The future that Pacific Consultants Group aims for

INDEX

• The numerous social challenges and our role
• First, we ourselves must have the courage to change.
• Not limited to being a construction consultant
• The reason Pacific Consultants Group is able to be so mindful of the local area is because they understand the area.

The numerous social challenges and our role

--The Pacific Consultants Group has finally taken a new step forward. What is the background behind this?

OMOTO: As I mentioned when establishment the holding company in January 2026, we are currently in the midst of unprecedented change. The future of the Ukraine War and the situation in the Middle East is uncertain, and the frequency and severity of disasters due to climate change are accelerating. In Japan, the way it rains has also changed dramatically, and this year, record-breaking heavy rains have occurred in various parts of the country. One example is the Chiba heavy rains in August 2026, where more than three times the average rainfall for a month in August was recorded in just half a day, causing widespread inland flooding. According to the Cabinet Office, 13 people died, and more than 2,200 houses were flooded up to floor level. What is noteworthy is that much of the flood damage is said to have occurred outside the "flood-prone areas" on hazard maps. To protect the safety, peaceful daily lives, and lives of people in these areas, we have entered an era where the conventional methods of development, maintenance, and damage assessment in separate sectors such as rivers, roads, and sewage systems are no longer sufficient.

The situation is similar overseas. Nepal has suffered a devastating mudslide disaster caused by glacial collapse, and many countries are threatened by the expansion of flooded areas due to rising sea levels. Until now, infrastructure development projects funded by yen loans have mainly been carried out in Southeast Asia, but such needs are shrinking. On the other hand, the challenges faced by countries and regions are also changing, such as how to maintain and renew infrastructure, planning for larger-scale coastal protection and urban relocation as climate change adaptation measures, and human resource development through education.

—So, it's becoming difficult to implement effective initiatives from the perspective of a construction consultant, both domestically and internationally?

OMOTO: If we cling to the same old ways, we won't be able to address the increasingly diverse and complex social challenges. Up until now, as construction consultants, our main services have been conducting surveys, planning, and designing infrastructure development in accordance with existing concepts, and even managing some of the construction. We haven't been very involved in the initial conceptual stage, or in maintenance, management, or operation of facilities after completion. However, with the advancement of technological innovations, including AI, we believe that the areas we play a role in will change significantly. That's why it's crucial to provide greater value in the upstream planning and conceptualization stages, and in the downstream operation and management stages.

We have the strength of having accumulated advanced technical capabilities in various fields over 75 years as a construction consultant, and of bringing together outstanding engineers. With this as our core, and by leveraging the overall strength of the group to expand into both the upstream and downstream sides, we can provide the value that is required in today's era. What we need now is to formulate a strategy and execute it. To that end, we believe it is important that the holding company that oversees Pacific Consultants and other group companies sets the direction for the entire group, rather than Pacific Consultants as a separate operating company, and aims to improve the value provided by the group by optimally allocating management resources.

First, we ourselves must have the courage to change.

—From establishment of the holding company in January 2026 to establishment of this international operating company and the group restructuring, it's only been 10 months. That's fast.

OMOTO: The pace of change in society and the market is extremely fast, and we must respond quickly. As a group, we have set forth two missions: to realize a prosperous life where no one is threatened and there is no inequality, and to protect the beautiful environment of our planet and pass it on to future generations. In order to fulfill this mission, we need to continuously create effective systems that are in line with the changing times. What is needed is not to be afraid of change, but for us to change ourselves first. And I believe that we must have the courage to step into a new world. As part of this, we have made a major restructuring of the group's organizational structure.

We believe the timing for establishment Pacific Padeco International, our new international operating company, is not premature. It will be approximately three years since we welcomed PADECO into our group in December 2023. That being said, it's not easy for companies with different corporate cultures to unite. We expect the new company to cultivate a new corporate culture over time and achieve sustainable growth.

Not limited to being a construction consultant

—What will you achieve first as Pacific Consultants Group?

OMOTO: First and foremost, our goal is to make Pacific Padeco International fully independent. We want it to be a company that rivals Pacific Consultants, which handles our domestic business, in terms of both business scale and profitability. Another goal is to expand our private sector business. Last year, we established a Solutions Business Division at Pacific Consultants, and we are strengthening our efforts in private sector business while leveraging our existing connections. Within this, we aim to strengthen relationships with our clients and create a new customer-centric business where we provide solutions after thoroughly understanding their management challenges. We are already actively participating in new businesses that no one else has tackled yet, such as providing various solutions utilizing DX and large-scale projects in the next-generation energy sector. Furthermore, in order for us to continue to be needed by society, we believe it is necessary to evolve into a corporate group that is not confined to the framework of a construction consultant. Among our existing group companies, there are already companies such as Pacific Power in the energy sector that are developing businesses that do not fit within the framework of a construction consultant. These companies have been placed under the direct umbrella of the holding company as part of the group restructuring. We want you to pursue a different kind of growth than Pacific Consultants and play a key role in realizing the holding company's strategy.

--I see. So, under the group's overall strategy, Pacific Consultants, Pacific PADECO, and the other operating company will move forward.

OMOTO: That's right. For that reason, the group strategy as a holding company, which is the highest-level plan, is extremely important.

The reason Pacific Consultants Group is able to be so mindful of the local area is because they understand the area.

—Within the new group structure, I think there are high expectations for Pacific PADECO, the new international operating company.

OMOTO: Modern social challenges are becoming more diverse, complex, and borderless, and for some, the distinction between domestic and international issues is becoming meaningless. In particular, responding to climate change cannot be completed solely within a domestic context. Overseas, there are calls for various forms of support that go beyond the traditional framework of infrastructure development, including not only training personnel to maintain infrastructure after its construction, but also support for energy transitions toward achieving carbon neutrality, urban protection and relocation due to rapid population growth and sea-level rise, redevelopment utilizing TOD (Transition-Oriented Development) associated with relocation, and human resource development through the enhancement of primary education. In particular, regarding education, an increasing number of countries want to introduce Japanese curricula and school management know-how, and Pacific Padeco International has extensive experience in this area. We believe that there is no corporate group among traditional construction consultants that can meet these diverse needs, and we think there is much we can contribute through our overseas business.

—What kind of group do you want to become in the future?

OMOTO: With the holding company structure now fully operational, I believe that each company in the group has found an environment where they can achieve their own growth from a new perspective. Up until now, our thinking tended to be biased towards what Pacific Consultants Consultants, a construction consulting firm, thinks about, and how we should behave as a member of that group. But from now on, we can think more flexibly about what kind of business we should develop and grow in line with the group's statement and the holding company's strategy. Conversely, the holding company may also ask certain companies to take on certain roles. In any case, I believe that by having each company in the group promote their business and grow in line with the holding company's strategy, and by bringing it all together as a group, we can provide unprecedented value.

As one example, our approach of considering business in terms of "area" is a unique idea of ours. While typical operating company may be aware of areas in the sense of their own business's market area, they don't typically consider value enhancement from a comprehensive perspective, encompassing the livability of an entire area with various stakeholders, as well as considerations for disaster prevention and mitigation. I believe that Pacific Consultants Group is capable of doing just that. With this perspective in mind, I hope that various ideas will emerge from each company within the group regarding what we can do and what we should do. I expect all group employees to consider their own roles and take on challenges for the future of the group. I am confident that this will lead to the growth of the group and the realization of our mission.