NYK President Takaya Soga addressed the group’s employees on October 2 to mark the 139th anniversary of the company’s founding.

Today is the 139th anniversary of NYK’s founding, and it is a great pleasure for me to celebrate this day with you. I would like to thank all of you for your daily efforts and pay tribute to our predecessors who desperately overcame many difficulties throughout history.

On this occasion, I would like to share a few words with you.

First, I would like to discuss the environment surrounding us. The world has finally emerged from the COVID-19 pandemic, and economic activities have returned to their previous state. However, during the pandemic, funds flowed into the stock market due to the financial easing policies of various governments, leading to an overheated rise in stock prices. Additionally, differing policy interest rates among countries have caused excessive yen depreciation. This extreme trading in the financial markets, which diverges from the real economy, significantly impacts our business activities. Moreover, the increasingly serious patterns of "conflict and division" in various global sectors overlap with the fragmentation of economic zones, creating a crisis for free economies and posing threats to the safety of our corporate activities. Domestically, the labor shortage has become a common issue across all industries, and our group also faces significant challenges in securing the crew and engineers essential for our operations.

Amidst these significant environmental changes, which can be described as the tides of a new era, we must maintain a high level of awareness and sensitivity to the changing winds. We should boldly and swiftly revise our hypotheses, which serve as signposts for executing our respective businesses when necessary. Additionally, the NYK Group must demonstrate teamwork with a sense of unity.

One of the major signposts for us is the medium-term management plan, which has entered its second year. To recap, the key point of this plan is to deepen our core businesses based on ESG management or sustainability management. We aim to utilize the funds generated from this deepening to develop new businesses, further enhancing corporate value. To support this, we are creating an environment where each employee can thrive by showcasing their individuality and abilities, establishing innovative ideas and digital business processes, and fulfilling our commitment as a shipping and logistics company to contribute to the energy transition requested by society.

Reflecting on the progress of the current medium-term plan, we have made adjustments to our hypotheses, including withdrawing from businesses potentially related to sanctions and reviewing our business structure. Necessary investments in business acquisitions and new ship orders are proceeding as planned, leading to the deepening of our core businesses. Additionally, regarding the development of new businesses, particularly in decarbonization, we are gradually producing results under the keyword "co-creation," involving shipyards, marine equipment manufacturers, overseas partners, local governments, customers, and media. In terms of energy transition, all divisions have pooled their ideas to successfully kick off our ambitious GHG emission reduction targets announced in the NYK Group Decarbonization Story.

With the start of the EU-ETS (European Union Emissions Trading System) this year, we have responded effectively thanks to the thorough preparations led by the ESG Strategy Headquarters. Furthermore, the FuelEU Maritime initiative will begin next year. As GHG emissions become a cost, there is a significant risk of significantly impairing profits depending on our navigation. Although the number of vessels in our fleet is still limited, we anticipate that the fuel transition we have undertaken ahead of other shipping companies will work to our advantage under the regulations, validating our medium-term hypotheses.

On the other hand, the areas related to "people" and "technology" are positioned more as "strengthening" rather than mere "hypothesis modification." Regarding "people," we are rapidly working on establishing a system where each of our 35,000 colleagues around the world can thrive by showcasing their individuality and abilities. Efforts are underway to promote the understanding and dissemination of D&I (Diversity & Inclusion) throughout the group. Additionally, we are advancing the CX NEO* initiative aimed at enhancing the positioning and motivation of our maritime employees, who are the source of our competitive advantage in corporate activities.

As for "technology," we take pride in our group's technological capabilities toward decarbonization, which are among the best in the shipping industry. However, we cannot always secure additional personnel in line with our business expansion, making "labor-saving" an area we must emphasize in our technological efforts. DX (Digital Transformation) supports this, which we will pursue to ensure that high-quality operations can be conducted with limited personnel across land offices, maritime sites, and logistics warehouses. We have already begun various initiatives, including establishing advanced maritime and land communication systems, testing autonomous vessels, researching simulation technology in collaboration with shipyards, and setting up automated warehouses incorporating delivery robots. However, I want everyone to constantly consider reviewing business processes with a mindset of "labor-saving" in their daily work.

Conversely, as we deepen our DX efforts, the risk of cyberattacks also increases. While we will continue our efforts to enhance the defensive capabilities of the entire group, let us not forget that, ultimately, the awareness and vigilance of each individual, including myself, will serve as our stronghold.

Capital policy is another major pillar of our medium-term management plan. In particular, regarding our return policy, we are adjusting to ensure that profits accumulated beyond our plans are appropriately returned while considering the balance with investments. I intend to address not only our shareholders but also our essential stakeholders and employees in a manner that goes beyond just wages.

On October 1, a new cabinet was inaugurated in Japan. Israel has invaded Lebanon, and Iran has fired missiles at Israel in retaliation. The situation in the Middle East is becoming even more chaotic, and it is also very uncertain what will happen in the world after next month's presidential election in the United States.

Despite the significant upheavals in this era and changes in the business environment, just like our predecessors, let us face this turbulent sea with brightness, boldness, and flexibility, ensuring no one is left behind. Let us look forward to celebrating our 140th anniversary next year with vitality.

That concludes my remarks, which have been somewhat macro today, but these are my greetings on the anniversary of NYK’s founding.



* An internal project targeted at marine professionals. The aim is to enable seafarers to pursue their careers more positively by identifying and examining various challenges surrounding them, such as "work styles for marine professionals," "career paths," and "onboard environments." By reviewing and improving these aspects, the project seeks to reduce the turnover rate of marine professionals and support the achievement of the medium-term management plan from the perspective of Corporate Transformation (CX).