Note: This document has been translated from the Japanese original for reference purposes only. In the event of any
discrepancy between this translation and the Japanese original, the Japanese original shall prevail.
J. FRONT RETAILING Co., Ltd. assumes no responsibility for this translation or for direct, indirect or any otherforms of damages arising from the translation.

Securities code: 3086
May 2, 2022
To Our Shareholders

YOSHIMOTO Tatsuya
Director, President and Representative
Executive Officer
J. FRONT RETAILING Co., Ltd.
10-1, Ginza 6-chome, Chuo-ku, Tokyo

Notice of Convocation of the 15th Annual Shareholders Meeting
You are hereby notified that the 15th Annual Shareholders Meeting of J. FRONT RETAILING Co., Ltd.
(hereinafter the “Company”) will be held on Thursday, May 26, 2022.
There will be discussion of the current status of the Company’s business and related issues, and the
proposal to be presented at the Shareholders Meeting will be explained.
We look forward to the continued understanding and support of all our shareholders.
Date and Time:
Venue:

Thursday, May 26, 2022, at 10:00 a.m. (JST) (Reception opens at 9:30 a.m.)
New Pier Hall
11-1, Kaigan 1-chome, Minato-ku, Tokyo

Purpose of the meeting:
Matters to be reported: 1. Business Report, Consolidated Financial Statements, and Non-consolidated
Financial Statements for the 15th fiscal year (from March 1, 2021 to February
28, 2022)
2. Audit reports of the Accounting Auditor and the Audit Committee on
Consolidated Financial Statements for the 15th fiscal year
Matters to be resolved: Proposal 1: Amendment to the Articles of Incorporation
Proposal 2: Election of Ten (10) Directors
Decisions made for convocation:
Please refer to Guide to the Exercise of Voting Rights on pages 3 to 4.

* Please note that persons who are not shareholders who can exercise voting rights, such as proxies who are notshareholders, and accompanying persons, will not be admitted. (The accompanying persons of shareholders
with disabilities are exempt and will be admitted.)
However, institutional investors who hold shares in the names of trust banks, etc. and do not hold shares in theirown names will be admitted, on condition that they fulfilled the requirements and procedures provided for in
the Company’s Articles of Incorporation and Share Handling Regulations.

-1-



Of the documents attached to Notice of Convocation of the Annual Shareholders Meeting, Systems toensure properness of operations <Basic Policy to Build Internal Control System>* in the Business
Report, Notes to Consolidated Financial Statements and Notes to Non-consolidated Financial
Statements are provided on the Company’s website in accordance with relevant laws and regulations
and Article 16 of the Company’s Articles of Incorporation, hence are not indicated on this Notice ofConvocation.
* “Operational status of systems to ensure properness of operations <Basic Policy to Build Internal Control
Systems>” is included on this Notice of Convocation.

Business Report, which has been audited by the Audit Committee, and Consolidated Financial
Statements and Non-consolidated Financial Statements, which have been audited by the Audit
Committee and the Accounting Auditor, shall include not only the documents stated in this Notice ofConvocation, but also Systems to ensure properness of operations <Basic Policy to Build Internal
Control System>, Notes to Consolidated Financial Statements and Notes to Non-consolidated
Financial Statements, which are provided on the Company’s website.
If any amendments to Reference Materials for Shareholders Meeting, Business Report, Consolidated
Financial Statements or Non-consolidated Financial Statements are made, the revised version will be
provided on the Company’s website.
The Company’s website: https://www.j-front-retailing.com/

In view of the situation of the novel coronavirus disease (COVID-19), and with the safety of our shareholders
as our top priority, we strongly request that shareholders refrain from attending the Annual Shareholders
Meeting in person this year as much as possible and exercise voting rights via either postal mail or the Internet
in advance.
Please refer to page 3 for details on how to exercise voting rights in advance.
Exercise due date of your voting rights: Received by 6:00 p.m. on Wednesday, May 25, 2022 (JST)We will conduct the “live streaming of the meeting via Internet” on the day of the meeting.
▶Please refer to pages 5 to 6 for details.

-2-Guide to the Exercise of Voting Rights
Exercising voting rights via the Internet
Please read the following items before exercising voting rights via the Internet.
Exercise due date: Received by 6:00 p.m. on Wednesday, May 25, 2022 (JST)(Instructions concerning the exercise of voting rights via the Internet)
How to scan QR code
You can log in to the voting website without entering your login ID and temporary password printed on thevoting form.
1. Scan QR code printed on the voting form (at right).
*“QR code” is a registered trademark of DENSO WAVE INCORPORATED.
2. Follow the directions that appear on the screen to input approval or disapproval to each proposal.
The QR code can be used for login only one time.
If you need to exercise your voting rights again or exercise your voting rights without using the QR code,see “How to enter login ID and temporary password.”
How to enter login ID and temporary password
Voting website: https://evote.tr.mufg.jp/
Access the voting website.
Enter the “Login ID” and the “Temporary password” shown on the voting form and click the “Login” button.
Set a new password.
Follow the directions that appear on the screen to input approval or disapproval to each proposal.
Handling of cases where voting rights are exercised in duplicate by the same shareholder both inwriting and by an electromagnetic means
The voting rights exercised by an electromagnetic means shall be treated as valid. If the same shareholder
exercises his/her voting rights by an electromagnetic means more than once, only the last exercise of voting
rights shall be treated as valid.
For inquiries about the system, please contact:
Corporate Agency Division (Help Desk)
Mitsubishi UFJ Trust and Banking Corporation(Toll free) 0120-173-027(available 9:00 a.m. – 9:00 p.m., only in Japan)
To institutional investors
To exercise voting rights at this meeting, institutional investors can use the electronic voting rights exercise
platform for institutional investors operated by ICJ, Inc.
Exercising voting rights by postal mailPlease indicate on the enclosed voting form whether you approve or disapprove of the proposal, and returnthe completed form to us.
Exercise due date: Received by 6:00 p.m. on Wednesday, May 25, 2022 (JST)
Attending the Shareholders Meeting in person
Please submit the enclosed voting form at the reception of the meeting.
In view of the situation of the novel coronavirus disease (COVID-19), and with the safety of ourshareholders as our top priority, we strongly request that shareholders refrain from attending the Annual
Shareholders Meeting in person this year as much as possible.

-3-Measures to prevent COVID-19 infectionPlease make sure to wear a mask to protect yourself and others from COVID-19.
(You may be refused entry if you do not wear one.)
We ask for your cooperation in disinfecting your hands with alcohol and taking your temperature at
the entrance of the venue.
Please note that we may ask you to refrain from entering the venue if the temperature check showsthat you have a fever of more than 37.5 degrees Celsius or if you look unwell.
The Company’s officers and staff will wear a mask and respond at the venue after checking their
physical condition.

-4-

Guide to live streaming of the meeting via Internet
The Annual Shareholders Meeting will be live streamed via the Internet for you to view the proceedings ofthe meeting at home or other locations.
1.

Date and time of the live streaming

From 10:00 a.m. on Thursday, May 26, 2022 to the closing time of the Annual Shareholders
Meeting*A live streaming web page is available from around 9:30 a.m., approximately 30 minutes before thestart time of the Annual Shareholders Meeting.
2. How to view the live streaming
Access the “Engagement Portal” online site for the Annual Shareholders Meeting below with your “Login
ID” and “Password” indicated on the voting form.
“Engagement Portal” online site for the Annual Shareholders Meeting: https://engagement-portal.tr.mufg.jp/(i)Login ID: 0007+Shareholder Number (12-digit number without a hyphen) shown on the voting form,
etc.
(ii) Password: Postal code+2022 of the address registered in the shareholders’ register as of the end of
February 28, 2022 (11-digit number without a hyphen)
1.

Enter your “Login ID” and “Password” on the login screen, confirm the Terms of Use and check the“I agree to the Terms of Use” checkbox if you agree, then click the “Login” button.
2. After logging in, click the “View Live Streaming of the Meeting” button, confirm the Terms of Useand check the “I agree to the Terms of Use” checkbox if you agree, then click “View.”*Please be sure to take a note of your Login ID and Password before posting your voting form. If you
forget your ID and/or password, please contact us at the contact number listed below “Contact information
for inquiries about the Annual Shareholders Meeting online site” on page 6.
(Note)The postal code used for (ii) “Password (Postal code+2022)” may differ from the postal code printed on thevoting form (because the password does not reflect information such as on change of address made after
the record date of the Annual Shareholders Meeting or on mailing address designated for the voting form
to be sent). Shareholders residing outside Japan who have designated a standing proxy are requested toenter the postal code of the proxy.
3. Important notice(1) Due to unavoidable circumstances, we might be unable to provide the live streaming. In that case, a
notice will be posted on the Company’s website (https://www.j-front-retailing.com/).
(2) Shareholders viewing the live streaming are not considered to be attending the Annual
Shareholders Meeting under the Companies Act, and therefore, will not be able to exercise theirvoting rights or make any comments, including questions on the day. Please exercise your voting
rights in advance by following the instructions on page 3 on this Notice of Convocation.
(3) Please note that viewing will be restricted to shareholders only and viewing by proxies is not permitted.
(4) It is strictly prohibited to capture, record audio or video of, or save the live streaming, or to publish it on
SNS or other media.
(5) Please note that due to the Internet communication environment and other factors, the video and audio
may be distorted, or the streaming may be interrupted.
(6) The live streaming may not be viewable depending on the device used or the network environment
connected.
(7) Fees for accessing the website for viewing (Internet access fees, communication fees, etc.) shall be borneby the shareholder.
* “QR code” is a registered trademark of DENSO WAVE INCORPORATED.

-5-

Questions will be accepted in advance via the Internet
We will accept questions from shareholders in advance on the Annual Shareholders Meeting online
site.
We plan to answer questions frequently asked by shareholders at the Annual Shareholders Meeting.
Please note that we do not respond to individual inquiries.
(i) Please click the “Question in advance” button displayed on the screen after logging in to theAnnual Shareholders Meeting online site.
(ii) Select a category for your question, enter the question, confirm the Terms of Use and check the“I agree to the Terms of Use” checkbox if you agree, then click the “Confirm” button.
(iii) Confirm the contents of your question, etc., and then click the “Send” button.
Due date for receipt of questions:by 6:00 p.m. on Thursday, May 19, 2022

(Contact information for inquiries about the Annual Shareholders Meeting online site)
Mitsubishi UFJ Trust and Banking Corporation
Dedicated support line for the “Engagement Portal”
Service period

Tel: 0120-676-808 (Toll free)

From 9:00 a.m. to 5:00 p.m. on weekdays, excluding Saturdays, Sundays, national holidays, etc.
(However, on the day of the Annual Shareholders Meeting, from 9:00 a.m. to the end of the Meeting)-6-Reference Materials for Shareholders Meeting
Proposal and Reference Information
Proposal 1: Amendment to the Articles of Incorporation
1. Reason for proposal
Since the revised provisions provided for in the proviso to Article 1 of the Supplementary Provisions of
the Act Partially Amending the Companies Act (Act No. 70 of 2019) are to be enforced on September 1, 2022,
the Company proposes to make the changes to its Articles of Incorporation as described in the following (1)to (4) in preparation for the introduction of the system for providing informational materials for theshareholders meeting in electronic format.
(1) Article 16, paragraph 1 in “Proposed amendments” below will stipulate that the Company shall takemeasures for providing information that constitutes the content of reference materials for shareholders
meeting, etc. in electronic format.
(2) Article 16, paragraph 2 in “Proposed amendments” below will establish the provision to limit the scopeof the items to be stated in the paper-based documents to be delivered to shareholders who requested thedelivery of paper-based documents.
(3) Since the provisions for Internet Disclosure of Reference Materials for Shareholders Meetings andDeemed Provision (Article 16 of the current Articles of Incorporation) will no longer be required, they
will be deleted.
(4) Accompanying the aforementioned establishment and deletion of provisions, supplementary provisions
regarding the effective date, etc. will be established.
With the aim to further strengthen the oversight function through separation from business execution, thenumber of Directors stipulated in Article 19 of the current Articles of Incorporation will be reduced from“fifteen (15) or fewer” to “eleven (11) or fewer” to optimize the number of Directors.
Furthermore, in conjunction with the end of the transitional measure, the provision of Transitional Measure
Relating to Advisor (Article 2 of the Supplementary Provisions of the current Articles of Incorporation) will
be deleted.
2. Details of amendment
The details of the amendment are as described below.
(Amendments are underlined.)
Current Articles of Incorporation

Proposed amendments

Article 16 (Internet Disclosure of Reference Materials for(Deleted)
Shareholders Meetings and Deemed Provision)
Upon convocation of a Shareholders Meeting, theCompany may be deemed to have provided the information
relating to the matters to be described or indicated in thereference materials for the shareholders meetings, business
report, non-consolidated financial statements or
consolidated financial statements, to the Shareholders by
disclosure through the Internet in accordance with theapplicable Ministry of Justice Order.
(Newly established)
Article 16 (Measures for Providing Information inElectronic Format)
1. When the Company convenes a Shareholders Meeting,it shall take measures for providing information that
constitutes the content of reference materials forshareholders meeting, etc. in electronic format.
2. Among items for which the measures for providing
information in electronic format will be taken, theCompany may exclude all or some of those items
designated by the Ministry of Justice Order fromstatements in the paper-based documents to be delivered
to shareholders who requested the delivery of paperbased documents by the record date of voting rights.

-7-

Current Articles of Incorporation
Article 19 (Number of Directors)
The Company shall have fifteen (15) or fewer Directors.

Proposed amendments
Article 19 (Number of Directors)
The Company shall have eleven (11) or fewer Directors.

Supplementary Provisions
Article 2 (Transitional Measure Relating to Advisor)
The provisions of Article 27 (Advisor) of the current
Articles of Incorporation in accordance with the resolutionof the 10th Annual Shareholders Meeting shall remain in
effect until the termination of the term of office of thecurrent Advisors.
(Newly established)

Supplementary Provisions(Deleted)

Article 2-8-(Transitional Measures Regarding Provision ofInformational Materials for General Meeting of
Shareholders in Electronic Format)
1. The amendment to the Articles of Incorporation
pertaining to Article 16 shall be effective from
September 1, 2022, which is the date of enforcement of
the revised provisions provided for in the proviso to
Article 1 of the Supplementary Provisions of the Act
Partially Amending the Companies Act (Act No. 70 of2019) (hereinafter referred to as the “Date of
Enforcement”).
2. Notwithstanding the provision of the preceding
paragraph, Article 16 of the Articles of Incorporation
before amendments (Internet Disclosure of Reference
Materials for Shareholders Meetings and Deemed
Provision) shall remain effective regarding any
Shareholders Meeting held on a date within six months
from the Date of Enforcement.
3. This Article shall be deleted on the date when six
months have elapsed from the Date of Enforcement or
three months have elapsed from the date of the
Shareholders Meeting in the preceding paragraph,
whichever is later.

Proposal 2: Election of Ten (10) Directors
The terms of office of all 12 Directors will expire at the conclusion of this Annual Shareholders Meeting.
Accordingly, based on the decision of the Nomination Committee to revitalize discussions from a point ofview optimal for the Group as a whole, and to promote building a governance structure that we should aim
for as a company with three committees (nomination, audit, and remuneration committees), the Company
proposes the election of ten candidates, reducing the number of Directors who concurrently serve as persons
responsible for business execution at subsidiaries by two.
If the candidates for Director in this proposal are elected as proposed, the Board of Directors will have astructure with six out of ten members, i.e. the majority of its members as independent Outside Directors, andthree female Directors. We believe this will lead to further strengthening of the oversight function by
separating it from the execution of business and to ensuring a more diverse Board of Directors.
Furthermore, of the candidates for Director, please refer to “3. Matters relating to corporate officers” inthe Business Report regarding the status of activities of six Outside Directors, and “6. Operation of the Boardof Directors” and “7. Operations of each Committee” in the Business Report regarding the status of operationsof the Board of Directors and each committee.
The candidates for the Directors are as follows.
Skills expected of candidates for Director
In selecting candidates for the Board of Directors, the Board of Directors shall consist of personnel withexperience and knowledge necessary to appropriately oversee the promotion of sustainability management(execution of business strategies aimed at resolving the seven materialities) in order to allow the Board of
Directors to effectively fulfill its roles and responsibilities. In selecting candidates for Outside Director, theCompany selects persons from the point of view of Board diversity who have experience as managers not
only in the retailing industry that forms the core of the Company’s business but in manufacturing and othernon-retail industries, and who have expertise in legal and other fields, a marketing perspective, and extensive
experience related to finance and accounting. With regard to candidates for non-executive Inside Director,
wide-ranging practical experience within the Group and knowledge in fields such as auditing are sought by
the Company. As for candidates for executive Director, the Company has selected a person responsible for
the Financial Department whose high level of knowledge will facilitate the execution of the strategic financial
policies demanded by our shareholders and investors, as well as by the President and Representative
Executive Officer of the Company.

-9-

No.

Name

Committee to belong(The “◎” mark indicates thecandidates of Chairperson.)

Attribute

Nomination

1
2

YAMAMOTO Ryoichi (Note 1)

Chairperson

Male

HAMADA Kazuko (Note 2)
FemaleReappointment

Non-executive

Reappointment

Non-executive

Audit

○

○
○

YAGO Natsunosuke

Male

Reappointment

Non-executive

Independent

Outside4

HAKODA Junya

Male

Reappointment

Non-executive

Independent

Outside5

UCHIDA Akira

Male

Reappointment

Non-executive

Independent

Outside6

SATO Rieko (Note 3) Female

Reappointment

Non-executive

Independent

Outside○7

SEKI Tadayuki

Male

Reappointment

Non-executive

Independent

Outside○8

KOIDE Hiroko

FemaleReappointment

Non-executive

Independent

OutsideMale

Reappointment

Executive

Reappointment

Executive

3

9
10

YOSHIMOTO Tatsuya

WAKABAYASHI Hayato
Male

Remuneration

◎

○
◎

○

◎

○

○

Expected skills as Candidate for Director

No.

Name

Management
strategies

Finance

MarketingHuman
resource&
organization
development

Legalaffairs &complianceIT &digitalE:
Environment

S:
SocietyG:
Governance

1

YAMAMOTO Ryoichi(Note 1)Chairperson

2

HAMADA Kazuko(Note 2)

3

YAGO Natsunosuke○

4

HAKODA Junya

○

○

○

5

UCHIDA Akira

○

○

○

6

SATO Rieko (Note 3)

7

SEKI Tadayuki

8

KOIDE Hiroko

○

○

9

YOSHIMOTO Tatsuya

○

○

10

WAKABAYASHI Hayato

○

○

○

○
○

○
○

○

○

○

○

○

○

○

○

○

○

○
○

○

○

○

(Notes) 1. If the election of YAMAMOTO Ryoichi is approved in this proposal, the Company plans to select him once again
as the Chairperson of Board of Directors at a Board of Directors meeting that is to be held after this Annual
Shareholders Meeting.
2. HAMADA Kazuko is recorded under the name of HIMENO Kazuko in the family register.
3. SATO Rieko is recorded under the name of KAMATA Rieko in the family register.
4. The Company plans to elect nine Executive Officers who do not concurrently serve as Directors at a Board of
Directors meeting that is to be held after this Annual Shareholders Meeting.

- 10 -

Reappointment
Non-executive
Executive
Independent
OutsideCandidate for reappointment as Director
Candidate for Director who does not concurrently serve as Executive Officer
Candidate for Director who concurrently serves as Executive Officer
Independent officer whose status as such is registered with the stock exchange
Candidate for Outside Director- 11 -

No.

Name(Date of birth)
April 1973
May 2003

YAMAMOTO
Ryoichi(March 27, 1951)

Gender: Male
Number of theCompany’s shares
owned (shares):98,016
Number of other sharesas stock-based
remuneration not yet
granted (shares):10,037
Special interests between
the Company and the
Candidate:1

Career summary, positions and areas of responsibility in the Company

None
Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:

Joined The Daimaru, Inc.
President and COO and General Manager of Department StoreOperations, Group Headquarters
September 2007
Director of J. Front Retailing Co., Ltd.
In charge of Sales Reform and Out-of-Store Sales (gaisho) Reform
Promotion
Executive General Manager of Department Store Operations
Headquarters and Planning Office for New Umeda Store, Head Officeof The Daimaru, Inc.
Director of Matsuzakaya Co., Ltd.
March 2008
Executive General Manager of Sales Headquarters, Head Office of The
Daimaru, Inc.
March 2010
President and Representative Director of Daimaru Matsuzakaya
Department Stores Co. Ltd.
September 2012
President and Representative Director of Daimaru Matsuzakaya
Department Stores Co. Ltd. and President and Representative Directorof Daimaru Matsuzakaya Sales Associates Co. Ltd.
April 2013
President and Representative Director of J. Front Retailing Co., Ltd.
May 2017
Director, President and Representative Executive Officer
May 2020
Director, Chairperson of Board of Directors (present)
June 2021
Outside Director of Daido Steel Co., Ltd (present)
Outside Director of NORITAKE CO., LIMITED (present)
Important concurrent positions
Outside Director of Daido Steel Co., Ltd
Outside Director of NORITAKE CO., LIMITED

15/15
Number of attendance at
the meetings ofNomination Committee
16/16
Number of attendance at
the meetings ofRemuneration
Committee
11/11
Tenure as Director (atthe conclusion of thisMeeting):
approx. 14 years and9 months

Reasons for nomination as candidate for Director and overview of expected roles-YAMAMOTO Ryoichi possesses broad-based insight and a high-level overview gained through his abundant experience
spanning overall retail operations. Since being appointed as President and Representative Director of the Company in 2013, hehas been precisely and efficiently managing business of the Group overall. In addition to formulating a new Group Vision thatshowed the direction of management strategies that is necessary considering the external environment surrounding the Groupand leading its permeation, he has been demonstrating strong leadership in positioning the Corporate Governance Code at thecenter of change and reform of corporate management. In light of his track record and abundant experience, and to achieve theGroup Vision and sustainability management in a business environment where uncertainty is increasing, the Company expects
him, as an Inside Director who is well versed in the Group’s overall strategy and the roles and expectations of individual
businesses, to help ensure the improved corporate value and sustained growth of the Group by serving as the Chairperson ofBoard of Directors and conducting supervisory operations that consider all stakeholders. As such, the Company has nominatedhim as a candidate to continue serving as Director.

- 12 -

No.

Name(Date of birth)

Career summary, positions and areas of responsibility in the Company

HAMADA Kazuko(Name in the family
register: HIMENO
Kazuko)(September 6, 1962)
Gender: Female
Number of the Company’s
shares owned (shares):266

April 1985
September 2000
March 2002
March 2005
March 2007
March 2010
March 2013
March 2015
May 2020
May 2021

Joined Parco Co., Ltd.
General Manager of Marketing Department of Sales Management
Division
Deputy General Manager of Kichijoji PARCO
General Manager of Kichijoji PARCO
General Manager of Shintokorozawa PARCO
Executive Officer (Personnel)
Executive Officer (Administration and Personnel)
Executive Officer (Group Audit Office)
AuditorDirector of J. Front Retailing Co., Ltd. (present)

Special interests between
the Company and the
Candidate:2

None
Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:
12/12
Number of attendance at
the meetings of Audit
Committee
14/14
Tenure as Director (at theconclusion of thisMeeting):
approx. 1 year

Reasons for nomination as candidate for Director and overview of expected roles-HAMADA Kazuko served as store manager of the Kichijoji and Shintokorozawa stores at Parco Co., Ltd. before being appointed
as Executive Officer of the company in March 2010. She then engaged in initiatives such as planning a senior management
development program as Executive Officer in charge of Administration and Personnel. Based on such abundant experience, she
has broad insight in the areas of store operations and business management of Parco Co., Ltd. as well as corporate diversity
promotion. Furthermore, she was in charge of the Group Audit Office from March 2015, and served as Auditor from May 2020,
contributing to strengthening the audit function of the Parco Business. As a member of the Audit Committee, since May 2021,
she has contributed to strengthening the audit function by auditing the execution of duties by Directors and Executive Officers
of a company with three committees (nomination, audit, and remuneration committees), while exchanging opinions andengaging in discussions from the perspective of legality, appropriateness, etc. related to items submitted to the Board of Directors
and items judged to require monitoring by the Audit Committee. The Company expects her to help ensure the improved corporate
value and sustained growth of the Group, particularly through the maximization of group synergies with Parco, by utilizing herabundant knowledge based on her achievements and experience and fulfilling appropriate management oversight work, andtherefore has nominated her to continue serving as Director.

- 13 -

No.

Name(Date of birth)

Career summary, positions and areas of responsibility in the Company

Independent
Outside Director

YAGO Natsunosuke(May 16, 1951)
Gender: Male
Number of the Company’s
shares owned (shares):
4,557
Number of other shares asstock-based remuneration
not yet granted (shares):
1,933
Special interests between
the Company and the
Candidate:3

None
Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:
15/15
Number of attendance at
the meetings ofNomination Committee
16/16

April 1977
June 2002
April 2004

Joined EBARA CORPORATION
Executive Officer
Senior Executive Officer, Group Executive of Precision Machinery
Group, Representative Director and Chairman of Ebara Precision
Machinery Europe GmbH, Representative Director and Chairman of
Ebara Technologies Inc. and Chairman of Ebara Precision Machinery
Shanghai Inc.
June 2004
Director
April 2005
Director and Chairman of Ebara Precision Machinery Taiwan Inc.
June 2005
Director, President of Precision Machinery Company and General
Manager of Fujisawa Operation
April 2006
Director and Managing Executive Officer
President of Precision Machinery Company
April 2007
President and Representative Director
May 2007
President and Representative Director and General Manager of Internal
Control Promotion Department
July 2009
President and Representative Director and General Manager of Internal
Control Department
April 2013
Chairman & Director
October 2017
Representative Director of The Ebara Hatakeyama Memorial
Foundation (present)
March 2019
Retired from the office of Chairman & Director of EBARACORPORATION
June 2019
Outside Director of SUBARU CORPORATION (present)
May 2020
Outside Director of J. Front Retailing Co., Ltd. (present)
May 2021
Director of Parco Co., Ltd. (present)
Important concurrent positions
Outside Director of SUBARU CORPORATION(Concurrent positions in the Group)
Director of Parco Co., Ltd.

Number of attendance at
the meetings ofRemuneration Committee
11/11
Tenure as Director (at theconclusion of thisMeeting):
approx. 2 years

Reasons for nomination as candidate for Outside Director and overview of expected roles-YAGO Natsunosuke has been involved in top-level company management for many years, and has abundant experience instrengthening financial bases and in compliance management. He also possesses highly specialized knowledge of internal control
and corporate governance gained through his experience of being involved in the transition to a company with three committees(nomination, audit and remuneration committees). He has contributed to improving the effectiveness of the Board of Directors
by actively and assertively providing advice and oversight on the overall management strategy of a holding company, including
the importance of the will and leadership of the Group’s top management, what the developer business should aspire to be, anddrastic measures such as structural reforms leading to a review of its business foundation. As the Chairperson of the Nomination
Committee, he has promoted discussions on the ideal structure of the Board of Directors of the Company and its major
subsidiaries, focusing on succession plans, making transparent and fair personnel decisions for executives, and confirming thestatus of candidates for future senior management positions. As a member of the Remuneration Committee, he has contributed
to the strengthening of the management human resources function by providing advice as necessary in the deliberation of policies
and review of specific operational rules concerning the executive remuneration system and the calculation method of stockbased remuneration and bonuses. In light of his track record, abundant experience and high level of insight, the Company expects
him to contribute greatly to management of the Group as an Outside Director. As such, he has been nominated as a candidate tocontinue serving as Outside Director.

- 14 -

No.

Name(Date of birth)

Career summary, positions and areas of responsibility in the Company
April 1974

Independent
Outside Director

HAKODA Junya(July 10, 1951)
Gender: Male
Number of the Company’s
shares owned (shares):886

4

Special interests between
the Company and the
Candidate:
None
Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:
12/12
Number of attendance at
the meetings of Audit
Committee
14/14
Tenure as Director (at theconclusion of thisMeeting):

Joined Mitsubishi Rayon Co., Ltd. (present Mitsubishi Chemical
Corporation)
November 1980
Joined Pricewaterhouse CPA Office(Reorganized as Aoyama Audit Corporation in June 1983)
April 1984
Registered as Certified Public Accountant
April 2000
Partner at the merged firm, ChuoAoyama Audit
Corporation/PricewaterhouseCoopers
August 2006
Representative of Arata Audit Corporation/Partner ofPricewaterhouseCoopers
April 2008
Eminent Professor of Graduate School of Keio University (internal
audit theory)
September 2009
Member of the Agreement Monitoring Committee of the Japan External
Trade Organization (JETRO)
September 2010
Director of Japan Internal Control Research Association
December 2014
Outside Corporate Auditor of Schroder Investment Management (Japan)
Limited (present)
March 2015
Director of Institute of Corporate Governance, Japan (present)
June 2015
Outside Corporate Auditor of Yamaha Corporation
June 2015
Outside Director of AEON Financial Service Co., Ltd.
June 2017
Outside Director and Chairperson of the Audit Committee of Yamaha
Corporation
September 2019
Member of the Ethics Committee of the Japanese Institute of Certified
Public Accountants (present)
May 2021
Outside Director of J. Front Retailing Co., Ltd. (present)
August 2021
Chairperson of the Committee on Training and Research for Outside
Officers, Japanese Institute of Certified Public Accountants (present)
Important concurrent positions
Member of the Ethics Committee of the Japanese Institute of Certified Public Accountants
Chairperson of the Committee on Training and Research for Outside Officers, JapaneseInstitute of Certified Public Accountants

approx. 1 year

Reasons for nomination as candidate for Outside Director and overview of expected roles-HAKODA Junya was involved in accounting audits, management consulting, and internal audits of auditing firms, etc. for many
years at PricewaterhouseCoopers, also served as an eminent professor teaching internal audit theory at Graduate School of Keio
University, and therefore has abundant experience and high-level expertise in corporate auditing. He also has a high level ofexpertise in corporate governance and management auditing, having served as the Chairperson of the Audit Committee of
Yamaha Corporation when the company changed its organizational design to a company with three committees (nomination,
audit, and remuneration committees). He has also contributed to improving the effectiveness of the Board of Directors by actively
and assertively furnishing advice and oversight regarding the importance of indicators, such as ROIC as a Medium-term Business
Plan objective and cash flow at the time of business infrastructure review and segment review, and the creation of a road map
for monitoring digital strategies from a comprehensive perspective. Moreover, as a member of the Audit Committee, he has
endeavored to strengthen the audit function by fulfilling his roles of auditing the execution of duties by Directors and Executive
Officers of a company with three committees (nomination, audit, and remuneration committees), while exchanging opinions andengaging in discussions from the perspective of legality and appropriateness, etc. related to items submitted to the Board of
Directors and items judged to require monitoring by the Audit Committee, which he is expected to promote. He is also
simultaneously working to enhance the governance of the Group as a whole. In light of his track record, abundant experienceand high level of insight, the Company expects him to contribute greatly to management of the Group as an Outside Director.
As such, he has been nominated as a candidate to continue serving as Outside Director.

- 15 -

No.

Name(Date of birth)

Career summary, positions and areas of responsibility in the Company
April 1975
June 1996
June 2000

Independent
Outside Director

UCHIDA Akira(October 4, 1950)
Gender: Male
Number of the Company’s
shares owned (shares):4,292
Number of other shares asstock-based remuneration
not yet granted (shares):
3,866
Special interests between
the Company and the
Candidate:

5

None
Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:
15/15

Joined Toray Industries, Inc.
Executive Vice President of Toray Industries (America), Inc.
General Manager on Special Assignment of Corporate Strategic
Planning Division 1, General Manager on Special Assignment ofCorporate Communications Dept. of Toray Industries, Inc.
June 2004
Counsellor of Corporate Strategic Planning Division, and Counsellor of
Investor Relations Dept.
June 2005
Member of the Board, General Manager of Finance and Controller’s
Division
President, Toray Holding (USA), Inc.
June 2009
Senior Vice President (Member of the Board), General Manager ofFinance and Controller’s Division
President, Toray Holding (USA), Inc.
June 2012
Senior Vice President (Member of the Board), in charge of CSR;
General Manager of General Administration and Legal Division,
Investor Relations Dept., Corporate Communications Dept., andAdvertising Dept., Tokyo Head Office
June 2016
AdviserMarch 2019
Retired from Adviser
May 2019
Outside Director of J. Front Retailing Co., Ltd. (present)
June 2019
Outside Director of Yokogawa Electric Corporation (present)
May 2020
Director of Daimaru Matsuzakaya Department Stores Co. Ltd. (present)
Important concurrent positions
Outside Director of Yokogawa Electric Corporation(Concurrent positions in the Group)
Director of Daimaru Matsuzakaya Department Stores Co. Ltd.

Number of attendance at
the meetings ofNomination Committee
16/16
Number of attendance at
the meetings ofRemuneration Committee
11/11
Tenure as Director (at theconclusion of thisMeeting):
approx. 3 years

Reasons for nomination as candidate for Outside Director and overview of expected roles-UCHIDA Akira possesses broad experience and knowledge in the corporate division, as a manager in charge of management
planning and IR, as well as as the person responsible for the finance and accounting division, and has contributed to improving
the effectiveness of the Board of Directors by actively and assertively providing advice and oversight with respect toappropriately conveying information to stakeholders, strengthening collaboration as a holding company among the Group, theneed for new businesses when reviewing business portfolios, etc. As the Chairperson of the Remuneration Committee, he haspromoted discussions on the review of specific operational rules concerning the executive remuneration system and thecalculation method of stock-based remuneration and bonuses. As a member of the Nomination Committee, he has contributed
to the strengthening of the management human resources function by providing advice as necessary in the deliberation on theideal structure of the Board of Directors of the Company and its major subsidiaries, focusing on succession plans, making
transparent and fair personnel decisions for executives, and confirming the status of candidates for future senior management
positions, etc. In light of his track record and abundant insight, the Company expects him to contribute greatly to managementof the Group as an Outside Director. As such, he has been nominated as a candidate to continue serving as Outside Director.

- 16 -

No.

Name(Date of birth)
Independent
Outside Director

SATO Rieko(Name in the family
register: KAMATA
Rieko)(November 28, 1956)
Gender: Female
Number of the Company’s
shares owned (shares):2,483
Number of other shares asstock-based remuneration
not yet granted (shares):
5,799

6

Special interests between
the Company and the
Candidate:
None

Career summary, positions and areas of responsibility in the Company
April 1984
August 1989
July 1998
June 2004
June 2012
June 2015
October 2016

Registered as attorney at law
Shearman & Sterling LLP
Partner of Ishii Law Office (present)
External Audit & Supervisory Board Member of Ajinomoto Co., Inc.
Outside Corporate Auditor of NTT DATA CORPORATION
Outside Director of The Dai-ichi Life Insurance Company, Limited
Outside Director (Audit and Supervisory Committee Member) of Daiichi Life Holdings, Inc. (present)
May 2018
Outside Director of J. Front Retailing Co., Ltd. (present)
May 2019
Director of Daimaru Matsuzakaya Department Stores Co. Ltd. (present)
June 2020
Outside Director (Member of the Audit and Supervisory Committee) of
NTT DATA CORPORATION (present)
Outside Audit & Supervisory Board Member of Mitsubishi Corporation(present)
Important concurrent positions
Partner of Ishii Law OfficeOutside Director (Audit and Supervisory Committee Member) of Dai-ichi Life Holdings,
Inc.
Outside Director (Member of the Audit and Supervisory Committee) of NTT DATACORPORATION
Outside Audit & Supervisory Board Member of Mitsubishi Corporation(Concurrent positions in the Group)
Director of Daimaru Matsuzakaya Department Stores Co. Ltd.

Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:
15/15
Number of attendance at
the meetings of Audit
Committee
20/20
Tenure as Director (at theconclusion of thisMeeting):
approx. 4 years

Reasons for nomination as candidate for Outside Director and overview of expected roles-SATO Rieko possesses abundant experience as an outside director and outside audit & supervisory board member at othercompanies, in addition to having made a career in handling many projects with in-depth and specialized knowledge as an attorneyat law specializing in corporate legal affairs. She has contributed to improving the effectiveness of the Board of Directors byproviding assertive and active advice and oversight from legal perspectives on strengthening measures as a holding company
for the Medium-term Business Plan, the need for measures to increase the speed of digital strategies, formulating concrete
proposals in line with the Group’s business policy for the fiscal year, and on other proposed agenda items. Moreover, as amember of the Audit Committee, she has contributed to strengthening the audit function by auditing the execution of duties byDirectors and Executive Officers of the company with three committees (nomination, audit, and remuneration committees),
while exchanging opinions and engaging in discussions from the perspective of legality and appropriateness related to items
submitted to the Board of Directors and items judged to require monitoring by the Audit Committee. In light of her track recordand abundant insight, the Company expects her to contribute greatly to management of the Group as an Outside Director. As
such, she has been nominated as a candidate to continue serving as Outside Director.

- 17 -

No.

Name(Date of birth)
April 1973
June 1998

Independent
Outside Director

SEKI Tadayuki(December 7, 1949)
Gender: Male
Number of the Company’s
shares owned (shares):
2,160
Number of other shares asstock-based remuneration
not yet granted (shares):
1,933

7

Career summary, positions and areas of responsibility in the Company

Special interests between
the Company and the
Candidate:
None
Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:
15/15
Number of attendance at
the meetings of Audit
Committee

Joined ITOCHU Corporation
General Manager, Finance Division, ITOCHU International Inc.
(Stationed in New York)
June 2004
Executive Officer of ITOCHU Corporation, CFO of Food Company
April 2007
Managing Executive Officer, General Manager of Finance Division
June 2009
Representative Director, Managing Director, Chief Officer for Finance,
Accounting, Risk Management and CFO
April 2010
Representative Director, Senior Managing Executive Officer
May 2011
Representative Director, Senior Managing Executive Officer and CFO
April 2013
Representative Director, Executive Vice President and CFO
April 2014
Representative Director, Executive Vice President, Executive Advisory
Officer, CFO & CAO
April 2015
Adviser
May 2016
External Director of Parco Co., Ltd.
June 2016
Outside Director of NIPPON VALQUA INDUSTRIES, LTD. (present
VALQUA, LTD.) (present)
April 2017
Advisory Member of ITOCHU Corporation (present)
June 2017
Outside Director of JSR Corporation (present)
July 2017
Outside Statutory Auditor of Asahi Mutual Life Insurance Company(present)
May 2020
Outside Director of J. Front Retailing Co., Ltd. (present)
Director of Parco Co., Ltd. (present)
Important concurrent positions
Outside Director of VALQUA, LTD.
Outside Director of JSR Corporation
Outside Statutory Auditor of Asahi Mutual Life Insurance Company(Concurrent positions in the Group)
Director of Parco Co., Ltd.

20/20
Tenure as Director (at theconclusion of thisMeeting):
approx. 2 years

Reasons for nomination as candidate for Outside Director and overview of expected roles-SEKI Tadayuki was involved in international business management and risk management at a general trading company for many
years, and has extensive experience in finance and accounting as CFO, as well as abundant experience as an outside director andoutside corporate auditor of multiple companies. He has contributed to improving the effectiveness of the Board of Directors byactively and assertively providing advice and oversight on the importance of capital cost-conscious financial strategies, the needfor an adequate variation in M&A business portfolios, etc. Moreover, as a member of the Audit Committee, he has contributed
to strengthening the audit function by auditing the execution of duties by Directors and Executive Officers of the company withthree committees (nomination, audit, and remuneration committees), while exchanging opinions and engaging in discussions
from the perspective of legality and appropriateness related to items submitted at the Board of Directors or items judged torequire monitoring by the Audit Committee. In light of his track record and high level of insight, the Company expects him tocontribute greatly to management of the Group as an Outside Director. As such, he has been nominated as a candidate to continue
serving as Outside Director.

- 18 -

No.

Name(Date of birth)

Career summary, positions and areas of responsibility in the Company
September 1986

Independent
Outside Director

KOIDE Hiroko(August 10, 1957)
Gender: Female
Number of the Company’s
shares owned (shares):885
Special interests between
the Company and the
Candidate:
None

8

Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:
12/12

Joined J. Walter Thompson Japan K.K. (present Wunderman Thompson
Tokyo G.K.)
May 1993
Joined Nippon Lever K.K. (present Unilever Japan K.K.)
April 2001
Director
April 2006
General Manager of Marketing Management Division of Masterfoods
Ltd. (present Mars Japan Limited)
April 2008
Chief Operating Officer
November 2010
President and Representative Director of Parfums Christian Dior Japon
K.K.
January 2013
Outside Director of Kirin Co., Ltd.
April 2013
Senior Vice President of Global Marketing of Newell Rubbermaid Inc.
(U.S.) (present Newell Brands Inc.)
June 2016
Outside Director of Mitsubishi Electric Corporation (present)
April 2018
Director of Vicela Japan Co., Ltd.
June 2019
Outside Director of Honda Motor Co., Ltd
Outside Director of J-OIL MILLS, Inc. (present)
May 2021
Outside Director of J. Front Retailing Co., Ltd. (present)
Important concurrent positions
Outside Director of Mitsubishi Electric Corporation
Outside Director of J-OIL MILLS, Inc.

Number of attendance at
the meetings ofNomination Committee
12/12
Number of attendance at
the meetings ofRemuneration Committee
7/7
Tenure as Director (at theconclusion of thisMeeting):
approx. 1 year

Reasons for nomination as candidate for Outside Director and overview of expected roles-KOIDE Hiroko has knowledge based on her extensive experience in the global management field and the marketing field, having
served as an officer at foreign companies for many years, and having been engaged in corporate management as the head ofmarketing at the head office of a U.S. company, as well as abundant knowledge gained as an Outside Director at several listedcompanies. She has contributed to improving the effectiveness of the Board of Directors by actively and assertively providing
advice and oversight with respect to making measures more concrete for the Medium-term Business Plan, etc. as a holding
company, the importance of a marketing-oriented way of thinking, such as identifying targets and needs, analyzing the factors
and providing measures in cases when there are gaps between the target and the actual results, etc. She has contributed to thestrengthening of the management human resources function by providing advice as necessary as a member of the Nomination
Committee in the deliberation on the ideal structure of the Board of Directors of the Company and its major subsidiaries, focusing
on succession plans, making transparent and fair personnel decisions for executives, and confirming the status of candidates for
future senior management positions, etc., and as a member of the Remuneration Committee in the deliberation of policies andreview of specific operational rules concerning the executive remuneration system and the calculation method of stock-based
remuneration and bonuses. In light of her track record, abundant experience and high level of insight, the Company expects her
to contribute greatly to management of the Group as an Outside Director. As such, she has been nominated as a candidate tocontinue serving as Outside Director.

- 19 -

No.

Name(Date of birth)

Career summary, positions and areas of responsibility in the Company
April 1979
March 2000

YOSHIMOTO
Tatsuya(April 13, 1956)

January 2008
May 2008
January 2010

Gender: Male
Number of the Company’s
shares owned (shares):81,742
Special interests between
the Company and the
Candidate:None

9

Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:

March 2010
May 2012
April 2013

May 2013
May 2017
May 2020

Joined The Daimaru, Inc.
Senior Manager of Preparatory Office for Opening Sapporo Store ofPlanning Office for Sapporo Store, Head Office
General Manager of Tokyo Store
Corporate Officer, General Manager of Tokyo Store
Corporate Officer, General Manager of Sales Planning Promotion
Division and Marketing Planning Promotion Division of Department
Stores Coordination Division of J. Front Retailing Co., Ltd.
Corporate Officer of Daimaru Matsuzakaya Department Stores Co. Ltd.
Senior General Manager of Management Planning Division
Director and Corporate Officer
President and Representative Director of Daimaru Matsuzakaya
Department Stores Co. Ltd. and President and Representative Directorof Daimaru Matsuzakaya Sales Associates Co. Ltd.
Director of J. Front Retailing Co., Ltd. (present)
Representative Managing Executive Officer
President and Representative Executive Officer (present)

15/15
Number of attendance at
the meetings ofNomination Committee
4/4
Number of attendance at
the meetings ofRemuneration Committee
4/4
Tenure as Director (at theconclusion of thisMeeting):
approx. 9 years

Reasons for nomination as candidate for Director and overview of expected roles-YOSHIMOTO Tatsuya has abundant experience and insight into the whole of the Department Store Business, particularly thoseareas related to business management, planning and store operations. Since being appointed as President and Representative
Director of Daimaru Matsuzakaya Department Stores Co. Ltd. in 2013, he has been involved in executing existing high-quality
department store business strategy considering the roles and expectations of the Department Store Business under the Group’s
strategy, and formulating a new Department Store Business strategy in reaction to the massive changes in the external
environment. He has been demonstrating swift and resoundingly effective leadership based on a strong results-oriented approach
aimed at realizing these initiatives. Since 2017, as Representative Managing Executive Officer of the Company, he has
accumulated further knowledge based on his experiences in business management for the Group as a whole and management
reform based on the Corporate Governance Code. Since being appointed as President and Representative Executive Officer of
the Company in FY2020, amid the severe business environment, he has exercised leadership aiming for a future-proof businessreform, building a foundation for sustainability management in the Medium-term Business Plan started this fiscal year throughthe decisive action of carrying out a structural reform in order to completely recover to the level of operating profit in FY2019.
In light of his track record and experience, the Company has judged that he is a competent professional who is capable of helping
ensure the improved corporate value and sustained growth of the Group and has accordingly nominated him as a candidate tocontinue serving as Director.

- 20 -

No.

Name(Date of birth)

WAKABAYASHI
Hayato(August 31, 1961)
Gender: Male
Number of the Company’s
shares owned (shares):13,33910

Special interests between
the Company and the
Candidate:
None
Number of attendance at
the Board of Directors
meetings for the 15th
fiscal year:
15/15
Tenure as Director (atthe conclusion of thisMeeting):

Career summary, positions and areas of responsibility in the Company
April 1985

Joined Matsushita Electric Industrial Co., Ltd. (present Panasonic
Corporation)
April 1998
President of Panasonic Financial Center Malaysia Co., Ltd.
April 2007
Director and Chief Executive Officer of Matsushita Electric (China)
Finance Limited
February 2009
Finance Planning Team Leader (Manager), Headquarters Finance & IR
Group of Panasonic Corporation
July 2013
General Manager, Finance & IR Group, Corporate Strategy Division
and Finance Strategy Team Leader of Panasonic Corporation (Director)
May 2015
Joined J. Front Retailing Co., Ltd.
In charge of Finance Policy, Administration Unit
September 2015
Executive Officer
In charge of Financial Strategy and Policy, Administration Unit
March 2016
Senior Executive General Manager of Financial Strategy Unit (present)
and in charge of Finance Policy
May 2016
Director (present)
March 2017
In charge of Financing and Finance Policy
May 2017
Managing Executive Officer (present)
May 2018
Senior General Manager of Financing and Finance Policy Division
May 2020
Director of Parco Co., Ltd. (present)
Important concurrent positions(Concurrent positions in the Group)
Director of Parco Co., Ltd.

approx. 6 years

Reasons for nomination as candidate for Director and overview of expected roles-WAKABAYASHI Hayato has pursued a career mainly in the financial realm of Panasonic Corporation and its group companies,
and as such has adequate insight and sufficient experience related to financial policy with respect to enhancing financial standing,
improving levels of cash management and other such initiatives. As such, he was invited into the Group in May 2015 and has
established and promoted a financial strategy encompassing the entire Group. Since 2016, he has been promoting financial
strategies and programs for the Group as a whole, by implementing measures aimed at applying the IFRS accounting standard
and enhancing capital profitability as well as raising funds to support the continuation of corporate activities by implementing
appropriate financial measures amid the severe business environment caused by COVID-19, formulating tax policies andbeginning the reform of the accounting system with an eye to the future. In addition to such achievements and in-depth insighton finance, he has the commensurate abilities as a management professional in terms of his strategic and transformation-minded
leadership, strong results-oriented approach and other such attributes. As such, the Company has judged that he is a competentprofessional who is capable of helping ensure the improved corporate value and sustained growth of the Group by executing
business acting as a Director, and has accordingly nominated him as a candidate to continue serving as Director.

- 21 -

Special notes regarding the candidates for Director-The Company has entered into an agreement with candidates for Directors YAMAMOTO Ryoichi, HAMADA Kazuko, YAGO
Natsunosuke, HAKODA Junya, UCHIDA Akira, SATO Rieko, SEKI Tadayuki and KOIDE Hiroko individually to limit theliability of damages stipulated in Paragraph 1, Article 423 of the Companies Act as prescribed in Paragraph 1, Article 427 of
the said Act.
-The Company has entered into a Directors and Officers liability insurance contract with an insurance company as prescribed in
Paragraph 1, Article 430-3 of the Companies Act. Under such insurance contract, the Company will bear the full amount of
insurance premiums for all the insured. The insurance policy covers all Directors and Executive Officers of the Company andall Directors and Audit & Supervisory Board Members of its subsidiaries. All candidates for Directors are included in theinsured persons of the said insurance contract.
-Candidates for Directors YAGO Natsunosuke, HAKODA Junya, UCHIDA Akira, SATO Rieko, SEKI Tadayuki and KOIDE
Hiroko are independent officers who have been given the obligation by the Tokyo Stock Exchange, Inc. and the Nagoya Stock
Exchange, Inc. to protect ordinary shareholders.
-At Mitsubishi Electric Corporation, where candidate for Director KOIDE Hiroko has been in office as an Outside Director
since June 2016, several incidents of quality misconduct regarding several products of the company came to light from April
2021. After the incidents came to light, several manufacturing bases of the company related to the incidents received notice,some that their ISO9001 and IRIS certifications would be suspended, and other that part of the scope of their ISO9001
certification and the whole of their IRIS certification would be canceled from July 2021 and onwards. She was not directly
involved in the incidents and was not aware of the incidents until they came to light. She has regularly provided advice fromthe point of view of compliance with laws and regulations even before the incidents came to light, such as by expressing her
opinion at meetings of the Board of Directors regarding the importance of a change in thinking with regard to quality issues,
etc., and has continued to fulfill her duty as an Outside Director after the incidents came to light by providing advice andoversight with respect to efforts aimed at thorough compliance with laws and regulations and with contracts and at theimplementation of effective measures to prevent fraud.

(Reference) The Company’s criteria for determining independence of Outside Directors are as follows.
In appointing the Company’s Outside Directors, we select individuals who maintain a high degree of
independence and consequently are not susceptible to conflicts of interest involving the Company’s
shareholders. An individual does not meet the criteria for independence if one or more of the items listed
below apply to that individual.
(i) Person who executes business in the J. Front Retailing Group (the “Group”)(ii) Major shareholder of the Company (including person who executes business thereof; the same applies
with items (iii) to (vi) below)(iii) Major business partner of the Group(iv) Person affiliated with a law office, audit firm, consultancy or other entity that receives payment otherthan executive compensation of more than a certain amount from the Group(v) Recipient of donations of more than a certain amount contributed by the Group(vi) Related party in cases where the party is engaged in an arrangement involving a reciprocal officer
appointment with the Group(vii) Person with respect to whom any of items (i) to (vi) has applied at any point over the last five years(viii)Spouse or relative within the second degree of consanguinity of a person with respect to whom anyof the items (i) to (vii) applies
With respect to the above, “person who executes business” refers to an Executive Director, an Executive
Officer, and any other employee; “major shareholder” refers to a shareholder who holds voting rights
accounting for no less than 10% of the Company’s voting rights; “major business partner” refers to abusiness partner whose transactions with the Group account for 2% or more of the Company’s annual
consolidated net sales or the business partner’s annual net sales for any of the fiscal years over the last
five years; “a certain amount” refers to an annual amount of ¥10 million in any of the fiscal years overthe last five years.

- 22 -

[Reference Document for the 15th Annual Shareholders Meeting]Business Report (From March 1, 2021 to February 28, 2022)
1. Current status of the corporate group(1) Business summary and results
In the fiscal year under review, the Japanese economy encountered ongoing instability, which waspartly attributable to a situation where the worldwide spread of COVID-19 persisting since last year
significantly affected social and economic activities in Japan and overseas, and also attributable torapidly mounting geopolitical risks in the latter half of the fiscal year.
As for corporate earnings, signs of improvement emerged largely due to expanding external
demand amid resumption of global economic activity, yet earnings disparity between industries
widened amid a situation where the in-person services sector has been subject to severe restrictions
limiting movement particularly in the form of controls on flows of people and voluntary restraints on
business operations associated with the spread of COVID-19. In addition, the outlook has become
furthermore uncertain amid increasingly conspicuous effects of surging resource prices and materials
supply shortages.
Despite personal spending having exhibited signs of recovery beginning in October amid adecreasing number of COVID-19 cases and progress made with respect to vaccinations, challenging
circumstances have persisted amid a resurgence of deteriorating consumer sentiment caused byfactors that include rapid proliferation of infections involving COVID-19 variants at the end of the
fiscal year and imposition of strict infection control measures.
◆ Initiatives for the initial fiscal year of the FY2021-FY2023 Medium-term Business Plan
The Company has embarked on its new Medium-term Business Plan, which positions sustainability
at the core of management and sets its sights on the corporate vision for 2030, amid the unprecedented
crises of the COVID-19 pandemic. Under the Medium-term Business Plan, (1) we aim to achieve“complete recovery” in terms of ensuring that our performance indicators return to levels of fiscal
2019 prior to the COVID-19 pandemic, and (2) we have positioned the period covered by the plan to
be one of poising ourselves for “regrowth” beginning in fiscal 2024.
During the current fiscal year, which constituted the initial year of the Medium-term Business Plan,
the outlook remained uncertain due to COVID-19 with the infection having spread intermittently
throughout the year. Amid those circumstances, we strove to manage operations in a manner thatinvolves addressing persistently changing circumstances across our respective businesses, with our
top priority placed on ensuring the safety and security of our customers and employees, and achieving
business continuity. We also took a flexible approach in terms of implementing measures that entail
cutting costs and carefully selecting investments even during the fiscal year.
Our commitment to sustainability primarily involved engaging in business activities and new
business development integrating our seven materiality issues (priority issues) with our key strategies,
reducing greenhouse gas emissions looking toward our medium- to long-term targets, and seeking
solutions to environmental and social challenges in cooperation with our suppliers (refer to “(6) The
Group’s sustainability initiatives” for further details on our commitment to sustainability).
At the same time, we steadily promoted initiatives set forth in the Medium-term Business Plan interms of the “three key strategies,” “management structure reforms,” and “strengthening ofmanagement foundation.”- 23 -

Overall Composition of the FY2021-FY2023 Medium-term Business PlanThree key strategies and management structure reforms
1) Real x digital strategy
The Company’s digital strategy is implemented with the aim of providing new experience value
extending beyond temporal and spatial constraints by enlisting digital technologies combined with theappeal of brick-and-mortar stores and human resources, thereby extending above and beyond
initiatives that merely involve strengthening e-commerce.
Our efforts to increase the attractiveness of our stores has involved developing content thatprovides new value for department stores, particularly in terms of enhancing luxury brands and otherkey categories centered on the flagship stores, developing sales floors that enlist integration of directto-consumer brands (where creators and manufacturers deal directly with consumers), having PARCO
promote renovation of its flagship stores with sights set on rebranding of stores, and opening medical
wellness malls that seamlessly provide a range of services from medical treatment to the sales ofgoods and services.
Our efforts involving use of digital technologies have entailed digitalizing customer contact points
particularly by increasing the app membership count in the Department Store and PARCO businesses,
and developing original OMO operations (offline brick-and-mortar stores merged with online)
particularly for cosmetics and art, inspired by brick-and-mortar stores, looking toward expanding
business using online platforms. In addition, we have entered the market of fashion subscription,
which serves as a business initiative undertaken from the perspective of CSV (creating shared value)
using online platforms.
2) Prime life strategy
Under our prime life strategy, we have been expanding our high-quality customer base, which is astrength of the Company, while strengthening our proposals for consumers who enjoy fulfilling,sustainable lifestyles.
In the Department Store Business, we worked to increase the value of the customer experience
derived from both brick-and-mortar stores and online platforms. This has involved enhancing key
categories, developing refined store environments that are distinctive to brick-and-mortar storesparticularly by constructing lounges for our loyal customers, offering scarce merchandise and services
through our loyal customer-exclusive website, and upgrading our remote sales services. In addition,
we took steps to provide new services including a family trust service in our Payment and FinanceBusiness.

- 24 -

3) Developer strategy
We have set our sights on transforming our business portfolio enlisting efforts of the Developer
Business, which is a new business segment. This has involved helping to create bustling towns
underpinned by coexistence with local communities, building foundations for “regrowth” in fiscal
2024 and beyond with a focus on increasing the value of our real estate holdings, and proceeding withupfront investment.
In the current fiscal year, we have made progress in deriving revenue from existing properties
unified within PARCO through their effective use, and have furthermore been promoting district
development in Nagoya’s Sakae area in partnership with other companies. In addition, we have beenbuilding foundations for achieving medium- to long-term growth, which has involved devising plansfor development of large-scale complexes in the Group’s key areas, making sophisticated use of ourasset holdings, and taking action to diversify into multiple revenue streams.
4) Management structure reforms
We have been implementing the most important measures for complete recovery to levels of fiscal
2019 in conjunction with our key strategies, which have involved: (1) reducing fixed costs throughstructure reforms, and (2) increasing management efficiency and asset efficiency.
As for our initiatives to reduce fixed costs during the current fiscal year, we achieved reductions
exceeding initial estimates primarily by promoting organizational and personnel structure reforms
through business model reforms in the Department Store Business and by prompting a shift to digitaladvertising.
In addition, our efforts to improve management efficiency and asset efficiency involved setting oursights on transforming our business portfolio. To such ends, we transferred all shares of NEUVE A
Co., Ltd. in the specialty store business at the end of June, transferred some shares of Dimples’ Co.,
Ltd. in the staffing service business at the end of February, and furthermore sold non-business assets.
◆ Strengthening management foundation to support achievement of medium- to long-term
growthUnder the Group financial strategy, we have been seeking to ensure liquidity of funds aligned withchanges in the business environment amid the COVID-19 pandemic. The Company furthermore
issued sustainability bonds for the first time in May as a new means of procuring funds. In addition,
we made the decision to adopt the consolidated taxation system beginning in fiscal 2022 in aiming tostrengthen tax governance and optimize tax costs.
Under the Group human resource strategy, we made progress in recruiting work-readyprofessionals equipped with requisite specialized knowledge and skills particularly in the digital realm
with the aim of steadily promoting our key strategies. In addition, we promoted initiatives on the basisof the Company’s materiality issues, particularly with respect to encouraging active participation of
women and setting up remote work arrangements aligned with diversification of work styles.
Under the Group IT strategy, we have embarked on efforts to rebuild backbone systems in seeking
to develop more sophisticated management and administration, particularly by revamping Group-wideaccounting systems in conjunction with lending support for promoting digital strategies in our
respective businesses.
Consolidated revenue for the fiscal year under review
With respect to consolidated earnings for the current fiscal year, revenue was ¥331,484 million, up
3.9% year on year, partly due to a rebound in the wake of suspended store operations and shortened
operating hours in the Department Store and PARCO businesses in the previous fiscal year, in
addition to various measures including those mentioned above.
Furthermore, business profit was ¥11,718 million, up 395.1% year on year, as a result of efforts
throughout the fiscal year that involved curbing investment and reducing expenses. Operating profit
was ¥9,380 million (operating loss of ¥24,265 million in the previous fiscal year) largely due torecording of gain on sales of shares of subsidiaries, gain on sales of non-current assets, and structural- 25 -

reform costs. Profit before tax was ¥6,190 million (loss before tax of ¥28,672 million in the previous
fiscal year), and profit attributable to owners of parent was ¥4,321 million (loss attributable to ownersof parent of ¥26,193 million in the previous fiscal year).
Regarding dividends, the Company has decided to pay an annual dividend of ¥29 per share (¥27 in
the previous fiscal year), for an increase of ¥2 relative to the previous fiscal year. With respect to thebalance of the interim dividend and year-end dividend, the interim dividend amounted to ¥14 pershare for an increase of ¥5 relative to the previous fiscal year (¥9 in the previous fiscal year), and theyear-end dividend amounted to ¥15 per share for a decrease of ¥3 relative to the previous fiscal year.
Key performance indicator targets

Consolidated operating
profit (IFRS)FY2019results¥40,286
millionFY2020results¥(24,265)
millionConsolidated ROE

5.4%(7.1)%

1.2%

7.0%

Consolidated ROIC

–

0.2%

1.2%

5.0%

(16.3)%(32.0)%(undercalculation)(40)%

Greenhouse gas emissions*

FY2021
results¥9,380 million

FY2023targets¥40,300
millionRatio of women in
16.6%
19.9%
21.3%
26%
management positions*Scope 1 and 2 emissions compared with FY2017. The result of FY2021 is under calculation.

- 26 -

(Reference) Changes in the Reportable Segments• From the fiscal year ended February 28, 2022, the Group has four business segments; theDepartment Store Business, the SC (Shopping Center) Business, the Developer Business, and the
Payment and Finance Business.
• The changes in the reportable segments under the Group, the major subsidiaries, and theclassification of the real estate properties for the fiscal year ended February 28, 2021 and the fiscal
year ended February 28, 2022 are as follows.
(Note) In the chart below, the scope of the existing PARCO Business is presented within the dotted lines.

* “Ueno Frontier Tower (lease)” up to February 2021 includes real estate lease revenue from PARCO
Co., Ltd. on PARCO_ya Ueno.

- 27 -

Results by segment are as follows.
Revenue and operating profit by business segment of the corporate group(Millions of yen)
15th fiscal year (Current fiscal year)(Fiscal 2021)

14th fiscal year
(Fiscal 2020)
Business segment

Revenue
Results

Operating profit

Composition

Revenue

Composition

Results%

Results%

Composition

Results

Composition%

Department StoreBusiness

173,83154.5(20,785)

SC Business

55,44917.4(6,968)–Developer Business

53,825

16.9

1,981

–

Payment and FinanceBusiness

9,035

2.8

421

–

11,037

Total

292,14291.6(25,351)–

304,967

Other

62,559

19.6

1,724

–

61,755–

Operating profit

190,739%

57.5(4,594)–52,556

15.9

2,055

–

50,633

15.3

4,711

–

3.3

1,970

–

92.0

4,142

–

18.6

1,199

–

Adjustments(35,622)(11.2)(638)–(35,239)(10.6)

4,039–

Consolidated total

319,079

100.0(24,265)

100.0

331,484

100.0

9,380

100.0

- 28 -

Department Store Business
Revenue of ¥190,739 million (+9.7% YoY), operating loss of ¥4,594 million (operating loss of¥20,785 million in the previous fiscal year)<Reference data>
Gross sales of ¥555,845 million (+16.5% YoY), business profit of ¥1,798 million (business loss of¥2,936 million in the previous fiscal year)
The adverse business environment persisted amid a situation where each store was forced to suspend
on-site sales of items other than daily necessities particularly in the first half, along with imposition ofshorter operating hours and entry restrictions, all associated with application of state of emergency
declarations and strict infection control measures.
On the other hand, we promoted digital sales activities that involved strengthening app-based
communications with customers and upgrading remote sales services. Moreover, our OMO initiatives
entailed launching the new ARToVILLA media service for conveying the appeal of art in both physicalstores and online.
To increase the attractiveness of stores, we enhanced key categories and constructed lounges for ourloyal customers particularly in our flagship stores. We also sought to create new stores that are integral
to their respective communities with renovation and re-openings of the Daimaru Suma store in Marchand the Matsuzakaya Takatsuki store in July. In addition, at the Daimaru Tokyo store we sought
development of new content that entailed opening “asumise,” a showrooming space for direct-toconsumer brands. We ceased operations of the Matsuzakaya Toyota store in September.
In addition, we engaged in initiatives involving organizational and personnel structure reforms with
our sights set on business model reforms, which was in addition to absorption-type merger of a sales
function subsidiary and overhaul of outsourcing operations for the sake of heightening flexibility inaddressing the changing business environment as well as improving organizational and employee
productivity.
As a result of various measures including those mentioned above, along with a rebound fromsuspension of store operations, among other factors, revenue was ¥190,739 million, up 9.7% year on
year. Operating loss improved relative to the previous fiscal year to ¥4,594 million (operating loss of¥20,785 million in the previous fiscal year), partly due to recording of structural reform cost.

- 29 -

(Reference)

Net sales by company, store and product of the Department Store Business (Japanese GAAP)
are as follows.

Net sales by company and store of the Department Store BusinessCompany / Store
Amount(Millions of yen)
Year-on-year changes

Composition%%

Daimaru Matsuzakaya Department Stores Co. Ltd.
Daimaru
Osaka Shinsaibashi store

52,8839.5

30.3

Osaka Umeda store

41,227

7.4

8.7

Tokyo store

47,615

8.6

22.9

Kyoto store

52,433

9.4

11.2

Kobe store

70,16012.6

19.4

Suma store

6,549

1.2

(4.9)

Ashiya store

4,173

0.8

22.1

Sapporo store

49,376

8.9

18.3

Shimonoseki store
Sub total

8,410

1.5

3.7

332,830

59.9

17.5

Matsuzakaya
Nagoya store

103,984

18.7

20.0

Ueno store

20,894

3.8

15.4

Shizuoka store

17,0883.1

15.1

Takatsuki store

5,179

0.9

(11.6)

Toyota store

4,153

0.7

(18.1)Sub total

151,299

27.2

15.9

Corporations, head office, etc.

21,857

3.9

9.2

Total

505,987

91.0

16.6

The Hakata Daimaru, Inc.

41,5237.5

18.6

Kochi Daimaru Co., Ltd.

8,277

1.5

4.1

56

0.0

−

555,845

100.0

16.5

Adjustments
Total- 30 -

Net sales by product of the Department Store Business
Product
Amount(Millions of yen)
Year-on-year changes

Composition%%

Men’s clothing andhaberdashery

31,885

5.7

12.6

Ladies’ clothing andhaberdashery

176,668

31.8

23.4

Children’s clothing andhaberdashery

6,358

1.1

(5.3)

Kimono, bedding and otherclothing

5,630

1.0

0.8

Accessories

38,882

7.0

15.7

Furniture

4,288

0.8

14.5

152

0.0

(47.6)

Home appliancesHousehold goods

14,639

2.6

8.8

Food products

130,756

23.5

11.7

Food halls and cafes

10,895

2.0

16.3

General goods

100,349

18.1

21.0

Services

1,938

0.3

26.6

Other

33,343

6.1

7.5

56

0.0

–

Adjustments

Total
555,845100.0
16.5(Notes) 1. Effective from the fiscal year ended February 28, 2022, sales of the Corporate Sales Division and revenue
attributable to the head office, which had been included in the relevant stores, have been presented separately as
Corporations, head office, etc. Percentage changes year on year have been calculated by restating the results ofthe fiscal year ended February 28, 2021.
2. Effective from the fiscal year ended February 28, 2022, real estate lease revenue from GINZA SIX and thetenants around department stores, etc., which had been included in the Real Estate Business, has been included in
Corporations, head office, etc. and the relevant stores, respectively. Percentage changes year on year have been
calculated by restating the results of the fiscal year ended February 28, 2021.
3. The Matsuzakaya Toyota store closed on September 30, 2021.
4. Daimaru Matsuzakaya Department Stores Co. Ltd. merged with and absorbed Daimaru Matsuzakaya Sales
Associates Co. Ltd. on September 1, 2021. Year-on-year changes have accordingly been calculated byretrospectively adjusting comparative figures for the previous year.

- 31 -

SC Business
Revenue of ¥52,556 million (-5.2% YoY), operating profit of ¥2,055 million (operating loss of¥6,968 million in the previous fiscal year)<Reference data>
Gross sales of ¥219,172 million (+11.9% YoY), business profit of ¥3,844 million (+281.3% YoY)
Adverse circumstances in the business environment persisted as was the case with the Department
Store Business, amid a situation where the spread of COVID-19 resulted in suspended store operations,shortened operating hours, and restrictions imposed on entrance to entertainment venues.
Amid those circumstances, we sought to advance customer communications through initiatives that
included digitalizing customer contact points particularly in terms of expanding app membership in
partnership with our tenants, strengthening the “PARCO ONLINE STORE,” and enhancing app
payment functions. In terms of store rebranding, we undertook renovation centered on our flagshipstores including Urawa PARCO, Sendai PARCO, and Fukuoka PARCO, and we actively operated popup stores that are highly distinctive to luxury brands at Shibuya PARCO. In addition, we arranged eventsenlisting collaboration with popular characters and furthermore held anniversary events at Shibuya andShinsaibashi PARCO.
As a new business in the area of wellness, we participated in the development and operation of
medical malls and opened the 1st “Welpa” new-concept medical wellness mall in Shinsaibashi PARCO
in November.
As a result of various measures including those mentioned above, revenue from store operations
increased but revenue overall decreased by 5.2% year on year to ¥52,556 million due to transfer of allshares of NEUVE A Co., Ltd. in the specialty store business in June. Operating profit increased
substantially to ¥2,055 million (operating loss of ¥6,968 million in the previous fiscal year), partly due
to a rebound with respect to store closure-related expenses incurred in the previous fiscal year.

- 32 -

(Reference) Tenant transaction volume (on a gross basis) by PARCO store in the SC Business is as follows.
Tenant transaction volume by PARCO store in the SC BusinessYear-onyearchanges(Millions of yen)

Composition

Sapporo PARCO

7,965

%
3.7

% Shintokorozawa
12.9 PARCO

8,131

%
3.8

%
2.3

Sendai PARCO

14,8687.0

9.0 Tsudanuma PARCO

9,313

4.4

6.8

Urawa PARCO

23,59511.1

11.0 Hibarigaoka PARCO

6,124

2.9

4.5

Ikebukuro PARCO

16,3137.7

12.8 Matsumoto PARCO

3,986

1.9

7.4

5,261

2.5

27.0

Total of community
complex group27,556

13.0

5.0

5,947

2.8

Total of city and11.1 community complex
groups212,604

100.0

17.3

Shibuya PARCO

17,0728.0

43.7

Kinshicho PARCO

6,952

3.3

9.8

Chofu PARCO

15,2187.2

5.8

Shizuoka PARCO

7,621

3.6

9.4

Nagoya PARCO

22,718

10.7

9.7

Shinsaibashi PARCO

13,6326.4

230.7

Hiroshima PARCO

10,740

5.1

6.3

Fukuoka PARCO

17,1398.1

17.9

PARCO_ya Ueno
Kichijoji PARCO

Store

AmountCompositionYear-onyearchangesAmountStore

Total of city complex
185,048
87.0
19.4
group
(Notes) 1. The tenant transaction volume represents the total amount of tenant transactions at PARCO stores.
2. Shinsaibashi PARCO opened on November 20, 2020.
3. Effective from the fiscal year ended February 28, 2022, results of the 1st basement and cinema complex of Ueno
Frontier Tower are managed as the SC Business. Accordingly, results of the 1st basement and cinema complex are
included in the current results of PARCO_ya Ueno but not in its previous year results.

Developer Business
Revenue of ¥50,633 million (-5.9% YoY), operating profit of ¥4,711 million (+137.7% YoY)
<Reference data>
Gross sales of ¥53,794 million (+5.9% YoY), business profit of ¥3,134 million (+10.3% YoY)
We promoted use of our existing properties on the basis of the Real Estate Business having been
consolidated into PARCO in the previous fiscal year. This involved opening a commercial facility at
the former site of a Matsuzakaya distribution center in March while also engaging in non-commercial
multi-purpose development, and furthermore selling off non-business assets. In July, we decided to open
stores in a new building (formerly Kumamoto PARCO) in central Kumamoto.
Meanwhile, our efforts to develop the Nagoya Sakae area to make it more appealing involved
promoting development of Nishiki 3-chome District 25 (tentative name), slated for completion andopening in 2026.
As a result of various measures including those mentioned above, along with factors that include rent
concessions associated with business suspension, a backlash effect with respect to prior special demandfor building interior work, and reconsideration of postponed work order schedules, revenue was ¥50,633
million, down 5.9% year on year. However, operating profit was ¥4,711 million, up 137.7% year on
year, partly as a result of recording gain on sales of non-current assets.
- 33 -

Payment and Finance Business
Revenue of ¥11,037 million (+22.2% YoY), operating profit of ¥1,970 million (+367.8% YoY)
<Reference data>
Gross sales of ¥14,556 million (+26.6% YoY), business profit of ¥1,906 million (+380.4% YoY)
In the payment business, we worked to maintain and expand the customer base through initiatives
that included updating cards in the previous fiscal year and introducing a new points program (QIRA
Point). We also achieved geographic expansion with respect to the network of affiliated stores andinitiated operations such as those involving mutual exchange of customers among Group stores.
In the finance business, we integrated the insurance agency business within the Group and started
offering family trust service in seeking to expand into new financial products.
As a result of various measures including those mentioned above, revenue was ¥11,037 million, up
22.2% year on year primarily due to recovery in transaction volume handled by department stores andincreased revenues from annual membership fees associated with updating cards. Meanwhile, operating
profit was ¥1,970 million, up 367.8% year on year.
Other
Revenue of ¥61,755 million (-1.3% YoY), operating profit of ¥1,199 million (-30.5% YoY)
<Reference data>
Gross sales of ¥73,246 million (-3.1% YoY), business profit of ¥1,252 million (-24.3% YoY)
In the electronic devices division and automotive components division of Daimaru Kogyo, Ltd.,
which is engaged in the wholesale business, revenue decreased amid tight supply of semiconductors.
Meanwhile, Dimples’ personnel recruitment business achieved an increase in revenue in part due torecovery of business involving its client facilities.
As a result of the above, revenue was ¥61,755 million, down 1.3% year on year, and operating profit
was ¥1,199 million, down 30.5% year on year.
Dimples’ has been removed from the scope of consolidation upon partial sale of its shares at the endof February.

- 34 -

(2) Explanation of financial position(Assets, liabilities, and equity as of February 28, 2022)
Total assets as of February 28, 2022 were ¥1,192,907 million, down ¥70,815 million compared with
February 28, 2021. Total liabilities were ¥830,787 million, a decrease of ¥68,591 million comparedwith February 28, 2021. Interest-bearing liabilities (including lease liabilities) were ¥502,109 million,
down ¥60,706 million compared with February 28, 2021, as a result of the Company having taken steps
to optimize cash and deposits on hand secured to provide for effects of the COVID-19 pandemic, andhaving proceeded with repayment.
Total equity was ¥362,120 million, a decrease of ¥2,223 million compared with February 28, 2021.
(Cash flow position)
The balance of cash and cash equivalents (hereinafter “cash”) as of February 28, 2022 was ¥93,278
million, down ¥35,647 million compared with February 28, 2021.
Cash flow positions in the current fiscal year and the factors for these are as follows.
Net cash provided by operating activities was ¥49,866 million. In comparison with the previous fiscal
year, despite profit before tax having returned to profitability, cash provided decreased by ¥6,605
million, largely due to an increase in trade receivables (decrease of cash provided).
Net cash used in investing activities was ¥5,289 million. In comparison with the previous fiscal year,
cash used decreased by ¥15,581 million, largely due to proceeds from sales of investment property andsubsidiary shares, in addition to a decrease in purchase of property, plant and equipment.
Net cash used in financing activities was ¥80,392 million. In comparison with the previous fiscal
year, although there were proceeds from issuance of bonds, cash provided decreased by ¥139,119
million, largely due to the rebound after fund raising for COVID-19 measures carried out in the previous
year.
(3) Status of capital investment
The basic approach taken regarding the Group’s recurring capital investment is to keep suchinvestment within the scope of the amount of depreciation. In the current fiscal year, total capital
investments were ¥21,083 million, as a result of curtailing investments, excluding recurring investment.
(i) Major facilities completed during the current fiscal year
Mainly, in the Department Store Business this included investment in refurbishment of sales floors
at the Daimaru Kobe store, and in the Developer Business this included opening of a commercial facility
at the former site of a Matsuzakaya distribution center.
(ii) New establishments and expansions of major facilities with ongoing construction works during thecurrent fiscal year
Not applicable.
(iii) Sales, removals and losses of major non-current assets
Not applicable.
(4) Status of procurement
The Group’s basic policy is to source funds needed for business activities using funds generated by
the Group. Moreover, when the need arises for business investment or other expenditures, the holding
company spearheads efforts to procure such funds mainly by issuing bonds and borrowing fromfinancial institutions, with consideration placed on maintaining financial soundness.
The Group subsidiaries do not procure funds from financial institutions, but instead we promotestreamlined means of procuring Group funds by seeking necessary funds through intra-Group financing
using a cash management system.
For the current fiscal year, based on the above policy, we procured ¥30,000 million (of which,¥15,000 million involved sustainability bonds) through issuance of unsecured straight bonds.
- 35 -Meanwhile, we gradually embarked on efforts to optimize cash and deposits on hand secured to provide
for effects of the COVID-19 pandemic, and made progress on repayment of commercial paper of¥55,000 million and long-term borrowings of ¥17,100 million. As a result, our balance of interestbearing liabilities (excluding lease liabilities) decreased by ¥42,200 million compared to the end of theprevious fiscal year to ¥317,700 million. We also scaled back the commitment line to ¥200,000 million,a decrease of ¥100,000 million.
(5) Issues to be addressed
For fiscal 2021, which constituted the initial year of the Medium-term Business Plan, whereas ourrecovery in earnings results remained moderate relative to initial estimates amid ongoing proliferationof COVID-19, we achieved some success with respect to our three key strategies particularly in termsof digitalizing customer contact points and prioritizing investing in our flagship stores, developing newcontent, and promoting management structure reforms.
On the other hand, we have been encountering an increasingly uncertain business environment amid
prolonged effects of the pandemic and rising tensions in international affairs, with such factors in turn
giving rise to soaring raw material costs and supply-side constraints. In particular, this situation calls
for us to take action that includes strengthening our response to risk such as “changes in consumer
behavior due to COVID-19” and “decline of existing business models,” pursuing business model
reforms with respect to our existing businesses, and furthermore heightening our effectiveness looking
toward enabling the Group to achieve sustainable growth.
Meanwhile, corporations are intensively urged to tackle and address issues regarding theenvironment, society, and human rights through their business activities, in addition to achieving
economic value, amid a scenario of drastically changing social structures and consumption patterns.
The Company regards such structural changes as opportunities for corporate transformation andaccordingly strives to increase its medium- to long-term corporate value and enable its stakeholders toachieve the notion of a “Well-Being Life.” This involves seeking business growth and creating business
opportunities by promoting sustainability management, in addition to our persisting efforts in areas that
include reducing environmental burden and seeking solutions to social challenges.
◆ Accelerating implementation of key strategies and management structure reforms looking
toward “complete recovery” and “regrowth”
During fiscal 2022, the second year of the Medium-term Business Plan, we seek to take a solid step
toward achieving complete recovery. To such ends, we will steadily derive results from investment
concentrated toward our key strategies and initiatives in our existing businesses such as the Department
Store and SC businesses, while striving to increase profitability by promoting management structurereforms in part by reducing fixed costs.
Meanwhile, we will set a clear trajectory toward “regrowth” with our sights set on the year 2030
amid heightening importance of business portfolio transformation due to changes in the businessenvironment. This will involve seeking growth in the non-retail realm particularly in our Developer
Business and Payment and Finance Business by making the most of the Group’s management resources.
Beginning this fiscal year, we have sought to strengthen our framework for formulating and promoting
management strategies that include the “business portfolio transformation,” “Group Corporate Real
Estate (CRE),” and “Group digital” strategies under our holding company organization. In so doing, we
will carry out initiatives from the perspective of pursuing overall optimization and synergies. This will
involve picking up the pace in realizing our strategic aims in terms of extending each of the key
strategies by strengthening our alliances with the respective operating companies and other companies,
considering new fields of business from a creating shared value (CSV) perspective, and concentrating
allocation of management resources.
Accelerating implementation of the three key strategies and management structure reforms
1)

Real x digital strategy

We will transform the business model into one that provides new experience value through the useof digital technologies originating from brick-and-mortar stores and human resources. We will work to- 36 -

increase the attractiveness of our stores through investment concentrated toward the flagship stores of
the Department Store and SC businesses and expand business using online platforms, in order to achieve
quick recovery of earnings under the Medium-term Business Plan.
Moreover, in step with promoting strategies in our respective businesses, we will engage in an“offense-oriented digital strategy” drawing on alliances with our respective businesses. This will
involve formulating a Group customer strategy enlisting integration of our customer database andhastening mutual exchange of customers in our key areas.
(i) Increase the attractiveness of stores•••

We will take steps to establish competitive advantages in each of our business locations byconcentrating on enhancing key categories including luxury items, art, and watches centered on ourflagship department stores. Meanwhile, we will more swiftly address market changes that havebecome increasingly apparent due to the COVID-19 pandemic, in part by streamlining sales floorsthat handle practical merchandise.
We will promote reforms of the SC business model through initiatives that involve undertaking
investment concentrated toward our key stores such as Ikebukuro PARCO and Nagoya PARCO,
engaging in merchandising development to replace the conventional fashion zone format, andbringing in new tenants to address market changes in each location.
We will seek to strengthen alliances through initiatives that include having our department stores
and PARCO locations hold collaborative events in the Shinsaibashi and Nagoya areas.

(ii) Expand online business•We will strengthen our original OMO business originating from brick-and-mortar stores. This will
involve having our department stores set up “DEPACO” online stores handling cosmetics integrated
with stores and enhance e-commerce products, and having PARCO locations renovate online storesand facilitate mutual exchange of customers between physical stores and online platforms inpartnership with our tenants.

2) Prime life strategy
We will strengthen our proposals for “consumers who enjoy fulfilling, sustainable lifestyles,” whichis the aim of our prime life strategy. Under the Medium-term Business Plan, we will engage in initiatives
for developing new products and services and prompting evolution of communication with ourcustomers using digital technologies, largely based on department store gaisho (out-of-store sales).
At the same time, we will take steps to realize the medium- to long-term strategies of the Payment
and Finance Business, positioned as a core business for achieving “regrowth.”(i) Develop new products and services•

Our department stores will engage in efforts that involve deepening our mainstay categories,
identifying new content for serving the affluent market segment, and enhancing loyalty programs.
Meanwhile, the Payment and Finance Business will work to upgrade its insurance-related financial
products through alliances with other companies.

(ii) Evolve communication with customers•

Our department stores will develop more extensive customer relationship management (CRM)
practices. This will involve prompting evolution of gaisho activities using digital technologies inpart by enlisting our loyal customer-exclusive website and online customer services, and identifying
potential customers using data analysis. In addition, the Payment and Finance Business will
strengthen its in-person and online proposals in alignment with customers’ life stages.

(iii) Achieve medium- to long-term strategies of the Payment and Finance Business•We will work to achieve strategies of the Payment and Finance Business from a medium- to longterm perspective and will strengthen its business foundations through efforts that involve building
Group payment infrastructure, attaining geographic expansion with respect to the network ofaffiliated stores, and developing services that provide substantial added value.

- 37 -

3)

Developer strategy

Under our developer strategy, which is positioned as a driver of growth toward achieving “regrowth,”
we will carry forward initiatives of fiscal 2021 in terms of promoting development projects in theGroup’s key areas and building foundations for business growth.
In addition, we will formulate and promote medium- to long-term business strategies anddevelopment plans with our sights set on the year 2030 by strengthening alliances with the holding
company and operating companies.
(i) Promote area-specific development projects•

We will make effective use of our existing properties, continue to promote development projects in
Nagoya’s Sakae area, and promote development plans in the Group’s key locations such as Osaka’s
Shinsaibashi area.

(ii) Strengthen business foundations•

We will work to strengthen our business foundations by undertaking asset replacement, organizing
and embarking on management of a private subscription fund, and establishing a consignment
framework for the asset management business.

(iii) Formulate and promote medium- to long-term business strategies and development plans•

We will help create bustling towns underpinned by coexistence with local communities while
formulating and promoting medium- to long-term business strategies and development plans with afocus on centrally managing and making sophisticated use of the Group’s asset holdings.

4)

Management structure reforms

We will make steady progress in implementing our three key strategies and management structurereforms consisting of our most important measures for achieving “complete recovery” in fiscal 2023.
Beginning in fiscal 2022, we will develop a system for enabling us to engage in initiatives focused on
tracking progress of each of priority measures and promoting such measures.
(i) Reduce fixed costs (¥10,000 million lower than in fiscal 2019)•

In addition to results of our organizational and personnel structure reforms in the current fiscal year,
we will review our cost structure through efforts that involve reorganizing the Group’s offices andextending Group-wide purchasing of materials and supplies.

(ii) Increase management efficiency and asset efficiency•

We will improve management efficiency by narrowing our business foundations based on future
prospects and growth potential. We will also increase asset efficiency by identifying non-businessassets.

◆ Strengthen management foundations to support achievement of medium- to long-term growth
We will work to strengthen management foundations to support achievement of medium- to longterm growth. In particular, we will enhance our human resource strategy largely by realizing
sustainability management and undertaking investment with priority on human resources who create
new value, amid a highly uncertain business environment.
1)Group human resource strategy

We will bolster our investment in human capital through initiatives that include strengthening
recruitment and developing skills of highly specialized professionals based on our business portfoliotransformation and key strategies, early-stage identification and development of management personnel
who will serve as future leaders, encouraging active participation of women, and promoting health andproductivity management. In addition, we will furthermore assign each and every employee to positionsaligned with their commitment, motivation, and capabilities, and will facilitate personnel interaction on
a Group-wide basis. These initiatives will underpin efforts that involve actively embracing diversity,
giving rise to a corporate culture unencumbered by stereotypes, and serving as a “Human Resource- 38 -

Development Company” that seeks to enable individuals and organizations to achieve sustainablegrowth.
2)Group systems strategy

We will provide support for promoting digital strategies in each of our businesses while seeking tostandardize and streamline our administrative systems in part by rebuilding our backbone systems toincrease the sophistication of management and administration from the perspective of overall
optimization. In addition, we will promote information technology governance by ensuring information
security in our maintenance of next-generation networks and cloud computing environments, enhancing
measures for business continuity, and engaging in centralized management of investment planning anddevelopment processes.
3)Group financial strategy

We will strive to improve our financial standing and create free cash flows by taking a flexible
approach that involves reducing interest-bearing liabilities and selling non-business assets, while
monitoring effects of the spread of COVID-19 on our operations. In addition, we will seek to steadilytransform or business portfolio by developing more sophisticated management and administration,
which will involve redoubling our efforts to improve our rate of return on invested capital (ROIC) ineach of our businesses.
4)

Strengthening corporate governance

We will develop more sophisticated corporate governance practices by speeding up management
decision-making and execution toward achieving medium- and long-term growth, and by further
strengthening the oversight function of the Board of Directors separately from business execution.
(6) The Group’s sustainability initiatives● Sustainability Policy (excerpt): With People, with Local Communities, with Environment
The society we live in is facing various social issues inside and outside Japan, including abnormal
weather, water resource crises, resource depletion, widening disparity, underemployment, and humanrights issues.
Daimaru and Matsuzakaya, which are the cornerstones of the Group, have carried out businessactivities in their long history spanning 300 to 400 years under the corporate credos “Service before
profit” and “Abjure all evil and practice all good,” representing their commitment to pursuing the rightpath. Our Group Vision “Create and Bring to Life ‘New Happiness’” has been newly established basedon these concepts. Now we are engaged in business activities aiming at realization of happy future of
our customers, always bearing life of each and every one of them in mind.
We have many places where we communicate with customers, including retail stores. These places
allow various people to get together and meet each other, including customers, employees, business
partners, and residents in the local community. Local communities where people rooted in play a vitalrole in maintaining these communication places rich. Such communities should be sustained as
touchpoints brimming with energy at all times. To this end, we believe it important to pass down the
global environment that supports these whole activities smoothly to the future generations. This means
that, in order for us to create and bring to life new happiness as we aspired, it is important to maintainthe communication places; and this can only be achieved with sustainable society.
We are committed to fulfilling our environmental and social responsibilities to customers toward theachievement of a sustainable society, and will furthermore pursue the creation of new happiness of lifeof each and every stakeholder. At the same time, we will continue achieving sustainable growth bystrengthening corporate governance to tirelessly continue these initiatives.
* Sustainability Policy (unabridged)(www.j-front-retailing.com/english/sustainability/way_to_think.html)● Sustainability Management and “Well-Being Life”- 39 -

In its Medium-term Business Plan launched in fiscal 2021, the Company articulated the notion ofsustainability management and cited “Well-Being Life” as the goal of its Group Vision, “Create andBring to Life ‘New Happiness’.”
The Company’s notion of Well-Being Life embodies the realization of life that realizes not only
conventional material and economic affluence, but also spiritual (intellectual and cultural), physical andsocial wealth, as well as the enriched environment surrounding them. We will promote efforts to realize“Well-Being Life” by combining sustainability with our strengths, while valuing the opportunities tointeract with our customers and other stakeholders.
● Seven materiality issues (key issues)
We have identified seven materiality issues for promoting sustainability management and realizing“Well-Being Life.”
Upon having identified both risks and opportunities with respect to each materiality issue, we will
respond to the risks while creating business opportunities, and accordingly aim to simultaneously
realize both social and economic value based on the notion of creating shared value (CSV).
Materiality
Realization of customers’
healthy/safe/secure life

With people

With local communities

With environment

The Company’s commitment to realization of a sustainable society
Realizing a future-oriented Well-Being Life that satisfies the mind and body of ourcustomers
Building safe, secure and resilient stores for the future

Promotion of diversity &inclusion

Realizing a highly diversified society where everyone recognizes each other’s
diversity and flexibly demonstrates his/her individuality

Realization of work-life
integration

Realizing Well-Being Life for the employees and their families through new work
styles for the future to realize diversity and flexibility

Management of the entire
supply chain

Realizing decarbonized society throughout the entire supply chain created together
with suppliers
Realizing sustainable supply chain created together with suppliers
Realizing Well-Being Life in which we, together with suppliers, protect the humanrights and health of the people working along the supply chain

Coexistence with local
communities

Building affluent future-oriented communities together with local residents, where
people gather centered on our stores

Realization of
decarbonized society

Leading decarbonized society and preparing a global climate for the next
generation

Promotion of circular
economyRealizing a sustainable global environment for the future and growth as a company
through the promotion of circular economy* Details of the Company’s seven materiality issues is available via the link below.
(https://www.j-front-retailing.com/english/sustainability/materiality.html)- 40 -

(7) Status of assets and profit or loss
Changes in assets and profit or loss of the corporate group(Millions of yen, unless otherwise stated)
International Financial Reporting Standards (IFRS)
12th fiscal year
(Fiscal 2018)

13th fiscal year
(Fiscal 2019)14th fiscal year
(Fiscal 2020)

15th fiscal year
(Fiscal 2021)

Gross sales

1,125,153

1,133,654

769,453875,281

Revenue

459,840

480,621319,079

331,484

Business profit

45,51445,363

2,366

11,718Operating profit

40,89140,286(24,265)

9,380

Operating profit/revenue

8.9%

8.4%

(7.6)%

2.8%

Profit before tax

42,126

37,161(28,672)

6,190

Category

Profit attributable to owners of parent
Total assets

27,35821,251(26,193)

4,321

1,029,573

1,240,308

1,263,722

1,192,907

Total equity

468,485399,681364,343

362,120

Equity attributable to owners of parent

412,700

387,188352,171

350,368

40.1

31.2

27.9

29.4

174,378[–]478,773[220,497]

562,815[202,885]

502,109[184,394]

Ratio of equity attributable to owners of parent to total assets
Interest-bearing liabilities[Of which, lease liabilities]
Cash flows from operating activities

34,87073,35856,47149,866

Cash flows from investing activities(26,836)(49,559)(20,870)(5,289)

Free cash flows

8,034

23,79935,601

44,577

Cash flows from financing activities(21,274)(14,829)58,727(80,392)

Cash and cash equivalents at end of period

25,65934,633

128,925

93,278

Profit/equity attributable to owners of parent (ROE)

6.8%

5.4%

(7.1)%

1.2%

Operating profit/total assets (ROA)

4.0%

3.2%

(1.9)%

0.8%

Return on invested capital (ROIC)

–

–

0.2

1.2

104.5581.19(100.03)16.50

Equity attributable to owners of parent per share (Yen)

1,576.68

1,479.07

1,344.91

1,337.29

Price earnings ratio (PER)

11.79%

14.13%(10.17)%58.29%

Interim dividend (Yen)

17.00

18.00

9.00

14.00

Year-end dividend (Yen)

18.00

18.00

18.00

15.00

Dividend payout ratio

33.5%

44.3%

–%

175.7%

Dividends/equity attributable to owners of parent

2.2%

2.4%

2.0%

2.2%

Basic earnings per share (EPS) (Yen)(Notes) 1. Profit attributable to owners of parent, operating profit and business profit after tax are used to calculate ROE,
ROA and ROIC, respectively.
2. Gross sales are calculated by converting certain transactions recognized as revenue under IFRS on a net basis toamounts on a gross basis. Specifically, we converted sales from purchase recorded at the time of sale (shoka
shiire) of the Department Store Business and Other (Daimaru Kogyo) to a gross amount and the net amounttransactions of the SC Business to tenant transaction volume (gross basis). Business profit is calculated bydeducting cost of sales and selling, general and administrative expenses from revenue.

- 41 -

(8) Status of significant parent company and subsidiaries(i) Relationship with the parent company
No items to report(ii) Status of major subsidiaries
Company nameShare capital

Daimaru Matsuzakaya Department Stores
Co. Ltd.

10,000

The Hakata Daimaru, Inc.
Kochi Daimaru Co., Ltd.

(Millions of yen, unless otherwise stated)
Ratio of ownershipby the Company
Major businesses
(%)
100.0

Department Store Business

3,037

69.9

Department Store Business

300

100.0

Department Store Business

34,367100.0

SC Business, Developer
Business

S$4 million

100.0

SC Business

100

100.0

Space engineering andmanagement business

100

100.0

Design and construction
contracting

10

100.0

Internet-related business

10

100.0

Real estate management,
consulting

JFR Card Co., Ltd.

100

100.0

Payment and Finance Business

Daimaru Kogyo, Ltd.

PARCO Co., Ltd.
Parco (Singapore) Pte Ltd
PARCO SPACE SYSTEMS Co., Ltd.
J. Front Design & Construction Co., Ltd.
PARCO Digital Marketing Co., Ltd.
JAPAN RETAIL ADVISORS Co., Ltd.

1,800

100.0

Wholesale business

Daimaru Kogyo International Trading(Shanghai) Co., Ltd.

US$2 million

100.0

Wholesale business

Daimaru Kogyo (Thailand) Co., Ltd.

THB202 million

99.9

Wholesale businessTaiwan Daimaru Kogyo, Ltd.

NT$60 million

100.0

Wholesale business

Consumer Product End-Use ResearchInstitute Co., Ltd.

100

100.0

Merchandise test and quality
controlAngel Park Co., Ltd.

400

50.2

Parking

100

100.0

Commissioned back-officeservice, leasing, parking

10

100.0

Information service

JFR Service Co. Ltd.
JFR Information Center Co., Ltd.
Daimaru Matsuzakaya Tomonokai Co., Ltd.

Specified prepaid transaction
service(Notes) 1. PARCO CO., LTD. transferred all the shares of NEUVE A Co., Ltd. on June 30, 2021.
2. Daimaru Matsuzakaya Department Stores Co. Ltd. merged with and absorbed Daimaru Matsuzakaya Sales
Associates Co. Ltd. on September 1, 2021.
3. The Company removed Dimples’ Co., Ltd. from the scope of consolidation upon transfer of 90% of its shares on
February 28, 2022.
100

100.0

(iii) Matters relating to specified wholly owned subsidiaries(Millions of yen)
Name

Address

Total book value

Total assets of theCompany

Daimaru Matsuzakaya
Department Stores Co. Ltd.

18-11, Kiba 2-chome, Koto-ku,
Tokyo202,109641,307

PARCO Co., Ltd.

28-2, Minami-Ikebukuro 1-chome,
Toshima-ku, Tokyo

160,581

641,307(Note) A specified wholly owned subsidiary is one where the book value of the shares of said subsidiary on the final dayof the fiscal year exceeds 1/5th of the Company’s total assets, and one whose shares are all held by the Company.

- 42 -

(9) Major businesses
The Department Store Business, the SC Business, the Developer Business, the Payment and FinanceBusiness, and Other including wholesale business, parking, and leasing, etc.
(10) Major business locations(Department Store Business)
Name

Location

Daimaru Matsuzakaya Department
Stores Co. Ltd.
Head Office
Daimaru Osaka Shinsaibashi store
Osaka Umeda store
Tokyo store
Kyoto store

Koto-ku, Tokyo
Chuo-ku, Osaka
Kita-ku, Osaka
Chiyoda-ku, Tokyo
Shimogyo-ku, Kyoto

Matsuzakaya

Chuo-ku, Kobe

GINZA SIX

Kobe store

Name

Nagoya store
Ueno store
Shizuoka store
Takatsuki store

LocationNaka-ku, Nagoya
Taito-ku, Tokyo
Aoi-ku, Shizuoka
Takatsuki, Osaka

Chuo-ku, Tokyo

Suma store

Suma-ku, Kobe

The Hakata Daimaru, Inc.

Chuo-ku, Fukuoka

Ashiya store
Sapporo store

Ashiya, Hyogo
Chuo-ku, Sapporo
Shimonoseki,
Yamaguchi

Kochi Daimaru Co., Ltd.

Kochi, Kochi

Shimonoseki store(SC Business)
Name
PARCO Co., Ltd.
Headquarters
Shibuya Head Office
Sapporo PARCO
Sendai PARCO
Urawa PARCO
Shintokorozawa PARCO
Ikebukuro PARCO
PARCO_ya Ueno (Ueno
Frontier Tower)
Kinshicho PARCO
Shibuya PARCO
Parco (Singapore) Pte Ltd

Location

Name

Location

Toshima-ku, Tokyo
Shibuya-ku, Tokyo
Chuo-ku, Sapporo
Aoba-ku, Sendai
Urawa-ku, Saitama
Tokorozawa, Saitama
Toshima-ku, Tokyo

Hibarigaoka PARCO
Kichijoji PARCO
Chofu PARCO
Tsudanuma PARCO
Matsumoto PARCO
Shizuoka PARCO
Nagoya PARCO

Nishi-Tokyo, Tokyo
Musashino, Tokyo
Chofu, Tokyo
Funabashi, Chiba
Matsumoto, Nagano
Aoi-ku, Shizuoka
Naka-ku, Nagoya

Taito-ku, Tokyo

Shinsaibashi PARCO

Chuo-ku, Osaka

Sumida-ku, Tokyo
Shibuya-ku, Tokyo

Hiroshima PARCO
Fukuoka PARCO

Naka-ku, Hiroshima
Chuo-ku, Fukuoka

Singapore- 43 -

(Developer Business)
Name

Location

Name

PARCO Co., Ltd.
Sapporo ZERO GATE
Harajuku ZERO GATE

Chuo-ku, Sapporo
Shibuya-ku, Tokyo
Kawasaki-ku,
Kawasaki ZERO GATE
Kawasaki-shi
Nagoya ZERO GATE
Naka-ku, Nagoya
Kyoto ZERO GATE
Shimogyo-ku, Kyoto
Shinsaibashi ZERO GATE Chuo-ku, Osaka
Dotonbori ZERO GATE
Chuo-ku, Osaka
Sannomiya ZERO GATE Chuo-ku, Kobe
Hiroshima ZERO GATE
Naka-ku, Hiroshima

Location

Pedi SHIODOMEBINO OKACHIMACHI

Minato-ku, Tokyo
Taito-ku, Tokyo

BINO GINZA

Chuo-ku, Tokyo

BINO SAKAE
BINO HIGASHINOTOIN
and others

Naka-ku, Nagoya
Nakagyo-ku, Kyoto

PARCO SPACE SYSTEMS Co., Shibuya-ku, Tokyo
Ltd.

PARCO Digital Marketing Co., Ltd. Shibuya-ku, Tokyo

J. Front Design & Construction Co., Chuo-ku, Osaka
Ltd.

JAPAN RETAIL ADVISORS Co., Shibuya-ku, Tokyo
Ltd.

(Payment and Finance Business)
Name

Location

JFR Card Co., Ltd.

Head Office: Takatsuki, Osaka
Office:Tokyo 3, Osaka 2, Kyoto 1, Kobe 1, Sapporo 1, Nagoya 1,
Shizuoka 1(Other subsidiaries)
Head Office: Osaka-fu 5, Nagoya 1, Shanghai 1, Thailand 1, Taiwan 1(11) Status of employees(i) Employees of the corporate group
Category

Number of employees

J. FRONT RETAILING Co., Ltd.

138

Department Store Business

2,724

SC Business

494

Developer Business

873

Payment and Finance Business

201

Other

1,159

Total
5,589
(Note) Other than the employees above, the number of dedicated employees is 1,444 and the number of fixed-term
employees is 1,115.

(ii) Employees of the Company
Number of employees

Average age

138
46.4
(Note) Other than the employees above, the number of dedicated employees is 1 and the number of fixed-term
employees is 15.

(iii) Employees of major subsidiaries
Name
Daimaru Matsuzakaya Department
Stores Co. Ltd.
PARCO Co., Ltd.

Number of
employees

Average age

2,459

48.0

691

43.8

- 44 -

(12) Status of major creditors
Major creditors of the corporate group(Millions of yen)Amount payable

Creditor
Borrowings
MUFG Bank, Ltd.

51,805Development Bank of Japan Inc.

34,256

Sumitomo Mitsui Banking Corporation

31,556

Mizuho Bank, Ltd.

12,856

Other

72,487

Sub total

202,960

Straight bonds, etc.

114,755

Total

317,715(13) Other important matters relating to current status of the corporate group
No items to report- 45 -

2. Matters relating to shares of the Company(1) Number of shares authorized:
1,000,000,000 shares(2) Number of shares issued:

270,565,764 shares(3) Number of shareholders:

155,375(4) Major shareholders
Number of shares held(Thousands of shares)

Name of shareholders

The Master Trust Bank of Japan, Ltd. (Trust Account)
Custody Bank of Japan, Ltd. (Trust Account)
Nippon Life Insurance Company
J. Front Retailing Kyoei Supplier Shareholding Association
DAIWA CM SINGAPORE LTD - NOMINEE ROBERTLUKE COLLICKThe Dai-ichi Life Insurance Company, Limited
BNYM AS AGT / CLTS NONTREATY JASDEC
JP MORGAN CHASE BANK 385781
SMBC Trust Bank Ltd. (Sumitomo Mitsui Banking
Corporation Retirement Benefit Trust Account)
JP Morgan Securities Japan Co., Ltd.
(Note)

Shareholding ratio(%)

43,781
15,163
9,828
6,344

16.56
5.73
3.71
2.40

5,439

2.05

5,158
4,308
3,207

1.95
1.62
1.21

3,204

1.21

2,909

1.10

Although the Company holds 6,264 thousand shares of treasury shares, the Company is excluded from the above
major shareholders. Shareholding ratio is calculated by deducting the said treasury shares. Treasury shares do notinclude shares of the Company owned by the officer remuneration BIP trust.

(5) Summary of shares that are granted to the officers of the Company as compensation for the
performance of duties during the current fiscal year
Stock-based remuneration that is granted during the current fiscal year is as follows.
Number of granted persons

4
[2]
–
4

Director[of which, Outside Director]
Executive Officer
Total(Notes)Number of shares

25,100[7,600]–25,1001. The number of shares granted to Directors who concurrently serve as Executive Officers as compensation for
performance of duties during the term of the Executive Officer is shown in the Executive Officer row.
2. The aforementioned number of granted persons and the number of shares include the officers who retired during
the current fiscal year and the shares granted to those officers.
3. The shares granted to those who were directors during the current fiscal year as compensation for the performanceof duties were “Restricted Stock (non-performance linked stock-based remuneration)” that is not linked toperformance under the stock-based compensation plan, which were granted at the time of retirement from thedirector.
4. The number of shares above amounts to shares issued to each Director. 25,494 shares among the shares whoserights are granted to each Director will be provided in cash in the amount equivalent to the amount converted
within the Trust pursuant to the share granting rules related to the stock-based remuneration system.

- 46 -

3. Matters relating to corporate officers(1) Names, etc. of Directors
Position in the Company

Name

Attendance at
LimitedAreas of responsibility in the Company and the meetings
liability
important concurrent positions outside the of the Board ofagreements
Company
Directors(Note 4)(Note 3)

Director

Director

YAMAMOTO
Ryoichi

Chairperson of Board of Directors
Member of Nomination and Remuneration
Committees
Outside Director of Daido Steel Co., Ltd.
Outside Director of NORITAKE CO.,LIMITED

HAMADA Kazuko(Note 1)
Member of Audit Committee

100.0%
15/15

Yes

100.0%
12/12

Yes

YAGO
Natsunosuke

Chairperson of Nomination Committee andmember of Remuneration Committee
Outside Director of SUBARUCORPORATION
Director of PARCO Co., Ltd.

100.0%
15/15

Yes

HAKODA Junya

Chairperson of Audit Committee
Member of the Ethics Committee of theJapanese Institute of Certified Public
Accountants
Chairperson of the Committee on Training
and Research for Outside Officers,
Japanese Institute of Certified Public
Accountants

100.0%
12/12

Yes

UCHIDA Akira

Chairperson of Remuneration Committee
and member of Nomination Committee
Outside Director of Yokogawa Electric
Corporation
Director of Daimaru Matsuzakaya
Department Stores Co. Ltd.

100.0%
15/15

Yes

SATO Rieko(Note 2)

Member of Audit Committee
Partner of Ishii Law OfficeOutside Director (Audit and Supervisory
Committee Member) of Dai-ichi Life
Holdings, Inc.
Outside Director (Member of the Audit andSupervisory Committee) of NTT DATACORPORATION
Outside Audit & Supervisory Board
Member of Mitsubishi Corporation
Director of Daimaru Matsuzakaya
Department Stores Co. Ltd.

100.0%
15/15

Yes

SEKI Tadayuki

Member of Audit Committee
Outside Director of VALQUA, LTD.
Outside Director of JSR Corporation
Outside Statutory Auditor of Asahi MutualLife Insurance Company
Director of PARCO Co., Ltd.

100.0%
15/15

Yes

Director (Outside)

KOIDE Hiroko

Member of Nomination and Remuneration
Committees
Outside Director of Mitsubishi Electric
Corporation
Outside Director of J-OIL MILLS, Inc.

100.0%
12/12

Yes

Director (President andRepresentative
Executive Officer)

YOSHIMOTO
TatsuyaDirector (Outside)

Director (Outside)

Director (Outside)

Director (Outside)

Director (Outside)

100.0%
15/15- 47 -

Position in the Company

Name

Attendance at
LimitedAreas of responsibility in the Company and the meetings
liability
important concurrent positions outside the of the Board ofagreements
Company
Directors(Note 4)(Note 3)

Director (Senior
Managing Executive
Officer)

SAWADA Taro

100.0%
15/15

Director (Senior
Managing Executive
Officer)

MAKIYAMA Kozo

100.0%
15/15

Director (Managing
WAKABAYASHI
100.0%
Executive Officer)
Hayato15/15(Notes) 1. HAMADA Kazuko is recorded under the name of HIMENO Kazuko in the family register.
2. SATO Rieko is recorded under the name of KAMATA Rieko in the family register.
3. Stated are the number of the meetings of the Board of Directors attended and number of the meetings of theBoard of Directors held during the individual’s tenure this fiscal year (Details of attendance at each committee
meeting are given in “7. Operations of each Committee.”)
4. The Company enters into agreements limiting liability for damages such that are stipulated in Paragraph 1, Article
423 of the Companies Act, provided for in Paragraph 1, Article 427 of the said Act, with the relevant individuals(marked as “Yes” in the “Limited liability agreements” column). These agreements limit the amount of their
liability for damages to the higher of either ¥12,000,000 or the minimum amount of liability such that is stipulated
in Paragraph 1, Article 425 of the said Act.
5. The Company enters into a Directors and Officers liability insurance contract with an insurance company as
stipulated in Paragraph 1, Article 430-3 of the Companies Act. Under such an insurance contract, indemnification
will be provided for legal damages and litigation costs to be borne by the insured. The Company covers thepayment for the entire amount of the premium for all of those insured. The insurance policy covers all Directors
and Executive Officers of the Company and all Directors and Audit & Supervisory Board Members of its
subsidiaries. However, the contract does not cover any damages, etc. arising from criminal acts and violations oflaws and regulations committed by the insured knowingly what they are doing, as a measure to prevent the
impairment of the appropriateness of the execution of duties by the insured.
6. Audit Committee member HAKODA Junya has been involved in accounting audits, management consulting,and internal audits of accounting firms, etc., serving as a certified public accountant for many years. He has bothabundant experience and highly specialized knowledge in relation to corporate auditing. He also has deep insight
into finance and accounting matters.
7. Audit Committee member SEKI Tadayuki was involved in international business management and risk
management. As CFO, he has both abundant experience and highly specialized knowledge in relation to financeand accounting. He also has deep insight into finance and accounting matters.
8. Audit Committee member HAMADA Kazuko is a full-time Audit Committee member. We aim to improve theeffectiveness of audits by appointing to serve as full-time Audit Committee member an in-house Director who
does not execute business and has specialist knowledge of specific areas of our business based on a thoroughunderstanding of in-house organizations and business execution.

- 48 -

(2) Names, etc. of Executive Officers
Position in the Company

Name

President andRepresentative Executive
Officer

YOSHIMOTO
Tatsuya

Areas of responsibility in the Company and important concurrent
positions outside the Company

Senior Managing Executive
SAWADA Taro
OfficerPresident and Representative Director of Daimaru Matsuzakaya
Department Stores Co. Ltd.

Senior Managing Executive
MAKIYAMA Kozo
Officer

Representative Director, President and Executive Officer of PARCO
Co., Ltd.

Managing Executive Officer

WAKABAYASHI
HayatoManaging Executive Officer HIRANO Hidekazu

Senior Executive General Manager of Financial Strategy Unit
Director of PARCO Co., Ltd.
Senior Executive General Manager of Management Strategy Unit andin charge of Risk Management
Director of Daimaru Matsuzakaya Department Stores Co. Ltd.

Managing Executive Officer

MATSUDA
Hirokazu

Senior Executive General Manager of Human Resources Strategy Unit
and Administration Unit and in charge of ComplianceManaging Executive Officer

NAKAYAMA
TakashiSenior Executive General Manager of Group Digital Strategy Unit

Executive Officer

IMAZU Takahiro

Senior General Manager of Management Planning Division andGroup Communication Promotion Division, Management Strategy
Unit

Executive Officer

IWATA Yoshimi

Senior General Manager of Accounting and Tax Affairs Division of
Financial Strategy Unit

Executive Officer

ONO Keiichi

Senior General Manager of Structural Reform Promotion Division of
Financial Strategy Unit

Executive Officer

NINOBE Mamoru

President and Representative Director of JFR Card Co., Ltd.

President and Representative Director of J. Front Design &Construction Co., Ltd.
(Reference) A new Executive Officer was elected and appointed. Accordingly, Executive Officers’ areas of responsibility in
the Company and important concurrent positions outside the Company have been partially changed on March 1,2022 as indicated below.
New areas of responsibility in the Company and important concurrent
Position in the Company
Name
positions outside the Company
Executive Officer

KONDO YasuhikoSenior Managing Executive
MAKIYAMA Kozo
Officer

In charge of Developer Strategy
Representative Director, President and Executive Officer of PARCO
Co., Ltd.

Managing Executive Officer ONO Keiichi

Senior Executive General Manager of Management Strategy Unit andin charge of Risk Management

Managing Executive Officer
HAYASHI Naotaka(New)

Senior Executive General Manager of Group Digital UnitManaging Executive Officer

NAKAYAMA
TakashiSenior Executive General Manager of Group System UnitManaging Executive Officer HIRANO Hidekazu

In charge of Special Assignments from President
Director of Daimaru Matsuzakaya Department Stores Co. Ltd.

Executive Officer (New)KAWASE Kenji

Senior General Manager of Management Planning Division, Business
Portfolio Transformation Promotion Division, and Group
Communications Promotion Division of Management Strategy Unit

Executive Officer (New)HIRAI Yuji

Senior General Manager of CRE Planning Division of Management
Strategy Unit
Executive Officer of Parco Co., Ltd.

Executive Officer (New)

YAMAZAKI Shiro

Senior General Manager of System Planning Division of Group
System Unit

Executive Officer (New)NOGUCHI Hideki

Senior General Manager of Accounting and Tax Affairs Division of
Financial Strategy Unit

Executive Officer (New)

UMEBAYASHI
Akira

Senior General Manager of Group Human Resources Policy Division,
Group Human Resources Development Division, and Group Welfare
Division of Human Resources Strategy Unit

- 49 -

On March 1, 2021, three Executive Officers, IMAZU Takahiro, IWATA Yoshimi, and KONDO Yasuhiko, retired
from office and assumed new positions. IMAZU Takahiro assumed the positions of Executive Officer of Daimaru
Matsuzakaya Department Stores Co. Ltd. and Executive Store Manager of Daimaru Kobe. IWATA Yoshimi
assumed the position of Executive Officer of Parco Co., Ltd. in charge of the Accounting & Finance Department,
the Business Administration Department, the Accounting Coordination Department, and the Administration and
Legal Department. KONDO Yasuhiko assumed the positions of Executive Officer of Daimaru Matsuzakaya
Department Stores Co. Ltd. and President and Representative Director of GINZA SIX Retail Management Co., Ltd.

(3) Total amount of remuneration, etc. to Directors and Executive Officers

Number ofpayeesTotal amount of
remuneration,
etc.
(Millions of yen)

Totals by category of remuneration, etc.
(Millions of yen)
NonPerformance
PerformanceperformanceBasic-linkedlinkedlinked stockremuneration
stock-based
bonusesbased
remuneration
remuneration

Director

12

197

155

–

–

42

[of which, Outside Director]

[8]

[102]

[84]

–

–

[18]

Executive Officer

19

447

213

95

139

–

(Notes)

Total
31
645
368
95
139
42
1. Other than the above, the total amount of remuneration, etc. received by Outside Directors from subsidiaries of
the Company in the current fiscal year is ¥14 million.
2. In the above table, the remuneration, etc. for Directors of ¥197 million includes ¥24 million (including nonperformance-linked stock-based remuneration) paid to four Directors who held the post between March 1 andMay 27, 2021.
3. The remunerations, etc. paid to Directors who concurrently serve as Executive Officers as compensation for the
performance of duties during the term of the Executive Officers is shown in the Executive Officer row.
4. Beginning in the fiscal year ended February 28, 2018, to ensure steady execution of the Medium-term Business
Plan for realizing the Group Vision, the Company has adopted the stock-based remuneration system using a trust
for officers (a system of granting the Company’s shares to officers (in certain cases, the Company’s shares areconverted into cash within the trust and cash in the amount equivalent to their conversion value is paid) inaccordance with the officers’ rank and level of achievement of the Medium-term Business Plan, etc.) The stockbased remuneration in the above chart is the total recorded as expenses for the period under review. It is divided
into performance-linked stock-based remuneration corresponding to degree of achievement of single fiscal year
results and degree of achievement of the Medium-Term Business Plan targets, as well as non-performance-linked
stock-based remuneration for Directors who do not execute business. Actual trends with respect to financial
indicators for calculating bonuses and performance share in the current business year (consolidated operating
profit and ROE) are stated under “1. Current status of the corporate group, (7) Status of assets and profit or loss.”
Meanwhile, actual trends with respect to non-financial indicators (greenhouse gas emissions and ratio of womenin management positions) are stated in the key performance indicator targets under “1. Current status of thecorporate group, (1) Business summary and results”
5. The figure in the “Performance-linked bonuses” column represents an amount recognized as a provision(expense), factoring in the results of performance evaluation for the fiscal year ended February 28, 2022. The
actual amounts to be paid after factoring in the earnings performance assessment of each Executive Officer andamounts to be paid on an individual basis will be determined by a meeting of the Remuneration Committee
scheduled in or after April 2022.
6. The “Performance-linked stock-based remuneration” column reflects a reversal of provisions for short-term
incentives and medium-term and long-term incentives in the fiscal year ended February 28, 2021 (¥65 million
for short-term incentives and ¥356 million for medium- and long-term incentives), pursuant to the officer
remuneration system set up in alignment with the previous Medium-term Business Plan. In April 2021, however,
the Company partially revised its Officer Remuneration System, including its method for calculating theperformance-linked factor, upon taking into account contingencies with respect to earnings results having been
substantially affected by the COVID-19 pandemic. Accordingly, the Company recorded an additional provisionof ¥29 million in relation to medium- and long-term performance share to be paid in alignment with degrees ofachievement with respect to targets set for the final fiscal year of the previous Medium-term Business Plan. The
provision of ¥29 million is included in the performance-linked stock-based remuneration of ¥139 million for
Executive Officers in the above table, and also includes ¥11 million slated for payment to six Executive Officers
who held the post between March 1, 2017, and February 28, 2021.

- 50 -

(4) Outline of method for determining policy regarding decisions on amounts of remuneration, etc.
of each corporate officer or calculation method thereof, and contents of such policy(i) Policy on determining remuneration for Directors and Executive Officers
The Company established and published an Officer Remuneration Policy in April 2017. On
May 27, 2021, the Remuneration Committee with a majority of independent Outside Directors
embarked on review of the Officer Remuneration System in alignment with the new Medium-term
Business Plan to ensure that officer remuneration functions as an incentive for achieving andpromoting sustainability management. The Officer Remuneration Policy has been revised
accordingly and is now in effect.
<Basic policy for officer remuneration>
The Company’s Officer Remuneration System follows the basic approach below, aiming toachieve the objectives of realizing and promoting sustainability management (pay for purpose).
The same basic philosophy is also established by Daimaru Matsuzakaya Department Stores and
PARCO, which are major subsidiaries of the Group.
(i)Contribute to the sustainable growth of the Group and increase corporate value over the
medium to long term, and be consistent with the corporate culture.
(ii) Establish a remuneration system that facilitates the achievement of duties (mission) basedon management strategies of professional corporate managers.
(iii) Remuneration levels that can secure and retain human resources who have the “desirable
managerial talent qualities” required by the Company.
(iv) Increase shared awareness of profits with shareholders and awareness of shareholderfocused management.
(v) Enhanced transparency and objectivity in the remuneration determining process.
<How to determine remuneration levels>
To make quick responses to changes in the external environment and the market environment,
the Company uses objective remuneration survey data, and so forth, from external specialist
organizations, adopts officer remuneration levels of companies in the same industry (department
store, retailer) and companies of a comparable size (selected based on market capitalization andconsolidated operating profit) in other industries as a benchmark, and compares the remunerationlevels of its Executive Officers and Directors with the benchmark annually. The same treatment
shall apply to the Directors and Executive Officers of Daimaru Matsuzakaya Department Stores
and PARCO.
<Composition of remuneration>[Executive Officers]
Remuneration for Executive Officers shall comprise (i) “basic remuneration” (monetary
remuneration) in accordance with mission grade, (ii) “bonuses” (monetary remuneration) basedon individual evaluations conducted each business year, and (iii) “performance shares”(performance-linked stock-based remuneration, which is trust-type stock-based remuneration)linked to the consolidated performance achievement rate, etc. provided in the Medium-term
Business Plan as a stock-based remuneration system. The performance indicators of bonuses andperformance shares were selected as shown in the table below so as to achieve KPIs for the final
fiscal year of the Medium-term Business Plan and to make a healthy incentive for sustainablegrowth function.

- 51 -

Type ofremuneration
Basic
remuneration(fixed)Payment
methodPayment basis

Determined separately for each mission grade

Composition of
remuneration
Officers
President other thanPresidentMonthly
payment in cash

38.5%

45.4%

Annualpayment in cash

23.0%

27.3%

38.5%

27.3%

Base amount by mission grade × Rate of change*1*1 The rate of change is based on a calculation of scores using
the quantitative and qualitative evaluations below.
Evaluation
weights

Details
Quantitative Fiscal year’s
evaluation
financial<70%>
evaluation
Bonuses(variable)

Qualitativeevaluation<30%>

Fiscal year’s
non-financial
evaluation

Consolidated
operating profit*2

70%

Level ofachievement ofaction plan forachieving fiscal
year’s financial
evaluation

20%

Level ofachievement ofaction plan forachieving nonfinancial targets inline withmateriality issues

10%[Short-term: 40%] Base amount by mission grade × Performanceachievement factor*3*3 Calculated based on the following measures of achievement *4 Annual
Evaluation payment in
Details
stocks*5
weights
Consolidated operating profit
Performancelinked stockbased
remuneration(variable)

100%[Medium to long term: 60%] Base amount by mission grade ×
Performance achievement factor*3*3 Calculated based on the following measures of achievement *4
Evaluation
weights

Details
Financial Consolidated operating profit
indicators
ROE
<80%>
Nonfinancial
indicators
<20%>

40%
40%

Greenhouse gas reductions (Scope 1 &2 emissions)

10%

Goal achievement for ratio of womenin management positions

10%

At theexpiration of
the term ofeach Mediumterm Business
Plan in stocks*5*2 In principle, the target figures are based on consolidated financial indicators but if an officer is in charge of a certain
business, target figures for that business are used.
*4 The performance-linked factor for performance-linked stock-based remuneration is calculated by the following calculation
method: The rate of change for ratio of women in management positions is evaluated using fiscal 2020 results as thereference. Actual results = Results - fiscal 2020 results, Target = 26% - fiscal 2020 results
Performance target achievement
200% or more
0% or more, but less than 200%
Less than 0%

Performance-linked factor
2
Actual results ÷ Target
0*5 In principle, the equivalent of 50% of the Company’s shares to be issued is converted and paid as cash to provide funds forpayment of tax.

- 52 -

[Directors who do not execute business]
Remuneration for Directors who do not execute business shall consist only of fixed
remuneration, which shall be (i) “basic remuneration” (monetary remuneration) in accordancewith responsibilities and (ii) “restricted stock” (non-performance-linked stock-based remuneration,
which is trust-type stock-based remuneration), which is not linked to performance, as part of thestock-based remuneration system. Restricted stock is a system for issuing the Company’s sharesin a way that it is not linked to performance, with the objective of involving Directors who do not
execute business in management with a medium- to long-term view in order that they should
strengthen proactive and defensive governance of the Company from a different standpoint to the
Executive Officers as representatives of stakeholders. The shares are issued upon their retirementfrom office. The Company will disclose the number of shares held as the number of dilutive
potential shares until the shares are issued.
<Stock acquisition and holding>
Any shares of the Company acquired by Executive Officers as stock-based remuneration shallcontinue to be held by respective Executive Officers at least for three years from the grant date of
the shares (or at least for one year after they retire from the office of Executive Officer). The
purpose of this requirement is to deepen the common interest of shareholders and officers. In
particular, the purpose of granting shares of the Company to Executive Officers who areresponsible for business execution as remuneration in the form of performance-linked stock-based
remuneration is to provide additional incentive to them to work for the improvement of thefinancial performance and corporate value of the Company from the medium- to long-term
perspective. Directors and Executive Officers of Daimaru Matsuzakaya Department Stores and
PARCO shall adopt the same policy for their acquisition and holding of the Company’s shares.
(ii) Process for determining remuneration for Directors and Executive Officers
To ensure the appropriateness of the level and amount of remuneration, and the transparency ofdecision-making processes, decisions are made by resolution of a Remuneration Committee
comprising independent Outside Directors (majority) and the chairperson of the Board of
Directors who does not execute business, and headed by an independent Outside Director.
Remuneration Committee meetings are to be held at least four times per year. The committee
decides on the policy for determining remuneration details for the individual officers (Directors
and Executive Officers) of the Company, Daimaru Matsuzakaya Department Stores and PARCO,
and on the remuneration details for individual Directors and Executive Officers of the Company.
Basic remuneration positioned as fixed remuneration is decided for each mission grade based on
the size (weight) of the responsibility borne by each officer. As for bonuses, evaluation is carriedout using the “fiscal year’s financial indicators,” serving as quantitative evaluation, and the “fiscal
year’s non-financial indicators,” which include qualitative evaluation. The committee also
confirms the performance-linked factor in accordance with the level of achievement with respect
to figures announced in the initial forecast (IFRS based) following a resolution of the Board of
Directors to determine short-term performance shares that account for 40% of performance shares(performance-linked stock-based remuneration). Based on these results, the committee determinesthat the remuneration details for individual Directors and Executive Officers during the current
fiscal year align with the Company’s basic policy for officer remuneration and the approach todetermine remuneration levels.
Regarding Executive Officers’ bonuses and stock-based remuneration, the right of payment ofbonuses and granting of stock-based remuneration may be forfeited or the Company may request
the return of remuneration that has already been paid or granted in cases such as where the Boardof Directors has resolved that the financial results are to be amended afterwards due to a serious
accounting misstatement or fraud, or where there has been a serious infringement of theappointment contract, etc., between the Company and an officer, or when an officer has retired fortheir own reasons during their term of office against the will of the Company.
To properly promote the initiatives above, the Company appoints external remuneration
consultants with a view to introducing objective viewpoints from outside the Company andexpertise on Officer Remuneration Systems. With their support, the Company reviews its- 53 -

remuneration levels and remuneration system in light of external data, economic environment,
industry trends, business conditions, and corporate culture, among others.
The Officer Remuneration System is subject to review as scheduled in the Medium-term
Business Plan, and in April 2021 the Officer Remuneration Policy was revised in accordance with
the FY2021-FY2023 Medium-term Business Plan. During the Medium-term Business Plan period,
the level of basic remuneration will be reviewed if a drastic review becomes necessary due todramatic changes in the external environment and so forth.
For details of regarding the Officer Remuneration Policy, please refer to the “Notice Regarding
Revision of Officer Remuneration Policy” announced on April 13, 2021.
For details, please refer to:(https://www.j-front-retailing.com/_data/news/210413_remunerationpolicy_E.pdf)- 54 -

(5) Matters relating to Outside Directors
Important concurrent positions

YAGO Natsunosuke
Independent(Note)

Relationships between the Company
and organizations where importantconcurrent positions are held
Relationship with specified affiliatedbusiness operator
Attendance at the meetings of theBoard of Directors
Attendance at the meetings ofCommittees to which he belongs

Outside Director of SUBARU CORPORATION
Director of PARCO Co., Ltd.
PARCO Co., Ltd. is a wholly owned subsidiary of theCompany.
No items to report

100% (Attended all 15 meetings held during tenure thisfiscal year)
Nomination
100% (Attended all 16 meetings held
during tenure this fiscal year)
Remuneration 100% (Attended all 11 meetings held
during tenure this fiscal year)[Major activities during current fiscal year and overview of duties executed in roles that are expected to be fulfilled]
YAGO Natsunosuke has been involved in top-level company management for many years and has abundant experience instrengthening financial bases and in compliance management. He also has advanced knowledge of internal controls andcorporate governance based on his experience in transitioning to a company with three committees (nomination, audit andremuneration committees). As such, we accordingly expect him to provide advice and oversight enlisting points of view andperspectives that vary from those of the Inside Directors. Moreover, he has contributed to improving the effectiveness of theBoard of Directors by actively and assertively providing advice and oversight particularly in terms of taking drastic action
when it comes to efforts involving the importance of determination and leadership among the Group’s top executives, our
vision with respect to the Developer Business, and structural transformation linked to revamping our business foundations.
In regard to being a committee member, he serves as the Chairperson of the Nomination Committee and a member of theRemuneration Committee, and has been working to strengthen the functions of managers by fulfilling expectations and roles
associated with those committees. As Chairperson of the Nomination Committee, he has engaged in deliberating on Boardof Directors membership structures desirable with respect to the Company and its major subsidiaries with a focus on
succession plans, making transparent and fair decisions on officer appointments, and checking the status of future candidates
for positions in senior management. As a member of the Remuneration Committee, he has been contributing in part byreviewing our policy on the officer remuneration system and methods for calculating stock-based remuneration and bonuses,
along with review of specific rules of management.
Important concurrent positions
Member of the Ethics Committee of the JapaneseInstitute of Certified Public Accountants
Chairperson of the Committee on Training andResearch for Outside Officers, Japanese Institute ofCertified Public Accountants
Relationships
betweentheCompany
No special relationships exist
HAKODA Junya
and organizations where important
Independent
concurrent positions are held
(Note)
Relationship with specified affiliated No items to reportbusiness operator
Attendance at the meetings of the
100% (Attended all 12 meetings held during tenure thisBoard of Directors
fiscal year)
Attendance at the meetings of
Audit
100% (Attended all 14 meetings held
Committees to which he belongs
during tenure this fiscal year)[Major activities during current fiscal year and overview of duties executed in roles that are expected to be fulfilled]
HAKODA Junya has been involved in accounting audits, management consulting, and internal audits of auditing firms, etc.
as a certified public accountant for many years at PricewaterhouseCoopers, and also served as an eminent professor teachinginternal audit theory at the Graduate School of Keio University, and therefore has abundant experience and high-level
expertise in corporate auditing. As such, we accordingly expect him to provide advice and oversight enlisting points of view
and perspectives that vary from those of the Inside Directors. Moreover, he has contributed to improving the effectivenessof the Board of Directors by actively and assertively providing advice and oversight particularly in terms of the importanceof indicators such as ROIC (a Medium-term Business Plan target) and cash flows (calculated when reviewing businessfoundations and when verifying business segments), and in terms of formulating a roadmap for holistic monitoring of thedigital strategy. In regard to being a committee member, he serves as the Chairperson of the Audit Committee and has worked
to strengthen audit functions by fulfilling expectations of him promoting exchanges of opinions and discussions on items
submitted to the Board of Directors and items judged to require monitoring by the Audit Committee from the perspective oflegality, appropriateness, etc. while auditing the execution of duties by Directors and Executive Officers of a company withthree committees (nomination, audit, and remuneration committees). He also simultaneously works to improve governancepractices of the overall Group.

- 55 -

Important concurrent positions

UCHIDA Akira
Independent(Note)

Relationships between the Company
and each organization whereimportant concurrent positions are
held
Relationship with specified affiliatedbusiness operator
Attendance at the meetings of theBoard of Directors
Attendance at the meetings ofCommittees to which he belongs

Outside Director of Yokogawa Electric Corporation
Director of Daimaru Matsuzakaya Department Stores
Co. Ltd.
Daimaru Matsuzakaya Department Stores Co. Ltd. is awholly owned subsidiary of the Company.
No items to report

100% (Attended all 15 meetings held during tenure thisfiscal year)
Nomination
100% (Attended all 16 meetings held
during tenure this fiscal year)
Remuneration 100% (Attended all 11 meetings held
during tenure this fiscal year)[Major activities during current fiscal year and overview of duties executed in roles that are expected to be fulfilled]
UCHIDA Akira possesses extensive experience and knowledge of not only business planning and IR but also corporate
departments as the person responsible for the finance and accounting division. As such, we expect him to draw on such
experience and knowledge in providing advice and oversight enlisting points of view and perspectives that vary from thoseof the Inside Directors. Moreover, he has contributed to improving the effectiveness of the Board of Directors by actively
and assertively providing advice and oversight particularly in terms of appropriately conveying information to stakeholders
regarding matters such as earnings forecast revisions, strengthening intergroup alliances in serving as a holding company,
and conveying the necessity of new businesses in overhauling the business portfolio. In regard to being a committee member,he serves as the Chairperson of the Remuneration Committee and a member of the Nomination Committee, and has beenworking to strengthen the functions of managers by fulfilling expectations and roles associated with those committees. As
Chairperson of the Remuneration Committee, he has been promoting in part by reviewing our policy on the officer
remuneration system and methods for calculating stock-based remuneration and bonuses, along with review of specific rulesof management. As a member of the Nomination Committee, he has been contributing in part by deliberating on Board of
Directors membership structures desirable with respect to the Company and its major subsidiaries with a focus on succession
plans, making transparent and fair decisions on officer appointments, and checking the status of future candidates for
positions in senior management.
Important concurrent positions
Partner of Ishii Law OfficeOutside Director (Audit and Supervisory Committee
Member) of Dai-ichi Life Holdings, Inc.
Outside Director (Member of the Audit andSupervisory Committee) of NTT DATACORPORATION
Outside Audit & Supervisory Board Member of
Mitsubishi Corporation
SATO Rieko
Director of Daimaru Matsuzakaya Department Stores
Co. Ltd.
Independent
Relationships between the Company
Daimaru Matsuzakaya Department Stores Co. Ltd. is a
(Note)and organizations where important
wholly owned subsidiary of the Company.
concurrent positions are held
Relationship with specified affiliated No items to reportbusiness operator
Attendance at the meetings of the
100% (Attended 15 meetings held during tenure thisBoard of Directors
fiscal year)
Attendance at the meetings of
Audit
100% (Attended all 20 meetings held
Committees to which she belongs
during tenure this fiscal year)[Major activities during current fiscal year and overview of duties executed in roles that are expected to be fulfilled]
SATO Rieko has points of view and insights from a legal perspective on agenda topics based on abundant experience as wellas advanced and expert knowledge as a lawyer specializing mainly in corporate legal affairs. As such, we accordingly expect
her to provide advice and oversight enlisting points of view and perspectives that vary from those of the Inside Directors.
Moreover, she has contributed to improving the effectiveness of the Board of Directors by actively and assertively providing
advice and oversight particularly in terms of strengthening initiatives taken as a holding company under the Medium-term
Business Plan, conveying the necessity of efforts to more swiftly implement the digital strategy, formulating specificproposals based on the Group Management Policy for the fiscal year, and providing other insights from a legal perspective
on agenda topics. She also has served as a lead director of the Company’s executive session established as an opportunity
for Outside Directors to openly and freely exchange opinions and share information. In regard to being a committee member,she serves as a member of the Audit Committee and has worked to strengthen audit functions by fulfilling expectations of
her in terms of engaging in exchanges of opinions and discussions on items submitted to the Board of Directors and items
judged to require monitoring by the Audit Committee from the perspective of legality, appropriateness, etc. while auditing
the execution of duties by Directors and Executive Officers of a company with three committees (nomination, audit, andremuneration committees).

- 56 -

Important concurrent positions

Outside Director of VALQUA, LTD.
Outside Director of JSR Corporation
Outside Statutory Auditor of Asahi Mutual Life
Insurance Company
Director of PARCO Co., Ltd.
PARCO Co., Ltd. is a wholly owned subsidiary of theCompany.

Relationships between the Company
and organizations where importantconcurrent positions are held
Relationship with specified affiliated No items to reportbusiness operator
Attendance at the meetings of the
100% (Attended all 15 meetings held during tenure thisBoard of Directors
fiscal year)
Attendance at the meetings of
Audit
100% (Attended all 20 meetings held
Committees to which he belongs
during tenure this fiscal year)[Major activities during current fiscal year and overview of duties executed in roles that are expected to be fulfilled]
SEKI Tadayuki was involved in international business management and risk management at a general trading company formany years, and as CFO has both abundant knowledge and experience in relation to finance and accounting. He also has
wide-ranging insights derived from roles as Outside Director and Audit & Supervisory Board Member at multiple
companies. As such, we accordingly expect him to provide advice and oversight enlisting points of view and perspectives
that vary from those of the Inside Directors. Moreover, he has contributed to improving the effectiveness of the Board of
Directors by actively and assertively providing advice and oversight particularly in terms of conveying the importance ofcapital cost-conscious financial strategies and the necessity of ensuring appropriate valuations with respect to businessportfolios in carrying out mergers and acquisitions. In regard to being a committee member, he serves as a member of the
Audit Committee and has worked to strengthen audit functions by fulfilling expectations of him in terms of engaging in
exchanges of opinions and discussions on items submitted to the Board of Directors and items judged to require monitoringby the Audit Committee from the perspective of legality, appropriateness, etc. while auditing the execution of duties byDirectors and Executive Officers of a company with three committees (nomination, audit, and remuneration committees).
Important concurrent positions
Outside Director of Mitsubishi Electric Corporation
Outside Director of J-OIL MILLS, Inc.
Relationships between the Company
No special relationships exist
and organizations where importantconcurrent positions are held
KOIDE Hiroko
Relationship with specified affiliated No items to reportbusiness operator
Independent
Attendance at the meetings of the
100% (Attended all 12 meetings held during tenure this(Note)
Board of Directors
fiscal year)
Attendance at the meetings ofNomination
100% (Attended all 12 meetings held
Committees to which she belongs
during tenure this fiscal year)
Remuneration 100% (Attended all 7 meetings held
during tenure this fiscal year)[Major activities during current fiscal year and overview of duties executed in roles that are expected to be fulfilled]
KOIDE Hiroko served as an officer at foreign companies for many years, also engaged in corporate management as the headof marketing at the head office of a U.S. company, and therefore has knowledge based on extensive experience in global
management and in the marketing field. She also has wide-ranging insights derived from role as Outside Director at multiple
listed companies. As such, we accordingly expect her to provide advice and oversight enlisting points of view andperspectives that vary from those of the Inside Directors. Moreover, she has contributed to improving the effectiveness of
the Board of Directors by actively and assertively providing advice and oversight particularly in terms of giving rise toinitiatives such as those of the Medium-term Business Plan in serving as a holding company, conveying the importance of amarketing mindset particularly for articulating targets and needs, and engaging in cause analysis and implementing
countermeasures when encountering disparities between targets and results. In regard to being a committee member, she
serves as a member of the Nomination Committee and a member of the Remuneration Committee, and has been working tostrengthen the functions of managers by fulfilling expectations and roles associated with those committees. As a member of
the Nomination Committee, she has engaged in deliberating on Board of Directors membership structures desirable withrespect to the Company and its major subsidiaries with a focus on succession plans, making transparent and fair decisions
on officer appointments, and checking the status of future candidates for positions in senior management. As a member ofthe Remuneration Committee, she has been contributing in part by reviewing our policy on the officer remuneration system
and methods for calculating stock-based remuneration and bonuses, along with review of specific rules of management.
(Note) The above-mentioned Outside Directors are independent officers, which are required to be put in place by the Tokyo
Stock Exchange, Inc. and the Nagoya Stock Exchange, Inc. for the protection of general shareholders.

SEKI Tadayuki
Independent(Note)- 57 -

4. Matters relating to Accounting Auditor(1) Name of Accounting Auditor
Ernst & Young ShinNihon LLC(2) Amount of remuneration, etc. of Accounting Auditor(i) Amount of remuneration, etc. to be paid by the Company¥133 million(ii) Total cash and other financial profits to be paid by the Company and its¥318 million
subsidiaries(Note) The audit agreement entered into by the Accounting Auditor and the Company does not clearly distinguish theamount being derived from the audit under the Companies Act and that being derived from the audit under the
Financial Instruments and Exchange Act, and the two amounts cannot be practically distinguished from eachother. Therefore, the amount in (i) above indicates the total of these two kinds of amounts.

(3) Content of non-audit service
Support for adopting new accounting standard for revenue recognition, etc.
(4) Rationale for Audit Committee’s agreement on remuneration of the Accounting Auditor
The Audit Committee furnished its agreement with respect to the amount of remuneration, etc.
provided to the Accounting Auditor, which has been deemed appropriate upon conducting a review
regarding audit appropriateness with respect to the Accounting Auditor’s audit plan, its execution ofduties, the basis used for calculating remuneration estimates and other factors.
(5) Policy for determining dismissal or non-reappointment of Accounting Auditor
The Audit Committee is to take necessary measures that include dismissing the Accounting Auditor
upon gaining consent of all Audit Committee members, or otherwise making decisions on proposals to
dismiss or not reappoint the Accounting Auditor submitted to the Shareholders Meeting, in the eventthat the Audit Committee deems it appropriate to dismiss or otherwise not reappoint the Accounting
Auditor, either if there are grounds for dismissal as provided for in Paragraph 1, Article 340 of theCompanies Act of Japan, or if a situation arises whereby the audit of the Company has been significantly
impeded such as would be the case if the supervisory authorities were to issue an order requiring
suspension of auditing activities.
(6) Rationale for Audit Committee’s decision on reappointment of Accounting Auditor
The Audit Committee decided to reappoint Ernst & Young ShinNihon LLC, as a result ofcomprehensive considerations, following the evaluation of the appropriateness and validness of audit
activities by the Accounting Auditor based on the Accounting Auditor Evaluation Standards establishedby the Audit Committee.
5. Basic ideas on corporate governance(1) Role of corporate governance
The Company believes that ensuring sustainable growth of the Group and increasing corporate value
over the medium to long term is conducive to realizing ideals of the Group Mission Statement.
Accordingly, the role of corporate governance in the Group must be to help enable us to realize theideals of the Group Mission Statement.
The Company, which is a holding company at the core of corporate governance of the Group,
assumes responsibility for ensuring managerial transparency, soundness and compliance of the entire
Group, with the aim of realizing the ideals of the Group Mission Statement.
(2) Relationship with stakeholders
Through its business activities, the Company strives to build relationships of trust with all of its
stakeholders.

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Our shareholders are the providers of the Company’s capital and act as the main source of theGroup’s corporate governance. Accordingly, the Company respects shareholder rights to the maximum
extent (including those of minority shareholders and foreign shareholders), and substantively ensures
their rights.
The Company treats its shareholders equitably and impartially, in accordance with types and numbersof shares held by shareholders. Moreover, neither the Company nor the Group provides property
benefits to any person, such that relate to the exercise of the rights of specific shareholders.
The Company also actively works to fulfill its responsibilities towards customers, business partners,
employees and local communities in relation to the environment and society, as part of its efforts torealize a sustainable society.
(3) Information disclosure
We believe that promoting constructive dialogue with our shareholders and investors helps the Group
achieve sustainable growth while increasing corporate value over the medium to long term. The
Company is committed to timely and appropriate disclosure of information, on which constructive
dialogue is premised, and through such initiatives maintains and develops trusting relations with its
stakeholders.
The Company discloses important information of the Group in a timely and appropriate manner, in
accordance with Japan’s Financial Instruments and Exchange Act and other such laws and regulations,as well as in accordance with rules for timely disclosure stipulated by financial instruments exchanges
on which the Company’s shares are listed. Even in cases where such laws, regulations and the timely
disclosure rules do not apply, the Company recognizes information deemed useful to shareholders,investors and other stakeholders as important with respect to its corporate activities as called for bysociety. As such, the Company proactively discloses such information in an impartial and swift mannerusing appropriate means, and with the added aim of facilitating more extensive understanding regarding
the Group.
(4) Roles and responsibilities of the Board of Directors, etc.
Directors, who were appointed by the shareholders and were entrusted with management of theCompany, carries out the roles and responsibilities in the Board of Directors as listed below. They doso in accordance with their fiduciary responsibility and accountability to shareholders, and with the aimof realizing the ideals of the Group Vision. Accordingly, these roles and responsibilities include:(i)

Indicating the overall direction that Group management is to take, by engaging in constructive
discussions with respect to the Group Vision, the Sustainability Policy, the Group Medium-term
Business Plan, the Group Management Policy for the fiscal year, and other fundamental
management policies, and carrying out multifaceted and objective deliberations that include
evaluation of risks with respect to the aforementioned;(ii) Appropriately making decisions in terms of overall policy and plans pertaining to the Groupmanagement on the basis of the direction noted above and overseeing progress and results of theplans;(iii) Developing an environment conducive to encouraging offense-oriented management geared toachieving discontinuous growth;(iv) Taking steps to build and develop internal control systems of the Group overall, and otherwise
overseeing the operational status of such systems;(v) Overseeing conflicts of interest between related parties; and(vi) On the basis of summary reports furnished by the Nomination Committee, overseeing progress of
President and Representative Executive Officer succession planning, personnel assignment plans
pertaining to managerial talent and Executive Officer training, in consultation with the Nomination
Committee.
(5) Systems of corporate governance
The Company is currently adopting a company with three committees (nomination, audit andremuneration committees) as organizational structure. The reasons are as follows.
(i)

The Company will strengthen the oversight function for business execution of the Board of
Directors by separating oversight from execution. In addition, the Company aims to promote- 59 -

sophistication of strategy by having the Board of Directors actively include the insights of external
persons in order to hold rigorous discourse on important strategic issues relating to the Groupmanagement.
(ii) The Company will enable decisions of business execution to be delegated to Executive Officers,
clarify the authority and responsibility, and carry out speedy management decision making.
(iii) The Company will improve the transparency and objectivity of management by adopting acompany with three committees (nomination, audit and remuneration committees) organizational
structure. The majority of the members of each of these committees are independent Outside
Directors.
(iv) The Company will build a governance structure that is easy to understand from global perspectives,
such as those of overseas investors.
6.

Operation of the Board of Directors
Composition of the Board

8 Directors who do not execute business (including 6 Outside Directors) and 4
Directors who concurrently serve as Executive Officer

Major roles

The Board of Directors shall discuss and resolve matters defined in the Companies
Act and/or the Articles of Incorporation, as well as matters relating to management
strategies, such as the Sustainability Policy, the Group Medium-Term Business
Plan, the Group Management Policy for the fiscal year, and matters relating toimportant business execution such as asset acquisition.

Operational status

Held at least once every month, in principle. With one-half of Directors being
independent Outside Directors, the Board of Directors functions as a venue forconstructive discussions and deliberations, beyond being solely a decision-making
body for important matters, and is a key to the enhancement of corporate
governance.

Comment from Chairperson of
the Board

In FY2021, the Board of Directors met 15 times to deliberate matters such as thefollowing agenda items, which were selected in view of developments regarding
the COVID-19 pandemic and given that FY2021 served as the initial fiscal year of
the FY2021-FY2023 Medium-term Business Plan.
“Actions to take in view of developments regarding the COVID-19
pandemic (profitability under different scenarios of impact on earnings
performance, financing measures, etc.),” “transformation of the department
store business model,” “strategies for growth of the Payment and FinanceBusiness,” “the Group digital and human resource strategy,” “the GroupManagement Policy for FY2022,” etc.
In FY2022, the Board of Directors will address the key themes of “transforming theGroup’s business portfolio” and “promoting sustainability management in view ofenvironmental and social challenges,” with our sights set on achieving regrowth in
FY2024 and beyond amid projections of a severe business environment due topersisting effects of the COVID-19 pandemic.
The Company plans to adopt a Board of Directors structure whereby a majority ofits membership comprises independent Outside Directors beginning in FY2022
with the aim of achieving outcomes that contribute to heightening its oversightfunction, enabling highly effective deliberations with respect to the aforementioned
issues, and increasing our corporate value.

Director
YAMAMOTO Ryoichi(Evaluation of effectiveness of the Board of Directors)
The Company conducted its seventh evaluation of the effectiveness of the Board of Directors between
September and October 2021. This involved having a third-party organization conduct individualinterviews based on questionnaires administered beforehand, after which the Board of Directors
engaged in discussions in October on the basis of a report containing analysis of aggregatedquestionnaire findings.
As a result, we pinpointed the following four issues: “articulating roles of the holding company andits Board of Directors,” “having the Board of Directors focus on proposals and discussions of strategic
importance,” “reviewing the composition of the Board of Directors,” and “further strengthening thefunction of the Board of Directors secretariat.”
We accordingly sought to address these issues by articulating the holding company’s roles in the
FY2022 Group Management Policy and strengthening the function of planning to facilitate strategy- 60 -

implementation. Now that we have also reviewed the composition of the Board of Directors, we plan
to adopt a Board of Directors structure beginning in FY2022 whereby a majority of its membershipcomprises independent Outside Directors to ensure even greater effectiveness with respect to its
discussions.
We will continue to strive to share issues based on the evaluation of the effectiveness of the Board of
Directors and improve the effectiveness of the Board of Directors.
7. Operations of each Committee(1) Nomination Committee
Composition of Committee

4 Directors who do not execute business (including 3 Outside Directors)

Major roles

The Nomination Committee determines the contents of proposals on thenomination and dismissal of Directors to be submitted to shareholders’ meetings,
and reports to the Board of Directors upon consultations from the Board of
Directors regarding the nomination and dismissal of management personnel of theCompany and major business subsidiaries, as well as the chairpersons and membersof individual committees, and other matters.

Number of meetings held

16

Number of meetings attended

3 incumbent members attended all 16 meetings. Director Koide, who was newly
appointed in May 2021, also attended all 12 meetings held during her tenure.

Comment from Chairperson of
the Committee

The Nomination Committee utilizes in-house personnel evaluation information as
well as assessment data by a third-party organization to deliberate effective
composition of the Board of Directors and the election and dismissal of Directors
including Outside Directors as well as Executive Officers of the Company. The
committee also obtains opportunities to get to know candidate’s personalities andideas through conducting interviews, etc., as necessary, and ensures higher
objectivity, transparency and rationality.
The Nomination Committee has positioned the management team succession plan
as a central issue necessary to generate sustainable growth of the Company andcontinues to conduct related deliberations. As for training of candidates for the next
generation of managers, the committee evaluates their performance, diagnoses
managerial talent, debates roles and transfers to train and strengthen potential
successors, and ties this to implementation if necessary.
The Nomination Committee will secure management personnel necessary forcontinuous growth and development of the Company, and strive for the election of
the right person in the right place.

Director (Outside)
YAGO Natsunosuke- 61 -

(2) Audit Committee
Composition of Committee

4 Directors who do not execute business (including 3 Outside Directors)

Major roles

In accordance with the overall policy and plan determined by the Board of
Directors, the Audit Committee audits the execution of business by Directors andExecutive Officers, important matters to be submitted to the Board of Directors,
and other individual matters the Audit Committee considers necessary.

Number of meetings held

20

Number of meetings attended

2 incumbent members attended all 20 meetings. Chairperson of the Audit
Committee Hakoda, who was newly appointed in May 2021, also attended all 14
meetings held during his tenure, as did Director Hamada.

Comment from Chairperson of
the Committee

The Audit Committee, in accordance with the Rules of Audit Committee, Audit
Standards, and Practice Standards for Audit concerning Internal Control System,
etc., formulated an audit plan for the current fiscal year, conducted the audit, andreported its contents to the Board of Directors.
The committee also conducted hearing at Audit Committee Meeting (held 15
times), a meeting body held apart from the Audit Committee, regarding topics suchas the group’s business strategy, progress of organizational reform, and governanceand risk management system under the influence COVID-19 pandemic to gain
understanding of the current situation.
The Audit Committee will work to further strengthen and enhance theorganizational audit system through mutual cooperation with the Internal Audit
Division, Accounting Auditors, and Audit & Supervisory Board Members of theGroup companies, from the perspective of increasing the effectiveness and accuracyof audits. It will also continue to work to establish a high quality corporate
governance structure that is worthy of social trust and to conduct audits in a fair andimpartial manner to contribute to the growth of the Group and the enhancement of
its corporate value.

Director (Outside)
HAKODA Junya- 62 -

(3) Remuneration Committee
Composition of Committee

4 Directors who do not execute business (including 3 Outside Directors)

Major roles

The Remuneration Committee determines the policy on deciding the contents ofindividual remuneration to management personnel of the Company and major
business subsidiaries, and these contents themselves.

Number of meetings held

11

Number of meetings attended

3 incumbent members attended all 11 meetings. Director Koide, who was newly
appointed in May 2021, also attended all 7 meetings held during her tenure.

Comment from Chairperson of
the Committee

Pursuant to the Officer Remuneration Policy formulated in April 2017 and revisedin 2021, the Remuneration Committee examines the overall level of officer
remuneration and the ratio of performance-linked remuneration, as well as the ratioof stock-based remuneration therein against preset peer group. By doing so, theCompany maintains objective and appropriate remuneration level and system at all
times.
Regarding the Officer Remuneration System and Officer Remuneration Policy
revised in accordance with the Medium-term Business Plan that commenced infiscal 2021, we examined trends through a third-party organization concerning theoverall level of officer remuneration, the ratio of performance-linked remuneration,and stock-based remuneration for officers. At the same time, for bonuses that reflect
the status of individual officer’s achievements, we review each officer’s goal setting
and evaluation results as well as evaluation items, evaluation weights andevaluation rank determination process, to ensure that the end result will be shownwith greater fairness and objectivity.
The Company has designed an appropriate remuneration system and remunerationlevel to compensate officers the amount adequate for their work and commensuratewith their offices and the role entrusted to them as professional managers. Goingforward, we will continue to operate the system appropriately.

Director (Outside)
UCHIDA Akira

8. System and policies of the Company(1) Systems to ensure properness of operations <Basic Policy to Build Internal Control System>
The Basic Policy to Build Internal Control System is disclosed on our website (https://www.j-frontretailing.com/) in accordance with the laws and regulations and the Article 16 of the Company’s Articles
of Incorporation.
You can access here to read the entire contents of the Basic Policy to Build Internal Control System.
(https://www.j-front-retailing.com/english/company/internalcontrol.html).
(2) Operational status of systems to ensure properness of operations <Basic Policy to Build Internal
Control Systems> (FY2021)
The Company endeavors to maintain its internal control systems and properly operate such systems
on the basis of its “Basic Policy to Build Internal Control Systems.” Details regarding the overall statusof such operations during the current fiscal year are as follows.
I.

The Group Management System(i) Board of Directors
1) To separate supervisory and executive functions and ensure the effectiveness of discussions at
the Board of Directors, the Board of Directors is comprised half of independent Outside
Directors who have no risk of a conflict of interest with the Company’s shareholders, and amajority of Directors who do not execute business (Internal Directors who do not executebusiness and independent Outside Directors), as well as the Representative Executive Officer,
general managers of the Company, which is a holding company, and the persons responsible atmajor business subsidiaries. It functions to oversee the execution of duties by Executive
Officers and Directors.
2) The Board of Directors deliberates on material issues related to the Group management. As forthe findings of and issues raised by the Board of Directors, there are demands for additional
reports on execution, and efforts are made to run through the PDCA cycle, including additional- 63 -

debate by the Board of Directors. Briefings are also provided to Outside Directors prior to theBoard of Directors meetings for fuller discussions at such meetings. The effectiveness of theBoard of Directors is being improved through these initiatives.
3) The meetings of the Board of Directors were held 15 times in the current fiscal year. Theirdiscussions included monitoring of the Medium-term Business Plan (in its first year this fiscal
year) and efforts toward structural reform in light of the COVID-19 pandemic and its financial
impact, as well as matters defined in the Companies Act and/or the Articles of Incorporation.
In addition, the Board of Directors evaluates the state of developing and operating the various
items stipulated in the “Basic Policy to Build Internal Control System” and confirms there areno major problems.
4) Evaluations of the effectiveness of the Board of Directors are performed by a third-party
organization each fiscal year to continuously and further improve the effectiveness of the Boardof Directors by resolving any identified issues.
(ii) Management execution framework
1) In the Company, the organization responsible for execution consists of the Management
Strategy Unit, Group Digital Strategy Unit, Financial Strategy Unit, Human Resources Strategy
Unit, and Administration Unit. Following on the mission of the President and Representative
Executive Officer, the Executive Officer, who is the Senior Executive General Manager,
prepares missions for each strategy unit in order to realize the Medium-term Business Plan and
the Annual Execution Plan. These units execute business and supports the operations andmanagement of operating companies in line with its duties and mission.
2) The roles and responsibilities of the Company as a holding company include planning andformulating the Group Vision, the Group Medium-term Business Plan and the GroupManagement Policy; managing the progress and performance of these activities; establishingbusiness portfolio management (optimal allocation of the Group’s management resources),human resources management, shareholder management and corporate governance group-wide.
With regard to matters related to business execution at operating companies, in order to promote
speedy management decisions and clarify management responsibilities; standards have been
established for delegating authority to operating companies, which exclude items that have an
important impact on the Group management; and things are operated in accordance with thesestandards.
3) The Company has established various meetings to execute items, the roles of which are clearly
indicated. The Group Management Meeting focuses on discussions of important issues to besubmitted to the Board of Directors, such as overall policy and plans for the Group’s
management. The matters discussed are reviewed at the Group Policy Meeting, each segment’s
Medium-term Business Plan Progress Meeting, and the Operating Associates Results andStrategy Examination Meeting to help facilitate prompt management decisions.
4) As a rule, the common Group accounting system is introduced; and efforts are made to promote
more efficient operations and integrated and more efficient fund procurement by the Groupthrough a cash management system.
5) With regard to internal controls over financial reporting, the Company and operating companies
maintain and operate internal systems to ensure the reliability of financial reporting in line with
the Financial Instruments and Exchange Act and various associated laws and regulations.
II. Risk Management System(i) Risk Management Committee
1) The Company has established the Risk Management Committee as an advisory body to the
President and Representative Executive Officer with regard to risk management. The committee
is chaired by the President and Representative Executive Officer and comprises Executive
Officers and others.

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The committee regularly discusses, identifies, and evaluates risks (uncertainties), prioritizes
them and reflects them in strategies, monitors related countermeasures, and submits related
reports to the Audit Committee and the Board of Directors.
2) In the fiscal year under review, the committee met four times. In preparation for the formulationof the FY2022 management policy, it discussed forecasts for the business environment in lightof the impact of the COVID-19 pandemic and various social changes that are likely to occur in
its wake, including those related to consumption. In addition, it reviewed the roles within theholding company to improve risk management for the whole Group, and confirmed thestrengthening of the holding company’s support system to help operating companies identify
risks they may face.
(ii) Execution control
Under the direction of the President and Representative Executive Officer, the Company has
placed designated staff in the Management Planning Division in the Management Strategy Unitand develops and manages internal controls under the Companies Act and the internal control
system under the Financial Instruments and Exchange Act at the Company and operatingcompanies.
During the current fiscal year, no material deficiencies that should be disclosed were found, andthis was reported to the Audit Committee and the Board of Directors.
(iii) Hazard risk response
For hazard risks such as large-scale earthquakes, fires, and accidents, the Company has
established a system in which crisis management is controlled by the “Emergency Response
Headquarters” headed by the President and Representative Executive Officer.
During the current fiscal year, the Company developed a system based on its “Crisis
Management Rules” and “Business Continuity Manual” to be followed in case of a large-scale
natural disaster. We have also made efforts to improve our ability to respond to a wide range ofcrisis events by conducting BCP drills several times, including at our operating companies.
Regarding our response to infectious diseases, with the safety and security of our customers
and employees as our top priority, we have implemented hygiene management practices to help
prevent outbreaks and other measures to help prevent the spread of disease. We will also create a“New Infectious Disease Response Manual” in line with the Crisis Management Rules.
III. Legal Compliance System(i) Compliance Committee
1) The Company has established the Compliance Committee as an advisory body to the President
and Representative Executive Officer regarding the compliance operation. The President andRepresentative Executive Officer shall be the chairperson and the members of the committee
shall be a corporate lawyer, Executive Officers and others.
2) Departments and responsible persons in charge of promotion of compliance and risk
management are also put at operating companies, and carry out daily supervision and directionof business operations that are in accordance with laws and regulations and internal company
rules.
3) The Compliance Committee met four times during the current fiscal year and discussed factors
behind and countermeasures against compliance-related violations and provided instructions to
implement specific measures to prevent recurrence. In addition, the Committee once again
carried out a group-wide discussion on what the Group’s compliance should be, andreconfirmed that it is a broader concept that is not just a matter of compliance but is somethingrooted in corporate philosophy.
4) In order to spread efforts to ensure compliance, those responsible for compliance at each Group
company meet four times a year to increase compliance awareness and implement activities
within the entire Group. We also conducted trainings on the theme of prevention of fraud andmisconduct for officers and those in charge of compliance of each Group company.
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(ii) Whistle-blowing system
1) The Company has established the “JFR Group Compliance Hotline” for reporting issues to theCompany or an independent party (corporate lawyer), which may be used by all persons
working at the Company and operating companies.
2) For hotline reports concerning management personnel, the Company has built a structure
whereby the reports are directly submitted through the hotline desk to the Audit Committee andsubjected to directions from the Audit Committee.
3) During the current fiscal year, efforts were made to increase recognition and promote
understanding of the system among the Group company employees through measures such as
posting analysis of issues reported and the status of responses to them on our in-house portal
site. As a result, 46 cases related to labor-management relations and other issues were reported,and are being dealt mainly by the secretariat.
IV. Internal Audit Structure1) The Company has established an independent Internal Audit Division under the President andRepresentative Executive Officer. The Internal Audit Division verifies and evaluates the legality
and effectiveness of systems of corporate governance, risk management and compliancemanagement, in addition to performing audits on business operations of the Company andoperating companies.
2) There is a system in which reports are submitted to both the President and Representative
Executive Officer and the Audit Committee, and audit results and improvement measuresrelated to audit findings are regularly reported. As for orders related to improvement measuresfrom management, issues are promptly handled in collaboration with the audited departments.
3) We have established an audit structure that utilizes digital equipment to enable execution ofaudit under COVID-19, and are performing audits. During the current fiscal year, we conducted
operational audits on the status of legal compliance with the Labor Measures Comprehensive
Promotion Act, the Antimonopoly Act, and other statutes, as well as the status of developmentof operational rules and regulations and their compliance. We also conducted audits based onthemes such as the status of crisis management systems and the status of executing theCompany’s real estate business.
V. Structure of the Audit Committee
1) The Audit Committee, which is chaired by an Outside Director, is composed of four members
including Directors who do not execute business and are Inside Directors.
2) In accordance with the overall policy and plan determined by the Board of Directors, the Audit
Committee audits the execution of business by Executive Officers and Directors, importantmatters submitted to the Board of Directors, and other individual matters the Audit Committee
considers necessary, as well as the status of establishing and implementing internal controls,
and then prepares audit reports.
3) The Audit Committee receives explanations on the audit policy and plan prior to the audit fromthe Accounting Auditor, and receives explanations and reports on the audit results and expresses
its opinions including requests on audit items, and in addition, exchanges of opinions with the
Accounting Auditor are carried out on a regular basis. In addition, it receives regular audit
reports from the Internal Audit Division on the status of improvements regarding issues
identified through internal audits.
4) To grasp important decision-making processes and the status of the execution of duties, fulltime members of the Audit Committee not only attend important committees and other meetings,
such as the Group Management Meeting, but also peruse important documents relating to the
execution of business such as approval circulars.
5) During the current fiscal year, the Audit Committee met 20 times. Apart from the Audit
Committee, efforts are being made at the Audit Committee Meeting, to gain understanding of
the current situation regarding execution by carrying out audits on execution of duties of all of
the Executive Officers of the Company. Moreover, the Audit Committee works closely with the- 66 -

Audit & Supervisory Board Members of the Group companies through regular meetings toshare recognition of auditing issues and exchange opinions.
VI. Other(i) System for storage and management of information
Documents relating to the execution of duties by Executive Officers and Directors and theminutes of the important meetings and committees such as the meetings of the Board of Directors
and the Group Management Meeting are being accurately recorded and prepared, and information
is being properly stored and managed by the responsible department.
(ii) Digital information security
In order to strengthen security, the Company has formulated a “JFR Group Information Security
Policy,” shares that policy within the Group, and manages digital information based on that.
Reports on the status of digital information management and related matters are made at the Boardof Directors, the Audit Committee, and the Group Management Meeting regularly and whennecessary.
The Company’s “IT governance policy, regulations, and rules” are intended to minimize
potential IT related risks and to increase corporate value; based on these, through measures like
Regular IT Governance Meeting and System Development Meeting, the Company controls
activities ranging from the development of IT strategy to its implementation. We also promote
efforts to ensure compliance with our information security policy through e-learning for all
employees and ongoing training related to targeted e-mail attacks.
(3) Basic policy regarding control of the Company
I. Contents of basic policy
The Company believes it is necessary for the party controlling the Company’s financial andbusiness policy decisions to be a party who sufficiently understands the financial and business detailsof the Group and the sources of the Group’s corporate value, continuously and sustainably ensuresthat the corporate value of the Group and, by extension, the common interests of shareholders areserved, and enables further improvement in this area.
As the Company is a listed enterprise, the Company’s policy regarding its shareholders is that, ingeneral, they are determined through free market transactions on the financial instruments market.
Furthermore, even in the case of a purchase of shares of the Company above a certain scale byspecific shareholders or specific groups (hereinafter “Large-Scale Purchase”), if this Large-Scale
Purchase will contribute to the corporate value of the Group and, by extension, the common interestsof its shareholders, the Company believes that this should not be rejected outright and that, ultimately,
the decision on whether to accept or reject it should be left to the discretion of the Company’s
shareholders.
Nevertheless, a Large-Scale Purchase that involves a serious risk of causing damage to thecorporate value of the Group may be envisaged. This may include a Large-Scale Purchase that, inview of its purpose and other factors, would demonstrably harm the Group’s corporate value; one
with the potential to involve substantial coercion of shareholders to sell shares of the Company; or
one that would not provide sufficient time and information for the Company’s Board of Directors
and shareholders to consider factors such as the details of the large-scale purchaser’s proposal, or for
the Company’s Board of Directors to make an alternative proposal.
A party attempting this kind of Large-Scale Purchase, which would not contribute to the corporate
value of the Group and, by extension, the common interests of its shareholders (hereinafter, the“Large-Scale Purchaser”), would not be appropriate as a party controlling the Company’s financial
and business policy decisions. Accordingly, the Company believes that it is the duty of theCompany’s Board of Directors, which is entrusted by the shareholders to manage the Company, torespond to this kind of Large-Scale Purchase by ensuring that processes such as provision of
information by the Large-Scale Purchaser and considerations and evaluations by the Company’s
Board of Directors are carried out, and securing sufficient time for the Company’s Board of Directors
and shareholders to consider the details of the Large-Scale Purchaser’s proposal in order to prevent- 67 -

damage to the corporate value of the Group and, by extension, the common interests of its
shareholders.
II. Frameworks contributing to realization of basic policy
Since the foundation of Daimaru and Matsuzakaya, the Group has been engaged in businesses ofkimono fabric stores and department stores for many years based on the corporate philosophies andtraditional spirits of these businesses, which are: “Service before profit (those who place service
before profit will prosper),” “Abjure all evil and practice all good” and “In doing good to others, we
do good to ourselves.”
The Company believes that the sources of the Group’s corporate value are the relationships oftrust it has established with customers and with society, which have been refined on the basis of thesephilosophies and spirits.
Accordingly, in order to exemplify the principles of “customer-first principle” and “contribution
to society,” which are in common with these philosophies and spirits, the Company has establishedthe following Basic Mission Statement of the Group: “to aim at providing high quality products andservices that meet the changing times and satisfying customers beyond their expectations” and “toaim at developing the Group by making a broad contribution to society as a fair and trusted business
entity.” Based on this Basic Mission Statement, the Company implements a wide range of measures,
aiming to realize the Group Vision of “Create and Bring to Life ‘New Happiness,’” in order to makea contribution to securing and enhancing the corporate value of the Group and, by extension, thecommon interests of shareholders.
III. Framework to prevent parties deemed inappropriate in light of basic policy from controlling thefinancial and business policy decisions of the Company
At present, the Company has not specifically stipulated a concrete framework for a case in whicha Large-Scale Purchaser appears, commonly known as takeover defense measures.
Nevertheless, the Company believes that, in order to prevent damage to the Group’s corporate
value if a Large-Scale Purchaser appears, it is necessary to carefully examine the impact a LargeScale Purchase would have on the Group’s corporate value after ascertaining certain information
about the Large-Scale Purchaser. Such information would include the nature of the Large-Scale
Purchaser, the purpose of the Large-Scale Purchase, the Large-Scale Purchaser’s proposed financial
and business policies and their policy for handling shareholders, the Group’s customers, business
partners, employees, the communities that surround the Group, and other stakeholders.
Accordingly, if this occurs, the Company will establish an independent committee composed of
Outside Officers and experts with viewpoints that are independent from the Company’s management
personnel and Inside Directors. If the Company judges that the said Large-Scale Purchaser isinappropriate in light of the aforementioned basic policy after considering advice and opinions fromthe committee, the Company will act to secure the Group’s corporate value and, by extension, thecommon interests of shareholders by taking necessary and appropriate countermeasures.
IV. Judgment of the Company’s Board of Directors regarding concrete framework and reasons for such
judgment
Various measures formulated by the Group are formulated based on the Group’s Basic Mission
Statement, and are intended to further build up the relationships of trust with customers and withsociety, which are the sources of the Group’s corporate value. Therefore, the Company believes thatthese measures are in line with the contents of the basic policy and contribute to securing andenhancing the corporate value of the Group and, by extension, the common interests of shareholders.
Furthermore, if the Company takes necessary and appropriate countermeasures against a LargeScale Purchaser judged to be inappropriate in light of the basic policy, the fairness, neutrality andrationality of this judgment will be ensured by making it in consideration of advice and opinionsfrom an independent committee whose independence from the management personnel and Internal
Directors of the Company is assured. Accordingly, the Company believes that these measures would
not damage the corporate value of the Group or the common interests of shareholders, and that they
are not intended to maintain the positions of the officers of the Company.

- 68 -

(4) Basic Capital Policy
The Company believes that any increase in free cash flow and improvement in ROE should help toensure its sustainable growth and increase corporate value over the medium to long term. To such ends,
the Company promotes a capital policy that takes a balanced approach to “undertaking strategic
investment,” “enhancing shareholder returns,” and “expanding net worth being” after taking into
consideration the business environment and risk readiness.
Moreover, in procuring funds through interest-bearing liabilities, we aim to achieve an optimal
structure of debt to equity in a manner cognizant of our funding efficiency and cost of capital, carriedout on the basis of having taken into consideration our capacity for generating free cash flows and ourbalance of interest-bearing liabilities.
A “business strategy” where higher sales are accompanied by profits and a “financial strategy(encompassing the capital policy)” that heightens profitability of invested capital are essential elementswith respect to improving free cash flows and ROE. In addition, we believe it is crucial that we achieve
maximization of the operating profit and sustainable improvement of the operating profit margin bystrengthening our core businesses and concentrating management resources on initiatives such as
business field expansion and active development of new businesses.
The key financial indicators for the achievement of the Medium-term Business Plan are ROE for
capital efficiency, consolidated operating profit and ROIC for business profitability, free cash flow for
profitability and safety, and equity ratio attributable to owners of the parent (equity ratio) for financial
soundness.
(5) Policy regarding decisions on dividends of surplus, etc.
The Company’s basic policy is to appropriately return profits. Hence, while maintaining andenhancing its sound financial standing, the Company strives to provide stable dividends and target a
consolidated dividend payout ratio of no less than 30%, taking profit levels, future capital investment,
free cash flow trends and other such factors into consideration. The Company also gives consideration
to the option of purchasing its own shares as appropriate, in accordance with aims that include
improving capital efficiency and implementing a flexible capital policy.
(6) IR Policy
We aim at developing the Group by contributing to society at large as a fair and reliable corporation.
Under such Basic Mission Statement, the Company promotes IR activities for the purpose ofmaintaining and developing relations of trust with stakeholders including shareholders and investors.
By accurately and plainly disclosing important financial and non-financial information about theCompany in a fair, timely and appropriate manner, we aim to improve management transparency andhelp stakeholders better understand the Company.
Amounts in millions of yen presented in the business report above have been rounded down to the nearest one million
yen.

- 69 -

Consolidated Financial Statements
Consolidated Statement of Financial Position (As of February 28, 2022)
Item
AssetsAmountCurrent assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Inventories
Other current assets

234,884
93,278112,262
11,92912,4594,954

Non-current assets
Property, plant and equipment
Right-of-use assets
Goodwill
Investment property
Intangible assets
Investments accounted for using
equity method
Other financial assets
Deferred tax assets
Other non-current assets

958,022480,380
140,470523
189,688
7,289
38,761

Item
Liabilities
Current liabilities
Bonds and borrowings
Trade and other payables
Lease liabilities
Other financial liabilities
Income tax payables
Provisions
Other current liabilities(Millions of yen)Amount347,413108,152
116,107
28,55429,915
4,485
954
59,243

Non-current liabilities
Bonds and borrowings
Lease liabilities
Other financial liabilities
Retirement benefit liability
Provisions
Deferred tax liabilities
Other non-current liabilities

483,373
209,562
155,839
36,741
19,416
9,553
51,697563

Total liabilities
EquityEquity attributable to owners of parent
Share capital
Capital surplus
Treasury shares
Other components of equity
Retained earnings

830,787
350,368
31,974
188,894(14,780)
9,574
134,705

Non-controlling interests

11,751

79,977
8,209
12,721

Total equity
Total liabilities and equity
Total assets
1,192,907(Note) Amounts have been rounded down to the nearest one million yen.

- 70 -

362,120
1,192,907

Consolidated Statement of Profit or Loss (From March 1, 2021 to February 28, 2022)(Millions of yen)
Item

Amount331,484(183,642)

Revenue
Cost of sales
Gross profit
Selling, general and administrative expenses
Other operating income
Other operating expenses

147,842(136,123)
11,068(13,406)

Operating profit
Finance income
Finance costs
Share of profit (loss) of investments accounted for using equity
method9,380
1,335(5,890)

Profit before tax
Income tax expense

6,190(2,225)

Profit3,964

Profit attributable to:
Owners of parent
Non-controlling interests

4,321
(356)

(Note)

ProfitAmounts have been rounded down to the nearest one million yen.

- 71 -

1,364

3,964

Consolidated Statement of Changes in Equity (From March 1, 2021 to February 28, 2022)(Millions of yen)
Equity attributable to owners of parent
Other components of equity

Balance as of March 1, 2021

Share capital

CapitalsurplusTreasurysharesExchangedifferenceson translationof foreign
operations

Cash flow
hedgesFinancial assets
measured at fair
Remeasurements ofvalue throughdefined benefit
other
plans
comprehensive
incomeTotal

31,974

188,542(14,830)

(89)

11

9,656

–

9,578

Profit

–

–

–

–

–

–

–

–

Other comprehensive
income

–

–

–

150

(13)

(53)

1,769

1,852

Total comprehensive income

–

–

–

150

(13)

(53)

1,769

1,852

Purchase of treasury shares

–

–

(32)

–

–

–

–

–

Disposal of treasury shares

–

(0)

0

–

–

–

–

–

Dividends

–

–

–

–

–

–

–

–

Share-based paymenttransactions

–

351

81

–

–

–

–

–

Transfer from othercomponents of equity toretained earnings

–

–

–

–

–

(86)

(1,769)(1,855)

–

351

49

–

–

(86)

(1,769)(1,855)31,974

188,894(14,780)

60

(1)

9,516

–

9,574

Total transactions withownersBalance as of February 28,
2022

Equity attributable to ownersof parent

Total

Total

Noncontrollinginterests

136,906

352,171

12,171

364,343

4,321

4,321

(356)

3,964

–

1,852

1

1,853

Total comprehensive income

4,321

6,173

(355)

5,818

Purchase of treasury shares

–

(32)

–

(32)

Disposal of treasury shares

–

0

–

0

(8,377)(8,377)(64)(8,442)

–

433

–

433

1,855

–

–

–

Total transactions withowners(6,522)(7,976)(64)(8,041)

Balance as of February 28,
2022

134,705

350,368

11,751

362,120

Balance as of March 1, 2021
ProfitOther comprehensive
incomeDividends
Share-based paymenttransactions
Transfer from othercomponents of equity toretained earnings(Note)

Retainedearnings

Amounts have been rounded down to the nearest one million yen.

- 72 -

[Reference]
Consolidated Statement of Cash Flows (Summary) (From March 1, 2021 to February 28, 2022)(Millions of yen)
Item

AmountCash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at end of period(Note)
Amounts have been rounded down to the nearest one million yen.

- 73 -

49,866(5,289)(80,392)(35,815)
128,925
168
93,278

Non-consolidated Financial Statements
Non-consolidated Balance Sheet (As of February 28, 2022)
J. Front Retailing Co., Ltd.
Item
AssetsCurrent assets
Cash and deposits
Short-term loans receivable fromsubsidiaries and associates
Other
Allowance for doubtful accounts

Non-current assets
Property, plant and equipment
Buildings and structures
Other

Intangible assets
SoftwareInvestments and other assets
Investment securities
Shares of subsidiaries and associates
Long-term loans receivable fromsubsidiaries and associates
Deferred tax assets
Other
Allowance for doubtful accounts
Deferred assets
Bond issuance costs(Note)

AmountItem
Liabilities
135,887 Current liabilities
85,030
Short-term borrowings
Bonds payable
49,074
Commercial papers
2,152
Deposits received(370)
Accrued expenses
Accounts payable - other
Income taxes payable
Provision for bonuses
Provision for bonuses for directors
and other officers
Asset retirement obligations
Provision for officer remuneration
BIP trust
Other
505,172
94
77
16

553
553

504,524
1,660
377,268
124,000
1,615
479
(500)
247
247

(Millions of yen)Amount93,86455,15020,00015,002
1,795
616
521
356
139
95
29
111
47

Non-current liabilities
Bonds payable
Long-term borrowings
Long-term deposits received for
officer shares trust
Provision for officer remuneration
BIP trust

212,201
80,000129,810

Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Legal capital surplus
Other capital surplus
Retained earnings
Other retained earnings
Retained earnings brought
forwardTreasury shares

306,066

Valuation and translation adjustments
Valuation difference on available-forsale securities

Total net assets
Total assets
641,307
Total liabilities and net assets
Amounts have been rounded down to the nearest one million yen.

- 74 -

1,978
413

335,233
31,974
248,874
9,474
239,400
68,20068,20068,200(13,816)7
7335,241
641,307Non-consolidated Statement of Income (From March 1, 2021 to February 28, 2022)
J. Front Retailing Co., Ltd.
(Millions of yen)
Item

AmountOperating revenue
Dividend income
Consulting fee income

10,482
5,000

15,482

General and administrative expense

4,995

Operating profit
Non-operating income
Interest income
Dividend income
Other

10,487
712
44
22

779

Non-operating expenses
Interest expenses
Commitment fees
Loss on valuation of investment securities
Provision of allowance for doubtful accounts
Other

956
574
49
30
151

1,762

Ordinary profit
Extraordinary income
Gain on sale of shares of subsidiaries andassociates

9,505
3,644

Profit before income taxes
Income taxes - current
Income taxes - deferred

3,644
13,149518(1,622)

Profit(Note) Amounts have been rounded down to the nearest one million yen.

- 75 -(1,103)
14,253

Non-consolidated Statement of Changes in Equity (From March 1, 2021 to February 28, 2022)
J. Front Retailing Co., Ltd.
(Millions of yen)
Valuation andtranslation
adjustments

Shareholders’ equity
Retainedearnings

Capital surplus

Share capital

Balance as of March 1,
2021

31,974

Other retained
earnings
Legal capital Other capitalsurplussurplus9,474

Retainedearnings
brought
forward239,601

62,398TreasurysharesTotal shareholders’equityValuationdifference on
available-forsale securities(14,066)

329,382(30)

Total net
assets329,351

Dividends of surplus(8,452)(8,452)(8,452)

Profit14,253

14,253

14,253

(32)

(32)

(32)

Purchase of treasury
shares
Disposal of treasury
shares

(0)

82

82

82

Disposal of treasury
shares for share
distribution trust

(200)

583

383

383

(383)

(383)

(383)

Purchase of treasury
shares by share
distribution trust
Net changes in items
other than shareholders’equityTotal changes during
periodBalance as of February 28,
2022(Note)

38

38

–

–

(200)

5,801

250

5,851

38

5,889

31,974

9,474

239,400

68,200(13,816)

335,2337

335,241

Amounts have been rounded down to the nearest one million yen.

- 76 -

THE AUDIT REPORT OF INDEPENDENT AUDITORS CONCERNING THE CONSOLIDATEDFINANCIAL STATEMENTS (COPY)

Report of Independent Auditors
April 11, 2022
The Board of Directors
J. FRONT RETAILING Co., Ltd.
Ernst & Young ShinNihon LLC
Tokyo office
Kazunori Takenouchi(seal)
Certified Public Accountant
Designated and Engagement Partner
Yoshihisa Shibayama(seal)
Certified Public Accountant
Designated and Engagement Partner
Hiroshi Matsuura(seal)
Certified Public Accountant
Designated and Engagement Partner
OpinionPursuant to Paragraph 4, Article 444 of the Companies Act, we have audited the accompanying consolidated
financial statements, which comprise the consolidated statement of financial position, the consolidated
statement of profit or loss, the consolidated statement of changes in equity and the notes to the consolidated
financial statements of J. FRONT RETAILING Co., Ltd. (the “Company”) applicable to the fiscal year fromMarch 1, 2021 through February 28, 2022.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects,
the financial position and results of operations of the J. Front Retailing Group, which consisted of theCompany and consolidated subsidiaries, applicable to the 15th fiscal year from March 1, 2021 throughFebruary 28, 2022 in conformity with accounting principles with the omission of a part of the disclosure
items required under IFRS as allowed by the latter part of Paragraph 1, Article 120 of the Regulation on
Corporate Accounting.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Auditof the Consolidated Financial Statements section of our report. We are independent of the Company and its
consolidated subsidiaries in accordance with the ethical requirements that are relevant to our audit of theconsolidated financial statements in Japan, and we have fulfilled our other ethical responsibilities inaccordance with these requirements. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion.
Responsibilities of Management and the Audit Committee for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial statements
in conformity with accounting principles with the omission of a part of the disclosure items required under
IFRS as allowed by the latter part of Paragraph 1, Article 120 of the Regulation on Corporate Accounting,and for designing and operating such internal control as management determines is necessary to enable thepreparation and fair presentation of the consolidated financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing whether it isappropriate to prepare the consolidated financial statements on the going concern basis, and disclosing, asapplicable, matters related to going concern in accordance with accounting principles with the omission ofa part of the disclosure items required under IFRS as allowed by the latter part of Paragraph 1, Article 120of the Regulation on Corporate Accounting.
The Audit Committee is responsible for overseeing the Executive Officers’ and Directors’ performance of
duties within the maintenance and operation of the financial reporting process.

- 77 -

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our responsibilities are to obtain reasonable assurance about whether the consolidated financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’sreport that includes our opinion on the consolidated financial statements based on our audit from an
independent point of view. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the decisions of users takenon the basis of the consolidated financial statements.
In accordance with auditing standards generally accepted in Japan, we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:







Identify and assess the risks of material misstatement of the consolidated financial statements, whether
due to fraud or error, and design and perform audit procedures responsive to those risks. Selecting
audit procedures to be applied is at the discretion of the auditor. Obtain audit evidence that is sufficientand appropriate to provide a basis for our opinion.
Consider, in making those risk assessments, internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances, while the purpose of the audit of theconsolidated financial statements is not expressing an opinion on the effectiveness of the Group’s
internal control.
Evaluate the appropriateness of accounting policies used by management and their method of
application, as well as the reasonableness of accounting estimates by management and related notes
thereto.
Conclude on the appropriateness of management’s use of the going concern basis for preparing theconsolidated financial statements and, based on the audit evidence obtained, whether a material
uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability
to continue as a going concern. If we conclude that a material uncertainty exists, we are required to
draw attention in our auditor’s report to the related notes to the consolidated financial statements or, if
the notes to the consolidated financial statements on material uncertainty are inadequate, to express aqualified opinion with exceptions on the consolidated financial statements. Our conclusions are basedon the audit evidence obtained up to the date of our auditor’s report. However, future events orconditions may cause the Group to cease to continue as a going concern.



Evaluate whether the overall presentation of the consolidated financial statements and the notes thereto
are in accordance with accounting principles with the omission of a part of the disclosure items
required under IFRS as allowed by the latter part of Paragraph 1, Article 120 of the Regulation on
Corporate Accounting, as well as evaluate the overall presentation, structure and content of theconsolidated financial statements, including the related notes thereto, and whether the consolidated
financial statements fairly represent the underlying transactions and accounting events.
Obtain sufficient and appropriate audit evidence regarding the financial information of the Company
and its consolidated subsidiaries to express an opinion on the consolidated financial statements. We
are responsible for the direction, supervision and performance of the audit of the consolidated financial
statements. We remain solely responsible for our audit opinion.
We communicate with the Audit Committee regarding the planned scope and timing of the audit andsignificant audit findings, including any significant deficiencies in internal control that we identify during
our audit, and other matters required by auditing standards.
We also provide the Audit Committee with a statement that we have complied with the ethical requirements
in Japan regarding independence that are relevant to our audit of the financial statements, and communicate
with it all relationships and other matters that may reasonably be thought to bear on our independence, andwhere applicable, related safeguards in order to eliminate or reduce obstruction factors.
Conflicts of Interest
We have no interest in the Company and its consolidated subsidiaries which should be disclosed incompliance with the Certified Public Accountants Act.

- 78 -

THE AUDIT REPORT OF INDEPENDENT AUDITORS CONCERNING THE NONCONSOLIDATED FINANCIAL STATEMENTS (COPY)

Report of Independent Auditors
April 11, 2022
The Board of Directors
J. FRONT RETAILING Co., Ltd.
Ernst & Young ShinNihon LLC
Tokyo office
Kazunori Takenouchi(seal)
Certified Public Accountant
Designated and Engagement Partner
Yoshihisa Shibayama(seal)
Certified Public Accountant
Designated and Engagement Partner
Hiroshi Matsuura(seal)
Certified Public Accountant
Designated and Engagement Partner
OpinionPursuant to Item 1, Paragraph 2, Article 436 of the Companies Act, we have audited the accompanying nonconsolidated financial statements, which comprise the non-consolidated balance sheet, the non-consolidated
statement of income, the non-consolidated statement of changes in equity, the notes to the non-consolidated
financial statements and the related supplementary schedules of J. FRONT RETAILING Co., Ltd. (the“Company”) (the “non-consolidated financial statements, etc.”) applicable to the 15th fiscal year fromMarch 1, 2021 through February 28, 2022.
In our opinion, the non-consolidated financial statements etc. referred to above present fairly, in all material
respects, the financial position and results of operations of the Company applicable to the 15th fiscal year
from March 1, 2021 through February 28, 2022 in conformity with accounting principles generally acceptedin Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the Auditof the Non-consolidated Financial Statements, Etc. section of our report. We are independent of theCompany in accordance with the ethical requirements that are relevant to our audit of the consolidated
financial statements etc. in Japan, and we have fulfilled our other ethical responsibilities in accordance withthese requirements. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our audit opinion.
Responsibilities of Management and the Audit Committee for the Non-consolidated Financial Statements,
Etc.
Management is responsible for the preparation and fair presentation of the non-consolidated financial
statements etc. in accordance with accounting principles generally accepted in Japan; this includes themaintenance and operation of such internal control as management determines is necessary to enable thepreparation and fair presentation of non-consolidated financial statements etc. that are free from material
misstatement, whether due to fraud or error.
In preparing the non-consolidated financial statements etc., management is responsible for assessing
whether it is appropriate to prepare the non-consolidated financial statements etc. on the going concern basisof accounting and disclosing, as applicable, matters related to going concern in accordance with accounting
principles generally accepted in Japan.
The Audit Committee is responsible for overseeing the Executive Officers’ and Directors’ performance of
duties within the maintenance and operation of the financial reporting process.
Auditor’s Responsibilities for the Audit of the Non-consolidated Financial Statements, Etc.
Our responsibilities are to obtain reasonable assurance about whether the non-consolidated financial
statements etc. as a whole are free from material misstatement, whether due to fraud or error, and to issue- 79 -

an auditor’s report that includes our opinion on the non-consolidated financial statements etc. based on our
audit from an independent point of view. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the decisions ofusers taken on the basis of the non-consolidated financial statements etc.
In accordance with auditing standards generally accepted in Japan, we exercise professional judgment andmaintain professional skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of non-consolidated financial statements etc.,
whether due to fraud or error, and design and perform audit procedures responsive to those risks.
Selecting audit procedures to be applied is at the discretion of the auditor. Obtain audit evidence thatis sufficient and appropriate to provide a basis for our opinion.
Consider, in making those risk assessments, internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances, while the purpose of the audit of the nonconsolidated financial statements etc. is not expressing an opinion on the effectiveness of the Group’s
internal control.
Evaluate the appropriateness of accounting policies used by management and their method of
application, as well as the reasonableness of accounting estimates by management and related notes
thereto.

Conclude on the appropriateness of management’s use of the going concern basis for preparing thenon-consolidated financial statements etc. and, based on the audit evidence obtained, whether amaterial uncertainty exists related to events or conditions that may cast significant doubt on theGroup’s ability to continue as a going concern. If we conclude that a material uncertainty exists, weare required to draw attention in our auditor’s report to the related notes to the non-consolidated
financial statements etc. or, if the notes to the non-consolidated financial statements etc. on material
uncertainty are inadequate, to express a qualified opinion with exceptions on the non-consolidated
financial statements etc. Our conclusions are based on the audit evidence obtained up to the date of
our auditor’s report. However, future events or conditions may cause the Group to cease to continue
as a going concern.



Evaluate whether the presentation of the non-consolidated financial statements etc. and the notes
thereto are in accordance with accounting standards generally accepted in Japan, as well as evaluate
the overall presentation, structure and content of the non-consolidated financial statements etc.,
including the related notes thereto, and whether the non-consolidated financial statements etc. fairly
represent the underlying transactions and accounting events.
We communicate with the Audit Committee regarding the planned scope and timing of the audit andsignificant audit findings, including any significant deficiencies in internal control that we identify during
our audit, and other matters required by auditing standards.
We also provide the Audit Committee with a statement that we have complied with the ethical requirements
in Japan regarding independence that are relevant to our audit of the financial statements, and communicate
with it all relationships and other matters that may reasonably be thought to bear on our independence, andwhere applicable, related safeguards in order to eliminate or reduce obstruction factors.
Conflicts of Interest
We have no interest in the Company which should be disclosed in compliance with the Certified Public
Accountants Act.

- 80 -

THE AUDIT REPORT OF AUDIT COMMITTEE MEMBERS (COPY)

Audit Report
The Audit Committee has audited the performance of duties by Directors and Executive Officers of J.
FRONT RETAILING Co., Ltd. (the “Company”) during the 15th fiscal year from March 1, 2021 throughFebruary 28, 2022. We hereby report as follows regarding the method and results of the audit.
1. Method and Content of Audits
With respect to the resolution of the Board of Directors concerning the matters stipulated in Item 1 (b) and(e), Paragraph 1, Article 416 of the Companies Act, as well as the system (the internal control system)
developed based on such resolution of the Board of Directors, we received regular reports regarding thestatus of establishment and operation of such system from Directors, Executive Officers and employees,
and others, requested explanations as necessary, expressed opinion thereon, and executed audits throughthe following methods.
(i) In accordance with audit policies stipulated by the Audit Committee and the division of duties, etc., Audit
Committee Members, in coordination with the departments in the Company related to internal control,
participated in key meetings, received reports from Directors, Executive Officers, and others regarding thematters related to the performance of their duties, and when necessary, requested explanations of thosereports. Audit Committee Members also reviewed key decision documents, and conducted surveys of theoperations and assets of the head office and of other principal places of business. Further, regarding
subsidiaries, Audit Committee Members worked to communicate with Directors, Executive Officers, Audit& Supervisory Board Members, and other parties at those subsidiaries, and when necessary conducthearings with them regarding their business.
(ii) Additional consideration was given to the basic policy set forth in Item 3 (a), Article 118 of theRegulation for Enforcement of the Companies Act and activities set forth in Item 3 (b), Article 118 of thesame Ordinance, as noted in the Business Report, based on the status of deliberations at the meeting of theBoard of Directors and other key meetings.
(iii) While monitoring and reviewing the audit of the Accounting Auditor to ensure they maintained an
independent position and conducted their audits fairly, Audit Committee Members received reports fromthem regarding the performance of their duties, and when necessary, asked for further explanation regarding
those reports. Audit Committee Members also received notice from the Accounting Auditor in accordancewith “the system for ensuring appropriate execution of their duties” (as enumerated in each Item of Article
131 of the Regulation on Corporate Accounting) in compliance with the “Quality Control Standards
Relating to Auditing” (adopted by the Business Accounting Deliberations Council in October 28, 2005),
and, where necessary, Audit Committee Members requested further explanation regarding that notice.
Based on the above methods, Audit Committee Members proceeded to review the Business Report with the
supplementary schedules, the non-consolidated financial statements (which consist of the non-consolidatedbalance sheet, the non-consolidated statement of income, the non-consolidated statement of changes inequity, and the notes to the non-consolidated financial statements) with the supplementary schedules, andthe consolidated financial statements (which consist of the consolidated statement of financial position, theconsolidated statement of profit or loss, the consolidated statement of changes in equity, and the notes tothe consolidated financial statements) for the current fiscal year.

2. Audit Results(1) Results of Audit of Business Report, etc.
(i) The Audit Committee confirms that the Business Report and the supplementary schedules conformed tothe applicable laws and regulations, and the Articles of Incorporation, and that they accurately present thesituation of the Company.
(ii) With respect to the performance of duties by Directors and Executive Officers, the Audit Committee
found no improper acts or important violation of applicable laws and regulations or the Articles of- 81 -

Incorporation.
(iii) The Audit Committee confirms that decisions by the Board of Directors regarding the Company’s
internal control systems are fair and adequate, and found no areas that require mention regarding thedescription of the internal control systems in the Business Report and the performance of duties by Directors
and Executive Officers. Regarding the response to the infection, comprehensive measures to prevent
infections have been thoroughly implemented on a continual basis. The Audit Committee confirms that theCompany and all the Group companies are working together to strengthen the crisis control system.
(iv) The Audit Committee confirms that the basic policy regarding those who control the determination of
the Company’s financial and operational policies, as noted in the Business Report, is fair and adequate. The
Audit Committee confirms that activities set forth in Item 3 (b), Article 118 of the Regulation for
Enforcement of the Companies Act, as noted in the Business Report, are in line with this basic policy, are
not harmful to the common interest of the Company’s shareholders, and are not intended to maintain thepositions of corporate officers of the Company.
(2) Results of Audit of Non-consolidated Financial Statements and Supplementary Schedules
The Audit Committee confirms that the methods used and results achieved by the Accounting Auditor, Ernst& Young ShinNihon LLC, are fair and adequate.
(3) Results of Audit of Consolidated Financial Statements
The Audit Committee confirms that the methods used and results achieved by the Accounting Auditor, Ernst& Young ShinNihon LLC, are fair and adequate.
April 11, 2022
Audit Committee
J. FRONT RETAILING Co., Ltd.
HAKODA Junya(seal)
Chairperson of Audit Committee
HAMADA Kazuko(seal)
Audit Committee Member (full-time)
SATO Rieko(seal)
Audit Committee Member
SEKI Tadayuki(seal)
Audit Committee Member(Note) Audit Committee Members, namely, HAKODA Junya, SATO Rieko and SEKI Tadayuki are
Outside Directors as prescribed in Item 15, Article 2 and Paragraph 3, Article 400 of the Companies
Act.

- 82 -