Why Suntory’s CEO is still investing in a sobered-up spirits market

Nobu Torii, appointed CEO of Suntory in September, continues to invest in a sobering spirits market. Torii, the younger family member, assumed the role of president after Takeshi Niinami, Suntory's first non-family CEO, resigned amid a police search for illegal supplements. Despite Niinami's denial of wrongdoing, the board deemed his resignation necessary, solidifying Torii's leadership.

Torii emphasizes his commitment to Suntory's long-standing corporate culture and his intention to navigate the increasingly challenging spirits market. The company, which generated about $22 billion in revenue, experienced a decline in spirits consumption, particularly in its largest markets, as demand peaked during the pandemic.

Torii's strategy focuses on expanding into new countries and categories while seeking growth opportunities within the core liquor business. He acknowledges that establishing a fine whisky requires a long-term perspective, with a strategy spanning five to ten years. Suntory's private status enables the company to adopt a more patient approach to market strategy, unlike publicly listed competitors such as Diageo and Pernod Ricard, which have seen falling shares.

Torii believes that Suntory's private structure affords the company the flexibility to invest in brands during cyclical downturns, unlike some publicly traded peers who focus on cost-cutting. He also notes that Suntory's strong financial position has been bolstered by the company's relatively low interest rates. While the company is not actively seeking acquisitions, Torii acknowledges that the family's controlling stake would allow it to block any unwanted transactions.