Integrated Report 2021

Inspiring the world with entrepreneurshipIntegrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

01

Conviction in “10X”

Conviction
The achievements of
the alliance with the Dentsu
Group pave the path to “10X”
Three years have passed since we began our capital andbusiness alliance with the Dentsu Group. Since then we havesteadily produced results, from dramatic improvements inearnings and productivity to continuously expanding our shareof Japan’s digital advertising market and more. Now we standpoised to embark on a new path toward “10X” - our nextstage of dramatic growth.

Integrated Report 2021

Message fromthe President

Conviction in“10X”

Value Creation
Process for “10X”

Strategy and
Performance

Company
Overview

Sustainability

Conviction in “10X”

1Achieving “10X”
expeditiously,
as a group ofcompanies witha startup mentality¥

From 2000 when we launched our internet advertisingbusiness through 2021, our CAGR on net sales inonline business has grown at a high rate of 34%.
With digital marketing primed to take on a newlevel of importance in future society, we are targeting
net sales of one trillion yen as our next stage of
growth. The keys to achieving that will be to grow thescale of our business and increase the value we canprovide. As our talented people brimming withentrepreneurial spirit generate one new business after
another through their advance insight on changes insociety, the pace of our growth will further accelerate.
See “Message from the President” from page 9
for our ideology behind “10X.”

trillion

Net Sales¥

97.6
FY2021billion

FY203X

02

Integrated Report 2021

Conviction in “10X”

Innovation
Providing services withthe most value,
to the most clients
Through the combined strengths of theSepteni Group and Dentsu Group, ourmarketing proposals integrate digital(online) and mass (offline) advertising.
We aim to be the largest digitalmarketing partner in Japan, capable ofproviding services with the most value tothe largest number of clients.

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

03Integrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Conviction in “10X”

Expansion into newareas of DX madepossible throughJapan’s best in
the business
By maximizing synergies in both size and function
by deepening our alliance, our core fields ofadvertising, content, solutions, and commerce
have been evolving.
Based on this evolved business structure, we
assist the DX of all types of cleints in any industry,business field and community as we support theirbusiness growth. We aim to be an indispensable
presence in digital society.

Advertising

SolutionsCore fields ofour group

Content

Commerce

See “Strategy and Performance” from page 26 formore about our expansion into new fields of DX.

Expansion into new DX fields

Company
Overview

04

Integrated Report 2021

Conviction in “10X”

Foundation
Our founding spirit, to empower
people and industry
We are in constant pursuit of our mission, “Inspiring theworld with entrepreneurship.” Our primary goal always has
been and always will be to seize on the changes in the times
and impact society positively through business.

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

05

Integrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Company
Overview

Sustainability

Conviction in “10X”

Our corporate
philosophy,
a driving force forsocial innovation
We empower people and industry throughbusiness by accepting each other’s individuality,
harnessing synergistic effects from their everyone’s
individual character and expertise, and enjoying
the process of continuously pursuing even greater
opportunities while doing so.
In addition to boosting shareholder value,
expanding the size of our business also creates
sizable multi-stakeholder value and involves
playing a significant role in society. We willtransform business and society to be moresustainable. That is our purpose as a company.

Citizens & consumers
Enriching people’s lives
through digital technologies

Investors &shareholders

Employees
Supporting work styles
that leverage diversityof individual character

Improving shareholder
value by swiftly
achieving “10X”

Inspiring the world
with entrepreneurship

Communities
See “Sustainability” from page 38 for more about
the value we provide to stakeholders.

Contributing to regional
revitalization by bridging the digital
divide, reducing disparities inopportunity, and creating jobs
through digital technologies

Clients
Creating social impact
linked to digital platforms

06

Integrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

Septeni Group Mission

MissionInspiring the world withentrepreneurship

We are a team of professionals
who repeatedly pursue andcreate digital marketing for thegrowth of clients’ businesses as
we lead the way to a futurethat is yet unseen.

What do we exist for?
What is our purpose in society?
These are expressed by our mission, to“Inspiring the world with entrepreneurship.”
The Septeni Group empowers people and industry
through business by accepting each other’s individuality,
harnessing synergistic effects from their everyone’s
individual character and expertise, and enjoying theMissionprocess of continuously pursuing even greater

Inspiring
the world withentrepreneurship

opportunities while doing so.
This is our distinctive brand of entrepreneurship whichbecomes transformed into the philosophies of ourgroup companies in their respective businesses, while at

Improve the value of manga
artists’ work and make it an
occupation that children
aspire toward.

Create the mostparenting-friendly era
in history.

the same time developing as the driving force behind
the Septeni Group as a whole.

07

Conviction in“10X”

Integrated Report 2021

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

08

CONTENTS

03 Sustainability

38

Conviction

01

Discussion: Update to “Sustainability”

39

Innovation

03

Sustainability Committee Organizational Chart

43

Foundation

05

Priority Challenges and Identification Process

44

Septeni Group Mission

07

Priority Challenges in the Septeni Group45

Priority Challenge 1: Industry Development throughUtilization of AI

Message from the President
09

Priority Challenge 2: Development of High-Quality
Human Resources

46

Priority Challenge 3: Diversity & Inclusion

49

01 Value Creation Process for “10X”

15

Priority Challenge 4: Support the Sound Development of
the Digital Advertising Industry

51

Value Creation Process to Achieve “10X”

16

Priority Challenge 5: Support for Culture, Sports andthe Entertainment Industry

52

Message from the President

Inputs17- History of Linking Changes in Industry and Society to GrowthCore Values X Inputs- The Competitive Advantage of the Septeni Group19

Outputs- The Path to Achieving “10X”

21

Outputs X OutcomesThree-Person Discussion: Social Value Created by
Our Alliance with the Dentsu Group

23

Environment

53

Corporate Governance

54

Messages from Outside Directors

58

Structuring a Management Team Using FFS Theory

59

Company Overview

02 Strategy & Performance

26

Medium-term Business Policies- First Steps Toward Swiftly Achieving “10X”

27

Digital Marketing Business28

Media Platform Business

32

Expanding into New Business Segments

36

Consolidated Financial & Non-Financial Highlights (IFRS)

61

Company Overview

63

Stock Status

64

Editorial Policy
The Septeni Group aims to help realize asustainable society by working to resolve
social issues through its businesses. We
publish the Integrated Report to give our
stakeholders an overall understanding of theGroup’s progress and value creation throughits business activities. This report presents
management policies and business strategies from a medium tolong-term perspective, as well as financial and non-financial
information, using as reference the International Integrated Reporting
Framework issued by the International Integrated Reporting Council
and the Guidance for Integrated Corporate Disclosure andCompany–Investor Dialogue for Collaborative Value Creationcompiled by the Ministry of Economy, Trade and Industry of Japan. For
more detailed IR and sustainability information, please visit our website.

Forward-Looking Statements
Statements other than historical facts contained in this report are
forward-looking statements that have been prepared on the basis ofcertain assumptions and the judgments of the Company’s management
derived from currently available information. Therefore, informationsuch as actual business results announced in the future may differ
depending on various factors, and the Company is not responsible forany damages resulting from the use of the information in this report.
Importance to stakeholders HighConviction in “10X”

Covered inthis report

Septeni Group
Websitehttps://www.septeni-holdings.co.jp/en/

Covered on
our website
Importance to management High

Investor Relation
https://www.septeni-holdings.co.jp/en/ir/

Sustainability Information
https://www.septeni-holdings.co.jp/en/csr/

Storie(s) (Japanese only)
https://note.com/septeni_groupIntegrated Report 2021

Message from the President

Targeting “10X”
Accelerating Our Rise to
Japan’s Largest DigitalMarketing Partner
Koki Sato
Representative Director and President,Group President and Chief Executive Officer
Septeni Holdings Co., Ltd.

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

09Integrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

10

Message from the President

The COVID-19 pandemic has fueled
accelerating demand for
digital-based marketing

Deepening our alliance with theDentsu Group
Offering broader, more in-depth,
top-caliber solutions

Looking back on these past two years, thecompanies in the fiscal year ended September
2021. Sales per client in our own digital marketingbusiness had increased to 2.5 times what it waswhen the alliance began.
We have also been able to achieve steady organic

COVID-19 pandemic has catalyzed significant

While COVID-19 has accelerated the pace, at some

growth over these three years by enhancing ourchanges in people’s living environments while

point these changes in the market still would havebrand power and establishing ourselves as an evenaccelerating the shift to digital lifestyles, consumer

occurred. In 2018 we entered into a capital andmore trustworthy, credible presence.

behavior, and work styles. DX has generated large

business alliance with the Dentsu Group. Having

waves in companies as well, as digital-based

begun this alliance, we made management

more in-depth alliance with the Dentsu Group. Thisinitiatives in structuring business models are now

decisions based on our aim to generate our own

would strengthen and expand our highly effective

happening everywhere. In marketing activities there

original value in the field of digital marketing andmarketing proposals to make the customer

is also an increasing need to transition the customer

establish an advantageous position before theexperience better on both the horizontal axis ofexperience to digital, giving rise to a new type ofmarket grew and competition intensified.

expanding the range of services offered, and themarketing demand that cannot be captured withconventional business structures.
This change is not temporary. The presence ofWhen the alliance began, we advocated aThen in October 2021, we announced an evenvertical axis of being able to leverage data in evencollaborative philosophy of, “Both groups aim to

greater depth for analysis and insight. In otherbe the largest digital marketing partner to provide

words, this meant being able to offer even broader,

digital platforms in society will continue to grow, as will

our clients the best solutions in an environment

more in-depth, and optimal solutions.

the importance of digital marketing that uses them.

where people with various talents assemble with

When making this decision, we discussed

the joy of working,” together with the Dentsu

corporate governance thoroughly in-house andGroup. We then bolstered our ability to deliver

frequently consulted the Dentsu Group on the topic.

solutions to the diversifying problems our clients

We established common ground with them on theface primarily through online and offline integrated

perspective of protecting minority shareholders asmarketing proposals that combine our strength inwell as the awareness that the human capital anddigital marketing with the strength of the Dentsu

spirit of entrepreneurship at the core of our businessGroup in mass advertising mediums such as

value must not be diminished. As such, we will

television. Through these efforts, our collaborative

continue to practice management based onclient base with the Dentsu Group grew to over 100

corporate governance with a strong emphasis on

Integrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
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Sustainability

Company
Overview

11

Message from the President

independence and autonomy, including policies for

Framework for expanding the scope of the Group’s business by deepening alliances

director nomination and composition as well as

Digital marketing market

maintaining our listed status.
In the medium to long term, we believe this will

Existing partnerships

help us generate corporate and shareholder value

New collaboration inthis alliancein excess of equity diluted via third party

Advertising market

Solution market

allocations of shares. We anticipate that our EPS
will roughly double over the next few years throughboth organic growth and synergies from ourFrontdeeper alliance.

Conversion toan equity-method
affiliate

Becomea consolidated
subsidiary

Based on the collaborative philosophy at theoutset of the alliance in 2018, we have been

Delivery and operation

steadily producing results ever since. This has
proven to us that the strategy was a sound one.
This deeper alliance that we embark upon now ishighly meaningful, as it truly represents anaccelerated path toward turning our collaborative

Operational foundation /Product development

philosophy into reality through expanded
operations and enhanced business capabilities.

Media, platform

SEPTENI GroupThrough the consolidationof Dentsu Direct Inc.,
acquire capabilities in themass domain and enhance
our presence in the ﬁeld of
Direct Marketing

Deepen and acceleratecollaboration in integrated
marketing proposals by
utilizing the Dentsu Group’s
customer base

By making Dentsu Digital
Inc. an equity-method
afﬁliate, enhance capabilities
in the development andsolutions domain.

Integrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

12

Message from the President

Image of Growth after Deepening the Alliancesa
Organic

Benefits of previous alliances

Effects of the alliance• Acquisition of new collaborations and large-scaleclients through expansion of commercial distribution• Strengthen the direct marketing domain throughacquisitions and development and solutions domains
through investment.
• Synergies in multiple domains by promoting the
integration of business foundations

Provide greater multi-stakeholder
value and be the engine that drivessocial transformation
In addition to boosting shareholder value,
expanding the size of our business also creates
sizable multi-stakeholder value and involves
playing a significant role in society. That is our
purpose as a company.
We provide digital marketing services to large
companies in every industry, primarily for the• Advertising management support for digitalmarketing projects handled by the Dentsu Group• Online/offline integrated marketing proposals byleveraging the client bases of both companies’
groups, etc.

products and services of major platform operators
who have large social impact. With the intention ofserving an essential role in the advancement ofdigital society for years and decades to come, we
proudly refer to what we do as “Essential Work.”
In the Septeni Group, we bring together people
with entrepreneurial spirit, based on our mission of“Inspiring the world with entrepreneurship,” andour culture is fertile soil for developing digital• Enhancing our presence in growing markets throughalliancesmarketing professionals. To fill our ranks with more

• Strengthen organizational foundation throughcollaboration (human resources and productdevelopment)“Essential Work” for digital society and increase• Increase in per capita productivity due to increase inunit price per client
Before the start of
the alliance

Present

Futureof such talent, I want to refer to what we do as
job satisfaction, while at the same time bringing
aboard more and more people who seekinteresting work that has a large impact on society.
With professional personnel who provide evenhigher quality services and create new business, weIntegrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

13

Message from the President

will advance DX in various industries, businesssteps one and two. Imagine it to be like addingof our company will be. As a group of companies

fields, and communities, and create new change.

new branches and leaves one after another to anwith a startup mentality, we will go on changing

We will bolster our core value of the humanalready thick tree trunk and yielding huge volumes

and evolving from here. The keyword is “10X.”

of fruit.

Rather than stopping with quantitative growth

assets and turn them into an engine for societal
growth. This is truly the role that the company
plays, and we at Septeni have strong determinationand conviction to become a major presence withsignificant social impact.

As indicated by the discontinuous
curved growth line, we aim to swiftly
achieve the top market share with
“10X” the scale
The discontinuous curved growth line is a
representation of our envisioned future growth.
Until now, we have had a two-step structurecomposed of new business added to the growth of
our existing business, but the newly deeper alliancehas added a third step. The first of these steps
represents greater organic competitive strength ofour digital marketing business, while the second
step is an addition resulting from the newly
expanded business alliance. The third step isgenerating an even broader array of innovations
and bolstering the expansion of our media
platform business and business in new domains,based on business infrastructure expanded throughWe see this point in time as the starting line,from which we cannot at all see what the final form

represented by the size of our sales numbers, wewill also raise the multi-stakeholder value weIntegrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

14

Message from the President

provide such as the quality of services for our

Discontinuous curved growth line: The path to 10X

10X

client, job satisfaction in our workplaces, and thevalue of our human capital to ten times current
levels. Through this process, we will aim to achieve
the top share of Japan’s internet advertisingmarket. This is the type of business value that wewill strive to swiftly achieve.
The Septeni Group has set off on a new journey,

With entrepreneurship as
its core value, the Company
aims to achieve
discontinuous growth and“10X” by exploring anddeepening businesses.

and we hope you share our excitement for the future.

Koki Sato

Expansion into
New BusinessDomains

Representative Director and President,
Septeni Holdings Co., Ltd.
Group President and Chief Executive Officer
Addition by
deepeningalliances

Net sales

97.6 billion¥

FY2021

Strengtheningorganic
competitiveness

FY203XIntegrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Company
Overview

Sustainability

15

01
Value Creation
Process for “10X”
Value Creation Process to Achieve “10X”

P16

Inputs- History of Linking Changes in Industry
and Society to Growth

P17Core Values X Inputs- The Competitive Advantage of the Septeni GroupP19

Outputs- The Path to Achieving “10X”

P21

Outputs X OutcomesThree-Person Discussion: Social Value Created by
Our Alliance with the Dentsu Group

P23

Integrated Report 2021

Conviction in“10X”

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Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

16

Value Creation Process to Achieve “10X”

The Septeni Group’s core values
are human resources with a good
sense of ownership and a strong
entrepreneurial spirit and extensive
human resource database andtechnologies. By maximizing humancapital, we will demonstrate highperformance and empowerstakeholders and industries
through business.
We are striving to achieve our
mission in anticipation of “10X.”
InputsCore values × Inputs

Outputs

pp19-20

pp17-18

Core values

pp17-18

Outputs × Outcomes

pp23-25• Improved
employee job
satisfaction• Return ofprofits toshareholders

Human resources
with a good senseof ownershipand a strong
entrepreneurial spirit

Responding tomajor changes inindustry and society

pp21-22• Digital Marketing
Business

Empowering
people andindustry throughour businesses

Accelerating
growth torealize “10X”• Media Platform
Business• Expansion into New
Business Segments

Extensive humanresource database
and technologies

Improvement of core values(further acquisition of human resources/improvement of data accuracy)• Improved
quality of life
for users• Mutualdevelopmentwith partnercompanies• Growth ofclients’businesses

MISSION
Inspiring
the world withentrepreneurshipIntegrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

17

InputsHistory of linking changes in industry and society to growth

Since its establishment, the Septeni Group has continued to grow by transforming its mainstay businesses from the recruitment consulting
business to the Direct Marketing Business to the Internet Advertising Business. In 2020, the Group celebrated its 30th anniversary.
In 2021, our group made a new start. Aiming to be a company that all stakeholders rely on, we will view social changes as new growth
opportunities and provide services that exceed client expectations, looking ahead to the times.

Founded in1990

Establishment of SUB & LIMINAL CO., LTD.
In 1990, our founder Mamoru Nanamura established SUB &LIMINAL CO., LTD., the forerunner of SEPTENI HOLDINGS CO.,LTD., to embark on the recruitment consulting business. In 1993,
we launched the Direct Marketing Business (an agency service
for sending direct mail). Business grew steadily, laying thefoundation of the Septeni Group.
The Septeni Group is not affiliated with any conglomerate.
We commenced business with hardly any capital, humanresources or operations. Our staff’s wisdom and ideas alone
were our initial assets. We constantly bear this inaugural spirit inmind as we continue to grow.

Mamoru Nanamura,Founder of
the Company

Creed
In Kansai dialect, this means ”Think outside the box.”

2000-20112012-

Achieved Strong Growth throughthe Internet Advertising BusinessToward Further Growth through Organic
Growth and Alliances with the Dentsu GroupIn 2000, current Representative Director Koki Sato launched theInternet Advertising Business. The Septeni Group grew rapidly as
it continued to steadily scale up its business operations for a
speedy response to the expansion of the Internet advertisingmarket and constantly changing advertising needs. In addition to
opening regional bases, we also expanded our business domains
through M&A and other methods.

We have continued to grow while adapting to changes in industry
and society, including focusing on smartphone advertising and social
media advertising, and launching our manga content business. In
addition, we aim to achieve further growth through the Capital andBusiness Alliance with the Dentsu Group, Inc. and its deepening.
Going forward, we will focus on online-and-offline integrated
proposals, for which needs are growing, and strengthening
capabilities in the data domain, which will lead to earnings growth.

2000 Apr. Started the Internet Advertising Business2001 Aug. Listed on JASDAQ
2006 Apr. Became a holding company under the trade name
SEPTENI HOLDINGS CO., LTD.
The Internet Advertising Business was taken over by
SEPTENI CO., LTD. through an incorporation-typecompany split, and the Direct Marketing Business was
taken over by SEPTENI DIRECTMARKETING CO.,LTD. through an absorption-type company split

2022

2012 Mar. Began conducting the Internet Advertising Businessoutside Japan
2013 Feb. Established COMICSMART, Inc. and started theManga Content Business2014 Oct. Sold all shares of SEPTENI DIRECTMARKETING
CO., LTD.
2018 Oct. SEPTENI HOLDINGS CO., LTD. entered a capitaland business alliance with Dentsu Inc. (currently
Dentsu Group Inc.)
2021 Oct. Announced deepening of Capital and Business
Alliance with the Dentsu GroupConviction in“10X”

Integrated Report 2021

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

18

InputsHistory of linking changes in industry and society to growth

In 2021, digital advertising expenditures amounted to ¥2,705.2 billion, exceeding mass advertising expenditures,
including television advertising, for the first time.
Digital advertising is establishing its position as the largest advertising media in the Japanese advertising market.
Since the launch of the digital advertising business in 2000, our group has achieved sustainable growth andestablished its current core value by flexibly responding to the shift from mass advertising to digital advertisingand to changes in the format and objectives of Internet advertising.

“Core values”
cultivated by responding
to changes
We have created values in
response to changes in the market
by combining data with humanresources with shared values.

*Reference: Dentsu Inc. Marketing Report: 2021 Advertising Expenditures in Japan, published February 24, 2022

Average annual growth rates ofnet sales and operating profit
since the fiscal year ended
September 2000
Net sales: approx.

15%
16%

Operating profit: approx.

*Combined net sales and operating
profit of Original Businesses andInternet Businesses.

FY2000Net sales¥

4.9 billion

FY2000Operating profit¥

0.18 billion

approx.
20 times

approx.
22 times

FY2021
Net sales¥

97.6 billion

Human resources
with a good senseof ownershipand a strong
entrepreneurial spirit

FY2000Operating profit¥

3.8 billion

Note: Figures presented are based on J-GAAP for
FY2000 and IFRS for FY2021.

Core values

Net sales and Operating profit
Net sales

Extensive humanresource database
and technologies

Operating profit

1990

1995

2000

Original Businesses (Direct marketing, etc.)

2005

2010

2020 2021

2015

Internet Businesses (Digital Marketing Business, Media Platform Business)

1994-1998

1999-2003

2004-2007

2008-2013

2014-

Internet usage becomeswidespread among thegeneral public
Era of banner ads

The Internet becomes available
anytime and anywhere
Diversification of advertising methods(affiliate marketing, keyword search)

Dawn of social media
Attempts at cross-advertisingwith existing media

Evolution of ad technology
Conceptual shift from “buying ad
space” to “buying a number ofpeople to reach with information”

Double-digit growth in Internet advertising expenditurescontinues, with mobile advertising driving market expansion
The COVID-19 pandemic accelerates the digital shift and DX

Integrated Report 2021

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Value Creation
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Overview

19Core Values × Inputs

The Competitive Advantage of the Septeni Group
Promptly focusing on the growth markets and social
issues of the near future, making big waves andtaking it upon ourselves to find solutions - This isdriven by our core values, of human resources witha good sense of ownership and a strong
entrepreneurial spirit, and our extensive humanresource database and technologies.

Human resources
with a good senseof ownershipand a strong
entrepreneurial spiritCore Values

Extensive humanresource database
and technologies

Instilling our philosophy and utilizing ourdatabase to bolster our core values
To create an environment for our human resources with agood sense of ownership and a strong entrepreneurial
spirit to leverage their capabilities to the fullest, we
actively invest in instilling our philosophy and utilizing
our database.
Instilling the philosophy to develop humanresources with a good sense of ownership anda strong entrepreneurial spirit
We hire employees according to our own proprietary
success prediction model, which predicts how well they
will perform after joining the company. We also
implement measures to instill our corporate philosophy
such as assisting employees in formulating their own
personal philosophies. We have a distinctive
organizational culture of flexible adaptation to change
and mechanisms for generating new business, which our
employees acquire through challenging work. Based on
this culture, we are building our own original model forhuman resources who continue to grow as professionals
to develop and nurture new business and services, withour corporate philosophy as the foundation.
Utilizing our human resources databaseaccumulated over more than twenty years
For our human resources with a good sense of ownershipand a strong entrepreneurial spirit to be able to further
harness their abilities, the Septeni Group is engaged inresearch on human resources (HR) development basedon the vast amount of our own HR data accumulated
over more than 20 years. We seek to build an HR value

chain for designing services that are consistent every
step of the way from hiring to onboarding to learningand development.
For the hiring stage, we use AI to calculate candidates’chances of success after joining the company, which weuse as reference material for HR evaluations. Throughefforts such as providing “career feedback” for hired
candidates to envision their own career paths after
joining the company, we have also reduced the ratio ofcandidates who decline our job offers. In onboarding, weare building a system that enables employee retention
and helps them quickly become contributors, including
optimal personnel placement utilizing compatibility
models derived from our own original “HR development
equation.” For new employees, we also offer “adaptationplans” based on their own strengths and stumbling
points and devote significant effort in HR development tohelping them quickly become contributors.
Based on these technologies and experiences
accumulated in our group over the years, we establisheddigital HR cloud services and consulting company
Human Capital Lab, Inc. in 2021. Human Capital Lab(“HCL”) helps to solve companies’ problems in HR
development through its “HaKaSe Onboard” DX service
that supports employee onboarding.
For details, see Key Sustainability Topic 1: Industry Development
through Utilization of AI/ Key Sustainability Topic 2: Developmentof High-Quality Human Resources on pages 46-47.

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20

Core Values × Inputs

The Competitive Advantage of the Septeni Group

Number of employees

1,511

HR Technology Awards recipient

6

The Source of Our Core Values

Company Culture Conducive
to Innovationconsecutive years(as of the end of FY2021)

Employees with strong sense ofownership volunteering forcross-departmental committees

Employee job satisfaction

138

10

in total

2022 edition of Best Workplaces in Japan rankings

Large company category:th place

Major initiatives
Adapting to Change:

Embracing Diverse Work Styles:

Smooth Transition to Remote WorkSide Job System

Since late February 2020, we have been implementing
various measures in response to the COVID-19 pandemic
such as encouraging all employees to work from homeand establishing the corresponding infrastructure. As aresult, we were able to keep our physical workplaceattendance rate to only 14% on average from March
2020 to April 2021. We will continue building systems
that adapt to changes in our environment going forward.

We have implemented a side job system with the ideathat individuals can experience additional success intheir main line of work through skills and experience
gained away from the job. We will continue promoting
diverse work styles in accordance with changes in society
and personnel.

The Septeni Group has environments and systems
conducive to taking on various challenges andcreating new services. This includes Business
Leadership Program (BLP), a learning anddevelopment program specialized in the field of
management, Gen-Ten (new business plan contest),
and written submission contests for proposals about
the future of our company.
Based on a culture of voluntarily stepping forward,
a culture that encourages challenge, each and every
one of our entrepreneurial personnel enjoy theprocess of seeking out even greater opportunity as
they harness their abilities in our organizations.
New business plan contest Gen-Ten
Cumulative entries

227

teams (over 10 years)

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Outputs

The Path to Achieving “10X”
The COVID-19 pandemic has triggered a major waveof DX in all industries, further increasing demand for
digital marketing in the advertising industry as well.
Under these circumstances, the Company Group
deepened its Capital and Business Alliance with theDentsu Group with the aim of becoming No.1 in thedomestic digital marketing domain.

Philosophy Targeted in the Capital andBusiness Alliance
Both groups aim to be the largest digital marketing partner toprovide our clients with the best solutions in an environment where
people with various talents assemble with the joy of working.
Advertising

Strengthen core domains througha deeper alliance with Dentsu
Barriers between online and offline are gradually being
eliminated in the marketing challenges faced by ourclients, and marketing companies are being asked toprovide solutions that maximize advertising effectivenesswith a more integrated and comprehensive approachand utilizing various types of data.
In light of this situation, since the Capital and Business
Alliance in 2018, our Group and the Dentsu Group havebrought together each other's strengths and resources,enhanced the value of the services both provide, andpromoted collaboration.

Accelerate collaboration on digitalmarketing projects through expansion of
the commercial distribution from theDentsu Group.

DigitalMarketing

Data
Solutions

Strengthen the development structure andpromote product development of bothgroups by accelerating collaboration with
Dentsu Digital Inc.

OthersConsideration of integrated programs forrecruitment and development of digital
human resources, mutual use of tools, etc.

• Development of new collaborative projects through integrated
marketing proposals for online and offline advertising utilizing
both companies’ client bases

In order to further strengthen and expand suchbusiness collaboration, we deepened the alliance with
the Dentsu Group in 2021.

Core area of
our group

Contents

Commerce

Expand collaboration with the Dentsu
Group in our advertising management andcreative areas.

• Offering knowledge and technology of the digital marketingbusiness from our group to the Dentsu Group• Advertising management support for digital marketing projects
handled by the Dentsu GroupStrengthen the Direct Marketing domain
and joint developing solutions utilizing thestrengths of both Dentsu Direct Inc. andour group.

Solutions

Expansion to
new DX domain

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Outputs

The Path to Achieving “10X”

Next stage of growth (expansion into new business domains)

Long-Term Growth Strategy to
Achieve “10X”• Developing and deploying business development personnel, and transitioning to ecosystems• Changing to environments conducive to launching new business in
new territories geared toward achieving discontinuous growth

CAGR on net sales in the 21 years since launching ourinternet advertising business in the Septeni Group has
been 34%*. Going forward, the scale of our business will
be important to maintaining CAGR of at least 30%. We
will expand our domain by refining our existing
businesses, bolstering our competitive capabilities, andgenerating one new business after another.
Our deeper alliance with the Dentsu Group willfurther accelerate these efforts. The Septeni Group hasclient channels, advertising operation capabilities in thedigital advertising market, and development
capabilities in the field of data solutions. The Dentsu
Group has approximately 6,000 client channels in Japanand provides planning and integrated solutions
combining mass media with digital media. The
synergies generated between these two groups withdifferent characteristics will be leveraged in terms ofboth business areas and functionality.

10x

Strengthen our existing business infrastructure(addition through deeper alliance + strengthening of organic competitive capability)• Further refine existing advertising management services• Improve the level of services to clients by strengthening our organizational infrastructure• Raise gross profit productivity per staff member by increasing unit prices
for projects and improving solutions offered*Excluding original businesses

Net sales¥

97.6 billion
FY2021

Strengthening organizational infrastructure• Be more competitive in the human resources market by improving job satisfaction• Grow the organization through increased hirings and M&A• Utilize data-driven human resources systems that employ our original HR technology platforms

FY203XIntegrated Report 2021

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Outputs × OutcomesThree-Person
Discussion

Social Value Created by Our Alliancewith the Dentsu Group

What kind of changes will our deeper capital and business alliance with the Dentsu Group bring about?
Norihisa Ashida and Yuko Wakatsuki of Septeni Japan, Inc. and Tetsuji Hirose, Alliance Office and Growth
Officer of Dentsu Japan Network discussed the effects of the alliance thus far, efforts to improve value
offered, human resources, and the social value brought about by the alliance.

Norihisa Ashida

Tetsuji Hirose

Yuko Wakatsuki

Control Officer, Alliance Office
Septeni Japan, Inc.

Growth Officer
Dentsu Japan Network

Chief Producer,
Strategy Planning Department
Marketing Strategy Office
Alliance Office, Septeni Japan, Inc.

Three Years of Tangible Effects
Onward to the Next Step
with the Deeper Alliance
Ashida: Since the capital and business alliance with theDentsu Group began in 2018, we have achieved agrowth trajectory that I had never experienced before.
Now, this deeper alliance feels like recognition also fromthe Dentsu Group for the activities that have taken placeover the past three years.
As clients’ marketing needs have gotten moresophisticated and diversified, companies need to beable to handle comprehensive marketing that goesbeyond the boundaries of mass and digital advertising.
Through this deeper alliance, I think we have been able
to establish a positioning as an indispensable business
partner for our clients.
Wakatsuki: There was some grasping with uncertainty insome areas over these past three years, but I have felt
enough effects from it to know that it has undeniably led
to greater value provided to our clients. It was excellent
timing to take the next step in the evolution by
deepening the alliance.
Hirose: In the three years since the alliance began, I
have gotten a feel for the knowledge and skills,
expertise, and the depth of the digital human resourcesof the Septeni Group as a digital agency. Client response
to our collaborative projects has also been very positive.

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Outputs × OutcomesThree-Person Discussion Social Value Created by Our Alliance with the Dentsu Group

Online-Offline Integrated Marketing
Further Enhances Value Provided
to Clients
Wakatsuki: Contact time with television and digital havereversed in recent years, and contact time with digital
media is increasing among younger people in particular.
Communicating with consumers will therefore also
require changes in marketing methods on the company
side. The issue in the industry is that agencies for digitaland mass advertising have existed separately until now
and that they are fragmented.
As changes like these take place, maximizing theresults for clients requires integrated online-offline
marketing that sees marketing as neutral without any
segmentation between online and offline. The alliancewith the Dentsu Group makes it possible to merge ourhighly professional capabilities in order to construct
integrated marketing that combines online with offline.
That helps to significantly expand the range of planningand increase value provided to clients.
In online-offline integrated marketing cases that we
actually proposed, we have been able to build integrated
marketing combining digital and mass advertising byteaming up with the diverse personnel of the Dentsu
Group. I am really feeling the effects of the alliance.
Hirose: The strengths of the Septeni Group are theirplanning capability in digital media, operation capability,
expertise, and skills, and their diverse roster of humanresources in digital.
I think that having this new force in digital added to
the Dentsu Group is extremely beneficial for our efforts
in integrated marketing.
Wakatsuki: The Dentsu Group does business withcompanies in a broad variety of industries, which gives

their group a solid client base. I want to leverage ourcapabilities as a digital agency to expand the domain of
online-offline integrated marketing incorporating offline
media to these clients.

Leveraging Each Other’s Strengths
to Harness Synergies
With a Common Client-First Attitude
Wakatsuki: To further solidify our alliance with theDentsu Group, it is important that we maximize our
synergies by combining our expert personnel. Ourgroup has large numbers of experts in digital on staff,
but I think we may have also been too obsessed withdigital as a method. For our efforts in integrated
marketing going forward, we need to make digital theIntegrated Report 2021

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Outputs × OutcomesThree-Person Discussion Social Value Created by Our Alliance with the Dentsu Group

entry point while bringing aboard more personnel who
are capable of coming up with a broad range ofsolutions and new ideas.
The Dentsu Group has a diverse range of personnel in
its ranks with expertise that our group lacks, from mass
advertising planning capabilities to production
capabilities that can identify clients’ needs, strategists
who think up business strategies, and powerful creative
thinking, all built up through their years of experience. I
think that joining project teams with personnel such asthese is also playing a part in advancing humanresources development at Septeni Group.
Hirose: People in the Septeni Group have practicalexperience in digital marketing starting early in theircareers. They face the clients as the company’s front line
and take responsibility as they provide a variety of solutions.
I think this is an enormous asset for an organization.

We will be able to accomplish many great things if we
can share our expertise, skills, and experience with eachother while raising each other’s level, and get a goodunderstanding of each other’s personnel, resources, andclient bases.
Ashida: Our personnel always have a client-firstmentality. I also feel that both companies share thecustomer-first approach. Since both companies
emphasize this mentality as part of their culture, I thinkthat makes it easier to harness synergies.

Continuing to Be a Good Partner
for Clients Leads to Sustainability
Ashida: Our clients’ business growth has a ripple effecton society, so I think if we continue being a good partner

to our clients, it will lead to sustainability. The digitalindustry is continuously churning out new services andsolutions. It is volatile and the changes are happening at
breakneck speed. To stay ahead of these changes, wewill need to increase the value of our Septeni Group
personnel even more, while leveraging the expertise of
the Dentsu Group to continuously generate synergies
with each other.
Hirose: The vision of the Dentsu Group is to be an
Integrated Growth Partner (IGP). We aim to be a partnerthat supports companies’ growth by providing
integrated services. To be a presence that our clients cancall a partner, I think we inevitably need to become No.1
in the digital marketing domain.
Wakatsuki: I agree with Mr. Hirose. Both of ourcompanies can achieve sustainable growth by being apartner that goes beyond the conventional ways ofmarketing and position as advertising agency standpoint
to be a closer presence for our clients and think together
with them about their growth.
As expressed by our mission to “Inspiring the world
with entrepreneurship,” I want us to inspire the world.
This starts with each and every one of our employees
engaging earnestly with those around them, from theclients in front of them to our colleagues in the Dentsu
Group, workplace colleagues, and others, to make ourclients’ businesses grow.

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26

02Strategy and
Performance
Medium-Term Business Policies- First Steps Toward Swiftly Achieving “10X”

P27

Digital Marketing Business

P28

Media Platform Business

P32

Expanding into New Business Segments

P36

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Medium-Term Business Policies- First Steps Toward Swiftly Achieving “10X”
We utilize a rolling method to review our Medium-Term Business Policies every year so that management can adapt quickly to operating environment changes.
This update, which was implemented in conjunction with the announcement of financial results in February 2022, includes deeper alliances with the Dentsu Group to our policies to date,
and aims towards the growth of CAGR 30% in the Internet Businesses in both revenue and Non-GAAP operating profit over the next three years.

The three-year plan announced this time is calculatedwith the expectation of synergies and other factors
resulting from the deepening of the alliance with theDentsu Group from January 2022 onward, as well as ourorganic growth. We have also incorporated aggressive
human resource investment into our plans to grow ourbusiness and strengthen our organization. In addition, we
will consider business investment opportunities while
taking into account the business environment. We will
also consider updating our dividend policy and flexible
shareholder return measures in accordance with thegrowth phase.

Expand domains in both existing andnew directions
In the Digital Marketing Business, we will place deeper
alliances with the Dentsu Group at the core of our
growth strategy, and aim to increase market share byacquiring new clients and increasing unit prices while
maintaining profitability through growth in solution
revenues and other means. In addition, we will pursue
organizational growth through aggressive investment in
human capital at the same time. In the Media Platform
Business, while maintaining appropriate financial
discipline, we will strengthen our intellectual property (IP)development capabilities in the Manga Content BusinessMedium-Term Business Policies by Segment

and enhance the value of our IP, thereby growing
earnings and developing it into the next core business.

Expands the existing domain

Consolidated (before update)• Strengthening developmentof e-commerce ad domain

Revenue
Non-GAAP operating profit
Operating margin (relative to revenue)(unit: ¥bn)
50

(%)
25

40
30
20

0

CAGR

22.0

20.0

10

17.9

16.4

14.3

9.5%
3.6

FY2021(Forecast)

FY2022(Plan)

20
15

24.0

10

CAGR

2.85

4.3

22.8%

FY2023(Plan)

50

Consolidated (after update)

Revenue
Non-GAAP operating profit
Operating margin (relative to revenue)(unit: ¥bn)
50
40
30
20
10
0

17.7

17.8

45.0
36.5
17.8

30.0

21.4
3.8

5.3

6.5

FY2021(Result)

FY2022(Forecast)

FY2023(Plan)

DigitalMarketingBusiness

(%)
25

18.9

30.8%

Media
PlatformBusiness108.5

FY2024(Plan)• Enhancing the Group systemof data & solutions domain• Deepening capital andbusiness alliance with theDentsu Group• Focusing on revenue fromcharge on users• Strengthening businessdevelopment of D2C

20
15

CAGR

28.1%
CAGR

Expands into new domains

Forecast the impact of deepening
the alliance and update the plan

50

New Business
Segment• Absorbing demand for
DX focusing on selectedindustries• Commercialization of HR
technology domain

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Digital Marketing BusinessBusiness Overview
We engage in the overall support of digitaltransformation (DX) of companies, focusing on digitalmarketing such as the sale and operation of digitaladvertisements, offering solutions through the utilizationof data and AI, and supporting marketing activities
through the integration of online and offline
advertisements in collaboration with the Dentsu Group.

Strengths

Issues• Knowledge and expertise in the digital advertising domain• Knowledge and expertise in the solutions domain• Integrated online/offline marketing• Connectivity between the digital advertising andsolutions domains• Expanding capabilities through the alliance with
the Dentsu Group

Opportunities• Sophistication and complexity of client needs inthe solutions business• Securing digital marketing personnel• Society-wide and Industry-wide progress in DX• Growth of the digital advertising market• Demand expansion in the solutions domain

Business Model
Digital Marketing Business

Internet media

Ads• Planning and design of integrated marketing

DX support• Planning and design of promotions• Ad operation

Data & Solutions
Clients

Provide solutions

Advertising distribution,
display

Advertising purchases• EC/CRM consulting• EC & Mall solutions• Offering solutions through analysis,
integration and utilization of data
• Affiliate networks• Offering soliton tools utilizing AI etc.

Campaign implementation, operation andeffectiveness measurement

Information dispatch

Users

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Digital Marketing Businessproductivity in the Digital Marketing Business as a whole.
In the data & solutions domain, we strengthened ourcompetitiveness based on our medium-term business
policy by establishing an intermediate holding company
and reorganizing our organization with the aim of
expanding our group structure.

Overview of Results for FY2021
In FY2021, the advertising market as a whole was active
against the backdrop of the decline in advertisingdemand in the previous fiscal year. As we responded
quickly to changes in the environment caused by theoutbreak of COVID-19, we achieved growth thatexceeded the market average, and both net sales andrevenues reached record highs.
We are also making steady progress in collaboration
with the Dentsu Group, centered on online and offline
integrated proposals. In this fiscal year, both the numberof clients in collaboration and the unit price per clientrose, resulting in a significant improvement inFuture Strategy
We will place deepening the alliance with the Dentsu
Group at the heart of our business growth strategy, andaim to further expand our market share while maintaining
high profitability.
In the digital advertising domain, we will strengthen

collaboration between the Dentsu Group and us andmaximize the synergies, thereby increasing the value ofservices to clients through online and offline integrated
proposals and leading to an increase in unit prices. In
addition, we will expand our resources and grow ourorganization through aggressive investment in humancapital. Through these multiplications, we will realize
earnings growth while maintaining productivity, andaccelerate profit expansion as a profit center.
In the data & solutions domain, we will expand
target markets by expanding capabilities throughdeeper collaboration and further expanding ourdevelopment structure, with the aim of achieving
further earnings growth.

At a Glance
Trend of revenue and Non-GAAP operating profit
Revenue

Non-GAAP operating profit(unit : ¥mn)
30,00020,00010,000026,40015,0794,774
FY201915,8075,248
FY2020

Revenue

Number of clients in collaboration with Dentsu

18,869¥million (19.4% increase YoY)(

18,8696,991
FY20218,400
FY2022(Forecast)

108
1.6

companies

times increase YoY)

Domestic brand advertising transactions

Number of employees

9.49

1,080

¥

billion (1.5 times increase YoY)

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Digital Marketing BusinessYuichi Kouno
Message from an Executive Officer

President, SEPTENI CO., LTD.
Group Senior Executive Officer
In charge of Digital Marketing
Business & Dentsu Collaboration

Expanding Our Share of the Digital Marketing Market

Awareness of the Market Environment
and Future Growth Strategy
The size of the advertising market in Japan was ¥6.8
trillion in 2021, an increase of 10% representing a
recovery from the market's contraction in 2020. Among
those numbers, digital advertising expenditures grewsignificantly (¥2.7 trillion, 21.4% increase year-on-year)
compared to expenditures in the four forms of mass
media (¥2.4 trillion, 8.9% increase)*. Going forward, we
expect the usage of various types of solutions, including

those related to digital media, to advance at greater
speed than ever before.
In these circumstances, we will increase our share of
the digital marketing market through organic growth andby creating client value through collaboration with theDentsu Group as we push forward with initiatives toexpand the size of the solutions market. At the sametime, we will grow our organization through active
investment in the underlying human capital.
*Reference: Dentsu Inc. Marketing Report: 2021 Advertising Expenditures inJapan, published February 24, 2022

Illustration of market share growth
Increase unit prices

Overall digitalmarketing market

Digital advertisingmarketSolution market

Broader target markets

Our market share

Organic growth+
Collaboration with
the Dentsu Group

Expand in the solution market by strengthening
collaboration with Dentsu Digital

Medium-term management policy target

Aiming to expand
market share

Increasing value provided and sales
per client through online-offline
integrated marketing proposals
Promotions had previously been handled based on
separate planning for digital advertising and mass
advertising for each client. Now, an integrated
online-offline approach is needed to accommodate
diversifying consumer demand.
Based on changes such as these, our group iscollaborating with the Dentsu Group and other solutions
companies on stronger full-funnel proposals that go
beyond online and offline. Additionally, in direct
marketing which we have focused on since originallyestablishing our digital marketing business, we added
Dentsu Direct Inc. to the group starting this year in 2022
as we aim to strengthen our all-in-one proposals to ourclient companies.
There are other companies that handle online-offline
integrated promotions, but the decisive difference is that
we provide more effective mass media planning linked
with digital, as well as creative development, reporting,and more, through our horizontal alliance withcompanies in the Dentsu Group. We can put together
ongoing systems that are a close, familiar presence forour clients.

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Digital Marketing BusinessMessage from an Executive Officer

The results are clear in the number of clients and thesales of our collaborative business. Currently, collaborative
sales comprise approximately 25% of our total sales, but
this proportion will increase significantly over the next
several years. We want to provide even higher value
through proposals that mutually utilize each other’sservices, expanding the breadth of areas where we cantackle clients’ issues, contribute to clients’ businessgrowth, and turn these efforts into higher sales per client.

Trends of collaboration clients by year
Number of clients for collaboration with the Dentsu Group

108
68

23
FY2019FY2020

FY2021

Working in Alliance with Dentsu Digital
to Expand the Breadth in
the Solutions Market
As more issues can no longer be resolved throughadvertising alone, the importance of solutions has been
increasing. Packages that integrate advertising withsolutions are now in demand.
To meet this demand, one example of a solution we
offer is “Precog,” which links data owned by clients toincrease the effectiveness of their advertisements. Also
“Odd-AI”, a tool that uses AI to predict the creative
effects of advertisements before publishing can improve
the investment efficiency of advertising. Combining
these with solutions from Dentsu Digital which has
strength in data for mass advertising, we are striving toprovide even greater value to client companies.
Also, Septeni Data Solutions provides solution
development and manpower support to clients, in addition
to actively working on in-house solution development.

Actively Investing in Human Capital
Building Environments Conducive toGrowth and Plotting Growth of
the Organization
Hiring and development of personnel are essential for
our work on these measures. Our hiring has been
focused on new graduates, but from the standpoint ofhandling increasingly diverse solutions, we will be hiring
more mid-career professionals going forward.
For human resources development, we have training
systems catered to the diversifying market. We are also
compiling personnel data to enable each and every
employee to harness their skills and experience to thefullest while strengthening our support systems. For
initiatives such as promotions skipping multiple ranks in
new areas and participation in management for
employees who represent our next generation, we arededicating energy to creating work environments
conducive to employee development. In our alliance with
the Dentsu Group as well, we are looking to uncover newopportunities that will lead to employee development.
Our employees take the initiative to challengethemselves at providing even better services and newvalue to our clients. They contribute to the growth of ourclients’ businesses. By doing so, we ourselves cancontinue to grow and develop. Through this positive
cycle, I hope the Septeni group can achieve even moreorganizational growth.
See page 46 for more about our human resources development.

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32

Media Platform BusinessBusiness Overview
In the Manga Content Business, efforts are being madeto nurture and support manga artists for the purpose ofplanning and developing the Company’s own intellectual
property (IP). At the same time, GANMA! mangaapplication, which consists of original products bydedicated artists, is operated as the Company’s own
media. In addition, the Company develops platform-typebusinesses related to “recruitment,” “social
contribution” and “childcare” as new businesses bornfrom intrapreneurship.

Strengths

Issues• Business development capabilities and expansion into
other fields• Knowledge and expertise in developing new IP• The structure of the business is vulnerable toimpacts from seasonality and the market environment• Nurturing in-house IP• Substantial shifts in the market environment ineach business

Opportunities• Domains targeted in each business are growing• The D2C market is growing

Business ModelMedia platform business
Development
Providing works

In-app purchase / support
Manga content business

Manga artists• Management of manga artists• Manga contents app (GANMA!)Distribution

Advertising sales
Provision of information on job seekers

Activity support
Corporation &organizations

Recruitment platformbusiness

Registering information

Social contribution
platforms business

Online supportive actions

Childcare platform business

Users

Sales of parenting goods

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Media Platform Business

new business domains, posted year-on-year increases inrevenues and a smaller loss.

Overview of Results for FY2021
In the Manga Content Business, billing revenues
increased significantly, driven by strong subscription
revenues and e-book sales. In particular, one of
GANMA!’s popular titles, “My Lv.999 Love for
Yamada-kun,” has contributed significantly to growth ine-book sales. It was also a year in which the presence of
our original works grew, with the YouTube anime of“Ultra-Fem Shishihara-kun” being well-received.
In other businesses, as each of the businesses grew,
existing businesses, which exclude investment to expand

Future Strategy
In the Media Platform Business, our medium-termbusiness policy aims to achieve profitability in existing
businesses, excluding investment for the expansion of
new business domains. To achieve this goal, we arepromoting the development of our next core businesswhile maintaining appropriate financial discipline.
In the Manga Content Business, we will strengthen our

intellectual property (IP) development capabilities inorder to generate more hit titles, and also work to further
enhance the value of our IP holdings. We will also focus
on enhancing our brand as a platform in order to firmly
convert the content we create to earnings.
In other businesses, we will aim for further growth inthe overall business by further growing each business asa platform.

At a Glance
Revenue and Non-GAAP operating profit
Revenue

Non-GAAP operating profit(unit : ¥million yen)
4,000
3,000
2,000

2,005

4,000
2,487

2,885

2,885

¥

Subscription revenue
million (16.0% increase YoY)

Number of employees

1,000
0
1,000

Revenue-901

FY2019-956
FY2020-1,110
FY2021-800
FY2022(Forecast)

92

Approx.

60

x (for 5 years)

Accumulated application downloads

Approx.

15

million DL

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Media Platform BusinessYuki Fukunishi
Message from an Executive Officer

Focus on creating hit content and improving media
profitability to survive growth markets

Significant increase in earnings due tothe functioning of business steps forfostering content and monetization
Since the start of the Manga Content Business, we havein-house editorial departments and platforms, and wehave been developing and verifying our service
operations and content. As a result, we have improved
our brand and IP development capabilities, which have
led to the creation of hit content.
As of the end of 2021, many of the top titles in
GANMA!’s total rankings were contents launched in thepast 3 years. In addition, most of them are by the manga
artists who debuted in GANMA! or who created theirsecond and subsequent titles for GANMA!. The
opportunities of encounters with talented creators haveincreased, and we have improved our IP development

Awarded 4th place in the
Web manga category of
The NEXT MANGA
AWARDS, determined byreaders‘ popularity voteability through repeated creation of works. For example,“My Lv.999 Love for Yamada-kun,” which started in
March 2019, has steadily increased readers andengagement. As a result, it has become a hit content
that has been supported by many people inside andoutside GANMA!
In terms of platforms, amidst an increasinglycompetitive promotional environment, we willthoroughly improve acquisition efficiency by making fulluse of the flexibility and speed of being an in-house IP,
as well as a media strategy with the scarcity of age
ratings of the “12+” in app stores. On top of this, wehave refined “GANMA! Premium,” a subscription-based
billing model, and worked to improve the billing rate.
We are currently in the process of implementing
measures and verifying data, but as a result in the mostrecent year, subscription billing revenue has grownapproximately 1.8 times.
Another major achievement is the growth of e-books.
In this year, we began dealing with all major domestic
e-bookstores. We are doubling revenues by deploying
the broad range of contents owned by GANMA! in linewith the characteristics and demands of eache-bookstore. The business steps of; (1) creating strong
contents, (2) increasing awareness by producing themwhile making them profitable on our own platforms at an
early stage, and (3) turning them into e-books when

Executive Officer,
COMICSMART Inc.
Group Executive Officer
In charge ofManga Content Business

content volumes accumulate and making them profitable
outside of GANMA!, are functioning.

Full-scale expansion into anime areas
and further strengthening content
production capabilities
In February 2021, we spun off the anime business andlaunched “Qzil.la,” a digital anime studio, in order tomore directly engage in the anime domain to boost
the content.
The domestic publishing market is growing centeredon e-comics, and there is a major surge in Webtoon
contents. There are many content studios as well as
media platformers newly launched, and competition will
intensify in proportion to the rise of the market. However,
we will survive this growing market by combining“partnerships” with leading companies, based on thestrengths we have built up in-house, such as “editorial
departments,” “media,” and “anime.”

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35

Media Platform Business

Close Up

01 Smash Hit Content on YouTube Anime: “Ultra-Fem Shishihara-kun ”

At the end of 2020, we began streaming the YouTube
anime based on the manga “Ultra-Fem Shishihara-kun”
currently appearing serially in GANMA! The characters area big strength of this manga, and they have also been ahuge hit on YouTube. The response has been
overwhelmingly positive since almost immediately after
the channel was created. It has now become an iconic title
among YouTube anime, totaling over 300 million views
with more than half million subscribers to the channel.

Close Up

Attracting a broad range of fans regardless ofage or gender
Channel subscriber demographics
Female46.3%

Channel subscribers: 550,000
Average views per video: 2.54 million
Total views: more than 300 million

Age 13–17
Age 45–54
19.3%

13.4%
Age 18–24
14.7%(Note) As of February 2022

Male

Age 35–44

53.7%

32.9%

Age 25–34
12.4%

02 Established Digital Anime Studio “Qzil.la”

In February 2021, we established digital animation
studio “Qzil.la” with the aim of full-scale expansion into
the anime domain.
Including producer Shun Fukudome, who started his
career with a major anime production company, thestudio is loaded with highly experienced creators, fromnovelists to animators, art directors and more. Qzil.la isbuilding on its library of works primarily in short anime as
they establish their brand.
One example is the collaborative anime music video(MV) which combines the song “AntiSystem’s” by
jon-YAKITORY with manga production Gabuli by thecreative team called No.965. The video has more than
1.8 million views on YouTube.

Comments from the Business Director
With our mission of bringing about a monumental revolution
in the animation industry through the power of digital andtechnology, we aim to be number one in the industry byleveraging high production quality with technology. In
FY2021, we also focused efforts on music video production.
We pour our heart and soul into every production so thatpeople will say, “The quality of thatanime studio is the absolute best!”
I hope we can keep inspiring evenmore people with lots of productions.

Shun Fukudome

Representative
Director & Producer Qzil.la Inc.

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Expanding into New Business Segments
In our Medium-Term Business Policies published in October 2019, we are pushing forward with efforts we refer to as “Expanding into New
Business Segments,” to grow our business beyond the internet and into new territories for us such as real estate, sports, and entertainment.
Leveraging the internet-related business expertise that our Group has built up over the years in industries other than the internet, we will
seize the momentum in recent years of the digital shift and DX. Doing so, we will help to create a world where the power of technology
makes various industries and whole society flow more seamlessly and smoothly, while at the same time creating the drivers of future growth.

Focus Fields

State of Business in FY2021

Future Strategy

HR Technologies
Utilizing our in-house developed AI
matching system “HaKaSe” which
optimizes human resources development
on a person-by-person basis, we support
a full series of companies’ HR initiatives
from hiring to learning and development.

SportsParticipation in the Dai-Ichi Life
D.League, the first ever professional
dance league originating in Japan, andteam management, learning &development for D.Leaguers

Entertainment
We are supporting the digital shift ofthe entertainment industry, operating incommunication design, content
management, and business support.

• Providing “HaKaSe Onboard” DX service that supports
employee onboarding.
• Received the Encouragement Award for services
business operators at the HR Technology Awards 2021

• From providing the cloud services we currently offer
for onboarding, we also plan to push forward withexpansion into the realm of hiring and build a systemof comprehensive DX services from hiring to training.

• Participated in the Dai-Ichi Life D.League 2020–2021
season which began in January 2021

• Participated in the Dai-Ichi Life D.League 2021–2022
season which began in November 2021. Currently goingall-out in an effort to advance to the championship• Our team narrowly fell short of advancing to thechampionship but won the most rounds during theseason which tied the league record• Advancing new business development including
partnership sales and casting businesses launched lastyear, and the league’s first club token• Launching collaborative products together withmajor entertainment agency• Contributing to the further growth of industries byhandling operations such as community management,
content production, and business development withdigital as a starting point amidst growing needs for
new business models and shifts to digital• Building content production platforms to galvanize
fan communities

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Expanding into New Business Segments

Close Up Commercialization in HR Technology:
Employee Adaptation and Development Solutions Using Our Original HR System
The tertiary sector of the economy, the services sector,
comprises around 70% of Japan’s total GDP*1. In this day
and age of rapidly changing business referred to as the
VUCA age (Volatility, Uncertainty, Complexity & Ambiguity),
it is no exaggeration to say that human resources are thesource of economic growth. With Japan’s working-age
population projected to decrease by 40% over 40 years
starting in 2020*2, maximizing human assets is a key topic

in the Septeni Group. We aim to achieve it by leveraging
the HR technologies and data we have establishedthrough 20 years of research and development.
In January 2021 we launched onboarding service
HaKaSe Onboard with the aim of supporting companies
in the adaptation and professional development of theiremployees. We also obtained the relevant patents.
Based on AI assessment technology, HaKaSe Onboard

Features of HaKaSe Onboard
Job offers/Transfers
Matching

Assignment

First month

One to three years

Mutual understanding

Feedback

Feature 1

Feature 2

Onboarding kit
Mutual understanding tool
based on FFS theory* Theory that scientifically maps
combinations of people,
provided by Human Logic
Laboratory Co., Ltd.

Reviews should be performed
every three months

Peer reviews• Recognize presence andstrengths

Follow-ups according toindividual circumstances• Evaluate adaptation &development

offers highly reproducible employee adaptation andprofessional development by analyzing employee andworkplace data to propose optimized onboarding
measures for each individual. User companies of manydifferent sizes in a broad range of industries are alreadyusing these services. In response to the extensive
feedback received, we are working on improvements tooffer even higher value with HaKaSe Onboard services.
Going forward, we plan to generate success cases andalso devote energy to marketing activities that spreadawareness about the advantages of onboarding.
We are also working to leverage the expertise of theSepteni Group to support DX in HR that utilizes data
accumulated by each user, with the aim of expanding thevalue we provide while increasing our profitability.
*1 Ministry of Internal Affairs and Communications Japan, Information andCommunications in Japan White Paper 2017
*2 Cabinet Office, SNA (National Accounts of Japan) Annual Report on
National Accounts (GDP by industry, etc.)

See page 46 for more about digital HR and human resources
development in the Septeni Group.

Feature 3

AI matching
Optimized hiring and assignments
based on past data

Manager follow-ups by personal analysts
Accumulate adaptation & development dataat each workplace

Tatsuya Shindo

Representative Director
Human Capital Lab, Inc.

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03
Sustainability
Discussion: Update to “Sustainability”

P39

Priority Challenges and Identification Process

P44

Priority Challenges in the Septeni Group

P45

Priority Challenge 1: Industry Development
through Utilization of AI

P46

Priority Challenge 2: Development of High-Quality
Human Resources

P46

Priority Challenge 3: Diversity & Inclusion

P49

Priority Challenge 4: Support the Sound
Development of the Digital
Advertising Industry

P51

Priority Challenge 5: Support for Culture, Sports andP52
the Entertainment Industry
Environment

P53

Corporate Governance

P54

Messages from Outside Directors

P58

Structuring a Management Team Using FFS Theory

P59

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Discussion

Update to “Sustainability”
Koki Sato
Representative Director and President,
SEPTENI HOLDINGS CO., LTD.
Group President andChief Executive Officer

Yoko Miyazaki

General Manager
Public Relations Department

In January 2022, the Septeni Group newly declared its ambitions toward sustainability
and established the Sustainability Committee. Representative Director and President
Koki Sato and Sustainability Committee member Yoko Miyazaki from the Public
Relations Department discussed the background behind this and the structure, as
well as the Group’s outlook and related initiatives going forward.

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Discussion: Update to “Sustainability”

The Sustainability Committee isan implementation team tasked
with making business activities
themselves sustainable.

Sato: In the past, we had been working on activities totangibly visualize the positive impacts of the Septeni
Group’s business on society. We are particularly firm in
believing that environments that generate
entrepreneurship and investments in human capital will
inevitably be reflected in the form of long-term financial

returns. However, we thought more deeply about how tocommunicate these initiatives to stakeholders in a way
they can better understand, which led to us establishing
the Sustainability Committee.
First, we needed to bolster and organize systems andteams for communicating with the outside world, so weestablished the Sustainability Committee as an update of
our CSR Committee and gave it a significantly higher
position in our hierarchy. The CSR Committee had been
under the direct control of the president, but the
Sustainability Committee is an advisory body for our
Board of Directors. It receives requests from the Board of
Directors while engaging in activities that contribute tolong-term business growth, then provides feedback onthese activities back to the Board of Directors.
As opposed to a general advisory board, the role of thecommittee is to make our business and corporate activities
themselves more sustainable and to become an
implementation team for business transformation. For thatreason we added Outside Director Yoshiki Ishikawa, who
has extensive knowledge in the field of sustainability, as anadvisor to the committee. We also structured thepersonnel of the committee with employees playing thecentral roles, in a way that enables the generation who
represent the Septeni Group’s future to actively participate.
Miyazaki: I believe that having engaged in so many CSR
activities is precisely what made this update to ouroperational infrastructure possible. Assigning someone incharge of ESG for each business domain is also a bigchange from the way our organization worked before. Thisis likely to become an extremely important infrastructurethat will make our business sustainable.

“Serious” team lineup withmaximum diversity to generatesocial impact

Sato: For the personnel makeup of the committee, we
emphasized promoting diversity and inclusion, particularly
the elimination of gender gaps. There are three female
members on the committee. There are also two younger
members of the committee representing the future
generation, one of whom is in their second year with thecompany. It is a meeting that is conducive to participation

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Discussion: Update to “Sustainability”

and speaking up regardless of position, age range, orgender, and has the most diverse membership of any
meeting body in the Septeni Group. That shows just how
serious we are about this initiative.
Miyazaki: The Septeni Group has always had a culture ofproviding all types of opportunities to those who act on
their own initiative, regardless of gender, age, or
nationality. I still also thought that this diverse lineup ofcommittee members sent a powerful message in the
pursuit of diversity and inclusion.

Working on setting KPIs andestablishing data infrastructure
as top priorities

Sato: There will probably be many projects from along-term perspective among our sustainability efforts,
but I also consider it important to comprehensively
explain our short-term initiatives and progress tostakeholders. And as we implement the single fiscal year
or medium-term business plans for each individual
business activity, we also need KPIs indicative of both
short and medium-term effects and long-term effects toshow that our sustainability activities actually are making
the Septeni Group more sustainable. I think what we need
to work on right now is to set these KPIs and establish thedata infrastructure for managing them.

For human resources, we have been establishing HR
technology platforms over the past 10 years or more. Fromthese, we have obtained our own original algorithms byteaching them to AI, which we are fully utilizing in the formof predictions for organizational operations and businessactivities. This has enabled us to visualize our humancapital. I think that visualized value of human capitalthrough scores for each individual is a unique metric todisclose, which might even be unprecedented in the world.
Miyazaki: I would like to work on establishing data
infrastructure that makes it possible to visualize businessactivities that positively impact society. CSR and businesshave often been seen as somewhat separate until now,
both inside and outside the Septeni Group. Therefore, Ialso consider it an important role of the Sustainability
Committee to visualize how the company and society areconnected and to create contact points from a variety ofperspectives to make more employees aware of how theirwork is connected to the advancement of society. Can you
offer any advice on visualizing this overlap and instilling it
into our employees’ minds?
Sato: In my opinion, the difficult thing about instilling thismentality in-house is getting the business departments tounderstand it. It is probably not very easy to bridge thegap between the perspectives of sustainability activities
that look 30 or 50 years into the future, and the businessside that is focused on today, and this week. Ultimately, we
will need to improve literacy by remaining diligent in ourefforts and actions. Continuously engaging in these
activities will exponentially increase the number of those
who cooperate and understand. That itself is anothersustainable activity.

Exploring and engaging in activities
that only the Septeni Group canengineer in the social field

Sato: Breaking down ESG into its three components,
initiatives in the Septeni Group for governance (G) are making
good progress, so our current key topics aim to leverage thestrengths of the Group in areas related to social (S).
More specifically, first is to promote diversity &Inclusion. To make the most of our human capital, we areestablishing environments where anyone who works in
the Septeni Group is able to exercise entrepreneurshipand thrive.
Next is to improve transparency and soundness. In thedigital marketing industry, there have been increasing calls
for transparency and soundness from the perspectives ofdata management and privacy protection in recent years.
We will take leadership in working on initiatives that makethe industry more sound as a whole.
Last is leveraging AI. We have a knowledge basegained from leveraging AI in our human resources
infrastructure. I want us to give this knowledge from ourpast initiatives back to society to help make relationships
between people and organizations smoother, while at thesame time maintaining our connections throughout theworld. If we can do that, in addition to growing our own
business we will also be helping to make society happierand more prosperous.

Integrated Report 2021

Discussion: Update to “Sustainability”

Miyazaki: That is what we have been doing to this point,
but I think we should also adjust these priority challenges
when our sustainability efforts bring to light any new
topics to address.
Sato: Indeed. In addition to that, I also want to develop
the Sustainability Committee itself even more going
forward. I want to turn it into a unit with a direct
multi-stakeholder interface. For example, the committee
can interact with all kinds of individuals who are related to
the Group, from investors and clients to business partners
as well as employees and their families, and get them
involved in our activities. That is the final form that I havein mind for the Sustainability Committee.
Miyazaki: It will be quite intriguing if we can accomplish that.

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Sustainability Committee Organizational Chart

Sustainability
Committee

ChairmanGroup President and Chief Executive Officer

Outside Director
Management Office (Corporate Planning Department / Public Relations Department)

Corporate Design
Manager

Employees under
30 years old

FemaleManagers

ESG Promotion
Managers in
Digital Marketing
Business

Philosophy Penetration
Project Volunteer employees
within the group

ESG Promotion
Managers inMedia Platform
Business

Priority Challenge

Priority Challenge

Person Responsible for“Support the Sound
Development of the Digital
Advertising Industry”

The Subcommittee for the Support
for the Sound Development of
the Digital Advertising Industry

Person Responsible for“Development ofHigh-Quality Human
Resources”

The Subcommittee for
the Measures against
Discrimination and Harassment

Priority Challenge

Person Responsible for“Industry
Development throughUtilization of AI”

The Subcommittee
for the Promotion of
Women’s Participation

SEPALLY RAINBOW (LGBT)
Volunteer employees within the group

Messages from Outside Directors

I look forward to seeing the path for non-financial capital to contribute to business value
The Septeni Group has established its new Sustainability
Committee as an advisory body for our Board of Directors. Our
Group is discussing materiality from long-term (through 2050) andmulti-stakeholder perspectives and provides reports and opinions
to the Board of Directors, including up-to-the-minute progress,
with the aim of continuously increasing our business value.
The committee is scheduled to meet once per quarter in its
first fiscal year in FY2022. Diverse committee members havebeen selected from throughout the Group, and they are
engaging in lively discussions. When doing so, rather than
general or all-encompassing discussions, they aim to establish
strategic metrics for our materiality purely from the perspectiveof continuously improving our business value. At the sametime, they also plan to coordinate how to deal with changes inthe environment (= sustainability policies) surrounding ourmateriality (risks, opportunities.)
I also participate in this committee as an advisor. I am
interested to see how the sustainability activities and non-financial
capital that the Group has worked on in the past—particularly theuse of AI to make the most of our human assets—will contributeto increased business value, and I am looking forward to seeing it
actually happen. I also hope to contribute.
As always, I look forward to the continued support andencouragement of our shareholders.

Yoshiki Ishikawa
Outside Director
SEPTENI HOLDINGS
CO., LTD.

Priority Challenge

Person Responsible for“Diversity andInclusion / Others”

Managers of Culture,
Sports and Entertainment
Related Businesses
ECHO (Environment) Volunteer
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Priority Challenges and Identification Process

The Septeni Group established the Sustainability Committee in January 2022.
By updating our CSR activities that we have been working on since 2016, we are more actively promoting activities in accordance with our priority challenges.

enhance our corporate value.
Currently, we are discussing the establishment of KPIs
and data disclosure for each issue, and are working on
quantitative disclosure of our activities so that they can beevaluated by our stakeholders.

Identification Process

Image map of sustainability priority challenges

STEP

1

Identify Issues
Identification of social issues based on the SDGs,
ISO 26000 and other international standards

Confirm Priority Issues
STEP

2

STEP

3

Comprehensive determination by the CSR
Committee of the importance of issues to the
Septeni Group’s businesses and stakeholders’expectations of the Septeni Group

Very highIn 2016, the Septeni Group established the CSR
Committee and has been working to help resolve social
issues through its businesses. The numerous challenges
that have emerged in modern society and their effects
cannot be separated from both corporate and businessactivities. In order to achieve sustainable development
together with our stakeholders, we believe it is necessary
to proactively address these issues and continue tocontribute to solving them. For this reason, we have madeit our policy to “contribute to the resolution of social
issues through our business” in our existing CSR activities.
In promoting activities, we identified five priority
challenges from among a number of social issues, basedon a comprehensive assessment of “stakeholders’expectations of the Septeni Group” and “importance to
the Septeni Group’s business.” In the identification
process, priority challenges are first discussed mainly by
the CSR Committee, and their appropriateness isconfirmed by the Board of Directors. In addition, thespecified challenges are reviewed on a regular basis,and priority themes may be replaced or redefined inlight of the situation of society and the Septeni Group.
We also examine risks and opportunities through theabove process.
In January 2022, we shifted to a Sustainability
Committee structure and once again reviewed our priority
challenges. Currently, we are working on five priority
challenges: “Industry Development through Utilization ofAI,” “Development of High-Quality Human Resources,”“Diversity and Inclusion,” “Support the Sound andDevelopment of the Digital Advertising Industry,” and“Support for Culture, Sports and the Entertainment
Industry.” We will continue to update the issues to better
suit society and the circumstances surrounding theCompany, as we aim to conduct sustainability activities toExpectations for the Group

Identification and verification ofpriority challenges

Identify Priority Challenges
Confirmation of appropriateness and identificationof priority challenges by the Board of Directors
High

Importance to the Group’s businesses

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Priority Challenges in the Septeni Group
Priority Challenge

1

2

3

4

5

Industry Development
through Utilization of AI

Development of High-Quality
Human Resources

Diversity & Inclusion

Support the Sound
Development of the Digital
Advertising Industry

Support for Culture, Sports andthe Entertainment Industry

Value Provided to Society

We aim to generate innovations invarious industries through the use of AI.
We are also working to help drive laborproductivity improvements through theuse of AI in HR.

Initiatives in FY2021• Leveraging AI in HR technology
Human Capital Lab, Inc. now offers the “HaKaSe Onboard” DX service that supports employee onboarding. We
are actively working to help improve labor productivity through support that enables employees to quickly
become contributors.
• Leveraging AI in digital marketing
We built display advertising creative production method Odd-AI Creation, which utilizes the advertising creative
solution tool Odd-AI that predicts advertising effects with AI among other functions. We have now launched it
as a service, as we aim to maximize advertising effects through synergies between humans and AI.

We aim to create open innovation byilluminating the “structure of humanresources development” from a scientificperspective and sharing it broadly
throughout society.

Within the Group, we are building a comprehensively streamlined data-utilizing HR value chain that spans fromhiring and onboarding to learning and development. We provide information that goes beyond the boundariesof the company itself, including our Digital HR Project human resources development research website where
we provide the outside world with quantitative verification reports on the changes in HR management underremote work, compiled from our accumulated databases. These activities have also garnered outside
recognition, including six consecutive years of receiving HR Technology Awards.

We aim to create a society where
everyone can be themselves and thriveby eliminating gender gaps andestablishing work environments wherediscrimination and harassment do notoccur. At the same time, we also aim to
help improve labor productivity.

In May 2021 we held our first ever Group-wide Diversity Month. For one month, we organized an intensive series ofdiversity and inclusion-related events and strived to raise awareness among all members of the Group. In addition
to efforts such as promoting women’s participation and LGBT-related initiatives, we also spread awareness about
diversity of experience by presenting the annual Diversity Awards, which were launched in 2020. We are pushing
forward with activities to generate innovation through diversity of experience and perspectives while ensuring thepsychological safety for anyone to be able to participate and thrive in the workplace with peace of mind.

We are engaged in activities aimed atachieving a safe, secure digital society
by helping to develop the digitaladvertising market to be more sound,robust, and exciting.

We work on brand safety, ad verification, and other initiatives to improve the quality of advertising. These
efforts have been recognized with JICDAQ certification as a quality verified business in both the “exclusion ofinvalid distribution, including ad fraud” and “ensuring brand safety according to the quality of advertising
destinations” categories. We are also dedicatedly tackling other issues in the industry, including initiatives
related to influencer marketing and cookieless capabilities.

We aim to create a world filled withinspiration while contributing to theadvancement of industry by supporting
athletes along with sports and players
in new genres and advancing DX in therealms of manga and anime.

Top foil fencer Toshiya Saito has been hired by the Septeni Group as a new graduate employee. We support
the ambitions of our employees who participate in sports. We have also formed the Septeni Rapturesprofessional dance team to participate in the D.League professional dance league originated in Japan. In
culture and entertainment, we aim to advance DX utilizing technology in the anime industry. We established
the anime studio Qzil.la and are releasing various types of productions.

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Industry Development through Utilization of AI
2 Development of High-Quality Human Resources
1

Read more about our efforts in“Development of High-Quality
Human Resources” here.

Using data according to digital HR guidelines
Data-using HR initiatives in the Septeni Group (Digital HR)
seek to maximize the growth of the individual. With thebelief that “increases in corporate value are achieved
through the growth of individuals,” we thoroughly adhere
to the three principles of mutual benefit, building trust,and controlling risk, so that these initiatives can remain
beneficial to both individuals and the company. Based on
this concept, we work to improve the literacy of Group
employees involved with digital HR and promote
understanding on the individual level by formulating
digital HR guidelines and publishing them internally andexternally, as we continue ourefforts to produce all-aroundbenefits for individuals,
companies, and society.

Addressing Social Issues with
AI Human Resources
Human Capital Lab and the HR Development Equation
Human Capital Lab was established within Septeni Holdingsin the Septeni Group as an institution dedicated to researchon HR data in order to maximize the performance of eachindividual employee. It is utilized for making businessdecisions and human resources development.
Research activities at Human Capital Lab are ongoing,
analyzing vast amounts of personnel data accumulated
over more than 20 years with the aim of illuminating the“structure of human resources development” from ascientific perspective. Human Capital Lab will continue
working to create even more innovation throughactivities such as externally publishing andcommunicating case studies and research findings fromwithin the Septeni Group, and joint research with othercompanies and universities.
In the Septeni Group, we define the concept of humanresources development not as “developing” but as“development through accumulation of good experiencein the workplace.” The idea is that mutual interaction
between the individual characteristics people are born withand the environments surrounding them influences their
growth. We define the environment (E) in the workplace as
the team (T) plus the work (W), and we believe that thehigher the affinity between these two factors and theindividual characteristics of the person (P), the higher the
likelihood that it will lead to significant growth (G).

The HR Development Equation

GrowthPersonality

G = P

+

In the Septeni Group, we develop and provide our own
original AI data solutions. In 2022 we began working on
capabilities for the video format of display advertisingcreative production method Odd-AI Creation, which
utilizes AI. We are pushing forward with activities that aim
to provide high-quality digital marketing solutions for theneeds of our clients, with a focus on synergies between
humans and technologies.

46

Read more about our efforts“Industry Development throughUtilization of AI” here.

As our society shifts to digital, the Septeni Group is actively working on many efforts utilizing technology
to solve society’s problems while adding an extra flourish of prosperity.

Leveraging data in digital marketing

Company
Overview

Environment

Team

Work

E ( T + W)

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Industry Development through Utilization of AI

2 Development of High-Quality Human Resources

Building an HR value chain in the Septeni GroupWe leveraged the human resources databases we had
accumulated over the years to build an HR value chain thatdesigns comprehensively streamlined services from hiring
to onboarding through learning and development. In hiring,
AI is used to calculate the likelihood of the hired candidates
succeeding after they join the company, and we use it as areference and as supporting materials when conducting HR
evaluations. By providing “career feedback” materials forprospective employees to envision their own career paths
after joining the company, we have also eliminated gaps
between before and after joining the company which has
improved the ratio of candidates who accept our job offers.
In onboarding, we utilize compatibility models derived fromour own original “HR development equation” for job
assignments by compatibility, based on quantitative
calculations of work environments that individuals can adapt
to more easily. For new employees, we are also actively

deploying initiatives to help them quickly become
contributors, such as providing “adaptation plans” basedon their own strengths and stumbling points.
Leveraging research to help solve social problems
through business
Based on research in addition to technology andexperience accumulated in the Septeni Group, weestablished digital HR cloud services and consulting
company Human Capital Lab, Inc. in 2021. Maximizing
human assets is a key topic in Japan, where theworking-age population is projected to decrease by 40%
over 40 years starting in 2020*. Human Capital Lab aims
to maximize human assets and develop its business byleveraging the latest technologies to help deliver solutions
to HR issues that companies and industries face.

VOICE
Shu Murakami
Recruitment Planning Section,
Recruitment Planning Department
Septeni Holdings Co., Ltd.
We are also building systems to properly manage the handling of
personal information during hiring considerations according to
our Digital HR Guidelines. Through individualized feedback, we
also want those who are interested in our company to feelreassured and be able to make a career choice they feel
confident about.

For details, see “Expanding into New Business Segments” on page 37.
* Reference: Cabinet Office, SNA (National Accounts of Japan) Annual Reporton National Accounts (GDP by industry, etc.)

Quantification technologies and databases
When considering assignments“Job assignments by compatibility”

Decided by calculating compatibility with staff andjob description at the assignment destination

When joining the company“Adaptation plans”

Explain how to relate to the staff and the jobat the assignment destination

Every three months after joining the company“Adaptation assessments”

Visualize level of adaptation to the assignment
destination, promote swift adaptation

Integrated Report 2021

Priority Challenges 1

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Company
Overview

Sustainability

48

Industry Development through Utilization of AI

2 Development of High-Quality Human Resources

Evaluations from Outside the Company

10th annual Japan
HR Challenge Awards 2021
Innovation Award
Septeni Holdings Co., Ltd.

Sixth annual HR Technology
Awards in 2021
Excellence Award, Recruitment Category
Septeni Holdings Co., Ltd.

Sixth annual HR Technology
Awards in 2021
Regional Revitalization Award
Mango, Inc.

Sixth annual HR Technology
Awards in 2021
Encouragement Award
Human Capital Lab, Inc.

2022 Edition ofBest Workplaces in Japan rankings
Large company category:
10th place

Our efforts carefully utilizing HR data
while learning the health and safety
status of employees even in remote work
arrangements, and building mechanisms
for managing in a way that suits eachindividual person, were recognized as
revolutionary.

Cogress media services for individualized
career support, and Data Feedback
Screening which gives students feedbackon their hiring results and provides careerdevelopment opportunities, wererecognized as beneficial initiatives forboth students and companies.

Initiatives using digital HR that haveachieved results such as increasing thenumber of entries from students in otherprefectures five-fold in three years andsharing this expertise to make Miyazaki
Prefecture as a whole more competitiveat attracting talent were recognized ascontributing to regional revitalization.

DX service HaKaSe Onboard which leads
to success in both the onboarding of new
employees and in DX was recognized asa service that can contribute to rates ofreturn on investment in human resources
by increasing repeatability from hiring
through development to the point ofswiftly becoming workplace contributors.

Rankings are determined through two
types of surveys, one for employees andthe other for companies. The Septeni
Group has been selected as a “bestcompany” for 11 consecutive years.

Messages from Outside Directors

Our mechanisms offering individuals opportunities for accelerated growth are
an important weapon for investing in human capitalThrough discussions in the Nomination Advisory Committee and
Board of Directors, we have come to strongly feel that our people
are the true source of added value creation. We see humanresources development as investing in human capital rather than HR
management. The idea is that maximizing the performance of eachindividual contributes to continuously increasing business value.
Based on the philosophy of human resources development not
being “developing” but rather “development through accumulationof good experience in the workplace,” we employ our own original“HR development equation” focused on establishing work
environments suitable for the growth of each individual.
HR technology has recently been garnering attention, but the
Septeni Group has been accumulating vast amounts of HR dataover the course of over 20 years and using it with various
technologies including AI to produce major results in HR measures.
Since we have quantified work environments and compatibility, we
are able to make swift, timely decisions as a mechanism forproviding rank-skipping and job assignments to individuals asopportunities for accelerated growth. This is a particularly important
weapon for our investments in human capital. As a result, we areable to develop managers and leaders of the highest caliber.
One issue is that although we have accelerated development
among employees in their 20s and made them contributors sooner, itfeels like the spark of entrepreneurship is taking longer to ignite inour younger employees as our company increases in size. I would liketo utilize AI human resources even more to help accelerate the paceof growth opportunities
provided to our young
digital natives. We willcontinue striving to“inspire the world withentrepreneurship.”

Etsuko Okajima
Outside Director
Septeni Holdings
Co., Ltd.

Integrated Report 2021

Priority Challenge

3

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Diversity & Inclusion

Company
Overview

49

Read more about our efforts in“Diversity & Inclusion” here.

The Septeni Group promotes diversity and inclusion based on the idea that employees of all backgrounds regardless of gender, age,or nationality, achieving maximum performance in their own respective ways, will lead to sustainable growth for the Group.

Promoting Diversity & Inclusion
In the Septeni Group, we respect all types of human rights
and accept each other’s diversity. We implement work
styles that leverage the strengths of each individual as we
promote diversity and inclusion with the aim of channeling
diversity into competitive strength.
We established our Group-wide Diversity Awards in2020 to instill awareness internally of the significance andbenefits of these activities and signal the Septeni Group’s
proactive intentions both internally and externally. We
accept ideas for “initiatives to create environments where
each individual can thrive and generate both innovations
and achievements” and award prizes at the Group Kickoff
to entries received which are judged to have particularlyhigh value.
Since 2021, we have also been celebrating Diversity
Month. For one month, we organize an intensive series of
events with the goal of having everyone take ownership ofpromoting diversity and inclusion.

LGBT-related Initiatives
We have established the Group-wide LGBT and allies
network Sepally Rainbow, which is actively engaged in“creating workplaces that increase job satisfaction for all
employees regardless of whether they are LGBT throughbetter understanding of LGBTs and having more allies.
Our awareness activities during Diversity Month in 2021
were conducted from many different touchpoints, including
an online screening of the Japanese film Kalanchoe no
Hana on the topic of group paranoia toward LGBTs.
These ongoing initiatives have beenrecognized for the fourthconsecutive year with a Goldranking in the PRIDE Index, an
initiative that supports sexual
minorities in the workplace.

Measures Against Discrimination &Harassment
The strengths of each individual can be leveraged byestablishing work environments where no one isdiscriminated against according to their gender, age,nationality, race, ethnicity, religion, principles, beliefs,
social status, disabilities, sexual orientation, or gender
identity. The Septeni Group is establishing suchenvironments by conducting harassment training sessions
for newly appointed managers, as well as initiatives suchas e-learning on the topic of “advertising expressions

that are considerate of human rights” to prevent andeliminate harassment.

Promoting Women’s Participation
We have been actively promoting women’s participation
since 2010. Striving to stay ahead of changes in our
employees’ life stages, expectations of society, and othersocial changes, we explore and implement measuresaccordingly to enable employees from various
backgrounds to work and thrive with a sense of security.
The ratio of female managers at our major Group
companies in Japan was 22% in 2021, representing good
progress from the 16.7% ratio in 2018. Going forward, we
intend to achieve a 25% female manager ratio in 2023
through in-house awareness-raising activities as well as
supporting both male and female employees in smoothly
taking childcare leave and other support such as forworking parents to balance their work and home lives.

Goal for promoting women’s participation: Female
manager ratio (major Group companies in Japan)

22.0%(October 2021)

25.0%(2023)

Integrated Report 2021

Priority Challenge 3

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

50

Diversity & Inclusion

TOPICS
Diversity Awards
The Diversity Awards 2021 was held in October 2021. At this second annual edition of the event, the grandprize was awarded to “Mentor Talk,” which broadens employees’ career potential by letting them speak
casually with a more senior employee who intrigues them, implemented by Septeni Japan, Inc.

Entries:

Aibi Nishida

32

Recruitment & Training
Department
HR Business Partner Division
Septeni Japan, Inc.

Comments from prize winners

Developing diverse careers through Mentor Talk
Since there are few people at our company who we can casuallyconsult about our own careers aside from our direct supervisors, someof us had been lamenting the lack of opportunities to learn about
positions and careers outside of the department we belong to. As asolution, we started Mentor Talk as an initiative to connect those whowant to consult someone about their careers with those who want to

Mami Ishii

Recruitment & Training
Department
HR Business Partner
Division Expert
Septeni Japan, Inc.

utilize what they have experienced in their own careers to help others.
This award is recognition for utilizing the diversity of experiences andcareers within the company, and I am tremendously happy about it.
We will continue providing Mentor Talk while making improvements
whenever possible so that anyone who needs assistance can casually
use it going forward.

Messages from Outside Directors

Recognizing a company culture where diversity-rich initiatives spontaneously occur
Over a year has passed since I was appointed as an outside
director for Septeni Holdings. Among all of the various ESG
initiatives here during that time, I have been highly impressed bythose aimed at facilitating diverse human resources. It goes
without saying that diversity management for accepting diverse
human resources, and investing in human resources by giving abroad range of opportunities to a broad range of people andpromoting their future growth, are very important in terms ofsocial value which is the ‘S’ in ESG.
One example is the Diversity Awards system to annually
recognize employees who worked on measures that contributed
to promoting diversity, for which I am also one of the judges. Thisfiscal year there was also the pandemic, and we received various
reports about supporting employees who are apt to feel lonely
when they do not come to the office. Among those efforts, I gavehigh marks to painstaking measures to support international
employees stationed in Japan who are particularly likely to sufferfrom loneliness. Needless to say, it is minorities such as
internationals in Japan who particularly struggle during crisis
situations such as these, and I think the company culture in whichsuch measures spontaneously occur is truly wonderful. I would likeour stakeholders to all know about our society-friendly initiatives
such as these.

Akie Iriyama
Outside Director
Septeni Holdings
Co., Ltd.

Integrated Report 2021

Priority Challenge

4

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Support the Sound Development of
the Digital Advertising Industry

Sustainability

Company
Overview

51

Read more about our efforts to“Support the Sound Development of theDigital Advertising Industry” here.

The Septeni Group implements initiatives with a focus on the Three Promises by the Septeni Group.

Addressing challenges in the industry
Policy for the sound development of
the digital advertising industry

Three Promises by the Septeni Group

1. Sincere response
We consider integrity to be the basis of everything
we do and we will act with the resolve of right andwrong rather than profit and loss. We will remain
conscious about the communication of useful
information to society through appropriate meansthat will lead to continual trust in Digital advertising
and will act to make all of the people involved smile
with the cooperation from the stakeholders.

Improve advertising quality initiatives
We provide a variety of solutions and promote ad
verification initiatives. We aim to protect advertisers’
brands by ensuring that advertisements are not served on
inappropriate serving surfaces, and to detect and reduce
all types of fraudulent (invalid) traffic, such as impression
padding by machines and clicks by bots. In recognition ofthese activities, JICDAQ certified us as a “Quality
Certified Business Operator” for both “exclusion of invalid
delivery including ad-fraud” and “assurance of brandsafety associated with the quality of ad placements.”

2. Improvement of quality
We will observe the relevant laws and regulations
and the rules agreed upon with the parties involved
and aim to establish internal operations which
preemptively avoids accidents or wrongdoings whilemoving toward the enhancement of quality service
through repeated education and improvement.

3. Challenging the possibilities
We will continue the challenge of using newtechnologies and techniques to enhance the valueof Digital advertisements and improve thesatisfaction of the stakeholders.

Influencer Marketing Initiatives
In order to prevent various problems related to stealthmarketing and to allow all influencers to conduct creative
activities and disseminate information with peace of mind,
the “3-minute manual for preventing stealth marketing
supported by WOMJ” supervised by the WOM Marketing
Council is now available on GANMA! This manga issupervised by the WOM Marketing Council, an
organization specializing in consumer-to-consumer

communication marketing activities, and conforms to the
WOM Marketing Guidelines, reflecting the latest findings
at this point in time.

Cookie-less Initiatives
Due to the growing importance of data privacy worldwide,
platforms such as Apple, Facebook, and Google are
increasingly regulating cookies that have been used for
digital marketing targeting distribution and effectivenessmeasurement. In response to this trend, the Septeni
Group is providing customized solutions to customers
through FLINTERS, a development company with many
experienced data engineers, and services utilizing Septeni
Japan’s proprietary solution “Precog Base.” Septeni Japanis also providing services using Septeni Japan’s proprietary
solution, Precog Base. We are working on educational
activities and the development and provision of solutions
to realize digital marketing that is more threefold thanever before, with even greater respect for data privacy
and appropriate acquisition and management of
personal information.

Integrated Report 2021

Priority Challenge

5

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Support for Culture, Sports and the Entertainment Industry

Sustainability

Company
Overview

52

Read more about our efforts in“Support for Culture, Sports and theEntertainment Industry” here.

Read more about our efforts in “Supporting the Culture, Sports, and Entertainment Industries” here.
We actively support the success of athletes, artists, and others active in a broad range of sports and cultural genres
and engage in activities aimed at contributing to the development of industry through the use of technology.

Supporting Sports
Supporting top athletes
We hired two top-level fencers as new graduate employees.

Fencing (Sabre)

Shihomi Fukushima

Professional Dance Team Launched
In August 2020 we formed the Septeni Rapturesprofessional dance team to participate in the D.League
professional dance league originated in Japan. With aneclectic group of professional dancers from every genre,
the Septeni Raptures create a diverse range of uniquevibes at each performance and never fail to captivate
audiences with fresh new surprises.

『©日本フェンシング協会/
竹見修吾』

Major Achievements
2015
2016

2020
2021
2022

All Japan Student Fencing Championships
Individual: Champion
U23 Asian Fencing Championships Team Champion
All Japan Student Fencing Championships
Individual Champion
All Japan Student Fencing Championships
Individual ChampionshipTokyo 2020 Olympic Games Team 5th Place
Fencing World Cup Greece Team 2nd Place

Supporting Culture
Vivivit, Inc. provides the Vivivit portfolio matching service
to connect design and art to work by enabling people tofind work through postings of productions. Over 2,700
companies across Japan are using Vivivit, which stands
alone as Japan’s largest platform with over 1.1 million
posted productions by designers throughout the country.
This service is creating a broad range of connections
between designers and companies by facilitating
information exchange in the job-hunting activities ofdesigners and the recruitment activities of companies
while also eliminating regional disparities.

Fencing (Foil)

Toshiya Saito『©日本フェンシング協会：
Augusto Bizzi/FIE』

Supporting the Entertainment Industry

Major Achievements
2015
2017

2018
2019
2021

All Japan Student Fencing Championships 2nd PlaceWorld Fencing Championships Individual 2nd PlaceAll Japan Student Fencing Championships
Individual Champion
Fencing World Cup Germany Team 3rd Place
Asian Fencing Championships Individual 3rd Place
Tokyo 2020 Olympic Games Individual 13th PlaceTeam 4th Place

Major Achievements• Dai-Ichi Life D.League 2020-2021 season: Overall 5th Place• Nomination for most valuable dancer (MiYU)• Won the most rounds during the season which tiedthe league record

Aiming to advance DX utilizing technology in the anime
industry, we established anime studio Qzil.la in 2021 andare releasing various types of productions.
For details, see Strategy & Performance > Media Platform
Business on page 32.

Conviction in“10X”

Integrated Report 2021

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

53

Environment

The Septeni Group aims to achieve a sustainable society. We strive to reduce our GHG emissions anduse resources effectively in order to reduce the environmental impact of our business activities.

TOPICS

Additionally, since 2019 our business cards have been
made with LIMEX, which uses limestone as the primary
raw material. Using materials made without water or tree
resin reduces our environmental impact.
In this report we are also disclosing our GHG emissions.
We are gaining an overall understanding of GHG emissions
throughout the Group and also utilizing the information for
future environmental initiatives in order to help achieve a
decarbonized society. The shift to remote work in 2020 and
2021 has significantly reduced GHG emissions from
employee commuting and business travel. The Septeni
Group will continue working to balance business activities
with lowering our impact on the environment.

Environmental Policy and GHG Emissions
Our Environmental Policy advocates reducing usage ofprinting paper, actively buying green, and implementing
measures to save resources and energy while also
recycling. Group-wide volunteer project Echo by Septeni
Group was formed under the Sustainability Committee
and plays a central role in our environmental initiatives.
The Septeni Group has been making efforts to go
paperless with internal documents and invoices while
striving for both operational efficiency and lower
environmental impact. Our transition to paperless has
made great progress since shifting to mostly remote work
styles due to the COVID-19 pandemic.

GHG Emissions by YearFY ended Sep. 2019
Emissions
t-CO2

Ratio

FY ended Sep. 2020
Emissions
t-CO2

Ratio

FY ended Sep. 2021

Year-on-yearchangeEmissions
t-CO2

Ratio

Year-on-yearchangeScope1

4.5

0.1%

5.5

0.1%

1.0

6.9

0.1%

1.4

Scope2

866.4

17.4%

768.5

15.9%

-97.9

719.6

14.8%

-49.0

4,117.6

82.5%

4,071.1

84.0%

-46.5

4,138.1

85.1%

67.0

2,572.7

62.5%

2,880.1

70.7%

307.4

3,259.1

78.8%

379.0

Scope3Category 1

Purchased goods & services

Category 2

Capital goods

102.6

2.5%

111.7

2.7%

9.1

196.1

4.7%

84.4

Category 3

Fuel & energy-related activities

129.0

3.1%

119.1

2.9%

-9.9

107.9

2.6%

-11.2

Category 6

Business travel

692.7

16.8%

368.6

9.1%

-324.1

106.2

2.6%

-262.4

Category 7

Employee commuting

166.5

4.0%

181.3

4.5%

14.8

35.2

0.8%

-146.2Category 8

Leased assets (upstream)

454.2

11.0%

410.2

10.1%

-44.0

433.6

10.5%

-143.44,864.6

Total

4,988.5

4,845.1

23.4
19.5

Environmental Project
Echo by Septeni Group

Group-wide volunteer project Echo was launched in2020. Formed under the Sustainability Committee, thisproject spreads environmental awareness throughout theGroup through activities including the in-Group social
media event Sep-Eco Challenge and distributing Loss
Flower virtual backgrounds for use in online meetings.
In 2021, we also switched from plastic bottles toaluminum can materials for drinking water distributed tovisitors. The aim is to help reduce our environmental
impact by using aluminum cans which have a highrecycling rate and are highly energy efficient whenrecycled. Echo is finding ways to spread awareness in theGroup about environmental issues by making
information available to everyone about the backgroundbehind this change of materials and also about
environmental problems with plastics.

Integrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Company
Overview

Sustainability

54

Corporate Governance

Basic Approach to Corporate Governance

The Outline of Corporate Governance

The Group considers that its corporate governance isbased on the development and operation to ensure that
actions are based on the Code of Conduct “Septeni Way”
and decisions are made in a transparent, fair and efficientmanner, so that compliance with laws and regulations andappropriate supervision (monitoring) of corporate
performance are carried out, under the mission of“Inspiring the world with entrepreneurship,” which is theGroup’s corporate philosophy.

The Group is managed under a holding company structurein which the Company is a holding company and its groupcompanies are operating companies. By separating thefunction of administering its overall business from executing
its individual businesses, the Group has been working tofacilitate the delegation of authority and strengthen the
Company’s function of monitoring the Group’s businesses.
The Board of Directors shall consist of a majority, at theminimum, of highly independent Outside Directors. The
Board currently consists of seven Directors, five of whom
are Outside Directors. It determines matters prescribed byGovernance Highlights

Governance Chart on January 4th, 2022

Number of Directors
As of January 2022

7

Outside Directors

5

Number of Auditors
As of January 2022

4

Outside Auditors

3

Board of Directors’ Meeting

Outside Directors/Auditors

General Meetings of Shareholders

Average Attendance Rate of
Directors at Board of
Directors’ Meetings

99%(Number oftimes held:13)

Average Attendance Rate of
Auditors at Board ofAuditors’ Meetings

Audit
operations

Board of Directors(Number oftimes held:13)

100%

Appoint and dismiss

Appoint and dismiss

Group Risk
Management Committee
ReportRequest forinvestigation

Whistleblower
hotlineAdvise99%(Number oftimes held:14)

Report andconsult

Board of Auditors

ReportCoordinate

Coordinate

Requestfor advice
ReportSustainability Committee

Accounting
Auditors

Coordinate
ReportInternal Auditing
OfficeGroup Executive Officer (Group Management Meeting)Group companies and departments

Notify and report

AdviseAppoint and dismiss

Nomination Advisory
Committee

Financial Results andDisclosures Committee

Select and supervise

Requestfor advice

Group President and Chief Executive Officer

Board of Auditors’ Meetings(FY2021)

Directors/Auditors(FY2021)

Average Attendance Rate of
Auditors at Board of
Directors’ Meetings

laws and regulations and the Articles of Incorporation andmatters concerning the execution of important businessand oversees the execution of business. Furthermore, aspart of strengthening of its corporate governance system,
the Company introduced an executive officer system inJanuary 2017. Under this system, the authority for making
decisions and executing business operation is delegatedto Executive Officers to the extent permitted by relevantlaws and regulations, in order for the Board of Directors to
mainly focus on the oversight (monitoring) of the Group
Executive Officers who are responsible for the executionof business (monitoring model-oriented).

Internal audit

Audit accounting

Integrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

55

Corporate Governance

Board of Directors
The Group Executive Officers are responsible for the
execution of business of the Company, that of thebusiness companies in its group or that across several
business companies. The Board of Directors appoints
Group Executive Officers in charge of respective areas ofbusiness operation, and the Group President and Chief
Executive Officer who concurrently serves as
Representative Director oversees the execution ofbusiness operations by the Group Executive Officers.
Moreover, matters to be resolved at the Board of
Directors meetings, those regarding which authority is tobe delegated to the Group Executive Officers and thoseto be reported by the Group Executive Officers to theCompany’s Board of Directors are clearly stipulated in theregulations of the Board of Directors.

Group Management MeetingGroup Management Meeting has been established, as asystem regarding decision-making on the execution ofbusiness, with the functions of supporting decision-making
by the Group President and Chief Executive Officer and of
considering important managerial matters of the group.

evaluates financial results information, information fortimely disclosure, etc. In doing so, the Company has put inplace a system that clarifies authority and responsibilities
and enables prompt and appropriate decision-making. On
the other hand, Nomination Advisory Committee, themajority of which consists of Outside Directors, has been
established as an optional committee of the Board of
Directors to handle personnel matters regarding thegroup’s management team (appointment, dismissal etc. of
Directors of the Company, Group Executive Officers andothers), in order to ensure the independence, objectivity
and accountability of the deliberation process.

Executive Session
Meetings attended only by the Outside Directors(Executive Session) are held once a month in principle,
thereby securing a place for information exchange andshared awareness from objective standpoints. Outside
Auditors, external accounting auditors and otherindependent outside people may attend such meetings,

Sustainability
Committee

The Company has adopted a company auditor system.
Under the system, there are currently four Company Auditors
including three highly independent Outside Auditors. EachCompany Auditor audits the execution of business by the
Directors, in accordance with the auditing policy, audit plans
and so forth determined by the Board of Company Auditors.

Various Committees
The Company has established a Group Risk Management
Committee that supervises risk management of the group,a Sustainability Committee that promotes sustainability
activities to enhance the corporate value and a Financial
Results and Disclosures Committee that reviews andKoki Sato
Etsuko Okajima
Yusuke Asakura
Yoshiki Ishikawa
Akie Iriyama

Nomination
Advisory
Committee

Major Agenda Items at the Board of
Directors meetings
Major agenda items discussed by the Board of Directors in FY2021(from October 2020 to September 2021)(excluding regularly scheduled agenda items)
Establishment of Intermediate Holding Company
Update about the Medium-Term Management Policy
Revision of Regular Agenda Items and Schedules of
the Board of Directors, etc.
Compliance with the Work Style Reform Law
Proposal for Executive Training Camp
Digital Marketing Business Strategy

Composition of various committees

Board of Auditors

thereby providing a place for promoting cooperation
among independent outside persons.

Executive
SessionOverseas Business Strategy
Media Platform Business Strategy
Transfer of Shares of Subsidiaries
Efforts to ESG
Application for Selection in New Market Segments in
Accordance with the Restructuring of the Tokyo Stock ExchangeStandards (Term of office) for the Reelection of Outside Directors

Mio Takaoka

Response to Adoption of Revised Corporate Governance CodeShuji Yamaguchi

Deepening Capital and Business Alliance with the Dentsu GroupIntegrated Report 2021

Conviction in“10X”

Message fromthe President

Value Creation
Process for “10X”

Strategy and
Performance

Sustainability

Company
Overview

56

Corporate GovernanceEvaluation of the Effectiveness of
the Board of Directors

Governance since the Capital andBusiness Alliance with the Dentsu Group

With the aim of enhancing the function of the Board of
Directors, the Company conducts analysis, evaluation andfollow-up examinations of issues on the effectiveness of
the Board of Directors once a year in principle. The
Company also conducts large-scale and detailed surveys
by external third-party institutions once every three years.
In FY2021, the Company reviewed the agendas andschedules of meetings through the discussion at themeetings and a training camp of the Board of Directors,
especially to follow up the survey and hearing previously
conducted based on advice from external third-party
institutions, regarding the operation status of the Boardof Directors.
As a result, the Board of Directors is managed
appropriately and the specific initiatives to improve its
effectiveness are promoted voluntarily under the clear
sense of purpose. In addition, ensuring effectiveness of
the Board of Directors was confirmed.
Also, as the Company recognizes that there is eachroom for improvement on balanced discussion,decision-making and reporting etc. to further enhance thequality of the discussion, the Board of Directors of theCompany should advance efforts to heighten its
effectiveness even more, by proactively implementing
measures that lead to resolve these issues.

The Company’s parent company is Dentsu Group Inc. Oneof the Company’s directors concurrently serves as an
executive officer of Dentsu Japan Network of the Dentsu
Group Inc. and an executive officer of Dentsu Inc., asubsidiary of Dentsu Group Inc. However, this director is ina position to supervise the execution of business in orderto enhance its corporate value as a non-executive directorof the Company. In addition, with respect to transactions
with the parent company, management guidance fees are
determined by agreements between the parties taking
into account the content of operations, and interest rates
on fund transactions are determined in the same manneras in general transactions with reference to market interest
rates. Through these various measures, the Company
believes that its business operations are sufficiently
independent from the parent company, etc. As a publicly
traded company with a parent company, the Company has
agreed to maintain its autonomy and independence in therelationship with the parent company under an agreement
between the parties. In addition, the majority of theCompany’s Board of Directors is independent outside
directors, and decisions concerning its management are
made through discussions based on the viewpoint ofprotecting minority shareholders. As a result, theCompany does not anticipate any harm to the interests ofitself or its minority shareholders.

Appointment and composition of directors• One director and one auditor (part-time auditor) will
be appointed by Dentsu Group Inc.
• Even after the capital and business alliance, themajority of our directors will be independent outside
directors, and our representative directors will be thedirectors who are not outside directors and who are
not appointed by Dentsu Group Inc.

Cooperation in management autonomy
and maintaining listing• Even after the execution of this alliance, the Dentsu
Group respects our autonomy, acts in such a manner
as not to conflict with the delisting standards tomaintain our listing, and cooperates with us to thereasonable extent.

Handling of Shares• Dentsu Group Inc. will not acquire any additional sharesof our stock without obtaining our prior written approval.

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57

Corporate Governance

Officer Compensation PlanIn FY2017, the Company introduced a new compensation
plan (BIP trust) to more clearly define the relationshipbetween the remuneration of the Company’s directors(excluding outside directors and non-residents of Japan)
and Executive Officers (excluding non-residents of Japan;
collectively, “Directors, etc.”) and the Group’s businessresults in the medium to long term as well as theCompany’s shareholder value, while creating a soundincentive to enhance business results and corporate value
in the medium to long term. As a result, remuneration for
directors of the Company consists of monthly

compensation and stock compensation, and remunerationfor outside directors who are independent from businessexecution consists of monthly compensation only.

BIP TrustThis is a performance-linked stock compensation plan thataims to establish a clearer relationship between
remuneration for Directors, etc. and the value of theGroup’s stock. The Company’s shares are purchased fromthe market as officer compensation, kept in a trust accountand delivered in accordance with the recipient’s positionand degree of achievement of the performance targets in
the Midterm Business Policies.

Director and Auditor Remuneration
Total amount of remunerations, etc. by type
Category

Number of payees

Total amount of officers’
remunerations, etc.

Basic remuneration

Risk Management
In order to recognize significant events that may affect theGroup’s business management, to identify, analyze andassess risks that may harm the growth and development of
the business and to make responses to the risks such as
aversion, mitigation, transfer and others, the Group shallestablish the “Group Risk Management Regulations.” In
addition, it set up the “Group Risk Management
Committee” as a body to oversee and manage such risks in
an integrated and effective manner under the common
policy as the Group. It constructs the PDCA cycle of risk
management operations and promotes risk management in
the Group as a whole to achieve sustainable development.
In FY2021, the Company selected priority risks for theGroup in view of the effects of COVID-19 infection, andimplemented these measures.

Performance-linked
remuneration, etc.
Risks in remote work environments

Non-monetary
remuneration, etc.

Information leakage risks
Directors(of whom Outside Directors)

8(5)

319,703 thousand yen(54,000 thousand yen)

223,110 thousand yen(54,000 thousand yen)

96,593 thousand yen(–)

Security risks
Risk of insufficient management for employees

Company Auditors(of whom Outside Auditors)

5(3)

37,500 thousand yen(21,000 thousand yen)

37,500 thousand yen(21,000 thousand yen)

(Note) Please refer to the following for supplementary information on remuneration of Directors and Auditors.
https://www.septeni-holdings.co.jp/en/company/governance.html#directors-compensation–(–)

Improvement of labor management and work environment

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Corporate Governance

Messages from Outside Directors

The Company has
an environment where
everyone openly expresses
opinions to each otherYusuke Asakura

Outside Director

The deeper capital and business alliance with the Dentsu Group was the biggest
discussion point in the Board of Directors over the course of the year. Based on the
progress of business since the capital and business alliance began in 2018, we reached ashared understanding that this would be a necessary and effective move for businessgrowth. However, all the way up until just before the deeper alliance was entered into, allof us outside directors debated the points of whether minority shareholders would notlose profits, and whether the intention that this partnership is for further growth would beunderstood. Based on these discussions we decided to begin making disclosures, also
including EPS.
The Nomination Advisory Committee that operates to establish enduring management
organizations not dependent on anyone’s individual ability can be considered anothercharacteristic of the Septeni Group. I think the formulation of succession plans not just for
HR involving directors but with sights set also on the next generation of management
teams and even subsequent generations after that could be considered ahead of its time.
Beyond that, I think the biggest characteristic of our Board of Directors is the open,
uninhibited discussions we have each month. As the ratio of outside directors has
increased, these discussions have gotten more intense each year. Some of these
discussions have ended up disorderly and resulted in resolutions being rejected due toopposition by outside directors. However, that can only even happen because we haveestablished an environment where everyone expresses opinions openly to each other. As
an outside director, I see that as extremely positive.

We thoroughly deliberated
the significance of the deeper
alliance from every angle
and timeline
Mio Takaoka

Outside Director

For a while, we had been discussing the significance of a deeper alliance with the Dentsu
Group as one option for the business strategy of the Septeni Group. Because we had
also been able to verify the cultural fit between the companies since the capital andbusiness alliance that started three years ago, it was easier to envision the success of the
deeper alliance.
Still, based on the idea that there could be opposition on a practical level even though we
had all reached a consensus, we considered every possible angle and timeline and thoroughly
deliberated between the executive side and the Board of Directors as well as within the
Board of Directors and amongst just the outside directors all the way until just before theresolution. We anticipate being able to provide even higher value services to our clientsand become a dependable presence for even more clients through this deeper alliance.
In the Board of Directors we leverage the expertise of each director while exchanging
opinions openly and candidly on a broad range of matters, from long-term strategies
such as organizational HR strategy, promoting innovation, and ESG, to individual matterssuch as M&A transactions. Doing so, we make decisions from a broad perspective.
Additionally, starting in 2022 we are holding what we call an Executive Session each month
involving only outside directors and auditors, where we reflect and discuss our concerns witheach other. With the goal of filling in the knowledge gap for outside directors who are not
involved in the day-to-day operations, the outside directors also take the initiative tocoordinate and provide feedback to the chair of the session. As a result, I think the executive
side, directors, and outside directors are able to communicate very smoothly with each other.

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59

Corporate Governance

Structuring a Management Team
Using FFS Theory

Board of Directors’ Personality Matrix
Offense (Creates the future)

Board of Directors and Audit &Supervisory Board Team

Position

Koki Sato

EtsukoOkajimaTadanobu
IseShuji Yamaguchi

Akie
Iriyama

YusukeAsakura

Leadership Type
Team-builder

Analytical

Name

YoshikiIshikawa

Intuitive

The Company has incorporated the Five Factors & Stress(FFS) theory into its AI-based personnel system and otheraspects of human resource management. Developed by
Human Logic Laboratory, Inc., this theory can be used toscientifically build teams of people. It quantifies fivefactors as well as stress levels for individuals to understandtheir thought processes and behavior.
By examining the characteristics of Board members
based on the FFS theory, the Company has structured a
Board of Directors with leaders who drive a team that canreadily adapt to emerging situations and relationships. This
enables operational flexibility in a rapidly changing
business environment. In addition, arrangements of offense
type and defense type are well balanced, and the team iswell-organized for both future creation and risk management.
Following here are a personality matrix of theCompany’s Board of Directors and the results of anindividual member personality analyses.

MamoruFurushima
Mio Takaoka

TakeshiOkuyamaDriverDefense (Solves problems)Tadahiro Mouri(Note) Please refer to the website for a brief biography, responsibilities, and status of each officer. https://www.septeni-holdings.co.jp/company/boardmembers/

Personality Profile

Name

Position

Personality Profile

Koki Sato

Representative
Director

A leader who embraces change. Has excellent judgment and determination.
Good at missions that require pushing the boundaries.

Shuji Yamaguchi

Director

Etsuko Okajima

Outside Director

A team-builder who embraces change. Persuades others to get on board
and cooperate. Good at reconnaissance missions for innovation.

Tadahiro Mouri

Yusuke Asakura

Outside Director

A rationalist and team-builder. Persuades others to get on board and cooperate.
Good at missions that require planning.

Outside Auditor(Full-time)

Mamoru Furushima

Outside Auditor

A rationalist and team-builder. Persuades others to get on board and cooperate.
Good at missions that require planning.

Yoshiki Ishikawa

Outside Director

A team-builder who embraces change. Persuades others to get on board andcooperate. Good at reconnaissance missions for innovation.

Takeshi Okuyama

Outside Auditor

A rationalist and team-builder. Persuades others to get on board and cooperate.
Good at missions that require planning.

Akie Iriyama

Outside Director

Multi-skilled with excellent flexibility. Balances offense and defense well.
Good at missions that require resourcefulness.

Tadanobu Ise

AuditorA team-builder who embraces change. Persuades others to get on board
and cooperate. Good at reconnaissance missions for innovation.

Mio Takaoka

Outside Director

A rationalist and team-builder. Persuades others to get on board and cooperate.
Good at missions that require planning.

Multi-skilled with excellent flexibility. Balances offense and defense well.
Good at missions that require resourcefulness.
A rationalist and team-builder. Persuades others to get on board and cooperate.
Good at missions that require planning.

(Note) We have obtained the consent of each Director and Auditor regarding the publication of personalities of each person.

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60

Corporate Governance

Executive Officer Team

Executive Officers’ Personality Matrix
Offense (Creates the future)
Isamu Ueno

Yuki Fukunishi

Koki Sato
Yusuke Shimizu
Tadahiro
MatsudaTei GoMasayuki Takano
Kei Hatano

Shuhei Ezaki

Team-builder

Teruyuki Noguchi

Analytical

Daisuke Suefuji

Masayuki Muto
Kazunari Kondo

Leadership Type

Yuichi Kouno

Yuta Suzuki

Yusuke Fukuhara

Intuitive

As a result of investigating the characteristics of theCompany’s Executive Officers based on the FFS theory, ahigh percentage of members take the offense type or thedriver type of leadership and excel at business promotion
with a sense of speed.
On the other hand, officers with the defensive type arealso allocated in a well-balanced manner, and risk
management in business execution can also be easy tofunction in this individualized arrangement.
Following here are a personality matrix of theCompany’s Executive Officers and the results of anindividual member personality analyses.

Takefumi Okada

Kana Setoguchi

DriverDefense (Solves problems)NamePersonality Profile

Name

Personality Profile

Koki Sato

A leader who embraces change. Has excellent judgment and determination. Good at missions that
require pushing the boundaries.

Daisuke Suefuji

A rationalist who embraces change. Good at reconnaissance missions for innovation.

Isamu Ueno

A team-builder who embraces change. Persuades others to get on board and cooperate.
Good at reconnaissance missions for innovation.

Masayuki Takano

A rationalist and team-builder. Persuades others to get on board and cooperate. Good at missions
that require planning.

Tadahiro Matsuda

Multi-skilled with excellent flexibility. Balances offense and defense well. Good at missions that
require resourcefulness.

Yusuke Fukuhara

A team-builder who embraces change. Persuades others to get on board and cooperate. Good atreconnaissance missions for innovation.

Yusuke Shimizu

A leader who embraces change. Has excellent judgment and determination. Good at missions that
require pushing the boundaries.

Takefumi Okada

A problem solver. Coordinates the interests of others. Good at missions requiring personal relations.

Yuichi Kouno

A leader who embraces change. Has excellent judgment and determination. Good at missions that
require pushing the boundaries.

Yuki Fukunishi

A team-builder who embraces change. Persuades others to get on board and cooperate. Good atreconnaissance missions for innovation.

Kei Hatano

A rationalist and team-builder. Persuades others to get on board and cooperate. Good at missions that
require planning.

Tei GoMulti-skilled with excellent flexibility. Balances offense and defense well. Good at missions that
require resourcefulness.

Teruyuki Noguchi

Multi-skilled with excellent flexibility. Balances offense and defense well. Good at missions that
require resourcefulness.

Shuhei Ezaki

A problem solver. Coordinates the interests of others. Good at missions requiring personal relations.

Kana Setoguchi

A rationalist who continues improvement. Good at missions that require risk management.

Yuta Suzuki

A leader who embraces change. Has excellent judgment and determination. Good at missions that
require pushing the boundaries.

Masayuki Muto

Multi-skilled with excellent flexibility. Balances offense and defense well. Good at missions that
require resourcefulness.

Kazunari Kondo

Multi-skilled with excellent flexibility. Balances offense and defense well. Good at missions that
require resourcefulness.

(Note) We have obtained the consent of each Executive Officer regarding the publication of personalities of each person.

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61

Consolidated Financial & Non-Financial Highlights (IFRS)(Unless stated otherwise, all figures in this document are based on units of million yen.)

FY2017FY2018FY2019FY2020

FY2021

Revenue

14,702

15,272

16,796

17,93821,384Gross profit

12,98912,674

13,962

14,596

17,285

88.3%

83.0%

83.1%

81.4%

80.8%

10,652

11,693

11,924

12,156

13,745

72.5%

76.6%

71.0%

67.8%

64.3%

2,325

1,011

2,065

2,452

3,796

15.8%

6.6%

12.3%

13.7%

17.8%

2,248

977

183

2,274

3,650

Ratio to Revenue

15.3%

6.4%

1.1%

12.7%

17.1%

Profit for the period attributable to owners of the parent

2,211

847

(547)

1,464

2,604

Ratio to Revenue

15.0%

5.5%

—

8.2%

12.2%

(Reference) Net sales

72,37572,44376,501

76,48997,606

Total assets

32,92933,37130,41334,42542,011Equity attributable to owners of parent

15,172

15,672

14,796

15,793

18,426

Ratio of equity attributable to owners of
the parent to total assets

46.1%

47.0%

48.7%

45.9%

43.9%

Cash flows from (used in) operating activities

(808)

(440)

1,258

2,340

4,619

Cash flows from (used in) investing activities(1,706)

(310)

(205)

(804)

91

Cash flows from (used in) financing activities

2,457

112

(1,411)(1,941)(1,914)

Cash and cash equivalents at the end of period

15,51914,922

14,48814,081

16,900Return on equity (ROE)

15.1%

5.5%

(3.6)%(9.6)%

15.2%

Basic earnings per share (EPS) (yen)

17.38

6.71

(4.33)

11.58

20.59

Equity attributable to owners of parent per share (BPS) (yen)120.08124.00117.02124.90145.72

3.2

2.0

2.0

2.0

3.4

Ratio to Revenue
Selling, general and administrative expenses
Ratio to Revenue
Non-GAAP operating profit
Ratio to Revenue
Operating profit

Dividends per share(Notes)1. Conventional “net sales” are voluntarily disclosed as reference
information, while “revenue” is disclosed as an indicator based on IFRS.
Revenues from advertising agency sales, which account for the
majority of the Digital Marketing Business, are recorded on a net
basis only for the margin portion.
2. “Non-GAAP operating profit” is voluntarily disclosed in order tomore appropriately express the actual state of the business andrefers to the profit indicator used to assess ordinary businessconditions after adjustments are made to IFRS-based operating
profit pertaining to temporary factors such as stock-based
compensation expenses, the impairment losses, and gains or losseson the sales of fixed assets.
3. Figures are rounded to the nearest digit.

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Consolidated Financial & Non-Financial Highlights (IFRS)Revenue

Non-GAAP Operating Profit /Ratio of Operating Profit to Revenue(unit : ¥mn)
25,00020,00015,00014,702

15,272

16,796

17,93821,384

Non-GAAP operating profit
Ratio of Operating Profit to Revenue(unit : ¥mn)
4,000
3,000

10,000

2,000

5,000

1,000

0

2017/92018/92019/92020/9Ratio of equity attributable to owners of the parent to total assets
Return on equity (ROE)

(%)

46.1

50
40
30
20
10
0
-10

15.1

2017/947.0
5.5
2018/948.7(3.6)
2019/9

45.9

43.9

9.6

15.2

2020/902021/9Ratio of Equity Attributable to Owners of the Parent toTotal Assets / Return on Equity (ROE)

Number of Employees at the End of the Fiscal Year
(Full-Time, Regular Employees)

1,083

1,189

1,147

1,224

1,251

2017/9

1,011

12.3

6.6
2018/92019/920

2020/92021/930202021/90-5

2019/9

34.6

14.4

16.7

0

2017/10

2018/10

2018/9(547)

8.2

2019/92020/920
1002021/9Dividend payout ratio

3.2

29.8

18.4

2.0

3.4
2.0

2020/92021/9

35.8

39.2
22.0

21.9

22.5

2019/102020/102021/100

2017/92018/9Ratio of new graduates
hired online*

100%*New graduates in 2021.

2019/9

(%)
40

30

2.0

1

Ratio of female managers

34.5

2017/95.5(unit: ¥)

2

(%)

33.4

-1000

3

Ratio of Female Managers / Ratio of Female Employees(Major Group Companies in Japan)
Ratio of female employees

04(4.33)
2018/9

15.0

12.2

1,464

847

Dividends per share

6.71

2017/9

1,000

2,211

(%)
30

Dividends Per Share / Dividend Payout Ratio

11.58

10

2019/9

17.8

2,000

20.59

5

20

2018/92020/9

17.38

10

20

2017/9

13.7

40

10

15

30

400

2,452

(%)
50

Profit for the period attributable to owners of the parent
Ratio of Operating Profit to Revenue(unit : ¥mn)
3,000
2,604

Basic Earnings Per Share (EPS)

50

800

0

15.8

2,065

3,796

(unit: ¥)
25

1,600
1,200

2,325

0

2021/9Profit for the Period Attributable to Owners of the Parent /Ratio of Operating Profit to Revenue

20

17.3

16.5

2020/92021/9100Number of employees
volunteering forcross-departmental
committees*138

in total*From 2016 to September 2021.

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Company Overview (As of January 1, 2022)

Trade NameSEPTENI HOLDINGS CO., LTD.

Headquarters Sumitomo Fudosan Shinjuku Grand Tower,
8-17-1 Nishishinjuku Shinjuku-ku,Tokyo

Business Overview Corporate management and overall control of group companies
through ownership of shares and other forms of equity.
October 1990

Foundation

Capital18,428 million yen

No. of Employees* 1,251 permanent staff/
1,511 employees* As of September 2021

Group Companies (As of January 1, 2022)
Digital Marketing Business (Domestic)

SEPTENI CO., LTD.

Septeni Japan, Inc.

MANGO Inc.

HighScore, Inc.

Digital marketing support
business

Digital marketing support
business

Digital performance advertising
operation business

Digital marketing support
business

SEPTENI CROSSGATE
CO., LTD.
Ad network and platformbusiness

FLINTERS BASE, Inc.

Tricorn Corporation

Milogos, Inc.

DENTSU DIRECT INC.

Development support and career
support for software engineer

Development of customer
relation management (CRM)
platform and digitaltransformation support business

Digital marketing support
business

Direct marketing support
business

Web marketing support business

DENTSU ELFTOARCHITECT INC.

Septeni Ad Creative, Inc.

Septeni Data Solutions, Inc.

FLINTERS, Inc.

Planning and production ofInternet advertisement creatives

Intermediate holding company ofdata & solution domain

Planning and development,
sales of data & solution domain

PRIME X Co., Ltd.

DENTSU DIGITAL INC.

Internet realty marketing business

Digital marketing support
business

Digital Marketing Business (Overseas)

Septeni Asia Paciﬁc Pte. Ltd.

Septeni America, Inc.

Septeni Global G.K.

Septeni China Limited

JNJ INTERACTIVE INC.

Lion Digital Global LTD.

FLINTERS VIETNAM CO., LTD.

Digital marketing support businessbased in Asia Pacific

Digital marketing support
business based in
North America

Digital marketing support
business based inJapan and Overseas

Digital marketing support
business based in China

Digital marketing support
business based in South Korea

Digital marketing support
business based in Southeast Asia

Planning, development andother web service business

COMICSMART, Inc.

Qzil.la, Inc

Vivivit, Inc.

gooddo, Inc.

TowaStela, Inc.

Delight Tube, Inc.

ALPHABLE, Inc.

Manga Content Business

Animation production
business

Employment platform business

Platform business of social
contribution

Childcare platform business

Planning, production andmanagement of Internet media

Management of service of looking for love, anddevelopment and sales of cosmetic products

Media Platform Business

Expansion into New Business Segments

PERF, Inc.

Participation in the professional dance league "D.LEAGUE”,
team operation and development

New Business Development

Human Capital Lab, Inc.

Providing solutions that utilize the AI matching system and supporting
construction of systems from recruitment to training

LIVAND, Inc.

Supporting DX in the entertainment industry

Septeni Incubate, Inc.

New business development and incubation

SIGNCOSIGN, INC.

Support for co-creation of
corporate design

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Stock Status (As of September 30, 2021)

Breakdown by the Number of Holdings Shares

370,080,000

Treasury stock

138,916,500

Indivisuals/Others

10,724,240
7.72%

38,767,838
27.91%

Domestic
corporations
42,107,501
30.31%

Number of shareholders

8,805

Foreign investors

Stock Price Range
(Yen)
600

Stock price (left scale)

Nikkei Stock Average (right scale)(Yen)
30,000500

25,000

Securities
firms

400

20,0005,004,990
3.60%

300

15,000200

10,000100

5,000

Financial institutions

21,371,131
15.38%

20,940,800
15.08%

0Major Shareholders
Number ofshares held

Percentage of total
shareholdings (%)

DENTSU GROUP INC.

26,895,001

20.98

Village seven Co., Ltd.

14,419,000

11.24

Mamoru Nanamura

12,450,500

9.71

Custody Bank of Japan, Ltd. (Trust Account)

10,174,800

7.93

The Master Trust Bank of Japan, Ltd. (Trust Account)

5,939,400

4.63

STATE STREET BANK AND TRUST COMPANY 505001

2,252,200

1.76

Hiroshi Shimizu

2,000,000

1.56

STATE STREET BANK AND TRUST COMPANY 505019

1,961,300

1.53

J.P. MORGAN BANK LUXEMBOURG S.A. 381572

1,771,200

1.38

The Master Trust Bank of Japan, Ltd.
(officer remuneration BIP trust account 76034)

1,739,200

1.36

Name

64

Please refer to the following forthe latest status of shares.

Number of shares authorized

Number of shares issued

Company
Overview

Sustainability(Note 1) The above shareholding ratio is calculated by excluding treasury stock (10,724,240 shares).
(Note 2) The number of treasury stock does not include the shares (1,739,200 shares) held by the Executive Compensation
BIP (Board Incentive Plan) Trust.

Sep. 2017

Sep. 2018

Sep. 2019

Sep. 2020

Sep. 2021

Sep. 2018

Sep. 2019

Sep. 2020

Sep. 2021

Trading Volume(Thousands of shares)
100,000

80,00060,00040,00020,0000

Sep. 20170

SEPTENI HOLDINGS CO., LTD.
https://www.septeni-holdings.co.jp/en/
Company names and services in this report are trademarks orregistered trademarks of the respective companies.