(Translation)

Corporate Governance Report
Last Update: June 21, 2024
Sumitomo Corporation
President and Chief Executive Officer Shingo UENO
Inquiries: Takao NAGAZAWA General Manager,
Corporate Legal & General Affairs Department+81-3-6285-5000
Securities Code: 8053
https://www.sumitomocorp.com/en/jp
The corporate governance of Sumitomo Corporation (the “Company” or “Sumitomo Corporation”) is described
below.
I.

Basic Views on Corporate Governance, Capital Structure, Corporate Profile and Other Basic Information

1. Basic Views
The Company recognizes that the aims of corporate governance are improving management efficiency andmaintaining sound management, while ensuring management transparency is important in order to securethese aims. Accordingly, the Company is endeavoring to establish corporate governance that will result inmanagement serving the interests of shareholders and all other stakeholders. The Company has already taken
steps to strengthen and enhance its corporate governance by such means as reinforcing its audit & supervisoryboard member system and improving the way it functions, optimizing the size of the Board of Directors,
limiting the terms of office of the Chairman and the President and Chief Executive Officer, and introducing
an executive officer system. Additionally, for the purpose of ensuring appropriate decision-making by the
Board of Directors from a variety of perspectives and further strengthening the supervisory function, theCompany appoints multiple Outside Directors, and is working to strengthen the supervisory and monitoring
function of management by independent Outside Directors and Outside Audit & Supervisory Board Members.
In addition, the Company has established the Nomination and Remuneration Advisory Committee (chairedby an outside director), which is an advisory body to the Board of Directors and is composed of a majority ofoutside directors, to enhance the independence, objectivity and transparency of the functions of the Board of
Directors in relation to the nomination and remuneration of senior management. By these means, the Company
believes that it will be able to further achieve the aforementioned corporate governance objectives. The
Company has summarized its basic views and policy with regard to corporate governance as the Sumitomo
Corporation Corporate Governance Principles, which it has made public on its website.
(https://www.sumitomocorp.com/jp/-/media/Files/hq/about/governance/detail/principle.pdf?la=en)[Reasons for Non-compliance with the Principles of the Corporate Governance Code]
The Company complies all Principles of the Corporate Governance Code.
New[Disclosure Based on the Principles of the Corporate Governance Code][Principle 1-3]
The Company, guided by its basic management policy of aiming to continue to enhance corporate value in asustainable way, has a capital policy based on retaining an adequate level of shareholders’ equity with a view-1-

to preservation and reinforcement of its financial soundness and effectiveness of its capital. Additionally, theCompany continues pursuing sustainable profit growth and further strengthening our earnings base to enhanceshareholder returns and increase shareholder value. The shareholder return policy of the Company isdisclosed.
(https://www.sumitomocorp.com/en/jp/ir/stock/information)
The Company keeps interest-bearing debt at an appropriate level by paying attention to the balance between
cash generated as a result of business activities and asset reduction, and cash necessary for returns toshareholders and loans and investments, etc. for the pursuit of growth strategies.
The Company’s basic policy in relation to shareholder returns is to provide shareholders with stable dividends
over the long term. We also aim to raise per-share dividend payments by pursuing the growth of profit in themedium to long term.
[Principle 1-4]
As a general rule, the Company will neither acquire nor hold shares in other listed companies for purposes
other than pure investment.
However, the Company may decide to hold shares in listed companies in some exceptional cases when the
Company determines that it is appropriate. For such determination, the Company will comprehensively assessand verify the capital cost of individual stocks and the economic rationality and significance of holding thestocks in light of the necessity of partnering or other business needs. Each year, the Board of Directors reviews
whether or not the Company’s holding of listed shares is appropriate.
If such annual review concludes that specific shareholdings are of little significance, the Company will pushahead with the sale of the shares.
In FY 2023, the Company sold shares of 18 listed stocks (either in whole or in part), amounting to 20.6 billion
yen in total. As of the end of March 2024, the Company’s shareholdings in listed companies cover 48 stocks,
with the total balance of 272.2 billion yen.
When exercising voting rights, the Company examines various aspects through both quantitative andqualitative approaches in accordance with its own guidelines. Such examination focuses on whether each
proposal presented to shareholders will lead to the enhancement of shareholder value and medium- to longterm corporate value of both the Company and the investee company. In this way, the Company tries to makeadequate decisions as to whether to vote in favor of or against each proposal based on comprehensive
judgments.
If an entity holding shares in the Company for purposes other than pure investment indicates its intention tosell the shares, the Company will, in principle, respect such intention, and the business relationship between
the entity and the Company will not be affected.
[Principle 1-7]
It is stipulated in laws and regulations and in the Company’s internal rules entitled Matters Related to the
Administration of Board of Directors that the approval of the Board of Directors must be obtained to conductbusiness transactions between the Company and its Directors that are competitive or involve conflicts ofinterest, and if such transactions are executed, key facts regarding the transactions must be reported to theBoard of Directors.
[Supplementary Principle 2-4-1][Policies on human resources development to ensure diversity and policies on improvement of diversityoriented working environments, and the progress of implementing these policies]
The Sumitomo Corporation Group recognizes “Diversity, Equity & Inclusion” as “the core enabler forvalue creation, innovation and competitiveness”, and aim to create an environment in which diverse
individuals maximize their potentials and continue to generate new values and innovation without any
bias based on nationality, age, gender, sexual orientation, gender identity or any other individual
attributes and without being restricted by any conventional values. We promote this as an essential
management strategy to have a competitive advantage.
<Specific Examples of Efforts>
Appointments regardless of age, gender, or nationality: A job grade system based on “Pay for Job,
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Pay for Performance”.
Promoting Diversity Awareness: Holding of Diversity Weeks for intensive DE&I programs,
including messages from management, various training sessions, and employee roundtablediscussions.
Promoting Flexible Work Styles: Introduction of teleworking system, super flexible work hours
system, and dress code modification.
Supporting For Balancing Work and Childcare/family care: Providing support system for
employees with overseas assignments to accompany only their children, encouraging men to takechildcare leave, offering childcare consultation services, partnering with childcare facilities,
seminars on caregiving issues, and consultation sessions with family care experts.
Supporting Women's Active Participation: Implementing an internal mentorship program andoffering internal and external management training programs.
Supporting For Senior Employees: Offering career development programs and career design
seminars.
Supporting For Employees with Disabilities: Establishing Sumisho Well Support Co., Ltd., aspecial subsidiary company, to promote the employment, retention, and active participation ofpeople with disabilities by having them handle office work such as data entry and printing. The
number of hires has increased by expanding operations and promoting the subsidiary internally.
Initiatives for LGBTQ+: Applying benefits and HR systems to same-sex partners, allowing theuse of preferred names, and installing universal restrooms for everyone regardless of gender.
Health management: Establishment of in-house clinic, counseling center, and massage room, andpromoting understanding of women’s specific health issues (internal femtech exhibitions where
products can be viewed in person).

Since these efforts were highly acclaimed, the Company has been certified as follows:"Platinum Kurumin" certification by the Ministry of Health, Labor, and Welfare (MHLW) in
recognition of providing superior childcare support among the "Kurumin" certified companies.

A second-highest class "Eruboshi" company in recognition of the effort to promote the active
involvement of female employees on the basis of the Act on Promotion of Women's Participation
and Advancement in the Workplace.
“White 500” enterprise with outstanding health and productivity management for sevenconsecutive years from FY2017 to FY2023.
"The Top Hundred Telework Pioneers" for FY2019 by the Ministry of Internal Affairs andCommunications (MIC).

Telework Promotion Company Award (Kagayaku Telework Award) presented by the MHLW for
FY2020.

"Gold" in "PRIDE INDEX" in recognition of the effort to support sexual minorities including
LGBTQ+ by a general incorporated association "work with Pride" for FY2023.
"Next Nadeshiko: Companies Supporting Dual-career and Co-parenting" for FY2023.
[Stance to ensure diversity in personnel in managerial positions, voluntary and measurable goals, andprogress toward such goals]<Appointment of female employees>
The Company regards encouraging active involvement of women in business as an important pillar of
Diversity, Equity & Inclusion. We are simultaneously promoting intangible initiatives such as reducing
long working hours, encouraging employees to take paid leave, and raising employee awareness, inaddition to tangible initiatives, such as establishing various systems that exceed legal requirements,from the perspective of supporting a balance between life events and career development.
To foster female professionals active in various fields globally on an ongoing basis, the Company has
set the following goals to be achieved in FY 2030 in light of the present circumstances, as stated in therelevant action plan.

Female managers

Current state(April 2024)
9.6%
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Goal
(FY 2030)
20% or more

Female department general
2.4%
10% or moremanager positions
Female Directors and Audit &18.8%
30% or more
Supervisory Board Members**These numerical targets are based on the Company’s support for “Challenge toward 30% by2030” announced by KEIDANREN (Japan Business Federation) in March 2021.
To achieve these goals, we are promoting further enhancement of our recruitment activities, strategic
training and appointments and improved succession planning, all targeted at conscious development
and appointment from medium- to long-term perspectives, as well as creating an environment where
each individual can demonstrate their full potential.
<Appointment of mid-career hires>
The business environment surrounding the Company is changing rapidly. In order to survive thecompetition in the age of tremendous changes, we need to take on the challenge of doing business in
new fields while expanding and advancing our existing businesses. To meet these business needs andbased on business strategies, the Company hires professional mid-career personnel who have great
expertise or knowledge.
The track records of mid-career hires working at the Company cover a wide variety of fields, ranging
from attorneys-at-law, certified public accountants and other licensed or qualified persons, to managers
or engineers from manufacturing, financial, media, information technology or other industries. By
exploiting their skills and expertise developed in their previous careers, such mid-career hires areactive on the front lines of business. Looking at the number of those newly employed (including new
graduates) each year, the ratio of mid-career hires for the most recent business year made up more than
47%. More than 60% of these mid-career hires are assigned to managerial positions just after joining
the Company. As of April 2024, the ratio of mid-career hires in all manager positions at the Company
was about 10% (about 350 persons).
We will continue to strengthen mid-career employment and increase professional personnel in various
business fields.
<Appointment of foreign personnel>
The Sumitomo Corporation Group deploys business operations globally in a wide range of industries.
Such operations are supported by the Group’s global network consisting of 20 offices in Japan and 107
outside Japan, extending to 64 countries and regions throughout the world, with about 8,000 employees
as of April 2024. The latest data shows that the number of locally hired overseas employees inmanagerial positions has reached around 930, up from 820 persons recorded five years earlier. The
ratio of locally hired overseas employees in management positions in the organizations outside Japan ismore than 66%.
In order to promote strategic assignment and appointment in line with the business strategies and to
consistently promote the principle of “the right talent to the right assignments” on a global basis, theSumitomo Corporation Group develops and updates succession plans for the next generation andsubsequent generations. Such succession planning covers key positions in both domestic and overseasorganizations and our group companies, and is aimed at fostering successful talent management acrossthe Sumitomo Corporation Group. For candidates to key positions, we arrange systematic careerdevelopment plans to ensure that they can gain the necessary experience and skills. In this way, we
endeavor to enrich our talent pool in terms of both quality and quantity. As a tool for this purpose, wehave established the Global Mobility Policy (common rules for the Sumitomo Corporation Group
regarding treatment and benefits for employees when relocating overseas) and Job Grading, whichenables us to compare the size of jobs on a global basis. We are also building a human resource
database on a global basis.
Toward the sustainable growth of the Sumitomo Corporation Group, we will continue to actively
appoint talented people to key positions in Japan and overseas, regardless of nationality.

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[Principle 2-6]
The Company has adopted a defined benefit corporate pension plan (contract type).
It also deploys personnel with financial market and investment experience as investment managers andmanages the investment operations of pension assets. When selecting an external asset manager, the Company
sufficiently checks investment management track records and management structures including governancewhile periodically monitoring the conditions of them even after the commencement of investment
management operations.
Furthermore, the Pension Management Committee, which is chaired by the Head of Human Resources andcomprised of managers in charge of human resources, finance and accounting organizations, verifies
investment results and the financial position of pension assets, reports them to the Management Council andalso discloses them to the pension holders.
[Principle 3-1](i) Company objectives (e.g., business principles), business strategies, and management plan
▪ Business Principles
Refer to the Sumitomo Corporation Group Management Principles and Activity Guidelines—as well as
Sumitomo’s Business Philosophy, on which they are based—which the Company makes public on its website(https://www.sumitomocorp.com/en/jp/about/policy/principles).
▪ Medium-Term Management Plan
Additionally, refer to the medium-term management plan, which the Company also makes public on its
website (https://www.sumitomocorp.com/en/jp/about/policy/mid-term).
(ii) Refer to the Sumitomo Corporation Corporate Governance Principles, which summarize the Company’s
basic views and policy with regard to corporate governance, and are made public on the Company’s website.
(https://www.sumitomocorp.com/jp/-/media/Files/hq/about/governance/detail/principle.pdf?la=en)(iii) Refer to the policies and procedures of the Board of Directors for determining the remuneration of
Directors and Executive Officers, which are disclosed in the Company’s annual securities report (yukashoken
houkokusho), and in this corporate governance report in the section entitled “II. Business Management
Organization and Other Corporate Governance Systems regarding Decision-making, Execution of Business,
and Oversight in Management” under “1. Organizational Composition and Operation [Director
Remuneration]” and “2. Matters on Functions of Business Execution, Auditing, Oversight, Nomination andRemuneration Decisions (Overview of Current Corporate Governance System) [Remuneration Decisionmaking Function].”(iv) Refer to the Company’s policies and procedures regarding appointment and dismissal of Directors andAudit & Supervisory Board Members, which are disclosed in this corporate governance report in the section
entitled “II. Business Management Organization and Other Corporate Governance Systems regarding
Decision-making, Execution of Business, and Oversight in Management” under “2. Matters on Functions ofBusiness Execution, Auditing, Oversight, Nomination and Remuneration Decisions (Overview of Current
Corporate Governance System) [Nomination Function, etc.].”(v) Refer to the reasons for nominating candidates for the posts of Outside Director and Outside Audit &Supervisory Board Member, which are disclosed in the reference documents within the Notice of Convocationof the Ordinary General Meeting of Shareholders, and in this corporate governance report in the section
entitled “II. Business Management Organization and Other Corporate Governance Systems regarding
Decision-making, Execution of Business, and Oversight in Management” under “1. Organizational
Composition and Operation [Directors] and [Audit & Supervisory Board Members].” Refer also to the reasonsfor nominating candidates for the posts of internal Director and internal Audit & Supervisory Board Member,which are disclosed in the reference documents within the Notice of Convocation of the Ordinary General
Meeting of Shareholders (https://www.sumitomocorp.com/en/jp/ir/stock/stmt).
Refer to the Company’s policies and procedures regarding the selection and dismissal of Executive Officers,which are disclosed in this corporate governance report in the section entitled “II. Business Management
Organization and Other Corporate Governance Systems regarding Decision-making, Execution of Business,
and Oversight in Management” under “2. Matters on Functions of Business Execution, Auditing, Oversight,
Nomination and Remuneration Decisions (Overview of Current Corporate Governance System) [Nomination
Function, etc.].”[Supplementary Principle 3-1-3]
[Sustainability initiatives]-5-In line with Sumitomo’s Business Philosophy1 and the Sumitomo Corporation Group’s Mission Statement2,
Material Issues were identified in 2017 and the key social issues and specific goals were set in 2020. We
have been undertaking business and corporate activities toward these goals. The Material Issues are now
merged with the key social issues and updated through discussions held with internal and external
stakeholders over the course of approximately one year. The review was conducted from the perspective of
value creation, with consideration also given to the further aggravation of social issues such as climatechange and the loss of biodiversity, the Group’s strengths, and expectations from stakeholders.
Material Issues are medium- to long- term commitment for the Group to take one step further toward
addressing key social challenges that we must undertake. The Group will achieve sustainable growththrough addressing the social challenges. In the revised Material Issues, following six issues are specified:“Build resilient and prosperous society”, “Overcome climate change”, “Preserve and regenerate natural
capital”, “Respect human rights”, “Develop talent and promote DE&I”, and “Maintain and strengthen
governance”.
Climate change is a pressing issue to be undertaken globally. The key to overcoming this issue is to balance
the steady promotion of decarbonization and the stable supply of energy that supports the daily lives ofpeople around the world. The Group aims to achieve carbon neutralization of its businesses by 2050 andsets a medium-term goal of reducing the Group’s CO2 emissions by 50% or more by 2035. Besides working
to reduce the Group’s CO2 emissions from the Group’s businesses toward achieving these goals, the Groupwill further contribute to the acceleration of energy transition toward achieving carbon neutrality in society.
There are various pathways toward achieving a carbon-neutral society depending on countries or regions.
The Group intends to contribute to the greatest extent possible and has therefore revised3 its policies along
the following lines:▪ Previously, a goal for the ratio of the power generation portfolio was set. However, in the gas-fired power
generation business and renewable energy power generation business, the Group will pursue optimal
development of power sources and stable supply of electricity toward achieving the decarbonization andenergy plans of countries and regions without being confined by the ratio of power generation businesses
portfolio.
▪ Regarding fossil fuel upstream business, the timing of terminating thermal coal mining interest previously
stated has been further clarified. As for the remaining upstream gas developments, the Group clarified its
stance, considering the important role natural gas plays in energy transition toward achieving a carbonneutral society.
For each Material Issues, Sumitomo Corporation Group defines medium - and long-term goals andimplements initiatives to achieve sustainable growth through addressing the social challenges4.
Notes 1–2: Sumitomo’s Business Philosophy; Sumitomo Corporation Group’s Management Principles
and Activity Guidelines(https://www.sumitomocorp.com/en/jp/about/policy/principles)
Note 3: Revised Policies on Climate Change Issues(https://www.sumitomocorp.com/-/media/Files/hq/news/release/2024/17610/17610_en.pdf)
Note 4: Material Issues and the long- and medium-term goals(https://sumitomocorp.disclosure.site/en/themes/12)【Disclosure under the TCFD and IBC framework】
Recognizing that climate change is one of the major issues faced by the entire world, the Sumitomo
Corporation Group identifies businesses which may interact significantly with climate change and conducts
scenario analyses based on the recommendations of the Task Force on Climate-related Financial
Disclosures (TCFD).
We analyze the impact of climate change on power generation and next-generation energy, resources,automobiles, aircraft, ships, steel, chemicals, cement, aluminium smelting, real estate, and other businessareas where changes in technology and the introduction of regulations for mitigating the climate change
will have a relatively significant impact on their risks and opportunities related to business environmentchange.
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We assume that there are risks and opportunities in these areas that could affect our business activities.
Through periodic scenario analysis, we recognize their magnitude and consider appropriate
countermeasures to minimize the negative impact on our business performance. We also strengthen ourefforts to contribute to developing business opportunities, such as establishing decarbonized and recyclingoriented energy systems. Specifically, we analyze transition risks and opportunities using APS1, the NZE
scenario2 to limit the temperature increase to within 1.5 degrees Celsius of the pre-industrial revolution
level, and other scenarios. We also analyze the physical risks associated with natural disasters and otherevents caused by climate change. We will continue to expand our disclosures, including additional
information on opportunities.
For details, please refer to the description of TCFD in our website3.
Note 1: Announced Pledges Scenario (APS) assumes that all national governments' climate changecommitments, including Nationally Determined Contributions (NDCs) and long-term net zero targets, will
be fulfilled within the designated period.
Note 2: NZE (Net Zero Emission Scenario) is a scenario back cast from the global net-zero emission goalin 2050.
Note 3: Climate Change - Disclosure Based on TCFD Recommendations(https://sumitomocorp.disclosure.site/en/themes/24）
In January 2021, Sumitomo Corporation showed support for the Stakeholder Capitalism Metrics, which
had been formulated under the initiative of the International Business Council (IBC) of the World Economic
Forum (WEF). The WEF is well known as an organizer of the Davos Forum. Our disclosure information
based on the Stakeholder Capitalism Metrics is found in our website.4
These metrics offer the framework for non-financial disclosure and reporting, comprised of common andcomparable disclosure items that are reportable by enterprises in any industry or in any region. The
disclosure items are presented as non-financial performance indicators covering four themes (Governance,
Planet, People, and Prosperity) and containing 21 core and 34 expanded metrics.
Through the use of these metrics, we intend to enhance disclosure of non-financial information to ourstakeholders. While our present disclosures have not yet covered all of the metrics, we will continue toexamine the significance of the respective metrics for the Company and their benefits for stakeholders, andmay redefine the scope of disclosure.
Note 4: Disclosure based on IBC Stakeholder Capitalism Metrics(https://sumitomocorp.disclosure.site/en/themes/21)【Registration to TNFD Early Adopter and disclosures on natural capital】
Sumitomo Corporation joined the TNFD Forum in 2022, a network of institutional supporters who sharethe vision and mission of the Task Force on Nature-related Financial Disclosures (TNFD)1. Since then, we
have been putting our effort to enhance our disclosure on natural capital including conducting a trial analysis
of our forestry business in New Zealand based on the TNFD’s Beta v0.4 framework and disclosing theresults2 in September 2023. In January 2024, we were registered as an Early Adopter of TNFD3.
In addition, we established the Sumitomo Corporation Group Forest Management Policy and the Sumitomo
Corporation Group Sourcing Policy for Forest Products in April 2022. The Forest Management Policy
clarifies the Group’s environmental and social commitment to sustainable forest management, while theSourcing Policy for Forest Products describes the Group’s policy on procuring forest products incooperation with suppliers and customers4.
Based on one of the Material Issues, “Preserve and regenerate natural capital,” the Group will promote
initiatives to conserve and restore natural capital and expand disclosure.
Note 1: TNFD is the Nature version of TCFD, an organization that defines a corporate disclosure frameworkfor natural capital.
Note 2: Trial analysis of forestry operations in New Zealand-7-

(https://sumitomocorp.disclosure.site/en/themes/27)
Note 3: TNFD Adopter refers to companies or organizations that have been registered on the TNFD
website with their intention to disclose information in accordance with the TNFD Recommendations.
Companies that have been registered by January 10, 2024 were announced as TNFD Early Adopters at theAnnual Meeting of The World Economic Forum in Davos, Switzerland, in the same month.
(https://tnfd.global/engage/inaugural-tnfd-early-adopters/?sf_paged=2)Note 4: Sumitomo Corporation Group Forest Management Policy and Sourcing Policy for Forest Products(https://sumitomocorp.disclosure.site/en/themes/25#144_ManagementPolicy)(https://sumitomocorp.disclosure.site/en/themes/25#144_ForestProducts)【Engagement in social contribution activities】
The Sumitomo Corporation Group works to resolve social issues through its business activities and social
contribution activities, with the aim of contributing to the realization of a sustainable society by fulfillingits Management Principles and Activity Guidelines as a global business group.
Under the “100SEED” social contribution program, we are promoting social contribution activities on a
medium- and long-term basis through the use of our human resources, to encourage employees of theSumitomo Corporation Group to grow sustainably together with society. For details, please refer to thedescription of the activities in our website.
(https://sumitomocorp.disclosure.site/en/themes/36)
[Investment in human capital development]
The Sumitomo Corporation Group recognizes our people as the core enablers of value creation. Each
employee, embracing Sumitomo's business philosophy of "Enterprising Spirit," continuously anticipateschanges and drives the creation and advancement of our businesses. To realize “Enriching lives and theworld,” we aim to create a work environment that unleashes the power of our people, who are the driving
force behind our value creation.
In our current Medium-Term Management Plan 2026, we are focusing on empowering our people andorganizations to further strengthen our strategy execution capabilities. Specifically, we are implementing
various initiatives, including the following: Talent Management: New graduate recruiting that is more reflective of the candidate’s intentions,capabilities identification, and development of management personnel.
 Line Manager Empowerment: Delegating authority over HR matters such as appointments, transfers,
and evaluations, and enhancing people management skills.
 Open/flat communication initiated by leaders: Revamping the entrance ceremony to focus on new
employees and holding roundtable discussions between the president and employees.
 Equal career development opportunities: Implementing a learning platform and expanding internal open
recruitment and concurrent jobs within company.

 [Company’s investment in intellectual property enhancement]
The Company’s investment in business development, which extends over a variety of business fields,
focuses on additional value to be created by such means as business model transformation driven by
innovative technologies or the offering of new product designs. In addition, the Company is underpinned
not only by the competitive superiority brought about by technological innovation and creative designs orcontent, but also by its management base which comprises the Company’s diverse human resources,
multifaceted business expertise accumulated so far, the Company’s global network, trust relationships withclients and business partners, the Company’s brand value in the markets, and all other wealth of capital(intangible assets). The Company’s strategy is to integrate or combine this management base and the diverse
business functions of the business group, aiming to create new businesses and further boost businessgrowth.
In this context, the Company holds the corporate vision of “aiming to be a global organization that
constantly stays a step ahead in dealing with change, creates new value, and contributes broadly to society.”
Under this vision, we are always exploring new business models, know-how and technologies and planting
the seeds for future business development. We believe that in most of those new business models, ourexisting and future intellectual property and intangible assets can contribute toward upholding andstrengthening our high profitability, differentiation from competitors’ products or services, and pricing
power in the markets, which are expected to eventually bring about greater competitiveness and higher-8-

profit margins in the future. Efforts to leverage intellectual property and intangible assets to create new
businesses are being deployed by respective organizations in the business group.
In our Medium-term Management Plan 2026, the Company will pursue growth leveraged by our strengths
and transform our business portfolio by strengthening our people and organization, which are the driving
forces for growth. In order to achieve growth leveraged by our strengths, we will invest capital in businesses
that have strengths and competitive advantages in growth areas to further enhance them. Additionally,
through digital and Green Transformation (GX), we will accelerate the growth of businesses in which wehave a competitive advantage, while nurturing next-generation businesses and acquiring new strengths.
By utilizing digital technology to transform various existing businesses within SC Group, we will enhancethe earning power of the entire Company. In addition, by making maximum use of digital technology andAI, such as by introducing AI technology and using data to speed up and advance decision-making, we willtransform our management base and business operations and develop new strengths.
Furthermore, the Company will utilize the know-how and knowledge we have gained through our efforts
to enhance sustainability management and the establishment of the EII as a company-wide organization tofind new business opportunities in areas such as energy and resource conservation in the short term anddecarbonization and the shift to low-carbon energy sources in the medium to long term, thereby building
our strengths and achieving growth through addressing social challenges.
With a focus on the value obtained from intellectual property and intangible assets in the manner describedabove, our business investment, reinforcement and development will continue based on meticulous analyses
on how such property and assets can lead to competitiveness, differentiation and earning power.
[Supplementary Principle 4-1-1]
The functions of the Board of Directors are to supervise business execution and to make decisions relating toimportant management matters including basic management policies such as business plans. The Board also
makes decisions on important aspects of business execution required by laws and regulations and theCompany’s Articles of Incorporation to be decided by the Board of Directors. Standards for such decisionmaking are stipulated in the Company’s internal rules, Matters Related to the Administration of Board of
Directors.
Decision-making and execution regarding matters not required by the foregoing internal rules to be decided
by the Board of Directors are delegated to the Management Council, the decision-making body at theoperational execution level, and to the Executive Officers. Moreover, the foregoing internal rules specify thatdecisions and progress with execution relating to matters delegated to the Management Council and the
Executive Officers should be reported to the Board of Directors. The Board of Directors uses such reports andrelated information as a means to supervise decision-making and business execution by the Management
Council and the Executive Officers.
[Principle 4-8]
Of the eleven Directors, five are Outside Directors, and they meet the standards set by the Company forindependence of Outside Directors, as well as the standards related to independence set by the financial
instruments exchange that the Company is listed on.
[Principle 4-9]
For details of standards related to the independence of Outside Directors and Outside Audit & Supervisory
Board Members from the Company, refer to the Standards for Appointment and Independence of Outside
Directors and Outside Audit & Supervisory Board Members, which the Company has set down and madepublic on its website.
(https://www.sumitomocorp.com/jp/-/media/Files/hq/about/governance/detail/outdirec_independ.pdf?la=en）[Supplementary Principle 4-10-1]
The Nomination and Remuneration Advisory Committee serves as an advisory board to the Board of
Directors. A majority of committee members shall be Outside Directors, with one of them acting as thecommittee chairperson. This scheme helps to enhance the independence, objectivity and transparency of theBoard of Directors’ function for executive nomination and remuneration.
The Company’s view on the composition and independence of the Nomination and Remuneration Advisory
Committee, the scope of authority and roles assigned to the committee and other related information aredisclosed in the following section in this report (II. Business Management Organization and Other Corporate
Governance Systems regarding Decision-making, Execution of Business, and Oversight in Management >>-9-

1. Organizational Composition and Operation >> Committee’s Name, Composition, and Attributes of
Chairperson >> Supplementary Explanation).
[Supplementary Principle 4-11-1]
 For details of the appropriate balance between knowledge, experience, and skills of the Board of Directors
as a whole, and the Company’s view with regard to the diversity and appropriate size of the Board of
Directors, refer to the Sumitomo Corporation Corporate Governance Principles, which are made public on
the Company’s website.
(https://www.sumitomocorp.com/jp/-/media/Files/hq/about/governance/detail/principle.pdf?la=en)
 Refer to the Company’s policies and procedures regarding appointment of Directors, which are disclosed
in this corporate governance report in the section entitled “II. Business Management Organization and Other
Corporate Governance Systems regarding Decision-making, Execution of Business, and Oversight inManagement” under “2. Matters on Functions of Business Execution, Auditing, Oversight, Nomination andRemuneration Decisions (Overview of Current Corporate Governance System) [Nomination Function,etc.].”
 Refer to the skill matrix posted in the end of this corporate governance report, which indicates the types ofknowledge, experience and competencies, etc. (collectively, “Skills”) that the Board of Directors is required
to possess for fulfilling its roles, and which Directors or Audit & Supervisory Board Members currently in
office possess such Skills.
[Supplementary Principle 4-11-2]
The Company discloses significant positions concurrently held by Directors, Audit & Supervisory Board
Members, and candidates for those posts on an annual basis in disclosure documents such as the reference
documents within the Notice of Convocation of the Ordinary General Meeting of Shareholders, the business
report, and the Company’s annual securities report.
[Supplementary Principle 4-11-3]
Evaluation of the Board of Directors
To maintain and enhance the effectiveness of the Board of Directors, each year Directors and Audit &Supervisory Board Members engage in analysis and evaluation of the Board’s effectiveness throughevaluation and several discussions. This is followed by the disclosure of overviews of the results. The
effectiveness evaluation for fiscal 2023 and the overview of the results is as follows.
1. Evaluation method(1) Target: All members of the Board of Directors (11) and all Audit & Supervisory Board members (5)(2) Implementation method:
In November 2023, we implemented a questionnaire survey (*). Based on the results, Directors and Audit &Supervisory Board members held several discussions to evaluate and analyze the results, and to identify issues
and the initiatives on how we should improve them.
*The questionnaire survey primarily consists of a free-writing format regarding topics that Directors and Audit& Supervisory Board members view as issues. In addition, given the current candid exchange of opinions by
the Board of Directors to grasp the background of respondents’ issue awareness and opinions to deepen
discussions, from fiscal 2022 respondents are asked to fill in their names.
(3) Evaluations items:(i) Functions and roles of the Board of Directors(ii) Composition of the Board of Directors(iii) Agenda items(iv) Quality and content of discussions(v) Provision of support and information(vi) Advisory body to the Board of Directors(vii) Fulfillment of roles of the Board chair(viii) Fulfillment of roles of internal Directors(ix) Fulfillment of roles of Outside Directors(x) Self-evaluation(xi) Expectations in Audit & Supervisory Board members(xii) Comprehensive evaluation(4) Third-party Assistance:- 10 -

We received advice and assistance from a third party (external consultant) mainly to determine the questions
used in this questionnaire.
2. Evaluation Results Overview
All Directors and Audit & Supervisory Board Members held discussions based on the results of thequestionnaire, and evaluated that the Board of Directors is functioning effectively overall, with the level ofoperations and performance of functions improving year by year through constant efforts. The main opinions
are as follows:•
Functions and roles that should be fulfilled by the Board of Directors[Evaluation results] In general, evaluated that the current format which possesses both monitoring andmanagement functions is effectively functioning.
[Issues/initiatives going forward] Opinions were exchanged on each member’s recognition of the rolesof the Company’s Board of Directors, as well as the anticipated roles of Outside Directors and internal
Directors that also concurrently execute duties. As a result of the discussion, the members decided toreconfirm the functions and roles of the Board of Directors, which is the foundation of the Board of
Directors by way of documentation etc. We plan to further strengthen supervisory functions.
•Composition of the Board of Directors[Evaluation results] At present, we evaluated that there are no major issues with the current system.
[Issues/initiatives going forward] With respect to direction going forward, there were various opinions
regarding the diversity and skills of Outside Directors, the composition of Outside/internal Directors,
and institutional design. An ongoing discussion is being carried out on the composition and structure of
the Board of Directors, and based on a review of the structure of management council and businessorganization in April 2024, we have decided to continue considering the future ideal structure of theBoard of Directors.
•
Setting the agenda for the Board of Directors[Evaluation results] In general it was evaluated that we systematically discussed the agenda, and theagenda is being properly set up.
[Issues/initiatives going forward] A proposal was discussed to narrow down the agenda items appropriate
for discussion by the Board of Directors (expanding the scope of delegation for the execution of duties).
With respect to the agenda setting for in and after fiscal 2024, there were opinions, on which discussions
should be focused and concentrated: (1) Focus should be shifted to companywide strategies as opposed
to individual business strategies; and (2) Taking into account the situation the Company is in and theopinions of investors, the focus of discussion should be narrowed down to issues that should beundertaken in particular in the three-year, medium-term management plan, starting from fiscal 2024
(Examples: companywide growth strategy, reshuffling the business portfolio, human resources
training/education, etc.). In fiscal 2024, we decided to set agendas that more effectively carries out
discussions while taking into account these opinions.
•Issues taken up in the results of the effectiveness evaluation conducted in fiscal 2022 as opposed to
the results of initiatives implemented in fiscal 2023
▪ With regard to the issue of taking more time to deepen discussion on medium-and-long-term corporate
strategies, the Board of Directors held a total of four (4) discussions at off-site meetings to discuss theformulation of the next medium-term management plan from the initial stage.
▪ To strengthen the Board of Directorʼs supervisory function, we revised discussion criteria, including
addressing discussions to the Board earlier regarding the implementation of investment or divestment
and financing projects to the point where the Company embarks on full-fledged consideration of a
project, as 35 opposed to the point prior to the conventional implementation of a transaction dependingon the project.
▪ With respect to the enhancement of support and information provision to the Board of Directors, a
dedicated organization, which was newly set up in fiscal 2023 to support communications between the
Board of Directors and individuals executing duties, has started functioning. The evaluation assessedthat improvements have been made to the establishment of discussion points and to brushing up
discussion materials.
In this effectiveness evaluation, we are undertaking further improvement to the effectiveness of the Board of
Directors by taking into consideration the opinions raised by and issues recognized by the Board of Directors
and Audit & Supervisory Board Members.
- 11 -

[Supplementary Principle 4-14-2]
The Company provides its Outside Directors and Outside Audit & Supervisory Board Members withinformation as required in order to deepen their understanding of the Sumitomo Corporation GroupManagement Principles, as well as the Company’s business management, activities, organization, and related
matters. In addition, for its Directors and Audit & Supervisory Board Members, including Outside Directors
and Outside Audit & Supervisory Board Members, the Company provides, arranges, and covers expenses foropportunities to acquire knowledge of its business, finances, organization and other matters necessary forthem to fulfill their roles and responsibilities.
[Principle 5-1]
[Basic policy of dialogue with shareholders]
The Company endeavors to explain its business management and activities, holding a range of meetings asopportunities for communication with shareholders and investors. These include the general meeting ofshareholders, quarterly financial results briefings, and individual meetings.
Dialogue with shareholders and investors is supervised by Executive Officers assigned to act as the persons
responsible for such dialogue, while the relevant departments within the Company liaise to distributeinformation and gather opinions from shareholders and investors.
When conducting dialogue with shareholders and investors, insider information is managed appropriately inaccordance with the internal Rules for the Prevention of Insider Trading.
[Implementation systems and activities]
To achieve its sustainable growth and increase its corporate value over medium- to long-term, the Company
promotes dialogue with stakeholders, including shareholders and investors, which is provided by top
management, including the President and Chief Executive Officer, taking into account the requests and major
concerns of shareholders and investors, in direct communication opportunities.
As an organization to promote dialogue with shareholders and investors, the Company has established a
Corporate Communication Committee chaired by the CSO (*1) and consisting of each Head of Corporate
Group or the person designated by each Head of Corporate Group to ensure the integrity of our external
communications. The committee has also established an IR/SR subcommittee to promote more effective
IR/SR (Shareholder Relations) activities. At its regular meetings, the Corporate Communication Committee
discusses IR/SR activity policies, challenges, and measures to enhance dialogue with shareholders andinvestors. The Company also has a system in place to provide timely feedback to management on external
opinions and requests obtained through IR and SR activities. The Company has also established the Investor
Relations Department., which is dedicated to IR and SR activities. While collaborating with other relevant
corporate departments in a coordinated fashion, it serves as an organization that aims to plan and manage
various IR and SR activities, disclose information to meet expectations of shareholders and investors, andobtain opinions from outside through IR and SR activities to help improve management quality in a timely
manner.
▪ General Meeting of Shareholders
The Company proactively discloses not only information required by law but also information on theenvironmental, social and governance (ESG) and corporate governance initiatives etc. within the Notice ofConvocation of the General Meeting of Shareholders, and strives to provide in-depth explanations in response
to questions from shareholders at the General Meeting. Refer to the details which are disclosed in thiscorporate governance report in the section entitled “III. Implementation of Measures for Shareholders andOther Stakeholders” under “1. Measures to Vitalize the General Shareholder Meetings and Smooth Exerciseof Voting Rights.”▪ Institutional investors (in and outside Japan)
In Japan, quarterly financial results briefings for Japanese institutional investors are conducted by the
President & CEO and the CFO (*2). Business units also hold briefings to report on their businesses regularly.
Semiannual small meetings are conducted by the President & CEO and the CFO.

- 12 -

Meetings with individual institutional investors are vigorously conducted by the President & CEO, the CFO,
and Investor Relations Department. For overseas, we have continued to visit institutional investors, mainly inEurope, North America, and Asia. (A total of seven visits to overseas investors in fiscal 2023.)
Additionally, the Company has held ESG briefings from fiscal 2018. From fiscal 2019, the Company has held
an IR Day (former Investor Day) to have a deep dialogue with institutional investors, aiming to deepen theirunderstanding of the Company’s initiatives for medium- to long-term growth. The Company has held one-onone meetings with managers in charge of exercising voting rights and ESG analysts at institutional investors(SR activities) in and outside Japan, organized jointly by the Investor Relations Department, the Corporate
Sustainability Department, and the Corporate Legal & General Affairs Department).
▪ Individual investors
The Company periodically holds briefings at physical venues in some major cities in Japan and online
briefings on several occasions every year.
To shareholders and investors, the Company discloses not only financial but also non-financial information,
including that related to ESG. By presenting the Group’s medium- to long-term efforts to increase its corporate
value, the Company strives to enhance dialogue with them.
<List of activities in fiscal 2023>
President and CEO: General Meeting of Shareholders, financial results briefings (2 times), IR Day, dialogue
with institutional investors and analysts in and outside Japan (3 times), briefings for individual investors (2times)
CFO: General Meeting of Shareholders, financial results briefings (4 times), dialogue with institutional
investors, analysts, and other stakeholders in and outside Japan (32 times)
CSO: General Meeting of Shareholders, financial results briefings (2 times), IR Day
CAO (*3): General Meeting of Shareholders, IR Day
Investor Relations Department:
Dialogue with institutional investors, analysts, and other stakeholders in and outside Japan. (approx. 250
times, including 29 ESG/SR meetings), IR Day, briefings for individual investors (14 times)(*1) CSO (Chief Strategy Officer)(*2) CFO (Chief Financial Officer)(*3) CAO (Chief Administration Officer)[Action to implement management that is conscious of cost of capital and stock price]
Refer to our website regarding this matter.
(https://www.sumitomocorp.com/en/jp/ir/investors/enhancement)[Status of dialogue with shareholders, etc.]
Refer to the "Q&A" sections of each briefing on our website for the details of the dialogue with investors andanalysts at each session.
(https://www.sumitomocorp.com/en/jp/ir)
Also refer to the "IR/SR Activities" sections of the Integrated Report.
(https://www.sumitomocorp.com/en/jp/ir/financial/investors-guide/2023)
2. Capital Structure
Foreign Shareholding Ratio

More than 30%
New[Status of Major Shareholders]Name / Shareholder Name
The Master Trust Bank of Japan, Ltd. (trust account)
BNYM AS AGT/CLTS 10 PERCENT
Custody Bank of Japan, Ltd. (trust account)
Sumitomo Life Insurance Company- 13 -

Number of Shares Owned
200,965,200
113,294,324
66,522,900
30,855,000

Percentage (%)
16.45
9.27
5.44
2.53

JP Morgan Securities Japan Co., Ltd.
STATE STREET BANK WEST CLIENT - TREATY
505234
JP MORGAN CHASE BANK 385781
Mitsui Sumitomo Insurance Company, Limited
Nippon Life Insurance Company
JP MORGAN CHASE BANK 385632
Controlling Shareholder (except for Parent
Company)
Parent Company
Supplementary Explanation

21,477,571
20,338,064

1.76
1.66

15,036,952
15,000,000
14,879,067
12,290,673

1.23
1.23
1.22
1.01

―
No

New

The shareholding ratio is calculated by dividing the number of shares held by the number of shares
outstanding, which is derived by deducting treasury stock (1,143,723 shares) from the total number of issued
shares, and rounding to the nearest hundredth of a percent.

3. Corporate Attributes
Listed Stock Market and Market Section

Tokyo Prime Market

Fiscal Year-End

MarchType of Business

Wholesale Trade

Number of Employees (consolidated) as of the
End of the Previous Fiscal YearSales (consolidated) as of the End of thePrevious Fiscal Year
Number of Consolidated Subsidiaries as of the
End of the Previous Fiscal Year

More than 1000
More than ¥1 trillion
More than 300

4. Policy on Measures to Protect Minority Shareholders in Conducting Transactions with Controlling
Shareholder―

5. Other Special Circumstances which may have Material Impact on Corporate Governance
1. Views and policies on group management
With business units in the Company and regional organizations in Japan and overseas working together, our
Sumitomo Corporation Group is developing a wide range of business activities in a wide range of industrial
fields globally through Subsidiary and Associated company (collectively hereinafter referred to as "Group
Companies").
The management policy of our Company Group is to respect "autonomous" management by each Group
Company, and to be involved in important decision-making at the board of directors or organization equivalent
to the board of directors of each Group Company based on the relationship of trust established through active"dialogue" as a shareholder, and to create new value through strong "cooperation" of each Group Company
including the Company.
- 14 -

In order to maximize our group's corporate value through sharing and putting into practice the principles ofGroup management, the Company has established a Group Management Policy that sets the three principlesof Group management: “autonomy”, “dialogue”, and “cooperation”.
2. Significance of having a listed subsidiary based on the above views and policies
The Company has a listed subsidiary, SCSK Corporation (Tokyo Stock Exchange Prime Market; hereinafter“SCSK”). In order to increase the corporate value of SCSK as well as of the entire Group including SCSK, it
is considered appropriate for SCSK to remain as a listed company, considering the current competition andmarket environment in the business area of SCSK. More specifically, the benefits of being a listed company
include: enhancing motivation among the officers and employees of SCSK; enhancing corporate credibility
through the establishment and operation of various governance systems, including the transparency ofbusiness management and internal control; increasing the corporate presence; increasing brand strengths in
hiring employees; and establishing a solid financial basis including better financing capability. These benefits
should also lead to the further development of trust with customers and business partners as well as to thehigher credibility of businesses and services conducted by SCSK.
Moreover, it will be beneficial for both the Company and SCSK in terms of increasing corporate value once
these two companies leverage their respective strengths while sharing business strategies, and collaborateclosely in corporate management for the following areas: supporting and enhancing global business execution
through the development and operation of the Group’s IT platforms; and global business creation in such areas
as digital transformation (DX) and open innovation. These initiatives should then lead to the maximization of
corporate value across the Group.
3. Measures to ensure the effectiveness of the governance system at the listed subsidiary
As stated above, the Company respects the autonomous management of Group Companies, and accordingly
entrusts the management of SCSK to the management officers of SCSK. In addition, SCSK effectively
employs the outside directors who are independent of the Company and establishes and operates its effective
corporate governance system to ensure independent decision-making in light of the risk of conflicts of interest
between the parent company and general shareholders of SCSK.
On the other hand, the Company requires prior consultation and reporting by SCSK on matters that could
have a significant impact on SCSK’ s corporate value, such as SCSK’ s execution of important operations andcompliance issues, from the perspective of maintaining and enhancing SCSK’ s corporate value and thenecessity of risk management based on the construction and operation of internal control for the entire Group,
while ensuring that SCSK’ s independent decision-making is secured.

- 15 -

II. Business Management Organization and Other Corporate Governance Systems regarding Decisionmaking, Execution of Business, and Oversight in Management
1. Organizational Composition and Operation
Organization Form

Company with Audit & Supervisory Board[Directors]
Maximum Number of Directors Stipulated in
Articles of Incorporation
Term of Office Stipulated in Articles ofIncorporation

N/A
1 yearNumber of Directors

Chairperson (Excluding individual holding concurrent
position as president)
11

Appointment of Outside Directors

Yes

Number of Outside Directors

5

Number of Independent Directors

5

Chairperson of the Board

Outside Directors’ Relationship with the Company (1)NameAttribute

New

Relationship with the Company*
a

b

c

d

e

f

g

h

i

j

k

Akiko Ide
From another company
Takashi Mitachi
From another company△△
Takahisa Takahara
From another company○
Haruyasu Asakura
From another company
Nana Otsuki
From another company* Categories for “Relationship with the Company”* “○” 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;“▲” when a close relative of the director fell under the category in the pasta. Executive of the Company or its subsidiaries
b. Non-executive director or executive of a parent company of the Company
c. Executive of a fellow subsidiary company of the Company
d. A party whose major client or supplier is the Company or an executive thereof
e. Major client or supplier of the listed company or an executive thereof
f. Consultant, accountant or legal professional who receives a large amount of monetary consideration or otherproperty from the Company besides compensation as a director/audit & supervisory board member
g. Major shareholder of the Company (or an executive of the said major shareholder if the shareholder is alegal entity)
h. Executive of a client or supplier company of the Company (which does not correspond to any of d, e, or f)(the director himself/herself only)
i. Executive of a company, between which and the Company outside directors/audit & supervisory board
members are mutually appointed (the director himself/herself only)- 16 -

j. Executive of a company or organization that receives a donation from the Company (the director
himself/herself only)
k. Others
Outside Directors’ Relationship with the Company (2)Name

Designationas
Independent
Director○

Supplementary
Explanation of
the Relationship

Takashi Mitachi

Reasons of Appointment
Ms. Ide served in several key positions for many
years at a major telecommunications carrier,working as a group company executive and as afull time audit & supervisory board member of theparent (holding) company. Through these andother roles, Ms. Ide has accumulated wideranging knowledge and a wealth of experience ininformation and communications, business
management, and corporate governance, etc.; sheis also honest in character, as well as highly
insightful and capable. Ms. Ide will contribute to
the Company’s aims of ensuring appropriate
decision-making from diverse perspectives inboard meetings and further enhancing supervisory
functions, and is thus judged to be qualified for therole of Outside Director of the Company and to beable to perform her duties properly in that
position. For these reasons, she is appointed as the
position of Outside Director.

Akiko Ide○New

Mr. Mitachi served
until April 2017 asVice Chairman at
KEIZAI DOYUKAI(Japan Association of
Corporate
Executives), to which
the Company pays
membership fees, etc.
and makes donations.
However, the amountof the fees and the
donationsarenegligible – less than
1% of the association’s
total ordinary revenue.
Furthermore,
Mr.
Mitachi engaged until
September 2017 in the- 17 -

Ms. Ide meets the standards set by Sumitomo
Corporation for Independence of Outside
Directors, and also meets the standards related toindependence set by the financial instruments
exchange that the Company is listed on. The
Company has notified the exchange of her status
as an independent director.
Mr. Mitachi served in several key positions formany years at a major US consulting firm.
Through these and other roles, Mr. Mitachi has
accumulated wide-ranging knowledge and awealth of experience in business management andenterprise risk management, etc.; he is also honestin character, as well as highly insightful andcapable. Mr. Mitachi will contribute to theCompany’s aims of ensuring appropriate decisionmaking from diverse perspectives in board
meetings and further enhancing supervisory
functions, and is thus judged to be qualified for therole of Outside Director of the Company and to beable to perform his duties properly in that position.
For these reasons, he is appointed as the positionof Outside Director.
Mr. Mitachi meets the standards set by Sumitomo
Corporation for Independence of Outside○Takahisa
Takahara

executionofoperational duties as
Managing Director &Senior Partner ofBostonConsulting
Group, to which theCompany
pays
outsourcing
fees.
However, the amountis negligible – lessthan 0.01% of the
BostonConsulting
Group’s
worldwide
net sales. We havetherefore determinedthat his independence
is unaffected.
Mr. Takahara engages
in the execution ofoperational duties as
President & CEO of
UNICHARM
CORPORATION. The
Company
and
UNICHARM
CORPORATION
jointly invest in The
Hartz
MountainCorporation, and thisinvestment is based onashareholders’agreement between thetwocompanies.
However, the amountinvestedbytheCompany is negligible– less than 0.1% of its
total
consolidated
assets and less than
0.4% of UNICHARMCORPORATION’s
total
consolidated
assets.
We
havetherefore determinedthat his independence
is unaffected.

○

Directors, and also meets the standards related toindependence set by the financial instruments
exchange that the Company is listed on. The
Company has notified the exchange of his status
as an independent director.

Mr. Takahara has held several key positions formany years at a major consumer goods
manufacturer, serving as Director, SeniorDirector, and President & CEO. Through theseand other roles, Mr. Takahara has accumulated
wide-ranging knowledge and a wealth ofexperience in business management; he is also
honest in character, as well as highly insightful
and capable. Mr. Takahara will contribute to theCompany’s aims of ensuring appropriate decisionmaking from diverse perspectives in board
meetings and further enhancing supervisory
functions, and is thus judged to be qualified for therole of Outside Director of the Company and to beable to perform his duties properly in that position.
For these reasons, he is appointed as the positionof Outside Director.
Mr. Takahara meets the standards set by
Sumitomo Corporation for Independence ofOutside Directors, and also meets the standards
related to independence set by the financial
instruments exchange that the Company is listed
on. The Company has notified the exchange of his
status as an independent director.

Mr. Asakura has held several key positions formany years at private equity fund investmentcompanies and served in executive and outside
director positions for multiple companies.
Through these and other roles, Mr. Asakura has
accumulated wide-ranging knowledge and awealth of experience in M&A and business
management, etc.; he is also honest in character,as well as highly insightful and capable. Mr.
Asakura will contribute to the Company’s aims of
ensuring appropriate decision-making from

Haruyasu
Asakura- 18 -

diverse perspectives in board meetings and further
enhancing supervisory functions, and is thus
judged to be qualified for the role of Outside
Director of the Company and to be able to perform
his duties properly in that position. For thesereasons, he is appointed as the position of Outside
Director.
Mr. Asakura meets the standards set by Sumitomo
Corporation for Independence of Outside
Directors, and also meets the standards related toindependence set by the financial instruments
exchange that the Company is listed on. The
Company has notified the exchange of his status
as an independent director.
Ms. Otsuki has held several key positions formany years at companies including leading
securities firms and has served as a university
professor and in outside director positions forlisted companies. Through these and other roles,
Ms. Otsuki has accumulated wide-ranging
knowledge and a wealth of experience in market
analysis and corporate governance, etc.; she isalso honest in character, as well as highly
insightful and capable. Ms. Otsuki will contributeto the Company’s aims of ensuring appropriate
decision-making from diverse perspectives inboard meetings and further enhancing supervisory
functions, and is thus judged to be qualified for therole of Outside Director of the Company and to beable to perform her duties properly in that
position. For these reasons, she is appointed as the
position of Outside Director.

○

Nana Otsuki

Ms. Otsuki meets the standards set by Sumitomo
Corporation for Independence of Outside
Directors, and also meets the standards related toindependence set by the financial instruments
exchange that the Company is listed on. The
Company has notified the exchange of her status
as an independent director.
Voluntary Establishment of Committee(s)Corresponding to Nomination Committee orRemuneration Committee

Established

Committee’s Name, Composition, and Attributes of Chairperson

All Committee Members

Committee
Corresponding
toNomination Committee
Nomination and Remuneration
Advisory Committee
5Committee
Corresponding
toRemuneration Committee
Nomination and Remuneration
Advisory Committee
5

Full-time Members

00Committee’s Name

- 19 -

Inside Directors

22

Outside Directors

33Outside Experts

0

0

Other

0

0

Chairperson

Outside Director

Outside Director

Supplementary ExplanationNew

The Nomination and Remuneration Advisory Committee is composed of the Chairman of the Board of
Directors, the President and Chief Executive Officer and three outside directors. The Nomination andRemuneration Advisory Committee is in charge of reviewing (1) policies and procedures regarding
appointment and dismissal of the President and Chief Executive Officer, (2) policies and procedures regarding
appointment and dismissal of the Chairman of the Board of Directors, (3) nomination criteria for directors
and audit & supervisory board members, (4) appointment and dismissal of the President and Chief Executive
Officer (including the nomination of a successor of the President and Chief Executive Officer), (5)nominations of candidates for directors and audit & supervisory board members (including determination ofRepresentative Directors and Executive Directors), (6) appointment of Management Council members, (7)the structures/levels of remuneration and bonuses for Directors and Executive Officers and the limit of
remuneration for Audit & Supervisory Board Members, and (8) the advisor system, and will submit the results
thereof as recommendations to the Board of Directors. Additionally, the committee will also deliberate anddetermine any matters delegated by the board of directors that are not included in (1) to (8) mentioned above,and report the outcome of such deliberation or decision to the board of directors. In fiscal 2023, theNomination and Remuneration Advisory Committee met 9 times to deliberate the abovementioned matters,
and submitted the results thereof as recommendations to the Board of Directors. All committee members
except for Ms. Ide attended all of the 9 meetings, and Ms. Ide attended all 7 meetings (since her appointment
inJune 2023). Overview of the Nomination and Remuneration Advisory Committee is as follows:▪ Composition of the Nomination and Remuneration Advisory Committee(1) The Nomination and Remuneration Advisory Committee shall be comprised of internal and external
members, with the majority of committee members being the latter. The number of committee members shallbe set within the range that enables the committee to carry out thorough consultations and to make prompt
and reasonable decisions. Specifically, the committee shall have a total of five members, including two
internal members consisting of the Chairman of the Board of Directors and the President and Chief Executive
Officer, and three external members who are Outside Directors.
(2) The Chairperson of the Nomination and Remuneration Advisory Committee is required to be an external
member.
(3) The Chief Administration Officer (HR Strategy Department) shall serve as the secretariat.
▪ Selection criteria for external committee members
The external members shall consist of those Outside Directors who specifically have extensive knowledge
and experience as well as deep insights, both in and outside the Company, concerning the breadth of issues tobe deliberated by the committee. The composition of external members shall ensure diversity in terms ofknowledge, experience, specialty and so on.
▪ Method for selecting external committee members
External committee members are selected by a resolution of the Board of Directors.
▪ Method for selecting the Chairperson
The Chairperson shall be appointed by a resolution of the Board of Directors based on the outcome of anelection by committee members’ mutual vote.
▪ Handling when the Chairperson has an accident or for other reasons- 20 -

If the Chairperson is unable to act or is otherwise unavailable, another external member shall act in place of
the Chairperson in the order decided by a resolution of the Board of Directors in which the external members
shall exercise their authority to act on behalf of the Chairperson.
▪ Term of office for external committee members and the Chairperson
The terms of office for external committee members and the Chairperson are the same as their term as a
Director.
▪ Resolution method
Any resolution on an agenda item of the Nomination and Remuneration Advisory Committee is required tobe made by a majority of members present at a meeting attended by a majority of committee members.
▪ Convener
The Nomination and Remuneration Advisory Committee is convened by the Chairperson.

[Audit & Supervisory Board Members]
Establishment of Audit & Supervisory Board

Established

Maximum Number of Audit & Supervisory
Board Members Stipulated in Articles of

N/A

Incorporation
Number of Audit & Supervisory Board Members

5

Cooperation among Audit & Supervisory Board Members, Accounting Auditors and Internal Audit
Department

New

Audit & Supervisory Board Members, Accounting Auditor and the Internal Audit Department periodicallyexchange information to enhance cooperation between them. The Company has established the Internal
Auditing Department under the direct supervision of the President and Chief Executive Officer as anindependent body for company-wide monitoring of operations. The department maintains close contact with
the Audit & Supervisory Board Members and Accounting Auditor, such as by reporting audit plans and theresults of internal auditing to them in a timely manner, so as to contribute to effective auditing by the Audit &Supervisory Board Members and Accounting Auditor.
The Audit & Supervisory Board Members endeavor to ascertain the audit activities of the Accounting Auditor
and to exchange information with the Accounting Auditor by holding regular meetings; they also strive toimprove the efficiency and quality of their own audit activities, such as by attending the Accounting Auditor’s
audit review meetings, and being present for inventory audits.
In fiscal 2023, the remuneration paid to KPMG AZSA LLC, the Company’s Accounting Auditor, was asfollows:(a) Fees for services described in Article 2, paragraph (1) of the Certified Public Accountants Act (attestation
services) …¥525 million(b) Fees for services other than those described in Article 2, paragraph (1) of the Certified Public Accountants
Act…¥16 million(c) Total remuneration paid to the Accounting Auditor for fiscal 2023…¥541 million(d) Total amount of cash and other financial benefits payable by the Company and its consolidated
subsidiaries to the Accounting Auditor (including (c))…¥1,147 million
Notes:
1. In line with the “Practical Guidelines for Collaboration with Accounting Auditors” published by the Japan
Audit & Supervisory Board Members Association, the Company’s Audit & Supervisory Board checks the- 21 -

details of audit plans, the performance of duties during the preceding fiscal year, the calculation bases forremuneration estimates, etc., and gives due consideration to these findings when approving compensation,etc. for the Accounting Auditor, as stipulated in Article 399, paragraph (1) of the Companies Act.
2. The audit agreement between the Company and the Accounting Auditor does not differentiate
remuneration and other fees relating to the audit based on the Companies Act from remuneration andother fees relating to the audit based on the Financial Instruments and Exchange Act, and the two typesof remuneration cannot actually be differentiated. Therefore, the above amounts show the total of these
two types of remuneration and other fees.
3. The Company pays remuneration to the Accounting Auditor for creating comfort letters, etc. in addition
to the service defined in Article 2, paragraph (1) of the Certified Public Accountants Act.
4. Some of the consolidated subsidiaries are audited by audit firms other than the Company’s Accounting
Auditor.
In addition, the Audit & Supervisory Board Member attends the Internal Control Committee’s meetings, andreceives reports on the status of the Company’s internal control systems in a timely manner.

Appointment of Outside Audit & Supervisory
Board Members
Number of Outside Audit & Supervisory Board
Members
Number of Independent Audit & Supervisory
Board Members

Appointed
33Outside Audit & Supervisory Board Members’ Relationship with the Company (1)NameAttribute

New

Relationship with the Company*
a

b

c

d

e

f

g

h

i

j

k

l

m

Yukiko Nagashima
From another company△
Nobuo Inada
LawyerTaisei Kunii
CPA△* Categories for “Relationship with the Company”* “○” 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;“▲” when a close relative of the director fell under the category in the pasta. Executive of the Company or its subsidiaryb. Non-executive director or accounting advisor of the Company or its subsidiaries
c. Non-executive director or executive of a parent company of the Company
d. Audit & Supervisory Board Member of a parent company of the Company
e. Executive of a fellow subsidiary company of the Company
f. A party whose major client or supplier is the Company or an executive thereof
g. Major client or supplier of the Company or an executive thereofh. Consultant, accountant or legal professional who receives a large amount of monetary consideration or otherproperty from the Company besides compensation as an audit & supervisory board member
i. Major shareholder of the Company (or an executive of the said major shareholder if the shareholder is alegal entity)
j. Executive of a client or supplier company of the Company (which does not correspond to any of f, g, or h)(the audit & supervisory board member himself/herself only)- 22 -

k. Executive of a company, between which and the Company outside directors/audit & supervisory board
members are mutually appointed (the audit & supervisory board member himself/herself only)
l. Executive of a company or organization that receives a donation from the Company (the audit & supervisoryboard member himself/herself only)
m. Others- 23 -

Outside Audit & Supervisory Board Members’ Relationship with the Company (2)Name

Designationas
Independent
Audit&
Supervisory
Board
Members○

YukikoNagashima○

Supplementary
Explanation of
the Relationship
Ms.
Nagashimaserved until March2016
asRepresentative
Director at Recruit
Staffing Co., Ltd.
with which theCompanyhasbusinesstransactions.
However,thetransaction amountbetweentheCompany
andRecruit
Staffing
Co.,
Ltd.
is
negligible – less
than
0.1%
of
Recruit
Staffing
Co., Ltd.’s total
annual sales. We
havetherefore
determined that her
independence
isunaffected.
―

Nobuo Inada○
Taisei Kunii

Mr. Kunii engaged
until May 2022 in
the execution ofoperational duties- 24 -

New

Reasons of Appointment

Ms. Nagashima has highly specialized knowledge
and a wealth of experience in corporate
management and corporate governance based onher career over many years in which she held key
positions at a major comprehensive humanresources company (holding company), as well as
experience managing group companies and serving
as a full-time audit & supervisory board member at
the holding company and an outside director at amajor corporation. She is also honest in character,as well as highly insightful and capable. Ms.
Nagashima will contribute to the Company’s aim of
conducting audits from diverse perspectives, and isthus judged to be qualified for the role of Outside
Audit & Supervisory Board Member of theCompany and to be able to perform her duties
properly in that position. For these reasons, she isappointed as the position of Outside Audit &Supervisory Board Member.
Ms. Nagashima meets the independence standards
respectively set by the Company, the financial
instruments exchange that the Company is listed on.
The Company has notified the exchange of her
status as an independent auditor.
Mr. Inada has highly specialized knowledge and awealth of experience in law based on his career overmany years as a prosecutor and attorney at law. He
is also honest in character, as well as highly
insightful and capable. Mr. Inada will contribute to
the Company’s aim of conducting audits fromdiverse perspectives, and is thus judged to bequalified for the role of Outside Audit &Supervisory Board Member of the Company and to
be able to perform his duties properly in that
position. For these reasons, he is appointed as the
position of Outside Audit & Supervisory Board
Member.
Mr. Inada meets the independence standards
respectively set by the Company, the financial
instruments exchange that the Company is listed on.
The Company has notified the exchange of his
status as an independent auditor.
Mr. Kunii has highly specialized knowledge and awealth of experience in finance, accounting, andcorporate auditing based on his career over many
years as a certified public accountant. He is also

as Chief Executive
Officer of Deloitte
Touche Tohmatsu
LLC, to which theCompany makes
payments
includingoutsourcing fees.
However,theamountisnegligible – less
than
0.2%
of
Deloitte
ToucheTohmatsu LLC’s
total revenue. We
havetherefore
determined that his
independence
isunaffected.

honest in character, as well as highly insightful andcapable. Mr. Kunii will contribute to the Company’s
aim of conducting audits from diverse perspectives,and is thus judged to be qualified for the role ofOutside Audit & Supervisory Board Member of theCompany and to be able to perform his duties
properly in that position. For these reasons, he isappointed as the position of Outside Audit &Supervisory Board Member.
Mr. Kunii meets the independence standards
respectively set by the Company, the financial
instruments exchange that the Company is listed on.
The Company has notified the exchange of his
status as an independent auditor.

[Independent Directors/Audit & Supervisory Board Members]
Number of Independent Directors/Audit &Supervisory Board Members

8

Matters relating to Independent Directors/Audit & Supervisory Board Members
All of Outside Directors and Outside Audit & Supervisory Board Members in the Company meet theCompany's internal rule of Standards for Appointment and Independence, and also the criteria for
independence set by the financial instruments exchange on which the Company is listed. The Company hasregistered all these individuals as independent executives based on the exchange’s respective provisions.
(https://www.sumitomocorp.com/jp/-/media/Files/hq/about/governance/detail/outdirec_independ.pdf?la=en）[Incentives]
Incentive Policies for Directors

Performance-linked
OthersRemuneration,

Stock

Options,

Supplementary Explanation
The Company’s performance-linked remuneration system for directors is comprised of a performance-linked
bonus plan and a stock-based remuneration plan.
For details about these plans, including (1) the policy on determining the ratio of performance-linked
remuneration, (2) the indicators related to performance-linked remuneration and the reason for adopting such
indicators, and (3) the method for determining the amounts of performance-linked remuneration, see thesection entitled “II. Business Management Organization and Other Corporate Governance Systems regarding
Decision-making, Execution of Business, and Oversight in Management” under “1. Organizational
Composition and Operation [Director Remuneration].”Recipients of Stock Options

Internal Directors, Employees, Other- 25 -

Supplementary Explanation
New Share Acquisition Rights in the Form of Stock Options for a Stock-Linked Compensation Plan to theCompany’s Directors and Executive Officers.
[Summary of the new share acquisition rights]▪ FY2006 111 new share acquisition rights(Number of shares for each new share acquisition right: 1,000 shares Exercise price per share: ¥1)▪ FY2007 944 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2008 1,430 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2009 1,875 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2010 2,172 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2011 2,024 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2012 2,053 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2013 1,569 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2014 1,511 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2015 1,277 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2016 1,695 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)▪ FY2017 1,370 new share acquisition rights(Number of shares for each new share acquisition right: 100 shares Exercise price per share: ¥1)
The Company will not issue new stock options in and after fiscal 2018. Stock options issued in previous years
will remain effective.

[Director Remuneration]
DisclosureofIndividual

Directors’

Remuneration
Supplementary Explanation

Selected Directors

New

The Company states the total remuneration for Directors and Audit & Supervisory Board Members in its annual
securities report and business report, and makes them available for public inspection on the Company’s website.
The total amount of remuneration for the 13 Company Directors in fiscal 2023 was 1,802 million yen, with the
breakdown as follows.
▪ Monthly remuneration: ¥550 million▪ Total amount of bonus: ¥397 million▪ Total amount recorded as expenses for performance-linked stock remuneration in fiscal 2023: ¥107 million▪ Total amount recorded as expenses for restricted performance share unit-based remuneration by calculating
the estimated amount to be paid as monetary remuneration receivables in accordance with the estimated numberof shares to be granted in 2024, 2025 and 2026: ¥ 749 million
For individuals whose total remuneration is 100 million yen or more for the year ended March 31, 2024, thetotal remuneration and its breakdown are as follows:- 26 -

(Unit: Million Yen)

Name

Kuniharu
Nakamura
MasayukiHyodo
Toshikazu
Nambu

Position

Hirokazu
HigashinoMonthly

Directors

remuneration

Share Unit-

remuneration’ bonuses(Performance

Based

Share Unit) plan

Remuneration

(*3)

(*3)

Total

36

165

349

Director

95

152

36

276

559

(*4)

12

0

22

79

113

41

69

0

30

140

Director

54

68

13

85

220

Director

45

54

0

62

162

Director

47

53

0

52

152

(*5)

Morooka

Performance

0

Ueno

Reiji

linked stock149

Director

Seishima

Restricted

Director

ShingoTakayuki

Performance-

1. None of the directors above serve as a director or an audit & supervisory board member of subsidiaries of
the Company, and their remuneration are all paid by the Company.
2. The figures on the table above are rounded to the nearest million yen.
3. The figures represent the amount accounted for (expensed) in fiscal 2023 and are different from the amountof remuneration from shares actually delivered in the same fiscal year.
4. He retired as a director due to the expiration of his term of office at the conclusion of the 155th Ordinary
General Meeting of Shareholders held on June 23, 2023.
5. He was newly elected at the 155th Ordinary General Meeting of Shareholders held on June 23, 2023.
Policy on Determining Remuneration Amounts
and Calculation Methods

Established

Disclosure of Policy on Determining Remuneration Amounts and Calculation Methods

New(1) Matters related to policy for deciding the remuneration for individual directors(A) System for remuneration
・ The remuneration for Executive Directors consists of monthly remuneration, performance-linked bonus,
and stock-based remuneration.
- 27 -

・・The remuneration for the Chairman of the Board of Directors and Director, Vice Chairman consists ofmonthly remuneration and stock-based remuneration.
The remuneration for Outside Directors is fixed-amount compensation only (monthly remuneration).

(B)

Ratio and remuneration standards regarding each types of remuneration
The Company will establish an appropriate ratio, etc. between fixed remuneration (monthly
remuneration) and variable remuneration (“performance linked bonus” which is linked with short term
performance of the Company and “stock-based remuneration” which is linked with middle and long term
performance of the Company and shareholder value) which corresponds to Director’s position, (i) bysetting an appropriate remuneration standards to acquire and retain highly capable management who willbring about the Company’s sustainable growth and increase of corporate value in the middle to longterm, and (ii) to design as healthy incentive to sustainable growth of the Company, based on its businessenvironment, management strategy and human resources strategy, with reference to objective
remuneration market research data, etc. provided by external specialized agencies.

(C)

Policy and method on the decision of the amount of each remuneration



Policy on the decision of the amount of each remuneration
 Monthly Remuneration
Fixed amount remuneration determined based on the abovementioned standards is provided.
 Performance Linked Bonus・ From the perspective of reinforcing the relationship with its group’s management strategy, thetotal amount to be paid is determined in accordance with the performance management index
to be focused on in the medium-term management plan. The amount to be paid to individual
Executive Directors is distributed according to their position and personal evaluation and ispaid after the end of the fiscal year.
・ Each Executive Director is evaluated on the basis of both financial indicators and non-financial
indicators.
 Restricted Performance Share Unit-Based Remuneration
This remuneration is aimed at promoting efforts at optimizing its business portfolio, increasing
corporate value in the medium to long term and to ensure sustainable growth, focusing on the linkwith indicators related to environment, society and governance (ESG) together with shareholder
value. Further, we shall promote to share value with the shareholders. The actual contents and timingof payment of the stock-based remuneration for each Directors is decided by the Board of Directors
after consultation with the Nomination and Remuneration Advisory Committee.



Method on the decision of the amount of each remuneration
Remuneration of each Directors is resolved by the Board of Directors within the limit resolved at theGeneral Meeting of Shareholders. For the resolution by the Board of Directors, the details are deliberated
by the Nomination and Remuneration Advisory Committee and the results thereof are reported to theBoard of Directors. For other method, as follows; Performance Linked Bonus・ The Board of Directors, reflecting reports from the Nomination and Remuneration Advisory
Committee, set assumed values for each performance management index and decide formulafor calculating the performance linked bonuses for individual Executive Directors (for the
relevant fiscal year) based on actual values for each performance management index.
・ After the end of fiscal year, Representative Director, President and Chief Executive Officer(who is delegated such decision by the Board of Directors) shall decide personal evaluationsof each Executive Directors regarding the performance management index which is a part of
the formula, following meetings with each of Executive Directors, and performance linked
bonuses for each fiscal year will be determined as per the formula, within the limit resolved at
the General Meeting of Shareholders.
・ Representative Director, President and Chief Executive Officer will report to the Nomination
and Remuneration Advisory Committee about the grading results to make sure that thepersonal evaluations are appropriate.
 Restricted Performance Share Unit-Based Remuneration- 28 -

The Board of Directors, reflecting reports from the Nomination and Remuneration Advisory
Committee, decide formula for calculating the stock-based remuneration for individual
Executive Directors at the first board meeting of relevant evaluation period based on actual
values for each performance management index in several fiscal years.
・ Nomination and Remuneration Advisory Committee (who is delegated such decision by the
Board of Directors), comprised of Outside Directors, Chairman of the Board of Directors andRepresentative Director, President and Chief Executive Officer, shall decide personalevaluations of each Executive Directors on the non-financial indicator which is a part of theformula, and report the evaluations to the Board of Directors.

・(2) Remuneration system for fiscal 2024
(A) Remuneration standards and remuneration composition ratios of Executive Directors and Executive
Officers
・ We have set competitive remuneration standards and remuneration composition ratios in light ofthe current business environment, business strategies, and human resources strategy. We have done
so with reference to remuneration market research data, etc. provided by independent external
specialized agencies.
・ We have increased the ratio of variable remuneration accounted for by restricted performance shareunit-based remuneration to further strengthen the incentive to increase the Company’s corporate
value over the medium to long term and to pursue business management that is more concerned
than ever before with the Company’s stock price and with a focus on sharing value with theshareholders.
・ We have amended the overall remuneration standard for Executive Directors and Executive Officers
in light of current business results and the level of business results we seek to achieve, with the aimof setting a standard that assists in acquiring and retaining our management personnel.
・ The image of the remuneration of Representative Director, President and Chief Executive Officer
is as shown below.
Fixed remuneration
Variable remuneration
Monthly Remuneration

Performance-Linked Bonus

Restricted performance
share unit-based
remuneration

Before34%changeTotal 34%

33%

33%
Total 66%

▼
After

27%

changeTotal 27%

33%

40%
Total 73%

The above breakdown is calculated based on the rate of achievement of business results, the stock
price growth rate, and the results on non-financial indicators all being 100%. The composition ratios
for each type of remuneration vary according to changes in these rates.
(B) Performance-linked bonus
・ Each fiscal year the Company sets the full-year forecast (consolidated net income for the year) or
the consolidated net income for the year when ROE is 12% (whichever amount is higher) as thetarget business result and decides the total amount of performance-linked bonuses to be paid
according to the rate of achievement of this target business result.
・ The potential range of business results is assumed to be up to 50% above or below the target
business result set each fiscal year and the standard for the total amount of performance-linked
bonuses to be paid is set at 100% when the target business result is achieved, with a range ofvariation from 25% to 175% in line with the potential range of business results.

- 29 -

・

・
・

・

・

If business results fall outside this range, the total amount of performance-linked bonuses to be
paid is decided separately by the Board of Directors based on a report from the Nomination andRemuneration Advisory Committee.
The amount to be paid to individual officers is distributed according to their position and personalevaluation and paid after the end of the fiscal year.
Each officer is evaluated on the basis of both financial indicators (achievement of business plans,
etc. in the respective areas of responsibility) and non-financial indicators (such as individual
Strategic Business Units’ achievement of KPIs and KAIs, and progress in addressing importantcompany-wide issues) so that they can become more aware regarding their commitment tomanagement strategy and results.
The ratio of financial indicators to non-financial indicators in personal evaluation is 50:50, and ofevaluation based on non-financial indicators, 20% relates to the important company-wide issuesof business reform through digital transformation (DX), enhancement of sustainability
management, and promotion of Diversity, Equity & Inclusion.
As a result of increasing the ratio of stock-based remuneration, the stock price growth rate will nolonger be included as an element in the calculation of performance-linked bonuses.

(C) Restricted Performance Share Unit-Based Remuneration
・ With the aim of promoting efforts to increase the Group’s corporate value over the medium to longterm and pursue business management that ensures a focus on sharing value with the shareholders,
the number of the Company’s common shares (restricted) to be provided is calculated according to
the Company’s stock growth rate (ratio of the Company’s stock price growth to the growth rate of
the TOPIX (Tokyo Stock Exchange Stock Price Index)) during the three-year evaluation period.
・ Evaluation based on non-financial indicators (measures to tackle climate change, promotion of
women’s active engagement, and employee engagement) is used to calculate the number of theCompany’s common shares to be granted as restricted shares. In this way the Company aims to enable
increased awareness of its commitment to the enhancement of sustainability management by linking
non-financial indicators (related to environment and/or society) more closely to stock-based
remuneration and further promoting efforts to address its Key Social Issues.
・ To enable a shared focus on shareholder value over the medium to long term, the restriction period
will be from the day the shares are provided until the day the recipient resigns or retires from all theirpositions as Director or Executive Officer of the Company or any other position determined by the
Board of Directors.

New[Supporting System for Outside Directors and/or Audit & Supervisory Board Members]
 In order to contribute to essential deliberations at the Board of Directors, the Company supports its
Outside Directors and Audit & Supervisory Board Members including Outside Audit & Supervisory
Board Members by tasking the Board of Directors secretariat and the Audit & Supervisory Board
Members’ Administration Department with distributing and explaining in advance documents on each
respective agenda to be presented at each meeting of the Board of Directors, and it has appointed asecretary with responsibility for providing the support necessary for Outside Directors to execute theirduties. In addition, the Company established a dedicated organization to support communication between
the Board of Directors and the executing persons (executive officers, etc.), and aims to improve thequality of discussions at the Board of Directors meetings by selection of agenda items to be discussed at
the Board of Directors meetings and organization of issues. The Company has also established the Audit& Supervisory Board Members’ Administration Department as a team dedicated to assisting all Audit &Supervisory Board Members including Outside Audit & Supervisory Board Members with their duties.
The team provides the necessary support as appropriate to enable the Audit & Supervisory Board
Members to perform an effective audit.
 On taking office, Outside Directors and Outside Audit & Supervisory Board Members have theopportunity to receive a briefing on areas including the Sumitomo Corporation Group’s Management
Principles, management policy, business activities, finances, organization, medium-term management
plan, and risk management system. To enable Directors and Audit & Supervisory Board Members toacquire the necessary knowledge and update it as appropriate, we additionally provide access to resources
including seminars and e-learning facilities, offering financial support to cover the necessary costs. To- 30 -

deepen their understanding of Sumitomo’s Business Philosophy, Outside Directors and Audit &Supervisory Board Members visit a Sumitomo-related facility, in principle during the first fiscal year of
their term of office. Outside Directors and Audit & Supervisory Board Member are also given theopportunity to make a group companies observation visit to a facility in Japan and to an overseas.

[Status of persons retired from Representative Director and President, etc.][Names, etc., of advisors (“sodanyaku,” “komon,” etc.) who have formerly served as Representative Director andPresident, etc.]

Name

New

Title/Position

DutiesWorking Arrangement/

Conditions （ Full-time /Part-time,
etc.）
Kenji

SpecialEngagement

only

in

Miyahara

Advisorexternal activities, such

Part-time

Compensation

Date

of

Term

Retirement
from
President,
etc.
2001/6/22

Determined

2003/6/22

Determined

2018/6/22

Determined

Unpaidas activities in business
communities

andactivities related to theSumitomo Group upontherequestPresident

of

and

the
Chief

Executive Officer
MotoyukiSpecialEngagement

only

in

Oka

Advisorexternal activities, such

Part-timePaid

as activities in business
communities

andactivities related to theSumitomo Group upontherequestPresident

of

and

the
Chief

Executive Officer
Kuniharu

SpecialEngagement

only

in

Nakamura

Advisorexternal activities, such

Part-timePaid

as activities in business
communities

andactivities related to the- 31 -

Sumitomo Group upontherequestPresident

of

and

the
Chief

Executive Officer[Total number of advisors (“sodanyaku,” “komon,” etc.)3

who have formerly served as Representative Director
and President, etc.]

New[Other Matters]
・

The Company appoints those who used to serve as the President and Chief Executive Officer or the Chairmenof the Board of Directors as a special advisor for a definite term.

・Special advisors who are eligible for compensation payment receive compensation commensurate with theirduties.

2. Matters on Functions of Business Execution, Auditing, Oversight, Nomination and Remuneration Decisions(Overview of Current Corporate Governance System)
New[Business Execution]▪ In principle, based on checks and balances, there shall be both a Chairman of the Board of Directors and a
President and Chief Executive Officer, and no single individual shall serve as both the Chairman of the Board of
Directors and the President and Chief Executive Officer.
▪ The company has introduced an executive officer system to clarify responsibility and authority for businessexecution. For details on the appointment of Executive Officers, please refer to the description of [Nomination
Function, etc.] [Executive Officers] in this section.
▪ The Company’s Management Council serves as a decision-making body at the operational execution level. Its
aim in so doing is to incorporate diverse opinions and multilateral discussions into the decision-making process
on specific key matters related to management within the scope of its mandate from the Board of Directors. The
Management Council, comprising 7 members - the President and Chief Executive Officer, the Executive Vice
President, 3 chief officers in the Corporate Groups, and 2 CEOs of Business Groups, meets 3 times a month inprinciple. In addition, the Company has established a range of committees to act as advisory bodies to the Chief
Executive Officer and the Management Council with regard to specific matters that are particularly important fromthe perspective of The Company as a whole. The committees are the Corporate Strategy Promotion Committee,
the Global Innovation and Portfolio Committee, the Company Investment Committee, the Internal Control
Committee, the Compliance Committee, the Corporate Sustainability Committee, Corporate Communication
Committee, the IT Strategy Committee, and Pension Management Committee.
▪For the three-year period of the Medium-Term Management Plan 2026 which begins in fiscal 2024, we areestablishing the position of “Vice Chairman,” who will be responsible for strengthening the functions of the Boardof Directors and, at the request of the President & CEO, providing advisory services to support the management
team in terms of transforming the business portfolio and developing management talent.
[Audit & Supervisory Functions]
1. Board of Directors▪ The Company positions the role of the Board of Directors as "The board of directors renders decisions concerning
key management matters and oversees the operation of the business by the directors and the executive officers" in
its Corporate Governance Principles.
▪ The Corporate Governance Principles state that, regarding the number of directors, "The number of directors
shall be set within a scope which enables due deliberation and speedy and reasonable decision-making by the board- 32 -

of directors. Currently, around 15 directors or less is considered an appropriate number." Currently in actual, theCompany has 11 Directors; this means that the structure of the Board of Directors (the functions of which are tosupervise business execution and make decisions relating to important management matters) is such that it canconduct substantive, lively discussions and make appropriate decisions speedily. In addition, management
responsibilities are made clear each business year, and the term of office for Directors is set at one year so as torespond speedily to changes in the business environment and they are reelected every year when they are reelected.
▪ The Corporate Governance Principles state that, as for the composition of the Board of Directors, "Thecomposition of the board of directors shall be diverse in terms of experience, knowledge, specialty, gender, etc."
and the Company strives to further strengthen the appropriate decision-making and supervisory functions of theBoard of Directors from diverse perspectives. Of the current 11 directors, 5 are Outside Directors. Of the 11
directors, 9 are male and 2 are female (both of whom are Outside Directors).
▪ Of the current 11 directors, the remaining 4, excluding Outside Directors, the Chairman, and the Vice Chairman,
concurrently serve as Executive Officers. The 4 directors who concurrently serve as Executive Officers have theauthority of representation.
▪ The Chairman of the Board chairs the Board of Directors. For the role and authority of the Chairman of theBoard, please refer to the description in [Nomination Function etc.] [Chairman of the Board of Directors] in thissection.
▪ The Board of Directors meets once a month, in principle. In fiscal 2023, the Board of Directors met 17 times (14times after June 23, 2023).
▪ The Board of Directors enhances its deliberations and strengthen its monitoring functions by the following
initiatives:
 Agenda items for the Board of Directors are carefully selected by the Board of Directors to promote more
focused discussion of management policies and plans and other important matters for companywide
management. Members of the Board of Directors also select items that should be taken up for more intensive
discussion at the Board of Directors meetings each year (agenda setting); The Board of Directors receives reports from each Business Group on the state of progress on its strategies,
any associated issues and its response to those issues, and carries out a discussion focusing on such issues.
The Board of Directors also periodically monitors the state of business execution companywide by receiving
reports on the activities of the main corporate committees; The Board of Directors holds off-site meetings in addition to regular meetings, for free and open discussions
on important management topics, including management policies and plans and ESG (Environment, Socialand Governance) issues. Moreover, to ensure that Outside Directors and Outside Audit & Supervisory Board
Members actively contribute to the discussions at the Board of Directors, a monthly meeting is held, whichis comprised of Outside Directors and Outside Audit & Supervisory Board Members, in which they engage
in robust discussion; and Prior to every meeting of the Board of Directors, Outside Directors and Audit & Supervisory Board Members
are briefed on the agenda items due for discussion.
▪ Attendance of directors in fiscal 2023 at Board meetings:
Chairman of the Board of Directors Hyodo: 17 times/17 meetings
Director Nambu*: 3 times/3 meetings
Director Ueno**: 14 times/14 meetings
Director Seishima: 17 times/17 meetings
Director Morooka: 17 times/17 meetings
Outside Director Ide: 17 times/17 meetings
Outside Director Mitachi: 17 times/17 meetings
Outside Director Takahara**: 14 times/14 meetings* His attendance at Board of Directors meetings held up until his retirement as a Director on June 23, 2023.
** Their attendances at Board of Directors meetings held up since their appointments as Directors on June 23,2023.
▪ Pursuant to Article 427, Paragraph 1 of the Companies Act, the Company has entered into liability limitationagreements with the Chairman of the Board and each of the Outside Directors to limit their liabilities to the extent
permitted by laws and regulations in the event that they are without knowledge and without gross negligence.

- 33 -

▪ The Company has entered into a liability insurance contract for directors' compensation as provided in Article
430-3 paragraph (1) of the Companies Act, which covers all directors as insured persons. Except for those casesthat fall under the grounds for exemption provided in the insurance contract, the insurance provider shallcompensate directors for any damages, etc. that may arise as a result of either being liable for the performance of
their duties or being subject to a claim for such liability. The Company pays all premiums for the insurance policy.
2. Audit & Supervisory Board Members, Audit & Supervisory Board and Accounting Audit▪ Audit Board of Directors consists of 5 members: 2 full-time Audit & Supervisory Board Members inside theCompany and 3 part-time Audit & Supervisory Board Members outside the Company. Eligibility for the role ofinternal Audit & Supervisory Board Members and external Audit & Supervisory Board Members is as set forth in[Audit & Supervisory Board Members] of [Nomination Functions, etc.]. Experience and ability for the role ofexternal Audit & Supervisory Board Members are as set forth in [Reasons for Appointment] of [Audit &Supervisory Board Members].
▪ The Audit & Supervisory Board has established Audit's policies, division of duties, etc., and receives reports on
the status of implementation and results of Audit from each Audit & Supervisory Board Members, as well asreports on the status of execution of their duties from the Directors, etc. and the Accounting Auditors, and requests
explanations as necessary. In fiscal 2023, our group addressed the following issues as priority areas for Audit,
taking into account (1) rising awareness of social sustainability (sustainability/ESG), (2) dramatic progress in adata-driven society typified by DX (Including the use of AI such as ChatGPT) and the consequent increase in
information security risks, and (3) the dramatic changes in the business environment caused by actualization ofgeopolitical risks in all regions of the world.
(1) Status of compliance with the Companies Act, other laws and regulations, the Company Articles ofIncorporation, internal rules, and the Sumitomo Corporation Group's Management Principles and Conduct
Guidelines(2) Construction and operation status of Internal Control Corporation Group's such as legal compliance system,risk management system, etc.
(3) Establishment and operation of Internal Control for Financial Reporting in accordance with the Financial
Instruments and Exchange Act(4) Accounting Appropriateness of financial reporting through Accounting Auditor's independence, expertise, andmonitoring and verification of Accounting Audit's quality management system▪ Audit & Supervisory Board Member attends meetings of the Board of Directors and other important meetings,
receives reports on the status of the execution of his/her duties from directors and employees, requests explanations
as necessary, examines important approval documents and other documents, and investigates the status of businessand assets with respect to headquarters and major business locations. In addition, with regard to Subsidiary, theAudit & Supervisory Board Member communicates with and exchanges information with Directors and audit &supervisory board members of Subsidiary, and receives business reports from Subsidiary as necessary.
▪ As an organization dedicated to assisting the duties of the role of Audit & Supervisory Board Members, the Audit& Supervisory Board Members’ Administration Department (5 members) has been established. The Audit &Supervisory Board Members is involved in personnel evaluation and personnel changes of the Audit & Supervisory
Board Members’ Administration Department members, and secures the independence of the members of the Audit& Supervisory Board Members’ Administration Department from the Directors.
The Company’s accounting audit was conducted by Michitaka Shishido, Isao Kamizuka and Kenji Kasashima. All
three are certified public accountants at KPMG AZSA LLC, and each has audited the Company’s accounts
continuously for no more than seven years. A total of 94 people assisted with the accounting audit; they comprised
29 certified public accountants, 15 assistant accountants (who have passed the CPA examination) and others, andan additional 50 people. For further details refer also to the sections of this report entitled “Cooperation among
Audit & Supervisory Board Members, Accounting Auditors, and Internal Audit Departments” and “Supporting
System for Outside Directors and/or Audit & Supervisory Board Members.”[Nomination Function, etc.][Overall]▪ The Company has established the Nomination and Remuneration Advisory Committee, an advisory body to theBoard of Directors chaired by an Outside Director, the majority of whose members are Outside Directors.
▪ Refer to the Company’s standards related to the independence of Outside Directors and Outside Audit &Supervisory Board Members from the Company, which are made public on its website.
(https://www.sumitomocorp.com/jp/-/media/Files/hq/about/governance/detail/outdirec_independ.pdf?la=en)- 34 -

[Nomination and Remuneration Advisory Committee] Regarding the composition, matters to be deliberated, etc.
of the Nomination and Remuneration Advisory Committee as an advisory body to the Board of Directors, refer tothe section entitled “II. Business Management Organization and Other Corporate Governance Systems regarding
Decision-making, Execution of Business, and Oversight in Management” under “1. Organizational Composition
and Operation [Director Remuneration],” “Committee’s Name, Composition and Attributes of the Chairperson,”and “Supplementary Explanation.”[President and Chief Executive Officer]▪ The President and Chief Executive Officer shall be responsible for the overall management of the Company.
▪ Appointment criteria (qualities, competencies, experience, etc.)
The President and Chief Executive Officer shall be a person who personifies the Sumitomo business philosophy,
possesses the following qualities and competencies required as the President and Chief Executive Officer, and has
global and diverse experience and achievements in business operation and company management:■Being fair and impartial and being disciplined and self-controlled■Having leadership and the ability to get messages across■Having foresight and the ability to develop strategies■Having the ability to get things done and to make innovative changes■Possessing perseverance and mental fortitude
Any revision of the appointment criteria described above shall be determined by a resolution of the Board of
Directors following the Nomination and Remuneration Advisory Committee’s deliberations and submission of thedeliberation results to the Board of Directors.
▪ Policy and Procedure for Appointment
A new President and Chief Executive Officer shall be appointed by a resolution of the Board of Directors after the
Nomination and Remuneration Advisory Committee nominates candidates for the post of President and Chief
Executive Officer based on the appointment criteria listed above and selects from among the nominated candidates
the person who is considered best suited to enhance the Company’s corporate value as the new President and Chief
Executive Officer, at the appropriate timing in light of the term of the President and Chief Executive Officer (notexceeding six years in principle) and submits nominations to the Board of Directors as recommendations.
▪ Policy and Procedure for Dismissal
In light of the appropriate evaluation of the Company’s performance and other aspects, if the President and Chief
Executive Officer is considered as not properly fulfilling his/her function, the Nomination and Remuneration
Advisory Committee shall, at a meeting to be convened by its Chairperson (which meeting shall not be attended
by the President and Chief Executive Officer), deliberate whether or not to dismiss the President and Chief
Executive Officer and shall report the deliberation results to the Board of Directors. The Board of Directors shallthen decide by a resolution whether or not to dismiss the President and Chief Executive Officer.
▪ Policy and Procedure for Appointment of Successor President and Chief Executive Officer after Dismissal■A successor President and Chief Executive Officer shall be appointed by a resolution of the Board of Directors
after the Nomination and Remuneration Advisory Committee deliberates on, and recommends to the Board of
Directors, the person who is considered best suited to serve as the successor President and Chief Executive Officer.
■If the Board of Directors cannot immediately appoint a successor President and Chief Executive Officer, theperson who is required to exercise the authority to act on behalf of the President and Chief Executive Officer
stipulated under the internal rules shall exercise the authority to execute operations on behalf of the President andChief Executive Officer, and the procedure for appointing a new President and Chief Executive Officer shall be
carried forward as promptly as possible.
[Executive Officers]▪ Executive Officers are in principle appointed by means of selection from among those holding managerial
positions under the Company’s employment grade system. The appointment is determined by a resolution of theBoard of Directors based on recommendations from a superior.
▪ The dismissal of the Executive Officer is determined by a resolution of the Board of Directors as stipulated underCompany regulations.
▪ Candidates for the post of Executive Officer are required to be persons of high integrity with deep insights andexcellent abilities and to possess professional knowledge and extensive experience including management
experience. Factors such as gender or nationality are not taken into consideration.
[Directors]- 35 -

▪ In order to ensure objectivity and transparency of procedures, the nomination of a candidate for the post of
Director is deliberated by the Nomination and Remuneration Advisory Committee, resolved by the Board of
Directors following the submission of deliberation results by the committee and then proposed at the general
meeting of shareholders as an agenda item.
▪ Candidates for the post of internal Director are required to be persons of high integrity with deep insights andexcellent abilities and to possess professional knowledge and extensive experience including management
experience. Factors such as gender or nationality are not taken into consideration.
▪ Candidates for the post of Outside Director are required to be persons of high integrity with deep insights andexcellent abilities and to possess extensive knowledge and experience, accompanied by an outstanding track recordin any specialized field, in light of the Company’s need to ensure diverse perspectives. Factors such as gender or
nationality are not taken into consideration.
[Chairman of the Board of Directors]▪ Role and Responsibilities
The Chairman of the Board of Directors shall convene a meeting of the Board of Directors and presides as chairman
at the meeting. The Chairman of the Board of Directors shall be engaged in external activities, such as activities
in business communities and activities related to the Sumitomo Group.
The Chairman of the Board of Directors shall supervise the management of the Company and have norepresentative powers and no authority to execute business operations.
▪ Policy and Procedure for Appointment
A new Chairman of the Board of Directors shall be appointed by a resolution of the Board of Directors after the
Nomination and Remuneration Advisory Committee deliberates on, and recommends to the Board of Directors,
the person who is considered best suited to fulfill the role and responsibilities stipulated above, at the appropriate
timing in light of the term of the Chairman of the Board of Directors (not exceeding six years in principle).
▪ Policy and Procedure for Dismissal
If the Chairman of the Board of Directors is considered as not properly fulfilling his/her role and responsibilities,
the Nomination and Remuneration Advisory Committee shall, at a meeting to be convened by its Chairperson(which meeting shall not be attended by the Chairman of the Board of Directors), deliberate whether or not todismiss the Chairman of the Board of Directors and shall report the deliberation results to the Board of Directors.
The Board of Directors shall then decide by a resolution whether or not to dismiss the Chairman of the Board of
Directors.
▪ Policy and Procedure for Appointment of Successor Chairman of the Board of Directors after Dismissal■A successor Chairman of the Board of Directors shall be appointed by a resolution of the Board of Directors
after the Nomination and Remuneration Advisory Committee deliberates on, and recommends to the Board of
Directors, the person who is considered best suited to serve as the successor Chairman of the Board of Directors.
■However, if the Board of Directors cannot immediately decide on a successor Chairman of the Board of
Directors, another director shall act as the convener and chairman of meetings of the Board of Directors in placeof the Chairman of the Board of Directors, in the order that shall be separately decided by the Board of Directors
and in which the directors shall exercise their authority to act on behalf of the Chairman of the Board of Directors,
and the procedure for appointing a successor Chairman of the Board of Directors shall be carried forward as
promptly as possible.
[Audit & Supervisory Board Members]▪ In order to ensure objectivity and transparency of procedures, the nomination of a candidate for the post of Audit& Supervisory Board Member is deliberated by the Nomination and Remuneration Advisory Committee, resolvedby the Board of Directors following the submission of deliberation results by the committee and proposed at thegeneral meeting of shareholders as an agenda item after obtaining the approval of the Audit & Supervisory Board.
▪ Candidates for the post of internal Audit & Supervisory Board Member are required to be persons of high integrity
with deep insights and excellent abilities and to possess professional knowledge and extensive experience inbusiness, regardless of gender or nationality.
▪ Candidates for the post of Outside Audit & Supervisory Board Member are required to be persons of high integrity
with deep insights and excellent abilities and to possess highly professional knowledge and a wealth of experiencein a specialized field such as law, accounting, or business management, among others. Factors such as gender or
nationality are not taken into consideration.
[Remuneration Decision-making Function]▪ Remuneration for the Company’s Directors is decided by the Board of Directors within the scope of the overall
amount approved by resolution of the general meeting of shareholders.
- 36 -

▪ The Company has established the Nomination and Remuneration Advisory Committee chaired by an Outside
Director, within which Outside Directors comprise a majority, to serve as an advisory body to the Board of
Directors. The committee reviews the formula and level of remuneration and bonuses for Directors and Executive
Officers and the limit of remuneration for Audit & Supervisory Board Members, and reports the results of its
review to the Board of Directors.

New

3. Reasons for Adoption of Current Corporate Governance System
The Company believes that it is the most appropriate system for the Company by reinforcing the supervisory andmonitoring function of management oversight by electing independent Outside Directors and Outside Audit &Supervisory Board Members and by establishing the Nomination and Remuneration Advisory Committee,
comprised mainly of independent Outside Directors, under an audit & supervisory board member system. The
Company has elected multiple independent Outside Directors (five individuals) with a wealth of experience and ahigh degree of specialized knowledge and expertise in different fields. This ensures appropriate decision-making
in board meetings and further reinforces the oversight function through further diverse perspectives. Also, theCompany has established the Nomination and Remuneration Advisory Committee (chaired by an Outside Director)
as an advisory body of the Board of Directors, in which the majority of members are Outside Directors. Thisenhances independence, objectivity and transparency of the Board of Directors’ function with respect tonomination and remuneration of Executive Officers. To strengthen the oversight framework from an external
perspective, the Company has three independent Outside Audit & Supervisory Board Members who are one
member with experience in corporate management and as a full-time auditor of a publicly-listed company, one
legal expert (a former Prosecutor-General), and one accounting expert out of the five members of the Audit &Supervisory Board, thereby ensuring an auditing system that incorporates a diversity of perspectives. In addition
to attending meetings of the Board of Directors, Audit & Supervisory Board Members are permitted to attend allinternal meetings, enabling them to obtain sufficient information essential for auditing by always participating inimportant meetings. By implementing the measures above, the Company believes that it has developed aneffective, enhanced corporate governance system.
While valuing its management culture as a Japanese corporation, the Company intends to continue deliberating on
the most appropriate form of corporate governance for its own circumstances. In doing so, it will take into accountglobal trends and developments in corporate legislation and use the best aspects of corporate governance in othercountries for reference.

- 37 -

III. Implementation of Measures for Shareholders and Other Stakeholders
1. Measures to Vitalize the General Shareholder Meetings and Smooth Exercise of Voting Rights
Early Notification of General
Shareholder Meeting

New

Supplementary Explanations
The Company sends out a convening notice describing how to access thematerial for the General Meeting of Shareholders to our shareholders (forshareholders who requested the delivery of such material in paper, the printed
material for the General Meeting of Shareholders) approximately three weeks
prior to the meeting. The Company also provides the material for the General
Meeting of Shareholders on our corporate website and submit it to thefinancial instruments exchange that the Company is listed on in advance ofsending the notice, together with its English-language translation.

Scheduling AGMs Avoiding
the Peak Day

The Company holds its general meeting of shareholders early, avoiding the“peak” day.

Allowing Electronic Exerciseof Voting Rights

The Company allows shareholders to exercise their voting rights via theInternet using PCs, smartphones or mobile phones, etc.

Participation in
Voting Platform

Electronic

The Company uses the Electronic Voting Platform for institutional investors
operated by Investor Communication Japan, Inc. (ICJ), allowing institutional
investors sufficient time to examine propositions.

Providing Convocation Noticein English

The Company prepares an English-language translation of the Notice ofConvocation, which it posts on its website.

Other

The Company live-streams the General Meeting of Shareholders forshareholders on internet. The video of the meeting can be viewed on its
website for a certain period after the close of the meeting. Furthermore, we
accept questions from shareholders on internet prior to the General Meetingof Shareholders.

2. IR Activities

New

Supplementary Explanations

Explanation byRepresentative

Preparation and Publicationof Disclosure Policy

The Company has set down a Corporate Disclosure Policy andmade it public in Japanese and English on the Company's
website.
(https://www.sumitomocorp.com/en/jp/about/governance/det
ail/disclosurepolicy)

Regular Investor Briefings
for Individual Investors

The Company periodically holds briefings in major cities inJapan. In fiscal 2023, the Company held 14 briefings. The
Company discloses on its website explanatory materials andvideos used in the event as well as the records of dialogues
with participants on the event days.

- 38 -

Yes

Regular Investor BriefingsforAnalystsandInstitutional Investors

Following the announcement of financial results (after the endof each quarter and each fiscal year), the Company holds
briefings for analysts and institutional investors in Japan in atimely manner. In addition, the President and the CFO jointly
host small meetings on a semiannual basis. The Company
holds business units briefings on a regular basis and otherevents including IR Day (former Investor Day) and ESG
briefings from time to time.
The Company discloses on its website explanatory materials
and videos used in the event as well as the records of dialogues
with participants on the event days.
( https://www.sumitomocorp.com/en/jp/ir )YesRegular Investor Briefings
for Overseas Investors

The Company has continued one-on-one meetings withmainly institutional investors in Europe, North America andAsia hosted by the President, CFO, CSO, and the General
Manager of Investor Relations.
The Company also has had one-on-one meetings withmanagers in charge of exercising voting rights at institutional
investors (SR activities) and ESG dialogues with institutional
investors in and outside Japan from a medium- to long-term
perspective.
Refer to the details which are disclosed in this corporate
governance report in the section entitled “I. Basic Views on
Corporate Governance, Capital Structure, Corporate Profile
and Other Basic Information” under “1. Basic Views[Disclosure Based on the Principles of the Corporate
Governance Code]” under “[Principle 5-1].”

Yes

Posting of IR Materials on
WebsiteThe Company posts materials that may be useful for investors
to make investment decisions or otherwise on its website in atimely manner. These materials include financial results,
Tokyo Stock Exchange filings other than financial results,
annual securities reports, quarterly reports, company briefing
materials, integrated reports, Notices of Convocation for thegeneral meetings of shareholders, and business reports.
( https://www.sumitomocorp.com/en/jp/ir )EstablishmentofDepartment and/or Manager
in Charge of IR

The Company has established the Investor Relations
Department as the department in charge of IR activities, which
is jointly managed by CFO and CSO and plans andimplements a range of IR and SR activities.

3. Measures to Ensure Due Respect for Stakeholders
Stipulation of Internal Rules
for Respecting the Position of
Stakeholders

New

Supplementary Explanations
The Sumitomo Corporation Corporate Governance Principles stipulate theCompany’s policy with regard to respecting the positions of stakeholders.
The Corporate Disclosure Policy is also established. The Japanese version
and the English version of the Policy are available on the website of theCompany.
(https://www.sumitomocorp.com/ja/jp/about/governance/detail/disclosurepo
licy )- 39 -

Development of Policies on
Information
Provisionto
Stakeholders

The Sumitomo Corporation Corporate Governance Principles stipulate that
the Company strives to actively disclose information to stakeholders and toensure that information is disclosed in full. The Corporate Disclosure Policy
is also established. The Japanese version and the English version of the Policy
are available on the website of the Company.
(https://www.sumitomocorp.com/
ja/jp/about/governance/detail/disclosurepolicy)

IV. Matters Related to the Internal Control System
New
1. Basic Views on Internal Control System and the Progress of System Development
The Company’s Board of Directors approved the development of the systems (internal control systems) set
forth in the Companies Act, Article 362, paragraph (4), item (vi), described below.
In addition, the Internal Control Committee assessed the implementation of the approved internal control
systems, confirmed that these internal control systems are functioning effectively, and reported this fact at theBoard of Directors’ meeting.

The Company will establish and implement, as described in the following, systems to ensure that theCompany’s Directors comply with laws and regulations and the Company’s Articles of Incorporation in theexecution of their duties, and other systems necessary to ensure the properness of the operations of theCompany and operations of group of enterprises consisting of the Company and its subsidiaries (these systems
are hereinafter referred to collectively as the “Internal Control System”).
The Internal Control System based on this resolution has already been established and implemented, but
henceforth the Company will endeavor to establish a superior system in line with requests made from time totime based on ongoing reevaluations.
1.

Systems for ensuring that the execution of duties by Directors and employees complies with laws andregulations and the Articles of Incorporation:
・ In addition to explicitly requiring compliance with laws and regulations under the “Corporate Mission
Statement” of the Sumitomo Corporation Group, the Company will set forth important items that are tobe observed with particular strictness from the viewpoint of compliance as “Sumitomo Corporation
Group Compliance Policy” and a “Compliance Manual” will be prepared and distributed to all officers
and employees.
・ The Company will require all officers and employees to provide a written “Confirmation of Compliance”
with the purport of rigorously assuring strict compliance with laws and regulations.
・ Based on the Company’s internal rules, a “Chief Compliance Officer,” a “Compliance Committee,”“Compliance Leaders,” and a “Speak-Up System” will be created.
・ The Chief Compliance Officer will supervise the handling of potential and verified complianceviolations, will implement measures to ensure compliance, and will deal with matters brought to light
via the “Speak-Up System.”・ The Compliance Committee will formulate and propose compliance-related measures, and will offer
advice to the Chief Compliance Officer on the implementation of these compliance-related measures.
・ Compliance Leaders will rigorously assure compliance in each Business Group and domestic andoverseas office from a position close to the front lines, and they will also conduct activities relating tocompliance enlightenment.
・ Routes will be secured via the Speak-Up System that enable employees and officers to communicate
information on compliance directly to the Chief Compliance Officer, with the Legal Department, Audit& Supervisory Board Members, outside professionals, and outside attorneys serving as liaisons.

2. Systems for retaining and managing information pertaining to the Directors’ execution of their duties:
・ Important documents with regard to meetings of each type, including minutes of meetings of the Boardof Directors, and information pertaining to the execution of duties and decision-making will be properly
preserved and managed under internal rules regarding the respective matters.
・ Steps will be taken under internal rules to prevent divulgence of information to third parties or other- 40 -

misuse of information.
・ Important documents pertaining to the Directors’ execution of their duties will be made available forreview in a timely manner when requested by an Audit & Supervisory Board Member.
3. Rules and other systems pertaining to the management of risk of loss:
・ The Company defines “risk” as “the possibility of losses due to the occurrence of anticipated orunanticipated situations,” and also as “the possibility of not achieving the expected return on businessactivities.” The Company has set the following three items: “stabilize performance,” “strengthen
financial base” and “maintain corporate reputation” as the goals of its risk management activities. The
Company categorizes its business activities into investments and commercial transactions and manages
risk after identifying both common and category specific risk factors. Furthermore, the Company willcontinue to evolve its risk management activities in order to adequately respond to changes in external
environment and the development of new business models.
・ The sections of the Corporate Group will build a framework, conduct monitoring, and implement
improvements regarding risk management across all levels of the Company through the formulation ofinternal rules pertaining to the respective areas of operational responsibility and the formulation of risk
management policies, methods, and guidelines. In addition, they will strive to improve risk management
through the preparation and distribution of manuals and training activities as appropriate. All business
units and other sections conducting business including the Business Group will carry out risk
management required for the conduct of individual cases under this company-wide framework.
・ An “Internal Control Committee” will be instituted and will carry out overall management and timely
evaluation of internal controls as a whole on a consolidated basis, along with the identification ofimportant issues with respect to internal controls and the planning and implementation of basic policies
for improvement. In addition, in order to more efficiently operate each of the existing internal control
frameworks, create synergies, and collaborate with the 3rd Line (the Internal Auditing Department), the"Internal Control Promotion Department," which will be responsible for conducting the Sumitomo
Corporation Group's internal control-related operations in an integrated manner, will be establishedwithin the same organization with the Internal Auditing Department under the "Head of Internal Control
and Internal Audit Group." The Internal Control Promotion Department will actively identify issues interms of internal control matters and utilize internal control activities within the Sumitomo Corporation
Group to establish a more effective and consistent PDCA cycle for internal control throughout the
Sumitomo Corporation Group.
・ A “Company-wide Loan and Investment Committee” will be established as an advisory organ to the“Management Council”, which serves as a decision-making body and will carry out deliberations
regarding important rules, systems, and the like for risk management and regarding important investment
and financing cases.
・ A “Corporate Sustainability Committee” will be established as an advisory body to the “Management
Council”, which serves as a decision-making body and discusses important policies, measures, andinitiatives relating to the promotion of sustainability.
・ The Company will develop and maintain the resilient system to ensure the safety of its Group members,
rapid recovery and continuity of its business under the crisis such as natural disasters (Earthquake,
Windstorm, Flood, etc.), infection disease, terrorism or riot, etc.
・ The “Internal Auditing Department” will be established under the direct supervision of the President andChief Executive Officer as an independent body for company-wide monitoring of operations, and its
auditing will apply to all organizations within the Company and in its domestic and overseas subsidiaries.
The results of internal auditing will be reported directly to the President and Chief Executive Officer
each month and will also be reported regularly to the Board of Directors.
4. Systems for ensuring the efficient execution of the Directors’ duties:
・ The size of the Board of Directors will be sufficient to enable full discussions and speedy and reasonabledecision-making.
・ Two or more Outside Directors will be elected so that through their diverse perspectives, the Company
can ensure appropriate decision-making in the meeting of the Board of Directors and further
enhancement of supervisory functions.
・ A system of Executive Officers will be introduced in order to clarify responsibility and authority for the
execution of operations and to endeavor for the strengthening of the supervisory functions of the Board- 41 -

of Directors.
・ With the exceptions of the Chairman of the Board of Directors and Outside Directors, all Directors will,in principle, be Representative Directors, and will hold concurrent posts as Executive Officers.
・ Management responsibilities will be made clear each business year, and the term of office for Directors
will be set at one year so as to respond speedily to changes in the management environment.
・ The terms of office of the director serving as the Chairman of the Board of Directors and of the executive
officer serving as the President and Chief Executive Officer will not, in principle, exceed six years each.
・ A “Nomination and Remuneration Advisory Committee” composed of a majority of outside directors
will be established as an advisory organ to the Board of Directors. The Nomination and Remuneration
Advisory Committee will deliberate on the matters 1 through 8 below and will submit the results thereofas recommendations to the Board of Directors. Additionally, the committee shall also deliberate anddetermine any matters delegated by the Board of Directors that are not included in following matters,
and report the outcome of such deliberation or decision to the Board of Directors:(1) Policy and procedure for appointment and dismissal of the President and Chief Executive Officer(2) Policy and procedure for appointment and dismissal of the Chairman(3) Nomination criteria for Directors and Audit & Supervisory Board Members(4) Appointment and dismissal of the President and Chief Executive Officer (including nominating
successors to the President and Chief Executive Officer)(5) Nominations of candidates for Directors and Audit & Supervisory Board Members (including
deciding Representative Directors and Executive Directors)(6) Appointment of members of the Management Council(7) Structure and level of remuneration and bonuses for Directors and Executive Directors, as well as
limits for remuneration of Audit & Supervisory Board Members(8) Advisor system.
・ A dedicated organization will be established to strengthen the support functions of the Board of
Directors, such as communication between the Board of Directors and the executing persons (executive
officers, etc.), selection of agenda items to be discussed at the Board of Directors meetings, andorganization of issues, to improve the quality of discussions at the Board of Directors meetings.
・ In addition to the Management Council as a decision-making body, various committees will beestablished as advisory organs. In addition, “Liaison Meetings” and various other conferences will beinstituted for the exchange of information.
・ A medium-term management plan will be formulated and a budget will be compiled to set goals. In
addition, a performance management system will be introduced in order to ascertain the state of BusinessGroup CEO’s execution of operations and to serve in the formulation of strategies for the future.
・ Under internal rules, agenda items requiring discussion by the Board of Directors will be specified inwriting, and the job responsibilities of officers and employees will be made clear; in addition, thedecision-making authority of officers and employees regarding important matters will be specified inwriting.
5.

Systems for ensuring the properness of operations by the corporate group comprising the Company andits subsidiaries:
・ The Corporate Mission Statement of the Sumitomo Corporation Group promotes compliance with laws
and regulations and the sharing of values to be respected throughout the Group.
・ For the purpose of sharing and implementing its approaches to group management, the Company will
establish the Group Management Policy（GMP）and set Jiritsu (working toward one’s own goals subject
to Group rules and accountability), dialogue, and collaboration as the three principles of groupmanagement. Through this, the Company will aim to enhance the corporate value of its Group as a whole.
・ In order to ensure that appropriate institutional decisions which contribute to maintaining and enhancing
enterprise value of its subsidiaries and other consolidated companies are made, the Company shall –based on agreements with such group companies – obtain enough information and request priorconsultation on “important management matters”. In addition, the Company will manage its subsidiaries
and other consolidated companies through the dispatch of directors, audit & supervisory board members,
and employees and other personnel assigned who execute business operations – in line with thebusinesses and situations of such group companies.
・ The Company will carry out support so that internal controls are created, operated, evaluated, andimproved appropriately at its subsidiaries and other consolidated companies.
- 42 -

・ Internal audits of subsidiaries and other consolidated companies of which the Company is the managing
entity will be conducted in accordance with internal rules.
・ The Company will support its subsidiaries and other consolidated companies to construct a framework
for risk management, including risk management policies, methods, guidelines, regulations, etc., and to
make necessary improvements thereto.
・ Subsidiaries will be supported to develop systems for complying with laws and regulations in the same
strict manner as the Company, including through aiming to familiarize and implement “Sumitomo
Corporation Group Compliance Policy,” the expansion of the “SC Global Speak-UP” system (aninternal whistle-blowing system for Sumitomo Corporation group companies), the establishment of aCompliance Committee, and the preparation/distribution of a Compliance Manual.
・ The Company will ascertain its consolidated performance, including that of subsidiaries, promptly andaccurately on a monthly basis, and it will carry out performance management in detail.
6. Matters regarding personnel assigned to support the operations of Audit & Supervisory Board Members:
・ An “Audit & Supervisory Board Members’ Administration Department” will be established to support
the operations of the Audit & Supervisory Board Members, and several full-time staffers will be assigned
to this department.
・ Internal rules will clearly stipulate those persons authorized to issue instructions to the Audit &Supervisory Board Members’ Administration Department and the responsibilities of the Audit &Supervisory Board Members’ Administration Department, and will clearly define the purpose of the
Audit & Supervisory Board Members’ Administration Department as an organization for assisting the
Audit & Supervisory Board Members in their operations.
・ The personnel evaluations of the members of the Audit & Supervisory Board Members’ Administration
Department will be conducted by the Audit & Supervisory Board or an Audit & Supervisory Board
Member appointed by the Audit & Supervisory Board. In addition, the Directors shall consult in advancewith the Audit & Supervisory Board or an Audit & Supervisory Board Member appointed by the Audit& Supervisory Board and obtain the consent thereof regarding personnel transfers.
7. Systems for reporting to Audit & Supervisory Board Members:・ Audit & Supervisory Board Members may attend all meetings, including those of the Management
Council. In addition, the Chairman of the Board of Directors, the President and Chief Executive Officer,
and the Audit & Supervisory Board Members will meet regularly.
・ Important materials pertaining to the execution of operations involving the Company, its subsidiaries andother consolidated companies will be delivered to the Audit & Supervisory Board Members, and officers
and employees will report and give briefings to the Audit & Supervisory Board Members as necessary.
・ Persons submitting the aforementioned reports and persons making contact via the Speak-Up System
will not be subjected to adverse treatment due to such reports/contact.
8.

Other systems for ensuring that auditing will be carried out effectively by the Audit & Supervisory Board
Members:
・ The external Audit & Supervisory Board Members will be experts on law, accounting, and the like, andauditing will be implemented from diverse points of view.
・ The Internal Auditing Department will maintain close contact with the Audit & Supervisory Board
Members so as to contribute to effective auditing by the Audit & Supervisory Board Members, such as
by reporting the plans and results of internal audits to the Audit & Supervisory Board Members in atimely manner.
・ The Audit & Supervisory Board Members will endeavor to ascertain the audit activities of the
Accounting Auditor responsible for auditing the Company’s financial results and exchange information
by holding regular meetings, and will endeavor to efficiently and qualitatively improve the audit
activities of the Accounting Auditor such as by attending audit evaluation meetings, and being present
for inventory audits.
・ In order to pursue their duties appropriately, the Audit & Supervisory Board Members will endeavor tocommunicate and exchange information with the subsidiaries’ audit & supervisory board members, suchas by conducting liaison meetings with them.
・ Internal rules will clearly stipulate the methods for handling the expenses and liabilities incurred by Audit& Supervisory Board Members in the execution of their duties.
- 43 -

2. Basic Views on Eliminating Anti-Social Forces
One of Sumitomo Corporation’s Activity Guidelines is “to comply with laws and regulations while
maintaining the highest ethical standards.” To ensure that this is put into practice, the Company makes all
personnel aware of its basic policy of not yielding to anti-social forces*, but confronting them resolutely,
which is set out in the compliance manual distributed to all officers and employees. In line with this basic
policy, the Company has put an internal system in place to preclude relationships with anti-social forces, asdetailed below.
▪ Within the department in charge of general affairs, the Company has appointed an individual responsible forhandling unreasonable demands from anti-social forces. This individual oversees the response if any
unreasonable demands are received, while gathering and centrally managing related information.
▪ The Company has prepared a manual on responding to anti-social forces, and provides relevant educational
programs for its personnel including regular training sessions.
▪ The Company has forged close partnerships with external specialists, such as the police and attorneys. It
monitors and manages compliance when individual organizational units respond to anti-social forces.
* “Anti-social forces” is the term used in Japan to refer to organized crime groups and similar entities.

- 44 -V.

Other

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

Not Adopted

Supplementary Explanation--New

2. Other Matters Concerning to Corporate Governance System
The Sumitomo Corporation Corporate Governance Principles stipulate that the essence of corporate
governance is improving management efficiency and maintaining sound management, while ensuring
management transparency in order to secure these two aims. Furthermore, the Company makes proactive
efforts to disclose corporate information in a timely and appropriate manner. Its Corporate GovernancePrinciples state, “In an effort to bring an accurate understanding of the Company’s management policies andbusiness activities to all stakeholders, the Company shall strive to make full disclosure, not limiting itself tothe disclosure of information required by law, but also actively pursuing the voluntary disclosure of
information.” In accordance with this fundamental approach, the Company has instituted internal rules
relating to the handling and disclosure of corporate information. In specific terms, these rules stipulate points
to bear in mind and internal procedures relating to timely disclosure as prescribed in the timely disclosurerules of the Tokyo Stock Exchange. The Company also endeavors to ensure appropriate management ofcorporate information, having instituted internal rules to prevent insider trading, among other measures. As aframework for internal information management, it has put an internal system in place to ensure timely andappropriate disclosure by appointing an individual responsible for information handling in the Corporate
Group to gather and centrally manage information.
To provide a means of communicating corporate information internally, the Company has enabled BusinessGroups and other operating entities to enter information related to financial results directly into the accounting
system, from which the data is immediately transmitted and aggregated. Moreover, information related toconsolidated financial results from subsidiaries and other consolidated companies can also be entered directly
into the Company’s consolidated financial results system by those companies, enabling rapid transmission
and aggregation of the data. The reliability of such information is assured by checking it using appropriate
business procedures and internal accounting rules based on generally accepted corporate accounting
standards.
Other material corporate information is transmitted to and aggregated in the Corporate Group pursuant tointernal rules, and using previously determined means. Information thus gathered is promptly reported to the
Executive Officer in charge of information disclosure, and depending on the nature of the information,
including its content and materiality, the Executive Officer issues instructions to the individual responsiblefor information handling regarding whether the information in question requires timely disclosure, and if so,
the method to be used. If any inadequacies or difficulties arise with regard to the internal procedures ororganization, the relevant departments consult with each other and promptly enact countermeasures.
The Company’s internal systems with regard to transmission, and timely and appropriate disclosure, ofmaterial corporate information are as detailed above, but the Company is continuing efforts to further improve
its internal control systems.

- 45 -

- 46 -

The Skills that the Board of Directors is required to possess
All Directors and Audit & Supervisory Board Members of the Company, regardless of whether they are internal or Outside Directors or Audit & Supervisory Board
Members, are required to be honest in character, as well as highly insightful and capable, in accordance with their respective qualifications. Also, the Company raises"No.1 in Each Field" as a theme under "Medium‐Term Management Plan 2026," and the Company is transforming its business portfolio by leveraging the strengths ofindividual businesses to reinforce them and strengthening people and organizations, which are the driving forces for growth. Through such initiatives, the Company will
strive to enhance the Group's competitive advantages and achieve growth by addressing social challenges. For successful implementation of this management plan, we
have identified the types of knowledge, experience, and competencies, etc. (hereinafter "Skills") which enables the Board of Directors to adequately fulfill its roles ofmaking decisions on important business matters and supervising business execution. "Governance" and "Global perspective" are Skills that all Directors and Audit &Supervisory Board Members are required to possess, while we believe that the Board of Directors as a whole should possess the other seven Skills. Of these seven skills,
for Audit & Supervisory Board Members we place a particularly high priority on "Corporate Management", "Finance/Accounting", and "Legal/Risk Management". As the
Skills that the Board of Directors is required to possess may vary according to business strategies or changes in the external environment, the Board of Directors willcontinue to discuss the skills required, make necessary changes, and disclose such changes.

Skills that all Directors and Audit & Supervisory Board Members are
required to possess and reasons why these Skills are necessary

GovernanceWe believe that in order to fulfill our mandate from shareholders while at the same time managing our business in the interests of all stakeholders, it isessential for all Directors and Audit & Supervisory Board Members to be well‐equipped with a high level of knowledge regarding governance. The essenceof corporate governance based on our view is defined in the Sumitomo Corporation Principles as "improving management efficiency," and "maintaining
sound management," as well as "ensuring management transparency".

GlobalPerspective

From the perspective that the Company conducts business transactions and investments throughout the world, we believe that all Directors and Audit&
Supervisory Board Members should have keen insight from a global perspective. We view that this Skill entails the ability to plan and implement an
optimal business strategy that combines caution with flexibility even when different cultures, alternative industrial structures, or the latest geopoliticaldevelopments etc. make the situation extremely uncertain. We also view that this Skill includes the ability to appropriately supervise the execution ofrelated management duties.

Skills that the Board of Directors as a whole is required to possess andreasons why these Skills are necessary

Corporate
Management

The Company engages in a range of business activities, aiming for a stable and sustainable increase in its corporate value. As the Board of Directors is the
body that makes decisions on the Company's important business matters and supervises operational execution, we place a high priority on Skills related tocorporate management. Such Skills are necessary to plan and implement an optimal business strategy for creating value in accordance with the Company's
Management Principles while also meeting our stakeholders' expectations in a constantly changing operating environment.

Investment/M&A

The Company invests in a diverse range of business domains. We consider Skills related to investment and M&A to be important for maximizing corporate
value by selecting and implementing investment projects aligned with our strategy, and for supervising the progress of such projects. Such Skills include
the abilities to clearly define investment objectives and determine their compatibility with our strategy, to properly evaluate investment targets, toundertake post‐investment monitoring, and to ascertain the best timing for replacement of assets. We believe that it is expected for the Board of Directors
to take a broad overview of investment projects and express its opinions on such projects from a standpoint one step away from that of Executive Officers
and other executives.

IT/DX/
Technology

As accelerating technological advancements transform societies and industrial structures, the Company will continue to create value by responding withagility to such change, by anticipating change to pursue business innovation, and by creating new businesses. We will also reform our own businessfoundation by making effective use of new digital technologies such as AI in our business activities in line with our own values. We therefore place priority
on Skills related to IT, DX, and Technology to facilitate decision‐making and supervision in relation to such initiatives.

Sustainability

Having identified certain important challenges that need to be prioritized as Material Issues, and placed these issues at the core of its business
management, the Company always pays attention to whether its businesses are contributing to society. We are pursuing sustainability management,
which entails anticipating long‐term changes in our operating environment relating to social issues and allocation management resources strategically tocontribute to a sustainable society and achieve sustainable growth for the Company. In order to implement and supervise such management, therefore,
we place priority on knowledge and Skills relating to sustainability, including awareness of international trends and understanding of the relevant issues.

Finance/Accounting

To enhance its corporate value sustainability, the company endeavors to achieve medium‐to long term earnings growth and increase its returns toshareholders while maintaining a healthy balance between investment for growth and a solid financial position. To enable us to make appropriate
decisions and properly inform the Company's initiatives to stakeholders as we work forward toward these goals, we need to provide accurate, timely
financial reporting. We regard specialized Skills relating to finance and accounting as vital for the implementation and supervision of these tasks.

Legal/Risk
Management

We consider three goals to be of key importance in ensuring that the Company achieves sustainable, robust growth: stabilizing performance,
strengthening our financial base, and maintaining our corporate reputation. To achieve these objectives, we conduct appropriate risk management using
various means. These include assessing and analyzing the risks that accompany commercial transactions, business investments, and other business
opportunities, keeping the Company's total Risk‐weighted Assets to within our buffer (shareholder's equity) and maximizing Risk‐adjusted Return.
Accordingly, we place priority on a wide variety of risk management‐related skills necessary to achieve these ends, including the ability to screen andmonitor transactions, investments, and loans, and expertise in legal and compliance risk management.

HRmanagement&
development

Regarding human resources as its most important form of business capital, the Company provides each individual with opportunities for autonomous
growth and self‐realization and strives to upgrade its HR management cycle. Through such efforts, we are maximizing the performance of our diverse
workforce and the organization as a whole, thereby pursuing our business strategies and creating new value. We particularly emphasize Diversity, Equity &Inclusion, which we recognize as the core enabler for value creation, innovation, and competitiveness. We therefore regard Skills related to HR
management and development as important for enabling the Board of Directors to make key decisions on such initiatives and supervise theirimplementation.

Skills that Directors or Audit & Supervisory Board Members currently in office possess
Of the Skills identified above as necessary for the Board of Directors as a whole, Skills currently possessed by individual Directors or Audit & Supervisory Board members
are shown in the table below. The skills of individual Directors or Audit & Supervisory Board Members are determined after considering all their attributes, including theircareers, knowledge, experience, capabilities, qualifications, and specific achievements, and discussing these with the individuals concerned.
A brief history of each of the incumbent Directors and Audit & Supervisory Board Member is disclosed.
https://www.sumitomocorp.com/en/jp/about/company/officer

Name
Masayuki Hyodo
Tomokazu Nambu
Shingo Ueno
Takayuki Seishima
Reiji Morooka
Norihiko Nonaka

Role

Director, Chairman
Director
Vice Chairman
Representative Director,
President and Chief
Executive Officer

Corporate
management

Investment/ M&A

Knowledge, experience and competencies, etc.（Skills）
IT / DX /Finance /Sustainability
Technology
Accounting

●

●

●

●

●

●

●

●

●

Legal / Risk
management

HR management& development

●

●

●

●

●

●

Representative Director,
Executive Vice President

●

●

●

Representative Director,
Senior Managing Executive
Officer
Representative Director,
Senior Managing Executive
Officer

●

●

●

●

●

Akiko Ide

Outside Director●

Takashi Mitachi

Outside Director

●

●

●

Takahisa Takahara

Outside Director

●

●

●

Haruyasu Asakura

Outside Director●●

Nana Otsuki

Outside Director●●

Daisuke Mikogami

Senior Audit & Supervisory
Board Member (Full‐Time)●●

Kazunari Sakata

Audit & Supervisory Board
Member (Full‐Time)●●

Yukiko Nagashima

Outside Audit & Supervisory
Board Member●●

Nobuo Inada

Outside Audit & Supervisory
Board Member

Taisei Kunii

Outside Audit & Supervisory
Board Member

●

●

●

●

●

●

●

●

●
●

●

●

●

●