Platform that Supports
Value Creation Process

Corporate Governance

The Group seeks to enhance corporate governance and internal controls, which are vitalto support sustainable corporate growth. The focus is also on promoting quality control/
production innovations, essential for the business of information systems—a key social
infrastructure—to function and steadily evolve, as well as evolving risk management
processes, including information security and compliance. In addition, TIS strives to build
bonds of trust through active communication with all stakeholders and to promotesustainable corporate value in harmony with the evolving values of society.

■ Communication with Stakeholders
The TIS INTEC Group strives to build bonds of trust through communication with all stakeholders, including clients, employees, shareholders and investors, and business partners, and to boost
corporate value.
● Customer service points of contact(call center, website, main number)● Seminars, fairs and forums for clients● Publication of newslettersand technical brochures● Client satisfaction surveys● Regular meetings
Clients
and others

contribution activities

TIS INTEC Group

opinion exchange groups● Day at the office for children of
employees● President’s Caravan
and others

Shareholders
and Investors

Based on OUR PHILOSOPHY (TIS INTEC Group Philosophy) and Group Vision, we haveformulated basic corporate governance policies aimed at improving the Group’s corporate
value in a sustainable way.
Basic Policy
TIS consistently pursues the best corporate governance practices and constantly works to enhance corporate governance.
Management believes that the key to good corporate governance is to ensure transparency and fairness in decisionmaking processes, make full and effective use of management resources, and raise the integrity of management practices
through swift and accurate assessment of situations, from the viewpoint of promoting sustainable corporate growth andboosting medium- and long-term corporate value. Accordingly, management at the Company is committed to upholding
good corporate governance in line with the following basic principles.

1. To respect the rights of shareholders and to ensure equality in their treatment.
2. To consider the interests of stakeholders, including shareholders, and work with stakeholders in an appropriate manner to achieve stated goals.
3. To disclose corporate information appropriately and ensure transparency.
4. To engage in constructive dialogue with shareholders based on a medium- to long-term investment perspective.

● Charity concerts● Opinion posts from website● Responses to relevant ministries/agencies andindustry associations
and others

Primary methods ofcommunication with stakeholders■ Corporate Governance Structure
Organizational Structure
Chairman of the Board
Number of Directors
Directors’ term of office
Number of Audit & Supervisory Board members
Term of office for Audit & Supervisory Board members
Number of independent directors■ Organizational Chart
General Meeting of Shareholders● Results briefing● Small meetings, domestic and overseas roadshows,participation in conferences● Information disclosure on IR section of corporate websites

Discussion/report
Reports

Audit, reports
Statement of
opinionAppointment, dismissal

Supervision

Audit &
Supervisory Board(Members)

Election, dismissal, supervision

Cooperation

Board of Directors(Directors)

Compensation
Committee
Group Internal
Control Committee● General meeting of shareholders

Appointment, dismissal

Appointment, dismissal

Nomination
Committee

Business
Partners

Company with Audit & Supervisory Board
Chairman and President
Nine, including three external directors
One yearFive, including three external Audit & Supervisory Board members
Four years
Six, including three external directors and three external Audit & Supervisory Board members

Platform that Supports
Value Creation Process● Company news, Group news
● Personnel exchange groups,● Cooperation and support for NGO/NPO social

Community/
Society

Employees● Intranet● Local event participation*Please visit the following page for details of our corporate governance.
http://www.tis.com/ir/policy/governance/

President

Units involved
in internal audits

Reports

Cooperation
Reports

Accounting Auditor

Accounting
audit
Cooperation● Information meetings on policy (guidelines)● Creating opportunities for discussion (project information)● Engineer development and support (educational support, seminars)● New Year celebrations, informal social gatherings

Corporate
Sustainability
Committee● Questionnaires, opportunities for opinion exchange and others● Integrated Report

Reports

Management
Committee
Discussion/report on
significant issuses

Internal audits

Delegation of authority to
execute operations

Executive Officers● Business Report and others
Evaluation

Divisions/Departments

47

Affiliated companies

48

Reason for Selection of Current Corporate Governance Structure
TIS has an Audit & Supervisory Board, a model chosen for its double-check function through which the Board of Directors oversees
the execution of business activities and the Audit & Supervisory Board audits activities to ensure operations are legal and appropriate.
In addition, the Company aims to strengthen the supervisory function of the Board of Directors by appointing outside directors withindustry- and corporate-management-related experience and insight. Drawing on advice and recommendations from an independent
standpoint ensures the validity and appropriateness of decision-making by the Board of Directors.

President and Representative Director, as the chairperson, andgeneral managers, directors in charge, division managers, andthe head of the Corporate Planning Department, as attendees.
If necessary, the chairperson can request the attendance of
Directors and Executive Officers. If deemed necessary forYear ended March 31, 2020

agenda items related to a Group company, the chairperson canrequest the attendance of its president and others to get
explanations, opinions or reporting. Audit & Supervisory Board
members can attend the committee meeting and, if necessary,
express opinions.

Management Committee: 37 meetings held

315 agenda items discussed (179 items resolved and 136 items reported)

Directors and Board of Directors
As stipulated in its Articles of Incorporation, the Company’s
Board of Directors will comprise at least three and no morethan 15 directors, and to strengthen the supervisory functionsof the Board of Directors, a policy has been established thattwo or more of the directors must be independent external
directors. At present, three independent external directors havebeen appointed.
For swift and dynamic decision-making by the Board of
Directors, it convenes in principle once monthly and also meetson an ad hoc basis whenever necessary. TIS holds aninformation meeting once a year to present management
direction as well as meetings ahead of Board of Directors’
meetings—in principle, twice a month—to give external
directors and outside members of the Audit & Supervisory
Board sufficient background information to participate indiscussions. In addition, the Company organizes study sessions
with experts—in-house and external—and arranges visits toYear ended March 31, 2020

Board of Directors: 19 meetings held (including one by written communication);

136 agenda items discussed (70 items resolved and 66 items reported)

Average Time for Deliberations per Meeting(excluding meeting by written communication)

Number of Agenda Items

59

128
66

136

2.09 hours

2.15 hours
1.54 hours

66

60

62

70

Fiscal 2018

Fiscal 2019

Fiscal 2020

Fiscal 2018

Fiscal 2019

Fiscal 2020

Fiscal 2019

Fiscal 2020

Number of Meetings Held
Fiscal 2018
16

19

19

(including one by written
communication)(including one by written
communication)

Management Committee
The Management Committee convenes twice a month inprinciple, where members deliberate and report important

49(Reference) Our Efforts on Group Management
To improve corporate value through unified groupmanagement, the Group focuses on improving performance bycompleting a PDCA (plan-do-check-act) cycle with reference tocurrent key performance indicators (KPIs). TIS and Group
companies evaluate their performance based on financial
indicators, including shared Group KPIs and process indicators
related to customers, internal processes, and learn and growth

initiatives. In addition, to ensure completion of the PDCA cycle,a Group Business Meeting is held on a quarterly basis to reporton budgets and the progress of major activities at Group
companies, and to discuss measures taken to address important
issues. A Group President Meeting is also held on a monthly
basis to share information on Groupwide issues andperformance.

Summary of Results of Analysis and Evaluation of Effectiveness of Entire Board of Directors
Since fiscal 2016, ended March 31, 2016, the Company has
evaluated the effectiveness of the Board of Directors each fiscal
year. This process reveals issues and points for improvement
and leads to initiatives that will raise the effectiveness of theBoard of Directors to a higher level. For the fiscal 2020
evaluation, all directors and members of the Audit &Supervisory Board were given a questionnaire to be submitted
anonymously. The questionnaire asked them to conduct acomprehensive self-evaluation and self-analysis of thecomposition and operation of the Board of Directors, and thenthe Board of Directors held discussions based on the results.
The method and results of the evaluation, as well as futureissues brought to light through this process and measures toaddress such issues are described below.
1. Method of evaluation
TIS distributed a questionnaire regarding the effectiveness of
the Board of Directors to all directors and members of the Audit& Supervisory Board. The Company’s Board of Directors used
the responses to analyze and evaluate the effectiveness of theBoard of Directors. Note that TIS conducted this evaluation
based on advice and verification by an external attorney.
2.	Results of analysis and evaluation of effectiveness of
the Board of Directors
The Company’s Board of Directors concluded, based on
Company regulations, that sufficient effectiveness had beenachieved to appropriately supervise the approval of importantmanagement matters and business execution, such as thestatus of business activities and investments at the Company
and Group companies. In addition, the Board of Directors
concluded that the level of effectiveness continues to trend
upward, reflecting improvement measures based on the resultsof effectiveness evaluations conducted in previous years.
However, the Company’s Board of Directors acknowledged
the importance of strengthening governance at each Group
company through their respective boards of directors andimproving the appropriateness of explanations for issues
discussed at board meetings.
3.	Future issues and associated responses, based on
analysis and evaluation
In light of the analysis and evaluation previously mentioned, TIS
will focus particular efforts on the following issues.
(1) Strengthening governance of the Group
The Board of Directors will hold a meeting to exchange
opinions on governance of the Group to clarify issues to be
improved and respond to them.
(2)	Improving the appropriateness of explanations foreach agenda item at the meeting
The Board of Directors will improve the appropriateness of
explanations for agenda items at the meeting and focus on theissues to be discussed, so that the Board can contribute to
management promptly.

matters related to the execution of business activities
throughout TIS and the Group. The committee consists of the50

Platform that Supports
Value Creation Process■ ■ Items Resolved ■ ■ Items Reported

119

local Group facilities and offices. TIS also creates opportunities
for external directors to exchange opinions with the President
and convenes meetings that involve only external directors andexternal members of the Audit & Supervisory Board. Thisfacilitates smooth but vigorous discussion by the Board of
Directors.
The Group seeks to enhance corporate governance andinternal controls, which are vital to support sustainablecorporate growth. The focus is also on promoting quality
control/production innovations, essential for the business of
information systems—a key social infrastructure—to function
and steadily evolve, as well as evolving risk management
processes, including information security and compliance. In
addition, TIS strives to build bonds of trust through active
communication with all stakeholders and to promotesustainable corporate value in harmony with the evolving valuesof society.

*Please visit the following page for profile of Directors and Audit & Supervisory Board Members
http://www.tis.com/company/officer/

Policy and Procedures for Election, Dismissal, and Nomination of Directors, etc.
In nominating candidates for directors, Audit & Supervisory
Board members and executive officers, the Board of Directors
will nominate persons with abundant experience, a high level of
insight and advanced specialization based on the Company’s
election criteria that make them suitable as directors or Audit &Supervisory Board members in order to realize effective
corporate governance and contribute to the sustainable growthof the Company as well as the enhancement of its medium- tolong-term corporate value while also considering aspects ofReason for Election of Directors and Audit & Supervisory Board Members

diversity such as gender and internationality. For directors, theBoard of Directors considers nominations based on the adviceof the Nomination Committee, the majority of members ofwhich are independent external directors.
If a situation arises where a management executive should
be dismissed, the Board of Directors shall determine a dismissal
proposal. However, the dismissal of a director shall be
conducted in accordance with the Companies Act and otherrelevant provisions.

Fields of Members’ Specialization
Title

Directors

Corporate
Industry
Management Knowledge

International
Experience

Finance &Accounting

Representative Director,
Chairman and President

Toru Kuwano●●

Representative Director,
Executive Vice President

Masahiko Adachi●●

Director, Executive
Vice President

Yasushi Okamoto

●

●

●

Director, Executive
Vice President

Josaku Yanai

●

●

●

Director

Takayuki Kitaoka●●

Director

Akira Shinkai●●

Director (External)

Koichi Sano●

Director (External)

Fumio Tsuchiya●

Director (External)

Naoko Mizukoshi

Standing Audit &Supervisory Board Member

Tetsuya Asano●●

Standing Audit &Supervisory Board Member

Tatsufumi Matsuoka●●

Audit & Supervisory
Board Member (External)

Sadahei Funakoshi

Audit & Supervisory
Board Member (External)

Yukio Ono●

Audit & Supervisory
Board Member (External)

Akiko Yamakawa

●

Legal

Toru Kuwano, Chairman and President
Date of Birth: May 3, 1952

Number of shares owned: 53,000 shares

Term of office: seven years

Reason for Election
After assuming the office of President and Representative Director of the Group company,
Mr. Kuwano was appointed as a Director of the Company in June 2013. Since June 2016,he has assumed the office of President and Representative Director of the Company. He hasa wealth of experience and knowledge about the Company’s and its Group’s business, aswell as in business administration.
He was appointed as a Director since he is expected to continue to promote theMedium-Term Management Plan (2018–2020) and fulfill the duties of significant decisionmaking for the Group as well as the administration and oversight of business management.

●

Masahiko Adachi, Representative Director, Executive Vice President●

Date of Birth: May 9, 1956

Number of shares owned: 13,400 shares

Term of office: two years

Reason for Election
Mr. Adachi has been in the office of Representative Director since June 2018 following his
holding the office of Division Manager of the corporate department and the financial system
department of a financial institution and the Company’s Group company.
Based on these experiences, he was appointed as a Director since he is expected tocontinue to promote group governance as set out in the Medium-Term Management Plan
(2018–2020), centered on the corporate function, and fulfill the duties of significant
decision-making for the Group and oversight of business management.
●

●

●

●

●

●

●

Yasushi Okamoto, Director, Executive Vice President
Date of Birth: March 3, 1962

Number of shares owned: 16,152 shares

Term of office: two years

Reason for Election
Mr. Okamoto has been serving as Senior Managing Executive Officer and Division Managerof the planning and development department of industrial systems since July 2016, and has
been in the office of Director since June 2018, after having been engaged in corporate
business in the corporate planning department of the Company for many years.
Based on these experiences, he was appointed as a Director since he is expected tocontinue to promote the Medium-Term Management Plan (2018–2020), and fulfill theduties of significant decision-making for the Group and oversight of business management.

●●●

Josaku Yanai, Director, Executive Vice President
Date of Birth: November 14, 1963

Number of shares owned: 16,900 shares

Term of office: four years

Reason for Election
Mr. Yanai was mainly engaged in the corporate planning department of the Company andits group company for many years. He assumed the office of Executive Officer and Division
Manager of the corporate planning division of the Company in April 2011. Since June 2016,he has been serving as a Director of the Company.
He has a wealth of experience and knowledge about the business of the Company and
the Group, as well as in business administration. Based on these experiences, he wasappointed as a Director since he is expected to continue to promote the Medium-Term
Management Plan (2018–2020), and fulfill the duties of significant decision-making for theGroup and the administration and oversight of business management as a Director.
51

52

Platform that Supports
Value Creation Process

Audit &
Supervisory
Board
members

Name

Directors

Takayuki Kitaoka, Director
Date of Birth: December 14, 1960

Number of shares owned: 3,554 shares

Term of office: two years

Reason for Election
Mr. Kitaoka was engaged in business related to IT infrastructure of INTEC Inc., theCompany’s major subsidiary, and served in management administration of the Group­companies at the Company for three years since April 2012.
Furthermore, he assumed the office of President and Representative Director of INTEC
Inc. in April 2018 and the office of Director of the Company in June 2018. He was appointed
as a Director since he is expected to continue to promote the duties of INTEC Inc. assignedby the Medium-Term Management Plan (2018–2020) and to fulfill the duties of significant
decision-making for the Group and the administration and oversight of business management, based on the above experiences and from the viewpoint of Group management.

Reason for Election
Ms. Mizukoshi is a qualified lawyer and has a wealth of professional knowledge of, andexperiences in, intellectual property, ICT and international transactions.
Her advice and suggestions from an independent perspective will ensure that the decisions
made by the Company’s Board of Directors will be reasonable and appropriate by ­utilizingthese experiences and expertise in the Company’s business, and she is expected to be a person
who will contribute to the enforcement of the corporate governance of the Company.
She has not participated in corporate management but has expertise in corporate legal
work. Therefore, she was appointed as an External Director since she could discharge duly
the duties of External Director.
Audit & Supervisory Board Members

Akira Shinkai, Director
Date of Birth: March 24, 1959

Naoko Mizukoshi* (Partner of Leftright Law & IP), External Director
Date of Birth: September 23, 1967 Number of shares owned: 200 shares Term of office: two years

Number of shares owned: 5,100 shares

Term of office: two years

Reason for Election
Mr. Shinkai was engaged in the business of new service planning and marketing andassumed the office of Director and Executive Vice President of INTEC Inc., the Company’s major
subsidiary, in April 2018, and the office of Director of the Company in June 2018.
Based on these experiences, he was appointed as a Director since he is expected to­continue to promote the Medium-Term Management Plan (2018–2020), and fulfill the duties
of significant decision-making for the Group and the administration and oversight of business
management.

Tetsuya Asano, Standing Audit & Supervisory Board Member
Date of Birth: October 22, 1960 Number of shares owned: 1,300 shares
Term of office: — (assumed office in June 2020)

Reason for Election
Mr. Asano has a wealth of expertise in finance and accounting as well as in corporate management, accumulated through many years of experience of working at financial institutions
and managing companies. He was appointed as an Audit & Supervisory Board Member, as
he is expected to discharge audit and supervisory duties regarding the execution of duties of
the Company's directors in a fair and appropriate manner.

External Directors

Tatsufumi Matsuoka, Standing Audit & Supervisory Board Member

Koichi Sano*, External Director
Date of Birth: August 30, 1948

Number of shares owned: 700 shares

Term of office: four years

Number of shares owned: 3,200 shares

Term of office: one year

Reason for Election
Mr. Matsuoka has a wealth of expertise in finance and accounting as well as corporate­management based on experience accumulated through his service at financial institutions
and management of companies over many years.
He was appointed as an Audit & Supervisory Board Member as he is expected to­discharge audit and supervisory duties regarding the execution of duties of the Company’s
directors in a fair and appropriate manner.

Platform that Supports
Value Creation Process(Other Important Concurrent Positions)
External Director of Nippon Yakin Kogyo Co., Ltd.
Reason for Election
Mr. Sano worked mainly in the finance and accounting departments, and served as Executive
Vice-President and Representative Director of Mitsui Chemicals, Inc., and has a wide range ofexperience and a wealth of expertise in corporate management. He was appointed as an External
Director since his advice and suggestions from an independent perspective by utilizing theseexperiences and expertise in the Company’s business will ensure that the decisions made by theCompany’s Board of Directors will be reasonable and appropriate, and he is expected to be a­person who will contribute to the enforcement of the corporate governance of the Company.

Date of Birth: December 2, 1957

External Audit & Supervisory Board Members

Fumio Tsuchiya*, External Director
Date of Birth: May 10, 1948

Number of shares owned: —Term of office: three years

Reason for Election
Mr. Tsuchiya previously worked in an important position in overseas offices and the Corporate
Planning Department of Japan Airlines Co., Ltd. After having assumed the office of Director ofJapan Airlines in June 2004, he served as Managing Director and was thereafter appointed as
President & CEO of JALCard, Inc., in June 2007, which is a group company of Japan Airlines.
He has a wide range of experience and a wealth of expertise in corporate management.
He was appointed as an External Director since his advice and suggestions from an­independent perspective by utilizing these experiences and expertise in the Company’s­business will ensure that the decisions made by the Company’s Board of Directors will be­reasonable and appropriate, and he is expected to be a person who will contribute to theenforcement of the corporate governance of the Company.

53

Sadahei Funakoshi*, External Audit & Supervisory Board Member
Date of Birth: August 15, 1954

Number of shares owned: 200 shares

Term of office: four years

Reason for Election
Mr. Funakoshi has a wealth of experience and knowledge in corporate management, withhis experience in the management of investment and loan, credit and administrative departments of Mitsubishi Corporation, as well as his service as an auditor at IT companies. He wasappointed as an External Audit & Supervisory Board Member in expectation of obtaining his
overall management advisory and management oversight on execution of duties from anexternal perspective.

54

Yukio Ono* (President of Accounting Offices of Yukio Ono),
External Audit & Supervisory Board Member
Date of Birth: January 1, 1950 Number of shares owned: —Term of office: — (assumed office in June 2020)

Reason for Election
Mr. Ono is a certified public accountant and is qualified to help strengthen the Group’s
auditing system by virtue of his expertise in finance, accounting, and other fields, as well as
his long experience in corporate auditing.
Although he has not participated in corporate management, he was appointed as anExternal Audit & Supervisory Board Member based on the judgment that he would be able
to perform his duties appropriately for the abovementioned reasons.
I will use my experience as a certified public accountant to contribute to theenhancement of our Group‘s corporate value.
Due to the rapid development of digital technology, society and the economy have undergone
great changes, and the Fourth Industrial Revolution—at the core of which AI and IoT areembedded—is currently underway. All industrial revolutions have included groundbreaking
inventions and innovations. In this context, our Group’s business of utilizing digital technology
is the driving force that will usher in a new era. In addition, as with infections in the past, the
COVID-19 pandemic is transforming society.
At the same time, modern companies contribute to society and grow through organic
relationships with stakeholders such as customers, shareholders and investors, and employees
as well as local communities and society at large. Our Group can ensure sustainable growth byprocuring capital, investing, and achieving results while maintaining these organic
relationships.
Under these circumstances, our Group’s business of utilizing digital technology is thedriving force that will usher in a new era. To assist the Group in contributing to society as adigital technology mover under OUR PHILOSOPHY, I would like to use my experience inaccounting and auditing to contribute to the sustainable improvement of corporate value
through the further strengthening of governance in our Group.

Training Policy for Directors and Audit & Supervisory Board Members
For directors and auditors, including external directors andexternal auditors, the Company will arrange and support thecost of training opportunities that are appropriate. The
objective of such training is to provide an opportunity toacquire necessary knowledge regarding the Group’s businesses,

financial affairs and organization and to understand the duties
and responsibilities required of directors and Audit &Supervisory Board members when assuming office, as well as tocontinuously develop these attributes during the term of office.

Primary Activities of External Directors and External Auditors (Year Ended March 31, 2020)
Attendance at Board of Directors meetings
Name

External
Directors

External Audit& Supervisory
Board members

Attendance rate

Primary activities

Koichi Sano100%

Attended all 17 meetings of the Board of Directors held in fiscal 2020

Fumio Tsuchiya

100%

Attended all 17 meetings of the Board of Directors held in fiscal 2020

Naoko Mizukoshi

100%

Attended all 17 meetings of the Board of Directors held in fiscal 2020

Taigi Ito*

94.1%

Attended 16 of 17 meetings of the Board of Directors held in fiscal 2020

Muneaki Ueda*

88.2%

Attended 15 of 17 meetings of the Board of Directors held in fiscal 2020

Sadahei Funakoshi

100%

Attended all 17 meetings of the Board of Directors held in fiscal 2020

Attendance at Audit & Supervisory Board meetings
Name

Akiko Yamakawa* (Partner of Vanguard Lawyers Tokyo),
External Audit & Supervisory Board Member
Date of Birth: April 5, 1973 Number of shares owned: —Term of office: — (assumed office in June 2020)

I will utilize my experience as a lawyer to contribute to business growth throughappropriate risk management.
In its medium-term management plan, the Company identifies its corporate targets as
becoming a “Company where diverse employees who are reliable, proud, and adopt a unified
approach work enthusiastically” and becoming “a top-class IT group in the ASEAN region” inaddition to the attainment of management goals and the pursuit of structural transformation.
Because the greatest asset of a company is its people, it cannot grow without an appropriate
and advanced human resource system. At the same time, overseas expansion is essential tosurvive in a globalized world. However, risks are inherent in both human resources andoverseas expansion, and appropriate risk management—that is, “avoid risks that should be
avoided and take risks that should be taken”—is extremely important for dynamic andproactive business development. As an attorney, I have provided advice mainly on labor
relations, dispute resolution, and crisis management to a variety of companies with global
operations. Drawing on this experience, I intend to use my role as an external auditor to help
the Company achieve business development while complying with the laws and regulations ofeach country in which it operates and appropriately managing risks.

Primary activities

Taigi Ito*

92.3%

Attended 12 of 13 meetings of the Audit & Supervisory Board held in fiscal 2020

Muneaki Ueda*

100%

Attended all 13 meetings of the Audit & Supervisory Board held in fiscal 2020

Sadahei Funakoshi

100%

Attended all 13 meetings of the Audit & Supervisory Board held in fiscal 2020

Platform that Supports
Value Creation Process

Reason for Election
After registering as an attorney, Ms. Yamakawa joined a foreign law firm and was
responsible for legal affairs at global companies. She is expected to be someone who canappropriately supervise and monitor the lawful execution of the Company‘s global business.
Although she has not participated in corporate management, she was appointed as anExternal Audit & Supervisory Board Member based on the judgment that she would be able
to perform her duties appropriately for the abovementioned reasons.

External Audit& Supervisory
Board members

Attendance rate

* Taigi Ito and Muneaki Ueda retired due to expiration of term at the conclusion of the 12th Annual General Meeting of Shareholders on June 24, 2020.

Summary of Content of Liability Agreements
In accordance with Article 427, Paragraph 1, of theCompanies Act, each of the external directors and theexternal Audit & Supervisory Board members enters into anagreement with the Company that limits legal responsibility
for liability compensation as set forth under Article 423,

Paragraph 1, of the same law.
The limit of liability compensation, based on these
agreements, is an amount provided as Minimum Liability
Amount in Article 425, Paragraph 1, of the same law.

* Designated as an Independent Director/Auditor as specified by the Tokyo Stock Exchange in Japan.
Notes: 1. As of July 1, 2020.
2.	As of July 1, 2016, the Company (previous name, IT Holdings Corporation) changed its name to TIS Inc. due to the absorption-type merger with the previous TIS
Inc. (an absorbed company), wholly-owned subsidiary of the IT Holdings Corporation (a surviving company).

55

56

Outline of Policy on Officers’ Remuneration(2) Structure of officers’ compensation
As shown below, compensation to Company directors consists of a basic component, a performance-linked component andperformance-linked stock incentive. When measures of Company performance are achieved to the maximum degree, compensation
will comprise the basic component, the performance-linked component and the performance-linked stock incentive in a ratio of 7:2:1.
Base component
68%

Performance-linked
component
21%

Performancelinked stockincentive
11%*TIS introduced this performance-linked stock compensation system in fiscal 2019 for directors, executive officers and executive fellows (excluding external directors,
nonexecutive directors and residents outside Japan) with the objective of making eligible directors more aware of their contribution to enhanced business performanceand improved corporate value over the medium to long term and to align their interests with those of shareholders.

(3) Structure of compensation for External Directors and Audit & Supervisory Board members
Compensation paid to external directors is limited to basic compensation only, with no performance-linked component.
Compensation for Audit & Supervisory Board members is decided through discussion by corporate auditors. From the perspective of
maintaining a high degree of independence, compensation is not linked to business performance and consists solely of basic
compensation.
(4) Other
To boost medium- to long-term business performance, directors (excluding outside directors) are asked to contribute a certain
portion of their basic compensation toward the purchase of treasury stock through the Company’s share ownership plan for directors
and officers, and they are expected to retain such stock in full for the duration of their time in office so that the acquired stock
shares value with all shareholders.

a.	Attainment of business plans formulated at the beginning of the fiscal year in accordance with the mid-term management plan is
confirmed by the Performance Evaluation Committee.
b.	The President and Representative Director evaluates the directors and Audit & Supervisory Board members at the meeting of the
Performance Evaluation Committee referred to in a. above.
c.	The Compensation Committee meets to consult on the results of the evaluation in b. above and amounts of compensation basedon the results of evaluation.
d.	The Board of Directors votes on whether to approve the amounts of executive compensation considered by the Compensation
Committee in c. above.
Performance-linked stock compensation is calculated in accordance with the Stock Issuance Regulations. The Board of Directors
and the Compensation Committee have no room for discretion.

57

Individual Performance
Evaluation
A
B
C D
E
A
B
C
D
E

Distribution composition (image)In fiscal 2020, performance-linked compensation was determined by applying a 30% performance evaluation coefficient based on
the level of attainment of targets in the previous fiscal year including Consolidated Sales, Consolidated Operating Income, andConsolidated ROE.
Performance indicators

Fiscal 2020, ended March 2020

Fiscal 2019, ended March 2019

Estimates

ActualActualConsolidated Sales¥436,000 million¥443,717 million¥420,769 million

Consolidated Operating Income¥42,000 million¥44,839 million¥38,043 million

12.1%

12.5%

11.5%

Consolidated ROE● Performance-linked stock incentive

For the performance-linked stock incentive, the Board of Directors established the Stock Delivery Regulations when the performancelinked stock incentive plan was introduced. Points are granted to directors on a scale between 0% and 15% of basic compensation
set for each position according to the level of achievement made toward reaching performance targets stated in the management
plan and as provided for in the Regulations. The number of shares delivered will correspond to the number of points accumulated.
For corporate performance indicators, Consolidated Operating Income, Consolidated ROE, and Service Business Sales wereadopted as financial indicators to encourage pursuit of business growth, and employee satisfaction was adopted as a nonfinancial
indicator to encourage pursuit of higher job satisfaction among employees, and to ensure attainment of enhanced corporate value
as expected by the shareholders.
In fiscal 2020, the amount of performance-linked stock compensation was determined by applying a performance-linked
coefficient of 150% because actual results exceeded estimates (100% performance-linked coefficient when attained) by a wide
margin.
Performance indicators

Consolidated Operating Income

Fiscal 2020, ended March 2020
Estimates

Actual¥42,000 million¥44,839 million

12.1%

12.5%

Service Business Sales¥40,941 million¥42,091 million1

Employee Satisfaction

45.0%

46.0%2

Consolidated ROE

Notes: 1.	Predefined as a target in the Stock Issuance Regulations based on operations selected for their contribution to the structural transformation of the Company on a
non-consolidated basis. They do not represent service business sales on a consolidated basis.
2.	Determined by a questionnaire survey conducted by an outside organization. Satisfaction is scored based on the proportions of employees who answered “often
applies (4)” or higher regarding “trust.”

58

Platform that Supports
Value Creation Process● Process for determining executive compensation

Organizational
Performance
Evaluation(1) Determination of compensation
The Company has established the Compensation Committee, comprising mainly independent external directors, as an advisory bodyto the Board of Directors to ensure objectivity and transparency in the process for determining compensation and to strengthen thecorporate governance structure.
The basic policy on officers’ compensation is to provide greater incentive to improve business results through a system ofcompensation linked to measures of Company performance, and such amounts are determined through a decision by the Board of
Directors, based on discussion with and suggestions by the Compensation Committee.

● Basic compensation
Basic compensation is paid according to the size of the role and scope of responsibilities of each position.
● Performance-linked compensation
Performance-linked compensation is determined by the degree to which measures of corporate
performance have been achieved, on the basis of the management plan for each fiscal year, andshall fall within a performance evaluation coefficient of between 0% and 30% of basic
compensation for each position.
The performance evaluation coefficient consists of organizational performance component
and individual performance component in a ratio of 3:7. Organizational performance andindividual performance are each evaluated on a five-point scale to determine the amount of
performance-linked compensation.

● Outline of performance-linked stock compensation system

An Executive Compensation BIP Trust (hereafter, “BIP Trust scheme”) was introduced as a performance-linked stock compensation
system by resolution of the 10th General Meeting of Shareholders held on June 26, 2018. Those eligible for benefits are directors(excluding external directors and non-executive directors), executive officers with portfolios, executive officers, and executive fellows(hereafter, “Directors, etc.”).
a. Organization of the BIP Trust scheme
On introducing the BIP Trust scheme, the Company established the Stock Delivery Regulations for Executive Compensation BIP Trust(Stock Delivery Regulations), under which TIS entrusts a nominated trust bank with money (not exceeding ¥500 million), and thetrust bank acquires TIS shares with the entrusted money.
The scheme grants points to Directors, etc., in accordance with the Stock Issuance Regulations. The number of shares to bedelivered will correspond to the number of points accumulated, which is calculated by the formula below.
Calculation Formula
The number of TIS shares to be delivered (points*) = Base amount × Performance fluctuation coefficient ÷ Acquisition cost per unit

Total remuneration amounts and other information about officers who received remuneration in an amount of ¥100 million or more
on a consolidated basis is as follows.
Remuneration by type (Millions of yen)
Name

Toru Kuwano

Director

Basic
remuneration

Performancelinked
remuneration

Performancelinked stockcompensation

73

15

11

Submitting
company

The Nomination Committee and the Compensation Committee were established as advisory bodies to the Board of Directors toensure objectivity and transparency in decision-making processes pursuant to appointment of directors and associated compensationand to strengthen the corporate governance structure.
Nomination Committee

Composition of members

b. Total number of shares to be granted to Directors, etc.: 183,900 shares in one financial year (upper limit)
Note:	The Company executed a stock split, with each share of common stock split into three shares, effective April 1, 2020. Accordingly, the upper limit on the numberof shares delivered through the trust represents the post-stock-split number of shares.

c. Scope of individuals able to receive beneficiary rights and other rights under the BIP Trust scheme:
Individuals who have retired from being a Director, etc., and meet the beneficiary conditions specified in the Stock Issuance
Regulations.

Remuneration for Directors and Audit & Supervisory Board Members (Year Ended March 31, 2020)

Performancelinked
remuneration

Performancelinked stockcompensation

287
(31)

214
(31)

47
(—)

25
(—)

6
(3)

67
(25)

67
(25)

—

—

(—)

(—)

15
(6)

354
(57)

281
(56)

47
(—)

25
(—)

Remuneration

Directors(External Directors)

9(3)

Audit & Supervisory Board members(External Auditors)
Total(External Directors and External Auditors)

Notes: 1.	For the fiscal year ended March 31, 2020, compensation for directors does not include the employee portion for directors who serve concurrently as employees.
The Company has not introduced a retirement benefit system for directors, and does not pay any directors’ bonuses.
2.	As of March 31, 2020, the Company has nine directors, including three external directors, and five Audit & Supervisory Board members, including three external
auditors. The discrepancy in Audit & Supervisory Board members between this number and the number of recipients above is attributable to the inclusion of one
member who retired at the conclusion of the 11th Annual General Meeting of Shareholders on June 25, 2019.
3.	Limits on compensation (basic compensation and performance-linked compensation) for directors and members of the Audit & Supervisory Board were approvedat the First Annual General Meeting of Shareholders on June 25, 2009, with the limit on compensation for directors set at ¥400 million per year (of which,external directors receive no more than ¥50 million) and that for members of the Audit & Supervisory Board set at ¥85 million.
4.	The performance-linked stock incentive is booked as an expense for four directors (excluding external directors and non-full-time directors) in the current businessyear.
		Note that this performance-linked stock incentive was approved by shareholders at the 10th Annual General Meeting of Shareholders on June 26, 2018, wherein
the upper limit on the number of shares is 183,900* per fiscal year, to be delivered through a trust into which the Company contributes up to ¥500 million ineach specified period (three fiscal years) for eligible directors (excluding external directors, non-full-time directors), executive officers and executive fellows.
		* The Company executed a stock split, with each share of common stock split into three shares, effective April 1, 2020. Accordingly, the upper limit on thenumber of shares represents the post-stock split number of shares.

All committee members: 4 (internal Directors: 1, external Directors: 3)
Chairman: President and Representative Director of TIS
Provide advice on matters related to decisions oncompensation for directors

Status of activities bycommittees(Fiscal 2020)• Held twice in fiscal 2020 with 100% attendance• Held six times in fiscal 2020 with 100%of all the members
attendance of all the members• Discussed the appropriateness of the Company’s• Provided advice on the appointment andcompensation package through a comparative
retirement of key individuals, including
analysis of director compensation amounts at
directors, and presented proposals on changes
to director composition, based on discussions by other companies and at TIS, based on thefindings of a research company, as well as theCommittee members
appropriateness of the calculation method used
• Gave advice on future approaches for a
to determine performance-linked compensation
succession plan based on the current status• Made proposals to the Board of Directors on
shared by the members
director compensation, based on the results ofdiscussion by the Committee

Remarks

To provide sufficient information for members to facilitate smooth proceedings, the committees arechaired by Chairman and President, an internal director. To promote higher effectiveness of theCommittee, the Company encourages forthright discussions among the members.

Constructive Dialogue with Shareholders
TIS will engage in constructive dialogue with shareholders
based on the IR Policy in order to contribute to the Company’ssustainable growth and the enhancement of its medium- tolong-term corporate value. In addition, the Company will strive
to develop a system to promote constructive dialogue withshareholders. The director of the IR Department will supervise
the dialogue with shareholders, consider response methods
with the President and Representative Director, executive
officers in charge, and the IR Department, and will respond
appropriately. The IR Department will share information andexchange opinions in a timely manner based on the respective
specialist standpoints of relevant departments and will support
dialogue with shareholders through organic collaboration.
In relation to shareholders, TIS will strive to broaden themeans of dialogue such as through individual face-to-faceinterviews as well as telephone interviews, and holding businessresults briefings and small meetings. Furthermore, in addition toactive information disclosure, which will be the premise for
dialogue, the Company will strive to expand the contents of theIntegrated Report, which will be positioned as an effective toolfor dialogue.
TIS will share opinions put forward in constructive dialogue
with capital market participants such as shareholders, investors
and securities analysts within the Company through reports andbriefings to the Board of Directors, and use them in reviewing
the Company’s management strategy, and for other purposes.
In the case of dialogue with shareholders, TIS will pay
attention to the fairness of information disclosure and manageinternal information appropriately in accordance with the Rules
for Prevention of Insider Trading.
60

Platform that Supports
Value Creation Process

Basic remuneration

Recipients (Persons)Compensation Committee

Provide advice for selecting candidates to theRole of committee members position of director and matters related to theappointment of such individuals

Remuneration by type

59

100

Type ofcompany

Nomination Committee and Compensation Committee* Decimals rounded down

(Millions of yen)

Remuneration(Millions of yen) Type of officer

Messages from Our External Directors

We will utilize the experience and knowledge of external directors to enhance the corporate
value of the TIS INTEC Group.

Strategically Held Shares
1.	Policy and viewpoint regarding reduction of strategicallyheld shares
TIS and other companies under the Group umbrella hold sharesin other companies only when management believes this isnecessary for such purposes as establishing long-term, stable
relationships with customers and promoting business that willcontribute to the sustainable growth and higher medium- tolong term corporate value of the Company and the Group.
Each year, the Board of Directors reviews the relevance ofcross-shareholdings. It is corporate policy for any crossshareholding that the Board of Directors deems to be ofdiminished significance for the cross-shareholding to be sold at
the earliest possible opportunity.
To determine relevance, TIS uses business-related revenue if
the issuing company is a customer of a Group company orannual transaction amount if the issuing company is a strategic
partner to calculate a percentage on a balance sheet basis, andmanagement will consider selling any issue with a ratio that falls
below a benchmark set by the Company.

For cross-shareholdings with diminished significance, as
identified through the aforementioned method, TIS moves toreduce cross-shareholdings in accordance with this basic policy.

We received the following messages from our external directors regarding future themes, expectations,and issues of the Group as it undergoes structural transformation.

Strengthening sustainability through ESG management
2.	Policy on exercising voting rights relating to strategicallyheld shares
TIS appropriately exercises voting rights for the listed shares in its
possession after comprehensively determining whether suchaction will contribute to the sustainable corporate growth andhigher medium- to long-term corporate value of the TIS INTECGroup and investee company, taking into consideration policy
advice from proxy advisory firms.
Koichi Sano, External Director

3. Relationships with strategic shareholders
If strategic shareholders of TIS indicate an intention regarding
the sale of TIS shares, we will respond appropriately without
preventing such a sale. Moreover, we will not conducttransactions that lack economic rationality with strategic
shareholders.

Numbers of stocks held by the Company for purposes other than portfolio investment and total amounts recorded in the balance
sheet are as follows.
Fiscal 2019, ended March 2019 Fiscal 2020, ended March 2020

Number of stocks
Total amount on balance sheet

87 stocks

96 stocks¥44,423 million¥53,632 million“Open and flexible thinking” and “healthy skepticism” will lead to theachievement of structural transformation

Fumio Tsuchiya, External Director

Amount on Balance Sheet■ ■ Listed Stock ■ ■ Unlisted Stock

98

45

87

–8
–4
–4

■ ■ Listed Stock ■ ■ Unlisted Stock

+17

96

+17

56,7004,838
44,423
5,734

65

52

+19,194–7,764–7+19,187(Millions of yen)

–2,221–1,024–1,19753,632
23,889–7,756+7

51,862
38,68943

Fiscal 201861

Fiscal 201929,742

31

35

Sold

AcquiredFiscal 2020

Fiscal 2018 Fiscal 2019

Sold

Acquired

One of the main pillars of the Company‘s medium-term management plan is “structural transformation”. In addition
to the build-to-order business—in which IT systems are built in response to customer requests—the Company isfocusing on expanding into the proposal-driven business, which anticipates customer requests. The Company is also
actively expanding its business in overseas markets, primarily through capital tie-ups with leading IT companies in the
ASEAN region, and the results of these initiatives have been steadily reflected in its performance in recent years. To
promote such structural transformation, I believe it is essential to move beyond conventional methods and encourage“open and flexible thinking” to tackle challenges aggressively.
On the other hand, in new business domains such as overseas operations operating under different laws andbusiness practices, it is important to recognize and address the inherent risks. In the process of expanding our business, various risks are sometimes encountered for which there is little accumulated experience. When this occurs, I
believe that it is necessary to have a “healthy skepticism” backed by calm judgment in order to conduct appropriate
risk assessment. I also feel it is important to strike a balance between vigorously promoting business and taking a
step back to judge the situation calmly. Using this as the basis of decisions by external directors, I intend to do what I
can to contribute to promoting structural transformation.

Change in Fiscal 2020
Fair Value,etc.

Enhancing corporate governance to support steady transformation andsustainable growth
The Board of Directors is charged with focusing on important issues that are essential for disciplined and sustainablegrowth. Deliberations are not limited directly to the matter at hand, but include discussions on the purpose, background, impact, and root cause of issues under consideration. The agenda items for discussion increasingly include
such topics as investments to capture innovation, stock acquisitions to expand the business base in ASEAN, and strategic alliances. Human resource development, organizational diversity, and the prevention of impropriety and adverse
events continue to be important, and we prepare for substantive deliberations at the Board of Directors after holding
prior briefings.
As an external director, I participate in discussions to assess the social significance, competitive advantage, efficiency, and feasibility of proposals from the perspective of stakeholders, including shareholders. In particular, in our
Naoko Mizukoshi, External Director overseas business, while systems and practises differ from country to country, I believe that we need to further
enhance our corporate governance in order to deepen relationships of trust with our business partners in ASEAN and(Partner of Leftright Law & IP)grow together with the aim of providing high-quality services and resolving social issues. In addition, now that we arecoping with the impact of COVID-19, I believe it is necessary to ensure the health of our workforce, while making
dynamic decisions in the execution of business and considering the environment. I will strive to contribute to theGroup’s growth and fulfill my responsibilities while responding to changes in the operating environment.
62

Platform that Supports
Value Creation Process

According to the policy on strategically held shares, TIS sold entire holdings of eight stocks and partial holdings of one stock for theyear ended March 31, 2020, steadily reducing the amount of previously held cross-shareholdings. On the other hand, as part of its
growth strategy, TIS actively makes investments in startups with the objective of developing strategic partnerships to facilitate open
innovation, and forms capital and business alliances with leading foreign companies. In fiscal 2020, 17 unlisted stocks were newly
acquired, including an issue of Grab Holdings Inc. (approximately ¥16.5 billion).

Number of Stocks

In the fiscal year ended March 2020, the Board of Directors passed a total of 17 resolutions (excluding statutory matters, etc.) and these covered almost all major areas evenly, such as investment and financing for growth strategies,
corporate governance and sustainability, and finance and balance sheet control, as well as discussing current management issues.
Furthermore, the number of affiliated companies increased approximately 150%, to 122, after the transition toan operating holding company.
The Board of Directors, whose effectiveness has been improving year by year, recognizes the important themesof promoting growth strategies that emphasize investment returns and building a solid financial base, risk management related to the expansion of overseas Group companies, and strengthening corporate governance. I focus on
making sure the Group pays close attention to the relationship between the overall strategy and the business portfolio, the differentiation strategy, the validity of feasibility studies and assumptions, and the appropriateness of postmerger integration of investment projects. In light of this, I will advocate for prudent yet bold decision-making andmonitoring of business execution from an independent and objective perspective, while contributing to proactive andprotective governance in response to management issues, thereby enhancing corporate value.
Opportunities to contribute to solutions to social issues and emerging needs through business activities are
increasing. With TIS’ status as a public entity, environmental, social and corporate governance (ESG) management
aims to balance and improve economic value and social value by giving consideration to the concerns of a wide
range of stakeholders. ESGE management (E for Economy) aims also to increase corporate value and thereby
enhance sustainability through portfolio management, and I want to participate by imparting a sense of priority andspeed. In the pursuit of sustainability, I will emphasize the process of developing strategies from our long-span,
deductive value-creating corporate image. I will also focus on human resource strategies that support this process
and on strengthening our ability to respond flexibly to continuous change.

Risk Management*Please visit the following page for details of our risk management
http://www.tis.com/ir/policy/risk/

The Group defines “risk” as “any factor that may hinder the achievement of the management philosophy, goals, andstrategies of the Company and the Group by causing economic loss; the interruption, stagnation, or suspension ofbusiness operations; and/or damage to the Company’s credit or brand image”.
The Company has established rules for risk management to ensure an accurate understanding of the risks facing theGroup and prevent losses from occurring. In accordance with these rules, we have appointed an executive to oversee risk
management of the entire Group, and a risk management department has been established to administer a risk management system. In addition, we have established a risk management policy for the entire Group and regularly check theimplementation status of measures to control risk. When a Group company becomes exposed to a serious risk, a task
force is set up and appropriate measures are taken to minimize damage.
As for the development of the risk management system, based on our basic policy and various rules governinginternal control systems, we are implementing specific measures for the maintenance and improvement of the internal
control of the entire Group, monitoring the development and operational status of the internal control system, deliberating at the Group Internal Control Committee, and developing a process to report the results of these deliberations to theBoard of Directors. The Group Internal Control Committee examines the risks faced by the Group twice a year, corroborating issues related to those risks and evaluating the status of reform measures. Based on its reports to the Board of
Directors, initiatives will be implemented to further strengthen and improve the Groupwide internal control system.

Financial risk

Management process diagram

Systemdevelopment

Risk items

Overview of risk

Main countermeasures

Owned securities

Sharp fluctuations in the market prices of marketablesecurities or deterioration in management conditionsof issuing entities requires the posting of accounting
losses or other similar measures.

• Thoroughly examine issuers’ financial condition, business results trends, credit ratings,
and other relevant indicators.
• Regularly review the suitability of our securities holdings and divest as soon as possible ifcontinued holding is deemed risky.

Hazard risk
Overview of risk

Main countermeasures

Pandemics (theglobal spread ofcommunicablediseases)

Risk items

A sharp constriction of the productive activities of ouremployees and those of our business partners.

• Keep abreast of the responses of the World Health Organization (WHO), the Japanese
government, and other relevant authorities.
• Take action to improve hygiene at our offices, data centers and other work sites, basedon the Group’s business continuity plan, and refrain from sending employees to work inareas heavily stricken by infection.
• Establish a work environment that facilitates working from home.

Natural disasters

A large natural disaster results in an extended power
outage that interrupts the smooth operation of data
centers.

• Make preparations to facilitate our data centers’ response to all manner of disasters.
• Close older data centers and focus on the development of state-of-the-art data centers
equipped with seismic-isolation structures, robust disaster-mitigation equipment,
emergency power generators, fuel storage equipment, and highly reliable electric power
equipment, and negotiate contracts for prioritized power supply.

Operational risk
Risk items

Risk occurrence frequency
Definition of risks
Subcategories

Items

Strategic risk

10

39

Financial risk

4

14

Hazard risk

39Operational risk

1040

Evaluation

Degree of damage

Main categories

1

2

3

4

5

Great

6

7

8

9

10

Large

5

6

7

8

9

Medium

4

5

6

7

8

Small

3

4

5

6

7

Slight

2

3

4

5

6

High risk
7–10 Prioritize the implementation of countermeasuresand constantly monitor risk trend
5–6

Medium risk
Implement countermeasures andcheck risk trends periodically

2–4

Low risk
In principle, adopt a wait-and-see stance

Priority risks shared by
all Group companies
Implement Group-wide response
Evaluate and improve(each fiscal half)
Review risks (each fiscal year)

Identify risks to be prioritized(mitigated) by the Group fromamong the high-risk items

System operation

Overview of risk

Main countermeasures

As systems development is growing more sophisticated and complex and turnaround times areshortening, extra work may be required in order toachieve the planned level of quality or complete theproject during the development period, leading toconsiderably higher-than-expected costs andcustomer claims for damages.

• Use our proprietary Trinity quality management system based on the ISO 9001 standard
to continually enhance quality management and raise productivity by using dedicatedworkgroups to thoroughly screen business proposals and review projects at each stage ofdevelopment.
• Through the Group Quality Executive Meeting, improve quality and promote production
innovation throughout the Group while also enhancing management and technologicalcapabilities by strengthening training programs for each employee position.

Tasks outsourced to business partners do not meet
expectations for productivity or quality and smoothproject management is not realized.

• Seek to secure superior business partners in Japan and overseas. That effort includes
regular meetings with our partners so that we fully understand their situation andcapabilities, and are able to build strong relationships.

System problems arise due to human error or• Develop a systems maintenance/operation framework based on ITIL (Information Technology
equipment malfunctions during system operation andInfrastructure Library) practices and improve system operation quality using this framework.
the Group is unable to provide services at the level• Establish and strengthen measures for early detection and confirmation of system failures
agreed upon with the client.
and measures to reduce and prevent the occurrence of failures.
• Establish and operate an information security management system based on ourInformation Security Policy that seeks to ensure appropriate information management.
• Raise employee awareness through education and training programs.
• Apply the Group’s information security promotion guidelines to evaluate the status of
information security management across the entire Group, and promote continuous
improvement in information security.
• When an information security breach does occur, take responsibility and establish an
investigative committee to look into the cause, implement countermeasures, and prevent
recurrence.
To protect personal information• Establish an information management system based on Japan’s Personal Information
Protection Act and establish regulations on the handling of information about specificindividuals.
• Conduct education and training programs for employees to raise awareness of theimportance of protecting personal information.
*TIS and other Group companies have obtained Information Security Management System(ISMS) certification and the JIPDEC PrivacyMark.

Legal systems,
compliance• Establish a compliance structure based on our Basic Direction on corporate social
responsibility (CSR) and Group Compliance Declaration and endeavor to conduct ourbusiness activities fairly and in compliance with all laws.
• In accordance with the Group’s compliance regulations, discuss important compliance issues
for the entire Group, decide measures to prevent recurrence, and ensure the adoption
throughout the Group by monitoring the status of the implementation of these measures.
Regulations on contracted work and temporary staffing• Work on a dedicated risk management system as Group priority because of the transactional nature of the IT services industry.
• Create Group guidelines and independent inspection checklists that will contribute to theappropriate operation of the system.
• To prevent illegal activities and detect and correct them at an early stage, introduce awhistle-blowing system and establish a reporting and consultation desk. Raise awarenessof legal compliance throughout the Group.

Strategic risk
Risk items

Overview of risk

Main countermeasures• With the aim of enhancing workstyle reform and employee motivation, strive to securetalented human resources by providing a corporate culture, HR systems, and an officeenvironment in which a diverse group of people can thrive.
• Focus on human resource training by providing support for acquiring certifications,systemizing training programs, and creating plans and targets for the number of training
days.

Human resources

High-quality human resources are not secured anddeveloped according to plan.

Innovation of
production
technology

Loss of competitive advantage and inability to provide • Constantly conduct research into information technologies as well as production andthe high-quality services that our customers havedevelopment technologies.
come to expect because we fail to take appropriate• Select from a broad technology portfolio the core technologies that will enable us to sustain
measures, or let our technologies and knowhow
and improve our development competitiveness, advance R&D and deploy the results.
become obsolete.
• Constantly carry out enhancement and innovation activities.

Intensification ofprice competition

Price competition may intensify, resulting in greaterthan-expected price competition.

• Constantly analyze the business environment to better grasp customer needs, offer
higher value-added services and take other measures to differentiate from competitors.
• Improve productivity by curtailing unprofitable projects and engaging in enhancement
and innovation activities.

Investment

Unanticipated changes in the business environment
result in investments failing to yield the expected
result or return, or make assets obsolete.

• All investment decisions are made after thorough examination of business plans by either
the Board of Directors, the CVC Investment Committee, or the Investment Committee,
depending on the investment project.
• Progress of each business plan is periodically confirmed after an investment has beenmade.
• Keep abreast of such progress by dispatching directors to larger capital investment partners.

Overseas business

63

Overseas business may be impacted by various
factors, including global economic and foreignexchange trends, legal regulations on investment andcompetition, local business practices, and labormanagement relations. One of these factors may
manifest itself in an unanticipated manner.

• Improve the management structure by ensuring coordination between overseas Group
companies and business sites and corporate management in Japan to maintain an
accurate understanding of local conditions and consult on ways to implement rapid
countermeasures.

A law or regulation is contravened, or a new law or
regulation is introduced.

Intellectual property The Group is accused of infringing another company’s • Strengthen our framework for intellectual property rights.
rightsintellectual property rights and presented with an• Conduct education and training programs to raise employees’ awareness.
injunction to cease use of the intellectual property* The Company regards its own intellectual property as an important management resource
concerned and a claim for damages.
and takes all necessary means to protect it.

Important notice
INTEC Inc., a consolidated subsidiary of the Company, is currently in litigation with Mitsubishi Shokuhin Co., Ltd., which filed a claim
for compensation in connection with services including systems development provided by INTEC Inc. (Amount of compensation
demanded: ¥12,703 million; date the complaint was received: December 17, 2018).
64

Platform that Supports
Value Creation Process

Information security Confidential information is leaked or manipulated
due to a computer virus, unauthorized access, orother reason leading to claims for damages fromclient companies and to a loss of trust in the Group’s
services.

Quality Control and Production Innovation

Aiming to be a “trusted top brand that epitomizes quality”
The TIS INTEC Group strongly recognizes the role that information systems play as social infrastructure. For this reason,
we work continuously to improve our quality, productivity, and technical capabilities.
By always providing high-value-added services while responding flexibly to diversifying business formats, solutions,development techniques, and technologies, we aim to entrench TIS INTEC as a “trusted top brand that epitomizes
quality” and realize the mission set forth in OUR PHILOSOPHY.

Activities aimed at improving standards of entire GroupThe TIS System Development & Quality Management Innovation SBU and the Technology & Innovation SBU are spearheading the following
activities aimed at improving the quality, productivity, and technical capabilities of the entire Group and harnessing Group synergies.
Group Quality Executive MeetingGroup Technical Reinforcement Committee

Undertakes the following activities to improve Group quality and productivity:● Establish PDCA cycle for setting and achieving KPI targets and monitor status of initiatives● Promote sharing and lateral development of issues, countermeasures, andknow-how of each company

Promotes sharing and effective use of eachcompany’s activities in order to strengthen
the Group’s development competitiveness

Deficit eradication

Enhancement innovation

Offshore promotion

Strengthen technical capabilities

Know-how and tool
sharing● Enhancement framework● Diagnoses, etc.

Sharing and lateraldevelopment ofoffshore promotion
measuresUtilize Fintan* and activate feedback*System development know-how/tool aggregation site

● Provide optimal services to earn the trust of customers.

Group screening● Proposal review● Review at start● Process inspection● Project review

Enhancement
activity presentation
Service manager
training

Shared use ofoffshore BP

the core.
● Use standard repetition and ingenuity to promote improvement activities aimed at enhancing
quality, productivity, technical capabilities, and competitiveness.

Sharing and lateral
deployment of project risk
management measures● Project management
training

TIS Quality Policy (from TIS “Quality Control Rules”)● Strive to improve stakeholder satisfaction, provide original and attractive services, and create

abundant value.

● Provide high-quality services through continuous business transformation with technology as

Revitalize canal**Technical support/Q&A service site
Introduce architect reviews to eliminate
technical risks

Events, such as
offshore colleges

Results in fiscal 2020, ended March 31, 2020
●TIS companywide review proposals: 104●TIS system development meetings: 213●Group Technology Enhancement Committee meetings: 11 ●Number of Group screenings: 145●Group Quality Executive Committee meetings: 29

Trinity: Original quality management system based on ISO 9001
We strive to provide customers with optimal services based on our policies of “emphasizing proficiency through on-site standardization and its repeated use” and “promoting improvement by minimizing essential implementation items and making use of
onsite ingenuity.” At development sites, we add ingenuity to suit each business model
while applying project management and engineering processes, techniques, and tools.
We are expanding the scope of coverage to include not only scratch development
but also a wide variety of business formats.
* Trinity means the “three elements of quality, productivity, and technological capabilities” and also
incorporates the notion of “customers, TIS, and partners” working together to improve those elements.
* For more details:
http://www.tis.com/group/csr/report/social/quality/

Enhance profit margin (TIS parent)

Development losses and loss rate (TIS INTEC Group)(100 millions of yen)
44.7
2.1%
18.7

Fiscal 2017

21.7

0.9%

0.9%

14.5
0.6%

Fiscal 2018

Fiscal 2019

Fiscal 2020

10.0
Fiscal 2021
(estimate)Continue implementing measures to eliminate losses and strengthen Group governance toprevent and control unprofitable projects → Improve profitability by reducing development
loss rates

Offshore outsourcing contracts (TIS parent)

10.6

Process

Project execution

Planning/
proposal

Plan

Design~development/
testing~transition

Enhancement(maintenance/
operation)

Termination

5.6

Fiscal 2017

Proposal
reviewStandard
contract
quotation guide
Planning/
Proposal

Project start
review

Process review(each process start/end)

Project management standard
Development process standard (Mode1/Mode2)
Quality control, project management, engineering
Human skills, management skills, expertise

65

Fiscal 2020

Fiscal 2021
(estimate)

Constantly improve profitability through companywide innovation and Group
resource redeployment

14.5

6.9

Fiscal 2018

Fiscal 2019

Fiscal 2020

Fiscal 2021
(estimate)

Fiscal 2017

Fiscal 2018

Fiscal 2019

Fiscal 2020

Fiscal 2021
(estimate)

Improved gross profit margin asa result of various measures

Companywide/organizational process reviews

Project risk
management

Education

Fiscal 2019

Gross margin on development (TIS parent)

Initiative 1: Use fewer contractors, especially major project participants (four major companies)
Initiative 2: Promote lab utilization for maintenance and enhancement work
Triple outsourcing contracts in four years. Achieve more than 10,000 work months.

Project monitoring (QCDR status) + Project health check (every 3 months)

Standardized
knowledge

12.4

Fiscal 2018

Platform that Supports
Value Creation Process(1000 work months)

Fiscal 2017

Project review(final report)

The gross margin on development sales has improved significantly, and we will continue ourefforts to prepare for the new normal.

Enhancement
framework

Service manager

Ikuo Shimizu
Executive Officer,
in charge of System
Development & Quality
Management Innovation SBU,
General Manager, System
Development & Quality
Management Innovation SBU,
TIS Inc.

The gross profit margin on development sales has improved significantly in recent years as a result of the steady implementation of various
measures to eliminate losses, enhance innovation, and promote offshore activities. This improvement in business profitability is reflected not
only in the Company’s results but also in those of the Group as a whole, as our transition into a business holding company structure accelerated
innovation and strengthened systems to promote efficiency at Group companies.
Although the business environment is highly uncertain due to the COVID-19 pandemic, we will continue to rely on our Trinity quality
management system, testing the true value of this monitoring process. Trinity was developed as a quality management system that prioritizes
the realization of customer requirements in a traditional systems integration sense. However, in the service provision business, which our Groupis focusing on, we need to set our own service quality standards as well as respond to market demands and social imperatives. We will continue
to develop Trinity in line with these business parameters.

66

Communication with Employees

Continuous enhancement of value exchanges between employees and the Company

Diversity and Inclusion Policy

We will continue to enhance the exchange of value between employees and the Company through a virtuous cycle of investment, growth,and high added value.

In fiscal 2020, ended March 31, 2020, the TIS INTEC Group introduced its Diversity and Inclusion Policy and Health Management Policy as
initiatives designed to improve the caliber of people and the performance of Group companies, and to solidify a corporate culture based on
OUR PHILOSOPHY.

● Value provision and results as professionals(Creating value commensurate with compensation)

Employees● Growth opportunities (attractiveness of the job)/increase market value● Top-level compensation in the industry

Investing in people

Company● Increase compensation in anticipation of improved added value

Raising compensation levels to those ofindustry majors● Vigorous investment in training● Increase in PH metrics (increase financial

value) by realizing higher added value

Growth of humanresources

PH profit and sales
improvement

Enhancing added
value in businesses
and operations

Health Management Initiatives
To lead an enriching and happy life is important for each and every
employee, and will lead them to work more enthusiastically andproductively. In accordance with the Group’s health management
policy, TIS is promoting activities specifically targeting improvement in
the quality of employees’ lives.

Virtuous cycle of value
exchange between employees
and the Company
Increase added value

The TIS INTEC Group values diverse human resources and encourages staff members to demonstrate theirindividuality by freely expressing their opinions. We will continue to promote diversity and inclusion
through human resource engagement activities, proactive health management and workstyle reform. Our
aim is to motivate the workforce and continue to foster flexible, continuous change and untapped value.

● Shift to high-value-added businesses and operations● Improved employee experience

Mental andphysical health
Improving thequality of life
Increasing earning
power

Boosting motivation■ Improving health literacy

●We continue to provide employees with information and educational opportunities so that they can be more informed about and■Collaborative health ●We encourage open communication to create a cohesive organization, and a comfortable and secure workplace.
●We have collaborated with the Health Insurance Association to raise employee awareness of health issues and implement healthengaged with their health.

initiatives

promotion measures.

Timely utilization of human resources at the front lines■Health management●We provide opportunities for health checkups, comprehensive medical examinations, and stress checks, and achieved a 100% checkup

We are working to strengthen our human resources management in order to increase added value through performance development
initiatives targeted at every employee. We promote management aimed at achieving business goals while at the same time boosting theskills and motivation of employees.

■Support for a healthy ●We established a system to help balance work with childcare as well as other caregiving and medical treatment, with provision of

Pursuit of performance development that promotes employee engagement and self-directed growth,shifting from a corporate culture of micromanagement to one that supports employees’ professional
development.
Performance development – a virtuous cycle

Agile, front-lineoriented responses

Candidate discovery
and recruiting activities

Flexible workstyles●Enhance 1-on-1 interactions (Training anddevelopment)● Entrench peer bonuses● 360-degree feedback (expansion of scope)● Coaching (Boss Style)● Increase flexibility in work schedules and locations● Encourage new workstyles with an eye on the

post-COVID-19 era

Systems and programs
that are responsive tobusiness needs

programs

consultation services and practical support.

●We have stipulated an 11-hour gap between work shifts to prevent burnout as well as to improve concentration and performance.
●We offer welfare services that employees can use to promote their well-being and a long-term disability (LTD) program (incomecompensation insurance).

Advancement of diverse talent
In order for the human resources who will drive structural change to be true to themselves, it is essential to create an organizational culturethat respects and embraces difference, such as in values and living circumstances, as well as age and sexual orientation. For women andsenior citizens in particular, on whom there may be high social demands, we strive to develop systems and environments that make it easierfor them to fulfil their potential. We also foster a culture in which differences are embraced through workshops aimed at developing
people’s abilities and careers.
■ Contributions of the senior generation
■Employment of people with a disability●In addition to the abolition of the retirement age for company posts, we have introduced an optional retirement system for employees

up to age 65. We are also promoting age-specific career education to help employees visualize their future careers.

●In fiscal 2021, ending March 31, 2021, we introduced the “Elder Employee System” which enables the re-employment of retired

employees until the age of 70.

●Through SorunPure, a specially recognized subsidiary, we employ many people with disabilities and createa rewarding work environment for them.

■Women’s empowerment●We are working to create an environment in which women can play an even more active role in the Group through career support aimed● Strengthen the workforce through human●We provide guidance and consultations to prepare women for life events and to promote career development after women return● Introduce a new HR system● Introduce the HR Business Partner system■Support for LGBTI+

resource developmentat promoting female managers and directors, the formation of promotion guidelines, and the establishment of a women’s network.
from maternity leave.

●We have established a system that ensures equality of treatment of employees with nontypical gender identity or sexual orientation,and introduced measures to prevent harassment

We will continue to evolve our system with an easy-to-understand message that isfriendly to our employees.

Kyoko Takayanagi
Executive Officer, Department Manager of
Human Resources Department,
Deputy Division Manager of
Human Resources SBU, TIS Inc.

67

When I was appointed to the Human Resources SBU in April 2019, the TIS workstyle was based on the “Human Resources SBU
Manifesto” and to a certain extent had been set in stone. As a first step, we prioritized the devolution of workstyles to individual workplaces and employees. To assist each employee to understand and put into effect human resource initiatives, we zealously conductedtraining programs for all executives and consulted with junior employees, and have instituted a number of measures aimed at providing
know-how and raising employee awareness of the need for self-realization (for example, employing 1-on-1 and 360-degree feedback). As
a result, I feel that the understanding of employees has steadily improved over the past year. More than anything else, it was a year inwhich I felt the joy as Department Manager of being able to see employees actively utilize our programs and work energetically.
At the start of fiscal 2021, we were forced to focus on working at home due to the COVID-19 situation, and we questioned the results of the measures we had taken so far.
We are confident that the current TIS environment and systems are advanced enough to be as close as possible to the new ways of working that we are aiming for in the
COVID-19 era, and this has given us great confidence. We are now in a position to significantly change employees’ sense of values and further evolve our programs to help each
employee achieve self-realization. At the same time, we will continue to provide easy-to-understand messages tailored to the needs of our employees.

68

Platform that Supports
Value Creation Process

Revitalize communication
Strengthen management
capabilities

Flexible and timely
performance reviews
and job transfers

Flexible workstyles,
coaching and feedback

Key points

work-life balance■Work-interval system■Enhancement of benefit 

rate. Health consultation and counseling services have also been established.

Communication with Clients and Business Partners

Major Group Companies’ Initiatives to Promote Female Employees (Five Major Companies)*Excerpted from action plans for “the promotion of female participation and career advancement” published by each company.
Company namePlan duration

Goals during the plan period• Percentage of female directors: 9.0%
• Percentage of female employees in management
positions: 12.8%• No workers who work an average of 60 hours ormore of overtime per month over a fiscal year,
including those in managerial positions

TIS Inc.

Four years(April 2020 toMarch 2024)

INTEC Inc.

Five years(April 2016 to
March 2021)

AGREX INC.

Three years(April 2019 toMarch 2022)

QUALICA Inc.

AJS Inc.

Five years(April 2016 to
March 2021)

Five years(April 2016 to
March 2021)• Percentage of female employees in management
positions: 7% or higher

Outline of measures
1. Guidelines for the promotion of women will be set in the “pipelinemanagement process” for the development of senior management, andfemale candidates will be targeted for development• Assess candidate status and confirm future development policies• Selection of candidates and formulation of development plan for eachorganization
2. Guidelines will be established for promoting female employees andmeasures will be taken to raise awareness of opportunities among
candidates
3. Ascertain the status of the average overtime hours of workers, including
managers, and provide guidance on corrective measures if necessary• Monthly provision of actual values by department, strengthening ofacquisition of objective records, monitoring by personnel andguidance for improvement• Dissemination of workstyle reform-related program and fostering a
corporate culture (continuation of current measures)
1. Hold exchanges across departments
2. Conduct interviews with employees before and after returning to work
following maternity leave
3. Establishment of medium- and long-term career goals for young female
employees• Create a system to promote more women to
managerial positions, aiming to increase thepercentage of women in managerial positions to atleast 25%

1. We will further promote reform of workstyles in order to create anenvironment in which employees with time restrictions can play anactive role and to change the mindset of both employees and managers
2. Promote measures to support the career development of female
employees• Percentage of female employees among new
graduate hires: 30% or higher• Percentage of female employees: 20% or higher• Percentage of female employees in management
positions: 8.5% (15) or higher

1. In order to increase the number of female applicants, the company will
strengthen information dissemination for female students through its
own website and recruitment websites
2. Support career advancement for female employees and the creation of
networks among female employees
3. Create an environment in which women can work stress-free and play
more active roles in the company, and conduct human resource
management training• Facilitate female employees’ promotion to managerial
positions• 10% increase in the number of candidates for
managerial positions versus fiscal 2016

1. Launch women’s career development project
2. Implement various programs to raise awareness of women’s
participation in the workplace
3. Encourage employees to participate in training on requirements forpromotion

Becoming an Irreplaceable Partner for Our Customers
TIS INTEC Group Business Summit 2019 – Exciting Future
In July 2019, the TIS INTEC Group held the TIS INTEC Group Business Summit 2019 –Exciting Future in Tokyo. A total of 1,238 clients attended the event, where we presented
our Group’s advanced technologies and various initiatives through sessions andexhibitions. (We have decided not to hold the event in fiscal 2021 in light of the COVID-19
situation.)

Implementation of Customer Satisfaction Survey
TIS Inc. conducts an annual Customer Satisfaction Survey for customers withwhom it does business on an ongoing basis to gauge our performance fromthe customer’s perspective. In fiscal 2020 we received high marks for ouractivities aimed at realizing our vision of becoming “A business partner
contributing to our customers’ business expansion.” In the survey, 72.7% ofcustomers answered that we were “An irreplaceable business partner” basedon a score of 4 or higher on a scale of 1 to 5. Yet there is still room for
improvement, as shown responses to the question on “Proactive proposals,
information provision, etc.”, and we are working to improve this aspect of ourservice provision companywide. We will continue to solicit feedback and listen
to our customers to further improve our contribution as a business partner.

Percentage of respondents who answered“An irreplaceable business partner”(based on a score of 4 or higher on a scale of 1 to 5)

72.7%
69.1%

68.2%

Fiscal 2018

Fiscal 2019

61.3%
Fiscal 2017

Fiscal 2020

Strengthening Relationships with a Wide Range of Partners
Convening TIS Business Partner Socials
TIS holds TIS Business Partner Socials in Tokyo, Osaka, and Nagoya every year to thank its business partners for their ongoing patronage.
More than 100 major business partners regularly participate in these events. We also use these events to introduce TIS’s management
policies, share the direction that TIS is heading in, and express our expectations of our business partners in order to strengthen our
relationships with them.
* In 2020, in view of the spread of COVID-19, social gatherings were cancelled and instead letters and commemorative gifts were presented to business partners.

Platform that Supports
Value Creation Process

Programs to achieve flexible workstyles
By increasing employees‘ options regarding working hours and location, we will maximize performance, improve the quality and speedof results, and reduce overheads. At the same time, we will foster opportunities for self-awareness and autonomy by allowing employees
to control the pace of work and coordinate on and off time according to their own needs and initiative.
The various systems of workstyle reform have been rapidly implemented under COVID-19 conditions.
Moving forward, we will continue to provide flexible options that will contribute not only to the realization of work-life balance forindividuals, but also to the growth of each individual and the development of our business.
■ Flextime working system ●In principle, all employees can use flextime without core time. Employees who work for two hours are deemed to have worked for

one day.

■Teleworker system●We encourage telework (in a secure environment) at satellite offices, shared offices, and at home.
 ●Employees can apply to work as a teleworker who does not come to the office.
■Discretionary work program ●We have adopted a system in which employees have the discretion to perform their jobs in a self-directed manner in departments

responsible for research, consulting (strategy and IT), new business creation, etc.

■Work smart allowance■Taking time off●We have introduced a “deemed overtime allowance” to enhance employees’ value-added through the more effective use of time.
●The Group has set targets for the use of annual leave to promote the use of such leave. Refresh leave to encourage the taking of●We have our original programs, such as volunteer leave with pay and backup leave for unexpected needs.

consecutive days off

Base for the Promotion of Open Innovation EstablishedEstablished in September 2016, bit & innovation is a communication space that brings together the resources of startups, operatingcompanies and TIS INTEC Group companies to create new businesses through open innovation. This initiative enables us to facilitate
collaboration across corporate boundaries.
http://bit-innovation.tis.co.jp/
Location: Nishi-Shinjuku, Tokyo
Number of members (as of July 2020): about 300 companies* and 950 individuals*Total of both startup and operating companies
Application● Co-working● Meetings● Program acceleration site
● Holding various events such as pitches and ideathons

Disclosure of sustainable procurement policies
The TIS INTEC Group believes that in order to fulfill its social responsibilities, it is important to collaborate with stakeholders to implement
measures throughout the entire supply chain. Accordingly, the Group discloses its sustainable procurement policies. For more information,
visit the following link: http://www.tis.com/group/csr/report/governance/procurement_policies/.
69

70

Communication with Shareholders and Investors

Communication with Communities and Society

Fast, fair and impartial information disclosure, and dialogue with shareholders

Our Group engages in multifaceted initiatives in cooperation with local communities and society at large under the themes of social
welfare, environmental conservation, sports, arts and culture, contribution to local communities, and fostering the next generation.

We provide performance results and the latest news on our business activities through events, such as information meetings, theproduction of pamphlets, and engage in constructive dialogue with shareholders and investors for the Company's sustainable growth.
IR Events in Fiscal 2020

Frequency

Results briefings for analysts and institutional
investors

4 timesQuarterly briefings

Business briefings for analysts andinstitutional investors

Once

Held a meeting regarding payment business

Small meetings for analysts and institutional
investors

245 times

Contents

Provide IR-oriented information for analysts and institutional investors. Of these meetings, 81 werefor overseas investors. Total coverage: 291 companies (395 people)

Small meetings

Once

President held one meeting with sell-side analysts

Overseas roadshows

3 timesPresident, director responsible for overseas IR and other members of senior management met withshareholders and investors in Europe, United States, and Asia

IR conferences for individual investors

Once

Held a conference in Tokyo (334 participated people)

Production of materials for individual investors

2 timesIssued “Business Report”*Please visit the following page for details of our Group activities.
http://www.tis.com/group/csr/report/social/community/

Major Activities
Smile Kids Camp—Supporting Seriously Ill andDisabled Children and Their Families

Taking Part in Asahi no Mori Forest
Conservation ProjectThis itinerant event for children with serious illnesses or disabilities andtheir families is planned and undertaken by a committee of volunteers.
Employees from TIS INTEC Group companies volunteer their time to staff
the event, providing a valuable opportunity to witness the real difference
made by CSR and volunteer activities.

From 2010, AJS has been supporting the Asahi no Mori forest conservation project in the northern part of Miyazaki Prefecture spearheaded by
Asahi Kasei Corporation. The aims are to prevent global warming, protect
the natural environment and also contribute to the prefecture where thecompany’s office is located.

Performances by Friends of Music Society

Fostering the Next Generation

TIS INTEC Group Gakuyukai (Friends of Music Society) is a registeredensemble mainly comprising employees of the TIS INTEC Group andfamily members. It performs lunchtime concerts in the Tokyo head officebuilding and at local recital halls.

●Internships for college students
We offer internships to help university students with career planning andas an opportunity to gain work experience. To date, the program has
provided opportunities to more than 1,000 students.

Initiatives to revitalize General Meetings of Shareholders and facilitate the exercise of voting rights
Contents
Early dispatch of notice of General Meetings ofShareholders

Based on our policy of sending the notice at least three weeks before the General Meeting of Shareholders, we sent thenotice of convocation for the 12th Annual General Meeting of Shareholders scheduled for June 24, 2020, on June 2, 2020.

Setting dates for the General Meeting of Shareholders that avoid clashes with other suchmeetings

The date has been set so as to make it easier for more shareholders to attend the General Meeting of Shareholders.
The latest General Meeting of Shareholders was held on June 24, 2020.

Voting by electronic means

We have adopted an electronic voting system that allows voting rights to be exercised via the Internet and othermeans (PC, smartphone or cell phone).

Participation in electronic voting platforms andother initiatives to improve the environment for
institutional investors to exercise voting rights

We participate in the voting platform for institutional investors operated by Investor Communications Japan (ICJ, Inc.).

Provision of Notice of Convocation (summary) in
EnglishA Notice of Convocation of the General Meeting of Shareholders (in Japanese and English) is posted on the corporatewebsite.

Other

The Notice of Convocation is disclosed prior to distribution on the corporate website. Based on our policy of disclosing
the convocation notice about one month prior to the date of the General Meeting of Shareholders, we disclosed theconvocation notice of the latest General Meeting of Shareholders on May 20, 2020.

IR Policy
Purpose of IR Activities

As part of its pursuit of fair and transparent management, the Company
engages in investor relations activities in order to fulfill its accountability
obligations to not only the shareholders who entrust management to it, butalso to investors, securities analysts, and capital market participants ingeneral. By engaging in proper disclosure and constructive dialogue throughits investor relations activities, the Company also aims to promote
understanding of the Group, develop long-term trusting relationships, andearn fair valuations of its corporate value.

Basic Policy on IR Activities

Recognizing that investor relations activities are an important element of its
management activities, the Company is committed to fulfilling its accountability obligations to shareholders, investors, securities analysts, and othercapital market participants and to building trusting relationships based on
full communication achieved through ongoing conscientious and positive
engagement in investor relations activities.
To promote understanding of the Group, the Company will endeavor todisclose and explain its management policies, details of its business
operations, business strategies, earnings performance, finances, and othercorporate information in a timely, fair, accurate, and clear manner byparticipating in interviews and responding to inquiries pertaining to investor
relations, holding earnings briefings and small meetings, and engaging inother such activities. Opinions and other feedback on the Group obtained
through constructive dialogue will be shared within the Company throughreports to the Board of Directors and similar channels, and will be used for
purposes such as reviewing the Company's management strategies.
71

Basic Policy on Disclosure

1. Disclosure Standards
To ensure transparency by promoting information disclosure, the Company
discloses material information that could influence investment decisions,
including information disclosed in conformance with the Securities Listing
Regulations of the Tokyo Stock Exchange and the Financial Instruments andExchange Act (meaning information on decisions made by the Company,
occurrences of material facts, and business results and similar information;
the same applies hereinafter). In addition to the above, the Company also
discloses, to the maximum extent possible, information judged useful forfurthering understanding of the Company and the Group.
2. Information Disclosure System
The Company has developed a communications structure linking divisions
and member companies of the Group, and it has established a structure fordisclosing material information that could influence investment decisions,
including information disclosed in conformance with the securities listing
regulations of the Tokyo Stock Exchange and the Financial Instruments andExchange Law, in a fair and timely manner. The Company is committed torigorous information management and preventing insider trading.
* Please see the Company’s web site regarding “3. Methods of Disclosure”,“4. Spokespersons for Investor Relations Activities”, “5. Yet-to-Be-Released
Material Information”, “6. Quiet Period”, “7. Response to Rumors, etc.”,“8. Earnings Forecasts, etc. by Third Parties”, “9. Framework for Disclosing
Information on Company Website” of Basic Policy on Disclosure.
http://www.tis.com/ir/other/policy/●Linkages with Universities (Student Development)
At Keio University, we fund an endowed course entitled “Overview ofEntrepreneurship” in which case studies of entrepreneurs and companies, lectures on laws related to the creation of new business, andsimulated business creation experiences are provided to nurture
entrepreneurial talent. We also offer courses to support students’ careerdevelopment at Ritsumeikan University, Aichi Prefectural University andDoshisha University, among others.

Signatory to the UN Global Compact
TIS—and by extension, the TIS INTEC Group—signed on to the U.N. Global Compact and was registered as aparticipant as of July 19, 2018. Through strategies and actions in line with 10 principles encompassing four
categories—human rights, labor, environment and anti-corruption—we encourage every employee to get
involved in fulfilling our corporate social responsibilities and promote activities that support sustainable social
development.

72

Platform that Supports
Value Creation Process●Corporate training for teachers
This is a program where teachers receive training at private companies
during their summer vacation. TIS has participated in a program run by
Keizai Koho Center, an organization affiliated with the Japan Business
Federation (Keidanren), and has welcomed more than 70 teachers since
2010.

Contributing to Global Environmental Protection*Please refer to the link below for more information on our environmental initiatives.
http://www.tis.com/group/csr/report/environment/#e00

Initiatives to Reduce Environmental Impact
Our Group recognizes that environmental issues have become important for all humankind and is actively involved in environmental
protection through its business activities. Against a backdrop of growing international concern for the environment in recent years, in fiscal
2020 we formulated an environmental vision and policy and established an environmental promotion system.

The TIS INTEC Group is taking an environment-conscious approach at offices and data centers, which form the bedrock of corporate
activities, by introducing measures to save energy and cut greenhouse gas emissions.
Examples of Environment-Friendly Activities at Data Centers● Outdoor air for cooling

Creating a Vibrant, Environmentally Conscious Society

Tsuneyoshi Ito
Executive Officer,
Division Manager ofCorporate Management SBU,
TIS Inc.

Our vision for a bright future cannot be realized without enriching the global environment in which we live. Yet the current global environmental issues are now so complex and serious that they require a global approach. The TIS INTEC Group has been adopting business practices thatare appropriate for this new era, taking into consideration initiatives such as the UN’s Sustainable Development Goals (SDGs), the Task Force on
Climate-Related Financial Disclosures, the Carbon Disclosure Project, Science-Based Targets, and RE100 (a global corporate renewable energy
initiative bringing together hundreds of large businesses committed to 100% renewable electricity). In 2019, we completely overhauled our
promotion structure. We have also launched initiatives to integrate environmental measures with business activities in recognition that mediumto long-term perspectives and strategic activities are essential to solving global environmental issues. During the next medium-term management plan, we will prioritize businesses that use our Group’s digital technologies to help improve the energy efficiency of society as a whole,and make stringent efforts to reduce greenhouse gas emissions in our Group‘s business activities. We will continue to advance our Group‘sinitiatives by disclosing information on our progress as compared with global standards.

Environmental
VisionThrough our corporate activities and the provision of new services, we aim to be a company
that infuses the global environment of the future with vibrant colors.

Environmental
Declaration

We recognize that addressing global environmental issues is one of our most importantpriorities as a responsible member of society. In order to realize the mission of OUR
PHILOSOPHY, we formulated our Environmental Vision to reflect our long-term environmental goals. To achieve this vision, we established a set of Environmental Action
Guidelines. Through our various corporate activities, all of our executives and employees
will strive to reduce their environmental impact and foster protection of the global
environment.

Environmental
ActionGuidelines● LED lighting● Use of geothermal energy● Optimized lighting with motion sensors and ambient light sensors● Use of rainwater● Highly efficient equipment● Use of well water● Rooftop greenery● Lighting equipment run on solar power● Landscaping● Green power procurement● External appearance harmonizing with the local surroundings● Natural lighting● Noise-damping, heat-insulating sashes

Natural light (solar tracking equipment)

Solar power generation monitor

Rooftop greenery

Examples of Environmentally Conscious Activities at Offices● Employing more environmentally friendly air conditioner settings● Going paperless (monitors set up in meeting rooms)● Stopping running air barrier fans

● Recycling PCs● Switching power off on machines, such as copiers and shredders, during periods of non-use● Confidential documents being solution-treated by a provider● Turning off heating in washrooms, and disabling hot water setting● Garbage being sorted for appropriate and in disposal● Banning vehicle idling● Participating in eco-cap movements● Ensuring water taps are closed● Partnering in Table for Two program● Encouraging use of stairs instead of elevators● Turning off lights in work areas during lunch hour and● Ending superfluous wrapping

unused and absence areas● Reducing use of lighting● Encouraging employees to use personal thermos bottles and reusable shopping bags
● Encouraging employees to take vacation during summer

Platform that Supports
Value Creation Process

1. Contribute to environmental conservation through business activities
2. Reduce environmental impact through the value chain
3. Comply with environmental laws and regulations and management initiatives
4. Pursue initiatives aimed at sustained improvement
5. Promote awareness and full participation
6. Disclose information to engender trust from society● Cool Biz

Case study: Start of joint proof-of-concept experiments at stores for distributed energy resource
Based on these Action Guidelines, we have acquired ISO 14001 certification, an international standard for environmental management, at
our offices and data centers. We are promoting continuous improvements based on ISO 14001 standards and are working to establish anenvironmental management structure for the entire Group.

Energy conservation initiatives
At our data centers and offices, which account for the bulk of ourcorporate activities, we are promoting initiatives that take theglobal environment into consideration, such as measures toconserve energy and reduce greenhouse gases. We are integrating
and concentrating our data centers into high-spec, environmentallyfriendly data centers with high energy efficiency, employing
measures such as outdoor air for cooling and rainwater utilization
as well as use of renewable energy (geothermal power utilization,
solar power etc.).

Changes in electricity consumption

167,907150,000

25,273

157,623
25,171

149,523
25,734

143,383
24,119100,000
142,634

132,452

50,000

0

73

(Mwh)

200,000

123,789

119,264

Fiscal 2019

Fiscal 2020

generation

Since February 2020, in cooperation with Kansai Electric Power Co., Inc., TIS has been conducting
a series of proof-of-concept experiments at stores to employ distributed energy resources (DER)– small-scale electricity generation and use at source. These
Overview of proof of concept experiments
facilities will use solar panels to harness a renewable energy
for distributed energy resource control
source and batteries for energy storage. Solar power generation
doesn’t emit CO2, but the amount of power generated by solar
Distributed energy resource
panels depends on the weather. By installing storage batteries
control system
together with solar panels, excess power can be stored when
Performance report
Control orders
there is a large amount of power generation and used asneeded. This project aims to demonstrate the value ofReal store
distributed energy resources and maximize the efficiencyof energy management, in the process contributing directly
to a low-carbon society as well as to business continuity
planning (BCP).
Solar panels

Fiscal 2017

Fiscal 2018

Data centers

Offices

Storage battery*Please visit the following page for details (Japanese only).
https://www.tis.co.jp/news/2019/tis_news/20200219_1.html

74