(As of June 18, 2026)

Forward-looking statements contained herein are based on the judgments of the NEC Group as of the end of the fiscal year ended March 31, 2026.

(1) Fundamental Management Policy

The NEC Group defines the NEC Way as a common set of values that forms the basis for the conduct of the entire NEC Group.

The NEC Way consists of the “Purpose” and “Principles,” which represent why and how the NEC Group conducts business as a company, and the “Code of Values” and “Code of Conduct,” which embody the values and behaviors that all members of the NEC Group must demonstrate.


Purpose
The “Purpose” is a declaration based on the statement of “Orchestrating a brighter world” expressing NEC’s commitment to contribute to a prosperous human society.

Principles
The “Principles” are the basis for the NEC Group's actions and are comprised of three important positions.

Code of Values
The “Code of Values” are the standards of the way of thinking and acting which should be embodied by each and every individual in the NEC Group.

Code of Conduct
The “Code of Conduct” is the guidelines of integrity comprised of the following chapters that should be followed by each and every individual in the NEC Group.

To fulfill the “Purpose,” the NEC Group aims to create social value continuously and maximize its corporate value by implementing its medium- to long-term management strategies, such as including its “Mid-term Management Plan” based on the “Principles.”

Each and every individual in the NEC Group must review their own work style and organization structures based on the “Code of Values,” and identify areas for strengthening and improvement, comply with the “Code of Conduct,” and conduct themselves with high ethical standards and integrity.

The value that society and customers expect from the NEC Group is constantly changing. To remain an essential company in the eyes of society in the years to come, the NEC Group must constantly consider what constitutes value and create new value. By combining ICT with diverse knowledge and ideas, the NEC Group will work in concert with countries and communities around the world to realize bright, hope-filled lives and societies for the future.

(2) Management Indicator Goals

In order to realize the “Purpose” through maximizing its corporate value, the NEC Group sets the following indicator goals in the “Mid-term Management Plan 2030” formulated in May 2026.
From a financial perspective, the NEC Group focuses on Non-GAAP operating profit^*1 and Non-GAAP operating profit margin^*2 as target indicators for measuring underlying profitability and growth potential, and Non-GAAP earnings per share (EPS) growth rate^*3 as an indicator showing growth in profits as a source of shareholder returns. From a non-financial perspective, the NEC Group sets an engagement score as an indicator for measuring the transformation and evolution of the corporate culture, which is the foundation of sustainable growth, and aims to create an environment where each and every employee can fully demonstrate their capabilities.

(3) Business Environment

The rapid advancement of AI has brought about structural changes to industry and society that go beyond mere technological innovation, and all companies are at a historic turning point where they are required to transform on the assumption that AI will be utilized.
Furthermore, heightened geopolitical risks due to the unstable international situation are posing a serious threat to economic activities and people's safety and security in daily life, including through intensifying cyberattacks and disruptions to supply chains. As a result, strengthening the defense sector, which is responsible for national security, and critical infrastructure, which is the lifeline of society, has become a top national priority.

(4) Middle and Long Term Management Strategy and Challenges to be Addressed by the NEC Group

The rapid evolution of AI has brought about a variety of innovations in society, and the importance of security has further increased against the backdrop of shifts in international cooperation. As the world is changing dramatically, the NEC Group has formulated the “Mid-term Management Plan 2030” to deliver its strengths as social value and achieve further growth. At the same time, the NEC Group has established a vision for creating social value called “Empower Humanity - Delivering innovation and peace of mind,” which redefines its role in society in the current era. This demonstrates the NEC Group’s unwavering will to deliver innovation and peace of mind through cutting-edge technology, including AI, and to create a society where everyone can reach their full potential. The main initiatives to realize this vision are as follows.

In the IT Services Business, the value sought by customers is shifting significantly following the evolution of AI. What will be sought in the future is not the conventional system development, but upstream consulting that leads business transformation and downstream operations that are responsible for continuously creating results. The most important challenge of the NEC Group in responding to these structural changes is to materialize value using IT, data, and AI and transform its business model into one which responsibly provides that value, consistently from the formulation of strategies to implementation, operation, and maintenance. To that end, the NEC Group will accumulate expertise by using cutting-edge technology internally as “Client Zero (the first customer)” and systematize proven value as a scenario of NEC BluStellar to be proposed to customers. In addition, under NESIC Holdings, Ltd., the NEC Group will develop and enhance the end-to-end structure for providing DX solutions and strongly promote DX throughout Japan.
In the overseas IT Services Business, the NEC Group will accelerate DX business expansion in the digital government and digital finance domains by further integrating the products, customers base, and expertise of the three European subsidiaries that were acquired in recent years and the existing overseas subsidiaries in the NEC Group. In addition, effective as of April 1, 2026, the services and software business aimed at telecommunications operators, which had been included in the Social Infrastructure Business segment, was transferred to the IT Services Business segment. Based on this new structure, CSG Systems International, Inc. and Netcracker Technology Corporation, a North American subsidiary of the Company, will conduct mutually complementary business integration with the aim of strengthening the software business for telecommunications and broadband operators in North America and expanding business globally.

In the Social Infrastructure Business, it is important to secure business opportunities in the economic security domain. Under a new structure that has strengthened the cooperation among aerospace and defense, submarine cable systems, and cybersecurity, the NEC Group will enhance solutions that provide seamless protection from physical space to cyberspace. In particular, the NEC Group aims to expand its market share in submarine cable systems, which are becoming increasingly important in digital infrastructure, by utilizing its track record of laying 400,000 km - enough to circle the Earth 10 times - over the past 60 years. In the defense domain in Japan, the NEC Group will steadily reinforce resources to respond to the increase in the defense budget and pursue technological superiority in priority areas through strengthening its own R&D and cooperating with start-up companies.

Another important management challenge is improving the quality of employee engagement. As a result of the initiatives taken during the “Mid-term Management Plan 2025” period, the employee engagement score, which was only 25% in the fiscal year ended March 31, 2021, reached 48% in the fiscal year ended March 31, 2026. Although this was slightly short of the target of 50%, the top level in Japan was reached. Among the three dimensions of the engagement score of “Say, Stay, Strive” (Note) measured by the NEC Group, the NEC Group recognizes that it needs to further improve “Say” and “Strive” scores. As measures in areas highly correlated to them, the NEC Group will promote fair personnel evaluation and promotions that support job-based human resource management, optimize the compensation system with high market competitiveness, further expand the stock compensation plan, and accelerate efforts to encourage employee awareness of company-wide policies and strategies and active in-house communication.

The NEC Group will implement strategies in both the IT Services Business and the Social Infrastructure Business, and promote the implementation of AI throughout society and of technologies for security of Japan. The NEC Group aims to achieve a Non-GAAP operating profit margin of 15% or more, a Non-GAAP operating profit of 2 times (compared to the fiscal year ended March 31, 2026), and an average annual growth rate of Non-GAAP earnings per share (EPS) of 15% or more (Note) in the fiscal year ending March 31, 2031, thereby providing value to society and sustainably increasing corporate value. In addition, the NEC Group will focus on improving “Say” and “Strive,” and aim to achieve an engagement score equivalent to the top 25 percentile globally. The NEC Group will foster a corporate culture in which every employee embraces self-transformation and quickly contributes to organizational value creation.