Our Sustainable History and Value Creation Model
The Roots of Management Philosophy
Our Founder, Chubei Itoh, and “Sampo-yoshi”
The foundation of ITOCHU Corporation traces back to 1858, the year in which Chubei Itoh set out from Toyosato Village, in Shiga Prefecture, to Nagasaki as a traveling linen merchant.
Chubei Itoh’s business was based on the spirit of “Sampo-yoshi” (Japanese for “good for all three sides”: good for the seller, good for the buyer, and good for society), the management philosophy of merchants of Ohmi, his home province. The philosophy originated in the shogunate era, when the Ohmi merchants were permitted to do business in the regions they visited because they focused not only on good for the seller and good for the buyer, but also on contributing to the economy of these regions, or good for society. This can be said to form the roots of modern sustainability, which requires corporations to conduct business that balances the interests of multiple stakeholders. That spirit is evident in Chubei Itoh’s personal motto, “Trade is a compassionate business. It is noble when it accords with the spirit of Buddha by profiting those who sell and those who buy and supplying the needs of society.”
The Roots of a Management Philosophy Inherited from Our Founding
Our founder, Chubei Itoh, established a “store law” in 1872, and adopted a meeting system. The store law was a set of house rules covering what today could be called the corporate mission, guideline of conduct, human resources system, and employment regulations, which subsequently became the philosophical foundation of ITOCHU Corporation’s management. Emphasizing communication with employees, Chubei Itoh chaired meetings himself. Moreover, he incorporated a series of what were at the time groundbreaking management systems, including the codification of a system sharing of profit by three parties,* and western bookkeeping methods. Those initiatives built the foundations of mutual trust between the store owner and the employees. Since that era, we have undertaken sustainable corporate management.
- Sharing of profit by three parties: In an era where the feudal influence remained strong, this was an extremely progressive philosophy of sharing profits with employees. The store's net profit was divided among three parties: the store owner, the store's reserve fund, and store employees.
More than 160 Years of History and Sustainability
Why have we been able to keep developing for such a long period of time? We believe that it is because we have put into practice the spirit of “Sampo-yoshi” for over 160 years, which is the root of sustainability. At the same time, as the business environment has changed with the times, we have established a corporate culture that anticipates changes and turns them into opportunities.
Since its founding, ITOCHU Corporation has consistently thrived despite the turmoil it has faced in different eras, including two world wars and times of economic volatility. Starting as a trading company mainly handling textiles, our influence has expanded as we have shifted the composition of the products we handle and our business areas, spanning from upstream to downstream, and from raw materials to retail. In so doing, ITOCHU Corporation has continued to grow, evolving with the times into a general trading company, and from there into a globally integrated corporation.
We are convinced that our history has continued for more than 160 years because we have firmly upheld and passed on the spirit of “Sampo-yoshi,” remaining an essential component of society by responding to its evolving expectations across eras.
Sampo-yoshi Capitalism and The Merchant Value Creation Cycle
To achieve a sustainable society, we embrace an approach to a capitalism that serves all stakeholders, or Sampo-yoshi Capitalism. Through our business activities, we will contribute to the achievement of the Sustainable Development Goals (SDGs) in such ways as maintaining the foundations of everyday life and protecting the environment.
Based on the spirit of ITOCHU’s founding spirit and corporate mission “Sampo-yoshi,” we have identified seven key issues (material issues) from Environmental, Social, and Governance (ESG) perspectives, and aim to address social issues through our core business based on our management policy. As a result, we will expand the economic value and environmental and social value of our business activities, thereby enhancing our corporate brand value.
The long-term management policy announced for FYE 2025, “The Brand-new Deal: Profit opportunities are shifting downstream,” calls for continued efforts to enhance our contribution to and engagement with the SDGs through business activities, one of the pillars of the previous medium-term management plan, “Brand-new Deal 2023.” We will actively promote efforts in areas such as business expansion in accordance with a decarbonized society, leading development in the recycling businesses, and sustained growth through strengthening the value chain in order to enhance our contribution to and engagement with the SDGs.
The Merchant Value Creation Cycle
