Sustainability Strategy

Strategy

Sustainability Management

Our Approach to Sustainability

Our corporate mission is "Making work more fun and creative" and our corporate vision is "Empowering everyone to work a step ahead." With these goals in mind, we strive to improve the business communication and productivity of small- and medium-sized enterprises (SMEs), and the work-life balance and creativity of all employees by providing cloud-based business chat and DX-related services.

Our innovative SaaS-based services, designed with outstanding usability, provide SMEs with the means and opportunities to utilize IT and DX to solve daily operation and workplace problems, even without IT-savvy human and financial resources. In doing so, we hope to improve the productivity of SMEs in Japan, a market long regarded as sluggish, and achieve social innovation that will empower working people.

We believe that our unique value creation will help achieve a sustainable society, including Goal 8 of the United Nations Sustainable Development Goals (SDGs): "Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all." Such value creation will also serve as the foundation for the sustainable growth of our Group.

*SaaS: Software as a Service, a software distribution model that makes necessary functions available as a service via the Internet

Sustainability System

We have established a system for sustainability and ESG promotion, with the CEO Office, which reports directly to the CEO, as the main department in charge, and the CEO Office Manager, who is an executive, as the person responsible. In addition, we have a system in place for sustainability-related activities and information disclosure using cross-organizational project teams.

Materiality (Key Issues)

Materiality to Achieve Mission/Vision

We examined key issues, from both financial and non-financial perspectives, that our Group should address over the medium to long term in order to achieve our mission and vision. Subsequently, after approval by the Board of Directors, we identified "11 key issues to be addressed to achieve our mission and vision."

This materiality consists of three major categories: "issues related to value creation through business," "issues related to enhancement of value creation infrastructure," and "issues related to solving global social issues." These key issues aim to create unique value by creating superior value creation infrastructure, thereby achieving our philosophy and contributing to a sustainable society. We believe that addressing them will lead to the sustainable growth of our Group and the long-term enhancement of our corporate value.

Materiality to Achieve Mission/Vision

Materiality Identification Process

We established a project team in December 2021 and began analyzing the current state of sustainability and ESG. Based on the results of this analysis, we then began deliberations to identify the Group's material issues in April 2022.
We first created a list of candidate key issues, which comprehensively identifies social issues and needs that are relevant to our Group's business. This list was created based on the following information: our management issues as identified through interviews with the heads of key departments; ESG issues identified through a survey of our current situation from a sustainability and ESG perspective; international norms and initiatives such as the SDGs, UN Global Compact, ISO 26000, GRI, and SDGs Impact Standards; various ESG indices such as SASB; key issues identified by fellow companies in the same industry and others; and other social issues and social needs related to the digital society.

We then developed a short list of 18 key issues based on this initial list, taking into consideration their relation to our company and the apparent and potential risks and opportunities for the sustainable growth of our Group. In preparing the short list, we held discussions with Mari Yoshitaka, the Representative Director of Virtue Design with deep insight into sustainability and ESG issues, kubell CEO Masaki Yamamoto, CFO Naoki Inoue, and others. The results of these multifaceted discussions, which centered around the question of which key ESG issues we should address going forward to achieve our vision, were taken into consideration and reflected in the creation of the short list.

The short list of candidate material issues was evaluated on a five-point scale of importance based on the two axes of "impact on the sustainable development of society" and "impact on the sustainable growth of the Group." Based on this matrix, the project committee and management identified "11 key issues to be addressed to achieve our mission and vision" after a series of discussions.
Going forward, we will appoint materiality owners responsible for addressing the materiality issues we have identified and undertake initiatives to address them.

Opportunities and Risks by Key Issue and Reasoning behind Importance

*This chart can be scrolled horizontally and vertically.

Key Issue	Opportunities	Risks	Reasoning behind Importance
Improving Labor Productivity at SMEs through DX	Increased organizational cohesiveness and employee motivation Positive impact on brand reputation and sales Increased sales	Decreased organizational cohesiveness	The most important value provided to society that is directly linked to achieving our mission and vision; also contributes to SDGs Goal 8, etc.
Creating Human Resources Who Can Work in a Fun and Creative Way	Improved employee job satisfaction Improved labor productivity and value creation Positive impact on acquiring and retaining talented human resources Positive impact on brand reputation Improved employee engagement, reduced turnover	Decreased organizational cohesiveness (if philosophy not put into practice) Lowered employee motivation/engagement Reduced labor productivity Increased turnover	Directly linked to our mission and is the source of creating value and improving competitiveness over the medium to long term
Ensuring Reliable Quality as Business Infrastructure	Improved brand reputation Decreased churn rate Positive impact on sales	Decreased brand reputation Increased churn rate Reduced sales	Ensuring quality appropriate for business infrastructure (excellent usability and continuity of service) is essential for business growth
Advanced Information Security and Privacy Protection	-	Risk of operation stoppage Risk of litigation and damages Major loss for brand reputation Reduced sales	Ensuring information security and complying with local information protection regulations in each country is the foundation of our business activities
Achieving Corporate Governance that Drives Corporate Value Enhancement	Increased management efficiency, enhanced internal controls Positive impact on corporate value enhancement	-	Effective corporate governance that responds appropriately to changes in the market and society is essential for achieving our philosophy and enhancing our corporate value
Conducting Business Activities with Integrity for All Stakeholders	Positive impact on reputation Creation of good relationships with stakeholders Positive impact on organizational culture	Increased compliance risks Negative impact on organizational culture	Being an organization with integrity fosters stakeholder trust and is the basis for achieving our philosophy and sustainable growth
Conducting Sustainability Management to Achieve Corporate Philosophy	Enhanced non-financial competitiveness that supports sustainable growth Improved ESG evaluation	Relative decline in non-financial competitiveness	A management system that appropriately understands and responds to social needs is essential to achieve our philosophy
Becoming a Trustworthy Brand and Enhancing Engagement	Improved brand reputation Positive impact on marketing and recruitment Enhanced relationship with stakeholders	Relative decline in business competitiveness (recognition, marketing, recruitment)	Brand communication centered on our philosophy is essential to achieve co-creation with stakeholders
Diversity Management to Achieve New Value Creation	Become an organization where diverse human resources can actively participate Positive impact on innovativeness Improved organizational resilience	Relative decline in competitiveness due to not being able to use diverse human resources	Creating an organization in which diverse human resources can actively participate is essential to improving organizational innovativeness and resilience
Internationally Recognized Human Rights Standards	Secured social trust Creation of an open workplace	Increased reputation and compliance risks	Respecting human rights is essential for securing the trust of society and creating a joyful working environment for everyone involved in our business
Managing Energy and Addressing Climate Change	Compliance with environmental laws and regulations Enhanced (medium- to long-term) service competitiveness Positive impact on brand reputation Positive impact on employee motivation	Increased (short-term) costs Relative decline in brand reputation	Necessary in order to contribute to solving climate change and provide IT services with less environmental impact to users