Suntory Beverage and Food Ltd.’s new Chief Executive Makiko Ono, who spent much of her career driving foreign acquisitions as one of the few women working abroad at the company, now seeks to deliver growth via a similar strategy to take advantage of changes in consumer behavior after Covid.
(Bloomberg) — Suntory Beverage and Food Ltd.’s new Chief Executive Makiko Ono, who spent much of her career driving foreign acquisitions as one of the few women working abroad at the company, now seeks to deliver growth via a similar strategy to take advantage of changes in consumer behavior after Covid.
The company is seeking M&A opportunities totaling as much as ¥700 billion ($5.4 billion) over the next few years, the 63-year old, who assumed the top job on March 24, said in an interview. While Suntory’s acquisition strategy is yet to be finalized, the company sees potential in health-related drinks in the US, Asia and regions where Suntory has currently little presence, she said.
“Consumers are becoming more health conscious both mentally and physically,” Ono said, explaining that the impact of Covid and remote work have led to more growth opportunities in products such as energy drinks, tea and canned coffee.
Ono is the first female CEO of a listed Japanese company with a market capitalization of more than ¥1 trillion, and takes the helm as the business looks to strengthen existing brands and accelerate overseas expansion amid a declining population and soaring costs in Japan. She was also the first woman to work overseas at Suntory Beverage and Food, Japan’s second-largest drinks company after Coca-Cola Co. by sales, according to data from industry research company Inryo Souken.
Women remain extremely rare in the upper ranks of corporate Japan. Less than 13% of executives at publicly traded companies are women, according to a JPMorgan Securities Japan Co. report this month. The number ranks the lowest among the Group of Seven nations, and compares with 45.3% of female executives in France and 29.7% in the US.
Japan has held a goal since 2003 to have 30% of managerial positions filled by women. In the lower managerial ranks, however, Suntory Beverage’s gender diversity still falls short, with the proportion of female managers currently at 6.8% compared with 13% at its parent company. Ono attributes that discrepancy to the fact that it’s hard for women to work in factory roles at Suntory Beverage that sometimes involve night shifts as it’s hard to balance that with family responsibilities, so fewer women are able to rise through the ranks.
Still, some analysts see Ono’s appointment as an encouraging sign of change.
“This is traditionally a very male dominant industry with drinks and alcohol,” said Aisa Ogoshi, a fund manager at JPMorgan Asset Management in Tokyo. “So for Suntory to promote a female CEO, it very symbolic as it is a sign that management is thinking seriously about board diversity.”
Ono joined the soft-drink company’s parent, which later became Suntory Holdings Ltd., in 1982 after graduating from the Tokyo University of Foreign Studies.
“I was fortunate to be surrounded by open-minded colleagues with overseas experiences,” said Ono, who recalled how female employees were assumed to be serving tea in the office back in the 1980s when she first started. Seeing that opportunities to be stationed abroad were prioritized for male employees, she raised her voice and earned herself a position in France. During her time abroad, she oversaw European deals including the acquisition of French soda brand Orangina, and Lucozade and Ribena in the UK.
The company’s former CEO Kazuhiro Saito considers Ono “an excellent choice” given her deep knowledge of the sector and her decisiveness in restructuring the European beverage business, SMBC Nikko analyst Naomi Takagi wrote in a note last month citing a meeting the company held with analysts recently. Suntory Beverage’s stock has risen 8.6% so far this year, outperforming the Topix Food Index of 4.6% and the wider Topix benchmark of 3.6%.
Ono hopes that the company will see a higher percentage of women in management positions, but said that change in Japan must start at a deeper societal level. For example, while Suntory encourages male employees to take paternity leave, the government should also look to support businesses such as housekeeping services, she added.
“The environment needs to change to accommodate females with families,” said Ono.
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