Corporate Governance Report
CORPORATE GOVERNANCE

TAMURA CORPORATION

Last Update:July, 10, 2023

Tamura Corporation
Masahiro Asada, Representative Director, President& CEO
Contact: Corporate Governance +81-3-3978-2100
6768
Securities code:
https://www.tamuracorp.com
Notice: This is a translation of the original Japanese document only for reference purposes. In the event of any
discrepancy between this translation and the original Japanese document, the latter shall prevail.
The corporate governance of Tamura Corporation is described below.

I.

Basic Views on Corporate Governance, Capital Structure, Corporate Attributes, and OtherKey Information

1.

Basic Views
The Company and its group companies (collectively, the “Group” or “Tamura Group”) have a basic management philosophy ofrespecting the interests of stakeholders. The management team entrusted with the Group’s management by shareholders thrives
to promote management efficiency and transparency in order to enhance compliance and maximize the Group’s value, based ona strong sense of mission and corporate ethics. The Group’s corporate governance supports the business activities as its
foundation.

Disclosure Based on each Principle of the Corporate Governance Code[Principle 1-4 Strategically held shares](Holding policy)
The electronics industry in which the Group operates has a wide range of participants, from finished product manufacturers to parts
suppliers, and it is essential for it to collaborate directly or indirectly with third parties in development, procurement, production,
distribution, and sales of products. For this reason, the Company holds certain strategic shares from a medium- to long-term
perspective to improve corporate value, comprehensively considering business and alliance strategies. The Board of Directors
regularly verifies the suitability of individual holding, taking into consideration the business strategy of the Group as well as its
business relationship with the issuers of the shares from a medium- to long-term perspective. Should any be determined unsuitablefor holding as a result of such verification, the holding will be reduced or ceased.
(Verification method)
The necessity of particular stock is reviewed in light of the above-mentioned purpose of holding and based on the three criteria:annual transaction value with the issuer; transaction trend for the last three years; and the value of holding against the value oftransaction. The value of transaction is determined on a consolidated basis of an issuer.
(Exercise of voting rights)

1

The voting rights related to strategically held shares shall be exercised for each agenda item, comprehensively considering whether
the holding contributes to the improvement of the medium- to long-term corporate value of the issuer and whether it leads to theimprovement of the medium- to long-term corporate value of the Company. The specific criteria are disclosed on the Group’s
website (Japanese only).
(Criteria for exercising voting rights for strategically held shares: https://www.tamura-ss.co.jp/jp/finance/sustainability.html)[Principle 1-7 Related Party Transactions]
The Company’s transaction involving conflict of interest such as transaction with its Director or Officer or any legal entity controlled
by its Director or Officer, competing transaction or its Director’s or Officer’s concurrently serving as director or officer of anotherlegal entity shall be reviewed and approved by the Board of Directors.

[Supplementary Principle 2-3 (1) Responding to Sustainability Issues]
The Group has defined its long-term vision, “Aspiration for 2050” to become a leading company well-recognized by global
electronics markets to contribute to realizing decarbonized society, based on its corporate philosophy and founding spirit. As thefirst step of realizing the vision, the Group established its 13th Medium-term Management Plan covering the three financial years
from April 2022 to March 2025, which integrates its business strategy and sustainability strategy.
The details of sustainability activities are published on the Group’s website and integrated report named Tamura Report draftedwith reference to the GRI Sustainability Reporting Standards and the ISO 26000 guidance standards.
(Sustainability: https://www.tamuracorp.com/sustainability/index.html)[Supplementary Principle 2-4 (1) Ensuring Diversity]
The Group has focused on talent development with the aim of becoming a "company that people long for" and a "company where
people come." Under the 13th Medium-term Management Plan, which covers the three fiscal years from April 2022 to March 2025,
the Group’s policy is to promote the integration of business and sustainability strategies, and to further focus on human resources
strategy.
The sustainability strategy is being deployed around the eight items of Materiality. One of them is the realization of job satisfaction,
for which the Group is promoting two measures: job satisfaction reform; and ensuring the diversity among managers. It believes
that diversity among people is essential to meet the expectations of global stakeholders. In the 13 th Medium-term Management Plan,
the Group will prioritize improvements in Japan, where diversity is relatively low. It aims to raise the ratio of women, non-Japanese,and mid-career hires among managers of the Company to 10%, 5%, and 50% respectively by the fiscal year ending March 2025.

[Principle 2-6 Function as an asset owner of corporate pension fund]
The Company has established the Tamura Seisakusho Corporate Pension Fund to ensure stable and efficient profit making andfuture pension benefits. The Fund has formulated the Basic Investment Policy and manages pension assets. The decision-making
regarding asset management of the Fund is deliberated by its board of directors and its management committee. A person withappropriate qualifications has been appointed as managing executive director. In addition, the actual management of the Pension
Fund is outsourced to financial institutions which have accepted the Stewardship Code in Japan. The activities of the financial
institutions are reviewed based on their Stewardship Activity Reports. The relevant information is made available on the intranet2

for the members of the Fund.

[Principle 3-1 Enhancement of Information Disclosure](1) a. Management Philosophy
The Group has established its corporate philosophy, consisting of the Mission, Vision, and Guidelines, which are available on its
website. (Mission Vision Guidelines: https://www.tamuracorp.com/corporate/idea/index.html)(1) b. Management Strategy and Management Plan
The Group’s Medium-term Management Plan is available on its website.
(Medium-term Management Plan: https://www.tamuracorp.com/finance/report/financial_results_presentation.html)(2) Basic policy regarding corporate governance
Please refer to 1. Basic Views above.
(3) Policy and procedure for determining remuneration for Directors
Please refer to II. Business Management Organization and Other Corporate Governance Systems regarding Decision-making,Execution of Business, and Oversight in Management below.
(4) Policies and procedures for the selection and dismissal of candidates for Directors
Please refer to 2. Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, and Remuneration
Decisions (Overview of Current Corporate Governance System) of II. Business Management Organization and Other Corporate
Governance Systems regarding Decision-making, Execution of Business, and Oversight in Management below.
(5) Explanation of individual appointment, dismissal, and nomination of candidates for Directors
For the reasons for the appointment of Outside Directors, please refer to 1. Organizational Composition and Operation of II.
Business Management Organization and Other Corporate Governance Systems regarding Decision-making, Execution of Business,
and Oversight in Management below. The biographies of all candidates and the reasons for their appointment are disclosed in thenotice of convocation of the General Meeting of Shareholders each time a candidate is proposed.

[Supplementary Principle 3-1 (3) Disclosure of Sustainability Initiatives]
The Group has integrated its business and sustainability strategies in the 13th Medium-term Management Plan, which covers thethree fiscal years from April 2022 to March 2025. The sustainability strategy is deployed around the eight items of Materiality: (1)sustainable business growth; (2) improvement of product quality; (3) proper supply chain management; (4) compliance; (5)realization of job satisfaction; (6) coexistence with local communities, and (7) realization of global environmental conservation anddecarbonization of the society; and (8) the enhancement of information disclosure. The KPIs for each item and the targets to beachieved by the fiscal year ending March 2025 have been set for each item.
Climate change is identified as one of Materiality items and the Group is promoting initiatives with the targets for FY2025/3: toincrease the sales ratio of Sustainability Contributing Products to 27 percent; and to reduce greenhouse gas emissions (scopes 1 &2) by 33 percent or more compared to FY2014/3.
Although the Group has transitional and physical risks, its core businesses can benefit from expanding market opportunities
associated with climate change. Please refer to the Group’s website (https://www.tamura-ss.co.jp/jp/csr/activity/object.html) for
more information on opportunities and risks related to climate change, prepared with reference to the Task Force on the Climaterelated Financial Disclosure (TCFD) framework (Japanese only). The details of sustainability activities are published on the Group’s

3website and integrated report named Tamura Report drafted with reference to the GRI Sustainability Reporting Standards and theISO 26000 guidance standards.
(Sustainability: https://www.tamuracorp.com/sustainability/index.html)[Supplementary Principle 4-1 (1) Clarification of the role of the Board of Directors and the scope of delegation to management]
The Company has defined the matters to be resolved by the Board of Directors and the matters delegated to the Executive Officers
and thus separated the supervision by the Board and the business execution, in accordance with the Terms of Reference of the Boardof Directors, Authority and Duties Rules and other relevant internal rules. The outline is disclosed on the Group’s website and in
this Corporate Governance Report.
The Board of Directors decides on the matters stipulated by laws and regulations and the Articles of Incorporation, as well as otherimportant matters of the Group.
The Executive Committee, as the highest decision-making body within the authority delegated by the Board, makes decisions or
receives reports on important matters of the Group, including those to be reported or decided by the Board of Directors. The
Executive Officers are responsible for carrying out their duties in their respective areas of responsibility based on the policies
decided by the Board of Directors.
(The Group’s corporate governance structure: https://www.tamuracorp.com/sustainability/governance/index.html)[Principle 4-8 Effective utilization of Independent Outside Directors]
The Company has appointed four Independent Outside Directors, accounting for more than one third of the Board of Directors.
Independent Outside Directors are actively participating in the discussions of the Board of Directors, providing independent andneutral viewpoints based on their abundant experience and expert knowledge, and contributing to the enhancement of corporate
value.

[Principle 4-9 Independence Criteria and Qualities for Independent Outside Directors]
The Group has established its own Independence Criteria for Directors, available on its website. The Group shall select suchcandidates of Directors who meet the Criteria in addition to those set by the Companies Act and the Tokyo Stock Exchange.
(Independence

Criteria

for

Directors

and

Audit

and

Supervisory

Board

Members:

https://www.tamura-ss.co.jp/jp/sustainability/governance.html) (Japanese only)[Supplementary Principle 4-10 (1) Utilization of Committees]
The Company has established the Nomination and Remuneration Advisory Committee as an advisory body to the Board of Directors
in order to make fair and transparent decisions regarding the nomination and remuneration of Directors and Officers. The
Committee, which is chaired by the Lead Outside Director and consists of the President & CEO and the four Independent Outside
Directors, meets several times a year. For details, please refer to 2. Matters Concerning Functions of Business Execution, Auditing
and Supervision, Nomination, and Remuneration Decisions (Overview of Current Corporate Governance System) of II. Business
Management Organization and Other Corporate Governance Systems regarding Decision-making, Execution of Business, andOversight in Management below.

4[Supplementary Principle 4-11 (1) Approach to the balance of knowledge, experience and capabilities among Directors, as well as
the diversity in and size of the Board of Directors as a whole]Outside Directors are selected according to the Independence Criteria for Directors. In addition, the Group gives due consideration
to the balance of knowledge and experience among the Directors such as business management, governmental positions and legal
expertise, in order to strengthen competitiveness and promote sound and sustainable growth of its businesses. The Company ensures
Outside Directors include one or more experienced business managers and the Audit & Supervisory Committee one or more persons
with financial and accounting expertise.
For details, please refer to 2. Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, andRemuneration Decisions (Overview of Current Corporate Governance System) of II. Business Management Organization and Other
Corporate Governance Systems regarding Decision-making, Execution of Business, and Oversight in Management as well as theattached Key Experiences and Capabilities of Directors and Auditors (Skill Matrix).

[Supplementary Principle 4-11 (2) Status of concurrent posts of Directors of other listed companies]
There are Outside Directors who also serve as directors and officers of other listed companies. The information regarding the statusof concurrent posts is disclosed in the notice of convocation of the General Meeting of Shareholders, securities report, and thisCorporate Governance Report. None of the Directors who are also Executive Officers holds concurrent posts of other listedcompanies and they can focus solely on their duties as the Company’s Directors and Executive Officers.
One of the two Outside Members of the Audit and Supervisory Board concurrently serves as an outside director and outside
corporate auditor of other listed companies. The Full-time Member of the Audit &Supervisory Committee does not hold any
concurrent position and can focus solely on his duties as the Company’s the Audit & Supervisory Committee Member.
The status of concurrent posts of Outside Directors at other companies is reported annually, including in the notice of convocationof the General Meeting of Shareholders, securities report and this Corporate Governance Report.

[Supplementary Principle 4-11 (3) Analysis and evaluation of the effectiveness of the Board of Directors]
As part of efforts to further improve the operation of the Board of Directors, it evaluates the effectiveness every year and discloses
a summary.
For the fiscal year ended March 2023, the Board of Directors evaluated its effectiveness, including that of the Nomination andRemuneration Advisory Committee. All the Directors and the Audit and Supervisory Board Members anonymously answered asurvey of selective or free response questionnaire prepared by a third party, who also analyzed the results. They were reported to
the Board of Directors at the meeting held on June 23, 2023, and the improvement measures were discussed.
The outline of the effectiveness evaluation of the Board of Directors for the fiscal year ended March 2023 is as follows.
-

The overall evaluations remained positive following previous years’ results, with constructive and proactive opinions provided
by many Directors and the Audit and Supervisory Board Members.

-

It was also confirmed: that the Board of Directors is being operated properly; that the risk management system is effectively
established and supervised; that the Outside Directors and Outside Members of the Audit and Supervisory Board havecontributed to constructive discussions at the Board of Directors; and that the Board of Directors has multifaceted andsufficient examinations and discussions of issues and has supported the decision-making of the executives. Based on theforegoing, the effectiveness of the Board of Directors was established.

5-

It was confirmed that further progress should be made regarding the deliberation time at the Board of Directors, discussions
on the succession plan of top management, and training of Directors and Officers, which had been identified as issues by theprevious year’s effectiveness evaluation. In addition, increased information on shareholder/investor feedback was identified
as another area for improvement.

-

The Group will continue to make efforts to improve the effectiveness of the Board of Directors.

[Supplementary Principle 4-14 (2) Training policy for Directors]
The Directors of the Company strive to acquire, review, and update the knowledge necessary to fulfill their respective roles andresponsibilities. Directors receive in-house training when they are newly appointed. In addition to the information provided at themeetings of Board of Directors, Outside Directors are given opportunities of visiting key Group sites for audit and receives briefings
by the Full-time Member of the Audit & Supervisory Committee regarding the status of the Group’s business and management
issues.

[Principle 5-1 Policy on constructive dialogue with shareholders]
The Group has the Investor Relations Department as the contact for dialogues with investors and shareholders. Further, themanagement briefing for analysts and institutional investors are conducted semiannually, within a few days after the financial results
announcement. The presentation and other information used at the briefings are disclosed at the Tokyo Stock Exchange and on theGroup’s website. The opinions and other feedback from investors and shareholders are regularly reported to the Board of Directors.
(Financial results presentation: https://www.tamuracorp.com/finance/report/financial_results_presentation.html)

6

2. Capital Structure
Foreign Shareholding Ratio

Less than 10%

Status of Major Shareholders
Name or Company Name

Number of Shares

Percentage (%)

Owned
Master Trust Bank of Japan, Ltd. (Trust account)

10,836,700

13.18

Tamura Cooperating Company Stockholding Association

3,560,156

4.33

Custody Bank of Japan (Trust)

3,400,200

4.13

Sumitomo Mitsui Banking Corporation

3,200,466

3.89

Mizuho Bank, Ltd.

1,999,861

2.43

Resona Bank, Limited

1,911,373

2.32

Sumitomo Mitsui Trust Bank, Ltd.

1,412,000

1.71

Tamura Corporation Employee Stockholding Association

1,178,326

1.43

Naoki Tamura

1,146,446

1.39

Sumitomo Life Insurance Company

1,018,100

1.23

Name of Controlling Shareholder, if applicable(excluding Parent Companies)
Name of Parent Company, if applicable

N/A
N/A

Supplementary Explanation

73. Corporate Attributes
Listed Stock Exchange and Market Segment

Prime Market

Fiscal Year-End

MarchBusiness Sector

Electrical Appliances

Number of Employees (Consolidated) as of the Endof the Previous Fiscal YearNet Sales (Consolidated) for the Previous Fiscal Year
Number of Consolidated Subsidiaries as of the Endof the Previous Fiscal Year

4.

1,000 or more
¥100 billion or more but less than ¥1 trillion
10 or more but fewer than 50

Policy on Measures to Protect Minority Shareholders in Conducting Transactions with Controlling
Shareholder
N/A

5. Other Special Circumstances which may have a Material Impact on Corporate Governance
The Company has no parent company or listed subsidiary.

8

II.

Business Management Organization and Other Corporate Governance Systems regarding
Decision-making, Execution of Business, and Oversight1.

Organizational Composition and Operation
Corporate Governance System

Company with Supervisory Committee

Directors
Number of Directors Stipulated in Articles ofIncorporation
Directors' Term of Office Stipulated in Articles ofIncorporation

14

1 yearChairperson of the Board

President

Number of Directors

10Election of Outside Directors

ElectedNumber of Outside Directors

4

Number of Independent Directors

4Outside Directors’ Relationship with the Company (1)Name

Relationship with the Company*

Attributes

a

b

c

d

e

f

g

h

Akira Kubota

From another company△

Haruko Shibumura

Lawyer△Masashi Imamura

From another company△

Akiko Toyoda

From another company

i

j

k

*Categories for “Relationship with the Company”.
(Use “○” when the director presently falls or has recently fallen under the category; “△” when the director fell under the category
in the past; “●” when a close relative of the director presently falls or has recently fallen under the category; and “▲” when a close
relative of the director fell under the category in the past.)
a. Person who executes business for the Company or its subsidiary
b. Person who executes business for a non-executive director of the Company's parent company
c. Person who executes business for a fellow subsidiaryd. Person/entity for which the Company is a major client or a person who executes business for said person/entity
e. Major client of the Company or a person who executes business for said clientf. Consultant, accounting expert, or legal expert who receives large amounts of cash or other assets from the Company in addition
to remuneration as a director/company auditor
g. Major shareholder of the Company (in cases where the shareholder is a corporation, a person who executes business for the
corporation)h. Person who executes business for a client of the Company (excluding persons categorized as any of d, e, or f above) (applies
to director him/herself only)
i. Person who executes business for another company that holds cross-directorships/cross-auditorships with the Company (applies
to director him/herself only)
j. Person who executes business for an entity receiving donations from the Company (applies to director him/herself only)
k. Other9Outside Directors’ Relationship with the Company (2)

Name
Akira

MembershipofSupervisory
Committee

Designationas
Independent
Director

Supplementary Explanation of
the Relationship

Reasons for Appointment〇〇

Akira Kubota was Managing

Akira Kubota has a wide range of

Executive Officer of Olympus

experience in government agencies, as

Corporation until March 2017.

well as experience and insight in businessAlthough there is a business

management, including research andtransaction relationship between

development, at a major global company.

the Company and Olympus, theSince 2018, he has contributed toamount of transactions in thestrengthening the functioning of thepast three fiscal years has been

Board of Directors from his independent

less than 1% of the consolidated

position as a Director and Nomination andsales of both companies, which

Remuneration

is not material in their amount

Member of the Company. He is expected

and nature to create a special

to contribute to the Board's decision-

conflict of interest.

making and strengthening its audit andKubotaAdvisory

Committee

oversight functions.
Based on the circumstances described on
the left, the Company has determined that
there is no risk of conflicts of interest withgeneral shareholders and has appointed
him as an independent director.
HarukoShibumura〇〇As a lawyer, Haruko Shibumura

As a lawyer, Haruko Shibumura has aprovided legal advice to thehigh level of insight into corporate legal

Companyheraffairs in general, including corporate

appointment as Director in June

governance and risk management, as well2018, but has not received

as extensive experience as an outside

payment other than Director’s

director. Since 2018, she has contributed

remuneration from the Company

to strengthening the governance of thesince her appointment.

Company from her independent position

prior

to

as a Director and Nomination andRemuneration

Advisory

Committee

Member of the Company. She is expected
to contribute to the Board's decisionmaking and strengthening its audit andoversight functions.
Based on the circumstances described on

10the left, the Company has determined that
there is no risk of a conflict of interest
withgeneralshareholders

and

has

appointed her as an independent director.
Masashi〇〇ImamuraMasashiImamurawas

Masashi Imamura has held important

Executive Officer and EVP of

positions in a major global electronics

Sony Corporation, current Sonymanufacturer in Japan and in theGroup Corporation, until June

restaurant industry, and has extensive

2018.

business experience in areas such as

Although there is a business

manufacturing, logistics, procurement,

transaction relationship between

and quality, as well as knowledge of

the Company and Sony Group,

corporate

the amount of transactions in the

independent position, he is expected topast three fiscal years has been

contribute to the Board's decision-making

less than 1% of the consolidated

and strengthening its audit and oversightsales of both companies, whichfunctions.

is not material in their amount

Based on the circumstances described on

and nature to create a special

the left, the Company has determined thatconflict of interest.

there is no risk of conflicts of interest with

In addition, he was Managing

general shareholders and has appointed

Director of Zensho Holdings

him as an independent director.

management.

From

his

Co., Ltd. until June 2019, but
there

are

transactionsnobusiness

betweentheCompany and Zensho.
Akiko
Toyoda〇〇Akiko Toyoda works for PwC

Akiko Toyoda has been engaged in cross-

Advisory LLC.

border and domestic M&A financial

PWC Advisory has not received

advisory services for many years and has

any compensation from theextensive

Company in the past three fiscal

business portfolio strategies, finance andyears.

accounting, taxation and legal affairs. She

knowledgeofcorporateis expected to contribute to the Board's
decision-making, audit and oversightfunctions from an independent standpoint.
Based on the circumstances described on
the left, the Company has determined that
there is no risk of a conflict of interest
with

11

generalshareholders

and

has

appointed her as an independent director.

Supervisory Committee
Composition of Supervisory Committee and Attributes of the Chairperson
All Committee
Members
Supervisory
Committee

Full-time Members
5

Appointment of Directors and/or Staff to Support theSupervisory Committee

Inside Directors

1

Outside Directors
1

4Committee Chair
Inside Director

Not Appointed

Matters Concerning Independence of Said Directors and/or Staff from Executive Officers/Reasons for Adopting Current
SystemThe reason for adopting the Company with Audit & Supervisory Committee system, where the Committee Members responsible
for auditing the execution of duties by the Directors are also the Directors of the Board, is to strengthen the supervisory andmonitoring function of the Board of Directors and to further enhance the Company’s corporate governance.

Cooperation among the Supervisory Committee, Accounting Auditors and Internal Audit Department
Ernst & Young ShinNihon Audit Corporation (currently Ernst & Young ShinNihon LLC) was appointed as the Company’s
accounting auditor at the General Meeting of Shareholders held on June 28, 2007.
The Audit & Supervisory Committee holds meetings with regarding audit plans and other relevant matters, receive reports andexplanations from regarding quarterly accounting audits, and conduct audits in cooperation with, the accounting auditor. Afterthe first quarter review, the Committee exchanges opinions with the accounting auditor on possible candidates and the reasonsfor their selection of Key Audit Matters (KAM).
The Committee communicates with the Internal Audit Department to discuss the annual audit plan and receive reports andexplanations as necessary regarding matters related to internal control. The Audit & Supervisory Committee Members may
accompany internal audits as necessary to check the business and financial conditions as well as compliance and othermanagement matters the Tamura Group's major business locations.

12Voluntary Established Committee(s)Voluntary Establishment of Committee(s) equivalent toEstablished

Nomination Committee or Remuneration Committee

Status of Voluntarily Established Committee(s), Attributes of Members Constituting the Committee and the Committee
Chairperson
Committee’s
Name
Voluntarily
Established
Committee
Equivalent toNomination
Committee

Nomination andVoluntarily
Established
Committee
Equivalent toRemuneration
Committee

Nomination andRemuneration
AdvisoryAll
Members

Full-timeMembers

InsideDirectors

OutsideDirectors

OutsideExperts

Other

Chairperson

1

1

4

0

0

Outside Director

5Committee

Remuneration
Advisory

5

1

1

4

0

0

Outside Director

Committee

Supplementary Explanation
The Nomination and Remuneration Advisory Committee meets several times a year.
-

Purpose/Authority: It deliberate fairly and transparently regarding nominations for Directors and Executive Officers, andregarding remuneration for Directors (excluding the Audit & Supervisory Committee Members), Executive Officers,
Advisors, and report to the Board of Directors. .

-Chair: Akira Kubota, Lead Independent Outside Director-

Members: Five including, Masahiro Asada, President & CEO, and the four Independent Outside Directors, Akira Kubota,
Haruko Shibumura, Masashi Imamura and Akiko Toyoda

Matters Concerning Independent Directors
Number of Independent Directors

4

Other Matters Concerning Independent Directors
All persons who meet the Independence Criteria are designated as Independent Directors.

13Incentives
Implementation Status of Measures related toIncentives Granted to Directors

Introduction of Performance-linked Remuneration Scheme / Introductionof Stock Options Scheme / Other

Supplementary Explanation for Applicable Items
The Company has introduced a performance-linked remuneration scheme and a stock remuneration scheme (excluding the Audit& Supervisory Committee Members). The stock option scheme for Internal Directors was abolished when the stock remuneration
scheme (excluding the Audit & Supervisory Committee Members) was introduced.
[Performance-linked remuneration scheme]
Director’s annual bonuses are calculated according to the performance of the relevant fiscal year in accordance with theprocedures stipulated in the Director Evaluation Rules and Director Remuneration Rules. The key performance indicators ofsales, net income attributable to owners of the parent company, ROE and others have been selected. This performance indicators
are selected from the viewpoint of evaluating profitability and shareholder value improvement.
[Stock remuneration scheme]
The Company has introduced a stock remuneration scheme using a trust, for Directors excluding the Audit & Supervisory
Committee Members.
Under this scheme, a trust ("Trust") established by the Company by contributing money acquires the number of Company's sharesequivalent to the number of points that the Company grants to the relevant Directors and transferred them to such Directors. There
are two types of points granted under this scheme: fixed points granted according to a Director’s position or other qualifications;and performance-linked points granted according to the position and the degree of attainment of performance targets of a Director.
In principle, a Director can receive the shares granted when they retire.

Persons Eligible for Stock Options

Inside Directors / Employees

Supplementary Explanation for Applicable Items
As the stock option scheme was abolished in June 2022, no new stock options will be granted in the future. However, the exerciseof stock options by Directors and Executive Officers who previously held stock options upon retirement will continue until all the
Directors and Executive Officers who currently hold stock options retire.

Director Remuneration
Status of Disclosure of Individual Director’s

No Disclosure for any Directors

Remuneration

Supplementary Explanation for Applicable Items
The total amount of remuneration for Inside Directors and Outside Directors is separately disclosed in the securities report.

14

Policy on Determining Remuneration Amounts andCalculation Methods

Established

Disclosure of Policy on Determining Remuneration Amounts and Calculation Methods
The Company has established a policy for determining the content of individual remuneration for Directors in the Director
Remuneration Rules. In order to ensure fairness and transparency, this policy is first considered by the Nomination andRemuneration Advisory Committee, the majority of which consists of Outside Directors, and chaired by the Lead Outside
Director, before the decision by the Board of Directors.
At the 99th Ordinary General Meeting of Shareholders held on June 28, 2022, the Company introduced a stock compensation
scheme using a trust for the Directors (excluding the Audit & Supervisory Committee Members). With the introduction of thisscheme and the abolition of the stock option scheme, Directors' remuneration consists of monthly compensation, performancebased compensation, and stock compensation.
The monthly remuneration of Directors is defined in the Director Remuneration Rules, and the remuneration ratio for Director isdetermined in a way that contributes to improving annual business performance as well as providing healthy incentives forincreasing corporate value over the medium to long term. A guideline for the ratio of each type of remuneration when targets are
fully achieved is as follows: 64 percent of monthly remuneration, 26 percent of performance-based remuneration, and 10 percent
of stock remuneration. The Audit and Supervisory Committee Members receive only monthly remuneration.
The Nomination and Remuneration Advisory Committee considers the original draft, including consistency with the policy, ofindividual remuneration and the Board of Directors in principle respects its advice.

Support System for Outside Directors
The Representative Director and President meets with Outside Directors from time to time to ensure information sharing andcollaboration.
Although there is no specific department or staff in charge of assisting Outside Directors, the Secretariat of Board of Directors
assists and communicates information to them.

15

Status of Persons who have Retired as Representative Director and President, etc.
Information on Persons Holding Advisory Positions (Sodanyaku, Komon, etc.) after Retiring as Representative Director
and President, etc.
Job title/
position

Name
Naoki

Advisor

TamuraResponsibilities
Providing advice

Terms and Conditions of
Employment(Full/part time, with/without
remuneration, etc.)
Full time with remuneration

Date when former
role as president/
CEO ended
June 28, 2023

upon request by theTerm
2 years inprinciple

Board of Directors or
the management

Number of Persons Holding Advisory Positions (Sodanyaku, Komon, etc.)
After Retiring as Representative Director and President, etc.

1

Other Related Matters
Advisors are appointed by the Board of Directors based on the recommendations of the Nomination and Remuneration Advisory
Committee.

2.

Matters Concerning Functions of Business Execution, Auditing and Supervision, Nomination, andRemuneration Decisions (Overview of Current Corporate Governance System)<Overview of current system>
Overview of meetings and committees
The following is an overview of the key meetings and committees, which carry out functions such as business execution, audit
and supervision, and remuneration determination. The Company has adopted an executive officer system to speed up management
decision-making and contribute to the efficiency of Directors' execution of their duties.
⚫

The Board of Directors➢

Meetings: The regular meetings are held once a month, and extraordinary meetings are held as necessary.

➢

Purpose/Authority: It makes decisions on matters stipulated by law and important management matters, andsupervises the execution of duties by Directors.

⚫

Audit and Supervisory Committee:➢

Meetings: In principle, the regular meetings are held once a month, and extraordinary meetings are held as necessary.

➢

Purpose/Authority: It decides on audit policies, methods of auditing the status of operations and assets, and othermatters related to the execution of duties by the Audit and Supervisory Committee Members, as well as receives
reports on important matters regarding audits and prepare audit reports. In addition, it decides on the selection anddismissal of full-time, elected and specified Members of Audit and Supervisory Committee, as well as the content ofproposals regarding the appointment and dismissal of the accounting auditor to be submitted to the General Meetingof Shareholders. Furthermore, it has the right to consent to the selection and remuneration of Directors who are16

Members of the Audit and Supervisory Committee, and the right to express opinions regarding the selection andremuneration of Directors who are not Members of the Audit and Supervisory Committee.
⚫

Nomination and Remuneration Advisory Committee➢

Meetings: The committee meets several times a year.

➢

Purpose/Authority: It deliberates fairly and transparently regarding nominations for Directors and Executive Officers,
and remuneration for Directors (excluding Audit and Supervisory Committee Members), Executive Officers, andAdvisors, and advises the Board of Directors.

⚫

Sustainability Management Committee➢

Meetings: The committee meets twice a year.

➢

Purpose/Authority: It advises the Board of Directors regarding overall sustainability matters, including complianceand CSR.

⚫

Executive Committee➢

Meetings: Regular meetings are held once a month, and extraordinary meetings are held as necessary.

➢

Purpose/Authority: Within the scope of authority delegated by the Board of Directors, the Executive Committee
receives reports, makes decisions on important matters, or decides to submit matters to the Board of Directors
regarding the execution of important business operations of the Tamura Group.

Committees and meetings at Group Companies
For important subsidiaries, the Company's officers also serve as officers of the subsidiary, and board meetings are held regularly.

Status of audits by corporate auditors(This section describes the status before the transition to a company with an audit and supervisory committee)
In accordance with the audit policy and division of duties established by the Audit and Supervisory Board in accordance with theCompany's Auditor Rules and Audit Standards, all Members of the Audit and Supervisory Committee regularly attend meetingsof the Board of Directors and express their opinions. They also meet with the Representative Director & Chairman, Representative
Director & President and Representative Director, and Outside Directors quarterly.
Full-time Member of the Audit and Supervisory Board regularly attends Business Divisional Management Meetings and attends
board meetings of Group Companies where he concurrently serves as corporate auditor, and also audits financial statements andother documents for companies without accounting auditors. In addition, he receives business reports from directors of Group
Companies, reviews documents such as the records of important decisions and communicate such information on the day-to-day
business at Group Companies to the Outside Members of the Audit and Supervisory Board.

Status of accounting audits
At the General Meeting of shareholders held on June 28, 2007, the Company appointed Ernst & Young ShinNihon Audit
Corporation (currently Ernst & Young ShinNihon LLC) as its accounting auditor.
In fiscal 2022, the certified public accountants who performed the audit work are Mr. Tsuyoshi Hirota (6 years of continuous
auditing) and Mr. Yohei Ikeda (4 years of continuous auditing). In addition, the assistants involved in audit work are comprisedof nine certified public accountants and 22 other people.

17

Policies and procedures for determining remuneration for Directors
Remuneration for Directors (excluding Audit and Supervisory Committee members) is stipulated in the Director Remuneration
Rules, and remuneration the Audit and Supervisory Committee Members is stipulated in the Audit and Supervisory Committee
Member Remuneration Rules. Based on these rules, in order to ensure fairness and transparency, remuneration for Directors(excluding Audit and Supervisory Committee members) is first considered by the Nomination and Remuneration Advisory
Committee, the majority of which consists of Outside Directors, and chaired by the Lead Outside Director, before the decisionby the Board of Directors. Remuneration for the Audit and Supervisory Committee Members is determined through discussions
among the Members including Outside Members.

Policies and procedures for nomination of Director candidates
The Board of Directors shall consist of at least one-third of Outside Directors, and the Company makes best efforts to electpersons who meet the independence criteria set by the Tokyo Stock Exchange as well as the Company. In addition, by adopting
an Executive Officer system and separating executive and supervisory functions, the Company intends to ensure an appropriate
number of Directors at the Board for it to operate properly.
⚫

Candidates for Director (excluding Audit and Supervisory Committee Members)
Taking into account the Company's businesses, scale, management environment and other factors, persons with knowledge,
experience, and qualifications who can contribute to the fulfillment of the functions of the Board of Directors are selected
as Director candidates. The balance and diversity of the entire Board of Directors is also considered in selection.
The Nomination and Remuneration Advisory Committee recommends candidates based on the Director Nomination
Criteria, and the Board of Directors carefully deliberates and makes decisions.

⚫

Director candidates who are Audit and Supervisory Committee Members
Persons who can audit the business execution of Directors (excluding Audit and Supervisory Committee Members) from afair and objective standpoint, taking into consideration the Company's businesses, scale, management environment, audit
system, and other factors, have the qualifications to contribute to improve management soundness and transparency, andhave a wealth of knowledge and experience in business management and operations are selected as candidates for Directors
who are Members of the Audit and Supervisory Committee. The Nomination and Remuneration Advisory Committee
recommends candidates based on the Director Nomination Criteria, and the Board of Directors carefully deliberates andmakes decisions after acquiring the consent of the Audit and Supervisory Committee.

⚫

Appointment/dismissal
The appointment and dismissal of Directors and Executive Officers is carefully deliberated by the Board of Directors basedon the Standards for Appointment and Dismissal of Directors and Officers after receiving advice from the Nomination andCompensation Advisory Committee.

Outline of the liability limitation contract⚫

Non-executive Directors
The Company has entered into a contract to limit liability for damages under Article 423, Paragraph 11 of the Companies
Act based on the provisions of Article 427, Paragraph 1, with Outside Directors, namely, Akira Kubota, Haruko Shibumura,18

Masashi Imamura, and Akiko Toyota, and Director and Audit and Supervisory Committee Member, Yuji Yokoyama. The
maximum amount of liability for damages based on the contract is the amount stipulated by law. The limitation of liability
is permitted only when the relevant person was in good faith and had no gross negligent in performing the duties that caused
the liability.
⚫

Accounting auditor
The Company has entered into a contract to limit liability for damages under Article 423, Paragraph 1 of the Companies
Act based on the provisions of Article 427, Paragraph 1, with its accounting auditory, Ernst & Young ShinNihon LLC. The
maximum amount of liability for damages based on the contract is the amount stipulated by law. The limitation of liability
is permitted only when the auditor was in good faith and had no gross negligent in performing the duties that caused theliability.

3. Reasons for Adoption of Current Corporate Governance System
At the 100th Ordinary General Meeting of Shareholders held on June 28, 2023, The Company transitioned from a company witha audit and supervisory board to a company with an audit and supervisory committee. The reason for adopting the company
system with an audit and supervisory committee is that by having the Audit and Supervisory Committee Members, who areresponsible for auditing the execution of duties by Directors, as members of the Board of Directors, the supervisory andmonitoring function of the Board of Directors can be strengthened and corporate governance can be enhanced. For an overview
of the system, please also refer to the attached Corporate Governance Chart.

19

III.

Implementation of Measures for Shareholders and Other Stakeholders

1. Measures to Vitalize General Meeting of Shareholders and Facilitate Exercise of Voting Rights
Supplementary Explanation
The Company strives to provide information as early as possible by posting
Early Posting of Notice of the General Meetingof Shareholders

convocation notices of the General Meeting of Shareholders on the Tokyo
Stock Exchange and on our website in advance of the dispatch date. The
convocation notice for the Company's 100th term (ending March 2023)
Ordinary General Meeting of Shareholders was sent on June 13, 2023.

Scheduling of the General Meeting of

The meeting was held on June 28, 2023 on a Non-Peak Day.

Shareholders on a Non-Peak Day
The voting rights can be exercised via the Internet as the electronic voting rights
Electronic Exercise of Voting Rights

exercise environment provided by the shareholder registry administrator has
been introduced and the Company has participated in the electronic voting
rights exercise platform operated by ICJ Corporation.

Participation in a Platform for the Electronic

The Company participates in the electronic voting platform operated by ICJ

Exercise of Voting Rights and Other Initiatives

Corporation.

to Enhance Environment for Institutional
Investors to Exercise Voting Rights
Provision of Notice (or Summary of Notice) of

English translation of Summary of Notice is provided.

the General Meeting of Shareholders in English
The Company's 100th Ordinary General Meeting of Shareholders was held on
Wednesday, June 28, 2023, and all of the resolutions listed below wereapproved.
Proposal No. 1: Distribution of surplus capital
Proposal No. 2: Partial amendment to the Articles of Incorporation
Proposal No. 3: Appointment of five Directors (excluding Directors who are
Audit and Supervisory Committee Members)
Other

Proposal No. 4: Election of five Directors who are Audit and Supervisory
Committee Members
Proposal No. 5: Determination of the amount of remuneration for Directors(excluding Directors who are Audit and Supervisory Committee Members)
Proposal No. 6: Determination of the amount of remuneration for Directors
who are Audit and Supervisory Committee Members
Proposal No. 7: Determination of the amount and content of stockcompensation for Directors (excluding directors who are Audit andSupervisory Committee Members)

2.

Status of IR-related Activities
20Supplementary Explanation

Formulation and Publication ofDisclosure Policies

The Disclosure Policy is available on the website.
(Information Disclosure Policy:
https://www.tamuracorp.com/finance/disclosure_policy/index.html#policy)

Regular Investor Briefings held

The Company holds a meeting for analysts and institutional investors semi-

for Analysts and Institutional

annually within a few days after the announcement of Q2 and Q4 financial

Investors

results.
The following information for investors is posted at the website.
(https://www.tamuracorp.com/finance/):-

OnlineDisclosure

Explanation bya representative
director or arepresentative
executive
officerofIR

Information

Financial results summary (tanshin) (including quarterly

information)-

Securities reports (including quarterly reports) (Japanese only)-

Shareholder newsletters (Japanese only)-

Analyst meeting presentations-

Documents related to the General Meetings of Shareholders

Establishment of Department
and/or Placement of a Manager

Corporate Communications Department

in Charge of IR

21

Held

3.

Status of Measures to Ensure Due Respect for Stakeholders
Supplementary Explanation
Establishment of Internal Rules Stipulating

The Group aims to become “One and Only Company” and established its

Respect for the Position of Stakeholders

corporate philosophy consisting of the Mission, Vision and Guidelines.
Furthermore, the specific actions expected for officers and employees,
including respecting stakeholders, are clarified in the Tamura Group Code of
Conduct.

Implementation of Environmental Preservation(1) The Group has a department in charge of Sustainability including

Activities and CSR Activities, etc.

environmental preservation and CSR promotion across the Group. The Group’s
activities are published annually in its integrated report, Tamura Report, and on
its website.
(https://www.tamuracorp.com/sustainability/index.html)(2) The Group has its Procurement Guidelines to request its suppliers topromote Sustainability in the supply chain.
Please refer to the website for the Procurement Guidelines.
(https://www.tamuracorp.com/sustainability/procurement/index.html)

22

IV. Matters Concerning the Internal Control System
1. Basic Views on Internal Control System and Status of Development
The Tamura Group's internal control system aims to stabilize and improve efficiency of management, ensure appropriate
accountability, and comply with laws, regulations, and internal rules. In order to achieve appropriate business management, thefollowing systems, including risk management, compliance, and internal audit processes, have been established.
(1) System for maintaining and managing information related to the execution of duties by the Directors of the Company and asystem for reporting matters related to the execution of duties by directors of Group companies to the Company.
a. Based on the Information Management Rules, the Company and the Group companies maintain and manage information
related to the execution of duties by their directors. Each has established a system equipped with search functions that allows
easy and timely access to information, taking all possible measures to maintain confidentiality according to the storage
medium.
b. Each Group company has established a reporting system in accordance with the Group Company Management Rules andInformation Management Rules to report to the Company regarding matters related to the execution of duties by its directors.

(2) Rules and other systems regarding the management of the risk of incurring losses
In order to manage the risk of incurring losses, the Group has established the Risk Management and Crisis Management Rules
as a system to promptly inform the management of any circumstance that could pose a risk of losses to the Group. The system
has been communicated and rolled out across the Group.
Should there be a serious crisis, a system has been established that the management could take appropriate actions to minimizerisks to the Group, such as by having the President take direct command as the head of the crisis headquarters.

(3) System to ensure efficient execution of duties by Directors at each Group company
a. The Company’s Board of Directors meets regularly once a month and as needed, in order to ensure that the duties of the
Directors are executed efficiently, deciding on important management matters stipulated by law and internal rules, andreceiving reports from the Directors and Executive Officers in charge. At the same time, the Board of Directors supervises theefficient execution of duties by individual Directors.
b. The Company has adopted an Executive Officer system to speed up management decision-making and contribute to theefficiency of the execution of duties by Directors. The Executive Committee within the executive authority delegated by the
Board, makes decisions or receives reports on important matters of the Group, including those to be reported or decided by the
Board of Directors.
c. The Internal Audit Department of the Company conducts audits of each Group company based on the Internal Audit Rules
and reports the results and matters to be improved to the President and the Board of Directors.
e. The board of directors of Group companies meet regularly to determine their basic management policies and supervise theexecution of duties by their directors, as well as the important matters of their subsidiaries, if any.

(4) System to ensure that the execution of duties by directors and employees of each Group company complies with laws andregulations and the articles of incorporation.
a. Based on the Ethics and Legal Compliance Rules established in accordance with the Group's corporate philosophy consisting23

of the Mission, Vision and Guidelines, the Group has a system in place to ensure that all of its directors, officers and employees
shall comply with laws and regulations, social norms and ethics, and each company’s articles of incorporation and internal
rules.
In addition, based on the Sustainability Organization Rules, the Group has established the Sustainability Management
Committee, which shall promote actions related to sustainability, including compliance, as well as build, maintain and improve
an internal control system.
Furthermore, the Group has established a whistleblowing system for Group employees to report or consult regarding illegal or
potentially illegal acts that may occur in the course of business, so that the management could respond in a timely manner inorder to secure the legality of the actions of directors and employees. There are two contacts to choose: an internal contact
operated by a team of employees in the Group; and an independent contact operated by Members of the Audit and Supervisory
Committee, who are not part of the Group's executive team.
b. The Internal Audit Department conducts audit on accounting, business, compliance, information system, and other specificmatters based on the Internal Audit Rules and evaluates the internal control system based on the Internal Control Basic Rules.
c. When a Director finds a serious compliance violation such as those stipulated in the Ethics and Legal Compliance Rules, theyshall immediately report it in accordance with the above-mentioned Alarm Escalation Rules and reported to the Board of
Directors and the Audit and Supervisory Committee.
d. The Audit and Supervisory Committee may request Directors and Executive Officers in charge of relevant areas of
responsibility to formulate improvement measures when they find any problem regarding the operation of the Group's
compliance system.

(5) System to ensure the appropriateness of operations in the Groupa. In order to ensure the appropriateness of operations, the Group has established the corporate philosophy, consisting of theMission, Vision and Guidelines, as well as the Tamura Group Code of Conduct based on them, which apply to and have beencommunicated to all the Group companies.
b. Based on the belief that its suppliers should understand the Group’s corporate philosophy in order to ensure theappropriateness of its operations, the Group has summarized them in the Tamura Group Procurement Guidelines.
c. The Director in charge of each Group company shall report or submit for approval to the Board of Directors of the Company
regarding important matters on a regular or timely basis in accordance with the Group Company Management Rules.
d. The Company ensures the proper performance of business, by allowing its Directors to concurrently serve as directors ofGroup companies, as necessary. At the same time, such concurrent serving of Directors enables them to find and reportimportant compliance issues at a Group company and report them in a timely manner based on the Alarm Escalation Rules andto the Board of Directors and the Audit and Supervisory Board.
e. If a Group company determines that there is a compliance issue in the Company’s control or guidance on such Group
company’s business management, it shall report it in a timely manner based on the Alarm Escalation Rules and to the Board of
Directors and the Audit and Supervisory Committee.
f. The Internal Audit Department of the Company, in cooperation with the Audit and Supervisory Committee, regularly
conducts audits of each Group company.

24

(6) Matters concerning the system regarding employees who should assist the duties of Audit and Supervisory Committee andthe independence of such employees from Directors
a. If the Audit and Supervisory Committee require employees to assist in their duties, the Board of Directors must appoint such
personnel. In order to ensure the independence and neutrality of the duties of such personnel, the selection, dismissal, personnel
changes, wages and other matters regarding them shall not be decided by the Board of Directors without the consent of the
Audit and Supervisory Committee. In addition, the Audit and Supervisory Committee shall independently evaluate such
personnel.
b. Such personnel report only to the Audit and Supervisory Committee regarding their role as supporting the Committee.

(7) The system for reporting to the Audit and Supervisory Committee, including reports by directors, officers and employees ofGroup companies and the system for ensuring effective audits by the Audit and Supervisory Committeea. The Risk Management and Crisis Management Rules have been established that directors and employees of the Group
companies should promptly report such important matters as affect their business or business performance the Audit andSupervisory Committee.
b. The Group makes sure that those who make report to the Audit and Supervisory Committee, or whistleblowers should not betreated unfairly, and such policy has been communicated across the Group.
c. The Company has appointed those who have sufficient knowledge of finance and legal affairs related to corporate activities
as Outside Members of the Audit and Supervisory Committee so that they could carry out appropriate and effective audit incooperation with the Internal Audit Department.
d. Expenses to be incurred in the performance of the duties of Audit and Supervisory Committee are budgeted every fiscal year
and expenses incurred, including both budgeted and unbudgeted, are borne by the Company.

(8) System to ensure the appropriateness of financial reporting
Regarding internal control related to financial reporting, the Company thoroughly collects important information and disclose it
in a timely and appropriate manner in order to ensure compliance with the Financial Instruments and Exchange Act and theother related laws and regulations and the rules of the Tokyo Stock Exchange.
The Company has established necessary information disclosure system, the rules on internal control regarding information andits communications and monitoring and relevant information systems.

(9) Basic Views on Measures for Eliminating Anti-Social Forces and Status of Development
The directors, officers and employees of each Group company shall have no relationship, including business relationship, withany antisocial force.
The Group has declared and specifically and clearly stated in the Tamura Group Code of Conduct that it shall take a resoluteresponse to unreasonable demands from antisocial forces that might threaten the order and safety of citizens' lives, which has
been communicated throughout the Group.

(10) Outline of the status of the system to ensure the appropriateness of businessa. Status of compliance system

25

The Group has established the policy on ethics and legal compliance, defined the Ethics and Legal Compliance Rules andconducting business activities in accordance with them, which are supervised by the Sustainability Management Committee.
The key actions regarding compliance in FY2022/3 were as follows.
・ Identification and mitigation of potential compliance risks
・ Communication of compliance-related educational information to all employees via e-mail newsletters
・ Enhancement of awareness and corporate culture on compliance through training, especially in high-risk areas such ascompetition law and information security
・ Improvement of customs compliance managementb. Status of risk management initiatives
The Group has established internal rules such as the Risk Management and Crisis Management Rules, Whistleblowing Rules,
and Information Management Rules, as well as the above-mentioned Sustainability Management Committee as an organization
to supervise risk management actions.
The main initiatives related to risk management in FY2023/3 were as follows.
・ Reestablishment of the enterprise risk management system
・ Emergency response trainings at the Company and Group companies in Japan・ Compliance training such as information security, occupational safety and harassment prevention
・ Communication of the whistleblowing system such as posters
・ Promotion of Covid-19 countermeasuresc. Status of business execution
The Company has formulated a Medium-term Management Plan to define the common targets for the entire Group, theprogress of which are reviewed by the Board of Directors.
The Company stipulates matters to be resolved by the Board of Directors and matters to be delegated to the Executive Officers
in the Terms of Reference of the Board of Directors, Authority and Duties Rules and other relevant internal rules so that thebusiness of the Group including the duties of directors can be executed efficiently.
The Executive Committee within the executive authority delegated by the Board, makes decisions or receives reports onimportant matters of the Group, including those to be reported or decided by the Board of Directors.
d. Status of system to ensure the appropriateness of Group operations
In order to properly execute the business activities across the Group, it maintains and operates internal control in each Business
Division and each Group company according to the internal control rules such as the Internal Control Rules, Authority andDuties Rules, and Group Company Management Rules. The Group has the Internal Audit Department, which conducts audits of
the appropriateness, legality and rationality of business execution of each Group company based on the annual audit plan andevaluate them to make recommendations for validity and efficiency.
The key initiatives to ensure the appropriateness of business in FY2023/3 were as follows.
・Review of operational status reports of each Business Division at the Business Division Management Committee Meetings
・Review of management status reports of major Group companies at the Business Division Management Committee Meetings
・Review of matters to be reported to the Company from each Group company as stipulated in the Group Company
Management Rules
・Internal audits and internal control evaluations of each Business Division and Group company by Internal Audit Department

26

・Reports of internal audit results and internal control evaluation results to the President
e. Status of initiatives to ensure the effectiveness of audits by Audit and Supervisory Committee
The Company has established and maintains the Terms of Reference of the Audit and Supervisory Committee, the AuditingStandards and other rules so that the effectiveness of the Audit and Supervisory Committee can be maintained and improved.
The key initiatives of the Audit and Supervisory Board Members in FY2023/3, which was before the Company’s transition to a
Company with an Audit and Supervisory Committee, were as follows.
・Prior consent for provision of non-guarantee services in accordance with the revision of the ethical rules of the JapaneseInstitute of Certified Public Accountants
・Attendance at important meetings such as Business Divisional Management Committee and Sustainability Management
Committee meetings
・On-site inspections of business departments and domestic subsidiaries and remote audits of overseas subsidiaries
・Regular meetings to exchange opinions with the Representative Directors, Outside Directors
・Exchanging opinions with the Accounting Auditor regarding such matter as their independence, business execution system,and quality control system
・Consultation with the Accounting Auditor regarding major considerations in accounting audits, receiving reports on theimplementation status of the audit, and requesting explanations as necessary
・Improving audit effectiveness and efficiency through close collaboration with the Internal Audit Department
・Receipt of reports on operation and status of the whistleblowing system from those who are in charge

2. Basic Views on Measures for Eliminating Anti-Social Forces and Status of Development
The directors, officers and employees of each Group company shall have no relationship, including business relationship, withany antisocial force.
The Group has declared and specifically and clearly stated in the Tamura Group Code of Conduct that it shall take a resoluteresponse to unreasonable demands from antisocial forces that might threaten the order and safety of citizens' lives, which has
been communicated throughout the Group.

27

V. Other
1. Adoption of Anti-Takeover Measures
Adoption of Anti-Takeover Measures

Not Adopted

Supplementary Explanation for Applicable Items

2. Other Matters Concerning the Corporate Governance System
Outline of timely disclosure system
The Group aims to contributes to fair price formation and sound development of the equity market, by timely, accurately andfairly providing the Group’s information that are necessary for investors to make appropriate investment decisions.
The Group ensures that material decisions and incidents of the Group are determined by or reported to the Board of Directors,
the Audit and Supervisory Committee and the Executive Committee or other key decision-making bodies. A reporting system isin place so that a sudden material incident can be informed to the top management promptly. Further, an Executive Officer isappointed to be in charge of Information Disclosure, who shall collect, manage, and ensure timely and fair disclosure of corporate
information including financial statements that might have an important influence on investors' investment decisions.
In addition, the information disclosed at the Tokyo Stock Exchange, where the Company is listed, is promptly disclosed on theGroup's website for the convenience of investors.
The Group has established internal rules regarding the prevention of insider trading and strictly managing insider information toensure fair price formation and prevent insider trading.

28

Attachment: Corporate Governance Chart

General Meeting of Shareholders
Appointment/Dismissal

Appointment/Dismissal

Appointment/Dismissal[Supervision]
Nomination andRemuneration
Advisory
Committee

Consul-Cooperation

tationReportAudit

AdviceAudit and

Board ofSupervisory

Directors
Sustainability

Consul-Management

tationEvaluation

Accounting
AuditorCommittee

Committee
AdviceSupervision

Report

Audit

Audit

Report[Execution]

Appointment / Dismissal
President & CEO

Cooperation

Cooperation

Executive Committee
ReportInternal Audit
Business Divisions
Head Office Functions
Group Companies

Audit

29

Attachment: Outline of Timely Disclosure System

Head Office Functions / Business Units / Group Companies
ReportExecutive Committee (for approval)

ReportExecutive Officer in charge of Information Disclosure

Head Office Function in charge ofInformation Disclosure- Collecting information- Judgement based on TSE Rules- Preparation of disclosure documents

Board of Directors (Approval/Report)"Incidents" might be reported after disclosure

Head Office Function in charge of Information DisclosurePriorconsultation

Tokyo Stock Exchange(TDnet)Group website
Media

30

Attachment: Key Experiences and Capabilities of Directors (Skill Matrix)
Corporate
Management

GlobalExperience

Masahiro ASADA
Board Chair / Nomination &Representative Director, President & Remuneration Advisory Committee
CEO
Member✔

✔

Yusaku HASHIGUCHI
Director, Managing Executive Officer
& CFO

✔

✔

Norihiko NANJO
Director, Senior Executive Officer &
COO

✔

✔

Shoichi SAITO
Director, Senior Executive Officer &
CTO

✔

✔

Other posts

Yohei TAMURA
Director, Executive Officer

R&D /Technology

Manufacturin
g / Quality

Lead Independent Outside Director,
Nomination & Remuneration Advisory
Committee Member

Haruko SHIBUMURA
Outside Director, Audit andSupervisory Committee Member

Independent Outside Director,
Nomination & Remuneration Advisory
Committee Member, Lawyer

Masashi IMAMURA
Outside Director, Audit andSupervisory Committee Member

Independent Outside Director,
Nomination & Remuneration Advisory
Committee Member

Akiko TOYODA
Outside Director, Audit andSupervisory Committee Member

Independent Outside Director,
Nomination & Remuneration Advisory
Committee Member✔

✔

Legal / Risk
Management

✔

✔

✔

Finance /Accounting

✔
✔

✔

✔

✔

Akira KUBOTA
Outside Director, Audit andSupervisory Committee Member

Sales /
Marketing

✔
✔
✔

✔

✔

Yuji YOKOYAMA
Director, Audit and Supervisory
Committee Member

END

31

✔

✔

✔

✔

✔

✔

✔

✔