Climate Change Data

Environmental Metrics

ESG Focus Areas

• Decarbonization
• Digital Transformation (DX)
• Sustainable Business Growth

Climate Goals & Targets

Environmental Challenges

• Cost increase due to potential carbon tax introduction.
• Negative consumer perception of companies not actively pursuing carbon neutrality.
• Risk of negative ESG assessment and divestment by investors.

Mitigation Strategies

• Promoting "Decarbonization DX" – integrating digital transformation with decarbonization efforts.
• Supporting companies in achieving decarbonization through DX.
• Establishing the "Zero Carbon Marketing Research Association" to study and implement best practices.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental changes due to global warming and climate change
• Failure of the pension and medical systems due to population decline, the disappearance of local governments due to the local decline, and financial bankruptcy

Social Achievements

• Continuous recruitment of graduates from art universities, technical colleges, four-year universities, and graduate schools (484 new graduates in April 2022)

Climate Goals & Targets

Environmental Challenges

• Shortage of creative personnel versed in internet and digital technology
• Less than 50% of Japanese enterprises reported successful digital transformation (DX) initiatives
• Increase in labor costs for new graduates

Mitigation Strategies

• Continuous recruitment and training of digital creators
• Investment in mid-career recruitment, human resource development, and sales and marketing
• Promoting company-wide work-from-home and remote work environments

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Sustainable Web Design
• Decarbonization DX

Environmental Achievements

• Reduced file size of 2022 year-end greeting website to 6MB (from a target of 7.5MB), utilizing SVG animation and optimized font usage.
• Reduced image usage and optimized images on the "Members' Decarbonization DX" page, using vector graphics where appropriate.

Social Achievements

• Improved user experience (UX) through optimized image loading (Lazy Load) and faster page load times.
• Promoted digital inclusion by considering users with limited internet access.

Governance Achievements

• Developed and publicly released a Sustainable Web Design guideline (version 1.0).

Climate Goals & Targets

Environmental Challenges

• High environmental impact of digital technologies, including greenhouse gas emissions from ICT lifecycle, increasing data volume, and e-waste.
• Balancing design aesthetics with environmental considerations (e.g., using web fonts vs. system fonts).

Mitigation Strategies

• Implementing sustainable web design principles (Clean, Efficient, Open, Honest, Regenerative, Resilient).
• Optimizing images (size, format, lazy loading), reducing unnecessary code, optimizing JavaScript, using energy-efficient colors, and optimizing fonts.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Sustainable Web Manifesto

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Human Capital
• CSV (Creating Shared Value)

Environmental Achievements

• Established an internal company "Decarbonization DX Company" in April 2023 to support corporate decarbonization DX.
• Set 100 decarbonization action examples for daily operations and service provision to reduce CO2 emissions.

Social Achievements

• Selected as a "Nadeshiko Brand" in FY2022 for excellence in promoting women's empowerment.
• Established a "Well-being Promotion Committee" to foster a culture of inclusivity and support diverse creative talent.
• Achieved significantly higher than the government's 2025 target of 30% for childcare leave acquisition rate since 2019.
• Increased women's management ratio to 31.8% in 2022.
• Implemented CV1.6 project to increase DC's compensation along with productivity improvement.
• Increased base annual salary by approximately 17% over three years.

Climate Goals & Targets

Environmental Challenges

• Decreased operating rate due to proactive investment in recruitment.
• Increased management expenses due to active sales and recruitment investments.

Mitigation Strategies

• Implemented sales and distribution separation in October 2022, improving the year-on-year growth rate of quarterly value-added sales.
• Aiming for 90% operating rate for 585 new graduates joining in April 2023.
• Strategic expansion of mid-career recruitment to improve the overall human resource portfolio.

Supply Chain Management

Climate-Related Risks & Opportunities

UN Sustainable Development Goals

• Goal 7 (Affordable and Clean Energy)
• Goal 8 (Decent Work and Economic Growth)
• Goal 9 (Industry, Innovation and Infrastructure)
• Goal 10 (Reduced Inequalities)
• Goal 13 (Climate Action)

Members' initiatives contribute to these SDGs through its focus on digital transformation, CSV management, decarbonization, and human capital development.

Awards & Recognition

• Nadeshiko Brand (FY2022)

Environmental Metrics

ESG Focus Areas

• Climate Change
• Digital Transformation (DX)
• Biodiversity
• Circular Economy

Environmental Achievements

• Reduced carbon emissions by 1,011t-CO2 through approximately 1,000 implemented decarbonization actions. This is equivalent to the amount absorbed by approximately 115ha of cedar forest in one year.

Social Achievements

• Launched a forest conservation project, "Members' Forest", in Iwate Prefecture.
• Established a decarbonization DX company and launched new services.
• Established a decarbonization DX research institute and published research findings.
• Actively participated as a full member of the Japan Climate Leaders Partnership (JCLP).

Governance Achievements

• Implemented a company-wide decarbonization action plan ("Decarbonization Action 100") involving various departments and employees.

Climate Goals & Targets

Environmental Challenges

• Lack of opportunities for digital creators to actively engage in decarbonization-specific actions.
• Need to accelerate customer companies' decarbonization DX and business results creation.
• Need to expand the specific reduction effects of the company's decarbonization initiatives.

Mitigation Strategies

• Created and implemented "Decarbonization Action 100", a list of actions for employees to take in their daily work.
• Appointed ambassadors from all departments to share progress, including challenges and achievements.
• Regularly shared progress and knowledge through monthly meetings and internal portals.
• Reflected decarbonization action performance in employee evaluations.

Supply Chain Management

Climate-Related Risks & Opportunities

UN Sustainable Development Goals

• SDG 7 (Affordable and Clean Energy)
• SDG 13 (Climate Action)

Initiatives such as renewable energy use and the "Decarbonization Action 100" contribute to these goals.

Environmental Metrics

ESG Focus Areas

• Climate change
• Population decline

Social Achievements

• Maintained low employee turnover rate (around 9%)
• High employee engagement scores

Climate Goals & Targets

Environmental Challenges

• Significant decline in profitability due to large upfront investments in recruitment exceeding growth potential.
• Slow growth rate of website operation division.
• Lack of cross-selling between specialized companies and main division.
• Declining operating rate, particularly among first and second-year new graduates.
• Imbalance between hiring and sales growth.

Mitigation Strategies

• Freezing numerical targets of VISION 2030.
• Shifting business positioning from operation and digital business operation to DX field support.
• Curtailing new graduate hiring to -10% of target sales growth rate.
• Optimizing mid-career hiring in specialized companies.
• Reorganizing into four DX businesses to maximize existing customer sales and promote cross-selling.
• Focusing on raising operating rates and shifting to profit-oriented management.
• Developing a decarbonized DX business.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Governance

Environmental Achievements

• Achieved 100% renewable energy for Members group offices and employee's home offices in 2020 (two years ahead of schedule).

Social Achievements

• Women's executive ratio of 31.6% (as of March 31, 2024)
• 46.5% of employees are women (as of March 31, 2024)
• 64.3% of male employees took parental leave (FY2024)
• 66% of managers are mid-career hires (as of March 31, 2024)

Governance Achievements

• Established a Nomination and Compensation Committee composed entirely of outside directors.
• Implemented a performance-based compensation system for directors, incorporating long-term non-financial indicators.

Climate Goals & Targets

Environmental Challenges

• Achieving further reductions in carbon emissions
• Improving the conciseness of board materials

Mitigation Strategies

• Continued efforts to promote climate change initiatives
• Improving the conciseness and clarity of board materials

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Governance

Environmental Achievements

• Continued 100% renewable energy use since 2020
• Establishment of a decarbonization DX business and the goal of fostering 1,000 decarbonization DX personnel in the next 3 years.

Social Achievements

• Selected as a 'Nadeshiko Brand' in fiscal year 2022
• High employee engagement scores maintained
• Focus on improving employee engagement and addressing areas for improvement.

Governance Achievements

• President change and transition to a dual representative system in April 2023
• Women's director ratio of 28.6%
• Full implementation of all principles of the CG Code
• Disclosure of information on initiatives related to the TCFD recommendations

Climate Goals & Targets

Environmental Challenges

• Significant deterioration in profitability despite achieving record-high revenue and added-value sales
• Slow growth in the main Web operation department
• Lower-than-expected cross-selling
• Decreased operating rate due to large-scale investment in human capital
• High non-operating costs for new graduates
• Commodity-like nature of main services and challenges in matching customer needs
• Decreased willingness of customers to expand transactions

Mitigation Strategies

• Shifting from a sales-growth-focused management to a profit-focused management
• Restructuring into four business areas (Production/UIUX, Digital Service Development, Data Utilization Support, Digital Marketing)
• Prioritizing increased operating rate and profit
• Suppression of new graduate recruitment to a level commensurate with added-value sales growth rate
• Optimization of mid-career recruitment
• Strengthening cross-selling within and across the four business areas
• Acquisition of a position supporting customers' DX internalization
• Focus on developing high value-added digital personnel, including PMOs

Supply Chain Management

Climate-Related Risks & Opportunities

Opportunities

• Establishment of decarbonization DX business

Reporting Standards

Frameworks Used: TCFD

Awards & Recognition

• Nadeshiko Brand

Environmental Metrics

ESG Focus Areas

• Climate Change
• Diversity & Inclusion
• Governance
• Human Capital
• CSV (Creating Shared Value)

Environmental Achievements

• Launched "Decarbonization DX Solutions" offering nine solutions to reduce Scope 3 emissions and improve profitability.
• Implemented "Members' Forest" tree planting project in Iwate Prefecture.
• Organized a user meeting with 22 client companies to visit a floating offshore wind power plant.

Social Achievements

• Implemented a new code of conduct to promote autonomous, collaborative organizational capabilities and employee engagement.
• Maintained 55.8% employee stock ownership despite workforce growth.
• Promoted diversity and inclusion initiatives, including increasing the number of female executives.

Governance Achievements

• Appointed 7 women to the board of directors and executive officers, resulting in a 22.6% female representation.

Climate Goals & Targets

Environmental Challenges

• Slower-than-expected establishment of DGT (Digital Growth Team) services and sales strengthening.
• Lower-than-planned operating rate for digital creators (DCs).
• Challenges in integrating EMC and PGT services.

Mitigation Strategies

• Prioritizing profitability improvement by suppressing new graduate recruitment until a 90% operating rate and 10% operating profit margin are achieved.
• Continuing efforts to strengthen services, sales, and training to increase growth rate.
• Focusing on improving account management and establishing sales and manufacturing separation for new customer acquisition.

Supply Chain Management

Climate-Related Risks & Opportunities

Opportunities

• Development of decarbonization DX solutions

Sustainable Products & Innovation

• Decarbonization DX Solutions