Message from the CEO

Over the past four decades, I have built my career in the financial services industry, both in Japan and overseas, and have observed a wide range of companies. Through this experience, I have come to firmly believe one thing: the more successful a company is today, the harder it is for it to change. Companies with highly capable employees, functioning business models, and a certain level of earnings tend to find it difficult to feel a sense of urgency and to face the need for transformation head-on. However, changes in the business environment do not wait. The competitive environment is constantly and inexorably changing. Time and again, I have seen companies whose management options were already limited by the time those changes became visible in their financial results. This is why a complacent mindset is extremely dangerous. Precisely because problems have not yet surfaced and we still have many options open to us, now is the time to pursue transformation.

Since becoming CEO in April 2023, I have consistently communicated both inside and outside the Group my strong belief that we must transform into an organization that is truly chosen by stakeholders over the next 10 years and beyond. This does not mean simply expanding our scale or pursuing short-term results. Rather, my message is that we must continue evolving into an organization with true underlying strength—one that can keep creating value even as the business environment changes. I have also said that I want Mitsubishi HC Capital Group to be an organization where employees are satisfied and happy, and one that is trusted and respected by society. These are not emotional slogans. They are highly practical considerations for enhancing corporate value over the medium to long term amid an uncertain external environment, and they are grounded in my firm conviction as a business leader. To transform Mitsubishi HC Capital Group into such an organization, I have persistently communicated to employees the need for transformation, almost to the point of repetition. In the 2025 MTMP, our first medium-term management plan since the 2021 business integration of Mitsubishi UFJ Lease & Finance and Hitachi Capital, which covered the three years through the previous fiscal year, we incorporated frameworks to promote transformation across various initiatives. Through these efforts, I feel that the momentum for transformation has been growing within the Group, and that a mindset for transformation has begun to take root across the organization. Even so, I have not yet been able to dispel my strong sense of crisis that the Group may no longer exist 10 years from now. We launched our new 2028 MTMP this fiscal year, and I believe we must continue to drive transformation with strong determination.

Looking back on the 2025 MTMP, we implemented a wide range of transformation initiatives as the first stage toward Our FY2031 Vision.^*1 These included gaining a solid foothold by restructuring and redefining existing business domains, sowing seeds in new business domains, and the evolution and layering of business models to transform our business portfolio.

Through these initiatives, despite both positive and negative changes in the business environment that we had not anticipated when the 2025 MTMP began, we met our net income target in each of the three years of the 2025 MTMP, and achieved record-high net income for four consecutive fiscal years. Reflecting this solid performance, our stock price rose in tandem with the upward trend in the Japanese stock market, enabling us to reach a P/B ratio of around 1.0, which we had positioned as an initial milestone. I regard all of these as significant achievements.

At the same time, we fell short of our financial targets for profitability, namely our ROE and ROA. The direct causes included sluggishness and underperformance in certain businesses, as well as the slow pace of our business portfolio transformation. However, the underlying reason was that, because this was our first medium-term management plan after the integration, all executives and employees across the Group prioritized achieving a more intuitive target of profit in absolute terms. As a result, we were unable to give profitability ratios such as ROE and ROA the same level of attention that we gave to the amount of profit. This is my responsibility as CEO, and it is a challenge we have carried over into the 2028 MTMP.

Regarding internal transformation, the frameworks to promote transformation I mentioned earlier have fostered momentum for transformation and a willingness to take on challenges among executives and employees. I have also begun to hear people outside the Group say things such as, “Mitsubishi HC Capital seems to be doing many new things lately,” or “I’ve been hearing more about Mitsubishi HC Capital recently.” Whenever I hear such comments, I feel that our transformation is steadily bearing fruit. However, for employees across the Group to embrace new initiatives and challenges spontaneously on a daily basis even without such measures, we need to elevate transformation to a stage where it becomes embedded in our corporate culture. This is another challenge that remains to be addressed.

In the 2028 MTMP, which began this fiscal year, I am committed to taking stronger leadership as CEO in addressing these two remaining challenges from the 2025 MTMP.

Through various initiatives to date, we have fostered momentum for transformation within the Group. Under the 2028 MTMP, we will move toward embedding this mindset into our corporate culture. At the beginning of this message, I said that I have not yet been able to dispel my strong sense of crisis that the Group may no longer exist 10 years from now. Behind this is the fact that I still see symptoms of what is often called big company disease within the Group: precedent-based thinking that seeks to continue doing things the way they have always been done, a culture of waiting for instructions rather than thinking independently and taking ownership of decisions, and sectionalism, or a silo mentality, where people only think about their own departments. I believe this may partly be because the Group became larger following the business integration in 2021, and this deeply concerns me. Such tendencies not only impede transformation but could also weaken the organization and threaten the survival of the Group. I want to nip them in the bud, while they are still small. For this reason as well, we must embed a mindset of transformation and challenge into our corporate culture—and doing so requires change significant enough that people both inside and outside the Group can feel that Mitsubishi HC Capital has changed. Under the 2025 MTMP, I asked employees to practice trial and error. Under the 2028 MTMP, we will go further by encouraging employees to try, learn from failure, and try again.

The source and starting point of every strategy lies in people and corporate culture. No matter how outstanding a strategy may be, it will not produce results unless the people who execute it change their behavior. We are truly committed to transforming our corporate culture so that it becomes the norm for each employee to think independently and continue taking on challenges, and so that the accumulation of these efforts translates into competitiveness across the entire organization.

Above all, I firmly believe that our people are our greatest asset—and that everything begins with them.

To realize Our FY2031 Vision, we need to evolve our way of doing business and the very nature of the Group itself. Through the 2025 MTMP, we built the foundation for transformation, and that mindset has steadily begun to take root. However, to translate this transformation into tangible results in the form of enhanced corporate value, we must take our efforts one step further and deliver clear outcomes.

The Group’s transformation is now in a transitional phase, moving from emergence to expansion. At this stage, what matters is not simply recognizing the need for transformation but seeing it through and turning it into lasting results. If we try to move on to the next stage without sufficient execution capabilities, the initiatives we have built up so far may end up being temporary, and we run the risk of reverting to our previous trajectory.

In that sense, I regard the three years of the 2028 MTMP as an extremely important turning point. Our FY2031 Vision, which is our medium- to long-term aspiration, will not be realized simply with the passage of time. We can only move closer to realizing it by steadily advancing transformation at pivotal moments like this. The 2028 MTMP is a particularly important milestone because its outcome will directly shape our future growth trajectory. As such, we position it as the phase in which we will raise profitability and accelerate the enhancement of corporate value. We will shift the focus of our management toward high-quality growth centered on capital efficiency and profitability, and as a result evolve into an organization capable of sustainably creating value.

In an uncertain business environment, simply responding to change is not enough. We need the ability to create change ourselves and turn its results into sustainable growth. To this end, as I have stated, we will drive both a shift to profitability-focused management and a further deepening of corporate culture transformation under the 2028 MTMP. We will not allow transformation to end as a temporary initiative; instead, we will elevate it into a source of organizational competitiveness. Our transformation is still in progress, but corporate value is steadily increasing, and the foundation for medium- to long-term growth is firmly taking shape. Above all, we have the ability to embrace change and open up our own path to growth. I am confident that our future is bright and that we are ready to take a bold step toward further growth.

In an uncertain business environment, we need the ability to create change ourselves and turn its results into sustainable growth.

So far, I have consistently emphasized the need for transformation. Finally, I would like to share two things that I believe, as CEO, we should not change.

The external environment surrounding the Group is becoming more uncertain than ever, marked by developments such as the rollback of globalization, global fragmentation and shifts in the world order, instability in the Middle East, and the rapid advancement of AI and the expansion of related markets. These changes go beyond ordinary economic cycles: they are reshaping industrial structures and the competitive landscape itself, demanding more flexible and rapid decision-making and stronger execution capabilities.

Amid such uncertainty, it is essential that we not be swayed by the external environment. Instead, we must clearly define our own strengths and direction, calmly assess the situation, accurately weigh risks and opportunities, and independently formulate and execute growth strategies. To do so, we must combine the flexibility to respond to short-term changes in the environment with the discipline to maintain unwavering principles over the medium to long term.

These principles for the Group are expressed in Our Mission: “Contribute to a prosperous and sustainable future by creating social value through maximizing the potential of assets.” In other words, it means keeping assets at the heart of everything we do. We have created value for both businesses and society not only through leasing and finance, but also by recognizing the value of assets from multiple perspectives and unlocking their potential. I believe that the expertise we have accumulated as asset specialists is the source of our competitive advantage.

Going forward, we will need to further evolve our business model in response to changes in the business environment. We will likely change our business domains and earnings structure, and even the way we create value. At the same time, however, no matter how we change, our core strength and dedication to maximizing the potential of assets will never waver. Boldly changing what should be changed while never wavering on the principles we must uphold—this is what will enable us to achieve sustainable growth even in an uncertain business environment. As CEO, I am determined to stay true to these principles and continue taking on challenges without fear of change. This is the first thing I believe we should not change.