Environment (E)

Policy

We will contribute to environmental conservation through the provision of IT services, as well as work to improve the efficiency of resource utilization and reduce the environmental impact of our business activities in order to make a decarbonized society a reality.

Tackling Climate Change

The System Support Group is implementing activities to reduce CO₂ emissions through the use of renewable energy and other means. We are also working to improve our disclosure system and CDP score in line with TCFD.

TCFD Disclosures

Governance

The System Support Group has established a Sustainability Committee, chaired by the President and Representative Director, to consider and implement measures concerning sustainability. It meets in principle once every six months.
The Committee plans, examines, and formulates measures related to sustainability, including measures to address climate change, and promotes activities to realize the Basic Sustainability Policy. The activities of the Committee are reported to the Board of Directors, which provides supervision and guidance for the realization of the Basic Sustainability Policy.
During the fiscal year ended June 30, 2025, the Committee met twice to discuss the topics outlined below. It also reported to the Board of Directors twice.

*Activities prior to 2024 are those undertaken by the Sustainability Committee established at System Support Inc.

Month Held	Topics of Discussion
November 2024	Reporting on objectives related to human capital Reporting on climate change measures
May 2025	Reporting on the structure of the Sustainability Committee Reporting on objectives related to human capital Reporting on climate change measures

Strategy

Our Group considers climate change action to be a vital business priority, essential for our sustainable growth. To understand the impact of climate change on our business, we have conducted a scenario analysis based on the recommendations of the TCFD. Through this process, we have identified climate-related risks and opportunities and are striving to strengthen our business resilience. At the same time, we are working to reduce our environmental impact to contribute to the sustainable development of society.

i. Overview of Scenario Analysis

Based on reports from the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC), we have selected two climate scenarios for our analysis: a 1.5°C and a 4°C global temperature rise by the end of the century over pre-industrial levels. We have analyzed and assessed the business impact of transition risks and opportunities under the 1.5°C scenario, and of physical risks under the 4°C scenario.

ii. Identification and Assessment of Risks and Opportunities

Category of Risk/Opportunity			Time Horizon^※１	Impact from Climate Change	Impact Level^※2	Response Plan
Risk	Transition	Regulatory/Policy	Short- to Medium-term	Introducing a carbon tax will raise our operating costs by creating new charges based on our emissions. Furthermore, we expect suppliers to pass on their own increased costs through higher procurement prices.	Low	Drive emissions reduction by adopting renewable energy. Participate in emissions reduction programs, such as carbon offsetting.
			Medium- to Long-term	Growing demand for carbon offsets to meet emissions targets will push credit prices higher, making it more expensive to reduce emissions.	Low	Drive emissions reduction by adopting renewable energy. Explore the use of various credits.
			Short- to Medium-term	Stricter GHG emissions reporting obligations will mean a broader scope, more frequent reporting, and increased verification. This will add to our operational workload and increase operating costs.	Low	Develop internal systems to calculate and manage emissions, drive reduction efforts, and handle all related disclosures. Implement a GHG emissions management tool.
			Medium-term	Stricter energy conservation laws will require office tenants to upgrade to more efficient equipment and adopt better energy management practices, increasing their capital investment.	Low	Consider installing energy-efficient equipment and systems.
			Medium- to Long-term	We face the risk of shareholder lawsuits if we fail to disclose critical climate information or provide false reports. Being held legally liable in such cases would result in significant response costs.	Low	Develop and promote a robust system for managing our climate-related initiatives and disclosures.
		Technology	Medium- to Long-term	Keeping pace with advancements in decarbonization technology and the acceleration of DX will require greater investment in R&D as well as in securing and developing talent.	Low	Expand our training programs to attract and develop talent.
		Technology	Medium- to Long-term	With growing customer demand for energy-saving and decarbonization solutions, we risk losing business if we don't invest adequately in service development or if we fall behind schedule.	Low	Strengthen our methods for understanding customer needs and tracking market trends.
		Market Competitiveness	Medium- to Long-term	Tighter regulations on energy use and a growing share of renewables will drive up our electricity procurement costs. We also anticipate that suppliers will pass on their own cost increases to us.	Low	Work with building management and electricity providers to identify and evaluate efficiency plans and new equipment options.
		Market Competitiveness	Medium- to Long-term	Policies promoting Zero-Energy Buildings (ZEB) will drive up demand for green office spaces, causing office rents to rise.	Low	Work with building management and electricity providers to identify and evaluate efficiency plans and new equipment options.
		Reputation	Medium- to Long-term	If we fall behind on GHG reduction efforts, or if our initiatives and disclosures are seen as insufficient, our reputation with customers and investors could suffer. This could lead to lost business and make it harder to secure financing.	High	Develop internal systems to calculate and manage emissions, drive reduction efforts, and handle all related disclosures. Advance GHG reduction initiatives. Ensure ongoing disclosure to stakeholders and continuously improve our reporting.
	Physical	Acute	Short- to Long-term	The increasing severity of natural disasters due to climate change could damage our facilities and data centers, leading to higher costs for repairs and reconstruction.	Low	Locate facilities and data centers in areas identified as low-risk on hazard maps. Develop a Business Continuity Plan (BCP).
			Short- to Long-term	If increasingly severe natural disasters damage our facilities or those of our suppliers, our operations could be disrupted or halted, resulting in a loss of revenue.	Medium	Develop a system for confirming the safety of our employees and business partners during a disaster, alongside a comprehensive Business Continuity Plan (BCP). Strengthen our disaster preparedness equipment and conduct regular emergency drills. Install uninterruptible power supply (UPS) systems.
			Short- to Long-term	In the wake of severe natural disasters, corporate customers may prioritize restoring their damaged facilities, leading them to cut back on IT spending.	Low	Diversify our business operations geographically (nationwide expansion).
		Chronic	Short- to Long-term	Rising average temperatures will drive up the cost of air conditioning needed to cool equipment at our facilities and data centers.	Low	Work with building management and electricity providers to identify and evaluate efficiency plans and new equipment options.
Opportunity		Products and Services	Medium- to Long-term	IT spending is on the rise, driven by two key trends: a push toward paperless operations due to forest conservation policies, and the wider adoption of remote work in response to extreme weather.	Medium	Expand our business areas and service offerings. Recruit and train the engineers needed to support our business domain expansion.
		Market	Short- to Long-term	Growing customer demand for decarbonization and resource-saving solutions presents an opportunity to develop new services and applications, creating new revenue streams.	Low	Strengthen our methods for understanding customer needs and tracking market trends.
		Market	Short- to Long-term	As natural disasters become more severe, demand for cloud and data center services is rising as part of business continuity efforts. This, in turn, is driving sales for our related support services.	High	Expand the scope of our services and support offerings. Recruit and train the engineers needed to support our business domain expansion.
		Resilience	Short- to Medium-term	Taking proactive measures on climate change can enhance our reputation with customers and investors, potentially leading to more business and a higher stock price.	Low	Develop internal systems to calculate and manage emissions, drive reduction efforts, and handle all related disclosures. Advance GHG reduction initiatives. Ensure ongoing disclosure to stakeholders and continuously improve our reporting.

Time Horizons: We classify the time horizons over which climate change risks and opportunities are expected to materialize as "short-term," "medium-term," and "long-term," defined as follows:
Short-term: By 2028; Medium-term: By 2030; Long-term: By 2050
Impact Levels: We classify the level of impact from climate change risks and opportunities as "High," "Medium," or "Low" based on the following definitions:
High: Potential for a major impact on management due to significant fluctuations in business performance. Alternatively, a risk that a majority of employees could be unable to work and facilities rendered inoperable.
Medium: Potential for business operations to be impacted by fluctuations in business performance. Alternatively, a risk that around 30% of employees could be unable to work and facilities rendered inoperable.
Low: A minor impact on business performance with no significant effect on business operations. Alternatively, a risk that a portion of employees could be unable to work and facilities rendered inoperable.

Risk Management

The System Support Group has a Sustainability Committee that discusses risks and opportunities related to sustainability, including climate change. Specifically, we identify and assess sustainability-related risks and opportunities by examining the impacts of the value chain both in the group as a whole and including suppliers and customers involved in Group businesses, as well as examining the value demanded by various stakeholders, such as investors and society.
Sustainability-related risks identified and assessed by the Sustainability Committee are also reported to the Risk Management Committee for company-wide risk management.

Metrics and Targets

To assess and manage the impact of climate change on our business, our Group began calculating our greenhouse gas emissions (Scope 1 and Scope 2) in accordance with the GHG Protocol, starting in the fiscal year ended June 2023. We have now also set a greenhouse gas emissions reduction target, as of July 2025. Moving forward, we will work to achieve this target by promoting various reduction initiatives, such as introducing renewable energy and thoroughly implementing energy conservation measures.

Greenhouse Gas Emissions Performance [Unit: t-CO2]

	FY2023	FY2024
Scope 1 Emissions	25	27
Scope 2 Emissions	311	314
Scope 3 Emissions	-	11,005

Greenhouse Gas Emissions Reduction Targets

	FY2030	FY2050
Scope 1 + 2 Emissions	42% reduction (compared to FY2023)	100% reduction

Scope 1: Direct emissions from the consumption of city gas in our Group's offices and gasoline used in company vehicles.
Scope 2: Indirect emissions associated with the use of electricity and heat (for purposes such as air conditioning) at our Group's offices and facilities.
Scope 3: Indirect emissions related to our Group's business other than Scope 1 and Scope 2 (i.e., emissions from other companies).
We began calculating Scope 3 emissions starting with fiscal year 2024.
Our Group compiles its greenhouse gas emissions data for the period from April of each year to March of the following year.
At present, our Group's greenhouse gas emissions calculations have not undergone third-party verification.
Regarding our greenhouse gas emissions reduction target for fiscal year 2050, we plan to utilize carbon credits to address any residual emissions remaining after all other reduction initiatives have been implemented.