity leave.

Empowering diverse human resources to shine

• Human resources Strategy

• Promoting Women's Empowerment

• Employment of Disabled People

• Promotion of the Elderly Empowerment

• Actions on LGBT Issues

• Human Rights and Labor-Management Relations

• Initiatives to Realize Work-Life Integration

• Promoting Health and Productivity Management

• Support to Help Employees Develop Their Careers

• Social Data

• Acquisition of Third-Party Assurance