June 1, 2021

Notice of Convocation
The 155th Ordinary General Meeting of Shareholders

Teijin Limited

Disclaimer: Please note that the following is a translation of the original Japanese documents prepared for theconvenience of our non-Japanese shareholders with voting rights. Although this translation is intended to be complete
and accurate, the Japanese original shall take precedence in the case of any discrepancies between this translation andthe original. Certain information regarding voting procedures that is not applicable for shareholders resident outside
Japan has been omitted or modified as applicable. In addition, these materials will not facilitate your status as a registeredshareholder authorized to attend the Ordinary General Meeting of Shareholders. Every shareholder attending theOrdinary General Meeting of Shareholders is required to present the Voting Card, which is sent to the registeredshareholder together with the original Notice of Convocation in Japanese, to the receptionist at the meeting.

Contents
Notice of Convocation of the 155th Ordinary General Meeting of Shareholders
Reference Documents for the General Meeting of Shareholders
Proposals and Reference
Proposal 1: Election of Ten (10) Directors
Proposal 2: Election of One (1) Statutory Auditor
Proposal 3: Revision of Amount of Remuneration, etc. and Introduction of ”Restricted Stock" and "Performance Share
Units" for Directors of the Company in Line with Revision of Remuneration Plan for Executive Officers

Attached Reports
Reports on Operations for the 155th Fiscal Year
1. Current Status of the Teijin Group(1) Progress and Results of Operations(2) Changes in Assets and Profit and Loss
(3) Capital Investments(4) Financing(5) Management Policies and Tasks Ahead(6) Primary Businesses(7) Primary Business Places(8) Employees(9) Significant Subsidiaries(10) Primary Lenders and Amount of Borrowings(11) Acquisition or disposal of shares or other interests of other companies or stock acquisition rights, etc.
2. Matters Regarding the Shares of the Company
3. Stock Acquisition Rights
4. Corporate Governance System
5. Directors and Statutory Auditors
6. Accounting Auditor
7. Policy Regarding the Determination of Dividends from Retained Earnings
8. Systems to Ensure Appropriate Business Operations and the Status of its Implementation
9. Financial Statement(1) Consolidated Balance Sheets(2) Consolidated Statements of Income(3) Consolidated Statements of Changes in Net Assets
Consolidated Statements of Comprehensive Income (Reference)
Consolidated Statements of Cash Flows (Reference)1

(Securities code: 3401)
June 1, 2021
Dear Shareholders
Jun Suzuki
President and Representative Director
Teijin Limited
2-4, Nakanoshima 3-chome,
Kita-ku, Osaka 530-8605,
Japan
Notice of Convocation ofth

the 155 Ordinary General Meeting of Shareholders

You are cordially invited to attend the 155th Ordinary General Meeting of Shareholders of Teijin Limited (“theCompany”) to be held as set forth below.

If you do not expect to attend the meeting, you may vote on the proposal for voting using the following method.
Please refer to the following “Reference Documents for the General Meeting of Shareholders,” and exercise
your voting rights by 5 p.m., Tuesday, June 22, 2021. (Japan Time)[In case of voting by Mail]
Please indicate your approval or disapproval of the proposal on the enclosed Document for the
Exercise of Voting Rights, and mail the document so that it arrives by the above deadline.

[In case of voting by Internet etc.]
Please access to the web-site to exercising voting rights (https://evote.tr.mufg.jp/) through personal Computer or
Smartphone with the log-in ID and temporary password indicated in the enclosed Document for the Exercise of
Voting Rights, and input your approval or disapproval of the proposals according to the instructions on the window.

[Information]
A video of the business report related to this General Meeting of Shareholders will be pre-delivered at the following
URL from Thursday, June 17, 2021, at 10 a.m.
https://www.teijin.com/ir/stocks/general-meeting/2

Details
1. Date and Time of the Meeting:
Wednesday, June 23, 2021, at 10 a.m. (Japan Time)(The door opens at 9 a.m.)
2. Place:
The Westin Osaka, 2nd Floor Ball Room, 1-20, Oyodonaka 1-chome, Kita-ku, Osaka, Japan

3. Purposes
Reports:
The Reports on Business Report, Consolidated Financial Statements, Non-Consolidated Financial Statements andthe Report by the Accounting Auditor and the Board of Statutory Auditors of the results of audit on theConsolidated Financial Statements, for the 155th Fiscal Year (April 1, 2020 to March 31, 2021)
Proposal 1: Election of Ten (10) Directors
Proposal 2: Election of One (1) Statutory Auditors
Proposal 3: Revision of Amount of Remuneration, etc. and Introduction of ”Restricted Stock" and "Performance
Share Units" for Directors of the Company in Line with Revision of Remuneration Plan for Executive
Officers

4. Decision on Convocation(1) If you do not indicate either approval or disapproval on the Document for the Exercise of Voting
Rights, we shall treat such “no answer” as your “approval” on the proposal.
(2) In the event of an overlap in the exercise of voting rights via the Document for the Exercise of Voting
Rights and the Internet voting system, the exercise of voting rights via the Internet voting system shall prevail.
(3) If you vote more than once using the same method, your last vote shall prevail.
5. Attachments to Notice of Convocation and Reference Documents for the General Meeting of Shareholders
If any revision should be required to the Business Report, Consolidated Financial Statements, Non-Consolidated
Financial Statements, or Reference Documents for the General Meeting of Shareholders, such revision will be postedon the Company’s website. (https://www.teijin.com/)• If you attend the General Meeting of Shareholders, please submit the attached Document for the Exercise of
Voting Rights to the reception of the meeting.
・If you attend the General Meeting of Shareholders by proxy, you may exercise your voting rights byauthorizing one(1) other shareholder with voting rights to act as its proxy as stipulated in the Company’s
Article of Incorporation.

3

Reference Documents for the General Meeting of Shareholders
Proposals and Reference
Proposal 1: Election of Ten (10) Directors
The terms of office of nine (9) Directors,— Jun Suzuki, Yoshihisa Sonobe, Akihisa Nabeshima, Toshiya Koyama,
Eiji Ogawa, Fumio Ohtsubo, Yukako Uchinaga, Yoichi Suzuki and Masaru Onishi—will expire at the conclusion ofthis General Meeting of Shareholders.
Amid drastic changes in the business environment, the Company will increase the number of Directors by one tofurther strengthen the management system for the promotion of the medium-term management plan.
Shareholders are therefore requested to elect the following ten (10) Directors (of whom eight (8) are up for reelection).
The candidates for Director are as follows.
No.

Candidate’s Name

Personal History, Positions and(Date of Birth)

Significant Concurrent Positions【Reappointment】

Jun Suzuki
1(February 19,1958)<Participation in Board of
directors meetings>
12 times out of 12 (100%)

Apr. 1983

Joined Teijin Limited

Apr. 2011

President, Teijin Holdings Netherlands B.V.

Apr. 2012

Corporate Officer, Teijin Limited

Apr. 2013

Executive Officer, Teijin Limited

Jun. 2013

Director, Executive Officer, Teijin Limited

Apr. 2014

President & Representative Director (Incumbent)

Number ofCompany’s Shares
Owned

53,600 Shares

CEO (Chief Executive officer) (Incumbent)<Significant Concurrent Positions>
Officer, Japan Association of Corporate Executives (Keizai Doyukai)<Reason of the nomination of the candidate for director >After assuming the post of President & Representative Director (CEO) in April 2014, Jun Suzuki formulated a revised medium-term plan in November of the same
year, and promoted the completion of structural reforms on which his predecessor worked. He formulated the medium-term plan “ALWAYS EVOLVING20172019” in February 2017 and “2020-2022ALWAYS EVOLVING “in February 2020. He divided each business into future profit source development (Strategic
Focus) and stably profitable existing business expansion (Profitable Growth) and positioned as a more concrete execution plan. He is promoting growth strategies
for the future.

4

No.

2

Candidate’s Name

Personal History, Positions and(Date of Birth)

Significant Concurrent Positions
Apr. 1982

Joined Teijin Limited

Apr. 2015

Corporate Officer, Teijin Group

Apr. 2017

Executive Officer, Teijin Group【Reappointment】

General Manager, Healthcare Business GroupAkihisa Nabeshima

President & Representative Director, Teijin(January 17, 1960)

Pharma Limited<Participation in Board ofApr. 2019

President for Healthcare Business of Teijin Group

directors meetings>

Jun. 2019

Director, Executive Officer, Teijin Limited

12 times out of 12 (100%)

Apr. 2021

Representative Director, Executive Officer, Teijin

Number ofCompany’s Shares
Owned

5,800 Shares

Limited (Incumbent)
Chief Financial Officer Teijin Limited(Incumbent)<Reason of the nomination of the candidate for director >Akihisa Nabeshima assumed the posts of Corporate Officer in April 2015 and Executive Officer of Teijin Group in April 2017. He has made efforts to increase
profitability of the healthcare business as General Manager of the Healthcare Business Group of the Company and as President & Representative Director of
Teijin Pharma Limited. He became President Healthcare Business of Teijin Group in April 2019 and Director Executive Officer in June 2019. He
has worked on further increasing profitability of the healthcare business, which constitutes a part of the core strategies of the Company, as wellas on growth of new healthcare business, which are the themes of the Company’s Strategic Focus. Based on having been involved in financeand accounting-related work for many years before assuming the post of Corporate Officer, he assumed the posts of Representative Director
and CFO in April 2021. He is making efforts of maintaining a sound financial base and increasing corporate value.

5

No.

Candidate’s Name

Personal History, Positions and(Date of Birth)

Significant Concurrent Positions

Number ofCompany’s Shares
Owned

Apr. 1986

Joined Teijin Limited

Apr. 2013

Corporate Officer (Riji), Teijin Group
GeneralManager,New

Materials

Business

Development Department
Chief Representative of Teijin Electronics Korea【Reappointment】

Toshiya Koyama
3(May 19,1960)<Participation in Board of
directors meetings>
9 times out of 9 (100%)

Co., Ltd.
Apr. 2015

Corporate Officer, Teijin Group

Apr. 2017

Executive Officer, Teijin Group

7,700 Shares

General Manager, Material Business Group
Apr. 2020

President, Material Business of Teijin Group

Jun. 2020

Director, Executive Officer, Teijin Limited(Incumbent)

Apr. 2021

Chief Social Responsibility Officer (Incumbent)
Responsible for Corporate Audit Department(Incumbent)<Reason of the nomination of the candidate for director >Toshiya Koyama has worked to increase earnings in the materials business of the Company, as Corporate Officer (Riji) of Teijin Group in April 2013,
Corporate Officer of Teijin Group in April 2015, and Executive Officer of Teijin Group in April 2017. In April 2020, he assumed the role of President,
Material Business of Teijin Group. He has worked to further increase profits in the materials business, which is one of our key strategic businesses, and expand thematerials business, which is the theme of our Strategic Focus. He assumed the posts of Director Executive Officer in June 2020 and Chief Social Responsibility
Officer in April 2021. He is making efforts of the management and promotion of Teijin Group CSR, compliance, risk management, ESH, social contribution
activities, and auditing system.

【Reappointment】

Apr. 1985

Joined Teijin Limited

Apr. 2016

Corporate Officer, Teijin Group

Eiji Ogawa
4

General Manager, Resin and Plastic Processing(October 26, 1962)

Business Unit, Teijin Limited<Participation in Board ofApr. 2019

Chief Officer, Corporate Strategy (Incumbent)

directors meetings>

Jun. 2020

Director, Corporate Officer Teijin Limited

9 times out of 9 (100%)

Apr. 2021

Director, Executive Officer Teijin Limited

6,975 Shares(Incumbent)<Reason of the nomination of the candidate for director >Eiji Ogawa was appointed Corporate Officer of the Teijin Group in April 2016 and had been working to increase profits in the resin business as General Managerof the Resin and Plastic Processing Business Unit. He assumed the posts of Chief Officer (Corporate Strategy) in April 2019, Director Corporate Officer inJune 2020 and Director Executive Officer in April 2021. He is making effort to formulate strategies to achieve our most important tasks of businessportfolio transformation and strengthening of management basis for creating growth platforms.

6

No.

Candidate’s Name

Personal History, Positions and(Date of Birth)

Significant Concurrent Positions
Mar. 1990

Joined Teijin Limited

Apr. 2017

Corporate Officer, Teijin Group

Number ofCompany’s Shares
Owned

Responsible for Healthcare Business of Teijin Group
General Manager, Healthcare New Business【New Candidate】
5

Naohiko Moriyama

Apr.2019(May 20,1965)

Division
Executive Officer, Teijin Group (Incumbent)

Apr. 2021

2,722 Shares

President, Healthcare Business of Teijin Group(Incumbent)
General Manager, Healthcare New Business
Division (Incumbent)<Reason of the nomination of the candidate for director >Naohiko Moriyama was appointed as Corporate Officer of the Teijin Group and Responsible for Healthcare Business in April 2017 and General Manager of
Healthcare New Business Division in April 2019 and has been working on to expand the Healthcare business field. He assumed the posts of Executive Officer of
Teijin Group in April 2021. As President Healthcare Business of Teijin Group and General Manager Healthcare New Business Division, he is working to further
increasing profitability of the healthcare business, which is one of the Company’s priority strategic businesses, and to expand new healthcare business, which is thethemes of our Strategic Focus.
Mar. 1990

Joined Teijin Limited

Apr. 2017

Corporate Officer, Teijin Group
Responsible for Material Business of Teijin Group
Assistant to General Manager, Fibers & Products
Converting Business Group (for Technology, Production,【New Candidate】
6

Akimoto Uchikawa

Restructuring Initiatives)
Jan. 2018

Management Coordinator for the President, Material

8,349 SharesBusiness of Teijin Group (for Technology, Production,(Jan 18,1966)

Restructuring Initiatives)
Apr. 2020

General Manager, Composites Business Unit

Apr. 2021

Executive Officer, Teijin Group (Incumbent)
President, Material Business of Teijin Group(Incumbent)<Reason of the nomination of the candidate for director >Akimoto Uchikawa was appointed as Corporate Officer of Teijin Group in April 2017. He became Management Coordinator for the President, Fibers &Products Converting Business Group (for Technology, Production, Restructuring Initiatives) in April 2017. He was appointed as General Manager Composites
Business Unit in April 2020. He had been working on expand the Material business field. He assumed the posts of Executive Officer of Teijin Group andPresident Material Business of Teijin Group in April 2021. He is making efforts further increasing profitability of the material business, which constitutes a part ofthe core strategies of the Company and as well as on growth of new material business, which are the themes of our Strategic Focus.

7

No.

Candidate’s Name

Personal History, Positions and(Date of Birth)

Significant Concurrent Positions
Apr. 1971

Number ofCompany’s Shares
Owned

Joined Matsushita Electric Works, Ltd., (currently
Panasonic Corporation)

Jun. 1998

Director, Matsushita Electric Works, Ltd.,

Jun. 2000

Managing Director, Matsushita Electric Works,
Ltd.

【Reappointment】
Candidate for Outside
Director

Jun. 2003

Matsushita Electric Works, Ltd.,
Jun. 2006

Fumio Ohtsubo(September 5, 1945)<Participation in Board of
directors meetings>

President, Representative Director, Matsushita
Electric Works, Ltd.,

Jun. 20127

Representative Senior Managing Director,

Chairman of the Board, Representative Director,
Panasonic Corporation

Jul. 2013

3,000 Shares

Special Advisor, Panasonic Corporation(Incumbent)

Jun. 2016

Director, Teijin Limited (Incumbent)
Member of the Advisory Board, Teijin Limited

12 times out of 12 (100%)(Incumbent)<Significant Concurrent Positions >Special Advisor, Panasonic Corporation
Trustee, Nippon Life Ins.
Director, Kansai University
Trustee, Japan-Indonesia Association, Inc.

<Reason of the nomination of the candidate for director and Roles expected >Fumio Ohtsubo had served as President and Chairman of the Board of Panasonic Corporation. As the Chairman of the Board of Directors of the Company, herevitalizes the Board of Directors and enhance its effectiveness based on his abundant business experience and high level of insight. As the Director, he is providing
appropriate advice and suggestions regarding the Company's business strategy and governance, as well as officer appointments and compensation. On behalf of ouroutside directors, he actively participates in the exchange of opinions with the outside and expresses his opinions on the governance system of the Company andfuture issues. Furthermore, as the member of the Advisory Board and the chairman of the Nomination Advisory Committee, he has fulfilled his duties sufficiently
in deliberation of important matters such as appointment and dismissal of the CEO, evaluation of the CEO's performance, appointment of Directors and Officers
other than CEO and recommendations for overall management. Therefore, we continue to select him as a candidate for Outside Director so that he can continue tosupervise management from an objective standpoint through the Board of Directors, Advisory Board, Nomination Advisory Committee and Compensation
Advisory Committee, making use of his abundant business experience and high level of insight.
The amount of transactions between Panasonic Corporation and the Company accounts for less than 1% of the consolidated net sales of either company.

8

No.

Candidate’s Name

Personal History, Positions and(Date of Birth)

Significant Concurrent Positions
Jul. 1971

Joined IBM Japan, Ltd

Apr. 1995

Director, IBM Japan, Ltd

Apr. 2000

Director, Executive Officer, IBM Japan, Ltd

Apr. 2004

Director, Senior Executive Officer. IBM Japan,

Number ofCompany’s Shares
Owned

Ltd
Apr. 2007

Board Chair, Japan Women’s Innovate Network(Incumbent)【Reappointment】
Candidate for Outside

Jun. 2007

Director, Benesse Corporation

Apr. 2008

Director, Vice Chairman, Benesse Corporation
Representative Director, Chairman of the Board,

Director

President & CEO, Berlitz Corporation
Oct. 2009

Yukako Uchinaga

Holdings, Inc.

(July 5, 1946)

Apr. 2013

Honorary Chairperson, Berlitz Corporation<Participation in Board of

Sep. 2013

President & CEO, Globalization Research Institute12 times out of 12 (100%)

800 SharesCo., Ltd. (Incumbent)

directors meetings>

8

Director, Executive Vice President, Benesse

Apr. 2014

Board Chair, Japan Diversity Network Association

Jun. 2018

Director, Teijin Limited (Incumbent)
Member of the Advisory Board, Teijin Limited(Incumbent)<Significant Concurrent Positions >Board Chair, Japan Women’s Innovate Network
President & CEO, Globalization Research Institute Co., Ltd.
Outside Director, HOYA Corporation<Reason of the nomination of the candidate for outside director and Roles expected >Yukako Uchinaga has extensive business experience, having served such roles as Director, Senior Executive Officer at IBM Japan, Ltd. and Director,
Executive Vice President at Benesse Holdings, broad knowledge of the information technology field, and deep insight in matters concerning diversity.
As the Director, she provides appropriate advice and points out on diversity activities including women’s advancement and IT / healthcare business inaddition to our business strategy and governance. Furthermore, as a member of the Advisory Board, she has fulfilled her duties sufficiently in deliberationof important matters such as appointment and dismissal of the CEO, evaluation of the CEO's performance, and recommendations for overallmanagement. She has been the member of Nomination Advisory Committee and Compensation Advisory Committee since April 2021. Therefore, we
continue to select her as a candidate for Outside Director so that she can continue to supervise management from an objective standpoint through theBoard of Directors, Advisory Board, Nomination Advisory Committee and Compensation Advisory Committee, making use of her extensive businessexperience, broad knowledge and deep insight in matters concerning diversity. The Company pays membership fees to Japan Women’s Innovative
Network (“J-Win”), at which the candidate serves as President, however the amount of this transaction accounts for less than 0.1% of the consolidated
net sales of the Teijin Group and it is less than 1% of the total membership fee revenue that J-Win receives.

9

No.

Candidate’s Name

Personal History, Positions and(Date of Birth)

Significant Concurrent Positions
Apr. 1975

Joined Ministry of Foreign Affairs, Japan (MFA)

Jun. 1997

Deputy Permanent Representative of Japan to the

Number ofCompany’s Shares
Owned

World Trade Organization (WTO) in Geneva【Reappointment】
Candidate for Outside
Director

Yoichi Suzuki(September 25, 1950)<Participation in Board of
9

directors meetings>
12 times out of 12 (100%)

Apr. 2003

Minister’s Secretariat (MFA)

Sep. 2005

Consul-General of Boston

Dec. 2008

Director-General for economic Affairs of MFA

Aug. 2010

Ambassador to Singapore

Aug. 2013

Ambassador to France

Jun. 2016

Government Representative and Ambassador in
charge of the Kansai region

Mar. 2017

1,600 Shares

Ambassador for International Economic Affairs
and Chief Negotiator for the Japan EU EPA

Apr. 2018

MFA retired

Jun. 2018

Director, Teijin Limited (Incumbent)
Member of the Advisory Board, Teijin Limited(Incumbent)<Significant Concurrent Positions >Advisor to President and Visiting Professor, Chubu university
Advisory Board Member, Amundi Japan Ltd<Reason of the nomination of the candidate for outside director and Roles expected >Although Yoichi Suzuki does not have direct experience in corporate management, he has a wealth of knowledge and experience in negotiations on
international economics and trade issues as a diplomat. As the Director, he provides appropriate advice and points out business strategies from a global
viewpoint in addition to our business strategy and governance. Furthermore, as a member of the Advisory Board, he has fulfilled his duties sufficiently indeliberation of important matters such as appointment and dismissal of the CEO, evaluation of the CEO's performance, and recommendations for overallmanagement. He has been the member of Nomination Advisory Committee and Compensation Advisory Committee since April 2021. Therefore, we
continue to select him as a candidate for Outside Director so that he can continue to supervise management from an objective standpoint through, Advisory
Board, Nomination Advisory Committee and Compensation Advisory Committee, making use of his knowledge and experience as a diplomat.

10

No.

Candidate’s Name

Personal History, Positions and(Date of Birth)

Significant Concurrent Positions
Apr. 1978

Joined Japan Air Lines Co., Ltd.

Apr. 2007

President JAL Aircraft Maintenance Narita

Apr. 2009

Executive officer, JAL International Co., Ltd

Jun. 2009

President of Japan Air Commuter

Feb. 2010

President Japan Air Lines Corporation (JAL group

Number ofCompany’s Shares
Owned

COO)
President Japan Air Lines International Co., Ltd.
Nov. 2010

President Japan Air Lines International Co., Ltd.
(Organizational change)【Reappointment】

Mar. 2011

International Co., Ltd.

Candidate for Outside
Director

Representative Director, President Japan Air Lines

Apr. 2011

Representative Director, President Japan Airlines
Co., Ltd. (Company name change from Japan Air

Masaru Onishi

Lines International Co., Ltd. to Japan Airlines Co.,(May 19, 1955)

Ltd.)<Participation in Board of

Feb. 201210

Representative Director, Chairman Japan Airlines
Co., Ltd.

directors meetings>
12 times out of 12 (100%)

1,012 Shares

Apr. 2014

Director, Chairman Japan Airlines Co., Ltd.

Jul. 2018

External Affairs Representative, Japan Airlines
Co., Ltd.

Jun. 2019

Director, Teijin Limited (Incumbent)
Member of the Advisory Board, Teijin Limited(Incumbent)<Significant Concurrent Positions >Outside Director, Mitsui O.S.K. Lines, Ltd.
Alton Aviation Consultancy Japan Co., Ltd. Senior Advisor
Visiting Professor, Toyo university
Trustees, International university<Reason of the nomination of the candidate for outside director and Roles expected>
Masaru Onishi had served as president and chairman of Japan Airlines Co. Ltd. and he has abundant business experience and high level of insight. As the
Director, he is providing appropriate advice and suggestions regarding the Company's business strategy and cooperate governance, as well as officer
compensation and appointments. Regarding corporate governance, he actively commented and pointed out the frameworks for enhancing theeffectiveness of governance and future issues in board of directors meetings as described in the dialogue of the Company’s Integrated Report 2020.
Furthermore, as the member of the Advisory Board and the chairman of the Compensation Advisory Committee, he has fulfilled his duties sufficiently indeliberation of important matters such as appointment and dismissal of the CEO, evaluation of the CEO's performance, compensation for Directors andOfficers other than CEO and recommendations for overall management. Therefore, we continue to select him as a candidate for Outside Director, so that
he can continue to supervise management from an objective standpoint through the Board of Directors, Advisory Board, Compensation Advisory
Committee, and Nomination Advisory Committee making use of his abundant business experience and high level of insight.

11Note 1: Fumio Ohtsubo, Yukako Uchinaga, Yoichi Suzuki and Masaru Onishi are candidates for Outside Directors. The
Company requires the candidate for Outside Director to satisfy all the requirements of Independent Director stipulated by
the Company. These four (4) candidates satisfy all such requirements. Since they also satisfy the requirements of
independence stipulated by Tokyo Stock Exchange Group, Inc., the Company has registered candidates for Outside
Director up for reappointment, Fumio Ohtsubo, Yukako Uchinaga Yoichi Suzuki and Masaru Onishi at the Tokyo Stock
Exchange as Independent Directors. The contents of the requirements of “Independent Director” stipulated by theCompany can be viewed at the Company’s Web site: (https://www.teijin.com/ir/management/governance/requirements/).
Note 2: The Company has entered into liabilities limitation agreements with Fumio Ohtsubo, Yukako Uchinaga, Yoichi Suzuki
and Masaru Onishi who are currently Outside Directors, which limit the liabilities of each Director to ¥20 million or theminimum amount stipulated in Article 425, Paragraph 1, of the Companies Act, whichever is higher, in accordance withthe provisions of Article 427 of the Companies Act and the Company’s Articles of Incorporation. If the reappointment isapproved, the Company will continue the liabilities limitation agreement with them.
Note 3: There are no special interests between the candidates and the Company.
Note 4: The chart below indicates the dates of the first appointment of the Outside Director for each candidate and the tenures inposition as Outside Director before the closing of this General Meeting of Shareholders.
Name

Date of First Appointment

Tenure in Position

Fumio Ohtsubo

June 22, 2016

5 years

Yukako Uchinaga

June 20, 2018

3 years

Yoichi Suzuki

June 20, 2018

3 years

Masaru Onishi

June 20, 20192 year

Note 5: In March 2020, when Fumio Ohtsubo was serving as an Outside Statutory Auditor at The Kansai Electric Power Co.,
Inc., the company was issued a business improvement order by the Ministry of Economy, Trade and Industry based on
the Electricity Business Act, due to the receipt of a large amount of money and goods by executives and employees
involved in the company’s power generation business and general power transmission and distribution business, theissuance of improper orders to the parties providing the money and goods, and weak corporate governance.
As an Outside Statutory Auditor of The Kansai Electric Power Co., Inc., he regularly encouraged caution on theimportance of legal compliance at both meetings of the company’s Board of Directors and meetings of its Audit &Supervisory Board. After the facts of the matter were confirmed, he fulfilled his responsibility by providing appropriate
examination and offering advice in relation to strengthening the system for compliance with legal and other requirements,
establishing operational management systems to ensure the appropriateness and transparency of operations, strengthening
the auditing function as well as on initiatives to prevent recurrence. He retired as the Outside Statutory Auditor of the
Kansai Electric Power Co., Inc. at the close of the Kansai Electric Power Co., Inc.'s general meeting of shareholders inJune 2020.
Note 6: About directors and officers liability insurance (D&O insurance)
The Company has concluded a directors and officers liability insurance policy as stipulated in Article 430-3, Paragraph 1of the Companies Act with an insurance company, in which each Director whose term of office expires at the conclusionof this General Meeting of Shareholders is included as an insured. The scope of an insured of said insurance policy
includes Directors and Statutory Auditors of the Company, three domestic subsidiaries (Teijin Pharma Limited, Teijin
Engineering Ltd. and DuPont Teijin Advanced Papers (Japan) Ltd.). Under said insurance policy, legally mandated
amount of indemnification and litigation expenses arising from the insured’s assumption of liability during the insurance
period, or receipt of claims pertaining to the pursuit of such liability, caused by the performance of his or her duties, will
be covered. However, claims for damages caused by intention or gross negligence will not be covered. If the election ofeach candidate is approved, all candidates (and reelected candidates will continue to be) will be included in the policy as
insureds. The full amount of the insurance premiums is borne by the Company. In addition, when the policy is renewed inJuly 2021, the Company plans to renew said insurance policy with the same terms.

12Proposal 2: Election of One (1) Statutory Auditor
The terms of office of one (1) Statutory Auditor — Hitomi Nakayama —will expire at the conclusion of this General
Meeting of Shareholders.
Shareholders are therefore requested to elect the following one (1) Statutory Auditors
The Board of Statutory Auditors has already approved this proposal.
The candidate for Statutory Auditor is as follows.
Candidate’s Name
(Date of Birth)

Personal History, Positions andSignificant Concurrent Positions
Apr. 1991

Number ofCompany’s
Shares Owned

Registered as a lawyer (The Second Tokyo Bar
Association)
Joined Kasumigaseki-Sogo Law Offices

Jun. 1994【Reappointment】

Partner lawyer, Kasumigaseki-Sogo Law Offices(Incumbent)

Candidate for Outside

Apr. 2011

Vice Chairperson, The Second Tokyo Bar Association

Statutory Auditor

Apr. 2013

Executive Director, Japan Federation of Bar Association

Jun. 2017

Statutory Auditor, Teijin Limited (Incumbent)

Hitomi Nakayama<Significant Concurrent Positions >(November 14, 1955)

Partner lawyer, Kasumigaseki-Sogo Law Offices

2,200 Share

Outside Director, Royal Holdings Co., Ltd
Director, Public Interest Incorporated Foundation “Automotive
Dispute Resolution Center”
Auditor, Japan Electric Meters Inspection Corporation<Reason of the nomination of the candidate for Statutory Auditor >Although Hitomi Nakayama does not have direct experience in corporate management, she has given accurate advice andsuggestions for maintaining and improving compliance of the Company based on her abundant knowledge and experience asa lawyer. The Company judges that she could advise on further strengthening of compliance based on her wide range ofactivities and continued to make her a candidate for outside statutory auditor.

Note 1: Hitomi Nakayama is a candidate for Outside Statutory Auditor. The Company requires the candidate for Outside
Statutory Auditor to satisfy all the requirements of Independent Statutory Auditor stipulated by the Company. This
candidate satisfies all such requirements. Since she also satisfies the requirements of independency as stipulated by
Tokyo Stock Exchange Group, she is registered by the Company as “Independent Statutory Auditor”. The contents of
the requirements of Independent Auditor” stipulated by the Company can be viewed at the Company’s Web site:(https://www.teijin.com/ir/management/governance/requirements/).
Note 2: The Company has entered into a liabilities limitation agreement with Hitomi Nakayama, which limits her liabilities
to ¥20 million or the minimum amount stipulated in Article 425, Paragraph 1, of the Companies Act, whichever ishigher, in accordance with the provisions of Article 427 of the Companies Act and the Company’s Articles ofIncorporation. If the reappointment is approved, the Company will continue the liabilities limitation agreement withher.
Note 3: As of the close of this General Meeting of Shareholders, it has been four years since she assumed Statutory Auditor(on 22 June 2017).
Note 4: There are no special interests between the candidates and the Company.
Note 5: About directors and officers liability insurance (D&O insurance)

Hitomi Nakayama is currently an outside corporate auditor of the Company. The Company has concluded a
directors and officers liability insurance policy as stipulated in Article 430-3, Paragraph 1 of the Companies Act
with an insurance company. She is included as an insured. The scope of an insured of said insurance policy
includes Directors and Statutory Auditors of the Company, three domestic subsidiaries (Teijin Pharma Limited,
Teijin Engineering Ltd. and DuPont Teijin Advanced Papers (Japan) Ltd.) .Under said insurance policy, legally13mandated amount of indemnification and litigation expenses arising from the insured’s assumption of liability
during the insurance period, or receipt of claims pertaining to the pursuit of such liability, caused by theperformance of his or her duties, will be covered. However, claims for damages caused by intention or grossnegligence will not be covered. If the election of this candidate is approved, all candidates (and reelectedcandidates will continue to be) will be included in the policy as insureds. The full amount of the insurance
premiums is borne by the Company. In addition, when the policy is renewed in July 2021, the Company plans torenew said insurance policy with the same terms.

14< Reference> Management Structure After Approval of Proposals 1, 2 (Planned)
Area of expertise and experience
TenureCategory

NameManagemen

Finance

Legal/Business/

GlobalEnvironme

Health and

IT/DX/Inno Diversity＆t experience

and

Risk

managementnt/

Safetyvationaccounting

management

Solution

Solution

〇

〇

〇

〇

〇

〇

〇

Jun Suzuki

8〇

Akihisa2〇〇〇

Inclusion

Nabeshima
Toshiya

1

〇

〇

〇

〇

〇

KoyamaEiji Ogawa

1

Naohiko

-

〇

〇
〇

〇

〇

〇

DirectorMoriyama
Akimoto-〇〇Uchikawa
Fumio

Outside

5

〇

〇

〇

Outside

3

〇

〇

〇

Outside3

Outside2

Ohtsubo
Yukako〇Uchinaga
Yoichi〇〇Suzuki
Masaru〇〇〇〇Onishi
Masanori

2〇〇

Statutory Auditor

Shimai
Akio

1

〇

〇

〇

Nakaishi
Gen Ikegami

Outside6

Hitomi

Outside4〇

Outside

1

〇

〇

〇

〇
〇

Nakayama
Jun Arima〇〇

The table is not indicative of all the expertise and experience possessed by each individual.

15〇

Proposal 3: Revision of Amount of Remuneration, etc. and Introduction of ”Restricted Stock" and "Performance Share
Units" for Directors of the Company in Line With Revision of Remuneration Plan for Executive Officers
The maximum annual remuneration for directors of the Company has been ¥700 million and the amount of the above remuneration
includes (1) ¥630 million of annual salary and (2) ¥70 million for the stock acquisition rights as stock option, as resolved by the140th Ordinary General Meeting of Shareholders held on June 23, 2006 and the 149th Ordinary General Meeting of Shareholders
held on June 24, 2015. Now, from the viewpoint of corporate governance and stakeholders and to further strengthen corporate value
creation based on strengthening management from a medium- to long-term perspective (sustainability, ESG), the Company proposes
revisions to the remuneration plan for Executive Officers.
In line with this revision, the Company wishes to set the maximum annual monetary remuneration, etc. for directors to be ¥630
million (of which, the maximum annual remuneration for outside directors to be ¥100 million), discontinue the current stockacquisition rights as stock option as the share-based remuneration plan, and pay remuneration that is separate from the other typesof monetary remuneration, etc. in order to newly grant "Restricted Stock" and "Performance Share Units" to directors of theCompany (excluding the chairman of the Board, senior advisor, and outside directors; hereinafter, “Eligible Directors”), in place ofstock acquisition rights as stock option, with the aim of providing an incentive to Eligible Directors for the achievement of targetsof the Company’s Medium-Term Management Plan and increase of medium- to long-term corporate value. Based on this proposal,
remuneration provided to Eligible Directors for allotment of "Restricted Stock" and Performance Share Units" shall be monetaryclaims in principle, and for allotment of "Restricted Stock" the total maximum annual amount shall be ¥70 million and the total
maximum annual number of ordinary shares shall be 50,000 shares, while for allotment of "Performance Share Units" the total
maximum annual amount shall be ¥300 million and the total maximum number of ordinary shares shall be 200,000 shares.
Additionally, the specific timing for payment and allocation to each Eligible Director shall be determined by the Board of Directors
upon deliberation in the Compensation Advisor Committee of the Company.
Based on this proposal, remuneration provided to Eligible Directors for allotment of "Restricted Stock" and "Performance Share
Units" shall be monetary claims in principle, and for allotment of "Restricted Stock" the total maximum annual amount shall be ¥70
million and the total maximum annual number of ordinary shares shall be 50,000 shares, while for allotment of "Performance Share
Units" the total maximum annual amount shall be ¥300 million and the total maximum number of ordinary shares shall be 200,000
shares. Additionally, the specific timing for payment and allocation to each Eligible Director shall be determined by the Board of
Directors upon deliberation in the Compensation Advisor Committee of the Company, etc.
If this proposal is approved, to ensure that contents conform to the content that was approved, a Board of Directors meeting will
be held after the conclusion of this General Meeting of Shareholders to revise the current system to the new system regarding theitems in the following table, from among the policies for determining the content of remuneration, etc., for directors as stated in the
Attached Reports.
However, the contents of the table below, including performance indicators for performance-based remuneration (consolidated
ROE, which is a profitability indicator; consolidated EBITDA, which is a growth indicator; and ROIC based on consolidated
operating income, which is an indicator of efficiency of generating profits relative to capital invested) stated in (5) and (6) (b) (1)below, performance indicators for Performance Share Units (PSU) (consolidated ROE, consolidated EBITDA, TSR andnonfinancial indicators) stated in (6) (b) (2) and Table 2 , target figures, performance evaluation periods, and composition ratios are
all those as of the start of the new system, and after the end of the medium-term management plan for 2020-2022, “ALWAYSEVOLVING” period (Limited to FY2021 and FY2022; hereinafter "initial target period"), new standards will be established within16the scope that has received approval via a resolution of the General Meeting of Shareholders.
(Revised sections are underlined)
Item

Current system

New system①Basic policy for

・The system should enhance awareness・The system should enhance awareness ofcompensation systems

of contributing to medium- to long-term

contributing to medium- to long-term

increase in earnings and corporate value

increase in earnings and corporate value

・The system should be closely linked to・The system should be closely linked tocompany results, and highly transparent

company results, and highly transparent andand objective

objective

・Be primarily focused on enhancing

・Be primarily focused on enhancing value

shared awareness of interests withshared of interests with stakeholders andshareholders and shareholder-focusedshareholder-focused management awarenessmanagement awareness・The system should maintain sufficient・The system should maintain sufficient

remuneration levels and remuneration

remuneration levels to secure high-content to act as incentives to secure high-quality management human resources

quality management human resources

・The remuneration level for internal

・The remuneration level for internal

directors and outside directors isdirectors and outside directors is determined

determined each year after verifying theeach year after verifying the appropriatenessappropriateness of the level of totalof the level of total remuneration for eachremuneration for each position, based on

position, based on the results of athe results of a remuneration survey

remuneration survey conducted among major

conducted among major corporations incorporations at which globalization ofJapan each year.

executives is progressing in Japan each year.

③Composition of・Internal director remuneration is・Internal director remuneration (excluding

remuneration, etc. forcomposed of fixed basic remuneration

the chairman of the Board and seniordirectors and statutorythat is not linked with the performanceadvisor) is composed of fixed basic

auditorsof the Company, variable performance-

remuneration that is not linked with thebased remuneration (short-term incentive

performance of the Company (cash) andremuneration), and stock acquisition"Restricted Stock" (medium- to long-termrights as stock options (medium- to long-

incentive remuneration), and variable

term incentive remuneration), with theperformance-based remuneration (short-term

aim of instilling awareness of short-term

incentive remuneration) and "Performanceachievement of performance goals andShare Units" (medium- to long-term

medium- to long-term improvement of

incentive remuneration), with the aim ofcorporate value.

instilling awareness of short-term

・Remuneration for outside directors andachievement of performance goals,

statutory auditors is solely fixedachievement of the medium-term

remuneration.

management plan, and providing an incentive②Remuneration level17

toward medium- to long-term improvementof corporate value.
・Remuneration for the chairman of theBoard, senior advisor, outside directors, andstatutory auditors is solely fixed
remuneration, not linked with theperformance of the Company.
See Table 1-1 below

See Table 1-2 below⑤Performance indicators

Three indicators presented as(1) Performance-based remunerationfor variable remuneration

performance targets concerning variable

Three indicators presented as performance

remuneration for the medium-termtargets concerning variable remuneration for

management plan for 2020-2022,

the medium-term management plan for 2020-“ALWAYS EVOLVING,” have been

2022, “ALWAYS EVOLVING,” have been

selected as key performance indicators

selected as key performance indicators(KPIs) for variable remuneration:(KPIs) for performance-based remuneration:

consolidated ROE, which is a

consolidated ROE, which is a profitability

profitability indicator; consolidated

indicator; consolidated EBITDA, which is a

EBITDA, which is a growth indicator;

growth indicator; and ROIC based on

and ROIC based on consolidated

consolidated operating income, which is anoperating income, which is an indicator

indicator of efficiency of generating profits

of efficiency of generating profits

relative to capital invested. Their selection

relative to capital invested. Their

will motivate each director to improve theselection will motivate each director to

KPIs.

improve the KPIs.

(2) Performance Share Units④Composition ratio of
remuneration

While aligning targets with the medium-term
management plan, TSR from the viewpointof stakeholders and the indicators of 1)
Changing Portfolio and 2) Diversity andInclusion will be used from the TSR view ofstakeholders and from the viewpoint ofsustainable growth and ESG (Environment,
Social, Governance) will also be used. See
Table 2 for indicators and targets, etc. for theperiod the medium-term management planfor 2020-2022, “ALWAYS EVOLVING”(Limited to FY2021 and FY2022; hereinafter"initial target period").

18

⑥Policy on determining(a) Basic remuneration (Cash): The(a) Fixed remuneration:

timing and conditions foramount paid to each director is(1) Basic remuneration (Cash): The amountproviding remuneration,

determined according to their position

paid to each director is determined accordingetc.

and paid as a fixed amount.

to their position and paid as a fixed amount.

1/12 of a fixed amount by position is

1/12 of a fixed amount by position isprovided as monthly remuneration.

provided as monthly remuneration.
(2) Restricted Stock (RS):Maximum annual
amount ¥70 million (Maximum annual
number 50,000 shares), and around July or
August of every year, a certain number ofshares determined by position will be allottedwith transfer restrictions and other conditions
within the scope that has received approval
via a resolution of the General Meeting of
Shareholders.

(b) Performance-based remuneration(b) Variable remuneration:(Cash):(1) Performance-based remuneration(Cash):Calculated depending on position, theCalculated depending on position, theachievement level of consolidated ROE,

achievement level of consolidated ROE, thethe achievement versus forecast ofachievement versus forecast of consolidated

consolidated EBITDA and consolidated

EBITDA and consolidated ROIC based on

ROIC based on consolidated operating

consolidated operating income, and theincome, and the individual performance

individual performance evaluation of theevaluation of the director, and provided

director, and provided by the end of June as aby the end of June as a year-end lumpyear-end lump sum.

sum.

Additionally, new performance evaluation
periods and performance evaluation
indicators will be subsequently set within thescope that has received approval via aresolution of the General Meeting of
Shareholders.
(2)" Performance Share Units" (PSU):
Maximum annual amount is ¥300 million(Maximum annual number 200,000 shares),and around July or August of every year, thenumber of shares calculated depending on
the target achievement of one or multiple
performance indicators set by the Board of
Directors applicable to performance
evaluation periods comprised of one or19multiple fiscal years will be allotted after
conclusion of the evaluation performance
period set for each performance indicatorwith transfer restrictions and other conditions
within the scope that has received approval
via a resolution of the General Meeting of
Shareholders. See Table 2 for the initial
performance evaluation period andperformance indicators. Additionally, evenafter the conclusion of the initial
performance evaluation period, newperformance evaluation periods andperformance evaluation indicators will be
subsequently set within the scope that hasreceived approval via a resolution of the(c) Acquisition rights as stock option

The Company’s stock options aredesigned based on acquisition rights as
stock option plan where the exercise
price is ¥1 (the stock option recipient
pays ¥1 per stock). The number of stock
options allocated varies depending on
the target achievement of consolidated
ROE and the achievement versus
plannedconsolidated

EBITDA.

Moreover, the allocated stock options
have a condition that allows therecipient to exercise the options withina five-year period after retiring as adirector. Every February, amounts are
determined based on the projected levelof target achievement for ROE and the
projected level of achievement for
EBITDA in the relevant fiscal year,with payment provided by the end of
March.

20

General Meeting of Shareholders.

Remuneration composition ratio for internal directors
Table 1-1 (Current system)
Position

Fixed remuneration
Basic remuneration(Cash)All Directors

60%

Variable remuneration
Performance-based
remuneration(Cash)
25%

Total

Acquisitionrights as stock
option15%

remuneration
100%(Note 1) Ratios of Performance-based remuneration and acquisition rights as stock option are ratios if achieving standard figuresfrom among graded targets (hereinafter “Standard Targets”), and increases or decreases depending on actual levels ofachievement.
(Note 2) Upon deliberation in the Advisory Board and the Compensation Advisor Committee, the ratio of basic remuneration will
be reduced from FY2020 onward, and of the remuneration ratios for the previous fiscal year (FY2019), the Board of
Directors determined to modify basic remuneration from 65% to 60%, and acquisition rights as stock option from 10%
to 15%.

Table 1-2 (New system)
Position

Fixed remuneration
Basic
Restricted Stockremuneration (RS)(Cash)

President&Representative
Director, CEO
Other directors(Note)

Variable remuneration

45%

10%

Performancebased
remuneration(Cash)
20%

50%

10%

25%

Total
remuneration

Performance
Share Units (PSU)

25%

100%

15%

100%

For performance-based remuneration, ratios are if achieving standard figures from among graded targets (hereinafter“Standard Targets”), and for "Performance Share Units", if achieving targets. For "Performance Share Units" (PSU), one
target is set for each performance indicator, and the payment of the corresponding composition ratio is determined by theachievement of said performance indicator.
Under the new system, in consideration of the results of a remuneration survey conducted among major corporations at
which globalization of executives is progressing in Japan, and in exchange for allotment of stock-based remuneration
with the aim of instilling awareness of achievement of the medium-term management plan and medium- to long-term
improvement of corporate value, the Company will create a remuneration structure that lowers the ratio of basic
remuneration under fixed remuneration and the cash remuneration portion of performance-based remuneration and raises
the ratio of share-based remuneration, which the Company believes will contribute more to achievement of the mediumterm management plan and medium- to long-term improvement of corporate value than the current system. Additionally,
by differentiating from other directors the ratio of variable remuneration and share-based remuneration for the President& Representative Director, CEO, the system clarifies the position and the significance of its responsibilities.
The Advisory Board deliberates on the remuneration of the President & Representative Director, CEO, and theCompensation Advisor Committee deliberates on the remuneration for directors other than the President & Representative

21

Director, CEO. After the deliberations, proposals for the remuneration of the President & Representative Director, CEOand the remuneration for other directors other than the President & Representative Director, CEO are presented anddetermined by the Board of Directors.
Table 2

Targets

Composition

Performance evaluation

Timing of shareratio ofperiodallotment

standard
amounts of

Performance

share-based

evaluation indicators

remuneration
by position(Annualamount)ROE

10% or higher

40%

One year

Annually

EBITDAFY2022: ¥150.0

40%

Two years

The year after the final
year of the medium-billion or more
TSR

The Company’s

10%term management plan

TSR >= Benchmark(By multiplying the

TSR

number of years in theperformance

Nonfinancial

1)FY2022:

indicators

Strategic Focus

evaluation period

1) Changing

EBITDA>=15%

during the process ofPortfolio2) More than six

calculating the number

2) Diversity andfemale executivesof shares to be

and six non-allotted, the number ofJapanese executives

shares to be allottedin FY2022

for the performance(* “Executives”

evaluation period is

includes Executive

calculated at once)

Inclusion

10%

Officers andCorporate Officers)(Note)

The content above is all as of the start of the new system, and after the end of the initial performance evaluation period,
new standards will be established within the scope that has received approval via a resolution of the General Meeting of
Shareholders.

Additionally, although the number of directors is currently nine (including four outside directors), if Proposal 1 “Election of ten(10) directors” is approved as originally proposed, the number of directors will be ten (including four outside directors).
Furthermore, the upper limits on the amount of cash remuneration, etc., for directors and the remuneration amount for the amountof monetary claims, etc., for allotment of "Restricted Stock" and "Performance Share Units" and the conditions for allotment of

22

"Restricted Stock" and "Performance Share Units" to Eligible Directors based on the total number of the Company’s ordinary shares
to be issued or disposed of and other factors in this proposal are determined in consideration of the above objectives, the status of
the Company’s business, policies regarding the determination of the content of remuneration, etc., for individual directors of theCompany and other factors. As a result, the Company believes that this proposal is appropriate because its content is required andrational as a remuneration structure.

1. Outline of "Restricted Stock"
The "Restricted Stock" is an advance-allotment type share-based remuneration plan in which Eligible Directors are provided with
monetary claims in principle based on a resolution of the Board of Directors of the Company, and Eligible Directors shall in turn
pay all monetary claims in the form of property contributed in kind to receive ordinary shares of the Company that shall be issued
or disposed of by the Company (*1). The total maximum annual number of ordinary shares to be newly issued or disposed of by theCompany as a result of the above shall be no more than 50,000 shares (however, if a share split (including the allotment of ordinary
shares of the Company without consideration), a reverse share split, or any other reason in which adjustment of the total number ofordinary shares of the Company to be issued or disposed of as "Restricted Stock" takes place on or after the day on which this
proposal is approved and adopted, such total number will be adjusted to a reasonable extent as necessary).The number of ordinary
shares of the Company issued or disposed of to the Eligible Director shall be a fixed number set based on the position of the Eligible
Director.
Furthermore, the amount to be paid per share shall be approved by the Board of Directors based on the closing price of ordinary
shares of the Company on the Tokyo Stock Exchange on the business day immediately preceding the date of the resolution of theBoard of Directors (or the closing price on the trading day immediately prior thereto if there is no trading on the relevant businessday) to the extent that Eligible Directors receiving ordinary shares do not receive an especially advantageous amount.

[Payment conditions, etc. for Eligible Directors]
The Company will issue or dispose of the Company's ordinary stock to each Eligible Director on the condition that the Eligible
Directors meets the following requirements.
(1) There was no certain non-conformity stipulated by the Board of Directors of the Company(2) Other requirements deemed necessary by the Board of Directors of the Company as " Restricted Stock".

The issuance or disposal of ordinary shares of the Company based on the "Restricted Stock" of the Company and payment ofmonetary claims as property contributed in kind shall be conditional that an agreement on the allotment of restricted shares shall beentered into between the Company and the Eligible Director (hereinafter, “RS Allotment Agreement”).

[Outline of RS Allotment Agreement](1) Transfer restriction period
From the date that Eligible Directors receive allotment via the RS Allotment Agreement (hereinafter, “Allotment Date”), Eligible
Directors may not transfer, create security interests, or make any disposal of the Company’s ordinary shares (hereinafter, “RS
Allotment Shares”) received via allotment under the RS Allotment Agreement until the time immediately after retirement from a
position defined in advance by the Company’s Board of Directors (hereinafter, “RS Transfer Restriction Period”; the above
conditions are hereinafter collectively, “Transfer Restrictions”).

23

(2) Release of Transfer Restrictions
Under the condition that an Eligible Director continuously serves for a period defined in advance by the Board of Directors of theCompany (hereinafter “Service Provision Period”) in a position defined in advance by the Company’s Board of Directors, all of the
RS Allotment Shares will have all transfer restrictions released upon expiration of the RS Transfer Restriction Period.
(3) Handling of retirement
Notwithstanding the provisions of (2) above, if an Eligible Director retires from the position defined in advance by the Board of
Directors prior to the expiration of the Service Provision Period owing to reasons including expiration of term of office, reachingretirement age, death, or other valid reason (Personal circumstances are not included; the same applies hereinafter.), a portion of RS
Allotment Shares (reasonably calculated in consideration of the term of office, etc. of said Eligible Director) will have transfer
restrictions released immediately after said retirement, and the Company will acquire without compensation any remaining portions
that do not have transfer restrictions released. Additionally, if an Eligible Director retires from the position defined in advance by
the Board of Directors owing to reasons other than expiration of term of office, reaching retirement age, death, or other valid reason,
the Company will acquire without compensation all RS Allotment Shares as a matter of course.
(4) Handling of organizational restructuring
Notwithstanding the provisions of (2) above, if during the RS Transfer Restriction Period matters relating to a merger agreementin which the Company is the dissolved company, a share exchange agreement or share transfer plan in which the Company becomesa wholly-owned subsidiary, or any other organizational restructuring, etc., are approved at a General Meeting of Shareholders of theCompany (however, if said organizational restructuring, etc., does not require approval of a General Meeting of Shareholders of theCompany, the Board of Directors of the Company; only if the effective date arrives before the expiration of the RS Transfer
Restriction Period), the Board of Directors may, via a resolution, release transfer restrictions ahead of the effective date of saidorganizational restructuring, etc., for the number of RS Allotment Shares reasonably determined in consideration of the period
between the start date of the Service Provision Period and the approval date of said organizational restructuring, etc. Additionally,
if defined above, the Company will acquire without compensation all RS Allotment Shares that have not had transfer restrictions
lifted as a matter of course immediately after the transfer restrictions are released.
(5) Other reasons for without compensation acquisition
During the RS Transfer Restriction Period, if the Company’s CEO finds that an Eligible Director is found guilty of a crime andimprisoned, if an Eligible Director requests to begin bankruptcy proceedings, etc., or if an Eligible Director becomes involved inoperations, etc., that compete with the Company Group’s business without prior authorization from the Company or if theCompany’s CEO finds that the Eligible Director plans to be involved in such operation, etc. after retirement (if the Eligible Director
is the CEO, if the Board of Directors passes a resolution; the same applies hereinafter), or if the Company’s CEO finds that the
Eligible Director has violated laws and regulations or the Company’s internal regulations, etc., the Company is able to acquire
without compensation all RS Allotment Shares as a matter of course under certain conditions.
(6) Other matters
Other matters regarding the RS Allotment Agreement shall be defined by the Board of Directors of the Company.

(*1)

However, if after the start of the Service Provision Period, the Eligible Director retires from the position defined by
the Board of Directors owing to reasons including expiration of term of office, reaching retirement age, death, orother valid reason before the issuance or disposal of the Company’s ordinary shares, the Company will provide cash
to the Eligible Director in an amount reasonably calculated in view of the Eligible Director’s term of office during
said Service Provision Period promptly after his or her retirement. Additionally, if after the start of the Service

24

Provision Period, matters relating to a merger agreement in which the Company is the dissolved company, a shareexchange agreement or share transfer plan in which the Company becomes a wholly-owned subsidiary, or any otherorganizational restructuring, etc., are approved at a General Meeting of Shareholders of the Company (however, if
said organizational restructuring, etc., does not require approval of a General Meeting of Shareholders of theCompany, the Board of Directors of the Company) before the issuance or disposal of the Company’s shares, theBoard of Directors may, via a resolution, provide cash to Eligible Directors in an amount reasonably calculated inconsideration of the period between the start date of the Service Provision Period and the approval date of saidorganizational restructuring, etc. Furthermore, if the position of an Eligible Director changes after the start of theService Provision Period and said Eligible Director retires prior to the start of the next Service Provision Period, theCompany will provide cash to said Eligible Director as required in an amount reasonably calculated in considerationof the timing of the change in position during the Service Provision Period and the position after the change.

2. Outline of "Performance Share Units"
The "Performance Share Units" is a post-allotment type share-based remuneration plan in which the Board of Directors of theCompany establishes in advance an evaluation period comprising one or more fiscal years of the applicable fiscal years under theCompany’s medium-term management plan (hereinafter, “Performance Evaluation Period”) and one or more performance indicatorsfrom among the performance indicators set from the viewpoints of stakeholders and important indicators of the medium-term
management plan, in principle Eligible Directors are provided with monetary claims for the issuance or disposal of the Company’s
ordinary shares according to the level of achievement of said performance indicators, and Eligible Directors in turn pay all monetaryclaims in the form of property contributed in kind to receive ordinary shares of the Company that shall be issued or disposed of by
the Company. As such, the provision of monetary claims to Eligible Directors for the issuance or disposal of the Company’s ordinary
shares shall be, in principle, after the end of the Performance Evaluation Period. Additionally, as the "Performance Share Units" isa plan in which monetary claims are provided for the issuance or disposal of the Company’s ordinary shares according to the levelof achievement, etc., of the above performance evaluation indicators, as of the time of introduction of the "Performance Share Units",
nothing has been determined with regard to the payment or lack thereof, to be provided to each Eligible Director, the number of theCompany’s ordinary shares to be issued or disposed of (hereinafter, “Number of Allotted Shares”), or the amount of monetary claims
for the issuance or disposal of the Company’s ordinary shares to be provided to each Eligible Director.
Furthermore, although the initial target period, Performance Evaluation Period and performance evaluation indicators during theinitial target period are planned to be those in Table 2, even after the end of the initial target period Performance Evaluation Period,
the Company may continue to implement the "Performance Share Units" within the scope that has received approval in this proposal
by setting a new Performance Evaluation Period and performance evaluation indicators within the scope that has received approvalin this proposal.

[Specific features of the "Performance Share Units"]①The Board of Directors of the Company will define performance evaluation indicators required for the calculation of the numberof the Company’s ordinary shares and monetary claims, etc., for issuance or disposal to each Eligible Director and the targets,
payment ratios, and evaluations, etc., for state of achievement under the "Performance Share Units".
②In principle, the Company will determine the number of the Company’s ordinary shares to be allotted to each Eligible Director
after the conclusion of the Performance Evaluation Period, corresponding to the level of achievement, etc., of the targets in eachperformance evaluation indicator during the Performance Evaluation Period. For performance share units (PSU), one target is set

25

for each performance indicator, and the payment of the corresponding composition ratio is determined by the achievement of said
performance indicator.
③Corresponding to the number of the Company’s ordinary shares to be allotted to each Eligible Director determined in ② above,
the Company will provide in principle monetary claims for the allotment of performance share units to each Eligible Director basedon a resolution of the Board of Directors of the Company, and each Eligible Director will receive allotment of the corresponding
number of the Company’s shares by providing contributions in kind for all of said monetary claims. Furthermore, the amount to be
paid per share of the Company’s ordinary shares shall be approved by the Board of Directors based on the closing price of ordinary
shares of the Company on the Tokyo Stock Exchange on the business day immediately preceding the date of the resolution of theBoard of Directors (or the closing price on the trading day immediately prior thereto if there is no trading on the relevant businessday) to the extent that the Eligible Directors who will receive allotments above receiving ordinary shares do not receive an especiallyadvantageous amount.

(1) Calculation method for the number of the Company’s ordinary shares to be issued or disposed of and the amount of monetaryclaims to be allotted
The Company will calculate the number of the Company’s ordinary shares to be issued or disposed of to each Eligible Director
based on the calculation method in ① below, and calculate the amount of monetary claims to be allotted to Eligible Directors basedon the calculation method in ② below.
The total maximum annual number of ordinary shares to be newly issued or disposed of by the Company to Eligible Directors basedon the "Performance Share Units" shall be 200,000 shares (however, if a share split (including the allotment of ordinary shares of
the Company without consideration), a reverse share split, or any other reason in which adjustment of the total number of ordinary
shares of the Company to be issued or disposed of as "Performance Share Units" takes place on or after the day on which this
proposal is approved and adopted, such total number will be adjusted to a reasonable extent as necessary).

①Calculation method for the number of the Company’s ordinary shares to be issued or disposed of for Eligible Directors
The number of shares to be allotted shall be calculated by dividing the allotment amount calculated using the standard share
remuneration amount by position (*2), composition ratio of each performance evaluation indicator (*3), Performance Evaluation
Period, and term of office ratio by the standard share price (*4) (for calculation methods for the initial target period, see Table 3
below. The formulas in Table 3 below are for the performance evaluation indicators, their composition ratios, and Performance
Evaluation Period at the beginning of the new system. After the end of the initial target period, the number of shares to be allotted
will be calculated based on the newly set performance evaluation indicators, their composition ratios, and the Performance
Evaluation Period.) (*5). For the performance evaluation indicator, composition ratios of each performance evaluation indicator the
Performance Evaluation Period and targets for each performance evaluation indicator for the initial Performance Evaluation Period
and targets for the performance evaluation period and each performance evaluation indicator, see Table 2.
(*2)

It means a predetermined standard annual amount for each position related to performance-linked share
remuneration.

(*3)

For composition ratio for each performance evaluation indicator, if targets for each performance evaluation indicator
are achieved during the Performance Evaluation Period, the composition ratio will be the composition ratio of eachperformance evaluation indicator as described in Table 2, and if said targets are not achieved, it will be zero.

(*4)

The closing price of ordinary shares of the Company on the Tokyo Stock Exchange on the business day immediately
preceding the date of the resolution of the Board of Directors (or the closing price on the trading day immediately

26

prior thereto if there is no trading on the relevant business day) for the granting of performance-based share-based
remuneration for each fiscal year.

27

Table 3 Calculation formula for the number of shares to be allotted for “Performance Share Units”* In the medium-term management plan for 2020-2022, the introduction of the new system will be from the second year after thestart of the medium-term management plan, so during the initial target period, it will be calculated using ii) and iii) of the following
calculation methods...
i) First year of medium-term management plan
Number of shares to be allotted = Standard share-based remuneration amount by position X composition ratio of performance
evaluation indicator (for consolidated ROE) X performance evaluation period X term of office ratio / standard share priceii) Second year of medium-term management plan
Number of shares to be allotted = Standard share-based remuneration amount by position X composition ratio of performance
evaluation indicator (for consolidated ROE) X performance evaluation period X term of office ratio / standard share priceiii) Third year of medium-term management plan
The number of shares to be allotted will be the total of A to D below.
A = Standard share-based remuneration amount by position X composition ratio of performance evaluation indicator (forconsolidated ROE) X performance evaluation period X term of office ratio / standard share price
B = Standard share-based remuneration amount by position X composition ratio of performance evaluation indicator (forconsolidated EBITDA) X performance evaluation period X term of office ratio / standard share priceC = Standard share-based remuneration amount by position X composition ratio of performance evaluation indicator (for TSR)
X performance evaluation period X term of office ratio / standard share price
D = Standard share-based remuneration amount by position X composition ratio of performance evaluation indicator (fornonfinancial indicators) X performance evaluation period X term of office ratio / standard share price(*5)

If during the performance evaluation period, an Eligible Director retires owing to expiration of term of office,reaching retirement age, death, or other valid reason, calculations will be made with reasonable adjustments to thenumber of shares made as required in consideration of the term of office until retirement during the performance
evaluation period, the position of the Eligible Director during said period, and level of achievement for targets ineach fiscal year, separately defined in each performance evaluation indicator, as of the time of said retirement.

② Calculation method for monetary claims to be allotted to each Eligible Director
The Company will calculate the number of the Company’s ordinary shares to be issued or disposed of to each Eligible Director
based on the calculation method in (1) above, and calculate the amount of monetary claims to be allotted to each Eligible Directors
by multiplying it by the share price at the time of allotment. The share price at the time of allotment shall be approved by the Boardof Directors based on the closing price of ordinary shares of the Company on the Tokyo Stock Exchange on the business day
immediately preceding the date of the resolution of the Board of Directors (or the closing price on the trading day immediately
prior thereto if there is no trading on the relevant business day) of the Company regarding the issuance or disposal of the Company’s
ordinary shares after the end of the Performance Evaluation Period to the extent that the Eligible Directors who will receive
allotments above do not receive an especially advantageous amount.

28

(2) Allotment conditions, etc., for Eligible Directors
If the following conditions are met after the end of the performance evaluation period, the Company will issue or dispose of theCompany’s ordinary shares to each Eligible Director based on the calculation method in (1) above (*6, 7).
① The Eligible Director was in a position designated by the Company’s Board of Directors for a period of the entirety or a portionof the Performance Evaluation Period② There was no certain non-conformity stipulated by the Board of Directors of the Company③ Other required conditions for “Performance Share Units” as defined by the Board of Directors of the Company(*6)

If during the Performance Evaluation Period, an Eligible Director retires owing to expiration of term of office,reaching retirement age, death, or other valid reason, the Company’s ordinary shares will be issued or disposed ofin accordance with the number calculated by (*5) above, to the Eligible Director (if the retirement is due to death,then the rights successor to the Eligible Director) within a reasonable period after retirement.

(*7)

If after the start of the Performance Evaluation Period, matters relating to a merger agreement in which the Company
is the dissolved company, a share exchange agreement or share transfer agreement in which the Company becomesa wholly-owned subsidiary, or any other organizational restructuring, etc., are approved at a General Meeting of
Shareholders of the Company (however, if said organizational restructuring, etc., does not require approval of aGeneral Meeting of Shareholders of the Company, the Board of Directors of the Company) before the issuance ordisposal of the Company’s shares, the Board of Directors may, via a resolution, grant the Company’s ordinary sharesor cash. If allotting ordinary shares, the Company’s ordinary shares will be issued or disposed of to Eligible
Directors ahead of the effective date of said organizational restructuring, etc., in consideration of the period between
the start of the performance evaluation period and the date of approval of said organizational restructuring, thepositions of the Eligible Directors during said period, and the level of achievement of performance evaluation
indicators as of the time of said resolution of Board of Directors, with reasonable adjustments made to the numberof shares as required.

If allotting cash, an amount of cash reasonably calculated in consideration of the period between the start of the Performance
Evaluation Period and the date of approval of said organizational restructuring, the positions of the Eligible Directors during
said period, and the level of achievement of performance evaluation indicators as of the time of said resolution of Board of
Directors will be provided to Eligible Directors.
The issuance or disposal of ordinary shares and payment of monetary claims as property contributed in kind based on said
“Performance Share Units” of the Company shall be conditional that an agreement on the allotment of performance-linked
shares shall be entered into between the Company and the Eligible Director (hereinafter, “PSU Allotment Agreement”).

[Outline of PSU Allotment Agreement](1) Transfer restriction period
From the date that Eligible Directors receive allotment via the PSU Allotment Agreement (hereinafter, “Allotment Date”), Eligible
Directors may not transfer, create security interests, or make any disposal of the Company’s ordinary shares (hereinafter, “PSU
Allotment Shares”) received via allotment under the PSU Allotment Agreement until the time immediately after retirement from a
position defined in advance by the Company’s Board of Directors (hereinafter, “PSU Transfer Restriction Period”; the above
conditions are hereinafter collectively, “Transfer Restrictions”).
(2) Lifting of Transfer Restrictions
Under the condition that an Eligible Director continuously serves during the PSU Transfer Restriction Period in a position defined29

in advance by the Company’s Board of Directors, all of the PSU Allotment Shares will have all transfer restrictions released ofTransfer Restrictions
Under the upon expiration of the PSU Transfer Restriction Period.
(3) Handling of retirement
Notwithstanding the provisions of (2) above, if an Eligible Director retires from the position defined in advance by the Board of
Directors of the Company owing to reasons other than expiration of term of office, reaching retirement age, death, or other valid
reason, the Company will acquire without compensation all PSU Allotment Shares as a matter of course.
(4) Handling of organizational restructuring
Notwithstanding the provisions of (2) above, if during the PSU Transfer Restriction Period matters relating to a merger agreementin which the Company is the dissolved company, a share exchange agreement or share transfer plan in which the Company becomesa wholly-owned subsidiary, or any other organizational restructuring, etc., are approved at a General Meeting of Shareholders of theCompany (however, if said organizational restructuring, etc., does not require approval of a General Meeting of Shareholders of theCompany, the Board of Directors of the Company; only if the effective date arrives before the expiration of the PSU Transfer
Restriction Period), the Board of Directors of the Company will, via a resolution, release transfer restrictions ahead of the effective
date of said organizational restructuring, etc., for all PSU Allotment Shares.
(5) Other reasons for gratis acquisition without compensation
During the PSU Transfer Restriction Period, if an Eligible Director is found guilty of a crime and imprisoned, if an Eligible Director
requests to begin bankruptcy proceedings, etc., or if the Company’s CEO finds that an Eligible Director becomes involved inoperations, etc., that compete with the Company Group’s business without prior authorization from the Company or if theCompany’s CEO finds that the Eligible Director plans to be involved in such operations, etc. after retirement, or if the Company’s
CEO finds that the Eligible Director has violated laws and regulations or the Company’s internal regulations, etc., the Company isable to? may acquire without compensation all PSU Allotment Shares as a matter of course under certain conditions.

30

Attached Reports
Reports on Operations for the 155th Fiscal Year (April 1, 2020 to March 31, 2021)
1. Current Status of the Teijin Group(1) Progress and Results of Operations
1) Progress and Results of Operating Activities①Sales and Income
The global COVID-19 pandemic and the resulting governmental restrictions on people’s activities have caused the global
economy to remain sluggish and face high uncertainty. The pandemic severely affected the global economy especially in thefirst half of this term, and then the economy turned around once. However, subsequent waves of the pandemic slowed
economic recovery worldwide in the second half of the term
The Teijin Group formulated its Medium-Term Management Plan for the three years from FY2020, which the Grouppositions as a period for creating growth platforms toward sustainable growth, under its long-term vision of becoming acompany that supports the society of the future by contributing to realizing a sustainable world. In FY2020, the first fiscal
year of the Plan, as prior investments in enhancing profitability in the Materials Business Field toward the future, the Groupmade capital investment in increasing its para-aramid fiber production capacity, and implemented two plant projects in North
America: one to build a new composites plant in Texas and the other to prepare for the operation of a new carbon fibers plant.
In the Healthcare Business Field, the Group decided to take over the rights for the Japan sales of diabetes treatments fromTakeda Pharmaceutical Company Limited, and in collaboration field between business fields, the Group brought Japan Tissue
Engineering Co., Ltd. (hereinafter, “J-TEC”) under its umbrella as a subsidiary through a TOB with the aim of entering theregenerative medicine business.
Increased demand amid the COVID-19 pandemic for medical protective equipment (gowns, etc.) in the Fibers & Products
Converting Business and for products and services in the IT Business contributed to the Teijin Group's consolidated financial
results for this term. Also, the Healthcare Business Field remained solid despite the impact of drug price revisions. Meanwhile,in the Materials Business Field, the Group was affected by reduced demand for products mainly for automotive and aircraft
applications. Accordingly, the Teijin Group posted net sales of 836.5 billion yen, a 2.0% decrease year on year, operating
income of 54.9 billion yen, a 2.3% decline year on year, and ordinary income of 53.7 billion yen, a1.2% decrease year on year.
Profit attributable to owners of parent was −6.7 billion yen (ref.: 25.3 billion yen for the previous fiscal year) mainly due tothe recording of an impairment loss on fixed assets owned by the carbon fibers business under the impact of an expected longterm decline in aircraft demand.
As a result, ROE, an indicator of profitability, was −1.7%, far short of the FY2022 target set in the Medium-Term
Management Plan (over 10%), while EBITDA, an indicator of the ability to generate cash, was 106.8 billion yen, remaining
at the same level as in the previous fiscal year despite the impact of the COVID-19 pandemic. ROIC, based on operating
income, of 8.6% met the FY2022 target set in of the Medium-Term Management Plan (over 8%).

31

②Analysis of Assets, Liabilities and Net Assets
Total assets as of March 31, 2021, amounted to 1,036.4 billion yen, an increase of 32.2 billion yen from the end of
FY2019. This increase is explained mainly by the inclusion of the goodwill of Japan Tissue Engineering Co., Ltd. in
the Group’s accounts as a result of the Group’s acquisition of shares of Japan Tissue Engineering with the aim ofentering the regenerative medicine business, and by a rise in the market value of shares held, despite a decrease in the
carbon fibers business’s fixed assets due to impairment losses.
Total liabilities amounted to 608.2 billion yen, increasing by 15.4 billion yen from the end of FY2019, mainly due
to the increase in trade payables.
Despite a decrease due to the recording of a loss attributable to owners of parent, total net assets amounted to 428.3
billion yen, an increase of 16.8 billion yen compared with the end of FY2019. This growth was caused mainly by anincrease in foreign currency translation adjustments due to the depreciation of the yen against major currencies andin the difference between the market value and book value of shares held. As a result, the debt-to-equity ratio was 0.9
times, and the equity ratio was 39.2%.
Segment operating results (sales and operating income) of the Teijin Group are as follows.
(Billions of yen / %)Fiscal 2019

Fiscal 2020

ChangePercentage

High-performancematerials
Composites

236.4

210.4

△25.9

△11.0

91.2

86.6

△4.6

△5.1

Materials Sub Total

327.5

297.0

△30.6

△9.3

Healthcare

153.9

148.7

△5.3

△3.4

Fibers & Products Converting

306.3

314.9

+8.6

+2.8

IT

48.6

58.1

+9.5

+19.6

Others

17.4

17.8

+0.5

+2.7

Total

853.7

836.5

△17.2

△2.0

Materials

15.8

1.0

△14.9

△94.0

Healthcare

32.6

31.5

△1.0

△3.2

Fibers & Products Converting

5.4

17.5

+12.1

+223.3

IT

7.8

10.4

+2.6

+32.9

Others

0.3

△0.2

△0.6

-

Elimination and corporate

△5.8

△5.2

+0.5

-

Total

56.2

54.9

△1.3

△2.3

Materials
Net sales
Operating income

32

Business Segment Results for fiscal 2020 were as follows:
I. Materials Business Field
Although the COVID-19 pandemic reduced demand for products for automotive and aircraft applications, the recovery
in the automotive market in the second half of the term led to an upturn in sales of products for automotive applications.
In each subsegment, SG&A expenses cut by limited activities.
In the Materials Business Field, sales were 297.0 billion yen, a decrease of 30.6 billion yen (9.3%) year on year, while
operating income was 1.0 billion yen, a decline of 14.9 billion yen (94.0%) year on year. EBITDA was 31.5 billion yen,decreasing by 13.3 billion yen year on year.
In the aramid business, Twaron para-aramid fibers, the major product in the business, experienced a sales decline for all
applications, including tire reinforcing material, friction material, and other automotive applications, as well as opticalfibers. However, the product’s sales later improved in line with the recovery in the relevant markets.
In the resin and plastic processing business, sales of polycarbonate resins, the main product in the business, recovered fromthe second half of the term and reached the same level as in the previous term. Under the impact of a sharp rise in themarket price of BPA, a key raw material, from the second half of the term, selling price revision is under way.
In the carbon fibers business, sales of TENAX carbon fibers drastically dropped for aircraft applications due to reduced
demand in the aircraft market. Therefore, greater sales efforts were focused on non-aircraft applications, such as wind
power generation and recreation applications. Sustained efforts toward future growth have been made, including developing
intermediate materials for aircraft applications and making the necessary investment for putting into operation a new plantin North America.
In the composites business, a significant decrease in OEM production had a severe impact on the production and sales ofautomotive parts at Continental Structural Plastics Holdings Corporation (CSP) in the United States at the beginning of theterm. However, the recovery in the U.S. automotive market, especially for SUVs and pickup trucks, led to a remarkable
improvement in automotive parts production and sales. The continued provision of a relatively high level of unemployment
benefits in the U.S. has posed CSP the challenge of securing workforce sufficient to support its recovering plant operations.
To address the challenge, CSP has been adopting measures to improve the employee retention rate.

II. Healthcare Business Field
Despite the impact of drug price revisions on FEBURIC and other pharmaceutical products distributed in Japan, salesof FEBURIC and home healthcare services grew. Amid the COVID-19 pandemic, the adoption of online remote sales
activities and other new approaches caused a decrease in SG&A expenses.
In the Healthcare Business Field, sales were 148.7 billion yen, a drop of 5.3 billion yen (3.4%) year on year, while operating
income was 31.5 billion yen, a decline of 1.0 billion yen (3.2%) year on year. EBITDA was 43.7 billion yen, a decrease of
0.9 billion yen year on year.
In the pharmaceutical business, products for the Japanese market, especially the hyperuricemia and gout treatment
33

FEBURIC, were affected by drug price revisions in April 2020. However, sales of FEBURIC and Somatuline*, a treatment
for acromegaly, pituitary gigantism, and neuroendocrine tumors, increased steadily.
* Somatuline® is the registered trademark of Ipsen Pharma, France.
In the home oxygen therapy (HOT) market, an increased number of patients chose to use home healthcare services toavoid in-hospital COVID-19 infection. Together with other circumstances, including the more widespread use of portable
oxygen concentrators, the increased number of home healthcare users resulted in a growth in the number of rented units ofHOT equipment. In the market for continuous positive airway pressure (CPAP) therapy, the COVID-19 pandemic caused
a decline in the number of patients hospitalized for examination and slowed the expansion of the market. However, themarket for CPAP devices for use by medical practitioners has been growing, with the number of rented CPAP devices
continuously increasing. In addition, the relaxation of requirements for counting remote monitoring in medical fee
calculation led an increasing number of medical institutions to introduce NemLink, a medical treatment support tool.
In the new healthcare business, the COVID-19 pandemic caused surgeries to be postponed and reduced the sales volumeof orthopedic implantable devices, including artificial joints and absorbable osteosynthesis materials, at the beginning of
the term. However, a recovery in the number of surgical operations and the growth in sales of new products from the second
quarter resulted in a year-on-year increase in annual sales.

III. Fibers & Products Converting businessIn the Fibers & Products Converting Business, sales were 314.9 billion yen, an increase of 8.6 billion yen (2.8%) year on
year, while operating income was 17.5 billion yen, an increase of 12.1 billion yen (223.3%) year on year. EBITDA was
23.9 billion yen, a growth of 11.5 billion yen year on year.
The COVID-19 pandemic hurt sales of textiles and heavy clothing, but boosted demand for medical protective equipment(gowns, etc.) for the use of medical professionals, leading the Fibers & Products Converting Business to contribute
immensely to the Group’s business performance by supplying those items of equipment. Sales of clothes of the kind thatsatisfied stay-at-home demand were robust, while sales of masks with improved infection-control functions, short polyester
fibers for water treatment use, and other products also remained strong. In addition, sales of automotive parts, which werepoor at the beginning of the term, started taking a clear upward trend in the second half of the term. The decreased SG&A
expenses due to limited business activities also contributed to the business results.

IV. IT businessIn the IT Business, sales were 58.1 billion yen, up 9.5 billion yen (19.6%) year on year, while operating income was 10.4
billion yen, an increase of 2.6 billion yen (32.9%) year on year. EBITDA was 11.3 billion yen, growing by 2.6 billion yen
year on year.
The business solution field was affected by the COVID-19 pandemic especially in terms of services for medical institutions.
However, sales of e-comics services in the digital entertainment field remained strong against the background of an increased
e-comics readership.

V. OtherIn the others, sales were 17.8 billion yen, an increase of 0.5 billion yen (2.7%) year on year, while the operating loss was34

0.2 billion yen (ref.: operating income of 0.3 billion yen for the previous fiscal year). EBITDA was 0.7 billion yen, adecrease of 0.6 billion yen year on year.
The Teijin Group brought J-TEC, a company listed on the Tokyo Stock Exchange’s JASDAQ Growth market, under its
umbrella as a subsidiary through a TOB. The new subsidiary has been consolidated since the end of the term.

2) Progress and Results of Non-Operating Activities
The progress and results of non-operating activities conducted by the Teijin Group (“the Group”) during the
fiscal year under review were as follows.
The expectations and responsibilities placed on companies to resolve global social issues, such as the United Nations’Sustainable Development Goals (SDGs), are becoming incredibly large. Considering these social issues, the Group hasorganized the risks and opportunities for the Company and established five types of materiality and KPI to pursue as
management issues. In response to these materiality issues, in addition to providing solutions through our business, theGroup is working to strengthen our foundation in reducing our environmental impact as well as in diversity and inclusion.
In terms of reducing environmental impact, the Company established medium- and long-term goals in FY2019 toreduce emissions of CO2, water, hazardous chemicals and landfill waste. In response to addressing climate change issues,
which is an urgent issue worldwide, we have established goals of reducing the Group’s total CO2 emissions by 20% by
FY2030 and of realizing net zero emissions by FY2050. We aim to achieve these goals by continuing and enhancing
initiatives in energy conversion and increased productivity. In FY2020, we decided to newly introduce internal carbon
pricing (ICP) system to support capital investment plans that contribute to reducing CO2 emissions. In response toaddressing the issues of water shortages and water contamination, we have set a goal of 30% improvement of theCompany’s freshwater intake volume per sales unit by FY2030. While expanding the number of products that use little
water and promoting the efficient use of water in our businesses, we are also promoting policies to reduce water risk inlocations in regions with high water risk.
On the issue of “Diversity & Inclusion,” we are promoting personnel diversity, women’s advancement, and workstyle
diversity, aiming to realize an organization that fully demonstrates the abilities of diverse human resources with different
values and experiences in order to revitalize the organization and stimulate innovation. In its promotion of active roles
for women, we have set KPIs of ten or more female officers and 300 or more female managers by FY2030, withmilestones by the end of FY2022 of six or more female officers and 174 or more female managers. As a result of
increasing the number of women participating in training for selected officer candidates and providing careeradvancement and ongoing career support for female employees through women’s leadership training etc., the Company
has been selected as one of “Nadeshiko Brands” which are jointly conducted by the Ministry of Economy, Trade andIndustry and the Tokyo Stock Exchange to select enterprises that encourage women’s success in the workplace, for the
fourth consecutive year. In FY2020, taking the opportunity of countermeasures against the novel coronavirus, we rapidly
expanded the use of telework mainly in the head office areas of Tokyo and Osaka, and we began to work on reforming
the mindset and work conventions, due to the increased necessity to consider new workstyles, and swiftly realize andestablish them in response to the “New Normal,” where commuting to the office and face-to-face interaction are nolonger natural assumptions. Specifically, cross-organizational discussions were held on the five themes of “paperless,”“business visualization,” “communication,” “office space & social distancing,” and “work system / evaluation,” which
are closely related to promoting workstyles that support the New Normal, and measures addressing many issues were35

implemented. For example, discussions on “communication” led to the implementation of an initiative in which aquestionnaire-style survey is conducted for employees in departments where telework becomes the main work format inorder to visualize the communication status of the department, and based on those results, the required measures are
created by each department. Through these measures, we have proactively developed activities where each employee isseeking new workstyles and taking action.
Furthermore, the Group proactively approaches social contribution activities in line with the characteristics of thedifferent business groups and regions. In light of policy initiatives for sustainability set forth in the “Medium-Term
Management Plan for 2020-2022,” in FY2020 we revised the Group Basic Policy for Social Contributions. Towardsupporting the development of the next generation through science and education, sports activities, etc., through the
Teijin Kumura Scholarship provided by the Teijin Scholarship Foundation that was established to foster young scientists,
we have supported around 1,700 science and engineering students over more than 60 years. In 2010, we launched ascholarship system in China, providing scholarships to 36 students in FY2020. In addition, we are working to support
youth sports such as by being a sponsor of the All Japan High School Soccer Tournament, and by endorsing the“Children’s Rights in Sport Principles” promoted by the Japan Committee for UNICEF.
Additionally, we continually operate a range of initiatives to support employee volunteer activities.
These initiatives have been recognized through the inclusion of the Group in multiple international social development
investment indexes, such as FTSE4Good, MSCI ESG Index, and DJSI Asia Pacific.

36

(2) Changes in Assets and Profit and Loss
Fiscal Period

152nd Fiscal Period 153rdFiscal Period 154thFiscal Period 155thFiscal Period
FY2017FY2018FY2019

Items(Current period)

Net sales(Millions of yen)
Operating income(Millions of yen)
Ordinary income(Millions of yen)
Profit attributable to owners ofparentFY2020(Millions of yen)

Net earnings per share(Yen)
Total assets(Millions of yen)
Net assets(Millions of yen)

834,986

888,589853,746

836,51269,82360,00056,20554,931

67,82060,26454,33753,65845,55645,05725,252△6,662231.26232.39131.63△34.70981,967

1,020,654

1,004,223

1,036,427

408,237

427,212411,409428,257

Note: The stated amount is rounded to the nearest million yen.

(3) Capital Investments
Capital investments by the Group in fiscal 2020 totaled ¥60.3billion, mainly for the purpose of increasing the production
capacity of aramid business and composites business.

(4) Financing
The Company procured finance borrowings from financial institutions and Straight Bond. As a result of a decrease inborrowings, interest-bearing debt amounted to ¥380.0 billion, a decrease of ¥1.9 billion from the end of the previous year.

37

(5) Management Policies and Tasks Ahead
1) Corporate Vision
To help realize a sustainable society, based on our corporate philosophy, the plan calls for the Teijin Group to deliver
solutions in three key fields: 1) environmental value, 2) safety, security and disaster mitigation, and 3) demographic
change and increased health consciousness. In order to realize the long-term vision, the Teijin Group will sort out risks
and opportunities for the company based on global social issues and the goals set by the SDGs, and identify fivematerialities (important issues) to prioritize, "climate change mitigation and adaptation," "realization of a circular
economy," "ensuring the safety and security of people and local communities," "realization of healthy and comfortable
lives for people," and "Further strengthening the sustainable management base" which is an important management issue.
Through these materiality initiatives, the Teijin Group aims to realize a sustainable society and further enhance its
corporate value.

Environmental Value Solutions
Safety, Security, and Disaster Mitigation
Solutions
Demographic Change and Increased
Health Consciousness Solutions

Provide products and services contributing to global environmental goals suchas prevention and adaptation of climate change and achievement of a circular
economyProvide products and services protecting lives and livelihoods from various risks
such as disasters and accidents
Provide products and services supporting healthy and comfortable living forpeople of all ages

2) Tasks Ahead
In February 2020, the Teijin Group formulated and announced its new medium-term management plan for 2020-2022,“ALWAYS EVOLVING,” (hereinafter, “the medium-term management plan”) as a three-year action plan to realize its
long-term vision, positioning the period of this plan (FY2020 to FY2022) as a period of establishing a foundation forsustainable growth.
We will actively invest in businesses portfolio which is broadly divided into Strategic Focus areas to boost cash-generating
abilities in new businesses and Profitable Growth areas to expand stably profitable existing businesses.
Although the expansion of COVID-19 brings about drastic changes in the economy, people's lives, and values at the global
38

level, the materialities that the Teijin Group is working on are will not change. We take the changes brought about by
COVID-19 as opportunities and consider that it is necessary to continue to provide three solutions and accelerate growthinvestment in the territory of the Three Solutions. In the materials business field, in the stream of "green recovery", westeadily grasp the needs for weight reduction of mobility and replacement with high-performance materials andlightweight materials in social infrastructure, and recover from the impact of COVID-19 on the business and accelerate
for an early return to the growth trajectory. In the realization of carbon neutrality, we will minimize the environmental
burden of our business activities, implement a roadmap to achieve our goals, and promote technological innovation torealize a hydrogen-based society. In the healthcare business field, due to concerns about the risk of COVID-19 infection,
there is a growing need for the Teijin Group's goal of providing comprehensive community care services and digitalsolutions for medical care, while there are refraining from receiving medical examinations and restraining hospitalization.
Also, we will steadily work on pursuance of synergy with IT business and new business creation through collaboration
with IT business, materials business and engineering divisions.

a) Quantitative targets in the medium-term management plan
Placing emphasis on both investment efficiency and earning power, we identify its most important indicators to be ROE(company-wide) and operating income ROIC (company-wide and business-specific) as the most important profitability
indicators, and EBITDA (company-wide and business-specific) as the most important growth indicator. We will continue toaim for ROE of 10% or more, operating income of ROIC of 8% or more, and EBITDA of 150 billion yen, which are thequantitative targets for FY2022 set in the medium-term management plan. However, the EBITDA outlook for FY2022 bybusiness segment has been revised due to changes in the business environment. In the materials business, EBITDA of 80
billion yen is expected to be 65 billion yen, because of the delay in sales expansion in each business including the carbon
fiber business due to the impact of COVID-19. In the healthcare business, EBITDA of 45 billion yen is expected to be 60
billion yen, considering that the succession of sales of four type 2 diabetes drugs in Japan from Takeda Pharmaceutical
Company Limited will make a significant contribution.
The outlook for FY2021, the target for FY 2022 (the final year of the medium term), and the EBITDA outlook by
segment are as follows.
FY2021

FY2022

.

ROE

8%

10%+

Operating income ROIC

7%

8%+

130.0bil. yen

150.0bil. yen

Materials

43.5bil. yen

65.0bil. yen

Healthcare

67.5bil. yen

60.0bil. yen*2

Others *1

19.0bil. yen

25.0bil. yen*2

EBITDA(Breakdown)*1 Including " Fibers & Products Converting ", "IT", " Others segment" and " Elimination or intersegment transactions".
*2 Revised to the latest outlookb) Input resource level in the medium-term management plan
Under the active investment policy to establish a growth platform, in the materials business, we will build a new factoryfor composites for automobiles in Texas, USA, a new factory for carbon fiber in South Carolina, USA, and expand facilities
for aramid fiber. In the healthcare business, we entered into an agreement with Takeda Pharmaceutical Company Limited
39

regarding the succession of sales of four type 2 diabetes drugs in Japan and invested 133 billion yen. In addition, as an
initiative in the integrated area of materials, healthcare and engineering, J-TEC became a subsidiary, and we will work to
expand the business of regenerative medicine products.
In order to achieve the EBITDA target of 150 billion yen in the medium-term management plan and to establish a growth
platform for achieving the long-term target, both Material and Healthcare Business Field need to continue active investmentin the “Strategic Focus” area in the remaining two years of the medium-term management plan. Therefore, the investment
and M&A budget for the medium-term period (cumulative three years) will be increased from 350 billion yen to 450 billion
yen. This expansion of the investment budget will be funded by debt raising but is premised on maintaining a certain level offinancial discipline. We will not change the dividend policy, which targets a dividend payout ratio of 30%.

c) Focus on solution area
In the “Three Solutions” area, we will accelerate efforts to address social issues by increasing the investment amountfrom 85% to 90% of the total, aiming to increase sales in these three fields to 75% of total sales by FY2030.

d) Business Portfolio
Dividing the business portfolio into Strategic Focus areas to boost cash-generating abilities in new businesses andProfitable Growth area to expand stably profitable existing businesses, we will continue allocation of input resources for
portfolio transformation from a medium- to long-term perspective and expanding cash creation.
40

We will continue to aim for the target EBITDA in Strategic Focus area of 15% in FY2022 and at least 1/3 of the wholeGroup by FY2030.
J-TEC, a pioneer of regenerative medicine in Japan, became a subsidiary, and the product business such as regenerative
medicine product business will be positioned as Strategic Focus and we accelerate to expand business. In addition, we willproceed with the succession of manufacturing and marketing approval from Takeda Pharmaceutical Company Limited
smoothly and efficiently so that we can stably deliver types 2 diabetes drugs such as "Nesina" to patients. Furthermore, wewill maintain and expand our business foundation through initiatives in major product groups in the diabetic field, andcontribute not only to drug sales but also to the prevention of lifestyle-related diseases such as prevention of diabetic
aggravation, which we are working on as "Strategic Focus"e) Risk reduction (reduction of environmental load)
The Teijin Group provides innovative solutions that contribute to the improvement of the "Quality of Life" by focusing on
people in order to realize a sustainable society, and at the same time, aims to minimize the negative impact derived frombusiness activities on the environment and society.
In terms of climate change mitigation and adaptation, and the realization of a circular economy, we established “European
Sustainable Technology Innovation Center” and focus on research and development of products and services that contributeto the achievement of global environmental goals. In addition, toward the realization of carbon neutrality in 2050, we createda roadmap for long-term goals for reducing environmental impact and steadily promote reduction activities to achieve them.
In FY2020, we set a new goal of reducing the amount of landfill waste as a resource recycling initiative. In addition, we will
actively work on LCA (Life Cycle Assessment) for our composites for automobiles and Aramid fibers etc.

Item

Contribution to CO2
reduction*1
Climate change(CO2 emissions)

FY

Target"Avoided emissions" > "Total emissions"

2030
2030

20% reduction from FY2018 level total emissions
Net zero emissions

2050
Water
(freshwater intake)Hazardous materials

30% improvement from FY2018 level(per sales unit)
20% improvement from FY2018 level(hazardous chemical emissions per sales unit)

2030
2030

41

Circular economy(Newly set*2）

2030

10% improvement from FY2018 level（Landfill Waste Volume per sales unit）*1 Reduction impact on CO2 emissions in the supply chain downstream through the use of the Company’s products.
We aim to make our avoided CO2 emissions larger than our total Groupwide emissions and supply chain upstream emission*2 Already disclosed in the integrated report year ended March 31,2020.

f) Strengthen the business baseAs a mechanism to continuously provide accurate solutions and accelerate market development, we will strengthen thefoundation for creating innovation from the perspectives of "organization," "synergies," "technology," and "humanresources," and accelerate the creation of business opportunities.
Regarding the "organization," we established the "Corporate Business Incubation Division" in April 2021. We will
promote the examination and implementation of M&A and alliances from a company-wide with long-term perspective,
the search and development of new areas that will lead the next generation, and R&D and new business development tobuild the foundation for innovation creation. In addition, in this division, we will expand regenerative medical products
by maximizing the "synergies" of our technology /business foundation in our healthcare materials business and engineering
capabilities with J-TEC, which has become a newly consolidated subsidiary.
In "technology," we will accelerate the development of digital technology. We will further strengthen collaboration with
Infocom Corporation, which plays a central role in our IT business, and actively work on digital transformation (DX) to
introduce work styles and business processes suitable for the new normal environment, to improve productivity at R&D
and manufacturing sites, and to transform business models.
Regarding "human resources," providing flexible working styles and establishing a system in which not only women but
also diversifying human resources can demonstrate their abilities and play active roles will lead to the fostering of acorporate culture that creates innovation. We set the following KPIs according to regional characteristics not only in Japanbut also overseas, and promote diversity and inclusion throughout the group.
(People)Item

Diversity of executives*1
Key goals for
women’sadvancements*2

Japan
US
EU
China
ASEAN

Female executives
Non-Japanese executives
Managers (or higher)
Senior managers*3
Global core talent*4
Senior managers*3
Senior managers*3

FY2019FY2022
Milestone

FY2030Milestone

3
3
116
2
0
4
5

6 or more
6 or more
174
43
95 or more

10 or more
12 or more
300 or more
101012
8 or more*1 Directors, statutory auditors, Group executive officers, and Group corporate officers*2 Key goals are set based on regional situations *3 President or his/her direct report in a Group company*4 Human resources of female senior managers selected and certified as executive candidates

In addition to the above KPIs, from the perspective of "inclusion" that equal access to people of various races andreligions, we set a KPI of ethnic minorities for senior manager positions in the United States, etc. and will strengthen ourefforts.

g) Main business strategy■Overall policy
In FY2020, the materials business field was particularly affected by COVID-19, demand for carbon fibers and otheraircraft products continued to be sluggish, but demand for composites and aramid fibers for automobiles are on a42

recovery track.

In FY2021, we aim to reach the level before the impact of COVID-19 at an early stage, and will incorporate the main
issues for “establishing a growth platform” set forth in the medium-term plan into a concrete action plan and link it to
implementation.
In addition, we will steadily promote efforts to maximize the effects of large-scale investments, such as the successionof sales of four type 2 diabetes drugs and making J-TEC a subsidiary.
Materials business field【Strategic Focus (boost cash-generating abilities in new businesses)】Composites for automotive

Carbon fiber Intermediate materials
for aircraft Maintaining the top position in US by acquiring new programs andexpanding sales, and accelerating expansion into Asian markets (including
China) and Europe
 Promotion of multi-materialization and life cycle assessment
 Promotion of efforts to improve productivity
 Promotion of development for the acquisition of new large-scale programs
for future aircraft【Profitable Growth(expand stably profitable existing businesses)】AramidResin and Plastic Processing
Carbon fiber

 Maintaining and strengthening the top position by increasing production
capacity and promoting application development
 Establishing stable profits by expanding high value-added products
 Improving the profitability of the yarn selling business by improving
production operation and sales mix■Healthcare【Strategic Focus (boost cash-generating abilities in new businesses)】Comprehensive community healthcare
related business
Functional foods
New Medical devices, etc.

 Launching a service business in the community-platformed
comprehensive care-related market, starting with the aggravation
prevention business Expanding sales of existing products and steadily launch new products
 Expanding sales of implantable medical devices and launch new medical
device businesses

43

【Profitable Growth(expand stably profitable existing businesses)】

Pharmaceuticals and Home Healthcare Building a community-based sales model by means of a team effort bystaff from a variety of functions through shifting to functional structure
system Maintaining and expanding sales of main pharmaceuticals ("FEBURIC",
type 2 diabetes treatment), HOT (home oxygen therapy), CPAP (medical
equipment, and continuous positive airway pressure) medical equipment
 Promotion of development of new medical devices and pharmaceuticals■Fibers & Products Converting / IT【Profitable Growth(expand stably profitable existing businesses)】

Fibers & Products ConvertingIT

 Steady implementation of measures to strengthen profitability
 Maintaining a solid position as an electronic comic brand Development of new services in the nursing care field in the healthcare
business44

(6) Primary Businesses(As of March 31, 2021)
Business Segments

Business area

High-performance Aramidmaterials

Principal Products and Businesses
Para-aramid fibers, Meta-aramid fibers,
High-performance polyethylene

Materials

Resin and Plastic

Polycarbonate resin, Polycarbonate sheets & films,

Processing

PET・PEN ･PBN resin, PPS resin, Frame-retardant

Carbon Fibers

Carbon fibers, Oxidized PAN fibers, Carbon fibers intermediatematerials (Prepreg etc.)

Material New

Lithium-ion battery separators, high-performance membrane

Business
Composites

Composite products

The automotive composite products

Pharmaceuticals

Prescription Drug: Treatment for Hyperuricemia and gout, Agentfor Osteoporosis, Agent for Infection, Sustained-release
expectorant, Transdermal analgesic anti-inflammatory, Treatment
for acromegaly and pituitary gigantism, Botulinum toxin type A

Healthcare

Home Healthcare

Home Health Care Services: Oxygen Concentrator for Home
Oxygen Therapy (HOT), Continuous Positive Airway Pressure Unit
(CPAP), Bilevel Positive Airway Pressure Unit, Ultrasound Bone
Fracture Treatment Device

Healthcare New

Medical devices for artificial joints, osteosynthesis materials,

Businessspinal implants etc.,

Textiles and Apparel

Yarns, Textiles, Apparel products, General merchandise

Fibers & Products

Industrial Textiles

Fiber materials, Nonwoven Fabric,

Convertingand Materials

Industrial and Automotive materials, Living and interior goods,
Resin, films, Packaging materials and construction materials

Business solution

Information system for general companies, Information system for
hospital, Information services for nursing care providers

IT

Digital entertainment Electronic comics delivery service
OthersOthersEngineering services, design and sales of plants and equipment
Regenerative Medicine Products, Cultured Human Tissue for
Research Use

Note: PET (Polyethylene terephthalate), PEN (Polyethylene naphthalate), PBN (Polybutylene naphthalate),
PPS (Polyphenylene sulfide)45

(7) Primary Business Places(As of March 31, 2021)
Business
The Company

Function

Location

Headquarters

Osaka, Tokyo

High-performance

Manufacturing

Shizuoka, Gifu, Ehime, Hiroshima, Yamaguchi

materials

bases

the Netherlands, Germany, Thailand, Vietnam, China, South Korea, U.S.A.

Operation bases Tokyo, Osaka Aichi
the Netherlands, Germany, Russia, Malaysia, Singapore, India, Thailand,
Vietnam, China, Taiwan, South Korea, U.S.A., Mexico, Brazil
Materials

Research bases Tokyo, Chiba, Shizuoka, Ehime, Yamaguchi
the Netherlands, Germany, China, Thailand, U.S.A.,
Composites

Manufacturing

Ehime, Gifu

bases

Germany, Portugal, Czech, U.S.A., Mexico, China

Operation bases Tokyo
Portugal, Czech, U.S.A., Mexico, China
Research bases Ehime
Germany, France, U.S.A.
Healthcare

Manufacturing

Yamaguchi, Okayama, Hyogo

bases

China

Operation bases 12 branches and 75 sales offices throughout Japan
Research bases Tokyo, Yamaguchi
U.S.A.
Fibers & Products

Manufacturing

Ehime, Ishikawa, Fukui, Niigata, Gifu, Shiga, Hyogo, Yamaguchi,

Converting

bases

Hiroshima, Shimane, Fukuoka
China, Thailand, Vietnam, Germany, Hungary

Operation bases Tokyo, Osaka, Aichi, Niigata, Fukui
U.S.A., Germany, China, Thailand, Vietnam, Myanmar, Indonesia, Mexico
Research bases Ehime
China, Thailand
IT

Operation bases Tokyo, Osaka, Kanagawa, Fukuoka

OthersManufacturing

Aichi

bases
Operation bases Tokyo, Osaka Aichi, Ehime, Yamaguchi
Research bases Aichi,
Note: The function of headquarters is indicated in The Company, and the manufacturing, operation and research bases areindicated in each business segments.

46

(8) Employees

Business segments

154th Fiscal Period

155th Fiscal Period

FY2019FY2020(As of March 31, 2020) (As of March 31, 2021)(Current period)

Change in thenumber of
employees

Materials

8,833

9,816

+983

HealthCare

3,505

3,508

+3

Fibers & Products Converting

5,745

5,552

△193

IT

735

743

+8

Others

1,257

1,471

+214

20,07521,090+1,015

Total

Note 1: The number of employees stated above represents the numbers of employees in each segment.
Note 2: The number of employees stated above does not include temporary employees(2,545 employees for the 154th fiscal period and 2,245 employees for the 155th fiscal period)47

(9) Significant Subsidiaries(As of March 31, 2021)
Business segments

Subsidiary (Location of

CapitalThe Head Office)High-

Teijin Aramid B.V.

performance (the Netherlands)materials

Teijin Corporation (Thailand)Materials(Germany)

Principal businessratio (%)
0.02 million ※100.00
euro2,367 million ※100.00

Limited (Thailand)
Teijin Carbon Europe GmbH

Investmentbaht
0.026 million ※100.00
euro

Production and sales of paraaramid fibers
Production and sales ofmeta -aramid fibers and resin
Production and sales of carbon
fibersTeijin Carbon America, Inc.

US$97.5 ※100.00

Processing and sales of carbon(U.S.A.)millionfibers, Production and sales of
Oxidized PAN fibers

Composites

Teijin Polycarbonate China

720 million

Ltd. (China)
Teijin Chemicals Plastic
Compounds Shanghai Ltd.
(China)RMB
143 million

100.00resin
100.00

RMB
US$830 ※100.00

Holdings Corporation (U.S.A.)

million

Structural Composites Co., Ltd

Production of polycarbonate
resin compoundContinental Structural Plastics
CSP Victall (Tangshan)

Production of polycarbonate

595 million ※100.00
RMB

Production and sales ofComposite products
R&D, manufacture and sale ofComposite materials andfinished products(China)Healthcare

Teijin Pharma Limited¥10,000(Tokyo)million100.00

Production and sales of
medicinal drugs and medical
equipment

Teijin Home Healthcare Ltd(Tokyo)¥100 ※100.00
millionInformation provision activities
for pharmaceutical products andHome health care services
provider48

Business segments

Subsidiary (Location of

CapitalInvestment

The Head Office)ratio (%)

Fibers & Products Teijin Frontier Co., Ltd¥2,000Converting(Osaka)millionNantong Teijin Co., Ltd.

¥4,000(China)millionTeijin (Thailand) Limited

IT
Others100.00100.00Limited (Thailand)baht

Teijin Logistics Co., Ltd.

¥80

(Osaka)million

Infocom Corporation¥1,590(Tokyo)millionTeijin Engineering Ltd.

¥475

(Osaka)millionJapan Tissue Engineering Co.,

¥4,959Ltd.(Aichi)

million

Production and sales ofpolyester textile goodsbaht
548 million

Production and sales of textiles
and others

800 million ※100.00(Thailand)
Teijin Polyester (Thailand)

Principal business

Production and sales ofpolyester fibers

67.61

Production and sales ofpolyester fibers

100.00Transportation and custody of
goods

57.99

Development and sales ofcomputer software, etc.

100.00Engineering services, design andsales of plants and equipment

57.72

Development, Manufacturing,
Sales, and Custom
Development/Manufacturing forRegenerative Medicine andRelated Products

Note 1: The Teijin Group has 101 consolidated companies including the aforementioned 18 significant subsidiaries;
66 companies are accounted for via the equity method.
Note 2: ※ indicates the investment ratio including investment by subsidiaries.

(10) Primary Lenders and Amount of Borrowings(As of March 31, 2021)
Primary Lenders

Balance of borrowings
Millions of yen

MUFG Bank, Ltd.

118,247

Mizuho Bank, Ltd.

33,474Development Bank of Japan Inc.

25,000Note 1: The balance of borrowings includes loans from overseas affiliate banks of the Primary Lenders.
Note 2: In addition to loans indicated in the balance of borrowings above, the Company borrows ¥100,642 million
under syndicated loans.

(11) Acquisition or disposal of shares or other interests of other companies or stock acquisition rights,
etc.
1) Regarding CSP Victall (Tangshan) Structural Composites Co., Ltd. (hereinafter, “CSP-Victall”), which was an49

equity-method affiliate of Continental Structural Plastics Holding Corporation (hereinafter, “CSP”), a consolidated
subsidiary of the Company, through a 49.4% stake being held by CSP, it was decided that another consolidated
subsidiary of the Company, Teijin (China) Investment Co., Ltd., would acquire the stake in CSP-Victall held byQingdao Victall Railway Co., Ltd. (hereinafter, “Victall”), thereby making CSP-Victall a wholly-owned subsidiary,
and Teijin (China) Investment Co., Ltd. concluded an agreement with Victall for the transfer of its stake in CSPVictall on December 14, 2020. Acquisition of the shares was completed on December 29, 2020, making CSP-Victall aconsolidated subsidiary of the Company.
2) At the Board of Directors meeting held on January 29, 2021, the Company resolved to acquire shares of common
stock in Japan Tissue Engineering Co., Ltd. (hereinafter, “J-TEC”) through a tender offer under the Financial
Instruments and Exchange Act for the main purpose of making it a consolidated subsidiary, and conducted the tender
offer during the period from February 1, 2021 through March 2, 2021 as the acquisition period. As a result of thetender offer, as of March 9, 2021, acquisition of 57.7% of issued shares was completed, making J-TEC a consolidated
subsidiary of the Company.

50

2. Matters Regarding the Shares of the Company (as of March 31, 2021)(1) Authorized shares

600,000,000 shares(2) Issued shares

197,953,707 shares(3) Number of shareholders

82,807(4) Top 10 shareholders of the Company
Shareholders

Investment in the Company
Number of shares held

Shareholding ratio (%)

1

The Master Trust Bank of Japan, Ltd. (Trust account)

18,213,800

9.48

2

Custody Bank of Japan, Ltd.

10,908,900

5.68

3

Nippon Life Insurance Company

7,045,501

3.66

4The Employee Stock Ownership Association of Teijin

5,565,254

2.89

5

Custody Bank of Japan, Ltd. (Trust account 7)

4,389,600

2.28

6

SSBTC CLIENT OMNIBUS ACCOUNT

2,958,990

1.54

7

MUFG Bank, Ltd.

2,897,287

1.50

8

Custody Bank of Japan, Ltd. (Trust account 5)

2,826,800

1.47

9State Street Bank West Client ₋ Treaty 505234

2,815,851

1.46

10 State Street Bank And Trust Company 505103

2,610,717

1.35

Note: The shareholding ratio has been calculated after excluding Treasury stocks (5,975,760 shares) from theIssued shares.

51

3. Stock Acquisition Rights(1) Overview of Stock Acquisition Rights as Stock Options① Number of stock acquisition rights
The maximum number of stock acquisition rights allocated to Directors for one year from the date of the Ordinary General
Meeting of Shareholders each year is 200.
② Amount to be paid-in for stock acquisition rights
The fair value of stock acquisition rights shall be calculated using the closing price on the allotment date based on the BlackScholes model.
③ Number of shares to be issued upon exercise of stock acquisition rights
The number of shares to be issued upon exercise of one stock acquisition right (hereinafter the “number of shares to be
granted”) shall be 200 shares. However, if the Company conducts a stock split or stock consolidation, or if there are otherunavoidable reasons that require some adjustment, the adjustment shall be made reasonably.
④ Value of property to be invested upon exercise of the stock acquisition rights
The amount of money to be paid-in per share issued or transferred by exercising the stock acquisition rights shall be ¥1, andthe amount of money to be paid-in upon exercise of the stock acquisition rights shall be the said amount multiplied by the
number of shares to be granted.
⑤ Exercise period of stock acquisition rights
Exercise period shall be 20 years from the allotment date of stock acquisition rights.
⑥ Restrictions on transfer of stock acquisition rights
Any acquisition of stock acquisition rights shall require approval of the Board of Directors of the Company.
⑦ Main provisions for acquisition of stock acquisition rights
If a proposal for approval of a merger agreement in which the Company becomes the absorbed company, a proposal for
approval of a share exchange agreement in which the Company becomes a wholly owned subsidiary, or a proposal for sharetransfer is approved at a General Meeting of Shareholders of the Company, the Company can acquire stock acquisition rights
without contribution.
⑧ Main conditions for exercising stock acquisition rights
Stock acquisition rights holders may exercise stock acquisition rights for only five years from the date of loss of position as a
Director of the Company, its subsidiaries and its affiliates.
⑨ Other details pertaining to stock acquisition rights (including other matters from those in ① – ⑧ above)
Determined by resolution of the Board of Directors.

52

(2) Status of Stock Acquisition Rights as stock option as of the last day of the subject Fiscal Yearas a consideration for the execution of the duties
Issue Price ofStock Option(per share)

Exercise Price ofStock Option(per share)

Time of Issue (Issue date)

Number ofIssued Stock
Option (unit)

Class and Number of Shares(Common Stock) to beacquired by the Stock Option

5th (Jul. 10, 2006)

146

29,200¥3,315¥1 Jul. 10, 2006~Jul. 9, 2026

6th (Jul. 5, 2007)

207

41,400¥3,050¥1 Jul. 5, 2007~Jul. 4, 2027

7th (Jul. 7, 2008)

328

65,600¥1,535¥1 Jul. 7, 2008~Jul. 6 ,2028

8th (Jul. 9, 2009)

420

84,000¥1,265¥1 Jul. 9, 2009~Jul. 8, 2029

9th (Jul. 9, 2010)

349

69,800¥1,305¥1 Jul. 9, 2010~Jul. 8, 2030

10th (Mar. 12, 2012)

737

147,400¥1,225¥1 Mar. 12, 2012~Mar. 11, 2032

11th (Mar. 15, 2013)

698

139,600¥980¥1 Mar. 15, 2013~Mar. 14, 2033

12th (Mar. 14, 2014)

618

123,600¥1,140¥1 Mar. 14, 2014~Mar. 13, 2034

13th (Mar. 18, 2015)

379

75,800¥1,925¥1 Mar. 18, 2015~Mar. 17, 2035

14th (Mar. 16, 2016)

274

54,800¥1,800¥1 Mar. 16, 2016~Mar. 15, 2036

15th (Mar. 17, 2017)287

57,400¥1,955¥1 Mar. 17, 2017~Mar. 16, 2037

16th (Mar. 16, 2018)

294

58,800¥1,732¥1 Mar. 16, 2018~Mar. 15, 2038

17th (Mar. 18, 2019)

321

64,200¥1,627¥1 Mar. 18, 2019~Mar. 17, 2039

18th (Mar. 16, 2020)

266

53,200¥1,138¥1 Mar. 16, 2020~Mar. 15, 2040

19th (Mar. 15, 2021)

394

78,800¥1,725¥1 Mar. 15, 2021~Mar. 14, 2041

Period during which the Stock
Option may be exercised

Of the above, total number of unexercised Stock Option held by Directors and Statutory Auditors of theCompany (breakdown by each issue of the Stock Option)(As of March 31, 2021)
Directors
Statutory Auditors
Number of
Issue
Number of Directors
Number of Units
Number of Units
Statutory Auditors
Holding Rights
Holding Rightsth
The 8 Issue of the Stock Option
5
1－－
The 9th Issue of the Stock Option

5

1

－

－

The 10 Issue of the Stock Option

13

1

－

－

The 11th Issue of the Stock Option

30

2

－

－

The 12th Issue of the Stock Option

41

3

－

－

The 13th Issue of the Stock Option

47

3

－

－

The 14th Issue of the Stock Option

47

4

－

－

The 15th Issue of the Stock Option

54

5

7

1

The 16th Issue of the Stock Option

61

5

8

1

The 17th Issue of the Stock Option

82

5

10

1

The 18th Issue of the Stock Option

71

5

8

1

The 19th Issue of the Stock Option

115

5

－

th

Note 1: No Stock Option is granted to any Outside Directors and Statutory Auditors.
Note 2: The Stock Option held by the Statutory Auditor was distributed as a consideration of performance of duties as
Corporate Officer prior to assuming the position of Statutory Auditor.

53

(3) Stock Option distributed during the subject Fiscal Year
Stock Option distributed during the subject Fiscal Year is stated in the 19th Issue of the Stock Option noted in (1) above.
Status of Stock Option distributed to employees of the Company in the 19th Issue of Stock Option.
No. of Unites
No. of Recipients279
20(4) Other important matters concerning Stock Acquisition Rights
Outlines of the Zero Coupon Convertible Bonds due to 2021 (bonds with stock acquisition rights), that were issued
based on the resolution of the meeting of the Board of Directors held on November 26, 2014 are stated below.
Title
The total amount ofdebenture
Issue date
Redemption fixed date
Number of stock acquisitionrightsType of shares to be issued
upon exercise of stockacquisition rights
Number of shares to beissued upon exercise of stockacquisition rights
Conversion price
The contents and the valueof the assets invested on theoccasion of use of the stockacquisition rights
Exercise period of stockacquisition rights

Zero Coupon Convertible Bonds due
to 2021
20 billion yen
December 12, 2014
December 10, 2021
2,000 units
Common shares of the Company
The number is determined by
dividing the aggregate principal
amount of the bonds upon exercise of
the stock acquisition rights by theconversion price¥ 1,840.1 per share (subject toadjustment in certain
circumstances)
In case of the use of the stockacquisition rights, the Bond holder
will invest the bonds upon exercise of
the stock acquisition rights and theBonds price will equal to the facevalue price.
Between December 26, 2014 andNovember 26, 2021

Note: The proposal to pay out ¥25 per share for the year-end dividend was approved at the board of directors meeting on
May 11, 2021. The dividend payout for the previous fiscal year was ¥50 per share, and as a result the conversion priceis being adjusted. (Effective date: As of April 1, 2021)

54

4. Corporate Governance System
Overview
The Teijin Group realizes that its basic mission as a company is to ensure sustainable growth in shareholder value.
On this basis, in order to fulfill our responsibilities to other various stakeholders, we are striving to strengthen
corporate governance. Basic elements of corporate governance are the aim of enhancing transparency, ensuring
fairness, accelerating decision-making, and ensuring monitoring and supervision independence. We are working toestablish and strengthen an effective corporate governance system through “Advisory Board”, “Executive officer
system and board of directors including independent outside directors” and “Auditor system including independent
outside corporate auditors”.
(As of March 31, 2021)

Note: From April 1, 2021, Nomination Advisory Committee and Compensation Advisory Committee are composed of 1
internal and 4 outside.

(1) Reasons for Choosing the Current Corporate Governance System
The Company’s Group has adopted and will adopt from time to time mechanisms for corporate governance which isappropriate for achieving the purposes of the Company. Accordingly, the Company will timely review the mechanisms
and such changes may be made in accordance with changes in the social and legal environments.
The current Companies Act requires the Board of Directors to appropriately carry out two functions: important businessdecision and management oversight and supervision. The governance system deemed appropriate is therefore based onthese two core functions, with execution of business led by the Company’s inside directors (limited to Executive
Directors) on the one hand, and management oversight and supervision focused on by outside directors and carried out by
statutory auditors and the Board of Statutory Auditors on the other hand.
Therefore the Company intends to continue to be a company with Board of Statutory Auditors for the time being. At theCompany, the strengthening of the management oversight and supervisory functions and similar corporate governancethat are the aim of a “company with nominating committees” are effectively achieved via an “Advisory Board”, a “Boardof Directors and executive officer system that includes independent outside directors,” and a “Board of Statutory Auditors
system that includes independent outside statutory auditors.”(2) Outline of Current System
1) Board of Directors
The Board of Directors meets decide or approve important matters such as the management policy and overall planof the entire Teijin Group, in addition to the matters stipulated in laws and regulations and the Articles ofIncorporation, and supervise the execution of duties by directors.
55

To expedite decision making and clarify accountability of execution of business, the Company’s Articles ofIncorporation set the maximum members of the Board of Directors to 10 directors, and the Company has introduceda corporate officer system that delegates broad authority to corporate officers. Currently, the Company’s Board of
Directors comprises nine (9) members. There are four (4) members outside directors who satisfy all therequirements of Independent Director stipulated by the Company with one of whom is a female director. The
Articles of Incorporation sets the term of office for directors at one year.
The Board of Directors is chaired by the chairman of the Company (in the case of vacant of the chairman of theBoard, the director of senior advisor or the outside director will take the chairmanship of the Board). Currently, theBoard of Directors is chaired by an outside director.
Note: The rules of the Board of Directors have been revised on April 1, 2021. The Chairman of the Board of
Directors will be selected from outside directors.
2) Advisory Board (Management Consultative Committee)
The Advisory Board, comprising both Japanese and non-Japanese experts, has been established to provide advice tomanagement in general and to evaluate the top managements, and operates as a consultative body to the Board of
Directors. The Advisory Board is made up of five to seven outside advisors (current four outside directors and two nonJapanese advisors) as well as the Chairman of the Board (in the case of vacant of the chairman of the Board, the senioradvisor), and the President & CEO, and the Chairman of the Board (in the case of vacant of the chairman of the Board,
the senior advisor), chairs the Advisory Board.
However Nomination Committee and Compensation Committee are set up on the Advisory Board The outside director
chairs the committee. The committee functions alternation of the CEO, nomination of a successor, deliberating theselection of Chairman, deliberating the system and levels of compensation for Teijin Group directors, and evaluating theperformance of the CEO. In principle, for matters concerning CEO, CEO leaves the room and does not participate in thediscussion. For matters concerning the chairman, the chairman leaves the room and does not participate in the discussion.
3) Nomination Advisory Committee and Compensation Advisory Committee as consultative bodies
The Nomination Advisory Committee and the Compensation Advisory Committee, as consultative bodies of the Boardof Directors make proposals and recommendations to the Board of Directors with respect to the appointment / retirement,
evaluation and amount of compensation of Directors and the Senior Management other than the Chairman and CEO andthe appointment / retirement of Statutory Auditors.
Both committees are made up of two outside directors, the Chairman of the Board (Vacant seat if absent) and thePresident & CEO. Outside Director chairs both committees. The chairman will be the chairman of the advisorycommittee.
Note: Nomination Advisory Committee Regulation and Compensation Advisory Committee Regulation wererevised on April 1, 2021. The advisory committee consists of all outside directors (currently 4 members),
chairman of the board (vacant seats if absent), and CEO.
4) Board of Statutory Auditors
The Company’s Board of Statutory Auditors consists of five members, of who, three—a majority—are independent
outside directors satisfy all the requirements of Independent Statutory Auditor stipulated by the Company, and one ofthose three is female. In order to enhance the effectiveness of group-wide oversight, the Committee of Teijin Group
Statutory Auditors which comprises statutory auditors of Group companies and other members is regularly held. TeijinGroup Auditors Office which is under the direct control of full-time corporate auditors, has been established as anorganization to assist the duties of corporate auditors, and as of March 31 2021, five (5) full-time staff members havebeen assigned.
5) Internal Audit System
The Corporate Audit Department, reporting directly to CEO, has been established as an internal audit organization, andcarries out Group-wide and global audits to evaluate efficiency and validity of internal control functions. Furthermore, atcertain listed subsidiaries and so forth, individual internal audit organizations have been established. As of March 31,
2021, the number of internal auditors in the Teijin Group is 22 (excluding internal auditors at listed subsidiaries and soforth).
6) Status of Accounting Audits
The status of certified public accountants who executed business is as follows (items in brackets are the affiliated auditing
firm and number of consecutive years performing audits).
Hidetoshi Fukuda (KPMG AZSA LLC, 2 years), Kiyoshi Hirai (KPMG AZSA LLC, 7 year), Takeharu Kirikae (KPMG
AZSA LLC, 6 years).
The status of assistants who executed auditing is as follows.
Certified public accountants 11, others 16, total 27.
567) Total Risk Management
The Company has in place a Total Risk Management (TRM) system targeting both strategic and operational risks, as apreventative measure against any risks that the Company may face, and the TRM Committee has been conducting total
risk management. The TRM Committee, chaired by the CEO, serves under the Board of Directors. The Board of
Directors deliberates and decides the basic policy and annual plan related to TRM proposed by the TRM Committee. At
the same time, the Board Directors formulates our stance on managing important risks and ensuring business continuity.
Also, the statutory auditors conduct audits to check whether the Board of Directors is appropriately conducting policy
decisions, supervising, and monitoring regarding TRM* The details of Teijin Group “Corporate Governance Guide” (the Company’s Corporate Governance System) can be viewed at
the Company’s Web site: (https://www.teijin.com/ir/management/governance/guide/)(3) Evaluation of the Effectiveness of the Board of Directors
In order to further ensure the effectiveness and enhance the functions of the Board of Directors, the Company conducts
an analysis and evaluation of the effectiveness of the entire Board of Directors (hereinafter, the “Board of Directors
Effectiveness Evaluation”) once a year. The method of the Board of Directors Effectiveness Evaluation for FY2020 andan overview of the results are as follows.
1) Analysis and Evaluation Method①A Named self-evaluation questionnaire was conducted for all Directors and Statutory Auditors (14 including Outside
Directors and Outside Statutory Auditors), making reference to advice from external experts. In addition, interviews wereconducted for certain Directors and Statutory Auditors (4) by external experts based on the self-evaluation questionnaires,with the aim of delving into management issues that should be discussed by the Board of Directors and formulating
specific action plans for addressing the issues. Furthermore, with the assistance of external experts, the Board of
Directors secretariat created a summary of the questionnaire and interview results, which formed the basis of a discussion
within the Board of Directors regarding the effectiveness of the Board of Directors, issues to be addressed, andimprovement measures.
②The evaluation points in the questionnaire (40) were compiled from the following eight fields. Respondents evaluated40 points on a five-step scale and made comments (free writing).
(a)Strategies and execution thereof(b) Risk and crisis management(c)
Corporate ethics(d) Performance monitoring(e)Organization and business restructuring-related transactions(f)Management team evaluation, compensation, and succession planning(g) Stakeholder dialogue(h) Composition and operation of the Board of Directors2) Overview of Results of the Board of Directors Effectiveness Evaluation① Summary
The result of the Board of Directors Effectiveness Evaluation conducted by the above process found that there is no
issue with the current corporate governance system and its implementation, and the Company’s Board of Directors is
generally functioning properly and ensuring effectiveness. In addition, the questionnaire result also indicated that there
was a high ratio of positive evaluations for all items.
② Status of response to issues recognized in the previous fiscal year(a) Deepening discussion regarding new business creation
At Board of Directors meetings during the current fiscal year, we established a forum for discussion on the “utilization
status of digital technology” and “innovation promotion activities.” We ascertained the utilization status of digitaltechnology for each business and function, and the status of innovation promotion activities by corporate organizations. It
was confirmed that further discussion is needed from the perspective of data and digital strategy direction and value
creation from the customer’s perspective.
(b) Deepening discussion regarding the rationality of public listing of parent and subsidiaries
At Board of Directors meetings during the current fiscal year, we established a forum for discussion on “studying therationality of public listing of parent and subsidiaries, and examining possible options.” From the perspective of
maximizing the corporate value of the Group and Infocom Corporation, we affirmed the rationality of maintaining thelisting of Infocom Corporation, as well as sharing possible options in the event of elimination of public listing of theparent and the subsidiary.
In addition, it was resolved to acquire the shares of Japan Tissue Engineering Co., Ltd. through a tender offer on thepremise of maintaining the listing of the company, and the resolution was made after confirming the rationality of57

maintaining the listing of the company. The rationality of maintaining the listing of listed subsidiaries I Infocom
Corporation and Japan Tissue Engineering Co., Ltd. will be discussed at FY2021 Board of Directors meetings.
(c) Deepening discussion regarding the positioning of consultative bodies
At Board of Directors meetings during the current fiscal year, we established a forum for discussion on the “directionof institutional design and review of voluntary consultative bodies.” While it was affirmed that being a company with
Board of Statutory Auditors will be maintained for the time being, at the same time, as of April 1, 2021, it was decided
that the Chairman of the Board of Directors will always be an Outside Director. In addition, as of the same date, it was
decided to review the constituent members so that all Outside Directors will participate in the Nomination Advisory
Committee and the Compensation Advisory Committee.
③ Issues recognized in the Board of Directors Effectiveness Evaluation at this time
The following issues were recognized for enabling the Company’s Board of Directors to perform its original function
with greater effectiveness.
(a) Deepening discussion regarding business creation utilizing data, digital technology, etc.
(b) Deepening discussion regarding the business portfolio(c) Deepening discussion regarding issues obtained from the analysis of dialogue with stakeholders(d) Reviewing the agenda of the Board of Directors and enhancing discussion on management strategies
3) Initiatives Going Forward
In FY2021, the Company will continue its initiatives from FY2020. In addition, based on the recent effectivenessevaluation, the Company has decided to further promote the following initiatives as a result of discussion in the Board of
Directors.
(a)Discussion in the Board of Directors about creation of new business(b) Discussion in the Board of Directors about the business portfolio(c)Discussion in the Board of Directors about risk management(d) Discussion in the Board of Directors about the positioning of consultative bodies(e)Discussion in the Board of Directors about stakeholder dialogue and the ideal response to the stakeholders formatters including arguments about the rationality of parent and subsidiary listing
The Company aims to increase the effectiveness of the Board of Directors and further strengthen corporate governancethrough these measures(4) Basic Policy Concerning Cross-Shareholdings
1) Basic Policy Concerning Cross-Shareholdings
The Company holds shares of issuing companies that it has determined to be instrumental in increasing its corporate value
over the medium to long term, with the objective of maintaining and strengthening transactions with them and promoting
business alliances with them. The Board of Directors regularly reviews whether or not it is appropriate to hold shares basedon an examination of the holding purpose and rationale for each individual stock from a medium- to long-term perspective.
In these reviews, the Board of Directors takes into account a comprehensive range of factors, including the significancefrom a management strategy standpoint and business relationships, in addition to weighing dividends, transaction amounts,
and other quantitative impacts against the cost of capital. After these reviews, those shares for which the purpose of holding
has diminished are liquidated, in principle. Through this process, the Company endeavors to reduce cross-shareholdings.
2) Standards for Exercise of Voting Rights Related to Cross-Shareholdings
In exercising the voting rights related to shares that the Company has decided to hold, it confirms each proposal from aperspective of increasing corporate value and shareholder value over the medium to long term and determines whether tovote for or against.

58

5. Directors and Statutory Auditors(1) Directors and Statutory Auditors(As of March 31, 2021)
Post

Name
Jun Suzuki

President,

Duty, state of significant positions concurrently

Participation

held at other companies
CEO (Chief Executive Officer)

The Board of Directors

Representative

Officer, Japan Association of Corporate Executives 12/12(100%)

Director(Keizai Doyukai)

Senior Executive

Yoshihisa Sonobe

CFO (Chief Financial Officer)

The Board of Directors
12/12(100%)

Officer,
Representative
Director
Executive Officer,

Akihisa Nabeshima

President, Healthcare Business of Teijin Group

Director
Executive

12/12(100%)
Officer, *Toshiya Koyama

President, Material Business of Teijin Group

Director
Corporate

The Board of Directors
The Board of Directors
9/9(100%)

Officer, * Eiji Ogawa

Chief Officer, Corporate Strategy

Director
Director

The Board of Directors
9/9(100%)

Fumio Ohtsubo

Panasonic Corporation Special Advisor

The Board of Directors

Trustee, Nippon Life Ins.

12/12(100%)

Director, Kansai University
Trustee, Japan-Indonesia Association, Inc.
Director

Yukako Uchinaga

Board Chair, Japan Women’s Innovate Network

The Board of Directors

President & CEO, Globalization Research Institute 12/12(100%)
Co., Ltd.
Outside Director, HOYA Corporation
Director

Yoichi Suzuki

Adviser to President and Visiting Professor, Chubu The Board of Directors
12/12(100%)

university
Advisory Board Member Amundi Japan Ltd
Director

Masaru Onishi

Outside Director, Mitsui O.S.K. Lines, Ltd...

The Board of Directors

Advisor, Alton Aviation Consultancy Japan Co., 12/12(100%)Ltd. Senior
Visiting Professor, Toyo university
Trustees, International university
Full-time

Masanori Shimai

The Board of Directors

Statutory Auditor

12/12(100%)
The Board of Statutory
Auditors
12/12(100%)
59

Post

Name

Full-time*Akio Nakaishi

Duty, state of significant positions concurrently

Participation

held at other companies
Auditor, Infocom Corporation

Statutory Auditor

The Board of Directors
9/9(100%)
The Board of Statutory
Auditors
9/9(100%)

Statutory Auditor

Gen Ikegami

Representative, Gen Ikegami Certified Public The Board of Directors
Accountant Office, Certified Public Accountant

12/12(100%)

Outside Director, TAC Co., Ltd.

The Board of Statutory

Outside Director, Sumida Corporation

Auditors
12/12(100%)

Statutory Auditor

Hitomi Nakayama

Partner lawyer, Kasumigaseki-Sogo Law Offices

The Board of Directors

Outside Director, Royal Holdings Co., Ltd

12/12(100%)

Director, Public Interest Incorporated Foundation

The Board of Statutory“Automotive Dispute Resolution Center”

Auditors

Auditor, Japan Electric Meters Inspection

12/12(100%)

Corporation
Statutory Auditor*Jun Arima

Professor, Graduate School of Public Policy,

The Board of Directors

University of Tokyo

9/9(100%)

Project Leader, 21st Century Public Policy Institute The Board of Statutory
Consulting Fellow, Research Institute of Economy,

Auditors

Trade and Industry (RIETI),

9/9(100%)

Senior Policy Fellow, Economic Research Instituteof ASEAN and East Asia (ERIA)
Note 1: The directors and statutory auditor marked with * were newly elected at the 154th Ordinary General Meeting of
Shareholders held on June 19, 2020.
Note 2: Four (4) Directors—Fumio Ohtsubo, Yukako Uchinaga, Yoichi Suzuki and Masaru Onishi —are outside
directors. The Company requires the candidate for outside director to satisfy the requirements of “Independent
Director” stipulated by the Company. These four (4) Directors satisfied all such requirements and maintained
their independence throughout the relevant fiscal year. Because they also satisfy the requirements of
independence as stipulated by Tokyo Stock Exchange Group, Inc., they were registered by the Company as“Independent Director/Auditor” at the stock exchanges. The contents of the requirements of “Independent
Director” stipulated by the Company can be viewed at the Company’s Web site:(https://www.teijin.com/ir/management/governance/requirements/).
Note 3: There are no important interests between the Company and any of the entities at which the above mentioned
outside directors hold positions as director/statutory auditor etc.
Note 4: Three (3) Statutory Auditors— Gen Ikegami, Hitomi Nakayama and Jun Arima—are outside statutory auditors.
The Company requires the candidate for outside statutory auditor to satisfy the requirements of “Independent

60

Statutory Auditor” stipulated by the Company. These three (3) Statutory Auditors satisfied the all said
requirements and maintained their independence throughout the relevant fiscal year. Because they also satisfy
the requirements of independence as stipulated by Tokyo Stock Exchange Group, Inc., they were registered by
the Company as “Independent Director/Auditor” at the stock exchanges. The contents of the requirements ofIndependent Auditor” stipulated by the Company can be viewed at the Company’s Web site:(https://www.teijin.com/ir/management/governance/requirements/).
Note 5: There are no important interests between the Company and any of the companies at which the above mentioned
outside statutory auditors hold positions as director/ statutory auditor etc.
Note 6: Full-time Statutory Auditor Masanori Shimai and Statutory Auditor Gen Ikegami is nave ample knowledge offinance and accounting as described below:
Full-time Statutory Auditor Masanori Shimai has been involved in finance and accounting-related work formany years at the finance and accounting-related department of the Company.
Statutory Auditor Gen Ikegami is qualified as Certified Public Accountant.
Note 7: Statutory Auditor Hitomi Nakayama is qualified as a lawyer and has ample knowledge of compliance and risk
management.
Note 8: The following Directors and Statutory Auditor retired as of June 19, 2020.
Director

Kazuhiro Yamamoto

Director

Yasumichi Takesue

Statutory Auditor

Noriaki Endo

Statutory Auditor

Nobuo Tanaka

Note 9: Changes in posts and duties of Directors during the subject fiscal year are as follows.
Name
Yoshihisa Sonobe

New Post

Former Post

Date of Change

Representative Director,

Senior Executive Officer, Director

Senior Executive Officer,

CFO (Chief Financial Officer)

April 1, 2020

CFO (Chief Financial Officer)
Toshiya Koyama

TeijinGroup

Executive

Officer, Teijin

Group

Executive

Officer April 1, 2020

President, Material Business of Teijin General Manager, Material Business
Group

Group

Executive Officer, Director,

TeijinGroup

Executive

Officer June 19,2020

President, Material Business of Teijin President, Material Business of Teijin
Eiji Ogawa

Group

Group

Corporate Officer, Director,

Teijin Group Corporate Officer

Chief Officer (Corporate Strategy)

Chief Officer (Corporate Strategy)

61

June 19,2020

Note 10: Changes in posts and duties of Directors following the subject fiscal year are as follows.
Name
Yoshihisa Sonobe

New Post

Former Post

Director

Representative Director,

Date of Change
April 1, 2021

Senior Executive Officer
CFO (Chief Financial Officer)
Akihisa Nabeshima

Representative Director

Executive Officer,

Executive Officer

Director

CFO (Chief Financial Officer)

President, Healthcare Business ofApril 1, 2021

Teijin Group
Toshiya Koyama

Executive Officer, Director,

Executive Officer, Director,

Chief Social Responsibility Officer

President, Material Business of Teijin

Responsible for Corporate Audit

Group

April 1, 2021

Department
Eiji Ogawa

Executive Officer, Director,

Corporate Officer, Director,

Chief Officer (Corporate Strategy)

Chief Officer (Corporate Strategy)

April 1, 2021

(2) Liabilities Limitation Agreements
The Company has executed a Liabilities Limitation Agreement with each of four (4) outside directors,
Fumio Ohtsubo, Yukako Uchinaga, Yoichi Suzuki and Masaru Onishi and each of five (5) statutory auditors,
Masanori Shimai, Akio Nakaishi, Gen Ikegami, Hitomi Nakayama and Jun Arima which limits the respective
liabilities of each director and statutory auditor to the higher amount of ¥20 million or the minimum liability
amount stipulated in Article 425, Paragraph 1, of the Companies Act.

(3) Remuneration, etc. for Directors and Statutory Auditors, etc.
1) Method of Determining Policy for Determining Content of Remuneration, etc., for Individual Directors andOverview of the Policy
An overview of the content of the policy for determining remuneration, etc., for individual directors and overview of thepolicy is as follows. Additionally, this determination policy is determined via a resolution of the Board of Directors after
deliberation in the Advisory Board and the Compensation Advisory Committee.
Activities in committees, etc., for deliberation and determination of remuneration, etc., for Directors during the fiscal year
under review were as follows.
Board of Directors: 4 meetings; Advisory Board: 2 meetings; Compensation Advisory Committee: 5 meetings
One of the two Advisory Board meetings and four of the five Compensation Advisory Committee meetings held during
the fiscal year under review were held to deliberate on new systems for remuneration, etc., for directors for FY2021
onward.
① Basic policy for compensation systems
・The system should enhance awareness of contributing to medium- to long-term increase in earnings and corporate value
・The system should be closely linked to company results, and highly transparent and objective
・Be primarily focused on enhancing shared awareness of interests with shareholders and shareholder-focused managementawareness
62

・The system should maintain sufficient remuneration levels to secure high-quality management human resources② Remuneration level
・ The remuneration level for internal directors and outside directors is determined each year after verifying theappropriateness of the level of total remuneration for each position, based on the results of a remuneration survey
conducted among major corporations in Japan each year.
③ Composition of remuneration, etc. for directors and statutory auditors
・Internal director remuneration is composed of fixed basic remuneration, not linked with the performance of the Company,
variable performance-based remuneration (short-term incentive remuneration), and stock acquisition rights as stock
options (medium- to long-term incentive remuneration), with the aim of instilling awareness of short-term achievementof performance goals and medium- to long-term improvement of corporate value.
・Remuneration for outside directors and statutory auditors is solely fixed remuneration, not linked with the performanceof the Company.
④ Composition ratio of remuneration
For internal directors, the composition ratio is as follows.
Fixed
remuneration
Basic
remuneration(Cash)
60%

Variable remuneration
Performancebased
remuneration(Cash)
25%

Total remuneration

Stock acquisition rights
as stock options

15%

100%

Note1: Ratios of Performance-based remuneration and Composition-type stock option are ratios if achieving standard figures from among gradedtargets, and increases or decreases depending on actual levels of achievement.
Note2: Upon deliberation in the Advisory Board and the Compensation Consultation Committee, the ratio of basic remuneration will be reduced
from FY2020 onward, and of the remuneration ratios for the previous fiscal year (FY2019), the Board of Directors determined to modify
basic remuneration from 65% to 60%, and stock acquisition rights as stock options from 10% to 15%.

⑤Performance indicators for performance-based remuneration

Three indicators are presented as performance evaluation indicators concerning variable remuneration for the mediumterm management plan for 2020-2022, “ALWAYS EVOLVING,” have been selected as key performance indicators(KPIs) for : consolidated ROE, which is a profitability indicator; consolidated EBITDA, which is a growth indicator;
and ROIC based on consolidated operating income, which is an indicator of efficiency of generating profits relative tocapital invested. And the consolidated ROE, which is a profitability indicator; consolidated EBITDA, which is a
growth indicator are presented as performance evaluation indicators concerning compensation-type stock option;
Their selection will motivate each director to improve the KPIs.
⑥ Policy on determining timing and conditions for providing remuneration, etc.
(a) Basic remuneration:
The amount paid to each director is determined according to their position and paid as fixed remuneration.
63

1/12 of a fixed amount by position is provided as monthly remuneration.
(b) Performance-based remuneration:
The payment ratio and standard amount of performance-based remuneration by position is calculated depending on
the target achievement level of consolidated ROE, the achievement versus forecast of consolidated EBITDA andconsolidated ROIC based on consolidated operating income, and the individual performance evaluation of thedirector, and provided by the end of June as a year-end lump sum.
(c) Stock acquisition rights as stock options:
The Company’s stock options are designed based on a compensation-type stock option plan where the exercise priceis ¥1 (the stock option recipient pays ¥1 per stock). The number of stock options allocated varies depending on thetarget achievement level of consolidated ROE and the achievement versus planned consolidated EBITDA. Moreover,
the allocated stock options have a condition that allows the recipient to exercise the options within a five-year period
after retiring as a director. Every February, amounts are determined based on the projected level of achievement for
consolidated ROE and the projected level of target achievement for versus planned consolidated EBITDA, withpayment provided by the end of March.
An overview of stock acquisition rights as stock options is as stated in “3. Stock Acquisition Rights (1) Overview
of Stock Acquisition Rights as Stock Options”.
⑦ Matters regarding delegation of determining remuneration, etc. for individual directors
No applicable matters.
⑧ Other significant matters regarding determining content of individual remuneration, etc.
The Advisory Board deliberates on the remuneration of CEO, and the Compensation Advisory Committee deliberates
on the remuneration for directors other than CEO. After the deliberations, proposals are presented to the Board of Directors,
which gives full consideration to the proposals before passing a resolution.
2) Reasons the Board of Directors Determined the Content of Remuneration, etc., for Individual Directors for the
Fiscal Year Under Review Conform to the Determination Policy
In determining the content of remuneration, etc., for individual directors, the Advisory Board deliberated on the
remuneration of CEO, and the Compensation Advisory Committee deliberated on the remuneration of directors other thanCEO. The Advisory Board and the Compensation Advisory Committee made considerations including the original proposal’s
conformity with the determination policy. As a result, the Board of Directors generally provided adequate consideration to
the proposal and has judged that the process conformed with the determination policy.
3) Resolutions of Ordinary General Meeting Regarding on Remuneration, etc. for Directors and Statutory Auditors,
etc.
The maximum annual remuneration, etc. for directors of the Company has been ¥700 million, as resolved by the 140th
Ordinary General Meeting of Shareholders, held on June 23, 2006 and the 149th Ordinary General Meeting of Shareholders,
held on June 24, 2015. The amount of the above remuneration includes (1) ¥630 million of annual salary, and (2) ¥70 million
for the fair value of stock acquisition rights as stock options. The number of directors as of the conclusion of the Ordinary
General Meeting of Shareholders in June 2006 was ten (10), and the number of directors as of the conclusion of the Ordinary
General Meeting of Shareholders in June 2015 was ten (10) (including four (4) outside directors).
The maximum monthly remuneration for statutory auditors is ¥12 million as resolved by the 133rd Ordinary General64Meeting of Shareholders held on June 25, 1999. The number of statutory auditors as of the conclusion of the above Ordinary
General Meeting of Shareholders was five (5).
4) Remuneration for Directors and Statutory Auditors, etc. for the Fiscal Year Under Review(persons; millions of yen)
Total amount of remuneration, etc., by type
Number of

Total amount
of

Basic

Performance-based

Noncashapplicableremuneration,

remuneration

remuneration, etc.

remuneration,

officers

etc.
Directors

etc.
308

212

57

40

7

72

72

3

Outside directors

66

66

4

Outside statutory

36

36

4

(Excluding outside
directors)

Statutory
auditors(Excluding outside
statutory auditors)

auditors
Note 1: The Company has no director who is also an employee of the Company.
Note 2: Performance-based remuneration, etc., of ¥57 million is the expected amount of performance-based remuneration to be paid by the end ofJune to the five (5) directors appointed at the 154th Ordinary General Meeting of Shareholders held on June 19, 2020. Noncash remuneration,etc., of ¥40 million above is the amount of stock acquisition rights as stock options granted to directors for their duties performed during the
subject fiscal year. Additionally, performance-based remuneration and stock options were not granted to outside directors.
Note 3: Remuneration, etc., for statutory auditors is determined by deliberation among the statutory auditors.

5) Matters Regarding Performance-based Remuneration, etc.
To provide motivation to improve the KPIs in the medium-term management plan for 2020-2022, “ALWAYS EVOLVING,”
performance-based remuneration is provided to each director as stated in 1) ⑤ with consolidated ROE, consolidated
EBITDA, and consolidated ROIC based on consolidated operating income selected as KPIs, with the amount of performancebased remuneration calculated based on the level of achievement or level of achievement versus forecasts and performanceof the individual director.
KPI results for FY2020 were -1.7% for consolidated ROE, ¥106.8 billion for consolidated EBITDA, and 8.6% for ROIC.
Although consolidated EBITDA and consolidated ROIC based on consolidated operating income exceeded targets,consolidated ROE fell short of the target. As a result, the payment ratio for performance-based remuneration in FY2020 was
60 to 80% versus the standard amounts for performance-based remuneration by position (the amount if the payment ratio
against target level of achievement was 100%).

65

Evaluation indicators

TargetResultConsolidated ROE

10%

△1.7%

Consolidated EBITDA¥91.2 billion¥106.8 billion

Consolidated ROIC based on

6.0%

8.6%

consolidated operating income
Note 1: In view of the global spread of COVID-19, targets for consolidated EBITDA and consolidated ROIC based on consolidated
operating income that are used for the calculation of performance-based remuneration were readjusted in July 2020, and thus thefigures do not match with initially announced results forecasts.
Note 2: The target of Consolidated ROE is set to 10% based on the target of 10% or higher set in the medium-term management plan for
2020-2022, “ALWAYS EVOLVING,” if the results are 10% or higher, the amount which is paid if the target is achieved, is paid. If theresult is higher than the target, the amount of payment increases.)

6) Matters Regarding Noncash Remuneration, etc.
“Stock acquisition rights as stock options” are provided to directors excluding outside directors.
The amount of stock acquisition rights as stock options provided is calculated by multiplying the number of options tobe allotted resolved by the Board of Directors, which is based on the projected level of achievement of consolidated ROE
and projected level of achievement of consolidated EBITDA, by the issue price of stock acquisition rights. The payment
ratio for stock acquisition rights as stock options in FY2020 was 90% versus the standard amounts for stock options
compensation by position (the amount if the payment ratio against target level of achievement was 100%).
The content and state of distribution for stock acquisition rights as stock options is as stated in “3. Stock Acquisition
Rights (2) Stock Acquisition Rights distributed as stock options as consideration for business execution as of the end of the
fiscal year under review”.

(4) Outside Directors and Outside Statutory Auditors
1) Significant Concurrent Positions and the relation between the Company and the entities at which Outside Directors andOutside Statutory Auditors hold such positions.
They are shown in the above-mentioned ”(1) Directors and Statutory Auditors”.

2) Main Activities
Outside Directors

The attendance status of the Board of Directors is shown in the above-mentioned ”(1) Directors and Statutory
Auditors”.

66

Name

Main Activities
Outline of duties performed regarding the roles expected of outside directors
He offered valuable comments from his extensive management experience andknowledge.
He serves as Chairman of the Board of Directors as part of separation ofmonitoring and supervision, and execution. He vitalizes the Board of Directorsof the Company and endeavors to secures effectiveness and improve functionof the Board of Directors of the Company.
As the member of the Advisory Board, and as chairman of Nomination

Fumio Ohtsubo

Committee set up on the Advisory Board, He makes useful statements
regarding CEO compensation and selection etc.
As the Chairman of Nomination Advisory Committee, he makes usefulstatements in selecting candidates for directors and executive officers otherthan the CEO.
As the member of Compensation Advisory Committee, he makes appropriate
statements regarding the compensation of directors and executive officers
other than the CEO.
She offered valuable comments from her wealth of business experience,

Yukako Uchinaga

outstanding insights in the IT field, and a deep understanding of diversity.
As the member of the Advisory Board, she makes useful statements regarding
CEO compensation and selection.
He offered valuable comments from his expertise and knowledge ofinternational economic and trade issues etc. cultivated over many years as a

Yoichi Suzuki

diplomat.
As the member of the Advisory Board, he makes useful statements regarding
CEO compensation and selection.
He offered valuable comments from his extensive management experience andknowledge.
As member of the Advisory Board, and as chairman of Compensation
Committee set up on the Advisory Board, he makes useful statements
regarding the remuneration system for directors and statutory auditors, etc. of
Teijin Group and evaluation of CEO, etc.

Masaru Onishi

As the Chairman of Compensation Advisory Committee, he makes
appropriate statements regarding the compensation of directors and executive
officers other than the CEO.
As the member of Nomination Advisory Committee, he makes usefulstatements in selecting candidates for directors and executive officers otherthan the CEO.

67

・Outside Statutory Auditors

The attendance status of the Board of Directors and Audit & Supervisory Board are shown in the abovementioned ”(1) Directors and Statutory Auditors”.
Name
Gen Ikegami

Main Activities
He offered valuable comments from his professional knowledge as a Certified
Public Accountant.
She offered valuable comments from her professional knowledge as lawyer,

Hitomi Nakayama

and offered, in particular, advice and suggestions concerning compliance andrisk management.
After he was appointed on June 19, 2020, he advised and pointed out the

Jun Arimaenvironmental management that the Company has aimed for, including
maintaining and improving compliance.

68

6. Accounting Auditor(1) Name of Accounting Auditor
KPMG AZSA LLC.
(2) Amount of Remuneration(Millions of yen)

Details

Amount1) The amount of remuneration, etc., to be paid by the Company tothe accounting auditor
2) The total amount of cash or other proprietary interest to be paidby the Company and its subsidiaries to the accounting auditor

172
288

Note 1: The amount described in Item 1) of the above table is the total sum of the remunerations for audits under theCompanies Act and the remuneration for the audits under Financial Products & Exchange Act in Japanbecause these are not clearly distinguished from each other in the contract between the Company and the
Accounting Auditor.
Note 2: Of the major subsidiaries of the Company, 11 companies, including Teijin Aramid B.V. , undergo auditing byaccounting firm other than the Accounting Auditor.
Note 3: Based on the Company’s scale and characteristics, the Board of Statutory Auditors has given consent to the
remuneration, etc., to be paid the Accounting Auditor as stipulated in Article 399, Paragraph 1 of the Companies Act, asa result of the confirmation of the audit contents, total audit work done, audit plans of Accounting Auditor and its
rewards estimation.

(3) Policy for Dismissal or Non-Reappointment of Accounting Auditor
The Company has a policy that the Board of Statutory Auditors may dismiss the Accounting Auditor based on theunanimous approval by the statutory auditors in cases where Article 340, Paragraph 1 of the Companies Act is judged
to apply. Furthermore, the Company has a policy of submitting a proposal regarding dismissal of the Accounting
Auditor to a shareholder’s meeting in the event that it is deemed that a grave obstacle to the Company’s audit operation
involving the Accounting Auditor has occurred, and similarly submitting a proposal regarding the non-reappointmentof the Accounting Auditor in the event that it is deemed necessary to change the Accounting Auditor in light of the
Accounting Auditors’ independence and reliability, or the status of its performance of duties.
In both cases, the submission of the proposals is based on a decision of the Board of Statutory Auditors.
7. Policy Regarding the Determination of Dividends from Retained Earnings
Stable and sustainable dividends will be considered, and own share repurchasing will be flexibly conducted as welldepending on the situation. Dividends are in line with consolidated operating results, aiming to raise the dividend alongwith profits growth, and targeting a consolidated payout ratio of 30% of profit attributable to owners of parent for the
medium -to long term.

69

8. Systems to Ensure Appropriate Business Operations and the Status of its Implementation(1) Resolutions on Basic Policies for Establishment of Internal Control Systems
The Company passed a resolution regarding the “Basic Policy for Establishment of Internal Control Systems” at Board of
Directors meeting held on March 30, 2021.
Below is a summary of this resolution, the details of which can be viewed at the Company’s Web site:(https://www.teijin.com/ir/management/governance/).
1) System for Ensuring Compliance with Laws, Regulations and the Articles of Incorporation in the
Performance of Duties by Directors and Employees of the Company and Its Subsidiaries
The Company has declared the basic principles of compliance in its Teijin Group “Corporate Governance Guide”.
To practice these basic principles, the Company shall establish systems and organizational structures that ensure practicaloperation and thorough observation of the Company’s Corporate Philosophy, Corporate Code of Conduct, Group Ethics
Regulations and other related internal regulations.
The Company’s representative directors and other executives shall take the initiative and set good examples in observing
laws, regulations and the Articles of Incorporation, social rules and ethics, and shall promote compliance education andawareness among directors, officers and employees of the Company and its subsidiaries. In order to establish acompliance system across the entire Teijin Group, the Company appoints Chief Social Responsibility Officer as theofficer in charge of compliance.
All directors, officers and employees of the Company and its subsidiaries are required to report to the Teijin entity towhich they belong or to Teijin Limited, when they detect any violations of laws and regulations or other serious
information concerning compliance, in accordance with Group Ethics Regulations and other internal regulations. Chief
Social Responsibility Officer shall direct and supervise investigations to confirm such reported facts and, upon
consultation with CEO (President), determine appropriate measures.
The Company shall provide necessary means for directors, officers, employees and business partners to directly reportany violation or doubtful activities of non-compliance in the Company or its subsidiaries, and will establish and operatevarious reporting and consultation counters. Such measures shall ensure that anonymity of the caller is protected and thatthe caller does not get any disadvantageous treatment. Important reports as well as measures taken by the relevant Teijin
entity and their results shall be announced as appropriate to, and shall be recognized by, all directors, officers andemployees of the Company and its subsidiaries.
The directors of the Company and its subsidiaries shall have their performance of duties audited by the statutory auditors,
and will respect any advice or recommendations received from the statutory auditors.
The Company places Corporate Audit Department directly supervised by CEO, which performs internal auditing of the
Teijin Group’s execution of business and conducts the evaluation of the internal control system and proposes its
improvement.
The Company shall maintain a resolute attitude toward pressure from antisocial forces, including demands for payoffs
from specific shareholders or interference by crime syndicates, and shall not allow such interference. Chief Social
Responsibility Officer shall be appointed as the person in charge of actions against antisocial forces. Chief Social
Responsibility Officer shall establish action policies and other rules in consort with general manager, Human Resources
Division and shall ensure observance of such policies and rules by directors, officers and employees within the Company
and its subsidiaries.
To intensify the validity of the decision to be made by the Board of Directors, in principle, 4 or more of the directors shallbe outside directors satisfying the requirements for independence stipulated by the company.

2) Rules and Other Systems for Management of Risk of Loss in the Company and its Subsidiaries
The Board of Directors of the Company shall operate a total risk management system to deal with any kind of risks thatmight threaten sustainable business development.
Total Risk Management (TRM) Committee, shall mainly deal with the business operational risks and strategic risks to
Teijin Group, and shall propose basic policies and annual plans related to TRM to the Board of Directors of theCompany. Chief Social Responsibility Officer is in charge of establishing a system across the Teijin Group to manage
business operation risk, and shall identify problems and deal with such risks upon occurrence thereof. CEO shall assess
strategic risks and present his/her assessment to the Board of Directors of the Company as an important element uponwhich managerial decisions are made.
Chief Social Responsibility Officer shall establish a system for the Teijin Group to ensure the continuation of businesses
when faced with risk events including disasters, the inappropriate performance of duties by directors, officers or
employees, and damage to critical IT systems.

703) Systems for Ensuring that Duties by Directors and Employees of the Company and Its Subsidiaries Are
Performed Efficiently
The Company shall establish Group regulations to provide the necessary rules and guidelines for the Group to ensure
efficient business operations throughout the Teijin Group.
The Board of Directors of the Company shall have the representative directors and other executives conduct the operationof the Company and decisions for the items on which the representative directors and other executives have beendelegated decision-making powers shall be made by the organization and procedures in accordance with the internal
regulations. These regulations shall be revised as may be necessary to reflect any revision and/or abolition of laws andregulations and/or to increase the efficiency of the representative directors and other executives in executing their duties.
The Board of Directors of the Company shall organize the basic structure of Teijin Group, and shall establish efficientmanagement, oversight and supervision system.
The Company shall formulate the Group medium-term management plan, and each fiscal year it shall formulate shortterm plans, key management targets, and budgets, as well as carrying out progress checks, in order to realize the mediumterm management plan.
4) Systems for Ensuring that Proper Business Operations Are Conducted within Teijin GroupThe Company shall establish Group Regulations to provide the necessary rules and guidelines for the Group to ensure
appropriate business operations throughout the Teijin Group. Based on the Group regulations, each company shallestablish its own regulations, and use appropriate processes for deciding on important matters.
The Company shall discuss important matters concerning Teijin Group companies at its Group meetings and so forth, andto require Teijin Group companies to make reports.
The representative directors and other executives shall provide necessary instructions to ensure that the Teijin Group
entities have appropriate internal control systems.
Corporate Audit Department of the Company shall operate or supervise internal audits of the Teijin Group’ s business
operations and ensure the efficiency and validity of internal control functions over the entire business of the Teijin Group.
Statutory Auditors of the Company shall establish appropriate systems, such as those for close coordination with theaccounting auditors and Corporate Audit Department, to ensure effective and appropriate supervision and auditing of theGroup’s entire business operations.
To ensure the reliability of its financial reporting, the Company shall establish a group-wide internal control system forthe financial reporting and the operation of the Teijin Group individual operational processes, and shall properly andefficiently operate and assesses such systems.
5) Systems for the Preservation and Management of Information in Relation with the Directors’ Performanceof Their Duties
Directors shall appropriately preserve and manage minutes of shareholders’ general meetings, minutes of Board of
Directors’ meetings, and other documents and important information concerning the performance of their duties inaccordance with the internal regulations. CEO is responsible for the supervision and oversight of the preservation andmanagement of such documents and important information. Documents concerning directors’ performance of their duties
shall be preserved for at least ten (10) years and shall be accessible when necessary.
6) Provisions Concerning Employees Assigned to Assist the Statutory Auditors in Performing Their Duties,
the Independence from Directors of Such Employees, and the Validity of Instructions Given to Such
Employees
The Company shall establish Teijin Group Auditors Office under the direct control of full-time statutory auditors andappoint two or more employees, in principle, to assist Statutory Auditors in performing their duties. The members of
Teijin Group Auditors Office may concurrently become statutory auditors of Teijin Group companies; however it shallnot concurrently become corporate officers connected with performance of duties at Teijin Group companies.
To secure the independence of members of Teijin Group Auditors Office above, all decisions concerning personnel
measures regarding the members of Teijin Group Auditors require the prior consent of the full-time Statutory Auditors.
The full-time Statutory Auditors shall assess the performance of the members of Teijin Group Auditors Office.
7) System for Reporting to Statutory Auditors by Directors, Corporate Officers and Employees of theCompany and its Subsidiaries, and System for Other Reports to Statutory Auditors
The full-time statutory auditors shall attend the meetings of the Board of Directors and other important meeting bodies of
the Company, as well as those of the important meeting bodies of the main subsidiaries.
Representative directors and other executives shall report at the meetings of the Board of Directors and other important
meetings on their performance of duties with regard to the business operations, functions and subsidiaries under theircharge.
The directors, officers and employees of the Company and its subsidiaries shall immediately report to the statutory
auditors when they discover incidents that causes or may cause significant erosion of public trust of the Company,
71

adverse effects on the performance of the Company, significant damage to the internal or external environment, safety
and health (ESH); or related to product liability, significant violations of internal regulations, or other similar incidents.
The directors, officers and employees of the Company and its subsidiaries shall report on the business operations,functions, and subsidiaries under their charge, when they deem it necessary to do so, or at the request of the statutory
auditors of the Company, and shall cooperate with the investigations of the statutory auditors of the Company.

8) System for Ensuring that Persons Reporting to the Statutory Auditors Are Not Subject to Unfair
Treatment Because of Such Reporting
The Teijin Group’s Group Ethics Regulations and other regulations stipulate that no person shall be treated unfairly
because of reporting or giving notice of illegal conduct and so forth.
9) Policy Concerning Processing of Expenses and Obligations Arising with Respect to the Statutory Auditors’
Performance of Duties, Prepayment of Expenses, and Reimbursement Procedures
The Company shall bear the expenses and obligations required for the statutory auditors’ performance of duties, and shallpromptly respond to requests for pre-payment of expenses in accordance with laws and regulations after checking therequests.
10) Other System for Ensuring that the Audits of Statutory Auditors Are Conducted Effectively
To ensure transparency, the majority of statutory auditors consists of independent outside statutory auditors that satisfy
the requirements for independence that the Company specifies.
The statutory auditors shall enter into advisory agreements with outside law firms in order for themselves and statutory
auditors of the Company and its subsidiaries to form independent opinions. When they consider it necessary in the courseof conducting audits, the statutory auditors can, at their own discretion, retain outside advisers, including Certified Public
Accountants and other consultants.
(2) Summary of the “Internal Control System Operating Status”
In accordance with the “Basic Policy for the Establishment of Internal Control Systems,” the operating status of theCompany’s internal control system for the relevant year is as follows.
1) Operating Status Regarding Compliance with Laws and Regulations
The Company has published the Teijin Group “Corporate Governance Guide” and the related regulations necessary to
carry out its basic policy on the Company intranet, and has designated each October as Corporate Ethics Month in whichinternal training is held, promoting compliance education and awareness. Furthermore, for important decision making,the related divisions and departments perform verifications, working to prevent any violations of laws and regulations.
The Company has established a framework to promote compliance under the direction of the Chief Social Responsibility
Officer, which works to identify and respond to problems across the Teijin Group. The Chief Social Responsibility
Officer also responds appropriately to important compliance issues reported by the directors, officers and employees of
the Company and its subsidiaries based on the Group Ethics Regulations, which establish rules for reporting illegal
conduct and other responses, and make regular reports to the TRM Committee.
The Company has established an internal reporting system including an anonymous compliance hotline, responding
appropriately to hotline inquiries from group companies in Japan and overseas, protecting the reporter, and publishing thestatus of the response biannually on the intranet, promoting education and awareness.
The Company respects and responds appropriately to points made by Statutory Auditors in audits and in evaluations of
the condition and operational status of internal control systems.
The Company’s Corporate Audit Department performs internal auditing across the Teijin Group based on the annual plan,and reports the audit results to the Directors and Statutory Auditors as necessary.
The Company maintains an action policy against anti-social forces in its Corporate Code of Conduct, and promotes
education and awareness at its Corporate Ethics Month.
2) Operating Status Regarding Management of Risk of Loss
The Board of Directors of the Company receives reports from the TRM Committee on proposals for basic policies andannual plans related to TRM, as well as the status of the occurrence and response to risks, putting in place a system tomanage important risks and ensure the continuation of the business.
The Chief Social Responsibility Officer implements regular evaluation and monitoring of operational risks, continually
identifying risks and evaluating the validity of countermeasures. The Company has formulated “The Manual of Largescale disaster prevention” that assumes the spread of widespread infectious diseases such as Covid-19. This time too, theCompany is setting up Emergency Response Headquarters, prioritizing the safety of employees and their families all over
the world, grasping the status of the entire Teijin Group, implementing various measures, disseminate information to
inside and outside Teijin Group, and procuring relief supplies.
72

At meetings of the Board of Directors and other important meetings of the Company, deliberation items are evaluatedbased on the results of strategic risk assessment implemented based on the internal regulations.
To ensure the continuation of business, the Company will prepare the required manuals and hold regular drills to beprepared in the event of an emergency.
While preparing individual policies on personal information protection and information security, the Company has
implemented various internal education programs and security enhancement policies, as well as enhancing
countermeasures against the risk of information leaks.
3) Operating Status Regarding Securing Efficiency
The Company publishes the Group regulations on the Company intranet, promoting education and awareness.
The Company assigns management systems and job duties as well as clarifying responsibilities and authorities based on
the internal regulations, working to ensure efficient management execution and effective management.
4) Operating Status Regarding the Internal Control System within the Corporate GroupThe Company performs regular self-evaluations of the creation and operating status of its internal control system,
continually guiding the creation of the internal control system including both the regulations and meetings of the various
Teijin Group companies and a reporting system.
The Company’s Statutory Auditors, to promote fair and efficient auditing activities within the Teijin Group, by holding
regular meetings of the Group Board of Statutory Auditors, attending meetings in which accounting audit reports are
given and report of results of internal audits, maintains close cooperation among the Accounting Auditors and Internal
Audit Departments.
5) Operating Status Regarding the Preservation and Management of Information
The Company’s Board of Directors appropriately preserves documents and important information concerning theperformance of their duties in accordance with the internal regulations.
6) Operating Status Regarding Ensuring the Effectiveness of the Auditing of the Statutory Auditors
The Company has established the Teijin Group Auditor Office, with the Teijin Group Auditor Office members under the
direct control of the Statutory Auditors to assist the Statutory Auditors in performing their duties.
The Company’s full-time Statutory Auditors attend important meeting bodies of the Company and of the main
subsidiaries, receiving reports at the meeting bodies from the representative directors, other directors, and corporate
officers on the status of the performance of duties.
The Chief Social Responsibility Officer reports on important stipulated items, including internal reporting by the hotline,
promptly following their discovery, both individually and to the members of the meeting bodies including the Statutory
Auditors, through the important meeting bodies.
Officers and employees of the Company properly respond to items requested by the Statutory Auditors, working to ensure
the effectiveness of the auditing of the Statutory Auditors.

Note: Italicized product names and service names in this report are trademarks or registered trademarks of the TeijinGroup in Japan and/or other countries, or, where noted, are protected as the trademarks and/or trade names of othercompanies.

73

9. Financial Statement(1) Consolidated Balance Sheets
FY2019(As of Mar. 31, 2020)(Millions of yen)
FY2020(As of Mar. 31, 2021)

Total

113,500
167,194
36,00096,935
11,73534,42912,12733,926(523)
505,323

170,185
181,020―
89,693
10,44240,90913,80628,859(334)
534,580

Total

65,037110,956
43,17442,226
34,689296,081

65,088100,467
42,81339,47034,454282,291

Total

23,81336,57460,38739,35534,98974,344

76,633
2,063
31,388
9,578
24,373(1,604)142,432
498,900

84,797
2,098
31,124
4,642
23,754(1,202)
145,212501,847

1,004,223

1,036,427< Assets >Current assets
Cash and deposits
Notes and accounts receivable-trade
Securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Short-term loans receivable
Other current assets
Allowance for doubtful accounts

Noncurrent assets
Tangible assets
Buildings and structures, net
Machinery and equipment, net
LandConstruction in progress
Other, net

Intangible assets
Goodwill
Other

Investments and other assets
Investment securities
Long-term loans receivable
Net defined benefit asset
Deferred tax assets
Other
Allowance for doubtful accounts
Total
Total noncurrent assets
Total assets74

< Liabilities >Current liabilities
Notes and accounts payable-trade
Short-term loans payable
Current portion of long-term loans payable
Current portion of bonds
Income taxes payable
Provision for business structure improvement
Accrued expenses
Other
Total
Noncurrent liabilities
Bonds payable
Long-term loans payable
Provision for business structure improvement
Net defined benefit liability
Asset retirement obligations
Lease obligations
Deferred tax liabilities
Other
Total
Total liabilities<Net assets>
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total
Subscription rights to shares
Non-controlling interests
Total net assets
Total liabilities and net assets

75

FY2019(As of Mar. 31, 2020)(Millions of yen)
FY2020(As of Mar. 31, 2021)

80,06898,372
34,268
－
5,464
1,089
21,912
46,467
287,640

92,544
95,38718,06520,0105,577
2,330
23,64552,496
310,054

35,024
202,0132,325
39,4642,228
10,764
2,929
10,426305,174
592,814

15,000218,857－
37,5001,077
11,275
4,346
10,061
298,116
608,169

71,833
103,692
247,055(13,131)409,449

71,833
103,756
229,805(13,047)
392,346

12,403(1,020)(23,217)(3,452)(15,286)

21,840607(7,087)(1,557)
13,804772
16,475
411,409
1,004,223

899
21,209428,257
1,036,427

(2) Consolidated Statements of Income(Millions of yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Equity in earnings of affiliates
Foreign exchange gaines
Gain on valuation of derivatives
Miscellaneous income
Total
Non-operating expenses
Interest expenses
Foreign exchange losses
Loss on valuation of derivatives
Loss on investments in partnerships
Contribution
Miscellaneous loss
Total
Ordinary income
Extraordinary income
Gain on sales of noncurrent assets
Gain on sales of investment securities
Gain on step acquisitions
Other
Total
Extraordinary loss
Loss on sales and retirement of noncurrent assets
Loss on valuation of investment securities
Impairment loss
Business structure improvement expenses
Loss related to COVID-19
Other
Total
Income before income taxes
Income taxes - current
Income taxes - deferred
Total
Profit (loss)
Profit attributable to non-controlling interests
Profit (loss) attributable to owners of parent

76

FY2019FY2020(Apr. 2019-Mar. 2020)(Apr. 2020-Mar. 2021)

853,746
590,321
263,424
207,219
56,205

836,512581,515254,997
200,066
54,931

928
1,444
1,997
1,145
7
1,283
6,804

680
1,322
2,548
－
2,276
1,490
8,317

3,717
－
2,168
324

2,831
3,615
－
998

408
2,056
8,673
54,337

373
1,773
9,589
53,658

160
5,998
－
548
6,706

1,821
2,626
2,009
7
6,463

2,677
114
11,030
4,232
－
1,432
19,48541,557
12,306
2,272
14,57826,9801,727
25,252

2,192
1,001
44,101
125
267
3,085
50,7709,351
12,467
1,098
13,565(4,213)
2,448(6,662)

(3) Consolidated Statement of Changes in Net Assets
FY2020 (Apr. 2020 - Mar. 2021)(Millions of yen)
Shareholders' equity
Capital stock Capital surplus

Balance as of March 31, 2020
Changes of items during the period
Dividends from surplus
Profit (loss) attributable to owners of parent

71,833(10,557)(6,662)

Purchase of treasury stock
Disposal of treasury stock
Transfer of loss on disposal of treasury shares

(31)
31

Change in treasury shares of parent arising from transactions
with non-controlling shareholders
Net changes of items other than shareholders' equity
Total
Balance at March 31, 2021

103,692

Total
Treasury stock shareholders'equity247,055(13,131)409,449

Retainedearnings(10,557)(6,662)
(8)
91

(8)
60

(31)

－

64

－
71,833

64
103,75664(17,250)
229,805

84(13,047)(17,102)392,346

Accumulated other comprehensive income
Valuation
Deferred gains
difference onor losses onavailable-forhedges
sale securities
Balance as of March 31, 2020
Changes of items during the period
Dividends from surplus

12,403(1,020)Foreigncurrencytranslation
adjustment(23,217)

Remeasurements ofdefined benefit
plans(3,452)

Total(15,286)

Subscription
Non-controllingrights tointerests
shares772

16,475

Total net
assets411,409(10,557)

Profit (loss) attributable to owners of parent
Purchase of treasury stock
Disposal of treasury stock(6,662)(8)
60

Transfer of loss on disposal of treasury shares－

Change in treasury shares of parent arising from transactions
with non-controlling shareholders

64

Net changes of items other than shareholders' equity
Total

9,438
9,438

1,627
1,627

16,13016,130

1,895
1,895

29,09029,090

127
127

4,734
4,734

33,951
16,848

Balance at March 31, 2021

21,840607(7,087)(1,557)

13,804899

21,209428,25777

Consolidated Statements of Comprehensive Income (Reference)(Millions of yen)

Profit (loss)
Other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of associates accounted for using equity
methodTotal
Comprehensive income
Comprehensive income attributable to :Owners of parent
Non-controlling interests

78

FY2019FY2020(Apr. 2019-Mar. 2020)(Apr. 2020-Mar. 2021)

26,980(4,213)(14,656)(967)(11,764)(1,019)

9,894
1,627
15,195
1,912

(11)

949

(28,416)(1,436)

29,57725,363(2,762)
1,325

22,4292,935

Consolidated Statements of Cash Flows (Reference)(Million yen)

Cash flows from operating activities
Income before income taxes
Depreciation and amortization
Impairment loss
Increase (decrease) in net defined benefit liability
Decrease (increase) in net defined benefit asset
Increase (decrease) in allowance for doubtful receivables
Increase (decrease) in provision for business structure improvement
Interest and dividends income
Interest expenses
Equity in (earnings) losses of affiliates
Loss (gain) on valuation of derivatives
Loss (gain) on sales and retirement of noncurrent assets
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Loss (gain) on step acquisitions
Decrease (increase) in notes and accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Other, net
Subtotal

FY2019FY2020(Apr. 2019-Mar. 2020)(Apr. 2020-Mar. 2021)

41,55750,95011,030
1,617
(665)
(95)
3,332
(2,372)
3,717(1,997)2,161
2,517(5,986)114

9,351
51,84044,101
822
(307)
(630)
(5)
(2,002)2,831(2,548)(2,276)370(2,626)1,001(2,009)(6,765)
7,558
7,455
10,957
117,119－
19,875(4,460)(9,465)(5,488)106,342Interest and dividends income received

6,575

6,245

Interest expenses paid
Extra retirement payments
Income taxes paid
Net cash and cash equivalents provided by operating activities(3,745)－(14,958)
94,214(2,883)(1,058)(11,694)
107,729(66,301)
261(4,020)(5,700)9,250(12,681)(56,817)
2,221(4,109)(2,194)
6,991(22,226)

13,158

－

(906)
1,147
(1,277)
1,273(2,127)(67,922)

－
(713)
(131)
42
(2,650)(79,587)(2,769)15,000(15,000)
16,675(6,735)(12)(13,427)(652)
297(1,437)(8,059)(6,046)

Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of shares of subsidiaries resulting in change in scope of consolidation
Proceeds from sales of shares of subsidiaries resulting in change in scope of
consolidation
Payments for acquisition of businesses
Decrease (increase) in short-term loans receivable
Payments of long-term loans receivableCollections of long-term loans receivable
Other, net
Net cash and cash equivalents used in investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Proceeds from issuance of bonds
Redemption of bonds
Proceeds from long-term loans payable
Repayment of long-term loans payable
Purchase of treasury shares
Cash dividends paid
Cash dividends paid to non-controlling interests
Proceeds from share issuance to non-controlling shareholders
Other, net
Net cash and cash equivalents provided by financing activities－－
35,692(37,835)(8)(10,557)(753)－(1,371)(20,878)

Effect of exchange rate changes on cash and cash equivalents(2,438)2,901

Net increase (decrease) in cash and cash equivalents

15,794

10,165

Cash and cash equivalents at beginning of period

140,434

156,290

Increase in cash and cash equivalents resulting from merger with unconsolidated
Cash and cash equivalents at end of period

62
156,290－
166,45579