President and Representative Director, Group CEO

Goro Kamino

From Integrated Report 2026

―――Aichi Founders Museum is housed within STATION Ai, a startup hub located in Nagoya City, Aichi Prefecture. It features Saburo Kamino, who was involved in the founding of Toyohashi Gas and Hamamatsu Gas, the roots of the SALA Group, as one of the entrepreneurs with connections to Aichi Prefecture. Could you share with us the corporate philosophy that has been passed down ever since the founding, and the thoughts you have invested in your businesses?

The origin of Saburo Kamino's business activities can be traced to the Jinno Shinden Development land reclamation project. He took on the role of on-site manager at the young age of 19, and successfully completed the difficult embankment construction by incorporating the then-latest artificial-stone technology developed by Choshichi Hattori. Upon its completion, he was entrusted with managing the newly reclaimed land and paddy fields (shinden is literally new paddy field), and worked tirelessly to improve the living conditions of the settlers. His guiding belief was koeki (public interest) — he constantly asked whether his actions would be meaningful for society and for the local community. Once the management of the reclaimed land was on track, he devoted himself to businesses that would enrich people's lives and contribute to the development of society, including city gas, railways, and insurance. The pioneering spirit and progressive ethos behind the idea that "tomorrow should be better than today, just as today is better than yesterday", the drive to enrich the foundations of community life, has become the foundation of our current SALA Group philosophy, namely, the wish to "continue creating more beautiful and enriched lifestyles." In formulating our 2030 Vision, our aspirational image, and the 6th Medium-Term Management Plan announced in January 2026, we once again reaffirmed our strong awareness of our mission to "realize enriched lifestyles" and "enrich the regional economy."

―――In formulating the newly announced 6th Medium-Term Management Plan (2026–2030) (hereinafter, "the MTMP"), we understand that you held a board retreat with extensive discussions. What kinds of topics did you discuss?

We named the board retreat "Beyond 2030," creating an opportunity to discuss management from a backcasting perspective, looking beyond 2030 into the future. Alongside our outside directors we also brought in next-generation leaders from our operating companies, and the resulting discussions were more spirited than ever before. When you are engaged in day-to-day business execution, your attention inevitably tends to focus on short-term events and your own areas of responsibility. Therefore, in the first session of "Beyond 2030," we looked back at the history of the SALA Group, returned to our founding spirit, and once again confirmed together as a group who we are. Once again, our spirit of initiative emerged as one of the points of focus. Even in this era of change, we renewed our resolve to actively take on challenges and continue to be an indispensable corporate group working toward "the realization of enriched lifestyles and society."

In the subsequent sessions, we thoroughly discussed what kind of future lies beyond 2030 and what aspirational image the SALA Group should pursue in such a future. We discussed and reached a shared understanding of what we should do for the future from a long-term perspective. This MTMP was formulated on the basis of these discussions.

―――What kinds of discussions took place regarding the changes beyond 2030, in "Beyond 2030"?

The fact is that we are now in a "hyper-information society." Through smartphones and tech giants such as Google, the coordination and control of various functions and information have made it easier for dramatic changes to emerge in all business areas. The impact of technological innovation and the widespread adoption of AI, robotics, and other technologies is also significant. We can readily imagine a future in which robotics-driven automation extends beyond manufacturing into medicine, logistics, and even driving, becoming part of daily infrastructure. In the field of environment and energy as well, society is transitioning from the simple paradigm of large-scale generation, transmission, and consumption using fossil fuels to a society that controls, optimizes, and increases the efficiency of decentralized supply-and-demand systems incorporating renewable energy and energy storage.

In such an era, rather than demonstrating expertise on a business-by-business basis as we have until now, what is required is comprehensive proposal capability, bringing together multiple businesses based on a deep understanding of customer needs and collaborating with external partners as necessary. In this regard, the SALA Group not only offers a wide range of businesses but also possesses overwhelming strength in the trusting relationships built up with customers in each business setting. To leverage these strengths, we need to "cross our businesses", in other words, we believe that developing total coordination through cross-functional thinking will be the key to future growth.

Against this backdrop, we have set the basic policy of this MTMP as "X (Cross) 120*." In the previous MTMP, we set "Go Beyond Boundaries" as the basic policy and engaged in various initiatives for collaboration and co-creation. We now aim to go beyond those boundaries and "X" (Cross: intersect, collaborate, and co-create), achieve transformation, and create new value.

* The figure "120" reflects both the fact that we will mark our 120th anniversary in 2029, and the consolidated operating profit target of ¥12 billion (i.e. 120 oku where 1 oku=100 million) for the final year of this MTMP.

―――What kinds of discussions took place regarding the changes beyond 2030, in "Beyond 2030"?

The final session of the "Beyond 2030" Board of Directors retreat was an intensive discussion on management challenges and risks based on the two days of preceding deliberations. In fact, our outside director Kazutaka Okubo has been regularly conducting risk management training sessions for the past five years or so, bringing together corporate members and the management of each business. A distinctive feature is to visualize the risks of each major business on a risk map built from two axes, “degree of impact on business performance” and “degree of need for risk control activities,” across four quadrants,  then drilling into causes and countermeasures. This time, for the first time, we held discussions at the board level, and revisited each business's risk map with an eye on the future beyond 2030.

In this discussion, the top risks that were common across businesses, those with significant impact on performance and requiring strong risk control, included responding to large-scale earthquakes, addressing the shift toward a decarbonized society, securing and developing human resources, and addressing cyber risks. Regarding the securing and development of human resources in particular, we developed a strong recognition that securing and developing the human resources needed to execute business transformation toward "Beyond 2030" will be a major challenge. Based on these discussions, in this MTMP we have set the recruitment, development, retention, and engagement enhancement of human resources as one of our key strategies, and we plan to clarify the human resource portfolio for each business and roll out HR measures accordingly.

―――In expanding the housing business, the shortage of construction workers must also be a serious challenge.

Indeed, in the risk maps for the Engineering & Maintenance business and the Housing business, securing construction capacity is listed as one of the top risks. We have heard from our partner companies that "it is becoming difficult to secure skilled workers," and if we do not seek a fundamental solution now, this could have serious consequences in the future. Therefore, going forward, we will strengthen our approach of recruiting and developing human resources in-house. Moreover, we envision developing multi-skilled workers capable of handling not only housing construction but also all kinds of foundational infrastructure such as gas, electricity, water, and telecommunications. Furthermore, for employees who aspire to become independent, we would be delighted to offer entrepreneurship as one option, so that they might maintain a partnership with the SALA Group while supporting the lives of local communities. From the perspective of nurturing partners (individuals and companies) who can work together with us to enrich community life, we also think it would be worthwhile to take on this challenge in earnest, perhaps even in the form of a school.

―――Late last year, you held an "All-Employee Meeting" to communicate the history and identity of the SALA Group.

At the start of the new MTMP, we wanted to once again look back at the origins of the SALA Group and share with our employees the values and mission that we should cherish. No matter how much technology advances, we cannot expect growth unless we have a clear understanding of what we should do as individuals and as an organization. These days, even solutions to social issues may be provided by AI. AI gives plausible answers based on past data and the relationships among them. However, what truly moves people is the existence of shared values and the presence of creativity and storytelling. While I cannot say how far AI will be able to go, I personally still want to believe in humanity, in human wisdom.

I also conveyed another message to our employees: while cherishing relationships of trust with customers, by "crossing" (collaborating and co-creating) with other businesses and companies and adding the ability to make forward-looking proposals, we as individuals and as a company can achieve even greater growth. For example, when a customer's ENE-FARM (household fuel cell) reaches the end of its service life, rather than simply proposing equipment replacement, we hope our employees will broaden their thinking even further to enrich customers' lives. This means discussing not only running costs but also the high resilience of a hybrid system combining gas and electricity, energy conservation, energy generation, and even topics related to bathrooms and kitchens, doing whatever we can to make customer lifestyles more enriched.

For our business-to-business (BtoB) proposals as well, in eastern Aichi Prefecture, capital investment by manufacturing companies in new factory construction is active. We receive a wide range of consultations, from energy-related matters to factory efficiency improvements and even housing-related matters that come with securing employees.

Regarding employment issues in particular, short-term workers may be accommodated simply by providing dormitories, but quite a few people wish to settle in the area, so a variety of options is required depending on individual circumstances, including rental properties and detached houses. At SALA Real Estate, we have begun focusing on the comprehensive housing business centered on renovation, which includes co-living*, an arrangement seeing growing demand recently, and the renovation and utilization of vacant houses.

For example, an older customer sells their suburban home early and relocates to a senior co-living development in a transit-accessible area; the property SALA Group acquires is then repositioned as a rental detached house for the next generation. The SALA Group is also capable of providing such a cycle, a flow of asset monetization that enables relocation, along with real estate utilization for the next generation.

* Co-living: A living arrangement that combines shared housing and co-working, integrating living, working, and interaction. Such properties are well-equipped with facilities and systems for work and community.

―――This MTMP also announces an expansion of the business area.

Until now, we have developed our businesses centered on eastern Aichi Prefecture, where our headquarters in Toyohashi City is located, and western Shizuoka Prefecture, which includes Hamamatsu City. In these cities, the value of manufactured goods shipments has grown dramatically even during what is called Japan's "lost 30 years," and we expect new investment to continue, centered on manufacturing. For businesses rooted in this region, we will continue to drive top-line and profitability improvements. Going forward, in addition to these areas, we plan to expand our business into western Aichi Prefecture, including Nagoya City, as well as Shizuoka and the Kanto region. In each of these areas, we will first link our renovation-centered comprehensive housing business centered on renovation with our existing business infrastructure to provide products and services optimal for our customers. This is a new business model that integrates the strengths held by Yasue Corporation, which became part of the SALA Group in 2024. We will first establish the comprehensive housing business centered on renovation in western Aichi Prefecture, including Nagoya City, where Yasue Corporation has its main base of operations, and then expand to other areas.

―――In this MTMP, the areas you have decided to address are "E (Energy & Environment)," "Food," and "Living." Regarding "E (Energy & Environment)," you have stated that you will expand the electric power business. What direction are you considering?

The SALA Group entered the electric power business in 2015, ahead of the full liberalization of electricity retail in April 2016, and began commercial operation of the Higashi Mikawa Biomass Power Station in Toyohashi City in 2019. In 2025, we constructed and began commercial operation of grid-scale battery storage in Hamamatsu City and renewable energy-coupled battery storage in Toyohashi City. By stepping into the field of electricity supply-and-demand management in the local region, we have been able to grasp various issues.

In this MTMP, we will focus particularly on supporting energy storage on the customer side and expand the electricity business. For individuals, we will actively propose household storage batteries, and for businesses, we will propose industrial storage batteries for factories and facilities that have adopted solar power generation and similar systems, supporting their responses to carbon neutrality, enhancing resilience, and improving energy efficiency. While major electric power companies and trading companies are developing fund-type businesses in the storage battery field on a scale of hundreds of billions of yen, the SALA Group will leverage its strength of customer touchpoints to steadily build up volume through locally rooted initiatives.

―――Regarding the "Food" field, you have referred to producers and chefs as "Food Creators" and have spoken of your aspiration to develop eastern Aichi Prefecture (Higashi Mikawa) as a sacred ground for them. In this MTMP, are you taking the "Higashi Mikawa Food Valley Concept", which you have promoted thus far, one step further to nurture it as your next business?

Eastern Aichi Prefecture is blessed in terms of climate and transportation infrastructure, and its agricultural output value ranks among the top in Japan. Since opening Hotel Arc Riche Toyohashi in 2008, the SALA Group has expanded its network of dedicated local producers. The local producers leverage the resources of this land to create truly remarkable products. Wishing to spread their appeal and contribute to regional revitalization, we have advanced the "Higashi Mikawa Food Valley Concept." Recently, local products are being highly evaluated at restaurants in Tokyo and Nagoya, but we believe there is still much more potential for branding. In fact, agricultural output value has shown almost no growth compared to the 1990s. Furthermore, issues such as a lack of successors and abandoned farmland are becoming serious, and when we consider future investments in mechanization and DX utilization, there is significant scope for what companies can contribute.

With this mindset, in January 2025 we established SALA Agri and, in partnership with Nihon Agri, Inc., a pioneer among agricultural ventures, began cultivating kiwifruit and other crops as we embarked on the commercialization of agriculture. While this MTMP represents a "seed-sowing" period, we hope to accumulate know-how through this experience for high-value-added agriculture that integrates production, distribution, and sales, and to grow our food and agriculture business into one of the pillars of our operations beyond 2030.

―――"Living" includes not only housing and lifestyles, but also social infrastructure. How is the progress of the project to realize synergy with Yasue Corporation, which joined the Group in December 2024?

As I mentioned earlier, Yasue Corporation not only achieves high customer satisfaction but also has excellent business processes that generate high productivity and profitability, with much for us to learn. The deciding factor in our agreement to work together was that we shared common principles and values regarding "cherishing connections and trust with local communities and customers." As the company was listed on the Tokyo Stock Exchange Standard Market, it became a consolidated subsidiary through a tender offer (TOB). With mutual empathy for each other's principles, we are currently advancing the integration project in cooperation. We are analyzing both companies' business processes and strengths in detail and considering a structure that can make the most of each other's know-how. We are moving in the direction of reconstructing the housing and renovation-related business, rather than just continuing on as an extension of the past, including the corporate structure and the way brands are deployed. During this fiscal year, we plan to announce specific plans for realizing synergies.

―――As a corporate group listed on the Tokyo Stock Exchange Prime Market, how do you engage with the capital markets? Please share with us the thinking you value when engaging with the capital markets.

Over the past several years, at the Board of Directors and at the Management Meeting comprised of full-time directors, we have held repeated discussions on PBR improvement. What we have emphasized throughout is dialogue with investors. We believe it is important to clearly communicate our thinking to a diverse range of investors and gain their understanding, while also striving to understand the issues that investors view as priorities. In fact, last year, for the first time at the Board of Directors, we held a dialogue with the Institutional Investors Collective Engagement Forum. Based on insights gained through dialogue with investors, we are implementing the following measures to meet the expectations of the capital markets.

In our new MTMP, we have set an ROE target of 10% for 2030, the final year. To realize this target, we plan to incorporate ROIC targets for each business and roll them out down to the operational level. The SALA Group's largest shareholder is the Employee Stock Ownership Association. We will continue to communicate to our employees that their work is connected to the corporate value of the Group, conveying the significance of the SALA Group and the fact that we are a company that creates value and grows together with local communities. Going forward, we will continue to ask ourselves what we can do to enhance both corporate value and social value, and to continue creating "beautiful and enriched lifestyles" so that we may continue to be a presence needed by all our stakeholders.

Corporate Actions toward PBR Improvement

Interviewer : Mr. Nobuyasu Tanaka

President, Representative Director, & CEO, Sinc Inc.

President & Representative Director, Sun Messe Co., Ltd.