Climate Change Data

Environmental Metrics

ESG Focus Areas

• Social
• Governance

Environmental Achievements

• Implemented paperless processes through cloud-based systems for HR, attendance, accounting, and expense settlement.
• Promoted resource-efficient environment and reduced environmental burden through the use of electronic signatures for quotations and basic contracts.

Social Achievements

• Increased female employee ratio from 28% to 30%.
• Increased foreign employee ratio to 42% due to ZELTO acquisition.
• Offered various employee benefits such as refresh leave, rent subsidies, book subsidies, and support programs for working parents.
• Implemented internship programs, job change systems, and global challenge systems to support career development.

Governance Achievements

• Regularly held compliance committee meetings.
• Disseminated anti-sexual harassment and power harassment policies.
• Maintained a high ratio of outside directors, ensuring appropriate checks and balances.
• Established an audit committee to oversee and support internal and external audits, ensuring the reliability and transparency of financial reporting.

Climate Goals & Targets

Environmental Challenges

• Cookie regulations and targeting restrictions impacting advertising platform revenue.
• Risks associated with overseas expansion, including unique business customs and government regulations.
• Potential for information asset leakage from SaaS product adopting companies.
• Potential for new technologies and services from competitors to reduce competitiveness.
• Potential for losses due to misalignment between investment and market expansion speed.
• Potential for contingent liabilities, unrecognized liabilities, and internal control deficiencies after acquisitions.

Mitigation Strategies

• Approaching less susceptible industries.
• Continuous technological investment by benchmarking competitors.
• Obtaining privacy mark certification and continuously improving personal information management.
• Developing new technologies and collaborating with other companies.
• Analyzing advanced overseas cases and conducting due diligence with internal and external experts.
• Postponing investments until revenue generation is secured.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Society
• Governance

Environmental Achievements

• Introduced a cloud-based HR, attendance, accounting, and expense reimbursement system to achieve thorough paperless operation
• Request the conclusion of quotations and basic contracts with electronic signatures in principle to make effective use of resources, reduce environmental impact, and improve operational efficiency

Social Achievements

• Comfortable working environment such as refreshment leave, rent subsidy, book subsidy, and a working mom and dad support system, as well as support for career advancement such as an internship system, a job change system, and a global challenge system.
• Actively hiring female employees and promoting them to managerial positions, and we will continue to promote the development of an environment where it is easy to work together regardless of gender.
• Assign appropriate human resources globally, such as assigning excellent overseas human resources to the head office and appointing head office personnel at overseas bases

Governance Achievements

• Hold regular meetings of the Compliance Committee and ensure that employees are fully aware of the sexual harassment and power harassment policies
• High ratio of outside directors, checks and balances from outside directors function appropriately.
• Supervise and support internal audits and external audits to ensure the reliability and transparency of information related to financial reports as a company with an Audit and Supervisory Committee

Climate Goals & Targets

Environmental Challenges

• Potential decline in revenue due to economic downturns, reduced advertising budgets, and lack of competitiveness
• Potential loss of revenue due to targeting restrictions (cookie regulation)
• Outflow of information assets such as customer information of companies that have introduced SaaS products
• Declining competitiveness, additional system development, and increased labor costs due to the development of new technologies and new services by competitors
• Due to business practices and government regulations specific to each country, the Group may not be able to recover its investment, which may affect the Group's financial position and operating results.
• Due to the timing of the upfront investment associated with entering a new market and the speed of market expansion and the scale of growth, we may not be able to achieve the results we originally envisioned, and we may incur losses due to service suspension or withdrawal.
• Occurrence of contingent or unrecognized liabilities, fraudulent activities or compliance issues due to inadequacies in internal controls after the acquisition, and the possibility of significant losses

Mitigation Strategies

• Approaching industries and industries that are less susceptible to influence
• Benchmark competitors and make continuous technology investments
• Development of new technologies
• Technical Collaboration with Other Companies
• Acquisition of Privacy Mark certification, continuous maintenance and improvement of standards regarding the management of personal information
• Development of new technologies
• Analysis of Overseas Advanced Case Studies
• Technical Collaboration with Other Companies
• Confirmation of regulatory changes by a local legal advisory firm
• Information Coordination between Overseas Subsidiaries and Headquarters
• Interviews with multiple experts
• Overseas Advanced Case Study Survey
• Deferred upfront investment until potential customers are monetized
• Implementation of due diligence by various internal and external experts
• Thorough utilization of M&A know-how and points to keep in mind accumulated in the past

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Social
• Governance

Environmental Achievements

• Implemented paperless processes using cloud-based systems for HR, attendance, accounting, and expense settlement.
• Promoted resource-efficient environment and reduced environmental burden through the use of electronic signatures for quotations and basic contracts.

Social Achievements

• Offered various employee benefits such as refresh leave, rent subsidies, book subsidies, and support for working parents to create a comfortable working environment.
• Implemented internship programs, job change systems, and global challenge systems to support career development.
• Promoted the active employment of female employees and their appointment to management positions to promote the active participation of women.
• Employed suitable personnel globally, including the assignment of excellent overseas personnel to headquarters and the appointment of headquarters personnel to overseas bases.

Governance Achievements

• Held regular meetings of the Compliance Committee and thoroughly publicized the company's policy on sexual harassment and power harassment.
• Maintained a high ratio of outside directors, ensuring appropriate checks and balances from outside directors.
• Established an Audit Committee to supervise and support internal and external audits, ensuring the reliability and transparency of financial reporting information.

Environmental Challenges

• Potential decrease in revenue due to targeting regulations from cookie restrictions.
• Potential for losses due to delays in market expansion speed and growth scale in new market entries.
• Potential for significant losses due to the occurrence of contingent liabilities or unrecognized liabilities after acquisitions, and due to internal control deficiencies or non-compliance issues.
• Economic downturn, reduced advertising budgets, and lack of competitiveness leading to revenue decline.
• Difficulties in recovering investments due to the need to adapt to unique business customs and government regulations in each country.

Mitigation Strategies

• Approaching industries and sectors less susceptible to influence.
• Continuously investing in technology by benchmarking against competitors.
• Developing new technologies and collaborating with other companies.
• Obtaining Privacy Mark certification and continuously maintaining and improving the level of personal information management.
• Developing new technologies and collaborating with other companies.
• Analyzing advanced overseas examples.
• Verifying regulation changes through local consulting law firms.
• Strengthening information sharing between overseas subsidiaries and headquarters.
• Postponing upfront investment until the profitability of potential customers is secured.
• Conducting due diligence with internal and external experts.
• Thoroughly utilizing accumulated M&A know-how and points to note.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Social
• Governance

Environmental Achievements

• Implemented paperless systems for HR, attendance, accounting, and expense settlement using cloud systems.
• Promoted resource efficient use and reduced environmental burden through the principle of electronic signatures for quotations and basic contracts.

Social Achievements

• Provided various support systems for employees to work comfortably, including refresh holidays, rent subsidies, book subsidies, and support systems for working parents.
• Promoted the active employment of female employees and their appointment to management positions to promote the active participation of women.
• Facilitated career development through internship programs, job change systems, and global challenge systems.

Governance Achievements

• Regularly held compliance committees and thoroughly disseminated information about sexual harassment and power harassment policies.
• Maintained a high ratio of outside directors, ensuring appropriate checks and balances.
• Established an audit committee to supervise and support internal and external audits, ensuring the reliability and transparency of financial reporting.

Climate Goals & Targets

Environmental Challenges

• Fluctuations in internet advertising market conditions and competition.
• Cookie regulations.
• Information security and personal information management.
• Technological innovation.
• Risks associated with overseas business.
• Entry into new service areas.
• Corporate acquisitions and investments.

Mitigation Strategies

• Approaching industries and sectors less susceptible to market fluctuations.
• Benchmarking against competitors and continuous investment in technology.
• Developing new technologies and collaborating with other companies.
• Obtaining Privacy Mark certification and maintaining and improving the level of personal information management.
• Developing new technologies, analyzing advanced overseas examples, and collaborating with other companies.
• Verifying regulation changes through local consulting law firms and enhancing information sharing between overseas subsidiaries and headquarters.
• Conducting due diligence with internal and external experts, and thoroughly utilizing accumulated M&A know-how and points to note.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Requested quotations and basic contracts to be electronically signed in principle to reduce environmental impact, optimize resource use, and improve business efficiency.
• Achieved complete paperless operations by adopting cloud-based systems for HR, attendance, accounting, and expense reimbursement.

Social Achievements

• Actively hiring and promoting female employees to management positions to support their success.
• Assigned the right people to the right positions globally, including relocating talented overseas personnel to the head office and promoting head office staff to overseas positions.

Governance Achievements

• With a high proportion of external directors, oversight and checks by these directors functioned effectively.
• As a company with an audit and supervisory committee, we ensured the reliability and transparency of financial reporting by supervising and supporting both internal and external audits.

Climate Goals & Targets

Environmental Challenges

• Possible decline in revenue due to economic downturn, reduction in advertising budgets, and a lack of competitiveness.
• Possible decline in revenue due to regulations on targeted advertising.
• Leakage of information assets such as customer information of companies that adopted SaaS products.
• Possible decline in competitiveness, additional system development, and increased labor costs due to competitors' development of new technologies and introduction of new services.
• Possible impact on our Group’s financial position and operating results from not being able to recover our investment due to country-specific business practices, government regulations, and other factors.
• Possible losses due to service suspension or withdrawal as a result of failure to achieve initially expected results due to timing discrepancies between upfront investment associated with entering a new market and the speed or scale of market expansion.
• Possible significant losses due to the occurrence of contingent or unrecognized liabilities after an acquisition, or potential fraud or compliance issues due to inadequate internal controls.

Mitigation Strategies

• Approach business sectors/industries that are less likely to be affected.
• Benchmark competitors and continue investing in technology.
• Develop new technologies.
• Cooperate technically with other companies.
• Obtain Privacy Mark certification, maintain and improve the level of management of personal information on a continuous basis.
• Develop new technologies.
• Analyze overseas advanced cases.
• Cooperate technically with other companies.
• Confirm regulatory changes with a local corporate legal firm.
• Collaborate on information between overseas subsidiaries and the head office.
• Interview multiple experts.
• Study overseas advanced cases.
• Defer upfront investments until strategies to earn profit from potential customers are established.
• Conducting due diligence with various internal and external experts
• Utilize M&A know-how and insights accumulated from the past.

Supply Chain Management

Climate-Related Risks & Opportunities