BIPROGY Group

BIPROGY Group

Integrated Report 2023

For the Year Ended March 31, 2023

Corporate Philosophy
Our Mission

Work with all people to contribute to creating a societythat is friendly to people and the environment
Our Vision

Be a group that strives to be sensitive to the expectations
and needs of society and that thinks through how ICT cancontribute to meet them

PurposeThe Unique Characteristics and Management Resolve of the BIPROGY GroupOur Values

1. Pursuit of High Quality and High Technology

Always have the latest knowledge that is useful for society while improving our skills

2. Respect for Individuals and Importance of Teamwork

Identify each other’s good points, encourage each other to improve those good points and harness thestrengths of each person

3. Attractive Company for Society, Customers, Shareholders and Employees

Foresight andInsight

Technology

Business
Ecosystem

Company that Creates
Social Value

Listen sincerely to our stakeholders to improve our corporate value

Create a sustainable society using foresight and insight

BIPROGY Group Charter of Corporate Behavior

to unlock the full potential of technology.

We will meet our responsibilities towards society
and the environment to protect the future of ourchildren.

1. A ct with coexistence of people and the environment as thehighest priority
2. A
 lways act according to the principles of social
responsibility

3. S
 incerely work on the core subjects and issues of social
responsibility* Principles of social responsibility
The seven key principles of ISO 26000, the international guidance relating to social responsibility:
accountability, transparency, ethical behavior, respect for stakeholder interests, respect for the rule oflaw, respect for international norms of behavior, and respect for human rights.
* Core subjects and issues of social responsibility
The seven core subjects of ISO 26000, the international guidance relating to social responsibility:
organizational governance, human rights, labor practices, the environment, fair operating practices,
consumer issues, community involvement and development, and relevant issues related to each of
the core subjects.

BIPROGY Group Integrated Report 2023

1

Contents

4Taking on the Challenge of Resolving Social Issues

Concept of Integrated Report 2023

4	At a Glance

We changed our name from Nihon Unisys, Ltd. to BIPROGY Inc. in

6	Purpose

April 2022, reaffirming our determination and resolve to becoming

8	CEO Message

a company that creates social value as set forth under our

14	Transformation from Nihon Unisys to BIPROGY“Purpose” and renewing our corporate brand in the process.

16Strategies Aimed at Realizing Vision 2030

In this report, we explain the value creation process of the Group

that aims to realize the creation of social value and sustainablegrowth through efforts for our Vision 2030 and Management

16	Value Creation Process

Policies (2021-2023) based on our Purpose, which forms the foun-18	Source of the BIPROGY Group’s Value Creation

dation of value-creation in the BIPROGY Group. In the 2023 edition,

20	Vision2030

we primarily introduce the progress we made in the second year of28	Management Policies (2021-2023)

our Management Policies (2021-2023) and initiatives for their final

30	What Our Management Policies (2021–2023)
Aim to Achieve

year as well as initiatives geared towards our material issues.

36	CFO Message

40	Financial Highlights

Origin of Our Name

42	Non-Financial Highlights

44Implementation Capability for Realizing
Vision 2030

44	Dialogue between the CEO and Outside Directors
The Future that the BIPROGY Group Envisions
48	Intellectual Asset Strategy
52	Environment

56	Human Resource Strategy
60	Corporate Governance

76Data Section76	Business Results Summary
79	ESG Data82	11-Year Financial Summary68	Directors, Audit & Supervisory Board Members,
and Corporate Officers

84	Main Themes and Concerns in
Our Dialogue with Shareholders
and Investors

Editorial Policy

73	Risk Management

86	Corporate Information

including shareholders and investors. It is also intended to further their

70	Further Improve Integrity

Scope of the Report
In principle, the scope of the report consists of BIPROGY and its consolidated subsidiaries, and it is individually noted when the scope differs.

Period of the Report
In this report, fiscal year (FY) refers to the period beginning April 1 andending March 31 the following year. In principle, this report covers
FY2022 (April 1, 2022 to March 31, 2023), with activities during past fiscal years and conditions following FY2023 also reported as necessary.
The Company adopted International Financial Reporting Standards(IFRS) for fiscal 2021 and after, but for fiscal 2020 and before, financial information is based on Japanese accounting standards, J-GAAP.
Referenced Guidelines• International Integrated Reporting Framework from theInternational Integrated Reporting Council• Sustainability Reporting Standards from the Global Reporting
Initiative (GRI)• ISO 26000, JIS Z 26000• Guidance for Collaborative Value Creation from the
Ministry of Economy, Trade and Industry of Japan
IssuedNovember 2023

2

BIPROGY is an acronym coined from the first letters of blue, indigo, purple, red, orange, green, and yellow, the seven colors visible when light isrefracted and reflected. BIPROGY illustrates a world where the colors oflight mix beyond any bounds. It also means that we will be a hands-on
company that combines light and makes the seven colors shine to illuminate new paths in a chaotic society by mixing the colors of light of various business partners and various individuals, and change the value we
provide in response to changes in society and environments, just as thecolors of light change in response to changes in circumstances.

BIPROGY Group Integrated Report 2023

85	Glossary

Notes Concerning Forward-Looking Statements
Statements in this report that refer to current plans, projections or
strategies of BIPROGY Inc. or its consolidated subsidiaries, other thanhistorical facts, represent forward-looking statements made basedon judgments and assumptions in accordance with the information
currently available. Please note that actual results may differ fromthe forecasts due to fluctuations in risks and uncertainties andchanges in economic conditions, and the Group makes no guaranteeof the reliability of such forecasts. This information is also subject tochange without notice. The purpose of this report is to provide information for use as a reference in making investment decisions, and it
has not been prepared to solicit investment. BIPROGY Inc. assumes
no liability for any damages resulting from the use of this report.
Description of Cover Visual［Fluid］
The cover depicts the shape of light bending and flowing at thehands of a gravity vector field created by the earth as it continues to move through space. The multicolored lines, which indicate the diverse collaboration and actions of people aiming tocreate a sustainable earth, are a symbol of diversity.

This report aims to communicate the BIPROGY Group’s medium- to long-term initiatives to improve corporate value to a wide range of stakeholders,
understanding of our process for creating both social and economic value.

The Integrated Report 2023 presents both financial and non-financial infor-

mation about matters of great importance in the Group’s value creation pro-cess. A broader range of detailed information is also available on our website.

Information DisclosureCorporate Data

https://www.biprogy.com/e/Company information/Solutions/Case studies
and more.

Information for Investors and Shareholders
https://www.biprogy.com/invest-e/

Integrated Reports/Financial Statements and Supplementary Materials/
Financial Results Briefing Materials/
Corporate Governance Reports and more.
Sustainability Information

https://www.biprogy.com/sustainability/ (Japanese only)

Sustainability Reports

and more.

BIPROGY Group Integrated Report 2023

3

Taking on the Challenge of Resolving Social Issues

At a Glance(Data as of FY2022 or March 31, 2023)

Year established1958

Locations

All over Japan and

8 foreign countries*

Consolidated
subsidiaries
1*1 America, China, Indonesia, Thailand, Singapore, the Philippines,
Malaysia, Vietnam

27

Composition of Revenue

 System services

100

Revenue¥115.7 billion

Number of customers*

5,000 companies
2

More than34%*2 Total of BIPROGY and UNIADEX

8,124

Revenue¥52.4 billion

No. of engineers

5,089

Services

No. of employees

15%

Hardware17%
11%

Others3%

System services
Revenue¥339.9 billion

Outsourcing

4¥29.7 billion
Basic earnings per share

ROE

BIPROGY Group Integrated Report 2023

3%

15%
Operating margin¥201.06

20%

Support services

20%

Operating profit

34%

8.7%

15.0%

Profit attributable toowners of parent¥20.2 billion
Issuer rating*3

A-

Product sales

Software Support services

0

11%

17%

 Outsourcing
Revenue¥66.7 billion

 Others
Revenue¥11.0 billion

 Software
Revenue¥37.4 billion

 Hardware
Revenue¥56.7 billion

Gross profit¥39.6 billion

Gross profit¥16.1 billion

Gross profit¥17.0 billion

Gross profit¥2.5 billion

Gross profit¥5.1 billion

Gross profit¥9.0 billion

Provision of consulting services for ICT strategies, software development contracting, andtechnology support services, etc.

Software and hardware maintenance/support services, installation assistance, etc.

Information system management contracting, services through cloud applications andservice-based/fee-based services, etc.

Communications network services, electricalinstallations, educational services, etc.

Sales of solutions developed in-house, provision of optimal software from vendor-freestandpoint

Sales of optimal equipment from vendor-freestandpoint*3 Rating & Investment Information (R&I)

BIPROGY Group Integrated Report 2023

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Taking on the Challenge of Resolving Social Issues

PurposeCreate a sustainable society using foresight and insight tounlock the full potential of technology.

Management Policies(2021-2023)
Targets to be achieved over three
years to realize Vision 2030

The BIPROGY Group aims to create a sustainable society by combining foresight and insight into

Expand the business ecosystemwith partners and communities

social change, technology centered on ICT, and the business ecosystem we have formed with various partners. We will not only provide ICT services, we will accelerate our efforts to create newvalue that enriches society and solve social issues, which we have promoted up to now, and transform ourselves into a company that creates social value.

P.28-35

Vision2030
Our Path to 2030

Principles

PurposePrinciples and Creeds

Principles•A cceptance and Acquisition of Diversity•T ransparent Corporate Activities and Healthy
Corporate Culture•S incere Performance

Creedswhich is a platform that helps create asociety where everyone can live happily

P.20-27

Create a sustainable society using

foresight and insight to unlock thefull potential of technology•S incere and Passionate Actions as a Good
Member of Society•P ursue High Quality, High Technology and
High‑level Skills•C reate Social Value and Achieve Sustained
GrowthCorporate Philosophy/
Charter of Corporate Behavior
Unchanging values and definitions

6

BIPROGY Group Integrated Report 2023

• Create schemes to solve issues through the useof digital technology and business ecosystems• Contribute to the environment through theuse of digital technology and reduce theenvironmental impact of business activities
in order to help build a world of net zero
emissions• Sustainably procure and provide safe, secure
products and services throughout the entire
value chain• Develop and strengthen human resources tocreate a new future and promote diversity
and inclusion•E fforts to Hand Down Well-being to the Next
Generation•C reate Value by Forming Business Ecosystems

Material Issues

Material Issues and Guiding Indicators

The Unique Characteristics and Management
Resolve of the BIPROGY Group•S
 ocial Inclusion and Respect for Human Rights•S elf-improvement and Greater Discretion

We will develop the Digital Commons

Foresight andInsight

Technology

Business
Ecosystem

Company that Creates
Social Value

Corporate Statement
Simple Slogans Spreading Ideas
Consistently“Foresight” consists of foreseeing andunderstanding industry changes, customer
needs, and future social issues, and “insight” has the double meaning of being able
to see and understand things combinedwith the meaning of “insight.”• Further improve corporate governance andintegrity
BIPROGY Group’s Digital Commons Concept

Digital Commons are communities where it
is possible to create both social and economic value in solving social issues by using
the power of digital technology to make itpossible to widely use privately owned
assets (assets owned by companies, organizations, and individuals) and surplus assets(assets with low utilization rates) that
already exist in society as shared assets withlow additional costs. Our Group will promote
the social implementation of the Digital
Commons by combining its track record andexpertise in solving social issues, its networkof like-minded people, and its digital technology based on many years of experience.

AmbitionEmpathy

BIPROGY Group Integrated Report 2023

7

Taking on the Challenge of Resolving Social Issues

CEO Message

Learning from experience to achieve a leap

forward, developing “Digital Commons” fora world that doesn't create social issues

Looking back on the second year of our Management Policies (2021–2023)
Solid progress in creating and expanding ourbusiness ecosystemtake on various challenges in areas that combine informa-(2021–2023) is now complete, and during FY2022, we could

Purpose, which we define as working to “create a sustain-

The second year covered by our Management Policies
sense the achievement of solid progress towards our

Vision-2030. We were able to properly respond to thegrowing customer demand for digital transformation (DX)services, as well as work actively to propose DX to our customers. In addition, we were able to sense a solid increasein the number of employees able to provide customers

lyst for the creation of business ecosystems that help customers address the challenges faced by society. We are

now regularly seeing such proposals lead to concrete business activity. Customers are increasingly recognizing ourGroup’s ability to engage in interesting projects, and this is
producing synergies. We are seeing a growing number ofissues that they face and also to serve as a partner in put-

One year has passed since April 2022, when we changed

Since then, we have created as many opportunities as pos-sions, we have identified the need to build world-leading

our company name from Nihon Unisys to BIPROGY Inc.

sible to explain the reason behind the name change to ourstakeholders, and the significance which the new nameholds for us. We have also engaged in deeper dialog with

our employees. Over that year, I think we have successfullycommunicated the role of our new name as a symbol of
our determination to address the challenges we face increating the world we wish to see.

However, over the past year, we have also had torespond to the loss of USB flash drives*, and I would like totake this opportunity to express my deepest apologies

once again for the worries and concern caused by this incident. Since the incident occurred, we have been working

as a Group to prevent any similar incidents from happening again. Across all of our workplaces and projects, wehave reconfirmed the importance of continually confirming the status of our information management systems.
Our executives and employees have also discussed

8

BIPROGY Group Integrated Report 2023

customers and wider society. As a result of those discus-

levels of security while building cooperative relationships

with our entire supply chain. However, this target is not ourultimate goal, and we will always continue aiming higher.
While continually reflecting on our journey so far, we willcontinually take on the challenge of adopting new technologies and frameworks. As this mindset has gradually

spread through our employees and partner companies, wehave started to receive words encouragement from ourcustomers. Shareholders, too, have passed on messages
to us such as “we hope you will continue to remain positive and seek to reach even greater heights.” We aim to

respond to these messages of support by showing themour commitment to “world-leading quality” is not simply aslogan, but something embodied in all of our actions.

* On June 21, 2022, a contract employee working at one of our partner companies
lost USB flash drives containing encrypted personal information, causing a major
information security incident (the memory stick was found three days later onJune 24, and no leak of personal information was confirmed).

significant forward progress in FY2022 in combining thethree areas of “foresight and insight,” “technology” and“business ecosystem.”Management Policies (2021-2023). To ensure that we

customers approach us. They seek our help to resolve therepeatedly what we need to do to regain the trust of ourpotential of technology.” We estimate that we achieved

only to meet the demands of our customers but also toadvertise ourselves as a company that can serve as a cata-Learning from major challenges; striving to reach new heights

able society using foresight and insight to unlock the full

Goals for the final year of our Management
Policies (2021-2023)

various challenges. Down the years, we have worked not

Representative Director,
President & CEO, CHO

and “real tech” and work towards the fulfillment of ouractivities, conducted together with our Group, to resolvewith proposals for the launch of new projects including

Akiyoshi Hiraokation technology and digital technology with “deep tech”

ting their business principles and corporate purpose into
practice.

Through start-up investment and corporate venture cap-

ital initiatives with a focus on open innovation, we increasingly engage in projects that allow us to combine our own
strengths and the strengths of these partners, producing
new markets and developing activities that create social

value. While our corporate group’s particular expertise liesin the fields of information and digital technology, we havealso been investing actively in entrepreneurs building

startups that develop “deep tech” or “real tech,” exchanging information with those companies. This allows us toFY2023 will be the final fiscal year covered by ourachieve significant progress during the period of our nextmanagement policies, we believe that we must strive overthat final year to invest actively in R&D and human capitalwhile also focusing our resources on DX, a field currently
enjoying significant growth, to build up the assets werequire for the future of our business. With that in mind,

we expect to achieve a sales revenue target of ¥350.0 bil-lion, up from the ¥340.0 billion target included in our original Management Policies. We are also changing the sales
revenue forecast for our outsourcing business from ouroriginal target of ¥100.0 billion to ¥75.0 billion and chang-

ing our forecast for adjusted operating margin from 10% orover to 9.1%. While this does represent a downward revi-sion of our targets for sales revenue from outsourcing solutions and adjusted operating margin, we are still

determined to eventually reach double digit profitability

and have not given up on this goal. Currently, it is important for us to achieve sufficient profitability and make themost of the favorable business environment, but we should
not reduce investment in the company’s future just for thesake of reaching an adjusted operating margin target.

Progress in the social implementation of the “Digital Commons”
In summer 2023, extremely hot days continued acrosswhich is why we have been providing various next-genera-

ifying for us once again the urgency of measures to miti-

ing number of companies are starting to appreciate theJapan with torrential rain frequently causing damage, clargate climate change. For many years, our Group hasrecognized the importance of efficient energy manage-

ment as part of our efforts to tackle the various environmental and social problems related to climate change,tion energy solutions and services. In recent years, a growvalue in this business, and we are increasingly working in

partnership with other companies to provide services thatprovide society with convenient supplies of green energy.
A further related issue is the growing demand for

BIPROGY Group Integrated Report 2023

9

Taking on the Challenge of Resolving Social Issues

CEO Message

corporate disclosure of carbon neutral related information.

and roads, helping to prevent and reduce damage fromday when customers tend to make purchases, providing

engage in various projects that combine assets alreadyeffect of disasters is not something that we can do by our-waste and distribution costs, while also improving produc-

natural disasters. However, mitigating and preventing the

To respond to these social demands, we are working toselves. By working together with diverse range of partners

developed by our Group with the assets of our customers

in different fields and different industries, we can expand

and partners. As we add new solutions to these projects, weare now entering a stage in which we can incorporate into

our social infrastructure the shared assets for efficient energy
management that we have already created by leveraging

business ecosystems and the power of digital technology.

Among the three beneficial social impacts that our corporategroup is trying to achieve, this will help us contribute to ourgoal of “zero emissions (environmental contributions andreduced environmental loads using digital technologies).”

Another one of our desired social impacts is to help soci-ety achieve “resilience through viable and resilient autonomous distributed environments,” creating a society that is

assets that can be shared by society). A large number ofour employees now share this vision, and we can feel our-ture and various other facilities, Japan is facing the issuesof insufficient labor and the growing average age of technical experts. To address these issues, our Group is starting

shape. Moving forward, we aim to apply these frameworks

shortages in the retail and service businesses and the

problems of excess waste and the production of marine

plastic waste. When addressing social issues, it is importthis area include AI-supported automatic ordering systems
to control product orders, and the introduction of systems
replacing electronic product price tags to greatly improve

ing*. Our customers in the retail industry have received

these initiatives positively. We can also harness all the data
to identify strong-selling products and analyze the time of

Aiming to achieve sustainable increases in corporate value by providing solutions to the business and social problems faced by our customers

Achieving a decarbonized society

Environmental
value

Services for managing
environmental value(Re:lvis)

Smart oasis
Enability Series (EV charging)

BankVision on Azure

Financial service
platforms

Added valuebanking

SmileBranch

OptBAE

Platform harnessing
financial and regional
data (DataLake)

Revitalizing regional economies

10

BIPROGY Group Integrated Report 2023

Community
microgrids

Infrastructure forcommunity recycling

Non-fossil fuel energy
certificates (tracking
attributional information)

EmbeddedfinanceWe believe that the concept of “Digital Commons,” which

are to raise the social position of our Group and grow overthe next 5, 10, or even 20 years, while harnessing theadvantages and originality our Group has acquired down

Commons.” By 2030, we will hopefully be able to see theplace by other companies, as a base to respond to future

be used to resolve various social issues, or prevent suchthe years, in addition to the pioneering initiatives put intochanges in the social environment and new paradigms. As
we move towards 2030, we aim to make firm progress indeveloping these frameworks, which will allow us to movetowards the creation of a world based around the “Digital

Regenerative

Smart mobility/
housing

Mobility-related
services
Automatic driving
simulations
Smart oasis(car sharing)Cashless payments

For Customers
Promote DX for customers
For Society
Promote DX for society

Resilience

AI-Order Foresight
CoreCenter

Supporting “online
merges with offline”(OMO) services

Automation ofmanual workattended on each occasion by several hundred people.

reuse those attempts at some point in the future. Recently,
as our “holding tank” is stored in the cloud, maintaining
this information requires little operational cost. In addi-tion, since no major investment is required for us to reusepreviously tried services, we can build models with themarginal cost of zero, which is a major characteristic ofdigital technology. Assets we created through projects that

customers and partners with solutions.

Our employees also work to learn about corporate-

Next generation
retail services

Transforming supply chains

rently feel great potential in pursuing this approach.

failures than successes, but by recording our failures in a

future remains unpredictable, we are likely to see more

database of prior businesses and assets to provide ourTransforming
distribution

slogan of “Digital Commons Can Save the World,” we cur-the early morning to exchange information in a study

other new projects. Furthermore, we can also use our

DIGITAL’ATELIER

issues from emerging in the first place. Under the grandAs we work to produce various services at a time when the

did not work out initially are already proving useful in

DX in advanced
manufacturing

Housing DX

path towards a world in which the “Digital Commons” canCreating connections between organizations via information sharing

database used as a “holding tank,” we may be able to

Expanding business ecosystems

Zero emissions* Pricing method in which businesses set flexible prices for products and services
taking into account supply and demand.

we outline in our Vision-2030, is a strategic necessity if weof social issues, this category includes issues such as labor

hand. These later systems can also support dynamic pric-in productivity, efficiency, and personnel reductions. We

supply chains that have a low environmental impact.

“Regenerative systems for a net positive society.” In terms

reflect discounts, a task that was previously carried out by

using IoT-enabled devices and AI to enable improvements

first steps towards achieving profitability while building

Contributing to the elimination of social problems

The final one of our desired social impacts is to createtask efficiency when changing price labels, for example toto create frameworks that support technical experts bytion control. These new systems help customers take theselves making strong progress.

sumption, and distribution. Solutions we can provide inmanaging, maintaining, and inspecting social infrastruc-beyond the current scope of buildings, tunnels, bridges,

tion and reduction, creating “Digital Commons” (digital

ant to achieve a good balance between production, con-robust in the face of crises. For example, in the fields ofare now seeing the results of these projects begin to takeour business ecosystems, contributing to disaster preven-this information to parties in the supply chain to reduce

backed startups and venture companies by gathering inmeeting that we call the “Morning Challenge,” which isThrough these initiatives, we work to encourage the sharing of information. These activities, many of whom arealready under way, also help break down silos between
different parts of our organization and encourage new

projects based on cross-departmental coordination. For
example, our new service for supporting the acquisition
and management of non-fossil fuel energy certificatesgrew from coordination between the team responsible forenergy management and the team responsible for financial technology. These projects evolved spontaneously

from employees communicating with each other in theworkplace and serve as examples of behavioral change
sparked by information sharing.

Fostering the development of employees who can work independently
When it comes to work, companies frequently talk about“musts,” but if employees are told that persisting is a“must,” they may feel discouraged. That is why, if we are toincrease the number of motivated employees who can act

BIPROGY Group Integrated Report 2023

11

Taking on the Challenge of Resolving Social Issues

CEO Message

Evolving our organization and our people while
promote intrapersonal diversity through the
ROLES System

expanding the scope of ROLES, we can improve thehours and use that time for the self-development of their

At BIPROGY, we also provide many opportunities fortice at an organizational level, the organization itself canhuman resources systems. We use “ROLES” in the plural toprojects and the “Morning Challenge,” both mentioned

ROLES is the concept that lies at the heart of the BIPROGY

learning. In addition to our “holding tank” database of pastemphasize the diversity of the roles to each individual is

above, we encourage employees to engage in T3 (Time torequired to play. When a single individual performs a variety of roles, they can develop variety of different perspec-tives. When people can see things from other perspectives,
it is easier for them to understand and respect others who
have different values.

Then, when people with different values are able tointeract, they may produce products and services that areeven more appealing. This is why the concept of “intrapersonal diversity” is so important for us.

on their own initiative, we must transform “musts” into

For example, if an engineer, whose previous project“wants” and “hopes.” To take a step in that direction, we

took advantage of the coronavirus pandemic to promote

experience has been to ensure the thorough implementa-

One reason why we call our Management Plans ourof a new business, they will be able to appreciate just howtion of quality, cost, and delivery, is involved in the launchself-motivated workstyles, unrestricted by time or place.

difficult it is to get a new business up, running and gener-“Management Policies” is that when building specific sys-ating profit. By using the concept of ROLES to let each indi-tems and frameworks for concrete tasks, we encourage

each employee to go about the task in their own way. At
the collective name of the Group Design Division , since wetheir self-directed career development, but as we movedirected employees.

As we reach the final fiscal year covered by the current

Management Policies (2021-2023), we are working to draw
up our next Management Policies. While we have not yet

forward we hope to expand the application of the ROLES

concept to job rotation and recruitment. By systematically ach individual employee can interact with ROLES in various ways including “sequentially taking on different roles in the course ofE
their career,” “simultaneously taking on different roles,” and “taking on new roles in areas where they lack experience.” By understanding and committing to the requirements of the roles that they have experienced in the past and the roles they are currently undertaking, employees can improve their intrapersonal diversity.
Past

ROLES

12

Present

A

Future

ROLES

A

ROLES

B

BIPROGY Group Integrated Report 2023

Accumulating experience through multiple
roles leads to improved intrapersonal diversity

ROLES

B

ROLES

C

ROLES

B

ROLES

A

ROLES

C

we can foster the development of diverse individuals who

can produce innovation, and this learning can continue tomake our organization even stronger.

taking on the challenge of inorganic growth, while accepting a certain degree of failure.

Through various open innovation initiatives, we candriving forward towards the achievement of Vision-2030.

Group’s expertise in quality management, we are able to

the Policies will be based around our business strategy of
For our next Policies, I plan to have Group members whorather than have specific policies dictated to them by me.
company that employees have set up on their own initia-

tive. If these self-directed task forces ask me for advice, I do
not do much beyond provide suggestions on areas they

venture capital and creating synergies. By using ourelevate the advanced business models and technology

developed by startups to the levels required to meet thedemands of customers in Japan. We aim to further

strengthen our involvement in open innovation, combining information and digital technology with “deep tech”
and “real tech” to produce new value for society.

We have worked, through the construction of businesscould look into, avoiding explicit instruction. All of ourecosystems that can address social problems that are diffi-

self-motivated thought and action, and I believe that wevarious issues through innovation and new services. As we

employees are already capable of a considerable degree of
have reached a stage where it is inappropriate for the comof past success. Among the employees launching their

 T BIPROGY, ROLES refer to the roles employees perform when completing their tasks. Roles are defined in terms of the competenciesAand skills required to complete a particular job. It is a core concept that helps clarify the type, quality and number of personnel
required to implement the various business strategies under the overall management strategy.

adoption of ROLES, and self-learning as an organization,

make progress in harnessing the power of startups andpany President to intervene directly based on experience
What are ROLES?

learn. Once we can encourage self-directed work, thedetermined how many years the next Policies will cover,

Currently, we already have a number of taskforces in the

project assignments, and to support our employees inthese efforts are for the purpose of developing, self-“wants” and “hopes.” If this concept can be put into prac-

Accelerating forward towards the achievement of Vision-2030 under ourManagement Policies for the years aheadachieve and how they can help move the project forward.
already use ROLES to plan our organizational training,

and influence (“design”) the direction of our Group. All ofaway from their current main task for three consecutive

wish to think about our future build the policy themselves

This results in significant personal development. We

want to harness the know-how of each individual to shape

Think) activities, which require them, once a week, to step

vidual take on different responsibilities, we can raise

employee’s awareness of what the project is trying to

BIPROGY, we also refer to our management divisions byintrapersonal diversity of our employees.

own task forces to debate these issues, a number havealready taken our “Management Leader Program” which isdesigned to help foster candidates for future executive

positions. Some participants in these self-directed task

forces are in their 30s. I am very much looking forward toseeing the business strategy visions that emerge fromthese initiatives.

Taking on the Challenge of Inorganic Growthcult for our corporate group to tackle alone, to address

move forward, our intention is to further expand our scopeand our assets through methods including merger andacquisition. While our Group has significant expertise inhelping customer companies transition and improve theiroperations using information and digital technology, andthen operating and maintaining those systems, the opera-

tional technology (OT) required to operate such systems isa missing piece of our puzzle. As we move towards

Vision-2030 with the aim of creating further significant

social value, it is increasingly important for us to continue
revising and improving our business portfolio.

We move towards the achievement of our Vision 2030

Up until now, we are focused on improving our businessfeeling pride in keeping in mind our corporate statement

existing assets. That is because our primary goal was tonies and organizations to develop new business ecosys-

performance through organic growth that builds upon our
generate profits, increase our cash flow, and strengthen

our financial position. However, I believe that stage of ourcompany’s history is now complete. Our efforts so far have“foresight in sight,” working together with various compatems, and contributing to the creation of a sustainable
society, with a firm insight into the future.

provided us with the financial leeway to make various

investments, and we have in place a solid platform for
BIPROGY Group Integrated Report 2023

13

Taking on the Challenge of Resolving Social Issues

Transformation from Nihon Unisys to BIPROGY
Contributing to the expansion of customers’ businesses and structuralreforms through the formation of Japan’s informationsociety and construction of various systems
commercial computers, the BIPROGY Group has contrib-

Identifying the demands of various customers, we con-tinue to meet needs regardless of the age through our pro500000

vision of business solutions that support industry.

Changes in portfolio Maintenance services
and software, etc.
 Sales of computer(hardware) Rental for computer(hardware)
Net sales

customers and partners in various industries who possess

diverse strengths, we will develop those into a digital com-

34%

FY1988*2022
Corporate name changed to BIPROGY Inc.

field over the years to form business ecosystems that link

Services sales

uted to the formation and development of Japan’s domesand building systems that support society and industry.

Using the experience and track record built up in the ICT

1988
Nihon Unisys, Ltd. foundedOver more than sixty years since providing Japan’s firsttic information service industry by offering ICT systems

Transforming into a company that creates social value by building
business ecosystems that solve social issues
Services revenuemons—that is, shared assets of society, a system that promotes the creation of a society in which everyone can live

FY2022happily. We aim to build a unique corporate brand in theindustry through BIPROGY, the new company name, andtransform the Company into one that creates social value
by working to solve social issues with borderless ideas.

¥279.6 billion
Operating income ¥17.6 billion

72%¥339.9 billion¥29.7 billion

Revenue  System services
 Support services
 Outsourcing
 Others
 Software Hardware

Operating profit* Breakdown rations apply to Nihon Unisys
non-consolidated

 Revenue (Net sales)
Operating profit (Operating income)0 1947

1965

1940〜1950

1947

Yoshizawa Kiki, the predecessor to Nippon Remington
Univac Kaisha, Ltd.,established1955◆ Installed Japan’s first commercial computers at Tokyo
Stock Exchange, Inc. andNomura Securities Co., Ltd.

1960
1967

◆ Launched Japan’s first
online banking process

1968◆ Nippon Remington
Univac Kaisha, Ltd.
changed its corporatename to Nippon Univac
Kaisha, Ltd.

1970

1975

1980

1970

1971

◆ Nippon Univac Kaisha,Ltd. listed on the firstsection of the Tokyo
Stock Exchange

1977◆ Launched FAST software
for financial institutions

1985

1980

1988

◆ Establishment of
Nihon Unisys, Ltd.
Merger of Nippon Univac
Kaisha, Ltd. andBurroughs Corporation

1990

1995

1990

• Japan’s bubble• Financial
economy collapses crisis

1991◆ Launched the integrated
CAD/CAM system CADCEUS

1997◆ Total infrastructure service
subsidiary UNIADEX, Ltd.
established

1958

2000

• Dot-com bubble collapses

2007• Global financial crisis◆ Started providing the smart oasis charging infrastructure system for electric vehicles

2015

2020

2010

◆ Capital alliance with Dai Nippon Printing Co.,
Ltd. to strengthen business foundation for
expansion in new markets

2013◆ Started providing Zero-Accident Program DR service to help reduce automobile accidents andpromote safe and energy-efficient driving◆ Began operation of the world’s first open
technology-based domestic airline passenger
system2017◆ Canal Ventures, Ltd., a venture capital company, established◆ Start of Resonatex open API platform service

2017-2018◆ Established Canal Payment Service, Ltd., apayment- and settlement-related businesssubsidiary, and formed a business and capitalalliance with JCB Co., Ltd. and CARDNET◆ Capital alliance◆ BusinessGreater business efficiency and cost reduction
Mainframes

BIPROGY Group Integrated Report 2023

Clientservers

Support for management decision
making and business expansion
Solutions

Mobileservices	Support for structuralreformERP
packages

Business innovation/ business creation
Cloud
computing

Big data

2022• COVID-19 pandemic

2012

2009

Nippon Remington
Univac Kaisha, Ltd (currently BIPROGY Inc.)

14

2010

◆ Introduced core-banking system BankVision, theworld’s first“full-banking” system based on the
Windows platform◆ Founding

Value and Functions
Required of ICT

2005

2000

2020

2022

◆ Corporate name changed to
BIPROGY Inc.
2020

◆ Established Emellience Partners Inc. for co-creative
business generation◆ Launch of AI-Order Foresight, a cloud-based automatic order service based on AI demand forecasts

2021◆ Established Green Digital & Innovation Inc.
◆ L aunched Japan’s first public cloud full banking system2022◆ Established V-Drive Technologies Inc., which undertakes automated driving system development andsimulation◆ Launched Omni-Base for DIGITAL’ ATELIER, a service-use type commerce business platform

Resolution of social issues
IoTAI
robotics

Smarttechnology

Digitaltransformation

BIPROGY Group Integrated Report 2023

15

Strategies Aimed at Realizing Vision 2030

Value Creation Process

PurposeP.6-7

By expanding business ecosystems that span

Create a sustainableinsight to unlock theForesight and insight x Technology x

across sectors and business models and leveraging its accumulated strengths to solve the social
issues, the BIPROGY Group aims to create a sus-

Use “insight” notunderstanding of issues

tainable society through the creation of socialand economic value.

StrategyManagement Policies(2021-2023)
P.28-35

Inputs

BIPROGY Group will achieve the
Vision 2030 plan by pursuing di­gital transformation (DX) for bothcustomers and society, develo­
ping its business through a large
framework that encompasses allof society, and working withpartners and the community to
expand business ecosystems.

Sources of Competitive Advantages

Material Issues
P.20-27

Promote initiatives
to achieve Vision2030

society using foresight andfull potential of technology• Create schemes to solve issues through the useof digital technology and business ecosystems• Contribute to the environment through the useof digital technology and reduce the environmental impact of business activities in order tohelp build a world of net zero emissions• Sustainably procure and provide safe, secure
products and services throughout the entire
value chain• Develop and strengthen human resources to create a new future and promote diversity andinclusion• Further improve corporate governance and integrity

Human capital P.18

 uman resources able to take the initiative to grasp socialH
issues and take actionCorporate culture that boasts diversity and encourages taking
on challenges- No. of employees: 8,124- Percentage of management positions held by women: 9.3%
- No. of engineers: 5,089

Relationships
with customers and partners invarious
Industries

 financial base supporting new service creation and respondAing to business environment changes- Equity attributable to owners of parent: ¥139.9 billion- Free cash flows: ¥12.9 billion

Capabilities
for enabling
successful
systemimplementation



Financial capital Intellectual capital  usiness knowledge from various industries and technicalBskills cultivated over a history of more than 60 years
Open innovation through collaboration with venture firms andstartups
Services that promote the business ecosystem
Investments to create new services- Obtained DX Certification- Investments*1: ¥22.1 billion







Natural capital Decarbonizing business activities- Amount of energy consumption: 7,608kl- Percentage of purchased electricity derived from renewableenergy sources: 23.4%
Manufactured capital  uality assurance for products and services
QTransparent and fair processes
Nationwide service network in Japan, service locations ineight foreign countries- Quality control via ISBP*2- Group compliance awareness survey response rate: 95.6% /97.4％


Capabilities
for enabling
one-stop vendor-free
supportCapabilities
for designingand delivering newservices*1 Total of R&D expenses, capital expenditures and strategic investments*2 ISBP (Information Services Business Process): The Group’s standard business process, summarizing the work required for system development in order to provide high-quality systems.

16

BIPROGY Group Integrated Report 2023

Providing services
contributing to corporate DX

Strengths

Providing services that contribute to
the efficiency and evolution of
corporate operations

We will develop the Digital
Commons which is a platformthat helps create a society where
everyone can live happily.

restrained by experience and conventional knowledge and gain a deep
faced by society and customers quickly ascertained through “foresight”

Social and relationship capital  ustomer base spanning a broad range of sectors andCindustries
Relationship with customers and partners- Customers: More than 5,000 companies- BIPROGY Users Association members: About 540 companies- Development partners: More than 450 companies

P.20-27

Business ecosystem = Company that creates social value

BIPROGY Group’s Businesses

Data as of FY2022 or March 31, 2023

Vision2030

Resilience

Viable and resilient autonomous distributed environments
Regenerative systems for a net positive society

Transportation/Mobility

Zero emissions

Environmental contributions and reduced
environmental loads using digital technologies

Healthcare/Education

Outcomes

Social implementationof services that solve
social issues

Social and Economic Value Created

Work/Life

Data as of FY2022 or March 31, 2023

Social and relationship capital Contribute to the sustainability of society by providing businesses that solve social issues
Create business ecosystems by building relationships of trust with diverse stakeholders
Provide safe and secure products and services- Number of businesses that solve the issues faced bysociety and consider optimization for society and theworld: 125.5% compared to FY2020


Digital Security

Green Energy

For Society
Promote DX for society

For Customers
Promote DX for customers

Regenerative

Combine businessassets across markets



Human capital Produce innovative human resources that contribute to solving social issues
Improve labor productivity- Number of business producers: 37- Weighted average score of work style related items in
the engagement survey: 3.47
- Operating profit per employee: ¥3.65 million
Financial capital High capital efficiency and firm financial foundation- ROE: 15.0%- Issuer rating*3: A- Ratio of equity attributable to owners of parent tototal assets: 49.9%
Provide system integration services

The Group’s core business that provides solutions and services
that are the most appropriate for customers, which includes
building, operating, and maintaining information systems
Outputs

Build business ecosystems for coexistence and co-prosperity that transcend businesstype and industry and contribute to solving social issues through partnerships withmultiple companies and organizations and each partner’s technology and strength

Creation of Services

P.76-78

Revenue¥339.9 billion

Promote business ecosystems

FY2022Services revenue

72%

 System services Support servicesO utsourcing Others
 Software Hardware

Intellectual capital Creation of new services- Investments in businesses such as start-ups: 71- Investments in funds that target diverse fields bothin Japan and overseas: 31Natural capital 

34%
15%
20%
3%
11%
17%

Provide environmental contribution services
Reduce the environmental burden of the valuechain- Percentage achieved for target contribution to corporate net-zero emissions through customer use of environmentally friendly products and services: 174.6%- Reduction rate of GHG emissions (Scope 1 + Scope 2(Market-based), vs. FY2019): 25.1%
(Negative output)
GHG emissions (Scope 1 + Scope 2 (Market-based))
10,753t-CO2e

Manufactured capital Reliable operation of services- Online uptime rate: 99.998%

Foundation for promoting business activities

Changes in society

P.22

P.48-75*3 R ating & Investment Information (R&I)

BIPROGY Group Integrated Report 2023

17

Strategies Aimed at Realizing Vision 2030

Source of the BIPROGY Group’s Value Creation
BIPROGY Group’s Strengths—Implementation Capabilities Backed by Integrity, the Power to Get Things Done
Relationships with Customers and Partners in Various Industries

Customer base in a wide range of fields

Number of customers*1

more than

5,000 companies*1 Total for BIPROGY and UNIADEX

Breakdown of sales by market (FY2022)
Financial services

Banks, shinkin banks,
cooperative central
financial institutions,securities, insurance,
etc.

Manufacturing

Public/government

Government offices,
local governments,
related organizations, schools andnursery schools,
healthcare, etc.

Utilities/Services/Other

Retail, wholesale,mail order,
apparel, distribution, trading
companies, etc.

Electricity and gas,
information and communications, transport, services, realestate, travel, leasing
companies, etc.

Engineers backing our technological capabilities

Extensive

track record

System service engineers, etc.

System engineers

Engineers

5,089

Total 8,124
Staff

Sales

Capabilities for Enabling One-stop Vendor-Free Support

One-stop
services

Development partners
More thanIdentificationand sharingof management issues

450 companies

Upstream
proposals(Management
issues, business reform
measures)

Locations Japan

Nationwide network

Overseas

8 countries*2*2 (As of March 31, 2023) U.S., China, Indonesia, Thailand, Singapore, the Philippines, Malaysia,
VietnamBusiness
consulting

CustomersIT
consulting

SystemdesignSystembuilding

Systeminstallation

Operation
andmaintenance

Solve management
issues

Shift to newissuesCapabilities for Designing and Delivering New Services

In order to solve various issues for companies and society, we are aggressively investing with a focus on open innovation and developing human resources capable of designing new services.

Total investments*3(FY2022)¥22.1 billion

Other investments in humancapital ¥2.6 billion*3 Total of R&D expenses, capital
expenditures, and strategic
investments

18

Examples of new services(FY2022)


DIVP*4, safety evaluation infrastructure for automated driving
PRAISE CARD, an application service that helps improve engagement by creating a success cycle
for the organization through praise*4 Driving Intelligence Validation Platform

BIPROGY Group Integrated Report 2023

Initiatives to create innovation
Human
Resource
Strategy

Investment
Strategy he Group strategically promotes the development ofThuman resources who possess the capability to create
greater value by involving in-house and outside humanresources.

 he BIPROGY Group is continuing and expanding investT
ments in and M&As with partners with cutting-edge
technologies and expertise, including globally, as wellas investments in startups and funds.
The BIPROGY Group is enhancing its R&D capabilities in
cutting-edge technologies, and accelerating open innovation with the objective of creating new services.

work to expand our business ecosystems in collaboration
tion of social issues by combining services and value cre-ated in diverse industries, sectors, and markets across theboard.

Business ecosystems, collaboration that transcends industry boundaries to realize solutions to social issues
We live in an era in which ICT has improved operational efficiency and resulted in new businesses and lifestyles, and technology is transforming business models and removing thebarriers between industries. In this era of previously unimaginable new services, such as self-driving cars and drone delivery, which are transforming various aspects of society,including the legal system, it is necessary to focus on social
issues with foresight and insight and foresee new business
opportunities.
To create businesses that solve the social issues, it is necessary to create alliances that transcend business type orindustry.
The BIPROGY Group, the core of the business ecosystem,
creates innovative services.

Consumers

Financialservices

Advertising
media

Manufacturing

Distribution
Public sector
Local
governments

BIPROGY Group

Education
institutions

Retailers
Softwaredevelopers

Hardwarevendors

Services

NPOs

Value creation cycle that accelerates thebusiness ecosystemservice contexts that are appealing to customers by gener-

industries to solve their issues, which has made it possible

compiling that into a library. Winning the trust of custom-

The Group has earnestly collaborated with customers in all

We provide an optimal ICT environment to solve our customers’ issues by providing one-stop support capabilities from a vendor-freestand-point that is not limited to our own hardware or software.

Various
manufacturers’
productswith customers and partners and contribute to the solu-

acquired through that core business to support DX so that

We are involved in everything from development to post-completion evaluation and improvement, and contribute to the solution ofcustomers’ management issues through our solid knowledge and technical capabilities.
Composition of Employees(as of March 31, 2023)

system integration services that contribute to greater effi-core business, we leverage the experience and knowledge

Capabilities for Enabling Successful System Implementation

Providing mission criticalsystems that move society

customers can generate greater growth. In addition, we

ciency and sophistication of customers’ operations as ourCommerce/Distribution

Automobiles,
printing, housing, precision
instruments,
food, pharmaceuticals, etc.

The Group has won the trust of customers by providing ICT
infrastructure and system services over many years. With

With a broad customer base in the financial, manufacturing, distribution, government, and public sectors, we provide IT solutions
based on IT strategy consulting, as well as integrated services as far as operation management and maintenance support.

Customers in broad types andcategories of businesses

BIPROGY Group’s Businesses

for us to accumulate experience and knowledge based on
our familiarity with their operations. By stitching together
in a patchwork fashion various assets such as the knowledge we have acquired working with customers and theassets obtained through the solutions we have inde-

pendently developed, open innovation, the pursuit ofknowledge and other companies’ products, and by

reworking these assets into an optimal form while obtain-

ing additional wisdom from our customers, we will work toenrich our unique, flexible business platform layer. At thesame time, we would like to increase, in the long term,
Value Creation Cycle
Increase both the network effect andcustomers with shared aspiration

alizing the experience and knowledge from individual projects into a form applicable to multiple customers anders accelerates the business ecosystem and gives birth tonew practices between customers in new businesses. As

trust from society and network effects within business ecosystems increase, more customers share our ambitions,which leads to the resolution of a larger number of issues
faced by society. We are aiming to transform into a company that creates social value by implementing a value

creation cycle that accelerates business ecosystems basedon the Group’s foresight and insight and implementation
capabilities backed by integrity, the power to get things
done.

Obtain assets through various activities,
such as daily activities with customers

Enrich business platform layer

Implementation Capabilities Backed byIntegrity, the Power to Get Things Done

Win the trust of customers as abusiness partner

Expand service context

Business platform: platform that combines operation processes and systems, SaaS, BPO, and similar elements
Service context: service scenario and business model whose hypothesis has been verified

BIPROGY Group Integrated Report 2023

19

Strategies Aimed at Realizing Vision 2030

Vision 2030
The BIPROGY Group combines its foresight and insight into

power of digital, used to make private assets that alreadyness ecosystem we have formed with various partners toand individuals) and surplus assets (assets with a low

Vision 2030

creates social value. Based on this adopted “Purpose” ofmutually related social impacts as guideposts: “resilience (via-view to the year 2030. This is our “Vision 2030.”“regenerative (regenerative systems for a net positive society),”

Viable and resilient autonomous

Zero emissions

Environmental contributions
loads using digital technologies

reduced environmental loads using digital technologies).”

Together with our partners in our business ecosystem, we aimof social value and economic value in the resolution of

to create value and originate markets.

social issues. These communities are formed thanks to theMaterial issues forachieving businessgrowthMaterial issues forsupporting businessgrowthMaterial Issues











Create schemes to solve issues through the use of digital technology and business ecosystemsC ontribute to the environment through the use of digital technology and reduce the environmental impact of business activities in order to help build a world of net zero emissions
 ustainably procure and provide safe, secure products and services throughoutSthe entire value chain
 evelop and strengthen human resources to create a new future and promoteDdiversity and inclusion
Further improve corporate governance and integrity

In order to integrate the Group’s sustainability initiatives

material issues, and are currently promoting associatedextracted key issues that we need to tackle going forward.

and targets, we have also introduced restricted stock

initiatives. Additionally, with a view to realizing those KPI

into its management to achieve Vision 2030, we have

Work/Life

remuneration linked to medium- and long-term perfor-

Moreover, we have established material issues that corre-

mance, including the achievement of material issues, inspond to key issues with an especially high degree of

Digital Security

Healthcare/Education

and “zero emissions (environmental contributions and“Digital Commons,” which we have espoused as part of“Vision 2023,” refers to communities that enable a balanceMaterial Issues to Address in Order to Realize Vision 2030

and reduced environmental

distributed environments

ble and resilient autonomous distributed environments),”

ours, we have set forth the direction we must take with aClassification of Material Issues

positive society

Under “Vision 2030,” we will promote business with three

and resolving social issues and to become a company that

where everyone can live happily.

Regenerative systems for a net

additional costs.

its initiatives for creating new value that enriches society

which is a platform that helps create a society

Resilience

operation rate) widely usable as common assets with low

not only provide ICT services, but also to further accelerate

We will develop the Digital Commons

Regenerative

exist in society (assets held by companies, organizationssocial change, technology centered on ICT, and the busi-

our director remuneration system.

impact and set KPI and targets relative to each of those
Process of Determining and Updating Material Issues

20

BIPROGY Group Integrated Report 2023

6A
 scertainment of2
stakeholder requests
 ssessment ofA3
impact4

I dentification ofmaterial issues

5 etting of KPI andS
targets

3 Assessment of impact
Large

Impact on our stakeholders

Digital Commons

Green Energy

Revised on annual basis

Transportation/Mobility

 xtraction of key
E
1
items

Items enclosed in a blue box were revised in FY2023.

Items in red border were extracted as material issues.

4
2

3

1

2

1

3

2

1
5

3

1 Climate change

S (Social)

2 Water resources

3 Biodiversity

1 Acquisition and promotion of diverse human resources

4

2 Human resource development
3 Supply chain management
5 Human rights*

G (Governance)

6 Labor4 Customer service

1 Corporate governance

6

Impact on the BIPROGY Group(risks and opportunities)

E (Environment)

Large

Risk management
Compliance Intellectual property protection
2 Innovation management
3 Information security and protection of personal information
4 Preventing corruption and bribery* Includes the concepts of protecting privacy and guaranteeing the freedom of expression.

BIPROGY Group Integrated Report 2023

21

Strategies Aimed at Realizing Vision 2030

Vision 2030

Key Items that We Extracted in Determining Our Material Issues (Items with a grey background were extracted as material issues)
1 Climate change
2 Water resources
3 Biodiversity

Main changes in society we are aware ofBusiness and Other Risks

Threats

Rapid shift to adigital society

Acceleration of
DigitalTransformation

Business EnvironmentSociety 5.0: A
Super-Smart
Society*Impact of economic
trends and the market
environment







Procurement







Intellectual property
rightsExpectation ofresolving social
issues throughbusiness
Spread of ESG
andSustainability

Project management











Business Activities

Changes in
expectations
and demands ofcompanies
regardingcreating asustainable
society

System failureInformation security orsening economic environment due to factors such as changes
Win circumstances surrounding COVID-19, intensified tensions
between the US and China and the situation in Ukraine
Worsening business environment due to factors such as restraints
on investment in information systems and changes in that investment strategy by companies as well as intensified competition
caused by new players from other industries
Growing environmental awareness and rapid changes in social
consciousness, such as climate change countermeasures amid
the spread of ESG, and the strengthening of global environmental
regulations in response to the growth and changes 1
Changes in various government policies, such as disastercountermeasuresI mpact on the purchase of the Group’s products due to changes inthe business strategy of or deterioration in management at suppliers 3
Occurrence of serious failures due to service malfunctions, security incidents, etc. 3
Declining social credibility and brand image

Infringement of intellectual property rights by third parties 1
E xpenses associated with disputes over intellectual property rights 1
Possibility of not being able to obtain necessary licenses and nolonger being able to provide certain products and services 1
Not being able to use the expected intellectual property frompartner companies despite tie-ups 1

 eaks of confidential customer information or personal informaLtion 3
Cyberattacks 3Declining social credibility and brand image
Incurring of response costs























Human resourcesI ntensifying competition for IT personnel 1
Securing human resources with technical capabilities, the ability
to continuously innovate and adapt to diversifying social issues
and customer needs 1 2







Investment

Intensifying
competition due
to entrants fromother industries







Compliance

OthersBusiness
environment inwhich it isdifficult topredict the
futureIncreased
uncertainties

Natural disasters,
infectious diseases,
and other events











I nsufficient return on investment
Inconsistency with business partners’ management strategies
Business growth below initial expectations
 ersonnel and labor issues 5 6 1 4POccurrence of inadequate data handling and other serious compliance violations 1 3D ecline in social credibility, payment of compensation for resulting damages,
and reexamination of business dealings by key suppliers and customers
 atastrophic damage from natural disasters, such as earthquakes,
Cor terrorism
Restrictions on providing services or other business activities due
to an outbreak of infectious disease, etc.
Threats to the health and safety of employees

diverse human resources uman resource development
2 H
3 Supply chain management

Opportunities


Delay
in deliveries and cost overruns due to increasing complexityof customer requirements and project complexity
Increased safety and security risks due to diversification of products and services 3
 erious failures due to system malfunctions, cyberattacks, orSother problems 3
Declining social credibility and brand image
Compensation for damages

 cquisition and promotion of
1 A












 reate business opportunities that contribC
ute to the solution of issues faced by society
and capture profits in created markets 2
Create business ecosystems and expand
business opportunities by establishing trustwith a wide range of stakeholders 2

I ncrease profit opportunities by strengthening trust with suppliers and capturing quality
partner companies and thus reinforcing relationship capital 3 4
Reduce business risks related to issues suchas human rights and environmental burden
throughout the value chain 3 4

4 Customer

service
5 Human rights
6 Labor ecure a stable revenue base as productivity
S
increases and cost overruns decreaseIncrease profit opportunities by strengthening trust with customers/suppliers 4
Provide secure services and platforms tocustomers 3

Expand business by generating innovation 2C ontribute to the creation of employment opportunities for diverse human resources 1 2Contribute to the creation of a society that is
physically and mentally healthy, is acceptingof individual diversity, and offers work satisfaction 1 2 6
Provide high-value-added services thatmake use of advanced skills
Ensure competitive advantages
 xpand business by generating innovation 2
E
Develop high-value-added human resources withthe ability to assess where and how much to invest
Increase return on investment
Ensure competitive advantages
I mprove social credibility
Contribute to the solution of issues faced bysociety and the economic growth of society
through transparent and fair processes

 ontribute to society’s sustainability by proC
viding businesses that solve the issues facedby society 1 2 3

G (Governance) 1 Corporate governanceRisk management
ComplianceIntellectual property protection

2 Innovation management

3 Information security and pro-tection of personal information

 reventing corruption and bribery
4 P

Material Issues

Company’s Ideals and Goals

 reate schemes to solve issuesCthrough the use of digital technology and business ecosystems

We will help to build a regenerative,
resilient society of net zero emissions by creating communities withcustomers and partner companies
in a wide range of industries whoshare our ambition.

Related key items

1 1 2 4 1 2
Contribute to the environment
through the use of digital technology and reduce the environmental impact of businessactivities in order to help build aworld of net zero emissions
Related key items

I ncrease profit opportunities by capturing
quality partner companies
Improve social credibility
Expand business by generating innovation 2

1 4 1 2

 ustainably procure andSprovide safe, secure products
and services throughout theentire value chain
Related key items

Material issues for supporting business growth

Risks and Opportunities

S (Social)

Material issues for achieving business growth

E (Environment)

1 3 5 6 1 3
Develop and strengthen
human resources to create a
new future and promote
diversity and inclusion
Related key items

1 2 6 2Further improve corporate
governance and integrity
Related key items

1 3

We seek to provide services that
promote carbon neutrality and acircular economy while cooperating
widely to build a carbon-free world.
We also aim to help reduce greenhouse gas emissions by reducing
the environmental impact of ourbusiness activities.

We will construct and maintain avalue chain that respects humanrights and has a lower environmental impact, and procure and provide
safe and secure products andservices.

We must become a company thatrecognizes and accepts individual
diversity, expertise, and values tocontinue creating innovation toachieve our future. To this end, we
will support our human resources
and build a more open corporate
culture.
We will construct and operate a corporate governance system thatmakes transparent, fair, quick, andbold decision making possible.
As a group that can provide social
value and ICT services as trustworthy, sustainable social infrastructure, we will comply with both
domestic and overseas laws andregulations, act in line with social
norms based on high ethics, andconduct sound, transparent business activities.

* A new society in which IoT, AI, big data and other new technologies are incorporated into every industry and every facet of social life to create innovation that resolves social
issues in ways that meet individual needs

22

BIPROGY Group Integrated Report 2023

BIPROGY Group Integrated Report 2023

23

Strategies Aimed at Realizing Vision 2030

Vision 2030

Material issues for achieving business growthMaterial Issues, Overview and ProgressMaterial Issues

Create Social Value reate schemes to solve issuesCthrough the use of digital technology
and business ecosystems
Related SDGs

Contribute to the environment
through the use of digital technology
and reduce the environmental impact
of business activities in order to help
build a world of net zero emissions
Related SDGs









Sustainably procure and provide safe,
secure products and services
throughout the entire value chain

Material issues for supporting business growth

Related SDGs



Develop and strengthen humanresources to create a new future andpromote diversity and inclusion
Related SDGs







Further improve corporate governance and integrity

Related SDGs24

 ontribute to society’sCsustainability by providing
businesses that solve theissues faced by society ontribute to the earlyCrealization of a decarbonized society by providing
environmentally friendly
services that promote carbon neutrality and a circular economy

 elp to reduce environH
mental impact by reinforcing initiatives to reducecarbon emissions frombusiness activities, such as
procuring renewableenergyC ontribute to the stability andmaintenance of IT infrastructure that supports societal
activities by providing safe andsecure products and services
that comply with various laws,
regulations, and social normsC ontribute to the spread of ethical consumption and help
build a sustainable society byproviding products and services
that take into consideration theenvironment and society elp solve social issues byH
continuously producing
innovative, talented
workers
 reate employment
C
opportunities for diverse
human resources ontribute to the creationCof a society that is physically and mentally
healthy, is accepting ofindividual diversity, andoffers work satisfaction

 elp to solve issues facedHby society and the economic growth of society
through transparent andfair processesC ontribute to the empowerment of all people, regardlessof age, sex, handicap status,
race, ethnicity, origin, religion, economic position, etc.
H elp to build a society inwhich workers can experience
job satisfaction by ensuring
equal opportunities throughthe elimination of discriminatory practices, creation andoperation of appropriate
related rules, promotion of
appropriate behavior, andsimilar activities

Create Economic ValueKPIs and Targets (FY of achievement) reate business opportuC
nities that contribute to
the solution of issues
faced by society and capture profits in createdmarkets

Create/expand businesses that solve the issues
faced by society and that look to optimize society
and the world. 200% or more of such projects compared to FY2020 (FY2023)

125.5%

Expansion of number of projects: Currently monitoring the growth rate in the number of such projects in our outsourcing business in line with our Management Policies (2021-2023). Simultaneously promoting the development of services that contribute to
the resolution of social issues.

Percentage achieved for target contribution to corporate net-zero emissions through customer use ofenvironmentally friendly products and services:
100% or more (annually until FY2030)

174.6%

contribute to the environment: Continuing to work towards reducing GHG emissions in our business activities as well as expand theprovision of products and services that contribute to the environment.











I ncrease profit from services that contribute to
the environment

 estrain costs by reducing
Rbusiness risks due to climate changeI ncrease profit opportunities by strengthening trustwith customers/suppliersand engaging withhigh-quality partner companies and thus reinforcing relationship capital

Percentage of business opportunities and risks
identified via climate change scenario analysis
impact evaluation) for which a risk response has
been implemented: 100% (annually until FY2030)

Percentage of purchased energy used at the Groupbusiness locations that is renewable energy: 50% ormore (FY2030)

Ratio of employees with disabilities: 0.1% or more
greater than the legally required percentage of
2.3% (annually) Expand business by generating innovation
Weighted average score of work style related items Increase profitability byin the engagement survey: at least equal to FY2019–
FY2020 average score (3.36) (FY2023)
raising labor productivity
Percentage of workers with risk of high blood pressure
who have received treatment at a clinic or lifestyle
guidance by public health nurse: 100% of workers
with stage 2 or 3 high blood pressure (FY2023)
Total number of lost days of work for mental healthreasons: -5% compared to FY2019–FY2020 average(FY2023)

Number of executives and employees participating in social contribution activities: 20% increase compared to FY2020 (FY2023)
Actions for each year set in the evaluation of Boardof Directors effectiveness are undertaken(each year) reate business ecosysC
tems and expand business
Improvement and upgrade in the complianceopportunities by estabprogramlishing trust with a wide
range of stakeholders
 enerate sustainableG
improvements in corporate value educe business risksR
related to scandals, etc.

Spread of awareness of integrity among Group
executives and employees
Compliance incident trends
Number of serious security incidents: 0 (each year)* The zero emission achievement rate is the sales of environmentally friendly products and services multiplied by the GHG reduction contribution coefficient and divided by the total
Scope 1 and 2 emissions of the BIPROGY Group.

BIPROGY Group Integrated Report 2023

23.4%

Continuing to promote the introduction of renewable energy.

Transition of procured power to renewable energy: Steady progress being made towards reaching targets according to plan.

P.52-55

Promotion of energy-saving measures through efficient use of offices and equipment and other means: Continuing

P.52-55

Achieved

Ratio of management positions held by women:
18% or more (as of April 1, 2026)



P.52-55

Disclose information on Scope 3 GHG emissions
and set related targets (FY2022)

 educe business risksR
related to issues such as
Rate of initiation of actions, such as requests forhuman rights and environ- action made to main suppliers, based on risk
mental impact throughout assessment results: 100% (FY2022)
the value chain

P.52-55

Continued implementation of extraction of business opportunities and risks related to climate change andassociated impact assessment through cross-organizational and Group-wide projects: Continuing to revise opportunities

25.1%

Percentage of human rights-related issues at
BIPROGY Group which are being addressed: 100%
(FY2023)

Reduction of GHG emissions in business activities and expansion of provision of products and services that

P.30-35
P.48-51

100%

Reduction rate in GHG emissions (Scope 1 + Scope2): 50% or more compared to FY2019 (FY2030)

Number of “business producers” armed with specialization in business creation: 40, double that in
FY2021 (FY2023)



FY2022 Results and Future Initiatives

83%(5 issues out of 6)

100%

37
10.2%

(As of April 1, 2023)

2.84%
3.47
Stage 2 100%
Stage 3 100%
+1.4%
+70%
(143)

and risks and respond to risks going forward.

similar initiatives to reduce emissions as we move forward.

Disclosure of Scope 3 data: Clearly documenting data-gathering and tallying rules starting in FY2021 and disclosing data starting in FY2022.
Establishment of emission reduction goal for Scope 3: Establishing goal of “suppliers who make up 40% of procured amount ofpurchased goods and services (Category 1) setting targets equivalent to SBT (target year: FY2027).”

Thorough dissemination of Human Rights Policy: Disseminating Human Rights Policy among overseas Group companies/disseminating the theme of respect for human rights among employees and enlightening them on that theme on an ongoing basis.
Development of complaint processing mechanism: Preventing human rights violations by developing a complaint processing
mechanism related to human rights and responding to those complaints.

Implementation of requests for improvements: Issuing requests for improvements for 49 companies based on the results of surveys on ESG-related initiatives conducted on main suppliers.

Future targets: Setting targets of “100% of suppliers surveyed on ESG risk (FY2026)” and “100% of suppliers currently adhere to or havelaunched improvements to material ESG risk items that the Group has set for suppliers (FY2030).”

Establishment of human resource pipeline: Establishing proficiency determination processes for business producers in ROLES andestablishing a proper pipeline for those human resources.

Reinforcement of development programs and accompanying monitoring: Enhancing training programs and follow-up mea-sures that link to actual business, including its creation/Realize organic linkage to development programs and work assessments by reinforcing the monitoring of development plans for each organization.

Administration of employee promotion plans: Continuously compiling and monitoring plans to promote organizational heads at

P.75

P.56-59

P.56-59

Expanding outdoor agriculture gardens (WAKUWAKU Farms) and transferring operations from BIPROGY.
Cultivating new occupational fields: Expanding employment by opening internal massage rooms and other facilities.

P.56-59

Health guidance: Implementing for all employees with stage 2 or stage 3 high blood pressure.

P.56-59

Expansion of operations at special-purpose subsidiary BIPROGY Challenged Inc.: Further expanding Web accessibility tests/
Score improvement measures: D​ eploying measures to facilitate a hybrid of online and offline communication/Ascertaining the actual stateof workstyles of employees permanently stationed at customer sites, etc. and examining measures commensurate with the workplace there.
Deployment to various Group companies: Sharing measures at BIPROGY with Group companies and examining their utilization there.

Improvement measures: Approaching employees whose stress check results showed high stress levels for an interview/Requestingorganizations with unfavorable stress check result values to take remedial actions and following up on those organizations/Revitalizing communication with employees on temporary leave with the use of external EAP/Making “your-time” (one-on-one sessions) between employees
up to their third year with the company and their superior compulsory and conducting counseling for all employees.

P.56-59

P.56-59

Expansion of social contribution programs: Refining social contribution programs/Planning the conducting of joint social contribution activities with internal organizations, other companies and external groups.

holding training sessions and meetings to exchange opinions.

Global strategy: Reports on global strategy were made to the Board of Directors and active discussions based on those reports were held.
Invigoration of discussion at meetings of Nomination ＆ Remuneration Committee and improvement of Committee transparency: The provision of information to
Outside Director Committee members was expedited and the content of that information was enhanced/Reports on the activity status of the Committee were made to the Board of Directors.

Initiatives based on the loss of USB flash drives: Carrying out full revision of compliance training programs for Group officers and employees/Sharing key pointsof third-party committee investigative report with compliance promotion supervisors and highlighting points for them to bear in mind in practicing compliance in theirorganizations as well as reflecting those points in training and enlightenment activities for FY2023 and beyond.
Accommodation of amended Whistleblower Protection Act: Putting a Group-unified hotline in place/Newly establishing internal regulations on the handling of whistleblowing/Implementing training and dissemination activities for matters that officers, employees and individuals engaged in whistleblowing counter duties should comply with.
Improvements to awareness surveys: Implementing compliance awareness surveys using a new method (twice a year starting in FY2022).

Compliance awareness survey results: All scores across each of the five categories of compliance understanding and awareness, measures and mechanisms, workplace management, organi-zational culture and the practice of compliance were at a favorable level of 4.0 or higher out of a maximum of 5.0/Survey results were shared with compliance promotion supervisors alongside trends inthe occurrence of compliance cases in the Group and linked to the implementation of measures for improvement. Plans call for the continued implementation of these surveys at a pace of twice a year.

Disciplinary action: 5 cases resulting in disciplinary action/While this figure is down from FY2021, cases resulting in serious action, such as suspension from work andthose equivalent to resignation under instruction, also occurred (including action taken against employees involved with the loss of USB flash drives). Measures to prevent
reoccurrence were conducted for each case, including calls for attention at compliance training sessions.
1 caseP.75

BIPROGY and Group companies/Conducting quantitative checks of linkage between goal-setting and career design for candidates for promotion.

Developmental support at Group companies: Enhancing training for Group company employees.

Enhancement of the effectiveness of monitoring by the Board of Directors: Endeavored to enhance the provision of information through means such as(Loss of USB flash drives)

P.52-55

Thorough implementation of measures to prevent reoccurrence: While there were no leaks of information, we caused significant

concern to and impacted customers and society/Launching Group-wide project to prevent reoccurrence and examining and implementing reoccurrence prevention measures based on survey results and recommendations from a third-party committee made up of external specialists.

P.60-67

P.70-72

P.70-72
P.70-72
P.70-72

BIPROGY Group Integrated Report 2023

25

Strategies Aimed at Realizing Vision 2030

Vision 2030

CSO Message

We will achieve sustainable growtheven in these uncertain times by ceaselessly tackling the spread of sustainability and the improvement of ourmanagement foundation.
Koji Katsuya

The BIPROGY Group pursues mutual sustainability among

Chairs of other Committees directly report and consult withsocial value and economic value. In these uncertain times,

and feedback from our Outside Directors and outside Auditor

the environment, society and the Group by generating both
it is not easy for companies to continue to sustainably

grow. If mechanisms for sustainable growth are insufficient,
it is necessary to implement new ones, examples of which

are improvements to management processes, the transformation of our organization into one capable of accommodating change, and a shift in employee mentality. As Chief

Sustainability Officer (CSO), the person with overall respon-

sibility for our sustainability management strategy, I believethat putting such a foundation for us to sustainably grow inplace and expanding the creation of solutions and services
that enable us to contribute to the sustainability and soci-the Board of Directors. Each time, we receive observations

Board members that are stern but constructive. In FY2022 as

well, we benefited from a variety of hints on human resource

strategy, risk management, climate change and natural capital, among other areas. I genuinely feel that opportunities todiscuss and review sustainability at meetings of the Board of
Directors are increasing year after year.
Corporate Governance

P.60-67

Sustainability Promotion Structure

ety as a result of that foundation are my mission.

Board of Directors

For our sustainability promotion system, under theInquiry“Sustainability Committee,” a decision-making body for

Supervise

which I serve as Chair, we have placed an “Environmental

Contribution Committee” and a “Social Committee.” In addition, we newly made the Chair of the “Compliance

Committee” a member of the Sustainability Committee starting in October 2022 and did the same with the Chairs of the“Risk Management Committee/Business Continuity Project”

and “Information Security Committee” starting in April 2023,
reinforcing coordination among those committees. While

this also constitutes a measure taken in order to ensure theimplementation of measures to prevent the loss of USB flash

drives such as the case that occurred in June 2022, it is simultaneously a reflection of our desire to intensify Group governance going forward. Our outside Auditor Board members

attend meetings of the Sustainability Committee as observers, and I, as Chair of the Sustainability Committee, and the

26

BIPROGY Group Integrated Report 2023

Executive Council

InstructInquiryLife Science Research
Ethics Committee

ReportEvaluative Reporton Progress inMaterial Issues

ReportSustainability
Committee
Environmental
Contribution
Committee

ReportNomination ＆Report Remuneration Committee

Representative Director,
President & CEO

Coordination

SocialCommittee

Human resources are the force that drives business.
Human capital management is therefore imperative forcompanies to maintain their sustained growth. Given that,the human resource strategy of the Group must be closely
linked to its business strategies. We have always pursued
the enhancement of “business producers,” diversity andinclusion, the visualization of human resources with afocus on our ROLES system, and the establishment of a talent management system. Furthermore, in April 2023, weestablished our new “Human Capital Management
Division” in order to more closely manage our humanresource portfolio, devise a human resource strategy for
the Group, and firmly implement them going forward.
Human Resource Strategy

P.56-59

Climate Change-Based Opportunities and Risks

Director, Executive Corporate Officer,
Chief Sustainability Officer (CSO)/
Chairman of the Sustainability Committee

Sustainability Management

The Importance of Human Capital Management

Audit

Group Internal
Audit Division
Audit

Risk Management
Committee/BusinessContinuity Project

Compliance Committee
Information Security
Committee

Business Execution Divisions (Business Divisions, etc. and Group Companies)

The Group has declared its support for the recommendations of the Task Force on Climate-related Financial
Disclosures (TCFD). It is evident that the earth is getting
warmer and that natural disasters are growing more
intense. If a company does not appear to have clarified andprepared for the risks that climate change exerts on theGroup, customers will not feel at ease leaving their systems
in its hands, and investors will not invest in it. We are therefore pursuing the creation of mechanisms to ensure we perform risk management from a medium- to long-term
perspective, which involves a high degree of uncertainty,

and guarantee the sustainability of our business activities.
At the same time, in terms of our recognition of business
opportunities, we have positioned “Contribute to the environment through the use of digital technology in order tohelp build a world of net zero emission” as one of our material issues, and offer a myriad of services and solutions tothat end. Additionally, given that environmental issues cannot be resolved by the Group alone, our joint efforts withour customers and collaborative partners to resolve themthrough business ecosystems are growing.
Environment

P.52-55

Internal Instilling of Sustainability, Starting with Material Issues
The realization of sustainability targeted by the Group cannot
be accomplished with the heightened awareness of only certain employees. A challenge we face in facilitating future sustainable growth is how to elevate the sensitivity tosustainability of each and every one of our employees who will
uphold the coming generation, including our young employees. We therefore implement “Caravans*” for the purpose offurthering mutual understanding of Group policies and companywide measures by management and employees throughdirect briefings for and direct dialogue with employees. In
FY2022, having set understanding Group initiatives for sustainability as our goal, Caravans were conducted for all Group officers and employees over a total of three sessions attended by
2,507 individuals in all. The post-completion questionnaires
Internal Instilling of Sustainability
CommunicationInternal communication
 aravan, messages fromC
officers, intranet sites,
e-learning, etc.

External communication
Media communication, IR,seminars/events, website,
etc.

Receive nderstand theUGroup’s initiatives
for sustainability

that we administered showed us that while the sessions wereeffective to some degree in improving recognition of sustainability management, sadly, roughly 30% of attendees still did
not have a sufficient understanding of our material issues.
Also, in January 2023, we carried out “Sustainability Week”
during which we delivered messages from members of the
Sustainability Committee, our Outside Directors, and the presidents of Group companies. Going forward, we intend to continue monitoring the degree to which sustainability
management is spreading and keep up our efforts to examine
and implement effective measures for instilling it.
* A series of events consisting of workshops, seminars, etc. conducted by companies in order to instill their culture. Caravans are conducted for the purpose of
having employees form an understanding of their company’s strategy and philosophy, boosting their engagement, and promoting the growth of that company.

Actions by BIPROGY Group employees
Be aware e fully convincedB
about sustainability
and material issues
 Recognize the connection that sustainability
and material issues
have with ouroperationsAct ink operations to susL
tainability and material
issues and execute them Communicate with customers and partners in
the context of sustainability and jointly aim toresolve social issues
Realization of

Vision 2030

BIPROGY Group Integrated Report 2023

27

Strategies Aimed at Realizing Vision 2030

Management Policies (2021-2023)

Vision 2030

Review of Past Mid-Term Management Plans

Mid-Term Management Plan

Mid-Term Management Plan

Mid-Term Management Plan

Corporate Transformation for
Sustainable GrowthBusiness Model
Transformation

Become a sustainable company and achieve asustainable growth cycle predicated on resolving,
through business activities in our priority areas,social issues in the context of customer issues.

VisionFY2012–FY2014

FY2014

4.1%

KPIs

Operating Margin
Net SalesROE¥269.2 billion
26.0%

Added the ability to design
and implement new services
to our existing strengths

 ook a social perspective toTcreate business ecosystems
that link different industries Collaboration with Dai Nippon
Printing Co., Ltd., which has
strengths in the content field Provided payment/settlement
platforms as a service business
entity Strengthened financial
conditionStrategies ddress business model transforA
mation through global andcross-industry collaboration, etc.

Business Environment

 ddress major changes in theAsocial environment resulting fromexpansion of digitalization and theemergence of new consumers Creation of a new business platform to address the spread of thecloud and usage-based servicesIssuesWeaknesses to Overcome

Strategies and Key Outcomes Acquired Strengths

Dividend
Payout Ratio

9.7%

28

BIPROGY Group Integrated Report 2023

FY2015–FY2017
Innovative Challenge Plan

FY2017

5.7%

Operating Margin
Net Sales¥287.0 billion(Net sales in the areas of digital innovationand life innovation) (¥27.0 billion)

ROE

Dividend
Payout Ratio

12.4%
33.6%

Took on challenges in new business areas and strengthened our
foundation for further growth
Increased
profit and number ofpotential new businesses by
expanding business in the digital and life innovation fields
 Increased profitability by concentrating on fields ofstrengths, such as business ICT
platforms, and improving laborproductivity Promoted a change in skill sets
in line with business modeltransformation Proactively promoted investments in business partners inJapan and overseas as well as
Fund of Funds (FoF)


Strategies urther expand businesses in theFareas of digital innovation and life
innovation and reinforce initiatives
in the various strategies

Business Environment

 ddress the decline in system inteA
gration needs due to the emergenceof business-related ICT services Address the risk that a delay inresponding to the digital shift will
impede growth Address the risk of hardware andsoftware market contraction due tocommoditization Address the aging workforce andmismatched skills Address the risk of a slowdown ingrowth of Japan’s ICT market

We will develop the Digital Commons which is a platform thathelps create a society where everyone can live happily.

Current Management Policies and Long-term Vision

Management Policies

FY2018–FY2020

FY2020Operating Margin
Net Sales(Net Sales in Priority Areas)

ROE

Dividend Payout Ratio

8.6%¥309.7 billion(¥68.4 billion)

13.4%
41.1%

Acquired assets to transform the Group
into one that creates social value by
expanding business in priority areas uilt a foundation for the direction that should be
Bpromoted in the next management policies throughinitiatives in the core fields of neo-banks, digital
acceleration, smart towns, and asset guardian Reviewed human resources and roles in businessexecution, cultivated relationships with customers, and contribute to greater customer value Strengthened platform provision capabilities
through measures to integrate technology
throughout the Group, increase productivity,and increase efficiency Implemented measures on various fronts,
including corporate culture reforms that promote challenges and reforms in awarenessregarding diversity Proactively implemented initiatives that foster
open innovation and acquired knowledge throughinvestments that target new business creation
Strategies

 ccumulate experience in the field of business creAation and make use of related intellectual assets
and resources Create intellectual assets to accelerate the development and provision of platforms and enhance verification of combined technologies Manage the investment portfolio to further increase
benefits of knowledge acquired throughinvestments

FY2021-FY2023

Concept to Achieve a Sustainable Society(IFRS*1)

Actual for FY2021

Actual for FY2022

Targets for FY2023

Revenue¥317.6 billion¥339.9 billion¥340.0 billion

17.0%

15.0%

8.4%

Adjusted Operating Margin*2

8.6%¥63.4 billion

Outsourcing Business*3

ROE¥66.7 billion

41.7%

Dividend Payout Ratio

39.8%*1 International Financial Reporting Standards (IFRS) applied starting FY2021*2 Adjusted Operating Profit: Revenue minus cost of sales and SG&A expenses*3 System outsourcing as well as service businesses where BIPROGY Group is the provider

 estrained investments by some customers andRstagnation of inbound and sharing–related businesses due to the COVID-19 pandemic Aiming to advance corporate culture reforms andhuman resource development, we strengthened
efforts to spread and adopt the concept of ROLES
that take into consideration intrapersonal diversity¥100.0 billion
Approx.

Approx.

15%

40%

Basic Policy

The BIPROGY Group will achieve the Vision 2030 plan by pursuing digital transformation (DX) for bothcustomers and society, developing its business through a large framework that encompasses all ofsociety, and working with partners and the community to expand business ecosystems.
For Customer
For Society

Fiscal 2022 Initiatives

Pursue DX that leads to sustained growth forcustomers by strengthening value creation
capabilities and generating social value

Expand business that links customer DX
P.30-35
to social DX

Use relationships with customers and partners in a wide
range of industries, together with best practices, to realize
business concepts that benefit all of society and the world

Corporate Culture Pursue cultural reforms to strengthen value creation
Reforms
capabilities and achieve the Vision 2030 plan
Investment
Strategy

Focus on strengthening human capital toP.56-59
capture new capabilities

Actively make investments to create value andachieve further growth through technology
P.48-51
and innovation

Accelerate strategic investment on leading-edge
technologies aiming for the sustainable innovation

Business Environment

10% or higher

Material Issues category

Material Issues
for achieving
business growthMaterial Issues
for supporting
business growthFiscal 2022 Initiatives

Material Issues

Create schemes to solve issues through the use ofdigital technology and business ecosystems

Contribute to the environment through the use of digitaltechnology and reduce the environmental impact of businessactivities in order to help build a world of net zero emissions
Sustainably procure and provide safe, secure products
and services throughout the entire value chain
Develop and strengthen human resources to create a
new future and promote diversity & inclusion
Further improve corporate governance and integrity










 romote the development of services that contribute toP
P.30-35
the resolution of social issues
Establish emission reduction goal for Scope 3

P.52-55

 stablish proficiency determination processes for businessE
producers in ROLES and establish a proper pipeline for
P.56-59
those human resources nhance effectiveness of monitoring by the Board ofE
P.64
Directors

 xamine and implement reoccurrence prevention meaEsures in light of the incident involving the loss of USB flash
P.70-72
drives

BIPROGY Group Integrated Report 2023

29

Strategies Aimed at Realizing Vision 2030

What Our Management Policies (2021–2023) Aim to Achieve
Based on the two ideas of “for customers,” promoting DX for customers that contributes to their sustainablegrowth, and “for society,” promoting DX for society that helps solve the issues faced by society in collaboration

with partners, we will expand the business ecosystem for solving those issues and link that to realizing Vision 2030.

Key Points of Management Policies (2021–2023)
Based on our Purpose and Vision 2030, the BIPROGY

Group formulated Management Policies (2021–2023) withan eye toward creating economic value and generating

the massive framework of society in collaboration withcustomers and partners.

ing strategies based on plans that incorporate forecasts

several years in the future. Therefore, we are working toachieve our future vision as each Group employee autono-

mously makes decisions and acts based on those management policies guided by our Purpose.

The BIPROGY Group has set “for customers,” promoting

DX for customers that contributes to their sustainablegrowth, and “for society,” promoting DX for society thathelps solve the issues faced by society through co-creation
with customers and partners from various businesses andindustries, as the basic policies within Management

Policies (2021–2023). By accumulating the best practices ofcustomers implementing a DX and promoting DX for society, the Group will expand its business ecosystems within

combining best practices. Having built not only trust withcustomers in a wide range of industries but also relation-

ships with partners, not being dependent on one particular

relationship, through the formation of business ecosystems,
we will use these strengths to continue to create social

Achieve futuristic retailingPromote solutions to social problems throughout the value chain and the supply chain

and accuracy of systems for individual customers, we areThus, we will co-create value with customers and transform
both ourselves and our customers through these businessecosystems. We also aim to contribute to society by com-bining the various services that we have evaluated and verified for the market, including through a proof of concept(PoC) method, and moving to the implementation stage.

* VUCA is an acronym formed from the words “volatility,” “uncertainty,” “complexity,” and “ambiguity” to describe a situation when it is difficult to forecast the
future social environment.

Employment conditions DI*

moving forward with realizing futuristic retailing by focusing on support for store operation reforms.

(percentage point)��AI-Order Foresight, an automatic order system based on

opportunity losses. Furthermore, more stores have intro-

increase the speed of business with heightened agility.

including production and logistics.

operations, such as orders. Having improved the efficiency

our implementation capabilities acquired over the years tosociety,” elements of our Management Policies, we will use

emissions by sharing data throughout the supply chain,increase the efficiency of various functions in peripheral

AI demand forecasts, dramatically reduces hours spent on��orders and contributes to reductions in waste loss and�-��

duced electronic shelf labels, which make it possible to

Excessive
Insufficient-��display, in real time, various information such as selling-��

price and sales promotions and enable two-way communication. They are increasingly used as IoT devices for-��

employee and customer points of contact. In addition to-��(year, quarter) ����/�

reducing labor and time needed to replace price tags, they

All industry

contribute to labor savings and greater operational effi-����/�

����/�

Manufacturing����/�

����/�

Nonmanufacturing����/�

Retailing

Source: “TANKAN (National Short-Term Economic Survey of Enterprises in Japan),”
Bank of Japan

ciency by, for example, increasing the efficiency of inven-* The percentage of companies who say they have an excess number of employees
minus the percentage of companies who say they have insufficient employees.
The more the number is above zero, the greater the sense of there being excessive
employees, and the more the number is below zero, the greater the sense of there
being insufficient employees.

tory checks and shelf stocking.

As the market undergoes various changes, namely theadvent of OMO stores that incorporate digital technology,

For Society (social DX)

Aim to solve social problems through co-creation
with customers and partners in diverse industries

Co-Creation

For Society
DX for Society

Solutions to social issues for a better worldTransformation

Futuristic retailingenvisioned by
the BIPROGY Group

Sustainableprocurement

Providing a new buying
experience through EC and
Online-Merges-Offline (OMO)
solutionsElectronic shelf labels

DX for Customers

Work with customers to implement corporate and industry DX that supports DX for society

AI automated order system

Hands-on

POS cart

Digital code

Evolution of futuristic retailingCore business infrastructure, such as core system

CoreCenter
CoreCenter
BASE

MD platform

Mart
Solution

Reduce greenhousegas emissions

Futuristic retailing

Image analysis service

OMO data platform

For Customers

BIPROGY Group Integrated Report 2023



product delivery that matches lifestyle, we will continue tovided merchandizing (MD) core systems for customers invalue. By creating a virtuous cycle “for customers” and “forFor Customers (customer DX)

30



work to achieve greater operational efficiency and net zero

Promote DX that contributes to thesustainable growth of customers

Implementation

Social DX

the retail industry for many years but also has worked to

Aiming to provide value sustainably with customers and partners by creating a virtuous cycle
for customers (customer DX) and for society (social DX).

AgilityI ncrease store operational
efficiency and labor savings Optimize inventory and waste loss Reduce lost sales opportunities

business types and industries, we possess business conceptualization and engineering capabilities accumulated byrespond to changes by creating, implementing, and revis-

CustomerDXdiverse product lineups and purchasing channels, andwe live in a so-called VUCA* era, when changes in the time

hard to anticipate the future, it has grown more difficult toGenerating both social value and economic value through retail store
reform solutions

In the retail field, the BIPROGY Group has not only pro-tem integration services and solutions to a wide range ofand technological evolution occur at a faster pace and it isTransitioning from store operation reforms to futuristic retailing

Example initiative ❶In addition to the knowledge obtained by providing sys-sustainable enhancement of the Group’s overall corporate

value through the pursuit of social value creation. Because

Expanding from customer DX to social DX

Data analysis

Solve social
problems

Eliminate labor
shortages
Reduce loss andmaximize profit
Respond to diverse
buying behavior
Opportunities of
local communities

BIPROGY Group Integrated Report 2023

31

Strategies Aimed at Realizing Vision 2030

What Our Management Policies (2021–2023) Aim to Achieve

Expanding from customer DX to social DX

From housing DX to social DX

Example initiative ❷Moving from housing DX to social DX through collaboration with diverse
industries and partners
CustomerDXI ncrease operational efficiencyof home design operations Support response to businessenvironment changes

 romote creation of a society in whichP
everyone can live happily Promote decarbonized society springing
from housing industry, including smart
home responseSocial DX

Future of energy and mobility use

Aiming to contribute to a sustainable society by providing services thatcombine energy and mobility services
CustomerDX upport companies and local
S
governments’ shift to EVs byintegrating energy and mobility
services

Social DX nable the use of EVs as moving storage
E
battery Incorporate into BCP and contribute to realization of decarbonized societyIn the housing industry, the shortage of not only engineers but

increasing the efficiency of operations. In addition, with a

To promote decarbonization, Japan’s government has

aiming to become carbon neutral by combining “Enability

time that designs and proposals are becoming more complex

devices depending on the situation, such as sales talks andelectric vehicles (EVs), account for all new cars sold by 2035,

for almost a decade. As a “company working with custom-

smart operating environment, it can be used with various

also worksite carpenters is growing more serious at the same

discussions.

in order to meet more diverse customer needs, resulting in a

The BIPROGY Group will promote such work as reinforc-

need to use CAD data in the production process and increase
the efficiency of collaborations with external business opera-

ing functions related to presentations and linking data, cen-

went a major update, has evolved into a building information

functions that leverage AI and other cutting-edge technol-

tered on the integrated home model, and expanding

tors. The home design CAD system DigiD Prism, which under-

ogy. The Group will work to create a society in which allmodeling (BIM) platform with improved CAD system functions

people can live happily (social DX) by leveraging its relation-and the possibility to undertake integrated management ofships with diverse industries and partners and best prac-home-related data. Information is often managed separately

tices through the promotion of DX in the housing industry.

in different systems, such as CAD, customer management,

and sales systems, but DigiD Prism provides unified manage-* A system that makes it possible to undertake integrated management of information generated in all home construction processes as a “home information database” by assembling parts and material with shape and attribute data andforming a detailed, three-dimensional “home” into a database.

ment of that information as an “integrated home model*” andeliminates discrepancies in data between processes, thus

Home design CAD

Developed
home design
CAD

H CAD

1980

Reducedtime to create
drawings

Mainframe

Improved
efficiency ofoverall design
operations

H CAD/WS

1990

Workstation

Refine•H ighly digitalized•M aintained DigiD
home-related
concept and assets
information• P rovided series of high- • S trengthened house
design functions
value-added solutions
DigiD
DigiD meister
PC

1998

PC

2011

Increases the diversity and efficiency of operations
Supports diverse workstyles and increases efficiency
by integrating information and reinforcing functions

Evolved into a BIM
platform notlimited to home design

Incorporates smart operating environment

DigiD Prism

PC/Smart device

2022

20XX

Sales
EstimatePlansearchRenovations

Home functions
Energy efficiency

Production information
Design information

Home information

For Customers

Wind direction

Logistics
Equipment installer

BIPROGY Group Integrated Report 2023

VIEWER

concerns, however, that unless charging and discharging of
EVs is properly managed, this could not only negatively

impact operations due to problems related to vehicles not

being charged but also result in higher electricity bills if vehicles are charged simultaneously during peak demand time.

As a service to solve this problem, the BIPROGY Group introduced “EV Charging/Discharging Service ,” which offers

AI-based remote automatic control. With this service, it is possible to use EVs that consumers (EV users) own as a power

Construction

Production

DesignFinalized
drawings and Structuraldesignspecifications

Interactive
VR

For Society

governments shifting to EVs for their official or company

use, the Group is creating services to support all companies

Cost
Housing
calculation performance
Smart city
Governmental offices

Target vehicle electrification in the Green Growth Strategy*1
Passenger
vehicles*2

Vehicle management
systemEnergy Maximize use ofrenewable energyM inimize electricity bill
 Use for BCP

100% of new cars sold are electric-powered cars by 2035

• Electric-powered cars account for 20%30% of new cars sold by 2030
Compact
vehicles, 8 • Electric-powered cars or vehicles that cantons or less use decarbonized fuel, such as synthetic fuel,Commercial
account for 100% of new cars sold by 2040

vehicles*2• Preemptively introduce 5,000 elecLarge vehitric-powered vehicles in the 2020scles, over 8• Set 2040 target for spreading the use of
tons
electric-powered cars by 2030

Promote electrification through initiatives both in Japan*1 Action plans to achieve carbon neutrality by 2050 created by related ministries
and agencies, particularly the Ministry of Economy, Trade and Industry, for 14
priority fields expected to see growth due to industrial and energy policies*2 There is no definition of passenger vehicle and commercial vehicle (Japan
Automobile Manufacturers Association, Inc.).

Connected

Electricity Retailer

EV charging/discharging service

Vehicle operation
management system
Power company

to contribute to the realization of a sustainable society.

dards for storage batteries and building infrastructure

In addition to providing services that combine energy

VPP*3/DR*4 instructions

ers and partners to solve social problems,” we will continue

Source: Tomoko Takano “Issues to Achieving Carbon Neutrality in the Automobile
Industry—Electrifying Cars ,” (September 2021) (Tentative title translated
from Japanese)and mobility services, primarily for companies and local

Energy service operator

Series” and “smart oasis,” both of which we have provided

Motorcycles and overseas, including introducing international stan-

resource, a “moving battery,” and reduce electricity bills byHome design operation problems• Mismatch with completed house image• Proposal and designs that exceed
customer’s needs and expectations•C omplex design for energy-efficient houses• Collaboration with external business
operators• Shortage of worksite carpenters

Confirmation of
DigiD Prism Structural
drawings andspecifications Design support calculations
application

DigiD Prism and sunlight
Sales support simulation

VR
Proposal
renderingboard

electrification of cars for official or company use. There are

Link

Post-construction
services

crete plans, which has resulted in the growing demand for

Can be used with the optimal device for each situation anduser due to more compact operating environment

Construction information

Optimizes new home creation
through a BIM platform that
integrates and manages
home related data

Medical institutions

Platform

Integrated home model

Housing business solution
DigiD Prism

and companies and local governments have drawn up con-and incorporate EVs into their BCP in the case of a disaster.

Providing a home design CAD system that employs the latest, best suited IT for 40 years

High-valueadded solutions

touted the target of having electric-powered cars, including

discharging EVs (reduce use during peak demand periods)

Evolution to DigiD Prism

32

Example initiative ❸Automated

smart oasis

MobilityA void empty batteries and forecast consumption SOC*5
 State of EVs (parked/out) Avoid deterioration
in batteries

Demand forecast

Power generation
forecast

Demand for power

Solar power

Control
instructions

Control
instructions

Electric vehicle (EV) (storage battery)

Enability

Decarbonization

Create environmental value
Realize a decarbonized society

Optimize

Deregulation

EV charging/discharging service

Sharing

Digitalization

Electric

Decentralization*3 VPP: Virtual power plant (VPP), a mechanism for connecting generation facilities owned by companies, local governments, and other entities, home power generation facilities,
storage batteries, EVs, and other energy resources distributed throughout a region to function like a single power plant by controlling the resources using IoT technology.
*4 DR: Demand response (DR) refers to altering power demand patterns by controlling the energy resources of consumers.
*5 SOC: State of charge (SOC) is an indicator showing the charge rate or charge state.

BIPROGY Group Integrated Report 2023

33

Strategies Aimed at Realizing Vision 2030

What Our Management Policies (2021–2023) Aim to Achieve

Expanding from customer DX to social DX

Example initiative ❹Creating value for local communities through financial services

Outsourcing as Growth Driver

Contributing to the creation of value and DX of local communities
through more sophisticated financial services
CustomerDX uickly provide an extensive seriesQof financial services at low cost Support greater efficiency offinancial operations

by contributing to more sophisticated financial services

In Management Policies (2021–2023), we position the outsourcing business, which boasts a high marginal profit ratio and helps
form a stable earnings base, as the Group’s engine of growth.
The Group’s outsourcing business offers several services,
including entrusted operation services for customers’ operational systems, services that contribute to customers’ digitaltransformation, and services to resolve social issues through collaboration with customers and partners. In addition we aim tofurther increase profitability and create social value by reinforcing our stable earnings base through new projects, developing
outsourcing services that leverage the knowledge and know-how
we have obtained through the provision of services to customers, and accelerating efforts to create and expand our services
that solve social issues.

with customers in various types of business and industries.

FY2022 ResultsSocial DX upport new value creation by financial
S
institutions and local communities and promote the creation of affluent societies

Leveraging the abundant solutions, services, and knowl-

parties. As financial institutions shift their investments tofinancial institution customers, the BIPROGY Groupnew value for financial institutions and local communities

edge acquired over many years of promoting the DX oflaunched an examination of the financial service platform

concept. By integrating a large series of financial solutions
that the Group provides, which range from back officeones to front office and channel-related ones, through anadvanced common architecture and using function-spe-cific API* etc., customers can implement data-driven management, including automated operation, unified

regulatory response based on automated and integrated
data management, customer analysis, and regional trait

analysis. This offers them highly reliable services appropriate for their business strategy and thus increase the efficiency of overall operations.

It is expected that financial institutions will move from

offensive DX, the Group is moving forward with creating

through this platform and creating business ecosystems* API: Application programming interface (API) aggregates the instructions andfunctions that can be used when developing software for a specific platform.

IT market for domestic Japanese financial institutions,scale and forecasts(Billions of yen)

�,���
�,���

�,���

value for local communities (offensive DX). Financial insti-

�,���

tutions who were quick to introduce an open, cloud-based

core-banking system increase the efficiency of their existing
financial services and are moving forward with a financial

service DX because they will be able to make use of various
data and functions through collaboration with outside�,���.� �,���.� �,���.�

�,���investing in core-banking systems to investing in DX inorder to increase the value provided for their users and the

�

����

(FY)

Regional companies and individuals

Fusion of Digital and Real
Customer Approaches

New Regional Business Models

Counseling/
consulting

Human resource
Regional humanmatching support team resources network

AI analysis

External coordination

More efficient opera- Coretions as a wholebanking

Data Use
Data

Cost Optimization
Fund
securities

External
Joint operations International connection

ChannelInformation

Digital contacts
strengthening

Data analysis

Analytics personnel
Financialmanagement

BIPROGY Group Integrated Report 2023•••

Use advanced
technologies

Go paper-lessWorkstyle reforms

����

����

�,���.� �,���.� �,���.�

����

����

����

�,���.�

����

Forecast

Source: Yano Research Institute, Ltd., “Digital Transformation for Financial Institutionsin Japan: Key Research Findings 2022” (released October 26, 2022)

For “corporate DX type,” we are steadily increasing revenue of not
only platform services for promoting the DX of financial institution customers but also other companies’ cloud services related
to remote work. For “entrusted operation type,” there was a
decline in revenue as services provided to customers shifted to“corporate DX type,” but for “service-based type (business creation type),” there was greater use of platform services for EC,
and the value cards and digital code businesses were firm.

*2 Figures for FY2022 and after are forecasts

Business Ecobank

Financial
institutions

Organizations

Supporting compliancewith digital regulations

Supporting sophistication efforts of financial services and cost optimization efforts

Need for rapid support for business management decisions
partly on overbanking and branch offices re-organization

Diversifying user
supports

Various customer stories areproduced based upon digitalized contacts with customers

Financial institutions as customers

Sustain customer
business and trust

Households and persons

Consumer/regional population

Regional
companies

���
�

(FY)

���.�

��.�

��.�

��.�

��.�

����

���.�

����

J-GAAP

���.�

����

���.�

����

���.�
���.� ���.�
���.� ���.�
���.�

��.�

����

 Revenue (net sales) (excluding outsourcing) Outsourcing revenue (net sales)

��.�

���.�

����
����
(Forecast)* (Target)

IFRS* Beginning of the fiscal year earnings forecasts

Outsourcing services provided ina new form due to entrusted
operation services and are
improved by digital transformation

Outsourcing services provided
by the Group alone or the Groupand customers as operating
entities

Value
provided

Increasing the efficiency andsophistication of customer
business

Transform customer companies
and establish competitive
advantage for the businessMove toward providing andoperating digital commons tobuild a better society and solve
issues faced by society





Main
services verall IT outsourcing and businessO
outsourcing services
 ankVision, an open core-banking
Bsystem (on-premises type) BI21, a core-banking system forS
regional financial institutions











More users offinancial functions

More companies are connected through financial services,and thus enhance convenience for users. Eventually, money flows are activated in the economic zone.

���

���.�
���.�

���.�

Entrusted operation services forindividual customers

Commonalize, share,
and coordinate

Coordination throughout an Economic Zone

���

���.�

Characteristics

Non-financial companies/services businesses
More participants���Service-based type(business creation type)

External services

More rapidly embed
unbundled financial functions in other businesses(Billions of yen)

Corporate DX type

Other financial institutions

Realign financial
functionsOutsourcing Revenue

Entrusted operation type*1 Business sales basis

Financial Service Platform Concept34

In FY2023, we focused resources on system services businessto handle customers’ DX, and therefore, we expect to post revenue that exceeds targets in the Management Policies (2021–2023), but outsourcing revenue is forecast to fall short of thetarget of ¥100.0 billion. We will use the know-how accumulated
by providing system services to create future growth of the outsourcing business.

FY2022
Revenue¥49.0 billion-¥0.8
billionYoY ankVision on Azure, a public cloudB
based full-banking system ptBAE, a use-type core-banking
Osystem for regional financial
institutions

 I-Order Foresight, an automaticAorder system based on AI demand
forecasts

 nability CIS, an electricity retailingE
cloud solutions

 loud services, such as those relatedC
to telework¥10.8 billion+¥3.3
billion
YoY













 aaS-type EC/OMO solution DIGITAL’SATELIER ero-Accident Program DR, a comZ
munication-type drive recorder igital value cards and digital codeDbusinesss mart oasis, a mobility service
platform
Storage service platform aigai Net, a chronology-type crisisSmanagement information sharing
system

¥6.9 billion+¥0.7
billionYoY

BIPROGY Group Integrated Report 2023

35

Strategies Aimed at Realizing Vision 2030

CFO Message
Aiming to accelerate strategic

investment and harness pioneering
technology to create sustained
innovation

the research and development needed to accelerate thetheir businesses, and we believe that this activity is neces-training of talented human resources, and therefore, we cur-businesses. While it may take a little time for these initiatives

development of new services, as well as the acquisition andrently do not expect to reach double figures. Despite this, wehave not abandoned the goal of eventually achieving a ratioof 10% or over, and we aim to achieve this goal while continuing to make the necessary investments.

we see extremely strong overall demand irrespective of customer industry. In addition to the demand for DX driven by

and have put forward the ambitious goal of increasing sales

labor shortages and changing work styles, demand forfrom the outsourcing business to ¥100.0 billion over thisinvestment is high in a wide range of other areas, including

three-year period. However, we are currently not achieving

the need to avoid the “2025 Digital Cliff” by replacing out-of-

the rate of growth that we originally expected, and therefore

date legacy systems. We are meeting this customer demandneed to further accelerate the growth rate. The main reason
that we have not achieved the expected growth is that wehave strategically focused on allocating resources to our system services business in order to capture the extremely

strong ongoing customer demand for DX. However, theseprojects serve as an opportunity for us to acquire new assets
by serving as a partner to customers working to transform

Under our Management Policies (2021–2023), we are aim-

extremely close to achieving ¥340.0 billion, our target foran adjusted operating profit ratio of 10% or over, and, withIn terms of profitability, the Group was able to absorb an

the policies’ final fiscal year, one year ahead of schedule.

ing, for the policies’ final fiscal year of FY2023, to achieve

regard to revenue, shift our emphasis onto service-based

increase in SG&A expenses through increased revenue froming sales from our outsourcing business to ¥100 billion andthe achievement of ¥29.7 billion in operating profit of, up

system services and through improved profitability, enabling

businesses in order to achieve sustained growth, increas-¥2.2 billion from the previous fiscal year (for a profit ratio ofoverall revenue to ¥340 billion. We are also aiming to8.7%), and adjusted operating profit of ¥29.4 billion, up ¥2.7

achieve an ROE of 15%, and, in terms of shareholder

billion from the previous fiscal year (for a profit ratio ofreturn, a consolidated dividend payout ratio of 40%.

8.6%). In addition, we achieved an ROE of 15.0%, and a con-In FY2022, our second year under the current

solidated dividend payout ratio of 39.8%. In FY2023, we aim

Management Policies, our system services continued to

to capture the demand for DX to go beyond our previous tar-perform well amid extremely strong demand for investment

get for revenue. However, in terms of adjusted operatingin IT, and we recorded revenue of ¥339.9 billion (of which

margin, which is our most important index, we believe that

¥66.7 billion were generated by our outsourcing business),

we must make the further robust investments required forup ¥22.3 billion from the previous fiscal year, coming

Targets and Progress in the Management Policies (2021-2023)
Adjusted Operating Margin*1

Revenue

Outsourcing Business*2

ROE

FY2021

FY2022¥317.6 billion¥339.9 billion

17.0%

15.0%

8.4%

¥63.4 billion

Dividend Payout Ratio

41.7%

8.6%

¥66.7 billion
39.8%*1 Adjusted operating profit: revenue minus cost of sales and SG&A expenses.
*2 System outsourcing as well as service-based businesses where the BIPROGY Group is the provider.
*3 Beginning of the fiscal year earnings forecasts

36

BIPROGY Group Integrated Report 2023

(vs. FY2021)

FY2023 forecast*3

FY2023 target+7.0%¥350.0 billion¥340.0 billion-2.0pt—+0.2pt+5.2%-1.9pt9.1%¥75.0 billion
41.1%

10% or higher¥100.0 billion
Approx. 15%

Approx. 40%

Observations on the market environment

various market statistics back this view. Across our Group,

tioned our outsourcing business as a key driver for growth,

Progress during FY2022 and forecast for FY2023

further revenue in the outsourcing business.

munication technology services is extremely vibrant, andUnder our Management Policies (2021–2023), we have posi-

Senior Corporate Officer and CFO

to bear fruit, we believe that in future they will contribute to

We believe that the current market for information and com-

The outsourcing business as a growth driver

Kazuma Umeharasary as a foundation for the development of service-basedby providing solutions related to customer touchpoints, anarea where our Group is strong, as well as through our expe-

rience in large-scale mission-critical projects. It is this robust
business environment that gives us the opportunity toinvest in the acquisition of new assets and lay the groundwork for a transition to service-based businesses.

Toward sustained increases in corporate value
Our Management Policies (2021-2023) position investment

We will procure the funds necessary for these activities

as an important part of our important strategies, and wefrom the cash flow produced by existing ICT businesses,

would allow us to leverage advanced technology and pro-will achieve future growth, while also using the cash thatand from our service-based businesses, which we expect

are committed to accelerating strategic investments that

we already have on hand, using these resources to invest

duce sustained innovation. Through strategic investments

proactively while ensuring the company remains on aand capital investments in various businesses, startups,

and funds, we are aiming to develop new businesses andsupport our existing businesses, actively shifting our financial resources into growth areas.

Schematic diagram of our capital allocation strategy*4
Revenue

Sales of investment
securities

sound financial footing. To ensure our finances remain
healthy, we aim to keep our net debt-to-equity ratio at

around 0.5 times while keeping our A rating. Currently, we
Expenditure

Actively investing while maintaining a robust financial position
Financialhealth¥4.7 billion

Net cash provided byoperating activities¥148.8 billion

Improving our financial healthCurrent cash and cash deposits increased
over FY2018-2022 byBorrowing decreased over FY2018-2022 byPreservationand growthinvestments

approx. ¥25.0 billion
approx. ¥7.5 billion

Accelerate the execution of our investment strategy, etc.
Promoting in strategic
investment
approx. ¥83.0 billion
Making capital investments*5

Shareholder Maintaining and increasing dividends
returns
Payout ratio: 40%approx. ¥34.0 billion
Cumulative data for most recent five years(FY2018-2022)*4 Data up until FY2020 is based on Japanese generally accepted accounting practices (J-GAAP). Data from FY2021 onwards is based on International Financial ReportingStandards (IFRS)*5 Following the adoption of IFRS, data from FY2021 onwards includes repayments of lease liabilities.

BIPROGY Group Integrated Report 2023

37

Strategies Aimed at Realizing Vision 2030

CFO Message

solutions to social issues, and to that end we are currently

Structural Reform Investment

Management Division in April 2023. This division is now

policies and roadmap through to 2030. Over previous years,

sustainable Group growth is to further strengthen our cor-resources strategy, and as we deliberate the details of ourengaged in internal discussions on our next management
our strategic investment has focused on investments inopen innovation by corporate venture capital and researchand development designed to create service-based busi-

nesses, but going forward we believe it indispensable to bolster our investment in inorganic growth, including M&A

outside Japan. Currently, we are promoting a number of
M&A projects in the Southeast Asian region, which areinvestments in companies providing Enterprise Resource

Planning (ERP) services for the main purpose of strengthen-ing and expanding the foundations of our global business inhave a cash surplus, and believe our working capital is

the Southeast Asia region. We have not yet reached themore than sufficient.

stage of solving social issues or creating new businesses,

Our Group policy is to strive towards further improve-but, in future, we will look to invest in fields that can provide

ments in corporate value by increasing our equity spreadsociety with solutions.

while maintaining awareness of our cost of capital.

Currently, we are working to invest in our business and conwe aim to promote customer digital transformation (DX),of speed required to move forward with new businesses, itworking with customers and partners in various industries togrowth by insisting on producing everything in-house. For

is clear that it will be difficult to achieve a further leap ofcontributing to sustained customer growth. Secondly, we arethat reason, while we consider M&A as one strategic option

promote social DX to resolve social issues. In the field of cap-

for inorganic growth, M&A is, in the end, a means of growth,

ital investment, as we work to expand our outsourcing busi-

and of course the priority must be on ensuring that all M&A

nesses, we are making steady investments, as required, inis consistent with our strategies. M&A requires us to consider

tangible and intangible assets. Our company always sets ana number of different issues including whether the acquisi-internal rate of return (IRR), calculated on the basis of thetion price is appropriate, how we can move forward withcost of capital, to make investment decisions. The rate is not

PMI, including the demonstration of synergies, and how weconstant or fixed. Rather, we consider the risks inherent in

can implement post-merger monitoring and governanceeach individual project, responding flexibly to seek higher

efficiently and effectively. Responding to such issues is notrates of return where we deem risks to be higher.

To achieve our Vision 2030, we are working to transform

system integrator to become a company that provides
Investment Performance

Strategic investment

Investment indeveloping
services

Total

R&D expenses

Capital expenditures (tangible/
intangible)

Capital Investment in people

Management Policies(2021-2023)(FY2021–FY2023)

FY2018FY2019FY2020Total forthree FYs

FY2021

FY2022

4.0

4.5

5.0

13.5

4.1

4.0

8.2

15.1
3.5

10.3

19.0
3.4

2.5

12.0

19.5
3.1

9.7

30.5

53.7

10.0

3.9

9.1

17.1
2.6

3.5

14.7

22.1
2.6

* The International Financial Reporting Standards (IFRS) have been applied as of FY2021. Figures for FY2020 and earlier are based on Japanese generally accepted accounting
practices (J-GAAP).

38

BIPROGY Group Integrated Report 2023

this requires additional expenses in the short term, thesetime, data-driven management. Taking the lead in imple-

corporate asset, and we are still working to transform ourmenting the digital transformation of our own company

human resources and corporate culture to facilitate thealso allows us to build robust know-how that we can har-acquisition and training of human resources capable ofness to deliver services to our customers. We are continu-

producing innovation. In order to achieve further coordi-

ing with this work to ensure that our Group remains

nation between our human capital strategies and corpo-

worthy of being chosen by customers.

rate growth strategies, we established the Human Capital

Our shareholder return policy is based upon connecting divi-

major item on our agenda, and we will be considering how toshareholder return policy, we comprehensively consider fac-

ments and through the acquisition of treasury stock, in theprovide shareholder returns, including through dividend paylight of our investment strategies.

tors such as our cash flow position, and the balance withinvestments for future growth and the business environment.

In April 2022, we changed our company name, and under

Under our Management Policies (2021–2023), we are aiming

our Group’s Vision 2030, we are in the middle of transition-

payout ratio in FY2022 was 39.8%. Over the past 10 years, weand towards becoming a company focused on creating andto achieve a consolidated dividend payout ratio of 40%. The

ing away from our current position as a system integrator

have also achieved stable increases in total shareholder

providing social value. While this transformation cannot

return. Since FY2018, we have increased our dividend payouttake place overnight, we are aiming to build momentum

ratio target from the previous level of 30% to 40%, growing

and further accelerate the process. We hope that all of you,our dividend payments as our business has grown. As weour stakeholders, will look forward to the Group’s further

plan our next management policies, capital allocation is a

growth, and continue to favor us with your support.

Total Shareholder Return (TSR)
(%)

���

Foresight in sight 2020

4.2

initiatives will allow us to take further steps towards real-* PMI stands for post-merger integration, the integration process after a merger or
acquisition.

Mid-Term Management Plan

3.0

has already considered human resources as an important

efits of that investment. For quite some time, our Group���(FY2018–FY2020)(Billions of yen)ing to refresh and upgrade our internal core systems. Whileat all simple, but these are the issues we will carefully tackle
to achieve further Group growth.

our Group, moving away from our previous business as a

combined with the strategies needed to maximize the ben-dends to business performance. When determining ourWhen we take into consideration the resources and sense

outlined under our Management Policies (2021-2023). Firstly,

Furthermore, from FY2022 to FY2023, we are also work-

process requires appropriate investment in human capital

Security”, and “Green Energy”, but we will flexibly change thetargets of our investment depending on the circumstances.

duct research and development from two perspectives assions on our human capital investment strategies.

ately managing and harnessing human capital. This

Shareholder Return

Mobility”, “Healthcare/Education”, “Work/Life”, “Digital/

Strategic investment, R&D, capital investment

next management policies, we engage in repeated discus-

porate competitiveness and value creation by appropri-

fields as outlined in our Vision 2030, “Transportation/

Our future investment is likely to focus on the five major

Investment strategy

responsible for planning and executing our overall human

We believe that an extremely important factor in achieving



BIPROGY



TOPIX

���

���
���
���

�
(year/ ����/�
month)

BIPROGY
TOPIX����/�

����/�

1 year6.9%

5.8%

����/�

����/�

����/�

3 years

����/�

����/�

5 years

����/�

����/�

����/�

10 years

Cumulative

Annual rate

Cumulative

Annual rate

Cumulative

Annual rate

53.4%

15.3%

31.8%

5.7%

142.1%

9.2%

20.5%

6.4%

57.4%

* Total Shareholder Return (TSR): Total return on investment that combines capital gains and dividends.

9.5%

356.8%

16.4%* TSR is calculated with the cumulative dividend amount and share price fluctuation for BIPROGY, and the share price index, including dividends, for TOPIX. (prepared by BIPROGY
using data from Bloomberg and other sources)* The values in the graph are TSR-indexed market prices, taking the closing price on March 31, 2013, as 100 (with a holding period until March 31, 2023)

BIPROGY Group Integrated Report 2023

39

Financial Highlights* The International Financial Reporting Standards (IFRS) have been applied since FY2021.
Financial figures for FY2020 are presented in accordance with IFRS in addition to the existing Japanesegenerally accepted accounting principles (J-GAAP).

(BIPROGY Inc. and Consolidated Subsidiaries)

Revenue (Net Sales)/Operating Profit (Operating Income)/Operating Margin(Billions of yen)

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(FY)

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Mid-Term Management Plan
(FY2012–FY2014)

 Revenue (Net Sales) (left axis)

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Operating Margin (right axis)

Orders by Segment

Operating Cash Flow/Investment
Cash Flow/Free Cash Flow

Research and Development Expenses& Capital Expenditures(Billions of yen)(Billions of yen)(Billions of yen)

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 System Services
 Outsourcing
 Hardware

IFRS

 Support Services
 Software Others

The number of orders received by
BIPROGY in FY2022 continued to increase
not only due to robust demand for our system services, but also due to other factors
including an increase in the number oforders for long-term outsourcing projects.

40

BIPROGY Group Integrated Report 2023

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IFRS

 Net Cash Provided by (used in)Operating Activities Net Cash Provided by (used in)Investing Activities
Free Cash Flow

Our growing profitability is producing stable
cash flow. In addition to the acquisition of
intangible assets, chiefly through investment in software for outsourcing solutions,
we have continued to invest in startups withthe knowledge required to produce innovation and state of the art technology, as we
accelerate the growth of our businesstowards the achievement of our Vision 2030.

(Yen)

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(FY)

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 Basic Earnings (Net Income) per Share (left axis)

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Management Policies(2021-2023)

Foresight in sight 2020

 Dividends per Share (left axis)

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(FY2018–FY2020)

Innovative Challenge Plan����

Mid-Term Management Plan

(FY2015–FY2017)(%)

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(FY2012–FY2014)���.��

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Dividend Payout Ratio (right axis)(FY2021-FY2023)

Since the start of our Mid-Term Management Plan in FY2012, we have consistently improved our profitability by transforming our businessmodels, improving our productivity, and divesting from unprofitable businesses. In FY2022, we paid an annual dividend of ¥80, taking the consolidated dividend payout ratio to 39.8%. In the Management Policies (2021-2023), our policy is to aim for a consolidated dividend payout
ratio of 40%. We strive to provide stable, sustainable profit distribution under a basic policy of paying dividends in accordance withperformance.
* Includes an additional ¥10 dividend to celebrate the company name change to BIPROGY Inc.

Profit Attributable to Owners of
Parent (Net Income Attributable to
Owners of the Parent)/ROE(Billions of yen)

��
��

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(FY2021-FY2023)

Foresight in sight 2020

 Operating Profit (Operating Income) (right axis)

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Basic Earnings (Net Income) per Share/Dividends per Share/Dividend Payout Ratio

Management Policies (2021-2023)(FY2018–FY2020)

Innovative Challenge Plan

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Mid-Term Management Plan

(FY2015–FY2017)

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During the terms of our previous mid-term management plans, we worked to strengthen the foundations of our business by reviewing ourcost structures while improving our risk management capabilities and solidifying our financial position. Through these efforts, we transformed
our business model and improved profitability. Under our Management Policies (2021-2023), we continued to work towards further improvements in profitability, and in the second year of the period (FY2022), we were able not only to take advantage of the growing business in digitaltransformation (DX) related services to make solid progress in expanding our system services, we also harnessed the strong growth in demandfor DX investment to increase our revenue from our outsourcing solutions and support service businesses, as well as the sale of products,
resulting in higher overall sales revenue. Despite an increase in SG&A expenses, we also increased operating profit due to factors including thesales revenue increase and the greater profitability of our system services business.

���Strategies Aimed at Realizing Vision 2030

(FY)

�

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IFRS(%)

Total Shareholder Return (TSR)
(%)

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�

 Research and Development Expenses(left axis) Capital Expenditures (tangible/intangible)(right axis) Profit Attributable to Owners of Parent(Net Income Attributable to Owners of
the Parent) (left axis)
ROE (right axis)

As we work, under our Management Policies(2021-2023), to achieve our goals of continuallyharnessing sophisticated technology and creating innovation, we are strengthening ourresearch and development of services that accelerate DX, new uses for advanced technology, andthe creation of other new services. As we are also
making investments to move our existing businesses forward, the amount we have invested
has increased due to investments in computersand software for our outsourcing services.

Net profit for FY2022 fell due to a fall in
profit from finance income caused by factors including a reduction in valuation gain
on investments in funds. Our Management
Policies (2021–2023) includes a numerical
ROE target of 15%, and the ROE for FY2022
was 15.0%.

Net Interest-Bearing Debts & Net
Debt-to-Equity Ratio(Billions of yen)(Times)

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BIPROGY
TOPIX Total Return Index

Total shareholder return for FY2022 wassignificantly higher than the TOPIX total
return index. The BIPROGY share price hasremained stable over the past five years,
supported by robust businessperformance.

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(�.�)

IFRS

(�.�)

 Net Interest-Bearing Debts (left axis)
Net Debt-to-Equity Ratio (right axis)

As a result of ongoing improvements to
our financial condition, achieved mainly
by reducing interest-bearing debt, the net
debt-to-equity ratio improved to -0.04
times in FY2022.

* Market price based on TSR indexed with closing
price on March 31, 2018 (100).

BIPROGY Group Integrated Report 2023

41

Strategies Aimed at Realizing Vision 2030

Non-Financial Highlights(BIPROGY Inc. and Consolidated Subsidiaries)

Number of Employees (by Gender) & Operating Profit (Operating Income) per Employee(People)��,���

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 Number of Woman Employees (left axis)

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(FY2018–FY2020)

Innovative Challenge Plan

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(FY2015–FY2017)(FY2012–FY2014)

 Number of Man Employees (left axis)

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�,���

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(Millions of yen)

Foresight in sight 2020

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Management Policies(2021-2023)

Operating Profit (Income) per Employee (right axis)(Note) Up to and including FY2020, our reporting was in accordance with generally accepted accounting principles in Japan (J-GAAP), while the International Financial ReportingStandards (IFRS) have been applied since FY2021.

(People)

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Employee Turnover Rate*2��� ������ ��

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 New Graduates (Man) New Graduates (Woman) Mid-Career Recruitment (Man) Mid-Career Recruitment (Woman)

As we work to achieve our long-term vision,
we are prioritizing the recruitment of experienced mid-career hires alongside our new
graduate recruitment. In FY2022, as we
maintained a high proportion of woman
employees among our new graduate hires,
our mid-career hires for the first time outnumbered our new graduate hires.

(Hours)

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Average Monthly Overtime Hours
Worked per Employee*2 & Paid Leave
Utilization Rate*2

(%)

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While our employee turnover rate has been
rising since last year due to the changes in
the hiring market occurring over recent
years, we continue to provide a comfortableworking environment and significant career
growth opportunities to younger employees, helping us to maintain a turnover rate
well below the industry average of 11.9%** Source: Ministry of Health, Labour and Welfare,
Survey on Employment Trends 2022 information andcommunications industry employee turnover rate(%)

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 Average Monthly Overtime Hours Worked
per Employee (left axis)
Paid Leave Utilization Rate (right axis)

We are working to reduce average overtime hours by promoting the efficient, judicious use of overtime. In FY2022, we
exceeded our 80% target for the use of
employees’ paid leave allowance. We continue to pursue work style reforms andsound management of employee health.

(Scope of Calculation)*1 BIPROGY Inc., its consolidated subsidiaries in Japan, and Cambridge Technology Partners Inc. up to and including FY2020. BIPROGY Inc. and eight other companies in FY2021*2 BIPROGY Inc. and UNIADEX, Ltd.

42

BIPROGY Group Integrated Report 2023����,��� ��,�����

(t-CO�e)��,���

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 GHG emissions reduction ratio(comparison with FY2019)（left axis）
 Scope1+ Scope2 Total volume ofemissions（t-CO2e）(right axis)�

We are working to reduce greenhouse gas
emissions by increasing our procurementof energy from sustainable sources, reducing our office space usage, and employing
other energy-saving measures including aswitch over to more efficient devices.

Percentage of Employees with
Disabilities*5(%)

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(%)

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Reduction Rate in GHG Emissions /Scope1+ Scope2 (market based)
Total Volume of Emissions*3(FY)(FY2021-FY2023)

Since the Mid-Term Management Plan (FY2012–FY2014), we have been focusing on reforming our personnel system and human resource development as a priority issue, and implemented various measures such as dealing with promoting work style reforms and improving productivity.
Until now, the number of employees has continued to decrease for several reasons including the retirement of baby boom generation employees, but we are conducting recruiting activities and implementing human resource development measures from a medium- to long-term perspective in an effort to secure and train diverse human resources who are able to think self-reliantly and generate innovation. As a result,operating profit per employee has been steadily increasing even as the decreasing number of employees began to increase again in FY2019.

Number of New Employee Hires*1

Material Issues-Related Major KPIs

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Pages 24-25, “Material Issues, Overview and Progress”

Supply Chain Communication*2
(%)

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(%)

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Percentage ofPercentage ofmain suppliers for
initiation of actions,�� which an ESG risk assess- such as requests for action
made to main suppliers
ment has been made

��

(FY)

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100%
����

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Up until FY2020, we conducted surveys ofour suppliers’ level of understanding of the
Procurement and Transaction Guidelines.
In FY2021, we conducted an ESG risk
assessment of all major suppliers, and in
FY2022, we acted on the results of thatassessment through measures including
requests for improvement.

Weighted Average Score of Work Style
Related Items in the Engagement
Survey
�

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�

�

(FY2022) Level of Understanding of the
Procurement and Transaction Guidelines

�.��

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100%

(FY2021)����Percentage of Management Positions
Held by Women*4

(FY)

(FY)

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Percentage of employees with disabilities
Legally required percentage

Our group’s goal for the recruitment of persons with disabilities is to exceed the legallyrequired percentage by 0.1% or more, andwe have achieved this goal for the past six
years. By strengthening our policies for thehiring of persons with disabilities and providing support for the organizations in which
they work, we strive to provide a comfortable working environment for all employees, irrespective of their circumstances.

(FY)

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Number of Serious Security
Incidents*6(Incidents)��.�� �.�� �.�� �.��

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As an important part of our diversity policy,
we aim to ensure the woman employees
are well represented throughout our organization. In FY2022, the proportion of woman
executive employees was 9.3%, below thetarget (target date: April 1, 2026) of target of
18% or higher as set out under our MaterialIssues. We continue to work towards theachievement of this target in line with ourplans for appointing woman managers.

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The FY2022 score was 3.47, which exceeds
the KPI standard score of 3.36 (the averagefor FY2019 and FY2020) as set out under
our Material Issues. This score has
increased for three consecutive years due
to factors including the influence of telework. We will continue to analyze andrespond to the results of the survey toensure that employees can feel the benefits of our evolution in working practices.

(FY)

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In FY2022, the social reputation of ourcompany was greatly impacted by an incident involving the loss of USB flash drives.
Following this incident, we have taken various steps to prevent further incidents
from recurring.
Further Improve Integrity

P.70-72*3 Data from FY2018 to FY2019 is for BIPROGY Inc. and 10 other companies and two other organizations (major offices in Japan); Data for FY2020 is for BIPROGY Inc. and 12 othercompanies and 2 other organizations (major offices in Japan).
Data for FY2021 is for BIPROGY Inc. and 24 other consolidated companies (major offices in Japan and abroad) excluding limited partnerships for investment.
Data for FY2022 is for BIPROGY Inc. and 25 other consolidated companies (major offices in Japan and abroad) excluding limited partnerships for investment.
*4 Data prior to FY2020 is for BIPROGY Inc. and UNIADEX Ltd. Data from FY2021 onward is for BIPROGY Inc. and six other companies.
*5 Data prior to FY2019 is for BIPROGY Inc. and UNIADEX Ltd. Data from FY2020 onward is for BIPROGY Inc. and six other companies.
*6 Data prior to FY2020 is for BIPROGY Inc. and wholly owned Japanese subsidiaries of BIPROGY Inc. Data from FY2021 onward is for BIPROGY Inc. and its consolidated subsidiaries.

BIPROGY Group Integrated Report 2023

43

Implementation Capability for Realizing Vision 2030

Dialogue between the CEO and Outside Directors
recommended that a rigorous investigation be conductedby a third-party committee.

In response, internal directors provided detailed reports

at board meetings over the past year, and met with us inseveral roundtable discussions. We were also provided

with opportunities for individual discussions with auditorsand members of the Group Internal Audit division. I feelthat the management team’s united and continuous dis-cussions, not only immediately after the incident but overthe course of the year, were valuable in putting in placeessential measures to prevent recurrence.
Advani

I agree. I believe that this incident has provided

an opportunity for our Group, which is primarily engaged

in IT and digital businesses, to rethink our position about

Yoshinori Ikeda

Chie Sato

Akiyoshi Hiraoka

Nalin Advani

Asako Osaki

Yoshinori Ikeda has accumulated
experience in serving the National
Tax Agency at important positions
for many years. He has overseas
experience, and he is well-versed
specifically in the field of international taxation. He has sophisticated professional knowledge andexpertise in the field of tax
accounting. He has been in his
current position since 2022.

Chie Sato has abundant management experience and expertise as
evidenced by her numerous
books about business schools in
the United States. Furthermore,
she played an active role as amanagement strategy consultant
in the Boston Consulting Group.
She has been in her current position since 2017.

Akiyoshi Hiraoka joined Nippon
Univac Kaisha (now BIPROGY) in
1980. He has been in his current
position since 2016.

Nalin Advani possesses global
business experience mainly basedon the Asia Pacific region as wellas technical expertise about AI
and robots after having served
multiple technology companies
mainly in Japan, Singapore andIndia in business management
and investment-related roles. He
has been in his current position
since 2021.

Asako Osaki has extensive international experience, including work at
the United Nations. She is also active
as an expert on gender in various
fields such as government, local government, and academia. Also, she has
sophisticated professional knowledge
and expertise not only in the field ofgender, but also in the field of ESG/
sustainability. She has been in her
current position since 2023.

Director (Outside Director,
Independent Director)

Director (Outside Director,
Independent Director)

Representative Director andPresident CEO, CHO

Director (Outside Director,
Independent Director)

Director (Outside Director,
Independent Director)

The Future that the BIPROGY Group Envisions

President Hiraoka and the four independent outside directors held a dialogue on issues that the BIPROGY Groupshould address, and the role of the Board of Directors in solving social issues and creating social value.

Looking Back at FY2022
Hiraoka

Today, I would like to ask our outside directors fortheir candid opinions on how the Group’s Board of Directors
should be, how discussions are conducted, and what isneeded to create further value. Ms. Osaki, you were appointed
as an outside director in June 2023. First, could you sharewith us your opinion on the role required of outside directors?
Osaki

As an outside director, I believe what I can do isprovide the board with the perspectives of all kinds ofstakeholders. I have worked for international organizations
and am now in a position to communicate stakeholders’HiraokaThank you for your important perspective. Our

datory in 2022, requiring companies to visualize and correct
their hidden indirectly discriminatory structures. I would

like to identify what issues lie behind the wage gap between
BIPROGY Group Integrated Report 2023

high level of security, so that we can guide our customers
in their use of technology.
Ikeda

The entire company really focused on understand-ing the actual situation and examining and promoting

ture in which people have diverse values within them-selves, not limited to gender, and understand each other’svalues and the environment in which they are placed.

At board meetings in FY2022, the outside directors pro-on measures to deal with the loss of USB flash drives.

We are always aware that we are only midway

Ikeda

Two years have passed since the Group’s material

issues were formulated. I view the goal-setting process andinitiatives as very well organized, unique, and commend-

able. However, the overall impression of the company may
improve corporate governance and integrity” due to theloss of USB flash drives.

For its board of directors, the company shows a clear

numbers of outside directors and women directors. I feelers free and vigorous comments from diverse viewpoints.
Goal setting and initiatives formaterial issues are very wellorganized, unique, andcommendable.
Yoshinori Ikeda

through our efforts regarding measures to prevent recurrence, and we must continue to deal with the situation

seriously without letting the memory fade. After this inci-

Advaniseparate group, thoroughly discussed the nature of thisa constant effort to spread them throughout the entire com-dent occurred, we four independent outside directors, as aproblem and specific remedial measures. We strongly

Currently, the use of portable media is prohib-

ited as a general rule. But, if it must be used, a strict system
is in place whereby permission is granted as a special caseonly after evaluating the necessity and risk and determin-

ing that appropriate safety control measures can be taken.
Currently, we are striving to become a company with theworld’s highest level of information security and the ability
to form world-class alliances with partner companies, andour employees share this goal. In the future, we will con-tinue our activities so that we can become a company thatcan continuously review its operations as a matter ofcourse, not as a special exception.
We are striving to achieve theworld’s highest level of
information security, and our
employees share this goal.
Akiyoshi Hiraoka

Current Assessments and Challenges for the BIPROGY Group

that the executive management fully accepts and consid-

require employees to have multiple roles. We foster a cul-Hiraoka

ing discussions. The company is also making importantthe concept of “ROLES” into our personnel system andof innovation lies in diverse values, we have incorporated

redevelopment of rules regarding sub-contracting.

measures to prevent recurrence, including in board meet-

intention to increase diversity by, for example, raising theSatoon the wage gap between men and women became man-responsibilities in handling information, and achieve aGroup values diversity. Based on the belief that the source

ments, local governments, NGOs, local communities, andMy specialty is gender issues. Disclosure of information

44

men and women and contribute to closing that gap.

vided a great deal of advice from their respective perspectives

university students.

acquiring information increase, we must be aware of our

be lowered because it cannot be rated highly for “Further

perceptions of issues and requests to companies throughcollaboration with various stakeholders, including govern-

how we handle information. As cyber attacks aimed at

improvements for the future, such as a general review andMany companies seem to end up merely establish-

ing their material issues and vision, but in our Group there ispany. In addition to disseminating informationcompanywide, the president and the entire management
team are using company-sponsored events and internalaward ceremonies as opportunities for communication andlistening to reactions from employees. This reassures me thathigh-quality communication is being continually promoted.
Sato I agree. I also believe that we are steadily achieving
our numerical financial targets, which is a commendable

achievement. At the financial results briefing in April 2023,

President Hiraoka revised the initial plan and indicated that
the Group would focus more on social DX. I think it is very

important for IT companies to flexibly change their strate-

gies according to market conditions in this way. I believe thetime has come to promote strategic investments, such as abolder M&A strategy. I would like us to learn a lot from contingencies such as the global Covid-19 pandemic and theloss of USB flash drives, and draw up growth strategies forthe spans of the next 5 and 10 years.

I recognize that the key issue today is human capitalmanagement. The average age of our Group is higher thanthat among our competitors, and we must consider how tocreate opportunities for both senior and younger workers.

More and more these days, reports to the Board of Directors
are not made by the supervising director, but by the personor the officer directly in charge of the project. This is a goodinitiative from the perspective of developing management

BIPROGY Group Integrated Report 2023

45

Implementation Capability for Realizing Vision 2030

Dialogue between the CEO and Outside Directors

talent, and it also helps outside directors understand whatkind of people the company has.

I would like us to learn a lot
from contingencies and draw
up growth strategies for thespans of the next 5 and 10 years.
Chie Sato

There is an international trend for decisions madeOsaki

at international conferences such as the G7 to quickly leadto policies and laws in various countries. One example washuman rights due diligence in the global supply chain two
years ago. Attention to diversity, equity and inclusion(DE&I) has also been particularly strong, and theInternational Organization for Standardization (ISO) is

Hiraoka

rapid international movement. It seems to me that our

resource development.

important for management decisions to respond to theGroup is identifying the necessary human resources andanticipating the future of our society to put these

responses into practice with foresight and insight, as
stated in its Purpose.
Hiraoka

The directors on the executive side are also con-sidering many things, but I still believe that some perspec-

The Group has incorporated performance-linked

remuneration in the non-financial aspects of executive

remuneration since FY2021. The underlying concept is that
directors appointed by shareholders, including outside

directors, must generate medium- to long-term benefits

for all stakeholders and society. This approach is consis-

tent with sustainability management. I think it is excellent
that the skill matrix of directors is disclosed and their
expected functions are visualized.
AdvaniI concur. I feel that our Group achieves maturecommunication between adults. I’m proud to say that few
companies of the same corporate size have assembled adiverse group of directors with such diverse backgrounds.
What we need to consider in the future, however, is building a talent pipeline. The Group is proactive, and the factthat everyone attending board meetings as an observer,
for example, is asked questions and asked for opinions,helps to develop the talent pipeline.

Nalin Advani

The great strength of our Group is that we have gath-ered a body of truly serious and sincere employees. In line

46

BIPROGY Group Integrated Report 2023

employees are aiming for the same place”. I believe this is
proof that our employees are taking on the challenge ofmake proposals which are followed up by veterans in their50s, and I am proud to say that we have many employeeswith high followership skills. We will realize our Vision 2030
by demonstrating our capabilities as a team.

Board of Directors then applies further deliberation andety is population decline. Economic activity will shrink astives and sometimes send it back for further revision. The
revision from diverse perspectives, resulting in a higher

quality of debated items. I believe that providing aware-ness will become an even more important role for outside
directors in the future.

Osaki

The biggest sustainability threat to Japanese soci-the working population declines, making it difficult tomaintain infrastructure and social security. Part of the rea-son for this is still the gender gap. In rural areas, the exodusof young women to urban areas is accelerating population
decline. Nationwide, the number of young women who

would ideally want to work in a double-income family but
in reality expect to remain unmarried (i.e., continue working while unmarried for life) is rapidly increasing.

I believe that digitalization will play a role in solving thiswith the slogan “From customer DX to social DX,” I can recog-

problem. Even in rural areas it will become increasinglytion of Vision 2030. In particular, I have the impression thatthat enable people to find rewarding jobs. There must also be

nize that we are making steady progress toward the realiza-

our employees are very good at the E (Environmental) and S(Social) parts of ESG, which I believe is linked to the creationof various businesses that lead to solutions for issues.

However, I feel that, as Director Advani said, there are chal-lenges in building the talent pipeline and in DE&I. Although I
have provided advice from the perspective of a former

important to have IT skills and remote work environments
networks and social infrastructure so workers can support
each other, services to ease the burden of housework andchildcare, and other perspectives to solve Japan’s sustainability issues through technology. We need to think about

how we can use digital technology to close the gender gap.

employee of a global company, including objective data on

The perspective of using
technology to solve Japan’ssustainability issues will
become increasingly importantin the future.

the levels of global standards and the dangers of highly uniform organizations, I believe that the Group’s efforts are stillinsufficient in some areas. All four independent outside

directors have studied at graduate schools abroad and haveextensive global experience, so we would like to recommend

Asako Osaki

initiatives and global standards of governance that go a stepfurther than those of other Japanese companies.
Osaki

I wholeheartedly agree with Director Sato about

DE&I and global standards. Returning to the subject of theimportant, and it must be examined using a number of indicators. In the case of Japan, for example, to see where thebottlenecks for promotion lie, it is necessary to analyze indicators such as the ratio between men and women among

those who use the childcare leave and shortened working
hours systems, and among those receiving domestic andSato

The other day, a client said to me, “All BIPROGY Groupvalue. In our Group, young employees in their 20s often

thoroughly deliberate its contents from different perspec-of Directors, the Executive Council and each committee

gender wage gap, the analysis of the factors behind it is very
What we need to consider inthe future is building a talentpipeline.

things that need to be addressed in terms of human

how to create social value and balance it with economic

To Improve the Value Provided by the BIPROGY Group and to Achieve
Sustainable Growth

tives are missing. Before an agenda item goes to the Board

Initiatives to Develop Human Resource and Build a Talent Pipeline
Ikeda

From your comments, I feel that there are many

currently developing gender equality guidelines, making it

overseas transfers and single-person transfers. I believe that
exploring and analyzing the nature of the gender gaps in
our Group will also help us build our talent pipeline.

Hiraoka
Ikeda

This is exactly in line with our Group’s Purpose.

In order for our Group to achieve sustainablegrowth in the future, I believe we must further promote
globalization by focusing our efforts outside of Japan,
including through M&A. In addition, because of theextremely fast pace of innovation in the IT industry,

improving and accumulating human capital will be key. Asan outside director, I will focus on providing an objective
perspective and advice based on my expertise, and on
ensuring discipline in processes and procedures.
Advani

In talking with President Hiraoka, the word “asset”

often comes up. Human resources, as well as products andtechnology, are important assets for our Group, and inareas where we lack those things, we need to consider conducting mergers and acquisitions to build our assets. I

believe it is time to put our balance sheet to good use. In

addition, over the past few years, we have been tasked withvisualizing various things, such as the skills of our humanresources, but visualization is not the goal. I look forward toseeing our people using their brains and technology to

improve their skills, to become human resources who cancontribute to the company and society in the future. I personally hope to apply the expertise I have accumulated in

my own business and other areas to the Group’s initiatives.
Sato No one can predict what will happen in the future,in say 2030 or 2050. It is important to be ready to deal withwhatever the future brings, and to do so, we must objectively recognize our strengths. And I believe it is the
responsibility of outside directors to convey thesestrengths objectively. In addition, our profitability is

steadily improving, and I can see that it is time to move onto the next stage of the Group’s growth strategy. With therapid evolution of AI, we in the IT industry must consider“what kinds of work only humans can do” before building
strategies and expanding the scale of our sales. My desire
is for the company to reach the next level in aspects suchas sales volume, profitability, diversity of human resources,
governance, and sustainability management. To that end, I
will continue to contribute to the growth of our Group as
an outside director member of the Board of Directors,

while proactively sharing information such as outstanding
examples from global companies.
Hiraoka

As Drucker says, the best way to predict the

future is to create it. When we formulated our Purpose, we
also changed the name of our company, because we feltthat in order to solve social issues and create social value,

we should think borderlessly rather than globally. As statedin our Group’s corporate statement, “Foresight in sight,” wewill work toward 2030 and 2050 by dreaming of the kind ofworld we want for the future and envisioning the society

we want to create. And in our next management policies,
we will aim for the next higher level, as you mentioned.

BIPROGY Group Integrated Report 2023

47

Implementation Capability for Realizing Vision 2030

Intellectual Asset Strategy
Material Issues

Create schemes to solve issues through the use of digital technology and business ecosystems

The BIPROGY Group has worked to bring the Digital Commons to the world by combining its track record

Utilization of Data/AI

Our Group develops and delivers various services based on
the concept of “solving corporate and social issues throughdata analysis and AI technologies,” and aims to enhance datautilization in an era of VUCA.
In the field of generative AI, we intend to develop a differentiated business by leveraging our expertise and intellectual property in Natural Language Processing, which our Group has beenworking on for many years. Many companies and government
agencies are considering the use of this technology due to
expectations for its convenience, such as increased businessefficiency and business sophistication. However, a certain levelof skill is required to effectively use it, such as knowledge of generative AI and judgment of its suitability for a job. In addition,
concerns and risks associated with the use of AI, such as leakageof confidential information and violation of privacy and rights,
must also be addressed. In February 2020, the Group formulated
the “BIPROGY Group AI Ethics Principles,” followed in April 2023
by our “Guidelines for the Business Use of ChatGPT and Other
Generative AI .” We are actively working to apply generative AI to
our own operations, and to deliver services to our customers.

and expertise in solving social issues with a network of like-minded people, plus digital technologies

founded on many years’ experience. By doing this, we hope to create both social and economic value andpursue sustainability for the environment, society, and the BIPROGY Group as a whole.

Toward the Realization of Customer DX and Social DX

and our accumulated intellectual property, with open

Over the years, our Group has earned the trust of its cus-innovation in Japan and overseas.

tomers through the provision of ICT infrastructure and sys-

Furthermore, by promoting corporate DX that contrib-

tem services. Today, we contribute to our clients’ DX bycreating new services and solutions using technologies

utes to the sustainable growth of our customers and accu-

AI. We will transform our customers’ business models by

works together with our customers and partners to solve

mulating best practices, we aim to realize social DX thatthat are evolving every day, such as cloud computing andsocial issues.

combining our experience in providing system integration
services to customers in various industries and sectors,

Flexible corporate
culture for change

Maximizing
customer value

Solving social issues through DX

Improving employee
satisfaction

Preserving social
infrastructure

Business
ecosystem

Community
revitalization

Carbon neutral

Business automation/efficiency
enhancement

Workstyle reformand culturaltransformation

Product and service development
transformationize the digital commons, in R&D, we are continuously

Value creation
through data linkage and utilization

DX-enabling technologies

Low code/No code
Digital twinsCapital Investment

Observability/Monitoringand operations

ModernizationService design/UI/UX

we need for reforms of corporate culture and structures.

We will take the opportunity presented by our company

in the world through aggressive investment, including

Investment strategy set forth in Management Policies (2021-2023)

Cloud/Edge Computing

Security/Authentication/
Zero trust

Agile/DevOps

promote investments in the human resources and internal IT

M&A, both in Japan and overseas.

R&D

AR/VR

capital investments to strengthen outsourcing services andgies, and service development and technology enhancement



Blockchain

https://www.biprogy.com/com/ai_ethics_
principles_BIPROGY_group.pdf

name change to BIPROGY Inc. to establish a unique brand

Automation/robotics

BIPROGY Group’s AI Ethical Guidelines (Japanese only)

deep understanding of customers and their industries,

Strategic Investment

IoT/sensorsservice-based businesses. In addition, we will continue tonology and create innovation on a sustainable basis. To real-AI data analysis andutilization

A service for building environments to use ChatGPT for enterprises. We use Azure OpenAI Service to accompany and support
our customers in the building of secure generative AI environments, and in the creation of use cases for their generative AI.

accelerate strategic investment to utilize cutting-edge tech-

Logistical
efficiency
improvement

Azure OpenAI Service Starter Set Plus

to accelerate service-based businesses. We are also making

sure in our Management Policies (2021-2023), and we will

research and development based on cutting-edge technolo-

Business transformation through DX
Evolve marketingand demand
forecasting

A service that supports the promotion of consumer purchases andbehavioral change by using data and
AI to appropriately segment consumers and provide promotional
measures suitable for each segment.

Our Group has positioned investment strategy as a key mea-

investing in service development to accelerate DX based on a

Customer channel
development throughCX transformation

RinzaTarget

Acquiring and Enhancing Advanced Technologies to Realize
the Digital Commons

BIPROGY Group’s Structure of DX
Enhancing corporate value through DX

Examples of our services

Structural Reform Investments ontinue to invest in and collaborate with startups with innovative technologies not restricted toC
the ICT domain, in order to promote solutions to social issues from a medium- to long-term
perspective.
Ambitiously search for and execute M&A opportunities.

Promote investments to launch co-creative new businesses*.

 trengthen service development to accelerate DX based on deep understanding of the industry
S
and customers.
Strengthen R&D based around cutting-edge technologies.

Strengthen service development and technical capabilities to accelerate service-based businesses.
Continuously invest in outsourcing and service-based businesses.
Human resource reforms to acquire new capabilities.
Policies for new flexible workstyles.

In-house reforms for further digitalization of business (promotion of in-house DX).

* Formation of business and capital alliances to establish joint business entities and expand their business with an aim to build business ecosystems with external companies.

48

BIPROGY Group Integrated Report 2023

BIPROGY Group Integrated Report 2023

49

Implementation Capability for Realizing Vision 2030

Intellectual Asset Strategy
Strategic Investment

Our Group is engaged in a variety of open innovation activities with the aim of forming and expanding business eco-with diverse professional skills through personnel
exchanges with outside companies.

In the field of investment in startups, we are actively

systems with startups in Japan and overseas. We use ainvesting in areas that are having increasing social impact,

ups, as well as supporting advanced technology ventures.

generative AI, and in the logistics industry, where issues

variety of channels to build connections with many startIn addition, we are actively developing human resources

such as the SDGs and wellbeing, in areas of focus, such as
such as labor shortages need to be resolved quickly.

Creating value through technology and innovation and investing in the further growth of the BIPROGY Group
Open Innovation Activities

Global Strategy







 ormation and expansion of business ecosystems withFdomestic and international startups.
 ultivation of diverse professional human resourcesC
through active exchanges with external organizations.

Startup Investment
I nvestments in businesses such as start-ups: 71
Investments in funds that target diverse fields both inJapan and overseas: 31
(as of March 31, 2023)

S trategically invest in areas of growing social impact, such as SDGs
and wellbeing, as well as in areas of focus, such as generative AI.

Strengthen and expand our global business foothold in ASEAN.
 dd two companies to expand our lineup of solution offeringsAthrough collaboration between the three companies.
Provide SAP solutions in
Singapore and Malaysia

Existing
company

Two new
companies

Provide SAP Solutions inThailand orm a capital and business alliance with Hacobu, Inc. toFsolve social issues in the logistics industry.

Provide ERP solutions for
SMEs in Singapore

No.1* Market Share in Truck
Reservation Reception System Service
Used by 420,000 Cumulated Drivers* “FY2022 Smart Logistics Solution Market—Current State and Outlook,”
Deloitte Tohmatsu MIC Research Institute, https://mic-r.co.jp/mr/02560/(Japanese only)
Truck Reservation Reception System Service Market Share

Support local and Japanese-affiliated companies in Southeast Asia to expand their business and achieve global governanceAs companies promote DX, the ERP solution market is expanding in overseas markets as well, as companies seek to improve
management efficiency by centrally managing core business
operations. For Japanese companies expanding overseas,visualization of management information at local sites andtimely management decisions are also important issues. In
2019, we acquired Axxis, a provider of SAP solutions in
Singapore and Malaysia. We also made Nexus System
Resources Co., Ltd. (Thailand), a provider of ERP solutions,
into a Group company in January 2023, and AFON IT Pte. Ltd.
(Singapore) and its subsidiaries into consolidated subsidiaries
in April 2023, thereby establishing an ERP business structure in
Southeast Asia.
We will continue to further expand and strengthen our ERP
solution deployment regions and product lineup, and develop
a system that can provide support from both Japan andSoutheast Asia. In addition, by supporting the overseas expansion and business development of Japanese companies andDX of local companies, we will create a business ecosystemthat solves social issues, and establish a position as a global
company that implements a digital commons in society. We
also intend to grow our overseas business into one of thepillars of our Group’s earnings by 2030.

50

BIPROGY Group Integrated Report 2023

Southeast Asia Business Sites

Netmarks Vietnam
USOL Vietnam

Netmarks (Thailand)

UEL(Thailand)

Axxis
AFON IT

Nexus

Netmarks
Philippines

Jatis Imagineering
Philippines
Solutions Exchange
Telly Systems

R&D and Capital Investment

 Promoting in-house DX

ate service-based businesses and to strengthen our tech-ship of the CDO (Chief Digital Officer) and CIO (Chief

Our Group invests in R&D to develop services that accelernological capabilities. In order to provide attractive

outsourcing services that meet market needs, we need toconstantly invest in upgrading functions, creating a virtu-

ous cycle that increases profits while we invest. With regard
to capital investment, we will execute appropriate invest-

ments to respond to the expansion of outsourcing services.
R&D Investment Themes and Main Examples
Theme

Developmentof services,
products, etc.

R&D of newtechnologies
R&D of fundamental andadvanced
technologies

Main examples• We have developed and launched delivery of the
DIVP (Driving Intelligence Validation Platform), a
platform for evaluating automated driving
safety, which is the result of research conductedunder the Strategic Innovation Program (SIP)
Phase 2 “Automated Driving (Expansion of
Systems and Services)” of the Cabinet Office.
• Forecasting social changes and technology utilization in the future and developing a search
map for cutting-edge technologies; researching
technology trends and exploring business
opportunities; and developing, evaluating, andoperating an overall technology portfolio.

• R&D of social system architectures that serve as
blueprints for increasingly sophisticated social
systems that cut across fields and industries,
built on systems engineering.

Restructuring Investment

We are working on human resource reforms to acquire anddevelop people who will create new social value, and on workstyle reform to create organizations and workplaces where

diverse human resources are empowered to maximize theirabilities (see “Human Resource Strategy” on pages 56-59). We
are also working to expand our business ecosystem together

with partners and communities by promoting both DX for customers and DX for society, as well as internal reforms (promoting internal DX) to further digitalize our business.

We are advancing our internal IT strategy under the leaderInformation Officer). In the reorganization of system inte-

gration-type development, which has been our core business, we have established R&D functions within our

Engineering Division for increasing the sophistication of
traditional outsourced development, applying DX, andconducting product development. In addition, we use avariety of ICT tools (business-critical systems, cloud-first
office applications, mobile-first, web conferencing sys-tems, corporate social media, etc.) to promote communication and improve productivity, and to create work

environments conducive to the creation of innovation. We
are building a seamless network based on the zero trust
concept, introducing cloud storage with high-security

functions to make it easier to find sources of intellectual

property, and promoting the computerization of internal

review processes and the introduction of electronic signature services.

In addition, from FY2022 to FY2023, we are working on

BPR (Business Process Reengineering) for business pro-

cess improvement, BPM (Business Process Management)
environment construction for ongoing business reform,and core system renewal to support data-driven manage-

ment. We accelerate the modernization of conventional IT
systems and the DX of core business operations by developing the foundations of the IT systems that will support

our future business. Then, by using the knowledge gained
there as a practical reference, we are accumulating theskills and experience to realize DX for customers and DX forsociety.

• Evaluation from outside the company

In June 2022, the company was selected by the Ministry of
Economy, Trade and Industry, the Tokyo Stock Exchange,

and the Information-technology Promotion Agency, Japanas a “Noteworthy DX Company 2022” in Digital

Transformation Stock Selection (DX Stock) 2022.

Axxis

Netmarks
Indonesia

Netmarks Singapore

Firium Solutions Asia Pacific

Indivara Sejahtera Mandiri
Jati Piranti Solusindo
Jatis Mobile

 ERP implementation consulting
 Network integration
 Software development and sales
 Systems integration and platform business

BIPROGY Group Integrated Report 2023

51

Implementation Capability for Realizing Vision 2030

Environment
Contribute to the environment through the use of digital technology and reduce the environmental impact
of business activities in order to help build a world of net zero emissions
Sustainably procure and provide safe, secure products and services throughout the entire value chain

The BIPROGY Group contributes to the environment through digital technology. We promote collaboration and cooperation in the transition to a low-carbon society through providing services that facilitatecarbon neutrality and the circular economy, and through the digital commons that the Group has built

and in which it participates. At the same time, we are strengthening measures to reduce greenhouse gas(GHG) emissions in order to reduce the environmental impact of our business activities. Through these
efforts, we aim to contribute to the early realization of a net zero emission society.

BIPROGY Group environmental management
There is growing concern about threats to the foundations ofEnvironment management systemecosystems and safe access to water is endangered for multi-

tal management system, the management foundation, we

survival of current and future generations as the stability ofple reasons, including more severe weather-related disasters
caused by global warming. In the international community,
net zero emission initiatives to make effective use of

Having built an ISO 14001–compliant Group environmenare integrating it into our Environment Contribution
Committee activities.

resources and eliminate the environmental burden so as toParticipation in initiatives

erating, and there is greater interest in increasing biodiversity.

in our Long-Term Environmental Vision 2050, we recognize

achieve carbon neutrality by the mid-21st century are accel-With the goal of mitigating and adapting to climate change

and establishing a circular economic system, we have beenstrengthening our environmental management. Based on

our Long-Term Environmental Vision 2050 and Vision 2030,

we are aiming to realize a net zero emission society by reducing GHG emissions in our business activities and contribut-

As for realizing a net zero emission society, which we toutthat engaging with various stakeholders is indispensable.

Based on that realization, we have not only endorsed TCFD
recommendations and joined RE100, but also actively participate in various partnerships and initiatives, such as GX
League and Green x Digital Consortium.

ing to the environment through the provision of services toStrategy (response to climate–related
opportunities and risks)

exceeds the impact of the risk of greater expenses.

important management issue that affects corporate value

ment into the Group’s various strategies and risk manage-

appropriately reflecting the results of the impact assess-in many ways, and recognizing that it is important to have ament. Furthermore, we are accelerating initiatives tostrategy and the flexibility to respond to changes in uncertain circumstances, we are working to mitigate climate-

related risks and expand opportunities. Since 2021, we have
not only promoted material issue-centered initiatives but

despite the increase in business expenditures related tosuch activities as the development and innovation of tech-

nology to transition to decarbonization and introduction of
resources to create new businesses, the impact of greater
opportunities through the provision of technology andservices that meet needs to solve climate-related issues

Customer
DX

Comprehensively support initiatives
to reduce GHG emissions

Provide optimized proposals and services thatmatch customers’ goals and issues

Promoting the creation of new services and various business alliances

related to environmental contributions, designing mecha-

issues, has overall responsibility for the Group’s initiatives
that contribute to sustainable development goals (SDGs)
and the Group’s sustainable management strategy. The

nisms to promote environmental contributions, and managing and supervising the implementation status.

Long-term performance conditions, including conditions

CSO also regularly reports on the Group’s sustainability

related to climate-related response, were incorporated into

Board of Directors (2 times in FY2022), which provides anLong-term performance conditions KPI related to material

activities, including response to the climate change, to theopportunity to receive supervision and instructions.

As for the Group’s response to environmental issues, includ-ing climate change, related issues are deliberated and decided
upon at the Sustainability Committee, the decision-making
body chaired by the CSO, or its subordinate body the52

Contribution Committee is responsible for examining policies

BIPROGY Group Integrated Report 2023

the executive compensation system introduced in June 2021.
issues include ESG indicators, such as GHG emissions reduction targets, which are material issues KPI for achieving

Vision 2030. The Board of Directors decides on compensation
following deliberations based on reports by the Nomination＆ Remuneration Committee, an advisory body.

ate business opportunities that contribute to the solutionof social issues, including climate-related issues, and capture earning from those businesses. We think that it isimportant to disclose information reliably, make strategic
investments, and further strengthen human capital toenhance technological capabilities in order to make theseclimate-related opportunities more sure.

Visualize

ReduceLogistics DX

Collection and visualization ofdata on production facilities,
warehouses and inventorySocial DX

Promote the realization of societywide carbon neutrality

Introduced the SaaS-type environment value
management system Re:lvis (November 2022)

Contributing to the realization of a carbon neutral society through support for thepurchase of non-fossil fuel energy certificates and improved management efficiency
Environmental value
management services for
consumers and intermediaries

OffsetFacility and energy
management

Board of Directors who is responsible for climate-related

The Chief Sustainability Officer (CSO), the member of thesociety. By cultivating businesses within a larger frame-

Developing businesses that link DX for customers to the advancement of DX for society in order to achieve carbon neutrality

Manufacturing DX

Environment Contribution Committee. The Environment

In Management Policies (2021–2023), the Group iswork that encompasses society as a whole, we aim to cre-Committee activities. In the analysis results up to now,

Support the promotionof a plastic-free society

Governance Related to Climate Change

carbon neutrality and circular economy.

pany-wide projects as part of Environment Contribution

issues, we are moving forward with such initiatives as coop-

Climate change initiatives

tribute to the solution of climate-related issues, such as
moving forward with both DX for customers and DX forpart of the climate-related scenario analysis, based on com-

participates in. In addition to initiatives centered on materialtion to raise employees’ environmental awareness.

develop and provide new products and services that con-also continued to conduct impact evaluations, which arecustomers and digital commons that the Group creates anderating with customers and partners and conducting educa-

We will increase the effectiveness of material issues by

The Group believes that addressing climate change is an

Use and Produce
Green Energy

Distributed power/
microgrids

Solar power PPA

Intermediary
Net Zerobusiness
Emission Ratefunctionsmanagement

Functionforcustomers

Functionsfor electricity retailers

Non-fossil value
trading market
Japan ElectricPower Exchange

Material Issues

Reduce emissions through the use of environmental value assignment
Equipment
investment

Manufacture

Visualize / Analyze

Distribution /Logistics

AI

Re-use /Re-distribute

Risk Management

climate-related risks identified in climate change scenario

risk management system and manage those risks. The Risktance to the Group’s business were registered as subject to

We have integrated climate-related risks into the GroupManagement Committee, which provides unified management for the system, created a risk classification system,

the common management foundation that makes it possible to ascertain Group risks in an integrated manner, andadded climate change risk to the system. Of theanalysis, items that were evaluated to be of high impor-management. The Group’s risk management structure andprocesses are clearly detailed in Risk Management

Committee and Business Continuity Project Regulations

and other related regulations, and are widely disseminatedwithin the Group via the intranet and other means.

BIPROGY Group Integrated Report 2023

53

Implementation Capability for Realizing Vision 2030

Environment

Identification of business opportunities and risks through climate change scenario analysis (impact assessment)
Changes in the environment and society due to transition to carbon neutrality by 2050, which is assumed in the impact assessment based on climate change scenario analysis, and used scenario (common opportunities and risks)• 1.5°C: Various policies and regulations related to climate change strengthened, including emission controls. Dramatic growth in markets
related to solar and wind power and battery industries by 2050 as the weight of electricity in final energy consumption increases. (IEA
NZE2050, RCP1.9)• 4°C: Climate change undermines stability in the international order. Greater risk of economic crisis due to market disturbances. (RCP8.5)

Financial impact and response to climate-related opportunities and risks

Impact on business and initiatives to expand opportunities
Potential impact on finances
1.5℃ 4.0℃
Increased demand for services that contribute toimproving energy use efficiency and promoting the
spread of renewable energy through the use of IT(Field 1: Energy management and renewable energy)
Grid system reconstruction; introduction of EVs for use as
emergency power source; provision of services that combine energy data and data from different industries, etc.

Timeframe*

Response to growing
opportunities

Products and Services

Opportunities







Technology
Reputation

MarketTransition risk

Changing
customer
behavior

Deterioration in competitiveness
if it is not possible to appropriately reflect changes in the
demand and supply of lowcarbon products and services
in our products and services

Decline in corporate value dueto the absence of appropriate
provision of services that
Stakeholders’match the changing needs ofconcerns
low-carbon oriented customers
and investors and the lack ofproper information disclosure







ー

ー

ー

* Approximate time frame: short term, 1-3 years; medium term, 4-10 years

54

Impact on business operation
1.5℃ 4.0℃

Deterioration in technologicalcapabilities and service development capabilities due to falling behind in response to theprogress of low-carbon
technology

BIPROGY Group Integrated Report 2023

Group, whose core businesses are digital and ICT services,
are from the use of electricity. Therefore, we joined RE100
Increase in revenue opportunities in new markets and new
emerging markets throughdevelopment of new products
and services

energy for electricity we purchase and as of FY2022, thePercentage of purchased
energy used at the Group business locations that is renewable energy
Percentage of business opportunities and risks identified via
climate change scenario analysis (impact evaluation) for
which a risk response has been
implemented 100%
Percentage achieved for target
contribution to corporate netzero emissions*percentage of energy purchased that is renewable energyrose to 23.4%. We are also promoting energy conservation
measures based on the efficient use of offices and

ー



ー

We will create new products andservices through active development of technology that contributes to the transition to a
low-carbon economy.
Revenue will increase as we enter
new markets and new emerging
markets through this.



Short
term

~

Mediumterm

 ooperate with customers, partC
ners, and policy decision makers(business alliance, social
verification)
Invest in climate-related techcompanies

Expand low-carbon products
and services

Increase in revenue from thedevelopment and expansion of
low-carbon products andservices

Sales opportunities will grow due
to greater demand for digital
low-carbon products and services.

 romote the provision of outP
sourcing services
Expand carbon neutral–related
services

Decline in revenue due to lessdemand for products and services
The Group’s market dominancewould be undermined if we cannot ascertain customer behavior
regarding low-carbon products
and services and appropriately
develop technologies that contribute to related technologies.
This would reduce sales opportunities, and if it is not possible toabsorb the investment in development, profitability would fall.
Deterioration in access to capital
If low-carbon oriented investors
lower the Group’s sustainabilityrelated rating, and customer’s
evaluation of the Group as a supplier fall, revenue opportunities
would decline and financing costs
would increase.

(Scope 1 and Scope 2) GHG Emissions and Percentage of Purchased
Energy that is Renewable Energy
GHG排出量(Scope�+�)と再生可能エネルギー調達率の推移（t-CO�e）

��,���
��,���

��,���

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By FY2030• Reduce GHG emissions (Scope 1 and Scope 2)
50% or more (compared to FY2019)• Percentage of purchased energy that isrenewable energy 50% or more��,���

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�,���
�,���

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(FY)

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By 2050• Percentage ofpurchasedenergy that isrenewableenergy 100%
Target

50% or more compared to FY2019(FY2030)→ 25.1% reduction (FY2022)
Set the target of “having suppliers who
account for 40% of purchased goods
and services (category 1) set SBTcompliant targets by 2027.” (FY2022)
50% or more (FY2030)
100% (FY2050)→ 23.4% procurement (FY2022)

Identify business opportunities andrisks and continue to manage
identified risks through Group risk
management systems
100% or more (annually until FY2030)→ 174.6% (FY2022)* The net zero emission achievement rate is the sales of environmentally friendly
products and services multiplied by the GHG reduction contribution coefficientand divided by the total Scope 1 and 2 emissions of the BIPROGY Group.

（%）

FY2022 GHG Emissions: Scope 3 Breakdown����年度 GHG排出量Scope�内訳

Other
7.3%

���
��

FY2022
Scope 3Emissions

��
��
��
�

 GHG emissions (Scope 1 and Scope 2) (left axis)
Percentage of purchased energy that is renewable energy (right axis)

Category 11 Use ofsold products
55.5%

615,597

Category 1
Purchased goods
and services
37.2%(t-CO2e)

Reduce GHG emissions through initiatives throughout the supply chainPotential impact onfinances

reduction targets based on Paris Accord targets.

Goals and progress

GHG emissions (Scope 3)

and are moving forward with switching to renewable

science-based targets (SBT) certification for GHG emissions

Increased demand for services that contribute to
the promotion of companies’ net-zero management

Transition to
low-carbon
technology

material issues in 2021. Most of the GHG emissions by the

Because of these initiatives, we reduced the Group’s

Increase in revenue from thedevelopment of new products
and services through R&D andtechnological innovation

Increased demand for schemes utilizing digital technologies that do not rely on the movement of people(Field 6: Net-zero management)
Promotion of Green Transformation (GX); expanded use of
low-carbon data centers; development of solutions for introduction of carbon tax and carbon accounting; response totrend toward regionally diversified small data centers, etc.

Indicators

2022, we submitted a commitment letter to obtain(Field 5: New normal)
Greater sophistication of online communication through use
of AI; system development to resolve issues of access to consumer staples for vulnerable shoppers; expanded metaverse,
virtual office, and hybrid work; research on new analyticaltechniques effective for addressing climate change; etc.

Reduction rate in GHG emissions (Scope 1 + Scope 2(Market-based))

25.1% compared to FY2019. Furthermore, in September

Increased demand for schemes for green cities
using digital technologies(Field 4: Green mobility and transportation)
Use of digital technology for the spread of automated driving and EVs; optimization of energy consumption on a cityand region basis; provision of platform to centralize distribution and SCM information; response to the optimizationof electricity use on a city and region basis using EVs, etc.

set, such as those related to GHG emission reductions in

The Group is steadily working to achieve the targets it has

FY2022 Scope 1 + Scope 2 (market-based) GHG emissions

Increased demand for mechanisms that allow remotedecision-making without needing to go to the site

(Field 3: New reality and resilient cities)
Expanded use of remote-sensing technology in agriculture;
expanded introduction of BEMS accompanying increased
demand for low-carbon buildings; expanded use andimproved accuracy of disaster management systems, etc.

Indicators

equipment.



Increased demand for services that enable enhanced
efficiency and reduction of losses associated withproduction and consumption of goods using IT(Field 2: Circular economy)
Spread of supply-demand forecasting and traceability systems
based on AI; expanded use of shared systems by financial
institutions; promotion of shared use of facilities and means of
distribution; provision of services that make carbon content inpurchased goods visible; provision of systems that support
optimal production; provision of systems that match material
demand and supply forecasts for goods and materials, etc.

Indicators and Targets

Time
frame*

Risk-mitigation measures

Conduct R&D that contributes to thedevelopment of low-carbon technology

R&D investments
Human resource development

Provide services that meet changing
customer demands
Short
term

~

Medium
term





P
 rovide environmentally friendly services
that contribute to climate change mitigation and adaption
Promote customer engagement

Disclose reliable climate-related
informationI nitiatives to implement TCFD
recommendations
Promote constructive dialogue with investors

Conduct low-carbon business activities oin RE100 and promote switch to renewJ
able energy
Promote value chain engagement

To “achieve a net zero emission society,” which is stated in

Promote green procurement

important to reduce GHG emissions throughout the supply

continue to conduct risk assessments of suppliers andthe Long-Term Environmental Vision 2050, we consider it

chain. Because about 90% of the Group’s value chain GHG
emissions are Scope 3 emissions, we set “have suppliers
who account for 40% of purchased goods and services(category 1) set SBT-compliant targets by 2027” as a newtarget and material issue KPI in 2022. We will continue to

In order to reduce GHG emissions in procurement, we will
promote communication, which includes spreadingawareness of Green Procurement Guidelines and BIPROGY
Group Sustainability Procurement Guidelines, the Group’spurchasing guidelines.

strengthen initiatives to reduce GHG emissions inprocurement.


BIPROGY Carbon Neutral (Japanese only)

Purchasing and Procurement Guidelines, etc. (Japanese only)

https://www.biprogy.com/solution/theme/carbon_neutral.html

https://www.biprogy.com/com/about_purchase_and_procurement.html

BIPROGY Group Integrated Report 2023

55

Implementation Capability for Realizing Vision 2030

Human Resource Strategy
Material Issues

Develop and strengthen human resources to create a new future and promote diversity and inclusion

The BIPROGY Group considers human resources to be an important corporate asset and the driving force for

the Group’s sustainable growth and for improvement in its corporate value over the medium- to long-term. The
Group strives to create workplaces and environments where employees with diverse values and backgrounds
can maximize their individual abilities, and is steadily transforming itself into a company that creates social

value by reforming its human resources and corporate culture to enable it to continuously generate innovation.

The Human Resource Strategy Required to Achieve Vision 2030

areas. Under our Management Policies (2021-2023), which aim
to move us towards our Vision 2030, we are working to implement policies for human capital management and humanresource development based on the construction and operation of talent management systems and our human resourcearchitecture, which is built around our system of ROLES. These

strategies, we founded the Human Capital Management

Division in April 2023. The Division will be responsible for ourhuman resource portfolio management, planning and execut-

ing the Group’s human resource strategies, contributing further
to training our business leaders, reforming our working styles,

developing our organization and human resources, and implementing DE＆I* policies.
1

Our policy, as we work to fulfill our Purpose, is topolicies will enable us to strengthen our human resource man-actively seek opportunities for dialogue with stakeholders,

Our major policies include strengthening the links between

the company as we work strategically to develop humanagement and gain maximum value from a diverse workforce.

business strategy and human resource strategy/resource management, promoting self-directed career development andinvolving human resources from both inside and outside
resources capable of generating greater value.

*1 DE&I stands is a concept that covers of Diversity, Equity, and Inclusion.

ROLES-based Human Capital Management
Since FY2019, we have implemented a ROLES-policy tofacilitate the development of human resources capable ofachieving sustained innovation through intrapersonal

Schematic showing the connection between our businessstrategies and human resource strategies
Human Resource Portfolio

competencies and skills required to execute a particular

ROLES

job. It is a core concept that captures the type, quality, andvolume of human capital required to execute the various

ROLES system allows us to hire and train human resourcesin accordance with our management policies, generating a

Regeneration

culture that creates continual innovation. By organizing

our human resource portfolio (by division, organization,business areas, and age-group) through ROLES, we gain an
objective overview of the diversity within our overall organization, which allows us to achieve effective organizational resource management in areas such as

assignments, facilitating of job rotation, and the selectionof individuals for further training.

56

BIPROGY Group Integrated Report 2023

Human Resources

Visualizing our
Human Capital
Requirements

Placement

business strategies based on our overall management

Visualizing our human capital requirements through theters around a talent management system based on theemployees take charge of their own career-building andform, we will encourage “self-directed career develop-

to human resource strategy decisions, including personnel

centralized control of human resource data. With this platment”, “stronger organizational capabilities” and theself-development, we can also take a data-driven approach
placement, assignment, and training.

Promoting self-directed career development/reskilling

mid-career hires, we seek to hire a balanced range of person-

capital to meet social issues that change with the times. By

experience existing group employees do not possess to accel-

investing in employees’ skills, capacity development, and stronger organizational capabilities, we are working to further

strengthen the capabilities of a diverse range of human resources
who can achieve innovation, as well as the capabilities of those

who already have a high level of technical skill. Through regularcareer meetings between supervisors and their subordinates,

training in “career design” (divided into three age-group catego-ries), and career consultations with qualified staff (qualified career
consultants), we are working to help our employees design anddevelop their careers. In addition, through career development

programs based on our ROLES concept, we encourage employ-

ees to acquire skills and qualifications. We also encourage reskilling through self-administered online learning.

Hiring strong human resources

diversity. ROLES is our Group’s system for defining thestrategy.

By visualizing human resource data, we not only help

ments” as we seek to achieve our Vision 2030.

Our Group believes that we must invest continually in human

human resources who can become “business producers”. In

Human resource strategy is one of our Group’s key policy

career development and job assignment. The system cen-

addition, in order to promote our Groupwide human capital

BIPROGY Group needs human resources who can create
ners and sharing our vision and values.

“clarification and organization of human capital require-to promote our overall human resource strategy including

Hiring and Strengthening Human Resources

reskilling, and securing and developing human resources who

new social value together by involving customers and part-

Our Group is building human resource platforms designed

can lead key areas, such as human resources capable of DX andTo solve social issues with a combination of foresight,
insight, technology, and business ecosystems, theUtilizing Human Resource Data

Planning and Execution of
Human Resource Strategy
based on Business strategy

Recruitment

Foundations supporting each strategy/policy

Reform ofcorporate culture/
workstyles

DE&I

Foundations
supporting
diversity

Personnel
Systems

Assessment/
reward systems

Group, we continually seek to acquire a new talent and avoid

Human Capital
HR platforms

erate or take the lead in new business areas, as well as individuals capable of making an immediate contribution to existing
businesses, and experienced younger personnel with thepotential to grow rapidly after entering the company and contribute to our business in future. In FY2022, we hired 205 new
graduates, and 208 mid-career hires, the later representing asignificant increase on the 105 midcareer hires in FY2021.
Ratio of New Graduates and
Mid-Career Recruitment(People)
���
���
���
���

creating a large gap in the age-group composition of our work-���mately half of our new graduate hires, we also hire talented�(FY)

force. In addition to ensuring that women account for approxiindividuals irrespective of nationality. Through our year-round

Human Resource Development

���

���
��.�%

���
��.�%

����

���

Ratio of Men and Women
Employees among New Graduates
Recruitment (FY2022)
Women

���
��.�%

48.8%

Men

51.2%

���
��.�%

����

 New graduate recruitment
 Mid-career recruitment

Developing business producers

meetings in which employees are introduced to the skills andment knowledge who can produce a beneficial impact on soci-between 500 and 800 employees voluntarily take part in these

Our Group refers to individuals with specialist business developety as “business producers”. We set KPI in relation to fostering

Human Resource
Development

Organizational
Development

To support sustained growth and value creation within ournel including individuals who can harness knowledge and“business producers” to achieve one of our “Material issues”,

which is to double the number of employees with the highest
maturity rank under our ROLES system between FY2021 andFY2023. Over the 13 years between FY2010 and FY2022, we havedelivered our “Next Principle” training program, which aims toequip personnel with the practical skills required to generate

new businesses, to a total of 405 individuals. Since FY2017, wehave also been holding monthly pre-work Morning Challenge

services developed within startup companies. Each morning,meetings. Since FY2023, as a spinoff of the Morning Challenge,some employees have been making use of the lunch hour forinteractive dialogue sessions under the title “More Challenge”,

with around 100-150 employees taking part voluntarily in eachsession. By creating these human resource programs and com-munities, we are steadily making changes to employee attitudes
and behavior, changes that will lead to the creation of new businesses. We will continue to review these training programs, as
we work to strengthen our training of “business producers”.

BIPROGY Group Integrated Report 2023

57

Implementation Capability for Realizing Vision 2030

Human Resource Strategy

New products and services released in FY2022 iCE, a business development projectDOur “Environmental value management service”, a service
supporting greater efficiency in the management of
non-fossil fuel energy certificates“The Praise Card” app, a service supporting greater
employee engagement by harnessing praise and recognition to create a cycle of the success within an organization

Verification and testing on the resolution of social
issues conducted by BIPROGY during FY2022
 n AI sign language translation service that facilitates comA
munication between deaf*2 and hearing persons
“J’ s Marketplace” is a platform that supports the export ofJapanese sake, bringing together sake brewers and overseas importers*2 Deaf individuals who use sign language to communicate

Promoting DE&I (Diversity, Equity＆Inclusion)
Promoting gender diversity

As one of the Group’s material issues, we have established the KPIPromotion of dialogue on DE&I focusing on
dialogue between employees working in the fieldtions held by women to at least 18%. In addition, as an action planand voluntarily, to promote dialogue on DE&I, as we aim toof raising, by April 1, 2026, our percentage of management posi-

based on Japan’s Act on Promotion of Women’s Participation andAdvancement in the Workplace, we have, as a company, set targets
including “doubling the FY2020 number of women managers” and“achieving a women executive percentage of 20%” by FY2025. We
are working to systematically strengthen our human resource

development and human resource pipeline by holding programs
for women employees, at each layer of the organization, to promote self-directed career development and the formation of an
executive mindset. We are also holding management programs

that focus on the management of diverse human resources andbuilding frameworks for monitoring by, and reporting to, our sus-

tainability committee and Board of Directors in line with the management recruitment plans drawn up by each individual

Our divisions in the field work at their own initiative, actively

create a corporate culture that ensure, employees’ psychological safety and respect and harnesses a diverse range of values and opinions. The senior management of the field

departments that participate in these activities cooperatewith their subordinates to engage in a variety of dia-logue-based events designed to improve their own organization and the wider company. Since the start of FY2020, thenumber of participants in these events rose to reach a cumulative total of more than 500, as the number of events rose

beyond our originally planned total of 30 events. We are still

continuing with these activities, which are gaining wider traction in our field departments.

FY 2022, achieving this target ahead of schedule, as the number of

e-learning so that all employees can enjoy peace-of-mind over theirself-directed career development. Since FY2017, we have offered all

eligible employees, men or women, three-party (employee, supervisor, and diversity officer) consultations both before and after theiruse of childcare leave. For more than 10 years, nearly 100% of

women employees entitled to take childcare leave and return towork have done so, with an increasing number of women employees
balancing childcare responsibilities with management positions. In

addition, the number of positive responses to the survey on our system for supporting childcare leave among men employees rose by
26% in FY2022 compared to FY2016, and the percentage of men
employees taking childcare leave is continually increasing.

Maintaining and expanding employment of
persons with disabilities

Our Group is building support structures that provide consistent support to persons with disabilities, from recruitment
through to the initial period after joining the company. In

2018, BIPROGY Challenged Inc. was established to provide

employment for people with disabilities by allowing them towork completely from home, primarily handling web accessibility inspections using ICT, and it is working to expand its
fields of business. In addition, in 2020, BIPROGY also

launched an outdoor farm under the “Wakuwaku Farm” initiative to provide persons with disabilities with a way of maintaining physical and mental health while engaging inworthwhile farm work. A second farm opened in 2022.

Providing Workplaces that Offer Job Satisfaction
One source of company growth and competitive strength
is the development of organizations and workplaces that58

BIPROGY Group Integrated Report 2023

both by employees on site and employees at home.

age overtime hours, reform our workstyles and promote

the management of employee health, while also striving to
improve employee engagement.

Improving engagement

Since FY2013, we have conducted an engagement survey ofall employees. This important initiative helps us visualize our
employees’ attitudes and certain organizational issues. In
addition, we implement “engagement management”

through a year-round PDCA cycle principally involving managers. This cycle helps to improve engagement and each of

our organizations. “Engagement management” refers to thesequence of actions by which management put their vision

for the organization into words at the beginning of each fiscal
year, harness the results of an engagement survey in July toanalyze and understand the status of their organization,

develop, and execute an action plan to achieve the organizational vision, and then conduct a further post-execution survey at the end of the period. Various initiatives are also inplace to support management as they run the above cycle.

BIPROGY believes that one key success factor in generat-

ing further improvements in employee engagement is tostrengthen employees’ affinity with the direction of thecompany’s intended direction, including the company’s

provide diverse human resources — people who are able
to think autonomously and generate innovation —with

new communication styles, including meetings attended• T3 (Time to think) Project

One of the workstyle reforms at our Business Service

Division (Technical Division) is the T3 (Time to think) project.
Under this project, employees of the division take consecutive time each week to engage in activities other than theirprincipal work responsibilities, including the creation of

new business ideas or research. One aim of this project is topromote greater working efficiency as the time for these
additional activities is generated by reviewing the timespent on existing processes. These activities, which began in
2016, are now widely adopted and understood as a meansof developing new ideas and improving working efficiency.
• Promoting the efficient use of overtime

We encourage employees to make efficient use of overtime
and reach the goal of recording one or more months withzero overtime (defined as five hours of overtime or below).

This goal is intended to provide opportunities for reflecting
on and reviewing usage of time and working habits. Overthe three years between FY2018 and FY2020, we set a KPI

for a material issue (important sustainability issue) of hav-

ing 100% of employees achieve one or more months of no
overtime, and we have completely achieved that goal forthree consecutive years. Since FY2021, each organization

has taken the lead in continuing to ensure that employees
work effectively and efficiently to reduce overtime.

have enacted policies designed to promote awareness of Health management

sions, principally for executives and organization leaders.

Health Officer (CHO), working to maintain, improve, and

our Group principles, including workshops and debate ses-

women managers steadily continues to increase.

childcare or caregiving with their work, we also provide seminars andcient, judicious use of overtime in an effort to reduce aver-to achieve those goals. Therefore, from FY2023 onwards, wewomen executives (BIPROGY, non-consolidated) reached 20% in

In addition to putting in place systems to help employees balance

the introduction of hybrid conferencing systems that allow

their capabilities. Our Group works to promote the effi-

Purpose and Corporate Philosophy, and the actions takenorganization and Group company. As a result, the proportion of

Support for balancing life events and career development

worthwhile work that lets them make maximum use of Workstyle reforms

Under our workstyle reforms, as outlined under ourManagement Policies (2021-2023), we are reviewing various systems and implementing various policies with theaim of achieving “workstyle reforms that enable a diverse
range of employees to achieve their maximum perfor-

mance” and “workstyles that lead to the creation of newvalue”. In April 2022, we repositioned working from homeas one of our permanent working style options rather thanas a temporary measure. We also introduced annual leave

The CEO of BIPROGY also serves as the Group’s Chiefmanage employee health, and focusing on the threethemes of “preventing lifestyle disease,” “mental healthmeasures,” and “use of open innovation initiatives,” to promote employee health by reinforcing health promotionand early detection and treatment. In particular, from theperspective of “disease prevention” and “early detection

and treatment”, we work to contribute actively to employee
health promotion through initiatives such as treating those
who are at risk of high blood pressure and reducing thetotal number of workdays lost for mental health reasons.

Following changes in workstyles occurring during the pan-in hourly increments. In addition, we removed the limit on

demic, we are heavily focused on monitoring the mental

allowing for fully remote work. As we strive to improve thecompany, and in FY2023 we worked to reduce days lost to

the number of times employees can work from home,

flexibility of our workstyles, we are actively encouraging
the managers of each of our organizations to let theiremployees choose for themselves the workstyle that leads
to the greatest productivity, after considering the characteristics of their organization’s work, the need for teamwork, and other factors. Further, we are taking various

other steps to promote smooth communication, including

health of employees, especially those who have just joined themental health issues through various initiatives including theprovision of sessions with an in-house counselor for all

employees who are in their first three years at the company,

one on one sessions with their direct supervisor for all employees who are in their first three years at the company, and also
through the encouragement of improved mental health vigi-

lance by management, and improved self-care by employees.
BIPROGY Group Integrated Report 2023

59

Implementation Capability for Realizing Vision 2030

Corporate GovernanceMaterial Issues❶ Board of Directors

Further improve corporate governance and integrity

A mechanism of corporate governance that enables management to make prompt and sound management decisions under appropriate and effective supervision is indispensable to the BIPROGY Group’s continuous growth and increase in medium- to-long-term corporate value. The Company shall create,
maintain, and ceaselessly improve this mechanism.
Furthermore, in order to contribute to society as an enterprise resolving social issues, the Company
stipulates as part of its corporate philosophy “Listen sincerely to our stakeholders to improve our corporate value” in order to create relationships of trust with all stakeholders, and shall proceed with its business activities in accordance with this principle.

Corporate Governance Structure

The Board of Directors generally meets once a month. In
addition to deliberation and deciding on the Company’s
basic management policies, important matters, etc., itsupervises overall management, including execution ofduties by directors and corporate officers. The term of directors is one year so as to establish a flexible management
system that can respond to changes in the business environment and to clarify the management responsibilities of
directors. The Board of Directors met 12 times in FY2022.
Content of main deliberations in FY2022

 tate of progress in implementing Management Policies (2021–2023)
S
Matters related to personnel and evaluation of directors, etc.
State of operation of the internal control system, including theGroup’s risk management and complianceState of initiatives related to the Corporate Governance Code, including evaluation of Board of Directors effectivenessState of sustainability-related initiatives
State of dialogue with investors
State of handling of the loss of USB flash drives

BIPROGY has determined that an audit system involving supervision by a Board of Directors that includes outside directors andauditing by outside auditors is effective for monitoring management, and thus has adopted an Audit & Supervisory Board structure.
Corporate Governance Structure (As of June 29, 2023)❷ Audit & Supervisory Board

General Meeting of Shareholders
Appointment/Removal

Appointment/Removal
Audit❶ Board of Directors 8 Directors(including 2 women)
4 outside directors(50%)

4 internal directors

Appointment
and Supervisionof Representative
Directors

2 internal
members(4 independent outside
directors/2 women)

Report(3 independent outside
members/2 women)

Assistance
Audit

ReportIndependent Auditor(Accounting Auditor)

3 outside members(60%)

Inquiry❸ Nomination & Remuneration
Committee 3 members
1 internal
member❷ Audit & Supervisory Board 5 Auditors(including 2 women)

Appointment/Removal

MutualCoordination

Accounting Audit

Audit & Supervisory Board members audit the execution ofduties by directors and the internal control system throughtheir attendance of all important meetings including Board of
Directors meetings, the examination of the operational andfinancial status, and the exercise of their rights regarding
appointments and dismissal of accounting auditors and audit
compensation. In order to increase the effectiveness of Audit &Supervisory Board member audits and facilitate the executionof audit functions, the Office of Auditors (1 full-time employee)
aids the execution of Audit & Supervisory Board member
duties. The Audit & Supervisory Board met 16 times in FY2022.
Content of main deliberations in FY2022

Office of Auditors

 tate of initiatives to reinforce compliance framework
S
State of initiatives to reinforce internal control system
State of initiatives to reinforce risk management
State of initiatives to prevent misconduct, etc., or their recurrence

2 outside members(66.7%)(2 independent outside
members)❻ R&D/Investment

Inquiry❼ Project Review❽ Information System
Investment



Report⓯ Life Science Research
Ethics Committee❹ Group Internal Audit Division❺ Executive Council

❾ Sustainability❿ Environmental Contribution

⓫ Social Committee⓭ Risk Management Committee/
Business Continuity Project⓮ Information Security Committee⓫ Social⓬ Compliance⓭ Risk Management/
Business Continuity Project❽ Information System Investment
Committee❿ Environmental Contribution
Committee⓬ Compliance Committee❼ Project Review Committee❾ Sustainability Committee❻ R&D/Investment Committee⓮ Information Security⓯ Life Science Research Ethics

Business Execution Divisions (Business Divisions, etc.)

BIPROGY Group Integrated Report 2023

This advisory committee to the Board of Directors deliberates
and reports on matters pertaining to personnel and remuneration of our directors and corporate officers. The attendance ofindependent outside directors and the agreement of all members, including independent outside directors, are required
when passing resolutions. The committee met 7 times in FY2022.
Content of main deliberations in FY2022

 atters concerning composition of the Board of Directors and Audit &M
Supervisory Board and expertise and experience required of directors and Audit & Supervisory Board members (skill matrix)
Personnel proposals regarding director candidates and corporate
officer candidates (including representative director, order of acting
directors and corporate officers, performance evaluation, appropriateness of reappointment, and successor training plan, etc.)
Bonus payment amountIssue and allotment of restricted stock* The results of deliberations by the Nomination & Remuneration Committee
are reported and submitted to the Board of Directors.

❹ Group Internal Audit DivisionThis independent in-house body directly under the President
was established to audit the effectiveness and efficiency ofinternal controls through the Group. It confirms and audits
the state of activities of Group committees, divisions, andGroup companies. It also submits reports on internal audit
plans and audit results to the Board of Directors.

❺ Executive Council

The council, which is composed of corporate officers concurrently serving as directors and members appointed by
the President, is a decision-making body for material matters concerning business execution and ensures efficientdecision-making. Moreover, Audit & Supervisory Board
members are able to attend Executive Council meetings,
and full-time auditors normally attend.

Various Other Committees: Deliberate on individual management issues related to directors’ execution of duties from a practical point of view

Representative Director, President & CEO

60❸ Nomination & Remuneration Committee

Deliberates on the advisability of plans for businesses, products and services based on the Group’s priority areas, and decides
whether to invest in such plans. Also evaluates actual results versus forecasts for these plans and requests a review as necessary.

Determines the business risks, the validity of countermeasures, and the possibility of implementation for important development and service businesses. Also evaluates actual results versus forecasts for such projects and requests a review as necessary.

Deliberates on the advisability of cost, effectiveness, applied technologies and other matters for the Group’s own system development and operation and decides whether to invest in such systems. Also evaluates actual results versus forecasts for such plans and requests a review as necessary.
Formulates measures and policies on achieving SDGs, determines the appropriateness of overall business activities froman ESG perspective, comprehensively determines action promotion and evaluations, and requests a review as necessary.

Analyzes environmental contribution-related policies, manages and monitors the design of mechanisms topromote environmental contributions and their implementation.

Consideration of policies on social fields, design of mechanisms to promote a social response and the management andsupervision of the status of implementation, as well as other endeavors including corrective instructions on pending issues.

Oversees compliance programs such as Group compliance education and internal reporting.

Addresses various risks that exert a material impact on Group management and ensures business
continuity.

Formulates strategies for overall Group security and personal information protection, and considers andpromotes various measures based on those strategies.

Examines the validity of human-subjects research performed by the Company from an ethical and scientific perspective through an independent organization, and requests reviews if necessary.

BIPROGY Group Integrated Report 2023

61

Implementation Capability for Realizing Vision 2030

Corporate GovernanceInitiatives to Enhance Corporate Governance
The BIPROGY Group ceaselessly improves on initiatives for

expand business opportunities through trust with a variety ofmenting transparent, fair, prompt, and decisive decision

directors and Audit & Supervisory Board members, we alsoenhancing corporate governance as a mechanism for implemaking. To create business ecosystems, it is important tostakeholders. Therefore, in addition to ensuring diversity ofconsider succession plans for rapid evolution a priority issue.

Changes in the corporate governance system
Overall

Overall Corporate GovernanceDiversity Diversity in Directors and Audit & Supervisory Board Members

Effectiveness Evaluation of Effectiveness of the Board of Directors

2001

Overall

2004

Overall2012 Remuneration
2013

Overall
Overall
Overall2015

Succession
EffectivenessSuccession

Overall

Established Corporate Governance and Internal Control
Principles
Revised the regulations of the Board of Directors, etc.

Improvement of management transparency and objectivity

Clarification of basic approach to corporate governance andinternal control and its structure/management policy

Revision of agenda standards at Board of Directors meetings

To obtain the involvement and advice of an outside independent director on the appointment, removal and remuneration of directors and Audit & Supervisory Board members

Board of Directors
Internal
4

Formulated a senior management succession plan including
Sustainable growth
the CEO
Started evaluation of the effectiveness of the Board of
Directors
Introduced performance-linked bonuses

Launched the Management Leader Program
Expanded the scope of the senior management succession
plan

Evaluated effectiveness in FY2017 (third time) after appointing an outside specialized agency
Appointed an outside director as chairperson of theNomination ＆ Remuneration Committee

Improve the functioning of the Board of Directors

Increase in motivation to contribute to improving businessresults and corporate value
Selection and cultivation of candidates for senior management, including the CEO
Use of objective analysis by external experts for evaluation

Improve the effectiveness of the appointment, removal andremuneration system of directors and Audit & Supervisory
Board members

Formulated the selection criteria and procedures for outside
Improvement of management transparency and objectivity
directors
Increased the number of independent outside directors in
the Nomination ＆ Remuneration Committee to 2

Strengthen the independence and objectivity of theNomination ＆ Remuneration Committee

Revise director remuneration system (introduce restrictedstock-as-remuneration system)

Raise desire to contribute to greater medium- to long-term
performance and corporate value

Evaluated effectiveness in FY2019 (fifth time) after appointing an outside specialized agency
Increase the number of outside directors and disclose skill
matrixUse of objective analysis by external experts for evaluation

Select directors and Audit & Supervisory Board members who
possess a wide range of knowledge and experience to realize
Vision 2030 and implement Management Policies (2021–2023)

Changed the ratio of outside directors to 1:1 (4 outside direcImprove management transparency and objectivity
tors out of 8 directors)

BIPROGY Group Integrated Report 2023

Strengthen the independence and objectivity of theNomination ＆ Remuneration Committee

Business management experience at othercompanies

Directors Akiyoshi Hiraoka

Audit & Supervisory Board

Women
directors
2 (of 8)25.0%

Koji Katsuya

Women
2Internal
2

Technology/
R&D

Finance/
Accounting

Legal/Riskmanagement

ESG/
Sustainability*





































Nalin Advani







Yoshinori Ikeda
Asako Osaki

Audit &
Yuji Teranishi
Supervisory
Masaya Oishi
Board
members
Hirofumi Hashimoto

Harumi Kojo

Women
2

Women
members2 (of 5)40.0%

Industryknowledge

Takahito Kanazawa
Chie Sato

Outside Audit& Supervisory
Board members
3 (of 5)60.0%

Outside3
Men3

Independent outside officers

Noboru Saito





























Globalbusiness











Keiko Mizuguchi

















* S of ESG (environmental, social, governance) includes human resource strategy, diversity and inclusion, etc.

Reasons for selecting items in the skill matrix
Business management
experience at othercompanies
Industry knowledge
Technology/ R&D
Finance/ Accounting
Legal/ Risk management
ESG/ Sustainability
Global business

Independent outside directors become majority ofNomination ＆ Remuneration Committee members (2 outside members out of 3)

Outsidedirectors
4 (of 8)50.0%

Outside
4
Men
6

Skill Matrix

Clarification of the Company’s standards for independence
Clarification of independence criteria for outside auditors

includes one attorney, and two members who are women.

Composition of the Board of Directors and Audit & Supervisory Board

Overall

Revised the evaluation criteria for independence in the
Evaluation Criteria for Independence of Outside Officers

dent outside members, making up the majority, andtaxation, gender, and ESG/sustainability. Four of the eightOverall

Established Evaluation Criteria for Independence of Outside
Directors& Supervisory Board, three of the five members are indepen-

advanced specialized knowledge in the fields of international

Introduced performance-based remuneration system for
Increase in motivation to contribute to improving businessdirectors (excluding outside directors) and corporate officers results and corporate value
Changed the ratio of outside directors to at least one-third(3 outside directors out of 9)clarify the responsibility of directors. In addition, in the Audit

experience with venture investments and global business,62

Overall

is one year to establish a flexible management system and todirectors, and two of them are women. The term of directors

and knowledge in management both in Japan and overseas,



2022

Remuneration

sess diverse backgrounds, including abundant experience

The Board of Directors’ independent outside directors pos-Overalldirectors on the Board of Directors are independent outsideEffectiveness

Effectiveness2021

Changed the term of office of directors from two years to one Establishment of a flexible management structure and clariyear
fication of directors’ responsibilities

Increased the number of women serving as outside directors
Strengthening of diverse viewpoints
by 1 (outside directors became 4 from 3)

Overall

2020

Separation of management supervision and execution andmore efficient business execution

Diversity

Remuneration2019

Details/Objectives

Established Nomination ＆ Remuneration Committee

Overall2018

Introduced corporate officer system

Succession Succession Plan

Overall

Overall

2016

Main Initiatives

Remuneration Remuneration System

Diversity in Directors and Audit & Supervisory Board Members

Appropriate advice and supervision by outside directors who have management experience and achievements
at other companies are effective in order to enable the management to transform the Company into a company that creates social value by making appropriate and prompt business judgements pursuant to theManagement Policies (2021-2023) in the midst of the rapidly changing business environment.
A wealth of knowledge about the information service industry such as ICT and DX is essential for the Company
in order to promote DX for its customers and society as stipulated in the Management Policies (2021-2023) andexpand business ecosystems together with customers and partners.

As technology evolves rapidly, a wealth of knowledge and expertise about technologies and research including
advanced technology is essential for the Company in order to promote DX for its customers and society as stipulated
in the Management Policies (2021-2023) and expand business ecosystems together with customers and partners.
The Company needs directors well versed in finance and accounting in order to achieve transparent and correct financial reporting, strong financial foundation, strategic investments for sustained enhancement of corporate value and capital policy with consideration to appropriate shareholders returns.
Risk management that enables appropriate and prompt responses to deal with diversified and complicatedrisks as well as strengthening corporate governance are indispensable in order to enable a medium- to longterm increase in corporate value. The Company needs a wealth of knowledge about these issues.

The Company needs a wealth of experience and expertise about efforts on climate change, workforce strategies, and promotions for ESG/sustainability issues such as diversity and inclusion in order to create a sustainable society as it aims under the Management Policies (2021- 2023).
Borderless perspectives are indispensable in order to expand business ecosystems together with customers
and partners. Thus, the Company needs a wealth of knowledge about global business.

BIPROGY Group Integrated Report 2023

63

Implementation Capability for Realizing Vision 2030

Corporate GovernanceAppointment of directors

Committee, composed of a majority of independent outside

Succession Plan Staying Powerrate officers (hereinafter, senior management) are selected

lated by this committee. The Board of Directors then makes its

CEO, the plan defines seven important competencies,

to achieve results by setting lofty goals companies should

Candidates for directors who will concurrently serve as corpofrom individuals who are highly motivated and have a strong

sense of ethics as well as possess knowledge and experience todirectors, based on selection criteria and procedures formudecision based on that report.

enable them to precisely and effectively manage the Company.

Dismissal of directors

taking diversity into consideration and from individuals who

the CEO, violates laws and regulations or the articles of incor-

In addition, candidates for outside directors are selected while
possess abundant management experience and specialized

knowledge, and are able to provide advice on and supervisionof general management from an external, objective, and pro-fessional perspective. Senior management and outside direc-

tor candidates are selected by the Nomination & Remuneration

In the event that a member of senior management, including
poration, commits an act of fraud, act of tort, or act of betrayal,or it is judged that they have not sufficiently served their officeor fulfilled their function, the Company will remove suchmember from their position if it determines that the removal isjustifiable based on deliberations by the Board of Directors.

Initiatives to Improve the Effectiveness of the Board of Directors
To continuously improve corporate value, BIPROGY con-since FY2016, the Company has analyzed and evaluatedgovernance by fully deploying its functions. Every year

fiscal year and worked to improve its functionality.

siders it important for the Board of Directors to enhance
Board of Directors Effectiveness Evaluation Process

Target

Board of Directors
EffectivenessEvaluation Process

Evaluation Items(56 questions in
total)

the effectiveness of the Board of Directors in the previous

All FY2022 directors (8) and Audit & Supervisory Board members (5)Step 1 : Signed survey by all directors and Audit &Step 3 : Deliberation and evaluation by the Board of Directors
Supervisory Board members
Step 4 : F ormulation of action policies based on the evaluations
Step 2 : A nalysis and evaluation of content by outside consultants
Step 5 : I nitiatives① Role/functions of the Board of⑤C omposition and role of the Nomination⑨ Role of and expectations for Audit
Directors& Remuneration Committee& Supervisory Board members⑥ Operation of the Nomination &②P
 rogress of action policies for FY2022,⑩R elationship with various stakeholders
which were determined after evaluating
Remuneration Committee⑪O
 verall effectiveness of corporate govereffectiveness in the previous fiscal year
nance system and the Board of Directors⑦ Directors and Audit & Supervisory③ Size and composition of the Board
Board members training⑫ Self-assessmentof Directors⑧ Support system for outside⑬R esponse to the loss of USB flash drives④ Operation of the Board of Directors
directors

Results of FY2022 Evaluation and Policies for FY2023
IssuesIdentified in
FY2021

Actions to Be
Taken in
FY2022

FY2022
Evaluation

Actions to Be
Taken in
FY202364(1) Need to expand prior sharing of information in order to continue to deepen discussions on themes related tothe essence of management and appropriately follow up with an eye toward enhancing the effectiveness ofmonitoring by the Board of Directors(2) Need to conduct further discussions regarding the Group’s global strategies and human resource strategies(3) Need to not only share information with outside director members more promptly and enhance the content of
information in order to facilitate more active discussions at the Committee as the majority of Nomination &Remuneration Committee members are independent outside directors but also enhance the reporting of committee discussions to the Board of Directors to further enhance transparency of the Committee(1) Continue to enhance the effectiveness of monitoring by the Board of Directors by expanding the prior sharing of
information to deepen discussions on themes related to the essence of management, such as human resource
strategy and sustainability, and by following up appropriately.
(2) Discuss Group and global strategies and effectively monitor the progress of plans.
(3)With the majority of the members of the Nomination & Remuneration Committee being outside directors, inorder to facilitate more active discussions at the Committee, work to further enhance the transparency of theCommittee by sharing information with outside director members more promptly and enhancing the content of
this information, as well as by enhancing the reporting of committee discussions to the Board of Directors.

(1) Even though some progress was made, including expanding information sharing through training, holding meetings
to exchange opinions, etc., it is necessary to further deepen substantive deliberations on themes related to the essenceof management (management strategies, human resource strategies, global strategies, risk management, etc.)(2) Although progress has been made on some fronts, such as deliberations and reporting on strategies by the
Board of Directors, substantive deliberations regarding global strategies should be deepened after clarifying thegoal and necessity of global expansion.
(3) A lthough many commented that progress has been made, and the Group’s response was highly rated, further enhancement of the reporting of the Nomination & Remuneration Committee’s deliberation to the Board of Directors is preferable.
(1) In addition to further deepening substantive deliberations regarding not only management strategies but also humanresource strategies, global strategies, risk management, and similar matters, taking into consideration management strategies, the Board of Directors will continue to expand the material necessary for that in order to generate further growth.
(2) In light of the incident involving the loss of USB flash drives in June 2022, the Board of Directors will promptly share information
when a major incident occurs and monitor the state of initiatives to transform the organization’s culture and strengthen corporate officers and employees’ compliance and risk management awareness so that this type of incident never occurs again.

BIPROGY Group Integrated Report 2023

In addition to integrity, a critical quality demanded of the
including foresight and insight. We believe that the degree
to which each requirement is demonstrated will varydepending on the business environment (whether theCompany is in a period of transition/transformation, or
one of extension and expansion).

Requirements (Qualifications/Competencies)
1

Foresight

3

Determination

2
4
5
6
7

Insight

Innovation
PassionExecution

Diversity and Inclusion

To facilitate the acquisition and strengthening of the above
competencies, we plan and implement the Management

Leader Program and visualize and monitor candidate tal-

ent to strengthen the pipeline of management leader candidates responsible for the future of the Group. This is

Execution refers to the ability to steadfastly stay the course
strive for and displaying leadership. Diversity and Inclusionrefers to the ability to interact with a wide array of people
whether inside or outside the Company, recognizing thevalues of people with various standpoints without stereotyping and pigeonholing them. This also refers to theability to build proactive relationships based on anunderstanding of ideas from various corporate andcultural perspectives.

Management Leader Program

We have been carrying out the Management Leadership
Program since 2018 with the goal of building a humanresource pipeline for producing successors to senior management, seeking to generate management leaders committed to continuous transformation. As for theManagement Leader: Advanced program, one element of
the leadership program, a total of 30 participants haveparticipated in the program through FY2022 in order toacquire the necessary perspective, perception, and viewpoints for management leader candidates through dia-logue sessions with directors and experts from inside andoutside the Company.

Since FY2022, we have moved forward with centralizing

achieved through assessments and tough assignments, indata on human resource through the introduction of a tal-ment and experts.

reforming both in-house and outside training programs,

addition to sessions with internal and external manage- Ability to Create New Value

Foresight refers to the ability to foresee the future of the

BIPROGY Group, promote a vision with great aspirations

and make a commitment to the future. Insight refers to theability to understand global trends and changes, identify

ent management system, introducing new assessments,

and redesigning our assignment mechanisms, and aim tolink this to the Group’s sustainability management tostrengthen the human resource pool and pipeline for candidates and build a system for more systematic and continuous generation of management personnel.

developments in the Japanese economy, in other words

Nurturing future generations of management leaders

Determination refers to the ability to decide on a direction

ambition to lead the Company and to share and discusssocietal swings, and perceive essential value in everything.
with unwavering conviction despite unpredictable conditions and with an awareness of the risks involved.

 Ability to Improve

Innovation refers to the power to improve, leaving prece-

We hold CEO & Leaders Sessions as a place to nurturethemes and issues that should be taken on from a management perspective and to connect those to action. In

FY2022, 11 sessions were held, and more than 100 people
participated each one.

dent and custom behind to ambitiously carve out a newpath undeterred by difficulties. Passion refers to the ability
to gain the cooperation, trust, and encouragement fromthose around you while passionately engaging in allendeavors and communicating extensively. This also refers
to such attributes as a high sensitivity toward information
and receiving capabilities, as well as the ability to convey

objectives in the direction of realizing dreams, goals to beachieved, and solving problems.

BIPROGY Group Integrated Report 2023

65

Implementation Capability for Realizing Vision 2030

Corporate Governance
Remuneration System

Committee, an advisory committee of the Board of Directors,
and subsequently approved by the Board of Directors.

For remuneration for executive directors, the weight ofperformance-based bonus and stock remuneration wasincreased and, if performance targets are fully met, theRestricted stock remuneration tied to medium- to long-profit attributable to owners of parent), and stock remu-In FY2021, we introduced a remuneration system that incorpo-

term and long-term performance

fixed remuneration, performance-based bonus (linked torates both performance targets linked to medium- to long-neration are paid in a ratio of 4:4:2.

term performance and long-term performance conditions that

Non-executive directors are paid only a fixed monthly sal-include actual response to sustainability issues such as climate

ary that is not linked to performance to guarantee effective

change. The goal is to enhance corporate value in the medium-advising and monitoring of management. Policies for deter-

to long-term and strengthen the linkage between compensa-

mining director remuneration calculation methods are settion and medium- to long-term and long-term performance.

through deliberations by the Nomination & Remuneration

Directors (Excluding outside
directors)
Audit & Supervisory Board members (Excluding outside auditors)
Outside directors andoutside auditors

Total Remuneration
Paid (Millions of yen)

297
34

73

Remuneration Paid by Type (Millions of yen)(a) Fixed
Remuneration

147
34

73

Recipients(c) Stock
Remuneration(b) Bonuses

109

40

ー

5

ー

ー

2

ー

8

(Notes）1. One non-executive director is not eligible for bonus and stock remuneration.
2. Auditors and outside directors are not eligible for bonus and stock remuneration.
3. Amounts listed are rounded down to the nearest million yen.
4. The stock remuneration figures in the table above indicate the amounts recorded as costs for the fiscal year under review in the costs about restricted stock as remuneration granted to four executive directors.
5. The officer retirement benefit plan was cancelled as of June 30, 2006 as resolved at a meeting of Board of Directors convened on April 28, 2006.
6. The table above includes remunerations, etc. for two directors who retired at the conclusion of the 78th Ordinary General Meeting of Shareholders held on June 28, 2022.
7. In light of the loss of USB flash drives, Akiyoshi Hiraoka (Representative Director and President) voluntarily returned 20% of fixed remuneration (for three months), andthe above amounts reflect the voluntary return.

Illustration of executive director remuneration
Fixed

Composition ratio

Linked to Performance(a) Monthly
remuneration(i) tenure condition

4

4

1

(a) Fixed remuneration (a monthly remuneration)
The monthly remuneration for directors shall be no morethan ¥35 million, and for Audit & Supervisory Board members no more than ¥8 million.

(b) Bonus (linked to short-term performance)
The total annual amount of bonuses for executive directors
shall be no more than ¥400 million, and is determined by the
Board of Directors in accordance with a standard amount by
position and a standard coefficient based on profit attributable to owners of parent as determined by the Nomination &Remuneration Committee (for now, up to 0.5%).

(c) Restricted stock remuneration
The Company has adopted a restricted stock remuneration
plan for executive directors, which incorporates threerequirements and indicators: (i) tenure condition, (ii)medium- to long-term performance target (total shareholder

66(c) Restricted stock remuneration(b) Bonus (linked toshort-term
performance)

BIPROGY Group Integrated Report 2023

KPI conditions(ii) medium- tolong-term
performance target

1/3

directors and Audit & Supervisory Board members. FixedWith respect to the remuneration of directors and Audit &In FY2022, the Nomination & Compensation Committee(iii) ESG targets(linked to long-term
performance)

2/3

return (TSR) growth rate versus TOPIX), and (iii) ESG targets(see pages 24-25). These are paid at a ratio of 3:1:2, respectively.
The tenure conditions in (i) are designed to have executive
directors share awareness and value with shareholders
through share ownership. The performance indicator in (ii)is linked to medium- to long-term business performance, acomparative measure versus TOPIX of the degree to which
we have independently increased our corporate value independently of overall market influence. The ESG indicators in(iii) function as guideposts to the realization of important
issues that we are taking action on. The total annual amountof monetary claims for restricted stock remuneration shallbe no more than ¥200 million per year (the total annual
number of shares of common stock to be issued or disposedof in exchange for this compensation is limited to 66,000).

remuneration was paid in accordance with the resolution

passed at the May 2021 meeting of the Board of Directors.

Board of Directors

Nomination & Remuneration Committee

Supervisory Board members for FY2022, the Board ofheld four meetings related to the remuneration of direc-

Directors resolved at its June 2022 meeting to issue andallot restricted stock remuneration, and resolved at its May
2023 meeting to pay performance-linked bonuses to

Cross-Shareholdings

BIPROGY may strategically hold shares of partners if it is deemed

Total Remuneration in FY2022 for Directors and Audit & Supervisory Board Members with Subtotals for Each Type ofRemuneration and Numbers of Recipients
Classification Activities of the Board of Directors and theNomination & Remuneration Committee in
determining the remuneration amounts for directors
and Audit & Supervisory Board members for FY2022

that this would contribute to greater corporate value for theCompany, such as resulting in a stronger profit basis by maintaining or strengthening the relationship with partners. The determination to acquire stock is made pursuant to its internal

regulations. As for the subsequent holding of the shares, thetors and Audit & Supervisory Board members, discussing

the payment of performance-based bonuses and the issuance and allotment of restricted stock for FY2022.

Number of Stocks Held by BIPROGY for Non-pure Investment
Purposes and Total Value on Balance Sheet (listed companies)(Number of stocks)

Board of Directors verifies whether it is appropriate each year, and��amount of listed stocks on the balance sheet at the end of FY2022��the number of stocks held decreased by 2 stocks from the end of��

we are working to reduce such holdings. As a result, the total

declined ¥1.7 billion from the end of the previous fiscal year, andthe previous fiscal year to 22 stocks. Going forward, we aim to

reduce the total amount of strategic shareholdings on the balance sheet to less than 10% of total equity. The verification ofshares held as of March 31, 2023, was conducted at the Board of
Directors meeting held in June 2023. The results are as follows.

• The sustainability of the purpose for holding individual
shares and the consistency with the business strategy froma medium- to long-term perspective was verified. Basedon this result, the shares to be disposed of were confirmed
as the significance of their holding had diminished.

(Billions of yen)

��

��.�
��

�
(FY)

����

��.�
��

����

��.�

��

����

��.�

��

��.�

��
��

��

����

Number of Stocks (left axis) Balance Sheet Book Value (Partners) (right axis) Balance Sheet Book Value (Customers) (right axis)

��

����

�
�

• In addition to the above, the economic rationality for holding
shares other than those expected to be sold off was confirmed
by verifying such factors as profit from business with theissuer, etc., taking into consideration the cost of capital.

Policy Regarding Constructive Dialogue with Shareholders and Other Investors
In addition to disclosing information to its shareholders

mutual dialogue leads to the fair assessment of its value.

manner, the BIPROGY Group engages in proactive investor

shareholders and other investors and reports these opin-

and other investors at a suitable time and in an appropriate
relations and shareholder relations activities, led by its

CEO, CFO, and the executive in charge of corporate gover-nance promotion, in the belief that repeatedly engaging in

The Group places great significance on the opinions of its
ions to its management and the Board of Directors in atimely manner. These opinions are then used in making
improvements to the Company’s overall management.

Status of Response to Corporate Governance CodeAll areas are addressed. See the Company’s website listed
to the right for details on corporate governance and internal control.

 orporate Governance and Internal Control Principles
CCorporate Governance Report Necessary Systems to Ensure Appropriate Operations andStatus of Operation of the Systems


https://www.biprogy.com/invest-e/com/governance.html
BIPROGY Group Integrated Report 2023

67

Implementation Capability for Realizing Vision 2030

Directors, Audit & Supervisory Board Members, and Corporate Officers(As of June 29, 2023)
Directors

No. of attendance tothe Board of Directors
Meetings
12/12

No. of attendance tothe Board of Directors
Meetings
12/12

No. of company
shares held 35,400Akiyoshi Hiraoka

Representative Director, President, Chief Executive
Officer (CEO), Chief Health Officer (CHO)

Apr. 1980	Joined the Company
Apr. 2002	General Manager of Business Aggregation Department of theCompany
Jun. 2002	Corporate Officer of the Company
Jun. 2005	Director, Senior Corporate Officer of the Company
Apr. 2007	Director, Superior Senior Corporate Officer of the Company
Jun. 2007	Superior Senior Corporate Officer of the Company
Apr. 2011	Executive Corporate Officer of the Company
Jun. 2011	Representative Director, Executive Corporate Officer of theCompany
Apr. 2016	Representative Director, President & CEO of the Company (present)

No. of company
shares held
19,800Noboru Saito

Representative Director, Executive Corporate
Officer, Chief Marketing Officer (CMO)

Apr. 1986	Joined the Company
Apr. 2004	General Manager of Industry & Commerce 2 Department of the Company
Apr. 2009	General Manager of Industry & Commerce Department of the Company
Apr. 2010	General Manager of Industry & Commerce 2 Department of the Company
Apr. 2012	General Manager of Business Services Department of the Company
Apr. 2013	Corporate Officer of the Company
Apr. 2016	Senior Corporate Officer of the Company
Jun. 2016	Director, Senior Corporate Officer of the Company
Apr. 2020	Representative Director, Executive Corporate Officer of theCompany (present)
Jun. 2022	Outside Director, Seiko Group Corporation (present)

No. of attendance tothe Board of Directors
Meetings
12/12

none

none

No. of company
shares heldNo. of company
shares held
11,000

Yoshinori Ikeda

Nomination &Remuneration
Committee

Outside Director, Independent Director

Apr. 1985	Joined the National Tax Agency JAPANJul. 1992	District Director, the Seto Taxation Office, Hiroshima Regional
Taxation Bureau
Jul. 1995	Harvard Law School (Obtained Master of Laws in Jun.1996)
Jul. 2004	Visiting Researcher, Georgetown University Law Center (Retired in Jun. 2005)
Jul. 2008	Director, Office of Mutual Agreement Procedures of the National Tax
Agency Assistant Regional Commissioner (Planning and
Administration), Nagoya Regional Taxation Bureau
Director, International Operations Division of the National Tax Agency
Director, Large Enterprise Examination Division of the National Tax
Agency Regional Commissioner, Okinawa Regional Taxation Bureau
Oct. 2020	General Manager, International Tax Division, Hongo Tsuji Tax &Consulting
Nov. 2020	Admitted as Certified Public Tax Accountant
Apr. 2021	Lecturer at Graduate School of Global Business, Meiji University
Apr. 2022	Professor at Graduate School of Global Business, Meiji University (present)		Advisor, Hongo Tsuji Tax & Consulting (present)
Jun. 2022	Outside Director of the Company (present)

BIPROGY Group Integrated Report 2023

none

Asako Osaki

Outside Director, Independent Director (Newly appointed)
May 1997	Masters in International Affairs (MIA) (international humanrights law and human rights issues) from Columbia University
Jun. 1997	Joined the Bureau for Development Policy at the United
Nations Development Programme (UNDP) New York
Headquarters
Jan. 2005	Worked independently as an expert on international cooperation and gender issues (present)
Apr. 2009	Visiting Professor, School of Policy Studies, Kwansei Gakuin
University (present)
Jun. 2011	Director, Specified non-profit corporation Gender Action
Platform (present)
Apr. 2016	Evaluation Committee Member of the National Action Plan on Women,
Peace and Security (WPS), Ministry of Foreign Affairs (present)
Apr. 2021 Expert Member, Council for Gender Equality, Cabinet Office (present)
Jan. 2022	Member of the Domestic Committee of ISO/PC337 “Guidelines for thepromotion and implementation of gender equality” and an expert representing Japan in the Working Group on Gender Equality (present)
Jun. 2023	Outside Director of the Company (present)none

Masaya Oishi

No. of company
shares heldFull-Time Auditor, Outside Auditor, Independent
Officer

Apr. 1983	Joined The Norinchukin Bank
Jul. 2011	General Manager, System Planning Division, The Norinchukin
BankJun. 2013	Member of Audit & Supervisory Board, The Norinchukin Bank
Jun. 2015	Managing Executive Officer, Deputy Head of Asset Management
Unit, Mizuho Financial Group. Inc. (Retired in Mar. 2021)
		Managing Director and Managing Executive Officer, in charge of
JA Sales Dept. of Markets & Products Division and Corporate
Investment Services & Retail Business Division, Mizuho
Securities Co., Ltd. (Retired in Mar. 2021)
Jun. 2021	Outside Auditor of the Company (present)

No. of attendance tothe Board of Directors
Meetings 12/12
No. of company
shares held

none

Chairperson of theNomination &Remuneration Committee

Apr. 1984	Venture Capitalist, Investment / Corporate Strategy Advisor(present)
Sep. 1998	Director, Chief Marketing Officer, eSOL Co., Ltd.
Jan. 2007	President, Barco Co., Ltd. (Japan) (Retired in Jul. 2011)
Aug. 2009	Managing Director, Barco Electronic Systems Pvt Ltd. (India)(Retired in Aug. 2011)
Jan. 2010	Graduated from the UCLA Anderson and NUS (National
University of Singapore) Business School
Sep. 2011	Vice President, Asia Pacific, Barco Pte Ltd. (Retired in Dec. 2015)
Aug. 2013	Guest Lecturer, National University of Singapore Business
School (present)
Nov. 2015	Co-Founder, KPISOFT Inc (entomo pte ltd of the present)(present)
Feb. 2016	CEO Asia Pacific & Japan, Grey Orange Pte. Ltd. (Retired in Mar.
2019)
Jun. 2021	Outside Director of the Company (present)
Feb. 2023	Adjunct Professor, Graduate School of Leadership andInnovation, Shizenkan University (present)

No. of company
shares held

600

Jan. 1985	Joined the Company
Jul. 2007	Senior Project Manager of S-BITS Project, Software & Services
Department of the Company
Apr. 2011	General Manager, Financial 3 Department of the Company
Apr. 2012	Deputy Division Manager of Financial Business Division
Apr. 2014	Corporate Officer, General Manager of Corporate Planning
Department of the Company
Apr. 2016	Senior Corporate Officer of the Company
Jun. 2016	Director, Senior Corporate Officer of the Company
Apr. 2021	Director, Executive Corporate Officer of the Company (present)

Apr. 1992	Joined Japan Broadcasting Corporation (NHK)May 2001	Graduated from Columbia Business School
Aug. 2001	Joined the Boston Consulting Group
Jun. 2003	Joined the Walt Disney Company (Japan) Ltd.
Jan. 2012	Became independent as author and consultant
Apr. 2014	Member of the Committee of Certified Evaluation andAccreditation for Management and Professional Graduate
Schools Member, The Japan University Accreditation
Association, JUAA (public interest incorporated foundation)(present)
Apr. 2016	Tokyo Broadcasting System Television (TBS) Program PracticeCouncil Member (present)
Jun. 2017	Outside Director of the Company (present)

none

500

No. of company
shares heldApr. 1986	Joined the Company
Apr. 2008	Manager, J-SOX Promotion sec., J-SOX Project of the Company
Apr. 2011	Manager, J-SOX sec., Internal Audit of the Company
Apr. 2012	Manager, Group Internal Control sec., Corporate Planning
Department of the Company
Apr. 2015	Manager, Group Internal Control sec., Business Management
Department of the Company
Apr. 2016	General Manager, Accounting Department of the Company
Apr. 2018	General Manager, Business Accounting Department of theCompany
Jun. 2020	Auditor of the Company (present)

Dec. 1998	General Manager of Digital & Information Network Systems
Department, Tokyo Sales & Business Planning Division Digital &Information Network Systems Department, Business Form &Securities Printing Operations, Dai Nippon Printing Co., Ltd.
Apr. 2007	General Manager of System Development Division, Information
Processing Solutions Operations System Development Division,
Dai Nippon Printing Co., Ltd.
Oct. 2008	General Manager of Production Division, Information Processing
Solutions Operations Production Division, Dai Nippon Printing Co., Ltd.
Oct. 2012 General Manager of BPO Development Division, Information Solution
Operations BPO Development Division, Dai Nippon Printing Co., Ltd.
Oct. 2016	Deputy General Manager of BPO Center, Information Innovation
Operations BPO Center, Dai Nippon Printing Co., Ltd.
Apr. 2017	Representative Director, President, DNP Data Techno Co., Ltd.
Apr. 2018	General Manager of Information Systems Division, Dai Nippon
Printing Co., Ltd.
Jul. 2018	General Manager of ICT Business Development Division,
Advanced Business Center, Dai Nippon Printing Co., Ltd.
Jun. 2019	Corporate Officer, General Manager of ICT Business Development
Division, Advanced Business Center, Dai Nippon Printing Co., Ltd.
Jun. 2021	Director of the Company (present)
Oct. 2021	Corporate Officer, General Manager of Advanced Business Center, incharge of Information Systems Division, Dai Nippon Printing Co., Ltd.
Jun. 2022	Senior Corporate Officer, General Manager of Advanced
Business Center, in charge of Information Systems Division, Dai
Nippon Printing Co., Ltd.
Apr. 2023	Senior Corporate Officer, General Manager of Advanced BusinessCenter, in charge of Information Systems Division, Education
Business Division, ICT Management Office Technology, Research& Development Division, Dai Nippon Printing Co., Ltd. (present)

No. of company
shares heldNo. of attendance tothe Board of Directors
Meetings
12/12
No. of attendance to
the Audit & Supervisory
Board Meetings 16/16

Full-Time Auditor

Nalin Advani

No. of attendance tothe Board of Directors
Meetings
10/10

No. of attendance tothe Board of Directors
Meetings
12/12
No. of attendance to
the Audit & Supervisory
Board Meetings 16/16

Yuji Teranishi

Director, Executive Corporate Officer, Chief
Sustainability Officer (CSO)

Chie Sato

Outside Director, Independent Director

No. of attendance tothe Board of Directors
Meetings
12/12
No. of attendance to
the Audit & Supervisory
Board Meetings 16/16

Koji Katsuya

Takahito Kanazawa
Director

68

Nomination &Remuneration
Committee

No. of attendance tothe Board of Directors
Meetings
12/12
No. of company
shares heldNo. of attendance tothe Board of Directors
Meetings
12/12

Audit & Supervisory Board Members

Outside Director, Independent Director

Harumi Kojo

No. of attendance tothe Board of Directors
Meetings
12/12
No. of attendance to
the Audit & Supervisory
Board Meetings 16/16

No. of attendance tothe Board of Directors
Meetings
12/12
No. of attendance to
the Audit & Supervisory
Board Meetings 16/16

none

none

No. of company
shares held

Outside Auditor, Independent Officer

Apr. 1976	Admitted as an attorney-at-law in Japan (bengoshi)
Jun. 1983	LLM at the University of Virginia School of Law, Master of Laws
Apr. 2001	Served as judge in the Tokyo High Court Intellectual Property
Division
Oct. 2005	Joined Sakai Mimura Law Office (name at the time)Jan. 2015	Established Sakurazaka Law Offices (as Partner) (present)
Jun. 2017	Outside Auditor of the Company (present)
Jul. 2021	Auditor, Organization for Cross-regional Coordination ofTransmission Operators, JAPAN (present)

Keiko Mizuguchi

No. of company
shares held

Outside Auditor, Independent Officer

Apr. 1986	Joined JP Morgan Chase Bank, N.A., Tokyo Branch (name atpresent)
Apr. 1995	Associate Director, Standard & Poor’s International Ratings, Ltd.
Apr. 1998	Director, Chuo Aoyama Pricewaterhouse Cooper
Nov. 2000	Director, UBS Warburg Japan, Ltd.
May 2002	Senior Credit Analyst, Prudential Investment Management
Japan, Inc.
Apr. 2003	Senior Analyst, Chuo Aoyama Pricewaterhouse Cooper
Apr. 2005	Chief Analyst, Japan Credit Rating Agency, Ltd.
Apr. 2008	General Manager of Rating Planning Department, and Chief
Analyst, Japan Credit Rating Agency, Ltd.
Feb. 2013	Member of Business Accounting Council / Member of Audit
Standard Committee of Business Accounting Council
Apr. 2013	Commissioner of Certified Public Accountants and Auditing
Oversight Board
Jun. 2013	Member of Technical Committee: Insurance Contracts (From
June 2013), Member of Technical Committee: Financial
Instruments (From May 2015), and Member of TechnicalCommittee: Disclosure (From April 2017) of AccountingStandards Board of Japan (Retired in Mar. 2022)
Jul. 2015	Member of Working Group on Development of Infrastructure to
Vitalize the Corporate Bond Market, The Japan Securities
Dealers Association
Apr. 2017	Counselor and Chief Analyst, Japan Credit Rating Agency, Ltd.
Jan. 2020	Counselor in charge of Research and Planning, Japan Credit
Rating Agency, Ltd.
Jun. 2021	Outside Auditor of the Company (present)
Apr. 2022 ESG Economist, Asian Development Bank InstituteApr. 2023	Provisional Member, Committee on the System of Evaluating
Incorporated Administrative Agencies, Ministry of Internal
Affairs and Communications (present)
Apr. 2023	Member, Publicly Traded Company Etc. Auditor Registration
Review Board, The Japanese Institute of Certified Public
Accountants (present)

Hirofumi Hashimoto

No. of company
shares held

AuditorJan. 1992	Manager of Control Section, Planning & Control Department, Business
Form & Securities Printing Operations, Dai Nippon Printing Co., Ltd.
Jan. 1997	P.T. DNP Indonesia
Apr. 2002	General Manager of Planning & Control Department,
Commercial Planning Operations, Dai Nippon Printing Co., Ltd.
Apr. 2007	General Manager of Dynamic Advanced Communication Division,
Commercial Planning Operations, Dai Nippon Printing Co., Ltd.
Nov. 2009	General Manager of Strategic Business Planning Department,
Dai Nippon Printing Co., Ltd.
Jun. 2015	Corporate Officer, General Manager of Strategic Business
Planning Department, Dai Nippon Printing Co., Ltd.
Oct. 2017	Corporate Officer, General Manager of Strategic Business
Planning & Development Division, Dai Nippon Printing Co., Ltd.
Apr. 2018	Corporate Officer, in charge of Strategic Business Planning & Development
Division, Value Creation & Promotion Division, Dai Nippon Printing Co., Ltd.
Jun. 2018	Auditor of the Company (present)
Senior Corporate Officer, in charge of Strategic Business
Planning & Development Division, Value Creation & Promotion
Division, Dai Nippon Printing Co., Ltd.
May 2019	Senior Corporate Officer, in charge of Strategic Business
Planning & Development Division, Value Creation & Promotion
Division, Sanaicho Sales Division, Dai Nippon Printing Co., Ltd.
Jun. 2020	Managing Director, in charge of Strategic Business Planning &Development Division, Value Creation & Promotion Division,
Sanaicho Sales Division, Dai Nippon Printing Co., Ltd. (Present)
Apr. 2023	Managing Director in charge of IR and Public Relations Division,
Legal Affairs Department, Corporate Administration
Department, Internal Auditing Division, Facility Management
Promotion Department, Dai Nippon Printing Co., Ltd. (present)

Corporate Officers and Counselors
Kazuma Umehara

Atsushi Tsubouchi

Takashi Sasaki

Shinsuke Chiba

Senior Corporate
Officer, CFO
Senior Corporate
Officer, CDO

Corporate Officer,
CIO
Corporate Officer

Naoshi Nagashima

Hideaki Sato

Yuichiro Fukuda

Taeko Sawakami

Takeshi Yamada

Toshihiro Kobayashi

Senior Corporate
Officer

Corporate Officer
Corporate Officer

Corporate Officer
Corporate Officer,
CRMO
Corporate Officer

Yuji Takeuchi

Yoshiko Yamauchi

Naoya Okuyama

Nobuaki Nakatsugawa

Hideki Moriguchi

Hiroyuki Sato

Isao Miyata

Kumiko Shirai

Takashi Miyashita

Susumu Ogino

Corporate Officer
Corporate Officer
Corporate Officer
Corporate Officer

Corporate Officer, CISO

Corporate Officer, CCO
Corporate Officer
Corporate Officer
CounselorCounselor

Sadayuki Baba
Corporate Officer

Notes: 1. Attendance at meetings of the Board of Directors and Audit & Supervisory Board is shown for meetings held between April 1, 2022 and March 31, 2023.
2. No. of attendance to the Board of Directors Meetings of Mr. Yoshinori Ikeda is for meetings held on or after June 28, 2022.

BIPROGY Group Integrated Report 2023

69

Implementation Capability for Realizing Vision 2030

Further Improve Integrity
Material Issues

Further improve corporate governance and integrity
Sustainably procure and provide safe, secure products and services throughout the entire value chain

As a company that can provide social value and ICT services as trustworthy, sustainable social infrastructure, we
adhere to both domestic and overseas laws and regulations and recognize that acting in line with social norms

based on strong ethics and conducting sound, transparent business activities is vital not only in terms of risk management but also for building trust with a wide range of stakeholders, and for solving issues faced by society.

Promotion of Information Security

Our Group’s information security systems are comprised of theInformation Security Committee, which is chaired by the Chief
Information Security Officer (CISO), and the organizations under
the committee as well as the persons responsible for information
security within each organization. The Information Security Committee determines the Group’s cybersecurity strategy and protects personal information, considering and promoting policies
based on the above. Additionally, the Committee works acrossthe Group in collaboration with the Risk Management Committee to ensure that the causes of serious incidents are determined
and that recurrence prevention measures are put in place. The
Chief Risk Management Officer (CRMO) reports the various activities of the Information Security Committee to the Board of Directors. The persons responsible for information security in eachorganization hold centralized responsibility for each organization’s respective information security issues, ensuring thoroughawareness of the rules within the organization, introducing andmanaging policies, inspecting and reviewing policy implementa-

tion, and continually making improvements and other modifications to maintain and improve information security.
With respect to the loss of USB flash drives that occurred inJune 2022, we established a third-party committee made up of
external experts. We are implementing measures to prevent
reoccurrence based on the investigation results and recommendations. Going forward, we will continue endeavoring toprevent the fading of that case over time, the dilution of awareness, and the reduction of measures to prevent reoccurrence
to a mere formality. Recognizing that ensuring such cases
never happen again and continuing to be a company groupwhose presence is essential to the resolution of social issues
are key challenges faced by the Group, we aim to further elevate the level of information security through our initiatives.


Overview of Measures to Prevent Reoccurrence of Loss of USB Flash Drives
Measures to Prevent
Reoccurrence

https://www.biprogy.com/com/info_security/
info202206.html

Overview

Reinforced security management measures for projects that involve access to highly confidential customer information assets.
Put mechanisms and systems in place through which a newly established organization specializing in security objectively reviews and approves theappropriateness of said security management measures from the outside and comprehensively manages and monitors those measures.

Reinforced security management measures for portable media.

Have supervisors thoroughly verify the state of use of portable media in work on consignment and internal operations.

Reinforced the management of security management measures and the handling of personal data.

Enforce compliance with laws, government regulations, and Group regulations on contractor oversight through means such as education and guidance. Verify and monitor the operational status of organizational security management measures under (1) above and internal audits.

(4) F urther measures, Thoroughly prevent the fading of this case over time, the dilution of awareness, and the reduction of measures to prevent
including the fosreoccurrence to a mere formality.
tering of awareness Made decision to make the week in every June that contains the day on which the case occurred “Information Security Week” in order to instill the mindset and self-

awareness to never let such an event happen again in all Group executives and employees. Set this week as June 19 to 23 in FY2023, issued a message from the CISO
to Group executives and employees, and conducted the likes of various forms of information security and training related to the protection of personal information.

Cybersecurity Measures

70

As companies providing ICT services, our Group places utmost importance on cybersecurity risks, seeing the creation of new businesses
resulting from digital transformation and response to cybersecurity
risks as two sides of the same coin in accordance with the Cybersecurity
Strategy of the Japanese Government and the Declaration of Keidanren
Cyber Security Management 2.0. In recent times, companies in Japan
have been incurring considerable damage from ransomware*1. Moreover, many companies in Japan have recently been affected by ransomware, with attacks on medical institutions increasing particularly, andransomeware has grown more malicious. Companies are being called
upon to further reinforce their management of information in order toprotect smooth socioeconomic activities and the foundations of citizens’ lives. Accommodating the Amended Act of the Act on the Protection of Personal Information and addressing the issue of cross-bordertransfers of data are just some of the ways in which guaranteeing the
BIPROGY Group Integrated Report 2023

proper use of information in business is posing a challenge.
In order to continuously practice cybersecurity management inresponse to such challenges, the Group has determined a cybersecurity strategy and is promoting associated initiatives.
In FY2022, we provided assistance through our CSIRT*2 to customers who were afflicted by ransomware as well as newly configured
ten ransomware countermeasures in our endeavors to further reinforce our response to cybersecurity risk.
Going forward, we will keep on carefully looking for the presenceof any vulnerable areas from the dual aspects of people and organizations and establish omission-free measures.
*1 Illegal programs that encrypt data saved on devices to render it unusable anddemand consideration for the decryption of that data.

*2 Acronym for our Computer Security Incident Response Team. A technical support team that specializes in preventing cyberattacks before they occur andresponding to associated incidents.

Cybersecurity Foresight
Implement Digital Commons in society and provide a secure environment that befits us as a business ecosystem creator that connects
diverse companies.

VisionRealizing cybersecurity management that befits us as a company providing value that creates a more affluent society together with our customers and partners and solving social issues as we strive for the world-highest level of information security at all times.

MissionObjectives

Measures1. Provide secure platforms for customers and partners as a basis for business ecosystems
2. Maintain and improve the management quality of the Group so that it is chosen by customers and partners with peace of mind
3. Establish secure environments in which each employee can protect information assets and collaborate with various people on site
System measures

Customer systems andservices
Provide highly secure services and platforms

Internal systems
Continuously provide asafe environment

Organizational andprocess measures

Visualization measures
Disclose and share
information

Build systems that are
not vulnerable tocyberattacks

Human resource
measures

Improve the skills, abilities, and awareness ofGroup executives andemployees

Striving for the world-highest level of information security at all times

Ensuring cybersecurity requires us to ready ourselves against ever-evolving attacks from outside our organization and constantly
elevate our ability to identify, prevent, detect, respond to and recover from risks. As ICT companies that handle customers’ valuable personal information, we endeavor to foster Group executives and employees’ awareness of the need to consistently ensure
safety and reliability with respect to information security and keep on living up to customers’ trust. Moreover, we intend to strive
for the world-highest level of information security at all times in our entire supply chain by responding to cyberattacks and othersocial issues through the surefooted promotion of preventive measures developed in view of the loss of USB flash drives and ourcybersecurity strategy.
The Group has traditionally prohibited access to highly confidential customer information assets as a general rule. However, forthe management of such assets that have to be accessed in order to provide adequate services to customers, we recently established a management structure that conforms with the Three Lines Model by the Institute of Internal Auditors (IIA) as a form of“special operation management.” By managing risk across all three lines in an omission-free, organizational, and continuous fashion, the Group will strive to thoroughly enforce security management measures that are not allowed to become a mere formality.

IIA’s Three Lines Model and the Positioning of Special Operation Management
Governing body

Review of need for monitoring or
improvements by management

Accountability to stakeholders for organizational oversight
Regular reporting ofoperation status by CISOManagement

Third line

Actions (including managing risk) to achieve organizational objectives

First line

Special operation management

Auditing

Second line

(Business Departments)(Headquarters Departments)

Provision of products/
services to clients;
managing risk

Expertise, support,monitoring andexpression of objections
regarding on riskrelated mattersFirst line roles

All projects thatinvolve accessing
customers’ confidential information

Second line roles

Applications

Review/approval, etc.

Information Security
Operation Meeting

Review/approval/instructionof improvements/monitoring(Internal Audit Department)

Auditing

Regular auditing ofspecial operation
management as awhole (First andsecond lines areaudit subjects)

Third line roles

Independent andobjective assurance andadvice on all mattersrelated to theachievement ofobjectives

ISMS/PMS-integrated
internal audits, etc.

External assurance providers(1) O rganizational
security management measures(2) P hysical and technical security management measures(3) C ontractor
management

Loss of USB flash drives (Japanese only)

Overview of the BIPROGY Group’s Cybersecurity Strategy

ISMS certification, Privacy Markcertification, etc.

Regular reviews ofstatus of improvements, including
for special operation management

Audit implementation status for special operation management in projects (First line is audit subject)

Source: Prepared by BIPROGY using “The IIA’s Three Lines Model: An update of the Three Lines of Defense” by the IIA
and “Reference Materials for the 25th Meeting of Council” by the Financial Services Agency as a reference

BIPROGY Group Integrated Report 2023

71

Further Improve Integrity

Risk Management

Corporate Ethics and Compliance

Material Issues

Recognizing compliance to be a top-priority issue in its

hotlines. In addition, we presented concrete points to bear

Charter of Corporate Behavior, Group Compliance Basic“Compliance Week” in November 2022, we invited outside

execution of business, the Group determined its Group

Regulations, and Group Code of Conduct. Our policy underthese is for all executives and employees of the Group to

engage in ethical activities while complying with laws, regulations, social norms, and internal rules. We have also set
forth KPI and goals for material issues (See p. 24-25) andare endeavoring to enhance Group executives and employees’ knowledge of and awareness of compliance. To realize
that, the Group has established a Compliance Committee
and is working towards promoting compliance programs
under the supervision of the Chief Compliance Officer(CCO).

Compliance Education and Awareness Activities

instructors with experience in handling impropriety atother companies to conduct lectures on the theme ofblind spots that inhibit the practice of compliance.

Simultaneously, we carried out activities aimed at foster-ing awareness of compliance, including the issuing of mes-

threats, as well as changes in the international geopolitical environment and the emergence of new infec-

tious diseases. The BIPROGY Group considers risk management, which works to predict potential events andavoid or reduce loss, to be an important foundation for the resolution of social issues and value creation.

risk management, the BIPROGY Group has an officer

awareness of issues with a view to creating an organizational climate conducive to comfortably practicing
compliance.

Alongside these education and awareness activities, weGroup twice a year since FY2022 (as opposed to once a

education and training activities, and promote the adoption

including increasingly severe, large-scale natural disasters, the risk of impropriety, and information security

tive workplace to properly discuss their sentiments andGroup companies as forums for members of their respec-

for all Group executives and employees, we hold various

based training systems in order to continually implement

The business environment is becoming more diverse and complex every day, with risks to business activities

Reinforcing the Risk Management Systemhave been conducting monitoring (awareness surveys) on

training meetings and harness various intranet/e-learning-

Further improve corporate governance and integrity
Sustainably procure and provide safe, secure products and services throughout the entire value chain

FY2023 as well, we held “Compliance Roundtables” at all

sages from our CCO and organizational heads. Also, in

In addition to ensuring thorough awareness of the Group

Code of Conduct, which provides a concrete code of conduct

compliance aimed at all executives and employees of theyear originally) as part of our endeavors to ascertain compliance risks in greater detail.

With reference to the ISO 31000 international standard forCountermeasures Task Force is set up to address the risk

responsible for risk management, organizations asagement in each organization takes on the role andquickly and precisely. The person responsible for risk manresponsibility of managing that organization’s risk. Should

required, and works on the actions below.










a major risk materialize, we have systems that allow all ormulation of regulations for management of the riskFof loss

employees to work together to minimize damage andensure business continuation.

 evelopment and implementation of systems necesDsary for preventing risks

In the medium- to long-term risk management strategy,Dealing with emergencies

we have set (1) enhancing risk management throughout the eporting risk management activities to the Board ofR
Directors

quality and sophistication of our risk management systems

Group, (2) further improving the risk management abilities

Reviewing risk management items and systemsof Group executives and employees, and (3) improving theand thorough understanding of compliance.

Whistleblower System

the loss of USB flash drives, we performed a full revision ofCommittee office and a hotline to company auditors.

Committee, chaired by the Chief Risk Management Officer

munication for whistleblower reports. We also have an

measures. If a major risk materializes, the department

In FY2022, based largely on the lessons we learned withthe content of our e-learning in those areas and enhanced
information such as that on past cases of violations andtrends in reports and consultations made over our
Details of Compliance Program(Structures for promoting compliance)












 stablish and promote awareness of policies and regulations
EOrganizing and running systems for promoting complianceEstablishing and running reporting and consultation routes(whistleblower system)
Education and training activities
Implementing awareness surveys and other monitoring
activities
Other policies for the promotion of compliance

Main Measures Implemented in FY2022

BIPROGY Group Integrated Report 2023

Our Group has set up a hotline to the Compliance

These hotlines both serve as direct internal lines of comexternal whistleblower line that facilitates contact via athird party (Integrex Inc.). In addition, to ensure that any-one (a whistleblower) filing a report or engaging in consul-

tation is not disadvantaged, we have prepared and operatea whistleblowing structure that conforms to the requirements of the amended Whistleblower Protection Act(enacted in June 2022) , which helps us protect those whistleblowers. In FY2022, the above lines of communication

received 27 consultations (39 in FY2021), all of which werehandled appropriately. While the number of consultations

increased, not all of the consultations involved complianceviolations, and we take these calls as evidence that
employees feel comfortable accessing the hotline.

Group Compliance Basic Regulations (Japanese only)

BIPROGY Group Code of Conduct (Japanese only)

https://biprogy.disclosure.site/ja/themes/115

https://www.biprogy.com/com/corporate_code_
of_conduct.pdf

Information Security Initiatives (Japanese only)

https://biprogy.disclosure.site/ja/themes/114

as priority issues. To make firm progress in implementing
these policies, we run a PDCA cycle throughout the year

In addition, we established a Risk Management

identifying and monitoring risks, to propose improvements
based on any new issues that emerge and raise risk aware-(CRMO), as a body for implementing appropriate counter-

ness among all employees through education on risk.

originally impacted or the relevant committee promptly

reports it to the Risk Management Committee. Dependingon the severity, a Risk Countermeasures Council or a Risk
Risk Management Structure

Details on Our Risk Management Initiatives (Japanese only)

https://biprogy.disclosure.site/ja/themes/113

Customers

BIPROGY Group

Risk Management Supervisor (officer in charge/Group company president), Risk Management Representative (position
equivalent to division manager), Risk Management Executor (position equivalent to department manager )ReportingSupport and instruction
on countermeasuresupon risk manifestation

Risk control departments andrelated committees, etc.

Information Security Committee
Compliance Committee

Risk control departments

Reporting/
Escalation

Reporting/
Escalation

Support and instruction
on countermeasuresupon risk manifestation

BIPROGY Group
Risk Management Committee
Chairperson
Chief Risk Management Officer(CRMO)…

 onducted compliance awareness survey among all Group execuC
tives and employees
Response rates of 95.6% (conducted in July 2022) and 97.4% (conducted in December 2022)
Conducted e-learning for all Group executives and employees
Conducted various types of compliance training seminars
Established and held a compliance weekIssued messages from CCO and organizational heads
Held lectures by expert
Held Group company CCO Meetings
Held meetings with each organizational head for the sharing of compliance cases
Inspected proper use of software and other applications at eachorganization72

in mind upon practicing day-to-day compliance. During

Implementation Capability for Realizing Vision 2030

BCP formulationand training

Response uponoccurrence ofdisaster, etc.

Business Continuity Project(Headquarters disastercountermeasures task force)

Project leader
Chief Risk Management Officer(CRMO)
Established upon the manifestation of serious risk

President,
BIPROGY

Risk Countermeasures Council or
Risk Countermeasures Task Force

BIPROGY Group Integrated Report 2023

73

Implementation Capability for Realizing Vision 2030

Risk Management

Ascertain Risks

Our Group has a risk classification system as a platform forrisk control departments identify new risk management

risks faced by the Group. Currently, risk management

setting themes that consider the business environment

comprehensively identifying and jointly managing theitems are classified into about 130 categories such as information control risks, system development risks, and natural disaster and accident risks. The Risk Management

Enhance accuracyof inspection for risk
management items

List of risks

Strengthen risk management
capabilities (prevention, responseto accidents, and prevention
Responding
Priority riskof reoccurrence)
to incidents
management

the loss of USB flash drives in June 2022. As we provide

risk, identifying risks that require focused attention. By

due to a problem with a service or security incident

surveying all projects related to subcontracting that

Checks byrisk control
departments

Risk Map et topics each fiscal year
S
Provide reports in relation to frequency, degree of impact,
prevention measures, responses to the risk, existence ofaudits, measures to reduce frequency and impact, and thestate of risks that emerged in the previous fiscal year

ImpactMonitoring

An issue such as suspension of procurement or supply

uses a risk map to categorize the size of the impact of eachment policies and risk control items.

year to take stock of risk management items, and helps

 Risk B
Frequency

and “impact of physical distance, psychological distance,

included “increasing crisis management capabilities andresilience* as a business ecosystem creator” in the vision.
(1) Respond to COVID-19

ronment,” “changes in the environment due to COVID-19,”

risk response are properly being revised.

Furthermore, we identify risks that newly arise or change

and risks that could have a serious impact on business andmodel. These risks will be managed as “emerging risks.”

BCM so that the Group’s critical operations are resilient toFuture initiatives

cloud service problems, and large-scale disasters, in ordervarious fronts as COVID-19 is brought under control, weto transition to all-hazards BCP. One such initiative wasconducting an assessment of the Group’s BCP/BCM activities. As a result, we confirmed that improvements to BCP/
BCM and the introduction of the all-hazards approach
have both been launched.

* Tenacity in response to disasters and crisis that impede business continuity

As we did in FY2021, we listed risks in FY2022 and added“impact of Russia’s invasion of Ukraine” to “reviews
BIPROGY Group Integrated Report 2023

and implements initiatives to promote sustainable procurement. We take seriously problems with the Group’s
contractor management, which became evident with

ESG risk management

Furthermore, in April 2021, we formulated the BIPROGY
Group Sustainability Procurement Guidelines in

response to recent growing social demand for procure-ment that is conscious of human rights and the environment. We also launched ESG risk assessments andstatus of their ESG initiatives and conducted a risk

assessment. In FY2022, we requested improvements at
49 companies that were judged to need improvement.
Going forward, we believe that further efforts are

effectiveness to resolve issues, and will move forward

force us to change the business strategy and businessvarious business continuity risks, such as cyberattacks,and mitigates procurement risks in the supply chain

control divisions confirmed that preventive measures andworkstyles (telework).” At the same time, interviews with(3) Continually make improvements to BCP/BCM

the greatest risk, and worked to continually improve BCP/

utation or brand image. The BIPROGY Group ascertains

needed to increase both the expansion of companies

as the social environment shifts, such as geopolitical risks,

In FY2022, we focused on initiatives to respond to (1),the Group, such as negatively impacting our social rep-and casual introduction of digital technology due to new(2) Implement planned training to improve effectiveness ofbusiness continuity

customers. Moreover, it may affect the management oftracting companies and suppliers, and we surveyed theworks to continually improve BCP/BCM. In FY2022, we forhave continued the following activities since FY2021 as we

may seriously impact society as well as the Group’s

Our first assessment in FY2021 covered 98 major subconaccompanying changes in the internal and external envi-

mulated Resilience Reinforcement Strategy 2022 , andof a product or service, or a serious incident or failure

promoted the broader use of our guidelines by suppliers.

With the goal of “transitioning to all-hazards BCP,” which
the Japan Business Federation recommends, the Group74

 Risk C Risk A

Risk
response

Actions Taken in FY2022

Toward achieving sustainable procurement

every fiscal year. The Risk Management Committee thenidentifying and monitoring risks, we review risk manage-

Committee directs risk control departments every fiscal

Actionpolicy creation

items they would not be able to identify on their own by

While keeping an eye on risks due to greater activity on

will update both our response to changes in the external

and internal environment and risk management system. In
addition, we recognize that, for sustainability, we need toinclude the perspective of medium- to long-term forecasts,
not only concrete preventive and response activities when

events occur. We will work to improve procedures and process to identify and examine responses to emerging risks.

services to customers, we ascertained conditions by
the Group is undertaking, and then revised andimproved the contractor management system andoperations and once again thoroughly provided all

executives, employees, and subcontracting companies
with training and guidance. In order to ensure theeffectiveness of contractor management, we plan toaudit the state of operations.

by setting the following new KPIs and targets.
KPI

Percentage of suppliers targeted in the
ESG risk survey*

Percentage of suppliers that currently
adhere to or have launched improvements to material ESG risk items that
the Group has set for suppliers

100%
100%

FY of
achievement

2026

2030

* Distribute and collect responses to self-assessment questionnaire related tocompliance with sustainability procurement guidelines IPROGY Group Sustainability Procurement
B
Guidelines (Japanese only)

https://www.biprogy.com/com/pdf/
Sustainability_Procurement_Guideline.pdf

targeted in the survey and the improvements of our

Initiatives to respect human rights

TargetManuals and guidelines on human rights have been

which are being addressed” as a KPI for FY2023, andnomic groups, and Japanese companies have set ini-

Group in FY2021.

issued by Japanese governmental agencies and ecotiatives related to respect of human rights as an

essential management issue. The Group supports

international norms such as the Universal Declarationof Human Rights and the ILO Core Labour Standards,

and recognizes respect for human rights as an important element of its corporate activities. At the BIPROGY
Group, we conduct human rights due diligence toidentified the following human rights issues for the







 igorous dissemination of human rights policyRResponsible procurement and management thereofConducting stakeholder engagement
Establishing a mechanism for handling external complaints
Initiatives for freedom of expression
Initiatives for ethical/responsible marketing

In FY2022, we implemented a variety of measures,

reduce business risks related to human rights through-including making the BIPROGY Group Human Rights

BIPROGY Group Human Rights Policy based on theoverseas Group companies of the Group’s Humanout the value chain. In June 2020, we published the

Guiding Principles on Business and Human Rights. In

material issues, we set the target of 100% for “percentage of human rights-related issues at BIPROGY Group

Policy available in multiple languages and informing
Rights Policy, requesting improvements based on asurvey and evaluation of suppliers, and revising theclaim handling mechanism for suppliers.

BIPROGY Group Integrated Report 2023

75

Data Section

Business Results Summary(BIPROGY Inc. and its consolidated subsidiaries)

Summary of FY2022 Results
Revenue

Profit attributable toowners of parent

Operating profit¥339.9 billion ¥29.7 billion
Forecast 	¥330.0 billion

Forecast 	¥29.0 billion

Year-on-year change

Year-on-year change

Achieved¥20.2 billion

Forecast 	¥20.0 billion

Achieved+¥22.3 billion (+7.0%)

Achieved

Year-on-year change+¥2.2 billion (+8.2%)

other factors, profit attributable to owners of parent decreased.

173

201

+27

Decreasein R&D
expenses

16.2

 Outsourcing

17.0

Gross profit

Comprehensive income

23,78020,082

20,203

26,671

29,394

Revenue(3,698)

 Software+2,722(Billions of yen)
Revenue Hardware(Billions of yen)
Gross profit

(0.2)

Other
income

(0.2)

Other
expenses

Operatingprofit
29.7

Total

Share of profit
of investments
accounted forusing equity
method(0.1)(0.9%)

66.7

+5.2%

(1.5%)(1.7 pt)

2021

2022

Year-on-yearchange2.3

2.5+10.0%

2021

2022

Year-on-yearchange

5.3

5.1

10.3

34.1

Gross profit margin 15.4%

Revenue(1.4)

Increase inotherexpenses

Gross profit

+1.7%

25.5%

Gross profit margin 22.0%(287)Year-on-yearchangeYear-on-yearchange17.3

63.4+2.6 pt(0.8 pt)

Gross profit(319)

20,49016.1+12.2%

30.7%

2022

20,340

+745

52.4

2021

20,660

9,661

2022

(Billions of yen)

Profit

8,915

51.5

Gross profit margin 31.5%

 Others

Product sales

Increase inin-housesysteminvestment
expenses

Gross profit(Billions of yen)

(1.2)

+0.2

2021

+426

(3.5)

(1.1)

(Billions of yen)

30,001

SG&A expenses

Increase inpersonnel
expenses(1,794)+21.4%

34.2%

Gross profit margin 27.3%+154+2,24839.6

Gross profit margin 31.6%

29,575Adjusted operating profit

Analysis of Changes in Operating Profit (Billions of yen)

(70)

2022

Year-on-yearchange115.7

Revenue(249)

29,673529

32.6

FY2022 Results

103.1

Profit before tax

Profit attributable toowners of parent* Adjusted operating profit: sales revenue minus cost of sales and SG&A expenses.

567+6,212

27,425
2,324

Income tax expenses

decline in valuation gains pertaining to fund investments and

180

413

Finance costs

largely as a result of finance income decreasing due to a

666

251

Finance income

to ¥29.4 billion (up 10.2% year on year). On the other hand,

BIPROGY Group Integrated Report 2023

915

Operating profit

performance management indicator, increased by ¥2.7 billion

76+3,489Other expenses

that adjusted operating profit*, which the Group uses as a����59,955

Other income

increased, resulting in an increase in operating profit. Note

(FY)

56,46689,350Gross profit

Revenue

Services

improved profitability yielding profit growth, gross profit

Operatingprofit27.4+16,085

Share of profit of investments accounted forusing equity method

such as the increase in revenue from system services andServices

250,547

83,1382021

 Support Services(Millions of yen)

234,462

Selling, general andadministrative expenses

administrative expenses increased. However, due to factors

Product
sales-2.0 pt

FY2022(Billions of yen)
RevenueYear-on(April 1, 2021 –(April 1, 2022 –March 31, 2022) March 31, 2023) year change
317,600
339,898+22,297

Gross profit

renewal of core internal systems, selling, general and System Services

Year-on-year change+0.1 pt

Cost of sales

investments in an in-house system pertaining to the(0.6)

Fell short

Revenuetors led to an increase in revenue. For profit, due largely to+6.8

Forecast 	8.8%

FY2021

services continued to show growth. These and other fac-

+6.2

15.0%

Consolidated Statements of Profit or Loss For revenue, DX-related projects were brisk, and system

Gross profit

8.7%

Conditions by Segment

ROE

Year-on-year change-¥3.0 billion (-1.4%)

Financial Results

Operating margin

11.0

22.7%

37.4

+6.7%

+9.7%

(3.0%)(1.8 pt)

2021

2022

Year-on-yearchange

9.5

9.0

56.7

+2.7%

(4.6%)

Gross profit margin 17.2%

16.0%(1.2 pt)(Billions of yen)

2021

2022

Year-on-yearchangeGross profit

83.1

Revenue

317.6

339.9

Gross profit margin 26.2%

26.3%

89.4

Steady performance of DX projects,
revamping projects for core systems
and so forth for customers in a wide
range of business categories, including
financial institutions and service
industries, resulted in higher revenue
and profit. Profitability also increased
due to greater highly profitableprojects and improved productivity.

Aim to expand revenue and profit
through providing high-value-added
services while simultaneously
working towards acquiring new
assets required for future platform
creation.

Sales increased due to a buildup ofmaintenance and product installations,but profit decreased somewhat.

Continue working towards maintaining
and improving profitability.

Sales rose as a result of an expansionof platform services for regional
financial institutions and e-commerce
operators and other factors. However,segment profit declined for several
reasons, such as the impact of postingearnings from a highly profitable large
project in the previous fiscal year.

Aim to further expand the business byworking to provide services that
promote customer DX and expand thevarious service-based businesses that
contribute to the solution of social
problems.

————

Sales improved due to multiple
bookings of large projects for othercompanies’ products, but segment
profit decreased.

Promote sales of software that
contributes to customers’ DX, such as
customer touchpoint front-end
domain solutions.

Sales increased due to a buildup ofsmall to medium-sized projects,
including those for servers. However,segment profit decreased due largely
to the impact of the decrease in large
projects with high profitability.

Network-related products andhardware related to IoT and AI
continue to be in high demand against
the backdrop of stronger investment
in DX. The impact from semiconductor
shortages such as delayed delivery
dates has virtually normalized.

+0.7 pt

13.6%

55.2

Future Direction

+7.0%
+7.5%

+0.1 pt

����

BIPROGY Group Integrated Report 2023

77

ESG Data

Business Results Summary(BIPROGY Inc. and its consolidated subsidiaries)

Financial Condition

Cash flows

and contract assets as well as in intangible assets. Liabilities

in investing activities included ¥2.7 billion for the purchaseTotal assets increased from the end of the previous fiscal

year mainly due to an increase in trade and other receivables
increased from the end of the previous fiscal year due to anincrease in contract liabilities and other liabilities despite adecrease in lease liabilities. Total equity amounted to ¥141.6
billion, and the ratio of equity attributable to owners of parent to total assets rose 1.9 percentage points to 49.9%.

Consolidated Statements of Financial Position (Millions of yen)
AssetsCurrent Assets
Non-current assets
Total Assets
Liabilities
Current Liabilities
Non-current liabilities
Total Liabilities
EquityTotal equity attributableto owners of parent
Non-controlling interests
Total Equity
Total Liabilities and equity

FY2021

FY2022

Versus End
of Last FY

158,056
110,590
268,647

164,650
115,745
280,396+6,593+5,155+11,749(As of March 31, (As of March 31,
2022)
2023)

98,14839,823
137,972

98,94039,858
138,798

128,917+10,970

1,710
141,597
280,396(46)+10,923+11,749

The BIPROGY Group’s Market Environment

In the domestic IT services market, the willingness of companies and other entities to invest in IT is anticipated to
expand, particularly in the DX domain. At the same time,amid the rapid progression seen in digitalization, customer
needs for ICT services have become increasingly sophisticated and diverse. Moreover, competition has become progressively fierce due to market entry by players in otherbusiness categories. In these highly uncertain conditions
where projections are difficult and there is a lack of a clear
picture of what lies beyond, we in the Group will aim tocreate social value by applying our foresight and insight
towards becoming our customers’ partner in their efforts topromote DX.

Changes in Amounts of Investment in Software(FY)

ManufacturingNon-manufacturing

All industries

Financial institutions

2019

2020

2021

2022

3.6

8.4

-6.4

6.4

9.1

4.3

-9.8

14.7

10.3

-6.2

-10.2

-4.9

-5.5

-0.4

10.2

All industries including
Financial institutions andHolding companies, etc.

-

9.7

-

-5.9

10.0

All industries including
Financial institutions

Holding companies, etc.

-7.4

-7.3

9.7

7.6

1.0

5.4

8.8

5.6

Source: “TANKAN (National Short-Term Economic Survey of Enterprises inJapan),” Bank of Japan

78

(%)

2018
6.1

BIPROGY Group Integrated Report 2023

Free cash flows decreased year on year due to an increasein cash flows from investing activities. Major expendituresof property, plant and equipment such as computers forsales, ¥11.9 billion for the purchase of intangible assets,

mainly investments in software for outsourcing, and ¥2.8

billion for the purchase of investment securities, mainly forfund investments and a CVC fund management subsidiaryof the Company.

Consolidated Statements of Cash Flows
FY2021Net Cash Provided by (Usedin) Operating Activities
Net Cash Provided by (Usedin) Investing Activities
Free Cash FlowsNet Cash Provided by (Usedin) Financing Activities
Effect of exchange ratechanges on cash and cash
equivalents
Net increase (decrease) incash and cash equivalents
Cash and Cash Equivalents
at End of Period

+791
+34
+825

139,887

1,757
130,674
268,647

Data Section

16.2

11.5

21.0

14.5

11.9

14.3

(April 1, 2021 –March 31, 2022)

29,435

FY2022(Millions of yen)

(April 1, 2022 –March 31, 2023)

28,419Year-on-yearchange(1,015)(10,957)(15,537)(16,118)(18,043)

62

103

+40

2,421

(5,058)(7,480)18,477

12,882

48,70343,645(4,579)(5,595)(1,925)(5,058)

Trends in Domestic Private IT Market Size and Projections
(Billions of yen)
(FY)

Domestic IT
marketVersus last
fiscal year
(Billions of yen)

2018

2019

2020

2021

2022

2023

2024

(Projected) (Projected) (Projected)

12,493 12,890 12,970 13,550 14,090 14,400 14,600

102.8% 103.2% 100.6% 104.5% 104.0% 102.2% 101.4%
Projected

��,���
��,���
�

����
����
����
����
����
����
(FY) ����
Source: “ IT Investment by Domestic Enterprises in Japan: Key Research findings
2022” (announced on December 7, 2022), Yano Research Institute Ltd.
*1 Figures for FY2018-FY2021 are estimated by Yano Research Institute based on
surveys by the Ministry of Economy, Trade and Industry and the Ministry ofInternal Affairs and Communications.
*2 Based on fiscal year and amount of IT investment.
*3 Figures for FY2022 and beyond are projected values.
ICT market size (expenditure)(Year 2022)

ICT investment(Year 2021 (Year 2015 values))

Size of the cloud service
market(Year 2022, sales prospect)

Telework use situation(ratio of the enterprises introducing telework in 2022)

State of Introduction of IoT/AI(Introduction rate, Year 2022)¥27.2 trillion

YoY: 5.2% increase(17.8% all corporate ofcapital investment)

YoY: 0.4% decrease¥15.5 trillion¥2.2 trillion

YoY: 29.8% increase

51.7%

Previous year:
51.9%

13.5%

Previous year:
14.9%

Source: P repared by BIPROGY based on “Outline of the 2023 White Paper on
Information and Communications in Japan,” Ministry of Internal Affairs
and Communications

KPIs in bold relate to Material Issues (p. 24-25)

Material Issues

Contribute to the environment through the use of digital technology and reduce the environmental impact
of business activities in order to help build a world of net zero emissions
Sustainably procure and provide safe, secure products and services throughout the entire value chain
Main Initiatives for
FY2022

Setting of targets for Scope 3 (Category 1) reductions

I mpact assessments for business opportunities and risks through our climate change scenario analysis
project
Submission of Commitment Letter in 2022 with the aim of acquiring SBT certification

Energy consumption (kL)

1

(FY)

Purchased electricity (kWh)Purchased electricity from renewable energy sources(included in the above purchased electricity) (kWh)Percentage of purchased electricity derived fromrenewable energy sources (%)
Scope1 and 2 GHG emissions1, 2

Scope 1 GHG emissions (t-CO2e)

Scope 2 GHG emissions (Location-based) (t-CO2e)

Scope 2 GHG emissions (Market-based) (t-CO2e)

Scope 1 + Scope 2 (Market-based) total emissions(t-CO2e)1
Scope 3 GHG emissions (t-CO2e)3Category 1
Category 2

Purchased goods and services
Capital goods

Category 3	Fuel and energy related activities notincluded in Scope 1 or Scope 2
Category 4	Upstream transportation anddistribution
Category 5

Waste generated in operations

Category 7

Employee commuting

Category 12

End-of-life treatment of sold products

Category 6

�,���

ICT Market Trends

Environment

Business travel

Category 11

Use of products soldPaper used (million sheets)4Paper used (kg)4

Waste emissions (t)4Water used (million m3)5

2018

2019

2020

—

—

7,613

—

7,855

—

2021

2022

—

27,229,042

25,835,293

7,425

—

7,836

2,025,840

7,608

6,041,212

—

—

0

7.4

23.4

0

0

218

1,470

1,406

14,35813,475—

14,107——

13,442

12,37013,064

10,753

11,593

9,347

14,107

14,358

13,692———

251,490229,242

—

—

—

2,276

2,330

—

—
—
—
—

—
—

—

—

—

—

—

33,493

—

1,785

3,141

—

—

2,570

4,367

—

352,767

341,618

—

—

—
—
—

—

—
—
—

15.11

7.25

455

426

213

—

20,684

615,597

—

17.46
—

632,737

—
—

31

1,028
105

31

1,211
165

—

25,696

23,698

0.013

0.049

0.053

649

339

Scope of calculation
Figures shown have been rounded off to the nearest whole number.
1 For FY2018 to FY2019, BIPROGY Inc. and 10 other companies and two other organizations (major offices in Japan); for FY2020, BIPROGY Inc. and 12 other companies and 2 otherorganizations (major offices in Japan); for FY2021, BIPROGY Inc. and 24 other consolidated companies excluding limited partnerships for investment projects (major offices inJapan and abroad); for FY2022, BIPROGY Inc. and 25 other consolidated companies excluding limited partnerships for investment projects (major offices in Japan and abroad).
2 From FY2021, calculated in accordance with the GHG Protocol; Scope 2 location-based and market-based are from the definitions in the GHG Protocol Scope 2 Guidance 2015.
3 Scope 3 emissions have been calculated since FY2021; of the 15 categories in Scope 3, Category 8 is included in Scope 1 and 2, Category 9 in Category 1, and Category 13 in
Category 11. Note that categories 10, 14 and 15 have no business activities covered.
Scope of aggregation: for FY2021, 24 consolidated companies (major offices in Japan and abroad) excluding BIPROGY Inc. and other investment limited partnerships; for
FY2022, 25 consolidated companies (major offices in Japan and abroad) excluding BIPROGY Inc. and other investment limited partnerships.
4 For FY2018 to FY2020, BIPROGY Inc. and 12 other companies and 2 other organizations (major offices in Japan); for FY2021, 24 consolidated companies (major offices in Japanand abroad) excluding BIPROGY Inc. and other investment limited partnerships; for FY2022, 25 consolidated companies (major offices in Japan and abroad) excluding BIPROGY
Inc. and other investment limited partnerships.
5 For FY2020, Toyosu head office of BIPROGY Inc.; for FY2021, 24 consolidated companies (major offices in Japan and abroad) excluding BIPROGY Inc. and other investment limited partnerships; for FY2022, 25 consolidated companies (major offices in Japan and abroad) excluding BIPROGY Inc. and other investment limited partnerships.

BIPROGY Group Integrated Report 2023

79

Data Section

ESG Data

SocialGovernance

KPIs in bold relate to Material Issues (p. 24-25)

Material Issues

Material Issues

Develop and strengthen human resources to create a new future and promote diversity and inclusion
Sustainably procure and provide safe, secure products and services throughout the entire value chain
Main Initiatives for
FY2022Further improve corporate governance and integrity

 etermined a roadmap with a view to enhancing the disclosure of information on human capitalDBegan issuing requests for improvements to main suppliers and other actions based on risk assessment results for FY2021
Reinforced inter-Group collaboration and updated promotion plans in order to promote women’s
empowerment(FY)

Employment, diversity, and working hours
Consolidated number of employees
Japan
Asia
Americas
EuropeAverage years of continuous employment (years)6
Man
Woman
Paid leave utilization rate (%)7
Percentage of employees with disabilities (%)8Percentage of management positions held by women(%)9
Percentage of woman employees (%)
Number of people employed (new college graduates)10
Men
Women
Gender pay gap (%)11
Employee turnover rate (%)7
Average monthly overtime hours worked per employee(hours/month)7
Weighted average score of work style related items in
the engagement survey12

Work-life balance
Percentage of employees returning to work after childcare leave (%)7
Percentage of eligible people taking childcare leave(Men) (%)13
Number of employees taking paid leave for nursing care7
Development of Human Capital
Capital investment in people (billion yen)7

Value chain
Rate of initiation of actions, such as requests foraction made to main suppliers (%)7
Percentage of main suppliers for which an ESG risk
assessment has been made (%)7
Suppliers’ understanding of the BIPROGY Group
Procurement and Transaction Guidelines (%)7
Other
Online uptime rate (%)7
Number of occupational accidents14

2018

7,740
7,525
215
0
0
21.0
21.4
18.6
87.30
2.33
5.0

2019

7,830
7,523
304
3
0
21.0
21.7
18.4
86.20
2.31
5.5

2020

7,913
7,615
293
5
0
21.0
21.7
18.1
81.10
2.59
7.5

2021

8,068
7,720
336
12
0
21.0
21.8
17.8
82.54
2.62
8.1

2022

8,124
7,759
353
12
0
20.9
22.0
17.1
85.15
2.84
9.3

17.6
177
98
79
—
2.57

18.5
204
130
74
—
2.81

19.5
243
139
104
—
2.34

20.6
248
127
121
—
2.25

21.5
205
105
100
76.3
3.06

—

3.35

3.37

3.43

3.47

15.9

15.5

14.9

16.3

17.3

BIPROGY Group Integrated Report 2023

Main Initiatives for
FY2022 eviewed and implemented measures to prevent reoccurrence based on the loss of USB flash drives
R
that occurred in June 2022
By enhancing the provision of information through training and opinion exchange meetings, strengthened the effectiveness of monitoring of the Board of Directors
Conducted compliance awareness surveys twice a year starting in FY2022 (once a year until FY2021)(FY)

Board of Directors ratio of independent outside directors (%)
Audit & Supervisory Board ratio of independent outside auditors (%)
Dividend payout ratio (%)15
ROE (%)15
Number of serious security incidents16

2018

33.3
60.0
38.8
13.1
0

2019

37.5
60.0
38.6
15.5
0

2020

44.4
60.0
41.1
13.4
0

2021

50.0
60.0
41.7
17.0
0

2022

Scope of calculation
15 International Financial Reporting Standards (IFRS) have been applied since FY2021; figures for FY2020 and earlier are based on Japanese GAAP.
16 Before FY2020: BIPROGY Inc. and BIPROGY’s 100%-owned consolidated subsidiaries in Japan; from FY2021: BIPROGY Inc. and its consolidated subsidiaries.

Participation in Major International Initiatives,
Acquisition of Third-Party Certifications• UN Global Compact• Women’s Empowerment Principles (WEPs)• Task Force on Climate-related
Financial Disclosures (TCFD)• RE100• ISO 14001• ISO/IEC 27001:2013, JIS Q 27001:2014• ISO 9001
• Privacy Mark certification• DX Certification

50.0
60.0
39.8
15.0
1

Major External Evaluations• S&P Global Sustainability Yearbook Member 2023
• Noteworthy DX Company 2022
• FY2020 New Diversity Management Selection 100 Prime•F Y2019 Advanced Corporation Awards for the Promotion of Active
Participation of Women, Minister of State for Gender Equality Award• FY2021 Nadeshiko Brand• Platinum Kurumin certification• Eruboshi certification• Ikumen Company Award 2018 Grand Prize, Work-Life Balance
Support Category• PRIDE Index 2022: Gold Rating• 2023 Certified Health & Productivity
Management Outstanding Organization
Recognition Program White 500
Sustainability
Yearbook Member
S&P Global ESG Score 2022
• Top Hundred Telework Pioneer Award
from the Minister for Internal Affairs and/100
Communications etc.
BIPROGY Inc.
IT services

99
—

477
3.5

97

99

99

—

24.8

30.1

48.7

3.4

3.1

2.6

2.6

488

296

—

—

—

93.8

99.8

100

99.992
3

99.997
6

99.996
5

—

98

—

—

501

—

100

—

—

100

99.9991264

As of February 7, 2023.
Position and Score are industry specific and reflect exclusion
screening criteria. Learn more at spglobal.com/esg/yearbook

515

Inclusion in ESG Indexes
Morningstar Japan
ex-REIT Gender Diversity
Tilt Index—

99.998
6

Scope of calculation 6 BIPROGY Inc. on a non-consolidated basis
7 BIPROGY Inc. and Uniadex Ltd
8 Before FY2019: BIPROGY Inc. and Uniadex Ltd.; from FY2020: BIPROGY Inc. and 6 other companies
9 Before FY2020: BIPROGY Inc and Uniadex Ltd.; from FY2021: BIPROGY Inc. and 6 other companies
10 Before FY2020: BIPROGY Inc., consolidated subsidiaries in Japan and Cambridge Technology Partners Inc.; from FY2021: BIPROGY Inc. and 8 other companies
11 BIPROGY Inc. and 6 other companies
12 The standard score of KPIs for material issues is the average of the scores for FY2019 and FY2020 (3.36).
13 Before FY2021: BIPROGY Inc. and UNIADEX, Ltd.; FY2022: BIPROGY Inc. and 5 other companies
14 BIPROGY Inc., UNIADEX, Ltd. and UEL Corporation

80

KPIs in bold relate to Material Issues (p. 24-25)

FTSE Blossom Japan Sector
Relative Index



MSCI Japan ESG Select Leaders Index

MSCI Japan Empowering Women
Index (WIN)S&P/JPX Carbon
Efficient Index

ESG initiatives (Japanese only)

https://www.biprogy.com/sustainability/

FTSE Russell (a registered trademark of FTSE International Limited and Frank Russell Company) hereby certifies that BIPROGY Inc. has met therequirements for inclusion in the FTSE Blossom Japan Sector Relative Index as a result of independent research. The FTSE Blossom Japan Sector
Relative Index is widely used to create and evaluate sustainable investment funds and other financial products.

THE INCLUSION OF BIPROGY Inc. IN ANY MSCI INDEX, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOTCONSTITUTE A SPONSORSHIP, ENDORSEMENT OR PROMOTION OF BIPROGY Inc. BY MSCI OR ANY OF ITS AFFILIATES.
THE MSCI INDEXES ARE THE EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEX NAMES AND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF
MSCI OR ITS AFFILIATES.

BIPROGY Group Integrated Report 2023

81

Data Section

11-Year Financial Summary(BIPROGY Inc. and Consolidated Subsidiaries)(Millions of yen)

J-GAAP

Fiscal YearNet salesSystem services
Support services
Outsourcing
Netmarks services
Software
HardwareOthers
Gross profit
Operating income
Net income attributable to owners of
the parent
Capital expenditures

Depreciation and amortization

FY2012FY2015¥269,170
72,334
51,33432,356
21,75830,762
51,828
8,795
63,5458,311
1,250¥282,690
79,43649,14235,33626,486
31,33751,658
9,292
63,6109,574
6,305¥269,154
83,40455,24538,646–30,72751,337
9,793
63,442
10,924
7,246

10,440

10,321

9,821

12,352

Fiscal Year-End
Total assets
Total equity
Net interest-bearing debts
Shareholders’ equity

Equity ratio (%)

Net debt-to-equity ratio (Times)
Operating income per employee
BIPROGY Group Integrated Report 2023

Mid-Term Management Plan

FY2014

259,551

Other Information
Dividend payout ratio (%)
Operating margin (%)
Return on equity (ROE) (%)(FY2012–FY2014)

FY2013

Research and development costs
Net cash provided by (used in)operating activities
Net cash provided by (used in)investing activities
Free cash flows
Net cash provided by (used in)financing activities
OrdersPer Share Information
Basic net income per share (Yen)Net assets per share (Yen)
Cash dividends per share (Yen)82

Mid-Term Management Plan

8,573

4,861
18,447

4,659
11,8897,004(8,985)

3,600
(151)

(11,442)

FY2017FY2018¥278,039
89,82955,36240,496–30,00353,8738,474
64,61012,5258,920¥282,249
89,60754,07445,926–29,73354,0998,807
66,727
14,314
10,261¥286,977
90,50952,821
48,017–
33,10354,097
8,428
68,803
16,332
11,949

9,488

9,315

10,363

FY2020¥299,029
95,97253,57851,148–33,87754,677
9,776
73,16920,622
14,238¥311,554
102,91955,022
55,183–33,94355,098
9,387
79,79926,13918,182¥309,685
93,57253,03760,595–33,28757,647
11,546
81,07926,724
17,076

11,653

11,161

10,999IFRS

Fiscal Year
RevenueSystem services
Support services
Outsourcing
Software
HardwareOthers(10,586)(13,259)(11,206)

281,394

296,956

304,874

315,626

322,268¥193,094
91,21322,02090,374¥192,694
90,77221,00389,918¥197,278
104,674
10,529103,001¥211,421
116,615(3,375)
114,638¥214,975
122,598(11,020)
120,473¥231,980
136,887(22,815)
134,632

Fiscal Year-End
Total assets
Total equity
Net interest-bearing debts
Equity attributable to owners of parent¥77.07861.5320.00¥93.71847.51
30.00¥96.49896.3935.00¥119.121,026.72
40.00¥141.90
1,142.41
55.00¥181.19
1,200.32
70.00¥170.13
1,341.04
70.00

26.0
4.1
9.7

32.0
4.5
10.5

36.3
5.1
11.4

33.6
5.7
12.4

38.8
6.9
13.1

38.6
8.4
15.5

41.1
8.6
13.4

4,337
18,037

11,631

4,036
10,989263,478

279,415¥197,779
67,91640,85866,505¥202,468
76,01638,47374,796¥199,772
81,97533,66581,021¥13.31707.5710.00¥67.08795.61
15.00

75.1
3.1
1.9

22.4
3.4
8.9

0.51
1.12

FY2019(Millions of yen)

(13,227)

14,191

309,790

0.61
0.94(FY2018–FY2020)

Gross profit
Operating profit
Profit attributable to owners ofparentCapital expenditures (tangible/
intangible)
Depreciation and amortization(tangible/intangible)
Research and development expenses
Net cash provided by (used in)operating activities
Net cash provided by (used in)investing activities
Free cash flows
Net cash provided by (used in)financing activities
Orders(10,565)

36.9

Mid-Term Management Plan

FY2016(10,548)

33.6(8,289)(FY2015–FY2017)

7,489(12,886)

40.6

0.42
1.32

424
(8,186)

46.8

0.24
1.54

14,781

3,454
29,922(15,906)

14,015(11,756)

46.7

0.23
1.79

11,473

2,998
26,956

13,728(12,977)

52.2

0.10
2.08

8,183

3,958
27,43816,852(8,226)54.2(0.03)
2.66

10,3364,512
27,53914,280(8,202)56.0(0.09)
3.33

12,038

4,952
31,933

20,726(8,177)58.0(0.17)
3.37

Per Share Information
Basic earnings per share (Yen)
Diluted earnings per share (Yen)
Equity attributable to owners ofparent per share (Yen)Dividends per share (Yen)
Other Information
Dividend payout ratio (%)
Operating margin (%)
Return on Equity attributable toowners of parent (ROE) (%)
Ratio of equity attributable toowners of parent to total assets (%)
Net debt-to-equity ratio (Times)
Operating profit per employee

Management Policies(FY2021–FY2023)

FY2020

FY2021

FY2022¥308,426
94,14753,26459,54732,34157,490
11,635¥317,600
103,101
51,53763,43734,08955,158
10,275¥339,898
115,726
52,401
66,73037,41056,665
10,963

79,217
24,624
16,63983,13827,425
20,49089,35029,673
20,203

10,196

9,394

11,694

4,952
40,567(11,583)

28,983(16,301)

9,091

14,7204,121
29,435

3,953
28,419(10,957)

18,477(16,118)

9,101(15,537)

12,882(18,043)

324,285

326,961

362,094¥254,035
113,986
1,150
112,271¥268,647
130,674(6,862)
128,917¥280,396
141,597(5,640)139,887¥165.78
165.181,118.31¥204.04
203.381,283.45¥201.06
200.48
1,391.89

42.2
8.0
15.5

41.7
8.6
17.0

39.8
8.7
15.0

70.00

44.2

0.01
3.08

85.00

48.0

(0.05)
3.39

80.00

49.9

(0.04)
3.65

BIPROGY Group Integrated Report 2023

83

Main Themes and Concerns in Our Dialogue with Shareholders and Investors

Q The state of our outsourcing business and its growth potential
Q Our shareholder returns policy
Q Recruitment, turnover and other information on the situation with securing

P.35
P.36-39human resources

P.42-43、P.56-59

Q The loss of USB flash drives

will thoroughly implement measures to prevent reoccurrence and continually work
A We
towards bolstering the likes of information security measures.

Regarding the loss of USB flash drives containing the personal information of residents of Amagasaki City that
occurred in June 2022, we would like to offer our deepest apologies to the residents of Amagasaki, the City ofAmagasaki and other parties concerned for any inconvenience and worry this incident may have caused. We
have been endeavoring to thoroughly implement measures to prevent reoccurrence taking also into accountthe investigative results and recommendations of the third-party committee made up of external experts that
we established following this case, and continue to take action with the aim of reinforcing our information
security measures and the management and oversight of our contractors. The entire Group will do its utmost
in order to restore the trust of our shareholders, investors and other stakeholders.
Promotion of Information Security

P.70-71

For details on our response to the loss of USB flash drives, please see the below website. (Japanese only)

https://www.biprogy.com/com/info_security/info202206.html

Q Please talk about the business situation at BIPROGY’s main subsidiary(UNIADEX), Ltd.

Ltd. is a company that aims to provide excellent service exceeding customer
A UNIADEX,
expectations as a trusty advisor for total optimization of ICT environments.

The company plays an important role in the BIPROGY Group’s vendor-free and one-stop support capabilities.
Its strengths largely lie in multi-cloud services, next-generation networks, digital transformation (DX) and IT
outsourcing. As an expert in ICT infrastructure, using its advanced technical prowess as a foundation, UNIADEX
supports the creation of future-oriented mechanisms through the provision of its sincere service. In addition
to traditional network business, the company derives solutions for business issues faced by its customers by
newly making full use of multi-cloud platforms. Plus, by providing complete cloud security, UNIADEX contributes to the promotion of smooth business. For efforts to promote DX aimed at business reforms on the customer side, the company will also create new business value while supporting those customers.

Q Please discuss the situation with the relationship and synergy that BIPROGY has with its
Amajor shareholder Dai Nippon Printing Co., Ltd.

We are strengthening our collaboration to expand synergies by leveraging the expertiseand technological capabilities of both companies.

Since forming a capital and business alliance with Dai Nippon Printing Co., Ltd. (DNP) in 2012, we have promoted
sales collaboration, new market development, and expansion of the service business base. We are steadily generating greater and greater results in this business collaboration utilizing both companies’ strengths. Going forward, we
will continue to enhance synergies between the two companies by providing the DNP Group with the expertise that
we at the BIPROGY Group have cultivated to date regarding topics such as the launch of new businesses throughcollaboration and support for the DX of both groups’ customers and even quality control processes and IT humanresource development programs. Additionally, we will tie the utilization of assets accumulated through collaboration between both entities into the growth of the business revenue of the entire BIPROGY Group as well.
Examples of collaboration
Rollout of electronic library and electronic textbook delivery services
“Demonstration project for the creation of examples of resolving regional issues with the use of teleworking” by
the Ministry of Internal Affairs and Communications (Tentative title translated from Japanese)84

BIPROGY Group Integrated Report 2023

Data Section

Glossary
Term

BIPROGY Users Association

Business Ecosystems

Core-banking system
Corporate Venture Capital(CVC)
Digital Commons

Digital Transformation
(DX)

ICT
Intrapersonal diversity
OMO

Open innovation
Proof of Concept(PoC)
Public cloud
SaaS
Security incident
Social implementation
SIer/System Integration
Talent management system

Vendor-free
Zero emission

Explanation

The BIPROGY Users Association is comprised of BIPROGY Group users. Established in 1953, it has thelongest history of any IT-related user association in Japan. Research activities by BIPROGY Users
Association members and BIPROGY Group employees providing them with advisory support are not
only spread amongst association members but also widely publicized through regular symposiums
and association newsletters.
A registered trademark of BIPROGY Inc., Business Ecosystems are systems in which multiple
companies and organizations form partnerships to create businesses that solve social issues, andcoexist and co-prosper beyond the boundaries of industries and business sectors by utilizing theirrespective technologies and strengths.

Core-banking system refers to the system that performs core business processing such as deposits,loans, and exchange among the business systems of financial institutions.

CVC is an investment by a business company in a venture company, etc. for the purpose of acquiring
ideas and technologies that contribute to the creation of new businesses, or an organization thatengages in such investment activities.
Digital Commons are communities where it is possible to create both social and economic value insolving social issues by using digital technology to make it possible to widely use privately owned
assets (assets owned by companies, organizations, and individuals) and surplus assets (assets with
low utilization rates) that already exist in society as shared assets with low additional costs.

Digital transformation refers to not only transforming products, services, and business models basedon the needs of customers and society but also transforming operations themselves, theorganization, processes, and corporate culture and climate and establishing a competitive
advantage by using data and digital technology to respond to rapid changes in the businessenvironment.
Short for Information and Communication Technology. Specific expression that includes
communication technology along with IT. Technologies are developed with the sharing of
information and knowledge through network-based communication in mind.

Intrapersonal diversity is the idea that having a diversity of experiences in one person has the same
effect as diversity.
Short for Online Merges with Offline

Open innovation refers to the creation of innovative business models, products, and services bycombining technologies, ideas, and resources not only from within a company but also from outsidecompanies and organizations.
PoC is a verification aimed at demonstrating the usefulness and feasibility of a service idea orconcept.

A public cloud is a service that provides cloud computing, including servers, storage, databases, andsoftware, to an unspecified number of users, including companies and individuals, via the Internet.
SaaS (Software as a Service) is a form of software distribution in which only the functions of thesoftware that the user needs are made available as a service.
Security incident is an incident or accident that poses a security threat. It includes malware
infection, unauthorized access, and leakage of confidential information.

Taking services and mechanisms utilizing digital elements and technologies that lead to solvingsocial issues and making them widely available to society.

SIer is short for System Integrator. Business operator who undertakes the building, operation,
maintenance, etc. of the information systems of companies and other entities. Such IT services arereferred to as system integration.

A centralized management mechanism converting employee information, such as basic information,abilities, skills, and experience, into data. By analyzing data and linking it to strategic humanresource development and human capital allocation, these mechanisms are said to be effective in
improving productivity, management efficiency, and the ability to execute business strategies.
Vendor-free refers to the ability to provide services that optimally combine products from a variety of
manufacturers, without having to stick to a specific manufacturer.
Zero emission refers to reducing to zero the amount of waste generated from production activities
that undergoes final disposal. In a broader sense, it refers to a resource-recycling social system that
does not produce any waste by effectively using waste as raw materials.

BIPROGY Group Integrated Report 2023

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Data Section

Corporate Information(As of March 31, 2023)

Corporate Data
Company
Name

Stock Information
Independent
Deloitte Touche Tohmatsu LLC
Auditor

BIPROGY Inc.

Corporate Headquarters:
1-1-1 Toyosu, Koto-ku, Tokyo 135-8560, Japan

EstablishedMarch 29, 1958

Paid-in
Capita¥5,483.17 million

Descriptionof Business

Services business including cloud computing
and outsourcing; computer and network system sales/rentals; software development andsales; system-related services

Number of
Employees

Business
Offices

8,124 (consolidated)

Number of consolidated subsidiaries 27
Business Process

Marketing, Business Development andConsulting

Total Infrastructure Services
System Services

Outsourcing

Group Services

Regional Offices:
Hokkaido (Sapporo), Tohoku (Sendai),
Niigata (Niigata), Hokuriku (Kanazawa),
Shizuoka (Shizuoka), and Chugoku (Hiroshima)
Other Locations:
Sapporo Techno-Center, and Izu Executive
CenterCompany NameUEL Corporation
UEL (Thailand) Co., Ltd.
Cambridge Technology Partners, Ltd.
Cambridge Technology Partners Inc.
AFAS Inc.
Canal Globe, Ltd.
Axxis Consulting (S) Pte. Ltd.
Axxis Technologies (S) Pte. Ltd.
Axxis Consulting (M) Sdn. Bhd.
Canal Ventures, Ltd.
Canal Ventures Collaboration Fund 1 Investment Limited Partnership
Canal Ventures Collaboration Fund 2 Investment Limited Partnership
Emellience Partners, Inc.
Air Trust Corp.
Tech Viewing, Ltd.
Green Digital & Innovation Inc.
V-Drive Technologies Inc.
UNIADEX, Ltd.
Netmarks Information Technology (Shanghai) Co.,Ltd.
S&I Co., Ltd.
USOL VIETNAM Co., Ltd.
International Systems Development Co., Ltd.
G&U System Service, Ltd.
UNIAID Co., Ltd.
BIPROGY Challenged Inc.
TRADE Vision, Ltd.

BIPROGY USA, Inc.

(Note) AFON IT Pte. Ltd. and its subsidiaries became consolidated subsidiaries in April 2023.

Number of equity method affiliates 18

Regional Headquarters:
Kansai (Osaka), Chubu (Nagoya), andKyushu (Fukuoka)

Number of shares issued
Number of shareholders
Stock exchange listings

Principal Shareholders

109,663,524 shares

9,937 shareholders

Tokyo Stock Exchange, Prime Market(Stock code: 8056)

Classification of Shareholders
Foreign corporations
and individuals
26.53%
29,098,749 Shares
345 Shareholders

Individuals and others
6.34%
6,948,546 Shares
9,417 Shareholders

Other domestic corporations(including treasury shares)
30.30%
33,228,221 Shares
83 Shareholders

Number ofHolding
shares held
ratio
(Thousands(%)
of shares)

Name
Dai Nippon Printing Co., Ltd.

The Master Trust Bank of Japan, Ltd.
(Trust Account)
Custody Bank of Japan, Ltd. (Trust Account)
Mitsui & Co., Ltd.

The Norinchukin Bank

THE BANK OF NEW YORK MELLON 140044
JAPAN POST INSURANCE Co., Ltd.

BIPROGY Employees’ Shareholding Society

Financial institutions andsecurities companies
36.83%
40,388,008 Shares
92 Shareholders

The Master Trust Bank of Japan, Ltd.
(Retirement Benefit Trust Account,
Mitsubishi Electric Corporation Account)
STATE STREET BANK AND TRUSTCOMPANY 505223

20,727 20.62
14,542 14.46
14,289 14.21
2,448 2.43
2,326 2.31
1,818 1.80
1,710 1.70
1,530 1.52
1,271

1.26

1,150

1.14

(Notes)1. Number of shares less than one thousand has been omitted.
2. The Company retains 9,160,560 treasury shares without voting rights. Thus, they
are excluded from the major shareholder list above.
3. The ratios are calculated by deducting treasury shares and expressed by rounding
down to two decimal places.

Third-party Assurance

The following data is certified by a third-party assurance institution for the purpose of enhancing the reliability of reported data.
Environmental Data (FY2022)• Amount of Scope 1 GHG emissions (t-CO2e)•A mount of Scope 2 GHG emissions (t-CO2e), Location-based and Market-based• Amount of Scope 3 GHG emissions (t-CO2e) Categories 1-15
• Amount of total energy consumption (GJ, MWh, kL)• Amount of energy consumption (kL) and specific consumption (kL/m2)
based on the Act on the Rational Use of Energy•P ercentage of purchased electricity derived from renewable energy sources (%)• Amount of energy used (city gas (m3), heavy fuel oil A (kL), gasoline (kL),
LPG (m3), hot water (MJ), cold water (MJ), steam (MJ))• Amount of water used (m3)• Amount of waste emissions (recycled, landfilled, incinerated) (kg)• Amount of paper used (kg)Social Data (FY2022)• Percentage of employees with disabilities (%)• Employee turnover rate (%)• Percentage of management positions held by women (%)• Number of employees• Average age• Average years of continuous employment• Average annual salary (yen)• Percentage of eligible people taking childcare leave (men) (%)• Gender pay gap (%)

Independent Assurance Statement

https://sustainability-cms-biprogy-s3.s3.amazonaws.com/pdf/IAS_2023_en.pdf?230915

Statement of Responsibility

This integrated report primarily presents our initiatives on material issues and “Management Policies (2021-2023)”
toward the realization of the “Vision 2030” espoused by the BIPROGY Group. We prepared it while being mindful tocommunicate the story of the Group’s efforts to enhance its corporate value in an easier-to-understand manner as wellas to incorporate feedback and requests received from our readers.
Moreover, the report was prepared in cooperation with many associated departments within the Group, and was issued
after discussion and approval by the Sustainability Committee and the Executive Council. In addition, for material non-financial information, we have obtained assurance from a third-party assurance institution in our efforts to improve the reliability of our reporting content. As the officer in charge of the Finance Department, the department responsible forpreparing integrated reports, I declare that the process for preparing this report is proper and legitimate. We hope that thisreport will help our stakeholders better understand the Group and intend to use it to spur the realization of more beneficial
engagement with them. We would be grateful if you could continue to provide us with your honest feedback and requests.
Kazuma Umehara

Senior Corporate Officer and CFO

86

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BIPROGY Inc.

1-1-1 Toyosu, Koto-ku, Tokyo 135-8560, Japan
Finance Department

https://www.biprogy.com/e/
TEL: 81-3-5546-4111

Company names, product names and system names referred to in this report are
the trademarks or registered trademarks of their respective owners.
Copyright© 2023 BIPROGY Inc. All rights reserved.