Our Sustainability
Introducing the Board of Directors
Director

Masazumi Hasumi

Masayuki Yagi

Takeshi Matsuura

Hideo Matsuda

Michihiro Nagasaka

Haruo Shimada

President

Director, Managing Executive Officer

Director, Managing Executive Officer

Director, Executive Officer

Director

Director Outside

August 1983
Joined Aoyama Audit Corporation
November 1991 Joined Yamada & Partners Accounting
OfficeDecember 1996 President of Proggest Co., Ltd.
(company name changed to Proggest
Holdings, Ltd. in July 2005)
July 2005
President of Proggest Co., Ltd. (current:
Aoyama Zaisan Investments Co., Ltd.)
September 2008 Director of the Company
October 2008
President
August 2016
Business Succession Navigator
Corporation(currently Next Navi), President
June 2017
PT Aoyama Zaisan Networks
Indonesia, Director (current position)
March 2018
Chairman of Nihon Shisan Soken Co.,
Ltd. (current position)
October 2020
Aoyama Financial Service Co., Ltd.
Representative Director
January 2021
Aoyama Family Office Service Co., Ltd
President (current position)

April 1990
September 1991
March 2006

April 1991
May 1995

April 1984

April 1985
March 1992
December 2010

January 2011
March 2013
March 2014

January 2021

June 2021
January 2022
March 2022
March 2022

Joined Murakami Corporation
Joined the Company
Director, Executive Officer, and Manager of First
Business Department
Executive Officer of the Company
Manager of Individual Asset Consulting Department
Director, Executive Officer, and General Manager ofBusiness Division
Director, Managing Executive Officer of theCompany
Director, Executive Officer, and General Manager ofBusiness Division
Director, Managing Executive Officer of theCompany
General Manager of Business Division andGeneral Manager of Real Estate Division II
Business Succession Navigator Corporation(currently Next Navi), Director
Director, Managing Executive Officer, and General
Manager of Administration Division of the Company(current position)
Director of Aoyama Estate Co., Ltd. (current
position)
Director of Aoyama Zaisan Investments Co., Ltd.
(current position)

October 2000
January 2005
January 2006
March 2007
January 2011
March 2014
March 2016
June 2017
January 2021
January 2022

Joined Daiwa House Industry Co., Ltd.
Joined Nissho Iwai Real Estate Corp. (current: Sojitz
Corporation)
Joined the Company
Executive Officer, Manager of Real-estate
Department
Funai Estate Co., Ltd.
(currently Aoyama Estate Co., Ltd.)
President
Director, Executive Officer, and Manager of Business
Division 6
Executive Officer, Manager of Real-estate
Department
Director, Executive Officer, and General Manager ofReal Estate Division of the Company
Director, Managing Executive Officer of the Company
General Manager of Real Estate Division
Director of Shinsei Aoyama Partners Co., Ltd.
(current position)
Director, Managing Executive Officer of the Company
General Manager of Real Estate Division I
Director, Managing Executive Officer of the Company
General Manager of Real Estate Division (current
position)

Joined Sato Sumio Zeirishi Jimusho(current: Meinan Keiei Tax Corporation)

December 2014 Representative Director of Meinan Zaisan
Consultants Co., Ltd.
January 2018
Joined the Company
Executive Officer of the Company
General Manager of General Information
Network Division
March 2018
Director, Executive Officer
General Manager of General Information
Network Division
October 2020
Aoyama Financial Service Co., Ltd.
Director (current position)
January 2021
Aoyama Zaisan Networks Kyushu Co.,
Ltd. Director
January 2022
Director, Executive Officer
General Manager of General Information
Network Division (current position)

March 2014
April 2015
July 2021
March 2022

Joined Wakabayashi Law Office
Joined Nihon M&A Center Inc.
Manager of Business Promotion
Department
Outside Director of the Company
Manager of Sales Support Department,
General Planning Division of Nihon M&A
Center Inc.
Business Succession Navigator
Corporation (currently Next Navi),
Director (current position)
Director of the Company (current
position)

April 1975
April 1982
March 1986
June 2000
March 2007
April 2007
May 2015
January 2016
April 2017
February 2021

Independent

Associate professor of Faculty of
Economics, Keio University
Professor of Faculty of Economics, Keio
University
Visiting professor of Massachusetts
Institute of Technology
Research Center for Advanced Scienceand Technology, the University of Tokyo
Visiting Professor
Outside Director of the Company (current
position)
President of Chiba University ofCommerce
Outside Director of Okaya & Co., Ltd.
(current position)
President of Shimada Sogo Kenkyujo(current position)
Chairperson of the Board of Trusteesof Tokyo Metropolitan Public University
Corporation
Outside Director of Tech I.S. Co., Ltd.
(current position)

Audit & Supervisory Board Member

Hiroyuki Fujita

March 2018

Audit & Supervisory Board Member Outside
April 1989
August 1995
October 2000
April 2004
March 2018
March 201824

Takaomi Ogawa

Shintaro Hashiba

Shinji Shimane

Keiji Watanabe

Director, Managing Executive Officer

Director, Managing Executive Officer

Director, Executive Officer

Director Outside

September 1992 Joined Takano Yasuo Zeirishi Jimusho(current: Zeimu Sogo Tax Corporation)
August 2003
Director of Funai Zaisan Consultants
Keiyo Co., Ltd.
(currently Nihon Shisan Soken Co., Ltd.)
December 2009 President of Funai Zaisan Consultants
Keiyo Co., Ltd. (currently Nihon Shisan
Soken Co., Ltd.)
October 2013
Executive Officer, General Manager of
NSS Division of the Company
March 2016
Director, Executive Officer, General
Manager of NSS Division
June 2017
President of Nihon Shisan Soken Co.,
Ltd. (former: Nihon Shisan Soken
Consultant Inc.) (current position)
April 2020
Representative Director of Nitto
Fudosan Co., Ltd. (current position)
January 2022
Director, Managing Executive Officer of
the Company
Consulting Business Supervisor andGeneral Manager of NSS Division(current position)
March 2022
Director of Aoyama Financial Service
Co., Ltd. (current position)

April 1987

October 1995

July 1987

Aoyama Zaisan Networks ｜ Integrated Report 2022

Joined The Kyowa Bank, Ltd. (current: Resona
Bank, Limited)
October 2003 General Manager of Shin-Yurigaoka Branch
October 2004 General Manager of Tokyo Central Marketing Division 1
July 2008
General Manager of Shin-Toshin Marketing Division 3
May 2014
Director of J-COM Co., Ltd. (current: LIKE, Inc.)
Deputy General Manager of Sales Division
and General Manager of Business
Development Division
August 2014
Director of J-COM Holdings Co., Ltd.
(current: LIKE, Inc.)
November 2015 Joined the Company, General Manager ofManagement Planning Office
August 2017
Executive Officer, General Manager of
Administration Division
March 2020
Director, Executive Officer, General Manager
of Administration Division
July 2020
Director, Executive Officer, General Manager
of Management Planning Division
January 2022 Director, Managing Executive Officer of the Company
General Manager of Corporate Planning
Division (current position)
March 2022
Aoyama Financial Service Co., Ltd.
President (current position)
March 2022
Director of Aoyama Zaisan Networks Kyushu Co.,
Ltd. (current position)

Joined Ota Showa Audit Corporation(current: Ernst & Young ShinNihon LLC)
October 2000
Joined Avaya Japan Ltd.
September 2001 Joined Proggest Co., Ltd.
(currently Aoyama Zaisan Investments
Co., Ltd.)
August 2006
Director (concurrent)
January 2016
Representative Director of Shinsei
Aoyama Partners Co., Ltd.
(current position)
March 2016
Director, Executive Officer
Business succession consulting
General Manager of Business Division
January 2021
Director, Executive Officer
General Manager of Consulting
Business Division 4
January 2022
Director, Executive Officer, and General
Manager of BusinessSuccession Fund Services (current
position)
March 2022
Aoyama Zaisan Investments Co., Ltd.
Representative Director (current
position)Independent

Aoyama Audit Corporation(current: PricewaterhouseCoopers Aarata
LLC), Representative Partner
April 1996 Joined Tohmatsu & Co.
(current: Deloitte Touche Tohmatsu LLC)
Representative Partner
June 2000 Outside Director of Ichiyoshi Securities Co.,Ltd.
July 2003
Deloitte Touche Tohmatsu Global
Middle Markets Leader
June 2008 Outside Director of ASAHI KOGYOSHA CO.,LTD. (current position)
June 2010 Outside Director of SBI Holdings, Inc.
March 2011 Outside Director of the Company (current
position)
June 2017 Outside Director of SBI Insurance Group Co.,
Ltd. (current position)
June 2017 Outside Audit & Supervisory Board Memberof Hokuetsu Kishu Paper Co., Ltd. (current:
Hokuetsu Corporation) (current position)
June 2018 Outside Director of UKAI Co., Ltd.

Independent

Joined The Mitsui Bank, Limited (current: Sumitomo
Mitsui Banking Corporation)
Joined Yamazaki Certified Tax Accountant Office
Joined Tohmatsu & Co.
(current: Deloitte Touche Tohmatsu LLC)
Registered as a CPA
Appointed as outside Audit & Supervisory Board
Member of the Company (current position)
Audit & Supervisory Board Member of Nihon Shisan
Soken Co., Ltd. (current position)

Hisao Nakatsuka
April 1994
January 1996
January 1999
November 2001
March 2002
August 2002

Independent

Joined The Tokai Bank, Limited (current: MUFG
Bank, Ltd.)
General Manager of Fujisawa Branch
General Manager of Chofu Branch
General Manager of Takenotsuka Branch
Joined the Company
Director, General Manager of Consulting
Department
Director, General Manager of Administrative
Department

Hiroaki Rokugawa
Audit & Supervisory Board Outside
April 1997
April 1997
June 2002
March 2007
April 2007
June 2008

April 2020
October 2020
January 2021
June 2022

March 2005

Audit & Supervisory Board Member Outside
April 1970

December 2019

Business Succession Navigator Corporation(currently Next Navi), Audit & Supervisory Board
Member (current position)
Audit & Supervisory Board Member of Aoyama Zaisan
Networks Kyushu Co., Ltd. (current position)
Audit & Supervisory Board Member of Nitto FudosanCo., Ltd. (current position)
Audit & Supervisory Board Member of Aoyama
Financial Service Co., Ltd. (current position)
Aoyama Family Office Service Co., Ltd
Audit & Supervisory Board Member (current position)
Nihon Digital Investment Co., Ltd.
Audit & Supervisory Board Member (current position)

Independent

Registered as Attorney (Dai-Ichi Tokyo Bar
Association)
Joined Hori & Partners
Joined Barack Ferrazzano Kirschbaum &Nagelberg LLP (Chicago)
Joined Tokyo Aoyama, Aoki, Koma Baker &McKenzie Law Office
Lecturer of Advanced Institute of Industrial
Technology (current position)
Representative Attorney of Ogasawara Konno &Rokugawa

Funai Estate Co., Ltd.
(former: Aoyama Estate Co., Ltd.) Audit &Supervisory Board Member
April 2006
Managing Director of the Company
September 2008 Audit & Supervisory Board Member of Proggest
Co., Ltd.
October 2010
Director of Aoyama Estate Co., Ltd.
October 2013
Audit & Supervisory Board Member of Nihon
Shisan Soken Co., Ltd.
March 2014
Director of Nihon Shisan Soken Co., Ltd.
March 2015
Advisor of the Company
March 2016
Audit & Supervisory Board Member (current
position)
March 2009

Outside Audit & Supervisory Board Member of
the Company (current position)
April 2013
Professor of Graduate School of Law, Tokai
University
December 2016 Tsunagu Group Holdings, Inc.
Outside Director (current position)
September 2017 Outside Auditor of OKWAVE Inc. (current position)
September 2020 Outside Director and Audit & Supervisory Board
Member of Abalance Corporation (current
position)
April 2021
Outside Auditor of Yumeshin Holdings Co., Ltd.
(current position)
April 2022
Representative Attorney of Tokyo Uchisaiwaicho
Law Firm (current position)
June 2022
Outside Director of Meiji Machine Co., Ltd.
(current position)

Aoyama Zaisan Networks ｜ Integrated Report 2022

25

Our Sustainability
Corporate Governance●Compensation for officers

Basic concept of corporate governanceTotal amount per type of compensation (thousand yen)

Based on our corporate policy of always making proposals from the client’s standpoint with a fair and neutral
attitude, AZN firmly believes it is essential to establish corporate governance to ensure compliance-oriented management and to practice this policy. The Company’s Boardof Directors and Audit & Supervisory Board acknowledge
that the corporate governance framework should primarily
perform the following functions.

⃝ To protect and encourage the exercise of shareholders’ rights.
⃝ To ensure equal treatment of all shareholders.
⃝ To make timely and accurate disclosure regarding all theimportant matters related to the company, including its financial
conditions, operating results, shareholder composition, andgovernance.
⃝ To ensure the strategic orientation of the company, effective
supervision of management executives, and clear accountability.

Corporate Governance System

Total amount ofcompensation(thousand yen)

Basiccompensation

Bonus

Restricted stockcompensation

Other

Director(except outside Director)

211,394

90,372

76,941

32,974

11,10644,081

7

Audit & Supervisory Board
Member(excluding Outside Audit &Supervisory Board Members)

5,300

4,800

500

－

－

－

1

Outside Officer

47,58040,380

7,200

－

－

－

5

Category of officer

Performance-linked

Evaluation of the effectiveness of Board of Directors

The Company ensures the effectiveness of audits of
Directors' performance of their duties by maintaining theindependence of its Auditors and Audit & Supervisory
Board Members from the Board of Directors, and bycollaborating with auditing firms and its in-house audit-

ing department. Moreover, to strengthen the supervisory
function of the Board of Directors, the Company has established the Compensation Council and the Nominating
Committee, at least two of whose members must be
Outside Directors.

(1) Board of Directors

The Board of Directors deliberates and makes decisions on important matters concerning the Company’s management, and oversees theCompany's business and general management. Each of the two Outside Auditors has an advanced level of expertise, and they provide reliable
management oversight from their professional perspectives.

(2) Executive Officers

In light of the segregation of management and implementation, AZN has instituted an Executive Officer system. Executive Officers execute theoperations of the divisions or departments under their control, in accordance with organizational regulations and rules on the segregation of duties
set forth by the Board of Directors.

(3) Executive
Committee

The Executive Committee, consisting of the President, full-time Directors, and Executive Officers, meets on a weekly basis to verify management
policies and discuss management strategies and business execution for the purpose of sharing problem awareness and having smoothcommunication among all members.

(4) Compensation
CouncilRemuneration for directors, within the total scope of remuneration approved by the General Meeting of Shareholders, is determined by theCompensation Council, which is composed of Directors selected by resolution of the Board of Directors. The Compensation Council is composedof three or more Directors, at least two of whom must be outside Directors as a rule for the purpose of raising the transparency and objectivityof the review process.

(5) Nominating
Committee

The Nominating Committee, a voluntary advisory body to the Board of Directors, deliberates on the selection and dismissal of senior management
and Directors and recommends candidates to the Board of Directors, which are decided by the Board of Directors. Also, the Nominating
Committee is composed of three or more Directors, at least two of whom must be outside Directors as a rule for the purpose of raising thetransparency and objectivity of the review process.

(6) Compliance
Committee

The Compliance Committee, consisting of the President, full-time Directors, Executive Officers/General Managers of the divisions, and external
legal counsels (attorneys), has been established in conjunction with the Board of Directors as a forum for deliberation on risk management andlegal compliance by the Company.

(7) Sustainability
Committee

The Sustainability Committee, consisting of the President and full-time Directors, was established to build a foundation for sustainable growth,
to oversee and monitor sustainability policies, strategies, and measures, and to manage and evaluate the progress of objectives resolved by the
Board of Directors.

AZN strives constantly to improve the effectiveness of its Board of Directors. AZN undertakes
an annual questionnaire survey of all Directors
and Audit & Supervisory Board Members regarding the effectiveness of the Board of Directors,
using the evaluation points listed at right. The
results are then discussed and reported to theBoard of Directors.
See right for a summary of last fiscal year's
survey results.

Audit & Supervisory Board

Audit Firm

Board of Directors

Compliance Committee
Sustainability Committee
Executive Committee

President
Departments / Affiliates

Internal Audit Office

26

Aoyama Zaisan Networks ｜ Integrated Report 2022

Report discussion
results to theBoard of Directors

Questionnaire evaluation items

Summary of questionnaire results
About the Board of Directors of theCompany, there were no important mattersraised in each evaluation item, whereas some
findings about the Board of Directors
operations were noted. We intend to makesome improvements, aiming to realize a more
effective Board of Directors.

Executive Officers● Operation of the Board of Directors● Agendas of meetings of the Board of Directors● Supervisory framework by the Board of

Directors● Supervisory framework by shareholders

Risk management
Based on its Crisis Management Regulations, AZN defines external crises, internal crises, disasters, and othercrises as described at the right, and defines how to respond to crises when they occur. In the event of a crisis that seriously threatens corporate operations, a task
force is immediately formed and company-wide action istaken to resolve the problem.

1E
 xternal
risks● Information leak❶
❷ Problems involved in business operations (including●
customer consulting services)❸ Civil violent incidents, contact/problems with anti●social forces❹ Criminal acts by employees (fraud etc.)●❺ Other risks/incidents associated with AZN’s credit●

2 Internal
risks

❶T
●
 raffic accidents by employees (property/personal
damage)❷ Internal troubles (sexual harassment etc.)❸ Mishaps of employees and their families, other work
accidents❹ Other cases constituting a crime by employees

3D isastersetc.

❶ Extraordinary disasters including natural disasters●

Information security management
For the purpose of continually maintaining and strengthening our information security management structure including personal information management, we have obtained the International Organization for Standardization(ISO) 27001 international accreditation and information

security management system certification. We have developed and maintain systems based on this standard,and continue to further strengthen our systems for managing confidential information.

Compliance initiatives

Compensation for officers
AZN's Board of Directors has adopted a policy for determining the details of compensation for individual Directors.
Compensation for individual Directors for the fiscal year
in question is determined by the Compensation Council,
which is composed of 3 or more Directors (at least 2 ofHave discussions
based onquestionnaire
results● Composition of the Board of Directors andGeneral Meeting of Shareholders

Nominating Committee

Collect responses fromall the Directors andAudit & Supervisory
Board Members

Conduct aquestionnaire

Legal Counsel

Compensation Council

Of the following, Number of eligible
officers
non-monetary(persons)
compensation,etc.

whom must be Outside Directors) selected by the resolution of the Board of Directors to increase the transparency and objectivity of the review process. Its methodsof determining the details of compensation and the compensation so determined shall be consistent with the decision-making policy resolved by the Board of Directors.

For the purpose of practicing fair and bona fide
management in compliance with laws, a Compliance
Committee consisting of the President, full-time Directors,
Executive Officers/General Managers of the divisions, andoutside legal counsels (attorneys) has been established.
The Compliance Committee performs the following operations:❶ To recognize potential risk of losing trust from the securities market
and clients in business operations, and prepare countermeasures(draft)❷ To review if there is any compliance issue with specified joint realestate venture operations, and give approval of their execution❸ To review and report preventive measures against serious
compliance violations❹ To examine/check suspicious compliance activities (potential
compliance violations)

Aoyama Zaisan Networks ｜ Integrated Report 2022

27

Our Sustainability
Message from Outside Directors

Establishing a Japanese-style property
consulting service: the significanceof Aoyama Zaisan Networks andexpectations for the future
Two outside directors, responsible for supporting the governance of Aoyama Zaisan Networks, havegiven us an overview of the situation in Japan and abroad, sharing their views on issues for the growthof AZN Group. The following is a summary of the key points for the further growth of AZN, as highlighted by the dialogue between these two experts in economics and management.

Expanding consulting revenue isfundamental to corporate growthsulting capabilities, it will also be necessary to train up an
R&D division in the future.

Improving property consulting capabilities throughthe use of technology
As a consulting firm, we believe that securing excellent
human resources and improving our property consulting
capabilities are our lifelines. Analog consultant training
systems are sure to result in slow growth and limited increases of productivity. We must constantly strive to improve our property consulting capabilities and quality by
utilizing the latest technologies (DX, AI, Big Data, etc.).
To this end, it is essential that we further upgrade theART system, which systematizes AZN Group's hard-won
expertise, and that our consultants utilize the system consistently. Development of the ART system to utilize Big
Data and AI as well as accumulating and analyzing client
data is an urgent task. In order to develop consulting toolsthat utilize next-generation technologies to solve complex
social issues and to constantly diversify our property con-

Promoting the advancement of women
In today's industrial society, diversity of human resources is becoming more and more important, and it has been
proven that this leads to corporate innovation in termsof both quality and quantity, which in turn leads directly
to corporate development and increased productivity. At
AZN, we believe that diversity is also necessary to revitalize the organization and increase productivity. In order toprovide consulting services that fully meet the needs of ourclients, it is important to secure excellent human resources and ensure women take on active roles. Expanding ourcount of female directors and female consultants is essential for AZN Group's growth. We hope to achieve this assoon as possible. The Sustainability Committee engages
in committed discussions on developing a work environment in which women can work in an ongoing fashion,and through the Board of Directors, AZN supports thesteady implementation of specific activities for women.
We believe that creating a rewarding work environment
in which a diverse workforce can maximize its abilities, aswell as a consultant training system, will enable us to increase revenues from our property consulting services for
mid-sized corporate owners nationwide and asset owners
in the Tokyo metropolitan area, who represent the main
focus of our Group.

Outside Director

Haruo Shimada

Developing consulting in non-property fields
Business succession has become a social issue dueto the aging out of managers and the lack of successors,
but we believe that a "Japanese-style family business" forultra-wealthy and long-lived companies has great potential to contribute to the growth of Japanese companies.
Japanese family businesses have a long tradition of family
management, and they tend to cherish family unity, family
28

Aoyama Zaisan Networks ｜ Integrated Report 2022

precepts, and philosophy. We believe that it is not possible to provide consulting services for family businesses inJapan without understanding Japan’s unique approach tofamily relationships and business, and that even if adopted, overseas examples of family business would simply
not be successful.
We have over 30 years of experience in consulting withclients on their property and business succession matters,
and have a thorough understanding of family businessin Japan. We have also worked hard to promote the establishment of the Aoyama Family Office Service in 2021
by by appointing family business experts to the Board of
Directors. AZN believes that our comprehensive property
consulting services in both property and non-property fields
demonstrate the uniqueness and diversity of our Group.
We continue to build consulting expertise in non-property fields as well, which we believe will lead to stronger
contact with the ultra-wealthy through the provision offamily business services, and beyond that, to property
consulting.

Growth of real estate solutions
We observe significant growth potential for consulting
services that leverage our strengths in real estate solutions, such as the Advantage Club, AZN Group's mainstay consulting product, provision of income-producing real estate properties, and effective real estate use
consulting. Demand for AZN's ability to expertly identify
properties and seamlessly handle purchases, holding,management, and sale of income-producing real estateis expected to continue to grow, and the demands of ourGroup’s clients will continue to expand.
We also engage in a wide range of initiatives to contribute to the Sustainable Development Goals (SDGs), including the long-term preservation and effective utilizationof our clients' assets. In this context, Japan has strong
needs for regional development through the utilizationof idle land, and our Group has a proven track record of

Outside Director

Keiji Watanabe

public–private partnerships in this domain through application of the Act on Specified Joint Real Estate Ventures.
With respect to decarbonization initiatives, we believe thatgrowing social demands can be met using solar power
generation and other technologies, and by continuously
providing environmentally friendly real estate, which willlead to long-term preservation of assets and stable revenue for our clients. We believe that by developing initiatives for decarbonization for Advantage Club properties,
which have been significantly expanded since the previous fiscal year, we can both meet client demands andcontribute to society.

Flow of expanding operational demands
In Japan, the Kishida administration's New Capitalism
plan for action has formulated the Doubling Asset-Based
Income Plan, which is expected to reinforce the trend
away from savings and toward investment. Although
Japan lags behind the rest of the world in asset management, AZN plays a role in expanding investment opportunities for Japanese asset owners and corporate owners,
and undertakes comprehensive management of assets.
In addition to real estate solutions, which are AZNGroup's forte, Aoyama Financial Service was establishedin 2020 to provide client-focused financial instrument consulting services, and AZN has put in place a system forproviding investment management services. In addition,
the revision of the Financial Instruments and Exchange
Act in 2020 made it possible to issue digital securities.
Our Group has plans to provide a service to enable thepurchase of income-producing real estate properties
in small amounts, 24 hours per day, 365 days per year,
through a STO (Security Token Offering) initiative that utilizes blockchain technology. We expect this to create newinvestment opportunities for our clients, thereby increasing revenue prospects for our Group.
Although the Japanese economy has lagged behind
global economic development for the last 30 years or
more, Japan's aging population represents a significant
stock of tangible and intangible assets. The cornerstoneof AZN Group's growth strategy for the future will be to
pursue contact with the wealthy in our aging society andmaximize asset value from a global perspective, while
adopting best practices from around the world, with aview to utilizing the assets of wealthy individuals aroundthe world.
◇◇◇
AZN is seeking to achieve further growth by offering thisdiverse range of services, and by fully embracing interpersonal skills as the foundation for property consulting,as well as driving forward with technology through the useof DX and AI. We anticipate ample growth, moving toward
our long-term vision of becoming Japan's No. 1 comprehensive property consulting firm supported by clients who
know, "When it comes to property, it's Aoyama Zaisan
Networks."

Aoyama Zaisan Networks ｜ Integrated Report 2022

29

Our Sustainability
Sustainability management
Instituting the Sustainability Committee

A process of identifying materiality

As we aim to be the best partner for our clients, not onlyin this generation but also of the next generation and thefollowing generations, under our slogan of 100-year property consulting, we believe that succession, operation, andmanagement to sustain and improve significant assets isan essential aspect not only for our clients but also for ourgroup's corporate activities.
For this reason, in February 2022, in line with the Third
Medium-Term Management Plan, AZN Group instituted the
new Sustainability Committee in conjunction with the Boardof Directors with the aim of further improving corporate quality as a sustainable company based on Environmental, social,governance (ESG)/sustainable development goals (SDGs)
approaches.
The Sustainability Committee seeks to construct a foundation for sustainable growth by managing and evaluating the
progress of targets set by the Board of Directors, while at thesame time overseeing and monitoring sustainability policies,
strategies, and actions. Members consist of Representative
Directors and full-time Directors, with the President serving as Chair of the Management Committee and myself, aDirector, Managing Executive and General Manager of the
Administration Division, serving as Executive Director of theCommittee.
The Sustainability Committee is responsible for proposing and promoting specific activities for improvement,
based on various themes and perspectives including
Promotion of TCFD, Instilling Management Philosophy andStrengthening Human Resources, Changing Work Styles,
Social Contribution, and Strengthening Governance. Each
subcommittee discusses certain issues and seeks to implement solutions. TCFD handles climate change response, etc.
Instilling Management Philosophy and Strengthening Human

We make every effort to solve our clients' asset-related problems, based on our management objectives ofcontributing to the happiness of our clients through thesuccession, operation and management of property, andensuring both the physical and mental well-being of thosemembers who work with us.
On the other hand, environmental and social risks havecontinued to escalate in recent years—as well as financial
issues, we should conduct our business while incorporating non-financial issues in light of ESG in management

Step

Masayuki Yagi

Executive Director, Sustainability Committee
Director, Managing Executive Officer
General Manager of Administration Division

Resources handles management philosophy, education systems, recruitment strategy, etc. Changing Work Styles handles company-wide efficiency of meetings, opportunities for
women to play more active roles, health management, etc.
Social Contribution handles social contribution activities, etc.
Strengthening Governance handles redevelopment of internal regulations, information security, etc.
The members of each subcommittee are selected by the
Executive Director from among personnel at related departments. Each subcommittee sets goals and plans for achieving these goals, and undertakes activities through a processof repeated discussion and verification.

● Objectives & operations

Objectives

Operations⃝ In line with the Third Medium-Term Management Plan, AZN instituted the new Sustainability Committee in conjunction with the Boardof Directors with the aim of further improving corporate quality as a sustainable company based on ESG/SDGs approaches.
⃝ Under this Committee, subcommittees have been established to promote specific improvements on common themes for
improving corporate quality across the entire company.
Committee
Director

President

Executive
Director

Director, Managing Executive Officer, and General Manager of Administration Division

Committee
Members

Director, Managing Executive Officer, and General Manager of Real Estate Division
Director, Managing Executive Officer, Consulting Business Supervisor and General Manager of NSS Business Division
Director, Managing Executive Officer, and General Manager of Business Division

1

Step

strategies and prioritizing harmony with stakeholders, sothat we can maintain sustainable growth.
For this reason, in FY2020 AZN Group identified as
high-priority issues both project-related materialities suchas reducing the environmental impact of buildings,
and business infrastructure-related materialities such as
human resource development and corporate governance. In identifying materialities, we identify social issues
likely to exert significant impact on our company and on
society, based on the steps shown in the diagram below.

2

Step

Identify social challenges

Hold hearings internally/
externally and evaluate
importanceAnalyze global social
challenges/ESG trends andidentify a wide range ofenvironmental/social/econo
mic issues

Organize social challenges interms of importance forexternal parties (stakeholders)
including ESG investors andimpact on AZN

3

Step

4

Identify materiality
Internal discussions& approvals

Discuss and identify(finalize) important
challenges along two
spectrums: importance for
the Group and importancefor our stakeholders● ESG / SDGs initiatives

E

S

Environment

G

Society◎ Reduction of environmental load ofbuildings◎ Transition to decarbonized society◎ Climate change actions and GHG
reduction◎ Response to climate change◎ Water security management◎ Waste reduction

Governance◎ Human resource development◎ Corporate Governance◎ Human rights in labor environment◎ Anti-corruption policies & practices

and human rights due diligence◎ Diversity promotion◎ Engagement with local community< Relevance of SDGs to Group business >● Subcommittee activities divided into 5 segments

30

Promoting TCFD

Instilling Management
Philosophy andStrengthening Human
Resources

Changing Work Styles

Contributing to society

Stronger governance[SDGs][Quality of interpersonal skills][Quality of work styles][Quality of social contribution][Quality of protection]

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Our Sustainability
Sustainability management
Materiality Policies & Initiatives
AZN aims to address ESG issues by realizing the strategies outlined in its Third Medium-Term Management
Plan, which starts in 2022. As a comprehensive property
consulting company that supports the enduring development of our clients' valuable assets and businesses, weare committed to realizing our management objective of"Contributing to the happiness of our clients through thesuccession, operation, and management of property" byproviding environmentally friendly products and services

to resolve property-related concerns, as well as our efforts
to reduce environmental impact in response to climatechange.
As an advocate of 100-year property consulting, AZN
needs to build on the foundation of human resource development, the source of our consulting services, to ensure
its own sustainable growth. In 2022, we have also established a Sustainability Committee and committed to company-wide efforts to realize a more sustainable society.

E Realizing a decarbonized, recycling-based society
AZN Group is engaged in business activities utilizing
energies from land and other natural resources, and we
recognize that addressing climate change is an important management challenge with a considerable impact on
our business continuity. We also believe that CO2 emissions associated with our real estate operations and otherbusiness activities have a significant impact on climatechange, and thus we consider these a major risk. To thisend, we prioritize environmentally friendly initiatives fortheir ability to contribute to enhancing asset value and resolving social issues, and we will work to meet the needsof both clients and tenants. The Sustainability Committee
will continue to study the current circumstances, utilizing

the TCFD framework on climate change to improve information disclosure and transparency in order to achieve amore sustainable society.
Current ⃝ Switching to environmentally friendly facilities and clean
initiatives
energy-based electricity for Advantage Club⃝ Promoting water conservation and waste reduction in
conjunction with Advantage Club tenants⃝ Promoting the use of environmentally friendly
materials, paints, equipment, etc. by incorporating
FutureESG perspectives into our analysis of current
initiatives
situations and recommendations for land use andconstruction support⃝ Promoting buildings and urban development that areconsiderate of water environment conservation⃝ Reducing waste and greenhouse gas emissions

S Realization of society that supports (the success of) diverse talents
AZN Group considers human resources among its
most valuable management capital, and believes that improving the interpersonal skills and diversity of its employees are key themes in order to contribute to clients and tosociety. In addition to initiatives to improve interpersonal
skills within the company, we will strengthen initiatives thatwill help improve interpersonal skills through our employ-

Case 1

Supporting the establishment and operation of foundations

Establishing a foundation is one way that assets can be used
to contribute to society. However, without specialists in building
managerial systems and in operating and managing assets,sustainable management can be difficult.
At Aoyama Zaisan Networks, by utilizing our expertise in theoperation and management of property and business succession, as well as our internal and external networks, we support
our clients in passing on their assets and philosophy to thenext generation through foundations.
For example, we supported the establishment and operationof a foundation providing scholarships to students from orphanages in order to realize a client's desire to support children
not afforded educational opportunities for economic reasons.
32ees’ own social contribution activities. Employee diversity
is also a crucial aspect of appreciating the diverse valuesof our clients and solving the property issues that exist
in modern society. To promote diversity, we will continue
to create a pleasant working environment for women andother diverse human resources. We believe that by respecting the individuality and autonomy of our employees

Aoyama Zaisan Networks ｜ Integrated Report 2022

We have also introduced an operations and management system that provides guidance and checks to ensure that students are able to use their scholarship funds appropriately, andwe conduct thorough follow-ups together with our client after
establishment. Creating opportunities for higher education enables children to dream and hope for the future.
AZN has also been involved in establishing and operatingother foundations for various purposes, including supporting
human resource development in the fashion industry, laying thefoundation for enjoyment of classical music, and conducting
educational science experiments in the field. We intend to continue helping to connect the hearts and minds of our clients by
utilizing our group’s hard-won expertise.

and constantly providing opportunities for self-improvement and personal growth, we can grow into a company

capable of evolving with social change and our clients’needs, and thus contributing to our clients and to society.

⃝ Instilling our management philosophy through corporate
philosophy training and morning meetings conducted byPresident Hasumi himself⃝ Enhancing consultant training programs such as ART
system training and the Consulting Education Center
Current⃝ Encouraging the use of parental leave
initiatives⃝ Expanding the contract employee system to allow
employees to continue working after the mandatory
retirement age of 65⃝ Giving donations and other support to medical
associations and institutions⃝ Expanding donations to organizations dedicated toeradicating pet euthanasia, promoting subsidized
children's cafeterias, etc., and offering support throughvolunteer activities undertaken by our employees⃝ Promoting advancement of women (increasing the
Futurepercentage of female employees from approximately 30%
initiatives
to 40%, and the percentage of female managers fromapproximately 18% to 30%)
⃝ Maintaining the work environment⃝ Enhance consultant training by using external educational
institutions⃝ Training up management personnel

S Business activities with emphasis on partnerships
As a comprehensive property consulting firm, AZNGroup recognizes our engagement with local communities
is one of the important agenda in terms of resolving social
challenges and protecting property. With our mission, “Toremain your best partner in 100 years,” we strive to contribute to our clients’ happiness through the succession,
operation, and management of property. We regard local
communities as a foundation for the life of all people including our clients, their families, and the companies andemployees they value, as well as a foundation for socialand economic activities and for leading happy lives. To

ensure that our clients can live happily and that the valueof their assets in local communities continues to increase,
we are committed to engaging with local communities.
⃝ Contributing to welfare through land utilization andconstruction support for childcare facilities and seniors
facilities, as well as attracting hospitals, clinics, and otherfacilities of high public benefit
Current ⃝ Creating mechanisms to give back to society byinitiatives
supporting the establishment of foundations⃝ Contributing to urban development and regional
job creation by collaborating with partners (publicorganizations, financial institutions, and companies) on
regional development projects

G Continuing improvement in governance
Recognizing corporate governance as an importantmanagement mechanism to make transparent/fair andspeedy/decisive decisions, AZN Group is actively committed to it. In line with this policy, activities are undertaken appropriately, including the Nominating Committee's determination of director candidates, the Compensation Council'sdeliberations on executive compensation, and evaluation of
the effectiveness of the Board of Directors. For the purposeof practicing fair and bona fide management in compliancewith laws, we have established the Compliance Committee
Case 2consisting of the President, full-time Directors, Executive
Officers/General Managers of the divisions, and external
legal counsels (attorneys) as a structure to further compliance with laws and corporate ethics.
⃝ Establishing appropriate managerial structures for AZNGroup by instituting a Nominating Committee andCurrent
Compensation Council to determine director candidates,
initiatives
as well as succession planning, etc.
⃝ Operating the Compliance Committee and a fair and transparent
Compensation Council to advance legal compliance

Achieving construction of a senior citizen’s facility through subsidies

Beyond making effective use of their property, many of ourclients want to actively contribute to society as representativesof their communities. In one such case, this desire was realized
by becoming the owner of a senior citizens’ facility for which
the local municipality had publicly sought applications.
Just as Aoyama Zaisan Networks was seeking effective applications for use of our client’s land, an open call for business operators to run a senior citizens’ facility was announced.
Although the application deadline was only about a monthaway, these open calls are held on a regular basis. In order tohelp realize the clients desire to contribute to the local community, AZN had been considering ways to make effective use of
the land, including the possibility of such public offerings.

After performing a detailed business income and expense
simulation, we recommended a complex combining a smallscale multifunctional facility with a group home for elderly persons with dementia. After the applications were reviewed andpublic bidding was conducted, our group's proposal was selected. The review process was more difficult because this wasa subsidized project, but the fact that our proposal cleared thereview was evidence that the proposal, including its sustainability, had been highly evaluated, which reassured the client.
We also provided support for selecting business operators andsigning contracts to ensure that the project would be sustainable.

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