KPMG Japan Issues "Survey on Corporate Reporting in Japan 2025"

KPMG Japan (Chiyoda-ku, Tokyo; Co-Chairmen: Hiroyuki Yamada, Masahiko Chino) has issued the "Survey on Corporate Reporting in Japan 2025," focusing on trends in various reports, including integrated reports.

This 12th edition of the survey sets "integrated thinking" as its key theme, focusing on "what constitutes a report that reflects integrated thinking," and has updated its survey items based on the IFRS Foundation's "Principles of Integrated Thinking." It also examined matters related to climate change, which are expected to continue to be enhanced, and the visualization of social impact, which has been increasingly noted in integrated reports in recent years, while also conducting a basic survey of integrated reports.

For the core survey on integrated thinking, the target was integrated reports issued by TOPIX100*1 constituent companies. For other topic surveys, the targets were integrated reports, annual securities reports, sustainability reports, and sustainability-related pages on corporate websites (collectively referred to as "sustainability reports") issued by Nikkei 225*2 constituent companies. The basic survey on integrated reports targeted reports issued by 1,225 domestic organizations that publish "self-declared integrated reports" between January and December 2025.

Key Survey Findings

1. Purpose: From "Stating" to "Leaders Articulating and Connecting to Value Creation"

While 94% of companies state their purpose, only 59% of executives actively serve as "narrators" of their purpose, promoting understanding of their value creation story (Figure 1). It is crucial for executives to articulate in their own words how the "reason for existence" embedded in the abstract concept of purpose is reflected in concrete initiatives presented as value creation stories and management strategies, and what their intentions and aspirations are, to connect purpose to value creation. Figure 1: Is the reason for existence (interpretation) as conceived by management clearly stated? Source: "Survey on Corporate Reporting in Japan 2025 - Aiming for Corporate Reporting that Leads to Sustainable Value Enhancement" KPMG Japan

2. While Risks are Discussed, Explanation of Business Impact on External Environment is Limited

Only 19% of companies described both positive and negative impacts of their business on the external environment, with 81% not mentioning negative impacts (Figure 2). In contrast, 79% of companies explained significant risks and 68% explained significant opportunities, revealing a "discrepancy" in the disclosure status between significant risks/opportunities and the impact on the external environment (Figure 3).

Figure 2: Does the company address the impact of its business (business model, operations, strategy) on the external environment (from both positive and negative perspectives)? Source: "Survey on Corporate Reporting in Japan 2025 - Aiming for Corporate Reporting that Leads to Sustainable Value Enhancement" KPMG Japan

Figure 3: Are significant risks identified? Source: "Survey on Corporate Reporting in Japan 2025 - Aiming for Corporate Reporting that Leads to Sustainable Value Enhancement" KPMG Japan Figure 3: Are significant opportunities identified? Source: "Survey on Corporate Reporting in Japan 2025 - Aiming for Corporate Reporting that Leads to Sustainable Value Enhancement" KPMG Japan

3. Majority of Companies View Capital as a Source of Competitive Advantage and Detail Utilization Policies

79% of companies reported on their capital, with 64% of those mentioning non-financial capital in addition to financial capital (Figure 4). Furthermore, 69% of companies clearly stated their capital utilization policies to enhance competitive advantage, suggesting that many companies position "capital" as a crucial prerequisite when discussing competitive advantage (Figure 5).

Figure 4: Is the necessary capital (source of competitive advantage) identified? Source: "Survey on Corporate Reporting in Japan 2025 - Aiming for Corporate Reporting that Leads to Sustainable Value Enhancement" KPMG Japan Figure 5: Are capital utilization policies presented as a prerequisite for enhancing competitive advantage? Source: "Survey on Corporate Reporting in Japan 2025 - Aiming for Corporate Reporting that Leads to Sustainable Value Enhancement" KPMG Japan

KPMG's Recommendations

This survey targeted integrated reports of TOPIX100 constituent companies, using the IFRS Foundation's "Principles of Integrated Thinking" as a starting point to assess the degree to which integrated thinking for value creation is embedded in organizational reporting. The results showed that while necessary elements were present in many companies, there were differences in the depth and persuasiveness of the descriptions. Highly persuasive reports may indicate a deeper penetration of integrated thinking. Conveying that results are based on sustainable and reproducible management mechanisms, rather than merely listing achievements, leads to stronger accountability. Therefore, this time, we present four characteristics of persuasive reports that reflect integrated thinking:

(1) "Uniqueness" and its "Specificity" inherent to the company (2) "Consistency" of the story centered on long-term strategy (3) "Integrity" evident in the management message (4) "Evidence" underlying the facts

Survey Overview

Survey Period January - December 2025 Target Companies ・Core Survey: Integrated reports of 100 TOPIX100 constituent companies ・Topic Survey: Integrated reports, descriptive information in annual securities reports, and sustainability reports of 225 Nikkei 225 constituent companies ・Basic Survey on Integrated Reports: Reports issued by 1,225 domestic organizations publishing "self-declared integrated reports" Survey Method The core survey was conducted by establishing judgment criteria among all survey members, after which one person per company thoroughly read and verified the integrated report. Cooperation Corporate Value Reporting Lab (Provided "List of Self-Declared Integrated Report Issuing Companies, 2025 Edition")

*1TOPIX is a registered trademark or trademark of JPX Market Innovation & Research, Inc. *2Nikkei Stock Average (Nikkei 225) is a registered trademark or trademark of Nikkei Inc.

Related Links Survey on Corporate Reporting in Japan 2025 Past Surveys on Corporate Reporting in Japan

About KPMG Japan

KPMG Japan is the collective name for KPMG International's member firms in Japan, comprising 10 professional firms across three fields: audit, tax, and advisory. They leverage the knowledge and skills of specialists in each field, collaborating and utilizing KPMG's global network to provide valuable services for clients' management challenges. Member firms in Japan are as follows: Azsa Audit Corporation, KPMG Tax Corporation, KPMG Advisory Holdings Co., Ltd., KPMG Consulting Co., Ltd., KPMG FAS Co., Ltd., KPMG Forensic & Risk Advisory Co., Ltd., KPMG Azsa Sustainability Co., Ltd., KPMG Healthcare Japan Co., Ltd., KPMG Social Insurance and Labor Consultant Corporation, KPMG Ignition Tokyo Co., Ltd.