This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between this translated document and the Japanese original, the original shall prevail.
SEPTENI HOLDINGS CO., LTD. (“the Company”) assumes no responsibility for this translation or for direct, indirect or
any other forms of damages arising from the translation.

CONVOCATION NOTICE FOR THE 33RD ORDINARY
GENERAL MEETING OF SHAREHOLDERSSEPTENI HOLDINGS CO., LTD.

Securities Code: 4293

Date of sending by postal mail: March 8, 2024
Start date of measures for providing information in electronic format: February 28, 2024
Dear Shareholder
Koki Sato,
Representative Director
Group President and Chief Executive Officer

SEPTENI HOLDINGS CO., LTD.
17-1 Nishishinjuku 8-chome, Shinjuku-ku,
Tokyo, JapanCONVOCATION NOTICE FOR THE 33RD ORDINARY
GENERAL MEETING OF SHAREHOLDERS
You are cordially invited to the 33rd Ordinary General Meeting of Shareholders of the Company, which
will be held as described below.
Based on relevant laws and regulations and the Article 13 of the Company’s Articles of Incorporation, this
General Meeting of Shareholders will be held as a general meeting of shareholders without a designatedlocation for the shareholders meeting (virtual-only shareholders meetings). We therefore request that you
attend this General Meeting of Shareholders via the website designated by the Company(https://web.sharely.app/login/septeni33) (in Japanese).
When calling this General Meeting of Shareholders, the Company takes measures for providing
information that constitutes the content of reference documents for the general meeting of shareholders, etc.
(items for which measures for providing information in electronic format are to be taken) in electronic
format, and posts this information on the following websites. Please access any one of the websites byusing the internet address shown below to review the information.
The Company’s website:
https://www.septeni-holdings.co.jp/ir/stock/shareholders/index.html (in Japanese)
Website for posted informational materials for the general meeting of shareholders:
https://d.sokai.jp/4293/teiji/ (in Japanese)
Tokyo Stock Exchange (TSE) website (Listed Company Search):https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show (in Japanese)(Access the TSE website by using the internet address shown above, enter “SEPTENI HOLDINGS” in“Issue name (company name)” or the Company’s securities code “4293” in “Code,” and click “Search.”Then, click “Basic information” and select “Documents for public inspection/PR information.” Under“Filed information available for public inspection,” click “Click here for access” under “[Notice ofGeneral Shareholders Meeting /Informational Materials for a General Shareholders Meeting].”)For details on the environment and procedures required to attend the meeting, please refer to the “Guide to
the Virtual-Only Shareholders Meeting” on pages 4 to 7 (in Japanese only).
If you do not attend the meeting in person, you may exercise your voting rights via the Internet or inwriting (by postal mail). Please review the Reference Documents for the General Meeting of Shareholders
and exercise your voting rights by 6:00 p.m. on Tuesday, March 26, 2024. When exercising your voting
rights via the Internet, etc. or in writing (by postal mail), please refer to the “Guide to the Exercise of
Voting Rights” on page 3 (in Japanese only).

-1-1. Date and Time:

Wednesday, March 27, 2024, at 10:00 a.m.
* Login will be available at around 9:30 a.m.
* The reason why the date of this Ordinary General Meeting of Shareholders
is significantly different from the date of the previous Ordinary General
Meeting of Shareholders is that the Company changed the end of its fiscal
year from September 30 to December 31, effective from the 33rd term
(current fiscal year).

2. Holding of the meeting The General Meeting of Shareholders will be held as a general meeting ofshareholders without a designated location for the shareholders meeting.
* There will be no venue as the meeting will be held completely online.
* Please attend through the Company’s designated website:
https://web.sharely.app/login/septeni33 (in Japanese).
For details on the URL of the relevant website, the access and login
methods, and procedures necessary to attend the meeting, please refer to theinformation on pages 4 to 7 (in Japanese only).
3. Meeting Agenda
Matters to be reported:
1. The Business Report and Consolidated Financial Statements for the Company’s 33rd
term (from October 1, 2022 to December 31, 2023) and the results of audits of theConsolidated Financial Statements by the Financial Auditor and the Board of Company
Auditors
2. Non-consolidated Financial Statements for the Company’s 33rd term (from October 1,
2022 to December 31, 2023)
Matters to be resolved:
Agenda Item No. 1:
Appropriation of Surplus
Agenda Item No. 2:
Partial Amendment of the Articles of Incorporation
Agenda Item No. 3:
Election of Nine Directors
Agenda Item No. 4:
Election of Two Company Auditors
To Institutional Investors

You may use the Electronic Proxy Voting Platform operated by ICJ Inc., as a methodof exercising your voting rights for the General Meetings of Shareholders.

 If you exercise your voting rights in writing (by postal mail) and do not indicate your approval or disapproval of any of the
proposals in the Voting Rights Exercise Form, we will treat it as if you have indicated your approval.
 The paper-based documents including items for which measures for providing information in electronic format are to betaken will be delivered together with this notice to the shareholders who requested the delivery of paper-based documents.
However, in accordance with the provisions of laws and regulations and Article 19 of the Articles of Incorporation of theCompany, the following items are excluded in such paper-based documents.
1) Notes to Consolidated Financial Statements
2) Notes to Non-consolidated Financial Statements
Accordingly, the Business Report, the Consolidated Financial Statements and the Non-consolidated Financial Statements
included in this document are a part of the documents subject to the audit by the financial auditor and company auditors.
 If any amendment is made to the items for which measures for providing information in electronic format are to be taken, a
notice of the amendments and the details of the items before and after the amendments will be posted on the aforementioned
websites.

-2-

Reference Documents for the General Meeting of Shareholders
Agenda Items and Reference Matters
Agenda Item No. 1:
Appropriation of Surplus
The Company proposes the appropriation of surplus as follows:
In consideration of our consolidated earnings performance of each fiscal year, the strengthening of our
financial position, the Group’s business strategy going forward and other factors, the Company endeavors to
flexibly provide an appropriate level of profit distribution. In principle, the Company sets a minimum annual
dividend per share of ¥3 and determines dividends based on a target dividend payout ratio of around 25% ofprofit attributable to owners of parent.
Based on the above, the Company proposes to pay year-end dividends for the 33rd term as follows.
The Articles of Incorporation of the Company stipulate that the Company may determine dividends of surplus,
etc. by a resolution of the board of directors pursuant to the provisions of Article 459, paragraph (1) of theCompanies Act. However, since the fiscal year under review is a 15-month period due to a change in the
Company’s fiscal year-end, the year-end dividends for the fiscal year under review is determined by thegeneral meeting of shareholders.
Matters related to year-end dividends(1) Type of dividend property
Cash(2) Matters concerning allocation of dividend property and the total amount thereof¥5.20 per common share of the Company
Total amount of dividends: ¥1,086,173,977(3) Effective date of the dividends of surplus
March 28, 2024

-3-

Agenda Item No. 2:
1. Reasons for the proposal

Partial Amendment of the Articles of Incorporation

The Company has introduced an executive officer system from the viewpoint of strengthening corporate
governance. For the purpose of transitioning to a collective leadership system and further strengthening themanagement structure by establishing the new position of Group Executive Vice President and Executive
Officer, the Company now proposes to add a position of Group Executive Vice President and Executive
Officer (Article 27, paragraph (2) of the proposed amendments).
2. Details of the amendments
The details of the amendments are as set forth below. The unchanged Article texts of the current articles ofincorporation are omitted.
(Underlined parts denote amendments.)
Current articles of incorporation

Proposed amendments(Executive Officers)
Article 27
1 (Article text omitted)
2 The board of directors may, by its resolution, appoint one
Group President and Chief Executive Officer from among
the Executive Officers, and may also appoint a Senior
Executive Officer.

(Executive Officers)
Article 27
1 (Remains the same)
2 The board of directors may, by its resolution, appoint one
Group President and Chief Executive Officer from among
the Executive Officers, and may also appoint a Group
Executive Vice President and Executive Officer and a
Senior Executive Officer.
3. (Remains the same)

3. (Article text omitted)-4-Agenda Item No. 3:

Election of Nine Directors

At the conclusion of this General Meeting of Shareholders, all seven directors will retire due to the expirationof their respective terms of office.
In that regard, the Company hereby proposes the election of nine directors, including six outside directors,
increasing the number of directors by two (including one outside director), to further enhance the corporate
governance.
To establish a higher level of corporate governance, maintain sustainable growth, and enhance corporate
value over the medium- to long-term, the Company delegates as much of the decision-making and execution
relating to business execution as possible to Group Executive Officers, and so the board of directors canperform thorough oversight of the business execution of the Group Executive Officers.
The oversight function of management is continually strengthening under our board of directors whose
composition comprises a majority of outside directors.
The Company nominates candidates for director based on a strong sense of ethics and responsibility, and theextensive knowledge and experience, as well as character, required for the Company’s management decisionmaking, or the track record and insight required to enhance the oversight function of management.
In nominating candidates for director, based on the above policy, the candidates are nominated at a meetingof the board of directors, following deliberation by the Nomination and Remuneration Advisory Committee,
composed only of outside directors and the Group President and Chief Executive Officer.
The candidates are as follows:-5-

Candidate
No.

Name

1

Yuichi Kouno

2

Yusuke Shimizu

Representative Director, SEPTENI CO.,
LTD.

－/－

New candidate

Representative Director and President,
SEPTENI CO., LTD.

－/－Group Senior Executive Officer

Etsuko Okajima

4

Yusuke Asakura

5

Yoshiki Ishikawa

7

New candidate

Group Senior Executive Officer

3

6

Attendance
to the board
Important positions held at other companiesof directors
meetings

Outside director

Outside director

Outside director

Akie Iriyama
Outside director

Mio Takaoka
Outside director

CEO, ProNova Inc.
External Director, MARUI GROUP Co.,
Reelection
Ltd.
Outside director
External Director, LANCERS, Inc.
Independent officer
Outside Director, Yappli, Inc.
Director, CHRO, Euglena Co., Ltd.

19/19

Reelection
Representative Director, Signifiant Inc.
Outside director
Founding Partner, Animal Spirits Ltd.
Independent officer

19/19

Representative Director, Well-being for
Reelection
Outside director
Planet Earth Foundation
Independent officer External Director, Gaiax Co. Ltd.

19/19

Professor, Business School, Waseda
University
External Director, ROHTO Pharmaceutical
Reelection
Outside director
Co., Ltd.
Independent officer Outside Director, Sanoh Industrial Co., Ltd.
Outside Director (Audit & Supervisory
Committee Member), SORACOM, INC.

19/19

Partner, DNX Ventures
Outside Director, HENNGE K.K.
Reelection
Outside director
Outside Director, DENTSU SOKEN INC.
Independent officer Outside director (Audit & Supervisory
Committee Member), KAYAC Inc.

19/19

－/－

8

Makoto Shiono

Partner/Managing Director, Industrial
Growth Platform Inc.
Executive Managing Director, CIO, JBIC
New candidate
Outside director
IG Partners
Independent officer Director, JB Nordic Ventures Oy
Outside Director, beBit, Inc.
Outside Director, INCLUSIVE, INC.

9

Tadashi Kitahara

New candidate-6-

Executive Officer, Dentsu Inc.
Director, Dentsu Digital Inc.
Director, CARTA HOLDINGS, INC.

－/－

1

Yuichi Kouno(Date of birth: September 22, 1982)

New candidate
Number of years in office– years
Attendance to the board of directors meetings–/–
Number of the Company’s common shares held 91,400

Profile, position and duties at the Company
Apr. 2006
Joined the Company
Oct. 2014
Officer of Third Account Division, SEPTENI CO., LTD.
Oct. 2015
Officer of Second Account Division, Septeni Japan, Inc.
Jan. 2017
Officer and General Manager of Second Account Division, Septeni Japan, Inc.
Jan. 2018
Group Executive Officer of the Company
Dec. 2018
Representative Director, SEPTENI CO., LTD. (current position)
Dec. 2018
Representative Director, Septeni Japan, Inc. (current position)
Jan. 2022
Group Senior Executive Officer of the Company (current position)
Nov. 2022
Outside Director, and factory,inc.
Dec. 2022
Director, Dentsu Digital Inc. (current position) (scheduled to retire on March 25, 2024)
 Reasons for nomination as candidate for director
Mr. Yuichi Kouno has extensive experience and results, and considerable insight in the Group’s Digital Marketing Businessand new businesses, and because he is expected to play appropriate roles and exercise strong leadership on the Company’s
further growth, business expansion and all aspects of business administration, he is deemed necessary for enhancing
corporate value and has been nominated as candidate for director.
 Important positions held at other companies
Representative Director, SEPTENI CO., LTD.

2

Yusuke Shimizu(Date of birth: June 19, 1982)

New candidate
Number of years in office– years
Attendance to the board of directors meetings–/–
Number of the Company’s common shares held 52,000 shares

Profile, position and duties at the Company
Apr. 2006
Joined the Company
Oct. 2014
Officer of Media Solutions Division, SEPTENI CO., LTD.
Oct. 2015
Officer of Media Growth Division, Septeni Japan, Inc.
Jan. 2017
Officer and General Manager of Media Division, Septeni Japan, Inc.
Jan. 2018
Group Executive Officer of the Company
Dec. 2018
Representative Director and President, SEPTENI CO., LTD. (current position)
Dec. 2018
Representative Director and President, Septeni Japan, Inc. (current position)
Jan. 2022
Group Senior Executive Officer of the Company (current position)
 Reasons for nomination as candidate for director
Mr. Yusuke Shimizu has extensive experience and results, and considerable insight in the Group’s Digital Marketing
Business as well as operational experience in the field of corporate planning, and because he is expected to drive themanagement of the Group and further enhance and drive corporate governance, he is deemed necessary for enhancing
corporate value and has been nominated as candidate for director.
 Important positions held at other companies
Representative Director and President, SEPTENI CO., LTD.

-7-

3

Etsuko Okajima(Date of birth: May 16, 1966)

Reelection
Outside director
Independent officer
8 years and 3
monthsAttendance to the board of directors meetings
19/19
Number of the Company’s common shares held –Number of years in office

Profile, position and duties at the Company
Apr. 1989
Joined Mitsubishi Corporation
Jan. 2001

Joined McKinsey & Company

Mar. 2002

Joined Globis Management Bank, Inc.

Jul. 2005

President, Globis Management Bank, Inc.

Jun. 2007

CEO, ProNova Inc. (current position)

Jun. 2014

Outside Director, Astellas Pharma Inc.

Jun. 2014

External Director, MARUI GROUP Co., Ltd. (current position)

Nov. 2015

External Director, LANCERS, Inc. (current position)

Dec. 2015

Outside Director of the Company (current position)

Mar. 2016

Outside Director, Link and Motivation Inc.

Jul. 2018

Outside Director, Yappli, Inc. (current position)

Dec. 2018

Outside Director, Euglena Co., Ltd.

Feb. 2019

External Director, Money Forward, Inc.

Dec. 2020

Director, CHRO, Euglena Co., Ltd. (current position)

 Reasons for nomination as candidate for outside director and outline of expected roles
Ms. Etsuko Okajima has an abundance of experience and knowledge, and considerable insight of corporate management, andbecause she has actively provided useful advice on all aspects of the business administration of the Group from an
independent and objective position, she is deemed capable of providing oversight and advice on the Company’s businessadministration as an outside director, and has once again been nominated as candidate for outside director.
 Important positions held at other companies
CEO, ProNova Inc.; External Director, MARUI GROUP Co., Ltd.; External Director, LANCERS, Inc.; Outside Director,
Yappli, Inc.; Director, CHRO, Euglena Co., Ltd.

-8-

4

Yusuke Asakura(Date of birth: July 23, 1982)

Reelection
Outside director
Independent officer
6 years and 3
monthsAttendance to the board of directors meetings
19/19
Number of the Company’s common shares held –Number of years in office

Profile, position and duties at the Company
Apr. 2007
Joined McKinsey & Company
Aug. 2010
Joined Naked Technology Inc.
Oct. 2010
Representative Director, President and CEO, Naked Technology Inc.
Oct. 2011
Joined mixi Inc.
Jun. 2013
Representative Director, President and CEO, mixi Inc.
Nov. 2014
Visiting scholar, Stanford University
May 2015
Outside director, Raksul, Inc.
Mar. 2016
Outside director, Loco Partners
Mar. 2017
Visiting scholar, National Graduate Institute for Policy Studies
Jul. 2017
Representative Director, Signifiant Inc. (current position)
Dec. 2017
Outside Director of the Company (current position)
Aug. 2022
Founding Partner, Animal Spirits Ltd. (current position)
 Reasons for nomination as candidate for outside director and outline of expected roles
Mr. Yusuke Asakura has professional, extensive experience and results, and considerable insight as an executive at listed
internet companies, as a researcher and as an investor, and because he has actively provided useful advice on all aspects ofthe business administration of the Group, he is deemed capable of providing oversight and advice on the Company’s businessadministration as an outside director, and has once again been nominated as candidate for outside director.
 Important positions held at other companies
Representative Director, Signifiant Inc.; Founding Partner, Animal Spirits Ltd.

5

Yoshiki Ishikawa(Date of birth: February 27, 1981)

Reelection
Outside director
Independent officer
4 years and 3
monthsAttendance to the board of directors meetings
19/19
Number of the Company’s common shares held –Number of years in office

Profile, position and duties at the Company
Nov. 2008
Director, Cancer Scan Co., Ltd.
Sep. 2014
Director, Campus for H Inc.
Sep. 2018
Representative Director, Well-being for Planet Earth Foundation (current position)
Feb. 2019
Outside Director (Audit & Supervisory Committee Member), Sansan, Inc.
Mar. 2019
External Director, Gaiax Co. Ltd. (current position)
Dec. 2019
Outside Director of the Company (current position)
 Reasons for nomination as candidate for outside director and outline of expected roles
Mr. Yoshiki Ishikawa has professional, extensive experience and results, and considerable insight as both a preventive
medicine researcher and as a founder of a company using methods based on behavioral science, and because he has actively
provided useful advice on all aspects of the business administration of the Group, he is deemed capable of providing
oversight and advice on the Company’s business administration as an outside director, and has once again been nominated as
candidate for outside director.
 Important positions held at other companies
Representative Director, Well-being for Planet Earth Foundation; External Director, Gaiax Co. Ltd.

-9-

6

Akie Iriyama(Date of birth: December 8, 1972)

Reelection
Outside director
Independent officer
3 years and 3
monthsAttendance to the board of directors meetings
19/19
Number of the Company’s common shares held –Number of years in office

Profile, position and duties at the Company
Apr. 1998
Joined Mitsubishi Research Institute, Inc.
Sep. 2008
Assistant Professor, University at Buffalo, the State University of New York
Sep. 2013
Associate Professor, Business School, Waseda University
May 2016
Outside Director, Macromill, Inc.
Apr. 2019
Professor, Business School, Waseda University (current position)
Jun. 2019
External Director, ROHTO Pharmaceutical Co., Ltd. (current position)
Jun. 2020
Outside Director, Sanoh Industrial Co., Ltd. (current position)
Dec. 2020
Outside Director of the Company (current position)
Jun. 2021
Outside Director (Audit & Supervisory Committee Member), SORACOM, INC. (current position)
 Reasons for nomination as candidate for outside director and outline of expected roles
Mr. Akie Iriyama has operational experience as a consultant, along with professional, extensive experience and results andconsiderable insight as a researcher specialized in the management strategies and the global management fields, and because
he has actively provided useful advice on all aspects of the business administration of the Group, he is deemed capable ofproviding oversight and advice on the Company’s business administration as an outside director, and has once again been
nominated as candidate for outside director. Although he has never been involved in corporate management other thanserving as an outside officer, he is deemed capable of properly carrying out the duties of an outside director of the Company
for the reasons mentioned above.
 Important positions held at other companies
Professor, Business School, Waseda University; External Director, ROHTO Pharmaceutical Co., Ltd.; Outside Director,
Sanoh Industrial Co., Ltd.; Outside Director (Audit & Supervisory Committee Member), SORACOM, INC.

- 10 -

7

Mio Takaoka(Date of birth: May 3, 1979)

Reelection
Outside director
Independent officer
3 years and 3
monthsAttendance to the board of directors meetings
19/19
Number of the Company’s common shares held –Number of years in office

Profile, position and duties at the Company
Jul. 1999
Joined Goldman Sachs Japan Securities
Jun. 2002
Joined Morgan Stanley Japan Securities (currently Morgan Stanley MUFG Securities Co., Ltd.)Mar. 2006
Joined Lehman Brothers Japan Securities
Jan. 2009
Joined Monex Group, Inc.
Feb. 2014
Executive, General Manager of new business, Monex Group, Inc.
May 2014
Director, Monex Ventures, Inc.
Sep. 2017
Joined MedicalNote, Inc.
Sep. 2017
Partner, Arbor Ventures
Mar. 2018
Director, MedicalNote, Inc.
Dec. 2020
Outside Director of the Company (current position)
Mar. 2021
Outside director, KAYAC Inc.
Apr. 2021
Partner, DNX Ventures (current position)
Dec. 2021
Outside Director, HENNGE K.K. (current position)
Mar. 2022
Outside Director, Information Services International-Dentsu, Ltd. (currently DENTSU SOKEN INC.)(current position)
Mar. 2022
Outside director (Audit & Supervisory Committee Member), KAYAC Inc. (current position)
 Reasons for nomination as candidate for outside director and outline of expected roles
Ms. Mio Takaoka has professional, extensive experience and results, and considerable insight of strategic investment, newbusiness development and finance, and because she has actively provided useful advice on all aspects of the businessadministration of the Group, she is deemed capable of providing oversight and advice on the Company’s businessadministration as an outside director, and has once again been nominated as candidate for outside director.
 Important positions held at other companies
Partner, DNX Ventures; Outside Director, HENNGE K.K.; Outside Director, DENTSU SOKEN INC.; Outside director(Audit & Supervisory Committee Member), KAYAC Inc.

- 11 -

8

Makoto Shiono(Date of birth: November 12, 1975)

New candidate
Outside director
Independent officer
Number of years in office– years
Attendance to the board of directors meetings–/–
Number of the Company’s common shares held –Profile, position and duties at the Company
Apr. 1998
Joined Citibank, N.A., Tokyo BranchOct. 1999
Joined Goldman Sachs Japan Co., Ltd., Tokyo BranchAug. 2000
Joined Members Co., Ltd. (seconded to EC-watch.com Co., Ltd. as CFO)
Sep. 2001
Joined Bain & Company Inc.
Apr. 2003
Joined livedoor Co., Ltd
Jul. 2008
Joined Industrial Growth Platform, Inc.
Jan. 2012
Partner/Managing Director, Industrial Growth Platform Inc. (current position)
Jun. 2017
Executive Managing Director, CIO, JBIC IG Partners (current position)
Apr. 2018
External Director, NewsPicks, Inc.
Oct. 2018
Director, JB Nordic Ventures Oy (current position)
Jun. 2020
Outside Director, beBit, Inc. (current position)
Jun. 2022
Outside Director, INCLUSIVE, INC. (current position)
 Reasons for nomination as candidate for outside director and outline of expected roles
Mr. Makoto Shiono has extensive experience and results, and considerable insight in strategic planning and implementation
consulting and M&A advisory services for domestic and foreign companies and government agencies, he is deemed capableof providing oversight and advice on the Company’s business administration as an outside director, and has been nominatedas candidate for outside director.
 Important positions held at other companies
Partner/Managing Director, Industrial Growth Platform Inc.; Executive Managing Director, CIO, JBIC IG Partners; Director,
JB Nordic Ventures Oy; Outside Director, beBit, Inc.; Outside Director, INCLUSIVE, INC.

- 12 -

9

Tadashi Kitahara(Date of birth: July 15, 1968)

New candidate
Number of years in office– years
Attendance to the board of directors meetings–/–
Number of the Company’s common shares held –Profile, position and duties at the Company
Apr. 1991
Joined Dentsu Inc. (currently Dentsu Group Inc.)
Jan. 2019
Managing Director of the Business Produce Division, Dentsu Inc.
Mar. 2019
Director, NewsPicks Studios Inc.
Jan. 2022
Executive Officer, Dentsu Inc. (current position)
Jan. 2022
Director, Rakuten Data Marketing, Inc. (current position)
Jan. 2022
Representative Director, Dentsu Digital Inc.
Dec. 2022
Director, Dentsu Digital Inc. (current position)
Mar. 2023
Director, CARTA HOLDINGS, INC. (current position)
Jun. 2023
Director, Japan Interactive Advertising Association (current position)
 Reasons for nomination as candidate for director
Mr. Tadashi Kitahara joined Dentsu Inc. (currently Dentsu Group Inc.) in 1991 and has extensive operational experience andmanagement experience, including serving as an Executive Officer of Dentsu Inc. in charge of the Strategy and Media &Contents of that company since 2022. Therefore, because he is expected to provide useful advice on all aspects of thebusiness administration of the Group and contribute to the promotion of alliance operations with the Dentsu Group, he has
been nominated as candidate for director.
 Important positions held at other companies
Executive Officer, Dentsu Inc.; Director, Dentsu Digital Inc.; Director, CARTA HOLDINGS, INC.

- 13 -

(Notes)
1. The name of Ms. Etsuko Okajima in the family register is Etsuko Mino.
2. Ms. Etsuko Okajima, Mr. Yusuke Asakura, Mr. Yoshiki Ishikawa, Mr. Akie Iriyama, Ms. Mio Takaoka, and Mr. Makoto
Shiono are candidates for outside directors.
3. Mr. Yusuke Asakura is a Founding Partner of Animal Spirits Ltd., and the Company has invested in Animal Spirits No. 1
Investment Business Limited Partnership, which is operated by Animal Spirits No. 1 Limited Liability Partnership, of which
Animal Spirits Ltd. is a partner, as an unlimited liability partner. The amount of the investment is less than 0.09% of thetotal assets of the Company as of the end of the fiscal year under review.
4. Apart from what is mentioned in 3. above, there are no other special relationships between the Company and each of thecandidates.
5. In Mr. Tadashi Kitahara’s “Profile, position and duties at the Company and Important positions held at other companies,”
both his current positions and duties and those over the past ten years when he was an executive at the Company’s parent
company, Dentsu Group Inc., and its subsidiaries are also listed.
6. The Company has established “Independence Standards for Outside Officers” (https://www.septeniholdings.co.jp/ir/pdf/isod.pdf) (in Japanese only). There is no information showing any violations of these standards forcandidates Ms. Etsuko Okajima, Mr. Yusuke Asakura, Mr. Yoshiki Ishikawa, Mr. Akie Iriyama, Ms. Mio Takaoka, or Mr.
Makoto Shiono and each candidate is deemed independent.
7. With regard to the inappropriate use of expenses by the Company’s Representative Director (who is scheduled to retire as
Representative Director and Director of the Company at the conclusion of this General Meeting of Shareholders) that was
discovered during the current fiscal year while Ms. Etsuko Okajima, Mr. Yusuke Asakura, Mr. Yoshiki Ishikawa, Mr. Akie
Iriyama, and Ms. Mio Takaoka were serving as outside directors of the Company, the five candidates had always been
providing advice and recommendations to ensure the appropriateness of the execution of duties by directors through theboard of directors. After the inappropriate use was discovered, the five candidates recommended and confirmed measures
to prevent recurrence through an investigation undertaken by the board of company auditors.
8. The Company has designated Ms. Etsuko Okajima, Mr. Yusuke Asakura, Mr. Yoshiki Ishikawa, Mr. Akie Iriyama and Ms.
Mio Takaoka as independent officers in accordance with the rules of Tokyo Stock Exchange, Inc., and has submitted a noticeof designation to the Tokyo Stock Exchange. If the proposed reelection of them is approved, the Company will continue todesignate them as independent officers. Furthermore, if the proposed election of Mr. Makoto Shiono is approved, theCompany will designate him as an independent officer in accordance with the rules of Tokyo Stock Exchange, Inc., and willsubmit a notice of designation to the Tokyo Stock Exchange.
9. The Company has entered into a liability limitation agreement with each of Ms. Etsuko Okajima, Mr. Yusuke Asakura, Mr.
Yoshiki Ishikawa, Mr. Akie Iriyama and Ms. Mio Takaoka. According to the aforementioned liability limitation agreement,
their liability for damages under Article 423, paragraph (1) of the Companies Act will not exceed either ¥5 million or theminimum liability amount stipulated in Article 425, paragraph (1) of the same Act, whichever is higher. If the proposed
reelection of them is approved, the Company plans to again enter into the aforementioned liability limitation agreement withthem. In addition, if the proposed election of Mr. Makoto Shiono is approved, the Company plans to enter into theaforementioned liability limitation agreement with him.
10. The Company has entered into a directors and officers liability insurance policy (management risk protection insurance
policy) as provided for in Article 430-3, paragraph (1) of the Companies Act with an insurance company. If each candidate
is elected and assumes office as director, he or she will be included as an insured in the policy. This insurance policy covers
amounts of indemnification, litigation expenses and other costs that an insured, including the Company’s directors, would
be liable for due to corporate litigation, a third-party lawsuit, a shareholder derivative lawsuit, etc. However, as a measure
to ensure that the proper performance of duties by an insured is not impaired, the insurance policy does not cover any
damages, etc. arising from criminal acts, etc. committed by the insured. The full amount of the insurance premiums for thepolicy is borne by the Company. In addition, when the policy is renewed (July 2024), the Company plans to renew the policy
with the same terms.
11. If Mr. Tadashi Kitahara is elected and assumes his office as director, he will be serving concurrently as Executive Officer ofDentsu Inc., Director of Dentsu Digital Inc., and Director of CARTA HOLDINGS, INC., all of which companies are
subsidiaries of the Company’s parent company Dentsu Group Inc.
12. Mr. Yuichi Kouno is scheduled to assume the position of Group President and Chief Executive Officer of the Company on
April 1, 2024. Mr. Yusuke Shimizu is scheduled to assume the position of Group Executive Vice President and Executive
Officer of the Company on April 1, 2024, contingent on the Agenda Item No. 2 being approved and adopted as originallyproposed.

- 14 -

Agenda Item No. 4:

Election of Two Company Auditors

At the conclusion of this General Meeting of Shareholders, the term of office of Company Auditor Tadahiro
Mouri will expire.
In that regard, the Company hereby proposes the election of two company auditors, increasing the numberof company auditors by one to strengthen the auditing system.
In addition, the consent of the board of company auditors has been obtained for this proposal.
The candidates are as follows:
Candidate
No.

Important positions held at othercompanies

Name

1

Tadahiro Mouri

Reelection
Outside company
auditor2

Hideo Hatano

New candidate

Group Management and Head ofInternal Audit, Dentsu Group Inc.

- 15 -

Attendance
Attendance
to the board
to the boardof companyof directors
auditors
meetings
meetings

19/19

17/17

－/－

－/－

1

Tadahiro Mouri(Date of birth: August 5, 1957)

Reelection
Outside company auditor
Number of years in office

3 years and 3
months
19/19

Attendance to the board of directors meetings
Attendance to the board of company auditors
17/17
meetings
Number of the Company’s common shares held –Profile and position at the Company
Apr. 1980
Joined Taiyo Fishery Co., Ltd. (currently Maruha Nichiro Corporation)
Apr. 2012
General Manager of Administration Department, Maruha Nichiro Foods, Inc. (currently Maruha Nichiro
Corporation)
Apr. 2014
General Manager of Logistics Department, Maruha Nichiro Corporation
Nov. 2014
General Manager of Risk Management Department, Maruha Nichiro Corporation
Apr. 2018
Advisor, DAITO GYORUI CO., LTD.
Jun. 2018
Director (Full-time Audit & Supervisory Committee Member), DAITO GYORUI CO., LTD.
Dec. 2020
Full-time Company Auditor of the Company (current position)
 Reasons for nomination as candidate for outside company auditor
Mr. Tadahiro Mouri has considerable insight and extensive operational experience of auditing, and because he has
provided useful advice and conducted auditing from an independent position, he is expected to provide such auditing,and has once again been nominated as candidate for outside company auditor.
 Important positions held at other companies
None.

- 16 -

2

Hideo Hatano(Date of birth: September 17, 1971)

New candidate
Number of years in officeAttendance to the board of directors meetings
Attendance to the board of company auditors
meetings
Number of the Company’s common shares held

– years–/––/––

Profile and position at the Company
Apr. 1994
Joined General Sekiyu K.K.
Nov. 2005

Credit Control Advisor of the Asia-Pacific region, ExxonMobil Yugen Kaisha

Apr. 2015

General Manager of Audit, GYXIS CORPORATION

May 2016
Oct. 2016

Senior Manager of Integration Promotion and Group Management Preparation Office, TonenGeneral
Sekiyu K.K. (currently ENEOS Corporation)
Internal Audit Manager, Amazon Japan G.K.

Aug. 2019

Head of Japan Internal Audit Office, Nissan Motor Co., Ltd.

Apr. 2021
Aug. 2022

Chief Internal Auditor (Supervisor of Global Monozukuri and audit of Japan-ASEAN region), Nissan
Motor Co., Ltd.
Executive Director of DJN Internal Audit Office, Dentsu Group Inc.

Oct. 2022

Executive Director of Internal Audit Office, Dentsu Group Inc.

Jan. 2023

Executive Officer in charge of internal audit, dentsu Japan, Dentsu Group Inc.

Mar. 2023

Supervisory Board Member, CARTA HOLDINGS, INC. (current position)

Jan. 2024

Group Management and Head of Internal Audit, Dentsu Group Inc. (current position)

 Reasons for nomination as candidate for company auditor
Mr. Hideo Hatano has considerable insight and extensive operational experience of auditing, and he is deemed capable ofproperly carrying out the duties of company auditor by leveraging his experience of internal audits in multiple companies
and expertise thereof, and has been nominated as candidate for company auditor.
 Important positions held at other companies
Group Management and Head of Internal Audit, Dentsu Group Inc.

- 17 -

(Notes)
1. There are no special relationships between the Company and each of the candidates.
2. Mr. Tadahiro Mouri is a candidate for outside company auditor.
3. In Mr. Hideo Hatano’s “Profile, position at the Company and Important positions held at other companies,” both his current
positions and duties and those over the past ten years when he was an executive at the Company’s parent company, Dentsu
Group Inc., and its subsidiaries are also listed.
4. With regard to the inappropriate use of expenses by the Company’s Representative Director (who is scheduled to retire as
Representative Director and Director of the Company at the conclusion of this General Meeting of Shareholders) that was
discovered during the current fiscal year while Mr. Tadahiro Mouri was serving as a full-time company auditor of theCompany, the candidate had always been providing advice and recommendations to ensure the appropriateness of theexecution of duties by directors through the board of directors and the board of company auditors. After the inappropriate
use was discovered, Mr. Mouri recommended and confirmed measures to prevent recurrence through an investigation
undertaken by the board of company auditors.
5. The Company has entered into a liability limitation agreement with Mr. Tadahiro Mouri. According to the aforementioned
liability limitation agreement, their liability for damages under Article 423, paragraph (1) of the Companies Act will not
exceed either ¥5 million or the minimum liability amount stipulated in Article 425, paragraph (1) of the same Act, whicheveris higher. If the proposed reelection of him is approved, the Company plans to again enter into the aforementioned liability
limitation agreement with him.
6. If the proposed reelection of Mr. Tadahiro Mouri is approved at this General Meeting of Shareholders, he plans to assume
the position of full-time company auditor.
7. The Company has entered into a directors and officers liability insurance policy (management risk protection insurance
policy) as provided for in Article 430-3, paragraph (1) of the Companies Act with an insurance company. If each candidate
is elected and assumes office as company auditor, he or she will be included as an insured in the policy. This insurance
policy covers amounts of indemnification, litigation expenses and other costs that an insured, including the Company’s
company auditors, would be liable for due to corporate litigation, a third-party lawsuit, a shareholder derivative lawsuit, etc.
However, as a measure to ensure that the proper performance of duties by an insured is not impaired, the insurance policy
does not cover any damages, etc. arising from criminal acts, etc. committed by the insured. The full amount of the insurance
premiums for the policy is borne by the Company. In addition, when the policy is renewed (July 2024), the Company plansto renew the policy with the same terms.
8. If Mr. Hideo Hatano is elected and assumes his office as company auditor, he will be serving concurrently as the GroupManagement and Head of Internal Audit of Dentsu Group Inc., which is the Company’s parent company.

- 18 -

Business Report (From October 1, 2022 to December 31, 2023)
1. Current status of the SEPTENI Group(1) Business progress and results(Note) The accounting period for the fiscal year under review is an irregular 15-month period due to a change in the fiscal
year-end (changed from September 30 to December 31), and thus year-on-year changes are not shown. In addition,
the operating results of COMICSMART INC. and its subsidiaries, etc. are reclassified to discontinued operations.
Therefore, revenue, non-GAAP operating profit, operating profit, and profit before tax each indicate the amount ofcontinuing operations, excluding discontinued operations.

Earnings for the fiscal year under review
Individual smartphone ownership in Japan rose to 77.3% in 2022, as the quantitative expansion continued,
with the exceptionally high popularization rate of more than 90% of those in their 20s through 50s now
owning a smartphone. At the same time, the individual objectives for smartphone use are also diversifying
with the increasing usage rate of SNS (social networking services), meaning we are also seeing a profoundqualitative change in use (source: “Communications Usage Trend Survey in 2022,” Ministry of Internal
Affairs and Communications). As such, with the smartphone becoming a mainstream device to access theInternet, in the market for various services and applications, expansion into content such as video, music, ande-books is accelerating. Additionally, social media is being used not only for communication, but is also
expanding into fields such as payments and purchases. As its influence is growing even stronger, demand formarketing support utilizing the individual characteristics of different media as well as data and AI is also
increasing further. Furthermore, internet advertising expenditures in the Japanese advertising market in 2022
reached ¥3,091.2 billion (up 14.3% year on year), exceeding that of the four traditional mass media
advertising expenditures (¥2,398.5 billion, down 2.3% year on year, source: “2022 Advertising Expendituresin Japan” by Dentsu Inc.). As such, the COVID-19 pandemic has also been a catalyst for bringing about amassive wave of digital transformation (DX) across all industries, and even in the advertising industry, we
have seen further growth in demand for digital marketing.
Amid this environment, despite being affected by the economy, our mainstay Digital Marketing Businessacquired new clients, expanded existing businesses, and promoted collaboration with the Dentsu Group. In
addition, we have implemented upfront investments centered on strengthening investment in human capital.
As a result, revenue was ¥34,267 million, non-GAAP operating profit was ¥5,091 million, operating profit
was ¥4,949 million, profit before tax was ¥6,652 million, profit was ¥4,267 million, and profit attributableto owners of parent was ¥4,319 million.

- 19 -

Adoption of the International Financial Reporting Standards (hereinafter referred to as “IFRS”)
The Group has applied IFRS since the fiscal year ended September 30, 2016 in place of previously used
Japanese GAAP, aiming for better convenience for all of the Group’s stakeholders, including shareholders
and investors in and outside Japan, while promoting actively its global business development.
In addition, the Group discloses “non-GAAP operating profit,” an indicator that is not defined in IFRS on a
voluntary basis. Non-GAAP operating profit (or loss) is a profit indicator of constant business performance
determined by excluding gains and losses related to acquisition actions and temporary factors from the IFRSbased operating profit (or loss). Gains and losses related to acquisition actions refer to amortization of
acquisition-related intangible assets, M&A expenses, etc., and unusual items refer to one-off items, such as
stock-based compensation expenses, impairment loss and gains or losses on sales of non-current assets, that
the Group believes shall be excluded for the purposes of preparing a future outlook based on certain rules.
Revenue:

Non-GAAP operating profit:¥34,267 million
Profit attributable to owners of parent:¥5,091 million
Dividends per share:¥5.2¥4,319 million

Previous term: ¥4.6

(Note) The dividends per share is a projected figure based on the assumption that Agenda Item No. 1 of the 33rd Ordinary
General Meeting of Shareholders is approved as originally proposed.

- 20 -

The overview of operating results by major business segment is as follows. Revenue and non-GAAP
operating loss for the Media Platform Business are shown before the reclassification of the results of
COMICSMART INC. and its subsidiaries, etc. to discontinued operations.
Digital Marketing Business■ Major business
The Digital Marketing Business provides comprehensive support for corporate DX centered on digitalmarketing that includes, starting with the sales and operations of digital advertisements, the provisionof solutions using data and AI as well as marketing support integrating online and offline solutions
through our business alliance with the Dentsu Group.
During the fiscal year under review, despite being affected by the economy, our mainstay Digital Marketing
Business acquired new clients, expanded existing businesses, and promoted collaboration with the Dentsu
Group. In addition, we have implemented upfront investments centered on strengthening investment in
human capital.

Non-GAAP operating profit: ¥8,527 million

Revenue: ¥32,112 million

Media Platform Business■ Major business
The Media Platform Business consists of the IP Platform Business, Employment Platform Business,
Social Contribution Platform Business, Childcare Platform Business, and other businesses. The IP
Platform Business engages in cultivating and supporting manga artists and operates a manga
distribution service through the manga application “GANMA!,” the Company’s own media, for the
purpose of planning and developing its own intellectual property (IP).
During the fiscal year under review, the Media Platform Business grew mainly in the IP Platform Businessand reduced losses, but other businesses were sluggish in the post-COVID-19 environment.
Non-GAAP operating loss: ¥656 million

Revenue: ¥5,839 million- 21 -

(2) Trends in financial position and profit and loss
 IFRS
Category
Revenue (Thousand yen)

30th term (ended
September 30,
2020)

31st term (ended 32nd term (ended 33rd term (ended
September 30,
September 30,
December 31,
2021)
2022)
2023)

17,937,745

21,383,875

27,589,386

34,266,611

Operating profit (Thousand yen)

2,274,396

3,650,046

6,165,779

4,949,134

Non-GAAP operating profit (Thousand yen)

2,452,413

3,796,011

6,565,177

5,091,306

Profit attributable to owners of parent(Thousand yen)

1,464,342

2,604,103

5,733,564

4,318,831

Total assets (Thousand yen)

34,424,711

42,011,169

88,731,112

93,605,990

Basic earnings per share (Yen)

11.58

20.59

30.54

20.74

Dividends per share (Yen)

2.00

3.40

4.60

5.20

Return on equity (ROE) (%)

9.6

15.2

14.1

6.7

(Notes)1. The accounting period for the 33rd term is a 15-month period from October 1, 2022 to December 31, 2023, due to a change
in the fiscal year-end.
2. The operating results of COMICSMART INC. and its subsidiaries, etc. for the 33rd term are reclassified as discontinued
operations. As a result, revenue, operating profit, and non-GAAP operating profit for the 32nd term have been retroactively
adjusted.
3. The dividends per share for the 33rd term is a projected figure based on the assumption that Agenda Item No. 1 of the 33rd
Ordinary General Meeting of Shareholders is approved as originally proposed.

- 22 -

(3) Issues to be addressed
Under the new management structure, the Group’s medium-term theme for the fiscal year ending
December 31, 2024 and beyond is “Focus & Synergies.” Based on the human capital management thathas been built up to date, the Group will create synergies among its business segments and within its
business domains while evolving its strengths to become a group with multiple strong businesses,
aiming to achieve sustainable growth and increase corporate value over the medium to long term.
In the Digital Marketing Business, by dividing the business into three areas: “Marketing
Communications Area,” “Direct Business Area,” and “Data & Solutions Area,” we will develop area
management while reorganizing and strengthening the business. In addition, we will work to creategroup synergies by leveraging the assets of the Digital Marketing Business and aim to create new
businesses from within each area.
Furthermore, as growth investments, we will consider investments for organic growth and new businesscreation, as well as M&A for growth in each area of the Digital Marketing Business.
In addition, the Company discovered inappropriate use of expenses (totaling approximately 22 million
yen) by the Representative Director of the Company (who is scheduled to retire as Representative
Director and Director of the Company at the conclusion of the 33rd Ordinary General Meeting of
Shareholders to be held on March 27, 2024) during the current fiscal year. Based on the results of theinvestigation by the board of company auditors, the following measures to prevent recurrence have beenformulated and implemented after analyzing the causes of the inappropriate use by the Representative
Director of the Company. The Company’s Representative Director has reimbursed the Company for all
expenses incurred for such inappropriate use.
-

Implementation of re-education for officers with the aim of ensuring thorough compliance.

-

Improving and strengthening the system for checking the appropriateness of expenses claimed by
officers.

-

Stricter regulations and approval process for expense processing regarding the use of travel andtransportation expenses by officers.

-

Formulating new regulations for use of hired cars by officers.

-

Adding check items regarding expenses in internal audits, and continuing auditing of theappropriateness and operating effectiveness of the regulations regarding expenses used by officers.

The Company will continue to regularly review and strengthen its management systems, including its
internal control system, to prevent the recurrence of inappropriate use of expenses.

- 23 -

(4) Capital investments
Nothing noteworthy to report.
(5) Financing
Nothing noteworthy to report.
(6) Business transfers, absorption-type company split or incorporation-type company split
Not applicable.
(7) Business transfers from other companies
Not applicable.
(8) Succession of rights and obligations relating to other entities’ business as a result of absorption-typemerger or company split
Not applicable.
(9) Acquisition or disposal of shares, other equities or share options of other companies

On October 25, 2022, the Company concluded a capital and business alliance agreement with andfactory,inc. Under the capital and business alliance agreement, the Company acquired new sharesissued by and factory,inc. through a third-party allocation and the shares of and factory,inc. held
by Mr. Takamasa Ohara, the Chairman of the Board of Directors of and factory,inc., and made thecompany an equity method affiliate of the Company on November 10, 2022.



On November 30, 2023, the Company’s subsidiary SEPTENI CO., LTD. transferred all shares of
JNJ INTERACTIVE INC. to Vector Com Inc., a subsidiary of VECTOR INC.

- 24 -

(10) Parent and significant subsidiaries
1) Relationship with the parent
Company name

Ratio of voting right to theCompany

Share capital

Dentsu Group Inc.

¥74,609 million

Relationship with the Company

52.56% Interlocking of officers(Note) The Company executed the capital and business alliance agreement with Dentsu Group Inc.
Details of business alliance(1) Project collaboration between Dentsu Group Inc. and SEPTENI CO., LTD.
(2) Partnership between Dentsu Digital Inc. and the Group(3) Partnership in the direct marketing domain between Dentsu Direct Inc. and Dentsu Group Inc.
(4) Additionally, the following partnerships between Dentsu Group Inc. and the Group(a) Integrated internal and external customer marketing and public relations strategy(b) Discussion/study on an integrated operating program for the hiring, education, and retention of digital humanresources(c) Deepening alliance operations in integrated online-offline marketing(d) Mutual use of tools

2) Significant subsidiaries
Capital or investment in capital(Thousand yen)

Ratio of voting right of theCompany

SEPTENI CO., LTD.

300,000

100.0%

Internet ad agency

COMICSMART INC.

357,994

89.4%

IP Platform Business

Dentsu Direct Inc.

301,000

100.0%

Directmarketingbusiness

Company name

Major businesssupport(Notes)1. The Company owns a total of 39 consolidated subsidiaries, including the significant subsidiaries described above.
2. The Company does not own any subsidiaries that are specified wholly-owned subsidiaries as provided in Article 118, item
4 of the Regulation for Enforcement of the Companies Act.

(11) Major offices (as of December 31, 2023)
1) The Company
Company name
The Company

Location
Shinjuku-ku, Tokyo

2) Subsidiaries
Company name
SEPTENI CO., LTD.

Location
Shinjuku-ku, TokyoCOMICSMART INC.

Shinjuku-ku, Tokyo

Dentsu Direct Inc.

Minato-ku, Tokyo(12) Employees (as of December 31, 2023)
Business segment

Number of employees

Increase/decrease
from the previous term-end

Digital Marketing Business

1,537

123 increase

Media Platform Business112

4 increase

Corporate (common)86

6 increase

Total

1,735

133 increase(Notes)1. The number of employees indicates the number of working employees.
2. The number of employees under the “Corporate (common)” segment indicates the number of employees who belong to theholding company.
3. The main reason for the 133 increase in the number of employees from the previous term-end is the hiring of new graduates.

- 25 -

(13) Major creditors (as of December 31, 2023)
Creditor

Amount of loans(Million yen)

Sumitomo Mitsui Banking Corporation

2,000

Mizuho Bank, Ltd.

1,000(14) Other important matters regarding the current status of the GroupAt the meeting of the Board of Directors held on December 19, 2023, the Company resolved to sell (with aplanned transfer date of March 29, 2024) 74,000 shares of the 116,400 shares of COMICSMART INC. it
holds in order to help COMICSMART INC. achieve sustainable growth and maximization of its corporate
value. On the date on which the aforementioned shares will be transferred, the Company’s ratio of voting
rights held in COMICSMART INC. and its subsidiaries, etc. will fall from 89.42% to 32.57%, and it willlose control of the aforementioned company. As a result, the Company plans to make the aforementioned
company an affiliate accounted for using the equity method.

- 26 -

2. Status of the Company(1) Matters regarding shares (as of December 31, 2023)
1) Number of shares authorized

370,080,000 shares

2) Number of shares issued

211,079,654 shares (including 2,200,043 treasury shares)

3) Number of shareholders

7,061 (1,658 decrease from the previous business year-end)

4) Major shareholders (top 10 shareholders)Name of shareholder

Number of shares (shares)

Dentsu Group Inc.

Shareholding ratio (%)

109,782,395

52.56

Village seven Co., Ltd.

12,419,000

5.95

Mamoru Nanamura

10,450,500

5.00

The Master Trust Bank of Japan, Ltd. (Trust Account)

5,945,400

2.85

GOLDMAN SACHS INTERNATIONAL

5,529,926

2.65

CGML PB CLIENT ACCOUNT/COLLATERAL

5,046,960

2.42

BNP PARIBAS LONDON BRANCH FOR PRIMEBROKERAGE SEGREGATION ACC FOR THIRD PARTY

4,893,652

2.34

Custody Bank of Japan, Ltd. (Trust Account)

4,271,900

2.05

MLI FOR CLIENT GENERAL OMNI NON COLLATERALNON TREATY-PB

3,631,616

1.74

J.P. MORGAN BANK LUXEMBOURG S.A. 381572

2,857,100

1.37(Notes)1. The above shareholding ratios exclude treasury shares (2,200,043 shares).
2. The treasury shares do not include the Company’s shares owned by the directors’ remuneration BIP (Board Incentive Plan)trust (1,764,502 shares).

5) Status of shares delivered to the Company’s officers as remuneration for the execution of duties during
the business year under review
Category

Number of shares

Directors (excluding outside directors)

Number of eligible persons

244,779 shares

1(Note) The delivery to one director was made in relation to the directors’ remuneration BIP trust; 122,479 shares out of
244,779 shares were converted into cash in accordance with the share delivery rules, and cash corresponding to theamount converted to cash was paid.

6) Other important matters regarding shares
On February 9, 2023, the Company resolved the acquisition of treasury shares of the Company, in
accordance with the provisions of the Articles of Incorporation, pursuant to Article 459, paragraph (1)of the Companies Act, and acquired its treasury shares as follows:
Type of shares acquired

Common shares of the Company

Total number of shares acquired 2,200,000 shares
Acquisition cost¥744,511,600

Acquisition date

From February 17, 2023 to March 17, 2023

Acquisition method

Open-market purchase on the Tokyo Stock Exchange

Reasons for acquisition

To increase shareholder returns through improvement of the capitalefficiency as well as to pursue the agile capital policy that responds
to changes in the management environment.

The Company acquired 1,400,000 common shares of the Company (total acquisition cost of shares:
531,430,449 yen) through a BIP trust during the fiscal year under review.

- 27 -

(2) Matters regarding share options, etc.
1) Status of share options, etc. held by officers of the Company (as of December 31, 2023)
Date of resolution of issue
Category

June 10, 2004

March 10, 2005

January 25, 2006

Director

Director

Director

Number of holders

1

1

1

Number of share options

60

45

100

Number of shares to be issued
upon exercise of share options

120,000 shares

90,000 shares

100,000 sharesClass of shares to be issued
upon exercise of share options

Common shares

Common shares

Common shares

Without contribution

Without contribution

Without contribution

Amount to be paid per shareupon exercise of share options

¥7

¥7

¥7

Exercise period of shareoptions

From June 29, 2004
to December 18, 2033

From March 16, 2005
to December 16, 2034

From February 1, 2006
to December 20, 2035

Share options in share-based
payment arrangement

Share options in share-based
payment arrangement

Share options in share-based
payment arrangement

Issue priceRemarks(Notes)
1. Share options are not granted to outside directors.
2. As the Company implemented share splits, the number of shares and issue price provided above were adjusted accordingly.
The share splits for which adjustments were made are listed below.
(1) Share split at a ratio of two shares per common share on May 20, 2005
(2) Share split at a ratio of 200 shares per common share on October 1, 2013(3) Share split at a ratio of five shares per common share on October 1, 20162) Status of share options, etc. delivered to employees, etc. during the business year under review
Not applicable.
3) Other important matters regarding share options, etc.
Not applicable.

- 28 -

(3) Matters regarding company officers (as of December 31, 2023)
1) Directors and company auditors
Position and duties

Name

Important positions held at other companies

Representative Director
Group President and Chief Koki Sato
Executive Officer

External Director, FOOD & LIFE COMPANIES LTD.

Director

Etsuko Okajima

CEO, ProNova Inc.
External Director, MARUI GROUP Co., Ltd.
External Director, LANCERS, Inc.
Outside Director, Yappli, Inc.
External Director, Money Forward, Inc.
Director, CHRO, Euglena Co., Ltd.

Director

Yusuke Asakura

Representative Director, Signifiant Inc.
Founding Partner, Animal Spirits Ltd.

Director

Yoshiki Ishikawa

Representative Director, Well-being for Planet Earth Foundation
Director, Cancer Scan Co., Ltd.
External Director, Gaiax Co. Ltd.

Akie Iriyama

Professor, Business School, Waseda University
External Director, ROHTO Pharmaceutical Co., Ltd.
Outside Director, Sanoh Industrial Co., Ltd.
Outside Director (Audit & Supervisory Committee Member),
SORACOM, INC.

Director

Mio Takaoka

Partner, DNX Ventures
Outside Director, HENNGE K.K.
Outside Director, Information Services International-Dentsu, Ltd.
(currently DENTSU SOKEN INC.)
Outside director (Audit & Supervisory Committee Member), KAYAC
Inc.

Director

Shuji Yamaguchi

Executive Officer, dentsu Japan, Dentsu Group Inc.
Managing Executive Officer, Dentsu Inc.

Director

Full-time Company Auditor Tadahiro Mouri
Company Auditor

Senior Partner, Trident Lawyer Corporation
Outside Director (Audit & Supervisory Committee Member), B-Lot
Mamoru FurushimaCompany Limited
Outside Audit & Supervisory Board Member, SECURE, INC.

Company Auditor

Takeshi Okuyama

Partner, Mori Hamada & Matsumoto2) Company auditors who resigned during the business year under review
Name
Nobuyuki Urata

Date of retirement
July 31, 2023

Reason for retirement

Position at the Company and important positionsat other companies at the time of retirement

Resignation

Company Auditor
Assistant to General Manager of Audit Office,
DENTSU CORPORATE ONE INC.

(Notes)
1. Directors Etsuko Okajima, Yusuke Asakura, Yoshiki Ishikawa, Akie Iriyama and Mio Takaoka are outside directors.
2. Company auditors Tadahiro Mouri, Mamoru Furushima and Takeshi Okuyama are outside company auditors.
3. Company auditor Mamoru Furushima is a certified public accountant and has a respectable degree of knowledge in financeand accounting.
4. The Company has designated directors Etsuko Okajima, Yusuke Asakura, Yoshiki Ishikawa, Akie Iriyama and Mio Takaoka
as independent officers in accordance with the rules of Tokyo Stock Exchange, Inc. and has submitted a notice of designation
to the Tokyo Stock Exchange.
5. The Company has entered into agreements with all outside directors and outside company auditors that limit their liability
for damages as set forth in Article 423, paragraph (1) of the Companies Act. The limit on liability for damages under said
agreement is ¥5 million or the minimum liability amount provided for by Article 425, paragraph (1) of the Companies Act,
whichever is higher.

- 29 -

6. The Company has entered into a directors and officers liability insurance policy (management risk protection insurance
policy) as provided for in Article 430-3, paragraph (1) of the Companies Act with an insurance company. The scope of
insureds in the insurance policy includes all directors, company auditors, and executive officers at the Company and all of
its subsidiaries, and the insureds will not bear the insurance premiums. This insurance policy covers amounts ofindemnification, litigation expenses and other costs that an insured would be liable for due to corporate litigation, a thirdparty lawsuit, a shareholder derivative lawsuit, etc. However, as a measure to ensure that the proper performance of duties
by an insured is not impaired, the insurance policy does not cover any damages, etc. arising from criminal acts, etc.
committed by the insured.

3) Remunerations, etc. to directors and company auditors(a) Policy for determining details of remunerations, etc. for officers
The Company adopted a resolution on the policy for determining details of individual remunerations,etc. for directors, etc. at the board of directors meeting held on November 22, 2016.
Furthermore, the board of directors has deemed that remuneration, etc. for individual directors in thebusiness year under review follow the determination policy. The board of directors has also confirmedthat performance evaluations including the approach to evaluating directors and their personalevaluation are reported to independent outside directors and they were decided while referencing theopinions of them, to confirm the method of determining the details of the remuneration, etc. and thedetails of the decided remuneration, etc. are consistent with the determination policy and the validityof remuneration levels.
The details of the policy for determining details of individual remunerations, etc. for directors, etc.
are as follows.
a. Basic policy
Remuneration for directors (excluding outside directors) is composed of basic remuneration(monthly cash remuneration) and performance-linked remuneration. The amount of basic
remuneration paid will be an amount that considers the rate of change in performance of thecontrolling company in the business year under review on top of the amount of remuneration paidin the previous business year. However, fixed upper and lower limits will be set in the
remuneration revisions. Furthermore, the total amount of remuneration paid as cash every monthmust be within the total remuneration limit for directors decided by the general meeting ofshareholders. Performance-linked remuneration will take the form of share-based remuneration
using the directors’ remuneration BIP trust.
Remuneration for outside directors is composed of only monthly basic remuneration (fixed withno changes based on performance).
Remuneration for company auditors is composed of only monthly basic remuneration (fixed withno changes based on performance).
b. Concerning other determination for remunerations, etc.
Following the above basic policy a., basic remuneration for directors (excluding outside directors)
will be within the total limit of director remuneration set by a resolution of the general meeting ofshareholders (Note 1), and individual and specific allocations will be decided by the Group
President and Chief Executive Officer referencing the opinions of outside directors. Regarding
performance-linked remuneration, based on the share-based remuneration system using thedirectors’ remuneration BIP trust resolved by the general meeting of shareholders, “share delivery
rules” will be concluded with the trustee of the trust (Note 2), and according to these rules, thetrustee will delivery shares and pay cash.
Following the above basic policy a., remuneration for outside directors will be within the total
limit of director remuneration set by a resolution of the general meeting of shareholders (Note 1),
and individual and specific allocations will be decided by the Group President and Chief Executive
Officer referencing the opinions of outside directors.
Following the above basic policy a., remuneration for company auditors will be within the total
limit of company auditor remuneration set by a resolution of the general meeting of shareholders(Note 3), and individual and specific allocations will be decided through discussions with the- 30 -

company auditors.
(Notes)
1. Up to ¥600 million per year for the Company’s directors (decided by a resolution at the 23rd Ordinary General Meeting of
Shareholders held on December 20, 2013).
2. Trust-related operations will be conducted by Mitsubishi UFJ Trust and Banking Corporation, etc. and share-related
operations will be conducted by DSB Co., Ltd.
3. Up to ¥50 million per year for the Company’s company auditors (decided by a resolution at the 9th Ordinary General
Meeting of Shareholders held on December 14, 1999).

(b) Total amount of remunerations, etc.
Total amount of remunerations, etc. by type
Category

Number ofpayeesTotal amount of officers’
remunerations, etc.

Basic
remuneration

Performance-linked
remuneration, etc.
Non-monetary remuneration, etc.

Director(of which Outside
Director)

6(5)¥261,066 thousand(¥90,000 thousand)¥254,670 thousand(¥90,000 thousand)¥6,396 thousand(¥– thousand)Company Auditor(of which Outside
Company Auditor)

3(3)¥30,000 thousand(¥30,000 thousand)¥30,000 thousand(¥30,000 thousand)¥– thousand(¥– thousand)(Notes)1. The number of payees does not include one director who serves without remuneration, one company auditor who served
without remuneration and retired at the conclusion of the 32nd Ordinary General Meeting of Shareholders held on December
21, 2022, and one company auditor who served without remuneration and resigned on July 31, 2023.
2. The Company is introducing a performance-linked share-based remuneration system using the directors’ remuneration BIP(Board Incentive Plan) trust scheme for directors of the Company (excluding outside directors and those who are nonresidents of Japan). Covenants, etc. at the time of allotments are provided in “(a) Policy for determining details of
remunerations, etc. for officers,” and the delivery status in the business year under review is provided in “2. (1) 5) Status ofshares delivered to the Company’s officers as remuneration for the execution of duties during the business year under review.”
3. The performance indicator associated with performance-linked remuneration, etc. is consolidated Non-GAAP operating
profit, and those results are provided in “1. (1) Business progress and results,” and “1. (2) Trends in financial position andprofit and loss.” As the reason for selecting this indicator, the Company has deemed that this is an appropriate indicator forevaluating the achievement of improvements to the medium- to long-term corporate value. In calculating performancelinked remuneration, basic points are allotted in a set period during each business year according to the role of each director
and the level of achievement, etc. of performance targets during the covered trust period of the directors’ remuneration BIP
trust. After the conclusion of the covered period, additional points allotted to persons covered by the system on the last dayof the final business year of the covered period are cumulatively added to the cumulative value of basic points (“Cumulative
Points”).
A number of the Company’s shares equal to the number of Cumulative Points is delivered or paid to persons covered by thesystem as share-based remuneration. Furthermore, 50% of the shares corresponding to the points in question (share of lessthan one unit rounded down) will be delivered as shares, and from the standpoint of securing funds to pay taxes, theremainder will be converted into cash, and cash corresponding to the amount converted to cash will be paid.
4. At the 23rd Ordinary General Meeting of Shareholders held on December 20, 2013, the amount of cash remuneration for
directors was set at up to ¥600 million annually (not including the portion of employee salaries paid to directors concurrently
serving as employees). The number of directors as of the conclusion of this ordinary general meeting of shareholders iseight.
Furthermore, in a separate framework from cash remuneration, at the 26th Ordinary General Meeting of Shareholders held
on December 20, 2016, the amount of trust funds provided to the trust as funds for the acquisition of the Company’ sharesassociated with the points allotted to directors (excluding outside directors and non-residents of Japan) as performancelinked share-based payments (directors’ remuneration BIP trust) was set at a maximum of ¥700 million, and the total points
at a maximum of 2,800,000 points (corresponding to 2,800,000 shares) for three business years. The number of directors asof the conclusion of this ordinary general meeting of shareholders (excluding outside directors and non-residents of Japan)
is six.
At the 32nd Ordinary General Meeting of Shareholders held on December 21, 2022, resolutions were passed to extend thetrust period until May 31, 2026, and in conjunction with the change in the Company’s fiscal year-end, to continue with theplan under a new version in which some details were revised. The number of directors as of the conclusion of this ordinary
general meeting of shareholders (excluding outside directors and non-residents of Japan) is two.
5. The amount of cash remuneration for company auditors was set at a maximum of ¥50 million annually at the 9th Ordinary
General Meeting of Shareholders held on December 14, 1999. The number of company auditors as of the conclusion of thisordinary general meeting of shareholders is one.
6. The board of directors has delegated the decisions on the amounts of individual director remuneration to Koki Sato,
Representative Director, Group President and Chief Executive Officer. The reason for the delegation is that the board of- 31 -

directors deemed that the Representative Director, Group President and Chief Executive Officer is best suited to conduct
evaluations of the division for which each director is responsible while considering the Company’s overall performance,
etc. The board of directors has also reported to independent outside directors on performance evaluations including theapproach to evaluating directors and their personal evaluation to confirm the validity of remuneration levels, and decides
remuneration levels while referencing the opinions of independent outside directors.

4) Outside officers(a) Relationships between the Company and other companies where outside officers hold important
positionsCategory

Name

Important positions held at other companies

Relationship with the Company

CEO, ProNova Inc.

There is no business relationship.

External Director, MARUI GROUP Co., Ltd. There is no business relationship.
Director

Director

Director

Etsuko Okajima

Yusuke Asakura

Yoshiki Ishikawa

External Director, LANCERS, Inc.

There is no business relationship.

Outside Director, Yappli, Inc.

There is no business relationship.

External Director, Money Forward, Inc.

There is no business relationship.

Director, CHRO, Euglena Co., Ltd.

There is no business relationship.

Representative Director, Signifiant Inc.

There is no business relationship.

Founding Partner, Animal Spirits Ltd.

The Company has invested in
Animal Spirits No. 1 Investment
Business Limited Partnership,
which is operated by Animal
Spirits No. 1 Limited Liability
Partnership, of which Animal
Spirits Ltd. is a partner, as anunlimited liability partner. The
amount of the investment is lessthan 0.09% of the total assets of theCompany as of the end of the fiscal
year under review.

Representative Director,
Planet Earth Foundation

Well-beingfor

Director, Cancer Scan Co., Ltd.

There is no business relationship.

External Director, Gaiax Co. Ltd.
Professor,
University
Director

Akie Iriyama

Business

School,There is no business relationship.

There is no business relationship.
WasedaThere is no business relationship.

External Director, ROHTO Pharmaceutical
There is no business relationship.
Co., Ltd.
Outside Director, Sanoh Industrial Co., Ltd.

There is no business relationship.

Outside Director (Audit & Supervisory
There is no business relationship.
Committee Member), SORACOM, INC.

Director

Mio Takaoka

Partner, DNX Ventures

There is no business relationship.

Outside Director, HENNGE K.K.

There is no business relationship.

Outside Director, Information Services
International-Dentsu,
Ltd.
(currently There is no business relationship.
DENTSU SOKEN INC.)
Outside director (Audit & Supervisory
There is no business relationship.
Committee Member), KAYAC Inc.

Company Auditor Tadahiro Mouri

Company Auditor Mamoru Furushima

None.

There is no business relationship.

Senior Partner, Trident Lawyer Corporation

There is no business relationship.

Outside Director (Audit & Supervisory
Committee Member), B-Lot Company There is no business relationship.
LimitedOutside Audit & Supervisory Board Member,
There is no business relationship.
SECURE, INC.

Company Auditor Takeshi Okuyama

Partner, Mori Hamada & Matsumoto- 32 -

There is no business relationship.

(b) Outline of major activities and duties carried out in relation to expected roles in the business year
under review
Category

Director

Director

Director

Director

Director

Name

Outline of major activities and duties carried out in relation to expected roles

Etsuko Okajima

Ms. Okajima attended all board of directors meetings held during the businessyear under review, where she made comments primarily informed by her
experience and insight as a corporate manager. Moreover, as the chairperson of
the Nomination and Remuneration Advisory Committee, which is a voluntary
advisory organization of the Company, she has led deliberations on nomination of
directors, etc. and compiled proposed recommendations as the committee. She has
also exchanged information and shared understanding on the Group’s
management, the board of directors’ activities, and the successor development
plan for managers, etc. in regular executive sessions composed of independent
outside directors held monthly.

Yusuke Asakura

Mr. Asakura attended all board of directors meetings held during the business year
under review, where he made comments primarily from his professional
viewpoints as a corporate manager, as a researcher and as an investor. Moreover,he has expressed opinions appropriately as a member of the Nomination andRemuneration Advisory Committee, which is a voluntary advisory organization of
the Company. He has also exchanged information and shared understanding on
the Group’s management, the board of directors’ activities, and the successor
development plan for managers, etc. in regular executive sessions composed ofindependent outside directors held monthly.

Yoshiki Ishikawa

Mr. Ishikawa attended all board of directors meetings held during the businessyear under review, where he made comments primarily from his professional
viewpoints as a preventive medicine researcher and as a founder of a company
using methods based on behavioral science. Moreover, he has expressed opinions
appropriately as a member of the Nomination and Remuneration Advisory
Committee, which is a voluntary advisory organization of the Company. He has
also exchanged information and shared understanding on the Group’s
management, the board of directors’ activities, and the successor development
plan for managers, etc. in regular executive sessions composed of independent
outside directors held monthly.

Akie Iriyama

Mr. Iriyama attended all board of directors meetings held during the business year
under review, where he made comments primarily from his operational experience
as a consultant, along with professional, extensive experience and results andconsiderable insight as a researcher specialized in management strategies and theglobal management field. Moreover, he has expressed opinions appropriately as amember of the Nomination and Remuneration Advisory Committee, which is avoluntary advisory organization of the Company. He has also exchanged
information and shared understanding on the Group’s management, the board of
directors’ activities, and the successor development plan for managers, etc. inregular executive sessions composed of independent outside directors held
monthly.

Mio Takaoka

Ms. Takaoka attended all board of directors meetings held during the businessyear under review, where she made comments primarily from her professional,
extensive experience and results and considerable insight of strategic investment,
new business development and finance. Moreover, she has expressed opinions
appropriately as a member of the Nomination and Remuneration Advisory
Committee, which is a voluntary advisory organization of the Company. She has
also exchanged information and shared understanding on the Group’s
management, the board of directors’ activities, and the successor development
plan for managers, etc. in regular executive sessions composed of independent
outside directors held monthly.

Company Auditor Tadahiro Mouri

Mr. Mouri attended all board of directors meetings and all board of company
auditors meetings held during the business year under review, where he madecomments primarily from his considerable insight and extensive operational
experience of auditing. He has also collaborated with and exchanged information
with outside officers by participating in regular executive sessions composed ofindependent outside directors and the Nomination and Remuneration Advisory
Committee meetings.

- 33 -

Category

Name

Outline of major activities and duties carried out in relation to expected roles

Mr. Furushima attended all board of directors meetings and all board of company
auditors meetings held during the business year under review, where he madecomments primarily from his professional viewpoints as a certified publicCompany Auditor Mamoru Furushima accountant and as a lawyer. He has also collaborated with and exchanged
information with outside officers by participating in regular executive sessions
composed of independent outside directors and the Nomination and Remuneration
Advisory Committee meetings.

Company Auditor Takeshi Okuyama

Note

Mr. Okuyama attended 18 of 19 board of directors meetings and 16 of 17 board ofcompany auditors meetings held in business year under review, where he madecomments primarily from his professional viewpoints as a lawyer. He has alsocollaborated with and exchanged information with outside officers byparticipating in regular executive sessions composed of independent outside
directors and the Nomination and Remuneration Advisory Committee meetings.

As described in “Issues to be addressed” (page 23), the inappropriate use of expenses by the Company’s
Representative Director was discovered during the current fiscal year. However, the above eight outside officers
have always been providing advice and recommendations to ensure the appropriateness of the execution of duties bydirectors through the board of directors (and the board of directors and board of company auditors for the outsidecompany auditors). After the aforementioned inappropriate use was discovered, the eight outside officers maderecommendations and confirmed measures to prevent recurrence through an investigation undertaken by the board ofcompany auditors.

(4) Financial auditor (as of December 31, 2023)
1) Name
KPMG AZSA LLC
2) Amount of remuneration, etc.
(a) Remuneration for audit services set forth in Article 2, paragraph (1) of the Certificated Public
Accountants Act to be paid by the Company¥87,200 thousand(b) Total amount of cash and other economic benefits to be paid to the financial auditor by the Company
and its subsidiaries¥89,996 thousand(Notes)1. The audit contract between the Company and the financial auditor does not distinguish between remuneration paid for theaudit conducted in accordance with the Companies Act and remuneration paid for the audit conducted in accordance with
the Financial Instruments and Exchange Act. Accordingly, the amount above is the aggregate amount.
2. The Company and its subsidiaries entrust the financial auditor with advisory, guidance and other services related to finance,
which are non-audit services other than the services set forth in Article 2, paragraph (1) of the Certificated Public
Accountants Act, and duly pays consideration for such services.
3. The board of company auditors, based upon the “Practical Guidelines for Cooperation with Financial Auditors” released by
the Japan Audit & Supervisory Board Members Association, conducts confirmation of the auditing plans of the financial
auditor, the status of execution of audit, the grounds for calculation of remuneration estimates and other matters, and having
investigated these, gives consent to remuneration, etc. for the financial auditor in accordance with Article 399, paragraph(1) of the Companies Act.

3) Details of limited liability agreement
Not applicable.
4) Policy for determining of the dismissal or non-reappointment of financial auditor
In the event that there is an obstacle to the execution of duties by the financial auditor, or whenotherwise deeming the action necessary, the board of company auditors will determine the content ofan agenda to be proposed to the General Meeting of Shareholders regarding the dismissal or nonreappointment of the financial auditor. In addition, when any of the matters prescribed in the items in
Article 340, paragraph (1) of the Companies Act are applicable to the financial auditor, the board ofcompany auditors will dismiss the financial auditor with the unanimous consent of the company
auditors.

- 34 -

5) Business suspension order to which the financial auditor was subjected during the past two years
Nothing noteworthy to report.

- 35 -

3. Structure and policy of the Company(1) Policy regarding the determination of dividends of surplus, etc.
Regarding the dividends of surplus, in consideration of our consolidated earnings performance of eachfiscal year, the strengthening of our financial position, the Group’s business strategy going forward andother factors, we endeavor to return profits to shareholders within the range of our distributable amount,with a target dividend payout ratio of around 25% to profit attributable to owners of parent.
Furthermore, by setting a minimum annual dividend per share of ¥3 in principle, we will consider thecontinuity and stability of dividends, while basing on appropriate profit distribution in line with businessgrowth.
In addition, we will endeavor to utilize our internal reserves for investments in training personnel,
optimizing and reinvigorating our existing businesses, and capturing new business areas that have thepotential for high growth and profitability.
We intend to acquire own shares on an ongoing basis by comprehensively taking into account market
conditions, opportunities to invest in businesses, capital efficiency, the level of share price, etc. and to
implement such share repurchases in a flexible manner.
The Articles of Incorporation of the Company stipulate that the Company may determine dividends ofsurplus, etc. by a resolution of the board of directors pursuant to the provisions Article 459, paragraph(1) of the Companies Act. However, since the business year under review is a 15-month period due toa change in the Company’s fiscal year-end, the year-end dividends for the fiscal year under review isdetermined by the general meeting of shareholders. The Company plans to pay a year-end dividend of¥5.2 per share for the business year under review.
(2) Systems to ensure the properness of operations
1) Systems to ensure the properness of operations of the corporate group comprised of the Company andits subsidiaries(a) The corporate group comprised of the Company and its subsidiaries (hereinafter referred to as the“Group”) is managed under a holding company structure in which the Company is a holding
company and its subsidiaries are operating companies. By separating the managerial function fromthe function of executing its individual businesses, the Group shall work to facilitate the delegationof authority to its operating subsidiaries and strengthen the Company’s function of monitoring theGroup’s businesses.
(b) The Company’s function of managing the business of its operating subsidiaries shall be implemented
effectively and efficiently based on the execution of its direct and indirect shareholders’ rights andunder the “Basic Agreement on Business Management Services for the Group” entered into with theoperating subsidiaries.
(c) The Company shall establish principles, regulations, guidelines and others common to the Group to
ensure efficient and proper execution of duties by the Group’s directors, Group Executive Officers
and employees (hereinafter referred to as “officers and employees”).
(d) The Company shall clarify a system for reporting any situations concerning execution of duties by
the Group’s officers and employees such as the state of the business and financial results to theCompany’s board of directors or the Group Management Meeting. In cases where certain significant
decisions are made, prior approval of the Company’s board of directors or the Group Management
Meeting shall be required.
(e) The Internal Auditing Office of the Company shall provide assurance operations (auditing andguarantee function) and consulting operations (advisory and guidance function) from an independentand objective position to the Group, and examine and assess the status of ensuring the properness ofoperations of the entire Group.
2) Systems to ensure compliance with laws and regulations and the Articles of Incorporation by directors
and employees when executing their duties(a) Officers and employees of the Group shall recognize compliance with laws and regulations and social
ethics as being one of basic points for the Group to fulfill its corporate social responsibilities, improve- 36 -

corporate value and achieve sustainable growth, and practice the compliance through the Group’s
sustainability activities.
(b) The Group’s corporate philosophy and code of conduct shall call for compliance with laws andregulations and social ethics and adopt it as the Group’s basic policy for the business operation.
(c) Directors and Group Executive Officers of the Group shall practice and encourage the compliancewith laws and regulations and social ethics proactively.
(d) Directors and Group Executive Officers shall assign authorities for execution of duties appropriately
and clearly and execute the duties in accordance with regulations including the regulations of theboard of directors and the regulations of the Executive Officers.
(e) In the event that directors and Group Executive Officers find a violation of laws and regulations orother important facts regarding compliance, they shall report to the Company’s board of directors or
the Group Management Meeting without delay and take corrective measures.
(f) The Company shall conduct regular compliance trainings for the Group’s officers and employees
continuously and have the Internal Auditing Office, which is directly under Group President andChief Executive Officer, perform internal audits of the Group.
(g) In order to respond appropriately to reporting or consultation from the Group’s officers andemployees on organizational or individual violations of laws and regulations, detect and amend
inappropriate actions and others early, and strengthen the compliance, the Company shall establish awhistleblower hotline with external lawyers being as the person who directly receives a report.
3) Systems for the storage and management of information regarding the execution of duties by directors(a) With regard to information security of the Group, the Company shall set the “Basic Policy on
Information Security,” develop internal regulations regarding information security in line with laws
and regulations, and establish the “Security Management Office” to oversee and manage information
security in an integrated and effective manner under the common policy as the Group.
(b) With regard to documents, forms and other records related to duties of the Group’s officers andemployees (including electromagnetic records), the Company shall develop internal regulations
regarding document management in line with laws and regulations, and manage and store such
documents in an integrated and effective manner under the common policy as the Group.
(c) With regard to personal information management of the Group, the Company shall establish “Privacy
Policy,” develop internal regulations regarding personal information security in line with laws andregulations, and manage such information in an integrated and effective manner under the common
policy as the Group.
(d) With regard to documents, forms and other records related to duties of the Group’s officers andemployees (including electromagnetic records), the Company shall establish a system to ensure that
directors and company auditors can have access to these records at any time.
(e) With regard to insider information on shares of listed companies, the Company shall establish the“Group Regulations on Prevention of Insider Trading,” manage such information in an integrated
and effective manner under the common policy as the Group, and communicate it to the division in
charge of information disclosure appropriately.
(f) When storing and managing information through electromagnetic records, the Company shall strive
to gather the up-to-date information on threats for electronic information to build the latest system
for storage and management possible.
4) Regulations and other systems for managing the risk of loss(a) In order to recognize significant events that may affect the business management of the Group,
identify, analyze and assess risks that may harm the development and growth of the business, andmake responses to the risks such as risk aversion, mitigation, transfer and others, the Company shallestablish the “Group Risk Management Regulations” and set up the “Group Risk Management
Committee” as a body to oversee and manage such risks in an integrated and effective manner under
the common policy as the Group.

- 37 -

(b) With regard to usual risk management of the Group, each operating subsidiary or division shall makea risk assessment and response to the risk, and the Group Risk Management Committee shall receivea report from the operating subsidiary or division and oversee the risk management of the Group.
(c) In case of an emergency, the “Crisis Management Headquarters” with the Group President and Chief
Executive Officer as its head shall oversee the risk management of the Group.
(d) Risk management policies of the entire Group as well as assessment of and responses to the risks
related to strategic decision-making such as management strategy and merger and acquisition shallbe treated as the exclusive prerogatives of the Company’s board of directors. In making thesemanagement decisions, the Company shall assess the risks appropriately.
(e) The Company shall establish a reporting system for any event or indication that may affect the Groupsignificantly in cases where risks have become apparent, so that its board of directors can figure out
such an event or indication in advance.
5) Systems to ensure the efficient execution of duties by directors(a) The Company’s board of directors shall make decisions on matters stipulated in laws and regulations
and the Articles of Incorporation and the execution of important operations, and transfer its authority
to Group Executive Officers with regard to the execution of other operations pursuant to the“regulations of the board of directors” and the “Resolution and Entrustment Criteria” to ensureswiftness and efficiency of the execution of duties.
(b) Multiple subsidiary groups that are part of the same chain of command in the Group shall be deemed
as companies without board of directors in terms of institutional design under the Companies Act inorder to promote the swiftness and efficiency of the decision-making process. Their information shallbe consolidated by the Company’s board of directors or the management meeting of the coresubsidiary to uniform the decision-making process.
(c) Directors and Group Executive Officers shall execute duties efficiently based on the Medium-TermBusiness Policies and goals and annual budget set by the Company’s board of directors, as well asreport the progress of these policies and goals and budget to the Company’s board of directors or theGroup Management Meeting and implement necessary improvement measures.
(d) In cases where subsidiaries make significant decisions, approval of the Company’s board of directors
or the Group Management Meeting shall be required, and coordination shall be made for the efficient
resource allocation avoiding overlaps of business activities and capital investments between the
Company and subsidiaries or between subsidiaries.
6) Matters relating to employees that assist the company auditors upon the request of such company
auditors, independence of the relevant employees from directors and effectiveness of directions given
to such employees of the company auditors to be ensured(a) Employees that assist the company auditors shall be assigned at the request of company auditors.
(b) Employees that assist the company auditors shall not concurrently serve other duties and posts.
(c) Matters related to personnel evaluations, personnel transfers, disciplinary actions, etc. for employeesthat assist the company auditors shall be conducted separately from the other employees anddetermined with the consent of the company auditors.
7) Systems for enabling directors and employees to make reports to company auditors and systems for
ensuring that the persons who made such reports shall not be treated disadvantageously on the grounds
that they have submitted the said reports(a) Company auditors of the Company may attend the board of directors meetings of the Company,
Group Management Meeting and other important meetings, and request explanations from officers
and employees as necessary.
(b) In cases where company auditors request reports on operations or inspections of documents such as
minutes, approval documents and accounting books, officers and employees of the Group shall
respond to the request in a prompt and appropriate manner.

- 38 -

(c) In the event that officers and employees of the Group detect any facts or situations that may causesignificant damage to the companies, such officers and employees shall immediately report thematters to company auditors.
(d) The Company shall establish regulations for prohibiting removal from duty, discharge and any otherdisadvantageous treatment to officers and employees of the Group on the grounds that the officers
and employees made a report to company auditors, and make the regulations well known.
(e) All of the internal audit reports conducted by the Internal Auditing Office shall be reported to theboard of company auditors.
8) Matters relating to policies on procedures for prepayment or reimbursement of expenses arising fromthe execution of duties by company auditors and processing of other expenses or obligations arisingfrom the execution of duties by company auditors
Expenses that are considered necessary in the execution of duties of company auditors shall bebudgeted in advance. In cases where company auditors request payment for reasonable expenses forthe execution of their duties, the Company shall accept the request.
9) Systems for ensuring the effective functioning of audits by company auditors(a) The Company shall ensure that it provides its company auditors with opportunities to sufficiently
exchange opinions with the Group President and Chief Executive Officer, outside directors, financial
auditor and internal auditors.
(b) The Company shall establish a system that allows its company auditors to perform audits equivalent
to audits of the Company by the company auditors under individual agreements between the
Company and its subsidiaries, in addition to investigations of subsidiaries under laws and regulations,so that the company auditors can audit the entire Group effectively and efficiently as needed.
(3) Overview of status of management of systems to ensure the properness of operations
1) Information on compliance and risk management
With regard to the status of compliance and risk management among the entire Group, the Company
shall regularly hold the meeting of the Group Risk Management Committee and share the information
relating to the correspondence status, etc.
Regular compliance trainings for officers and employees have been provided to raise the employee’s
awareness on compliance. In addition, the Company established the internal reporting system for theGroup and informed all employees about it.
2) Information on the execution of duties by directors
The board of directors comprises seven directors, including five outside directors. In addition, threecompany auditors including three outside company auditors also attend the meetings of the board of
directors. During the business year under review, the board of directors held meetings 19 times to ensure
the execution of duties in compliance with laws and regulations and the Articles of Incorporation bymeans of the managerial decision-making through full and thorough discussions and other measures.
3) Information on the execution of duties by company auditors
The board of company auditors comprises three company auditors, including three outside company
auditors. During the business year under review, the board of company auditors held meetings 17 times
to mainly receive reports from full-time company auditor on the status of operations of the Company
and exchange opinions mutually among company auditors.
In addition to that, company auditors shall provide supervision of execution of duties by directors byattending the important meetings including the meeting of the board of directors and GroupManagement Meeting, and regularly exchange information with the Group President and Chief
Executive Officer, financial auditor and Internal Auditing Office.
(Note) Figures in this Business Report are rounded to the nearest unit.

- 39 -

Consolidated Financial Statements
Consolidated Statement of Financial Position(Thousand yen)Account
AssetsCurrent assets
Cash and cash equivalents
Trade receivables

33rd term(As ofDecember31, 2023)(Reference)
32nd term(As of
September 30,
2022)

33rd term(As ofDecember31, 2023)(Reference)
32nd term(As of
September 30,
2022)

19,031,397

16,891,357

4,414,965

4,910,042

421,9292,227,759

557,879
2,847,110

Subtotal
Liabilities directly
associated with assets
held for sale

26,096,050

25,206,388

236,525–

Total current liabilities
Non-current liabilities
Other financial
liabilities
Provisions
Deferred tax liabilities

26,332,575

25,206,388

1,369,940

531,226

152,549
46,137

159,063
80,366

Total non-current
liabilities

1,568,627

770,655

Account
Liabilities and Equity
Liabilities
Current liabilities
Trade payables
Other financial
liabilities
Income taxes payable
Other current liabilities

20,873,416
19,830,799

21,340,076
18,285,273

72,849103,154

Other financial assets
Other current assets

101,550
1,997,253

98,953757,815

Subtotal

42,875,867

40,585,272

Assets held for sale

807,491–

Total current assets
Non-current assets
Property, plant andequipment
Right-of-use assets
Goodwill

43,683,358

40,585,272

257,486

235,022

1,899,500
4,693,055

1,090,965
4,693,055

Intangible assets

432,366

525,138

34,249,351

33,342,226

Total liabilities

27,901,201

25,977,043

7,106,364

6,904,527

13,26024,244

Deferred tax assets

1,271,250

1,330,663

EquityEquity attributable toowners of parent
Share capital

18,428,004

18,428,004

Total non-current assets

49,922,632

48,145,841

25,426,993(1,396,624)
23,185,222

25,309,728(575,707)
19,671,818(49,731)(128,588)

65,593,864

62,705,254

110,925
65,704,788

48,81562,754,069

93,605,990

88,731,112

Inventories

Investments accounted forusing equity method
Other financial assets
Other non-current assets

Capital surplus
Treasury shares
Retained earnings
Other components ofequityTotal equity attributableto owners of parent
Non-controlling interests
Total equity

Total assets

93,605,990

88,731,112

Total liabilities and equity(Note) Figures are rounded to the nearest unit.

- 40 -

Consolidated Statement of Profit or Loss
33rd term(From October 1, 2022
to December 31, 2023)

Account(Thousand yen)
(Reference)
32nd term(From October 1, 2021
to September 30, 2022)

Continuing operations
Revenue
Cost of sales

34,266,611
6,799,214

27,589,386
5,023,904

Gross profit
Selling, general and administrative expenses
Other income
Other expenses

27,467,397
22,499,702
66,17384,73422,565,482
16,176,779
23,314
246,238

Operating profit
Finance income
Finance costs
Share of profit of investments accounted for using equity
method4,949,134
5,760
153,485

6,165,779
2,068,952
334,594

1,850,739

1,066,228

Profit before tax
Income tax expense

6,652,148
1,727,766

8,966,365
2,659,861

Profit from continuing operations
Discontinued operations
Loss from discontinued operations

4,924,381

6,306,504(657,107)(555,831)

Profit

4,267,275

5,750,673

Profit attributable to:
Owners of parent
Non-controlling interests

4,318,831(51,556)

5,733,564
17,109Total

4,267,275

5,750,673(Note) Figures are rounded to the nearest unit.

- 41 -

(Reference) Consolidated Statement of Comprehensive Income

Account
ProfitOther comprehensive income
Items that will not be reclassified to profit or loss
Net changes in financial assets measured at fair value
through other comprehensive income
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Cash flow hedges
Share of other comprehensive income of investments
accounted for using equity method
Total other comprehensive income, net of tax

33rd term(From October 1, 2022
to December 31, 2023)
4,267,275(Thousand yen)
32nd term(From October 1, 2021
to September 30, 2022)
5,750,673

201,646

25,05528,097
2,990

114,591
8,356

3,664

–

236,397

148,001

Total comprehensive income

4,503,672

5,898,674

Comprehensive income attributable to:
Owners of parent
Non-controlling interests

4,555,228(51,556)

5,881,565
17,109Comprehensive income

4,503,672

5,898,674(Note) Figures are rounded to the nearest unit.

- 42 -

Consolidated Statement of Changes in Equity
33rd term (From October 1, 2022 to December 31, 2023)(Thousand yen)
Equity attributable to owners of parent
Share capital

Capitalsurplus18,428,004

25,309,728

–
–

–
–

–
–

Total comprehensive
income–––Dividends of surplus
Purchase of treasury
shares
Disposal of treasury
sharesChanges without lossof control ofsubsidiaries
Other

–
–

–

–

(2,506)(1,275,942)(455,025)

455,025–

542,167–

Total transactions
with owners–

Balance at October 1,
2022
ProfitOther comprehensive
incomeBalance at December
31, 2023–

18,428,004

TreasurysharesRetainedearnings(575,707) 19,671,818

Othercomponentsof equity

Total(128,588) 62,705,254

Noncontrollinginterests

Total equity

48,81562,754,069

4,318,831–

4,318,831(51,556)

4,267,275–

236,397

236,397–

236,397

4,318,831

236,397

4,555,228(51,556)

4,503,672(962,966)–––(962,966)––(962,966)

–

–

–

–

–

542,167

115,350

657,516

32,629–157,539(157,539)

32,629(1,684)30,945

117,265(820,917)(805,426)(157,539)(1,666,618)

113,665(1,552,953)(49,731) 65,593,864

110,925

65,704,788

25,426,993(1,396,624) 23,185,222(1,278,448)–(1,278,448)––(Reference) 32nd term (From October 1, 2021 to September 30, 2022)(Thousand yen)
Equity attributable to owners of parent
Share capital

CapitalsurplusTreasuryshares2,125,384

3,901,272(1,691,842) 14,322,283

–
–

–
–

–
–

–

–

–

16,302,620

16,161,638

Dividends of surplus––

Purchase of treasury
shares–––5,102,147

Balance at October 1,
2021
ProfitOther comprehensive
incomeTotal comprehensive
incomeIssuance of newsharesObtaining of controlof subsidiaries
Other

Retainedearnings

Total(230,678) 18,426,419

Noncontrollinginterests

Total equity

18,86918,445,288

5,733,564–

5,733,564

17,1095,750,673–

148,001

148,001–

148,001

5,733,564

148,001

5,881,565

17,1095,898,674

–
–

Other
componentsof equity––

32,464,257

–

–

–

1,116,161––

6,218,308

14,9026,233,210(45,911)

144,671(2,064)

142,606(26)–

32,464,257(429,940)(26)(429,940)––(429,940)(26)–

144,671–

45,911

Total transactions
with owners

16,302,620

21,408,456

1,116,135(384,029)(45,911) 38,397,270

12,83838,410,107

Balance at September
30, 2022

18,428,004

25,309,728(575,707) 19,671,818(128,588) 62,705,254

48,81562,754,069(Note) Figures are rounded to the nearest unit.

- 43 -

Non-consolidated Financial Statements
Non-consolidated Balance Sheet

Account

33rd term(As of December 31,
2023)

AssetsCurrent assets
Cash and deposits
Accounts receivable - trade

Account(Thousand yen)
33rd term(As of December 31,
2023)

Liabilities
11,417,405

Current liabilities

2,395,622

9,080,380

Short-term borrowings

2,000,000

517,254

Accounts payable - other

182,089

Accrued expenses

28,866

Supplies

1,407

Prepaid expenses

288,631

Income taxes payable

85,218

Accounts receivable - other

253,091

Deposits received

17,818

Income taxes receivable

1,069,774

Provision for bonuses

25,970Other55,660

Short-term loans receivable fromsubsidiaries and associates

290,000

Allowance for doubtful accounts(83,134)

Non-current assets

48,106,905

Total liabilities

2,395,622

Net Assets

Property, plant and equipment

123,425

Shareholders’ equity

56,962,821

Buildings

36,814

Share capital

18,428,003

Tools, furniture and fixtures

83,836

Capital surplus

24,125,671

Other

2,774

Legal capital surplus

18,836,552

Intangible assets

25,412Other capital surplus

5,289,119

Software24,784Retained earnings

15,805,770

Other

627

Legal retained earnings

70,867

Investments and other assets

47,958,067

Other retained earnings

15,734,903

Investment securities

4,838,487

General reserve

41,441,179

Retained earnings brought
forward

Shares of subsidiaries andassociates
Long-term loans receivable fromsubsidiaries and associates
Leasehold and guarantee deposits
Deferred tax assets
Other
Allowance for doubtful accounts
Total assets

400,000
15,334,903

200,000

Treasury shares

512,822

Valuation and translation
adjustments

165,866

Valuation difference on availablefor-sale securities

165,866

44,915
1,012,947(92,283)
59,524,310(1,396,623)

Total net assets

57,128,688

Total liabilities and net assets

59,524,310(Note) Figures are rounded down to the nearest unit.

- 44 -

Non-consolidated Statement of Income(Thousand yen)
33rd term(From October 1, 2022
to December 31, 2023)
6,853,704
3,492,563

Account
Operating revenue
Operating expenses
Operating profit
Non-operating income
Interest income
Dividend income
Gain on valuation of investment securities
Other

3,361,141
2,618,669
3,183
1,855,767
740,604
19,113Non-operating expenses
Interest expenses
Loss on valuation of investment securities
Listing expenses
Commission expenses
Other856,611
13,434
783,305
15,561
43,722587

Ordinary profit
Extraordinary income
Gain on sales of investment securities

5,123,199
294,291
294,291

Extraordinary losses
Loss on valuation of shares of subsidiaries and associates
Loss on valuation of investment securities
Provision of allowance for doubtful accounts for subsidiaries and associates
Other

426,316
42,457
267,115
116,087
656

Profit before income taxes
Income taxes - current
Income taxes - deferred

4,991,174
99,40964,772

Profit4,826,991(Note) Figures are rounded down to the nearest unit.

- 45 -

Non-consolidated Statement of Changes in Equity
33rd term (From October 1, 2022 to December 31, 2023)(Thousand yen)
Capital surplus
Share capital Legal capital Other capital Total capitalsurplussurplussurplus
Balance at
beginning of
18,428,003 18,836,552
periodChanges during
periodDividends of––surplusProfit––Purchase of––treasury shares
Disposal of––treasury shares
Net changes in
items other than––shareholders’equityTotal changes––
during period
Balance at end of
18,428,003 18,836,552
period5,289,119 24,125,671

Shareholders’ equity
Retained earnings
Other retained earnings
Legal
Retainedretained
Generalearnings
earnings
reservebrought
forward70,867

Valuation and translation adjustments

Total
retainedearnings

400,000 11,478,877 11,949,744

Valuation
DeferredTotal
difference on
Treasurygains orshareholders’ availableshareslosses onequityfor-salehedgessecurities(575,706) 53,927,712

57,714(2,990)Total
valuationandtranslation
adjustments

Total net
assets54,724 53,982,437

–

–

–

–

(970,966)(970,966)–(970,966)–––(970,966)

–

–

–

–

4,826,991

4,826,991–

4,826,991–––

4,826,991

–

–

–

–

–

–

(1,275,942) (1,275,942)

–

–

–

(1,275,942)

–

–

–

–

–

–

455,025

455,025–––

455,025

–

–

–

–

–

–

–

–

108,151

2,990

111,141

111,141

–

–

–

–

3,856,025

3,856,025(820,917)

3,035,108

108,151

2,990

111,141

3,146,250

5,289,119 24,125,671

70,867(1,396,623) 56,962,821

165,866–

400,000 15,334,903 15,805,770(Note) Figures are rounded down to the nearest unit.

- 46 -

165,866 57,128,688

Board of Company Auditors’ Report

Audit Report
With respect to the directors’ performance of their duties during the 33rd business year from October 1, 2022
to December 31, 2023, the board of company auditors has prepared this audit report after deliberations basedon the audit reports prepared by each of the company auditors, and hereby reports as follows:
1. Method and Contents of Audit by the Company Auditors and the Board of Company Auditors(1) The board of company auditors has established the audit policies, allocation of duties, etc. and received
a report from each of the company auditors regarding the status of implementation of their audits andresults thereof. In addition, the board of company auditors has received reports from the directors, etc.,
and the financial auditor regarding the status of performance of their duties, and requested explanations
as necessary.
(2) In conformity with the audit regulations for company auditors established by the board of company
auditors, and in accordance with the audit policies and allocation of duties, etc., and while utilizing theInternet and other means, each of the company auditors endeavored to facilitate a mutual understanding
with the directors, the Internal Audit Division and other employees, etc., endeavored to collectinformation, maintain and improve the audit environment, and conducted the audits based on themethods described below.
1) Each of the company auditors has attended the meetings of the board of directors and other important
meetings, received reports on the status of performance of duties from the directors and employees,
etc., and requested explanations as necessary, examined important approval/decision documents, andinspected the status of the corporate affairs and assets. Also, with respect to the subsidiaries, each of
the company auditors endeavored to facilitate a mutual understanding and exchanged information withthe directors and company auditors, etc. of each subsidiary and received from subsidiaries reports on
their respective business as necessary.
2) Each of the company auditors monitored and inspected the contents of the board of directors’
resolutions regarding the development and maintenance of the systems to ensure compliance with laws
and regulations and the Articles of Incorporation by directors when executing their duties stated in theBusiness Report and other systems that are set forth in Article 100, paragraphs (1) and (3) of theRegulation for Enforcement of the Companies Act as being necessary for ensuring the appropriatenessof the corporate affairs of the corporate group comprised of a stock company and its subsidiaries, andthe status of the establishment and operation of the systems (internal control systems) based on such
resolutions. With respect to the internal control related to the financial report, the board of company
auditors received reports regarding the assessment and status of their audits from the directors, etc.
and KPMG AZSA LLC, and also requested explanations when necessary.
3) Each of the company auditors monitored and verified whether the financial auditor maintained its
independence and properly conducted its audit, received a report from the financial auditor on thestatus of its performance of duties, and requested explanations as necessary. Each of the company
auditors was notified by the financial auditor that it had established a “system to ensure that the duties
are performed appropriately” (the matters listed in the items of Article 131 of the Regulation on
Corporate Accounting) in accordance with the “Quality Management Standards Regarding Audits”(Business Accounting Council, October 28, 2005), and requested explanations as necessary.
Based on the above-described methods, each of the company auditors examined the Business Report and the
supplementary schedules, the Non-consolidated Financial Statements (Non-consolidated Balance Sheet,
Non-consolidated Statement of Income, Non-consolidated Statement of Changes in Equity and Notes to Nonconsolidated Financial Statements) and the supplementary schedules thereof, as well as the Consolidated
Financial Statements (Consolidated Statement of Financial Position, Consolidated Statement of Profit or Loss,
Consolidated Statement of Changes in Equity and Notes to Consolidated Financial Statements, all preparedby omitting some disclosure items required under IFRS as provided for by Article 120, the latter part ofparagraph (1) of the Regulation on Corporate Accounting), for the business year under review.

- 47 -

2. Results of Audit(1) Results of audit of Business Report, etc.
1) We acknowledge that the Business Report and the supplementary schedules thereof fairly present thestatus of the Company in conformity with the applicable laws and regulations and the Articles ofIncorporation of the Company.
2) With regard to the execution of duties by directors, as described in “1. (3) Issues to be addressed” inthe Business Report, inappropriate use of expenses by the Representative Director of the Company(who is scheduled to retire as Representative Director and Director of the Company at the conclusionof the 33rd Ordinary General Meeting of Shareholders to be held on March 27, 2024) was discoveredin the business year under review.
Except for the above, we acknowledge that no misconduct or material fact constituting a violation of
any law or regulation or the Articles of Incorporation of the Company was found with respect to thedirectors’ performance of their duties.
3) We acknowledge that the board of directors’ resolutions with respect to the internal control systems
are appropriate. We did not find any material matter to be mentioned with respect to the content of theBusiness Report or the directors’ performance of their duties concerning the internal control systems,
including the internal control related to the financial report.
As the above-mentioned inappropriate use of expenses by the Company’s Representative Director was
discovered, we acknowledge that there are points in the said internal control systems that need to be
improved in its operation. With regard to this incident, the board of company auditors has confirmedthat the Representative Director of the Company has returned the full amount of the expenses thatwere inappropriately used, and that measures to prevent recurrence have been formulated through astrengthening of the management system, including the internal control systems after taking into
account the analysis of the cause of the inappropriate usage, and that such measures have been
implemented. Going forward, we will continuously monitor the implementation status of thosepreventive measures.
(2) Results of audit of Non-consolidated Financial Statements and their Supplementary Schedules
We acknowledge that the methods and results of audit performed by the financial auditor, KPMG AZSA
LLC, are appropriate.
(3) Results of audit of Consolidated Financial Statements
We acknowledge that the methods and results of audit performed by the financial auditor, KPMG AZSA
LLC, are appropriate.
February 27, 2024
Board of Company Auditors
SEPTENI HOLDINGS CO., LTD.
Full-time Company Auditor Tadahiro Mouri
Company Auditor

Mamoru FurushimaCompany Auditor

Takeshi Okuyama(Note)
Full-time company auditor Tadahiro Mouri, company auditor Mamoru Furushima and company auditor
Takeshi Okuyama are outside company auditors, as set forth in Article 2, item 16, and Article 335,
paragraph (3) of the Companies Act.

- 48 -

(Reference) Sustainability of the Septeni Group
1. Revision of Corporate Philosophy
In October 2022, the SEPTENI Group revised its Group Philosophy in response to significant changes inthe environment surrounding society and business, as well as in the Group’s business structure and scale.
While the mission and creed have been left unchanged as the Group’s significance, mission in society, andspirit that has been passed down since the foundation, we have formulated a new vision to realize our
mission, outlining what we aim to become and the contribution to society that we want to achieve in themedium to long term.
In addition, as we strive to realize our mission and vision, we have defined a new set of values, “Resilient,
Caring, Exciting” that are important to the Group as a whole.

- 49 -

2. Formulation of Sustainability Policy and Materiality Update
Following the revision of the corporate philosophy, we have established the Group’s mission and vision as
our Sustainability Policy.
In addition, we have been regularly inspecting the materiality identified in 2016 and promoting
sustainability activities, and have reviewed the materiality in order to achieve our vision. After gathering
the opinions of the Sustainability Committee, the Group Management Meeting, and the board of directors
multiple times, we identified new materialities upon confirming the appropriateness at the board of
directors. Effective January 2024, the Group has set forth four materialities that have been matched to our
ESG framework, as well as KPI linked to each materiality, and we will continue to promote these activities.
We will continue to actively promote activities to achieve sustainable growth of the Group, increase
corporate value, and realize a sustainable society.

*1 HR strategy designed as a consistent service from recruitment to onboarding to development, based on a talent database accumulated overmore than 20 years.
*2 gen-ten, slogan contests, group sharing meetings, prize essays, Hinerankai Awards, Diversity Month, Diversity Awards, philosophyrelated events, cross-functional committees, etc.
*3 Board of Directors in which the supervising directors utilize their individual expertise to co-create value with the executive side in orderto achieve discontinuous growth.

- 50 -

■Notice regarding the Company’s website
・If revisions to the items subject to measures for electronic provision arise, a notice of the revisions andthe details of the items before and the items after the revisions will be posted on each website that therelevant documents are listed.
・If there are any significant changes to the operation method of this General Meeting of Shareholders,we will provide new instructions on the Company’s website.
・The results of resolutions of this General Meeting of Shareholders will be posted on the Company’s
website.
The Company’s website: https://www.septeni-holdings.co.jp/ir/stock/shareholders/index.html (inJapanese)■Notice regarding electronic provision of informational materials for the general meeting of shareholders
Pursuant to the revision of the Companies Act, a system for the electronic provision of informational
materials for general meetings of shareholders has commenced. Please note that the Company sends
general shareholder meeting materials by mail to only those who had requested to receive paper-based
documents as of December 31, 2023. For those who wish to receive materials for a general meeting ofshareholders by mail for the next or future ordinary general meetings of shareholders, please request thatto the securities company that acts as your broker or Mitsubishi UFJ Trust and Banking Corporation. As it
can take as long as three weeks or longer to fully process such requests, please allow suitable time forprocessing when making such requests.

- 51 -