Corporate Governance Report<TRANSLATION>

September 2, 2024

Toyota Tsusho Corporation
President＆CEO: Ichiro Kashitani
Contact: +81-52- 584-5491
Securities Code: 8015
https://www.toyota-tsusho.com/english

Corporate governance at Toyota Tsusho Corporation (the “Company”) is as follows:
I. Basic Policies for Corporate Governance, Capital Structure, Corporate Attributes
and other Basic Information
1. Basic Policy (Updated)
In the Toyota Tsusho Group’s Fundamental Philosophy, the Toyota Tsusho Group (the“Group”) has set forth the corporate philosophy “Living and prospering together withpeople, society, and the Earth, we aim to be a value-generating corporation that
contributes to creation of a prosperous society.” The Group has instituted the Behavioral
Guidelines as a fundamental code of conduct for legally and appropriately realizing thisphilosophy as a good corporate citizen.
In keeping with this Fundamental Philosophy, the Company has instituted the Basic
Policies on Establishing Internal Control Systems for the purpose of carrying on anddeepening penetration of the Toyota Tsusho DNA, which articulates the Group’s uniquevalues, beliefs, and daily principles of conduct, of promoting value creation from thecustomer’s perspective, and of fulfilling the Group’s social mission by establishing a“system for ensuring the appropriateness of the Company’s operations.”
On the basis of this fundamental philosophy, the Company will actively promote further
management efficiency, transparency, rigorous compliance, and financial soundness.
In addition, the Company will further enhance its public relations and investor relations
activities to promote wider understanding of the Group.

[Reasons for not implementing each principle of the Corporate Governance Code]

The Company implements each principle of the Corporate Governance Code including
for the Prime Market.

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Corporate Governance Report<TRANSLATION>[Disclosure based on each principle of the Corporate Governance Code][Principle 1.3]
The Company's dividend policy is to pay progressive dividends and achieve a payout
ratio of 30% or more for the fiscal years ending March 31, 2024 through March 31,
2026. In addition, the Company will consider agile payment based on the cash flow
trends. The Company intends to use internally retained earnings to further enhance andstrengthen its operational foundation and invest in business expansion to ensure future
shareholder returns.

[Principle 1.4]
・Policies on strategic shareholdings
Maintaining and strengthening business relationships and cooperative relationships
with a wide variety of companies is necessary for sustained enhancement of theCompany’s corporate value. The Company strategically holds limited shares ofinvestment companies that are considered －from a medium- to long-term perspective－ to be beneficial and important as significant business/collaborative partners. When
conducting reviews into whether the Company ought to continue holding its crossshares and the number of the cross shares it holds, the Company will comprehensively
consider profitability using self-devised cost-of-capital-based indicators and matters,such as establishing, maintaining, and strengthening business relationships with thepartners concerned, contributing to and cooperating with regional and social
development, and other factors. The results of the reviews of continued ownership andthe number of shares held shall be reported during the Board of Directors meeting oncea year. The Company will reduce its holdings of cross shares when it is found that there
are no grounds to continue holding them.
In the fiscal year ended March 31, 2024, we reduced 59 issues (balance sheet amountin the fiscal year ended March 31, 2023: 39.3 billion yen in total), excluding nine issues
that were partially sold, etc.
・Policy on the exercise of voting rights
Striving to maintain and strengthen partnership with investee companies, the Company
engages in communications with these companies that contribute to enhancement of
their shareholder interests and corporate value over the medium and long term. The
Company’s departments that manage investments take that perspective andappropriately exercise voting rights on the basis of multifaceted and comprehensive
consideration of the situation of each investee company.

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・Policy for when cross-shareholders (i.e. shareholders who hold a Company’s sharefor the purpose of cross-shareholding) indicate that they want to sell the sharesIf cross-shareholders seek to sell the shares, the Company will not hinder the sale ofthe cross-held shares. In such a case, if the Company has their shares for the purposeof cross-sharing, the Company will take appropriate measures to reduce those sharesin accordance with the Company’s policies on cross-shareholdings.

[Principle 1.5] [Supplementary Principle 1-5-1]
The Company presently has no plans to adopt takeover defense measures. If it wereto do so in the future, it would adopt only measures it deems reasonable and necessary
and fully explain them to shareholders.

[Principle 1-6]
The Company presently has no plans to adopt any capital policies that would result ina change in control of the Company or substantially dilute existing shareholders. If it
were to do so in the future, it would adopt only policies it deems reasonable andnecessary and fully explain them to shareholders.

[Principle 1-7]
The Company complies with the procedures set forth in the Companies Act concerningtransactions involving the conflict of interest of directors and competitive transactions
by directors. All transactions with non-director executive officers require both theapproval of the President and reporting to the Board of Directors based on our
Regulations of Board of Directors. Through such a requirement, the Company believes
that these transactions are adequately supervised by the Board of Directors.
In transactions between the Company and the Company’s major shareholders or otherrelated parties, the Company decides price and other terms and conditions on the basisof individual negotiations, as in the case of ordinary transactions, approves transactionsin accordance with internal rules, and endeavors to ensure that related-party
transactions do not harm the interests of the Company or the common interests of allshareholders.

[Supplementary Principle 2-4-1](1) Our approach to securing diversity
The Group is convinced that its effort to respect, embrace, and actively utilize diversity

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will lead to an increased superiority of the entire group. We aim to build a strongorganization while promoting diversity・equity and inclusion (DE&I) as a management
strategy, letting each of diverse employees exert his/her ample individuality as a strong
individual, and having them influence each other and evolving together. Moreover, we
continue to get personnel equipped with diverse individuality and experience to perform
well as our core human resources such as managerial staff, by ensuring to select,develop, evaluate, and promote personnel according to each individual’s skills
regardless of his/her attributes. This approach is disclosed in our official website:
Sustainability_Social_Promoting Diversity_Basic Policy（https://www.toyota-tsusho.com/english/sustainability/social/diversity.html)(2) Set measurable goals and disclose the execution status
Shown below are voluntary and measurable goals for securing diversity on anonconsolidated basis, coupled with the execution status.
① Promote female employees to managerial positions
Currently (as of April 2024), female employees account for 32% of our entire staff.
Proportion of females in managerial positions has risen from 5.4% five years ago to
8.4%. There has been an increase in female overseas-posted employees, line generalmanagers and group leaders, and we have one female senior executive officer and one
female executive officer. We will step up the effort to promote female empowerment
while aiming to raise the female manager ratio to 10%
by April 2025.
② Promotion of non-Japanese employees to managerial positions
Currently (as of April 2024), 88 non-Japanese employees serve the Company, which isactively recruiting new graduates and mid-career workers who are non-Japanese. We
will continue to assist and develop recruited non-Japanese employees so that they will
perform well as our core human resources such as managerial personnel.
③ Strengthen recruited mid-career employees（※）
Mid-career employees now account for approximately 50% of workers recruitedannually (as of April 2024). The Company, having been boosting its mid-career
recruitment for new key domains constituting its entity-wide strategy, will continue hiring
mid-career workers more or less to a similar extent and utilize their diverse experience.
※Excluding rehires and transfers from outside the company(3) Human resources development policy and internal environment streamlining policy
To help expand opportunities for diverse employees to perform well, the Group4

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introduces a human resources system that assists work–life balance and work stylereform and makes diverse career paths happen. We also foster an environment andcorporate culture that lets diverse employees work lively while raising individual
employees’ awareness. To continue these efforts, we have in place a platform in which
divisional CEOs set annual DE&I endeavor goals and report their progress andachievements at a meeting of officers and Board of Directors. In the coming years, tobe able to generate a value unique to the Company and grow sustainably, we willdevelop the environment and human resources in a manner that enables diverse
employees to maximally exert their characteristics and skills as strong individuals.

Work–life balance assistance and work style reform:（https://www.toyota-tsusho.com/english/sustainability/social/working-env.html)
Human resources system and human resource development:（https://www.toyota-tsusho.com/english/sustainability/social/hr-activity.html)
External evaluation: Earned Platinum Kurumin certification and Eruboshi (Certification
Stage 2) certification（https://www.toyota-tsusho.com/english/sustainability/social/diversity.html)[Principle 2.6]
To enable corporate pension funds to perform the functions expected of them as asset
owners, the Company allocates to the fund secretariat human resources suitable forcarrying out asset management, etc. and has out in place an Asset Management
Committee in which the heads of the Finance Department, Accounting Department, andGlobal Human Resources Department participate as members. The AssetManagement Committee deliberates on matters concerning fund management status,
asset distribution, and future fund management policy. The Asset Management
Committee, through its deliberations, confirms whether fund management is being
implemented in accordance with the Basic Fund Management Policy and whether it isbased on diversified investment conducted from a medium- to long-term perspective.
The Company has also appointed an external consulting firm to complement internal
professional expertise and knowhow while also － by providing an independent
perspective － helping to prevent conflicts of interest between the Company andbeneficiaries of the pension funds.

[Principle 3-1 (i)]The Company discloses the corporate philosophy, vision, mid-term business plan, and5

Corporate Governance Report<TRANSLATION>

other information on the corporate website.
https://www.toyota-tsusho.com/english/company/vision.html[Principle 3-1 (ii)]
Please see “I. 1. Basic Policy” of this report.

[Principle 3-1(iii)]
・Decision policy and decision process
Compensation for directors of the Company shall consist of (i) fixed remuneration as
basic compensation, (ii) bonuses(short-term incentives) as performance-linked
compensation, and restricted stock compensation (medium- to long term incentives).
The ratio of fixed remuneration to performance-linked compensation is determined witha target ratio of 50:50. For performance-linked compensation, the ratio of “bonus” to“restricted stock compensation” shall be determined at a ratio of 70:30. The directors
are responsible for the final profit (including temporary and incidental gains/losses) of
all Group companies, the amount of performance-linked compensation paid in eachfiscal year shall be determined for each position with the consolidated profit (attributableto owners of the parent company) for the previous fiscal year as an indicator. However,outside directors are independent from the operational management, therefore, they
are paid fixed remuneration only, and not paid bonuses and restricted stockcompensation. Audit & Supervisory Board members are also paid fixed remuneration
only because they are independent so that they carry out audits appropriately.
The Company has established an Executive Compensation Committee as an advisory
body to the Board of Directors, with the majority of the committee members being
independent outside directors. The committee is chaired by the Chairman of the Board,
who has no representative authority and is not involved in operational management.
The Executive Compensation Committee shall deliberate on the policy for determining
the details of compensation for each director (hereinafter, the “Policy”), the director
compensation system, director compensation proposals to be submitted to the General
Meeting of Shareholders, and other important matters concerning director
compensation. The Board of Directors shall determine the Policy, the proposal on officer
compensation (bonuses for officers) to be presented to the General Meeting of
Shareholders, and the compensation for each Director in relation to restricted stockcompensation, taking into account the result of such deliberations. The Board of
Directors shall delegate the decision to the President & CEO from the standpoint offlexibly and agilely deciding the amount of compensation for each Director in relation to6

Corporate Governance Report<TRANSLATION>

fixed remuneration and bonuses. The President & CEO shall determine the amount ofcompensation for each director in accordance with the Policy, taking into accountopinions gathered during interviews with each member of the Executive Compensation
Committee. The Board of Directors deems the compensation, etc. of each director forthe current fiscal year is in line with said decision policy, having confirmed that it isconsistent with the Policy determined at the Board of Directors’ meeting, and that thefindings of the Executive Compensation Committee have been given due regard.
・Method of deciding on compensation
The following is an outline of the components of compensation for directors (excludingi) Fixed remuneration
Fixed remuneration shall be monthly compensation and shall be set at an appropriate
level with reference to the remuneration data of other companies in the industry andtaking into consideration the position and responsibilities of each director.
ii) Bonuses
For each fiscal year, the Company shall determine the amount of bonuses to be paid
to each individual by adjusting, as appropriate, 70% of the total amount of the specified
performance-linked compensation for each position based on the responsibilities of theposition and the performance of the duties for which the individual is responsible.
iii) Restricted stock compensation
For each fiscal year, the amount of restricted stock compensation to be paid to eachindividual shall be determined by adjusting, as appropriate, 30% of the total amount of
performance-linked compensation specified for each position based on the
responsibilities of the position and the performance of the duties for which the individual
is responsible. However, in cases where it is not appropriate to grant restricted stockcompensation to Eligible Directors, the full amount of the performance-linked
compensation for Eligible Directors shall be paid as a bonus.

The transfer restrictions on transfer-restricted stock compensation for a director are
lifted on a day on which he/she resigns from the Company. Compensation to beprovided to target directors to grant transfer-restricted shares to them will be monetaryclaim, the total value of which will be not more than 200 million yen a year as a limit
separate from the aforementioned fixed remunerations and bonuses for directors. The
class of stock to be allocated will be common shares (those for which transfer restriction
is imposed in an allocation agreement). The total number of shares to be issued or7

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disposed of will be not more than 200,000 shares a year for target directors (as resolvedby the Ordinary General Meeting of Shareholders of June 23, 2020). Specific timing ofprovision and allocation to individual target directors will be determined by the Board of
Directors on the basis of deliberations by the Executive Compensation Committee.
・Only fixed remuneration is paid to Audit & Supervisory Board members in light of theirrole of appropriate auditing from an independent position. With respect to fixed
remuneration for Audit & Supervisory Board members, the 2014 Ordinary General
Meeting of Shareholders approved a payment limit of 16 million yen per month, andamounts for individual Audit & Supervisory Board members are decided by conferencewith the Audit & Supervisory Board within this remuneration limit. Executive retirement
benefits are not paid to all directors and Audit & Supervisory Board members.

[Principle 3-1 (iv)]
・Policies
The Company defines its top management as being inside directors excluding the
Chairman of the Board, Division CEOs, and Regional CEOs. When appointing senior
executives, the Company comprehensively considers and appoints the right person for
the right position that will enable appropriate and prompt decision-making at each role.
The Company considers appointments of outside officers in accordance with therequirements set forth in the Companies Act and the independence standards
established by financial instruments exchanges. Further, the Company has stipulated
criteria for the dismissal of top managements in its internal regulations and suchconsiderations are made in accordance with these regulations.
・Procedures
In its consideration of director nominations, the Company has established the Executive
Appointment Committee, at which independent outside directors make up the majority,
to consider the appointment or dismissal of top managements and makerecommendations to the Board of Directors as reference for resolution.
Audit & Supervisory Board members are appointed by resolution of the Board of
Directors after consultation of Audit & Supervisory Board.

[Principle 3-1 (v)]The reasons for the election of individual directors and Audit & Supervisory Board
members are described in the election proposals in the Reference Materials for the8

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General Meeting of Shareholders.
For details, please refer to the Notice of Ordinary General Meeting of Shareholders
posted on the corporate website.

[Supplementary Principle 3-1-3]
We identified Key Sustainability Issues [Six Materiality] that it will address with priority.
1.Strive for the elimination of traffic casualties and contribute to the creation of a safe
and comfortable mobility society
2.Contribute to the transition to a carbon neutral society by reducing CO₂ emissions
from automotive, manufacturing, and energy plant construction through the use of clean
energy and innovative technologies.
3.Contribute to the development of a recycling-based society by transforming waste
into resources for manufacturing.
4.Grow with developing countries, including those in Africa, and endeavor to resolve
social issues through business operations.
5.Begin everything we do with ensuring safety and compliance and continue to be anorganization trusted by society.
6.Respect human rights, and actively develop people who will contribute to society by
nurturing them and giving them opportunities to apply their skills.

With the mission of “Passing on a better global environment

to the children of the

future" We have established six priority Businesses(Next mobility , Renewable energy,
Africa, Circular Economy, Batteries, Hydrogen/Alternative Fuels) and Economy of Life
Business as a plus extra business in line with the above-mentioned materiality in orderto realize a prosperous society through our business.
Deeming

climate change as a significant business challenge, we expressed support

for TCFD in May 2019, have been providing disclosure in accordance with theframework, and will step up the endeavors further.

In July 2021, as a specific policy to contribute to a shift to a decarbonized society, theToyota Tsusho Group established a goal of i) reducing greenhouse gas emissions fromits business activities in Scope 1 and Scope 2 of the nonconsolidated operations andconsolidated subsidiaries in and outside Japan by 50% by 2030 in comparison with thatin 2019 and ii) achieving carbon neutrality by 2050. The Group aims to achieve the goalby working to i) continue thorough energy-saving efforts and use of renewable energy
sources (shift to LED at office and plants, and solar power generator installation at its

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buildings), ii) reduce carbon dioxide emissions in production processes and logistics,iii) lower such emissions via technological innovation, and iv) use J-credit derived fromrenewable energy sources.

As one of our key sustainability issues toward achieving our vision (Global Vision), we
expressed an intent to respect human rights, and actively develop people who willcontribute to society by nurturing them and giving them opportunities to apply theirskills, and are working to grow professionals able to perform well globally. Each year,
the Global Human Resources Committee deliberates on a task assignment-based
short-to-medium-term development plan particularly for successor candidates for highly
important posts under our business strategy. Moreover, we provide them with
opportunities to grow through internal and external training courses.
Reference URL for our official website(https://www.toyota-tsusho.com/english/sustainability/social/hr-activity.html)[Supplementary Principle 4-1-1]
The following matters require judgement and resolution by the Board of Directors.
・Matters stipulated
・Matters delegated to the Board of Directors by resolution of the General Meeting of・Other important business matters.
Other matters are delegated to each director and the progress is reported to the Boardof Directors as appropriate according to their degree of importance to the business. To
allow its Board of Directors to devote more time to discussion, the Company raisedsome monetary thresholds for investments/expenditures requiring Board approval andnarrow down the items to be reported.

[Supplementary Principle 4-2-2]
The Toyota Tsusho Group’s corporate philosophy of “living and prospering together withpeople, society, and the globe, we aim to be a value-generating corporation that
contributes to creation of a prosperous society” is deemed to be a paramount conceptthat will remain unchanged perpetually and must be handed down generation aftergeneration. Thus, we have been raising our corporate value though engaging inbusiness activities in ways friendly to the global environment and developing
professionals who contribute to society.

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While putting into practice our corporate philosophy that expresses our resolve to workon management, sustainability for the Group is its business management itself and isdefined as an act to present its significance of existence and its desirable state,
generate economic value, premised on the environment and society, and to keep
growing together with society in a sustained manner.

The Toyota Tsusho Group has specified key sustainability issues (materiality) as ones
to be addressed in a prioritized fashion while pursuing sustainability management. We,
the Toyota Tsusho Group, will contribute to resolving social issues and creating aprosperous society in the future.

[Principle 4-9]
The Company has determined the independence of Outside Members of the Board andOutside Audit & Supervisory Board Members based on their backgrounds andrelationships with the Company, with reference to the independence rules stipulated bydomestic stock exchanges, on the premise that they can reflect their wealth ofexperience, advanced professional knowledge, and wide-ranging insights in the
Company’s management and are able to actively and constructively offer theirsuggestions and views about enhancing the Company’s corporate value over the
medium and long terms from a fair and neutral position.

[Supplementary Principle 4-10-1]
The Company has in place of the Executive Appointment Committee and the Executive
Compensation Committee as advisory bodies to the Board of Directors. The Executive
Appointment Committee deliberates on the policy on the election and dismissal of theMembers of the Board, Audit & Supervisory Board Members, and management
executives and on proposed appointments, formulates and executes a plan to develop
potential CEO successors, and deliberates on other important matters associated withexecutive appointment. The Executive Compensation Committee deliberates on thepolicy for determining the details of compensation for each individual director of theCompany, the compensation system for directors, proposals on the compensation for
directors to be submitted to the General Meeting of Shareholders, and other importantmatters related to the compensation for directors and corporate officers. On the basisof the deliberation results, the Board of Directors resolves the proposed executive
appointments and executive compensations. The Executive Appointment Committee
and the Executive Compensation Committee are each chaired by the Chairman of the11

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Board who neither has representation right nor is involved in our business execution.
These committees’ independence is secured as the majority of the committee members
are accounted for by independent outside directors equipped with diverse experience.
The committees provide the Board of Directors with appropriate advice on gender andother diversity issues as well as from a skill perspective, thereby reinforcing theindependence, objectivity, and accountability of the Board.

[Supplementary Principle 4-11-1]
The Company selects its directors from inside and outside the Company who have a
wealth of experience, advanced professional knowledge, and wide-ranging insights so
as to develop a system in which decision-making and oversight of management andexecution are appropriately performed.
The Company comprehensively deliberates the members of the Board of Directors fromthe perspective of enabling appropriate and prompt decision-making and appointing theright person for the right position according to individual roles. The Board of Directors
currently consists of a total of eight directors, including three independent outside
directors.
The Company has appointed one person who has appropriate knowledge of financeand accounting as Audit & Supervisory Board members. The Audit & Supervisory Board
currently consists of five members, including three independent outside auditors, who
audit and check officers’ business execution from an objective and professional
perspective.
Please refer to the end of this report for the combination of abilities and experiences
possessed by the directors and auditors of the Company.
Please see “Principle 3-1 (iv)” of this report regarding policies and procedures for theselection and appointment of directors.

[Supplementary Principle 4-11-2]
Concurrent service of directors and Audit & Supervisory Board members as officers ofother listed companies is noted in the Notice of Ordinary General Meeting of
Shareholders.

[Supplementary Principle 4-11-3]
In order to improve the effectiveness of the Board of Directors, the Company conducts
an analysis and evaluation of the Board of Directors, and reports the findings to theBoard of Directors every year.

The outline of analysis and evaluation of the Board of12

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Directors for FY2023 is below.
<<Outline of Evaluation>><Individuals Surveyed>
All 8 Members of the Board and all 5 Audit & Supervisory Board members<Survey Method>
Questionnaire survey<Matters Evaluated>
・Board composition, operation, proposal/deliberation processes, etc.
<Evaluation Results>
・The Company conducted a director effectiveness evaluation targeting Members of
the Board and Audit & Supervisory Board Members for fiscal 2023.The collected survey
responses were generally positive across all of the matters evaluated, confirming thatthe Board of Directors is functioning effectively.

The survey confirmed that progress has been made over the past year as regards
addressing issues identified in the evaluation for the fiscal year ended March 31, 2023
through initiatives, such as the review of the criteria for the amount to be submitted to
the Board of Directors and raised the criteria in line with the expansion of theCompany’s business, report on the progress of matters pointed out in the report fromthe Audit & Supervisory Board at the respective Board of Directors’ meetings, anddialogue meeting with the Sales Division used as a forum for consultation to address
problematic businesses and topics that are difficult to bring to the forefront in eachdivision. The long-term vision and business model are also explained with respect tothe competitive landscape. The Board of Directors’ meetings are held outside of theCompany for site inspections, and planned on-site inspections at key locations areproposed. The Company will continue to make progress on these issues.

Meanwhile, in response to issues identified by the evaluation for the fiscal year ended
March 31, 2023, the Company will endeavor to further increase the Board of Directors’
effectiveness by (1) continuing and expanding discussions on themes important to theCompany's management in “Management Discussions on Big Themes” (*), (2)expanding reports on human capital management and other topics at the Board of
Directors’ meetings, (3) reporting on the direction to be taken under the neworganizational structure and other topics at the dialogue meetings between the Sales
Division and the Outside Members of the Board, and (4) including investor opinions
obtained through IR activities, consequently enhancing information sharing on IR

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activities.
*A meeting after the Board of Directors’ meeting, during which the Members of the Board and the Audit &Supervisory Board Members freely and openly exchange opinions on major management issues.

[Supplementary Principle 4-14-2]
・The Company appropriately provides the elected members of the Board of Directors
and Audit & Supervisory Board with information necessary for them to fully perform theirfunctions. The Company also provides opportunities for directors and Audit &Supervisory board members to participate, at Company expense, in seminars, training,
etc. conducted by third-party organizations necessary for the performance of theirduties.
・In addition to providing orientation for newly appointed outside officers, the Company
continuously arranges opportunities for them to understand the business activities of
the Company and the Group, such as inspecting the actual situation on-site (Genchi
Genbutsu) by visiting the Company’s principal business entities and holding dialogues
with employees.
・At least once a year, the Company holds Executive Review Meetings in which insideand outside officers participate. At the meetings, an intensive review of recent
management issues is conducted, and information necessary for the performance of
duties is provided.

[Principle 5-1]
The Board of Directors has approved the following policy.
Policy for development of systems and measures to promote constructive dialogue withshareholders(i) The Company has appointed an executive officer of public affairs and an executive
officer of investor relations.
(ii) The Company has formed a task team for the purpose of organic collaboration that
supports dialogue.
(iii) General Meeting of Shareholders: The Company provides easy-to-understandexplanations of the Company’s business, organization, etc. and conscientiously
answers questions from shareholders.
Individual investors: The Company regularly makes presentations at IR events andprovides explanations of the Company.

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Institutional investors: The Company holds quarterly results briefings.
Overseas investors: The Company provides explanations of the Company at forums
held in Japan and meets regularly with major shareholders.
(iv) Feedback on shareholder opinions and concerns is provided to top managements
as necessary.
(v) Insider information is appropriately managed in accordance with the Insider Trading
Control Regulations instituted by the Company.

[Principle 5-2]
The Company discloses the mid-term business plan and other information on thecorporate website.
https://www.toyota-tsusho.com/english/ir/management/plan.html[Supplementary Principle 5-2-1]
In formulating the business portfolio, the Board of Directors monitors the Progress
Report for Execution of Operation of each sales division, and after the Board of
Directors, Business Policy Briefing Session between outside director and auditor andeach sales division and Management Discussions on Big Themes are held. Moreover,
we hold Mid-Term Business Plan Meeting every March to discuss Toyota Tsusho Groupwide annual plans and medium-term management plans. After sharing detail of theplans with outside director and auditor, the Board of Directors of the same monthresolved policies and strategies regarding the business portfolio. Based on the content
of the resolution, the basic policy is disclosed to the outside by investor relations
activities.
【Actions to achieve cost of capital and stock price conscious management】
We use Toyotsu Value Achievement (TVA), an indicator that measures the value added
beyond the expected rate of return (cost rate of invested capital) required for invested
capital (funds used), for monitoring the performance of divisions and business units andas a quantitative evaluation indicator for investments.
The cost rate of invested capital, which is the weighted average of the cost ofshareholders’ equity and debt, is designed to be based on the return on equity (ROE)target. Thus, a positive or better TVA through improved asset efficiency and profit
growth will lead to the achievement of the ROE target. In addition, we set our point ofview in accordance with our global business operations by making adjustments
according to country risk.

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We aim to steadily increase our corporate value by seeking improvements throughinvestment and performance monitoring in divisions and business units whereindicators comprising TVA have deteriorated, and by discussing measures to return TVA
to profitability or improve it in discussions on new investments.
Website: Investment Cycle Management
https://www.toyotatsusho.com/english/sustainability/governance/riskmanagement.html<TVA Analysis, “Examples of On-site Capital Cost Conscious Initiatives”>
Please refer to the end of this report.
【Status of Dialogues with Shareholders, etc.】
We actively engage in dialogue with our shareholders and investors to contribute toour sustainable growth and medium- to long-term enhancement of corporate value.
For details, please refer to “III Implementation for Measures for Shareholders andOther Stakeholders.”(i) Main respondents
ESG briefings and small meetings: President, CFO, and CSO
Results briefings and individual dialogue: CFO, Assistant to CFO, and dedicated IR
department(ii) Summary of shareholders and investors with whom we had dialogues with
Conducted 283 dialogues with domestic and foreign institutional investors(iii) Main themes and concerns in the dialogues
Growth and financial strategies, shareholder return, cost of capital conscious
management, etc.
(ⅳ) Status of feedback to management and the Board of Directors on shareholder
opinions and concerns identified in the dialogue
The status of the dialogues at the results and ESG briefings is summarized.
Feedback is provided through reports to the Board of Directors.
(v) Matters incorporated based on dialogue and subsequent feedback, etc.
Update shareholder return policy

2. Capital Structure
Percentage of shares held by overseas
investors

16

20 % or more, less than 30 %Corporate Governance Report<TRANSLATION>[Principal Shareholders]Name

Number of Shares Held

Percentage(％)

Toyota Motor Corporation

76,368,939

21.69

The Master Trust Bank of Japan, Ltd.

49,122,300

13.95

Toyota Industries Corporation

39,365,134

11.18

Custody Bank of Japan, Ltd. (Trust

19,800,953

5.62

MUFG Bank, Ltd.

8,098,635

2.30

Sumitomo Mitsui Banking Corporation

4,249,589

1.21

STATE STREET BANK WEST CLIENT

4,193,059

1.19

Nippon Life Insurance Company

3,522,468

1.00

Kochi Shinkin Bank

3,265,000

0.93

TOYOTA FUDOSAN CO., LTD

3,205,950

0.91(trust account)

Account)

TREATY 505234

Controlling shareholders (except parent

None

company)

Parent company
StockexchangeNonelistingsofparentNone

company

Supplemental Remarks

Note: 1. The major shareholders as abovementioned are as of March 31, 2024.
Note: 2. The percentage of shareholding is computed excluding 1,967,115 shares oftreasury stock.
Note: 3. A large shareholding report dated January 15, 2024 was submitted by
Mitsubishi UFJ Financial Group stating that 18,089,890 shares (shareholding ratio:
5.11%) were held by three joint holders, including Mitsubishi UFJ Bank, Ltd., as ofJanuary 8, 2024. However, we are unable to confirm the status of the actual
shareholdings as of March 31, 2024. Therefore, it is not included in the above list ofmajor shareholders.

3. Corporate Attributes

17

Corporate Governance Report<TRANSLATION>

Stock exchange listings

Tokyo Stock Exchange (Prime Market),
Nagoya Stock Exchange (Premier Market)

Fiscal year end

March

Industry

Wholesale trade(Consolidated) Number of Employees

Over 1,000(Consolidated) Net Sales

Over JPY 1 trillion

Number of consolidated subsidiaries

Over 300

4. Policies rerating to measures for protecting minority shareholders when
conducting transactions etc. with controlling shareholders
None

5. Other Special Items Exerting a Significant Impact on Corporate Governance<Listed Subsidiaries and Affiliated Companies>
1. Our policy on group management and significance of owning listed
subsidiaries

The Company owns Tomen Devices Corporation (Prime Market of the Tokyo Stock
Exchange) and Elematec Corporation (Prime Market of the Tokyo Stock Exchange) as
listed subsidiaries.
Our corporate philosophy says that living and prospering together with people,
society, and the globe, we aim to be a value-generating corporation that contributes tocreation of a prosperous society.
Toward maximizing the corporate value of the entire Company group under thiscorporate philosophy, we think that it is highly significant to own Tomen Devices
Corporation, which is strong in marketing function as a world-class distributor for
semiconductor manufacturers, and Elematec Corporation, which is strong in site skills
catering for diverse customer needs due to having networks in countries around theworld and in locations in Japan. In our view, to keep these firms listed to respect theirautonomy and independence will contribute to synergy within the Company group to
expand our operations, considering competition and market conditions in the businessdomains for these listed subsidiaries.

2. Governance system and effectiveness securement at listed subsidiaries

To ensure that the Company group’s operations are efficient and transparent to make18

Corporate Governance Report<TRANSLATION>

its governance system effective, the Company works to ensure compliance and put its
financial position on a sound footing under its Audit & Supervisory Board system anddivisional consolidated business administration while endeavoring to optimize ourconsolidated operations, such as by sharing our corporate philosophy and businessstrategies. We strive to ensure that the duty execution by listed subsidiary directors,
etc. is compliant with laws and the Articles of Incorporation by dispatching directors andthe Audit & Supervisory Board members to Tomen Devices Corporation and Elematec
Corporation to have them supervise and audit such execution.
Aside from having the rules of Tomen Devices Corporation and Elematec Corporation
clarify approval authority at them, the Company attaches importance to their autonomy
and independence. With six independent officers elected by Tomen Devices
Corporation and five independent officers elected by Elematec Corporation, they
ensure autonomy and independence of the Board of Directors to prevent any conflictof interest with minority shareholders by having independent officers audit andsupervise duty execution by the directors. Furthermore, both Tomen Devices
Corporation and Elematec Corporation have established special committees asadvisory bodies to the Board of Directors to protect minority shareholders.

3. Framework to ensure the appropriateness of operation at the Company group

The Company exercises its shareholder rights at a general meeting of shareholdersof listed subsidiaries and affiliated companies while ensuring to clarify approvalauthority at the subsidiaries and the companies, with rules laid down by them, and to
attach importance to their autonomy and independence.
Although various business transactions are entered into between the Company andits listed subsidiaries and affiliated companies, prices and other transaction terms andconditions are determined similar to those for ordinary transactions through individual
negotiations. The relationship and transactions between them have nothing that limits
their independence.

<Other Affiliated Companies>

Toyota Motor Corporation, a major shareholder of the Company which holds 21.8%of voting rights, falls under the category of "other affiliated companies.”
The Company is a member of the Toyota Group, which consists of Toyota Motor
Corporation and its corporate group, but is not restricted in its business by this fact. The

19

Corporate Governance Report<TRANSLATION>

Company has transactions with Toyota Motor Corporation, including the sale ofproducts handled by the Company and the purchase of products from Toyota Motor
Corporation. Prices and other transaction terms are determined in the same manner as
general transactions through individual negotiations, and the Company endeavors toensure that transactions with Toyota Motor Corporation do not harm the common
interests of the Company and its shareholders.
In addition, the Company's approval authority is clearly defined in its internal rules,
and there is no involvement of major shareholders in the Company's decision-making
process. Furthermore, the Company has appointed three independent outside directors
and three independent outside Audit & Supervisory Board members to ensure that there
are no conflicts of interest with minority shareholders through the supervision andauditing of the directors’ performance of their duties by independent officers. The
Company also ensures independence in the appointment of directors and executive
officers through deliberations by the Executive Appointment Committee, in which the
majority of members are independent outside directors.

20

Corporate Governance Report<TRANSLATION>

II.

Organizational

StructureforManagerial

Decision-Making,Execution,

Supervision and other Corporate Governance Structure
1. Organizational Structure and Operational Management
Type of Organization

Company with Audit & Supervisory Board[Board of Directors]

Number of directors stipulated in Articles

No maximum limitationof Incorporation
Directors’ term of office stipulated in

1 year

Articles of Incorporation
Chairperson of the Board of Directors

Chairman of the Board (unless double as
the President)

Number of directors

8

Appointment of Outside Directors

Yes

Number of Outside Directors

4

Number of Outside Directors designated3

as Independent Director

Relationship with the Company (1)NameAttribute

Relationship with the Company*a

Didier Leroy

From another company

Yukari Inoue

From another company

Chieko Matsuda

From another company

Goro Yamaguchi

From another company

b

c

d

e

f

△

g

h

i

j

k

△

〇

* Categories for relationship with the Company
Ԃ“△”when the said individual fell under each of the following categories in the past.
“●”when a close relative of the said individual presently falls or has recently fallen under each of theԂ

l fell under each of the following

categories in the past.
a. Executive of a listed company or its subsidiaryb. Executive of non-executive director of the parent company of a listed company
c. Executive of a fellow subsidiary company of a listed company
d. The party whose principal client or supplier is a listed company or executive thereof
e. Principal client or supplier of a listed company or executive thereof21

Corporate Governance Report<TRANSLATION>

f. Consultant, accountant or legal professional who receives a large amount of monetary consideration or other property
from a listed company besides compensation as an executive
g. Principal shareholder of a listed company (executive of the said corporate shareholder if the principal shareholder isa legal entity)
h. Executive of a client or supplier company of a listed company (which does not correspond to any of d, e, or f, above)(the said individual only)
i. Executive of a company, between which and the Company outside directors are mutually appointed (the said individual
only)
j. Executive of a company or organization that receives a donation from a listed company (the said individual only)
k. Other

Relationship with the Company (2)Name

Independent

Supplemental information

Reason for selecting as

directoron corresponding items

outside director (andreason for appointing as
independent director )Didier
Leroy-

Over a period of 5 years

Mr. Didier Leroy served asfrom June 2015 to Junethe Director of Toyota

2020, Mr. Didier Leroy

Motor Corporation and its

served as the Director ofaffiliated companies. He

Toyota Motor Corporation,

has a wealth ofa major shareholder andmanagement experiencebusiness partner of the

as a corporate executive

Company. Presently, heand a high level ofserves as the Chairman ofexpertise in global

Toyota Motor Europe

companies, especially the

NV/SA, a consolidated

automotive industry.

subsidiary of Toyota Motor

The Company has re-

Corporation. Althoughnominated Mr. Leroy as avarious businesscandidate for outsidetransactions are done

director because it believes

between the Company andthat he is capable ofToyota Motor Corporation

providing advice on the

and/or Toyota Motor

overall business andEurope NV/SA, themanagement of theCompany decides on

Company and supervising22

Corporate Governance Report<TRANSLATION>

prices and otherthe execution of duties bytransaction terms anddirectors.

conditions throughindividual negotiations asin the case of ordinarytransactions.
Yukari

○

-

Inoue

Ms. Yukari Inoue holds
abundant management
experience at global
companies, including being
Managing Director of
Kellogg Japan G.K. She
has a wealth of experience
as a corporate executive
and an advanced expertisein a global company inconsumer business.
The Company has renominated Ms. Inoue as a
candidate for outside
director because it believes
that she is capable ofproviding advice on theoverall business andmanagement of theCompany and supervising
the execution of duties bydirectors. Ms. Inoue does
not have a conflict with theindependence standards ofthe domestic stock
exchange. In addition, Ms.
Inoue has been designatedas an independent officer
because there is no conflictof interest with general23

Corporate Governance Report<TRANSLATION>

shareholders, and there isno business relationship orother special interests
between the Company and
Ms. Inoue or Kellogg
Japan G.K., for which Ms.
Inoue serves as theManaging Director, and theCompany.
Chieko○-MatsudaMs. Chieko Matsuda has
experience at a bank andcredit rating agency and in
the field of research and as
an outside director of an
operating company. She
has a wealth of experienceand a high degree ofexpertise, particularly inthe areas of corporate
management, finance, andcorporate governance. The
Company has renominated Ms. Matsuda asa candidate for outside
director because it believes
that she is capable ofproviding advice on theoverall business andmanagement of theCompany and supervising
the execution of duties bydirectors. Ms. Matsuda
does not have a conflictwith the independence
standards of the domestic
stock exchange. In

24

Corporate Governance Report<TRANSLATION>

addition, Ms. Matsuda has
been designated as anindependent officer
because there is no conflictof interest with generalshareholders, and there isno special interest between
the Company and Ms.
Matsuda.
Goro
Yamaguchi〇

Mr. Goro Yamaguchi is the

Mr. Goro Yamaguchi has

Chairman andserved as theRepresentative Director ofRepresentative Director,

Kyocera Corporation, a

President, and Chairman

business partner of theof Kyocera Corporation, aCompany. Althoughmajor electronic

Kyocera Corporation andcomponent and equipment

the Company have

manufacturer, and has atransactions in automotive

wealth of experience as acomponents and othercorporate executive and a

products, the annual

high level of expertisetransaction amount is lessglobally, particularly in thethan 1% of the annual

field of electronics. The

sales of both the Company

Company has newly

and Kyocera Corporation,

nominated Mr. Goroand the Company believes

Yamaguchi as a candidatethat there is no conflict offor outside director

interest with generalbecause it believes that heshareholders.

is capable of providing
advice on the overallbusiness and managementof the Company andsupervising the executionof duties by directors.
Mr. Goro Yamaguchi does
not have any conflict with
the independence25Corporate Governance Report<TRANSLATION>

standards of the domestic
stock exchange. Although
the Company has
transactions with Kyocera
Corporation, where Mr.
Yamaguchi serves as
Chairman and
Representative Director,
for the purchase of
automotive components,
etc., the amount of thesetransactions is less than
1% of the annual sales ofboth the Company andKyocera Corporation.
Since there is no conflict ofinterest with generalshareholders, theCompany has designatedhim as an independent
officer.

[Optional Committee]

Any optional committee equivalent to theYes

Nomination Committee or Remuneration
Committee

Establishment of optional advisory committees, committee composition, and attributes of
the chairperson

Optional committee equivalent to Nomination Committee
Committee

Executive Appointment Committee

Committee

Full-time

Internal

OutsideOutsideMembers

Members

Directors

Directors

Experts

5

-

2

3

Others-Chairperson-

Internal
Director

26

Corporate Governance Report<TRANSLATION>

Optional committee equivalent to Remuneration Committee
Committee

Executive Compensation Committee

Committee

Full-time

Internal

OutsideOutsideMembers

Members

Directors

Directors

Experts

5

-

2

3

Others-Chairperson-

Internal
Director

Supplemental Remarks

As described in Principle 4-10-1, both committees are composed of three independent
outside directors and two internal directors (one of whom is the chairman). It is
mandatory to hold each event once a year, and important matters are held anddeliberated as needed.

<Composition of Executive Appointment Committee and Executive Compensation
Committee>

As of June 21, 2024

*Nobuhiko Murakami (Chairman of the Board, Chairperson of the committees)*Ichiro Kashitani (President & CEO)* Yukari Inoue (Independent outside director)* Chieko Matsuda (Independent outside director)* Goro Yamaguchi (Independent outside director)[Audit & Supervisory Board Members]

Audit & Supervisory Board

Yes

Number of Audit & Supervisory Board

5

Members

stipulatedin

Articlesof

Incorporation
Number of Audit & Supervisory Board

5

Members

Status of Cooperation between Audit & Supervisory Board members, the Accounting
Auditor, and the Corporate Internal Auditing Department[Status of Internal Audits and Audits by the Audit & Supervisory Board members]
The Audit Department conducts internal audits of the Company and Group companies
in accordance with the audit policy and plan approved by the officer in charge of the
Audit Department in conformance with the Company’s Internal Audit Regulations. The
Audit Department holds monthly meetings with the Audit & Supervisory Board

27

Corporate Governance Report<TRANSLATION>

members, reports on the audit plan and results, exchanges views, and endeavors to
improve audit quality and efficiency. In addition, the Audit Department evaluates theeffectiveness of internal controls over financial reporting.
Statutory audits involving the auditing of the performance of duties by directors are
conducted in accordance with the audit policy and plan approved by the Audit &Supervisory Board, which consists of five Audit & Supervisory Board members elected
at the General Meeting of Shareholders (two full-time and three part-time outside Audit& Supervisory Board members). Audits as for the appropriateness of the results ofaudits conducted by the independent auditors are also conducted. Furthermore, theAudit & Supervisory Board members exchange information and opinions with theInternal Audit Department and accounting auditors to enhance audits, as needed.

[Status of Accounting Audit]
For accounting audits, the Company has appointed PricewaterhouseCoopers Japan
LLC. In addition to regular accounting audits, PricewaterhouseCoopers Japan LLC
provides the Company with advice on management and organizational issues to theextent that the auditor's independence is not compromised.

Appointment of Audit & Supervisory

Yes

Board Members (Independent)
Number of Audit & Supervisory Board

3(Independent)
Number of Audit & Supervisory Board

3

Members (Independent) designated as
independent officers
Relationship with the Company (1)NameAttribute

Relationship with the Company *aTsutomu

Certified Public

Takahashi

Accountant

Seishi Tanoue

From another

b

c

d

e

f

g

h

company
Rikako Beppu

Attorney at Law* Categories for relationship with the Company“Ԃ“△” when the said individual fell under each of the following categories in the past.

28

i

j

k

l

m

Corporate Governance Report<TRANSLATION>“●” when a close relative of the said individual presently falls or has recently fallen under each of theԂ
categories in the past.
a. Executive of a listed company or its subsidiaryb. Non-executive directors or accounting advisors of the listed company or its subsidiaries
c. Executive or non-executive director of the parent company of a listed company
d. Parent company of Audit & Supervisory Board Members of listed company
e. Executive of a fellow subsidiary company of a listed company
f. The party whose principal client or supplier is a listed company or executive thereofg. Principal client or supplier of a listed company or executive thereofh. Consultant, accountant or legal professional who receives a large amount of monetary consideration or otherproperty from a listed company besides compensation as an executive
i. Principal shareholder of a listed company (executive of the said corporate shareholder if the principal shareholder
is a legal entity)
j. Executive of a client or supplier company of a listed company (which does not correspond to any of f, g, or h, above)(the said individual only)
k. Executive of a company, between which and the Company outside directors are mutually appointed (the said
individual only)
l. Executive of a company or organization that receives a donation from a listed company (the said individual only)
m. Other

Relationship with the Company (2)Name

Independent

Supplemental information

Audit &

on corresponding items

Reason for selecting as

Supervisory

Audit & Supervisory Board

Board

MemberMemberTsutomu〇-

Takahashi

Mr. Tsutomu Takahashi hasserved for many years as acertified public accountant,handling key positions at
KPMG AZSA LLC. He hasa wealth of experience andadvanced expertise incorporate accounting,corporate audit, and29

Corporate Governance Report<TRANSLATION>

compliance.
The Company has renominated Mr. Takahashi
as a candidate for outside
Audit & Supervisory Board
member because he has
been appropriately auditing
the execution of duties by
the directors of theCompany from an
independent and neutral
standpoint as an outside
Audit & Supervisory Board
member. Mr. Takahashi
does not have a conflictwith the independence
standards of the domestic
stock exchange. In
addition, Mr. Takahashi has
been designated as anindependent officer
because there is no conflictof interest with generalshareholders, and there isno business relationship orother special interests
between the Company and
Mr. Takahashi.
Seishi〇-TanoueMr. Seishi Tanoue served
as the President of thelocal subsidiary in the US,
Manager of theManagement Audit Officeand Audit & Supervisory
Board member at Toppan
Printing Co., Ltd. (Current

30Corporate Governance Report<TRANSLATION>TOPPAN Holdings Inc.).
He has a wealth ofexperience and a highlevel of knowledge inglobal corporate
management and auditing.
The Company has renominated Mr. Tanoue as a
candidate for outside Audit& Supervisory Board
member because it
believes that he is capableof appropriately auditing
the execution of duties bydirectors of the Company
as an outside Audit &Supervisory Board
member from an
independent and neutral
standpoint. Mr. Tanouedoes not have any conflictwith the independence
standards of the domestic
stock exchange. In
addition, Mr. Tanoue has
been designated as anindependent officer
because there is no conflictof interest with generalshareholders, and there isno business relationship orother special interests
between the Company and
Mr. Tanoue.
Rikako

〇

-

Beppu

Ms. Rikako Beppu has
been engaged as a lawyer

31

Corporate Governance Report<TRANSLATION>

for many years in Japanand abroad and has awealth of experience and ahigh level of expertise,especially in the areas ofinternational commercial
transactions and M&A. The
Company has newly
nominated Ms. Beppu as a
candidate for outside Audit& Supervisory Board
member because it
believes that she iscapable of appropriately
auditing the execution ofduties by directors of theCompany as an outside
Audit & Supervisory Board
member from an
independent and neutral
standpoint. Ms. Beppu has
not been involved incorporate management inany way other than being
an outside officer, but for
the reasons stated above,
we believe that she will beable to appropriately
perform her duties as an
outside Audit &Supervisory Board
member.
Ms. Beppu does not haveany conflict with theindependence standards ofthe domestic exchange. In

32

Corporate Governance Report<TRANSLATION>

addition, Ms. Beppu has
been designated as anindependent officer
because there is no conflictof interest with generalshareholders, and there isno business relationship orother special interest
between the Company and
Ms. Beppu.

[Independent Directors and Audit & Supervisory Board Members]

Number of independent directors and6

Audit & Supervisory Board Members
Matters relating to independent directors and Audit & Supervisory Board Members

Principal Concurrent Posts<Outside Director>
・Ms. Yukari Inoue: Kellogg Japan G.K (Managing Director)
・Ms. Chieko Matsuda: Faculty of Economics and Business Administration,
Tokyo Metropolitan University (Professor)
Graduate School of Management,
Tokyo Metropolitan University (Professor)
IHI Corporation (Outside Director)
Asahi Kasei Corp. (Outside Director)
Isetan Mitsukoshi Holdings Ltd. (Outside Director)
・Mr. Goro Yamaguchi: KYOCERA Corporation (Chairman of the Board andRepresentative Director)
KDDI CORPORATION (Outside Director)<Outside Audit & Supervisory Board Members>
・Mr. Tsutomu Takahashi: SKY Perfect JSAT Holdings Inc. (Outside Corporate Auditor)
Mizuho Trust & Banking Co., Ltd.
(Outside Director [Audit & Supervisory Committee Member])・Mr. Rikako Beppu: Squire Patton Boggs (Partner)
Mitsubishi Materials Corporation (Outside Director)

33

Corporate Governance Report<TRANSLATION>[Incentives]

Incentives Policies for Directors

Introduced performance-linked
compensation system

Supplemental Remarks on This Item

For details, please see “I.-1. Basic Policy [Disclosure based on each principle of the
Corporate Governance Code] Principle 3-1 (iii)” of this report.

Recipients of Stock Options

None

Supplemental Remarks on This Item

[Remuneration of Directors]

Disclosure of remuneration of individualThe

remuneration

directors

directors is disclosed

of

some

individual

Supplemental Remarks on This Item

Details of directors’ remuneration are disclosed in annual securities reports and madeavailable for public inspection on the corporate website (https://www.toyotatsusho.com/ir/). (Japanese version only)
Details of directors’ remuneration for fiscal 2023 are as follows.

Total amount of remuneration: JPY530 million for 9 directors (of which, JPY 57 million
for 5 outside directors)

Policy on Determining Remuneration

Yes

Amounts and Calculation Methods
Disclosure of Policy on Determining Remuneration Amounts and Calculation Methods

Please see I-1. Basic Policy [Disclosure based on each principle of the Corporate
Governance Code] Principle 3.1(iii) of this report.

[Support System for Outside Directors and/or Outside Audit & Supervisory Board
Members]

The Company distributes to the outside directors in advance materials on agenda items
to be proposed to the Board of Directors

34

Corporate Governance Report<TRANSLATION>

of Directors (Corporate Planning Department) and related departments explains
directly the agenda items in advance. In addition, the Company has assigned a fulltime staff to assist with the duties of the Audit & Supervisory Board members, including
the outside Audit & Supervisory Board members.
[Status of Persons Who Have Retired as President and Representative Director, Chief
Executive Officer, etc.]
Name of Consultants, Advisors, etc. who were Formerly President and Representative
Director, Chief Executive Officer, etc.

Form andConditions ofName

Title andDescription of

Employment

Position

Business(Full-time, Parttime, Paid orDate of
RetirementasPresident,

Term of
Officeetc.

Unpaid, etc.)
Jun

SeniorEngaged in

Full-time,

March 31,

From July

KaurbeExecutive

external

There is a2018

1, 2024

Advisoractivities suchrewardto Juneas business

30, 2025

activities(1 year)

Total Number of Consultants, Advisors, etc. Who Were

1

Formerly President and Representative Director, Chief
Executive Officer<Other matters>
The Company reviewed the advisor / advisor system at the Board of Directors meeting inNovember 2017, and has abolished the operation of automatically commissioning all retired
officers.
・ Senior executive advisors are commissioned for a term of one year in principle only when
it is necessary to assign duties for the company. Its business content is limited to specificbusiness commissioned individually and does not participate in any management decisionmaking.

2. Matters on Functions of Business Execution, Auditing and Supervision,
Nomination and Remuneration Decisions (Overview of Current Corporate
Governance System)
The Company has eight directors, four of whom are outside directors. The Company

35Corporate Governance Report<TRANSLATION>

has adopted the Audit & Supervisory Board system for auditing of directors’ executionof duties, which is conducted by five Audit & Supervisory Board members elected at theGeneral Meeting of Shareholders, three of whom are outside Audit & Supervisory Board
members.
The Company manages its consolidated subsidiaries through a divisional system. It
currently has eight operating divisions, and Administrative Division. Each operating
division is headed by an executive officer appointed as a Division CEO. Division CEOs
practice expeditious management in close contact with frontline personnel.
To further segregate duty execution by the entity-level management (directors) and thatby divisions (executive officers), the Board of Directors chaired by a non-executive
director strengthens a function to supervise the status of duty execution while
continuing to clarify authority and responsibility and bolster internal control.

3. Reasons for Adoption of Current Corporate Governance System
The system of a Company with an Audit & Supervisory Board is the foundation of theCompany’s corporate governance. The Company has adopted the current corporate
governance system to ensure management soundness by means of the following.
・Strengthening of appropriate decision-making and management oversight, reflecting
the expert and objective perspective of outside directors
・Strengthening of auditing and checking of the performance of duties by directors froman expert perspective and shareholders’ perspective by outside Audit & Supervisory
Board members
・Greater speed and efficiency in decision-making through an executive officer system

36

Corporate Governance Report<TRANSLATION>

III. Implementation for Measures for Shareholders and Other Stakeholders
1. Measures to Vitalize the General Meeting of Shareholders and Facilitate theExercise of Voting Rights
Supplemental Remarks
Early

The Company distributes convocation notices of the general

Notification of

meeting of shareholders early (three weeks before holding theGeneral Meeting

Ordinary General Meeting of Shareholders).

of Shareholders
Scheduling of

The Company schedules the meeting before dates on which

the Generalgeneral shareholders’ meetings of companies are concentrated.

Meeting of
Shareholders
Avoiding thePeak Day
Electronic

The Company enables the exercise of voting rights via the Internet

Exercise of

by personal computer and smartphone using a system operated

Voting Rights

by the shareholder registry administrator.

Participation in

The Company ensures sufficient time for consideration by

Electronic Voting

institutional investors using an electronic voting platform for

Platform

institutional investors operated by ICJ Corporation.

Providing

The Company prepares summary English-language convocation

Convocation ofnotices and posts them on the corporate website.

Notice in English

2. Investor Relation Activities
Presentation/Explanation
Supplemental Remarksby representative
directors

Preparation

The Company has instituted a disclosureandpolicy and the Disclosure Regulations

Publication ofand announced and declared on the

Disclosure

corporate website that it will

Policysystematically engage in effective,―

consistent information disclosure.
Regular

The Company periodically participates in

Briefings forinvestor relations events for individual37

NoCorporate Governance Report<TRANSLATION>

Individual

investors hosted or supported by

Investors

securities exchanges, securities
companies, newspaper publishers, andother external organizations and holds
Company briefings conducted by Chief
Financial Officer, Assistant to Chief
Financial Officer the Finance Department
manager or IR Group leader.
During fiscal 2023, we are implementing
various measures to continuously securecontact with individual investors, such as
online briefing sessions using SNS twotimes in total and participated in IR Expohosted by Nagoya Stock Exchange.

Regular

The Company holds quarterly results

Briefings forbriefings (with the Company

Analysts andrepresentative providing explanations at

Institutional

the full-year and half-year results

Investors

briefings).

Yes

During fiscal 2023, the Company held atotal of four briefings.
Furthermore, according to the needs ofinvestors, the Company hold individual
meetings, business briefings and facility
tours at any time.
RegularFor online /face-to-face conferences andBriefings forindividual meetings held in Japan for

Overseas

overseas investors, the Chief Financial

Investors

Officer, Assistant to Chief Financial
Officer, Finance Department Manager or
IR Office Manager provides company
explanations.
During fiscal 2023, the Company worked
to have dialogue opportunities bycontinually organizing one-on-one
meetings in the form of telephone

38

Yes

Corporate Governance Report<TRANSLATION>

conference, participate in online/face-toface conferences or Zoom session with afocus on investors based in Europe, Asia,and the Middle East.
Posting IR

The Company posts the following

Materials onmaterials and information, among others,

Websitein the Investor Relations section of the―corporate website (URL:
https://www.toyota-tsusho.com/english/ir/)
Medium- to long-term businessfinancial and operating performance

FAQ and answers.
Establishment

・Department in charge of investorof Department

relations: Finance Department, IR Group

and/or・Officer in charge of investor relations:Manager in

Chief Financial Officer (CFO) andCharge of IR

Assistant to Chief Financial Officer―

・Person responsible for investor
relations clerical liaison: IR Group leader
Other

・The Company receives opinions andsuggestions on management andstrategies and feeds them back intobusiness management, through routine
meetings between Japanese and foreign
institutional investors and securities
analysts and the department in charge ofinvestor relations, and periodic small
meetings between these stakeholders
and the Company’s top management.
・The Company annually publishes an
Integrated Report in both Japanese andEnglish to better communicate with and39―

Corporate Governance Report<TRANSLATION>

promote understanding among its
stakeholders, particularly Japanese andforeign institutional and individual
investors.

3. Measures to Ensure Due Respect for Stakeholders
Supplemental Remarks
Implementation

Sustainability for the Company is defined as the Group’sofcontinuous growth with society, creating economic value whileenvironmental

addressing environmental and social challenges, through theactivities, CSR

realization of our corporate philosophy which describes theactivities, etc.

significance of the Group's existence and its ideal image and whichclarifies the intention of management initiatives. As for thebusiness activities of environmental and social issues, the Group is
involved in a number of environmentally friendly businesses,
including a circulating economy business and a renewable energy
and energy management business.
In addition, the Company organized Sustainability Management
Committee, and the committee discusses, determines andpromotes the Group’s sustainability strategy. Details of its
sustainable initiatives and activities are introduced in the integrated
report published annually and corporate website.

Development of

The Company has instituted a disclosure policy and the Disclosure

Policies on

Regulations and systematically engages in effective, consistent

Information

information disclosure to achieve the following objectives.

Provision to・Build relationships of trust with stakeholders through proactive,

Stakeholders

effective information disclosure and fulfillment of accountability.
・Strive for timeliness and fairness in information disclosure andcontribute to appropriate share price formation and formation of
reputation in society that correctly reflect the Company’s corporate
value.
・Feed back to management the opinions of stakeholders andcontribute to enhancement of corporate value through interactive
communication with stakeholders.

40Corporate Governance Report<TRANSLATION>

IV. Matters Related to the Internal Control System
1. Basic Policy on Internal Control System and Implementation Status (Updated)[Basic Policy]
In the Toyota Tsusho Group’s Fundamental Philosophy, the Toyota Tsusho Group (the“Group”) has set forth the corporate philosophy “Living and prospering together withpeople, society, and the Earth, we aim to be a value-generating corporation that
contributes to creation of a prosperous society.” The Group has instituted the Behavioral
Guidelines as a fundamental code of conduct for legally and appropriately realizing thisphilosophy as a good corporate citizen.
In keeping with this fundamental philosophy, the Company has instituted the Basic
Policies on Establishing Internal Control Systems for the purpose of carrying on anddeepening penetration of the Toyota Tsusho DNA, which articulates the Group’s uniquevalues, beliefs, and daily principles of conduct, of promoting value creation from thecustomer’s perspective, and of fulfilling the Group’s social mission by establishing a“system for ensuring the appropriateness of the Company’s operations.”[Implementation Status]
The Company has instituted the Basic Policy on Development of Internal Control
Systems, clearly defined the duties of directors and developed a system capable oftimely and appropriately confirming the status of development of systems that ensure
the appropriateness of the Company’s operations. The Company revises the basic
policy in accordance with changes in the management environment. The status of
implementation to date is as follows.

1. Compliance system
The Company developed a “system for ensuring that the performance of duties of
directors and employees complies with laws and regulations and the Articles ofIncorporation,” made the Global Code of Conduct & Ethics thoroughly known to all
officers and employees, and established the Sustainability Management Committee
chaired by the President. The Company promotes information sharing and mutual
checks and balances among officers through such forums as the Executive Officers
Meeting.

2. Risk management system
The Company has developed “Regulations and other systems related to the
management of risk of losses” and institutes management regulations, conducts

41Corporate Governance Report<TRANSLATION>

training, and distributes manuals related to various risks. The Company has prepared
management regulations or guidelines for risks pertaining to business execution that
require particular caution, namely, business investment and loan risk, credit risk, market
risk, and occupational health and safety, and environment risks, and appropriately
identifies and manages these risks. The Company is developing appropriate
management systems at concerned departments to deal with information security, crisis
management, and other issues. In addition, the ERM Committee endeavors to identify
risks companywide and discover risk-related issues.

3. Information management system
The Company has developed a “system relating to the retention and management of
information relating to the performance of duties by directors and employees,” instituted
document regulations and document handling standards relating to document
retention, and designated departments responsible for document retention andretention periods for each type of document.

4. System for ensuring the propriety of operations of the corporate group
In the Group, in accordance with policies on divisional consolidated management, aconsolidated business plan including subsidiaries has been formulated, and the Boardof Directors supervises the information ascertained and managed about the financial
details and important matters of business execution in accordance with management
policies aligned with the systems and other characteristics of each subsidiary.
Accordingly, the Company exercises its shareholder rights at a general meeting ofshareholders of listed subsidiaries of it while making sure to clarify approval authority
at the subsidiaries with rules laid down by them and to attach importance to theirautonomy and independence. Moreover, regarding important matters for the Group, theCompany requires the responsible department to have prior consultations or reporting.
For risk management, in accordance with the Basic Policy for Risk Management, theCompany engages in necessary examination and monitoring of business processes ofsubsidiaries and strives for early detection and prevention of risks. In addition, theCompany and its group companies share the spirit of the Toyota Tsusho Group’s
Fundamental Philosophy and the Global Code of Conduct & Ethics which provides
more specific behavioral guidelines of the Group, and ensure compliance with laws,
regulations, and social ethics.

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Corporate Governance Report<TRANSLATION>

2. Basic Policy on Excluding Antisocial Forces and Implementation Status
The Toyota Tsusho Group Compliance Manual based on the Global Code of Conduct &Ethics (COCE) stipulates that the group takes a firm stance toward antisocial forces andorganizations that threaten the order and safety of civil society and the Company firmly hasa policy of rejecting any demand from antisocial forces and organizations.
To accomplish this, the Company regularly cooperates with outside specialized agencies
such as the National Center for Removal of Criminal Organizations and the Organized
Crime Control Bureau of Police Headquarters and has developed a system for dealing with
antisocial forces. The Company’s Nagoya Head Office is a member of the Aichi Prefecture
Corporate Defense Council, and receives guidance and shares information as a member.
In the event that an unreasonable demand is received from antisocial forces, the General
Affairs Department, as the designated department responsible for responding, takes aresolute stance and responds in cooperation with the police and other relevant agencies
and an attorney.

V. Other
1. Defense Against Takeovers
Defense Measures Against Takeovers

None

Supplemental Remarks on This Item

The Company has not introduced takeover defense measures at this time.

2. Other Matters Concerning Corporate Governance System
Overview of the Timely Disclosure System
The Company has instituted as Disclosure Regulations activities policies andmechanisms for all officers and employees to systematically engage in effective,
consistent information disclosure to accomplish the following items.

1) Build relationships of trust with stakeholders through proactive, effective information
disclosure and fulfillment of accountability.
2) Strive for timeliness and fairness in information disclosure and contribute toappropriate share price formation and formation of reputation in society that correctlyreflect the Company’s corporate value.
3) Feedback to management the opinions of stakeholders and contribute toenhancement of corporate value through interactive communication with stakeholders.

<Internal Systems Related to Management and Timely Disclosure of Company

43Corporate Governance Report<TRANSLATION>

Information>
Under the Disclosure Regulations, all officers and employees promptly report to theChief Strategy Officer and the department responsible for information disclosure (Public
Affairs Department) about matters decided at committee meetings and important
information occurring at the Company and its subsidiaries in accordance with thedivision of their duties. After receiving reports, the Chief Strategy Officer anddepartment responsible for information disclosure rigorously implement internal
information management, judge the necessity of timely disclosure of the information,and timely disclose information requiring disclosure.

[Corporate Governance Structure (As of June, 2024)]
General Shareholder's Meeting
Election/
Dismissal
Consultation

Board of Directors
Directors

Recommendation
Executive Compensation Committee

Exective Appointment Committee

Election/
Dismissal
Audit & Supervisory Board Members/Audit & Supervisory Board

Cooperation

Auditors

ReportAudit/Report

Independent Auditors

Outside Auditors

Outside Directors
ReportElection/
Dismissal
Supervision

Election/
Dismissal

ReportSubmission of importantmanagement matters andreporting on operational
execution

Audit

Cooperation

Independent
audit

Business Execution System

Business Execution
Organization

President &ＣＥＯ

Audit Department

Senior Executive Officers

Executive Officers Meeting

Executive Officers

Integrated Risk Management Committee
Specified Import & Export Control Committee

Division/Region/
Subsidiaries/Affiliates

Sustainability Management Committee
Investment Strategy Meeting
Investment & Loan Committee/Meeting

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Corporate Governance Report<TRANSLATION>◆TVA Analysis, “Examples of On-site Capital Cost Conscious Initiatives”◆Supplemental Explanation of Supplementary Principle 4-11-1
Skill matrix of the Board of Directors
The Company is dedicated to the vision of “Be the Right ONE” for the purpose of advancing to a newstage based on a vision for the future. The aims are the creation of distinctive forms of value that
contribute to society and protecting the environment and the establishment of business domains
linked to the unique strengths of Toyota Tsusho. To accomplish these goals, the Board of Directors
has established a skill matrix covering the expertise required of directors and members of the Audit &Supervisory Board in order to enable the Board of Directors to properly make decisions and supervise
management.
Required skills
Corporate
Management

Reasons for the selection of these skills
Experience involving corporate management is required in order to make proper management
decisions for the consistent growth of corporate value as the business climate changes rapidly.

GlobalThe Toyota Tsusho Group operates in more than 130 countries and regions. Consequently, extensive
knowledge and experience involving job postings in other countries and life styles, culture, businessclimates and other aspects of other countries are required.

Sales/
Marketing

The Toyota Tsusho Group must accurately identify and meet a broad range of customer needs as a
trading company handling many types of products. This requires sales and marketing expertisealong with a thorough understanding of numerous markets.

Finance/
Accounting

Knowledge and experience involving finance and accounting are required in order to make strategic
investments for sustained growth and other goals while using capital more efficiently and preserving
financial soundness.

Legal/Riskmanagement

Expertise and experience involving legal affairs and risk management are required for the purposesof maintaining corporate governance for sustained growth and the long-term growth of corporate
value and of establishing a risk management framework for supporting business operations,
including activities in emerging countries in Africa and other regions.

Technology・
DegitalKnowledge and experience involving new technologies and services, including information
technology and the digital transformation, are required in order to benefit from advances intechnologies, especially in the field of mobility

ＥＳＧ

Sustainability is an integral component of management at the Toyota Tsusho Group. Knowledge andexperience are required concerning ESG issues and for achieving the sustained growth of corporate
value from a long-term perspective.

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Corporate Governance Report<TRANSLATION>

The capabilities and experience of the directors and Audit & Supervisory Board members of theCompany are as below.
In addition to their expertise and wealth of experience, the Board of Directors comprises a diverse
group of members in terms of gender, nationality, and so on, and the Company has a structure thatcan flexibly adapt to various changes in the business environment.

Internal
OutsideAudit & Supervisory
Board Members

OutsideDirectors

Internal

Corporate
Management

GlobalSales/
Marketing

Finance/
Accounting

Legal/Risk Technology・
management
DegitalＥＳＧ

Nobuhiko Murakami

○

○

○

○

Ichiro Kashitani

○

○

○

○

Hiroshi Tominaga

○

○

○

Hideyuki Iwamoto

○

○

○

Didier Leroy

○

○

○
○

Yukari Inoue○○

Chieko Matsuda○○

Goro Yamaguchi

○

○

○
○

○
○
○
○

○

○

○

○
○

○

Kazumasa Miyazaki○○

Kentaro Hayashi○○

Tsutomu Takahashi○○

Seishi Tanoue

○

○

○

Rikako Beppu

○

○

○

46

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○

○
○