Governance Promotion System

Summary of Corporate Governance Structure

Type of Organization	Company with corporate auditors
No. of Directors	Ten including four independent outside directors
No. of the Audit & Supervisory Board Members	Four including two independent outside Audit & Supervisory Board Member
Term of office for the Directors	One year
Accounting Auditor	Ernst & Young ShinNihon LLC

Notification of independent directors/corporate auditors (Japanese only).

Outline of Corporate Governance

We consider developing and strengthening corporate governance to be a key management issue. By strengthening corporate governance, we are aiming to realize our mission, achieve the management plans, enhance the corporate value over the medium- to long-term, and achieve sustainable growth. In addition, to realize higher corporate value for all stakeholders, we consider aiming for efficient, fair, and highly transparent management to be the basic approach underpinning our corporate activities.

Based on this approach, the Board of Directors is working to develop management structures, organizations, and systems that will allow us to engage in appropriate and speedy decision making, strengthen the supervisory functions governing the decisions made, establish compliance systems, improve and reinforce internal control systems, and build healthy relationships with stakeholders.

In addition, the director in charge of the Corporate Management Headquarters oversees the management of the Company and its subsidiaries and affiliates in order to ensure thorough governance throughout the entire Group. In order to facilitate the smooth exchange of information and promote group activities, liaison meetings of subsidiaries and affiliates are held on a regular basis.

The director in charge of each subsidiary and affiliated company is responsible for establishing sustainability promotion system, compliance system, and risk management system in accordance with measures based on management plans and efficient business execution.

Corporate Governance Report

Corporate Governance SystemAs of June 26, 2025

Business Management System

The Company has the Board of Directors to decide important matters concerning business operations, such as the decision of management plans, and resolution set by the law, regulations, and the articles of incorporation. It also monitors the management activities as well. This improves corporate value by responding dynamically to changes in the business and management environment.
The Company has in place the Corporate Management Council to discuss important matters concerning business operation for the purpose of rapid decision-making management and smooth business operation before the Board of Directors meetings. In addition, the Board of Executive Officers is established to share information about company management in order to achieve smooth business operation and strengthened cooperation.

Furthermore, the Board of Directors set up various committees to discuss the major management challenges of the Company. Specifically, the Board of Directors established the Nomination and Compensation Committee to confer about selection and remuneration of directors, the Risk Management Committee to manage risks in the business operation, the Compliance Committee to maintain the compliance structure and manage the issues, the Personnel Committee to confer about personnel utilization, the IT Committee to maintain IT environment, and the Sustainability Committee to promote sustainability initiatives.

In the business operation structure, the Company holds four headquarters organizations: the Leasing Business Sales Headquarters, which oversees the Property Management Division and the Corporate Sales Division and is responsible for formulating and executing strategies to improve profitability; the Leasing Business Promotion Headquarters, which oversees the Leasing Business Promotion Division and is responsible for resolving issues in business promotion and planning new products and ancillary businesses; the Development Business Headquarters, which plans, designs and constructs rental housing and thereby provides living environments that meet the needs of tenants and apartment owners; the Corporate Management Headquarters which formulates and monitors the management strategies, strengthens the ties between the business divisions, and ensures compliance with laws and regulations.
We also see the enhancement of audit functions as our critical management task, and will try to reinforce the management monitoring function by setting the Audit & Supervisory Board as a supervising body for directors' business operations, by electing outside directors, and by setting the Auditing Department which is responsible for internal audit functions.
With this structure in place to clarify responsibilities and authorities, we aim to continuously enhance our corporate governance.

Board of Directors

The Board of Directors operates with an emphasis on both ensuring the speed of management and enhancing the supervisory function. We think appropriate nomination of directors is important to improve the corporate value. Therefore, we incorporate in the decision process the deliberation at Nomination and Compensation Committee with membership including outside directors.
The Board of Directors holds regular meetings once a month, while extraordinary meetings can be called at any time as required, so that it can determine critical management matters, monitor business operation, and oversee directors' performance of duties.

Outside Directors

We elected outside directors to reinforce the supervising function and to receive objective advice for decision-making. The outside directors give various advices to improve corporate value by participating in essential meetings such as the Board of Directors meetings. We think decision based on an objective advice is important especially for nominating officer candidates and determining the remuneration of the officers. The Nomination and Compensation Committee is therefore composed of President and CEO, and outside directors.
In addition, the election of the outside directors is based on an independency standard we formulated. Please refer to the relevant part in our Corporate Governance Report.

Audit & Supervisory Board

The Audit & Supervisory Board, composed of four members including two outside members, emphasizes on monitoring the directors' performance of duties.
The Audit & Supervisory Board Members try to enhance the effectiveness of audits by attending important meetings such as the Board of Directors' meetings, conducting operational status investigations and regularly collaborating with the Auditing Department, accounting auditor and outside directors.

Reasons for election as a Director and Audit & Supervisory Board Member

Name Title / position	Reasons for election as a Director and Audit & Supervisory Board Member
Bunya Miyao Representative Director, President and CEO	Mr. Bunya Miyao has a background in overseeing all of the Company's group businesses, and has extensive experience in leading the management, as well as strong leadership and decisiveness. As Representative Director, he has appropriately made important decisions and supervised business execution, and worked on stabilizing earnings structure and financial base, promoting structural reforms and DX, and resolving construction defects problem. Furthermore, last fiscal year, the Company achieved its highest profit since the financial crisis of 2008 by maintaining an increase in the average unit rent for new contracts in the leasing business. We expect that he will continue to lead the Company's growth and development, and so the Company has elected him again as a Director.
Mayumi Hayashima Director, Managing Executive Officer	Ms. Mayumi Hayashima has leveraged her diverse experience in the leasing business division, as well as extensive knowledge and a track record in overseeing the legal compliance department and implementing cross-departmental measures, to fulfill an important role as Director in taking important management decisions and supervising business execution and contribute to improving profitability. It is judged that her profound knowledge and experience are essential to the Company's management, and so the Company has elected her again as a Director.
Naomichi Mochida Director, Managing Executive Officer	Mr. Naomichi Mochida has abundant experience in corporate sales, as well as insight he has gained as Representative Director of an affiliated subsidiary that provides corporate housing agency services. Last fiscal year, as Chief of the Leasing Business Sales Headquarters, he supervised all aspects of the leasing business sales and led the improvement of leasing business performance. As a Director, his knowledge and experience are essential to the Company's ability to provide high value-added services, and so the Company has elected him again as a Director.
Shinji Takekura Director, Executive Officer	Mr. Shinji Takekura has extensive business experience and a track record in the contracted construction business, as well as a wide range of knowledge from his experience overseeing the Corporate Management Headquarters and Compliance Promotion Headquarters. As a Director, he has appropriately made important management decisions and supervised business execution, contributing to the recovery of profitability, strengthening of the financial base, and the establishment of medium- to long-term growth strategies. In addition, as the chairman of the Sustainability Committee and IT Committee, he has led the promotion of ESG strategies and DX. It is judged that his abundant experience and knowledge are essential to the Company's growth strategy, and so the Company has elected him again as a Director.
Akio Yamashita Director	Mr. Akio Yamashita has extensive business experience and a wide range of knowledge as an officer and employee of financial institutions. As a representative of an investment fund, he has a track record in a wide variety of projects, including real estate-related business, real estate finance, urban redevelopment funds, management buyouts, and corporate rehabilitation projects. At the Board of Directors meetings, he has proactively expressed his opinions from a fair perspective and appropriately supervised business execution of the Company. It is judged that his abundant experience and knowledge are essential for the Company's growth strategy, and so the Company has elected him again as a Director.
Jin Ryu Director	Mr. Jin Ryu has extensive business experience and a wide range of knowledge as an officer and employee of an investment fund, and he has a great track record of investing in and rehabilitating real estate-related businesses and companies. At the Board of Directors meetings, he has proactively expressed his opinions from a fair perspective and appropriately supervised business execution of the Company. It is judged that his abundant experience and knowledge can be leveraged for the Company's growth strategy, and so the Company has elected him again as a Director.
Akira Watanabe Outside Director	Mr. Akira Watanabe possesses expertise as an attorney at law and, through his experience as an outside director at other companies, he has developed deep knowledge of corporate management. As lead Outside Director of the Company, he has appropriately supervised business execution of the Company from an independent and fair perspective. Moreover, as the chairman of the Compliance Committee, he has contributed to strengthening and enhancing the Company's compliance system. His high level of expertise in legal affairs and compliance is essential to strengthening the functions of the Company's Board of Directors and improving corporate governance, and so the Company has elected him again as an Outside Director.
Yutaka Nakamura Outside Director	Mr. Yutaka Nakamura has been involved in quality management and environmental management in the housing industry for many years, and held key positions in several organizations. Based on his abundant track record and deep knowledge, as an Outside Director of the Company, he has appropriately supervised business execution from an independent and fair perspective. Moreover, as the chairman of the Nomination and Compensation Committee, he has increased the transparency and objectivity of officer nomination and remuneration decision procedures. His expertise and experience in construction technologies are essential to supervising and providing advice on the Company's business execution, and so the Company has elected him again as an Outside Director.
Takumi Shibata Outside Director	Mr. Takumi Shibata has accumulated broad insight as a corporate manager and deep knowledge in asset management and finance through his career, which includes important positions at securities and asset management companies. As an Outside Director of the Company, he has appropriately supervised the business execution from an independent and fair perspective. His high level of expertise is essential to realizing the structural reforms that the Company aims for and to strengthening the functions of the Board of Directors, and so the Company has elected him again as an Outside Director.
Kan Ishii Outside Director	Mr. Kan Ishii possesses broad knowledge and experience concerning corporate rehabilitation accumulated through his career, which includes important positions at an investment bank and serving as Trustee Representative of Japan Airlines. He also fulfills an appropriate role as Outside Director in supervising the business execution of the Company from an independent and fair perspective. It is judged that his high level of expertise is essential to realizing the structural reforms that the Company aims for and strengthening the functions of the Board of Directors, and so the Company has elected him again as an Outside Director.
Jiro Yoshino Outside Audit & Supervisory Board Member	Mr. Jiro Yoshino has held key positions at Aioi Nissay Dowa Insurance Co., Ltd. and possesses deep insight and abundant experience accumulated as a business manager of a listed company. Moreover, he has served as a full-time Audit & Supervisory Board Member at MS&AD Insurance Group Holdings, Inc., and has abundant knowledge and experience as an Audit & Supervisory Board Member. It is judged that he will be best to appropriately audit the execution of duties by the Company's Directors, and the Company has elected him again as an Outside Audit &Supervisory Board Member.
Kenichiro Samejima Full-time Audit & Supervisory Board Member	Mr. Kenichiro Samejima has experienced overseeing the leasing business division of the Company and, as Executive Officer, overseeing the information systems department, and through those experiences, he possesses abundant knowledge about the Company's core business and a deep understanding in the Company's operations. Since assuming office as Audit & Supervisory Board Member in July 2020, he has appropriately supervised the duties of Directors, and it is judged that he will contribute to the growth and value improvement of the Group. Therefore, the Company has elected him again as an Audit & Supervisory Board Member.
Yoshitaka Murakami Audit & Supervisory Board Member	Mr. Yoshitaka Murakami possesses expertise and abundant experience in finance, accounting, and taxation gained through his experience serving as First Deputy Commissioner of National Tax Agency and as Full-time Audit & Supervisory Board Member of Credit Saison Co., Ltd. for eight years. Since assuming office as Audit & Supervisory Board Member in July 2020, he has been conducting appropriate supervision of business execution from an independent and fair perspective. The Company expects that he will continue to contribute to monitoring and supervising the Company's management and therefore, the Company has elected him as an Audit & Supervisory Board Member.
Kazutaka Shimohigoshi Outside Audit & Supervisory Board Member	Mr. Kazutaka Shimohigoshi has a high level of insight in accounting and taxation, which is required of an Outside Audit & Supervisory Board Member who is responsible for accounting audits. JP Consultants Group, of which he is Representative Director, is well versed in the field of asset succession and has been providing tax advice to the Company's property owners since around 2016, and is familiar with the Company's business model. Therefore, the Company has elected him again as an Outside Audit & Supervisory Board Member.

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Introduction of Management