Material Issues

Sustainability strategy

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Six material issues

The material issues are divided into those related to resolving social issues through business activities, namely “building society and industry through digital transformation (DX),” “connecting people and information to create new excitement” and “creating new businesses through open innovation,” as well as those related to solving social issues through corporate activities, namely “contributing to the global environment with the power of technology,” “building high-quality social communication networks” and “developing a resilient management foundation.”

We also view materiality not only as an opportunity to mitigate risks in our corporate and operational activities, but also to accelerate our sustainable growth.

Combining a visionary perspective for the future with SoftBank's unique point of view, the six material issues originate from contemporary society and our business, as well as from our focus on the future social environment and its challenges.

Identifying
material issues

Issues are identified from the external (stakeholder) level of importance, including international guidelines such as the GRI Standards and SDGs, discussions at international conferences, investor opinions, and the views of experts representing external stakeholders, as well as our own level of importance based on discussions within each general manager, division, and subsidiary-related company, and are evaluated and set based on both perspectives.

In addition, we review material issues in each fiscal year in light of changing expectations from external stakeholders and societal trends toward ensuring the effectiveness of ESG promotion.
In implementing the material issues identification and verification process, the ESG Promotion Committee discusses the results of several discussions based on materiality assessments made by the ESG promotion managers of each division and group company based on their short-, medium-, and long-term plans, and the results of materiality assessments are approved by the Board of Directors.

In the process of materiality and its identification and verification, in addition to the impact of our business on changes in society and the external environment^*1, the outlook, status and importance^*2 of our business, based on the principle of double materiality, our positive and negative impacts on society and the environment are also reflected in our materiality and the value we create.

The entire company, including directors, senior management, and employees, reaffirms that these initiatives will further accelerate our management strategy and are important key drivers for becoming a comprehensive digital platform provider, and we will continue to promote both the realization of a sustainable society and the sustainable growth of our company.

[Notes]

*1
The increased importance of climate strategy, biodiversity and natural capital; the impacts of geopolitical issues and international tensions; and the increased importance of information security and the protection of data and personal information, including cyberattacks and tightening data transfer regulations
*2
The further promotion of the practical implementation of digital technologies and corporate and social DX; the creation of new lifestyle value and pursuit of customer value; global-scale business expansion; energy sector initiatives; and the increased importance of coordination with group companies and strengthening of synergy
*
Obtained third-party assurance for materiality identification process (Japan Quality Assurance Organization)

Materiality assessment process Verification Report (PDF: 120KB/1 page)

External Importance

Based on the requests for various issues from international guidelines (GRI, SASB, SDGs, etc.), international reports (WBCSD VISION2050, etc.), stakeholders such as experts (university professors, industry celebrities, etc.) and investors, and external initiatives such as ESG ratings, we identify our materiality considering both the impact of society and the environment on the Company and the Group, as well as the impact of the Company and the Group on society and the environment.

Internal Importance

Based on our and our group's short- and medium-term plans and their importance in the long-term future, as well as international reports such as WBCD VISION2050 (Macro Trends and Disruptions Shaping 2020~2030) and future forecast reports issued by the Japanese Cabinet Office, importance is determined considering both the impact of society and the environment on the Company and the Group, as well as the impact of the Company and the Group on society and the environment, and we identify our materiality after discussions by the ESG Promotion Committee.

[Note]

*3
Environmental and social impacts on the company and the company's impacts on the environment and society

1Expand and enhance the efficiency of the industrial base through cutting-edge technologies
2Create new industries through DX
3Revitalize local communities (regional revitalization)
4Realize attractive customer value through the spread of smart devices
5Provide an environment in which everyone can access information
6Leveraging ICT to create new lifestyles and enhance the foundations for daily life
7Develop new business models with cutting-edge technologies
8Incubate and spiral-up cutting-edge businesses overseas
9Build systems to recruit and develop human resources to lead growth and create new businesses
10Contribution to climate change policy/measures through technology and business
11Promote a recycling-based society (circular economy)
12Realize a prosperous society through the spread of renewable energy
13Prepare sustainable life infrastructure
14Construct robust communications infrastructure to contribute to disaster prevention and mitigation
15Promotion of data security and privacy protection initiatives
16Enhance corporate governance and ensure its effectiveness
17Sustainable growth through cooperation with stakeholders
18Enhance employee happiness with diversity and inclusion
19Enhance productivity with advanced workplace environments

Principle of double materiality

Our materiality issues are identified on the principle of double materiality as advocated by international guidelines and others, and considering not only the impact of society and the environment on the Company and the Group but also the impact of our corporate and business activities on society and the environment.These impacts of the company are considered with respect to both positive and negative impacts on each stakeholder.

Material issues	Impact on society and the environment		Major Stakeholders
Building Society and Industry through DX	Positive	Expansion of industrial infrastructure and efficiency through cutting-edge technology (Including improving labor productivity and labor shortages) Creation of new businesses and industries through DX Revitalizing local communities through the use of technology (Regional Revitalization)	Customer Local community
Building Society and Industry through DX	Negative	Changes in employment structure due to DX/industrial transformation	Customer Local community
Connecting people and information to create new excitement	Positive	Provide advanced communications and ICT through the spread of smart devices to realize new information experiences and attractive value Provide an environment in which everyone can access information Leverage ICT to create new lifestyles and enhance the foundations for daily life (Online shopping, cashless society, advanced ICT in healthcare/education, etc.)	Customer Local community
Connecting people and information to create new excitement	Negative	An environment is needed to curb the digital divide and other information disparities, and to make information accessible to everyone, including the elderly, people with disabilities, and the poor Concerns about the impact of cyberbullying and crime due to improper access to information and use of the Internet	Customer Local community
Creating new business through open innovation	Positive	Promote the implementation of digital society by developing new business models using cutting-edge technologies Progress in creating new value in Japan through cutting-edge overseas business incubation and spiral-up Establish a mechanism for business creation that drives growth Develop digital human resources capable of utilizing the latest technologies and implementing them in society	Customer Employees Shareholders/investors Local community
Creating new business through open innovation	Negative	Concerns about disrupting existing businesses by developing new businesses and services
Contributing to the global environment with the power of technology	Positive	Contribute to mitigate climate change through technology and business Promote a recycling-based society (circular economy) Realize a prosperous society through the spread of natural energy	Customer Employees Shareholders/investors Local community Environment
	Negative	GHG emissions through electricity use generated by the business Environmental and social impacts associated with the use of resources (Rare metals, forests, wastewater, waste, etc.) Environmental impact such as deforestation due to installation of base stations in mountainous areas
Building high-quality social communication networks	Positive	Enjoyment of sustainable living infrastructure Building a solid communications infrastructure that contributes to disaster prevention and mitigation	Customer Employees Shareholders/investors Local community
Building high-quality social communication networks	Negative	Delays in restoration in the event of communication failures or infrastructure disruptions due to natural disasters Impact on data security due to cyber attack damage, etc.
Developing a resilient management foundation	Positive	Contribution to market stability by ensuring the sophistication and effectiveness of corporate governance Developing a sustainable society through collaboration with stakeholders Improve employee happiness and promote diversity inclusion to create a rewarding work environment where everyone can fulfill their potential Advanced Work Environment	Employees Shareholders/investors Local community NGOs/NPOs
Developing a resilient management foundation	Negative	Lack of governance response resulting in loss of trust by business partners and shareholders Environmental and social impacts on the supply chain (Human rights, occupational health and safety, conflict minerals, etc.)

Integrate sustainability-related risks into enterprise-wide risk management

We integrate sustainability risks related to identified material issues (e.g., climate change, human resource development and retention, etc.)into company-wide risk management..
Every half year, the Risk Management Committee, whose members include the president, vice presidents, CFO, etc., and which is attended by corporate auditors and the heads of related departments, is held to evaluate and monitor risks and to review risks. Please refer to Risk Management for specific risk descriptions and management systems.

Social impact measurement and evaluation

In addition to monitoring the outputs related to the identified material issues through Material Issue KPIs, we measure and evaluate the impact on society (social impact) of some of the materiality-related projects.

Initiatives	Impact on external stakeholders	Amount of money	Related material issues
Smartphone classes	Reducing the social cost associated with learning how to use smartphones will promote the participation in the digitalized society, i.e. access to information, by elderly individuals. Increasing the new experiences through the use of smartphones by elderly individuals will bring economic benefits to the entire society.	4710 million yen^*1	“Connecting People and Information to Create New Excitement” （2）Provide an environment in which everyone can access information
Mobile phone recycling	The overall cost of industrial waste disposal and management in the entire society will be reduced. The useful metals contained in used mobile phones are returned to society, promoting the transition to a circular economy.	1057 million yen^*2	“Contributing to the Global Environment with the Power of Technology” （2）Promote a recycling-based society (circular economy)