The Company and the Group position corporate governance as the most important foundation for facilitating good corporate behavior. The Company and the Group uphold “improving efficiency,” “securing soundness,” and “enhancing transparency” of corporate management as its basic policy for corporate governance. On this basis, the Company and the Group make determinations on important management issues, including the appointment of director candidates, determining director and auditor remuneration, and management oversight.

By establishing a prompt and appropriate decision-making process and improving the efficiency of corporate management, the Company aims to maximize its corporate value, thereby striving to provide appropriate returns to various stakeholders, including shareholders.

Amid significant changes in the business environment, to maximize the Company’s corporate value, the Company and the Group will appropriately recognize and manage the various risks surrounding the Company and the Group. The Company and the Group will strive to secure sound management by establishing a system (compliance system) to ensure compliance not just with laws and regulations, but with ethical standards and societal norms.

With the growing importance of information disclosure for companies, the Company and the Group will fulfill their accountability to all stakeholders, including shareholders, and further improve disclosure through proactive engagement in IR activities, thereby cultivating highly transparent management.

To further promote productive discussions by the Board of Directors and to strengthen its oversight functions, the Company has chosen the structure of a company with an Audit and Supervisory Committee.
This will allow it to delegate a considerable portion of important decisions on business execution to executive directors. In addition, by considering that directors with a wealth of knowledge and experience regarding the industry, market trends, products, merchandise, services, etc. can generate prompt and optimal management decisions, the Group companies have chosen the structure of a company with company auditors. The Company and the Group also appoint external directors and strengthen the executive officer and internal auditing systems, thereby improving corporate governance from the aspects of both oversight and execution.

At ordinary Board of Directors meetings held once a month in principle and extraordinary Board of Directors meetings held as appropriate, the Board of Directors aims to achieve flexible management through the current level of 13 directors. Certain important managerial matters at each business company are also resolved or reported at various bodies, including the Company’s Board of Directors.

The Audit and Supervisory Board consists of 4 Audit and Supervisory Committee members and holds its meetings generally once a month, or when otherwise necessary. The Audit and Supervisory Committee assigns duties to respective Audit and Supervisory Committee members, and deliberates on key matters for consideration such as those involving the status of establishing and operating the Group’s corporate governance and internal control systems, and evaluations of the independent auditor.

The Company shall perform analyses and evaluations of the effectiveness of the Board of Directors each year to ensure that the Board of Directors effectively fulfills its roles and responsibilities to “improve efficiency,” “secure soundness,” and “enhance transparency” of the Company’s corporate management.

For the fiscal year ended March 31, 2025, the Company evaluated the effectiveness of the Board of Directors via questionnaires sent to all directors to ascertain the expectations and issues identified by each Director in his or her efforts to enable the Board to better contribute to the Company’s sustained growth.

These questionnaires were used to confirm various matters deemed important in the Board’s roles and responsibilities, including Board composition, management, and the status of deliberations concerning strategy, as well as the effects of initiatives to address issues identified during the previous fiscal year. To ensure objectivity, the Company had an external organization design the questionnaire and analyze and evaluate the responses. Additionally, the Company confirmed performance of each external director.

Based on the report on the results of the questionnaire prepared by the external organization, deliberations took place at meetings of the Board of Directors on various topics, including the effectiveness of the Board of Directors during the fiscal year, where issues might lie, and responses to such issues.

Based on these deliberations, the Board of Directors was judged, overall, to function effectively. Its free and open deliberations, based on a Groupwide perspective, were recognized as a key strength. The independent external directors participate in constructive deliberations from medium- to long-term points of view. The composition of the Board ensures diversity.
Reviewed and evaluated below are efforts to address issues recognized last fiscal year:

(Review and evaluation of initiatives) In the current fiscal year, the Board of Directors and the Group Management Committee found that risk management structures, including the activities of the Risk Governance Division, showed steady improvements, as indicated by the establishment of monitoring opportunities. The need for continuing efforts was acknowledged, given the importance of strengthening risk management for the entire Group.

(Review and evaluation of initiatives) During this fiscal year, the Board of Directors and the Group Management Committee created opportunities for deliberations on resource allocation within the Group and on other key issues. They also established opportunities to deepen understanding of the business environment for the Gaming Business. These efforts led to steady improvements. Also recognized was the need for improved deliberations on matters such as capital profitability as a target for the entire Group, given the inherent diversity of revenue structures between individual businesses.

(Review and evaluation of initiatives) This fiscal year, the Board of Directors and the Group Management Committee sought to achieve consistency between M&A initiatives and strategic policies for the entire Group. However, the need for continuing efforts to improve deliberations on and understanding of such matters was acknowledged.
In addition, the Board of Directors and the Group Management Committee acknowledged the need to monitor the allocation of human capital for the purpose of effective implementation of strategies across the Group, given the differing characteristics and strategies of the Group’s individual businesses.

The Audit and Supervisory Committee evaluates and improves the effectiveness through the plan-do-check-act (PDCA) cycle. This is intended to make the governance system more transparent and to continually improve audit functions, among other goals.

Effectiveness was evaluated through qualitative evaluations based on materials from the Japan Audit & Supervisory Board Members Association on evaluations of Audit and Supervisory Committee effectiveness. The main items evaluated were the propriety of audit plans, the efficacy of governance, internal controls, business audits, and Group audits, attendance at important meetings, selection of key audit matters (KAMs), and coordination with the accounting auditor and internal audit sections.
The Committee is chaired by a standing Audit and Supervisory Committee member. Opinions were exchanged on the evaluation of each item, of various issues, and of the potential for further improvements. The findings were reviewed by the Audit and Supervisory Committee, which also deliberated on matters like efficacy, issues, and measures to address the issues in question.

The Audit and Supervisory Committee was judged to demonstrate satisfactory effectiveness. New business handling, information sharing, and response to risks were identified as issues to be tackled for further enhancement. The report to the Board of Directors noted the intention to cooperate with the Board and other parties to achieve further improvements.

The Company has formulated a skills matrix based on the experience and knowledge required for management of a listed company and the experience and knowledge required to achieve the Company’s long-term vision. The basic policy calls for selecting and determining director candidates based on comprehensive assessment of both character and fit with the skills matrix. The Independent Advisory Committee examines a proposal for such candidates submitted by the President (Representative Director), conducts interviews and the like with such candidates, and submits the evaluation results as its opinion to the President (Representative Director). Based on these evaluation results, the President (Representative Director) judges the director candidates in accordance with the above-mentioned policy. The Board of Directors then discusses and approves such judgment. The same applies when the Independent Advisory Committee recommends director candidates to the President (Representative Director).

If a director is deemed unable to perform his or her duties due to mental or physical incapacity or if a material fact such as misconduct or violation of laws, regulations, or the Articles of Incorporation is recognized in the performance of his or her duties, the Independent Advisory Committee shall deliberate to determine the appropriate action in a timely manner. Base on the results of such deliberation compiled in a report to the Board of Directors, the appropriate action with regard to the director shall be determined by the Board of Directors.

The Company’s compensation system for directors and Audit & Supervisory Board members is designed to ensure transparency and provide greater incentive to increase corporate value. The compensation system for directors (excluding directors who are Audit and Supervisory Committee members and external directors) is determined based on the following basic policy.

Based on the basic policy, the remuneration system for Directors of the Company (excluding Audit and Supervisory Committee Members and External Directors) includes fixed remuneration, Directors’ bonuses, and restricted stock units.
SEGA CORPORATION and Sammy Corporation have adopted similar remuneration structures. All remuneration for a Director serving concurrently as Representative Director, President, and CEO of both companies is paid in compliance with the respective officer remuneration systems of both companies.

A compensation table shall be formulated specifying the compensation amounts for each component, namely, basic compensation and role-based compensation, and the Company shall provide the sum of these components as monthly fixed compensation.

Directors’ bonuses are paid as performance-linked remuneration in the amount determined by multiplying the above fixed remuneration by coefficients calculated based on a bonus table that defines the number of months of Directors’ bonuses based on three elements: the level of the adjusted EBITDA; level of business plans achieved; and the year-on-year growth.

The Ordinary General Meeting of Shareholders held June 25, 2024 resolved to adopt a system of remuneration through restricted stock units for Directors (excluding Audit and Supervisory Committee Members and External Directors; “eligible Directors” hereinafter) to further align the long-term interests of Directors with long-term shareholder interests and to provide incentives for increasing corporate value over the medium to long term. This program will supplant the system of share-based remuneration with restrictions on transfer for eligible Directors; eligible Directors will be issued shares of Company common stock allotted over a certain period of time. Upon comprehensive consideration of the contributions and various other factors of the Eligible Directors, a limit for the total amount of compensation and the number of shares would be set for each Performance Share Units (PSU) and Restricted Share Units (RSU) in relation to the Plan for Eligible Directors. In addition, the Board of Directors will determine the ratio of fixed compensation, single-year performance-linked bonuses and restricted stock units for the three fiscal years if the targets of the Medium-term Management Plan are achieved, to be approximately 1:1:1.

Compensation for directors and Audit & Supervisory Board members for the fiscal year ended March 2024 is as follows.

Directors who received ¥100 million or more in total compensation for the fiscal year ended March 2024 is as follows.

To improve corporate governance in the Company and the Group as a whole, the Company has established a Group Risk and Compliance Promotion Committee, and deliberates and confirms any problems occurring in constructing internal control for the management of the Group and the progress thereof, and thus strive to maintain and improve the level of corporate governance.
In addition, the Group established a scheme for evaluating and reporting of the internal control system as required under the Internal Control Report System Relating to Financial Reporting (the Japanese Version of the “SOX Act”), as stipulated in the Financial Instruments and Exchange Act. The Group also addressed inadequacies discovered in the course of these evaluations.
The Company will continue to strive to assure continuing trust/reliability in our financial reporting and to maintain and develop our internal control system, taking into consideration issues such as improving efficiency and securing soundness.

The Group has established the mission and purpose articulated in the following slogan: Constantly Creating, Forever Captivating -Making Life More Colorful- with the vision to Be a Game Changer. The Group sees, as its reason for being, continuing to deliver fresh excitement by making life more colorful for people around the world and by inspiring sympathy, in an age of dramatic volatility, through its products and services.
Since consolidating the head office functions of the Group companies at Osaki in 2018, the Group has been a pioneering figure in moving forward with an agenda known today as human capital management. The goal has been to build human resources, a culture, and an environment that will help realize its vision. The current Mid-Term Plan (for the year ending March 2025 through the year ending March 2027) sets forth its Human Capital Development Goals as a group human resource strategy that identifies shared topics and goals to be addressed by each Group company. Progress on the important elements of these goals is monitored regularly based on proprietary and quantifiable 4 targets; ① Multicultural talent: No. (ratio) of persons, ② Female managers: No. (ratio) of persons, ③ Amount invested in education and ④ Workplace environment improvement (engagement score).
The Group strives to achieve sustainable growth by creating an environment and culture conducive to continual innovation through bringing together diverse human resources as creators of moving experiences who can demonstrate unique individual strengths in solidarity with their colleagues.