Sustainability Report 2024｜booost technologies,Inc.

Transcript

1. To achieve a more sustainable NET -ZERO future Sustainability Report 2024
2. To be the technology partner that creates a future the next generation can be proud of Providing Sustainability ERP for NET-ZERO Leaders to Increase Corporate Value for Clients To achieve a more sustainable NET-ZERO future. Starting with CSRD and ISSB compliance, our sustainability ERP, "booost Sustainability Cloud" has driven the success of global-scale SX projects. We harness technology to make our planet a more sustainable NET-ZERO world.
3. # CEO Messag  Governance and Materiality CSO Message Governance Materiality 1： Materiality 2：Human Capital Materiality 3：
 Materiality 4：Co-creation with Stakeholders Impact on Society Internal Initiatives j Future Developments CONTENTS Product and Service Quality /
 IP Strategy / Data Security Greenhouse Gas Emissions Reduction and Climate Change
4. 1 2 Sustainability issues are becoming more serious yearly, especially the urgent need to address climate change. At the corporate level, regulations, including those regarding the disclosure of non-financial information, are being tightened. However, according to a survey* by the Ministry of Economy, Trade and Industry (METI) of Japan, approximately 70% of companies use Excel to manage non-financial information, and the major issue to rapidly achieve GX/SX is a lack of resources. Through our business activities, we promote GX/SX as a technology partner to our customers, supporting sustainability management that manages non-financial information in the same way as financial values. During the past three years since our product launch, it has been adopted by many enterprises, with approximately 180,000 locations worldwide. We have also established the Sustainability Leadership Community (SLC), creating a network of like-minded individuals who share the same mission. As a Japan-based organization, we are eager to support Japan's goal of achieving carbon neutrality by 2050. Last year, we obtained SBT certification for our GHG emissions reduction targets. We have established an SX Committee and are strengthening our internal sustainability management system. We have made steady progress in recruiting professionals and appointing advisors to help us make further strides. To achieve our mission, we must make contribution to our stakeholders through our business and cooperate with all of them, including investors, customers, partners, and employees. We will continue to be a boooster of the "Sustainability Revolution" to leave a better future for the next generation. Through the power of technology, we strive to promote GX/SX as a way to realize sustainability. Urgent and Strategic Response to Sustainability: Our Approach Promote Company-wide Sustainability Strategy and Fulfill Global Responsibilities ¢¡ CEO Message As a technology partner of Sustainability Leaders,
 we are taking on the GX/SX challenge. We aim to become a boooster of the "Sustainability Revolution." With the mission of " To achieve a more sustainable NET-ZERO future." our company was founded in 2015, the inaugural year of the "Sustainability Revolution." We provide products for managing electric energy and G HG emissions , addressing the greatest challenge in human history —climate change. Since then , we have continued to develop products for supplier and ESG data management , growing steadily as a sustainable tech company. Hirokazu Aoi ＊Ministry of Economy, Trade and Industry, "Survey Results on the Collection and Utilization of Sustainability-Related Data." 　 Referenced on June 20, 202 4, https ://www.meti.go.jp/press/202 3/07/202 30718002/202 30718002- 3.pdf
5.  Governance and Materiality CSO Message Governance Materiality 1： Materiality 2：Human Capital Materiality 3：
 Materiality 4：Co-creation with Stakeholders Product and Service Quality /
 IP Strategy / Data Security Greenhouse Gas Emissions Reduction and Climate Change
6. 5 6  Governance and Materiality Our business is directly connected to achieving sustainability for society and our customers. At the same time, we play a role in creating a system that serves as the foundation for our customers' non-financial information management. We believe that to continuously improve the quality of the products and services we provide to our customers, we must also continuously evolve our own sustainability management. The content of the report was carefully selected with a broad range of stakeholders in mind, including not only investors but also customers, employees, etc., to ensure a comprehensive two-way impact. Additionally, we have obtained third-party assurance for the disclosure of GHG emissions to ensure data accuracy. Amidst this "transformation," where the demand for non-financial information disclosure is steadily increasing, we support our clients to become a sustainability leader by actively evolving their sustainability management and proactive disclosure, while contributing to our stakeholders thus boosting the "Sustainability Revolution." In Publishing This Report Materialities No. Reasons Greenhouse Gas Emissions Reduction and Climate Change Addressing climate change issues is the top priority when considering the sustainability of society and customers. 1 Product and Service Quality / IP Strategy / Data Security As a SaaS business, ensuring the quality and superiority of our products and services through IP strategy and data security (including personal information) is fundamental to our business continuity. 3 Human Capital As a start-up company, it is especially important to manage our employees' psychological safty while developing and maximizing their capabilities. 2 4 Co-creation with Stakeholders Achieving sustainability in society requires collaboration with many stakeholders As a leading company of "transformation" CSO Message We have selected the following four materialities for our activities. Four Materialities and Reasons for Selection Creating better economic, environmental, and social impacts Provide solutions, such as management platforms and best practices for non-financial information, that are directly linked to achieving sustainability management. Lead, boost, and accelerate other companies by setting an example in SX practices, including GHG emissions reduction, management and disclosure of non-financial information. Technology Partner SX boooster Manabu Shibata
7. 7 8  Governance and Materiality The deliberations of the SX Committee are discussed and approved by the Board of Directors. Our management team consists of three internal directors and four external directors, all with expertise in sustainability. In FY23, the Board of Directors met once a month. Additionally, we held management meetings once a week to ensure effective collaboration. We integrate environmental and social perspectives into our business activities to address sustainability challenges, including climate change, and create sustainable business value. To manage these activities with appropriate judgement and control, we have established a governance structure centered on the SX Committee, chaired by the Representative Director with members of the Executive Committee. Working Groups (WGs) are established for high-priority themes to examine issues, formulate and implement action plans. The committee meeting is held quarterly as a general rule and also on an ad hoc basis when there is an urgent agenda. A total of four meetings were held in FY23. Themes Working Groups Activities Governance Structure Centered on the SX Committee Governance Environment Calculation of GHG Emissions Calculation of Scope 1,2,3 emissions Maximizing Human Capital Value Setting Human Resources-Related Goals Policy Review Policy Review for FY24 Data Security Governance Maintenance of ISO 27001 Certification and Privacy Mark Setting Diversity-Related Governance Goals (Percentage of female managers, etc.) Disclosure Press Release on Sustainability Initiatives: GX League, SBTi, RE100
 Sustainability Report Society Governance Board of Directors Executive Meeting Environment 各本部 各本部 各本部 各本部 Division Division Division Division Society Governance Working Groups SX Committee Chair: Representative Director Structure of the SX Committee Activities of Each Working Group
8. 9 10  Governance and Materiality Management Team with Expertise in Sustainability ※ Governance Hirokazu Aoi Representative Director, CEO After leading the Smart Energy Business Team at one of Japan's top consulting firms, Hirokazu Aoi founded booost technologies, Inc. in April 2015. With extensive experience in smart energy consulting, he has been building his expertise in the industry since 2010. He is well-versed in energy creation, energy conservation, and energy management, which are essential solutions for decarbonization. No.1 ESG and GHG Software market share in Japan after 1.5 years of release Manabu Shibata Executive Officer, CSO As the former General Manager of the ESG Promotion Division at Kao Corporation, Manabu Shibata led the company to become the only Japanese company receiving CDP Triple A rating three years in a row. He was responsible for overseeing environmental and human rights affairs. After his successful tenure at Kao, he joined booost technologies. He has extensive experience in human rights activities and various environmental fields, including, but not limited to, energy and GHG management, renewable energy, plastics, water management, and LCA assessment. Joined booost technologies after serving as General Manager of Kao ESG Promotion Division Takeshi Oga Director, COO Former Managing Executive Officer and Chief Transformation Officer of SAP Japan. After working for Oracle Japan, a foreign consulting firm, and SAP, Takeshi Oga joined booost technologies in January 2023. At SAP, he launched and managed several new businesses, including a sustainability solutions business and a co-creation business between large companies and start-ups. He also led the company's mid-term transformation. Joined booost technologies after serving as Managing Executive Officer of SAP Japan Takeshi Hagiwara Executive Officer, General Manager of Future Design Division and IP Strategy Dept., Patent Attorney Takeshi Hagiwara was engaged in international NGO activities related to human rights and rights of indigenous peoples. He then joined one of Japan's top information security software manufacturers as a corporate planning staff member, where he managed budgets and researched overseas business development. 
 He later worked as a patent attorney at a firm specializing in IT and telecommunications, representing major domestic and international companies in patent matters. Won the Incentive Award at the IP BASE AWARD sponsored by the Japan Patent Office and led the selection of PACT/WBCSD Technology Partner Norihiro Takatsuka Executive Officer, CTO As a former Senior Project Manager at NTT Data Corporation, Norihiro Takatsuka led numerous projects. He has promoted AI joint research with top Japanese universities, including the University of Tokyo and Kyoto University, as well as NTTG. He managed projects with a budget of 2 billion yen, overseeing them from consulting to service launch. He is a certified Database Specialist (certified by Information-technology Promotion Agency, Japan, government certification) and a PMP Project Management Professional (certified by PMI, a U.S. non-profit organization). Engaged in the development of national core systems and AI development ※Deloitte Tohmatsu Mic Economic Research Institute, 　 "Market Trends of ESG Information Disclosure Solutions Promoting Environmental Management, FY2022 Edition (Published in February 2023)" https://mic-r.co.jp/mr/02670/ 　 Vendor Sales/Share Trends for Overall ESG Information Disclosure Solutions, Vendor Sales/Share Trends for GHG Emissions Visualization Solutions
9. 12  Governance and Materiality COO Message Greenhouse Gas Emissions Reduction and Climate Change Materiality 1 We are committed to improving the environmental and social value that companies bring to society through our practices and by supporting our clients. Internally, we have acquired SBT certification and are working to reduce GHG emissions. Externally, we provide sustainability ERP to improve corporate value by standardizing the management process of non-financial information. Financial information is well-managed monthly at each company, and leading indicators can be checked when necessary. On the other hand, non-financial information is only managed annually due to the significant time and effort required for data collection process. In addition, to achieve reduction and improvement, instead of the granularity of information for disclosure, a higher granularity is required to identify problems and formulate improvement plan. Through the power of technology, we efficiently aggregate vast amounts of scattered non-financial information and visualize it at a granular level that leads to improvements. By utilizing this approach, the PDCA cycle can be operated on multiple short-term cycles rather than once a year, which enables the integration of sustainability management into regular operation. We aim to drive the acceleration of GX/SX. From visualization for disclosure to visualization for reduction Takeshi Oga Monthly Report Tracking leading indicators Shorter PDCA cycle Non-Financial Information Management Accelerate GX/SX through Sustainability ERP Complicated data collection Annual performance monitoring Annual PDCA cycle Greenhouse Gas Emissions Reduction and Climate Change Materiality 1 COO Message booost technologies: Business and Achievements I Development and Provision of sustainability ERP, "booost Sustainability Cloud& I ARR Growth Trend and KPI I Our GHG Emission Reduction Target€ I First Japanese Company to Obtain SBT Certification for the 2035 NET-ZERO Targeh I Visualization and Reduction of Our Company's GHG Emissions booost technologies' Emission Calculations Financial Information Management
10. 13 14  Governance and Materiality Our Business and Achievements Greenhouse Gas Emissions Reduction and Climate Change Materiality 1 Our most significant impact on climate change comes from our sustainability ERP, "booost Sustainability Cloud." This product enables us to efficiently and accurately visualize non-financial information, including GHG emissions from our customers and their suppliers, and to take action to reduce these emissions. Consequently, it accelerates our customers' essential GX/SX initiatives and contributes to enhancing their corporate value, including environmental value. The system can be flexibly implemented to suit each company's objectives, streamlining and optimizing sustainability-related operations. An "Integrated SX Platform" developed by booost to realize the innovative "Best Practice." It significantly contributes to the acceleration of SX and GX for global leaders who seek to enhance corporate value in respond to CSRD and ISSB requirements. · Adopted by hundreds of large consolidated groups · Creating a To-Be model based on best practice developed by leading sustainability companies which shortens project duration and increases the likelihood of success. · Efficiently handle third-party assurance, which becomes more burdensome and costly every year. Development and Provision of sustainability ERP, "booost Sustainability Cloud" "Sustainability ERP" for a Successful SX Project "booost Sustainability Cloud," a product that embodies Sustainability ERP Best Practice of Leading Sustainability Companies Recognized by auditing firms that provide third-party assurance Adopted by hundreds of large consolidated groups Sustainability ERP Data Analysis Management Shareholders Evaluation Agency · SX Management StrategE · Global Governanc8 · Maximizing Opportunities / Minimizing Risks · Non-financial KPI Managemen · Integration with Financial KPI · Promoting SX Implementation Initiativer · Third-Party Assurance Complianc8 · Prompt Response to Various Disclosure Requests · Automating the collection and aggregation of datay · Supplier Management Audit Firm Financial and Non-financial Databases Non-financial Data Division A Division B Division C Whole Group Supplier Worldwide worksites Data Merging Data Aggregation Data Collection Real-time Monitoring Sustainability ERP Centralized Management of SX Activities Across the Entire Group
11. 15 16  Governance and Materiality Greenhouse Gas Emissions Reduction and Climate Change Materiality 1 booost Sustainability Cloud is adopted by approximately 180,000 locations (as of July 2024) which account for about 7.8% of Japan's total greenhouse gas emissions. It is customized to meet the standards of enterprise companies across various industries. More than 80% of customers are listed companies with sales of 100 billion yen or more, and we have good reputation among enterprise companies. Our Business and Achievements We are holding the No.1 ESG and GHG Software market share in Japan and we will continue to expand the adoption by enterprise companies and their suppliers strategically. Highly Trusted by Sustainability/NET-ZERO Leaders High reputation and achievment among large listed companies ※1 Market Share of GHG Emissions Visualization Solutions ※1 ※1 Market Share of ESG Disclosure Solutions No. No. 1 1 ※2 80k 1 7.8 Number of Locations with Utilization Records Market Share of GHG Emissions ＋ %＋ ※3 58 80 Total Market Capitalization of Users Trillion yen %＋ Revenue Composition Ratio of Companies with Sales Over 100 Billion Yen in Sales Information and Communication Services Machinery and Electronics Materials and Chemicals Retail and Wholesale Trading Companies Finance and Insurance Construction Transportation and Railways ※1. Deloitte Tohmatsu Mic Economic Research Institute, 　 　 "Market Trends of ESG Information Disclosure Solutions Promoting Environmental Management, FY2022 Edition (Published in February 2023)" https://mic-r.co.jp/mr/02670/ 　 　 Vendor Sales/Share Trends for Overall ESG Information Disclosure Solutions, Vendor Sales/Share Trends for GHG Emissions Visualization Solutions ※2. GHG Emissions Share = Total Emissions of booost's Customers / Japan's Total GHG Emissions ※3. The combined market capitalization of our customers (as of November 2023) In FY23, ARR (Annual Recurring Revenue) increased significantly, about 2.9 times comparing to previous year. The KPI for FY24 is to achieve an ARR approximately three times the previous year. To mitigate global warming and climate change, we strive to achieve our ambitious goal through our business of managing non-financial information, including GHG emissions. ARR significantly increased ARR Growth Trend and KPI FY22 FY23 2.9 x
12. 17 18  Governance and Materiality Greenhouse Gas Emissions Reduction and Climate Change Materiality 1 As mentioned previously, our company is committed to accelerating GX and SX for industry leaders in various sectors and leading the way toward NET-ZERO. We believe that it is essential to also take the lead in achieving NET-ZERO within our own business operations. Additionally, despite being a start-up, we are proactively addressing the forthcoming mandatory disclosure of sustainability information. We are leveraging our products and services to work on disclosure and reduction, embodying a carbon-neutral business model and demonstrating the way forward for corporate activities. booost technologies' Emission Calculations Our NET-ZERO target has been certified by the international initiative SBTi (Science Based Targets initiative). ※This target is also disclosed in the "GX League" 　 https://dashboard.gx-league.go.jp/company/7010001167327/ We have decided to achieve NET-ZERO in 2023 for GHG (Scope 1 and 2) emissions from our activities and in 2025 for GHG emissions, including supply chain. We achieved NET-ZERO for GHG emissions, including supply chain emissions, in 2023, earlier than the target year, and will continue to maintainv NET-ZERO status after the target year. Furthermore, within our certified targets for reducing greenhouse gas emissions, we have declared a goal to achieve NET-ZERO by 2035. We are proud to be the first Japanese company to receive this recognition. Our GHG Emission Reduction Targets First Japanese Company to Obtain SBT Certification for the 2035 NET-ZERO Target Additionally, we have newly established affiliations with the following organizations in fiscal year 2023 24/7 Carbon-Free Energy Compact Participated in September 2023 30by30 Alliance Participated in October 2023 Taskforce on Nature-related Financial Disclosures(TNFD) Forum Participated in October 2023 Renewable Energy 100 Declaration RE Action Participated in August 2023 UN Global Compact Global Compact Japan Network (UNGC、GCNJ) Participated in September 2023 Reduce Scope 1+2 emissions 42% by FY30 (compared to FY22) SBT Certified Greenhouse Gas Emission Reduction Targets Short-term target Reduce Scope 1+2+3 emissions 90% by FY35 (compared to FY22) SBT NET-ZERO target 【First Japanese Company】
13. 19 20  Governance and Materiality Greenhouse Gas Emissions Reduction and Climate Change Materiality 1 booost technologies' Emission Calculations Since fiscal year 2021, we have been calculating our company's GHG emissions using "booost GX." The results are as follows. In FY23, we achieved NET-ZERO. Also, FY23 results have been verified through third-party assurance. Assurance Report Visualization and Reduction of Our Company's GHG Emissions FY Scope1 Sub Total Scope Scope2 Total unit: t-CO2e Scope3 2021 2022 2023 0 0 0 1 - 2 1 - 3 1 - 3 22 15 16 22 491 249 - 476 234 ※1 ※2 ※3 ※1. Market-based approach. ※2. Before applying environmental values. After application: 9 t-CO2e. ※3. Before applying environmental values. After application: 0 t-CO2e. Additionally, FY23 location-based scope 2 emissions (national average) 17 t-CO2e, location-based scope 2 emissions (default value) 17 t-CO2e
14. 22  Governance and Materiality Human Capital Materiality 2 Human Capital Materiality 2 Message from the General Manager of Future Design Division Gathering professionals to foster an environment where they can fully realize their abilities and potential. Takeshi Hagiwara Our company upholds seven core values to shape a team of professionals. Each employee, while possessing expertise in their respective fields, focuses on maximizing results through cross- departmental and cross-functional collaboration. Our company is committed to tackling global challenges and providing value to society. To realize this business strategy, extensive knowledge of sustainability and a deep understanding and commitment to our strategy are essential. Embodying these through our core values is crucial. For each department and individual to achieve results aligned with our business strategy, it is essential to maintain "intellectual humility" by consistently staying updated on the latest trends and continually integrating new knowledge. To innovate with each employee's knowledge and contribute to the realization of our business strategy, it is essential to bring together professionals from diverse fields, maximize their capabilities, and ensure effective collaboration across the organization. Each employee's talent, passion, and professional knowledge are the sources of our company's collaborative strength and innovation. We enhance the value of our human capital by providing an environment where employees can fully realize their potential. Message from the General Manager of Future Design Division I The Seven Core Value8 I Productivity (Becoming a Professional Team% I Leadershi$ I RecruitmenA I Promoting Women's Empowerment
15. 23 24  Governance and Materiality Human Capital The Seven Core Values Materiality 2 01 05 03 07 02 06 04 Professional Team Individual Strengths Boldness and Sensitivity Ownership Adaptability Speed Problem-Solving Ability We prioritize acquiring unparalleled domain knowledge and skills to achieve the highest possible results and focus on delivering results as a team. We remain humble and act with a genuine mindset, considering the overall harmony to produce outstanding results as a professional team. The answer "I can't do it" produces no value. With an unparalleled problem-solving mindset, we constantly consider the optimal means and shortest time to achieve our goals, ensuring completion and delivering results. By vastly enhancing individual strengths, continuously driving transformation, and maximizing our potential, we provide value to the company and society while shining as individuals. We think broadly, deeply, and meticulously. We provide bold directions and policies while always paying attention to and understanding the details on the ground. To enhance business value for the planet, society, and customers, we act beyond our own roles and positions, execute our missions, and take responsibility for achieving results. S ociety is constantly changing and full of uncertainty. With a mindset of "I will find a way, no matter the environment," we execute our missions. S ocietal change is rapid, and we will create value and accomplish our mission even more swiftly. To achieve this, We establish and adhere to strict deadlines. C hange the world with unparalleled thinking, talent, technology, and solutions. A professional team that continuously evolves. ｢ booost ＝ U nparalleled Ex cellence ｣ We implement the following measures at our company to enhance productivity and transform into a professional team. These measures lay the foundation for employees to fully leverage their professional capabilities and form a highly productive team. Through these efforts, we strive for sustainable growth and value creation for society. We support employees in deepening their expertise and pursuing certifications, promoting individual skill development and career growth, and enhancing the organization's overall expertise. We offer a range of educational opportunities from onboarding to ongoing professional development, including courses conducted by our employees and external instructors, to support the continuous growth of our staff. By utilizing no-code/ low-code tools and A I technologies in our operations, we enhance efficiency and create an environment where employees can focus on more creative tasks, thereby enabling high performance.
 We pursue sustainable growth and innovation by expanding the application of A I technology through certification allowances and courses offered at booost A cademia. This initiative aims to facilitate the sharing of knowledge among employees and promote the accumulation of collective knowledge and innovation. Through this effort, we enhance the intellectual maturity of the entire organization, and create a learning community, providing an environment where each employee can grow as an active learner. A dditionally, we have established a company library where employees can borrow books recommended by the management team and the human capital group. E co Test (C ertification Test for E nvironmental S pecialists)® LCAF : LCA C ertification E xam EFFAS C ertified ESG A nalyst® (CESGA) S ustainable M anagement Test [S ustainable M anagement/CSR Test] C ertificate in ESG Investing FSA® C redential C arbon A ccounting A dvisor C ertification G enerative A I Passport G X C ertification E xam JDLA Deep L earning for GE NERAL JDLA Deep L earning for E NG INEER etc. E xamination F ees and Textbook C osts A s of January 2024 17 Productivity (Becoming a Professional Team) C ertification A llowance booost A cademia Introduction of IT Tools C umulative number of applications R ecommended C ertifications A llowance item
16. 25 26  Governance and Materiality Our company's leadership is built on the foundation of fairness and transparency, emphasizing diversity and inclusivity. We foster a workplace culture of equality and respect by conducting regular harassment prevention training. These training which aims to enhance awareness and create an environment where employees can support and respect each other. To discover and develop the next generation of management talent, we have established a system that enables cross-level challenges. This system allows employees to fully realize their potential and fosters their growth as future leaders. Through these efforts, we aim to achieve fair leadership that respects diversity and drives innovation and growth across the organization. At our company, we hire all employees as mid-career professionals. Moving beyond homogeneous groupthink, we treasure people from different backgrounds who empathize our mission with high passion. By hiring individuals who fit our company culture, we have assembled a team of diverse and highly skilled professionals, forming an elite, high-caliber group. The average age of our employees is 35. We actively hire foreign employees, especially in specialized roles such as engineering and consulting. As of the end of January 2024, the proportion of foreign employees was 4%. Additionally, many of our employees have children; the paternity leave uptake rate in 2023 was 50%. The overall paid leave utilization rate across the company, including part-time employees, is 75%, reflecting our commitment to promoting work-life balance. We are working towards creating a more supportive environment for women and increasing the proportion of female managers. As part of our FY24 key initiative, Human Capital Management 3.0, we are utilizing recruitment agencies that specialize in supporting working women who aspire to management positions. As part of this initiative, we conduct regular health check-ups, provide guidance on managing chronic conditions, and offer financial support for influenza vaccinations to ensure our professional staff can perform optimally. Additionally, we strengthen our efforts to maintain and improve women's health by offering financial assistance for screenings related to cervical and breast cancer. By making various health investments for our employees, we are working to reduce health risks and enhance performance and engagement. Human Capital Materiality 2 Leadership Recruitment Promoting Women's Empowerment Occupational Composition Corporate Consulting Product Business 10% 8% 37% 45% As of July 2024 (excluding directors) As of December 2023 As of December 2023 As of July 2024 35 50 4 Average age of our employees Percentage of paternity leave taken Percentage of foreign employees % %
17. 28  Governance and Materiality Product and Service Quality / IP Strategy 
 / Data Security Materiality 3 Product and Service Quality / IP Strategy / Data Security Materiality 3 CTO Message h Product and Service Quality Update Systef h IP Strateg“ h Data Security CTO Message Promoting GX and SX through product growth Norihiro Takatsuka Since our founding, we have been committed to developing products for Japan's leading enterprises. We have also worked alongside our clients as technology partners to tackle complex challenges in the sustainability domain. Various types of non-financial information, including GHG emissions, require data management and reporting according to specific rules. Additionally, the business processes involve numerous stakeholders, making it extremely challenging to build and operate systems that balance accuracy and speed. We actively participate in domestic and international rule-making forums and are dedicated to directly addressing our clients' core challenges. We strive daily to provide products that maximize our clients' corporate value. We will continue to advance our products as the infrastructure for non-financial information, expanding the adoption domestically and internationally. By doing so, we aim to promote GX and SX in Japan and worldwide, achieving true sustainability.
18. 29 30  Governance and Materiality Product and Service Quality / IP Strategy / Data Security Materiality 3 Our vision is "To be the technology partner that creates a future the next generation can be proud of," and our mission is "To achieve a more sustainable NET-ZERO future." Achieving the SDGs by 2030 and carbon neutrality by 2050 are essential for creating a future we can be proud of for current and future generations. The number of intellectual property creations related to our suite of products, "booost Sustainability Cloud" and its associated solutions, future technologies, and services, is as follows (as of June 2024): We define "Intellectual Assests" (Inclusive IP) as a comprehensive term that includes not only intellectual property but a broader range of intangible assets which are positioned as the core of our mission and vision. We will realize this future by transitioning to a "more sustainable and NET-ZERO world," where everyone can access clean, equitable energy in a safer, more convenient, and abundant manner. IP Strategy Positioning of Our Intellectual Assets Number of Intellectual Property Creations In non-financial information disclosure, domestic and international regulations are frequently updated due to strengthened rules. Companies using our solutions must adapt to these changes while building their "system structures" and "operational frameworks" for data collection. We are affiliated with the following organizations and actively participate in global and national discussions to contribute to the development of future standards for data collection and collaboration. We continuously incorporate these insights into our products and services, to remain the best partner that provides optimal solutions to our customers. We are a member of the IFRS Sustainability Alliance and are well- versed in the latest international sustainability disclosure standards and initiatives. The IFRS Foundation is a private, non-profit organization responsible for developing International Financial Reporting Standards (IFRS). We are the first Japanese start-up to join the IFRS Sustainability Alliance, and through proactive participation, we are continuously strengthening our sustainability-related business activities. We were selected as Japan's first global partner in developing international rules for GHG emissions data exchange. WBCSD comprises over 200 prominent corporate CEOs globally, collaborating to contribute to the transition towards a sustainable society. PACT, an initiative formed by WBCSD, aims to achieve decarbonization through true transparency of carbon emissions in the supply chain. We are the only GHG emissions visualization tool provider to be selected as the steering committee member. The Green x Digital Consortium, managed by the Japan Electronics and Information Technology Industries Association (JEITA), promotes corporate carbon neutrality and develops digital solutions that drive industry and societal transformation. Companies from various industries and sectors participate in group activities and demonstration experiments. Product and Service Quality Update System 135 58 13 64 Number of Intellectual Property Creations Number of Patent Applications Number of Design Registration Applications Number of Trademark Registration Applications (25 patent examinations/decisions) (8 Assessed/Decision rendered) (49 Assessed/Decision rendered)
19. 31 32  Governance and Materiality We crystallize and leverage our individual ideas into intellectual assets (Inclusive IP) and innovate the energy industry to create a more sustainable, NET-ZERO future that we can be proud of for future generations (Ideal future & world). We encourage and foster individual creativity. The source of intellectual assets is the individual "person." Each of us accurately captures customer needs and social issues, generating valuable ideas for the future in collaboration with trusted partners and external experts. ™ We define and practice the seven core values to help individuals become "exceptional" in their rolesŽ ™ We incorporate "design management" into our operations, designing business activities based on customer needs and creating technologies that lead to innovationŽ ™ We stimulate individual's creativity by the establishment of Employee Invention System. We strengthen our intellectual assets, not only IP rights but also know-how, by promoting information exchange among employees and internal and external collaborationsŽ ™ We create mechanisms to turn ideas into intellectual assets by connecting ideas from members involved in research and development and members of departments that are sensitive to customer needs and social issues. Our intellectual asset strategy (IP Strategy) connects five I's (Individuals, Ideas, Inclusive IP, Innovations, Ideal future & world) to a future we can be proud of for the next generation through four I's (Inspiring, Integrating, Initiating, Implementing) steps. Product and Service Quality / IP Strategy / Data Security Materiality 3 Intellectual Asset Strategy: Future-focused "5Is with 4Is Steps" 01 STEP Inspiring Individuals to create Ideas 4ls Steps 5ls Individuals Ideas Inclusive IP Innovations Ideal future & world IP Strategy 01 STEP Inspiring 03 STEP Initiating 02 STEP Integrating 04 STEP Implementing We comprehensively harness and protect "intellectual assets" to transform ideas into innovations. Inclusive IP／Comprehensive "Intellectual Assets" We integrate ideas as intellectual assets. Intellectual assets are the result of the crystallization of numerous ideas. Our intellectual assets encompass not only intellectual property such as technology, design, brand, know-how, big data, and programs but also insights related to customer needs that serve as sources of competitive advantage. They also include experience and knowledge cultivated in business, information collected and accumulated daily, and our organizational strength and external networks. ™ Our strength lies in our ability to stay ahead of the latest information on pressing issues such as climate change and ESG, as well as developments of the rapidly changing energy industry. By sincerely addressing the needs of our customers, we build valuable systems and product functions, such as one-stop servicesŽ ™ We have created an environment where the relatively young generation, mainly in their 20s to 40s, can freely express their opinions about our businessŽ ™ Our IP mix strategy leads to innovation and branding through business design centered on customer- oriented design managementŽ ™ We aim to achieve stable and robust intellectual property management that solves social issues and meets customer needs through an open-close strategy that identifies core competenciesŽ ™ We respect the intellectual assets of others and strive to create open intellectual assets through collaboration with external parties. 02 STEP Integrating Ideas into Inclusive IP IP Landscape IP Value Evaluation Design Know-how Technology Programs Modeling Big Data Brand Culture Comprehensive "Intellectual Assets" Inclusive IP Feedback ( Knowledge Cycle) Ideas Innovation Innovations
20. 33 34  Governance and Materiality Product and Service Quality / IP Strategy / Data Security Materiality 3 We drive innovation through intellectual assets. Intellectual assets are tools for driving innovation. We collect, organize, protect and expand our intellectual assets and utilize them to generate innovations that transform the society. 03 STEP Initiating Innovations with our Inclusive IP booost GX Decarbonization Platform to Accelerate Decarbonization Management Facilitating Data Integration Across the Supply Chain Managing ESG Information to Enhance Corporate Value Achieving Energy Management Patent No.7132580、Patent No.7178064 etc. booost ESG appl. No. 2022-187122、appl. No. 2022-192541 etc. booost Supplier appl. No.2023-008282 (Patent Granted) appl. No. 2023-001983 etc. booost Energy Patent No.6945893、Patent No.7046322 etc. "booost Sustainability Cloud," a product that embodies Sustainability ERP We achieve an ideal future by implementing innovation in society. Our IP exists to realize our mission and vision. Upholding our mission "To achieve a more sustainable NET-ZERO future," we strive to create a convenient, comfortable, safe, secure, and prosperous life through innovation. Additionally, under our vision of "To be the technology partner that creates a future the next generation can be proud of" we aim to achieve the following goals through innovation: 04 STEP Implementing Innovations for Ideal future & world Our four-steps intellectual asset strategy is designed to achieve these missions, visions, and goals. By crystallizing individual ideas into intellectual assets through connections with customers, partners, external experts, and the broader society, we drive innovation to accomplish these missions, visions, and goals. Achievement of SDGs by 2030 Achievement of carbon neutrality and NET-ZERO by 2050 ñ We respect the intellectual assets of others as much as our own. We strive to prevent and avoid any actions that might harm the intellectual assets of other companies or individuals. â ñ We have established a department responsible for overseeing the creation, management, protection, and utilization of intellectual assets (IP Strategy Department) to maximize their effective useÞ ñ Through our intellectual assets, we contribute to providing value to our customers and the development of regional, national, and global industries, environmental conservation, and the enhancement of culture. Management of Intellectual Assets Ever since our founding, we have placed a strong emphasis on security in the design of our products, services, and organizational operations. Given that our products and services handle non-financial information for our customers, it is crucial to ensure that data is kept secure and private. We have always upheld zero security incidents. Our software and IT services ensure data protection through encryption technologies. We implement security policies that are compliant with industry standards and enforce strict access management to maintain confidentiality, integrity, and availability. To address ever- evolving threats, we continuously monitor and improve our systems, conduct regular security training for employees, and perform comprehension tests during onboarding at least once a year. Additionally, we hold third-party certifications such as "ISO 27001/ISMS" and "Privacy Mark" and diligently maintain these certifications. Data Security
21. 36  Governance and Materiality We have established the following policy to build trust with our suppliers and contribute to the creation of a sustainable society through innovative ideas and solutions: Co-creation with Stakeholders Materiality 4 Formulation of Sustainable Procurement Policy Co-creation with Stakeholders Materiality 4 Formulation of Sustainable Procurement Policy Inauguration of SLC We adhere to laws and corporate ethics, conducting fair and equitable selection and transactions with a strong emphasis on social responsibility. Ethical Transactions We engage in procurement activities considering decarbonization, environmental preservation, labor conditions, human rights, and information security. Commitment to Social Issues We aim to build sincere cooperative relationships with suppliers for mutual growth to tackle social and environmental issues through communication and information gathering. Collaboration with Suppliers
22. 37 38  Governance and Materiality In February 2023, we established the "Sustainability Leadership Community (SLC)," a group of professionals dedicated to advancing sustainability. Within approximately one year of its founding, the community has expanded to 508 members and 357 affiliated companies (as of July 2, 2024), making it one of Japan's largest sustainability communities. Around 100 participants gather at our regularly held in-person events. Through keynote speeches, panel discussions, and networking receptions, we facilitate the exchange of the latest case studies, information related to daily operations and challenges. This networking fosters the acceleration of corporate sustainability management. Co-creation with Stakeholders Materiality 4 Inauguration of SLC Operating a Community of Sustainability Leaders 508 100 357 Number of SLC Members Activities Speakers at Past Events The 4th Event Number of participants in regular In-Person events + Number of SLC member organizations and companies Online Interaction Events Content Distribution We invite community participants to join an online community, providing a platform for interaction. We set sustainability-related themes every three months and hold regular meetings. We also plan to organize voluntary learning sessions. We periodically distribute newsletters via email and business communication tools. OMRON Corporation Co-Representative of Japan Climate Leaders' Partnership (JCLP) Sumitomo Mitsui Trust Bank, Limited Bridgestone Corporation Rakuten Group, Inc. Askul Corporation Kao Corporation Managing Executive Officer, Senior General Manager, Global Investor & Brand Communications HQ and Sustainability Executive ESG Solutions Planning and Promotion Department, Supervisor Executive Director, Global Sustainability Strategy Manager - ESG Communication, Sustainability Manager, Green Product Management, Merchandising Headquarter General Manager, ESG Managing Committee Mr. Tsutomu Igaki Ms. Kaori Miyake Mr. Akihiro Inatsugi Mr. Shoichiro Watanabe Ms. Kaho Miyamoto Mr. Masakatsu Takahashi
23. Impact on Society Internal Initiatives )1 Future Developments
24. 41 42  Future Developments We will continue to hold regular SX committee meetings, report progress in each working group, and cycle through the PDCA process to accelerate internal SX efforts. Our priority is to reduce office electricity consumption, which is the major energy use of our business. We will focus on improving office efficiency and fostering greater energy-saving awareness among employees. Additionally, we will purchase non-fossil certificates for the electricity we used to add environmental value. As part of our efforts regarding the supply chain, we will focus on enhancing the calculation of Scope3 emissions while examining measures on categories with significant impact (1: Products and Services, 6: Business Travel, 7: Commuting). Additionally, we will accelerate value creation and awareness of challenges for downstream customer companies within the supply chain by expanding booost Sustainability Cloud and other initiatives. We become the technology partner of our customers and provide solutions that lead to the success of their SX projects. Society particularly pressures enterprise companies to address sustainability. To advance SX and sustainability management, including compliance with CSRD and ISSB, these companies must collaborate with numerous locations, group companies, and suppliers across different countries. Based on our implementation experience with hundreds of large corporate groups and best practices developed by leading sustainability enterprises, we assist customers in envisioning their "To Be" state. Our solution helps to shorten project duration and increase the likelihood of success. In ESG information disclosure, "independent third-party assurance" is increasingly becoming a critical criterion for assessing reliability. Our solution provides global support for "independent third-party assurance" and achieves integrated management of non-financial information. By building a foundation to implement the PDCA cycle effectively, we guide SX projects to success and contribute to enhancing our customers' corporate value. Impact on Society Internal Initiatives Transition Strategy for GHG Emissions Scope1 Scope2 Scope3 2023 2024 2025 2030 Maintain zero direct emissions Scope1,2 NET-ZERO The ratio of Excel in collecting, aggregating, and analyzing sustainability data The status of GX and SX efficiency initiatives still needs to be improved. Manages own non-financial information effectively. Step1 SX 1.0 Manages non-financial information across the supply chain. Step2 SX 2.0 Demonstrate the impact of SX in terms of financial value. Step3 SX 3.0 As is Despite the push for more detailed disclosure content and rapid disclosure, the information is still managed using Excel. To be Become a leader in SX and GX to enhance corporate value. Scope1,2,3 NET-ZERO  Implementation of energy-saving activities in the offic  Purchase of non-fossil certificates  Formulation of environmental policy for procurement and requests to supplierH  Advancement of Scope3 calculatioA  Raising awareness of sustainability issues among all stakeholderH  Disclosure of GHG emissions from the use of our productH  Provision of offset credits Maintain NET-ZERO Maintain NET-ZERO NET-ZERO measure implementation NET-ZERO measure implementation ＊Ministry of Economy, Trade and Industry, 　 "Survey Results on the Collection and Utilization of Sustainability-Related Data." Referenced on June 20, 2024, 　 https://www.meti.go.jp/press/2023/07/20230718002/20230718002-3.pdf 70 % Approx. ＊ Company E S G E S G E S F G Company Company Supplier Supplier