LY : Value Creation Process and Materiality (integrated report FY2023 en 05)

Integrated Report Portal FY2023

* Total number of registered users of LY Corporation's main consolidated services, including Yahoo! JAPAN annual login IDs, LINE monthly users, and PayPay registered users.

Realizing the Group's Mission by Creating Solutions That

Balance Profit Generation with Solving Social Issues

We strive to monitor conditions in our business environment accurately, analyze the risks and opportunities that these present, and then identify the key issues that we need to address to realize sustainable growth. These key issues are considered as we leverage the Group's strengths-including our diverse business portfolio and one of the largest user bases in Japan-to create new data solutions that not only generate further profits, but also contribute to solving social issues. We think that this will enable us to realize the Group's mission: "Create an amazing life platform that brings WOW! to our users."

The LY Corporation Group established "Six materialities" in order to realize its mission: "Create an amazing life platform that brings WOW! to our users."

By addressing these issues, the Group will build a future with its stakeholders in which everyone can use the power of the Internet with peace of mind.

Businesa foundation

Identified materiality

Providing new (WOW9 experiences u9ing data/AI

Operating safe & secure digital

Building a resilient social infrastructure

Fulfilling responsibilities for the global environment and

future generations

Reinforcing group governance

Description

The LY Corporation Group's mission is to solve problems of people and the society usir›g information technology, under its principle of "users first." The LY Corporation Group aspires to grow as an Al tech company leading the world from 3apon ancl ASio, and to continue providing convenient and inspiring user experiences through the use of data/AI.

Ensuring safety and security in the use of informatic›n is the first and foremost responsibility thot must be fulfilled by pkrtform operators. Based on this understanding, the LY Corporation Group provides safe and secure IT services from a medium to long term perspective, by ensunng convenient services that anyone can access any time, while providing and reinforcing confidentiality of communicatic›ns and informoticri security.

The LY Corporation Group strives to build a digitally driven and resilient social infrostructuna by Ooritributing to disaster prevention and mitigation, response to the pondemic, municipal DX, medical DX, online education and the realization of a

resouroe-circulating society through reuse. The LY Corporation Group will continue businesses and support activities to ensure thot the benefits of digital technology are available to all, with a determination of leaving no one behind.

Developing or›cI stren@hening talent that drives product-driven innovation is the source of LY Corporation's competitiveness. Aiming to maximize the performance of human capital and organizations, the Company is committed to supporting employee growth, creating a conducive work environment, and fostering a culture through its values.

Reducing environmental impact and considering the ecosystem are important responsibilities that the LY Corporation Group must fulfill for Mure generations. Together with its supply chain, the Group aims to realize a decorbonized society through initiatives such as promoting the use of renewable energy for dectricity. Furthermore, as the Group views addressing climate change and natural oopital as business opportunities to strengthen oollaborations with a wide range of societal stakeholders, it will continue to take on these challenges by leveraging the power of IT

Group governance is one of the most important management issues for LY Corporation Group, which has e 'oIved into one of the largest IT service providers in 3apon, offering services to the world. The LY Corporation Group will reinforce vertical governance providing optimal decision making for the Group, and horizontal governance promoting the generation of synergies between Group oornpanies, to build and reinforce a governance structure thot is among the highest standards in the world.

Relation to evaluation mop

• Promote and diffuse digital financial services/fintech

• Improve 8ervices through the u8e of

  doto

• Secure sofa telecommunkxztions and

  protect privacy

• Contribute to the healthy and safe

  development of the Internet soc«rI

• Measures against illegal and harmful

  information

• Ensure security as a sociaI infrastructure

• 8ecure/improve c›ccessibility

• Fair competitive environment

• Ensure freedom of expression

• Support the promotion of disaster prevention, mitigation, and pondemic response

• Support a digitally driven society,

  through municipal DX, medical DX, etc.

• Contribute to community development

• Support the development/improvement of the educational environment

• Contribute to a recycling-oriented society through reuse business, etc.

  ' Retain/reinforce human capital

  ' Diversity and inclusion

  ' Heohh and productivity management

  ' Respect for human rights

• Mitigate and adapt to climate change

• Promote supply chain management

  (Scope 3 management, etc.)

• Conservation of water resources

• Preserve bMiversity

• Respect for human rights

• Promote supply chain management

• Rigorous risk management

• Compliance and anti-corruption

  rr›easures

• Upgrade and ensure the effectiveness of corporate governance

• Secure financial base

Key issues (materiality) that we need to address to realize sustainable growth

Sustainability Initiatives and Management Structure

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Message from the Corporate Officer in Charge of Sustainability