Table of Contents
Sustainability Policy .................................................................................................... 4
1. Basic Policy ............................................................................................................... 4
2. Policy ........................................................................................................................ 4
Preventing Pollution ..................................................................................................... 5
Reducing waste and optimizing the use of resources .................................................... 5Conserving water .......................................................................................................... 5
Biodiversity ................................................................................................................... 5
2-2. Human Rights Policy ............................................................................................. 5(Preamble: Reference to the “International Bill of Human Rights”) ............................ 5(1)

Prohibition of child and juvenile labor and prohibition of forced labor ............. 6(2)

Prohibition of discrimination ............................................................................. 6(3)

Respect for freedom of association and the right to collective bargaining ......... 6(4)

Reduction of excessive working hours ................................................................ 6(5)

Minimum wage compliance; equal pay for equal work....................................... 6(6)

Rights of the child .............................................................................................. 6(7)

Occupational health and safety .......................................................................... 6(8)

Diversity and inclusion....................................................................................... 7

2-3. Employee Policy .................................................................................................... 8(1)

Training to improve employees’ skills ................................................................ 8(2)

Addressing harassment ...................................................................................... 8(3)

Health and safety ............................................................................................... 8(4)

A system that promotes engagement with employees and collaboration withcharitable partners .................................................................................................... 8
2-4. Supply Chain Policy (Preamble) ............................................................................ 8
Environmental protection ............................................................................................. 9
Respect for human rights .............................................................................................. 9
Health and safety .......................................................................................................... 9
2-5. Anti-Bribery and Anti-Corruption Policy.............................................................. 9
3. Initiatives ................................................................................................................ 11
3-1. E (Environmental) Initiatives .............................................................................. 11
Details of initiatives to reduce water consumption ..................................................... 11
Climate change awareness .......................................................................................... 11
Climate-related risks and opportunities ...................................................................... 13
Long-term (> 5 years) reduction target for GHG emissions ...................................... 14
Oversight of climate change risks by the Board of Directors ...................................... 15
Waste reduction and prevention targets ..................................................................... 15
Amount of nitrogen oxides (NOx), waste, and recycling for the past 3 years (tons) .. 15

1

Amount of environment-related fines and penalties ................................................... 15
Factory and site wastewater data for the past 3 years.................................................. 15
Total GHG emissions (Scope 1 and 2) for the past 3 years ........................................ 16
3-2. S (Human Rights and Labor) Initiatives .............................................................. 17
Initiatives toward labor issues ..................................................................................... 18
Health and safety initiatives ........................................................................................ 18
Principles of community investment........................................................................... 19
Results of local community investment ....................................................................... 19
Local employment, local procurement ........................................................................ 22
Company efforts to increase workforce diversity and equal opportunities, and to
reduce discrimination.............................................................................................. 22
Training for employees ............................................................................................... 24
Percentage of non-full-time employees (contract employees + temporary employees)................................................................................................................................ 29
Percentage of female employees ................................................................................. 29
Commitment to gender diversity by the Board of Directors ....................................... 29
Number of occupational accidents (fatalities) among full-time and contract employees
in the past 3 years ................................................................................................... 30
Policy and commitment to reducing adverse health and safety impacts ..................... 30
A system that promotes engagement with employees and collaboration with charitablepartners ................................................................................................................... 30
Total amount of donations/community investment by the Company or its Group
companies in registered nonprofit organizations. .................................................. 31
3-3. Governance (G) Initiatives .................................................................................. 32
Communicating to all employees regarding the Company anti-corruption policy ...... 32
Supervising risk management and reviewing of the effectiveness of risk management
processes by the Board of Directors, and risk responsibilities of senior management
including directors and executive officers .............................................................. 32
Review the following activities of the Company: Compliance with the Code of
Conduct/Code of Ethics and identify violations and/or periodically review theeffectiveness of the Code of Conduct/Code of Ethics ............................................ 33
Employee training on anti-corruption policy .............................................................. 33
Risk assessment of corruption in business .................................................................. 34
Disclosure of total amount of political contributions .................................................. 34
Number of actions taken against employees and dismissals resulting from violations of
the anti- corruption policy ...................................................................................... 34
Number of directors, number of independent directors, and number of female
directors .................................................................................................................. 35
Supervision and deliberation of the following items by the Board of Directors (misuse2

in conflicts of interest and related party transactions) ........................................... 35
Regular evaluation of the effectiveness of the Board of Directors .............................. 35
Disclosure of number of annual meetings of the Board of Directors/director
committee meetings Disclosure of attendance rate of directors and committee
members ................................................................................................................. 37
Disclosure of directors’ remunerations ....................................................................... 37
Disclosure of fixed and variable remuneration amounts ............................................. 38
Disclosure of compensation paid to audit firms .......................................................... 38
Exercise of voting rights concerning directors’ remunerations ................................... 39
Whether the principle of one voting right per share is applied to all corporate meeting
resolutions ............................................................................................................... 39
Disclosure of exercise of voting results ....................................................................... 39
Percentage of female executive officers (or equivalent positions) .............................. 40
Reporting standards – company risk management system and transparency of reports
with reference to external standards ....................................................................... 40
Supervision of the following by the Board of Directors (Code of Conduct, Code of
Ethics or any other equivalent rules, ESG risks):.................................................... 40
Responses to the following matters in accordance with the Company’s rules,
regulations/charter/policies and any other equivalent rule: ................................... 42
Company-wide approach to non-compliance.............................................................. 42
Supervision of health and safety by the Board of Directors ........................................ 433

Sustainability Policy
1. Basic Policy
Guided by our corporate philosophy (mission) of “striving to realize society from ‘build’ to ‘utilize,’” wecarry out our business with fairness and integrity. We embrace the challenge of creating businesses that
benefit society and work to become the Star Mica Group that pursues both growth and profitability.
Customers
With the customer’s perspective in mind, we constantly strive to improve the level of service that we offer,as professionals.
Business Partners
We build mutual trust and fair business relationships with our business partners, by preventing corruption
and taking other measures.
Local Communities
Through our business, we solve problems that are faced by Japanese society, and will maintain our position
as a company that is needed by Japanese society in the future.
Employees
We maintain a highly transparent governance structure, and create workplaces that provide employeeswith comfortable working environments.
Global Environment
By stimulating sales of existing homes, we contribute to reducing environmental impact, reducing CO2
emissions, and conserving the global environment.
Shareholders and Investors
We strive to disclose information in a timely and appropriate manner, and to actively communicate
through our investor relations efforts.

2. Policy
2-1. Environmental Policy
Climate ChangeWith the increase in greenhouse gases throughout the world and other factors, climate change is becoming
an increasingly serious issue, and it is seen as a challenge that must be addressed on a global scale. Efforts
to reduce greenhouse gases are being advanced on a global scale against the backdrop of the Paris Agreement,
which is the international framework for 2020 and beyond, etc., and the spread of renewable energy andenvironmentally friendly products and services is becoming increasingly important. Climate change in themedium to long term could affect residential demand, which would impact the Group’s operations.
As a company that promotes the restoration and distribution of homes, which are the foundation of all
people’s lives, the Group recognizes that its challenge is to contribute to climate change mitigation and to
conduct its corporate activities considering the risks and opportunities that climate change presents to thebusiness environment. We are committed to reducing greenhouse gas emissions and mitigating climatechange while aiming for business growth.

4

Preventing Pollution
Amid calls around the world for environmental preservation, the Group recognizes that a key task in ourbusiness activities of housing supply is to prevent environmental pollution through the effective use oflimited resources. We not only comply with laws and regulations, but also respect international codes ofconduct and work to prevent global environmental pollution, address climate change, and create a recyclingoriented society, including the sustainable use of resources.

Reducing waste and optimizing the use of resources
The Group recognizes that reducing waste and optimizing the use of resources and energy are global
challenges. We work to protect the global environment by contributing to the spread of renovatedcondominiums, which are more resource-efficient than residential construction. At the same time, we
conduct renovations in a way that considers waste reduction by making use of what can still be used and also
strive to develop renovation technologies that enhance the efficiency of resource and energy use.

Conserving water
Amid climate change, deforestation, population growth, etc. throughout the world, there is mounting
concern about the risk of water shortages. Although the Group does not own its own factories, etc. and uses
only a small amount of water, the use of water is essential for office operations and renovation work. We
recognize the need to curb any water use beyond what is necessary.
The Group is committed to fulfilling its social responsibilities as a company that promotes the restorationand distribution of homes, which are the foundation of all people’s lives. Our efforts not only include
improving the efficiency of water use by saving water during our office operations and renovation work, butalso increasing our engagement in water conservation across the supply chain.

Biodiversity
The Group recognizes that, as one of the environmental issues, consideration of biodiversity is a global
issue. Helping to sustain ecosystems supports the protection of the earth’s environment and it closely links
to the realization of a sustainable society, which is closely related to our corporate philosophy of “striving
to realize society from ‘build’ to ‘utilize.’”
In its business activities, the Group promotes projects that utilize existing housing stock rather than those
involving development. In this way, we reduce or avoid negative impacts on biodiversity, helping to realize
a society in which people and living things can continue to coexist in harmony.

2-2. Human Rights Policy(Preamble: Reference to the “International Bill of Human Rights”)
The Group recognizes that respect for the human rights of all people must be observed in order to continue
to fulfill its basic policy of conducting business with fairness and integrity.
The Group respects the human rights of all people in accordance with the “International Bill of Human
Rights” (“Universal Declaration of Human Rights” and “International Covenants on Human Rights”), the“ILO Declaration on Fundamental Principles and Rights at Work,” “The Ten Principles of the UN Global”
and “Guiding Principles on Business and Human Rights,” as well as relevant laws and regulations in the
countries and regions where the Group operates. Should a conflict arise between national or regional laws
and international norms, we look for ways to respect internationally recognized principles of human rights.
This human rights policy applies to the management of the Group and to all our employees.

5(1) Prohibition of child and juvenile labor and prohibition of forced labor
The Group prohibits all forms of forced labor, human trafficking, and child labor, and works to correct or
eradicate labor practices that violate human rights.

(2) Prohibition of discrimination
To maintain and improve its corporate value and develop its unique business model, the Group has since
its founding hired employees with a variety of work experience. In recent years, we have also actively
recruited new graduates. We respect diversity in our hiring and do not tolerate discrimination based on
gender, age, nationality, race, religion, or disability. In evaluation, remuneration, and promotion, we make afair judgment based on the individual’s ability and performance.
When appointing core personnel, we make fair judgments based on their abilities and performance inaccordance with their expected roles. Gender, age, nationality, type of employment, etc. do not influencesuch judgments.

(3) Respect for freedom of association and the right to collective bargaining
The Group recognizes that it is essential to respect the human rights of workers and respects theirfundamental rights related to labor, including the freedom of association and the right to collective bargaining.

(4) Reduction of excessive working hours
The Group strives to comply with applicable laws regarding wages, working hours, overtime, and benefits.
In addition, we comply with the “Article 36 Agreement,” striving to prevent overwork as a basic policy of
our labor management.
We not only comply with applicable laws but also strive to ensure proper labor management and reduce
excessive working hours.

(5) Minimum wage compliance; equal pay for equal work
The Group complies with applicable laws and regulations on wages and allowances, and always pays
remuneration above the statutory or industry minimum wage. In addition, we apply the same remuneration
system wherever qualifications, grades, etc., are equivalent, with no discrimination based on gender.

(6) Rights of the child
The Group believes that it is necessary to give special consideration to the human rights of children, who are
the key to the future of society. We agree with the content of the “Convention on the Rights of the Child”
and other conventions on the rights of the child as set forth by international organizations. We work to ensurethat all the Group’s business activities do not violate the rights of children. We are also aware that theGroup’s business activities in the supply of housing are essential to ensuring that children have an appropriate
living environment, and we strive to supply high-quality renovated condominiums.

(7) Occupational health and safety
The Group recognizes the importance of ensuring occupational health and safety not only for its
employees but also for its business partners, investors, and other related parties. We carry out our businessactivities based on the following policies.
If the activities of internal or external stakeholders are affected by deficiencies in the occupational healthand safety environment, we work with the relevant parties to find a solution based on the following policies.
1. Ensure that management respects consultation with employees, recognizing that good communication isnecessary for securing safety and health.

6

2. Respect various laws and regulations related to health and safety, establish voluntary standards asnecessary, and improve the level of health and safety management.
3. Develop an organizational system and clarify responsibilities to promote health and safety activities.
4. Provide all employees with a sufficient level of education and training they need to maintain health andsafety in order to promote a comfortable and healthy workplace.

(8) Diversity and inclusion
The Group promotes diversity and inclusion. This means that in a society of diversifying values andlifestyles, in order to design our renovated pre-owned condominiums from the standpoint of the consumers,
we must ensure diversity among the people who work for the Company, recognize people of all backgrounds
equally, whatever their profile may be in terms of attributes such as gender, age, or nationality, and give our
employees a place to thrive according to their personalities and abilities, placing the right people in the rightjobs. In addition, as a promoter of diversity and inclusion, the Board of Directors will take the lead inachieving this goal.

7

2-3. Employee Policy(Preamble)
The Group has adopted “STARMICA way.” as one of its employee action guidelines. Each and every
employee provides the best possible service to all stakeholders as a professional. As a company, we strive to
instruct and train our employees.

(1) Training to improve employees’ skills
The Group strives to develop both the Company and its employees. We provide training opportunities thatenable employees to improve their skills in order to build an environment where all employees can grow as
professionals.

(2) Addressing harassment
The Group has introduced an internal whistleblowing system for dealing with violations of internal rules,
regulations, etc. and harassment. The internal whistleblowing system ensures the anonymity of those
providing information and establishes multiple points of contact, including compliance officers, Audit &Supervisory Committee Members, and external law firms, which makes the system easier to use for those
providing information. By establishing a point of contact independent of management and ensuring theprotection of informants, we strive to ensure that the effectiveness of the system and also to increase the trustfrom our employees.
In addition, to raise employees’ awareness of human rights, we conduct harassment training for all new
employees. This training teaches employees about trends and countermeasures regarding harassment bycovering specific case studies.

(3) Health and safety
The Group sees maintaining and promoting employee health as an important issue. As well as establishinga highly transparent governance structure, we are committed to creating a workplace that considers theworking environment of our employees.
We have established an organizational system and clarified responsibilities for occupational health andsafety, and health management that align with the suitability of each individual and workplace. We
continuously check our progress, striving to improve, maintain, and enhance our efforts.

(4) A system that promotes engagement with employees and collaboration with charitablepartners
Social contribution activities
Our founder, Mizunaga, applied his learning from the field of academia to management and established aunique business model for the Group. We therefore focus our social contribution activities mainly on thesame field, and our entire organization is committed to fostering the next generation of entrepreneurs.
Through these activities, we expect young talent to create new businesses that take advantage of local
characteristics and revitalize regional communities through business.

2-4. Supply Chain Policy(Preamble)
The Group views business partners as partners in working together to solve environmental and social
problems. We have established the following policies to enable us to fulfill our social responsibility as acompany throughout our procurement.
We will also inform our business partners of the matters listed in this policy, requesting that they ensure
their compliance and action.

8

Environmental protection-

Recognize the impact of material procurement on the natural environment.
Promote energy conservation, expand the use of renewable energy, and other actions to reduce CO2
emissions.
Reduce water consumption, ensure proper wastewater treatment, and conserve water resources.
Give consideration to biodiversity conservation, the surrounding environment, and local residents andcommunities, etc.
Build and operate environmentally friendly management systems.
Reduce waste and promote resource recycling through efficient use, recycling, etc. of resources andmaterials.
Take measures to prevent the pollution of water, soil, oceans, air, etc., and give consideration topreventing human health hazards.
Minimize waste, wastewater, and emissions, and ensure proper treatment in accordance with regulations.

Respect for human rights-

Prohibit child labor and forced labor.
Prohibit all forms of discrimination, including discrimination and harassment of all kinds.
Comply with international norms related to the above and the laws and regulations of the operation
countries and regions.
- Pay wages at or above the minimum wage required by laws and regulations, and reduce excessive
working hours.
- Prohibit direct or indirect involvement in any kind of human rights violations across our supply chain.

Health and safety-

Ensure the safety and health of everyone in the supply chain, providing and protecting an appropriate
working environment.

2-5. Anti-Bribery and Anti-Corruption Policy
The officers and employees of the Group respect and comply with all laws and regulations concerning theprevention of bribery and corruption. We do not tolerate violations of relevant laws and regulations for any
reason.
The Audit & Supervisory Committee periodically reports to the Board of Directors on the operational
status of the Anti-Bribery and Anti-Corruption Policy. Under the supervision of management, efforts are
made to prevent corruption.
We pay particular attention to preventing violations in the following items and do not tolerate corruption
in any form.
(1) Money laundering(i) Those involved in criminal activities such as terrorism, drug trafficking, bribery, or fraud may attempt
to “launder” the proceeds of their crimes to hide them or make them appear legitimate. Many countries
now have laws that prohibit transactions involving the proceeds of criminal activity and requiresafeguards to prevent inadvertent money laundering.

9

(ii) The Group complies with all laws and regulations related to money laundering and counter-terrorism.
We conduct transactions only with trusted partners involved in legitimate business activities.
(2) Bribery(i) The Group engages in price competition in the process of purchasing and selling properties andproviding services related to real estate. The officers and employees of the Group do not give or accept
bribes in any form, directly or indirectly. We also do not tolerate anyone acting on behalf of the Groupto give or accept bribes. The term “bribe” means a financial or other form of benefit.
(ii) Gaining an advantage by making improper payments is never acceptable and it exposes the individual
and the company to the risk of criminal prosecution.
(iii) Each of the following acts may be regarded as a bribe or unauthorized payment. As a general rule, we
do not engage in any of the following acts:
Offering or promising to give money, goods, or services to a government official or a customer
with the intent of inducing a transaction that is advantageous to the Group
Paying gratuities to public officials or employees of other companies to expedite paperwork
Paying a fee that is disproportionate to the service provided(iv) The officers and employees of the Group exercise due care in their relationships with public officials.
In many countries, gifts or unauthorized payments to public officials are prohibited by law. The sameis applied to foreign public officials. Consultants, intermediaries, or other persons who conductbusiness through third parties will be encouraged to ensure that such third parties also comply withthe above rules.
(3) Insider trading(i) Insider trading laws prohibit trading in company securities on the basis of material information (insider
information) that has not been disclosed to the public.
(ii) The Group supports fair and open securities trading. The Group’s employees do not trade in shares orother securities using insider information obtained from the Group or third parties during theiremployment. Furthermore, they do not disclose such information to others.
(iii) The officers and employees of the Group comply with the following items.
Do not use insider information that is a material fact as stipulated under insider trading
regulations to buy or sell, directly or indirectly, financial instruments related to a company orentity, including the Group
Do not recommend or suggest financial instruments to others based on insider information.
Maintain the confidentiality of insider information and do not communicate it to third parties.
(iv) The department in charge of compliance periodically checks the operational status of this Policy andreports it to the Audit & Supervisory Committee and the Board of Directors.

10

3. Initiatives
3-1. E (Environmental) Initiatives
Details of initiatives to reduce water consumption
Initiatives to reduce water consumption
We conduct awareness-raising activities throughout the Group to prevent water use beyond what isnecessary. By making all employees aware that water is a limited resource, we are working to raise awarenessof water conservation and the need to reduce water consumption.
We believe that the direct environmental impact of water use by the Group’s businesses is limited.
However, throughout the value chain, we check whether there are any business processes that have a negative
impact on water resources or that involve the use of large amounts of water. If such processes are found, wetake appropriate measures to improve them.

Climate change awareness
Examples of the risks and opportunities posed by climate change that the Group recognizes are as follows:
Impact on
financialperformance

Timeframe

Item

Details

Transition
opportunities

Advancement of renovation
technologies with smaller
environmental impact

The introduction of low
environmental impact
building materials andwater fixtures such as in
kitchens, will makerenovated condominiums
more energy efficient.
This creates anopportunity for the Groupto expand its businessthrough new products.

MediumMedium tolong term

Transition
opportunities

Increased awareness of thesmaller environmental
impact of renovatedcondominiums compared to
new construction

As the supply of new
condominiums continues
to decline, customers will
become more aware of thesmaller environmental
impact of a renovatedcondominiums compared
to a newly constructed
one. This will increase theopportunity for customers
to consider renovatedcondominiums as apurchase option. This isalso an opportunity for theGroup to expand its
market share.

MediumMedium tolong term

11

Item

Details

Impact on
financialperformance

Timeframe

Transition
risks

Introduction of carbon tax

The introduction of socalled carbon taxes, aform of taxation based on
greenhouse gas emissions,is expected to result inhigher costs such as
procurement costs ofrenovation materials, etc.,
company vehicle fuelprices, and electricity
prices.

Large

Medium tolong term

Transition
risks

Increased procurement costs
due to improved
environmental performanceof renovation materials

Advances in thedevelopment of materials
with a smaller
environmental impact anda broader uptake of thesetechnologies can be
expected to be passed on
to each material price.
While the spread ofmaterials with improved
environmental
performance is a greattransition opportunity, it
can put pressure on
profitability due toincreased renovation
costs.

Large

Medium tolong term

Physical risks

Increase in frequency andseverity of natural disasters

Extreme weather events
such as heavy rains or
typhoons are expected toresult in delays to businessactivities. This could leadto a decrease in thenumber of real estate units
purchased, an increase inrunning costs due to alonger renovation
construction period andlonger sales periods.
Indirectly, revisions oflaws and regulations
related to disastercountermeasures or the

MediumMedium tolong term

12

Item

Details

Impact on
financialperformance

Timeframe

expansion of hazard map
regulations could also
result in decreases ofappraisal value of theCompany-owned
properties.
Physical risks Increase in health hazards
caused by extreme heat (heatstroke, etc.)

Reduced operational
efficiency of employees
and the occurrence ofoccupational accidents are
expected to put pressure
on profitability.

MediumMedium tolong term

Physical risks Higher utility costs due tocold winters

Higher utility costs are
expected due to the use ofheating in offices, etc.
Indirectly, the increase inelectricity use andgreenhouse gas emissions
from heating use could bea cost-increasing factor
due to so-called carbon
taxes.

MediumMedium tolong term

Climate-related risks and opportunities
Of the climate change-related risks that the Group recognizes, the risks that it deems to have the potential
for significant impact on finance or strategy, and the details of these risks, are as follows. The Group has apolicy of regularly reviewing climate-related risks, including responses to the TCFD (Task Force on Climaterelated Financial Disclosures). Through this process, we periodically review the abovementioned risks andopportunities.
Type of specific risk: Introduction of carbon tax
With global warming, increases in maximum daytime temperatures and extreme weather events have beenreported around the world. The goal of society is to reduce greenhouse gas emissions to virtually zero by2050 and limit the rise in global temperature to less than 1.5 °C above pre-industrial levels. As one meansof achieving these goals, the introduction of a carbon tax is being discussed internationally. The Group has
also conducted a risk analysis of climate change and the various initiatives to combat it, considering them tohave both strategic and financial impact. The IEA World Energy Outlook 2023 projects a carbon tax of atleast 350,000 JPY/tCO2 by 2050. Currently, as of year 2023, the Group’s emissions are 158.1tCO2. If
estimated by the same amount of emissions, our tax burden is expected to increase by JPY55.3 mn. We haveidentified this as a significant financial risk for the Group.
While avoiding these risks, the Group will promote initiatives to reduce emissions with the aim of realizing
a decarbonized society. For Scope 2, which accounts for most of the Group’s emissions, we will promote

13energy conservation in our offices and the use of renewable energy during renovation work. For Scope 1 as
well, we will strive to achieve the reduction target by reducing our fleet of company vehicles and promoting
the switch to EVs.
Type of specific risk: Soaring material procurement costs
Recent unforeseen events, such as global climate change, have caused raw material prices to soar andenergy prices to rise, seriously impacting corporate procurement activities. Fluctuations in the availabilityof important physical resources (such as lumber and stainless steel) could cause the cost of sales to increase,which could adversely affect the Group’s business results and financial position. On the other hand, events
caused by climate change also have the potential to accelerate the development of environmentally friendly
products and contribute to the spread of materials and technologies that have a smaller environmental impact.
Therefore, while the spread of materials with high environmental performance is a transition opportunity, it
could at the same time put pressure on profitability if prices are passed on to each material, resulting inhigher renovation costs. Fluctuations in oil prices and high labor costs associated with the renovation
operations that are closely tied to our business activities could adversely affect the Group’s business results
and financial position.

Long-term (> 5 years) reduction target for GHG emissions
Greenhouse gas emissions reduction targets
To reduce the risks associated with climate change, the Group has set medium to long term targets for
reducing greenhouse gas emissions. In addition to taking early action to achieve the targets for Scope 1 and2 emissions, we will continue to examine ways of achieving the targets for Scope 3 emissions as well.
<Greenhouse gas emissions reduction targets>
2030: Scope 1 and 2: 40% reduction (intensity, compared to FY22)*Concept of Scope 1, 2, and 3
In accordance with the GHG Protocol Initiative, each refers to the following types of emissions.
- Scope 1: Direct greenhouse gas emissions by businesses themselves (fuel combustion, industrial
processes)- Scope 2: Indirect emissions from the use of electricity, heat, and steam supplied by other companies- Scope 3: Indirect emissions other than Scope 1 and Scope 2 (emissions from other companies related tothe activities of the business)

14

Oversight of climate change risks by the Board of Directors
The President’s Office formulates the basic policy for responding to climate change risks and reports on
this periodically to the Board of Directors. In this way, our response to climate change is overseen by the
Board of Directors. Although the Company does not currently have a position dedicated to managing ESG,
the CEO is responsible for managing and overseeing climate change risk.

Waste reduction and prevention targets
Topic

Details

Japan/Overseas

Targets

Compared to
FY22▲20.0% (Emission
intensity per unit ofrevenue)*1. The waste to be aggregated is limited to waste discharged directly by the Group and waste discharged
by the Group as the main contractor for the renovation work.
Waste reduction

Japan

Reduction of waste*1
generation intensity

Amount of nitrogen oxides (NOx), waste, and recycling for the past 3 years (tons)
Overview of environmental impact*1(Unit:)

FY21

FY22

FY23

NOx emissions

0.3kg

0.3kg

0.3 kgIndustrial waste

100t

118t

11t

Recycled waste

-

-

-

*1. The waste to be aggregated is limited to waste discharged directly by the Group and waste discharged
by the Group as the main contractor for the renovation work.

Amount of environment-related fines and penalties
Number of environment-related accidents and lawsuits
During FY23, the Group had no violations of laws or regulations, fines, penalties, or lawsuits related to theenvironment. There were no accidents affecting external parties or serious complaints.

Factory and site wastewater data for the past 3 years
Water consumption
(m3)

FY21

FY22

FY23

Total

2,363.4

3,102.2

4,278.6

Amount used in the
Company-owned
properties (renovation
work, etc.)

1,667.8

2,389.5

2,270.9

695.5

712.8

2,007.6

Other (company
housing, etc.)

15

Total GHG emissions (Scope 1 and 2) for the past 3 years
Greenhouse gas emissions (total volume, by scope)
FY21

FY22

FY23

Total(t-CO2)

154.8

192.6

158.1

Scope 1(t-CO2)

9.1

8.3

5.7

Scope 2(t-CO2)

145.7

184.4

152.4

Emission intensity perunit of revenue

0.41

0.39

0.32

368.9

482.1

488.7

(t-CO2/JPY mn)
Revenue(JPY mn)*Scope 1 and 2 aggregate target- Scope 1: Emissions from company vehicle fuel (direct emissions)- Scope 2: Emissions from the use of electricity in offices and the renovation work of theCompany-owned properties (indirect emissions)16

3-2. S (Human Rights and Labor) Initiatives
Policy on employment support and other initiatives
The Group provides job placement assistance to young people by hosting internship programs and otherprograms. Our programs go beyond merely introducing the Group’s business activities. We invite
participants to present business proposals based on their industry research and work experience as we strive
to help college students who are willing to work gain a sense of perspective about their careers.
Our policy on labor standards
The Group aims to realize a society that utilizes housing rather than building it. Through its corporate
activities, the Group aims not only to solve environmental and social issues but also to contribute to thesustainable development of society. With this goal in mind, we have established the Charter of Corporate
Behavior as a Code of Conduct. We conduct our activities with high ethical standards and social norms toensure that the Group is trusted by society and can grow sustainably. The Charter of Corporate Behavior isposted on the Company’s internal portal site, and it is also shared with all officers and employees of theCompany and its subsidiaries. In addition, our action guidelines (STARMICA way.) was developed from
employee surveys and helps to foster a culture of respect for individual dignity and respect for others. All
employees refer to the action guidelines during training at the time of joining the Company and on otheroccasions, such as meetings. This helps employees calibrate their own behavior from time to time.
Charter of Corporate Behavior
The officers and employees of Star Mica Holdings, Co., Ltd., and its Group affiliates comply withapplicable laws, regulations, the Articles of Incorporation, internal rules, etc., and act in accordance withhigh ethical standards and social norms as follows:
1. We correctly understand and comply with the laws and regulations and their spirit. We also ensure theproper management and protection of customer information and other information held by the Company.
2. We engage in fair, transparent, and free competition as we carry out our business. Through appropriate
transactions, we build relationships of trust and satisfaction with our business partners. We also maintainsound and normal relationships with political and administrative authorities. We take a firm stand against
antisocial forces and groups that threaten the order and safety of civil society.
3. We place importance on ensuring the reliability of our financial reporting. We communicate not onlywith our shareholders but also with the society at large, actively and fairly disclosing corporate
information.
4. We build a safe and healthy work environment and establish a fair and motivating work environment. In
doing so, we support the growth of the Company and its officers and employees.
5. We strive to build good relationships with society by considering the environment, and to contribute to
the development of society as a good corporate citizen.
6. The officers disseminate this Charter internally and externally to ensure its thorough implementation andestablish an effective internal system.
In the event of a violation of this Charter, we will take appropriate measures to resolve the problem,
prevent its recurrence, etc., and provide prompt and accurate explanations both internally and externally.

17

STARMICA way.
1. Open and flat: Communication is open and flat.
2. Teamwork: Appreciation and respect are the basics of teamwork.
3. Professional: Professionals are people who continue to learn.
4. Clean smart: The goal is to be work smart.
5. Speed: Act with surprising speed.
6. Sense of ownership: Take ownership and what needs to be done comes into view.
7. Shared vision: Leaders share vision and take action.
8. Growth: Age or background do not matter; drive and ambition are what counts.
9. Challenge: Take on challenges with no limits or regrets.
10. Innovation: Be a cool company.

Initiatives toward labor issues
When hiring employees, the Group thoroughly verifies the age of candidates from the standpoint ofpreventing child labor. In addition, we carry out our hiring based on applications received directly from theindividual. Our employment regulations stipulate that the working conditions shall be made clear at the timeof hiring by referring to the notice of working conditions and the employment regulations. This prevents
work that is against the individual’s will.
We encourage efficient working styles in our daily operations. Specifically, we promote digitalization
under “work smart” in the “STARMICA way.,” our action guidelines. While being a small but specializedorganization, we promote the sharing of documents using cloud systems, etc. and the use of mobile devices
as we strive to enhance labor productivity.
Furthermore, we strive to reduce long working hours. Managers strive to monitor employees’ workloads
and coordinate as necessary. In this way, we have established a corporate culture that encourages employees
to return home early. With regard to working hours, we conduct company-wide monitoring, and we basicallyrequire employees to apply in advance if there is a possibility that their scheduled working hours may exceed
a certain number of hours. When overtime arises, we hold a meeting with the department head and take
immediate measures to improve the situation. Employees currently work an average of 18.0 hours per monthof overtime.

Health and safety initiatives
The Group has established Health Committee Regulations to prevent health problems among employees
and to maintain and promote their physical and mental health. The Health Committee is consisted of a
selected person who oversees the business, an occupational physician, a health manager, and representativesof employees. Through monthly committee meetings, the committee engages with managers and employees
to understand the details of occupational health and safety as it works to strengthen the system. Throughthese efforts, the Group works to maintain and improve the health of its employees and to create acomfortable working environment.
Introduction of M3 Patient Support Program (M3PSP)
We have introduced employee programs that can be used as part of health promotion. Subscribers gain
access to services such as obtaining a second opinion from a physician and finding a hospital.
Introduction of safety confirmation service
We have introduced a service to prepare for the event of a major disaster, which could happen at any time.
The service enables the safety and health status of employees to be ascertained in the event of an emergency,
making smooth recovery without disrupting operations possible, and also contributing to the psychologicalsafety of employees.

18Principles of community investment
Approach to social contribution activities
Through its business, the Group purchases owner-change properties, which are generally considereddifficult to distribute on the market, and sells them as renovated condominiums where strong demand is
expected. This improves the circulation of real estate across Japan and provides housing to those who wish
to become local residents, contributing to the revitalization of local communities.
Furthermore, as an additional social contribution activity, we conduct internship programs to provide
opportunities for college students who are willing to work so that they can gain a sense of perspective on
their career through industry research. We also conduct entrepreneur development activities througheducational institutions. In our activities through educational institutions, we share the history of our Group
from its start-up phase to the present with the younger generation. In doing so, we hope not only to encourage
the younger generation in the region to become more work-minded and growth-oriented but also to revitalize
the local community by fostering and discovering talented individuals through the transmission ofentrepreneurial know-how.
The growth of businesses launched by entrepreneurs trained by the Group has the potential to create newjobs in the region and to form a virtuous cycle in the economy. We also believe that if innovations in thefield which combines real estate and IT, etc., are created by the innovative ideas of the younger generation,
we can utilize those ideas in our business to diversify our profit opportunities and ultimately lead to the
expansion of the Group’s business.

Results of local community investment
Internship programs
Our programs go beyond merely introducing the Group’s business activities. We invite participants topresent business proposals based on their industry research and work experience as we strive to help college
students who are willing to work gain a sense of perspective about their careers.

19Calendar year
2019

Name

TargetSummerAugustSeptember

Graduatesof March
2021

11

77h

18 (1) Work experience through group work
(Calculation of the purchase price of preowned condominiums, preparation ofrenovation plans, etc.)(2) Roundtable discussion with employees

162h

12

126h

22 Same as above

242h

24

252h

17 Same as above

226hAutumnOctoberNovember

21

240h

WinterDecember

627h

26 Same as above

344h

AutumnOctoberNovember

32

448h

WinterDecember

5

15h

209

2,264hSummerAugustSeptember

Graduatesof March
2022

SummerAugustSeptember

Graduatesof March
2023

AutumnNovemberDecember
2022

2023

Total

Duration
105h

AutumnNovember
2021

Details

15 (1) Observe and experience the work of
employees(2) Create and present a personal history
presentation(3) Roundtable discussion with employees

WinterDecember2020

Number ofparticipants

SummerAugustSeptember

SummerAugustSeptember

Graduatesof March
2024

Graduatesof March2025

20Lectures
Since 2007, Mizunaga, the CEO of the Company, has given lectures at various locations around thecountry. Over the past five years, he has given the following lectures at graduate schools, companies, etc.
Although the lectures are mainly given by Mizunaga, employees also take part in these activities, mainly
when holding lectures at the Company. Roles carried out by employees include planning and developing
lecture content, managing the event on the day, or delivering part of the lectures to share their insights withparticipants.
Major activities
Number ofparticipants

TimingName of academic
institution

Lecture title

March 2018

Wharton (University ofPennsylvania)
MBA / EMBA

“Professional Career andEntrepreneurship”

30

July 2018

Keio Business School,
Graduate School ofBusiness Administration,
Keio University
Asia Business Field
Study Program“Professional Career andEntrepreneurship”

42

June 2019

Kyoto University Career
Seminar“If I were a college student again”

80

July 2019

Waseda Business School(Graduate School ofBusiness and Finance)“The Business of STARMICA Strategy in Practice”

13

March 2022

Hitotsubashi University
Business School
School of International
Corporate Strategy“Professional Career andEntrepreneurship”

50

Number of lectures and participants (by calendar year)
Calendar year
2018
2019
2020
2021
Number of2200
lectures
Number of72
93
00
participants*In 2020 and 2021, activities were restricted due to the spread of COVID-19.

21

2022

2023
1

0

50

0

Establishment and operation of the foundation
In 2021, Mizunaga, the founder, played a central role in establishing the Star Mica Mizunaga Foundation
for the following purposes.
(1)
(2)
(3)
(4)
(5)
(6)

Promote academic studies toward remedying social problems
Support education to nurture future leaders of society
Contribute to the promotion of academia, culture and the arts
Promote industrial activity that contributes to the development of society
Contribute to the promotion and revitalization of real estate distribution centered on pre-owned homes
Promote other studies and research for more innovative and sustainable development of society

Going forward, we will carry out various activities to contribute to the development of academia,
education, culture, and industry, and to help realize a recycling-oriented society.

Local employment, local procurement
The Group contributes to local community activities through its business and social contribution activities.
In particular, since 2018, we have expanded our bases to regional core cities (Sapporo, Sendai, Nagoya,
Osaka, Kobe, and Fukuoka). As we have done so, we have been actively hiring local human resources. Also,in the renovation work, we have been working with local companies as we work to contribute to thedevelopment of each region.

Company efforts to increase workforce diversity and equal opportunities, and to reduce
discrimination
Employee diversity and equal opportunities
The Group strives to provide equal opportunities in the workplace. As well as ensuring that our hiring
practices do not discriminate on the basis of gender, we also have a training and mentoring system that does
not discriminate on the basis of gender.
Furthermore, we have put in place the following systems, which expand on the legal system, and we haveestablished a system that does not limit our employees’ opportunities.
(1) We have introduced systems for antenatal and postnatal leave, childcare leave, shortened working hours,
and nursing care leave. Our system of shortened working hours can be used by employees, whether
male or female, until their children’s graduation from primary school.
(2) Employees who have nursing care responsibilities and who meet certain requirements can use theshortened working hour system while caring for their family members.
(3) We have a rehiring system for promoting employment of the elderly. We strive to provide equal
opportunities to our employees by allowing those who wish to continue working to do so based on ourrehiring rules.

22

We are also especially focusing our efforts on the following areas:
Promoting the active participation of women
The Group believes that female perspectives are indispensable in the design of housing. We continue topromote the active participation of women by providing a variety of career development options for adapting
to changes in life stages, as well as benefits and subsidies that allow women to continue working with peaceof mind.
Promoting the employment of foreign nationals
The Group believes that responding to the needs of globalization requires a perspective that is not boundby Japanese cultural norms. We actively employ foreign nationals and establish a workplace where they canwork with peace of mind and also provide support in their daily lives as appropriate.
Active employment of the elderly
With the extension of healthy life expectancy, our society has become a place where people can work
longer, and the labor force of senior citizens is a major driving force behind Japan’s economy. The Group
actively employs the elderly and creates opportunities for them to utilize their skills and knowledge inbusiness while helping to bring about vibrant lifestyles for the elderly.
Promoting the active participation of people with disabilities
The perspectives of people with disabilities can be expected to be a major asset in implementing barrierfree offices and the development of universally designed products. The Group is committed to creating aworkplace where employees can use their talents to work, regardless of whether they have disabilities, byrevising our operations to optimize and improve efficiency.
Promoting understanding of LGBTQ
Accepting sexual minorities helps ensure that we have the best talent. By recognizing and respecting
diverse values, we make our business more competitive. The Group does not discriminate against sexual
minorities in its hiring practices. We continue to establish internal systems and workplace practices thatconsider sexual minorities.
Overview and duration of skill development training for employees
In our action guidelines, we view individual growth as depending on motivation and ambition, and we
encourage our employees to continue learning. We have prepared a step-by-step curriculum that leads toskill development through various in-house training programs.

23

Training for employees
Fiscal year
implemented
FY19

FY20

Name

Target (affiliation)

Number ofparticipants

PurposeOverallduration(Total)

In-housepracticeexams for
Real EstateTransaction
Agentcertification

Full-time
employees

19 Passing the certification
examination

456h

Training for
new managers

Full-time
employees

6 Understanding the roles andexpectations required of amanager, and gaining therequired knowledge

12hReal estate
training

Full-time
employees
Contract
employees
Temporaryemployees

New graduates: Postassignment follow-up Midcareer: Acquiring industry
knowledge

232h

Follow-up
training fornewemployees

Full-time
employees

13 Post-assignment follow-up

78h

Renovation
training

Full-time
employees

58 Acquiring knowledge that
contributes to procurement
activities and productdevelopment

1,015hLabor
management
training

Full-time
employees

49 Acquiring knowledge ofattendance management
rules and laws andregulations

24.5h

In-housepractice exams
for Real EstateTransaction
Agentcertification

Full-time
employees

14 Passing the certification
examination

364h

Excel training

Full-time
employees

18 Learning basic functions of
Excel and improving work
efficiency

108h

13 new
graduates/new
employees
16 new midcareer
employees
29 in total

24

Fiscal year
implemented

Name
Real estate
training

Target (affiliation)

Number ofparticipants

Full-time
employees

Purpose18 New graduates: Postassignment follow-up

Overallduration(Total)
144hMid-career: Acquiring
industry knowledge

FY21

In-house
training

Full-time
employees

12 Fostering communication
with management andincreasing motivation

18h

Training for
new managers

Full-time
employees

4 Understanding the roles andexpectations required of amanager, and gaining therequired knowledge

8hFull-time
Follow-up
training for new employees
employees

12 Post-assignment follow-up

72h

Addressing a lack ofcommunication during the
COVID-19 pandemic

157.5hIn-house
training

Full-time
employees

12 in Year 1
11 in Year 2
12 in Year 3
35 in total

Training for
new managers

Full-time
employees

4 Understanding the roles andexpectations required of amanager, and gaining therequired knowledge

4h

Practical
brokerage
training foryoung
employees

Full-time
employees

9 Practical brokerage sales
training for planning andadministrative employeeswith no sales experience320hIn-housepractice exams
for Real EstateTransaction
Agentcertification

Full-time
employees

9 Passing the certification
examination

162h

Housing loans
training

Full-time
employees

96 Acquiring knowledge of
housing loans

528h

Labor
management
training

Full-time
employees

2 Acquiring knowledge ofattendance management
rules and laws andregulations

1h25

Fiscal year
implemented

Name
Real estate
training

Target (affiliation)

Number ofparticipants

Full-time
employees

Purpose5 New graduates: Postassignment follow-up

Overallduration(Total)
40h

Mid-career: Acquiring
industry knowledge

FY22

Year-end tax
adjustment
seminar

Personresponsible forhuman resources
and payroll

1 Acquiring practicalknowledge of payroll

6hIn-housepractice exams
for Real EstateTransaction
Agentcertification

Full-time
employees

14 Passing the certification
examination

308h

Training for
new managers

Full-time
employees

6 Understanding the roles andexpectations required of amanager, and gaining therequired knowledge

Real estate
training

Full-time
employees

20 New graduates: Postassignment follow-up

6h

460h

Mid-career: Acquiring
industry knowledge
Full-time
Follow-up
employees
training for new
employees
FY23

4 Post-assignment follow-up

48h

28 Passing the certification
examination

616h

1,230hIn-housepractice exams
for Real EstateTransaction
Agentcertification

Full-time
employees

Real estate
training

Full-time
employees

36 New graduates: Postassignment follow-up

Contract
employees

Mid-career: Acquiring
industry knowledge

Contract
employees

Renovation
training

Full-time
employees

47 Acquiring industry
knowledge

Management

Full-time
employees

25 Understanding the roles andexpectations required of amanager, and gaining therequired knowledge

training

26550h

1,150hFiscal year
implemented

Name

Target (affiliation)

Number ofparticipants

Full-time
Follow-up
training for new employees
employees

Purpose24 Post-assignment follow-up

Total

625

27

Overallduration(Total)
494h

8,636hSupport for obtaining a Master of Business Administration (MBA)This program provides time and financial support for employees to attend business school for the purposeof fostering personnel who are well versed in overall corporate management and who possess the highpersonal skills that would qualify them as candidates for our next generation of managers.
Support for obtaining various qualifications
This system encourages employees to obtain public qualifications as part of their skill improvement andself-development by providing all employees with a qualification allowance for those who obtain suchqualifications. Based on our Code of Conduct, which states that “professionals are people who continue tolearn,” we strive to foster a culture of continuous learning. We have established Real Estate Transaction
Agent certification as a mandatory qualification. We encourage not only sales employees but also
employees working in the planning and administrative departments (Accounting Division, Finance Division,etc.) to obtain these qualifications. The percentage of employees of the Group who hold Real EstateTransaction Agent certification is 96.7%.
Introducing a mentoring system
We have introduced a mentoring system to help employees get to know the climate and culture of theCompany. New employees are given a year to complete their training, while mid-career employees are
given six months to complete their training. The system enables them to gain a multifaceted perspective that
goes beyond the perspective of the department to which they are assigned. We also provide continuous
guidance to our employees so that they can become not only employees of the Company but also usefulmembers of society.
Mizunaga Seminar by the founder
We continue to hold seminar-style study sessions (known as the “Mizunaga Seminar”) in which
employees who aspire to become executives in the future give presentations on the Company’s issues andsolutions in front of top management and receive direct feedback.

28

Percentage of non-full-time employees (contract employees + temporary employees)*Total (all employees): Full-time employees, contract employees, temporary employees, and part-time
employees*Non-full-time employees: Contract employees, temporary employees
FY21
Total(Persons)
Percentage of non-full-time employees(Temporary, contract, etc./total, %)

FY22

FY23

177

202

219

20.9%

21.7%

18.7%

Percentage of female employees*Total (all employees): Full-time employees, contract employees, temporary employees, and part-time
employees
FY20

FY21

FY23

Total(Persons)

177

202

219

Of which, female(Persons)

96

112

125

Percentage of female (%)

54.2%

55.4%

57.1%

Managers and employees in equivalent
positions(Persons)

51

54

57

Of which, female(Persons)

13

15

17

25.4%

27.7%

29.8%

Percentage of female managers andemployees in equivalent positions (%)

Commitment to gender diversity by the Board of Directors
Efforts toward gender diversity in the Board of Directors
We believe that to continue meeting the diversified and complex needs of customers in the future, we needto design products that incorporate a variety of perspectives. In particular, women are often the decisionmakers in housing purchases by families, the main target group for our products. The perspective of womenis therefore vital when designing products that meet their needs. We have elected a director (female) at
26th Annual General Meeting of Shareholders, as an example of our effort to gender diversity of the Boardof Directors. We will strive to develop personnel systems and foster awareness in accordance with thevarious group companies, departments, and workplaces in order to raise the percentage of female managers
and employees in equivalent positions.

29

Lost time injury rate for the past 3 years
FY21

FY22

FY23

Lost time injury rate

0

0

0

Number of fatalities and injuries due tooccupational accidents (persons)

0

0

0

Total actual hours worked (hours):

0

0

0

*Lost time injury rate = number of fatalities and injuries due to occupational accidents / total number ofactual hours worked × 1,000,000*Number of fatalities and injuries: Including those absent from work for more than one day and those losing
a part of or function of their body

Number of occupational accidents (fatalities) among full-time and contract employees in thepast 3 years(Cases)Full-time employees

Contract
employees/contract
workers

FY21

FY22

FY23

Total

0

0

0

Fatalities

0

0

0

Lost time

0

0

0

Total

0

0

0

Fatalities

0

0

0

Lost time000Injuries, fatalities and incidents
During the three fiscal years from FY21 to FY23, the Group has had no instances of accidents involving
injury or resulting in the death of employees.

Policy and commitment to reducing adverse health and safety impacts
During the three fiscal years from FY21 to FY23, the Group has had zero instances of occupational
accidents, and the occupational accident frequency rate is also zero. Going forward, we will continue to
strive to maintain zero.

A system that promotes engagement with employees and collaboration with charitable partners
The Group’s employees have been actively involved in social contribution activities such as cleaning the
Zaimokuza beach in Kamakura city in Kanagawa Prefecture, coral transplantation activities in Okinawa
Prefecture and voluntary reconstruction work in Minamisanriku in Miyagi Prefecture.
Through the Star Mica Mizunaga Foundation, launched in FY21, we will carry out various activities
going forward, to contribute to the development of academia, education, culture, and industry, and to help
realize a recycling-oriented society, while continuing to support volunteer activities by our employees.

30Total amount of donations/community investment by the Company or its Group companies inregistered nonprofit organizations.
TimingDonation recipients / donation details

AmountMarch 2015

Kyoto University
Office of Society-Academia
Collaboration for Innovation
Establishment and operating expenses of the Endowed
Research Chair Innovation Management Science

JPY 5.0 mn

September
2015

Joso City
Aid for damage caused by the breakdown of embankments

JPY 1.0 mn

August 2021

Star Mica Mizunaga Foundation
Operating funds

JPY 3.0 mn

Internal dissemination of the Supplier Policy
The Group provides training to employees in the sales department to ensure that they are familiar with ourpolicies regarding the supply chain. The training program covers content based on the Basic Sustainability
Policy, developing employees who can perform their duties as professionals.

31

3-3. Governance (G) Initiatives
Comprehensive internal whistleblowing system that ensures confidentiality and anonymity
In order to disseminate and implement the Anti-Bribery and Anti-Corruption Policy, which is our basicanti-corruption policy, the Group introduced an internal whistleblowing system (including anonymous
reports) and operates it in a manner that ensures the anonymity of all informants. Points of contact are
established both inside and outside the Company, and they are open to receive reports from all Group
employees (including contract employees, temporary employees, etc.) in accordance with the Whistleblower
Protection Act. The person who received the report is obligated to strictly maintain confidentiality of any
information received.

Communicating to all employees regarding the Company anti-corruption policy
At the Group, the Investment Management Department, which is the department in charge of compliance,takes the lead in holding a meeting twice a year to explain each of the rules related to anti-corruption to all
employees in order to thoroughly inform them of anti-corruption measures.
Related regulations are disclosed on the intranet which is always available to officers and employees. In
addition, the Anti-Bribery and Anti-Corruption Policy, which is our basic anti-corruption policy, is includedin employee training to educate all employees, especially those working in departments with high risks ofcorruption.

Supervising risk management and reviewing of the effectiveness of risk management processesby the Board of Directors, and risk responsibilities of senior management including directors
and executive officers
The Group has established Risk Management Rules in order to identify and assess risks pertaining to theGroup as a whole, and take appropriate measures from both qualitative and quantitative aspects as necessary,and implements comprehensive risk management. Events subject to risk management include thosedescribed as Risk Information in the Company’s Annual Securities Reports and any other similar documents,
deficiencies in internal controls over the preparation of financial reports included in the Annual Securities
Reports, non-compliance with the stipulations in the Compliance Rules and any other material events that
impede the execution of business.
The content of risk management is shared between the senior management responsible for the department
in charge of risk management and the internal control division. The responsible person in the internal control
division regularly reports to the Board of Directors and the Audit & Supervisory Committee. Each director
is responsible for supervising and evaluating the effectiveness of risk management.
In the event that any of the aforementioned risks becomes apparent, a task force is established to takeappropriate measures, with the President & CEO serving as the head and the risk management manager
serving as the director-general of the task force. In addition, the effectiveness of risk management isconstantly reviewed by regular verification and evaluation through the CEO.
The head of the department in charge of risk management is served by a different employee (manager) fromthe chairperson of the Audit & Supervisory Committee.

32

Review the following activities of the Company: Compliance with the Code of Conduct/Code of
Ethics and identify violations and/or periodically review the effectiveness of the Code of
Conduct/Code of Ethics
The Group’s internal audit division independently evaluates and verifies the appropriateness andeffectiveness of compliance and other management systems at 9 sites, including subsidiaries. For internal
audits, they not only detect deficiencies, but also identify problems related to compliance at each site andprovide proposals and guide them to make improvements.
When a compliance violation is detected, it is reported to the CEO, Audit & Supervisory Committee
members, and the internal control division, as well as to the heads of the relevant divisions and the executive
officers and directors who supervise the relevant businesses. Necessary corrective measures are taken as wellas suggestions are provided to the relevant divisions in order to correct and improve problems. With regard
to ESG risks, the Board of Directors meet once a month to monitor the operation status and effectiveness ofCorporate Mission, action guidelines, Code of Ethics, etc.

Employee training on anti-corruption policy
The Group provides new graduate employees and mid-career employees with training on the significanceof anti-corruption and matters that may pose a particularly significant risk as stipulated in the Anti-Bribery
and Anti-Corruption Policy as part of the orientation they receive at the time of joining the Company. It also
provides training twice a year at the weekly meeting for all employees to familiarize them with anticorruption.

33

Risk assessment of corruption in business
The Group’s Investment Management Department, which is responsible for compliance, takes the lead inassessing the risk of corruption in its business, collaborating with the President’s Office, which is the internal
control division, as necessary. The results of risk assessment, particularly those determined to be significant
risks, are reported to the Audit & Supervisory Committee.

Disclosure of total amount of political contributions
The total amount of donations made by the Group to political fund organizations is as follows:

Donations to politicalfund organizations

FY21

FY22

FY23

N/A

N/A

N/A

Number of actions taken against employees and dismissals resulting from violations of the anticorruption policy
FY21
Employee, etc.
disciplined for violationof anti- corruption policy(number of persons)

FY22

0

FY23

0

1

Penalties related tocorruption (JPY)

-

-

-

Penalties related tocorruption (number ofcases)---

Disclosure of details by directors (expertise and experience as a director at other companies)
The following is a summary of the Company director’s professional background and experience in serving
as a director at other companies.
The expertise and concurrent positions of each director are described in the reference documents for thegeneral meeting of shareholders and the Annual Securities Report.

34

Name
Masashi Mizunaga

Expertise

Concurrent positions at other companies

Corporate management, sales/
marketing, financial accounting/finance, organizational personnel/
human resource development,sustainability-

Kazuhiko Odaki

Financial accounting/ finance, legal
affairs/ compliance, technology,
sustainability

Professor, College of Economics,
Nihon University
Outside Director of AS ONECORPORATION

Yasushi Yano

Corporate management, sales/
marketing, organizational personnel/
human resource development

Representative Director, Taisei CI Co.
Ltd.
Commissioned as a member of theManagement Council of Nishinoda
Technology Senior High School
Director, Kansai Association of
Corporate Executives

Tetsuo Wada

Sales/ marketing, financial accounting/ Professor, Faculty of Economics,
Gakushuin University
finance, legal affairs/ compliance

Izumi Saegusa

Sales/ marketing, organizational
personnel/ human resource
development, sustainability

Auditor, Oya Eiko Office Ltd.
Director, Oya Soichi Library Foundation

Number of directors, number of independent directors, and number of female directors
The Company is a company with an Audit & Supervisory Committee. We appoint one (1) director(excluding directors who are Audit & Supervisory Committee members) and four (4) directors who are
Audit & Supervisory Committee members (of which four (4) are outside directors).
Of the four (4) directors who are Audit & Supervisory Committee members, all four (4) meet theindependence standards set forth by the Tokyo Stock Exchange as well as the independence standards forindependent officers set forth by the Company.
The number of female directors is one (1).

Supervision and deliberation of the following items by the Board of Directors (misuse in
conflicts of interest and related party transactions)
The Group has determined that competitive transactions and transactions involving conflicts of interest by
its directors shall be resolved by the Board of Directors, and these transactions shall be deliberated by the
Board of Directors, including the independent directors, after disclosing material facts in advance. In addition,
the Group regularly checks whether there are transactions between related parties and the Company. Should
there be any transaction, it will be described appropriately in the disclosure documents as a related party
transaction in accordance with related laws and regulations.

Regular evaluation of the effectiveness of the Board of Directors
The Company conducts an anonymous questionnaire every year to all directors including outside directors
to evaluate the Board of Directors as a whole, and the results are confirmed at the Board of Directors.

35

Statements regarding the Board of Directors, the Audit & Supervisory Board, and eachcommittee, their rules and regulations, or descriptions equivalent thereto, and the Audit &Supervisory Board consisting solely of outside auditors and the exercise of voting rights
regarding the election and dismissal of directors
The structure of the Company meeting is as follows.
Board of Directors
The Board of Directors shall deliberate on important matters relating to the management of the Company,
including management policies and strategies, and supervise the execution of duties by directors. The termof office of directors who are Audit & Supervisory Committee members is two (2) years, and the term ofoffice of directors who are not Audit & Supervisory Committee members is one (1) year.
As of April 2024, the Board of Directors is composed of one (1) director who is not an Audit &Supervisory Committee member and four (4) directors (who are Audit & Supervisory Committee members),
and each director is elected at the general meeting of shareholders.
Audit & Supervisory Committee
In principle, the meeting of the Audit & Supervisory Committee is held once a month. The Committee
supervises the execution of business by directors, by attending meetings of the Board of Directors that
ensures appropriate management activities as well as other important meetings, viewing related materials,
and asking questions to department managers. Candidates are selected considering whether they are able tomaintain independence from business executives, whether they are able to maintain a fair and impartial
attitude, and whether they are able to conduct management evaluations, etc. Their term of office is two (2)years.
As of April 2024, the Audit & Supervisory Committee is composed of four (4) outside directors, and all
four (4) meet the independence standards set forth by the Tokyo Stock Exchange as well as theindependence standards for independent officers set forth by the Company.
Nomination & Remuneration Committee
A Nomination & Remuneration Committee meeting is held each time a proposal is submitted, and proposals
of director candidates and director remuneration are deliberated, and recommendations of director candidates
and opinions, etc. on director (excluding directors who are Audit & Supervisory Committee members)
remuneration are reported to the Board of Directors, whereas opinions, etc. on director (who are Audit &Supervisory Committee members) remuneration are reported to the Audit & Supervisory Committee. The
candidates for the Nomination & Remuneration Committee are selected by the Board of Directors fromamong the directors, including independent outside directors, and their term of office is one (1) year.
Proposals of director candidates and director remuneration are deliberated at the Nomination &Remuneration Committee, and recommendations of director candidates and opinions, etc. on director(excluding directors who are Audit & Supervisory Committee members) remuneration are reported to theBoard of Directors, whereas opinions, etc. on director (who are Audit & Supervisory Committee members)
remuneration are reported to the Audit & Supervisory Committee.
As of April 2024, the Nomination & Remuneration Committee is composed of five (5) directors andchaired by an outside director.

36

Disclosure of number of annual meetings of the Board of Directors/director committee meetings
Disclosure of attendance rate of directors and committee members
The number of days the meetings were held and the attendance rate of each committee member for FY23
(from December 1, 2022 to November 30, 2023) are as follows:

MasashiMizunaga

Kazuhiko Odaki

Yasushi Yano

Tetsuo Wada

Board of Directors

13/13

13/13

13/13

13/13

meeting(13 meetings in(100%)(100%)(100%)(100%)-

13/13(100%)

13/13(100%)

13/13(100%)

3/3

3/3

3/3

3/3

(100%)(100%)(100%)(100%)

total)
Audit &
Supervisory
Committee meeting(13 meetings in
total)
Nomination &Remuneration
Committee meeting(3 meetings in total)*The above does not include the four (5) written resolutions that are deemed to have been adopted by the
Board of Directors.

Disclosure of directors’ remunerations
At the extraordinary general meeting of shareholders held on May 24, 2019, the Company resolved that the
maximum amount of directors’ remunerations (excluding directors who are Audit & Supervisory Committee
members) shall not exceed JPY 300 mn per year (however, this excludes salaries of directors who
concurrently serve as employees). Remuneration is deliberated and determined by the Board of Directors
after thorough deliberation by the Nomination & Remuneration Committee, taking into consideration thequalities and capabilities of each director and their degree of contribution to performance of the Company.
In addition, the Company introduced a restricted stock remuneration system in 2021, and the Company will
provide eligible directors with remuneration for granting restricted stocks at an annual amount of up to JPY
200 mn (however, this excludes salaries of directors who concurrently serve as employees) as remuneration
for the execution of duties for five (5) years from the 23rd Ordinary General Meeting of Shareholders held
on February 24, 2021, within the current annual amount of monetary remuneration, etc. for directors of up
to JPY 300 mn.

37Disclosure of fixed and variable remuneration amounts
The directors’ remunerations of the Company for FY23 were as follows: (Unit: JPY thousand)Name

Total amount of
remuneration

Position

Fixed
remuneration

Non-monetary
remuneration

Director who is not an
Masashi Mizunaga Audit & Supervisory
Committee member

127,199

39,60087,599Kazuhiko Odaki

Director (Audit &Supervisory
Committee member)

3,000

3,000

-

Yasushi Yano

Director (Audit &Supervisory
Committee member)

3,000

3,000

-

Tetsuo Wada

Director (Audit &Supervisory
Committee member)

3,000

3,000

-

Disclosure of compensation paid to audit firms
The amount of compensation paid to KPMG AZSA LLC, which audits the Group, is as follows:

FY21
Fees for audit
certification
work

FY22

Fees for nonaudit services

FY23

Fees for audit
certification
work

Fees for nonaudit services

Fees for audit
certification
work

Fees for nonaudit services

Company

20,820-20,506-

24,967-

Subsidiary

5,790

-

6,524

-

8,008

-

Total

26,610-27,030-32,975-

Ordinary general meeting of shareholders: Number of days from the date of convocation notice tothe date of the meeting
In order to facilitate the exercise of voting rights by shareholders, the Company issues convocation notices
on its website and makes efforts to dispatch the notices earlier than the provision of Article 299 of theCompanies Act (by two weeks prior to the general meeting of shareholders).

38

Exercise of voting rights concerning directors’ remunerations
At the Company, the amount of directors’ remunerations, etc. provided in Article 361 of the Companies
Act is, in principle, determined by the Board of Directors within the limit approved at the general meetingof shareholders. As an advisory body to the Board of Directors, the Nomination & Remuneration Committee,
which majority is made up of outside directors, including the chairperson, deliberates on the resolutions of
the Board of Directors and reports their results to the Board of Directors in an effort to further enhancetransparency and objectivity.
At the extraordinary general meeting of shareholders held on May 24, 2019, it was resolved that the
maximum amount of directors’ remunerations (excluding directors who are Audit & Supervisory Committee
members) shall not exceed JPY 300 mn per year (however, this excludes salaries of directors who
concurrently serve as employees) and that remuneration for directors who are Audit & Supervisory
Committee members shall not exceed JPY 60 mn per year. At the 23rd Ordinary General Meeting of
Shareholders held on February 24, 2021, as remuneration for the execution of duties for five (5) years fromthe general meeting, the remuneration for granting restricted stocks were granted at an annual amount of up
to JPY 200 mn (however, this excludes salaries of directors who concurrently serve as director andemployee) within the current annual amount of monetary remuneration, etc. for directors of up to JPY 300
mn.
The chairperson of the Nomination & Remuneration Committee (outside director) determines the grantingof bonuses to officers and restricted stock remuneration upon interviews with each officer and reports theresults to the Nomination & Remuneration Committee.
Remuneration, etc. for Audit & Supervisory Committee members is deliberated by the Nomination &Remuneration Committee, and individual remuneration within the limits approved by the general meetingof shareholders is determined through discussion by the Audit & Supervisory Committee.

Whether the principle of one voting right per share is applied to all corporate meeting
resolutions
All of the Company’s authorized shares are common shares with one (1) voting right for every hundred(100) shares.

Disclosure of exercise of voting results
The results of the exercise of voting rights at the ordinary general meeting of shareholders held on
February 22, 2024 are as follows:
Proposal No.1: Election of one (1) director (excluding directors who are Audit and Supervisory
Committee members)
Proposal to elect Masashi Mizunaga as a director (excluding directors who are Audit andSupervisory Committee members).

Proposal:
Masashi Mizunaga

Number of votes
for proposal

Number of votes
against proposal

266,615

1,224

39

Voting results
and ratio ofvoting for
proposal

Number ofabstentions

0

99.47%

Proposal No.2: Election of one (1) director who is an Audit and Supervisory Committee member
Proposal to elect Izumi Saegusa as a director who is an Audit & Supervisory Committee member.

Proposal:Izumi Saegusa

Number of votes
for proposal

Number of votes
against proposal

266,631

1,210

Voting results andratio of voting for
proposal

Number ofabstentions

0

99.47%

Percentage of female executive officers (or equivalent positions)
The Company has introduced an executive officer system from the perspective of separating management
and execution. Executive officers execute the operations of each department in accordance with the
Executive Officer Regulations.
At present, the ratio of female executive officers is 0%. However, as mentioned above, the ratio of female
managers and employees in equivalent positions is currently about 29.8%, and we are promoting theappointment of female workers to important positions.

Reporting standards – company risk management system and transparency of reports withreference to external standards
In making our ESG disclosures, the Company refers to the framework described in the Engagement Guide(Home Builders industry) published by the Sustainability Accounting Standards Board (SASB).

Supervision of the following by the Board of Directors (Code of Conduct, Code of Ethics or any
other equivalent rules, ESG risks):
The Group has established a Charter of Corporate Behavior, which sets a Code of Conduct for officers andemployees of the Group to act in compliance with laws and regulations and the Articles of Incorporation.
The Board of Directors supervises the Code of Conduct. In addition, the Company monitors the ESG risks
which are listed below and deliberates and determines improvement measures as necessary.
1. Securing management personnel, and outflow of resources
Possibility that the operation of the Group would be greatly affected if management personnel who
lead business innovation or personnel who will spontaneously grow and play an active role could not
be secured, or if there is an outflow of such personnel from the Company.
2. Renovation workPossible effects on the Group’s operating results and financial condition if complaints or other issues
arise in the course of construction, or if a rise in materials prices or a distribution delay occurs due todomestic or overseas economic impact.
With the development of materials with a smaller environmental impact and a broader uptake of thesetechnologies, there is a possibility that prices will be passed on to each material, which will increase
renovation costs and become a factor that puts pressure on to the Company’s profitability.
Possibility that our business partners will be unable to secure human resources for renovation work
due to the impact of changes in the working population, etc.

40

3. Intensification of global warming
Possibility that intense heat will reduce profitability due to a reduced operational efficiency of
employees and the occurrence of occupational accidents.
Possibility of increase in utility costs from the increased use of heating at our offices, etc., leading tomore usage of electricity and greenhouse gas emissions which may further increase our cost fromcarbon taxing.
4. Legal regulations
Possibility that the business activities of the Group will be affected in the event that a part of thebusiness is restricted due to new establishment, revision or abolishment of relevant laws andregulations, or additional expenses are required to respond thereto.
In particular, the possibility of affecting the Group’s business activities due to administrative actions,fines, criminal penalties or loss of social credibility, etc. resulting from violations of environmental
laws, which are expected to be strengthened in the future.

5. Introduction of carbon tax
Possibility that the introduction of so-called carbon tax (tax based on greenhouse gas emissions) will
increase costs such as procurement costs of renovation materials, etc., company vehicle fuel prices,and electricity prices, thereby affecting the Group’s business activities.
6. Increase in abnormal weather
Possibility of a decrease in the number of real estate units purchased and an increase in running costsof the Company-owned properties due to a longer renovation construction period and longer sales
periods from delays in overall business activities caused by frequent occurrences of heavy rain,
typhoons, etc.
Indirectly, there is a possibility that the appraisal value of the Company-owned properties may
decrease due to the revision of laws and regulations related to disaster countermeasures or the
expansion of hazard map regulations.
7. Transition to a decarbonized society
As society as a whole makes its shift to a decarbonized society, the Company’s response may bedelayed, and the market competitiveness of its products (properties it offers, etc.) may decline.
8. Damage due to unforeseen accidents and natural disasters

If an unforeseen accident or natural disaster occurs in an area where the Company’s real estateholdings exists, there is a possibility that sudden repair costs due to loss, deterioration or damage ofthe real estate may occur and there may be a decline in future sales prices.

Slow investment sentiment in the real estate investment market may have an impact on the Group’sbusiness development.
9. Business continuity in the event of a disaster or other emergency
Possibilities of delays in resuming business activities due to a delay in restoring headquartersfunctions caused by insufficient Business Continuity Plan (BCP) measures.
*ESG risks include some risks that are not included in the “Risks in Conducting Business, etc.” described in
the Annual Securities Report.

41

Responses to the following matters in accordance with the Company’s rules,
regulations/charter/policies and any other equivalent rule:
The Group has established Risk Management Rules and has built a risk management system by organizing
a department and person in charge of risk management which will periodically report the status of risk
management to the Board of Directors and the Audit & Supervisory Committee. In the event of an unforeseen
situation, the Company will set up a task force headed by the CEO and establish a system to promptly respondto the situation upon receiving advice from experts.
In particular, the Group regards assurance of compliance as one of the most important matters in risk
management. In addition to the Risk Management Rules, the Group has established the Compliance Rules
and appointed a department and person in charge of compliance to comprehensively supervise complianceactivities across the Group as a whole.

Company-wide approach to non-compliance
The Group has established an internal whistleblowing system based on the Whistleblower Protection Act
as a means to prevent compliance violations. It will receive information on management risks from
employees who have knowledge of internal corporate problems as soon as they arise. It will then promptly
identify and correct such problems while thoroughly protecting the informant.
In addition, the Group established multiple internal whistleblowing channels, which lets employees toanonymously (if necessary) report internal matters to either corporate counsel, Audit & Supervisory
Committee members (outside directors) or compliance officers. When an internal whistleblowing is received,such report will be shared amongst the CEO, Audit & Supervisory Committee members (outside director)
and compliance officer who are engaged in handling internal whistleblowing. The compliance officer shallinvestigate the facts and consider and formulate measures to prevent recurrence in cooperation with legal
counsels, etc. as necessary, and make report to the Audit & Supervisory Committee and the Board of
Directors.
The operation performance of the internal whistleblowing system over the past three (3) years are as
follows:

FY21
Number of internal
whistleblowing

FY22
0

FY23
0

0

In addition to the internal whistleblowing system, the Compliance Rules require employees to anonymously(if necessary) report to the compliance officer when they become aware of violations of laws and regulations(including acts suspected of violating laws and regulations) committed by other employees. The complianceofficer shall cooperate with the internal audit division as necessary and promptly report to the Board of
Directors and the Audit & Supervisory Committee, and shall consider strict punishments and/or formulate
measures to prevent recurrence.
The status of the violation of the Compliance Rules and actions taken against such violation over the last
three (3) years throughout the Company are as follows:42

FiscalYear

Number ofinternal
whistleblowi
ng or reports
to thecomplianceofficer

Among thosereported in
the left,number ofcases foundto be inviolation oftheCompliance
Rules

Among thosefound to be in
violation oftheCompliance
Rules, thenumber ofcases forwhich actions
were imposed

Details of actions taken against the violation

FY21

1

1

1

Disciplinary action against temporary staff(equivalent to dismissal)

FY22

0

0

0

-

FY23

1

1

1

Disciplinary action against a full-time
employee (equivalent to demotion)

Supervision of health and safety by the Board of Directors
The Group has established a Health Committee to maintain and improve the health of its employees. The
Health Committee consists of four (4) members, including one (1) chairperson (the manager of Human
Resources and General Affairs Department), one (1) occupational physician, and two (2) representatives of
employees, with the CEO serving as the supervisor. The meeting is held every month. Specific items to be
discussed are as follows.
(1) Basic measures to prevent health impairment of its employee(2) Basic measures to maintain and promote employees’ physical health(3) Basic measures to maintain and promote employees’ mental health(4) Necessary measures to be taken based on the opinion of the doctor after the medical examination(5) Other matters related to hygiene
The content of deliberations by the Health Committee is shared by the CEO at the meeting of the Board of
Directors as necessary.

43