Compliance

Basic Concept

The Solasto Group is aiming to realize its corporate philosophy of "People. Technology. Supporting comfortable living and energetic communities - To support the energetic smiles of our customers by combining the advanced expertise and superior teamwork of our employees with innovative and flexible use of technology to provide medical, elderly care, child care, and education services suited to the local communities we serve"
To achieve this, the Solasto Group Code of Conduct sets forth standards for how officers and employees of the Solasto Group should judge and act on a daily basis in aiming to be a company that contributes to the formation of a sustainable society by providing fair, honest and transparent services.
The Solasto Group aims to realize sound and high quality management based on the basic policy that each and every officer and employee of the Group shall follow the Code of Conduct and place the highest priority on compliance (observance of laws, regulations, social norms, and ethics).

Solasto Group Code of Conduct

Compliance System

Based on the basic policy for establishing an internal control system, the Solasto Group builds its compliance system with respect for laws and regulations related to the operation of the Solasts Group, as well as various laws, regulations, social norms and corporate ethics required for each business operations such as medical, elderly care, and child care services, together with the Articles of Incorporation, internal rules and regulations, the Solastso Group Code of Conduct, and basic policies.
Solasto has established the Risk & Compliance Committee as a subordinate body of the Management Committee to promote the compliance and risk management framework of the Solasto Group. The Risk & Compliance Committee reports to the Board of Directors on the contents, progress and results of its discussions and deliberations.
The Legal Affairs and Compliance Department, which is in charge of compliance management for the entire company, under the direction and supervision of the Chief Compliance Officer (COO), oversees compliance-related activities such as consolidates and manages the Group's compliance-related information, functions as the secretariat for the Risk & Compliance Committee, holds Compliance Steering Committee meetings.
The Compliance Steering Committee, which is attended by each division and the Legal Affairs and Compliance Department, develops a system for implementing the compliance program, develops measures, shares and examines compliance-related information, and issues directed by the Risk & Compliance Committee. Discussions at the Compliance Steering Committee are reported to the Risk & Compliance Committee.

Compliance employee training

The Solasto Group regularly conducts training on compliance and the Solasto Group Code of Conduct through a variety of opportunities, including training at the time of joining the Group, training by job type and business content, and e-learnings.

Whistleblower System

In order to strengthen compliance management by early detection and correction of improper events and establish a system for the proper handling of reports from employees and others regarding violations of laws and regulations, it has established and implemented a whistleblower system. In addition to the internal hotline, it also established an external hotline operated by outside attorney who is independent of the management team. Taking into account the employee composition of the Solasto Group, the external hotline is provided by an external lawyer who is experienced and female. In addition to protecting whistleblowers to ensure that they are not treated unfairly, the Company has explicitly stipulated in its internal rules the conduct of fair and impartial investigations and is working to ensure that employees are familiar with the rules. In FY2022, the number of whistleblower cases was 109.

Response to compliance-related risks

Anti-bribery

・Anti-bribery
The Solasto Group Code of Conduct prohibits bribery in purchasing, entertainment, and giving and receiving gifts, and stipulates that the Group shall not engage in any activities beyond the scope of socially accepted standards.In order to make appropriate decisions and respond to such activities as purchasing, entertainment, and gifts in accordance with related regulations, the Group has established a system to respond through the compliance contact, which is assigned to the section manager and the business division or the Legal Affairs and Compliance Department at the Headquarter.

・Political Contributions and Other Contributions

The Solasto Group Code of Conduct stipulates that it shall not engage in not only illegal political contributions but any conduct involving politics or government that may lead to collusion. The results of political contributions and donations in FY2022 are shown below.

（Millions of Yen）

Political contributions	-
Donation	0

Ensuring Compliance of Antitrust Act

On October 17, 2022, the Japan Fair Trade Commission announced that they concluded there were violations of Antitrust Act by Solasto in the bidding regarding outsourcing of medical administration of some hospitals. Solasto is taking steps to prevent a recurrence of such a situation so that it will not happen again in the future.

1)Fostering training and improving employee awareness
-Conduct trainings specialized for preventing violations of Antitrust Act mandatory for the certain level of employee every year.
-Forbid any actions that may breach the Antitrust Act and employees, employees must submit a commitment letter agreeing that it is their obligation to report to the Company if they found any actions violating the Antitrust Act by colleagues.
2) Strengthening compliance system
Took measures to raise awareness of the whistleblower system and introduced internal leniency program (a system which reduces penalties such as disciplinary measures for employees if contribute to early discovery or resolution of issues by voluntary reporting or other actions).
3) Reviewing the relationship with competitors
Introduced a rule to eliminate inappropriate contacts and communication with competitors.

Prohibitions on Involvement in Anti-Social Activities

The Solasto Group has established the Solasto Group Code of Conduct to take a firm stance toward anti-social activities and anti-social forces that threaten the order and safety of civil society, to block any and all relationships, including business relationships, and to conduct sufficient investigations into whether the other party is an anti-social force or organization in advance of transactions. The Solasto Group takes a firm stand against antisocial activities and antisocial forces that threaten the order and safety of civil society, and it has stipulated in the Solasto Group Code of Conduct the policy of severing all relationships, including business relationships, and conducting a thorough investigation prior to any transaction to determine whether the other party is an antisocial force or group. When concluding a purchase or contract, it is required to confirm the relationship with anti-social forces and organizations in accordance with the relevant regulations, and provide guidance such as incorporating anti-social clauses in contracts.

Preventing insider trading

The Solasto Group Code of Conduct stipulates that "insider information acquired in the course of business shall not be leaked or used privately" and strives to manage insider information in accordance with the Internal Transaction Management Rules, which are internal rules designed to prevent insider trading from occurring.