CORPORATE GOVERNANCETECHMATRIX CORPORATION

Last Update: June 27, 2023

TECHMATRIX CORPORATION

The following is an overview of corporate governance at TechMatrix Corporation.

President and CEO: Takashi Yuri
Inquiries: +81-3-4405-7802
Securities Code: 3762
https://www.techmatrix.co.jp/en/

Ⅰ Basic Policy on Corporate Governance, Capital Structure, Corporate Attributes and Other Basic Information
1. Basic Policy

TechMatrix Corporation (“the Company”) views increasing its corporate value as a top priority, and strives to maintain and enhance its competitiveness,
as well as maximize the added value it can provide to customers. To this end, the Company believes that enhancing management transparency andimproving management efficiency to enable strategic and speedy management decision-making are the foundations of corporate governance. Basedon this basic policy, the Company is working to realize a highly transparent management structure through the participation of Outside Directors andto conduct management decision-making and rapid and appropriate business execution through the separation of management decision-making andthe supervision of business execution from the business execution system. The Company is also striving to realize adequate supervision and auditingof management and business execution.
Moreover, the Company also believes that measures to strengthen compliance are an important priority for fulfilling its responsibilities as a corporate
citizen.

The Company discloses information on all principles in accordance with the Corporate Governance Code, which was revised in June 2021.

【Reasons for Not Implementing Principles of the Corporate Governance Code】
The Company implements all principles set forth in the Corporate Governance Code revised in June 2021, including matters for publicly listedcompanies on the Prime Market.

【Disclosure Based on the Principles of the Corporate Governance Code】【Principle 1.4 Cross-Shareholdings】
The Company’s basic policy is to hold cross-shareholdings to establish and strengthen stable relationships with important business partners. If theCompany judges that cross-shareholdings will not help to improve its corporate value or develop its businesses, the Company will reduce such crossshareholdings. In light of the above policy, the Company reviews whether or not it will hold cross-shareholdings as necessary. In the Board of Directors
meeting held on June 24, 2022, the Company reclassified certain cross-shareholdings as investments for pure investment purposes.
Moreover, in terms of its standards for exercising the voting rights of cross-shareholdings, the Company decides whether to vote for or against
individual proposals based on careful consideration of each individual proposal, from the perspective of whether its content will serve the efficient andsound management of the issuing company, and whether it can be expected to improve corporate value, among other viewpoints, as well as determining
whether the Company’s corporate value could be impaired or there are any important concerns about corporate governance.
【Principle 1.7 Related-Party Transactions】
The Company has set forth in its Rules of the Board of Directors that transactions by Directors which may compete with the Company or transactions
involving conflicts of interest must be deliberated and approved by the Board of Directors. In those rules, it has also set forth that if such transactions
are undertaken, they must be reported to the Board of Directors. Furthermore, once a year, the Company conducts a questionnaire survey about relatedparty transactions covering the Directors via the Secretariat of the Board of Directors. Through this survey, the Company properly monitors the statusof any changes in concurrent positions held by the Directors and checks the status of any transactions with the Company.
【Principle 2.3 Sustainability Issues, Including Social and Environmental Matters】
The Company recognizes that its response to sustainability issues, including climate change, is an important management issue, and it has establisheda system that enables the Board of Directors to exercise more appropriate supervision. The Sustainability Committee, which reports to the Executive
Committee, the body responsible for overall business execution, manages progress on the response to climate change. The Sustainability Committee
works closely with the Corporate Planning Dept., which is in charge of environmental management, to supervise the climate change response measuresand related planning at each division, headquarters, department, branch and sales office. The Sustainability Committee comprises appointed membersof departments within the Corporate Headquarters. The Executive Committee discusses the current status of progress on these activities or important
issues. Following these discussions, these issues are reported to and discussed by the Board of Directors at least once a year, and they are reflected inand aligned more closely with the Company’s management strategy.
(ESG Information: https://www.techmatrix.co.jp/en/ir/esg/index.html)【Principle 2.4 Ensuring Diversity, Including Active Participation of Women】
The Company believes that having diverse perspectives and values that reflect different experiences, technical abilities and personal attributes within
the Company will energize the organization, maintain flexibility and enhance the Company’s abilities, and that this will enable it to achieve sustainablegrowth. Based on this belief, 2 female directors were elected at the 36th Ordinary General Meeting of Shareholders held in June 2020. Their election
has reinvigorated discussions on the active participation of women in the Company even more than before.
In terms of recruitment activities, under a basic policy of ensuring diversity, the Company strives to secure diverse human resources regardless ofgender, nationality, or other attributes. In October 2017, the Company introduced a work-from-home system for all employees. The Company has also
introduced the Life Event Support system that allows employees to flexibly select where they will live even if they have no choice but to move far

away due to a life event such as marriage, child raising, nursing care or a job transfer of a spouse or other family member living in the same home. A
flex-time system has also been rolled out. In these and other ways, the Company is actively working to design systems and create environments inwhich women and their spouses can work comfortably and productively, such as childcare leave, child raising support leave, partial subsidies fornursery facility usage fees, and shortened work schedules. In addition, the Company strives to develop comfortable and productive work environments
for its employees. In accordance with the Act on Advancement of Measures to Support Raising Next-Generation Children, the Company has formulated
and promoted a General Employer Action Plan with the aim of developing workplaces where employees can demonstrate their full abilities whilebalancing career and child-raising responsibilities. As a result, the Company is currently certified as a general employer that meets standards based on
the Act on Advancement of Measures to Support Raising Next-Generation Children.
【Supplementary Principle 2.4.1 Ensuring Diversity in the Promotion to Core Human Resources and Related Matters】
Regarding diversity in human resources, the Company believes that having diverse perspectives and values that reflect different experiences, technicalabilities and personal attributes within the Company will energize the organization, maintain flexibility and enhance the Company’s capabilities,
thereby enabling the Company to achieve sustainable growth.
With this in mind, the Company has adopted human resource development/organizational development (including promotion of diversity) as one ofits key strategies in the new Medium-term Management Plan “BEYOND THE NEW NORMAL,” which was announced on May 10, 2021.
Furthermore, the Company established the Diversity & Inclusion Department in July 2022. The D&I Promotion Office has accelerated a wide range
of initiatives to raise diversity and inclusion awareness and achieve diversity and inclusion.
Another priority is to appoint women, non-Japanese individuals and mid-career recruits to management positions. The Company aims to increase thefemale manager ratio to 20% by the end of FY2030 (versus approx. 6% as of the end of FY2022). To achieve this target, the Company has beenworking to increase the female recruitment ratio for new graduate and mid-career recruits. The ratio of women to all workers recruited in FY2022
reached approximately 33%. The Company will work to increase the female employee ratio to 30% by the end of FY2026 (versus approx. 25% as ofthe end of FY2022).
In terms of the recruitment of non-Japanese individuals and their appointment to management positions, the Company has been able to recruit a certain
number of non-Japanese individuals at this time. However, the number of non-Japanese applicants is still limited. For this reason, to increase thenumber of non-Japanese managers, the Company will raise the share of non-Japanese employees in the workforce by recruiting such individuals as it
expands its overseas business. In the process, the Company will make efforts to recruit management personnel or train non-Japanese employees.
Looking at the appointment of mid-career recruits as managers, mid-career recruits account for a large share of recruited personnel in the Company’s
recruitment activities. Currently, the Company appoints mid-career recruits to management positions in a timely and appropriate manner, evaluating
their suitability by comparing the requirements of each position with the abilities, aptitude and experience of each individual candidate.
Going forward, the Company will work to optimize the composition of managers by type of recruitment, nationality, and gender.
As part of the Company’s policy on human resources development to ensure diversity, the Company has been making efforts to develop next-generation
leaders and advanced IT personnel for the future. In addition, the Company has been providing support to balance child raising and work, as well as
implementing measures to support women’s career development and enable them to demonstrate their abilities in management and as specialists, suchas holding women’s career seminars. Moreover, as part of its policy on creating an internal environment, the Company seeks to realize newcommunication styles and flexible work styles that maximize employees’ potential abilities. To this end, the Company has introduced a system thatallows employees to select days when they will work in the office and days when they will work remotely. Additionally, the Company has implemented
a free-address office system with no assigned workstations or seating at its new office, which it moved into in December 2022. With this step, theCompany has created an office environment in which optimal collaboration can be achieved across organizations and job roles.
【Principle 2.5 Whistleblowing】
The Company has formulated the Compliance Standards of Conduct and strives to ensure compliance with laws and regulations and adherence tocorporate ethics. Based on the Compliance Standards of Conduct, in the course of corporate activities, the Company strives to identify matters thatpose a risk of violating laws and regulations and corporate ethics as specifically as possible, educate and raise the awareness of officers andemployees, and rigorously enforce compliance with laws and regulations and corporate ethics, along with making improvements as necessary. As
such an organization, the Company has established the Compliance Committee chaired by the President, who is the general supervisor of thecompliance system. In addition, the Company has established a whistleblowing system, and the Board of Directors supervises the operation of thesystem.
Additionally, in accordance with the enforcement of the amended Whistleblower Protection Act in June 2022, the Company has established internal
rules on whistleblowing. These internal rules are being extended to subsidiaries, and the Company is making progress on developing a Group-wide
whistleblowing system. Furthermore, the Company established the Group Harassment Consulting Desk in March 2023 by capitalizing on theopportunity presented by the integration of offices of various Group companies in December 2022.
（Supplementary Principle 2.5.1 Establishing a Framework for Whistleblowing）
As part of its framework for whistleblowing, the Company has established an internal contact point and an external contact point (lawyer at an
external law office) as contact points for whistleblowing. In addition, the Company has set internal rules on whistleblowing. The Company has built
a system for protecting informants and for other related purposes by establishing different reporting lines for whistleblowing than those used in theworkplace. This reporting structure helps to ensure that those who provide reports or seek consultations will not be subject to disadvantageous
treatment on the grounds that they provided such reports or sought consultations.
【Principle 2.6 Roles of Corporate Pension Funds as Asset Owners】
The Company does not have a corporate pension fund plan.
【Principle 3.1 Full Disclosure】(i) The Company’s Corporate Philosophy, Standards of Business Conduct, Medium-Term Management Plan, and related information are posted on the
Company’s website.
(Corporate Philosophy: https://www.techmatrix.co.jp/en/company/policy.html)(Medium-Term Management Plan: https://www.techmatrix.co.jp/en/company/plan.html)(ii) The Company’s basic policy on corporate governance is presented in its Corporate Governance Report and is posted on its corporate website andthe Tokyo Stock Exchange’s website. In addition, the Company prepares these materials to disclose its basic policy on corporate governance and posts
them on its corporate website.
(Addressing the Corporate Governance Code: https://www.techmatrix.co.jp/ir/esg/esg_07.html)

(Information on companies listed on the Tokyo Stock Exchange: https://www.jpx.co.jp/listing/co-search/index.html)(iii) (iv) The Company has established the Personnel Committee. This committee deliberates matters concerning the selection and dismissal of Directors
and the policy on determining remuneration of Directors and related issues, and reports to the Board of Directors. It is made up of three or more
Directors selected by resolution of the Board of Directors, with Outside Directors selected to serve as a majority of the committee. Candidates for
Director are personnel who are well versed in the Company’s business and possess strategic thinking skills, the ability to discern technological advances,and knowledge of compliance and internal control. The candidates also have abundant knowledge of the markets where the Company conducts business,experience and knowledge of corporate finance and corporate management, and are well versed in corporate legal affairs and have a high degree of
specialization, among other qualities. Candidates for the selection and dismissal of Directors are determined by the Board of Directors based on the
proposals formulated by the Personnel Committee and their decisions are reflected in proposals put forward to the general meetings of shareholders.
The Company’s basic policy is to adopt a remuneration structure linked to shareholder interests so that the remuneration of each Director provides
adequate incentive for them to achieve sustained increases in corporate value. The basic policy also calls for setting the remuneration of each individual
Director at an appropriate level based on each Director’s individual job responsibilities when determining such remuneration. Specifically, theremuneration of Executive Directors comprises base remuneration as fixed remuneration, as well as performance-linked monetary remuneration, postdelivery type performance-linked share remuneration and stock compensation-type stock option remuneration as performance-linked remuneration.
Outside Directors, who assume a supervisory role, are paid only base remuneration in light of their duties. The determination of specific amounts ofindividual remuneration is entrusted to the President and CEO based on a resolution by the Board of Directors. The scope of authority of the President
and CEO covers the amount of base remuneration of each Director and the number of stock options allotted to each individual Director. The
performance-linked remuneration of each individual Director is paid in accordance with a standard amount and target achievement rate established inadvance by the Board of Directors. To ensure that this authority is properly exercised by the President and CEO, the Board of Directors submits theoriginal proposal for review to the Personnel Committee, and the committee reports back to the Board of Directors. The President and CEO, who is
entrusted with this authority as described above, is required to make the determination in accordance with the content of the report. The content of thisdetermination is fully entrusted to the President and CEO because the Company has judged that he is the most knowledgeable about matters such as
the Group’s environment and its management condition and is capable of comprehensively determining the remuneration of officers. This
determination will be made based on the original proposal, which is submitted for review to the Personnel Committee and reported back to the Boardof Directors. Based on this process, the Company has judged that the Representative Director’s authority will be exercised appropriately without any
arbitrary decisions being made. For details, please see “Details of Disclosure on Policy for Determining the Amount or Calculation Method of
Remuneration” later in this report.
(v) The reasons for appointing all candidates for Director, including candidates for Outside Director, are presented in the convocation notice for thegeneral meeting of shareholders.
（Supplementary Principle 3.1.2 Providing English Language Disclosures）
The Company translates certain parts of its website (corporate profile, business overview, IR-related information) into English. Furthermore, theCompany strives to promptly announce and publish its earnings reports and supplementary earnings briefing materials in English as soon as possible
after the Japanese documents are disclosed. Regarding the convocation notice for the general meeting of shareholders, since the Ordinary General
Meeting of Shareholders held in June 2021, the Company has translated into English the parts that correspond to the so-called narrowly definedconvocation notice and parts of the reference documents for the general meeting of shareholders and has disclosed those documents on its website andthe Tokyo Stock Exchange’s website. Since 2023, the corporate governance report has also been translated and disclosed in English. The Company
will continue working to provide information in English, taking into consideration the level of the foreign investor ratio.
（Supplementary Principle 3.1.3 Initiatives on Sustainability, Investments in Human Capital and Intellectual Properties）
The Company recognizes that its response to sustainability issues, including climate change, is an important management issue, and it has establisheda system that enables the Board of Directors to exercise more appropriate supervision. The Sustainability Committee, which reports to the Executive
Committee, the body responsible for overall business execution, manages progress on the response to climate change. The Sustainability Committee
works closely with the Corporate Planning Dept., which is in charge of environmental management, to supervise the climate change response measuresand related planning at each division, headquarters, department, branch and sales office. The Sustainability Committee comprises appointed membersof departments within the Corporate Headquarters. The Executive Committee discusses the current status of progress on these activities or important
issues. Following these discussions, these issues are reported to and discussed by the Board of Directors at least once a year, and they are reflected inand aligned more closely with the Company’s management strategy.
The Company discloses information about climate change-related impacts on the Company using the TCFD framework. Specific disclosures include
the amount of greenhouse gas emissions generated by the Company’s business activities, identification of climate change-related risks andopportunities that will affect the Company’s business activities, and future environmental targets.
Additionally, the Company formulated and disclosed the Medium-Term Management Plan “BEYOND THE NEW NORMAL” on May 10, 2021.
The Company views the rapid shift to digitalization and the drastic changes in the industrial structure as new growth opportunities. It will acceleratebusinesses toward areas absolutely necessary for society and provide services to solve social issues, with the aim of contributing to the creation of asustainable society.
Specifically, the Company will contribute to customers’ efforts to promote digital transformation (DX) and achieve the SDGs through its businessactivities. Guided by its seven key strategies, the Company will endeavor to increase its corporate value by striving to expand business and enhance
its systems.
The Company has adopted “The IT professional group who creates a better future” as its Mission Statement. It understands that ongoing investment
in human capital is more important than anything else in achieving continuous growth in the future. Accordingly, the Company is actively investing inand developing an environment conducive to human resource development. As a specific measure, the Company is building a training system andcurriculum to allow personnel to acquire the proper and necessary abilities according to their position, duties and occupation. Notably, engineers needto learn the latest cutting-edge technologies. Therefore, the Company is focusing on nurturing advanced IT personnel through such means as making
use of external professional organizations. Moreover, the Company has set up a rewards system that, for example, provides incentives to those who
acquire specialized qualifications. Through these measures, the Company fosters a corporate culture that will accelerate the realization of the ThreeStandards of Business Conduct and SIMPLE & 4C (the Company’s ideal professional human resources), which are based on the Mission Statement,
and conduct related human resources development.
Regarding investment in intellectual property, the Company has adopted a business model based on providing outstanding products and services bydeveloping unique applications and services. Therefore, it actively invests in technology research to solve customers’ issues. The Company strives tomaintain the value of its technologies through such means as acquiring patents for specific intellectual property developed in the course of its businessactivities.
In addition, the Company discloses information about climate change-related impacts on the Company using the TCFD framework. Specific disclosures
include the amount of greenhouse gas emissions generated by the Company’s business activities, identification of climate change-related risks andopportunities that will affect the Company’s business activities, and future environmental targets.
(The Company’s Corporate Philosophy: https://www.techmatrix.co.jp/en/company/policy.html )(Medium-Term Management Plan “BEYOND THE NEW NORMAL”: https://www.techmatrix.co.jp/en/company/plan.html)(ESG Information: https://www.techmatrix.co.jp/en/ir/esg/index.html)(Initiatives for employees (human resources development): https://www.techmatrix.co.jp/ir/esg/esg_04.html) (Only in Japanese)(Information disclosure based on the TCFD recommendations: https://www.techmatrix.co.jp/ir/esg/esg_01.html) (Only in Japanese)（Supplementary Principle 4.1.1 Scope and Content of the Matters Delegated to the Management）
The Company has set forth in its Rules of the Board of Directors the matters that are to be deliberated and resolved in meetings of the Board of
Directors. In addition, in accordance with its transition to a Company with an Audit & Supervisory Committee, the Company has revised its Articles
of Incorporation to conduct rapid management decision-making. Under these revisions, the Board of Directors can entrust all or some decisions on
business execution to the Full-time Directors within the scope permitted by laws and regulations.
The Executive Committee comprises Full-time Directors (including Directors who are Full-time Audit & Supervisory Committee Members), Executive
Officers, business department managers and certain other personnel. Pursuant to requests for advice from the President and CEO, the Executive
Committee provides its advice to the Board of Directors and the President and CEO on 1) important corporate management issues; 2) agenda items
for Board of Directors meetings; and 3) the establishment, amendment and abolition of various important rules, in accordance with the Rules of the
Executive Committee. The President and CEO serves as the chair of the Company’s Executive Committee.
The Company’s Board of Directors and Executive Officers believe that the Medium-Term Management Plan “BEYOND THE NEW NORMAL,”
which was formulated in May 2021, constitutes a commitment to shareholders and other stakeholders. Therefore, the management strategies laid out
in the plan are steadily being implemented. In addition, the Board of Directors and Executive Officers believe that progress on those strategies should
be explained to shareholders and other stakeholders. Based on this belief, the status of progress on strategies is explained at earnings briefings, generalshareholder meetings, and other events.
【Principle 4.9 Independence Standards and Qualifications for Independent Outside Directors】
The Company’s independence criteria for Independent Outside Directors are formulated with reference to the independence requirements establishedby the Tokyo Stock Exchange.
When selecting candidates for Independent Outside Directors, the Company selects individuals who have abundant experience and extensive
knowledge of corporate management, corporate legal affairs and other subjects, and who can be expected to offer opinions and advice that will help
to increase the Company’s corporate value over the medium and long terms.
（Supplementary Principle 4.10.1 Appropriate Involvement and Advice from Independent Outside Directors by Establishing an Independent
Nomination Committee and Remuneration Committee）
The Company has established the Personnel Committee to deliberate on matters concerning the decision-making policy for the selection and dismissalof Directors, and Directors’ remuneration, among other matters, and report to the Board of Directors. The Personnel Committee comprises three ormore Directors selected by resolution of the Board of Directors, with Outside Directors selected to form a majority of the members. While considering
opinions from Outside Directors based on their independent perspectives, the Personnel Committee conducts discussions on the ideal remuneration
structure and the next generation of candidates for Director. The committee also carries out highly fair and transparent evaluations of Directors andconsiders the composition of the next generation of Directors.
（Supplementary Principle 4.11.1 Views on the Composition of the Board of Directors and Related Matters）
The Company has established that there shall be no more than nine Directors (excluding Directors who are Audit & Supervisory Committee Members)
and no more than four Directors who are Audit & Supervisory Committee Members.
The Company believes that its top priority is to increase medium- to long-term corporate value by achieving sustainable growth of its businesses andimproving business stability. The Company selects Directors from among candidates who are personnel that are well versed in the Company’s businessand possess strategic thinking skills, have the ability to discern technological advances, and possess knowledge of compliance and internal control.
The candidates also have abundant knowledge of the markets where the Company conducts business; experience and knowledge of corporate financeand corporate management, and are well versed in corporate legal affairs and have a high degree of specialization, among other qualities.
Moreover, from the perspective of promoting diversity and women’s success in the workplace, the Company has selected two female Directors toensure that management can take the lead in actively discussing such issues.
The Company has posted a skills matrix of its Officers on its corporate website.
(Information about governance: https://www.techmatrix.co.jp/ir/esg/esg_06.html)（Supplementary Principle 4.11.2 Concurrent Positions of Directors and Audit & Supervisory Committee Members）
The Full-time Directors hold concurrent positions at the Company’s Group companies and companies in which the Company has invested. The
Company believes that these are important duties necessary to conduct business operations efficiently while ensuring compliance. Furthermore, four
Outside Directors concurrently serve as officers of other publicly listed companies. The Company has determined that these concurrent positions arereasonable in scope, and that these Directors are adequately fulfilling their roles and responsibilities as Directors of the Company.
The Company presents the concurrent positions held by its Directors in the convocation notice for the general meeting of shareholders and posts thisinformation on its corporate website.
(Information on concurrent positions is presented in the convocation notice for the general meeting of shareholders:
https://www.techmatrix.co.jp/en/ir/event/event_03.html)(Supplementary Principle 4.11.3 Summary of Results of Analysis and Evaluation of the Effectiveness of the Board of Directors as a Whole)
To ensure the effectiveness of the Board of Directors and improve how it functions, the Company conducts a questionnaire survey on the performanceof Directors’ duties, the effectiveness of the Board of Directors as a whole, the composition of the Board of Directors, and the status of the Board of
Directors’ operation, covering the Directors (including Audit & Supervisory Committee Members). Based on the results of an analysis of thequestionnaire survey, the Company conducts an evaluation of the effectiveness of the Board of Directors as a whole.
This year, the Company conducted the questionnaire survey in April 2023, and conducted the evaluation in May 2023.
The evaluation results of this year’s survey are as follows:(1) The Company’s Board of Directors has largely achieved diversity and has secured effective and appropriate management supervisory functions.
(2) The Board of Directors conducts active and constructive discussions, making the most of the knowledge, experience, and other qualities of eachmember.
Based on the aforementioned results, the Company has determined that the Board of Directors’ duties and roles are being performed effectively.
Going forward, the Company will continue to conduct an analysis and evaluation once a year.
The evaluation is presented in the Company’s Corporate Governance Report and is posted on its corporate website and the Tokyo Stock Exchange’s
website.

(Addressing the Corporate Governance Code: https://www.techmatrix.co.jp/ir/esg/esg_07.html)(Information on companies listed on the Tokyo Stock Exchange: https://www.jpx.co.jp/listing/co-search/index.html)（Supplementary Principle 4.14.2 Training policy for Directors and Audit & Supervisory Board Member）
The Company provides Full-time Directors and Executive Officers with training as appropriate for their duties in charge of acquiring new
knowledge. Additionally, the company encourages them to participate in outside seminars, participated in industry groups, and actively participatedin training sessions and exchange sessions held by various organizations at our expense to create an environment in which they can acquire newknowledge and develop their own self-development. Furthermore, the Outside Director (lawyer specializing in corporate law) explain the latest
trends in the Corporate Law and the Corporate Governance Code. At the same time, we have established a forum for dialogue with institutional
investors to create opportunities to grasp evaluations, issues, and expectations of the Company. In addition, the Board of Directors conducts monthly【Principle 5.1 Policy for Constructive Dialogue with Shareholders】
Every six months, the Company conducts an earnings briefing. The President and CEO conducts a presentation at these briefings. In addition, theCompany is working to increase the number of briefings for individual investors and improve the frequency of small meetings.
The President and CEO conducts a dialogue with shareholders and other investors within a reasonable scope, and the opinions and concerns obtained
through this dialogue are reported to the Board of Directors as needed. When IR staff members conduct these activities, reporting to the Board of
Directors is undertaken by having the staff members report their findings to the General Manager of the Corporate Planning Dept., who then reports
the findings to the Board of Directors.
When conducting dialogue with shareholders and other investors through not only earnings briefings and briefings for individual investors, but also
other opportunities for dialogue, the Company strives to manage insider information by using information disclosed in earnings reports, securities
reports, medium-term management plans and other materials as dialogue topics.
（Supplementary Principle 5.1.1 Shareholder Meetings with Senior Management, Outside Directors or Audit and Supervisory Board Members）
The President and CEO of the Company basically handles earnings briefings, individual investor briefings, small meetings, individual interviews,
and dialogues with shareholders and investors. In addition, IR staff members, the General Manager of the Corporate Planning Dept. and the Fulltime Audit & Supervisory Committee Member respond to requests for interviews.

2. Capital Structure
Foreign shareholding ratio

From 20% or more to less than 30%【Major Shareholders】
Name or Designation
Custody Bank of Japan, Ltd. (account in trust)

Number of Shares Held Shareholding(Shares)
Ratio (%)
6,599,700

16.53

The Master Trust Bank of Japan, Ltd. (account in trust)

6,195,800

15.52

STATE STREET BANK AND TRUST COMPANY 505025

3,286,500

8.23

Kyosuke Tokuyama

1,426,000

3.57

GOVERNMENT OF NORWAY

1,359,500

3.40

NORTHERN TRUST CO. (AVFC) RE 009-016 064-324 CLT

1,077,300

2.69

TECHMATRIX’s Employee Shareholding Association

813,000

2.03

KIA FUND 136

589,800

1.47

THE BNK OF NEW YORK MELLON 140042

581,800

1.45

THE BNK OF NEW YORK, TREATY JASDEC ACCOUNT

510,800

1.28

Existence of Controlling Shareholder(s)(Excluding Parent Company)―――

Existence of Parent Company

None

Supplementary Information
1. The Company holds 4,605,598 shares of treasury stock as of March 31, 2022, but these treasury shares are excluded from the above list of major
shareholders. In addition, the shareholding ratios are calculated excluding treasury shares.
2. Reports of Large Volume Holdings with respect to the Company’s Shares (Change Report) have been submitted as follows. The information ispresented in accordance with the shareholder registry as of March 31, 2022.
・Nomura Asset Management Co., Ltd.: 564,700 shares (December 5, 2014)
・Total of two entities comprising Daiwa Securities Co. Ltd. and its joint holder: 695,500 shares (May 10, 2019)
・Mitsubishi UFJ Financial Group, Inc. (total of four joint holders): 2,232,700 shares (June 21, 2021)
・Artisan Investments GP LLC: 1,922,600 shares (August 18, 2021)
・Sumitomo Mitsui DS Asset Management Company, Limited: 1,757,800 shares (February 22, 2022)
・Goodhart Partners LLP: 4,690,500 shares (June 23, 2022)
・Total of two entities comprising Sumitomo Mitsui Trust Asset Management Co., Ltd. and its joint holder: 3,234,500 shares (Septemberr 22, 2022)
・Total of two entities comprising Asset Management One Co., Ltd. and its joint holder: 1,683,100 shares (March 17, 2023)
・BNY Mellon Investment Management Japan Limited and its joint holder: 3,708,500 shares (November 11, 2021)

3. Corporate Attributes
Stock Exchange Listings and Market
Classification

Tokyo Prime Market

Fiscal Year-End

March

Industry

Information & Communication

Number of Employees as of Previous
Fiscal Year-End (Consolidated)

1,000 or more

Revenue (consolidated) in the Previous
Fiscal Year

From \10 billion or more to less than \100 billion

Number of consolidated subsidiaries as ofthe previous fiscal year-end

Less than 10

4. Policy on Measures to Protect Minority Shareholders When Conducting Transactions with Controlling Shareholder―――
5. Other Special Circumstances that May Have a Material Impact on Corporate Governance―――

Ⅱ Overview of Business Management Organization and Other Corporate Governance Systems Related to Managerial DecisionMaking, Business Execution and Management Supervision

1. Items Related to Organizational Structure and Operations, etc.
Form of Organization

Company with an Audit & Supervisory Committee【Directors】
Number of Directors Stipulated in Articles
of Incorporation

13

Term of Office for Directors Stipulated in
Articles of Incorporation

1 yearChairman of the Board of Directors

President

Number of Directors

11

Appointment of Outside Directors

Appointed

Number of Outside Directors

7

Number of Outside Directors Designatedas Independent Director

7

Relationship with the Company (1)Name

Relationship with the Company*

Attributes
a

b

c

d

e

f

G

h

Hiroaki Yasutake

From another company

Michi Kaifu

From another company

Ari Horie

From another company△

Hideyuki Sasaki

From another company△

Ken Takayama

From another company△

Ryota Miura

Lawyer〇Akio Sugihara

From another company○* Categories for Relationship with the Company

△

i

j

k

* Mark “○” when the individual presently falls or has recently fallen under the category, and “△” when the individual fell under the category in
the past* Mark “●” when a close relative of the individual presently falls or has recently fallen under the category and “▲” when a close relative of theindividual fell under the category in the pasta. Executive of the Company or its subsidiaryb. Non-executive Director or executive of a parent company of the Company
c. Executive of a fellow subsidiary of the Company
d. Party whose major client or supplier is the Company or an executive thereof
e. Major client or supplier of the Company or an executive thereof
f. Consultant, accounting or legal professional who receives a large amount of monetary compensation or other property (other than remuneration
as an Officer)
g. Major shareholder of the Company (if the major shareholder is a corporation, an executive of the corporation)h Executive of a client or supplier of the Company (other than those which fall under any of d, e, or f) (applies to self only)
i Executive of a company that has cross-appointments of Outside Officers with the Company (applies to self only)
j Executive of an entity that receives a donation from the Company (applies to self only)
k Others
Relationship with the Company (2)Name

Hiroaki Yasutake

Michi Kaifu

Ari Horie

Audit &
Independent
Supervisory
Officer
Committee
Member○○○

Supplementary Information
Related to the Criteria

Reasons for Appointment

Mr. Hiroaki Yasutake retired as
Director of Rakuten, Inc. (currently
Rakuten Group, Inc.) in January
2016.

The Company has judged that Mr.
Yasutake’s knowledge and experience in
the Internet business and systemdevelopment field can be put to good use in
the Company’s management. Therefore, theCompany put forward a proposal on Mr.
Yasutake’s appointment to the Ordinary
General Meeting of Shareholders in June
2023, and it was approved.
In addition, Mr. Yasutake meets theindependence
requirements
forIndependent Officers set forth by the Tokyo
Stock
Exchange. Accordingly,
theCompany has appointed him as an
Independent Officer based on its belief that
he does not pose a risk of creating conflictsof interest with ordinary shareholders.

―――

Ms. Michi Kaifu has a wealth of experienceand outstanding knowledge in the Internet
business and emerging technologies field.
The Company expects her to provide
effective advice on the Company’s
management from the perspective ofmanagement strategy as an entrepreneur
and consultant and from a standpoint
independent of the management team.
Therefore, the Company put forward a
proposal on Ms. Kaifu’s appointment to theOrdinary General Meeting of Shareholders
in June 2023, and it was approved.
In addition, Ms. Kaifu meets theindependence
requirements
forIndependent Officers set forth by the Tokyo
Stock
Exchange. Accordingly,
theCompany has appointed her as an
Independent Officer based on its belief thatshe does not pose a risk of creating conflictsof interest with ordinary shareholders.

―――

Ms. Ari Horie offers a training program for
women entrepreneurs in Silicon Valley,
U.S. and has a wealth of experience andoutstanding knowledge in fostering nextgeneration
leaders
basedonentrepreneurship. The Company expects
her to provide effective advice on the
Company’s managementfromtheperspective of women’s advancement in theworkplace and from a standpoint
independent of the management team.
Therefore, the Company put forward a
proposal on Ms. Horie’s appointment to theOrdinary General Meeting of Shareholders
in June 2023, and it was approved.
In addition, Ms. Horie meets theindependence
requirements
forIndependent Officers set forth by the Tokyo
Stock
Exchange. Accordingly,
theCompany has appointed her as an
Independent Officer based on its belief thatshe does not pose a risk of creating conflictsof interest with ordinary shareholders.

Hideyuki Sasaki

Ken Takayama

Ryota Miura

○

○

○

Mr. Hideyuki Sasaki has knowledge andexperience in corporate management,internal control and international operations
as well as considerable insight into financeand accounting. The Company has judgedthat Mr. Sasaki’s knowledge and experiencein those fields can be put to good use in the
Company’s management. Therefore, theCompany put forward a proposal on Mr.
Sasaki’s appointment to the Ordinary
General Meeting of Shareholders in June
2023, and it was approved. In addition, Mr.
Sasakimeets
theindependence
requirements for Independent Officers set
forth by the Tokyo Stock Exchange.
Accordingly, the Company has appointed
him as an Independent Officer based on its
belief that he does not pose a risk ofcreating conflicts of interest with ordinary
shareholders.

○

―――

○

Mr. Takayama has a wealth of knowledge
and experience in corporate management aswell as considerable insight into financeand accounting. The Company has judgedthat he can monitor overall management
and provide effective advice to strengthen
corporate governance. Therefore, theCompany put forward a proposal on Mr.
Mr. Ken Takayama retired as Director Sasaki’s appointment to the Ordinary
General Meeting of Shareholders in Juneand Managing Executive Officer of2023, and it was approved.
Rakuten, Inc. (currently Rakuten
In addition, Mr. Takayama meets theGroup, Inc.) in March 2013.
independence
requirements
forIndependent Officers set forth by the Tokyo
Stock
Exchange. Accordingly,
theCompany has appointed him as an
Independent Officer based on its belief that
he does not pose a risk of creating conflictsof interest with ordinary shareholders.

○

The Company expects Mr. Miura to provide
effective advice from his professional
perspective as a lawyer, especially incorporate legal affairs. The Company has
judged that Mr. Miura can provide effective
advice based on his independent standpointwith no relations with the Company, withthe aim of strengthening monitoring
functions and corporate governance.
Mr. Ryota Miura is registered as a Therefore, the Company put forward a
proposal on Mr. Miura’s appointment to thelawyer and is a Partner of Miura & Ordinary General Meeting of Shareholders
Partners.
in June 2023, and it was approved.
In addition, Mr. Miura meets theindependence
requirements
forIndependent Officers set forth by the Tokyo
Stock
Exchange. Accordingly,
theCompany has appointed him as an
Independent Officer based on its belief that
he does not pose a risk of creating conflictsof interest with ordinary shareholders.

Akio Sugihara○

Mr. Akio Sugihara was an Executiveof Rakuten, Inc. (currently Rakuten
Group, Inc.) until June 18, 2019.

○

Mr. Sugihara has a wealth of experience andoutstanding knowledge in Internet businessand system development field. The
Company has judged that Mr. Sugihara canprovide monitoring of overall management
and effective advice to strengthen corporate
governance. Therefore, the Company put
forward a proposal on Mr. Sugihara’s
appointment to the Ordinary General
Meeting of Shareholders in June 2023, andit was approved. In addition, Mr. Sugihara
meets the independence requirements for
Independent Officers set forth by the Tokyo
Stock
Exchange. Accordingly,
theCompany has appointed him as an
Independent Officer based on its belief that
he does not pose a risk of creating conflictsof interest with ordinary shareholders.

【Audit & Supervisory Committee】
Committee Structure and Attributes of Chair
Full-timeMembers(people)All Members(people)Audit & Supervisory
Committee
Existence of Directors and Employees
Responsible for Assisting the Duties of the
Audit & Supervisory Committee

41Internal Directors(people)Outside Directors(people)0

4Committee Chair(Chair)Outside Director

Yes

Matters Concerning the Independence of Such Directors and Employees from the Executive Directors
The matters concerning the independence of such Directors and employees of the Company from the Executive Directors are as follows.
“Matters Concerning Directors and Employees Responsible for Assisting the Duties of the Company’s Audit & Supervisory Committee”
If the Audit & Supervisory Committee requests the assignment of assistants, the staff members of the Internal Audit Office shall be entrusted to assist
the duties of the Audit & Supervisory Committee.
“Matters Concerning the Independence of Directors and Employees Responsible for Assisting the Duties of the Company’s Audit & Supervisory
Committee from other Directors of the Company (excluding Audit & Supervisory Committee Members) and Matters Concerning Ensuring theEffectiveness of Instructions to Such Directors and Employees by the Company’s Audit & Supervisory Committee”
Any personnel transfers of and disciplinary measures against the assistants described above will require the approval of the Audit & Supervisory
Committee. Moreover, personnel evaluations will be undertaken based on a hearing of the opinions of the Audit & Supervisory Committee. During
the period designated for assistance by the Audit & Supervisory Committee, the Audit & Supervisory Committee will have the authority to direct theassistance duties of the designated employees, and the employees will not be subject to the directions and orders of the Directors.

Coordination Among the Audit & Supervisory Committee, Accounting Auditor, and Internal Audit Division
The Company has adopted the system described below to ensure that the audits of the Audit & Supervisory Committee are performed effectively.
i
The Company will strive to strengthen coordination among the three types of audits performed by the Audit & Supervisory Committee, Internal
Audit Office, and the audit firm. Moreover, the Audit & Supervisory Committee will regularly exchange opinions with the President and CEO, andthe audit firm. Concurrently, the Audit & Supervisory Committee receives direct briefings, as needed, by the Internal Audit Division on information
and auditing matters concerning internal control.
ii
To enhance the effectiveness of audits of the Group as a whole, the Company has established the Liaison Meeting for Group Corporate Auditors,
which meets regularly. Through the Liaison Meeting, the Company’s Audit & Supervisory Committee and the Corporate Auditors of subsidiaries
exchange information and opinions and work to enhance audit operations as a corporate group, contribute to risk management, and support managementfrom a defensive perspective. The Liaison Meeting for Group Corporate Auditors, etc. holds regular meetings once every quarter and convenes
extraordinary meetings as necessary.
iii
The Company budgets for the expenses necessary for the performance of the Audit & Supervisory Committee Members’ duties (limited to
expenses related to the performance of the duties of the Audit & Supervisory Committee) at the beginning of the fiscal year. If expenses necessary to
the performance of duties other than the budgeted expenses arise, the Company will pay those expenses in advance on a case-by-case basis or the
Audit & Supervisory Committee Members may claim reimbursement for those expenses after they are incurred.

【Voluntary Committees】
Existence of Voluntary Committee(s)Equivalent to a Nomination Committee orRemuneration Committee

YesStatus of Establishment of Voluntary Committee(s), Member Composition and Attributes of Committee Chair (Chair)
Name of Committee

All
Members(people)Full-timeMembers(people)Internal
Directors(people)OutsideDirectors(people)OutsideExperts(people)Committee
Chair(Chair)Other(people)Voluntary
Committee
Equivalent to a
Nomination
Committee

Personnel Committee

3

1

1

2

0

0

Internal
Director

Voluntary
Committee
Equivalent to a
Remuneration
Committee

Personnel Committee

3

1

1

2

0

0

Internal
Director

Supplementary Information
The Company has established the Personnel Committee to deliberate on matters concerning the decision-making policy for the selection anddismissal of Directors, and Directors’ remuneration, among other matters, and report to the Board of Directors.
The Personnel Committee comprises three or more Directors selected by resolution of the Board of Directors, with Outside Directors selected toform a majority of the members. In addition, the Committee Chair is elected by a mutual vote of the Committee Members. Candidates for Director
are decided by the Board of Directors in response to reports received from the Personnel Committee, and their decisions are reflected in proposals
put forward to the general meetings of shareholders. As for the individual remuneration of each Director, in response to reports received from the
Personnel Committee, the Board of Directors deliberates such remuneration, considering factors such as the remuneration level of employees, thescope of responsibilities required of Directors, and business results. The decision on the particular amount for each individual is then entrusted to
the Representative Director based on the details and within the monetary limit approved by the general meeting of shareholders.

【Independent Officers (Directors and Audit & Supervisory Committee Members)】
Number of Independent Officers (Directors
and Audit & Supervisory Committee
Members)

7

Other Matters Concerning Independent Officers (Directors and Audit & Supervisory Committee Members)
The Company registers all Outside Officers who fulfill the qualifications of Independent Officer as Independent Officers.

【Incentives】
Implementation Status of Measures Related
to Incentives Granted to Directors

Introduction of stock option plan and performance-linked remuneration plan, among others

Supplementary Information for Applicable Items
As performance-linked remuneration for Full-time Directors (excluding Directors who are Audit & Supervisory Committee Members), the Company
has introduced performance-linked monetary remuneration, post-delivery type performance-linked share remuneration and a stock compensation-type
stock option plan.
In addition, the Company has introduced a program where Directors can purchase the Company’s shares through the Officers’ Stock Ownership
Association.

Grantees of Stock Options

Internal Directors, employees

Supplementary Information for Applicable Items
The Company has introduced a stock compensation-type stock option plan for Full-time Directors (excluding Directors who are Audit & Supervisory
Committee Members) and Executive Officers (excluding those who hold concurrent positions as Directors).
In addition, the Company has introduced a program where such persons can purchase the Company’s shares through the Officers’ Stock Ownership
Association and the Employees’ Stock Ownership Association.

【Directors’ Remuneration】
Status of Disclosure of Individual Directors’
Remuneration

Individual remuneration is not disclosed.

Supplementary Information for Applicable Items
The total amount of remuneration paid to the Directors is presented in the Annual Securities Report.
Adoption of Policy on Determining
Remuneration Amounts and the Calculation
Adopted
Methods Thereof

Disclosure of Policy on Determining Remuneration Amounts and the Calculation Methods Thereof(1) Overview of Remuneration System for Officers (Directors and Audit & Supervisory Committee Members)

The Company’s basic policy is to adopt a remuneration structure linked to shareholder interests so that the remuneration of each Director provides
adequate incentive for them to achieve sustained increases in corporate value. The basic policy also calls for setting the remuneration of each individual
Director at an appropriate level based on each Director’s individual job responsibilities when determining such remuneration. Specifically, theremuneration of Executive Directors comprises base remuneration as fixed remuneration, as well as performance-linked monetary remuneration, postdelivery type performance-linked share remuneration and stock compensation-type stock option remuneration as performance-linked remuneration.
Outside Directors, who assume a supervisory role, are paid only base remuneration in light of their duties.
・Base remuneration
Base remuneration is provided as monthly fixed remuneration. It is determined by taking into account a comprehensive range of factors in accordancewith position, job responsibilities, and years of service, while considering other companies’ remuneration levels, the Company’s business results, thelevel of employee wages, and remuneration from subsidiaries and other entities where important positions are concurrently held.
・Performance-linked remuneration
The policy for determining the details of performance-linked remuneration for the Company’s Executive Directors, as well as the methodologies forcalculating the amounts or quantities of such remuneration, are outlined below.
<Performance-linked Monetary Remuneration>
With performance-linked monetary remuneration, the Company defines the responsibility of eligible Directors for performance targets by paying
monetary remuneration based on the achievement of those targets, in order to promote the sharing of even more value with shareholders. Specifically,
under this remuneration plan, the Company’s Board of Directors establishes numerical targets in advance for a certain period it defines, andremuneration varies with the achievement rate against those numerical targets, among other criteria. The amount of this monetary remuneration is
calculated by multiplying (1) a base remuneration amount determined by the Board of Directors for each Executive Director position by (2) an
achievement rate against a numerical performance target determined by the Board of Directors and (3) a period-of-service ratio. The Board of Directors
will determine the specifics of the remuneration, including details and the time period during which remuneration is provided.
<Post-delivery Type Performance-Linked Share Remuneration>
With post-delivery type performance-linked share remuneration, the Company grants stock remuneration as an incentive for eligible Directors to
improve the Company’s corporate value by defining their responsibility for performance targets and paying monetary remuneration based on theachievement of those targets. The purpose of this remuneration is for the eligible Directors to share the benefits and the risks of movements in the
Company’s stock price with shareholders. Specifically, under this remuneration plan, the Company’s Board of Directors establishes numerical targets
in advance for a certain period it defines, and remuneration varies with the achievement rate against those numerical targets, among other criteria. The
number of shares to be granted is calculated by multiplying (1) a base number of shares to be granted as determined by the Board of Directors for each
Executive Director position by (2) an achievement rate against a numerical performance target determined by the Board of Directors, and (3) a periodof-service ratio. The Board of Directors will determine the specifics of the remuneration, including details and the time period during which
remuneration is provided.
・Stock Compensation
The Company has introduced stock compensation-type stock option remuneration to create a remuneration structure that is aligned with shareholderinterests to ensure that the structure functions adequately as incentive for efforts to achieve sustained improvement in corporate value and shares thebenefits and the risks of movements in the Company’s stock price with shareholders. Regarding the calculation method, the Company employs thefair value computed using the Black-Scholes model to determine the number of shares to be allotted for the standard amount of each Director’s nonmonetary remuneration. The Board of Directors will determine the specifics of the remuneration, including details and the time period during which
remuneration is provided. However, these specifics are determined based on reports from the Personnel Committee.
(2) Allocation Ratio by Type and Determination Procedure for Officers’ Remuneration and Related Items
The allocation ratio of Executive Directors’ remuneration by type is determined based on remuneration standards that reflect as benchmarks the
remuneration standards of companies with a comparable business size to the Company as well as companies affiliated with relevant industries andbusiness formats. The amount of performance-linked remuneration and stock options (remuneration for which the value of remuneration received islinked to performance, stock price and other factors) is estimated to be between 30% and 40% of total remuneration. However, this principle shall not
apply in circumstances where, for example, the Company’s base remuneration is not paid because an Officer receives remuneration for holding animportant concurrent position at a subsidiary or other such entity. The total amount of remuneration is determined based on reports received from the
Personnel Committee (made up of a majority of Outside Directors who are Independent Officers), which is a voluntary nomination and remunerationcommittee, with such remuneration set to correspond to each Director’s responsibilities.
In addition, the President and CEO is entrusted with the specific details of individual remuneration for Directors based on a resolution by the Board of
Directors. The scope of authority of the President and CEO covers the amount of base remuneration of each Director and the number of stock options
allotted to each individual Director. The performance-linked remuneration of each individual Director is paid in accordance with a standard amountand target achievement rate established in advance by the Board of Directors. To ensure that this authority is properly exercised by the President andCEO, the Board of Directors submits the original proposal for review to the Personnel Committee, and the committee reports back to the Board of
Directors. The President and CEO, who is entrusted with this authority as described above, is required to make the determination in accordance withthe content of the report.
(3) Resolutions of the General Meeting of Shareholders on Officers’ Remuneration and Related Items
The amount of monetary remuneration of the Company’s Directors excluding Directors who are Audit & Supervisory Committee Members wasapproved by the Ordinary General Meeting of Shareholders held on June 24, 2022 as a limit on the remuneration of Directors of no more than \160
million per year (including remuneration of Outside Directors of \35 million per year) (hereinafter, the “base remuneration limit”). When the resolution
was passed, there were seven Directors (including three Outside Directors).
In addition, the Company has obtained approval to set the remuneration limit for granting performance-linked monetary remuneration to Directors
excluding Directors who are Audit & Supervisory Committee Members and Outside Directors at no more than \60 million per year, with this limit
being separate from the base remuneration limit and the stock option remuneration described below. As a remuneration limit for granting post-delivery
type performance-linked share remuneration, the Company has obtained approval to set the number of shares to be granted at no more than 60,000
shares per year and the amount of monetary remuneration receivable to be paid at no more than \60 million per year. When each resolution was passed,
there were four eligible Directors.
Furthermore, the share acquisition rights that can be allotted as stock option remuneration to Directors excluding Directors who are Audit &Supervisory Committee Members and Outside Directors was approved by the Ordinary General Meeting of Shareholders held on June 24, 2016 at no
more than \20 million per year (the number to be granted shall be no more than 200 per year, and the underlying shares shall be no more than 20,000
shares per year of the Company’s common stock), separately from the base remuneration limit. When the resolution was passed, there were four
eligible Directors.

The remuneration of Directors who are Audit & Supervisory Committee Members of the Company was approved by the Ordinary General Meeting of
Shareholders held on June 24, 2022 as no more than ¥50 million per year. When the resolution was passed, there were four Audit & Supervisory
Committee Members.

【Support System for Outside Directors】
The Corporate Planning Dept. serves as the point of contact and communicates information to the Outside Directors about the Board of Directors. It
sends documents covering significant agenda issues for Board of Directors meetings to the Outside Directors prior to meetings. The Corporate Planning
Dept. also provides briefings and reports before and after meetings as necessary.

2. Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, and Remuneration Decisions, etc.
(Overview of Current Corporate Governance System)[Board of Directors] Outside Directors have been invited to join the Board of Directors in order to strengthen its supervisory functions. It consists of
11 members, including 7 Outside Directors. The Board of Directors holds regular meetings once a month and extraordinary meetings as necessary.
[Executive Committee] The Executive Committee has been established as a forum for discussing issues related to business execution. It comprises
Full-time Directors (including Directors who are Full-time Audit & Supervisory Committee Members), Executive Officers, business department
managers and certain other personnel. In addition, the Executive Committee evaluates key agenda issues that should be brought before the Board of
Directors and reports to the Board of Directors, and the President and CEO. The Executive Committee meets once a month on a regular basis andconvenes extraordinary meetings as necessary.
[Audit & Supervisory Committee] The Audit & Supervisory Committee comprises one Full-time Audit & Supervisory Committee Member and three
Part-time Audit & Supervisory Committee Members. (All four members are Outside Directors.) Regular Audit & Supervisory Committee meetings
are held once a month and extraordinary Audit & Supervisory Committee meetings are held as necessary.

[Group Management Meetings] The group management meetings have been established by the Company to share management-related information,
discuss related issues, and strengthen collaboration across the Company and its subsidiaries. The meetings comprise Group Executive Officers (Fulltime Directors, Executive Officers, Presidents of subsidiaries, Directors of major subsidiaries) and the Director who is a Full-time Audit & Supervisory
Committee Member. The group management meetings conduct regular quarterly meetings.
[Personnel Committee] The Personnel Committee has been established as an advisory body to the Board of Directors in order to enhance corporate
governance by bolstering the fairness, transparency and objectivity of processes related to nomination and remuneration, etc. for Directors. In
response to the Board of Directors’ consultations, the Personnel Committee discusses the following issues and reports back to the Board of Directors.
(1) Issues related to the selection and dismissal of Directors (matters for resolution by the general meeting of shareholders)(2) Issues related to the selection and removal of the Representative Director (matters for resolution by the Board of Directors)(3) Issues related to the selection and removal of Executive Directors (matters for resolution by the Board of Directors)(4) Issues related to the policy for determining the remuneration of Directors, etc.
(5) Issues related to the remuneration of Directors (excluding Audit & Supervisory Committee Members), etc.
(6) Issues related to the limit on remuneration for Directors (matters for resolution by the general meeting of shareholders)(7) Issues related to succession planning(8) Other important management issues deemed necessary by the Board of Directors
The Personnel Committee comprises three or more Directors selected by resolution of the Board of Directors, with Outside Directors selected to forma majority of the members. In addition, the Committee Chair is elected by a mutual vote of the Committee Members.
[Internal Audit] The Company’s internal audit system is as follows. The Internal Audit Office has been established as an organization under the directcontrol of the President. It systematically conducts internal control audits, Information Security Management System (ISMS) internal audits, andoperational audits. The Internal Audit Office has a full-time staff of three employees.
[Accounting Audit] With regard to accounting audits, the Company has appointed KPMG AZSA LLC as its Accounting Auditor in accordance with
the Companies Act and to perform accounting audits in accordance with the Financial Instruments and Exchange Act.
The operational structure at KPMG AZSA LLC is as follows:
・Composition of assistants involved in accounting audit operations
Four certified public accountants (CPAs) and nine other personnel

3. Reasons for Selecting the Current Corporate Governance System

The Company views increasing its corporate value as a top priority, and strives to maintain and enhance its competitiveness, as well as maximize theadded value it can provide to customers. To this end, the Company believes that the foundation of corporate governance is to establish a system for
implementing the following in a well-balanced manner: strategic and speedy management decision-making and rapid and appropriate businessexecution based on those decisions, as well as adequate supervision and auditing of management and business execution.
The Board of Directors is the highest body for management decision-making and supervision of business execution. Outside Directors are invited toparticipate on the Board of Directors in order to bolster its supervisory functions.
Moreover, the Company has established the Personnel Committee to deliberate on matters concerning the decision-making policy for the selection anddismissal of Directors, and Directors’ remuneration, among other matters, and report to the Board of Directors. Furthermore, the Company has adopted
an Executive Officer system to separate the Board of Director’s decision-making and business execution supervisory functions from the businessexecution functions of each business, as part of efforts to enhance management efficiency.
As its auditing function, the Company has established the Audit & Supervisory Committee. The Audit & Supervisory Committee comprises one Fulltime Audit & Supervisory Committee Member and three Part-time Audit & Supervisory Committee Members. (All four members are Outside
Directors.)

Ⅲ Status of Implementation of Measures Related to Shareholders and Other Stakeholders
1. Measures to Vitalize the General Meeting of Shareholders and Facilitate Exercise of Voting Rights
Supplementary Information
Prompt Delivery of Convocation Noticefor the General Meeting of Shareholders

The Company posted the convocation notice for the General Meeting of Shareholders on its
website on June 1 ahead of the mailing date of June 7 for the convocation notice.

Setting Date of General Meeting of
Shareholders to Avoid Being Held on theSame Day as Many Other Companies

The General Meeting of Shareholders was held at 2:00 p.m. on June 23, 2023

Exercise of Voting Rights by
Electromagnetic Means

The Company has provided an environment in which shareholders can exercise their voting
rights via the Internet and other electromagnetic means since the 32nd Annual General
Meeting of Shareholders.

Participation in Platform for Exercise of
Voting Rights by Electromagnetic Meansand Other Measures to Enhance theEnvironment for Exercise of Voting Rights
by Institutional Investors

The Company has participated in a platform for the exercise of voting rights by electronicmeans since the 32nd Annual General Meeting of Shareholders.

Providing Convocation Notice (Summary)in English

The Company has prepared an English version of a summary of the convocation notice andsubmitted and posted it to the Tokyo Stock Exchange’s website, along with posting it on its
corporate website.

2. Status of Investor Relations Activities

Supplementary Information

PreparingandDisclosure Policy

Announcing

Holding Regular Briefings
Individual Investorsfor

Explanation
byRepresentative

The Company has posted its IR Policy at the following URL:
https://www.techmatrix.co.jp/en/ir/management/management_06.html.
Briefings were held on August 28, 2022, February 22, 2023 and March 11,
2023.

Yes

Holding Regular Briefings forAnalysts and Institutional Investors

The briefing for the six months ended September 30, 2022 was held on
November 18, 2022, while the briefing for the fiscal year ended March 31,
2023 was held on May 16, 2023. Both briefings were held online with
explanations given directly by the Representative Director.
Additionally, the Company organized a forum for dialogue with its Outside
Directors on March 31, 2023, providing a briefing on its governance systemwith a question-and-answer session.

Yes

Posting Investor Relations Materials
on the Company’s Website

The Company posts earnings reports, business reports, annual securities
reports, and company presentation materials at the following URL:
https://www.techmatrix.co.jp/en/ir/library/index.html.

Establishing Investor Relations
Department (Staff)

The Corporate Planning Dept. is the department in charge of investor
relations. Mr. Motoki Yamazaki, the General Manager of the Corporate
Planning Dept., serves as the administrative contact point for investor
relations.

3. Status of Measures to Ensure Due Respect for Stakeholders
Supplementary Information

Provisions for Respecting the Position of
Stakeholders through Internal Rules, etc.

The Company has established the Corporate Ethics Guidelines, which set forth basic
principles that the Group’s Officers and employees should comply with. The Company
stipulates in these guidelines that Officers and employees must respect the position ofcustomers and provide accurate and timely disclosure to stakeholders such as shareholders,clients and suppliers, and the general public, in order to enhance the transparency ofcorporate management.

Implementation of Environmental
Protection, Corporate Social
Responsibility (CSR) and Other Activities

The Company has established an Environmental Policy and has built an environmental
management system based on this policy. It conducts environmental improvement activities
systematically and continuously.

Formulation of Policy Concerning
Disclosure of Information to Stakeholders
and Related Policies

The Company has established the Corporate Ethics Guidelines, which set forth basic
principles that the Group’s Officers and employees should comply with. The Company
stipulates in these guidelines that Officers and employees must respect the position ofcustomers and provide accurate and timely disclosure to stakeholders such as shareholders,clients and suppliers, and the general public, in order to enhance the transparency ofcorporate management.
The Company has posted its IR Policy at the following URL:
https://www.techmatrix.co.jp/en/ir/management/management_06.html.

Ⅳ Matters Concerning the Internal Control System
1. Basic Policy on Internal Control System and the Status of Its Development< Basic Policy on Internal Control System >The Company’s basic policy on the development of its internal control system is outlined below.
At a meeting of the Board of Directors held on June 21, 2019, the Company passed a resolution to partially revise this basic policy.
Particulars

1. System to Ensure that the Performance of Duties by the Company’s Directors and Employees and the Directors, etc. and Employees of the Company’s
Subsidiaries Comply with Laws, Regulations, and the Articles of Incorporation(1) The Company has established the Corporate Ethics Guidelines, Compliance Standards of Conduct, Basic Human Rights Policy, Environmental
Policy, Security Policy, and Social Media Policy. Based on these policies, the Company will clearly define the standards of conduct of Officers andemployees to ensure compliance with laws and regulations, the Articles of Incorporation, internal rules and so forth.
(2) The Company will strive to spread awareness of the aforementioned guidelines, standards of conduct, and other rules by providing regular educationand training to Officers and employees.
(3) The Company will conduct audits of the status of day-to-day business execution by Directors (excluding Audit & Supervisory Committee Members)
and each department, and confirm the status of compliance with guidelines, standards of conduct and other rules.
(4) Once a month, the Company will hold morning meetings attended by all employees to raise employees’ knowledge of the importance of participationin management. The President will explain management policies, the status of progress on businesses, and related matters, and endeavor to foster ashared Company-wide awareness of these issues.
(5) The Company will resolutely oppose anti-social forces that have a negative impact on social order and the sound operations of businesses and will
cut all relations with such entities.
(6) In accordance with the Group Company Management Rules, the Company has established the authority to conduct investigations of subsidiaries
and the right to require reports from them within the scope necessary for the Company’s audits by its Full-time Audit & Supervisory Committee
Members. In addition, the Company’s Internal Audit Office conducts regular and special audits of subsidiaries either directly or via the subsidiaries’internal audit offices.
(7) The Company will introduce a whistleblowing system that Officers and employees of the Company and its subsidiaries can use. It will strictly
deal with any compliance violations or other misconduct.
(Basic Human Rights Policy: https://www.techmatrix.co.jp/en/ir/esg/index.html)
2. System for the Storage and Preservation of Information Related to the Performance of the Duties of the Company’s Directors(1) In accordance with the Document Management Rules, the Company will appropriately store and manage (including disposal) the following
documents (including electromagnetic records) along with related materials. It will also verify the status of implementation and revise the rules asnecessary.
・Minutes of the General Meeting of Shareholders
・Minutes of Meetings of the Board of Directors
・Minutes of Meetings of the Executive Committee
・Copies of documents submitted to tax offices and other government and public organizations, and to stock exchanges
・Other documents stipulated by the Document Management Rules(2) The Company will endeavor to manage information assets in compliance with JIS Q 27001 (ISMS).
(3) The Company will achieve appropriate document storage and management (including disposal) by having subsidiaries introduce systems that areequivalent to those of the Company.
3. Rules Concerning the Management of the Risk of Loss at the Company and its Subsidiaries and Other Relevant Risk Management Systems(1) The Company has established Crisis Management Rules. Under these rules, the Company will establish a crisis management system and strive toprevent crises, including the risk of loss. Concurrently, if a crisis occurs or is detected, the Company will work to avoid and prevent the spread ofdamage through such means as establishing a Crisis Response Headquarters. Additionally, the Company will establish a business continuity plan inaccordance with the rules and share the plan with subsidiaries. By doing so, the Company and its subsidiaries will endeavor to minimize risk byformulating a business continuity plan, identifying risks associated with business continuity, and implementing measures to address those risks.
(2) The Company will obtain JIS Q 27001 (ISMS) certification. Through this certification’s maintenance and improvement activities, the Company
will strive to manage and operate systems in compliance with standards to address the risk of loss arising from information security and the protectionof personal information. In addition, if deemed necessary, the Company will require its subsidiaries to obtain JIS Q 27001 (ISMS) or the Privacy Markcertification in order to establish information security systems that are equivalent to its own.
(3) The Company will conduct internal control system audits related to the status of day-to-day business execution of the departments of the Company
and its subsidiaries through the Internal Audit Office, which is under the direct control of the President. It will identify risks that could lead to the riskof loss and evaluate those risks, along with confirming the status of responses to risks. If there is an Internal Audit Office within a subsidiary, with thepermission of the Company’s Internal Control Committee, the Company may delegate a portion or all of the evaluation process for internal control
system audits at its subsidiary to the Internal Audit Office of the subsidiary.
4. System to Ensure the Efficient Performance of Duties by the Company’s Directors and the Directors, etc. of the Company’s Subsidiaries

(1) The Company will streamline the Board of Directors by adopting an Executive Officer System, thereby ensuring speedy and efficient management
decision-making in accordance with the Rules of the Board of Directors. The Board of Directors will hold regular meetings once a month and convene
extraordinary meetings as necessary.
(2) In accordance with the Rules of the Executive Committee, the Company will establish the Executive Committee comprising Full-time Directors,
Full-time Audit & Supervisory Committee Members, Executive Officers, business department managers and certain other personnel. The Executive
Committee will discuss issues related to business execution, along with evaluating key agenda issues that should be brought before the Board of
Directors and reporting to the Board of Directors, and the President and CEO. The Executive Committee will meet once a month on a regular basis
and convene extraordinary meetings as necessary.
(3) To pursue business efficiency, the Company will continue to move forward on developing its internal control systems and reforming its businessprocesses.
(4) The Company will dispatch Officers to significant subsidiaries to determine whether their Boards of Directors have developed a system to ensure
the efficient performance of duties by Directors and are implementing the system effectively. If it is judged that there is a need for improvement, theOfficers will request that the Directors or Board of Directors implement improvements.
5. System for Reporting Matters Related to the Performance of Duties by Directors, etc. of the Company’s Subsidiaries and Other Systems to Ensure
the Proper Operations of the Corporate Group Comprising the Company and Its Subsidiaries(1) In accordance with this basic policy, the Company will establish internal control systems appropriate to the Company’s size and business activities,
along with implementing and evaluating the system. At the same time, the Company will evaluate the establishment and implementation of internal
control systems at subsidiaries.
(2) If approved by the Company’s Internal Audit Office and its Internal Control Committee, the evaluation work will be carried out by the internal
audit offices of subsidiaries.
(3) The Company will dispatch Officers to significant subsidiaries and monitor the business and financial condition of subsidiaries through their
executive committees. The Company’s Board of Directors and Executive Committee receive reports on the subsidiaries’ business and financial
condition from the dispatched Officers or the Officers of the subsidiaries, along with discussing important matters.
(4) In accordance with the Group Company Management Rules, the Company will stipulate matters requiring prior approval as well as matters requiring
prior and ex post facto reporting, and subsidiaries will be required to comply with those stipulations.
6. Matters Concerning Directors and Employees Responsible for Assisting the Duties of the Company’s Audit & Supervisory Committee
If the Audit & Supervisory Committee requests the assignment of assistants, the staff members of the Internal Audit Office shall be entrusted toassist the duties of the Audit & Supervisory Committee.
7. Matters Concerning the Independence of Directors and Employees Described in the Previous Item from other Directors of the Company (excluding
Audit & Supervisory Committee Members) and Matters Concerning Ensuring the Effectiveness of Instructions to Such Directors and Employeesby the Company’s Audit & Supervisory Committee. Any personnel transfers of and disciplinary measures against the assistants described above
will require the approval of the Audit & Supervisory Committee. Moreover, personnel evaluations will be undertaken based on a hearing of theopinions of the Audit & Supervisory Committee. During the period designated for assistance by the Audit & Supervisory Committee, the Audit &Supervisory Committee will have the authority to direct the assistance duties of the designated employees, and the employees will not be subject
to the directions and orders of the Directors.
8. System for Reporting to the Company’s Audit & Supervisory Committee(1) The Company’s Full-time Audit & Supervisory Committee Members attend important meetings such as meetings of the Board of Directors,
Executive Committee, and Internal Control Committee, as well as the Group Presidents’ Meeting, to ascertain the status of management decisionmaking and business execution at the Company and its subsidiaries. The Directors (excluding Audit & Supervisory Committee Members) and
Executive Officers provide necessary reporting to the Full-time Audit & Supervisory Committee Members through the above meetings or day-to-day
operations. Furthermore, the Full-time Audit & Supervisory Committee Members view materials such as documents about business execution,
including circular approval forms, and seek explanations from Officers and employees as necessary. The Full-time Audit & Supervisory Committee
Members will provide the necessary reporting to the Part-time Outside Director on a timely basis through the Audit & Supervisory Committee or otherappropriate means.
(2) In accordance with the Group Company Management Rules, the Company will stipulate matters requiring prior approval as well as matters requiring
prior and ex post facto reporting, and subsidiaries will be required to comply with those stipulations. Managers of departments that receive reports
from subsidiaries will report to the Company’s Audit & Supervisory Committee on a timely basis. If such reporting is provided only to Full-time Audit& Supervisory Committee Members, the Full-time Audit & Supervisory Committee Members will provide the necessary reporting to the Part-time
Audit & Supervisory Committee Members on a timely basis through the Audit & Supervisory Committee or other appropriate means.
(3) The Audit & Supervisory Committee will conduct monitoring to ensure that informants reporting to the Audit & Supervisory Committee are nottreated unfavorably as a result of making such reports and will request that improvements and other measures be undertaken by the Board of Directors
as necessary.
9. Other Systems to Ensure that Audits by the Company’s Audit & Supervisory Committee Are Performed Effectively(1) The Company will strive to strengthen coordination among the three types of audits performed by the Audit & Supervisory Committee, Internal
Audit Office, and the audit firm. Moreover, the Audit & Supervisory Committee will regularly exchange opinions with the President and CEO, andthe audit firm.
(2) To enhance the effectiveness of audits of the Group as a whole, the Company has established the Liaison Meeting for Group Corporate Auditors,
which meets regularly. Through the Liaison Meeting, the Company’s Audit & Supervisory Committee and the Corporate Auditors of subsidiaries
exchange information and opinions and work to enhance audit operations as a corporate group, contribute to risk management, and support managementfrom a defensive perspective. The Liaison Meeting for Group Corporate Auditors holds regular meetings once every quarter and convenes extraordinary
meetings as necessary.
(3) The Company budgets for the expenses necessary for the performance of the Audit & Supervisory Committee Members’ duties (limited to expenses
related to the performance of the duties of the Audit & Supervisory Committee) at the beginning of the fiscal year. If expenses necessary to theperformance of duties other than the budgeted expenses arise, the Company will pay those expenses in advance on a case-by-case basis or the Audit& Supervisory Committee Members may claim reimbursement for those expenses after they are incurred.
＜Development Status＞
In accordance with the enforcement of the amended Whistleblower Protection Act in June 2022, the Board of Directors established new internal
rules on whistleblowing at a meeting in May 2022. These internal rules are being extended to subsidiaries, and the Company is developing a Groupwide whistleblowing system.

2. Basic Policy on and Status of Implementation of Efforts Toward Removal of Anti-social Forces

The Company’s basic policy is to resolutely oppose anti-social forces that have a negative impact on social order and the sound operations of businesses
and to cut all relations with such entities. With this in mind, the Company has codified this policy in its Corporate Ethics Guidelines and ComplianceStandards of Conduct, and will routinely communicate this policy to all employees to ensure that they will comply with it.

Ⅴ Others
1. Adoption of Takeover Defense Measures
Adoption of Takeover Defense Measures

Not Adopted

Supplementary Information for Applicable Items―――

2. Other Matters Related to the Corporate Governance System, etc.
【Overview of System for Timely Disclosure】The Company believes that timely disclosure for investors and other stakeholders is an importantmanagement issue. Based on this belief, it will actively and rapidly provide disclosure of information.
Specifically, the Company’s internal structure for providing timely disclosure works as follows.
The General Manager of the Corporate Planning Dept. is the Company’s Information Disclosure Manager and Information Handling Manager. Under
the direction of the Information Disclosure Manager/Information Handling Manager, the Corporate Planning Dept. discloses information as thedepartment responsible for information disclosure.
With regard to decision facts and financial information (including quarterly disclosure), following institutional decisions on such matters by the Boardof Directors or their approval thereof, the department responsible for information disclosure promptly provides disclosure under the direction of theInformation Handling Manager.
With regard to occurrence facts and other corporate information, information is gathered from the relevant departments and Group companies andconsolidated under the Information Disclosure Manager/Information Handling Manager. The Information Disclosure Manager/Information HandlingManager considers factors such as the materiality of the information and reports material information to the President and CEO. If the information is
judged to be a matter for disclosure, the Information Disclosure Manager/Information Handling Manager will instruct the department responsible for
information disclosure to disclose it.
The flow of the timely disclosure process described above is depicted graphically in the attachment titled “Timely Disclosure System (Schematic
Diagram).”[Attachment: Timely Disclosure System (Schematic Diagram)]
Decision facts and financial information

Occurrence facts and other corporate
information

Board of Directors

Relevant departments and Group companies

Information Disclosure Manager / Information Handling Manager

President and CEO

Information Disclosure Manager /Information Handling Manager

Department responsible for information disclosure

Tokyo Stock Exchange

News media organizations

Website