Iwao Fudoh is a central figure in the narrative as the father of the protagonist, Riki Fudoh, and a high-ranking member of the Nioh yakuza organization. His role is that of the primary antagonist and the ultimate target of his son's elaborate plan for revenge. The foundation of the entire story rests on Iwao's actions before the main timeline begins, when he was ordered to settle a dispute between the Nioh organization and a powerful rival syndicate from Osaka known as the Yasha-Gumi. To resolve this conflict, Iwao was compelled to commit a horrific act: the murder of his own oldest son, who was also his first lieutenant, as a form of compensation. This event, which the young Riki secretly witnessed, serves as the catalyst for the film's events.

Iwao Fudoh embodies the cold, pragmatic, and brutal code of the traditional yakuza underworld where family loyalty is secondary to the demands of organizational politics and power. His decision to kill his own child demonstrates a ruthless adherence to this code, prioritizing the clan's survival and his own standing within it over any paternal bond. This act defines his character as a formidable and emotionally detached figure, whose authority and past sins his son is determined to dismantle.

Throughout the story, Iwao functions as the representation of the established criminal order that Riki seeks to overthrow. He is not merely a target but an active participant in the ensuing conflict. As Riki and his gang of underage assassins begin a campaign of gruesome killings targeting the top figures of the Kyushu underworld, the organization takes notice. Iwao, suspecting his surviving son is behind the chaos, responds by deploying an agent, a former South Korean Army officer named Gon, to infiltrate Riki's high school as a gym teacher with orders to eliminate him. This action reveals that Iwao sees his son not with remorse but as a threat to be neutralized, cementing the deadly, dysfunctional nature of their relationship. The elder Fudoh’s key relationships are defined by this dynamic of power and betrayal: he is the feared father to Riki, a loyal subordinate to the Nioh clan, and a rival to the Yasha-Gumi's boss, Daigen Nohma.

The character's development, while limited, culminates in a direct confrontation with his son. In a final attempt to extinguish the rebellion, Iwao attacks Riki in a manner that mirrors the execution of his older brother years before. This scene brings the family's tragic dynamic full circle, as the father employs the same method of killing he used on one son against the other. However, Riki is prepared for this moment, and in the ensuing struggle, he succeeds in killing Iwao, finally achieving his long-sought revenge. This outcome signifies the son's ultimate rejection and destruction of the father's brutal legacy. While Iwao is a high-ranking yakuza, the search results do not provide specific details about any unique fighting skills or notable abilities he possesses, focusing instead on his role as an authoritative figure who orders others to do his bidding and whose final confrontation is a more personal, dramatic reckoning rather than a display of specialized combat prowess.