Our Corporate Governance System

1. Fiscal 2006

   Initiated internal control project

   Aim

   Strengthen internal control from Groupwide perspective

2. Fiscal 2008

   Appointed external director

   Aim

   Strengthen monitoring and oversight of business management and reflect wealth of insight in business management

3. Fiscal 2009

   Increased external directors to two

   Aim

   Strengthen monitoring and oversight of business management and reflect wealth of insight in business management

4. Fiscal 2010

   Established Group Compliance Liaison Committee

   Aim

   Establish J-SOX compliant internal control system

5. Fiscal 2016

   Established Independent Advisory Committee, assessed effectiveness of the Board of Directors, and disclosed medium-term management strategy and targeted management indicators

   Aim

   Receive opinions on significant management issues, promote accountability to capital markets, exchange information to ensure oversight of the Board of Directors, bolster functions of directors, and strengthen Group management

6. Fiscal 2017

   Established position of CFO
   Increased external directors to three
   Disclosed action plan for achieving medium-term performance targets

   Aim

   Provide financial support for growth strategies and strengthen communication with capital markets

7. Strengthen continuously

Percentage of External Directors

Internal directors

63%

External directors

37%

Careers of External Directors

Internal Directors’ Periods of Servic
(As of August 2017)

• At least 10 years 2
• At least 5 years 1
• At least 2 years 1
• Less than 1 year 1

Compensation of Directors (SEGA SAMMY HOLDINGS non-consolidated)

Millions of yen

Overview of the Governance Structure

The SEGA SAMMY Group has adopted an Audit and Supervisory Board member system to enable directors to make prompt, optimal decisions amid volatile business conditions based on their wealth of expertise and experience regarding the industry, market trends, products, merchandise, and services. At the same time, we have appointed external directors and strengthened our executive officer system and internal auditing system, thereby reinforcing corporate governance with respect to operational management and oversight.

Comprising eight directors, the Board of Directors strives for agile business management. It convenes once a month in principle, holding extraordinary sessions as required.

Comprising four members, the Audit and Supervisory Board thoroughly examines and analyzes specific issues. It meets once a month and holds extraordinary sessions as required.

The SEGA SAMMY Group has established voluntary committees?the Group Management Strategy Committee and the Independent Advisory Committee?as well as the Group Compliance Liaison Committee, the Group Audit Liaison Committee, the Holdings Audit Liaison Committee, and the Audit and Supervisory Board Members and Internal Auditing Office Liaison Committee. These committees were established to facilitate intra-Group information sharing, discussion, verification, and coordination, and they are also tasked with issuing reports and making proposals to the Board of Directors. Furthermore, the Company has adopted an executive officer system with the aim of expediting management decision making and enhancing operational implementation and related oversight functions.

Corporate Governance System (As of June 30, 2017)