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Sanyo Chemical Group Material Issues
We have identified six material issues based on our company mission “Establish a better society through our corporateactivities.” We address these issues while realizing “Inspire WakuWaku feeling from all the stakeholders,” “Co-create environmental, social and economic value with the stakeholders,” and “Facilitate every employee’s value creation.”

Material issues on the business domain

Environment ECNApproach to materiality identification

Support the environment by creating an environment-friendly circular-oriented societyThe Sanyo Chemical Group defines material issues as “important issues that have a significant impact on the medium- tolong-term value creation of the Sanyo Chemical Group.” We believe that it is necessary to identify material issues in order
to continue to create value with the intention of satisfying all stakeholders defined by the Group. To create value for all

Carbon Neutrality

stakeholders, we have identified material issues by following the process 1 to 4 below, considering that identifying andprioritizing medium- to long-term themes is the shortest route to value creation.

Achieve carbon neutrality as Interface Innovator

Materiality identification steps
Life L

QOL

Support people and their lives by creating a society where people can live healthily and safely

1

Identification of issues

2

Prioritization of the issues and creation of the materiality matrix

3

Identification of material issues

4

Validation of the material issues and board approval

Quality of Life

Improve QOL by performance through chemistry

Material issues on the management domain

Society SIn

Support diversity by creating a society where everyone can shine by their personalityHCInnovation

Create innovations by supporting value
creation of industry, culture and education

Governance GRM

Conduct the risk management thoroughly
by strengthening the Guardian function

11

Develop human resources and improve
work environment by recognizing diversity

Sanyo Chemical Group Integrated Report 2023

TMThe identified issues have been prioritized through dialogue with major shareholders and employees
about their impacts on our corporate identity and finance, opportunities to create innovation, and theSanyo Chemical Group’s uniqueness. The issues were then plotted on a matrix with management andbusiness perspectives placed on the horizontal axis and expectations and contributions to resolvingsocial and environmental issues placed on the vertical axis.

Human Capital

Retain social trust with transparent management

Risk Management

Issues have been selected with reference to various guidelines, such as the SASB Standards for thechemical industry, the GRI Guidelines, the Sustainable Development Goals (SDGs), and the World Economic Forum (WEF) core metrics, as well as communication with stakeholders and a questionnaire on
our company mission for all employees and officers.

With a focus on the upper right area of the materiality matrix, six material issues have been identified,with issues related to the Environment field and the Life field as material issues on the business domain
and issues related to the Society field and the Governance field as material issues on the management
domain. (The Life field has been separated from the conventional ESG portfolio and categorized as asymbol of expectations and contributions to the improvement of QOL.)

Transparent Management

Implement challenge-oriented andtransparent management

The material issues have been validated through deliberations at the Sustainable Management Committee, which is chaired by the President and CEO, and have been approved by the Board of Directors. The
issues will be reviewed according to changes in the business environment that may occur in the future.

Sanyo Chemical Group Integrated Report 202312