Human Capital

Our Basic Approach

To continue contributing to society through our business, we believe it is essential that our company and our employees grow together. This is why we focus on recruiting diverse talent, investing in their development, and placing them in roles where they can excel. When individuals grow, the company grows; and as the company grows, it creates new opportunities for individuals to develop further. This virtuous cycle enables us to achieve sustainable growth while expanding our overall contribution to society.

"The pursuit of PROFESSIONALISM with PASSION and INTEGRITY" is our human resource principle. We recognize that attracting and developing people who embody this principle and who can adapt and grow on their own initiative in a rapidly changing business environment is essential to the sustainable growth of SMS Group.

Based on this approach, we are advancing our human capital investments and initiatives guided by the policies below. We regard the initiatives described under each policy as human capital investments, and the examples presented are drawn primarily from SMS Co., Ltd.

Attracting and developing Mission-driven talent who grow and create value

As mentioned above, the growth of SMS Group leads to greater social contribution through the resolution of social issues. For our organization to keep growing over the long term, it is essential that we continue to attract and retain employees with the capabilities our growth requires. In particular, given the current business environment, we are evolving toward a capital-intensive model that fully leverages AI and data, while expanding into new business domains. To advance both, we are focusing on attracting and developing digital talent with strong technical expertise and a business perspective, as well as next-generation leaders who can build new businesses. We also believe it is vital that each employee grows and that their sense of purpose connects with our Management Philosophy and Mission — both of which drive the development of our organization. In order to realize our Management Philosophy of "continual growth and contribution to society as an everlasting corporate group," we have established two Management Principles: "mutual development of our organization and our people" and "horizontal and vertical linkage of the management processes." Realizing this Philosophy requires sustained investment in our people over the medium to long term, and these Principles form the foundation of that effort. Guided by these Principles, we foster employee growth and embed our Philosophy across the organization, so that individual capabilities are effectively translated into organizational strength and sustained development.

"Mutual development of our organization and our people"

We have grown our revenue every year since our establishment, delivering continual growth and, through it, contribution to society. For our organization to keep growing over the long term, the growth of each individual employee is essential.

As our organization grows, we create new opportunities for our people, which in turn accelerates their growth. As individuals grow, so does the value they create — and by cascading our Group Mission from each business unit down to individual goals, we channel that value into organizational growth and greater contribution to society.

Employee growth through these opportunities drives the growth of the company, which in turn creates further opportunities for growth. By sustaining this cycle of growth and contribution, we aim to achieve mutual development of our organization and our people over the medium to long term.

"Horizontal and vertical linkage of the management processes"

By management process, we mean thinking and acting in an integrated way across three dimensions of running a business: strategy, people, and operations. In an environment that is highly complex and continues to change over the long term, we believe it is essential that every employee be able to drive this process on their own initiative. We therefore expect employees in every role — not only executives and business leaders — to take ownership of the management process and create greater value.

We not only run the management process at the Group, Strategic Unit (SU), Business Unit (BU), and individual levels, but also connect it vertically from the Group level down to each individual. This alignment ensures that the value created at every level is consistent with our Mission, and channels the contributions made at each level into the contribution of the Group as a whole (vertical linkage).

We also connect the process horizontally between neighboring teams and individuals, generating synergies and producing a greater contribution than any one team could make on its own (horizontal linkage).

By linking the management process both vertically and horizontally, we foster mutual development of our organization and our people, and pursue our Mission as one organization. By sharing the knowledge and capabilities we have accumulated through continuous growth across our organization, we can achieve growth beyond what any individual could accomplish alone — and continue to expand our overall contribution to society.

Key Initiatives — Attracting and developing Mission-driven talent who grow and create value

• One-on-one meeting
  In regular one-on-one meetings, managers and team members align on goals grounded in the management process, and discuss the careers team members want to build at SMS, the challenges involved, and the concrete steps to get there. Through these conversations, we embed our Management Philosophy and steadily develop our people.


• Career survey
  In order to achieve mutual development of our organization and our people, we conduct a career survey every six months. In addition to understanding each employee's thoughts and aspirations regarding their career development, this survey also serves as an employee engagement and satisfaction survey to gauge their satisfaction with their jobs and the workplace environment. We leverage this feedback not only to support career paths aligned with personal ambitions but also to continuously refine our HR systems and foster a supportive and fulfilling work environment.


• Structured, long-term development program for new graduates
  To help new graduates develop their careers on their own initiative, we provide a structured training program spanning several months. It begins with a group onboarding program where they learn our corporate philosophy and acquire foundational business skills. This is followed by department-specific training, where participants progressively build industry expertise and practical capabilities through classroom learning and hands-on application. We also foster an environment of mutual learning and growth, supported by a feedback framework — comprising daily self-reflection and regular one-on-one sessions with dedicated trainers — alongside mechanisms for knowledge sharing among peers in the same cohort.


• Developing next-generation leaders and managers
  To cultivate future leaders capable of guiding our business and organization, we deliver practical leadership development programs tailored to the specific characteristics and circumstances of each business. For example, in one business division, we provide continuous training for newly appointed managers and manager candidates through a recurring cycle of real-world application and reflection. This approach equips them with competencies such as dialogue techniques to align business strategy with individual team members' values, role design that promotes team members' growth, and job assignment skills.


• Qualification support program
  We cover examination fees and study materials for employees who earn qualifications relevant to their work.


• Skill development training
  We offer a variety of training programs to improve business, language, and management skills. We are also committed to enhancing our employees' digital skills. Our initiatives include hosting workshops on leveraging generative AI and sharing information and best practices through our internal support portal.


• Book purchase program
  We cover the cost of books that support employees' self-directed skill development or their day-to-day work.


• Skill development allowance
  An allowance of 150,000 yen is provided once a year to support employees' skill development and career advancement.


• Internal job posting program
  With the growth of each business, various roles are created and expanded across our teams continuously. We conduct internal job postings several times a year to create synergy between teams by leveraging the skills and experience of each employee, and to provide career development opportunities for employees who are motivated to pursue the many roles that exist within the company.

Developing a work environment that maximizes individual potential and promoting well-being

In order to continue to create value with high productivity by expanding the scale of our organization while recruiting and training diverse employees, it is essential to develop a work environment that is comfortable and rewarding for employees in diverse situations, including differences in backgrounds and changes in life stages such as family care. We work to maintain and improve the health of employees so that each individual can work in good mental and physical health, and implement initiatives to enable proactive career development by providing support for achieving individual growth and work-life balance.

While the specific components of our employee benefits vary based on regional regulations, local customs, and employment status, we have established frameworks so that all SMS Group members — including those at overseas locations and non-permanent employees — have access to benefits tailored to their respective circumstances. By providing support such as social insurance, leave entitlements, and health initiatives, we aim to create a workplace where every employee can work with peace of mind.

Key Initiatives — Developing a work environment that maximizes individual potential and promoting well-being

• Office closing time
  In order to encourage employees to work productively within business hours and to pursue self-improvement after work, we have set 19:30 as the time by which employees are expected to leave the office.
  *The time is set within up to two hours after the end of regular work hours and may vary depending on the employee's department or job type.


• Anniversary leave
  Employees can take one paid day off per year, on a day of their choosing, as Anniversary Leave.


• Promoting well-being
  We have established the Health Promotion Office, which reports directly to the CEO, and are advancing a variety of initiatives to promote the physical and mental health of our employees and increase productivity. In terms of health, we consider early detection of lifestyle-related diseases an important priority and focus on improving the follow-up examination attendance rate. We have also set up an in-house consultation desk staffed by a resident public health nurse, and provide mental health support and promote health literacy in cooperation with occupational physicians and our health insurance association. In addition, given that many of our employees are raising children, we are strengthening support for balancing life events with work. We have put in place paid leave in hourly increments, a guidebook for male employees taking childcare leave, communication tools for use during childcare leave, and a leave program for fertility treatment, among other measures, to create an environment in which employees can put their abilities to use with peace of mind over the long term.
  Health and Productivity Management


• Support for childcare and elderly care
  We support our employees in balancing work with childcare and elderly care through programs such as childcare leave, elderly care leave, shorter working hours available until their children enter junior high school, and allowances for nursery schools, after-school care, and babysitters. In addition, we offer assistance through an internal portal containing information on childcare and elderly care, as well as employee access to the elderly care consultation service in our Senior Life Business. We have also registered our initiatives supporting the balance of work and elderly care on "Ryoritsu Shien no Hiroba" (Work-Life Balance Support Square), an information website operated by the Ministry of Health, Labour and Welfare to promote efforts that help working individuals balance work and family life.
  
  *The "Tomonin" mark is a symbol created by the Ministry of Health, Labour and Welfare that can be used by companies actively promoting support for employees to balance work with elderly care.

Building an organization where people with diverse personalities and backgrounds can thrive

SMS Group operates a diverse range of businesses to solve social issues, and this requires an equally diverse workforce. As a foundation for diversity, we are working to foster a corporate culture in which each individual, regardless of background, personality, employment status, or lifestyle, is respected and recognized without discrimination, and can grow together with others. In addition, we believe that we can expand the scale of our organization while maintaining diversity by hiring a large number of talented people with diverse backgrounds, both new graduates and mid-career professionals, supporting their further growth, and developing an environment in which individuals can work productively and with a sense of purpose while leveraging their abilities.

Our initiatives – Building an organization where people with diverse personalities and backgrounds can thrive

• DEI&B (Diversity, Equity, Inclusion, and Belonging) promotion project
  In the fiscal year ended March 31, 2025, we launched the "DEI&B Promotion Project" to create an environment in which diverse employees can work more comfortably and take ownership of their careers. Under this project, we are implementing measures to promote women's career advancement in parts of our recruiting agent business.

• *Acquisition of "Platinum Eruboshi Certification"
  We have obtained the "Platinum Eruboshi Certification," which is awarded by the Minister of Health, Labour and Welfare under the Act on Promotion of Female Participation and Advancement in the Workplace. This certification is granted to companies that have already received the "Eruboshi Certification" and have demonstrated a higher standard of initiatives for promoting women's workplace participation and advancement.

• Employment of people with disabilities and placement according to individual characteristics and abilities
  As our total headcount continues to grow, the number of employees with disabilities is also increasing year by year. While providing appropriate accommodations, we assign roles based on each person's individual characteristics, abilities, and preferences, creating an environment where all employees — with and without disabilities — work together and find their work engaging and meaningful.


• Prohibition of discrimination and harassment, and establishment of whistle-blowing hotlines
  Based on the "SMS Human Rights Policy," we prohibit all discrimination based on race, gender, nationality, ethnicity, language, religion, political or other opinion, national or social origin, property, sexual orientation, gender identity, health condition, or disability, and prohibit power harassment, sexual harassment, and all other forms of harassment, whether mental or physical. To ensure strict compliance, we have established hotlines available 24 hours a day, 365 days a year, where individuals can report and seek advice on violations of laws and internal rules, as well as harassment in the workplace.

Policy on determining employee compensation

Based on our Management Principle of "mutual development of organizations and individuals," SMS Group's basic approach to our compensation system is to encourage the medium- to long-term growth of employees and support their contribution to achieving our Mission through the exercise of their respective abilities. Specifically, we have introduced a competency-based grading system, which reflects the competencies required for the role an employee performs in each job type, regardless of age or years of service. By evaluating the degree to which required abilities have been achieved based on the role and ability requirements defined for each job type, and determining grades accordingly, we have built a fair and highly transparent evaluation and compensation system.

With regard to compensation levels, in order to secure people needed to realize our Mission, we benchmark against listed companies of a similar business scale and business phase, and set compensation at a level that ensures market competitiveness.

With regard to compensation structure, rather than evaluating only short-term results, we have adopted a compensation system centered on base salary, based on the idea of evaluating employees' growth in ability that leads to medium- to long-term results. For certain job types, we also pay bonuses to reward individual performance results. In addition, we provide a "skill development allowance" to support employees' self-improvement and career advancement.

Key initiatives as medium- to long-term incentives

• Employee stock ownership plan
  In order to enhance employee benefits and motivate employees to pursue business growth, we have established an employee stock ownership plan, which is open to employees regardless of position and provides a 10% subsidy on employee contributions. The plan is available to all regular and contract employees of SMS Co., Ltd. and SMS Support Service Co., Ltd.


• Stock option
  We grant stock options to employees above a certain grade to strengthen their motivation and commitment to contributing to the Company's growth.

For actual performance data on related indicators, please refer to ESG Data.