Convocation Notice59th Annual Shareholders’ Meeting
From January 1, 2021 to December 31, 2021
■ Date and time

March 18 (Friday), 2022
at 10:00 a.m. (Doors open at 9:00 a.m.)■ Venue∙ The Tokyo venue above is the only venue this year.
Pre-registration is required to attend and is available for only up to 300
shareholders based on raffle drawing.
∙ The proceedings of this Shareholders’ Meeting will be broadcasted in realtime on the Internet.

Tsuru Room, Banquet Floor, the Main Building,Hotel New Otani Tokyo Details on the back cover

Listed on TSE 1st Section

TRUSCO NAKAYAMA Corporation

Securities code

Environmental conservation
through direct shipmentsfrom the wholesaler to users
Clients
Internet order companies
Home centers
Tool and hardware dealers

Users
Production factories
Construction sites
General consumers

Through direct shipments to users

Convocation Notice ofthe 59th Annual
Shareholders’ Meeting

Halving delivery lead times
Halving packing materials
Halving freight fees
Halving environmental load
Halving work load

Convocation Notice

Convocation
Notice of the59th Annual
Shareholders’Meeting

Business Report

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Reference Data

P9

P 33

Contents
Convocation Notice of the 59th Annual
Shareholders’ Meeting......................................................... 1
Organization Chart ............................................................... 3
Guide to the Exercise of Voting Rights .............................. 7
Business Report for the 59th Period ................................. 9
Our Initiatives in the 60th Period ..................................... 14
Outside Directors Interview .............................................. 21
Corporate Executives (List of Executive) ........................ 22

Current Status and Policies of the Company ................. 23
Corporate Executives (Executives’ Remuneration) ....... 24
ESG Activity Report 38....................................................... 25
Reference Materials for Shareholders’ Meeting(Proposal Details)............................................................... 33
Introducing Our Corporate Auditors ................................ 41
Frequently Asked Questions ............................................. 42
Responses to COVID-19 Infection..................................... 43“Tiresome work will make people grow”
One would naturally loathe tiresome work and, if possible, would like to avoid it.
But looking back, one would realize that accomplishing such a work fostered one’s own growth. I recommend thatyou get along with tiresome work to enhance you resourcefulness and lead your life with confidence and vigor.
President Nakayama’s key
phrase for 2022

1

Convocation Notice of the 59th Annual Shareholders’ Meeting4-28-1 Shimbashi, Minato-ku, Tokyo
Tesuya Nakayama, President

GAMBARE!! JAPANESE MONODZUKURII would first like to express my gratitude for your warm support.
Trusco Nakayama has made efforts to improve the convenience of customers by continuing its aggressive capital
investment in distribution facilities and equipment as well as in digitalization and by strategically strengthening its
expansion of its product lineup and inventories in order to accurately meet the needs of Monozukuri sites for awide variety of items in small lots.
The key phrase for this year is “Tiresome work will make people grow.” One would naturally loathe tiresome work.
With the advances of digital technologies, much of tiresome work has been eliminated, but some tiresome work
remains unsolvable even with digital technologies.
At the present time in which “smart work” is a buzzword, I do not intend to acclaim tiresome work, but one should
think about what one might gain by accomplishing a tiresome work. More dependable a person is, more tiresome
work seems to be drawn to that person. Half of your worries would be gone if you realize that the extent oftiresome work surrounding you is the evidence that you are seen to be dependable by others.
Resourcefulness means the ability to solve difficult problems, and solving difficult problems is the foremost typeof tiresome work. We would like to get along with tiresome work to enhance our resourcefulness and walk
forward with confidence and vigor.
Keeping in mind our policy that “Business must serve people and society,” we will continue to work to be acompany needed by our customers and markets in 2022.

Decided Matters upon the Convocation
Notice is hereby given that the 59th Annual Shareholders' Meeting of Trusco Nakayama (the "Company") will be held
as described below and that you are invited to attend the Meeting. If you cannot attend the Meeting please review
the following "Reference Materials for Shareholders' Meeting" and return the enclosed Voting Form indicating yourvote "for" or "against" each of the proposals or access the Company's website for voting, which is indicated on the
Voting Form, and exercise your voting rights via the Internet by 5:30 p.m., Thursday, March 17, 2022.

1 Date and TimeAt the 55th
Anniversary Hall,
3rd floor, Tokyo
Head Office

March 18 (Friday), 2022, at 10:00 a.m. (Doors open at 9:00 a.m.)*Pre-registration is required to attend and is available for only up to 300 shareholders
based on raffle drawing. For details, please see the attached leaflet.
Venue: Tsuru Room, Banquet Floor, the Main Building,
2 Place
Hotel New Otani Tokyo, 4-1 Kioi-cho, Chiyoda-ku, Tokyo*The Tokyo venue above is the only venue this year.
Reason: To consolidate venues into Tokyo and also to strengthen the system to allow
more shareholders to participate in the Meeting from anywhere by using an
online shareholders’ meeting format (live streaming).
*If the venue becomes unavailable because of the spread of the COVID-19 infection, we
will announce it on the Company's website.
Shareholders attending the meeting on the day of the Annual Shareholders' Meeting arekindly requested to confirm any change in advance before the meeting.
3 Matters Constituting the Purpose of the Meeting
Matters to Be Reported
Reports on the Business Report, Consolidated Financial Statements,
Financial Statements, and the results of the audit of the Consolidated Financial
Statements by the accounting auditor and the Board of Auditors forthe 59th Period (from January 1, 2021 to December 31, 2021)
Matters to Be Resolved
Proposal No. 1: Election of Seven (7) Directors
Proposal No. 2: Election of Two (2) Corporate Auditors
Proposal No. 3: Partial Amendment to the Article of Incorporation
4 Guide to the Exercise of Voting Rights
Please refer to “Guide to the Exercise of Voting Rights” on ▶
P7–8.

Notes: 1. Please bring this Notice of Convocation as a material for proceedings and present the enclosed Voting Form to the receptionist at the venue of the Meeting.
2. Of the documents to be provided, the Company has posted the [Matters concerning the Current Situation of the Corporate Group (Major Lenders)], the [Matters concerning Company
Executives (Major Activities of Outside Officers for the Current Fiscal Year, Matters concerning the Independence of Outside Officers, and Special information about Outside Officers)],
the [Situation of Accounting Auditors], the [Systems and Policies of the Company (Matters concerning the Implementation of the System to Ensure the Propriety of the Company's
Operations, Basic Policy concerning the Control of the Company, and Policy concerning the Decision of Dividends from Surplus)] of the Business Report, the [Consolidated
Statements of Changes in Shareholders' Equity] and [Notes to Consolidated Financial Statements] of the Consolidated Financial Statements, and the [Statements of Changes inShareholders' Equity] and [Notes to Non-consolidated Financial Statements] of the Financial Statements on the Company's website (http://www.trusco.co.jp/ "Finance" → "IR
Library" → "Shareholders Communication") pursuant to the provisions of the law and Article 15 of the Articles of Incorporation. Therefore, they are not stated in this Notice ofConvocation. For reference, the Business Report, Consolidated Financial Statements, and Financial Statements attached to this Notice of Convocation are part of the documentsthat were audited by the corporate auditor and the accounting auditor upon preparing the audit report.
3. In the event that an item in the reference materials for the Meeting, the Business Report, Consolidated Financial Statements, or Financial Statements must be corrected by the day before
the Meeting, the correction will be notified by posting the corrected item on the Company's website (http://www.trusco.co.jp/ "Finance" → "IR Library" → "Shareholders Communication").
4. In the event that the chairperson is unable to attend the meeting, the acting chair shall act as the chairperson in accordance with the predetermined order.

Convocation Notice of the 59th Annual Shareholders’ Meeting2

Convocation Notice

TRUSCO NAKAYAMA Corporation

P1
Business Report(Securities code: 9830)
March 2, 2022

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Reference Data

To our shareholders

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Organizational Chart*1 Board Brain
At TRUSCO Nakayama, we call outside directors “Board Brains.” This term alludes
to our hope that they will provide advice and support based on their abundant
experience and knowledge, and contribute to the Company’s development.

Convocation Notice

As of January 1, 2022

AdvisorBusiness Report

P1

Takashi Nakai
AdvisorOutsideBorn January 16, 1955
66 years old (43 years and 9 months with the Company)
Number of shares held: 32,200 shares
Career Summary
1978: Joined the Company
1996: Tokyo Branch Office Manager
1998: General Manager, Corporate Planning
Department
1999: Executive Officer & Head of the
Corporate Planning Division
2003: Executive Officer & Head of the
Corporate Planning Division
2004: Director & Division Head, Distribution Dept.
2007: Executive Director & Division Head,
Product Division
2017: Senior Executive Director & Head ofCorporate Management Division
2019: Senior Executive Director & Assistant to
the President
2020: Advisor (present)

Kenichi Saito

Born November 15, 1949
72 years old
Number of shares held: 3,200 shares
Career Summary
1975: Joined McKinsey & Company
1996: Founded ForeSight & Company
President (present)
2016: Outside Director of the Company(present)
2017: Founded the Society for
Problem-Solving Proficiency
Representative Director of theSociety for Problem-Solving
Proficiency (present)*1 Board Brain
ForeSight & Company
Representative Director

What is an advisor?
The Company offers a post of advisor to a person who is qualified to provide
advice to responsible persons drawing from his or her past knowledge andexperience. While the mandatory retirement age for the officers of the Company
is 65, advisors may at their choice continue to work until the age of 70.

Kuniaki Hagihara
Outside Director*1 Board Brain
Chairman, Hagihara
Industries Inc.

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Division

Reference Data

Atsushi Kazumi
Director
Head of Corporate
Management Division,
Head of Digital Strategy
Department

Concurrent post

P 33

Born September 10, 1970
51 years old (28 years and 9 months with the Company)
Number of shares held: 4,000 shares
Career Summary
1993: Joined the Company
2001: Head of Tsuchiura Sales Office
2002: Head of Kanazawa Sales Office
2006: Osaka Branch Manager
2010: Head of Catalog/Media Section & Head of Dottokuru Section
2013: Head of e-Commerce Sales Department
2014: Head of e-Business Sales Department
2017: Executive Officer & Head of e-Business Sales Department in charge of Mail Order2017: Executive Officer & Head of Information Systems Department
2019: Executive Officer & Head of Information Systems Division
2019: Director & Head of Information Systems Division
2020: Director & Head of Corporate Management Division, Head of Digital Strategy Division, Head of Digital Promotion
Department
2021: Director & Head of Corporate Management Division, Head of Digital Strategy Division (present)

Corporate Management DivisionCorporate Planning Department

Newlyestablished Personnel Department(93 employees in total)*2

Digital Strategy Division

Administration Department

Accounting Department

Information Systems Department

New appointment

Atsushi Shimozu

Tomoya Kita

Mikio Adachi

Tetsuhiro Mori

Takayuki Kimura

General Manager,
Corporate Planning
Department

General Manager,
Personnel Department

General Manager, Administration
Department and Section
Manager, Property Section

General Manager,
Accounting Department

General Manager,
Information Systems
Department

Born December 25, 1978
43 years old (19 years and 9 months
with the Company)
Number of shares held: 1,300 shares
Career Summary
2002: Joined the Company
2011: Branch Office Manager, Edogawa
Branch2013: Deputy Section Manager,
Management Planning Section
2014: Section Manager, Administration
Section, Legal Affairs Section, andVehicle Operation Management
Section, Osaka Head Office2021: Section Manager, Corporate
Planning and PR/IR Section
2021: General Manager, Corporate
Planning Department and Section
Manager, Corporate Planning and
PR/IR Section
2021: General Manager, Corporate
Planning Department (present)
Corporate Planning Section
Secretarial Section
PR/IR Section
Sustainability Promotion Section(12 employees)

Born December 24, 1978
43 years old (20 years and 9 months
with the Company)
Number of shares held: 900 shares
Career Summary
2001: Joined the Company
2010: Branch Office Manager, Kofu
Branch2016: Planet Tokai Logistic Center
Manager
2019: Section Manager, Human
Resource Development Section,
Secretarial Section, and CSR
Section2021: Section Manager, Human
Resource Development Section,
Secretarial Section, CSR Section,
and Recruitment Section
2022: General Manager, Personnel
Department (present)

Born September 20, 1969
52 years old (27 years and 9 months
with the Company)
Number of shares held: 2,600 shares
Career Summary
1994: Joined the Company
2002: Branch Office Manager, HC Nagoya Sales Office
2004: Branch Office Manager, HC Niigata Sales Office
2007: Branch Office Manager, HC Tokyo Branch
2008: Office Manager, Matsudo Sales Office
2011: Planet South Kanto Logistic
Center Manager
2013: Planet North Kanto Logistic Center Manager
2016: General Manager, Factory Sales
Department (Chubu)
2018: General Manager, Factory Sales
Department (Shinshu, Hokuriku, and Tokai)
2019: General Manager, Administration Department
2021: General Manager, Administration Department
and Section Manager, Property Section (present)

Born March 27, 1966
55 years old (3 years and 1 months with
the Company)
Number of shares held: 400 shares
Career Summary
2019: Joined the Company
2019: Manager of the Financial
Management Section
2021: General Manager of the
Accounting Department (present)

Personnel Section
HR Support Section
Recruitment Section
Human Resource Development
SectionHealthcare Section(19 employees)

Tokyo Management Section
Osaka Management Section
Property Section
TRUSCO Resort and Spa Hakone
Kyoto Kaguraoka Rengetsuso
TRUSCO Resort and Spa Karuizawa (27 full-time and 11 part-time employees)

Accounting Section
Finance Section(18 employees)

Born June 26, 1973
48 years old (23 years and 9 months
with the Company)
Number of shares held: 4,300 shares
Career Summary
1998: Joined the Company
2011: Branch Office Manager,
Yamaguchi Branch
2012: Branch Office Manager, Ube
Branch2013: Section Manager, Human
Resources Development
Section, Section Manager,
Secretary Section, and Section
Manager, Environmental
Management Section
2019: General Manager, Information
Systems Department (present)
IT Planning Section
System Management Section
Infrastructure/Network
Management Section
Data Management Section(38 employees)

Trusco Nakayama Health Insurance Association

Akiko TaniManager

Born May 6, 1981
40 years old (8 years and 8months with the Company)(2 temporarily transferred employees)

3

Convocation Notice of the 59th Annual Shareholders’ Meeting*2 The total number of employees at each division includes
the number of temporarily transferred employees.

Born December 24, 1958
63 years old (40 years and 9 months with theCompany)
Number of shares held: 1,260,600 shares
Career Summary
1981: Joined the Company
1984: Director
1987: Managing Director
1991: Representative Director and Senior
Managing Director
1994 Representative Director and President(present)

Directors

Takako Suzuki

Born March 5, 1962
59 years old
Number of shares held: 2,500 shares
Career Summary
1984: Joined Nissan Motor Co., Ltd.
2001: Joined LVJ Group Co., Ltd. (currently
Louis Vuitton Japan Co., Ltd.)
2009: Representative Director, Chardin Co., Ltd.
2010: Joined S.T. Corporation
2013: President and Chief Operating Officer ofS.T. Corporation
Director, Chardin Co., Ltd. (present)
2020: Outside Director of the Company (present)
2021: Chairperson of the Board and President &Chief Operating Officer of S.T. Corporation(present)

Outside Director*1 Board Brain
Chairperson of the Board and President & Chief Operating
Officer of S.T. Corporation

P1
Business Report

Born August 19, 1953
68 years old
Number of shares held: 3,200 shares
Career Summary
1976: Joined Hagihara Industries Inc.
1984: President of Hagihara Industries Inc.
2010: President & CEO of Hagihara IndustriesInc.
2016: Chairman of Hagihara Industries Inc.
2016: Outside Director of the Company(present)
2018: President of Toyo Heisei Polymer Co.,
Ltd. (present)
2020: Outside Director, Wavelock Holdings
Co., Ltd. (present)
2021: Chairman, Toyo Heisei Polymer Co.,
Ltd. (present)
2022: Chairman, Hagihara Industries Inc.
(present)

Convocation Notice

Representative Director and President

Tetsuya Nakayama

Representative Director and President

P9

Heads
Senior Executive Officer
Head of Product Division

Reference Data

August 4, 1985
Tatsuya Nakayama Born
36 years old (8 years and 9 months with the Company)

Number of shares held: 2,200 shares
Career Summary
2013: Joined the Company
2018: Branch Office Manager, Internet Sales Tokyo Branch
Division 1
2019: General Manager of Corporate Planning Department
and Accounting Department
2021: Senior Executive Officer & General Manager of the
Product Division (present)

P33

Product Division (150 employees in total)(52 employees in total)
Digital Promotion Department

Tokyo Product Department

Newly

Osaka Product Department established

New appointment

Overseas ProductDepartment

New appointment

Newlyestablished

Sales Planning Department /e-Business Sales Department

Concurrent post

Atsuhiro Yamanaka

Fumiaki Matsubara Koshiro Aoyama Norihiro Higashi

Masashi Yamamoto

General Manager,
Digital Promotion Department

General Manager,
Tokyo Product Department

General Manager,
Osaka Product Department

General Manager,
Overseas Product Department

General Manager,
Sales Planning Department ande-Business Sales Department

Born September 21, 1974
47 years old (23 years and 9 months
with the Company)
Number of shares held: 1,600 shares
Career Summary
1998: Joined the Company
2008: Branch Office Manager,
Tsuchiura Branch
2012: Branch Office Manager,
Minamiosaka Branch
2018: Section Manager, Sales
Planning Section
2021: General Manager, Digital
Promotion Department (present)

Born July 21, 1980
41 years old (17 years and 9 months
with the Company)
Number of shares held: 1,000 shares
Career Summary
2004: Joined the Company
2018: Branch Office Manager, Fukui
Branch2021: Osaka Branch Manager,
South Osaka Branch2022: General Manager, Tokyo
Product Department (present)

Born February 23, 1976
45 years old (23 years and 9 months
with the Company)
Number of shares held: 2,800 shares
Career Summary
1998: Joined the Company
2008: Branch Office Manager,
Kumagaya Branch
2012: Branch Office Manager,
Toyama Branch
2016: Section Manager, Tokyo PB
Product Section and PB
Product Design Section
2021: Deputy General Manager,
Osaka Product Department
2021: General Manager, Osaka
Product Department andSection Manager, Orange
Book Section
2022: General Manager, Osaka
Product Department (present)

Born October 16, 1978
43 years old (17 years and 9 months
with the Company)
Number of shares held: 1,700 shares
Career Summary
2004: Joined the Company
2013: Branch Office Manager,
Oyama Branch
2015: Representative Office
Manager, Representative
Office Germany
2022: General Manager, Overseas
Product Department (present)

Born May 27, 1973
48 years old (25 years and 9 months with theCompany)
Number of shares held: 2,800 shares
Career Summary
1996: Joined the Company
2004: Office Manager, Hamamatsu Sales
Office2010: Head of Corporate Auditor's Office
2010: Section Manager, Administration
Section2014: Planet Tohoku Logistic Center Manager
2018: General Manager, Tokyo Metropolitan
Area Distribution Department
2019: General Manager, Overseas
Department and Marketing Department
2020: General Manager, e-Business Sales
Department
2022: General Manager, Sales Planning
Department and e-Business Sales
Department (present)

Digital Promotion Section
UX Platform Development Office(12 employees)

Tokyo NB Product Section
Tokyo PB Product Section
PB Product Design Section
Tokyo Supplier Development
Section(47 employees)

Osaka NB Product Section
Osaka PB Product Section
PB Quality Assurance Section
Stock Management Section
Osaka Supplier Development
Section
Product DB Platform
Development Office
Orange Book Section
Orange Book.com Section
Customer Consulting Section(86 employees)

Overseas Purchase Section
Germany OfficeTaiwan Office (to be established)
Thailand Office (to be established)(14 employees)

Sales Planning Section
Naojiro Section
MRO Stocker Promotion
Section(8 employees)

Internet Sales Tokyo
Internet Sales Osaka
MRO Supply Tokyo(57 full-time and 3
part-time employees)

Convocation Notice of the 59th Annual Shareholders’ Meeting4

Convocation Notice

General Meetingof Shareholders
Board ofCorporate Auditors

Born March 30, 1956
65 years old
Number of shares held: 18,600 shares
Career Summary
1978: Joined the Kyowa Bank, Ltd. (currently
Resona Bank, Ltd.)
2003: Chief Credit Officer of the Osaka No. 3
Loan Department, Resona Bank, Ltd.
2007: Full-time Corporate Auditor of theCompany (present)

Board of Directors
Representative
Director and President

Business Report

P1

Internal Auditing Office(3 employees)

Masaki Matsuda
Full-time Corporate Auditor

P9

Akira Takada

Full-time Corporate Auditor

Division

Reference Data

Kazuo Nakai

Born July 7, 1969
52 years old (28 years and 9 months with the Company)
Number of shares held: 4,000 shares
Career Summary
1993: Joined the Company
2002: Office Manager, HC Niigata Sales Office
2004: Branch Office Manager, HC Osaka Branch
2008: Section Manager, Personnel Section
2008: Section Manager, Personnel Section & Healthcare Section
2013: General Manager, Corporate Planning Department
2017: Executive Officer & General Manager, Corporate Planning Department
2019: Executive Officer & Head of Corporate Management Division
2019: Director & Head of Corporate Management Division
2020: Director & Head of Sales Division
Executive in charge of TRUSCO NAKAYAMA CORPORATION (THAILAND) LIMITED (present)
Executive in charge of PT. TRUSCO NAKAYAMA INDONESIA (present)
2021: Director & Head of Sales Division, General Manager of Home Center Sales Department &Distribution Department
2022: Director & Head of Sales Division (present)

Director
Head of Sales Division

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Sales Division
Factory Sales Department

New appointment

New appointment

New appointment

Kiyonori Unto

Yoshiki Kimura

Yutaka Yoneda

Toshiharu Sakai

Masatoshi Fujita

General Manager,
Factory Sales Department
East Japan

General Manager,
Factory Sales Department
Tokyo Metropolitan Area

General Manager,
Factory Sales Department
Chubu Japan

General Manager,
Factory Sales Department
Kinki

General Manager,
Factory Sales Department
West Japan

Born February 9, 1962
59 years old (35 years and 1 months
with the Company)
Number of shares held: 5,300 shares
Career Summary
1986: Joined the Company
1996: Office Manager, Fukui Sales Office
2004: Office Manager, Chiba Sales Office
2008: Branch Office Manager, Okayama
Branch2011: General Manager, Factory Sales
Department (East Japan)
2013: General Manager, Overseas
Department
2019: General Manager, Factory Sales
Department and Distribution
Department East Japan
2022: General Manager, Factory Sales
Department East Japan (present)

Born September 2, 1980
41 years old (18 years and 9 months
with the Company)
Number of shares held: 1,100 shares
Career Summary
2003: Joined the Company
2012: Branch Office Manager, Kurume
Branch2015: Branch Office Manager, Tosu
Branch2016: Section Manager, Public Relations
Section, IR Section, andCorporate Design Section
2017: Section Manager, PR/IR Section
2019: Branch Office Manager, Osaka
Branch2022: General Manager, Factory Sales
Department Tokyo Metropolitan
Area (present)

Born November 6, 1975
46 years old (22 years and 9 months
with the Company)
Number of shares held: 2,600 shares
Career Summary
1999: Joined the Company
2005: Office Manager, Shiga Sales Office
2010: Section Manager, Recruitment
Section2013: Section Manager, Corporate
Planning Section
2017: General Manager, Tokyo ProductDepartment
2022: General Manager, Factory Sales
Department Chubu (present)

Born August 17, 1976
45 years old (22 years and 9 months
with the Company)
Number of shares held: 1,700 shares
Career Summary
1999: Joined the Company
2008: Office Manager, HC Tottori Office
2010: Office Manager, Yonago Sales
Office2011: Head of Corporate Auditor's Office
2012: Section Manager, Public Relations
Section, IR Section, andCorporate Design Section
2016: Branch Office Manager, Tosu
Branch2020: Branch Office Manager, Nagoya
Branch2022: General Manager, Factory Sales
Department Kinki (present)

Born March 10, 1981
40 years old (18 years and 9 months
with the Company)
Number of shares held: 300 shares
Career Summary
2003: Joined the Company
2016: Branch Office Manager, Miyazaki
Branch2016: Branch Office Manager,
Utsunomiya Branch
2021: Branch Office Manager, Komaki
Branch2022: General Manager, Factory Sales
Department West Japan (present)

Sapporo, Hachinohe, Sendai
Akita, Koriyama, Mito
Utsunomiya, Isezaki, Niigata
Niigata-kita, Okaya, Ueda
(142 full-time and 23 part-time
employees)

Kashima, Omiya, Satte
Chiba, Matsudo, Tokyo
Keihin, Atsugi, Shizuoka
Fuji(154 full-time and 31 part-time
employees)

5

Toyama, Kanazawa, Fukui
Hamamatsu, Nagoya, Okazaki
Komaki, Yokkaichi(120 full-time and 28 part-time
employees)

Convocation Notice of the 59th Annual Shareholders’ Meeting

Ryuo, Kyoto, Osaka
Higashi-Osaka, Minami-Osaka, Kobe
Himeji(115 full-time and 9 part-time
employees)

Yonago, Okayama, Hiroshima
Fukuyama, Ube, Shunan
Tokushima, Takamatsu, Matsuyama
Fukuoka, Kokura, Tosu
Nagasaki, Kumamoto, Oita
Kagoshima, Okinawa(142 full-time and 31 part-time
employees)

The numbers in parenthesis ( ) indicate the number of employees
as of January 1, 2022.

Hiroho Kamakura
Part-time Corporate Auditor

Born January 27, 1947
74 years old
Number of shares held: 4,200 shares
Career Summary
1971: Joined Tohmatsu Aoki & Co. (currently
Deloitte Touche Tohmatsu LLC)
1973: Registered as a Certified Public
Accountant
2012: Part-time Corporate Auditor of theCompany (present)Part-time Corporate Auditor of Yushin
Precision Equipment Co., Ltd. (present)
2013: Part-time Corporate Auditor of Fujio
Food System Co., Ltd. (present)
2018: Part-time Corporate Auditor,
SymEnergy Inc. (present)

Hiroaki Imagawa
Executive Officer

Born January 22, 1963
58 years old (35 years and 9 months with the Company)
Number of shares held: 20,000 shares
Career Summary
1986: Joined the Company
1996: Head of Maebashi Sales Office
1997: Head of Ota Sales Office
1998: Tokyo Branch Manager
2004: Executive Officer & Head of NB Product Division
2007: Director & Head of Sales Division
2013: Executive Officer & Head of Factory
Sales Department (East)
2016: Executive Officer & Head of Accounting Department
2019: Executive Officer & Head of Corporate Planning
Department, Head of Accounting Department
2019: Executive Officer, Head of Factory Sales Department,
Head of Distribution Department, Tokyo Metropolitan Area
2022: Executive Officer (present)

P1
Business Report

Born January 3, 1958
63 years old
Number of shares held: 1,400 shares
Career Summary
1981: Joined Nomura Securities Co., Ltd.
2001: Head of IB Consulting Office of Nomura
Securities Co., Ltd.
2009: Managing Director of IB Business
Development Department of Nomura
Securities Co., Ltd.
2012: Director of Nomura Investor Relations
Co., Ltd.
2015: Advisor of Nomura Investor Relations
Co., Ltd.
2018: Full-time Corporate Auditor of theCompany (present)

Convocation Notice

Executive Officer

Company Auditor

Mr. Imagawa will assume office as Full-time Corporate Auditor subject tothe approval of shareholders at the 59th Annual Shareholders’ Meeting of
the Company scheduled for March 18, 2022.

P9

Heads

Reference Data

December 7, 1971
Hideki Naoyoshi Born
50 years old (27 years and 9 months with the Company)
Number of shares held: 4,000 shares

Career Summary
Director
Head of Distribution Division 1994: Joined the Company

2003: Head of Amagasaki Sales Office
2007: Head of Kokura Sales Office
2010: Head of Corporate Auditor's Office
2011: Head of Corporate Planning Section
2013: Head of Information Systems Department
2017: Executive Officer & Head of Information Systems
Department
2017: Executive Officer & Head of Distribution Division
2019: Director & Head of Distribution Division
2021: Director & Head of Product Divisions, Head ofDistribution Division
2021: Director & Head of Distribution Division (present)(917 employees in total)*2Home Center Sales Department

Overseas Department

Distribution Division
Distribution Reorganization
Department(1,634 employees in total)

Distribution Department

New appointment

Shu Matsui
General Manager, Home Center
Sales Department and Branch
Office Manager, HC Tokyo Branch
Born August 17, 1979
42 years old (18 years and 9 months
with the Company)
Number of shares held: 600 shares
Career Summary
2003: Joined the Company
2012: Branch Office Manager, Fukui Branch
2015: Branch Office Manager, HC Tokyo
Branch2022: General Manager, Home Center
Sales Department and Branch
Office Manager, HC Tokyo Branch(present)
HC Tokyo, Okazaki, Fukuoka
HC Osaka, and Okinawa* Including three branches underconcurrent post at branches of the
Factory Sales Department(33 full-time and 1 part-time
employees)

New appointment

Naotsugu Kamijo

Masaya Okada

Masato Otani

Takanori Hirayama

General Manager,
Overseas Department

General Manager,
Distribution Reorganization
Department

General Manager,
Distribution Department
East Japan

General Manager,
Distribution Department
West Japan

Born August 17, 1976
45 years old (21 years and 9months with the Company)
Number of shares held: 700 shares
Career Summary
2000: Joined the Company
2008: Section Manager,
Recruitment Section
2010: Branch Office Manager,
Itabashi Branch
2015: Planet Tokai Logistic Center
Manager
2016: Planet Saitama Preparation
Room Manager
2018: Planet Saitama Logistic
Center Manager
2021: General Manager, Distribution
Reorganization Department(present)

Born October 24, 1967
54 years old (30 years and 9 months
with the Company)
Number of shares held: 1,800 shares
Career Summary
1991: Joined the Company
2008: Office Manager, Kagoshima
Sales Office
2012: Branch Office Manager,
Chiba Branch
2014: Section Manager, Personnel
Section & Healthcare Section
2018: General Manager, Factory
Sales Department Kinki
2019: General Manager, Factory
Sales Department andDistribution Department Kinki
2021: General Manager, Factory Sales
Department and Distribution
Department Chubu and Kinki
2022: General Manager, Distribution
Department East Japan (present)

Born April 20, 1975
46 years old (22 years and 9 months
with the Company)
Number of shares held: 2,800 shares
Career Summary
1999: Joined the Company
2005: Office Manager, Akashi Sales
Office2010: Section Manager, IT Planning
Section2015: Branch Office Manager,
e-Business Tokyo Branch
Division 1
2016: Branch Office Manager,
Internet Sales Tokyo Branch
Division 1
2018: Section Manager, Personnel
Section & Healthcare Section
2022: General Manager, Distribution
Department West Japan(present)

Born November 29, 1977
44 years old (18 years and 9 months
with the Company)
Number of shares held: 1,900 shares
Career Summary
2003: Joined the Company
2014: Branch Office Manager, Kashima
Branch2017: Section Manager, Overseas Sales
Section2020: General Manager, Overseas
Department and Section Manager,
Overseas Sales Section
2022: General Manager, Overseas
Department (present)
Overseas Sales Section* Liaison function with overseas
subsidiaries(6 employees)

Overseas subsidiaries Officer in charge at TRUSCO NAKAYAMA Corporation: Kazuo Nakai
TRUSCO NAKAYAMA CORPORATION (THAILAND) LIMITED PT. TRUSCO NAKAYAMA INDONESIA

Kazuaki Harada

P33

Yohei Takuno

Representative Director and President

Representative Director and President

Born November 8, 1980
41 years old (18 years and 9months with the Company)
24 employees(3 temporarily transferred employees
and 21 local employees)
Director: Naotsugu Kamijo

Born May 16, 1986
35 years old (11 years and 9months with the Company)
20 employees(3 temporarily transferred employees
and 17 local employees)
Corporate Auditor: Naotsugu Kamijo

P (Planet), BUC (Backup Center), and STC (Stock Center) are abbreviations
for our distribution centers.

Logistics Planning Section
Delivery Management Section
Logistics Platform Development
Section and P Aichi Preparation
Section(13 employees)

P Hokkaido, P Tohoku, P North
Kanto
P Saitama, P East Kanto, P
South Kanto
TOKYO BUC
HC East Japan Distribution Center
Utsunomiya STC
Oyama STC
Omiya STC
(240 full-time and 550 part-time
employees)

P Tokai, P Nagoya, P Shiga
P Osaka, P Kobe, P Sanyo
P Kyushu
HC West Japan Distribution
CenterHC Kyushu Distribution Center
Toyohashi STC, East Osaka STC
Nara STC, Okayama STC
Takamatsu STC, Hakata STC
Kurume STC(257 full-time and 572 part-time
employees)

Convocation Notice of the 59th Annual Shareholders’ Meeting6

Convocation Notice

Guide to the Exerciseof Voting Rights
Voting Right Exercise Methods
Please exercise your voting rights by referring to ▶
P33–40 of the Shareholders’ Meeting Reference Documents. There
are the following methods to exercise your voting rights.

Business Report

P1

Exercise of voting rights by

Exercise of voting rights via the

Exercise of voting rights byattending the Meeting*Internet

post (in writing)

Please access the website specified by theCompany and exercise your rights by following
the instructions on the screen.

Please indicate your vote “For” or “Against”
each proposal on the Voting Form, cut off
the right section along the indicated line,
hide your personal information using the
sticker, and post the form.

Date and time of the meeting

Time limit for the exercise of voting rights

March 18, 2022 (Friday)
10:00 a.m.
(reception will start at 9:00 a.m.)Time limit for the
exercise of voting rights

March 17, 2022 (Thursday)(5:30 p.m.)

March 17, 2022 (Thursday)
5:30 p.m. (latest arrival time)

Pre-registration is required to attend and isavailable for only up to 300 shareholders
based on raffle drawing.
URL: https://form.run/@trusco59
For details, please see theWebsite forattached leaflet.

Reference Data

P9

pre-registration

P 33

Guide to Exercising Voting Rights
via a Smartphone

Guide to Exercising Voting Rights
via the Internet

1. Scan the QR code

1. Access the website for exercising voting rights.
https://www.web54.net

Scan the "Log-in QR Code to
the Website for Exercising
Voting Rights for Smartphones"at the lower right of theenclosed Voting Form with yoursmartphone or tablet device.

Click*QR Code is a registered trademark of Denso Wave Incorporated.

2. Log-in.

2. Select the Voting Right

Please enter the "Code for the Exercise of Voting Rights"
indicated on the enclosed Voting Form.

Exercise Methods

Access the URL displayed to open thewebsite screen for exercising voting
rights. There are two methods ofexercising voting rights.

Voting Form・I will vote "for" all company proposals.
・I will instruct each agenda item separately.

3. Enter "For" or "Against."

Click

Enter "For" or "Against" according
to the instructions on the screen.
If there is no problem on theconfirmation screen, click the"Exercise with this item" tocomplete your exercise.

Please call the number below for inquiries on how to operate a PC,
smartphone, or mobile phone when exercising voting rights via the Internet.
Dedicated phone number for stock transfer agency web support of
Sumitomo Mitsui Trust Bank:

0120-652-031(9:00 a.m. to 9:00 p.m., excluding
year-end and New Year's holidays)

3. Enter "For" or "Against."

Enter the initial password on the next screen, and then, set the
password that you will actually use.

Enter "For" or "Against" according to the instructions on the screen
thereafter.

Notes

1. If you exercise your voting rights twice, via the Internet and by post (in writing), we
will treat the exercise of your voting rights via the Internet as effective.
2. If you exercise your voting rights more than once via the Internet, we will treat thelast exercise of your voting rights as effective.
3. Exercising voting rights using a PC, smartphone, etc., may not be possible
depending on your Internet environment. In addition, exercising voting rights may
not be possible with some models of mobile phones.

*Those attending the Meeting as a proxy shareholder (only one other shareholder holding voting rights of the Company) are requested to submit a written proof of their rightof proxy at the Meeting reception desk.

7

Convocation Notice of the 59th Annual Shareholders’ MeetingConvocation Notice

Convocation Notice

How to Fill in the Voting Form
Please enter your vote for each proposal by referring to ▶

P33–40 of the Shareholders' Meeting Reference Documents.

P2

P1● If you do not indicate your vote for each
proposal, your votes will be treated asaffirmative votes.
(Correct) (Incorrect)● Your vote will be
invalid if you circle
both “賛(For)” and “否(Against).”P9
Reference Data

Circle “賛(For)” if you agree.
Circle “否(Against)” if you disagree.

Business Report

Attention

Relationship between Prior Voting and Voting on the Day

P33

Pre-registration is required to attend and is available for only up to 300 shareholders based on raffle drawing.
For details, please see the attached leaflet.
1. If voting early via the Internet (PC) or smartphone (refer to ▶

P7) and attending the Meeting(Example)
Voted “Against”
a proposal inearly voting

Voted “For” theproposal using theBallot Paperat the Meeting

The vote will bechanged andcounted as “For.”

For・ Against

For ・ Against

For ・ Against

2. If attending the Meeting without voting early(Example)If you vote on a Voting
Form you havebrought to the venue,
it will be deemedinvalid.

Voted “For” theproposal using theBallot Paperat the Meeting

The vote will becounted as “For.”

For ・ Against

For ・ Against
At the Meeting, you will be
asked to place your Ballot
Paper in the ballot box.

Voting on the Day
On the basis of the idea that it is important tojudge “For” or “Against” after seeing thepresentations, discussions, persons, etc., on the
day of the Meeting, we hand Ballot Papers to theshareholders who attend the meeting. We
aggregate the results of the votes by ourshareholders on the day of the Meeting anddisclose them in the notice of resolution or
extraordinary reports.
Please note that shareholders who view themeeting online will not be able to vote on the day
Ballot Paper at the Meetingof the meeting.

Open Judge System (OJS) on the President
We consider the results of the votes on the day of the Meeting
concerning the President by shareholders who have heard theBusiness Report and Q&As to be important evaluation
indicators of the President as the “OJS on the President.”
Concerning the results, a notice of resolution will be postedon the Company's website on March 22 (Tuesday), 2022,
after the closing of the Meeting. The results of the "OJS on
the President" for the previous period (58th Period) arepresented on
P35.

Convocation Notice of the 59th Annual Shareholders’ Meeting8Convocation NoticeBusiness Report
59th Period

P1

P 33

We have continued aggressive capital investments in distribution facilities,
distribution equipment, and digital technologies in order to accurately satisfy theneeds for goods in small quantity and large variety, which are required bymanufacturing customers. In response to the increasing number of items that we
supply, we strategically strengthened our immediate delivery system by enhancing
inventories and revamping the distribution network.

From January 1, 2021 to December 31, 2021
(Attached Documents)

Business Report

Reference Data

P9

Continue to satisfy the needs ofcustomers for convenience improvement

Operating results for the 59th period ended December 2021
Consolidated

Net salesGrossmarginSelling,
general andadministrative
expenses

Nonconsolidated

Consolidated
Nonconsolidated

Ordinary
incomemillion yen

228,906 million yen

21.0

200

187

180

164

+7.4%

167
+14.6

yoy

-0.5
pt
yoy

％

△

yoy

35,104 million yen

+1.4%

6,929

+5.6%

million yen

million yen

12,891

million yen

12,903 million yen

Consolidated

13,572

Nonconsolidated

13,596 million yen

million yen

4.7△-0.5pt21.0%

Nonconsolidated

Nonconsolidated

Net sales (100 million yen)
Yoy change (%)

+7.3

★

+1.4%

206 205

191 193

171

+9.4

+10.0

+6.9

Yoy change(%)

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

18

18

23

21

18

22

20

19

20

21

20

20

(-1) (±0) (+2) (±0) (±0) (±0) (-1) (+1) (±0) (-1) (+1) (±0)
★Number of business days in the 59th period (yoy change)yoy

Nonconsolidated

yoy

1,015
1,004

yoy

Average daily net sales

932
890

905

+16.2%

857

yoy

+17.4
%
yoy

59th period (current fiscal year)
58th period (previous fiscal year) 1,031

1,050
1,029

911

+17.0
%
yoy

★

+16.9%(Unit: Million yen)
59th period(current fiscal year)

813

1,026

956

911 924 900

937 933
58th period(previous fiscal year)

874 919846
826 836820

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

18

18

23

21

18

22

20

19

20

21

20

20

(-1) (±0) (+2) (±0) (±0) (±0) (-1) (+1) (±0) (-1) (+1) (±0)
★Number of business days in the 59th period (yoy change)

175.97

Nonconsolidated

176.45 yen+53.83

Annual dividend
per share

35.50

+5.00

Sales by category of goods and percentage of total sales (Figures in parentheses () indicate yoy change

11,603

Net income

11,635 million yen

Cutting tools

Nonconsolidated

3.1%

million yen

Production
processing goods

7.6%

yoy

+44.9%Net income
per shareyoy+43.9%
yoy

Construction goods

11.5%

Work supply

18.6%

yen

+54.54
yoy

yoy

yen

yoy

Percentage of total)

Hand tool

7,221 million yen

17,362 million yen

26,291 million yen

42,595 million yen

37,684 million yen（+10.6%）（+7.4%）（+6.9%）（+7.6%）（+9.5%）

Environmental
safety equipment

40,415 million yen（+5.0%）

17.6%

Distribution andstorage equipment

25,150 million yen（+10.3%）

11.0%

Research management
equipment

4.3%

Office and housing
facility equipment

9.1%

Other

9,866 million yen

20,765 million yen

1,552 million yen（+5.7%）（+6.9%）（-18.4%）

Note: All figures stated in the business report from P14 onwards are rounded down to the nearest one million yen.

9

Net sales(100 million yen)

+15.9

+12.3

+10.3
+5.3

+3.8

1.0

184

Consolidated

Net income
attributable toowners of parent Consolidated

Nonconsolidatedyoy

35,383

Consolidated

Trend of monthly net sales
236

+7.5%

Consolidated

Incl.)
Depreciation Consolidated

Operatingincome229,342

Nonconsolidated

Convocation Notice of the 59th Annual Shareholders’ Meeting

16.5%

0.7%

Convocation NoticeBusiness flow (figures in parentheses ( ) indicate yoy changes)

Ordinary income

Japanese manufacturers(100 million yen)

1,646

1,717

92

100

incomeWe conducted highly specialized sales
activities by, for example, introducing“MRO Stocker,” a system of “use first, pay
later” that has been around for many years
in Japan for medicine, but for tools, andstrengthening direct shipments to users.

59th period 60th periodPlan*e-business route
Net sales

Percentage ofconsolidated net sales

44,6683,407

Ordinary income(100 million yen)

446

34

2,662

500

37

(+222
companies)

Net sales

59th period 60th period
Plan*Home center route
Net sales

183

4

194

Net sales

5

Ordinary
income59th period 60th periodPlan*Overseas
manufacturers

Net sales
Ordinary income(100 million yen)

16

304
(+92
companies)-

0.3

million yen（+8.1%）
million yen（+56.9%）

WWe strengthened proposal forin-store improvement to our clients,
including pro-tool shops that target
such users as construction workers.

0.7%

Percentage ofconsolidated net sales

1,694
–32

21

Net sales

0.1

Ordinary
income(loss)

59th period 60th period
Plan*

Current fiscal year

8.0%

As home center companies arestrengthening their EC business, we
actively proposed services supported
by our extensive inventories of around
500,000 items and distribution
facilities.

Current fiscal year

Consolidated

million yen（+8.6%）

Percentage ofconsolidated net sales

18,373455

Overseas route

million yen（+16.3%）

We strengthened the coordination of
our product database of around 2,760
thousand items with clients’ systems.

Ordinary income(100 million yen)

19.5%

In order to enable the same day
shipment of goods for which ourclients received orders from theirusers, we strengthened our unique
distribution services by supporting
packaging styles matched to theirneeds and increasing the number of
product items sold through this route.

Ordinary
incomeCurrent fiscal year

Consolidated

million yen（+17.5% yoy）

Our 27 distribution centers and 29
branches with inventory all over
Net sales Japan increased their inventories tomatch suit market needs to increase
Ordinary convenience for clients.

Current fiscal year

Consolidated

million yen（+5.0%）

million yen（+37.9%）
million yen（ − ）Consolidated net sales include the businessresults of consolidated subsidiaries (TRUSCO
NAKAYAMA CORPORATION (THAILAND)
LIMITED and PT. TRUSCO NAKAYAMAINDONESIA) as well as the sales of theOverseas Department to foreign markets.
The consolidated subsidiaries strengthenedtransactions with existing clients by, forexample, accelerating the provision of productdata to EC companies. They also expanded
transactions with new local clients, including
EC companies and home center companies.

P1
Business Report

164,605
9,239

71.8%

(Infinite)

P9
Reference Data

Net sales

Percentage ofconsolidated net sales

∞

5,527
(+12 companies)

Manufacturers, construction
companies, etc.

Factory route
Consolidated

million yen（+17.4%）

Manufacturers, general
consumers, etc.

（+7.5%）

Businesses conducting outdoor
work, general consumers, etc.

229,342 million yen 13,572

Overseas manufacturers, etc.

Consolidated ordinary income

Machine tool dealers, dealersof welding materials, etc.

Consolidated net sales

Users(Retailers)Internet order companies, etc.

2,966(+314 companies)

Clients(Wholesaler)

General hardware mass
discounters, pro-tool shops, etc.

(Manufacturers)

Overseas dealers, etc.

Suppliers

P33* As the Company plans to apply the “Accounting Standard for Revenue Recognition” (ASBJ Standard No. 29) and other related guidance from the beginning of the 60th period onwards,
the plan figures for the 60th period shown above were prepared by applying the Standard, etc. For this reason, percentage changes from the previous fiscal year are not presented.
Convocation Notice of the 59th Annual Shareholders’ Meeting10Business Report for the 59th Period
Convocation Notice

From January 1, 2021 to December 31, 2021

Business Report

P1

Reference Data

P9

P 33

Changes in assets and profit or loss in the last 10 years
Performance indicators
Fiscal year

52nd period

58th period

59th period

53rd period

54th period

55th period

56th period

FYE March 2014

FYE December 2014
(9 months ended
December)

FYE December
2015

FYE December
2016

FYE December
2017

FYE December
2018

FYE December
2019[Consolidated]FYE December
2020[Consolidated]FYE December
2021
Current fiscal year
[Consolidated]132,295

145,882

114,473

166,565

177,053

195,096214,297

220,674

213,404

229,34250th period

51st period

FYE March 2013

Net sales

Category(Unit: Million yen)
57th periodGrossmargin

20.3%

20.4%

20.9%

21.5%

21.7%

21.2%

21.2%

21.3%

21.5%

21.0%

Selling, general andadministrative
expenses

18,451

19,58815,50422,78824,198

27,114

31,12733,23734,89135,383Operatingincome8,356

10,133

8,477

12,976

14,163

14,276

14,364

13,797

11,017

12,891

Ordinary
income8,311

10,078

8,494

13,211

14,433

14,581

14,642

14,197

11,55913,572

4,818

5,954

5,474

8,242

9,963

10,173

9,722

9,613

8,007

11,603

Net income per share

73.05 yen

90.28 yen

83.01 yen

124.98 yen

151.08 yen

154.28 yen

147.44 yen

145.78 yen

121.43 yen

175.97 yen

Total assets

82,28387,03990,917

97,777

105,836

113,680

120,648

127,478

132,960

142,669

Return on equity
(ROE)

6.0%

7.0%

6.2%

8.7%

9.8%

9.3%

8.3%

7.5%

6.1%

8.4%

Net assets

100,032

109,738

109,917

120,141

128,044

147,363

170,216

196,094

208,854

223,072

Net assets per share

1,247.49 yen

1,319.67 yen

1,378.52 yen

1,482.65 yen

1,604.89 yen

1,723.87 yen

1,829.54 yen

1,933.13 yen

2,016.28 yen

2,163.55 yen

Return on assets
(ROA)

8.4%

9.6%

7.7%

11.5%

11.6%

10.6%

9.2%

7.2%

5.7%

6.3%

Equity ratio

82.3%

79.3%

82.7%

81.4%

82.7%

77.1%

70.9%

65.0%

63.7%

64.0%

Note 4

Net income

Notes 1, 3

Notes 2, 3

Notes: 1. Net income per share is calculated based on the average number of issued shares outstanding during the period after subtracting the average number of treasury shares
outstanding during the period.
2. Net assets per share is calculated based on the number of issued shares outstanding at the end of the period after subtracting the number of treasury shares outstanding at
the end of the period.
3. The Company carried out a 1 to 2 stock split for its common stock on January 1, 2017. Therefore, the amounts of net income per share and net assets per share were
calculated as if the stock split had been carried out at the beginning of the 50th period.
4. The Company started to prepare consolidated financial statements from the fiscal year ended December 2019 onwards. Accordingly, net income attributable to owners ofparent is presented from the fiscal year ended December 2019 onwards.

Trend of cash flows
Fiscal year

(Unit: Million yen)
52nd period 53rd period

Cash flow from operating
activities
Cash flow from investing
activities
Cash flow from financing
activities
Cash and cash equivalents
at the end of the period

55th period

56th period

FYE December
2017

FYE December
2018

FYE December
2019[Consolidated]

9,336

6,459

8,932

6,928

10,99815,06815,926-4,385-5,083-7,806-16,628-18,144-19,707-8,743-4,596-1,288-1,735-1,575-2,262

7,424

12,492

14,558

7,722-2,243

14,476

11,61814,296

10,682

10,412

11,685

18,33032,344

41,449229,342

Net sales(million yen)

42,627

Inventories(million yen)

13,572

Ordinary
income(million yen)

4,486

9,368

3,263

-5,293-5,502-1,187
11,899Trend of net sales, ordinary income, and inventories

214,297 220,674 213,404●● ●●132,295
20,224

20,310114,473
21,7598,311

FY2013

11

10,078FY2014(ended March)

166,565

177,053
29,055

145,882

195,096

43,653

FY201441,542FYE December
FYE December
2021
2020
Current fiscal year
[Consolidated][Consolidated]

37,004
31,84125,017

13,211

14,433

14,581

14,642FY2016FY2017FY201814,1978,494(9 months ended
December)

59th period

54th period

51st period

Net sales (million yen)
Inventories (million yen)
Ordinary income (million yen)

58th period

FYE December
2016

50th period

FYE December 2014
FYE December
FYE March 2013 FYE March 2014 (9 months ended
2015
December)Category

57th period

FY2015

Convocation Notice of the 59th Annual Shareholders’ Meeting

11,559FY2019FY2020Consolidated

Consolidated

FY2021
Current FY
Consolidated

Planet Saitama Increase the shipping capacity of I-Pack® [high-speed automated packaging and shipping lines]● Facilities introduced in the current fiscal year
Before increase
Quantity① I-Pack lines

2② GAS units for I-Pack®
(Sorting system)

2®

After increase

Capacity

Quantity

Capacity

Injection of
8,000 parcels
per day

Injection of
15,200 parcels
per day

6

I-Pack® [high-speed automated packaging and③ I-Pack® worksites
1019
shipping lines]● Location: Satte, Saitama
300 sorting④ Destination sorting1● Site area: 14,297 tsubo
robot
sessions per hour
● Total floor area: 12,915 tsubo● Total investment in the 59th period: Approx. 270 million yen<Capacity>
Shipping capacity: 720cs/h (1 line), for about 24 persons
Centers that have introduced : Planet Tohoku, Saitama, Tokai, and Osaka (3 lines at Planet Saitama and 1 line
at each of other centers)

Planet Aichi New construction plan
We acquired land in Kita-Nagoya, Aichi for theconstruction of a new distribution center. The center
will be called Planet Aichi and can stock 1 million
items of inventory to contribute to our efforts toincrease convenience for clients.
By making the full use of digital and mechanicaltechnologies, we will acquire the highest level ofcompetitiveness that is unparalleled by othercompanies and use the high logistics capability toachieve higher business results.

To reduce environmental load, we
provided cooperation for verification● Location: Kita-Nagoya, Aichi
tests of weeding by goats.
(Land readjustment project site in the West of
Okimura in Kita-Nagoya)● Site area: 12,595 tsubo● Total investment amount: Approx. 20 billion yen (under planning)● Name of the asset: Honmachi Central Building● 4-2-5 Honmachi, Chuo-ku, Osaka City, Osaka● Site area: 313 tsubo● Total floor area: 3,150 tsubo● Acquisition price: Approx. 4.6 billion yen

We have acquired land and a building in Osaka City,
Osaka for the relocation of our Osaka Head Office. By
relocating to Honmachi, the central office area of
Osaka, we will aim to improve convenience forcommuting and the awareness of the Company. The
land and building of the current Osaka Head Office willbe transferred to a third party for the effective use ofmanagement resources.
The relocation of Osaka Head Office is schedule forthe fiscal year ending December 2024.
Honmachi Central Building

Financing

Internetdisclosure

P9

P33

Osaka Head Office Building Relocation plan

The Company raises funds by way of long-term andshort-term borrowings from financial institutions to continue
to invest in distribution facilities and digital technologies forthe purpose of increasing convenience for clients.
As of the end of the 59th period (December 31, 2021), thebalance of cash and deposits amounted to 41.4 billion yen(an increase of 9 billion yen from the previous fiscal year).
The Company has not raised new funds during the current
fiscal year. (The short-term borrowings of 17 billion yen
remain outstanding over peMajor
riods as the same amount is▶
lendersrefinanced continuously.)

P1

3

Business Report

Facility

Reference Data

We have introduced distribution equipment
such as I-Pack®. As the procurement ofgoods via Internet shopping is more widelyused in manufacturing, the needs for direct
shipments to users are rapidly increasing.
As direct shipments from the wholesaler tousers can cut packing materials andenvironmental load by half, we cancontribute not only to higher conveniencefor clients by shortening delivery leadtimes, but also to environmental
preservation.

Convocation Notice

Major capital investments in the current fiscal year

Financing table
Fiscal year 55th period 56th period 57th period 58th period 59th period Balance ofborrowings at
FYE December
2017

FYE December
2018

Long-term
borrowings 10 billion yen

15 billion yen－－

10 billion yen

15 billion yen

Category

Short-termborrowings
Total

FYE December
2019

FYE December
2020

FYE December the end of the2021
59th period－ *10 billion yen－

35 billion yen

17 billion yen－－

17 billion yen

17 billion yen

10 billion yen－

52 billion yen*The financing by way of long-term borrowings during the 58th period ended December 2020
was conducted in view of the possibility of an economic crisis under the COVID-19 pandemic.
Convocation Notice of the 59th Annual Shareholders’ Meeting

12Business Report for the 59th Period
Convocation Notice

From January 1, 2021 to December 31, 2021

Developments and results of business activities
Progress and plan on key performance indicators of the Company

Key performanceindicators
DigitalBusiness Report

P1

Web estimate request ratio
System order intake ratio
Number of PB product items(total number of items)
Available TRUSCO Orange Book.
Com items
Total number of suppliers
Number of domestic suppliers

P9

Products

Reference Data

Automated estimate ratio

Number of overseas suppliers
TRUSCO Number of listed manufacturers
OrangeBook Number of listed items

Number of inventory items
Incl.) Number of items stocked
automatically
Total number of items ininventory

P 33

Inventory value
Number of corporate customers

Sales

Number of customer accounts

Logistics

Number of companies connectedto Orange Commerce
Number of companies that haveintroduced MRO Stocker
Number of items delivered
directly to users
Number of direct deliveries tousers
Personnel expenses perreceiving/shipping
Inventory shipment ratio
Number of hired vehicle delivery
runs
Number of TRUSCO delivery
runs
Percentage of TRUSCO delivery
runs
Delivery lead time
Average overtime hours per
month
Average age (full-time
employees)
Average salary (full-time
employees)
CareerArea

HR

Logistics
Branch office managers,

Salary ofcenter managers, head officepersons in section managers, etc.
managerial Division heads, generalmanagers, deputy generalpostsmanagers (excluding officers)

Total number of employees (including
officers and part-time employees)
Number of part-time employees

60th period

59th period

58th period

FYE December 2020
Previous fiscal year

FYE December 2021
Current fiscal year

FYE December 2022
Plan−（+10.1）（+5.8）
8.1 %
18.2 %
24.0 %−（+6.0）（+4.3）
36.7 %
42.7 %
47.0 %（+0.8）（+1.4）（+1.7）
83.9 %
85.3 %
87.0 %（+8,200）（+11,800）（+10,500）
67,70079,50090,000（+316,179）（+423,667） 5,050,000（+2,289,113）
2,337,220
2,760,887（+115）（+314）（+254）
2,652
2,966
3,220
（+108）（+222）（+198）
2,440
2,662
2,860
（+7）
（+92）
（+56）
212
304
360
（+75）
（+97）
（+162）
1,851
1,948
2,110
（+31,000）（+37,000）（-8,000）
471,000
508,000
500,000（+50,237）（+57,528）（+50,036）
442,436499,964
550,000−（+4,529）（+6,306）
2,965
7,494
13,800− 48,787,614（+2,832,108） 53,600,000（+4,812,386）
45,955,506
41,542 million yen （-2,111）
42,627 million yen （+1,085）
43,760 million yen （+1,133）
（-77）
（+12）
（+53）
5,515
5,527
5,580
（+669）（+2,011）（+1,439）
27,55029,561
31,000（+104）（+675）（+358）
1,367
2,042
2,400
（+47）
（+282）（+1,080）
47
329
1,409
（+197,017）（+1,173,239） 3,800,000（+963,608）
1,663,153
2,836,392（+282,910）（+677,072） 4,000,000（+603,714）
2,719,214
3,396,286
−
（-7）
（-6）
124
117
111
（+0.5）（+0.3）（+0.2）
91.0 %
91.3 %
91.5 %
（-15）
（+1）
（-7）
160
161
154
（+12）
（+7）
（+10）
110
117
127
（+4.8）（+1.4）（+3.1）
40.7 %
42.1 %
45.2 %−−−−
20h 06min 53 sec−±（-11.2）（-0.5）
（ 0）
14.9
14.4
14.4
−
（+0.2）（+1.2）
38.4
39.6
−
−
（-4）
6.19〈6.56〉million yen （-36） 6.15〈6.53〉million yen−−（+3）
7.21〈7.68〉million yen （-37） 7.24〈7.72〉million yen−−（-5）
6.01〈6.38〉million yen （-41） 5.96〈6.33〉million yen−−（-5）
4.61〈4.81〉million yen （-31） 4.56〈4.76〉million yen−−（-8） 11.17〈12.00〉million yen（-11）
11.28〈12.11〉million yen−

14.46〈15.72〉million yen（-52）

14.58〈15.87〉million yen

（+12）

2,786
1,100

（-10）

2,906
1,264

（+120）（-28）（+164）

−
−
−

−
−
−

Notes: 1. Figures in parentheses ( ) indicate changes from the previous fiscal year.
2. Average salary (full time employees) includes the salary of executive officers.
3. Figures in parentheses < > indicate the amount of salary including financial bonds The Company pays retirement allowance annually as “financial bonds” rather
than paying it as a lump sum retirement payment at the time of retirement.
4. The total number of employees includes officers, part-time employees, temporarily transferred employees and local employees of subsidiaries.

13

Convocation Notice of the 59th Annual Shareholders’ MeetingOutlook for the 60th period ending December 2022 and beyond

Consolidated
operating results
Net sales
Gross margin
Selling, general and administrative expenses
Incl.) Depreciation
Operating income
Ordinary income
Net income attributable to owners of parent
Net income per share
Annual dividend per shareand large variety, which are required by manufacturing customers. We forecast
that selling, general and administrative expenses will amount to approximately
37.4 billion yen in total as we expect increases in freight and packing expenses
due to an increase in the number of shipments corresponding to the increasein net sales, as well as in expenses for the resumption of various events that
had been suspended due to the effect of the COVID-19 pandemic. As for the
consolidated financial results for the next fiscal year, we forecast net sales of
243.5 billion yen, an ordinary income of 14.6 billion yen, a net income
attributable to owners of parent of 9,960 million yen, a net income per share of
151.04 yen, and an annual dividend per share of 38.00 yen. Our sales budget
is formulated by collecting projections from branch office managers and taking
into consideration the effect of various sales activities.

59th period

60th period

FYE December 2021
Current fiscal year

FYE December 2022
Plan

Consolidated

Consolidated

229,342 million yen (+7.5%)
21.0% ( 0.5pt)
35,383 million yen (+1.4%)
6,929 million yen (+5.6%)
12,891 million yen (+17.0%)
13,572 million yen (+17.4%)
11,603 million yen (+44.9%)
175.97 yen (+54.54 yen)(+5.00 yen)35.50 yen-

243.5 billion yen［246,169 million yen］Note 3

P9(−)Note 2

(−)
21.2%
37,470 million yen (−)
6,853 million yen (−)
14,250 million yen (−)
14,600 million yen (−)
9,960 million yen (−)( 24.93 yen)
151.04 yen(+2.50 yen)
38.00 yen
Note 2
Note 2

P33

Note 2
Note 2
Note 2
Note 2-

Notes: 1. Figures in parentheses ( ) indicate changes from the previous fiscal year.
2. As the Company plans to apply the “Accounting Standard for Revenue Recognition” (ASBJ Standard No. 29) and other related guidance from the beginning of
the 60th period onwards, the plan figures for the 60th period shown above were prepared by applying the Standard, etc. For this reason, percentage changes
from the previous fiscal year are not presented.
3. If the Company were not to apply the accounting standard, etc. mentioned in the preceding note, our planned net sales for the 60th period ending December
2022 would be 246,169 million yen (+7.3% yoy).

To become what we want to be: Capability targets
To be able to always provide the highest level of convenience as a creative company, we
believe that we should prioritize “capability targets,” which clarify what abilities theCompany should develop, rather than “quantitative targets,” such as sales and profit. To
aim to become a company that is always needed by clients and the society, we will
engage in our business while seeking to become what we want to be as depicted by thefollowing statements:
1 We want to be a company with the ability to store 1 million items in inventory by 2030.
2 We want to become a company with the ability to receive orders 24 hours a day
and ship orders 365 days a year.
3 We want to become a company free from out-of-stock items, wrong orders
received, and wrong shipments.
4 We want to become a company without the need for inventory taking.
5 We want to become a wholesaler company with the ability to ship orders directly tousers without stress.
6 We want to become a company with the ability to provide an estimate
instantaneously.
7 We want to become a company with the ability to realize the fastest, shortest, andbest delivery in the industry.
8 We want to become a company with as small environmental load as possible.
9 We want to become a company that actively promotes recycling, reuse, andreturnable initiatives.
10 We want to become a platformer that supports the Japanese manufacturing sector.
11 We want to become a company with the ability to overturn the common sense,
customs, established theories, and standard moves in the industry.

P1

Reference Data

In the next fiscal year, the Company and its consolidated subsidiaries are
expected to face a business environment in which demand for capital
investments will rise in anticipation of the post-COVID-19 era, automotive
production will recover, and demand for production and business machinery,
whose export has been strong, will be maintained at high levels, leading to arecovery of business confidence. However, due to the uncertainties in the
pandemic situation given the repeated resurgence of infection cases in the past
as well as in resource prices, we are forced to be cautious in predicting future
developments as the future economic climate will depend on these factors.
We expect growth in net sales as we will continue aggressive capital
investments in distribution facilities, distribution equipment, and digitaltechnologies in order to accurately satisfy the needs for goods in small quantity

Business ReportManagement challenges to be addressed

Convocation Notice

Initiatives in the 60th Period

Planet Aichi (Kita-Nagoya, Aichi) with the capacity
to store 1 million items in inventory is underdevelopment (12,595 tsubo).

Joetsu Shinkansen
The relocation of HC East Japan Distribution Center(Fukujimashinden, Sanjo City, Niigata) is being
planned (7,958 tsubo) to strengthen the distribution
capability to support home centers.

The introduction of MRO Stocker by manufacturers
all over Japan is in progress.

Convocation Notice of the 59th Annual Shareholders’ Meeting14

Convocation Notice

Initiatives in the 60th Period

To achieve sustainable growth, which enables us to become what we want to be, the Company has identified the following material issues.
We will work on these material issues through our business activities toward the establishment of a sustainable society. Basic Policy andMaterial Issues on Sustainability ▶
P25② Planning and development of productsthat respond to diversifying needs① Total optimization of the supply chain③ Development of environments andpersonnel to enable them to fully
display their personal abilities

Business Report

P1

To become what we want to be: Material issues

Reference Data

P9

Contribute to the reduction of environmental load with one-stop
logistics

Digital Strategy Division’s initiatives ▶
Sales Division’s initiatives ▶
Distribution Division’s initiatives ▶

Strengthen competitiveness through creative product development

Product Division’s initiatives ▶

P17
P19
P20

P18

Provide employee training sessions and programs to give awarenessin various areas

Corporate Management Division’s initiatives
P16▶

④ Environment actions through businessactivities⑤ Contribution to stakeholders and local
communities⑥ Governance based on a stance ofchoosing the proper actions

Assembly services for chain sling available at “Naojiro” repair workshops

The Nakayama Visual Welfare Foundation’s new Nakayama
Memorial HallManagement Conference attended also by department heads

P 33

ESG activity reportSocial ▶
P27

ESG activity report
Environment ▶
P25

ESG activity report
Governance ▶
P31

Total optimization of the supply chain: Realizing the fastest, shortest, and best delivery in the industry.
Distribution platform development project TRUSCO HACOBUne
Based on industry-academia collaboration with Tokai National Higher Education and Research System Nagoya University and capital andbusiness partnerships with GROUND Inc. and Cinnamon Inc., the Company has started an initiative toward the creation of a new distribution
platform to realize the fastest, shortest, and best delivery in the industry by making the full use of AI and latest robots. By creating a new
distribution platform TRUSCO HACOBUne, the Company will aim to further accelerate its digital transformation (DX) including the use of AI
and robots (TRUSCO DX2.0).

data(59 sales bases and 27 distribution bases)
coordination
Capital and business
partnerships

Clients

Users(5,527 companies)(∞ Infinite)

The best productis already there

Suppliers Inventory(2,966 companies)(realized with MRO Stocker)

Data from users(status of operation, work progress status, etc.)

External data
(weather, season, etc.)

IoT

Data

Product data

10 million
items

OrdersAI
Distribution

Delivery

Product inventory

Industryacademia
collaboration

100 million items
Tokai National
Higher
Education andResearch
SystemNagoyaUniversity

Deliverybased onpredicted
demandDeliverybased onpredicted
demandMRO
Stocker

Direct shipments to users
Deliveryformat01

DeliveryformatHiratomo Miyata
GROUND Inc.
Representative Director & CEO

Miku Hirano
Cinnamon Inc.
Representative Director & CEO

Industry-academia collaboration and capital and business partnership ▶

Delivery format 01: User-direct shipment service
Environmental conservation through direct shipmentsfrom the wholesaler to users
The “user-direct shipment service” is a service to ship orders fromclients directly to users from our distribution centers. Direct shipmentsfrom the Company to users will reduce packing materials, fuels, andCO2 and thereby reduce environmental load.

15

02

Seiichi Matsuo
Tokai National Higher Education and Research
System Nagoya University
President

Convocation Notice of the 59th Annual Shareholders’ Meeting

P43

Delivery format 02: MRO Stocker
MRO Stocker
MRO Stocker is a system of “use first, pay later” that has beenaround for many years in Japan for medicine, but for tools. This
service offers an ultimate quick delivery environment that allows for
rapid delivery of needed items to manufacturing sites so that they
are instantly available for use.

Convocation Notice

Corporate Management Division
Becoming a company that is always beof service to clients and society byleveraging people (originality) as astarting point

Business Report

Atsushi Kazumi

P1

Director
Head of Corporate Management Division,
Head of Digital Strategy Division

Toward the realization of our ambitions with ourpeople and digital technologies

A personnel system reform to develop human resources
with independent thinning and strong originality

We believe that the source of competitiveness of TRUSCO is its
originality. To realize our ambitions that “business must serve people
and society,” we will renew our efforts to develop people (originality),
which is the starting point of the realization of ambitions, in the 60th
period. In the first year of such initiatives, we will establish a new
department in charge of personnel affairs, the Personnel Department.
We will also carry out a personnel system reform that will change theawareness and behavior of employees and thereby develop humanresources with the ability to generate original ideas, aiming to increase
competitive advantages of the Company. Leveraging such originality
as a starting point and through digital technologies that offer
overwhelming convenience, we will accelerate our business reformproject to realize the fastest, shortest, and best delivery and “the bestproduct is already there” (TRUSCO HACOBUne). By combing people(originality) and digital technologies to further increase conveniencefor clients, we aim to become a company that is always be of service
to them.

We believe that originality is cultivated by each individual’s ability andaptitude as well as the work environment. The newly established
Personnel Department will introduce a system (talent management
system) and programs (expansion of course areas and the job
challenge program) to enable employees to fully demonstrate theirpersonal abilities and thereby increase employees’ engagement andthe power of human resources of the Company as a while. In order toprovide a work environment in which everybody can work with peaceof mind, we will further enhance our employee benefit programs,
including the paid leave accumulation bank program (▶
P40) andthe infertility treatment leave program (▶
P41) to put in place anenvironment that allows each employee to work with peace of mind.

TRUSCO’s ambitions

Business must serve
people and society
A personnel system reform to introduce a system to enable employees to fully
demonstrate their personal abilities

Strengthen sustainability promotion initiatives

Value

Countries and companies are being subject to increasingly restrictive
requirements to reduce environmental load to the global environment.
We believe that we need to remind ourselves of the fact that each of
us is responsible for creating part of factors to contribute to such load.
Based on this recognition, the Company has established the basic
policy on sustainability (TSV*) as well as the Sustainability Committee
and the Sustainability Promotion Section to promote initiatives
concerning corporate growth and environmental load both internallyand externally (▶
P38).

Business* TSV (TRUSCO Shared Value) is named after TRUSCO+CSV (Creating Shared Value).

Value(Economic value / social value)

Business(TRUSCO HACOBUne)

Digital technologies(Overwhelming convenience)

Digital technologies
PeopleProduct Department

Product DB Platform Development Office,Osaka NB Product Section

Digital Promotion Department
Digital Promotion Section

Carbon Neutral Research Team

People(Originality)
Renew our efforts to strengthen people (originality) and thereby aim torealize our “ambitions”

Corporate Planning Department

Sales Planning

Corporate Planning Section,
Department
Sustainability Promotion Section Sales Planning Section

Distribution Reorganization
Department
Logistics Planning Section

A cross-functional research team is formed to strengthen sustainability
promotion initiatives

Convocation Notice of the 59th Annual Shareholders’ Meeting

16

Reference Data

P5
P9

P33

Convocation Notice

Initiatives in the 60th PeriodBusiness Report

P1

Digital Strategy Division
Realize unchanging requirements ofclients with digital capability

Atsushi Kazumi

Director
Head of Corporate Management Division,
Head of Digital Strategy Division

P9

Suppliers

Clients

2,966 companies

5,527 companies

Issues in
the past

DX1.0

Case
exampleInconvenience Hours to aof fax-based day to receive
transactions
an estimate

Tediouscommunication byphone/fax

Can be used Can receive an
Easy
estimate within conversation
from
about
5
seconds
anywherefrom anywhereAI-based
estimation system“Swift Estimator”

Users
infinite ∞Delivery lead
time: 1 toseveral days

Delivery lead
time: Zero

DX to realize overwhelming speed and convenience

Creating new client experience

To respond immediately to client’s request for an estimate, we haverealized the evolution of our AI-based estimation system “Swift
Estimator.” It took several hours for a client to receive an estimate in
the past, but the system can now provide an estimate within about
five seconds. This has improved both business efficiency and theratio of orders to estimates. To achieve the optimization of inventories
for “an extensive selection of items” and “accurate stocking ofproducts desired by clients,” we conduct item-by-item analysis ofsales data to create and implement a business process to realize amore accurate selection of items and inventory control. We endeavor
to become a company that can respond flexibly to changes by
predicting future business growth, analyzing data more appropriately
in no time, and making timely and accurate business andmanagement decisions.

Distribution

Management

・Shorter delivery lead time・Optimal route・Safety of drivers

・More appropriate
business judgment
・Faster decision making

Data・Sales record
・Receiving/shipping
・Product information
・Weather, etc.

Inventories
・Quantity to prevent
out-of-stock items
・Delivery based on
predicted demand・Appropriate storage
place

Products
・Product development
・Optimal selection of items
・Optimal priceImprove business and services based on various data
Weather andseason data

Delivery

Cinnamon AI

GROUND

Nagoya University

SearchEstimate
OrdersConvocation Notice of the 59th Annual Shareholders’ Meeting

MRO
StockerStrengthen direct
shipments to users

The fastest, shortest, and best delivery; the best product is already there
Future vision: Business process powered by digital technologies

17

Users

SearchEstimate
OrdersInventorydatacoordination

Clients

Status of operation,
production, etc.

Delivery basedon predicted
demandAs a company exclusively acting as a wholesaler, TRUSCO is working
to provide not only clients with higher convenience, but also users
with valuable client experience. MRO Stocker is an innovative service
to realize delivery in zero lead time by combining digital technology
with the “use first, pay later” business model that has been around formany years in Japan for medicine. In addition, by shipping orders
directly to users based on the combination of inventories, material
handling equipment, and digital technologies, we can shorten delivery
lead time for users and improve business efficiency of clients at thesame time.
In 2021, we started the “TRUSCO HACOBUne” project, which is aplatform concept. By using latest digital technologies, such as AI, IoT,
and robots, we aim to provide clients with unique experience that “thebest product is already there.”

Delivery basedon predicted
demand

P 33

To become the Company we want to be, digital capability and its
continuous improvement is essential. The digitalization of the society
as a whole is very important for the supply chain that supports theJapanese manufacturing sector and for the realization of productivity
improvement, quality improvement, and a sustainable society. Bymaking TRUSCO’s digital infrastructure available for use by the entire
supply chain, we believe that we can satisfy unchanging requirementsof clients, such as “the selection of necessary items,” “speedy andreliable delivery,” “reasonable price,” “high convenience,” and“kindness, courtesy, security.”Strengthen accurate and flexible decision
making based on data

Suppliers

Reference Data

Help improve the productivity of supply chain

Convocation Notice

Product Division
Solving issues in the entire supply
chain with unique selection of items
and product data

Business Report

P1

Tatsuya Nakayama Head of Product Division
Senior Executive Officer

We will enhance our unique selection of items to contribute to theresolution of issues faced by the manufacturing sector today and in the
future. For example, TRUSCO will offer a product lineup that anticipates
future trends, such as a wider use of electric vehicles and efforts tobecome carbon neutral, expand its private brand products that epitomize
TRUSCO, and source unique and high-quality foreign products.
A selection of items can lead to convenience only if it is converted to
product data. While increasing the number of product data items fromabout 4.6 million in January 2022 to about 10 million by January 2025, we
will enhance informational content in an easy-to-understand format tomeet the requests of Internet order companies and others.
We will also work with suppliers in initiatives that lead to the resolution ofissues about the entire supply chain by using logistics and IT, such asindividual initiatives that take advantage of TRUSCO’s distribution
network and mutual data coordination, in addition to existing
collaboration with them in terms of catalogues and inventories.
Copyright © MAPAL , All Right Reserved

Enhancing a unique selection of items for the resolution of manufacturing issues

Realizing “whatever necessary is always
available and can be chosen easily”
To realize a state of affairs that whatever necessary for manufacturing is“always available,” we aim to increase the number of domestic andoverseas manufacturers who supply product to us and increase thenumber of items in inventory to 1 million by 2030.
On the other hand, in the glut of various tools in the world, it takes timeand effort for users to choose what is most suitable. We will work to offer
an environment in which users can select their most suitable professional
tools by using digital technologies to enhance new functions andinformational content, including user-specific mini-catalogues, a searchfunction for comparable and equivalent products in Orange Book.Com,
and CO2 emission information related to products and distribution, anddelivery lead time information on backordered items.
Orange Book will be slimed down to cut its pages by half starting from its

2023 version to reduce its environmental load, such as the use of paper
resources and CO2 emissions. It will also be transformed to adopt a
digital hybrid format linked in real time to ample information on theInternet using the QR Code printed on its page.
Inventories
1 million items• Can compare items
from a bird’s eye view
• Also available outside
the Internet environment

Product data
10 million items
Selection of items• Search for comparable/
equivalent items• Information on CO2emissions, etc.

Paper andweb catalogues

Whatevernecessary isalways stocked

P33

Users
Clients
Easy to selectnecessary items

Catalogues will be renewed in a format to take advantage of both paper andweb media

Creating a convenient, safe, and secure
platform that will become an industry standard
It is TRUSCO’s timeless mission to be of service to users and suppliers
by providing them with convenient mechanisms so that they can focus
on their own manufacturing activities. In addition to providing information
to users, we will provide suppliers with various data arising in theplatform to help them improve their manufacturing activities.
Product information generally available now is prepared by various
market players in a variety of formats and expressions based on theirown standards, which is causing inefficiency in the business operationsof user, clients, and suppliers. We aim to improve the efficiency of theentire supply chain by creating a user-friendly product database that will
be available for industry-wide use. In addition, users need to be able touse professional tools suited to the nature of work in a proper manner inorder to safely focus on their manufacturing activities. Aiming to create asafe and secure platform, we will strive to provide information in aneasy-to-understand format to support appropriate selection and use of
items as well to improve their quality.
Improve the convenienceof the entire supply chain
Can choose the bestproduct

Data coordination

Users

Suppliers

Support service
enhancement

Convenient and secure
product data platform

Reference Data

P9

Enhancing the selection of items, product data,and coordination with suppliers

Feedback

Aim to create an environment in which both users and suppliers can focus on
their own manufacturing activities

Convocation Notice of the 59th Annual Shareholders’ Meeting18

Convocation Notice

Initiatives in the 60th PeriodBusiness Report

P1

Sales Division
Aiming to become a supplier neededby clients by accurately understanding
changes in their needs
Kazuo Nakai Head of Sales Division
Director

P9
Reference Data

Propose an optimal solution to clients’ problems
As the business environment changes rapidly, issues faced by clientsare increasingly diverse. To such diverse issues, we propose an
optimal solution out of our management resources, including
products, logistics, and digital technologies, as part of our sales
activities toward their resolution.

P 33

Strengthen our immediate delivery system thatcan be counted on by clients and users
The COVID-19 pandemic has brought about various problems, suchas a shortage of goods due to a stagnation in imports, a shortage ofmaterials due to the reopening of the economy, and price hikes. By
making the use of our overwhelming inventories, we will fulfill our
responsibility to supply goods under any environment.

Products necessary for manufacturing are
immediately available
Our MRO Stocker service can realize a delivery lead time of zero forusers. Clients can focus on sales activities to users as they can
reduce the daily workload of receiving and shipping orders and thenumber of deliveries.

Strengthen the user-direct shipment function
Direct shipments from the Company to users will reduce packing
materials, fuels, and CO2 and thereby reduce environmental load.
They will also contribute to the reduction of delivery work by clientsand the expansion of their sales network to a remote location towhich they cannot deliver products.
* It should be noted that TRUSCO never sell products directly to users.

Strengthen the repair service to promote reuse
We have established the Naojiro Section, a section specialized inrepair services, to strengthen our reuse promotion activities,
including the repair of electric tools and engine equipment,
re-sharpening of blades, and calibration of measuring instruments.
By using the delivery runs of TRUSCO, items needing repair can becollected without packing and shipping work and freight fees.

Introducing a new sales style
Unless interactions in daily sales activities and proposal materials areappropriately stocked and shared internally, clients will likely be
inconvenienced by the absence or change of the sales representativein charge.

Introduction of a centralized client information
system “CRM”

1月上旬再撮影予定

CRM enables anyone in the TRUSCO sales team to respond toinquiries from clients in real time, leading to service quality
improvement.

A regular post-installation business meeting among the user, the client, and a
TRUSCO employee(To the right: Eri Tomokane, Osaka Branch and MRO Stocker Promotion Section)

Working on environmental problems are an
important mission of our corporate activities
As awareness of environmental issues rises, a supplier to the
manufacturing sector is expected to be active in environmental
preservation activities.

Proposing environmentally-friendly products
Demand for products related to electric vehicles and carbon
neutrality is expected to increase going forward. Leveraging ourtransactions with over 2,900 suppliers, we will accelerate the supplyof products to markets related to the environmental industry.

19

Convocation Notice of the 59th Annual Shareholders’ Meeting

A business meeting with a client to solve issues(Nozomi Fukuhara: Osaka Branch and HR Support Section)

Convocation NoticeDistribution Division
Accelerating the transformation of
distribution to pursue ultimate
immediate delivery that no one has
experienced yet

Business Report

P1

Hideki Naoyoshi Head of Distribution Division
Director

Provision of the highest level of distribution services“Highest level” means the highest convenience in the business area ofprofessional tools.
We will further sharpen the uniqueness of our distribution services,
including one-stop procurement enabled by the stocking of a complete
selection of goods and products necessary for manufacturing and theoperation of a nationwide distribution network. By striving to achieve
the sophistication and leveling of the distribution function and actively
trying to expand our services into new distribution DX areas, we aim toprovide the highest level distribution services.

Fundamental improvement of the overall
distribution function

environment of warehouses. What is important is the speed ofresolving such issues. We will establish an organizational structure toenable faster resolution of issues.

Development of human resources who can play arole in the advancement of distribution
The distribution process continues to advance by incorporating, forexample, state-of-the-art digital technologies and control of distribution
equipment. Human resources are the key to the full use of distribution
assets that leads to higher convenience to clients and stronger
distribution function. For this reason, we will strengthen the developmentof human resources to support the Company’s distribution function.

We believe that the source of business development is inventory. By
thoroughly developing the inventory capability and maximizing the potential
of inventories, we work to raise the level of immediate delivery. We will also
raise the accuracy and speed of solving issues that impede conveniencethrough, for example, improvements in business operations and capacity
utilization, to continuously improve the overall distribution function.

Active promotion of the transformation of distribution
We aim to materialize distribution DX enabled by digital technologies,
including the introduction of AI-based sophisticated demand forecast andstate-of-the-art distribution equipment and the visualization of the entre
distribution process. We will promote the transformation of distribution toprovide truly unique services to our clients in close collaboration with ourbusiness partners.
Human
Safety firstresource
development
Highest level of Service
level
distribution
services
Quality andefficiency
Innovation
Strengthening factors to realize the highest level of distribution services

Optimization of the entire distribution
The optimization of the entire process from procurement to supply
leads to the overall optimization of supply chain. We will aim to provide
distribution services as a platformer to support manufacturing.

Speedy resolution of issues
We can strengthen the distribution function by surely resolving, rather
than overlooking or neglecting, actual issues, such as stockout, lackin quantity, wrong delivery, and improvement in the internal

Improving service level by increasing the percentage of full-time employees
among drivers

Always supporting the Japanese manufacturing sector“TRUSCO’s service is really great. Thank you!” We can surely expect
the client’s excitement and joy once we realize ultimate immediatedelivery. It is our aspiration that all employees will always work together
to realize our dream, endeavoring to increase convenience and achieve
the fastest, shortest, and best delivery. We intend to contribute to the
manufacturing industry in Japan through the provision of the best
services that no one has experienced yet by sharpen the uniqueness ofour distribution services with originality and ingenuity.

Distribution where people and mechanisms
continue to grow forever
The distribution function should ideally provide a workplace where
there are abundant tasks on which motivated employees can do theirbest and take as challenges and and both people and mechanisms
continue to grow forever through such challenges. Needless to say, any
situation that threatens employees’ safety is utterly intolerable. We willcontinue to improve the work environment from the perspective ofsafety first and aim to create a distribution workplace to attract aspiring
employees who look ahead to the future.
Convocation Notice of the 59th Annual Shareholders’ Meeting

20

Reference Data

P9

P33

Convocation NoticeInterview with
Outside Directors

Interview video

Business Report

P1

Reference Data

P9

P 33

Kenichi Saito

Takako Suzuki

Kuniaki Hagihara

Outside Director Board Brain (BB)

Outside Director Board Brain (BB)

Outside Director Board Brain (BB)

Representative Director,
ForeSight & Company

Chairperson of the Board andPresident & Chief Operating Officer,
S.T. Corporation

Director and Chairman, Hagihara
Industries Inc.

At TRUSCO Nakayama, we call outside directors “Board Brains” or “BB” for short. This term alludes to our hope that they will provide advice
and support based on their abundant experience and knowledge, and contribute to the Company’s development. Generally speaking, outside
directors’ main role is to prevent scandals from an external viewpoint. However, as the Company has formulated a highly transparent, uniquegovernance system, we prioritize their contribution to the Company’s sustainable growth and corporate value enhancement. We had aninterview with our outside directors on, among others, their roles and challenges faced by the Company.

Q1

Please tell us about your activities in the 59th period.
SuzukiAs I am the President of a manufacturer of consumer goods, I have provided recommendations based on a manufacturer’ s perspectivethat all decisions should be made from the client’ s perspective. For example, regarding the improvement of TRUSCO Orange Book, I
recommended that TRUSCO Orange Book be prepared based on the true understanding of how end-users use it and what they expectfrom it. It is only natural that over the years of production, an internal perspective tends to take precedent. Therefore, I asked questions that
remind the Company of its origin, such as how it should be in the next year and 10 years from now.

Q2

What challenges should the Company address to achieve sustainable growth?
Saito
I have an impression that the general perception is that the post-COVID era will be characterized by the reversal of deterioration, rather thaneconomic recovery. Statistically speaking, the older a listed company is, the lower the growth rate. As companies with significant history tends
to be constrained by their past successful experience, TRUSCO should always consider how to secure new growth. Moreover, how to achieve
new growth should be learned from its clients and should not be determined by the Company solely based on its own idea. It is necessary foreach employee to have a sense of ownership and act from the client’s viewpoint. As many of TRUSCO employees are growth-oriented
persons, I expect them to connect their own growth with the growth of Japan. TRUSCO regards itself as a wholesaler. However, it may wish
to start to think about what the value to end-users is without being constrained by the identity as a wholesaler by changing its perception froma mere seller of products to a seller of values.

Q3

Tell us about your thoughts on the Company’s business strategies and its unique growth strategy
designed to realize “what we want to become” in 10 years (five years).
Hagihara
From the perspective of business model evolution, I think that it is important for TRUSCO to deepen its core technologies, such as creating
overwhelming confidence and brand strength, distribution capability, and selection of products. By collaborating with its suppliers and clients,
TRUSCO can strengthen its core technologies and create an organization where the Company and its suppliers and clients can learn fromeach other and growth together. It is important for TRUSCO to consider how to create new businesses based on its existing business model.

21

Convocation Notice of the 59th Annual Shareholders’ MeetingConvocation Notice

Officers of the Company
Matters concerning the Company’s officers
Directors and corporate auditors (as of December 31, 2021)

Director

Responsibilities and important concurrent posts

Term of officeP1

Tetsuya Nakayama Overall business of the Company

Kazuo Nakai

At the close of the 59th
Annual Shareholders’ Meeting

Head of Sales Division
Executive in charge of TRUSCO NAKAYAMACORPORATION (THAILAND) LIMITED
Executive in charge of PT. TRUSCO NAKAYAMAINDONESIAAt the close of the 59th
Annual Shareholders’ Meeting

Business Report

Representative
Director andPresident

Name

P9

Director

Atsushi Kazumi

Head of Corporate Management Division,
Head of Digital Strategy Division

At the close of the 59th
Annual Shareholders’ Meeting

Director

Hideki Naoyoshi

Head of Distribution Division

At the close of the 59th
Annual Shareholders’ Meeting

Reference Data

Position

P33

Kenichi Saito

Representative Director, ForeSight & Company
Representative Director, the Society for
Problem-Solving Proficiency

At the close of the 59th
Annual Shareholders’ Meeting

Outside Director

Kuniaki Hagihara

Representative Director and Chairman,
Hagihara Industries Inc.
Chairman, Toyo Heisei Polymer Co., Ltd.
Outside Director, Wavelock Holdings Co., Ltd.

At the close of the 59th
Annual Shareholders’ Meeting

Outside Director

Takako Suzuki

Chairperson of the Board and President &Chief Operating Officer, S.T. Corporation
Director, Chardin Co., Ltd.

At the close of the 59th
Annual Shareholders’ Meeting

Full-time
Corporate Auditor

Masaki Matsuda

At the close of the 60th
Annual Shareholders’ Meeting

Full-time
Corporate Auditor

Akira Takada

At the close of the 59th
Annual Shareholders’ Meeting

Outside Director

Part-time
Corporate Auditor

Hiroho Kamakura

Part-time Corporate Auditor,
Yushin Precision Equipment Co., Ltd.
Part-time Corporate Auditor,
Fujio Food System Co., Ltd.
Part-time Corporate Auditor, SymEnergy Inc.

At the close of the 61st
Annual Shareholders’ Meeting

Notes:
1. Pursuant to Article 19 of the Articles of Incorporation of the Company, the term of office of a director is one year.
2. Outside Director Kuniaki Hagihara has taken office as the Director and Chairman of Hagihara Industries Inc. in January 2022.
3. Director Shinsaku Miyata resigned on March 4, 2021.
4. Full-time Corporate Auditor Tadahisa Yabuno resigned on September 30, 2021.
The following items of business report are not included herein, but are posted on the Company’s Internet website (http://www.trusco.co.jp/)(IR Information → IR Library → Shareholder Communcation) pursuant to the provisions of applicable laws and regulations and Article 15 of the Articles
of Incorporation of the Company.
[Current Status of the Company (major lenders)]; [Officers of the Company (main activities of outside officers during the current fiscal year, mattersconcerning independence, and special notes concerning outside officers)]; [Accounting Auditor]; and [Systems and Policies of the Company (systems
to ensure the appropriateness of business operations and their operation status, basic policy on the control of the Company, and dividend policy)]

Convocation Notice of the 59th Annual Shareholders’ Meeting

Internetdisclosure

22

Convocation Notice

Current Status andPolicies of the Company

Business Report

P1

Dividend of surplus and dividend calculation standard
The Company carries out business activities and capital investment forthe purpose of being of service to the manufacturing industry in Japanto achieve sustainable growth and thereby intends to maximize thereturn to its shareholders. As for the distribution of profit, the Company’s
basic dividend policy is to pay performance-linked dividend at aconsolidated payout ratio of 25% based on net income attributable toowners of parent, provided that the Company’s profit has exceeded acertain threshold subject to a lower limit to secure stable dividend.

Dividend calculation standard
Net income per share

Annual (interim) dividend per share

Above 40 (20) yen

Net income per share × 25％

Below 40 (20) yen

10 (5) yen

Treatment of the impact of special factors,
such as the sale of real estate or shares
In a fiscal year in which net income attributable to owners of parent has
fluctuated significantly due to the sale of real estate or shares not directly
related to business activities or other special factors, their impact is
excluded in the determination of dividend amount.

Employees
Number of employees (Unit: Number of employees/age/number of years)
2020
2021
Number of
Number of(Note)
1
employees
employees(Note) 1

Female employees
Male employees
Part-time employees
Officers
Total and average

589
1,085
1,100
12
2,786

Average Average
years
age
of service(Note) 2

Yoychange(Note) 2

571
1,061
1,264
10
2,906

32.8
43.2
52.2
61.7
45.2

-18
-24
+164
-2
+120

Assets and their location（

Gain on transfer

Land: 4,682.32 sm (1,417 tsubo)
Location: 4-59-1 and 4-59-2 Shiginonishi, Joto-ku,
Osaka City, Osaka

Approximately
2.4 billion yen

Land: 570.18 sm (172.47 tsubo)
Location: 1-20-1 Shinmachi, Nishi-ku, Osaka City, Osaka

Approximately
0.9 billion yen

In the fiscal year ended March 31, 2012, the Company recognized a loss onretirement of non-current assets of 590 million yen in relation to the existing buildingson the site for the construction of a new Nagoya Branch, but paid a special dividendof 4.50 yen per share on top of regular dividend.

）

Annual dividend per share and net income per share

Notes: 1. The figures in parentheses ( ) indicate the calculation standard for the first twoquarters of the year
2. For the purpose of this calculation, any fraction less than 1 yen will be rounded
up in increments of 0.50 yen (0.01 - 0.49 yen will be rounded up to 0.50 yen
and 0.51 - 0.99 yen to 1.00 yen).

Category

Extraordinary income or loss arising from the following transfers of non-current
assets is excluded from the net income attributable to owners of parent used todetermine the distribution of profit for the fiscal year ended December 2021.

●●

Reference Data

P9

P33

Extraordinary income or loss excluded in thefiscal year ended December 31, 2021

Dividend policy

9.1
18.2
6.0
16.0
11.1

Notes: 1. The number of employees in the table above includes seconded employees
and local employees of subsidiaries.
2. Average age and average years of service represent the average of full-time employees.

Net income per share(Unit: yen)

Annual dividend per share

175.97

Transition to consolidated financial reporting (Note) 1

147.44145.78

37.00

36.50

30.50

2018

2019

2020

151.04(Note) 2

121.43

Net income
per share

35.50

38.00
Annual dividend

2021
2022
per share
Current year
Plan
Notes: 1. The Company started to prepare consolidated financial statements from thefiscal year ended December 2019 onwards. Therefore, from the fiscal year
ended December 2019 onwards, annual dividend per share and net income
per share are calculated based on net income attributable to owners of parent.
2. Although net income per share is 175.97 yen, annual dividend per share is
calculated based on a deemed net income per share of 140.02 yen, whichis calculated after excluding extraordinary income or loss.

Number of employees with disability
Number of employees withdisability
Required number of employees withdisability based on mandatory
proportion of disabled workers (Note) 2
Proportion of employees withdisability (Note) 1
Mandatory proportion of
disabled workers

2017

2018

2019

2020

2021

67

67

66

66

67

43

48

51

50

55

3.1

2.9

2.9

2.9

2.8

2.0

2.2

2.2

2.2

2.3

Notes: 1. Proportion of employees with disability is calculated as a percentage of total
number of full-time employees.
2. The number of employees with disability necessary for the compliance withthe mandatory proportion of disabled workers is calculated on a trial basis.

Shares of the Company
Status of shares

Top 10 largest shareholders(1) Total number of authorized shares 110,000,000(2) Total number of issued shares
66,008,744 (including 66,107 treasury shares)
65,942,637 (excluding 66,107 treasury shares)(3) Number of shares per unit of the Company’s stock 100(4) Number of shareholders
14,406 (down 1,930 from the end of the previous
fiscal year)

Number of shareholders holding voting rights
13,527 (down 1,987 from the end of the previous
fiscal year)

Number of shares: 66,008,744

0.10%
66,107（1
No changeyoy

Domestic
companies

34.48%
22,757,978

）（

533
down
20 yoyFinancial institutions
and securities
companies

Individuals
and others

26.31%
17,368,599

19.47%
12,852,467

19.64%
12,963,593

61

13,608

203

） （

down
4 yoy

）（

down
1,908 yoy

Foreigncompanies

）（

Up
2 yoy

）

Number of shareholders: 14,406

23

Number of
Shareholding
shares held
ratio
(thousand shares)(%)

1 NS Holdings Corporation

7,918

12.01

2 The Master Trust Bank of Japan, Ltd.

7,480

11.34

3 Custody Bank of Japan, Ltd. (Trust Account) 5,448

8.26
6.60
5.23
3.58
2.81
2.38
2.35
2.04

(Trust Account)

4,350
3,450
6 NR Holdings Corporation
2,358
7 Government of Norway
1,854
8 Custody Bank of Japan, Ltd. (Trust Account 9) 1,571
9 Tsutomu Otsu
1,547
10 Hiroyuki Otsu
1,346
4 The Nakayama Visual Welfare Foundation

Share composition by shareholder and shareholder distribution
TreasurysharesName

Convocation Notice of the 59th Annual Shareholders’ Meeting

5 Daido Shoji Co., Ltd.

Note: Shareholding ratio is the ratio of shares held to the total number of issued
shares (excluding 66,107 treasury shares) outstanding as of the last day ofthe current fiscal year.

Method of determining officers' remunerationand its composition

At its meeting held on October 14, 2021, the Board of Directors of theCompany passed a resolution to establish a policy for determining the
remuneration of individual officers. As the Board of Directors also
confirmed that the method of determining remuneration and the
remuneration determined for each individual officer for the current
fiscal year are consistent with the determination policy, the Company
has determined that they comply with the determination policy.
The Company determines the officers' remuneration paid to directors
and corporate auditors based on the following policy:(1) The level of remuneration should be such that the Company is able toretain the motivation to improve business performance and to secure
excellent human resources from within and outside the Company.
(2) The level should be based on changes in the business environment,
objective external data, etc., and should take into account thebalance between public standards, management content, andemployee salaries.
(3) Officers’ remuneration should be paid within the annual
remuneration limit, including their bonuses.

Officers’ remuneration consists of fixed remuneration (monthly fixed remuneration)and officers’ bonuses. The following remuneration ranges, designed to take into
account the responsibilities of each position and the degree of influence on management, have been established, and each component of remuneration will be determined by the Board of Directors after taking into account the management environment, business performance, achievements, management capabilities, thedegree of contribution, etc.
The determination of the specific amount of remuneration for each officer may beleft to the discretion of the President by resolution of the Board of Directors. The authority delegated to him is to determine the specific amount of remuneration foreach officer after taking into account the business performance, achievements,
management capabilities, the degree of contribution, etc., within the range designed for each position to take into consideration the right of representation, theresponsibilities of each position, and the degree of influence on management. The
reason for delegating these authorities is that he is the Representative Director andPresident of the Company who oversees the overall business execution of theCompany and therefore is the most suitable person to evaluate each director, while
taking into consideration the financial performance of the whole Company from ahigh level perspective.
(1) Fixed remuneration
The amount of remuneration is determined at the beginning of each fiscal year
after taking into account the business performance, achievements, management capabilities, the degree of contribution, etc., within the range designed
for each position to take into consideration the right of representation, the responsibilities of each position, and the degree of influence on management.

Remuneration System for Directors and Corporate Auditors(2) Officers’ bonuses

Fixed remuneration
Monthly fixed remuneration
Paid in accordance with each officer’s position, individual
performance evaluation, etc.

Bonuses of directors and corporate auditors
Paid in accordance with performance up to 3% of net income
attributable to owners of parent provided that it is positive forthe fiscal year.

Officers’ bonuses are determined as an incentive linked to profit indicators similar
to the basic policy for shareholder returns. More specifically, the total amount is determined at the end of each fiscal year by the Board of Directors subject the upper
limit of 3% of net income attributable to owners of parent after calculating reference amounts by multiplying net income attributable to owners of parent by bonus
multipliers (cumulative) for each position as specified in bylaws. Officers’ bonuses
are paid annually within six months from the end of the relevant fiscal year.
The amount to be paid to individual officers is determined for each officer within
the remuneration range, taking into consideration, among others, the degree ofcontribution to the business results for the relevant fiscal year.
* The same remuneration system as for directors is adopted also for corporate
auditors and outside directors based on the recognition that they are also
responsible for the enhancement of the corporate value of the Company and its
consolidated subsidiary. Individual amounts of fixed remuneration and officers'
bonuses to be paid to corporate auditors are proposed by directors to them andfinalized through discussions among corporate auditors.

Upper limits, ranges, and total amounts for the current fiscal year of officers’ remuneration
Position

Upper limits
on officers’
remuneration

President
Senior managing
director
Managing
Within 600 million
director
Directors
yen per year
(Note) 1
Director
Outsidedirector
Full-time
Corporate corporate auditor Within 100 million
yen per year
auditors(Note) 2
Part-time
corporate auditor

Ranges of remuneration

60 million yen to
144 million yen
27 million yen to
39 million yen
21 million yen to
33 million yen
18 million yen to
27 million yen

2. Officers’
bonuses0 yen to80 million yen
0 yen to24 million yen
0 yen to20 million yen
0 yen to14 million yen

60 million yen to
224 million yen
27 million yen to
63 million yen
21 million yen to
53 million yen
18 million yen to
41 million yen

4 million yen to
9 million yen

0 yen to1 million yen

4 million yen to
10 million yen

15 million yen to
27 million yen

0 yen to9 million yen

15 million yen to
36 million yen

4 million yen to
9 million yen

0 yen to1 million yen

4 million yen to
10 million yen

1. Fixed remuneration(1+2)

Total amounts of remuneration of directors andcorporate auditors for the current fiscal year

Directors: 9328 million yen
in total

Outside directors:
6309 million yen
in total（

Outside directors:
3
19 million yen
in total
Corporate auditors: 4(including 3 outside
corporate auditors)
76 million yen in total

Officers: 13
404 million yen
in total
including
6 outside
officers:
81 million yen
in total）

Notes: 1. As per the resolution passed at the 56th Annual Shareholders’ Meeting held on March 8, 2019. The number of directors at the close of the meeting was 9 (including 2
outside directors).
2. As per the resolution passed at the 58th Annual Shareholders’ Meeting held on March 18, 2021. The number of corporate auditors at the close of the meeting was 4(including 3 outside corporate auditors).
3. The officers’ retirement benefit program was transitioned to financial bonds in 2004. An amount equivalent to 10% of officers’ bonuses is paid in monthly installments.
4. The total amount of officers’ remuneration for the current fiscal year is equivalent to 1% of net income attributable to owners of parent.
5. The table above includes a director who resigned on March 4, 2021, a managing director who resigned at the close of the 58th Annual Shareholders’ Meeting held on
March 18, 2021, and a corporate auditor who resigned on September 30, 2021.

Matters concerning directors’ and officers’ liability insurance agreement
The Company has concluded with an insurance company, and bears the full premiums of, a Directors’ and Officers’ Liability Insurance Agreement covering as insured persons the
directors, corporate auditors, and executive officers of the Company and its consolidated subsidiaries. This insurance compensates for any litigation costs and damages arising from
non-derivative actions, shareholder derivative actions, and corporate actions that are borne by the insured persons in executing their duties, provided that they have executed their duties
in good faith or without violating laws and regulations. (However, measures are taken to ensure that the appropriateness of the execution of duties by the insured persons will not be
undermined by excluding from the coverage any damage, etc. to those insured persons who have engaged in any criminal offence or intentional act of violating laws and regulations.)
Convocation Notice of the 59th Annual Shareholders’ Meeting

24

P1

Business Report

Policy for determining the remuneration of
directors and corporate auditors

P9
Reference Data

Amount of remuneration of directors and corporate auditors

Convocation Notice

Officers of the Company

P33

To continually serve Japanese manufacturing
in every era

ESG
Activity
ReportBasic Policy on Sustainability ~TSV (TRUSCO Shared Value)~
The Company aspires to be a pro tool supplier continually serving Japanese manufacturing
in every era. Under the motto, “Business must serve people and society,” the Company will
create both social value and corporate value through its businesses to help resolve social
issues and build sustainable local communities.
* The term TRUSCO Shared Value (TSV) was created by combining TRUSCO and Creating
Shared Value (CSV).

Material issues
To be a sustainable company with a lower environmental load
On the basis of its basic TSV policy, the Company identified the material issues it faces for sustainability. We will work on these material issues
through our business activities toward the establishment of a sustainable society.

1 Total optimization of
the supply chain

2 Planning and development of productsthat respond to diversifying needs

3 Development of environments andpersonnel to enable them to fully
display their personal abilities

Become a platform operator supporting manufacturing and optimize the supply chain to establish sustainable pro tool distribution that is bothhuman-friendly and environmentally friendly.

Develop and provide private brand (PB) products with original value to suit diversifying
needs and trends in the manufacturing sector
to help rationalize manufacturing operations
and increase productivity and competitiveness.

Provide an environment that ensures that personnel are highly motivated and that enables
them to display their abilities to the fullest degree
to consequently ensure corporate growth.

4 Environment actions throughbusiness activities

5 Contribution to stakeholders andlocal communities

6 Governance based on a stanceof choosing the proper actions

Work to reduce the environmental load of theCompany's business activities and PB products
as well as that of the users of the Company's
products to help the Japanese manufacturingindustry with its environmental activities.

Cherish the relationships with stakeholders
through support for people with disabilities andcommunication with local communities andsociety through sponsorships and advertising.

Improve the fairness and transparency of management and implement swift and appropriate
decision-making to conduct business activities
that conform to laws and social norms.

Environment

Environment

Environmental activities through business

The Company is working to reduce environmental load in business activities, planning and developing environmentallyfriendly PB, and actively conducing recycling, reuse, and the use of returnable containers. TRUSCO aims to provide
sustainable distribution by working to reduce the environmental load of the entire supply chain through the efforts to reduce
not only its environmental load, but also that of the users of its products. These efforts are internally referred to as TRUSCO
Shared Value (TSV) activities, and the Company strives to raise the awareness of and instill TSV into each employee.

Efforts to reduce environmental load throughout the supply chain
Old

1 Purchase products

New・Environmentally friendly TRUSCO
products
・Reduction and standardization ofcontainers and packing
・Inclusion of environmental information in
catalogues
TRUSCO keyless drill chuck

3 Deliver products
・Reducing environmental load by
fixed-cost based distribution
・Reducing environmental load bydirect shipments to users
Folding containers and return cushions*
are used for the delivery to customers. It
is only routing delivery that can deliverproducts without using packing
materials.
* TRUSCO return cushions
TRC-20L/50L (available in three colors)

Product number: TKC-170 and others
We changed the packing material from blister pack to paper case, which
does not use plastics. As a result, we were able to cut CO2 emissions related
to the manufacture of packages and these related to package disposal by
5% and 50%, respectively.

Suppliers(2,966 companies)

1

2

3

3

2 Reducing environmental load with
the Company’ s own facilities

・TRUSCO Power Generation
Installations [19 locations]・Introduction of environmentally friendly
vehicles [46 vehicles]
BEVs: 7
Solar power generation panels on
PHEVs: 2
the rooftop of Planet Saitama
HVs: 37 (including 9 trucks)(As of December 31, 2021)

25

Clients (5,527 companies)

Convocation Notice of the 59th Annual Shareholders’ Meeting

4

Users

(Infinite ∞)4 Use products
・“MRO Stocker,” a system of “use first, pay
later” that has been around for many years inJapan for medicine, but for tools[329 locations nationwide]
We collect and recycle used PB pallets(As of December 31, 2021)
in collaboration with Gifu Plastic
Industry Co., Ltd. Unnecessary pallets
・“Naojiro” repair workshop service
are collected, crushed, and used asmaterials for recycled pallets. The
collection is free of charge.

* The Task Force on Climate-related Financial Disclosures (TCFD) is an international framework for encouraging disclosures of climate-related risks and opportunities andthe impact of climate change on financial performance. It published recommendations to companies for the disclosure of climate-related information in 2017.

Governance
The Company has established a Sustainability Committee as a body to oversee the Company’s basic policy on sustainability and efforts toaddress material issues. The Committee, assisted by the Corporate Planning Department and the Sustainability Promotion Section acting as its
secretariat, supervises the activities to promote sustainability initiatives of the whole Company including the management of climate-related risks.
Any agenda resolved by the Committee is reported each time to the Board of Directors (Management Conference). In addition, subcommittees
will be established under the Sustainability Committee to deliberate on individual specific matters concerning each risk and initiative.

Strategy
We analyzed the impact of climate change on the Company’s business by examining future changes in the external environment based on theframework proposed by the TCFD. We are addressing the following main risks and opportunities as part of business activities.
Risks

Description

Transition risks

Policy andregulatory risk
Technology risk
Market risk
Reputational risk

Impact on the Company∙ Purchase and maintenance of electric vehicles as a result of the shift from gasoline-fueled vehicles to electric vehicles in
response to greenhouse gas emission regulations
Increase in expenses∙ Rise in raw material purchase prices for PB products manufactured by the Company as a result of the introduction ofplastic regulations and carbon taxes∙ Increase in capital expenditure for new product development and further energy saving and efficiency improvement at
Increase in expenses
distribution centers to achieve carbon-free operations∙ Decline in market reputation due to the perceived lack of environmental initiatives

Decrease in sales∙D ecrease in the amount of orders received due to an insufficient selection of products to address sustainability issues∙ Decrease in the number of orders received for paper-based catalogues and resulting decreases in the amount of orders
received for products in reference to paper-based catalogues

Decrease in sales

Physicalrisk

Decrease in sales andincrease in expenses

Acute risk

∙ Direct damage of a disaster to the Company, domestic and overseas supply chains, and inventories

Chronic risk

∙ Deterioration of the working conditions in distribution centers and health damage to employees caused by rising
Increase in expenses
temperature

Opportunities

Description

Impact on the Company

Efficiency of
resources

Opportunities∙ Decrease in expenditure with efficient delivery by strengthening direct shipments to users and reducing packing materials Increase in sales andby half
decrease in expenses
Decrease inSource of energy ∙ Reduction in financial cost by increasing the in-house solar power generation and consumption
expenses∙ Increase in the use of MRO Stocker and direct shipments to users, which contribute to the efficiency improvement of theentire supply chain
Products andIncrease in sales
services∙ Increase in the use of repair business, “Naojiro” repair workshop service, and in the demand for environmentally friendly
products.
MarketResilience∙ Increase in sales due to an increase in product demand in the industrial robot market and EV-related markets

Increase in sales∙ Increase in demand as a result of risk diversification through the existence of many distribution centers and theestablishment of fastest, shortest, and best delivery routes

Increase in sales

Risk management
The Sustainability Committee is responsible for the management of all risks across the Company. Among these risks, the Committee
recognizes climate change risk as one of the key risks. Climate change risk is deliberated by subcommittees at least four times a year to
identify and evaluate risks and opportunities and develop response measures by discussing the progress status of measures to address
issues and any new risks. Deliberation results of subcommittees are reported to the meeting of the Sustainability Committee, which is held
twice a year, and particularly important matters are reported to the Board of Directors (Management Conference). Separately from this,environmental metrics and issues are reported by the Sustainability Promotion Section to the Board of Directors (Management Conference)
on a monthly basis as a general rule.

Metrics and targets
The Company has been disclosing carbon dioxide emissions (Scope 1* and Scope 2*) and solar power generation capacity as environmental metrics
since January 2022. In addition, as its unique efforts to reduce the environmental load of the entire supply chain, the Company uses the number ofdelivery runs of direct shipments to users and the number of companies that have introduced MRO Stocker as metrics of the reduction of environmentalload and has set specific targets for them based on the recognition that they are highly efficient delivery services and use less packing materials.
Progress and plan on key performance indicators of the Company▶

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・Disclosure of Scope 3*
The Company has worked on the overall optimization of supply chain by strengthening user-direct shipment service and promoting MRO
Stocker and thereby has promoted the reduction of greenhouse gas emissions from the supply chain. The Company is currently analyzing
its Scope 3 emissions including the effect of such efforts and will prepare for their disclosure in a phased manner.
Changes in carbon dioxide emissions (Scope 1, Scope 2) and net sales

5,623
3,812

1,665

5,918
1,770

7,296
1,950

Carbon dioxide emissions (t-CO2)
9,095
8,008
7,871
7,427
2,142

2,206

2,134

2,293

1,144

2014

Net sales(100 million
yen)

2015

2016

2017

2018

2019

2020

2021

Changes in power output and self-sufficiency rate of the Company
255
Self-sufficiency rate
(%)
Power
9.6
generation
output(10,000 kWh)

10 1.3

72

2014

2015

183
10.4
85
2016

10.7
99
2017

139

18.9

260

16.5

14.1

11.3

2018

2019

2020

2021

* Scope 1: Direct emissions due to the use of fuels; Scope 2: Indirect emissions due to theenergy supply from other companies; Scope 3: Indirect emissions due to the portion of
supply chain other than Scope 1 and Scope 2

Convocation Notice of the 59th Annual Shareholders’ Meeting

26

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Business Report

To continue to be of service to people and society in any era, the Company works to resolve social issues and conducts
activities to contribute to local communities in accordance with its basic policy on sustainability. Based on the TCFD
recommendations*, we disclose our responses to climate change in accordance with the four categories of “governance,”“strategy,” “risk management,” and “metrics and targets” as follows:

Convocation Notice

Responses to climate change risks and opportunities Environment

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Reference Data

Environment

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Comfortable work environment

Based on the idea that “an employer has the obligation to provide a work environment where employees can continue to work for along time with a peace of mind,” the Company provides an environment that supports female employees and encourages all
employees to use various workplace-related programs of the Company.

Fiscal year ended
December 2020

Fiscal year ended
December 2021

P1

Percentage of female
employees to all employees
hired during the year

56.8% (Employees)

51.0% (Employees)

Percentage of female
employees to all
employees

35.2% (Employees)
75.3% (Part-time employees)

35.0% (Employees)
73.5% (Part-time employees)

Percentage of female senior
supervisors to all employees holding
the senior supervisor position

22.7%（58）

18.5%（62）Percentage of female
managers to all employees
in management roles

5.0%（7）

6.9%（9）Percentage of annual
paid leave taken

67.6% (Employees)

65.4% (Employees)

Percentage of employees
returning to work after
taking childcare leave

92.1%（35）

96.0%（43）

Number of male
employees who havetaken childcare leave

8

11

Business Report

Convocation NoticeSociety

Reference Data

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Comfortable work environment indicators

Percentage of employees
who have taken childcare
leave by gender
Average overtime
hours per month

Male 25% (Employees)

Male 26% (Employees)

Female 100% (Employees)

Female 100% (Employees)

hours (including

14.9 predetermined
overtime hours)

As a company that looks after the lives of our employees, we want totake responsibility for the health of our employees and their families.
Based on that desire, in April 2019, we established the Trusco
Nakayama Health Insurance Association, our sole health insurance
association, at the Tokyo Head Office. Its establishment allows us tofurther enhance our own health services. We will promote initiatives
that are suitable for the Company so that employees can continue
working with a peace of mind for many years.

Advantages of the Company’s own health insurance association
Smooth decision making<New coverage>
・Specified fertility treatment cost assistance (up to six time per childsubject to the upper limit of 50,000 yen)・Non-smoking outpatient assistance (subject to the upper limit of 20,000 yen)In addition, HPV and PSA test assistance will be added in April 2022.
The coverage will be expanded or modified as necessary to, forexample, modify the items of health checkup.

hours (including

14.4 predetermined
overtime hours)* The numbers shown above each indicator are those of the parent company
only. The numbers in parentheses ( ) above indicate the number of relevant
employees.

Enhancement of challenge programs
To increase career options and opportunities for employees
and support their carrier development on their own initiative, weenhanced our job challenge programs as part of personnel
system reform.
Boss Challenge ProgramThis program provides employees an opportunity to be promoted to the boss
position, which is the head of the respective area, through their own initiative
to stand as a candidate or the supervisor’s recommendation. Under thisprogram, employees are actually assigned to be assistants to an incumbent
supervisor to aim to become a boss while learning management skills.

Job Challenge ProgramThis program allows employees to be transferred to a department of theirown choice to develop employees who can help TRUSCO grow further
through their own definite motivation and contribution.

Concurrent Job Challenge Program New programThis program allows employees to experience other departments while
continuing to belong to the current department. This program is open to
employees who wish to challenge themselves to experience the work ofother departments even just a little bit, while raising their efficiency andcontinuing to do 100% of the current work.

Open Position Challenge Program New programThis program allows employees to apply for any position of their choice on theirown initiative (without needing the approval of their supervisors) when such a
position is available at a department that intends to increase its workforce.
Standing as a candidate for supervisor under theOpen Position Challenge Program
Momoka Miwa, Section Manager, Overseas Sales
SectionComment
To establish overseas business as one of thepillars of the Company’s business, I will challenge
myself to try new things without being afraid of
failure.

27

Trusco Nakayama Health Insurance Association

Convocation Notice of the 59th Annual Shareholders’ Meeting

Health insurance card(sample)Staff at the Trusco Nakayama Health Insurance Association:Tani, Head of Administration (to the left) and Nakamura, Chief

Paid Leave Accumulation Bank Program
The old Paid Leave Accumulation Program (started in January 2007)
was modified and renamed to Paid Leave Accumulation Bank Program.
This program is open to all employees including part-time
employees and allows them to prepare for a situation in which theymust take a leave for a long period due to illness, nursing, studying
abroad, etc. The new program has eliminated the previous upper
limit of 60 days on the number of accumulated paid leave days. In
other words, unused days of paid leave can be accumulated
without limit. In addition, the program was modified to expand thescope of eligible use to suit the life plan of each individual.
Employees can also sell any unused days of paid leave to theCompany when they leave the Company.
[Cases in which accumulated paid leave can be used](1) Study leave:
To study at a university, technical school, etc., in Japanor abroad(2) Volunteer leave
To support a region affected by a disaster, local
community activities, and so on(3) Support leave:
To support one’s spouse before and after childbirth, tosupport to a sick family member, to accompany a sickfamily member when he or she is hospitalized, and so on(4) Travel leave:
To a go on a long trip before retirement, and so on

Company holidays changed to be the same as
calendar holidays
As company holidays have been changed to be the same as calendar
holidays, employees can take holidays in a manner to suit their individual
needs. For example, employees can take a summer vacation on a schedule
to avoid peak season by combining company holidays with paid leave under
the Paid Leave Accumulation Bank Program. The Company will realize a
flexible workstyle for employees as well as higher convenience for clinets.

Convocation Notice

SocialPersonnel programs (partial list)
Program

Start

Childcare Leave Program (3years)

1992

Birthday Time Off Program

1996

Half-day Full-time Employee
Program

1996

Happy Sunday Program

2002

Financial Bonds (annual
payment of retirement
allowance)

2003

Transfer Request Program

2005

Lovebird Transfer Program

2005

Maternity Bonus Program

2005

Child Support Allowance

2007

Paid Leave Accumulation
Bank Program(1) 2007(2) 2022

Welcome Back Program

2014

Return-to-Work Support for
Employees on Maternity orChildcare Leave

2015

TRUSCO Part-time Programfor Retirement-aged
Employees

2015

TRUSCO New Employees
Preparation Allowance2016

My Home Concierge (housing
consultation service)

2016

Work from Home Program(1) 2017(2) 2020

Return-to-Work Programfor Employees on Childcare
Leave

2019

In-house Side Job Program(Hybrid Work Program)

2019

Go Home Early Program

2020

Short Permitted Absence
Program

2020

Fertility Treatment Leave

2021

Special Rules on Work Area
Change / Course Change

2021

Employee Tabuchi of Akita Branch on aleave under the Childcare Leave Program

Overview
TRUSCO employees can take childcare leave until the end of the month during which the child becomes three years old,
if desired. (Japanese law allows employees of any company to take childcare leave until the day before the child becomes
one year old.) (Program users: 45)
In order to promote the use of paid vacations, we encourage employees to take annual paid vacations on their birthdays (orwithin one month before or after) as “birthday time off.” (Program users: 291)
This system allows employees to reduce their working hours by up to three hours per day for reasons of child raising until
their child finishes sixth grade (legally, by up to two hours per day until a child reaches three years of age). Employees canalso use this system to shorten their working hours when they are pregnant, taking care of a family member, or injured/sick.
(Program users: 97 for childcare, 0 for taking care of a family member, and 9 due to injury/sickness)
This is a program that allows employees on an unaccompanied assignment to delay coming to work on Mondays so thatthey can spend time with their families at dinner on Sundays when they return home on weekends. (Travel expenses for
returning home twice a month and company housing rent are paid separately from this program).
TRUSCO pays retirement allowance annually as “financial bonds,” which are performance-based payments to reward
annual contributions, rather than paying it as a lump sum retirement payment at the time of retirement.
This program allows employees to request a transfer to a desired place of business due to unavoidable circumstancesof them or their family, such as marriage or taking care of a sick family member. (Program users: 68 *during the last three
years)
This program allows employees to transfer, following their spouse’ transfer, to the same area as their spouse and tocontinue to work for the Company regardless of whether their spouse is an employee of the Company. (Program users: 23*during the last three years)
This program allows the period of maternity leave (14 weeks) to be included in the bonus calculation period and bonuses tobe paid accordingly.
The Company provides an allowance of 10,000 yen per month for each child to employees who have children under ten
years old. From 2014 onwards, this allowance is paid also to employees who are on childcare leave.
(1) This program allows employees to accumulate unused days of paid leave to prepare for a situation in which they musttake a leave for a long period due to illness, nursing, studying abroad, etc.
(2) The old Paid Leave Accumulation Program was renamed to Paid Leave Accumulation Bank Program in 2022, and theprevious limit of 60 days on the number of accumulated paid leave days was eliminated. Under the new program, unused
days of paid leave can be accumulated without limit. In addition, the program was modified to expand the scope of eligible
use. Employees can also sell any unused days of paid leave to the Company when they leave the Company.
This program is for the re-employment of employees who had to leave the Company to raise a child, take care of asick family member, undergo infertility treatments, or to accompany their spouse overseas due to his or her overseas
assignment, provided that ten years have not passed since their leaving the Company. (Program registrants: 28; reemployed employees: 4)
One tablet terminal is lent to each employee for information sharing, and information can be exchanged on “Tramama
Port,” a space on the Company’s internet dedicated to employees on maternity or childcare leave. We also provide support
to make it easier for such employees to return to work. For example, an Office Visit Day is arranged for them every fourmonths.
This program allows employees who have reached the age of 70 to continue employment at the Company as part-time
employees until the age of 75 if they wish to do so, provided that they meet certain criteria. (Such employees are called“seniors.” (Program users: 15)
This program provides the money necessary for new employees to smoothly start a career as a working adult. This
allowance is provided to new employees about one month before they start working for the Company (200,000 yen to
employees who live alone and 100,000 yen to employees who still live in their parents’ house after joining the Company).
(Program users: 43 * new employees who joined the Company in 2021)
Two first-class licensed architects, who are employees of the Company, are available for consultations with employees who
have concerns regarding their housing. (Consultations held: 6)(1) Permanent: Employees can telecommute on a permanent basis when it becomes difficult for them to come to the officedue to relocation or integration of offices, transfer of a spouse, injury, illness, taking care of a family member, etc.
(2) Discretionary: With the permission of the head of the office, employees can choose to telecommute up to twice a week.
This program allows employees who have finished their childcare leave to choose the number of working days, working
hours, and whether to work at office or work from home until the child is three years old so that they can return to worksmoothly.
This program allows employees to work in a department that is different from one’s own department on their days off andearn extra income on the side. This program permits only the kind of work that any employee can do. This is a great way for
employees to gain new insights. (Program users: 127)
This program allows employees to go home early even during scheduled working hours in order to instill in them theawareness and habit of finishing work early, subject to the upper limit of leaving up to 30 minutes earlier once a week. (Useof the program: 158 times)
This program allows employees to adjust their start and finish times in exchange for up to one additional hour of rest time (orless than one hour) for very important reasons, such as visiting government offices, making hospital visits, etc. (Use of the
program: 52 times)
Employees can take a leave for up to one year for infertility treatment, but only for specified infertility treatment (in vitro
fertilization and intra-cytoplasmic sperm injection). The limit is reset at each childbirth, and the program can also be usedagain for the second and any subsequent child. Employees can also take such a leave in up to three separate periods
provided that they are within one year from the start date of the first leave period. Social insurance premium during the leave
will be fully borne by the Company including the portion otherwise to be borne by the employee. (Eligibility: Employees who
have been with the Company for at least one year)
If requested by an employee on fertility treatment, there will be no personnel change involving relocation for up to one year
for him or her (he or she will remain within the same work area). Any employee who has changed his or her career course to
area course for the reasons of infertility treatment will be exempted from personnel evaluation requirements when he or she
wishes to return to the previous course.

Notes: 1. In addition to the programs listed above, the Company offers a staggered workday system, a free biz system, and a no-necktie system (a program that allows employees not
to wear neckties outside the cool biz period).
2. The number of program users for each program represents the number of employees who used the program in 2021 (excluding part-time employees).

Convocation Notice of the 59th Annual Shareholders’ Meeting

28

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Business Report

For such a program, when it started is an important factor as it reflects differences in ambitions of eachcompany even if they offer the same program. TRUSCO has a number of unique personnel programs
developed out of caring for employees, rather than the current trend in the world. The Company raises the
motivation of employees by respecting their opinions and supporting their workstyle through various
approaches to help the Company achieve growth.

P9Reference Data

Major programs to help employees to continue to work for many years with a peace of mind

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Convocation Notice

SocialBusiness Report

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Reference Data

P9

P33

The Nakayama Visual Welfare Foundation“Giving Back to Society” through the Nakayama Visual Welfare Foundation
The Nakayama Visual Welfare Foundation was established in 1997 in response to
the will of “wanting to serve visually impaired people” by Kiyoko Nakayama, themother of Tetsuya Nakayama (President of the foundation), who was born with
optic nerves damaged by a forceps delivery. It later became a public interest
incorporated foundation in 2010. The basic property of the Foundation consists ofshares of TRUSCO NAKAYAMA Corporation, and the Foundation does not receive
donations or support from outside and is operated independently. We continue“Giving Back to Society” through the Nakayama Visual Welfare Foundation.
“Tenero” and “Sumo,” guide dogs available for loan
(FY2021)

The operation of the Foundation is funded by stock dividends
The Foundation was established by the Chief Director’s Nakayama Family with acontribution of four million shares of TRUSCO NAKAYAMA Corporation stock and
500 million yen in cash. In 2021, the Nakayama Family made an additional
contribution of 1 million shares. The Foundation’s business operations are fundedby stock dividends.
Number of the Company’s shares held: 4.35 million shares(As of December 31, 2021)

Overview

October 1, 1997
November 1, 2010
Transformed into a public interest incorporated foundation
October 1, 2021
Renamed from “The Nakayama Visually Impaired Welfare
Foundation” to “The Nakayama Visual Welfare Foundation”
Chief Director Tetsuya Nakayama
Address
2-1-9 Mizuki-dori, Hyogo-ku, Kobe, Hyogo Prefecture(3 minute walk from Shinkaichi Station)
TEL: 078-599-6140 / FAX: 078-599-6141
Support project results
816.29 million yen (cumulative total through FY2020)
Established

New Nakayama Memorial Hall (Completed on September
15, 2021)

Site area: 424 tsubo
Total floor area: 1,728 tsubo
Building structure: 1 underground level, 5
floors above ground, equipped with a seismic
isolation system

List of Officers and Councilors (listed in the order of the Japanese syllabary without honorifics)
Chief Director
Tetsuya Nakayama
Senior Director
Saori Nakayama

Managing Director
Atsushi Matsumae
Directors
Takuji Iuchi
Tatsuya Otsuka
Kohei Goto
Teruo Hashimoto
Kenji Furuhashi
Masahiko Mori
Naoyuki Yamamoto
Auditors
Kohei Nomura
Yoritomo Wada

29

Representative Director and President,
TRUSCO NAKAYAMA Corporation
Representative Director, NR Holdings
Corporation
Certified Public Accountant
Executive Director
President, AS ONE Corporation
Chairman, Earth Corporation
Chairman, SANKO Co., Ltd.
Chairman, Nippon Lighthouse Welfare
Center for The Blind
President and CEO, Hosiden
Corporation
President, DMG MORI Co., Ltd.
CEO & President, Yamamoto Kogaku
Co., Ltd.
Attorney, Nomura & Partners
Certified Public Accountant, Wada &Co.

Convocation Notice of the 59th Annual Shareholders’ Meeting

Councillors
Yusuke Saraya
Tomihiro Takamatsu
Yuko Nakayama
Rie Nakayama
Motonobu
Nishimura
Yuki Nomura
Junji Hada
Naotaro Hikita
Kunio Yamada
Yoshiaki Yamamoto
Teiji Wakita

President and Representative Director,
Saraya Co., Ltd.
Ex-chairman, DyDo Group Holdings Inc.
Representative Director, NS Holdings
Corporation
Chief Physician, Ear, Nose, and Throat
Department, Kawasaki Municipal Hospital
Representative Director and Chairman,
Mandom Corporation
President and Representative Director,
TSP TAIYO Inc.
Representative Director and Chairman,
ELECOM Co., Ltd.
President and Representative Director,
Kohnan Shoji Co., Ltd.
Chairman, Rohto Pharmaceutical Co.,Ltd.
Corporate Auditor, OM Kobe Co., Ltd.
President and Representative Director,
WAKITA Corporation

Mr. Senichi Hoshino, who passed away on January 4, 2018,
also served as director from June 2017 to January 2018, andcontributed to the development of the Foundation.

Public interest project 1

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Business Report

Nakayama Memorial Hall facilities leasing business
The Nakayama Memorial Hall facilities have been leased to six nonprofit organizations, which work in coordination with each other in
conducting various activities, including consultations, walking training, creating Braille translations, and holding events. For example,
they provide 4,040 consultations per year. We have completed the construction of the New Nakayama Memorial Hall in September
2021 to bolster our activities to help the visually impaired and the deafblind participate in social activities more actively. The New
Nakayama Memorial Hall facilities are currently leased to 11 nonprofit organizations for their activities.

Convocation Notice

SocialSolar power generation with a capacityof 19kW

Sunny balcony

Public interest project 2

Low vision floor
Convenient aids are available here for
persons with blindness or low vision

Grant project for support groups for visually impaired people and individuals
The Foundation provides grants to groups for visually impaired people and support groups in financial difficulty, to enable them toenhance their activities and provides scholarships free of charge to university students and others. From FY2022 onwards, such
scholarships are granted also to graduate students (in the master’s course).

Public interest project 3
Activities to support visually impaired people for their social participation activities
Aiming to popularize the philosophy of “normalization” that aims to realize a society in which people with disabilities spend every day
like, and participate in activities energetically together with, people without disabilities, the Foundation supports the participation ofvisually impaired people in society.

1 Hyogo Prefecture Visually

Impaired People Music Festival
Project“Nakayama/KLC Concert”
A classical concert started for the
purpose of providing many visually impaired people with opportunities toperform.
(Kobe Light Center (KLC))

4 Music performance project “Nakayama Wonderful Festa”

This is a concert that visually impaired people can attend withwheelchairs and guide dogs which allows them to enjoy theconcert free from worry. Some of our prospective employees
have participated in this event. Through the actual event, weoffer an opportunity for them to learn that TRUSCO not only
pursues profit, but also uses part of profit for social contribution.
Former scholarship student
Kaori Tsutsui performing in aconcert2 Guide dog lending project
We commission the training of two
guide dogs per year and lend them tothe visually impaired as “Nakayama
Go” guide dogs. We have loaned 43
dogs in total through FY2021.

Past performers (names listed without honorifics)
16th 2013 Mariko Takahashi
17th 2014 Sayuri Ishikawa
18th 2015 Yoshimi Tendo
19th 2016 Masahiko Takeuchi,
Kaientai
20th 2017 Masashi Sada

21st 2018 Aki Yashiro
22nd 2019 Tomomi Nishimoto &IlluminArt Philharmonic
Orchestra, Yoshiko Sakuma(narration)

20th Nakayama Wonderful Festa(Masashi Sada, performer)

Prospective TRUSCO employees
attending to visitors* Note: The concert was not held in2020 and 2021 due to the Covid-19
pandemic.

Guide dog lending ceremony
held during the 22nd
Nakayama Wonderful Festa

3 Personal computer course

project
We offer beginner, Internet, office, iPadexperience, and voice PC experience
courses to teach basic computer
usage and Internet operation.

5 Caregiver development training project
The Foundation holds six training workshops per year for the
purpose of increasing the number caregivers and improving
their quality.
Personal computer course

6 Barrier-free film screening project: “Nakayama UD Film
Festival”
A film festival sponsored by The Nakayama Visual Welfare
Foundation for film screening with audio explanations of the scenes
on the screen and Japanese subtitles (UD: universal design).
Convocation Notice of the 59th Annual Shareholders’ Meeting

30

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Open entrance

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Governance system
Corporate philosophy

Our mission is to contribute to society
through corporate activities and to realize
the happiness of the people with whom
we are connected.

Idea▶

The Company’s name and corporate logo
directly express the concept of “TRUSTCOMPANY,” a company trusted by all stakeholders. We have made this concept thestarting point of our daily corporate activities
and aspire to fulfill our social mission byembodying the concept.

Existencephilosophy

Management that keeps on walking
ahead boldly and steadily■ Management that respects people■ Management that fosters
entrepreneurship■ Management that responds to themarket in a trustworthy manner■

Vision▶

Management
philosophy

Value sincerely and courtesy
Generate ingenious ideas and plan
meticulously■ Act dynamically with conviction■ Build trustworthy communication withfriendliness■■

Behavioral
philosophy

Behavior▶

A company that earns trust

People with whom we are connected (stakeholders)MarketP9

Meaning employees and their families, suppliers,
clients, shareholders, and all other people related to
the Company

Reference Data

Society

P33

Governance System Chart (As of December 31, 2021)
General Meeting of Shareholders

Study tours for shareholders

Features of the General Meeting of
Shareholders

Top-Level Parties Conference(Board Meeting)(1) The OJS on the President is conducted.
(2) Meetings are held on an early schedule, avoidingdays on which general meetings are concentrated.
(3) Meetings are held at a physical venue, but online
voting and live streaming are also available.
(4) In addition to the audio presentation, subtitles areprojected onto a screen in real time.
(5) Voting results at the meetings, an excerpt from the
Q&A session, and the results of questionnaires areposted on the website of the Company within
three days.

(1) Attend also by officers to engage in dialog
with shareholders(2) Held at Tokyo Head Office and at distribution
centers

Composition Meets once a month

Tours were not held in the 58th period due to the
Covid-19 pandemic.

1
3
2
1
1

Representative director
Executive directors
Full-time corporate auditors (Note 1)
Part-time corporate auditor (Note 1)
Senior executive officer

Board of Corporate
AuditorsComposition

8 members in total

Meets oncea monthFull-time corporate auditors (Note 1) 2
Meets once a month

Board of Directors

Management Conference

Composition

Composition

1
Executive directors
3Outside directors
3
Full-time corporate auditors (Note 1) 2
Part-time corporate auditor (Note 1) 1

Board of Directors members 10

Representative director

Suppliers
Direct contact(hotline) fromsuppliers

Part-time corporate auditor (Note 1) 1

Board of Directors(Management Conference)

Executive Officers
Genera Managers

Audit

2
13

Reporting

Coordination

Accounting Auditor

Reporting

Deloitte Touche Tohmatsu LLC

Externally Operated
Reporting Hotline

25 members in total

Coordination

Business Report

P1

For the embodiment of“TRUST COMPANY”

Reporting

Convocation Notice

Corporate Governance

Legal Advisors

10 members in total

Execution of Duties

Direct contact (hotline)from employees(including those ofoverseas subsidiaries)

Sustainability Committee (Note 2)
Sustainability Promotion Section (Note 3)
Compliance Officer

Reporting

Representative Director
and President

Tetsuya Nakayama

ReportingInternal Auditing Office
Audits conducted through the“Fire Lookout Tower,” anelectronic auditing system

Direct contact (hotline)from employees(including those ofoverseas subsidiaries)

Audit/guidance

Cross-departmental personnel transfers(1) Transfer of personnel, including manager positions, generally every 5 years on average, (2) Fostering multifaceted employee development and creating a
corporate culture free of factions, and (3) Preventing fraud through new surveillance

Corporate Management
Division

Digital Strategy
Division

Product Division

Sales Division

Distribution Division

Director
Head of Corporate
Management Division

Director
Head of Digital
Strategy Division

Senior Executive Officer
Head of Product Division

Director
Head of Sales Division

Director
Head of Distribution Division

Atsushi Kazumi

Atsushi Kazumi

Tatsuya Nakayama

Kazuo Nakai

Hideki Naoyoshi

Notes: 1. Full-time corporate auditors and part-time corporate auditors are outside corporate auditors.
2. Renamed from Compliance Committee on January 1, 2022.
3. Renamed from CSR Section on January 1, 2022.

31

Convocation Notice of the 59th Annual Shareholders’ Meeting

This Conference consists of officers (excluding outside directors). It
discusses and shares the directions of the Company, while ensuring objective and rational judgment, following which a meeting of
the Board of Directors (Management Conference) is held.

Purpose(1) Evaluation is more objective because it is done from various
perspectives not only by one’s supervisor, but also by one’s
colleagues and subordinates.
(2) Through the feedback of evaluation comments, each employee
can increase awareness of his or her own strong and weak
points as well as what is expect of him or her in order to modify
his or her behavior appropriately.
(3) This is a system of mutual evaluation by people around you,which will create an appropriate amount of tension in theworkplace.
The awareness of being seen and watched by others can leadto hard work and skill improvement by all employees.

Establishment of outside directors (Board Brain)
Outside directors are elected based on the criteria that they shouldhave broad knowledge and sufficient experience and should be able
to contribute not only to fraud prevention, but also to sustainablegrowth and enhancement of the corporate value of the Company.
Interview with Outside Directors▶
P21“Zentaku Hotlines” are reporting hotlines established inside andoutside the Company to early detect, address, and prevent any
compliance issues.
Zentaku Hotlines
Internal Hotline: An internal reporting hotline for employees
established within the Sustainability Promotion Section
Lawyer Hotline: An internal reporting hotline for employees
established at an external contractor
Partner Zentaku Hotline: A reporting hotline for suppliers
established within the Sustainability Promotion Section

Personnel
Evaluation
OJS

Twice
a yearPromotion
OJS

Once
a yearSustainability Committee

Electronic auditing system: “Fire Lookout Tower”
This is the industry's first electronic auditing system, which waslaunched in June 2001. The system is operated for the purpose of
immediately detecting abnormal events using electronic data ofinternal transactions and taking measures to prevent recurrence.

“Shushazentaku” education“Shushazentaku” is our complianceguidelines to encourage each employee to have high ethical standards andto instill a corporate value that judgment should be made based on justicerather than profit. The Company distributes its compliance manual“TRUSCO Zentaku Book” to all its employees including part-time employees
to implement “Shushazentaku” thoroughly throughout the organization.

Board of Directors (Management Conference)
The Board of Directors meets once a month in principle to makedecisions. The Management Conference seeks a wide range of opinionsfrom attendees that include executive officers and general managers of
departments to ensure a broad perspective and transparency.
Features of the Conference(1) Round-table layout allowing face-to-face communication(2) The seating is changed every time with no regard to seniority tofacilitate participation from new perspectives(3) Management Conference minutes documenting not only the
resolved matters, but also comments of each attendee are disclosed
to all attendees within one week from the date of each meeting.

Compliance manual:
TRUSCO Zentaku Book

Changes in the composition of the Board of Directors

One outside director (female) added
Four internal
directors added

40.0

40.0

41.7

60.0%
●●

62.5

●●

●●

●●

●●

2

3

4

2

3

4

2

3

4

3

3

3

3

3

3

3

2012
49th
period2013
50thperiod2014
51stperiod2014
52nd
period2015
53rd
period2016
54th
period2017
55th
period2018
56th
period2019
57th
period2020
58th
period2021
59th
period

●●

●●

4

●●

4

●●

4

5

5

4

(9 months ended December)

3

3

2

●● ●●

●●

●●

6

●●

22.2

7

33.3

●●

4

42.9%

●●

●●

33.3

●●

●●

●●

●●

62.5

50.0

42.9

●●

37.5

55.6

●●

One outside corporate auditor added●●

Two outside directors took office

50.0

The candidate is evaluated by all other
employees who know him or her, and theresults are reflected in personnel treatment,such as promotion

Evaluation system operation method(1) No specific information of voters is disclosed.
(2) Evaluation is given for three evaluation items on the scale of 1
to 5.
(3) Voting results are reflected in personnel treatment, such as
performance evaluation and promotion.

The old Compliance Committee was renamed to Sustainability
Committee on January 1, 2022. The Sustainability Committee ischaired by the director serving as the Head of the Corporate
Management Division and meets twice a year in principle. The
Committee formulates activity policies and promotes and supervises activities for the purpose of resolving social issues and contributing to sustainable local communities by creating both social
values and corporate values through business. The Committee
also regularly reports to the Board of Directors on relevant matters.

50.0

OJS is conducted among all employees working
in the same workplace (supervisors, colleagues,
subordinates) with each other, and the results
are reflected in performance evaluation.

* All full-time and part-time employees other than officers are subject to evaluation.

* Renamed from CSR Section on January 1, 2022.

44.4

Operation

Category Frequency

Interview video

Zentaku Hotlines

Inside directors
Outside directors
Outside corporate auditors
Percentage of outside officers
Percentage of outside directors

Convocation Notice of the 59th Annual Shareholders’ Meeting

32

P1

Business Report

Open Judge System (OJS; 360 degrees evaluation)

P9
Reference Data

Top-Level Parties Conference (Board Meeting)

Convocation Notice

Governance

P33

Convocation Notice

Reference Materials for
Shareholders’ Meeting

TRUSCO Skills Matrix

The Company has expressed the skills matrix of directors in a T form as shown below by combining the necessary management
skills and the Open Judge System (OJS; 360 degrees evaluation), which we have used for some time. The Company believes
that the most important skill expected of Representative Director and President is the ability to propose management strategies,
measures, and systems. For this reason, the Company discloses management strategies, measures, and systems proposed by
the Representative Director and President as a senior management executive who aims to manage the Company in an ingenious
and original manner. For directors and corporate auditors, in addition to the evaluation of their skills for 11 skill items based on
their experience and track record, the Open Judge System(OJS; 360 degrees evaluation), which has been firmly
embedded in the Company through many years of operation ofOpen Judge System
Commonly used skills
the system, is utilized to increase the fairness and objectivity of(OJS; 360 degrees
matrixthe evaluation. As for the OJS on the Representative Director
Main areas in which each
evaluation)
and President, voting results of shareholders who attended theperson has experience/track
Objective evaluation fromannual shareholders’ meeting each year are disclosed asrecord and is expected tomultiple perspectives
important evaluation indicators (OJS on the President).
contribute

Business Report

P1

Executive Evaluation System Based on Open Judge System(OJS; 360 Degrees Evaluation)

P9

Candidate for executive
director
Promotion

Reference Data

The Company has introduced an evaluation system that evaluates staff with executive posts of adepartment head or higher from multiple aspects. Voters (around 140 persons in the post of
responsible person or higher) vote for each executive member based on the member’s daily Promotion
attitude toward work (4 points × 6 items: full score of 24 points). Promotion or demotion of theexecutive staff member is decided based on the results of the votes as well as the member’s daily
actions and remarks, judgment, responsiveness, problem-solving skills, and ingenuity.

Open Judge System (OJS; 360 degrees evaluation) (4 points × 6 items: full score of 24 points).
Management skills

Originality andcreativity

Problem-solving
abilityCommunication
ability

Shushazentaku(fairness, equitability,and honesty)

3.3

3.2

2.5

3.3

3.4

3.2

19.0

3.5

3.1

3.3

3.3

3.1

3.0

19.4

3.1

2.9

2.8

3.2

3.1

3.1

18.2

3.4

3.0

3.2

3.2

3.3

3.2

19.4

→

Total

(+ 0.1)→

Judgment grasping
the essence(+ 0.2)→(- 0.3)→

P33(+ 0.3)

Demotion
Executive
officer
Demotion
Department head

Directors(Senior Executive Officers)
Kazuo Nakai
Director & Head of Sales
Division

Atsushi Kazumi
Director & Head of Corporate
Management Division, Head of Digital
Strategy Department

Hideki Naoyoshi
Director & Head ofDistribution Division

Tatsuya Nakayama
Senior Executive Officer &Head of Product Division

Kenichi Saito
Outside Director

Kuniaki Hagihara

Outside directors are not subject to OJS.

Outside Director

Takako Suzuki
Outside Director
Objectivity, neutrality, Pointing out problems
common sense, andand proposing
knowledge
improvements

3.1

2.9

2.9

3.1

2.9

3.1

Communication
ability

Shushazentaku(fairness, equitability,and honesty)

2.7

2.9

3.1

17.5

2.9

3.1

3.0

18.1

Part-time corporate auditors are not subject to OJS.

Total(- 0.3)→

Sense ofmanagement andforesight→

Compliance(+ 0.1)

Corporate Auditors
Masaki Matsuda
Full-time Corporate Auditor

Akira Takada
Full-time Corporate Auditor

Hiroho Kamakura
Part-time Corporate Auditor

New appointment

The OJS on corporate auditors has not been conducted.

Hiroaki Imagawa
Executive officer

33

Convocation Notice of the 59th Annual Shareholders’ Meeting*Mr. Imagawa will assume office as Full-time Corporate
Auditor subject to the approval of shareholders at the59th Annual Shareholders’ Meeting of the Company
scheduled for March 18, 2022.

1. Composition of directors

2. Composition of corporate auditors

Convocation Notice

Compositionof officers

3. Percentage of female officers
FemalePercentage
of outside
directors

43％

Internal directors

4Outside directors

3

100％

Internal

OutsideRepresentative Director and PresidentInternal corporate
auditors

0

Outside corporate
auditors

3

Percentage
of femaleofficers

There will be one internal corporate
auditor and two outside corporate
auditors subject to the approval ofshareholders at the 59th Annual
Shareholders’ Meeting of the Company.

10％

Female

1

Male

9

Male

P1

OJS on the President

Tetsuya Nakayama

Attendees of the Meeting

Approval rateof valid votes

Affirmative votes

Representative Director andPresident

324

98.4％

308

303

Business Report

OutsidePercentage
of outside
corporate
auditors

Management strategies, measures, and systems * The Company discloses management strategies, measures, and systems proposed by the Representative
Director and President as it believes that the most important skill expected of Representative Director
and President is the ability to propose management strategies, measures, and systems.
Totally eliminating negotiable instruments, having assets on our own (inventories, real estate, vehicles), decisive management, logistics enhancement strategy,
inventory building measures, Measures to expand direct delivery to users, AI-based quotation system, unifying PBs as TRUSCO, name change to Orange Book,
adopting the number of inventory items and inventory shipping rate as KPIs, MRO Stocker, performance-based dividend policy, free-choice type shareholder
incentive program, proposing TRUSCO Unknown Gulliver, year-round stocking of seasonal products, closing Nara Factory, DOTKUL, Face Phone that allows
for communication with TRUSCO at any time, ICHIOSHI Catalogue, COCOMITE, Orange Book, Jr., product request advertisement, Yattemasen List, stocking“difficult-to-deliver products,” OJS (Open Judge System), staff registry that includes face photos, Orange Doctor Examination, wine seminars, childcare leave
program (3 years), vacation condominiums and sanatoriums for employees, prohibiting non-regular employment of heads of household, as a general rule,establishing Healthcare Section, annual payment of retirement allowance, establishing Trusco Nakayama Health Insurance Association, establishing Marine Club,
donation to Peshawar-kai, supporting Osaka Lovvits (women’s handball team), and establishing The Nakayama Visual Welfare Foundation.

Reference Data

P9

(In 2021) Paid leave accumulation bank program, partial lifting of restrictions on PRO TOOL, enhancement of the childcare leave program for men, infertility
treatment leave program, and visualization of delivery lead times

Areas in which each person has experience/track record
Product
development

Finance/accounting

Personnel affairs
Human resource
development

●

●

●

●

Corporate
management

Sales/marketing

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

●

Corporate
management

Sales/marketing

Product
development

Logistics

Catalogue media

●

●

●

●

Logistics

Catalogue media

●

●

●

●

●

●

Legal affairs/riskmanagement

ESG/
sustainability

Global business

●

●

●

●

●

●

●

●

IT / digital

●

●

●

●

●

●

●

●

●

Legal affairs/riskmanagement

ESG/
sustainability

Global business

●

●

●

●

●

●

●

●

Finance/accounting●

Personnel affairs
Human resource
development●

P33

IT / digital●●

Convocation Notice of the 59th Annual Shareholders’ Meeting34

Convocation NoticeBusiness Report

P1

Candidate no.

Election of seven (7) directors
The terms of office of all seven (7) directors will expire at the closing of the Meeting. Therefore, we would like to ask ourshareholders to appoint seven (7) directors. The director candidates are as below.

1

Re-appointment

なか やま

てつ

Taking common sense by surprisewith logistics DX

Internalや

1. Upgrading our strengths with extraordinary inventory policies
2. Protecting the environment with direct delivery service tousers by wholesalers
3. Enhancing usability with “MRO Stocker,” a system of “usefirst, pay later” that has been around for many years in Japanfor medicine, but for tools
4. Significantly shortening the time to respond to quotation
requests with an AI-based quotation system
5. Realizing high-density storage by introducing a capacity
control system at distribution centers
We will continue to work on functionality enhancement.

Candidate’s profile
Date of birth
December 24, 1958 (63 years old)With the Company
40 years and 11 months
No. of Company shares held
1,260,600
Attendance at Board of Directors’ meeting
100% (12/12 meetings)

Reason for nomination as a director candidate

Reference Data

P9

* The candidates on
P7-11 have no special interest in the Company.
* The average of directors for OJS shown on
P7-8 represents the average score of the three internal directors, rounded to the first decimal place.

Proposal
No. 1

Mr. Nakayama has been nominated as a director candidate, taking into
consideration the results of the OJS on the President, which is a voteby shareholders who attended the previous (58th) Annual Shareholders’ Meeting, as well as management strategies, measures, andsystems invented by him as Representative Director and President, as
important benchmarks.

P33

No. of Attendees

Approval rate

324

98.4％

No. of valid votes *1 Affirmative votes

308

303

Notes: 1. The number of valid votes does not include shareholders who did not
vote on the day of the Meeting (abstention) or those whose votecontents could not be determined (invalid).
2. The OJS on the President is presented on
P8.

Candidate no.

2

なかMarch 1981
October 1984
December 1987
December 1991

Joinded the Company
Director
Managing Director
Representative Director and Senior Managing
Director
December 1994 Representative Director and President (present)

Re-appointment

Meeting diverse needs of customers

Internal

On the back of the COVID-19 pandemic and other major changes
in the business environment, customers’ wishes are increasingly
diverse. We will endeavor to enhance the convenience forcustomers by accurately grasping their issues and proposing
solutions to them.
By utilizing our overwhelming inventory items and range of
products, state-of-the-art logistics system, and IT, we will strive
to become a needed supplier at manufacturing sites.

い

かず

お

Candidate’s profile
Date of birthWith the Company
No. of Company shares held
Attendance at Board of Directors’ meeting

Brief biography, status, business in charge of,and important concurrent posts

July 7, 1969 (52 years old)
28 years and 11 months
4,000
100% (12/12 meetings)

Reason for nomination as a director candidate
The candidate has extensive business experience in sales, distribution, corporate
management, etc., as well as thorough knowledge of the Company’s business ingeneral. The following results of the FY2021 OJS on Directors have also been
adopted as an important benchmark (full score of 24 points: 4 points × 6 items).
Judgment grasping the essence
3.3（Average 3.3）

Management skills
3.2（Average 3.1）

Originality and creativity
2.5（Average 2.9）

Communication ability
3.4（Average 3.2）

Average of directors

Kazuo Nakai
Fairness, equitability, and honesty
3.2（Average 3.1）

April 1993
April 2002
April 2004
April 2008
October 2008
April 2013
January 2017
January 2019

Problem-solving ability
3.3（Average 3.3）

35

Brief biography, status, business in charge of,and important concurrent posts

March 2019
October 2020

19.0

January 2021

Average ofdirectors 18.9

January 2022

Total

Convocation Notice of the 59th Annual Shareholders’ Meeting

Joinded the Company
Head of HC Niigata Sales Office
HC Osaka Branch Manager
Head of Human Resources Section
Head of Human Resources Section & Healthcare
SectionHead of Corporate Planning Department
Executive Officer & Head of Corporate Planning
Department
Executive Officer & Head of Corporate
Management Division
Director & Head of Corporate Management Division
Director & Head of Sales Division
Executive in charge of TRUSCO NAKAYAMACORPORATION (THAILAND) LIMITED (present)
Executive in charge of PT. TRUSCO NAKAYAMAINDONESIA (present)
Director & Head of Sales Division, Head of Home
Center Sales Department & Distribution Department
Director & Head of Sales Division (present)かずInternalみあつし

In an era in which “reform and transformation” is a necessity, I believethat it is important for each employee to work on transformation withgood knowledge of the strengths of their own company. While theCompany has ample room for transformation, it has practiced andcultivated what is necessary for customers, employees, and the society
without being influenced by trends of the times. Cherishing the spirit ofaltruism, I would like to work cheerfully and with passion together with all
our employees to accomplish something that makes someone happy.

Candidate’s profile

Brief biography, status, business in charge of,and important concurrent posts

Date of birth
September 10, 1970 (51 years old)With the Company
28 years and 11 months
No. of Company shares held
4,000 shares
Attendance at Board of Directors’ meeting
100% (12/12 meetings)

April 1993
April 2001
November 2002
April 2006
October 2010

Reason for nomination as a director candidate
The candidate has extensive business experience in sales, digital strategy,
corporate management, etc., as well as thorough knowledge of the Company’sbusiness in general. The following results of the FY2021 OJS on Directors havealso been adopted as an important benchmark (full score of 24 points: 4 points × 6
Judgment grasping the essence
items).

October 2013
April 2014
January 2017

3.5
（Average 3.3）

Problem-solving ability
3.3（Average 3.3）

Management skills
3.1（Average 3.1）

Originality and creativity
3.3（Average 2.9）

Communication ability
3.1（Average 3.2）

Atsushi Kazumi

Candidate no.

4

なお

Average of directors
Fairness, equitability, and honesty
3.0（Average 3.1）

July 2017
January 2019
March 2019
October 2020
Total

19.4

Average ofdirectors 18.9

Successive challenges will drive
the realization of a dream

Re-appointment
Internal

よしひでThe biggest attraction of the Company is that it can think hard how it
can grab the future and help customers and act accordingly without
being afraid of drastic changes in the world. A company can achievesustainable growth only after upholding a high ideal, keep making
efforts without giving up, and getting over a high hurdle together with
its employees. With a commitment in mind to support Japanesemanufacturing all the way through, I would like to do my best,
keeping the gratitude for being allowed to challenge myself to realize
a dream and self-reflection in my heart.

きCandidate’s profile
Date of birth
December 7, 1971 (50 years old)With the Company
27 years and 11 months
No. of Company shares held
4,000 shares
Attendance at Board of Directors’ meeting
100% (12/12 meetings)

Brief biography, status, business in charge of,and important concurrent posts

Reason for nomination as a director candidate
The candidate has extensive business experience in sales, digital strategy,
distribution, etc., as well as thorough knowledge of the Company’s business ingeneral. The following results of the FY2021 OJS on Directors have also been
adopted as an important benchmark (full score of 24 points: 4 points × 6 items).
Judgment grasping the essence
3.1（Average 3.3）
Problem-solving ability
3.2（Average 3.3）

Management skills
2.9（Average 3.1）

Originality and creativity
2.8（Average 2.9）

Communication ability
3.1（Average 3.2）

Average of directors

January 2021

Joined the Company
Head of Tsuchiura Sales Office
Head of Kanazawa Sales OfficeOsaka Branch Manager
Head of Catalog/Media Section & Head of
Dottokuru Section
Head of e-Commerce Sales Department
Head of e-Business Sales Department
Executive Officer & Head of e-Business Sales
Department in charge of Mail Order
Executive Officer & Head of Information Systems Department
Executive Officer & Head of Information Systems Division
Director & Head of Information Systems Division
Director & Head of Corporate Management
Division, Head of Digital Strategy Department,
Head of Digital Promotion Department
Director & Head of Corporate Management Division,
Head of Digital Strategy Department (present)

Hideki Naoyoshi

Fairness, equitability, and honesty
3.1（Average 3.1）

April 1994
October 2003
April 2007
October 2010
October 2011
February 2013
January 2017
July 2017
March 2019
March 2021

Total

18.2

April 2021

Joined the Company
Head of Amagasaki Sales Office
Head of Kokura Sales Office
Head of Corporate Auditor's Office
Head of Corporate Planning Section
Head of Information Systems Department
Executive Officer & Head of Information Systems
Department
Executive Officer & Head of Distribution Division
Director & Head of Distribution Division
Director & Head of Product Divisions, Head ofDistribution Division
Director & Head of Distribution Division (present)

Average ofdirectors 18.9

Convocation Notice of the 59th Annual Shareholders’ Meeting36

Convocation Notice3

Accomplishing one by one somethingthat makes someone happy

Re-appointment

P1

Business Report

Candidate no.

P9Reference Data

Election ofseven (7) directors

P33

Convocation NoticeBusiness Report

P1

Reference Data

P9

P33

Proposal
No. 1
Candidate no.

5

さいElection of seven (7) directors

Re-appointment
Outside

とう

けん

いち

Candidate’s profile
Date of birth
November 15, 1949 (72 years old)
No. of Company shares held
3,200 shares
Attendance at Board of Directors’ meeting
100% (12/12 meetings)
Years of service (at the closing of the Meeting)
6 years

Reason for nomination as an outside director
candidate and outline of expected roles
Mr. Kenichi Saito has experience in a company that conducts
business globally and has founded a management consulting
firm. He has been nominated as a candidate for outside director
for fair and objective guidance toward sustainable growth of theCompany and continuous improvement of its corporate value,as expected of him, based on his experience, and knowledge asa management professional.

Candidate no.

6

はぎRe-appointment
Outside

はら

くに

あき

Candidate’s profile
Date of birthAugust 19, 1953 (68 years old)
No. of Company shares held
3,200 shares
Attendance at Board of Directors’ meeting
100% (12/12 meetings)
Years of service (at the closing of the Meeting)
6 years

Reason for nomination as an outside director
candidate and outline of expected roles
Mr. Kuniaki Hagihara has been nominated as a candidate foroutside director for his abundant experience and broad
knowledge as a manager in manufacturing, as well as his
expected contribution to swift and bold decision-making by the
management, in addition to supervisory functions and advice
from a shareholder's/investor's perspective toward sustainablegrowth of the Company and continuous improvement of its
corporate value.

Creating new experience, rather thanrelying on past experience
The annual growth rate for the last seven years of sales of listedcompanies that were founded before the war was only 2%. Listedcompanies that were founded during the period from the end of the
war through 1990, the year of the collapse of the bubble economy,
achieved 4% for the same period. Listed companies founded after
1990, the period of stagnation, achieved an astonishing 10% for
the same period. Although history is important, companies that are
dependent on experience have not been able to achieve growth.
Likewise, individuals are likely to fall behind if they rely only on theirexperience.

Brief biography, status, and important concurrent posts
April 1975
January 1996
March 2016
October 2017

Joined McKinsey & Company
Founded ForeSight & Company
President (present)
Outside Director of the Company (present)
Founded the Society for Problem-Solving
Proficiency
Representative Director of the Society for
Problem-Solving Proficiency (present)

Criteria for appointment of outside directors and criteria for independence ofoutside officers ▶
P40

Providing information comprisingclues and stimulation to evolution
The reason for existence of Trusco Nakayama lies in strengthening international competitiveness of the Japanese manufacturingsector. How to predict and grasp the opportunities for growth andevolution in anticipation of the situation in the post-COVID era will
be vital. I will strive to provide up-to-date information and cases
comprising hints and stimulation that will contribute to the growthand evolution of the Company, leveraging the experience andsensitivity that I have developed through the management of
manufacturing companies.

Brief biography, status, and important concurrent posts
March 1976
December 1984
January 2010
January 2016
March 2016
June 2018
June 2020
October 2021
January 2022

Joined Hagihara Industries Inc.
President of Hagihara Industries Inc.
President & CEO of Hagihara Industries Inc.
Chairman of Hagihara Industries Inc.
Outside Director of the Company (present)
President of Toyo Heisei Polymer Co., Ltd.
(present)
Outside Director, Wavelock Holdings Co., Ltd.
(present)
Chairman, Toyo Heisei Polymer Co., Ltd.
(present)
Chairman, Hagihara Industries Inc. (present)

Criteria for appointment of outside directors and criteria for independence ofoutside officers ▶
P40

37

Convocation Notice of the 59th Annual Shareholders’ MeetingRe-appointment

7

すず

Outsideき

たかこ

Candidate’s profile

Searching for new domains
The Company continues to evolve at a ultra-high speed to
become what it want to be. Its near-term goal is thedevelopment of a futuristic distribution platform. I would like toconsider, with free thinking not constrained by industry borders
and existing frameworks, how to connect the cutting-edge
capabilities to be gained in the process with the creation of new
business opportunities and thereby contribute to theimprovement of corporate value.

Date of birth
March 5, 1962 (60 years old)
No. of Company shares held
2,500 shares
Attendance at Board of Directors’ meeting
100% (12/12 meetings)
Years of service (at the closing of the Meeting)
2 years

Brief biography, status, and important concurrent posts

Reason for nomination as an outside director
candidate and outline of expected roles

April 2009
January 2010
April 2013
May 2013
March 2020
June 2021

Joined Nissan Motor Co., Ltd.
Joined LVJ Group Co., Ltd. (currently Louis
Vuitton Japan Co., Ltd.)
Representative Director, Chardin Co., Ltd.
Joined S.T. Corporation
President and Chief Operating Officer of S.T.
Corporation
Director, Chardin Co., Ltd. (present)
Outside Director of the Company (present)
Chairperson of the Board and President & Chief
Operating Officer of S.T. Corporation (present)

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Criteria for appointment of outside directors and criteria for independence ofoutside officers ▶
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Notes concerning outside director candidates(1) On independence
Mr. Kenichi Saito, Mr. Kuniaki Hagihara, and Ms. Takako Suzuki areoutside director candidates as set forth in Item 7, Paragraph 3,
Article 2 of the Ordinance for Enforcement of the Companies Act
and fulfill the Company's outside director appointment criteria. They
also fulfill the requirements for independence stipulated by the
Tokyo Stock Exchange as well as the independence criteria foroutside officers stipulated by the Company. We have filed Mr.
Kenichi Saito, Mr. Kuniaki Hagihara, and Ms. Takako Suzuki as
independent officers with the Tokyo Stock Exchange.
(2) On the contract for limitation of liability
In order to acquire personnel who would become outside officers
and to secure their effectiveness, we have concluded a contract forlimitation of liability with Mr. Kenichi Saito, Mr. Kuniaki Hagihara, and
Ms. Takako Suzuki with the amount of limited liability being theminimum total liability amount as prescribed in Paragraph 1, Article
425 of the Companies Act. If their re-appointments are approved,
we are planning to continue the above contract for limitation of
liability.
(3) On special interest in the Company
Mr. Kenichi Saito is the Representative Director of Foresight &Company, whose business with the Company for the past two
years accounts for less than 1 % of the Company's consolidated
net sales. Therefore, there is no important business or otherrelationship between the two companies. Mr. Saito also serves as
Representative Director of the Society for Problem-Solving
Proficiency, with whom the Company has no business or otherrelationship, and there is no special interest that will hinder or posea problem in Mr. Saito's execution of his duties as an outside
director.

Hagihara Industries Inc., of which Mr. Hagihara is the Chairman, andthe Company have a 27-year business relationship. However, ourprocurement from Hagihara Industries accounts for less than 1 % of
our total procurement by amount (less than 3% of the consolidated
net sales of said company). Innovex Co., Ltd., a subsidiary ofWavelock Holdings Co., Ltd., of which Mr. Hagihara is Outside
Director, and the Company has an approximately 20-year business
relationship. However, our procurement from said subsidiaryaccounts for less than 1 % of our total procurement by amount (lessthan 1 % of the consolidated net sales of said company). In
addition, there is no business relationship between Toyo Heisei
Polymer Co., Ltd., of which Mr. Hagihara is the President, and theCompany, and no special interest that will hinder or pose a problem
in Mr. Hagihara's execution of his duties as an outside director.
S.T. Corporation, of which Ms. Takako Suzuki is the Chairperson of
the Board and the President & Chief Operating Officer, has no directbusiness relationship with the Company, but has an approximately
15-year business relationship with the Company through its subsidiary S.T. PRO Co., Ltd. Our procurement from said subsidiaryaccounts for less than 1 % of our total procurement by amount (lessthan 1% of the consolidated net sales of said company). In addition,
there is no business relationship between Chardin Co., Ltd., ofwhich Ms. Suzuki is Director, and the Company, and no special
interest that will hinder or pose a problem in Ms. Suzuki's executionof her duties as an outside director.

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Reference Data

Ms. Takako Suzuki has been nominated as a candidate foroutside director for her abundant experience and broad
knowledge of corporate management, as well as her expected
contribution to swift and bold decision-making by the
management, in addition to supervisory functions and advice
from a shareholder's/investor's perspective toward continuous
growth.

April 1984
August 2001

Convocation Notice

Candidate no.

Business ReportElection ofseven (7) directors

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* The average of corporate auditors for OJS shown below represents the average score of the two full-time corporate auditors, rounded to thefirst decimal place.

Proposal
No. 2

Corporate Auditor Masaki Matsuda will resign at the closing of the Meeting. In addition, the term of office of Corporate Auditor Akira
Takada will expire at the closing of the Meeting. Therefore, we would like to ask our shareholders to appoint two (2) corporate
auditors. This proposal has obtained the consent of the Board of Auditors. The corporate auditor candidates are described below:

Contributing to continuous
improvement of corporate value

Re-appointment
OutsideFull-time

Candidate no.

1

たかElection of Two (2) Corporate Auditors

だあきら

The environment surrounding the Company, including regulatory
and social environment, is changing significantly on a daily basis.
Accordingly, the number of risks that the Company needs tomonitor is increasing. I would like to always consider and act on
how we can be well prepared to respond to these risks and change
them to opportunities so that we can improve the Company further
and thereby to contribute to the growth and sustainable evolution of
the Company.

Candidate’s profile
Date of birthJanuary 3, 1958 (64 years old)
No. of Company shares held
1,400 shares
Attendance at Board of Directors’ meeting
100% (12/12 meetings)
Attendance at Board of Auditors’ meeting
100% (19/19 meetings)
Years of service (at the closing of the Meeting)
4 years

Brief biography, status, and important concurrent posts

Reason for nomination as an outside corporate auditor candidate
The candidate has extensive experience in working for a securities company and an IR consulting
company. In consideration of his knowledge and insight, the Company has determined that the canddate
will be able to properly execute his duties as an outside corporate auditor. He is expected to provide
opinions from an objective standpoint as an outside corporate auditor and thereby to ensure the validity
and appropriateness of decision making by the Board of Directors. The following results of the FY2021
OJS on Corporate Auditors have also been adopted as an important benchmark (full score of 24 points: 4
points × 6 items).

April 1981
Joined Nomura Securities Co., Ltd.
December 2001 Head of IB Consulting Office of Nomura
Securities Co., Ltd.
March 2009Managing Director of IB Business Development
Department of Nomura Securities Co., Ltd.
April 2012
Director of Nomura Investor Relations Co., Ltd.
April 2015
Advisor of Nomura Investor Relations Co., Ltd.
March 2018
Full-time Corporate Auditor of the Company(present)

Sense of management and foresight
2.9（Average 2.9）

Pointing out problems andproposing improvements
2.9（Average 2.8）

Fairness, equitability, and honesty
3.0（Average 3.1）
Objectivity, neutrality,common sense,and knowledge
3.1（Average 3.0）

Communication ability
3.1（Average 3.0）

Akira Takada

Average of corporate auditors

Compliance
3.1（Average 3.1）

Candidate no.

2

いま

がわ

Total

18.1

Average ofcorporate
auditors

17.8

Realizing sustainable growth andcreating new corporate value

New appointment
Internal
Full-timeひろMy name is Hiroaki Imagawa and I have been with the Company for 36
years. As I have been involved in many different departments and divisions
as shown in the brief biography, I would like to draw from this experience
to fulfill my new role. By collaborating with stakeholders as a corporate
auditor, I will perform the duties to maintain a high-quality corporate
governance system that answers to social trust by realizing sustainablegrowth and medium- to long-term creation of corporate value.

あきCandidate’s profile
Date of birthWith the Company
No. of Company shares held

January 22, 1963 (59 years old)
35 years and 11 months
20,000 shares

Reason for nomination as a corporate auditor candidate
The candidate has extensive experience in serving as a senior
executive for many years, as well as thorough knowledge of theCompany’s business in general. He has been nominated as a
candidate for full-time corporate auditor as he is expected, based on
his experience and track record in corporate management, to replace
the roles of the incumbent full-time corporate auditor who will retire at
the closing of the Meeting and to strengthen the governance of theCompany through his duties as a corporate auditor.

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Convocation Notice of the 59th Annual Shareholders’ Meeting

Brief biography, status, and important concurrent posts
March 1986
April 1996
April 1997
April 1998
April 2004
April 2007
October 2013

Joined the Company
Head of Maebashi Sales Office
Head of Ota Sales Office
Tokyo Branch Manager
Executive Officer & Head of NB Product Division
Director & Head of Sales Division
Executive Officer & Head of Factory Sales
Department (East)
January 2016
Executive Officer & Head of Accounting Department
January 2019
Executive Officer & Head of Corporate Planning
Department, Head of Accounting Department
September 2019 Executive Officer, Head of Factory Sales
Department, Head of Distribution Department,
Tokyo Metropolitan Area
January 2022
Executive Officer (present)

Criteria for Appointment of Outside Officers
For the appointment of outside directors and outside corporate auditors, Trusco Nakayama
Corporation (hereinafter referred to as the "Company") sets out the following criteria.
1. Criteria for the Appointment of Outside Directors
The Company appoints outside directors from among those fulfilling the conditions set out below.
(1) Candidates shall be able to contribute to the continuous growth and improvement of
the corporate value of the Company and shall have extensive knowledge and sufficientexperience of business management.
(2) Candidates shall be subject to none of the grounds for disqualification as a director set
out in the items of Paragraph 1, Article 331 of the Companies Act.
(3) Candidates shall fulfill the requirements for an outside director set out in Item 15, Article
2 of the Companies Act.

Proposal
No. 3

Criteria for the Independence of Outside Officers
The Company has set out the criteria for independence as below and deems that an outside
officer is independent if none of the criteria applies thereto.
(1) A major shareholder of the Company (holding 10% or more of the total voting rights in the
Company at the end of the most recent fiscal year) or an individual who serves as a key
employee such as a director, corporate auditor, executive officer, manager, or any other post
higher than department head (hereinafter referred to as "Director, etc.") in an entity that is amajor shareholder of the Company(2) A director, etc., of a corporation or the like of which the Company is a major business
partner (with annual business exceeding 5% of consolidated net sales)(3) A director, etc., of a corporation or the like that is a major business partner of the Company(with annual business exceeding 5% of consolidated net sales)(4) A director, etc., of a corporation or the like that is a major lender to the Company (theCompany borrows more than 2% of its total assets from the lender)(5) An accounting auditor of the Company or its subsidiary, or an individual who is responsible
for auditing the Company or its subsidiary as an employee at the accounting auditor(6) A relative within the third degree of kinship or closer of an individual described in any of theitems numbered 1 to 5 above(7) A relative within the third degree of kinship or closer of an officer, executive officer, or key
employee in a post higher than department head of the Company or its subsidiary(8) An individual to whom any of the items numbered 1 to 7 above has applied within the last
three years

Partial Amendment to the Articles of Incorporation

1. Reasons for the proposal
The Companies Act as amended in 2019 permits companies to take measures to provide reference documents for shareholders’ meeting, etc. in an electronic format and, at the same time,requires companies issuing book-entry transfer shares (listed companies) to stipulate in their Articles of Incorporation that they take measures to provide in an electronic format suchinformation that falls under reference documents for shareholders’ meeting, etc. on or after September 1, 2022, which is the effective date of the amendments to the Companies Act
pertaining to such measures. Therefore, we propose necessary amendments to the Articles of Incorporation.
2. Contents of the amendment
Specific changes in the Articles of Incorporation as proposed are as follows:(The changed parts are underlined.)

Current Articles of Incorporation

Proposed amendments(Internet Disclosure of Reference Materials, etc.)
Article 15 The Company may, in accordance with the applicable provisions of Ministry ofJustice Order, disclose via the Internet any information pertaining to the mattersthat should be included or presented in reference materials for shareholders’meeting, financial statements, and business report.

<Deleted><Newly established>(Measures to Provide Information in an Electronic Format, etc.)
Article 15 
In convening a shareholders’ meeting, the Company shall take measures
to provide in an electronic format such information that falls under reference
documents for shareholders’ meeting, etc.
2. When a shareholder has requested the delivery of materials in a paper-basedformat by the record date of voting rights, the Company may choose not toinclude in the paper document to be delivered to the shareholder the whole orpart of matters prescribed in Ministry of Justice Order if they are provided in anelectronic format.

<Newly established>(Supplementary Provisions)
1. The deletion of Article 15 (Internet Disclosure of Reference Materials, etc.) of the current
Articles of Incorporation and the new establishment of Article 15 (Measures to Provide
Information in an Electronic Format, etc.) of the proposed amendments shall take effecton the effective date of the amendments prescribed in the proviso clause of Article 1 of
the Supplementary Provisions of the Act Partially Amending the Companies Act (Act No.
70 of 2019) (hereinafter referred to as “Effective Date”).
2. Notwithstanding the provisions of the preceding paragraph, the provisions of Article 15(Internet Disclosure of Reference Materials, etc.) of the current Articles of Incorporation
shall remain in full force and effect for any shareholders’ meetings held within six (6)months from the Effective Date.
3. These Supplementary Provisions shall be deleted on the later of the day on which six (6)months have passed since the Effective Date and the day on which three (3) months havepassed since the date of the shareholders’ meeting referred to in the preceding paragraph.

Convocation Notice of the 59th Annual Shareholders’ Meeting

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Business Report

Summary of details on Directors' and Officers' Liability Insurance Agreement
Directors Tetsuya Nakayama, Kazuo Nakai, Atsushi Kazumi, Hideki Naoyoshi, Kenichi
Saito, Kuniaki Hagihara, Takako Suzuki, Corporate Auditor Akira Takada, and Corporate
Auditor candidate Hiroaki Imagawa are scheduled to renew their Directors' and Officers'
Liability Insurance Agreement in June. The Company has concluded with an insurancecompany, and bears the full premiums of, a Directors' and Officers' Liability Insurance
Agreement covering as insured persons the directors, corporate auditors, and executive
officers of the Company and its consolidated subsidiaries. This insurance compensates
for any litigation costs and damages arising from non-derivative actions, shareholder
derivative actions, and corporate actions that are borne by the insured persons inexecuting their duties, provided that they have executed their duties in good faith orwithout violating laws and regulations. (However, measures are taken to ensure that theappropriateness of the execution of duties by the insured persons will not be underminedby excluding from the coverage any damage, etc. to those insured persons who haveengaged in any criminal offence or intentional act of violating laws and regulations.)

2. Criteria for the Appointment of Outside Corporate Auditors
The Company appoints outside corporate auditors from among those fulfilling the conditions
set out below.
(1) Candidates shall have knowledge in fields such as law, finance, accounting, corporate
governance and the like and shall be able to contribute to the improvement ofcorporate value from a neutral and fair standpoint.
(2) Candidates shall be subject to none of the grounds for disqualification as a corporate
auditor set out in Paragraph 1, Article 335 of the Companies Act.
(3) Candidates shall fulfill the requirements for an outside corporate auditor set out in Item
16, Article 2 of the Companies Act.

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Notes concerning the candidates for Proposal No. 1 and Proposal No. 2

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Convocation Notice

Introduction of
Corporate Auditors
Contributing to sound andcontinuous growth

OutsidePart-time
かま

くら

ひろ

ほ

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ProfileDate of birthJanuary 27, 1947 (75 years old)
No. of Company shares held
4,200 shares
Attendance at Board of Directors’ meeting
100% (12/12 meetings)
Attendance at Board of Auditors’ meeting
100% (19/19 meetings)
Years of service (at the closing of the Meeting) 9 years and 8 months

Evaluation as Corporate Auditor
Mr. Hiroho Kamakura provides neutral and fair opinions on the
Company's management and appropriately executes his duties
as an outside corporate auditor based on his knowledge andinsight and from an objective standpoint as an outside corporate
auditor in addition to his broad knowledge and deep insight incorporate management gained through his long experience as acertified public accountant as well as his professional knowledgeof accounting.

Each corporate auditor is an independent organ acting under theentrustment of shareholders. The role of corporate auditors is toconduct both “defensive” and “offensive” audits from an
objective perspective to ensure company’s healthy andcontinuous growth. As an outside corporate with long years ofexperience as a certified public accountant, I would like toactively contribute to the sustainable growth of the Company.

Initiatives in the 59th period
Mr. Hiroho Kamakura provided opinions on the overallmanagement policy, etc., at Board of Directors' and Board of
Corporate Auditors' meetings based on his experience as acertified public accountant who has been involved in the
management of many companies.
He also attended audit report meetings of the accounting auditor,
internal committee, etc., and provided various opinions based on
his professional knowledge as a certified public accountant.

Brief biography, status, and important concurrent posts
November 1971 Joined Tohmatsu Aoki & Co. (currently Deloitte
Touche Tohmatsu LLC)
May 1973
Registered as a Certified Public Accountant
July 2012
Part-time Corporate Auditor of the Company(present)
Part-time Corporate Auditor of Yushin Precision
Equipment Co., Ltd. (present)
March 2013
Part-time Corporate Auditor of Fujio Food
System Co., Ltd. (present)
February 2018 Part-time Corporate Auditor, SymEnergy Inc.
(present)

Message from the Retiring Corporate Auditor
Full-time Corporate Auditor

Masaki Matsuda
Date of birth
March 30, 1956 (65 years old)
No. of Company shares held
18,600 shares
Years of service (at the closing of the Meeting) 14 years and 9 months
Full-time Corporate Auditor Masaki Matsuda will retire at theclosing of the Meeting as he reaches the mandatory retirement
age for corporate officers and will assume the office of advisor.

Message to shareholders
I would like to take this opportunity to inform you that I will retire
as corporate auditor at the closing of the 59th Annual
Shareholders’ Meeting. I would also like to express my deepest
gratitude for the guidance and encouragement you haveprovided to me for many years since my first appointment ascorporate auditor at the 44th Annual Shareholders’ Meeting. I
would appreciate your continued and ever-growing support toTrusco Nakayama Corporation going forward.

What is an advisor?
The Company offers a post of advisor to a person who is qualified
to provide advice to responsible persons drawing from his or her
past knowledge and experience. While the mandatory retirement
age for the officers of the Company is 65, advisors may at theirchoice continue to work until the age of 70.

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Convocation Notice of the 59th Annual Shareholders’ Meeting

Brief biography
April 1978
March 2003
June 2007

Joined the Kyowa Bank, Ltd. (currently Resona
Bank, Ltd.)
Chief Credit Officer of the Osaka No. 3 Loan
Department, Resona Bank, Ltd.
Full-time Corporate Auditor of the Company(present)

1st Section to Prime Market
At its meeting held on September 18, 2021, the Board of Directorsof the Company resolved the selection of the Prime Market fromamong the new market categories of the Tokyo Stock Exchange. Bychoosing the Prime Market, the Company will aim to achieve ahigher level of governance as well as sustainable growth andmedium- to long-term enhancement of corporate
value. On January 11, 2022, the Tokyo Stock Exchangeannounced that the stock of the Company will betransitioned to the Prime Market category among its Corporate
Governancenew market categories.
ReportQ2What is your policy on

payout ratio?

Consolidated dividend payout ratio to be
maintained at 25%

The Company intends to achieve sustainable growth and thereby
maximize the return to its shareholders. Based on the policy thatongoing capital investment is indispensable for the enhancement ofcorporate value, we have prioritized investments in distribution
centers, digital technologies, and human resources to support themto realize stable growth. At this point, after considering the balance
between shareholder return in the form of the enhancement ofcorporate value through capital investment and shareholder return inthe form of dividend, we intend to maintain a consolidated dividend
payout ratio of 25%, which is linked to financial performance, and to
reward our shareholders with the overall return.

Treatment of the impact of special factors,
such as the sale of real estate or shares
In a fiscal year in which net income attributable to owners of parent
has fluctuated significantly due to the sale of real estate or shares
not directly related to business activities or other special factors,
their impact is excluded in the determination of dividend amount.
Dividend of surplus and dividend calculation standard▶
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Q3

How does TRUSCO plan todevelop its overseas
business in the future?

Our consolidated subsidiaries to realize
stable supply of products to satisfy theneeds of foreign companies
Our overseas businesses are operated under the following two
strategies: (i) sales activities by TRUSCO NAKAYAMA CORPORATION(THAILAND) LIMITED and PT. TRUSCO NAKAYAMA INDONESIA,
which maintain their own inventories locally, and (ii) sales activities by
the Overseas Sales Section focusing on the expansion of one-stop
sales to local distributors and the development of new local distributors.
Although our overseas business accounts for only 0.7% of the total net
sales of the Company, we will aim to build further relationships withlocal clients, while focusing on developing new sales channels.

Q4

What are the purposes of yourindustry-academia collaboration andcapital and business partnerships?

To realize the fastest, shortest, and bestdelivery in the industry.
The Company has started industry-academia collaboration with Tokai
National Higher Education and Research System Nagoya University andcapital and business partnerships with GROUND Inc. and Cinnamon Inc. tocreate a new distribution platform “TRUSCO HACOBUne” by making thefull use of AI and latest robots.

Industry-academia collaboration
Tokai National Higher Education and Research System Nagoya University
Purpose of the industry-academia collaboration: For the joint creation of P Aichi
through the effective use of the Human Machine Harmonization System
Consortium and joint research at the JST’s COI-NEXT program and for humanresource development through broad human exchanges and informationexchanges with students, venture company founders, and partner companies
with diverse technical background through, for example, the Graduate Programfor Lifestyle Revolution based on Transdisciplinary Mobility Innovation (TMI).

Capital and business partnerships
GROUND Inc.
Reason for capital contribution: GROUND Inc. is a leading vendor in Japan,
with the ability to achieve overall optimization inside warehouse through theplanning and provision of cutting-edge solutions including robots andAI-powered distribution software. It has also developed very deep insight into
the business of TRUSCO as well as distribution in general through the pastcollaboration with TRUSCO. For this reason, GROUND Inc. is considered tobe the only partner with whom TRUSCO can work together to resolve issues
based on common understanding.
Capital contribution: 500 million yen

Cinnamon Inc.
Reason for capital contribution: Cinnamon Inc. has about 100 AI specialists anda clear track record of introducing AI to financial institutions and others. It has
also put into practice a unique theory called harvest loop and has developed an
AI model suited to the resolution of issues by TRUSCO.
Capital contribution: 500 million yen

Q5What are your responses tobusiness continuity plan anddisaster countermeasures?
A system has been put in place to enable the Company tocontinue its business activities in an emergency situation.
Business continuity system(1) Has 27 distribution centers all over Japan
Risk diversification by maintaining product inventories in various
locations all over Japan(2) Has secured emergency supply routes
When the existing supply route is disrupted due to a disaster, analternative supply route will be supported automatically by other locations.
(3) Ownership of facilities
TRUSCO owns a wide range of facilities from buildings to servers. We can avoid
risks and respond flexibly because we are less dependent on externa parties.

Disaster countermeasures
Seismic isolation equipment has been installed in Tokyo Head Office, Planet
Osaka, Planet Saitama, and Planet South Kanto so that the Company can fulfill its
supply responsibility to clients even in the case of a disaster. Seismic isolationequipment will be installed as standard equipment in all new distribution centers
to be constructed in the future. In addition, Tokyo Head Office is equipped with an
emergency power generator, which can supply electricity for its main systems tocontinue to be operated half a day at the time of power outage, and water gatesto prevent flooding. Furthermore, all important machinery and equipment, such asdata centers, are located on the second floor or above to prepare for emergency.

Overseas Sales Section
We engage in direct international trades with distributors located all over
the world, but mainly in the U.S., Europe, and ASEAN, exporting products
to 20 countries as of December 31, 2021. We will continue to aim tobecome a company that is of service to the global manufacturing sector.

Seismic isolation equipment, Planet
South Kanto

Water gates to prevent flooding, Tokyo
Head Office

Convocation Notice of the 59th Annual Shareholders’ Meeting42

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The reorganization of
the TSE markets

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We answer some of the questions that are frequently asked by shareholders below.

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Frequently Asked Questions

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Responses to COVID-19

Impact of COVID-19 on net sales
Demand for masks and protective clothing as part of measures toprevent COVID-19 infection has returned to normal for the time being.
As production recovers, sales of product groups related to production
at plants and those related to capital investment have increased.

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Under the current COVID-19 pandemic, the Company continues order receiving and delivery operations as before, while
paying close attention to the prevention of infection, in order to fulfill its mission to supply products.We have also taken
various measures to respond to new demand.

Reference Data

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Non-consolidated

Sales analysis for the fiscal year
ended December 2021

PortionPortionPortionattributable to an attributable toattributable toincrease ina decrease in
an increase in demand due toseasonal
demand due to recovery in capital
products
investment
recovery in the
manufacturing+4,019-136
sectorNet sales for
FYE
December
2020(Unit: Million yen)
Portionattributableto other
Net sales for
decreases FY December
2021

Major initiatives
User-direct shipment service
As Internet order needs for
non-contact and non-face-to-facetransactions rise, we expanded
the user-direct shipment service
using six I-Pack® [high-speed automated packaging and shippinglines] introduced at four logistics
centers.
I-Pack® [high-speed automated packaging
and shipping lines]-376

MRO Stocker+12,194
228,906（+7.4%）

213,205
An increase of 15,700 million yen in net sales[Portion attributable to an increase in demand for consumablesupplies due to recovery in the manufacturing sector]+12,194 million yen
Major product categories+3,265 million yen
・Hand tool (hand tools, electric power tools, etc.)+3,012 million yen
・Work supplies (adhesive, packing supplies, etc.)
・Environmental safety supplies (protective equipment for fall
prevention, etc.)+2,074 million yen[Portion attributable to an increase in demand due to recovery incapital investment]+4,019 million yen
Major product categories
・Logistics/storage supplies (transportation goods, loading goods, etc.)+2,354 million yen
・Construction supplies (hardware, construction materials, etc.)+1,665 million yen

We promoted a new service thatenables users to procure products at
any time in their own plants by installingat their plants MRO Stocker, a systemof “use first, pay later” that has beenaround for many years in Japan for
medicine, but for tools. While users arealso promoting digital transformation
and redesigning purchase operations,
we actively made proposals.
Number of companies that have introduced MRO Stocker: 329
Vending machine type MRO Stocker(As of December 31, 2021)

Started in-house manufacturing of masks
We started in-house manufacturing of masks,
the stable supply of which is susceptible tosocial conditions and tends to become difficult
during emergency, at our Hakata Stock Centerin November 2019 (using raw materials madein Japan).

Infection prevention measures
Product name: TRUSCO White Mask
Product number: DPM-WM

Conducted antigen tests on all employees
In addition to daily measures to prevent infection, we conductedantigen tests on all employees (including part-time employees) toprevent the occurrence of a cluster of infection cases in the Company.
Number of tested employees: 2,730
Test results: The Company confirmed that all employees tested
negative (in June 2021).

Vaccination support for employees
The Company conducted workplace vaccination in Tokyo and Osaka incoordination with other companies to ensure that employees who wantto get vaccinated can actually get vaccinated against the newcoronavirus.

Internally developed an employee healthmanagement application “Health Manage”
Employees have been required to measure theirtemperature three times a day since March 1,
2020. The internally developed health management application “Health Manage” enables thecentralized management of the physical conditions of employees and timely follow-ups on employees who reported that they were not feelingwell.We will enhance its health management functions further to strategically support the health of
our employees.

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Convocation Notice of the 59th Annual Shareholders’ Meeting

Shiori Soya, Overseas Procurement Section

Initiatives for the new normal
The Company has taken various measures, including infection
prevention measures and the enhancement of a working from home
program. While these new efforts have led in some way to efficiency
improvement, we have also recognized once again the importance of
face-to-face communication in our business. We will continue toembrace flexible workstyles, while respecting the family backgroundand health conditions of our employees.

Genki Yamaguchi, Corporate Planning Section (to the left),
Mai Tsumura, Sustainability Promotion Section (center), Akira
Suda, Corporate Planning Department (to the right)