Enacted: May 15, 2006

Board of Directors Resolution

Revised: April 14, 2010

Board of Directors Resolution

Revised: April 25, 2012

Board of Directors Resolution

Revised: April 27, 2015

Board of Directors Resolution

Revised: April 20, 2020

Board of Directors Resolution

Revised: April 19, 2021

Board of Directors Resolution

Revised: April 20, 2022

Board of Directors Resolution

Basic Policy Regarding the Internal Control System
Marubeni-Itochu Steel Inc. (MISI) hereby formulates the following internal system(internal control system) for the purpose of ensuring the appropriate operations ofthe corporate group comprised of MISI and MISI subsidiaries (hereinafter, “the MISIGroup”), pursuant to the provisions of the Companies Act and the Ordinance for
Enforcement of the Companies Act.
1. System to Ensure that the Execution by MISI Group Directors and Employees of
their Duties is in Compliance with Applicable Laws and Regulations and the Articlesof Incorporation(1) Corporate Governance① The board of directors shall act in compliance with applicable laws andregulations, MISIʼs articles of incorporation, the board of directors regulations andother internal regulations when determining important matters pertaining tomanagement, as well as when overseeing directors executing their assigned duties.
② Directors shall execute their assigned duties in compliance with applicable laws
and regulations, the articles of incorporation, board of directors resolutions andinternal regulations, pursuant to the roles the board of directors determine.
③ An executive officer system shall be adopted to strengthen decision-making andsupervisory functions and enhance the efficiency of the board of directors executing
their duties. Executive officers shall execute their assigned duties in accordance withdecisions the board of directors renders, acting under the instructions andsupervision of representative directors.
④ Corporate auditors shall exercise their authority as stipulated in applicable laws
and regulations, and collaborate with the MISI Audit Department and accounting
auditors when conducting inspections of the appropriateness and legality of theexecution of duties by directors, pursuant to the board of corporate auditors

regulations and corporate auditor audit standards.
⑤ In principle, directors and corporate auditors shall be assigned to individualsubsidiaries. The assigned officers shall supervise and evaluate how well eachsubsidiary executes its assigned duties, striving to ensure that how the directors
and employees of the company execute their duties conforms with applicable laws
and regulations and MISIʼs articles of incorporation.
(2) Compliance① Compliance regulations determining the compliance system, and the MarubeniItochu Steel Group Compliance Manual specifying judgment and conduct guidelines
for MISI Group directors and employees shall be formulated. The goal is to maintainhigh corporate ethics and scrupulous compliance with applicable laws andregulations and the articles of incorporation throughout the MISI Group.
② A chief compliance officer shall be named, and a Compliance Committee shall beestablished. Said committee shall create, support, manage and implementawareness activities related to the compliance system. This includes formulating
and revising the aforementioned compliance manual, as well as furnishing guidance
and other services to MISI Group companies.
③ To address conduct problematic from the standpoint of compliance, a contact
point (hotline) shall be established for the entire MISI Group to deal with cases inwhich office organizational lines fail to function for whatever reason.
④ A department shall be established for the purpose of issuing declarations statingthat the MISI Group prohibits and rejects all ties with antisocial forces. It shall also
formulate internal regulations and manuals, collaborate with external agencies andadopt other steps to implement that stance.
(3) Ensuring Financial Reporting Appropriateness① Commercial transaction regulations, accounting regulations and other internalregulations shall be stipulated pursuant to accounting standards and applicable laws
and regulations, with regular evaluations of the compliance and management statusof such regulations performed to realize improvements.
② All subsidiaries shall be required or recommended to undergo audits conductedby accounting auditors.
(4) Internal Audits
An audit department shall be established under the direct jurisdiction of thepresident. Pursuant to internal audit regulations, the Audit Department shallregularly audit all aspects of MISI Group operations, examining the status ofcompliance according to applicable laws and regulations and the articles ofincorporation and internal regulations, as well as evaluating the appropriateness ofprocedures and contents involved in the execution of duties and monitoring thestatus of improvements the Audit Department recommended as well as proposedmatters. The results of completed audits shall be reported to the president, together
with immediate reports to representative directors and corporate auditors if serious
matters are discovered during audits. Corporate auditors shall collaborate closelywith the internal audit organizations of Group companies, endeavoring to raise thequality of audits throughout the MISI Group.
2. Systems for Preservation and Management of Information Relevant to Executionof MISI Director Duties(1) Information Preservation and Management
Internal regulations shall be determined regarding document management andinformation security, followed by the appropriate preservation and management ofgeneral shareholder meeting minutes, board of directors meeting minutes and otherdocuments pertinent to execution of the duties of directors.
(2) Information AccessDirectors and corporate auditors shall have guaranteed access to the documents
stipulated in the preceding paragraph.
3. Systems for Regulations and Other Matters Concerning the Management of MISIGroup Loss Risk
(1) Formulation of Regulations and Systems
Risk management regulations shall be created to effectively deal with factors having
the potential to seriously affect the MISI Groupʼs future financial status andperformance, as well as factors that may impede the fulfillment of the Groupʼsbusiness. Risk management officers shall be named to oversee each major riskcategory.
Crisis management regulations shall likewise be formulated to cope with natural
disasters, epidemic calamities, terrorism, war and other threats to successful
business execution. We will use these regulations to clarify our response principles,with the highest priorities being the protection and preservation of human life,continuation of company operations and preservation of employment, as well as themanagement system when crises occur.
(2) Risk Evaluation and Monitoring① Risk management officers shall regularly review risk, arrange for proper
responses by all departments, formulate information management and monitoring
systems regarding risk and regularly reevaluate risk and other duties. Risk
management officers shall also issue regular reports on the results of evaluationsof major risks and countermeasures adopted to target those risks to theManagement Council and the board of directors.
② The Audit Department shall perform audits of the efficacy and other attributesof evaluations tracking the existing status of internal organization risks, as well asof the responses and countermeasures targeting such risks.
(3) Crisis Management Systems
We will prepare major disaster response plans, pandemic response plans andoverseas crisis management manuals. Based on these plans and manuals, eachdepartment shall formulate its own individual response plan (departmental business
continuity plan, or BCP). These plans and manuals shall be revised when deemednecessary.
4. Systems Ensuring Efficient Execution of MISI Group Director Duties(1) Management Council and Internal Committees① A management council shall be established as an advisory body to the president,
and shall deliberate about key management policies, operation planning, and othermatters within the MISI Group.
② Various internal committees shall be established, effectively positioned tocontribute to appropriate and swift decision making by the president and board ofdirectors.
(2) Business Divisions and Administrative Departments/Teams① The business division system shall be adopted, with authority delegated todivision general managers, thereby creating a system capable of reaching swift
decisions on business matters under the jurisdiction of relevant divisions both inJapan and overseas.
② Each business division shall have quantitative targets assigned to it, and regularevaluations shall be made to determine how well it has achieved those targets,
which will be used to ensure effective business management.
③Administrative departments and teams shall manage, supervise and support thebusiness divisions in each respective specialized field.
(3) Clarification of Duties, Authority and Responsibilities
Internal regulations pertaining to assignment of duties, administrative authority andmanagement of subsidiaries shall be formulated to clarify the authority andresponsibilities of each officer.
(4) Consolidated Medium-Term Management Programs
Consolidated medium-term business programs shall be formulated, incorporatingGroup-wide core management objectives, budget allocations and other measuresdetermined as necessary for putting these programs into effect.
5. System for Reporting to MISI on Matters Concerning the Execution of Duties by
Subsidiary Directors and Other Personnel
Departments in charge of subsidiaries shall be determined, with the said
departments concluding basic agreements with subsidiaries at times of defining thereplacement of heads of the department or subsidiary presidents, matters requiring
advance approval and matters that must be reported. Securing advance approvaland issuing reports regarding matters vital from the standpoint of the managementof subsidiaries shall be mandatory.
6. System Pertaining to Employees Required to Assist MISI Corporate Auditors in
Their Duties, the Independence of Such Employees from Directors and Other
Related Matters
When corporate auditors demand that certain employees be assigned to assist said
corporate auditors in their duties, studies shall first be conducted on the assignment.
When employees are assigned in this capacity, decisions shall be rendered after
attaining prior consent from corporate auditors regarding personnel matters for theemployees in question (command authority, transfers, evaluations, disciplinaryaction, etc.).
7. Systems for Reporting to MISI Corporate Auditors within the MISI Group(1) Attendance at Key Meetings

Corporate Auditors must be able to understand important decision-making
processes, as well as monitor how well directors and other personnel are executing
their duties by attending meetings of the board of directors, the management
council, various internal committees and other important gatherings, and throughaccess to related materials.
(2) Reports from MISI Directors and Employees
MISI representative directors, directors, executive officers, general managers ofadministrative departments and other personnel shall report regularly to corporate
auditors on the status of the execution of their duties. If any of the importantmatters listed below that concern the MISI Group are identified—or if reports ofsuch cases are received—those matters shall be promptly reported to corporate
auditors. Contingent upon the specific matters involved, MISI directors or executive
officers may arrange for general managers or other personnel under theirsupervision to make such reports.
- Matters violating applicable laws, regulations or the articles of incorporation- Decisions and matters discovered through internal audits that pose the risk ofexerting serious impact on finances and business- Announcements of performance or performance forecasts- Information supplied pursuant to whistleblowing- Administrative penalties- Matters requested by corporate auditors besides the above items(3) Reports from MISI Group Directors, Employees, Other Personnel
MISI group directors, employees and other personnel shall have access to thehotline contact point to directly or indirectly report issues and/or conduct related tocompliance to corporate auditors.
8. System Ensuring that Persons are not Treated Unfavorably for Submitting Reports
to MISI Corporate Auditors
Unfavorable treatment of MISI Group officers and employees making reports toMISI corporate auditors is prohibited. Awareness to this effect shall be advanced
through explicit specification in the Marubeni-Itochu Steel Group Compliance Manual.
9. Other Relevant Systems Ensuring that Audits by MISI Corporate Auditors areConducted Effectively(1) Collaboration with the Audit Department and Accounting Auditors

Corporate auditors shall receive audit plans from the MISI Audit Department andaccounting auditors in advance, while convening regular meetings and exchanging
opinions on audit policy and audit result reports.

(2) Collaborations with MISI Group Corporate Auditors
Corporate auditors shall engage in information exchanges from time to time withthe corporate auditors at subsidiaries when deemed necessary to solicit opinions on
the execution of duties at subsidiaries.
(3) Audit Costs① In cases in which corporate auditors determine the budgets for covering audit
costs, budgeting shall be conducted pursuant to those costs being specified.
② Regarding urgent or special expenditures deemed necessary by corporate
auditors, if there are demands for prepayment, repayment or other procedures,processing shall be performed promptly pursuant to the stipulations of Article 388of the Companies Act.

Measures shall be taken to improve this internal control system on the strength ofongoing reviews to produce more appropriate and efficient schemes. The internal
control administration team shall coordinate this work.