BCG Releases TSR Ranking of Major Japanese Companies for the Five Years Ending 2025

Management consulting firm Boston Consulting Group (BCG) has released a report, 'Leveraging "TSR Thinking" for Value Creation: Japan Value Creators Ranking 2026,' analyzing value creation by Japanese companies over the past five years.

The 5-year average TSR for Japanese firms (TOPIX) from 2021 to 2025 reached +16%, surpassing the U.S. (+14%), Europe (+12%), and emerging markets (+7%), marking the highest level among regions surveyed. The primary driver was the increase in valuation multiples, which turned positive for Japan—the only region among those surveyed to do so over the past five years.

In sector-specific TSR, 'Insurance' ranked first for the second consecutive year. Among large-cap firms with market capitalizations over 1 trillion yen, Fujikura maintained the top spot. Companies that improved their rankings are actively advancing reforms that consider the cost of capital, such as streamlining non-core businesses and refreshing shareholder return policies.

However, the fundamental 'earning power' of Japanese firms still trails behind Western counterparts. The median ROE in 2025 was only 8.9% in Japan, compared to 13.5% in the U.S. and 13.6% in Europe. The report provides a specific approach to embedding 'TSR Thinking' into management, utilizing TSR not just as a result metric but as an 'lens for decision-making.'