Corporate Governance

Corporate Governance Guidelines

1. Purpose

Sumitomo Metal Mining Co., Ltd. (the “Company”) hereby establishes this Corporate Governance Guidelines with the aim of contributing to the sustainable growth of Sumitomo Metal Mining Group, the improvement of corporate value over the medium to long term, and the strengthening and maintenance of the management base.

2. Basic Views

The Company views corporate governance as a disciplinary framework both for maximizing the corporate value of the Sumitomo Metal Mining Group and for ensuring sound management practices. As such, it is one of the most important management issues.
The Company has instituted the SMM Group Corporate Philosophy based on the Sumitomo Business Sprit and through striving to enhance our corporate governance, the Company will conduct efficient and sound business activities, make positive contributions to society, and fulfill our responsibilities to our shareholders and all other stakeholders in order to realize the Sumitomo Metal Mining Group Corporate Philosophy.

The Sumitomo Business Spirit

The Sumitomo Business Spirit has been passed down to us from the time that the Company’s business was founded and is expressed in the following words:

Article 1

Sumitomo shall achieve strength and prosperity by placing prime importance on integrity and sound management in the conduct of its business.

Article 2

Sumitomo shall manage its activities with foresight and flexibility in order to cope effectively with the changing times. Under no circumstances, however, shall it pursue easy gains or act imprudently.

SMM Group Corporate Philosophy

  • Sumitomo Metal Mining Group, in accordance with the Sumitomo Business Spirit, shall, through the performance of sound corporate activities and the promotion of sustainable co-existence with society and the global environment, seek to make positive contributions to society and to fulfill its responsibilities to its stakeholders, in order to win ever greater trust.
  • Sumitomo Metal Mining Group shall, based on respect for all individuals and recognizing each person’s dignity and value, seek to be a forward-minded and vibrant company.

3. Relationships with Stakeholders

(1) Responsibilities to Stakeholders

In order to achieve the SMM Group Corporate Philosophy, the Company will fulfill our responsibilities to eight categories of stakeholders and seek to maximize corporate value with the “ideal the Company” stated below as our goal.

Stakeholder Category Ideal the Company from the Perspective of Stakeholders
Shareholders and Investors An attractive investment as a company aiming to raise corporate value through efficient business management and sound governance while distributing a dividend commensurate with performance and disclosing information as appropriate.
Customers A company with all-round competitiveness, a sound understanding of customer needs, and advantages over competitors in terms of technology, quality, delivery, and price.
Employees A company that provides a healthy work environment where individual roles within the organization are clearly defined and employees take pride in their work.
Local Communities A company seeking to co-exist with the local community and contribute to regional growth.
Creditors A trustworthy company with strong earning power and sound finances.
Business Partners A company demonstrating considerable technological capability and integrity while placing value on trust and with which mutual prosperity can be assured.
Citizen Groups A company that engages in an appropriate level of communication, maintaining an acute awareness of its corporate responsibilities.
Governments A company that maintains total legal compliance and contributes to the growth of the countries and communities in which it operates.

(2) CSR Initiatives

In line with our CSR Policy and toward our goal of “sustainable co-existence with society and the global environment” stated in the SMM Group Corporate Philosophy, Sumitomo Metal Mining Group will actively pursue initiatives in six key areas: effective use of resources, environmental preservation, contributing to society and local communities, respect for people and human rights, occupational health and safety, and stakeholder communication.

(3) Promoting Diversity

Based on the concept of respect for all individuals set forth in the SMM Group Corporate Philosophy and in line with the SMM Group Policy on Human Rights, the SMM Group respects the diverse values of each and every employee, strives to create a work environment that allows each employee to fully demonstrate his or her abilities, and works to secure, develop, and utilize human resources.

(4) Speak Up System

Sumitomo Metal Mining Group has established a Speak Up system in which employees can report directly to points of contact inside or outside the Company in order not to allow violation of any laws, ordinances, or the Articles of Incorporation which the board of Directors, Audit & Supervisory Board Members and employees of the Company and our subsidiaries may make to be left unresolved or not to be responded to. The usage status of the Speak Up system will be reported to the full-time Audit & Supervisory Board Members and the Board of Directors pursuant to our internal regulations. Additionally, our internal regulations will clearly prohibit the disadvantageous treatment of any whistleblower using the Speak Up system due to their use thereof.

4. Ensuring Shareholder Rights

(1) Ensuring Shareholder Rights; Exercise of Rights at the General Meeting of Shareholders

The Company will take appropriate measures to substantially ensure the voting rights and all other rights of our shareholders, and we will strive to develop an environment in which shareholders can appropriately exercise their rights at the General Meeting of Shareholders.

(2) Related Party Transactions

Transactions between the Company and our Directors or Audit & Supervisory Board Members will require the prior approval of the Board of Directors so as to ensure that the interests of the Company and the common interests of our shareholders are not harmed. Additionally, the Company will survey whether or not such transactions have been carried out and report our findings to the Board of Directors semiannually.
If any transaction with a major shareholder arises, it will be handled under the same standards as transactions between the Company and our Directors. A major shareholder is one who holds 10% or more of the voting rights of the Company.

(3) Policy Regarding Reduction of Strategic Shareholdings

When advancing our business strategy, the Company may engage in strategic shareholdings with business partners or other companies if it is judged that doing so will contribute to strengthening our business base over the mid to long term. With regard to existing cross-shareholdings, the Board of Directors verifies aspects such as the objectives of holdings and whether the benefits therefrom cover the Company’s cost of capital every year. As a result of this verification, with regard to shares whose holding is judged to have little significance, including shares considered no longer worth the cost of capital and shares judged to have become less relevant due to recent business changes, we will proceed with concrete consideration based on the premise of reduction. Furthermore, in cases where a company cross-holding the Company’s shares expresses a desire to sell, we respond in a sincere manner with a view to proceeding with the sale.
With regard to the exercise of voting rights in each of such companies, the Company determines whether to vote for or against each proposal after giving comprehensive consideration, based on the financial results and other aspects of the financial condition of each of the issuing companies, to matters such as whether each proposal will contribute to increasing the corporate value of that company over the medium to long term, and what impact it will have on the Company’s corporate value. Decisions on voting are made particularly cautiously in circumstances such as cases of companies affected by major scandals or by persistent losses.

5. Governance Framework

(1) Organizational Structure

The Company has adopted Audit & Supervisory Board and Executive Officer systems to ensure effective execution, monitoring, functions within management. The Company is managed by three organs, namely (i) the Board of Directors, in charge of major decisions and supervision, (ii) President and Executive Officers, in charge of the execution of business, and (iii) the Audit & Supervisory Board Members and Accounting Auditor, in charge of auditing. In addition, the Company establish the Governance Committee to increase management transparency and strengthen corporate governance.

(2) Reasons for selection of present corporate governance system

In line with its Corporate Governance Basic Policy, which summarizes the Company’s basic philosophy for corporate governance and the framework therefor, the Company believes that its governance is a system that ensures that business execution and the associated monitoring and supervision are each functioning fully by using Audit and Supervisory Board and executive officer systems with which to conduct governance through a three-part organizational structure in which decision-making and supervision is addressed by the Board of Directors, business execution by the president and the executive officers, and auditing by the Audit & Supervisory Board members and the accounting auditor.
Positioning Mineral Resources, Smelting & Refining, and Materials as its three core businesses, the Company aims to realize its Long-term Vision of becoming a “World Leader in the Non-Ferrous Metals Industry.” Since all three businesses are related to non-ferrous metals, they have a mutual organic relationship and their business contents and scale are such that the Board of Directors can make decisions itself regarding diverse management issues. Furthermore, from the viewpoint of the stronger coordination currently being promoted among the three businesses, it will further stimulate the Company’s growth if the Board of Directors itself comprehensively makes decisions rather than giving strong independence to each business segment and permitting them to make their own decisions. To this end, we consider that in principle a management model would be appropriate for the Company’s governance, rather than a monitoring model that oversees overall business execution after the fact.
Furthermore, in view of the distinctive characteristics of the Sumitomo Metal Mining Group’s business operations, it is important to strengthen the management infrastructure (particularly regarding compliance, safety, and the environment) and therefore necessary to establish a system whereby auditors can point out issues to directors and executive officers without hesitation. From this viewpoint, we have adopted an organizational structure of a company with an Audit & Supervisory Board in which auditors with guaranteed independent authority can be expected to exercise their auditing functions stably over a period of four years. At present auditors do not have the right of convocation regarding decisions of the Board of Directors or the right to vote on the Board of Directors. The resulting inability of auditors to propose the removal of a director to the Board of Directors is an issue for companies with an Audit & Supervisory Board. We are striving to overcome this issue by appointing multiple outside directors (at least one third of members), have them become members of the Governance Committee, and deal with the appointment and dismissal of directors and executive directors in the Governance Committee.

6. Major decisions and Supervision

(1) Board of Directors

1. Functions of the Board of Directors

The Board of Directors will conduct decision-making regarding the matters prescribed in the Companies Act and other material business execution, and it will ensure managerial fairness and transparency by fulfilling its function of supervising overall management, including the performance of the duties of the Representative Directors and the Executive Officers.

2. Composition of the Board of Directors

The Board of Directors will achieve a diverse composition by including both members from within the Company who are thoroughly familiar with each area of the Company’s business as well as outside experts with knowledge, experience, abilities, and insight different from that of the members from within the Company. The size of the Board of Directors will be appropriate to conducting active discussions and ensuring the briskness of the Board. One third or more of the Directors will be Independent Outside Directors in order to strive for greater managerial transparency.

3. Operations of the Board of Directors

a. Meetings of the Board of Directors

In addition to regular meetings of the Board of Directors held once each month, the Board will hold extraordinary meetings whenever necessary, thereby maintaining a structure that can perform agile decision-making.
In order to allow for sufficient discussion necessary for determining material business execution and overseeing the performance of duties, the agenda and deliberation time of Board of Directors meetings will be set appropriately, and an agenda list and materials for deliberation will, in principle, be provided to the Directors and Audit & Supervisory Board Members at least two business days prior to the day of the meeting.

b. Resolutions of the Board of Directors

Unless otherwise provided for in laws, ordinances, or the Articles of Incorporation, resolutions of the Board of Directors will require (a) the attendance of a majority of the Directors able to participate in the vote and (b) a majority of those attending Directors.

4. Evaluation of effectiveness of the Board of Directors

In consideration of appropriate determination of business execution and monitoring functions, the Board of Directors will analyze and evaluate its effectiveness every year taking an external evaluation into account and will publish a summary of the results of that analysis and evaluation.

(2) Governance Committee

The Company has established the Governance Committee in order to increase the transparency of management and strengthen corporate governance. The Governance Committee will be comprised of the Chairman, who is not an Executive Officer, and the Independent Outside Directors (if there is no Chairman, then only the Independent Outside Directors) and will advise the President from an objective standpoint regarding material matters of corporate governance, such as the nomination and compensation of Directors and Executive Officers.

1. Nomination and Dismissal Policies and Determination Procedures

With regard to the selection of executive officer candidates, the president, based on the recommendations of the executive officers, comprehensively considers the knowledge, experience, abilities and insight of the candidates and, after receiving advice from the Governance Committee regarding the best lineup to solve the issues management faces, proposes the candidates to the Board of Directors, which makes the final decision after due deliberation.
The policy when nominating director candidates is for the President to comprehensively consider the knowledge, experience, abilities, and insight of the candidates, after which the final decision is made through the same procedures as above. The Governance Committee has opportunities to deliberate on the environment and methods for fostering the next president as well as concerning the candidates, etc. In the event that an executive officer has rendered him or herself markedly ineligible, for example by having acted unlawfully, improperly, or disloyally, and a dismissal recommendation is made to the Board of Directors after the Governance Committee gives advice on the matter, the individual concerned may be dismissed by resolution of the Board of Directors.
With regard to the nomination of Audit & Supervisory Board member candidates, the policy is for the President to comprehensively consider the qualifications, knowledge (including that of finance, accounting, and law), experience, abilities, and insight of the candidates and, after obtaining the prior approval of the Audit & Supervisory Board, to propose the qualified candidates to the Board of Directors, which will then determine the nominations.
Reasons for the nomination of Director (including directors who are executive officers) candidates and Audit & Supervisory Board Member candidates will be stated in the reference materials of the General Meeting of Shareholders.

2. Remuneration Policies

The policy regarding the determination of remuneration, etc. of individual directors (including directors who concurrently serve as Executive Officers) is as follows.

a. Basic Policy

Remuneration for of the Company is linked to the business performance of the Company, and designed to motivate Directors to achieve mid to long-term goals, based on the business structure of the Company, so that it functions as a sufficient incentive to contribute to sustainable growth, increase the corporate value of the Group over the mid to long term, and to strengthen and maintain the management base. When determining the remuneration of individual Directors, the amount of remuneration is calculated using a predetermined formula in order to ensure fairness, and the Company maintains a basic policy of setting remuneration at an appropriate level based on the responsibilities of each Director.
Specifically, the remuneration for Directors (excluding Outside Directors) shall consist of base remuneration and bonuses. Basic remuneration shall consist of fixed remuneration (remuneration which is neither performance-based nor non-monetary) and performance-based remuneration, etc., while bonuses shall be performance-based remuneration, etc. Outside Directors shall receive only basic remuneration and no bonuses.
Basic remuneration is calculated on an annual basis for each individual and paid each month in monthly installments, while bonuses are paid once annually after approval is obtained at the ordinary general meeting of shareholders.

b. Basic Remuneration

a) Policy on determination of remuneration, etc. for the President and Director
Basic remuneration for the President and Director is composed of fixed remuneration and performance-based remuneration.
The amount of fixed remuneration will be set at a specified standard amount, referencing the remuneration trends of domestic companies in the same industry and domestic manufacturing companies of the same size as the Company, and will be adjusted to a certain extent each year based on employee wage trends.
As an evaluation of corporate management performance, performance-based remuneration, etc., is paid as an amount calculated in accordance with the degree of achievement of targets for net income attributable to owners of the parent and safety during the previous fiscal year.

b) Policy on determination of remuneration, etc. for the Chairman of the Board
Basic remuneration for the Chairman of the Board shall be the base amount of the basic remuneration for the President and Director, multiplied by a predetermined position-specific coefficient.

c) Policy on determination of remuneration, etc. for Outside Directors
Basic remuneration for Outside Directors shall be the base amount of the basic remuneration for the President and Director, multiplied by a position-specific coefficient.

d) Policy on determination of remuneration, etc. for Directors who concurrently serve as Executive Officers with special titles (Executive Vice President, Senior Managing Executive Officers, Managing Executive Officers)
Basic remuneration for directors who concurrently serve as executive officers with special titles is determined based on the basic remuneration of the President and Director, and takes into account job responsibilities, departmental performance, and individual performance evaluations.
Representative Directors who concurrently serve as Vice President or Senior Managing Executive Officers and Directors who concurrently serve as Managing Executive Officers shall be paid fixed remuneration predetermined in consideration of their positions and responsibilities in addition to the basic remunerationabove.

e) Policy on determination of remuneration, etc., for Directors who concurrently serve as Executive Officers (excluding Executive Officers with special titles)
Basic remuneration for Directors who concurrently serve as Executive Officers shall be composed entirely of fixed remuneration predetermined in consideration of their job responsibilities and other factors. However, the basic remuneration for their role as an executive officer shall be paid separately as an employee salary.

c. Bonuses

Bonuses for Directors shall be paid to Directors, excluding Outside Directors, as a reward for their performance in the corresponding fiscal year, and shall be proposed and deliberated at the ordinary general meeting of shareholders for the corresponding fiscal year in the case that net income attributable to owners of the parent exceeds a certain amount.
The bonus amount for the President and Director shall be calculated according to the degree of achievement of the target for net income attributable to owners of the parent for the corresponding fiscal year, and this shall represent the base amount. The bonus amount for the Chairman of the Board and the Directors who concurrently serve as Executive Officers shall be calculated by multiplying the base amount for the President and Director by a position-specific coefficient, etc., in the same manner as the base remuneration described in b. above, and this shall represent the total amount.
The specific amount paid to each individual will be determined by reflecting the individual performance evaluation of each Director.

d. Policy on determination of ratio of fixed remuneration and performance-based remuneration, etc.

The ratio of fixed remuneration and performance-based remuneration, etc. for each director is determined according to the calculation method for each of the above remuneration types. However, the ratio of remuneration is determined in a manner that provides an appropriate incentive to increase corporate value based on consultation and advice from the Governance Committee, which is composed of the Chairman of the Board, who does not concurrently serve as an Executive Officer, and Independent Outside Directors.
In the case that net income attributable to owners of the parent does not reach the specified level, bonuses will not be paid.

e. Delegation of decisions regarding details of individual remuneration, etc. of Directors to third parties

The President and Representative Director shall be delegated the authority to determine specific details of individual remuneration based on a corresponding resolution by the Board of Directors, and the authority granted shall be the determination of the amount of basic remuneration and bonuses for Directors. Regarding the specific procedure involved, the President and Representative Director, who has been delegated authority by the Board of Directors, shall determine the specific amount of remuneration for each director after consulting the Governance Committee and obtaining its advice. When finalizing remuneration, the Secretary Office shall prepare a request for approval, which shall be approved by the President and Representative Director.
Results are reviewed by the Chairman of the Board, who is a member of the Governance Committee, as well as by Audit & Supervisory Board members.

3. Specific Determination Procedures for Audit & Supervisory Board Member Compensation

The amount of compensation for each individual Audit & Supervisory Board Member will be determined by consultation among the Audit & Supervisory Board Members at the Audit & Supervisory Board within the total compensation amount approved by the General Meeting of Shareholders.

(3) Outside Directors and Audit & Supervisory Board Member

1. Role and function of outside directors

Outside directors are expected to perform two functions: an advisory function and a monitoring function.
Regarding the advisory function, in order for the Company to achieve sustainable growth and increase its corporate value over the mid- to long -term, outside directors are expected to enhance the quality of decision-making by the Board of Directors by providing advice and makeing decisionjudgments based on their experience and other factors, without being bound by the Company's conventional way of thinking or frameworks.
Regarding the monitoring function, outside directors are expected to serve a check function on management from an independent and objective standpoint via the Board of Directors, as well as to supervise management on behalf of shareholders and other stakeholders by providing advice during decision-making on director nomination, remuneration compensatio n, and other relevant matters as members of the Governance Committee.

2. Role and function of outside Audit & Supervisory Board Members

In order for the Company to achieve sound management and increase its corporate value over the mid- to long -term, outside Audit & Supervisory Board Members are expected to conduct effective audits based on their knowledge and experience in specialized fields including finance, accounting, and legal matters, while maintaining sufficient coordination with Standing Audit & Supervisory Board Members belonging the Company.
In addition, as part of the audit process, outside Audit & Supervisory Board Members are expected to participate in key meetings, including Board of Directors meetings, and to actively express their forthright opinions from an independent and objective standpoint during the decision-making process, including not only the legality but also the appropriateness of proposals.

3. Independence Standards

The Company will follow the requirements for externality prescribed in the Companies Act and the independence standards prescribed by Tokyo Stock Exchange, Inc. in judging the independence of Outside Directors and Outside members of Audit & Supervisory Board (collectively, “Outside Officers”). However, even if an Outside Officer belongs to a business partner of the Company or in other such situations, the Outside Officer will, in principle, be judged to be independent when falling under the following immateriality standards prescribed by the Company.

Business Partners and Banks
  • In the most recent business year, sales of the Company (non-consolidated) to the business partner (non-consolidated) were less than 2% of the sales of the Company (non-consolidated).
  • In the most recent business year, sales of the business partner (non-consolidated) to the Company (non-consolidated) were less than 2% of the sales of the business partner (non-consolidated).
  • In the most recent business year, the outstanding balance of loans from the business partner to the Company (non-consolidated) was less than 2% of the total assets of the Company (non-consolidated).
Consultants, Experts, etc.
  • Consultants, accounting experts, legal experts, or other such experts who received money or other such assets (if the recipient of such assets is a corporation, partnership, or other such organization, then any person belonging thereto), other than officer compensation, of less than an annual amount of 10 million yen in the most recent business year from the Company (non-consolidated).
Contributions, etc.
  • If the recipient is an individual Director or Audit & Supervisory Board Members: The amount of money or other such assets received from the Company (non-consolidated) in the most recent business year is less than an annual amount of 1 million yen.
  • If the recipient is a corporation, etc. to which a Director or Audit & Supervisory Board Member belongs (in case of national university corporations, incorporated educational institutions, or the like, the department or post-graduate course to which the Director or Audit & Supervisory Board Member belongs will be deemed to a recipient): The amount of money or other such assets received from the Company (non-consolidated) in the most recent business year is less than an annual amount of 10 million yen.

4. Support Framework for Outside Officers

The Company will provide the following support necessary for Outside Officers to effectively fulfill their roles and responsibilities.

a. The Company will conduct explanations for Outside Officers in advance regarding the agenda of Board of Directors meetings in order to improve deliberations thereat.

b. The Company will provide opportunities for Outside Officers to visit the Company Group business sites in order to gain a deeper understanding of the Company’s business. the Company will select themes in which Outside Officers are interested, such as large-scale projects, and provide opportunities to receive explanations thereon.

c. In order to share information and reflect the objective views of external parties in management, the Company will provide support for holding meetings composed solely of Outside Officers and meetings at which Outside Officers and top management can directly exchange opinions.

(4) Policy on Training, etc. for Directors and Audit & Supervisory Board Members

The training of directors and Audit & Supervisory Board members is based on the self-improvement of each individual, and therefore THE COMPANY contributes to self-improvement by providing opportunities for training either directly or as an intermediary and provides support for the costs thereof.

7. Execution of business

(1) Delegation of Authority from the Board of Directors

In accordance with laws, ordinances, and the Articles of Incorporation, the Board of Directors will entrust the determination of business execution to the President and the Executive Officers and supervise the status of the performance of their duties.

(2) System of Internal Memorandums for Approval and the Management Committee

The basic method for conducting decision-making regarding business execution will be to examine and approve such matters through the system of internal approval procedures, and the Management Committee will hold meetings for material matters regarding management that require deliberation, thereby conducting careful decision-making and rational business judgment based on diverse perspectives.
The Management Committee will be composed of the President, Vice President, Senior Managing Executive Officers, and other Executive Officers concerned, and the Chairman, Outside Directors, and Audit & Supervisory Board Members will be allowed to attend Management Committee meetings, as well. The Management Committee will deliberate from a broad perspective on matters to be resolved by the Board of Directors and matters to be approved by the President, determine whether matters will be referred to the Board of Directors, and fulfill the function of supporting approval granted by the President.

(3) CSR Committee

The Company has established the CSR Committee chaired by the President in order to promote the CSR activities of the Sumitomo Metal Mining Group. Within the CSR Committee, three working groups in charge of compliance, risk management, and quality assurance have been established along with six subcommittees pursuing initiatives in each of the six key areas of our CSR activities.

(4) Internal Controls Committee

The Company has established the Internal Controls Committee chaired by the President in order to create, maintain, and improve internal control systems within the Sumitomo Metal Mining Group.

(5) Corporate Value Enhancement Committee

The Company has established the Corporate Value Enhancement Committee with the goal of realizing the sustainable growth of our business and the increase of our corporate value.

(6) Establishment of Compliance Framework

Not only will the Sumitomo Metal Mining Group comply with laws, ordinances, the Articles of Incorporation, and our own rules, but we will also fulfill our moral and social responsibilities required as a member of society through sound business activities. Additionally, in order to stop compliance breaches within the Sumitomo Metal Mining Group at an early stage, every instance of a breach of which the Company becomes aware will, in principle, be reported to the Board of Directors, and the Board of Directors will review whether the compliance framework is appropriately constructed and effectively operating.

8. Auditing

(1) Auditing Framework

At least half of the Audit & Supervisory Board Members will be Outside Audit & Supervisory Board Members with a variety of expertise and diverse perspectives. Audit & Supervisory Board Members from within the Company will conduct audits based on the particular characteristics of full-time Members, such as by collecting information within the Company, and Outside Audit & Supervisory Board Members will conduct audits that make use of their areas of expertise. Audit & Supervisory Board Members will collaborate with the Internal Audit Department and the Accounting Auditor to conduct audits to ensure that management is transparent, fair, and legally compliant.

(2)Audits by Audit & Supervisory Board Members

In order to ensure managerial soundness and increase the corporate value of the Company, and in accordance with the audit policies, audit plans, and other such matters prescribed by the Audit & Supervisory Board, each Audit & Supervisory Board Member will attend meetings of the Board of Directors and other important meetings, receive reports and, when necessary, request explanations from Directors, Executive Officers, and employees regarding the status of the performance of their duties, inspect material approval documents and other such documents, and examine the status of operations and assets at the head office and other major business sites. Additionally, each Audit & Supervisory Board Member will exchange information with the other Audit & Supervisory Board Members and the Accounting Auditor as appropriate.

9. Dialogue with Shareholders; Information Disclosure

The Company believes that receiving the understanding and support of all of our shareholders and investors is essential for the sustainable growth and increased corporate value of the Company over the mid to long term. Therefore, in consideration of increasing corporate value over the mid to long term, the Company will develop the following IR activities to achieve dialogue with our shareholders and investors in order to receive a deeper understanding of the Company.

  1. The President will coordinate dialogue with shareholders and investors and information disclosure, and the Executive Officer supervising the Public Relations & Investor Relations Department will be the officer in charge of such dialogue and disclosure.
  2. The officer responsible for information disclosure (the General Manager of the Public Relations & Investor Relations Department) will decide whether or not information should be disclosed.
  3. When preparing materials for disclosure, the Public Relations & Investor Relations Department will collaborate with the relevant divisions and conduct disclosure appropriately and in a fair and timely manner.
  4. The Company will implement measures to receive deeper understanding of our business, such as holding briefings conducted by the President for institutional investors and securities analysts regarding financial results and business strategies as well as holding briefings for individual investors. Additionally, the Company will establish a section on our website for individual investors and will endeavor to disclose IR information in a manner that is easy to understand.
  5. The Company will regularly report the views and requests learned through communication with our shareholders and investors to management and make use of those views and requests in managing the Company.
  6. In order to prevent divulgence of any information that could influence share prices during the preparation period of financial results announcements and to ensure fairness, the Company will establish an about two-week “quiet period” prior to the announcement of quarterly and full-year financial results and refrain from commenting or answering questions on those results during that period. Additionally, matters regarding information disclosure will be stated on internal memorandums for approval to verify the management of information., The responsible division will also thoroughly ensure that, during dialogue with shareholders and investors, no insider information is disclosed and no selective disclosure of nonpublic material information is made in accordance with the fair disclosure rule. Furthermore, if it becomes known that selective disclosure of nonpublic material information has occurred, the said information shall be publicized promptly in principle.

End