These documents have been translated from Japanese originals for reference purposes only.
In the event of any discrepancy between these translated documents and the Japanese originals, theoriginals shall prevail. The Company assumes no responsibility for this translation or for direct, indirect or
any other forms of damages arising from the translations.
Denka Co., Ltd.
(Securities Code: 4061)
NOTICE OF CONVOCATION OF
THE 163RD ORDINARY GENERAL MEETING OF SHAREHOLDERS
Date and Time:

Wednesday, June 22, 2022 at 10:00 a.m.

Place:

Nihonbashi Mitsui Hall, COREDO Muromachi 1 (reception desk on the 4th floor)
2-1, Nihonbashi-Muromachi 2-chome, Chuo-ku, Tokyo

Proposals to be resolved:
Proposal No. 1:
Proposal No. 2:
Proposal No. 3:

Appropriation of Surplus
Partial Amendments to the Articles of Incorporation
Election of Five (5) Directors (Excluding Directors who are Audit & Supervisory
Committee Members)

Please exercise your voting rights in writing or via the Internet by
5:00 p.m. on Tuesday, June 21, 2022.
This year, the Company will not distribute souvenirs or beverages at the General Meeting of Shareholders.
We appreciate your understanding.

1Message from the Management
To Our Shareholders
In this final year and culmination of our “Denka Value-Up” management plan, we will strive to achieve ournumerical targets through the three “Value-Up” initiatives, concerning our business, the environment, and humanresources, aiming to be an indispensable corporate member of society.
Enclosed please find the Notice of Convocation of the 163rd Ordinary General Meeting of Shareholders.
We would like to take this opportunity to express our gratitude to you for your continued support of Denka andmake some observations concerning the Company’s results and current initiatives.
May 2022
Manabu Yamamoto
Chairman and Representative Director
Toshio Imai
Representative Director,
President and Chief Executive Officer
During the fiscal year ended March 31, 2022 (fiscal 2021), the Japanese economy lacked vigor, with personal
consumption and exports continuing to seesaw due to the renewed spread of COVID-19. The global economy
progressed towards recovery overall, even amid the persisting impact of the pandemic, but concerns over theoutlook intensified from the start of 2022, with soaring resource prices due to the impact of Russia’s invasion of
Ukraine, as well as increasingly serious logistics disruptions.
Against this economic backdrop, in order to realize “The Denka Value” corporate philosophy, the Grouppushed ahead with the refocusing of the “Business Portfolio Shift” and the “Introduction of Innovative Processes,”
two strategies set forth in our “Denka Value-Up” five-year management plan launched in 2018, and focused its
efforts on expanding businesses and enhancing profitability, under the three elements of our growth vision: becomea “Specialty-Fusion Company” with “Sustained Growth” and “Sound Growth.” Moreover, we have designated thetwo years from fiscal 2021 as an important preparatory period for rapid growth towards the vision of the nextmanagement plan. As a first step towards being an indispensable corporate member of society, we are engaging inthree “Value-Up” initiatives, concerning our business, the environment, and human resources.
As a result, during the year under review, sales volumes increased, as a consequence of growth in electronics
and highly advanced product lines, focus growth businesses, and COVID-19 rapid antigen test kits, in addition toan overall recovery in demand, which had been depressed due to the pandemic. We also implemented revisions toselling prices in step with rising raw material and fuel prices, and net sales increased. Turning to earnings, operating
income, ordinary income, and profit attributable to owners of parent were all the highest on record, thanks togrowth in specialty products.
In fiscal 2021, the fourth year of “Denka Value-Up,” product groups in the healthcare field and the environment
and energy field, which we had designated as our focus, both saw steady growth, enabling us to achieve our highest
profit ever, as mentioned above. This was the result of the steady progress we have made in “specialization,” thecore strategy of “Denka Value-Up,” over the past four years. In this fiscal year, the final year of the plan, we willcontinue to accelerate “specialization,” and promote the transformation of the business portfolio.
From June last year, we reduced the number of Directors from twelve to nine, with the aim of further enhancing
the effectiveness of discussion by the Board of Directors, expediting its decision-making, and further strengthening
the degree of involvement of Outside Directors in the Board of Directors. We have certainly achieved theimprovements we originally aimed for. However, the requirements placed on corporate governance are growing
ever more sophisticated, including the review of market segments by the Tokyo Stock Exchange and the revisions
to the Corporate Governance Code. We will continue to strive to build corporate governance to accurately respondto social requirements.
Despite the persistently chaotic nature of the global situation, we will continue to promote ESG management,with the SDGs as our compass. In its fifth and final year, we will endeavor to culminate our management plan
“Denka Value-Up” in the solid achievement of our numerical targets through the three “Value-Up” initiatives,
concerning our business, the environment, and human resources, aiming to be an indispensable corporate memberof society. We hope we can count on the continued understanding and support of our shareholders in this endeavor.

2

(Securities Code: 4061)
May 31, 2022
To Our Shareholders:Toshio Imai
President
Denka Co., Ltd.
1-1, Nihonbashi-Muromachi 2-chome, Chuo-ku, TokyoNOTICE OF CONVOCATION OF
THE 163RD ORDINARY GENERAL MEETING OF SHAREHOLDERS
The 163rd Ordinary General Meeting of Shareholders of Denka Co., Ltd. (the “Company”) will be held as
described below.
In order to prevent the spread of the COVID-19, the Company has decided to hold the General Meeting of
Shareholders while taking appropriate measures to counter the spread of the virus with priority given to thesafety of our shareholders (for details thereof, please refer to page 6).
From the perspective of preventing the spread of the virus, the Company requests that shareholders refrainfrom attending the General Meeting of Shareholders in person, view the live broadcast of the meeting, andexercise their voting rights in writing or via the Internet, etc.
The Company strongly recommends that shareholders exercise voting rights in advance. Please review theattached Reference Documents for the General Meeting of Shareholders and exercise your voting rights inwriting by mail (Voting Rights Exercise Form) or via the Internet, etc., as described in the “Guide for Exerciseof Voting Rights” (page 5), by no later than 5:00 p.m. on Tuesday, June 21, 2022.
1. Date and Time:

Wednesday, June 22, 2022 at 10:00 a.m.

2. Place:

Nihonbashi Mitsui Hall, COREDO Muromachi 1(reception desk on the 4th floor)
2-1, Nihonbashi-Muromachi 2-chome, Chuo-ku, Tokyo

3. Meeting Agenda:
Matters to be reported: 1. The Business Report, Consolidated Financial Statements for the Company’s
163rd Term (from April 1, 2021 to March 31, 2022) and results of audits by
the Accounting Auditor and the Audit & Supervisory Committee of theConsolidated Financial Statements
2. Non-consolidated Financial Statements for the Company’s 163rd Term (from
April 1, 2021 to March 31, 2022)
Proposals to be resolved:
Proposal No. 1: Appropriation of Surplus
Proposal No. 2: Partial Amendments to the Articles of Incorporation
Proposal No. 3: Election of Five (5) Directors (Excluding Directors who are Audit &Supervisory Committee Members)◎ The following are posted on the Company’s website at https://www.denka.co.jp/ in accordance withlaw and Article 16 of the Company’s Articles of Incorporation and thus are not included in the
documents attached to this notice of convocation.
•Company’s Systems and Policies (Systems to Ensure the Appropriateness of Operations, Operational
Status of Systems to Ensure the Appropriateness of Operations, and Basic Policies regarding theControl of the Company) in the Business Report•Consolidated Statement of Changes in Net Assets and Notes to Consolidated Financial Statements•Non-consolidated Statement of Changes in Net Assets and Notes to Non-consolidated Financial
Statements

3

The Business Report, consolidated financial statements and the non-consolidated financial statements
audited by the Audit & Supervisory Committee and the Accounting Auditor include the above
documents posted on the Company’s website.
◎ If any revisions are made to the Business Report, Consolidated Financial Statements, Non-consolidated
Financial Statements, or Reference Documents for the General Meeting of Shareholders, they will be
posted on the Company’s website at https://www.denka.co.jp/.

4<Guide for Exercise of Voting Rights>
The following three methods are available for exercising voting rights pertaining to the Company’s General
Meeting of Shareholders.

Exercise of Voting Rights in Writing by Mail (Voting Rights Exercise Form)
Please indicate your vote for or against the proposals on the enclosed Voting Rights Exercise Form and send
the completed form to us so that it is received by 5:00 p.m. on Tuesday, June 21, 2022.
Exercise of Voting Rights via the Internet etc.
Please access the website for exercising voting rights designated by the Company (https://www.web54.net),
use the “Voting Rights Exercise Code” and the “Password” indicated on the enclosed Voting Rights Exercise
Form, and follow the on-screen guidance. Please vote for or against the proposals by 5:00 p.m. on Tuesday,June 21, 2022.
(Inquiry about Exercise of Voting Rights via the Internet etc.)
Sumitomo Mitsui Trust Bank Stock Transfer Web Support Dial
Tel: 0120-652-031(office hours: 9:00 a.m. - 9:00 p.m.)●Exercise of Voting Rights by Attending the Meeting
Please bring the enclosed Voting Rights Exercise Form with you to the meeting and submit it to thereceptionist at the meeting venue.
* In the case of exercising voting rights by attending the meeting as a proxy, please submit a document
evidencing the authority of proxy to the receptionist at the meeting venue together with the Voting Rights
Exercise Form. Please note that such proxy must be one shareholder of the Company with voting rights
in accordance with Article 18 of the Company’s Articles of Incorporation.
Furthermore, the Company will not distribute souvenirs or beverages at the General Meeting of
Shareholders. We appreciate your understanding.
*Handling of duplicated exercise of voting rights
If you exercise your voting rights both by the method of exercising voting rights in writing by mail (Voting
Rights Exercise Form) and by the method of exercising voting rights via the Internet etc., the exercise of
voting rights by the method of exercising voting rights via the Internet etc. shall prevail regardless of the timeof arrival of the votes.
In addition, if you exercise your voting rights multiple times via the Internet, etc., the vote made last shallprevail.

5

Measures to Prevent the Spread of the COVID-19
at the Ordinary General Meeting of Shareholders
The Company regards the safety of its shareholders as its priority. Accordingly, to prevent the spread of
COVID-19, this General Meeting of Shareholders will be held in the manner described below. We request
your understanding and cooperation in this matter.
From the perspective of preventing the spread of the virus, the Company requests that shareholders refrainfrom attending the General Meeting of Shareholders in person, exercise their voting rights in advance, in
writing or via the Internet, etc., and view the live broadcast of the meeting.
<Requests to Shareholders> Please refrain from attending the General Meeting of Shareholders in person.
 The General Meeting of Shareholders will be broadcast live via the Internet, enabling shareholders
to view the meeting from their own homes or elsewhere. Please refer to the enclosed “Information
on Live Broadcast via the Internet” for details, and consider making use of this service.
 Please exercise your voting rights before the meeting in writing (on the Voting Rights Exercise
Form) by mail or via the Internet, as described on page 5.
 The Company’s response may change depending on factors such as the spread of the virus and thedetails of government announcements. Please check on the Company’s website(https://www.denka.co.jp/) for updates, as appropriate.
<The Company’s Response> The Company will not prepare business displays or distribute souvenirs or beverages this year.
 Shareholders who attend the meeting are requested to thoroughly check their state of healthbeforehand and cooperate with measures to prevent infection. These include the compulsory
wearing of masks inside the venue.
 The body temperature of shareholders will be checked near the entrance to the venue, and those
who appear in poor health will be addressed by administrative staff at the meeting, and may berefused entry.
 Shareholders who attend the meeting are requested to cooperate in the use of the liquid handsanitizer provided at the meeting venue.
 Seating will be widely spaced at the venue, and only a very limited number of seats will beavailable as a result. Shareholders may be refused entry once all the seats are taken.
 The Company plans to present a simplified and abbreviated explanation of the Business Report anddetails of each proposal at this General Meeting of Shareholders, from the perspective ofshortening the duration of the meeting as much as possible.
 The health condition, including body temperature, of officers and administrative staff attending this
General Meeting of Shareholders will be checked prior to the meeting, and they will wear masks
while attending.
However, the Company plans to erect a droplet prevention partition in front of the podium used by
the officer who will chair the meeting, enabling him to remove his mask.

6

Reference Documents for the General Meeting of Shareholders

Proposal No. 1: Appropriation of Surplus
It is proposed that the surplus be appropriated as follows:
Matters concerning year-end dividends
In the management plan “Denka Value-Up,” formulated in November 2017, the Company sets out its
basic concepts of safety as No. 1 priority, environmental awareness, fostering and tapping human capital andcontributing to the community, all of which are indispensable for continued growth of the Company. We aim
to realize sustainable and sound growth as a “Specialty-Fusion Company,” through new strategies to achieve
dramatic growth globally.
While the Company has formulated an investment plan as we look to achieve these goals, we have alsoestablished a “Policy on Shareholder Returns,” with a 50% target total payout ratio.
<Shareholder returns in the management plan “Denka Value-Up”>
Committed to a 50% standard for the target total payout ratio*
Regarding shareholder returns, the dividend is prioritized, with flexible purchase of treasury shares,
depending on stock price movements and other factors.
* Total payout ratio = (Dividends paid + treasury stock purchased) / consolidated net income<Investment plan in the management plan “Denka Value-Up”>
Total for five years:¥200.0 billion
Of which strategic investment:¥75.0 billion (¥15.0 billion/year)
M&A, etc.:¥60.0 billion
Process reform:¥15.0 billion
Regular investment:¥125.0 billion (¥25.0 billion/year)
With respect to the year-end dividend for the 163rd term, in view of the above, the Company proposes thefollowing.
(1) Type of dividend property
Cash(2) Allocation of dividend property and total amount thereof¥75 per share of common stock of the Company
Total amount of dividends: ¥6,470,816,325(3) Effective date of dividends from surplus
June 23, 2022

7

Proposal No. 2: Partial Amendments to the Articles of Incorporation
1. Reasons for amendments
The amended provisions stipulated in the proviso of Article 1 of the supplementary provisions of the“Act Partially Amending the Companies Act” (Act No. 70 of 2019) will be enforced on September 1, 2022.
Accordingly, in order to prepare for the introduction of the system for electronic provision of materials forgeneral meetings of shareholders, the Articles of Incorporation of the Company shall be amended asfollows.
(1) The proposed Article 16 provides that information contained in the reference documents for the general
meeting of shareholders, etc. shall be provided electronically and establishes a provision to limit the scopeof matters to be included in the paper copy to be sent to shareholders who have requested it.
(2) The provisions related to the Internet Disclosure and Deemed Provision of the Reference Documents for
the General Meeting of Shareholders, etc. (Article 16 of the current Articles of Incorporation) will become
unnecessary and will therefore be deleted.
(3) In line with the above establishment and deletion of the provisions, supplementary provisions related tothe effective date, etc. shall be established.
2.

Details of amendments
The details of the amendments are as follows.
(Amended parts are underlined)
Proposed Amendments(Deleted)

Current Articles of Incorporation
Article 16. (Internet Disclosure and Deemed
Provision of Reference Documents for the
General Meeting of Shareholders, etc.)
The Company may, when convening a general
meeting of shareholders, deem that it has
provided information to shareholders pertaining
to matters to be described or indicated in thereference documents for the general meeting ofshareholders, business report, non-consolidated
financial statements, and consolidated financial
statements, by disclosing such information
through the Internet in accordance with theprovisions provided in the Ordinance of the
Ministry of Justice.
(Newly established)

Article 16. (Measures for Electronic Provision, etc.)
The Company shall, when convening a general
meeting of shareholders, provide information
contained in the reference documents for thegeneral meeting of shareholders, etc.
electronically.
Among the matters to be provided
electronically, the Company may choose not toinclude all or part of the matters stipulated in the
Ordinance of the Ministry of Justice in the paper
copy to be sent to shareholders who haverequested it by the record date for voting rights.

8Current Articles of Incorporation
Supplementary Provisions

Proposed Amendments(Unchanged)

Contracts concluded by the Company withcorporate auditors (including those who previously
served as corporate auditors) prior to theconclusion of the 160th Ordinary General Meetingof Shareholders to limit their liability for damages
from their actions under Article 423, Paragraph 1of the Companies Act shall be based on Article 37of the Articles of Incorporation as it stood prior toamendment by resolution of the aforementioned
ordinary general meeting of shareholders.
(Newly established)

Supplementary Provisions (Transitional Measures
Concerning the Electronic Provision of Reference
Documents for the General Meeting of Shareholders,etc.)
Article 1. The deletion of Article 16 (Internet
Disclosure and Deemed Provision ofReference Documents for the General Meetingof Shareholders, etc.) of the current Articles ofIncorporation and the proposed Article 16(Measures for Electronic Provision, etc.) shallcome into effect on September 1, 2022 (the“Effective Date”), which is the date ofenforcement of the amended provisions
stipulated in the proviso of Article 1 of the
supplementary provisions of the Act Partially
Amending the Companies Act (Act No. 70 of2019).
Article 2. Notwithstanding the provisions of thepreceding paragraph, Article 16 (Internet
Disclosure and Deemed Provision ofReference Documents for the General Meetingof Shareholders, etc.) of the current Articles ofIncorporation shall remain in force withrespect to a general meeting of shareholders tobe held on a date within six months from the
Effective Date
Article 3. These supplementary provisions ontransitional measures concerning the electronic
provision of reference documents for thegeneral meeting of shareholders, etc. shall bedeleted after the lapse of six months from the
Effective Date or the lapse of three months
from the date of the general meeting ofshareholders set forth in the preceding
paragraph, whichever is later.

9

Proposal No. 3: Election of Five (5) Directors (Excluding Directors who are Audit & Supervisory
Committee Members)
The terms of office of five (5) Directors (excluding Directors who are Audit & Supervisory Committee
Members; hereinafter, the same applies in this proposal) will expire at the conclusion of this Ordinary
General Meeting of Shareholders. Accordingly, the election of five (5) Directors is proposed.
The candidates for Directors are as follows.

No.

Name

1

Reappointed

2

Reappointed

3

Reappointed

4

Reappointed

5

Reappointed
OutsideIndependent
Director

Positions and responsibilities at the Company

Manabu Yamamoto Chairman and Representative Director

Toshio Imai

Tetsuya Shinmura

Kazuo Takahashi

Attendance atBoard ofDirectors
meetings
13/13(100%)

Representative Director, President and Chief Executive
Officer

13/13(100%)

Director, Senior Managing Executive Officer
Chief Technical Officer (CTO)
In charge of Purchasing Dept., Logistics Dept.,
Production & Process Technology Dept.,
Engineering Dept., Digital Strategy & Innovation Dept.
Director, Managing Executive Officer
Chief Compliance Officer (CCO)
Chief Human Resource Officer (CHRO)In charge of HR Dept., Corporate Planning Dept.,
Corporate Communications Dept., Denka Corporation,
Denka Chemicals GmbH

10/10
(100%)(Since taking
office in June
2021)
10/10
(100%)(Since taking
office in June
2021)
10/10
(100%)(Since taking
office in June
2021)

Yoshiyuki Fukuda Director

Reappointed: Candidate for reappointment as Director
Outside: Candidate for Outside Director
Independent Director: Independent Director as notified to the Tokyo Stock Exchange

10

Name
(Date of birth)
No. [Director since][Director's term ofoffice]Career summary and significant concurrent positions, etc.

Number ofshares of theCompany held

April 1981
June 2004

Joined the Company
General Manager of Functional Ceramics Div. ofElectronics Materials Business Group of the Company
April 2009
Executive Officer, General Manager of Electronics
Materials Div. of Electronics Materials Business Group of(Reappointed)
the Company
April 2011
Senior Executive Officer of the Company
Manabu Yamamoto
April
2013
Managing
Executive Officer, Head of Electronics &(March 31, 1956)
Innovative
Products of the Company
Age: 66
June 2013
Director and Managing Executive Officer of the
10,900Company[June 2013]
April
2015
GeneralManagerofCorporate
Planning
Dept.
of
the
[9 yearsCompany* at the conclusion of
April
2016
Director and Senior Managing Executive Officer of thethis Ordinary GeneralCompany
Meeting ofJune 2016
Outside Audit & Supervisory Board Member of Koatsu
Shareholders]
Gas Kogyo Co., Ltd. (until June 2019)
April 2017
Representative Director, President and Chief Executive
Officer of the Company
1
April 2021
Chairman and Representative Director of the Company(present)[Reasons for selection as a candidate for Director]
Through work experience at overseas subsidiaries and many years of responsibility for theelectronics materials business division, Mr. Manabu Yamamoto possesses international
viewpoints and adequate operational experience. After he supervised new businessstrategies and accounting and finance strategies across the entire Denka Group as theexecutive responsible for management strategy, accounting and finance, and investor
relations and corporate communications divisions, Mr. Yamamoto promoted “Denka ValueAttendance at Board Up” as Representative Director, President. As Chairman and Representative Director, heof Directors
currently serves in the position of the Chairman of the Board of Directors, based on his
meetings
deep knowledge and understanding of the Group. The Company has judged that he can
13/13 (100%)
appropriately fulfill the role of supervising the business execution of Directors andExecutive Officers, and requests his election as Director.
[Message to shareholders]
I will strive for more sophisticated corporate governance that accurately reflects social
expectations, by promoting a stronger management advisory and supervisory function andswifter decision-making through the further revitalization of the Board of Directors, inorder to achieve “Denka Value-Up.”
Notes:1. No material relationship of interest exists between the Company and the above candidate.
2. The Company has entered into a directors and officers liability insurance contract with an insurancecompany as stipulated in Article 430-3, Paragraph 1 of the Companies Act to cover legal damages,
litigation expenses and others in the event that a claim for damages is made against the insured persons,
including Directors of the Company. If the appointment of the candidate above is approved, then he will
become an insured person under the contract. The Company intends to renew this insurance contract withthe same contents at the time of the renewal.

11

Name
(Date of birth)
No. [Director since][Director's term ofoffice]Career summary and significant concurrent positions, etc.

April 1982
October 2006
June 2011

Number ofshares of theCompany held

Joined the Company
General Manager, Styrene Div. of the Company(Reappointed)
General Manager, Corporate Planning Dept. of theCompany
Toshio Imai
April 2013
Executive Officer, Assistant to General Manager,(January 25 1959)
Elastomers & Performance Plastics of the Company
Age: 63
April 2015
General Manager, Elastomers & Performance Plastics of
the Company
9,700[June 2019]
April 2017Managing Executive Officer of the Company[3 years
April 2019
General Manager, Denka Value-Up Promotion Dept. of* at the conclusion of
the Company
this Ordinary General June 2019
Director and Managing Executive Officer of the Company
Meeting ofApril 2020
Director and Senior Managing Executive Officer of the
Shareholders]Company
April 2021
Representative Director, President and Chief Executive
2
Officer of the Company (present)[Reasons for selection as a candidate for Director]
Mr. Toshio Imai possesses an international perspective and adequate operational
experience, including work experience at overseas subsidiaries, and taking responsibility
for the styrene and elastomer businesses over many years. After taking charge of businessstrategy for the Denka Group as a whole, including overseas businesses, as the executive
responsible for management strategy and investor relations and corporate communications
Attendance at Board
divisions, he currently serves as Representative Director, President. Based on his richof Directors
experience and impressive track record in Company administration, it is hence judged bymeetings
the Company that he can appropriately fulfil the role of determining important business
13/13 (100%)execution and supervising the business execution of Directors and Executive Officers, andrequests his election as Director.
[Message to shareholders]
In this final fiscal year of the Denka Value-Up plan, I will promote further businessspecialization, aiming to be an “indispensable corporate member of society, creating abetter world by focusing on the jobs that we do best.”
Notes:1. No material relationship of interest exists between the Company and the above candidate.
2. The Company has entered into a directors and officers liability insurance contract with an insurancecompany as stipulated in Article 430-3, Paragraph 1 of the Companies Act to cover legal damages,
litigation expenses and others in the event that a claim for damages is made against the insured persons,
including Directors of the Company. If the appointment of the candidate above is approved, then he will
become an insured person under the contract. The Company intends to renew this insurance contract withthe same contents at the time of the renewal.

12

Name
(Date of birth)
No. [Director since][Director's term ofoffice]Career summary and significant concurrent positions, etc.

Joined the Company
General Manager, Polymers Center, Chiba Plant of theCompany
Tetsuya Shinmura April 2009
Deputy General Manager, Central Research Institute of the(January 28, 1958)
Company
Age: 64
April 2011
Deputy General Manager, Omi Plant of the Company
April 2013
Executive Officer, General Manager, Omi Plant of the
5,300[June 2021]
Company[1 yearApril 2015
General Manager, Technology Dept. of the Company* at the conclusion of April 2017Managing Executive Officer of the Company
this Ordinary General April 2019
General Manager, Omi Plant of the Company
Meeting ofApril 2021
Senior Managing Executive Officer of the Company
Shareholders]June 2021
Director and Senior Managing Executive Officer of the3
Company (present)[Reasons for selection as a candidate for Director]
Mr. Tetsuya Shinmura has adequate operational experience, including research anddevelopment and plant manufacturing. Currently, Mr. Shinmura directs the technicaldivision overall as Chief Technical Officer, while also taking responsibility for the Digital
Strategy & Innovation Dept., a department created to strategically build and operate
Attendance at Board
general information systems for the Group. It is hence judged by the Company that he canof Directors
appropriately fulfil the role of determining important business execution and supervising
meetings
the business execution of Directors and Executive Officers, and requests his election as
10/10 (100%)
Director.
[Message to shareholders]
I will endeavor to enhance corporate value by developing technologies to challenge thepossibilities of chemistry and contributing to the resolution of social issues, to make this acompany genuinely needed by society into the future.
Notes:1. No material relationship of interest exists between the Company and the above candidate.
2. The Company has entered into a directors and officers liability insurance contract with aninsurance company as stipulated in Article 430-3, Paragraph 1 of the Companies Act to coverlegal damages, litigation expenses and others in the event that a claim for damages is madeagainst the insured persons, including Directors of the Company. If the appointment of thecandidate above is approved, then he will become an insured person under the contract. The
Company intends to renew this insurance contract with the same contents at the time of therenewal.
(Reappointed)

April 1980
January 2007

Number ofshares of theCompany held

13

Name
(Date of birth)
No. [Director since][Director’s term ofoffice](Reappointed)
Kazuo Takahashi(March 30, 1960)
Age: 62[June 2021]

4[1 year* at the conclusion ofthis Ordinary General
Meeting of
Shareholders]

Career summary and significant concurrent positions, etc.

April 1983
October 2013
April 2015
April 2017
April 2019
April 2021
June 2021

Joined the Company
Deputy General Manager, Chiba Plant of the Company
General Manager, Ofuna Plant of the Company
Executive Officer, General Manager, Omuta Plant of theCompany
President of Denka Performance Elastomer LLC
Managing Executive Officer of the Company
Director and Managing Executive Officer of the Company(present)

Number ofshares of theCompany held

5,000

[Reasons for selection as a candidate for Director]
Mr. Kazuo Takahashi possesses adequate operational experience, including work
experience in plant manufacturing and overseas subsidiaries. Currently, Mr. Takahashi is
in charge of business strategy for the Denka Group as a whole, including overseas
businesses, as the executive responsible for management strategy, human resources
Attendance at Board
strategy, and investor relations and corporate communications divisions, and he isof Directors
promoting the management plan, “Denka Value-Up.” It is hence judged by the Company
meetings
that he can appropriately fulfil the role of determining important business execution and10/10 (100%)supervising the business execution of Directors and Executive Officers, and requests hiselection as Director.
[Message to shareholders]
As a Director, I will do my very best to consistently ensure rational and appropriate
decision-making that is faithful to our stakeholders.
Notes:1. No material relationship of interest exists between the Company and the above candidate.
2. The Company has entered into a directors and officers liability insurance contract with an insurancecompany as stipulated in Article 430-3, Paragraph 1 of the Companies Act to cover legal damages,
litigation expenses and others in the event that a claim for damages is made against the insured persons,
including Directors of the Company. If the appointment of the candidate above is approved, then he will
become an insured person under the contract. The Company intends to renew this insurance contract withthe same contents at the time of the renewal.

14

Name
(Date of birth)
No. [Director since][Director’s term ofoffice]Career summary and significant concurrent positions, etc.

April 1979
April 2004

Number ofshares of theCompany held

Joined The Industrial Bank of Japan, Limited
General Manager, Business Division No.7 of Mizuho
Corporate Bank, Limited
March 2006
Executive Officer, General Manager, Corporate Banking
Division No.15 of Mizuho Corporate Bank, Limited
April 2007
Executive Officer, General Manager, Securities Division(Reappointed)of Mizuho Corporate Bank, Limited(Candidate forApril 2008
Managing Executive Officer in charge of Corporate
Outside Director)
Banking of Mizuho Corporate Bank, Limited(Independent
April 2010
Managing Executive Officer, Chief Compliance Officer
Director)and Chief Credit Officer of Mizuho Corporate Bank,
LimitedYoshiyuki Fukuda
April 2011
Managing Executive Officer, Head of Corporate Banking(September 8, 1956)
Unit of Mizuho Corporate Bank, Limited–
Age: 65
April 2012Managing Executive Officer, Head of Corporate Banking
Unit (Large Corporations) and Corporate Banking Unit of[June 2021]
Mizuho Corporate Bank, Limited (until March 2013)[1 yearApril 2013
Deputy President and Deputy President-Executive Officer,* at the conclusion of
Head of Investment Banking Division, Head of Public &this Ordinary General
Financial Institutions Group of Mizuho Securities Co.,
Meeting ofLtd. (until March 2014)
Shareholders]April 2014
Chairman of Shinko Asset Management Co., Ltd. (until
November 2015)
November 2015 President & CEO of Fund Corporation for the Overseas
5
Development of Japan’s ICT and Postal Services Inc.
(until June 2021)
June 2021
Outside Director of the Company (present)[Reasons, etc. for selection as a candidate for Director, and summary of expected roles]
Having worked in corporate management at financial institutions for many years, Mr.
Yoshiyuki Fukuda has rich experience and broad insight as a manager and possesses
advanced insights regarding corporate finance, and to utilize these insights and receive
recommendations toward the Company’s overall management, his election as Outside
Director is requested. Additionally, although he used to work at a financial institution thathas transactions with the Company, the Company considers that there is no risk thatconflict of interest with other general shareholders will arise because 1) he is not a current
Attendance at Board or a recent operating officer of the said financial institution; 2) a significant number ofyears have passed since he retired from the said financial institution (9 years have passedof Directors
since his retirement as of the day of this Ordinary General Meeting of Shareholders); 3) the
meetings
composition of borrowings relative to net assets of the Company is low at approximately
10/10 (100%)30%, and the Company’s dependency on the said financial institution is low as it accounts
for less than 10% of overall borrowings; and 4) he satisfies the Company’s “Standards ofIndependence for Outside Directors” and thus, the Company considers that the said
financial institution has no special impact on the Company’s decision-making by the Boardof Directors, etc.
[Message to shareholders]
I will calmly assess the turbulent global conditions, and use this insight to enhance theCompany’s risk management.
Notes:1. No material relationship of interest exists between the Company and the above candidate.
2. Based on Article 427, Paragraph 1 of the Companies Act, the Company currently has a liability limitation
contract with the candidate that limits his liability for damages of Article 423, Paragraph 1 of said Act to apredefined amount of ¥5 million or more or the amount stipulated by laws and regulations, whichever ishigher. If the election of Mr. Fukuda is approved, the Company plans to continue the same contract.

15

3. The Company has entered into a directors and officers liability insurance contract with an insurancecompany as stipulated in Article 430-3, Paragraph 1 of the Companies Act to cover legal damages,
litigation expenses and others in the event that a claim for damages is made against the insured persons,
including Directors of the Company. If the appointment of the candidate above is approved, then he will
become an insured person under the contract. The Company intends to renew this insurance contract withthe same contents at the time of the renewal.

16

(Reference)
1. The Company’s views regarding the election of Directors
In order to promote the management plan, “Denka Value-Up” aimed at realizing “The Denka Value,” theCompany’s corporate philosophy, the Company aims to strengthen the management structure with Directors
and Executive Officers, while enriching the governance structure and supervisory functions.
In electing Directors, internal Directors are chosen from persons who possess a wealth of experience andachievements in various divisions within the Company, while also possessing insights and adequate
specialized knowledge as Director, and Outside Directors are chosen from persons who possess
specialization required for continuous growth and improvement in corporate value of the Company and wide
insights based on a wealth of business experience and management experience at other companies. The
Company believes that it is important for the Board of Directors as a whole to elect a good balance of
personnel with a variety of knowledge, experience, and abilities, and ensure that the composition of theBoard of Directors is diverse in terms of gender, international background, work history, and other factors.
Additionally, the Company believes that Independent Outside Directors should comprise at least one-third of
Directors. The present ratio is approximately 44%.

17

2. Skills Matrix of the Company’s Board of Directors
SkillsManagement

Attributes

experience/Management

HR strategy

International

Finance/

Legal/

Sustainability/

experience

Accounting

Compliance

ESG

strategy

ManabuYamamoto

Toshio Imai

Tetsuya
Shinmura

Kazuo
Takahashi

Chairman and
Representative
Director
Representative
Director,
President and
Chief
Executive
Officer
Director
SeniorManaging
Executive
Officer
Director
Managing
Executive
OfficerBusiness

Research/

strategy/IntellectualMarketingproperty

Production
technology

DX

Age: 66
Years of service: 9

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

Male

Age: 63
Years of service: 3
Male

Age: 64〇

Years of service: 1

〇

〇

〇

〇

〇

〇

〇

〇

〇

Male

Age: 62
Years of service: 1

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

〇

Male
Independent

Yoshiyuki
FukudaOutsideDirector

Age: 65〇〇〇

Years of service: 1
MaleMasaharu
SuzukiToshioKinoshita

Akio
Yamamoto

MiyukiMatobaDirector
Full-time
Audit &
Supervisory
Committee
MemberDirector
Audit &
Supervisory
Committee
MemberDirector
Audit &
Supervisory
Committee
MemberDirector
Audit &
Supervisory
Committee
MemberAge: 66
Years of service: 3

〇

Male

Independent
OutsideAge: 73〇〇

Years of service: 7
Male
Independent
OutsideAge: 70〇〇

Years of service: 7
Male
Independent
OutsideAge: 48〇〇〇

Years of service: 1
Female*The matrix above shows the main skills expected of each Director and does represent all of their knowledge.
*Age and years of service are shown as of the conclusion of this General Meeting of Shareholders.

18

〇

〇

3. Necessary skills for the Company’s Directors and the reason they were selected
The skills considered necessary for the Company’s Board of Directors to make important decisions andsupervise management to reach the goals of the “Denka Value-Up” management plan aimed at realizing“The Denka Value” and to promote ESG management through the priority management materiality issues are
as follows.
SkillsManagement experience/Management strategy
HR strategy

International experience

Finance/ Accounting

Legal/ Compliance

Sustainability/ ESG

Business strategy/
MarketingResearch/ Intellectual
property

Production technology

DX

Reason for the selection of the skills
Directors are needed who have extensive management experience and achievements
to establish management plans aimed at realizing the corporate philosophy of “TheDenka Value” and supervise the execution of duties to achieve these plans.
The Company has identified HR strategy, including securing human resources withspecialized skills, diversity promotion, work style reforms and health and safety
management, as a priority management issue. Directors are needed who haveextensive knowledge and experience related to HR strategy, to be a company where
employees can gain satisfaction and experience personal growth through work.
Directors are needed who have extensive international experience, for the Company
to grow its global presence and aspire to be a company with outstanding competitive
strength in the global market.
Directors are needed who have extensive knowledge and experience in finance andaccounting, not only to ensure the accurate disclosure of financial information, butalso to achieve sound, sustainable growth through strategic investment while
maintaining a sound financial base, and formulate finance policies for shareholder
returns, etc.
Directors are needed who have robust knowledge and experience in the legal andcompliance fields to ensure fair and trustworthy corporate activities through thedissemination of the corporate philosophy, the reform of corporate culture, legal andregulatory compliance, and thorough corporate ethics.
Directors are needed who have robust knowledge and experience related to ESG, as
set forth in the Denka Group ESG Basic Policy and priority management materiality
issues, to promote ESG management across the Group, realize the corporate
philosophy of “The Denka Value,” and aim for sound and sustainable growth.
Directors are needed who have market insight based on a broad perspective, as well
as extensive business experience, to promote the transformation of the businessportfolio, by further focusing on businesses with a top-class share, that are consistent
with ESG initiatives, that are both unique and high value-added, and that are noteasily shaken by the external environment (specialty businesses), and rebuilding thecommodity business.
Directors are needed who have extensive experience in research and development,
who have achievements in promoting innovation, a detailed knowledge of the scienceand technology fields, and are closely familiar with the Company’s unique
technologies and intellectual property, in order to promote reform of the research anddevelopment process while creating new products and technologies that willcontribute to sustainable social development, to accelerate the growth of the Group’s
specialty business.
Directors are needed who are deeply familiar with production technology, including
those unique to the Group, and who have extensive practical experience and robust
insight into manufacturing, to achieve rapid improvements in productivity throughproduction process reform, maintain and enhance equipment safety, disasterprevention, safety and health, and continue to reduce the Group’s environmental
burden as a manufacturer, including through climate change response.
Directors are needed with a profound knowledge and extensive experience related todigital technologies and data utilization, as well as the ability to understand andanalyze the nature of the Group’s business, and use this insight to transform it, inorder to integrate processes of production, research and development, and operations
through DX and bring about the transformation of business models and organization
in innovative processes.

19

4. Standards of Independence for Denka Outside Directors
The Company selects candidates for Outside Directors based mainly on practical considerations, such aswhether we can expect the candidate to contribute to an increase in the corporate value of the Company as anindependent officer. Specifically, the Company has defined the following standards, in accordance with therequirements for independence stipulated in the Companies Act, in addition to the standards forindependence defined by the Tokyo Stock Exchange and other factors.
Standards of Independence for Outside Directors
The standard of independence for an Outside Director of the Company shall be persons that do not fallunder any of the categories defined in items (1) through (5) below.
(1) An executor of business (*4) at a main customer (*1), main supplier (*2), or main lender (*3)
that is a main trading partner of the Company;(2) A consultant, accountant, lawyer, or other such person that has received money or other property
exceeding ¥10 million in value per year from the Company, excluding officer compensation, inthe most recent fiscal year;(3) A person belonging to a group for whom the amount paid by the Company makes up 2% or moreof the group’s revenues or total income in the most recent fiscal year, in cases where the entity
receiving property under item (2) above is a group;(4) A person that has fallen under any of the above categories (1) through (3) within the past year;(5) A spouse or relation within the second degree of a person falling under any of the categories
below (excluding an insignificant person):i.
A person that falls under any of the above categories (1) through (4);ii.
A person that is or was an executor of business at the Company or a subsidiary of theCompany now or within the past year.
(*1) Main customer: A customer from whom the amount paid has made up 2% or more of theCompany’s revenues in the most recent fiscal year(*2) Main supplier: A supplier to whom the amount paid from the Company has made up 2% ormore of the supplier’s revenues in the most recent fiscal year(*3) Main lender: A lender that was essential for the Company’s funding, and that the Company
relied on to the extent the lender was irreplaceable, as of the end of the most recent fiscal
year(*4) Executor of business: An executive director, executive, executive officer, or other
employee, etc.

20

(Reference)
Denka’s Corporate Governance Initiatives
Basic Approach to Corporate GovernanceIn order to fulfill the expectations and trust of its many stakeholders, including shareholders, customers,
local society, and employees, based on “The Denka Value” (corporate philosophy), which forms the basis forthe activities of the Denka Group, the Company strives to strengthen its business foundation by improving its
earnings power and expanding the scope of operations, while also working to improve corporate value bymaking every effort to continue being a company that can win the trust and sympathy of society.
The Company considers corporate governance as the foundation for the above, and so we have striven tostrengthen governance, in order to fulfill the responsibilities we owe to all our stakeholders, and ensure thetransparency and soundness of our management.
The Denka Value (Corporate Philosophy)“The Denka Value” (corporate philosophy) consists of the “Denka Mission,” which represents ouruppermost mission statement, and the “Denka Principles,” a set of precepts guiding actions taken by every
Group employee.
“The Denka Value” lies at the pinnacle of all corporate activities, including management plans, andthrough implementing “The Denka Value,” the Company will work to respond to the expectations and trustof society.
“The Denka Value” (Corporate Philosophy)
The Denka Mission
Taking on the challenge of expanding the possibilities of chemistry to create new value and contribute tosound social development.
Note: Based on the corporate slogan “Possibility of chemistry.”
The Denka PrinciplesWe: Boldly confront challenges with determination and sincerity.
 Think and take action today with the future in mind.
 Deliver new values, and inspire customers through innovative monozukuri.* Respect the environment and create a cheerful workplace that prioritizes safety.
 Contribute to a better society, whilst taking pride in being a trusted corporate citizen.
*Japanese-style craftsmanship21

Current Corporate Governance System

Board of Directors and optional committees■Board of Directors (Met 13 times in fiscal 2021)
To realize the Company’s corporate philosophy, “The Denka Value,” the Board of Directors monitors andsupervises major operational decision-making and execution of business duties by executive officers, basedon strategic and management planning. The Board of Directors as a whole appoints candidates to be
Directors in line with the standards for the appointment of both internal and Outside Directors, based on the
belief that it is important to appoint a good balance of people with a variety of expertise, experiences, andskills. For further details of our approach in appointing members of the Board of Directors, please see page17.
In addition, in principle, the Company has discontinued the use of executive titles, (such as Senior
Managing Director, Managing Director) for Directors, such that all Directors may focus on monitoring andsupervising the execution of business duties from an equal standpoint. Also, the Company has set the lengthof Directors’ (excluding Audit & Supervisory Committee Members) terms to one year, in order to facilitate
flexible checks on them at the General Meeting of Shareholders.
Additionally, the Nomination & Remuneration Advisory Committee has been established as an advisoryorgan of the Board of Directors, to strengthen the roles of the Board of Directors and foster higher standardsof objectivity and transparency. It also organizes the D&A Round Table, aimed at enriching deliberations on
major matters of particular management concern.
■Nomination & Remuneration Advisory Committee (Met 2 times in fiscal 2021)
For major management matters such as nomination, remuneration and other elements of governance, theBoard of Directors has set up the Nomination & Remuneration Advisory Committee, comprising all Outside
Directors, the Chairman and the President, to foster transparency and objectivity in management decisionmaking, informed by a wide range of opinion and advice from Outside Directors.

22

In fiscal 2021, this Committee received inquiries from the Board of Directors regarding the executive andgovernance structure, the formulation of a skills matrix, succession planning, and remuneration for Executive
Officers, and made recommendations and proposals regarding the results of these inquiries after deliberations
at the Committee.
■D&A Round Table (Met 4 times in fiscal 2021)
In order to facilitate in-depth discussions regarding management matters that are of particular importance,
the D&A Round Table is organized as a forum for free, open-minded, constructive discussions, exchange of
opinions and information, and strengthening of cooperation between internal and Outside Directors.
■Evaluation of the Effectiveness of the Board of Directors
At Denka, the effectiveness of the Board of Directors is analyzed and evaluated annually. As a result of
measures taken in fiscal 2020, we reaffirmed that the frequency and duration of meetings of the Board of
Directors and the method of meeting during the COVID-19 pandemic were appropriate, and that the Board
size and composition (in terms of achieving the right balance of expertise, experience, ability and diversity)
was becoming more appropriate. In addition, we affirmed that the monitoring and supervision of the
management were being appropriately implemented by the Board of Directors, 42% of the members ofwhich are Outside Directors.
Furthermore, as the result of a review of the criteria for forming a resolution of the Board of Directors,
one of last year’s issues, we shared an awareness that more time had been secured for discussing priority
matters. We also affirmed that the Company, reaching its second year after the transition to a company with
an Audit & Supervisory Committee, was operating stably under the new structure.
Meanwhile, a view was expressed that measures were needed to utilize the time created through the
rigorous selection of matters for resolution by the Board of Directors to monitor whether long-term businessstrategy and strategies for individual businesses were progressing steadily on the implementation side, and to
discuss any amendments necessary. Moreover, we shared an awareness that an operational structure shouldbe established for the Board of Directors, now in a compact form within the new governance structure, toenable it to place even greater focus on monitoring, advising and supervising the execution of duties, andthat the Nomination & Remuneration Advisory Committee should be further utilized to enable moreautonomous involvement and appropriate supervision of the formulation and implementation of succession
plans.
Looking ahead, in light of these constructive opinions, we will take steps to further improve theeffectiveness of the Board of Directors, aiming to improve medium-to-long-term corporate value, andrespond to the expectations and trust placed in us by our shareholders and numerous other stakeholders.
Audit & Supervisory Committee (Met 14 times in fiscal 2021)
In accordance with their fiduciary responsibilities to shareholders, Audit & Supervisory Committee
Members and the Audit & Supervisory Committee work with the support of the full-time staff of the Audit
Committee Dept., whose independence from management is ensured, to conduct audits of the execution of
directors’ duties, internal control, business duties, and accounting, by exercising statutory rights that include
requesting reports on the businesses of the Company, investigations pertaining to business duties andaccounting, and the appointment, dismissal, non-reappointment, and remuneration of an auditing firm.
In addition, the Audit & Supervisory Committee forms views on matters related to the election, etc. andcompensation, etc. of Directors (excluding Directors who are Audit & Supervisory Committee Members),
including matters to be put forward at the General Meeting of Shareholders.
Furthermore, the Company appoints candidates for Directors who are Audit & Supervisory Committee
Members based on its judgment that, in order for the Audit & Supervisory Committee to fulfill its roles andresponsibilities, Audit & Supervisory Committee Members should possess appropriate experience and ability
as required for their duties, and that in particular, there should be at least one person with expertise in financeand accounting.
Messages from the Directors who are Audit & Supervisory Committee Members“I will focus on auditing the implementation of growth strategy and the response to internal and externalrisks, aimed at the sustainable enhancement of corporate value.”
Masaharu Suzuki, Director (Audit & Supervisory Committee Member)

23

“As the business environment becomes more challenging globally, I am committed to carrying out theaccurate corporate governance required of the Company as a global corporation.”
Toshio Kinoshita, Outside Director (Audit & Supervisory Committee Member)“With the coordinate axes that define the world shifting dramatically, I intend to firmly maintain amedium-to-long-term perspective and a sincere, fair and upright attitude, to contribute to the Company’ssound growth and the enhancement of its corporate value.”
Akio Yamamoto, Outside Director (Audit & Supervisory Committee Member)“I will contribute to enhancing the Company’s corporate value by focusing on the further strengthening ofcorporate governance and thorough compliance.”
Miyuki Matoba, Outside Director (Audit & Supervisory Committee Member)
Outside Directors
Regarding Outside Directors, the Company selects candidates based mainly on practical considerations,such as whether we can expect the candidate to contribute to an increase in the corporate value of theCompany as an independent officer, and has also defined its own standards of independence (please see page20, in accordance with the requirements for independence stipulated in the Companies Act, in addition to thestandards for independence defined by the Tokyo Stock Exchange and other factors.
In addition, by enhancing their understanding of the Company, the Company strives to create anenvironment that allows those appointed as Outside Directors to perform their roles for the sake of thesustainable growth of the Company and the increase of its corporate value.
Specifically, in addition to tours of offices, plants, and other facilities, the Company has been
implementing the following initiatives:■Objective briefings (Met twice in fiscal 2021)
Briefings are held in order to have Outside Directors understand the Company’s medium- to long-termand short-term business and research policies.
■Outside Officer Liaison Committee (Met 4 times in fiscal 2021)
The Company holds “Outside Officer Liaison Committee” meetings to facilitate the exchange of
information and mutual awareness among outside officers concerning matters related to Denka’s corporate
governance and business.

24

Initiatives to Corporate Governance Thus Far
PurposeTo speed up decision-making
2007
Ensure that Directors monitor and supervise theexecution of business on an equal footing
Clear separation of monitoring and supervisory
functions from the execution of business
Flexibly perform checks on directors
Step up checks on management from anexternal perspective
2008
Create system enabling appropriate advicegiving even outside of meetings of the Board of
Directors, by arranging ample exchange of
opinions
Speed up decision-making by deepening
discussions of important management matters

2015

2016

2017

Improve the governance framework and raise
standards of transparency and soundness ofmanagement
Create venues for free, vigorous andconstructive deliberations, exchange of
opinions and information and alliancestrengthening for internal and Outside
Directors and Audit & Supervisory Board
Members
Achieve optimum standards of corporate
governance to ensure sustainable growth andimprove medium to long-term corporate value
Deepen understanding of the Company’sbusiness, and stimulate debate at meetings ofthe Board of Directors
Enable exchange of information and formationof consensus among outside officers
Promote understanding of the Company’s
medium- to long-term and short-term businessand research objectives
Ensure adequate auditing and supervision ofbusiness execution by executive officers
Step up the effectiveness of the Board of
Directors

Foster greater transparency and objectivity inbusiness decision-making, with the Board of
Directors accepting diverse opinions andadvice from the outside officers with regard to
major business topics including appointments,
remuneration and other governance matters

25

MeasuresCut the number of directors by half andintroduce an executive officer system
Abolition of executive titles (such as Senior
Managing Director, Managing Director)
Reassigning the authority of business execution
and executive titles from directors to executive
officers
Shortening the length of directors’
appointments to one year
By appointing two Outside Directors, thenumber of appointments of outside officers
rises to four, including two Outside Audit &Supervisory Board Members (per statutory
requirements)
Implement regular opportunities for outside
officers to exchange opinions with top
management
Establishment of a Management Committee
comprising Directors, Audit & Supervisory
Board Members (internal), and some executive
officers
Increasing the number of Outside Directors(from two to three) and reducing the number ofmembers of the Board of Directors (by two)
To step up round-table meetings of Outside
Directors and Audit & Supervisory Board
Members formerly held twice per year, hold around-table conference of Directors and Audit& Supervisory Board Members
Compilation of the Denka Corporate
Governance Guidelines
Enhance the provision of advance explanationfor outside officers regarding specific agenda
items that require adequate explanation
Holding “Outside Officer Liaison Committee”
four times per year
Holding business and research objective
briefings (currently referred to as objective
briefings) for outside officers twice a year
Clarification of the details of agenda and reportmaterials at the Board of Directors meetings
Arrangement for all Directors and all Audit &Supervisory Board Members to annually
analyze and evaluate the effectiveness of theBoard of Directors, and disclose the results in
the Corporate Governance Report
Establishment of the Management Advisory
Committee comprising all Outside Directors,
all Outside Audit and Supervisory Board
Members, the Chairman and the President
Renaming the “round-table conference of
Directors and Audit & Supervisory Board
Members” the “D&A Round Table”

2019

2021

PurposeFurther strengthen corporate governance andimprove corporate value by further
strengthening the supervisory role of the Boardof Directors, by enabling more rapid decisionmaking and vesting directors who are membersof the Audit & Supervisory Committee withvoting rights at the Board of Directors meeting

Review of regulations regarding theappointment of retirees from the office ofChairman and President as Counselors andAdvisors.
Clarify the roles of the Board of Directors andthe executive structure, further enhance theeffectiveness of discussions at Board of
Directors meetings, and further expedite its
decision-making process26

Measures
Shift from the “Company with Audit &Supervisory Board” model to that of a“Company with Audit & Supervisory
Committee”

Change the name of the “Management
Advisory Committee” to the “Nomination &Remuneration Advisory Committee
Abolish the office of Counselor

Reduce the number of Directors from 12 to 9,
and raise the proportion of Outside Directors
on the Board of Directors to over 44%

[Attached Documents]

Business Report(From April 1, 2021 to March 31, 2022)

1. Overview of the Group(1)

Business Progress and Results
During the fiscal year under review, the Japanese economy lacked vigor, with the continuation ofseesawing trends in personal consumption and exports due to the renewed spread of COVID-19. The
global economy was headed towards recovery overall, even amid the persisting impact of COVID-19, butfrom the start of 2022 onward, concerns grew regarding the future outlook because of factors such asincreasingly severe logistics disruptions, as well as soaring resource prices due to the impact of theRussian invasion of Ukraine.
Against this economic backdrop, in order to realize “The Denka Value” corporate philosophy, theGroup pushed ahead with “Business Portfolio Shift” and “Introduction of Innovative Processes,” twostrategies set forth in our “Denka Value-Up” five-year management plan launched in fiscal 2018, andfocused its efforts on expanding businesses and enhancing profitability, under the three elements of our
growth vision, namely, “Specialty-Fusion Company,” “Sustainable Growth,” and “Sound Growth.” The
Group has designated the two years from fiscal 2021 as an important preparatory period for rapid growth
towards the vision of the next management plan. As a first step towards being an indispensable corporate
member of society, we are engaging in three “Value-Up” initiatives, concerning our business, theenvironment, and human resources.
As a result, during the year under review, sales volumes increased, as a consequence of growth inelectronics and highly advanced product lines, focus growth businesses, and COVID-19 rapid antigen test
kits, in addition to an overall recovery in demand, which had been depressed due to the pandemic. Sales
increased ¥30,458 million or 8.6% year on year to ¥384,849 million, partly due to revisions to selling
prices for certain products in step with rising raw material and fuel prices. Turning to earnings, operating
income increased by ¥5,393 million or 15.5% year on year to ¥40,123 million, the highest on record, andthe ratio of operating income to net sales was 10.4%, an increase of 0.6 percentage points, thanks togrowth in specialty products. Furthermore, ordinary income increased ¥4,331 million or 13.5% to ¥36,474
million, and profit attributable to owners of parent increased ¥3,227 million or 14.2% to ¥26,012 million,
both the highest on record.
From April 1, 2021, the Group’s reportable segments of five divisions were reclassified into four
divisions: Electronics & Innovative Products, Life Innovation, Elastomers & Infrastructure Solutions, andPolymer Solutions. Comparisons and analysis for the fiscal year under review are presented based on the
new classification.
Results of operations by division are described below.
Electronics & Innovative Products Division(Sales: ¥90,152 million; Operating Income: ¥18,656 million)
Principal products: Electronic packaging materials, fine ceramics, fused silica, acetylene black,electronic circuit substrates, industrial tapes, etc.
Sales volumes grew for spherical alumina and high-purity conductive carbon black, primarily for
xEV. Sales of functional films for electronic components and semiconductors, and spherical fused silica
fillers were robust, due to expansion in worldwide demand related to 5G and data centers, etc. In
addition, sales of HITTPLATE aluminum substrate for automotive applications and industrial tapes
increased, and ALONBRIGHT SiAlON phosphors for LED also performed strongly in general.
However, demand was subdued for ALSINK highly reliable heat-dissipating plate for electric railways.
As a result, division sales increased ¥12,403 million or 16.0% year on year to ¥90,152 million, andoperating income increased ¥4,446 million or 31.3% year on year to ¥18,656 million.

27

Life Innovation Division(Sales: ¥46,098 million; Operating Income: ¥15,495 million)
Principal products: Vaccines, diagnostic reagents, joint function improvers, etc.
The COVID-19 Rapid Antigen Test Kit QuickNavi™- COVID19 Ag was supplied to distribution
businesses of the Ministry of Health, Labour and Welfare to enhance rapid antigen testing regimes as partof pandemic countermeasures. Sales of the kit increased due to the renewed spread of the virus from thestart of 2022. Sales of other reagents were also strong, both within Japan and for export. However,shipments of influenza vaccines were down year on year due to lower production volumes from theprevious year, mainly impacted by the proliferation ability of vaccine-producing strains, in addition to ashortage of production materials resulting from the increased production of COVID-19 vaccines
worldwide.
As a result, division sales increased ¥3,151 million or 7.3% year on year to ¥46,098 million, andoperating income increased ¥658 million or 4.4% year on year to ¥15,495 million.
Elastomers & Infrastructure Solutions Division(Sales: ¥106,879 million; Operating Loss: ¥3,473 million)
Principal products: Chloroprene rubber, cement, special cement additives, fertilizers, calcium
carbide, fire resistant materials, environmental materials, etc.
Sales of chloroprene rubber increased year on year as demand began to rise overall, including forindustrial and automotive applications, with the recovery in the global economy. However, the UnitedStates subsidiary Denka Performance Elastomer LLC was impacted by Hurricane Ida, including being
forced to suspend production due to disruption to the upstream supply chain. Moreover, the impact ofsoaring raw material and fuel prices was only partially transferred to selling prices, and sales of special
cement additives also declined year on year.
As a result, division sales increased ¥15,027 million or 16.4% year on year to ¥106,879 million, andoperating loss was ¥3,473 million (operating loss in the previous fiscal year was ¥3,553 million).
Polymer Solutions Division(Sales: ¥126,578 million; Operating Income: ¥7,905 million)
Principal products: Styrene monomer, polystyrene resin, ABS resin, CLEAREN, heat-resistant resin,transparent resin, POVAL, synthetic fiber for wigs, food packaging materials, etc.
Sales of ABS resin, MS resin and styrene monomer at Denka Singapore Pte., Ltd., were robust.
Sales of “TOYOKALON” synthetic fiber for wigs, rain gutters, film for food packaging material andprocessed products were also strong in general.
As a result, division sales increased ¥16,694 million or 15.2% year on year to ¥126,578 million,
partly due to the revision of selling prices in response to rising raw materials prices, and operating
income decreased ¥494 million or 5.9% year on year to ¥7,905 million.
Others Division(Sales: ¥15,140 million; Operating Income: ¥1,904 million)
Principal business: Plant engineering etc.
Transaction volumes of Akros Trading Co. Ltd. and other trading companies increased due to arecovery in demand, but sales decreased due to the application of the Accounting Standard for Revenue
Recognition.
As a result, division sales decreased ¥16,818 million or 52.6% year on year to ¥15,140 million, andoperating income increased ¥1,185 million or 165.0% year on year to ¥1,904 million.

28

(2)

Capital Investment
In the “Denka Value-Up” management plan, the Group is actively implementing strategic investment
under the two growth strategies of “Business Portfolio Shift” and “Introduction of Innovative Processes,”
to meet numerical targets. During the five-year term of the management plan, from fiscal 2018 to fiscal
2022, the Group expects cumulative capital investment to reach ¥210 billion, exceeding the initial plan.
In the fiscal year ended March 31, 2022, the Group carried out capital investments totaling ¥35,644
million.
In the Electronics & Innovative Products Division, capital investment amounted to ¥12,373 million.
The investments were mostly works to expand high purity conductive carbon black capacity at theCompany’s Omuta Plant and our Singapore subsidiary, and works to expand silicon nitride ceramic
substrate capacity at the Omuta Plant.
In the Life Innovation Division, capital investments of ¥3,258 million were made for the Company’s
Gosen Site and other items.
In the Elastomers & Infrastructure Solutions Division, capital investment amounted to ¥13,745
million, which mostly concerned the Company’s Omi Plant.
Capital investment in the Polymer Solutions Division amounted to ¥6,106 million. Principal items
were construction for increased MS resin capacity at Denka Singapore Pte. Ltd., as well as for theCompany’s Chiba Plant.
Main capital investment projects completed during fiscal 2021 included construction for increased
MS resin capacity at Denka Singapore Pte. Ltd. In addition, capital investment projects currently underconstruction include works to increase production capacity for electronics and highly advanced productlines, such as works to enhance production facilities for next-generation functional spherical fillers at theCompany’s Omuta Plant, and works to install new production facilities for heat-dissipating sheets at theShibukawa Plant.

(3)

Financing
In fund procurement, the Company did not obtain any financing through the issue of new shares or
corporate bonds during the fiscal year under review.

(4)

Significant Business Reorganization
Effective April 1, 2021, the Company transferred a portion of the rights and obligations associatedwith its housing business, primarily plastic rain gutters, to its wholly-owned subsidiary, Nakagawa Techno
Industrial Co., Ltd., by conducting an absorption-type company split. Furthermore, effective April 1, 2021,
Nakagawa Techno Industrial Co., Ltd. was renamed Denka Astec Co., Ltd.

(5)

Issues to be Addressed
Since fiscal 2018, the Company has been focusing significant efforts on promoting the “Denka ValueUp” five-year management plan, in order to realize its corporate philosophy “The Denka Value.” Here wewould like to describe some specific measures implemented in fiscal 2021, the fourth year of the plan.
Firstly, in the environment and energy field, we determined to invest ¥5 billion in strategic investmentin the Omuta plant, to enhance production facilities for next-generation functional spherical fillers. This
will expand our lineup of functional filler products for fifth-generation mobile communications systems(5G) and next-generation automobiles (xEV). We also decided to install new production facilities for heatdissipating sheets for 5G and xEV at the Shibukawa Plant, doubling our previous production capacity. We
will proceed to designate the Shibukawa Plant, together with the Omuta Plant, as a core production basefor electronic materials, introducing automated production processes and strengthening the research anddevelopment division within the plant, to focus on developing next-generation specialty products with the
combination of properties such as high thermal conductivity and high thermal resistance required forautomotive and communications applications. In April 2022, we also completed construction of
production facilities for spherical alumina for heat-dissipating materials at our Singapore subsidiary, andcommenced full-scale operation of these facilities. In May, we went on to make the decision to enhance
production capacity at this subsidiary for the spherical silica used as a filler in semiconductor encapsulants.
In this way, in the environment and energy field, we are aiming for further specialization at our production
bases in Japan and overseas.
Next, in the healthcare domain, Daiichi Sankyo Co., Ltd. commenced domestic sales of G47∆
(product name: DELYTACT®*; generic name: teserpaturev), an oncolytic virus for which the Company
has been developing commercial production technology together with Professor Tomoki Todo of The
Institute of Medical Science, The University of Tokyo, from November 2021. We will be responsible for
manufacturing G47∆ under commission from Daiichi Sankyo Co., Ltd. In addition, we completed a new29

influenza vaccine base manufacturing facility wing at the Company’s Gosen Site Niigata Plant. This
doubles our production capacity, and establishes a system that will enable us to provide vaccines even
earlier to the market. We also decided to make a capital investment of approximately ¥11 billion in the
Gosen Site Kagamida Plant. The aim of this investment is to boost production capacity for testing reagent
products, including antigen testing kits, to contribute to global epidemic countermeasures, and tostrengthen our cost competitiveness through digitalization.
Fiscal 2021 was another year marked by the impact of COVID-19. The disruption in global supply
chains was compounded by factors such as Russia’s invasion of Ukraine in February 2022. The Company
steadily continued to pursue the initiatives described above, under the “Denka Value-Up” management
plan. As a result, although results fell short of the initial targets, we were able to record the highest
operating income ever for the second consecutive fiscal year.
In fiscal 2022, we have reached the final year of the “Denka Value-Up” management plan. We willcontinue to focus on the threefold “Value-Up” initiatives that we began in the previous fiscal year, basedon our accumulated achievements over the past four years.
The first initiative is “enhancing the value of our business.” With a constant awareness of megatrends,
we will pursue specialization, the core strategy of “Denka Value-Up,” in each business field, and proceedwith the optimization of the business portfolio.
The second initiative is “enhancing the value of our environment.” Positioning environmental impact
as the foundation of our management, we aim to achieve a 50% reduction in greenhouse gas emissions
by 2030 (compared to 2013), and carbon-neutral status by 2050. To this end, we will steadfastly
implement measures such as reforming the business portfolio, innovating manufacturing processes, andenhancing our hydroelectric power facilities.
The third initiative is “enhancing the value of human resources.” We aim to be a company in which
each employee can perceive personal growth through their job, and we will implement measures such asa more substantial training program, the enhancement of workplace environments, and diversity
promotion.
We will approach fiscal 2022, the final year of the “Denka Value-Up” management plan in this way.
As the culmination of these five years, the whole Group will come together for the last sprint to the finishline. With the SDGs as our compass, we aim to be an indispensable corporate member of society, creating
a better world for all people through the jobs that we do best.
* DELYTACT is a registered trade mark of Daiichi Sankyo Co., Ltd.

30

(6)

Financial Position and Results of Operations
Item

160th term(Millions of yen, unless otherwise stated)
161st term
162nd term
163rd term(from April 1, 2018 to (from April 1, 2019 to (from April 1, 2020 to (from April 1, 2021 toMarch 31, 2019)
March 31, 2020)
March 31, 2021)
March 31, 2022)

Net sales
413,128
380,803354,391
384,849
Operating income
34,22831,58734,72940,123
Ordinary income
32,81130,03432,14336,474
Profit attributable to25,04622,70322,78526,012owners of parent
Net income per share
286.18262.62264.24301.67(yen)
Total assets
483,827
501,448
526,035
557,646
Total net assets
250,481
254,014270,036
292,094
Net assets per share
2,839.16
2,906.95
3,101.92
3,345.34(yen)
Total shareholders’
51.0
50.0
50.8
51.7
equity ratio (%)
Return on equity
10.3
9.1
8.8
9.4
(ROE) (%)
Total dividends paid
10,47910,785
10,785
12,510
Dividends per share
120.00125.00125.00145.00(yen)
Notes: 1. Net income per share is calculated using the average number of shares issued andoutstanding excluding treasury stock. Net assets per share are calculated using thenumber of shares issued and outstanding at the end of the fiscal year excluding
treasury stock.
2. For total dividends paid and dividends per share for the 163rd term, the sum of theinterim dividend paid in December 2021 and the dividend proposed for resolution at
this Ordinary General Meeting of Shareholders is indicated.

31

(7) Significant Subsidiaries (as of March 31, 2022)
1) Significant subsidiaries
Company name

CapitalDenka Chemicals Holdings
Asia Pacific Pte., Ltd.

USD 68,700 thousand

Denka Singapore Pte., Ltd.

SGD 69,410 thousand

Denka Advantech Pte., Ltd.

SGD 17,000 thousand

Denal Silane Co., Ltd.

JPY 500 million

Denka Advanced Materials(Suzhou) Co., Ltd.

CNY 55,440 thousand

Denka Electronic Materials
Dalian Co., Ltd.

JPY 1,000 million

Denka Advanced Materials
Vietnam Co., Ltd.

USD 12,000 thousand

Denka Performance
Elastomer LLC

USD 121,000 thousand

Hinode Kagaku Kogyo

JPY 300 million

Nishi-nihon Koatsu Gas Co.,Ltd.

JPY 80 million

Denka RENOTEC Co., Ltd.

JPY 50 million

Denka Azumin Co., Ltd.

JPY 300 million

Denka Inorganic Materials
Tianjin Co., Ltd.
Denka Infrastructure
Malaysia Sdn Bhd.
Denka Construction Solutions
Malaysia Sdn Bhd.

JPY 250 million
MYR 8,649 thousand
MYR 1,500 thousand

PT. Hissan Trading Indonesia IDR 5,372,640 thousand
DENKA Polymer Co., Ltd.
Denka Astec Co., Ltd.

JPY 2,080 million
JPY 50 million

Denka Chemicals Shanghai
Co., Ltd.

USD 2,000 thousand

Denka Chemicals GmbHEUR 256 thousand

32

The
Company’s
percentage ofequityparticipation

Principal business

Regional headquarters forSoutheast and South Asia
Manufacturing and sales of
100.0
acetylene black and functional(100.0)resin products
Manufacturing and sales of
100.0
fused silica and synthetic fiber(100.0)for wigs and hairpieces
Manufacturing and sales of
51.0
monosilane gas, etc.
Manufacturing, processing,
100.0 and sales of electronic
packaging materials
Processing and sales of
100.0
electronic materials
Manufacturing and sales of
100.0
electronic packaging materials(100.0)and vinyl tapes
70.0 Manufacturing and sales of(70.0) synthetic rubbers
Manufacturing and sales of
100.0 fertilizers and chemical
products
Manufacturing and sales of
93.3
high-pressure gas
Repair, design, engineering
100.0 and management work forconcrete structures
Manufacturing and sales of
100.0 fertilizers and agricultural
materials
Manufacturing and sales of
100.0
special cement additives
100.0 Manufacturing and sales of(100.0) construction chemicals
100.0 Manufacturing and sales of(100.0) construction chemicals
100.0 Sales of special cement(100.0) additives, etc.in Indonesia
Manufacturing and sales of
100.0 various packaging materials
and plastic containers
Manufacturing, processing,
100.0
and sales of rain gutters
Sales of various products and100.0 headquarters for Group
companies in China
Import, export and sales of
100.0 chemical and electronics
products
100.0

Company name

The
Company’s
percentage ofequityparticipation

CapitalPrincipal business

Design and engineering of
100.0 various industrial facilities,
transportation facilities, etc.
Sales of inorganic industrial
products, organic industrial
Akros Trading Co. Ltd.
JPY 1,200 million
76.8 products, civil engineeringand construction materials,
interior materials, etc.
Akros Trading China Co.,
100.0 Sales of electronic packaging
USD 300 thousandLtd.
(100.0) materials, etc.
Sales of resins andAkros Trading Taiwan Co.,
100.0
TWD 29,000 thousandsemiconductor-related
Ltd.
(100.0)materials, etc.
Note: The Company’s percentage of equity participation is calculated by dividing the number ofshares held by the Company by the number of shares issued and outstanding. The figure
within parentheses indicates the percentage of indirect ownership by subsidiaries.
.
Denka Consultant &Engineering Co., Ltd.

JPY 50 million

2) Significant affiliates
Company nameToyo Styrene Co., Ltd.
Denak Co., Ltd.
Kurobegawa Power Plant

The
Company’s
percentage ofequityparticipation

CapitalJPY 5,000 million
JPY 600 million
JPY 3,000 million

33

Principal business

Manufacturing processing
50.0 sales of polystyrene resin andstyrene-based special resin.
Manufacturing and sales of
50.0
monochloroacetic acid
Operation of electric power
50.0 business and other incidental
business

(8) Principal Business Details (as of March 31, 2022)
The Company manufactures and sells the following products.
Business division

Main productsElectronics & Innovative
Products Division
Life Innovation Division
Elastomers &Infrastructure Solutions
Division

Electronic packaging materials, fine ceramics, fused silica, acetylene
black, electronic circuit substrates, industrial tapes, etc.
Vaccines, diagnostic reagents, joint function improvers, etc.

Polymer Solutions Division
Others Division(9)

Chloroprene rubber, cement, special cement additives, fertilizers,
calcium carbide, fire resistant materials, environmental materials, etc.
Styrene monomer, polystyrene resin, ABS resin, CLEAREN, heatresistant resin, transparent resin, POVAL, synthetic fiber for wigs, foodpackaging materials, etc.
Plant engineering etc.

Principal Offices and Factories (as of March 31, 2022)
Company namePrincipal offices
Head Office:1-1, Nihonbashi-Muromachi 2-chome, Chuo-ku,
TokyoBranches:
Tokyo, Osaka, Nagoya, Fukuoka, Niigata, Kanetsu(Saitama), Hokuriku (Toyama), Sapporo, Tohoku(Sendai)
Plants:Omi (Itoigawa, Niigata Prefecture), Omuta, Chiba(Ichihara, Chiba Prefecture), Shibukawa, Ofuna
Denka Co., Ltd.
(Kamakura, Kanagawa Prefecture), Isesaki, Gosen
Research Institutes: Denka Innovation Center (Advanced Technologies
Research Institute, Life Innovation ResearchInstitute, Infrastructure & Solutions Development
Research Institute) (Machida, Tokyo)
Polymer & Processing Technology Institute(Ichihara, Chiba Prefecture)
Denka Chemical Holdings
Head Office: Singapore
Asia Pacific Pte., Ltd.
Denka Singapore Pte., Ltd. Head Office and Plants: Singapore
Denka Advantech Pte., Ltd. Head Office and Plant: Singapore
Denal Silane Co., Ltd.
Head Office: Chuo-ku, Tokyo
Denka Advanced Materials
Head Office and Plant: Suzhou, Jiangsu, China(Suzhou) Co., Ltd.
Denka Electronic Materials
Head Office and Plant: Dalian, Liaoning, China
Dalian Co., Ltd.
Denka Advanced Materials
Head Office and Plant: Hung Yen, Vietnam
Vietnam Co., Ltd.
Denka Performance
Head Office and Plant: Louisiana, United States
Elastomer LLC
Hinode Kagaku Kogyo
Head Office and Plant: Maizuru, Kyoto Prefecture
Nishi-nihon Koatsu Gas
Head Office: Fukuoka, Fukuoka PrefectureCo., Ltd.
Denka RENOTEC Co.,
Head Office: Chuo-ku, TokyoLtd.
Denka Azumin Co., Ltd.
Head Office and Plant: Hanamaki, Iwate Prefecture
Denka Inorganic Materials
Head Office and Plant: Tianjin, China
Tianjin Co., Ltd.
Denka Infrastructure
Head Office and Plant: Selangor, Malaysia
Malaysia Sdn Bhd.
Denka Construction
Solutions Malaysia Sdn
Head Office and Plant: Selangor, Malaysia
Bhd.
34

Company namePT. Hissan Trading
Indonesia
DENKA Polymer Co., Ltd.
Denka Astec Co., Ltd.
Denka Chemicals Shanghai
Co., Ltd.
Denka Chemicals GmbH
Denka Consultant &Engineering Co., Ltd.
Akros Trading Co., Ltd.
Akros Trading China Co.,Ltd.
Akros Trading Taiwan Co.,Ltd.

Principal offices
Head Office: Jakarta, Indonesia
Head Office: Koto-ku, Tokyo
Plants: Sakura, Katori (Tako-machi, Chiba Prefecture), Goi (Ichihara,
Chiba Prefecture)
Head Office: Minato-ku, Tokyo
Plant: Kasai, Hyogo Prefecture
Head Office: Shanghai, China
Head Office: Düsseldorf, Germany
Head Office: Ichihara, Chiba Prefecture
Head Office: Minato-ku, Tokyo
Head Office: Shanghai, China
Head Office: Hsin-Chu, Taiwan(10) Employees (as of March 31, 2022)
1) The Group
Business segment
Number of employees
1,550
[169]
Electronics & Innovative Products Division
Life Innovation Division
929
[285]
Elastomers & Infrastructure Solutions Division
1,564
[211]
Polymer Solutions Division
1,167
[208]
Others Division
767
[164]
Corporate (common)
381
[64]
Total
6,358 [1,101]
Notes: 1. The number of employees indicated is the number of full-time employees and theannual average number of temporary employees is indicated in brackets.
2. The number of employees indicated for “Corporate (common)” is the number of
employees who belong to administrative divisions that cannot be classified into a
specific business.
2) The Company
Increase (Decrease)from the previous
Average age
Average service years
fiscal year-end
4,081 [726](85) [+29]
40.8
16.8
The number of employees indicated is the number of full-time employees and the annual
average number of temporary employees is indicated in brackets.

Number of employees
Note:

35

(11) Principal Lenders (as of March 31, 2022)
LenderOutstanding borrowings (Millions of yen)
Syndicated loan
37,000Mizuho Bank, Ltd.
16,088M&A loans
12,442The Norinchukin Bank
5,685
Sumitomo Mitsui Banking Corporation
5,078
Notes: 1. The syndicated loan is managed by Mizuho Bank, Ltd. and Sumitomo Mitsui Banking
Corporation and is co-financed.
2. M&A loans refers to an overseas M&A support loan system maintained by the Japan
Bank for International Cooperation in cooperation with private banks.
(12) Other Significant Matters concerning the Group’s Current Situation
Not applicable.

362. Status of Shares (as of March 31, 2022)(1) Total Number of Authorized Shares

290,000,000 shares(2) Shares of Common Stock Issued

88,555,840 shares(including 2,278,289 shares of treasury stock)(3) Number of Shareholders

42,802(4) Major Shareholders
Number of shares
held(hundred shares)
156,560
77,928

Shareholder name

Percentage ofshares held
(%)
18.15
9.03

The Master Trust Bank of Japan, Ltd. (Trust Account)
Custody Bank of Japan, Ltd. (Trust Account)
Mizuho Trust & Banking Co., Ltd. Retirement Benefit
Trust Mizuho Bank Account32,1583.73(Account re-entrusted by Custody Bank of Japan, Ltd.)
National Mutual Insurance Federation of Agricultural
29,007
3.36
Cooperatives
TAIJU LIFE INSURANCE COMPANY LIMITED
23,816
2.76
Japan Post Insurance Co., Ltd.
18,105
2.10
SSBTC CLIENT OMNIBUS ACCOUNT
15,883
1.84
STATE STREET BANK AND TRUST COMPANY
14,2111.65505001
Denka Employee Stockholding Association
12,345
1.43
JP MORGAN CHASE BANK 385781
11,2131.30
Notes: 1. 2,278,289 shares of treasure stock have been excluded from the above list of major
shareholders.
2. Treasury stock is excluded for calculation of the percentage of shares held.
(5) Other Significant Matters concerning Shares
Not applicable.

3. Matters concerning the Company’s Stock Acquisition Rights (as of March 31, 2022)
Not applicable.

374. Company Officers(1)

Directors (as of March 31, 2022)
Name
Manabu Yamamoto
Toshio Imai

Position
Chairman and
Representative
Director
Representative
Director, President

Tetsuya Shinmura

Director

Kazuo Takahashi

Director

Yoshiyuki Fukuda

Director (Outside)
Director (Full-time
Audit & Supervisory
Committee Member)

Masaharu Suzuki

Toshio Kinoshita

Director (Outside)(Audit & Supervisory
Committee Member)

Responsibilities and significant concurrent positions

President and Chief Executive Officer
Senior Managing Executive Officer
Chief Technical Officer (CTO)
In charge of Purchasing Dept., Logistics Dept.,
Production & Process Technology Dept.,
Engineering Dept., Digital Strategy & Innovation Dept.
Senior Managing Executive Officer
Chief Compliance Officer (CCO)
In charge of Corporate Planning Dept., Corporate
Communications Dept., Automotive Materials &Solutions Dept., Denka Corporation, Denka Chemicals
GmbH
In charge of Denka Value-Up Promotion

Representative Director of Global Professional Partners
Outside Audit & Supervisory Board Member ofPanasonic Corporation
Outside Director of TACHI-S CO., LTD.

Director (Full-time
Audit & Supervisory
Committee Member)
Director (Outside)
General Manager, Intellectual Property and Legal Div.,
Miyuki Matoba(Audit & Supervisory General Affairs H.Q., and compliance supervisor ofCommittee Member)
NITTO KOHKI CO., LTD.
Notes: 1. Directors Mr. Yoshiyuki Fukuda, Mr. Toshio Kinoshita, Mr. Akio Yamamoto, and Ms.
Miyuki Matoba are outside directors as stipulated in Article 2, Item 15 of theCompanies Act.
2. Director who is an Audit & Supervisory Committee Member, Mr. Toshio Kinoshita isa certified public accountant, and has an adequate level of knowledge regarding
finance and accounting.
3. Director who is an Audit & Supervisory Committee Member, Mr. Toshio Kinoshita
retired as Outside Director of GiG Works Inc. in January 2022.
4. The Company has appointed Director Mr. Masaharu Suzuki as a Full-time Audit &Supervisory Committee Member, in order to enhance the effectiveness of audits throughbetter information gathering and sufficient coordination with the Internal Control Dept.,
etc., and thereby strengthen audit and supervisory functions.
5. The Company designated Directors Mr. Yoshiyuki Fukuda, Mr. Toshio Kinoshita, Mr.
Akio Yamamoto, and Ms. Miyuki Matoba as independent officers as defined by Tokyo
Stock Exchange, Inc. and notified it of the designation.
6. Panasonic Corporation was renamed Panasonic Holdings Corporation effective April 1,
2022.
Akio Yamamoto

38

(Reference)
Executive Officers (as of May 1, 2022)
Position
President and Chief
Executive Officer
Senior Managing
Executive Officer
Managing Executive
OfficerName
Toshio Imai
Tetsuya Shinmura
Koki Tabuchi
Shojiro Watanabe
Nobuyuki Yoshino
Kazuya Tokumoto
Hideki Takahashi
Kazuo Takahashi

Executive Officer

Responsibilities

Rimiru Hayashida
Yoshimi Ishizuka
Kiyoshi Asami
Ikuo Ishida
Yasuo Nakatomi
Yukio Sasagawa
Mikio Shimizu
Hideki Toya
Masanobu Kosaka
Kenjiro Ishizuka
Michio Kawamura

Chief Technical Officer (CTO)
In charge of Purchasing Dept., Logistics Dept.,
Production & Process Technology Dept., Engineering
Dept., Digital Strategy & Innovation Dept.
General Manager, Elastomers & Infrastructure
SolutionsSupervisor of Environmental Measures Promotion
In charge of Internal Control Dept., Environment and
Safety Dept., Sustainability Promotion Dept., Quality
Assurance Dept.
Chief Scientific Officer (CSO)
General Manager, New Business Development
General Manager, Chiba Plant
General Manager, Life Innovation
Chief Compliance Officer (CCO)
Chief Human Resource Officer (CHRO)In charge of HR Dept., Corporate Planning Dept.,
Corporate Communications Dept., Denka Corporation,
Denka Chemicals GmbHIn charge of Accounting & Finance Dept., Finance
Dept.
General Manager, Omuta Plant
In charge of Secretary Dept., Administrative Dept.,
Legal Dept.
General Manager, Electronics & Innovative Products
General Manager, Gosen Site
General Manager, Shibukawa Plant
President, Denka Performance Elastomer LLC
Assistant to New Business Development
General Manager, Innovation Center
General Manager, Omi Plant
General Manager, Polymer Solutions
Managing Director, DCHA, DSPL, DAPL

Notes: DCHA: Denka Chemicals Holdings Asia Pacific Pte., Ltd.
DSPL: Denka Singapore Pte., Ltd.
DAPL: Denka Advantech Pte., Ltd.

39

(2)

Directors who Retired during the Fiscal Year Under Review
Name

Date ofretirement

Reason for retirement

Shinsuke Yoshitaka

June 22, 2021

Expiration of term of office

Norihiro Shimizu
Masaharu Suzuki
Akio Yamamoto
Tatsutsugu Fujihara

June 22, 2021
June 22, 2021
June 22, 2021
June 22, 2021

Expiration of term of office
Expiration of term of office
Expiration of term of office
Expiration of term of office

Mitsukuni Ayabe

June 22, 2021

Expiration of term of officeJunichi Kimura

June 22, 2021

Expiration of term of office

Yasuo Sato

June 22, 2021

Expiration of term of office

Hiroko Yamamoto

June 22, 2021

Expiration of term of office

Position, responsibilities andsignificant concurrent
positions at the time ofretirement
Director, Senior Corporate
AdvisorOutside Director of Koatsu
Gas Kogyo Co., Ltd.
Director, Executive Fellow
Director, Advisor
Director (Outside)
Director (Outside)
Director (Full-time Audit &Supervisory Committee
Member)Director (Full-time Audit &Supervisory Committee
Member)Director (Outside)(Audit & Supervisory
Committee Member)
Chairman and Director of
Wisemech Corporation
Director (Outside)(Audit & Supervisory
Committee Member)
Lawyer, Sasanami Law Office

Note: Mr. Masaharu Suzuki and Mr. Akio Yamamoto retired as Directors due to the expiration of their terms of office, andwere appointed Directors who are Audit & Supervisory Committee Members the same day.

(3) Summary of Liability Limitation Agreements
Based on Article 427, Paragraph 1 of the Companies Act, the Company currently has liability
limitation contracts with Directors Mr. Yoshiyuki Fukuda, Mr. Toshio Kinoshita, Mr. Akio Yamamoto,and Ms. Miyuki Matoba that limit their liability for damages provided for in Article 423, Paragraph 1 ofsaid Act. The limit of liability under the contract is set to a predefined amount of ¥5 million or more or
the amount stipulated by laws and regulations, whichever is higher.
(4) Summary of Directors and Officers Liability Insurance
The Company has entered into a directors and officers liability insurance contract with an insurancecompany as stipulated in Article 430-3, Paragraph 1 of the Companies Act. The Company’s Directors(including Directors who are Audit & Supervisory Committee Members), Executive Officers, andDirectors, Corporate Auditors and Executive Officers of some of the Company’s Group companies are
insured parties under the contract. As a rule, the insured parties are not responsible for paying insurance
premiums.
The Directors and officers liability insurance covers legal damages and litigation expenses in theevent that a claim for damages is made against the insured persons due to an act committed by aninsured person in his/her capacity as such. However, measures have been implemented to ensure thatproper execution of duties by officers, etc. is not impaired. These include an exclusion where theCompany makes a claim for damages against the insured parties, as well as the establishment of adeductible amount.
(5) Remuneration and Other Payments to Directors
1) Policy on the determination of remuneration and other payments to individual Directors
The Board of Directors of the Company has decided on the following policy for determining
remuneration and other payments to individual Directors (hereinafter referred to as the “Decision

40

Policy”), after receiving recommendations and proposals from the Nomination & Remuneration
Advisory Committee.
[Basic Policy]
Remuneration for individual Directors (excluding Directors who are Audit & Supervisory Committee
Members; the same applies hereinafter) shall be in accordance with each Director’s roles andresponsibilities, and shall be determined by the Board of Directors after receiving recommendations andproposals from the Nomination & Remuneration Advisory Committee, and set forth in internal
regulations, in order to enhance objectivity and transparency.
The structure of Directors’ remuneration shall, in addition to a fixed monthly amount of basic
remuneration, consist of performance-linked cash remuneration, designed to increase motivation to
improve the financial results for each fiscal year, and stock remuneration, designed to increase
motivation to contribute to improving medium- and long-term performance and enhancing corporate
value. These function as sound incentives to maintain growth. However, in view of the duties performedby Outside Directors and non-executive Directors, remuneration for these Directors shall consist solelyof basic remuneration.
[Policy on the determination of remuneration and other payments to individual Directors]i) Policy on the determination of the amount and calculation method of basic cash remuneration.
Basic remuneration shall be determined in accordance with each Director’s roles and responsibilities,
taking into consideration factors such as the level of employee pay. It shall be paid in a fixed amountevery month.
ii) Policy on the determination of the performance indicators, amount and calculation method of
performance-linked cash remuneration
The total amount of performance-linked remuneration shall be determined with reference toconsolidated operating income, a key indicator under the Company’s management plan. It shall thenbe allotted in accordance with each Director’s roles and responsibilities, and paid promptly after thefinancial results are finalized. However, if consolidated operating income is below a certain level, ora massive extraordinary loss is recorded, or if a serious compliance breach has occurred, then no
payment shall be made, or the payment amount shall be reduced.
iii) Policy on the determination of the details, amount and calculation method of stock remuneration
The stock remuneration scheme shall utilize a trust structure. Points shall be granted to Directors
each month in accordance with rank, based on stock delivery regulation established by the Company,
and shares of the Company’s stock shall be delivered to Directors through the trust on retirement,
based on the number of points they have accumulated. The maximum amount of money to becontributed by the Company to the trust for the purpose of delivering the Company’s shares to
Directors shall be ¥40 million per year.
iv) Policy on the determination of the proportions of the total amount of remuneration paid as basic
remuneration, performance-linked remuneration, and stock remuneration
No policy is established specifically to determine the proportion of Directors’ remuneration to be
paid as basic remuneration, performance-linked remuneration, and stock remuneration. However, if
the operating income target under the management plan is achieved, then the proportions will beapproximately 70%, 20% and 10% respectively.
v) Method used to determine remuneration and other payments to individual Directors
The details of remuneration and other payments to individual Directors shall be determined by the
Board of Directors, after receiving recommendations and proposals from the Nomination &Remuneration Advisory Committee, and set forth in internal regulations.
2) Reason why the details of remuneration and other payments to individual Directors are judged by
the Board of Directors to be in accordance with the Decision Policy
The Board of Directors establishes the details of remuneration in internal regulation, in accordancewith the Decision Policy, after receiving recommendations and proposals from the Nomination &Remuneration Advisory Committee. Remuneration for individual Directors is determined based on theseregulations. Therefore, the Board of Directors deems it to be in accordance with the Decision Policy.

413) Remuneration and other payments to Directors

Category

Numberofpersons

Amount of
remuneration,
etc.
(Millions ofyen)

Breakdown
Cash remuneration
Performance-linked
Basic remuneration
remuneration
Number
Total
Number
Totalof(Millionsof(Millionspersonsof yen)personsof yen)Stockremuneration
Numberofpersons

Total(Millionsof yen)Directors(excluding
Directors
who areAudit &
10
312
10
242
4
47
7
22
Supervisory
(3)
(15)
(3)
(15)
(-)
(-)
(-)
(-)
Committee
Members)(of whichOutsideDirectors)
Directors(Audit &Supervisory
Committee
878
878
Members)
(5)
(36)
(5)
(36)
(-)
(-)
(-)
(-)
(of whichOutsideDirectors)
Total(of which
18
391
18
320
4
47
7
22
Outside
(8)
(51)
(8)
(51)
(-)
(-)
(-)
(-)
Directors)
Notes: 1. The maximum amount of cash compensation remuneration for Directors (excluding
Directors who are Audit & Supervisory Committee Members) is ¥490 million per year(of which the maximum amount of remuneration for Outside Directors is ¥40 million,
excluding the portions of their salaries as employees) as resolved at the 160th
Ordinary General Meeting of Shareholders held on June 20, 2019. There were 7
Directors (excluding Directors who are Audit & Supervisory Committee Members),
including 2 Outside Directors, as of the conclusion of the 160th Ordinary General
Meeting of Shareholders.
2. The maximum amount of remuneration for Directors who are Audit & Supervisory
Board Members is ¥166 million per year as resolved at the 160th Ordinary General
Meeting of Shareholders held on June 20, 2019. There were 5 Directors who are Audit& Supervisory Board Members as of the conclusion of the 160th Ordinary General
Meeting of Shareholders.
3. Regarding the amount of stock remuneration for Directors (excluding Directors who
are Audit & Supervisory Committee Members or Outside Directors), the maximum
amount of cash to be contributed by the Company is ¥40 million per year, and the
maximum number of points to be awarded to Directors is 110,000 points per year, as
resolved at the 160th Ordinary General Meeting of Shareholders held on June 20,
2019. There were 5 Directors (excluding Directors who are Audit & Supervisory
Committee Members or Outside Directors) as of the conclusion of the 160th Ordinary
General Meeting of Shareholders.
4. There were 9 Directors (including 4 Outside Directors) as of March 31, 2022. The
difference between the total number of Directors shown in the table above and in (1) isbecause the table above includes remuneration for 9 Directors (including 4 Outside
Directors) who retired at the conclusion of the 162nd Ordinary General Meeting of
Shareholders held on June 22, 2021, as stated in (2).

42

5. The total amount of stock remuneration is the amount of expenses recorded for the
fiscal year under review for the stock remuneration plan that allots shares of theCompany (a stock remuneration plan wherein a trust established by the Company
makes acquisitions using funds contributed by the Company, and shares of theCompany and cash equivalent to the disposal conversion amount of the Company’s
shares are allotted to Directors (excluding Directors who are Audit & Supervisory
Committee Members and Outside Directors) through said trust).
6. The amount of performance-linked remuneration paid is determined with reference tothe consolidated operating income for each fiscal year. If consolidated operating
income is below a certain level, or if a serious compliance breach has occurred, thenno payment is made, or the payment amount is reduced. The reason why consolidated
operating income has been selected as an index is because it is a key indicator in the
Company’s management plan. The trend in operating income for fiscal 2021 and otheryears is presented in 1. (6) Financial Position and Results of Operations.
(6) Outside Officers
1) Significant concurrent positions as business executors at other companies, etc. and therelationship between the Company and such companies, etc.
Director who is an Audit & Supervisory Committee Member Mr. Toshio Kinoshita is
Representative Director of Global Professional Partners. There are no significant transactions
between the Company and Global Professional Partners.
Director who is an Audit & Supervisory Committee Member Ms. Miyuki Matoba is General
Manager of the Intellectual Property and Legal Div. of NITTO KOHKI CO., LTD. There are no
significant transactions between the Company and NITTO KOHKI CO., LTD.
2) Significant concurrent positions as outside officers etc. at other companies, etc. and therelationship between the Company and such companies, etc.
Director who is an Audit & Supervisory Committee Member Mr. Toshio Kinoshita is Outside
Audit & Supervisory Board Member of Panasonic Corporation and Outside Director of TACHI-S
CO., LTD.
He was also Outside Director of GiG Works Inc. until January 2022.
There are no significant transactions between the Company and TACHI-S CO., LTD., or GiG
Works Inc.
The Company has transactions with Panasonic Corporation, but there are no special interest
relationships.
(Note) Panasonic Corporation was renamed Panasonic Holdings Corporation effective April 1, 2022.

3) Relationship with specified related parties such as major customers
Not applicable.
4) Principal activities in the fiscal year ended March 31, 2022
i. Outside Directors[Board of Directors meetings]
The Board of Directors met 13 times in the fiscal year ended March 31, 2022. Director, Mr.
Yoshiyuki Fukuda, attended all 10 meetings of the Board of Directors held after he assumed office as
Director on June 22, 2021 (attendance rate: 100%). Directors who are Audit & Supervisory Members,
Mr. Toshio Kinoshita and Mr. Akio Yamamoto attended all 13 meetings of the Board of Directors(attendance rate: 100%). Director who is an Audit & Supervisory Member, Ms. Miyuki Matoba,
attended all 10 meetings of the Board of Directors held after she assumed office as Director on June22, 2021 (attendance rate: 100%). Mr. Yoshiyuki Fukuda, based on his rich experience and wide views
as a corporate executive and high-level knowledge of corporate finance, actively made necessaryinquiries and recommendations.
In addition, as Directors who are Audit & Supervisory Committee Members, Mr. Toshio
Kinoshita, based on his experience and rich accounting knowledge as a certified public accountant inJapan and the US, Mr. Akio Yamamoto, based on his rich experience and wide views as a corporate
executive and rich international experience serving as a business manager at global companies, and
Ms. Miyuki Matoba, based on her rich experience and expert knowledge as a lawyer, actively madenecessary inquiries and recommendations.
43[Audit & Supervisory Committee]
The Audit & Supervisory Committee met 14 times in the fiscal year ended March 31, 2022. Mr.
Toshio Kinoshita attended all 14 meetings of the Audit & Supervisory Committee (attendance rate:100%). Mr. Akio Yamamoto and Ms. Miyuki Matoba each attended all 10 meetings of the Audit &Supervisory Committee held after they assumed office as Directors who are Audit & Supervisory
Committee Members on June 22, 2021 (attendance rate: 100%). Each member of the Audit &Supervisory Committee worked closely with the Internal Control Dept., etc. to perform efficient andeffective audits of the Company’s divisions and departments, business sites and subsidiaries andreceive briefings on the status of business execution at periodic divisional report meetings. They
reported the results of these activities to the Audit & Supervisory Committee and had necessary
discussions with other Directors who are Audit & Supervisory Committee Members.
Board of Directors
Audit & Supervisory
meetings
Committee
Attendance
Attendance
Attendance
Attendance
rate
rate
Director
10/10
100%
Yoshiyuki Fukuda
Director (Audit &Supervisory
13/13
100%
14/14
100%
Committee Member)
Toshio Kinoshita
Director (Audit &Supervisory
13/13
100%
10/10
100%
Committee Member)
Akio Yamamoto
Director (Audit &Supervisory
10/10
100%
10/10
100%
Committee Member)
Miyuki Matoba
Note: Mr. Akio Yamamoto served as an Outside Director prior to his appointment as an Outside Director who is an
Audit & Supervisory Committee Member on June 22, 2021. His attendance at Board of Directors meetings
represents his total attendance.

445) Summary of Duties Fulfilled by Outside Directors Related to Their Expected Roles
Expected roles
Director
Yoshiyuki Fukuda
Director (Audit &Supervisory
Committee Member)
Toshio Kinoshita
Director (Audit &Supervisory
Committee Member)
Akio Yamamoto

Director (Audit &Supervisory
Committee Member)
Miyuki Matoba

Recommendations and supervision
regarding the Company’s managementin general, based on his rich experienceand wide views as a manager, andexpert knowledge of corporate financeSupervision and audit of theCompany’s management, based on his
experience and rich accounting
knowledge as a certified public
accountant in Japan and the US
Recommendations and supervision
regarding the Company’s management,
based on his rich experience in Japanand overseas and wide views as acorporate executive, and richinternational experience serving as abusiness manager at global companies
Supervision and audit of theCompany’s management, based on her
rich experience and expert knowledge
as a lawyer

45

Summary of duties performed related
to expected roles
Inquiries and recommendations
regarding finance strategy and risk
management for overseas business at
subsidiaries in Japan and overseas
Inquiries and recommendations
regarding the strengthening of risk
management across the entire Group,and profitability and tax systems foroverseas businesses
Inquiries and recommendations
regarding business strategy and risk
management at overseas subsidiaries
and the transformation of the businessportfolio
Inquiries and recommendations
regarding the strengthening ofgovernance systems for overseas
subsidiaries, Group crisis management
systems, and intellectual property
strategy5. Accounting Auditor(1)

Accounting Auditor’s Name
Ernst & Young ShinNihon LLC(2)Accounting Auditor’s Remuneration, etc. for the Fiscal Year Ended March 31, 2022
Amount paid (thousands of yen)
Remuneration, etc. for the Accounting Auditor for the
90,000fiscal year ended March 31, 2022
Monetary or property benefits to be paid by the Company
119,870
and its subsidiaries to the Accounting Auditor
Notes: 1. Under the audit agreement between the Company and its Accounting Auditor,
remuneration for audits based on the Companies Act and that for audits based on the
Financial Instruments and Exchange Act are not strictly distinguished and they cannot
be substantially distinguished. Consequently, the sum of the amounts of these
remunerations is stated as the amount of remuneration, etc. for the Accounting Auditor
for the fiscal year ended March 31, 2022.
2. The Audit & Supervisory Committee of the Company, in observance of the “Practical
Guidelines for Cooperation with Accounting Auditors” published by the Japan Audit& Supervisory Board Members Association, has confirmed the time taken to audit
each audit item compared to audit plans for previous fiscal years and comparisonswith amounts for other companies as disclosed for the fiscal year ended March 31,
2021, and agrees to the fees, etc., of the Accounting Auditor under Article 399, Item 1of the Companies Act.
3. Financial statements (including corresponding statements) of some of the Company’s
significant subsidiaries are audited (subject to regulations of the Companies Act andthe Financial Instruments and Exchange Act; including corresponding laws andregulations overseas) by Certified Public Accountants or Audit Corporations(including persons with qualifications that correspond to these qualifications overseas)other than the Company’s Accounting Auditor.

(3)

Non-audit Services
The Company pays fees to Ernst & Young ShinNihon LLC mainly for confirmation provided inrelation to applications for reduction or exemption under the Japanese renewable energy feed-in-tariff(FIT) scheme.

(4)

Policy for Determination of Dismissal or Non-reappointment of the Accounting Auditor
If the Audit & Supervisory Committee considers that it has become difficult for the Accounting
Auditor to perform its duties appropriately or otherwise considers it necessary, the Audit & Supervisory
Committee will make a resolution for dismissal or non-reappointment of the Accounting Auditor, andwill submit a proposal to the General Meeting of Shareholders.
If it is deemed appropriate to dismiss the Accounting Auditor is deemed, because it falls under any
item of Article 340, Paragraph 1 of the Companies Act, the Audit & Supervisory Committee will
dismiss the Accounting Auditor upon consent of all the Audit & Supervisory Committee Members.

(5)

Disposition of Suspension of Business of the Accounting Auditor during the Past Two Years
Not applicable.

(6)

Outline of the Limited Liability Contracts
Not applicable.

46

Consolidated Financial Statements
Consolidated Balance Sheet(As of March 31, 2022)(Millions of yen)Account item
(Assets)
Current assets
Cash and deposits
Notes and accounts
receivable-trade
Notes and accounts
receivable-trade, andcontract assets
Merchandise andfinished goods
Work in process
Raw materials andsupplies
Other
Allowance for doubtful
accounts

Noncurrent assets
Property, plant andequipment
Buildings
Structures
Machinery andequipment
VehiclesTools, furniture andfixturesLand
Lease assets
Construction in progress
Intangible assets
Software
Goodwill
Right of using patent
Investments and otherassets(Reference)
162nd term
526,035

163rd term

Account item

(Reference)
162nd term
255,998

163rd term

557,646(Liabilities)

265,552

200,726

218,164

155,062

166,679

25,91020,210Current liabilities
Notes and accounts payabletrade40,18850,032

92,816-

Short-term loans payable

41,86740,545-101,026

Commercial paper

8,000

8,000

46,71855,79010,003

12,470

4,617

4,516

Current portion of longterm loans payable
Accounts payable-other

23,31323,53920,37925,352

Income taxes payable

5,431

5,439

10,47911,485

Accrued consumption taxes

453

298

(195)

(218)

Accrued expenses

10,871

13,631

Provision for bonuses
Other

2,718
12,213

2,904
9,817

325,309339,482

Noncurrent liabilities

100,935

98,872

247,834

263,171

Bonds payable

37,00037,00045,71029,08651,30831,27941,3195,161

39,016
5,995

71,91489,005

8,397

8,401

909

1,001

Long-term loans payable
Deferred tax liabilities
Deferred tax liabilities forland revaluation
Net defined benefit liability

5,892

5,074

4,510

4,666

Provision for stock benefits

80

60

63,562

63,494

Other

3,084

3,324

1,929

2,141

(Net assets)

270,036

292,094

30,211
11,392
1,166
7,203
3,022

20,276
10,391
1,111
5,989
3,291

247,596
36,99849,397
168,878(7,677)

261,879
36,99849,397
183,128(7,645)66,081

65,918

Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Accumulated othercomprehensive income

19,852

26,59247

Investment securities

59,56960,552

158

140

1,904

1,447

Deferred tax assets

2,146

1,326

Other

2,420

2,524

Long-term loans
receivable
Long-term prepaid
expenses

Valuation difference on
available-for-salesecurities
Deferred gains or losses onhedges
Revaluation reserve for land
Foreign currency translation
adjustment
Remeasurements of defined
benefit plans

Allowance for doubtful
(118)
(73)
Non-controlling interests
accounts
Total
526,035
557,646
Total(Note) Amounts are rounded down to the nearest million yen.

48

16,143

16,883

(442)

(348)

10,245

10,377(3,004)2,410(3,090)(2,731)

2,588

3,621

526,035

557,646

Consolidated Statement of Income(From April 1, 2021 to March 31, 2022)(Millions of yen)
(Reference)
162nd term
354,391

Account item
Net sales
Cost of sales
Gross profit
Selling, general, and administrative expenses
Operating income

163rd term
384,849

254,196

277,674

100,194

107,175

65,46467,051

34,72940,123Non-operating income
Interest and dividend income

1,405

1,661

Equity in earnings of affiliates

933

876

Other

1,314

3,653

606

3,144

Non-operating expenses
Interest expenses

821

Other

5,418

Ordinary income

924
6,239

5,869

32,143

6,793
36,474Extraordinary income
Loss on sales of investment securities

158

158

100

100

Extraordinary loss
Merger-related expenses

252

-

2,997

-

Costs related to voluntary product recall-

972

Impairment losses-

Loss on litigation

Income before income taxes

3,250

968

29,052

Income taxes-current

7,122

Income taxes-deferred

(129)

1,940
34,633

8,428
6,993

1,240

9,668

Profit22,05924,965

Profit (loss) attributable to non-controlling interests(725)(1,047)

Profit attributable to owners of parent

22,78526,012(Note) Amounts are rounded down to the nearest million yen.

49

Non-consolidated Financial Statements
Non-consolidated Balance Sheet(As of March 31, 2022)

Account item
(Assets)
Current assets
Cash and deposits
Notes receivabletrade
Accounts receivabletrade
Merchandise andfinished goods
Work in progress
Raw materials andsupplies
Prepaid expenses
Short-term loans
receivable
Other
Allowance for
doubtful accounts(Reference)
162nd term
451,002
158,682
14,651163rd term

Account item

465,179
169,399
4,272

4,482

4,535

73,37880,84036,44745,679

3,941

4,176

16,75820,091

1,632

1,655

209

224

7,184

7,937

(5)

(12)

(Liabilities)
Current liabilities
Notes payable-trade
Accounts payabletrade
Short-term loans
payable(Millions of yen)
(Reference)
163rd term
162nd term
228,391
239,387
137,598
148,591
4,138
25,29236,33027,67527,675

8,000

8,000

10,00012,466

21,26021,748

4,726

4,273

Accrued expenses

8,497

11,51024,98823,320

2,173

2,270

847
90,792996
90,79537,00037,00039,442

38,975

5,048

5,657

8,397

8,401

80

60

129

129

695

571

Commercial paper
Current portion of
long-term loans
payableAccounts payableother
Income taxes payable292,319295,780

Deposits received
Provision forbonuses
Other
Noncurrent liabilities

210,767

221,699

Bonds payable

Buildings

38,52643,808Structures

26,791

28,938

Machinery andequipment

55,314

68,868805

892

Tools, furniture andfixtures

3,714

3,763

Land

61,781

61,690

199

206(Net assets)

222,610

225,792

23,633

13,530Shareholders’ equity

197,880

200,314

1,417
826
590

1,298
837
461

Capital stock

36,99836,998

Capital surplus

49,28449,284

Noncurrent assets
Property, plant andequipment

VehiclesLeased assets
Construction inprogress
Intangible assets
SoftwareRight of using patent50

Long-term loans
payableDeferred tax
liabilities
Deferred tax
liabilities for land
revaluation
Provision for stock
benefits
Asset retirement
obligations
Other

Investments andother assets
Investment securities
Stocks of
subsidiaries andaffiliates
Long-term loans
receivable

80,13572,781

Legal capital surplus

49,28449,28433,362

34,152Other capital surplus

0038,25434,807

119,274

121,676

119,274

121,676

3,767

3,749

115,506

117,927(7,677)(7,645)24,73025,477

14,48515,09910,245

10,377451,002465,179

Retained earnings

Other retained
earnings
Reserve forLong-term prepaid
advanced
1,072
1,546
expensesdepreciation of
noncurrent assets
Retained earnings
Prepaid pension cost
685
1,071
brought forward
Other investments
1,616
1,549
Treasury stock
Valuation andAllowance for(47)(1)
translation
doubtful accounts
adjustments
Valuationdifference on
available-for-salesecurities
Revaluation
reserve for land
Total
451,002465,179 Total(Note) Amounts are rounded down to the nearest million yen.
4,717

130

51

Non-consolidated Statement of Income(From April 1, 2021 to March 31, 2022)(Millions of yen)
(Reference)
162nd term
252,492

Account item
Net sales
Cost of sales
Gross profit
Selling, general, and administrative expenses
Operating income

163rd term
299,641

171,437

215,385

81,05484,25552,80050,451

28,25433,803Non-operating income
Interest and dividend income

2,097

Other

1,404

1,869
3,501

987

2,856

Non-operating expenses
Interest expenses

486

Other

4,346

Ordinary income

509
4,832

6,806

26,923

7,316
29,343Extraordinary income
Gain on sales of investment securities

158

Gain on extinguishment of tie-in shares

32,373Extraordinary loss
Loss on valuation of shares of subsidiaries andassociates
Costs related to voluntary product recall

100
32,532

Income before income taxes-

972

59,455

Income taxes-current

6,291

Income taxes-deferred

161

Profit52

6,137
23,305

7,047
6,453
53,002(Note) Amounts are rounded down to the nearest million yen.

100

5,165

-

-

304

7,351
15,953

Transcript of Accounting Auditor’s Audit Report on Consolidated Financial Statements

Independent Auditors’ Report(English Translation)
May 9, 2022
To the Board of Directors
Denka Co., Ltd.
Ernst & Young ShinNihon LLC
Tokyo office
Mineo Kambayashi
Certified Public Accountant
Designated and Engagement Partner
Shigeyuki Honda
Certified Public Accountant
Designated and Engagement Partner
Yasuyuki Kitamura
Certified Public Accountant
Designated and Engagement Partner

OpinionPursuant to Article 444, Paragraph 4 of the Companies Act, we have audited the accompanying
consolidated financial statements, which comprise the consolidated balance sheet, the consolidated statementof income, the consolidated statement of changes in net assets and the notes to the consolidated financial
statements of Denka Co., Ltd. (the “Company”) for the fiscal year from April 1, 2021 through March 31,2022.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects,
the financial position and results of operations of the Denka Group, which consists of the Company and its
consolidated subsidiaries, for the period covered by the consolidated financial statements in conformity withaccounting principles generally accepted in Japan.
Basis for the Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibility under the auditing standards is stated in “Auditor’s Responsibility for the Audit of theConsolidated Financial Statements.” We are independent of the Company and its consolidated subsidiaries inaccordance with the provisions related to professional ethics in Japan, and are fulfilling other ethicalresponsibilities as an auditor. We believe that we have obtained sufficient and appropriate audit evidence toprovide a basis for our audit opinion.
Other Information
Other information refers to the business report and supplementary schedules. Management is responsible forthe preparation and disclosure of other information. The Audit & Supervisory Committee are responsible formonitoring the execution of Directors’ duties related to designing and operating the reporting process for otherinformation.

53

Other information is not included in the scope of our opinion on the consolidated financial statements, andwe express no opinion on it.
Our responsibility with respect to the audit of the consolidated financial statements is to read through otherinformation and, in this process, to consider whether any material differences exist between other informationand the consolidated financial statements or knowledge we have gained through the auditing process; also, toremain alert for any other indications of material error in other information.
We are required to report any matter that we consider constitutes a material error in other information,
based on the work we have undertaken.
We have nothing to report regarding other information.
Responsibilities of Management and the Audit & Supervisory Committee for the Consolidated Financial
Statements
Management is responsible for the preparation and fair presentation of the consolidated financial statementsin accordance with accounting principles generally accepted in Japan, and for designing and operating suchinternal control as management determines is necessary to enable the presentation and fair presentation of theconsolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing whether it isappropriate to prepare the consolidated financial statements in accordance with the premise of a going
concern, and for disclosing matters relating to going concern when it is required to do so in accordance withaccounting principles generally accepted in Japan.
The Audit & Supervisory Committee are responsible for monitoring the execution of Directors’ duties
related to designing and operating the financial reporting process.
Auditor’s Responsibility for the Audit of the Consolidated Financial Statements
Our responsibility is to obtain reasonable assurance about whether the consolidated financial statements as
a whole are free from material misstatement, whether due to fraud or error, and to express an opinion on the
consolidated financial statements from an independent standpoint in an audit report, based on our audit.
Misstatements can occur as a result of fraud or error, and are deemed material if they can be reasonably
expected to, either individually or collectively, influence the decisions of users taken on the basis of theconsolidated financial statements.
We make professional judgment in the audit process in accordance with auditing standards generally
accepted in Japan, and perform the following while maintaining professional skepticism.
・ Identify and assess the risks of material misstatement, whether due to fraud or error. Design andimplement audit procedures to address the risks of material misstatement. The audit procedures shall beselected and applied as determined by the auditor. In addition, sufficient and appropriate audit evidence
shall be obtained to provide a basis for the audit opinion.
・ In making those risk assessments, the auditor considers internal control relevant to the entity’s audit inorder to design audit procedures that are appropriate in the circumstances, although the purpose of theaudit of the consolidated financial statements is not to express an opinion on the effectiveness of theentity’s internal control.
・ Assess the appropriateness of accounting policies adopted by management and the method of theirapplication, as well as the reasonableness of accounting estimates made by management and the adequacyof related notes.
・ Determine whether it is appropriate for management to prepare the consolidated financial statements on
the premise of a going concern and, based on the audit evidence obtained, determine whether there is asignificant uncertainty in regard to events or conditions that may cast significant doubt on the entity’s
ability to continue as a going concern. If there is a significant uncertainty concerning the premise of agoing concern, the auditor is required to call attention to the notes to the consolidated financial statementsin the audit report, or if the notes to the consolidated financial statements pertaining to the significant
uncertainty are inappropriate, issue a modified opinion on the consolidated financial statements. While theconclusions of the auditor are based on the audit evidence obtained up to the date of the audit report,
depending on future events or conditions, an entity may be unable to continue as a going concern.
54

・ Besides assessing whether the presentation of and notes to the consolidated financial statements are inaccordance with accounting principles generally accepted in Japan, assess the presentation, structure, andcontent of the consolidated financial statements including related notes, and whether the consolidated
financial statements fairly present the transactions and accounting events on which they are based.
・ Obtain sufficient and appropriate audit evidence regarding the financial information of the Company andits consolidated subsidiaries in order to express an opinion on the consolidated financial statements. The
auditor is responsible for instructing, supervising, and implementing the audit of the consolidated financial
statements, and is solely responsible for the audit opinion.
The auditor reports to the Audit & Supervisory Committee regarding the scope and timing of
implementation of the planned audit, material audit findings including material weaknesses in internal
control identified in the course of the audit, and other matters required under the auditing standards.
The auditor reports to the Audit & Supervisory Committee regarding the observance of provisions related
to professional ethics in Japan as well as matters that are reasonably considered to have an impact on theauditor’s independence and any safeguards that are in place to reduce or eliminate obstacles.

Interest
Our firm and engagement partners have no interests in the Company or its consolidated subsidiaries
requiring disclosure under the provisions of the Certified Public Accountants Act of Japan.

The above represents a translation, for convenience only, of the original report issued in the Japanese
language.

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Transcript of Accounting Auditor’s Audit Report on Non-consolidated Financial Statements

Independent Auditors’ Report(English Translation)
May 9, 2022
To the Board of Directors
Denka Co., Ltd.
Ernst & Young ShinNihon LLC
Tokyo office
Mineo Kambayashi
Certified Public Accountant
Designated and Engagement Partner
Shigeyuki Honda
Certified Public Accountant
Designated and Engagement Partner
Yasuyuki Kitamura
Certified Public Accountant
Designated and Engagement Partner

OpinionPursuant to Article 436, Paragraph 2, Item 1 of the Companies Act, we have audited the accompanying
financial statements, which comprise the balance sheet, the statement of income, the statement of changes in
net assets and the related notes, and the accompanying supplementary schedules of Denka Co., Ltd. (the“Company”) for the 163rd fiscal year from April 1, 2021 through March 31, 2022.
In our opinion, the financial statements and the accompanying supplementary schedules referred to above
present fairly, in all material respects, the financial position of the Company as of March 31, 2022, and theresults of its operations for the year then ended in conformity with accounting principles generally accepted inJapan.

Basis for the Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibility under the auditing standards is stated in “Auditor’s Responsibility for the Audit of the Financial
Statements and the Accompanying Supplementary Schedules.” We are independent of the Company inaccordance with the provisions related to professional ethics in Japan, and are fulfilling other ethicalresponsibilities as an auditor. We believe that we have obtained sufficient and appropriate audit evidence toprovide a basis for our audit opinion.
Other Information
Other information refers to the business report and accompanying supplementary schedules. Management is
responsible for the preparation and disclosure of other information. The Audit & Supervisory Committee areresponsible for monitoring the execution of Directors’ duties related to designing and operating the reporting
process for other information.
Other information is not included in the scope of our opinion on the financial statements and accompanying
supplementary schedules, and we express no opinion on it.
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Our responsibility with respect to the audit of the financial statements and accompanying supplementaryschedules is to read through other information and, in this process, to consider whether any material
differences exist between other information and the financial statements and accompanying supplementaryschedules, or knowledge we have gained through the auditing process; also, to remain alert for any otherindications of material error in other information.
We are required to report any matter that we consider constitutes a material error in other information,
based on the work we have undertaken.
We have nothing to report regarding other information.
Responsibilities of Management and the Audit & Supervisory Committee for the Financial Statements and the
Accompanying Supplementary Schedules
Management is responsible for the preparation and fair presentation of the financial statements and theaccompanying supplementary schedules in accordance with accounting principles generally accepted in Japan,
and for designing and operating such internal control as management determines is necessary to enable thepreparation and fair presentation of the financial statements and the accompanying supplementary schedules
that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements and the accompanying supplementary schedules, management is
responsible for assessing whether it is appropriate to prepare the financial statements and the accompanying
supplementary schedules in accordance with the premise of a going concern, and for disclosing mattersrelating to going concern when it is required to do so in accordance with accounting principles generally
accepted in Japan.
The Audit & Supervisory Committee are responsible for monitoring the execution of Directors’ duties
related to designing and operating the financial reporting process.
Auditor’s Responsibility for the Audit of the Financial Statements and the Accompanying Supplementary
Schedules
Our responsibility is to obtain reasonable assurance about whether the financial statements and theaccompanying supplementary schedules as a whole are free from material misstatement, whether due to fraud
or error, and to express an opinion on the financial statements and the accompanying supplementary schedules
from an independent standpoint in an audit report, based on our audit. Misstatements can occur as a result offraud or error, and are deemed material if they can be reasonably expected to, either individually orcollectively, influence the decisions of users taken on the basis of the financial statements and theaccompanying supplementary schedules.
We make professional judgment in the audit process in accordance with auditing standards generally
accepted in Japan, and perform the following while maintaining professional skepticism.
・ Identify and assess the risks of material misstatement, whether due to fraud or error. Design andimplement audit procedures to address the risks of material misstatement. The audit procedures shall beselected and applied as determined by the auditor. In addition, sufficient and appropriate audit evidence
shall be obtained to provide a basis for the audit opinion.
・ In making those risk assessments, the auditor considers internal control relevant to the entity’s audit inorder to design audit procedures that are appropriate in the circumstances, although the purpose of theaudit of the financial statements and the accompanying supplementary schedules is not to express an
opinion on the effectiveness of the entity’s internal control.
・ Assess the appropriateness of accounting policies adopted by management and the method of theirapplication, as well as the reasonableness of accounting estimates made by management and the adequacyof related notes.
・ Determine whether it is appropriate for management to prepare the financial statements and theaccompanying supplementary schedules on the premise of a going concern and, based on the audit
evidence obtained, determine whether there is a significant uncertainty in regard to events or conditions
that may cast significant doubt on the entity’s ability to continue as a going concern. If there is a significant
uncertainty concerning the premise of a going concern, the auditor is required to call attention to the notes
to the financial statements and the accompanying supplementary schedules in the audit report, or if the57

notes to the financial statements and the accompanying supplementary schedules pertaining to thesignificant uncertainty are inappropriate, issue a modified opinion on the financial statements and theaccompanying supplementary schedules. While the conclusions of the auditor are based on the audit
evidence obtained up to the date of the audit report, depending on future events or conditions, an entity
may be unable to continue as a going concern.
・ Besides assessing whether the presentation of and notes to the financial statements and the accompanying
supplementary schedules are in accordance with accounting principles generally accepted in Japan, assess
the presentation, structure, and content of the financial statements and the accompanying supplementaryschedules including related notes, and whether the financial statements and the accompanying
supplementary schedules fairly present the transactions and accounting events on which they are based.
The auditor reports to the Audit & Supervisory Committee regarding the scope and timing of
implementation of the planned audit, material audit findings including material weaknesses in internal
control identified in the course of the audit, and other matters required under the auditing standards.
The auditor reports to the Audit & Supervisory Committee regarding the observance of provisions related
to professional ethics in Japan as well as matters that are reasonably considered to have an impact on theauditor’s independence and any safeguards that are in place to reduce or eliminate obstacles.
Conflicts of Interest
Our firm and engagement partners have no interests in the Company requiring disclosure under theprovisions of the Certified Public Accountants Act of Japan.

The above represents a translation, for convenience only, of the original report issued in the Japanese
language.

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Transcript of the Audit Report by the Audit & Supervisory Committee

Audit Report(English Translation)
The Audit & Supervisory Committee has audited the Directors’ performance of their duties during the163rd term from April 1, 2021 to March 31, 2022, and hereby reports the method and results thereof as
follows:
1. Auditing Method and Details Thereof
The Audit & Supervisory Committee received regular reports from Directors, employees, etc. on thedetails of resolutions of the Board of Directors related to matters listed in Article 399-13, Paragraph 1, item(i), (b) and (c) of the Companies Act and the creation and operational status of systems developed pursuant tosuch resolutions (internal control systems), requested explanations as necessary, and expressed its views, inaddition to conducting audits via the methods below. Some auditing activities were carried out through theonline meetings system, etc. as a COVID-19 countermeasure, and activities were largely implemented inaccordance with the original audit plan.
1) Audit & Supervisory Committee Members conformed with the Audit & Supervisory Committee Audit
Standards set forth by the Audit & Supervisory Committee and, in accordance with audit policies, theassignment of duties, etc., worked with the Internal Control Department and other internal control
departments to attend meetings of important committees, receive reports on matters related to the
execution of duties from Directors, employees, etc., requested explanations as necessary, reviewed
important approval documents, etc., and investigated the status of operations and assets at head office
and important business sites. In addition, with regard to subsidiaries, Audit & Supervisory Committee
Members took steps to communicate and exchange information with the Directors, Audit &Supervisory Board Members, etc. of subsidiaries, and received business reports from subsidiaries asnecessary.
2) With respect to the basic policy set forth in Article 118, Item 3 (i) of the Ordinance for Enforcement of
the Companies Act and the measures set forth in Item 3 (ii) of the said article, which are described in
the Business Report, the Audit & Supervisory Committee examined the content based on the status of
deliberations at meetings of the Board of Directors and other meetings.
3) The Audit & Supervisory Committee monitored and verified whether the Accounting Auditor
maintained its independence and implemented appropriate audits, received reports from the Accounting
Auditor regarding the status of the performance of its duties, and requested explanations as necessary.
In addition, the Audit & Supervisory Committee received notice from the Accounting Auditor that the“system for ensuring that duties are performed properly” (matters set forth in each item of Article 131of the Ordinance for Corporate Accounting) had been prepared in accordance with the “Quality Control
Standards Relating to Auditing” (issued by the Business Accounting Council on October 28, 2005) andother relevant standards, and requested explanations as necessary.
Based on the above method, the Audit & Supervisory Committee reviewed the non-consolidated financial
statements (non-consolidated balance sheet, non-consolidated statement of income, non-consolidated
statement of changes in net assets, and notes to non-consolidated financial statements) and the accompanying
supplementary schedules, as well as the consolidated financial statements (consolidated balance sheet,consolidated statement of income, consolidated statement of changes in net assets, and notes to consolidated
financial statements), and the business report and its accompanying supplementary schedules for the fiscal
year in question.
2. Results of Audit(1) Results of Audit of Business Report, etc., and Other Relevant Documents
1) In our opinion, the Business Report and the accompanying supplementary schedules present fairly
the conditions of the Company in conformity with the applicable laws and regulations and the
Articles of Incorporation of the Company.
2) We have found no instances of misconduct or material violation of the applicable laws andregulations or the Articles of Incorporation with respect to performance of duties by the Directors.
593) In our opinion, the contents of the resolutions of the Board of Directors related to the internal
control systems are fair and reasonable. In addition, we have found no matters requiring special
mention regarding the description in the Business Report and the performance of duties by the
Directors related to such internal control systems.
4) We have found no matters requiring special mention with respect to the basic policies andinitiatives regarding the determination of policies on control of the finances and business of theCompany described in the Business Report.
(2) Results of Audit of Non-consolidated Financial Statements and the Accompanying Supplementary
Schedules
In our opinion, the method and the results of the audit performed by Ernst & Young ShinNihon
LLC are fair and reasonable.
(3) Results of Audit of Consolidated Financial Statements
In our opinion, the method and the results of the audit performed by Ernst & Young ShinNihon
LLC are fair and reasonable.
May 9, 2022
Audit & Supervisory Committee, Denka Co., Ltd.
Audit & Supervisory Committee Member
Audit & Supervisory Committee Member
Audit & Supervisory Committee Member
Audit & Supervisory Committee Member(Note)

Masaharu Suzuki
Toshio Kinoshita
Akio Yamamoto
Miyuki Matoba

Audit & Supervisory Committee Members Toshio Kinoshita, Akio Yamamoto, and Miyuki
Matoba are Outside Directors as stipulated in Article 2, Item 15 and Article 331, Section 6 of
the Companies Act.

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