Message from the President

Over the past five years, our Group has been accelerating its profitable growth, and reached all of the management indicator targets for sales, operating income, ITS sales, and ROE set in our Long-Term Management Objectives (2021-2025) (the "21-25 Long-Term Objectives"). We have raised our ROE to 10.4%, increased both sales and income for five consecutive fiscal years, and set a new record high for profits.
I believe that we accomplished this by positioning the generation and allocation of cash at the center of our management and, over the course of five years, consistently and steadily implementing measures to grow our business and improve our capital efficiency.
Following my appointment as President in March 2021, we announced the 21-25 Long-Term Objectives in April of the same year. I adopted a basic policy of increasing our ability to steadily generate cash through our business activities and balancing the allocation of this cash between growth investment and shareholder returns.
Under this policy, we continuously invested in businesses, human resources, and systems, aiming for approximately ¥200.0 billion in growth investment over the course of five years. We designated our IT solutions business as a growth area and expanded our business foundations and the value we provide through M&As and funding while also polishing our technical capabilities. As a result of these efforts, we were able to grow our IT solutions business significantly, to over 50% of our total net sales. We reached our 21-25 Long-Term Objectives sales target of ¥300.0 billion a year ahead of schedule, and ultimately reached ¥343.4 billion in sales. Of these, we surpassed our goals for expanding the highly profitable maintenance and operations services/outsourcing business, one of our core businesses, and the quality of this business has also improved. For the Canon products business, while market growth is limited, we have worked to improve profitability by continuing to propose solutions which accurately address customer needs and offer high added value.
We have also steadily increased our shareholder returns. We acquired a total of ¥96.7 billion of treasury stock through four buybacks. We raised our dividend payout ratio from 30% or higher to 40% or higher, issuing a total of ¥71.8 billion in total dividends, a 2.8- fold increase on a per-share basis compared to 2020. Our shareholder return policy has been one of continuing to invest in growth while providing appropriate returns to shareholders. This has helped bring greater order to our capital allocation and further focus attention on management investment decisions and profitability. As a result, we were able to eliminate all short-term loans receivable to the parent company, which had amounted to ¥180.0 billion five years ago.
Due in part to our strong business results and our IR activities, which I was also actively involved in, we more than doubled the number of meetings with analysts and investors compared to five years ago. The contents of these dialogues were relayed to directors including outside directors and business officers and reflected in sales activities.
As a result, we reached all of the management indicator targets set in the 21-25 Long-Term Objectives, and the stock price has also hit a new record high, remaining at a high level.

Our Group's strengths lie in our people, our technologies, and our customer base, and we have further polished these strengths. We have gained a deeper understanding of our customers and continued to provide optimized solutions with even higher added value to address the challenges and needs of individual customers. We have also acquired new technologies and expanded our customer base through M&As and investments. In the development of skilled personnel, we have focused on specialized training that not only helps us meet increasingly diverse customer needs, but also speedily and flexibly adapt and respond to new technological advances to provide even greater added value. Improving the skills of each of our employees has steadily raised their productivity. I feel that this has also produced the virtuous "engagement improvement cycle" that our Group has focused on, in which our personnel development has increased the amount of value we provide to customers and generated greater customer satisfaction, which is then used to give back to employees.
As we have steadily done what needs to be done, it has become increasingly clear where we need to further accelerate and focus our efforts. First, we need to speed up our generative AI efforts to grow the IT solutions business. We are already using it to improve the efficiency of our internal operations and our development work, along with deploying it in our services. However, we must make full use of this technological innovation, which is being adopted throughout society at an accelerating pace, to further propel our business. Furthermore, it is becoming increasingly important that we collaborate with various stakeholders to make use of various new technologies not limited to generative AI, as well as other companies' know-how which we would not be able to acquire on our own.
Second, we need to accelerate the expansion of our service-type businesses. As I mentioned earlier, our IT solutions business has grown to be our Group's core business, but the highly profitable Canon products business has little prospect for large-scale market growth, so we need to speed up the growth of our service-type business and achieve profitable growth. For that purpose, as well, I consider the strengthening of our human capital to remain a top priority. I believe that to develop and hire highly skilled personnel, we must expand our systems that promote improvements to employee baseline skills and reskilling. We must also acquire professionals from outside the Group who can immediately contribute to our business.

This year is the first year of our "Long-Term Management Objectives (2026-2030)" (the "26-30 Long-Term Objectives"). From 2016 to 2020, we engaged in business selection and concentration, switching to an organization structure based on the market and customers. Through this, we transformed to a robust corporate structure. From 2021 to 2025, we shifted our focus to growth investments and improved our capital efficiency while accelerating our profitable growth. Now, over the five-year span from 2026 to 2030, we will work toward further leaps forward.
Our 2030 Vision is "to be a corporate group dedicated to creating new businesses that drive future growth through the power of people and technologies." By "people," we are referring to all stakeholders, including Group employees, customers, and partners. By "technologies," we are envisioning technologies and the knowledge that pertains to them, not only ICT technical skills and our patented technologies, but also industry and operational knowledge, expertise, and insights.
The basic policies behind the 26-30 Long-Term Objectives are as follows:(1) Corporate value sustainably increased by solving social issues through business, (2) Become a highly profitable corporate group centered on the growth of service-type businesses, (3) Create a virtuous cycle through the strengthening of management capital.
Our 2030 Management Indicators are net sales of ¥850.0 billion, operating income of ¥75.0 billion, and an ROE of 12.0%. Furthermore, within those sales, we will raise our IT solutions business sales to ¥500.0 billion and, of those, we will raise our "service/outsourcing^*1" sales to ¥200.0 billion. With regard to growth investments, we plan to invest ¥200.0 billion over the course of five years. We also plan to issue ¥100.0 billion in dividends to return profits to shareholders.

Our approach to our business portfolio as we work toward these goals will remain unchanged: we will further promote profitable growth in our IT solutions business, enhance the profitability of our Canon products business, and expand specialist fields and new businesses. With respect to the IT solutions business, we will balance growth and profitability improvements, while at the same time carrying out M&As, expanding this core business. There is only limited room for overall market growth for the Canon products business, but we will maintain our strong position, commanding the top market share for products such as cameras and laser printers. We will also expand sales in areas where there is still room for growth, such as in MFPs, where we have the third largest market share. Through this, we will pursue greater profit margins without reducing sales. In specialist fields, we will strive for steady upward growth, focusing on industrial equipment, especially the semiconductor-related business. The keys to these fields are technical capabilities and discernment for exceptional overseas technologies and products to be offered domestically. These tie directly into our competitive advantage. Our customers have evaluated us highly for our discernment, and we plan to continue to place great emphasis on passing on the know-how and skills that underpin that discernment through our training, including on-the-job training.
In new business creation, as I mentioned earlier, we will continue our initiatives in two primary directions. In 2024, we created a specialist organization for creating new businesses, so that we could advance into fields where our Group has little prior experience. At the same time, we established an approximately ¥10.0 billion corporate venture capital (CVC) fund. We have already invested in 14 companies through this CVC fund, starting PoCs^*2 for multiple projects. We hope to quickly take them to the PoB^*3 level and, by 2030, to grow them into businesses with a certain scale of sales.
Led by the expansion of our IT solutions business, we will engage in "business investment," such as investing in the creation of service-type businesses, conducting M&As, and providing financing. In addition, we will also invest in "human resources", such as by enriching our training system for the development of skilled personnel, and we wi l l engage in "IT/equipment investment," such as building internal systems. Over the course of five years, we plan to invest a total of ¥200.0 billion. With respect to M&As, we are also considering allocating some of our roughly ¥160.0 billion of cash on hand to serve as contingency funds.
In business investment, we will also invest in intangible assets to grow our service-type business, and we plan to provide services such as appli cations while handling everything from system construction to data center operation. Some of these initiatives are already being carried out for financial institutions, but our efforts have not been sufficient for other markets, so we aim to expand our investment in these areas.
As for M&As, our policy is to consider the acquisition of companies whose technologies and resources can supplement those that we lack in each focus area so that we can expand our business areas and create new service-type businesses. Of course, reinforcing our service/outsourcing will continue to be a major priority, and, as always, we will carry out M&As when they are needed to enhance our functions. We also recognize the expansion of our security field business as being especially vital in the future. The combining of cyber security and physical security is one of our strengths, so we will continue to actively engage in co-creation with companies that have distinctive technologies. We can leverage the high level of compatibility between the imaging solutions field, a part of our physical security business, and the Canon brand as we further elevate our ability to solve the issues that society is confronting.
We are incorporating these initiatives in our Medium-Term Management Plan, which is focused on material issues based on our Purpose. We will make steady progress towards our new vision of being a corporate group dedicated to creating new businesses, while at the same time accelerating our development of solutions to social issues.

The keys to achieving our IT solutions sales target of ¥500.0 billion, set in our 26-30 Long-Term Objectives, will be expanding our service-type business and growing our service/outsourcing business. For us to expand our profitable IT solutions business, I don't think it would be any exaggeration to say that it is vital that we reach ¥200.0 billion in net sales for service/outsourcing, which is our most profitable business.
​We have defined four focus areas and set KPIs for each. For large corporations and quasi-major and upper medium-sized enterprises, we have set KPIs for "value creation integration" through imaging and AI solutions and the like, and for "business process services (BPS)" that use BPO and IT outsourcing. For small and medium-sized enterprises, we have set KPIs for "full support for SMEs." For all customers, we have set KPIs for "total security", which includes cyber-physical and cloud security services. We will formulate and implement strategies based on the needs of each area and customer type. Our vision for 2030 is one in which 40% of IT solutions sales come from service/outsourcing.
​Another essential part of growing our IT solutions business will be our initiatives in generative AI. We are already making progress with deploying generative AI in our services, but as I mentioned earlier, we will also use the strengths of our experience and know-how that have been built up in-house through our efforts to improve operation efficiency and reinforce the extension of these strengths to outside the Company.
​We can build up our service-type business by supplying solutions that, of course, are based on a deep understanding of the challenges facing our industry and our customers, and which leverage our strengths, and by earning the trust of our customers. I don't see this as simply being a highly profitable business, but also as a business in which we stay by our customers' sides as their operations and challenges change, and we turn the relationship we build with those customers into value. I want us to pay close attention to and dedicate ourselves to this area, in part to ensure that our Group will grow sustainably over the next five, 10 years and beyond.

Our Group has a wide-ranging customer base, encompassing everything from large corporations to upper medium-sized enterprises and small and medium-sized enterprises and general consumers. Our business is also wide-ranging, covering both the sale of physical goods such as cameras, business machines, and semiconductor manufacturing-related equipment and the provision of IT services. Through our long history, we have built up extensive management resources, such as technologies and expertise within the Group. I am confident that a Group with such wide-ranging assets as our own is a rarity among our competitors, such as system integrators and office device manufacturers.
​In the Enterprise Segment, which serves large corporations and quasi-major and upper medium-sized enterprises, we don't just focus on general issues, but also understand our customers' operations at a deep level, proposing solutions that address latent issues that our customers haven't even noticed yet. By doing so, we have built up knowledge and expertise about their business types and operations.
​I once served as Director of Enterprise Business Unit and, at the same time, President of Canon IT Solutions Inc., so I understand, at a deep level, that the proposals our Group is able to provide because of its deep understanding of different business types and operations are beyond the abilities of our competitors. This is why we are regarded so highly by our customers' management teams. I believe this is one of our Group's unique strengths. And now we will maximize synergy with Primagest, which joined our Group in 2024. I believe that there is still great potential for business expansion, when in addition to leveraging both Primagest's technical capabilities and Canon MJ's customer base, we leverage each company's strengths to create new services. I think it is important that we continue to refine our strengths in this area, where we are poised to far surpass our competitors, in order to achieve our targets.
​Canon System & Support Inc. part of the Area Segment that is responsible for small and mediumsized enterprises, provides various full-support services, such as "Makasete IT," for small and mediumsized enterprises. There are many companies that are implementing DX for small and medium-sized enterprises, but one of the things that make Canon S&S notable is that it doesn't just solve issues in the IT field, but also covers management issues such as strengthening environmental management and corporate governance, IT investment planning, and even human resources development. I think this gives us a great competitive advantage. The top management in Canon S&S have previous experience with direct sales marketing. Accordingly, they understand customers at a deep level, and I feel that they can truly leverage their knowledge and expertise in creating customer-based service-type business by looking at the true problems being faced by enterprise managers.
​In the Consumer Segment, which is responsible for individual customers, we will reinforce our one-to-one marketing with "Canon IDs", accounts for individual consumers which are used by various services. We will communicate with individual customers using a personally tailored approach and promote the longterm use of Canon products. We will carry out fan base marketing for customers with a high level of interest in cameras, and also capture hybrid photo and video demand and create new Canon fans, firmly maintaining our top market share.
​For inkjet printers, we will use a market approach that accurately aligns with user print demand to aim for the top market share. We will also create new print value such as the value offered by mini photos.
​The industrial equipment, healthcare, and production printing businesses are part of the Professional Segment. In the industrial equipment business, semiconductor market demand is undergoing a massive global change, but corporate investment sentiment continues to rise. Along with our technical capabilities, our "discernment" also provides us with a competitive advantage. By matching our customers' increasingly diverse needs with state-of-the-art overseas technical innovations, we will further establish our position as a platform provider in specific areas. In the healthcare business, we are steadily generating synergy through the healthcare IT business integration of Canon Medical Systems Corporation and Canon ITS Medical Inc. in 2023, and the scale of our sales in this business is growing. Medical systems are transforming, and we will further promote IT solutions that are optimized for the medical field, primarily focusing on electronic medical records. In our production printing business, we will support the digital shift of the commercial printing market toward small lot and personalized printing, along with the transformation of workflows to become more efficient.

One of the Group's human resources strategies is the "development of skilled personnel." During the 26-30 Long-Term Objectives period, we plan to further accelerate the virtuous loop of our engagement improvement cycle starting with the "development of skilled personnel."
As part of these measures, in April 2025 we initiated an advanced ITS talent certification program that utilizes Digital Skill Standards (DSS)^*4 to certify the skill levels of employees in each business. Personnel are evaluated along the two axes of knowledge and track record to determine their level (between Level 1 and Level 5). Advanced ITS personnel at Level 4 or above are certified as DX experts. Development roadmaps are created for each level, and we are working to develop professionals by using those roadmaps to provide training and growth support. Our goal is to thoroughly conduct these initiatives, driven by a strong sense of motivation, and achieve a 100% position fulfillment rate for these professionals.
My vision for 2030 and beyond is to be a Group with technical and proposal capabilities that can address the problems faced not only by our customers but also the office equipment industry, IT service industry, and other industries of which we are a part, and even social issues that span multiple industries. To achieve this, we plan to implement measures to improve employee skills, not only for IT solutions but across all domains, dedicating ourselves to developing human resources that contribute to business creation.

In 2021, the five-year period of our previous Long-Term Management Objectives began during a very challenging time, in the midst of the COVID-19 pandemic, when the business environment was changing dramatically. The future outlook was one of even greater uncertainty, and it was my belief that if we were to raise the likelihood of our strategies succeeding, we needed to improve our field capabilities so that we could flexibly and rapidly respond to changes in the customer environment. It is precisely because we are in an age of uncertainty, where the future is unclear, that it is so important for everyone, from junior personnel to veterans, to take on challenges that cross existing lines, without fear of failure. We need to create an organization where that happens.
​As a member of top management, I strive to explain the broad direction of our management in clear, easyto-understand language, inspiring employees and giving them encouragement.
For example, during the 21-25 Long-Term Objectives period, in the activity policies for each fiscal year, I used simple key words and phrases like "accelerate," "take on challenges," "accomplish," and "attempt." I communicated whenever I had the opportunity, such as in various forms of meetings and monthly messages directed at all employees. The business unit directors and division managers that manage individual workplaces understand my vision and think, on their own, about what it is that they should be doing. They incorporate their conclusions in concrete activities, tenaciously leading their organizations with a strong sense of resolve and responsibility. Under their leadership, the employees out in the field draw on every last drop of their knowledge, trying new approaches. Needless to say, the results we have achieved are the product of their efforts and their ingenuity. I think one of the factors behind our achievement of our targets has been the strong sense of unity within our Group, with business managers and employees on the field connected through these messages from top management.
​Ever since I was put in a leadership position in the organization, I have consistently practiced a policy of "entrust, but don't neglect." This way of thinking says that you should give only the instructions and advice that are essential, and then leave the rest up to the discretion of those on the field. I have communicated this policy to managers on the field through training and in other ways. When it comes to work that is challenging for the people you manage, even as you leave it up to them, you need to keep a close eye on them, speak up when the circumstances require it, provide advice, and promote their growth. I have also explained that to do that, you need to ensure "psychological safety."
Due in part to my consistently sharing this message, I have heard that people on the field are actively speaking up, saying that they want to try this or that, based on the policy of "entrust, but don't neglect." I feel that we have fostered a strong organizational culture of actively taking on challenges. I feel that the Canon MJ Group Purpose, formulated in 2024, also unites the spirits of our Group employees, creating this kind of positive change. I think it has given a significant boost to the Group's efforts. Our Group's greatest asset is our people, so to tap the full potential of each and every employee, I want to ensure that this is not a passing phase but becomes even more fully established as a part of the Group's overall culture.​

With respect to governance, during the 21-25 Long-Term Objectives period, we made steady progress in establishing a system for ensuring sound management, including increasing the number of outside directors, appointing female outside directors, changing the composition of the Nomination and Remuneration Committee, and establishing a Special Committee.
Of course, we see the enhancement of governance as an ongoing challenge, and we will continue to earnestly deliberate and discuss various issues, such as our organizational design and the composition of our Board of Directors, making changes as necessary. However, there is no point in simply having the right structure or format if they aren't matched by the underlying reality. What is essential is to have an effective governance system.
To make our governance system more effective, we conduct Executive Officer Meeting retreats twice a year with the aims of leveraging the diversity of executives to enrich dialogue between them and aligning their recognition of the issues faced by the Group. Executives, including outside directors, all come together and engage in unrushed discussions. They come to understand each other at a deeper level, and I feel it is clear that this improves the quality of the discussions by the Board of Directors, the Nomination and Remuneration Committee, and the Special Committee over the course of the year. Our outside directors provide accurate advice from the perspective of overseeing management. In that sense, we recognize our Group as making ongoing improvements to the quality of its effective governance.
Our Nomination and Remuneration Committee, over half of whose members are outside directors, is also discussing the selection of candidates for the next generation of management, including my own successor. With respect to personnel development, our Human Resources Strategy Committee is deliberating specific development measures, and is already implementing various personnel development measures. These include the enhancement of skills through "Quorum 12" and "Quorum 15"^*5 training sessions in business school for select next-generation managerial personnel, and also "cross-boundary learning," in which participants learn about management through actual practice in other companies. As we head toward 2030, we hope, by further enriching measures such as these, to establish a system in which we are always developing multiple next-generation managerial personnel.