Human Capital Management

Basic Approach to Human Capital Management

The CITIZEN Group regards its employees as human capital and believes that unlocking their value will lead to sustainable corporate growth and maximize the value we provide to society. Aiming to achieve the Group Human Capital Vision “Have each employee feel a sense of pride at working at CITIZEN as they contribute to the realization of our long-term vision” by 2030, all Group companies work together to implement the Group’s priority policies, with each of them taking the initiative in developing human capital aligned with for their respective management strategy and business environment.

We focus on attracting and developing talent while fostering a work environment where diverse employees can thrive, all with the aim of ensuring a bright future for every employee.

Vision 2030 and Human Capital Strategy

Striving to achieve the Group Human Capital Vision for 2030, we have adopted an approach of promoting Group-wide cooperation in the priority policies of enhancing job satisfaction, developing human capital, and promoting diversity, equity, and inclusion (DEI) toward achievement of the goals set out in the vision.

Human Capital Management Promotion System

We have in place the Group Human Resources Committee, which is chaired by the director in charge of human resources at Citizen Watch Co., Ltd. and placed under the Sustainability Committee, as the key promoter of human capital management. Human resources managers from each of the Group companies in Japan are included in the members of the Group Human Resources Committee, discussing priority issues and sharing the progress of each company’s initiatives. This Committee's decisions are reported as part of the Group's materiality measures to the Board of Directors through the Sustainability Committee, and their implementation is promoted under the supervision of management.

Enhancement of Job Satisfaction

Realization of Sustainable Corporate Growth and Employee Well-being

The CITIZEN Group defines employee well-being as “the state of employees being healthy both physically and mentally, where employees are encouraged and recognized for taking on new challenges, and where they feel a high level of job satisfaction through their positive contribution to the Group’s long-term vision.” In view of 2030, we position employee engagement as a key indicator for our achievement of employee well-being. To create a more comfortable work environment, we leverage engagement survey insights as a key driver for our initiatives to promote dialogue between employees and management, support employees’ career autonomy, and promote health management. Through these initiatives, we will allow each employee to demonstrate their capabilities, thereby achieving sustainable organizational growth and increasing our corporate value.

Toward Increased Employee Engagement

The CITIZEN Group has introduced employee engagement surveys at its five major operating companies to better understand the relationship between employees and their respective companies, focusing on the employees’ sense of ownership and contribution to their work and the organization. The survey results are used to enhance employ well-being by improving their job satisfaction—including increasing the quality of team building and workplace relationships, and fostering a sense of fulfillment in their work—thereby facilitating dialogue between employees and management and driving workplace improvements. Furthermore, the methods of analyzing and utilizing the survey results and engagement improvement measures are shared at a Group subcommittee so that different departments can learn from each other and work together to enhance each other’s initiatives, thereby creating multifaceted value. In FY2025, three of the five major operating companies increased their overall survey scores by one point from the previous year. In particular, Citizen Watch Co., Ltd. achieved increases of one point in its score for "personal growth" and of two points in its score for "relationship with the superior," reaching the targets the company had set. This indicates improvements in the priority fields.

[Case Study] CITIZEN FINEDEVICE CO., LTD.’s Roundtable Talks between Executives and Employees

CITIZEN FINEDEVICE CO., LTD. holds roundtable talks and departmental discussion sessions to foster an environment in which each employee reflects on the values of the company and the direction to be taken in their own words, thereby cultivating a mindset that drives us all to work toward our shared goals. These dialogue-based initiatives help improve employee engagement and cultivate a culture of proactively taking on new challenges, thereby strengthening the company’s human capital as a foundation for its sustainable growth.

Promotion of Career Autonomy

The CITIZEN Group promotes career autonomy with the aim of improving employee engagement and connecting employees’ personal growth to corporate growth. To support self-directed career development, each CITIZEN Group company implements various measures tailored to the issues it faces, including career design training, career interviews, an internal side job system, and internal job postings.

[Case Study] Citizen Watch Co., Ltd.’s Overall System for Career Autonomy Support

Since Citizen Watch Co., Ltd. launched career design seminars for applicants from among younger and mid-career employees in FY2021, more than 100 employees have attended the seminars and learned basic concepts concerning career development and applied theories thereof. In FY2025, to permeate the concept of “career autonomy” throughout the company by encouraging employees to reconsider the question as to why career autonomy is necessary, the company held a career lecture for all employees, which was attended by 138 employees.
Citizen Watch Co., Ltd. has also implemented an cross-departmental work program , which allows employees to spend around 20% of their total working hours on internal duties unrelated to their primary job role. The system is aimed at enabling employees to acquire knowledge and skills beyond those used in their regular work and to network with a wider group of colleagues. It has not only provided employees with expanded opportunities for skill development but also brought new, diverse values to existing departments, thereby producing positive results. In FY2025, four departments saw the progress of cross-departmental work projects: CAE (computer-aided engineering)-based analysis in the Research and Development Department; a project at CITIZEN MUSEUM; a project for planning and running internship programs and a project for promotion of career autonomy in the Human Resources Department; and an opportunity for employees to help run the CITIZEN of the Year program organized by the Public Relations Section. Participating employees made a positive impact on these projects by bringing fresh, unconventional perspectives. Together with the existing external side job system, the internal side job system is utilized as a voluntary tool for employees to seek out their desired work experiences.
In FY2025, an “Career Guidebook” section was also opened as part of Citizen Watch Co., Ltd.’s internal portal site as an information platform that encourages employees to consider their careers on their own initiative. The section provides an introduction to various in-house job types and shares the career paths of a number of employees. In addition to performance evaluation feedback, Citizen Watch Co., Ltd. also launched a career interview system, under which each employee should attend at least one interview a year. To allow managers to enhance their capabilities for human capital development, as well as their management skills, the company has in place a “360-degree” feedback system and follow-up training. The company also has its employees periodically submit reports on their qualifications and transfer requests and provides them with training based on a curriculum tailored to their own learning focuses and goals. Citizen Watch Co., Ltd. has therefore established mechanisms for supporting individual career development and enhancing and optimizing the capabilities of human capital throughout the company.

Examples of the themes of internal side job projects from 2021 onward	Number of participants
Planning and developing the content of CITIZEN Timeless City	2
Operating an e-commerce site, analyzing data obtained from it, and providing branding support	1
Fine Tuning Service (FTS) Expansion Planning Team	3
Reviving COSMOSIGN 900	3
CITIZEN MUSEUM’s collaboration with the Tamarokuto Science Center in curating and renewing an exhibition	7
CAE-based simulation	2
Preparing and operating Citizen of the Year	1
Recruitment and career support project	2

Creating a Comfortable Work Environment

Work Style Reform and Diverse Work Practices

Citizen Watch Co., Ltd. has been a pioneer in institutionalizing telework and expanding the scope of application of the flextime system to respond to the diversification of work styles, helping employees enhance their work-life balance, and realizing a work style that is not restricted by location or time. In addition, as part of work style reforms, the regular working day, which used to be 8 hours, has been reduced to 7 hours and 45 minutes. With the aim of improving productivity and creating an environment in which all employees can work with vigor and enthusiasm, the company has launched employee-led operational improvement projects, in which active efforts are made, for example, to introduce systems that contribute to operational improvements and greater efficiency at each workplace.
Meanwhile, Citizen Watch Co., Ltd. not only ensures that each department monitors employee overtime hours but also provides thorough guidance to department heads as needed with the aim of avoiding excessive overtime work and concentration of work from the perspectives of compliance with the Labor Standards Act and employee health management. The company also works closely with the labor union through information exchange and other means to ensure that appropriate working hours are strictly observed.

Employee Benefits

Employee Stock Ownership Program and Other Benefits

The CITIZEN Group offers an employee stock ownership program whereby employees jointly purchase shares in Citizen Watch Co., Ltd. through deduction from their salary on a monthly basis. The program allows them to make continuous installment payments of their own designated investment amount plus incentives given by their company.
In addition, Citizen Watch Co., Ltd. offers full-time employees congratulation and condolence money, long-service awards, and paid refreshment leave and grants according to their years of service. The company also provides all employees with an employee asset-building savings plan and a variety of Group insurance options according to their needs as part of its efforts to provide them with financial education.

Relationship with the Labor Unions

Each CITIZEN Group company regularly negotiates and consults on management policies and working conditions with the labor union as a representative of employees. By fostering an exchange of views that respects each other’s perspectives and then providing opportunities for labor unions to engage in dialogue with company management, we have established stable labor-management relations. As of March 2026, the labor union organization rate at the eight companies affiliated with the CITIZEN Group Trade Union Federation was 62.8%. Overseas Group companies hold talks with labor unions or employee representatives in accordance with the laws and regulations of each country. Going forward, each Group company will hold talks on Group operational mechanisms and systems, as well as how to create optimal working environments, in order to further increase both its corporate value and employee satisfaction.

Human Capital Development

Development of Human Capital Necessary for Corporate Transformation and Growth; Acquisition and Development of Human Capital Necessary for Business Continuity

To stably secure and develop the necessary human resources to support its transformation and sustainable growth, as well as its business continuity, The CITIZEN Group strategically advances human capital development by building a robust talent pipelinethrough close coordination between recruitment, training, and placement. Human capital development starts with recruitment and onboarding and also involves systematically developing talent that can serve as transformation drivers, developing talent suitable for a global company, transferring skills, establishing a Group-wide talent base, and implementing a talent rotation program. Through this entire series of practices, we connect the diverse values, experiences, and skills of our employees to value creation.

Building a Talent Pipeline

The CITIZEN Group identifies strategically important posts and builds a pool of candidates for them to systematically develop talented individuals who can lead management and transformation. By doing so, we aim to ensure that would-be successors to the key posts are always available and ready to lead business growth. This initiative is promoted to build a talent pipeline through a consistent process of developing candidates for a range of posts—from senior managers to succession candidates—under the Human Capital Committee, which comprises members from the management of each Group company. In FY2025, we provided selected employees with a six-month training program to develop candidates to become the next department heads and business division senior general managers. We also expanded the scope of trainees in Group Transformation Promotion Training to include younger and mid-career employees, thereby initiating the early development of next-generation leaders.

Group Talent Rotation Program

The CITIZEN Group also devotes efforts to developing next-generation leaders who will be responsible for the future of the Group. As part of these efforts, we have been implementing a talent rotation program in which participants move beyond the boundaries of individual companies across the Group. The participants are expected to deepen their understanding of the business environment of each Group company, expand their network from their own company to the entire Group, and become a growth driver for the entire Group in the future.

Standardization of Talent Management and Skills Management Systems

To implement the abovementioned human capital strategies, we have introduced Group-wide talent management and skills management systems, whereby we promote the visualization and utilization of human capital information. We are making Group-wide efforts to ensure that strategic posts are always filled, monitor the progress of talent development, assign suitable talent to appropriate posts, and develop talented individuals who can drive transformation, thereby strengthening the foundation of human capital management at each Group company and in the entire Group. We have introduced a Group-wide skills management system with the aim of gaining an accurate skill-based picture of our human capital, ensuring that skills are steadily transferred, and in the future, making strategic investments in human capital by utilizing our skills database that will be expanded to encompass the entire Group.

[Case Study] Citizen Watch Co., Ltd.’s Training System

Citizen Watch Co., Ltd. aims to develop professional talent at an early stage through a dual approach of company-led career development programs and each employee’s career autonomy efforts, thereby achieving the growth of each employee as well as the company. To enable autonomous career development, the company offers career seminars to interested employees. The company has been working to expand its voluntary optional training program, in which applicants can choose the courses they need from a system of rank- and theme-specific training courses. In FY2022, the company introduced new online English conversation training and self-development programs, in which more than 500 employees have participated thus far. Citizen Watch Co., Ltd. therefore works to improve employees’ English communication skills, which are fundamental for success in a global company. The company has created an environment in which employees who are eager to learn can do so at any time, fostering a positive attitude toward continuous learning.

Rank-specific training

Training for new employees, newly appointed senior position personnel, newly appointed management staff, etc.

Purpose- and theme-specific training

Voluntary training, online English conversation training, career seminars, training for employees in childcare, training prior to overseas assignment, etc.

Self-development

Self-development e-learning (through Schoo and GLOBIS’s "Learn as Much as You Want" program), Watch School, etc.

• * A business license award system is available to honor those who have acquired company-designated qualifications.

• * Conditions for traineeship vary depending on the training content, such as mandatory participation, supervisor recommendation, or personal application.

Acquisition of Human Capital

Recruitment Activities

The CITIZEN Group companies hire graduates from a medium- to long-term perspective, as well as mid-career recruits as immediate assets. At Citizen Watch Co., Ltd., approximately 30% of management positions are filled by mid-career hires. The company aims to continue to hire mid-career workers to accelerate its business development and maintain the current proportion of mid-career hires in management positions. We believe that mid-career hires can bring with them a wealth of knowledge and skills from diverse industries, as well as vitality and diverse values, to the CITIZEN Group as a whole. At most CITIZEN Group companies, mid-career hires account for 30% or more of new hires. In FY2025, we enhanced our onboarding program to stimulate communication between mid-career hires and allow them to better demonstrate their capabilities as immediate assets. Just as in the previous fiscal year, Citizen Watch Co., Ltd. held networking events among mid-career hires and roundtable talks between them and the president to increase their awareness of The CITIZEN Group’s corporate philosophy and boost their engagement as employees.

We have also launched a system to promote the transition of suitably motivated and skilled contract employees to permanent employees. In hiring them as permanent employees, we value individual ability, aptitude, and motivation and always endeavor to achieve a diverse and equal-opportunity workplace.

Mechanisms for Opening Up Employment Opportunities

To minimize the impact of students’ job-hunting activities on their academic activities, each CITIZEN Group company sends staff to multiple universities to hold company information sessions. In FY2025, we enhanced and expanded our new-graduate recruitment events: hybrid sessions combining in-person and online formats, five-day in-person internships, and company awareness seminars. We also posted videos of company introduction seminars on the internet, conducted online job interviews, and included Japanese students studying abroad in the scope of our recruitment. To ensure that students are not disadvantaged due to their area of residence or academic circumstances, we strive to provide open employment opportunities to a larger number of students.

Initiatives to Ensure Diversity

From among mid-career personnel in their late 20s to early 30s, Citizen Watch Co., Ltd. appoints those who have gained experience through overseas assignments—where they have experienced diversity firsthand—to be department heads at the headquarters or to be responsible for overseas sites. By doing so, the company aims to ensure the diversity of the entire organization. The company offers assignments and opportunities to employees regardless of gender, nationality, or whether they are new graduates or mid-career hires. For example, we consistently appoint female employees to overseas posts and enable mid-career hires to play an important role as expatriates or overseas site management staff shortly after they join the company.

Internal Job Posting System, Enabling Appointments That Leverage Each Employee’s Motivation and Skills

To facilitate organization building that makes the most of each employee’s aspirations to achieve career development and take on challenges, we operate an internal job posting system in which job postings are offered twice a year. In assigning employees to job openings posted by each department, we place high priority on their autonomous intentions, thereby not only creating an environment where highly motivated employees can fully demonstrate their capabilities but also facilitating organizational revitalization and interdepartmental talent mobility. Through this initiative, we aim to promote both the growth of employees and the enhancement of organizational prowess, thereby achieving sustainable business growth.

Diverse Career Paths

An example of our initiatives to provide employees with a wide choice of career paths is Citizen Watch Co., Ltd.’s fellow system, introduced in FY2021. Under the system, employees with advanced expertise and outstanding professional achievements are granted compensation based on their expected roles and allowed to continue to work under the same employment conditions even after reaching the age of 60. The company therefore appropriately evaluates employees according to their achievements and strengthens the development of their successors with the aim of enhancing its own corporate value.