Sustainability Management
The LY Corporation Group (the “Group”) is dedicated to engaging with social issues through its business activities, aiming to achieve both a sustainable society and corporate growth. The Group has identified six material topics representing sustainability-related risks and opportunities that are important to its business strategy and value creation. By continuously monitoring these material topics and reflecting them in its metrics, targets, and initiatives, the Group advances efforts to both address potential risks and create new growth opportunities.
Basic Policy on Sustainability
The LY Corporation Group’s mission is to "WOW Our Users!" The Group will bring positive impact to society through its businesses and promote sustainability management that takes responsibility for future generations by addressing social issues, including the global environment and human rights.
To promote sustainability management, the LY Corporation Group establishes the following Basic Policy on Sustainability and identifies six material topics.
- Promote sustainability from the standpoints of both society and business
- Work collectively to address sustainability while taking advantage of the unique characteristics of each Group company
- Take on challenges without being bound by precedents, and strive to continuously generate innovation
Sustainability Management Structure
To promote Group-wide efforts to address sustainability-related issues, LY Corporation (the “Company”) has established a governance structure under which the Board of Directors is responsible for overseeing the Group’s material topics. To ensure their appropriate assessment and management, the Sustainability Committee, chaired by the President and Representative Director, has been established as the executive body responsible for sustainability matters. Working in coordination with the Risk Management Committee, the Sustainability Committee identifies material topics and monitors response measures, as well as progress against related metrics and targets. The Sustainability Committee submits matters for deliberation to the Board of Directors and reports on them approximately three times a year. This framework enables the Board of Directors to exercise effective oversight.
The overall relationship between the Board of Directors' oversight and the operational framework is illustrated in the Diagram on Corporate Governance System.
Roles of Each Organization
*Please scroll horizontally for more information.
| Organization | Roles | Composition | Frequency of meetings | Major agenda |
|---|---|---|---|---|
| Sustainability Committee | Executive body responsible for managing the Group’s material topics and formulating policies and strategies |
Chair: President and Representative Director Members:
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In principle, four times a year |
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| Environment Working Group | Assessment of environmental risks and opportunities across the Group, and review and promotion of related measures |
Chair: Corporate Officer (Sustainability CBU Lead) Members: Environmental officers from each Group company |
In principle, three times a year |
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| Human Rights Working Group | Assessment of human rights-related risks and opportunities across the Group, and review and promotion of related policies and measures |
Chair: Human Resources & General Affairs CBU Lead Vice Chair: Corporate Officer (Sustainability CBU Lead) |
In principle, twice a year |
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| Risk Management Committee | Identification of significant risks of the Group and policy decisions related to risk management |
Chair: President and Representative Director Members:
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In principle, three times a year |
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To enable the Board of Directors to appropriately oversee strategies for addressing the Group’s material topics, the Company has defined “Expertise and experience in sustainability issues such as environmental and social issues” as a sustainability skill from FY2026 and ensures that such expertise is represented in the composition of the Board of Directors. This skill serves as a prerequisite for understanding changes in the external environment, as well as sustainability-related risks and opportunities, including those related to climate and human rights. Supported by a diverse range of expertise, including this sustainability skill, the Board of Directors deliberates and makes decisions on important matters based on information provided through the Sustainability Committee and other relevant bodies.
In addition, to ensure that the Board of Directors remains well informed of the latest sustainability-related developments and their impact on the Group, directors are provided with ongoing opportunities to obtain information and deepen their knowledge in accordance with their respective roles. In FY2025, outside directors received internal briefings on developments in the AI landscape, while external experts and specialized organizations provided lectures on the latest sustainability-related regulatory developments. Furthermore, the Sustainability Committee has established a framework under which external experts are regularly invited to provide the latest insights into medium- to long-term sustainability trends and changes in the business environment. Through these initiatives tailored to specific areas of expertise and responsibilities, LY Corporation promotes the continuous development of directors’ skills and enhances the effectiveness of oversight by the Board of Directors as a whole.
The Board of Directors oversees the target-setting by receiving reports on the metrics and targets for the Group’s material topics developed by the Sustainability Committee and deliberating on and approving their appropriateness. In addition, the Board regularly monitors progress toward the established targets. To enhance effectiveness, a “sustainability evaluation” is incorporated into the criteria used to determine executive remuneration (cash bonuses), with an adjustment of up to ±5%. In the sustainability evaluation, a comprehensive evaluation is conducted based not only on performance against the metrics for the Group’s material topics, but also on progress toward targets, the quality of initiatives, social impact, and other factors, with a view to fulfilling the Group’s mission and enhancing corporate value over the medium to long term. This evaluation metrics (±5%) is deliberated on and determined by the Nominating and Remuneration Committee, a majority of whose members are independent outside directors. For details on the remuneration policy, please refer to the corporate governance page below.
Related Links
Corporate Governance
Risk Management
LY Corporation has established an ERM (Enterprise Risk Management) framework through the Risk Management Committee and its subordinate Supervisory Organization of Risk Management. The ERM framework provides a Group-wide risk management structure designed to comprehensively identify and appropriately address management and business-related risks at the LY Corporation Group. Sustainability-related risks and opportunities are also collected from Group companies through the ERM framework.
Related Links
Enterprise Risk Management (ERM)
Material Topics for the LY Corporation Group
The Company’s Views on Material Topics
LY Corporation strives to stay close to users and drive positive changes in society under its mission to "WOW Our Users!" In recent years, rapid changes in the social and business environment have been driven by factors such as accelerating technological innovation, including generative AI, climate change, and concerns over information security. In response to these medium- to long-term societal trends, the Company recognizes the need not only to adapt to change but also to take a leading role in driving the change. To fulfill this mission, the Company leverages its strength of having diverse user touchpoints through services that are deeply embedded in people’s daily lives, including media, commerce, and payment and finance-related services. By doing so, the Company seeks to address both societal challenges as well as the management challenges it faces, viewing them as opportunities to create new value.
Based on this approach, the Company has identified material topics as the framework for achieving both a sustainable society and corporate growth through the mitigation of risks and the creation of new opportunities.
Material Topics Formulation Process
To ensure a proactive response to both social issues and the sustainable enhancement of corporate value, the Company systematically identifies material topics at the Group-wide level. This process is grounded in an analysis of risks and opportunities based on social expectations and the ERM framework.
The Group considers how social and environmental changes affect its business, and how its activities impact society and the environment—across short-, medium-, and long-term horizons—to determine priority topics.
The evaluation process incorporates feedback from executives, business unit leaders, Group companies, and stakeholders such as customers, partners, and employees. It also includes desktop research and multifaceted input from government officials and ESG experts.
To ensure objectivity and transparency in the identification and disclosure process, the Group refers to international reporting standards, including those established by the GRI, SASB, and others.
The identified material topics are integrated into management through discussions by the Sustainability Committee and approval and oversight by the Board of Directors, and are regularly reviewed to reflect changes in society and business.
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* For details on the evaluation process for sustainability-related risks and opportunities, please refer to the Annual Securities Report(Japanese Only).
Materiality Map
When creating the materiality map, the impact on corporate value is assessed from both quantitative and qualitative perspectives, based on the relative significance of identified risks and opportunities. The identified material sub-topics are then mapped using two evaluation axes: “level of stakeholder concern” and “importance to the LY Corporation Group.”
Identification of Material Topics
Material sub-topics identified in the materiality map were reviewed and grouped based on their alignment with the LY Corporation Group’s core strengths, its diverse business domains, and evolving social and business conditions. Upon receiving approval from the Board of Directors, six material topics were defined for the LY Corporation Group.
*Please scroll horizontally for more information.
| Identified Material Topics | Explanation | Material sub-topics | Stakeholders |
|---|---|---|---|
| Delivering Amazing Experiences Through Data & AI | The Group aims to enrich people’s lives and society by providing life platforms that deliver personalized services and high-quality user experiences through the use of generative AI, data, and other information technologies. |
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Customers Partners National and local governments Employees Regional communities Shareholders and other investors |
| Operating Safe & Secure Digital Platforms | The Group is committed to building and operating safe and secure digital platforms that ensure security, privacy, and fairness, creating an environment where everyone can securely access reliable, safe, and fair information every day. |
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| Addressing Disasters and the Digital Divide | The Group will contribute to an inclusive society where everyone can access information and services at any time through digital technology, by working with diverse public and private partners to respond to disasters and bridge the digital divide through IT literacy education. |
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| Establishing Governance to Support Sustainable Growth | The Group strives to build a corporate foundation that earns the trust of society and enables continuous business growth, by developing a governance framework that emphasizes both effectiveness and transparency, and by ensuring thorough compliance and risk management. |
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| Maximizing Human Capital Value | The Group aims to enhance human capital value by strengthening talent and fostering corporate culture, creating a foundation for individual growth through continuous challenges, and developing an environment rooted in understanding and respect for diversity to maximize both individual and organizational performance. |
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| Fulfilling Environmental Responsibilities for Future Generations | Through the adoption of renewable energy, construction of next-generation data centers, and provision of eco-friendly products, the Group works to address climate change, conserve natural capital, and promote resource circulation through its businesses and services, contributing to a sustainable planet where future generations can thrive. |
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Approach to Material Topics
Through its materiality initiatives, the Company aims to fulfill its mission, to "WOW Our Users!" To this end, it identifies risks and opportunities, sets indicators and targets, and monitors progress on an ongoing basis from both quantitative and qualitative perspectives. The scope of these indicators and targets may apply to the LY Corporation Group or LY Corporation alone, with achievement timelines set individually based on the progress of each topic.
In addition, the Company identifies the time horizons over which the impacts of risks and opportunities can reasonably be expected to materialize. The definitions of these time horizons are as follows. In defining these time horizons, consideration is given to consistency with the definitions of likelihood used in the ERM framework (i.e., the probability or frequency with which a risk may materialize), thereby enabling an integrated approach to company-wide decision-making and strategies related to the material topics.
Definition of time horizons
Short term: 1 year
Medium term: 3 years
Long term: 5 to 10 years
- Delivering Amazing Experiences Through Data & AI
- Operating Safe & Secure Digital Platforms
- Addressing Disasters and the Digital Divide
- Establishing Governance to Support Sustainable Growth
- Maximizing Human Capital Value
- Fulfilling Environmental Responsibilities for Future Generations
Delivering Amazing Experiences Through Data & AI
The Group aims to enrich people’s lives and society by providing life platforms that deliver personalized services and high-quality user experiences through the use of generative AI, data, and other information technologies.
Material Sub-Topics
- Use of data
- Deployment of AI
- Enhancement of customer experiences and satisfaction
- Advancement of fintech services
| Risks | User attrition resulting from an inability to maintain and enhance the Company's competitiveness and customer satisfaction due to delays in the development of new data- and AI-driven services, quality deficiencies, or insufficient improvement of existing services | Short to medium term |
|---|---|---|
| Opportunities | User acquisition resulting from the maintenance and enhancement of the Company's competitiveness and customer satisfaction through the creation of new data- and AI-driven services and the advancement of existing services | Short to medium term |
| Metrics | Target | FY2024 Results | FY2025 Results |
|---|---|---|---|
| LINE MAU/Population *1*2 | 75% or more | 79.4% | 81.3% |
| Yahoo! JAPAN DUB *3 | 110 million or more | 108 million | 107 million |
*1 A metric created by the Group to represent the number of users.
*2 Calculated by dividing the number of users who have activated LINE with a valid account within each month by the total population (in Japan)
*3 The number of browsers used to access Yahoo! JAPAN services. If both the browser and the app on a smartphone are used, they are counted as duplicates.
| Initiatives |
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The Company has introduced new features such as “LINE AI Talk Suggestions” and the AI Assistant feature in the Yahoo! JAPAN app, continuously delivering AI-powered value and experiences to users. Major Initiatives and Achievements
LINE AI and LINE AI Talk Suggestions 
Integration with AI Assistant feature
Related Initiatives |
Operating Safe & Secure Digital Platforms
The Group is committed to building and operating safe and secure digital platforms that ensure security, privacy, and fairness, creating an environment where everyone can securely access reliable, safe, and fair information every day.
Material Sub-Topics
- Reinforcement of security governance and privacy protection
- Establishment of AI ethics and governance
- Provision of reliable life infrastructure
- Maintenance of integrity in internet advertising
- Countermeasures against illegal and harmful content
- Ensuring accessibility
- Creation of a trustworthy information environment with respect for freedom of expression
| Risks | A decline in public trust resulting from insufficient measures to ensure security governance, AI ethics, transparency, and other areas requiring attention as a provider of infrastructure services that support everyday life, as well as increased operating costs and loss of public trust resulting from incidents or service disruptions | Short to long term |
|---|---|---|
| Opportunities | Enhanced brand value, strengthened competitive advantage, and a more stable revenue base resulting from the trust gained by fulfilling the social responsibilities expected of a provider of infrastructure services that support everyday life, including ensuring security governance, AI ethics, transparency, and other related areas | Short to long term |
| Metrics | Target | FY2024 Results | FY2025 Results |
|---|---|---|---|
| Number of critical security incidents *1 | 0 | 1 | 0 |
*1 Critical cases at LY Corporation involving inquiries or administrative guidance from regulatory authorities
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The Company has implemented comprehensive cybersecurity measures based on international standards and established frameworks for the protection and management of user data. In addition, based on its Basic Policy on AI Ethics, the Company has enhanced the effectiveness of the policy and developed internal operational rules, thereby establishing a framework for the appropriate use of AI. Major Initiatives and Achievements
Related Initiatives |
Addressing Disasters and the Digital Divide
The Group will contribute to an inclusive society where everyone can access information and services at any time through digital technology, by working with diverse public and private partners to respond to disasters and bridge the digital divide through IT literacy education.
Material Sub-Topics
- Disaster preparedness, mitigation, and recovery support and pandemic response
- Bridging the digital divide through IT literacy education
- Enhancing convenience through digitalization
- Development of local communities
| Risks | A decline in public reputation resulting from insufficient contributions to addressing issues in a manner that supports the sustainability of society as a whole, including disaster preparedness and response, pandemic response, advancement of public services, improvement of information literacy, and regional revitalization | Medium to long term |
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| Opportunities | Enhanced public reputation resulting from contributions to addressing issues in a manner that supports the sustainability of society as a whole, including the advancement of public services, improvement of information literacy, and regional revitalization, as well as from the development of new customers through new services created to support disaster preparedness and response and pandemic response | Medium to long term |
| Metrics | Target | FY2024 Results | FY2025 Results |
|---|---|---|---|
| Population coverage rate through disaster agreements with local governments *1*2 | 95% or more | 98.6% | 98.5% |
| Number of municipalities with LINE Official Accounts *3 | 1,788 by 2030 | 1,522 | 1,582 |
*1 Calculated as the total population of municipalities that have signed disaster agreements with LY Corporation, divided by the total population.
*2 From this fiscal year, the FY2025 Basic Resident Register was used for population calculations. As population figures through the previous fiscal year were based on the FY2019 Basic Resident Register, the population coverage rate through disaster agreements with local governments decreased although the number of local governments concluding disaster agreements increased.
*3 Number of municipalities that have launched and managed a LINE Official Account under the special municipal plan.
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The Company has continued initiatives such as ensuring the reliable delivery of information during both normal times and disasters through collaboration with local governments, as well as publishing case studies on the use of LINE Official Accounts during disasters. These efforts have contributed to maintaining population coverage under disaster agreements with local governments and increasing the number of municipalities establishing LINE Official Accounts. Major Initiatives and Achievements
Special Feature on the Noto Peninsula Earthquake
Related Initiatives |
Establishing Governance to Support Sustainable Growth
The Group strives to build a corporate foundation that earns the trust of society and enables continuous business growth, by developing a governance framework that emphasizes both effectiveness and transparency, and by ensuring thorough compliance and risk management.
Issues
- Thorough risk management
- Respect for human rights
- Maintenance of sound and effective corporate governance
- Thorough compliance and prevention of corruption
- Strengthening of supply chain management
- Ensuring a stable financial foundation
- Maintenance of a fair competitive environment
- Respect for and protection of intellectual property
| Risks | Insufficient responses to risk management, compliance, financial foundation strengthening, and respect for human rights resulting from a failure to establish an effective governance framework, ultimately leading to impaired business continuity and a decline in public trust and reputation | Medium to long term |
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| Opportunities | Enhanced business continuity and financial stability, establishment of a competitive advantage, expanded opportunities for new business transactions and financing, and increased corporate value through the trust gained from customers, investors, and regulatory authorities as a result of establishing a robust and effective governance framework and ensuring strong risk response capabilities and a high level of awareness of compliance and respect for human rights | Medium to long term |
| Metrics | Target | FY2024 Results | FY2025 Results |
|---|---|---|---|
| Board effectiveness assessment results (conducted once a year) *1 | Rating confirming the board’s effectiveness | Assessed as maintaining effectiveness | Assessed as maintaining effectiveness |
| Completion rate of e-learnings on compliance issues *2 | 90% or more | 98% | 95% |
*1 The evaluation was conducted through interviews and questionnaires administered to LY Corporation’s directors, with the effectiveness results assessed by the Board.
*2 Data reflects annual training performance compiled from LY Corporation and its subsidiaries that outsource their training programs to LY Corporation, including information on training topics, intended audiences, and number of participants.
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To maintain an appropriate management framework, the Company promotes the effectiveness of the Board of Directors and the identification and disclosure of annual priority issues by conducting Board effectiveness evaluations using multifaceted methods, including questionnaires for all directors. The Company also promotes awareness of compliance through compliance e-learning programs for all employees. Major Initiatives and Achievements
Related Initiatives |
Maximizing Human Capital Value
The Group aims to enhance human capital value by strengthening talent and fostering corporate culture, creating a foundation for individual growth through continuous challenges, and developing an environment rooted in understanding and respect for diversity to maximize both individual and organizational performance.
Material Sub-Topics
- Development of human resources
- Fostering corporate culture
- Respect for human rights
- Promotion of diversity, equity, and inclusion
| Risks | Adverse impacts on business operations, including reduced employee performance, outcomes, and productivity, as well as delays in the development of new services and products, resulting from insufficient recruitment and development of talent with diverse perspectives and values and from mismatches between workforce skills and business strategy arising from advances in AI technologies. | Short to long term |
|---|---|---|
| Opportunities | Promotion of the success of talent with diverse perspectives and values through greater understanding and respect for diversity and by providing learning opportunities for all employees to develop AI capabilities. Enhanced organizational expertise and adaptability through the acquisition and retention of AI skills, business transformation in response to rapid advances in AI technologies, and accelerated business growth through improved productivity and the creation of new services and products. | Short to long term |
| Metrics | Target | FY2024 Results | FY2025 Results |
|---|---|---|---|
| Changes in aggregate values of items related to “growth support,” “environment,” and “philosophy strategy,” in the engagement survey *1 | Maintain or improve compared to previous fiscal year |
(Standalone) No maintenance or improvement observed *2 |
(LY Corporation Group) No maintenance or improvement observed *2 |
| Ratio of females in managerial positions *3 | By 2030, same level as the gender composition of entire employees | 19% *4 | 19% *4 |
*1 Group-wide year-on-year performance in the engagement survey categories of growth support, environment, and philosophy strategy is evaluated using a three-point scale: improvement, maintenance, or no maintenance/improvement.
*2 As the scope was changed from LY Corporation on a standalone basis to the Group beginning in FY2025, the FY2025 results are not directly comparable with the FY2024 results.
*3 Figure as of March 31 for each fiscal year for LY Corporation (standalone). Managers refer to Division Leads, Unit Leads, SBU/CBU Leads, and Domain Leads.
*4 As certain calculation definitions were revised beginning in FY2025, the FY2025 results are not directly comparable with the FY2024 results.
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The Company promotes the mandatory use of generative AI to improve productivity and drive innovation, advances hybrid work to balance flexible work styles with high-quality communication, and promotes the sharing of initiatives through two-way communication between management and employees at company-wide town hall meetings. Major Initiatives and Achievements
Related Initiatives |
Fulfilling Environmental Responsibilities for Future Generations
Through the adoption of renewable energy, construction of next-generation data centers, and provision of eco-friendly products, the Group works to address climate change, conserve natural capital, and promote resource circulation through its businesses and services, contributing to a sustainable planet where future generations can thrive.
Material Sub-Topics
- Response to climate change and conservation of natural capital
- Strengthening of supply chain management
- Realization of a circular economy
Climate-related *1 |
Risks |
Transition risks:
Physical risks:
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Short to medium term *2 |
Opportunities |
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| Non-climate-related | Risks |
Decline in public trust resulting from insufficient implementation of measures related to water resource conservation, waste reduction, and others accompanied by reduced competitiveness, additional costs, and risks of business disruption |
Medium to long term |
Opportunities |
Acquisition of new business opportunities through the creation of resource-circulating services, including reuse businesses; enhanced corporate reputation through water resource conservation; and secured business continuity through the avoidance of water-related risks |
Medium to long term |
*1 For details on climate-related risks and opportunities, please refer to Legal Compliance and Fulfillment of Responsibilities in the International Community.
*2 The Company defines the short-, medium-, and long-term time horizons over which the impacts of climate-related risks and opportunities could reasonably be expected to occur as follows:
Definition of time horizons
Short-term: Through 2030 (GHG-related investment plans, carbon neutrality target)
Medium-term: Through 2035 (Japanese government NDC target)
Long-term: Through 2050 (net zero target)
| Metrics | Target | FY2024 Results | FY2025 Results |
|---|---|---|---|
| Scope 1, 2 & 3 GHG emissions *1*2 |
Scope 1 & 2 to net-zero by FY2025 (LY Corporation (standalone)) |
8,400 (mtCO2e) |
0 (mtCO2e) |
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Scope 1 & 2 to net-zero by FY2030 (LY Corporation Group) |
19,689 (mtCO2e) |
10,583 (mtCO2e) |
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Scope 1, 2 & 3 to net-zero by FY2050 |
4,004,124 (mtCO2e) |
3,066,970 (mtCO2e) |
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| Water consumption (per JPY1 million in revenue) |
10% reduction by FY2030 (Compared to FY2022) |
0.312*3 (m3/JPY million) |
0.286 (m3/JPY million) |
*1 Scope 1: GHG emissions generated directly by the Company (e.g., fuel combustion); Scope 2: GHG emissions generated indirectly by the Company (e.g., use of electricity supplied by other companies); Scope 3: GHG emissions from activities such as raw material procurement and post-sale processes
*2 Scope 1: Offsets implemented through the use of J-Credits. Scope 2: For emissions from certain overseas sites where the procurement of renewable energy is difficult, renewable energy certificates from neighboring countries are reflected. Performance is reported on a net basis, and Scope 2 is based on the market-based method.
*3 Reported figures regarding water usage at certain data centers (for FY2024) have been corrected due to the discovery of aggregation errors (January 2026).
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As part of its response to climate change, the Company promoted initiatives such as the introduction of energy-efficient facilities at its data centers and achieved the target set forth in its “2025 Carbon Neutrality Declaration” through the conversion to 100% effectively renewable energy . In addition, as part of its efforts to conserve natural capital, the Company entered into a forest management agreement aimed at water replenishment in watersheds. Major Initiatives and Achievements
Conclusion of agreements on forest 
First conclusion of VPPA
Related Initiatives |