★ This article consists of two parts: an “Overview” and an “Analysis.” The Overview provides a quick summary of the results. For those interested in how the analysis was conducted or seeking more detail, please refer to the subsequent Analysis section.
[Overview]
This analysis reveals that companies with more advanced animal welfare initiatives and information disclosure tend to have higher corporate value.
An analysis of 81 listed companies evaluated in FARMWISE Impact 2026 confirmed a statistically significant positive rank correlation between animal welfare (AW) scores and PBR.
FARMWISE Impact evaluates animal welfare initiatives based on publicly disclosed corporate information.In other words, this study highlights the relationship between the “disclosure level” of animal welfare and corporate value.
The PBR (Price-to-Book Ratio) used here is an indicator of how highly investors value a company. It can be considered synonymous with “corporate value.”
However, when the FARMWISE Impact evaluation was divided into four areas, no significant correlation with PBR was found for “General Policy” alone.
Correlations were observed in “Procurement Policy & Practice,” “Transition from Animal-Derived Materials,” and “Dialogue.”
Among these, “Dialogue” showed the strongest correlation.
In fact, companies engaging in dialogue clearly tended to receive higher evaluations from investors. Comparing PBR, companies with dialogue had a median of 1.46, while those without had 0.88. The correlation with corporate value was stronger for visible actions than for simply stating a policy.
The number of companies in Japan adopting policies to “consider animal welfare” is gradually increasing. However, which species are covered and what standards are set? To what extent has procurement actually changed? What is the current progress toward goals? If these actions are not visible from the outside, the company’s efforts cannot be evaluated. This proves what the Animal Rights Center has long advocated: that public disclosure and transparency are vital.
This is not just about consumers. The information disclosed by a company serves as material for investors to evaluate that company. Just as companies have begun disclosing information on climate change, human rights, and biodiversity, they are now required to understand their impact on animals, make improvements, and demonstrate that progress to the outside world.
Among these 81 companies, a correlation was actually found between such “visible animal welfare” and investor evaluation.
Furthermore, this correlation appeared not just where policies were stated, but where corporate actions were visible, such as in procurement, practice, the transition from animal-derived materials, and dialogue.
So, what does this correlation mean?
Companies proactive in animal welfare initiatives and disclosure may possess other characteristics, such as high profitability, large scale, or high growth potential. Such companies might have a high PBR regardless of animal welfare. In other words, at this stage, the existence of a correlation is not strictly equivalent to saying that animal welfare initiatives are what increase corporate value.
What we have confirmed is a statistical relationship between animal welfare disclosure and PBR. However, this is incredibly groundbreaking. Simply put, we have seen a glimpse of how public disclosure alone can have a positive impact on corporate value in the market. This is a phenomenon with few precedents globally. Whether this relationship is due solely to animal welfare or can be explained by profitability, company size, growth, financial status, or industry remains to be seen. To isolate these factors, we will proceed with an analysis that controls for these non-AW variables. We will report the results on our official website once they are available.
[Analysis]
★ The following Analysis section presents statistical analysis using data from 81 companies and utilizes technical terminology. It also introduces previous research that serves as a reference for considering future analytical methods.
Statistical Analysis of FARMWISE Impact 2026 and PBR
Subject of Analysis
The analysis included 81 companies from those evaluated in FARMWISE Impact 2026 for which listed entity correspondence could be confirmed and PBR data could be obtained.
FARMWISE Impact is, in principle, based on publicly disclosed information. In this analysis, the FARMWISE score was treated not as the actual degree of internal AW implementation, but as an indicator of externally observable animal welfare initiatives and information disclosure.
Please refer to the FARMWISE Impact 2026 public page for the list of evaluated companies and their respective results.
FARMWISE Total Score and PBR
We examined the Pearson correlation, OLS simple regression, Spearman rank correlation, and Kendall rank correlation for the FARMWISE total score and PBR.
| Analysis Method | Statistic | p-value |
|---|---|---|
| Pearson Correlation | r = 0.139 | 0.215 |
| OLS Simple Regression | β = +0.0334 | 0.215 |
| Spearman Rank Correlation | ρ = +0.307 | 0.0053 |
| Kendall Rank Correlation | τ = +0.220 | 0.0053 |
No statistically significant relationship was confirmed at the 5% level for Pearson correlation and OLS simple regression. Both Spearman and Kendall rank correlations showed a significant positive correlation at the 1% level.
Preliminary Analysis of 12 Companies
Initially, a simple regression analysis of the FARMWISE total score and PBR was conducted for the 12 companies for which data had been obtained.
| Subject of Analysis | OLS Coefficient | p-value |
|---|---|---|
| 12 Companies | -0.0469 | 0.617 |
No statistically significant relationship was confirmed for the 12 companies.
Subsequently, when the analysis was expanded to 81 companies, a significant positive correlation was confirmed using Spearman and Kendall rank correlations.
Sensitivity Analysis
To ensure that the results were not driven by a few companies with high PBR or high AW scores, we conducted a sensitivity analysis by excluding major companies.
The positive rank correlation was generally maintained even when excluding companies such as Nippon Ham, Ito-Yokado (Aeon), Seven i Holdings, Meiji Holdings, Toridoll Holdings, Starzen, and Marudai Food individually. Furthermore, we simultaneously excluded five companies: Nippon Ham, Meiji Holdings, Aeon, Seven i Holdings, and Toridoll Holdings.
| Analysis | Spearman ρ | p-value |
|---|---|---|
| Excluding 5 Major Companies | 0.282 | 0.0135 |
Even when the five companies were excluded simultaneously, a significant positive rank correlation was maintained at the 5% level.
Analysis by FARMWISE Evaluation Area
The evaluation was divided into four areas according to the official FARMWISE structure, and the Spearman rank correlation with PBR was confirmed for each.
| FARMWISE Evaluation Area | Spearman ρ | p-value |
|---|---|---|
| General Policy (Q1–Q5) | 0.197 | 0.0776 |
| Procurement Policy Practice (Q6–Q13) | 0.238 | 0.0325 |
| Transition from Animal-Derived Materials (Q14–Q15) | 0.225 | 0.0437 |
| Dialogue (Q16) | 0.290 | 0.0086 |
Significant positive rank correlations were confirmed at the 5% level for “Procurement Policy Practice,” “Transition from Animal-Derived Materials,” and “Dialogue.”
“General Policy” was not significant at the 5% level.
“Dialogue” showed the strongest correlation among the four areas and was significant even at the 1% level.
Comparison by Presence of Dialogue
Companies were divided into two groups, “With Dialogue” and “Without Dialogue,” and their PBRs were compared.
| Number of Companies | Median PBR | |
|---|---|---|
| With Dialogue | 47 companies | 1.46x |
| Without Dialogue | 34 companies | 0.88x |
The Mann–Whitney U test resulted in p = 0.0096, confirming a statistically significant difference between the two groups.
Analysis Considering Factors Other Than AW
The current study confirmed a univariate relationship between FARMWISE Impact scores and PBR. PBR is also influenced by factors other than AW, such as profitability, company size, financial structure, growth potential, and industry. Therefore, the next stage will involve multivariate analysis using these as control variables.
The assumed basic model is as follows:
PBR = FARMWISE + ROA + ln(Total Assets) + Debt Ratio + Sales Growth Rate + Industry Dummy + ε
| Variable | Content |
|---|---|
| PBR | Dependent Variable |
| FARMWISE | AW Initiatives Disclosure |
| ROA | Profitability |
| ln(Total Assets) | Company Size |
| Debt Ratio | Financial Structure |
| Sales Growth Rate | Growth Potential |
| Industry Dummy | Industry Differences |
This analysis will verify whether the relationship between FARMWISE and PBR is maintained after controlling for corporate characteristics other than AW.
Previous Research Used as Reference for Analytical Methods
Regarding corporate AW information disclosure, Sullivan, Amos van de Weerd (2017) used data from the Business Benchmark on Farm Animal Welfare (BBFAW) to analyze disclosures related to AW policies, management, goals, and performance of major global food companies.
McLaren Appleyard (2020) analyzed AW benchmarks and corporate accountability using BBFAW reports and corporate case study interviews.
Furthermore, in future multivariate analysis, we will refer to previous research that examines the relationship between ESG information disclosure and corporate value, not limited to AW, for control variables and model settings.
Findings of This Analysis
Among the 81 listed companies in FARMWISE Impact 2026, a significant positive rank correlation was confirmed between the total score and PBR (corporate value).
• The positive rank correlation was maintained in sensitivity analyses excluding major companies.
• When the evaluation was divided into four areas, no significant correlation was found for “General Policy,” while significant positive rank correlations were confirmed for “Procurement Policy Practice,” “Transition from Animal-Derived Materials,” and “Dialogue.”
• “Dialogue” showed the strongest correlation among the four areas. Additionally, the difference in PBR between companies with and without dialogue was statistically significant according to the Mann–Whitney U test.
What has been confirmed here is a correlation between AW initiatives/disclosure and PBR. It does not demonstrate causality. We will further verify this relationship through multivariate analysis controlling for corporate characteristics other than AW.
References
Sullivan, R., Amos, N., van de Weerd, H. A. (2017). Corporate reporting on farm animal welfare: An evaluation of global food companies’ discourse and disclosures on farm animal welfare. Animals, 7(3), 17
McLaren, S., Appleyard, T. (2020). Improving accountability for farm animal welfare: The performative role of a benchmark. Accounting, Auditing Accountability Journal, 33(1), 32–56
