Materiality

Background

Three years have passed since we launched the Materiality. Significant changes have since emerged in social problems our businesses face in tandem with the rapid developments in society and the transformation of our businesses. Considering the environment surrounding us, we have decided to review the Materiality as we formulate a Transformation Business Plan, an improved version of the medium-term management plan announced in 2020. Moreover, we have set specific targets for the Materiality issues, based on "backcasting", further integrating sustainability and business promotion.

Identification and Review of Materiality Issues

We have decided on three key focus areas. Based on internal discussions and suggestions from outside experts, we had discussions at management level, reviewed the Materiality and set targets. We will proactively inform our stakeholders of our progress in setting Materiality targets and engage with them in a responsible manner.

1. STEP 1

   Redefine the corporate group’s vision.

   Examine the direction of the Transformation Business Plan considering social changes that will affect the sustainable development of both society and the Company, and through our Corporate Philosophy “Benesse = Well-Being”, our group purpose to realize it, and "backcasting" from society in 2028 and beyond. As the first step in achieving the plan, we have focused on being a corporate group overwhelmingly committed to solving social problems by putting people first.

2. STEP 2

   Clarify points of emphasis.

   Determine the key points in the Materiality to achieve the group purpose and the goals of the Business Transformation Plan.

   • Corporate Philosophy “Benesse = Well-Being” and Group Purpose.
   • Social issues faced by people at each stage of life, which we identified by "backcasting" from the future society of 2028 and beyond.
   • Implementing conscientious management that reflects expectations that companies should contribute to the sustainability of society.

3. STEP 3

   Hypothesize materiality.

   Hypothesize the Materiality by closely examining the importance of the social problems identified in step 2 for each life stage and considering society’s expectations of the Company.

4. STEP 4

   Discuss at management level.

   Discuss at the Executive Committee, chaired by the CEO and comprising executive officers, and at the Sustainability Promotion Committee, chaired by the Managing Executive Officer and comprising the CEO, internal directors and executive officers.

5. STEP 5

   Dialogue with stakeholders.

   Have dialogues with experts, NPOs and others based on the hypothesis, confirming expectations and requests to the Group from other outside parties and reflect them in the review process.

6. STEP 6

   Consider targets.

   Set up goals in line with the Transformation Business Plan based on the Materiality.

7. STEP 7

   Approval by the Board of Directors.

   Discuss and approve at the board meeting following discussion at the Management Committee and other meetings.

Issues centered on people

• Changes in parenting environment
• Disparities in educational opportunities
• Decreased motivation to study
• Diversification of learning objectives and postgraduation pathways
• Changes in the way teachers work

Group capital

• Technology
• Social capital (customer base, schools/municipalities, community network)
• Intellectual capital

Commitment

Provide education services that accommodate diversity and disparity of educational opportunity and help more children to thrive as they grow.

Business fields

• Kids & Family Business
• Out-of-School Learning Business
• School and Teacher Support Business

Concrete approaches

• Expand product lineup to meet diverse needs by harnessing our educational expertise and DX on the back of our unrivalled customer base.
• Support the diversifying choices of postgraduation pathways and changes in the way teachers work based on existing platforms used by a large number of schools.
• Provide educational opportunities that are readily accessible by all children.

Initiative examples & Visions

• Establishment of a scheme/model for new value creation that links student assessment data, daily learning data, and the school administration system.
• Provision of accessible learning opportunities through next generation Shinkenzemi in view of the FY2025 Next GIGA Program.

Examples of activities

• We want to contribute to the future of local areas; the experience of 'learning the joy of learning' through the power of AI [Japanese]
• Towards a society where teachers live happily and children live happily. 'Teachers' Day Gathering 2023' [Japanese]
• A place for the future, close to children who have difficulty attending school. UP Inc. opens a correspondence high school support school [Japanese]

Corresponding SDGs goals

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Issues centered on people

• Changes in required qualities and abilities
• Autonomous career development by individuals

Group capital

• Human capital (strengthen human resources and increase number of personnel)
• Investment
• Technology
• Social capital (customer base, governmental/corporate networks)
• Intellectual capital

Commitment

By helping individuals take ownership of their career/life, companies can drive their own sustainable corporate growth.

Business fields

• University and Working Adult Business
• New business development, M&A

Concrete approaches

• Lead the reskilling market by leveraging our rapidly expanding Udemy network of individual, corporate, and municipal users.
• Expand our human resource matching business (recruitment, transfers, job searches, job changes) by providing reskilling and skill development services to individuals.

Initiative examples & Visions

• A capital alliance with SkyHive, a world-leading labor market database provider
• Inclusion of Waris (provider of recruitment support services for Japanese women) into the Group

Examples of activities

• Japan's first "National Local Government Reskilling Network" launched, with participation from 76 local governments nationwide
• Joint development with Benesse of 'Work Resume AI Analysis for Women (beta version)', which uses generative AI to analyse work resumes and suggest future careers in five minutes [Japanese]
• Women's career support service Mentoring dialogue service 'withbatons' launched in June. More than 80% of women improved their motivation and willingness to be promoted to managerial positions during the trial phase. [Japanese]

Corresponding SDGs goals

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Issues centered on people

• Increase in number of elderly people requiring nursing care
• Shortage of nursing care workers
• Delays in nursing care DX

Group capital

• Human capital (professional human resources)
• Technology
• Intellectual capital (know-how)
• Social capital (multifaceted connections with nursing care personnel)

Commitment

Develop more nursing care workers who can serve as role models while also enhancing the QOL of the elderly, thereby making nursing care a more attractive job choice.

Business fields

• Nursing Care and Childcare Business
• Nursing Care Peripheral Businesses

Concrete approaches

• Develop nursing care workers with highly specialized skills based on a systematic in-house training system, and widely share their expertise with society at large.
• Visualize tacit knowledge of experts through the use of technology.
• Ease nursing staff shortages through business efforts.

Initiative examples & Visions

• Introduction of an internal qualification and related training system to foster nursing care experts, dubbed Majikami, who will help enhance the QOL of the elderly (Over 600 Majikami to be certified by FY2025)
• Provision of support to acquire certified care worker qualification
• Expansion of Benesse sensing homes that employ AI technology (All care homes by FY2024)

Examples of activities

• Human capital development based on professional development [Japanese]
• Giving knowledge back to society - publishing know-how for all those involved in care [Japanese]
• Bringing the power of AI to the field of care. 'Majikami AI' reduces the workload of care staff and improves the quality of life of residents [Japanese]

Corresponding SDGs goals

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Benesse’s policy

Encourage individuals to achieve autonomous growth based on a learning culture and provide relevant opportunities.

Commitment

Develop diverse talent to lead the drive to resolve social issues through business.

Concrete approaches/targets

• Visualize the key positions and specialized expertise required to drive transformation and digitalization, and implement training accordingly, aiming to achieve a fill rate of digital human resources of more than 85% in FY2025.
• Promote diversity in terms of experience, age, gender, etc., having at least one female director/executive officer and achieving a minimum of 30% female managers by FY2025.
• Promote career development support to enhance employee engagement. Engagement score target: A

Examples of activities

• Offering Learning Opportunities for the Promotion of Digital Transformations
• Promotion of DE&I activities
• Speedily visualise organisational issues and improve employee engagement

Corresponding SDGs goals

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Benesse’s policy

As part of our efforts to fulfill our corporate philosophy and purpose, position the environment as one of our material management issues and take proactive steps to promote related measures in line with the Group’s business characteristics.

Commitment

Preserve the global environment with the aim of providing a secure world for future children to grow up in.

Concrete approaches/targets

Set medium- and long-term GHG reduction targets and acquire SBTi certification.

• Benesse Group: Scope 1 and 2 (1.5°C targets) : < 2030 : 42.4% > < 2041 : 100% >
• Benesse Corporation: Scope 1 and 2 (1.5°C targets) : < 2030 : 52.8%* > < 2041 : 100% > < 2050 : 100%* > Scope 3 (2°C targets) : < 2030 : 14.8%* > < 2050 : 39.4%* >

* SBTi certification already acquired.

Examples of activities

• Our Response to Climate Change
• Biodiversity Restoration and Resource Conservation Response
• Environmental Education

Corresponding SDGs goals

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Benesse’s policy

Build and operate a management structure that supports the autonomous growth of operating companies and further enhances our management oversight function.

Commitment

Make Group-wide efforts in line with our corporate philosophy and purpose to promote integrity and sound management to maximize customer value through our business.

Concrete approaches/targets

• Set codes of conduct at all Group companies based on the Benesse Group purpose and Principles (within one year in the case of a new Group company).
• Execute ongoing compliance activities using a PDCA cycle at all operating companies.
• Further enhance information security by continuing to hold Security Day, providing regular security training, etc.
• Enhance human rights initiatives through human rights due diligence and awareness-raising activities.

Examples of activities

• Risk Management and Compliance
• Ensuring information security
• Respect for Human Rights

Corresponding SDGs goals

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