The Dentsu Group places high priority on the establishment of a business management system that can respond rapidly to changes in the business environment and that emphasizes compliance.

Dentsu is operated under the corporate auditor system. The Company has been considering forms of corporate governance easily explainable to shareholders, investors and others and has considered the U.S.-style committee system. There is, however, no current plan for adoption thereof. This is because the current corporate governance system remains satisfactory with respect to both rapid decision-making and effective internal controls.

Dentsu's Board of Directors meets once a month, in principle, to resolve important matters and to receive updates on business status. A meeting of full-time Directors is held twice a month, in principle, to decide important matters not covered by the Board of Directors, as well as to deliberate on matters prior to their resolution by the Board. The Board of Directors and the meeting of full-time Directors also appoint members to various committees that have been formed to discuss and decide on routine business matters. The Board of Corporate Auditors meets once a month, in principle, to set auditing policies and allocate auditing responsibilities, as well as to examine the performance of the Board of Directors in line with auditing regulations.

The Board of Corporate Auditors conducts audits focusing especially on internal control systems, compliance, risk management systems and other areas of the Dentsu Group as a whole. To support the duties of the corporate auditors, the Corporate Auditors Office has been established, with 5 employees assigned. Separately from this, the Internal Audit Division, consisting of 19 employees, conducts internal audits. Such internal audits, conducted based on the annual audit schedule, are carried out for the Dentsu Head Office and each of the Branch Offices, as well as all domestic and overseas subsidiaries. With respect to the mutual cooperation among Corporate Auditors, the Internal Audit Division and outside auditors, appropriate reports on audit methods and results are requested at the meetings of the Board of Corporate Auditors and Senior Corporate Auditors periodically exchange information on an individual basis. Dentsu has established a Group Companies Auditors Office, and dispatches Corporate Auditors to key Group companies.

Dentsu has an auditing agreement with Deloitte Touche Tohmatsu under which audits are conducted. No special interests exist between Dentsu and Deloitte Touche Tohmatsu or the personnel thereof who handle the audits of Dentsu.

Dentsu has appointed outside members to its Board of Directors and Board of Corporate Auditors. As of July 1, 2007, two of the 16 members of the Board of Directors and three of the five members of the Board of Corporate Auditors were outside members. As of July 1, 2007, the two outside members of the Board of Directors and two out of the three outside members of the Board of Corporate Auditors served as directors, corporate auditors or administrative officers of companies having business relationships with Dentsu. None of such outside members of the Board of Directors or the Board of Corporate Auditors, however, have been employees of Dentsu or any of its Group companies.

Under an amendment to its articles of incorporation adopted at the General Meeting of Shareholders held in June 2004, Dentsu reduced the term of office of its members of the Board of Directors from two years to one year. This amendment made possible the establishment of a more flexible structure, and further clarified the responsibilities of the members of the Board of Directors.

With the aim of realizing integrated risk management and promoting compliance, in February 2004 Dentsu established a Corporate Ethics Committee to make decisions on Dentsu's activity guidelines and specific actions. The committee meets once a month, in principle, and addresses such matters as the formulation of the Dentsu Group Charter of Corporate Conduct, and the creation, management, and improvement of internal control systems.

The Dentsu Group Charter of Corporate Conduct constitutes a standard of business conduct applicable to the Dentsu Group in pursuing its social responsibilities, and it addresses matters such as compliance with laws and establishment of corporate ethics, timely and proper disclosure of corporate information, appropriate perspectives in promoting business activities and appropriate perspectives with respect to the relationship between society and the Dentsu Group employees.

As of March 2006, Dentsu and 52 companies in the Dentsu Group had acquired group certifications for BS7799, an international standard for information security, and for the ISMS (Information Security Management Systems) standard, a Japanese certification. We will continue to enhance our information security measures by obtaining such certifications, in order to convert to the International Standards Organization's ISO27001 certification.

Dentsu considers the promotion of corporate social responsibility (CSR) to be a series of voluntary measures intended to attach the "creation of new value" to economic, environmental and social issues. These include social contributions, environmental preservation, support for human rights, occupational safety and health, and compliance, and take the position of all stakeholders into consideration. We also seek through the practice of CSR to establish trust, increase competitiveness, and achieve sustainable growth, as well as contribute to better social development and stimulation of the economy. We will continue to pursue previous initiatives, including the UNESCO World Terakoya Movement/KURURIMPA Project, the Mt. Fuji Environmental Protection Support Project, and the NPO Communication Support Project. In terms of environmental initiatives, Dentsu expanded ISO14001 certification, pursued as part of its environmental program, to include 49 group companies.

As of July 2 , 2007