Dentsu Group Inc.

Integrated Report 2024

Contents

Corporate Philosophy

Value Creation Story

Management Strategy

Data

Chapter 1

Chapter 2

Chapter 3

Our purpose as a company, and thesociety we aim to achieve

Creating value from both the financial
and non-financial perspectives

Strategies and initiatives to enhance
corporate value

Corporate Philosophy

Our corporate philosophy
at dentsu
Corporate DNA

03

Purpose05

Why/What/How

06

Values—The 8 Ways

07

The future we want to achieve
Vision08

Management policy09

CEO message

10

Realizing a vibrant society where
people enjoy a fulfilling life

Value Creation Story

Value creation of dentsu
Value Creation ModelManagement Strategy

Strategy overview
13

Management focus

Data

Related data
30

Financial data

92

Non-financial data

94

Subsidiaries and affiliates

96

Changes in our external
environment and Materiality

Strategies and initiatives

Analysis of theexternal environment

15

Information for shareholders / 97
Share information

Materiality

16

Transforming ourselves in line with theaccelerating changes in our businessenvironment

Our people

Editorial policy for this report

Financial
17

Enhancing corporate value throughfinancial and non-financial means:
Building a foundation to support our
return to growth

22

Generating ideas for the future tosolve challenges facing society

Human rights

58

Promoting and respecting humanrights as a core business strategy

Environment and society

Governance
Enhancing corporate value throughbetter corporate governance2030 Sustainability Strategy 23

Our 2023 results

Note: Where “dentsu” is written on its own, this basically refers to the entire Dentsu Group.

47

59

Working to realize a low-carbon society
and make social contributions toward
truly sustainable corporate growth

Non-ﬁnancial

Financial andnon-financial highlights

31

Aspiring to win as a people-centeredcompany

CFO message

CSusO message

Our business

26

65

Editorial policy98

Contents

Corporate Philosophy

Value Creation Story

Management Strategy

Data

Corporate DNA
PurposeWhy/What/How
ValuesVisionManagement policy
CEO message

Chapter 1

Corporate Philosophy

Our purpose as a company, and the society we aim to achieve

Contents

Corporate Philosophy

Value Creation Story

Management Strategy

Data

Corporate DNA
The DNA of dentsu: striving to create and develop a vibrant society for the future
Creating the never before to help shape society
Founded by Hoshio Mitsunaga in 1901, advertising sales
and telecommunications were launched as a set, andserved as a core business model to disseminate highquality news articles in rural areas and raise generalawareness among the Japanese populace.
In 1936, the company was forced by government
policy to let go of its telecommunications business, andrelaunched as a company dedicated to advertising.
However, the relationship with media companies and thedesire to serve society were passed down throughgenerations of employees, resulting in the distinctive
Group business model that is now in place.

Hoshio Mitsunaga
Founder

Diversified business model with the spread of new media
The fourth president, Hideo Yoshida, built the foundation
for the development and improvement of the advertisingindustry as well as the then-new broadcasting media.
Commercial radio and then television broadcasting
had been launched in 1951 and 1953, one after the other,and quickly they became popular in households. A new
lifestyle, in which broadcast content could be enjoyed ineveryday life, spread throughout Japan.
Dentsu also developed with the spread of the new
media, becoming involved in a range of businesses: world
expos, sports, entertainment, and theme parks. Its
efforts to contribute to the development of a richer
society became part of dentsu’s DNA.

Hideo Yoshida
Fourth president

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

Corporate DNA

123 years aspiring towards andbuilding “a vibrant society where people enjoy a fulfilling life”
Communications

Innovative technologies
In 1926, dentsu established an
Aviation Department to create asystem for transporting photos, etc.
from news coverage sites.
Then in 1928, we were one of the firstcompanies in Japan to acquire newelectronic photo transmission
technology developed in Germany,placing us in a leading position
among our competitors.

Advertising

Advancing Japan’s
advertising industry
After WWII, dentsu raised the profile ofadvertising by making newspaper
circulation figures public. We alsoestablished the Dentsu AdvertisingAward to promote commercial
broadcasting and introduced
marketing to Japan’s advertisingindustry. Through efforts such as these,
we worked to incorporate fairness,
culture, and science into the advertisingindustry to develop it as a whole.

1901 Hoshio Mitsunaga establishes Japan Advertising Ltd. (July) andTelegraphic Service Co. (November).
1936 The Company relinquishes its news services department and relaunches
itself as a specialized advertising agency.
1946 First issue of “Dentsu-ho.”
1947 Hideo Yoshida, the “father of Japanese advertising,” becomes dentsu’s
fourth President / Dentsu Advertising Awards established.
1949 Creation of the Dentsu Advertising Essay Contest for Students.
1950 Establishment of the Advertising Merit Award.
1951 Contributing to the launch of commercial radio broadcasting in Japan.
1953 Contributing to the launch of commercial television broadcastingin Japan.
1955 Company name changed to Dentsu Advertising Ltd. / Establishment of
the Newspaper Merit Award.
1956 First introduction of marketing in the Japanese advertising industry.
1961 Announcement of the Dentsu International Vision.
1964 Support for the Tokyo Olympic Games.
1970 Support for the Japan World Expo (Osaka).
1971 Establishment of the Broadcasting Merit Award.

Events/Sports

Expanding the horizons of thecommunication business
Leveraging the know-how
accumulated during preparations for,and operation of, the Japan World
Exposition Osaka 1970, we were able
to connect content, companies, andconsumers to expand our corporateclient services in areas including
sports, events, and PR.

Entertainment/Content
Content-driven marketing
In the 1980s, dentsu began providing
content-based solutions for new fields
such as theme parks, showrooms,
and commercial facilities. In the
1990s, we expanded into producing
content, including movies andanimation.
Such legacies have been carried overin the creation of new consumer
culture and digital content marketing.

1974 Dentsu Advertising Ltd. posts the world’s highest sales for 1973.
1978 Dentsu Advertising Ltd. transitions to a communications company;changes name to Dentsu Inc.
1980 Dentsu becomes the first foreign advertising agency to enter China.
1981 Dentsu forms an alliance with Young & Rubicam, the largest advertising
agency in the US.
1986 Dentsu adopts the corporate philosophy to provide“Total Communications Service.”
1996 Dentsu establishes Japan’s first online advertising agency.
2001 Dentsu celebrates 100th year; makes an IPO on the First Section of theTokyo Stock Exchange; supports production of the animated film
Spirited Away.
2002 Dentsu constructs and moves to new head office; enters alliance with
Publicis Groupe; supports the hosting of the 2002 Japan-Korea FIFA
World Cup.
2003 Dentsu supports the launch of terrestrial digital broadcasting in Japan.
2004 Dentsu launches environmental initiatives.
2005 Dentsu supports the hosting of Expo 2005 in Aichi, Japan.
2008 Dentsu Acquired “Eco-First” company certification.

B2B2S

Solving social issues from a
global perspective
Since its founding, dentsu has
provided solutions to improve society
from a consumer perspective. Amid a
rapidly changing external
environment, businesses and society
face many challenges that call for
global collaboration. We are making
bold efforts to solve these issues bybuilding systems and infrastructure assustainable growth partners.

2009 Dentsu adopts new corporate philosophy of “Good Innovation.”;expands into fields such as content streaming, IT solutions, andsmart grids.
2013 Dentsu acquires Aegis Group plc and establishes Dentsu Aegis Network
Ltd. in the UK.
2013 Dentsu Group Code of Conduct established. Capital increased toc.74.7 billion yen.
2015 Dentsu changes fiscal year end to December 31st; applies IFRS fromfiscal year ending March 2015.
2016 Dentsu Digital Holdings Inc. established.
2020 Dentsu transitions to a new holding company structure.
2021 Dentsu supports the hosting of the 2020 Tokyo Olympic and Paralympic
Games; establishes Group-wide purpose, “an invitation to the neverbefore,” and values.
2023 Dentsu establishes its Group-wide vision and transitions to One dentsu
One Management Team structure.
2024 Dentsu adopts the One dentsu Operating Model as a common business
management model globally.

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Value Creation Story

Management Strategy

Data

Purposean invitation
to thenever before.
Through connecting diverse talents within and beyond our organization,
we exist to create new solutions and new beginnings for the sustainable
development of our clients and society.

Hiroshi Igarashi
Director, Representative Executive Officer,
President & Global CEO, Dentsu Group Inc.

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Why/What/HowWhy

For lasting good

We exist to create truly sustainable value for the organizations
we work with and in the lives of millions.
What

The power of the never before
Our ideas create new solutions and new beginnings foran ever-changing business environment.

How

Open teaming

Anyone from anywhere in the dentsu world and beyond
can get together in a team, there are no boundaries.

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Value Creation Story

Management Strategy

Data

Values—The 8 Ways

Not just in the work we do, but as individuals, we approach life with a higher perspective and act with integrity, always.
It is in this spirit we share the 8 ways.

1 WE DREAM LOUD
2 WE INSPIRE CHANGE
3 WE TEAM WITHOUT LIMITS
4 WE ALL LEAD
5 WE MAKE IT REAL
6 WE CLIMB HIGH
7 WE CHOOSE EXCITEMENT
8 WE ARE A FORCE FOR GOOD

We rise to the ever-evolving needs of our clients and partners by dreaming big andloud. We take businesses to unexplored territory and everyone of us is invited to join.
Thinking small is for other people. Let’s celebrate audacity.
Change is our path through the impossible. Change is where the magic happens.
Change knows the present is already the past. Change never gets old. Change is theadventure we love. Let’s be fearless about change.

All our diverse and talented people around the world are able to come together in any
formation. All our doors are open to innovation from anyone, anywhere. We’rebuilding the new by connecting the diﬀerent. Let’s unleash the “power of us.”

We believe that leadership is what we do together. It ﬂows through all of us. Anyone indentsu can lead us towards the never before. Anyone can help us. Anyone caninﬂuence the outcome. Let’s lead together, be strong together—and show the world.

We’re more than idealists, we’re entrepreneurs. We turn strategic vision intomeasurable plans, executed beautifully. What we dream, we build. It’s not genius until
it’s real. Let’s make it happen.

What we do isn’t always easy. But even when a task seems impossible, we meet it withgrace and optimism. We step towards diﬃculties and turn problems into progress.
We’re here to ﬁnd solutions. Let’s welcome challenges.
On every project we look for ways to go further, to make our work more interesting
and rewarding. In choosing our way, we take the exciting path, because in tough times
and good, it’s excitement that propels business forward. Let’s love the work we do.
We work with honesty, integrity and responsibility. We are endlessly curious about
ways to add value to people’s lives. When we do the right thing as individuals, it
becomes who we are as a company. Let’s use our powers for the good of everyone.

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Value Creation Story

Management Strategy

Data

VisionTo be at the forefront ofpeople-centered transformations
that shape society

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Corporate Philosophy

Value Creation Story

Management Strategy

DataManagement policy

B2B2S

Resolving social issues
together with clients, andachieving sustainable growth for all

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Value Creation Story

Management Strategy

Data

CEO message
Realizing a vibrant society where people enjoy a fulfilling life
Looking back at our 2023 results
Although 2023 was a challenging year due to the
combined effects of internal and external factors, there
have been bright spots even amid these circumstances.
For example, we are beginning to see signs of a recovery
in spending among our clients in the technology sector,
and the macro environment is gradually improving. In
addition, we are steadily gaining recognition forproviding our clients with Integrated Growth Solutions inhigh-growth areas at the convergence of marketing,technology, and consulting that integrate the diverse
capabilities of the entire Group. This is demonstrated
through our focus on Customer Transformation &Technology (CT&T), which has grown from 15% of theGroup’s net revenue in 2016 to account for 30% in 2023,
with Japan in particular recording double-digit growth in
this field.
In 2024, we will continue to build momentum in our
provision of Integrated Growth Solutions to clients as
One dentsu to put us back on a growth trajectory.

A shift from external investment tointernal growth: our initiatives in 2024
To swiftly recover our business performance, we areaccelerating a shift in management resources from afocus on growth based on external investment toward a
return to organic growth and strengthening internal
investment. Specifically, we will further grow our data
and technology capabilities, including AI, which enable
us to provide highly accountable solutions, in attracting
and developing talent who will develop and deliverindustry-leading Integrated Growth Solutions to ourclients, and in our business operations and enterpriseplatforms to continue to drive simplicity and efficiency inour business.
Moreover, we are refining our focus on specificbusiness areas and markets to pursue our business strategy,
restructuring, and reviewing unprofitable businesses andmarkets. To ensure financial discipline in carrying out
transformation of our business portfolio and achieving
sustainable business growth, we have established the
Finance Committee this year, consisting of outside
directors, as an advisory body to the Board of Directors.
We are also working to make further progress in ourgovernance and internal controls, the effectiveness ofwhich has been improved in recent years. The Group has
established the dentsu Japan Reform Committee, of
which I serve as Chair, and we are working hard towards

Mindset and Behavior Reform with the aim of “fulfilling
our responsibility to all stakeholders by renewing theway we approach our work.” By adapting our systems inthis way and disseminating our Code of Conduct
throughout the entire Group, we aim to establish anorganizational culture that prioritizes integrity.

Dentsu’s value creation in a period ofsignificant change
Our external operating environment is undergoingsignificant changes at an unprecedented speed. The
business environment continues to evolve as technology
advances at pace, and our world faces major social,political, and ecological challenges that we will all needto come together to urgently address. To realize asustainable society, we must shape a new and exciting
future that is not simply an extension of the past.
As a Business-to-Business-to-Society (B2B2S)
company, dentsu seeks to generate both economic andsocial value. Our Value Creation Model represents how
we leverage our own strengths while collaborating withour clients and partners to create value and realize abetter society. Going forward, I believe that our
corporate value creation should focus on both financial
and non-financial performance, with human capital as
one prominent example. From this perspective, dentsu
has set out five material issues* on which to focus, and10

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Management Strategy

Data

CEO message

we have commenced initiatives around these on aGroup-wide basis.
This year marks the formulation of and start ofactivities around our updated 2030 Sustainability
Strategy, a medium- to long-term corporate strategy
that considers the environmental, social, and economic
impacts of dentsu’s business activities. Our business andsustainability strategies are interconnected as a unified
path to long-term and sustainable growth.
I am confident that implementing these strategies
as One dentsu are our route to success for our clients.

By leveraging the creativity and execution abilities ofeach of our global talent to create innovation, we canachieve our vision to be at the forefront of peoplecentered transformations that shape society. This is the
future of dentsu.
Together with our clients and other stakeholders,we aim to realize a vibrant society where people enjoy afulfilling life.

* Our five Material Issues are detailed in Chapter 2.

The unique strengths of dentsu.
The ability of our diverse talent toimagine and shape the future
Since our founding, dentsu has recognized our people as
our greatest assets. We believe that our diverse andtalented teams around the world - with their client
focus, creativity, innovation, and execution ability - arethe true drivers of our corporate value.
Our talent find motivation in creating a better
society that is one step ahead, which I think is in dentsu’sDNA. We also have our “insights into people” that wehave cultivated by continuously observing people andsociety throughout our 123-year history.

Hiroshi Igarashi
Director, Representative Executive Officer,
President & Global CEO, dentsu

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

Value Creation Model
Analysis of the external environment
Materiality
CFO message
CSusO message
2030 Sustainability Strategy
Financial and non-financial highlights

Chapter 2

Value Creation Story
Creating value from both the financial andnon-financial perspectives

Contents

Corporate Philosophy

Value Creation Story

Management Strategy

Data

Value Creation Model
Dentsu is a creative organization that generates new ideas and values. By leveraging unprecedented methods and the power of people, we bring about transformations and move society in apositive direction.
As we seek to transition to a sustainable society, we must redefine the meaning of prosperity for people and help shape people’s attitudes and behaviors.
The dentsu Value Creation Model is designed to illustrate the value we create to realize these transformations.
Purposean invitation to the never before.

VisionTo be at the forefront of people-centered transformations that shape society.

Input

OutcomeIntellectual Capital
Deep people insights andadvanced data &technology

Social Capital

Financial Capital

Strong trust-based
relationships with clientsand business partners

Sustainable profitability
and a sound, stablefinancial baseBusiness
Technology

MarketingTransformative Creativity
Consumer Intelligence
Integrity
Corporate Governance2030 Sustainability Strategy

B2B2S

Resolving social issues together with clients,
and achieving sustainable growth for all

Economic Value

Social Value

Supporting our clients’business transformation forsustainable growth

Taking a people-centeredapproach to achieve scalable
impact for society

OutputConsulting

Integrated Growth Solutions
Solutions that go beyond the realm of marketing andintegrate the diverse capabilities of our Group to achieve
topline growth for our clients.

To inspire people everywhere
towards a new way of living

Human Capital
Talent who possess expertise andcreativity, and programs to unleash
their potential

ImpactThe society that dentsu aims to achieve

A vibrant society
where people enjoya fulfilling life

One dentsu Operating Model

Generating ideas for the future to solve challenges facing society

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Value Creation Model

Understanding dentsu’s people-centered Value Creation Model
Our people are the driving force behind our value creation, forming the core of dentsu
for 123 years. We truly believe in the unlimited possibilities that arise when people
connect with each other.

Point 1

The creativity we generate, backed by consumer intelligence, is our mostsignificant capability. When a wide range of people are involved, creativity flourishes, resulting
in unprecedented ideas and solutions. We create new value by collaborating with all
stakeholders, both within and outside the Group.

Point 2

Corporate governance represents the guiding principle of our business activities,

with integrity as a core value. To solve challenging social issues as well as the increasingly
complex issues of our clients, we have integrated the areas of marketing, consulting, andtechnology. At the same time, we support sustainable growth and promote transformation

Point 1-3

throughout society.
We plan to lead new markets by applying Integrated Growth Solutions that are supported

an invitation to the never before.

Purposeby the One dentsu Operating Model.

To be at the forefront of people-centered transformations that shape society.

VisionInput

OutcomeIntellectual Capital

Talent who possess expertise andcreativity, and programs to unleash
their potential

Deep people insights andadvanced data &technology

Social Capital

Financial Capital

Strong trust-based
relationships with clientsand business partners

Sustainable profitability
and a sound, stablefinancial baseBusiness
Technology

MarketingTransformative Creativity
Consumer Intelligence
Integrity
Corporate Governance2030 Sustainability Strategy

ImpactResolving social issues together with clients,
and achieving sustainable growth for all

Economic Value

Social Value

Supporting our clients’business transformation forsustainable growth

Taking a people-centeredapproach to achieve scalable
impact for society

OutputConsulting

Point 3

B2B2S

Integrated Growth Solutions
Solutions that go beyond the realm of marketing andintegrate the diverse capabilities of our Group to achieve
topline growth for our clients.

One dentsu Operating Model

Generating ideas for the future to solve challenges facing society

Point 4To inspire people everywhere
towards a new way of living

Human Capital

Our Value Creation Model enables our people to develop their potential. People

grow through their work and, in the process, enrich their human, social, and intellectual capital.
The society that dentsu aims to achieve

A vibrant society
where people enjoya fulfilling life

By augmenting these three forms of capital with financial capital, we create social andeconomic value, and continue to enhance our corporate value as a B2B2S company.
We expect these value creation activities to help transform people’s attitudes andbehaviors, and to realize a vibrant society where people enjoy a fulfilling life.

Point 4

Our 2030 Sustainability Strategy—based on our purpose, vision, andmanagement policy—is designed to result in medium- to long-term value creation. This will
strengthen the Group’s foundations of human, social, and intellectual capital throughinitiatives in non-financial areas.

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Analysis of the external environment
Changing societal and consumer needs●Gen Z is increasingly calling for social change●There is a shift away from mass consumption to new
consumption values, as corporate responses to issues such as
the environment and human rights are having a major impact
on brands and consumer preferences●Social inequalities are widening, as social divisions—including
the rise of nationalism and generation gaps—escalate globally●As the world population increases, there is growing concern
regarding demand outstripping available resources, the effects
of aging societies and declining birthrates in developed
countries, and existing institutional structures●Geopolitical tensions are rising as wars and conflicts continue●There is a growing need for corporate DEI and respect forhuman rights

Changing business assumptions and challenges

People and society

Business

Technological possibilities

Global environmental risks facing humanity●There is an escalating, urgent need to address climate change
and nature loss
●Global coordination is expanding regarding social issues anddecarbonization, as outlined in the UN SDGs, COPs, andinternational agreements●Voluntary initiatives and mandatory legislation around theenvironment are becoming increasingly stringent●There is a deepening need to enhance adaptability amid arising number of natural disasters globally●We face significant risks in the event of inadequate responses
to environmental issues not only in our own company, but also
our clients and supply chains●Demand is growing for disclosure of non-financial initiatives, businessmodels, and strategies in response to risks and opportunities●Investor interest in ESG, sustainability, and changing global
capital flows continues to rise
●As activism by NGOs and other groups grows, so too does thepressure on the advertising industry—including demands tostop doing business with high-emitting companies●Advertising-related regulations are becoming tighter, as advertising
responsibilities linked to greenwashing and other issues mount●With the end of profit-first ideology, demand for trade-on
business models—that consider the environment and society—are attracting attention, as is the need for new businesses that
promote circular and sharing economies●The complexity of client business issues is increasing, as the
progressively sophisticated media and content areas of theseenterprises expand, in line with the rising importance of
personalized experiences and complex consumer needs

Environment

Technology●The ongoing, rapid development and spread of AI is resulting in
global debate and the introduction of relevant regulations●New social media and digital economic spheres are emerging●The application of big data is expanding●The importance of data security—including personal
information—is increasing●Digitalization in all areas, dissemination of next-generation
communications, and AR/VR technologies are accelerating, assustainable technologies emerge in fields including decarbonization

The business environment surrounding the Group is undergoing a major paradigm shift.
Amid these changes, it is our responsibility to work with clients and other stakeholders in tackling challenging social issues.
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Materiality
Amid an ever-changing external environment, we
continue seeking to both realize our purpose—aninvitation to the never before—and maximize corporate
value for our stakeholders. To this end, we have framed
our Materiality based on the two axes of “importancefrom the management perspective” and “importancefrom the stakeholder perspective.”[Materiality formulation process: website]
Materiality is a key aspect in our interactions with

External environment

Changing societal andconsumer needs
Changing businessassumptions andchallenges
Global environmental
risks facing humanity
Technologicalpossibilities

society, clients, shareholders, investors, partners, talent,
and all other stakeholders. It is also a management issue
that enables the Group to sustainably create value andachieve growth.
[Stakeholder details: website]
For this reason, initiatives around Materiality are deeply
connected to our 2030 Sustainability Strategy.
The following table shows the relationship between
specified material issues and corporate value.

Performance Improvement in the Short Term

Corporate
Value=

Short-term Financial Results

Cost of Capital

Reducing Management Risk

Material issues

Reasons for selection (risks, opportunities)

Business ethics &compliance /Data security

Our corporate activities are predicated on adherence to corporate ethics and compliance, as well as integrity withrespect to society and all other stakeholders. There is a growing demand for respect for human rights, protection ofdata privacy, and cybersecurity. We will fulfill our responsibilities and establish a solid foundation for value creation by
further evolving our corporate governance and risk management.

DEI

By emphasizing Diversity, Equity & Inclusion, we can maximize the potential of our talent and exponentially enhance
our distinctive human capital, thereby energizing the Group and our industry. This leads directly to better solutions forclients and society, while meeting shareholder and investor expectations.

Human capitaldevelopment

As human capital is the core of the Group’s competitiveness, depletion is a major risk. Talent development and thecreation of a positive working environment are essential for enhancing the value we create for clients, shareholders,investors, and society. Developing future generations and partners through our corporate activities will enhance thecreation of talent in our industry and attract highly capable people.

Climate action

Climate change has serious implications for all stakeholders. The Group must address the transition to a decarbonized
and sustainable society if it is to create sustainable value. Proactive efforts will help us to lead industry transformationand create new competitive advantages for us in the marketplace.

Innovation
leadership

Our purpose and vision entail providing unprecedented ideas and solutions for clients and society to produce
transformation. By collaborating with stakeholders, displaying thought leadership throughout our industry and society,and investing in the realization of new ideas, we expect to become a driving force for innovation aimed at solving
challenging social issues.

-

Growth Rate

Mid- to Long-term Value Creation

Relation to corporate value

Reducing Management Risk
Mid- to Long-term Value Creation

Mid- to Long-term Value Creation

Performance Improvement in the Short Term
Reducing Management Risk
Mid- to Long-term Value Creation

Reducing Management Risk
Mid- to Long-term Value Creation

Performance Improvement in the Short Term
Mid- to Long-term Value Creation

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Enhancing corporate value through financial and non-financial means:
Building a foundation to support our return to growth
Introduction
2023 was a challenging year for the Group, with external
factors such as a fast changing business environment
and internal factors such as a complex organizational
structure that impacted both our organic revenue andprofitability. In 2024, we will focus management
resources on returning the Group to growth by removing
barriers to collaboration and strengthening ourcompetitiveness, ensuring a client-centric perspective.
As clients’ needs shift to integrated solutions, we aim tosustainably enhance our corporate value through ourdifferentiated position at the convergence of marketing,technology, and consulting.

Review of FY2023 financial performance

Arinobu Soga
Director, Representative Executive Officer,
Executive Vice President,
Global Chief Governance Officer &Global Chief Financial Officer,
dentsuIn 2023, despite an organic revenue decline of 4.9%, theGroup recorded the highest net revenue figure, with anincrease of 1.6% to 1,129.5 billion yen, boosted by the
positive impact of acquisitions and FX. Underlying
operating profit was 163.5 billion yen, down 20.0% yoy,and underlying net profit decreased 31.3% to 89.8 billion
yen. On a statutory basis, however, we recorded a net lossof 10.7 billion yen, largely due to the 67.8 billion yen of
impairment charges recorded in APAC. As we look ahead,it will be difficult to achieve the commitments regardingorganic growth rate and operating margin made under
the current Medium-Term Management Plan.
Our performance was adversely affected by anumber of issues in 2023. Our media business was
impacted by the well documented slowdown in spending
from technology clients. The Customer Transformation& Technology (CT&T) segment outside of Japan was
impacted by rising interest rates which caused caution
from our clients around large transformation projects.
This caution caused delays and reduction in scope ofexisting projects. Growth was also impacted by areduced client win rate in 2023. To improve win rates, it isessential to strengthen capabilities and drive
collaboration among our teams. In 2024, we arecommitted to remove all barriers to collaboration,
introducing Integrated Client Leads that will support thedelivery of Integrated Growth Solutions (IGS) –integrating all our capabilities across the firm.
Collaboration will also be strengthened through the useof single market P&Ls, aligning incentives to ensure
integration of our services.
In 2023, Japan reported organic growth of 1.6%
with growth led by CT&T, with particular strength from
Business Transformation (BX) and Digital Transformation(DX). Outside of Japan, all regions reported negative
organic growth. Americas reported organic decline of
7.2%, in line with expectations, as continued delays in17

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CT&T projects and reduced media spend from clients
impacted growth. EMEA reported organic decline of
10.9% partly due to the one-off financial impact in the
DACH cluster in the second and third quarter. Excluding
the one-off financial impact, decline in EMEA would
have been 7.6%. APAC (ex Japan) recorded an organic
decline of 8.2% due to delays in client spending andreduced project scope in CT&T.
Our FY2023 operating margin fell 390 bps due tolower than expected revenues, partially offset by costmeasures including reduced spend on travel andentertainment costs. As expected, charges were incurredin the fourth quarter relating to business simplification.
Looking by region, FY2023 operating margin in Japanwas higher than expected due to a reduction in non-staff
expenses and the delay of an IT implementation project
to 2024 also boosted FY2023 margin. The Americasdelivered a 120-bps margin improvement - despite top
line pressure - due to cost management measures
implemented early in the year. The EMEA and APAC
regions both saw margin decline as a result of lower
client spend.

FY2023 highlights: Regional performanceJapan

Organic growth

Proportion of
net revenue

+1.6%
40%

Improved investment in business andshareholder returns under capital
allocation framework
In 2020, the Group launched a comprehensive review ofthe business. One objective of the review was to improvebalance sheet efficiency, this resulted in the sale of ourheadquarters building in Japan, along with a number ofother property assets and the sale of strategic
shareholdings. In FY2023, we sold an additional 17
Our timeline of improving balance sheet efficiency

Americas(7.2)%
29%

EMEA

APAC

(ex Japan)(10.9)% (8.2)%
21%

10%

2020

● Announce review of all

non-trading assets● Sales of strategic

shareholdings

2021

2022

2023

● Sale of HQ building● Sales of strategic

shareholdings● Sale of property assets● Sales of strategic

shareholdings● Sales of strategic

shareholdings

18

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

CFO message

strategic shareholdings with a total value of c. 13 billion
yen. Since 2020 we have sold a total of 44 stakes,
generating 251 billion yen, allowing for both improved
investment in the business and shareholder returns.
At the start of 2022, the Group published a capital
allocation framework which outlines how capital
generated from the comprehensive review will beallocated toward business growth. The framework includes:• Investment in M&A: 250 to 300 billion yen forinvestment in strategic areas• Progressive dividend, reaching 35% payout ratio ofunderlying basic EPS by FY2024• Upper limit of 1.5× Net debt / Underlying EBITDA year
end; indicative medium-term range of 1.0× to 1.5× (nonIFRS 16 basis)

Achievements of acquisitions andinvestments
Since the announcement of this framework, our total
invested capital in two years from FY2022 to FY2023
was approximately 200 billion yen. As result, we havemade 11 acquisitions, welcoming 6,500 new talents to
the Group.
The acquisitions are firmly delivering benefits:bolstering our data and technology capabilities, allowing
for greater client solutions due to expansions of ourcapabilities, new client wins and pitch wins. In addition,
cost synergies are realized due to greater efficiencies inour business operations.
In 2023 we welcomed Shift7, Omega, RCKT, and Tag

Strategic investments to deliver IGS 2022 & 2023

Total spent

200 bnc. JPY

Investment across all 4 regions:
Americas 31%, Japan 29%,
EMEA 28%, APAC 12%

11 completed

Adding6,500

acquisitions newly
consolidated to the Groupnew talents

2 years through the 3 yr M&A
program FY2022:2024

Enhancing specialist skills
across data & technology, commerce,
and transformation

Delivering strategic benefits:
collaborative pitch wins, revenue
synergies & integrated solutions

to the Group. Our most recent acquisition, Tag, wascompleted at the end of the second quarter andsignificantly enhanced the Group’s global digitalproduction capabilities – enhancing our creative offer by
providing high quality content at speed. Furthermore, it
has a scaled personalization engine for optimal customer
experience management, as well as adding power tomedia with Dynamic Content Optimization (DCO). We
consider its capabilities as the “last mile” ensuring dentsu
provides an integrated, full-service offering that isrequired by our global client base. Also, not only does itstrengthen our solution to existing clients, it iscontributing to the success of new client wins.

Improving shareholder returns
Improving shareholder returns remains a key focus for
the Board of Directors and management, as we
recognize the importance of improving our corporate
value from shareholders’ perspective. In 2023 weaccelerated the dividend payout ratio to 35%, reaching
our long held target one year ahead of schedule. The
2023 dividend was 139.5 yen per share.
In addition, a 20 billion yen buyback was announced
in February 2024 – meaning the Group has returned c.
90 billion yen in buybacks and c. 110 billion yen in
dividends, for a total of c. 200 billion yen over the past
three years from FY2021 to FY2023.

19

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Value Creation Story

Management Strategy

Data

CFO message

In 2024, the Group will shift from prioritizing
acquisitions to prioritizing investment in the existing
business. However, our capital allocation framework
remains the same – the targeted leverage range
remains 1.0× to 1.5× net debt / EBITDA. The Group willcontinue to show flexibility with regards to additional
shareholder returns.

Looking ahead
As we look forward to 2024, we see some of theheadwinds we faced in 2023 dissipating. We expect tosee a return to spend from technology clients –particularly in the US market. However, we will balance
this with the cycling out of account losses in H1FY2024.
Our organic growth rate was negative in Q1FY2024,
which was in line with our forecast, but we are expecting
to return to growth in the second half of the year. Ourorganic growth rate for FY2024 is forecast to be around

Shareholder returns
Payout ratio

Annual dividend per share

35.1%

155.25 yen

Dividend

Sharebuyback

30.0%

28.5%

26.0%

32.0%

90 yen95 yen20182019

117.5 yen

35.0%
139.5 yen

139.5 yen

71.25 yen

2020

2021

2022

2023

2024

(Forecast)

FY2019FY2021

FY2022

FY2024

¥

¥

¥

¥

30

bn

Note: Calculated based on the adjusted underlying basic EPS

30

bn

40

bn

20 bn

1% with an operating margin estimated at c. 15%, downfrom 16.1%* on an adjusted basis in FY2023 due tointernal investments to strengthen competitiveness andexpand capabilities to return the Group to growth.
* Operating margin including one-off financial impact was 14.5%.

In 2024 we have announced three areas of focus for ourinternal investment:•B olster and scale data and technology capabilities• Invest in training, retaining, and attracting diverse
talent, corporate culture, and employee engagement•S trengthen business operations & utilize enterpriseplatforms and systems infrastructure
The investment is recognized within our FY2024 margin
guidance and shall be pursued with discipline.
Investment in outer years will be driven by internal
efficiencies such as greater use of technology andautomation. Our continued investment in Dentsu Global
Services, our networked talent hubs, will also support
future margins.

Enhancing corporate value throughfinancial and non-financial means
As the current Medium-Term Management Plan enters its
final year, the Group is formulating its future policy. In
order to achieve sustainable growth, we are reviewing our20

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

CFO message

business portfolio using metrics such as ROIC, reviewing
past investments, considering new investment strategies,
and have begun formulating financial and investment
discipline. In this journey, the Finance Committee, which
is an advisory body to the Board of Directors and consistsof outside directors, will support decision making from afinancial and shareholder perspective. Details will beshared later this year.
As my responsibility lies in governance, not limited
to finance, I emphasize the role that non-financials canalso play in increasing corporate value. Specifically,
contribution of non-financials to “reduction of capitalcost” and “sustainable growth,” both of which enhance
corporate value.
Firstly, as for “reduction of capital cost,” it is said
that firms with higher ESG ratings will have lower capitalcosts over the medium- to long-term. Dentsu is improving
its ESG ratings, including being selected as a componentof the Dow Jones Sustainability World Index for the firsttime in FY2023. We will continue to accelerate ourefforts to prepare for future non-financial risks such asenvironmental and social sustainability issues, andimprovement of corporate governance.
Secondly, as for “sustainable growth,” it is ourpeople that makes this possible. To realize our vision of“people-centered transformations,” it is essential for ourpeople to play an active role, and we will invest morethan ever in our most important asset, our people.

However, the effects of investment in non-financial
areas, including human capital, are not immediate, andthe benefits to the Group will be felt over the coming
months and years. As part of management’s
commitment to strengthening non-financial capital,
employee engagement scores, proportion of female
leaders and greenhouse gas emissions are partiallylinked to executive compensation, and we haveappropriately assigned leaders responsible for eachtheme to ensure Group-wide progress.
In addition, the Group deems it important toFinance Committee

The Group is working to transform its business portfolio
by reviewing and refining the business domains andmarkets that it should focus on. In order to accomplish
this reform and achieve sustainable business growth, theGroup has decided to establish the Finance Committee,
which consists of independent outside directors withexpertise in finance/accounting and legal/complianceas an advisory body to the Board of Directors from theperspective of financial and investment discipline.
The committee will help enhance financial andinvestment discipline through review and scrutiny of thebusiness strategy from a financial point of view, andmonitoring of the implementation of these initiatives, fromthe perspective of improving shareholder value.

disclose our efforts and results in enhancing corporate
value with high transparency. We are expanding ourdisclosure of both financial and non-financial
information by publishing our ESG Data Book andholding ESG briefings for our shareholders. We consider
the comments we receive in dialogues with our
stakeholders as our “room for growth.” I will fulfill my
responsibilities as to win the trust of our stakeholders
and their expectations for our medium- to long-term
growth by continuing to firmly address our challenges.

Chair: Keiichi Sagawa, independent outside director.
Members: Yuka Matsuda and Andrew House,
independent outside directors.
Main agenda items- Review of M&A, new business, and focused theme
initiatives- Consideration of business portfolio from a financial
perspective, with greater awareness of balance sheetsoundness and capital efficiency- Consideration of listed subsidiary and minority
investment policy- Consideration of investment and capital allocation
policies

21

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

CSusO message
Generating ideas for the future to solve challenges facing society
For dentsu to truly contribute to the growth of our clientsand society into the future, initiatives towards generating
non-financial value are of the utmost importance.
Our 2030 Sustainability Strategy is all about
generating ideas for the future to solve challenges
facing society. It is not simply about being sustainable.
It is about unlocking potential opportunities.
To accomplish this, we must first picture an ideal future
without being bound by current restraints. This allows us
to think freely about how we can achieve that future,
rather than thinking about it as an extension of the past.
By leveraging our “insights into humanity” that we havecultivated since our founding to help shape people’s
attitudes and behaviors, we believe we can contributetowards promoting sustainability for society as a whole.

Yuko Kitakaze
Global Chief Sustainability Officer, dentsu

Furthermore, it is important for us to share with our
stakeholders the value of not simply focusing on our own
short-term profits, but also on medium- to long-termsustainability for society. For example, in October 2023,
dentsu launched the Decarbonization Initiative forMarketing with the goal of visualizing and reducing
greenhouse gas emissions in supply chains associatedwith marketing communication activities in Japan.
Together with the stakeholders involved, we aim to
discuss the optimal state for the industry towards
realizing a low-carbon society.

Collaboration between business, government and civilsociety is key for generating value for society. Connecting
these three groups also happens to be one of dentsu’s
greatest strengths. Through connecting others andleveraging the creativity and ingenuity of our diverse
global talent, we can lead systemic change towards
future possibilities through the following five actions:• Accelerating our own sustainable transformation• Driving change in our industry• Engaging in cross-industry partnerships• Enabling society to make sustainable choices• Advocating for change in social systems
With a spirit of “creating a shared future together withothers,” we will transform society through our
corporate activities.

22

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

2030 Sustainability Strategy
Global pressures such as climate change, nature loss, inequaility, and conflict are increasingly causing widespread disruption. This can only be overcome with a radical transformationof the way we do business and a reshaping of our daily lives.
Amid this major transition, by generating ideas for the future to solve challenges facing society, we will realize a vibrant society where people enjoy a fulfilling life.
Our core themes are People, Planet, and Innovation.
To maximize our individual strengths while helping to achieve sustainability for the planet and society, we plan to develop new ideas and solutions, and lead innovation.
By combining our strengths as One dentsu, we are confident that we will be able to open new avenues of success for our clients and contribute to positive outcomes for the global
environment and society.

an invitation to the never before.

PurposeThrough connecting diverse talents within and beyond our organization,
we exist to create new solutions and new beginnings for the sustainable development of our clients and society.

VisionTo be at the forefront of people-centered transformations that shape society

Society that dentsu aims to achieve

A vibrant society where people enjoy a fulfilling life

Management policy

B2B2S Resolving social issues together with clients, and achieving sustainable growth for all

2030 Sustainability Strategy

Generating ideas for the future to solve challenges facing societyCore themes

Material issues

PEOPLE

PLANETINNOVATION

Unleashing our full potential

Achieving a sustainable future for all

Creating new ideas and solutions

1

Business ethics & compliance / Data security

2

DEI

3

Human capital development

4

Climate action

5

Innovation leadership23

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

2030 Sustainability Strategy

2030 Sustainability Strategy | Action Plans
Material issues

Business ethics

1 & compliance /Data security

PEOPLE

PLANETINNOVATION

Headline goals

Putting integrity
first

2 DEI

Transforming
business andsociety by winning
as One Team

Human capital3
development

Unleashing thebrilliant potentialof our people

4 Climate action

5

Innovation
leadership

Action plans & KPIs

•Embed a philosophy and culture that places integrity first•Reinforce the three-line defense function•Enhance the effectiveness of the supervisory function by the Board of Directors•Individual measures to be promoted under each theme-E stablish a common training environment (KPI: 100% employees receive training), develop skills for
key contact points (KPI: contact points and experts established for issue areas), conduct stakeholder
dialogue and information disclosure (KPI: acquire certification and improve ratings)

Relation to corporate value Related SDGs

Reducing Management Risk
Mid- to Long-term Value Creation

See p. 65•Win as One Team•- Female leaders to reach an aspirational goal of 45% by 2030
-C
 reate an inclusive environment that is accessible to all, resulting in an increase of the number ofcolleagues with a disability working at dentsu
Foster a corporate culture that embraces diversity- An aspirational goal of achieving a two-point increase in Check In (CI) survey “Respect” score by 2025

•Strengthen investment in human capital- Increase leadership level training (KPIs: GMT succession readiness rate, talent discussion time)- Offer growth opportunities (training, strategic HR transfers) (KPI: CI survey score)- Talent development in strategic areas (capability training)
Improve employee engagement score (activities by region) (KPI: CI survey score)

Accelerating the
low-carbon
transition••Achieve net-zero greenhouse gas (GHG) emissions by 2040 (Scope 1-3)
•Achieve a 46.2% absolute reduction in GHG emissions by 2030 (Scope 1-3) compared to a 2019 baseline•Achieve 100% renewable energy* by 2030
•Enable one billion people to make more sustainable choices by 2030

Creating ideas forthe future with thepower of creativity
and technology•Promote investments and R&D for future innovation (KPI: case numbers)•Generate SDGs-related thought-leadership and proposals with a clear call-to-action(KPI: number of research projects)•Create social value through partnerships and ecosystems (KPI: number of ecosystems)* Renewable energy in the context of dentsu’s sustainability strategy and commitments refers to electricity generated fromrenewable sources. This definition aligns with RE100.

Mid- to Long-term Value Creation

See p. 53

Performance Improvementin the Short Term
Reducing Management Risk
Mid- to Long-term Value Creation

See p. 47

Reducing Management Risk
Mid- to Long-term Value Creation

See p. 59

Performance Improvementin the Short Term
Mid- to Long-term Value Creation

See p. 31

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

2030 Sustainability Strategy

2030 Sustainability Strategy | Governance

Chair:

Group Sustainability Committee (GSC)• Progress towards the 2030 Sustainability Strategy and the status of the initiatives across five areas will be
managed through quarterly GSC meetings.
• GSC committee members, each Materiality Sponsor, and the relevant department in charge will collaborate toensure that all initiatives are achieved.
Yuko Kitakaze (Global Chief Sustainability Officer)

Members: Hiroshi Igarashi (President & Global CEO), Arinobu Soga (Global Chief Governance Officer, Global Chief
Financial Officer), Alison Zoellner (Global General Counsel), Jean Lin (Global President - Global Practices),
Jeremy Miller (Global Chief Communications Officer), Manus Wheeler (Chief Brand & Culture Officer, Deputy
Chief of Staff), Miho Tanimoto (Global Chief HR Officer)

Material Issue

1 Business ethics & compliance / Data security

PEOPLE

SponsorArinobu Soga
Global Chief Governance Officer
Global Chief Financial Officer

Department in ChargeGroup Governance Unit

2 DEI
Miho Tanimoto
Global Chief HR Officer

Group HR Office

3 Human capital development

PLANETINNOVATION

Four Regions

AMERICAS
EMEA
APAC

4 Climate action

Yuko Kitakaze

5 Innovation leadershipJean Lin

Global Chief Sustainability Officer

Global President – Global Practices

JAPANGroup Sustainability Office

Global Practices Team25

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Value Creation Story

Management Strategy

Data

Financial highlights
Net revenue(Billions of yen)
1,200

1,144.8

Profit (loss) for the year attributableto owners of the parent

Underlying operating profit*1

Underlying net profit(attributable to owners of the parent)*2(Billions of yen)(Billions of yen)
250

(Billions of yen)
150

200

200

100

800

150

0
-10.7

400

-100
-200

0

2016 2017 2018 2019 2020 2021 2022 2023

120

163.5

100

60

50

30

0

2016 2017 2018 2019 2020 2021 2022 2023

89.8

90

0

2016 2017 2018 2019 2020 2021 2022 2023

2016 2017 2018 2019 2020 2021 2022 2023

Organic growth rate*3

CT&T*4 ratio

Operating margin*5

Cash dividend per share /Underlying dividend payout ratio*6

(%)

(%)

(%)

(yen)

20

40

40

160

30

120

139.50 30

20

20

80

20

10

10

40

10

15

30

10

5
0
-5
-10

31.9

-4.9

0

-15

2016 2017 2018 2019 2020 2021 2022 2023

Cash dividend per share

14.5

0

2020

2021

2022

2023

*1 KPI to measure recurring business performance which is calculated as operating profit added with M&A related
items and one-off items
M&A related items: amortization of purchased intangible assets, acquisition costs, share-based compensation
expenses related to acquired companies, share-based compensation expense issued following the acquisition of
100% ownership of a subsidiary. One-off items: items such as business transformation cost, impairment loss andgain/loss on sales of non-current assets*2 Underlying net profit (attributable to owners of the parent): KPI to measure recurring net profit attributable toowners of the parent which is calculated as net profit (attributable to owners of the parent) added with adjustment
items related to operating profit, revaluation of earnout liabilities/M&A related put-option liabilities, gain/loss on

Underlying dividend payout ratio

(%)

35.0

0

2016 2017 2018 2019 2020 2021 2022 2023

40

02016 2017 2018 2019 2020 2021 2022 2023

sales of shares of associates, tax-related and NCI profit-related and other one-off items*3 Organic growth rate represents the constant currency year-on-year growth after adjusting for the effect ofbusiness acquired or disposed of since the beginning of the previous year
*4 CT&T = Customer Transformation & Technology : new business domain including the services related to marketing
technology, customer experience management, commerce, system integration, and transformation & growth strategy*5 Operating margin = Underlying operating profit ÷ Net revenue x 100*6 Underlying dividend payout ratio = Cash dividend per share ÷ Basic underlying profit per share x 100

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Value Creation Story

Management Strategy

Data

Non-financial highlights
GHG emissions
GHG emissions (Scope 1+2)

GHG emissions (Scope 1+2+3)(tCO2e)Renewable energy usage
Renewable energy rate

Total electricity consumption(kWh)100,000,000

500,000

440,911400,000

60,000,000

200,000

40,000,000

100,000

20,000,000

18,261

0

2021

2022

(%)

55.3

60

40

65,485,764(DJSI World). Included for the eighth timein the DJSI Asia Pacific Index.

20

36,207,570
0

0

2023

Included for the first time as a member ofthe Dow Jones Sustainability World Index

80,000,000

300,000

2019*1

External evaluation of sustainability and ESG initiatives

Renewable energy rate

2021

2022

2023

Also continued to be selected as a
Percentage of female leaders*2
Percentage of female leaders

(%)

40

30

constituent of FTSE4Good and FTSE

Employee engagement score

Blossom Japan.

Employee engagement score

(pt)

100

32.4

80

66

60
20

Awarded a Bronze Medal by Ecovadis for

40
10

sustainability performance, including inthe supply chain.

20
0

0

2023

2021

2022

2023

*1 The 2019 baseline figures are as of December 31, 2023. We submitted new GHG reduction targets to the
Science-Based Targets initiative (SBTi) in 2024.
*2 For details, please see the Independent Assurance Report:
https://www.group.dentsu.com/en/sustainability/common/pdf/third-party-assurance.pdf

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Value Creation Story

Management Strategy

Data

Non-financial highlights

Recognitions for creating an environment where our diverse talent can thrive
Received the highest rating of Gold for the second
consecutive year, and Rainbow certification in the workwith Pride LGBTQ+ corporate initiatives index.
Recognized for the second consecutive year with 4.5 stars
by Nikkei Smart Work as an advanced company taking on
the challenge of a productivity revolution throughworkstyle reforms, with an S+ rank or higher in the Human
Resource Utilization Capabilities, Innovation Capabilities,
and Market Development Capabilities categories.

Received the highest three-star Eruboshi certificationfrom Japan’s Ministry of Health, Labour and Welfare(MHLW) as a company promoting women’s participation
and advancement. Received Kurumin certification fromMHLW as a company offering good child-rearing support,
based on the Act on Advancement of Measures to Support
the Development of the Next Generation.
Notes: 1. Dentsu Kyushu, Dentsu PR Consulting, Carta Holdings, Dentsu Ad-Gear, Dentsu East Japan,
Ignition Point, Dentsu Digital, and Dentsu Science Jam received Eruboshi certification.
Notes: 2. Dentsu Digital received Kurumin certification.

Dentsu Inc. placed a record-high third in the Best
Companies to Work for 2024 ranking announced by
Japan’s OpenWork, Inc., which operates the OpenWork
information platform for career change and employment(out of 1,388 companies included in the ranking).
Dentsu Soken Inc. (second consecutive year) and Ignition
Point Inc. (eighth consecutive year) were selected as
Best Workplaces in the 2024 Best Companies to Work inthe survey conducted by the Great Place To Work®
Institute Japan.

Note: Where the company name is not specified, the award/recognition was received by Dentsu Group Inc.

Recognitions for our creativity and innovation capabilities
Awarded Regional Network of the Year 2023, APAC, forthe second year in a row at Cannes Lions, the world’s
largest creative festival. Dentsu Inc. won Agency of theYear—Craft, as well as the Grand Prix in the Industry
Craft Lions category. Dentsu Creative won the Grand Prixin the Pharma category. A total of 29 individual awards
were received.

Named Network of the Year as the most creative network
at Spikes Asia 2024, APAC’s most prestigious advertisingaward ceremony (second award, first in three years).
Dentsu Inc. won the Asia-Pacific Agency of the Year award
as the most creative single agency (third award, first inseven years). A total of 35 individual awards were received.

Named Network of the Year as the most creative network
at ADFEST 2024, Asia’s leading creative festival (eighthaward, third consecutive year).
Dentsu Inc. was named Agency of the Year as the mostcreative single agency (10th award, second consecutiveyear), as well as Digital Agency of the Year and East
Asia Agency of the Year. A total of 27 individual awards
were received.

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Corporate Philosophy

Value Creation Story

Management Strategy

DataManagement focus
Our business
Our people
Human rights
Environment and society
Governance

Chapter 3

Management Strategy
Strategies and initiatives to enhance corporate value

Contents

Corporate Philosophy

Value Creation Story

Management Strategy

DataManagement focus
In Chapter 3, we explain our strategies and initiatives to enhance the corporate value of dentsu.

Our businessTransforming ourselves in linewith the accelerating changes
in our business environment

Aspiring to win as a peoplecentered company
Three pillars of our HR strategy
1. People growth- Risks and impacts

3. HR service excellence- Our most salient impacts

Four pillars of our DEI strategy

Initiative 2: Integration of Tag

1. Transparency and accountability
2. Representation and sponsorship
3. Education and continuous learning

B2B2S solutions provided by dentsu(case studies)- Human Rights Policy

2. Winning as One Team

Initiative 1: Strengthening BXTransformative creativity:
linking Group talent to change
society

Promoting and respecting
human rights as a corebusiness strategy- GovernanceAccelerating and deepening our IGS

Initiative 3: One dentsu, powered by AI

Human rights /Environment and society

4. Impact on clients and communities

Working to realize a low-carbon
society and make social
contributions toward truly
sustainable corporate growth- Climate action- Nature-related initiatives- Learning and development- Initiatives towards industrial
transformation throughpartnerships

Our human capital-related progress
indicators- Strategic collaboration withexternal stakeholders- Contributing to local communities

Governance
Enhancing corporate value
through better corporate
governance- Corporate governance- Material issues related togovernance

Performance
Improvement in
the Short Term

- Evaluating Board effectiveness- Board members skills matrix- Executive compensation policy for
determining the amount ofcompensation and calculation
methods- Risk management

Reducing
Management
Risk- Cyber security- Supply chain management- Compliance- The dentsu Japan Reform
Committee“Mindset and Behavior Reform”

Mid- to Longterm Value
Creation

Continuous improvement of corporate value

One dentsu Operating Model×
Integrated Growth Solutions (IGS)

Our people

Initiatives targeting our material issues
Innovation leadership

Human capital development, DEI

Climate action

Business ethics & compliance /Data security

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Data

Our businessTransforming ourselves in line with the accelerating changes in our business environment
One dentsu Operating Model × Integrated Growth Solutions

2023 has been a year of challenge for the Group andchange for our business. Since January 2024, we
introduced the One dentsu Operating Model, which
serves as a framework to maximize the service and value
we provide to our clients globally, efficiently, and quickly.
In my career, my experience has spanned across market,
regional, and global-level roles, which means I know
first-hand the challenges of our complex business. I also
know how powerful it is to be part of a winning company.
This is why our paramount goal in 2024 is to recover ourcompetitiveness, meaning we must enhance our focus
on critical sources of growth to gain backstrong momentum.

Giulio Malegori
Executive Vice President,
Global Chief Operating Officer &Chief Global Client Officer,
dentsuTo achieve this, two of our main priorities are toaccelerate and deepen our Integrated Growth Solutions(IGS) and to win in every practice and in every market.
This includes:-c onnecting our capabilities around our clients’ needs todevelop industry leading IGS- s trengthening our client management capabilities,
talent, and organization, supported by clearer, moredifferentiated brand positioning- l aunching a globally consistent One dentsu Client
Management Model

Another crucial priority is to firmly embed our One
dentsu Operating Model. This means implementing asimplified organizational structure to enable faster
decision-making, clearer accountabilities, andempowerment, helping to embed a client-centered
mindset and way of working.
Business Operations and Enterprise Technology arealso key to enabling simplification, integration-led andcross-functional collaboration to drive operational
excellence and create an agile organization, andmomentum to invest and scale our IT infrastructure todrive speed, agility, and flexibility.
Going forward in 2024 we will continue the journey oftransforming dentsu in line with the acceleratingchanges in our business environment, aiming to return tobeing a high performing organization.

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

Our business

Embedding our One dentsu
Operating Model

Clients

Offering: Integrated Growth Solutions

In 2023, we transitioned to a global management
structure under One Management Team, and 2024 sees
the introduction of the One dentsu Operating Model, acommon business management model across all four
regions. This enables dentsu to globally consolidate
customer touch points, promote faster delivery ofdiverse and advanced Practices, and further elevate
operational efficiency.

Client Management

Practicesand equity for our global leadership brands as our hallmark

Integrated Solutionsof innovation and global scale.
BX

CreativeMedia

leverage solutions, services, products, and platforms todeliver differentiated offerings to our clients and attract
talent to our organization.
Master Brand

Global Leadership Brands

2. Practices accelerate growththrough delivering innovative
services and integrated
capabilities to our clients.

+ market specific local brands

Dentsu is our master brand—a critical point of connection

Global Leadership Brands are our go-to-market brands that

1. Client Management delivers
mid/long-term growth for ourclients through strong client
relationships and a deep
understanding of their businesses.

Data & Technology
Global Delivery
Functions

3. Data & Technology underpin
our Practices by developing
scalable, revenue-generating
assets through investments indata and technology.
CXM

Specialized
Practices

4. Global Delivery is the networkof delivery hubs with specialized
talent who provide high-quality,
scaled, and cost-competitive
services to support dentsu’s
diverse capabilities.
5. Functions provide flexible andefficient support to the executionof dentsu’s client-centricbusiness through Centers of
Excellence and experienced local
business partnering.

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Our businessAccelerating and deepening ourIntegrated Growth Solutions

Jean Lin
Global President - Global Practices,dentsuA partnership model that contributes to the sustainablegrowth of our clients
I have been serving as Global President - Global
Practices at dentsu since October 2023. In this newly
created position, my role is to bring together dentsu’s
capabilities and practices through the services that we
provide to our clients. Globally our goal is to provide theoptimal Integrated Growth Solutions (IGS) to our clientsand establish our position as an Integrated GrowthPartner to them.
The world we face is increasingly complex. Whenpresented with new challenges, traditional approaches
will not necessarily work. Integration of solutions isessential for our clients to solve the myriad ofincreasingly sophisticated issues they face and help
them to continue to grow. Since its founding, dentsu has
always taken an integrated perspective and has provided
innovative services to our customers. Our IGS represent
a partnership model that contributes to the sustainablegrowth of our clients.
At the convergence of marketing, consulting, andtechnology, our competitive advantage lies in our strong
client relationships, using creativity to imagine new
solutions, and continuous improvement in data-driven
marketing ROI.

Initiatives that are key to accelerating and deepening IGS
To accelerate and deepen IGS, we are driving crossregional and cross-functional initiatives throughout theorganization. The initiatives shown below are
representative examples.
First, as an approach to meeting the increasingly
sophisticated needs of our clients, we have formed a
global BX team responsible for business transformation
and we are working to enhance its functionality. This is
an important offering that allows us to differentiate
ourselves and create higher added value to our clients.
(see pp. 35–37)
In addition, we acquired global creative production
powerhouse Tag in 2023 as a resource that strongly
complements our ability to provide end-to-end
integrated services from strategy to implementation.
We are making good progress in building a collaborative
structure, and we have already succeeded in securing
new projects in regions such as the Americas. (see p. 37)
To further solidify this momentum, this year we willbolster investments internally and accelerate those in
the data and technology space. Especially whenintroducing technologies such as generative AI, we will
actively utilize collaborative relationships with ourpartner companies to improve the sophistication andefficiency of our operations, while striving to improve ourservices to clients. (see pp. 38–39)
Our people are front and center in the delivery of33

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Our businessexcellence to our clients. We will also focus ondeveloping, retaining, and acquiring leaders who will be
responsible for providing advanced services as well as
talent with diverse expertise.
No need to separate “growth” and “good”
Lastly, I would like to touch on sustainability, which is
the most important driver of innovation in our business
today. If a company can achieve sustainable growth andcreate strategies, products, and services that
contribute to the realization of a sustainable society, it
will not only be acting as good corporate citizen forsociety, but it will also become a brand people respectand have affinity with.
The important thing is that “growth” and “good”
should not be considered separately. A company’s
growth in economic terms is just one aspect of the world
we live in today. We need to put sustainability at the coreof our corporate business strategies to achieve not only
short-term gains but also medium- to long-term growth.
One of the material issues we are addressing
through our 2030 Sustainability Strategy is Innovation
Leadership. We intend to achieve this through thefollowing actions:- Promote investments and R&D for future innovation- Generate SDGs-related thought-leadership andproposals with a clear call-to-action- Create social value through partnerships and ecosystems
By pursuing these actions from a medium- to long-term
perspective, we will work with our clients to solve social
challenges and generate both economic and social
value as a leading B2B2S (Business-to-Business-toSociety) company.

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Our businessAccelerating and deepening IGS
Initiative 1: Strengthening BX

Business transformation practices
One key initiative for accelerating the delivery ofIntegrated Growth Solutions involves strengthening ourbusiness transformation (BX) practices. In the Japanesemarket, we have received many requests for consultation
about business strategy from client company

Our service offerings under our Holistic Transformation Model that enable transformation and sustainable growth for our clients
Corporate UnitsManagement

HR

Comms

Business Units
IT

R&D

Co-creation/DX
Innovation Promotion

Business/
AdvertisingMarketing

Sales

SCM

Establishing a corporate identity that serves as the foundation for transformation

Purpose Purpose/MVV & Future Vision

Developing strategies, roadmaps and action plans to guide transformation

Transformation Architecture Management Strategy & Management Plan,

Corporate Value Enhancement & IR Strategy, DX Strategy/Data Strategy, Sustainability Strategy

Holistic transformation model

Consistent business development support from strategy formulation to market launch /streamlining and upgrading existing businesses

Business Creation/Transformation Business Strategy & Vision,
New Business Development, Existing Business Transformation & Streamlining,
SCM Transformation

Transformation Architecture
Business
Creation/Transformation

MarketingTransformation

PurposeOrganization/
Engagement
Transformation
Corporate
Transformation

Support for streamlining and upgrading ofmarketing/branding

Marketing Transformation

Formulation and implementation of organizational and HR strategies tofoster a corporate culture of transformation / strengthen engagement

Organization/Engagement Transformation

Rebranding, Marketing Strategy,
Sales & Distribution Strategy,
Customer Data Strategy & Marketing
Foundation Building

Organization and HR Strategy, HR System Design & Talent Development,
HR System Installation/DB Construction, Internal Marketing
System construction / infrastructure transformation to encapsulate transformation architecture

Corporate Transformation IT Strategy, IT Foundation/Data Management Foundation Building & Operation Advancement,
Operational System Transformation & Construction

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management teams over the past decade, so we haveenhanced our BX capabilities. We support thetransformation of businesses and organizations,
including defining their purpose, ultimately supporting
the transformation of the entire company.
Our BX practice is experiencing a high rate oforganic growth that exceeds that of the consulting
market. The capital and business alliance with Dream
Incubator, which commenced in 2021, and the capitalalliance with Ignition Point, which started in 2022, arealso helping to accelerate business growth.

transformation.
As shown in the diagram, we provide BX services forclients ranging from management teams and corporate
divisions to R&D and business units. (see p. 35)
Moving clients towards internal and externaltransformation
Dentsu BX is characterized by three main features:❶ Creativity: This is woven into every phase of theprocess, from the evaluation of client issues to strategy
design and implementation.
We design client-centered BX projects byorganizing issues in a compelling and bespoke manner
through dialogue with clients.

Holistic approach to client transformation
We call our novel approach to achieving sustainablegrowth for our clients the Holistic Transformation Model.
This enables companies seeking transformation to startwith the unique character of their company and makeinternal changes, create businesses, and promote overall

1Creativity❷ Moving people: We move people’s hearts andemotions to shape their attitudes and bring aboutchange. For all BX projects, we believe we must consider

2

Move People

3

Activateand Executethe people behind the project. In projects aimed atdeveloping new products or services, we target ourclients’ customers, and in organizational transformation
projects, we target employees working at the clientcompany. Our insights enable us to fully leverage theknowledge we have accumulated in the marketing
communications domain.
❸ Activation and execution: To realize change, weorganize issues and formulate strategies, while walking
clients through the process of execution and adoption.
We believe our contribution to clients’ sustainablegrowth does not end with the creation of a strategy, butalso extends to execution and accountability.
To achieve this, it is essential to integrate ourpractices outside of BX: Media, Creative, and CXM.
Having these capabilities within the Group further
strengthens our BX capabilities.
Achieving higher added value globally
Our challenge is how to scale up the approach we havetaken in Japan and execute it in our other markets.
Under the One dentsu Operating Model, we haveover 400 BX consultants active worldwide in BX practices
launched in 2024, providing location-free services.
To deploy our BX practice globally, we believe it isimportant to achieve synergy between the capabilities
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Our businessJapan, with the BX skillset that we have cultivated in theJapanese market. To this end, we are proactively
engaged in globally standardized training programs andvarious cross-regional collaborations.
Furthermore, to realize business growth throughcontributions to society, the dentsu good team, whichassists clients in formulating sustainability strategies
and other efforts, is also involved in our BX activities.
We feel that strengthening BX represents an effort
to redefine our value proposition as a company that
conducts business in the marketing communications
domain. This, in turn, will lead to our own transformation.
We will continue to drive change and create everhigher added value not only in our BX actions but also,
by extension, in all our services. In this way, we will help
our clients to achieve sustainable growth.

Accelerating and deepening IGS
Initiative 2: Integration of Tag
A global production powerhouse
Tag is a global omnichannel content production andchannel activation powerhouse to brands and agencies
worldwide. Established in 1972, Tag is the global partnerthat helps brands across borders and cultures. Withteams in 29 countries across the world, Tag offers local
market insights at scale, while our distributed hub modelmeans the wheels are always turning.

With 2,700+ people operating in four key regions(Americas, EMEA, APAC and India), collaborating with4,000+ in-market linguists, Tag operates through one
global production hub and 10 specialist hubs, with one
proprietary technology platform, Digital Interact (DI),designed to connect the end-to-end marketing
ecosystem and help all marketers get more out of every
day – more value, more efficiencies, more impact.
Tag: at the forefront of the AI revolution
Tag offers end-to-end capabilities across all media
channels, ingesting the big idea directly from clientsand Agency Of Record and producing the omnichannel
content needed to fuel the advertising campaign,offering analytics for in-campaign live optimization.
All this is powered through Tag’s proprietary marketing
execution platform, DI – Digital Interact, offeringreal-time collaboration, content management,
insights, and analytics.
Tag is investing heavily in AI: the objective is to
evolve DI - Digital Interact - into Digital Interact Content
Engine - DICE, in order to enable media plan ingest,
production automation technologies, AI acrossproduction, distribution and analytics, dynamic content
distribution and personalization, modular content
production at scale post DCO (dynamic content
optimization) integration, measurement and insights,
and client communications and auto-briefing.

Integration of Tag into dentsu
In July 2023, Tag was acquired by dentsu. Tag remains a
distinct brand and is headquartered in London, UK.
United in business acumen, Tag and dentsu share similarcore values, company culture, and embrace a vision “tobe at the forefront of people-centered transformations
that shape society.”
As our acquisition of Tag significantly expands ourcontent delivery capabilities, Tag’s expertise to deliver
personalized, omnichannel content in real-time andat-scale for clients remains unparalleled across theentire customer journey, unlocking marketing
effectiveness and efficiency.
Equipping brands with engaging, creative
production and sourcing solutions, Tag and dentsu
together provide the perfect platform to help brands
improve marketing ROI, meet ESG initiatives, manage
their carbon footprint, and leverage first, second, andthird-party consumer and customer data to drive growth.
Tag and dentsu bring together their innovation andtechnology infrastructure to help solve clients’ toughest
challenges through the provision of IGS.

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Our businessAccelerating and deepening IGS
Initiative 3: One dentsu,
powered by AI
AI is rewriting our business
Dentsu is an industry pioneer in the multifaceted use of
AI technology, which provides distinctive value to ourclients and society.
AI has been in use since the mid-2010s, and its
impact on society has increased dramatically with the
emergence of generative AI over the past few years. AI is
rapidly transforming traditional workflows bystreamlining all marketing-related activities, fromdata collection, analysis, utilization, and ideation, tocreative production.
AI not only streamlines and automates, it also
contributes to the way creative ideas and content areshaped, generating new expressions and experiencessuch as conversational interactions as well as
personalized, dynamic, and creative content.
Furthermore, AI has proved to be a great help in themost human of activities—generating ideas. In this way,
AI has the potential to fundamentally change the way
we do business with our clients.
The Group has long focused on Customer
Transformation & Technology (CT&T) and has been an
industry pioneer in the use of AI.

After its rapid evolution over the past few years, AI
has become a technology that is indispensable fordentsu to realize its purpose: an invitation to the neverbefore. Rather than being limited to improving internal
operational efficiency, we are now also using AI to solve
challenges facing our clients and society.
Leveraging generative AI: Extensive partnerships, andproprietary products and services
We believe in the importance of our extensive
partnerships, rather than playing catch-up with rapid
technological developments on our own.
As announced in 2023 and 2024, we arestrengthening our partnerships with major techplatforms such as Microsoft, Google, and Amazon Web
Services (AWS). We are also developing several products
and services that leverage these platforms’ cuttingedge generative AI, and 2023 was the first year that we
made these available to market.
As an example, Merkle GenCX is a product that uses
AI to analyze client data and Merkle data to derive various
insights and intelligence. As well as for the optimizationand visualization of budget allocation, the solution uses

natural language to operate data-based functions. These
include AI-based recommendations for optimal content,
channels, and timing tailored to the client.
Dentsu Digital’s ∞AI (infinity AI) series is a onestop product for digital advertising optimization andcustomer experience using chatbots. ∞AI Ads uses
generative AI to automatically generate advertisingtext and banner ads, and improve them to deliver
optimized ads.
∞AI Chat facilitates the creation of chatbots thatincorporate expert knowledge to engage in naturalconversations with customers and users, flexibly
responding to diverse needs.
These are just a few examples. The Group willcontinue to strengthen its collaboration with a wide
variety of players to stay on top of cutting-edge AI
developments and be able to convert them quickly intovalue for clients and society.

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Utilizing AI internally: Improving productivity andtransforming operations
With AI increasingly being seen as a personal assistant,
the Group is applying this internally. One example is theuse of Microsoft Copilot and Microsoft M365 Copilot,
two of Microsoft’s most advanced tools.
Microsoft M365 Copilot, in particular, is a
generative AI solution combined with Office softwarethat supports document creation, email and chat replies,
and online meetings.
Dentsu began using M365 Copilot in August 2023,
and this was presented as a case study at a Microsoft
event in November of the same year. The video featured
dentsu employees using AI to streamline their work.
In addition to the use of these external tools, weare also developing AI tools for specific tasks at dentsu.
The benefits of these initiatives go beyond simply
increasing individual productivity. Automated translation
tools in meetings, for example, facilitate collaboration
across countries. Sharing prompts allow for the sharingof know-how throughout dentsu and acrossorganizations. We are thus promoting collaboration thattranscends various boundaries and positioning generative
AI as a tool to help realize One dentsu.

Urgent need for AI governance initiatives
While generative AI has great potential for business, italso entails ethical risks and social implications. In
response to these challenges, dentsu is working tostrengthen governance by setting up appropriate pointsof contact. This we are doing with comprehensive Groupwide guidelines, in addition to guidelines that reflect
local legislation and norms at multiple levels.
Reflecting our B2B2S (Business-to-Business-toSociety) management policy, we see the governance ofgenerative AI not merely as an obligation, but as anopportunity to improve the sustainability andcompetitiveness of our business. We believe that, bystrengthening the governance of generative AI andproperly understanding its potential and risks, we candeliver the new value it will create.

One dentsu, powered by AI
Today, AI has become a universal technology—a common
language, so to speak—not bound by country or region.
For this reason, it is an area in which we can expect thestrengths of One dentsu to be optimally multiplied.
We are already collaborating with, and learning
from, each other in ways that transcend the boundaries
of brands and regions. The Group will unite to focus on
the utilization of new technologies and pursue the neverbefore, the greatest value for our clients and society.

Note: The text of “Accelerating and deepening IGS - Initiative 3: One dentsu,
powered by AI” is the result of human–AI collaboration.

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Our businessTransformative creativity: connecting our diverse talent to change society
Creativity is the most distinctive feature of dentsu’s
B2B2S solutions.
Creativity is sometimes interpreted as artistic
expression, but we at dentsu define it in a much broader
sense. In Integrated Report 2023, we introduced theYasuharu Sasaki
Global Chief Creative Officer, dentsu

concept of transformative creativity.
This is the new type of creativity we advocate,through which people are moved, companies grow, andsociety is transformed. We stimulate innovation usingnovel methods and unexpected combinations of existing
approaches, to help solve a variety of issues.
Transformative creativity is not only characteristic ofpeople in creative divisions, but an ability possessed bycountless individuals throughout the Group.
B2B2S is a highly complex solution combining acompany’s economic and social value. Correct
strategies alone will not move people, and it is difficult
to create growth for companies in an increasingly
commoditized world.
Nor is it easy to solve complex social issues
involving a variety of factors. And we now live in an age
when anyone can generate expressions using AI. As
people are no longer moved merely by the delicacy of
expression, there is a need for ideas capable ofresonating more deeply in people’s hearts.
Our transformative creativity always starts with ourpeople. And by using the power of ideas, the power ofcraft, and the power to execute projects, we connect ourpeople to media, platforms, and companies. This allows
us to maximize the power of individuals and transform it
into a positive driving force for social change. Below, wehave listed some examples.

- Voice Watch is a system developed in collaboration
with an auto maker that uses AI-generated voicecommentary enabling everyone to enjoy sports andentertainment- Scrolling Therapy is an app that serves users as an
exercise tool to help improve the early symptoms of
Parkinson’s disease- The Shopping for Good project is a social contribution
platform in which many companies participate, enabling
consumers to support charities while they shop
- Project Humanity is a joint research and development
project involving a telecommunications company thatenables people living with ALS to use their own bodies
to move avatars freely in digital space- We are a supporting partner of WOTA’s initiatives targetingthe social implementation of water recycling systems- Butterfly Check is a tool facilitating the analysis ofconnections between biodiversity conservation andbusiness growth- The De Owarasenai Platform which we developed makes
it easy and affordable for people to take part in recycling
The abundantly creative B2B2S solutions offered bydentsu are born from unexpected combinations of thediverse functions and talent across the Group. We willcontinue to pursue the creation of innovations that
impact the world by placing people-centered creativity
above all else.

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Case Studies ｜ B2B2S
Voice Watch
Helping create a society in which everyone, including thevisually impaired, can enjoy sports together

AI has been used for the first time to provide
real-time, play-by-play audio commentaryenabling the visually impaired to enjoy
motor sports.
“I don’t understand what’s going on in front of me when I go to the venue.”“I don’t feel comfortable asking friends and family to explain what’s going on during the race.”“Even if everyone else is excited, we don’t feel like going to the venue because we can’t
get in on the excitement.”
Visually impaired people often have difficulty enjoying sporting events because
they cannot follow the action, so Voice Watch was developed in recognition of thedisparity in the amount of information available to people of various abilities.
With support from the Toyota Mobility Foundation, technology was created toconvert a wide range of race data into audio information and generate play-by-playcommentary for the visually impaired in spectator stands at racetracks where play-byplay commentary is unavailable.
Camera images depict the race as it happens, while changes in race conditions arequickly detected and communicated, based on the analysis of driving data. The system also
constructs unique speech frames based on knowledge of professional announcer techniques.
The images and speech frames are combined to generate real-time, play-by-play phrasing.
Voice Watch was used at Super Taikyu, Japan’s biggest endurance race, where it
created a new motor sports experience that enabled spectators to “listen” to the race.

The technology was the winner inthe Best of Artificial Intelligence
category at the 102nd ADC Awards
in New York. As a Good DesignAward 2023 winner, the technology
has been included in the Good
Design Best 100.
Voice Watch has been expanded for
application to other sports, and wasused at the 2023 World Aquatics
Championships in Fukuoka.
Trials currently are being conducted
at elementary school athletic
meets and other events. Our goal isto help create a world in which
everyone can enjoy all kinds ofsports, regardless of physical ability.

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Scrolling Therapy

Shopping for Good

Mobile app to help mitigate early symptomsof Parkinson’s disease

From a “consumer” society to a “giving back”
society. A project aiming to make a positive
impact on society through everyday shopping

According to the World Health Organization (WHO), some 8.5 million people are livingwith Parkinson’s disease worldwide. For this reason, Dentsu Creative teams in Argentina,
Brazil, and the US collaborated with Eurofarma, a major Brazilian pharmaceuticalcompany, to develop a tool that helps mitigate the early symptoms of Parkinson’s,
including facial muscles becoming stiff and rigid.
This tool is a smartphone app that enables users to perform the hand-based
movements necessary to browse social media using their facial expressions.
Using AI-based facial recognition technology, users practice facial expressions
guided by the emojis for surprise, sadness, happiness, anger, and disgust that appear in
the app. The app supports users’ daily physical therapy while they browse social media.

Dentsu Inc. has launched and helps to operate the Shopping for Good Project
Promotion Committee, together with leading Japanese manufacturers, payment service
providers, and retailers.
When customers purchase eligible products at participating stores using a specificpayment method, 1% of the purchase amount is donated to charitable organizations.
Customers will also be awarded up to an extra 10% in reward points.
In addition, companies participating in this project donate 1% of the sales tocharitable organizations. By developing campaigns that incorporate charitable
contributions into everyday shopping, we are creating a new economy that is not only
sustainable, but also spreads good around the world.

Over 45,000 physicians in 10 countries are using theapp, which won the Pharma Lions Grand Prix at Cannes
Lions 2023. The app was a finalist in the Social Media
category of the Innovation Awards at South bySouthwest (SXSW) 2024, one of the world’s largest
festivals for creatives.

The first stage of the project was implemented in
2022, and the second in 2023. The project had acumulative total of approximately 810,000
participants and raised over 37 million yen in
donations, the impact of which is steadily
expanding. The third stage is slated for 2024.

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Project Humanity

The world’s first project enabling people
living with ALS to control avatars in thedigital space using electromyography andregain physicality
Amyotrophic lateral sclerosis (ALS) is a disease in which motor nerves are damaged andcan no longer transmit commands from the brain to muscles. This gradually makes it
increasingly difficult to move muscles throughout the body. An estimated 400,000
people worldwide are living with this disease.
Project Humanity was jointly developed by Dentsu Lab Tokyo, Nippon Telegraphand Telephone Corporation (NTT), and WITH ALS. It aims to facilitate the manipulationand control of physical avatars in the digital space using electrical signals(electromyography) emitted when muscles are moved.
The individual’s body is fitted with electromyography sensors that acquire biometric
information from minute muscle activity, which is then converted into information tocontrol the avatar. With these technological advances, we envision a future in which eventhose with physical disabilities will be able to operate avatars through their own will andsenses in real time through the power of electromyography signals.
Project Humanity was the only project from Japan chosen as a finalist in the Interface Design category of the Innovation Awards
at South by Southwest (SXSW) 2024.
In addition, the project received the Grande for Humanity award at ADFEST 2024. This award recognizes creative excellence andis given to a project that demonstrates aspects such as services and significance to society with outstanding creativity.

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WOTA CORP.

Creating sustainable water infrastructure by partnering with a start-up that aims to implement
small-scale decentralized water recycling systems in society
Access to safe water and sanitation is fundamental to supporting human health andwell-being. According to the United Nations, water resources currently available tohumanity will meet only 60% of the global demand expected in 2030.
In addition, Japan’s government budgetary allocations for the maintenance ofwater- and sewage-related infrastructure are deteriorating. This is due the population
decline and accelerated aging of water and sewage infrastructure.
Against this backdrop, WOTA CORP. is developing and marketing a small-scaledecentralized water recycler. This compact water reclamation system instantly turns
used water into water that can be usable again.
Since first connecting with WOTA in 2020, dentsu has supported WOTA through twointernal organizations. One is the Future Creative Center, which envisions and aims tohelp bring about societies and businesses of the future. The other is dentsu Startup
Growth Partners (SGP), which specializes in supporting the growth of start-ups.
Transcending the boundaries of advertising, we have worked directly with WOTA’s
management team to partner in the company’s growth through numerous initiatives.
These include the implementation of the WELCOME WASH project to promote public
hand washing outside the home during the COVID-19 pandemic; formulation of a masterplan to visualize WOTA’s medium- to long-term growth; and taking the lead in forming an
alliance with, and investing in, Japan’s largest toiletry company.
In 2023, we also invested in WOTA through the Dentsu Ventures SGP Fund. We are
currently promoting the social implementation of WOTA’s water circulation systemthrough efforts including the development of global brands.
By supporting WOTA, we aim to contribute to structural solutions for waterrelated issues.

WOTA is providing “WOTA BOX,” private rooms for warm
showers, and “WOSH” sanitary hand washing stations innearly all areas where water was cut off due to the January2024 Noto Peninsula earthquake in Japan.

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Butterfly Check

The De Owarasenai resource platform

Providing visibility to biodiversity impacts
and business outcomes

Promoting consumer participation in thecircular economy

Butterfly Check is a service that supports initiatives aiming for nature positivity, jointly
developed by Dentsu Inc. and Think Nature Inc., a startup company that holds some of
the world’s largest natural capital big data.
This service is an original solution by dentsu that enables integrated analysis basedon evaluations from different stakeholder perspectives, including not only themeasurement and visualization of the impact of a company’s nature-related activities on
ecosystems from a scientific standpoint, but also how this relates to business activities
such as branding.
By measuring the impact of a company’s nature-related activities on both biodiversity andbusiness, and comparing them from abird’s-eye view using a diagram
modeled after the wings of abutterfly, we analyze the relationshipbetween these two interconnectedconcepts, which had previously been
considered separately, to identify
areas for improvement and further
business opportunities. The service
has wide-ranging potential for new
business development and corporate
branding, with the aim of creating asustainable cycle that enriches bothbiodiversity and business.

The resource circularity platform De Owarasenai—in English roughly meaning “it doesn’t
end here”—was developed by Dentsu Inc. in Japan. This platform allows arterial andvenous industries to be digitally connected with consumers, thereby promoting a cycle ofpurchasing, collection, and recycling.
For two months starting in November 2023, dentsu conducted a proof-of-concept
trial with Lawson, Meiji, and Nakadai Holdings.
We not only connected manufacturers, distributors, and recyclers, but also
leveraged our marketing expertise to create a system that enables consumers toparticipate in the circular economy. The response we received from stakeholders
including government agencies and the media was huge, and twopatents are currently pending.
Consumers who take empty paper milk cartons to a Lawson store
are eligible to receive discount coupons for Meiji Oishii Gyunyu-brand milk.
We considered collection and recyclingfrom a marketing perspective, and bycreating purchasing incentives based oncollection, we are encouraging consumer
behavioral change as well as supporting
companies by contributing to their businessand reducing their environmental impact.
Analogous to blood circulation in the body, industries that create
products using natural resources are referred to as arterial
industries. Those that collect, process, and recycle the resulting
waste are referred to as venous industries.

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Sustainable transformation (SX) and branding
Sustainability Consulting OfficeDentsu Inc. established a dedicatedsustainability transformation (SX)
consulting department in 2023 toprovide solutions on themes such as thecircular economy, DEI, biodiversity,
decarbonization, and ESG. This new
endeavor brings together sustainability
experts and branding professionals inareas such as creativity, PR, digitaltransformation, and space design.
With “Sustainability for New
Growth” as our vision, we uncover theunique growth potential of eachcompany through a sustainability lens,and by taking a multistakeholder
approach and forging new relationships,
we aim to achieve growth and enhance
corporate value. We provide
comprehensive business support from the
SX strategy phase to the execution
phase, which includes symbolic actions
as well as internal and external branding.

Shareholders/
Investors

Employees
Corporate

Desire totry something new

Corporate
Actions

Desire to support
from a mid- tolong-term perspective

New
GrowthCompany’s
Inherent Potential

Work together tocreate markets andshape values

Business

Co-creation
partnersServices
Products

Desire to continue
using even at ahigher priceConsumers

Note: The “Butterfly Check” and “De Owarasenai Platform” introduced on p. 45 are examples of this organization’s work.

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Aspiring to win as a people-centered company
Multiplying our expertise to drive dentsu’s transformation

Shaping the future through people-centered investment
Dentsu’s vision to be at the forefront of people-centeredtransformations that shape society captures our passion
for unleashing human potential and harnessing thisenergy to make meaningful contributions to society.
Building on this foundation, our approach to humancapital embraces the universal drive for contribution andgrowth. We hold that true fulfillment comes frompersonal development through active participation. By
fostering an environment that promotes bothcontribution and self-directed development, dentsu’s HR
practices are designed to initiate a virtuous cycle:
investing in individual potential fosters further
contributions, which, in turn, fuel ongoing reinvestment
in our people.

Miho Tanimoto
Global Chief HR Officer (CHRO),
dentsuStrategic synergy—HR leadership to amplify
management goals
Integrated Growth Solutions (IGS) harness the uniqueand diverse talents of our employees to drivecompetitive advantage, emphasizing a people-centeredapproach. The goal of the One dentsu Operating Model(ODOM) is to drive global growth by implementing IGS
across all our operations. We are actively fosteringcollaboration across the Group to establish a cohesive
service delivery system.
Starting with our people, we identify two crucial
conditions essential for realizing our management strategy.

First, we aim for every employee to feel actively
engaged in achieving our objectives. Second, we strive
for both organizational and individual excellence,
fostering an environment where diverse professional
talents connect, learn, and synergize their expertise
toward a common goal.
Miho Tanimoto joined the Dentsu Group as Chief
HR Officer (CHRO) in January 2023, significantly
accelerating our advancement towards this strategic
goal. Initially, she unified the previously separate HR
leadership teams in Japan and International into a single,
global team to enhance proactive collaboration.
Under her leadership, this integration has fosteredongoing dialogues and information sharing among
regional HR leaders and functional HR leaders,
including compensation and operations, thereby
establishing a framework for globally consistent
strategies and practices.
A robust connection with the governance structures,
particularly the Nominating and Compensation
Committees, was established, ensuring full alignment
between HR and broader management strategies.
Empowering employees with our HR mission and strategy
The foundation of our global HR strategy is rooted in the
mission that defines the very essence of our function.
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maximizing the potential of each individual and theentire organization, facilitated by seamlesscollaboration among all HR teams.
Our HR strategy is built on three foundationalpillars. The first, “People growth,” focuses on thedevelopment of individuals and teams, emphasizing thecultivation of leadership skills. The second pillar,“Winning as One Team,” leverages diverse capabilities tofoster collaboration and achieve unified goals. The third
pillar, “HR service excellence,” aims to elevate thequality of our HR services, thereby supporting andenhancing the effectiveness of the first two pillars.
These pillars are interdependent, striving forintegrated, expansive outcomes globally as One dentsu.
Moreover, we set DEI as the foundation of our strategy tocreate an environment where our diverse talent canbring their best self to work.
As we implement this strategy, we will establish
various indicators for each outcome to measureprogress. This approach will enable us to quantitatively
assess the returns on our human capital investments andadjust our initiatives based on their progress andeffectiveness. Key indicators, designated as material
KPIs, are specifically aimed at boosting the Group’s
corporate value.

Purposean invitation to the never before.

VisionTo be at the forefront of people-centered transformations that shape societyManagement
strategy

Creating value for our clients and society(B2B2S)

Providing Integrated Growth Solutions
under the One dentsu structure

Global-scale efforts, realized as One dentsu
Capabilities multiplying diverse expertise

People growth

Winning as One Team

Individual growth support

Organizational environment supporting growth

Talent development
program supporting andevaluating performance

HR and DEI
strategy

Awareness of contributing to objectives(high engagement)

Sense of growth
DEI promotion
Compensation design
Integrity & compliancepromotion

Driving growth through leadership
dLA / People Discussion
selective program

Successor pipeline
People development
system and culture

Execution

HR service excellence

Utilizing diverse talent
Enhance collaboration& integrity

Execution

HR growth

HR business partner
Data & system
Career framework

HR service provision capability/productivity improvement
Contribute to decision-making by improving accuracy of HR
information

Foundation of DEI
Items in red are regarded the most important outcome elements with established indicators.

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HR strategy 1: People growth• Shaping future leaders at dentsu
As an initial step in fostering leadership development, wehave established the dentsu Leadership Attributes(dLAs)—behaviors that encapsulate the essential values
all dentsu leaders should exemplify. The dLAs include
five key elements representing the traits valued inleaders, which, alongside steadfast integrity, form the
backbone of our talent management framework.
With the introduction of dLAs, we now assess anddevelop our talent based on both work performance andleadership behaviors. Initially, dLAs were employed as anevaluative tool for key executives in dentsu Japan.

dentsu Leadership Attributes

Drive Change

NurturePeople &CultureLead with
the Clientat Heart

FosterInnovation
through
One dentsu

Demonstrate
GlobalLeadership

Uncompromising integrity at all times

Moving forward, we aim to broaden their application to
include a wider target group, integrating dLAs into ourprocesses for talent selection, evaluation, and training.
• Cultivating growth through People Discussions
To build robust teams across all regions and divisions, we
initiated People Discussions using the dLAs to assess
talent comprehensively. In 2023, this approach enabled
us to identify key talent and potential successors for 15
critical roles, while also facilitating targeted discussions
around development investments. Following these
discussions, we have already selected certain individuals
to undergo new growth experiences.
In 2024, we aim to broaden the scope of our
discussions, further structuring this cycle of dialogue todeepen and widen understanding of our talent pipeline.
We anticipate that regular discussions at each level ofthe organization will enhance managers’ awareness andproactive behavior in nurturing their teams.
• Unlocking bold growth opportunities
Talent identified through People Discussions will be
strategically offered opportunities to develop
themselves in diverse global and local settings. Thesedevelopment programs are designed to expand theirskills and perspectives. There is an urgent need tocultivate talent capable of integrating various dentsu
capabilities and delivering high-level growth solutions inalignment with the new ODOM.
To address this challenge, we have introduced thedentsu Leadership Connect program. This initiative
gathers top global talent to master ODOM practices,aiming to break down divisional silos, explore anddiscuss the creation of new value throughcollaboration, and foster relationships that enhance
post-program business practices.
Furthermore, we are rolling out global programs
such as EIGYO, which leverages the strengths of ourJapanese business operations to offer integrated client
solutions worldwide, and Path of Tabei, focused on
developing female leaders and facilitating individual
growth and networking across the organization.
Additionally, beyond fostering dialogue between
employees and managers through regular performancedevelopment discussions, we also offer extensive
opportunities for skill development and reskilling. Our
online learning platforms cater to diverse business needs
with courses ranging from data, technology, andmarketing to liberal arts, enhancing creativity.
These initiatives have also significantly bolstered
our Customer Transformation & Technology (CT&T)
capabilities, a designated priority area. Consequently,
the proportion of personnel engaged in this sector within
the Japanese market has grown from 37.0% as ofDecember 31, 2022, to 39.2% by December 31, 2023.

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By integrating the above initiatives into our talentmanagement system, we aim to offer equitable,
practical growth opportunities, cultivate diverse skills
and strong leadership, and foster a culture that supports
and develops our people.
To track our progress towards these goals, we will
monitor time spent in People Discussions and succession
coverage, alongside assessing employee awareness ofgrowth opportunities through an engagement survey.
HR strategy 2: Winning as One Team
• Issues identified from the engagement survey
Employee engagement is crucial for fostering acollaborative team culture. The Group measuresengagement through an annual survey, and all teams
analyze their scores to identify areas for improvement.
These engagement scores are integrated into the KPIs
for executive compensation, reinforcing management’s
commitment to enhancing workplace culture.
The Group’s employee engagement score for 2023
stood at 66, marking a two-point decline from theprevious year. This score reflects varying trends infactors between Japan and International; Japaneseemployees highlighted challenges on future prospects,
senior leadership, and innovation, whereas employees
from other regions focused on vision and strategy, career
opportunities, and change communications.

Despite these regional differences, there are clear
opportunities for improvement in the frequency, clarity,and consistency of leadership communications. In
response, we have enhanced our internal channels andinteractions, both in Japan and International.
Acknowledging the need for more in-depth
strategic messaging and robust two-way
communication, we have intensified our efforts. These
include organizing the first large-scale, in-person, seniorleadership meeting post-pandemic.
Simultaneously, responses related to personal
integrity and compliance awareness—critical from agovernance standpoint—received high scores. We view
this as a promising opportunity to elevate awareness andrefine our governance activities further.

Engagement score

66(Top 5 rankings by score)

Personal integrity

81

Respect

78

Compliance78

Leader integrity

75

Client contributions

73• Strategic incentives to boost collaboration
To reinforce IGS as One Team, we are revising our
incentive structures to promote behaviors that harness
our collective capabilities for superior outcomes. In
2023, we established a Compensation Philosophy thatnow underpins our compensation system and has begun
to influence senior-level discussions.
We have adjusted compensation schemes inInternational to align with the ODOM concept. Thisadjustment promotes cross-selling and collaboration
and rewards long-term performance, particularly
among senior-level employees with significant
organizational influence.
We are also dedicated to fostering non-monetary
incentives. Since 2023, we’ve introduced the Northstar
Awards, a Group-wide initiative celebrating exceptional
achievements and sharing of insights. We tailored theaward themes to align with key business strategies,
including IGS and B2B2S, showcasing these awards as
exemplars of the Group’s strategic objectives.
• Valuing employee voices to forge a unified team
To verify the effectiveness of our organizational culture,
where diverse talents collaborate as One Team toenhance performance, we measure outcomes byanalyzing employee attitudes from various perspectives.
We use the engagement score to gauge overall
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ensure everyone is in a state where they can contributein a positive way. We also evaluate the extent of
employee collaboration and integrity using survey scoresand qualitative data.
Furthermore, to enhance awareness throughout theentire Group, it is vital that employees of diverse
attributes across all levels actively contribute in their
distinctive ways. Central to this effort is our DEI strategy,
which taps into the potential of diverse talents. The
specifics of this strategy will be detailed in the following
section (p. 53).
HR strategy 3: HR service excellence• HR partnerships supporting business transformation
HR Business Partners (HRBPs) deliver critical support tothe business, serving as a foundational element of our
HR function and significantly influencing businessperformance. In International, we have realigned HRBPs
to fit our new business operating model better,establishing a structure tailored to meet specificbusiness demands effectively.
Concurrently, we are exploring the pilot
implementation of HRBP functions in Japan, our largest
market, integrating broader insights from other regions.
This initiative is already yielding tangible outcomes, suchas a better understanding of organizational challenges
and pinpointing potential candidates for global
leadership roles.

• Leveraging data for operational excellence
We continue to enhance our investment in people data,
particularly improving data quality and developing
standardized data sets across the Group. One significant
challenge has been Japan’s diverse corporate landscape,complicating the establishment of uniform definitionsfor key people data.
Nevertheless, the creation of a unified data
template in 2023 has enabled a comprehensive overview
of our talent across companies, using standardized data
definitions. This not only improves the accuracy of our
key metrics but also supports the data-driven
development of future organizational strategies.
To standardize talent data across the Group, we are
implementing the One dentsu Career Framework inJapan, a system of job families and levels already inplace in other regions. This was implemented for ourGroup Management in 2023. Our future goals include
broadening its application to enhance strategic resource
management, talent allocation, and career development
opportunities, all based on this data framework.
Currently, a project is in progress to introduce consistent
job levels across our Japan business.
We are also advancing our efforts to enhance theefficiency of daily operations through processoptimization, automation of high-volume tasks, andleveraging shared services in cost-effective regions.
Acknowledging regional operational differences, we are

set to revise processes and systems where broader
optimization would be beneficial. Our goal is to boost
productivity further through global integration andstandardization of operations.

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Believing in brilliance: HR’scommitment to energizing our people
Miho Tanimoto,Global Chief HR Officer (CHRO),
dentsuIt’s hard to believe a whole year has flown by since I
joined the vibrant dentsu community. This past year,
we focused on a global initiative to identify our top
100 leaders, shaping a leadership vision that drives
our Group’s growth and informs our succession andtalent development strategies.
Believing in the power of positive leadership tostrengthen our organization, we engaged inmeaningful dialogues across various organizational
levels to craft the dentsu Leadership Attributes.
These in-house discussions, leveraging our global
capabilities, were not just strategic but also avaluable opportunity for us to reflect on who we are
and what we aspire to be.
Through dialogues with employees globally,
we’ve gained insight into their expectations for theGroup. It was particularly striking to hear many ofour dentsu people highlight taking initiative as a key

strength. They cherish our culture of proactive
thinking and collaboration, enabling us to deliver thebest solutions to our clients. It is inspiring to see such
enthusiasm for this way of working.
Moreover, from conversations with employees
engaged across various regions and disciplines, I’ve
learned that embodying One dentsu not only
broadens business opportunities but also enriches
their experiences by allowing them to work with adiverse team of professionals. This has bolstered myconfidence in the One dentsu strategy we have been
advancing since 2023.
People are the heart of dentsu’s business. In
HR, we see it as our mission to believe in ourpeople’s potential and support them in fostering avibrant organization.
In 2024, I am intensifying my focus on Japan, ourlargest market, by expanding the People Discussions
initiated in 2023 to leaders at levels further down.
We have also launched a global talent development
program to actively offer growth opportunities toindividuals highlighted in these discussions.
By openly discussing leadership as a key
evaluation criterion, we aim to inspire many

employees to reach even higher. It’s important to me
that our people who contribute value are recognizedfairly, moving away from traditional metrics such as
working hours and sales figures. I believe that
fostering a culture where everyone is encouraged totake initiative will help us maximize the potential of
our people.
Employee engagement thrives on transparent
storytelling from our leaders. Last year, our President& Global CEO, Hiroshi Igarashi and I shared theengagement score results and action plans with all
employees. I also hosted a town hall with Japan CEO,
Takeshi Sano, titled “How are executives chosen?”and shared the People Discussion process andapproach. Through open communication anddialogues addressing strengths and areas for
improvement, we aim to build trust between theleadership team and employees and gather vital
insights for change.
Our new slogan, “We aspire to innovate andsurpass expectations,” reflects our collective
ambition. Committed to this vision, I will continue
guiding HR to develop the exceptional talent thatdefines dentsu.

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Dentsu DEI showcases
personalities and strengths

Unleashing the talent of 71,000 diverse individuals
to drive business and society
As talent is the source of dentsu’s competitiveness, DEI
is positioned as one of our material issues. The Groupwill continue to propose new value to meet theincreasingly complex challenges of clients and society
by bringing together diverse individuals with expertiseand uniqueness, and by demonstrating strong
capabilities as a team. In promoting DEI, we areproactively working to create an environment where
every employee can fully demonstrate their abilities
with a sense of fulfillment, while fostering a corporate
culture that respects colleagues and transforms mutual
differences into strengths.
Autonomously discovering issues to generate ideas
and actions
An inclusive corporate culture can only be nurtured andstrengthened when DEI is integrated into the experienceof every employee. Thus, in fostering DEI at dentsu,
rather than relying on top-down instruction, weemphasize the importance of each employee identifying
issues themselves, considering actions that involveothers, and taking initiative. We will demonstratecreativity and the ability to execute, which are theGroup’s strengths, while continuing to take on thechallenge of transforming our company and society.

multifaceted, multi-layered actions that take into
account differences in social backgrounds and cultures.

The four pillars of our DEI strategy
Our DEI strategy comprises four pillars: Transparency
and Accountability, Representation and Sponsorship,
Education and Continuous Learning, and Impact on
Clients and Communities. We have a regional Chief
Diversity Officer in Japan and Chief Equity Officers
across the Americas, EMEA, and APAC. Our DEI leaders
are working closely together to accelerate the One
dentsu Operating Model (ODOM) to maximize employee
job satisfaction, mutually leveraging talent resources,
capabilities, and practices in each region, while working
to develop a clear global strategy and promote

DEI strategy 1: Transparency and accountability
DEI is at the center of dentsu’s vision “to be at theforefront of people-centered transformations thatshape society.” We believe that to deliver on our vision,
we must ensure that we are truly representative of thesocieties we serve. To hold ourselves accountable, and tocultivate an environment where we all work together tomake progress in fostering a diverse and inclusive
culture, we track and transparently report our progress
towards certain aspirational goals.

Atsuko Kuchiba
Chief Diversity
Officer, dentsu
Japan

Christena Pyle
Chief Equity
Officer, dentsu
AmericasPauline Miller
Chief Equity
Officer, dentsu
EMEA

Rashmi Vikram
Chief Equity
Officer, dentsu
APAC

As one indicator of employee demographic
diversity, the Group is working towards an aspirational
goal to achieve a 45% female leadership ratio by 2030.
In addition, this year we added an aspirational goal toachieve an engagement survey “respect” score of 80
points by 2025. Our hope is that by measuring the extent
to which our employees feel they can engage in theirwork while practicing mutual respect, we will enhanceawareness of our differences and further refine ourcorporate culture, which turns individual differences into
mutual strengths. This is also one of dentsu’s strengths.
Note: Percentage of representation other than by gender in each region isavailable in the Diversity, Equity & Inclusion Report 2023 [published
December 2023].

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DEI strategy 2: Representation and sponsorship
We will expand our recruiting practices to reach morediverse talent, and enhance our work environment to be
more inclusive, creating a fair workplace for everyone.
Currently, we promote the representation ofunderrepresented groups in society through actions in
the workplace as well as by connecting with externalorganizations and teams.
We have several employee resource groups (ERG)
that, having been established by employees themselves,
encompass a wide range of demographic groups anddiverse perspectives. We proactively encourage mutual
support and awareness-raising activities led byindividuals who self-identify with the target
characteristics of the groups as well as their allies.
• Gender equality
Through the aforementioned training programs andother initiatives, we aim to create an environment inwhich our female employees are supported andempowered to pursue diverse career paths and play
active roles on their teams.
Our commitment to gender equality also extends
beyond the workplace. Two representative examples are“Visible Voices” (EMEA), a short film in which employees
tell their personal stories while raising awareness ofsocial and political issues, and “Femtech and BEYOND”(Japan), which aims to grow the femtech market byworking with clients to identify business issues andimplement actions, including product design, to resolve
women’s health issues and gender-specific challenges.
• Inclusion of people with disabilities
In a society where one in five people lives with adisability, dentsu will continue to take on the challenge
of designing inclusive workplaces and striving to shape asociety that promote accessibility for people withdisabilities. For dentsu, where talent is the basis of ourcompetitiveness, leveraging and expanding the abilities
of colleagues with disabilities is synonymous withexpanding the potential of humanity.
In Japan, we have been commissioned by Tokyo’s
Setagaya Ward to undertake the Nofuku Partnership
Project, which aims tosolve local issues bypreserving farmland,
promoting
employment forpeople with disabilities,
and increasing wages.
We also promotevarious internal efforts
to facilitate
understanding andawareness, such as the“Neurodiversity ERG”

(APAC) session series that raises awareness aroundautism, ADHD, dyslexia, and other neurodivergent traits.
These help us create an inclusive workplace at dentsu.
Our efforts include the Valuable 500, aninternational initiative in which 500 global corporations
collaborate to promote the inclusion of people withdisabilities, as well as the Disability Equality Index
created by the global organization Disability: IN tobenchmark disability inclusion in the workplace.
• LGBTQ+ inclusion
Supporting LGBTQ+ colleagues working in our Group is
critical in helping to create a society that embraces
diversity, promotes equality, and celebrates the rights
and identities of all individuals.
In addition to the various initiatives led by LGBTQ+ERGs at offices worldwide, during Pride Month, thecreativity we have developed in our advertising businesshas enabled us to launch LGBTQ+ awareness andinclusion campaigns in various countries, including“Dentsu & Friends” (EMEA), “Dentsu pride NXT SPACE”(Americas) and LGBT+ ERG (APAC). In Japan, dentsu
received the highest “Gold” rating in the PRIDE Index,
which evaluates corporate initiatives for LGBTQ+
inclusion in the workplace, and “Rainbow” certification
as a company promoting initiatives that have acollective impact.

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Our people• Multicultural inclusion
With over 71,000 employees from different cultures andbackgrounds working at dentsu, we are dedicated tocreating an environment of mutual respect that fosters
a sense of belonging. As a founding member of theWorld Economic Forum’s Partnering for Racial Justice inBusiness initiative launched in 2021, dentsu is committed
to cooperating with, and supporting, individuals andorganizations through empowerment aimed at creating
fair and equitable work environments. Additionally, theGroup actively supports and participates in the BlackEnterprise Women of Power (BEWOP) Summit(Americas), a pivotal conference focused on professional
leadership for female executives of color.

• Generational inclusion
Teams comprising employees of multiple generations
combine wisdom and experience with fresh perspectives.
The Group is committed to providing resources, a senseof community, and learning opportunities for employeesof all ages and career levels. Our initiatives include being
the first advertising agency in the UK to partner with 55/
Redefined, which is focused on combating age
discrimination and improving the representation of
employees over-50 in the advertising industry. In
recognition of ourproactive approach andemployment policy, we
received the “Age Inclusive”
and “Age Friendly”
certification marks.

health issues, is provided in nine markets including Japan.
Further, we established and continue to run Lavender
Ring, a social contribution activity conducted in Japan
with the mission of “Bringing smiles to the faces of allcancer survivors.”• Health and wellness
Employee work styles and values may change due tomental health or illness. We are committed to listening
to concerns, educating employees, and providing
resources. This includes comprehensive training
programs that prioritize both mental and physicalhealth, ensuring robust support for employees.
Mental Health First Aider, a global training programthat provides information and teaches skills to assist
employees, their family members, and friends facing
mental health issues or crises resulting from mental

DEI strategy 3: Education and continuous learning
Education and learning opportunities are invaluable fordentsu’s diverse talent to develop new skills and discover
new possibilities. Through a variety of careerdevelopment and pipeline programs, including thosepreviously mentioned, the Group is accelerating
investments in employees at all career stages (for moredetails, please refer to the programs listed in our 2023
DEI Report).
These programs foster inclusiveness andcollaboration among a diverse employee population

Lavender Ring activities

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with different experiences and backgrounds, whilestrengthening our ability to provide solutions to clientsand address social issues.
In Japan, we continue to provide DEI Park, anoriginal learning platform that encourages feedback
from, and dialogue with, minorities within the Group,
while encouraging all employees to think and act
autonomously. This initiative results in more than 200
bottom-up actions each year.
At the same time, as an investment in the future ofsociety as a whole, dentsu provides internshipopportunities for external partners. These include the“SkillBridge Program” (Americas), which partners with the
US Department of Defense to assist veterans in changing
careers, and the “Topu Toa Internship Program” (APAC),
which partners with the New Zealand non-profit Topu Toa
to increase employment opportunities for Maori people.
DEI strategy 4: Impact on clients and communities
In promoting DEI, we also pursue our B2B2S
management policy. Through collaboration with likeminded partners around the globe, we are broadening
the world of DEI advocacy, from the corporate world towider society, by engaging people, addressing social
issues, promoting inclusive business practices, anddriving social change.
In Japan, ten Group companies jointly organized asports festival for people with severe disabilities who

have difficulty playing in Paralympic sporting events.
Twelve teams from special needs schools and otherorganizations and over 100 dentsu employee volunteers
participated in this event, creating opportunities forinteraction and self-realization through sports.
As an industry leader, dentsu is committed tofostering more inclusive marketing and advertisingbusinesses through partnerships with organizations andassociations worldwide that represent their respective
industries. These include the establishment of a DE&I
Committee within the Japan Advertising Agencies
Association, an alliance with the Association of
National Advertisers to publish the “See Her” report, apioneering campaign advocating for gender equality inmedia and advertising. Additionally, “OWN-IT”(Americas), is a fellowship program facilitating access tobusiness opportunities across our network andpromoting the mentorship of female entrepreneurs bycorporate executives.

To realize an inclusive society, we held the sporting event IncluFES to provide
people with severe disabilities with the opportunity to play sports.

Note: For information on other representative partnerships, please refer to “OurPartnerships” in the DEI Report 2023 [published December 2023].

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Working towards progress indicators to realize our ideal HR image
Ideal image

Indicators of progress

Targets2023 achievements

Employees willing to contribute positively
to the team/organization (high engagement)

Engagement score*68 (2024)

66

Employees adding new capabilities with adequate
growth opportunities“Growth” score*

No target(new indicator)

66

Well established successor pipeline(leadership development)Group executive management
successor readiness rate

No target(new indicator)

None

Firmly rooted HR development systems and culture

People Discussion time

No target(new indicator)

None

Diverse talent are empowered and active(with a focus on gender first)

Female leader aspirational goal

Employees work with mutual respect for each other“Respect” score*

Active collaboration among employees“Collaboration” score*

No target at this time69

Engaging in correct behavior based on integrity“Personal integrity” score*

No target at this time81

34.3% (2024)
Targeting 45% in 2030
79 (2024)
80 (2025)

32.4%
78

Indicators in green are formulated as Materiality-related KPIs.
* Measures each score in the engagement survey.

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Human rights
Promoting and respecting human rights as a core business strategy
Dentsu is committed to upholding all internationallyrecognized human rights and the UN Guiding Principles
on Business and Human Rights in every aspect of ouroperations. Promoting and respecting human rights as acore business strategy not only aligns with our vision to
be at the forefront of people-centered transformations
that shape society but is also essential to our long-term
success. For details on our approach to due diligence,
please visit our dedicated Human Rights page.
Actions in 2023
This year, we have focused on strengthening our
foundations. We have:-e stablished a global governance structure responsible
for human rights-related issues;- included human rights as a standing agenda item at theGroup Sustainability Committee (GSC), and withinfunctional working groups;-c onducted a Human Rights Impact Assessment (HRIA)
with external experts;- r evised our Human Rights Policy and related internal
controls; and- developed a human rights training video for all employees.
PolicyOur Code of Conduct, Supplier Code of Conduct, Human
Rights Policy and various policies related to specificimpacts, set out our commitment to human rights, andthe expectations on all employees and suppliers.
The Human Rights Policy was updated inconsultation with expert stakeholders and approved by
the Group Management Board.
Governance
Our Representative Exec Officer, Exec VP/GCGO/GCFO,
oversees our Group human rights program. Our Heads of
Human Rights are responsible for day-to-day
implementation of our Group human rights strategy,
working closely with our Group functions teams to buildand embed capacity for the management of our humanrights impacts.
Human rights are a standing agenda item at the GSC
which meets quarterly. This year, the GSC reviewed ourGroup human rights strategy and the results of our HRIA.
The Group Human Rights Committee and dentsu
Japan Human Rights Education Conference cover Japanspecific issues. (Details)
Risks and impacts
We proactively identify global and market-level risks,
including real time alerts on social, environmental, andsecurity events, bi-annual assessments of the risk profilesof our markets, and our annual engagement survey.
To complement this, we appointed an external
expect agency to conduct a global HRIA. The results
inform our priority action areas.

Our most salient impacts include:- Equality and Non-Discrimination- Freedom of Thought, Opinion, Religion, Belief,
Expression and Access to Information- Labor Rights and Harassment- Privacy and Data Security- Child’s Rights- Right to a Healthy Environment

Grievance
We encourage all employees, suppliers and stakeholders
to raise any human rights concerns through our
externally operated, free, anonymous and confidential[Speak Up@dentsu] portal (p. 87).
Incidents
This year, serious allegations of human rights abuses
were made in the Japanese entertainment industry,
which we engage with. We are closely monitoring thestatus of remedy measures, and are increasing our due
diligence with this, in-line with our Code of Conduct,
Supplier Code of Conduct and Human Rights Policy.

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Environment and society
Working to realize a low-carbon society and make social contributions
toward truly sustainable corporate growth
create future possibilities.
In March 2024, the Dentsu Group Environmental
Policy was updated to reflect the updated 2030
Sustainability Strategy. For details, please see our website.

Yuko Kitakaze
Global Chief Sustainability Officer,
dentsuOur approach“Planet,” one of the core themes of our 2030
Sustainability Strategy, encompasses not only the
global environment but also society as a whole.
Maintaining a healthy planet is a key prerequisite for us
to provide value through our business. In addition to
reducing the environmental impact of our own activities,
we leverage our unique position, from which we cancollaborate with many stakeholders, including clientsand consumers, to proactively carry out activities that

Climate action
Climate action is one of the material issues included inour 2030 Sustainability Strategy. Climate change has
potential financial and societal impacts on dentsu andour stakeholders, including investors, partners, andclients. To achieve the goal of accelerating thetransition to a low-carbon and sustainable society, we
have set the following KPIs and will promote actionplans accordingly from 2024.
-A chieve net-zero greenhouse gas (GHG) emissions by
2040 (Scope 1-3)-A chieve a 46.2% absolute reduction in GHG emissions
by 2030 (Scope 1-3), compared to a 2019 baseline-A chieve 100% renewable energy* by 2030
-E
 nable 1 billion people to make more sustainablechoices by 2030
* Renewable energy in the context of dentsu’s sustainability strategy andcommitments refers to electricity generated from renewable sources. The
definition for renewable electricity has been aligned with RE100.

Our KPI to “Enable 1 billion people to make moresustainable choices by 2030” is linked to sustainableconsumption. In working to realize the transition to a

low-carbon society, our greatest opportunity is ourability to help shape consumer attitudes and behaviors.
We will advance businesses that contribute towards
these goals, including through business transformationand marketing support for clients.
2023 performance and future considerations
In 2023, we made progress on initiatives to expand thescope of our GHG reduction targets for our international
operations that were validated by the Science Based
Targets initiative (SBTi), to include the entire Group.
Based on our “Business Ambition for 1.5°C” commitment
letter from 2022, we submitted new GHG reduction
targets to SBTi in 2024, and these are still under review
as of July 2024.
We have also made progress in expanding our use
of Salesforce’s Net Zero Cloud platform to manage
GHG-related data on a Group-wide basis, aiming tocomplete this within 2024.
In 2023, through initiatives such as continuing totransition our company car fleets to hybrid and electricvehicles and switching to sourcing 100% renewableenergy for the Dentsu Building in Shiodome, Tokyo, our
Scope 1 and 2 emissions (market-based) were 46.2%
lower than in our baseline year.
However, when also considering Scope 3 emissions,which account for over 95% of our total emissions, our
Scope 1-3 emissions increased by 7.8% compared with59

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our baseline year. This was mainly driven by an increasein emissions under Scope 3 Category 1 (Purchased
Goods and Services). In 2024, we are launching a Groupwide Procurement Management Project to promote

initiatives to obtain high-quality data from our suppliers
and reduce emissions in our supply chains.
We increased our global renewable energy ratio
from 35.6% in 2022 to 55.3% in 2023, thanks to

GHG emissions (consolidated)

Scope 3

*1 The 2019 baseline figures are as ofDecember 31, 2023. We submitted new
GHG reduction targets to the SBTi
in 2024.

440,911374,884* RE100 is a global initiative for businesses committed to sourcing 100%
renewable electricity, and dentsu is a member of this initiative.

Renewable energy rate (consolidated)(tCO2e)408,846

initiatives towards our RE100-aligned commitment* toachieve 100% renewable energy by 2030.

393,494

422,65146.2％ decreasevs. baseline*2 Each consolidated figure for Scope
1+2+3 emissions for 2023 has received
independent limited assurance fromKPMG AZSA Sustainability Co., Ltd.
*3 Scope 2 emissions are calculated using
the market-based method.
*4 Emissions from Tag Worldwide Holdings
Limited included in footprint from 2023.

377,456

(％)
100

100

Target

100％

80

60

53.5

55.3

48.7

40

35.6
20

0

2020

Scope 1+2*1, 2

33,962
2019(baseline)

16,0392022

18,2612023*3, 42030(target)

(FY)

2021

2022

2023

2030

(Year)

Note: Renewable energy percentages are calculated in line with RE100
criteria. For data on the renewable energy ratio based on the amountof renewable energy sourced, please refer to the ESG Data Book.
Renewable energy data is outside the scope of independent assurance.

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Disclosures based on the TCFD recommendations
Climate action has been identified as a material issue inour sustainability strategy, and we are working toproactively mitigate risks and seize opportunities arisingfrom the transition to a low-carbon economy.
As part of our commitment to Climate Action, we
conduct scenario analyses guided by the Taskforce on
Climate-related Financial Disclosures (TCFD)
recommendations. These analyses are crucial in
identifying, assessing, and managing the impacts ofclimate-related risks on our operations and strategy. By
examining various potential future climate scenarios, we
better understand the uncertainties and risks associatedwith climate change, including extreme weather eventsand regulatory changes.
The insights from these analyses are integrated into
our governance and decision-making processes,
embedding climate-related considerations at every levelof our organization.
This year’s TCFD report offers a comprehensive
overview of our scenario analyses, governanceintegration, and strategic alignment, reflecting ourproactive approach to managing climate-related risks
and dedication to a sustainable future. For further
details, please see the Dentsu Group TCFD Report 2024.
Nature-related initiatives
For dentsu to continue creating value for society overthe medium to long term, maintaining a healthy naturalenvironment is essential. Based on the global vision set
out in the Kunming-Montreal Biodiversity framework of“living in harmony with nature by 2050,” in 2023 we
conducted a high-level assessment of our dependencies
and impacts on natural capital across our global value
chain for key business areas based on therecommendations of the Taskforce for Nature-related
Financial Disclosures (TNFD)*.
Although the results of this high-level assessment
found relatively low dependencies and impacts onnature, we identified several areas in our upstream value
chain where we could make positive impacts for nature.
We also identified opportunities to make an even greater
contribution through the development of solutions that
support nature positivity by leveraging our industry’s
characteristics of having contact with diverse clientcompanies and partners to encourage sustainablebehaviors, as well as by generating future-oriented ideas
for society that go beyond our value chain.
Based on these assessment results, dentsu willcontribute towards nature through the following initiatives:- Including considerations around GHG emissions, nature,and related stakeholders in our procurement policies
 ormulating business guidelines that consider nature-Fand the global environment, and creating ecosystems
to realize them-R
 educing water usage and waste in our operations- Providing programs and opportunities for employees tobetter understand and appreciate the value of nature- Developing and offering solutions that help our
corporate clients become more nature positive- Raising awareness through activities that encouragesustainable consumption, including nature
positive aspects* The TNFD has developed a set of disclosure recommendations and guidance
that encourage and enable business and finance to assess, report, and act on
their nature-related dependencies, impacts, risks, and opportunities. In March
2024, dentsu joined the TNFD Forum, an international group of institutional
supporters who share the vision and mission of the TNFD.

Learning and development
Raising awareness and upskilling our employees onsustainability is a key priority for us.
In 2023, we rolled out new modules on the businesscase for sustainability and our sustainability strategy on
dentsu university, our employee learning platform, whichwere completed by more than 1,000 employees globally.
We supported 100 leaders from across the business tocomplete an intensive eight-week course from theCambridge Institute for Sustainability Leadership (CISL)
on Sustainable Marketing, Media, and Creative.
In all four regions, local initiatives are growing toincrease awareness of our sustainability strategy and growour people’s knowledge in this area through regular townhall
meetings and employee engagement opportunities.

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In Japan, we rolled out the Sustainability Leaders
program, regularly reaching more than 700 employees
monthly with insights about the latest internal andexternal themes. In Denmark, we piloted our very first
Sustainable Marketing Academy, which is open to ouremployees as well as external parties, including clients,
and we have also developed our own education
programs in the Netherlands and the UK, currently for
employees only. Key training topics include businessunderstanding and strategic insights, greenwashingcountermeasures, and carbon reduction.
Initiatives towards industrial transformation
Our goal of realizing a vibrant society where people
enjoy a fulfilling life cannot be achieved through theefforts of a single company alone. As a responsible
corporate citizen with operations spanning the globe
and a leader in our field, we will accelerate industry
collaboration and contribute to solving social issues
by creating and participating in a variety of crossindustry initiatives.
Initiative 1. Decarbonization Initiative for Marketing
In 2023, dentsu launched the Decarbonization Initiativefor Marketing to promote GHG emission reductions in
supply chains related to marketing communications inJapan, while ensuring compatibility with global
standards and involving all relevant stakeholders. We

signed a memorandum of understanding with AdGreen, ageneral incorporated association that provides carbon
visualization tools in the advertising production field in
the UK, and we will also respond to the requests ofcompanies conducting marketing activities globally.
Initiative 2. Opening of FACTORY ANZEN STUDIO,
photography studios with sustainability in mind
Aiming to decarbonize creative production, Dentsu
Creative Cube opened two next-generation
photography studios called FACTORY ANZEN STUDIO in
2024. In addition to reducing our environmental impact
by sourcing 100% renewable energy* and recycling
waste from filming (targets: 90% recycling rate by 2025with a longer term ambition to achieve 100%), thestudios are also compatible with dentsu’s proprietary
Carbon Calculator for Movie Production, a tool for
calculating and visualizing emissions in creative

One of the two studios uses virtual production. By projecting a
background image on an LED panel and combining it with the subject
to create a video, we are able to reduce emissions associated with set
disposal and location shooting.

production, making it possible to analyze and reduce
emissions in production. For details, please see thestudio website.
* The studios source an equivalent of 100% renewable energy, achieving zerocarbon emissions from electricity usage. New solar panels are scheduled to beinstalled on the rooftop in the summer of 2024.

Initiative 3. Production and free release of Sustainability
Communication Guide 2023
We recognize greenwashing(making it appear as if acompany/organization ismaking more environmental
efforts than it is) as a climaterelated business risk not only for our company, but also
our entire industry, presenting a major challenge. We
created the Sustainability Communication Guide 2023 asa reference for employees to keep in mind when carryingout their work, free of charge for companies and otherorganizations in Japan.
For details, please see the website.
Strategic collaboration with external stakeholders
We aim to utilize the knowledge gained throughcollaboration with external stakeholders in our Group’s
management to improve our response to sustainability
issues such as climate change.

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For the tenth consecutive year, dentsu has been
selected as a Strategic Partner of the World Economic
Forum (WEF), an international organization that works to
improve circumstances globally through cooperation
between the public and private sectors, and we support
the organization’s activities.
Furthermore, as a member of the Alliance of CEO
Climate Leaders, a community facilitated by WEF, aheadof COP28 (28th Conference of the Parties to the
Framework Convention on Climate Change) held in
November 2023, our President & Global CEO signed an
open letter calling on world leaders to scale theirclimate ambition.
Since 2021, dentsu has continued to be a memberof the World Business Council for Sustainable
Development (WBCSD). We were founding members of
the Business Commission for Tackling Inequality, whichin 2023 released a report, Tackling Inequality,
highlighting this issue as a systemic risk and laying out aroadmap for private sector action. The report can beaccessed via the following link.
In July 2023, we became a Supporting Member of
the Japan Climate Leaders’ Partnership (JCLP), a
coalition of Japanese companies aiming for asustainable, decarbonized society. As an Associate
Member from April 2024, we will help lead the way to a
decarbonized society from an industrial perspective.
We also expanded our work with Ad Net Zero, a

global program that supports the advertising industry inaddressing the climate crisis, decarbonizing advertising
activities, and promoting sustainable products andservices. Dentsu is a founding member at the global
level and a local member in the US, the UK, New
Zealand, and the UAE.
Contributing to society
For dentsu, as a B2B2S company, society is positioned as
key stakeholder, and we aim to contribute to society
through each of our corporate activities. We strive torealize a vibrant society where people enjoy a fulfilling
life not only through our business, but also throughsocial contribution initiatives, to enable stable businessactivities and value provision.
Initiative 1. One Day for Change
One Day for Change is a global activity as One dentsu
that enables our people to unite as a force for good in
our communities. In 2023, more than 9,000 employees
from 63 countries participated, spending over 34,000
hours engaged in sustainability-related activities. This
event succeeded in more than simply raising awarenessof sustainability topics. In a survey of 1,000 participants,
95% reported improvements to their well-being, while
86% said that they felt closer to their colleagues andlocal communities as a result.

Initiative 2. Providing skills to the next generation
We are committed to empowering the next generationof responsible, ethical, and digital citizens. We reachedmore than 12,000 beneficiaries in 2023 throughinitiatives including our Global Schools program, The
Code, and other learning programs worldwide inpartnership with universities and high schools. We
support young people outside of school programs byproviding digital marketing courses free of charge inpartnership with major universities, including Howard
University in the US, to bring the latest thinking andinnovation to more young people. In the UK, we developed
and rolled out a new program for The Code in 2023 thatteaches sustainability to secondary school students.

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Initiative 3. Activities towards eradicating malaria
Since 2017, dentsu has been working to eradicate
malaria, which is seeing a rapid increase in infections due
to an increase in mosquito populations driven by climatechange. In 2023, ahead of COP28 in Dubai, we supported
Malaria No More UK, a charity working to eradicate
malaria globally, with the launch of a new campaign
called “Zero Malaria: Change the Story.” We secured
more than 582,000 USD in pro-bono media value in 11
markets and reached more than 65 million people.

Initiative 4. Advertising Elementary School
In 2006, Dentsu Inc. launched the Advertising
Elementary School program, jointly developed with
Tokyo Gakugei University. This program was conceived
by an employee who asked themselves, “What can wecontribute to society as an advertising company?” As of
March 2023, it has been offered to approximately 450

schools, from elementary schools touniversities, for a total of over
61,000 students. This programcultivates basic communication
skills, such as the ability to think,judge, express, and solve problems ina group through the creation ofcommercials, and it has also been
published as a book. Please see the special website
for details.
(Available in Japanese only)
Initiative 5. Communication Tips to help improve PR skills
for Nonprofit Organizations (NPOs)
In 2004, Dentsu Inc. and Japan NPO Center, anintermediary support organization for NPOs in Japan,
established the NPO Public Relations Skills
Improvement Committee. Utilizing the creative power ofdentsu and the Japan NPO Center’s network, wedeveloped the Tips for Communicating program andoffered it to NPOs across Japan. This initiative, whichcelebrates its 20th anniversary in 2024, has held over
150 seminars across the country, with a total of over
5,700 participants. For more information, please visit theJapan NPO Center website.

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Governance
Enhancing corporate value through better corporate governanceArinobu Soga

Tim Andree

Director, Representative Executive
Officer, Executive Vice President,
Global Chief Governance Officer &Global Chief Financial Officer,
dentsu—Please tell us your thoughts on how improving
corporate governance (CG) can lead to increasing
corporate value.
Tim All stakeholders have expectations of good
governance, and the Board of Directors considers
meeting shareholders’ expectations to be our primary
responsibility. I believe that the best way to take care ofshareholders in the long term is to take good care of
employees, to take good care of clients, and to takegood care of society.
With regard to CG, in recent years, especially since2016, we’ve focused a great deal on the structure of the

Non-Executive Chairman of
the Board, dentsu

Board and have evolved it rapidly. We now have a Board
that is a majority of independent outside directors, wehave transitioned to a company with three committees,
which is very consistent with global standards for good
governance. The Group has also created a new positionof Global Chief Governance Officer to appoint an
executive responsible for achieving CG improvements
throughout the organization.
I want to emphasize that it’s not the outside
directors that are coming in and imposing this. This issomething that dentsu management has been actively
engaged in to address the questions of “how can we

improve our CG?,” and, “how can we give ourshareholders more confidence in our ability to supervise
and oversee and manage the company?” From goodstructure, we can build good governance.
But then it must lead to effective practices. And I
think that’s the stage we’re at now, which is how to takethis improved structure and implement it into enhanced
practices that allow us to better deliver for all our
stakeholders, including shareholders, to better
implement effective risk taking to help the organization
not only feel more comfortable with risk, but also to
avoid any unnecessary risks.

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Soga CG is a “system” that a company has in place.
Specifically, as stated in the CG Code of the Tokyo Stock
Exchange, it is a mechanism that encourages“transparent and fair” and “prompt and decisive”
decision-making by the Group and its management
team, and is essentially a mechanism to maximize theGroup’s output in terms of quality and quantity. As statedin our Value Creation Model, there are expected outputs
for the various capital inputs that the Group has, andbetween the inputs and the outputs there is a process ofdecision-making and action.
CG is not at all something that has a negative
impression, such as regulating employee actions, but it issomething that is completely positive.
Tim I totally agree. People can misunderstand CG as

simply compliance or rules, or frameworks andrestrictions. What you’re not allowed to do. CG, in myview, is the way of doing the things that you do in aconsistent pattern to get the maximum output. There’s aprocess of recognition, acceptance, escalation, and thenresolution so that the organization continues to improve.
Clarity of accountability is a product of good
governance. It’s very hard to be a well-run, highperformance organization without it.

Improving CG as One dentsu—How can we work as One dentsu to improve CG?
Soga I believe that the most important thing for theevolution of CG as One dentsu is for everyone to want
the same thing: to create a good system.
Tim I think for dentsu, the One dentsu Operating Modeland the One Management Team are effective
enhancements of CG, and they need to be implemented
well because they’ll give much better clarity of roles andresponsibilities across the business.
The thought is, as Soga-san said, implementing a
way of doing things consistently. If everyone knows what
those standards are, it allows you then to implement the
PDCA cycle for continual improvement because you cansee what the deviations are. As the organization has
become bigger, more complex, more multicultural, andmore multinational, these are areas of focus andimprovements that will pay great dividends.

Adapting to changes and thewillingness to keep learning—How can we help employees properly understand thebenefits of improving CG and make it personal to themselves?
Soga It is necessary to first understand that CG is not atightening of controls but a mechanism to maximize
corporate value, and then to create a common
understanding based on appropriate communication.
In addition, training is not only necessary for CG. I
believe that it is a prerequisite for employees of dentsu
to constantly seek out new things and be open toaligning with changing values and society.
Tim Any compliance issues come at a great cost,
impacting our reputation and trust from our stakeholders.
In the future, it is the responsibility of us all to
improve our CG. It’s not just a responsibility to stay incompliance, but to also recognize and speak up if
employees observe something that’s a little off.
I think it’s a very good thing that management isprioritizing CG since our stakeholders expect us to takeit seriously, and we’d like employees to understand that.
If we can all take this as an opportunity to evolve
our culture around a common set of values that are
driven by good governance, it will help stimulate higher
performance in a consistent and sustainable way.

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GovernanceI think communication is important, and I think it’s
the responsibility of management to effectively
communicate both the importance of CG and its
practical implementation.
In addition to communication, I think it’s a matter ofseeing the tone from the top in action; in management’s
behavior. It’s a matter of how they observe leaders’consistent and proper actions.
Soga In the dentsu Leadership Attributes, we have alsoorganized what you need to know as a leader in ourcompany. It is important to create a learning culture andappropriate content.
The pillar of human capital management is thedevelopment and growth of employees, and Human
Capital Development is one of our material issues.
It goes without saying that strong and continuous
communication from top management is important inencouraging employees to understand CG and take action
on their own. We believe that it is also necessary to instill
the importance of CG through the HR system and othercompany systems so that employees will be encouraged toact accordingly. For example, by providing comprehensive
training programs and fostering a learning culture, I believethat employees will be more willing to learn.
Tim We should also note that Board members docompliance training as well. We all did the Code of
Conduct review and I think that’s a sign of integrity thatit’s disseminated throughout the whole organization, andan effort to reinforce how important the issue is.
It is important that our shareholders benefit fromgood CG, that our company is attractive to them, andthat we build confidence in their investment. I want ouremployees to have the same awareness of theimportance of our stakeholders. This means thinking
about how to build confidence with each other, how tobuild confidence with clients, and how to build
confidence in our impact on society with appropriate
promotion of DEI, work life balance, and more.
It is essential that all employees at every level
recognize these opportunities for establishing the proper
way and, if that is somehow violated, that they escalate
at speed.

Toward a culture of
integrity as a priority—The first of dentsu’s material issues is Business ethics& compliance / Data security. What are your thoughtson this?
Tim The Materiality as it relates to ethics andcompliance and items such as data security and cybersecurity, simply identifying that list of risks alone showsthat times are changing. There is much more challenging
complexity in marketing and advertising, and newfrontiers are coming. Emerging technologies such as
generative AI could create conflicts of interest or evenshape our purpose in how we serve clients.
Based on our growing responsibilities and purpose
around these new areas, to build trust with our
stakeholders, we must do what we say we’re going to do.
Soga This is not to say that our traditional approach ofworking for our client’s success is in itself a bad thing.
It is important to always be aware of the Dentsu
Group Code of Conduct when conducting business.
I am talking about having a sense of values that weshould have always had, and understanding the Dentsu
Group Code of Conduct well.
Business ethics is an important value for us.
Changing our values and culture will take time, but I am
determined to instill a corporate culture that placesbusiness ethics and integrity at the top of our values.

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GovernanceMaterial issues related togovernance: Business ethics &compliance / Data security
Establishing and improving the management foundation
to address this material issue is extremely important for
the Group in earning stakeholder trust. The Sponsor isRepresentative Executive Officer, Executive Vice
President, Global Chief Governance Officer & Global
Chief Financial Officer of dentsu Arinobu Soga. In
addition, executives including Global General Counsel
Alison Zoellner and Global Corporate Secretary &Deputy Global General Counsel Tadashi Nagae havebeen designated to lead on specific themes.
To bring shape to this material issue, we set aheadline goal and organized processes to reach it. We
also formulated individual action plans and KPIs
related to training, contact points, and third-party
evaluations, which can each be measured andvisualized in the process.
In addition, we will proceed with overall measures
to improve our corporate environment. Progress will bemonitored continuously, and reports will be submitted
regularly to the Group Sustainability Committee.

Headline Goal

Putting integrity firstAs a B2B2S enterprise, we aim to equip our people with the correct knowledge andhave the appropriate systems in place for them to be putting integrity first in their work.

Themes●Business ethics & compliance●

Data privacy●

Risk management●

Corporate governance●

Cyber security●

Human rights

Item

Individual
measures

Measure

KPI

1. Training

Establish a common
training environment

100% of employees receive training

2. Contact points

Develop skills for key contact points

Contact points and experts
established for issue areas

3. Third-party
evaluations

Conduct stakeholder dialogue
and information disclosure

Acquire certifications
and improve ratings

Note: T
 o see how this materiality relates to the 2030 Sustainability Strategy,
see p. 24.

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GovernanceCorporate governanceCorporate Governance Evolution
2016- Transitioned to a company with an Audit and Supervisory Committee- Started BoD Effectiveness Evaluations

2019- Established Nomination and Compensation Committee(Chairperson: Independent Outside Director)- Introduced Performance-based Stock Compensation Plan

2020 - Transitioned to a pure holding company structure- Clarified the skills for Directors

2021- Established Succession Plan

2022 - Separated the roles of chairperson of BoD (non-executive director) and CEO- Reached majority non-executive directors

2023 - Transitioned to a company with three committees and One dentsu- Appointed Chief Governance Officer- Published ESG Databook and held ESG Briefing

General Meeting of Shareholders
Appointment/Dismissal

Appointment/Dismissal

Report

Audit

Election/
Dismissal

Determination of
the proposal for
appointment/
dismissal

1 Nominating Committee
Cooperation
Audit(1) To respect shareholders’ rights and ensure their equal treatment(2) To consider the interests of stakeholders, including shareholders,and cooperate with them appropriately(3) To appropriately disclose company information and ensuretransparency(4) To enhance the effectiveness of the supervisory function overbusiness execution(5) To engage in constructive dialogue with shareholders who havean investment policy that conforms to the medium- to long-term
interests of shareholders

Supervision

Independent Auditors

The Group realizes effective corporate governancebased on the following basic policy to fulfill its
responsibilities to its stakeholders including
shareholders, clients, employees, and consumers, toensure sustainable growth, and enhance its corporate
value over the medium to long term.

Corporate governance structure

Report Report
Cooperation

Appointment/Supervision/Delegation

Business Execution

Group M&A Committee
Group Sustainability Committee

3 Group Management Team

Audit Committee
Compensation Committee

2 Board of Directors

Determination ofcompensation
ReportGroup Internal Audit

Group Management Board

Group Human Rights Committee

Representative Executive Officer

Group Compliance Committee

Delegation

Group Risk Committee

Executive Officer

Group Nomination Committee

Audit
Governingdentsu Japan

1 Adoption of a board committee structure withthree committees

The Group’s Board of Directors decided to adopt a board committee
structure with three committees as a framework for fulfilling its
important role and responsibility to strategically guide the Group inaccordance with its purpose and vision.
2 Roles of independent outside directors

Independent outside directors are expected to contribute toimproving corporate governance, encourage insightful discussions in
the Board of Directors by raising pertinent issues and opinions, andhelp the Board reach sound decisions by expressing viewpoints
reflecting their respective fields of expertise.
Independent outside directors also play a part in verifying andevaluating operational results and management performance indentsu EMEA

dentsu Americas

Group Companies

Group Compensation Committee
dentsu APAC

view of the management strategies formulated by the Board.
Moreover, they help assess whether management is carrying out its
duty to deliver shareholder returns.
3 Framework to ensure sound, effective,

transparent management

The Group aims to increase its value by clearly separating
management supervision and business execution; facilitating swift
and decisive management decisions regarding business execution;and delegating a high level of authority over business execution
away from the Board of Directors to members of the GroupManagement Team, which includes executive officers.
For more information, please refer to the Corporate Governance Report on
our website:
https://www.group.dentsu.com/en/about-us/common/pdf/governance_202403_en.pdf

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Board of Directors (held 14 times in 2023)
Chaired by a non-executive director, as of March 28,
2024, the Board of Directors comprises nine directors, ofwhom six are independent outside directors. The
independent outside directors include members who
have management experience at other companies.
When selecting the Board’s members, consideration
is given to ensuring a sound balance of experience,expertise, and skills, as well as diversity in terms ofgender, nationality, professional background, and age.
The following initiatives involving the Board werecarried out in 2023.

Nominating Committee (held 10 times in 2023, one timeas the ex-Nomination Advisory Committee)
The Nominating Committee comprises four members,
including a chairperson with voting rights. Among thethree other members, two are independent outside
directors and one is an internal director.

- Meetings between Board members including
independent outside directors and global leadershipteam members were held at dentsu’s New York office- Unofficial meetings were conducted four times toallow for deeper discussions on important issues- An ESG Briefing was held for institutional investors- Independent outside directors attended employee
information-sharing meetings and answered questions• Actions and results
The Nominating Committee deliberates on thenomination and succession plans of directors andexecutive officers, and decides on matters related todirectors. Matters related to executive officers aredeliberated and reported by the Committee before
being submitted to the Board of Directors for decision. In
2023, it mainly deliberated on the following matters.
-T he Nominating Committee’s role, operating policy,
and main topics of discussion-P olicies concerning director nominations andsuccession planning-P olicies concerning executive officer nominations andsuccession planning•M ain topics of agenda items in meetings of the Board of Directors
Compliance, internal controls, risk management,sustainability and ESG strategies in view of dentsu’slong-term vision and Medium-term Management Plan,
Group competitiveness, business portfolio, the Mediumterm Management Plan, investment in human capital, etc.

• Policies concerning nomination and succession planning
1. Nomination policy
The Committee shall:-N ominate suitable candidates who can contribute toenhancing the Group’s value and sustainable growthover the medium to long term, in view of the Group’s

operating environment.
- Select candidates with management-related expertise,
experience, and ability, while ensuring a good balance
between diversity and fields of expertise with the goalof assembling a management team capable ofimproving the Group’s competitiveness and quickly
generating innovations.
- Select candidates to become the Company’s directors
and executive officers in 2024.
2. Succession planning policy- The Committee shall prepare succession plans for theCompany’s directors and executive officers.
- The Committee shall consider successor candidates
for each position or set of positions, based onpriorities and requirements that reflect the Group’s
operating environment.
- Discussions regarding human resources (People
Discussions) shall be held in all relevant workplacesby executive managers in order to identify promising
successor candidates and give consideration topersonnel development plans, which process willallow for committee deliberation based on thescreened information.
- In addition to selecting and training successors from within
the Group, depending on the management position, theCommittee shall expand the pool of successor candidates
by recruiting people from outside the Group.

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Audit Committee (held 14 times in 2023, four times as
the ex-Audit & Supervisory Committee)
Chosen by the Board of Directors, the Audit Committee
comprises four independent outside directors, three ofwhom have expertise in finance and accounting. The
chairperson is selected by the committee from among
the members.
• Actions and results
In accordance with the Companies Act of Japan, theCommittee audits the execution of duties performed bydirectors and executive officers, supervises the activitiesof the Board of Directors, and, as a basic policy, assists
the Board in its supervisory role by monitoring andsupervising financial reporting, internal controls, internal
audits, and financial audits.
Having taken over the auditing duties of the former
Audit & Supervisory Committee, the Audit Committee
verified the audits conducted by that committee
between January 1 and March 30, 2023 (the date of theGroup’s 174th Ordinary General Meeting of
Shareholders). Key audit matters for the Audit
Committee are the following.
-C onstruction and operating status of the system ofinternal controls (including internal controls
associated with financial reporting) he organization and execution of the Group’s internal audits-T- The appropriateness of audits by the accounting

auditors (including organizations that audit
consolidated financial results outside Japan)- Initiatives to strengthen the compliance framework(including measures implemented by the dentsu Japan
Reform Committee in response to issues related to theTokyo 2020 Olympic and Paralympic Games)
Compensation Committee (held 11 times in 2023, threetimes as the ex-Compensation Advisory Committee)
The Compensation Committee comprises threemembers: a chairperson with voting rights and two
independent outside directors.
• Actions and results
The Committee deliberates and decides on thecompensation of directors and executive officers. In
2023, it mainly debated the following matters.
- The Compensation Committee’s role and operating policy-R eviewing of basic policies concerning officer compensation- The review of market benchmarking methods forofficer compensation-E stablishing targets for performance indicators andevaluation methods-S etting individual performance targets for executive
officers and interim reviews• Basic policies on executive compensation
1. T he Group shall recruit and retain highly capable

personnel by providing attractive compensation andworkplace conditions.
- Competitive levels of compensation- Opportunities for career advancement
2. The Group shall aim to maximize the performance of
the Group Management Team of globally-integrated
management to achieve Group-wide strategic goals.
- Performance-based rewards- Ambitious goal setting
3. The Group shall promote mutually beneficial relationships
with stakeholders, starting with shareholders.
- Creating value for society- Accountability
Other bodies involved in business execution
Under the Board of Directors, the Group Management
Team directly oversees the Group’s four regions ofoperation. Among the team members, the President &Global CEO and three vice presidents make up the GroupManagement Board, which was set up as a businessexecution body that holds deliberations (including prior to
Board of Directors’ meetings) and makes decisions onimportant matters concerning budgets, financial results,
dividends, earnings forecasts, M&A and investmentrelated issues, medium-term management plans, key
personnel, and the establishment and revision ofimportant rules and regulations.
Further, the Group M&A Committee, Group71

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Sustainability Committee, Group Compliance Committee,
Group Risk Committee, Group Nomination Committee,
and Group Compensation Committee are advisory bodies
that deliberate on specific issues. This framework is
designed to ensure sound, transparent, and effective
management, and to contribute to enhancing the Group’s
corporate value over the medium to long term.
Training for directors
To ensure they properly perform their roles and carry out
their responsibilities, directors are regularly provided
with training and opportunities to acquire knowledge
essential for performing their duties. When outside
directors are appointed, they are provided withinformation on the Group’s businesses andorganizational structure, followed by regular
opportunities to learn about specific issues andchallenges facing the Group’s businesses. In 2023,
directors participated in training programs covering
compliance, geopolitical risks, and sustainability,
particularly with regard to decarbonization.
Policy on the disposal of strategic shareholdings andactual reductions
The Group’s basic policy regarding so-called strategic
shareholdings is to validate whether shareholdings aremeaningful from perspectives such as whether the
benefits of holding the shares are higher than theGroup’s anticipated cost of capital and whether thestock ownership contributes to the maintenance andenhancement of the business relationship with theinvestee company and the promotion of collaboration,and to reduce individual shareholdings where they are
not deemed meaningful.
Each year, the Board of Directors examines the
purpose and economic rationale for every strategic
shareholding from a medium- to long-term perspective
and assesses the appropriateness of continuing to holdeach stock.
In 2023, the Group sold 17 strategic shareholdings
with a total value of approximately 13.0 billion yen inaccordance with this policy.
As of December 31, 2023, the ratio of the amountof strategic shareholdings on the balance sheet to theGroup’s total equity was 9.2%.
Constructive dialogue with shareholders
The Group recognizes that regularly engaging inconstructive dialogue with shareholders and investors
can contribute to enhancing its corporate value over the
medium to long term.
Therefore, the Group has established a Disclosure
Policy and discloses to shareholders and investors a
broad scope of information in a timely manner throughits investor relations activities, spanning frommanagement strategies and financial results to non-financial matters.
Specifically, a wide range of activities are carriedout primarily by the Global CEO and the Global CFO,
along with executive officers in charge of investor
relations and information disclosure. The activities
include periodic meetings with securities analysts andinstitutional investors, participation in conferences heldby securities firms in and outside Japan, investor
roadshows to meet individually with investors around theworld, conference calls and video meetings withindividual investors, as well as the issuing of detailed
announcements on the Group’s website.
To ensure these activities are effective, the GroupIR Office functions as a specialized organization, andworks closely with related organizations, including theGroup Corporate Planning Office, Group Financial
Reporting Office, Group Financial Planning and Analysis
Office (accounting function), and Group Corporate
Secretary Office. With locations in Tokyo and London,
the Group IR Office engages in dialogue with securities
analysts, investors, and shareholders from Japan andother countries.
The opinions and requests of shareholders andinvestors obtained by this management team directly
through meetings and other investor relations activities
are periodically reported back to the Board of Directors
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Governanceshareholder value.
In addition, to properly handle insider information,
the Group has set up an Information Management
Committee, and also prohibits external discussions
about financial information during silent periods. Efforts
are also made to verify the Group’s shareholder
ownership structure, including periodic surveys toidentify shareholders with substantial holdings, theresults of which are reported to the Board.

Independence of outside directors
As a matter of policy, the Group limits the number of
directors on its Board of Directors to a maximum of
15, and of that total, a majority must be independent
outside directors. The Board currently comprises nine
directors and, to enhance its supervisory role, theGroup has appointed six independent outside
directors who meet its standards for independence,as well as a non-executive director who functions as
Chairman of the Board.
For further details regarding dialogues with shareholders and investors, pleaserefer to the Disclosure Policy section of the Company’s website.
https://www.group.dentsu.com/en/ir/stockandratings/constructivedialogue.html

Evaluating Board effectiveness;measures taken in 2023
Aiming to continuously increase the effectiveness of its
Board, the Group has appointed a third-party organization
to independently analyze and evaluate how effectively
and appropriately the Board performs its management
supervisory role, and has each director complete anannual questionnaire about the Board’s effectiveness.
In 2023, the Group confirmed that issues identified
in the 2022 evaluation had improved, while new tasks andfuture plans were making progress. It thus implemented
measures to increase the Board’s effectiveness, in effort
Evaluation method for 2023

to further improve corporate governance.
Results of analysis and summary of evaluation
In response to the Tokyo 2020 Olympic and Paralympic
Games incident that occurred in 2022 and the financial
issue in the DACH region, we recognize with a sense ofurgency that strengthening internal controls andtransparent disclosure are essential to restore
stakeholder confidence and enhance corporate value.
• Summary of 2023 evaluation results, issues from 2022
and progress in 2023
The evaluation for 2023 confirmed the sincere efforts ofNovember 2023

November–December 2023

January 2024

SurveysConducted for all directors andsome members of the GroupManagement Team.

Third-party interviews
Conducted for all directors andsome members of the GroupManagement Team.

Opinion exchange meeting
Conducted for all directors.

Items in the survey (11 items, 76 questions)- Overall evaluation (effectiveness as a whole,functioning of the monitoring model after the change
in institutional design, transparency, fairness, andrationality of decision making)- Strategic alignment and engagement (management
strategy, capital policy, business portfolio review,
ESG response, business risk, dialogue withshareholders, etc.)- Board of Directors’ processes and practices (board
management, organizational design, discussion topics,
training, etc.)- Management supervisory functions (monitoring ofbusiness activities, risk management, global
governance systems)- Board culture and dynamics, Nominating Committee,
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Governancethe Board of Directors to upgrade its corporate
governance structure in order to regain the trust of
stakeholders. Among other things, the evaluation
confirmed the high regard for the open and active
discussions at the Board meetings, the time andemotional commitment of each Board member, and theleadership of the Chairman in fostering a forwardlooking culture. On the other hand, it was also confirmed
that, in light of the high number of risk incidents and theinability to halt the deterioration of businessperformance, it will be necessary to take measures to
get to the root causes of the problems and to reconsider
the monitoring of execution. The status of efforts toaddress issues 1 through 4 below, which were identified
in the analysis and evaluation for 2022, and the Group’s
recognition of this status are as follows.
1. D eliberation on important agenda items and thedetermination of direction based on the long-term
vision and strategies
While reviewing progress towards the Medium-termManagement Plan, it was confirmed that the executiveside presents specific considerations regarding thelong-term vision and strategy to the Board of Directors,
and careful and active discussions are held at the Boardof Directors’ meetings.
 stablishment of common frameworks for
2. E
effective monitoring
It was confirmed that while under the new board

structure, efforts are being made to align the point ofview of supervisory and executive sides of the Board, theappropriate sharing of management information with
the Board and the establishment of a method formonitoring execution by the Board remain issues that
require ongoing efforts.
3. C
 onsideration of the approach to monitoring after thetransition to One Management TeamIt was confirmed that although the formalities related to
the One dentsu Operating Model are in place, PDCA
management to strengthen the operations is importantin order to ensure its substantive aspects.
 onsiderations regarding changes to
4. C
organizational design
It was confirmed that although the change in theorganizational design (from a company with an audit andsupervisory committee to a company with a nominating
committee, etc.) and the transition of the management
structure went smoothly, it is necessary to keep in mind
that transition is not a goal, and efforts should be madeto strengthen the substantive aspects of operations,
including internal controls and internal audits.
• Initiatives for future improvement
The issues to be prioritized by the Board of Directors andthe policy for addressing each issue are as follows, inorder to achieve the operation of One dentsu with bothsupervision and execution, and to lead the entire Groupto sustainable growth and increased corporate value
while solving the issues at hand.
1. Establishment of a Group Global
Governance Structure
Our policy for initiatives: In order to promote theappropriate operation of One dentsu and theestablishment of a structure, secure global humanresources to support the global headquarters functions,strengthen internal controls, and effectively promote
Mindset and Behavior Reform.
2. Accelerate strategic discussions on businessportfolio optimization
Our policy for initiatives: In order to promote strategic
divestiture and portfolio optimization of businesses, theBoard of Directors will discuss the progress of past M&A
and business restructuring.
3. Strengthen monitoring of execution by the
Board of Directors
Our policy for initiatives: Align the perception ofsupervisory and executive sides on the roadmap andmilestones for addressing execution issues, clarification
of KPIs to be monitored, and the content and methodsof reporting at Board meetings.
4. Improve quality of materials suitable for discussion at
Board meetings
Our policy for initiatives: Examine ways to prepare andpresent materials suitable for discussion from asupervisory perspective at Board meetings.

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Board member skills matrix
Official position

Tim Andree

Director, Chairman of the Board

Hiroshi Igarashi

Director,
Representative Executive Officer,
President & Global CEO

Arinobu Soga

Director,
Representative Executive Officer,
Executive Vice President
Global Chief Governance Officer, Global CFO

Gan Matsui

Independent Outside Director

Paul Candland

Independent Outside Director

Andrew House

Independent Outside Director

Keiichi Sagawa

Independent Outside Director

Mihoko Sogabe

Independent Outside Director

Yuka Matsuda

Independent Outside Director

Committee
membership

Businessmanagement

Finance/
Accounting

Audit

Legal/Compliance Human resources

Globalmanagement

Digital business

Nominating

Nominating
Audit, Chair
Nominating
Compensation
Compensation,
Chair
Nominating, Chair
Audit
Audit
Compensation

Audit

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Messages from theCommittee Chairs
Dentsu recognizes the importance of improving corporate
governance to enhance the Group’s corporate value andachieve sustainable growth over the medium to long term.
Accordingly, it adopted a board committee structure withthree committees (nominating, audit and compensation)in March 2023. This structure was established to facilitate
prompt decision-making and enhance the Board of
Directors’ transparency and management supervisory roleby clearly separating business execution andmanagement supervision.

(From left) Tim Andree, Non-Executive Chairman of the Board; Gan Matsui, Chairman of the Audit Committee; Keiichi Sagawa, Chairman of the Nominating Committee;
Andrew House, Chairman of the Compensation Committee

Advances in Group-wide business integrity

Gan Matsui

Independent Outside Director
Chairman of the Audit Committee
With its adoption of a board committee structure in
March 2023, dentsu established three new committees,
made up primarily of independent outside directors as
mandated by Japanese law. As a result, the Group has
evolved, and its corporate governance is now more solid
than ever. Of the new committees, the Audit Committee
has greater responsibility than the former Audit &Supervisory Committee; this requires it to maintain astrong focus in its activities.
Alongside this change, the Group began taking newsteps regarding its One dentsu framework in 2023. One
dentsu aims to succeed not only in business, but also in
business-to-business-to-society (B2B2S). This means
earning public trust, aiming to be a company that
benefits society, and always considering the societal
aspects of business activities.
For this reason, I strongly believe that we must
rapidly improve whatever elements of our corporate
culture that are found lacking, raise awareness ofcompliance among employees throughout the Group,
and advance the multifaceted aspects of ourcorporate governance.
To meet these challenges, in 2024, the Audit
Committee has been monitoring the effectiveness of the
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GovernanceCommittee in charge of Mindset and Behavior Reform.
Monitoring has taken the form of an employee
awareness survey; the qualitative and quantitative
measuring of the degree to which ethical businesspractices have been embraced by the Group; andassessing whether business process controls areoperating impartially and transparently.
We have also been communicating with the Internal
Audit Department and independent auditors to determine
whether financial accounting and auditing are being carriedout promptly and properly. By fulfilling these responsibilities,
we hope to meet the expectations of all stakeholders.

Balancing management diversity andexpertise to bolster competitivenessKeiichi Sagawa

Independent Outside Director
Chairman of the Nominating Committee
The Nominating Committee selects director candidates tobe proposed at the general meeting of shareholders, andexecutive officer candidates to be proposed to the Boardof Directors. It also formulates succession plans. In 2023,
the Committee held further discussions on requirements
for successors, and examined candidate information in
greater detail. In 2024, we would like to have even moretransparent and impartial discussions about these matters.
Key tasks on the Group’s management agenda
include fundamental business restructuring amid an
extremely competitive environment, and corporate

culture reforms stemming from issues related to theTokyo 2020 Olympic and Paralympic Games.
To make progress on these tasks and meet the
expectations of stakeholders, the Group’s management
team must be highly strategic and innovative, anddemonstrate strong leadership. It is also essential tohave a board of directors, mainly from outside thecompany, with the expertise and diversity to properly
govern the executives. The Nominating Committee isworking to select the most suitable candidates by not
only meeting with them, but also collecting relevant
information through people networks inside and outside
the Group.
When choosing successors to members of the
management team, it is essential to take a long-term
perspective, specify necessary requirements for the
positions, and have a plan to develop the successor.
The Nominating Committee will further discuss thesematters while obtaining relevant information fromexecutive management. We hope to assemble amanagement team capable of improving the Group’s
competitiveness and quickly generating innovation.

More transparent compensation will
boost the Group’s value

as part of a three-committee governance structure,much of our efforts were to develop a compensation
system based on the principles of transparency andgood governance. The Committee seeks to ensure thatdentsu can attract and retain the best talent while also
ensuring that management’s incentives are betteraligned with our stakeholders. This is a critical concern
for a company like dentsu, whose most precious
resource is its people and their creativity.
As chair I seek to listen to and balance the views ofmanagement, of committee members as well as theinsights of compensation specialists with whom we work,
while also being mindful of the concerns of ourshareholders. In this financial year, we will strive toensure that dentsu’s compensation is a tool to increase
the Group’s competitiveness as it seeks to reinvent itself
under the One dentsu Operating Model. We will work
hard to ensure that compensation KPIs reflect thisambition as well as the Group’s challenging businessenvironment. At the same time, we will also continue toensure that the Group benchmarks its compensation
system carefully and correctly and that we create theright balance of short-term and long-term incentives.
I look forward to building on and improving oursystem to drive enhanced value for the Group andour stakeholders.

Andrew House

Independent Outside Director
Chairman of the Compensation Committee
With the establishment of a Compensation Committee

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Executive compensation
policy for determining theamount of compensation andcalculation methods
Basic policy for determining compensation of officers• Framework for compensating officers
As a company with a board committee structure, dentsu
has a Compensation Committee whose members andchairperson are outside directors. The Compensation
Committee deliberates and decides on the level andstructure of compensation as well as targets for variable
compensation for directors and executive officers based
Attract and retain outstanding talent by
providing attractive total rewards andCompetitive pay

environment

Career growth
opportunities

Achieve the Group’s strategic goals

Pay for performance

globally-integrated management team

Challenging goals

Strengthen alignment with interests ofCreating value
for society

by maximizing the performance of theshareholders and all other stakeholders

on the following compensation framework.
• Compensation levels
To secure globally talented management personnel, theGroup sets compensation levels appropriate for eachmanagement role based on amounts paid by industry
competitors and companies with similar market caps
operating in major markets, including Japan, the US, andthe UK.
• Compensation system
Compensation of executive officers (including those
concurrently serving as directors) is composed of basic
annual salary, annual bonus, and performance-based
stock compensation.
The Group provides outside directors and thoseinside directors not concurrently serving as executive
officers only with a basic annual salary.
To help improve its financial performance and market
capitalization over the medium and long terms, the Group
has set the medium- to long-term bonus for the President& Global CEO at 1.5 times the amount of the basic annual
salary and the annual bonus, respectively. The proportions
set for other executive officers are based on their global
management responsibilities.

Category
Fixedcompensation

Type

Monetary
compensation

DetailsBasicannualsalaryRegular fixed amount, paideach month

Annualbonus

Based on numerical values ofindicators for each fiscal year

The Group’s stock is awarded,
through a trust, in amounts
Variablereflecting the number of
Performancecompensation
Stockunits allocated on a specificbased stockcompensation
date each fiscal year, andcompensation
adjusted after three years
based on the performanceindicator targets reached.

Composition of annual compensation
Performance-based stock compensation

Basic annual salary

29% 1

43% 1.5
Variable compensation

70

c.

%

Executive Officer,
President & CEO
Annual bonus

29% 1
Note: T he diagram shows the ﬁnal composition of annual compensation
assuming that all targets have been accomplished.

Accountability

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Performance-based compensation structure• Objective of setting indicators
For each type of performance-based compensation, theGroup has specified performance indicators andcalculation methods to motivate executive officers topromote business transformation and growth strategies,
work to maximize corporate value, and fulfill the Group’s
purpose: an invitation to the never before.
Performance-based compensation structure
Compensation

Performance indicator
Total Shareholder Return(TSR) vs. peer group

Performancebased stockcompensation

Total Shareholder
Return (TSR) including
dividends vs. Tokyo
Stock Exchange Stock
Price Index (TOPIX)

Details and objective

Increase the Group’s
stock price and shareprofits withshareholders

Consolidated underlying
Sustainable profit
operating income
growthcompound annual
growth rate (CAGR)

Annual bonus

Organic growth rate,
Operating margin

Expand businessrevenues and growth ineach fiscal year

Individual performance
evaluation

Promote business
transformation

Non-financial
indicators

Implement ESG andsustainability-related
initiatives

Maximize corporate value / Fulfill the Group’s purpose:
an invitation to the never before.

• Performance targets and compensation breakdown in 2024
Depending on the achievement of the targets shown
below, executive officers receive an annual bonus
ranging between 0 and 200% of their annual salary, andperformance-based stock compensation ranging
between 30 and 170% of their annual salary.
Compensation governance• Malus and clawback clauses
The Group has set the Officers Stock Benefit Regulations
Annual bonus
Category

Performanceindicator

Organic growth
Financial rate
indicators
Operating margin
Individual
performance
evaluation

TargetUpper limit
targetRatio

Performance-based stock compensation(Performance evaluation period: 2024-2026)

3.1%

8.3%

50%

Category

15.3%

16.1%

20%

Management targets
set for each executiveofﬁcer
Employeeengagementscore (points)

stipulating that the Group may withdraw some or all ofan executive officer’s right to receive performance-based
stock compensation (malus) or demand the return ofsome or all of the stock or cash that has been paid froman executive officer (clawback), by resolution of theCompensation Committee, if the executive officer hascaused serious damage to the Group through intent,
negligence, inappropriate actions, etc., or where there isan error in financial information with the effect of
decreasing the amount payable to the executive officer.

68

—

ESG
Proportion ofindicators female leaders*1

34.3%

—

GHG emissions(Scope 1+2) vs.
baseline*2

79%

—

20%

10%

*1 Definition of the “female leaders”
https://www.group.dentsu.com/en/sustainability/common/pdf/third-partyassurance.pdf*2 Based on a 2019 baseline. We submitted new GHG reduction targets to the
Science-Based Targets initiative (SBTi) in 2024.

Performanceindicator
vs. peer group*3

Total
Shareholder
Return (TSR) vs. Tokyo Stock
Exchange Stock
Price Index (TOPIX)
Consolidated Compound
underlying
annual growth
operating profit rate (CAGR)
Fixedcompensation—

Upper limit
targetRatio

Average TSR
Average TSRof 2nd andof 1st and 2nd
3rd highest
companies
companies

20%

Target

100%

150%

15%

8.1%

12.0%

35%

—

—

30%

*3 A
 peer group of six companies has been selected, comprising WPP plc, Omnicom
Group Inc., Publicis Groupe S.A., Interpublic Group of Companies, Inc., Accenture
plc, and Hakuhodo DY Holdings Inc., which are competitors of the Group.
*4 D epending on the Executive Officer, all base units of performance-based
stock compensation may be treated as the “variable portion” and a variable
range of 0 to 200% may be applied.

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GovernanceRisk management
Approach
To achieve management goals, the Group identifies andevaluates risks as uncertainties we face. By addressing andmonitoring high-priority risks, we implement optimal risk
responses, which include the avoidance and mitigation ofrisks that may become obstacles to achieving our businessobjectives. This allows us to maximize the realization ofopportunities, either by overcoming or taking risks.
The Group formulates and implements an annual
plan for risk management. We are thus able to identify
strategic risks, major operational risks, and emerging risks,
as well as to streamline risk management processes andpromote the development of a risk culture.
Structure
We have in place a Group Management Team topromote management globally. This enables the Groupto transition to a structure that facilitates accelerated
business transformation and enhanced management.
The result is business growth and the enhancement ofsustainable corporate value.
In addition, we have set up the Group Risk
Committee, under which four Regional Risk Committees
were formed to strengthen Group risk management.
The Group Risk Committee mainly covers mediumto long-term strategic risks. To strengthen the Group’s

strategic risks at the regional level in cooperation with
the Group Risk Committee, as well as identifying andmanaging major operational risks.
For example, in Japan, the dentsu Japan CEO chairs
the dentsu Japan Risk Committee and is responsible for
implementing policies and goals set by the Group Risk
Committee, as well as for managing risks specific to theJapan business.
The activities of, and responses by, the Group Risk
Committee and each of the four Regional Risk
Committees are regularly monitored by the GroupManagement Board and the Board of Directors.

risk management-related control and monitoring
functions, starting this year the Group Risk Committee ischaired by the Representative Executive Officer,
President & Global CEO, and the Regional CEOs fromJapan, the Americas, EMEA, and APAC have been
appointed as committee members.
In addition, a new Global Internal Controls & Risk
Officer has been appointed from the GroupManagement Team to enhance the promotion of risk
management activities.
The four Regional Risk Committees, under theGroup Risk Committee, are in charge of managing
Management domain

Management structure
Board of Directors

Audit Committee

Group Management Board

Group
Risk Committee
Strategic risk
Operational
risk

Audit

Japan
Risk Committee

Chair: Representative Executive Officer, President & Global CEO
New members: 4 Regional CEOs / 6 other members
ReportAmericas
Risk Committee

EMEA
Risk Committee

APAC
Risk Committee

Cluster/Large Market Risk Committees

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GovernanceSpecific risk management initiatives
Based on the Enterprise Risk Management (ERM)
approach, the Group identifies and evaluates risks* thatare of major significance to Group management.
Further, to steadily improve its quality, we haveestablished a three-year plan to promote more effective
and efficient risk management.
To manage the likelihood of risks materializing andcontrol their impact should they materialize and reachspecified levels, risk sponsors are selected for each risk.
Once the degree of the Group’s risk exposure(evaluated using a heat map based on Likelihood of
Occurrence × Impact) has been ascertained, a response
plan and deadline are determined, and progress isreported regularly with the aim of mitigating risks.
Overall risk exposure is reviewed annually, while
individual risks are reviewed as necessary and appropriate.
With regard to emerging risks stemming fromclimate change and other conditions that were notfactors in the past, the Group Risk Committee and thefour Regional Risk Committees work together as needed
to identify risks, assess potential impacts on
management and business strategies, and formulate
response plans.
In addition, our risk taxonomy (the comprehensive,common, and stable set of risk categories we use, andtheir systematic organization) is updated as needed andapplied to the entire Group to ensure comprehensive

Risk management based on ERM Ascertaining and responding to emerging risks

Risk taxonomy

Regular identification and assessmentof, response to, and reporting cycle formajor risks

Systematic organization of terminology
ensures that the Group has a rational,
comprehensive, common, and stable set ofrisk management categories across the board

ReportingIdentification

Communication
andconsultation

Response

Assessment

The four Group risk subcommittees ascertain
emerging risks

Strategic
risksOperationalrisks

risk management.
Meanwhile, to foster and disseminate a risk culture
throughout the Group, we provide risk management training
for senior management and employees as appropriate.

Emerging
risks

Process risks*F or details, please see the “Business and Other Risks” section on page 23 of the Financial Report 2024.
https://ssl4.eir-parts.net/doc/4324/yuho_pdf/S100T4UC/00.pdf (Japanese language only)81Contents

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Governance

Cyber security
Our security program
Dentsu has developed a security program with an
overarching objective to protect our business and people
from threats, enable our colleagues to work securely,
and provide assurance to clients and Group leadership.
- Business priority
Security is an integral part of our business processes
and recognized as critical to meeting the needs of ourinternal and external stakeholders.
- Significant investment
We take security seriously and commit resources to

Onboarding

Offboarding

DentsuSecurity Education

AnnualMandated
RefresherSpecialist
Training
Mandated
OnlineTraining /Regular
Comms

Security Basic
Training

Security
Inductions

ensure consistent implementation of industry standard
safeguards across our business.
- Global consistency
Our team is run by a Group Security Officer who isaccountable for Group-wide security with support
from a network of regional Chief Information
Security Officers.
- Sound governanceOur management is responsible for effective oversightof security processes, including specificaccountabilities, policies, and controls.
- Independent assurance
Assessments (internal and external) are conducted forcorporate governance, client compliance, and risk
management purposes.
Employee awareness
Dentsu promotes a comprehensive security awareness andeducation program through a number of key initiatives:- Annual mandatory security awareness training- Targeted training for high-risk roles and functions- Regular policy-focused communications- Periodic simulated phishing campaigns
Governance and risks
Based on the Enterprise Risk Management approach,dentsu aims to minimize the likelihood of identified
security risks from materializing. However, should theyoccur, the Group minimizes their impact by selecting risksponsors to whom they delegate the formulation andimplementation of risk response plans, with the Dentsu

Security Risk Committee regularly monitoring the
responses. Furthermore, known security issues arising fromsecond line assurance are also monitored and reported
through the same risk management methodology.
Securing our operations• Advanced threat protection- Anti-malware for email, web, and endpoints- Next-gen endpoint detection and response system- Actionable intelligence to defend against emerging threats- Proactive threat hunting across network and devices• Monitoring & Incident response- Expert 24×7 security monitoring- Centralized, correlated visibility of activity- Capability to quickly contain and respond to threats- Regular testing of incident response processes• Identity & Access management- Central oversight of user access and joiner/leavers- Real-time auditing of privileged users and domain- Multi-factor authentication used for core applications• Infrastructure & Asset protection- Independent testing of network perimeter- Detect and fix vulnerabilities before attackers- Secure internet gateway used by our endpoints
2024-2026 Focus Areas- Continuously review and improve security structure- Continuously strengthen data-centric management systems- Promote security in product development- Develop dentsu’s security personnel

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GovernanceSupply chain management
Basic stance
Dentsu regards supply chain management as animportant issue. In procurement, we have establishedand disclosed Group policies and put in place thenecessary systems.
• Eligible suppliers
Dentsu’s suppliers include a wide range of media,
production, technology services, goods suppliers,
consulting firms, and other professional services firms.
• Structure
Dentsu’s Global Chief Governance Officer (GCGO) &Global Chief Financial Officer (GCFO) are the owners
and responsible for Group policies. Matters of highimportance are brought up for discussion at important
meetings, such as the Group Management Board, andare also reported to the Board of Directors as necessary.
In addition, dentsu Japan and International each havetheir own procurement teams responsible for
implementing actions in line with policies and supply
chain management.
• Clarification of supply chain management policy
Besides disclosing the dentsu Group Procurement Policy,
which sets out our approach, we have developed thedentsu Group Supplier Code of Conduct to set out our
expectations for suppliers who do business with us.
Guidelines and procedures have also been formulated
for each region in accordance with regional businesspractices and structures, and these are managed by the
procurement teams in charge of each region.
 ealing with suppliers (risk monitoring and decarbonization)•D
We clearly define the key risks – not only country andsector risks, but also environment, human rights,
compliance, information management, anti-corruption,
and ESG risks – in our transactions with suppliers,
conduct thorough due diligence information gathering
for risk management purposes at the start oftransactions with suppliers, and conduct necessary
monitoring during transactions. Together with our
procurement and sustainability teams in Japan andInternational, we plan to move forward with efforts
toward decarbonization in the future.
• Escalation process and external hotlines
Procurement teams in each region, independent ofbusiness divisions, collect, analyze, and verify
multifaceted information, including information received
by hotlines for consultation from external suppliers, andconsider and implement necessary measures. We havealso established Speak Up@dentsu, a reporting window
where suppliers can consult anonymously.

Details of dentsu Japan (hereafter, dJ) initiatives(1) Establishment and publication of guidelines
In order to build a sustainable supply chain that
contributes to the development of our clients andsociety, we have established and published the dentsu
Japan Procurement Guidelines, which we require not
only companies belonging to dJ, but also suppliers of dJ
companies, to comply with.
(2) Guideline compliance measures
dJ encourages the management of dJ companies tocomply with and implement the dJ Procurement
Guidelines, and periodically checks the status of
implementation and provides support.
(3) Monitoring
Based on reports from business divisions and informationcollected as needed by the Credit and Procurement
Division, when individual cases/issues occur or have thepotential to occur at suppliers, internal investigations
and hearings are conducted to quickly determine
whether transactions may continue.
(4) EscalationdJ companies and dJ procurement teams work together
to share information and resolve issues. Important issues
are reported to and discussed by the dJ Trade
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Governancetransactions and makes decisions on whether tocontinue transactions.
(5) Education and training
The dJ procurement team shares with dJ companies specificimplementation methods for contracting, information
security, and monitoring related to procurement.
(6) Risk management and due diligence
We manage risk by ensuring that a contract is signed at
the start of the transaction, and conduct category
specific risk management and investigations todetermine feasibility of the transaction.
(7) Examples of supply chain optimization and ongoing initiatives
The dJ procurement team implements a variety ofmeasures. For example, we have appointed a dedicatedperson for transaction management, which is one of themeasures for “Mindset and Behavior Reform” in dJ, and weregularly monitor and analyze our suppliers. We also
place great importance on communication with suppliers.

Details of International (outside of Japan) initiatives(1) Establishment and publication of guidelines
In addition to establishing the Purchase to Pay Policy, we
carry out procurement activities in compliance withlocal business practices and regulations.
(2) Guideline compliance efforts
The International Procurement Team manages highspend and criticality central or global contracts withthird-party suppliers. Beyond this, procurement ismanaged by either local procurement teams or otherfunctions such as operations or finance. Procurement
activity compliance is managed through an Internal
Control Framework.
(3) Monitoring
In addition to local monitoring by each company, forglobal requirements the International Procurement
Team supports supplier due diligence and risk
management. The team works with the business andsupplier as required to resolve any issues.
(4) Escalation
Monthly reports are presented at high-level meetings
with finance, legal, and technology representation by
the International Procurement Team. These reports
include key contract activity, negotiated savings andprocurement- related risks and opportunities.

(5) Education and training
International Procurement Team members receive
training in commercial negotiation and sustainableprocurement, and are supported in studying forprocurement qualifications. This is in addition to
standard employee training relating to policies such asdata protection, security and the Dentsu Group Codeof Conduct.
(6) Risk management and due diligence
For new suppliers, due diligence is carried out to confirm
acceptance of dentsu’s Supplier Code of Conduct,assess financial viability, regulatory, and compliancerisks such as fraud and bribery, and confirm appropriate
data security. As good practice we also encourage
gathering information on ESG factors.
(7) Examples of supply chain optimization and ongoing initiatives
The International Procurement Team has introduced
supplier segmentation to identify key suppliers andensure appropriate resources are assigned to manage
their activity. During 2024, we are introducing a new
supplier onboarding tool for global suppliers that will
enable greater use of targeted risk related questions
appropriate to the supplier.

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GovernanceCompliancecompliance management structure which we arecontinuously strengthening.

The Dentsu Group Code of Conduct states, “At dentsu
we believe we must be a force for good. When we do theright thing as individuals, it becomes who we are as acompany. It’s what makes being a force for good
possible, and it starts with each and every one of us.”
To achieve this, we have established the following

Group Compliance Committee
For dentsu, which aims to become a B2B2S company,
ethics and compliance are the foundation of all of ouractivities. We have established the Group Compliance
Committee as a committee under the GroupManagement Board, and have also establishedcompliance committees in our four regions (Japan, APAC,
EMEA, and the Americas) as supporting organizations.
With the above system, we aim to align under aunified vision across the Group and promotecompliance management.

Compliance management
Board of Directors

Group Management Board
Group Compliance Committee
President & Global CEO
Executive Vice President, Global Chief Governance Officer / Global CFO (Chair)
Executive Vice President, Global Chief Corporate Affairs Officer
Executive Vice President, Global COO / Chief Global Client Officer
General Counsel and Regional CEOs, etc.

Japan
Compliance Committee

APAC
Compliance Committee

EMEA
Compliance Committee

AmericasCompliance Committee

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GovernanceCompliance Program
The vision of the Group Compliance Program is to meetglobal standards of best practice in ethics andcompliance and establish a reputation as a governanceleader. Realizing the vision requires the Group to ensurethat the Group Compliance Program is well designed,
applied with commitment, and operated effectively inpractice. This vision requires the responsibility andcommitment of top management to compliance both at
the Group and regional level, and to proactively promote

doing business with integrity.
The following chart illustrates an overall picture of
the Group Compliance Program.

Program Design

Program Effectiveness

Risk Assessment

Policies & Procedures

An established risk
assessment approach
to identify realcompliance risks that
inform our programand enable mitigation
strategies.

Strong, well-managed
compliance policies
and an effective global
policy management
system that drives anethical and compliant
culture, supports
dentsu’s strategic vision,
protects its people, andmitigates risk.
Point 1

p. 87

Training &Communication
An integrated, riskbased, multichannel
training andcommunications
program which uses avariety of techniques
to deliver effective andengaging training &communications.

Point 2

p. 87

Confidential Reporting& Investigations Process
A clear and consistent
approach toconfidential reporting
includingwhistleblowing andinvestigations.

Point 3

Due Diligence & ThirdParty Management
Ongoing contribution
to development of astrong third-party
governance structure,
which is suitable for
identifying, detecting,countering, andmitigating thecompliance risks
associated withthird parties.

Mergers & Acquisitions
Effective compliancedue diligence,monitoring andintegration activities
that effectively
uncover and mitigate
compliance risks
arising from M&A
activities and that are
fully integrated with
the M&A process.

Continuous
Improvement, Periodic
Testing & Review

Investigation of
Misconduct, Analysis &Remediation

p. 87

Implementation
Commitment from Senior & Middle Management: Tone & Conduct from the Top
Compliance Structure & Governance—Autonomy & Resources
Discipline & Incentives

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Point 1
Policies & Procedures• Establishment of Group Code of Conduct
The Dentsu Group Code of Conduct establishes a codeof behavior that serves as the fundamental philosophy
for promoting compliance across the Group. It stipulates
the actions to be taken and the principles to be observed
as a member of dentsu, including an emphasis on
diversity and compliance with laws, regulations, andinternal rules.

Point 2Training & Communication
We conduct a variety of ethics and compliance training
programs across the globe such as e-learning for the
Code of Conduct. We also provide employees with avariety of compliance-related information through our
intranet for their awareness.

Point 3
Confidential Reporting & Investigations Process
As our whistle-blowing hotline for use by all officers andemployees of Group companies, we have Speak Up@
dentsu. We also have Compliance Line for Japan. By
linking the functions of these hotlines to the early
detection and remediation of compliance violations, weare promoting compliance management and the soundgrowth of our business.

For the full text of the Dentsu Group Code of Conduct,
please refer to our website.
https://www.group.dentsu.com/en/about-us/
governance/codeofconduct.html
Compliance training in Japan• Establishment of Group Policies
To realize the principles of the Dentsu Group Code of
Conduct, we have established Group-wide policies
including the Group Anti-Bribery & Corruption Policy,
Group Legal Policy, and Group Global Data Protection
Principles. Going forward, we will further introduce
Group-wide policies and promote compliancemanagement under a unified vision across the Group.

Group-wide whistle-blowing hotline

Compliance training outside of Japan

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GovernanceThe dentsu Japan Reform
Committee “Mindset andBehavior Reform”
Mindset and behavior reformOn February 28, 2023, a criminal complaint was filed
against an employee of dentsu’s Japanese subsidiary by theJapan Fair Trade Commission, and Dentsu Group Inc. wassubsequently indicted by the Tokyo District Public
Prosecutors Office for an alleged violation of the
Antimonopoly Act in connection with the bidding for the test
events of the Tokyo 2020 Olympic and Paralympic Games.
We sincerely apologize to our shareholders and allother stakeholders for the inconvenience and concern
this has caused.
In the ongoing trial, the Group has admitted thatit engaged in unfairly restricting business activities
with regard to competitive bidding for “test event
planning” services.*
The Group takes this matter very seriously. As aresult, dentsu Japan is engaged in Company-wide,
compliance-related Mindset and Behavior Reform.
These are based on the investigation report andrecommendations submitted by the Investigation andReview Committee, which comprises three outside
experts. The aim is to ensure operational fairness andtransparency, and to prevent the recurrence of issues

resulting from our organizational culture.
* At the same time, it was determined that there were no
unfair restrictions of business activities with respect totest event implementation or main event management
services, which were subject to negotiated contracts.
Reform Committee background
With the aim of fulfilling our responsibility to all
stakeholders by renewing the way we approach our work,
MemberResponsibility
Project lead,
Hiroshi Igarashi
Representative Executive Officer, Reporting to the
Chair
President & Global CEO, dentsu Board of Directors
Arinobu Soga
Representative Executive Officer, Assisting the Chair,Vice-chair Executive Vice President, Global Implementation ofChief Governance Officer &reforms
Global CFO, dentsu
Outside Toshihiko Itami,
Advisory
Member Attorney-at-Law
Outside Genta Yoshino,
Advisory
Member Attorney-at-Law
Outside Yasuo Daito,
Advisory
Member Attorney-at-Law
Tadashi Nagae
Global Corporate Secretary &Implementation ofMember
Deputy Global General Counsel, reforms
dentsuDrafting the initiatives,
Takeshi Sano
reporting progress to
LeaderCEO, dentsu Japan
the Committee
Drafting the initiatives,
Leader/Yoshimasa Watahiki
reporting progress to theSecretariat
COO, dentsu Japan
Committee, operation of
Head
the Committee

the dentsu Japan Reform Committee was established in
May 2023. It is chaired by President & Global CEO
Hiroshi Igarashi.
In order to incorporate outside perspectives, threeoutside attorneys act as advisors, providing guidance
regarding the efficacy of reform measures. A former
member of the Investigation and Review Committee,
Attorney Toshihiko Itami, was appointed to the Reform
Committee to ensure the efficacy and consistency ofreform measures.
We then formulated three reform pillars and 17
initiatives. While monitoring the progress of theinitiatives, the Committee met and held more than 25
discussions, the details of which were regularly reported
to the Board of Directors.
About KGIs and KPIs
We use three Key Goal Indicators (KGIs) and incorporate
external perspectives to measure the progress of reforms.
The first KGI is the evaluation of employee-related
reforms. Since November 2023, we have conducted
three awareness surveys of dentsu Japan staff tomeasure the degree to which reforms have taken root
and activities have improved.
The second KGI concerns monitoring evaluations.
The three outside committee members regularly conduct
a comprehensive determination of our reform efforts.
The third KGI involves evaluation by external

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Governancestakeholders. This is designed to improve the Group’s
image in the eyes of business partners and in
consumer surveys.
Specific indicators are also tracked as Key
Performance Indicators (KPIs). These include theprogress towards our 17 reform initiatives, employee
survey results and whistleblowing cases.
The third dentsu Japan employee survey, conductedin May 2024, shows a steady increase in the scores forthe perceived need to reform mindset and behavior(91.0%) as well as to prioritize integrity (96.4%).
KGI 1 Evaluation by employees: Employee survey
		 1. Organizational culture		
2. Risk management system & legal andcompliance functions
		
3. Fair & transparent transactions
2 Evaluation by the advisory group:		Comprehensive assessment by the outsidecommittee members
3 Evaluation by external stakeholders:		
Supplier and consumer survey
KPI Completion of initiative:		Completion of all 17 initiatives
Employee Awareness & Behavior Indicators:		Employee awareness, understanding andpractice of actions in accordance with initiatives		 • Awareness • Understanding • Practice
Fact indicators associated with the initiatives:
		 Outcomes and facts associated with each initiative		 • Number of whistleblowers		• Number of positions dedicated to compliance		• Training participation rates, etc.

Reform progress
We are promoting three pillars of reform that cover our
17 reform initiatives. This reflects our policy of increasingawareness of the Group’s responsibility to society, theneed for transparency, and our desire to clarify the rules
and ways we must follow.
• First pillar: Establish an organizational culture that
ensures proper corporate activities
To achieve such a culture, we must take the following six steps:
1. Ensure familiarity with the Dentsu Group Code of Conduct.
2. Increase the dentsu Japan Chief Culture Officer’s commitment.
3. Promote dialogue between management andemployees regarding proper corporate activities.
4. Take strict disciplinary measures against those
involved in the alleged Tokyo Olympic Games-related
violation of the Antimonopoly Act.
5. Clarify what is required of leaders. This should bereflected in evaluations andpromotions.
6. O ptimize and revise HR systems
as necessary.
All employees complete Code of
Conduct training. In addition, an
ongoing, Company-wide dialogue
between management andemployees takes the form of

meetings and small-group roundtable discussions.
In order to survey management, we will be
introducing a dentsu Japan-wide, 360-degree evaluationof management.
• Second pillar: Strengthen our risk management system
and legal and compliance functions
To do so, we must carry out the following seven actions:
7. Improve the whistleblowing process and provide newwhistleblowing platforms.
8. Systemize and enhance compliance.
9. Expand our legal and compliance structure.
10. Strengthen the monitoring function via internal audits.
11. Make the dentsu Japan Risk Committee more flexible.
12. P lace a compliance manager in all sections
responsible for business execution.
13. Consider having a disciplinary system to restore
corporate order.
Speak Up@dentsu is a new whistleblowing portal
accessible at all dentsu companies. It is free to use,confidential, and available 24 hours a day, seven days aweek via toll-free numbers or at speakup.dentsu.com.
Because the availability of this portal has helped
create an environment in which staff feel more
comfortable speaking out, the number of reports being
made is on the rise.
Further, compliance officers and compliance89

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Governancemanagers responsible for promoting complianceawareness and behavior reforms have been appointed ateach business site.

• Third pillar: Introduce business processes that ensure
fair, transparent transactions
Doing so requires that we undertake four activities:
14. Appoint experts as external advisors.
15. Develop and apply business guidelines.
16. Set up and apply rules for secondment if there is a
conflict of interest.
17. Appoint dedicated personnel to manage transactions(procurement, purchasing, etc.).

same time, we are strengthening transaction
management regarding procurement and purchasing. To
this end, we have set up a dedicated department tocheck business processes, formulate procurement
guidelines for the entire Group, and reinforce themanagement system for deliverables.
Although many of the above-mentioned measures havebeen implemented in part or completely, we will continue topromote mindset- and behavior-related activities.
WebsiteRecurrence Prevention Initiatives(mindset and behavior reform)
Recurrence Prevention Initiatives (mindset andbehavior reform) - Dentsu Group Inc.

We have formulated and are working to ensure thoroughimplementation of guidelines for our dealings withsports businesses and the public sector. This is to prevent
our employees from getting involved in improper
activities related to, for example, bidding.
Our rules on secondment have been revised andimproved, and will be implemented meticulously. At the90

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Financial data
Non-financial data
Subsidiaries and affiliates
Information for shareholders / Share information
Editorial policy

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Data

Financial data
Consolidated

(Millions of yen)

2016

2017

2018

2019

2020

2021

2022

2023

Profit and loss statement
Turnover
Revenue
Revenue less cost of sales
Operating profit (loss)
Profit (loss) before tax
Profit (loss) for the year attributable to owners of the parent
Underlying EBITDA*1

4,924,933
838,359
789,043
137,681
132,918
83,501—

5,187,300
928,841
877,622
137,392
149,662
105,478—

5,357,278
1,018,512
932,680
111,638
148,751
90,316—

5,146,802
1,047,881
939,385(3,358)(42,769)(80,893)—

4,498,216
939,243835,042(140,625)(141,133)(159,596)
145,335

5,256,492
1,085,592
976,577
241,841
208,833
108,389
195,006

5,819,519
1,243,883
1,117,002
117,617
100,908
59,847
217,515

5,953,391
1,304,552
1,144,819
45,312
33,103(10,714)
175,758

Underlying operating profit
Underlying net profit (attributable to owners of the parent)

166,565
112,972

163,946
107,874

153,229
97,419140,751
76,120123,979
69,890179,028
109,203203,189
130,037

163,515
89,839Balance sheet
Total assets
Total equity attributable to owners of the parent

3,155,230
932,7423,562,857
1,093,211

3,638,488
1,047,619

3,795,729
974,977

3,380,412
756,870

3,720,536
845,034

3,741,427
880,267

3,634,401
841,651

Cash flow
Net cash flow from operating activities
Net cash flow from investing activities
Net cash flow from financing activities
Cash and cash equivalents at end of period

143,585(156,161)
2,539
242,410

141,557(85,531)1,226
305,760

133,049(61,382)
57,522416,668

79,957(76,051)(7,803)414,055

88,313137,013(96,622)
530,692

139,715
262,226(232,189)
723,541

80,896(24,346)(188,192)
603,740

75,267(146,297)(153,681)
390,678

Number of employees
Number of consolidated subsidiaries

55,843844

60,064911

62,608976

66,4001,004

64,533
1,007

64,832907

69,066881

71,127808*1 U
 nderlying operating profit before underlying depreciation and amortization (excluding depreciation adjustments
under IFRS 16).
Notes: The Group has adopted IFRS 15 “Revenue from Contracts with Customers” from the fiscal year ended
December 31, 2018, and IFRS 16 “Leases” from the fiscal year ended December 31, 2019.
The figures for prior years are not restated and based on the former standards.

Notes: The Group previously recognized intangible assets for configuration or customization costs in cloud computing
contracts in accordance with IAS 38 “Intangible Assets”. However, from the fiscal year 2021, based on thediscussions that led to the agenda decision of the IFRS Interpretations Committee issued in April 2021, theCompany has changed to a method of recognizing the cost of configuration or customization services as an
expense when they are received. However, in this book, figures for prior years are presented before the changein accounting policy. Therefore the figures of the fiscal year ended December 31, 2020 differ from the 2020
figures in the Summary of Financial Results for the Fiscal Year Ended December 31, 2021 where thepresentation was retrospectively restated.

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Financial data
Organic growth rate
Japan
International
Americas
EMEA
APAC
CT&T ratio
Japan
International
Operating margin
Japan
International
Return on equity (ROE)*1
Underlying ROE*2
Return on assets (ROA)*3
Ratio of equity attributable to owners of the parent (Equity ratio)*4
Basic earnings per share (yen)Basic underlying profit per share (yen)Cash dividend per share (yen)Dividend payout ratio*5
Underlying dividend payout ratio*6

(%)

2016

2017

2018

2019

2020

2021

2022

2023

5.1
4.5
5.7
—
—
—
—
—
—
21.1
26.8
16.2
8.3
11.3
4.3
29.6
292.85396.20
85.00
29.0
21.5

0.1
(0.3)
0.4
—
—
—
—
—
—
18.7
24.5
14.6
10.4
10.6
4.5
30.7
373.11381.58
90.00
24.1
23.6

3.4
2.1
4.3
—
—
—
—
—
—
16.4
21.7
12.9
8.4
9.1
4.1
28.8
320.39345.59
90.00
28.1
26.0

(1.0)
0.4
(1.9)
—
—
—
—
—
—
15.0
19.1
12.2
(8.0)
7.5
(1.2)
25.7
(287.92)270.94
95.00
—
35.1

(11.1)(8.4)(13.0)
—
—
—
27.5
24.5
29.7
14.8
18.0
13.7
(18.4)
8.1
(3.9)
22.4
(571.19)250.14
71.25
—
28.5

13.1
17.9
9.7
—
—
—
29.1
24.4
32.6
18.3
22.9
15.9
13.7
13.8
5.9
22.7
388.79391.71117.50
30.2
30.0

3.2
0.4
5.1
—
—
—
32.3
28.5
34.6
18.2
24.1
15.7
6.9
15.1
2.7
23.5
223.33485.26155.25
69.5
32.0

(4.9)
1.6
—
(7.2)
(10.9)
(8.2)
31.9
—
—
14.5
—
—
(1.2)
10.4
0.9
23.2
(40.52)339.79139.50—35.0*1 ROE (IFRS) = Profit for the year attributable to owners of the parent ÷ Average equity attributable to owners of theparent based on equity at the beginning and end of the fiscal year x 100* Fiscal year-end before alignment across the Group means March*2 Underlying ROE = Underlying net profit (attributable to owners of the parent) ÷ Average equity attributable toowners of the parent based on equity at the beginning and end of the fiscal year x 100* Fiscal year-end before alignment across the Group means March*3 ROA (IFRS) = Profit before tax ÷ Average total assets based on total assets at the beginning and end of the fiscal
year x 100*4 Ratio of equity attributable to owners of the parent = Equity attributable to owners of the parent ÷ Total assets*5 Dividend payout ratio = Cash dividend per share ÷ Basic earnings per share x 100*6 Underlying dividend payout ratio = Cash dividend per share ÷ Basic underlying profit per share x 100*FY2023 is calculated based on the adjusted underlying basic EPS

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Value Creation Story

Management Strategy

Data

Non-financial data
Environmental performance data*1

2
2019*

Scope 1
Japan

(tCO2e)

2020

2021

2022

2023

4,888

3,540

3,195

3,267

2,942

344

355

310

348

924



2
2019*

(tCO2e)

2020

2021

2022

2023

16,3709,909

35,89962,906

Scope 3Category 6

79,417

4,544

3,185

2,885

2,919

2,018

Japan

25,406

4,973

3,055

8,893

14,13929,074

23,41520,908

12,771

15,318International

54,011

11,397

6,854

27,006

48,76824,202

20,872

19,343

11,244

11,730Category 7

13,6604,954

14,66827,84827,669

4,872

2,543

1,565

1,527

3,588

Japan

5,049

4,954

2,350

1,893

3,599

Scope 1+2

33,962

26,955

24,103

16,03918,261

International

8,611

N/A

12,31825,95524,070Japan

24,546

21,227

19,653

11,592

12,655

Category 13

3,469

N/A

331

309

291

9,416

5,728

4,450

4,447

5,606

International

3,469

N/A

331

309

291

International
Scope 2
Japan
International

International
Scope 3Category 1

374,884

55,374 360,325 377,456 422,651

Category 15

2,031

N/A

3,790

5,055

6,617

265,960

25,615 316,082 294,923 310,775

International

2,031

N/A

3,790

5,055

6,617

46,113

Japan

28,773

International

237,187

Category 3

8,813

5,481

10,7798,254

10,166

Japan

6,500

5,481

5,155

2,759

3,195

International

2,313

N/A

5,624

5,494

6,971

Category 4

288

1,856

3,558

4,264

3,326

0

1,856

2,978

3,416

2,525

Japan

25,202

24,28432,398413 291,798 262,525 264,662

International

288

N/A

580

848

801

Category 5

1,246

1,098

1,207

904

900

Japan

424

596

931

611

481

International

822

502

276

293

418

Total greenhouse gas (GHG) emissions(Scope 1 + 2 + 3)

408,846

82,329 384,428 393,494 440,911*1 Scope and method of calculation• Includes consolidated subsidiaries in Japan and abroad over which the Dentsu Group Inc. (“dentsu”) exercises
managerial control.
Consolidated subsidiaries that can be judged to have a negligible impact due to number of employees, type of useof bases, etc. are not included.
• Reference made to the World Resources Institute’s (WRI) Greenhouse Gas (GHG) Protocol in the calculation.
• Scope 1 fugitive emissions are not included as dentsu is underway of working on data collection.
• Scope 3, Category 2 emissions for International are included in Scope 3, Category 1 emissions.
• Scope 3, Category 8 emissions from applicable leases are calculated under Scope 1 and 2.
• Scope 3 emissions are excluded for Categories 9-12 and 14 due to immateriality or irrelevance.
• Scope 3, Category 13 emissions are excluded in Japan because the company does not engage in rental businesses.
• Scope 3, Category 15 emissions for Japan are excluded due to difficulties in collecting the data necessary to
calculate emissions.
Note: For more details on methodology, please see our Independent Assurance Report.
*2 The 2019 baseline figures are as of December 31, 2023. We submitted new GHG reduction targets to the SBTi in 2024.

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Value Creation Story

Management Strategy

Data

Non-financial data

Governance data

Total electricity consumption, amount of renewable energy usage,
and renewable energy rate
2020
Total electricity consumption (kWh) 86,675,340
Renewable energy usage (kWh)*1, 2
Renewable energy rate

2021
2022
2023
72,751,938 83,661,353 65,485,764

46,382,752 35,397,299 29,756,238 36,207,570
53.5%

48.7%

35.6%

55.3%

*1 Calculated according to the RE100 standard.
*2 Including the purchase of renewable energy from adjacent markets, the Group’s renewable energy rate increases asfollows:
2020: 59.5%, 2021: 52.5%, 2022: 37.7%, 2023: 59.0%

Directors

2019
12

2020
12

2021
13

2022
13

2023
10

Outside Directors (independent Outside Directors)

4(4)

5(4)

5(5)

5(5)

6(6)

Ratio of independent Outside Directors (%)

33.3

33.3

38.5

38.4

60.0

2

2

3

4

2

Ratio of female Directors (%)

16.7

16.7

23.1

30.8

Board of Director meeting attendance rate (%)

96.9

95.6*

20.0

99.1

100.0

98.0

Attendance rate of independent Outside
Directors at Board of Director meetings (%)

93.8

100.0

98.8

100.0

99.0

Female Directors* Attendance rate was 97.8% excluding times when Tim Andree was absent due to illness.

Internal reporting: number of “Speak Up” incident reports (cases)
Total

2019
35

2020
43

2021
38

2022
100

2023
218

2020
10

2021
6

2022
12

2023
32

Internal reporting: Compliance Line reports (cases)*
Total

2019
17

*M
 ain report content topics include internal harassment, improper treatment, fraud in business operations, andmisgivings about Company systems.

Number of internally reported complaints (cases)*
Total

2019
194

2020
106

2021
136

2022
106

2023
164

* In 2021, previous fiscal year figures were recounted.

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Management Strategy

Data

Subsidiaries and affiliates
As of December 31, 2023, the Group includes 808 consolidated subsidiaries and 85 affiliated companies accounted for by the equity method.
Consolidated subsidiaries
Dentsu Inc.*1
Geographic area: Japan
Equity held by dentsu: 100.0%

Dentsu Corporate One Inc.*1
Geographic area: Japan
Equity held by dentsu: 100.0%

Tag Europe Limited*3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)

Dentsu Asia Pacific Holdings Pte. Ltd.*1, 3
Geographic area: Singapore
Equity held by dentsu: 100.0% (100.0%)

Dentsu International Triton Limited*3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)

Dentsu East Japan Inc.
Geographic area: Japan
Equity held by dentsu: 100.0%

Dentsu Creative Advertising, LLC(formerly Dentsu McGarry Bowen, LLC)*1, 3
Geographic area: USA
Equity held by dentsu: 100.0% (100.0%)

Dentsu Aegis Network Central Europe
Holding GmbH*3
Geographic area: Germany
Equity held by dentsu: 100.0% (100.0%)

Dentsu Singapore Holdings Pte. Ltd.*1, 3
Geographic area: Singapore
Equity held by dentsu: 100.0% (100.0%)

Dentsu International GPS Holdings
Limited*1, 3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)

Dentsu Creative, LLC (formerly The
360i Network, LLC)*1, 3
Geographic area: USA
Equity held by dentsu: 100.0% (100.0%)

Dentsu Aegis Network Central Europe
GmbH*3
Geographic area: Germany
Equity held by dentsu: 100.0% (100.0%)

Dentsu US, Inc.*1, 3
Geographic area: USA
Equity held by dentsu: 100.0% (100.0%)

Dentsu France SAS*1, 3
Geographic area: France
Equity held by dentsu: 100.0% (100.0%)

Merkle Group Inc*3
Geographic area: USA
Equity held by dentsu: 100.0% (100.0%)

Aegis Finance SAS*1, 3
Geographic area: France
Equity held by dentsu: 100.0% (100.0%)

Isobar US, LLC*1, 3
Geographic area: USA
Equity held by dentsu: 100.0% (100.0%)

Aegis International Holding Company B.V.*1, 3
Geographic area: Netherlands
Equity held by dentsu: 100.0% (100.0%)

Dentsu International Americas, LLC*1, 3
Geographic area: USA
Equity held by dentsu: 100.0% (100.0%)

Group Carat (Nederland) B.V.*1, 3
Geographic area: Netherlands
Equity held by dentsu: 100.0% (100.0%)

Agenciaclick - Midia Interativa S.A.*1, 3
Geographic area: Brazil
Equity held by dentsu: 100.0% (100.0%)

Dentsu Media, S.L.U.*1, 3
Geographic area: Spain
Equity held by dentsu: 100.0% (100.0%)

Dentsu Brasil Holdings Ltda.*3
Geographic area: Brazil
Equity held by dentsu: 100.0% (100.0%)

Dentsu (Shanghai) Investment Co., Ltd.*1, 3
Geographic area: China
Equity held by dentsu: 100.0% (100.0%)

Tag Worldwide Holdings Limited*3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)

Beijing Dentsu Advertising Co., Ltd.
Geographic area: China
Equity held by dentsu: 100.0%

Dentsu West Japan Inc.
Geographic area: Japan
Equity held by dentsu: 100.0%
Dentsu Kyushu Inc.
Geographic area: Japan
Equity held by dentsu: 100.0%
Dentsu Runway Inc.
Geographic area: Japan
Equity held by dentsu: 100.0%
Dentsu Digital Inc.
Geographic area: Japan
Equity held by dentsu: 100.0% (25.0%)*3Dentsu Live Inc.
Geographic area: Japan
Equity held by dentsu: 100.0%
Dentsu Promotion Plus Inc.
Geographic area: Japan
Equity held by dentsu: 100.0%
Carta Holdings, Inc.*2
Geographic area: Japan
Equity held by dentsu: 53.4%
Septeni Holdings Co., Ltd.*1, 2
Geographic area: Japan
Equity held by dentsu: 52.6%
Information Services InternationalDentsu, Ltd.*1, 2, 3, 4
Geographic area: Japan
Equity held by dentsu: 61.8% (0.0%)*1 Specified subsidiary*2 Company that submits an annual securities report

Dentsu Asia Pte. Ltd.*1, 3
Geographic area: Singapore
Equity held by dentsu: 100.0% (100.0%)
Dentsu Aegis Network India Private Limited*1, 3
Geographic area: India
Equity held by dentsu: 100.0% (100.0%)
Dentsu Australia Holdings Pty Ltd.*1, 3
Geographic area: Australia
Equity held by dentsu: 100.0% (100.0%)
Dentsu International Australia Pty Ltd.
Geographic area: Australia
Equity held by dentsu: 100.0% (100.0%)*1, 3

Dentsu Corporate Services Ltd.*1, 3
Geographic area: Australia
Equity held by dentsu: 100.0% (100.0%)
Dentsu International Limited*1
Geographic area: United Kingdom
Equity held by dentsu: 100.0%
Dentsu International Holdings Limited*1, 3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)
Portman Square US Holdings Limited*1, 3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)

Dentsu International Finance Ltd.*3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)
Dentsu International Regents Place
Finance Limited*3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)
Dentsu International Treasury Limited*3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)
and 761 other companies

Equity-accounted investees
Video Research Ltd.
Geographic area: Japan
Equity held by dentsu: 34.2%
D2C Inc.
Geographic area: Japan
Equity held by dentsu: 46.0%
and 83 additional companies

Dentsu International Group
Participations Limited*1, 3
Geographic area: United Kingdom
Equity held by dentsu: 100.0% (100.0%)*3 In Equity held by dentsu, the figure in parentheses indicates the ratio of equity held indirectly.

*4 Name changed to Dentsu Soken Inc. on January 1, 2024.

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Value Creation Story

Management Strategy

Data

Information for shareholders / Share information
Information for shareholders(As of December 31, 2023)

Share information (As of December 31, 2023)
Breakdown of shareholders by type
Number ofshareholders

Dentsu Group Inc.

Number ofshares held

Percentage of total numberof shares issued

Corporate Headquarters
1-8-1, Higashi-shimbashi, Minato-ku,
Tokyo 105-7050, Japan
Phone: +81-3-6217-6600

Japanese financial institutions

41

73,827,160

27.32

Japanese securities firms

48

11,288,369

4.18

647

71,976,822

26.64

Contact Info
Investor Relations Department,Group IR Office,1-8-1, Higashi-shimbashi, Minato-ku,
Tokyo 105-7050, Japan
https://contact.group.dentsu.com/m/en_ir

Japanese individuals and others (Including treasury stock)

43,59845,286,874

16.77

Stock Exchange Listing
Tokyo Stock Exchange, Prime Market
Securities code: 4324
Capital¥ 74,609.81 million
Total Number of Shares Issued
270,165,354
General Meeting of Shareholders
The Ordinary General Meeting of
Shareholders is held in Tokyo in Marcheach year.
Transfer Agent
The Mitsubishi UFJ Trust and Banking
Corporation
4-5, Marunouchi 1-Chome, Chiyoda-ku,
Tokyo 100-8212, Japan
Corporate Website
https://www.group.dentsu.com/en/

Other Japanese corporations
Foreign institutions and individuals
Total

727

67,786,129

25.09

45,061

270,165,354

100.00

Number ofshares held

Percentage of total numberof shares issued

Major shareholders (top 10)
Major shareholders

1

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

47,937,500

18.06

2

Kyodo News

18,988,800

7.16

3

Jiji Press, Ltd.

16,028,680

6.04

4

Custody Bank of Japan, Ltd. (Trust accounts)

15,290,860

5.76

5

NORTHERN TRUST CO. (AVFC) RE SILCHESTER INTERNATIONAL INVESTORSINTERNATIONAL VALUE EQUITY TRUST

11,228,000

4.23

6

Group Employees’ Stockholding Association

5,247,882

1.98

7

Yoshida Hideo Memorial Foundation

4,984,808

1.88

8

NORTHERN TRUST CO. (AVFC) RE U.S. TAX EXEMPTED PENSION FUNDS

4,969,860

1.87

9Recruit Holdings Co., Ltd.

4,929,900

1.86

10

NORTHERN TRUST CO. (AVFC) RE NON TREATY CLIENTS ACCOUNT

4,124,9781.55

Notes:
1. The number of shares held by each trust bank includes shares related to trust services.
2. The Group holds 4,801,599 treasury shares but is excluded from the major shareholders listed above.
3. The Percentage of Total Shares Issued is calculated excluding treasury shares.

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Corporate Philosophy

Value Creation Story

Management Strategy

Data

Editorial policy
In Integrated Report 2024, we proactively disclose
information to set expectations around our return toorganic growth and the future of our Group from a
medium- to long-term perspective. In particular, we report
our efforts to generate sustainable value by linking
financial and non-financial aspects towards realizing ourGroup’s corporate philosophy, including the relationshipbetween our Materiality and corporate strategy, as wellas our new 2030 Sustainability Strategy.

Production structure

Disclosure mapping
Qualitative information

Board of Directors
Group Management Board

Feedback

Integrated Report
Production Team

Notice of
convocation

Earnings briefing
material

Sponsor: Yuko Kitakaze(Global Chief Sustainability Officer)

Period covered by the report: Centered on activities during
FY2023 (January 1, 2023 through December 31, 2023), butalso refers to preceding and more recent activities.

(Group IR Office, Group Governance Unit)

Group Sustainability Office

Reference guidelines:• IFRS Foundation, The International Integrated
Reporting Framework• Guidance for Collaborative Value Creation, Ministry of
Economy, Trade and Industry• Sustainability Reporting Standards, Global Reporting
Initiative (GRI)
For the GRI content index, please refer to the link below.
https://www.group.dentsu.com/en/sustainability/common/pdf/GRI2024.pdf

Integrated Report

Planning andproduction

Finance, Business, HR, GovernanceMid-tolong term

Securities Report* Including Quarterly
Financial Statement
TCFD Report

Affiliated divisions
Executive officer in charge

Strategy briefing
material

Past results

Organizations covered: Dentsu Group Inc. and dentsu companies
Publication date: August 2024 (Next edition scheduled
for publication in August 2025)

ESG briefing
material

Corporate
Governance
ReportGroup Sustainability Committee

Target audience: All stakeholders including shareholders
and investors, clients, partners, consumers, and employees.

DEI Report

Production
cooperation

ESG Data Book
Financial Fact Book

Quantitative information
Forward-looking statements:
This integrated report contains statements that constitute forward-looking statements regarding the intent, belief or current expectations ofDentsu Group Inc. or its management with respect to the results of operations and the financial condition of the Group. Such forward-looking
statements are not guarantees of future performance and involve risks and uncertainties. Actual results may differ from those in the forwardlooking statements as a result of various factors. The information contained in this integrated report identifies important factors that could causesuch differences. These forward-looking statements speak only as of the date hereof. Dentsu Group Inc. disclaims any obligation to update or
publicly announce any revisions to these forward-looking statements to reflect future events, conditions, or circumstances.

98