Table of Contents
3-3. Governance (G) Initiatives .................................................................................... 2
Communicating to all employees regarding the Company anti-corruption policy ........ 2
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 ................................................................ 2
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 .............................................. 3
Employee training on anti-corruption policy ................................................................ 3
Risk assessment of corruption in business .................................................................... 4
Disclosure of total amount of political contributions .................................................... 4
Number of actions taken against employees and dismissals resulting from violations of
the anti- corruption policy ........................................................................................ 4
Number of directors, number of independent directors, and number of female
directors .................................................................................................................... 5
Supervision and deliberation of the following items by the Board of Directors (misusein conflicts of interest and related party transactions) ............................................. 5
Regular evaluation of the effectiveness of the Board of Directors ................................ 5
Disclosure of number of annual meetings of the Board of Directors/director
committee meetings Disclosure of attendance rate of directors and committee
members ................................................................................................................... 7
Disclosure of directors’ remunerations ......................................................................... 7
Disclosure of fixed and variable remuneration amounts ............................................... 8
Disclosure of compensation paid to audit firms ............................................................ 8
Exercise of voting rights concerning directors’ remunerations ..................................... 9
Whether the principle of one voting right per share is applied to all corporate meeting
resolutions ................................................................................................................. 9
Disclosure of exercise of voting results ......................................................................... 9
Percentage of female executive officers (or equivalent positions) .............................. 10
Reporting standards – company risk management system and transparency of reports
with reference to external standards ....................................................................... 10
Supervision of the following by the Board of Directors (Code of Conduct, Code of
Ethics or any other equivalent rules, ESG risks):.................................................... 10
Responses to the following matters in accordance with the Company’s rules,
regulations/charter/policies and any other equivalent rule: ................................... 12
Company-wide approach to non-compliance.............................................................. 12Supervision of health and safety by the Board of Directors ........................................ 131

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.

2

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.

3

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.

4

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.

5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.

6

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.

7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).

8

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

9

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.

10

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.

11

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:12

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.

13