March 7, 2019Engagement Agenda
Request for Engagement Meetings on Policy Concerning Cross-Shareholdings
While many companies have declared, in their “Corporate Governance Report” updated based on
the revisions to the Japan’s Corporate Governance Code in 2018, that they comply with Principle 1.4(Cross-Shareholdings)* of the Code, you may occasionally come across the cases of disclosure inwhich the purpose of holding remains general and abstract or no concrete reduction policy isprovided in the descriptions.
As such, the Institutional Investors Collective Engagement Forum (hereinafter referred to as“IICEF”) has sent a letter requesting to have collective engagement meetings on cross-shareholdings
with the five companies, namely Mitsubishi UFJ Trust and Banking Corporation, the Pension FundAssociation, Resona Bank, Limited, Sumitomo Mitsui Asset Management Company, Limited andSumitomo Mitsui Trust Asset Management Co., Ltd. (in alphabetical order; hereinafter referred to as
the “Participating Investors”), to multiple leading companies.
Issues to be discussed about in the collective engagement meetings are as follows;(i) Whether a concrete reduction policy is set up or not, and the scale of and the process for thereduction(ii) Detailed analysis of each cross-shareholdings and simulation of impacts incurred on the businessby the sales thereof(iii) Thoughts on legal concerns over cross-shareholdings as a condition in exchange for mutual
business transaction(iv) Reasons why the shareholding is linked with enhancement and strengthening of business
relationships(v) Way of thinking about “Stable(loyal) shareholder formation” through cross-shareholding, and its
policy ahead.
The Participating Investors consider that maintenance and strengthening of business relationships
and holding of shares should be recognized separately. However, because backgrounds andcircumstances of companies regarding cross-shareholdings vary widely, the Participating Investors
would like to first hold collective engagement meetings to listen to thoughts of leading companies,
then reorganize the common views of the Participating Investors and proceed with collectiveengagement meetings with many more companies.
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The realigned common views are to be disclosed on the IICEF’s website.

Contact information:
Institutional Investors Collective Engagement Forum
Directors in charge: Yuki Kimura, Naomi Yamazaki and Ryusuke Ohori
Address: Tokyo Entre Salon, Shinmaki-chou Building Annex 1, 3-2-14, Nihonbashi, Chuo-ku,
Tokyo 103-0027 JAPANE-mail: info@iicef.jp*Japan’s Corporate Governance Code (excerpt)
Principle 1.4 Cross-Shareholdings
When companies hold shares of other listed companies as cross-shareholdings, they should
disclose their policy with respect to doing so, including their policies regarding the reductionof cross-shareholdings. In addition, the board should annually assess whether or not to holdeach individual cross-shareholding, specifically examining whether the purpose is appropriate
and whether the benefits and risks from each holding cover the company’s cost of capital.
The results of this assessment should be disclosed.
Companies should establish and disclose specific standards with respect to the voting
rights as to their cross-shareholdings, and vote in accordance with the standards

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